OPET Finland ENERGIE Renewable Energy Sources in Finland 2002 OPET Report 9 OPET FINLAND Jyväskylä 2002 PRO2/T6509/02 Renewable Energy Sources in Finland 2002 OPET Report 9 Eija Alakangas OPET Finland – VTT Processes JYVÄSKYLÄ 2002 Copyright ©OPET FINLAND 2002 PUBLISHERS Technical Research Centre of Finland (VTT), Processes Koivurannantie 1, P.O.Box 1603, FIN–40101 Jyväskylä Finland phone internat. + 358 14 672 611, fax + 358 14 672 598 Motiva Oy Information Centre for Energy Efficiency and Renewable Energy Sources Urhokekkosenkatu 4-6, P.O.Box 489, FIN-00101 Helsinki Phone internat. +358-9-8565 3100, fax +358-9-8565 3199 National Technology Agency, Tekes Kyllikinportti 2, P.O. Box 69, FIN-00101 Helsinki Phone internat. +358-10-52151, fax +358-10-521 5905 This publication is available as PDF-format at Internet: www.tekes.fi/opet KOPIJYVÄ, JYVÄSKYLÄ 2002 Alakangas, E. Renewable energy sources in Finland, 2002, OPET Report 9. OPET Finland. Jyväskylä 2002, 51 p. + app. 20 p. Keywords renewable energy sources, Finland, solar energy, bioenergy, hydropower, heat pumps, biogas, wood fuels, wind energy Abstract Approximately 30% of Finland’s total energy consumption is met by using indigenous energy sources. Wood, hydropower and other biomass accounted for roughly 25% of Finland energy supply in 2000 (1 318 PJ). This is one of the highest figures among the leading industrialised nations (EU average being 6%) and makes Finland the leading country in the use of biomass. Bioenergy is accounting for 85% of renewable energy sources (328 PJ) in 2000. In Finland, the main provider and user of wood-based energy is the forest industry, which obtains wood fuels at a competitive price in connection with raw material procurement or as a by-product of wood processing. About 35 million m3 solid of wood (271 PJ) is used annually in Finland for energy production, covering 20% of the total consumption of primary energy. Most of the wood-based energy is recovered from liquid and solid industrial wood residues. Forest fuels comprise only a modest share. Increasing the use of renewable energy sources is one of the main objectives of the National Climate Strategy. Measures aimed at achieving this goal are presented out in the framework of the Action Plan for Renewable Energy, and should culminate in approximately one quarter of the total reduction target of Finland’s greenhouse emissions in 2010. The objective in energy use is to bring an increase of about 50% in the use of renewable energy by 2010 compared to that in 1995. The Action Plan for Renewable Energy given by the Finnish Ministry of Trade and Industry in 1999. In 2002 revised Action Plan for Renewable Energy for 2003 – 2006 the working group sets the objective of increasing the use of renewable energy sources by another 7% by 2010. The greatest potential in this regard lies in the increased use of wood for heat production and for combined heat and power production in both industry and the municipal districtheating sector. Key promotion measures are development of technology and commercialising of new technology, energy taxation, investment subsidies, and dissemination of information. Investment subsidies are targeted primarily at production plants employing new technology solutions. This report is a summary of the current situation and future plans of renewable energy sources in Finland. 4 Preface This report is a summary of the current situation and future plans of renewable energy sources in Finland, published by OPET Finland. OPET Finland is a part of the OPET Network - Organisation for the Promotion of Energy Technologies. It operates under the EU 5th Framework Programme for Research and Development, as part of the Energy, Environment and Sustainable Development Programme. More than 100 organisations from 48 countries, both in Europe and elsewhere, are participating in the network. The aim is to promote the application of new energy technologies by various measures. OPET Finland is a co-operation organ of National Technology Agency, Tekes, Motiva Oy, and VTT Processes. VTT has prepared this report based on the material and comments received from the following experts: Ms. Marjatta Aarniala, Tekes (R&D funding), Mr. Ilari Aho, Motiva Oy (heat markets), Ms. Satu Helynen, VTT (bioenergy), Mr. Jussi Hirvonen, Finnish Heat Pump Association SULPU (heat pumps), Mr. Kari Hämekoski, Electrowatt-Ekono (green electricity), Mr. Ville Kuittinen, Joensuu university (biogas), Ms. Päivi Laitila, Motiva Oy (information and dissemination), Mr. Pentti Leino, Electrowatt-Ekono (energy prices), Mr. Aleksi Lumijärvi, Electrowatt-Ekono (green electricity), Mr. Tomas Otterström, Electrowatt-Ekono (green electricity), Mr. Esa Peltola, VTT (wind energy), Mr. Mika Pohjola, Electrowatt-Ekono (RES legislation), Mr. Johan Wasberg Arctic OPET (solar energy), and Mr. Pertti Väisänen, Electrowatt-Ekono Oy (biogas). Mrs. Eija Alakangas, VTT, and Ms. Irmeli Mikkonen, Motiva Oy, collected the lists of renewable energy organisations in Finland. Jyväskylä, 2002 5 Contents Abstract..............................................................................................................................4 Preface ...............................................................................................................................5 List of symbols and terms..................................................................................................8 1. Introduction................................................................................................................10 2. National energy policy...............................................................................................11 2.1 Energy economy in Finland..............................................................................11 2.2 Targets of energy policy...................................................................................12 2.3 Measures to implement energy policy..............................................................15 2.3.1 Research and development .........................................................................15 2.3.2 Energy taxation...........................................................................................16 2.3.3 Investment grants........................................................................................18 2.3.4 Support for forestry and agriculture sector .................................................19 2.3.5 Information dissemination and training......................................................20 3. Renewable energy sources in the Finnish energy markets ........................................22 3.1 Bioenergy – significant renewable energy source in Finland ..........................22 3.1.1 Use of renewable energy sources................................................................22 3.1.2 Wood fuels..................................................................................................24 3.1.3 Agricultural biomass...................................................................................26 3.1.4 Waste to energy ..........................................................................................28 3.2 Electricity markets in Finland ..........................................................................30 3.3 Use of renewable energy sources in electricity production..............................33 3.3.1 Biomass in electricity production ...............................................................33 3.3.2 Hydropower ................................................................................................36 3.3.3 Wind power ................................................................................................37 3.3.4 Green electricity and green certificates in Finland .....................................39 6 3.4 Heat markets in Finland....................................................................................40 3.4.1 District heating............................................................................................41 3.4.2 Use of wood fuels in space heating ............................................................43 3.4.3 Heat pumps .................................................................................................43 3.4.4 Solar heat and power...................................................................................44 4. Summary....................................................................................................................47 References .......................................................................................................................48 APPENDICES App. A. List of renewable energy organisations in Finland App. B. Legislative references App. C. Use of wood in Finland in 2000 App. D. Competitiveness and costs of biofuels in Finland. App. E. Wind turbines in Finland in 2002. 7 List of symbols and terms Gigajoule (GJ) Megawatt hour (MWh) 1 m3 solid 1 m3 loose Unit referring to heat, 1 TJ= 1 000 GJ 1 PJ=1 000 TJ Unit referring to electricity, 1 MWh=3.6 GJ, 1 TWh= 1000 GWh unit referring to wood as solid cubic meter, » 7.2 GJ, » 2.5 m3 loose unit referring to wood as loose cubic meter » 2.5–3.2 GJ Bioenergy Bioenergy refers to energy derived from biofuel /41/. Biomass Refers to the biodegradable fraction of products, waste and residues from agriculture (including vegetal and animal substances) and forestry and related industries, as well as the biodegradable fraction of industrial and municipal waste /13/. Biofuel (=biomass fuel) Fuel produced directly or indirectly from biomass. The fuel may have undergone mechanical, chemical or biological processing or conversion or it may have had a previous use. Biofuel refers to solid, gaseous and liquid biomass-derived fuels /41/. Black liquor Alkaline spent liquor obtained from digesters in the production of sulphate or soda pulp during the process of paper production, in which the energy content mainly originates from the content of lignin removed from the wood in the pulping process /41/. CHP Combined Heat and Power (CHP) or cogeneration is defined as an energy conversion process, in which electricity and useful heat are produced simultaneously in one process. CHP is generated by several types of CHP plants, such as conventional backpressure power plants, extraction condensing power plants, gas turbine heat recovery boiler plants, combined cycle power plants and reciprocating engine power plants /5/. Green certificate system (GC) Electricity from renewable energy sources is divided into two different products that can be sold separately. Firstly, a supplier of electricity from renewable energy sources is able to sell this electricity on the normal electricity market. Secondly, the supplier can sell the green certificates – or “embedded characteristics” – on the green certificate market /33/. Green electricity Electricity produced by environmentally sound meathods. Green electricity often refers to electricity from renewable energy sources. Electricity from combined heat and power (CHP) production is also usually regarded as green electricity /33/ Firewood Cut and split oven-ready fuel wood used in household wood burning appliances like stoves, fireplaces and central heating systems. Firewood usually has a uniform length, typically in the range of 150 mm to 500 mm /41/. Forest fuel Wood fuel, in which the raw material has not previously had another use. Forest fuel is taken from the forest and processed directly for energy use. Forest fuels can be fuels from logging and thinnings /41/. Forest residues Woody residues consisting of branches, tree tops, brushwood and small trees not harvested or removed from logging sites in commercial wood stands, as well as material resulting from forest management operations /41/. Fuel wood; energy wood Wood fuel, in which the original composition of wood is preserved /41/. 8 Logging residues Woody biomass residues created during harvest of merchantable timber. Logging residues include tree tops with branches and can be salvaged fresh or after seasoning /41/. Log wood Cut fuel wood, in which most of the material has a length of 500 mm or more /41/. Peat Peat is a material formed by decomposition of dead plant parts under very moist conditions. Peat material is thus of biological origin. It is continuously formed in wetlands and decomposed in varying degrees by biological and chemical processes with limited oxygen access. Peat is a local, indigenous, solid fuel, which is used as milled or sod peat /23/. Pellet Fuel in the form of short cylindrical or spherical units. Fuel pellets are usually produced from cutter shavings, dried sawdust and powder. Pellets are usually 8 - 12 mm in diameter and 10 - 30 mm in length, with moisture content of less than 10% /23, 41/. Pyrolysis oil Liquid biofuel, which is produced in flash pyrolysis by heating wood (moisture content less than 10%) up to 500 – 600 oC in a very short time. The organic particles are transformed into gas that is then converted to a liquid (oil). Generally, the bio-oil yield is about 70 wt% /23/. Recycled wood fuels Recycled wood fuels include post-society wood fuels like demolition wood, wood casings and other waste wood /23, 39/. Refined fuel Biofuel that has been treated mechanically or chemically to homogenise its properties. E.g., pellets, briquettes and pyrolysis oil are refined fuels /23, 41/. Renewable energy sources (RES) Refers to renewable non-fossil sources (wind, solar, geothermal, wave, tidal, hydropower, biomass, landfill gas, sewage treatment plant gas and biogas) /13/. Sawdust Fine particles created when sawing wood. Most of the material has a typical particle length of 1 to 5 mm /41/. Solid recovered fuel (SRF), recovered fuel (REF) Fuels made of pre-sorted municipal, industrial and construction and demolition waste, excluding industrial waste utilised by industry itself in energy production /38, 18/. Wood chips Chipped woody biomass in the form of pieces with a defined particle size produced by mechanical treatment with sharp tools such as knives. Wood chips have a subrectangular shape with a typical length of 5 to 50 mm and a low thickness compared to other dimensions /41/. Wood fuels, wood based fuels, wood-derived biofuels All types of biofuels originating directly or indirectly from woody biomass /41/. Wood processing industry residues Woody biomass residues originating from the wood processing as well as the pulp and paper industry, like bark, cork residues, cross-cut ends, edgings, fibre board residues, grinding dust, particle board residues, plywood residues, saw dust, slabs, and wood shavings /41/. Wood shavings; cutter shavings Shavings from woody biomass created when planing wood /41/. Woody biomass Biomass from trees, bushes and shrubs. Forest wood, wood processing industry residues, fibre board residues, particle board residues, plywood residues, and used wood are woody biomass /41/. 