The cash that the governments printed via negative interests to give to the VCs and to real-estate owners really skewed the local market (increasing both prices and costs of producing).
The Estonian gov has basically no tools to fight against the real estate bubble either or to bankroll the most fragile startups (and they may not be as strong as they seem), so we're basically fucked.
Regarding energy, we had 4000 EUR / MWh prices a couple of weeks ago for an hour.
Think of it as oven / sauna / air conditioner costing you 10 to 25 euros per hour (if I remember right, it didn't matter that much when you have no other choice than turning them off).
For energy this is mostly because of the war, but ecological policies also affected (Estonia was known for "dirty" petrol, known as shale oil, and they are restricted there).
The only retail companies that try hard to provide good prices are LIDL and IKEA, and in that regards, they are great.
Other distributors have very poor logistics as they consider Estonia as the very end of their distribution chain (no matter if for Baltics, or for Scandinavia we are at the end of the West).
"The cash that the governments printed via negative interests to give to the VCs and to real-estate owners really skewed the local market as well (thus increasing prices)."
Finally someone who undestood this was not linked to the war in Ukraine, but to the policy of the ECB to print money at will.
Are you saying that it's "not links" and that Ukraine did not have an impact on energy prices? That does not seem plausible but I may be misreading you.
IMHO free movement of capital without free movement of labor is a true plague.
Any country that has achieved good living standards sees their citizens pushed out of housing by the rich people of other countries. Since the inflow is capital-only, you don't see inflow of people who can contribute to the society but you see people who come and consume resources just because they made wealth buildup oversees.
People like to blame it on immigrants but when working class immigrants come they works their a*ss off and contribute huge amount into the society.
It's almost like enslavement.
Someone in a corrupt county somehow builds up some wealth, which is essentially what the society owes them(IOU). Normally they would figure out what is actually owed to who by themselves but they take that IOU's and move to, let's say a country that has good living standards, like Portugal. Now the government is happy about it because they have IOU inflow that they can tax or stir up the economy but these rich people often don't use the IOU's to bring machinery or pay Portuguese to do research or anything like that. What they do is real estate investments.
Normally that would have been O.K. but since that money is not moving in a free market(remember, only the money can move. It's very hard to move around people and services), what you have is extreme market movements due to extreme capital movements without extreme movements in labour.
For example, when a Russian oligarch brings 10 billion dollars to London, suddenly huge demand is created but Russians who owe the oligarch the services can't come to build houses needed. Obviously their money goes into other parts of the British economy but you end up with Russians in poverty, overpaid people in some sectors where the oligarch money flows and local residents who cannot afford to pay rent despite working very hard.
That's why I'm proponent for restriction of capital movements wherever there are restrictions on human movements OR removing all restrictions on all kind of movements. In the first case we will have a patchy world where those societies who got their act together flourish(but they might do nasty things to the weaker ones. Also we lose many benefits of globalisation, like specialisation) and with the second option we will have an equalised world based on merit(however the transition will be very painful for those who are in a good standing currently, it also takes generations to learn to live together).
I think you are right about the symptoms but misdiagnosed the disease.
Unfortunately I think our minds cannot comprehend how much wealth has been created in the world in the last 30-40 years, and how many rich people that's created out of the 8bn world population.
Something like 1.4m americans have a net worth above $10m. 1.4m!!! And that's just the US. Can you imagine how many millionaires the world has created? Now imagine how much real estate actually exists in the city centers of large cities in the world. Not that much. Especially in popular cities. Nowhere near enough for this wealth to go into.
This isn't about oligarchs, or rich dictators. There's nothing illegal going on here (there is a little, but its negligible).
It's the world population and the wealth we've created. It's insane. A lot of people have gotten very rich.
Sure, a lot of people got very rich and that's OK since we can also develop so much infrastructure to support it.
What I say is, the problem here comes from restricting the markets in a way that blocks natural trade and things cannot stabilize.
See, flipping burgers for a week in USA gives you an iPhone that is made by countless people all over the worlds but doing the exact same job in Turkey for example gives you a MagSafe charger only and you need to keep flipping burgers for 30 more weeks to get the iPhone.
This creates an labour arbitrage that could have been fixed with people moving around like the way it happens between cities in the same country but instead we have capital movement only which results in wealthy squeezing out the resources of areas of restricted movement, thus perpetuating the arbitrage.
It's almost like a scheme to keep the property owners and the workers in separate classes without an ability to move between classes.
This makes no sense, the majority of the inflation is simply due to rising energy prices, what does the small Estonian startup scene have to do with any of this?
It's a mix, but startups clearly skew prices higher.
Salaries gets higher too because of much corporate cash, there is this nasty infinite loop of inflation -> salaries -> inflation -> salaries.
This is why in the newspapers we occasionally see rants from the population that foreigners destroy the quality of life by pushing prices higher.
One cause is that there is a limited amount of space in Tallinn but high attractivity for IT foreigners (due to low taxes and high startup funding).
This means that good housing is though to find for a decent price (check kv.ee for example), and that there is not enough housing for everyone.
Not enough housing means lot of construction needed.
Lots of construction worldwide + scarce construction supply + abundance of money + lot of people = potential housing catastrophe.
Concretly, for example, I wanted to buy a reasonably priced house in the countryside (500K EUR for 160m2 / 1700sqft), and someone who sold his Pipedrive or Transferwise shares (I don't remember) came and offered over 100K more than the list price.
This is very broken (and I say that though I am also a startup guy, so I feel it's sad/wrong for the non-IT Estonians).
The city also have 50K to 80K refugees that came in a few months. Where do you host them ?
I noticed recently when looking for a job that I was getting higher offers and in general seeing higher salary ranges in Tallinn compared to Helsinki. About 20 % higher.
That's not the full picture. Demand for gas is still down below pre-pandemic levels.
Inflation may be too much money chasing too few goods, but the "too few goods" part is absolutely crucial here. And if we want and expanded economy, the "too few goods" part should be the focus.
The utter stupidity of thinking that sanctions could be an effective response or deterrent to military aggression boggles my mind. Force must be countered with force, nothing less. Anyone willing to expend soldiers lives is not going to be deterred by mere economic pain (the pain they've already chose, i.e. war, is much worse!). We don't impose monetary fines on murderers, we capture them and put them in jail, or kill them in the process.
Furthermore, sanctions, by definition, hurt both parties. It is impossible to design a boycott that doesn't hurt both the buyer and the seller. The only question is: who gets hurt more? If Europe was so determined to "stand with Ukraine" then they should've put soldiers on the ground over there, not shot themselves in the foot with sanctions on goods that they need.
> We don't impose monetary fines on murderers, we capture them and put them in jail, or kill them in the process.
Depends on the murderer.... sometimes we send them more soldiers to help them in places like afghanistan.. and syria.. and iraq.. and many more.
I live in a very small eu/nato country that noone cares about, and we still do it... so my taxpayer money is used for occupying eg. syria right now, in a conflict we literally have no interest in and profit nothing from.
I think (though I'm just regurgitating something I read somewhere) that the idea behind sanctions is not to use them. If you're using them, they've failed, in a sense.
So the idea is not so much to "stand with Ukraine", it's to stand with whoever is next. The threat of sanctions should be enough to prevent the future use of force, but you have to be prepared to pull through when they're ignored for that to work.
"China is able to secure cheaper supply and resell shipments from more expensive exporters to utilities in Europe and Asia, while Russia can continue selling fuel at a profit."
"The world’s largest buyer of liquefied natural gas [China] is reselling some of its surplus LNG cargoes due to weak energy demand at home. This has provided the spot market with an ample supply that Europe has tapped, despite the higher prices."
The sanctions ensure that even those Russians who don't send their children to fight and die in Ukraine feel the effects of the war. Plus if Europe out boots on the ground the chance of nuclear escalation is increased. Sanctions are part of the package, not the whole package.
Also Europe doesnt need Russian gas. It has become reliant on it sure, but it is weaning itself off that and that gives them more power and Russia less in the long term. Your points look at the immediate short term (less than 12 months) and does little to consider beyond that timeframe.
