In 2024, Fingrid identified suitable connection sites for large offshore wind power projects and named seven potential connection points in the existing and planned transmission grid along the coast.
The transmission grid has been extended, by political decision, to offshore areas in countries where onshore wind power can no longer be significantly expanded in practice due to space constraints – for example in the Netherlands.
Although Finland still has plenty of room to increase onshore wind and solar power, the need to extend the transmission grid to the sea has recently been discussed here as well. This would have a favorable impact on the economic viability of individual offshore wind power projects, as the connection line to be implemented as an offshore cable and any offshore and onshore substations are significant cost factors.
Based on the actual costs incurred by Denmark, Germany and the Netherlands, which are building offshore wind power, it is possible to estimate what extending the transmission grid to the sea would cost in Finland.
The cost of the offshore grid for one large 1.3 GW offshore wind farm would be estimated at 1 billion euros, or even significantly more if the distance from the coast were greater and more expensive direct current technology had to be used. (*
This is a significant amount compared, for example, to Fingrid’s the current €5.2 billion investment plan for the transmission grid, which extends to 2035. It enables the connection of up to 50 GW of new electricity generation, consumption and electricity storage to Finland’s power system and significantly strengthens electricity transmission capacity between production and consumption centres.
Alternatively, with the same money, connection lines could be built for only about 5 GW of offshore wind power.
Electricity market legislation in Finland, as in many other countries, is structured in such a way that the transmission grid connects national electricity production and consumption centres, and each customer is responsible for the connection line it uses to connect to the transmission grid.
The essential difference is that, unlike connection lines, the transmission grid is not built to meet the needs of individual customers.
Building an offshore transmission grid would, in practice, be a subsidy targeted at one generation technology, as the costs of the transmission grid are charged to all grid users; both electricity consumers and other electricity producers.
Fingrid’s goal is a clean, secure and Europe’s most competitive power system. This requires that we can continue focusing on our core mission under the Electricity Market Act, namely to develop Finland’s electricity transmission backbone grid while striving to maintain the country as a unified bidding area for electricity trading.
Expanding Fingrid’s investment plan to include offshore grids would not promote Finland’s competitiveness, as the costs would ultimately be borne by all other grid users – including households.
Laura Ihamäki
Customer Manager
Fingrid Oyj
*) The cost estimate includes the submarine cable connection line as well as offshore and onshore substations. The length of the AC connection’s submarine cable is 30–70 km, and that of the DC connection is over 70 km.
References:
ENTSO-E: Offshore Network Development Plans Methodology
Olle Johansson & Albin Andersson: Offshore Wind Transmission Systems – Power Grid Integration Techno-economic analysis of HVAC, HVDC, and LFAC
