The Finnish battery industry plans to invest more than six billion euros in the next few years

The turnover of the battery sector is expected to rise rapidly to nine billion euros

The Finnish Ministry of Economic Affairs and Employment of Finland ?published the National Battery Strategy 2025 on January 26th in?order to strengthen the innovative environment of the battery sector, accelerate Finland's sustainable and low-carbon economic growth and support the achievement of climate objectives in transport.

The background for the report is that the national ore reserves and metal processing capacity of Finland are considerable in the European context. Finland produces many battery minerals, in particular nickel and cobalt.

Investments for over 6 billion euros in the coming years

Companies in the battery sector in Finland plan to invest more than six billion euros in Finland in the next few years. By 2027, the target turnover of companies in the sector will be at least around nine billion euros per year. By 2027, the sector will employ 6,000 people directly and indirectly 20,000, the newly formed branch organization Akkuteollisuus ry. - Finnish Battery Industry published in a press release this week.

According to the association, the battery industry is a rapidly growing sector in Finland, and several large-scale battery projects are already underway in different parts of the country.

"The electrification of society and the national battery strategy will accelerate investments in Finland, where the most important minerals for the battery industry can also be found. In addition, Finland has renewable energy and top-class expertise to offer. Among other things, Finland has the world's largest battery chemicals plant [BASF Battery Materials plan in Harjavalta]," the release states.

Pia Vilenius from the Chemical Industry Association has been appointed CEO of the association ?and Matti Hietanen from Finnish Minerals Group has been appointed chairman of the board. Nine companies joined the organisation in the first phase.

According to the association, numerous projects and the modern mining industry required for battery manufacturing will bring Finland a much-needed leap to economic growth and strengthen European industrial autonomy.

"Taking advantage of the opportunities at hand requires streamlining the permit processes for investments, good cost competitiveness, high-quality infrastructure and competence development in cooperation with industry," says Chairman Hietanen.

The members of the new association are Finnish Minerals Group (Suomen Malmijalostus Oy, revenue 378MEUR 2021), Terrafame (revenue 378MEUR), Umicore Finland (revenue 449MEUR), Jervois Finland (revenue 244MEUR), Norilsk Nickel Harjavalta (revenue 1.2bnEUR), Fortum Battery Recycling (revenue 420k€), BASF Battery Materials Finland (revenue 0€, loss 7MEUR), Keliber (revenue 1.8MEUR) and CNGR Finland (revenue 30k€).?Valmet Automotive (revenue 421MEUR) is not part of the association, but is the only company doing battery pack assembly in Finland.

New battery power storage facilities are now being completed at an accelerating pace?

The 15MW industrial-scale electricity storage facility to be built in Ikaalinen [rendered picture at the beginning of article] is an example of these investments.

The flexibility required by the green transition of the electricity network will gain momentum when a Swiss company builds an industrial-scale battery power storage facility for the needs of Lepp?kosken S?hk? in Ikaalinen.

The Swiss-owned MW-Storage Nordic Oy is building a 15-megawatt battery power storage facility in Ikaalinen on a plot adjacent to Lepp?kosken S?hk?'s substation. The investment is more than ten million euros. The battery will be connected to Lepp?kosken S?hk?'s distribution network.

The energy storage facility based on battery technology to be built in Ikaalinen this year is MW-Storage's second industrial-scale electricity storage facility in Finland. The preliminary design phase of the project lasted about 1.5 years. The Lepp?koski and MW-Storage project is one of the largest battery power storage investments in Finland.

Last May, EPV Energy in Vaasa announced that it was building Finland's third largest ?– 12 megawatt – electricity energy storage facility next to the Teuva wind farm. The battery electricity storage facility will now be completed in the early part of the year.

Finland's largest battery is in connection with the nuclear plant at Olkiluoto

Finland's largest and one of the largest battery power storage facilities in Europe were completed last summer, not so surprisingly, in Olkiluoto, Eurajoki. Teollisuuden Voima (TVO), who is also owner of the nuclear plant at Olkiluoto, commissioned a battery energy storage facility of 90 megawatts.

TVO's battery energy storage facility will contribute to supporting the entire Finnish energy system in the event of a production disruption at the Olkiluoto 3 plant unit, reducing the impact of the power change on the national grid.

The battery plant was built by Japanese-Swiss company Hitachi ABB Power Grids, which has delivered more than 600 megawatts of battery energy storage solutions and supporting automation solutions, worldwide.

MW-Storage is one of Hitachi ABB's challengers, especially in Europe.

According to Marco Rüegg, Director of MW-Storage Nordic, the need to balance weather-dependent wind power with electricity storage facilities is greater in Finland than in Switzerland, where there is considerably more highly adjustable hydropower in use than in Finland, the Ikaalinen press release states.

Why suddenly all the investments in battery technology?

The falling cost of battery technologies, better capacities and growth of the electricity adjustment market is driving these investments, because now there is a business model for battery owners, industrial operators and building owners. They are compensated for either not using or feeding back energy into the grid when it is needed, either on a per millisecond, second or minute basis.

The production and consumption of electricity must be in balance at all times. If production and consumption do not match, this will cause a deviation in the 50 Hz frequency of the electricity network.

In the electricity market, if there is a deviation in consumption and production during the hour of operation, the compensation marked or Fingrid's reserves are used to make the correction.

These reserves include power plants, consumption objects, as well as energy users such as paper mills, or shopping malls that are capable of changing their power very quickly, even in a second, if necessary.

The reserve products in use in Finland include fast frequency reserve (FFR) (per second deployment), frequency containment reserves (FCR) (in seconds for use) and frequency recovery reserves (aFFR) (for use in minutes).

"The weather dependence of wind power and other renewable electricity production increases the need for flexibility in the electricity network, and electricity storage facilities are suitable for balancing frequency and voltage fluctuations in the network," says Juha Koskinen, CEO of Lepp?koski Group ?.

According to Koskinen, part of the need to adjust the electricity network is very fast and only part of the capacity, such as electricity storage facilities, is suitable for this control use.

"There is a separate market for regulating capacity, which is called the reserve and balancing power market, depending on the speed of the adjustment. Reserves refer to power plants, consumption sites and energy storages that change their power as needed."

In practice, the investment will allow Lepp?koski to grow its own business in this market. The company has extensive plans for further investments related to electricity storage facilities.

"We are currently investigating the location of an industrial-scale electricity storage facility at the Nokia power plant. The aim of the project development is to investigate the utilisation of the gas turbine located at the power plant and the electricity storage facility connected to it in the balancing electricity and reserve power markets," Koskinen says.

The size of the battery power storage facility planned for Nokia may be as much as double the 15MW investment announced now.

Koskinen says that if implemented, the hybrid battery project would indirectly contribute to the ongoing green transition by introducing short- and long-term adjustable capacity.

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