Browsing by master's degree program "Master's Programme in Agricultural, Environmental and Rescource Economics"

The microproduction of solar photovoltaics (PV) has grown enormously in recent years in Finland, and it is expected to grow even further due to the ambitious renewable energy targets and the on-going smart energy transition. Nevertheless, there is a lack of country-level statistical analysis on the topic. This thesis studies which sociodemographic, economic, and geographical factors explain the microproduction of solar electricity in Finland. The thesis consists of a literature review and statistical analysis on the electricity distribution system operator (DSO) level. The response variables are the number of prosumer contracts and the capacity of solar PV microproduction. The data, which were gathered from various open sources, is analyzed in a descriptive manner followed by multiple linear regression analysis. The analysis uses the ordinary least square method. In addition, profitability calculations are made to study economic incentives and barriers to the adoption of a PV system. The results suggest that the microproduction of solar PV is connected to non-urban areas and higher mean age. Instead, there are not that many separate prosumers in urban areas, but single systems’ capacities are more extensive there. The analysis showed that electricity price has a significant impact on the microproduction of solar PV. The profitability calculations support this result: electricity price substantially affects the viability of solar PV system investment. Thus, the introduction of financial incentives could enhance the adoption of solar PV systems among households. This thesis offers a comprehensive overview of small-scale solar electricity production in Finland. However, the characteristics of the microproduction of solar PV are complex and involve various interactions that are difficult to capture in aggregated data. This offers an opportunity to repeat the analysis with a more detailed geospatial dataset in the future.

Lihantuotanto on ollut Euroopan unionin merkittävimpiä tuotantohaaroja ja unionin alueella tuotetaan kolmanneksi eniten naudanlihaa koko maailmassa. Naudanlihaa tuotetaan koko unionin alueella. Aiemmissa tutkimuksissa on todettu, että jäsenvaltioiden erikoistuminen, unioniin liittymisen ajankohta, tuotantoteknologia ja maantieteellinen sijainti vaikuttavat naudanlihan tuottajahintaan. Markkinat ovat heterogeeniset. Tutkimuksen tavoitteena on tarkastella naudanlihan tuottajahintaan vaikuttavia tekijöitä Euroopan unionin jäsenvaltioissa ja Euroopan unionin sisämarkkinoiden homogeenisyyttä. Tutkimuksessa selvitetään, mitkä tekijät vaikuttavat naudanlihan markkinoiden tuottajahintaan ja hinnan vaihteluihin Tähän tutkimukseen valittiin kolme unionin jäsenvaltiota Suomi, Ranska ja Puola. Aineisto koostuu aikasarjoista. Suomen aikasarjat ovat tammikuusta 2010 joulukuuhun 2019. Ranskan ja Puolan aikasarjat ovat toukokuusta 2006 joulukuuhun 2019. Tutkimuksessa käytetään Engle-Granger menetelmää. Menetelmässä tutkitaan aikasarjojen stationaarisuutta ja yhteisintegroituneisuutta ja lopuksi muodostetaan virheenkorjausmalli. Virheenkorjausmalli kuvaa kuinka nopeasti lyhyen aikavälin suhde palaa pitkän aikavälin tasapainoon. Naudanlihan tuottajahintaan vaikuttaviksi tekijöiksi valittiin viisi selittävää tekijää. Selittävät tekijät ovat naudanlihan tuotannon määrä, Euroopan unionin naudanlihan, raakamaidon ja porsaanlihan markkinahinta sekä tuotantopanos. Rehumaissin markkinahinta kuvaa Ranskan ja Puolan naudanlihan tuotantopanosta ja rapsin tuottajahinta Suomen naudanlihan tuotantopanosta. Selittävien tekijöiden havaittiin olevan epästationaarisia ja yhteisintegroituneita. Virheenkorjausmallin tarkastelu osoitti, että jäsenvaltioiden eroavaisuudet vaikuttavat naudanlihan tuottajahintaan enemmän kuin jokin yhdistävä voima. Puolalle virheenkorjausmallissa tilastollisesti merkitsevät ja etumerkiltään teorian mukaiset selittävät tekijät ovat Euroopan unionin naudanlihan markkinahinta, naudanlihan tuotanto sekä raakamaidon markkinahinta. Ranskalle virheenkorjausmallissa tilastollisesti merkitsevät ja etumerkiltään teorian mukaiset selittävät tekijät ovat Euroopan unionin naudanlihan ja raakamaidon markkinahinta. Suomelle virheenkorjausmallissa ei voitu osoittaa tilastollisesti merkitseviä ja etumerkiltään teorian mukaisia selittäviä tekijöitä. Estimoinnin tulokset olivat yleisesti yhdenmukaiset kirjallisuuden kanssa. Tutkimuksessa saatiin viitteitä Euroopan unionin naudanlihan tuottajahinnan muodostumisesta ja unionin markkinoiden heterogeenisyydestä. Naudanlihan tuottajahintaan vaikuttaa jäsenvaltioiden erikoistuminen, unioniin liittymisen ajankohta, tuotantoteknologia ja maantieteellinen sijainti. Tutkimus osoittaa, että Euroopan unionin naudanlihamarkkinat eivät ole integroituneet täydellisesti ja jäsenvaltioiden erot vaikuttavat naudanlihan tuottajahintaan enemmän kuin jokin yhdistävä voima. Tutkimuksen tulokset eivät kuitenkaan ole yleistettävissä koskemaan koko unionin aluetta. Tutkimus kuitenkin osoittaa, että tutkimukseen valitut selittävät tekijät sisältävät hyödyllistä informaatiota Euroopan unionin jäsenvaltioiden naudanlihan tuottajahintaan vaikuttavista tekijöistä.

