The country has set a goal to stop using coal for power generation by 2029.
Finland’s coal consumption increased by 19% in 2021 compared to the previous year, according to data from Statistics Finland.
The country burned 50% more coal between July and September compared to the same period a year earlier, and a jump of 54% year-on-year in the last three months of the year.
There has been an increase in the use of coal for power and heat generation as well as manufacturing, particularly in the second half of 2021.
The colder winter has increased the demand for heating
A key driver of the sharp increase in coal consumption in Finland has been a drastic drop in temperatures in 2021 compared to the previous year. According to Statistics Finland, coal consumption was exceptionally low in 2020.
“There was hardly any winter in 2020, but 2021 had two winters: January-February and December were colder than usual, which increased the need for heat and therefore the consumption of fuel”, Jukka Leskelamanaging director of the energy industry trade association, Finnish Energy, explains.
Coal accounted for 11% of district heating and 4.5% of electricity generation last year.
While the share of coal in the energy mix has not changed, Leskelä points out that total electricity and heating consumption has increased in 2021, leading to an increase in overall coal consumption.
High natural gas prices have also pushed municipalities to use coal instead. “For several regions, the main alternative to coal was natural gas, which was very expensive. While natural gas was used more and coal less used at the start of the year, it was the opposite at the end of the year. ‘year.” says Leskelä.
Finland is experiencing ‘tech lockdown’
According to Karoliina Auvinenan expert from the Finnish Environment Institute (SYKE), while freezing temperatures are one of the reasons for the rise in the use of coal, Finland’s inability to switch from fossil fuels to alternative sources cleaner energy also plays a role.
Auvinen says several Finnish energy companies are in the throes of what she calls a technology lock-in.
“The district heating sector is currently facing a Sleeping Beauty-like coma, and no one had the foresight to invest in time in alternatives to coal-fired power plants. Now that colder winters have arrived, it more coal is needed because new energy capacity is not yet available. As long as capacity is lacking, there will be an increasing need for coal during cold winters,” she says.
Auvinen believes that energy companies should have invested in alternative energy sources much earlier, as the switch to cleaner solutions is a gradual process.
“Rising EU emission allowance prices have caught many off guard. The burden of costs will be borne by city dwellers who live in areas that use a coal-fired district heating system.”
Under the emissions trading scheme, companies in the EU must receive or buy allowances corresponding to their carbon emissions. The system allows the EU to set a price and cap on emissions, which incentivizes companies to switch to renewables.
Leskelä says the energy sector has systematically reduced coal consumption, while carbon emissions from power generation have declined rapidly.
“You can always say that we could have made changes more quickly, but it has been difficult to find alternative heating sources, especially for metropolitan areas, when there is no desire to increase the reliance on natural gas and that sustainable bioenergy production is limited,” he says. .
Coal use down overall
While a one-fifth increase in coal consumption may seem alarming at first glance, data from Statistics Finland shows that coal consumption in Finland is steadily decreasing over the long term.
According to the agency, total coal consumption was 56% lower in 2021 than the current millennium average consumption.
“The transition is underway at a breakneck pace. High EU emission allowance prices are boosting industry players in the heating and manufacturing sectors,” Auvinen notes.
Helen, the energy company owned by the municipality of Helsinki, has announced that it will close its coal-fired power plants in Hanasaari and Salmisaari in 2023 and 2024, respectively.
Additionally, a law completely banning the use of coal for power generation in Finland is expected to come into force in 2029. According to Leskelä, Finland is on track to meet its current climate targets.
“There is no indication that emissions from power generation will compromise climate goals. There is a strong downward trend [ in emissions],” he declares.
According to Statistics Finland, Finland’s coal reserves stood at 1.2 million tonnes at the end of December 2021, a decrease of 39% compared to the previous year. Coal consumption in the country peaked in 2003, declining by a quarter since then.