Production of renewable energy increased three times

According to Statistics Estonia, the production of electricity from renewable sources increased nearly three times compared to the previous year.

The growth of electricity production of renewable sources was mainly influenced by the new combined heat and power plants which consumed wood fuel. If until 2007 the share of renewable energy remained around 1%, then in 2008 it was 2.1% and in 2009 6.1%. Although the proportion of wind and hydroenergy is still relatively small in gross electricity generation (less than 3% of electricity output), a significant development took place in this sphere in 2009. Due to the new installed wind turbines, the wind energy production increased by about a half (47%) compared to the earlier year, the production of hydroelectricity increased over 14%.

In 2009, the production of electricity totalled 8,779 gigawatt-hours — nearly 17% less than in 2008. The decline in electricity production is caused by the decreasing demand of local business sector and considerable increase in electricity imports compared to the exports. Imports increased over two times compared to 2008. At the same time combined heat and power (CHP) generation increased due to the application of new combined plants consuming local fuel. The share of CHP in total electricity generation increased from 8.6% in 2008 to 9.2% in 2009. The share of CHP in total heat generation increased from 27% in 2008 to 35% in 2009.

In 2009 compared to the previous year, the production of oil shale declined by about 8% due to the decreased needs of power stations. At the same time, due to stable external demand and good weather conditions, the production of other domestic fuels increased. The production of wood fuels and peat increased. The production of wood pellets was 45% larger than in 2008. 95% of this production was exported, of which 70% to Denmark.

During the last ten years, shale oil has become an important export commodity in the energy market. In 2009 compared to 2008, shale oil production increased by about 10% and exports of shale oil increased by more than a third (35%). More than half of the shale oil production was exported — mainly to Sweden, Denmark, Netherlands and Belgium.

In 2009 compared to 2008, the total imports of energy products decreased 5%. Imports of natural gas decreased the most (over 30%). This was caused by the chemical industry’s decreasing demand for natural gas used as a raw material. In 2009, imports of liquid fuels decreased due to the decrease in the demand which arose from the decline in the business sector and decreasing purchasing power of the population. In addition, the new excise duty rates established for liquid fuels in the middle of the year had an effect on the decreasing volumes of imported liquid fuels. At the same time imports of electricity from Lithuania was about two times larger compared to 2008.

Production of electricity from renewable sources, 2002–2009

Diagram: Production of electricity from renewable sources, 2002–2009

Source: Statistics Estonia

Government to freeze civil service wages in 2011

Estonian finance minister Jürgen Ligi said this week that the government will freeze civil service wages for 2011. “We have frozen public spending and will not increase the number of civil servants nor their wages,” Ligi said in an interview to ETV evening news.

Ligi emphasised that the fundamental public needs will be covered. “Social expenditures are secure and we are working right now for increasing investments,” he said, adding that pensioners should not be afraid that pensions will be cut next year.

Opposition leader Kadri Simson, chairman of the Centre Party faction, said that the plan to cover the budget deficit with a loan is better than increasing taxes and cutting social spending.

Ligi admitted that the fact that there will be two elections in 2011 was affecting the budgeting process, but said that its impact remained smaller than feared. At present the spending requests of ministries are still about 2 billion kroons higher than what the state is prepared to spend.

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