Carbon dioxide emissions down in the commerce sector – carbon index used to monitor emissions trends in the sector

According to the energy accounts of Statistics Finland, the use of electricity and heat in the commerce sector increased slightly in 2018 compared to the previous year. The use of electricity increased by five per cent and that of heat by six per cent from 2017. Across all Finnish sectors, the use of electricity and heat increased by two per cent. The CO2 emissions of the commerce sector were up by one per cent, compared to two per cent for all sectors.

According to the carbon index* followed by the Finnish Commerce Federation, the sector’s CO2 emissions decreased by seven per cent in 2019. The data of Statistics Finland indicate that Finland’s overall emissions in 2019 were record low, decreasing by six per cent from the previous year. This decrease largely resulted from the consumption of fossil fuels declining by six per cent in Finland in 2019, coinciding with a decrease in the emissions from energy production.

In the future, the Federation of Finnish Commerce will use the carbon index on an annual basis to monitor trends in the CO2 emissions of the commerce sector. The carbon index was created as part of the Renewable Commerce 2035 roadmap, published in June, to help monitor the scenarios outlined in the roadmap and implement related measures.

The carbon index was created as part of the Renewable Commerce 2035 roadmap.

“We had to create the carbon index, because official sources did not provide adequate or detailed enough information for us to get an overall picture of the situation,” explains Bate Ismail, economist at the Finnish Commerce Federation, who was closely involved in developing the index.

“Now we can also compare real emissions figures to two of the scenarios presented in the roadmap: the basic track and the track of renewable commerce. The carbon index shows us whether the objectives of the commerce sector are being achieved and whether policy measures are effective enough,” Ismail explains.

The Renewable Commerce 2035 roadmap introduced three scenarios, which enable the Finnish Commerce Federation to follow changes taking place in the sector. In one of these, called the basic track, the present positive change, mainly relying on companies’ own actions, will continue, and carbon neutrality will be achieved in 2050. In the scenario for renewable commerce, the sector’s transition is supported by a reduced electricity tax rate, in addition to which commerce will launch its own small-scale production of renewable energy, which will considerably reduce the use of purchased electricity and heat. In this case, carbon neutrality can be achieved in 2035.

According to Ismail, the emissions generated in the next 15 years are as significant as the year in which the sector will turn carbon neutral. A faster decline in emissions is important for the achievement of Finland’s target of being carbon neutral in 2035.

“Comparisons of the scenarios enable us to assess the cumulative overall emissions in the next few years. According to these, the scenario for renewable commerce generates up to 30 per cent less emissions than the basic track,” says Ismail.

The commerce sector cannot achieve carbon neutrality alone – policy measures are needed

The direct emissions from commerce account for less than one per cent of Finland’s CO2 emissions. The sector has engaged in ambitious climate work for a long time, and companies have determinedly transferred to carbon neutral and renewable energy and power sources.

“It is important that we have policy measures supporting the positive development taking place in the commerce sector to reduce emissions,” says Mari Kiviniemi, Managing Director of the Finnish Commerce Federation.

The vision of the scenario for renewable commerce is to be carbon neutral in 2035, a full 15 years earlier than if the operating environment created by the public sector and policy measures remained unchanged, and to have almost zero emissions in 2050. However, the commerce sector cannot achieve this on its own.

“Finnish commerce needs incentives for investments and acquisitions, as well as new tax solutions that promote the cost competitiveness of companies in the commerce sector, and a fair competitive playing field in the global economy without borders,” says Kiviniemi.

“Finnish commerce has always operated in an international environment, and competition benefits our customers. However, fair and equal competition is a must,” Kiviniemi points out.

In addition, the Renewable Commerce 2035 roadmap proposes reducing the electricity tax for the service sector, supporting small-scale production of renewable energy, extending the obligations applicable to domestic players to international web platforms, as well as ensuring the long-term development of transport and infrastructure, climate-resilient land use planning and improved compilation of statistics.

The Finnish Commerce Federation will report on the development of the carbon index annually in October, after Statistics Finland has published its statistics on atmospheric emissions and energy accounts. The index can also be followed on the Finnish Commerce Federation’s website at kauppa.fi/hiili-indeksi.

Appendix:Carbon index, charts (in Finnish)

Read more about the Renewable Commerce 2035 roadmap >>  (In Finnish)

For further information, please contact:

Mari Kiviniemi, Managing Director, Finnish Commerce Federation, tel. +358 50 511 3189, mari.kiviniemi@kauppa.fi

Bate Ismail, Economist, Finnish Commerce Federation, tel. +358 40 526 0942, bate.ismail@kauppa.fi

*The carbon index is based on comprehensive information about the direct and indirect emissions in commerce, such as the use of electricity and heat, collected from various official sources. In addition, surveys have been conducted among member companies to determine the present state and future outlook of refrigerants, important in the commerce sector. Other data include the present emissions factors and the future factors for different scenarios produced by Energy Finland. These helped harmonise the impacts that the different scenarios have  on the sector. The harmonised CO2 emissions at present and for different scenarios were indexed using statistical methods to make it possible to monitor changes.