Elektrituruseadus (ELTS)

§ 1. Scope of application of this Act

(1) This Act governs the generation, storage, transmission, sale, export, import and transit of electricity and the economic and technical management of the power system. This Act prescribes the principles of the functioning of the electricity market, based on the need to ensure an effective supply of electricity that is provided at a reasonable price and that meets environmental requirements and the needs of consumers, as well as the utilisation of energy sources in a balanced manner, in an environmentally sustainable way and with a long-term perspective.

(2) The activities mentioned in subsection 1 of this section are carried out observing the principles of cooperation, equal treatment and transparency.

(2¹) An electricity undertaking pays a regulatory enforcement fee on the grounds and in accordance with the rules provided by the Competition Act.

(3) Electricity undertakings facilitate consumer action to save electricity.

(4) The provisions of the Administrative Procedure Act apply to administrative proceedings provided by this Act without prejudice to special rules provided by this Act.

(5) This Act, with the exception of §§ 58–59⁶, 92⁵, 108, 108¹ and subsection 3 of § 111³, does not apply to power stations that are not connected to the network.

§ 3. Definitions

The terms in this Act are defined as follows:

1) ‘emergency reserve power station’ means a power station where electricity is generated in the case of an unexpected shutdown of a production or transmission capacity of the system or of the power system of another country that is electrically connected to the system or in the event of a threat to the security of supply of the system;

1¹) ‘open supply’ means the sale to a market participant of the total amount of electricity needed by the market participant or, in order to ensure the balance of a market participant, the sale to the market participant of an amount of electricity that the participant lacks in a trading period or the purchase from the market participant of surplus amount of electricity during a trading period;

1²) ‘aggregator’ means a person who provides aggregation services and who, at the same time, may be a seller or a balance provider;

1³) ‘aggregation’ means the activity consisting in combining the consumption load of consumers or the generation capacity of producers for sale or purchase in the electricity market;

1⁴) ‘active user of network services’ means a consumer or a group of consumers who consume, store or sell electricity that has been generated on real property owned by them (hereinafter, ‘self-generated electricity’), or who provide flexibility services or use self-generated electricity for the purpose of improving the building’s energy performance – provided such an activity is not their principal business or profession;

2) ‘balancing electricity’ means electricity that, for the purposes of maintaining a balance, is purchased and sold by the system operator under a balance agreement concluded with a balance provider;

3) ‘balance’ means equivalence between the amount of electricity purchased and/or supplied to the network by a market participant during a trading period and the amount of electricity sold and/or acquired from the network by the market participant during the trading period;

4) ‘balance settlement’ means determination of the balance by a method that permits, during every trading period, to state the balance for the market participant, to ascertain the amount of open supply and, where deviations from the balance are detected, to create a corresponding report;

4¹) ‘net metering during the trading period’ means calculating the balance of electricity that passes through the metering point during the trading period in the direction of generation and of consumption side;

5) ‘balance responsibility’ means the obligation of a market participant to ensure that the amount of electricity purchased and/or supplied to the network by the market participant during a trading period is equivalent to the amount of electricity sold and/or acquired from the network by the market participant during the trading period;

6) ‘balance agreement’ means an open supply contract between the system operator and a balance provider by which the system operator undertakes to sell to or purchase from the balance provider the amount of balancing electricity necessary to maintain its balance during each trading period;

6¹) ‘dynamic electricity price contract’ means an electricity contract that reflects, in full or in part, price fluctuations during trading periods in the day-ahead market of Estonia’s price area;

7) ‘transmission’ means the transport of electricity in the network;

7¹) ‘power exchange’ means an organised market for trade in electricity to be supplied on the same or next day or within the hour;

7²) ‘electricity market’ means a platform intended for trade in electricity, capacity and flexibility as well as ancillary services;

8) ‘power station’ means an operational assembly consisting of one or several generating installations that generate electricity, together with auxiliary equipment and civil engineering works;

8¹) ‘power plant own consumption’ means electricity that is required for the smooth functioning of the power plant and of the facilities and equipment attached thereto, including the electrical and lighting systems, control, safety and monitoring systems, accumulation devices, emergency sources of power, pumps, ventilators, conveyors, electric motors of fuel loading and preparation equipment and electric heating systems;

8²) ‘storage of electricity’ means conversion of electricity into a form of energy that can be stored, the storing of such energy and its subsequent reconversion into electricity or use as another energy carrier with the purpose of deferring the final use of electricity from the time of its generation to a later time or of optimising the load of the power system during the storage period;

8³) ‘electricity contract’ means a contract for the sale of electricity, including a contract between a natural or legal person and a producer for the sale of renewable electricity, except for contracts concerning electricity derivatives;

8⁴) ‘energy storage unit’, in an electrical installation, means a part of such an installation that is used for the storage of energy, including an electric vehicle recharging point that allows for bidirectional charging;

8⁵) ‘energy service provider’ means a provider of energy service within the meaning of clause 11 of § 2 of the Energy Sector Organisation Act;

8⁶) ‘energy efficiency’ means energy efficiency within the meaning of clause 12 of § 2 of the Energy Sector Organisation Act;

9) ‘electrical installation’ means an installed operational assembly of equipment, conductors and accessories used to generate, transmit, convert, store, meter, sell or consume electricity;

9¹) ‘import’ means the import of electricity from outside the European Economic Area or Swiss Confederation with the aim of selling or consuming electricity in Estonia;

9²) ‘investment support’ means financial assistance, a loan granted on conditions more favourable than market conditions, surety or a financial guarantee or other State aid or de minimis aid granted to cover the cost of building or reconstruction of a generating installation or part of such an installation;

10) ‘distribution’ means the transmission of electricity via a distribution network;

11) ‘distribution network’ means a network that is not the transmission network;

12) ‘remote reading device’ means a metering device that records data regarding amounts of electricity by trading period and allows automatic transmission of such data without the need to physically access the metering device;

13) ‘trading period’ means the period of time which is provided by the network code on the functioning of the electricity market and during which a market participant is required to maintain its balance;

13¹) ‘recharging point’ means an interface that allows, at a time, to recharge one electric vehicle or to exchange the battery of one such vehicle;

13²) ‘smart recharging’ means a recharging operation in which the intensity of electricity delivered to the battery is adjusted dynamically, on the basis of information received through electronic communication;

14) ‘line’ means a part of a network that links specific points in the network;

15) ‘connection point’ means a specific, defined point where an electrical installation of a market participant and the network connect;

15¹) ‘metering point’ means a location where electricity passing through an electrical installation is measured;

16) ‘metering device’ means an electricity meter together with instrument transformers and tariff switching devices, including metering devices that do not receive or transmit data;

17) ‘fixed supply’ means the sale to a market participant of a fixed amount of electricity which is agreed upon in advance for a trading period and of which the balance provider is informed in advance under the rules established in this Act and the network code on the functioning of the electricity market;

18) ‘sale’ means the transfer of electricity to another person for a charge or without charge;

19) ‘net capacity’ means the maximum capacity that can be supplied to the network by a generating installation;

19¹) ‘availability of net capacity’ means the ability to supply net capacity to the network within 24 hours from the moment the corresponding order is issued by the system operator;

19²) ‘existing transmission network’ means a transmission network – or a new substation or transmission network that, on account of the connection to be created, is to be constructed within up to one span of the existing overhead line in accordance with the transmission network operator’s schedule of investments – characterised by the voltage and security of supply level that apply at the time of the filing of connection application, as well as, in a situation where the existing substation cannot be expanded any further, a new substation to be constructed;

20) ‘direct line’ means a line that is located in the service area of a network operator and that lacks a direct connection to the network, except for a closed distribution network, but that may be indirectly connected to the network through an electrical installation of a market participant and that serves to transmit electricity from a power station to another power station or to another market participant for its own consumption, resale or transmission;

20¹) ‘flexibility service’ means a service that permits, in a cost-effective way, to reduce the need to increase or replace the throughput capacity of the network by expanding the electricity market, among others, to producers of electricity from renewable sources, to distributed producers, to market participants participating in demand response, to undertakings operating energy storage activities, to providers of reserve capacity required for system management and to aggregators;

20²) ‘regional coordination centre’ means a regional coordination centre established under Article 35 of Regulation (EU) 2019/943 of the European Parliament and of the Council on the internal market for electricity (OJ L 158, 14.06.2019, pp. 54–124);

21) ‘transmission network’ means a national network with a voltage of at least 110 kV together with connections that have a voltage of over 10 kV with networks of other countries and together with other electrical installations, including those operating on medium voltage, that are necessary to ensure the functioning, administration and development of the system as a whole and together with control, protection and communication systems that form a single economic entity;

22) ‘regulating capacity’ means the capacity purchased under contracts entered into by the system operator, which the latter uses to increase or reduce generation and consumption in accordance with this Act and the legislation enacted under it and in accordance with contracts concluded by the system operator;

22²) ‘closed distribution network’ means a network that is used to transmit electricity within limited production locations, commercial-purpose civil engineering works or joint services locations to commercial consumers that are located there and whose activities or production processes are interconnected for technical or safety-related reasons, or that is used to transmit electricity chiefly to the owner of the network or to the network operator who operates the network, or to any undertakings that are connected to the owner or network operator by means of control;

22³) ‘non-frequency ancillary service’ means a service used by a network operator for steady state voltage control, fast reactive current injections, inertia for local grid stability, short-circuit current, black start capability and island operation capability;

22⁴) ‘storage period’ means the calendar month, during which the energy taken from and fed back into the network is deemed stored energy;

22⁵) ‘connected undertakings’ means two or more undertakings of a group, as well as undertakings belonging to the same shareholders;

23) ‘system’ means a technical system for the generation, storage and transmission of electricity, which is composed of power stations located in the territory of Estonia, of the network which connects the power stations to one another as well as consumers and the power systems of other countries, and the corresponding control, protection and communication systems;

23¹) ‘place of consumption’ means a connection point of an electrical installation of a market participant, or a number of connection points that are connected to each other through an electrical installation of a market participant;

23²) ‘balancing’ means the processes and actions mentioned in point 10 of Article 2 of Regulation (EU) 2019/943 of the European Parliament and of the Council;

23³) ‘demand response’ means control of electricity consumption load that consists in a consumer’s independently changing their consumption or in an offer, made through an aggregator and accepted, to sell a reduction or increase in their consumption at the price offered by an organised market defined in point 4 of Article 2 of Commission Implementing Regulation (EU) No. 1384/2014 on data reporting implementing paragraphs 2 and 6 of Article 8 of Regulation (EU) No. 1227/2011 of the European Parliament and of the Council on wholesale energy market integrity and transparency (OJ L 363, 18.12.2014, pp. 121 –142);

24) ‘generation’ means the production of electricity. For the purposes of this Act, generation does not include the generation of electricity by a generating installation that has a total net capacity not exceeding 100 kW and that is not connected to the system;

25) ‘generating installation’ means an electrical installation intended for the generation of electricity;

26) ‘transit’ means the transmission of electricity under a contract whereby the parties to the contract do not consume or generate transmitted electricity in Estonia;

26²) ‘ancillary service’ means a service required to operate the network, as well as balancing and non-frequency ancillary services except for congestion management;

26³) ‘fully integrated network component’ means a component that has been integrated into the network and whose sole purpose consists in ensuring a secure and reliable functioning of the network and which is not used for the purposes of balancing, the covering of losses or congestion or frequency management;

26⁴) ‘the universal service’ means the sale, according to § 76⁵ of this Act, of electricity to a consumer of the universal service within the territory of Estonia;

26⁵) ‘contract for a specified period with a fixed electricity price’ means an electricity contract for a fixed effective period whose contractual terms and electricity price remain unchanged during the effective period;

26⁶) ‘switching fee’ means a fee that, directly or indirectly, is set for the consumer by the seller of electricity or by the aggregator for switching to another supplier or market participant providing aggregation services;

27) ‘control’ means control of an undertaking as defined in the Competition Act;

28) ‘security of supply’ means the capability of the system to ensure that consumers are supplied with electricity in accordance with the requirements;

28¹) ‘liquid biofuel’ means liquid fuel derived from biomass and used for the generation of electricity;

28²) ‘vertically integrated undertaking’ means an electricity undertaking that is or electricity undertakings that are controlled within the meaning of the Competition Act by one person or several persons and at least one of the tasks of which is transmission of electricity, while the other tasks include the generation or sale of electricity;

28³) ‘horizontally integrated undertaking’ means an electricity undertaking performing at least one of the functions of generation for sale, or transmission, or distribution, or supply, and another non-electricity activity;

29) ‘network’ means an electrical installation – or a part of such an installation – designed to convey electricity to the connection point of a consumer or of a producer;

30) ‘grid code’ or ‘network code’ means a legislative instrument mentioned in § 42 of this Act;

31) ‘network service’ means a service mentioned in subsection 1 of § 65 of this Act;

32) ‘network connection’ means an electrical connection between the network and another electrical installation;

33) ‘connection to the network’ means the establishment of a new network connection, or the modification of the conditions of consumption or any other technical conditions or an increase in the security of supply of an existing network connection;

34) ‘use of a network connection’ means the use of network services via a network connection;

34²) ‘V2G system’ means a system consisting of a vehicle and of the vehicle charger that allows electricity to be fed from the grid to the vehicle battery and vice versa;

34³) ‘recharging point not accessible to the public’ means a normal-power recharging point that is not accessible to the public and that habitually serves as a parking spot for electric vehicles for longer periods of time;

35) ‘transmission’ means the transport of electricity via the interconnected extra high-voltage or high-voltage network with the purpose of conveying electricity to a consumer or a distribution network operator, with the exception of sale;

36) ‘micro isolated network’ means a network which is located in the service area of a distribution network operator, which belongs to that operator, which does not have an electrical connection to the system and in which consumption in 1996 was less than 1 gigawatt-hour (hereinafter, ‘GWh’);

37) sector at risk of carbon leakage – sector for which the multiplication of its EU-level trade intensity and electro-intensity reaches at least 0,6 per cent and whose EU-level trade intensity and electro-intensity are at least four per cent and five per cent respectively;

38) sector at significant risk of carbon leakage – sector for which the multiplication of its EU-level trade intensity and electro-intensity reaches at least two per cent and whose EU-level trade intensity and electro-intensity are at least five per cent for each indicator.

§ 4. Maintaining the security of supply

(1) The Government of the Republic may implement measures with regard to all market participants to maintain the security of supply during a defined period of time if any of the following becomes evident:

1) a factor endangering the security of supply;

2) the scarcity of primary energy sources;

3) a danger to the life or health of persons or to the preservation of the network or any other electrical installation.

(2) The measures mentioned in subsection 1 of this section may be implemented without observing the provisions of Chapters 3–7 of this Act if this is vital for ensuring the security of supply.

(3) In a situation mentioned in subsection 1 of this section, the Government of the Republic establishes the grounds for the calculation of costs incurred as a result of implementing the measures, as well as the list of persons who are required to pay compensation for such costs and of persons who are entitled to compensation, and the extent of and rules for the compensation of the costs.

(4) In a situation mentioned in subsection 1 of this section, the following measures may be applied:

2) imposition of an obligation to procure and store reserves of primary energy sources required for generation;

3) suspension or restriction of the rights granted by this Act to producers or any other market participant;

4) limitation or interruption of the supply of electricity to particular market participants;

5) restriction or modification of the obligation to provide network services.

§ 5. Market participants

Market participants are electricity undertakings, consumers, energy communities, balance providers and the power exchange operator.

§ 6. Electricity undertaking

(1) An electricity undertaking is a natural or legal person who is not a consumer and who engages in electricity:

1) generation;

2) transmission;

3) distribution;

4) aggregation;

5) consumption management;

6) storage;

7) sale;

8) purchase.

(2) An electricity undertaking is responsible for any commercial, technical or maintenance matters related to activities mentioned in subsection 1 of this section.

§ 7. Producer

(1) A producer is an electricity undertaking engaged in the generation of electricity by means of one or several generating installations.

(2) A small producer is a producer the net capacity of whose generating installations which are located in Estonia, together with the net capacity of generating installations located in Estonia and owned by producers belonging to the same group as the producer does not exceed 10 MW.

§ 8. Network operator

(1) A network operator is an electricity undertaking engaged in the provision of network services through a network.

(2) The transmission network operator is an electricity undertaking engaged in the provision of network services through the transmission network.

(3) A distribution network operator is a legal person who is engaged in the provision of network services through a distribution network and who is responsible for operating, maintaining and developing the distribution network in its service area and for connecting it to other networks. A distribution network operator ensures the network’s long-term capacity to cater to reasonable demand for electricity distribution.

§ 9. Line possessor

A line possessor is an electricity undertaking that conveys electricity via a direct line or a direct current line which crosses the national border.

§ 10. Seller

The seller is an electricity undertaking engaged in the sale of electricity.

§ 11. Balance provider

The balance provider is a person who, following the rules provided by this Act and the legislation enacted under it, has concluded a balance agreement with the system operator in order to maintain its balance.

§ 11¹. Power exchange operator

A power exchange operator is the nominated electricity market operator designated by the Competition Authority in accordance with paragraph 3 of Article 4 of Commission Regulation (EU) 2015/1222 (OJ L197, 25.07.2015, pp. 24−72).

§ 11². Power exchange trader

A power exchange trader is a market participant to whom the power exchange operator, by a corresponding agreement concluded with the trader, has granted a right to trade on the power exchange.

§ 12. Consumer

(1) A consumer is a person who uses electricity for the person’s own purposes.

(1¹) ‘Household consumers’ means consumers using electricity for their own household consumption, excluding their commercial or professional activities.

(1²) ‘Commercial consumers’ means consumers who are not household consumers.

(1³) ‘Small consumers’ means household consumers, apartment associations, building associations and such commercial consumers whose electrical installation is connected to the network at low voltage and through a main circuit breaker of up to 63A.

(2) For the purposes of this Act, a person who purchases electricity is deemed to be a consumer only in respect of the electricity that the consumer uses for the consumer’s own purposes.

(3) A person who uses electricity generated for the power station’s own consumption is not considered a consumer.

(4) ‘Consumer of the universal service’ means a household consumer, a municipal administrative authority, an institution administered by a municipal administrative authority as well as any person who purchases electricity in quantities that they need in order to transmit and sell it to the aforementioned persons, and to whom the universal service is provided under § 76⁵ of this Act.

§ 12¹. Active user of network services

(1) A consumer may operate as an active user of network services.

(2) An active user of network services has balance responsibility and a right to:

1) operate directly or through aggregation;

2) sell any electricity it has generated;

3) participate as a provider of flexibility or energy performance services;

4) delegate, to a third party, the management, installation, operation and maintenance of any equipment as well as the processing of any data required for its operations.

(3) A person to whom an active user of network services has delegated the management, installation, operation and maintenance of any equipment as well as the processing of any data required for its operations is not deemed an active user of network services.

(4) Within the scope of its balance responsibility, a balance provider is an active user of network services – except where it has delegated its balance responsibility in accordance with Article 5 of Regulation (EU) 2019/943 of the European Parliament and of the Council.

(5) An active user of network services that owns an energy storage unit is allowed to provide several flexibility services at the same time.

§ 12². Energy community

(1) An energy community is a legal person:

1) participation in which is voluntary and open and which is controlled by members who are natural or legal persons;

2) whose principal aim is, instead of a monetary profit, to provide environmental, economic or social benefits to its members or to the area in which the community operates;

3) which may provide energy services to it members;

4) whose members retain rights and obligations that they hold bi virtue of legislation made under this Act as a household consumer or as an active user of energy services.

(2) Where an energy community supplies electricity that it has generated itself for consumption to its members, it does this using installations erected by the community or a service provided by the area’s distribution network operator.

(3) A member of an energy community may resign from the community, giving at least six months’ notice of the resignation.

(4) An energy community has balance responsibility. Within the scope of its balance responsibility, an energy community is a balance provider – except where it has delegated its balance responsibility in accordance with Article 5 of Regulation (EU) 2019/943 of the European Parliament and of the Council.

(5) An energy community that consumes electricity generated by itself is an active user of network services within the meaning of § 12¹ of this Act.

§ 15. Requirements with respect to form of operation and capital

(1) An electricity undertaking that possesses legal personality is a person registered in the European Economic Area.

(2) The share capital of a network operator or of a line possessor who uses a direct current line which crosses the national border is at least 127,800 euros.

(3) The share capital of a producer or seller is at least 31,950 euros.

(4) Subsection 1 of this section does not apply to a line possessor who uses a direct line.

(5) Subsections 1 and 3 of this section do not apply to a producer and seller who generates or sells electricity that has been produced by a generating installation which they own and which has a total net capacity of up to 1 MW.

(5¹) Subsections 1 and 3 of this section do not apply to the sale of electricity by a consumer, if that electricity has been transmitted to the consumer via a direct line and has been produced by a generating installation that has a net capacity of up to 1 MW.

(6) Subsections 1 and 3 of this section do not apply to:

1) a person who, outside its principal activities and within the boundaries of a building or immovable which belongs to them or is entirely in their possession, sells and conveys electricity solely to persons who use the building or immovable on lawful grounds, provided the sale of electricity is not the seller’s principal activity;

2) a non-profit organisation who sells and conveys electricity to its members solely for the purpose of supplying electricity to the apartments, cottages, garages or private dwelling houses which the members own or occupy.

§ 16. Unbundling of activities

(1) If this Act does not prohibit an electricity undertaking from operating in several electricity-related or other areas of activity at the same time, the electricity undertaking must, in order to avoid discrimination, cross-subsidisation and distortion of competition, keep accounts of its electricity-related and other areas of activity as well as of the different electricity-related areas of activity listed in subsection 1 of § 22 of this Act as would be required of separate undertakings operating in those areas.

(2) The operator of the transmission network or of a distribution network to which more than 100,000 consumers are connected may not generate or sell electricity.

(3) It is not contrary to subsection 2 of this section for:

1) the transmission network operator to perform the obligations provided by Chapters 3 and 4 of this Act;

1¹) the operator of the transmission network to generate electricity in the emergency reserve power station in the event of an unexpected shutdown of the production capacity or net capacity of the system or of the power system of another country electrically connected to the system or in the event of a danger to the security of supply or when it is required for the purpose of periodical testing of the emergency reserve power station;

2) a network operator only to generate electricity to compensate for network losses;

2¹) a distribution network operator whose service area includes a micro isolated network, to produce or sell electricity to a seller of electricity in the area of the micro isolated network;

3) other undertakings belonging to the same group as the network operator to operate in other areas of activity.

(4) The transmission network operator may not at the same time be a distribution network operator, or belong to the same group with any undertaking which engages in activities related to generating or selling electricity.

(4¹) It is not contrary to subsection 1 of this section when the transmission network operator establishes a joint enterprise with an undertaking who owns the transmission network in another member state and acts as the operator of the transmission network, or with an undertaking who is an independent system operator recognised in another member state in accordance with Article 44 of Directive (EU) 2019/944 of the European Parliament and of the Council concerning common rules for the internal market in electricity and amending Directive 2012/27/EU (OJ L 158, 14.06.2019, pp. 125–199) or an independent transmission network operator within the meaning of Section 3 of Chapter VI of the same Directive.

(4²) Where the transmission network operator is split off from a vertically integrated undertaking, the transmission network operator may not convey the business secrets in its possession to an undertaking engaged in production or sale and the employees of the transmission network operator may not, in the course of the split, accept employment positions with an undertaking engaged in production or sale.

(5) The trade mark and communication of the operator of a distribution network must be clearly distinguishable from that of an undertaking which engages in the generation or sale of electricity and which belongs to the same group as the operator, provided more than 100,000 consumers are connected to its distribution network.

§ 17. Reporting and auditing

(1) The Government of the Republic may enact additional justified requirements for electricity undertakings regarding their accounts and the disclosure of their reports with a view to ensuring transparent reporting of the revenues from and expenditures on electricity-related activities and of transactions between undertakings that belong to the same group.

(2) An electricity undertaking includes in its annual accounts an explanation of the principles for allocating expenditures among the electricity undertakings belonging to the same group. The principles may be amended by the electricity undertaking only in exceptional circumstances. Any amendments and the reasons for such amendments are described in the annual accounts.

(3) An electricity undertaking files, as annexes to its annual accounts, a report including a balance sheet and a profit and loss account for each area of activity, as well as the accounting principles based on which these have been compiled.

(4) An electricity undertaking arranges for the auditing of its annual accounts following the requirements provided by §§ 91 and 92 of the Auditors’ Activities Act. A producer whose generating installation equals or exceeds the capacity of 1 MW and who is not subject to the auditing requirement under §§ 91 and 92 of the Auditors’ Activities Act, is subject to the obligation to have its annual accounts inspected. In addition to arranging for the auditing of their annual accounts, the electricity undertakings also arrange for the auditing of the report mentioned in subsection 3 of this section (hereinafter, ‘special-purpose assignment’). Where an official audit of the annual accounts is performed, the special-purpose assignment is carried out in accordance with the sworn auditors’ professional activities standard ISA 800 and, in the case of an inspection, in accordance with the standard ISAE 300, as an assurance engagement. In the sworn auditor’s report that sets out the results of the special-purpose assignment, the auditing undertaking states its opinion or conclusion concerning compliance, in accordance with the provisions of § 16 of this Act, with the requirement provided by subsection 3 of this section.

(5) Producers whose generating installations have a capacity that falls below 1 MW, are not subject to the auditing requirements provided by subsection 3 – and to subsection 4 insofar as compliance with the requirements provided by subsection 3 is concerned.

§ 18. Management of distribution network operators

(1) A member of the management board of a distribution network operator may not at the same time be a member of the management board of another electricity undertaking connected to the distribution network operator by means of control, or otherwise be in charge of the day-to-day economic operations of another electricity undertaking which belongs to the same group as the distribution network operator.

(1¹) Subsection 1 of this section does not restrict the right of a member of a distribution network operator’s management or supervisory board or of any other person responsible for the operator’s day-to-day economic operations to be a member of the management or supervisory board – or a person responsible for the day-to-day economic operations – of another network operator connected to the first by being controlled by it.

(1²) A distribution network operator mentioned in subsection 1 of this section whose legal form is that of a private limited company must have a supervisory board.

(1³) The Articles of Association of a distribution network operator mentioned in subsection 1 of this section may not, under subsection 2 of § 317 of the Commercial Code, vest in its supervisory board the right to decide on matters not provided for by subsection 1 of that section.

(1⁴) The proposal – to the general meeting of a distribution network operator mentioned in subsection 1 of this section whose sole shareholder is an electricity undertaking that is a State-owned company – to appoint or recall members of the operator’s supervisory board is made by the Committee for Appointment of Members of Supervisory Boards of Partly State-Owned Companies mentioned in § 80¹ of the State Assets Act.

(4) Any remuneration paid or any other benefit provided to a member of the management board of a distribution network operator or a person responsible for the operator’s day-to-day economic operations may not depend on the commercial performance of another electricity undertaking or of a person who controls that undertaking.

(5) A distribution network operator must have at its disposal the technical, physical, financial and human resources required for the preservation and development of the assets needed for the provision of network service. This does not preclude a parent company from carrying out economic and management oversight over the return on the subsidiary’s assets, which primarily includes the right to approve the annual budget of the operator – including a financing plan – and the ceiling limit for the subsidiary’s debt. The parent company may not intervene in the day-to-day economic operations of the subsidiary or in decisions concerning the construction or upgrading of the network, provided these decisions do not exceed the limits of the approved annual budget.

(5¹) Any services that a distribution network operator requires in order to provide network service are procured on conditions that are transparent, non-discriminatory and market-based.

(6) A distribution network operator formulates and implements a plan which lays out the measures necessary to ensure equal treatment of other electricity undertakings and consumers and states the obligations of the employees of the distribution network operator to implement such measures. The operator files the plan with the Competition Authority.

(7) The plan mentioned in subsection 6 of this section is formulated, its implementation is monitored, and the annual report concerning measures taken to implement it is compiled by an employee who is appointed by a member of the distribution network operator’s management board and fulfils the conditions established by the operator’s supervisory board, who is independent in formulating the plan and has access to the entirety of the operator’s data and of the data of any other undertaking belonging to the group of companies to which the operator belongs insofar as these data are required for the performance of such an employee’s task.

(8) A distribution network operator files its annual report with the Competition Authority and informs the Competition Authority of the availability of the report on its website.

§ 18¹. Management of transmission network operator and of line possessor using a direct current line that crosses the national border

(1) A person who controls the transmission network operator may not control, or exercise any other rights in respect of, an undertaking which produces or sells gas or electricity. A person who controls an undertaking which produces or sells electricity may not control, or exercise any other rights in respect of, the transmission network operator, or in respect of an undertaking which provides gas transmission services,

(3) The person who appoints members of the supervisory or management board of the transmission network operator or members of a body that legally represents the transmission network operator may not have control over an undertaking which produces or sells gas or electricity or exercise any other rights in respect of that undertaking.

