Energy, Estonia, Investments, Legislation

Although the profitability of the Auvere power plant and the reasonability of the 640-million-euro investment have been questioned for years, Eesti Energia management would still have to write off most of the investments at the end of this year, the newspaper reports.

Last year former head of the company Sandor Liive warned the government that if paying renewable energy support to the company would not be restored, it would mean that the value of the Auvere power plant would be written down by 300 million euros which would mean that only half of the sum invested into building it would remain.

CFO of Eesti Energia Andri Avila said that no decisions have been made and therefore there is no reason to speculate about a possible impact. He added that decisions will be most likely made in the next few months.

Another problem is the 12,000-hectare oil shale stocks in Utah, U.S. where 51 million euros have been invested so far. The project devours about one million euros a year.

Eesti Energia CEO Hando Sutter said recently that in America problems regarding producing oil from oil shale are logistical not technological. "While we can produce oil, gas and electricity from oil shale, they are only interested in oil there. There is nowhere to put the electricity since there is no grid. Gas also can't be used and oil should be transported very far to refine because a refining plant on site would make the project even more expensive," Sutter said.

Chairman of the Eesti Energia supervisory board Erkki Raasuke said that by now the Utah project has been practically frozen and costs have been brought down as much as possible.