Finland Risks Worst Power Cuts Since 1970s After Plants Shut

  • Power balance strained after PVO shuts coal, oil plants
  • Nation's new nuclear plant delayed by 9 years to 2018

Not since a strike among Finland’s power plant workers four decades ago has the risk of winter shortages been greater for the Nordic nation.

Pohjolan Voima Oy mothballed three generators last summer, and plans to switch off another in January, leaving the nation reliant on imports of as much as 3,400 megawatts during cold spells in the coming months, according to Fingrid Oyj, the network manager. That’s more than the capacity of Finland’s four nuclear reactors, which meet 27 percent of the country’s demand.

It’s the first time in nine years that Finland’s grid warned of a strained power balance before peak winter demand. With the nation’s new fifth reactor delayed by nine years and not expected online until the end of 2018, the country’s plight won’t change for another three years, according to the grid.

“This is the most challenging situation since the 1970s,” Mikko Heikkilae, a
market design specialist at Fingrid, said Tuesday by phone from Helsinki. “There was a strike at power plants and consumption had to be prioritized.”

Power prices in the Nordic market fell more than 60 percent after peaking in 2008 on Nasdaq OMX Group Inc.’s commodities exchange in Oslo.

Finland isn’t planning any short-term moves to add or keep thermal capacity as the risk for outages is low, Economy Minister Olli Rehn said by e-mail on Wednesday. In the longer term, the government will discuss plans for an added strategic reserve and move forward with a new third cable to Sweden.  

Poor Profitability

PVO shut coal- and oil units at the Kristiina, Tahkoluoto and Vaskiluoto plants with a combined capacity of 900 megawatts, cutting the country’s total capacity to 11,600 megawatts. Peak demand on a cold winter day is as much as 15,000 megawatts, according to Fingrid.

Fortum Oyj, the nation’s biggest utility, also closed its 1,000 megawatt Inkoo coal-fired power plant in February last year, citing poor profitability.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE