Most of Finland’s hydropower resource has already been used; there is potential for about 1 TWh/yr more. Biomass is used intensively by the pulp and paper industry, raising the share of biomass-produced electricity to 10% in Finland. There is still biomass potential available, and this is reflected by the national energy strategy, which foresees biomass as providing most of the increase in renewables.
Wind energy potential is located mostly on coastal areas. There is a huge technical potential offshore, with ample shallow sites available. Offshore, nearly 10,000 MW of wind power potential has been identified in the process of renewing regional plans in Finland.
A feed-in premium has been proposed to begin in 2010 to promote investments in wind power. A guaranteed price of 83.5 €/MWh has been proposed for wind power. The difference between the guaranteed price and spot price of electricity will be collected from the consumers and paid to the producers as a premium.
Progress Toward National Objectives
The progress in wind power capacity has been slow compared with other European countries. The funds available for investment subsidies have been inadequate to achieve any large increases in wind-power capacity. From 2005 to 2008, no specific goal for wind power was set. The new target proposed in the climate and energy strategy in 2008 is 2,000 MW of wind power in 2020. This would be about 6% of the total electricity consumption in Finland. A new subsidy system is proposed to start in 2010. This reflects the increased targets for renewables arising from the EU target of 20% of energy consumption from renewable sources in 2020. The target for Finland is 38% of final energy consumption by RES (current RES share 28.5%).
Eleven new turbines totaling 33 MW were installed, bringing the total capacity to 143 MW at the end of 2008 (30% growth from the previous year). Total wind energy production in 2008 increased by 38% compared to 2007. The production of 260 GWh corresponds to 0.3% of the annual gross electricity consumption of Finland.
There were 118 wind turbines in operation in Finland at the end of 2008. The average wind turbine size is 1,210 kW. About 37% of the equipment originates from Denmark, 20% from Germany, 39% from Finland, and 4% from the Netherlands. The size of the installed capacity ranges from 75 kW to 3 MW. The eleven new turbines installed in 2008 were all 3 MW turbines. Only a few projects could still be built n 2009, (1 MW in Ii, 3 MW in Pori, and 12 MW in Hamina), but more than 80 MW received investment subsidy decisions in 2008 and in the first part of 2009.
There are a huge number of projects that are planned, under feasibility studies, or have just been proposed: 1,300 MW onshore and 4,700 MW offshore. Several large offshore project plans were published in 2007 and 2008, and Environmental Impact Analyses have been started for Suurhiekka (400 MW), Oulu-Haukipudas (500 MW), Maakrunni (350-450 MW), Pitkämatala (800-900 MW), Oulunsalo-Hailuoto (150-210 MW), and Raahe (300-500 MW) on the Northern part of the West coast, as well as Kristiinankaupunki (240-400 MW), Siipyy (about 250 MW), and Inkoo (180-300 MW) on the Southern part of the West coast. Pori offshore demonstration is the closest to the building phase (100 MW). The largest onshore projects are in Tornio (28 MW), Muonio (30-40 MW), Raippaluoto (45 turbines), Teuva (30 turbines), Kristiinankaupunki (45 turbines), Ilmajoki (20 turbines), Maalahti (35 turbines), Raahe (30 turbines), and Närpiö (30 turbines).
The Åland islands between Finland and Sweden constitute an autonomous region with its own legislation, budget, and energy policy. Wind energy deployment there is steady and, considering the population, the targets are ambitious. Wind energy was expected to cover 10% of electricity consumption in the region by 2006. This figure stood at 23% in 2008 for the 22 MW installed and will further increase as 18 MW Eckerö project will be built in 2010. The environmental benefit of wind power production in Finland is about 0.2 million tons of carbon dioxide savings per year.
Benefits to National Economy
Most of the turbines in Finland are located along the coast and are owned by power companies and local energy works. Green electricity is offered by most electric utilities; however, the marketing is not very active. In 2008, the companies reported thousands of new customers for the renewable electricity products. The supply of used turbines from the first demonstration projects in Finland and from the Netherlands has encouraged some farmers to acquire second-hand turbines—they are located inland where the wind resource is limited at heights below 60 m.
Good sites for larger wind farms on the coastal areas are scarce. This is one reason for interest in offshore projects. The first semi-offshore projects were built in 2007 (six 2.3-MW turbines in Åland Båtskär) and 2007-08 (ten 3-MW turbines in Kemi, of which 12 MW are offshore). A demonstration project in Pori is still in the planning phase (100 MW).
Industrial development
The Finnish manufacturer WinWinD presented its first 1-MW pilot plant in spring 2001 and erected the 3-MW pilot plant in 2004 in Oulu. Their turbines operate at variable speed with a slow speed planetary gear box and a low-speed permanent magnet generator. This solution combines the best features of a direct drive and gear system, producing efficient and reliable turbines.
