Going nuclear: How Finland is building energy independence from Russia

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Finland’s first new nuclear power plant in more than 40 years started test production over the weekend, the next step in the tiny Nordic country’s continuing push for energy independence – a strategy that has taken on increasing importance as the European Union grapples with its energy relationship with Russia.

The war in Ukraine has flipped Europe’s energy conversation on its head. A continent heavily reliant on fossil fuels from Russia, the public and political tide here is turning away from long-standing oil and natural gas import policies.

In Finland, the new nuclear plant – though fraught with delays – is one of the many steps toward diversification the country has taken to fortify its energy supplies, ever cautious of the Russian neighbour with which it shares a 1,340-kilometre-long border. It has also reignited a debate about nuclear power on the continent, and just how much of a share the fuel should hold in the bloc’s energy mix.

EU member states buy scads of gas from Moscow to keep their heat and lights on, with imports from Russia making up about 45 per cent of the bloc’s gas imports. But those purchases are no longer palatable because they are, in effect, helping the Kremlin finance its aggression against Ukraine.

Finland also gets some of its gas and electricity from Russia, says Petri Peltonen, Finland’s Under-Secretary of State at the Ministry of Economic Affairs and Employment.

But the country is looking to scale both of those back. On the power generation side, that goal will soon be helped along by Olkiluoto 3, the first nuclear plant to open in Europe in more than a decade.

Olkiluoto 3 sits on a small west coast peninsula that juts out into the frigid Gulf of Bothnia, about 270 kilometres northwest of the capital, Helsinki. Privately owned and operated, the plant will produce about 14 per cent of the country’s power supply when fully operational come the summer, or about 1,600 megawatts of electric capacity (MWe).

“In that sense, we are in a position where the imported electricity from Russia would not be an issue in the future after the summer, if it was to be somehow challenged,” Mr. Peltonen told The Globe and Mail.

With Europe grappling with how to rapidly rejig its energy supplies, Finland is quietly forging ahead with a mix of biofuels and nuclear power, with heat a particular focus in this frigid northern country, where the ground at this time of year remains blanketed by a thick layer of snow and the temperature hovers around freezing.

Riku Huttunen is the Director-General for Energy at Finland’s Ministry of Economic Affairs and Employment. Energy diversification wasn’t exactly penned onto the country’s books as a specific policy, he said in an interview. Rather, it evolved from a long-standing Finnish mindset to always ensure the country has options.

“That may be the best description of our thinking,” he said. “If you have 1,300 km of border with Russia, you always want to have options.”

Evidence of Finland’s commitment to preparing for the unknown lies in the central government body created solely for that purpose. The National Emergency Supply Agency oversees preparedness co-operation between the private and public sectors, and arrangements that maintain national emergency stockpiles for essentials such as food, medicine and critical raw materials for industry.

Energy is one of the highest priorities for the agency, which has squirrelled away five months’ worth of fuel stocks.

When Moscow uses its energy resources for its own political targets, it’s “important for Finland to be prepared for the situations when we’ll not be able to import fuels and electricity power from Russia,” the agency’s director of its energy department, Pia Oesch, told The Globe.

Mr. Huttunen chuckles when asked if Finland’s energy diversification could be a model for Europe. “We are modest, we would never say that,” he said. Still, he thinks other countries probably envy Finland’s fuel stocks and the fact it has diversified its heating sources and power grid to such a degree.

Though it took decades to build, the Olkiluoto 3 nuclear plant plays a critical role in that diversification. Although Finland is relatively accepting of nuclear power compared with its neighbours, another new plant planned for the north of the country is on ice as the government considers the facility’s application.

The Hanhikivi 1 reactor was to be constructed in Pyhajoki. When a German company originally vying for the project left, Mr. Huttunen said, Rusatom Energy International, a subsidiary of the Russian state nuclear energy corporation, jumped on board – and the war in Ukraine has made that “an extremely topical issue.”

The Finnish government isn’t postponing a decision on the project’s permits, but “you might guess what are the feelings today” about Russian involvement in a nuclear plant within Finland’s borders, he added.

Whether nuclear becomes a more palatable option in the EU as the bloc tries to ease its reliance on Russian oil and gas imports remains to be seen.

European credit ratings agency Scope Group released a research note about it last week, noting that Europe is “at a curious juncture” with nuclear. Reinvestment in the fuel would help reduce greenhouse gas emissions and improve security of the power supply, but it’s not a quick, easy answer to Europe’s energy woes.

France has committed to reinvestment in nuclear power and the Dutch government decided last year to drop plans for a scheduled nuclear exit by 2033, Scope said. But Germany remains committed to a nuclear exit.

“The result is that the region needs to find alternatives to the projected net 12 GW loss in nuclear capacity by 2030 – equivalent to building significantly more than 40 GW of wind [and] solar capacity – to keep electricity output stable,” it noted.

But the devastating 1986 Chernobyl nuclear disaster looms large in the collective European memory, said Nikolai Sitter, a professor in energy and public policy at Central European University and BI Norwegian Business School.

So, Dr. Sitter doesn’t believe that Finland’s bet on new nuclear plants will reverberate across Europe – it’s simply too politically risky. Germany, in particular, has snubbed its nose at nuclear, pledging in 2011 to shut down all of its nuclear power stations by 2022.

However, Dr. Sitter acknowledges there’s a chance the public there would prefer to extend the life of their nuclear power plants than to keep sending millions of euros each day to Moscow to help finance its aggression against Ukraine.

Back in Finland, as much as the country is fairly well-prepared to weather any energy storms on the horizon, Mr. Huttunen warns that prices will remain high as Russian energy is phased out. And that will have “significant downsides for consumers,” economic growth and inflation.

“That is the price of reducing dependency,” he said.

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