District heating providers urged to prepare for switching to fuel oil

Boiler plant chimney in Tallinn.
Boiler plant chimney in Tallinn. Source: Siim Lõvi /ERR

Because district heating providers could run into trouble sourcing enough gas for the next heating season, boiler plants should prepare for using fuel oil instead, including by securing the necessary permits, the Ministry of Economic Affairs and Communications recommends.

The Ministry of Economic Affairs and Communications has been contacted by several district heating providers that have failed to source enough gas for the coming winter. Some service providers might fail to secure the necessary gas contracts in time.

Without "preventive steps," there is a real danger that some zones will lose district heating, ministry undersecretary Timo Tatar wrote in a letter sent to municipalities and cities, as well as the Estonian Power Plants and District Heating Association.

In cases where it proves impossible to secure gas supply contracts, entrepreneurs should prepare for switching to alternative fuels, Tatar said. The use of liquid fuels in place of gas requires a permit from the Environmental Board. Newer boiler plants need updates and facilities for storing liquid fuel to be able to use shale oil or light fuel oil.

Tatar admitted that securing permits and carrying out the necessary updates could prove extremely difficult. The former has become a lengthy process due to environmental requirements, while rebuilding boilers and fittings and updating exhaust treatment systems is expensive and also takes time.

Rapid switch from gas to oil could prove impossible

Even though Estonia has relatively few gas boiler plants, many are located in the largest cities – Tallinn, Tartu, Narva and Pärnu – meaning that disruptions could end up affecting a lot of customers, Siim Umbleja, head of the district heating association, told ERR.

"Gas has served as auxiliary fuel for the peak heating season in major cities, and fuel oil infrastructure has been dismantled or fallen into disuse in many places. The question is whether we can switch back to oil quickly, construct tanks and replace burners or not. It could prove to be a major problem," Umbleja admitted.

It would be especially expensive and time-consuming to outfit boiler plans that completely lack infrastructure for the use of heating oil.

Umbleja gave as an example new treatment facilities that switching to oil would require.

"These treatment devices are hugely expensive and could take a very long time to procure. I've heard these treatment facilities cost more than the boiler and generation equipment put together. It is a matter of choice in that we need to ask whether we can afford these investments if the current fuel crisis turns out to be temporary," Umbleja remarked.

Tallinn, home to more than half of Estonia's district heating consumers, has at least some technical capacity for the adoption of shale oil, while the low volume of what is essentially a backup option means it could not be used for the entire heating season, Umbleja said. For anything more, companies would have to invest in new oil tanks.

The Estonian Environmental Board told ERR that it has received a single application to amend an environmental permit to facilitate the use of shale oil as a reserve fuel. No requests have been made for replacing gas with shale oil as the main fuel.

Director General of the Environmental Board Rainer Vakra said entrepreneurs were reminded of the need to secure a permit during a roundtable meeting in May.

According to the law, integrated environmental permit decisions must be made inside 180 days of the request and those for environmental permits inside 90 days.

"Proceedings can be expedited in some cases but always take more than a few days," Vakra said, adding that the higher the quality of the request, the less time it takes to process.

The director added he will do his utmost to speed up the processing of permit requests. "We want people to have heat in the winter," he said.

Exceptions possible without environmental permit

If a district heating provider cannot procure the necessary treatment facilities, exceptions can be made to retain heat generation, Tatar offered.

"Exceptions can be used after notifying the Environmental Board and the local government that can declare a heating emergency," the deputy secretary general said.

The board can also suspend the obligation to observe emissions norms of operators of devices with an output of over 50 megawatts if it proves impossible because of using a different fuel and retaining energy supply is critically necessary. "Clearly, retaining district heating is necessary in this context for consumers to be able to survive the heating season."

Lack of fuel can also be grounds for an exception. Operators of furnaces with an output of between 1 and 50 megawatts can apply for an exemption from the obligation to observe emissions norms for up to six months if they can prove they lacks gas supply contracts for the entire heating season, which is why using other fuels is the only option.

Heating providers are obligated to notify the Environmental Board as soon as they develop gas supply problems. Only the local government can declare a heating emergency.

Any decision to invest in alternative fuel entails expenses, which might lead heating providers to seek higher prices. This would have to be coordinated with the Competition Authority.


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Editor: Marcus Turovski

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