Act on Offshore Wind Power in the Exclusive Economic Zone enters into force – First tenders could be organised at the end of 2025
On 19 December 2024, the President of the Republic approved the Act on Offshore Wind Power in the Exclusive Economic Zone. The Act will help promote offshore wind power in the exclusive economic zone, clarify the regulation of offshore wind power projects within the zone and ensure that the rights to the exploitation of offshore wind power are granted in a fair, transparent and predictable manner.
Offshore wind power projects in the exclusive economic zone are still in the planning stage. The Act will clarify the regulation of projects in the exclusive economic zone, which until now has been deficient. The new legislation will promote a predictable and encouraging operating environment as well as smooth project development and construction. It will also make it easier to ensure that offshore wind power is compatible with other uses of the marine areas, such as maritime transport and fishing.
The legislative amendments will implement the objective of the Government Programme to clarify the rules for offshore wind power in Finland’s exclusive economic zone. The Act will enter into force on 1 January 2025. The new legislation will not cause any changes to Finland’s territorial waters.
Government to select offshore wind power areas – Energy Authority to be responsible for competitive tendering
The exclusive economic zone of Finland is an international sea area that the State of Finland has the right to exploit economically. Under the new Act, the Government may select areas in the exclusive economic zone that are suitable to be used for offshore wind power and make decisions concerning competitive tendering for these.
It will be easier to coordinate the maritime activities within the zone if the offshore wind power areas are selected by the Government. Environmental factors and other uses of the marine areas, especially maritime transport routes and fishing, can be taken into account better in the selection. Until now, companies have proposed suitable areas.
The tendering process consists of three parts: 1) The Government selects the offshore wind power areas, considering the overall interests of society; 2) the Energy Authority organises the competitive tendering of the areas; 3) the winner of the tendering is granted the exclusive right to apply for an exploitation permit from the Government for a certain area. The exploitation permit grants the offshore wind power project the right of use in the area for a fixed period of time.
The competitive tendering model for offshore wind power area proposed by the Government was slightly amended during the parliamentary process. Under the amended model, if the winner of the competitive tendering does not apply for an exploitation permit, the second-best tenderer will be able to apply for one. In addition, the restriction that one tenderer may win only one tender even in situations where tenders for several areas are organised at the same time was removed.
An exploitation permit alone does not mean that the project will be implemented as this requires other permits as well. The Act also specifies which national legislation applies in the exclusive economic zone. Thanks to the competitive tendering model, it will be possible to influence the process to ensure that the company that gains the right concerning the area is also capable of carrying the project through.
The parliamentary reply to the Government's proposals also includes a resolution according to which Parliament requires the Government to streamline the water permit process as concerns offshore wind power.
What’s next?
The next step is to implement the new Act. An important part in the initial phase is to prepare the selection of offshore wind power areas. This preparatory work includes cooperation with the coordination group for offshore wind power and the selection of areas involves an environmental impact assessment (SEA). The aim is to decide on the first areas to be tendered in autumn 2025.
Preparations for a government decree to be issued under the new Act on offshore wind power in the exclusive economic zone will also continue in the spring. A key element of the decree are the criteria used for selecting the winners of tenders.
In early 2025, the Ministry of Economic Affairs and Employment will organise stakeholder events on the selection criteria concerning environmental factors and other factors contributing to the acceptability of the project. The decree will be drafted so that it will enter into force before the start of the first competitive tendering. The Energy Authority can organise competitive tendering once the Government has decided which areas will be tendered. This will take place towards the end of 2025, at the earliest.
Inquiries:
Tuuli Oikarinen, Senior Specialist, Ministry of Economic Affairs and Employment, tel. +358 295 047 292
Outi Vilén, Chief Specialist, Ministry of Economic Affairs and Employment, tel. +358 295 047 016