Finland to significantly ramp up offshore wind power production
On 8 July 2022, based on a proposal from the Ministry of Agriculture and Forestry, the Government decided to grant permits to Metsähallitus to lease state-owned water resources for wind power generation in the Korsnäs offshore wind farm project and the Tahkoluoto offshore wind farm expansion project. At the same time, with regard to the Korsnäs project, the Government granted permission to capitalise and invest a maximum of EUR 10 million in the wholly Metsähallitus-owned project company Korsvind Ab Oy, and to transfer the shares of the project company in stages in a manner to be agreed upon separately to a party selected as the project partner.
“This is a historically significant day. The permits granted today are an important milestone for the development of offshore wind power in Finland and for increasing our renewable energy production in the future,” said Minister of Agriculture and Forestry Antti Kurvinen.
“I would like to thank Metsähallitus for its very careful work on the permit preparations for the projects,” the Minister continued. “The two projects that have now received permits are also significant from the perspective of central government finances, as the lease income will ultimately flow to the State Treasury.”
The Korsnäs offshore wind farm project is a key renewable energy project in Finland. The project is the first offshore wind farm planned for an open sea area in Finland’s territorial waters. Once complete, its nominal energy production capacity will be close to that of the Loviisa nuclear power plant. The project costs are estimated to total EUR 1.5–2.5 billion.
The expansion of the Tahkoluoto offshore wind farm will increase its capacity from the current 10 wind turbines to 43 wind turbines and expand its area by about 14,400 hectares.
The role of Metsähallitus in offshore wind projects is to find sites suitable for wind power generation in state-owned marine areas, handle zoning arrangements for the sites and then transfer the project rights to other operators through competitive tendering. Metsähallitus does not participate in energy production directly or through its subsidiaries. The waters used for wind power production remain under state ownership, and Metsähallitus charges the operators a leasing fee determined on commercial grounds, which accounts for part of the income generated by Metsähallitus for the state. Along with income from leasing, offshore wind farms generate tax revenue for the state and property tax revenue for the municipality where the waters are located. Wind parks also have a significant employment generating impact in the region.
In line with its ownership policy, Metsähallitus aims to promote renewable energy production on state-owned lands and waters and to harness the potential of wind power while taking into account the various aspects of sustainability. So far, several sites suitable for wind power production have been identified in state-owned public waters controlled by Metsähallitus.
With regard to future offshore wind power projects, the Ministerial Committee on Economic Policy adopted an auction model for leasing public water areas to operators of new projects in December 2021. There has also been great interest in exploiting the Finnish exclusive economic zone, which is located outside Finland’s public waters and falls under the mandate of the Ministry of Economic Affairs and Employment, for wind power operations. However, developing the exclusive economic zone would require legislative amendments.
The Korsnäs and Tahkoluoto projects play a key role in promoting renewable energy production and in implementing the objectives of the Government Programme with regard to improving Finland’s energy self-sufficiency and achieving carbon neutrality.
Inquiries at the Ministry of Agriculture and Forestry
Erno Järvinen, Senior Ministerial Adviser, tel. +358 295 162 150, erno.jarvinen(at)gov.fi
Leena Arpiainen, Ministerial Adviser, +358 295 162 238, leena.arpiainen(at)gov.fi