EU climate package will not boost green growth;
The European Commission published its 'Fit for 55' climate and energy package on 14 July. The package does not recognise the solutions provided by the forest industry to curb climate change. It is important to ensure that the details will be specified during forthcoming political process in a way that safeguards Finland’s competitiveness and boosts the climate benefits of wood-based products.
The purpose of the 'Fit for 55' package is to ensure that the EU’s greenhouse gas emissions will be 55 % lower in 2030 compared with 1990 levels. The package also aims to guide the EU towards its objective of climate-neutrality by 2050.
- The objective is important and shared by all. However, the forest industry believes that the newly published package does not allow for the best solution for the climate, let alone for industrial competitiveness, says Timo Jaatinen, Director General of the Finnish Forest Industries Federation.
The EU legal package has a large impact on the forest industry, which is an energy intensive field that processes natural resources sustainably and diversely, transports materials and products and acts on the global market. 'Fit for 55' does not adequately recognise the solutions provided by the forest industry to curb climate change. The industry produces innovative products from renewable resources and provides alternatives for products made from non-renewable raw-materials. EU regulation should not impede this positive development.
- The priority in the fight against climate change is to reduce fossil emissions and replace the products that cause the most emissions with products made from renewable resources, says Jaatinen.
What is particularly problematic about the contents of the package is that the EU’s newly adopted legislative acts are being reopened before they have even been appropriately applied.
After some long and hard negotiations, the sustainability criteria for forest biomass set out by the Renewable Energy Directive were finally agreed on at the end of the previous Commission’s term. The directive in force is only now being implemented, which means that we have no experience of the functioning of the criteria. This is why it is strange that the Commission is now proposing to change these criteria in such a substantial way. In Finland, wood is not grown for bio-energy – energy is created from the side streams of the forest industry as well as logging residues.
The Commission is proposing a strict, EU-wide carbon sink objective of 310 million tonnes of carbon dioxide by 2030. The measures taken in relation to the objective must increase forest growth.
- When industry investments are planned for decades to come, legislation should not be changed constantly. The EU Green Deal was supposed to be a programme for green growth. Uncertainty does not encourage the pursuit of the original goals of the programme. On the contrary, it is now becoming a regulatory package at best and putting the brakes on progress at worst, Jaatinen says.
- Insubsequent follow-up negotiations, it must be ensured that the sink objective proposed by the Commission or the compensation mechanisms do not lead to a situation where the fossil fuel emissions of other EU states or other sectors are overlooked at the expense of forested countries.
The inclusion of maritime transport in emission trade does not take into consideration winter maritime transport, which is important for Finland, despite the higher fuel consumption and emission levels of ships reinforced for ice. As such, emission trade is becoming a significant expense for the forest industry, where over 70%of production is exported and more than 90% of this is transported by sea. The forest industry considers it important that Finland ensures the competitiveness of export sectors during EU negotiations. The negotiations call for clear solutions and a willingness to mitigate the negative effects on competitiveness.
- Finland’s decision-makers must now ensure that the details will be specified in a way that safeguards the Finnish industry’s competitiveness and takes into consideration the climate benefits of the forest industry, Jaatinen stresses.
According to a recent study by Afry, an engineering, design and advisory services provider, the global forest industry market is set to grow in terms of both current products and new growing products. The market is estimated to grow from EUR 540 billion to EUR 715 billion by 2035. The forest industry’s success helps the EU reach its climate goals.