Confederation of Finnish Industries EK represents the entire private sector and has 24 member associations and 16,000 member companies. We speak for employers of all sizes, from public limited companies to SMEs. Our member companies create jobs and welfare in Finland, and are responsible for 70% of exports, 70% of R&D expenditure, 2/3 of the GDP created by companies and 2/3 of the private sector jobs.
Climate change is a huge global challenge on every level in societies. Confederation of Finnish Industries strongly supports the Paris agreement and 1.5-degree policies and is fully committed to the implementation of necessary measures to mitigate climate change. Enterprises are in the core of this long-lasting combat by innovating, investing and offering solutions globally. In the on-going energy transition, they change their processes away from using fossil fuels, and in the same time they face daily tough international competition.
We appreciate the possibility to deliver the views of Finnish Industries regarding the EU’s 2030 Climate Target Plan.
Finnish Industries support the climate neutrality target of 2050 of the EU, and we see that ambitious climate policy is essential and offers also opportunities to European companies in the area of clean technology. We have also supported the 2030 energy and climate framework and agreed legislation. When considering the increase of the 2030 target and revision (if appropriate) of all relevant legislation, there are severe concerns regarding the matter.
Most of all, the re-opening of the legislation will slow down the full implementation of the present legislation significantly. Member States, enterprises and investors will wait for the new regulation, which won’t be implemented nationally until about 2025. There is then only five years left for new measures to function before 2030. It would be better to focus now on the 2040 target, and the smooth implementation of the regulation.
Finnish Industries sees that the 2030 Climate Target Plan needs to be based on a proper and thorough impact assessment, which clearly indicates what the consequences with different options are, how to share the increased ambition between EU ETS and non-ETS sectors and what the economic influences are as well as the climate ones. In addition to these, the realistic timeline and content of the coming 2030 proposal needs to be assessed against the present enormous global COVID-19 economic and human crisis.
When assessing the present target and the figures of the 50-55% reduction target, it needs to be kept in mind, that the linear trajectory from now to 2050 is certainly not the only and most probably not the most cost-efficient path because the major emission reduction technologies and behavioural changes will develop in leaps, like the “invasion” of e-cars and hybrid steel production. Therefore, there are many other paths in addition to linearity to go to 2050 climate neutrality.
However, if the 2030 target is increased, the EU should consider using offsets (international mechanisms) to achieve cost-efficient emission reductions and to fulfill partly its ambitious climate target. There are already three Member States which are using offsets to reach their high national climate targets.
Finally, if the 2030 target is increased, the new emission reductions should be shared fairly and cost-effectively between ETS and non-ETS sectors. The competitiveness of European industry needs to be taken care of enforcing the carbon leakage prevention measures, like free allocation and indirect compensation within ETS. In the near future, coverage of ETS will
change when the main part of transport is electrified in Europe. Also, according to the Green deal communication road traffic, maritime and heating of buildings will perhaps be moved as whole new sectors to ETS. These changes will significantly influence the present structure of the EU energy and climate policy and they need to be taken into account in the 2030 Climate Target Plan.