Finland rejects undersea electricity cable from
Dec 23, 2006 - Business and Finance
Finland's Minister of Trade and Industry,
Mauri Pekkarinen, announced on Tuesday that Finland
would not allow the construction of an undersea electric
cable from Russia to Finland.
The decision was finalised in the government's
ministerial committee on economic policy.
The Russian-led United Power sought
permission to export electricity to Finland through
a cable with a capacity for 1,000 megawatts. The cable
was to have run from Kernovo at the southeast end
of the Gulf of Finland, near the Russian Sosnovyi
Bor nuclear power plant, to Kotka in the southwest
United Power submitted its application
to the Ministry of Trade and industry over two years
Pekkarinen said that perhaps the most important reason
for rejecting the application was the effect that
it would have had on Finnish self-sufficiency in electricity
According to Pekkarinen, Parliament
has emphasised this autumn that Finland must be more
self-sufficient than before in the production of electricity.
"If it were implemented, the cable project
would have especially reduced domestic co-generation
of electricity and district heat, and would have significantly
slowed down the implementation of new domestic energy
solutions. All of this would mean the reduction in
production of electricity using domestic sources from
the present level of 34 per cent. This would not be
a good development", Pekkarinen explained in a press
release of the Ministry of Trade and Industry.
Pekkarinen added that the undersea cable project would
have required EUR 1.5 billion in investments in strengthening
the carrying capacity of the Finnish electricity grid.
The ministry also considered the likely
availability of electricity in northwest Russia, and
concluded that the applicant had not demonstrated
convincingly that an uninterrupted flow of power could
be guaranteed in all circumstances.
Leaders of Finland's political parties were largely
in agreement with the decision to reject the cable
Social Democratic Party Chairman, Minister
of Finance, Eero Heinäluoma, felt that the decision
was the only option for securing Finnish energy supplies.
He said that the sea cable would not have been a sufficiently
reliable source of electricity during cold periods.
Heinaluoma pointed out that Russia also
has a growing need for energy, and that therefore,
increasing dependence on Russia for energy would be
risky for Finland. He also noted that existing Russian
exports of electricity to Finland broke down on a
couple of occasions for technical reasons last year.
He echoed Pekkarinen's view that Finland needs to
produce more electricity itself, using renewable sources.
Leaders of opposition parties were also largely in
agreement with the government's decision.
Only Matti Korhonen of the Left Alliance
would have wanted to allow the cable, saying that
it would bring more competition to the energy market
and help lower prices.
However, Korhonen welcomed the fact
that the decision would probably promote domestic
National Coalition Party leader Jyrki
Katainen said that in this case, more important than
an increase in competition and lower prices is that
Finland prepares to produce more energy on its own
that is "climatically sustainable", and to develop
new technology for the purpose.
The National Coalition Party is the
only political group that openly supports the construction
of a sixth nuclear generator. Katainen has also called
for more input into the use of biological energy sources.
Green League chairwoman Tarja Cronberg said that the
decision was "very good". Like the other leaders,
Cronberg said that she hopes that the decision would
lead to investments into renewable domestic forms
She added that it is very good that
Finland does not buy Russian electricity that is produced
by nuclear power. She also said that it is important
not to make Finland more dependent on Russia for energy.