Does Finland benefit from data centres?

On 1 July 2026 the electricity tax on Finnish data centres was raised from class II to class I. A targeted subsidy scheme is due in the autumn of 2026. The first week of July 2026 saw three US cases hit the headlines that illustrate local harms: bacteria discharged into municipal wastewater in Wyoming, 60 decibels of constant noise in a Michigan neighbourhood, and a class action against a 7.3 billion dollar Wisconsin data centre.

At the same time Finnish local councillors are working through concrete land-use planning: in Kirkkonummi the Microsoft project is moving forward with its building permit, in Rauma the cumulative effects of three projects are not being assessed, in Loviisa the wider energy-and-data-centre package lacks a cumulative-effects assessment. It is time to gather what we actually know about data centres in Finland and to look at what deserves more of the debate.

Finnish data centres in numbers

In July 2026 Finland hosts 44 data centres, of which only 7 have more than 20 employees. Verohallinto (Finnish Tax Administration) Director-General Markku Heikura presented the same figures in an interview with Hufvudstadsbladet at the start of May 2026. Building a data centre generates significant employment. Once in operation, the high level of automation makes employment much smaller. That said, traditional manufacturing is a somewhat poor benchmark here, given that no physical products are made in a data centre.

Data centres consume about 2 per cent of Finnish electricity in 2026, and according to Finnish Data Center Association (FDCA) Managing Director Antti ‘Jogi’ Poikola the share will grow to five or six per cent by 2030. Transmission system operator Fingrid has received data centre grid connection inquiries totalling more than 50 000 megawatts, of which Jussi Jyrinsalo, Head of Grid Planning, estimates about ten per cent will be built. That works out to roughly five gigawatts of additional load on the grid. For comparison: the winter 2026 consumption peak was around 15.5 gigawatts. By my own estimate, Finland’s current data centre potential is about 1.5 gigawatts.

The other side of the electricity system supplies the proportions. Finnish annual electricity generation is around 83 terawatt-hours. According to the Suomen uusiutuvat ry (Finnish Renewables Association) project list, the wind power permitting pipeline exceeds the current installed capacity many times over; more than 60 gigawatts is planned on land and more than 45 gigawatts at sea. Permitted wind projects are waiting for a customer: a single data centre investment typically triggers a long-term renewable power purchase agreement that finances the construction of a new plant. Data centres therefore expand renewable generation in the electricity market.

The scale also deserves an international perspective. According to DC Byte’s 2026 Data Centre Outlook report, more than 1 400 megawatts of data centre capacity was added in Finland across 2023 and 2024. In the US state of Virginia there is about 17 gigawatts of operational data centre capacity, and Dominion Energy has a further 47 gigawatts in the connection queue. Finland is still a small-scale country in this debate, though no longer marginal.

A few individual projects are worth keeping in mind. A two billion euro, 200 megawatt AI data centre is being built in Utajärvi with a 200 megawatt battery storage alongside it. The Campus Oulu data centre is coming up on the former Nokia site in Rusko, Oulu, with a long-term capacity potential of up to 300 megawatts, with about eight megawatts in the first phase. Microsoft in turn signed a preliminary agreement on approximately 190 hectares of land purchases on the Vaasa–Mustasaari border for a new data centre. Together these three projects almost double Finland’s current data centre capacity, if they are built at the scale planned.

To hold the scale in mind:

• Finnish data centres today: 44 sites, about 2 per cent of total electricity consumption.
• Forecast for 2030: 5 to 6 per cent of Finnish electricity.
• Fingrid data centre connection inquiries: more than 50 000 megawatts, of which about 10 per cent, or roughly 5 gigawatts, is expected to materialise.
• Reference point: winter 2026 consumption peak 15.5 gigawatts.
• Wind power permitting pipeline (waiting for a long-term customer, such as a data centre): more than 60 gigawatts on land and more than 45 gigawatts at sea.
• Virginia (US) as a benchmark: about 17 gigawatts of operational data centre capacity and about 47 gigawatts in the queue.

Value creation is one of the most important dimensions of the debate. Anthropic’s API pricing suggests that the end-customer price of AI use, that is inference, per kilowatt-hour is measured in dollars, whereas the Finnish wholesale price of electricity remains in cents. The order-of-magnitude difference is one hundredfold. That comparison is my own calculation from the public API price list, not a figure from an outside source, and journalist Niko Vartiainen’s investigation “Humiseva halli” in Uusi Juttu examined the same question. One important question in Finnish politics is how much of that value we should aim, and be able, to keep here: through ownership of data centres, contract terms, and the tax framework.

