The recent sabotage of the EstLink 2 cable proves that energy security is an integral part of broader national security policy. Ensuring security requires a clear plan and strong international cooperation.

In February 2025, a significant change will take place as the Baltic states disconnect from Russia's electricity system and join the Continental European frequency area. This is the most important step of the decade in strengthening Estonia's energy security, a process that has been in preparation for more than ten years.

The damage to the EstLink 2 cable does not change this critical step. Estonia is prepared to disconnect from Russia's electricity grid. Our energy supply relies on domestic production and strategic external connections. Our links to Finland and Latvia are the backbone of market stability and affordable prices.

Of course, we also need more domestic production capacity. Lower prices can be achieved by developing renewable energy sources, in combination with dispatchable capacities, which produce more expensive electricity but ensure supply during periods without sufficient wind or sunlight.

The goal of saboteurs is to weaken European unity and isolate Estonia. Those advocating that Estonia should continue to rely solely on domestic oil shale production while seeking an exemption from the European Union's emissions trading system are effectively pushing us to forfeit the benefits of the common market.

If we were to exit the common market and the emissions trading system, we would no longer be able to buy inexpensive energy from other countries. Our producers would also lose access to foreign markets. Our interest is the exact opposite: to develop production capacity and remain part of a strong and unified European energy market, where shared resources and investments ensure that Estonian homes stay warm, lights stay on and electricity remains affordable.

Role of oil shale in the transition

Oil shale energy will play an important role in Estonia's energy system at least until 2035. Until we develop new dispatchable energy solutions, oil shale will ensure the stability and reliability of our energy supply. In the energy sector, things take time.

The current situation — where the Baltic states lack sufficient production capacity — arose because we blindly relied on oil shale while neglecting all other solutions. The decision-makers of that time, even now, a decade later, are still talking about building a new oil shale power plant or drafting a new oil shale development plan. Unfortunately, neither of these is an adequate proposal. As the saying goes, you don't spit into the old well until the new one is ready — but unlike previous governments, we are actually doing the work to build that new well.

Affordable and clean energy is possible

The year 2024 was a record year for renewable energy in Estonia, with significant growth in both wind and solar power capacity. Despite the fact that EstLink 2 was under repair for seven months last year, electricity prices were lower than in 2023. What's good for the climate is also good for consumers' wallets.

The average electricity price last year was 8.7 cents per kilowatt-hour (kWh). By 2035, Estonia's onshore wind capacity is expected to quadruple compared to current levels. A new offshore wind farm will be operational, along with 750 megawatts (MW) of new dispatchable capacity and energy storage systems capable of storing at least 700 MW of electricity. New connections with Finland and Latvia will also be completed. Combined, these solutions will reduce Estonia's average electricity price by nearly half, to 4.9 cents per kWh.

To ensure energy security, Estonia will need 1,000 MW of dispatchable capacity by 2030 and 1,200 MW thereafter. Until 2040, dispatchable capacity will primarily rely on fossil fuels such as oil shale and natural gas, but the share of renewable fuels — including biomass and biogas — will steadily increase.

Elering is currently conducting a procurement process to bring 500 MW of new dispatchable capacity to the market by 2029, likely through gas-fired power plants. The government will also increase Eesti Energia's share capital to enable the construction of a new dispatchable power plant by 2028. In addition, I have proposed to the government that we bring the Kiisa emergency power plant, currently owned by Elering, to market as soon as possible. A more detailed analysis, which we are conducting in collaboration with Elering, will be presented to the government in March.

After 2040, the goal is to phase out the use of fossil fuels in electricity production where possible and transition to using emission-free local biogas, hydrogen or its derivatives in dispatchable power plants. By 2040, Estonia also hopes to establish a small nuclear power plant with two 300 MW reactors. However, nuclear technology is more suited for stable baseload production rather than for balancing peak demand, for which gas power plants work better.

In summary

Estonia's energy security cannot rely on isolation but must be built on strong cooperation with European Union and NATO allies. The development of renewable energy, securing dispatchable capacity and ensuring reliable external connections form the foundation of an energy system that can withstand any situation. While legacy solutions provide stability today, we must simultaneously build a new, cleaner and more resilient energy system for the future.

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