Sanctions made things worse, but Baltic countries and Poland were leaving Russian and Belarusian gas, oil and coal for long time making it not great before Russia attacked Ukraine. Estonia left Belarusian gas a month before the attack, same as Poland banned import of Russian coal causing shortage of coal locally. The countries were doing it for decades, slowly but surely moving to others sources of fuels. The sanctions only accelerated this energy crisis that was in the making. The countries are not super relevant and I wasn't able to find many sources for it in English, but here are some:
Yeah, if Polish troops entered, with high likelihood Belarus would as well. At that point it was Putins dream to escalate it to as many countries as possible.
Belarus is rather unimportant. They are 10 million country with GDP per capita lower than Russia, spending little bit more than 1% of GDP on their army. Belarusian army has also zero combat experience. They have no reason whatsoever to die in Putin's war. No glory, no territory that they want, no hatered of Ukrainians. There were soldiers openly calling for desertion which was rather impressive at least for me. It's possible that Lukashenko was actively trying to join the conflict, but the army told him no.
Poland was offering something of the form of peacekeeping mission and Zelensky was afraid that it could lead to freezing of the conflict based on his own reporting in an interview with Meduza. Ukrainians wanted to go on counteroffensive from the beginning.
This comment is not going to age well. Russian positions in Kherson and Kharkiv are collapsing like dominoes. The price that Russia is receiving for their oil due to sanctions is approaching their cost of production. Most Russian natural gas production is being flared off rather than being sold. European natural gas storage tanks are 80-95% full. 6 new LNG terminals are coming online in December. Rather than 40% less gas this winter, Europe will have 15% less gas.
Everybody who had a part to play in Russian defeat is going to be patting themselves on the back. Sanctions may have had only a small part in that, but it was a part, and anybody complaining about sanctions is going to be on the wrong side of history.
These sound like nice words on paper, but how do you go to war with a nuclear power without triggering Armageddon? It’s a serious question. MAD is absolutely still a thing and nukes are the best protector of sovereignty ever devised.
> What should we do if Russia attacks Finland tomorrow?
I'm not saying this is what we should do but it's what will happen probably: Freeze Nato accession, send guns, helmets etc. Basically whatever happened to Ukraine.
Utter rubbish. If you want to send kids to war, do it with your own.
Ukraine is neither in NATO, nor the EU. The best course of action is supporting it while it frees itself with its own means, which is what is happening.
So support it with weapons and whatever you want. But don't commit economic suicide in the meantime. Then you won't be able to support ukraine over the long run anyway.
What economic suicide ? It's not exactly a balanced struggle. It's painful for Europeans, but it's deadly for Russia. You can't bankroll Ukraine's up-scaling and fuel Russia's economy at the same time anyway, it doesn't make sense.
How do you do that with 40% less gas in 1 year? You can't, because you will have rioting in the street, you will have people literally freezing to death, and no green politician will ever get elected again.
Oh, and btw, what's the answer now to this gas shortage? Burning more coal and firewood. So your proposed vision is doubly going in the wrong direction.
This isn't like switching from windows to linux. It takes years, and people actually die in the meantime if you get it wrong.
It's not 40% less gas. Europe managed to mostly fill their storage tanks over the summer, and Germany has 6 LNG terminals coming online in December. So it's going to be only 15% less gas. So no riots, no freezing to death.
The utter stupidity of thinking that (hey, this is your line, I'm just repeating it) NATO could put soldiers into Ukraine without starting a thermonuclear global holocaust in the form of WW3.
I would go so far as to suggest that NATO has done 110% of what they can against Russia. Unlimited money for Ukraine, unlimited supplies for Ukraine, unlimited training for Ukraine, and even now basically unlimited intelligence! Think of the HIMARS! The Karkhiv offensive is Ukraine's 'first truly western' attack, complete with a southern feint, built entirely on western intelligence and strategy. And as a result, Ukraine is routing the Russian military who are in drop-everything-and-run mode in half of Ukraine. Is that not a success??
Europe/US westernized/NATOized the Ukrainian military in about 6 months flat and spared no expense in the process.
Short of starting a nuclear world war 3, it's hard to imagine doing more.
NATO intervention would not trigger WW3. Nobody is interested in invading Ukraine, besides Russia.
Also, Russia is capable to start a thermonuclear global holocaust at any point. They could literally say tomorrow - either you give us Warsaw Pact / Russian Empire territories or we start a thermonuclear global holocaust. What then?
But Ukrainians are not asking for military intervention. They are asking for stuff like ATACMS.
Lol I am going to describe your reply as Russian propaganda for a number of reasons:
1) You "" quoted "support" as a way to diminish it, even though the Western support has clearly been absolutely instrumental in every possible way to the Ukrainian resistance. To deny this is either ignorance or malfeasance. Without western "support" Kyiv would have fallen in the first weeks. Instead, Ukrainians are fully routing the Russians who are in mass retreat. Some "support"!!
2) American lend-lease is a way to reduce domestic red tape and expedite transfers of military equipment. It's a formality and the US is not some creditor hounding nations. In fact, some nations never repaid the WW2 debts at all and no one cares https://en.wikipedia.org/wiki/Lend-Lease#Repayment Your characterization of it is... bizarre and weird... unless you're pushing agitprop. If the Ukrainian people make some token tiny payment 50 years from now as a commemoration of this beautiful new brotherhood, it will be a special moment. But if it never comes, no one will care.
3) American lend-lease is SEPARATE from the monetary assistance -- the $15 billion dollars the US has given to Ukraine since the war began is not a lend-lease debt. And American lend-lease obviously doesn't cover things like the MASSIVE Polish contributions. To lump all of Western "support" into "lend-lease", when in reality it's not, again is either ignorance or malfeasance.
Lol a race to the bottom as usual with someone who is hooked on western main stream media e.g: "Russians are in mass retreat" - this is comical. People like you see no nuance, I am against the war in the first instance. A more realistic understanding of geopolitics could and should have avoided this war but that day has long since passed.
Yes i am diminishing the "support" provided by the west, as op mentioned if the west was so determined to stand with Ukraine then they should be putting soldiers on the ground. People like you couldn't careless, your "support" will just add fuel to the fire of an already burning Ukraine.
I'll go further, the wests support is actually tantamount to warmongering (but thats par for the course).
> Lol a race to the bottom as usual with someone who is hooked on western main stream media e.g: "Russians are in mass retreat" - this is comical
Lol the Kremlin yesterday posted their daily maps which showed a full retreat from the NE region to Russian borders, and social media is full of videos in NE Ukraine of abandoned gear, tanks, artillery, stockpiles, etc.
The Kremlin amusingly calls it a "a planned withdrawal" but even Russian commentators are struggling with the absurdity of the latest spin, because they have front-lines Russian bloggers attached who are filming the abandonment of heavy equipment, supplies and even small arms. How funny that you accuse me of western-MSM when even domestic Russian media has shown it.
Bless your sweet little heart, I know, it's really hard to maintain the Russian propaganda in places where the Kremlin can't murder people who disagree.
> I'll go further, the wests support is actually tantamount to warmongering (but thats par for the course).
And there it is. The 1984 Doublespeak moment that the Russian propaganda thrives on.
Defense is Warmongering. Helping is hurting. How dare those dastardly westerners allow Ukraine to freely associate with them! The Ukranian people are the property of Russia and should be thrilled to be "de-nazified"! The proper ethical decision is to simply give in during Russia's "de-nazification" genocide campaign!
I'll go further: your defense of the horrific Russian genocide campaign by attempting to blame the West for it is an act of complete moral cowardice and a textbook example of how propaganda leads people to support genocide.
Do Ukraine and the West have a course of action in case of a total energy blackout in Ukraine right before the winter [1]? It seems to me that the local success in Kharkiv is not possible to expand onto other regions without significant army loss, because the adversary is energy-independent and is able to continue indefinitely as long as they don't lose their military or as long as their losses are xN fewer than Ukraine's. How much military did Ukraine lose to achieve success in Kharkiv region?
>Do Ukraine and the West have a course of action in case of a total energy blackout in Ukraine right before the winter [1]?
While Russia's attacks on Ukraine's power and heating infrastructure are vile and evil and designed to hurt civilians, I do believe that the West has many plans to help the people of Ukraine who are displaced and at-risk due to Russia's warcrimes.
