Reform of the Renewable Energy permitting Act and the Act on the Handling of Environmental Matters by the Finnish Supervisory Agency

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The Government is proposing significant reforms to environmental legislation and the organization of environmental administration. Several of the proposed changes will affect all projects and activities requiring an environmental or water permit. In addition, the permitting process for renewable energy projects will be expedited through separate regulatory amendments. Below, we have summarized the key changes and their impacts on project development and permitting.

Comprehensive reform of environmental administration and the so-called “one-stop-shop” model

The Government is proposing a comprehensive reform of the environmental administration through the proposal for an Act on the Handling of Certain Environmental Matters by the Finnish Supervisory Agency (the “Environmental Matters Handling Act”). The Government Proposal was submitted on 30 April 2025 and approved by the Parliament on 18 June 2025. The Act will enter into force at the beginning of 2026, at which time the new Finnish Supervisory Agency will also commence operations. Prior to its entry into force, the Act must still be ratified by the President.

The purpose of the Environmental Matters Handling Act is to streamline the permitting procedures for all projects requiring an environmental or water permit. Under the new framework, key environmental procedures currently handled by the Regional State Administrative Agencies and ELY Centres will be transferred to the newly established Finnish Supervisory Agency. These include permit matters under the Environmental Protection Act, the Water Act, and the Nature Conservation Act, as well as tasks related to environmental impact assessment procedures and the supervision of permits. At the same time, the Act on the Processing of Environmental Protection and Water Matters by the Regional State Administrative Agencies and the Act on the Coordination of Certain Environmental Permit Procedures will be repealed.

As a result of the reform, applications for permits under the Environmental Protection Act and the Water Act will, as a rule, be processed jointly. An application for a derogation concerning the protection of a habitat type or species under Sections 66 or 83 of the Nature Conservation Act may also be decided within the same procedure, unless a separate procedure is deemed justified. In addition, land extraction permits may fall within the scope of joint processing, provided that the Finnish Supervisory Agency, rather than the municipality, is the competent authority for the project in question.

In joint processing, the permit application under the aforementioned Acts is handled together and decided in a single decision. As a result, the granting of a permit requires that the conditions for approval under all applicable laws involved in the procedure are met. However, separate processing remains possible if, for a specific reason, joint processing is deemed unnecessary. Such a situation may arise, for example, when a previously granted permit needs to be amended and a re-evaluation of all related environmental permits is not considered necessary.

The right of appeal in relation to a permit granted through joint processing is, as a rule, determined in accordance with Section 191 of the Environmental Protection Act. This means that in matters resolved under Sections 66 and 83 of the Nature Conservation Act as part of joint processing, the right of appeal will be broadened compared to the current regime, and the existing regional restriction on rights of appeal will be removed. The appeal will continue to concern the entire permit package resolved by a single decision.

At the request of the applicant or with the applicant’s consent, the processing of an application for an environmental permit or a permit under the Water Act may also be coordinated with the permit procedure under the Act on the Safe Handling and Storage of Dangerous Chemicals and Explosives (390/2005, as amended). In such cases, coordination primarily concerns the timing of the permit decisions. Even if the procedures of the Finnish Supervisory Agency and the Finnish Safety and Chemicals Agency are coordinated, separate decisions will still be issued for each permit application. The authorities must coordinate their processing so that the decisions are issued simultaneously.

The priority given to the green transition, which entered into force in 2023, applies to environmental permits and permits under the Water Act. Projects complying with the “do no significant harm” principle have been able to receive priority in the permitting process, and permits have been required to be processed within 12 months from the publication of the permit application notice. The proposed Environmental Matters Handling Act now extends the application period of this priority until the end of 2030. The provisions on the expedited processing of appeals related to projects having granted priority will also continue to apply, with their validity extended until 2032.

In connection with the described legislative reform, amendments will also be made to the Act on Environmental Impact Assessment Procedure (the “EIA Act” 252/2017, as amended). Following the amendments the EIA procedure must include a description of the project and its likely significant environmental impacts. While it remains possible to describe the measures to avoid or mitigate significant adverse environmental impacts of the project, this requirement will be relocated, for clarity, to Section 1 of the EIA Decree, which lists other information to be provided by the project proponent when deciding on the applicability of the assessment procedure in individual cases. Additionally, the EIA threshold for wind power projects under Annex 1 of the EIA Act will be lowered to five turbines, while maintaining the total installed capacity threshold at 45 megawatts.

Acceleration of permitting procedures for renewable energy projects

In addition to the reform of the environmental administration, amendments are also underway to the Act on the Permitting Procedures for Renewable Energy Plants and Certain Other Administrative Procedures (the “Renewable Energy Permitting Act”), due to the implementation of the Renewable Energy Directive (EU) 2023/2413 (“RED III”). The Government Proposal was submitted to the Parliament on 30 April 2025, and the Parliament approved the proposal on 18 June 2025. The aim is for the Renewable Energy Permitting Act to enter into force without delay, with the exception of the provisions on the designation of renewables acceleration areas, which will enter into force at the beginning of 2026. The Act must still be ratified by the President before it can take effect.

The most significant proposed changes include the expansion of the scope of the Act, the establishment of renewables acceleration areas, and the introduction of binding deadlines for permitting procedures concerning renewable energy plants, along with changes to the duration of those deadlines.

