Wind Power New Opportunities for New Energy Marget Players in Finland Jari Suominen Jari.suominen(at)tuuliwatti.fi www.tuuliwatti.fi
Lead markets Statistics 2020 Scenarios Biggest EU markets: Cumulative: n 1 Germany n 2 Spain n 3 Italy n 4 France n 5 United Kingdom n 6 Portugal n 7 Denmark n 8 Sweden n 9 Ireland n 18 Finland Annual (2009): n 1 Spain (2.459 MW) n 2 Germany (1.917 MW) n 3 Italy (1.114 MW) n 4 France (1.088 MW) n 5 United Kingdom (1.077 MW) n 6 Portugal (673 MW) n 7 Sweden (512 MW) n 8 Denmark (334 MW) n 9 Ireland (233 MW) n 19 Finland (4 MW) n 1 Germany (49.000 52.000 MW) n 2 Spain (39.000 42.500 MW) n 3 United Kingdom (26.000 34.000 MW) n 4 France (23.000 26.000 MW) n 5 Italy (15.500 18.000 MW) n 6 Poland (10.500 12.500 MW) n 7 The Netherlands (9.500 11.400 MW) n 8 Sweden (9.000 11.000 MW) n 9 Portugal (7.500 9.000 MW) n 10 Greece (6.500 8.500 MW) n 11 Ireland (6.000 7.000 MW) Denmark (6.000 6.500 MW) n 18 Finland (1.900 3000 MW) Source: EWEA
Content Feed-in Tariff Strengths and Weaknesses Investment Barriers and Opportunities TuuliWatti Business Case
Content Feed-in Tariff Strengths and Weaknesses Investment Barriers and Opportunities TuuliWatti Business Case
The law proposal for feed-in tariff system The government has given the law proposal to parliament in 17.9.2010 Will be handled in cabinets first, then voted in parliament Fixed quaranteed price, 83,5 /MWh for 12 years Until the end of 2015 higher level 105,3 / MWh, max 3 years New turbines, which have been installed before 1.1.2009 included Minimum size 500 kw Funding from the governmental budget An additional tariff or other subsidy system may be introduced later for off-shore wind enabling at least demo projects (< 100 MW) Starts in 2011
Guaranteed market price Market Price Average market price Guaranteed price Guaranteed price Premium is paid quarterly Minimum level 30 /MWh Producer is responsible for the sale of electricity to the market Producer is responsible for the electricity balance and it s costs
Strengths and Weaknesses 300 280 260 240 220 200 180 160 140 120 100 80 60 40 20 0 2 4 Asennettu kapasiteetti (MW) Tuotanto (GWh) Tuotantoindeksi, IL (%) 11 11 17 7 5 6 7 12 49 24 17 77 70 63 92 120 168 153 38 38 39 43 52 82 82 86 188 276 261 147 142 109 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Investment support system was not efficient System is technology and location neutral, forcing investments to most cost efficient locations Cost efficient way to reduce fossil energy use in electricity production and decreases electricity costs more than costs as overall support Support costs likely to decrease/disappear during the system life time due to the increase in electricity market prices The level is high enough for onshore projects, but not for offshore or inland projects Risk of low electricity prices? When will the target be reached?
Content Feed-in Tariff Strengths and Weaknesses Investment Barriers and Opportunities TuuliWatti Business Case
New Wind Atlas Wind Atlas 1991 61 observation points Today: 191 weather stations New Wind Atlas: 54 200 points á 2,5x2,5 km2 + 867 000 points á 250x250m (onshore)
Developing a wind farm in Finland Find the right area Wind Atlas National parks etc close by? Where is the closest grid connection point? Negotiations with land owners Negotiations with the TSO (Fingrid) Negotiations with the authorities Wind speed measurements Radar effects Regional land use plan (Regional Council) Local master plan (Municipality) Local detailed plan (Municipality) New law proposal to simplify the process
TuuliWatti Oy - General principles To build cost efficient wind electricity production to Finland Sustainable production which takes into account social and environmental values of potential locations Focusing on projects, which are either linked to the nearby coast line onshore windfarms or integrated into existing infrastructure like harbours, industrial areas etc.