This also includes the reality that the Russian's are attempting to destroy nuclear facilities to create a massive regional fallout event, another breathtakingly evil war crime.
> It seems to me that the local success in Kharkiv is not possible to expand onto other regions without significant army loss, because the adversary is energy-independent and is able to continue indefinitely as long as their army doesn't lose its military or as long as their losses a xN fewer than Ukraine's.
This doesn't make any sense. Russia is not "energy-independent", quite contrary, they require supply lines for fuel to keep the vehicles moving just like everyone else. The Russian supply lines have been notoriously bad this war, which is arguably the #1 reason for the poor Russian performance. (Although American intelligence tracks all Russian supply movement in Ukraine, and American HIMARS can hit any target in Ukraine, so the Ukrainians have viciously destroyed Russian supply infrastructure from long range, forcing Russians to keep supplies far from the front).
Ukraine has just dealt a massive blow to the Russian resupply lines by taking major train hubs that the Russians, until 3 days ago, were using to resupply forces across Ukraine.
> How much military did Ukraine lose to achieve success in Kharkiv region?
Considered that there was very little reports of Russian resistance (they were in full withdrawal and not mounting any kind of stand), reports from both Ukraine and Russia show that losses over the past 3 days have been minimal for both sides.
> While Russia's attacks on Ukraine's power and heating infrastructure are vile and evil and designed to hurt civilians, I do believe that the West has many plans to help the people of Ukraine who are displaced and at-risk due to Russia's warcrimes.
What help would it be in case of a blackout? Energy prices in Europe are soaring at the moment and I don't see a clear strategy how these infrastructure destructions could be mitigated and replaced by european nations on a timely manner, that is crucial for civilians' safety in major urban areas. People in rural areas could probably fallback to sustaining their households by burning logs and coal, but the city dwellers?
Food and medical supplies, fuel for non-electric heating, etc. We'll help the Ukrainians survive. The people of Europe are strong and will endure.
Yes, Russia will be able to enact a lot of pain of Europe through natural gas, but the reality is that Europe is fully capable of transitioning away from Russia, while Russia has absolutely zero plan for their economy after losing their biggest export and biggest customer.
Honestly, the oligarchs, the Russian generals, the Russian people, when they realize that their main source of money is being replaced permanently it's not hard to imagine regime change leading to the end of the invasion and re-opening of supplies. Putin might not care, but his people do. This is how out of control dictators fail... they cut off their nose to spite their face.
Lol social media is full of videos? well thats me convinced. Even if that were the case it doesn't even matter, Putin cannot and will not loose this war.
I see no need to respond to your hysterical misrepresentation of my point. Holding an opinion on an issue that is not yours does not mean i immediately support the exact opposite. Again, no nuance with you at all. Again, I am against the war. Putins resolve is far stronger than the wests and whether you like it or not Putin is winning the war.
>Lol social media is full of videos? well thats me convinced. Even if that were the case it doesn't even matter, Putin cannot and will not loose this war.
More denial of real evidence. I love how casually people simply discard real video evidence that goes against their propaganda beliefs. What about the Kremlin's official maps? I notice you did not have any opinion when I quoted the Kremlin. Hmm!
Putin can and will lose this war, and it will cost him his position and his country.
> I see no need to respond to your hysterical misrepresentation of my point
Fascinating how when I use the exact same debate tactic as you, suddenly you feel the need to pretend to be above it (despite doing the same thing multiple times in a chain we can all read). I love the "golden rule mirror" because it exposes the hypocrisy of bad actors online so effortlessly.
> Again, no nuance with you at all
And I would charge that you have no evidence. You exist in a world of stories and propaganda and your only skills are "denying video evidence" and "spinning stories the opposite".
Also, the person who says "putin cannot and will not lose" is saying someone else has no nuance? This is rank hypocrisy and a bad joke.
> Putins resolve is far stronger than the wests and whether you like it or not Putin is winning the war.
The genocide of the Ukranian existence will not succeed, no matter how much Na*i Putin and his supporters like you want it to be. The Russian genocide will fail.
