Lithuania is considering closing 900MW of its gas-fired generation capacity by 2016 due to reduced margins.
Producer and wholesaler of electricity Lietuvos Energijos Gamyba (LEG), which is part of the state-controlled energy group Lietuvos Energija, will close two 150MW units at Lithuania's biggest power plant, Lietuvos Elektrine, by the end of 2014 and two additional units, each producing 300MW, in 2015.
Around 60% of electricity demand for the country is being met through imports as domestic generation of electricity from imported gas is turning out to be expensive, reports Reuters.
High gas prices and low wholesale prices for power have been the primary reasons for problems faced by gas-fired power plants in Europe.
Following the closures, the company will operate one 455MW combined cycle gas turbine (CCGT) and two reserve power units, each carrying a capacity of 300MW.
Lietuvos Energijos is also seeking to invest between $148m to $212m for 225MW unit development at its Kruonis pumped storage hydropower plant and a wind power park with an approximately 40MW to 45MW capacity.
Lithuania, by the end of 2015, plans to construct new power links to Sweden and Poland, which is expected to further push the prices down in the country.
In addition to importing gas from Russia, the country intends to import liquefied natural gas (LNG) from 2015.
Meanwhile, Lietuvos Energijos has announced its 2014-2020 business strategy.
Lietuvos Energijos Gamyba CEO Juozas Bartlingas said: "The seven-year strategy was drafted by taking into consideration a number of various aspects that affect the activity of Lietuvos Energijos Gamyba."
The company expects its total revenue to drop for the next year due to reduced production volumes at Elektrenai Complex, and intense competition.
Image: Lietuvos Energijos's Lietuvos elektrine power plant in Lithuania. Photo: courtesy of Bearas.