FinSolar Project Lead, M Sc. (tech.) Karoliina AuvinenEnergyWeek 2015, Renewable Efficient Energy -seminarUniversity of Vaasa, 17.3.2015

Solar energy in Finland: feasibility & policy perspectives

FinSolar project aims to boost solar

energy market growth in Finland

• Domestic market is important for new business

model, technology and expertise development

• We identify investment challenges and propose

solutions related to financing and regulation

• Investor groups: municipalities, commercial sector

and house co-operatives & export group

• Main funder Tekes

• Duration 9/2014-12/2015

Municipalities:HelsinkiHSYJyväskyläMikkeliSodankyläTampereTuusulaVantaa

Companies:

Caverion

Cencorp

FCG

Helsingin Energia

IKANO Retail Centres

Finland Oy

Kaukomarkkinat

Mäntsälän Sähkö

SaloSolar Oy

Savosolar Oy

S-ryhmä

Sundial Finland

Ruukki

Associations, schools and co-operatives:Aalto-yliopistokiinteistötOy

As Oy Auringonsäde, HelsinkiAs Oy KuopionPuistokatu4, Kuopio

As. Oy Liinasaarenkuja3-5, EspooAurinkoteknillinenyhdistys ry

EkoenergyinternationalKeski-SuomenOpiskelija-asuntosäätiö

KouvolanseudunammattiopistonBiosampoLappeenrannanteknillinenyliopisto

MetropoliaAmmattikorkeakouluSuomenLähienergialiittory

SYKE,KohtiHiilineutraaliakuntaa(HINKU) -hanke

WWF Suomi

Ahjo EnergiaAura EnergiaAurinkoa OyAurinkoinsinöörit OyBaseNCorporationCO2.FI OyCurrentfinOyECCA NordicFinnfundFinnwindOyGreen Energy FinlandGreenesOyGreenstreamNetwork OyGrexelOyJoukonVoimaOyMotivaNaps Solar Systems OyNocartOySEAM GroupSolar-Arena.com Solarvoima OySoleco OySoleras OySolved – The CleantechCompanySun EnergiaOyTelogOyUtuapuOy

Partners:

Solar PV system prices in Finland follow declining German cost trend

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PV system prices

in Finland 2014

Solar collector prices in decline –installed capacity growing

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Source: http://www.iea.org/publications/freepublications/publication/FeaturedInsight_HeatingWithoutGlobalWarming_FINAL.pdf

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Investment casesfrom Finland

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Vuores-house, educational center, Tampere 2014

• 45 kW PV power plant

• ROI 6,7%

• Payback period 14,5 years

• Product lifetime 30 years

• Electricity production cost 6 c/kWh during 25 years

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Karoliina Auvinen

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Commercial building, Pori 2014

• PV power plant

49,5 kW and heat

pump system 60

kW

• ROI 9%

• Payback period 11 years

• Product lifetime 30 years

• Electricity production cost 6 c/kWh during 25 years

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Karoliina Auvinen

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Solar collectorsprofitable in oilheated houses

Four solar collectors produce approx. 4000 kWh/year - in a

house with oil heating it means savings of 450 oil liters and 500

euros every year

House co-operative Erämaantie, Kangasala 2014

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• Solar collectors 27,6

kWth and heat pump

system 90 kW

• ROI 11%

• Payback period 10-12 years

• Product lifetime 30 years

• Heat production cost 3,8 c/kWh during 25 years

Hybrid central heating system by Suomen Ekoenergia, Lahti, Finland 2013 (240 m2)

Ruukki Roof Integrated

Collector

Ilkka Arha 5.3.2015 Vantaa

Ruukki Classic® solar roof integrated collector

Architecturally integrated collectors

Value chain of solar heat investment, equipment imported

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Kuvat: Petri Konttinen

Investment

5.150 €

Domestic rate

45%

Savosolar Confidential

Large area collector field installation at Sakarinmäki school, Helsinki

District heating solutions

Investment total

180.000 €

Domestic proportion of value chain,

equipment from Finland

57%

Comparison of ROI profits

• Solar energy investments in

profitable locations 6 - 11%

• Criteria:- access to investment aid

- solar replaces oil, gas or retail electricity

- no production to the grid

Compare profits:

• Saving account interest rates

0,1 - 1,65% (Jan 2015)

• Real estate investments 4,4%

average profit (2013)

• Heat pump investments >10%

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e/k

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] (V

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Investment cost of solar PV system eur/Wp (VAT 0%)

9% ROI

7% ROI

5% ROI

3% ROI

Price of electricity in

investigated

investment cases in 2014

by FinSolar project

Return on investment (ROI) between 1 - 9% in solar PV investments in 2014 –

good profit for building owners with investment aid

Price of PV

system eur/Wp

without

investment aid

Price of PV

system eur/Wp

with 30%

investment aid

Comparison of solar electricity production vs. electricity purchase prices

• Solar electricity production

cost 7,4 c/kWh (with VAT

24%) during 25 years

Vs:

• Electricity retail price for

companies and cities 9

c/kWh and houses 14 c/kWh

during 2011-2014

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Comparison of solar heat production vs. other heating prices

• Solar heat production cost

46 €/MWh (with VAT 24%)

Vs:

• District heating 70-80 €/MWh 2012-2014

(exemption summer tarif regions)

