Renewable Energy Lobby Moves to Prevent Subsidies Cut
Estonia is breaking its obligations to a European Union directive in an effort to cut renewable energy subsidies, according to the European Renewable Energies Federation (EREF), a powerful lobby that protects the interests of fuel and electricity producers.
Last week, the Ministry of Economic Affairs tabled a bill that would decrease subsidies, the so-called “feed-in tariffs,” to renewable energy producers by 16 to 26 euros per megawatt hour as of 2013. The draft's consultation period ends on February 14, after which it would need to get confirmation from the Cabinet and then Parliament.
EREF claimed the reform could mean bankruptcy for existing producers who are counting on the promised subsidies.
“The planned retroactive changes will not only have devastating impact on renewable energy power producers, but it certainly would be a flagrant violation of Estonia’s obligations according the Renewables Directive,” the lobby's president, Rainer Hinrichs-Rahlwes, said in a press release. “The Directive certainly does not allow for retroactive deterioration of support schemes, even less so, if the national action plan of a member state was building on them to achieve the binding national target.”
But a 2010 analysis by the Competition Authority concluded that government support for renewable energy producers was too extensive, harming competition and burdening taxpayers.
From 2007 to 2010, subsidies for renewable energy producers have grown from 5.6 to 61.5 million euros. The agency’s study examined subsidies for wind, biomass, gas and hydroelectric power.
Ott Tammik