German energy giant wants to build nuclear facility in Finland

Finnish subsidiary looking at 100-hectare property in Loviisa

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Competition is heating up over the construction of a sixth commercial nuclear reactor for Finland.
     E.ON Suomi, the Finnish subsidiary of the German E.ON energy concern, wants to buy a plot of land in Loviisa next to the island of Hästholmen, where Fortum currently has two of Finland's four operating commercial nuclear reactors.
     
The sale of the property of about 100 hectares was given initial approval by the Loviisa City Board on Monday. The sale still needs to be passed by the City Council.
      Matti Manninen, managing director of E.ON Suomi, confirms that if and when the company gets the property, it will begin preparations for the construction of a sixth nuclear reactor.
     The owners of Finland's existing nuclear plants, TVO and Fortum, said recently that they will be conducting environmental studies for a new nuclear facility. TVO says that it could build a fourth reactor in Olkiluoto, in addition to the two units that are already operating there, and the third that is being built. Meanwhile, Fortum would like to build a third at Hästholmen in Loviisa.
     The construction of a nuclear reactor in Finland requires Parliamentary approval.
     
E.ON does not plan to go it alone. Instead, it hopes to gather a strong grouping of Finnish companies and municipalities interested in getting a share of electricity production.
     Manninen does not believe that this will be a difficult task. Many large consumers of electricity, who are not shareholders of TVO, have expressed a desire to become involved in the nuclear project.
     When TVO began to plan Finland's fifth nuclear reactor, which is now under construction, there were more companies and municipalities who wanted in on the project than the utility could accommodate.
     The situation will be similar when TVO begins to prepare an application for a sixth reactor. The present shareholders will certainly use their option to invest, because electricity production is very lucrative at today's prices.
     
TVO's biggest owners are the paper manufacturer UPM, the City of Helsinki, and Fortum.
     Fortum therefore, is a major player in Finnish nuclear energy production. In addition to the Loviisa reactors, it has a 26 per cent holding in TVO,
     E.ON's Manninen believes that larger cities such as Tampere, Turku, Oulu, and Lahti will want to have production of their own, and will therefore be interested in joining the E.ON project. They have also publicly expressed willingness to be involved in electricity production.
     There will also undoubtedly be interest among the grouping of about 20 companies, which set up a company called Elfi to help secure their electricity supply. Elfi's shareholders include some of Finland's largest companies as well as the retail concerns Kesko and SOK.
     
Manninen says that it is important to construct a new nuclear facility near existing reactors. In this way, much of the necessary infrastructure is already nearby.
     The mandatory environmental assessment would also be easier, because such a study has already been made in the area.
     Manninen feels that the involvement of E.ON as a major factor on the Finnish electricity market would be good for competition, and have a beneficial effect on both wholesale and retail prices.


Previously in HS International Edition:
  Electric utilities make preparations for sixth nuclear reactor (29.3.2007)
  Finnish President sees nuclear power as "a short-term medicine" (12.2.2007)
  Construction delays at nuclear plant spark row over compensation (1.2.2007)
  Call for radical electricity market overhaul and sixth nuclear reactor (4.10.2006)

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