Minister Hautala criticises Fortum for insufficient investment in electric grid

Häkämies wants better compensation for customers

Heidi Hautala

Jyri Häkämies

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Minister of International Development Heidi Hautala (Green), who is also the minister responsible for state corporate ownership, says that Finnish electric utilities have not invested enough in Finland’s electric grid, or in replacing overhead electric lines with underground cables, out of the way of falling trees.
      Her criticism comes after storms recently caused extensive damage to power lines, cutting off electricity to thousands of households for what was seen as an unacceptably long time.
      Hautala said that the state-owned power company Fortum has has made greater efforts to bury electric cables in Sweden than in Finland, where it has spent EUR 100 million in a year on the process.
     
“One could ask if the companies have made too easy money and avoided these [investments]. The companies could sharply increase their investments”, Hautala said, adding that state involvement might be needed, because the matter has security implications.
      Minister of Economic Affairs Jyri Häkämies (Nat. Coalition Party) plans to have his ministry draw up an assessment on how much it would cost to bury critical parts of the electricity grid. He also said that electric utilities probably would like the state to take part in the project, but he would not make any promises about money.
      The state can oblige electric utilities to make improvements, for instance, by setting deadlines by which time a certain proportion of the grid cables need to be placed underground.
     
Fortum spokeswoman Anne Brunila denies that Sonera has neglected upgrading the Finnish grid, noting that in one year the company has installed 550 kilometres of cable underground in Sweden, while in Finland it places 1,000 kilometres of new network cable underground a year.
      Brunila says that the annual investment of EUR 100 million includes all electricity grid and maintenance investments. When extending the grid, underground cables are the primary option, but not the only one.
      “That alone will not eliminate electricity cuts. We cannot build underground cables on our own – permission from the land owners is needed for that”, Brunila says.
     
Brunila also pointed out that if power lines were placed alongside roads, it would be much easier to locate and fix faults.
      She also said that the areas in forests cleared for power lines could be expanded, but that Finland’s 400,000 forest owners would need to be consulted on the matter.
      Highway legislation is no impediment to putting power lines along roads. However, Harri Pursiainen, chief of staff at the Ministry of Transport, says that the present law should be amended to clarify how large areas should be bought from land owners for road construction.
     
Economic Affairs minister Häkämies also said on Tuesday that he would look into whether or not the liability of electric utilities for electric faults should be expanded.
      Such a move would work as an incentive that might encourage utilities to place cables underground, and to repair possible malfunctions more speedily.
     
From 2004 electric utilities have been required to pay compensation to customers for blackouts lasting more than 12 hours. The compensation for a 12-hour blackout is in the form of a lower electricity bill.
      For blackouts lasting five days, the entire distribution network fee part of an electricity fee is waived for a year. The maximum compensation is EUR 700, but the distribution fee is usually just a few hundred euros.
      Juha Naukkarinen, managing director of Finnish Energy Industries says that higher compensation ultimately is paid by the customers – including those who rarely have problems with their electricity service.
     


Previously in HS International Edition:
  Calls for better preparation for storms by electric utilities (3.1.2012)
  Storms leave thousands without electricity (2.1.2012)

See also:
  Espoo to upgrade capacity to deal with storm damage (4.1.2012)

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