The Master's thesis examines the profitability of small hydropower production and the factors affecting it in Finland. During the last century, almost all of Finland's watercourses have been dammed for the needs of industry and energy production. Hydropower is detrimental to the aquatic ecosystem and to migratory fish, which are unable to ascend to their breeding grounds. The impact of hydropower production on fish stocks can be reduced, for example, by fishways, but for the smallest power plants, building a fishway is a big investment. The purpose of the study is to build a calculation model that can be used to assess the profitability of a small hydropower plant renovation investment or the construction of a fishway. Society’s pressure to make solutions that reconcile hydropower and water ecology is growing all the time. It is therefore important to be able to analyze cases where the construction of fishway or the repair of a hydropower plant is not socially viable, but efforts should be made to dismantle the dam and restore the stream water ecosystem. The method of assessing profitability is the private cost-benefit analysis and the net present value method. The calculation model can be used to estimate when it is not worth investing in small hydropower plants, but the model does not directly tell when the investment would be profitable, as it only takes into account the largest sections of costs and does not take into account environmental damage. The dissertation also makes example calculations for three small hydropower plants: Kantturakoski, Ritakoski and Kangaskoski. The aim is to find out the main factors influencing the profitability of small hydropower production and to clarify the understanding of what the future of small hydropower production looks like. According to the results of the study, the construction of the Kantturakoski fishway is not profitable from the owner's point of view. The net present values for the repair of the Ritakoski and Kangaskoski power plants in Hiitolanjoki and the construction of the fishway are positive. The sensitivity analysis showed that the net present values of the projects depend in particular on the price of electricity and the operating and maintenance costs of the power plant.

As the global population grows and the demand for agricultural commodities increases, empirical measurement of agricultural productivity becomes all the more important. Agricultural productivity is the relationship between yield and inputs and can in simple terms be decomposed into technical change, technical efficiency and scale-effect. Agricultural productivity and its development with time are often studied using price and quantity indices as well as non-parametric and parametric modelling. In this thesis, a mean-value based pseudo-panel created from FADN farm data was used to analyse the productivity development of Finnish cereal farms between 2000-2018. Several functional forms, assumptions of returns to scale and combinations of variables were used to create and test several parametric models. Technical change was observed both at aggregate level for all size classes and for size classes separately. Pooled, fixed effects (FE) and random effects (RE) models were tested with the pseudo-panel. Pooled models were weighted with the number of observations for each mean-value. Results showed little to no technical change in the various size classes. Returns to scale were increasing in all models. Land was a highly significant factor of productivity growth and was found to be notably more significant than the other inputs, labour, capital and materials. FE model were mostly preferred over pooled models and R2-values of all models were over 95% implying over-complexity of models, particularly in the case of the FE models. Very high VIF values were obtained for variables, implying strong multicollinearity between variables. While results regarding technical change are, at a very high level, in line with previous studies on Finnish cereal productivity, the combination of high VIF, fluctuating elasticities between models and limited degrees of freedom indicate that the pseudo-panel method might not provide valuable results in productivity analysis when FADN mean-based data is used. More data-points per year or farm-level data would be required to increase statistical validity of results.

