Browsing by study line "Miljö- och naturresursekonomi"

The Arctic environment is unique and hosts many economic opportunities. The environment is fragile and is home to many different animals, plants and indigenous people. The area has undergone periods of remilitarisation since the end of the cold war, and this is impacting local communities economically, environmentally and their social development. This research has been undertaken to assess the impact that military activity is having on these local communities. A literature review was undertaken in 3 key areas: Arctic sustainability, military sustainability and Arctic militarisation to identify relevant indicators that impact sustainable development. Sustainable development was defined using the 3 pillars from the Brundtland report, as economic, environmental and social. These indicators were collated to create a conceptual framework that was used to analyse two case study cities in the Arctic. These two cities were Fairbanks, in Alaska, and Severomorsk in Russia. These were chosen as economically and socially, they are very different, but they share the main similarity of being militarised Arctic cities. This meant the framework was tested on two different cities and in two different environments to test the validity and usefulness. The two case studies were built from reports, census information, statistical information and government reports. Although quantification was outside the scope of this research, observations were found from the data. Economically, the impact is positive. Military activity generates jobs, growth, infrastructure and military spending. The environmental impact is clearly negative. Military activity contaminates groundwater, soil, water and the local environment. The social impact is more ambiguous. Military activity helps foster community development but can impact personnel health. A discussion was undertaken on the effectiveness of the framework and improvement areas. The framework provided a good overall picture of activity but could be improved in some areas. These areas include reducing subjectivity in the construction phase, improved environmental data and time series data. The research was limited by time constraints and data availability in some impact areas.

This thesis studies the economic benefits that the installation of nature-based solutions can have as a flood risk management tool. The effects of a changing climate often accumulate in urbanised areas and can translate into an increased likelihood and heightened damage potential of precipitation-induced flood events. One way to reduce the devastating flood impact is the use of nature-based solutions, which are management tools relying on natural processes and ecosystem services (EC, 2018). Green roofs are one example of nature-based solutions. To date, little research is available in the academic literature on the economic profitability and cost-efficiency of such alternative approaches (Palmer et al., 2015). The thesis aims to contribute to the scare literature on the topic by conducting a flood damage assessment for a case study site. It is devel-oped from a research contribution to the EU OPERANDUM project, which evaluates nature-based solutions as tool to alleviate hydro-meteorological risks as well as their cost-efficiency on a broader scale (OPERANDUM Project, 2018). The thesis conducts a flood dam-age assessment for green roofs hypothetically installed in Dublin, Ireland. It estimates the expected damage costs from flood scenarios with a recurrence period of 10, 100 and 1000 years. To this end it relies methodologically on a flood damage assessment, specifically the Joint Research Centre model developed by Huizinga, de Moel & Szewczyk (2017), as well as on value transfer. The assessment is re-stricted to the calculation of direct, tangible flood damages. To provide more robust results, the assessment also draws on the analytical insights from the cost-benefit analysis literature and incorporates aspects such as discounting and a partial sensitivity analysis. In terms of software, the majority of the research is carried out in QGIS and Excel. Comparing the flood impacts with and without the installation of nature-based solutions, it assesses the size of the avoided damage costs and finds a noticeable positive impact of green roofs. The green roofs cannot only reduce the size of the flooded areas by up to 19% as well as decrease the water depth in the still inundated parts, but also noteworthily curtails the height of the direct, tangible flood damage costs. The thesis cannot extract definite conclusions on the profitability of green roofs in the sense of providing a net present value, because it does not study costs nor other benefits of green roofs for reasons of scope. It does, however, show that the installation of green roofs can lower the flood damage costs in Dublin by up to 36%. As additional conclusion, this thesis calls for research into more nuanced flood damage assessment methods, since the selected model excluded many factors. A methodological refining could increase the precision of monetary damage estimates. Altogether, the thesis observes that green roofs can be a useful tool to reduce the devastating impact of urban floods. However, green roofs should be combined with other flood management tools, since they can be insufficient if applied on their own.

