Will Finland be a Forerunner in Decarbonizing the Transport Sector?

1. VTT TECHNICAL RESEARCH CENTRE OF FINLAND LTD
Will Finland be a Forerunner
in Decarbonising the
Transport Sector?
IEA ETSAP Workshop on Decarbonising the
Transport Sector, 12th November 2017, Zürich
Tiina Koljonen & Antti Lehtilä
Place for a photo
(no lines around photo)

2. 218/12/2017 2
Starting point
 The EU has set new 2030 targets for greenhouse gas reduction
in the burden sharing sector (e.g. non-ETS) for each of its
Member States
 For Finland the new target is -39% GHG reduction compared with
2005 level (the 2020 target was -16% compared with the 2005
emissions)
 New energy and climate strategy as well as medium term
climate plan for Finland were approved in 2017
 These include concrete measures to reach both the EU and
national energy and climate targets by 2030

3. 318/12/2017 3
Impact assessments of national energy and climate
policies were carried out in a multidisciplinary research
project with five research organisations and more than
10 sectoral and integrated assessment models
Transport,
Buildings,
Agriculture,
Waste manag.
Energy
systems,
GHG
emissions
National
economies,
economical
structure
Regional
economies
in Finland
Health
Forest
industries,
Wood use,
Land use
Modelling
framework to
study the
impacts of
policies
Impacts on
environment,
nature, air
emissions
Scenario
analysis
Carbon
sinks
TIMES-VTT
Sector models

4. 418/12/2017 4
Transport accounts for 20% of Finland’s GHG
emissions and also has the greatest potential
for GHG mitigation in the non-ETS sector
MtCO2eq.
Other GHGs
Other CO2
Transport
CO2
Industry CO2
Energy CO2

5. 518/12/2017 5
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2020 2025 2030
Emissionreduction,ktCO2eq.
Waste management
Agriculture
(non-energy)
F-gas emissions
Housing, service &
agriculture buildings
Work machines
Domestic transport
Industry
Waste-to-energy
plants
Energy sector
GHG emissions of the transport sector should
be halved from the 2005 level to reach the non-
ETS target in 2030
2005 reference level
”Official WAM”
GHG emissions of domestic transport

6. Prime Minister Siplä’s Governmental Programme
 New energy and climate targets for 2030
 The share of renewable energy above 50% from final energy
consumption (EU2020 target 38%, which is already reached)
 Reduce the use of mineral oil by 50% (compared with 2005 level)
 Increase the share of domestic energy sources above 55%
 Phase out of coal in energy production
 Increase the share of renewables in transport to 40% (2020 target is
20%, which is already reached)
⇒Most of these targets have direct or indirect impacts on
transport sector

7. 718/12/2017 7
Mobility as a Service (MaaS)
 A long-term aim pursued in transport policy is a change
that would turn mobility into a service
 Finland is a pioneer in this "mobility as a service" thinking
 A parliamentary committee was established in 2016
Physical mobility and digital services should merge into a
high-quality door-to-door service
 Thus, the responsibility for innovations and service
development lies with the private sector
VTT’s robot cars Marilyn and Martti
Full automation
is still some
way off

8. 818/12/2017 8
Two core scenarios: WEM & WAM
 WEM (With Excisting Measures) scenario assumes existing Finnish
national policies and measures and EU 2030-policy targets for the rest
of the EU
 WAM (With Additional Measures) scenario assumes the EU 2030-
policy targets for Finland. Following measures have been approved:
 Biofuel blending obligation will be increased to 30% in road transport
(average in 2030), and additionally 10% for work machine diesel use and
heating oil use in buildings
 Electric cars at least 250,000, gas fueled cars at least 50,000 in 2030
 Waste incineration plants moved to ETS sector around 2022
 Flexible mechanisms are used to cover 2% points of the effort sharing non-
ETS sector emission reduction target
 The ETS price level is expected to be 15 €/tonne in 2020 and 30 €/tonne
in 2030 both in WEM and WAM, energy commodity prices are
endogenous

