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1 INTRODUCTION

Ferry services are lifelines for island and coastal

populations, providing essential links that sustain both

economic stability and social cohesion in the absence of

fixed connections [1]. In systems serving inhabited

islands, operators must balance reliability,

affordability, and adequate service frequency while

coping with pronounced seasonal demand fluctuations

and harsh operating conditions[2] [3]. These services

play a critical role in mitigating structural

disadvantages such as limited labour markets and

restricted access to essential services in peripheral

regions [4].

At the same time, ferry systems face growing

pressure to reduce greenhouse gas emissions and

improve energy efficiency. The International Maritime

Organization has set a target of cutting shipping

emissions by at least 50% by 2050, supported by short-

term efficiency measures and pathways toward low-

and zero-carbon technologies [3] [4]. In Europe, the

Sustainable and Smart Mobility Strategy and the ‘Fit

for 55’ package call for substantial decarbonisation of

maritime transport by mid-century, with zero-

emission vessels expected to enter regular service

during the 2030s [5] [6].

In this context, this paper pursues three objectives.

First, it assesses the strengths and weaknesses of

Estonia’s island–mainland connectivity system,

covering both the major routes serving Saaremaa and

Hiiumaa and the smaller island links. Second, it draws

on selected international experiences to contextualise

Estonia’s governance arrangements, service provision,

and sustainability challenges. Third, it proposes

pathways for improving ferry services by integrating

international lessons with national policy priorities and

Enhancing Island–Mainland Connectivity in Estonia:

Organizational and Sustainability Challenges

M. Utso

, I. Zaitseva-Pärnaste

& K.E. Parnell

Tallinn University of Technology, Tallinn, Estonia

Tallinn University of Technology, Kuressaare, Estonia

ABSTRACT: In this paper we analyse ferry connectivity between Estonia’s mainland and major islands, focusing

on structural drivers of service performance, costs, and sustainability. Using operational data and institutional

analysis, we show that outcomes are shaped primarily by route characteristics, seasonality, vessel requirements,

and infrastructure lock-in rather than operational efficiency alone. The current reliance on uniform large ice-class

ferries and terminals tailored to existing vessels has reduced system flexibility and constrained decarbonisation.

Drawing on selected international practices with relevance to Estonia, the analysis identifies four strategic

priorities—measurable service levels, clearer institutional responsibility, more flexible funding, and diversified

fleet deployment—and demonstrates that right-sized vessels and modular capacity can improve utilisation,

reduce energy demand at terminals, enhance resilience to variable water levels, and support phased

electrification. Strengthening island connectivity therefore requires integrated planning of services, vessels, and

infrastructure under clear governance frameworks.

http://www.transnav.eu

the International Journal

on Marine Navigation

and Safety of Sea Transportation

Volume 20

Number 2

June 2026

DOI: 10.12716/1001.20.02.18

450

European climate objectives. The analysis uses

multiple sources. Operational data from the largest

ferry operator TS Laevad covering the period 2017–

2023 provide insight into traffic volumes, route

performance, and contractual compliance.

Procurement documents from the Estonian National

as delays and unclear requirements including

ambiguities in technical specifications, environmental

criteria, and responsibility allocation.

2 ISLAND CONNECTIVITY IN ESTONIA

2.1 Governance and Service Provision in Estonia

It can be argued that Estonia’s ferry connections to the

main islands are currently stable, flexible, and user-

friendly, providing a solid foundation for future

development. The fleet includes four modern ice-class

ferries Leiger, Tõll, Piret and Tiiu delivered in 2016 and

2017 [7] as well as smaller vessels Ormsö, Kihnu Virve,

and Soela, delivered between 2015 and 2017 [8], that

serve smaller islands under separate contracts. These

vessels ensure resilience across seasonal weather

conditions. Two reserve ships are available to cover

peak demand during the busy summer months, as well

as to substitute vessels during maintenance periods

and technical failures.

Operational data from two main operators (TS

Laevad OÜ and Kihnu Veeteed AS) show that

passenger and vehicle numbers have steadily

increased across all routes between 2017 and 2023. This

growing demand reflects the wider socio-economic

role of ferries, with tourism and commuting being

actively promoted, and the maintenance of the viability

of island communities requiring the integration of

certain services with the mainland. During high-

demand periods, reserve capacity helps reduce

congestion, maintaining service reliability and

strengthening confidence in the network. Ticketing has

also become more accessible and flexible. The digital

platform praamid.ee [9] allows people (for both

passengers and vehicles) to make reservations in

advance, and to modify bookings without cost or use

the same ticket for a later departure, reducing waiting

times at ports and improving the overall passenger

experience. Taken together, these operational strengths

demonstrate that Estonia has achieved reliability and

accessibility on a par with leading ferry-dependent

nations. However, we argue that this success rests on a

fragile foundation. Without clearer governance and

long-term fleet planning, inefficiencies and limited

transparency threaten to erode the service. Moreover,

the absence of a long-term strategy for vessel

replacement or low-emission technologies means that,

despite the fleet’s relatively young age, renewal and

decarbonisation pathways remain uncertain.

