Energy Update: New legislative project to clarify requirements and processess for offshore wind power in the exclusive economic zone
Interest in the development of offshore wind power projects in Finland has increased significantly in recent times. As project developers are exploring the opportunities to construct wind farms in the exclusive economic zone ("EEZ") of Finland, many find themselves wondering how the permitting process will be arranged and how the final project developer with the exclusivity over an area will be selected. As a part of the programme of the current Finnish Government, a new legislative project aiming to clarify the above-mentioned matters has been announced in October 2023. Our Energy practice's Associates Toni Kastell and Nelli Rönkkö have summarised below the most important facts you should know about the new legislative project.
Activities in the EEZ are currently regulated by a framework act not drafted for offshore wind power
The EEZ is an area beyond and adjacent to the territorial waters of a state, extending up to 200 nautical miles. Even if the zone is not located within its territory, the state has jurisdiction over the natural resources found in the EEZ in accordance with the international law. In Finland, activities in the EEZ are regulated by the Act on the Exclusive Economic Zone of Finland (26.11.2004/1058, in Finnish: laki Suomen talousvyöhykkeestä) ("EEZ Act"), which is currently applied when developing offshore wind power projects in the EEZ.
According to the EEZ Act, certain Finnish laws apply in the EEZ. These include legislation related to, for example, environmental impact assessment, environmental protection, the organisation of water and marine resources management, water permits and maritime spatial planning. However, the Finnish real estate system and land use planning, for example, do not apply in the EEZ as within the territory of Finland.
As the EEZ Act is a framework act, it has not been drafted from the perspective of offshore wind power. Due to the limited applicability of the Finnish legislation in the EEZ, the current permitting requirements differ to certain extent from the ones applicable to onshore and offshore projects within the territory of Finland. So far, no offshore projects have been fully permitted and developed in the EEZ. Therefore, there are uncertainties about, for example, the permitting processes and how the final project developer with the exclusivity over an area will be selected.
The new act will be partly applied instead of the framework act
The Finnish Government has a clear goal of promoting offshore wind power in Finland and it aims to, for example, ensure "a predictable and encouraging operating environment, along with smooth project development and construction both in the exclusive economic zone and in territorial waters". According to Prime Minister Petteri Orpo's Government's Programme, the current rules for offshore wind power are inadequate and the EEZ Act suits poorly the purposes of offshore wind power projects. For this reason, a new legislative project was announced in October 2023 with the aim of drafting a new act for offshore wind power in the EEZ.
The legislative project has several goals:
- It aims to establish rules for the procedure and criteria for the selection of the final developer with the exclusivity over a specific sea area, and to clarify the permitting process and general legislation for offshore wind power projects in the EEZ.
- The project aims to co-ordinate these new changes with the rules for wind power projects in the territorial waters and on land.
- The goal is to enable state revenue from offshore wind power projects and to increase state control over placing of projects.
Once the new act enters into force, it will be applied to offshore wind power projects in the EEZ alongside and partly instead of the current EEZ Act.
Government proposal estimated to be submitted to the parliament in autumn 2024
The preparation of the legislative project started in autumn 2023 and the consultation round is expected to start in May–June 2024. The intention is to submit the legislative proposal to the Finnish Parliament in autumn 2024.
Our Energy practice will follow the progress of the project and publish relevant newsflashes as the project progresses. Should any questions arise, do not hesitate to be in touch with the contact lawyers listed on this page. We are happy to discuss and give further insight into the matter!