Water power | The Swedish giant arrived in Finland and enraged the protectors of stream waters – Buys “backyard hydropower plants” and puts them to work

Environmental organization Eyebrows were raised at WWF’s office when the first rumors about Swedish company Locus Energy’s activities in Finland began to be heard in the summer.

The company, which is mainly owned by the Nordic financial giant SEB, was looking for, among other things, small hydropower plants at the end of their service life in Finland, which it could modernize to produce green local energy.

The first news came in July. The subsidiary Locus Hydro Oy had bought the Vatajankoski hydropower plant located in Karvianjoki in Kankaanpää. Its use was coming to an end, and permits and government funding were ready to dismantle the dam.

“The deal was a huge disappointment and contrary to the Finnish trend, where dams are dismantled and stream waters are restored”, WWF Finland program manager Sampsa Vilhunen position.

Vatajankoski Oy’s deals with the Swedes left a bitter taste, as the dismantling of the two power plant dams belonging to the company was supposed to start last summer, and in the end only one was dismantled.

Removing stream water barriers from Karvianjoki is part of the Nousu project, which is one of the top projects of the country’s government’s restoration.

Locus Energy opened up its plans more widely at the beginning of September when it announced that it would cooperate with the Finnish consulting company Valor Partners. Valor’s task is to look for potential investment targets for Locus in small plants producing hydropower, wind power and district heating in Finland.

“It seems that the Swedish company has not fully understood that hydropower is viewed more critically in Finland than in Sweden. “, says Vilhunen.

WWF is now trying to influence the companies so that they give up their goals. Vilhunen met the CEO of Locus Energy last week Niklas Sörensen and a meeting with SEB’s representatives has been arranged at the beginning of October.

“Already three governments have done systematic work in favor of rapids environments, so that different types of endangered streams can be revived in Finland,” explains Vilhunen.

of Locus Energy CEO Sörensen opens the company’s goals on the phone in Stockholm.

“In Sweden, Norway and Finland, we invest in plants that are at the end of their useful life and are decommissioned, because returning them to production is more sustainable than building a new one,” says Sörensen.

According to the CEO, the Vatajenkoski power plant’s dam demolition project was known to the company when the deals were made. However, the details of the environmental aspects have been clarified in later discussions.

“According to our understanding, the reasons for dismantling the dam were above all financial and related to giving up production. We continue the dialogue on environmental aspects”, says Sörensen.

Vilhunen considers it possible that Locus’ goals will also arouse the interest of other small hydropower companies.

“Finland has hundreds of backyard hydropower plants and dozens of sites like Karvianjoki. Owners may be tempted to sell the property without realizing that compensation is also available as an alternative.”

Sampsa Vilhunen, WWF’s program director, hopes that Locus Energy will understand that returning decommissioned hydropower plants to production is not a responsible environmental act. Vilhunen photographed in Kaivopuisto in the summer of 2022. Picture: Mika Ranta / HS

Vilhunen is hopeful that the threat can be avoided. Locus Energy, a member of the SEB Nordic Energy fund, uses Nordic fund capital, which is classified in accordance with Article 9 of the EU sustainability regulation SFDR. Investments must therefore strongly promote environmental goals and must not cause significant harm.

“It would be blatantly contradictory for such a fund to invest in sites that contribute to the loss of nature, and the restoration of which already has excellent experiences in Finland,” says Vilhunen.