Elering and Enefit Power Sign Agreement to Ensure Island Operation Capability

Today, 1 December, Elering and Enefit Power, a subsidiary of Eesti Energia, signed an agreement to ensure island operation capability following a public procurement process. Under the agreement, Enefit Power guarantees the controllable generation capacity required to maintain Estonia’s security of supply. Maintaining the necessary 1,036 megawatts of generation capacity will cost up to €59.5 million per year.

“Thanks to this procurement, we have secured the necessary amount of power plants for emergency situations—particularly in the event that Estonia loses its electricity connections with neighbouring countries, including the Continental European synchronous area. If this happens during a windless and sustained cold weather, we will have enough controllable and dispatchable power plants in Estonia to get through such a challenging period,” said Kalle Kilk, Chairman of the Management Board of Elering.

“The situation in frequency markets and the electricity market clearly shows that Estonia needs controllable generation capacity. Enefit Power’s controllable power plants account for 85% of Estonia’s dispatchable generation. The island operation mechanism helps ensure that these plants remain operational even when they cannot access the market. At the same time, it allows their output to continue being offered to the market, which helps prevent extreme electricity price spikes and reduces the cost of ensuring security of supply,” said Raine Pajo, Chairman of the Management Board of Enefit Power.

“To guarantee security of supply, we need our older power units until modern controllable capacity solutions are built in Estonia,” Pajo added.

The cost of ensuring island operation capability is based on actual expenses. This means that Elering will only reimburse Enefit Power for costs directly related to providing the service. The winner’s activities will be monitored by an independent auditor according to a dedicated methodology.

Under the Electricity Market Act, the cost of this service will be borne by electricity consumers. Starting January 2026, a new line item called “security of supply fee” will appear on network service invoices. In 2026, the fee will be €7.58 per megawatt-hour, or €0.00758 per kilowatt-hour excluding VAT. For an average household consuming 250 kilowatt-hours per month, the impact of the security of supply fee will be approximately €2.35 per month including VAT.

Enefit Power retains the right to participate in other energy markets with the same capacities. If the company earns more revenue from energy markets than anticipated in the agreement, the amount payable for the island operation service will be reduced accordingly—thus lowering the cost of ensuring security of supply for Estonian electricity consumers.

Enefit Power operates the Eesti Power Plant, the Balti Power Plant, and the Auvere Power Plant.