Finland’s renewable energy transition has two distinct foundations. The older one is the forest industry, whose residues and by-products have supplied heat, electricity and industrial energy for decades. The newer one is a rapid expansion of wind generation that has changed the country’s electricity market within a relatively short period.
These resources now operate within a wider low-carbon system that also includes hydropower, nuclear generation, heat pumps, electric boilers and growing solar capacity. In 2024, renewable sources produced 57% of Finland’s electricity, while renewables accounted for 43% of total energy consumption. When nuclear generation was included, fossil-free sources supplied 95% of domestic electricity production.
The next phase is therefore not simply about replacing fossil power plants. Finland must expand its grid, move electricity from wind-producing regions to major demand centres and create enough flexible industrial consumption to use a growing supply of weather-dependent power.
Wind Has Become Finland’s Leading Renewable Electricity Source
Finland’s wind sector has moved from a supported emerging industry to a major source of market-based electricity. In 2024, wind farms generated 19.9 TWh, an increase of 37% from the previous year. Wind supplied approximately one-quarter of domestic electricity production and overtook hydropower to become the country’s second-largest generating source after nuclear power.
Most development has occurred onshore, particularly in western and northern Finland. These areas offer suitable wind conditions, available land and access to regions where new grid infrastructure can be developed. The growth of larger turbines has also improved project economics, allowing more electricity to be generated from each site.
A significant share of Finnish onshore wind development can now proceed without the operating subsidies once needed to establish the sector. Commercial demand, long-term electricity contracts and expectations of future industrial electrification have helped support investment.
Wind output is variable, however, and Finland’s cold climate makes periods of low generation especially important. Electricity demand can rise sharply during calm winter weather when heating requirements are high. Hydropower, nuclear generation, imports, energy storage and demand response therefore remain essential parts of system reliability.
Wind power can also produce the opposite problem. During periods of strong output and limited consumption, Finland may have more electricity than its market can immediately absorb. Very low or negative prices create opportunities for flexible consumers, but they can reduce revenues for generators and weaken the commercial case for new projects unless electricity demand grows with supply.
Finland’s Renewable Energy Economy Still Begins in the Forest
Wind now leads renewable electricity production, but bioenergy remains central to Finland’s broader energy system. The country’s extensive forest sector produces black liquor, bark, sawdust, wood chips and other residues that can be used in industrial boilers, combined heat and power plants and district heating networks.
Black liquor, a by-product of chemical pulp production, has historically been Finland’s largest individual renewable energy source. Burning it allows pulp mills to recover chemicals used in production while producing steam and electricity for their own operations. Other wood-based fuels are used across municipal heating systems and industrial sites.
This relationship explains why Finland reached a high renewable share before the recent wind boom. Renewable energy was already embedded in the operating model of one of the country’s most important industries.
Bioenergy nevertheless occupies a more complicated position than wind or solar power. Its climate impact depends on the type of material burned, the rate at which forests regrow and the effect of harvesting on national carbon sinks. Forest-industry residues can replace fossil fuels and make use of materials created by existing production, but greater demand for energy wood can place additional pressure on forest resources.
Finland must therefore balance energy production, industrial competitiveness and carbon removal. Bioenergy is likely to remain important, especially for high-temperature industrial heat and winter energy demand, but future growth will face closer examination than it did during the earlier stages of the renewable transition.
The Clean-Heat Transition Is Moving Beyond Combustion
Heating is one of the defining features of Finland’s energy system. Long winters create high demand in homes, public buildings and commercial properties, while many urban areas depend on district heating networks.
Coal once played an important role in these networks, particularly in Helsinki and other large cities. That period has largely ended. Finland’s remaining major coal-fired heat and power facilities closed during 2025, several years before the legal deadline for ending the energy use of coal.
Their replacement illustrates how Finland’s renewable transition is broadening. Energy companies are investing in industrial-scale heat pumps, electric boilers, thermal storage, waste-heat recovery and renewable fuels. Data centres, industrial processes, wastewater and seawater can all provide heat that would otherwise remain unused.