9 1. Introduction Finland is located in northern Europe. Almost its entire national territory is located between 60 and 70 degrees northern latitude, and a quarter of its surface area lies north of the Arctic Circle. One third of all people living north of the 60th parallel are Finns. The mean annual temperature in Southern Finland is 4 to 5 oC, in Lapland –2 to +3 oC. In January, the mean annual temperature in the northern two thirds of the country is –10 and –15 oC, in southern Finland it is –5 to –10 oC. Even in southern Finland, 30% of the annual precipitation stems from snow, which remains on the ground for about four months. In the winter season, there is a very limited amount of full daylight, necessitating electric lighting until late morning and as of early afternoon. The growth season is four months long. Correspondingly, the population-weighted average number of heating degree days for Finland is 5 000, much higher than the figure for Sweden and Norway (4 000). Thus, Finland has the coldest climate in Europe /9/. Finland is large and sparsely populated: with 338 145 km2, it is the fifth largest country in Europe and has a population of 5.2 million, i.e. 17 people per square kilometre. More than two thirds of Finns live in urban areas; only 1.6% north of the Arctic Circle. More than three-quarters (68%) of the country is covered by boreal coniferous forests, and 10% by lakes and other water systems; only 9% is cultivated area. Productive forestland is the most valuable natural resource of Finland. The only indigenous energy resources in the country are hydropower, wood, peat and wind energy. The forest and paper, metal and engineering and chemical industries represent about 80% of Finland’s industrial production. These industries are very energy-intensive, and the forest and paper industry alone accounts for 63% of industrial energy consumption /9/. Finland has one of the highest energy intensities in the EU, both per capita (6.03 toe/capita) and per unit of GDP. In 2000, GDP totalled 175 € billion, i.e., 25 337 €/capita, of which services (other industry) 62.1%, secondary production 34.2% and primary production 3.7% /57/. Finland’s general aim is to divert away from the export of primary products towards more high-tech, high-value added exports. At present, the value of energy technology exports amounts to some € 3 billion. Successful domestic export products include equipment used in energy use, such as frequency converters and electric motors and electric motors as well as products representing power production technology such as diesel motors and steam boilers. Exports of wind power technology have also grown swiftly /6, 33/. 10 2. National energy policy 2.1 Energy economy in Finland One of the strengths of Finland’s energy economy is the variety of the production structure. Increasing the use of renewable energy sources is an explicit goal of the Finnish energy strategy. Renewable energy sources are important both in limiting carbon dioxide emissions and for ensuring the security of Finnish energy supply. Moreover, utilisation of renewable energy sources especially bioenergy has positive effects on employment on the local level. In 2000, renewable energy sources accounted for about 25% of all energy consumption in Finland (Fig. 1). The percentage of wood energy was more than 20%, the rest of the renewables being mostly hydropower (Fig. 7). The share of renewables in energy consumption in Finland is the third highest percentage in the EU, and as regards bioenergy, the highest one /3, 17/. Coal 11.4% Oil 26.8 % Natural gas 10.7 % Hydro power 3.9 % Wood fuels total 20.5 % Nuclear power 17.9% Black liquors 10.9% Ind. wood residues 6.2% fire wood 3.4% Heat pumps 0.2% REF 0.2 % Others 0.5 % Net imports of electricity 3.2 % Peat 4.7 % Wind energy 0.021 % Figure 1. Primary energy sources in Finland in 2000 (1 318 PJ) /17/. In Finland, the world’s most northern industrialized nation, energy consumption per capita is high. This is due to the severe climate, long distances, the high standard of living and the structure of the industry. Industry consumes about half of all energy, the bulk of which is used by the forest industry. Transport and space heating consume about one fifth each. The final share includes domestic, agriculture, and construction business (Fig.2) /14/. 11 Other 15 % Industry 52 % Transportation 14 % Space heating 19 % Figure 2. Total energy consumption by sector in 2000 (1 318 PJ)/17/. 2.2 Targets of energy policy The National Climate Strategy, launched by the Finnish Government in 2001, highlights the targets and measures to meet the Kyoto commitments in Finland. Annual emissions during 2008 and 2012 should not exceed those in 1990, when they were equivalent to around 76.5 million tons of carbon dioxide. In order to meet the climate change targets, it is necessary to implement an energy conservation programme and a programme for promoting renewable energy sources (reduction by RES 4 – 5 million CO2 tons). Together these two programmes may account for about half of the targeted emission reduction (Fig. 3). /1, 21, 33, 53/. The Finnish Action Plan for Renewable Energy Sources was launched in 1999 and is to be revised by a working group in end of the year 2002. It has the vision of doubling utilisation of renewable energy sources by 2025, as compared to the situation in 1995. By 2010, the use of renewable energy sources should be 50% higher than in the reference year 1995. Their proportion will be roughly 30% of the total consumption. For reaching the targets, wood-based fuels and recycled fuels play a leading role in Finland. The increase in use of renewable energy sources will be obtained almost entirely from bioenergy /1, 2/. 12 100 Mt CO 2 -ekv. All greenhouse gases 80 60 Energy saving + Increased used of renewables + Other incentives in reduction of greenhouse gases Greenhouse gas from coal and peat burning Incentives in reduction of greenhouse gases by coal /natural gas / nuclear energy 40 20 Statistics Emissions 1990 0 1980 1985 1990 1995 2000 2005 2010 2015 Figure 3. Targeted emission reduction in Finland and role of renewable energy sources and energy conservation /33/. The total target of renewable energy use by the year 2010 has been increased by a third, i.e., by 100 PJ compared to that in 2001. Compared to the present programme, the use of renewable energy in 2010 would be more than 7% higher. The target for the year 2025 includes an increase of 2/3 compared to the present use of renewable energy /1/. Development in the volume of spent liquors from wood-processing industries and of wood fuels is not directly included in the Action Plan, as the volumes are dependent on the production and production structure of forest industries. Hence, the development assessments of their use are based on the development defined in the basic scenario of the Ministry of Trade and Industry. Measures are neither focused on large-scale hydropower (> 10 MW) in the new programme, but development estimates are included in the targets of the programme /1/. As regards the production and use of bioenergy, the essential object of the Action Plan, targets have been set separately for small-scale use, forest chips, recovered fuels, biogas and agricultural biomasses. In addition, targets are also proposed for the use of biofuels in transports /1/. The target set for power generation from renewable energy sources has been increased to meet the target of RES-E Directive /13/, according to which the share of electricity generated from renewable energy sources should be 31.5% in 2010. The target (29.3 TWh) has been raised by about 2 TWh. The targets of different modes of electricity generation are in conformity with those of the present programme /1/. 13 Table 1. Targets for renewable energy sources in Finland in 2005, 2010 and vision for 2025 according the proposal of the working group for revised Action Plan for Renewable Energy /1 /. 1995 PJ 209 267 2005 Increase from year 2001,% 305 14 156 8 45 202 16 49 215 30 59 6 88 21 230 44 72 14 175 46 268 61 76 33 4 55 208.6 267.2 304 14 349 31 414 55 109.0 133.7 143 7 154 15 167 25 51.8 43.7 3.1 0.36 0.65 0.00 0.00 76.6 45.8 9.4 1.01 0.75 0.00 0.00 80 50 22 5 2.3 0.9 1.4 4 8 133 5 times 3 times 84 54 38 10 4.2 2.1 3.1 9 19 4 times 10 times 6 times 92 59 63 10 8 5 9 20 28 7 times 10 times 11 times 46.0 41.8 4.2 0.04 46.9 42.8 4.1 0.25 49 44 6 1.2 5 2 39 5 times 52 45 8 4.0 58 46 11 17 SOLAR ENERGY 0.013 0.021 0.16 8 times 0.33 PV 0.004 0.008 0.08 10 times 0.17 12 4 88 16 times 16 times 20 times Solar heat 0.008 0.013 0.08 6 times 0.17 147 16 23 8 175 70 times 200 times 200 times 6 times 1.84 2.73 4 55 7 147 16 6 times BIOENERGY BY SECTORS Industry District heating Firewood (households) Transport BIOENERGY TOTAL BY FUELS Spent liquors from forest industry1 Industrial wood residues Firewood (excl. forest chips) Forest chips REF2 Biogas Agrobiomass Liquid biofuels (for transport sector) 3 HYDROPOWER of which >10 MW4 of which < 10 MW WIND POWER HEAT PUMPS 2001 PJ PJ 2010 Increase from year 2001,% 349 31 PJ 2025 Increase from year 2001,% 414 55 PJ 3.3 1.7 TOTAL 256 317 359 13 412 30 508 60 1 not included in the Action Plan, estimation of the Finnish Ministry of Trade and Industry 2 Number includes only a biodegradable share of recovered fuels, which is estimated to be about 60%. Demolition and construction wood is not included in REF. They are part of the industrial wood residues. Numbers are not targets, only estimations of the energy recovery that waste management targets will achieved. 3 Preliminary target, which will be specified later. 4 New investments to large scale hydro are not included in the Action Plan, estimation of the electricity producers. 1 PJ = 0.13 million m3 solid for wood The Energy Conservation Programme was first launched in 1992 and revised and intensified in 1995 and 2000. The revision of 2000 was made as a part of preparing the National Climate Strategy. The Energy Conservation Programme is being updated in December 2002. The key elements of the programme are development and commercialtion of energy efficient technology, economic means of steering, building 14 regulations and other statutes, development of voluntary energy conservation agrements and energy audits as well as information, training and motivating activities. The Ministry of Trade and Industry monitors the implementation of the programme and reports the development as a part of monitoring and reporting of the National Climate Strategy. 2.3 Measures to implement energy policy Implementation of the Climate Change Strategy calls for financial support measures /31/. Technology R&D and implementation of new technologies are the main measures in aiming to economically competitive solutions for the open energy market. Also, taxation, investment aids, regulations and norms support the fulfilment of the target. In addition, the administrative barriers to the use of renewable energy will be removed, voluntary agreement schemes introduced, and information dissemination and the efficiency of education and training improved /33/. 2.3.1 Research and development The competitiveness of renewable energy sources will be promoted through investment in long-term technology research and development. The thresholds hampering the getting of the R&D findings and results onto the market will be lowered by supporting projects aimed at the commercialising of new technologies /6, 33/. The National Technology Agency Tekes is the main public financer of the technology R&D. Renewable energy technologies, belonging to the sustainable development solutions, are in the strategic focus of Tekes. Various national technology programmes and projects have involved RES technologies, the main focus being in bioenergy. Tekes funding for the renewable energy R&D amounts to € 10 million annually. The ongoing technology programmes in 2002 involved with RES are the Wood energy, Waste management and recycling, Fine particles – technology, environment and health, Modelling tools of combustion process development and Technology and Climate change /58, 59/. Research on renewable energy sources is carried out by governmental contract research centre, VTT and several universities in Finland (App. A). VTT Processes has established in 2002 a special service on Renewable Energy Sources, VTT Renewables portal. VTT Renewables offers a gateway with 140 experts to all R&D services of bioenergy, REF and wind technologies and market opportunities. 15 2.3.2 Energy taxation Taxation is one of the main instruments related to climate change and environmental policy in Nordic countries. Finland was the first to impose a carbon-based environment tax in 1990 by introducing a CO2 tax on fossil fuels. In heat generation, solid biofuels like wood fuels, biogas and REF fuels are not taxed. Fossil fuels have tax, which is based on the carbon content of the fuel. In the generation of electricity, i.e., the tax is levied on electricity generated/consumed and not on the fuels used for the generation of electricity. A tax subsidy for electricity production by renewable energy sources was introduced in 1997. Unlike in some other countries, industry in Finland was not entitled to deduct the carbon/energy tax, but has lower electricity tax than private consumers and public sector (Fig. 6) /6/. In CHP the tax was split into two components in combined generation of electricity and heat production. The fuels used for heat generation are calculated by the amount of heat produced. The consumption of heat fuels is calculated by multiplying the heat amount generated by the factor 0.9. The tax paid by the consumer on the electricity produced with wood-based fuel and for peat fuelled CHP (<40 MVA) was refunded as subsidy to the producer € 4.2 per MWh. Likewise the support for the producers of wind and smallscale hydro power (<1 MW) and producers of electricity by forest residues is € 6.9 per MWh (Fig. 5 and 6). In heat generation, no tax is levied on wood fuels, biogas and REF. The new CO2 tax as of the year 2003 is € 18.1 per one tonne of CO2 (Fig. 4) /6, 53/. Peat, which in Finland is considered slowly renewable biomass fuel, is taxed at a lower rate (€ 1.5 per MWh, 23%, Figure 5) and if consumption of fuel peat in heat production is less than 25 GWh it is tax-free /53/. Also for natural gas the CO2 tax is lower (50%, Figure 5) than its CO2 factor specifies. 16 EUR/MWh 8 Peat Peat with primary product deduction Coal Natural gas Natural gas with deduction of import fee Heavy fuel oil Light fuel oil 7 6 5 4 Energy tax only fuels used in heat production Light fuel oil Coali Heavy fuel oil 3 Natural gas 2 Peat Peat 1 0 1990 -1 -2 1992 1994 1996 1998 2000 2002 Natural gas with deduction of import fee Peat with primary product deduction Year Figure 4. Development of energy taxes in Finland as of the year 1990 /53/. 8 EUR/MWh 7.08 Precautionary stock fee Basic fee Excise tax 7 6 6.28 5.25 5 4 100 % 3 2 100 % 1,59 1.91 50 % 23 % 1 0 100 % 0 Peat Wood Heavy fuel oil Light fuel oil Natural gas Coal Figure 5. Energy taxes in 2003. Electrowatt-Ekono and MTI /53/. Peat (23%) and natural gas (50%) have lower CO2 taxation rate than based on their CO2 factor specifies. 17 WIND POWER No excise taxes HYDRO POWER MULTIFUEL CHP Excise tax for "heat" fuels < 1 MW Wood Wood 0 EUR/MWh Coal 6.28 EUR/MWh Peat* 1.59EUR/MWh Natural gas 1.91 EUR/MWh Heavy fuel oil 5.25 EUR/MWh No excise taxes Coal Peat Natural gas Heavy fuel oil No taxes for "electricity fuels" Electricity production support 6.9 EUR/MWh * if consumption is >25 GWh ** if electricity production by renewable energy sources is >100 MWh Application within 6 months ** Electricity production support 4.2 EUR/MWh LOCAL CUSTOMS HOUSE Heat Electricity Application within 6 months ** Electricity production support 6.9 EUR/MWh for forest chips and 4.2 EUR/MWh for other wood and REF Figure 6. Examples of implementing energy taxation in different type of plants. /6/. 2.3.3 Investment grants Subsidies granted for energy investments, development projects and energy conservation constitute an important means of implementing the National Energy and Climate Change Strategy. A particularly important function of the subsidies is to promote use of renewable energy sources, and to reduce the environmental impacts arising from energy generation and use /6, 21/. The Council of State’s new decision (625/2002, App. B) sets the following maximum percentages for the assistance granted to different types of renewable energy projects /6, 47/: · Wind and solar energy investments, 40% · Other investments in renewable energy, conventional technology (renovation and modernisation projects) 25 – 30% and for innovative projects 40% · Energy conservation auditing and other assessment studies, 40% Projects involving innovative technology have the priority, when energy support is granted. Investment grant is allotted for companies and communities, not for private 18 persons or state organisations /3, 6/. In 2000, in total € 19.5 million was available for energy supports /6, 53, 1/. In 2002 support will be about € 29 million /1/. The Ministry of Trade and Industry supports energy audits and analyses of the companies that have acceded to a voluntary energy conservation agreement as well as the energy conservation investments observed in an audit. The voluntary agreements are gradually expanded to cover climate issues as well. The first new energy conservation and climate agreement was signed in public sector in October 2002. Renewable energy sources are being integrated into energy audits in 2003. 