Teresa Ribera No 12.1-2/2937-1
Euroopa Komisjon Our ref. 20.06.2025
cab-ribera-rodriguez-
[email protected]
Estonia’s proposal for CISAF
Dear Vice-President,
I would like to begin by expressing my appreciation for your leadership on climate and
energy matters in the transition to clean and competitive economy. The European Clean
Industrial Deal is certainly a crucial step to support the transition of EU Member States’
industries towards a more sustainable and innovative economy, where environmental and
climate objectives are integrated with the needs of industrial development. In relation, I
would like to share some important points for Estonia regarding the upcoming Framework
for State Aid measure to support the Clean Industrial Deal (hereinafter CISAF) which will
be a great support in achieving our goals.
Estonia submitted preliminary unofficial comments on the draft CISAF by 1 May 2025 in
the form of on-line answers to the consultation document. Please find below some additional
comments which we consider important to address in the final version of CISAF for it
achieve its full benefit and help Member States in the clean transition.
Estonia overall supports the draft CISAF, which allows for a rapid decision from the
European Commission authorizing state aid in the cases specified in the framework. We do
believe however that the framework should have more opportunities to support other
objectives of the Clean Industrial Deal, like circular economy and technologies consuming
renewable electricity for example and be more flexible in terms of conditions.
Our more extensive comments relate to the critical topic of energy. We welcome the
conditions for granting state aid to accelerate the deployment of renewable energy and we
align with the Commission on the conditions for granting state aid for investments in self-
generation of energy. However, we believe that support measures for emission-free
technologies in the energy infrastructure should be technology-neutral, including wind
energy, nuclear energy, energy storage, hydrogen technologies and other equivalent
solutions.
In general, we also support the conditions for state aid to reduce industrial CO2 emissions,
but we believe that requiring Member States to provide justifications if aid schemes are
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limited to certain sectors and penalizing the failure to meet investment deadlines if this is
due to circumstances beyond the control of the aid recipient would not be justified.
We see the benefit in the possibility of the CISAF to provide aid to ensure sufficient
production capacity of clean technology, which includes, among other things, the production
of carbon capture, usage and storage (CCUS) equipment.
We support measures to reduce the risks of private investments. In case financial instruments
are used as a support measure, there should be no time limit on the loan period, or it should
be possible to extend loans throughout the useful life of the technology. The useful life of
different zero-emission technologies varies significantly. For example, nuclear and hydro
technologies have useful lives of 80-100 years, offshore wind about 30-50 years, less for
onshore wind, and hydrogen technologies often have a useful life of less than 10 years.
Accordingly, loan periods should be technology-dependent.
We endorse the more flexible implementation of capacity mechanisms in the electricity
market, but we believe that even greater flexibility is needed to make the most use of CISAF,
therefore we propose:
Adding to the framework the possibility to determine the need for a reserve capacity
mechanism on a national analysis (NRAA) in addition to the European System
Capacity Analysis (ERAA). Allowing the use of NRAA is important especially in
exceptional situations where, for example, the adoption of the European level
analysis (ERAA) is delayed.
Allowing small Member States and regions with limited demand flexibility options
greater flexibility to allocate the costs of capacity mechanisms among consumers. As
a result of the solution in the draft, the total price of electricity would increase during
peak consumption periods by an additional imbalance charge, in a situation where in
the Nordic countries it is often not possible to flexibly postpone consumption during
the winter period.
Extending the possible period for strategic reserve contracts (one year in the draft),
as otherwise some dispatchable generation capacities may permanently exit the
market and it will no longer be possible to use them to ensure the strategic reserve in
later years.
And finally, we suggest using the same aid intensities for SMEs throughout the framework:
20 percentage points for small enterprises and 10 percentage points for medium-sized
enterprises. This would ensure a more level playing field.
I apologise for the last-minute submission of our comments and suggestions but hope that
they can still be taken into account when finalising the text of CISAF. As said above, the
framework is essential in helping us achieve the clean transition goals and therefore its
details should be carefully considered to ensure the framework’s most beneficial form.
Yours sincerely,
(signed digitally)
Jürgen Ligi
Minister of Finance
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Kaupo Raag +372 5885 1386
[email protected]
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