EnergySampo partners are committed to innovating sustainable energy systems of the future to fight climate change. Increasing wind and solar are important sources of energy today, and their share is forecasted to grow significantly in the future. With increasing wind and solar, come increasing volatility in electricity price and limited predictability, leading to discussions about how to balance the increasing demand and how to secure sufficient power supply during exceptional times.
Sufficient power is the basis of welfare society
These discussions are needed as sufficient power production and availability is the basis of a welfare society. Availability of power, presents different challenges depending on the point of view.
- Consumers are concernd about the price of electricity and the availability of energy can lead to a deterioration in the quality of life. The alternative is an expensive fixed pricing model, and possible power outages due to power shortages (as reported in winter 2022/23 by Yle). Lack of consumer trust can lead in uncertainty, and in the worst case lead to eroding foundations of the welfare society.
- Industrial processes require constant use in order to function effectively. The threat of process downtime can weaken productivity and affect the sustainability of current production in Finland. Furthermore, it can lead to concerns related to the future investments and erode trust of the potential investors. Therefore, a stable, predictable energy market is an important enabler of long-term planning and invest-in activities in Finland.
- Energy industry relies on the growth of wind and solar power as the most cost-effective and fastest way to increase sustainable power production. However, as their availability depends on the weather they increase the volatility of the electricity system. The simultaneous closing of CHP plants as unprofitable, increases the power deficit even more as district heating also moves towards higher degree of electrification and less fossil fuels. However, the power problem can be solved by stabilizing the power supply locally or through a possible power mechanism.
Power problem cannot be solved with Swedish imports
The availability of electricity is a significant competitive factor for the Finnish economy: Consumption flexibility and storage alone are not enough, there must also be production that ensures flexibility and availability of electricity also when the wind does not blow or the sun does not shine. Otherwise, the impact on the national economy can be considerable. Preparation comes with a cost, but it is important: The energy only market is not enough to cover expensive hours, as investments needed are large in comparison with too few running hours/year for the production. In addition to imported electricity, flexible and supply-reliable capacity equivalent to that of a modern nuclear power plant, or other fast reacting production is needed to cover windless and cloudy days and downtimes due to possible technical faults. This “power fire department” should be ready to produce even when there is no fire, i.e. a market or support mechanism would be needed, to guarantee power supply that meets the incresing demand at all times.
“Power-rescue” paving the Finland’s way to lead Europe’s green transition
Finland’s competitive electricity grid attracts international investments: The electricity grids of many European countries are “full”, meaning that new large connection points cannot be connected to them in the near future. Creating a market-based, sustainable solution is important: FINGRID, as a grid company, does not take care of production, so the responsibility must be borne by market players. Cooperation also requires the contribution of political actors: Sustainable and market-based decision-making can promote the creation of the rules of the game for the power mechanism, and investment subsidies can ensure their implementation.
EnergySampo is fighting for Finland
EnergySampo is an innovation ecosystem with focus on sustainable and systemic energy solutions. Together the companies provide e broad base of technologies that are needed for the energy systems of the future. As the future power supply solutions are to be technology agnostic, the EnergySampo partners ABB, Danfoss, Hitachi Energy, Wärtsilä, Vaasan Sähkö, VEO and VNT Management are committed to work together with other industry pleyers and regulators to create systemic energy solutions for the needs of a carbon-neutral society. This blogpost is not aimed to market their solutions, but rather focus attention to this important challenge that needs to be solved to ensure successful green and clean energy transition in Finland and in Europe and globally.
