Priit Tammeraid ⟩ The Baltic energy system must take four steps to avoid the worst

Over the past five years, the price of equipment needed to build energy systems has increased significantly and delivery times have multiplied. The areas and volumes of electricity use are growing rapidly, and the world is moving steadily towards increasing electricity consumption. Photo: Toomas Huik / Postimees Photo: Toomas Huik / Postimees

• Renewable energy, such as solar and wind, is inherently intermittent and unpredictable.
• Renewable energy subsidies – designed to speed up production – burden consumers with additional cost
• It is high time for the Baltics to set a clear goal that is subject to the laws of physics and the m

Sun, wind and water – these are our three friends! In recent years, renewable energy – solar and wind – has become a symbol of the universal solution to the climate crisis. But there is a dark side to this narrative, writes Priit Tammeraid, an electrician with 20 years of experience in creating electricity infrastructure.

Renewable energy production is weather-dependent and cannot be planned, which creates instability in the electricity market and makes the operation of controllable energy production systems inefficient and expensive. In addition, the construction of renewable energy production systems requires extensive oversizing in order to very occasionally obtain the necessary amount of energy – and even then it is not guaranteed.

The Baltic energy system is facing difficult choices. It is clear that renewable energy alone cannot ensure a stable supply. Building the backup systems needed to compensate for its deviations increases the complexity and costs of the system. It is time to ask – is our approach to energy security truly sustainable?

Uncontrollable energy and the price of stability

Renewable energy, such as solar and wind, is inherently intermittent and unpredictable. Because the electricity grid requires a constant balance between production and consumption, uncontrollable energy creates instability that affects the entire system.

How does this affect production? First, controllable production systems – such as gas and biomass plants – must constantly respond to fluctuations in renewable energy production, which increases their operating costs and reduces efficiency. Nuclear plants, although flexible to a certain extent, are optimized to provide stable baseload power and are not suitable for rapid capacity adjustment. Thus, fluctuations in renewable energy can also reduce the efficiency of nuclear plants.

Market price fluctuations caused by renewable energy production – negative prices during peak production and high prices during production shortages – make energy prices unstable and difficult to plan.

Second, during peak renewable energy production times, when demand is low, controllable generation systems remain underutilized. Maintenance and capital costs do not decrease, but the low utilization of plants ultimately increases the unit price of energy.

How does this affect consumers? Consumers have to endure not only high electricity prices, but also the unpredictability of market prices. Market price fluctuations caused by renewable energy production – negative prices during peak production and high prices during production shortages – make energy prices unstable and difficult to plan. This is particularly painful for industry, the competitiveness of which depends on stable production costs.

Subsidies: Renewable energy’s "bread eating permit" system

Renewable energy subsidies, designed to speed up production, often create a system that burdens consumers with additional costs. One can bring as comparison the “bread eating permit” system: before a person can buy bread, they must pay for an eating permit, rent a licensed knife to cut the bread, and pay separately for the time spent cutting it. After all these additional costs, the bread is nevertheless available at a market price that does not reflect the real value, but rather includes the absurd additional costs of the system.

The Baltic energy system needs serious reform. For a sustainable and stable system, we need:

A central stable nuclear energy solution that ensures baseload needs and reduces dependence on controllable backup systems.

Efficient storage capacity with pumped hydropower plants, which balances out uncontrollable consumption fluctuations against baseload energy production.

Fast-responding battery storage systems that ensure frequency accuracy and grid stability.

The sensible integration of renewable energy that complements the system, rather than dominating it.

High time to act

Over the past five years, the price of equipment needed to build energy systems has increased significantly and delivery times have multiplied. The areas and volumes of electricity use are growing rapidly, and the world is moving steadily towards increasing electricity consumption. It is high time for the Baltics to set a clear goal that is subject to the laws of physics and the market economy and take decisive steps to move towards it.

Energy is the backbone of civilization. We do not have the luxury of relying on short-sighted solutions – the future depends on a thoughtful, long-term strategy that takes into account both physics and economic reality.