Finland’s wind power industry has seen tremendous growth thanks to production subsidies, but experts believe that past mistakes should be taken into consideration when attracting new green investments. According to Pekka Ripatti, director of the Energy Agency, and Kimmo Ollikka, a researcher at the State Economic Research Center, it is crucial to learn from the past in order to make future investments sustainable.
In 2011, Finland introduced a feed-in tariff for wind power production that guaranteed a price to plant builders. However, this proved too generous, especially for plants built just before the support system ended in 2017. The rapid technological advancements in wind power made construction cheaper, but the promise of a 12-year price support remained the same. As a result, subsidies were higher than necessary.
Experts believe that considering actual production costs when planning subsidies is essential. In 2018, an auction was held where subsidies for renewable energy production were sold competitively for a much lower price than the feed-in tariff. This highlighted the significant drop in wind power construction costs due to technological development.
When it comes to early-stage technologies, targeted support for experimentation is beneficial. However, as technology nears market readiness, leveraging market information becomes essential for effective investments. The Ministry of Labor and Economic Affairs’ recent grant to Suomen Hyötytuule for offshore wind farm construction exemplifies this approach.
In conclusion, while Finland’s wind power production subsidies have provided substantial support to the sector
