Low carbon energy transition in Estonia

The report analyzes Estonia's energy transition from a system heavily dependent on oil shale to one based on low-carbon sources by 2050. Using LEAP, Balmorel, and EMPS models, it evaluates four scenarios: Baseline (BAU), Carbon Neutral (CN), 100% renewable (RES), and 100% renewable with increased demand (RES+). Key findings highlight that while wind and biomass have significant potential, achieving a carbon-neutral sector requires phasing out oil shale by 2040, expanding interconnections with the Nordic Power System (specifically Sweden and Finland), and implementing policy reforms such as removing fossil fuel subsidies and increasing investment support for small-scale renewables and energy efficiency.

• Estonia's energy sector is dominated by oil shale, which accounted for 87.2% of final energy consumption in 2014.
• The report identifies a significant potential for renewable energy, with theoretical availability reaching 607 PJ and a maximum applicable potential of 263 PJ.
• Under the RES+ scenario, the highest generating capacities for wind and wood are achieved, though some shale oil generation remains due to long investment payback periods.
• Oil shale-based electricity generation is projected to be phased out starting in 2040, with wood and wind replacing the demand.
• Electrification of transport and heating via electric vehicles and heat pumps could increase electricity consumption by 2,100 GWh, while reducing CO2 emissions by 910,000 tons.
• The current transmission grid is underdeveloped in areas with the highest wind resource potential, specifically the west coast, islands, and the EEZ marine area.
• Integration with the Nordic Power System through new interconnections with Sweden and Finland is critical for balancing wind power fluctuations using Norwegian and Swedish hydropower.
• The LowCO2withRUSBEL scenario allows Estonia to produce 10,525 TWh of renewable electricity by 2050, with 7,250 TWh coming primarily from offshore wind.
• To achieve a low-carbon transition, the government is recommended to phase out oil shale subsidies, including carbon tax exemptions for large producers and excise tax exemptions for agriculture and fisheries.

APA

Kuhi-Thalfeldt, R., & Lahtvee, V. (2016). Low carbon energy transition in Estonia. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2017/12/norstrat-report.pdf

Chicago

Kuhi-Thalfeldt, Reeli, and Valdur Lahtvee. Low carbon energy transition in Estonia. Stockholm Environment Institute, 2016. https://www.sei.org/wp-content/uploads/2017/12/norstrat-report.pdf.

Wikipedia

{{cite report |last1=Kuhi-Thalfeldt |first1=Reeli |last2=Lahtvee |first2=Valdur |title=Low carbon energy transition in Estonia |publisher=Stockholm Environment Institute |date=March 2016 |url=https://www.sei.org/wp-content/uploads/2017/12/norstrat-report.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{kuhithalfeldt2016low, author = {Kuhi-Thalfeldt, Reeli and Lahtvee, Valdur}, title = {{Low carbon energy transition in Estonia}}, institution = {Stockholm Environment Institute}, year = {2016}, month = mar, url = {https://www.sei.org/wp-content/uploads/2017/12/norstrat-report.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }