ENTSOG GRIP BEMIP 2014-2023 / Main Report

2.2 Finland

ENERGY POLICY

In March 2013, a ministerial working group on energy and climate policy, appointed by the government of Finland, released an updated version of the national energy and climate strategy. Main objectives of the strategy update include ensuring that the national targets for 2020 are achieved and preparing of a roadmap towards meeting the long-term energy and climate objectives set by the EU. The strategy emphasizes the importance of enhancing cost-efficiency, greater energy self- sufficiency and ensuring the availability of sufficient and moderately priced electric power supply. Regarding the role of natural gas, the strategy states that approximately 10% of natural gas will be replaced with biomass-based solutions, which enable the re- placement of imported gas while utilizing the current gas pipelines and power plants. The strategy also outlines that replacement of around 10% of natural gas with SNG made from domestic wood by 2025 will be pursued and a plant for the production of SNG is listed among the biggest energy investments in the near future. Possible funding for a bio-SNG plant from the second round of NER300 funding or other EU sources of funding will be supported. The strategy also encourages construction of facilities that manufacture biofuel from domestic waste and forest-based raw materials will be promoted, along with the use of such fuels in transport as well as in heating. The strategy states that in order to enhance the functioning of the gas market, stability of gas prices and security of supply, the government should promote ar- rangements to create a competing gas supply. An LNG terminal project, to be locat- ed on the coast of the Gulf of Finland, and the Balticconnector project are included in the list of PCIs, and enable Baltic and / or Finnish parties to the project (com­ panies) to apply for the EU funding. The strategy points out that due to the small size of the market and national special characteristics, not all of the benefits normally linked to smart metering can be real- ized in Finland. Therefore, at this stage, it would not be expedient to promote the smart metering of natural gas deliveries through binding provisions. The updated energy and climate strategy explains openly the Government’s posi- tions, both in the EU negotiations and other relevant international contexts, as well as in domestic policy preparation and decision-making. In 2008, the International Maritime Organisation agreed on a revised version of the so-called MARPOL Annex VI, which sets the limits on sulphur oxide (SOx) and nitrogen oxide (NOx) emissions from ship exhausts. In 2012, the EU adopted a directive that requires the sulphur content in the fuel of vessels plying the Baltic Sea, North Sea and English Channel to be reduced to 0.1% in 2015. Also, the IMO’s Tier III environment protection rules for NOx reduction in defined Emission Control Areas (ECAs), will apply to ships keeled after January 2016. In order to meet the new environmental requirements, which apply to the above mentioned areas, emission reduction measures must be employed. Hence, the role of LNG as a marine fuel will be enhanced but major developments in LNG storage and bunkering terminals must be introduced. To encourage further development of LNG infrastructure, the Government of Finland has decided that investments in national LNG terminals will be supported by a total of 123million EUR during 2013 and 2014. The construc- tion of LNG terminals would enable a larger number of LNG-powered cargo and pas- senger vessels to operate on the Baltic Sea. Terminals would also enable transport of natural gas to locations outside the natural gas pipeline network, thereby increas- ing the diversity and reliability of energy supply, while helping to reduce emissions, particularly in the industrial sector where other fossil fuels are used.

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Baltic Energy Market Interconnection Plan GRIP 2014–2023