Estonia is set to expand its solar-power production with a €62 million loan from the European Investment Bank (EIB) and local banks SEB and Luminor, aimed at financing a new solar park developed by renewable-energy company Sunly. The investment represents a significant step towards the Baltic region's energy independence following its decoupling from the Russian electricity grid.

The EIB will provide €31 million in funding, while SEB and Luminor will jointly contribute the remaining €31 million. The financing will support the construction and operation of the Risti solar park, a 244-megawatt peak (MWp) photovoltaic (PV) facility, set to become the largest of its kind in the Baltic states. Located in Lääne County, approximately 65 kilometres southwest of Tallinn, the solar park is expected to be operational by 2027 and will generate enough electricity to power over 80,000 Estonian households. The project is being developed in partnership with local landowner Metsagrupp.

The funding follows the recent synchronization of the Baltic states’ electricity grid with the European Union system, marking a key milestone in the region's transition away from dependence on Russian energy supplies. This shift aligns with the EU's broader goal of achieving climate neutrality by 2050.

Commitment to renewable energy

"This investment underscores our commitment to supporting renewable-energy projects in the Baltic region," said EIB Vice-President Thomas Östros. "By increasing solar-energy capacity in Estonia and integrating the Baltic states into the continental European grid, we improve energy security, reduce emissions, and stimulate economic growth."

The Risti solar park is the EIB's first fully merchant renewable energy financing project in the Baltic market, meaning its revenues will rely solely on electricity sales rather than government subsidies.

Sunly currently operates 334 MW of renewable energy capacity across the Baltics and Poland and has 839 MW under construction. The company aims to reach 1 gigawatt (GW) of operational and under-construction capacity by 2026.

"The EIB’s financing will support Sunly in developing the Risti solar park and its grid connection, designed to integrate battery storage and wind power at the same location," said Priit Lepasepp, CEO of Sunly. "With selected technology, we aim to add 1,000 MWh of battery storage to the Baltic grid by the end of 2026. This setup enables flexible expansion, optimised revenues, and greater energy stability for the market."

Banking sector support

Both SEB and Luminor have highlighted the importance of achieving Estonia's renewable energy targets.

"The solar park to be constructed is significant because it will provide the largest renewable electricity production capacity in Estonia to date, built entirely at market conditions, fully supported by private and loan funds without state subsidies," said Indrek Julge, Head of Corporate Banking at Luminor Estonia. 

Finally, Peep Jalakas, Member of the Management Board and Head of Corporate Banking at SEB, commended Sunly's efforts: "Financing renewable energy projects is not easy for banks in the current market situation, making Sunly's professional structuring of their projects even more commendable. The involvement of the EIB as a key lender demonstrates the importance of collaboration between commercial and development banks in meeting Estonia’s renewable energy goals."