Renewable energy producer 4Energia plans a 500MW offshore wind farm with a hydro storage power plant in a granite mine in Muuga Harbour, at the Port of Tallinn. The project’s estimated cost is €2 billion, with an additional €320 million required for the hydro storage. Part of this could be recouped through the sale of granite for road building.
The Hiiumaa project suffered a potential setback late last year, when €150 million in state funding was awarded to state-owned utility Eesti Energia to build an oil shale power plant in Auvere. The Estonian government may ask EU permission to further fund Auvere through carbon credits – an allowance that is meant to support environment-friendly investment. This might eliminate a potential source of funding for Hiiumaa.
But 4Energia CEO Martin Kruus believes that gas and wind generation are more rational for the region’s future than either oil shale or nuclear production. The likely demise of two planned nuclear power plants — Visaginas in Lithuania and Pyhäjoki in Finland — could create sufficient demand for offshore wind electricity from Hiiumaa, he said.
Estlink 1 already provides 350MW of cross-border interconnection capacity between Estonia and the Nord Pool market. Finland has been importing power from Estonia during cold spells. Sales southwards to Latvia and Lithuania should be strong for years to come, Kruus said. "Most of Lithuania’s electricity is imported, either directly or indirectly through gas, so there is a clear business case for competition from offshore wind energy," he added.
The cable-laying vessel Nexans Skagerrak is currently working on Estlink 2, a 650MW connection between Finland and Estonia due to come online this year. Estonia’s national electricity development strategy calls for up to 1,800MW of balancing capacity by 2018, allowing 900MW for wind, 300MW for peak-load reserve and 600MW for emergency reserve.
The Muuga Harbour hydro storage plant is still seeking a construction permit, but Lembit Vali, CEO of Energiasalv, 4Energia’s partner in the project, sees no environmental objections to pumping Baltic sea water up and down through isolated shafts to the underground chamber. "As there are no contaminants in the granite, no pollutants will be introduced to the sea," said Vali. The underground reservoir in Muuga is competing with two US projects to be the first of its kind.
The Hiiumaa project is behind its original schedule and 4Energia is now hoping it will become operational in 2020.