Dismantling Obligations of Finnish Wind Farms: A Report by Hannes Snellman’s Lawyers for the Ministry of the Environment

Authors: Klaus Metsä-Simola and Minna Juhola

Lately, the rapidly growing wind farm construction has sparked discussion in Finland on the end-of-life obligations related to wind turbines and whether there is an enforceable legal obligation for wind farm operators to dismantle the turbines and their foundations at the end of the lifespan of the wind turbines. As a result of the debate, the new Government Programme of Finland published in June 2023 requires that a comprehensive regulatory obligation to dismantle and restore the wind turbines be introduced. With respect to the new objectives set out in the Government Programme, Hannes Snellman’s lawyers Klaus Metsä-Simola and Minna Juhola have prepared a report to the Ministry of the Environment on the current legal dismantling and waste management obligations related to end-of-life wind turbines in Finland in order for the Ministry to be able to assess the need to amend the applicable legislation currently in force.

This blog post discusses the key findings of Hannes Snellman’s legislative report related to the dismantling of wind turbines in Finland.

Key Findings of the Report

Based on the applicable legislation and the current land lease agreement practice, it can be concluded, as a main rule, that the wind turbines and any above-ground parts related thereto must be dismantled at the end of the wind power operation. However, if the wind turbine foundations are not found to cause environmental pollution or an environmental or safety risk, the current legislative regime does not impose a direct legal obligation to dismantle the wind turbine foundations at the end of the lifespan of the wind turbine. Therefore, the scope of the legal dismantling obligations varies depending on the case-specific circumstances of the wind farm project, and the parties are able to manage the allocation of dismantling obligations by entering into land lease agreements.

As a part of the Hannes Snellman’s report, the regulation and legislative arrangements for wind turbine dismantling in Sweden, Germany, and France were examined. Based on the review, the above-ground components of the wind turbines must, as a main rule, be dismantled in the reviewed jurisdictions after the end of the wind power operations. However, the scope of the dismantling obligations regarding wind turbine foundations varies by country and based on case-by-case circumstances. In the reference countries under review, there is also a general obligation for the operator (or its parent company or the company owning the plant) to lodge a dismantling security with the authorities to cover the remediation costs caused by the termination of the wind power operations. Furthermore, similarly to the Finnish system, the dismantling of wind turbines in Sweden, Germany, and France has normally been agreed upon in private-law land lease agreements between the wind power operator and the landowner. Based on the comparative assessment, the report discusses various options to develop the regulatory environment should the dismantling obligation become more comprehensively regulated in Finland:

• possibility to consider inserting a wind power-specific obligation to dismantle the wind turbine and/or to issue a dismantling security in the current land use and building legislation
• possibility to consider a legislative solution in which the wind farm-specific planning agreements with the municipalities would contain obligations for the wind farm operator to dismantle the turbine at the end of the lifespan of the turbine and issue a dismantling security to the municipality
• possibility to consider adopting wind power-specific regulation regarding wind turbine dismantlement, as is the case in France, for example.

Should the wind turbine dismantling and security obligation become more extensively regulated under Finnish law, we recommend in the report that the impacts of the different regulatory alternatives be estimated carefully in connection with the legislative drafting process, so that the possible amendments do not jeopardise the renewable energy targets set out in the Government Programme.

Current Legislative Regime

In Finland, legal questions related to the dismantling of wind turbines are currently resolved on the basis of public law regulations on construction, environmental protection, and waste management, as there is no wind power-specific legislation concerning the dismantling matters. The applicable Land Use and Building Act (132/1999 hereinafter the “LUB Act”) requires that buildings and their surroundings be kept in a condition that meets the standards of health, safety, and fitness for use at all times and does not cause environmental harm or damage the beauty of the environment. In addition, when a building is no longer used, the building site and its surroundings must be left into a condition that does not compromise safety or degrade the environment. Furthermore, the prohibition of littering regulated under the Waste Act (646/2011) requires that no waste, discarded equipment, or other object be abandoned in the environment in a manner which may cause untidiness, landscape disfigurement, risk of injury to humans or animals, or any other equivalent hazard or harm. Due to the scope of application of the Waste Act, however, the provisions related especially to the dismantling of the foundations of wind turbine generators are open to legal interpretation.

Due to the general nature of public law regulation in Finland, private law-based land lease agreements have been the main tool in managing questions related to wind turbine dismantling. As market practice, the land lease agreements between wind power operators and the landowners usually contain clauses regarding i) wind turbine dismantlement, ii) obligation to restore the area, and iii) requirement of providing a security for the landowner to cover the possible remediation costs in the event of the wind farm operator’s insolvency. As the content of land lease agreements is at the discretion of the parties, land lease agreement models may vary depending on the operator and region in terms of both the extent of the scope of the dismantling obligations and the amount of security to be lodged.

What Are the Next Steps?

The Ministry of the Environment will assess the need and possible means to amend the current regulation, taking into account the considerations set out in the Finnish Government Programme.

To access Hannes Snellman’s full report in Finnish, please visit the Ministry of the Environment’s website here. 

Our Environment and Natural Resources Team is closely following the aforementioned development of the legislative regime and will gladly discuss any related questions. Hannes Snellman advises clients on a regular basis with respect to the permitting, construction, operation, and financing of industrial renewable projects, among other things.