Michal told ERR that he did not want to comment further on the wind farms until decisions had been made. However, at Wednesday's Eesti Päevaleht energy conference, Michal presented a plan that differs significantly from those previously put forward.

In the fall, the Ministry of Climate proposed for a discussion, a reverse auction for 6 terawatt-hours of renewable energy generation. According to that proposal, the price cap would be the same,  whether the bid was for an offshore or onshore facility. The main aim being that the electricity reaches the grid in 2030.

The price floor means that if the price of electricity falls below a certain level, the state will pay the producer the difference. Offshore wind farm developers said the measure favored onshore wind farms.

On Thursday, Michal unveiled a new plan, according to which, two separate rounds of small tenders would be organized. According to the plan, four terawatt-hours of generation would be expected by the end of 2029 and the same amount offshore by the end of 2033.

Social Democratic Party (SDE) leader Lauri Läänemets said that Michal's plan needed to be improved. One of the SDE's main concerns, according to Läänemets, is the ambition, currently written into law, to cover 100 percent of Estonia's average annual electricity consumption using renewable energy sources.

"At the moment, there is talk that maybe it should be longer. We think the ambition has to be maintained. Another question is whether subsidies should be paid for all energy production or only for the production that is used in Estonia," Läänemets said.

Läänemets said the climate ministry hopes the condition would encourage developers to produce storage capacity.

"There is also a different assessment, that those who would be potential developers of storage technologies also say that there will not be any storage capacity on top of that. If, by chance, this leads to the company taking risks and having to find the money, then ultimately the business plan could end up being more expensive. And that's the debate," said Läänemets.

That is one of the reasons, he said, why there needs to be a discussion on whether there is a need for a separate support scheme for storage capacity.

The principle that price floors for offshore and onshore wind farms should be separated seems to be supported by both the SDE and Eesti 200.

According to Läänemets, a possible support scheme would include both a price floor and price ceiling. He confirmed that the memo presented by Michal had stated around €100 million would need to be paid out annually under the scheme.

"But the question is not how much we will pay in subsidies, the question is what the final price of energy is for the consumer. Everyone's goal is to end up with an energy price that is cheaper for people and businesses. It does not make sense to simply look at the subsidy amount and the size of the renewable energy charge. That only tells one side of the story. In the end, the question is what is the final price," Läänemets said.

Läänemets agrees that greater competition for onshore wind would probably mean having to pay less in subsidies.

"The question is again about the final price, because in winter, there is no onshore wind, which means the price of energy goes up. And if we now have offshore wind farms, it will be more expensive, but there will be more wind during that period. Together, the two balance each other out, giving the best and cheapest price," he said.

Which offshore wind farm projects will be completed by 2033 depends on a number of variables. Currently, the most advanced are plans for a 1,200-megawatt Utilitas Wind farm in the Gulf of Riga, which could be completed before the end of decade, according to the company's CEO Rene Tammist. In the same time frame, Enefit Green is also discussing its own 1,000 megawatt wind farm.

In addition, Saare Wind Energy, which is planning a 1,400 megawatt wind farm, has done a considerable amount of exploratory work near the west coast of Saaremaa.

According to Tammist, the four terawatt-hour support mechanism would accommodate about one terawatt of offshore wind farm capacity. However, this would not mean that the best bidder in a possible tender process would definitely get the full subsidy amount.

"It will depend on how developers lay out their plans. It can also not be ruled out that a certain amount of electricity will be sold under long-term contracts. Or they could take a risk and produce a certain amount of electricity for the market. It will depend on the strategies chosen by different developers," Tammist said.

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