(3¹) The other rights mentioned in subsections 1 and 3 of this section include, first and foremost, voting rights, the right to appoint members to the supervisory or management board of the undertaking or to a body that legally represents the undertaking, holding a controlling interest in the undertaking, or using or disposing of property forming a part of the transmission network.

(4) A member of the supervisory or management board of the transmission network operator may not be a member of the supervisory or management board of an undertaking which produces or sells electricity or a member of a body that legally represents such an undertaking.

(5) Where the person mentioned in subsections 1 and 3 of this section is the State, the transmission network operator may not be controlled by the same authority that controls an undertaking which produces or sells electricity.

(6) An undertaking engaged in production or sale may not have control over a transmission network operator in a member state of the EU that applies the requirement of the separation of ownership of transmission network operators from undertakings engaged in production and sale.

(7) Management of the line possessor that uses a direct current line crossing the national border is subject to the requirements established in this section with respect to the transmission network operator.

§ 19. Notification requirement

(1) A person notifies the Competition Authority in writing if they:

1) acquire ownership of a network or a personal right to use a network;

2) commence construction of a generating installation with a net capacity of over 1 MW, acquire a generating installation with a net capacity of over 1 MW or obtain direct possession of such an installation;

3) acquire a direct line or a direct current line crossing the national border or a personal right to use one;

4) acquire shares in a network operator, a line possessor or a producer who is in possession of generating installations with a net capacity of over 1 MW, as a result of which the person holds at least 50 per cent of the votes represented by shares at the general meeting of shareholders of the company, or if the person acquires control, by any other means, over a network operator, line possessor or a producer who is in possession of generating installations with a net capacity of over 1 MW;

(2) The notification mentioned in subsection 1 of this section is transmitted within ten days following conclusion of the contract under which the person acquires the right or property mentioned in subsection 1, or their direct use or possession. Where such a right or property is acquired, or their direct use or possession commences prior to conclusion of a corresponding contract or without such a contract, notification is made within ten days following the acquisition or commencement of direct possession or use. The following information is included the notification:

1) the location and description of the network, line or generating installation, including the net capacity of and energy sources used by the generating installation;

2) the name of the network operator, line possessor or producer mentioned in clause 4 of subsection 1 of this section and its registration number in the Commercial Register;

3) the name, personal identification code or registration number in the Commercial Register, and contact details of the person who acquired the network, line or generating installation or of the person who has acquired a personal right to use the same or entered into direct possession of the same or of the person who has acquired control or shares of the same;

4) the legal basis for and material circumstances relating to the acquisition of the network, line or generating installation or of acquiring a personal right to use the same or of entry into direct possession of the same, or of the acquisition of control or shares of the same;

5) any substantial changes in the business forecast.

(4) The transmission network operator must inform the Competition Authority of every planned transaction which may give rise to the need to review the operator’s conformity to the requirements listed in § 18¹of this Act. The transmission network operator must also, without delay, inform the Competition Authority of any circumstances that make it possible for a citizen of a country other than a member state of the European Union (hereinafter ‘third country’) or a legal person incorporated and registered in such a country to acquire control of the operator.

(5) An electricity undertaking presents, to the Competition Authority, the particulars of any investment projects mentioned in clause 3 of the Annex to Regulation (EU) No 256/2014 of the European Parliament and of the Council concerning the notification to the Commission of investment projects in energy infrastructure within the European Union, replacing Council Regulation (EU, Euratom) No 617/2010 and repealing Council Regulation (EC) No 736/96 (OJ L 84, 20.03.2014, pp. 61–68),

§ 20. Guarantees of balance provider

(1) A balance provider provides the system operator with bank guarantees which meet the requirements provided by the network code on the functioning of the electricity market and which secure unconditional performance of all the obligations of the balance provider in respect of the system operator. Such guarantees are permanent guarantees and variable guarantees.

(2) A balance provider provides a permanent guarantee in the amount prescribed in the network code on the functioning of the electricity market.

(3) A balance provider provides a variable guarantee in the amount equal to the amount payable for the balancing electricity purchased by the balance provider over a period of time equal to one and a half times the period which is provided by the network code on the functioning of the electricity market as the base period for money transactions related to the balance (hereinafter, ‘transaction period’) and which precedes the provision of the variable guarantee or decision on amending the guarantee, less the amount payable for balancing electricity purchased from the balance provider over the same period of time.

(4) If it is not possible to determine the amount of a variable guarantee according to the method mentioned in subsection 3 of this section, the system operator determines the amount of the variable guarantee based on the amount payable for the balancing electricity likely to be purchased by the balance provider over a period of time equal to one and half times the transaction period, less the amount payable for the balancing electricity likely to be purchased from the balance provider over the same period of time, and taking into account the economic reliability of the balance provider.

(5) The system operator determines the amount of the variable guarantee to be provided by a balance provider and, if necessary, modifies that amount according to the provisions of subsections 2–4 and 6 of this section.

(6) Where this is requested by the balance provider, the system operator reduces the amount of the variable guarantee if the amount to be determined under subsection 3 or 4 of this section would, at the moment of reduction, be significantly lower than the amount last determined as the amount of the balance provider’s variable guarantee. The system operator increases the amount of a variable guarantee if the amount to be determined under subsection 3 or 4 of this section would, at the moment of increase, be significantly greater than the amount last determined as the amount of the balance provider’s variable guarantee.

(7) A balance provider maintains any permanent or variable guarantee as valid for the amount prescribed in the network code on the functioning of the electricity market or determined by the system operator in accordance with this Act.

(8) Detailed conditions for the provision of permanent and variable guarantees and for the determination of and making changes to guarantee amounts are prescribed in the network code on the functioning of the electricity market.

§ 21. Other requirements for balance providers

(1) A balance provider must possess means of communication which meet the requirements established in the network code on the functioning of the electricity market.

(2) A balance provider concludes a balance agreement with the system operator.

§ 21². Requirements to ensure operational continuity of services of vital importance

(1) A producer who provides a service of vital importance within the meaning of clause 1 of § 21¹of this Act must ensure the performance on their premises of rescue operations required for operational continuity of the service and must ensure that a rescue unit required for such operations is available.

(2) For the purposes of this Act, rescue operations required for the operational continuity of the service means rescue operations that are unavoidable and urgent and that are carried out without delay on the producer’s premises upon the occurrence of a rescue event until the arrival of the rescue authorities.

(3) Requirements for rescue units performing rescue operations mentioned in subsection 1 of this section and the rules for cooperation with the rescue authorities are enacted by a regulation of the minister in charge of the policy sector.

§ 21³. Provider of a service of general interest

A network operator who engages in activities that require an authorisation is deemed provider of a service of general interest within the meaning of the General Part of the Code of Economic Activities Act.

§ 21⁴. Demand response through aggregation

(1) When procuring flexibility and ancillary services, a network operator allows the participation of an aggregator in demand response.

(2) An aggregator has balance responsibility. Within the scope of its balance responsibility, an aggregator is a balance provider, except where it delegates its balance responsibility in accordance with Article 5 of Regulation (EU) 2019/943 of the European Parliament and of the Council.

(3) The Competition Authority elaborates conditions for participation in demand response, conducts public consultation with market participants, obtains approval of the conditions from the Competition Authority and publishes the conditions on its website. Elaboration of the conditions is based on this Act, the network code on the functioning of the electricity market, Regulation (EU) 2019/943 of the European Parliament and of the Council and implementing acts enacted under Article 59 of that regulation.

(4) Based on the conditions for participation in demand response mentioned in subsection 3 of this section, network operators elaborate the required methodologies and file these with the Competition Authority. The Authority may require amendment of the methodology.

(5) The conditions for participation in demand response mentioned in subsection 3 of this section allow for aggregation of the demand response and operation of independent operators by using the following electricity market mechanisms:

1) day-ahead electricity market;

2) intraday electricity market;

3) balancing market.

(6) Specific rights and obligations related to participation in demand response on the electricity market are enacted by the minister in charge of the policy sector in the network code on the functioning of the electricity market.

§ 22. Requirement to hold a relevant authorisation

(1) An undertaking must hold a relevant authorisation to engage in the following activities:

1) the generation of electricity;

2) the provision of network services through a distribution network;

3) the provision of network services through the transmission network;

4) ;

5) conveying electricity via a direct current line crossing the national border;

6) conveying electricity via a direct line or via direct lines.

(2) The obligation provided by subsection 1 of this section does not apply in the following situations:

1) when electricity is generated by a generating installation which has a net capacity of up to 1 MW;

2) when electricity is conveyed in accordance with clauses 1 or 2 of subsection 6 of § 15 of this Act, or via a closed distribution network;

3) ;

4) ;

5) ;

6) when electricity is generated in accordance with subsection 3 of § 16 of this Act;

7) when electricity is conveyed via a direct line, provided the direct line is connected to a generating installation whose net capacity is up to 1 MW.

(3) A generating installation that uses nuclear energy may be employed for the generation of electricity provided this is authorised by a resolution of the Riigikogu.

(4) The authorisation to provide network services through the transmission network is granted to one undertaking only.

(5) An undertaking that pursues the activity mentioned in clause 2 or 3 of subsection 1 of this section has a right, on conditions provided by law, to construct, in the service area stated in the authorisation, correspondingly either the distribution or transmission network and to use that network in that area for the provision of network services.

§ 22¹. Obligation to notify

(1) In order to operate as a seller of electricity, an undertaking must present a notice of economic activities to the Register of Economic Activities in accordance with the rules provided by the General Part of the Economic Activities Code Act.

(2) The obligation to notify does not apply in the following situations:

1) when selling electricity in accordance with clause 1 or 2 of subsection 6 of § 15 of this Act;

2) when selling electricity generated by the producer;

3) when selling electricity on the power exchange;

4) when selling electricity in accordance with subsection 3 of § 16 of this Act;

5) when selling electricity, provided the distribution network operator only provides, to the market participant, the service of open supply in accordance with subsection 4¹ of § 44, or the universal service in accordance with § 76¹ of this Act;

6) when selling electricity, provided the electricity has been conveyed to the consumer via a direct line and generated by generating installations which have a total net capacity of less than 1 MW.

§ 23. Applying for the authorisation

(1) Applications for the authorisation are decided on by the Competition Authority within 60 days, except for applications for the authorisation to provide network services through the transmission network, which are to be decided on within 10 months.

(2) In addition to the particulars and documents required by virtue of the General Part of the Code of Economic Activities Act, the following are to be annexed to the application for authorisation:

1) where network services are to be provided through a distribution network, the definition and schematic layout of the service area conforming to the provisions of § 62 of this Act;

2) where electricity is to be conveyed via a direct current line or direct line crossing the national border, the maximum rated operating voltage of the line, the length of the line, the schematic layout of the line and its geographical coordinates;

3) where electricity is to be conveyed via a direct, the document that certifies conformity to the condition mentioned in § 61 of this Act.

§ 26. Scope of scrutiny for an authorisation

(1) An authorisation is issued to the undertaking if it meets the requirements established in § 15 of this Act.

(2) An authorisation for the provision of network service through a distribution network is issued to an undertaking if that undertaking, in addition to the provisions of § 15 and subsections 1–1⁴ and 4–7 of § 18 of this Act also fulfils the following requirements:

1) the organisation of the undertaking is suitable considering the extent and nature of the activity applied for;

2) the undertaking employs a sufficient number of staff with the necessary qualifications, including persons qualified to perform electrical work[ML1] and to supervise electrical installations;

4) the undertaking possesses commercial prerequisites for operating in the area of activity applied for;

5) the undertaking possesses other prerequisites necessary for operating in the corresponding area of activity in accordance with this Act and the legislation enacted under it;

6) the actions of the undertaking do not jeopardise the security of supply.

(3) An authorisation for the provision of network services through a distribution network is to be issued if this is not in conflict with the provisions of subsections 1 and 2 of this section and with § 60 of this Act and provided that the geographical area stated in the application is suitable for the distribution of electricity.

(4) An authorisation for providing network services through the transmission network is issued to the person who owns the transmission network, meets the requirements provided by § 18¹ of this Act and complies with the conditions provided under subsection 2 of this section.

(5) An authorisation for the provision of network services through the transmission network is only issued to one network operator.

(6) An authorisation for conveying electricity via a direct line is issued to the undertaking if the issuing of the authorisation is in conformity with the provisions of § 60 and 61 of this Act.

(7) An authorisation to convey electricity via a direct current line that crosses the national border is issued to the person if that person meets the requirements provided by subsection 2 of § 15 and in § 18¹ of this Act, provided the issuing of the authorisation is in conformity with §§ 60 and 61.

§ 26¹. Assessment of compliance with established requirements of transmission network operator and of possessor of a direct current line crossing the national border

(1) The Competition Authority assesses compliance of the transmission network operator with the requirements established in § 18¹ of this Act in accordance with this section and Article 51 of Regulation (EU) 2019/943 of the European Parliament and of the Council.

(2) The Competition Authority initiates an assessment of compliance with established requirements in respect of the transmission network operator if the person applies for the authorisation mentioned in clause 3 of subsection 1 of § 22 of this Act.

(3) The Competition Authority prepares a draft decision regarding assessment of compliance with the requirements within four months following receipt of an application for authorisation and, without delay, transmits such a decision together with the relevant information to the European Commission in order to obtain the latter’s opinion.

(3¹) If the authorisation mentioned in clause 3 of subsection 1 of § 22 of this Act is applied for by a transmission network owner or transmission network operator who is controlled by a person from a third country, the Competition Authority, prior to making the assessment decision, requests the opinion of the European Commission on whether the person complies with the requirements provided by in § 18¹ of this Act and whether certifying that the person complies with the requirements jeopardises the security of supply of the European Union.

(4) The Competition Authority makes a decision regarding the assessment of compliance with established requirements within two months following receipt of the opinion of the European Commission or within four months after the Commission’s opinion was requested. When making its decision, the Competition Authority takes the Commission’s opinion into account to the greatest extent possible.

(5) If the Competition Authority has not made a decision regarding assessment of compliance with established requirements within the time-limit provided by subsection 4 of this section, the transmission network operator is deemed to comply with the requirements provided by § 18¹ of this Act and the authorisation mentioned at clause 3 of subsection 1 of § 22 of this Act is deemed to have been issued.

(6) The Competition Authority assesses compliance with the requirements provided by § 18¹ of this Act of the possessor of a direct current line that crosses the national border and that has a connection to the network of another country, following the provisions that govern the assessment of compliance with requirements of the transmission network operator.

§ 29. Special rules regarding refusal to issue the authorisation

Where the Competition Authority refuses to issue the authorisation for the activity mentioned in clause 1 of subsection 1 of § 22 of this Act, it transmits a notice to that effect to the European Commission. The notice states the reasons for the refusal.

§ 32. Ancillary conditions of the authorisation

(1) The following ancillary conditions are included in the authorisation for the production of electricity:

1) the maximum rated net capacity of the generating installation;

2) location data in respect of the generating installation;

3) data concerning the energy source used to operate the generating installation;

4) information concerning whether the electricity generated under the authorisation may be sold using the support mentioned in § 59 of this Act;

5) where the electricity generated under the authorisation may be sold using the support mentioned in § 59 of this Act, the list of requirements applicable to the generation of electricity from a renewable source and to the generating installations used for that purpose;

6) a description of the installations that may be used to generate and sell electricity when using the support mentioned in § 59 of this Act.

(2) The following ancillary conditions are included in the authorisation for the provision of network services through the distribution or transmission network:

1) the highest rated operating voltage of the network;

2) the technical, economic and organisational requirements that the network operator must meet;

3) in relation to the provision of network services through a distribution network, information concerning the service area assigned in accordance with § 62 of this Act.

(3) The following ancillary conditions are included in the authorisation for the transmission of electricity via a direct current line crossing the national border or via a direct line:

1) the highest rated operating voltage of the network;

2) the geographical coordinates of the line and the length of the line.

(4) The following ancillary conditions may be included in the authorisation:

1) the requirement to provide a security approved by the Competition Authority to cover the cost of resiting the network and the electrical installations connected to the network or to cover the cost of implementation of measures to rebuild the network and the electrical installations connected to the network;

2) a development obligation conforming to § 66 of this Act.

§ 33. Modification of authorisation and establishment of new ancillary conditions

(1) In addition to the grounds provided by the General Part of the Code of Economic Activities Act, the Competition Authority may, in observance of the General Part of the Code of Economic Activities Act, this Act and the principles of equal treatment and free competition, of its own motion modify the authorisation or establish ancillary conditions thereto, provided this is necessary in order to reflect a legislative amendment, to ensure the security of supply, or to ensure compliance with an obligation emanating from this Act or from the legislation made under it.

(2) When modifying the authorisation or establishing a new ancillary condition, the Competition Authority gives the holder of the authorisation at least 90 days’ advance notice in writing.

(3) Where delaying the modification of the authorisation or the establishment of a new ancillary condition may jeopardise the security of supply, the Competition Authority is not required to observe subsection 2 of this section or the rules provided by the General Part of the Code of Economic Activities Act.

§ 38. System responsibility and system operator

(1) System responsibility means the obligation to ensure the security of supply and balance of the system at any moment in time.

(2) System responsibility lies on the system operator. The system operator is the operator of the transmission network.

(3) The system operator exercises the rights and performs the obligations arising from this Chapter in accordance with the principle of equal treatment.

§ 39. Obligations of system operator

(1) In order to perform the obligation provided by § 38 of this Act, the system operator:

1) ensures the security of supply of the system in accordance with the network code on the functioning of the power system;

1¹) ensures the availability, in accordance with the requirements laid down by this Act and by legislation enacted under it, of the generation capacity required for island operation of the electricity system;

2) formulates an annual action plan to ensure the security of supply for the following year and, if necessary, modifies that plan;

3) plans and manages generation in the system, the transmission of electricity in the transmission network and the consumption of electricity, taking account of the technical parameters of the system;

3¹) based on the principles of congestion management provided by Regulation (EU) 2019/943 of the European Parliament and of the Council and in Regulation (EU) 2015/1222 of the Commission, formulates the principles for intra-hour regulation of the system, the plan for the allocation of cross-border capacities and the principles of congestion management and publishes these on its website after having obtained the approval of the Competition Authority;

4) ensures interoperability with neighbouring systems in real time, taking into account the technical parameters of such systems;

5) prepares and brings into effect action plans for network operators for the restoration of electricity supply and monitors implementation of such plans;

6) organises the restoration of electricity supply in accordance with the action plans mentioned in clause 5 of this subsection;

7) settles the balance of the system and of the balance provider based on information communicated to the system operator, and purchases regulating capacity and balancing electricity, and sells balancing electricity, in order to ensure effective functioning of the electricity market and a fair allocation of the costs incurred in maintaining the balance of the system among the balance providers in accordance with this Act, the legislation enacted under it as well as with the agreements entered into with balance providers;

8) verifies whether the balance providers meet the requirements provided by this Act and the network code on the functioning of the electricity market;

9) requires balance providers to provide a bank guarantee in accordance with this Act and the network code on the functioning of the electricity market and check whether the guarantee meets the requirements;

10) enters into balance agreements with balance providers;

11) based on data relating to balance settlement and other relevant data, presents invoices to the balance provider for each transaction period regarding the charges payable for the balancing electricity purchased by the balance provider and any other charges payable to the system operator by virtue of legislation or the corresponding agreement and collects the sums payable by the balance provider under the invoice;

12) based on data relating to balance settlement and other relevant data, calculates the amounts of balancing electricity sold by a balance provider to the system operator during each transaction period and pays the balance provider for such amounts;

13) in situations mentioned in § 20 of this Act, requires the balance provider to increase the amount, or authorises a reduction, of the guarantee;

14) makes proposals to the minister in charge of the policy sector regarding amendment of the regulations enacted under § 42 of this Act;

15) regularly informs the public of development trends of the system;

15¹) provides information to the network operator whose network is connected to the network of the system operator in order to ensure the safe and effective functioning of the system, its coordinated development and the interoperability of the joint system;

16) at the request of a market participant who intends to import electricity, issues a notice to such a participant stating its opinion on whether the planned import is permissible from the point of view of technical parameters of the system and whether such import would prejudice the security of supply and, where this is needed, establishes requirements for the import of electricity based on technical parameters of the system;

16¹) participates in assessing the adequacy of European resources in accordance with Chapter IV of Regulation (EU) 2019/943 of the European Parliament and of the Council;

16²) provides an assessment of the adequacy of national resources in accordance with Article 24 of Regulation (EU) 2019/943 of the European Parliament and of the Council;

17) performs other functions arising from this Act or from a regulation enacted under § 42 of the same.

(2) When the system operator issues the order mentioned in subsection 2 of § 40 of this Act to a producer who has not entered into a production capacity adjustment agreement with the system operator, or reduces or increases generation on the grounds mentioned in subsection 2 of § 40 of this Act, and this causes the producer or balance provider to incur costs, the system operator subsequently reimburses the producer or balance provider within a reasonable time for the costs which are justified and documented and which the producer would not have incurred if the system operator had not issued the order or had not increased or reduced generation.

(2¹) Financial compensation is paid when redispatching is used in accordance with paragraph 7 of Article 13 of Regulation (EU) 2019/943 of the European Parliament and of the Council, provided it is prescribed based on the methodology mentioned in subsection 2² of this section. In a situation where generation is reduced, the system operator and the distribution network operator do not pay financial compensation to the producer if the order to reduce generation which the system operator gave to the producer was issued on the grounds mentioned in subsection 2 of § 40 of this Act and if all other options had been exhausted.

(2²) The system operator elaborates a methodology for compensating for the redispatching of generation and, before enacting it, presents it to market participants for public consultation.

(3) The system operator may not disclose information obtained in the course of performing its duties to any third parties. This does not apply in situations where the disclosure of information is prescribed by law or where information is to be disclosed for the performance of obligations arising from this Act.

(4) The system operator is independent in its activities. The system operator observes the principle of equal treatment with regard to all market participants with the aim of achieving the best economic results for the whole system within the framework of existing technical requirements and requirements for the security of supply as well as other requirements arising from applicable legislation.

(5) When this is required by the Competition Authority, the system operator files, separately, the allocation of revenues and expenditures related to maintaining and determining the balance of the system and for any other activities.

(6) When elaborating standard terms and conditions for balance agreements and setting the price of balancing electricity, the system operator follows the principles of equal treatment and transparency.

(7) The system operator compiles, and files with the European Commission, the Ministry of Climate and the Competition Authority a report which describes:

1) estimated supply and demand of electricity during the next five years;

2) the existing supply potential;

3) generating installations envisaged or under construction;

4) the quality and level of maintenance of networks;

5) the measures to cover the estimated maximum demand (peak demand) and the measures to be implemented in the event of shortfalls of capacity;

6) operational security of the network;

7) a forecast of the situation in relation to the security of electricity supply for ten years from the filing date of the report;

8) the investment plans of the distribution network operator and the known relevant investment plans of neighbouring countries concerning the establishment of cross-border interconnectors for the following five calendar years, taking into account the need to maintain trade secrets.

(8) The investment plan mentioned in clause 8 of subsection 7 of this section describes:

1) principles of congestion management provided by Regulation (EU) 2019/943 of the European Parliament and of the Council;

2) existing and envisaged transmission lines;

3) estimated patterns of generation, storage and transmission of electricity, of cross-border exchanges in electricity and of consumption of electricity which make it possible to implement load management measures;

4) objectives of sustainable development at regional, national and European level, including projects which are part of the priority projects provided by Annex 1 to Decision No 1229/2003/EC of the European Parliament and of the Council of laying down a series of guidelines for trans-European energy networks and repealing Decision No 1254/96/EC (OJ L 176, 15.7.2003, pp. 11–28).

(9) Where this is needed, the system operator creates, and operates, a comparison tool that meets the requirements provided by subsection 3 of § 82¹ of this Act.

§ 39¹. Security of supply of micro isolated networks

The network operator in whose service area the micro isolated network is located ensures the security of supply and the balance of that network in accordance with this Act and the grid code.

§ 40. Rights of system operator

(1) In order to perform the obligation prescribed in § 38 of this Act and other obligations prescribed in this Act, the system operator requires producers to increase or reduce generation or consumers to reduce consumption or, in accordance with contracts entered into for the purchase of regulating capacity, itself increases or reduces generation or consumption.

(2) To perform the obligation prescribed by § 38 of this Act and other obligations prescribed by this Act, the system operator may issue mandatory orders to producers to increase or reduce generation, and may issue mandatory orders to consumers to reduce consumption and may, by its own decision, increase or reduce generation or consumption, regardless of whether a contract has been entered into with the system operator for the purchase of regulating capacity, provided that the issue of such orders or the increase or reduction of generation or consumption is necessary for technical reasons or in order to ensure the security of supply.

(3) The system operator may issue mandatory orders to other network operators and consumers for the restriction or interruption of the supply of electricity to consumers and may, by its own decision, restrict or interrupt consumption in accordance with the action plan formulated under clause 5 of subsection 1 of § 39 of this Act, provided that this is necessary for the system operator to perform the obligation prescribed in § 38 or other obligations prescribed in this Act. The specific rules for the restriction and interruption of electricity supply mentioned in this subsection and the obligations of network operators and consumers in relation to such restriction or interruption of supply are provided by the network code on the functioning of the power system.

(4) When purchasing the electricity and regulating capacity necessary to perform its obligations and when using other relevant services, the system operator observes free market principles, acts with regard to all market participants in accordance with the principles of equal treatment and transparency, and avoids establishing unreasonable restrictions.

(5) In order to perform its duties, the system operator may establish justified technical restrictions for use of the system and may require that, in order to ensure the technical interoperability and security of supply of the system, producers and network operators conclude cooperation agreements under reasonable conditions that conform to the principle of equal treatment.

(6) The system operator may require that market participants and local authorities provide it with information that it needs for the performance of its obligations.

(7) Any payments made and costs reimbursed under subsection 2 of § 39 of this Act and any other justified costs incurred by the system operator in performing the obligations provided by this Act and the legislation enacted under it are deemed to be justified costs incurred by the transmission network operator and such costs are added to the costs based on which the transmission network operator sets and applies for the approval of, the charges payable for the transmission of electricity.

§ 40¹. Perimeter fee

In accordance with Regulation (EU) 2019/943 of the European Parliament and of the Council, the system operator pays a perimeter fee to the fund created by the inter-transmission system operator compensation mechanism for electricity transit. Perimeter fees are charged on those electricity flows which originate from or end in a country which has not joined the aforementioned compensation mechanism. The rate of the perimeter fee is determined each year in an agreement between the system operators which forms part of the compensation mechanism.

§ 41. Liability of system operator

(1) The system operator compensates the harm caused to third parties in the course of performing its obligations only if that harm is direct and arose through the fault of the system operator.

(2) The system operator will not compensate any harm arising from or reimburse any cost or the loss of any profit incurred in the course of the performance of orders mentioned in subsections 2 and 3 of § 40 of this Act or as a result of restrictions imposed following subsection 5 of § 40 of this Act, except for payment of charges or reimbursement of costs to producers or balance providers in accordance with subsections 2 and 2¹ of § 39 of this Act.

§ 42. Grid code, network code on the functioning of the power system and network code on the functioning of the electricity market

(1) The following are provided by the grid code:

1) ;

2) technical requirements for electrical installations which are dictated by the security of supply;

2¹) simplified conditions for connecting to the network a generating installation which has a capacity of less than 15 kW and which uses a renewable source;

6) other conditions prescribed by law.

(2) The grid code is enacted by the Government of the Republic.

(3) The Government of the Republic enacts, by means of a regulation, the network code on the functioning of the power system, which provides the following:

1) requirements applicable in respect of the security of supply;

2) technical requirements for electrical installations which are dictated by the security of supply;

3) the rules for restricting or interrupting the supply of electricity and the obligations of the network operators and of consumers in relation to the restriction or interruption of the supply of electricity;

4) technical and metrological requirements for measurements and for measuring equipment;

5) the rules for connection to the network and for amendment of the consumption or generation conditions;

6) the rules governing the calculation of charges payable to the network operator for connection to the network and for amendment of the consumption or generation conditions;

7) conditions for technical cooperation between the transmission network operator and the relevant network operators of neighbouring countries;

8) technical requirements for ensuring island operation of the electricity system;

9) rights and obligations related to conditions of participation in demand response;

10) data validation as well as technical and metrology requirements for special metering devices.

(4) The minister in charge of the policy sector enacts, by means of a regulation, the network code on the functioning of the electricity market, which provides the following:

1) the requirements and rules for switching to another seller or aggregator;

2) the requirements concerning data exchange between market participants;

3) the rights and obligations related to balance responsibility;

4) the conditions for determining the permanent and variable guarantee of the balance provider;

5) the terms and conditions for the sale of electricity in the event of an interruption in an open supply chain;

6) the rules for set-offs of the price of the universal service, for data exchange related to such service and for provision of information to small consumers;

7) data which the seller must transmit to the operator of a comparison tool that was created by the system operator and that has been issued a trust mark;

8) the rules for auctions of recharging points, a set of recharging points or of energy storage units.

