Estonia is making accessible, green power a big priority in a bid to reduce its reliance on fossil fuels, increase FDI, and achieve net-zero status. The country is actively exploring nuclear power as a potential solution, with a focus on small modular reactors (SMRs) that could be well-suited to Estonia’s energy needs and infrastructure.
Currently, the Estonian parliament (Riigikogu) is considering a draft resolution that would allow the development of nuclear power in the country. This draft is based on a 2021-2023 study by the Nuclear Energy Working Group, which concluded nuclear energy is feasible for Estonia. What’s also important, the majority of Estonians support nuclear energy deployment.
In the meantime, Fermi Energia is trying to make this breakthrough a reality by building Estonia’s first small nuclear power plant by 2035. Kalev Kallemets, chairman of the company’s management board, explained the background to this long-prepared project in the latest Life in Estonia magazine issue.
Why does Estonia need a nuclear power plant?
We need to achieve several important goals simultaneously and for the long term. As a Nordic country, we need energy supply security because the heating seasons are long. Secondly, we need to achieve carbon neutrality in all weathers. We also need increased industrial development and electricity consumption relating to green sources to meet the EU and Estonian 2050 carbon neutrality target. Price stability is also needed. This is a combined view, and we must also look at the fact that nuclear power has worked practically over the long term as a profitable solution in Canada, Finland, Sweden, and other European countries.
When could the plant be ready?
If all goes well, we are planning to submit an application for a national special planning scheme after a parliamentary decision later this year, and we are very pleased that two municipalities have agreed to participate. The first phase will take three years, the second two years, and once the site is determined, the application for a construction permit can be prepared. Once our reference plant in Canada is completed by 2028, we will be ready to apply for a construction permit and hopefully get this by 2030. A financing decision will then be made, and it could then be possible that the first reactor is generating electricity by 2035 and the second one a year or two later.
What will happen after the parliamentary decision?
The next steps are planning activities to identify the best location for the nuclear power plant in Estonia. The sites currently under consideration are in Virumaa. This part of the country has the best electricity network, industrial history, and today’s industry, although this is in decline due to regional development. Replacing the oil shale industry requires a clean, long-term, value-added industry that also provides high-value jobs. Secondly, legislation needs to be developed and human resources prepared. These steps will happen over the next three to five years and are not yet very costly for the country, totalling a few million. It will become more expensive when we get to the building permit procedure.
How many people would the nuclear power plant employ?
Quite many during the construction phase. We’ve also been in contact with over 30 construction, design, and engineering companies in Estonia and have already commissioned quite a lot of work. We definitely plan to continue doing this. In addition to the indirect employment, we are already a pretty good employer ourselves. Our organisation will certainly grow to more than a hundred people by the start of the construction phase, and one reactor will also be operated by a staff of around a hundred. In terms of employment, it will definitely be more efficient than today’s oil shale industry.
But we also have special features; for example, the plant’s employees can only be citizens of the Republic of Estonia who have passed security clearance, and they will be paid a pretty good salary for this. But because of the safety and the high level of trust in these people (as is the case in Finland, Sweden, and other parts of the world), there are very specific elements involved, as well as a high level of due diligence and the maintaining of high standards.
How much could the nuclear plant cost?
We’ve spent €7M up to now, and we’ll certainly spend another 30–40 million on development. We have done over 60 preliminary studies, and we already have 20 people on the payroll. We are also estimating the cost of construction in several phases, so it is too early to give final figures, but we expect it will come to around €3B euros. This will allow us to reach an electricity production cost of the order of €75 per megawatt hour.
Today, we are operating entirely on private investors’ money, and we are very pleased that there are some brave entrepreneurs in Estonia who have contributed. We have 1200 people in Estonia who have contributed financially to the development of nuclear energy through Funderbeam and believe that Estonia can do the complicated things. It’s a broad base of investors who are collectively investing in this, and nobody is taking too much risk. As we progress further, the share of foreign capital will probably increase.
After the Chernobyl and Fukushima accidents, there is always the question of the safety of nuclear plants. What about this?
There are more than a hundred reactors in the European Union near various cities. For example, nuclear power plants near Antwerp, Zurich, and Stockholm have been operating very safely and with very low environmental impact. With good regulation, good technology, and good operation, nuclear technology is even safer than wind power, and the environmental impact is quite low compared to other technologies. This is why the European Union has classified it in the taxonomy of sustainable financing, provided that certain technical requirements are met.
Imagining an ideal picture, what could the Estonian energy sector look like in the future? How much electricity would come from nuclear, renewables, and other sources?
I would very much hope that it would be as diverse as Estonia’s transport arrangements and with a low environmental impact, because future carbon emissions will be very expensive in the European Union. Therefore, the use of fossil fuels such as oil shale and natural gas is not sustainable. Renewable energies, and partly also storage technologies, will certainly play a very important role.
Nuclear energy will, therefore, still have an important role to play, as is planned in the Nordic countries, Canada, and the United States, in order to offer consumers long-term price security. Looking at the big picture, it is very difficult to consider the Estonian electricity market separately from Latvia and Lithuania, because we have common frequency control and prices. All in all, I believe that the share of nuclear energy in the Baltics could be 15–20% in order to ensure security of supply.
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