At the government's weekly press conference on Thursday, Climate Minister Yoko Alender (Reform) said the government has reviewed the ministry's data and decided to cancel the planned support of up to €2.6 billion for offshore wind.

The ministry still has no intentions of sharing the data publically.

The unexpected decision means that by April, Estonia will lose its state aid permit for offshore wind support, meaning no offshore wind farms will be built under this approval. However, Alender said that she and the ministry still plan to continue developing offshore wind.

"We see opportunities to negotiate further with the commission specifically to bring new offshore wind capacities to Estonia. Conditions that would ensure the most favorable solution for us as a state and for our citizens," the minister said.

"Our proposal is to enter these negotiations and obtain a new state aid permit with the best possible conditions. The timeframe of the current permit is simply too short," she noted.

Alender estimated that after obtaining a new permit, the Ministry for Climate could launch an offshore wind auction at the beginning of next year. "The parks will be able to start operating within the same schedule we have planned, meaning by the end of 2033," the minister stated.

Alender does not intend to resign

The minister denies she plans to resign. "No. I intend to work to ensure that Estonia's energy sector is sustainable, affordable, and secure. And I am also confident that all these steps will lead us there," she said.

The government plans to proceed with the onshore wind farm support measure according to the initial plan. This would see up to two terawatt-hours added to the market with funding totaling €240 million. The auction is planned for April.

The ministry is also moving forward with proposals, legislation, and a special plan for establishing a nuclear power plant. Alender said an analysis of storage capacities is planned.

By April, the ministry will prepare an analysis on whether the state should support the Paldiski pumped hydro storage facility or a larger battery park.

Läänemets: Clarifications have been made

Social Democratic chairman and Minister of the Interior Lauri Läänemets said various information is circulating about wind farm subsidies. However, the ministry has managed to clarify the situation somewhat.

"The documents reviewed in the government today are already significantly clearer. I commend the Ministry for Climate, things are becoming clearer, and it is much easier to understand the situation," he said.

Läänemets said it is important for the state to develop the energy system so that production is as decentralized as possible due to potential wartime threats.

He opposes a nuclear power plant for the same reason. While Russia does not attack nuclear plants, it could target a nearby substation which would cut the supply to the electricity grid.

Eesti 200 changes view on onshore wind

Former leader of Eesti 200 and Minister of Foreign Affairs Margus Tsahkna said his party wants to see the full picture before making decisions.

"This is not a decision that can be made overnight. It has an enormous impact on our overall competitiveness. The whole picture needs to be put together, including storage solutions or whatever else may come in the future," he said.

Tsahkna said Eesti 200 is more inclined to support onshore wind.

"It does not require a long-term system of special subsidies. It is more or less feasible under market conditions," the minister told the assembled media.

Background

In January, following lengthy debates, heads of the three coalition parties (Reform, SDE and Eesti 200) decided to support a renewable energy development scheme, which will see Estonia subsidize 2 TWh of onshore and 2TWh of offshore wind power. The latter is 10 times more costly to develop.

According to the coalition's agreement, Estonia is willing to pay offshore wind developers a total of €2.6 billion in subsidies for whenever the market price of electricity falls below €65/MWh.

The coalition has so far failed to produce calculations to demonstrate how this would ensure promised cheaper energy prices or what it's forecast of Estonia seeing a major boost in energy consumption over the next decade is based on.

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