Under the proposal, a number of storage facilities will be established and peat producers will be paid to maintain them. The agreement will cover around 20 of the country's largest producers of fuel peat and at most, storage of 12 million cubic meters of peat reserves.
In addition, supports will be provided for the use of peat in electricity generation. The operators of power plants will be paid a subsidy up to 2011 in order to make peat price competitive with fossil fuels.
If implemented, the system will be financed by a surcharge of under 0.01 cents per kilowatt-hour levied on electricity consumers.
According to the Ministry of Trade and Industry, draft legislation will be presented to Parliament this summer and the system may be introduced later this year.