The Government of the Republic approved the Recovery Plan on 17 June 2021, the European Commission approved the plan on 5 October 2021, and the EU Council approved the Estonian Recovery Plan by its Implementing Decision on 29 October 2021. The details of the reporting and monitoring of the Recovery Plan were agreed upon between the European Commission and Estonia on 22 March 2022.
On 30 June 2022 the Government of the Republic initiated the amendment of the Recovery Plan as a result of high inflation rates and the changed economic and geopolitical situation. The informal negotiations were concluded by submitting an amendment to the European Commission on 9 March 2023 and on 12 May 2023 the European Commission declared the proposed amendment to the Recovery Plan to be compliant. We expect the implementing decision of the Council of the European Union on the revised plan in mid-June. The updated consolidated Recovery Plan will be published on this website at the latest after approval by the EU Council.
- Rahandusministeeriumi pressiteade: "Taastekava muudatused said Euroopa Komisjoni heakskiidu (12.05.2023)"
- Euroopa Komisjoni pressiteade: "NextGeneration EU: European Commission endorses Estonia's €953 million modified recovery and resilience plan, including a REPowerEU chapter (12.05.2023)"
Eesti taaste- ja vastupidavuskava
In relation to the reduction of the support amount (-12.13%), the mitigation of time-related and financial risks, and the European Commission’s REPowerEU proposal, the Government of the Republic decided on 30 June 2022 to exclude Tallinn Hospital (280 million euros), Rohuküla railway (34 million euros), and the acquisition of multifunctional helicopters (46.3 million euros) from the Recovery Plan.
On 21 July 2022 the Government of the Republic decided to transfer Viljandi Hospital from the European Regional Development Fund to the Recovery and Resilience Facility for the period of 2014–2020, as the hospital will not be completed by the eligibility deadline for the expiring period and has become considerably more expensive (updated amount of 72 million euros).
On 20 September 2022 the Government of the Republic decided to replace the investment of Rail Baltic Joint Terminal 5 with the financing of the Rail Baltic viaduct, as the procurement of the joint terminal failed and the financed building will no longer be finalised during the implementation period.
The Government of the Republic decided on the negotiating position of the amount of support released on 20 September and 29 September 2022 as follows: cover the appreciated investments included in the Recovery Plan: green technologies (5 million euros), energy measures (9.9 million euros), Tallinna Vanasadama tram line (10.5 million euros); and add new measures or increase existing ones in the process of coping with the energy crisis: additional support to entrepreneurs for the deployment of resource-efficient green technologies (10 million euros); support measure to entrepreneurs for security of supply investments (20 million euros); additional money to support the reconstruction of small residential buildings (8.9 million euros); West-Estonian radar (66.8 million euros); increasing distribution network capacity (20 million euros); multifunctional work vessel (EUR 18 million euros).
Informal negotiations have started with the European Commission to amend the Recovery Plan.
In May 2022 the REPowerEU initiative was agreed to at the EU level, focusing on rapidly reducing the dependency on fossil fuels from Russia and boosting the green transition. The legal framework for the REPowerEU support has not yet been established, but the currently agreed upon amount of support allocated to Estonia is 83,423,000 euros. In addition, it is possible to transfer the unused Brexit adaptation reserve amount of 6,615,646 euros to REPowerEU. Financing proposals to the extent of 90,038,646 euros can therefore be made at the start of negotiations with the European Commission. To use REPowerEU, the Recovery Plan must be amended and the REPowerEU chapter incorporated into it, with the latest national deadline for achieving the results being May 2026.
Reforms and investments included in the REPowerEU chapter must contribute to at least one of the following objectives (the final legal framework has not yet entered into force):
- improvement of the energy infrastructure and facilities to meet the security of supply of oil and gas in the diversification of the union's energy supply (the 'do no significant harm' principle does not apply here);
- increasing the energy efficiency of buildings and related critical energy infrastructure, achieving carbon neutrality in the economy, introduction of sustainable biomethane and renewable or fossil-free hydrogen, increasing the share of renewable energy;
- elimination of bottlenecks for the transfer and distribution of energy nationally and cross-border, and for support of pollution-free transport (including railways) and its infrastructure;
- supporting the previous points by accelerated requalification of labour for green skills, supporting the value chains of key materials and technologies related to the green transition;
- tackling energy poverty and encouraging the reduction of energy consumption.
The choice of supported reforms and investments must be based on the country-specific recommendations made for Estonia for 2022/2023, including increasing public investment in green and digital transitions and energy security, which involves using RRF, REPowerEU, and other EU funds; reducing overall dependency on fossil fuels and diversifying the import of fossil fuel, accelerating the deployment of renewable energy sources by ensuring adequate interconnection capacity and strengthening the domestic power grid, increasing energy efficiency. Given the amount of the support, all the country-specific recommendations cannot be covered from the REPowerEU budget.
In addition to compliance with the REPowerEU objectives and compliance with country-specific recommendations, the suitability of reforms and investments within a narrow timeframe (results must be achieved by May 2026 at the latest), compliance with the ‘do no significant harm’ (DNSH) principles, the existence of alternative funding sources, and the inevitability and effectiveness of reforms or investments must be borne in mind.
On 15 December 2022 the Government of the Republic decided on the financing proposals to be included in the Recovery Plan to the extent of the amount of REPowerEU and to start negotiations with the European Commission as follows: renewable energy acceleration reform 31.8 million euros; increasing biogas production and deployment 20.2 million euros; additional funding for energy efficiency of small residential buildings 20 million euros; additional funding for the capacity to integrate renewable energy production into the grid 18 million euros.
Vabariigi Valitsuse protokollilise otsuse lisa:
The most significant investments in the Estonian Recovery Plan relate to the green and digital transition, which will receive over 600 million euros according to the plans. Entrepreneurs are one of the main target groups for investments in the green sector of the Estonian Recovery Plan — funding is planned to support the green transition of enterprises through a special green fund, the introduction of innovative and resource-efficient green technologies and increase in resource efficiency, adding value to bio-resources, introduction of comprehensive technologies for hydrogen, and development of skills supporting the green transition. In addition, plans are in place to support investments into increasing energy efficiency of apartment buildings and small residential buildings, as well as strengthening the electricity grid, boosting environmentally sustainable energy production in industrial areas, and implementing pilot projects for energy storage. In the transport sector, the plans foresee financing investments related to sustainable mobility with the support of the RRF.
In the framework of the digital revolution, the plan is to support investments in digitalisation and automation of companies' processes, as well as the creation of an online platform for the construction sector and prototyping of related innovative digital solutions. In addition, plans have been made to bring public digital services aimed at businesses and citizens to a new level of development, which is event-based and predictable, while also improving the availability of open data and the data quality of key registers and ensuring the sustainability of the digital state's cloud infrastructure. The availability of so-called last-mile internet access in market failure areas will also be supported.
In the field of social protection, there are plans to fund the provision of labour market measures to young people from the RRF.
Estonian Recovery and Resilience Plan (RRP) was endrosed by the European Commission on 5th of October 2021 and adopted by the Council on 29th of October 2021.
Last updated: 19.05.2023