Aquaculture production has enabled the considerably increased consumption of fish for the past decades. While fish is a good source of nutrition, its production is causing negative externalities for instance in a form of eutrophicating nutrient releases. These are attempted to diminish by regulation which has in turn enhanced the stagnation of the aquaculture sector in the EU. Most of the production is currently performed in marine net cages but to harness the economic potential of the sector without further deteriorating the waters, new, more environmentally sustainable options are sought. Bringing the production to land-based indoor facilities with recirculating water is one plausible option. The nutrient releases from these Recirculating Aquaculture Systems (RAS) are significantly smaller as most of the nitrogen (N) and phosphorus (P) can be purified. However, despite the efficiency perks the indoor rearing with adjustable conditions is yielding, the operation and especially the investment costs are likely to be much higher than in the prevailing cage-based production decreasing the desirability of the technology. I conducted a social cost-benefit analysis (CBA) to compare these two alternative aquaculture production technologies, net cage and RAS, from the society’s perspective. In addition to private costs, i.e., investment and production costs, the analysis takes into consideration the eutrophication damage of the released nutrients. The eutrophication damage is determined in monetary terms to make them commensurate with the other costs. For the same reason, all the costs and benefits are discounted to present values prior the comparison. The analysis has special focus on the Baltic Sea and Finland. Due to its dominance in the Finnish aquaculture production, rainbow trout was chosen as the main specie to study along whitefish as a higher value specie. To further examine the economic performance of RAS technology, pike perch production is also included. In addition, due to the uncertainties regarding the cost factors and developing technology, I present a comprehensive sensitivity analysis regarding the discount rate, investment costs of RAS, producer price, and eutrophication damage valuation. When it comes to large scale production of rainbow trout, the results show higher net present value (NPV) for the net cage production. However, when the eutrophication damage costs are taken into consideration the difference between net cage and RAS production decreases. RAS technology seems to be highly profitable in whitefish production, implying that is economically sensible to focus on higher value species. Under the strict environmental legislation regarding the Weser ruling of the EU Water Framework Directive (WFD) activities preventing or hindering to reach the good environmental status waters cannot be allowed. As this can also cause denial of permits for RAS production and further decreasing the distinctive nutrient load of the net cage aquaculture is a challenge considering the economic and technological restrictions, one solution could be offsetting the nutrient load. Gypsum amendment of fields has been found to be a cost-effective measure in preventing phosphorus releases; thus, the initial analysis is extended to include onetime nutrient offsets from farmers. According to the results, it is sensible offsetting measure as the environmental benefits from offsetting are higher than the costs of doing so under net cage production and at the same level under RAS production. The current environmental regulation is affecting hardest on the point sources such as aquaculture farms. This is felt unfair by the fish farmers. To shed light on the issue, another social CBA examines the social net benefits of beef and cultured meat production and compares the NPVs with rainbow trout farming under net cage and RAS technologies. The analysis is conducted with respect to produced protein to make the alternative food sources commensurate. In addition to private costs and eutrophication damage costs of nutrients, it also includes the atmospheric damage costs of carbon dioxide emissions. The results show clear superiority of aquaculture as a protein producer. The thesis concludes that due to the efficiency of aquaculture in producing protein and its potential in the blue growth sector, it is definitely reasonable to seek sustainable ways to produce fish. While net cage technology is currently the best option for large scale aquaculture, RAS has potential on the niche market of higher value species. The technological development has tendency to decrease the costs related to the necessary equipment and if the technology is to overcome its other uncertainties, it may have an important role in the future. Nevertheless, the environmental regulation ought to be adjusted to enable the blue growth in an environmentally and financially sustainable manner.

