Sector Outline Finland: Offshore Wind

Finnish offshore wind is an emerging industry with huge potential. Although the installed capacity is still modest, the pipeline is extensive, and project development has accelerated in recent years. The Finnish government considers offshore wind as the single most critical means of achieving the green transition.

Beneficial wind conditions, relatively shallow waters and lower salinity, as well as proximity to the coast make Finland ideally suited for offshore projects. Wind farm construction, installation and maintenance is considerably less complex and expensive compared to other regions such as the North Sea.

Finland’s expertise in shipbuilding, steel structures and maritime operations, including in arctic conditions, complements its fully developed coastal industrial sector. The ports are ideally positioned to support offshore activities and serve as strategic hubs for renewable energy projects.

Due to its higher capital-intensiveness, the offshore industry has been particularly attractive for major international players, many with know-how from offshore activities in other regions and a strong presence in the Nordics. In addition, large domestic players from the onshore sector are seeking to expand their operations into offshore.

The project pipeline encompasses both territorial waters and the Exclusive Economic Zone (EEZ). While the EEZ lies beyond state borders, Finland has exclusive rights for conducting economic activities there.

Within territorial waters, the sites for offshore projects are administered by Metsähallitus, a state-owned company, and use rights are granted based on auctions. In addition to the already auctioned offshore rights in Korsnäs, two projects – Ebba and Edith – are currently undergoing a tendering process, with plans to kick-start two more areas still in 2024.

Under Metsähallitus’ lead, the projects undergo a predevelopment and the preliminary endorsement of key authorities. Following the tendering, the selected developers continue their permitting, technical design and construction. The main steps along the permitting route resemble onshore development but individual prerequisites partly differ due to characteristics and interests specific to the sea context.

Use rights in the EEZ are currently being clarified. A draft government bill issued in May 2024 introduces a new tendering process and clarifications to permitting. In a nutshell, the government will pre-select certain areas for which companies (or consortia of companies) can submit tenders. Tenders will be awarded based on certain quantitative and qualitative criteria yet to be specified. The winner is granted exclusivity for procuring an exploitation permit that allows the use of the area for wind farm structures and related research activities. The first tendering process is anticipated to commence in late 2025, with a decision on exclusivity expected during the following summer.

Other ongoing developments include revisiting the property taxation for offshore projects. Furthermore, the Finnish government is investigating possible avenues for increasing the competitiveness of Finnish offshore wind.