Elenia’s Network Development Plan 2024: Record High Green Capex Requirements

Elenia delivered the Network Development Plan (NDP) 2024 to the Energy Authority (EA) at the end of June 2024. The plan includes long term capex estimates for security of electricity supply and green transition investments as well as strategic choices and changes in the operating environment. NDPs are submitted biennially and the most significant change in Elenia’s current plan is the needed capex for green transition. The NDP 2022 presented total capex of approximately 2 billion euros for 2022–2036, and this consisted mostly of investments to security of electricity supply, health safety and environment (HSE) and new connections. Only moderate quantity of green capex was included in the previous plan and it consisted of near future wind and solar power connections and smart meters. In the NDP 2024, the total capex for 2024–2036 is approximately 2.4 billion euros, despite the forecast period being two years shorter. Security of electricity supply, HSE and new connections related investments are broadly in line with the NDP 2022, but the green capex has increased substantially being more than 500 million euros between 2024 and 2036.

The green capex estimate is based on scenario work that studied the future changes in Elenia’s operating environment including new production and consumption. Out of all Finnish Distribution System Operators’ (DSOs) NDPs Elenia had by far the largest share of green capex.

The 2.4 billion euros represent the actual capex need for 2024–2036 but due to significant negative changes in the regulatory methods that came into force on 1 January 2024, the capex plan for the current year had to be cut by approximately 40 million to preserve Elenia’s credit ratios and support the rating. The planned capex levels will remain at the same level in the coming years, even though the need would be higher than ever.

The changes in the regulatory methods for regulatory periods of 2024–2027 and 2028–2031 strongly conflict with the green transition goals and the network capacity investments. Therefore, Elenia alongside with other Finnish DSOs appealed to the Market Court and the process is still ongoing.

Public consultation: three hours is the maximum tolerable outage length for 60% of respondents

The EA requires that DSOs must arrange a public consultation of their NDPs. During May Elenia received 1888 responses from customers and other stakeholders to the consultation survey, doubling the number of responses from the 2022 public consultation.

In the survey, societal expectations for security of electricity supply were evident, with 93% of respondents stating that the longest acceptable outage time should be 12 hours or less, and 60% thinking that the acceptable outage time should be at most three hours. The results highlight that customers and the society do not tolerate the maximum 36-hour outages which are the limit for 2036 in the Electricity Market Act’s quality requirements. It is in the interest of customers and society that Elenia should speed up the rollout of the weatherproof electricity network but unfortunately the negative changes in the regulatory methods for 2024–2027 and 2028–2031 are strongly in contradiction with this.