FINLAND Law and Practice Contributed by: Kari Marttinen, Laura Leino, Outi Iso-Markku and Aino Lahti-Nuuttila, Erottaja Attorneys Ltd
13. Climate Change and Emissions Trading 13.1 Key Policies, Principles and Laws The key legislation in connection with climate change and emissions trading is: • the Climate Act (No 423/2022) ( ilmastolaki ); and • the Emissions Trading Act (No 1270/2023) ( päästökauppalaki ). 13.2 Targets to Reduce Greenhouse Gas Emissions Carbon Neutrality The Climate Act’s primary goal is to ensure a signifi- cant reduction in greenhouse gas emissions and an increase in the removals by greenhouse gas sinks, with the target of achieving carbon neutrality by 2035. This means that Finland aims to reach a point where its greenhouse gas emissions are equal to the removals. The Climate Act also aims to ensure that greenhouse gas emissions from the effort-sharing and emissions trading sectors decrease by at least 60% by 2030, at least 80% by 2040 and at least 95% by 2050 com- pared to 1990 levels. The Climate Act applies to the government authorities in the preparation of climate policies and in ensuring their implementation. It does not impose direct obligations on operators. Emissions Trading Act and Act on Emissions Trading of Fossil Fuel Distribution Finland has its own emission trading system, which is based on the Emissions Trading Act. The purpose of the Emissions Trading Act is to promote the reduc- tion of greenhouse gas emissions cost-effectively and economically. Amendments to the Emissions Trading Act will enter into force on 1 January 2026. The key amendments include the transition to use fuel effi- ciency in determining total capacity and taking in to account combustion units that use only biomass in calculating total capacity. The amendments may bring new plants within the scope of emissions trading. The Act on Emissions Trading of Fossil Fuel Distribu- tion ( laki fossiilisen polttoaineen jakelun päästökau- pasta ) came into force on 1 January 2025 introducing a new emissions trading system for fuels, covering
for instance fuels used in road transport and separate heating of buildings. Coal Ban The Act Banning the Use of Coal for Energy (No 416/2019) ( laki hiilen energiakäytön kieltämisestä ) pro- hibits the use of coal as fuel for the production of elec- tricity or heat from 1 May 2029. The Act Banning the Use of Coal for Energy is supported by the Govern- ment Decree on Investment Aid for Projects Replacing Coal for Energy Use in 2020–25 (No 129/2020) ( val- tioneuvoston asetus hiilen energiakäyttöä korvaavien hankkeiden investointituesta vuosina 2020–25 ), which aims to promote the voluntary, accelerated phasing- out of coal. The aim of the legislation is to ensure that power plants or heating investments or replacement investments that rely on coal energy are no longer viable. The use of coal in Finnish energy production ended during 2025 as the last coal-fired power plant units were closed. 14. Asbestos and Polychlorinated Biphenyls (PCBs) 14.1 Key Policies, Principles and Laws Relating to Asbestos and PCBs Asbestos In Finland, the use of asbestos became licensed in 1988 and was banned in 1993 (as it was in the EU in 2005). The use of crocidolite was banned in 1976. In general, if it does not cause health or environmental hazards, there is no direct obligation to remove asbes- tos that is lawfully contained in products or structures. Asbestos removal work can only be carried out by pri- vate persons or legal persons such as limited compa- nies, co-operatives and public entities that have been authorised to do so. PCBs The manufacture, use and importation of PCBs is prohibited in Finland. The Council Directive on the disposal of polychlorinated biphenyls and polychlo- rinated terphenyls (96/59/EC) aims to ensure the safe disposal of PCBs and of the equipment containing PCBs by imposing certain obligations on EU member states.
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