Author(s)

J. Kleesmaa, S. Pädam & Ü. Ehrlich

Abstract

The purpose of this paper is to assess the impact of Estonia’s feed-in tariffs (FIT) on combined heat and power (CHP) plants. The assessment follows previous practice and provides a novel approach by including a case study based on company data. The results of our assessment show that the Estonian FIT system has effectively supported the establishment of CHP capacity and that the administrative costs have been low. In contrast to experiences in other countries we find that the avoided external costs exceed the per MWh cost of FIT. Another feature is that the consumer costs of the FIT scheme have grown more rapidly than elsewhere. Although avoided external costs cover FIT, resources are not used cost-effectively. The case study of two CHP plants suggests that resources are used for supporting production that would have been profitable without FIT. Keywords: renewable electri , feed-in tariffs, CHP, energy policy, Estonia.

Keywords

renewable electri , feed-in tariffs, CHP, energy policy, Estonia