1. Energy Sector in Estonia Ando Leppiman Energy Department, Head of fuel and energy market division

2. Topics Estonian Energy Market Overview Trends in Estonian energy market and Estonian Energy Market in the EU and world context

3. Estonia: Key Fact Sheet 2005 GDP (in current prices)10,5 Bill. EUR Annual GDP growth+9,8% Primary Energy Consumption ~212 PJ Annual Change in Primary Energy Consumption -2,3% Electrification Rate99,99% Electricity Consumption6 403 GWh Annual change in electricity consumption +1,2%

10. Strategic Energy Policy Objectives Self-sufficiency Ability to cover domestic electricity needs any time by producers located in Estonia. Increase in the use of renewables Indicative target 5,1% of power by 2010 (2001-0,1%; 2005-1,2%). Main emphasise on the biofuels based CHP generation and windpower. Increase in the use of CHP-s Indicative objective 20% of power from CHP-s by 2020 (today 12- 13%). Efficiency Improvements: Primary Energy Consumption shall not exceed until 2010 the level of 2003.

11. Target 5,1%

12. Interesting Facts Transit of crude oil and its products via Estonian ports exceeds local consumption over 30 times. Power transit via Estonia from Russia to Latvia and Kaliningrad region represents ~10% of the total consumption. No congestions in the power and gas transmission grids – technically 100% of the power needs of Estonia could be imported. The share of district heating in the heating market is above 70%. CHP-s generate ~12% of power and ~40% of heat.

19. Conclusions  Estonia is a well-placed partner in the international energy markets  Energy market of Estonia is in many respects different from other countries  Estonia is headed towards own, but more sustainable energy supply  Energy efficiency improvements can decouple economic growth and energy consumption

20. Thank you for your attention! Ando Leppiman +372 6 256 481 Ando.Leppiman@mkm.ee