Maidontuotannon tulee olla pitkällä aikavälillä kannattavaa ja tuottajan on pyrittävä reagoimaan ennakoivasti toimintaympäristön jatkuvaan muutokseen. Strategisessa johtamisessa tuottajan on tärkeä tunnistaa toimintaympäristöstä tulevat muutostarpeet, muokata strategiaa uutta toimintaympäristöä vastaavaksi ja tunnistaa uusien innovaatioiden hyödyntämismahdollisuudet. Innovaatioiden merkitys korostuu etenkin nopeasti muuttuvassa toimintaympäristössä, jossa toiminnan laajentaminen ja mittakaavaetujen tavoittelu ei enää riitä takamaan kilpailukykyä. Tutkimuksen tavoite oli selvittää, kuinka luomumaidontuottajat ovat omaksuneet luomuinnovaation ja mitkä tekijät ovat vaikuttaneet tuottajien päätökseen siirtyä luomumaidontuotantoon. Päätöksentekoprosessissa keskityttiin tarkastelemaan innovaation eri ominaisuuksien vaikutuksia siirtymispäätökseen. Tutkimuksen tutkimuskysymykset olivat: Mitkä tekijät ovat vaikuttaneet tuottajan päätökseen siirtyä luomumaidontuotantoon ja onko innovaation käyttöönotto tuonut tavoiteltua hyötyä. Tutkimuksen teoriana on innovaatioiden leviämisen teoria ja näkökulmana on maitotilan strateginen johtaminen. Tuloksien perusteella strategian vaihtaminen on tuonut haastateltaville tiloille tavoiteltua hyötyä luomuinnovaation käyttöönoton myötä. Vastauksista nousi esiin, että taloudelliset tekijät ovat olleet merkittävin syy siirtymiselle, mutta eläinten hyvinvointi, kestävä viljely sekä kuluttajamarkkinoiden seuraaminen ovat olleet myös päätökseen vaikuttaneita tekijöitä. Luomuinnovaation omaksumista heikentävinä tekijöinä ilmenivät luomutuotannon byrokratia ja yhteensopivuus yhteiskunnan normien kanssa.

Ilmastonmuutos on globaali ongelma, jonka torjunta vaatii merkittäviä päästövähennyksiä. Energiantuotanto on yksi merkittävä ilmastolle haitallisia päästöjä aiheuttava sektori. Samaan aikaan globaali energiankysyntä kasvaa jatkuvasti väestönkasvun ja teollistumisen seurauksena. Energiantuotannon päästöjä voidaan vähentää energiateknologialla, uusiutuvan energian ja energiatehokkuuden avulla. Tieteelliset teoriat, joista yksi tunnetuimmista on Porterin hypoteesi, näkevät tiukan ympäristöregulaation vaikuttavan positiivisesti teknologiseen kehitykseen. Ympäristösääntelyn ollessa korkealla tasolla sekä Suomessa että EU:ssa, on Suomella Porterin teorian mukaan hyvät edellytykset kehittää energiateknologiaa ulkomaanvientiin asti. Myös Suomen valtio on panostanut viimevuosina energiateknologian kehitykseen ja maan tavoitteena on hyötyä energiateknologian kehityksestä kotimaisten päästövähennysten lisäksi energiateknologiaviennin kasvattamisen avulla. Tutkielmassani selvitän Suomen energiateknologiaviennin kehitystä ja sen piirteitä vuosina 2010–2018. Olen määrittänyt 457 energiateknologian tuotetta, jotka kuvaavat Suomen energiateknologiaviennin kokonaisuutta. Tutkin tarkemmin Suomen vuoden 2018 energiateknologiavientiä sekä tuulivoimateknologiavientiä vuosina 2010–2018. Suomen energiateknologiavienti on pysynyt melko tasaisena tarkastelujakson ajan. Suomen vuotuinen energiateknologiavienti liikkui viiden miljardin euron tuntumassa vuodesta 2010 vuoteen 2018. Sen sijaan Suomen tuulivoimateknologiavienti on aaltoilevaa, mutta siitä oli havaittavissa kehittyvä kasvutrendi vuodesta 2010 vuoteen 2018. Global climate change is a major issue. Limiting the rise in global temperature below a critical point requires big emission reductions. Globally, energy production causes emissions harmful to the climate. Demand for energy is constantly growing because of population growth and industrialization. However, advances in renewable energy technology can help reduce the levels of emissions. Energy technology can also reduce the final consumption levels of energy by improving energy efficiency. In Finland and EU, environmental regulation is on high level and some theories suggest that this advances technological development. A well-known theory supporting this is Porter’s hypothesis. Regarding these theories, Finland has a good opportunity to develop its energy technology. The government of Finland is investing in low-carbon energy technology and it aims is to gain some benefits by exporting these technologies. In this paper, I will study the exportation of energy technology of Finland in 2010–2018 in general, but also focusing on the exportation of wind power technology. I have defined 457 energy technology products that form the export of energy technology of Finland. The energy technology of Finland has been stable in 2010–2018. The value of this trade in euros has remained stable, approximately five billion euros. While the share of energy technology exports from the total value of exports in Finland has slowly reduced in 2010-2018. Wind power technology export of Finland have been fluctuating, but they have increased more clearly than the total energy technology export of Finland.

