Finland has launched a technology-neutral renewables tender for up to 1.4 terawatt hour in annual non-hydro output with a support system that mixes fixed and sliding premia and caps overall remuneration at €53.5 ($61.1) per megawatt hour – about the level of current wholesale power prices.

Bidders with projects in onshore or offshore wind, PV, tidal/wave power, biogas and biomass can hand in bids until year-end, if their projects are slated to produce at least 800MWh per year and up to 1.4TWh. Support will be granted for 12 years.

The auction volume according to earlier estimates by the Finnish Wind Power Association could translate into roughly 420 – 560MW in onshore wind capacity to be added in case onshore wind would win all of it.

Interested parties can bid for a premium on top of a wholesale electricity price in the NordPool area of €30/MWh, with overall remuneration capped at €53.5/MWh. If the wholesale price is at or below €30/MWh, the fixed premium bid for will be paid fully.

If it is above €30/MWh, only the part of the premium will be paid to reach the level of €30/MWh plus the bid amount. If the wholesale electricity price is above that level, no premium will be paid on top of the electricity price. No support is paid either in case of negative electricity market prices.

The overall cap in the current situation of electricity markets would mean that no support would be paid if onshore wind wins all of the tender.

In the third quarter of 2018, the average spot price in the Nord Pool power exchange for Finland was €53.5/MWh, up from €35.9/MWh a year earlier, according to Finnish utility Fortum.

Rising power prices in the Nordic region have also made developers bolder to propose subsidy-free onshore wind from the onset. Wind OEM Vestas last week announced an order from CPC Germania to supply 12 of its V150-4.2 turbines to the 50MW Lakiakangas II wind project in Finland.

According to the Finnish Wind Power Association, there are already 300MW of onshore capacity under construction without financial support, which are slated to come online 2019.

Falling costs for onshore projects could also make it difficult for offshore wind to have a chance in the tender.

The country’s first 42MW offshore wind array at Tahkoluoto in the Bay of Bothnia in the Baltic Sea that was completed last year has an estimated levelised cost of energy (LCOE) of about €60/MWh, which is above the overall remuneration cap of the tender.

Using much larger offshore turbines than the 4.2MW Siemens Gamesa machines employed at Tahkoluoto for a planned future expansion of the array of about 300MW, that LCOE could be pushed down considerably, the projects managing director, Toni Sulameri from developer Suomen Hyötytuuli told Recharge last year.

Grid connection costs need to be included in bids, and developers must have a binding spatial plan and building permit as well as a binding offer for the grid connection from the grid operator. Another hurdle for offshore is that at least part of the winning project should start producing electricity within three years after the bid is won, or facing a penalty.

Repowering is allowed as long as the tower and nacelle are exchanged. Projects in the Åland archipelago between Sweden and Finland cannot participate.

Wind

Finland launches 1.4TWh/year tech-neutral renewables tender