"If we are speaking about the price of electricity in Europe, we must understand that not having enough production capacity in Europe is not behind the price increase, but the price increase stems from the prices of natural gas and coal having doubled or tripled since the start of the year and that the price of CO2 has doubled," Veskimägi told ERR. "If the input gets more expensive for a product, the product will obviously be more expensive."

"So I would like to clear up a statement that has popped up over recent days that renewable energy has brought forth expensive electricity prices - certainly not. That it is still conventional thermal power plants, which produce electricity at higher prices today than before. It is the opposite, if there were more wind, the price of electricity in some hours would be significantly cheaper," Veskimägi emphasized.

He said there are no issues in Europe when it comes to the security of electricity supply. "Everything is fine with the supply and the electricity market, there are more than enough power plants. So there is no danger to the electricity supply for Estonian consumers in light of these higher prices," the Elering chief added.

Plants suspended due to low prices

Veskimägi explained that operation in some power plants has been suspended, since producing electricity would be more expensive than what is available on the market.

"So if power plants make daily offers on a variable cost basis and the price of CO2 is €62 per ton and for example, there is a principle in Narva power plants that a ton of CO2 is emitted to produce a megawatt-hour, the price will basically be added to that of electricity. Meaning, there are power plants that do not fit into the market at these prices," he explained.

"That is why I always say that if the investments for wind farms, the variable costs of which are essentially non-existent, were made and there would be more wind, more wind farms, those farms would be operational and would bring down the prices, meaning there would be less room for classic thermal power stations," Veskimägi added.

The price of electricity for the average person is very small

He recommended people look at what the effect of changed electricity prices have on a regular household. "Here in Elering, I just asked a colleague sitting next to me what their yearly electricity consumption was. They have a two-room apartment and consume some 1.2 megawatt-hours per year and pay some five euros per month for electricity. Even if prices double, it will cost 10, if they triple, it will cost 15," Veskimägi said.

"We can certainly discuss whether five euros is a lot of money for a household or not. However, we must understand that higher electricity prices definitely sound significant as a headline, but its impact on most households, also in Estonia and also at today's level of welfare in Estonia, is already such that it is certainly not deadly," he said.

The Elering board chair noted that the potential effects of continuing to use fossil fuels and emitting endless amounts of CO2 would affect everyone much more. "That bill would be considerably more expensive than the electricity bill you get at home through electricity that is just a bit more expensive," Veskimägi said.

Responding to a question about energy carrier excise duty, Veskimägi noted that there are social protection measures for families, for whom this ends up being a problem.

Speaking about the excise duty on energy carriers, Veskimagi said that there are social protection measures for the families for whom it becomes a problem.

"I would not rush to reconsider these strategic positions on the basis off a change in electricity price over a few months. And since the growth of general wellbeing has also been fast, the economy is growing and its effects on households are not as big. If it is too great for someone, there are certain social welfare measures in place so that everyone can still manage," Veskimägi said.

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