Abstract
The paper provides a comparative analysis of economic growth in Estonia, Latvia and Lithuania and discusses differences in development of the main sectors during the period 2000–2016. Based on detailed analysis of energy sector development, the driving factors influencing changes in primary energy consumption in each country and in the Baltic region are discovered. Increase of renewable energy sources (RES) consumption in the Baltic region over this period by 73.6% is emphasized. The paper presents valuable insights from analysis of trends in final energy consumption by sectors of the national economies, branches of the manufacturing sector, and by energy carriers. Long-term relationships between economic growth and final energy consumption are established. An econometric model was applied to predict final energy demand in the Baltic States for the 2020 horizon. It is emphasized that growing activities in the manufacturing and transport sectors will cause increase of final energy demand in all three countries. Based on detailed analysis of greenhouse gas (GHG) emissions trends some positive shifts are shown and the necessity of new policies in the transport sector and agriculture is identified. Changes of emission intensity indicators are examined and a potential for decoupling of carbon dioxide (CO2) emissions from economic growth in Estonia is indicated.
Highlights
For half a century Estonia, Latvia and Lithuania were known as small republics on the eastern coast of the Baltic Sea fully integrated into the economy of the Former Soviet Union (FSU), a huge country with a centrally planned economy
( Pt Po β where E is the final energy consumption in the sector in PJ or ktoe, A the value added created in the sector in million EUR, P the price of energy resources in EUR/toe, C factor of expected energy saving, t the time, 0 the initial values corresponding to a base year, α the income elasticity, and ß the price elasticity
The very fast growth of final energy consumption in the transport sector should be stressed—in Latvia it was increasing over this period on average by 8.6%, in Lithuania by 8.3%, in Estonia by 5.9%, and in the Baltic region by 7.8% per year
Summary
For half a century Estonia, Latvia and Lithuania were known as small republics on the eastern coast of the Baltic Sea fully integrated into the economy of the Former Soviet Union (FSU), a huge country with a centrally planned economy. Analysis of sustainable development in compliance with EU policy, including trends in the economic growth, energy consumption and reduction of greenhouse gas (GHG) emissions in Lithuania was discussed in [19,20]. The paper provides an integrated analysis of the energy sector development during the period 2000–2016, trends in the economic growth and energy consumption in each country and for the first time in the Baltic region. Both methodological and applied results describe the scientific novelty of the present research.
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