Finland to Limit Wind Power Development, Reduce Subsidy Costs

FINLAND - Finland plans to limit wind power developments and reduce subsidy costs, reining in a boom that exceeded government expectations.

The Ministry of Employment and Economy proposed changes to its feed-in tariff system, which sets price wind farms receive for their power, saying the shift may save 70 million euros ($78 million) to 80 million euros by 2020.

The country has a cap of 2.5 gigawatts for wind energy. The proposal is to make it mandatory for Finnish wind power plant developers to apply for a quota, a portion of this cap. If granted, the developer would then go on to apply for the feed-in tariff program with November 1, 2017 as the deadline. Applicants must have an existing wind farm to apply for new ones.

Finland’s wind industry experienced a boom in 2014 and 2015 that led to applications to build about 3.3 gigawatts, significantly over the cap. The country’s budget in 2015 for feed-in premiums for renewable energy is 214 million euros. Wind plants have accounted for 65 percent of this, said Anja Liukko, government counselor at the Ministry of Employment and Economy.

“The present system can no longer be considered a sufficiently cost-effective and market-oriented incentive system,” the ministry said in a statement. It is seeking to reduce these subsidy costs and estimates that they could stabilize in 2018 if the changes are implemented.

Finland’s goal is to get more than half of its energy to be from renewables in the 2020s. The ministry said that target is not in jeopardy.