Opening remarks by Minister for Foreign Trade and Development Anne-Mari Virolainen at the Business Finland’s and International Renewable Energy Agency’s joint workshop in Helsinki, 26 April 2018.
Ladies and gentlemen,
I am honoured to open this Business Finland’s and International Renewable Energy Agency’s joint workshop on how to cooperate with International Renewable Energy Agency and how to use their products and services to support international business of the Finnish companies. I will briefly address climate change, international climate agreement and the investment needs it will cause globally. I am also going to talk about energy technologies as a business opportunity and the role of development policies in energy transition.
Climate change is a global challenge. Therefore, climate change must be solved in cooperation with all countries. Paris Agreement was a hugely important milestone in the process. Targets of Paris Agreement and beyond can only be achieved by utilizing clean technologies worldwide.
Finland has been a leader in clean energy technologies at home. We have reached our renewable energy targets in advance and the share of renewable energy is already over 40 % - among the highest in Europe. High share of renewables is not a coincidence. Several policy measures including for example investment aid, feed-in premium, blending obligation of biofuels and taxation have enabled investments to renewable energy technologies.
And we want to be even more ambitious. Current Government Programme sets ambitious targets for increasing renewable energy and decreasing the use of fossil fuels. For example, the use of renewable energy will be increased so that its share will rise to more than 50 per cent during the 2020s. This will be based, in particular, on the growth in the supply of bioenergy and other emission-free renewable energy. Furthermore, our Energy and Climate strategy for 2030 also determine that the use of imported oil for the domestic needs will be cut by half by 2030. Also the use of coal for energy production will be banned by a law in 2029.
New energy technology has been demonstrated in different scales with the help of energy aid for key projects. ("kärkihankkeet"). At the moment government is preparing regulation to ban use of coal in energy production. These kind of policies will support usage of clean energy technologies in Finland even further.
I want to stress, that properly working energy markets are key to success in promoting clean technologies. In fact different renewable energy sources are already competitive in markets without subsidies or at least closer to be competitive than before. Nordic electricity market has long been a successful model to enable cost-efficient, transparent and sustainable energy sector in Nordic countries. And market development becomes even more crucial when share of variable renewables such as solar and wind is rising.
Ladies and gentlemen,
Decarbonization of energy systems globally means a huge business opportunity for the Finnish companies. IRENA estimates that reaching 2 degree Celsius target would require additional 29 trillion USD investments between 2015-2050 compared to a reference case. We have to work together to catch a share of this for Finland also.
By commercializing our best solutions abroad, we can be bigger than we actually are in the battle against climate change. This would mean that our technologies would help to reduce emissions globally instead of reducing emissions only in own country.
Finland has globally leading expertise in several areas of energy technologies. Biofuels, bioenergy and energy-efficient heating solutions are the traditional strengths. Strong knowhow of intelligent energy distribution and demand-side solutions is an increasingly important advantage in the digitalized world. Finland also has strong expertise in various energy production technologies.
In fact I am pleased to see how most of the Finnish energy technology companies have been investing in low-carbon solutions. Many of our solutions can actually be unavoidable to others when they are moving towards the Paris Agreement targets.
Finland is an active member in several international organizations and platforms such as International Renewable Energy Agency (IRENA), International Energy Agency (IEA), Clean Energy Ministerial (CEM) and Mission Innovation (MI). These platforms also enable deployment of clean energy technologies by facilitating cooperation and knowledge transfer.
Ladies and gentlemen,
Business Finland was formed in January 2018. Mission of the organization is to help Finnish companies, including clean energy companies to grow abroad. One concrete instrument to boost business opportunities is cooperation with Smart Energy Program, which operates under Business Finland. I am sure that Business Finland team is ready to work with all companies seriously aiming to global markets.
Finland has traditionally been a strong investor to "green innovations" We have been highly ranked in different indicators and comparisons worldwide. In the future we have to work even harder in innovating new technologies.
The Finnish Government can help our clean energy companies to know their markets even better. Government can also use its authority and "prestige services” (arvovaltapalvelut) to smoothen the companies’ way forward in foreign countries. Colleagues working for Finland in embassies and Business Finland offices around the world can help companies in this work.
Ladies and gentlemen,
Before concluding, I would like to say few words about development cooperation. Climate change is taken into account in all of Finland’s development cooperation efforts.
Promotion of sustainable energy is fundamentally important for climate change mitigation. Finland has supported the private sector in energy-sector development for decades through various instruments and partnerships.
Bilateral projects and concessional credits have been used to support energy infrastructure. Finnpartnership and Finnfund have an extensive portfolio of energy projects. The regional Energy & Environment Partnership (EEP) programmes provide early stage financial support to companies that provide clean energy services, and improve access to electricity and clean fuels in rural locations.
The Energy & Environment Partnership programme in Africa has now evolved into a Multi-Donor Trust Fund managed by the Nordic Development Fund (NDF). Over 250 projects have already been supported in Sub-Saharan Africa since 2010, and consequently, about one million African households now have access to improved energy solutions. We expect this excellent track record to continue under NDF’s management and encourage Finnish companies to apply for financial support. We expect the next call for proposals to open in May 2018.
Last year, Finland invested 114 million euros to a joint fund with the IFC. This Finland-IFC Blended Finance for Climate Fund is a concrete example of an innovative financing mechanism to mobilize private capital for climate.
"Blending is trending”, they say. By ‘blending’ we mean that Finland’s concessional financing is mixed on a project level with market based funding by IFC and other investors. The blending will allow IFC financing to projects that would not happen otherwise.
The fund will support renewable and clean energy solutions and climate projects in developing countries. Finnish companies that have concrete project proposals to combat climate change in developing countries could benefit from the fund as well. Many solutions that are commonplace in Finland like district heating or cooling, could bring substantial efficiency gains in developing countries.
With these words I welcome all of you to this workshop! I hope that the discussions and information that you receive today will be useful to you weather you do business in Finland or in the international context. Thank you!