25 June 2018
Finland scaling up the success of Energy Innovations and PPP on the road towards Carbon neutral society

By Kimmo Tiilikainen, Minister of the Environment, Energy and Housing of Finland, (pictured)
Spring 2018


Kimmo Tiilikainen, Minister of the Environment, Energy and Housing of FinlandFinland’s long term goal is a carbon-neutral society and we are working hard to reach that goal in 2045. The Government approved the National Energy and Climate Strategy to 2030 on November 2016. The strategy sets out concrete actions and targets through which Finland will achieve international and the EU energy and climate objectives. Our national goal is to cut the use of fossil oil by half, raise our share of renewable energy in total energy to 50 percent by 2030 and to stop using coal by 2030. A survey of actions needed and costs rising will be completed by the end of March. It also looks at the option of ending the use of coal by 2025.

Diverse actions are needed including the potential of biogas. Forest growth is utilized in reaching the climate targets in a way that ensures sufficient carbon sinks, also in the future. Climate targets can well be reconciled with the protection of biodiversity,

Key drivers of change are associated with technology development, decentralized and renewable energy production, digitalization, urbanization and the consumer’s more important role. Energy production alone will no longer be the most significant business area in the future, as the energy sector also will increasingly turn into a service business.

One of our common challenges is the global urgency to move towards sustainable, low carbon economic growth and to address climate change while meeting the increasing demand for energy. In this transition, the role of international cooperation is crucial.

But it is not only the Governmental actions needed. Business life and companies as well as individual citizens have to do their share for better climate and environment. There are many signs, that climate is changing rapidly and to avoid harmful effects, we have to implement cleaner and better energy infrastructure all around the world.

The future energy system will be flexible and intelligent. In addition to directing energy production, energy consumption may also be managed and coordinated as indicated by the current production situation. Hybrid systems that combine different forms of production will become more widespread.

Flexibility of demand will change the role of the consumer. An active consumer will simultaneously consume, produce and store energy. Digitalization and the Industrial Internet will help improve the efficiency of energy use everywhere. Energy efficiency is a cost-effective way of reducing greenhouse gas emissions, and the circular economy mentality will further increase the efficiency of resources use.

OUTLOOK FOR TECHNOLOGY DEVELOPMENT
The markets are increasingly showing interest in solutions that reduce the use of non-renewable and fossil raw materials. Solutions are sought in bioeconomy and new, biomass-based products and services. Bioeconomy comprises a lot more than just bioenergy and biofuels. Wood-based fibre can be processed into high-value chemicals, for example for the needs of the pharmaceutical and chemical industries. Nutrient cycling is another example of the business opportunities offered by the bioeconomy.

It is estimated that the share of sustainable bioenergy will be about one half of all renewable energy supply in 2030. Carbon-neutral transport will initially be achieved by using the potential of all carbon neutral sources, including biofuels. When investing in EVs and Hydrogen, also promoting the deployment of biofuels in heavy goods vehicles will be important. Sustainability will be a key factor, and international trade will grow. The raw material base of bioenergy will expand and increasingly rely on wastes, which will also encourage biogas use.

Wave energy is an example of a field where Finnish technology and companies are on the global leading edge without a domestic market. Wave energy is expected to be commercialised after 2020. The first more extensive sites will be off-shore wind farms, where wave energy production may benefit from shared network connections.

Finland is one of the most energy intensive per capita countries in the word. Improving energy efficiency is a very cost-effective way of reducing CO2 emissions. We have a lot of experience and know-how for efficient industrial processes and buildings as well as improving energy efficiency at the system level. In the future, the energy system of an intelligent home can be used by the market driven consumer to control the electric devices, energy production and storage, and electricity trade of the household.

Intelligent transport will also increase service business, and the MaaS (Mobility as a Service) model will promote more efficient energy use. Intelligent transport is now looking to the new Transport Code that strives to renew and develop the entire transport sector as digitalization advances.

BUSINESS OPPORTUNITIES AND STRONG PUBLIC-PRIVATE PARTNERSHIPS
Finland's success is based on strong public-private partnerships, world-class technical expertise and innovations. We are very pleased to promote and implement Clean Energy Solutions together with other partners. And we really need cooperation and help from our partners even in Finland.

Power electronics represents top expertise from Finland. Distribution networks will feature power electronics and intelligent properties. Finland could also offer expertise for turnkey system deliveries, but a large operator would be required to ensure competitiveness in the global market.

Virtualization, on the other hand, is associated with technology that enables the simulation of reality. In the flexible energy system of the future, virtual power plants may have a key role in controlling such aspects as decentralized energy production, storage and consumption.

The flexible energy system of the future, in which the consumer plays an essential and significant role, will also create a need for different security technologies. The importance of cybersecurity will be highlighted, bringing new business opportunities.

The greatest growth is expected in the fields of wind power, solar energy, biomass boilers and small-scale CHP technology. In these, Finland's areas of strength are wind power components, biofuels and biotechnologies as well as gas-fueled engines and power plants. Potential export sectors also include turbine generators for small-scale and mini hydroelectricity installations and technological and system expertise in solar energy and fuels cells.

To reach Finland's ambitious energy and climate targets and long-term goal to become carbon neutral society needs also investments in research, development and innovations.

Innovation Funding Agency Business Finland started last year a Smart Energy Innovation Program which target is to create new global business for Finnish companies, investments in Finland, create top research in energy sector and support Finland to achieve its’ international targets. The Smart Energy Program aims to build different kind of test platforms to promote these targets.

Pilot platforms have a crucial role in bringing different actors together, networking them for new kind of co-operations and boosting joint competences. Platforms link research actors, big companies and SMEs in dynamic and flexible manners. As a term, platform can have multiple meaning ranging from dedicated pilot setups to wide co-operation environments. Commonly, platforms apply open principles for instance for sharing data, co-innovating and memberships.