Gas decarbonization pathways for the Baltic states and Finland

A research paper evaluating four decarbonization scenarios for the gas sectors of Estonia, Latvia, Lithuania, and Finland. It finds that full decarbonization by 2050 is feasible, with a 'Cost minimal' scenario offering the best economic outcome through a mix of biomethane and renewable hydrogen, reducing total system costs by 44% compared to business-as-usual.

• Full decarbonization of the gas sectors in Finland, Estonia, Latvia, and Lithuania is feasible by 2050. The study identifies that the region can maintain security of supply while decarbonizing, potentially achieving this goal even before 2050.
• The Cost minimal (CM) scenario is the most economically advantageous pathway, predicting a 100% decarbonized gas supply by 2040. It relies on biomethane for 64% (23 TWh) and renewable hydrogen for 36% (14 TWh) of the supply. This scenario results in a 44% reduction in total gas system costs compared to the Business-as-usual (BAU) scenario and generates between 20,189 and 21,268 additional jobs.
• The region's gas demand is projected to decrease from 63 terawatt hours (TWh) in 2021 to 38 TWh in 2050, representing a 40% reduction due to energy efficiency and direct electrification measures.
• Renewable hydrogen production costs are expected to decrease by approximately 64% between 2030 and 2050. Despite this, the average regional cost of renewable hydrogen (around 154 EUR/MWh) remains significantly higher than biomethane, which has an average regional cost of 55 EUR/MWh, with Latvia having the lowest costs at around 44 EUR/MWh.
• To achieve the Cost minimal (CM) scenario, the region requires a total investment of EUR 11.3 billion by 2050 for renewable gas production and storage. Lithuania and Finland account for 88% of these costs due to their larger gas markets. Specific capacity targets for the CM scenario include: - Estonia: 357 MW biomethane, 200 MW hydrogen - Latvia: 363 MW biomethane, 242 MW hydrogen - Lithuania: 1074 MW biomethane, 3783 MW hydrogen, 1031 MW SNG - Finland: 1497 MW biomethane, 2689 MW hydrogen
• Existing LNG terminals, specifically Klaipeda, are expected to be sufficient for regional needs until 2044. While these terminals can import synthetic methane and bio-LNG without conversion, repurposing for hydrogen derivatives like green ammonia would require technical changes, new environmental permits, and reassessed safety zones due to toxicity.
• The study identifies several critical risks to decarbonization, including economic downturns, infrastructure delays, reliance on external supplies, and the availability of biomass and renewable electricity. Proposed mitigations include implementing supportive price signals, proactive regional planning, strengthening solidarity arrangements, and funding R&D for gas decarbonization technologies.

APA

Muthukumaran, G., & Keypour, J. (2024). Gas decarbonization pathways for the Baltic states and Finland. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2024/04/sei2024.020-gas-decarbonization-baltics-finland.pdf

Chicago

Muthukumaran, Gowtham, and Javad Keypour. Gas decarbonization pathways for the Baltic states and Finland. Stockholm Environment Institute, 2024. https://www.sei.org/wp-content/uploads/2024/04/sei2024.020-gas-decarbonization-baltics-finland.pdf.

Wikipedia

{{cite report |last1=Muthukumaran |first1=Gowtham |last2=Keypour |first2=Javad |title=Gas decarbonization pathways for the Baltic states and Finland |publisher=Stockholm Environment Institute |date=June 2024 |url=https://www.sei.org/wp-content/uploads/2024/04/sei2024.020-gas-decarbonization-baltics-finland.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{muthukumaran2024gas, author = {Muthukumaran, Gowtham and Keypour, Javad}, title = {{Gas decarbonization pathways for the Baltic states and Finland}}, institution = {Stockholm Environment Institute}, year = {2024}, month = jun, url = {https://www.sei.org/wp-content/uploads/2024/04/sei2024.020-gas-decarbonization-baltics-finland.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }