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European Commission - Press release

State aid: Commission authorises support for Metsä Fibre bio-product pulp mill in Finland

Brussels, 10 March 2016

The Commission has concluded that Finnish investment aid for the Metsä Fibre bio-product pulp mill in Äänekoski, Finland is compatible with EU state aid rules.

The mill will manufacture softwood pulp for the paper industry, and also use by-products, largely left over from the pulping process, to generate and sell renewable electricity.

Finland plans to grant €32.1 million to the mill to partially cover an investment in state-of-the-art renewable energy and energy efficiency measures at the Äänekoski mill. The total investment costs of the mill are €1.2 billion. The project also benefits from a loan by the European Investment Bank (EIB) of up to €275 million, of which €75 million is guaranteed by the European Fund for Strategic Investments and was approved in June 2015.

The combined measures will allow the mill to operate without burning the heavy fuel oil usually used by pulp mills and to use less energy per unit of output compared to similar plants. The plant will be fully self-sufficient in terms of energy, and also feed renewable electricity into the Finnish grid. Furthermore, the project is expected to create 6000 jobs during the construction phase and sustain another estimated 2500 jobs in the forestry sector in the longer term.

The Commission assessed the measure under its 2014 Guidelines on State Aid for Environmental Protection and Energy. Under the rules Member States can grant state aid for renewable energy and energy efficiency purposes, subject to certain conditions. The Commission found that the Metsä project will significantly increase electricity production from renewable sources in Finland as well as achieve significant energy savings. Its analysis also showed that the aid does not lead to overcompensation and that the aid amount did not exceed the allowable compensation for the cost of the investment in renewable energy and energy efficiency.

The Commission therefore concluded that the project will contribute to the EU Energy Union goals without unduly distorting competition and that the support from Finland is compatible with EU state aid rules.

Background

For more information on the 2014 Guidelines on State Aid for Environmental Protection and Energy, see also the Commission's Policy brief on "Improving State Aid for Energy and the Environment.

The Investment Plan focuses on removing obstacles to investment, providing visibility and technical assistance to investment projects and making smarter use of new and existing financial resources. Money from the European Fund for Strategic Investments (EFSI) does not constitute State aid and is not subject to EU State aid rules. The loan provided by the European Investment Bank (EIB) is based on the bank's own resources and also does not constitute State aid.

The Investment Plan is already showing results. The EIB estimates that by February 2016, the EFSI triggered more than €60 billion of investment in Europe. Find out the state of play as of January 2016, including a break-down by sector and by country. For more information see the FAQs.

The non-confidential version of the decision will be published in the State aid register on the DG Competition website under the case number SA.42382 once eventual confidentiality issues have been resolved. The State Aid Weekly e-News lists new publications of state aid decisions on the internet and in the EU Official Journal.

IP/16/724

Press contacts:

General public inquiries: Europe Direct by phone 00 800 67 89 10 11 or by email


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