The Estonian competition authority has conducted an analysis regarding the use of long-term electricity purchase agreements and concluded that their establishment is not hindered by any legal or administrative restrictions.

The authority evaluated the regulatory and administrative obstacles associated with renewable energy sales contracts and proposed measures to reduce unjustified barriers to the adoption of such agreements.

Market participants have indicated that general legal and regulatory uncertainty, along with issues related to the financial capacity of market players, impede the signing of long-term electricity purchase agreements.

The competition authority's recommendations focus on addressing these bottlenecks to ensure a stable and reliable environment that encourages broader use of long-term electricity purchase agreements and increases investments in renewable energy production.

Furthermore, there is a need to develop the market for long-term electricity purchase agreements in Estonia and to analyze the feasibility of national and regional cooperation, including the establishment of a common market platform for the Baltic states in line with European Commission guidelines.

The public sector can set an example by consolidating its electricity consumption portfolio and directing demand towards long-term electricity purchase agreements.

When implementing directives, it is essential to carefully assess associated risks and, if necessary, develop mechanisms to mitigate the financial risks for smaller market participants.

The competition authority's analysis and recommendations regarding long-term electricity purchase agreements are available on its official website.