According to the Finnish Wind Power Association’s (FWPA) half-year review of wind power projects, in addition to onshore wind power, potential offshore wind power areas are also of interest to project operators. There are currently 13 offshore wind power projects planned, with a total output of nearly 13,500 megawatts. More than 3,200 MW more offshore wind power is under development than in the spring.
So far, offshore wind power has not been financially viable, so projects have been developed slowly. With the rapid cost reduction of offshore wind power, market-based profitability will be realized this decade, and interest in Finnish offshore wind power projects has grown significantly. During the last year, several offshore wind power projects have been launched, especially in the economic water area, i.e. international water areas controlled by Finland.
“It would be good for the next Finnish government to clarify the legislation on economic water areas, so that the operators would get an earmarked area for the development of offshore wind power project. Projects of different operators located in the same area mean double work in environmental impact assessment and seabed research. This is a waste of resources. The company should be allowed to reserve the area for itself even before the investigations are started,” says Anni Mikkonen, CEO of the Finnish Wind Power Association.
New offshore wind power projects are expected to be launched in regional waters, i.e. in the sea areas of the Finnish state, in 2023 and 2024, when Metsähallitus tenders project operators for the selected sea areas. FWPA feels it is important that Metsähallitus, in its monopoly position, develops projects with a large volume instead of individual projects.
With regard to offshore wind power projects located in regional waters, it is extremely important that the lowering of property tax for offshore wind power initiated by the current government to the same level as for onshore wind power proceeds in the next government term.
“The principles of offshore wind power’s property tax reduction have already been presented to the parliament, but the final legislative change was not scheduled to be completed this government term. It is a critical factor for improving the economic profitability of offshore wind power,” says Mikkonen.
The combined capacity of the onshore wind power projects under development is now 18% larger than in March 2022. According to statistics, almost half of the planned wind power projects are still being located in North Ostrobothnia, although the share of projects located in North Ostrobothnia has slightly decreased since March.
“However, it’s not that North Ostrobothnia has significantly lost projects, it’s just that more of them have been started elsewhere than North Ostrobothnia,” says Mikkonen.
The proportion of projects planned for South Ostrobothnia, Kainuu and Central Ostrobothnia has increased since spring. In regards of municipalities up to 12 different wind power projects are planned for Pyhäjärvi. The next most wind power production is under development in Oulu and Pudasjärvi.
A wind power project takes an average of 4-8 years
According to the plans, a total of 340 turbines (1800 MW) would be completed this year, a total of 250 turbines (1500 MW) next year, and at least 140 turbines in 2024. However, most of the currently planned projects are at a fairly early stage. Before the construction phase, the wind power project goes through several zoning and permitting processes, and some of the plans in the initial phase will fail due to reasons that prevent the construction of wind power in the area. Of the 6,859 turbines currently in the planning phase, more than a thousand have been permitted or are already under construction.
The known projects to be built in the years 2022-2025 mean investments of more than 6 billion euros in different parts of Finland. About 60% of the cash flows during the lifetime of the wind power project remain in Finland.
Finland’s energy self-sufficiency and security as well as the electrification of industry, transport and heating as well as P2X solutions require a lot of new, clean, domestic electricity production.
Wind power projects in Finland, October 2022
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