Forests | Expert: We’ve been warned about this for at least ten years – Now Finland is threatened with billions due to carbon sinks

Finnish may have to buy carbon sinks from other EU countries, which could mean a 0.8–2.0 billion bill for taxpayers, estimates the environmental advisor of the Ministry of the Environment Tuomo Kalliokoski .

“It’s about taxpayers’ money. This is a conscious transfer of income to a certain sector,” says Kalliokoski, referring to forestry.

We have to go shopping because Finland has released more carbon dioxide into the air than it has in the EU in the LULUCF Regulation involved. In relation to the carbon dioxide binding capacity, too much forest has been cut down in Finland due to industry, construction and agriculture. Cutting down forests has increased, but the growth of trees has slowed down.

There are no official estimates of the magnitude and costs of the sink deficit. The price range is huge and the availability of sinks is unclear. So far, no EU country has priced its carbon sinks.

Leading expert of the Ministry of Agriculture and Forestry Lotta Heikkonen according to this is an exceptional acquisition. Currently, the ministry monitors the situation in other countries and holds discussions with other countries at EU meetings. However, according to him, it is not worth making hasty conclusions.

To the situation would not have had to if measures had been taken in good time in Finland to bind carbon dioxide from the atmosphere to the soil or trees. We have been warned about this for at least ten years, says Kalliokoski.

“We wanted to describe the situation as if it had come as a surprise. Can’t hide behind it. The knowledge base has also changed, but there has been enough information that reasoned political decision-making could have been made.”

Kalliokoski reminds that in 2014 a parliamentary agreement was reached on increasing logging, even though then and again in 2017, for example, scientists warned that increasing logging endangers increasing sinkholes as part of the climate goals.

“Domestic climate measures would have been more cost-effective than buying vague carbon sink units from, for example, Romania. It is justified to ask whether this was a smart move from the point of view of climate policy goals?”

Finland the problem was a new calculation method a couple of years ago, in which peatlands drained from forests are considered as emission sources. Previously, they had been considered carbon dioxide binders.

“The big shock was that what were previously thought to be sinks were indeed emission sources,” says Heikkonen.

In Finland, it has been believed that sinkholes would withstand logging better. The next price was also imagined to be significantly cheaper.

The forest industry is a big factor in the sink issue. It ultimately determines how the annual sinks fluctuate according to the fellings.

“In Finland, there are no control measures that could be used to intervene in market manipulation. We are at the mercy of the market”, Chairman of the Climate Panel Jyri Seppälä says.

It’s a political decision. The promotion of forestry has been seen as so important for the national economy that they have been ready to cut down, says Heikkonen.

What what happens next in practice?

The five-year review period will last until the end of next year. In 2027, the final figures will be known, when it will be clear how much of a sink deficit Finland will have to purchase carbon sink units.

According to Kalliokoski, it would already be important to assemble a cross-administrative working group that would promote the issue and negotiate with the member countries from which carbon sink units would possibly be purchased.

If Finland cannot cumulatively keep the emissions and sink balance of the land use sector at the target level within the review period ending next year, the sink deficit will be transferred as a calculated emission reduction burden to the burden-sharing sector, which includes transport and agriculture, among others.

There, in addition to additional measures, it is possible for Finland to buy emission reduction units from other states, but they are likely to be more limited. That year it would probably be more expensive than the purchase of carbon sink units.

If the burden-sharing sector did not make up the shortfall, the matter would move to the next EU term. In that case, the sink deficit would be compensated by an additional eight percent emission reduction target, as if as a fine.

Climate panel Chairman Jyri Seppälä considers purchases from member states that fulfill their goals, be it sink units or emission units, to be very problematic. There is no guarantee of their availability, and they do not fix the problem, but postpone it further.

“If we go down the path of buying, we will be there constantly. It cannot make sense for the national economy in the long run.”

He points out that the EU’s climate goals are getting tighter all the time, so emission reductions are coming one way or another.

Seppälä also highlights a possible image disadvantage for Finland. Finland is committed to the goal of being carbon neutral by 2035. For example, EK has made a report on the connection between green investment opportunities and climate goals.

“We wanted to profile ourselves as a pioneer. Finland has been an attractive place because we have achieved our goals. Now there may be reputational damage ahead.”

Finland’s situation has been explained by the fact that domestic felling has had to be increased when, due to the sanctions imposed due to the war in Ukraine, the import of wood from Russia has stopped. It has been rumored that Finland would get relief in its goals. Seppälä cannot say how much the EU is ready to come against Finland because of the situation. He hopes to get real information about the matter.

Heikkonen of the Ministry of Agriculture and Forestry says that the situation has been discussed with the commission.

In addition to logging, the land use sector is important in how emissions from peatlands and deforestation can be controlled. In Seppälä’s opinion, the matter cannot be handled in such a way that the emission reductions of peat fields are piled on the shoulders of farmers.

“Society’s task would be to resolve the matter in a fair way, but there is no political courage to do so.”