Despite the central role of the ferry network,

Estonia’s regulatory and institutional framework

remains fragmented (Figure 1). Ferries are formally

classified as public transport under the Public

Transport Act [10], but they also function as maritime

infrastructure directly linked to the national road

system. This dual classification has created

overlapping responsibilities with vessel procurement

and operation falling under the Ministry of Climate

and its agencies, while port infrastructure is managed

separately by the state-owned company Saarte Liinid

AS. Overall service provision is coordinated by the

Ministry of Regional Affairs and Agriculture through

the Public Transport Department. The result is a

system whereby procurement, infrastructure

investment, and service planning are poorly aligned,

making it difficult to implement coherent long-term

strategies. No single authority is responsible for

integrating these elements, and transparent

monitoring mechanisms remain limited.

Figure 1. Institutional structure of ferry service governance in

Estonia. Arrows indicate funding flows, regulatory

responsibilities, and operational relationships between

government bodies, state-owned entities, municipalities, and

ferry operators.

Unlike in some other countries such as Scotland

(discussed in section 3) where performance audits and

strategic documents are publicly available, Estonia

lacks an accessible and transparent framework for

monitoring service quality and contract compliance.

Indicators for these parameters remain few and

ambiguous, a shortcoming that has been highlighted in

recent studies [11]. Comparable dilemmas have been

recognised in Finland, where policymakers have

concluded that it is politically impossible to

simultaneously increase competition, maintain service

levels, and reduce public expenditure without major

institutional reforms [12].

Service provision is organised through public

service contracts. On the two main routes (Virtsu–

Kuivastu and Rohuküla–Heltermaa [13]), contracts

typically run for seven years, while smaller routes such

as Ruhnu, Munalaid-Kihnu, and Sõru–Triigi routes,

are tendered for five years [14]. Estonia’s small market

restricts competition: only a handful of operators are

capable of bidding, with tender documents often

presupposing that bidders already own suitable

vessels. This ensures continuity but reduces the scope

for innovation or alternative solutions. The relatively

short contract durations (7 years for main lines and 5

years for small islands) limit the horizon for strategic

planning, since major fleet investments usually require

a 15–20-year amortization period. As a result,

procurement processes structurally favour operators

with existing fleets and constrain the development of a

coherent long-term fleet renewal strategy.

The service model is highly car-oriented, with ferry

capacity and timetables optimised for vehicle transport

rather than for public transport integration. Alternative

modes, such as coordinated bus services or cycling

infrastructure, remain underdeveloped, while the

needs of passengers with reduced mobility are

insufficiently addressed. Contract specifications

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define vessel parameters and frequency but omit

systematic CO₂ accounting or binding emission-

reduction targets. Compared with countries such as

Norway, where environmental requirements are

embedded in contracts and have accelerated the

adoption of hybrid and electric ferries [15], Estonia’s

model remains focused on basic accessibility and short-

term cost control. Technological choices must also be

evaluated against both environmental and economic

criteria. Without integrated consideration of these

parameters, Estonia risks high fuel consumption,

stranded assets, and missed opportunities to align

ferry operations with climate policy [16]. Ticketing

processes demonstrate similar integration constraints.

For the main routes, the praamid.ee system offers

flexible and user-friendly booking options, while

smaller island services remain fragmented, with tickets

sold through four separate providers. This reflects the

broader lack of a unified framework for service

delivery and underscores the institutional divisions

that complicate governance.

Fleet ownership further illustrates these structural

weaknesses. In 2014, the government brought the main

island routes under direct state control by

commissioning four new ferries through the fully state-

owned company AS Port of Tallinn, ending long-term

cooperation with AS Saaremaa Laevakompanii. A new

subsidiary of AS Port of Tallinn, OÜ TS Laevad, was

established to operate them [17] [7]. The ships entered

service in 2016–2017, not because the previous fleet was

obsolete, but to secure strategic state ownership. In

2018, the AS Port of Tallinn was partially privatised,

leaving ferries procured as state assets tied to a

company with private shareholders [18]. This hybrid

model blurred responsibilities, reduced transparency,

and complicated accountability for fleet renewal.

Ongoing disputes over a planned fifth vessel

highlight these problems. Intended initially as a

hydrogen-powered ferry, the project was adjusted

after funding constraints, but tenders in both 2024 and

2025 failed to attract bids [19] [20]. As a result, no vessel

has been procured to date. Although the aim was to

replace an ageing reserve vessel, the absence of a

coherent renewal strategy left procurement criteria

misaligned with environmental targets. The result is a

system where strategic policy goals and tendering

practice pull in different directions.

