Estonia's onshore wind auction goes live
The reverse auction has an annual volume of one terawatt-hour and the option to increase the procurement to two. The government will pay support to wind farms for 12 years after completion, at a maximum rate of €20 per MWh.
On March 20, Minister of Energy and Environment Andres Sutt (Reform) signed a directive announcing a reverse auction for onshore wind power. This is the sixth such auction and, according to Sutt, the last in the current series.
The auction is open to new wind farms — projects that will begin generating electricity only after the winners are announced. Production must start no later than December 31, 2030, though it may begin earlier.
Winners of the auction will receive support for up to 12 years, with a maximum subsidy of €20 per megawatt-hour produced. No support will be paid during any 15-minute trading period when the electricity exchange price exceeds €45 per megawatt-hour.
Based on calculations, procuring one terawatt-hour of annual production would mean a maximum annual subsidy of €20 million and a total of €240 million over the support period. For two terawatt-hours, this would rise to up to €40 million per year and €480 million in total.
Projects submitted to the auction will be ranked according to which bidder can offer electricity at the lowest subsidy rate. The required bid bond is €12 per megawatt-hour.
The auction will be conducted by transmission system operator Elering and bids must be submitted by August 25, 2026. The winners are expected to be announced by the end of this year.
According to a directive from the Ministry of Climate, Elering must submit a list of compliant bidders to the ministry no later than November 3.
A modeling study commissioned by the Chancellery of the Riigikogu and carried out in 2025 by TalTech found that electricity prices fall as the share of solar and wind energy increases, but the price benefit levels off at around 80 percent renewable energy (including roughly 15 percentage points of biomass). The ministry estimates that reaching this level would require the construction of at least 100 additional wind turbines in Estonia.
Major renewable energy companies have expressed skepticism about the latest auction, noting that the price cap may not cover investment and operating costs.
Previously, the Estonian state has held two large-scale auctions with annual volumes of 0.54 terawatt-hours and 0.78 terawatt-hours.
In the first case, there were 12 winners, with offered prices — i.e., guaranteed revenue rates — ranging from €18.99 to €34.9 per megawatt-hour. In the second, there were seven winners, with rates ranging from €21.89 to €39.8 per megawatt-hour.
Last year, according to data from the transmission system operator Elering, electricity consumption in Estonia totaled 8.3 terawatt-hours, while production reached 5.3 terawatt-hours.
Renewable energy accounted for 3.6 terawatt-hours or 68 percent of total production. Wind power contributed 1.3 terawatt-hours (14 percent more than the previous year), while solar power generated 1.1 terawatt-hours (12 percent more).
The share of renewable electricity in total consumption rose from 39 percent in 2024 to 41 percent.
--
Editor: Marcus Turovski, Huko Aaspõllu
