Power connection proposal could stall southeast Finland data centres

A proposed change to electricity connection rules could delay or cancel data centre projects in south-eastern Finland, city officials have warned, Yle reports. Kouvola and Lappeenranta say the proposal could reduce investment and jobs while favouring western and northern parts of the country.

The Ministry of Economic Affairs and Employment is preparing a change that would give households priority over large data centres and industrial users when new electricity connections are allocated.

Data centres could get connected sooner in areas with abundant electricity generation. Fingrid, Finland’s national grid company, estimates that this could shift data centre development away from southern Finland, where electricity use is currently concentrated. Meanwhile, wind power construction in eastern Finland has been restricted because of the Finnish Defence Forces’ radar surveillance.

“The proposal favours the west and north. It should not be approved in its current form,” said Hannu Tylli, Kouvola’s director of technical services.

Kouvola is currently seeing construction of three data centre complexes, with a fourth planned. In Lappeenranta, forest company UPM Kymmene has begun preparatory work for a data centre, and three other projects are under consideration.

Lappeenranta Mayor Tuomo Sallinen said it could take at least one or two years after a change in the law to see its effects on the city’s economy. He said the impact would become clear over the longer term through the number of new industrial investments. Hydrogen energy projects, as well as data centres, require large amounts of electricity.

Tylli expects the change to delay schedules for new data centre projects.

Both cities said their estimates of the projects’ benefits were cautious and lower than those provided by developers. Kouvola estimates that data centres could provide 500 permanent jobs by 2030 and generate about 1.5 million euros in annual property tax revenue. A completed data centre is estimated to employ about 100 people, while construction of the Pajarila data centre in Lappeenranta is expected to create around 700 jobs.

Sallinen said there was not yet enough experience in Finland to assess the employment effects reliably. He added that Lappeenranta wanted to show its support for data centre projects.