Finland rejects undersea electricity cable from Russia

Jan 31, 2007 HELSINGIN SANOMAT, INTERNATIONAL EDITION

Finland's Minister of Trade and Industry, Mauri Pekkarinen announced on Tuesday that Finland would not allow the construction of an undersea electric cable from Russia to Finland.

The decision was finalised in the government's ministerial committee on economic policy.

The Russian-led United Power sought permission to export electricity to Finland through a cable with a capacity for 1,000 megawatts. The cable was to have run from Kernovo at the southeast end of the Gulf of Finland, near the Russian Sosnovyi Bor nuclear power plant, to Kotka in the southwest of Finland.

United Power submitted its application to the Ministry of Trade and industry over two years ago. Pekkarinen said that perhaps the most important reason for rejecting the application was the effect that it would have had on Finnish self-sufficiency in electricity production. According to Pekkarinen, Parliament has emphasised this autumn that Finland must be more self-sufficient than before in the production of electricity. "If it were implemented, the cable project would have especially reduced domestic co-generation of electricity and district heat, and would have significantly slowed down the implementation of new domestic energy solutions. All of this would mean the reduction in production of electricity using domestic sources from the present level of 34 per cent. This would not be a good development", Pekkarinen explained in a press release of the Ministry of Trade and Industry.

Pekkarinen added that the undersea cable project would have required EUR 1.5 billion in investments in strengthening the carrying capacity of the Finnish electricity grid. The ministry also considered the likely availability of electricity in northwest Russia, and concluded that the applicant had not demonstrated convincingly that an uninterrupted flow of power could be guaranteed in all circumstances.

Leaders of Finland's political parties were largely in agreement with the decision to reject the cable project. Social Democratic Party Chairman, Minister of Finance Eero Heinäluoma , felt that the decision was the only option for securing Finnish energy supplies. He said that the sea cable would not have been a sufficiently reliable source of electricity during cold periods. Heinäluoma pointed out that Russia also has a growing need for energy, and that therefore, increasing dependence on Russia for energy would be risky for Finland. He also noted that existing Russian exports of electricity to Finland broke down on a couple of occasions for technical reasons last year. He echoed Pekkarinen's view that Finland needs to produce more electricity itself, using renewable sources.

Leaders of opposition parties were also largely in agreement with the government's decision. Only Matti Korhonen of the Left Alliance would have wanted to allow the cable, saying that it would bring more competition to the energy market and help lower prices. However, Korhonen welcomed the fact that the decision would probably promote domestic energy production. National Coalition Party leader Jyrki Katainen said that in this case, more important than an increase in competition and lower prices is that Finland prepares to produce more energy on its own that is "climatically sustainable", and to develop new technology for the purpose.

The National Coalition Party is the only political group that openly supports the construction of a sixth nuclear generator. Katainen has also called for more input into the use of biological energy sources. Green League chairwoman Tarja Cronberg said that the decision was "very good". Like the other leaders, Cronberg said that she hopes that the decision would lead to investments into renewable domestic forms of energy. She added that it is very good that Finland does not buy Russian electricity that is produced by nuclear power. She also said that it is important not to make Finland more dependent on Russia for energy.

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