The Offshore Wind Power Act to Enter into Force on 1 January 2025

During this year, the Real Assets Team at Hannes Snellman has been closely monitoring the legislative initiative on offshore wind power in the Finnish exclusive economic zone (“EEZ”), aiming to enhance market competitiveness and transparency of legislation. On 19 December 2024, the Act on Offshore Wind Power in the EEZ (the “Offshore Wind Power Act”) was finally ratified by the President of the Republic of Finland. The new Offshore Wind Power Act, where exclusivity to wind power production in the EEZ will be granted through a three-step process, will enter into force on 1 January 2025.

In our previous blog post, we have further described the three-step process and the contents of the new Offshore Wind Power Act. In this blog, Katja Heikkinen, Elisa Panula, and Jenny Karlsson highlight certain amendments made to the Offshore Wind Power Act during the handling of the Parliament and the steps going forward.

Final Amendments to the Offshore Wind Power Act

The final amendments to the Offshore Wind Power Act have been implemented, which further emphasise the goal to ensure and accelerate investments in offshore wind in the EEZ. The most significant changes concern the right of the runner-up to apply for the exploitation permit and restrictions on the number of tenders that can be won, as described in more detail below.

In the tendering process, the Energy Authority will not only determine the winner but also a runner-up, who must meet the same criteria as the winner, such as qualitative factors and the minimum price level. If the winner does not apply for the exploitation permit within the given time frame, the runner-up will have the opportunity to apply for it under the same terms. Further regulation on determining the winner and the runner-up will be outlined in the Government decree. Allowing the runner-up to apply for the permit will enable the project development to commence more quickly compared to the restarting the tendering process from the scratch. Extending the opportunity for the exploitation permit to the runner-up means that the participation fee, promotion guarantee, and criteria for applying the permit will also apply to the runner-up.

Additionally, the restriction that allowed a bidder to win only one area when multiple areas are tendered simultaneously, has been removed. However, a new limitation on the number of areas that can be won has been introduced. If multiple areas in the EEZ are tendered simultaneously, an entity, enterprise, or a consortium can win

• one tender if the entity, enterprise, or its affiliated group company (alone or through a consortium) has two exploitation permits for offshore wind areas in the EEZ where a wind farm has not yet been taken into planned use

• a maximum of two tenders if the entity, enterprise, or its affiliated group company (alone or through a consortium) has one exploitation permit for offshore wind areas in the EEZ where a wind farm has not been taken into planned use.

As the aim is to tender the areas promptly, it is important that each participant has equal opportunities to participate in the tendering of all areas without jeopardising the likelihood of a specific project being executed. Consequently, the requirement to specify the order of priority of areas applies only when a bidder is participating in more tenders than it is allowed to win according to the above-mentioned limitations. Additionally, the previous provision of having to place only one participation fee has been removed as it is now possible to win more than one tender.

Next Steps for Offshore Wind in the EEZ

As previously mentioned, preparations for selecting the first area(s) in the EEZ will commence next year, including the necessary strategic environmental assessment, SEA. The goal is for the Government to decide on the first area(s) to be tendered during the autumn 2025. The preparation of the Government decree, which will set out further details on the tendering process and the selection criteria, will continue in the upcoming spring and will be enacted before the first tender process commences. According to the envisaged timetable, the first round of competitive tendering could commence as early as at the end of 2025.

Hannes Snellman advises clients on a regular basis with respect to, inter alia, the permitting, construction, operation, and financing of energy projects, as well as public procurement questions that relate to energy projects, including onshore and offshore wind. Our experts are closely following the development of the offshore energy sector and the related legislative regimes both in territorial and EEZ water areas. Please contact us should you wish to discuss any related questions.