Elering plans to lease Kiisa power plant to private operators
Friday 30th October 2026 on 14:30 in
Estonia
Estonia’s electricity system operator Elering plans to lease the Kiisa power plant to private operators by the end of 2027, ERR reported. From May 1, 2027, it will reduce the plant’s contribution to the Baltic frequency reserves market by 100 megawatts.
Elering said the change would support greater use of market-based reserves while preserving enough flexibility to ensure the security of the electricity system. The company will begin preparations to lease the plant at the earliest opportunity, currently expected to be late 2027.
Leasing the plant would allow it to participate in all electricity markets, including the day-ahead market, and provide additional generation during hours of high prices. Elering said its analysis indicates that the plant’s participation in the day-ahead market could lower electricity prices by an average of about 0.9 euros per megawatt-hour.
Energy and Environment Minister Erkki Keldo said much of Kiisa’s capacity currently remains on reserve for most of the time. He said the growth of private suppliers in the reserves market meant the state did not need to compete where private companies could provide the service. Elering’s analysis found that the number of reserve-service providers had increased by 185 percent and the volume of offers by 75 percent.
Elering board chairman Kalle Kilk said the electricity system would remain secure as the plant’s role was reduced. He said the Baltic frequency reserves market was operating well and market-based reserves had become more available.
The change will affect balancing fees. The fee is currently 3.73 euros per megawatt-hour and is set to rise to 3.89 euros from May 1, 2027. It will be 2.97 euros during the first four months of 2027, a rate announced in June 2026.
For a household using 250 kilowatt-hours of electricity per month, the fee change would add about five cents to the monthly bill, including VAT, from May 2027 compared with the current level. From January through April, the fee would be about 25 cents a month lower than at present. Elering estimates that balancing capacity currently costs such a household about 1.20 euros a month, including VAT, rising to about 1.25 euros from May 2027.