Opinion article by Kalev Kallemets, Ph.D., CEO and co-founder of Fermi Energia AS
From Lennart Meri’s idea of connecting Estonia with Europe onward, several Estonian governments have consistently and officially supported the implementation of the Rail Baltica project. By now, practically the entire Estonian route has been designed and covered by construction contracts. Nevertheless, malicious criticism persists, claiming that the project is pointless, too expensive, and certainly will not be completed on time, writes Kalev Kallemets.
Real-world proof shows that the new direct Tallinn–Tartu–Riga line opened in January has been very well received by passengers, even though the Tallinn–Riga journey still takes six hours. The fact is that Latvian tourists are very common in Pärnu, and there would certainly be even more Latvians in Estonia and Estonians in Latvia if the connection were faster. A concrete example of regional development: largely thanks to Rail Baltica, the private developer PSP Capital is building 78 new modern apartments in Kohila, and BLRT is constructing a cast-iron foundry there for 14 million euros.
Let us look at the bigger European picture. Europe has over 10,000 kilometres of high-speed rail lines capable of speeds exceeding 200 km/h, with Spain leading at approximately 4,000 kilometres, followed by France and then Germany. This is cutting-edge technology that is not actually very widespread – for example, the United Kingdom has only a few sections with speeds over 200 km/h. Considering Spain’s population of about 50 million, this amounts to roughly 80 km of high-speed rail per million inhabitants. In Estonia, Rail Baltica will provide 213 km for 1.3 million people, or 163 km per million inhabitants, exactly twice as much per capita, and 85 percent of this is financed by the European Union. We should be very satisfied and praise everyone who initiated this project.
It is crucial to compare Rail Baltica’s construction costs with those of other European high-speed rail projects. According to public data, Spain is the most efficient country in Europe in high-speed rail construction, with an average cost of 17.7 million euros per kilometre in recent years. In Germany, high-speed rail costs range between 20 and 50 million euros per kilometre, depending on population density and geological and technical conditions. Europe’s worst example is the UK’s HS2 railway, where costs reach 220 million euros per kilometre and the project has gone massively over schedule.
The first phase of Rail Baltica, with construction costs of 15.3 billion euros including terminals, comes to 26 million euros per kilometre, clearly on the more affordable end, and excessive complaining about costs is unwarranted. It is true, however, that construction in Latvia is significantly more expensive per kilometre than in Estonia and Lithuania. The Estonian section will cost 3 billion euros, which means the Estonian state budgets must also include appropriate funding for Rail Baltica and be demanding toward Latvia to do the same in accordance with its obligations.
Rail Baltica, designed and built for uniform speeds over 200 km/h, is an exceptional achievement that is not common even in Sweden and Finland. In Finland, the Helsinki–Oulu line operates at 160–200 km/h, and the line toward Turku reaches speeds of up to 200 km/h in places, but the only full line that consistently operated above 200 km/h was the Allegro connection between Helsinki and Saint Petersburg, which has been closed since February 2022.
Efforts to develop a new 150-kilometer high-speed rail line between Turku and Helsinki have continued for a long time, but in July 2024 the European Commission refused to finance it. At the end of 2025, Finland’s central government and municipalities reached a financing agreement for the Länsirata project with a budget of 3 billion euros, or about 20 million euros per kilometre. Of this, 530 million euros will be covered by state-guaranteed loans taken by the project company. Construction is expected to begin in 2027, once municipalities approve funding and planning decisions, and to continue until 2032. The overwhelming justification for developing high-speed rail is road congestion, the need to decentralize settlement from Helsinki, and enabling regional and overall economic development. Finland’s economy is not doing well, and if the state itself cannot mobilize for smart megaprojects, improvement cannot be expected.
Megaprojects are almost always controversial, as they generate speculation, doubt, and intense efforts to assign blame instead of focusing on how to move forward. There is also good reason to analyse and calculate carefully, because not every large project, be it a Tallinn hospital, a light metro, or a hydrogen pipeline to Europe, is reasonable or necessary at every moment or in every form. However, we must have the maturity to understand that well-justified megaprojects force people and the state to pull themselves together, surpass themselves, cooperate, and they deserve funding, learning, and change to everyday life. Nations and states that choose complaining and giving up will decline and become unnecessary to anyone. Estonia, as a small nation, must set clear goals with Rail Baltica and other megaprojects and be capable of carrying them out in order to be relevant, progressive, and effective.
Read the original article in Estonian on Postimees here.