Selection of Partners for Metsähallitus’ Offshore Wind Power Projects

In addition to commercial criteria and demonstrated expertise, the requirements placed on selected partners focus particularly on financial strength, business planning and commitment to the project, as well as company- and project-level sustainability considerations, including environmental performance, climate objectives, social responsibility and good governance.

Base requirement:  proven track record

Successful implementation of an offshore wind power project requires prior expertise in the field. As with all major investment projects, offshore wind power projects require assurance that the necessary conditions for successful implementation are in place.

In addition to individual companies, consortia that collectively bring together the expertise, resources and proven track records required for the project may also participate in the tendering process.

Wind power projects that cost billions require a strong combination of experts and sufficient resources at different stages of the project. Long permit processes, commercial matters, project funding, technical planning and, ultimately, construction require a great deal of specialised expertise and skilled partner networks from the selected partners.

Attractive commercial terms

Metsähallitus will put out to tender the rights to the development projects as well as the rights to lease sea areas for offshore wind power production. In addition to the regular contract terms, the commercial terms consist of the price of the project rights and the lease terms of the state-owned sea area.

Sustainability requirements

Partners in offshore wind power projects are required to meet the minimum requirements relating to environmental matters, climate, human rights, occupational health and safety, and governance, as defined in the tender documentation. Sustainability requirements based on Environmental, Social and Governance (ESG) criteria are standard practice in international investment projects.

Companies operating in the offshore wind sector generally provide extensive public reporting on their sustainability performance and publish related information on an annual basis. During the tendering process, companies are thoroughly assessed with regard to areas including climate and environmental performance, social responsibility and human rights, occupational health and safety practices, and corporate governance.

Climate and environmental performance matter

Partners in offshore wind power projects must have a programme with clear objectives for reducing their climate impacts. In addition, the project must take the sensitive marine environment into account. For this reason, partners are required, as part of the environmental impact assessment process, to provide information on the measures they will take to prevent the loss of biodiversity.

Human rights and social impacts must be identified

Offshore wind power project partners are expected to comply with international commitments relating to human rights and labour rights. These include the human rights principles of the United Nations and the principles of the International Labour Organization (ILO). They must be taken into consideration in a transparent manner both in the partner’s own operations and throughout its subcontracting chains. Partners must also have established procedures in place to ensure compliance with these principles.

Partners are also required to have robust occupational health and safety management arrangements and must demonstrate adherence to good occupational safety practices.

Partners must commit to systematic stakeholder engagement. As a state-owned enterprise, Metsähallitus requires that the implementation of a long-term project that is significant for Finland, the regional economy and local communities is based on systematic and open interaction with all stakeholders.

Good governance is a basic requirement

Good governance and compliance with laws, regulations and sanctions are basic requirements to which offshore wind power companies are generally committed in their ethical principles and which they monitor as part of their normal activities.

The management, ownership arrangements and beneficial owners of the partner companies will be investigated. Aggressive tax planning is unacceptable. Linking sustainability issues to the criteria for the management remuneration of partner companies is a good indicator of the implementation of sustainable practices in the company. The partners must have zero tolerance for corruption.

The partners also commit to complying with the sanctions imposed by Finland, the EU and the United States. There can be no sanctioned parties in the partner’s subcontractor network.

Investigation and assessment by an independent body

Metsähallitus uses an independent external advisor to assess partners’ sustainability performance and reputation as part of an ESG due diligence process. Sustainability requirements are also included in the partnership agreements to be concluded after the end of the tendering process.