Additional power plants will increase the renewable energy charge to 1.04 cents per kilowatt-hour

The renewable energy charge collected to finance renewable energy subsidies will be 1.04 cents per kilowatt-hour in 2017, compared to 0.96 cents in 2016.

In the last five years, the renewable energy charge has ranged from 0.77 to 0.97 cents per kilowatt-hour, though the charge decreased in 2013 and 2014.

According to the prognosis, the amount of subsidised renewable energy will increase by 13 per cent next year, reaching 1429 gigawatt-hours. In addition, there will be 182 gigawatt-hours of energy produced as combined heat and power.

According to Taavi Veskimägi, Chairman of the Board of Elering, which collects the renewable energy charge and arranges subsidy payments, an increase in renewable energy costs in society makes perfect sense, given the ever higher objectives in using renewable energy. “The renewable energy share estimated for 2017 is already over 18 per cent, which is more than the target level of 17.6 percent electricity consumption set for the year 2020. The desired objective to increase the share of renewable energy to 50 per cent of expected consumption by the year 2030 requires a more than threefold increase in renewable energy production in comparison with the 1.4 terawatt-hours in 2017,” stated Veskimägi.

Next year, the renewable energy capacity will mostly increase due to two new power plants – the Imavere combined heat and power plant and a new power plant in Väo. 42 per cent of renewable energy subsidies are used to subsidise wind energy, while 47 per cent goes to large biomass-consuming power stations, nine per cent to other biomass and biogas stations, two per cent to hydro power plants and 0.3 per cent to solar energy plants.

Next year, the financial volume of renewable energy subsidies is estimated to be 76.7 million euros and that of electricity produced as combined heat and power will be 5.8 million euros. The over-performance of the previous period allows the amount collected as renewable energy charge to decrease by 3.5 million euros next year.

Elering has been given the obligation to administrate renewable energy subsidies by the Electricity Market Act. Elering operates as a payment agency by paying out subsidies to renewable energy producers in accordance to the subsidy levels and conditions enacted by law. To finance subsidies, electricity distribution networks forward a renewable energy charge collected from final electricity consumers to Elering, the tariff of which will be confirmed by 1st December of the previous year by Elering.