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Atomic Reactor Supplier May Fill Void EON Left in Finnish Power

Fennovoima Oy may ask a nuclear reactor supplier to join its project to build a new atomic unit in Finland after Germany’s biggest utility EON SE sold its stake in the venture today, its chairman said.

“Some potential suppliers have said in public that they are interested in taking part in the project,” Pekka Ottavainen, Fennovoima’s chairman and managing director of the main shareholder Voimaosakeyhtioe SF, said by phone from Helsinki. “The end result depends on who we buy the reactor from. We don’t rule out any option.”

EON sold its 34 percent holding in the project for an undisclosed sum to Voimaosakeyhtioe, a group of 61 companies that now owns all shares in Fennovoima, the Dusseldorf-based utility said in an e-mailed statement. Fennovoima is prepared to consider inviting one of the potential reactor suppliers Areva SA or Toshiba Corp. on board as shareholders, after EON pulled out, the company said.

“The project continues as planned,” Ottavainen said. “We’ll pick a reactor supplier by the end of this year.”

Utilities are pulling out of nuclear projects across Europe as financial constraints and uncertainty over energy prices increases risk. EON said on Oct. 24 it would exit Finland to focus on operations in Sweden and Denmark. It had in September 2011, along with SSE Plc and RWE AG, decided to give up building nuclear plants in the U.K.

Fennovoima plans to begin construction of a 1,600-megawatt to 1,800-megawatt reactor at Pyhaejoki in northern Finland in late 2016, with the aim of completing the project in five years. Local utilities hold stakes in the venture along with steelmaker Outokumpu Oyj, which has 10 percent.

Power Gap

Fennovoima will sell power from the reactor at production cost to shareholders for the lifetime of the plant. EON’s exit increases the risk that the project may fail, thwarting the government’s plans to cut reliance on energy imports, five analysts surveyed by Bloomberg said in October.

Failure to complete the project will leave an annual gap of at least 12 terawatt-hours in Finland’s future power supply, or about 14 percent of current demand, according to data from the country’s energy industries association’s website. The Nordic country imported a record 20 percent of the power it used last year, as it lacks the oil and hydropower supplies of neighbors Russia and Norway, the organization said.

Atomic energy serves Finland’s power-intensive export industries, including paper and pulp production, chemicals and basic metals, according to the International Energy Agency.

Finland’s nuclear expansion also includes Teollisuuden Voima Oyj’s construction of the 1,600-megawatt Olkiluoto-3 reactor and a planned fourth unit at the site. Olkiluoto-3 will be the world’s biggest once completed in 2016, about seven years behind schedule, according to TVO’s forecast.

To contact the reporter on this story: Torsten Fagerholm in Helsinki at tfagerholm@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net

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