EU promises flexibility for Finland’s collapsed forest carbon sinks

EU Climate Commissioner Wopke Hoekstra says flexibility will be introduced into the calculation of Finland’s forest carbon sinks, potentially saving the country billions in costs, Yle reported on Wednesday.

Hoekstra said the calculations would take into account Finland’s increased domestic timber production after imports from Russia stopped. Imports ended when Russia launched its war against Ukraine.

“The border is closed, which means less wood is imported and Finland produces more of it. This must be taken into account in a fair way,” Hoekstra told journalists at an event in the Finnish Parliament in Helsinki.

Hoekstra said the decision on the carbon sink calculations was expected to be finalised by the end of this year or early next year. Similar discussions are also taking place with countries including Sweden, he said.

Finland has been concerned about the compensation it could have to pay for falling short of its carbon sink targets. Under EU climate law, Finland has committed to maintaining its forest carbon sink at a specified level. Current calculations indicate that the sinks will remain below that commitment.

The Finnish Climate Change Panel has warned that the shortfall could lead to costs running into billions of euros. The costs could include buying sink units from other EU countries that have captured more carbon dioxide than required. A change in the calculation method could allow Finland to avoid those costs.

The EU aims to increase carbon sinks by 2030, but the trend in Finland is moving in the opposite direction. Forest carbon sinks have collapsed because of logging and reduced forest growth. Finland’s forests are now only narrowly a carbon sink, which is not enough to meet the country’s climate targets. Earlier estimates indicated that the forests had become a source of emissions.

Commission also proposes emissions trading changes

The European Commission has also decided to propose easing the EU emissions trading system. The system requires industrial and energy companies to pay for the tonnes of carbon dioxide they release into the atmosphere. Emissions from sectors covered by the system have fallen by as much as one billion tonnes a year.

Hoekstra rejected the suggestion that the proposed changes would weaken the system. He said the reform would strengthen emissions trading and make it more practical.

“We are tightening the targets for shipping, aviation, negative emissions and carbon removals,” Hoekstra said.

He added that the commission would require companies receiving free emissions allowances to invest in reducing carbon dioxide emissions in Europe.

Finland has opposed easing the emissions trading system. Under the current level of reductions, emissions would have reached zero in 2039, but that is no longer expected because of the proposed changes.