Urmas Reinsalu: Government intransigence on energy a security risk

Government plans to make its energy policy irreversible by killing alternatives are misguided and risky, writes leader of the opposition Isamaa party Urmas Reinsalu.
Over the past few years, the government has signaled, through its political decisions, an intention to shut down oil shale energy production.
The Reform Party's government has made a binding commitment to the European Commission on this matter, while the same ideology is reflected in the energy sector development plan and the government's expectations for Eesti Energia: Reduce electricity generation, then prohibit participation in the market.
This is justified by climate policy and the resulting loss of competitiveness caused by taxation policy.
Estonia is a country in energy poverty, whose critical backbone is its own usable electricity generation as based on solid fuels. That is a reality. The government's plan is to make Estonia's energy system based on renewable electricity to the extent of domestic consumption. Natural gas-fired power plants are primarily planned as a reserve for this intermittent electricity system. The outgoing government's individual decisions in the field of energy must also be viewed within this framework, as it seeks to cement its agenda at the last minute even after the elections.
An auction for onshore wind farms in the amount of 1–2 terawatt-hours. An additional burden on consumers of up to €240 million.
Offshore wind farms have not been abandoned either. By government decree, their guarantee scheme will be opened in the fourth quarter, through which the state seeks to take on long-term obligations for the future. We do not know the terms.
Within this framework, an ideological desire to make the continued production of oil shale electricity strategically more difficult fits logically.
The fact that Eesti Energia sold the mining rights for the Uus-Kiviõli mining permit is a decision which affects energy policy in the long term, and the framework for that decision has been set by the government. It is absurd for government representatives to claim that they know nothing about it. Among those sitting on the supervisory board of Eesti Energia is Kristi Klaas, deputy secretary general for the green transition at the Ministry of Climate, who, in preparing the Climate Act, has led the closure of oil shale energy production as an end in itself.
The board also includes, as an expert, Anna Broughel, a green transition energy specialist who has likewise publicly demanded an end to oil shale energy. In other words, the energy company has been staffed with people for whom the company's sustainable operation in ensuring energy security is itself the problem. The Ministry of Finance is also represented on the board by a senior official who logically implements the owner's policy.
Viru Keemia Grupp (VKG) cannot, taken separately, be blamed in any way in this transaction. They are protecting their business interests, and shale oil has been a successful export product. They too must certainly be guaranteed a resource base.
In recent years, the government has continuously destabilized this sector and, in its vision, plans to shut it down. The state, however, has long-term energy policy interests measured in decades. At present, continued confusion prevails in this area, as the Employers' Confederation has also noted in its protest.
We have several fundamental variables.
First, let us not assume that ideology-based energy policy in Estonia will continue. In the confusion of recent years, it has demonstrated its failure. Changing this imposed framework requires drawing up a new action plan that guarantees Estonia energy security, the necessary volume of dispatchable capacity, and a competitive price. Second, the government has no concept whatsoever of Estonia's national energy interests at the European level.
The debate over European emissions trading is a substantive one; continuing in the same way is not sensible. Different countries are proposing their own solutions while at the same time changing domestic rules within the existing system. We must take this into account in our energy choices.
The government's desire to make its energy policy irreversible precisely by eliminating options in the long term is inappropriate and creates major additional risks for the future.
So what is being dealt with right now? First, taking on additional obligations in the field of intermittent electricity. Second, neutralizing oil shale energy production. In addition, sending contradictory signals to the energy sector. Among other things, a government representative announced this week that it may not even be sensible to build Estlink 3. This statement concerning energy interconnections is surprising and requires an explanation. The government's entire energy policy has been accompanied by erratic behavior that is becoming increasingly intense.
Now specifically regarding the transaction involving the surrender of the Uus-Kiviõli mining permit.
I have spoken extensively with energy experts on this issue. The prevailing understanding is that making such a decision with such long-term consequences in this form was a tactical move that fails to take a long-term strategic view.
It is perceived as the inevitable continuation of the government's policy choice, and the government bears responsibility for this decision. Claims that the government knows nothing do not hold water. If they do not know what is happening in the country, then they should resign. In reality, of course, they themselves have defined the policy expectation that Eesti Energia has now begun to enforce within the given framework.
Reference has been made to the temporary nature of the mining permit. That argument does not hold either. A minister may revoke mining permits after five years under the Subsoil Act, but is not required to do so. The minister must also give consent to the transfer of a mining permit.
The government's remaining months represent a risk in many strategic sectors. This is due precisely to the long-term destabilizing impact. On Thursday, the state budget council announced that our country's finances are unsustainable.
My message to both Eesti Energia and the officials is this: the political mandate of the Reform Party government is fading. It is in no way reasonable to make long-term decisions on the assumption that this failed policy will continue.
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Editor: Andrew Whyte, Kaupo Meiel









