Upcoming New Act Governing Permitting and Construction of Offshore Wind Power within the Finnish EEZ

In November 2023, the Finnish Ministry of Economic Affairs and Employment (the “MEE“) appointed a working group tasked to prepare a new act (the “Act“) that will govern permitting and construction of offshore wind power within Finland’s exclusive economic zone (the “Finnish EEZ“)1. The MEE has now published an updated estimate on the timing of the legislative process as well as outlined a number of key elements of the contemplated Act.

Timing

  • Discussions between stakeholders (including project developers) and the working group take place during February 2024.
  • A draft government proposal regarding the Act is planned to be circulated for comments during May 2024.
  • The finalised government proposal is planned to be issued to the Finnish Parliament during fall 2024.
  • The Act will enter into force on 1 January 2025 at the earliest.

Key Elements of the Contemplated Act

Under the Act, the Finnish Government will retain its authority to decide which project areas located in the Finnish EEZ will be auctioned. The MEE will be responsible for ensuring that the planning of the project areas offered for auction is reconciled with the maritime spatial plan as well as that construction at the selected project areas is in the best interests of the society. Either the Finnish Energy Authority or, alternatively, Metsähallitus2 is currently envisaged to be appointed the entity responsible for arranging the auction process. Quality and pricing (i.e., fees paid to the State of Finland during production) will form the key criteria that is considered when selecting the auction winner. The winner will be granted an exploitation permit granting exclusive rights to research, exploit and specify the area for which permits required for construction of individual WTGs will be applied for. The Act is also envisaged to contain specific provisions for obtaining construction permits within the Finnish EEZ. This is because the new Finnish Construction Act, which will enter into force on 1 January 2025, does not in its current form apply to areas located within the Finnish EEZ.

The applicability of Finnish tax laws in the Finnish EEZ is currently being analysed by the Finnish Ministry of Finance. The outcome of the analysis could have effect on, among other things, structuring of offshore wind projects and investments. The applicability of Finnish employment legislation and legislation relating to waste management, rescue matters, electricity and gas markets as well as chemical safety in the Finnish EEZ is also currently under consideration. Moreover, the MEE is also considering whether it would be possible to include specific provisions regarding construction of hydrogen plants within the Finnish EEZ to the Act.

According to the MEE, no exploitation permit applications requesting for site exclusivity that have already been submitted to the Finnish Government have been so far approved. The MEE has not published any information regarding the timing for processing these permit applications.

Governmental Study on Promoting Offshore Wind in Finland

A governmental study aimed at presenting ways to promote the market-based development of offshore wind power in Finland in a cost-efficient and sustainable manner was also released in February 2024. The study assesses the placement of offshore wind power projects in the Finnish EEZ, the effects of the projects on each other as well as other activities at sea, and alternatives for electricity bidding areas located in the maritime area.

The results of the study will be used in the assessment of the placement of offshore wind power projects in the Finnish EEZ and as background material to support the updating work of maritime spatial planning and legislative work. The study has undergone an external scientific review and is available for free through the Finnish Government’s website.

Contacts

We are actively monitoring all legislative developments affecting the Finnish onshore and offshore wind sector and would be pleased to discuss any questions that you may have.

 

1 New Act Governing Permitting and Construction of Offshore Wind Power within the Finnish EEZ Under Preparation – Dittmar & Indrenius

2 Metsähallitus is a state-owned enterprise that manages land and water areas owned by the State of Finland and reconciles different goals of landowners, customers and other stakeholders. Metsähallitus is responsible for, among other things, arranging auction processes for project areas located within Finnish territorial waters.

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