§ 42¹. Data exchange in electricity market

(1) The data exchange platform is a digital environment for data exchange in the electricity market for the purpose of switching open suppliers or aggregators, transmitting and receiving metering data, performing the obligations imposed on market participants by the law and ensuring the rights granted to them.

(2) In order for the electricity market to function and to facilitate competition, the system operator creates a data exchange platform and administrates it such that market participants, who are subject to a legal obligation and at the same time enjoy a legal right to file information, have the opportunity to do so in time, as well as the opportunity to obtain information in a timely manner and on equal terms. No additional fee is charged for the filing and retrieval of such information.

(3) Electricity undertakings transmit the following information to the data exchange platform:

1) identifier of the market participant as established in the network code on the functioning of the electricity market;

2) identifier of the metering point as established in the network code on the functioning of the electricity market;

3) information regarding the metering point as established in the network code on the functioning of the electricity market;

4) metering or consumption data by metering point and net-metered metering data for the trading period and by metering point;

4¹) metering data metered by special metering device in accordance with clause 4 of subsection 10 of § 59² of this Act;

5) information regarding the period of the network and electricity contract and of the aggregation contract of the market participant;

6) information regarding the open supplier and aggregator of the metering point as established in the network code on the functioning of the electricity market;

7) other information, as established in the network code on the functioning of the electricity market, which is required in order to achieve the objectives mentioned in subsection 1 of this section.

(4) The rules for the filing of information are established in the network code on the functioning of the electricity market.

(5) Transmission of personalised data via the data exchange platform to a seller, aggregator or energy service provider with whom a natural person consumer has not concluded a contract requires the consent of that consumer. This consent must meet the conditions provided by Regulation (EU) 2016/679 of the European Parliament and of the Council on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 04.05.2016, pp. 1−88).

(5¹) The system operator may use, for energy statistics elaboration purposes, any data that have been transmitted to the data exchange platform, and to publish such statistics in the public interest. Energy statistics are anonymous.

(6) The data transmitted to the data exchange platform are preserved for twelve years and are then deleted.

(7) The system operator publishes on its website technical instructions for using and joining the data exchange platform.

§ 42². Preparing to apply a capacity mechanism

(1) Where, in the assessment of the system operator, the reliability standard mentioned in the network code on the functioning of the power system has not been met – even in one year of the following ten-year period – the operator, without delay, makes a proposal to the minister in charge of the policy sector to apply a capacity mechanism (hereinafter, also ‘the mechanism’) on conditions, and according to the rules, provided by Regulation (EU) 2019/943 of the European Parliament and of the Council. The proposal states the period of time during which there are problems meeting the standard and for how long the mechanism should be applied.

(2) Preparing to apply the mechanism, the system operator develops a plan to carry it out (hereinafter in this Chapter, ‘the mechanism plan’), which includes a description of the type of mechanism envisaged in order to ensure the ability of the power system.

(3) The system operator conducts a public consultation with market participants on the structure of the mechanism as presented in the mechanism plan, and on potential impact of the mechanism on the Estonian electricity market. The mechanism plan on which public consultation has been completed is presented by the system operator at the first opportunity to the Competition Authority and to the minister in charge of the policy sector, both of whom may require – with justifications – that the plan be changed.

(4) Based on the mechanism plan developed in accordance with subsection 3 of this section, the system operator, following paragraph 2 of Article 21 of Regulation 2019/943 of the European Parliament and of the Council, conducts an additional study in the course of which the mechanism’s impact on neighbouring member states is analysed, consulting with at least those of such states with which there is a direct network connection, and with the stakeholders of those states.

(5) When the Competition Authority receives the system operator’s proposal that is mentioned in subsection 1 of this section and that seeks to apply the mechanism, it develops – based on principles provided by paragraph 3 of Article 20 of Regulation 2019/943 of the European Parliament and of the Council – an implementation plan proposal that includes an analysis of regulatory distortions and market failures and, at the first opportunity, presents it to the minister in charge of the policy sector.

(6) The minister in charge of the policy sector presents, to the European Commission for approval, an implementation plan that has been provided for by paragraph 3 of Article 20 of Regulation 2019/943 of the European Parliament and of the Council and that has been drawn up based on the analysis in the implementation plan proposal, as well as the mechanism plan.

§ 42³. Applying the capacity mechanism

(1) The mechanism is not applied before reception, from the European Commission, of the approval mentioned in subsection 6 of § 42²of this Act.

(2) Where, on application of the mechanism, state aid is granted to the winner of the reverse auction mentioned in subsection 3 of this section, the European Commission’s guidelines for state aid on climate, environmental protection and energy, and the Commission’s relevant decision allowing the grant of state aid, are followed.

(3) The reverse auction for the mechanism, and its application, are arranged by the system operator in accordance with the decision mentioned in subsection 2 of this section and with Article 22 of Regulation 2019/943 of the European Parliament and of the Council. The system operator presents the terms and conditions of reverse auction ahead of time to market participants during public consultation. The system operator presents the terms and conditions on which public consultation has been completed to the Competition Authority, which may require – with justifications – that these be changed.

(4) Any costs included in the price of the offer participating in the reverse auction for the mechanism must be justified, be based on cost efficiency and allow the undertaking to comply with obligations provided by legislative instruments. Prices must be set such that they allow, on a continuous basis:

1) to cover necessary variable and operating costs;

2) to comply with environmental requirements;

3) to comply with quality and safety requirements;

4) a justified return on the capital invested by the undertaking.

(5) The rules for the reverse auction held to apply the mechanism are enacted by a regulation of the minister in charge of the policy sector based on guidelines mentioned in subsection 2 of this section.

(6) The system operator publishes, on its website, the decision mentioned in subsection 2 of this section and the conditions for the reverse auction together with the rules mentioned in subsection 5 of this section. At least three months before the start of the reverse auction, the system operator publishes, on its website, a notice announcing the time of holding the reverse auction and of the terms and conditions of the auction.

(7) When the application period of the mechanism ends, the need to apply it is no longer present or where no new contracts to procure the mechanism have been concluded for three consecutive years, the system operator terminates applying the mechanism in accordance with Article 21 of Regulation (EU) 2019/943 of the European Parliament and of the Council, and with the decision mentioned in subsection 2 of this section.

§ 42⁴. Funding the application of capacity mechanism

(1) The cost of funding the mechanism applied under §§ 42² and 42³ of this Act is borne by consumers proportionately to their consumption of network service and to the quantity of electricity consumed via a direct line.

(2) Within 30 days following conclusion of the contract with the winner of the reverse auction held on the basis of subsection 3 of § 42³ of this Act – and for the duration of application of the mechanism – the system operator publishes the results of the auction on its website. By 1 December of each year, the system operator completes an assessment of the extent of the amount of funding for the mechanism in the following year, of the volume of network services provided to consumers and of the quantity of electricity consumed via direct lines. Where this is justified, the system operator may amend the assessment – and the cost of funding the mechanism – twice a year, at the latest by 1 June and 1 December.

(3) Where the system operator has required this, the network operator and the possessor of a direct line present it, within a reasonable time, with an assessment of the volume of network services to be provided by them and the quantity of electricity to be consumed via a direct line.

(4) Based on the assessment of the cost of funding the mechanism mentioned in subsection 2 of this section, the system operator, by 1 December, sets the cost of funding – in euros per each kilowatt-hour of electricity consumed via network service and via a direct line – while taking into account any amounts by which receipts during the 12 months immediately preceding completion of the assessment overshot or fell below the funding required for the mechanism. The system operator publishes, on its website, the cost for the following year together with data based on which it was calculated, and with the sequence of calculations that were performed.

(5) In the invoice that is issued to the consumer by the network operator for network services and by the possessor of a direct line for electricity consumed via that line, the operator or the possessor states, as a separate item, the cost of funding the capacity mechanism.

(6) By the fifth day of each month, the network operator and the possessor of a direct line present, to the system operator, data concerning the volume of network services provided and the quantity of electricity consumed via the direct line.

(7) Based on data mentioned in subsection 6 of this section, the system operator issues, by the seventh day of each month, an invoice to the network operator and to the possessor of the direct line for the cost of funding the mechanism, whose amount is paid to the system operator by the 21st day of each month regardless of whether consumers have paid the cost based on invoices issued to them.

(8) Where data mentioned in subsection 6 of this section are not presented by the due date, the system operator issues the invoice based on the network operator’s or line possessor’s assessment mentioned in subsection 3 of this section. Once precise data have been ascertained, the system operator performs a set-off in the invoice for the following month.

§ 42⁵. Ensuring availability of generation capacity in situations of island operation

(1) The system operator regularly assesses Estonia’s island operation capability in accordance with the methodology of calculating the demand for generation capacity required for island operation.

(2) Where, according to the assessment of the system operator, a risk of insufficiency, according to the requirements of the regulation enacted under subsection 3 of § 42 of this Act, of generation capacity in the event of island operation, the system operator, without delay, notifies the minister in charge of the policy sector and the Competition Authority of the intention to procure the service of ensuring island operation capability. The notification states the time period during which there are problems with availability of generation capacity, the extent of the service to be procured and the estimated cost of the public procurement.

(3) The aim of the service of ensuring island operation capability is to ensure stable operation of Estonia’s electricity system and availability of generation capacity during periods of maximum load in situations of island operation.

(4) Procurement of the service of ensuring island operation capability is subject to subsections 2 and 3 of § 66³ of this Act.

(5) The principles of procuring the service of ensuring island operation capability that are mentioned in subsection 3 of § 66³ of this Act and that are to be approved by the Competition Authority must contain at least:

1) a technical description of the service;

2) a methodology for calculating the capacity demand required for island operation;

3) terms of the procurement contract regarding legal remedies in the event the producer violates the requirements provided by subsection 2 of § 42 of this Act;

4) rules for carrying out the compliance audit mentioned in subsection 5 of § 42⁶ of this Act, and the requirements to be met by the independent auditor.

(6) The service of ensuring island operation capability is not used concurrently with application of the capacity mechanism mentioned in subsection 1 of § 42² of this Act, provided the latter is designed as a strategic reserve in accordance with paragraphs 1 and 2 of Article 22 of Regulation (EU) 2019/943 of the European Parliament and of the Council.

§ 42⁶. Providing the service of ensuring island operation capability

(1) A producer who provides the service of ensuring island operation capability must have constituted sufficient stocks of fuel for the duration of the procurement contract or must have ensured technical readiness in other respects, and must ensure that the service is provided efficiently, safely and reliably and in accordance with the requirements established by the regulation enacted under subsection 3 of § 42 of this Act.

(2) The price of the service of ensuring island operation capability must be set such that it ensures, on a continuous basis:

1) the covering of the producer’s necessary variable and operating costs, taking into account revenue from other relevant economic activities;

2) observance of environmental requirements;

3) observance of quality and safety requirements;

4) a justified return on invested capital.

(3) The basis for calculating the justified return on invested capital mentioned in clause 4 of subsection 2 of this section is the percentage of the price of invested capital directly required for the provision of the undertaking’s service and of weighted average capital, which is provided by the regulation enacted under subsection 4 and which may not exceed 12 in the case of renewable energy technologies and 14 in the case of other technologies.

(4) The specific price of invested capital and of weighted average capital is enacted by the Government of the Republic in the regulation mentioned in subsection 3 of § 42 of this Act.

(5) The system operator is entitled to commission an independent auditor to carry out a compliance audit to verify whether the producer has set the price of the service of ensuring island operation capability in accordance with the requirements provided by subsection 2 of this section. The compliance audit and the independent auditor must meet the requirements enacted under clause 4 of subsection 5 of § 42⁵ of this Act. The person carrying out the audit presents it to the system operator, who covers the cost of carrying out the audit.

§ 42⁷. Funding the service of ensuring island operation capability

(1) Within 30 days following conclusion of the contract with the winning bidder, the system operator publishes on its website the results of the public procurement procedure conducted on the basis of subsection 4 of § 42⁵ of this Act, and continues the publication during the period that the system operator procures the service. By 1 December of each year, the system operator publishes, for the next calendar year, an assessment of the estimated cost of the service of ensuring island operation capability, the volume of network services provided to consumers and the estimated quantity of electricity consumed via a direct line. Where this is justified, the system operator has a right to change its assessment twice a year, at the latest by 1 June and by 1 December.

(2) When they receive the corresponding requirement from the system operator, the distribution network operator and the line possessor present, for the next calendar year and within a reasonable time, to the system operator an assessment concerning the volume of network services to be provided by them during the next calendar year and the quantity of electricity to be consumed via a direct line.

(3) Based on the cost assessment mentioned in subsection 1 of this section, the system operator determines, by 1 December, the cost – in euro per one kilowatt-hour of network service and of electricity consumed via a direct line – of procuring and managing the service, taking into account the amount by which, during the 12 months immediately preceding creation of the assessment, the cost was overshot or undercovered. The system operator publishes, on its website, the cost for the next year together with the data on which it is based and the calculations that produced it.

(4) The distribution network operator presents the cost mentioned in subsection 3 of this section by way of a separate item on the invoice for network services and for electricity consumed via a direct line, as a charge for the cost of the service of ensuring island operation capability.

(5) By the fifth day of each month, the distribution network operator and line possessor present to the system operator information concerning the network services provided and the quantity of electricity consumed via a direct line.

(6) Based on the information mentioned in subsection 5 of this section, by the seventh day of each month, the system operator presents an invoice for procuring the service mentioned in subsection 3 of this section to the network operator and to the line possessor; the amount of the invoice is to be paid to the system operator by the 21st day of the month regardless of whether the consumers have, under their invoices, paid the charge for procuring the service.

(7) If the information mentioned in subsection 5 of this section is not presented by the due date, the system operator draws up the invoice based on the assessment by the distribution network operator or line possessor. Once precise information is ascertained, the system operator sets off the amount on the invoice for the next month.

(8) The charge mentioned in subsection 4 of this section is not levied on electricity taken from the network and stored in an energy storage unit during the storage period for quantities of electricity that, during the same period, were returned to the network, provided at least one of the conditions provided by clauses 1–4 of subsection 10 of § 59² of this Act is met.

§ 43. Balance responsibility

(1) A market participant must ensure that the amount of electricity supplied to the network and/or purchased by the market participant in each trading period is equal to the amount of electricity acquired from the network and/or sold by the market participant.

(2) The rights and obligations relating to balance responsibility are provided for in detail by the network code on the functioning of the electricity market.

§ 44. Open supply

(1) In order to perform the obligation mentioned in § 43 of this Act, a market participant concludes a contract with a seller (hereinafter, ‘open supplier’) whereby an open supply is ensured to the market participant (hereinafter, ‘open supply contract’).

(2) In an open supply contract concluded with a market participant, an open supplier names the balance provider who has assumed the obligation to maintain the balance of the market participant who is the other party to such a contract concluded by the open supplier. The balance provider may assume the obligation:

1) by an open supply contract entered into with the open supplier;

2) through an uninterrupted chain of open supplies carried out under open supply contracts, beginning with the open supply provided by the balance provider and ending with the open supply provided to the open supplier mentioned in this subsection.

(3) An open supplier who is a balance provider is not subject to the obligation, provided by subsection 2 of this section, to name a balance provider.

(4) The time limits for concluding an open supply contract, for terminating such a contract and for providing notification of the same are provided by the network code on the functioning of the electricity market.

(4¹) Where a market participant’s contract for open supply has been interrupted, the network operator to whose network the market participant’s electricity installation is connected is regarded as the market participant’s open supplier until conclusion of a new contract. Where open supply is interrupted, the network operator itself provides the service. Where the network operator does not itself sell electricity, it arranges a public procurement procedure to find a seller to provide that service, without giving preference to any undertaking with which it is connected.

(4²) Under subsection 4¹ of this section, the network operator provides open supply to market participants, except for small consumers:

1) for electricity obtained from the network, at the price of balancing electricity, to which it adds any justified costs;

2) for electricity supplied to the network, free of charge.

(5) The system operator is the open supplier of a balance provider. The balance provider concludes a balance agreement with the system operator to ensure open supply.

(5¹) In a micro isolated network, the balance provider’s open supplier is the producer who is subject to the generation obligation mentioned in § 55¹ of this Act.

(6) An open supplier provides information concerning the start and end of open supply to the electricity undertaking which determines the balance of the other party to the open supply arrangement.

(7) An open supplier also provides the information mentioned in subsection 6 of this section to:

1) the distribution network operator of the other party to the open supply if the distribution network operator does not determine the balance of that other party;

2) the entity which determines the balance of the open supplier, if the open supplier has not previously sold electricity to that distribution network.

(8) At the request of the system operator, a balance provider provides to the system operator information concerning the chain of open supplies carried out under its open supply contracts in respect of each market participant whose balance is determined by the balance provider.

(12) The open supplier and balance provider do not require consumers that have concluded an aggregation contract with an aggregator or an active user of the network service to make pay any unjustified payments or fines and do not, in respect of such consumers or users, apply unjustified contractual restrictions or technical requirements that result from the fact that the consumer or user participates in aggregation.

§ 45. Fixed supply

(1) A balance provider establishes rules under which it is to be notified of all fixed supplies to the market participant whose balance is maintained by the provider according to subsection 2 of § 44 of this Act.

(2) The system operator establishes rules under which it is to be notified of all fixed supplies which affect the balance between balance providers or which are carried out through a line crossing the national border.

(3) A party to a fixed supply contract notifies the start of a fixed supply to the balance provider who maintains its balance according to subsection 2 of § 44 of this Act and presents consolidated data concerning the other party to the fixed supply according to the rules established by the balance provider.

(4) A party to a fixed supply contract provides its open supplier with consolidated data concerning the amounts of electricity sold and purchased as fixed supplies during each trading period.

(5) A balance provider provides the system operator with consolidated data regarding the fixed supplies belonging to its balance for each balance provider during each trading period if such fixed supplies affect the balance between it and other balance providers.

§ 46. Balance settlement

(1) The balance of a market participant is settled for each trading period.

(2) A market participant ensures that the data required for the settlement of its balance are presented to the entity responsible for settling its balance according to the rules provided by this Act and the network code on the functioning of the electricity market.

(3) Balance is settled using the following methods:

1) electricity metering by means of a remote reading device;

2) distribution based on a combination of metering and load duration curves;

3) fixed supplies.

(4) As a result of balance settlement, the amount of a market participant’s open supply is ascertained for each trading period.

(5) Balance settlement using a combination of metering and load duration curves is permitted in connection points where the size of the main circuit breaker in the phase and the capacity of the phase do not exceed the limits stated in the network code on the functioning of the electricity market.

(6) Where the balance of a market participant cannot be settled by using a combination of metering and load duration curves as provided by subsection 5 of this section, the balance of the market participant is settled by using electricity metering by means of a remote reading device and by reference to fixed supplies.

(7) A network operator obtains the approval of the Competition Authority for the load duration curves established for its service area.

(8) If electricity consumption by a market participant or a group of market participants differs significantly from the established load duration curves due to the specific characteristics of such a participant or such a category of participants, the distribution network operator concerned may request that the Competition Authority approve, without delay, a new load duration curve that corresponds to the specific characteristics of the participant or category of participants. The distribution network operator may also commence metering the electricity consumed by the market participant or the category of market participants by means of a remote reading device. Any outlays associated with the cost of and incurred in relation to the installation of a remote reading device as well as any additional costs incurred by gathering and processing metering data are reimbursed to the distribution network operator by the market participant concerned.

(9) The electricity balance in a micro isolated network is established based on that network, separately from the balance of the system.

§ 47. Obligations of network operator in settling the balance

(1) For each connection and metering point in its network, a network operator arranges the transmission of metering data necessary for balance settlement and for the settlement of accounts to the entity responsible for balance settlement and to the system operator.

(2) A distribution network operator arranges for settlement of the balance of any market participants connected to its network and for the related exchange of information.

(3) A distribution network operator calculates the amounts of electricity of each market participant who is connected to its network and whose balance is to be settled according to this Act. In calculating the amounts of electricity, the distribution network operator uses data obtained as a result of metering carried out by means of a remote reading device or by a combination of metering and load duration curves.

(4) A distribution network operator provides the balance provider with consolidated data concerning electricity supply to and from its network separately for each market participant whose balance the balance provider maintains under subsection 2 of § 44 of this Act.

(5) A distribution network operator provides a seller with the information required for maintaining the balance and for the settlement of accounts concerning the amounts of electricity calculated in the course of balance settlement for each market participant who is connected to its network and to whom the seller sells electricity.

(6) Once a year the distribution network operator determines, for each market participant, the difference between the amount of electricity calculated using a combination of metering and load duration curves and the actual metered amount of electricity.

(7) If, according to the calculations carried out under subsection 6 of this section, the total amount of electricity calculated based on a combination of metering and load duration curves for market participants to whom the seller sold electricity exceeds the total actual metered amount of electricity for such market participants, the network operator pays the seller for the difference between the said amounts of electricity, and if the total amount of electricity calculated in this way for such market participants is less than the total actual metered amount of electricity for such market participants, the seller pays the network operator for the difference between those amounts.

(8) The charge payable for the difference between amounts of electricity mentioned in subsection 7 of this section is calculated using the average price of electricity during the period of time which was the basis for calculating the amount of electricity; the principles and rules for determining the average price are stated in the network code on the functioning of the electricity market.

§ 48. Obligations of balance provider in settling the balance

(1) A balance provider arranges balance settlement and the related exchange of information in the transmission network and in the metering points between the transmission network and the distribution network for those market participants whose balance is maintained by the balance provider according to subsection 2 of § 44 of this Act. The balance provider also arranges balance settlement and the related exchange of information concerning feeds of electricity from the transmission network to the distribution network for the market participants who have fixed supplies and whose balance is maintained by the balance provider in according to subsection 2 of § 44.

(2) Based on metering data, the balance provider calculates the amounts of electricity sold by market participants whose balance is maintained by the balance provider according to subsection 2 of § 44 of this Act to other market participants through the transmission network. The balance provider also calculates the amounts of electricity for market participants connected to the distribution network, who have fixed supplies in accordance with data obtained as a result of metering using a remote reading device and data obtained as a result of a combination of metering and load duration curves.

(3) For purposes of balance settlement, a balance provider provides the system operator with consolidated data which is based on metering information and which concerns open supplies as well as consolidated data concerning the fixed supplies of those market participants whose balance is maintained by the balance provider in accordance with subsection 2 of § 44 of this Act.

(4) A balance provider provides the seller and the market participant to whom electricity was sold with information that is required for maintaining the balance and for the settlement of accounts in relation amounts of electricity calculated in order to settle the balance.

§ 49. Obligations of system operator in settling the balance

(1) The system operator carries out balance settlement for the whole system and for balance providers and, based on the data obtained, compiles a report on balance deviations between the system operator and the balance providers as well as a report on balance deviations between the system and the power systems of other countries.

(2) The system operator provides a balance provider with information concerning the amounts of electricity the parties have sold to each other. The system operator informs a foreign market participant of amounts of electricity which were purchased and sold by the market participant and which crossed the national border of Estonia.

§ 50. Other obligations in connection with settling the balance

(1) On receiving the corresponding requirement, market participants provide the network operator, the balance provider maintaining their balance under subsection 2 of § 44 of this Act and the system operator with information concerning the purchase, use and sale of electricity, provided the requirement to produce such data is justified in the context of balance settlement or the exercise of balance responsibility.

(2) The balance provider assists the system operator in the rectification of any inaccurate information filed for balance settlement if this is required in order to settle the balance of the whole system.

(3) The rights and obligations prescribed for market participants and the time limit for transmission of the information mentioned in this Chapter are provided for in detail in the network code on the functioning of the electricity market.

§ 51. Purchase and sale of balancing electricity

(1) If, as a result of balance settlement, the balance of a balance provider is negative in any trading period, the system operator is deemed to have sold balancing electricity to the balance provider during the trading period in the amount necessary to maintain the balance of the balance provider during that trading period.

(2) If, as a result of balance settlement, the balance of a balance provider is positive in any trading period, the balance provider is deemed to have sold balancing electricity to the system operator during the trading period in the amount necessary to maintain the balance of the balance provider during that trading period.

(3) The sale of balancing electricity mentioned in subsections 1 and 2 of this section is deemed to have been effected between the system operator and the balance provider under the conditions provided for by this Act, the legislation enacted under it and the balance agreement.

§ 52. Rights and obligations of balance provider

(1) The balance provider is entitled to receive payment for any balancing electricity that it sells to the system operator in accordance with this Act, with the network code on the functioning of the electricity market and with the contract concluded with the system operator.

(2) The balance provider pays for balancing electricity sold to it by the system operator in accordance with this Act, with the network code on the functioning of the electricity market and with the contract concluded with the system operator.

(2¹) The balance provider reimburses to the system operator the perimeter fee payable on the relevant supplies of the market participant whose balance the balance provider maintains.

(3) The balance provider performs any other obligations prescribed by this Act, the network code on the functioning of the electricity market and the contracts concluded with the system operator.

§ 53. Price of balancing service and standard terms and conditions of balance agreements

(1) The price of electricity sold to or by a balance provider during a given trading period following subsections 1 and 2 of § 51 of this Act is determined by the system operator after the end of the given trading period in accordance with this Act and the balance agreement concluded with the balance provider.

(2) When providing the balancing service, the system operator follows the principles provided by Article 44 of Commission Regulation (EU) 2015/1222.

(3) When setting the price of balancing electricity, the system operator may accord preference to market participants whose balance deviation during a given trading period is converse to the balance deviation of the system as a whole during the same trading period, as opposed to market participants whose balance deviation during the same trading period is in the same direction as the balance deviation of the system as a whole.

(4) The system operator obtains approval for standard terms and conditions in the balance agreement from the Competition Authority.

(5) The system operator publishes on its website the price of balancing electricity and the standard terms and conditions of the balance agreement.

(6) The system operator elaborates and presents to the Competition Authority for approval a uniform method for calculating the price of the balancing service.

(7) The system operator ensures, by the method mentioned in subsection 6 of this section, that energy storage units are not subject to double the cost of balancing capacity mentioned in subsection 1 of § 53¹ of this Act.

§ 53¹. Funding the cost of procuring balancing capacity

(1) To cover the costs of procuring balancing capacity, reasonable administrative costs, as well as costs that are not covered by the price of balancing electricity mentioned in subsection 5 of § 53 of this Act, the system operator publishes on its website the supplementary fee for balancing capacity (hereinafter, ’the cost of balancing capacity’).

(2) The system operator calculates the amount of the cost of balancing capacity for one kilowatt-hour of electricity in accordance with the method mentioned in subsection 6 of § 53 of this Act, taking into account any amounts received above or below the target during previous settlement periods. The system operator publishes on its website the amount of the cost of balancing capacity together with data on which the amount is based and the calculations that produced it.

(3) The cost of balancing capacity is covered by consumers and producers to the extent established by the method mentioned in subsection 6 of § 53 of this Act. To the extent to which the method prescribes the cost to be collected from consumers and producers, the open supplier states the cost – calculated following the same method – as a separate item on the invoice for electricity, designating it as the cost of balancing capacity. The balance provider notifies the open supplier of the amount of the cost of balancing capacity that applies to consumers and producers in its balancing area.

(4) Within its balancing area, the balance provider organises payment of the cost of balancing capacity and exchange of information in accordance with the method mentioned in subsection 6 of § 53 of this Act.

§ 54. Rules for paying for balancing electricity

(1) The system operator calculates the amount of the charge to be collected from, and the amount of the charge to be paid to, the balance provider based on the amounts of balancing electricity as determined according to § 51 of this Act and based on the selling price of balancing electricity as determined according to § 53 of this Act.

(2) For each transaction period, the system operator presents an invoice to the balance provider for an amount calculated according to subsection 1 of this section, and pays the invoices presented to it by the balance provider for any amounts calculated according to that subsection.

(3) Specific rules for transmission of data to the system operator and for the calculation, set-off and payment of the charges invoiced to balance providers for balancing electricity and of the charges payable to them for balancing electricity are provided by the network code on the functioning of the electricity market.

§ 55. Obligations of the producer

(1) The generating installations of producers must conform to the technical requirements established by regulations enacted under § 42 of this Act. The network operator to whose network a generating installation is connected or in whose service area such an installation is connected to its network via a direct line and via the electrical installation of a consumer, certifies the installation’s compliance with the requirements after the end of the testing period and based on the test results. If the net capacity of the generating installation exceeds 5 MW, the installation’s compliance with the requirements is certified by the system operator. The generating installation is deemed to be in compliance with the requirements from the date that such certificate is issued. The length of the testing period and other conditions concerning the testing are provided by regulations enacted under § 42 of this Act. If a European product certificate has been issued with respect to a generating installation, the testing of the installation in terms of the parameters and functions covered by that certificate is not required.

(2) The producer complies with the orders issued by the system operator in accordance with this Act.

