From Energy Shock to Social Innovation: Geopolitical Crisis, Regional Divergence and Economic Transformation in the Baltic Region

The recent energy crisis triggered by the Russian invasion of Ukraine has profoundly reshaped regional economies across the Baltic region, transforming energy from a market commodity into a strategic and geopolitical resource. While existing literature emphasises disruption and vulnerability, this paper reframes the crisis as a catalyst for social innovation. Drawing on a comparative analysis of Lithuania, Latvia, Estonia and Poland, the study examines how rising energy prices, supply insecurity and policy responses have stimulated new forms of behavioural adaptation, collective action and institutional change. Particular attention is given to decentralised energy practices, prosumer models and governance innovation. The findings reveal that social innovation emerges unevenly across national contexts, shaped by structural conditions, institutional capacity and geopolitical positioning. The paper argues that energy shocks can function as transformative moments, fostering resilience while also exposing internal divergences within the European Union, and reshaping regional pathways toward sustainability.