Finally, Estonia’s monitoring framework remains

narrowly focused on passenger volumes and

frequency, offering little information on fuel use,

emissions, or efficiency. This absence of systematic

performance data makes it difficult to assess whether

public investments are meeting decarbonisation and

accessibility goals. By contrast, international practice

shows that transparent monitoring frameworks are

essential for balancing affordability with

environmental and social objectives. Italy’s National

Strategy for Inner Areas, for example, links transport

planning with wider socio-economic development

strategies, underlining that accessibility in peripheral

regions cannot be secured through infrastructure

investment alone [1]. Procurement processes for new

ferries have been marked by delays and disputes,

highlighting the need for clearer contractual

frameworks and accountability mechanisms.

While the current operational model delivers

reliable day-to-day service, it is largely oriented

toward short-term continuity rather than long-term

system optimisation.

2.2 Service Performance and Demand Trends

Service performance is defined by passenger numbers,

vehicle traffic, and seasonal demand. These patterns

reveal whether capacity is sufficient and how well

services meet the mobility needs of island

communities. Estonia’s island–mainland ferry network

is dominated by a small number of major routes

alongside medium-scale and lifeline routes.

Importantly, route lengths vary substantially across

the network, ranging from short crossings of only a few

kilometres to open-sea connections exceeding 100 km

(Figure 2). The two major routes are Virtsu-Kuivastu (7

km) and Rohuküla-Heltermaa (22 km), which carry the

vast majority of passengers.

Medium-scale routes include Rohuküla–Sviby (10

km), Munalaid–Kihnu (16.5 km), and Triigi–Sõru (16.5

km), which provides a direct Saaremaa–Hiiumaa

connection. Beyond the two main routes, Estonia’s

ferry network thus comprises two distinct categories of

smaller routes: medium-scale inhabited island routes

(Kihnu, Vormsi and the Sõru–Triigi link) and very low-

volume lifeline services to micro-islands such as

Abruka, Manija and Ruhnu, which differ

fundamentally in demand, operational conditions, and

service objectives.

Figure 2. Main island–mainland ferry connections in Estonia.

Annual passenger volumes for each route in 2023 are shown.

Muhu and Saaremaa are connected by a permanent road link,

so the Virtsu–Kuivastu ferry effectively provides access to

both islands. Passenger volumes on the Roomassaare–

Abruka and Munalaid–Manija routes are very low and are

therefore not considered in the subsequent quantitative

analysis.

Among the lifeline routes, Ruhnu maintains very

low but socially critical traffic volumes and is

accessible by ferry only during the summer season,

with services operating on a rotating basis from

Munalaid (66 km), Pärnu (103 km), and Roomassaare

(77 km). During winter, access is provided exclusively

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by air transport. Roomassaare–Abruka (7 km) and

Munalaid–Manija (0.8 km), by contrast, are served

year-round by water.

Between 2017 and 2023, passenger and vehicle

numbers have risen on all the routes. On the Virtsu–

Kuivastu route, traffic increased steadily for both

passengers and vehicles (Figure 3). The Rohuküla–

Heltermaa route shows a similar trend, with total

passenger traffic up by 28%, vehicle transport by 49%,

and resident ticket sales by 81%. A comparable upward

trend was also observed across all medium-scale and

lifeline routes

Figure 3. Monthly passenger and vehicle volumes on the

Virtsu–Kuivastu route (2018–2023). Passenger numbers

range from approximately 100 000 in winter to over 300 000

during summer peaks, while vehicle volumes increase from

about 50 000 to nearly 150 000 per month. Dashed lines show

linear trends fitted to monthly data. The sharp decline in 2020

reflects reduced travel demand during the COVID-19

pandemic.

Despite overall growth, demand remains highly

seasonal. Summer peaks push vessels to near full

capacity on all routes while winter traffic drops

sharply, leaving large ice-class ferries underutilised.

This mismatch results in higher costs per passenger in

winter raising questions about the efficiency of

operating large vessels year-round when such capacity

is only required for a few months annually. Weekly

and daily variations are also highly variable. On the

Rohuküla–Heltermaa route (Figure 4), departures

concentrate on Fridays and returns on Sundays.

Comparable weekend peaks are also seen on other

routes.

Figure 4. Total passenger volumes by weekday and travel

direction in 2023. Higher inbound volumes on Fridays and

outbound volumes on Sundays reflect typical weekend travel

patterns between the mainland and all the islands.

Overall, these demand patterns show that capacity

utilisation fluctuates considerably over time.

Consequently, unit costs are influenced not only by

operational efficiency but also by structural factors

such as route length, vessel characteristics, and

demand variability. This interaction is illustrated in the

combined cost-per-passenger analysis presented in

Figure 5.