Scope of application of the Renewable Energy Permitting Act

Under the current Renewable Energy Permitting Act, the procedural deadlines apply to renewable energy power plants, i.e. electricity-producing renewable energy plants. These deadlines have been applicable to plants that produce energy wholly or partially from renewable sources. Under the proposed reform, the deadlines will also apply to other types of renewable energy plants in addition to power plants. The definition will in the future also cover, for example, energy storage facilities located at the same site as the plant. To qualify for the application of the procedural deadlines, the plants must produce renewable energy exclusively.

The deadlines will continue to apply to all permitting procedures already covered under the current law, and the scope of application will be expanded to include five additional permitting and administrative approval procedures. These include derogation procedures under the Nature Conservation Act regarding the protection of species and the prohibition on the deterioration or destruction of natural habitats, the expropriation permit procedure under the Act on Expropriation Permits, where it concerns connecting a renewable energy plant to the grid, the emissions permit procedure under the Emissions Trading Act, the exploitation permit procedure under the Act on the Exclusive Economic Zone, and the project permit procedure under the Electricity Market Act for the construction of high-voltage power lines.

It is noteworthy that environmental assessments, namely EIA and Natura assessments, are not included within the scope of the procedural deadlines. While RED III intends for environmental assessments to fall within the deadline framework, the national implementation has taken the view that such assessments may be excluded. However, when approving the Renewable Energy Permitting Act, the Parliament required compliance of the legislative provisions with the RED III Directive to be examined, and, if necessary, a legislative amendment to be prepared to bring environmental assessments within the scope of the procedural deadlines.

Deadlines for renewable energy permitting procedures

As a result of the reforms, the contact point authority will be obliged to ensure compliance with the procedural deadlines for permitting processes. The processing period begins when the competent authority determines that the first application related to the project is complete, unlike under the current law, where the deadline begins upon the submission of the application. An application is considered complete when it and its annexes meet the legal requirements and enable the application to be processed.

The deadline is project-specific, meaning that the total duration of all procedures subject to deadlines within a single project must not exceed the binding processing time allocated to the project. However, the deadline does not run while the permit application is subject to an appeal. The reform notes that the new deadlines will shorten processing times for some projects, but for certain projects, the proposed deadlines will be longer than under the current regime.

The new deadlines for decisions to be taken by the authorities are shown in the list below:

Procedural deadlines for decisions regarding projects outside renewables acceleration areas

  1. Renewable energy plants with an electrical capacity of less than 150 kilowatts located on land areas and updates of renewable energy power plants located on land areas: 1 year
  2. Renewable energy plants located on land areas other than those referred to in point 1: 2 years
  3. Renewable energy plants with an electrical capacity of less than 150 kilowatts located in sea areas and updates of renewable energy power plants located in sea areas: 2 years
  4. Renewable energy plants located in sea areas other than those referred to in point 3: 3 years

Procedural deadlines for decisions regarding projects in renewables acceleration areas

  1. Renewable energy plants with an electrical capacity of less than 150 kilowatts located on land areas and updates of renewable energy power plants located on land areas: 6 months
  2. Renewable energy plants located on land areas other than those referred to in point 1: 1 year
  3. Offshore wind farms with an electrical capacity of less than 150 kilowatts located in sea areas and updates of offshore wind farms: 1 year
  4. Renewable energy production facilities located in sea areas other than those referred to in point 3: 2 years

Renewables acceleration areas

A new section will be added to the Act concerning renewables acceleration areas, where the deadlines for decisions to be taken by the authorities for planned projects will be shorter than for projects in other areas. Renewables acceleration areas may be located on land areas, in sea areas or inland waters, and the deployment of renewable energy production in such areas should not have significant environmental impacts. These areas are therefore considered particularly suitable for the placement of renewable energy plants, with priority given to artificial and built surfaces and areas affected by human activity. Certain restrictions have been imposed on the designation of areas to become renewables acceleration areas in order to protect areas of particular importance and areas that are vulnerable to environmental impacts.

The Finnish Supervisory Agency will be responsible for designating renewables acceleration areas from the beginning of 2026, with the ELY Centres handling the related preparations until then. The areas will be designated based on proposals from municipalities. The public will have the opportunity to influence the designation of areas as part of the designation process in accordance with the SOVA Act (Act on the Assessment of the Effects of Certain Plans and Programmes on the Environment, 200/2005 as amended) in the early stage consultation and in the consultation on the environmental report and draft decision.

An appointment decision will be made on the designation of renewables acceleration areas, and the initial phase will focus on designating areas for solar energy production. The designation decision will specify certain forms of renewable energy production and mitigation measures to be followed in order to avoid or reduce the adverse environmental impacts of the project. However, the designation of renewables acceleration areas does not reserve the area for the designated use; other activities may also be planned and approved for the areas.

Projects planned for renewables acceleration areas may be exempted from the EIA procedure and Natura assessment if they fall within certain project types specified in Article 14(d) of the EIA Directive (2014/52/EU). Such project types may include, for example, wind power, hydropower plants and certain industrial production facilities for electricity, steam and hot water. In order for the exemption to be granted and the shorter permit processing times to be applied, the projects must also comply with the conditions for mitigation measures set out in the decision designating the area as a renewables acceleration area. However, exemptions cannot be granted to projects that are likely to have significant environmental impacts in another EU Member State. Even if a project is exempted from the requirements, it will still go through a screening process to determine whether it is likely to have significant adverse effects that could not be foreseen when the renewables acceleration areas were designated. An administrative decision will be issued on the outcome of the screening process.

 

Would you like to know how the new regulations will affect your specific project? We would be happy to discuss the matter in more detail and help you identify the concrete implications of the changes for your business. Please contact us – our experts are ready to support you in implementing the changes.

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