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Published: 11/12/2015. Updated: 2/5/2016

Regarding price of the service of access to interconnection lines

Common regional methodology on import-export tariff from/to the third countries

​By NCCs protocol decision of December 31, 2015, NCC recommended to Lithuanian TSO Litgrid AB to initiate discussion with TSOs and regulatory authorities of the Baltic region on preparation of common regional methodology on import-export tariff from/to the third countries.
Discussion about possibilities to have a regional import-export tariff from/to the third countries with all interested parties is expected during the 21st Baltic Electricity Forum, which will be held in the beginning of May, 2016.

Price of the service of access to interconnection lines (NJL tariff)

​5,27 EUR/MWh NCC decision of December 30th, 2015.
NJL tariff will come in force from March 1st, 2016.

Results of public consultation on NJL tariff

Summary of the assessment of the comments from the public consultation,
December 22, 2015.

Comments received during the public consultation on NJL tariff

Estonian Competition Authority, November 16, 2015
Swedish Energy Markets Inspectorate, November 16, 2015
Danish Energy Regulatory Authority, November 19, 2015, November 19, 2015
Public Utilities Commission of Latvia, November 20, 2015
AS Augstsprieguma tikls, November 20, 2015
Energy Authority of Finland, November 23, 2015
Energy Regulatory Office of Poland, November 23, 2015

Fingrid Oyj, November 27, 2015

Public consultation on NJL tariff (from November 6th  till November 20th)

National Commission for Energy Control and Prices of the Republic of Lithuania (hereinafter – the NCC) launches public consultation on the setting of price of the service of access to interconnection lines (for electricity export to the third countries (i.e. non–EU and non–EEA countries)).
The main purpose of this price of the service of access to interconnection lines (hereinafter - NJL tariff) is to cover cross-border transmission costs, which are not covered through the Inter-Transmission System Operator Compensation Mechanism (hereinafter – ITC mechanism). According to the methodology (attached in Appendix 1), NJL tariff for years 2016 and 2017 will be calculated according to the formula provided below:

Later NJL tariff in t year will be calculated taking into account historical t-2 year data of cross-border transmission costs, attributable to NJL and amount of electricity exported to the third countries.
The legal background of the NJL tariff is set in accordance with Law on Electricity of Republic of Lithuania Article 67 paragraph 10 and thereof taking into account the letter of Ministry of Energy of the Republic of Lithuania submitted in 18th of May, 2015, which sets out the practical reasons for the necessity of NJL tariff. The reasons are the following: (i) incurred costs of usage of interconnection services are not covered by the ITC mechanism, (ii) therefore such costs are assessed in transmission tariff, i.e. covered by electricity consumers of Lithuania, (iii) new interconnections NordBalt and LitPol Link since year 2016 will lead to more costs not covered by ITC mechanism and, therefore, (iv) to new export opportunities to the third countries.
During the meetings of Committees of Senior Officials of Baltic Council of Ministers held on 27th of February and 27th of March, 2015 Lithuania presented its willingness to introduce NJL tariff from 1st of January, 2016 using entry/exit fee model.
NCC held public consultation with Lithuanian market participants on the draft of methodology of NJL tariff from September 8, 2015 to September 17, 2015 and afterwards on October 8, 2015 asked for opinion of Latvian and Estonian market participants as well as regulators.
The final version of the methodology of NJL tariff was adopted on October 29, 2015 (Methodology in Lithuanian is publicly available here; English translation you might find here.
During the discussions on NJL tariff in the 20th Baltic Electricity Market Forum working group meeting on November 2, 2015 a proposal to ask for opinion of not only Baltic countries energy regulators and market participants, but also Finland, Sweden, Denmark and Norway energy regulators and market participants was expressed due to common participation in Nord Pool Spot AS power exchange.
Preliminary calculation of 2016 NJL tariff has been performed by NCC and the preliminary results showed that the NJL tariff would be equal to 5,45 EUR/MWh. Initial calculation data is presented here. In order to make final calculations of the NJL tariff, NCC asked additional information from Lithuanian transmission system operator (hereinafter – TSO) LITGRID AB.
Also Lithuanian TSO LITGRID AB on October 29, 2015 informed NCC about performed simulation of influence of NJL tariff for Baltic states in 2016 with Balmorel market modeling tool, commonly used by Baltic TSOs, according to these assumptions:
• new interconnections NordBalt and LitPol Link are functioning;
• conservative growth scenario was used (generation and consumption are without major changes);
• assessment of electricity market development included not only Baltic states, but also Scandinavian countries and Poland;
• electricity trade with Russia and Belorussia was evaluated using statistical 2014 data of Russian electricity market prices;
• indicative price of NJL tariff equal to 6 EUR/MWh was used;
• two scenarios of social-economical welfare analysis was used: when NJL tariff is not set and when NJL volume is zero.

According to the results of this simulation:
• electricity market price because of NJL tariff decreases by 0,4 EUR/MWh in Lithuania and Latvia, and by 0,1 EUR/MWh in Estonia;
• setting of NJL tariff could reduce export to the third countries from 235 GWh to 0 GWh;
• benefit of NJL tariff for the Baltic states could be 8.6 million EUR.

Considering the importance of NJL tariff and taking into account that Latvian and Estonian market participants as well as regulators were asked to express their opinion on NJL tariff already on 8th of October, 2015, also the topic on NJL tariff was presented in 20th Baltic Electricity Market Forum, in accordance with Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC Article 38, the NCC kindly asks to provide an opinion about the NJL tariff by

November 20, 2015, to the email address

The NJL tariff for year 2016 will be calculated by NCC after receiving and considering the opinions of market participants in the end of November, 2015 – beginning of December, 2015.

If You need any additional information regarding NJL tariff please contact Advisor of Electricity Division of Gas and Electricity Department of the NCC Ramutė Cirulytė, phone No. (+370 5) 213 5241, e-mail: