Prime minister: I instructed state firms to shelve wind-farm disagreements

Kaja Kallas, flanked by Vikerraadio presenters Arp Müller (left) and Mirko Ojakivi.
Kaja Kallas, flanked by Vikerraadio presenters Arp Müller (left) and Mirko Ojakivi. Source: ERR/ Hege-Lee Paiste

Prime Minister Kaja Kallas (Reform) said it was she herself who instructed state electricity generator Eesti Energia and grid distributor Elering to shelve their lawsuit over a southwest Estonian wind-farm, in the interests of boosting the share of renewables in the electricity market. Kallas also said that she believed her government's policy on energy prices and on the pandemic, while unpopular at the moment, would stand the test of time in being seen in future as the right course of action.

"I have given the guidelines that this lawsuit needs to be ended. There is no point in having a lawsuit between the two state-owned companies," Kallas told Vikerraadio show "Stuudios on peaminister" on Monday, adding that there are still obstacles to the development of renewable energy which need removing, including those relating to the construction of a planned offshore wind farm in the Gulf of Riga. 

Substantive analysis of a potential nuclear plant is also needed, the prime minister said. "The nuclear energy working group is due to present its report in September 2022. This is one of the options. Smaller reactors [elsewhere] are now in use in nuclear energy. I have stated that, as Nord Pool participant, we are very interested in bringing it to market."

Kallas also criticized state electricity generator Eesti Energia for not always being able to keep 1,000 MW capacity online, which is the expectation of the state as the owner This has been one of the factors in the recent, soaring electricity prices, she said, referring specifically to the repair work and subsequent down-time at the Auvere power plant in Narva.

Presenters Arp Müller and Mirko Ojakivi noted the importance of which side the decision would come down on – Eesti Energia or Elering.

As reported by ERR News early on this year, Eesti Energia planned to sue Elering over its decision discontinue a support scheme for the planned wind-farm, in Tootsi, Pärnu County.

Elering argued that as of the end of 2016, the wind farm had not yet met the conditions for receiving the support, meaning it was not eligible for support of €53.7 per MWh based on the market price paid for by consumers.

Kallas told Müller and Ojakivi that looking at the €53 per MWh support level would need to be done in the light of the current, record electricity prices.

Prime minister: Money does not come from a hole in the wall

Kallas also called criticism of the government's handling of the recent record energy prices, and support measures initiated, "extremely unfair", adding that €125 million had been earmarked for the purpose and that mirroring a measure imposed in Norway – where the government will reimburse all users to the tune of 50 percent when the electricity price rises above €70 per MWh, between now and March, would not be feasible in Estonia's case.

"There are people who do not need help and do not have to get it," Kallas said, adding that money did not simply issue forth from a whole in the wall, while many other areas – Covid measures and education – also require funds.

"The money that goes to help people comes from the taxpayers' pockets. /.../ If we distribute a little to everyone, we can do less to help those who really need it," she went on, adding that 55 percent of customers are on fixed price contracts, meaning their electricity prices have not risen yet.

The prime minister had at this point, ERR reports, overlooked the fact that many fixed-price contracts have now expired and will be receiving new packages at much higher rates.

AS to those on low incomes but who are at the mercy of landlord-implemented energy contracts which they have no control over, Kallas said that she: "Can't answer with that level of detail. I can state what the political will is. I don't know what those specific agreements are. Maybe that individual has not made their agreement according to the rules. But we have the political will to help people who really need it. If things need specifying, they can wait until later."

 This segued into a comparison – though not prompted by Müller and Ojakivi, rather raised by the prime minister herself – with Margaret Thatcher, whom Kallas said had recently been the subject of a Netflix documentary.

"I watched a Netflix documentary about Thatcher last Sunday. She had to make a lot of difficult decisions at a very difficult time. At the point at which they were taken, those steps were not understood, and that's a natural part of things."

 Reform's support has been falling – from around 30 percent when entering office in January and by most regularly-conducted polls – to around 20 percent now.

Kallas said that it had been a difficult year in general.

"There has been a great deal of frustration in society about the coronavirus. If this is the responsibility of the government, in addition to the energy crisis and security concerns, then ... people want their normal life back," Kallas went on.

"We want to keep society open so that children can go to school and parents to work. So that theaters, cinemas and also cafes and restaurants would stay open. I believe that this effort will ultimately be appreciated."


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Editor: Andrew Whyte

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