Estonia's 2013 renewable energy charge to shrink 10%

Dec 4, 2012 - Estonia's transmission system operator Elering said last week it estimated the 2013 renewable energy charge for consumers at EUR 0.0087 (USD 0.011) per kWh, a decline of 10% on 2012 figures.

Through the renewable energy fee electricity consumers finance the subsidy paid to renewable energy producers. Elering collects the fee, which is subject to value added tax (VAT), from consumers and pays out the subsidy to electricity generators.

According to its forecast, next year the amount of electricity generated from renewables and in combined heat and power (CHP) stations will increase to 1,278 GWh, suggesting a subsidy pay-out of EUR 65 million. Wind power accounts for 43% of the payments for renewable electricity, biomass power plants with more than 20 MW of capacity for 38% and other sources, including hydropower, waste incineration and biogas, for 19%. The subsidy for electricity produced in efficient CHP stations stands at EUR 5.8 million.

The amount of wind capacity eligible for subsidy is expected to surge 84%, while electricity produced from biomass is forecast to decline 55%. The output of efficient CHP plants is set to rise 43%.

Elering's chairman Taavi Veskimagi said that the calculations were based on existing legislation and that the fee would be recalculated if the law was changed. The Estonian parliament is now working on amendments to the Electricity Market Act that would change the size and structure of renewable energy subsidies. Veskimagi also said that Elering had submitted a proposal to make it possible in the future to alter the renewable energy fee at a mid-year stage.

The share of renewable electricity in Estonia is expected to be 12.6% of overall consumption in 2013, exceeding the state target of 11.3% for that same year.

(EUR 1.0 = USD 1.305)

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