SAO blasts shale

  • 2012-10-03
  • From wire reports

TALLINN - An analysis of the Estonian State Audit Office (SAO) states that Estonia’s energy policy is outdated, oil shale-based electricity is unjustifiably preferred, companies pay too low pollution taxes in mining oil shale and the resource tax of oil shale is one-fourth what it should be, reports Postimees.

Estonian state-owned energy company Eesti Energia manager Sandor Liive said that the SAO conclusions are based on misleading data and he recommended that the analysis not be published in its current form. Economy Minister Juhan Parts thinks that the conclusions of the analysis are not in line with its aim - to facilitate finding an electricity production portfolio that would be most favorable for consumers in the long-term perceptive.
The SAO audit is based on the assumption that the EU will continue tough climate policies, which will make CO2 quotas more expensive, and by 2050 will result in CO2 emissions being banned in the EU. Thus the analysis recommends the state to focus on renewable energy.

The SAO auditors also said that the government’s energy policy is outdated and doesn’t take into consideration the electricity market opening up for competition – while so far the energy industry has been based on the assumption that there must be enough power stations in Estonia to cover the country’s own consumption, with the open electricity market that might not be a practical solution.

After the second electricity sea cable to Finland is completed in 2014, Estonia will be well connected to neighboring states and can import electricity required for energy security. The government has, however, decided to build a new oil shale electricity station and supports current stations. But both the cables and the electricity stations will be paid for by the taxpayer and, thus, by pursuing two directions at the same time, burdensome expenses have been made, the SAO said.

The SAO has been very critical of plans by the Economy Ministry and the Eesti Energia board before, and its evaluation was one of the factors why the government decided not to list Eesti Energia on the bourse.