Carbon neutrality in the Finnish energy sector: prospects for a fossil‐fuel phase out

Abstract

The Finnish government has set a target of reaching carbon neutrality by 2035 and renewable energy is playing an increasingly important role in the Finnish energy sector. Bioenergy from forest biomass is currently the most utilized renewable energy resource. European Union regulations are imposing limitations on the use of forest biomass for environmental reasons, however, and the energy sector is having to look for alternative renewable energy options to reach carbon neutrality. This paper reviews the latest changes in the energy industry in Finland and evaluates prospective renewable energy development and fossil fuel replacement in the future Finnish energy system. The study shows that only a combination of all available renewable energy forms can enable the carbon neutrality target to be achieved by 2035. There is a good possibility that Finland can replace fossil fuels fully in the energy sector; wind energy will increase its share of electricity production, and biomass will continue to play a crucial role in the heating sector. Industry and the transport sector, however, face greater challenges and should be studied in more detail.