Given the urgency of the drastic reduction targets for air traffic, it is necessary to assess which different actions will benefit the achievement of the targets in the short-term. Investments in new and lower-emission aircrafts take time, making them long-term solutions. The introduction of alternative jet fuels, in turn, are impaired by inadequate production levels and lack of economic viability. The benefits of climate offsetting will only be seen in the long term, despite short-term actions. This study presents different tax instruments as the only solution to reduce aviation emissions in the short-term, in the absence of abatement technology. In this Master's thesis I examined, how taxation as a policy instrument can curb aviation emissions in the short-term. The policy instruments considered were fuel, ticket and seat tax and VAT, as well as emissions trading. The impact of the taxes were tested on three different one-way routes. The selected routes included a domestic flight and one intra- and inter-EEA flights. The analysis of short-term emission reduction measures assumed a monopolistic market structure, where the focal airlines have market power. The results were derived by optimizing the flight ticket price from the airline’s profit function, which was used to estimate the number of passengers on the given routes, and thereby the weight of the aircraft as well as the final fuel consumption and the emissions. The results showed, that emission reductions for all the given policy instruments remained very low in the short-term. This finding was not only due to insufficient tax levels, but also to the relatively low share of the passengers in the total emissions. Of the selected instruments, the smallest emission reduction was achieved by emissions trading, and the largest reductions by ticket and value-added tax. The seat tax was not found to have any impact on the emissions. Looking at airline profits, it was found that despite the highest emission reduction figures, the impact of the ticket tax on profits was relatively low compared to other instruments. The largest losses and highest tax revenues were generated from VAT on flight tickets. In addition to emissions trading, the fuel tax was the only policy instrument directly linked to emissions. The increase in fuel prices caused by the fuel tax could make alternative jet fuels, such as synthetic fuels, competitive in the markets. Achieving significant emission reductions in the short-term would require cutting entire flights. However, a significant reduction in passenger numbers could be avoided by seeking to increase the passenger load factors. In reality, airlines have multiple ways to adjust to the given policy instruments. The future research could be extended to consider also other forms of policy adaptation and long-term adaptation strategies.

I Finland fungerade ett statligt skördeförsäkringsprogram mellan åren 1976-2015. Programmet täckte majoriteten av odlingsgrödorna och samtliga lantbrukare deltog kostnadsfritt i programmet. Det var dock mycket ineffektivt och hela 60% av de finländska gårdarna hade aldrig erhållit ersättning ur programmet. Orsaken var att hela gårdens skördeförluster på samtliga grödor måste vara under en låg nivå för att redogöra för en ersättning. Detta var sällan verkligheten på gårdarna. Reformen i EU:s gemensamma jordbrukspolitik (CAP) år 2015 innebar bredare EU stöd för privata-statliga samarbeten på skördeförsäkringsmarknaden. Som en följd av detta avslutades det statliga programmet i Finland i syfte att ge rum för privata försäkringsbolag på marknaden. Denna övergång skedde dock aldrig och idag är det enbart ett stort försäkringsbolag som erbjuder skördeförsäkringar överhuvudtaget. Den totalt stagnerade marknaden för skördeförsäkringar Finland bör återupplivas, därav denna avhandling. Syftet med denna avhandling var att undersöka hur en indexskördeförsäkring baserat på väderfenomenen nederbördsmängd samt medeltemperatur, skulle fungera i Finland. De statistiska sambanden mellan ovannämnda variabler och skördenivåerna vårvete och korn granskades i syfte att undersöka ifall en tillräckligt stark korrelation förekommer mellan dem. En nederbördsförsäkring simulerades även med en lämplig kalkylmodell. Materialet för regressionsanalysen samt korrelationstesten bestod av lokala skördenivåer och nederbördsmängder insamlade av Sydvästra skördekontrollföreningen, som är en medlemsförening