(3) The producer notifies the system operator without delay of any dangerous situations, accidents or other circumstances that endanger or could endanger the security of supply or the performance of any contractual obligations.

(4) A producer who is an undertaking in a dominant position as defined in the Competition Act and who generates electricity in a combined heat and power production regime must, when it is required to do so by the Competition Authority, produce information concerning the allocation of revenue and costs separately for the generation of electricity and for heat production together with the relevant reasons.

§ 55¹. Producer subject to the generation obligation

The electricity required to meet the electricity needs of consumers in a micro isolated network is generated by a person who concluded the corresponding agreement by a method mentioned in § 66¹ of this Act, or by the distribution network operator in whose service area the micro isolated network is located (hereinafter, ‘producer subject to the generation obligation’).

§ 56. Transfer of generating installation

(1) The owner of a generating installation and a producer must notify the Competition Authority in writing of any transfer of ownership or of direct possession of the generating installation. The notification states the names, personal identification codes or registration numbers in the Commercial Register and contact details of the transferor and transferee or of the person assigning and the person acquiring possession, and information which allows the transferred or assigned generating installation and its location to be identified.

(2) The obligation provided by subsection 1 of this section does not apply to the transfer or assignment of possession of a generating installation with a net capacity of 1 MW or less.

§ 57. Renewable sources

(1) For the purposes of this Act, ‘renewable source’ means water, wind, solar, wave, tidal and geothermal energy sources, landfill gas, sewage treatment plant gas, biogases and biomass.

(2) For the purposes of this Act, ‘biomass’ means the biodegradable fraction of products, waste and residues from agriculture (including vegetable and animal substances), forestry and related industries, as well as the biodegradable fraction of industrial and municipal waste.

(3) Liquid biofuel is regarded as a renewable source within the meaning of this Act if it meets the criteria for the sustainability of liquid biofuels established in accordance with subsection 1 of § 120 of the Atmosphere Protection Act and complies with the principles provided by § 32³ of the Energy Sector Organisation Act.

(4) Biomass fuel is regarded as a renewable source within the meaning of this Act if it complies with the principles provided by § 32³ of the Energy Sector Organisation Act.

§ 58. Generation from renewable sources and efficient cogeneration

(1) Producers may not subsidise generation from renewable sources at the expense of generation from other sources and vice versa. Where this is required by the Competition Authority, the producer presents information on the allocation of revenue and costs separately for generation from renewable sources and for generation from other sources.

(2) The amount of electricity with regard to which a guarantee of origin mentioned in § 32⁷ of the Energy Sector Organisation Act is issued, as well as the quantity of electricity in respect of which the support mentioned in § 59, 59⁴, 59⁵ and 59⁶ of this Act is paid in part or in full, is determined using remote reading devices and is deemed to include the total balance of electricity supplied to the networks of network operators holding the corresponding authorisation through all connection points of the producer’s power station during the trading period, as well as the amount of electricity conveyed to consumers via a direct line that conforms to the requirements of this Act. In a situation mentioned in § 108¹ of this Act – and in a situation where the producer’s power plant or generating installation consists of several stages of such installation, and support is paid for electricity generated in the various stages based on different support schemes or cooperation agreements, or is not paid for electricity generated in some of the stages – the quantity of electricity on which support is paid or for which a certificate of origin is issued is determined, by means of a separate dedicated remote reading device, separately for each stage of the generating installation.

(2¹) The transmission network operator may, in relation to stages of a generating installation that uses the same type of renewable source determine the quantity of electricity generated in a specific stage of the installation proportionately to the share of the electrical capacity of the stage to the capacity of the entire installation.

(2²) When determining the quantity of electricity for which, in full or in part, the support mentioned in § 59⁴ of this Act is payable, the quantity of electricity conveyed to the consumer via a direct line is not taken into account.

(2³) In order to ensure availability of metering data required to ascertain the provenance of electricity and to keep an account of the quantity eligible for support, the transmission network operator has a right to require the recipient of support to install additional remote reading devices on the producer’s side of the connection point.

(2⁴) Where the support mentioned in §§ 59, 59⁴, 59⁵ or 59⁶ is paid – in full or in part – there can only be one generating installation behind the connection point of a distribution or transmission network operator that holds a single authorisation.

(3) By the fifth day of each calendar month, the producer presents, to the transmission network operator, information in respect of each generating installation showing the total amount of electricity generated during the previous calendar month and the amount of electricity generated, during the same month, from renewable sources or in an efficient cogeneration process, as well as the proportion that was sold using the support mentioned in § 59 of this Act.

(4) The Competition Authority and the transmission network operator may require the producer, as well as the line possessor or network operator to whose network or line the producer’s generating installations are connected, to provide the particulars needed to verify the information presented under subsection 3 of this section.

(5) If the amount of electricity actually generated from renewable sources or in an efficient cogeneration process by means of a generating installation which conforms to the requirements of the authorisation is less than the amount of electricity sold by the producer by using the support provided by § 59 of this Act during at least two consecutive calendar months, the Competition Authority may revoke the authorisation or to vary its conditions such that electricity can no longer be sold by using the support mentioned in § 59 of this Act.

(6) Where electricity is generated from a combination of renewable sources and other sources, the producer receives the support allocated under §§ 59, 59⁴, 59⁵ and 59⁶ of this Act only for the quantity of electricity generated from renewable sources. The producer keeps monthly records on the use of energy sources and on quantities of electricity generated from those sources.

(7) The conditions of and rules for determining the proportion of electricity generated from renewable sources are enacted by the minister in charge of the policy sector.

(8) The transmission network operator publishes on its website the rules for filing the information mentioned in subsection 3 of this section.

(9) Where the producer has not presented the information mentioned in subsections 3 and 4 of this section or in subsections 2 and 3 of § 59³ of this Act, or has presented false information, the transmission network operator operator may refuse to disburse the support.

§ 58³. Self-consumers of electricity generated from a renewable source

(1) A consumer may consume electricity they have generated from a renewable source.

(2) A self-consumer of renewable electricity has a right:

1) individually or through an energy broker, to generate, store, trade peer to peer and sell such electricity – among other things under contracts for sale of renewable electricity – to suppliers of electricity without being subjected to discriminatory or disproportionate procedures or fees and – for electricity consumed from or fed into the network – to network charges that do not reflect costs;

2) install and operate, for their own use, electricity storage systems combined with plants producing renewable electricity, without these being subjected to double charges, including network charges;

3) retain their rights and obligations as a consumer;

4) receive market-based remuneration – and, in relevant situations, support under support schemes – for self-generated electricity fed into the network.

(2¹) ‘Peer-to-peer trading’ means the sale of renewable energy between market participants – either directly between the participants or through a certified participant who is a third party – under a contract containing previously agreed terms. The right to peer-to-peer trading does not limit the rights or obligations that parties to such transactions hold as end consumers, producers, suppliers or energy brokers.

(3) The generating installation of a self-consumer of renewable electricity may be owned by, and its installation and operation – including metering and maintenance – may be managed by a third party. Such a third party is not a self-consumer of renewable electricity.

(4) Self-consumers of renewable energy who are located in the same building, including in a block of flats, can participate jointly in operations mentioned in subsection 2 of this section, and are allowed to share, between themselves and within the consumer’s electrical installation, any renewable energy generated in their place or places of generation.

§ 58⁴. Planning of support for renewable energy

(1) The planning of support schemes for generation of electricity from a renewable source is carried out based on the following conditions:

1) the schemes incentivise integration in the electricity market – by a method that is market-based and responds to the market – of electricity generated from a renewable source, avoiding unjustified distortion of the market and taking into account the possible costs of integration in the system and stability of the network;

2) electricity generated from a renewable source is integrated in the electricity market to the greatest extent possible, and it is ensured that producers of renewable energy react to price signals from the market and earn as much revenue as possible in the market;

3) in the case of direct price support schemes, support is granted as market premiums;

4) without prejudice to application of Articles 107 and 108 of the Treaty on the Functioning of the European Union, the amount of support that has been granted and the conditions of its granting are not amended such that this would negatively impact rights flowing from such support and harm economic viability of projects already receiving the support, with the exception of situations where the amount of support is adjusted according to objective criteria prescribed by the support scheme.

(2) Without prejudice to application of Articles 107 and 108 of the Treaty on the Functioning of the European Union, the specific characteristics of renewable energy communities are taken into account when elaborating support schemes, in order for such communities to be able to compete for support on an equal footing with other market participants.

(3) Information concerning support measures constitutes topical information as mentioned in clause 2 of subsection 1 of § 32 of the Public Information Act and is made available to all relevant participants.

§ 59. Support

(1) Producers are entitled to receive, from the transmission network operator, the support mentioned in this section:

1) for electricity generated from a renewable source using a generating installation whose net capacity does not exceed 125 MW;

2) since 1 July 2010, for electricity if it is generated from biomass in an efficient cogeneration process, except where electricity is generated from biomass in a condensation process, in which case no support is paid. Detailed guidelines for cogeneration are enacted by means of a regulation of the Government of the Republic at the proposal of the minister in charge of the policy sector. When making a proposal to the Government of the Republic regarding detailed guidelines for cogeneration, the minister in charge of the policy sector takes the proposal of the Competition Authority as the basis;

3) for electricity if it is generated in an efficient cogeneration regime from waste within the meaning of the Waste Act, from peat or carbonisation gas obtained as a result of oil shale processing;

4) for electricity if it is generated in an efficient cogeneration process with a cogeneration installation which has the electric capacity not exceeding 10 MW;

(2) The transmission network operator pays support to the producer on an application filed by the latter as follows:

1) 0.0537 euros per one kilowatt-hour of electricity if it is generated in accordance with clauses 1 or 2 of subsection 1 of this section;

2) 0.032 euros per one kilowatt-hour of electricity if it is generated in accordance with clauses 3 or 4 of subsection 1 of this section;

3) per one kilowatt-hour of electricity at the rate mentioned in clauses 1 and 2 of this subsection or at the rate approved by the Competition Authority if the electricity is generated in an efficient cogeneration process using a renewable source or peat.

(2¹) The support mentioned in subsection 2 of this section is state aid within the meaning of paragraph 1 of Article 107 of the Treaty on the Functioning of the European Union, and is granted following European Commission’s guidelines on state aid for environmental protection and energy, and the relevant decision of the European Commission authorising the granting of state aid.

(2²) The producer may apply for the support mentioned in subsection 2 of this section for electricity generated by a generating installation that has an electrical capacity of at least 1 MW, provided that producer has, at the latest on 31 December 2016, commenced work on the investment project concerning that generating installation in one of the following ways:

1) commenced the generation of electricity;

2) commenced building work concerning that investment project;

3) assumed a definite obligation to order equipment for constructing the generating installation;

4) assumed any other obligation that makes the investment project irreversible, taking into consideration that obligations making the investment project irreversible are deemed not to include acquisition of the plot on which the generating installation is to be constructed, procurement of requisite authorisations or preparatory works.

(2³) When a producer applies to the transmission network operator for an assessment regarding the producer’s compliance with the condition mentioned in subsection 2² of this section, the transmission network operator must provide the assessment within 90 days following receipt of the application. The running of the time-limit for considering the application is interrupted if the transmission network operator is not provided with the information that it needs to reach a decision in the matter.

(2⁴) In the case of generating installations whose electrical capacity is higher than 50 kW but falls below 1 MW, in order to receive the support mentioned in subsection 2 of this section, the relevant installation of the producer must generate electricity at the latest on 31 December 2018.

(2⁵) For electricity generated by a generating installation with an electrical capacity of up to 50 kW, the producer may receive the support mentioned in subsection 2 of this section provided electricity is generated at the latest on 31 December 2020 and provided the producer has not received investment support from the state for construction of the relevant installation.

(2⁶) The support mentioned in subsection 2⁵ of this section constitutes state aid for the purposes of Article 43 of Commission Regulation (EU) no. 651/2014 declaring certain categories of aid to be compatible with the internal market in application of Articles 107 and 108 of the Treaty (OJ L 187, 26.06.2014, pp. 1–78), and the granting of such aid is subject to the provisions of that Regulation and of § 34² of the Competition Act.

(2⁷) A recipient of the support mentioned in subsection 2⁵ of this section may not, at the time when support is paid, be out of compliance with an order of the European Commission, mentioned in subparagraph (a) of paragraph 4 of Article 1 of Commission Regulation (EU) no. 651/2014 on repayment of state aid declared to be illegal and incompatible with the internal market, and it must not be an undertaking in difficulty for the purposes of point 18 of Article 2 of that Regulation.

(2⁸) The system operator files the information concerning the state aid granted to a person who received the support mentioned in subsection 2⁵ of this section with the Register of State Aid and of de minimis Aid in accordance with subsection 3 of § 49² of the Competition Act, and preserves the documents related to the granting of such aid for 10 years from the last grant of support.

(3) The Competition Authority may, on a corresponding application of the producer, approve a rate that is different from the rate mentioned in clauses 1–3 of subsection 2 of this section if the electricity is generated in an efficient cogeneration process from a renewable source or peat. When a new rate of support is approved, the Ministry of Climate presents a separate state aid notice to the European Commission following § 34¹ of the Competition Act. The transmission network operator applies the new rate of support approved by the Competition Authority after the European Commission’s decision to authorise that rate.

(4) When approving the rate mentioned in subsection 3 of this section, it is taken into account that the support and the market price of electricity together must allow the producer to:

1) cover justified costs incurred in order to generate electricity, provided that the expenditures for fuel do not exceed the market price of the fuel;

2) cover any costs incurred in connection with performing obligations arising from legislation and from the conditions of the authorisation;

3) cover the justified cost of capital;

4) ensure a justified return on capital.

(5) The minister in charge of the policy sector may, if necessary, establish a list of particulars to be included in the application mentioned in subsection 3 of this section and the rules for the filing of such particulars.

§ 59¹. Conditions of support

(1) The following conditions must be met in order to be eligible for the support mentioned in § 59 and 59⁴–59⁶ of this Act:

1) the electricity is generated by means of a generating installation conforming to the requirements of this Act, the grid code and the network code on the functioning of the electricity market;

2) the producer fulfils the obligations provided by Chapter 4 and § 58 of this Act;

3) measurable data to be stated in the application for support concerning the quantity of fuel, the determination of calorific value of the fuel and the amount of heat generated in the cogeneration process have been verified following § 59³ of this Act.

(2) The producer is not granted the support mentioned in §§ 59 and and 59⁴–59⁶ of this Act:

1) if the state has paid the producer – who generates electricity using wind as the source of energy – an investment support for the relevant generating installation, and the producer has not reimbursed the investment support to the state;

2) if the producer lacks the environmental authorisations required in order to generate electricity or is in breach of the conditions stated in such authorisations;

3) for electricity generated for the power station’s own consumption;

4) for electricity generated when, in Estonia’s price area of the power exchange, negative market price was in effect on the day-ahead market;

5) for electricity generated in the framework of a cooperation project mentioned in § 92⁵ of this Act;

5¹) for electricity generated by an operation that, for the purposes of the Energy Sector Organisation Act, uses forest biomass exclusively for the generation of electricity.

6) if the producer is an undertaking in difficulty within the meaning of the European Commission’s guidelines on state aid for rescuing and restructuring non-financial undertakings in difficulty;

7) if the producer is not in compliance with an obligation to repay state aid that has been declared unlawful and incompatible with the internal market by a decision of the European Commission;

8) for electricity of installations generating electricity from biodegradable part of waste and residue and from biodegradable components of industrial and mixed household waste, provided attainment of recovery targets provided by subsection 2 of § 136³ has not been proven according to rules enacted under subsection 4 of that section.

(2¹) Clause 5¹ of subsection 2 of this section does not apply where the electricity mentioned meets the requirements of subsection 14 of § 32² of the Energy Sector Organisation Act and fulfils at least one of the following conditions:

1) it is generated in an area that, due to its reliance on solid fossil fuels, has been identified in a territorial just transition plan adopted under Regulation (EU) 2021/1056 of the European Parliament and of the Council establishing the Just Transition Fund (OJ L 231, 30.06.2021, pp. 1–20);

2) the carbon dioxide emitted in the course of its generation is captured and stored.

(3) The application mentioned in subsection 2 of § 59 of this Act states the particulars of the generating installations, the information required by legislation in order to receive the support and any information which the transmission network operator has listed as required in order to determine the origin of the electricity where the origin and amount of the electricity cannot be established unequivocally.

(5) A producer who uses wind as the source of energy and who complies with the condition mentioned in subsection 2² of § 59 of this Act may receive support until support has been paid in Estonia for a total amount of 600 GWh electricity generated from wind energy in the calendar year. Separate accounts are kept in respect of each calendar year.

(7) Having regard to Directive (EU) 2018/2021 of the European Parliament and of the Council on the promotion of the use of energy from renewable sources (OJ L 328, 21.12.2018, pp. 82–209) and to objectives provided by Directive (EU) 2018/2002 amending Directive 2012/27/EU on energy efficiency (OJ L 328, 21.12.2018, pp. 210–230), the transmission network operator publishes on its website the following information:

1) the estimated amount of electricity to be produced from a renewable source and in a high-efficiency cogeneration process in the following calendar month and the following calendar year;

2) data concerning the amount of electricity generated from wind energy during the given calendar year by calendar month;

2¹) the amount of electricity generated in the previous calendar year from a renewable source;

2²) the amount of electricity generated in the previous calendar year in a high-efficiency cogeneration process;

2³) final consumption of electricity in the previous calendar year;

2⁴) the proportion in per cent of electricity produced in the previous calendar year from a renewable source and in a high-efficiency cogeneration process, based on clauses 2¹–2³ of this subsection;

2⁵) quantities, and forecasts, of greenhouse gas emissions accompanying the energy supplied in the price area by trading period;

3) an estimate for achieving the amount of electricity mentioned in subsection 5 of this section for the current calendar year based on the amount of electricity actually generated from wind energy during preceding months;

4) a list of the particulars mentioned in subsection 3 of this section and the rules for the filing of those particulars;

5) estimated budget of support funds for the following five years or, where there are limitations to budget planning, estimated budget for the following three years.

(8) Where, after having received the administrative order mentioned in subsection 11 of § 59⁴, subsection 5 of § 59⁵ or subsection 8 of § 59⁶, a producer who won the reverse auction announced under subsection 5 of § 59⁴, subsection 1 of § 59⁵ or subsection 1 of § 59⁶ of this Act transfers the generating installation used for their reverse auction bid, the right to receive support passes to the new owner of the installation who must be a producer of electricity. Within 14 days following acquisition of the generating installation, the new owner notifies the acquisition to the person who conducted the reverse auction.

(9) The support granted under § 59, 59⁴, 59⁵ or 59⁶ of this Act is disbursed by the transmission network operator according to the producer’s application for disbursement. The producer cannot apply for disbursement of past support for more than one year.

§ 59². Funding of support

(1) The costs resulting from funding the support mentioned in § 59, 59⁴ and 59⁶ of this Act and the justified costs of administering, accounting, holding the reverse auction for and dealing with disputes related to the support mentioned in § 59, in subsections 4¹–4²³ of § 59² and in §§ 59⁴–59⁶, the justified costs of administering the information system of support for renewable energy as well as the justified costs of administering the electronic database of guarantees of origin of biomethane, hydrogen, electricity or heating or cooling energy that is mentioned in § 32⁷ of the Energy Sector Organisation Act and of the digital environment mentioned in subsection 2 of § 2⁶ of the Liquid Fuel Act are borne by consumers, taking into consideration the volume of network services consumed, the amount of electricity consumed via a direct line and any compensation paid from the state budget under subsection 4⁹ of this section.

(2) The transmission network operator compiles and publishes on its website by 1 December each year an estimate for the next calendar year concerning the cost of funding the support mentioned in §§ 59 and 59⁴ of this Act for electricity generated from renewable sources or in a high-efficiency cogeneration process, concerning the volume of network services to be provided to consumers and concerning the amount of electricity to be consumed via direct lines. Where this is justified, the transmission network operator may adjust, during the current calendar year, the estimate mentioned in this subsection and the cost of funding the support.

(3) When this is required by the transmission network operator, the distribution network operators and line possessors present their estimates for the next calendar year concerning the volume of network services they expect to provide and the amount of electricity they expect to be consumed via direct lines.

(4) Based on the estimate mentioned in subsection 2 of this section, the transmission network operator determines the cost of funding the support in the following calendar year per one kilowatt-hour of network services used and of electricity consumed via a direct line, taking into account any sums by which the funding of the support mentioned in §§ 59, 59⁴ and 59⁶ of this Act during the 12 months immediately preceding the compilation of the estimate overshot the total of support payments or fell short of that, the interest earned on sums by which the funding overshot the estimate or the interest paid on sums by which the funding fell short of the estimate, the revenue received under statistical transfer agreements mentioned in subsection 1 of § 92⁴ of this Act such that it exceeds the cost of funding the support payable to the producers for quantities of energy required to perform the agreement, as well as the justified expenditure for administering, accounting, conducting the reverse auction for and dealing with disputes related to the support mentioned in §§ 59 and 59⁴–59⁶ of this Act, for administering the information system of support for renewable energy, for administering the electronic database of guarantees of origin mentioned in § 32⁷ of the Energy Sector Organisation Act concerning biomethane, hydrogen, liquefied gas, electricity or heating or cooling energy and for administering the digital environment mentioned in subsection 6 of § 2⁶ of the Liquid Fuel Act. The transmission network operator publishes on its website the cost of funding the support together with the underlying data and calculation methods. The transmission network operator publishes, on its website, the amount of the cost of funding the support together with the data on which it is based and the calculations that produced it.

(4¹) When bearing the costs of funding the support mentioned in subsection 4 of this section, the use of a reduction rate may be applied for such that, in respect of the consumer of electricity, the rate amounts to 75 per cent in a sector at risk of carbon leakage – and 85 per cent in a sector at significant risk of carbon leakage – of the megawatt-hour based cost mentioned in that subsection, yet such that the renewable energy charge is not less than 0.5 euro per megawatt-hour of network services consumed, provided:

1) the consumer’s yearly consumption of electricity at connection points, in at least two of the three years preceding the filing of the application mentioned in subsection 4⁸ of this section, amounts to more than 1 GWh – in the case of a new consumer of electricity, the estimated amount of electricity to be consumed through connection points during the 12 following months must be more than 1 GWh;

2) the consumer is a producer of electricity from renewable sources or has concluded, with a seller of electricity acting as an intermediary for the production of such a producer, an electricity contract mentioned in clause 8³ of § 3 of this Act to receive the supply mentioned in clause 1¹ or 17 of the same section, and proves consumption of renewable electricity by cancellation of guarantees of origin issued for the renewable electricity produced by that producer, based on which it is proved that the share of renewable electricity in the applicant’s total consumption amounts to at least 10 per cent in the year 2026, 25 per cent in the year 2027, 35 per cent in the year 2028 and 50 per cent starting from the year 2029;

3) undertakes an energy audit either as a stand-alone audit or in the framework of a certified energy management system or environmental management system according to Article 11 of Directive (EU) 2023/1791 of the European Parliament and of the Council on energy efficiency and amending Regulation (EU) 2023/955 (recast) (OJ L 231, 20.09.2023, pp. 1–111);

4) the economic activity appears in the list mentioned in Annex 1 to Communication from the European Commission – Guidelines on State aid for climate, environmental protection and energy 2022 (OJ C 80, 18.02.2022, pp. 1–89).

(4²) The parent company of a group may apply for assignmen of the reduction rate in respect of:

1) its subsidiary who meets the conditions provided by subsection 4¹ of this section;

2) several subsidiaries (hereinafter, ‘set’) jointly.

(4³) Where assignment of the reduction rate is applied for in respect of the set mentioned in clause 2 of subsection 4² of this section, the eligible subsidiaries’ indicators are added up when assessing conformity to the conditions provided by clauses 1–3 of subsection 4¹ of this section. The condition provided by clause 4 of subsection 4¹ must be met separately by each subsidiary of the set. Where the application has been filed for the set jointly, the set is not assigned a single reduction rate. The reduction rate is assigned separately to each subsidiary of the set according to inclusion of the subsidiary’s economic activity in the list mentioned in Annex 1 of the Communication from the European Commission referred to in clause 4 of subsection 4¹ of this section, and to the subsidiary’s network consumption volume.

(4⁴) Where a reduction rate has been assigned to the set mentioned in clause 2 of subsection 4² of this section and, in the course of oversight, it is ascertained that a subsidiary that is part of the set no longer meets the condition provided by clause 4 of subsection 4¹ , assignment of the reduction rate is terminated strictly in respect of that subsidiary in accordance with the provision in subsection 4¹². Where the set as a whole – without the subsidiary mentioned in subsection 4² of this section – no longer meets the conditions provided by clauses 1–3 of subsection 4¹, assignment of the reduction rate is terminated in respect of all remaining subsidiaries that are part of the set.

(4⁵) The electricity consumer filing the report of the energy audit mentioned in clause 3 of subsection 4¹ of this section must comply with at least one of the following conditions:

1) implement the recommendations presented in the audit report, to the extent that the pay-back time of the relevant investments does not exceed three years and that the cost of those investments is proportionate;

2) reduce CO2 emissions from their electricity consumption and cover at least 30% of such consumption from carbon-free sources;

3) invest at least 50 per cent of the amounts saved as a result of assignment of the reduction rate in projects that lead to substantial reductions of the installation’s greenhouse gas emissions; where applicable, the investment must lead to substantial reductions compared to the benchmark used for free allocation in the European Union Emissions Trading Scheme.

(4⁶) The assignment, to a person, of the reduction rate mentioned in subsection 4¹ of this section constitutes state aid as referred to in paragraph 1 of Article 107 of the Treaty on the Functioning of the European Union, which is granted following the provisions of the Communication from the Commission mentioned in clause 4 of subsection 4¹ of this section and the relevant Commission decision allowing the granting of state aid. The reduction rate mentioned in subsection 4¹ of this section is assigned following the decision of the European Commission allowing the granting of state aid.

(4⁷) To be assigned the reduction rate mentioned in subsection 4¹ of this section, the person files, with the transmission network operator, an application together with documents proving conformity with the conditions provided by that subsection and referred to in subsection 4¹⁴ , and authorises the network operator to acquaint itself with the person’s metering data on the data exchange platform mentioned in § 42¹ of this Act. Assignment of the reduction rate mentioned in subsection 4¹ of this section may be applied for starting from the month following the making of the decision in accordance with subsection 4⁸ such that the monthly renewable energy charge payable by the applicant is reduced to the extent of its network consumption volume. No reduction applies to the renewable energy charge calculated on electricity consumed via a direct line.

(4⁸) The transmission network operator assesses the person’s conformity to conditions provided by subsections 4¹ and 4¹⁴ of this section and, within two months following receipt of the application mentioned in subsection 4⁷ that meets the requirements, makes a proposal to the Ministry of Climate to make a decision in respect of the person on assignment of the reduction rate mentioned in subsection 4¹. The assignment of the reduction rate and the specific rate applicable to the person is decided by the Ministry of Climate in accordance with subsection 4¹ based on which of the lists mentioned in Annex 1 of the Communication from the European Commission mentioned in clause 4 of that subsection includes the person’s economic activity. The ministry notifies the decision to the transmission network operator, the Ministry of Economic Affairs and Communications, the applicant and the network operator connected to the applicant’s electrical installation.

(4⁹) The state aid mentioned in subsection 4⁶ of this section, and the de minimis aid mentioned in subsection 4¹⁶ is granted to the extent of the funds allocated in the state budget to the transmission network operator for this purpose for the budget year. The Ministry of Economic Affairs and Communications arranges the payment of compensation to the transmission network operator from the state budget to set off any shortfall in revenue resulting from the use of the reduction rate and the costs related to granting de minimis aid mentioned in subsection 4¹⁶ of this section. Where, based on estimates or current accounting, it turns out that the funds allocated to the transmission network operator for the budget year are not enough, the operator applies to the Ministry of Economic Affairs and Communications for additional funds. Where no additional funds are allocated or where the allocation does not guarantee that the total amount of state aid granted during the budget year does not exceed the funds mentioned in the first sentence of this subsection, the operator makes a proposal to the Ministry of Climate to decide to vary, suspend or terminate assignment of the reduction rate mentioned in subsection 4¹ of this section to all persons to whom the rate was assigned. The decision is applied to the accounting period such that it ensures the granting of state aid within the limit of the funds allocated, and any shortfall in the charge – determined as a result of ex-post accounting – is to be paid additionally.

