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Estonian renewable energy developers promise to sue state

Estonian news - etea November 30, 2012

Baltic News Service, 30.11.2012

In case the electricity market bill is endorsed as it originally is, Ulo Parnits, owner of Mainor, along with other wind farm developers have promised to protest the act in court, the daily Postimees wrote on Friday.

Parnits, who is developing two wind farms in the East-Viru County along with two Canadian partners, told the paper that he wanted to bring to a later date differentiation between old and new producers.

In accordance with the Ministry for Economic Affairs and Communications and the Renewable Energy Association, producers who had as of this July 15 a functioning facility, a building license or an agreement for the sale of heat into the Tallinn distance heating network, were preferred in getting a subsidy.

The capacity of the Purtse Wind Farm developed by Parnits and his partners was calculated at 80 megawatts. “We have invested 60 million kroons (EUR 3.8 mln) into these projects. It would be brutal if we must cross out that sum,” Parnits told the paper.

Juhan Parts, Economic Affairs and Communications Minister, said that the intended amendment to the Electricity Market Act meant a cut from the renewable energy fees. But in the opinion of the Competition Authority this could lead to growth in the fees, as the bill is planned to guarantee ten percent as the productivity of the investment to old producers.

In accordance with the analysis of the Competition Authority it is not necessary for the power plant to work in order to get the subsidy, the paper writes. On the basis of the paper the analysis of the Competition Authority shows that the cut in the subsidies would be small. On the basis of the analysis the productivity of the invested capital of the most profitable wood chip power plants should stand above 20 percent.

Rene Tammist, head of the Renewable Energy Association, told the paper that the wind farm owners were planning to sue the government at any rate if the provision of the bill that limits the amount of renewable energy in a year to 600 GWh is introduced. By adding this provision the government moved away from the agreement achieved with the association in the summer.

 

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