There are significant cost and revenue differences

between the two main routes, largely driven by their

contrasting lengths and operating conditions. Virtsu–

Kuivastu is a short crossing with high service

frequency and consistently strong demand, generating

relatively high ticket revenues and lower unit costs. By

contrast, the Rohuküla–Heltermaa connection spans a

much longer distance and requires larger ice-class

vessels to ensure year-round operation, resulting in

substantially higher costs per passenger. Although

both routes rely on state subsidies to remain affordable,

this comparison illustrates in simple terms how route

length and operating conditions directly influence

financial sustainability.

Figure 5. Total operating cost per ferry route in 2023, showing

the proportion of costs covered by ticket revenue and the

proportion financed through state budget subsidies (€).

On the smaller island routes, ticket revenues cover

only a very small proportion of operating costs,

indicating that these services function primarily as

lifeline connections rather than market-based

transport. Ruhnu represents an extreme case, with

minimal demand and very high cost per passenger. By

contrast, although passenger numbers on the

Rohuküla–Heltermaa route have increased, unit costs

remain significantly higher than on Virtsu–Kuivastu

due to the longer crossing distance. This disparity is

further accentuated by seasonal underutilisation,

where large vessels operate at low occupancy in

winter, while summer peaks briefly push capacity to its

limits.

Smaller connections such as Munalaid–Kihnu,

Rohuküla–Sviby, Ruhnu routes, and Sõru–Triigi

operate at much lower passenger volumes, functioning

primarily as lifeline services for local residents. Their

operation under shorter, five-year public service

contracts reflects higher vulnerability: limited demand

reduces financial viability and places these routes

lower in policy prioritisation. While they rely on

smaller vessels adapted to local port conditions, service

speeds are broadly aligned with the wider network. As

vessel speed is a primary determinant of fuel

consumption, operating at these speeds under low

occupancy leads to disproportionately higher costs and

emissions per passenger. This contrast highlights a

broader challenge for Estonia’s ferry system: whether

fleet strategies can be diversified to balance efficiency

and resilience across routes of very different scale.

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The growth in vehicle transport has been steeper

than passenger growth, pointing to a service model

that primarily accommodates cars. Vehicle decks are

often fully booked in summer, while passenger spaces

remain underutilised. This autocentric focus reinforces

dependence on private cars, partly because integration

with bus and rail services remains weak. For people

without cars—including those with reduced

mobility—the accessibility of ferry travel is more

limited, underscoring the need for stronger intermodal

connections and inclusive design. International

experience shows that ferry systems aligned with

public transport networks can reduce car dependence

and improve accessibility for all users [21] [22].

Overall, Estonia’s ferry network demonstrates

rising demand and strong user reliance, but also

inefficiencies caused by seasonality, high operating

costs, and car-dominated travel. Figure 3 and Figure 4

illustrate how daily and seasonal variations generate

mismatches between capacity and actual demand,

increasing fuel consumption and cost per passenger.

While large ice-class vessels guarantee winter

resilience, they sail with significant unused capacity

outside the summer peak. In summer, demand exceeds

vehicle deck capacity and requires reserve vessels, but

in winter the same ships operate with low occupancy

and high fixed costs. This imbalance undermines cost-

effectiveness and highlights the need for long-term

planning that better aligns vessel deployment with

seasonal demand, while also integrating accessibility

and environmental performance into procurement

criteria. Together, these results suggest that observed

cost differences are driven mainly by structural

conditions rather than operational choices, providing

the basis for the fleet and infrastructure challenges

discussed in the following section.

2.3 Fleet and infrastructure challenges

Research in the Baltic context indicates that battery-

electric ferries are best suited to short routes with

adequate charging infrastructure, while diesel-electric

hybrid vessels provide a practical transitional solution

on routes where full electrification is not feasible [23].

Ferries powered by fuels such as LNG, hydrogen, or

ammonia face significant technical and regulatory

barriers [24]. These studies also highlight that

electrification is most effective when combined with

right-sized vessels and flexible deployment patterns,

allowing smaller ferries to operate efficiently during

off-peak periods while enabling higher service

frequency during peak demand through modular

capacity [25] [26]. Research in the context of the Baltic

Sea indicates that fully electric and diesel-electric

hybrid vessels are currently the most feasible

alternatives to large diesel-powered ice-class ferries

[27]. Smaller, right-sized vessels can reduce peak

power requirements at terminals, making

electrification more achievable in constrained grid

environments and reinforcing the case for modular

fleet configurations. Evidence from comparable island

ferry systems further indicates that service

configuration can be as important as vessel technology

in reducing emissions: smaller vessels operated at

higher frequency can achieve substantially lower CO₂

emissions per passenger and vehicle than larger ferries

on the same connections, highlighting the potential of

right-sized fleet deployment even within existing route

structures [28].

