Energy Market Actors

Electricity market

Structure of power sector

The distribution network is mainly private. There are about 40 distribution companies. The most important one is OU Jaotusvörk, a subsidiary of Eesti Energia which has a market share of 88% (5,922 GWh sold in 2008). The two other important electricity distributors are VKG Elektrivorgud and Fortum Elektra, which hold approximately 4% and 3% of the market shares.

Eesti Energia is a state owned public limited company engaged in power production, transmission, distribution and sales as well as other power-related services. Since 1999, Eesti Energia AS has unbundled the accounts and management of different business units. Eesti Energia was turned into a public holding company held by the state. The estonian grid operator is Elering, a former subsidiary of Eesti Energia. In compliance with EU unbundling requirements, Elering was sold to the Estonian Government in January 2010, for approximately €134m.

[Enerdata, Eurelectric, Elering]

Status of deregulation

In 2007, 15 % of the electricity market was opened. Estonia is the only EU Member State that was granted a transition period for the liberalisation of its electricity market by 2013, due to the investments Estonia needs to make in its electricity production, which relies heavily on oil shale. Since it is a partially closed electricity market, the state has set very clear operating restrictions for the oil shale power stations that belong to Eesti Energia.

The second special feature of the Estonian electricity system is that Estonia is not only highly dependent on oil shale, but it is also directly linked to a non-EU electricity system. Technically, Estonia could import almost all the electricity that it needs. This puts Estonia in a very different position from other EU Member States, since competition on the Estonian electricity market could come not only from within the EU, but also from non-EU countries whose electricity markets operate with entirely different rules and that can sometimes also be politically manipulated.

[Ministry of Economy]

Access to the network

Regulated Third Party access – access is restricted as large users require an import license for power purchases from abroad.

Regulator

The Estonian Energy Market Inspectorate (EMI) was established pursuant to the Energy Act on 22 January 1998. EMI is responsible for implementing the state control, supervision and monitoring of the fuel and energy market, including the issuance of market licences and price control.
References

Oil and gas market

Oil, Gas and Oil Shale

Oil

Four main operators are involved in the supply, trading and logistics of oil: Alexla AS, EOS Vopak, Scantrans (Ireland) and Eurodek (Denmark).

Eesti Statoil is the country's main distributor with one-third of the market. Neste Oil (Finland) is the sector's second largest player.

[Enerdata]

Gas

The national Gas Company is Eesti Gaas. It is fully privatized, the group's shareholders are Gazprom (37.02 %), Ruhrgaz (33.66 %), Fortum Oil and Gas OY (17.72 %), Itera Latvija (9.85 %) and various carriers (1.75 %). It is responsible for supply and distribution.

Estonian gas, imported from Russia, is distributed through a network of pipelines that has a total length of more than 2,000 kilometers. The share of natural gas is relatively modest at around 15%.

Oil Shale

Estonia is the only country in Europe which has a significant oil shale mining industry. The oil shale power plants produce approximately 90% of Estonian electricity, making oil shale energy production a strategic industry in Estonia.

Eesti Kaevandused is the main oil shale producer and produced approximately 14 Mt in 2008 and will apply for mining rights for 18 Mt/year as of 2016. The company has four mines, two underground and two opencast, and a rail transport unit.

All shares are owned by the Republic of Estonia and the company is registered on the London Stock Exchange. The company works in Estonia, Latvia, Lithuania and Finland, and also in regions further away, such as Jordan.

[Eesti Kaevandused]