25.1.2012 13:30
Press Releases, Projects

New direct current transmission link between Sweden and Finland inaugurated today

Fenno-Skan 2, the high-voltage direct current electricity transmission connection between Finland and Sweden, was inaugurated in Rauma in Finland and Söderfors in Sweden today. The connection was taken into commercial use in the electricity market in late 2011, and its utilisation rate has been very good. The new transmission connection has clearly improved the functioning of the market, as the differences in electricity price between Finland and Sweden have decreased. Fenno-Skan 2 will also consolidate the system security of the transmission grid.
Fenno-Skan 2 is the second high-voltage direct current (HVDC) transmission link between Finland and Sweden. The first one, Fenno-Skan 1, was brought into commercial operation in December 1989. The 800 megawatt and 500 kilovolt connection inaugurated today will increase the electricity transmission capacity between Finland and Sweden by 40 per cent.
The project launched in 2005 was carried out in co-operation between Fingrid Oyj and Svenska Kraftnät, the transmission system operators in Finland and Sweden respectively. The construction of the transmission link cost a total of approx. 315 million euros.
The total length of the HVDC transmission link is approx. 300 kilometres, of which the actual submarine cable accounts for some 200 kilometres. There are converter stations at both ends of the link, used for converting direct current to alternating current and vice versa. The submarine cable will be connected to the Finnish transmission grid at the Rauma substation. In Sweden, the connection point to the Swedish grid is the Finnböle substation built some 150 km north of Stockholm. The converter stations were built by ABB in Sweden, and the submarine cable was supplied by Nexans Norway AS.
Project of many years
The project was started in 2005 to respond to the future needs of the electricity market. Last year in particular showed that the transmission capacity between Finland and Sweden has been insufficient for the needs of the market. Due to extensive variations in the Nordic hydropower generation volume, it has not been possible to transmit as much electricity between the two countries as what the demand has been. As a result, price differences have emerged between Finland and Sweden. In 2011, the prices differed from each other substantially often, in 23 per cent of the time. The price differences decreased from November onwards, when Fenno-Skan 2 was taken into trial operation. The splitting of Sweden into bidding areas has also levelled out the price differences.
Fenno-Skan 2 is one of the most important new Nordic transmission connections. The connection will integrate the Nordic electricity market even more closely together. The link will reduce temporary price differences of electricity between countries, resulting from the segregation of the electricity market, and decrease the hedging costs of the market parties. Intensified competition ultimately benefits the consumer.
The new cable connection will also reduce losses in the Nordic transmission grids and reserve procurement costs, and improve electricity supply security. The increasing electricity import and export options will make it easier to balance the power system as a new nuclear power unit will be connected to the Finnish power system and as the portion of renewable energy production capacity will increase in the coming years.
Concurrent inauguration in Finland and Sweden
The HVDC link was inaugurated concurrently in Finland and Sweden. In Rauma in Finland the inauguration was carried out by Arto Lepistö, Head of Energy Market Division of the Ministry of Employment and the Economy, and Fingrid’s President Jukka Ruusunen, and there was also a video message from Jyri Häkämies, Minister of Economic Affairs. In Sweden in Söderfors, the inauguration ceremony was conducted by Anna-Karin Hatt, Minister for Information Technology and Energy, and Svenska Kraftnät’s General Director Mikael Odenberg.

Further information:
Jukka Ruusunen, President & CEO, tel. +358 (0)40 593 8428
Kari Kuusela, Executive Vice President, tel. +358 (0)40 502 7333