Porin tahkoluoto existing infrastructure
Flat forest areas typical in Finland
Barriers and Opportunities Large country with few people and long coastline With the feed-in tariff, new Wind Atlas and the projects published so far, there will be high investments in the wind sector in Finland before 2020 Finnish wind power industry has the possibility to multiply the turnover by 2020 Wind energy sector in Finland might employ from 12 000 to 30 000 persons before 2020 One of the new opening markets Fare amount of natural limitations Coastline used for time off activities Birds and other sustainability issues New for everybody processes not settled Cost efficient feed-in tariff system
Content Feed-in Tariff Strengths and Weaknesses Investment Barriers and Opportunities TuuliWatti Business Case
TuuliWatti Oy TuuliWatti Oy is an industrial windpower producer jointly owned by S-Voima Oy and St1 Oy, founded in 2009 TuuliWatti Oy s purpose is to produce cost efficient electricity to its owners Business targets: To build 10-20% of Finland s official wind energy production target of ~2500MW by the year 2020 In the long term to own and operate 240-1000MW wind electricity capacity Owns lease agreements to 500 individual turbine sites Develops wind farms Owns and operates wind electricity production First wind turbine (3MW) in Pori Tahkoluoto since 2009 10 windfarm development projects on the West Coast of Finland
Owners and company structure S-Voima Oy Purpose to produce wind electricity as a part of its energy portfolio to its own consumption St1 Oy Purpose to produce wind energy as a part of its energy offering portfolio to its end user customers
S-Voima and the S-Group in brief S-Voima Oy is owned by 22 regional co-operatives and SOK The 22 regional co-operatives and SOK Corporation constitute the S Group (SOK is owned by the co-ops) Mission: Provide services and benefits to members and other customers Key figures: Retail sales 2009: EUR 11,687 million (-1,2 %) Profit before exceptional items: EUR 270 million 1,598 outlets 37,764 employees Electricity consumption 1 100 GWh Strategic goals are to increase the energy efficiency of all operations and to invest in the use of CO 2 free energy
St1-Group in brief St1 was founded in 1995 to operate in oil product wholesale business St1 service station chain (est. 1997) part of the company since 2000 ExxonMobil Finnish Affiliate oy Esso ab was acquired in 2007 the company was named St1 Oy Key figures in 2009 Number of employees 160 Turnover appr. 1.2 billion Euros Market shares Petrol 13.5% Diesel 9.2% Light fuel oil 11.5% Areas of business Petroleum retailing at ~ 640 sites in Finland, Sweden, Norway and Poland CO 2 -aware energy products and services Such as Refuel RE85 High blend ethanol, which cuts transport-related fossil CO 2 emissions by up to 80% Associated companies North European Oil Trade Oy (NEOT Oy)/ S- Group TuuliWatti Oy/ S-Voima Oy St1 Avifuels Oy/ StatoilHydro ASA
TuuliWatti investment plans Development started 2009 : Tervola, Varevaara 20-30 MW Ii, Olhava 18-24 MW Simo, 15-18 MW Pori, Peittoo 28-36 MW Salo/Raasepori, Näsenkartano 30-50 MW Merikarvia, Trolssi 80-105 MW Co-operation TW, HT, EPV Building 2011 (2012) Building 2012 (2013) Development started 2010 : Raahe, Haapajoki 25-30 MW + 25-30 MW Raahe, Piehinki Sarvankangas 80-100 MW Kalajoki, Mustilankangas 80-100 MW Luvia, Martinpalo 50-80 MW Co-operation TW, PE Building 2013
Jari Suominen jari.suominen(at)tuuliwatti.fi Puh. +358 50 5956 780
Back-ups
4.6.2010 klo 05:48 klo 09:06 kwh 70000 60000 50000 40000 30000 20000 10000 0 TW Pori tuotanto 1.6.2010 2.6.2010 3.6.2010 4.6.2010 5.6.2010 6.6.2010 7.6.2010 8.6.2010 3 MW 1.000 kwh 1000 900 800 700 600 500 400 300 200 100 0 TW Pori tuotanto 11/2009 12/2009 1/2010 2/2010 3/2010 4/2010 5/2010 3 MW Suomen tuulivoimatavoite 6 TWh, 2.000+ MW Sähkön hinnan nousu 145% kahdessa tunnissa Lähde: http://www.fingrid.fi/portal/suomeksi/sahkomarkkinat/voimajarjestelman_tila/
Useat päällekkäiset tekijät nostavat sähkön hankintakustannuksia Sähkön hinta, alv0% ( /MWh) Näkymä 2020 100+ /MWh Uusiutuvan energian tukeminen Sähkövero Tilanne 2009 56 /MWh Sähkövero Sähkön siirto Sähkön myynti Päästökauppa Marginaalituotannon muuttuvat kustannukset + 80+ % Sähköenergian markkinahinta Sähkön siirto EU sähkömarkkinaintegraatio Sähkön myynti Päästökauppa Marginaalituotannon muuttuvat kustannukset Oletukset Näkymä 2020 takana: -Sähköverot hallituksen kehysriihen mukaisena v. 2011 taso - Marginaalituotantona hiililauhde, hiili 70+ $/ton - Päästöoikeuden hinta 2020: 40+ /ton,co2 - EU:n sähkömarkkinaintegraatio; lähemmäksi Saksan tukkuhintatasoa - Uusiutuvan energian tukijärjestelmät vaikutus ~1,5 /MWh - Kantaverkkoinvestoinnit ja integraatiokehityksen tarvitsemat yhteydet Eurooppaan, siirtomaksut +4% / vuosi Lähde: Suomen ElFi Oy
Tuulivoima laskee sähkön markkinahintaa -Tuen tarve tuulisähkölle nykyisen syöttötariffin tasolla häviää v.2020 mennessä (takuuhinta 83.5 /MWh vastaa sähkön hintaa) - Pöyryn EWEA:lle tekemässä selvityksessä tuulivoiman Merit Order Effectin on todettu vaikuttavan 3-23 /MWh sähkön hintaan laskevasti - Suomen sähkönkulutus v. 2020 noin 100 TWh -> 1 /MWh = noin 100 milj. Muuttuvat tuotantokustannukset ( /MWh) Tuuli v. 2020 tuulivoima laskee sähkön markkinahintaa Suomessa ~5 /MWh = ~500 milj. Vesivoima (keskivesivuosi) Ydinvoima Systeemihinta Tuonti Venäjä Kysyntä CHP Hiililauhde Tuonti Saksa Öljylauhde Kaasuturbiinit Tuotantokyky (TWh/a) 100 200 300 400 Lähde: Suomen ElFi Oy 17.11.2010 26
Spatial planning Regional land use plan (Regional Council) Local master plan (Municipality) Local detailed plan (Municipality) New law proposal to simplify the process
The permitting process Always required Compliance with flight security (>30 m) Permit in accordance with the Electricity Market Act (> 110kV) Redemption right on the land needed for new electricity transmission lines Building permit Always in the off-shore farms + if the turbines have impacts on water system -> permit in accordance with the Water Act Environmental permit, if project causes inconvenience to neighbors (noise or shimmer) (Invest in Finland + Finnish Environment Institute)