2.3.4 Support for forestry and agriculture sector In the Act of Financing Sustainable Forestry, non-industrial, private forest owners are entitled to seek governmental grants for the afforestation of understocked areas, for prescribed burning, for tending of young stands, for harvesting of energy wood, for forest recovery, fertilisation etc. Loans can be granted for joint ventures involving improvement ditching and forest road construction /6, 7, App. B/. In October of 1997, Ministry of Agriculture and Forestry (MAF) launched a Campaign promoting the tending of young stands from 1998 to 2003. MAF has proposed in state budget annually € 20 million for years 1998 – 2003. The state is supporting about 50 – 70% of the harvesting costs of thinnings from young stands /6, 7/. From year 1997 to year 2000 in total 444 754 hectares were in the campaign. In year 2000, the total public support for young stands amounted to € 25 million, of which harvesting of energy wood accounted for € 1.8 million. The support to forest owners for forestry operations ranges 126.5 – 294.7 €/ha when employing outside harvesting services, and 84.5 – 189.0 €/ha for own work, and for wood fuel harvesting (3.5 €/m3 solid) and forest transportation (3.5 €/m3 solid), the total support being 7 €/m3 solid (about 3.5 €/MWh). In 1999 subsidisation of harvesting and use of fuel wood was improved. In the end of year 1999 a new support scheme was introduced by the MAF to cover also the chipping costs. This “chipping support“ (1.7 €/loose m3, about 2 €/MWh) is paid for chips produced from trees harvested from young stands and to the organisation or the farmer delivering the chips to the plant. This support has been about € 0.3 million in year 2000 /6, 7, 56/. The Finnish Ministry of Agriculture and Forestry finances development projects that promote the use of wood energy and gives investment, start-up and development 19 support to enterprises, part-financed by EU (EMOTR) through the Regional Rural Development Programme (ALMA), Objective 1 Programmes and to some extent also Leader+ Programme. The aim of financing is to put in order the whole energy production chain from the forest to the production plant. Primary beneficiaries of these projects are farm enterprises and so-called chain enterprises co-operating with farms (employment not more than 5 person-years) /1/. During the present EU financing period 2000 – 2006, in total € 35 million has been granted for different development projects. The support granted to energy enterprisers, mainly as investment aid, amounted to about € 9 million and that granted to farm heating stations amounted to about € 15 million. The supports granted from national funds for heating station investments of farms has been on average € 5.3 million/a /1, 56/. 2.3.5 Information dissemination and training Information, education and motivation hold the key position especially to effect on attitudes. It is easier to carry out other promotion measures if they are supported by information activities and guidance /1/. The Finnish Ministry of Trade and Industry has channelled the main part of funds to energy information through Motiva Oy. The financing by Motiva in 2002 amounted to about € 2.4 million, of which about a fourth is used for promoting the use of renewable energy sources. In addition, Motiva has co-ordinated the implementation of two separate operations concerning bioenergy information under the Action Plan for Renewable Energy Sources, the total financing being about € 165 000. Promoting of heat entrepreneur activities and pellet heating have been crucial sub-fields of these projects. Furthermore, promotion campaigns and single information projects have been carried out. An information action on renewables other than bioenergy was also prepared for implementation in late 2002 /1/. The Ministry of Trade and Industry also finances a two-year (2002 – 2003) project on networking energy agencies through Motiva. The network of energy agencies will promote the use of renewable energy sources regionally and locally. The activity in the bioenergy sector focuses on the use of chips, on heat entrepreneur actions, and on pellet heating. The agencies also participate actively on wind power surveys in their regions and on promoting solar heating systems. Information on successful experiences is disseminated to the regions of other acengies /1/. 20 Finland has also trained advisors on wood energy. These advisors are working, i.a., in all forest centres by project funding. The Ministry of Agriculture and Forestry will require in the result agreements of forest centres for the year 2003 that the activities of energy advisors shall be continued. The operation of the network has been encouraged, i.a., by organising theme days and by producing a service package for Internet /1/. A national technology and climate change programme (Climtech), governed by the National Technology Agency Tekes, focuses on disseminating technology data related to combating climate change. Surveys concerning renewable energy sources have been published during the programme, and brochures will be published on results /1/. As a part of the Organisations for the Promotion of Energy Technologies OPET, included in the Framework Programme of EU, the OPET Finland Consortium (Tekes, Motiva and VTT Processes) has concentrated on wood energy. Examples of successful projects and reports, i.a., on market actors and technologies have been published both in Finnish and English. A number of seminars, especially on pellets and small-scale use of wood, have been organised in Finland, and study tours abroad and to Finland have been arranged. The main part of information material was published in Internet /1/. The Ministry of Education has nominated a committee on training in energy field for the period of 1 February 2001 – 31 January 2004 for operating as a specialist organ in the development of vocational basic and advanced training for young and adult people, and of training and education at polytechnics and universities. The committee has initiated a project on surveying the training needs and development in the energy field with the aim of integrating the topics of renewable energy sources and energy saving to training and education programmes /1/. RES training is given as a part of energy technology studies in technical universities or institutes or in universities with forestry (see App. A). For example the Polytechnics of North Carelia, Jyväskylä and Satakunta offer training courses with specialisation in bioenergy. Information on RES is also disseminated by different associations and research organisations (listed in App. A). Information material of RES and energy conservation has been produced also in ALTENER and SAVE projects. 21 3. Renewable energy sources in the Finnish energy markets 3.1 Bioenergy – significant renewable energy source in Finland 3.1.1 Use of renewable energy sources Wind 0 % 276 TJ Solar energy 0 % 9 TJ TJ 16.7% Hydro power 16 % 46 865 TJ REF 1 180 TJ Biogas 857 TJ Heat pumps 2 140 Firewood 45 300 30.4% Bark 45 882 Sawdust etc. 17 914 Forest chips, ind. 5 451 Ind. Wood residues 4 511 Demolition wood 1 080 Pellets and briquettes 353 Not specified 6 959 53.0% Black liquor Wood 84 % 270 997 TJ 143 541 RES in total 327.5 PJ 25 % total primary energy Figure 7. Use of renewable energy sources in Finland in 2000 /17/. Bioenergy is the most important renewable energy source in Finland, accounting for 85% of renewable energy sources. In Finland, the main provider and user of woodbased energy is the forest industry, which obtains wood fuels at a competitive price in connection with raw material procurement or as a by-product of wood processing. About 35 million m3 solid of wood (271 PJ) is used annually for energy production in Finland, covering 20% of the total consumption of primary energy. Most of wood-based energy is recovered from liquid and solid industrial wood residues. So far a modest – but fast growing - share comes from forest fuels (Fig. 7 and App. C) /11, 23, 59, 60, 62, 63/. The availability of different biomass resources is estimated in 15 areas of Finland for six types of biomass-based fuels that have different cost levels. Two different scenarios were created. The Basic Scenario introduces the situation with continuation of the present policy including promotion activities of RES (Fig. 8). The Maximum Scenario is connected with the improvement of competitiveness of bioenergy that could allow a cost increase of 50% on fuel compared to the present situation (Fig 9.). The availability 22 of peat is also introduced, because it can smooth variations in the availability and quality of biomass based fuels /28/. 300 250 Peat Agrobiomass 200 PJ/a REF First thinnings 150 Final fellings (pine) 100 Final fellings (spruce) Industrial by-products 50 Need for domestic fuels Possibilities of wood 0 1999 2005 2010 2025 Figure 8. Availability of wood and peat fuels by employing conventional technology and based excluding black liquor and firewood on Basic Scenario /28/. 300 Peat 250 Agrobiomass REF 200 PJ/a First thinnings 150 Final fellings (pine) Final fellings (spruce) 100 Industrial by-products Need for domestic fuels 50 Possibilities of wood usage 0 1999 2005 2010 2025 Figure 9. Availability of wood and peat fuels by employing conventional technology and based excluding black liquor and firewood on Maximum Scenario /28/. Biomass resources are not located evenly geographically. Residues from the forest industry are naturally adjacent to mills, harvesting residues to forests and their logging operations, agrobiomass to the fields and waste to urban areas. Another important factor 23 is the close distance between biomass resources and heat demands, such as district heating networks and industry /28/. Import and export possibilities are most viable in the coastal areas of Finland. The market volumes have so far been rather limited, less than 1 TWh annually, but are increasing. Especially refined fuels, such as pellets, allow longer transportation distances and long-term storage. About 80% of pellet production is exported to Sweden, Denmark and other European countries. Wood chips are imported by trucks from Russia, where cheap return transportations have been utilised /28/. 3.1.2 Wood fuels The Finnish Forest Research Institute (METLA) has studied the sufficiency of Finland's wood resources. Finland’s forestry land area is 23 million ha, i.e., 86% of Finland’s total area. Private persons own more than 70% of the Finnish forests. The total growing stock is estimated at 2002 million m3 solid, and the annual growth of the above-ground forest biomass at about 130 million m3 solid per annum. When harvesting raw material, about 29 million m3 of forest residues is left in the forests. The annual harvestable potential of forest residues is estimated at about 10 – 16 million m3 solid. Currently, the annual total use of solid wood fuel amounts to 13 – 15 million m3 solid, of which the use of forest residues is 1.3 million m3 solid. National Forest Programme has set an aim to increase the annual use of wood for energy production by 5 million m3 solid by year 2010, which is also the target in the Action Plan /2, 3, 19, 22, 24, 55, 62, 63/. A forest certification system has been established in Finland. It is known as the FFCS (Finnish Forest Certification System). FFCS certification indicates impartially and reliably that Finland's forests and forest ecosystems are being sustainably managed. 22 million hectares of forests certified in Finland until March 2002. The Finnish system includes requirements for forest management, wood chain of custody certification, and external auditing. These requirements are set out in standards /7, 62, 63/. In Finland, the bioenergy markets are mostly local. There are few diversified companies, which operate on national level like Biowatti Oy and Vapo Oy. Some forest industry companies like UPM Kymmene are also supplying wood fuels through their forest departments. These companies work on energy, wood processing and also biofuels business. They can exploit industrial wood residues from their own mills for production of wood chips or pellets. They can integrate harvesting of logging residues into timber or pulp wood harvesting and in this way keep fuel prices competitive. The most important of these are listed in App. A. The price of wood fuels has decreased as of 1980s until year 2000, when the average price for forest chips was 2.5 €/GJ. In 2001 and 2002, the price has increased due to limited availability of the woody biomass in 24 certain areas of Finland (App. D). At the same time, a lot of new CHP capacity based on biomass has also been built (Table 3). Pohjolan Voima Oy has currently invested about € 620 million to new biomass CHP plants in Finland. These plants produce 559 MWe electricity and 1038 MWth heat for pulp and paper mills /11/. In small-scale heating of municipal buildings like schools and small district heating plants, a heating entrepreneurship model has been used in fuel procurement and also in the operation and maintenance of the boiler plants. Usually plants are invested by municipalities or industry and there are renovated from oil to wood fuels. The heating entrepreneur is a single entrepreneur, co-operative, limited company, or entrepreneur consortia, who sells heat. Usually these entrepreneurs are farmers and harvest smallsized wood on their own woodlots or purchase industrial wood chips or cutter shavings from local wood processing industry. The number of these entrepreneurs in Finland has increased to 135 using annually about 200 000 – 250 000 m3 loose wood chips /4, 11/. In large-scale wood fuel procurement, different kinds of modern information technology, like mobile phones and Internet are used for, e.g., positioning fuel storages and logging sites or for ordering chippers or alarming boiler plants malfunctions. Several electronic firewood market places (e-trade) have also been established in Internet for local, national and even international consumers to select log or pellet suppliers /11/. Wood pellet market is fairly young in Finland. The first wood pellet plant was commissioned as late as 1998, and at first nearly the whole production was exported to Sweden. Penetration of pellets in the Finnish heating market did not start properly until in 2000 due to the low price of oil /10/. The annual pellet production capacity is about 200 000 tons in 2002 in Finland, while the pellet production in 2002 will amount to about 110 000 tons, of which only 10 – 20% will be used in Finland. The rest will be exported to big power plants in Sweden, Denmark and the Netherlands. Growth in pellet use in Finland is one of the highest in Europe /10/. There is an abundance of raw material in Finland. By-products of mechanical woodprocessing industry amount to 13 PJ. According to Vapo Oy, it is possible to produce 1 million tons pellets annually from this readily available dry material and the rest from wet raw material. Availability of dry wood material is for production of 200 000 tons pellets /10/. Pyrolysis oil is a new biofuel product ideal as a substitute for fuel oil and future diesel power applications. In Finland, Fortum Oil and Gas, Vapo Oy and VTT have developed pyrolysis oil process concepts for sawdust and forest residue applications. R&D started 25 in 1980´s and the first pilot plant started production of pyrolysis oil in late 2001, and the commercial-size production plant should be completed in 2004. The aim of research is to improve the heating value of pyrolysis oil (16 – 18 MJ/kg), being at the moment only half that of petroleum products, and making pyrolysis oil miscible with petroleum products. The liquid contains varying quantities of water (15 – 40 wt%), depending on how it was produced and subsequently. Recent years have seen significant improvements in production quality and stability /23/. The quality assurance guidelines for solid wood fuels (wood chips, bark and sawdust) were developed in 1998 in co-operation with fuel producers and users, and are now used by major traders. In 2002, FINBIO has published quality guidelines for wood pellet for trial use. Finland is also actively participating in the CEN solid biofuel standardization work (TC335) /20/. 