Why Ireland is not a benchmark for Finland

The most common example of a bad outcome in the data centre debate is Ireland. According to an International Energy Agency (IEA) projection, Ireland’s data centre share of electricity use rose from 21 per cent to 32 per cent between 2023 and 2026, and Friends of the Earth Ireland estimates that households paid an additional 715 million euros in electricity bills between 2015 and 2023, on average 360 euros per household. On the basis of EirGrid’s All-Island Resource Adequacy Assessment 2026–2035, the construction of new data centres in the Dublin area has been halted until 2028 because of a lack of grid capacity.

The claim that Ireland’s electricity price has tripled because of data centres is nonetheless misleading. Grid analyst Riku Merikoski shows in a LinkedIn analysis that Irish electricity prices track the development of natural gas prices, not the number of data centres. According to Merikoski’s data the wholesale price fell between 2021 and 2025, even as data centre construction grew. Data centre demand is a secondary factor in price development.

Finland differs from Ireland on four structural factors:

1. Our wind power potential clearly exceeds the projected data centre demand.
2. Data centres are geographically distributed. They have been built in Hamina, Utajärvi, the Oulu region, Kajaani and Kirkkonummi, and no single area develops a Dublin-style bottleneck.
3. Finland’s climate allows so-called free cooling, which brings energy efficiency to the top of Europe.
4. Data centre waste heat can be connected to the district heating network, which reduces combustion-based heat production. In Kirkkonummi this is part of the Microsoft project.

Electricity tax and the upcoming compensation subsidy

On 1 July 2026 the data centre electricity tax moved from class II to class I, from 0.05 cents to 2.24 cents per kilowatt-hour. The increase is about 45-fold, and the fiscal impact for the state is about 47 million euros a year. Some operators are reassessing the reform in July 2026: for example, Google Finland has paused planning of one data centre project for the review period. The increase removed the data centres’ separate tax relief and moved them to the general tax rate. Manufacturing industry continues to pay the lower class II rate.

The talouspoliittinen ministerivaliokunta (Ministerial Committee on Economic Policy) decided in December 2025 to prepare a targeted compensation subsidy scheme, intended in particular for “value-added” data centres. A data centre register is being prepared alongside it. The compensation subsidy scheme is not yet in force, and its criteria take shape during the autumn of 2026.

The criteria decide the whole character of the scheme. A targeted subsidy would turn into an opaque selection channel if “value-added” were defined so that the concept concealed discretionary power. The risk of crony capitalism is real here. The spring 2026 public debate on the biases of targeted support has shown that the mechanism deserves careful scrutiny. The criteria of the compensation subsidy scheme must be transparent, public, and applied neutrally. Otherwise the market mechanism is dismantled on one side at the same time as it is strengthened on the electricity tax side.

Local harms in the United States and Finnish permitting

Three cases surfaced publicly in the United States in the first week of July 2026 that illustrate what happens when preventive regulation is missing and the problems are left to the courts. Goat Systems LLC, the company building Meta’s Cheyenne data centre, discharged the rare Cupriavidus gilardii bacterium into the municipal wastewater system in a start-up flush, after which the Cheyenne Board of Public Utilities revoked all data centres’ fill-and-flush wastewater discharge permits until further notice.

In Dowagiac, Michigan, Alliance Cloud Services LLC’s data centre generates about 60 decibels of noise around the clock as measured in nearby residents’ yards, and residents filed a federal class action lawsuit in May 2026. Microsoft’s 7.3 billion dollar Fairwater data centre in Mount Pleasant, Wisconsin was hit with a class action from neighbours on 1 July 2026 over the noise impact of, among other things, diesel generators, HVAC systems, cooling towers and condenser fans.

Finland’s basic framework is better. Government Decree 993/1992 sets noise guideline values: 55 decibels by day and 45 decibels at night in urban areas, and 45 decibels in holiday housing. The Environmental Impact Assessment (EIA) procedure is triggered if a data centre’s backup power fuel capacity exceeds 300 megawatts, or if aggregate extraction exceeds 200 000 solid cubic metres a year. Zoning provisions can require district-heating use of waste heat, noise barriers for cooling equipment, and the protection of natural areas.

