Finland Denies 16 Offshore Wind Bids

May 6, 2024, by Adnan Memija

The Finnish government has issued a negative decision on 16 applications for exploitation rights concerning offshore wind power in the exclusive economic zone saying that many of the areas located in the Gulf of Bothnia overlap each other.

The applicants who received a negative decision are Halla Offshore Wind Oy and Laine Offshore Wind Oy (subsidiaries of OX2 Finland Oy); Navakka Offshore Ab and Wellamo Offshore Ab (subsidiaries of Eolus Offshore Ab); Skyborn Renewables Offshore Finland Oy; Ilmatar Vågskär Ab, Ilmatar Bothnia & Bothnia West Ab and Ilmatar Offshore Ab (subsidiaries of Ilmatar Energy Oy); Suomen Hyötytuuli Oy; and Pohjan Puhuri Oy and Pohjan Viima Oy (owned by a fund managed by Copenhagen Infrastructure Partners P/S).

The decision does not prohibit the development of offshore wind projects in the sea areas concerned.

The companies had applied for exclusive exploitation rights to use an area for offshore wind power for 40-70 years. The projects, for which the exclusive rights were applied, are at different stages of development.

Some projects have pending applications for a research permit that enables the applicant to begin research, while for others an environmental impact assessment is already well underway.

The Government’s justification for refusing the applications for exploitation rights includes its objective to create a predictable, clear and fair investment environment, the consideration of the overall interests of society, and the negative consequences that granting exploitation rights would have on the guiding effects of the new act under preparation.

According to the government, the applications for exploitation rights have been submitted under section 6 on the Exclusive Economic Zone in Finland.

Based on that, only consents to explore the project area have been granted to offshore wind projects so far, said the country’s Ministry of Economic Affairs and Employment. In addition, an offshore wind project requires a consent for the actual construction work referred in section 7, according to the press release.

“The applied rights of exploitation would be between these stages and, in accordance with the application, would guarantee an exclusive right to offshore wind power use in a certain area for a fixed period,” said the ministry.

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According to the ministry, the aim is that the decisions on offshore wind projects in Finland’s exclusive economic zone are based on clear rules. These rules will be defined in the legislative project on the exclusive economic zone currently under preparation.

The government’s goal is that the first areas for wind power projects in the exclusive economic zone could be selected and the first tendering processes launched at the end of next year based on clear rules under the new act.

The current act on the Exclusive Economic Zone does not take into account the special characteristics of offshore wind power, such as situations where several companies are interested in the same sea area. Based on the wording of the act, the government has considerable discretion on the exploitation rights contained in the act.

It does not lay down conditions under which a right of exploitation must be granted or an application should be rejected. Broad discretion enables the Finnish government to consider different aspects in its decision-making.

Legislative Draft to be Issued in May

The rules for offshore wind power will be clarified by implementing a legislative project under the leadership of the Ministry of Economic Affairs and Employment.

The ongoing legislative project will define the legislation, permit processes, compensation, and tax matters concerning waters belonging to Finland’s exclusive economic zone without delay, and these rules will be coordinated with the rules for projects carried out in territorial waters and land areas, according to the ministry.

The most important issues to be solved in the legislative project are the determination of exclusive rights through competitive tendering, the necessary permits that will replace the consents under the current Act on the Exclusive Economic Zone, and the specification of the legislation applicable in the exclusive economic zone, said the ministry.

The competitive tendering would be organised by the Energy Authority.