The Programme for Liberalisation of the Gas Market in Estonia will be ready in October

In accordance with the instructions of the government concerning the gas industry, Elering ordered an analysis of the arguments for and against the liberalisation of the gas market from Pöyry Management Consulting (UK) Ltd, and of the next steps required for the liberalisation programme.

The aim of the gas market liberalisation programme, which will be ready by the end of October, is to present options and models for the development of the Estonian gas market in the light of possible developments in the global gas market, for the unbundling of gas transmission from production and sales operations, and for investment in the infrastructure needed for the gas industry. It will also analyse the effects of different tariff models.

Chair of the Elering board Taavi Veskimägi said that the development of the gas market should ensure sufficient energy security for gas through the diversity of supply chains and increased numbers of suppliers. “A well-developed gas market will allow us to use more gas than ever before as a low CO2 fossil fuel that can deliver the energy needed for our economic development. Given the major changes taking place globally in the gas industry through increased use of liquefied gas and shale gas, it is worth looking carefully into the prospects for gas as a bridge fuel in the move from fossil fuels to greater use of renewable sources of energy,” said Veskimägi. “Drawing up the programme will give us a clear platform for further action towards final full liberalisation and further development of the market and for investment in gas infrastructure.”

Estonia has been granted an exemption from implementing the articles of the natural gas directive on unbundling of ownership, of which the most important exemption is from the sections concerning the unbundling of the ownership of natural gas networks from that of supply and production. However, this exemption is not binding in its nature and it is possible to use domestic law to set standards that are equivalent to those in the directive if they are appropriate for the energy security of Estonia. Changes in the global gas industry have led to a debate in Estonia as well and the aim of the research that is being started is to provide more information for decision makers.

Last November the government charged Elering with developing a department in the company that specialises in gas. Elering, The Ministry of Economic Affairs and Communications and Pöyry are working together to draw up the liberalisation plan for the Estonian gas market by the end of October this year. The project will take in consultations with other ministries and other state agencies and various market participants, including Eesti Gaas.