Although TS Laevad introduced hybrid technology

by converting the ferry Tõll in 2020 [29] operating on

the Virtsu-Kuivastu route, the initiative has not been

extended to other vessels. Empirical studies of in-port

and island ferry services show that hybrid diesel-

electric vessels achieve approximately 10–12% higher

energy efficiency and corresponding CO₂ reductions

compared with conventional full-diesel ferries,

confirming the potential of hybrid retrofits as an

effective interim decarbonisation measure [30]. The

retrofit of Tõll demonstrated tangible benefits,

including reported fuel savings of around 20% under

typical operating conditions, yet this experience has

not translated into a broader decarbonisation pathway.

To date, neither the state nor operators have adopted a

long-term fleet renewal strategy, leaving vessel

replacement and decarbonisation largely reactive

rather than planned.

Port infrastructure has similarly been adapted

reactively to the existing vessels rather than on the

basis of long-term planning. Most terminals have been

rebuilt or modified to accommodate the current ferries,

ensuring compatibility with the existing fleet but

making it more difficult and costly to accommodate

different vessel types in the future. Operational

constraints further illustrate the limitations of the

current fleet configuration: periodic low water levels

on the Rohuküla-Heltermaa connection already affect

service reliability, highlighting the vulnerability of

deep-draft vessels and the potential advantages of

smaller ferries with reduced draught, which would

offer greater flexibility under variable water levels. As

a result, investments in vessels and ports have not been

strategically aligned, reinforcing the short-term and

fragmented nature of Estonia’s connectivity system.

3 STRATEGIES FOR IMPROVING ISLAND

CONNECTIVITY

3.1 Establish a National Framework for Measurable

Service Levels

Currently, Estonia lacks a unified strategy that

addresses ferry service levels, fleet renewal, and

environmental targets in a coherent manner.

Implementing a national strategy would consolidate

existing initiatives under a common framework,

ensuring that operational objectives align with broader

transport policy goals and sustainability commitments

under the Fit for 55 initiative [5]. This strategy should

also include clear service level agreements (SLAs) that

define measurable quality standards, such as

punctuality, vessel capacity, and emission reduction

targets [31]

International experience shows that measurable

service levels are central to ensuring consistency and

transparency. In Norway, ferry service levels are

determined using a structured framework that

considers factors such as traffic intensity, vehicle

waiting times, and route length [32]. In Sweden, ferry

services are formally integrated into the road network,

with Trafikverket’s subsidiary Färjerederiet operating

40 routes nationwide. In the Stockholm archipelago,

services are procured by Region Stockholm, which

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bundles more than 30 routes into long-term contracts;

while price remains important, environmental and

service quality requirements are gaining influence,

including provisions for electrification [23]. In

Scotland, service quality is systematically monitored

through contractual reporting [33], with CalMac’s

performance data on punctuality, reliability and user

satisfaction made publicly available [34]. These

examples demonstrate how measurable frameworks

allow policymakers to monitor outcomes and hold

operators accountable, while giving users confidence

in the reliability of services.

By contrast, Estonia has no uniform framework to

define or monitor service performance. The absence of

binding standards makes service planning reactive,

fragmented, and difficult to evaluate. In Scotland,

systematic performance audits have informed reforms

in ferry governance and procurement, demonstrating

the value of transparent monitoring frameworks for

publicly funded services [22] [35]. An official and

publicly accessible framework would prevent ad hoc

decisions and support strategic planning across all

publicly funded ferry routes.

Institutional fragmentation further complicates the

situation. Previous research has shown that

fragmented governance structures and weak inter-

agency coordination hinder the development of

systemic transport solutions [36] [37]. This insight also

applies to Estonia, where overlapping responsibilities

between ministries and operators make long-term

planning difficult. Service level governance should

therefore be clearly assigned to one lead body or

supported through formal coordination mechanisms,

ensuring that responsibilities are transparent and

decisions consistent.

The national framework should also be directly

linked to public procurement contracts and service

delivery monitoring. Without predefined quality

standards, it is difficult to compare services across

different islands or evaluate operator performance.

Clear expectations would help align operational

outcomes with contractual obligations, reducing

disputes and ensuring accountability. To make the

framework meaningful, it must include measurable

indicators such as minimum departure frequencies,

maximum waiting times, seasonal coverage,

punctuality thresholds, and user satisfaction metrics.

Regular monitoring and public reporting would

ensure accountability and allow adjustments based on

actual performance. Service level definitions should be

applied equitably, while still accounting for the specific

needs of different islands. Categorising routes—for

example, distinguishing between major islands and

small or remote islands—could help tailor expectations

without compromising comparability. A structured,

transparent system would promote fairness across

regions and support informed policy development.

