(Bloomberg) -- Estonia said it would set aside €100 million ($103 million) for a new gas-fired power plant to boost energy security after repeated damage to subsea electricity connections.
The funding decision, announced on Thursday evening by the government, came a week after a 170-kilometer (106-mile) underwater power cable connecting the Estonian and Finnish grids was broken by the anchor of a passing ship. Estonian authorities suspect the act was deliberate and linked to Russia.
While Estonia has repeatedly said its national power supply is not at risk after the incident, officials have estimated that the downed power cable will cost electricity consumers an extra €39 million to €100 million over the course of seven months.
Funding for the new Estonian gas plant will be injected into the share capital of state-owned energy company Eesti Energia AS, but the plant will not be ready until at least 2028. The European Union member with 1.3 million people has traditionally relied on oil-shale power plants, with around 1,200 megawatts of total capacity.
Last week, Finnish authorities detained an oil tanker they believe had hit the EstLink 2 cable with its anchor and Estonia deployed a military vessel to protect the adjacent EstLink 1 connection. A year earlier, a gas pipeline between Finland and Estonia was punctured by another ship. The incidents have raised concerns over energy security in the Baltic region.
“Russia is looking for new opportunities to harm Estonia and other European countries,” Estonian Prime Minister Kristen Michal said at a press conference on Thursday ahead of the funding decision.
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