Finland’s parliament on Wednesday approved a 10 billion euro ($10 billion) rescue package for energy companies facing a cash crunch due to high market volatility following the invasion of Ukraine by Russia.
The package, comprised of loans and guarantees, is designed to stabilize the market and help cover companies’ liquidity needs resulting from increased collateral requirements for power futures.
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The government initially announced the package after Russia said it was cutting off the Nord Stream gas pipeline to Germany indefinitely due to what it said were leaks in a turbine.
Announcing the package on September 4, the government stressed that ensuring the efficient functioning of the electricity market was “essential for the functioning of the Finnish economy, society and security of supply”.
“It is also essential for individual electricity users.”
He said Finland would continue to discuss the situation with neighboring Sweden, which is preparing its own measures, and “will promote measures to ensure the functioning and stability of energy and derivatives markets in the EU”. .
Earlier this month, utility group Fortum and the Finnish state – which is also the majority owner – agreed to a bridge financing agreement to ensure access to sufficient liquidity resources if utility prices electricity continue to rise.
The liquidity facility gives Fortum access to €2.35 billion ($2.34 billion) through state-owned holding company Solidium, but Fortum said “use of the arrangement is a last resort.
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