This year's electricity price hike is an early sign of just how poorly the current European climate strategy has been planned. Its long-term price is so high and deadlines so unrealistic as to render the green turn virtually unachievable, Helir-Valdor Seeder writes.
It is obvious that climate problems require action. The question is whether the goals are feasible, how to achieve them and what is the price we are willing to pay. The consumer is beginning to feel the price hike today, while it is only the beginning and tip of the iceberg. The European Union's unrealistic climate turn will cost the union its competitive ability and future. The current climate plan leading to such consequences needs to be scrapped and a new more sensible solution found.
This year's electricity price hike is among the first signs of just how poorly the current European climate strategy has been planned. The green turn process is largely declarative, with several European leaders promising to fulfill the five-year plan in three, so to speak, and achieve compliance with green turn goals ahead of schedule.
They include Estonian Prime Minister Kaja Kallas (Reform). She promises that Estonia will make enthusiastic use of all green turn opportunities and urges people to refer to it as the Striped Seal Leap (Viigrihüpe – reference to Estonia's IT and digitization project Tiigrihüpe).
Kaja Kallas seems not to have delved into the consequences of the green turn. The lack of depth in Kallas and other similar premiers' treatment and their inability to see past slogans is what led to the recent electricity price rally. Instead of solving the problem, the government is wringing its hands, saying it has no way to secure cheap power. Paradoxically, in order to bring down the price, it was decided to turn on Estonia's oil shale power plants that by no means contributes to the climate strategy.
Unfortunately, we are only seeing the first signs of price hikes. Head of the Estonian Employers Confederation Arto Aas told ERR that a part of the hike will be transferred to the consumer. This can be described as an optimistic assessment as we all understand the price will be transferred to the consumer in full at the end of the day. In addition to bigger power bills, everyone will soon be paying more for all goods and services.
To alleviate the situation, Isamaa will propose to the government a bill to exempt consumers from the renewable energy fee and cover relevant expenses for producers using CO2 quota proceeds as state budget appropriations. We also propose canceling planned motor fuels and electricity excise duty hikes. Estonia must propose changing the EU C02 quota trading system in a way to rule out sharp price hikes.
These steps would help alleviate the problem in the short term, while we also need to address the problem itself – the unrealistic green turn. As put by Jaak Aaviksoo, "Actual results depend more on careful consideration and responsibility than pace and ambition."
The current enthusiasm and slogans-based European Union climate strategy, the first fruits of which ripened this fall, is only beginning. In the long term, its price is so high and deadlines so unrealistic as to render the green turn virtually unachievable.
Implementation of the plan would sacrifice the EU's global competitiveness, whereas the negative effects of production and organization of life in Europe moving to third countries would be one of the side-effects and consequences of the green turn. This might see predictions that the EU will collapse under the weight of Ursula von der Leyen's green turn come true.
Seeing people's reaction to the first fruits of the green turn in the form of electricity bills, it is difficult for me to believe the Viigrihüpe plan has broad-based public support if taken forward in recent form. Whereas no one has asked society for said support in the first place.
Until the EU remains unable to agree on a strategy its population would find acceptable and where production and sparing the natural environment strike a sensible balance, climate targets should be temporarily dropped.
Estonia needs to see the green turn big picture that goes beyond Europe, while still observing its national interests and energy security that can surely accommodate a sustainable environmental policy.
The Estonian government must actively look for allies among likeminded European countries. We need to work with them to put pressure on the EU for a sensible and workable climate plan our societies can afford.
Editor: Marcus Turovski