Chinese state-owned company successfully joins the competitions of Lithuanian energy giants Business

The Energy Networks Institute, managed by the Chinese state-owned company North China Power Engineering, wins tenders for strategic energy companies in Lithuania. Experts believe this is related to the geopolitics of Chinese investment in the region, and any such transaction must be weighed at the level of national security.

The owner of the company ensures that the shareholders do not interfere in the activities, and their interest is only profit.

Win competitions one after another

In Kaunas, on Kampo street in the Kalniečių district, it is impossible to notice the red-black building. However, not everyone would notice the notes outside the window: Energy China. This is a kind of citadel of the Chinese state energy holding company in Lithuania, because the Chinese in Kaunas run the whole company under a famous name: “Energy Networks Institute”.

The latter is doing well to win tenders for energy services in strategic state companies such as Litgrid and Ignitis.

For example, on June 29, the network operator Litgrid entered into an agreement with AB Energetikos tinklų institas on the reconstruction of the Priekulė electricity distribution yard.

The value of the works is 1.4 million. euros. The work will take more than two years. Last year, the Chinese-owned company won even more tenders: 1.6 million power line decommissioning. installed battery energy storage systems and replaced transformers.

Litgrid is going nowhere for the winner

Litgrid Jurga Eivait representativeė 15 minutes argued that it was not necessary to ask the Commission for the victory of the Chinese company.

“Neither the object nor the amount of the transaction had a legal basis to inform the Coordination Commission for the Protection of Objects Important for National Security of the planned transaction, since the rights and obligations are clearly regulated,” he explained.

It is true that procurement requires suppliers to be registered in an EU or NATO country. In this case, the winner is the Kaunas company.

“The company’s specialists and experts closely monitor the supplier’s compliance with the contract requirements,” added J. Eivatė.

Ignitis will contact you if it receives a complaint.

Ignitis, the largest state power company, is not far behind Litgrid.

In September of this year, his company Ignitis grupė paslaugų centras entrusted the Institute of Energy Networks with the right to rebuild the Smilgiai substation for 377.5 thousand LTL. EUR excluding VAT. The offer from the Chinese-owned company turned out to be the best among the others in the competition.

How 15 minutes Explained Artūras Ketlerius, Head of Public Relations at Ignitis, in the tender a series of offers has been prepared, the first of which is the Institute of Energy Networks.

“According to the legislation, September 25 is the deadline to postpone the conclusion of the contract. If we do not receive complaints or complaints about the order of the proposal during this period, we will request the Coordinating Commission for the Protection of Important Objects to Guarantee Security National in the verification of the transaction, ”he said.

Previously, the LRT portal also wrote about the Institute’s achievements in competitions.

CEO: shareholders do not interfere in activities

AB Energetikos tinklų institute 91 percent. The shares are owned by North China Power Engineering, a Chinese state-owned construction and energy engineering company. Another 3.8 percent. Giedrius Lynykas owns the shares and 1.1 percent. – Leon Urbon.

North China Power Engineering is owned by China’s state power giant Power China. North China Power Engineering, which acquired the Energy Networks Institute in Kaunas seven years ago, has set foot not only in the Lithuanian state energy economy.

Raimundas Rutkauskas, Head of the Institute of Energy Networks 15 minutes He assured that the shareholders would not interfere in the activities and would only claim profits from the company.

“The institute has been operating for more than 20 years, only Lithuanians work here and no one interferes in our activities. Shareholders only demand good results,” said R. Rutkauskas.

I’m not interested in what shareholders do in Astrave

The Chinese state-owned company is also involved in the Astrava nuclear power plant project. The company that manages the Kaunas company is implementing a project of interconnection of networks and transmission of nuclear energy in Belarus: renewal of networks, construction of substations, modernization. The project received a loan from the State Export-Import Bank of China.

This was previously announced by the Belarusian state media.

“I don’t care where the shareholders work, what they do at Astrave. We focus on work here. The shareholders are a great company, they have many activities, but I do not see any interest in them other than in profits. With us they saw the potential, then they acquired it ”, said the head of the Energy Networks Institute.

North China Power Engineering has run the Kaunas Institute, which employs about 60 people, for seven years. By the way, at that time there were no laws in Lithuania that required obtaining permits from a special government commission.

According to some experts, it would be difficult for a Chinese state company to acquire an energy company in Lithuania now.

He accuses the authorities of not realizing the threat

The head of the Lithuanian Electricity Association, Kęstutis Jauniškis, finds it strange that the Lithuanian government does not perceive threats and does not show any determination to avoid such relationships. “It just came to our knowledge then as usual (ordinary activities)“, He said.

What makes it dangerous? “Electricity supply is a strategic function of the state. In this case, the Chinese gain direct access to the security and technological requirements and secrets of the electricity grid, and the companies that manage the electricity grids are often targeted for cyber attacks ”, Is convinced K. Jauniškis.

One can only speculate, according to him, who will use such information. “It just came to our knowledge then. But generally, a fox in a hen is still not a problem for the current government of the country,” said the director of the Lithuanian Electricity Association.

Poderys: it is important to pass the Commission

However, Virgilijus Poderys, director of the Seimas Energy and Sustainable Development Commission, believes that the companies themselves are responsible, with which they sign contracts. “As far as I know, they have to verify in the Coordination Commission for the Protection of Important Objects to Guarantee National Security. That is if it is gone, it is gone,” he said.

The Commission normally receives findings from the special services, but no objections have been received from the Chinese company.

“Of course, it is surprising that the same company is involved in both the Astrava nuclear power plant and our state projects. However, if the services have no objection, we must rely on those conclusions.” 15 minutes Poderys said.

Regio geopolitical interests

However, former Energy Minister Arvydas Sekmokas is much more categorical. In his view, Chinese investment should be evaluated in terms of national security.

“Chinese investment in the region is in line with their geopolitical interests. They work both in Astrava and in Lithuania, and this is their strategy. The Chinese are interested in having Belarusian electricity enter Lithuania”, A. Sekmokas is convinced .