Billion-euro hydrogen plant raises stakes at Finnish government negotiations

US company Plug Power announced a billion-euro investment to develop hydrogen production plants in Finland as energy strategy and climate targets were being questioned by the Finns Party in government negotiations.

At a signing ceremony in Helsinki on Tuesday, a US company Plug Power Inc. revealed plans to build three green hydrogen production plants in Finland. The company press release said that the investment worth around €6 billion is still in the planning stage, and decisions will be made around 2025 or 2026.

According to the company, the investment would enhance European energy security as the produced hydrogen would be exported via pipeline to Western Europe. The scale of electrolyser capacity would account for close to 5% of the RePowerEU plan, which has targeted 10 million tons of renewable hydrogen to be produced in Europe by 2030.

At Tuesday’s ceremony, Plug PowerCEO Andy Marsh partly justified the investment by stating Finland’s commitment to reducing carbon emissions and its carbon neutrality target 2035.

Markku Kivistö, Head of Cleantech Industry at Invest in Finland, also confirmed that Finland was chosen because of its high level of emission-free energy production.

However, these comments disrupted ongoing negotiations to form a new government, particularly as the parties disagree on climate policy.

Climate and energy policy would need a more “pragmatic” approach, Finns Party Chair Riikka Purra said on Monday, calling the 2035 target “stupid” and doubting whether it can even be reached.

Meeting the press on Wednesday, she turned down the concerns that planned new climate and energy policy alignments would block green investments. According to her, investments could be enhanced also outside the green transition.

However, the likely new Prime Minister Petteri Orpo has remained firm that the next government will stick to the carbon neutrality target.

Whether the government will be in any way ready to jeopardise the country’s image as a lucrative investment target remains to be seen, particularly as an estimated 1,000 direct jobs and 3,000 indirect jobs coming from the Plug Power investment are now at stake.

(Pekka Vänttinen | EURACTIV.com)