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The Estonian National Audit Office finds that as things stand, it is rather doubtful that Estonia will reach the goal that at least as much electricity as the total electricity consumed in Estonia in a year will be produced from renewable sources in Estonia by 2030.
Although the Ministry of Climate and the Ministry of Regional Affairs and Agriculture have accelerated the process of setting up wind farms to some extent, these measures will not significantly speed up the planning and environmental impact assessment procedures that have already started and will have the greatest impact on the goal set for 2030.
The Ministry of Climate must find and implement workable measures to ensure that new wind farm plans and environmental impact assessments are processed quickly and without excessive administrative burden, and to minimize the risk of litigation.
In 2022, the Riigikogu adopted an amendment to the Energy Sector Organization Act, which sets a target according to which the volume of renewable energy produced by 2030 should comprise at least 100 percent of the total final electricity consumption. In 2022, renewable electricity accounted for 32 percent of the electricity consumed in Estonia, which means that less than a third of the national renewable energy target has been met.
No major wind farms have been added in Estonia in the last decade to use wind energy, which is considered to have the highest potential as a source of renewable energy in the region. Only in the last few years, steps have been taken to remove obstacles and simplify processes to speed up the construction of wind farms.
The audit report of the National Audit Office highlights a number of problems and risks that continue to hold back the development of onshore wind farms and make the achievement of the renewable electricity target doubtful -- for example, the length of planning and environmental impact assessment proceedings and problems with connection to the grid. The Ministry of Climate, unlike the National Audit Office, considers the target achievable and is optimistic.
Auditor General Janar Holm said about the situation: "It's extremely important to look at wind energy not as a thing or an end in itself, but in the context of Estonia’s electricity production and consumption as a whole."
«The objective of creating more renewable energy capacity may seem unreasonable when considered in isolation, out of context and in a narrow sense, unless parallel efforts are made to develop storage capacity, increase the capacity of the power grid and create export incentives, because if the national target were met, or even if it were close to being met, Estonia would have several times more renewable energy generation capacity than the projected peak demand. Also, the place nuclear energy will have in Estonia’s energy portfolio in the future should be carefully analyzed and decided in the near future when setting and implementing renewable energy targets,» he said.
In the case of international connections, it must be taken into account that electricity does not only move out of Estonia, but also into Estonia in an open electricity market -- when the wind is blowing in Estonia, it is very likely that the wind is also blowing in the neighboring countries and that they also produce more wind energy at exactly the same time. This means that the creation of international connections will provide an opportunity to export surplus electricity, but at the same time, their construction will also increase the supply of wind energy in Estonia during windy periods.
In the process of establishing international connections with neighboring countries, the actual possibility of exporting electricity will also depend on whether our neighboring countries themselves establish further connections with other countries.
If no storage solutions are found and the issues concerning international connections are not solved, Estonia will have several times more potential capacity than consumption during some hours, and electricity production in some wind turbines will therefore have to be stopped. And if the capacities are not employed, but the fixed costs of the investment are allocated to the amount of electricity produced, this means that electricity consumers pay for this unused capacity in one way or another.
«We will also pay when the price guarantees given to producers as encouragement for the implementation of renewable energy projects prove to be too generous and considerably exceed the future market price. Thus -- more capacity to generate electricity does not automatically mean cheaper electricity. Consumers will get reasonably priced electricity if the best possible balance between supply and demand is achieved,» Holm said.
«In particular, I would like to emphasize what I pointed out in my 2023 annual report to the Riigikogu -- if the planned amount of renewable energy were added after 2030, Estonia would have sufficient electricity generation capacity, but it would lack dispatchable production capacity. However, dispatchable generation capacity is needed, among other things, to ensure the frequency of electricity in the grid. The choices and decisions necessary to ensure dispatchable capacity must be made as soon as possible,» he added.
All this means that in the coming years, major developments in energy will have to be tackled in parallel across the whole diversity of the energy system in terms of various sources, networks, interconnections and storage, Holm noted.
Ministries have taken steps to make the planning processes for wind farms more efficient and speed up the environmental impact assessment (EIA) process, but the impact of the changes on the target set for 2030 is smaller than necessary.
Although changes were made in 2023 to speed up the main procedural instrument for planning wind farms -- the designated spatial planning procedure of local authorities -- (for example, the requirement to prepare a detailed solution in the plan was eliminated, the number of times proposals can be requested in the procedure was reduced), these changes do not make it possible to speed up most of the designated spatial plans for wind energy that have progressed further in the procedure.
