Elektrilevi CEO Mihkel Härm said that just as is the case with Elering, Elektrilevi's input prices too are rising, putting a ballpark figure of 10 percent on the likely size of the newly announced fee rise.

"We all know what inflation is like every year. Including this year. We are not talking about a couple of percent inflation here — this year's inflation may come close to 5 percent," Härm said.

Elektrilevi's costs are increasing in roughly the same order of magnitude, he added.

"In order for the network service to be of quality and for all maintenance and other matters to be carried out, we also need to cover the costs. So, in the second half of this year, around autumn, Elektrilevi plans to submit its tariff application to the Competition Authority," Härm noted.

On Tuesday, Estonia's main grid operator Elering announced a desired 36.7 percent increase in the network fee, and Elektrilevi says it has to factor this rise, which Härm called a "quite significant expense," into its own tariffs.

Elektrilevi's reported annual revenue stands at €300 million, while so far €80 million of that has gone to Elering, Härm added.

As to the size of the Elektrilevi fee hike, Härm said this "depends on the extent to which the tariff changes — we have to collect exactly that much more money from our consumers. Put very simply: If Elering's tariff were to rise by 30 percent, that would mean about €25 million — and all of that would have to be collected from our consumers. €25 million compared with our €300 million in sales revenue means nearly a 10 percent rise in Elektrilevi's tariff," said Härm.

However, this has not been set in stone yet. "Our budgeting process begins in August. That's when the figure will become clear. Plus the Competition Authority will also thoroughly review all the cost lines," Härm went on.

Hypothetically, the owner's representatives, i.e., the state, could also call for the hike to be scrapped, and boost Elektrilevi's share capital instead. This would allow the company to operate at a loss.

Härm did not find this an appealing alternative, however. "Covering ongoing expenses through an increase in share capital is probably not a sustainable plan. If we need to make large investments in the coming years and do it through an increase in share capital, that sounds like a very reasonable idea," he said.

Elektrilevi at the end of April announced that it would raise the network fee by an average of 2.6 percent starting from August.

Elektrilevi operates and maintains the bulk of the nationwide electricity grid. Elering, also state owned but separate from the Eesti Energia group, is the national transmission system operator for both electricity and natural gas.

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