In summary, Estonia should move from an ad hoc

and fragmented system towards a national framework

that establishes binding, measurable, and transparent

service levels. Drawing on international examples from

Norway, Sweden, and Scotland, such a framework

would help align ferry operations with national

transport policy, strengthen accountability, and

provide island communities with more reliable and

equitable connectivity. Unlike in these countries,

however, Estonia also operates routes to very small

islands with only a handful of permanent residents. For

such cases, international best practice offers limited

guidance, and Estonia needs to develop its own

context-specific minimum service standards to ensure

fair and sustainable access. Recent research has already

proposed an operational model for defining service

levels for Estonian small islands, including

differentiated categories such as daily, scheduled,

invitation-only, and tourism-based services, which

could provide a practical basis for national policy

development [11]. Implementing defined service levels

in practice requires procurement and contract

structures that actively incentivise service quality and

efficient asset utilisation, reinforcing the need for

analysis-led rather than reactive decision-making.

3.2 Reduce Institutional Fragmentation and Clarify

Responsibilities

A broader OECD International Transport Forum (ITF)

review of Estonia’s transport sector, including island

ferry connectivity, similarly concludes that

infrastructure decisions are often taken before

systematic analysis, reinforcing reactive investment

patterns and weakening long-term strategic planning

capacity [38]. The division of responsibilities between

the Ministry of Climate, the Ministry of Regional

Affairs and Agriculture, and various state-owned

companies complicates strategic planning and

investment coordination in Estonia. As highlighted in

previous sections, the absence of a unified framework

for service levels makes it difficult to align operational

outcomes with national policy goals. Without clear

institutional leadership, planning remains vulnerable

to overlapping mandates and inconsistent priorities.

In several countries, ferry routes are formally

integrated into the national transport network,

enabling more coherent planning, stable funding, and

clearer institutional responsibility [2] [27] [39].

International practice demonstrates that strong

institutional coordination is a precondition for reliable

and sustainable ferry services. Evidence from the

Finnish archipelago further shows that ferry services

are treated as a public service obligation rather than a

market-based activity, with long-term state support

enabling stable planning and sustained accessibility for

remote islands. This institutional commitment has

been identified as a key factor behind the relatively

well-functioning ferry network in Pargas, Finland,

despite low population densities and high operating

costs [40]. In Norway, ferry governance is consolidated

under the Norwegian Public Roads Administration,

which sets clear service level requirements and ensures

that procurement aligns with both accessibility and

environmental objectives [41]. Sweden has adopted a

dual approach: Trafikverket manages the national

road-ferry network directly through its subsidiary

Färjerederiet, while Region Stockholm procures

archipelago services through bundled long-term

contracts that increasingly emphasize environmental

criteria such as electrification [23]. Beyond Europe,

similar governance challenges have been identified in

North America. A review by the Michigan Department

of Transportation concludes that ferry access for island

residents must be treated as a public service obligation

requiring sustained state-level responsibility, rather

455

than fragmented local arrangements [42]. Overall,

these examples reinforce the need for a clear

institutional owner of island–mainland connectivity in

Estonia, with defined accountability for long-term

service performance and investment planning. This

approach would also facilitate the implementation of

sustainable procurement criteria, promoting the

acquisition of hybrid or electric vessels to reduce

greenhouse gas emissions, as demonstrated by recent

initiatives in Scotland and Sweden [43] [44].

3.3 Introduce a More Flexible and Needs-Based Funding

Model

A flexible funding model that considers seasonal

demand variations and route-specific cost structures

could improve both financial sustainability and

operational efficiency in Estonia. The current

approach, where subsidies are allocated primarily on

the basis of contractual commitments, leaves little

room to adjust to unexpected demand shifts or to

incentivize innovation. This rigidity is particularly

problematic in a context where traffic volumes

fluctuate strongly between summer peaks and winter

lows, and where smaller islands often face higher unit

costs due to low passenger volumes.

Affordability mechanisms such as Scotland’s Road

Equivalent Tariff, which aligns ferry fares with

comparable road travel costs, illustrate how pricing

policy can improve accessibility for island residents

when embedded in a wider public service framework

led by Transport Scotland [45]. International

experience also shows that differentiated pricing and

subsidy allocation can be designed on an economic

basis rather than uniform contractual rules. In Norway,

Ramsey pricing principles—where higher-demand

routes contribute more to subsidising socially

necessary low-demand services—are used to balance

affordability and efficiency across routes with very

different demand levels [46]. This suggests that Estonia

could similarly explore fare structures or targeted

subsidies that better reflect residents’ mobility needs,

rather than relying solely on uniform contractual

pricing.

