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1.1 Finland: Case Study 1. Larsmo Vindkraft Ab

Case study report for Finland: Community owned energy project from initiation to completion

Centria University of Applied Sciences 1.1 FINLAND: CASE STUDY 1. • The power plant starts at 3.0 m/s • Achieves maximum power 1000 kW at 11 m/s LARSMO VINDKRAFT AB • Remote control and monitoring from Oulu Larsmo Vindkraft Ab Case study report for Finland: Community owned energy There have been some technical difficulties in the last couple of 1 Introduction project from initiation to completion years and therefore the production has been slightly lower. Centria University of Applied Sciences Larsmo Vindkraft Ab 4 Ownership structure and financial model used Larsmo Vindkraft Oy was founded in 2001 1by Introduction a few private individuals from the Larsmo When the limited company was originally established in 2001, area, which is located near Kokkola in westernLarsmo Finland. Vindkraft OyThe was foundedgoal wasin 2001 toby agather few private founds there for were only a few shareholders and the initial capital was wind measurements and eventually to build aindividuals Wind fromPower the Larsmo plant area, in whichthe is located Larsmo near Kokkolaregion. 15 The 200 €. The focus was to find a suitable location for the power in western Finland. The goal was to gather founds for wind plant, conduct wind measurements and find a power plant sup- idea originally came from a local resident measurements Lars-Erik and Östman, eventually to abuildforest a Wind Power engineer plant in whoplier. isOnly after that, they would start to seek new shareholders the Larsmo region. The idea originally came from a local resi- and investors. interested in sustainability issues and renewabledent energy. Lars-Erik Östman, a forest engineer who is interested in After a suitable location and supplier was found, the entre- sustainability issues and renewable energy. preneurs managed to raise 20% of the needed capital from shareholders and the rest was financed with a 20-year loan 2 Description of community of 540 000 €. The company later received around 65 000 € in investment aids from the Finnish Ministry of the environment. Larsmo is a municipality of Finland, The company eventually consisted of 200 shareholders, most of located in the Ostrobothnia region. The which are private individuals from the Larsmo area. The municipality of Larsmo is also a shareholder in the company. municipality is bilingual with Swedish as the majority language and Finnish as the 5 Implementation Process minority language. The municipality Wind measurements were made around Larsmo, and an area in Fränsviken was chosen due to good wind conditions. After consists of an archipelago of about 360 a suitable location was found, the plants construction permit islands. Larsmo Vindkraft Oy owns one was applied in 2004 from the local municipality. The permit was granted later that year, but was immediately appealed by local wind power plant and consists of around residents. Resistance from local residents was intense through- 200 shareholders most of which are out the whole construction process, and continued after the wind power plant was in operation. private individuals from the region. The Administrative Court in Vaasa handled the appeal, and found the construction permit to be eligible. The opponents then appealed to the Supreme Administrative Court but their case was dismissed. When the building permit was finally 2 Description of community granted, a fundraising campaign was started and eventually the company obtained a total of shareholders 200. 3 Renewable Energy Project Larsmo is a municipality of Finland, located in the Ostroboth- The construction work started in 2005 and in September the nia region. The municipality is bilingual with Swedish as the road and land construction work was finished. Local entrepre- The project consists of one privately owned windmajority power language plant and Finnish located as the minority in Larsmo: language. The neurs did all the harvesting and roadwork. All the construc- municipality consists of an archipelago of about 360 islands. tion and installation work regarding the power plant was the Larsmo Vindkraft Oy owns one wind power plant and consists of responsibility of Winwind Oy. The power plant construction around 200 shareholders most of which are private individuals work was finished in June of 2006 and after some testing and  Wind turbine: 1MW from the region. adjustments, the supply of electricity to Jakobstad Energiverk  Supplier: Winwind Oy began a few days before midsummer in 2006. 3 Renewable Energy Project When the plant had been running for some months, residents  Hub height 65m near the plant complained about the noise. Larsmo Vindkraft  Rotor diameter 60m The project consists of one privately owned wind power then had to carry out noise measurements in addition to the plant located in Larsmo: environmental permit. A company named Pöyry Oy conducted  Estimated production 2.2 million kWh, which corresponds to the consumption in the110 noise measurements, and the levels were found to be below • Wind turbine: 1MW the limit values. electric heated houses • Supplier: Winwind Oy The power plant has now been running for over 12 years, and  The power plant starts at 3.0 m/s • Hub height 65m has mostly needed only regular maintenance work. However, in • Rotor diameter 60m recent years since 2016, the plant has had some technical issues  Achieves maximum power 1000 kW at• 11 Estimated m/s production 2.2 million kWh, which corresponds to and therefore the energy sales has been slightly less than in the  Remote control and monitoring from Ouluthe consumption in 110 electric heated houses previous years.

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There have been some technical difficulties in the last couple of years and therefore the 6 Project results:production Lessons has been learnt slightly & lower. post- project benefits The proceeds 4from the Ownership sale of energy structure have mainly and gone financial to loan model used repayments. The company has not reviewed any tariff subsidies for energy salesWhen because the the limited minimum company total power was require originally- established in 2001, there were only a few ments are notshareholders met. Due to the and low the price initial of electricity capital in was recent 15 200 €. The focus was to find a suitable location for years, the plantthe has power not been plant, as economically conduct wind profitable measurements as and find a power plant supplier. Only after that, expected. In 2011, the company paid out a small dividend to the stakeholders, theyin addition would to startthis, stakeholdersto seek new have shareholders not finan- and investors. cially benefited from the project. After a suitable location and supplier was found, the entrepreneurs managed to raise 20% of Things entrepreneurs would do differently now: the needed capital from shareholders and the rest was financed with a 20-year loan of • More info events540 000 for local€. The residents, company this could later reduce received around 65 000 € in investment aids from the Finnish resistance Ministry of the environment. The company eventually consisted of 200 shareholders, most of • Choose a morewhich secure are supplier private individuals from the Larsmo area. The municipality of Larsmo is also a • Raise a larger share of own equity, 30-40% • Do not assumeshareholder that the price in the of electricity company. will rise • It would be good if the company could use some of the electricity themselves5 Implementation or find customers Process from the region • You should use a third-party consulting company, who acts as a technicalWind advisor measurements were made around Larsmo, and an area in Fränsviken was chosen due to

Contact: Einargood Nystedt, wind Centria conditions. University After of Applied a suitable Sciences location was found, the plants construction permit was [email protected] in 2004 from the local municipality. The permit was granted later that year, but was immediately appealed by local residents. Resistance from local residents was intense throughout the whole construction process, and continued after the wind power plant was in operation.

The Administrative Court in Vaasa handled the appeal, and found the construction permit to be eligible. The opponents then appealed to the Supreme Administrative Court but their case