(4¹⁰) The person who has been assigned the reduction rate mentioned in subsection 4¹ of this section presents, by 1 February of each year and to the transmission network operator, documents that prove that their electricity consumption volume during the previous calendar year through connection points exceeded 1 GWh and that they meet the conditions provided by clauses 2–4 of that subsection and by subsection 4¹⁴. When the reduction rate has been assigned to the set mentioned in clause 2 of subsection 4² of this section, documents must be presented by the aforementioned date that prove the transfer, in full, to a subsidiary that is part of the set, of the financial advantage arising from assignment of the reduction rate. The transmission network operator is obligated to assess the correspondence of the aid amount that has been paid to the reduction rate mentioned in subsection 4¹ of this section and to the provisions of this subsection and, in the event of overcompensation, makes a reasoned proposal to the Ministry of Climate to recover the aid. The ministry makes the decision to recover the aid. The amount to be recovered is refunded by the aid recipient to the transmission network operator together with late charges at the latest by 1 July of the same year. A new application for the aid can be filed when the conditions to receive the aid are met.

(4¹¹) The person’s right to assignment of the reduction rate mentioned in subsection 4¹ of this section ends when they no longer meet the conditions provided by clauses 2–4 of that subsection and their electricity consumption volume in the year subject to verification does not exceed 1 GWh. Any person who has been assigned the reduction rate mentioned in subsection 4¹ of this section notifies the transmission operator without delay when they no longer meet the conditions provided by that subsection.

(4¹²) Where the transmission network operator receives, from the aid recipient, notification on voluntary termination of assignment of the reduction rate, or the notification provided for by subsection 4¹¹ of this section, or ascertains that the person to whom the reduction rate mentioned in subsection 4¹ has been assigned no longer meets the conditions for assignment of the rate, it makes a reasoned proposal to the Ministry of Climate to issue a decision on terminating the assignment to the person of the reduction rate mentioned in subsection 4¹. In the decision, the Ministry of Climate determines the time from which the person is assigned the amount – set in accordance with subsection 4 of this section – of the cost per kilowatt-hour of network services consumed. The decision may also be retroactive, in which case the person who inappropriately used the reduction rate must retroactively refund, in full and with late charges, the amount they received starting from the time from which they no longer meet the conditions for assignment of the reduction rate.

(4¹³) The Ministry of Climate notifies the decision mentioned in subsection 4¹² of this section without delay to the transmission network operator, the Ministry of Economic Affairs and Communications and the person in whose respect assignment of the reduction rate mentioned in subsection 4¹ was terminated, as well as the network operator or line possessor connected to the person’s electrical installation.

(4¹⁴) The state aid mentioned in subsection 4⁶ of this section is not granted to persons in difficulty for the purposes of the European Commission’s Guidelines on state aid for rescuing and restructuring non-financial undertakings in difficulty, or to persons who have not complied with the obligation to refund state aid declared illegal and incompatible with the internal market under a decision of the European Commission.

(4¹⁵) Detailed conditions for assignment of the reduction rate and for taking into account additional economic activities, the list of evidentiary items, conditions for document preservation an for the cumulation of aid, reporting requirements and conditions for refunds together with the methodology for the calculation of late charges are enacted by a regulation of the minister in charge of the policy area.

(4¹⁶) When covering the cost of funding the support mentioned in subsection 4 of this section, application may be made, in respect of a consumer of electricity and for the previous calendar year, for de minimis aid to be granted as a one-off refund whose amount corresponds to the discount obtained by assignment of the reduction rates mentioned in subsection 4¹, provided the consumer meets the conditions provided by clauses 1, 2 and 4 of subsection 4¹.

(4¹⁷) The de minimis aid mentioned in subsection 4¹⁶ of this section is granted in accordance with Regulation (EU) 2023/2831 of the European Commission on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid (OJ L, 2023/2831, 15.12.2023).

(4¹⁸) To apply for the de minimis aid mentioned in subsection 4¹⁶ of this section, the person presents an application to the transmission network operator together with documents proving conformity to the requirements referred to in subsections 4¹⁶ and 4¹⁷, and authorises the network operator to acquaint itself with the person’s metering data on the data exchange platform mentioned in § 42¹ of this Act.

(4¹⁹) The transmission network operator assesses the conformity of the aid recipient to conditions referred to in subsections 4¹⁶ and 4¹⁷ of this section, calculates the amount of de minimis aid according to the actual consumption of the consumer of network services during the previous calendar year based on the reduction rate mentioned in subsection 4¹ and on the lower limit of that rate, and makes a proposal to the Ministry of Climate to issue a decision on the granting of de minimis aid. Where the total of the aid amounts calculated in accordance with this subsection and presented in applications that meet the requirements exceeds the funds allocated for the budget year that is captured by the accounts, the amount of de minimis aid that has been granted is reduced proportionally according to a reduction coefficient.

(4²⁰) The granting of de minimis aid and the amount of such aid is decided by the Ministry of Climate, which notifies the decision to the Ministry of Economic Affairs and Communications, the transmission network operator and the applicant.

(4²¹) On the basis of the decision of the Ministry of Climate, the transmission network operator pays de minimis aid to the applicant as a one-off refund.

(4²²) A person may not, for consumption through the same connection points in the same calendar year, obtain assignment of the reduction rate mentioned in subsection 4¹ of this section and receive de minimis aid mentioned in subsection 4¹⁶. When filing the application, the person affirms having selected one type of aid for the calendar year in question. De minimis aid is not granted on consumption volumes that are the subject of a recovery decision.

(4²³) Detailed conditions for granting de minimis aid, requirements that must be met to receive such aid, rules for the accounting of electricity consumption in additional economic activities, calculation methodology, rules for the filing and consideration of applications, conditions for document preservation and for the cumulation of aid are enacted by a regulation of the minister in charge of the policy sector.

(5) The network operator presents the consumer an invoice for network services and for electricity consumed via a line possessor’s direct line, setting out as a separate item the cost of funding the support for electricity generated from renewable sources and electricity generated in an efficient cogeneration process.

(6) The distribution network operator and the line possessor present, to the transmission network operator, by the fifth day of every month, information regarding the amount of network services provided and regarding the amount of electricity consumed via a direct line.

(7) The transmission network operator, based on the information mentioned in subsection 6 of this section, by the seventh day of every month presents an invoice to the network operator or line possessor for the funding of the support. The amount specified in the invoice must be paid to the transmission network operator by the 21st day of the month, regardless of whether consumers have paid for the funding of the support.

(8) If the information mentioned under subsection 6 of this section is not presented by the due date, the transmission network operator may issue an invoice based on an estimate of the consumption by the consumers of the distribution network operator or line possessor. When accurate information is received, the transmission network operator sets off the accounts on the invoice for the next month.

(9) The transmission network operator pays the support mentioned in § 59 of this Act to the producer on the 21st day of the calendar month if the requirements provided by § 59¹ have been met.

(10) The cost of funding the support referred to in this section is not applied to electricity stored from the network in an energy storage unit during the storage period to the extent of the quantity of electricity returned to the network during the same period, provided at least one of the following conditions is met:

1) a supplementary metering point has been constructed for the energy storage unit in accordance with subsection 1¹ of § 67 of this Act;

2) there is no consumption at the metering point at which the energy storage unit is located apart from self-consumption by the storage unit or power station and the net capacity of the storage unit is at least 50 per cent of the metering point's load-side throughput capacity;

3) at the metering point at which the energy storage unit is located, electricity is strictly stored and consumed;

4) electricity taken from and electricity returned to the network by the energy storage unit is metered by a special metering device, the storage unit provides, to the network operator, the flexibility service mentioned in § 66² of this Act or the balancing service mentioned in point 3 of Article 2 of Commission Regulation (EU) 2017/2195 and the metering data metered by the special metering device have been transmitted to the data exchange platform mentioned in § 42¹ of this Act.

§ 59³. Reporting on the fuel used to generate electricity or – by high-efficiency cogeneration – electricity and heat

(1) The producer ensures the measurement and accounting of the quantities of fuel used to generate electricity or – by high-efficiency cogeneration – electricity and heat, and ascertains and documents the calorific value of the fuel.

(2) By the fifth day of each calendar month, the producer presents, to the transmission network operator, a report on the fuel used, the calorific value of the fuel used to generate electricity or – by high-efficiency cogeneration – electricity and heat, as well as information on the electricity and heat that were generated.

(3) The producer is under a duty to present, when they are required to do so by the transmission network operator, the particulars that are needed to verify the information presented under subsection 2 of this section.

(4) The duty mentioned in subsections 1–3 of this section applies to producers that generate electricity using a source other than wind, solar or hydropower as the primary energy.

(5) Where electricity is generated in a combined fashion from renewable as well as other sources, the producer keeps monthly accounts by the different types of fuel used for the generation.

(6) The producer keeps monthly accounts of the total amount of electricity generated as well as of the heat generated by high-efficiency cogeneration.

(7) The calorific value is ascertained:

1) by using the method of fuel sample testing, in the course of which the calorific value of the sample is ascertained directly, or

2) by calculation – ascertaining another characteristic of the fuel and arriving at the calorific value through the use of the relevant formula.

(8) Ascertainment of the calorific value by the method of testing is allowed strictly by a testing laboratory accredited to test the type of fuel concerned.

(9) The minister in charge of the policy sector enacts, by means of a regulation, the list of particulars to be stated in the report on the fuel used to generate electricity or – by high-efficiency cogeneration – electricity and heat, the rules for filling out and filing, and providing evidence for such the report, the rules and requirements for ascertaining the calorific value of the fuel.

§ 59⁴. National target of generating electricity from renewable sources and by high-efficiency cogeneration, and achieving that target

(1) Under this section, support is paid to the generation of electricity from renewable sources in order to achieve the target share of renewable electricity mentioned in subsection 1 of § 32¹ of the Energy Sector Organisation Act.

(4) By 1 April each year, the Ministry of Climate compiles an overview of the progress towards attaining the objectives mentioned in subsection 1 of this section and compiles an estimate of the additional quantity of electricity required to attain those objectives. The compiling of the aforementioned overview is based on the particulars published in accordance with clauses 1−3 of subsection 7 of § 59¹ of this Act. The overview is published on the website of the Ministry.

(4¹) At the latest by 1 October 2023, the minister in charge of the policy sector makes a proposal to the Government of the Republic to arrange a reverse auction in order to bring to the market offshore wind power generation capacity in order to achieve the target mentioned in subsection 1 of this section.

(5) If, according to the estimate, the objectives provided by subsection 1 of this section will not be attained, the Government of the Republic authorises the minister in charge of the policy sector to arrange a public reverse auction in order to find the most advantageous producer to generate the quantity of electricity required to attain the objective.

(5¹) The Government of the Republic, when authorising arrangements for a reverse auction under subsection 5 of this section, determines at least the following:

1) the date on which generation is to commence and the period during which generation must take place;

2) per calendar year, the type, generation technology and maximum quantity of supported electricity that is the subject matter of the bid, together with the maximum increase possible;

3) the minimum period during which the bid remains effective;

4) the security deposit related to a bid and the conditions of its payment;

5) the upper limit of the support for the winner of the auction;

6) in the case of the reverse auction mentioned in clause 4 of subsection 5² of this section, the sum of the support and of the exchange price of the day-ahead market electricity trading period for Estonia’s price area, up to which support may be paid.

(5²) Depending on the needs of the power system, a reverse auction may be intended for producing, from a renewable source, additional electricity that is generated by:

1) a new adjustable-capacity generating installation;

2) an existing generating installation or

3) a new generating installation whose capacity is not adjustable;

4) a new generating installation used onshore to generate wind power.

(5³) For the purposes of this Act, ‘generating installation whose capacity is not adjustable’ means an installation whose generated amount of electricity the producer cannot adjust on the orders of the system operator.

(5⁴) For each megawatt-hour of generated electricity, the upper limit of the support mentioned in clause 5 of subsection 5¹ of this section does not exceed:

1) 50 euros for a generating installation mentioned in clause 1 of subsection 5²;

2) 10 euros for a generating installation mentioned in clause 2 of subsection 5², provided that the amount received, together with the arithmetic mean power exchange price of the day-ahead market in the Estonian price area for the calendar month preceding the calendar month during which the support is disbursed, does not exceed 60 euros;

3) 30 euros for a generating installation mentioned in clauses 3 and 4 of subsection 5².

(5⁵) Where a reverse auction has been won by a producer with a generating installation mentioned in clause 2 of subsection 5² of this section, the producer provides, to the holder of the auction, at the latest by 1 February each year, an overview of the purchase prices of fuel used during the last calendar year in the framework of using the support.

(5⁶) Where, based on the purchase prices mentioned in subsection 5⁵ of this section, the holder of a reverse auction concludes that overcompensation may be occurring in relation to the owner of the generating installation mentioned in clause 2 of subsection 5² of this section, the minister in charge of the policy sector makes a proposal to the Government of the Republic to reduce the rate of the support stated in the Government’s administrative order in respect of the producer in question such that that rate would not permit the producer to generate electricity at a profit that is higher than the average for the electricity generating sector.

(5⁷) Overcompensation occurs in relation to a producer mentioned in subsection 5⁶ of this section is if the difference between the support and the purchase prices of fuel allows the producer to generate electricity at a profit that is higher than the average of the sector.

(7) Electricity cannot be bid in a reverse auction if it has been generated from a renewable source and has been used to contribute, during up to 12 months preceding the auction, to achieving the aim provided by subsection 1 of this section – or if it has been generated by a generating installation for whose electricity, by the time the reverse auction is announced, the producer has, under §§ 59, 59⁵ or 59⁶ of this Act, received support for a total period of 12 years.

(8) If a generating installation that participates in a reverse auction has received investment support on behalf of the State, a proportion of the investment support corresponding to the period of operating support must be deducted from the rate of the support mentioned in this section.

(10) The conditions and rules of the reverse auction, the rules for accounting the generation product required in the auction and the rules for calculating the support payable to auction winners are enacted by the Government of the Republic by regulation, following European Union rules for state aid.

(11) At the proposal of the minister in charge of the policy sector, the Government of the Republic decides, by an administrative order, the producer to generate an additional quantity of electricity determined under subsection 5 of this section, and to receive, for up to 12 years starting from commencement of generation, support based on the results of the reverse auction.

(11¹) Where the producer commences generation later than the due date stated for commencement of generation in the notice of the reverse auction– or than the additional due date set under clause 1 of subsection 4 of § 59⁸ of this Act – the support period starts to run, respectively, from the due date stated in the notice of the auction or the due date set under clause 1 of subsection 4 of § 59⁸.

(11²) Where the producer feeds, over a 12-month period following the due date stated for commencement of generation in the notice of the reverse auction – or following the additional due date set under clause 1 of subsection 4 of § 59⁸ of this Act – into the network of a network operator holding the relevant authorisation, a quantity of electricity that falls below 60 per cent of the yearly volume specified in the administrative order, payments of support to the producer are suspended from the time that the deficiency was ascertained, until the generating installation has, over a 12-month period, fed into the network of a network operator holding the relevant authorisation at least 60 per cent of the yearly volume specified in the aforementioned order.

(11³) Where the bid that won the reverse auction included more than one generating installation, for the purposes of subsection 3 of § 108 of this Act generation is deemed to have commenced on the day on which all of the generating installations included in that bid commenced generation – or, on the basis of a reasoned application of the tenderer who was declared the winner, the day on which generation was commenced using a part of the installations included in the bid – and, for the purposes of subsection 3¹ of § 108, generation is deemed to have commenced on the day on which the producer presents, to the person who conducted the reverse auction, network contracts and an application to commence generation by all generating installations included in that bid or by installations that were included in the bid and that cover the quantity of energy to be generated according to the bid.

(12) The Government of the Republic may revoke the administrative order mentioned in subsection 11 of this section if the winner of the reverse auction does not comply with the conditions prescribed in the auction. The order may also be revoked if, at the latest 18 months after the issuing of the order, the winner has not obtained a building permit for the generating installation, and has not concluded a connection contract for connecting the installation to the network.

§ 59⁵. The objective of generating energy from a renewable source for statistical energy transfers and attainment of that objective

(1) If the need to produce an additional quantity of electricity from a renewable source in order to fulfil the agreement mentioned in subsection 1 of § 92⁴ of this Act becomes apparent, the Government of the Republic authorises the minister in charge of the policy sector to arrange a public reverse auction to find the most advantageous producer.

(2) The reverse auction is not open to electricity produced by a generating installation for which the producer, at the time when the reverse auction is announced, already receives the support mentioned in this section or in §§ 59, 59⁴ or 59⁶ of this Act, or energy that, at the time the reverse auction is announced, already contributes to meeting the objectives provided by Annex I of Directive 2009/28/EC of the European Parliament and of the Council.

(3) The reverse auction is subject to the condition provided by subsection 8 of § 59⁴ of this Act.

(4) The conditions and rules for reverse auctions are enacted by an order the Government of the Republic. When enacting such conditions and rules, the Government follows the guidelines mentioned in subsection 2¹ of § 59 of this Act.

(5) At the proposal of the minister in charge of the policy sector, the Government of the Republic determines, by an administrative order, the quantity of energy required to fulfil the agreement mentioned in § 92⁴ of this Act and the producer who will be paid support based on the results of the reverse auction mentioned in subsection 1 of this section for the period during which the relevant statistical transfer agreement is in effect. The annual cost of the support must not exceed the annual income received by the transmission network operator under the agreement mentioned in subsection 1 of § 92⁴ of this Act.

(6) Where a producer who made the best bid in a reverse auction mentioned in subsection 1 of this section uses biomass to produce energy, the Ministry of Climate, before the administrative order mentioned in subsection 5 is brought into effect, and before the agreement mentioned in subsection 1 of § 92⁴ of this Act is concluded, presents to the Government of the Republic an analysis of the effect that the procurement of the quantity of biomass required to produce the energy will have on the Estonian wood market. The analysis is performed based on the principles stated in the strategic plan mentioned in § 7 of the Forest Act. Before concluding the agreement, the Government hears the opinions of the Committee on Economic Affairs and the Committee on Environment of the Riigikogu.

(7) The Government of the Republic may revoke the administrative order mentioned in subsection 5 of this section if the winner of the reverse auction does not comply with the conditions they agreed to under the auction or if, at the latest 18 months after the issuing of the order, the winner has not obtained a building permit for the generating installation, and has not concluded a connection contract for connecting the installation to the network.

§ 59⁶. Reverse auction of generating installations that have an electrical capacity of less than 1 MW and that use a renewable source

(1) Under this section, support is paid under the rules of a reverse auction for electricity produced by generating installations that use a renewable source and that have an electrical capacity of more than 50 kW and less than 1 MW with the objective of increasing the annual generation of electricity by such producers in the years 2019−2021 by 5 GWh.

(2) The objectives of reverse auctions for generating installations mentioned in subsection 1 of this section that will come into effect after the year 2021 are to be established by a resolution of the Riigikogu.

(3) The Government of the Republic presents the objectives mentioned in subsection 2 of this section to the Riigikogu for approval at least 3 months before their estimated adoption.

(4) The reverse auction is arranged for by the minister in charge of the policy sector.

(5) The conditions and rules of a reverse auction are established by an order the Government of the Republic. When establishing such conditions and rules, the Government follows the guidelines mentioned in subsection 2¹ of § 59 of this Act.

(6) The reverse auction is open only to bids for the production of electricity by a generating installation that will begin to generate electricity for the first time after determination of the winner of the auction and for which no investment support has been paid on behalf of the State.

(7) The highest rate of the support to be granted to the winner of the reverse auction is 0.0537 euro for each kilowatt-hour of electricity generated from a renewable source, determining the rate of the support such that the payment received by the producer, including the average exchange price of electricity in the day-ahead market in the Estonian price area for the calendar month preceding the calendar month in which the support is paid, does not exceed 0.093 euro for each kilowatt-hour.

(8) The Government of the Republic decides, by an administrative order, the producer who will generate the additional quantity of electricity determined within the framework of the reverse auction, and who will, for 12 years starting from commencement of production, be paid support based on the results of the reverse auction.

(9) The Government of the Republic may revoke the administrative order mentioned in subsection 8 of this section if the winner of the reverse auction does not comply with the conditions prescribed in the auction.

§ 59⁷. Requiring a security deposit in relation to a bid; returning the deposit

(1) Any participant of the reverse auction mentioned in §§ 59⁴–59⁵ of this Act provides, to the holder of the auction, a security deposit whose amount is determined by the Government of the Republic when making the decision for the auction to be arranged.

(2) The amount of the security deposit may not exceed 20 euros for each megawatt-hour of the yearly generation capacity stated in the reverse auction notice.

(3) The security deposit may take the form of:

1) a guarantee issue by a credit or financial institution or an insurance company;

2) a cash deposit that has been paid into the current account of the holder of the reverse auction mentioned in the regulation enacted under subsection 10 of § 59⁴ or subsection 4 of § 59⁵ of this Act.

(3¹) The rating of the credit or financial institution or insurance company mentioned in clause 1 of subsection 3 of this section must be at least an investment-grade credit rating. When issuing the guarantee mentioned in subsection 3 of this section, the credit or financial institution or insurance company may rely on the credit rating of the parent company of its group.

(3²) Where the tenderer withdraws its bid after the due date for submission of bids, they are not refunded their deposit, which becomes property of the state; in the case of a guarantee mentioned in clause 1 of subsection 3 of this section, the holder of the reverse auction requires the guarantor to make the payment, which becomes property of the state.

(4) Where a bidder is not declared winner of the reverse auction, the holder of the auction refunds the security deposit to the bidder within five business days following the entry into effect of the administrative order mentioned in subsection 11 of § 59⁴ or subsection 5 of § 59⁵ of this Act.

(5) Where a bidder is declared winner of the reverse auction, the holder of the auction refunds the cash deposit to the bidder, or notifies the issuer of the guarantee provided as the deposit of the holder’s renouncement of rights held under the guarantee within five business days following the time starting from which the winner is generating power at the yearly capacity stated in the administrative order mentioned in subsection 11 of § 59⁴ or subsection 5 of § 59⁵ of this Act.

(6) The cash deposit is not refunded to the winner of the reverse auction and becomes property of the state – whereas in the case of a deposit provided for by clause 1 of subsection 3 of this section, the holder of the auction requires the issuer of the guarantee to make the corresponding payment, which becomes property of the state – if:

1) during the first 12 months following the due date for commencement of generation stated in the administrative order mentioned in subsection 11 of § 59⁴ or subsection 5 of § 59⁵ of this Act – or following an additional due date set under clause 1 of subsection 4 of § 59⁸ of this Act – the winner of the auction does not generate electricity to the extent of at least 60 per cent of the annual amount stated in the order or, during the first 24 months, of at least 80 per cent of two times that amount, or

2) the administrative order mentioned in subsection 11 of § 59⁴ or subsection 5 of § 59⁵ is revoked under subsection 12 of § 594 or subsection 7 of § 59⁵.

(7) Any cash deposit funds that have become property of the state under subsections 3² and 6 of this section and any funds received from the issuer of a guarantee are used to fund the support allocated under subsection 4 of § 59² of this Act in the year in which such funds became property of, or were received by, the state. If the amount that became property of the State or was received from the issuer exceeds the cost of funding such support in the relevant year – as determined in accordance with subsection 4 of § 59² of this Act – the funds that have not been used are charged to state revenue.

§ 59⁸. Holder of a reverse auction

(1) The reverse auction provided for by §§ 59⁴–59⁶ of this Act is held by the transmission network operator.

(2) The holder of the reverse auction:

1) verifies whether the bids that have been made, and the generating installations, meet the requirements established in legislation;

2) returns any bid, if the bid, or the generating installation, does not meet those requirements;

3) establishes a ranking order of bids that meet the requirements and makes a proposal to the party that arranged for the auction concerning producers to be paid the support;

4) in a situation mentioned in subsection 56 of § 59⁴ of this Act, makes a proposal to the party arranging the auction to change the rate of the support for the winner of the auction;

5) where a circumstance mentioned in subsection 12 of § 59⁴ or subsection 7 of § 59⁵ of this Act is ascertained, makes a proposal to the party that arranged for the auction to revoke, in respect of the winner, the administrative order mentioned in subsection 11 of § 59⁴ or subsection 5 of § 59⁵.

(3) The holder of the reverse auction may verify whether the winner of the auction complies with the conditions stated in the administrative order mentioned in subsection 11 of § 59⁴, subsection 5 of § 59⁵ or subsection 8 of § 59⁶.

(4) Where the holder of the reverse auction ascertains that the operations of the winner of the auction do not meet the requirements of this Act or the legislation enacted under it, the holder may:

1) set a time limit of up to eighteen months to the winner to commence generation if, by the due date stated in the notice of the reverse auction, commencement of generation by means of the generating installation included in the winner’s bid is not possible for a reason beyond the control of the producer, which has come to light after the bid was made;

2) suspend the payment of support to the winner until the requirements are met;

3) make a proposal to the party that arranged for the auction to vary the administrative order of the Government of the Republic and not to pay the support to the winner, or to reduce such support.

(5) Specific rights and duties of the holder of the reverse auction in reverse auction proceedings are enacted by the regulation of the Government of the Republic mentioned in subsection 10 of § 59⁴, subsection 4 of § 59⁵ or subsection 5 of § 59⁶of this Act.

§ 60. Construction of network and provision of network services

(1) A network or a line may be constructed and/or network services may be provided in the service area indicated in the authorisation of a distribution network operator only by the distribution network operator. This does not apply if in the service area of the distribution network operator:

1) a transmission network is constructed and network services are provided through this network by the transmission network operator;

2) a direct line is constructed and used in accordance with § 61 of this Act and the relevant authorisation – where an authorisation is required under this Act;

3) a direct current line that crosses the national border is constructed and it is used in accordance with § 61 of this Act and the corresponding authorisation;

4) a closed distribution network is being built or electricity is being conveyed in a closed distribution network.

(2) It is not contrary to subsection 1 of this section when:

1) an electrical installation which belongs to another distribution network operator is located in or crosses the service area defined in the authorisation issued to the distribution network operator and network services are provided to the distribution network operator through the electrical installation;

2) an electrical installation which belongs to another distribution network operator is located in or runs across the service area defined in the authorisation issued to the distribution network operator, and network services are not provided to consumers located in the area through the electrical installation;

3) another distribution network operator reconstructs an electrical installation which it owns in the service area defined in the authorisation issued to the distribution network operator and network services are not provided to consumers in the area through the electrical installation.

4) there is a direct line in the service area defined in the authorisation issued to the distribution network operator.

§ 61. Direct line and line crossing the national border

(1) A consumer or an electricity undertaking has a right to construct and use a direct line in order to supply electricity to itself or to consumers or to an undertaking belonging to the same group as the electricity undertaking only if:

1) the direct line is built on the item of immovable property on which the producer’s power station is situated, on an adjacent item of immovable property or from the generating installation or the connection point of that installation to an electrical installation;

2) due to the need to modify the network contract entered into with the network operator under § 83 of this Act the builder of the direct line has agreed with the network operator the terms and conditions of consumption or production or has agreed to amend those terms and conditions for reasons related to the construction of the direct line and the connection of the generating installation to the network;

3) the builder of the direct line has presented to the network operator information regarding the maximum rated operating voltage of the line, the length of the line, its geographic coordinates, its layout and other principal technical parameters.

(1¹) A line possessor installs a metering device which meets the requirements established in legislation in order to determine the amounts of electricity conveyed via its line and ensure the collection and processing of metering data according to this Act and the network code on the functioning of the power system.

(1²) A direct line may be constructed in an area other than the area mentioned in clause 1 of subsection 1 of this section only if at least one of the following conditions is met:

1) the network operator has refused to connect the electrical installation of the consumer, producer or seller to the network or to provide other network services on grounds other than those mentioned in clauses 1 and 2 of subsection 3 of § 65 of this Act and if contesting such a refusal with the Competition Authority in accordance with § 99 of this Act has not yielded a solution which would ensure the requested electricity supply to the consumer, producer or seller;

2) the network operator in whose service area the direct line is envisaged to be constructed gives its written consent to the construction and use of the direct line.

(4) A direct current line which crosses the national border and which has a voltage exceeding 10 kV is connected to the transmission network in the location determined by the transmission network operator and in compliance with the technical conditions established by the transmission network operator.

(5) An alternating current line which crosses the national border and which has a voltage exceeding 35 kV may be constructed and used only by a network operator who holds the authorisation for the activity mentioned in clause 4 of subsection 1 of § 22 of this Act.

(6) If a market participant wishes to preserve the capacity of an existing network connection when using a direct line, such a participant pays to the network operator the charge mentioned in clause 3 of subsection 1 of § 71 for being allowed to use the connection.

§ 62. Service area

(1) The service area of a distribution network operator is the area which is stated in the decision to issue an authorisation to the operator and determined by the national border and/or geographical coordinates.

(2) The service area of the transmission network operator is the territory of Estonia.

(3) A network operator has one service area consisting of one or more defined areas.

(4) The service areas of distribution network operators may not overlap.

§ 63. Modification of service area

(1) Distribution network operators may mutually agree to modify their service areas such that the territory covered by the service areas of such distribution network operators before the modification remains so covered after the modification.

(2) Distribution network operators transmit, to the Competition Authority, a notification concerning any modification to the service areas mentioned in subsection 1 of this section and the relevant agreement they have concluded concerning such a modification. The notice states information that allows the distribution network operators and the new boundaries of their service areas to be determined in accordance with subsection 1 of § 62 of this Act.

