TALLINN, Dec. 9 (Xinhua) -- The European Commission has approved Estonia's 2.6 billion euros (2.8 billion U.S. dollars) program to support offshore wind farms by offering these power plants a guaranteed price for the electricity they produce.
Brussels' permission gives the green light to hold auctions with the lowest price, before which a number of amendments to the legislation will also need to be made, reported on Monday the Estonian Public Broadcasting (ERR), citing the Ministry of Climate.
The offshore wind farm program aims to support the transition to a climate-neutral economy. It will provide support for the construction and operation of these power plants in Estonia's maritime zone.
The permit allows Estonia to enter into guaranteed electricity price agreements with power plant operators for 20 years. The maximum subsidy amount is two terawatt-hours of electricity per year.
Under this scheme, the market price of electricity sold by an offshore wind farm will be compared with the performance price of the contract.
If the market price is lower than the price fixed in the contract, the state will pay the difference to the power plant, but not more than 65 euros per megawatt-hour (6.5 cents per kilowatt-hour). If the market price is higher than the price in the contract, then the difference will be returned by the power plant.
It is planned that the government will order the Ministry of Climate to hold such auctions in April 2025. New onshore wind farms must begin producing electricity by 2029, and offshore wind farms by the end of 2033. (1 euro = 1.06 U.S. dollar) ■
