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Juha Sarsama
Ilmatar Energy

18 November 2022

The most noticeable feature of Ilmatar is that it handles renewable energy projects from start to finish: why did you think it was important to manage everything in-house?

Our roots are actually in pure project development and this strategy only came about two years ago. We switched gears and became a full-fledged IPP because we were leaving so much money on the table - this transition is happening quickly, and having the entire value chain under your roof is a huge advantage. Second, we are increasingly interested in hybrid models that combine wind, solar, and storage, possibly even hydrogen, on the same site. When you control the entire value chain, such complexity is easier to manage.

You have 2200 MW of offshore wind planned; what advantages does this segment have over onshore?

It links to the hydrogen economy actually, we share the vision that this sector is going to become reality, not immediately but in 10-15 years. The Finnish government is doing a good job supporting it, and the steel industry in the Nordic countries has committed itself to CO2 free processes. When we made the calculation we concluded that onshore wind will not be enough to support this direction, hence offshore wind must also come into the equation. 

A solar project is also set to begin production in 2023. What prompted this diversification?

To begin with, the production profiles of onshore wind and solar are complementary - if the wind isn't blowing, the sun is most likely shining, and vice versa. Second, even though solar panels have become more expensive, investing in PV still makes good economic sense given current energy prices. Once you have the grid connection sorted out, adding solar next to wind is a very reliable, profitable combination.

Recently you secured a EUR + 135 million private financing. How would you evaluate the ease of accessing capital nowadays, and what are your preferred models?

The financing you mentioned was made at the parent company level, and we can use it very flexibly. As a general rule we have financed ourselves in traditional ways, often through PPAs. We are, however, transitioning away from this model.

We made our first full merchant investment, accepting the risk of price fluctuations, and have also joined Nasdaq Commodities. We strive to be frontrunners when it comes to European financing structures, and we are open to new approaches. Even though there is plenty of money available for this green transition, we want to make the most of it. There is simply too much money left on the table with PPAs.

Is your willingness to take on this risk based on demand projections or a general sense of optimism about the future?

Then, of course, we rely on our people to manage this risk; there is a whole trading desk, comprised of incredibly experienced individuals, who have been establishing guidelines for the level of risk we can accept. This is the most important aspect of carrying out this strategy.

Speaking of risks, supply chains have been raising concerns lately. Has this affected your business in any way?

If you had asked this question last spring I would have said yes, logistics chains were unstable and certain raw materials hard to get a hold of. That seems to be over now, the concern we are left with is that wind turbine producers have not been performing so well and they are pressured to take prices up. It is a constant battle, but a relief to know we can secure all the materials we need for our sites.

Nordic countries are seen as having favourable policies for renewable energy; is that a fair reflection of what is going on in Finland?

It is, indeed. It begins with the fact that our national grid operator is the best in the world, extremely dependable, and supportive of this transition. They provide exact timings for when connection will be possible, so we know what to expect. Of course, we're getting closer to next spring's parliamentary elections, which always causes some tension; energy will undoubtedly be a hot topic during the debates. However, most bodies are already in our sector's favor, both for geopolitical reasons and because we have committed to a CO2-free economy. I don't see any significant opposition to this path.

This winter is expected to be particularly difficult in terms of energy. Do you believe we may need to take a few steps back, towards more traditional forms of energy?

It remains to be seen. Finland is not gas dependent so it is in a different position compared to countries in Central Europe. We discussed the possibility of having to reduce or cut the demand of electricity for a few hours on certain days, but this in no way means that we are distancing ourselves from the clean energy targets. 

What excites you the most about Ilmatar's upcoming decade?


We set out our goals a year ago, deciding to build 1GW of operational assets and another 1GW in the pipeline - we now have 65 people working for us and a pipeline of almost 10GW.


We really can make an impact in Finland and that feels very exciting, especially since I am a big believer in climate change. Being able to leave a mark is truly motivating. I want to see Ilmatar grow and become one of the Nordics' leaders in this industry, with the best people working with us.

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