Swiss-Swedish concern wins Estlink tender

  • 2005-02-09
  • From wire reports
TALLINN - The Swiss-Swedish engineering giant ABB has won the international tender for the Estlink underwater power-cable project that will connect Estonia's and Finland's energy systems.

Eesti Energia officials, who conducted the tender, announced the decision on Feb. 7, describing the competition as tough. In the end, they said, it came down to price. "The two bidders who qualified in the tender, ABB and the French concern Areva, were both technically very strong. To sum it up, the price of the offer was the deciding factor," Marko Allikson, an Eesti Energia board member, said.

The project's total cost, including cable layout and substation connection, comes to almost 110 million euros. The direct-current cable will link a 330 kV substation at Harku, outside Tallinn, to a 400 kV substation in Espoo on the southern coast of Finland. The line will have a total length of around 100 kilometers, of which 70 kilometers will be under water. Twenty kilometers will run across Finnish soil and nine kilometers across Estonia.

Project completion is scheduled for 2006.

Estonia is expected to have a surplus output capacity until 2012, and the underwater cable will give it exposure to the lucrative Finnish market. It is estimated that the country will sell approximately two TWhs of power to Nordic countries annually through the sea cable.

Last year the Estonian Energy Market Inspectorate ruled that the price of electricity sent via Estlink would have to be determined by the market and not by consensus among the owners of AS Nordic Energy Link, the company established by Eesti Energia to carry out the project.

Estlink, which unites Latvia's Latvenergo, Lietuvos Energija of Lithuania, and Finland's Helsingin Energia and Pohjolan Voima as partners, is also part of the Baltics' wider push to decrease dependence on energy from Russia and Lithuania's nuclear power plant and to increase interdependence with EU members states such as Finland and Poland.

Last month the Lithuanian media reported that a feasibility study for a power link between Lithuania and Sweden was due to be completed in February. The cable would be an alternative to the Lithuanian-Polish electricity bridge project, which is proceeding slower than officials in Vilnius had hoped.

The SwindLit power link would enable Lithuania to trade with both Scandinavia and Poland. According to preliminary estimates, the construction of a 700 megawatt cable with an annual capacity of 2 billion 's 3 billion kWh on the Baltic seabed would cost some 300 million 's 400 million euros.

Fearful of cheaper electricity from Lithuania, Warsaw has been dragging its feet with an application for cofunding to the European Union, which already has pledged support for the project and has entered it into the list of priority programs, Lithuanian officials said.