EPSO-G’s strategy: key projects, regional development and efficiency

EPSO-G’s strategy: key projects, regional development and efficiency

JSC “EPSO-G”, Lithuanian energy Group Company and CEEP member, recently shared some details about its five-year strategy. It comprises four key directions of the activities of the Group – sustainable growth and the long-term benefit for shareholders; the development of regional activity and the implementation of strategic projects; effective operations; and the formation of a creative and progressive organisation. The strategy also includes the Group’s financial targets and goals.

The Group’s average return on equity in the next coming five years is expected to reach 6.4%, with EBITDA to make up at least EUR 70 million at the end of the period. The strategy identifies EPSO-G group’s strategic projects.

The key objective in the electricity sector is to prepare for synchronisation of the Baltic system with continental Europe network. The preparatory works of this project are outlined in the strategy and the transmission system operator for electricity, LITGRID SC, is responsible of its implementation.

The objectives in gas sector are to efficiently utilize the country’s well-developed gas infrastructure and take advantage of the LNG terminal in cooperation with other Baltic countries. Hence, EPSO-G actively participates in developing the regional gas market and expand the operations of the natural gas exchange operator, GET Baltic, for a more enhanced regional integration as from 2020. Furthermore, the project of the Gas Interconnection Poland–Lithuania (GIPL), done in collaboration with Polish partners, should be completed by the end of 2021. Once the project is completed by the implementing company, Amber Grid SC, the Baltic countries and, likely, Finland will become part of the EU single gas market.

The energy exchange operator, BALTPOOL, is responsible for ensuring a transparent and convenient trade in biofuel, so EPSO-Group will seek that its expertise and developed products to be available for the other countries of the region. The target set for BALTPOOL is to ensure that in three years’ time, its operating income generated outside the Lithuanian market following the expansion reaches at least 10%.

The country’s major energy strategic projects will be implemented not only with a focus on economic cost-benefit analysis and risks factors estimation, but also with a special attention on the projects efficiency, and the soundness and transparency of procurement procedures.

Background: The state-owned EPSO-G group was founded on 4th of July 2012. The sole shareholder of the parent company is the Ministry of Energy of the Republic of Lithuania. EPSO-G group is comprised of seven companies: the parent company, three subsidiaries companies and three lower-tier subsidiaries companies. EPSO-G has a 97.5% shareholding in the electricity transmission system operator LITGRID SC, 96.6% - in the natural gas transmission system operator SC Amber Grid and 67% - in BALTPOOL JSC. EPSO-G also has a non-controlling shareholding interest in another four companies.

Photo: EPSO-G