Logi sisse:
kasutajanimi parool
25
Oct
2010

17:26

Maybe we should become a power importing state?

Autor: hei.eas.ee
Teemad:

At the end of September, the European Commission made a decision, which did not mention Estonia for a change, but the meaning of which could be unexpectedly important for Estonia. Namely, a commission led by Joaqu?n Almunia granted Spain the right to subsidise its oil shale production for another four years. “It’s a controversial decision that environmentalists do not welcome,” the New York Times concluded.
A few weeks before the decision made by the European Commission, Elering, which is an Estonian state-owned company, submitted a so-called reliability report forecasting how much power will be consumed in Estonia in the next 15 years and what kind of changes will take place in production capacities at the same time. The message of the report is simple and concrete: by 2017, the capacity of Estonian power production will be considerably decreased and, if new investments will not be made, there will be a deficit in production capacities. In 2016–2017, the deficit could be about 900 MW; in the period of 2020–2025, however, it could already increase to about 1,400 MW.

These figures highlighted by Elering are based on a calculation on which power production capacities would be closed in Estonia in the next few years and which ones would be added. We can be quite certain of the ones to be closed: conservation of the block in Iru, conservation of two blocks in the Balti Power Plant, closure of the Ahtme station and, the largest, the shutdown of six blocks in the Narva Power Plant in 2016. The last one is a significant issue, which means the disappearance of 948 MW production capacities.

There is slightly greater uncertainty concerning the capacities that would be added. There will be a combined production plant in Pärnu (in 2011), Enefit oil factory (in 2013), the first block in the Elering’s emergency reserve plant (in 2013), and two new blocks in the Narva Power Plant (about twice 300 MW) in the years from 2015–2017, which will be the largest. “But there is uncertainty concerning two blocks,” the Managing Director of Elering, Taavi Veskimägi, admits. Uncertainty because in the opinion of Eesti Energia the market-based construction thereof is not profitable and there is no permit for state aid from the European Commission. That is where the Spanish coal power station case mentioned at the beginning of the article comes in – it does not give a hundred per cent guarantee to the Estonian state that we can also provide state aid, but in any case it is a case to refer to.

It is a separate issue, of course, about how much and when the Estonian state would be able to help the state-owned Eesti Energia power company. When the European Commission was discussing the Spanish state aid case, the Estonian government was wrestling with next year’s state budget, and it turns out there was still a shortage of money, so they decided to increase returns instead of implementing cuts. “The biggest treasure was again found in the dividends of state companies,” Raimo Poom writes in Eesti Päevaleht. This means that instead of supporting Eesti Energia the hand was pressed into the wallet of Eesti Energia.

There are no independent experts

Energy is an utterly contradictory and complicated issue in Estonia. Bystanders cannot grasp it; there are no independent experts. So-called experts always have their own peculiarities and/or represent the interests and understandings of a clan about where energy should move in the future. There is an enormous amount of unpredictability and loose ends in the issue. The two biggest hindrances are uncertainty concerning the Lithuanian nuclear project (Visaginas nuclear power station) and the fate of the Narva blocks. When these become clear, they will determine further development trends to a great extent, Taavi Veskimägi says.

A few conclusions about Estonian energy as of 2010 can still be made:

Firstly, the deficiency of the production capacity required to cover peak consumption will arrive by 2016. Elering forecasts a deficiency of 900 MW, and already 1,400 MW a few years later. It is impossible to cover such a huge difference in capacities, because there is not enough time to build.

Secondly, as we are talking about the deficit of peak consumption, it does not mean that Estonia will be short in its own production capacities all the time and all year round. Still, there will be periods when we ourselves produce more than we are able to consume and, therefore, we are also able to export power in the future. By the way, the current production capacity in Estonia is about 2,200 MW, but the all time consumption record at 17:40 on 27th January of this year was 1,577.5 MW.

Thirdly, the only way to compensate the deficit occurring in 2016–2017 is to import power. That meets the European Union understanding about the future of energy (a functioning electricity market and good connections) and that development trend has also been decided in Estonia (Estlink 2, connection to the Scandinavian electricity market). Unlike building new power production units surrounding a lot of uncertainty, there is consensus on connections and the money is available. These will be built.

Fourthly, in the end the question goes back to whether we agree with the situation where there are moments in our power consumption when we ourselves are not able to produce enough and we import power instead. Or we say that no, such a situation is not right; it is just a temporary solution and Estonia nonetheless has to build more production capacities to cover the occurring deficiency, whether to completely or at least considerably decrease that deficit. Now we have chosen the second path. According to the national development plan, Estonia must be also able to generate its own power during peak consumption.

Time flies, but there are still no solutions. Estonia has been lingering here itself, but partially these are the external factors independent from us that are to blame. Are the Lithuanians are able to build a nuclear power station? Would Europe also be able to develop a single market in energy? What happens to state subsidies and favouring local power at European level? When these questions are answered, the decision will be for us to be made.

Currently, the state of Estonia has foreseen in the development plans that Estonia must itself be able to produce the power required for peak consumption. There is an image in the heads of many energy fanatics about Estonia as a huge power exporter. That is an extremely expensive objective of doubtful value. Would it really be feasible to spend 30, 40, or 50 billion kroons in grants, subsidises, and support in any other ways to be able to produce the entire power required for a rare January cold on the surface of Estonia. At the same time knowing that we do not need that production capacity for the majority time of the year and knowing that the production capacity might not be competitive without state aid for most of the year.

Maybe it is also more reasonable and less risky to build Estlink 3 and Estlink 4 in addition to Estlink 2, and just import power in times of peak consumption. And if we really build new capacities, be they nuclear power station, cow manure burning, or new power wind turbines, let them be made solely for business purposes and without the support of the tax payers. If it is feasible, build. Eesti Energia wants a nuclear power station. Why not, please invest, but do not put your hand in the wallets of the taxpayers.

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