Electric boilers can produce district heat when wind generation is abundant and wholesale electricity prices are low. Heat pumps can multiply the useful heat obtained from each unit of electricity. Large hot-water stores can separate the timing of electricity consumption from the timing of heat delivery.
This creates a direct connection between renewable power and urban heating. Wind farms no longer serve only traditional electricity demand; they can increasingly replace fuels used in boilers. The same process can reduce emissions while giving the power system a flexible customer capable of increasing consumption during periods of surplus generation.
Wood fuels will continue to support district heating, particularly where electrification is less economical. Even so, the direction is clear: Finnish heating is moving from coal and peat towards a combination of electricity, recovered heat, storage and renewable fuels.
Grid Expansion Will Decide How Much Wind Finland Can Use
Finland’s best wind resources and many of its largest projects are located away from the country’s main southern consumption centres. This creates a transmission challenge. Additional generation has limited value if the grid cannot move electricity to cities, industrial plants, heating networks and export connections.
Fingrid is responding with one of the largest investment programmes in the history of the Finnish transmission system. Its current programme anticipates approximately €5.2 billion of grid investment over ten years. New north–south lines, substations and cross-border connections are intended to support renewable generation and as much as 10 GW of additional industrial electricity demand.
The growth of renewable supply is occurring alongside the electrification of heating, transport and manufacturing. Proposed data centres, battery factories, hydrogen facilities and synthetic-fuel plants could create large new demand centres. Their location will affect the cost and speed of grid development.
Connection queues and regional congestion are therefore becoming central renewable-energy issues. Finland must coordinate the construction of generation, transmission and electricity-consuming industry rather than treating them as separate sectors.
The grid must also manage faster changes in production. Wind and solar output can rise or fall over short periods, while the closure of combustion plants removes generators that previously supplied balancing services. Batteries, flexible hydropower, interconnectors and consumers that can adjust operations according to system conditions will become more valuable.
Solar, Offshore Wind and Hydrogen Form the Next Investment Frontier
Solar power remains much smaller than wind generation in Finland, but it is growing quickly. Production increased by 61% in 2024 and reached 1.2 TWh. Long summer days support strong seasonal output, although limited winter sunlight means solar cannot directly meet the country’s highest cold-weather demand.
Residential rooftop systems are being joined by larger commercial projects. Solar output during summer can complement wind generation and reduce daytime electricity purchases, while batteries can improve the value of small-scale production.
Offshore wind offers much greater potential volume. Developers have proposed projects in the Gulf of Bothnia, Finland’s exclusive economic zone and waters associated with Åland. Offshore sites could support very large turbines and substantial electricity production, but construction in icy northern waters raises costs. Finnish offshore projects must also compete with cheaper onshore wind developments.
The size of the development pipeline should consequently not be confused with the capacity likely to be built. Offshore wind will depend on permitting, seabed rights, grid connections, investment support and credible future demand.
Green hydrogen is one possible source of that demand. Finland’s first commercial green-hydrogen facility began production at Harjavalta in 2025 with 20 MW of electrolyser capacity. Larger projects have been proposed for industrial clusters and ports, where renewable electricity could be converted into hydrogen, ammonia or synthetic fuels.
These industries could absorb wind power during periods of high production and create export-oriented products. Their progress will depend on electricity prices, European regulation, infrastructure and customers willing to pay for low-emission materials and fuels.
Finland Is Building a Renewable Industrial System
Finland’s renewable transition is moving beyond the replacement of individual fossil-fuel plants. Wind power is becoming a central electricity source, bioenergy remains integrated with the forest industry and electrified heating is creating new uses for clean power.
The country’s 2030 renewable-energy target calls for renewables to reach 62% of gross final energy consumption. Meeting that ambition will require continued wind and solar development, but generating capacity alone will not be enough.
Grid construction, flexible consumption and new industrial investment must advance at the same pace. Finland’s strongest opportunity is to turn abundant low-carbon electricity into heat, hydrogen, fuels and industrial products. Its principal risk is that renewable supply grows faster than the infrastructure and demand required to use it profitably.
