The company earned €19.3 million in net profit, a fall of 45 percent on the previous year as noted, while Earnings before interest, taxes, depreciation and amortization (EBITDA) fell by 18 percent to €213.6 million. Sales revenue fell 10 percent to €883.7 million, the company says, via a press release.

Restrictions arising from the pandemic were twinned with exceptionally mild winter months at the beginning and end of the year to lead to a reduced consumption on the previous year, while an abundance of Nordic hydropower kept supply levels high and led pushed prices down on the Nord Pool market, the company says.

Another challenge the company is facing is the decline of the oil shale sector, which once provided the bulk of Estonia's electricity needs at relatively low prices but now will have to be wound down in order to meet EU climate change goals over the coming decades.

Aging oil shale plants being wound down, newer Auvere plant being modernized

Three of Eesti Energia's oil shale power plants (the shale is mined nearby in Ida-Virumaa and refined into the oil used in fueling power stations, and also has several by-products used in other applications – ed.) were written down to a total of €36 million last year, the company says, though its newer plant at Auvere was written up to €36 million.

Eesti Energia CFO Andri Avila said: "Our older oil shale power plants are at the end of their technical life and rarely access the market due to the high CO2 price resulting from the [EU's] climate policy, but they continue to be important in ensuring a reserve for steerable electricity generation.

Plans are in place to modify Auvere to diversify the types of fuel it can use, reducing the oil shale component to 20 percent some time in the future, Avila added. This will also make it more competitive, he said, as will restructuring of Eesti Energia which has already taken place.

Renewables grew by 20 percent on year

The company says it has also seen strong growth in renewables – an area heavily focused on in the fight to transition away from oil shale – and its electricity and heat output (another by-product utilized by Eesti Energia is the heat from its power stations, which is piped particularly to nearby towns like Narva, to provide warmth at a relatively low rate – ed.) comprised 38 percent of the total, at 1.9 Twh of energy, representing a 20 percent rise on year.

Eesti Energia's renewables subsidiary is Enefit Green.

Renewable electricity output alone accounted for 40 percent of the 3.8 TWh electricity Eesti Energia produced in 2020 at 1.5 TWh.

Wind power production increased by 11 percent to 1.14 TWh, 2019-2020, and renewable energy produced at thermal power plants increased by 33 percent, to 243 GWh.

The company says the reduction of the carbon intensity of energy production in 2020 led to a 35 percent fall in its CO2 emissions compared with 2019, falling from 5.9 million tonnes to 3.8 million tonnes.

Compared with 2018, its carbon footprint has decreased threefold, the company says.

Estonian, European and world economic and political developments had their effect too

Though the company did not state this in its press release, low oil prices in early 2020 and also the continuing, and changing, EU climate regulations regarding CO2 emissions credit sales and related areas, as well as political issues regarding the expected decline of the oil shale sector in Ida-Viru County, a traditional stronghold of the Center Party, are also likely to have had an impact on Eesti Energia's performance.

The coronavirus also hit the company, as a workplace, in concrete terms, with around 10 percent of its workforce contracting the virus at one point or another. Several outbreaks were identified in the autumn among miners in eastern Estonia and also spread to and via family circles and entertainment outlets.

Other quick statistics

• 3.8 TWh of electricity, 1.1 TWh of heat, 5.1 TWh (452,000 t) of liquid fuels produced.
• Total volume of energy production decreased by 15 percent year-on-year due to reduced oil shale electricity production.
• Stock exchange price of electricity fell year-on-year in all of Eesti Energia's home markets.
• Average annual price in the Estonian price area was 33.7 €/MWh (down 27 percent), in Latvia and Lithuania 34 €/MWh (26 percent fall), in Finland 28 €/MWh (36.4 percent fall) and in Poland 46.8 €/MWh (down 12 percent) – all figures on year to 2020.
• Eesti Energia sold 7.8 TWh of electricity, 2 TWh of gas, 0.9 TWh of heat and 5.1 TWh (461,000 t) of liquid fuels in 2020.
• Total volume of energy sales rose by 0.7 TWh, or 4 percent over the year.
• Group's investments increased by 35 percent over the year to €183.8 million. Bulk of this (€95 million) was investments in improving grid distribution including against weather (autumn and winter storms regularly cause issues with electricity supply in Estonia, though this is more an issue for the grid distribution firm, Elering – ed.); the share of weatherproof grid has now grown to 70 percent.

Overall, Avila said the year had been: "A serious challenge, since a tenth of Eesti Energia's employees tested positive for the coronavirus over the year. Nevertheless, we were able to ensure a smooth operation of vital services and be a reliable partner for our customers even in the most difficult times."

-- 

Follow ERR News on Facebook and Twitter and never miss an update!