Investors are in no hurry to buy power plants in Estonia: Without Russia, 1000 MW are needed

Within 10 years, Estonia needs to build new power plants with a total capacity of 1 GW, which will cost 1 billion euros. Thus, outside the energy ring with Russia, the country will be able to guarantee reserve capacities. However, so far investors are in no hurry to invest with the local generation, as they fear for their income.

"Today there are technologies, projects and developments that can be implemented. The main problem now is the lack of confidence in income: if it appears, then, of course, there will be performers who are ready to engage in these projects. I do not believe that new capacities will appear in Estonia without support mechanisms," Johan Agurajuja, Chairman of the Management Board of Enefit Green, told the Actual Camera.

It is not yet clear what the support from the state will look like.

"We have signed an agreement with a consulting company that is well versed in all such schemes, which helps to prepare possible solutions. We ourselves call it a kind of "menu", which lists the options between which we have to start choosing at all. If today we answer the question between what exactly we choose, then in fact we do not yet know all the possible options. We understand that various support schemes are used in many European countries, but which of them can be adapted to the conditions of Estonia is still difficult to say," said Kalle Kilk, head of Elering.

According to him, in any case, consumers will have to pay for everything.

"Initially, they tried to build the market mechanism in such a way that the market itself stimulates the emergence of new power plants; if this does not happen, it becomes necessary to solve the problem through a separate line of payments. I don't think the system will change in the near future, so the issue will have to be resolved through a separate payment mechanism. Ultimately, we, as consumers, still pay all reasonable costs if we want the lights to be on in the house," Kalle Kilk said, adding that they are primarily considering the construction of gas—fired power plants: "The question is how many to build by 2035."

As EADaily reported, after leaving the BRELL energy ring, the Baltic countries are forced to have expensive reserve capacities that Russia previously provided. In Estonia, this role is now performed by shale oil power plants, but they will have to be replaced within 10 years.