(3) The distribution network operators also give notice of any modifications of the service area to any consumers affected by the modification.

(4) Within 30 days following receipt of a notification mentioned in subsection 2 of this section, the Competition Authority, as a single exercise, makes the corresponding amendments to the information concerning the service areas mentioned in the decisions to issue authorisations to the distribution network operators.

(5) A modification of a service area becomes effective when the Competition Authority has, as a single exercise, made the corresponding amendments to the information concerning the service areas mentioned in the decisions to issue authorisations to the distribution network operators and when any consumers affected by the modifications have been notified of the same.

(6) Distribution network operators notify consumers of any modifications to service areas on their website.

§ 64. Network owner

(1) Where the owner of the network is not a network operator who holds an authorisation for the provision of network services through that network, the owner ensures that the network is used by a network operator who holds the required authorisation and who is responsible for performance of the obligations of the network operator as provided by legislation and for compliance with the conditions of the authorisation.

(1¹) A network operator whose service area includes consumers who have previously been connected to a network mentioned in subsection 1 of this section must continue to provide network service to those consumers under the same technical conditions, taking into account the state of repair and the capacity of the network which it has been given to use.

(1²) A network operator mentioned in subsection 1¹ of this section bears the cost of assuming the use of the network mentioned in subsection 1 of this section. If assuming the use of the network is technically not possible or not expedient, a consumer’s installation that is connected to that network is connected by the network operator to its own network at its own expense.

(1³) Where a network has been built in the period from 1 July 2003 to 30 June 2018 by a person other than a network operator holding a corresponding authorisation, the costs of handing over the network to be used by a network operator mentioned in subsection 1¹ of this section is borne jointly and severally by the owner with the possessor of the network who uses the network to convey and sell electricity to the consumer. Where handing over the network is technically not possible or not expedient, a consumer’s installation which is connected to that network is connected by the network operator to its own network and the costs are borne jointly and severally by the owner and the possessor.

(1⁴) Where a network is built after 1 July 2018 by a person other than a network operator holding a corresponding authorisation, the costs of handing over the network to be used by a network operator mentioned in subsection 1¹ of this section are borne jointly and severally by the owner and the possessor of the network who uses the network to convey and sell electricity to the consumer. The network operator is not obligated to assume the use of such a network.

(1⁵) The owner of the networks mentioned in subsections 1, 1³ and 1⁴ of this section ensures that electricity is conveyed to consumers who are connected to its network under a connection contract on the technical conditions agreed with the consumer until the use of that network is assumed by a network operator holding the relevant authorisation. The owner of the network may interrupt the network connection only under the rules provided by § 90 of this Act.

(1⁶) Where, in order to consume or generate electricity, a person has, after 1 April 2022, connected their electrical installation to another such installation which is not a distribution network operator’s network, the person undertakes to apply for connection to the distribution network operator’s network in order to use network service.

(2) Where the owner of a network transfers the network to another person, the owner notifies this to the Competition Authority without delay. The notification states the names, personal identification codes or registration numbers in the Commercial Register and contact details of the transferor and transferee as well as information that makes it possible to identify the transferred network.

(3) On a corresponding application, the Competition Authority may release a network owner from performance of the obligation mentioned in subsection 1 of this section if the network owned by the owner is located in the service area of another network operator and is not required for supplying electricity to consumers.

(4) The provisions of this section do not apply to closed distribution networks.

(5) Subsections 1–1⁵ of this section do not apply to energy communities.

§ 65. Provision of network services

(1) A network operator provides the following network services to consumers, energy communities, producers, line possessors or any other network operators within its service area:

1) on a corresponding application, connection to the network at the connection point of any electrical installation which conforms to the requirements and which is located in its service area;

2) on a corresponding application, amendment of the conditions of consumption or of generation;

3) allowing a network connection to be used at the connection point;

4) transmitting electricity through its network to the connection point or from the connection point;

4¹) with regard to granting a connection to a generating installation or to modifying the conditions of generation or consumption in the micro isolated network located in the service area of the distribution network operator, the consumption demand required for the provision of network service is lacking;

5) ensuring the installation of a metering device conforming to the requirements of legislation to determine the amounts of electricity transmitted through its network;

6) ensuring the collection and processing of metering data;

7) provision of supplementary services directly related to the network services mentioned in clauses 1−6 of this subsection.

(1¹) A distribution network operator engages in cooperation with an energy community to facilitate conveying any electricity that has been generated by the community for consumption to members of that community.

(1²) The following particulars that are stated in the producer’s connection application, in a valid offer to conclude the connection contract and in the connection contract are public, and the network operator publishes these on its website:

1) the business name of the market participant;

2) the date of issuing the offer to conclude the connection contract and its validity period;

3) the date of conclusion of the connection contract and the period within which the contract is to be performed;

4) the location of the connection point and the connection voltage;

5) the name of the power station;

6) the type of the power station;

7) the connection capacity;

8) the time when the generating and storage installation was connected to the network.

(1³) At the request of the connection applicant, the network operator issues the technical specifications for a recharging point not accessible to the public that ensure that the recharging point is ready for:

1) use of the V2G system;

2) use of smart charging;

3) interfacing the smart meter of the V2G system's metering point with near real-time metering.

(2) The network operator observes the principle of equal treatment of market participants when providing network services.

(3) The network operator may refuse to provide network services if:

1) the electrical installations of the user of network services do not conform to the requirements of legislation or to the technical conditions established by the network operator for connection to the network;

2) the provision of network services is not possible for any other reason due to the user of network services;

3) the provision of network services is not possible for reasons independent of the network operator;

4) the network of the network operator lacks the necessary transmission capacity for the provision of network services;

5) the corresponding right of the network operator arises on any other grounds provided by this Act.

(3¹) The transmission network operator may not refuse to connect a new electricity generation or energy storage unit to the network for the reason that, in future, available transmission capacity within the meaning of point 4 of Article 2 of Regulation (EU) 2019/943 of the European Parliament and of the Council may prove inadequate.

(4) The network operator states the reasons for any refusal to provide a network service. The reasons must include a reference to the legal basis for the refusal. The network operator notifies the Competition Authority of its refusal to provide network services on the grounds provided by clauses 4 and 4¹ of subsection 3 of this section.

(5) The minister in charge of the policy sector enacts, by means of a regulation, quality requirements for network services and conditions for the reduction of network charges in the event that those quality requirements are violated.

(6) Establishment of the conditions for the reduction of network charges is based on the duration of power interruptions.

(7) The network operator publishes on its website information regarding the network services and their prices and regarding the method which consumers can use to access their consumption data.

(8) In a situation where a consumer has expressed a corresponding request, the network operator communicates the consumption data of such a consumer to the consumer in accordance with the form for exchange of data provided by the network code on the functioning of the electricity market.

(9) The distribution network operator may terminate its operations only if it has assigned its obligations under this section to another distribution network operator having regard to the provisions of subsection 4² of § 91 of this Act.

(10) At least 12 months prior to the termination of its operations, the distribution network operator must notify this to the Competition Authority in writing and to present an overview of the action plan that ensures compliance with the requirements provided by this section.

§ 66. Network development obligation

(1) The network operator develops the network within its service area such as to ensure the continued provision, in accordance with legislation and the conditions of its authorisation, of network service to all consumers, energy communities, producers, line possessors and any other network operators that are connected to the network or will be connected to it in future, having regard to their justified needs, and to ensure that a market participant’s electrical installation which meets established requirements and is located within the service area of the operator – or such an installation that estimates suggest the market participant will build in future – can be connected to the network. When developing the network, the network operator acts with a view to the need to ensure the security of supply, to achieve efficiency and the integration of markets, having regard to the research conducted in these fields.

(2) By 15 April each year, a distribution network operator presents, to the Competition Authority and the transmission network operator, a written estimate that is as precise as possible, of the total prognosticated demand for usage capacity within its service area for each of the seven years following the estimate’s presentation. The distribution network operator also states the preconditions on which its estimate is based.

(3) By 15 June each year, the transmission network operator presents to the Competition Authority a written estimate which is as precise as possible, of the total prognosticated demand for usage capacity in the entire transmission network for each of the seven years following presentation of the estimate. The transmission network operator also indicates the premises on which its estimate is based.

(4) Together with the estimate mentioned in subsections 2 and 3 of this section, the network operator presents a detailed written plan to the Competition Authority on how it intends to provide network services to satisfy the likely demand for usage capacity indicated in the estimate.

(5) If, based on the estimate mentioned in subsection 2 or 3 of this section or the plan mentioned in subsection 4, or by another method, the Competition Authority finds that the operations envisaged by the distribution network operator may prove insufficient in order to ensure the provision of network services in accordance with the justified needs of the users of such services, the Competition Authority communicates its position to the distribution network operator and to the transmission network operator. The position must state its reasons.

(6) The distribution network operator and the transmission network operator present their written opinion on the position of the Competition Authority to the Authority within thirty days following receipt of the Authority’s position.

(7) Having regard to the reasoned positions expressed in the opinions mentioned in subsection 6 of this section, the Competition Authority decides whether the network operator must implement general measures in its network as a whole in the future, and which measures they should be, to ensure the provision of network services in accordance with the justified needs of the users of network services. If necessary, the Competition Authority issues a corresponding compliance notice to the network operator or varies the conditions of the authorisation of the network operator.

(8) Development and use of flexibility services in a network must be based on a transparent ten-year plan for network development, which the network operator formulates at least after every two years.

(8¹) A distribution network operator who is a vertically or horizontally integrated undertaking and in whose network the total yearly electricity consumption of consumers connected to the network is less than 100 GWh is not required to create the development plan mentioned in subsection 8 of this section.

(9) In the network development plan, the distribution network operator states:

1) any mid-term or long-term flexibility services required;

2) for the next five to ten years, a list of envisaged investment projects together with their timeline and planned cost;

3) the possibilities for connecting new-generation generating capacity and new loads, including electric vehicle recharging points, to the network;

4) any other means which the operator intends to use as an alternative to network extension.

(10) When formulating the network development plan, the distribution network operator consults with users of connections to its network and with the transmission network operator, publishes on its website the results of the consultations together with the development plan and files the plan with the Competition Authority. A distribution network operator who is subject to the obligation to create a network development plan mentioned in subsection 8 of this section, also files with the Competition Authority the list of investment projects related to fulfilment of the development obligation, together with their timeline and cost.

(11) A user of a connection to the network is a natural or legal person who sells electricity to the distribution or transmission network or to whom electricity is sold from that network.

(12) In the network development plan, the transmission network operator states:

1) principal elements of transmission infrastructure that must be built or renovated during the next ten years;

2) a list of investments which have already been decided or which have to be made within the next three years;

3) a list, timeline and cost of investment projects – including projects related to the network development obligation – for the next ten years;

4) any flexibility services to be used in lieu of network extension;

5) estimated consumption;

6) possibilities for trading with other countries;

7) investment plans for European Union and regional networks in accordance with Article 48 of Regulation (EU) 2019/943 of the European Parliament and of the Council;

8) any ancillary services required.

(13) When formulating the network development plan, the transmission network operator consults with stakeholders, publishes the plan on its website and files it with the Competition Authority.

(14) When reviewing the network development plan created in accordance with subsection 12 of this section, the Competition Authority consults with all users of connections to the network and publishes the results of consultation on its website.

(14¹) The Competition Authority may issue a compliance notice to the network operator for the network development plan to be amended to meet the conditions provided by this Act. The Authority publishes the list and timeline of investment projects on its website and monitors implementation of the plan.

(14²) By 3 March each year, transmission and distribution network operators present a report to the Competition Authority concerning the making of investments stipulated in the network development plan.

(15) The transmission network operator engages in cooperation with the regional coordination centre and takes into account any recommendations that the centre makes with a view to improving the performance of the operator’s tasks.

(16) The transmission network operator manages flows in the transmission network having regard to electricity trading with any other transmission or distribution networks that are connected to its network and to one another.

§ 66¹. Arrangements concerning the purchase of electricity in micro isolated networks

(1) In a micro isolated network, the producer invests in the production of electricity and the distribution network operator concludes agreements to ensure the security of investments, following the rules provided by the Public Procurement Act, having regard to the principles provided by subsection 1 of § 1 of this Act.

(2) If, in a micro isolated network, the need arises to create additional generation capacity, or if the period of the agreement corresponding to subsection 1 of this section expires, the distribution network operator arranges the production of the electricity required, having regard to the requirements provided by the Public Procurement Act and in this section. Preference is given to electricity generated from a renewable source, taking into consideration the requirements of the security of supply.

(3) In a micro isolated network, the distribution network operator and the producer of electricity may be one and the same person.

(4) If the distribution network operator arranges, in a micro isolated network, for the production of electricity by a producer subject to a production obligation, the conditions of the envisaged agreement must contain at least the following particulars:

1) the production capacity purchased;

2) the annual quantity of electricity to be purchased;

3) the period of the agreement;

4) the annual electricity consumption curve;

5) the requirements of the security of supply;

6) the conditions on which costs that the network distribution operator may incur in the event of failure to meet the requirements of the security of supply are to be covered.

(5) The provisions of this section do not exempt a distribution network operator from the obligation to present its network charges and standard terms to the Competition Authority for approval following the rules provided by § 73 of this Act.

(6) The network operator publishes on its website the start and end dates of the agreements that it is party to and that have been mentioned in subsection 4 of this section, together with the production capacity and the annual quantity of electricity to be purchased as reflected in those agreements.

§ 66². Flexibility services

(1) In order to find flexibility service providers with the aim to improve efficiencies in the operation and development of the distribution network, the distribution network operator conducts a public procurement procedure. When conducting the procedure, the operator must not give preference to any undertaking with which it is connected.

(2) The distribution network operator obtains approval for the conditions of the public procurement mentioned in subsection 1 of this section from the Competition Authority. The Authority may decide not to approve the conditions if these do not observe the principles of equal treatment and transparency.

(3) The distribution network operator is not required to use the flexibility services provided for by subsection 1 of this section if it has ascertained that using such services would be economically inefficient or lead to serious market distortions or cause congestion. The operator files a reasoned application with the Competition Authority for not using flexibility services.

(4) The Competition Authority may decide not to grant the application mentioned in subsection 3 of this section if, in the course of verification, it comes to light that use of flexibility services is economically efficient, does not lead to serious market distortions or cause congestion.

(5) To ensure secure functioning of the network and facilitate the development of the market, the distribution network operator exchanges requisite data and coordinates its actions with the transmission network operator.

§ 66³. Ancillary services

(1) A distribution network operator engages in cooperation with the transmission network operator for market participants who are connected to the network to be able to efficiently participate in electricity markets. In accordance with Article 57 of Regulation (EU) 2019/943 of the European Parliament and of the Council and Article 182 of Commission Regulation (EU) 2017/1485 establishing a guideline on electricity transmission system operation, the distribution network operator and the transmission network operator agree on conditions for providing balancing services based on the resources of the distribution network.

(2) The network operator conducts a public procurement procedure to find a provider of ancillary services required to ensure secure functioning of the network. When conducting the procedure, the operator must not give preference to any undertaking with which it is connected.

(3) With respect to specification of non-frequency ancillary services and to technical conditions of certain products, the network operator must first conduct a public consultation, whose results are presented to the Competition Authority together with the principles for procuring the service. The Authority may decide not to approve the principles and issue a compliance notice for these to be amended if they do not ensure cost-efficient procurement of the service and do not observe the principles of equal treatment and transparency.

(4) A network operator is not required to use the non-frequency ancillary services provided for by subsection 2 of this section, if it is the operator’s assessment that the use of such services – provided externally – is economically inefficient. The operator files a reasoned application with the Competition Authority for not using ancillary services.

(5) The Competition Authority may decide not to grant the application mentioned in subsection 4 of this section if, in the course of verification, it comes to light that use of market-based non-frequency ancillary services is economically efficient.

(6) The requirement to conduct a public procurement does not apply to fully integrated network components.

§ 67. Metering

(1) A network operator ensures that the amounts of electricity supplied to and from, or stored in, its network are determined and that metering data are collected and processed by means of metering devices that conform to technical requirements established by legislation, in accordance with legislation and the contract for the provision of network services (metering).

(1¹) Based on an application from the market participant, the distribution network operator constructs a supplementary metering point to ascertain the quantity of electricity stored in the energy storage unit during the storage period. Based on the application of the market participant, the transmission network operator issues, to the participant, technical requirements for constructing a metering point within the energy storage unit installation.

(1²) The costs entailed by construction of the supplementary metering point mentioned in subsection 1¹ of this section are borne by the market participant on whose application the metering point is constructed.

(1³) The terms of use of the metering point and of handling metering data are agreed in the connection point's network contract. The network operator may require provision of proof of intended-purpose use of the metering point.

(2) Remote reading devices are to be used in respect of market participants whose balance cannot be determined using a combination of metering and load duration curves under subsection 5 of § 46 of this Act.

(4) Technical requirements for metering devices used in respect of different groups of consumers and electricity undertakings are provided by the network code on the functioning of the power system.

(6) The network operator, of its own motion or at the request of the market participant or of the seller who sells electricity to the participant, installs a metering device which is technically more sophisticated than that prescribed for the market participant by this Act and the network code on the functioning of the power system, and carries out metering by means of that device. The person who made the request for the installation of a technically more sophisticated metering device reimburses to the network operator the cost of the metering device and any outlays associated with its installation as well as any reasonable additional costs incurred in order to collect and process metering data.

(7) The network code on the functioning of the power system provides the rules for calculation of the amounts of electricity supplied to or from the network and for calculation of electricity losses between a metering device and the connection point if the metering of electricity amounts is carried out elsewhere than the connection point.

(8) The network operator may perform the obligations provided by this section itself or authorise a third party to perform such obligations in part or in full.

(9) The owner of the special metering device ensures that the device meets the requirements provided by law.

§ 68. Unlawful use of electricity or of network services

(1) The use of electricity or network services is unlawful if there is no legal basis for the use or if requirements arising from this Act are violated, in particular if:

1) the metering device is damaged or its reading is tampered with or the device’s operation is affected by other means;

2) electricity is used without a valid contract between the network operator and the seller;

3) the seal or verification mark on the metering device or any other device preventing access to the metering device or preventing its operation from being interfered with or recording its operation is removed or damaged;

4) the connection to the network of a network operator lacks a metering device which conforms to the requirements and which has been installed by the network operator.

(1¹) The activity mentioned in clause 2 of subsection 1 of this section is not deemed unlawful use of electricity or network services if:

1) the person mentioned in clause 1 or 2 of subsection 6 of § 15 of this Act regularly presents invoices to their consumer for network services and electricity used and the consumer has paid the invoices on time;

3) the open supply contract of a market participant has been interrupted and the network operator to whose network the market participant’s electricity installation is connected provides open supply to the market participant until the execution of a new contract.

(2) The market participant compensates the network operator for the cost of any electricity and network services used unlawfully and for any harm caused by such unlawful use and reimburses to the operator any reasonable costs incurred to determine the extent of such harm.

(3) The minister in charge of the policy sector enacts, by means of a regulation, rules for determining the amount of electricity and the volume of network services that have been used unlawfully authorisation and the cost of the electricity and network services that have been used unlawfully.

§ 69. Confidentiality requirement

(1) A network operator maintains as confidential any sensitive business information of a market participant that it has become privy to in the course of its operations. This provision does not apply if:

1) the information has already been made public or has become known in any manner other than through a breach of the obligations of the network operator;

2) disclosure of such information to a third party is necessary for performance of the operator’s obligations under this Act;

3) the operator is required by legislation to disclose the information.

(2) The network operator observes the principle of equal treatment in publishing any information related to its work.

§ 70. Obligation to provide information

(1) The network operator provides the Competition Authority, when the latter has issued the corresponding requirement, with information necessary for the Competition Authority to perform the functions imposed on it by the law.

(2) The network operator notifies the Competition Authority without delay of its merger, division, reorganisation or dissolution or of the commencement of bankruptcy or liquidation proceedings in its regard, as well as of any other circumstances that may prevent the network operator from performing the obligations mentioned in legislation or arising from the conditions of the authorisation.

(3) The technical conditions established by a network operator for connection to its network and the principles for calculating the charge payable for connection to the network and for amendment of consumption or generation conditions (hereinafter connection conditions) must be transparent and observe the principle of equal treatment.

(4) The network operator publishes on its website the connection conditions mentioned in subsection 3 of this section.

(5) The transmission network operator makes the connection conditions known to the European Commission.

(6) The network operator publishes on its website, and also communicates to the Competition Authority, basic information concerning the effectiveness, quality and profitability of its network operations.

(7) When the Republic of Estonia Centre for Defence Investment issues the corresponding requirement, the distribution network operator provides the information to be recorded in the Register of Civil Assets. The network operator does not charge a fee for providing the information.

(8) The network operator provides market participants – on an equal footing – with information required for efficient access to and use of the network.

§ 70¹. Obligation to allow use of network infrastructure

(1) The distribution network operator is obligated to allow other undertakings to use its physical infrastructure, above all power poles, for the installation of an electronic communications network that offers broadband access services with a speed of at least 30 megabits per second. The distribution network operator may recover the direct cost of offering access to its physical infrastructure, above all the cost of repairs and of the elimination of malfunctions.

(2) The rules for the filing of application with the distribution network operator and for disposing of such application, as well as the grounds for refusing to grant the application and the rules for resolution of disputes are provided by Chapter 6¹ of the Building Code.

§ 71. Network charges

(1) The charges payable for network services provided by a network operator (hereinafter, ‘network charges’) are as follows:

1) a charge for connection to the network (hereinafter, ‘connection charge’);

2) a charge for amendment of the conditions of consumption or generation (hereinafter, ‘charge for amendment of conditions’);

3) a charge for ensuring the possibility to use a network connection (hereinafter, ‘charge for using a network connection’);

4) a charge for the transmission of electricity (hereinafter, ‘transmission charge’);

5) charges for any additional services directly related to network services;

6) charges for reactive power supplied to the network and acquired from the network.

(2) A network operator establishes network charges in its service area in accordance with this Act and the legislation enacted under it.

(3) The criteria adopted by a network operator as the basis for establishing network charges must be transparent and comply with the principle of equal treatment.

(4) When setting the rate of the network charge, a network operator observes Regulation (EU) 2019/943 of the European Parliament and of the Council and the requirements provided by Annex XI of Directive 2012/27/EU of the European Parliament and of the Council on energy efficiency, amending Directives 2009/125/EC and 2010/30/EU and repealing Directives 2004/8/EC and 2006/32/EC (OJ L 315, 14.11.2012, pp. 1–56), and has regard to need to ensure the security of supply, to achieve efficiency and to integrate markets as well as to the results of the research conducted in the relevant field.

(5) The rate of network charges must be established such that they ensure, on a consistent basis:

1) coverage of the necessary variable and operating costs, which among other things are deemed to include costs of limiting the feeding of the producer’s electricity into the network due to network restrictions;

2) investments to meet operating and development obligations;

2¹) investments to ensure continuity of a vital service;

3) compliance with environmental requirements;

4) compliance with quality and safety requirements;

5) a justified return on the capital invested by the undertaking.

(5¹) Calculation of the justified return mentioned in clause 5 of subsection 5 of this section is based on the capital invested by the undertaking and on the price of weighted average capital.

4) it possible for a network operator to perform the obligations arising from legislation and fulfil the conditions of the authorisation, and to ensure a justified return on invested capital.

(6) A network operator sets the transmission charge such that it guarantees, to market participants who have paid a connection charge and a charge for use of the network connection, the possibility of transmitting electricity throughout the entire system.

(7) Network charges may differ from one network operator to another.

(8) The network charges of the transmission network operator must be sufficient to allow the operator to administer and, with a view to meeting the obligations imposed by law, to develop the data exchange platform mentioned in § 42¹ and the comparison tool meeting the requirements provided by subsection 3 of § 82¹ of this Act.

(9) Any costs related to the use and coordination of the flexibility services mentioned in § 662 as well as any justified costs related to use of the ancillary services mentioned in § 663 of this Act are included in the network operator’s operating costs and are taken into account when setting network charges.

(10) The transmission charge provided for by clause 4 of subsection 1 of this section does not apply to the feeding back into the network of electricity stored during a storage period.

(10¹) The transmission charge according to clause 4 of subsection 1 of this section is not applied to electricity stored from the network in the energy storage unit during the storage period to the extent of the quantity of electricity returned to the network during the same period, provided at least one of the conditions mentioned in clauses 1–4 of subsection 10 of § 59² of this Act is met.

(10²) In the case of violation of the terms of use of the metering point mentioned in subsection 1¹ of § 67 of this Act, the network operator may apply the charge for transmission of stored electricity and funding of support in accordance with quantities of electricity consumed from the network retroactively for up to 12 months starting from ascertaining the violation.

(11) The network operator may procure the electricity to be purchased in order to make up for transmission losses (hereinafter, ‘wasted power’) under an electricity supply contract provided the contract:

1) only includes supplies of electricity generated from renewable sources;

2) has been concluded for up to 50 per cent of the annual amount of wasted power estimated by the network operator;

3) has been concluded with a supplier that has been found by means of the open procurement procedure carried out in accordance with the Public Procurement Act.

(12) By derogation from clause 2 of subsection 11 of this section, the supply contract may be concluded for more than 50 per cent of the annual amount of wasted power estimated by the network operator where this has been approved by the Competition Authority based on the principles mentioned in subsection 8 of § 72 of this Act.

(13) Justified costs related to compliance with the obligations mentioned in § 21⁴ of this Act are added to the transmission operator's operating costs and are taken into account when setting network fees.

§ 72. Principles for calculating network charges

(1) Within the service area of a network operator, the transmission charge and the charge for the use of a network connection do not depend on the location of the market participant.

(2) The network operator may distinguish the network charge for a network service from other conditions for the provision of the network service in relation to the level of voltage and the security of supply, in accordance with the relevant provisions of this Act.

(2¹) Where a network operator has infringed the quality requirements for the provision of network services, such an operator is required to reduce the network charges for those services according to the requirements established in legislation enacted under subsection 5 of § 65 of this Act.

(3) The network operator may distinguish categories of market participants and to apply different network charges and other conditions for the provision of network services for such categories in accordance with the relevant provisions of this Act.

(4) The Competition Authority elaborates and publishes uniform methods, based on the weighted average cost of capital, for the calculation of the network charges mentioned in clauses 3−5 of subsection 1 of § 71 of this Act and uses these as the basis when approving the network charges of network operators. The methods applied by the Competition Authority must have regard to the provisions of this section and of § 71.

(5) In order to reduce regional price differences that result from differing network charges, measures of support may be implemented under a resolution of the Government of the Republic to support a network operator or consumers.

(6) Calculation of the price of the network charges mentioned in clauses 3−5 of subsection 1 of § 71 of this Act is based on the average sales quantity of the last three calendar years. Where this is necessary, additional analysis is performed to ascertain the sales quantity.

(6¹) During the period of network development obligation, the network operator has a right to make, in addition to performing an existing network contract, an investment that is required for connecting a new generation- or consumption-oriented capacity envisaged by the operator, or for changing the consumption or generation conditions in the network. In the transmission network, such an investment may only be made when connecting to the existing transmission network of the transmission network operator.

(6²) The network operator’s investment that is related to the network development obligation is taken into account when calculating the cost of the network services mentioned in clauses 3–5 of subsection 1 of § 71 of this Act, and is charged to the principal assets required for the network operator to provide network services.

(6³) When connecting to the transmission network, the connection fee may consist of a cost-based price, a fixed-rate component of the connection fee in euro per megavolt-ampere (hereinafter, ‘grid reinforcement fee’), the costs – based on cost components fixed in the transmission network operator’s price list – of substation work required to create the network connection (hereinafter, ‘connection creation fee’) as well as processing, operation-based and project management fees or other fees, provided such fees are prescribed by the method mentioned in subsection 1 of § 71 of this Act. Specific conditions for payment of the connection fee for creating the connection to the transmission network and for setting that fee are provided in the regulation enacted under subsection 3 of § 42 of this Act.

(6⁴) When connecting to the network or when changing the network’s consumption or generation conditions – for which the investment mentioned in subsection 6¹ of this section is used – the cost charged in the framework of the network operator’s network development obligation to the operator’s principal assets required for provision of network service is reduced by the amounts of the grid reinforcement fee and network connection creation fee that have been received. Processing, operation-based and project management fees are not set off.

(6⁵) When connecting to the network a generating installation or when increasing the capacity in the existing transmission network, the method – mentioned in subsection 1 of § 73 of this Act – for calculating the connection fee must take into account:

1) estimated cost of investments into the network as foreseen in the transmission network operator’s network development plan;

2) the principle that investments made under the development obligation benefit both generation and consumption, and, based on this, to allocate one half of the estimated cost of the network investments envisaged in the development plan to fixed-rate component calculation;

3) estimated capacity of new generation-oriented connections;

4) the need to ensure that the fixed fee remains as stable as possible, in order to reduce the risks of generation capacity development.

