Renewable Energy in Estonia

Raul Potisepp, Estonian Renewable Energy Association

14.05.2014

Established in May 13 2011

14 members incl 5 associations

EREA´s introduction

Estonian Biogas Association

Estonian Solar Energy Association

EREA´s introduction

4

H&C productionElectricity production

Electricity and heat production in Estonia, 2010

Energy consumption:

All sectors Households1

2

Soojus38%

Elekter23%

Transport20%

Muu19%

Kokku

Soojus58%

Elekter16%

Transport

26%

Kodumajapidamised

Estonia first country to fulfil its 2020 RES directive target (25%)

Biggest growth in RES-H&C sector, 2020 NREAP sectoral target was already exceeded in 2009

RES-E growth above the trajectory, from 2% in 2008 to 12,3% in 2011

RES-T still non-existent

State of Play of RES in Estonia

Biomass49%Wind

46%

Hydro2%

Biogaas3%

Solar0%

Renewable energy (electricity production) in 2013 (GWh)

Renewable electricity production 2009-2013 (GWh)

0

200

400

600

800

1000

1200

1400

1600

2009 2010 2011 2012 2013

Taastuvenergia elektritoodang 2009-2013 (GWh)

RES-H&C potential often underestimatated

Growth due to combination of various reasons: fuel prices, targeted support measures

Good potential for further increase

State of Play of RES-H&C in Estonia

State of Play of RES-H&C in Estonia

810 10 9 10

12

21

3332

30

32

40

5 6 67 8

910

14 13 14

1618 18

6 6 7 7

8 8 8

10 1113 13 13 13

0

40

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Gas Woodchips Sod peat Milled peat

EVOLVEMENT OF FUEL PRICES IN ESTONIA 2001-2013 (€/MWh)

369,4 MW RES-E capacities at the end of 2013

Until 2007 investments were non-existent, RES-E share in final energy consumption only 1,5%

In 2007 new FiP scheme was put in place

Fastest growth in 2009 with 107,5 MW of added capacity

In 2011 12,3% of electricity was produced from RES

MW

State of Play of RES-E in Estonia

Addition of new capacity:

0

20

40

60

80

100

120

140

2002 2005 2007 2008 2009 2010 2011 2012 2013

Uued tootmisvõimsused

0

100

200

300

400

500

2002 2005 2007 2008 2009 2010 2011 2012 2013

Taastuvenergia võimsuste lisandumine

Installed capacity by source:

2%

73%

0%2%

23% Hüdro

Tuul

Päike

Biogaas

Biomass

Estonia´s NREAP 2020

RES directive sets Estonia´s target at the level of 25% (18% in 2005)

NREAP sectoral targets:

RES-HC from 2005 31,3% to 38,4% in 2020,

RES-E from 0,1% to 17,6%,

RES-T from 0% to 10%

Power to the people:

• Microproducer is an electricity producer who has a generating capacity up to 11 kW.

• Simplified access to grid.• Before 2012, virtually non-existent, became

popular after investment subsidy scheme (Kredex)

• First microproducer joined the grid in 2012 • 2012: 17; 2013: 121;

• Alltogether: 2014 – ca 200 microproducers (87% PV panels)

• Interest for microproduction is great – recent survey in Estonia 71% of respondents said they are interested in PV panels.

• Average capacity – 7 kW• Total capacity – ca 1 MW

Transportation sector:

• RE share in transportation sector is 0.2%• Measures to achieving 10% RE share in sector: • Nationwide electric-vehicle charging station

network (First in the World)• Up to 18 000 euros rebate, when buying electric-

vehicle. • 51,4 MEUR EU funds to develop biomethane • Blending requirement introduced in coming years

Overview of major RES policy changes in Estonia 2007-2013

RT I 2007, 66, 408 - Move to feed-in premium based sustem. Renewable energy producers receive 53,7 Euro/MWh on top of electricity market price. Under the Electricity Market Act §591, for wind energy producers capacity triggered reduction on support is set at 400 GWh of electricity produced annually.

- Efficient CHP (from fossil fuels - waste, peat, natural gas and retort gas from oil shale) receive 32 Euro/MWh on top of market price

- Quick take up of renewablesRT I 2010, 8, 40 - Wind energy producers capacity triggered reduction (CAR) in support is increased to 600 GWh

annually.RT I, 28.06.2012, 1 - retroactive reduction in support!

- the amendment to the Electricity Market Act excludes the consumption of electricity and heat by the energy branch for electricity and heat production from the support mechanisms. Renewable CHP producers incur losses on average of 10% from the previous support levels.

draft 318 SE - retroactive reduction in support!

- abolishment of remuneration option for RES-E power generation based on market price + feed-in premium, applicable to both existing and future projects above 10 MW and for all wind energy projects

- change of the mechanism of indexation of the RES-E remuneration to the electricity prices. Producers using Renewable energy producers with a capacity above 10 MWe and all wind energy producers – FiT 93 €/MWh. Producers using natural gas (up to 10 MWe), retort gas, peat and municipal waste in efficient CHP regime with a capacity above 10 MWe – FiT 72 €/MWh

- Annual capacity triggered reduction in support for all renewable energy prodcuers, in essence moratorium for new capacity.

Other existing and future support schemes

Incentives

Measure Conditions2014-2020

District heating support programme

- 71 Million EUR, concrete conditions to be adopted during

next 6 monthsv

Rural communities programme

- 33,3% of applicable cost, up tp 6500 EUR

- Micro RES systems- www.eas.ee

V

Production of alternative fuels (mainly biomethane)

- 51,9 Million EUR, - concrete conditions to be adopted during next 6 months

V

Incentive for promoting small-scale renewables

- 5 Million EUR, - concrete conditions to be adopted during next 6 months

V

Investment support for production of bioenergy

- 5 Million EUR, - concrete conditions to be adopted during next 6 months

V

Civil society’s attitude towards RE:

• Climate change issue• Renewable support scheme – separately on

electricity bill • Negative image of developers ( Hiiumaa

example) • Towards microgeneration totally different

attitude

Hüdro0,2%

Biomass CHP

18,6%

Biogaas5,9%

Tuul maismaa

11,5%

Väike tuul0,3%

Tuul avamere

51,1%

PV0,5% PHAJ

11,7%

Biomass CHP44%

Biogaas CHP3%

Bio katlad24%

Soojuspumbad13%

Puit: lokaal14%

Päikese kollektorid

2%

100% Renewable energy – action plan

Electricity sector Heating (and cooling) sector:

Conclusion

i.Estonia has had a very good progress, 1st country in the EU to fulfil its 2020 RES target

ii.The potential of renewable energy in Estonia is still largely untapped

iii.Policy framework matters, without the good framework the growth wouldn´t had been possible

iv.Due to the retroactive and other (potential) changes in the regulatory framework the growth has stalled and prospects remain bleak

Thank you!

Estonian Renewable Energy AssociationRaul Potisepp

Raul.potisepp@taastuvenergeetika.eewww.taastuvenergeetika.ee

Powerstations in Estonia: