Finland money

Finland offers loan and guarantee scheme for electricity companies –

A program of loans and guarantees of up to 10 billion euros for power generation companies threatened with insolvency was approved by the Finnish government on Sunday.

The scheme, under which the state can provide loans or guarantees, covers liquidity needs arising from increased collateral requirements for their electricity derivative contracts. Due to be submitted to parliament on Monday, it is expected to run until the end of 2023, with two-year loan periods.

Finance Minister Annikka Saarikko (Centre) stressed during a press briefing that there would be no “free money” offered but guarantees and loans “as a last resort” with “extremely strict conditions” only to ensure the liquidity of the companies.

The government’s decision comes the day after the measures announced by Sweden on Saturday. Unlike the Swedish scheme, which is open to all Nordic and Baltic companies, the proposed funding will only be available to Finnish companies, said Economic Affairs Minister Mika Lintilä (Centre).

Sweden and Finland were in contact over their respective decisions over the weekend. The Finnish government has said it is ready to continue discussions with Sweden if necessary.

Behind the emergency measures are soaring energy prices, resulting in a need for more. collateral. This has led to a shortage of liquidity for energy companies and caused higher prices for longer-term derivatives and the risk of a liquidity crisis.

Prime Minister Sanna Marin referred to this “structural problem” and said Finland was waiting for a reaction from the European Commission. “Finland cannot handle this alone,” Marin said. According to Saarikko, Finnish ministers will raise the issue at EU meetings this week.