Options to reduce electricity use scarce for large consumers

Electricity transformer (photo is illustrative).
Electricity transformer (photo is illustrative). Source: Priit Luts/ERR

In the current economic climate, Estonia's biggest electricity consumers, including a wide range of industrial companies, retail chains and food producers, are looking for ways to cut down on energy use. However, reducing energy consumption may be more difficult for large consumers, and, unlike domestic consumers, they cannot expect to receive state support.

Due to commercial confidentiality the precise list of the largest electricity consumers cannot be disclosed either by electricity providers or the state.

However, according to previous data, the largest electricity consumers in Estonia have included Imatra Elekter, Enefit, Horizon Pulp and Paper Ltd., Telia Estonia, VKG Oil, Kunda Nordic Tsement, Tallinna Vesi, Hkscan Estonia, Rimi-owned Kinnisvaravalduse AS, VKG Energia, Silmet, Vopak E.O.S, Eesti Energia, REPO Vabrikut, Saint-Gobain Glass and Elme Messer Gaas.

Since prices began to rise, Estonia's biggest energy consumers have been looking for ways to save electricity. One approach, hinted at by the government, involved refraining from electricity use during peak hours. However, due to the need to keep equipment running around the clock, or because of the amount of time required to temporarily halt production, many are unable to schedule their energy consumption in this way, as easily as domestic customers.

One of Estonia's largest electricity consumers is AS Estonian Cell, which produces aspen wood pulp. While the company has cut back on electricity consumption in recent months, the only efficient means of continuing production requires its pulp mills to be in constant use.

In cases like this, companies' constant need for electricity also increases the price of its services and products.

According to Mihkel Kõiv, head of Telia Estonia's technical department, the company purchases electricity in different ways, partly under a fixed contract and partly at the exchange price.

"Due to the nature of our business, where various IT systems, data centers and networks have to operate 24/7, we are not in a position to 'time' our electricity consumption in the way that households are advised to do," Kõiv said.

"So, of course, our operational and service costs are also affected by the sharp rise in electricity prices," he explained. According to Kõiv, Telia has, over the years, tried to make its electricity consumption as efficient as possible and adopted more sustainable forms of technology.

Northern European food company HKScan, is also among the biggest electricity consumers in Estonia. However, the company's Baltic finance director said, that so far, the company had not received an offer of a fixed price on electricity from providers.

Water utility company Tallinna Vesi announced last month, that, as electricity accounts for 25 percent of its production costs, price rises for customers would also come into effect from October. The price increase is expected to bring Tallinna Vesi around €1.4 million in additional sales revenue this year.

Maria Tiidus, Tallinna Vesi's head of communications, said, that this puts the company in a difficult position, as one of its main production costs cannot be predicted in the long term. "This affects our need for flexible energy management," Tiidus said, adding that, along with the aim of reducing the company's environmental impact, this provides a further reason to reduce energy consumption.

Tallinna Vesi has recently introduced automated systems to schedule electricity consumption according to times when prices are at their lowest. However, this does not solve the problem entirely. "This ability to manage consumption is still quite limited today. Biogas produced at the wastewater treatment plant, which we use to heat our buildings and in the wastewater treatment process, also plays an important role in energy consumption," said Tiidus.

Shops considering cutting costs at expense of opening hours

The Rimi supermarket chain, which made a profit of  €7 million last year, is considering reducing store opening hours in some locations in order to cut down on energy consumption.

According to Vaido Padumäe, the company's CEO, energy costs have also increased by nearly €7 million this year. "It's worth looking at our profits from last year and drawing conclusions from that about the challenges we face today," he said.

Rimi plans to save energy by investing in new, more energy-efficient equipment as well as automating work processes. "With these measures, energy savings could be close to 30 percent more than during the previous period," Padumäe said.

"In addition, we are currently in consultation with the centers where Rimi stores operate. Possible shortening of store opening hours is under discussion. We see an opportunity for energy savings here as well. Of course, we will assess this on a case-by-case basis, taking into account the location of the stores as well as sales. Early morning and late evening opening hours are particularly under consideration," said Padumäe.

"The increasing cost burden in recent months is forcing all retailers to take this into account in their pricing. However, it is certainly not correct to say that such high additional costs will be reflected in full in our prices (for customers)," said Padumäe.


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Editor: Michael Cole

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