Mundus Nordic Green News – 13 November, 2020

Business Finland presents national hydrogen roadmap

Finland's goal to be carbon neutral in 2035 is one of the most ambitious in the world. There is no separate hydrogen strategy in Finland, but hydrogen is seen as part of a whole national energy and climate strategy. Although several Finnish industrial sectors have worked on their own hydrogen roadmaps, until now there has not been a national view of the role of hydrogen in Finland's low carbonation. Hence, Business Finland commissioned VTT, the Technical Research Centre of Finland to compile of a national hydrogen road map.

 

The roadmap identified that the country has good wind resources, both offshore and onshore, allowing an increase in the production of renewable electricity, essential for production of low carbon hydrogen; a robust electricity grid to support increased transmission of power; and an established hydrogen value chain, as well as decades of experience in large-scale industrial use of hydrogen.

 

Helena Sarén, Head of Business Finland's Smart Energy Program said that, “As a small country, Finland cannot be a world leader in the entire value chain. It is essential to identify those parts of the value chain in which we can play a significant role in the future”. The Hydrogen Roadmap identified our potential in particular as the production of synthetic fuels, the cost-effective and low-carbon production of hydrogen, the production of low-carbon steel and the reduction of logistics costs in our industry. In addition, various cross-industry holistic energy circular economy solutions were seen as our strengths. It’s expected the roadmap will serve as a knowledge base for further work, such as shaping the hydrogen policy for Finland and determining the role of hydrogen in the national energy and climate policy.

 

Download the report in English

 

Swedish politics the biggest obstacle to major industrial changes

New research from Stockholm Sustainable Finance Centre on a low-carbon transition for different industrial sectors reaches a surprising conclusion: the chief barrier to industrial transition is not a lack of capital, but the absence of clear policies on incentives for green transitions linked to biofuels for transport, waste management and carbon capture and storage.

 

The report by researchers from Stockholm Environment Institute, host organization for Stockholm Sustainable Finance Centre, shows that it will not be especially demanding to meet the investment needs for decarbonizing heavy industry in Sweden: around SEK 66 billion of investments additional to those needed to maintain current production levels, using existing technologies, would be required. Capital needs to decarbonize industry through to 2045 are thus a little more than one-tenth of the planned transport infrastructure effort over the coming decade.

 

The report shows large differences in how much the production costs increase in each sector as a result of net-zero transition. Increased production costs must be covered by either higher prices (which would mean that consumers would need to pay a higher price for reduced emissions), or new policy measures that would cover the additional costs, or by increasing the price of emissions. 

 

However, the real barriers to decarbonizing heavy industry are not financial; they are linked to policies, regulations and technological development. From a business perspective, uncertainty about long-term policies make investments in transitioning risky. Clear and long-term policy frameworks reduce uncertainties and allow actors to better see what investments will be economically viable.

 

Download the report in English

 

Swedish clean energy rulemaking highlights political risks

Underling the problem, this week the Swedish Parliament passed a bill to end the electricity certificates support scheme on December 31st 2021. This follows several years of change and haphazard policy making which caused a vast oversupply of electricity certificates and the subsequent 90% collapse in market price. Investors in biomass CHPs (Swedish utilities) small scale hydro and wind farms (mainly pension funds and other institutional money) have lost billions. However consumers have benefited from lower power prices and green energy. The story highlights the risks of investing in politically driven markets an issue further highlighted by the Financial Times, which looks at similar disappointment in France’s solar schemes.

 

Cloudberry announces that it is engaged in a material M&A transaction for renewable assets

Cloudberry Clean Energy AS, a Nordic renewable energy company, which owna, develop and operate hydro power plants and wind farms in Norway and Sweden, announced that it is engaged in a material M&A transaction for Nordic renewable assets. The acquisition would entail a substantial capital need and Cloudberry has therefore engaged with selected investors to explore the potential to underwrite the equity financing required for the transaction. Cloudberry has retained Carnegie, Pareto Securities and SEB as Managers in the potential transaction.

 

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