All agreed loans

Finland. Kemijoki Oy

Date of agreement: 9 Jan 2013
Country: Finland
Customer: Kemijoki Oy
Amount in EUR: EUR 20 million
Maturity: 12 years
NACE sector / loan type: Production and distribution of electricity
Business area: Energy and water

Project

The loan has been provided for the refurbishment and upgrading of Kemijoki's hydropower facilities in Finland.  The total capacity of the company's plants will increase without interfering with existing water channel or concrete structures. The programme is expected to increase Kemijoki's hydropower capacity by 25 MW, and output by 14 GWh annually, when completed in 2016.

The increasing efficiency of existing hydropower plants will help reduce reliance on fossil fuel-based electricity production.

Kemijoki Oy is one of Finland's largest producers of hydroelectric power and majority owned by the Finnish state. The company operates twenty hydropower plants with a total capacity of 1,142 MW. Kemijoki is responsible for 30% of national daily regulation and is the most significant supplier of frequency-controlled operation and disturbance reserves in Finland.

Fulfilment of NIB's mandate

Hydropower is the most efficient electricity production technology, due to its low operational costs and its storage function, which allow for quick supply responses to price signals.

The company owns a large share of the regional hydro power capacity and therefore has an important role in maintaining the stability of the regional electricity network. This role may become even more important in the future considering the targeted expansion of wind power production in Finland.

Sustainability summary

The most cost effective way to increase Finland’s hydropower capacity is to increase the efficiency of existing plants through technical improvements. Hydropower is also seen as one of the most sustainable ways of generating electricity. Given that the additional electricity crowds out the electricity generated in a coal fired power plant, the indirect reduction of greenhouse gas emission can be estimated to be approximately 14,000 tonnes of CO2 per year.

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