The problems are structural, not regulatory. Self-monitoring is vulnerable to manipulation when the authorities’ spot-check oversight is thin. Guideline values are applied through environmental permitting, so citizens have found it difficult to invoke them in zoning appeals. The cumulative effects of several projects are typically not assessed if each project is handled through a separate EIA procedure. These are first and foremost questions of adequate resourcing, not problems with the market mechanism. The solution is not to carve data centres out of the rest of industry as their own regulatory sector.

How are data centre projects progressing in Finnish municipalities?

In the summer of 2026, 10 concrete data centre processes are under way in Finnish cities and municipalities. The Kirkkonummi municipal building and environment committee granted the building permit for the first phase of Microsoft’s data centre in the autumn of 2024, with the use of data centre waste heat in district heating built into the plan. The second phase building permit is under consideration. The waste heat recovery to be carried out with Fortum would, once completed, cover about 40 per cent of the district heating demand of Kirkkonummi, Espoo and Kauniainen. The Espoo AtNorth data centre along Ring III (Kehä III) is an example of workable noise design in the Finnish permitting environment.

In the city of Rauma, one data centre project and two green energy production investments are getting under way at the same time. The local district heating network cannot make use of even one project’s waste heat because demand in the area is limited. The waste heat has to be discharged into the sea. Environmental impact assessments have not required an examination of the projects’ cumulative effects, because some of the projects have not yet materialised.

The data centre at Loviisa’s Itäinen Liittymä received its building permit in December 2025, and the forest has already been cleared. The same area has a large wind and solar power development pending and the sale of a nuclear power site. According to local councillors, no cumulative-effects EIA has been carried out on the package. In the Järvenpää server centre’s EIA report’s noise modelling annex a formulation attracted attention according to which the night-time noise limits are not exceeded if the backup generators are run for at most three hours. The actual noise level of the generators was not available to the officials presenting the case.

In Tampere, by my own estimate, the grid and the plots would be sufficient for a roughly 50 megawatt data centre whose waste heat could be almost entirely put to district-heating use. International investments are moving toward centres of 100 megawatts and larger, so the question is: will Finnish cities be able to attract the medium-sized centres too, where the local benefits would be greatest?

The difference between well-functioning permitting and adequate resourcing is felt directly in a resident’s daily life. Finland now has a short window to learn from others’ mistakes.

What I think about data centres

Emissions trading and spot pricing steer Finnish electricity markets toward balance, and the market mechanism encourages investment in renewable generation. Targeted grid balancing requirements or legislative initiatives that would require long-term power purchase agreements specifically from data centres are not needed, because they would break the market mechanism and arbitrarily punish a single sector. The public sector’s core responsibility is three things: maintaining grid capacity, clarity in the permitting process, and safeguarding the local environmental and health balance.

The compensation subsidy scheme should be approved in the autumn of 2026 on the condition that its criteria are public, transparent, and applied neutrally. At the same time, municipal oversight needs resourcing: spot-check sampling, independent noise monitoring, and cumulative-effects assessment of several projects. These are essential so that markets work fairly for everyone and residents’ wellbeing can be looked after.

The Vihreä liitto (Greens) information policy programme fits this: national requirements on the use of green energy and on heat recovery can be set, provided the requirements do not drive investments to countries with worse environmental standards. The same idea applies to the data centre register being prepared by the työ- ja elinkeinoministeriö (Ministry of Economic Affairs and Employment). The register is a natural place to collect purpose-of-use declarations, which would for example make it possible to disclose the share of cryptomining. Similar preparation is under way in Norway. Transparency is a precondition for the market mechanism to work.

I would sum up my own position like this: the electricity market, thanks to emissions trading, is an extremely well-functioning market in which price strongly guides toward equilibrium. Markets handle allocation, as long as they are not spoiled with sector-specific obligations.

Why are data centres a geopolitical question?

Data centres are also fundamentally tied to geopolitics: what the physical infrastructure of the hyperscalers on EU soil means for sovereignty, where Nokia and the Finnish engineering industry fit into that picture, and why the EU’s AI sovereignty tiers are worth reading before the autumn 2026 subsidy debate. Before that, it is worth pausing on one question: on whose terms are we building Finland’s digital infrastructure at a time when AI is again changing everything, or is it?