Fennovoima, a Finnish consortium, announced Monday that it had cancelled a contract with Rosatom, Russia’s state-owned nuclear energy company, to build a Finnish nuclear power plant. This was due to delays and increased risk from the conflict in Ukraine.
The announcement ended months of uncertainty and years of political wrangling about the Hanhikivi 1 plant. This project would have increased Finland’s dependence on Russia for its energy.
Fennovoima stated that it had ended the contract because of RAOS Project’s “significant delay and inability to delivery the project”, referring to Rosatom’s Finnish subsidiary.
The project have been exacerbated by the war in Ukraine.” RAOS was unable to mitigate any risks,” the statement said, but did not go into more detail.
Rosatom stated that it was “extremely disappointed” with the decision, which it claimed was taken without consulting the shareholders of the project, including one of its subsidiaries.
It stated that the project was progressing and had established a good working relationship.
Fennovoima commissioned the plant, a consortium consisting of Finnish stakeholders Outokumpu , Fortum and SSAB own two-thirds. Rosatom’s subsidiary RAOS Voima owns the remainder.
Rosatom was approved by the Finnish government in 2014. However, surveys indicated that Finns were growing anxious about the deal after Russia’s annexation earlier that year.
After Russia’s February invasion of Ukraine – which Moscow called a special military operation – Finland’s minister for economic affairs Mika Lintila repeatedly stated that it was “absolutely impossible” to issue a permit for construction.
Finland shares a border of 1,300 km (810 miles) with Russia. Finland and its neighbour, Sweden are on the brink of applying for NATO membership due to the Ukraine conflict.
Fennovoima management stated that it was too soon to speculate about what might happen next or whether they would look for a partner to finish the power plant.
Esa Harmala (chairman of Fennovoima’s board), stated that she believes there will be a need for nuclear power in the future, but that was only her personal opinion.
Harmala stated that the initial cost of the facility was 7.5 billion euros ($7.89 trillion). She also said that the consortium had spent 600-700 million on it.
Fennovoima stated that its cooperation with RAOS Project would be ended immediately and that it was impossible to predict what would happen to Rosatom’s holding in Fennovoima.