Fee for new wind turbines to enter into force on July 1

TALLINN – On July 1, a wind turbine fee will enter into force, which will bring additional income to people and communities living near new wind turbines, while onshore wind turbines will bring an annual income of up to six minimum wages to people living in the affected area, according to the Estonian Ministry of Economic Affairs and Communications.

The fee will not be extended to wind farms that are already in use, the ministry said.

Climate Minister Kristen Michal said that renewable energy solutions are more affordable than fossil ones, and this is good for people's livelihoods.

"Clean energy production also increases the competitiveness of business and is positive for the climate," the minister added.

Compensation will be paid from wind turbine fees. The Environmental Board will start collecting fees from wind turbines with a height of more than 30 meters, which receive a license after July 1 of this year.

Fees collected from onshore wind farms are distributed as compensation to local governments and households located near the wind turbines. Households located up to two kilometers away from wind turbines up to 250 meters high and households located up to three kilometers away from wind turbines over 250 meters high can receive compensation.

When a wind turbine starts working, the amount of the fee depends on the electricity exchange price of the previous quarter and the amount of electricity produced by the wind turbine. During the construction phase, a tenth of the current wind turbine fee is paid for the turbines.

For example, if a municipality has a wind farm with a capacity of 100 megawatts, which produces 300,000 megawatt-hours of electricity, and the average quarterly electricity price during production was, for example, 90 euros per megawatt-hour, then the fee will be between 189,000 and 270,000 euros. Natural persons are paid a fee from wind turbines on land in the maximum extent of six months' minimum wage.

The fee for offshore wind farms goes to local governments located within a radius of up to 20 kilometers from the wind farm. If offshore wind turbines affect the operations of a fishing company, they can also apply for compensation through the Environmental Investment Center.

Erik Kosenkranius, deputy director general of the Environmental Board, said that the authority's information systems are ready for the implementation of wind turbine fees.

"The purpose of environmental fees is to reduce the harmful effects associated with the use of natural resources and to create a supportive economic environment for more environmentally friendly technologies and business models. The Environmental Board welcomes any initiative that helps society adopt more environmentally friendly solutions," Kosenkranius said.

So far, environmental fees have been levied on, for example, mining, water abstraction, emission of pollutants into the air, and disposal of waste into the environment. Environmental fees are managed by the Environmental Board together with the Tax and Customs Board, the correctness of calculating and paying environmental fees is checked by the Environmental Board.

In 2022, a record 149.4 million euros of environmental fees were declared, which are distributed between the state budget and the budgets of the local governments of the location of environmental use and are used to maintain the state of the environment, reproduce natural resources and repair environmental damage.