Kilpilahti Combined Heat and Power Project,

Finland
Key Data

Project Type Power plant modernisation

Installed Capacity Thermal Heat: 450MW, Electricity: approximately 30MW

Developer and Owner Kilpilahti Power Plant, a joint venture (JV) of Neste Oil
Corporation (40%), Veolia Group (40%) and Borealis (20%)

Operations and Maintenance Veolia Services Suomi Oy, a subsidiary of Veolia

Start of Operations Mid-2018

EPCM Contractor Tcnicas Reunidas (TR)

Estimated Investment 400m ($447m)

The Kilpilahti combined heat and power (CHP) project is a modernisation project that aims
to replace two old boilers and two steam turbines from the existing power plant in the
Kilpilahti industrial area in Porvoo, approximately 40km east of Helsinki, Finland.
Proposed installed capacities for the project are 450MW of thermal heat and approximately
30MW of electricity. Thermal heat will be supplied to Neste Oil's refinery and the
petrochemical plant of Borealis within the same site, while electricity will be supplied to the
grid. The project will also produce demineralised water.
The project achieved financial closure in March 2015, while commissioning is scheduled for
mid-2018. It is expected to generate up to 700 jobs during the construction phase and up
to 40 jobs during the operations phase.

Ownership and operator details

The project is being developed by Kilpilahti Power Plant, a joint venture (JV) of Neste Oil
Corporation (40%), Veolia Group (40%) and Borealis (20%).
It will be operated and maintained by Veolia Services Suomi Oy, a subsidiary of Veolia,
under a 20-year agreement. Neste Oil transferred the ownership of the power plant to the
JV in March 2015.

Existing Kilpilahti power plant details

The existing power plant is equipped with two gas and oil boilers, and two steam turbines
that were commissioned in 1971, a gas boiler commissioned in 1989, and two gas turbines
commissioned in 1989 and 1997 respectively.

Kilpilahti CHP power plant make-up and construction details

The project involves the replacement of the facilities commissioned in 1971 by installing a
main circulating fluidised bed (CFB) boiler using asphaltene as its main fuel, two oil and gas
steam boilers using different gaseous and liquid fuels produced as byproducts from the
adjacent facilities of Neste Oil and Borealis, and a new steam turbine.
New units of the multi-fuel CHP plant will be constructed adjacent to the existing power
plant and share existing fuel supply pipelines, cooling water systems, drainage facilities, the
110kV grid connection network and ancillary facilities.
The project will further involve the construction and installation of a new demineralised
water plant and its ancillary automation systems, a new electrical room, a control room,
and an office building.

Sustainability
Compared to existing facilities, the project is expected to reduce carbon dioxide emissions
by approximately 20%. It will be constructed to comply with the latest environmental
regulations, including the European Commission's Industrial Emissions Directive (IED).

Gaseous emissions will be reduced from the main boiler by deploying enhanced
combustion technology. A particle filtration system will be installed to reduce dust
emissions, a flue gas scrubber will remove sulphur dioxide, and a selective catalytic
reduction (SCR) system will reduce nitrogen oxide emissions.
In addition, adequate walls and devices will be placed to mitigate noise.

Key players involved with the Finnish power plant

The engineering, procurement, construction and commissioning (EPCC) contractor for the
project is Tcnicas Reunidas (TR). Neste Jacobs has been contracted to integrate project
facilities with the existing facilities.
The environmental impact assessment (EIA) study for the project was performed by Pyry
Finland Oy.

Financing
The total investment in the project is estimated at 400m ($447m approximately). The
European Investment Bank (EIB) is providing a 175m ($195m) long-term loan, while the
Nordic Investment Bank is providing a 80m ($89m) loan.
Other commercial banks funding the project include the Bank of Tokyo-Mitsubishi UFJ
(BTMU), ING, Nordea, Skandinaviska Enskilda Banken (SEB), and Unicredit.