3.1.3 Agricultural biomass The total area of agricultural land in Finland is 2 million hectares. It is estimated that maximum 0.5 million ha of Finnish agricultural land will be set-aside from conventional farming over the next few years. This offers potential for alternative land use, e.g., for non-food production. In 2000 the set-aside area was 180 000 ha. Non-food production was carried on about 860 ha in 2000, mainly turnip rape being cultivated for lubrication oil /3, 56/. Figure 10. Reed canary grass (Phalaris Arundinacea). Source: Vapo Oy. 26 The greatest interest at present is in reed canary grass, which is perennial and renewable grass. Finnish Agricultural Research Centre and VTT are studying reed canary grass cultivation in peat sites. Studies have shown that reed canary grass provides a better yield than any other grass grown for energy purposes (6-8 tons dry matter per hectare). In 2000, reed canary grass (Phalaris Arundinacea) was cultivated on an area of about 2 000 ha (Fig. 10). Most of the yield was used in seed production, and about 500 ha have produced biomass for combustion (40 TJ). The target is to use reed canary grass in heating plants in a multifuel boiler in conjunction with peat and wood fuels, as shredded reed canary grass alone is too light. There are already dozens of heating plants in Finland with combustion technique suitable for burning reed canary grass. Vapo has also plans to use reed canary grass as a raw material for pellets /56/. According to FINBIO the annual use of straw is about 6 000 tons (70 TJ). The theoretical annual potential of cereal straw is about 1.8 million tons. About 10 – 20% of this potential could be used as energy (6 PJ). The expert group of FINBIO has estimated that about 9 PJ solid agro-biomass could be used in year 2010 (Table 2). Target of the Action Plan for Renewable Energy is 2.1 PJ /1/ (Table 1). Table 2. Targets for agricultural energy crops by the expert group of FINBIO and Action Plan for Renewable Energy. Source: FINBIO and /1/. Energy crops Agrobiomass in Action Plan /1/ FINBIO Reed canary grass - energy use - total area FINBIO Straw - energy use - total area Current use 0.0 TJ 2003 2004 2005 2006 40 TJ 500 ha 280 TJ 3 000 ha 790 TJ 8 000 ha 1 470 TJ 15 000 ha 2 450 TJ 25 000 ha 7 300 75 000 ha 70TJ 72 TJ 3 000 ha 210 TJ 8 000 ha 430 TJ 15 000 ha 720 TJ 25 000 ha 1 760 TJ 60 000 ha 900 TJ 27 2010 2 100 TJ 3.1.4 Waste to energy PRELIMINARY SORTING AT SOURCE Glassware, Waste aluminium- Biopaper and tin cans waste Combustible Hazardous and miscellawaste neous waste Biogas Recycling Recycling Hazardous waste treatment Composting Biowaste Compost products Recovered fuel (REF) Waste processing Heat Electricity CHP plant Ashes Landfill Non-combustible residual waste Metals for recycling Figure 11. The Finnish waste treatment system based on source separation /18/. In Finland, the waste management is based on source separation of waste in order to produce raw materials for material recycling, and for the production of recovered fuels (REF) for energy production (Fig. 11). Local authorities decide on sorting/collecting systems for source separation, and hence, the systems differ a lot in different areas of Finland. Paper and biowaste are today nearly always source-separated at households in Finland. Other fractions like glass, scrap metals, board, etc., are source-separated in different bins at households or in kerbside collection. Companies must recycle/sourceseparate different fractions, depending on the amount of waste produced. Usually the companies producing, e.g., over 20 or 50 kg/week paper, board, glass, scrap metal, and biowaste must source-separate these fractions. The dry source-separated fraction from households and companies is processed to fuel in a REF plant. The process usually comprises preliminary crushing, when larger items are also removed, magnetic separators, screening, secondary crushing and normally, second magnetic separator and an eddy current for non-magnetic metal. Today five REF processing plants are in operation for processing household waste to REF fuels, two – four processing plants for commercial waste (mostly waste from small industries and supermarkets) and one processing plant for construction and demolition waste. The governmental aim is 70% recovery of waste by 2005 (Waste Management Plan to 2005) /18, 31, 40/. 28 In Finland, the waste-to-energy concepts are based on cofiring of recovered fuels (processed from source-separated waste, quality controlled) in existing CHP plants. The total amount of combustible waste is 3 – 5 million t/a. Today, 300 000 t/a of dry, commercial packaging waste-based solid recovery fuels (SRF) is co-combusted in Finland. This is about 1% of the primary energy use. The potential of REF is estimated to be 1 million tons REF(17 – 21 PJ/a). There are only one mass-burn incinerator in Finland in Turku with a waste burning capacity of 50 000 t (15 MW district heat). One unit, Ewapower Company in Pietarsaari, produces pellets from RDF (5 000 t/a). Today, REF and pulp and paper mill sludges are cocombusted in Finland. Usually less than 10% REF mixed with peat, bark, sawdust, etc., is co-combusted in about 40 fluidised boilers and also in one gasification plant in Lahti. When the new EU Directive on waste incineration /12/ comes into force, many of these usually small waste to energy plants must reconsider the use of REF due to the investments needed for flue gas cleaning and measurement costs. About 20 new or retrofitted waste to energy plants are needed in order to reach 1 million tons use of SRF volume and 70% MSW recovery rate /40/. Reliable operation of boilers requires REF with a low content of noxious constitutes and impurities, efficient source-separation and an appropriate production process. These requirements also support the recycling of materials. Finland published a standard for solid recycled fuels, Quality Control System - SFS 5875 in late 1999. This standard defines the procedure and requirements, by which the quality of recovered fuel, produced for energy production from source-separated waste, can be controlled and reported unambiguously /39, 46/. Currently about 150 landfills are in operation and this number will reduce to 50 – 80 by 2005. The first Finnish biogas plant was built in 1986 for research purposes at the Vuosaari landfill site in Helsinki. There is a decision of Council of the State from year 1997 (861) that landfill gas should be collected for use from landfills. This encourages also the energy use of landfill gas /30, 52/. In Finland, altogether 15 biogas were in operation at different municipal wastewater treatment plants and 13 landfill gas plants since 2000. There are 39 reactors at the biogas plants and the total volume of anaerobic digesters is about 117 000 m3. In 2000 there were five biogas plants operating at private farms, and in 2001 a new type of biogas plant for farm slaughter wastes was constructed. In 2000, the output from landfill gas plants was 45 MW, 1.3 MW being electricity, 17.3 MW heat and 28.5 MW flare combustion. The total potential is estimated to be about 100 MW (200 million m3 of biogas) /30, 52/. 29 VTT has estimated that the economical biogas potential is 8 – 13 PJ, and the electricity potential is estimated at 65 – 105 GWh/a /40/. The University of Joensuu has estimated that the theoretical potential of biogas is 1 300 million m3 for energy use. At present about 70 million m3 of biogas is collected and about 720 TJ energy produced (Fig. 12). In the Action Plan for Renewable Energy the target for biogas in 2010 is 4.2 PJ /1, 30/. 80 60 Landfill gas Other reactors Waste water treatment plants 40 20 0,0 1997 1998 1999 2000 Figure 12. Biogas production in Finland 1987 – 2000. Source: Electrowatt-Ekono. 3.2 Electricity markets in Finland Finland was the third country in Europe after Britain and Norway to initiate the opening-up of its electricity market to competition. The liberalisation of the electricity market in Finland started in 1995 and was completed in 1998. Through the new Electricity Market Act, all consumers can freely purchase their electricity from the power company of their choice. This new competition environment has given the energy utilities an incentive to establish trademarks and develop brands. Environmental aspects have been one factor in branding of electricity products /8, 15, 32/. Electricity makes up 25% of Finland’s total energy consumption (79.2 TWh), the industry consuming more than half of this amount. Finland’s total domestic electricity production amounted to 67.3 TWh in 2000 (Fig. 13). Of this amount, some 23.5 TWh was electricity from renewable energy sources and 24.4 TWh CHP electricity. These figures are, however, partly overlapping: approximately 8 TWh of electricity was produced in biomass CHP plants. Most of the electricity from renewable energy sources consists of hydropower (14.4 TWh in 2000) and biomass CHP. Most of the biomassbased CHP was produced in industrial power plants, especially in forest industry (Fig.14). The total amount of wind power in 2000 was 77 GWh. The share of electricity 30 from renewable energy sources in Finnish electricity production is shown in Fig. 13. /13, 17, 32/. Other import 1 % Electricity imports 15 % Black liquors 8% Natural gas 10 % Wood 3% Oil 2 % Indigenous fuels 34% Coal 11 % Peat 5% Wind 0.1% Solar 0.0001% Biogas 0.04% Forest chips 0.2% REF 0.05% Hydro power 18% Nuclear power 27 % Figure 13. Primary energy sources in electricity production in Finland in 2000. /17/. The Finnish peak power of gross electricity was 13 310 MW and total capacity 15 540 MW in 2000. Power generation in Finland is based on a wide variety of production forms, each with its own distinctive cost structure. Power generation is highly decentralised, and 120 generation companies or utilities own about 400 power plants. Fortum Oyj produces about 40% of Finland's electricity. Industry and its electricity producers like Pohjolan Voima Oy have a share of approximately the same size. The share of the local and regional energy companies is about 15%. In addition, Finland imports electricity from Russia, Norway and Sweden to satisfy its remaining energy requirements. According to the VTT’s estimation, the demand for new electricity generating capacity would be about 3000 MW in 2010, and about 7 500 MW in 2020. According to the National Climate Strategy, electricity consumption would increase to 99 TWh/a by 2020 /13, 18/. The target set for power generation from renewable energy sources has been set that it can meet the target of RES-E Directive /13/, according to which the share of electricity generated from renewable energy sources should be 31.5% in 2010 (29.3 TWh) (Table 3) /1/. 31 Table 3. Targets for electricity production by RES specified in the proposal of the working group for revised Action Plan for Renewable Energy. /1/. BIOENERGY HYDROPOWER of which > 10MW of which < 10 MW WIND POWER SOLAR POWER TOTAL Share of total electricity consumption 1995 TWh MW 6.1 2 000 TWh 2001 MW 8.9 NA 2005 TWh MW 11.0 2 500 2010 TWh MW 13.6 3 050 2025 TWh MW 22.7 4 700 12.8 2 770 13.0 2 926 13.7 3 100 14.5 3 300 16.0 3 670 11.62 2 460 11.88 2 623 12.1 2 675 12.4 2 730 12.9 2 840 1.170 310 1.150 303 1.6 425 2.2 570 3.2 830 0.011 6 0.07 39 0.33 150 1.1 500 5.1 2 000 0.001 1 0.002 2.8 0.02 19 0.05 40 0.5 500 18.9 27.4% 4 777 22.0 27.1% NA 25.1 29.2% 5 768 29.3 31.5% 6 890 44.3 41.6% 10 870 In Finland no licence is required for generating or selling electricity. In distributed heat production, biomass is already widely used in Finland, though there are no specific regulations promoting distributed production in the Electricity Market Act. Distributed electricity generation is basically competing in the same conditions as any electricity, but there are some tax relieves for electricity generated from renewable energy sources (see Fig. 4 and 5, App. B) /8, 35/. In Finland, an environmental licence is required for power plants of thermal output of 5 MW or more. The environmental licensing procedure takes approximately 6 – 12 months. In addition, every project requires a building permit, which is granted within 3 – 12 months depending on the project. An Environmental Impact Assessment (EIA) is required for all larger-scale projects (thermal output of 300 MW or more), and also for smaller-scale projects case-specifically. EIA is also required for hydropower projects, if the project affects significantly the discharge and/or water level, when the annual main discharge of the watercourse exceeds 20 m3/s /35, App. B/. Wind power projects are so far not listed as projects requiring EIA. Usually, the environmental licence is neither required. According to the Land Use and Building Acts a wind power development must be justified by a land plan, before the building permit can be approved. The legal framework of especially off-shore wind power projects, partly also of projects located on mainland or on islands, is relatively complicated. This is a clear adverse effect on wind power development in Finland, because licensing procedures may last a long time /35/. 32 Finland has no special regulations for small or large-scale hydropower; only some watercourses are protected from construction. A permit in accordance with the Water Act is required practically for every project. The permitting process is time-consuming and results often in compensation measures and environmental monitoring obligations, which are costly in proportion to the project size. At present, the hydropower installations seem to be feasible only as replacement investments, when placing a new turbine in an existing dam without changing the flow regime or surface levels of the watercourse /35/. 3.3 Use of renewable energy sources in electricity production 3.3.1 Biomass in electricity production For years, Finland has employed combined heat and power (CHP), which operate at a high power-to-heat ratio. The proportion of combined generation is among the highest in the world (33% of electricity consumption). The first industrial cogeneration plants were built at the turn of the 1920s and 1930s. Cogeneration is the natural choice in Finland, since both heat and electricity are required in industrial as well as in municipal energy production /5, 9, 17/. During the recent five years more than 100 district heating plants and 500 MWe of new additional capacity for electricity production from wood-based fuels have been commissioned in Finland (total capacity more than 2 000 MWe). Most of electricity production based on biomass comes from forest industry (Fig. 14). Total use of electricity in forest industry is 26.3 TWh, which means that share of own production is 43%. /11, 17, 28, 43/. In larger CHP plants, FBC technology, developed in Finland in the 1970s for the combustion of biomass and other low-grade fuels, has become a dominant technology. Simultaneously, fuel-handling technologies have been developed. Also a lot of effort has been focused on utilising wood residues from the forest industry. In recent years, use of forest residues has been increasing. Integrating the fuel and raw material supply chains has decreased the costs of forest fuels (App. D). One the methods used in harvesting of forest residues is bundling technology (Fig. 15) /23, 24/. The production system of forest chips is based on the use of chippers, and different chipping systems are defined on the basis of the location of the chipper. The production costs are primarily due to moving and transports of biomass /24/. 33 In chipping at the site of use, biomass is transported direct to the site of use, where the biomass is chipped in a stationary crusher. Due to the high capacity of crushing, the operation cost is low. Biomass is transported from the forest as loose material, whole trees, or in bundles (Fig. 15). Transport of bundles is the most cost-effective and feasible alternative with regard to process management. Bundling technology of logging residue has developed briskly in recent years. It has proved to be the best alternative when chipping at the site of use. The handling unit is a bundle, 60 – 70 cm in diameter that has been bundled and bound tightly. Coal 0.04 TWh Heavy fuel oil 0.3 TWh Others 0.3TWh Solid wood 2.1 TWh Peat 0.9 TWh Wood 7.2 TWh Black liquors 5.0 TWh Natural gas 2.7 TWh Other by-products 0.1 TWh Figure 14. Electricity production in forest industry. Total electricity production in 2000 was 11.4 TWh. Source: Finnish Forest Industries Federation. Figure 15. Forest residue harvesting by bundling technology. 