A waste management scandal has erupted in Keila, as residents are now paying the highest garbage collection fees they've ever seen for December.

"Take a building with 75 apartments as an example. Last month, the invoice, including VAT, was €202. This month, it was €989 with VAT. On average, that's an increase of 4.7 to 4.85 times per customer," explained Igor Onkel, a board member of real estate manager Keila Haldus.

"For a building with eight apartments, last month's bill was €24 with VAT. This month, it was €126 with VAT," he added.

The problem began a few years ago when the then-service provider, Ragn-Sells, raised garbage collection prices in Keila, citing rapid inflation as the main reason. However, a competing company, Eesti Keskkonnateenused, argued that Ragn-Sells' initial winning bid had been below cost and that the price increase was built into their plan from the start.

"You have to give credit to the competitor. I believe Ragn-Sells will exceed their 2025 profit target within three months. If you look at these prices, there's clearly no economic justification for them, no matter how you look at it. Even in a free market where some risks may be higher, these prices are simply far too high," said Argo Luude, a board member of Eesti Keskkonnateenused.

The city found the new prices too steep and, by mutual agreement, terminated the contract with Ragn-Sells. Eesti Keskkonnateenused was expected to take over waste collection from December, but the company announced it would need three months to prepare.

"Upon signing the contract, Eesti Keskkonnateenused informed us that they needed a longer preparation period and would only be ready to start services on March 1," noted Keila Deputy Mayor Inge Angerjas.

To ensure waste collection wasn't completely interrupted in the meantime — given the limited number of service providers in the market — the city made an emergency temporary contract with Ragn-Sells, this time at the company's proposed rates.

"Yes, Keila currently operates under a free-market waste management system. In a free market, companies set their own price lists and the city has no way to influence those prices. But yes, we simply have to endure this period," Angerjas said.

"We are actively working on this issue daily and are considering ways to compensate residents for the price hike, particularly for the collection of sorted waste. We've also taken other measures, such as increasing the frequency of waste pickups from public packaging containers, where people can dispose of waste for free. And we have more ideas," Angerjas added.

However, with the help of the competing firm, Eesti Keskkonnateenused, it was determined that the original contract's early termination with Ragn-Sells should have meant that residents continued to pay lower rates for an additional three months. This implies that residents could be entitled to a refund for part of what they've already paid. Ragn-Sells disagrees with that interpretation.

"It is possible to claim a refund for the period from when Ragn-Sells first raised its prices — roughly from early 2024 until December 2024. People and businesses can request refunds for the interim price hike based on submitted claims. However, for the rates that took effect from December 1, there is no option for anyone to request a refund," explained Ragn-Sells CEO Kai Realo.

Starting in March, prices are expected to drop.

"The price will be more or less the same as before Ragn-Sells introduced these record-high rates in Keila," said Luude, though he acknowledged there may be slight variations.

"There might be minor differences due to varying container sizes, but overall, the differences will be very marginal," he noted.

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