Why? The entire domestic predicate of the war is non-existence. 50% of Russians do not follow the war and don't care. Putin plays on ferris wheels while his army crumbles in mass retreat.
The only way Putin can win is through a full scale draft and war-time mobilization of the Russian economy, which he cannot do.
We are watching the end of Putin's Russia in real time. I personally believe that the fallout from this massive blunder will be the breakup of Russian colonization across Asia, and countries like China will be growing.
Putting NATO soldiers on the ground is equivalent to declaring WW3, few are willing to do that.
Therefore, Ukraine's fate is sealed and the outcome is dictated by Russia's desires.
The open question is how long it will take and at what cost, to Ukraine, its allies and Russia. And it seems that there are vested interests in prolonging the conflict as much as possible.
> Therefore, Ukraine's fate is sealed and the outcome is dictated by Russia's desires.
That is very far from the truth - please check the recent events. It is possible to fight against Russia, and it is in the best interest of the Europe and the collective west to do so.
For multiple decades Russia was using energy as a way to corrupt EU.
It was never only about Ukraine - occupation of Ukraine was always the first step. Baltic countries and Poland understand that very well, please listen to them. If Ukraine falls, Russia will invade Europe in a decade with Ukrainian military on its side.
Europe need to remove its dependence on the Russian gas completely for its own safety. Inflation is a very small price to pay compared to the alternative.
> That is very far from the truth - please check the recent events
You are forgetting or ignoring Russia's bigger guns. If Russia wanted to use NATO methods, it would be over in one day with hundreds of thousands of civilian casualties.
> For multiple decades Russia was using energy as a way to corrupt EU.
"Interesting" narrative.
> If Ukraine falls, Russia will invade Europe in a decade with Ukrainian military on its side.
If Russia wanted to attack NATO and start WW3, it would already have done so. Why would it need to attack Ukraine first?
Please try to think logically.
> Europe need to remove its dependence on the Russian gas completely for its own safety.
The same as above applies. If Russia wanted to conquer Europe as you seem to believe, independence from Russia's gas isn't going to help in any way to prevent that.
Carpet bombing? Burning cities with napalm? Using depleted uranium? Burning children with Phosphorus? Planting mines for civilians? Supporting terrorist organizations that bombs people, or even directly bombing people directly? Starving thousands of hundreds of people and openly admitting doing that...
Do you need more?
Only it's difficult to actually use them without getting getting preventative strike yourself. NATO had tactical nukes as well, they only declared it after ruZZkies threatened to use it.
Russia can threaten with nuclear holocaust at any time for whatever reason.
They could say tomorrow: give up all land that belonged at some point to Russian Empire, Soviet Union, Warsaw Pact or we will start nuclear holocaust. They could even demand Alaska. Then what? We give in? No!
If russia could conquer ukraine by wanting it harder, I think they’d have tried that? Russia has stalled and began losing ground because their army isn’t very good, not because of some detail of russia’s desires
They haven't tried that with all means available to them, and the means aren't nukes. As the recent events show, Russia could put Ukraine into a total energy blackout [1][2] if they decided to pursuit this strategy of waging the war. This would be the same strategy that was used by the US military in past conflicts [3], and it implies significantly more civilian casualties in a long run.
> You're assuming that money and power matters less to Putin / oligarchs than lives. I'm not sure that's a valid assumption.
My point is, they've already risked far more than just their money and power by going to war. They've also risked their lives (if there was a coup, they'd be dead), and the lives of their countrymen, and the future/standing of their whole country. Such people are not going to be deterred by sanctions they already knew were coming.
> effective response or deterrent to military aggression
(1) We shouldn't conflate current deterrent & future deterrent. Putin may be all in already, but you can signal to a future autocrat that he'll risk the stability and safety of his rule if he follows in Putin's footsteps. Selfish autocrats don't want to die.
(2) Some targeted sanctions are actually effective. You hamper their military industry supply chain, which they need for a long war.
Inflation that's not to do with wages seems a different problem to me.
If gas or tomato prices are going up such that everything that uses gas or tomatoes goes up. You could say that's inflation because gas and tomatoes are so widely used.