34 Energy production based on biomass is rather often hampered by limitations in the supply and/or quality of the biomass. That is why cofiring with two or more fuels is widely used. This is especially true in large-scale electricity production, where the biomass can seldom meet the total fuel demand in a cost-efficient way /23/. Successful cofiring of biomass requires attention to the fuel properties and mixing techniques. Various types of biomass are frequently burnt together with peat or coal. Fuel flexibility ensures the economical operation of the plant even when there are seasonal limitations in the fuel supply /23/. Retrofitting of old pulverised fuel fired boilers to burn biofuels increase the fuel range and flexibility. Separate biomass gasifiers, which can also use wet biofuels and REF, are successfully demonstrated solution for existing pulverized coal fired plants. Fluidisedbed gasifiers can make efficient use of locally available fuels with low investment costs. Gasification of biomass and cocombustion of biomass-derived product gas in existing coal-fired boilers offer several advantages: minimal environmental impact, and low investment and operation costs /23, 37/. The electricity market price has been very low in the past few years due to market liberalisation and good hydrological years in Nordic countries. Due to the low market price, new investments have become unprofitable, affecting also distributed generation like small-scale biomass CHP. There is quite a common understanding that the electricity market price will increase during the following years. In addition to the market price there are other elements affecting the price for the production. The tariff structure of power distribution for power production can decrease or increase the profitability. The profitability of electricity production at different biomass plants is presented in App. D /23/. There are possibilities to increase the use bioenergy by over 50% in 1999 – 2010 (Table 4) and consequently, potential reduction in CO2 emissions is significant, 3 – 11 million tons of CO2. The development of new technology is an efficient way to reduce the costs of this. New technologies are needed to allow high power-to-heat ratios in CHP plants, to make smaller CHP plants competitive and to provide low emission levels and to facilitate operation and maintenance of private consumer applications /28/. Table 4. Wood fuel plants in operation/planning stage in Finland in 1997-2010 /16/. plants are mainly multifuel plants also using peat and part of the plants are retrofits of existing biomass plants. Plant type Municipal CHP plants Municipal DH plants Industrial CHP plants Industrial steam boilers Alholmens Kraft Total Number of plants 14 74 13 6 1 108 Electricity output, MW e 225 0 395 0 240 860 35 Heat output, MWth 540 240 990 85 160 2 015 Boiler output, MWth 890 275 1600 100 580 3 450 3.3.2 Hydropower Next to energy from biomass, hydropower is the second largest source of renewable energy production in Finland. The largest share (approx. 90%) is large-scale hydropower. The capacity of hydropower in Finland is about 3 000 MW, the share of small-scale hydropower being 300 MW. The plants are mainly owned by electricity distributing companies and industry. There are numerous old dams and abandoned small hydropower stations, once used as power sources for flour mills and saw mills. In 2000, total production of small-scale hydro plants reached 1.2 TWh /1, 2, 17/. The national target of hydropower is specified in the revised Action Plan for Renewable Energy (Tables 1 and 3). The target for 2010 is a 570 MW installed hydropower capacity, generating 2.2 TWh. VTT has estimated that the potential of new hydropower capacity equals 4 TWh and 946 MW /1, 2, 27/. Figure 16. New tube turbines were installed at a Liunaa municipal hydropower plant in Joroinen. The total output of the plant is 0.9 MW. Photo: Motiva Oy. Strong environmental concerns severely limit the possibility of new hydropower capacity in Finland. Mini hydro (<1 MW) is promoted through the energy tax exemption (see Fig. 4 and 5), but capacities over 1 MW do not receive any electricity production support. Some additional production will be attained from renovation or 36 repowering of existing plants. Equipment manufacturers in Finland have been concentrating on the development of small-scale hydropower machinery and equipment (Fig. 16, see also App. A) /36/. 3.3.3 Wind power The target in the Action Plan for Renewable Energy for wind energy deployment is set at 500 MW in 2010. The wind energy production would reach 1.1 TWh/a in. Today, the use of wind power is about 70 GWh annually and capacity 41 MW (Fig. 17, App. E) /17, 34, 43/. 90.0 76.6 80.0 Production (GWh) 69.9 70.0 Capacity (MW) 60.0 49.1 50.0 40.0 30.0 16.6 20.0 10.0 4.3 7.2 10.8 23.5 11.0 2.4 0.0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Figure 17. Development of wind energy production and installed capacity in Finland from 1992 to 2000 /43/. The turbines now in operation in Finland are from Denmark and Germany and one from Finland. Large turbines have for a long time been preferred, mainly due to difficult siting in the complex coastal landscape. The projects planned to be constructed in 2003 use turbines with a power rating from 1 MW to 2.5 MW /34/. The turbines installed in the harsh climate of northern Finland are protected with icepreventive equipment. The same solution is tested at certain sites in southern Finland, which have a public safety concern due to occasional icing. Experience shows that the higher the tower and the closer to sea the turbines are, the more prone they are to occasional icing /34/. 37 The electricity market has been fully liberalised, thus all wind energy installations are “merchant“ producers that have to find their customers on a competitive market. Current market prices are that low and, despite the quite substantial support, wind energy cannot yet compete with spot prices for electricity. Most turbines are owned by or operated in co-operation with a local utility to facilitate the access to the energy market /34/. The transmission and distribution charges for distributed generation vary across the country and are so high in some areas that they totally prevent local generation /34/. Wind energy deployment is slow, but there is still a continuous discussion on the environmental impacts of wind turbines. Land-use restrictions and visible pollution, especially in relation to summer residents and vacation activities, might yet prove a significant obstacle to development /34/. At a good site on coastal Finland, the cost of wind energy production could be about € 40 –42 per MWh, including an investment subsidy /34/. As stated above, all wind energy installations are “merchant“ power plants and have to find their customers on a free-power market. In most cases an agreement with a local utility is made, giving market access and financial stability. Some utilities have offered to buy wind energy production at a price higher than avoided costs in general. There are several companies offering green or secifically, wind – electricity, certified by the Association for Nature Conservation, and at a price higher than on average current for household price /34/. In spring 2001, a new Finnish manufacturer, WinWinD, presented its first prototype, which is now in operation in Oulu (Fig 18). The turbine has a rated power of 1 MW and it operates at variable speeds. It has a one-stage planetary gearbox and a permanent magnet generator. The aim is to develop the concept further into a 3.5 –MW turbine for offshore applications /34/. For some time, the Finnish industry has been able to produce main components such as gearboxes and induction generators, as well as materials like steel plates and glass-fiber for the main wind turbine manufacturers. The industry has been successful in supplying components to medium-sized wind turbines up to 1 MW, and the industry is developing its product range to fit also large-scale turbines. This has required some investments in new production facilities /34/. 38 A blade-heating system for wind turbines operating under icing conditions was released as a commercial product in 1998. It has been developed mainly for domestic market but also for export, and the first delivery to Sweden was made in 1998 /34/. Figure 18. WinWinD´s 1 MW prototype in operation in Oulu. There is a drive towards offshore locations of turbines. Careful design of the support structure is required for foundation and installation of turbines in the icy waters. A project to develop foundation and installation technology suitable for Finnish offshore conditions has been initiated in a co-operation between research bodies and industry /34/. 3.3.4 Green electricity and green certificates in Finland There are about 40 electricity retailers in Finland offering green electricity products. The total supply of green electricity products is therefore difficult to assess. There are, however, some well-established trademarks on the market: “Norppa recommends ecoenergy” (Norppa suosittelee ekoenergiaa), “Efficient power” (Hyötysähkö), “Efficient wind” (Hyötytuuli), and “Eco-electricity” (Ekosähkö) /32/. There are many green electricity products, usually premium-priced, on the Finnish electricity market. However, green electricity products have not to date gained a remarkable market share. Only a fraction of the total green electricity production is 39 actually sold as a premium priced “green product”. At the end of April 2002 there were 22 companies having the right to use the “Norppa recommends eco-energy” label. The annual “Norppa-certified” electricity production is currently about 1.2 TWh. In 2000, about 100 GWh of this production was actually sold as “Norppa recommends ecoenergy” electricity. The rest was sold as normal electricity and not as a premium-priced product. There were around 5 500 customers, mainly households, in the end of 2001. In 2000, the supply of “Eco-electricity” amounted to 131.1 GWh. Respectively, the sold amount of “Eco-electricity” in 2000 was 8.6 GWh /32/. At the moment there is little domestic demand for Green Certificates (GCs) in Finland, since no real incentive for buying such certificates exists. There is, however, demand for Finnish GCs abroad. Some national green certificate systems allow for importing GCs in the system. This is the case, e.g., in the Netherlands, where a considerable amount of Finnish GC import has occurred /32/. There is also an international pilot initiative by the industry, the “Renewable Energy Certificate System” (RECS), within which some trading has taken place since the beginning of 2001. There is currently considerable oversupply in the system. Towards the end of March 2002, there were over one million megawatt hours Finnish RECS certificates offered for sale, but only 148 megawatt hours had actually been sold in the system. Currently some 60 Finnish electricity production sites have been registered in RECS /32/. 3.4 Heat markets in Finland District heating was started in the largest cities of Finland in the 1950s and 1960s, and in smaller towns after the oil crisis in the 1970s. Most of the district heating utilities are owned by municipalities. The sales of district heat is an extensive business. The turnover of district heating was about € 700 million in 2000. District heating systems cover practically all densely populated areas of Finland, where the sale of district heating is profitable /9/. Because of the cold climate, it is necessary to heat houses in Finland for most of the year. About one fifth of the energy consumed in Finland goes to heating buildings. The major heating forms are district heating (48%), individual oil heating (18%) and electric heating (15%). Wood heating systems cover 13% and other including heat pumps and solar energy 2%. There are 2.3 million buildings in Finland, of which about 50% are single–family houses. Annually about 10 000 new single-family houses are built (Tables 5 and 6) /9, 14/. 40 The target is to increase the use of wood fuels in the heating sector in households and in the district heating sector. In the revised Action plan for Renewable Energy the use of wood fuels in households is targeted to increase by 27 PJ by 2010 (46%). In the district heating sector (includes also CHP plants generating district heat) the target is to increase the use of wood fuels to 44 PJ by year 2010 (Table 1) /1, 2, 27/. Table 5. Net effective heating energy of residential, commercial and public buildings (GWh) in 1990´s /17/. Year Small-Scale Peat Coal Heavy Fuel Light Fuel Natural Gas Ambient District Electricity Total Combustion Oil Oil and LPG Energy etc Heating Heating of Wood 1990 5 836 128 62 2 790 12 567 295 .. 20 240 6 259 48 177 1991 5 913 75 40 2 721 12 285 385 .. 21 390 6 709 49 517 1992 5 928 40 68 3 066 12 285 365 .. 21 460 6 638 49 851 1993 5 974 68 40 2 059 11 223 395 .. 22 300 6 972 49 031 1994 5 989 53 115 1 372 12 068 428 .. 22 920 7 418 50 363 1995 6 264 90 15 828 10 370 450 213 22 580 6 960 47 769 1996 6 569 95 15 872 10 651 480 225 24 620 7 618 51 145 1997 6 569 92 17 869 10 654 525 229 24 080 7 607 50 642 1998 6 646 93 17 874 10 797 480 242 25 210 8 020 52 378 1999 6 493 92 17 851 10 573 534 246 24 750 7 970 51 525 2000 6 325 85 15 768 9 182 515 883 23 720 7 620 49 113 Share 12.9% 0.2% 0.03% 1.6% 18.7 % 1.1% 1.8 % 48.6 % 35.5 % 100 % District heating and electric heating are calculated as net effective heating energy as such. The conversion factor used for ambient energy is 1.5; thus the figure is inclusive of the electricity consumption of heat pumps. The following default efficiencies are used for other heating energy sources: small-scale wood combustion 55%, peat 60%, coal 60%, heavy fuel oil 83%, light fuel oil 78% and natural gas 90%. Table 6. Selection of heating system in new single-family houses in Finland (number of houses). Rakennustutkimus RTS Oy. Heating system Light fuel oil Electricity District heating Ambient heat (heat pumps) Wood heating Total 1996 1 500 4 100 400 200 1 100 7 300 1997 1 800 5 800 600 400 1 400 10 000 1998 2 000 6 600 800 600 1 200 11 200 1999 2 100 6 800 900 900 900 11 600 2000 1 300 7 000 900 1 300 1 100 11 600 3.4.1 District heating There are over 200 heat distribution utilities in Finland, and most of them produce at least part of heat by themselves. About 50 of them produce also electricity in connection with district heating. Some municipalities have co-operation with power companies or local industries. CHP based heat production was 76% of the total district heat production in 2000. The total district heating capacity is 14 360 MWth. Many large cities own CHP plants. Most of their output is still sold within the area of the owner cities. Medium-sized and small towns purchase district heat from CHP plants or industrial CHP plants owned by other companies, or produce it themselves in heat-only boilers /14, 17, 47/. 41 The fuels used in CHP and in district heating production vary from municipality to municipality. Over 95 PJ of district heat was produced in Finland in 2000. The most common fuels were natural gas 38%, coal 27%, peat 17%, oil 6%, wood and wood residues 8% and others 4%. In the future the fuel mix will change considerably (Fig. 19). Natural gas and wood will largely be used as substitutes for coal, oil and peat (Fig. 20). Use of recovered fuels has also increased considerably during the last few years /14, 17, 45/. Wood, 8.5% Others 3.5% District heat production 95 PJ (26.4 TWh) Coal 26.7% Oil 6.2% Average selling price 34.68 €/MWh Number of homes heated by DH 1.1 million District heat production by cogeneration 78 % Electricity 11.7 TWh 2.4 million people living DH heated buildings 48% of houses heated by DH Peat 17.3% Natural gas 37.8% Net selling 700 million € Total fuel utilization 168.9 PJ Source: Finnish District Heating Association Figure 19. Use of fuels in production of district heat and power. Source: Finnish District Heating Association. TWh PJ 4 14.4 3 10.8 2 7.2 District heat and municipal CHP Separate heat production 3.6 1 0 1982 1984 1986 1988 1990 1992 1994 1996 1998 2001 Figure 20. Use of wood fuels in generation of district heat. Source: Finnish District Heating Association. 