Nordic Energy Market - Finland

Finland

Further information: Electricity sector in Finland and Energy in Finland

Cheap and reliable energy is of exceptional importance to Finland. The energy demand is high because of its cold climate and the structure of its industry. Finland's hydrocarbon resources are limited to peat and wood, while neighboring Norway has oil and Estonia oil shale. Until the 1960s, Finnish energy policy relied on the electricity produced by hydropower stations and extensive decentralised use of wood for energy. Finland's 187,888 lakes do not lie much above sea level – less than 80 metres in the case of the two biggest lakes, Saimaa and Päijänne. Consequently, Finland has less hydropower capacity than Sweden or Norway.

Finnish energy cooperative Teollisuuden voima operates four nuclear reactors that produce 18 percent of the country's energy. There is also one research reactor in Otaniemi campus and Olkiluoto Nuclear Power Plant, the fifth AREVA-Siemens-built reactor – world's largest at 1600 MWe and a showcase of new technology – is currently under construction. It was supposed to be finished by 2009, but won't be finished according to the newest approximations before 2016. Finland's Kyoto and EU emission terms are causing a sharp increase in energy prices and the existing reactors are aging: there has been talk about many more reactors and the sixth is already under environmental impact assessment.

Wind power would be by far the cleanest energy form in Finland (the existing hydropower plants excluded), but because political parties - particularly the True Finns - are hesitant to grant wind power permits, most energy is produced from fossil fuels, mainly coal and oil. About 25 percent of energy production is categorized to be renewable energy, which is high compared to the EU average 10 percent. About one fifth of all the energy consumed in Finland is wood-based. Industrial residue and garbage are often utilized for energy. Many homeowners use wood as an additional (but not primary) heat source. About seven percent of electricity is produced from peat harvested from Finland's extensive bogs.

Currently, some electricity is imported to Finland. In recent years, a varying amount (5–17 percent) of power has been imported from Russia, Sweden and Norway. The Norwegian and Swedish hydroelectric plants remain an important source for imported power. The current energy policy debate is centred on self-sustainability. There are plans to build a submarine power cable from Russia, but this is also considered a national security issue. The government has already rejected one plan for such a power cable. Neste Oil operates two large oil refineries for domestic and Baltic markets, refined products making 36 percent of chemical exports.