Or you could just say it's a price signal. You need to use less gas/tomatoes as they are in short supply.
It doesn't seem to be as circular as the wage based inflation, where the higher wages and the higher costs are the same thing and recurse.
If your wages track inflation, then you were previously underpaid for your skill set.
In reality, higher costs may eventually be followed by compensating higher pay, but in the interim everyone just works the same for the same (devalued) pay with a steep drop in discretionary spending because the step function to 'unemployed' is so painful that everyone would rather handle the price feedback through attrition. And in the meantime we get the shittification of all service that wasn't previously operating at high margins, because everyone is making do with understaffing.
And, of course, tomatoes are ridiculous equivalency to attempt. Transportation, energy, and agriculture all lie directly downstream of oil/methane costs, to name a few obvious examples.
Properly managed, the Baltic states in particular will come out of this energy crisis as winners. Green energy is the very obvious answer for them, even more than for other countries. Cheap and reliable.
They have all that's required to be self sufficient and even exporters in terms of energy:
- little heavy industry
- very low population density in rural areas
- mostly centralised heating networks in urban areas
- plenty of cheap biomass, mostly for use in winter
- a fairly decent bit of sun, mostly for use in summer
- plenty of hydro power [0]
- fairly good hvdc interconnects
- plenty of cheap EU cofinancing
- a population largely ready to stick it to the godfather in Moscow
These are the pros but you forgot to outline the cons. One of the big issues with green energy in the Baltics is the lack of grid capacity. You can have solar panels fitted but unless the grid has enough throughput for you to be able to actually sell it back it's not worth much. These days the costs to upgrade the local grid are prohibitively expensive so it's not going to happen unless the government does it.
I'd expect a somewhat half capable government to take care of that using 85% EU co-financing like what happens for about all crucial infrastructure in the Baltics.
I only know about the situation in Latvia in detail. There, installing small scale solar really is quite lucrative. You can use the amount of excess electricity produced in summer in winter, paying only the very low standard network infrastructure fee on top. Plus subsidies: up to 4k€ for your solar install, up to 4k€ for buying an electric car, and up to 4k€ for a heat pump install.
I don't know the answer to your question for certain, but let me make an educated guess:
- Some electricity production in Latvia is natural gas based cogeneration, meaning it needs to run for inhabitants to have hot water.
- At Pļaviņas hydro station [0], the biggest in the Baltics with 894 MW, water levels were lowered from July 11 until August 20 for maintenance work. Production might not have resumed yet.
- Latvia has an extremely large natural gas storage facility at Inčukalns [0]. This might have something to do with it.
By the way, press 5 years on that historical graph and hydro is accounted for most generated electricity. Moreover, if you scroll knob to left to view more historical values. At 8 AM 26%+ came from hydro, but now 1,97%...
I guess this time we can admit a supply problem is to blame and not the usual money printing/government spending explanation, since Estonia is well known for having a tiny debt to GDP ratio.
Except that oil is nowhere near that expensive in reality, and oil companies aren't buying oil at anywhere near that price. The reason it's expensive in Europe now (for consumers) is because the EU lump oil and gas together into one price, and gas is expensive, so oil got expensive, but the oil companies haven't paid nearly that much to buy it in the first place. That's why they are having a massive windfall and the EU is going to tax them.
These are all problem can be solved by capping oil price. Oil is a buyer's market, the US and Canada are producing so much of it, if OPEC+1 reduces output, it just amounts to a suicide for them.
The two data points that determine the market price in nord pool right now is the gas price and transmission costs. The revenue that renewable power plant owners get is determined through those mechanism rather than by what production cost those renewable plant owner has. As the economist here has reported in the news, more renewable energy doesn't translate to lower prices at this point in time.
EU are considering capping the price roof in order to address this so that energy prices start to match that of production costs. The European grid also need overproduction if we are to have market forces driving down prices, and you need large and effective transmission lines in order to distribute the renewable energy without bottlenecks. We also need to have reduction in energy usage when renewable energy production is low, and we need to reduce the dependency on the quite aged hydro power installations in the northern parts of Europe. The water reserves at those hydroelectric stations is also in a historically low levels, likely caused by a combination of climate change and poor management.