42 2002 3.4.2 Use of wood fuels in space heating There are almost 200 000 central house heating systems using wood fuels in Finland. The small-scale systems are typically used in detached houses or on farms. Wood chips and split logs are used in most of the systems, whilst wood pellets are burnt in some 500 boilers. However, the share of pellets is growing fast. Vapo Oy has estimated that in 2003, there are about 1 500 detached houses using wood pellets (10 000 tons/a) and a few hundred larger buildings using pellets (15 000 tons/a). Pellets could substitute light fuel oil, which gives techno-economic potential of 25 PJ/a. Around 5 000 detached houses, larger buildings and farms are heated with forest chips /10, 23/. Almost 90% of these 1 million detached houses have a fireplace or stove made of heatretaining material. Usually, a wood stove or fireplace is used as an auxiliary heat source in single–family houses. According to Rakennustutkimus RTS Oy 60% of these houses are using wood fuels. In total about 6.1 million solid-m3 firewood (47 PJ) has been used annually for space heating in stoves and small-scale boilers. The leading consumers for firewood in Finland are detached houses (3.1 million solid-m3, 3.8 solid-m3 /house) and farmers (2.2 million solid m3, 14.4 solid-m3/farm). In holiday homes 0.7 million solid m3 (1.8 solid-m3/house) is used and in other small houses 0.1 million solid-m3. Wood is mainly burnt cut or split into small size. In Finland, the number of stoves and fireplaces reaches almost two million. About 20% of split logs (1.2 million solid-m3 are used in sauna stoves /39/. 3.4.3 Heat pumps Heat pumps offer the most energy-efficient way to provide heating and cooling in many applications, as they use renewable heat sources already existing – the air, ground and water. Heat pumps can meet space heating, hot water heating, and cooling needs in all types of buildings, as well as many heating requirements in industry /29/. In Finland heat pumps are mostly used for space and water heating as well as for cooling in buildings. Use for industrial needs is still marginal but gradually increasing. Total production of heat pumps was 2.1 PJ in 2000 in Finland /29/. Fifteen percent of new house builders (Table 5) choose heat pump as the primary energy source. Total annual energy use of a typical house is 20 000 kWh (72 GJ). According to Finnish Heat Pump Association (SULPU) the heat pump sales have increased tenfold during the last five years. In 2000 there are 25 000 heat pumps installed in detached houses in operation /29/. 43 Renovation of heating systems opens up the market for heat pumps. About 25 000 water distributed heating systems are in the need of renovation annually. That potential has aroused optimism in the heat pump field /29/. For operating the heat pump external energy is needed. Electrically driven heat pumps for heating buildings typically supply 100 kWh (360 GJ) of heat with 35 - 40 kWh of electricity. Because heat pumps consume less primary energy than conventional heating systems, the technology is important in reducing greenhouse gases. However, the overall environmental impact depends on how the electricity is produced /29/. In Finland heat pumps are mainly used for space and hot water heating in single-family houses. Ground source heat pumps are most commonly used representing 80% of the total market. Ground source and exhaust heat pumps are best suited for houses with water distribution heating systems. Air source heat pumps complement best direct heating with electricity /29/. 3.4.4 Solar heat and power Solar thermal energy is included in the revised Action Plan for Renewably Energy. In this plan, the objective is to increase the use of solar thermal energy applications 13 times (equalling 170 TJ) from 2001 to 2010. The target for solar power is an increase of 40 MW installed capacity, generating 0.05 TWh /1, 2, 25, 51/. The solar thermal market in Finland is relatively small. In 2000 collector sales were at the level of 1000 m2/a. No official statistics on the installed solar collector area and systems exist. The total collector area installed during the period 1982 – 2000 is some 7 800 m2. In addition to this, it is estimated that around 90 000 m2 of unglazed perforated absorber plates are installed in crop and hay drying applications. During the last few years, from 1995 to 2000, the annual sales of flat plate collectors increased from 500 m2 to 1000 m2. Energy production is about 18 TJ/a /44/. Due to the small market volume and relatively cheap alternatives (such as electricity, fuel oil and district heating) solar heating has not been competitive in Finland /44/. Some larger-scale demonstration projects of high visibility have been implemented with subsidies – often within the framework of various EU programmes. These projects normally have 100 – 200 m2 of collector area and are combined with district heating. One larger project, Eko–Viikki with 1000 m2 of collector area, was implemented in Helsinki in 2001 – 2002 /44/. 44 Most of PV products are exported (70%). In summer, the insolation is also in Finland at a relatively good international level and there are applications, in which the need of energy is concentrated on the summer period. The annual availability of solar energy is a little less than 1 000 kWh/m2 in Finland. The most outstanding commercially competitive solar electric applications are around 40 000 holiday cabins run with PV modules and the 2000 navigation aid systems (Fig.21). The total output of these applications are 2.3 MWp, i.e. about 7.2 TJ/a. House-integrated photovoltaic systems, on roof or façade, are regarded as a new promising application to be commercialised. The first application of this kind was installed in 1990 in Sjökulla for the building of Helsinki University of Technology. The biggest application is installed in Tampere in a department store (38 Wp) /36, 44/. Figure 21. Solar heating and PV in holiday cabin. Vesa Erkkilä. 45 Finland has chosen for its basic strategy the Road Map approach, according to which the final goal is reached through interim targets and well-timed measures. The Solar Road Map /51/ the direction, but the actual progress depends on the activity of the actors. The programme focuses on solar heat and solar electricity. The measures are directed at built environment and the applications of outlying areas, which yield the best added value /51/. The National Solar Energy Programme aims at giving to the Finnish industry new business worth € 150 million per year, of which 80% would be export. The total estimated demand for public financing until the year 2010 is € 25 million. To support the National Solar Energy Programme, the co-operation group Finnish Solar Industries (FSI), consisting of strategic companies and actors, has been established. By the end of year 2001, the solar energy network included 20 actors, and a total of 50 potential actors had been recognised (see app. A) /51/. A solar heating system can cover 10 – 30% of the heating energy requirement of a single-family house. A solar electricity system connected to the electric power network can produce all the household electricity needed in a single-family house, by storing electricity virtually in the network /51/. 46 4. Summary One of the strengths of Finland’s energy economy is the wide variety in the production structure. Increasing the use of renewable energy sources is an explicit goal of the Finnish energy strategy. Renewable energy sources are important both in limiting carbon dioxide emissions and for ensuring the security of Finnish energy supply. Moreover, utilisation of renewable energy sources especially bioenergy has positive effects on employment on the local level. In 2000, renewable energy sources accounted for about 25% of all energy consumption in Finland. The percentage for wood energy was over 20%, the rest of the renewables being mostly hydropower. The Finnish share of renewables in energy consumption is the third highest percentage in the EU, and for bioenergy, the highest. The National Climate Strategy, launched by the Finnish Government in 2001, highlights the targets and measures to meet the Kyoto commitments in Finland. In order to meet the climate change targets, it is necessary to implement an energy conservation programme and a programme promoting renewable energy sources. The principal objective of the Action Plan for Renewable Energy is to promote renewable energy sources, by utilising various promotion measures, to improve the competitiveness of renewable energy sources in relation to other energy sources, thereby increasing the use of renewable energy in keeping with the goals set. The long-term objective is to make renewable energy sources competitive on the open energy market without continuous support measures. There are possibilities of increasing the use bioenergy and other renewable energy sources by more than 50% by 2010 and consequently, the potential reduction in CO2 emissions is significant, 3 – 11 million tons of CO2. The development of new technology is an efficient way to reduce the costs. 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Ylitalo, E. (ed). 2001. Puupolttoaineiden käyttö energiantuotannossa vuonna 2000. [Use of wood fuel in energy production in 2000], Metsätilastotiedote 574. Suomen virallinen tilasto Maa,-metsä- ja kalatalous 2001:16. 7 p. (in Finnish). 63. Ylitalo, E. (ed). 2002. Puupolttoaineiden käyttö energiantuotannossa vuonna 2001. [Use of wood fuel in energy production in 2001], Metsätilastotiedote 620. Suomen virallinen tilasto Maa,-metsä- ja kalatalous 2001:15. 8 p. (in Finnish). 50 Liite A: List of RES organisations in Finland BIOENERGY WOOD LOGGING AND PROCUREMENT Evimet-Group Oy Energy grab for forest tractors www.nic.fi/~evim Kesla Oyj Wood logging machines, hydraulic loaders, trailers, chippers www.kesla.fi Laitilan Rautarakenne Oy Firewood harvesters www.japa.fi Logset Oy Logging machines, chippers www.logset.fi Maatalouskonemyynti Markkula Matti Tmi Skidding grabs, wood chopping and splitting machines tel. +358-3-517 108 Veljekset Pirttinen Oy Chain delimber, wood chopping and splitting machines tel. +358-6-488 1040 Vesannon Pyörä- ja Pienkonehuolto Ay Felling handles for chain saws tel. +358-17-650 744 WOOD FUEL CHIPPING, CRUSHING AND CHOPPING, PELLETIZING Agromaster Oy Wood chopping and splitting machines www.agromaster.fi Agronic Oy Screw chopper www.agronic.fi Bilke Oy Wood chopping and splitting machines www.bilke.net Junkkari Oy Chippers www.mako-junkkari.fi Kesla Oyj Wood logging machines, hydraulic loaders, trailers, chippers www.kesla.com Korpelan Konekorjaamo Wood chopping and splitting machines tel. +358-6-363 1470 Laitilan Metalli Laine Oy Chippers www.laimet.com Laitilan Rautarakenne Oy Wood chopping and splitting machines www.japa.fi Lehtoniemen Metalli Wood chopping and splitting machines tel. +358-17-558 0574 LHM Hakkuri Oy Chippers www.lhmhakkuri.com Orion Yhtymä Oyj NORMET Chippers, logging machines, skidding equipment www.normet.fi Energiansäästö Oy Chippers www.energian.net Pinomäki S. Ky Wood logging machines – small scale www.spinomaki.fi Fenikon Oy Wood chopping and splitting machines tel.+358-3-367 0033 Raussin Metalli Ky Harvesters, crushers www.raussinmetalli.com Oy Fiskars Ab Handy and power axes www.fiskars.fi Maatalouskonemyynti Markkula Matti Tmi Wood chopping and splitting machines tel. +358-3-517 108 Sunit Mobile Oy Vehicle computers, machine control systems, GPS positioning and wireless data transfer systems www.sunit.fi Heinola Sawmill Machinery Wood chippers and wood processing equipment www.heinolasm.fi or www.heinolasm.com Manukone Tmi Mechanical axe tel. +358-2-438 3519 Timberjack Oy Harvesting machines www.timberjack.com Valtra Oy Ab Harvesting machines www.valtra.fi or www.valtra.com Maaselän Kone Oy Wood chopping and splitting machines www.maaselankone.fi Ideachip Oy Chippers and crushers www.ideachip.fi Mepu Oy Wood chopping and splitting machines, dryers www.mepu.com Jalonen Markku Tmi Circular saw choppers, screw splitters tel. +358-2-731 4588 Metallityö Mölsä Jorma Tmi Wood chopping and splitting machines tel. +358-19-626 276 A1 Nokka-Tume Oy Forestry machines, wood chopping and splitting machines www.nokkatume.fi Pakolan Konepaja Wood chopping and splitting machines tel. +358-8-440 981 Peuralan Konepaja Ky Wood chopping and splitting machines tel. +358-6-437 7122 Pihlajamäki Veli Tmi Wood chopping and splitting machines tel. +358-6-512 0715 Pinomatic Oy Crushers www.pinomatic.fi Pirttinen Tapio Oy Wood chopping and splitting machines www.kauhavanyrittajat. netsrv.fi/ asiakas/ harmanmaa/yritykset.nsf Terästakomo Oy Wood chopping and splitting machines www.terastakomo.com Kivia Oy Soapstone stoves and fireplaces www.kivia.com TP-Stokeri Oy Stoker burners, chippers tel.+358-2-868 1484 Lapin Liesi ja Metalli Ky Heating devices tel. +358-2-826 0555 Veljekset Pirttinen Oy Chain delimber tel. +358-6-488 1040 Lämpötaltio Oy Burners tel. +358-3-513 4225 Veljekset Sarvela Oy Wedge axes tel +358-9-2790 130, Misa Oy Kitchen and sauna stoves tel. +358-5-414 6391 FUEL HANDLING AT PLANT Narvi Oy Stoves, water heaters and chimney flues www.narvi.fi BMH Wood Technology Oy Solid fuel handling equipment www.bmh.fi Fortum Power and Heat Oy Bed mixing dryer for biomass www.fortum.com Nunnanlahden Uuni Oy Soapstone stoves, kitchen stoves and fireplaces www.nunnauuni.fi Raumaster Oy Fuel handling equipment www.raumaster.fi Suomen Eurouuni Oy Soapstone fireplaces and stoves tel. +358-15-165 144 Pulkkasen Konepaja Splitting axes tel. +358-8-857 110 Roxon Oy Fuel handling equipment www.roxon.fi or www.roxongroup.com Tulikivi Group Soapstone stoves, kitchen stoves and fireplaces www.tulikivi.fi Sisu Auto Oy Chipper lorries www.sisuauto.com Vesme Systems Oy Fuel handling equipment www.vesme.com Tunnelmauuni Oy Fireplaces and stoves www.tunnelmauuni.com SP-Suomi Oy Wood chopping and splitting machines tel. +358-9-256 8876 STOVES AND FIREPLACES Uunisepät Oy Fireplaces, kitchen stoves and stoves www.uunisepat.fi Suokone Oy Crushers www.suokone.com Tarkväli Oy Wood chopping and splitting machines www.jarviseutu.fi/jarvimetalli /tarkvali TEM-tuote Ky Wood chopping and splitting machines tel.+358-6-488 5016 Harvia Oy Fireplaces and stoves, fireplace inserts, saunas www.harvia.fi Kastor Oy Fireplaces and sauna stoves www.kastor.fi Kaukora Oy Small scale grate boilers for biomass, burners www.kaukora.fi Kerman Savi Oy Fireplaces and stoves www.kermansavi.fi A2 Woodheat Finland Ltd (Puulämpö Suomi Oy) Stoves and cast iron components for stoves and fireplaces www.puulamposuomi.fi BOILERS, GASIFIERS AND BOILER PLANTS Akvaterm Oy Small-scale heating boilers and accumulator www.akvaterm.fi Condens Oy Biomass gasifiers and gasification plants www.condens.fi Farmenergi Oy Fuel handling equipment, boiler plants – small-scale www.farmenergi.fi Finstoker Oy Suomen kuivaamo Heating plants of over 200 kW-medium scale fax +358-9-222 4834 www.finstoker.fi Karsta-Karhu Oy Heating devices tel. +358-9-3409 0615 Kauhametalli Group Oy Small scale grate boilers tel. +358-6-2321 181, +358-6-230 2000 Kaukora Oy Small scale grate boilers, burners www.kaukora.fi Konepaja Eneka Oy Small-scale grate boilers tel. +358-2-4863 400 Fortum Oyj Boiler plants – medium and large scale www.fortum.com KPA Unicon Oy Small scale grate boilers www.kpaunicon.com Foster Wheeler Energia Oy Boiler plants – large scale www.fwc.com Kvaerner Pulping Oy Boiler plants – large-scale www.kvaerner.com Heat Mill Oy Heating centres tel. +358-17-366 9150 Laatukattila Oy Small and medium sized grate boilers tel. +358-3-214 1411 HT Enerco Oy Small and medium sized boilers www.htlaser.fi HT Engineering Oy Pelletizing factories and pellet heating plants, pellet burners Heating plants of over 200 kW www.htlaser.fi Insinööritoimisto Krokfors Oy Small-scale boilers tel. +358-208 322 265 Jorma Loukola Ky Stoker burners, pellet burner manufacturer/importer tel.