The Finnish energy and climate policy framework and way forward

Transcription

1 The Finnish energy and climate policy framework and way forward Finlandsinstitutet, Stockholm 29 September 2014 Riku Huttunen Director General, Energy Authority, Finland

2 The Energy Authority promotes and regulates energy markets, reduction of emissions, energy efficiency and the use of renewable energy. 2

3 Where do we stand?

4 A success story The International Energy Agency: Finland has succeeded in developing a particularly well-diversified national energy production mix. Finland has a very ambitious renewables programme. one of the lowest shares of fossil fuels in its energy mix... electricity market has been largely liberalised. Finland notably leads all IEA members countries in terms of research and development funding for its energy sector. (IEA Country Review 2013) 4

5 Primary energy sources Statistics Finland

6 Electricity production Statistics Finland

7 EU goals goals (emissions, renewables, energy efficiency) Finland s renewable target is 38 % by 2020 Both EU and Finland are currently pretty well on track Integration of European electricity and gas markets by 2014 An end to isolation (energy islands) End to any isolation of Member States from European gas and electricity networks by 2015 Gas infrastructure projects in Finland and Estonia (Balticconnector and LNG terminals) At the moment, almost 100 % of gas imported from Russia 7

8 Nordic-Baltic electricity wholesale markets Effective competition, diversified energy mix Norway: hydro Sweden: nuclear & hydro Finland: nuclear, wood-based etc. Denmark: coal, wind etc. Trade with Russia Decreased imports due to capacity mechanisms Possibility to export (with 350 MW capacity) accepted by the Energy Authority At the moment: Flow SE => FI => EE More price differentiation due to limited transmission capacity 8

9 EU Electricity Market Coupling (day-ahead) North-West Europe + Iberia during 2014 In practice, physical limitations continue to exist and prices are differentiated

10 Where are we going to?

11 EU 2030 goals The European Commission suggestions: Emissions to be decreased by 40 % (from 1990 level) the primary target Emissions trading system (EU) + Non-ETS sectors (national responsibilities) Renewables share to 27 %; national targets? Energy efficiency: energy savings up to 30 % Ideas of the new college? Sustainability The European Council General goals in October Energy Union? What will be the balance? The Ukraine crisis, recession etc. affect Long/short term considerations The quality of EU legislation? Security of supply Competitiveness 11

12 The Finnish National Energy and Climate Strategy (2013 update) Some key conclusions: Om det uppställs endast ett mål som ifråga om sina styreffekter fungerar enligt planerna, dvs. målet att minska utsläppen, uppnås sannolikt den bästa kostnadseffektiviteten. bereds det en lag om energieffektivitetet. Productionen av biodrivmedel och flytande biobränsle ökas. Byggandet av vindkraftverk påskyndas Förbrukningens förmåga att anpassa sig efter produktionen förbättras Finland understöder tanken att elmarknaden så långt som möjligt också fortsättningsvis ska fungera på marknadsvillkor. 12

13 Nimellisteho MW Power production capacity till 2030 (business-as-usual) Nuclear power Other condensing power Coal condensing power CHP, heat and power Industrial CHP 2000 Hydro and wind Energy Authority

14 The topical issue: electricity production capacity Nuclear energy decisions-in-principle (under the Nuclear Energy Act): Fennovoima power plant (Hanhikivi 1) A positive vote (10-7) by the Council of State on 18 September the Greens left the coalition The Parliament needs to ratify the Decision TVO Olkiluoto 4 unit Council of State on 25 September: a negative decision (10-3) one player in the field cannot retain possession of a decision-in-principle about a project with a deadline of over five years in whose progress significant uncertainties are involved. The estimated electricity consumption in 2035: TWh 14

15 What kind of capacity in the future? Base production Intermittent production (RES) Reserve capacity? In any case flexibility is needed: Smart grids: Demand side response etc. Price signals reflecting the real-time production and market situation Optimization of the whole electricity system, including production investments We should trust the markets more both in the EU and nationally more focused subsidies (innovations) less and better regulation 15

16 Common interests of Finland and Sweden Electricity markets The Nordic market model the prime example of a liberalised international electricity market EU network codes are being developed at the moment Implementation in Europe might prove difficult; changes in the Nordics as well Climate-based issues Finland and Sweden are the northernmost EU Member States special needs Heating: e.g. technical specifications and energy efficiency requirements of boilers and heat pumps Emissions: carbon balance calculations (forests, swamps, ) The use and potential of biofuels Wood-based fuels and rawmaterials etc. 16

17 Thank you for your attention!