Opinion A green boost to Estonia’s blue economy
ESTONIA HAS CAPITALISED on megatrends by developing a digital state and creating a significant and enduring competitive advantage.
Reaching climate neutrality creates new business opportunities for Estonia and the maritime sector. The average useful life of ships is about 30-50 years, depending on the type of ship, docks and maintenance. It is a long-term investment, meaning the vessels will need to be rebuilt due to the pressure of environmental regulations. Due to this change, there is an opportunity to create a ship-conversion centre or retrofit hub in Estonia, which would bring direct economic benefits to Estonia and the maritime sector and enable the existing infrastructure of the ports to be used more efficiently.
The transition to environmentally friendly fuels and the creation of bunkering options for these fuels are central to reducing the footprint shipping leaves. Bunkering for green fuel options would create a competitive advantage over other regional ports. When restructuring shipping lines or planning new lines, the availability of bunkering facilities is a factor. Having them would create a greater potential for attracting new shipping lines to our ports.
In addition, achieving climate neutrality would be an opportunity to turn ports into centres of alternative fuels. Alternative fuels, in turn, help to increase the volume of cargo—the existing terminals located on the port’s territory can re-profile themselves and restore the volume of liquid cargo that has fallen, and new players and operators entering the market bring an increase in the volume of cargo.
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The technologies to achieve climate neutrality is still a matter for research and development phase, just as we have much to learn about which green fuels will work best in practice. This uncertainty has caused companies to hesitate in making investments, as they want to avoid making the wrong decision. The delay in developing and introducing these technologies is primarily due to the significant investment required, the absence of regulations and other factors. Additionally, implementing technological changes by one partner often necessitates changes by many different parties as well.
The Port of Tallinn’s primary challenge is reducing pollution from ship traffic and visits to achieve climate neutrality. This applies to both our fleet and visiting ships. This goal can be accomplished by gradually transitioning to alternative fuels. At the same time, in addition, to ship traffic, the Port of Tallinn’s business also includes passengers, goods, and real estate, for all of which it is essential to find methods to permanently reduce air pollution and waste or channel them into a circular economy.
The Port of Tallinn, with the Port of Helsinki, initiated the FIN-EST Green Corridor project. The project aims to create an environmentally friendly and climate-neutral journey for customers travelling between Tallinn and Helsinki. This includes promoting eco-friendly tourism services and transportation in both cities, implementing climate-neutral services and infrastructure at the ports, and utilising eco-friendly ships and onboard services. Both cities – Tallinn and Helsinki, as well as all shipping companies and the Ministry of Climate, have joined the project.
As part of the Green Corridor, the Port of Tallinn has already rolled out new technologies. These include shore electricity on five quays in Vanasadam, automatic mooring equipment on three quays and the launch of the Smart Port (Tark Sadam) application for automatic vehicle traffic management system—all of which help reduce emissions. We have been measuring our carbon footprint since 2019 and constantly seek ways to reduce it.
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Investing in the development or introduction of technology increases success and benefits. A great example and opportunity can be found in the experience of Estonian shipbuilders and ship repairers and the potential to utilise it in establishing a ship.conversion capability centre, also known as a retrofit hub, along with all the associated services.
We are currently seeking new terminal operators, as well as investors for our industrial parks in Muuga and Paldiski who can develop their production here. At the same time, green energy remains a sore point for us. At an early pace, investments should be made to increase the capacity of renewable energy. The Port of Tallinn is negotiating with existing and new operators to produce and store green energy in the industrial parks.
Increasing Estonia’s share of renewable energy is also socio-economically beneficial. It helps reduce dependence on imported fuels, makes the environment cleaner and creates local jobs. This is particularly important for transport industries, where most of the fuels used are imported fossil fuels. Hydrogen as a renewable energy carrier and fuels is promising as a replacement for fossil fuels for transport.
Estonia has the potential to produce a significant amount of green hydrogen and its derivatives, creating export opportunities and opportunities for energy valorisation and self-consumption. This potential is contingent on the realisation of planned on-shore and offshore wind farms.
It would certainly also be a significant export item. The first offshore wind farms will be completed in 2028-2030. When building them, storage solutions can also be considered to produce green hydrogen when energy is cheap and consumption is low.
Vlado Klam is the chair of the board of the Port of Tallinn.
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