Support for CHP plants is not based on their efficiency

In many countries cogeneration - a combined production of electricity and heat is developed and supported. It allows to more efficiently use the fossil fuel and reduce the air pollution. In Lithuania 12 CHP plants and the power plant Lietuvos elektrinė are supported by setting electricity procurement quotas for them.

“In Lithuania CHP plants are supported without consideration of efficiency of energy production, and the existing support system for CHP plants distorts the market. Meanwhile, the European Union legislation highlights the promotion of high-efficiency CHP plants,“ says the Deputy Auditor General Viktoras Švedas.

Having analysed the procurement quotas for the supported electricity set for the CHP plants, the NAOL stated that the quotas were set without any clear criteria, accordingly such a procedure is not transparent.

Establishing the scope of procurement from CHP plants in 2010, the scope of the procured supported electricity production in the upcoming year was not forecasted, therefore CHP plants may not plan the future perspectives, the need for investments, as well as to forecast the money flows. In the opinion of the NAOL, reasonable doubts are raised by the supported electricity production quota allocated to the plant Lietuvos elektrinė, since there are no criteria following which it is set, as well as the need for quota to ensure energy safety is evaluated.

The NAOL recommended the Ministry of Energy to evaluate perspectives of cogeneration in the national energy system, as well as the scope of energy production and consumption produced in CHP plants. Furthermore, there is a need to establish methods and objective criteria following which the scope of production of the supported electricity would be allocated to CHP plants. It was also recommended to hereafter approve the supported electricity quotas only having received the opinion of the National Control Commission for Prices and Energy on their impact on the price of electricity.



Public audit report is available in Lithuanian:
Setting the Scope of Procurement (Quotas) for the Supported Electricity Produced in CHP Plants