17 Sep 2020
EUR 24.77 million
Financial institutions and SMEs
The final stretches of a new 53 km motorway between Koskenkylä and Kotka in southeast Finland were taken into use on 1 September, 2014, one month ahead of schedule. The motorway is the result of a public-private-partnership that got underway less than three years ago and includes all necessary maintenance work until the end of 2026.
The life-cycle model is an agreement between the Finnish Transport Agency and special purpose vehicle Tieyhtiö Valtatie 7 Ltd. The cost of the project is 340 million euros, and the value of the service contract value is approximately 623 million.
Jaakko Kouvalainen, Chief Executive Officer of Tieyhtiö Valtatie 7, is satisfied with the construction phase, and says the project would have lasted significantly longer if it had been financed through traditional budget funding.
“Since the public-private-partnership model has been developed holistically together with the contractor, the funding has not put any restraints on the progress of the project,” says Kouvalainen.
“The threat of permanently missing out on revenues from the Finnish Transport Agency if we fall behind has also forced us to stay ahead of schedule,” he adds.
The consortium headed by Kouvalainen consists of Meridiam Infrastructure, pension insurer Keskinäinen eläkevakuutusyhtiö Ilmarinen, and construction firms Destia Oy and YIT Rakennus Oy.
NIB is participating in the financing of the E18 Koskenkylä-Kotka motorway with a 14-year-maturity loan of EUR 91 million signed with the consortium.
Converting the E18 Koskenkylä-Kotka stretch into a four-lane motorway has significantly shortened the drive and is expected to increase traffic safety while enhancing connections between urban centres along Finland’s southern coast. Future plans include projects to develop services such as housing, tourism and logistics.
The 53-kilometre motorway construction project consists of 68 bridges and underpass corridors, the 470 metre Markkinamäki tunnel and the Ahvenkoski bridges, each approximately 260 meters long.
Project Director Jukka Hietaniemi from the Finnish Transport Agency estimates that the motorway can help cut cases of personal injuries by around 110 (including 30 fatal ones) during the next ten years.
“In addition, congestion will disappear almost completely and the travel time between Koskenkylä and Kotka will be about eight minutes shorter,” Hietaniemi says.
A greener motorway
The motorway project has been guided by a “Green Motorway” concept, the aim of which is to utilise the stretch as an innovation test platform for sustainable development technology.
Traffic safety will be improved by telematics that will make it possible to monitor traffic, weather conditions, electronically change speed limits, and update drivers via information boards along the road. The telematics will also assist in adjusting the lighting along the road to better suit changing conditions. This again has the potential of making the illumination more energy-efficient.