By the end of 2008, WinWinD had installed 142 MW in seven different countries including Estonia, France, Portugal, and Sweden. WinWinD has manufactured 39% of all the turbines in Finland (57 MW). In 2008, the number of employees grew to 270 (190 in Finland). WinWinD has two manufacturing facilities in Finland. An assembly plant for 3-MW turbines is currently being constructed in Hamina, Finland. An assembly and blade manufacturing plant for 1-MW turbines is starting operation in 2009 in Chennai, India. The main owner of WinWinD since 2006 is Sterling Group (India) and in 2008 Masdar (Abu Dhabi) became a major shareholder, too. This has led to a steady expansion in the company and an increase in the production capacity to meet the demand for turbines.
Several industrial enterprises have developed important businesses as suppliers of major components for wind turbines. For example, Moventas Oy (earlier Metso Drives Oy) is the largest independent manufacturer of gears and mechanical drives for wind turbines. ABB Oy is a worldleading producer of generators and electrical drives for wind turbines. The Switch company supplies individually tailored permanent-magnet generators and full power converter packages to meet the needs of wind turbine applications, including harsh conditions. Hollming has an assembly plant for wind turbines and components in Loviisa.
The 3-MW WinWinD turbines, as well as direct-drive generators for the Switch company, are assembled there. In addition, materials such as cast-iron products, tower materials, and glass-fiber products are produced in Finland for the main wind turbine manufacturers. The total turnover has grown to about 1,000 million € according to the industry’s own estimates. The manufacturing industry has a branch group under Technology Industries in Finland, to promote technology development and to export wind technology. The benefit to the national economy was estimated by the wind technology manufacturing industry under Technology Industries in Finland in its road map for wind power technology in November 2005.
According to the calculations, investing a total of 220 million € for wind energy from 2006 to 2020 could result in raising the yearly wind technology exports from 200 million € to 1,400 million €/yr in 2020 and creating 18,000 new jobs. According to this scenario, the total investment for wind power in Finland would be 100 million €/yr on average from 2006 to 2020 (1,500 MW), and this would result in a carbon dioxide reduction of 7 million tons during those years (10 TWh total).
Operational experience
According to the statistics portrayed, performance of wind power production has improved. The average capacity factor was higher between 2000 and 2006 than it had been in the 1990s, even though the FMI wind energy production index has been lower in recent years. This improved production is mainly because more megawatt-scale machines are reaching a higher wind resource. The average availability of wind turbines operating in Finland was 96% in 2008 (94% in 2007). Two old 300-kW turbines were not operational all year after gearbox problems late in 2006 – they are now up for sale. There were not many large failures in 2008: three generator failures, one blade failure, and one gear-box failure were reported
from the 96 turbines reporting.
Economic details
On coastal sites in Finland, the cost of wind energy production could be about 50 to 80 €/MWh without subsidies (15 years, 7% internal rate of return), while the cost of offshore production could be about 80 to 100 €/MWh. The average spot price in the electricity market Nordpool was 51 €/MWh in 2008 (30 €/MWh in 2007).
Emission trade effects on the operating costs of thermal power have resulted in an increase of spot market prices, however, emission permit prices have been volatile and future and forward prices are about 40 €/MWh for 2009-2010. Wind power still needs subsidies to compete even on the best available sites. All wind energy installations are commercial power plants and have to find their customers via a free power market. In most cases, an agreement with a local utility is made that gives market access and financial stability. Several companies offer green or specifically wind electricity certified by the Association for Nature Conservation.
A feed-in premium for wind energy has been proposed, and this would greatly increase the wind power market in Finland. A guaranteed price of 83.5 €/MWh is currently proposed for wind power, where the difference between the guaranteed price and a three-month-average spot price of electricity will be collected from the consumers and paid to the producers as a premium. This is a system that fits the Nordic electricity markets, as the producers will sell their energy in the market or by bilateral contracts, and account for the balancing costs for their production.
National Incentive Programs
As the main incentive to promote wind investments, an investment subsidy of up to 40% has been possible depending on the level of novelty of a wind energy installation. In addition to the investment subsidy, a tax refund of 6.9 €/MWh is awarded. A new incentive system based on a guaranteed price has been proposed in 2009.
Projects that applied for a subsidy between 2001 and 2006 received an average investment subsidy of 35%. In 2008, investment subsidies were granted to two projects with offshore foundations developed for ice infested waters (subsidy of 1.6 million €, representing 35% of the total investment). To speed up wind power development, additional funds for investment subsidies have been made available for 2009. Already by April 2009, more than 13 million € have been granted, and 80 MW had received an investment subsidy decision by June 2009.
In 2007, the EU published a target of 20% of energy consumption to be sourced from renewable energy in 2020. The target for Finland was set to 38% of final energy consumption by RES (current share 28.5%). The new climate and energy strategy given by the government in 2008 has a target of 2,000 MW of wind power in 2020. A change in the incentive program is currently prepared: a feed-in premium for wind power, biogas, and possibly other RES.
A guaranteed price of 83.5 €/MWh has been proposed for wind power, where the difference between the guaranteed price and spot price of electricity will be collected from the consumers and paid to the producers as a premium. This proposal, from April 2009, has yet to be approved by the government and the parliament to enable the new incentive system. A three-month average spot price has been proposed as the comparison price to determine the payments to the producers (the guaranteed price minus the average spot price). Should the (average) spot price rise to above the guaranteed price, the producers will get this higher price.
