Finland. Kemijoki Oy
| Date of agreement: | 03 Nov 2023 |
|---|---|
| Country: | Finland |
| Customer: | Kemijoki Oy |
| Amount in EUR: | EUR 50 million |
| Maturity: | 14 years |
This loan contributes to climate change mitigation: 100%
Financing from NIB Environmental Bond proceeds
NEB-eligible share: 100%
NEB category: Renewable energy generation
Amount disbursed: EUR 50 million
This project has been financed with the proceeds of NEBs issued under the previous framework
Note: For loans in other currencies than EUR, the equivalent in EUR is based on the exchange rate effective for the disbursement. Read more about the NIB Environmental Bonds
Project
The loan has been provided for Kemijoki Oy’s investment programme over 2023-2027.
The investment programme aims to update and maintain the company’s hydropower assets, and involves new innovations, such as the short-term energy storage HYCAP (HydroPower Capacity) and a new solution for ensuring fish migration in hydropower sites.
Kemijoki Oy owns and manages 16 hydroelectric power plants in Kemijoki watershed. These plants’ average annual production of 4.3 TWh amount to nearly 30% of hydropower production in Finland.
The investment program comprises of eight subprojects:
1) Upgrades in the four hydropower production plants Ossauskoski 1, Valajaskoski 1, Vajukoski and Kurittukoski.
2) Basic upgrades of machinery auxiliary systems in Petäjäkoski 2-3 and Porttipahdan.
3) Upgrades of the electrical systems.
4) Upgrades in the dam structures.
5) Upgrades in dam safety.
6) Upgrades in the dam bridges.
7) Fish management obligations.
8) Migratory fish solutions related fish projects.
Fulfilment of NIB's mandate
Productivity:
The investments secure the supply of critical power system services and public goods.
The investments will improve the regulation ability of renewable hydroelectricity by balancing the fluctuation between production and demand. This will support the stability of the electricity grid even in exceptional situations.
The rapid increase in intermittent power production highlights the systemic importance of the Kemijoki Oy’s hydropower plants. The investments of the projects will support frictionless operation and further development of the stabilising features of the plants. For instance, the pilot investment in the HYCAP (Hydro Capacity) system in Kurkiaska power plant combines hydropower production and short-term battery storage, and consequently, adds capacity of short-term balancing power and reduces the plants response time to balancing demand from few seconds to milliseconds.
Environment:
Hydropower is in general a sustainable way of generating renewable electricity. The primary objective of the investments is to extend the lifetime of the hydropower assets. Hence, the production is expected to remain unchanged and there are no quantitative impacts related to the investments.
The investment programme is fully eligible for NIB Environmental Bonds.
Sustainability summary
Kemijoki Oy’s HYCAP development project aims to improve short-term electricity storage. This will help the powerplants to respond to very short-term changes in electricity demand and production. The storage capacity was taken in to use at the Kurkiaska power plant in spring 2023.
The upgrades and renovations of electrical systems will ensure reliable and safe electricity transmission. Seven plants will undergo electrical system renovations, and 119 dams will receive safety checks and refurbishments. Also dam bridges will be upgraded based on inspections.
Kemijoki Oy is actively working to strengthen migratory fish stocks and biodiversity with ongoing projects. In their biodiversity program, they are focusing on creating migration solutions for migratory fish from Bay of Bothnia to Ounasjoki and implementing habitat renovations in stream waters. Kemijoki Oy has also an ongoing fishpond monitoring project, with the purpose of strengthening the design and implementation of fishponds.
The company prioritises proper chemical and waste management, ensuring minimal environmental impact and adherence to local guidelines.
