Among other things, the Ministry has identified the overall reduction of emissions through the transition to cleaner energy as an important direction of the climate resilient economy act, which is being drafted by the Ministry.

The goal is for the public sector to phase out fossil fuels by 2040 (except in areas where there are no technological alternatives); that electricity generation with security of supply will be CO₂-free by 2040; and that heat generation will be CO₂-free beginning the same year.

Likewise, new mineral extraction permits will only be issued for the extraction of oil shale for use in the production of oil shale chemistry or other products that cannot be utilized as fuels or energy carriers. Shale mining permits that have already been given can be used until they expire.

In larger cities, public transportation will be zero-emissions by 2040, with taxis transitioning to zero-emission or electric cars by 2035. By the same year, the public sector fleet will switch to zero-emissions or electricity as well.

Domestic ferry traffic will be zero emission by 2040.

Permits for the introduction of new technologies will be simplified and accelerated. In addition, 30 percent of the proceeds from the government's sale of CO₂ will be used for private sector investment in new technologies and energy efficiency.

It also sets a target for 25 percent of public procurement to include CO₂ emissions as one of the evaluation criteria by 2030.

In the case of forestry, the objective is to establish a uniform felling rate that does not exceed the net increment of commercial forests, i.e. the reserve of commercial forests is not reduced as a result of felling. A specialized alternative for establishing forest plantations will be developed to provide increased availability of resources for long-lasting wood products and wood chemistry.

The grounds for obtaining peat extraction permits will be altered, resulting in a 12 percent reduction in CO₂ emissions from peat production by 2030. Permits for peat extraction will be issued conditionally upon large peat refining in Estonia beginning in 2035.

Gas plants running on natural gas until 2040.

According to the new law, the energy industry will be required to pay the largest contribution so that the CO₂ emissions released can be used by potential new sectors.

The executive summary of the draft states that it is also possible for industries to come to Estonia that may be emission-intensive with today's technologies, but whose products contribute to the goals of a climate-resilient economy.

Under the new law, greenhouse gas emission reduction targets are -37 percent by 2030 compared to 2022 (-85 percent compared to 1990); -45 percent by 2035 compared to 2022 (-87 percent compared to 1990); and -84 percent by 2040 compared to 2022 (-96 percent compared to 1990).

The targets are based on the assumption that 1,200 megawatts of gas-fired power plants will be added to the electricity system by 2030 to ensure security of supply. These plants will initially run on natural gas and from 2040 on alternative fuels, i.e. CO₂-free.

It concludes that after 2040, natural gas could be replaced by biogas or hydrogen, or carbon capture devices could be used in plants as they become carbon neutral.

In addition, it is estimated that all electricity and heat production will be CO₂-free by 2040 at the latest.

The goal is to produce the same amount of renewable electricity as Estonia's total consumption by 2030.

An emissions buffer will be created for new industries.

The summary of the bill states that Estonia welcomes new industries that contribute to a climate-resilient economy. To this end, a large so-called "emissions buffer" is left in the law. The oil shale industry is expected to be the largest contributor to this buffer, accounting for nearly three-quarters of total industrial emissions in 2022.

For this reason, the law sets emission reduction targets for the oil shale industry and other industries separately, so that a large buffer in greenhouse gas emissions can be created when new facilities are established in Estonia.

Greenhouse gas emission targets for the shale oil industry are to increase emissions by up to 40 percent by 2022, 12 percent by 2035, and 16 percent by 2040 from 2022 levels.

The targets for other manufacturing industries are to increase emissions by up to 116 percent by 2030, 62 percent by 2035, and eight percent by 2040 from 2022 levels.

The text of the bill has not yet been finalized, so it is not possible to say whether the targets will be written into law in this form.

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