Minister of Energy and the Environment Andres Sutt said on the "Esimene stuudio" evening talk show that Estonia supports making the price of emissions trading units more predictable and stable.

"This is certainly in our interest and as for fundamentally overhauling the emissions trading system — let alone abolishing it — there is no need for that. In fact, there is no broad political support for it. I think there are actually quite a lot of countries that want the price to be more stable and predictable. I would even venture to say a fairly large majority," Sutt said.

However, Rain Epler believes changes to the ETS system are definitely needed.

"Andres was somewhat cautious in his response and I understand that because his colleague, the prime minister, also said from the Riigikogu rostrum that of course something should be done with ETS, but before we decide what to do, we are waiting to see what Brussels says we should decide," Epler said.

Prime Minister Kristen Michal said in February that Estonia sees change as necessary.

"Since the price of ETS units is quite speculative and not predictable, the system should be reviewed. Various proposals have been put forward. There has been talk of a price cap, of adding more units to the system — all these options exist. I, along with other heads of government, have asked the European Commission to present an additional analysis of the ETS system in the spring or summer, after which we can assess proposals to change the system," Michal said at the time.

EKRE, however, submitted a bill in the Riigikogu that was ultimately voted down.

"We submitted a draft bill proposing that Estonia could take a step and domestically abolish the obligation for companies that currently have to purchase these quotas. In addition, I would remind you that we proposed the government, through a draft bill in the Riigikogu, to enter into negotiations with neighboring countries — Poland, the Baltic states and Finland — to formulate joint proposals and present them to the European Commission," Epler said, adding that the bill was rejected.

According to Epler, the ETS issue is important because energy is a foundational pillar of society. The problem, he said, is that Europe lacks bold leaders willing to make major decisions in energy policy.

"If we look at the ongoing wars in Ukraine and also in Iran, they are in fact attempts to reshape global power dynamics in terms of energy. Through ETS, Europe has effectively taxed itself out of economic competitiveness, to put it simply," Epler said.

Sutt, however, said ETS has received disproportionately large attention, as there are more pressing global issues that need solving.

"From Estonia's perspective, the emissions trading system has been a very beneficial project. We have received roughly €2 billion from it, which has allowed us to purchase new buses and new trains. We have made people's homes more energy-efficient, meaning lower heating costs. Kindergartens and the Võru County Central Library have also been made more energy-efficient — something our guest Rain certainly knows well," Sutt said.

At the same time, Sutt said it would not be wise to further increase the price of emissions trading units, as a predictable and stable price is better for investment decisions.

"For example, it has been said that due to the CO2 price, the oil shale sector is struggling. In reality, the core and competitive part of the sector today is the shale oil industry, which receives free quotas. Electricity generation from oil shale is not profitable and it is certain that no rational investor will make investments to produce electricity from oil shale. Oil production will continue as long as shale oil remains competitive on the global market," Sutt said.

Epler, however, argued that ETS is partly to blame for the destruction of Estonia's oil shale industry.

"Of course, our green-left ideology-driven politicians in the Reform Party, the Social Democrats and elsewhere have also contributed to this through domestic charges. What Andres said about how beneficial ETS has been is quite astonishing. Without overpraising the Reform Party's historical views, the change is quite significant. At one time, the Reform Party's slogan was that taxes should be low so entrepreneurs and people could operate freely. Today, Andres presented talking points similar to those of Social Democratic leader Jevgeni Ossinovski: 'Look how much money we have managed to collect from people and businesses into the state coffers,'" Epler said.

Epler added that, looking at Europe as a whole, figures show that three-quarters of Europe's primary energy consumption still comes from fossil fuels and of that share, Europe itself can supply only about 10 percent. In his view, this means Europe is 85 to 90 percent dependent on imports.

"In my view, it has only been right and beneficial that Estonian people have been able to make their homes more energy-efficient and thereby reduce heating bills. We now have a cleaner living environment, which emissions reductions have helped achieve. Those who remember — or who studied or grew up in Tallinn — recall that there used to be a pulp mill on Sossi Hill and the air was not very pleasant. Today, Estonia is one of the countries with the cleanest air and that same €2 billion has gone to Estonian companies through investments and orders, including the renovation of houses and apartment buildings. So I see this very differently," Sutt said.

Epler, however, said Sutt is too focused on a banking perspective and should approach energy differently.

"I understand that kind of banker's view, but if we approached energy not from the narrow perspective of who earns or does not earn in the sector, but treated it like a basic service — like the road network, national defense, education or healthcare — something that should always be available at a very reasonable price, then companies could build industry on top of that, including today also the defense industry. People could also spend their free time or work without constantly calculating when to do dishes or laundry. I think the societal benefits would be much greater than keeping energy prices high and taking satisfaction in keeping them stable and still high," Epler said.

Many citizens, however, feel that the cost of living and ETS are part of what is driving up energy prices, with one group benefiting while another bears the cost.

"If we think, for example, about unrenovated regions — Ida-Viru County, Valga County — when will the state reach them?" the host asked.

"That is certainly a valid question. The cost of living across Europe is an issue that matters to people, including housing affordability. However, I cannot agree with the claim that better insulation and improved ventilation in buildings lead to higher costs," Sutt said, adding that the state has already renovated a small portion of the housing stock.

"This renovation work has also been carried out in southern Estonia, in larger cities, and in Ida-Viru County. It is not easy there for various reasons, including the need to convince and obtain agreement from apartment associations. To secure this funding, the ETS system has supported us very well. When we talk about energy, a competitive electricity price comes from clean energy — wind, solar, nuclear — because that is simply the objective reality. If you look at it rationally, using an Excel table, you will not arrive at the conclusion that building an oil shale power plant gives the best results. Let's look at electricity prices right now. Italy is among the most expensive — why? Because over 40 percent of its electricity production comes from gas. I do not see that we should increase our dependence on imported fuels and solar and wind are local resources," Sutt said.

Epler said that when building solar or wind capacity, one must also consider the need for additional support systems.

"You are now talking about gas, but you just said we should not increase dependence on imported fuels — there is already a contradiction. Where does that gas come from? It is inevitably imported. If we look at prices, we can see how global events are developing. But in Europe, I would say there is little indication that gas will become very cheap compared to other regions," Epler said.

Epler added that EKRE's goal would be to renovate existing oil shale power plant units or build new ones. He also said that, with modern technology, it is possible to capture all emissions produced by such plants.

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