Price for the Network Service

Network fees in Estonia and neighbouring countries

The network fee is based on the reasonable costs that the network operator must pay to do its job properly and maintain its service capacity. Costs and capacity differ a lot and therefore the network service fees differ from operator to operator and country to country. The network maintenance costs depend on the following factors:

  • The compactness of the electricity network or the capacity of the network compared to the number of customers and their consumption volumes, because a substantial part of the fee is often calculated from the number of kilowatt-hours consumed.
  • Conditions in the network area. Costs differ in forested areas, areas exposed to the weather or areas with high population density.
  • Necessary network renovation. The level of network service fees in the past, reflecting the capacity for network renovation in the past, determines how much investment is needed now.
  • Network service fees in the past. This shows how much the network operator has been able to invest in the network in the past.

Each kilometre of Elektrilevi's power lines carries barely a quarter of the amount of energy carried in lines in Spain or Great Britain and only two-thirds of the amount carried in neighbouring Finland (source: Eurelectric 2008). This also affects the network fee unit price, mainly where the kWh-based payment model is used.

It is also affected by the technical condition of the network, which in some areas does not meet customers' expectations. At the end of the Soviet era and in the 1990s, upgrades to the distribution network in Estonia were not possible due to the lack of money, which is why the need for investment is so great today.

We compared the network service price for the typical Elektrilevi residential customer with electricity consumption of 3000 kWh per year and the service price for the average residential home with consumption of 18 000 kWh per year to the price paid by a similar consumer to a network operator with a similar service area in our neighbouring countries. The data are from April 2014.

Transmission fee (kWh)
Base rate in package "Võrk 1",consumption 3000kWh per year; 25A; residential customer

Transmission fee (kWh)
Base rate in package "Võrk 4",consumption 18 000kWh per year; 25A; residential customer

  • Fixed fee (cents per kWh)
  • Transmission fee

For some customer groups the network fee in Finland may be lower, since all places of consumption there contribute to keeping network connections in efficient working order through fixed fees. This payment model allows the price of the kWh-based network fee component to be kept down. The kWh-based fee is most widely used at present in Estonia meaning that places of consumption with zero consumption do not pay network fees even though network operators still have to cover the costs of maintaining the working efficiency of network connections for such places of consumption. There are about 45,000 such places of consumption in the Elektrilevi service region.