Climate change has become part of mainstream discourse in Finland. Markku Ollikainen believes that the Finnish Climate Change Panel, which he chairs, has played a role in this. The changes in the public discourse are taking place quickly, but so are the changes in the climate.

The average global temperature is rising as a consequence of human activity. A global temperature increase of two degrees would mean an increase of four degrees in Finland. Currently, the trend points at an increase of three degrees – six degrees in Finland. This means that in the next few decades, the line where coniferous trees become dominant will move further to the north, and there will be oak groves growing in the Jyväskylä region. If we do nothing or fail to do enough, the changes may be even more dramatic and serious.

“This should also be a concern for the Finnish forest industry,” says Markku Ollikainen, Professor of Environmental Economics, interviewed in his office at the Viikki campus of the University of Helsinki. Ollikainen believes that the deadline for radical reductions in emissions is 15 years.

Ollikainen chairs the Finnish Climate Change Panel set up by the current government of Prime Minister Juha Sipilä. The members of the panel are academic researchers from various fields. 

“The Climate Change Panel is an organization established by law. The Finnish Parliament passed the Climate Change Act a couple of years ago. It is the task of the Climate Change Panel to provide scientific advice, operating at the interface between politics and science. In other words, we disseminate scientifically proven information among decision-makers so that they are able to base their policies on science,” Ollikainen explains. 

According to the Intergovernmental Panel on Climate Change (IPCC), nuclear power is part of the solution to tackle climate change. The task is so immense it requires all means available.

The objective of the Climate Change Act is “to reduce anthropogenic emissions of greenhouse gases into the atmosphere, to mitigate climate change through national actions, and to adapt to climate change.”

All the members of the Climate Change Panel are academic researchers. Why?

“Our work is based on science. If different interest groups were included, we would become just another organization to negotiate between the interests of various operators. Our task is to give statements based on science. The decision-makers must then fit together all the different interests.”

The research subjects of the panel members are connected to climate change in one way or another. The panel itself does not organize research, but it prepares surveys and syntheses.

“Research themes are selected based on what we consider important and what our members are involved in. We engage in extensive cooperation with decision-makers and other researchers.

Complicated matters are rarely black and white or unambiguous. Ollikainen admits that even researchers sometimes disagree. Politicians must make the final conclusions and choose the values on which they base their decisions.

Cheap emission allowances weaken the emissions trading system

Finland is accountable to the EU for its climate action; a common emissions trading system has been set up to reduce emissions within the entire EU. The principle is simple: scarcity of emission allowances means that their price goes up, and businesses profit if they are able to reduce their emissions. Ironically, there has not been enough scarcity lately.

“Scarcity could have been created with a recent decision, but there was not enough political courage,” Ollikainen says.

He is referring to a decision by the EU to reduce emission allowances by 2.2% each year. Ollikainen supported an annual reduction of at least 2.6%, preferably 2.8%. He is convinced that the current reduction rate will not have an adequate impact. There is still an abundance of emission allowances on the market, which means that the prices are not likely to go up. No economic incentive for reducing emissions is being created.

What should be done?

“Finland has established a clear target for the reduction of emissions until 2050. The Climate Change Panel monitors the progress made on the target and promotes the achievement of the next milestone, the emission target for 2030.”

Ollikainen is annoyed by the fact that the diluted emission targets of the emissions trading sector – the power production sector and heavy industry – fail to create pressure for other emission sources to take action to reduce their emissions. Emissions from sources such as traffic and agriculture must now be reduced even more effectively. It will be more difficult and expensive than reducing emissions from power production and heavy industry.

The bioeconomy – threat or opportunity?

A report published by 68 Finnish researchers in March expressed concern about the Government's objectives for the bioeconomy. These objectives are a major part of Finland's climate strategy. According to the group of scientists, the increased use of wood fuels that is being planned will not work to mitigate climate change for many decades, and the current use and increased utilization of forests will risk natural diversity. Members of the Climate Change Panel were not part of this group of scientists, but Ollikainen is familiar with the problem.

“The Climate Change Panel has also taken a stand on the sustainable utilization of forests and created discussion on the subject. However, we must retain a focus on our own areas of expertise, and we will not enter into discussions on natural diversity. As a private citizen, however, I believe that any strong increase in the use of forests will create problems, considering the simultaneous cutting of conservation funds.”

