Finland Solar Power Market Outlook to 2029

The Finland solar power market is growing. According to Blackridge Research and Consulting, the Finnish installed solar power capacity is expected to reach 9.04 GW by 2029, up from 1 GW in 2023. This impressive growth is driven by supportive government programs, increasing investments in utility-scale projects, and declining solar installation costs. 

However, factors such as normalizing electricity prices, the nation's focus shift on hydrogen economy development as part of their energy transition plans, and rising interest rates affecting solar project feasibility are restraining market growth.

Driver

Increasing Investment in Utility Scale Projects

Historically, Finland's solar power market has been driven by small-scale residential, commercial, and industrial installations. As of 2023, large-scale solar projects (with capacities exceeding 1 MW) made up less than 5% of the total installed capacity. This limited adoption of large-scale solar was primarily due to the government's previous focus on wind energy, which provides more consistent production throughout the year. 

However, wind power production tends to decrease in June and July, precisely when solar energy generation peaks due to Finland's long summer days.

Recognizing the complementary nature of solar and wind energy, Finnish power companies are increasingly investing in utility-scale solar projects to enhance grid stability and diversify energy sources. Moreover, the significant growth in the wind energy sector has highlighted the need for additional renewable energy sources like solar power.

The newly elected Finnish government, concerned about energy security in light of the Russia-Ukraine conflict, has also started to support large-scale solar projects. They are facilitating this shift by implementing a more streamlined and predictable permitting process, encouraging further investment in utility-scale solar energy.

Restraints

Normalizing Electricity Tariffs

In Finland, many residential and commercial consumers have turned to solar power to reduce or replace their reliance on grid electricity, especially during periods of high electricity prices. The surge in electricity tariffs in 2021 and 2022, largely due to increased fuel prices from the Russia-Ukraine war, significantly boosted the demand for small-scale solar systems.

However, with fuel prices stabilizing, electricity prices returned to normal levels in 2023 and are expected to remain relatively low in the coming years. This normalization of electricity prices is likely to act as a restraint on the solar power market, particularly in the residential sector, as the economic incentive for installing solar systems diminishes when grid electricity is more affordable.

Current Market Scenario

Like the other nations in the Europe solar power market, the government policies play a vital role in the development of the solar industry in Finland.

Solar energy has registered a small but increasing electricity production trend over the last five years in . During 2018–2023, the total solar power generation in the country has increased drastically, primarily due to favorable government policies.

As of 2023, total solar PV installation capacity stood at more than 1 GW. During 2020–2023, the total installed capacity of solar in the country has increased by fourfold. The current solar energy market in the country is dominated by residential, commercial, and industrial projects. For example, in 2023, out of the total installed capacity, the utility sector only accounted for 4.17%.

The major growth in solar installations was recorded during the years 2022 and 2023. In 2022, the Finnish market witnessed a solar capacity addition of 248 MW, while in 2023, the capacity addition was 412 MW. Hence, 2022 and 2023 were record-breaking years for the Finnish solar industry.

The key factors prompting this growth were the introduction of strong government incentives and the exceptional rise in electricity tariffs. In 2022, the average electricity tariffs rose by almost 250% compared to 2021, while 200% growth in average electricity tariffs was registered in 2023. 

Segmentation

By Technology

The Finland solar power market is currently dominated by solar photovoltaics, owing to the drivers mentioned in the former sections. Whereas Finland currently does not have any concentrated solar power (CSP) plants due to lack of high solar radiation, which is a prerequisite for developing a CSP plant.

By Deployment Segment

The Finland solar energy market is dominated by small-scale rooftop solar installations. However, the focus is now shifting to utility-scale projects. 

Recent Market Trends & Developments

• In May 2024, Fotowatio Renewable Ventures (FRV), a subsidiary of Jameel Energy, announced their entry into the Finnish market through a partnership with Finnish renewables developer Will & Must to develop 600 MW of solar projects.
• The European Union's Renewable Energy Financing Mechanism (RENEWFM) has allocated EUR 27.5 million (USD 30.1 million) to support seven solar power projects in Finland.
• In June 2024, Sweden-based solar developer Alight has announced plans to construct a 90 MW solar park in Harjavalta, located in southwest Finland. The solar project will span 105 hectares and is projected to generate enough clean electricity annually to power approximately 17,800 households.

Blackridge Research's Finland solar power market report provides insights into the current Finland market demand scenario and its outlook.

The new report from Blackridge Research on the Finland solar power market provides comprehensive qualitative and quantitative analyses along with a deep insight into the current and future of the market.

(You can access a comprehensive list of both existing and upcoming solar power projects, along with their current status, through our extensive Finland Solar Power Projects Database.)

What Do We Cover in the Report? 

Finland Solar Power Market Drivers & Restraints

The study covers all the major underlying market dynamics that help the market develop and grow, as well as the factors that constrain Finland market growth.

The report includes a meticulous analysis of each factor, explaining the relevant, qualitative information with supporting data.

Each factor's respective impact in the near, medium, and long term will be covered using Harvey balls for visual communication of qualitative information and will function as a guide for you to analyze the degree of impact.

Finland Solar Power Market Analysis

This report discusses the market overview, the latest updates, critical commercial developments and structural trends, and government policies and regulations. 

Finland Solar Power Market Size and Demand Forecast

The report provides the Finland solar energy market size and demand forecast until 2029, including year-on-year (YoY) growth rates and CAGR.

Finland Solar Power Industry Analysis

The report examines the critical elements of the solar industry supply chain, its structure, and the participants.

Using Porter's five forces framework, the report covers an assessment of the industry's state of competition and profitability.

Finland Solar Power Market Segmentation & Forecast

The report dissects the Finland solar power market into various segments based on technology (solar PV and concentrated solar) and by deployment segment (residential and non-residential).

A detailed summary of the current scenario, recent developments, and market outlook will be provided for each market segment.

Further, solar power market share, size, and demand forecasts will be presented, along with various drivers and barriers for individual market segments.

Effective market segmentation enables you to identify emerging trends and opportunities for long-term growth. Contact us for bespoke market segmentation to better align the research report with your requirements.

Key Company Profiles

This report presents detailed profiles of key solar developers in the Finland solar industry, such as Ilmatar Energy Oy, Solarigo Systems, Salo Tech Oyj, etc. In general, each company profile includes an overview of the company, relevant products and services, a financial overview, and recent developments.

Competitive Landscape

The report provides a comprehensive list of notable companies in the market, including mergers and acquisitions (M&As), joint ventures (JVs), partnerships, collaborations, and other business agreements related to solar energy projects.

The study also discusses the strategies adopted by leading solar power companies in Finland.

Executive Summary

The executive summary will be packed with charts, infographics, and forecasts. This chapter summarizes the report's findings crisply and clearly.

The report begins with an executive summary chapter and ends with conclusions and recommendations.