The Government of Estonia, during the lockdown on March 27, allocated 125 million euros in share capital to the state-owned energy company Eesti Energia to establish a shale oil plant [1] and is currently discussing co-investing in a 600-million-euro shale oil pre-refinery factory [2].

In the letter [3], the signatories call attention to how the Government’s investment and plans support the country’s lock-in to and continued exploitation of oil shale, promotes the export of CO2 emissions and likely increases the global emissions. This directly sabotages the objectives of the EU Just Transition Fund, which the Government aims to apply for, raising doubt in the effectiveness of the Fund and the appropriateness of the use of EU taxpayers’ money.

“The conflicting steps by the Estonian Government highlight the shortcomings in the EU’s plan to attain carbon neutrality by 2050,” highlights Uku Lilleväli, an Advocacy Expert of the initiator of the letter, Estonian Fund for Nature. “The fact that a member state could receive EU funds to pursue a just transition while using its own resources to support entirely contradicting aims suggests to severe inconsistencies concerning how the EU allocates its funds and incentivises the member states to achieve the climate goals.”

The signatories raised concerns over the priorities of Estonia to invest in shale oil during the on-going pandemic, instead of meeting the urgent healthcare and economic needs, for which Estonia received 295 million euros also from the EU [4]. “The decision of the Estonian government to invest taxpayers’ money in a high-risk sector is unacceptable and irrelevant to what the rest of the EU is trying to achieve, especially when there is an urgent need to utilise our resources to address the COVID-19 economic shortfalls and ensure a green recovery for us all,” emphasizes Elif Gündüzyeli, the Senior Policy Coordinator of a signatory, Climate Action Network Europe.

The signatories inquired about the views of the European Commission regarding the described controversies and how the Commission aims to ensure that Estonia or other member states plausibly receiving the Just Transition Fund will not use their own resources to support contradicting goals. The letter has been signed by Climate Action Network Europe (CAN Europe), CEE Bankwatch Network, Estonian Fund for Nature, Estonian Green Movement, Estonian Environmental Law Center, and many organizations.

Notes for Editors:

[1] Government green lights new €286 million oil shale plant (Estonian Public Broadcasting ERR, March 27, 2020)
[2]  XIV Riigikogu Verbatim record, III istungjärk (Parliament of Estonia, April 20, 2020)
[3] Inquiry about the EU-related controversies regarding Estonian Government’s investments and goals on shale oil (Estonian Fund for Nature, May 12, 2020)
[4]  Estonia to get €295 million from EU to combat coronavirus (Estonian Public Broadcasting ERR, March 16, 2020)