Biomass can be converted into energy by burning it and by manufacturing biofuels. According to Ollikainen, the by-products of the forest industry – forest residue, liquors from the production process, etc. – would be the most appropriate raw material. The quantities now being planned would, however, require the use of good timber, which Ollikainen does not consider to be a sustainable practice. Forests store carbon from the atmosphere, functioning as a carbon sink that should not be destroyed.

“We believe that biofuels should only be manufactured from waste and by-products. There is no sense in reducing emissions from one end while increasing them at the other.”

Ollikainen is a strong promoter of electric vehicles.

“We think electric vehicles should be much more common. The current target is set at 250,000 vehicles, but looking at the manufacturers’ projections, electric vehicles could be quite competitive with combustion engine vehicles by 2023. Traffic has enormous potential for emission reductions.”


Electricity market is undergoing big changes

We must keep in mind that electric vehicles only serve to reduce emissions if the electricity they use has been generated using emission-free technology. Increased electrification of traffic predicts an increase the total consumption of electricity. 

Markku Ollikainen foresees great changes in the energy markets.

 “There will definitely be a big change. The electricity market will become decentralized. I don’t think we can go back to the way the electricity market used to be organized. Distributed generation of renewable energy and the related solutions will bring permanent changes. Consumers may become producers, and so on. There is an obvious risk that we will soon need an electricity capacity market.

The current state of climate change is reported in the regularly published Synthesis Report from the IPCC (Intergovernmental Panel on Climate Change). The researchers who prepare the report list nuclear power as one of the means of cutting greenhouse emissions and thus mitigating climate change.

The report from climate scientists summarizes a wide selection of energy scenarios that could be used to halt global warming at two degrees. It must be noted that all technically and economically feasible  two-degree scenarios include nuclear power in their selection of means.

Nonetheless, nuclear power often shakes off in a climate debate. Why is it so difficult to talk about?

“It is true that nuclear power tends to arouse feelings both for and against it. As the viewpoint of the panel, we cite the IPCC. All calculations, such as the energy and climate strategy, take into account the role of the nuclear power capacity currently under construction (Olkiluoto 3) as a source of condensing power and as the final building block to exclude coal as a condensing power fuel. As a result, fossil fuels will only be used in the production of CHP,” Ollikainen says.

“Still, I don’t see nuclear power as a watershed for climate policy. Let us look at three countries with active climate policies: Germany, France and the United Kingdom. Germany is currently dismantling nuclear power and investing in wind and solar power. France relies on nuclear power and has no intention of giving it up. Based on discussions with the British climate panel and their Foreign Office’s Special Representative for Climate Change, I understand that Britain intends to keep its options open: nuclear power might even increase up to 40 per cent of the total. The final choices will depend on factors such as the potential for storing electricity, which would allow the use of nuclear power as part of a load-following power solution, and the development of the relative prices of electricity from different sources.”

“I believe that these examples show fairly clearly that climate policy is possible with or without nuclear power. At the end, the dominant values of the country and the relative prices play a larger role in nuclear power decisions than climate policy does,” Ollikainen says.

What can we all do to reduce emissions?

According to Ollikainen, we can all make a difference.

“Of course, everyone can make personal choices. You can choose what you eat and buy, and easily cut your carbon footprint by nearly a third. Your choices have an impact on structures and generate growth in new fields. However, the choices of individuals cannot remove the whole problem. We need changes in structures, policies, and the way things are done.”

What will Finland look like in 15 years?

“Of course, I hope that we will still have our forests and the same Finnish wildlife,” Ollikainen says, smiling.

“We need to have clean, carbon-free power production capacity, and the emissions from traffic need to be close to zero. We have all the prerequisites for a radical decrease in emissions from private cars and to bring biofuels into airplanes and large vehicles. This would be a major structural change. We need compact, smart cities. The only source of actual emissions would be agriculture. We can never eliminate all agricultural emissions, but they can be reduced. Will we be using natural gas? I wonder about that. I can't say anything definite about it.”

Ollikainen trusts that the storage of electricity will develop further and that negative emissions – sequestering carbon from the atmosphere – will be possible. There is even a glimmer of hope that the age-old link between economic growth and emissions could be severed.

“In the last three years, global emissions have not increased, even though global combined GDP has grown three per cent.”

According to Ollikainen, there are many means for reducing emissions. They all should be utilized.

“Technical solutions are not the problem. There is plenty of viable technology, but we must be bold enough to adopt it. We have come a long way in these ten years, and that makes me hopeful.”