1.2.2024

Our new partners advise companies in energy transition projects throughout the project life cycle

Finland is in a good position to become a leading country in the energy transition when measured in both the number and value of investments, and the combined value of projects currently planned in Finland is billions of euros. Our new partners Jerker Pitkänen, Eveliina Tammela and Heidi Malmberg advise our clients in green transition projects throughout the project life cycle.

One-stop shop system is expected to streamline permitting processes

‘There is a lot going on in the energy sector at the moment, and it looks like new industrial plant and infrastructure projects are about to get started. As interest rates are settling down, companies can better predict changes in the operating environment this year, which is likely to give green transition investments and construction projects a much anticipated push,’ says Jerker Pitkänen, a partner in our International Construction & Projects service.

The Government is planning to streamline energy transition projects during this term by implementing a so called one-stop shop system. This system would, for example, centralise the permitting and supervision matters of renewable energy construction projects to one authority.

‘The one-stop-shop system is a great reform, and hopefully it also streamlines and harmonises permitting-related appeal processes. Time-consuming appeal processes are currently delaying the progress of projects,’ says Heidi Malmberg, a partner in our Environment, Infrastructure & Natural Resources service.

Thorough environmental impact assessment supports risk management

In green transition-related industrial plant and infrastructure projects, forecasting and planning are an essential part of risk management for both the project and business operations. During the planning phase, companies assess the project’s profitability, timeline and impacts.

‘The criteria set for the environmental impact assessment have become stricter in the past few years. For example, it is necessary to be able to assess the emissions to the environment accurately at a fairly early stage and to provide reliable information to support the assessment. This is challenging because at the time the environmental impacts are assessed, the planning of project details is only just starting. In the wind power sector, for example, wind turbine types are constantly developing,’ summarises Heidi.

Eveliina Tammela, a partner in our Corporate Crime & Investigations service, also encourages to be very accurate in the environmental impact assessment: ‘If the emissions exceed the limit values presented in the environmental permit application and confirmed in the environmental permit itself when the operations have started, the definition of an environmental crime may be met. And if a supervisory authority deems that the conditions included in the environmental permit are not fulfilled, a pre-trial investigation may be started in the matter.’

A directive on environmental crime is being prepared in the EU. The aim of the directive is to promote cross-border investigation and prosecution and to ensure effective sanctions for environmental crime. If the directive enters into force in its current form, a company that commits an environmental crime can be sentenced to a corporate fine linked to the company’s global turnover.

‘Companies should incorporate preventive work and risk management regarding environmental crime, also from the point of view of criminal law, into the company strategy and the planning of plant operations. If a company suspects that an environmental crime has been committed, internal investigation should be started immediately,’ advises Eveliina.

Delays in construction projects are common – precaution is advisable

The energy transition and renewable energy projects have been actively advanced in the Nordic countries in recent years but in many industrial plant projects, companies are facing the unknown. Testing and commissioning new technology take some time, so it is advisable to prepare for delays.

‘Green transition construction projects often involve new technology, which can make it difficult to predict how long different tasks and phases such as the commissioning will take. This means that the risk of delays also increases. It is difficult to completely eliminate the possibility of delays, but the related risks can be managed with well drafted agreements that take the special characteristics of the project into account. Managing the risk of delays requires an active approach during the term of the agreement as well: effective claims management, including, among other things, notices of defect, reserving rights and clear recordings of events, can at best prevent disputes and also improve chances of success if the matter is settled in court or in arbitration,’ summarises Jerker.

Our new partners have a wide range of experience in the planning and permitting of industrial plant and infrastructure projects, related project law and dispute resolution as well as criminal proceedings. Experience in industrial plant and infrastructure projects of various sizes enables Castrén & Snellman’s experts to anticipate and find solutions to legal issues that arise during the planning, construction or operational phase of a project.

‘Thanks to our full-service offering that covers all areas of business law, we can support our clients in any corporate risk management matters, administrative procedures, disputes and criminal proceedings,’ the partners conclude.