(6⁶) When connecting to the network a generating installation or when increasing the capacity in the existing transmission network, the method – mentioned in subsection 1 of § 73 of this Act – for calculating the connection fee must take into account the fee for creating the connection point:

1) the average cost of creating the connection point;

2) the need to ensure that the fixed fee remains as stable as possible, in order to reduce the risks of generation capacity development.

(7) The price does not include the following expense items:

1) the expense of claims that are unlikely to be paid;

2) sponsorships, gifts and donations;

3) costs that are not connected to the provision of the network service;

4) any fines or late charges imposed on the undertaking under applicable legislation;

5) financial charges as a separate cost component, which are taken into account when calculating the price of weighted average capital;

6) other costs that are not required in order to perform the obligations imposed on the undertaking by legislation.

(8) Any costs to be included in the price must be justified and reflect a cost-effectiveness based approach and must make it possible for the undertaking to perform the obligations provided for by legislation. Justified operating costs are evaluated based on the following principles:

1) observation of the dynamic of the cost over time and its comparison with the dynamic of the consumer price index;

2) analysis of the justification of cost components together with expert assessments;

3) comparison of the undertaking’s costs and of the statistical indicators calculated based on those costs to the costs of other similar undertakings.

(9) When calculating the justified return and the depreciation of fixed assets to be included in the price, only the fixed assets required for provision of the network service are taken into account. The following are excluded from such assets:

1) long-term financial investments;

2) intangible assets, except software licences and rights of use of property;

3) fixed assets acquired in the framework of unrecoverable assistance and targeted financing;

4) fixed assets acquired for connection fees, provided these are not related to fixed assets that have been acquired under subsection 6¹ of this section;

5) fixed assets that the undertaking does not use for the provision of the network service.

(10) The accounting of the value of fixed assets is performed on a continuous basis and continues through any change of the undertaking or of the form of asset ownership.

(11) Justified return is calculated based on the principle according to which the value of the fixed assets required for the provision of the network service, plus the operating capital component, is multiplied by the price of weighted average capital.

(12) The rate of the component of operating capital amounts to five per cent of average turnover for the last three calendar years. Where this is necessary, additional analysis is performed to ascertain the operating capital component.

(13) For costs to be included in the price, justified investments and outlays that have been made for realising energy savings at the final consumer level are taken into account in the amount of up to one per cent of the average sales income for the last three calendar years, provided the following conditions have been met:

1) as a result of the investments and outlays, energy savings are realised at the final consumer within the meaning of clause 21 of § 3 of the Energy Sector Organisation Act;

2) such energy savings have previously been evaluated in accordance with the regulation enacted under subsection 1 of § 18 of the Energy Sector Organisation Act;

3) by 1 April each year, in accordance with the regulation enacted under subsection 1 of § 18 of the Energy Sector Organisation Act, the undertaking assesses the energy savings realised as a result of the actions performed during the last three calendar years and presents a report regarding that assessment to the energy savings coordinator within the meaning of the Energy Sector Organisation Act.

(14) Calculation of the depreciation of fixed assets is based on the value of the fixed assets required for provision of the network service and of the standard depreciation rate corresponding to the useful technical life of those assets.

§ 72¹. Revenue generated by allocations of cross-border capacity

(1) Any revenue that the system operator receives from allocations of cross-border capacity between Members States of the European Union and third countries, including allocations under multilateral contracts by the system operators, is not included in the justified sales revenue based on which the system operator’s network charge is calculated.

(2) The system operator uses the revenue mentioned in subsection 1 of this section to cover the cost of investments related to synchronising Estonia’s power system with the Central European frequency area. In its financial accounting, the system operator keeps separate accounts concerning the revenue and its use.

(3) When the cost of investments mentioned in subsection 2 of this section has been covered, the remainder of the revenue mentioned in subsection 1 of this section is charged to the system operator’s justified sales revenue.

(4) By 31 July each year, the system operator presents to the Competition Authority a report in which it shows:

1) the amount of the revenue that is mentioned in subsection 1 of this seection and that has been earned during the calendar year preceding presentation of the report;

2) particulars concerning the cost of investments made, or intended, during the preceding calendar year under subsection 2 of this section.

§ 73. Approval of network charges and standard terms and conditions

(1) A network operator obtains approval from the Competition Authority for methods for the calculation of network charges mentioned in clauses 1 or 2 of subsection 1 of § 71 of this Act, for network charges mentioned in clauses 3–6 of that subsection 1 and for standard terms and conditions for the provision of network services. The requirement for approval does not apply to the transmission charge for the transit of electricity. When approving network charges, the Competition Authority, among other things, has regard to the provisions of §§ 40, 44, 59, 71 and 72 of this Act and to the relevant standard terms and conditions of the network operator.

(2) The Competition Authority does not grant approval to standard terms and conditions if their substance does not reflect the balance of rights and obligations of the network operator and a user of network services which was the basis for approval of the network charge or if a standard term or condition is unfairly prejudicial the other party within the meaning of the Law of Obligations Act.

(3) The network operator may apply for the Competition Authority’s approval of different network charges collectively as well as separately and the Competition Authority is obligated to dispose of such applications in accordance with this Act.

(4) The network operator charges a fee for the network services it provides; the charge is calculated based on the relevant network charges approved by the Competition Authority. This provision does not apply to connection to the network, amendment of the consumption or generation conditions or the transmission of electricity in the case of transit.

(5) Subsections 1−4 of this section are applied in respect of a network operator who provides network services through a closed distribution network if this is requested by a commercial consumer whose electrical installation is connected to such a network.

§ 74. Provision and publication of information

(1) A network charge established by a network operator becomes effective on the date determined by the network operator after its publication on the operator’s website, when at least ninety days have elapsed since its publication. This provision does not apply to the connection fee, the fee for the amendment of conditions and the transmission charge levied on the transit of electricity.

(2) The network operator publishes, on its website, a notice concerning amendment of the standard terms and conditions for the provision of its network services or concerning the establishment of new standard terms and conditions at least thirty days before the amendments or new standard terms and conditions become effective.

(3) On a corresponding application of a market participant, the network operator provides such a participant with information concerning the rates of the network charges and the standard terms and conditions for the provision of network services which apply in its service area.

(4) The network operator notifies the European Commission and the Competition Authority without delay of any request for transmission of electricity by transit that is based on an electricity sale contract concluded for a period exceeding one year.

(5) Having received a corresponding application, the network operator commences, without delay, negotiations over the conditions for the transmission of electricity by transit and notifies the European Commission and the Competition Authority if the negotiations do not lead to conclusion of a contract within twelve months following the filing of the application.

(6) Information required for efficient access to and use of the network is provided by the network operator on the operator’s website or, on a corresponding enquiry by a market participant, in the form determined by the operator.

(7) The connection fees established by the network operator, which are based on the method approved under subsection 1 of § 73 of this Act, are published on the operator’s website.

§ 74¹⁵. Electric vehicle recharging point

(1) A distribution network operator engages in cooperation with any undertaking that owns, develops, operates or manages an electric vehicle recharging point.

(2) A distribution network operator may own, develop, operate or manage an electric vehicle recharging point exclusively for its own use or if the all of the following conditions are fulfilled:

1) the Competition Authority has approved the conditions of the public auction mentioned in subsection 5 of this section;

2) the attempt to sell the recharging point to another person by means of a public auction has failed;

3) the operator ensures, on an equal footing, access to third parties to the electric vehicle recharging point that belongs to it.

(3) At least after every five years, a distribution network operator arranges a public consultation to assess the possible interest of other parties to acquire, develop, operate or manage a recharging point for electric vehicles – or a set of such points – that does not meet the conditions provided by subsection 2 of this section.

(4) If, as a result of a public consultation mentioned in subsection 3 of this section, it emerges that there are persons who are interested in acquiring, developing, operating or managing a recharging point for electric vehicles – or a set of such points –, the distribution network operator arranges a public auction to sell such a point or a set of such points within six months following the emergence of the results of the consultation.

(5) The distribution network operator obtains the approval of the Competition Authority for the conditions of the public auction mentioned in subsection 4 of this section. The Authority may, when deciding whether to approve the conditions, take into consideration the residual value of any investments made in the recharging point for electric vehicles, or in a set of such points.

(6) The minister in charge of the policy sector enacts, in the network code on the functioning of the electricity market, rules for the public auction mentioned in subsection 4 of this section.

§ 74¹⁶. Energy storage unit

(1) A network operator may not own, develop, operate or manage an energy storage unit.

(2) In order to sell an energy storage unit that belongs to it, a network operator arranges a public auction and obtains the Competition Authority’s approval for the conditions of such an auction.

(3) As a derogation from subsection 1 of this section, a network operator may own, develop, operate or manage an energy storage unit if it constitutes a fully integrated network component or if all of the following conditions have been fulfilled:

1) an attempt to sell the energy storage unit by way of the public auction mentioned in subsection 2 of this section was not successful;

2) the operator needs the unit for the efficient, reliable and secure functioning of the network and the unit will not be used for purchasing or selling electricity in the electricity market, including for balancing purposes.

(4) To use the derogation provided by subsection 3 of this section, a network operator needs a decision by the Competition Authority.

(5) Where a derogation is granted to the transmission network operator, the Competition Authority notifies the Agency for the Cooperation of European Energy Regulators, stating the particulars of the application and the reasons for granting the derogation.

(6) At least after every five years, the Competition Authority holds a public consultation to assess the potential preparedness and interest of other parties to acquire, on conditions provided by subsection 3 of this section, an energy storage unit belonging to the network operator.

(7) Where it emerges, as a result of a public consultation mentioned in subsection 6 of this section, that there are persons mentioned in that subsection, the network operator holds a public auction within 18 months following the end of the consultation to sell the energy storage unit belonging to it.

(8) Subsections 6 and 7 of this section do not apply to fully integrated network components and to any energy storage units that include a battery, if such units:

1) are integrated into the network;

2) are used exclusively in the case of network emergencies, with restoration commencing without delay when the emergency is discovered and ending immediately when the emergency can be eliminated by ordinary redispatching;

3) are not used for purchasing or selling electricity in the electricity market.

(9) The minister in charge of the policy sector enacts, in the network code on the functioning of the electricity market, rules for the public auction mentioned in subsection 2 of this section.

§ 75¹. Invoice presented to the consumer (järg)

(1) Once a month – unless agreed otherwise with the consumer – the seller presents them an invoice for the electricity consumed. The invoice must be clear, specific and easily comparable. The following information is presented together with the invoice:

1¹) the seller’s name and contact particulars;

1²) the quantity of electricity consumed during the invoicing period, the amount payable and its division into at least the components mentioned in subsection 2¹ of this section;

1³) the due date of the invoice;

1⁴) in the case of an electricity contract for a fixed period with a fixed price, the end date of the contract, if applicable;

1⁵) the unique identifier of the metering point based on which the invoice is issued;

1⁶) where, under the contract between the consumer and the seller, the price of electricity changes, information concerning the change and the date on which it became effective;

1⁷) a reference to a website of a comparison tool trustmarked by the Competition Authority;

1⁸) a reference to the website of the data exchange platform described in subsection 1 of § 42¹ of this Act;

2) the proportion of electricity purchased from a power exchange in the financial year preceding the period of the sale;

3) a reference to a website which provides information concerning the environmental impact caused by emissions of CO2 and SO2, the oil shale ash that must be deposited, and radioactive waste, which were released in the course of producing the electricity supplied by the seller during the financial year preceding the period of the sale;

4) information concerning the consumer’s rights and the options for resolution of disputes;

5) starting 1 April, the volume of electricity which was supplied in the previous calendar year and whose origin was certified by means of guarantees of origin;

6) the volume of supplied electricity whose origin is not certified by means of guarantees of origin, using the residual mix value published by the transmission network operator.

(1¹) When, following the rules provided by the grid code, the network operator rectifies the measurement data of a market participant on the data exchange platform, the seller presents a rectification invoice to the market participant, stating the reason for rectification on the invoice.

(1²) Quantities of electricity net-metered during the trading period are settled for by the network operator and seller of electricity with the producer and consumers.

(2) Where a consumer decides to change the seller, the seller presents its final invoice to the consumer within six weeks following termination of the contract for the sale of electricity. If, after the final invoice has been presented, a fault of the metering system is discovered or the data that have been filed differ from those of actual consumption, the consumer’s metering data are rectified on the data exchange platform and the seller presents an invoice to rectify the final invoice.

(2¹) The invoice presented to the consumer must state, as separate items, the price of electricity, the network charges and any additional charges, taxes and statutory fees in accordance with the terms provided by Regulation (EU) 2016/1952 on European statistics on natural gas and electricity prices and repealing Directive 2008/92/EC (OJ L 311, 17.11.2016, pp. 1–12).

(2²) The seller offers the consumer the option of receiving, by electronic means, the invoices and information presented on these.

(2³) The seller makes it possible for the invoice to be paid by different payment methods and sets flexible rules for payment.

(3) No additional fee is charged for presenting the invoice.

(4) The seller undertakes to employ the services of an auditor to ensure that the invoice issued to the consumer for the electricity supplied, and any other advertising materials that are mentioned in subsection 1 of this section and that are disseminated by the seller, reflect the correct distribution of the energy sources used in the generation of electricity during the financial year that preceded the period of the sale. The role of the auditor is to verify whether the volume of renewable energy used (a per centage value) stated by the seller in the information it presents to the consumers is supported by guarantees of origin that have been notified to the transmission network operator as guarantees of origin used for certifying to the consumers the origin of the electricity supplied.

(5>) At the consumer’s request, the seller provides them an explanation of how their invoice has been drawn up.

§ 76¹. Universal service

(1) A small consumer has a right to purchase electricity from the network operator to whose network their electrical installation is connected, for a price which is reasonable and justified and which conforms to the principle of equal treatment (hereinafter, ‘the universal service’).

(2) The network operator provides the universal service itself or, where it does not engage in the sale of electricity, arranges a public procurement procedure to find a seller to provide the service, without giving preference to any undertaking with which it is connected.

(2¹) Where finding a seller of electricity by means of public procurement fails, the distribution network operator designates a temporary seller of electricity until the time that the seller of electricity is found by means of new public procurement.

(2²) The new public procurement procedure mentioned in subsection 2¹ of this section must be arranged without delay.

(2³) The seller of electricity designated in a situation mentioned in subsection 2¹ of this section must assume providing the service if the designator is a distribution network operator with more than 100,000 consumers, who is not allowed to provide the service of sale, and the seller of electricity holds the largest market share at the time of designation.

(3) Where a network operator does not itself provide the universal service, such an operator publishes on its website the name and contact information of the seller who provides that service in the operator’s service area and provides that information to any person who requests it.

(4) It is not obligatory to provide the universal service to a consumer whose network contract, which was concluded under § 83 of this Act, has been cancelled on a ground provided by this Act.

(5) Where a small consumer has not concluded an electricity contract under § 83 of this Act with any seller of electricity, such a consumer is provided the universal service as of the day following the day of termination of their electricity contract.

§ 76². Standard terms and conditions of universal service

(1) Where the seller to provide the universal service has not been found by means of a public procurement arranged under subsection 2 of § 76¹ of this Act, the network operator obtains the approval of the Competition Authority for the standard terms and conditions of such service. The Competition Authority does not approve the standard terms and conditions if a standard term contravenes this Act or if the content or manner of expression or of presentation of the term is unusual or difficult to understand within the meaning of subsection 3 of § 37 of the Law of Obligations Act, or if the term is unfairly prejudicial to the other party within the meaning of § 42 of that Act.

(2) The network operator and the seller found by means of a public procurement arranged under subsection 2 of § 76¹ of this Act publish on their website the standard terms and conditions mentioned in subsection 1 of this section on their website and provide information concerning these to any person who requests it.

§ 76³. Price of electricity sold under the rules of universal service

(1) The provider of the universal service calculates the price, for a given calendar month, of electricity sold under the rules of the universal service based on the weighted average of the hourly amounts of electricity sold under such rules in that calendar month correlated with the hourly prices of electricity published at the power exchange. Justified costs related to the provision of the universal service and a reasonable operating margin are added to the price calculated according to this method.

(1¹) The provider of the universal service calculates the price, for the calendar month, of electricity sold under the rules of the universal service to a consumer receiving that service such that it adds, to the production cost applicable during that month, the justified cost of provision of the service and a reasonable business profit. The provider publishes the price on its website.

(2) The provider of the universal service calculates the charge for the universal service based on metered amounts of electricity consumption. Where the network operator does not possess metered data concerning a small consumer’s consumption of electricity during the previous calendar month, the operator makes an estimate of the amount of electricity required for provision of the universal service based on a consumption schedule. Where accurate information is subsequently received, and where the estimated amount differs from the metered amount, the network operator sets off the account on the invoice for the next month.

(3) The provider of the universal service publishes, on its website, by the ninth day of the following month, the price of electricity sold under the rules of the universal service together with the data and method of calculation used to arrive at the price.

(4) The rules for setting off amounts of electricity consumed under the rules of the universal service, for the exchange of information in relation to the universal service and for providing information to small consumers are established in the network code on the functioning of the electricity market.

§ 76⁴. Sale of electricity in micro isolated networks

(1) Once a month at the latest on the 15th day of the month the distribution network operator in whose service area the micro isolated network is located presents to the producer subject to the production obligation mentioned in § 55¹ of this Act the data concerning the quantity of electricity taken from the network and the quantity of electricity fed into the network separately for each open supplier holding an open supply contract.

(2) If the total quantity of electricity taken from the network and of electricity fed into the network at all metering points of the market participants of the micro isolated network is greater than zero, the open supplier that concluded electricity sale contracts with those participants purchases electricity from the producer subject to the production obligation.

(3) If the total quantity of electricity taken from the network and of electricity fed into the network at all metering points of the market participants of the micro isolated network is less than zero, the producer subject to the production obligation purchases electricity from the open supplier that concluded electricity sale contracts with the market participants of the micro isolated network.

(4) The charge for the electricity mentioned in subsections 2 and 3 of this section is calculated based on hourly rates of the power exchange.

§ 81¹. Filing of data with Statistics Estonia

An electricity undertaking files the data concerning the setting of the price of electricity or of network services to Statistics Estonia according to the rules established in the Official Statistics Act.

§ 81². Preservation of data

A seller preserves, for at least five years from conducting the transaction, the following data – to be presented the Competition Authority and the European Commission, if required –concerning all electricity transactions with another seller and with the transmission network operator, as well as concerning all transactions based on derivatives within the meaning of points 5–7 of Part C of Annex I of Directive 2014/65/EU of the European Parliament and of the Council on markets in financial instruments and amending Directives 2002/92/EC and 2011/61/EU (OJ L 173, 12.06.2014, pp. 349–496) which are related to electricity and whose underlying asset is electricity:

1) the date of the transaction and the terms and conditions of supply and of payment;

2) the amount of the transaction;

3) the date and time that the transaction was performed, by trading period;

4) the price of the transaction;

5) the particulars of the buyer;

6) details concerning supply agreements.

§ 82. Import of electricity

(1) Electricity may be imported by the system operator or by a power exchange trader. A power exchange trader may only import electricity for sale at the power exchange.

(2) A power exchange trader who intends to import electricity may require the system operator to provide an assessment regarding whether the intended import of electricity is permissible considering the technical parameters of the system.

(3) An importer of electricity who is not a balance provider enters into an open supply contract with a balance provider in order to maintain its balance.

(4) The system operator may restrict or interrupt the import of electricity if this is required by the technical limitations of the system or the need to ensure the security of supply.

(5) The system operator may refuse to provide network services for the import of electricity if the importer of electricity fails to comply with the requirements established in the legislation concerning the import of electricity.

(6) Every three months, the system operator transmits to the European Commission information concerning the amounts of electricity actually fed into the system from third countries.

§ 82¹. Comparison tool

(1) Household consumers and companies that have fewer than 10 employees and whose annual balance sheet volume does not exceed two million euros, whose estimated annual electricity consumption is less than 100,000 kWh must have access to at least one trustmarked tool by which they can compare sellers’ offers.

(2) The seller notifies the consumer on the electricity sales invoice of all available trustmarked comparison tools created by the system operator.

(3) A comparison tool must meet the following requirements:

1) it is independent of market participants and ensures equal treatment of electricity undertakings;

2) it provides clear information on the party operating and on the party verifying the tool, as well as on the source of funding for the creation and operation of the tool;

3) it lays out clear and objective criteria for its comparisons of offers;

4) it states information in clear and unambiguous wording;

5) it provides precise and up-to-date information and states the time of its last update;

6) it is also accessible to disabled persons;

7) it allows the operator to be notified, in an efficient manner, of any incorrect information displayed by the tool;

8) it limits its queries for personal data to those that are required in order to compare the offers.

(4) The Competition Authority issues a trust mark to a comparison tool that meets the requirements provided by subsection 3 of this section.

(5) The Competition Authority conducts periodical verifications to ascertain whether a trustmarked comparison tool continues to meet the requirements provided by subsection 3 of this section.

(6) The minister in charge of the policy sector enacts, in the network code on the functioning of the electricity market, the information that a seller must transmit to the operator of a trustmarked comparison tool created by the system operator – by the method and by the due dates required by the operator of the tool.

§ 83. Application of provisions

(1) The provisions of this Chapter apply to contracts which are made with a network operator for connection to its network and for amending the consumption or generation conditions (hereinafter, ‘connection contracts’), to contracts which are made for the provision of any other network services (hereinafter, ‘network contracts’) as well as to electricity contracts and a contract concluded for aggregation (hereinafter, ‘aggregation contracts’).

(2) Derogation from the provisions of this Chapter is permitted by agreement of the parties. Any agreement to make a derogation which is detrimental to an individual consumer is void.

(3) To the extent not regulated by this Act, connection contracts, network contracts, electricity contracts and aggregation contracts are subject to the provisions of the Law of Obligations Act.

§ 84. Form of contract

(1) Electricity contracts may be made by oral agreement. Where a party to the electricity contract so requests, the contract is concluded in writing, in a form reproducible in writing or in an electronic form.

(2) Connection contracts, network contracts and aggregation contracts are concluded in writing, in a form reproducible in writing or in electronic form.

(3) A network operator may conclude separate network contracts with the consumer regarding different network services.

(5) A consumer and an active user of network services are entitled to conclude an aggregation contract without the consent of the seller of electricity. With respect to the conclusion of an aggregation agreement, the aggregator files a notice with the system operator following the method provided by the network code on the functioning of the electricity market.

§ 85. Provision of information

(1) Prior to entering into a connection contract, network contract, electricity contract or aggregation contract, the party to the contract who is a natural person and a consumer must be provided with information concerning the principal terms and conditions of the contract as well as concerning any possible alternatives in terms of its substance – to the extent and following the rules corresponding to the obligation to provide pre-contractual information as required by the Law of Obligations Act or any other Act of the Riigikogu.

(3) If, by agreement with a network operator, a seller also arranges settlement of accounts for the network services provided by the network operator under a network contract, the seller presents a separate invoice for the network services provided or distinguishes the relevant date related to network services in the invoice issued under the electricity contract.

§ 86. Written confirmation

(1) If an electricity contract is not made in writing, in a form reproducible in writing or in an electronic form, the distribution network operator or seller, having concluded the contract, sends a written document to the consumer confirming the substance of the contract (hereinafter, ‘written confirmation’).

(2) A written confirmation states the period of time during which the consumer may file objections. Such a period must not be shorter than three weeks.

(3) During the period from the making of a contract to expiry of the period of time mentioned in subsection 2 of this section or until objections are filed within that period, the parties observe the terms and conditions stated in the written confirmation, unless agreed otherwise.

(4) In matters not regulated by this section, written confirmations are subject to the Law of Obligations Act.

(5) This section does not apply to consumers who are natural persons.

§ 87. Terms and conditions of contract

(1) A connection contract, network contract, electricity contract or aggregation contract that is executed in writing or in a form reproducible in writing or in an electronic form includes the following information:

1) the name, registration number in the Commercial Register or the personal identification number, address and email address of the network operator in the case of a network or connection contract or of the network operator or seller in the case of an electricity contractor of the aggregator in the case of an aggregation contract;

2) a description of the services provided under the network, connection or aggregation contract or the principal parameters of the electricity sold under the electricity contract;

3) the principal parameters of the quality of the services provided under the network, connection or aggregation contract or a reference to a document which is accessible and which states such parameters;

4) the time of initial connection to the network under a connection contract concluded for connection to the network or for modification of the consumption or generation conditions;

5) a description of the maintenance services provided;

6) the method by which relevant information may be obtained concerning the charges payable under the contract;

7) the conditions for amendment of the contract and of the conditions for the provision of services under the contract, and the conditions for cancellation of the contract, including the conditions for cancelling the contract without charge;

8) if the services provided under a network or connection contract do not conform to the terms and conditions of the respective contract, information concerning the way in which the consumer may obtain a refund or compensation, by means of a payment or by other means;

8¹) where delivery of an invoice presented under a network or electricity contract is delayed, or where an incorrect invoice is presented due to an error of the network operator or seller, or where an advance payment has been made by the consumer, information concerning the way in which the consumer may obtain a refund, set-off, payment of compensation or compensation by other means;

8²) where charges are payable under a contract, at least two different payment options;

9) information concerning the handling of complaints, including information on the rights of the consumer in relation to alternative dispute resolution under the Consumer Protection Act, and on the right, in situations provided for by subsection 1 of § 99, to file a complaint with the Competition Authority;

10) in the case of a network or electricity contract, the contract period.

(1¹) Before conclusion of the electricity contract, the seller of electricity provides the consumer wishing to conclude the contract with a summary of the same, which includes at least the following information:

1) the terms of amending and cancelling the contract;

2) the total price of electricity and its breakdown by cost components;

3) information on whether the price is fixed or dynamic;

4) the seller’s e-mail address and contact particulars of the Consumer Disputes Committee;

5) information on one-off payments, markdowns, additional services and discounts.

(2) Where an electricity contract has not been concluded in writing, in a form reproducible in writing or in an electronic form, the information mentioned in subsection 1 of this section is provided in the written confirmation to be issued by the distribution network operator or seller under § 86 of this Act. The information is issued to a consumer who is a natural person according to the rules provided by the Law of Obligations Act.

(3) No fee may be charged for conclusion of an electricity or aggregation contract from a household consumer or from a company that has fewer than 50 employees and whose annual turnover and balance sheet volume do not exceed 10 million euros.

(6) A seller of electricity who serves at least 200,000 consumers must, where the consumer requests this, offer them an electricity contract with dynamic pricing and a fixed-price electricity contract for a specified period that must run for at least one year.

(7) Before conclusion of the electricity contract, the seller of electricity notifies the consumer of the options, cost and risks related to the contract.

§ 87¹. Terms and conditions of generation-oriented connections

(1¹) The transmission network operator and the network operator holding the relevant authorisation may cancel the connection contract concluded with the distribution network operator holding the relevant authorisation to the extent of any generation capacity that was not connected to the network within the period mentioned in subsection 4 of this section.

(4) The period prescribed for commencement of generation is one year where solar panels are to be installed, three years where an offshore wind farm is to be installed and two years for other technologies. The period for commencing generation is counted from the due date for completion of the connection point or from the time of completion of the connection to the network and of the works that are stipulated in the connection contract and that are needed to make it possible to use the full generation-oriented connection capacity of the generating installation.

(4¹) In the case of solar panels, the period for commencing generation may be longer than the period prescribed by subsection 4 of this section, provided installation of the panels is related to a construction work whose completion is a prerequisite for such installation. The aforementioned period may be extended by the time that, at the time of filing the application for connection, remains to run until the due date for completion of the construction work.

(4²) The extension – provided for by subsection 4¹ of this section – to be granted for commencing generation may not exceed three years.

(5) The technology for the generation of electricity that is stated in the connection application must not be changed, except where the change does not entail an increase in the generation-oriented capacity stipulated in the connection contract, and the new technology is the generation of electricity based on the combustion of fuel, on hydrogen or on storage. Changing the technology does not change the period prescribed by subsection 4 of this section for commencing generation or the time from which the counting of the period starts.

(5¹) Adding another technology to the one mentioned in the connection application does not count as a change of technology unless it entails an increase in the generation-oriented capacity stipulated in the connection contract.

(5²) In areas and in situations where due to restrictions stemming from national defence it is not allowed to install the technology stated in the connection application, that technology may be changed. The technology may be changed, provided use of such technology does not contravene restrictions stemming from national defence that have been established for the area.

