Lithuania's grid operator puts Power-to-X in the flexibility toolbox
Litgrid and ESO have assessed Lithuania's flexibility needs rising from 4.36 GW to 7.13 GW by 2035, and Power-to-X is counted among the tools alongside batteries and demand response. We look at what a TSO reaching for electrolysis changes, and why the flexibility market plan due end-2026 is the deadline that decides whether it pays.
EVENTSNEWS
PtXBaltic
8/21/20265 min read
While still challenged by high costs and thin offtake, green hydrogen keeps finding its way into places it wasn't invited a few years ago. The latest one is a transmission system operator's spreadsheet. Litgrid, together with distribution operator ESO, has published Lithuania's first assessment of the flexibility its electricity system will need, and Power-to-X sits in the list of tools being counted — alongside batteries, demand response and flexible generation. That's a quiet sentence in a technical report. It's also the first time in the Baltics that an electrolyser has been treated by a grid operator as system infrastructure rather than as an industrial customer that happens to be large.
A 3 GW gap, and the assessment that put a number on it
The headline figure is straightforward. Lithuania's total flexibility demand is assessed at 4.36 GW today and is projected to reach 7.13 GW by 2035 — roughly 3 GW of new flexible capacity to be built, contracted or otherwise found over the next decade. The assessment covers the 2028–2035 window and is set to be refreshed every two years, which matters more than it sounds: a one-off study is a document, a recurring assessment is a planning instrument that projects can be timed against.
The driver is familiar to anyone tracking the Baltic grid. Solar and wind capacity keeps climbing, consumption is climbing with electrification, and the system has to respond faster to swings on both sides of the meter. Tadas Kivilis, who heads Litgrid's system development management group, framed it without drama: the analysis shows Lithuania's system is flexible and able to integrate further renewables, while demand for flexibility solutions grows. These are the operators' own figures, published in their own report, and not independently audited — we'd treat them as the planning baseline rather than as settled fact.
Power-to-X sits in the toolbox, next to the batteries
The technologies the report examines: energy storage, demand-side response, flexible power plants, cross-border exchange, electrification solutions such as EVs and heat pumps — and Power-to-X. Not as a footnote about long-term decarbonisation, but inside the same assessment as the batteries.
That placement is the story. Electrolysers have spent most of the last five years being modelled as load: something the grid has to accommodate, priced accordingly, connected accordingly. Treating them as a flexibility resource inverts the relationship. A 100 MW electrolyser that can ramp down in seconds when the system is short, and soak up power when prices go negative, is doing the same job as a battery over a different duration — and it ends the day with a molecule to sell instead of an empty state of charge.
A system operator reaching for electrolysis is worth more than another subsidy scheme
Baltic hydrogen ecosystem stakeholders have spent years lobbying energy ministries. The more consequential audience may have been sitting one floor down, in system planning. Ministries set targets; TSOs decide what gets connected, on what terms, and what gets paid for being useful.
When a TSO proactively assesses Power-to-X as a candidate solution to its own operational problem, several things change at once. Grid connection conversations start from a different premise. Network reinforcement studies begin to internalise flexible load rather than sizing for worst-case simultaneous demand. And, eventually, the resource becomes eligible for the mechanisms that pay for flexibility — which is where project economics actually live.
Amber Grid, the Lithuanian gas TSO, published analysis in early 2026 suggesting green hydrogen could supply up to 30% of the country's system flexibility by 2050. We haven't been able to read the full methodology behind that figure, so we'd flag it as directional rather than bankable. But the direction of travel across two Lithuanian network operators is consistent, and consistency between the electricity and gas sides is exactly what a hydrogen system needs.
The end-2026 flexibility market plan is the deadline that matters
Buried in the announcement is the date to put in the calendar. Litgrid intends to present a flexibility market development plan by the end of 2026. That document, not the needs assessment, will determine whether an electrolyser can earn from flexibility or merely provide it for free.
The design questions are unglamorous and decisive. What's the minimum bid size — and can it be aggregated? What's the required response time, and does a proton exchange membrane stack's sub-second ramp get recognised as such? Are products defined by duration in a way that suits four-hour batteries and quietly excludes everything else? Is there any product at all for sustained multi-hour downward flexibility, which is what a large electrolyser is genuinely good at? Get those parameters wrong and Power-to-X stays in the report but never clears a market.
EPSO-G and Litgrid have already released a flexibility services calculator aimed at helping potential providers estimate what participation might look like. We'd encourage developers with Lithuanian sites to run their load profile through it now — not because the numbers will be final, but because the shape of the answer tells you which market design assumptions your business case is silently depending on.
Revenue stacking is where electrolyser economics stop being marginal
Run the arithmetic on a Baltic electrolyser project on hydrogen sales alone and it's tight, usually too tight without a premium offtaker or capital grant. Add a second revenue line for flexibility — balancing capacity, demand response, congestion management — and the picture changes character rather than degree, because that revenue arrives during exactly the hours when you weren't producing anyway.
There's a catch worth being honest about. Flexibility revenue rewards standing idle; hydrogen offtake contracts punish it. A project that promises a steel plant or an e-fuels facility firm monthly volumes can't also promise a TSO unlimited curtailment. Resolving that tension needs storage buffers, tolerant offtake terms, and a realistic view of how many full-load hours you're actually clearing. Nothing here is settled — but the projects that model both revenue lines together, early, will be the ones with credible answers when the market rules land.
Latvia and Estonia are reading the same problem from behind
Post-synchronisation, the three Baltic systems share a physical reality and increasingly a market one. Latvia's AST and Estonia's Elering face the same arithmetic Litgrid has now quantified: more variable generation, more electrified demand, less inherited inertia. Lithuania simply got its assessment out first.
The risk is three national flexibility markets with three sets of product definitions, three qualification processes and three sets of legal costs for anyone building across the region. For a developer sizing a 50–200 MW electrolyser, that fragmentation is a real line item. A harmonised Baltic approach to flexibility products — even just aligned technical qualification criteria — would do more for PtX bankability here than most of the funding instruments currently being discussed. Baltic hydrogen ecosystem stakeholders should be pushing that case now, while Lithuania's rules are still being drafted and the other two have the chance to copy something good rather than invent something different.
What this signals for Baltic Power-to-X
Three things. First, the burden of proof has shifted slightly: a grid operator has put Power-to-X in its own toolbox, so developers no longer have to argue that electrolysers belong in the flexibility conversation — they have to prove their specific asset can deliver on the terms the market will set. Second, the window to influence those terms closes with Litgrid's market plan at the end of 2026, and the technical detail decided there will outlive several political cycles. Third, whatever Lithuania settles on will become the regional default by gravity, so Latvian and Estonian stakeholders have an interest in Lithuanian consultations that isn't obvious from the map.
We'll be following the flexibility market plan closely as it develops. Litgrid and ESO are presenting the report's findings publicly on 27 August — a good place to ask the awkward questions about product design while the answers are still being written.
Source: „Litgrid“: iki 2035 metų Lietuvai reikės 3 GW naujų sistemos lankstumo pajėgumų