International practice illustrates several ways in

which funding design can improve outcomes. In

Norway, subsidy allocation explicitly accounts for

route characteristics and demand patterns, ensuring

that high-cost connections to small islands remain

affordable, while shorter and more heavily used routes

are operated at higher frequencies [46].In Washington

State, targeted capital funding has been used to

accelerate the introduction of hybrid-electric ferries

and terminal electrification, demonstrating how

financial incentives can be linked directly to

environmental objectives [47]. Both cases show that

flexibility in funding models can help balance

efficiency, equity, and sustainability goals. Similar

findings are reflected in earlier studies, which show

that targeted funding mechanisms can incentivize

operators to adopt low-emission vessels and optimize

service frequency to match demand fluctuations [15]

[33].

For Estonia, a reformed funding model could

include performance-based subsidies, rewarding

operators who meet predefined targets related to

service quality, punctuality, and emission reduction.

At the same time, subsidies should reflect seasonal and

geographic variations: major routes to Saaremaa and

Hiiumaa may justify higher baseline support due to

their strategic importance, while smaller island routes

could be subsidized on the basis of minimum service

guarantees. Such differentiation would align funding

more closely with actual mobility needs, rather than

relying solely on uniform contractual arrangements.

Addressing seasonality requires not only

differentiated subsidies but also flexible service models

and capacity management strategies that can adapt to

fluctuations in demand, a challenge emphasized in

international studies of island ferry systems [21] [23].

Options include using modular fleets that allow

smaller vessels to operate in off-peak periods,

adjusting timetables to better match passenger flows,

and introducing contractual mechanisms that enable

temporary increases in sailings during peak tourist

months. Earlier research on archipelago transport

systems shows that pronounced seasonality is a

structural characteristic rather than a temporary

imbalance, leading to persistent inefficiencies in

capacity utilisation [25]. Consequently, seasonality

requires not only adaptive service planning but also

flexible resource allocation and structural responses in

fleet and funding models. By embedding these

principles in funding arrangements, Estonia could

ensure that ferry services remain both reliable and cost-

efficient year-round, while also advancing the

transition toward low-emission maritime transport.

3.4 Diversify the Fleet and Optimize Vessel Deployment

Estonia’s current reliance on four identical large ice-

class ferries for year-round operations introduces

structural inefficiencies. These vessels are designed to

meet severe winter conditions, but their reinforced

hulls and propulsion systems result in higher energy

demand even during open-water operation, increasing

fuel consumption and emissions irrespective of

seasonal demand levels. Recent empirical analysis

based on MRV data further shows that a higher ice

class is directly associated with increased fuel

consumption even under open-water conditions [51],

reinforcing the inefficiency of operating large ice-class

ferries year-round [2] [24]. A more diversified fleet

structure would improve alignment between capacity

and actual demand.

While Estonia’s core ferry fleet is relatively modern,

both reserve vessels are of advanced age and

approaching the end of their economic service life. At

the same time, recent attempts to procure a new vessel

have not resulted in a contract award, leaving the

system without a clear replacement pathway.

Together, these factors expose a growing structural

vulnerability in fleet resilience, particularly during

peak demand and unplanned maintenance periods.

Optimisation studies of passenger ferry systems

further confirm that aligning vessel size and

deployment with actual demand patterns can

significantly improve both economic efficiency and

service performance. Fleet allocation models show that

mixed and modular fleets outperform uniform vessel

strategies, particularly in systems with strong seasonal

456

variation, by reducing unit costs while maintaining

required service levels [26].

International experience shows that fleet renewal is

most effective when embedded in long-term strategies

that link vessel procurement with climate targets and

coordinated port investment, as demonstrated by

Transport Scotland’s Islands Connectivity Plan and

Färjerederiet’s Vision 2045 [44] [48] [49]. Clear, time-

bound targets (such as defined shares of low-emission

vessels) provide certainty for operators and enable

coordinated infrastructure planning.

Earlier studies confirm that vessel size and

operational patterns are decisive for both economic

and environmental performance. Adjusting vessel size

and speed to actual demand can significantly reduce

costs and emissions [50]. Electrifying and right-sizing

domestic fleets yields substantial efficiency gains and

greenhouse gas reductions [51]. Ferry fleet

decarbonisation strategies must integrate both

economic and environmental dimensions,

underscoring the need for diversified and

technologically adaptive renewal [16]. Together, these

findings strengthen the case for moving away from a

uniform fleet model. International practice

demonstrates how such approaches can be

implemented in ferry systems. In Norway, vessel size

and frequency are adjusted according to route length,

seasonal variation, and traffic intensity, supported by

contracts that encourage the use of hybrid- or fully

electric ferries on less trafficked routes [32]. Scotland

has introduced a small vessel replacement programme,

deploying energy-efficient ships for secondary routes

while reserving larger ferries for peak demand [52].

These examples illustrate how diversified fleets

enhance service flexibility and reduce both fuel

consumption and environmental impact.

