Finland. Pahkakosken Energia Oy
| Date of agreement: | 14 Dec 2023 |
|---|---|
| Country: | Finland |
| Customer: | Pahkakosken Energia Oy |
| Amount in EUR: | EUR 50 million |
| Maturity: | 15 years |
| NACE sector / loan type: | Production and distribution of electricity |
This loan contributes to climate change mitigation: 100%
Financing from NIB Environmental Bond proceeds
NEB-eligible share: 100%
NEB category: Renewable energy
Amount disbursed: EUR 18.4 million
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 the construction of a 186 MW onshore wind farm in Northern Ostrobothnia, Finland.
The Pahkakoski wind farm will consist of 30 turbines delivered by Vestas Wind Systems A/S. The wind farm will not benefit from any public support scheme. The electricity production will be partly covered by a power purchase agreement with a commercial off-taker and will also have exposure to the wholesale power market.
Grid connection works are complete, and the substation has been energised and connected to the grid. Wind farm development permits are in place and the project completion is expected by August 2025.
This is the first loan agreement signed by NIB under the InvestEU programme. The transaction is eligible under the NIB’s Clean Energy Transition Framework Operation approved by the InvestEU Investment Committee in May.
Pahkakosken Energia Oy is a special purpose company owned by Ilmatar Energy Oy, a Nordic renewable energy company headquartered in Finland and majority-owned by investment funds managed by French asset manager Omnes Capital.
Fulfilment of NIB's mandate
Productivity
The wind farm will contribute to Finland´s wind power capacity.
The current overall wind power capacity in Finland is increasing at a rate of around 1,000 MW annually. In 2022, wind penetration increased by five percentage points compared to the previous year. This development is expected to reduce power prices and attract energy-intensive industries to the region.
Environment
Wind power is one of the most sustainable ways to produce electricity, and this project will result in the avoidance of CO2 emissions that would arise due to the accumulation of more carbon intensive ways of generating electricity.
Expected impact from the project:
- Capex: EUR 230 million
- Production capacity: 186 MW
- Annual production (90% probability): 516 GWh
Sustainability summary
Impacts on noise levels, flickering, biodiversity – especially birds and bats, and reindeer herding, along with other parameters were assessed. It has been concluded that the project has no high-risk environmental impacts, and the Saami people’s interests have been considered.
Sustainability proofing in accordance with the InvestEU Fund requirements were carried out. A sustainability proofing summary is available here.