Wind power producers will be responsible for their forecast errors. If the impacts of emission trading continue to raise electricity market prices, this will reduce the consumer payments for this subsidy. An increased level of guaranteed price for the first projects, a reduced level of guaranteed price for new projects during the later years, and a special subsidy for offshore wind power will still be
considered.
A new wind atlas is currently being developed by FMI with government budget funding, and will be published at the end of 2009. This will help reduce uncertainty when estimating the production potential of the taller multi-megawatt machines in the forested coastal areas of Finland. An addition to the electricity market act was approved in 2007 where a ceiling to the distribution network charges was set for distributed generation, including wind. The distribution charges vary across the country and in some areas have hindered local generation.
The act also stated that grid reinforcement payments must be borne by the consumers, not by the producer. Before becoming effective in February 2008, project size for grid reinforcement exemption was limited to 2 MW from the original 20 MW. This means that the promoting effect of the grid reinforcement exemption will remain small for wind power.
Wind energy deployment is slow in Finland, but even so there is discussion of the environmental impact of wind turbines. Land-use restrictions and visual pollution, especially in relation to summer residents and vacation activities, might yet prove a significant obstacle to development.
To overcome these problems, the Ministry of Environment published guidelines for planning and building permission procedures for wind power plants. Sites for wind power have been added to regional plans by the authorities. This will help future wind power projects. Large areas mostly offshore have already been added for the Gulf of Bothnia, North (about 4,000 MW), and the Gulf of Finland, West (about 200 MW). The planning process is ongoing for the Gulf of Bothnia, South, and the Gulf of Finland, East.
R, D&D Activities
Since 1999, Finland has not had a national research program for wind energy. Individual projects can receive funding from the National Technology Development Agency (Tekes) according to the general priorities and requirements for technical R&D. Benefit to industry is stressed, as is the industry’s direct financial contribution to individual research projects. Priority is given to product development and the introduction of new products. National projects for collaboration with IEA Wind Tasks 19, 21, 24, and 25 have been under the DENSY program (Distributed Energy Systems) (2003–2007).
The VTT Technical Research Centre of Finland is developing technologies, components, and solutions for large wind turbines. An icing wind tunnel for instrument and material research and testing in icing conditions was put up in 2008. Industrial collaboration in the development of reliable and cost-efficient solutions for drive trains and ice prevention systems in large wind turbines has been started.
Of the 3.5 million € granted for wind power projects in 2008, only 0.4 million € was for public research (like the national projects for IEA Wind Tasks), and the rest was for company projects for wind technology development. WinWinD has developed 1-MW and 3-MW turbines for different weather conditions. ABB has developed a direct-drive multi-pole permanent-magnet wind turbine generator. The Switch company is developing multi-megawatt generators and a modular series-connected frequency converter. Moventas has several projects on gearbox load management. Pem-Energy Oy is developing small wind turbines. Hoxville has developed an embedded condition monitoring system to be used in wind turbines.
VTT has been active in several international collaborative projects in the EU, Nordic, and IEA frameworks. As part of the EU project Tradewind (2006-2009), VTT estimated the impact of wind power on cross border flows in the European power system. As part of the EU project UPWIND, technologies to control the shape of composite structures were developed at laboratory scale. In 2008, VTT implemented a phenomenological macroscopic SMA-material model iRLOOP, created at the Czech Academy of Science, into Matlab and ABAQUS. Development toward a plug-and-play type adaptive trailing edge which includes all needed sensors and actuators has started.
The Finnish Meteorological Institute (FMI) has been active in EU collaboration for wind and ice measurement technology. FMI is coordinating the COST collaboration “Measuring and Forecasting Atmospheric Icing of Structures,” in which VTT is also participating. Nordic Energy Research has two projects related to wind energy: VTT is participating in a grid integration project, and VTT and FMI are participating in a project investigating how climate change affects renewable energies. VTT is taking part in the following IEA Wind research tasks:
• Task 11 Base technology information exchange
• Task 19 Wind energy in cold climates (operating agent)
• Task 24 Integration of wind and hydropower systems
• Task 25 Design and operation of power systems with large amounts of wind power (operating agent).
Wpd Finland together with Motiva are participating in Task 28 Social acceptance of wind energy projects. Work on Task 19 wind energy in cold climates also has links to cold climate technology development in some Finnish industrial projects.
The Next Term
Up to 16 MW of new capacity will be added in 2009. In addition, projects totaling nearly 6,000 MW are in various planning phases in Finland. If the feed-in premium takes effect in 2010, a strong growth of the wind power market in Finland is anticipated.
A new wind atlas is currently under development by FMI with government budget funding and will be published at the end of 2009. This will help to reduce uncertainty when estimating the production potential of the taller multi-megawatt machines in the forested coastal areas of Finland.
A next-generation blade heating system is being developed in Finland, which will enable the use of the wind resource potential at arctic fell areas in Finland. Increasing global demand for ice-free turbines is foreseen.
Authors: Hannele Holttinen and Esa Peltola, VTT Technical Research Centre of Finland, Finland.
