Baltic States May Suffer for Leaving Soviet Electricity Network
- New Europe Investor
- October 06, 2015
The Baltic States of Lithuania, Latvia and Estonia have the goal of joining the electricity network of Western Europe.
However, in doing so, they would be leaving the network of the former Soviet Union which they were part of for a considerable period of time. This in turn could lead to penalties running into billions of euro based on a BRELL Treaty, signed in 2001 between Russia, Belarus, Estonia, Lithuania and Latvia.
Under the treaty, Russia and Belarus may be entitled to compensation if the Baltic members leave the union.
The Baltic states hope to enter the EU energy union this year, with connections from Poland and Sweden allowing them to import energy from these countries instead of the current arrangement.
It is not unlikely that Russia will look for compensation. Vladimir Putin recently claimed that a Baltic withdrawal from the Russia dominated union could cost Moscow up to €2.5 billion.
However, Gediminas Kirkilas, chairman of the European Affairs Committee at the Lithuanian parliament, recently stated that Brussels would consider reimbursing Russia in the event of compensation being sought.