+358-6-4731 475 Jämätek Oy Small-scale boilers www.jamatek.fi Kari Nummela Oy Pelletizing and briquetting plants, pellet burner importer www.pelletti-peloton.fi Livite Oy Boiler plants (0,5–10 MW) www.livite.fi Masa-Tuote Ky Small-scale boilers, fuel feeding equipment www.masatuote.fi Mepu Oy Dryers www.mepu.com Nakkilan konepaja Boiler plants, dryers (0.5–2.5 MW) www.nakkilankonepaja.fi/eng PJ-Automation Oy Small-scale boilers and stoker burners tel. +358-6-231 4766 Rakennustempo Oy /GreenFire Oy Small-scale boilers for moist fuels www.rakennustempo.fi Savon Kuljetin ja Teräs Oy Pellet systems (20-150 kW), silos, conveyors, dischargers, burners www.koti.reimari.net/ savonkulj Suomen Bio-Lämpö Oy Small and medium scale biomass boilers www.saunalahti.fi/~biolampo/ otisivub.htm Suomen Etupesät Small-scale grate boilers and pre-ovens www.warmax.agrolink.net Säätötuli Oy Small-scale boilers www.saatotuli.fi Termocal Oy Small-scale boilers www.termocal.fi Termopoint Oy Mechanical grate boilers (1–12 MW), conveyer systems, plant modernisation www.termopoint.fi Teuvan Keitintehdas Oy Hot and warm water systems fired with wood logs www.teuva.fi/keitin Thermia Oy Small scale grate boilers, burners (<2 MW) www.thermia.fi TP-Stokeri Oy Stoker burners, chippers www.kotisivu.dnainternet.net/ tpstokeri.fi Pro-Lämpö Oy Pellet boiler plants tel. +358-3-347 3600, Trombisel Oy Small scale boilers www.jarviseutu.fi/jarvimetalli/ trombisel Putkimaa Oy Mechanical grate boilers – medium-scale www.putkimaa.fi Tulostekniikka Oy Heating plant designer and manufacturer (120–3000 kW) tel. +358-14-471 671 A3 Vaasan Kuljetuskanavat Fuel handling equipment, boilers, boiler plants – smallscale www.kuljetuskanavat.fi Vapo Oy Energia Heating plants (0.5–10 MW) www.vapo.fi Veljekset Ala-Talkkari Oy Small-scale boilers, burners www.alatalkkari.fi Wärtsilä Biopower Boiler plants – small and medium scale (1–10 MW) www.wartsila.com FLUE GAS CLEANING Condens Oy Clarifiers and filters , gas wet cleaning and heat recovery units www.condens.fi Foster Wheeler Energia Oy Flue gas cleaning, large-scale www.fwc.com Kvaerner Pulping Oy Flue gas cleaning, large-scale www.kvaerner.com AUTOMATION AA-Control Oy Exhaust gas sensors tel. +358-8-5315 500 Consor Technology Automated systems tel. +358-3-358 6999 Enermet Oy Energy meters and measurement systems www.enermet.com Honeywell Oy Automation systems www.honeywell.fi Metso Automation Automation systems www.metsoautomation.com Siemens Oy, Siemens Power Generation Automation systems www.siemens.fi EXPORTING BIOMASS FUELS Biowatti Oy Wood biomass, pellets www.biowatti.fi Turveruukki Oy Peat and wood biomass www.turveruukki.fi Vapo Oy Wood, peat and agrobased biomass, pellets www.vapo.fi CONSULTING AND ENGINEERING COMPANIES Brofta Oy Consulting of biomass district heating plants, international purchase services http://www.brofta.fi/ Carbona Oy Energy engineering and development of advanced IGCC technology tel. +358-9-540 7150 Elektrowatt-Ekono Consulting and engineering services in industrial and municipal energy production and distribution www.poyry.fi A4 Elomatic Papertech Consulting of biomass district heating plants www.elomatic.com FinBerca Biomass district heating plants http://www.finberca.fi/ Giga Power Consulting of biomass district heating plants tel. +358-17-551 3932 Jaakko Pöyry Consulting Oy Consulting in wood biomass harvesting, chipping and transport, pelletizing www.poyry.fi Jyväskylä Science Park Bioenergy development projects www.jsp.fi Osmo Kaulamo Engineering Oy Turnkey power plant projects and project management www.oke.fi Planora Oy Consulting of biomass district heating plants www.planora.fi Protermo Consulting, power plant design and project management www.protermo.fi Empower Oy Power plant technology, environment and renewable energy www.pvo-engineering.fi RAMSE Consulting Energy and environment services www.ramse.fi WIND ENERGY ENERGY PRODUCTION, MAINTENANCE, OPERATING EXPERIENCES Hyötytuuli Oy wind power production www.hyotytuuli.com Iin Energia Oy wind power production www.ii.fi Kemijoki Arctic Technology Oy Service and maintenance services www.kemijoki.fi Kemin Energialaitos wind power production www.keminenergia.fi Korsnäsin Tuulivoimapuisto Oy wind power production www.korsnas.fi Kotkan energia Oy wind power production www.kotkanenergia.fi Lumituuli Oy wind power production, wind electricity www.lumituuli.fi Oulun Seudun Sähkö Oy wind power production www.oulunseudunsahko.fi Pori Energia wind power production www.porienergia.fi Propel Voima Oy wind power production www.propelvoima.fi Tunturituuli Oy wind power production www.tunturituuli.fi Vattenfall/ Revon Sähkö Oy wind power production www.vattenfall.fi Ålands Teknologicentrum wind power production, consulting www.atc.aland.fi IMPORTERS, MANUFACTURERS, RETAILERS Fortum Engineering Oy wind turbines, solar electricity systems www.fortum.com Hafmex Oy small and large wind turbines, Lagerwey wind turbines www.hafmex.fi Mikron Ky Nordic Windpower Tel +358 9 298 8053, +358 9 298 7119 email: mikron@dlc.fi Nordex Ab Sales and marketing www.mekinor.se Kumera Oy Gearboxes www.kumera.fi Metso Automation automation, information and maintenance systems www.metso.fi Metso Drives Oy Gearboxes www.metso.fi Rautaruukki Oyj Steel products www.rautaruukki.fi Windside Production Oy Ltd Generators, blades www.windside.fi ANEMOMETERS Vestas - Scandinavian Wind Technology A/S Onshore and offshore wind turbines www.vestas.dk Labko Ice Detection Oy Ice detection of blades and removal systems, meteorological ice detectors www.labko.fi Windside Production Oy Ltd Windpower plants www.windside.fi Reino Rehn Ky Anemometers, weather stations Tel +358 3 346 0222 Winwind Oy Wind turbines www.winwind.fi Vaisala Oy Anemometers www.vaisala.fi COMPONENT MANUFACTURERS PLANNING, CONSULTING, AND BUILDING SERVICES ABB Motors Oy Generators www.abb.fi Cosphi One Design tools for power electronics Tel +358 40 564 2291 Hollolan sähköautomatiikka Oy Generators Tel +358 3 752 0732 Email: hsa@sci.fi Kemijoki Arctic Technology Oy Ice prevention systems for blades www.kemijoki.fi A2 Electrowatt-Ekono Oy Wind analyses, profitableness analyses, preand project planning www.electrowatt-ekono.fi EMP Projects Oy feasability calculations, environmental impact assements, project management, turn key supply www.empgroup.com Erkki Haapanen Engineering Oy Planning Tel +358 3 532 0600 Empower Oy Site planning, environmental assessments, project management www.pvo.fi Prizztech Oy Technology projects www.prizz.fi Windcraft Rotor expertise www.kolumbus.fi/suokas Vindkraftföreningen rf Project consultancy Tel +358 400 445 166 SOLAR ENERGY Eurosolar-Engineering Oy Solar and wind energy equipment www.eurosolar.com Oy HTI Tekniikka Ab solar panels Tel +358 9 222 5577 Solarwind Oy Solar and wind energy equipment www.solarwind.com Länsilasi Oy PV-modules Tel +358 2 629 5111 NAPS Systems Oy Solar panels www.napssystems.com Fortum Oy solar thermal systems www.fortum.com Oy Sabik Ab Solar navigational lights www.sabik.fi Sunfin Technologies absorbators Tel +358 020 366 000 hanslin@sunfin.com Soleco Oy Solar energy consulting www.soleco.fi Varta Oy solar panels www.varta.com SunWatt Oy Tel +358 9 8137673 Kaasuvalo Oy solar panels, gas appliances www.kaasuvalo.fi Solar Simulator Finland Ltd solar thermal products www.solarsimulatorfinland.co m PV Marketing Oy solar collectors, panels Tel +358 17 565 136 SunWind Oy solar panel imports, solar electricity appliances www.sunwind.fi HEAT PUMPS, DRILL WELLS Ahlsell Ref Oy air source heat pumps www.ahlsellref.fi Oy Callidus Ab whole sale, heat pumps, HVAC products www.callidus.fi Carrier Oy ground and air source heat pumps www.carrier.fi Cetetherm Oy heat exchangers www.cetetherm.com Danfoss Oy Ab cooling technology www.danfoss.fi Energent Oy ground source heat pumps, ventilation equipment www.energent.fi Haato Varaajat ground, air and exhaust air source heat pumps www.haato.fi ILP-Tekniikka Oy ground, air and exhaust air source heat pumps www.ivtlampopumput.fi Insto Kessele Oy heat pump installations www.kessele.com Jäähdytyskone Oy draining heat pumps www.esteri.com A2 Kaivonporaus Tom Allen Oy drill wells, ground source heat pumps www.tomallen.fi Kaukomarkkinat Oy air source heat pumps www.panasonic.fi Kemira Chemicals Oy heat collector liquids www.kemira.com RE-Energiset Oy ground source heat pumps www.re-energiset.fi Onninen Oy whole sale, heat pumps, HVAC products www.onninen.fi Poratek ry drill well consulting www.poratek.fi Suomen Tempcold Oy cooling technology www.tempcold.fi Thermosystems Oy ground source heat pumps www.thermosystems.fi Saariston Kaivonporaus Oy drill wells, ground source heat pumps www.kaivonporaus.com SWEP Energy Oy heat exchangers www.swep.se Oy Uponor Ab Finland heat collector piping and under floor heating www.uponor.fi Suomen Lämpöpumpputekniikka Oy ground source heat pumps www.slp-tekniikka.fi Tekeda Ky exhaust air heat pumps www.lohja.fi/tekeda Wilo Finland Oy heat piping and liquid pumps www.wilo.fi Thermia Oy ground and air source heat pumps www.thermia.fi HYDROPOWER WaterPumps WP Oy water pumps, water turbines Tel +358 9 3855 907 e-mail: wpoy@sci.fi GE Hydro water pumps, water turbines www.gefinland.com ATA Gears Oy Small-scale water turbines www.ata-gears.fi POLICY AND RESEARCH FUNDING Tekes, the National Technology Agency of Finland Financing for applied and industrial R&D www.tekes.fi The Ministry of Agriculture and Forestry Administration of forest and agriculture www.mmm.fi The Ministry of Environment Administration of environmental policy www.vyh.fi Motiva Oy Information on energy efficiency and renewable energy sources www.motiva.fi The Ministry of Trade and Industry, Energy Department Energy administration www.ktm.fi ASSOCIATIONS The Bioenergy Association of Finland (FINBIO) www.finbioenergy.fi Finnish Electricity Association – Sener www.energia.fi Finnish Biogas Centre www.kolumbus.fi/ suomen.biokaasukeskus Finnish Energy Industries Federation – Finergy www.energia.fi Finnish District Heating Association www.energia.fi Finnish Heat Pump Association (SULPU) www.sulpu.fi Finnish Forest Industries Federation www.forestindustries.fi Finnish Wind Energy Association www.tuulivoimayhdistys.fi A2 Small-scale Hydropower Association http://koti.welho.com/jhiltun4/ hiltunen@welho.com Solar Energy Association Finland www.avenet.fi/aty Vindkraftföreningen rf Tel +358 400 445 166 Wood Energy Association www.puuenergia.fi RESEARCH INSTITUTES Agricultural Research Centre of Finland, Institute of Crop and Soil Science Energy crops www.agronet.fi/mtt European Forest Institute EFI Forestry science www.efi.fi Finnish Meteorological Institute Wind measurements , Wind indexes, Finnish Wind Atlas www.ilmatieteenlaitos.fi Finnish Forest Research Institute (METLA) Forestry science www.metla.fi Metsäteho Oy Wood procurement and production www.metsateho.fi Technical Research Centre of Finland, VTT Renewable Energy Sources www.vtt.fi/pro TTS-Institute Wood fuel production and small-scale combustion technology, energy crops production www.tts.fi Research in Finland www.research.fi UNIVERSITIES Helsinki University of Technology Laboratory of Energy Economics and Power Plant Engineering Combustion and gasification technology www.hut.fi Lappeenranta University of Technology Energy technology and econimics www.lut.fi Tampere University of Technology Combustion and modelling, heat pump research www.tut.fi University of Helsinki Agricultural and Forestry Science (energy crops) www.helsinki.fi/ University of Joensuu Forestry Science, biogas www.joensuu.fi University of Jyväskylä Renewable Energy Sources www.jyu.fi University of Kuopio Department of environmental sciences Combustion related aerosol research http://www.uku.fi/laitokset/ifk/ University of Oulu Peat, wood and agrobiomass production and utilization www.oulu.fi Åbo Akademi University Combustion and gasification www.abo.fi POLYTECHNICS Jyväskylä Polytechnic School of Natural Resources bioenergy www.jypoly.fi Kymenlaakso Polytechnic bioenergy www.kyamk.fi/ North Carelian Polytechnic bioenergy www.ncp.fi Pohjois-Savo Polytechnic bioenergy www.pspt.fi Mikkeli Polytechnic bioenergy www.mikkeliamk.fi A2 Rovaniemi Institute of Technology heat pump testing and education www.ramk.fi/mlp-testaus Satakunta Polytechnic bioenergy www.spt.fi/ Appendix B: Legislative references LAW OR REGULATION NUMBER MAIN SUBJECT FIELD AFFECTED REMARKS NATURE CONSERVATION, WATER AND WETLAND PROTECTION Nature conservation act 1096/1996 Environmental policy Biomass Conservation of natural resources, and Decree 160/1997 Hydroenergy formation of natural reserves Wind energy Solar energy Cogeneration Water act and decree 264/1961 Environmental policy Hydroenergy Permission to drain or ditch cultivated land 282/1962 Renewable energy sources Biomass or wetlands, construction of bridges, 646/1992 hydroelectric power plants, dams, ponds, 750/1996 etc. 88/2000 689/2000 170/2000 Waterfalls protection 35/1987 Environmental policy Hydroenergy Conservation of nationally important act Renewable energy sources waterfalls in natural state in Finland Act on the Dam Safety 413/1984 Environemental policy Hydroenergy Safety aspect of construction and use of 95/2000 dams Act on the rights to use 266/1961 Energy policy Hydroenergy Permission to use, on certain conditions certain watercources Renewable energy sources water and watercources, and water Electricity constructions owned by someone else Decree on 283/1962 Environmental policy Biomass Concerns plants and activities which might precautionary 816/1989 Hydroenergy cause water pollution. measures for the 81/1995 Cogeneration protection of water Act on the natural 131/1991Environmental policy Biomass Conservation of natural resources, reserves of 11 named 138/1991 Hydroenergy formation of natural reserves areas Act on the 676/1981 Environmental policy Biomass Conservation of different kinds of wetland establishment of certain 851/1982 Hydroenergy areas state-owned areas Act on the 83/1938 Environmental policy Biomass Conservation of natural resources, establishment of certain Hydroenergy formation of natural reserves nature reserves on Wind energy state-owned lands Solar energy Cogeneration Act on the 634/1956 Environmental policy Biomass Conservation of natural resources, establishment of certain Hydroenergy formation of natural reserves new nature reserves on Wind energy state-owned lands Solar energy Act on the exceptional 703/1983 Environmental policy Hydroenergy Conservation of natural resources protection of the rivers 1139/2000 Ounasjoki and Kyrönjoki EMISSIONS AND PERMITS Environmental 86/2000 Environment All renewables The act compiles all separate provisions protection act and 169/2000 under one act, that is, the overriding decree 711/01 principles, responsibilities and prohibitions, 113/2000 overall regulations and guidelines, 436/01 compensations, supervisions and monitoring, and appeals Council of state 537/1984 Environmental policy Cogeneration The limits of maximum levels of pollutants decision on the Energy policy Biomass in the air, SO2, particulates, nitrogen oxides, CO instructions for air quality B1 LAW OR REGULATION Council of state decision on guidelines for restriction of SO2 emissions from peat fired boilers Council of state decision on restricting emissions of sulphur compounds from pulp mills Council of state decision on guidelines to restrict the particulate emissions of power and boiler plants Council of state decision on guidelines to restrict nitrogen oxide emissions from boilers and Gas turbines Council of state decision on the measures for air pollution prevention at plants combusting municipal wastes NUMBER MAIN SUBJECT FIELD AFFECTED REMARKS 367/1994 Renewable energy sources Electricity Cogeneration Energy policy Biomass Cogeneration Sulphur dioxide emission limits for peat combustion 160/1987 Electricity Cogeneration Energy policy Environmental policy Cogeneration Sulphur emissions from combustion of black liquor 157/1987 368/1994 Environmental policy Electricity Cogeneration Energy policy Biomass Cogeneration Power and boiler plants, also peat and other biomass fueled plants 527/1991 Electricity Cogeneration Energy policy Environmental policy Biomass Cogeneration RES connected to the grid