Act No. 1396/2010 on the Production Subsidy for Electricity Produced from Renewable Energy Sources

The Finland’s feed-in premium scheme for renewable electricity production (wind power, biogas, forest chips and wood fuels) entered into force in 2011 (Act No. 1396/2010). The scheme was amended several times since its adoption, and more recently by Act No. 441/2018.

 

The production support scheme consists of two different premiums:

1. A sliding premium tariff for new investments in wind power, power from biogas (landfill gas excluded) and power from small CHP power plants using wood fuel (hereinafter “the wood fuel plant”). The tariff is dependent on the market price of electricity, i.e. the difference between the target price in the legislation and the spot price of electricity. Heat premium is paid on top of the basic tariff for biogas and wood fuel plants that produce also heat with certain efficiency.

 

1. A sliding premium tariff for electricity produced from wood chips. This tariff is dependent on the EU emissions allowance price and tax rate on peat. The tariff compensates on the difference of running costs of using peat and wood chips in power and heat production. As the tariff doesn’t compensate capital costs of the power plant the tariff is paid also to existing power plants. Also this support scheme contains elements that encourage the efficient production of electricity and heat in CHP units.

Support for wind power was closed at the end of 2017.

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