Estonia has been a member of the World Energy Council since 1937. Estonia was then represented by the National Power Committee, led by Director J. Veerus and Professor P. Kogerman. In 1998, the 17th World Energy Congress in Houston formally reinstated Estonia’s membership of the World Energy Council. The Estonian Member Committee of the World Energy Council was founded on 16 July 2003 by the Ministry of Economic Affairs and Communications, Estonian Academy of Sciences, Estonian Power and Heat Association, Tallinn Technical University, Eesti Energia AS and AS Eesti Gaas.
Hando Sutter has served as the Chairman of the Management Board of Eesti Energia since December 2014. Prior to this he was the regional manager of Nord Pool Spot power exchange in the Baltics and Russia. He has also previously worked in the management teams of regional companies such as ESS Group (renamed to G4S Estonia), Tolaram Investments and Olympic Entertainment Group.
Energy in Estonia
Comparing the results of 2019 and 2020, Estonia’s energy leaders attribute less impact to Critical Uncertainties such as IoT/Blockchain, Data AI and Electricity Prices. The main source of uncertainty continues to be Russia, followed by Climate Framework. Action Priorities continue to be led by EU Cohesion, Digitalisation and Energy Efficiency, while Renewables are seen with slightly higher uncertainty
Russia’s identification as a major Critical Uncertainty reflects its domination as a power producer in the Baltic region. Planned decoupling from Russian power networks in 2025, when synchronisation with the continental European power grid is due to be completed, is an additional element of uncertainty. Priority is being given to discussions on the new EU legal framework to address the carbon leakage from electricity imports from Russia. Uncertainty emerges as trade relations are revised to adjust import dependence against the need to build new capacity.
Climate Framework is seen with greater impact, despite Estonia’s initial hesitation to follow deadlines contained in the EU climate strategy. After additional internal consultations and research, the country has agreed to support the strategy. At the time of this survey, the agreement which aims at making the European Union the first climate-neutral region by 2050 was pending approval at the EU December Summit.
Commodity Prices are seen with greater impact. Production and sales of oil and shale oil face increasing quality requirements, highlighting the need for investments. The profitability of these investments will depend largely on future oil prices. In addition, implications of the increased CO2 price of EU ETS has had a strong impact on the competitiveness of local oil-shale power plants, especially in comparison with Russian producers.
EU Cohesion remains at the forefront of Action Priorities, as Estonia strives to achieve carbon-neutrality within the Energy Union. The EU 2020 budget has allocated considerable support to climate change mitigation, electricity grid synchronisation with Central Europe and gas grid connection with Finland.
Digitalisation is seen with greater impact and lower uncertainty. Estonia is the first EU country to achieve remote-reading capabilities of electricity consumption, storing and making data accessible to every customer through a central data hub. Remote reading capabilities are also gaining momentum in the gas and heating sectors. Several innovative digital and AI solutions have been introduced to track infrastructure deterioration or to optimise grid operations and planning.
Energy Efficiency continues to be perceived as an Action Priority, with a special focus on efficiency in the building sector. The EU-funded Renovation Loan Programme provides guidance and financial assistance to improve the energy efficiency of private homes and buildings. Digitalisation and innovation are also thriving as key assets for enhanced energy efficiency in the country.
Renewable energies are capturing the attention of Estonian energy leaders as the main area of action. Energy efficiency and the EU Clean Energy Package indicate the direction of the country’s energy system for the next few years, with a strong focus on environmental sustainability and energy security.