Utilitas CEO: Crucial that offshore wind farms decision made in next year
If Estonia wants to stay competitive in the construction of offshore wind farms and have a facility built by 2030, it needs firm decisions from the state in the coming year, head of energy company Utilitas says.
Utilitas' activities include district heating – centrally controlled hot water piped in to many apartment blocks to provide warmth during the winter months – and supplies the capital with this service.
Appearing on ETV politics head-to-head show "Esimene stuudio" Thursday, Priit Koit, CEO of Utilitas, said determination is needed to carry out the green transition, which the state must facilitate.
Koit said: "The question is, where we want to be in the end. Do we want to be a part of the Nordic countries, do we want to be part of a region that has good economic growth potential from a global perspective. Or do we want to be in some other group, and what will that be – there are no good options here."
Estonia is with many other countries in the construction of offshore wind farms, and for the next three years, and time-slots for laying the foundations for offshore wind farms have been booked for the next three years, Koit went on.
"If we are talking about building in 2027, 2028, we could still manage that, but it would require a quick decision next year."
Koit said tackling the issue in the same way one does with a conflict is one way of doing this, ie. acting quickly "because otherwise we are lagging behind in the competition."
At the same time, Utilitas has been using fossil fuels – shale oil has made a resurgence in the current energy crisis at a time when natural gas prices are soaring – as well as wood chips, which are not nowadays seen as an environmentally friendly fuel.
Some larger concerns such as Tallinn Airport have started using district heating instead of buying their own natural gas supply for heating.
Three basic criteria must be met in the energy sector: Ensuring security of supply, doing this at a reasonable price and also carrying it out in an environmentally friendly manner, he said, adding that at different times, the three criteria vary in their relative importance to one another.
In the current crisis, security of supply outstrips the other two criteria, he said.
However, it is key to note that whereas district heating in Tallinn relied purely on natural gas as a fuel in 2008, nowadays, 70 percent of the total comes from other sources – wood chips and shale oil as noted, but also refuse, and from cogeneration plants (where hot water created in the process of, for instance generating electricity, is put towards district heating – ed.).
Naturally wind energy is more environmentally friendly, but it also brings with it solutions to the supply criterion noted above.
Koit said: "Estonia has the opportunity to become an electricity exporting country once again /.../ The Estonian solution could and should be offshore wind farms. This is a way of adding to large-scale energy production."
At the same time, again, this required action now, he said.
"In practical terms, if we want to achieve this goal by 2030, we have to look at what the practical possibilities of building production capacities are," he went on.
One issue with wind farms currently being developed is that many of them are located too far from the existing grid for developing them in this decade to be a wise move, though at the same time, it would not be wise to scrap them either, as they may be needed in the future.
As for wind farms closer to the grid network, the wind farm planned for the Gulf of Riga could be ready before 2030, if the right decisions are made, he said.
"These projects, which are in the Gulf of Livonia, are close to the grid, and if we proceed with the decision next year, they could be ready by 2028-2029. Maybe we would actually be able to meet these goals, and this would be the fastest way."
The price per-megawatt-hour of electricity produced by offshore wind farms should rise to around €60, he added.
Utilitas built its first wind farm in Latvia Koit said, a country where, as is the case in Lithuania too, does not have sufficient production capacity, which drives up the price of energy in Estonia.
"Perhaps the wind farm built in Latvia will also help the energy supply in this case. But the truth is, too few new capacities have been built anywhere in the region," Koit said.
Latvia and Lithuania have made faster decisions to accept plans than has Estonia, he added.
As for oil shale, time will tell whether the plants which burn it to generate electricity will be retained as a reserve or replaced by new technology, Koit said.
In terms of district heating, the use of shale oil is easier to implement than other areas, he added.
Utilitas is an Estonian energy group engaged in generating thermal energy and electricity, as well as providing district heating services, the company says on its website.
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Editor: Andrew Whyte
Source: Esimene stuudio