Power and boiler plants, peat and other biomass fueled plants included 626/1994 Energy policy Environmental policy Electricity Cogeneration Urban solid residues Agricultural residues Conserns municipal waste incineration plants the share of energy produced with municipal waste exceed 30 % of the total Waste act and decree 1072/1993 91/2000; 1390/1990 171/2000 126/2000 1246/1996 962/1997 883/1998 Council of state decision of certain types of waste WASTE HANDLING, HEALTH PROTECTION AND BUILDING Energy policy Biomass Handling and processing of wastes Environmental policy Cogeneration Environmental policy Waste 861/1997 Environmental policy Waste 763/1994 1280/19948 9/2000 132/99 895/99 132/99 Health and safety Biomass cogeneration Building industry Act on certain neighbourhood relations 26/1920 90/2000 Building industry Wind energy Hydroenergy Biomass Cogeneration Wind energy Biomass Cogeneration Land use and building act and decree 132/1999 895/1999 Building Council of state decision of landfill gas Health protection act and decree Land use and Building act and decree All B2 The principle of the producer responsibility to minimise the generation and and to enhance the recovery (including also energy recovery) of certain types of waste The Government decisions on discarded tyres (1246/1996), packing and packaging waste (962/1997/ and waste paper (883/1998). Obligation to collect and use landfill gas and control (plan before year 2002) Permission for siting required for heat or power plants of >5 MW fuel power Regulation and restriction of the use of land areas and construction of buildings Regulates the construction of certain buildings (including wind mills) and storage areas nearby the neighbours residence or real estate Regulation and restriction of the use land areas and construction buildings. LAW OR REGULATION Excise tax act Waste tax act NUMBER FISCAL MEASURES AND SUBSIDIES MAIN SUBJECT FIELD AFFECTED 1260/1996 1261/1997 510/1998 Fiscal Electricity Wind energy Hydro power Biomass Cogeneration 495/1996 Environmental policy Biomass Cogeneration Solar energy Wind energy Hydroenergy Biomass Cogeneration RES connected to grid Solar energy Wind energy Hydro power Biomass Cogeneration RES connected to the grid Council of state 45/1996 decision on the general 29/1999 terms for energy 625/2002 subsidies Energy policy Financial Ministry of Trade and 746/1994 Industry decision on the 197/1994 terms of the energy 210/1999 subsidies Energy policy Financial Guidelines for energy investment aid 1607/1991 1051/1992 1086/1993 241/1996 Financial Act of Local Forestry Management associations 534/1998 and Decree 1227/1998 Forestry Act on Local Forestry Centres 1169/1993 93/1993 1525/1993 699/1993 1093/1996 amendm. 1178/1997 137/99 Other (Forestry) Biomass Renewable energy sources Forestry Biomass Forest act Wind energy Hydro power Biomass Cogeneration FORESTRY AND AGRICULTURE Biomass B3 REMARKS CO2 tax for fossil fuels (18 EUR/CO2 tonne) exceptions for peat and natural gas. The subsidies are granted for small-power plants producing power with wind energy, with hydro power plant (P>1.0 MW) or thermal power plant producing power with wood fuels or peat (< 40 MVA) Waste fees for dumping. For tasks promoting: energy conservation and energy use, utilisation of new energy technology, reduction of environmental impacts of energy production and use, improve the reliability and versatility of energy supply For investments and equipment promoting efficient production and use of energy, improving the reliability and versatility of energy supply, serving the reduction of environmental impacts of energy production and use, investments and equipment based on new energy technology, investments on utilisation of indigenous energy sources, investments promoting the use of natural gas and other gaseous fuels, and research on energy technologies (in Finland or abroad) serving the Finnish energy supply, environmental protection or transfer of energy technology Investment aid for heat and power generation Task of the Local Forestry Management Associations are to help forest owners (non-industrial) for economical, ecological and social sustainable of forestry with in Finnish legal system. Associations are collecting forest fees from forest owners. Forest owners are directly members in the association. Associations can trade timber or energy wood,when authorised by a forest owner. Act determining the tasks and activities of the Local Forestry Centres (inspection of the forestry legislation) Promotes the sustainable forestry and utilisation of forests. LAW OR REGULATION Act and Decree on funding of sustainable forestry Decisions of the Ministry of Agriculture and Forestry on harvesting of young forests Act and Decree for agricultural industry Act of funding rural business Decision of Ministry of Agriculture and Forestry for support system for crops and set-aside areas in 1999 NUMBER MAIN SUBJECT FIELD AFFECTED REMARKS Act: 1094/1996 1286/97 454/99 332/99 718/99 1062/99 144/00 Decree: 1311/1996 907/1997 1415/1997 454/1999 332/1999 718/1999 1062/1999 188/2000 729/2000 350/2001 31/2001 399/2001 72/2001 49/1999 50/1999 51/1999 66/1999 147/1999 Renewable energy sources Financial Biomass Funding of sustainable forestry Forest Improvement Act (140/1987), Act on the Rehabilition of Poorly Productive Forests in Lapland (1057/1982). Support for forestry operations in young stands STIPULATIONS FOR ENERGY WOOD PRODUCTION 907/1997 and 1415/1997 support also available for wood fuel harvesting and forestry transportation for forest owner as of 30.9.1997 Announcement 1083/1999 and stipulation (147/1999) of Ministry of Agriculture and Forestry, support for chipping of whole trees from young stands for year 2000 – 2002 Support is paid to the organisation or forest owner who is delivering chips to plant.. Financial Biomass (supports act 1094/1996) Biomass 1295/1990 248/1991 329/99 1257/99 44/00 149/01 329/1999 44/2000 320/2000 794/2001 485/1999 Agricultural policy Renewable energy sources in agriculture Announcement of Ministry of Agriculture and Forestry 522/1999 for 49/99,50/99 and 51/99 Financial support for forest owners to making forestry operations in young stands. Announcement of Ministry of Agriculture and Forestry 588/1999 for 69/99 Announcement of Ministry of Agriculture and Forestry (1083/1999) for 147/99 Fiscal measures for agriculture including also investment aid for energy production by RES in agriculture Max. 20% of the investment costs Agriculture policy Renewable energy in agriculture Agricultural policy Crops B4 Support for rural business by investment aid and loans. Includes also support 20% of investment costs to renewable energy investments, too. Support of crops and regulations for set a side areas in Finland in 1999 Complies with EU 1765/92 legislation LAW OR REGULATION Electricity Market act, Electricity market decree NUMBER ELECTRICITY MARKET MAIN SUBJECT FIELD AFFECTED REMARKS 386/1995 1018/1995 332/1998 138/1999 466/1999 518/1995 Standard usage figures 491/1998 906/2000 Energy policy Electricity Electricity production Transmission and distribution Deregulation of electricity markets Electricity Sales Act and Degree of Energy Market Authority Ministry of Trade and Industry decision on the terms and conditions applied to electricity sales Act on Competition Restrictions 507/2000 621/2000 Electricity 781/1995 613/1998 836/2000 905/2000 Electricity Energy markets including also natural gas markets Electricity sales *491/1998 is for smaller consumers (main fuse size 3 x 63) based on standard usage figures (type loads) See natural gas act (50(/2000) 480/1992 article 11d Competition restrictions in electricity transmission Electricity Fiscal Electricity Cogeneration Fiscal Electricity Biomass Decisions of the 1261/1996 Ministry of Trade and Industry, own use of electricity by power plants Definition of the 15/1998 electricity production by using wood and woodbased fuels B5 Terms of conditions applied to power grid connections and electricity sales The amount of electricity transmitted at 400 V in the transmission grid exceeds 25 per cent on a national level Definition of the own use of electricity by power plant. Electricity tax of industry is based on the used net electricity, and the own use of electricity by power plants can be subtracted from the other consumption. Additional to the Excise tax act C. Use of wood in Finland in 2000, Mm3 Round wood 75 Crown mass 28 Logging residues 26 Wasted round wood 6 2 Biofuels 0,4 Stem- Incremental, outside wood 5 commercial use Natural loss Crown mass 2 7 Timber export Fuel wood 5 1 2 Changes in timber storages Import 11.9+1.0 Domestic wood 58.0 Round wood + chips Sawn goods 13.5 Biofuels 4.4 Plywood industry 3.4 Sawing industry 29.4 11.2 Biofuels 0.7 Chips 1.3 Chips + sawdust 11.5 Mechanical and semi-chemical pulp industry Round wood + chips 10.5 + 2.9 26.2 + 9.8 Plywood 1.2 Other industry 0.4 + 1.1 Biofuels 0.02 Chemical pulp industry Biofuels 2.2 Chemical pulp 14.7 Black liquor 17.7 Solid biofuels 3.6 Source: VTT Processes/18/ C1 D.Costs and competitiveness of biofuels D1. Development of wood fuel prices in Finland as of 1982 /24, 25, 62, 63/ 1995 EUR/MWh 1999 2000 2001 12.00 10.00 8.00 6.00 4.00 2.00 0.00 Bark Sawdust Ind.wood residues Forest chips,average Wood fuel on average EUR/MWh 18.0 16.0 14.0 15.8 1982 1995 1999 15.0 13.8 12.0 14.3 13.6 11.1 10.4 10.3 10.0 9.1 8.9 7.7 8.0 7.4 6.0 4.0 2.0 0.0 Small stems delimbed Small stems undelimbed Logging residues D1 Forest chips average D2. A typical cost structure of forest chips from logging residues and small whole trees. Cost at the plant excluding VAT. No stumpage included /24/. Cost, € / MWh 14 12.8 Overheads 12 On-road transport 10 8.4 8 Comminution 6 Off-road transport 4 Cutting 2 0 Residues from final harvest Whole trees from early thinnings D3. Price development of wood chips from 1990. Source: Electrowatt-Ekono. 18 EUR/MWh 16 14 Primary product deduction 12 10 8 6 4 2 0 1990 1992 1994 1996 1998 Year D2 2000 2002 D4. Heat production costs for 5 MWth district heating plant. Source: Electrowatt-Ekono. 40 Heat production costs, EUR/MWh 13.5 EUR/MWh 14 EUR/MWh 10 EUR/MWh 7.6 EUR/MWh 50% ind. residues 50% forest chips Taxes and fees according to the proposal for the year 2003 Peak duration hours 5000 h Natural gas Heavy fuel oil Wood Peat Wood Heat plant 5 MW 35 Capital costs Other production costs 30 Taxes and other fees Fuel price without taxes 25 20 15 10 5 0 Natural gas Wood Heavy Wood 50%/ fuel oil Peat 50% D5. Electricity production costs for small-scale CHP plant in 2002. Heat production price is fixed to 20 EUR/MWh. Source: Electrowatt-Ekono. Electricity production costs, EUR/MWhe 60 50 40 Natural gas motor 5 MWe /6 MWth Wood and wood/peat 2 MWe/6 MWth Other costs Subsidies Fuel without taxes Market price of electricity 13.5 EUR/MWh 10 EUR/MWh 7.6 EUR/MWh 50% ind.residues 50% forest chips Taxes and grants according to the proposal for the year 2003 Peak duration hours, 5000 h Natural gas Wood Peat Wood 30 20 10 0 -5 Natural gas Wood 50%/peat 50% D3 Wood D6. Electricity production costs for large-scale CHP plant in 2002. Heat production price is fixed to 20 EUR/MWh. Source: Electrowatt-Ekono. Electricity production costs, EUR/MWhe Natural gas combined cycle 120 MWe /120 MWth Coal/wood/peat 60 MWe/120 MWth 40 Other costs Taxes and fees Fuel without taxes Market price of electricity 30 13.5 Eur/MWh 5.4 Eur/MWh 10 Eur/MWh 7.6 Eur/MWh 75% Ind.wood residues 25% Forest chips Taxes and subsidies according the proposal of the year 2003 Peak duration hours, 5000 h Natural gas Coal Wood Peat Wood 20 10 0 Natural gas Wood 50%/Peat 50% Coal -5 D7. Electricity production costs in 2002 for condensing power plants. Source:Electrowatt-Ekono. Electricity production costs, EUR/MWhe 50 40 Natural gas combined cycle 400 MWe Natural gas Coal Coal 500 MWe Wood Wood/peat 150 MWe Peat Wood Capital costs Other production costs 13.5 EUR/MWh 5.4 EUR/MWh 10 EUR/MWh 5.7 EUR/MWh 75% ind.wood residues 25% forest chips Taxes and grants according to the proposal for year 2003 Fuel price without taxes 30 20 10 0 Natural gas Coal -5 D4 Subsidies Wood 50%/Peat 50% D8. Competiviness of wood/peat in electricity production in 2000 – 2010. Source: Electrowatt-Ekono. 45 EUR/MWh e 40 35 Wood/peat condensing power Electricity pool, bad hydrological year 30 25 Electricity pool Wood/Peat CHP 20 Electricity pool, good hydrological year 15 10 5 0 2000 2001 2002 2003 2004 D5 2005 2006 2007 2008 2009 2010 App. E. Wind turbines in Finland 2002 Total 64 turbines, 41 MW. Source: VTT Processes /45/. Utsjoki Lammasoaivi 2 x 450 kW, 600 kW Ivalo Paljasselkä 65 kW (demo) Olos 5 x 600 kW Pyhätunturi 220 kW (dismantled 2001) Rovaniemi Kemi 3 x 300 kW Kuivaniemi 500 kW, 6 x 750 kW Ii 500 kW Oulu 1 MW Hailuoto 2 x 300 kW, 2 x 500 kW Lumijoki 660 kW, Kemi Oulu Oulunsalo 1.3 MW Siikajoki 2 x 300 kW, 2 x 600 kW Kalajoki 2 x 300 kW Korsnäs 4 x 200 kW Kajaani Vaasa Närpiö 750 kW Kuopio Joensuu Jyväskylä Pori 300 kW, 8 x 1 MW, 1x2MW Tampere Pori Uusikaupunki 2 x 1.3 MW Finström 2x500 kW,600 kW Vårdö 500 kW Eckerö 500 kW Lahti Turku Helsinki Lemland 4x600 kW Föglö 600 kW Sottunga 225 kW Lappeenranta Kotka 2 x1 MW Kopparnäs 50 kW (dismantled 2001) Kökar 500 kW Hanko E1 Published by Series title and number OPET FINLAND VTT Processes P O. Box 1603, FIN-40101 Jyväskylä Motiva Oy P.O.Box 489, FIN-00101 Helsinki National Technology Agency, Tekes P.O. Box 69, FIN-00101 Helsinki OPET Report 9 PRO2/T6509/02 Author(s) Alakangas, E. Title Renewable energy sources in Finland, 2002 Abstract Approximately 30% of Finland’s total energy consumption is met by using indigenous energy sources. Wood, hydropower and other biomass accounted for roughly 25% of Finland energy supply in 2000 (1 318 PJ). This is one of the highest figures among the leading industrialised nations (EU average being 6%) and makes Finland the leading country in the use of biomass. Bioenergy is accounting for 85% of renewable energy sources (328 PJ) in 2000. In Finland, the main provider and user of wood-based energy is the forest industry, which obtains wood fuels at a competitive price in connection with raw material procurement or as a by-product of wood processing. About 35 million m3 solid of wood (271 PJ) is used annually in Finland for energy production, covering 20% of the total consumption of primary energy. Most of the wood-based energy is recovered from liquid and solid industrial wood residues. Forest fuels comprise only a modest share. Increasing the use of renewable energy sources is one of the main objectives of the National Climate Strategy. Measures aimed at achieving this goal are presented out in the framework of the Action Plan for Renewable Energy, and should culminate in approximately one quarter of the total reduction target of Finland’s greenhouse emissions in 2010. The objective in energy use is to bring an increase of about 50% in the use of renewable energy by 2010 compared to that in 1995. The Action Plan for Renewable Energy given by the Finnish Ministry of Trade and Industry in 1999. In 2002 revised Action Plan for Renewable Energy for 2003 – 2006 the working group sets the objective of increasing the use of renewable energy sources by another 7% by 2010. The greatest potential in this regard lies in the increased use of wood for heat production and for combined heat and power production in both industry and the municipal district-heating sector. Key promotion measures are development of technology and commercialising of new technology, energy taxation, investment subsidies, and dissemination of information. Investment subsidies are targeted primarily at production plants employing new technology solutions. This report is a summary of the current situation and future plans of renewable energy sources in Finland. Keywords Renewable energy sources, Finland, bioenergy, biogas, wind energy, solar energy, hydro power, heat pumps Year 2002 Language English Name of project OPET Network (NNE5/2001/579 – SI2.318334) Pages Commissioned by Tekes, National Technology Acengy C1SU00393 Additional information Eija Alakangas, Product Manager Tel. +358-14-672 550 Fax +358-14-672 598 E-mail: Eija.Alakangas@vtt.fi Price 51 + app. 20 p. Available as PDF-format www.tekes.fi/opet