Environmental groups have criticized an energy agreement between Estonia and the European Union, saying the country should consider alternative sources of energy rather than relying on oil shale fuel as it does now.
The closure of the energy chapter in Estonia's accession negotiations with the EU on July 30 allows Estonia to continue producing expensive and polluting oil shale based fuel, and allows the country's energy market to remain partly closed to foreign competitors until 2012.
The "concessions" enable Estonia to preserve its competitiveness, independence from foreign energy producers and stable prices, said Alar Streimann, deputy under secretary at the Foreign Ministry, who led the delegation.
"If we didn't have a major producer (the oil shale power stations), it could happen that suddenly we don't have any electricity at all," Streimann said.
"This also guarantees stable prices. Our main aim is to prevent imports of electricity - for which there may be doubts about continuity - and possibly at dumping prices."
The EU agreed to fund oil shale research in northeastern Estonia, where thousands of people are engaged in the sector. Estonia, in turn, promised to restructure the sector by 2012 and provide the oil shale industry with the best possible equipment to preserve the environment.
But the Estonian Fund for Nature and the Estonian Wind Power Association criticized the agreement, saying Estonia should invest in the production of alternative green energy.
"We weren't happy about the closing of the chapter," said Jaan Tepp, chairman of the board at the Estonian Wind Power Association.
"It should have been done only after it had been made clear what the state's role in supporting the production of renewable energy was."
Urmo Lehtveer, spokesman for the Estonian Fund for Nature, agreed.
"From one side, it is inevitable that Estonia depends on oil shale energy and can't make fast changes. It would have become expensive if it had agreed on shorter terms. On the other hand, the Estonian government is passive toward environmental matters and does nothing to develop alternative sources," said Lehtveer.
The Estonian Green Movement has started a court case against the Economic Affairs Ministry alleging that the government had not estimated the impact of oil shale based energy production on the environment before starting the development project.
"The emphases are wrong here. We should give up the use of oil shale one day and the sooner we start preparations, the better," said Lehtveer.
According to some estimates Estonia's oil shale mines will be exhausted in 30 years.
Eesti Energia's promotion of the use of electrical energy for heating houses is contrary to the policies of more environmentally enlightened governments, said Lehtveer.
Government policies also attract foreign investors in spheres such as cellulose production and metallurgical engineering which make intensive use of electricity, he added.
Under the agreement Estonia needs only to open 35 percent of its energy market to foreign investors by 2009 and can wait to open the rest of the market until 2012. Currently the state owned energy company Eesti Energia controls 90 percent of the market while wind and water power from Latvia and Russia account for the remaining 10 percent.
Estonia has provisionally closed 28 of the 31 chapters in the accession negotiation process. Still open are chapters on agriculture and financial and budgetary provisions, after which a catch-all chapter to tie up loose ends will be discussed.