We need more of everything if we are to disconnect the Russian gas from European energy market.
We physically can't build enough windmills to replace fossil fuels. They'd take up too much space.
I'm all for having renewables when the technology is ready, but it's not and high energy prices will start killing old people that can't afford to heat their homes.
Are you saying there's no space in Estonia for ~1466 wind turbines? That's before we include offshore wind, solar, geothermal, nuclear, hydro, and storage... Basically, you're spreading FUD.
I was more thinking of more populated countries like the UK, but it's still a large part of the countryside.
>> That's before we include offshore wind, solar, geothermal, nuclear, hydro, and storage... Basically, you're spreading FUD.
Yeah, one of those is not like the other. Not sure how you slip nuclear in there given that Greens are against it. Storage isn't a solved problem either.
They may be against it. They also have a very minor representation in the uk gov, so not that relevant. Storage is practically non-issue. We can dump the waste underground for thousands of years with almost no planning. (still a more healthy solution than what we do with other fuel now) The volume required is basically not worth talking about.
Maybe our economic systems have to be rethought? A tree is worth more dead than alive..... European economies have been accumulating wealth for centuries through colonization and exploitation of humans lifetimes... in the end what do you have? inflated real estate prices, overly mechanized agriculture producing basic junk foodstuffs, increasingly authoritarian political policies designed to restrict or bore people from contributing to civil society... this is leading to an existential crisis ....
So many good films out there which capture the essence of the problem, that dreadlock guy who works? for Microsoft has a very good quote in "Social Dilemma" (1)
One suggestion would be politicians to be chosen by jury, for periods of say a year to lock them out of having so many fingers in lobbyists pies...
Yep, and at the same time, the "greens" are against nuclear, the only thing that could actually replace fossil fuels and also works during windless nights.
No, they don't. Try doing the math. You'll end up at single digit percentages of land used. You can easily do agriculture around wind turbines, so land use really is not problem at all.
Where does the power come from on overcast and windless days?
Renewables definitely have their place, but they are nowhere near being able to replace the continuous production of FF and nuclear plants. Moreover, the grids were neither designed nor built to deliver power from massively distributed, massively variable sources.
There's a third problem too, which ecologically-minded people seem to overlook: renewables are only "renewable" if you consider the real estate they occupy to be infinite.
Again, there is an important place for these technologies, but it is not the case that we simply should have built more.
Power comes a) from another place in the European grid where it's sunny or windy, and/or b) storage. a) works decently well today, b) has room for improvement, but demand for storage is low, since we don't have a lot of surplus energy that we could put into storage. Right now it's pretty much always easier to turn down the fossil fuel plants when renewables are generating a lot, so that's what we do.
Medium/long term we can solve this with storage and load shifting. For the time being it still comes from fossil fuels and nuclear as you say. But using renewables when sun and wind are available would still dramatically reduce are fossil fuel consumption, which would in turn dramatically reduce costs.
The argument is that fossil fuel companies are not beginning new starts, because ESG components from investors mean that the money isn't there.
I doubt it, however. Even fossil fuel companies know we are transitioning away from oil over the next few years, and don't want to staff projects anyway. This is classic behavior at a tech switch.
The cash that the governments printed via negative interests to give to the VCs and to real-estate owners really skewed the local market (increasing both prices and costs of producing).
The Estonian gov has basically no tools to fight against the real estate bubble either or to bankroll the most fragile startups (and they may not be as strong as they seem), so we're basically fucked.
Regarding energy, we had 4000 EUR / MWh prices a couple of weeks ago for an hour.
Think of it as oven / sauna / air conditioner costing you 10 to 25 euros per hour (if I remember right, it didn't matter that much when you have no other choice than turning them off).
For energy this is mostly because of the war, but ecological policies also affected (Estonia was known for "dirty" petrol, known as shale oil, and they are restricted there).
The only retail companies that try hard to provide good prices are LIDL and IKEA, and in that regards, they are great.
Other distributors have very poor logistics as they consider Estonia as the very end of their distribution chain (no matter if for Baltics, or for Scandinavia we are at the end of the West).