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. Last Updated: 07/27/2016

Power Cable Diverted to Sweden

LONDON -- United Power Oy, a Helsinki-based company that was denied a permit to build a power cable between Finland and Russia, now plans one from Russia to Sweden so it can supply companies with electricity below market prices.

An interconnector from Russia to Sweden would cost about 280 million euros ($364 million) and take about two years to build, Andras Szep, the chairman of United Power, said Thursday in an interview in London. The earliest a cable could be ready would be in 2010 or 2011, he said.

Svenska Kraftnaet, the Swedish network owner, would need to take part in the project. "We're speaking to the grid and we think we can have a constructive cooperation," Szep said.

In 2005, a group of Nordic companies, including Stora Enso Oyj and Boliden, signed a supply contract with United Power to buy electricity imported from Russia through the planned cable to Finland. They would pay less than domestic suppliers charged. That contract is "pending" after Finland's Trade and Industry Ministry last month rejected an application to build the cable, Szep said.

"We've had contact with United Power and are awaiting their proposal," Maarten Nordgren, a spokesman for Svenska Kraftnaet, said Thursday.

Power prices in the Nordic region fell to records this month, as milder than average temperatures have reduced demand for energy. Power for next month today closed at 29.20 euros per megawatt-hour on the Nord Pool ASA exchange.

"Even if prices stay at these levels, we will still make a good profit," said Szep, 49, who started United Power in 2002.