Grid Connection for Energy Projects in Finland

While the Finnish power grid is generally high-performing, localised bottlenecks and capacity shortages exist in certain hotspots. Grid availability is often a temporary constraint, as power lines are continuously upgraded, and additional substations are built to meet growing demands. However, for many projects, the available grid connection remains the most crucial factor in terms of project timeline for achieving commercial operation.

Grid operators do not offer binding capacity reservations before a project has progressed significantly in development (typically until zoning has been completed). Therefore, it is crucial to assess available capacity early on and continuously monitor it throughout the development process.

In remote regions favoured by large projects, connection distances can be substantial. To address the financial and environmental challenges posed by these distances, an emerging trend is to create joint infrastructure arrangements with neighbouring projects. While this approach enables more business cases and fosters beneficial collaborations, it is essential to meticulously craft the contractual and corporate framework. This ensures that each participant project secures reliable access to the joint assets in a bankable manner.

The commercial viability of hybrid projects will often depend on whether and to what extent different assets can be operated “behind-the-meter”. The existing electricity market rules are somewhat restrictive and can easily lead to grid fees or grid operator obligations being triggered when production facilities, consumption units and/or energy storage interact with each other or the grid. This requires careful project design wherever different asset classes are involved. Legislative changes aimed at better accommodating hybrid projects are anticipated, but the specific details remain under consideration.