For Estonia, adopting a mixed fleet strategy would

mean deploying smaller, more fuel-efficient vessels on

major routes during winter, while maintaining ice-

class ships as reserve capacity and when ice conditions

require their use even to maintain minimal service

levels, and for peak summer operations. Integrating

hybrid-electric or fully electric ferries would further

reduce emissions and align national operations with

EU and IMO climate objectives [3] [5]. Coordinated

investment in charging infrastructure and port

upgrades will be essential to support modular

deployment and ensure that vessels of different sizes

can be rotated between routes. A gradual transition to

a diversified and modular fleet would therefore

enhance both economic efficiency and environmental

performance, while providing resilience against

seasonal fluctuations. Such a strategy would bring

Estonia closer to the flexible, low-emission ferry

systems already being implemented in comparable

island regions.

3.5 Strengthen Data-Driven and Integrated Transport

Planning

Implementing digital monitoring systems that track

real-time service data, including fuel consumption,

CO₂ emissions, passenger volumes, and vehicle

occupancy, would provide valuable insights for

optimizing ferry operations and identifying areas for

improvement [53]. Coupled with regular user feedback

surveys, such systems would help align service

provision with passenger expectations and support

more adaptive operations.

These insights are also critical for improving

integration with the national transport network.

Aligning ferry timetables with bus and rail

connections, particularly during peak and off-peak

periods, would enhance intermodal connectivity and

provide passengers with more reliable and convenient

travel options. At present, ferries often run with high

vehicle occupancy but relatively low passenger

numbers, indicating a modal imbalance and limited

integration with public transport [53]. Coordinated

planning between ferry operators, the Public Transport

Department, and local municipalities, supported by

digital monitoring and user feedback, is essential to

ensure seamless connections and minimize transfer

waiting times [32]. Similar priorities have been

emphasised in Scotland, where the Islands

Connectivity Plan identifies integration across

transport modes as a central objective [48]. A

comprehensive transport strategy that considers both

mainland and island mobility needs would further

enhance accessibility, efficiency, and sustainability [1].

4 CONCLUSIONS

This study examined the organisation and

performance of Estonia’s island–mainland ferry

system in relation to three key objectives: ensuring

governance stability and transparency, improving

service quality and accessibility, and aligning fleet

strategies with sustainability goals.

First, analysis of governance and procurement

frameworks shows that Estonia has achieved a degree

of stability through long-term contracts and state

involvement, ensuring reliable year-round services.

Institutional fragmentation between ministries,

agencies, and state-owned companies has created

overlapping responsibilities and reduced

transparency. In contrast, international experience

shows that integrated governance models, supported

by systematic monitoring and public accountability,

help balance efficiency with long-term resilience.

Second, service performance indicators confirm

that ferry connections are vital for island residents and

visitors, with steadily rising passenger and vehicle

volumes since 2017. Ticketing for the main routes has

improved accessibility, yet the system remains highly

vehicle-oriented, with weaker integration into other

modes of public transport and insufficient adaptation

to the needs of vulnerable groups. Seasonal demand

fluctuations further expose inefficiencies: while ferries

operate at or near capacity in summer, they remain

underutilised in winter, resulting in high costs and

environmental pressures. Addressing these gaps

requires clearer service standards that link frequency,

affordability, and accessibility with broader socio-

economic goals.

Third, fleet and operational challenges highlight the

tension between winter resilience and year-round

efficiency. The reliance on large, ice-class ferries

ensures reliability in severe conditions but increases

fuel consumption and operational costs outside the

winter season. International examples show that

457

modular fleets, hybrid propulsion, and flexible

deployment strategies can reduce both emissions and

costs, while aligning with decarbonisation targets.

Estonia’s failed procurement attempts in 2024–2025

underline the need for a coherent long-term fleet

renewal strategy that integrates technical, financial,

and environmental considerations from the outset.

Taken together, the findings indicate that Estonia’s

ferry system has a solid foundation in terms of

reliability but faces structural weaknesses that limit its

adaptability and sustainability. Addressing these

challenges requires a shift from short-term

procurement and fragmented governance towards

integrated, evidence-based planning that combines

service quality, accessibility, and decarbonisation

objectives. On this basis, the study highlights the need

for measurable service levels, clearer institutional

responsibility, more flexible funding, and diversified

fleet deployment—while showing that right-sized

vessels and modular capacity can improve utilisation,

reduce energy demand at terminals, enhance resilience

to variable water levels, and support phased

electrification.

Such a transition would not only improve

operational efficiency but also ensure that ferry

services continue to function as lifeline connections

supporting the wider development of Estonia’s island

regions.

ACKNOWLEDGEMENTS

The authors acknowledge the Ministry of Regional Affairs

and Agriculture and the Estonian Transport Administration

for providing data and facilitating access to statistical

information used in this study. The research was supported

by the Estonian Research Council grants PRG1129 and

PRG3038.

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