(6) Where the market participant that concluded a generation-oriented connection contract has not, by the time the period mentioned in subsection 4 expires, used at least 95 per cent of the capacity provided for by the contract, they pay a fee to the network operator one year after the expiry of the period in the amount corresponding to the capacity of the generation-oriented network connection that is not being used. The fee is applied each time a year is completed during which the market participant did not use at least 95 per cent of its generation-oriented capacity stipulated in the connection contract. The amount equals 38,000 euros per megavolt-ampere per year and is calculated based on the difference obtained by subtracting actually attained generation capacity from the capacity corresponding to 95 per cent of contractually stipulated capacity. Where the market participant that concluded the connection contract in the distribution network has transferred the generating installation or site of consumption, the fee is charged to the owner of the item of immovable property. Where the generation capacity stipulated in the connection contract of the market participant that has connected to the distribution network has been commissioned in part, the fee for 95 per cent of the capacity stipulated in the connection contract is applied by virtue of subsection 7 of this section.

(6¹) When the period mentioned in subsection 4 of this section has elapsed, the fee provided for by subsection 6 of this section is applied to generating installations whose net capacity exceeds 100 MW to the extent of 30 per cent in the first year and 60 per cent in the second year, provided at least 50 per cent of the capacity stipulated in the connection contract was used in the first year.

(6²) The network operator postpones application of the fee provided for by subsection 6 of this section if generation has not commenced due to reasons – for which evidence is provided – that are beyond the producer’s control, until such reasons are no longer operative, or states the reasons for refusal to postpone. The producer is obligate to notify the network operator without delay when the reasons are no longer operative.

(6³) The fee provided for by subsection 6 of this section is not applied to creation of a generation-oriented connection between network operators holding the relevant authorisation – unless they have connected to the network as a producer.

(6⁴) The fee mentioned in subsection 6 of this section does not apply in the case of generating installations with a net capacity of up to 15 kW.

(6⁵) The distribution network operator may apply the fee mentioned in subsection 6 of this section as calculated based on the calendar year.

(7) A market participant who has concluded a generation-oriented network contract and who, for the last two years starting from the end of the period mentioned in subsection 4 of this section, has not used at least 95 per cent of the generation-oriented capacity stipulated in the contract, pays a fee to the network operator corresponding to the capacity of the generation-oriented network connection that is not being used in accordance with the amount mentioned in subsection 6 of this section. The fee is not applied to the part of unused generation-oriented network connection capacity that is related to participation in the reserve capacity mechanism mentioned in subsection 1 of § 42² or in the island operation capability service mentioned in subsection 2 of § 42⁵ of this Act or that is needed to perform a long-term frequency reserve contract concluded with the system operator or a technical cooperation and security of supply contract concluded with that operator.

(7¹) When the initial two-year period mentioned in subsection 7 of this section has elapsed, the fee – in the amount referred to in the same subsection – is applied for each following year during which the market participant did not use at least 95 per cent of the generation-oriented capacity stipulated in its network contract. The aforementioned fee is not applied to creation of a generation-oriented connection between network operators holding the relevant authorisation – unless they have connected to the network as a producer.

(7²) The fee mentioned in subsection 7 of this section is applied to market participants in the transmission as well as distribution network who, at the time the fee is applied, are a party to the network contract. Where, at the time the fee is applied, the market participant in the distribution network does not have a network contract that is in effect, the fee is applied to the market participant mentioned in subsection 6 of this section.

(7³) The fee mentioned in subsection 7 of this section does not apply in the case of generating installations with a net capacity of up to 15 kW.

(7⁴) The distribution network operator may apply the fee mentioned in subsection 7 of this section as calculated based on the calendar year.

(8) Use of generation-oriented capacity is deemed to be made when the generation-oriented network connection capacity that is provided for by the connection or network contract is transmitted from the connection point in the direction of the network operator’s network, and the transmission is registered by the network operator’s metering equipment based on which the amount of generation-oriented capacity that was used is ascertained.

(9) Where the person who concluded the generation-oriented connection or network contract does not, by the due date, pay the fee mentioned in subsection 6 or 7 of this section, the network operator does not guarantee to the market participant – to the extent they have not used the generation-oriented capacity that was agreed in the connection or network contract – a connection to the network. Where the generation capacity that was stipulated in the network contract has not been commissioned, the network operator has a right, in the network contract, to unilaterally reduce the generation capacity or revoke the generation conditions of the contract. To restore the generation-oriented capacity that is needed at the connection point, the market participant files a new connection application.

(10) The funds paid under subsections 6 and 7 of this section are used by the network operator to cover the costs of investment related to increasing the capacity of its network. The network operator keeps a separate account of the fees received and of their use.

§ 88. Validity and period of contract

(1) A network contract, electricity contract or aggregation contract may be made for an unspecified or for a specified period. A connection contract is made for establishing a network connection as defined in the contract or for modification of the consumption or generation conditions of an existing network connection, and terminates when it has been performed.

(2) An electricity contract which is made for an unspecified period terminates with the termination of the network contract concluded in respect of the network connection through which electricity was sold under the electricity contract.

(3) An electricity contract may be concluded by a market participant who holds a valid network contract in respect of the metering point of his place of consumption.

(4) A seller of electricity or an aggregator makes it possible for a consumer to conclude a contract for the sale of electricity free of charge or a contract for the sale of electricity for a specific period subject to premature cancellation for a fee.

(4¹) A household consumer or a company that has fewer than 50 employees and whose annual turnover and balance sheet volume does not exceed 10 million euro – of which the seller of electricity has been notified prior to conclusion of the contract – may not be charged a fee for changing the seller, with the exception of situations provided for by subsection 5 of this section.

(5) A seller of electricity or an aggregator may charge a household consumer or a company that has fewer than 50 employees and whose annual turnover and balance sheet volume does not exceed 10 million euro a fee for premature termination of the electricity or aggregation contract concluded for a specific period, provided the fee is prescribed by the contract concluded with the consumer and the consumer was notified of the fee prior to conclusion of the contract. The fee for termination of the contract must be proportionate and must not exceed the direct financial harm that termination entails for the seller or aggregator. The duty to prove direct financial harm lies on the seller or aggregator.

(6) A household consumer may cancel an electricity contract concluded for a specified or an unspecified period – or an aggregation contract – giving 14 days’ notice of the cancellation.

§ 89. Amending the contract

(1) The network operator may unilaterally amend the standard terms and conditions of a network contract and the network operator or a seller designated by the network operator may unilaterally amend the standard terms and conditions of the universal service if such amendments are objectively justified and necessary in order to take into account a change in the circumstances and provided the amendments have been approved by the Competition Authority. The Competition Authority does not accept any amendments to standard terms and conditions if the substance, wording or presentation of a standard term or condition is uncommon or unintelligible within the meaning of subsection 3 of § 37 of the Law of Obligations Act or if a standard term or condition is unfairly prejudicial to the other party within the meaning of § 42 of that Act.

(2) A network operator may unilaterally amend the network charge or any other charge stipulated in the network contract if such an amendment has been approved by the Competition Authority.

(3) The amendment of the standard terms and conditions mentioned in subsection 1 of this section applies to all contracts which are valid at the time of amendment and which are concluded subsequently.

(3¹) Where the need to amend the terms and conditions of the electricity or aggregation contract arises from amendments to legislation, the seller may unilaterally amend those terms and conditions.

(4) Before amending the terms and conditions of the contract, the network operator or seller transmits a corresponding notice to the consumer. The notice states the envisaged amendments, the grounds for those amendments, the date on which they are to take effect, and information concerning the fact that the consumer has a right to cancel the contract if they do not accept the amendments.

(5) The notice mentioned in subsection 4 of this section is provided to the consumer together with the invoice presented to them – or in writing to the address provided by the consumer – at least 30 days before the envisaged amendments are to take effect.

(7) To change a consumer’s fixed-price electricity contract into a dynamically priced one, the seller of electricity must obtain an express consent from the consumer.

§ 90. Interruption of network connection for reasons due to the consumer

(1) The network operator may interrupt the consumer’s connection to the network if the consumer has failed to pay the amount payable for the network or universal service provided to the consumer or for the open supply provided by the network operator to the consumer in the event of an interruption in the open supply chain, or if the consumer has otherwise materially breached an obligation arising from the network contract.

(2) Before interrupting the network connection on the grounds mentioned in subsection 1 of this section, a corresponding notice is sent to the consumer at the address of the place of consumption or the address stated in the contract. The notice states the grounds for interrupting the network connection, the scheduled time of the interruption and information regarding the rights of the consumer and the options available for the resolution of disputes as well as information on options other than disconnecting the place of consumption from the network.

(2¹) The information on options other than disconnecting the consumer from the network must include at least the following information:

1) the options provided for by the Social Welfare Act;

2) the possibilities for saving electricity or a reference to websites containing such information;

3) alternative payment options;

4) where the network operator allows this, the options for limiting the capacity of the network connection.

(3) To a consumer who is a natural person, the notice mentioned in subsection 2 of this section is transmitted in writing to a contact address provided by the consumer.

(4) The network connection of the consumer may be interrupted provided the consumer has failed to eliminate the circumstances which serve as grounds for the interruption, or fails to notify the network operator of the elimination, within fifteen days after the notice mentioned in subsection 2 of this section was sent.

(5) Where the failure of an individual consumer to pay an amount payable for the network or universal service provided to them is due to their temporary insolvency which was brought about as a result of a serious illness or loss of employment, the consumer may notify the network operator of such circumstances in writing. The corresponding notification must include evidence certifying the circumstances.

(6) After receiving the notification and the evidence mentioned in subsection 5 of this section, the network operator may interrupt the network connection of an individual consumer provided the consumer has failed to eliminate the circumstances which serve as grounds for the interruption, or fails to notify the network operator of the elimination, within 30 days after the notice mentioned in subsection 2 of this section was sent.

(7) If an individual consumer has failed to pay the amount charged for the network or universal service provided to the consumer, that consumer’s network connection may, during the period from 1 October to 30 April and in a building or part of a building which constitutes a dwelling and which is used as a permanent residence and heated exclusively or primarily by electricity, or in which the use of electricity is unavoidable for the functioning of the heating system that exclusively or primarily uses another fuel source, be interrupted provided the consumer has, within 90 days after the notification mentioned in subsection 2 of this section was sent, failed to eliminate the circumstances which serve as grounds for the interruption, or fails to notify the network operator of the elimination.

(8) It is not contrary to subsection 7 of this section for the network operator to install and use a special protective device to limit the capacity of the network connection of a consumer if the consumer has failed to pay the amount payable for the network or universal service provided to that consumer, or has otherwise materially breached an obligation arising from the network contract. The consumer is given at least 15 days’ notice of such a limitation following the rules provided by subsections 2 and 3 of this section.

(9) It is not contrary to subsections 1–7 of this section for the network operator to interrupt, without delay, the network connection of a consumer if the consumer:

1) increases, without permission, the capacity limited following the rules provided by subsection 8 of this section;

2) uses electricity or network services unlawfully within the meaning of § 68 of this Act;

2¹) feeds electricity into the network without a contract concluded with the network operator;

3) uses electrical installations which do not meet established requirements, which are dangerous or which interfere with the functioning of the network as a whole or which jeopardise the security of supply.

(10) Interruption of the network connection on the grounds mentioned in this section does not release the consumer from the obligation to pay the charges stipulated in the connection contract, electricity contract, network contract or aggregation contract.

(11) The network operator may require the consumer to reimburse justified costs incurred in implementing the measures provided for by this section.

(12) The provisions of subsections 1, 2 and 8–11 of this section also apply to interruption of a network connection and limitation of the capacity of the network connection of a producer, line possessor or another network operator.

(13) The provisions of this section also apply in situations in which electricity is conveyed and sold in accordance with clause 1 or 2 of subsection 6 of § 15 of this Act.

§ 91. Cancellation of network contract

(1) A network operator may cancel a network contract and disconnect the place of consumption from the network if:

1) the network connection has been interrupted by the network operator due to a breach of the network contract and the interruption has lasted at least 180 consecutive days and the other party to the contract has failed, during that period, to eliminate the circumstances which served as grounds for the interruption and has not commenced consumption of electricity;

2) the other party to the contract has materially breached the obligations arising from the network contract and has failed to remedy the breach within a reasonable period of time granted by the network operator, in view of which the network operator cannot reasonably be expected to continue performing the contract.

(2) The network operator may cancel a network contract for failure to pay an amount payable under the contract concluded with the network operator or seller only on the grounds provided by clause 1 of subsection 1 of this section.

(3) The network operator provides at least thirty days’ notice of the cancellation of a network contract. The notice states the grounds for the cancellation and the date of termination of the contract.

(4) To a consumer who is a natural person, the notice mentioned in subsection 3 of this section is transmitted in writing to a contact address provided by the consumer.

(4¹) A network operator may cancel the network contract before the agreed due date or before the notice period mentioned in subsection 3 of this section has expired, if the place of consumption stipulated in the contract has been the subject of a transfer of property and there is no legal basis for the consumer to use that place.

(4²) The distribution network operator whose service area includes an immovable that the operator owns, and who terminates its operations within the meaning of subsection 9 of § 65 of this Act and wishes to continue to convey and sell electricity on the conditions provided for by clause 1 of subsection 6 of § 15 to a consumer located on that immovable, may cancel the network contract concluded with that consumer provided a corresponding arrangement has been reached.

(5) A person who has concluded a network contract with a network operator may not cancel the contract if a valid electricity contract concluded with another person exists in respect of the network connection that is the subject matter of the network contract and if the other person has not concluded a network contract regarding the network connection.

(6) A consumer may cancel a network contract made for a specified or unspecified period provided they give at least 30 days’ notice of the intention to cancel. This provision does not apply in a situation mentioned in subsection 5 of this section.

(7) Any agreement which derogates from the provisions of this section is void.

§ 92. Cancellation of electricity contract

(1) The seller is entitled to cancel the electricity contract if:

1) the consumer has materially breached obligations arising from the contract and has not remedied the breach within a reasonable period of time granted by the seller;

3) the consumer has used electricity unlawfully or has intentionally or due to gross negligence damaged the seals or verification marks placed on the metering devices;

(3) A consumer must be notified of the cancellation of an electricity contract at least thirty days in advance. The notification states the grounds for cancellation of the contract and the date of its termination.

(4) To a consumer who is a natural person, the notice mentioned in subsection 3 of this section is transmitted in writing to a contact address provided by the consumer.

(4¹) A seller may cancel an electricity contract before the agreed due date, or before the notice period mentioned in subsection 3 of this section has expired, if the place of consumption stipulated in the contract has been the subject of a transfer of property and there is no legal basis for the consumer to use that place.

§ 92⁴. Statistical transfers of energy

(1) The State may carry out statistical transfers of energy produced from a renewable source to another Member State of the European Union and conclude, for that purpose, the relevant agreements, having regard to the obligation of achieving the proportion, in the final consumption, of energy produced from a renewable source as provided for by Directive 2009/28/EC of the European Parliament and of the Council.

(2) The agreement is notified to the European Commission at the latest three months after the end of the year during which that agreement is in effect. The relevant notification must include information concerning the amount of statistically transferred energy that was the subject of the agreement, the particulars of the parties to the agreement and the cost of the agreement. The statistical transfer of energy takes effect after notification has been made to the European Commission.

(3) The transmission network operator transmits to the minister in charge of the policy sector the information required for concluding the agreement.

(4) The sums paid under the agreement by another Member State of the European Union are received by the transmission network operator and are, except where the agreement on the cooperation mechanisms of renewable energy provides otherwise, deducted from the cost of funding, in the next calendar year, the transmission network operator’s support to be awarded under subsection 4 of § 59² of this Act for electricity produced from a renewable source and for electricity produced in a high-efficiency cogeneration process.

§ 92⁵. Cooperation projects with other Member States

(1) Energy that has been produced from a renewable source by a new generating installation that is located in Estonia and that, for the first time, commenced operation after 25 June 2009, or that has been produced by capacity that was added after 25 June 2009 as a result of renovation of a generating installation located in Estonia, may be subtracted from the amount of energy produced from a renewable source that is taken into account when assessing attainment of the objectives provided in respect of Estonia in Annex I of Directive 2009/28/EC of the European Parliament and of the Council, and added to the amount of energy produced from a renewable source that is taken into account when assessing attainment of the objectives provided by the same Annex in respect of the other Member State participating in the cooperation project.

(2) Generating installations that may not participate in cooperation projects are:

1) installations that produce electricity for which the producer is paid the support provided by this Act for electricity produced from a renewable source;

2) installations that produce electricity for which the producer, for the period provided by § 108 of this Act, has been paid the support provided by this Act for electricity produced from a renewable source;

3) installations for the building or renovation of which the State has granted the producer investment support that the owner of the installation does not reimburse to the State.

(3) The cooperation project may not interfere with the attainment of the proportion of energy produced from a renewable source as provided by Annex I of Directive 2009/28/EC of the European Parliament and of the Council.

(4) The producer notifies its wish to participate in a cooperation project to the Ministry of Climate. The notification must contain:

1) a description of the envisaged or renovated generating installation, or of a generating installation undergoing renovation;

2) the name of the other Member State of the European Union that participates in the cooperation project and the contact details of the competent authority;

3) the time period in calendar years during which the amount of energy that is produced from a renewable source and that constitutes the subject of the cooperation project is to be added to the amount of energy produced from a renewable source that is taken into account when assessing attainment of the objectives provided in respect of the other Member State of the European Union participating in the cooperation project in Annex I of Directive 2009/28/EC of the European Parliament and of the Council;

4) the amount of energy produced from a renewable source by a generating installation mentioned in clause 1 of this subsection, as an absolute value by calendar years or as a proportion of the energy that is produced by means of that generating installation and that is taken into account when assessing attainment of the objectives provided in respect of the other Member State of the European Union participating in the cooperation project in Annex I of Directive 2009/28/EC of the European Parliament and of the Council;

5) where this is possible, confirmation by the competent authority of the other Member State of the European Union, as mentioned in clause 2 of this subsection, to the effect that that Member State agrees to the content of the notification and wishes to present to the European Commission the joint notice mentioned in subsection 6 of this section on the conditions indicated in that notification.

(5) In situations where this is justified, the minister in charge of the policy sector may require supplementary particulars to be filed in addition to the particulars provided for by subsection 4 of this section.

(6) After it has received the notification mentioned in subsection 4 and the supplementary particulars mentioned in subsection 5 of this section, the minister in charge of the policy sector makes a proposal to the competent authority of the relevant Member State of the European Union to present to the European Commission a joint notice, containing the particulars provided by subsection 4, with respect to the cooperation project.

(7) If the Member State of the European Union agrees to the proposal mentioned in subsection 6 of this section, or has agreed to the content of the proposal in accordance with clause 5 of subsection 4, the minister in charge of the policy sector, together with the competent authority of the relevant Member State, presents to the European Commission a joint notice, containing the particulars provided by subsection 4, with respect to the cooperation project.

(8) The support provided by this Act for electricity produced from a renewable source will not be paid for the amount of energy that is to be added to the amount of energy produced from a renewable source which will be taken into account when assessing attainment of the objectives provided in respect of the other Member State of the European Union participating in the cooperation project in Annex I of Directive 2009/28/EC of the European Parliament and of the Council.

(9) Within three months after the end of each calendar year falling in the period mentioned in clause 3 of subsection 4 of this section, the minister in charge of the policy sector notifies to the European Commission and to the Member State mentioned in clause 2 of subsection 4 the amount of energy produced from a renewable source by the generating installation mentioned in clause 1 of subsection 4 during the last calendar year, and the amount of energy that is to be added to the amount or energy produced from a renewable source which will be taken into account when assessing attainment of the objectives provided in respect of the other Member State of the European Union participating in the cooperation project in Annex I of Directive 2009/28/EC of the European Parliament and of the Council.

§ 94. Special measures of regulatory enforcement

(1) When carrying out the regulatory enforcement tasks provided by this Act, the Competition Authority may use the special measures of regulatory enforcement provided by §§ 30, 50 and 51 of the Law Enforcement Act on the grounds and following the rules provided by that Act.

(2) When carrying out the regulatory enforcement tasks provided by this Act, the Rescue Board may use the special measures of regulatory enforcement provided by §§ 30, 32, 49, 50 and 51 of the Law Enforcement Act on the grounds and following the rules provided by that Act.

§ 94¹. Functions of Competition Authority in assessing compliance with established requirements by the transmission network operator

(1) The Competition Authority monitors compliance of the transmission network operator with the requirements established in § 18¹ of this Act and, under § 26¹, undertakes an assessment of such compliance when:

1) it has received a notice mentioned in subsection 4 of § 16 of this Act;

2) it has become aware that an envisaged change in the rights or influence of a person who enjoys control over the transmission network operator may result in infringement of the requirements established in § 18¹ of this Act or when it has reason to believe that such an infringement has already taken place;

3) it has become aware of circumstances which permit a citizen of a third country or a legal person incorporated and registered in a third country to acquire control over the transmission network operator;

4) the European Commission has filed a reasoned request.

(2) The Competition Authority informs the European Commission without delay of any circumstances which permit a person from a third country to acquire control over the transmission network operator, and of the fact that the transmission network owner or transmission network operator controlled by a person from a third country has applied for the authorisation mentioned in clause 3 of subsection 1 of § 22 of this Act.

(3) Where an assessment of compliance with established requirements is initiated in respect of the transmission network operator under circumstances mentioned in clause 3 of subsection 1 of this section, the Competition Authority requires the operator to provide evidence showing that the activity of the operator or of the person controlling the operator does not jeopardise the security of supply of the Republic of Estonia or the European Union.

(4) In assessing the security of supply mentioned in subsection 3 of this section, the Competition Authority takes into account:

1) the rights and obligations which the European Union has in respect of the relevant third country and which emanate from international law, including a security of supply arrangement which has been agreed with one or more third countries and which the European Union is a party to;

2) the rights and obligations which the Republic of Estonia has in respect of the relevant third country and which emanate from any arrangements entered into with the third country as long as they do not conflict with the law of the European Union;

3) other circumstances related to the assessment of compliance with established requirements and to the relevant third country.

(5) If the Competition Authority makes a negative decision in respect of the assessment of the compliance with established requirements that has been initiated under circumstances mentioned in clause 3 of subsection 1 of this section and that decision differs from the opinion of the European Commission, the Competition Authority publishes its decision in the Official Journal together with the reasons for the decision and with the opinion of the European Commission.

§ 94². Special rules regarding regulatory enforcement

The Competition Authority may, under the conditions provided by § 50 of the Law Enforcement Act, only enter the market participant’s premises, rooms or civil engineering works.

§ 95. Compliance notice

(4) In the event of failure to perform an obligation imposed by a compliance notice, a compliance levy may be imposed following the rules provided by the Substitutional Performance and Compliance Levies Act. The upper limit for such a levy is 1,300 euros. In the event of failure to comply with the requirements established in § 18¹ of this Act, the upper limit for a compliance levy applied in respect of the transmission network operator is nine million euros, and the total amount of compliance levies which may be imposed in order to achieve the goal prescribed in the compliance notice may not exceed nine million euros.

§ 99. Resolution of complaints

(1) A market participant may file a written complaint with the Competition Authority against the action or omission of another market participant which is in conflict with this Act or the legislation enacted under it.

(2) The Competition Authority reviews a complaint mentioned in subsection 1 of this section and makes a decision on it within thirty days following receipt of the complaint. Where the complaint is filed in respect of a network operator, the Competition Authority makes its decision within 60 days following receipt of the complaint.

(3) Where the Competition Authority requests information necessary for resolving a complaint, the run of the time limit mentioned in subsection 2 of this section is suspended until receipt of such information, but not for longer than thirty days. Where the complaint has been filed in respect of a network operator, the Competition Authority may suspend the time limit for up to 60 days, provided the complainant agrees to this.

§ 100. Acquisition of property in the public interest

(1) In addition to the grounds provided by subsection 1 of § 3 of the Immovables Expropriation Act, the Competition Authority may seek:

1) expropriation of the assets used in the activity mentioned in the authorisation, if the person operating on the basis of the authorisation fails to comply with the compliance notice instructing them to continue the activity;

2) expropriation of the assets used in the activity mentioned in the authorisation, if the period of validity of the authorisation has expired or the authorisation has been revoked and there is no guarantee that the operations carried out based on those assets will continue to be in compliance with this Act, which may possibly endanger the security of supply of the system;

3) expropriation of the network and the limited real right which grants the person the use of the network, if the owner of the network fails to perform the obligation provided by subsection 1 of § 64 of this Act or if the network operator who owns or uses the network does not hold the authorisation required under this Act.

(2) The Competition Authority may seek expropriation on the grounds provided by subsection 1 of this section only if it has given advance notice of its intention to do so to the owner of the assets that are the subject matter of the envisaged expropriation and if the owner of the assets has failed to eliminate the circumstances which serve as grounds for the expropriation within a reasonable period of time set by the Competition Authority.

(3) The Competition Authority does not have the obligation provided by subsection 2 of this section if performance of the obligation may endanger the security of supply.

(4) Expropriation is carried out under the rules provided by the Immovables Expropriation Act.

§ 100¹. Regulating cross-border exchanges in electricity

(1) The Competition Authority co-operates and exchanges information that is needed for performance of the functions provided by this Act with regulatory authorities of the Member States of the European Union and with the Co-operation Agency in order to:

1) facilitate optimum administration of the network;

2) promote the establishment of a common power exchange;

3) optimise the distribution of cross-border capacities;

4) by mutual connection of networks, achieve such a level of capacity which allows to promote competition and improve the security of supply, at the same time avoiding unequal treatment of market participants;

5) coordinate the elaboration of grid and network codes;

6) coordinate the elaboration of congestion management requirements;

7) coordinate joint monitoring of units that perform tasks on a regional level;

8) coordinate joint monitoring of assessments of the adequacy of regional and European resources.

(2) The Competition Authority uses the information to be exchanged with the same degree of confidentiality to which that information was subjected by the authority that provided it.

(3) The Competition Authority may request the opinion of the Cooperation Agency concerning conformity, to Directive (EU) 2019/944 of the European Parliament and of the Council and to Regulation (EU) 2019/943 of the European Parliament and of the Council, of a decision taken by a regulatory authority of another Member State of the European Union with regard to cross-border exchanges in electricity.

(4) In the case that a decision made by a regulatory authority of another Member State regarding cross-border exchanges in electricity is incompatible with the requirements provided by Directive (EU) 2019/944 of the European Parliament and of the Council and in Regulation (EU) 2019/943 of the European Parliament and of the Council, the Competition Authority may notify this to the European Commission within two months following the day the decision was made.

(5) If the European Commission should require that a decision of the Competition Authority concerning cross-border exchanges in electricity be set aside for reasons of incompatibility with Directive (EU) 2019/944 of the European Parliament and of the Council or Regulation (EU) 2019/943, the Competition Authority complies with the requirement within a period of two months and notifies the Commission of having complied with its decision.

§ 100². Competence of the Competition Authority in relations with the regional coordination centre

(1) In relations with the regulatory authorities of the system operation area, the Competition Authority is competent to:

1) approve a proposal for the establishment of the regional coordination centre in accordance with paragraph 1 of Article 35 of Regulation (EU) 2019/943 of the European Parliament and of the Council;

2) take into account – when approving the network charges mentioned in § 71 of this Act – any justified costs that are related to the work of the regional coordination centre and that must be borne by the transmission network operator;

3) approve a decision-making process that is based on cooperation;

4) – together with the regulatory authorities of the other Member States of the system operation area – make proposals concerning any supplementary tasks or powers that these countries should assign to the regional coordination centre;

5) verify the performance, by the regional coordination centre, of its obligations that flow from European Union law, especially in cross-border matters;

6) monitor the results of grid coordination and, once each year, in accordance with Article 46 of Regulation (EU) 2019/943 of the European Parliament and of the Council, provide a report concerning this to the Cooperation Agency.

(2) When performing the tasks mentioned in subsection 1 of this section, the Competition Authority may:

1) require information from the regional coordination centre;

2) without prior notice, inspect the premises and buildings of the regional coordination centre;

3) in cooperation with other regulatory authorities of the system operation area, make binding decisions concerning the regional coordination centre.

(3) Where the seat of the regional coordination centre is the Republic of Estonia and the centre does not comply with an obligation that flows from Directive (EU) 2019/944 of the European Parliament and of the Council, from Regulation (EU) 2019/943 of the European Parliament and of the Council or from a legally binding decision of the Competition Authority or of the Cooperation Agency, the Competition Authority may issue a compliance notice to the centre to comply with the obligation.

§ 101¹. Violation of quality requirements for network services provided

(1) Violation of the quality requirements for network services provided in the service area of a network operator by the network operator or failure to reduce network charges following a violation of those requirements, if reduction of the network charges is prescribed in this Act, is punishable by a fine of up to 300 fine units.

(2) The same act, when committed by a legal person, is punishable by a fine of up to 3,200 euros.

§ 101³. Violation of the rules for cross-border exchanges in electricity

Failure by a legal person to comply with the conditions for cross-border exchanges in electricity provided by Regulation (EU) 2019/943 of the European Parliament and of the Council is punishable by a fine of up to 32,000 euros.