• Electricity heating for houses 108-117

€/MWh 2012-2014

• Heating oil (with VAT 24 %) 104,4 €/MWh

• Pellet (with VAT 24 %) 61 €/MWh

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Conlusion: Solar energy is already feasible, but market growth would improve with support policies

Comparison of PV support policies between Finland, UK, Belgium and South Korea

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Support policy

small scale

Support policy large

scale

Installed

capacity

MW

Market

growth

Finland Exemption from

grid fees and

taxes

Investment aid,

exemption from grid

fees and taxes up to

100 kVA or 800 MWh

Approx. 6

(2014)

slow

UK Feed-in Tariffs Renewables

Obligation

4979 (2014) fast

Belgium Net-metering Capital subsidies,

income tax credits

3008 (2013) fast

South

Korea

Home Subsidy

Program

Renewable Portfolio

Standard

1555 (2013) average

Marstal SDHP in Denmark

Eight largest solar district heating plants (SDHP) of Europe are in Denmark and Sweden– when in Finland?

Source: http://www.solar-district-heating.eu

Policy recommendations

• Higher electricity and heat oil taxes

• energy investment aid program for people suffering

from energy poverty to compensate possible negative

social impacts

• Leasing or PPA financing instrument with state

guaranty for municipalities’ cleantech investments

• Extension of house renovation tax deduction from

installation work to energy saving or renewable

energy equipment

=> Benefits: more jobs, more state income, better trade

balance and improved exporting conditions

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Thank you! Any questions?

Contact information:Karoliina Auvinen, karoliina.auvinen@aalto.fi, +358 50 462 4727Aalto University, Helsinki FinSolar Project http://laica.fi/finsolar-in-english/

References / Lähteitä• Gaia Consulting. 2014. Saatavissa:

https://www.tem.fi/files/41148/Sahkon_pientuotannon_kilpailukyky_-_loppuraportti_-

_final_%28ID_15372%29.pdf

• Kallio Atte ja Rasinkoski Asko. 2014. Säätövoimaa Suvilahden aurinkovoimalasta [blogi].

Saatavissa: http://blogi.helen.fi/suvilahden-aurinkovoimalasta-saatovoimaa/

• Tahkokorpi Markku. 12/2014. Case Vuores-talo. Saatavissa: http://laica.fi/2015/01/16/case-

vuores-talo/

• Tahkokorpi Markku. 12/2014. Case KOy Aurinkopaja yrityskiinteistön

aurinkosähköinvestointi. Saatavissa: http://laica.fi/2014/12/30/case-koy-aurinkopaja-

yrityskiinteiston-aurinkosahkoinvestointi/

• Kauppalehti. Talletuskorot [verkkojulkaisu]. Säästötilit [viitattu: 23.1.2015]. Saatavissa:

http://www.kauppalehti.fi/5/i/porssi/korot/index.jsp?selected=talletuskorot

• Kaleva Hanna. 2014. The Finnish Property Market 2014. KTI Kiinteistötieto Oy. Saatavissa:

http://www.kti.fi/kti/doc/fpm/KTI_FPM14_net.pdf

• Sulpu ry. 2014. Lämpöpumppujen merkitys ja tulevaisuus. Saatavissa:

http://www.sulpu.fi/documents/184029/209175/Lampopumppujen-merkitys-ja-tulevaisuus-

SULPU.pdf

• Tilasto: Energian hinnat [verkkojulkaisu]. ISSN=1799-7984. 3. Vuosineljännes 2014. Helsinki:

Tilastokeskus [viitattu: 23.1.2015]. Saatavissa:

http://www.stat.fi/til/ehi/2014/03/ehi_2014_03_2014-12-17_tie_001_fi.html

• Korea Energy Management Corporation, Annual report IEA-PVPS-2013-Korea

17.3.2015

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Extra material

Solar energy cost levels start to be competitive with fossil fuels

20.1.2015

FinSolar

Electricity spot prices in summer

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Hour Spot price c/kWh

Day 22.6.2014 23.6.2014 24.6.2014

00 - 01 2,71 2,54 2,96

01 - 02 2,27 2,31 2,90

02 - 03 1,99 2,07 2,83

03 - 04 1,76 1,99 2,80

04 - 05 1,59 2,02 2,79

05 - 06 1,46 2,39 2,90

06 - 07 1,36 3,04 3,58

07 - 08 1,42 3,25 4,49

08 - 09 1,87 3,60 4,80

09 - 10 2,18 3,43 5,09

10 - 11 2,48 3,40 5,19

11 - 12 2,47 3,59 5,54

12 - 13 2,43 3,65 4,79

13 - 14 2,45 3,49 4,52

14 - 15 2,35 3,51 4,20

15 - 16 2,33 3,79 3,99

16 - 17 2,30 3,52 3,87

17 - 18 2,48 3,66 4,08

18 - 19 2,32 3,59 4,20

19 - 20 2,58 3,33 4,22

20 - 21 2,72 3,34 3,77

21 - 22 2,77 3,30 3,65

22 - 23 2,85 3,25 3,64

23 - 00 2,81 3,14 3,39

0

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c/k

Wh

hu

hti

-syys

ku

uss

a

20.1.2015

FinSolar

7M€ sähköyhtiön

hallinnoimaa 3,3%

‘joukkorahoitusta’http://www.energie-graz.at/kundenservice/kundenservice/de_strom_solar-anleger