i Nylands Svenska Lantbrukssällskap. Data gällande medeltemperaturen samt övrig nederbördsmängd härstammar från Meteorologiska institutets arkiv. Det förekom en medelmåttigt stark korrelation (r 0.52) mellan vårvete och nederbördsmängd Mellan kornskörden och nederbördsmängden var korrelationen inte signifikant och med ett r 0.29 Medeltemperaturen var signifikant, medelmåttigt negativt korrelerad med både vårvete- och kornskördarna. Med vårvete var korrelationsvärdet r -0,496 och med korn -0,432. Den negativ korrelationen lär bero på det faktum att heta växtperioder även fört med sig perioder av torka vilket påverkat skördenivåerna negativt. Resultaten från regressionsanalysen gav en förklaringsgrad på 0.468 vilket innebär att 46.8% av variationen i vårveteskörden kan förklaras med nederbördsmängden och medeltemperaturen. Nederbördsmängden hade den största inverkan på skördenivån eftersom dess p värde var signifikant t.om. på en 1% signifikansnivå. Med en kalkylmodell simulerades en nederbördsindexförsäkring. Nederbördsdata från alla 15 NTM centraler i Finland undersöktes. Resultaten visar att det vore lönsamt för försäkringsbolagen eftersom utbetalningar inte sker varje år. Förekomsten av systemisk risk är dock närvarande och måste tas i beaktande i prissättningen. För försäkringstagaren vore det även lönsamt eftersom försäkringen ger utbetalningar i de fallen då torka påverkat skördenivåerna mycket negativt. Sammanfattningsvis kunde konstateras att eftersom en påvisad efterfråga för indexförsäkringar samt en korrelation mellan variablerna finns, skulle en sådan fungera. Det krävs mer forskning i vilka variabler som minimerar risken och korrelerar maximalt med skördenivåerna. Data på lokalnivå behövs granskas eftersom hela ladets medeltal nödvändigtvis inte korrelerar med enskilda gårdars.

Meat is an important source of protein, but the negative environmental impact of meat production is significant. Discussion around meat consumption is often heated, and plant-based protein products are primarily seen as an option to lower the environmental impact of a diet. The production processes for different kinds of meats vary notable. The differences in environmental impacts of diverse production animal species can be explained by three factors: feed conversion ratio, the differences in monogastric and ruminant digestive systems and differences in reproduction traits. Choosing broiler instead of red meat can mitigate the environmental impact of a diet. Environmental impacts of the different meat production processes have been analysed using Life Cycle Assessment. Life Cycle Assessment investigates the use of resources and the green house gas emissions of a livestock production process to evaluate its climate-friendliness. Corporate Social Responsibility is also used as a pivotal theory in this research. The results of Life Cycle Assessment can be used to include sustainability in a company’s strategy, or in communication about Corporate Social Responsibility. The goal of the thesis was to investigate how aware and interested Nordic 24-30-year-old young adults are about the environmental impacts of meat production. Nordic young adults were chosen as the target group, because the Nordic countries are generally seen as the forerunners of sustainability. Young adults were selected because they represent the future way of consuming. The goal of the thesis was to answer following questions: 1. Do the Nordic young consumers feel the need to reduce meat consumption for climate reasons? 2. Do the Nordic young consumers find broiler an appealing source of protein? Four young consumers were interviewed from three different countries: Finland, Sweden, and Denmark. Although the participants of the study showed awareness and knowledge of the negative environmental impacts of meat production, only three of them had made changes to their diet for environmental reasons. Nine of the 12 interviewees supposed that broiler is more environmentally friendly than red meat. Animal welfare issues in broiler production processes lowered the interest towards broiler as a protein source. All four Danish interviewees avoided conventional broiler because of the welfare issues. The upsides of broiler as a source of protein are low fat content, affordable price, and good taste. The living conditions and slaughter process of broilers have great deficiencies, which decreased its appeal amongst the young consumers.