9. 918/12/2017 9
National policies and measures by 2030 to reach both
the RES and GHG targets in the transport sector
 30% biofuel blending obligation in road transport:
 New investments on advanced biofuel production plants (total new
capacity app. 600 000 ktoe/a), which will use domestic raw
materials (e.g. mainly wood residues but also other biowastes, and
other raw materials)
 Increase the number of electric vehicles up to 200 000 and gas
fuelled vehicles up to 50 000
 No agreed policies yet how to do this
 Increase of energy efficiency of the vehicles and the whole the
whole transport system
 New EU regulations, MaaS, increase of public transport, walking &
cycling, efficiency & logistics of heavy transportation, etc. etc.

10. 1018/12/2017 10
National and EU level policies and strategies
will define the mitigation path up to 2050
0
10
20
30
40
50
60
70
80
90
1990 2000 2010 2020 2030 2040 2050
GHGemissions(excl.LULUCF),MtCO2e
Inventory 2 degree scenario
-40% GHG reduction (EU target)
-55% renewable target
-40% renewables in transport
-Phase out of coal
-Halving the use of mineral oil
-20% GHG reduction (EU target)
-38% renewable target
-20% renewables in transport
-80-95% GHG reduction
(EU and national target)

11. 1118/12/2017 11
Large share of RES growth is happening without any
policies due to growth of forest industries
=> Opportunities but also challenges for advanced biofuel production
0
100
200
300
400
500
600
700
20302025202020152010
Renewableprimaryenergy,PJ
WEM
WAM
WEM
WAM
WEM
WAM
WEM
WAM
Ambient
Solar
Wind
Hydro
Waste
Bioliquid
imports
Agrobio
Black
liquor
Wood
Renewable primary energy WEM vs. WAM

12. 1218/12/2017 12
Note: Only focal fractions of total oil consumption included, as defined
in government programme
0
50
100
150
200
250
300
350
20302025202020152010
Mineraloilproductsconsumption,PJ
WEM
WAM
WEM
WAM
WEM
WAM
WEM
WAM
Work
machines
Transport
Buildings &
agricult
Industry
Power and
heat
Oil consumption by sector (government’s definition)
Fossil oil is mainly replaced by advanced biofuels but
also due to electrification

13. Wood consumption: 2013 vs. 2030
WEM vs. WAM not a big issue except in public debate
0
20
40
60
80
100
120
2013 2030
Wood,millionm3
WEM WAM
SNG*
Liquid fuels
Solid energy
use
Recovery
boiler
New fibre
products
Paper pulps
Wood
products
* SNG=synthetic natural
gas from wood

14. 1418/12/2017 14
Forest sinks are halved but returned back due to forest
renewal (Source: National Resource Institute of Finland)
After the latest inventory of the forest stock, the increase of forest
sinks is larger than in the below figure
Impacts of 2030
strategies
Maximum sustainable use of wood
Low industrial
use of wood

15. 1518/12/2017 15
Major uncertainties and pain points
 EU policies:
 Sustainability criteria of wood => delays in investments in Finland
 LULUCF policies => how carbon sinks are calculated (e.g. baseline)
 New RES markets based on RED2 => investments could move to other
EU countries
 National policies
 How to ensure early enough investments, especially for biofuel plants
 How to ensure that Finland will have 250 000 electric vehicles by 2030
(today less than 1000)
 How to ensure that our transport system will become more efficient (e.g.
the growth of transport demand should be flattened)
 How to ensure social equality of people living in rural areas

16. 1618/12/2017 16
New opportunties from VTT in collaboration
with Lappeenranta University of Technology
 Fuels can be made from air … and food from electricity

17. Additional information
Tiina Koljonen
Research Team Leader
Energy systems and Climate
tiina.koljonen@vtt.fi
Tel. 050 359 9549