Finnish government backs ETFuels e-methanol project
Finland’s government agency Business Finland has awarded investment tax credits of up to €118.6 million ($140 million) to Finnish fuel producer ETFuels Finland for its Ranua Näätäaapa e-methanol project.
IMAGE: Aerial view of Port of Rauma in Finland. Port of Rauma
An investment tax credit allows a company to reduce the amount of tax it pays by deducting a portion of its investment costs. Typically, this is intended to improve project economics by lowering upfront capital expenses, though the actual impact depends on project performance and tax eligibility.
“The investment credit, representing up to 20% of eligible capital expenditure, materially strengthens project economics and reduces effective capital intensity,” ETFuels said.
ETFuels is developing a 110,000 mt/year e-methanol facility in Finland’s Näätäaapa region, using green hydrogen and biogenic CO2 as feedstock. The project will be powered by renewable electricity from wind energy and supported by battery storage, according to the company’s website.
Output from the plant is expected to be supplied to European shipping and industrial customers.
The project is currently in its initial stage, and the tax credit will help support its progression into subsequent development phases, ETFuels said.
Finland aids renewable fuel production
Business Finland awarded a total of €2 billion ($2.35 billion) in investment tax credits to 37 projects in January 2026, with 32 renewable energy production and storage projects accounting for around €1.5 billion ($1.76 billion) of the total.
Under the scheme, “a company can start utilising the tax credit after the investment has been completed, the plant is operational, and the profitable business it generates produces taxable income,” the government notes.
The first deduction can be applied against corporate income tax from 2028.
Business Finland has also set a completion deadline of 36 months from the date the tax credit is granted.
If this deadline is missed, 1% of the approved credit will be deducted for each additional month, unless the delay is due to “unforeseen reason beyond the company's control," according to the agency.
By Konica Bhatt
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