A tsunami of investments
During recent years, the green transition has paved the way for major green industrial investments throughout the world. One of the regions that is exceptionally well positioned for investments of this kind is the west coast of Finland.
According to a real-time database administered by the Confederation of Finnish Industries EK, green transition projects worth over €270 billion were planned in Finland in early 2025. Out of these, a lion’s share is planned along the coast. The projects cover everything from offshore wind power to battery production and energy storage.
“Finland stands out internationally in terms of the size of the combined projects, especially in relation to the size of the population and the economy. This is quite natural, since Finland has extraordinarily good prerequisites for net zero projects thanks to a high share of carbon-free electricity”, says Teppo Säkkinen, Senior Adviser, Climate, Energy and Industry Policy at the Finland Chamber of Commerce.
The west coast of Finland stands out both nationally and internationally regarding planned green investments. What makes the region so special? According to Emilia Kullas, Director at the Finnish Business and Policy Forum (EVA), geography is one explanation.
“The green investments are dominated by wind power, and more specifically by offshore wind power. The lion’s share of Finnish wind power is already situated along the west coast, and most of the new investments are also planned here”, Kullas says.
A sparsely populated country like Finland obviously has better prerequisites for wind power compared to densely populated areas like Central Europe. Finland’s electricity mix is already 95 percent carbon-free and wind power is the second largest energy source on track to becoming the largest one. Furthermore, solar power projects and energy storage solutions are booming.
There are also other factors that work in Finland’s favour when it comes to windpower.
“When compared to Sweden, for example, Finland has a more reliable national grid and a unified electricity price across the country. And unlike Sweden, Finnish municipalities benefit from wind power through our taxation model, which strongly motivates municipalities to pave the way for wind projects”, Kullas says.
Finland’s cold climate and island-like geographical position have traditionally made energy independence a central issue in the country. Despite the geography, Finland has never been particularly dependent on Russian energy, which may come as a surprise to foreigners.
With a high share of carbon-free electricity, Finland is an ideal location for net zero projects
In addition to wind power and other energy-related issues, there are also other factors explaining Western Finland’s favourable position for green investments. First of all, the coast is home to a number of ports with excellent connections to the outside world, which logistically attracts industrial establishments. Secondly, the west coast is one of the most industrialised areas in Finland as many industries have historically been established as far away from the Russian border as possible. For example, the west coast is home to the largest energy technology concentration in the Nordics (in Vaasa), and to the largest concentration of inorganic chemistry industries (in Kokkola).
“The presence of existing industries naturally supports the establishments of new industries. It is easier to establish a new industry in an area where there is an efficient cooperation network consisting of sub-suppliers and raw material providers”, explains Teppo Säkkinen.
A good example of this is the planned GigaVaasa battery area, situated in Vaasa, the Nordic capital of energy technology. Hailing from the area, Finland’s minister of European Affairs and Ownership Steering, Joakim Strand, is a strong advocate for his hometown.
“Here on the west coast we live and breathe exports and industry. This area is immensely important to the whole country while also offering foreign investors splendid opportunities for industrial establishments. Our region has long been a forerunner in energy technology and inorganic chemistry, making this a natural place for all types of energy related investments, including world class R&D.”
Although a lot of projects are planned, the outlook for many projects became more uncertain during 2024. However, the big picture has not changed significantly according to Paula Erkkilä, CEO of the Ostrobothnia Chamber of Commerce.
“Some projects have been postponed or delayed, but few have been canceled altogether. The financing of the projects has become more challenging due to higher interest rates and unstable markets, but the big picture has not really changed. The timeframe has just been extended and now stretches into the early 2030s”, Erkkilä says. She is convinced that a great share of the projects will still materialise.
“One thing is for sure: our region on the west coast stands out in the big picture. We have never experienced an investment wave like this before. Even if only part of the planned projects materialise, it would still be significant.”
All the conditions are in place, but what is now lacking is the spark to set the snowball rolling. At the moment, there is a kind of chicken-and-egg situation; Industrial investments like battery and aluminium production are waiting for investments in renewable energy like solar power, hydrogen production, and offshore wind power.
“There are many investments in green energy that could move forward immediately if there was only certainty of the demand for the energy on the customer side”, Säkkinen says.
Green transition projects worth over €270 billion were planned in Finland in early 2025
One reason that investments are moving slower in Finland and the rest of Europe is the IRA subsidies (Inflation Reduction Act) issued by the Biden administration in 2022, which aim to promote clean energy and technology investments. Due to the subsidies, it has been more favourable for companies to make investments in the US.
“The stance of the Trump administration on the IRA is still open. Right after the inauguration, payment of IRA funds was put on hiatus. On the other hand, several Republicans in Congress have been supportive of at least parts of the IRA, as it has driven investment in their constituencies. The most likely scenario is that the IRA will continue in some form with an altered scope”, says Säkkinen.
As a small economy dependent on foreign trade and foreign capital, Finland has been reluctant to compete through state subsidies, but in 2025, tax reductions were finally introduced in order to attract investments.
“Our principle is not to compete with subsidies but with favourable conditions. However, well-targeted incentives can help and the Finnish government has now decided to offer tax credits for net-zero investments. Hopefully this will speed up some of the projects” says Säkkinen.
Despite the general waiting mode for many net-zero projects, there are still many projects already underway.
“Wärtsilä is expanding its sustainable technology hub in Vaasa, Hitachi is building a new technology campus in Vaasa, and Hycamite has inaugurated its hydrogen factory in Kokkola, just to mention a few. This is proof that we are on the right track”, concludes Paula Erkkilä.
Why Finland is ideal for green investments
Ambitious targets
Finland has the most ambitious sustainability targets in the world – the country plans to be carbon neutral in 2035.
Clean energy
The electricity produced in Finland is already very clean. In 2023, 92% of the electricity consumption was fossil free.
Wind power
Finland has a lot of land and few inhabitants – there is great potential for more wind power, both onshore and offshore.
District heating
Thanks to broad use of district heating, there are excellent possibilities to utilise waste heat from industrial processes.
Stability
Finland is a stable country with a predictable investment environment. Finland is also a member state of NATO.
Education
There is a skilled workforce in Finland and an education system that has been widely recognised internationally.
EU single market
Finland is a full member of the European union, offering foreign investors access to the single market.
Sources: State Treasury, Republic of Finland