Most designated spatial plans are already at a stage where the use of new possibilities would mean that certain procedural steps would have to be repeated, which would in turn mean slowing down these proceedings. Also, the time saved by dispensing with the preparation of a detailed solution stage is still not clear, as according to the experts, it is uncertain whether it can be implemented in practice.
Ministries have also taken measures to speed up the environmental impact assessment of wind farms. An exception of shorter environmental impact assessment has been created for onshore wind farms (but no environmental impact assessments have been carried out according to this so far) and the requirements for the experts and leading experts in environmental impact assessment have been lowered, which should solve the shortage of experts with assessment licenses.
The proceedings concerning the program for strategic environmental impact assessment of the designated spatial plans of local authorities have also been shortened. The time saved as a result of the changes, which concern the program for strategic environmental impact assessment of the designated spatial plans of local authorities, is only one to two months.
Environmental impact assessment is usually the most time-consuming stage in the development of wind farms, which can be accelerated without compromising the quality of the assessment. However, there is no agreement among public authorities on what are the acceptable environmental impacts of wind farms and what are the significant impacts. As a result, the environmental impact assessment proceedings of wind farms take way too long or wind farm developments and studies in areas with favorable wind conditions are not initiated.
The lack of data on the state of the environment remains a problem, which means an additional unnecessary waste of time and money. As there is generally no high quality and up-to-date information on the environmental conditions of wind farm planning areas, extensive studies (e.g. on birds, bats, vegetation, marine life) have become part of every impact assessment.
There is also no overview of studies related to wind farms and data collected within the scope of monitoring, which makes it impossible to shorten the environmental impact assessment procedures to a greater extent. Creating an overview of studies would give impact assessment experts the opportunity to reduce the volume of new studies and to harmonize assessment methodologies.
The positions of the Ministry of Economic Affairs and Communications on how to support the development of wind energy and meet renewable electricity targets have been contradictory.
Over a short period of time, the ministry has taken the view that onshore wind farms have a low probability of success and are insufficient to meet the renewable electricity targets set for 2030, but has also found that Estonia’s renewable electricity needs can only be met by onshore wind farms, which longer need support. However, a reverse auction for onshore wind and hybrid farms, which gives price guarantees to producers, was carried out in 2023.
The Ministry of Climate has told the National Audit Office that in order to meet the renewable energy target, the possibilities to generate wind energy onshore should be used first, and offshore wind farms are essential to meet the increasing electricity demand after 2030.
In the opinion of the National Audit Office, there are plans to grant the support allocated for acceleration of renewable energy development from the European Union’s Recovery and Resilience Plan REPowerEU not only to necessary activities, but also to activities that are not essential for the promotion of renewable energy.
For example, there are plans to allocate money for the purchase of equipment that is only indirectly connected to the acceleration of renewable energy (spatial data collection equipment, which is not needed for building wind farms). It is planned to support the creation of jobs related to land operations and to compensate for the costs of deforestation, but the jobs for which money is being requested will only become necessary after planning approval, that is from 2026 to 2027.
However, the REPowerEU funds, totaling 32 million euros, can only be used until the first quarter of 2026, while the activities needed to achieve the targets will need to be carried out at least until 2030 and beyond. Whilst some of the activities outlined by the Ministry have a long-term impact on accelerating renewable energy projects, these effects may not be felt before 2030.
The National Audit Office recommends that the Ministry of Regional Affairs and Agriculture, in cooperation with the parties involved, resolve the practical issues in the planning and environmental impact assessment procedures that cause confusion, waste the time of local authorities and slow down the proceedings.
In order to make the environmental impact assessment of wind farms more efficient and faster and to enable the identification of suitable areas for wind farms, the National Audit Office recommends that the Ministry of Climate, in cooperation with the Environmental Board, impact assessment experts and experts in various fields, agree on the limits of acceptable negative environmental impacts and the most important impacts to be assessed, as well as the assessment methodologies. Also, the information on studies carried out and data on environmental monitoring and follow-up must be brought together to the same place to speed up environmental assessment proceedings.
Estonia’s success in meeting the renewable energy target will depend on how the measures that have been initiated are implemented and what additional measures the Ministry of Climate implements in the coming years. Not all of the measures planned so far have been launched.
A total of 31 local authorities in Estonia are planning wind farms. For this purpose, there are 20 general plans designating wind development areas and 23 designated spatial plans of local authorities. In the case of designated spatial plans, one plan was initiated in 2019, five plans in 2020, four plans in 2021, six plans in 2022 and seven plans in 2023.
Height restrictions on wind turbines to protect the operation of national defense structures (radars) had been established on approximately 70 percent of the territory of Estonia by the end of 2023, as wind turbines interfere with the detection of objects radars and radio reconnaissance activities. The height limits will disappear from 2024–2027.