The Estonian competition authority, Konkurentsiamet, has given its approval for the conditions of a large-scale heat procurement tender announced by AS Narva Soojusvõrk. The tender seeks to find new heat producers capable of providing a base load of 80-85 MW of production capacity and generating at least 300 GWh of heat annually starting from December 1, 2028.

This tender is open to all energy producers with experience in modern and efficient heat production technologies. Proposals that offer the lowest production costs, primarily utilize renewable energy sources, and implement environmentally friendly and innovative technologies will be favored in the evaluation process.

The best proposal will be selected based on multiple criteria, and the successful bidder will enter into a 12-year heat purchase agreement with Narva Soojusvõrk. This contract will ensure investment security for the entire amount proposed, providing a stable foundation for the establishment of new production capacities.

Currently, Narva's district heating network requires approximately 420-430 GWh of heat annually, making it the third largest in Estonia after Tallinn and Tartu. The establishment of new production capacities aims to cover at least 70% of the total heat demand for the network, marking a significant step towards enhancing the region's supply security and environmental sustainability.

At present, Enefit Power OÜ produces the necessary heat for Narva's district heating network using gas-fired steam boilers, which no longer meet modern efficiency standards and are insufficient to meet Narva's heat demand. Additionally, the price of natural gas is significantly higher and more volatile compared to alternatives like wood chips, complicating the provision of stable and affordable heat prices for consumers.

Once the new production facilities are completed, the existing gas boilers will remain in use for peak load coverage. The authority is also monitoring regional consumption trends, including building renovations and energy efficiency improvements, which may reduce future heat demand. Opportunities to integrate new electricity generation capacities into the district heating network for peak load coverage are also being assessed.

Konkurentsiamet encourages all capable heat producers to actively participate in the tender, viewing it as a significant opportunity to contribute to the modernization of the energy system in the Narva region and to provide consumers with sustainable, stable, and affordable heat. The authority's approval of the tender conditions is based on the expectation that AS Narva Soojusvõrk will ensure the best possible heat supply prices for consumers as a result of the tender.

The tender conditions and additional information will be published on the AS Narva Soojusvõrk website.