"The Kiisa plant is currently in operation as a standby power plant, and Elering is not allowed to offer it to the electricity market. Together with Elering, we are analyzing the options and assumptions for making the plant available to the market. In any case, the prerequisite for putting the plant on the market is that doing so would bring down the electricity price for consumers," Deputy Secretary General at the Ministry of Climate, Jaanus Uiga told ERR.

Uiga added that the analysis will be completed in March.

"This indicator is actually very simple. We calculate, the price if the Kiisa [plant] were to be used on the market, and how much it would make the market price [of electricity] more favorable, so, if it would and by how much," Elering CEO Kalle Kilk told ERR:

"There are bound to be some negative effects, and these pros and cons have to be weighed up. The presumption is that it is only worth our while doing it if the move will make the final energy cost more affordable for the consumer," said Kilk.

Kilk also provided a rough estimate of the price of electricity produced at the Kiisa gas power plant, which he said would be around €130-150 per megawatt-hour (MWh). Last year and in 2023, Kilk said, the number of hours when the price was above that level was around 700-800.

At the same time, however, additional costs also need to be taken into account when it comes to commissioning the Kiisa plant, Kilk stressed.

"[But] what we don't know yet is that the market price will definitely go down. There will be other costs that will potentially go up," he said.

"For example, until 2028, this power plant will be used as a back-up. We have been given permission to buy less reserves from the market for this plant. So, to the extent of 250 megawatts, we don't have to buy reserves from the market, we have it in-house and the cost of buying it is actually eliminated. That is a minus. So, our preliminary assessment is that until 2028, it may not be a reasonable move in terms of the final price. This is precisely because it would increase the cost of the reserves if we had to buy those reserves from somewhere outside. And that will probably mean they increase more than the amount gained would be from a change in electricity prices," Kilk continued.

"These are the nuances that the analysis has to show, whether it is reasonable and when it is reasonable," the Elering CEO admitted, adding that only after this is clarified will it be worthwhile to start looking into whether and how to change the ownership of the Kiisa power plant, as well as other related issues.

Kilk also agreed that bringing the Kiisa plant onto the market would affect the procurement of frequency reserves. That is another reason why the analysis needs to be completed before companies considering participating in the tendering process submit their bids.

"It will certainly have some impact and it is one of the things that this analysis, from our point of view, will have to come up with by March," he said.

On Thursday, the government discussed possible ways to mitigate rising energy prices. Prime Minister Kristen Michal (Reform) said one possibility could be to bring the emergency power plant in Kiisa onto the market.

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