Finland is increasing the amount of electricity it produces through wind power in the near future. The goal is to increase the production of wind power to at least nine terawatt hours by 2025. Reaching this goal requires investments that are now being made not just with the support of state aid, but also under market terms and, for example through corporate power purchase agreements.
2.10.2018
Wind Power: More Clean Electricity under Market Terms Agreements
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This year, Finland made an even stronger commitment to renewable energy production when Parliament approved a new subsidy system. The system is based on a competitive tender process, which will also be open to wind power producers at the end of the year. Wind power is affordable, which means that it has great deal of potential. Given these circumstances, we expect that the tender process will also lead to an increase in wind power production.
Investments are now also increasingly being made under market terms. This is due to technological development, the increase in the annual output of power plants and an increase in the market price of electricity.
Corporate power purchase agreements (PPAs) have gotten a toehold in the Finnish renewable energy market. In a PPA, the electricity purchaser and producer agree in advance on the price at which the purchaser will buy the future output of a particular wind power plant. This allows the purchaser to support the production of renewable energy and meet the sustainability goals it has set for its own business. The wind power producer for its part gets certainty that the investment will be profitable without subsidies for the duration of the agreement and that it can safely make the decision to finance and build the wind farm.
Renewable energy also offers opportunities for traditional industry and wind power developers to collaborate. If it becomes easier for investors and developers to find one another, public subsidies may no longer be needed at all. We are following the development of the renewable energy market with interest and are proud to be involved in bringing innovative solutions into Finland.
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Latest references
DNA – 10-year power purchase agreement with Statkraft
We assisted DNA with their 10-year power purchase agreement (PPA) with Statkraft. The PPA enables DNA to buy 85 gigawatt-hours of clean energy per year from the new Palokangas wind farm, owned by investment firm Exilion Tuuli. The project, which will come online in late 2024, will generate 80% of DNA’s power needs. The Palokangas wind farm will be located in the Ostrobothnia region and equipped with 12 turbines.
Case published 15.8.2023
Oomi – Assistance with electricity market matters
We are advising Oomi Oy in questions relating to electricity market legislation, consumer protection and marketing law. Oomi is one of the largest electricity sales companies in Finland. The company sells electricity contracts, solar power systems and electric car charging solutions to consumers and businesses.
Case published 19.6.2023
Excelerate Energy – Chartering an FSRU to Finland
We advised Excelerate Energy on the conclusion of a lease agreement with Gasgrid Finland Oy for the Floating Storage and Regasification Unit (FSRU) Exemplar. The Inkoo LNG terminal project will have a significant impact on securing the supply of gas to Finland and Estonia as imports of pipeline gas from Russia cease. The Exemplar is the first FSRU in Finland and the Inkoo LNG terminal project is legally unique. Moreover, the project, which is critical for Finland’s and the Baltics’ gas supply, was completed in an exceptionally short timeframe. Our experts assisted the company in a wide range of areas including contracts, energy legislation, licensing, labour law, taxation and structuring.
Case published 9.6.2023
OX2 – Sale of stake in Finnish offshore wind development portfolio to Ikea’s Ingka Investments
We acted as the local legal advisor to OX2 in an arrangement whereby OX2 agreed with Ingka Investments, an investment company of the Swedish IKEA retail business, on the sale of a 49% stake in its three offshore wind projects in Finland. The three offshore wind projects, Halla, Laine and Tyrsky, are located in the Finnish Exclusive Economic Zone. The projects’ total annual production could amount to up to 29 TWh once operational, corresponding to more than one third of the electricity consumed in Finland in 2022. The aim is that the offshore wind projects start generating electricity by the turn of the 2030s. OX2 started developing the Halla and Laine offshore wind projects four years ago and was the first company to obtain exploration permits from the Finnish Government for its offshore wind projects. We have advised OX2 in the development and permitting of the offshore wind farm projects .
Case published 16.5.2023