Since the term blue carbon was first coined in 2009, the interest in the carbon stocks and annual carbon sequestration of mangrove forests, salt marshes and seagrass meadows has increased noticeably. However, in the past couple of years, the carbon capabilities of kelp forests have also started to garner more attention, leading to multiple published studies arguing for their inclusion as a blue carbon ecosystem. However, so far, few studies have actually compared the amount of carbon stored and sequestered by kelp forests to the three traditional blue carbon ecosystems. Thus, the aim of this thesis was to estimate and compare the amount of carbon currently stored and annually sequestered by the different blue carbon ecosystems. Furthermore, the effects and costs of blue carbon ecosystem degradation were also estimated. Based on the results of a thorough literature review regarding the global distribution and degradation rates of the ecosystems as well as the amount of carbon sequestered and stored per unit area, the total amount of carbon stored in blue carbon ecosystems is estimated to be between 5 and 25 Pg, with mangrove forests storing roughly half of that. Yet, whilst kelp forests are estimated to have a far larger global distribution than all of the other blue carbon ecosystems combined, they only store around 0.1–1.4 Pg of carbon, since all of the carbon is stored in their biomass, unlike the other blue carbon ecosystems, in which the vast majority of carbon is located in the soils. However, the total amount of carbon sequestered annually by all blue carbon ecosystems is estimated to be between 40 and 331 Tg, out of which 8–231 Tg is sequestered by kelp forests. Yet, due to the degradation of the ecosystems during 2022, a combined 30–294 Tg of the previously stored carbon is estimated to be released into the atmosphere, whilst the amount sequestered during the year is reduced by roughly 0.4–6 Tg. Out of the carbon released, the majority is from the carbon stocks of seagrass meadows, whilst the carbon sequestration of kelp forests is reduced the most. The total combined cost of the degradation equals €9–174 billion, when the costs of the previously stored carbon released is combined with the NPV of the reduced carbon sequestration. Out of this, the total cost for kelp forests is estimated at €1–59 billion. However, whilst the number of studies published on blue carbon has increased, the data available regarding the ecosystems is still limited. As such, there are considerable uncertainties regarding the values presented and the results of the thesis should thus be considered rough estimates. That being said, the results still underline the importance of blue carbon ecosystems as carbon sinks as well as the considerable costs caused by environmental degradation. Furthermore, the thesis provides further support for the notion that kelp forests should indeed be considered a blue carbon ecosystem.

We study the compensation required to increase carbon sequestration in privately owned forests as a part of effective climate policy. We develop a theoretically correct understanding of compensating additional carbon sequestration in a voluntary stand-level carbon offset scheme by creating incentives for extending the rotation from the privately optimal length. We examine the cost of extending the length of the rotation to a socially desired level. The resulting costs and the increase in carbon sequestration determine the level of compensation required to make the private forest owner indifferent between joining the compensation scheme and resuming privately optimal forest management. A correctly defined subsidy scheme is required as forests are expected to play a major role in meeting national climate change mitigation targets, and so far, the existing schemes have failed to attract voluntary participants. The well-established univariate optimal rotation model (Faustmann 1894, Samuelson 1976) with a net carbon subsidy (van Kooten et al. 1995) is used to evaluate the compensation structure in the California Forest Offset Protocol and the New Zealand Emissions Trading Scheme, and to present a theoretically sound framework for subsidizing additional carbon sequestration in forests. An empirically more realistic size-structured forestry model with carbon storage (Assmuth et al. 2018) is used to verify the understanding of a correctly defined subsidy scheme when thinnings and multiple carbon pools are included. The results of the theoretical modelling are compared to practical applications in California Cap-and-Trade and the New Zealand Emissions Trading Scheme. These practical applications have faced various problems and have been subject to numerous revisions, due to issues with baseline establishment, over-crediting, questionable additionality, and leakage. We show that if the compensation scheme follows the Californian structure, a significantly high compensation is required to create sufficient incentives for private forest owners to participate in the sequestration program. The exclusion of carbon stored in harvested wood products may have decreased voluntary participation of post-1989 forests in the New Zealand Emissions Trading Scheme. These schemes serve as an example for the rest of the world of constructing a carbon sequestration compensation scheme. Thus, it is paramount to evaluate the choices in policy design, by comparing the compensation structure to a theoretically sound way of incentivizing additional carbon sequestration.

Dairy farms account for a large portion of the greenhouse gas emissions in the planet. Since cow manure provides a good medium for anaerobic digestion, this study analyzes the economic feasibility of installing a biogas plant adjacent to a 200-cow farm in Finland. The farms in this study produce only cow manure and grass silage to feed the digester. This paper focuses in comparing different scenarios such as electricity production for farm needs and the production of biofuels such as compressed biomethane as an additional business activity. After designing the farm economic model and the biogas installation, we provide an economic analysis of each scenario. The first one shows that it is not feasible to run the biogas business model based only on electricity savings for the farm. The second one proves that additional revenue streams such as biofuel production can revitalize and strengthen the financial model of the plant. Then, the sensitivity and reliability of the model is discussed by providing reasons (i.e. Finnish electricity tariff system) for the outcome of the results. The model reinforces the idea that farms must base their biogas business model on alternative side-streams and do not rely on energy production only. For further research, it is recommended that real life farm business models are incorporated as input data and a proven plant and CHP engine energy balance is secured.

Despite much scholarly attention given to values and preferences toward the environment, comparatively few studies have examined the spatial relationships between relational values and more established concepts including instrumental and intrinsic values, self-reported knowledge of natural resource management issues, and perceived landscape threats. This study examines these context-based relationships using public participation geographic information systems (PPGIS) survey techniques. An online PPGIS survey was administered during the summer of 2019 to 1,200 residents in Mjölby kommun in Sweden, a community heavily reliant upon silvo-pastoral landscape use. A total of 301 responses were obtained, resulting in a 25.1% response rate. Spatial association and statistical analyses tests were conducted to examine the relationships between different categories of values, self-reported knowledge of natural resource management issues, and values and preferences for landscape threat management. Results indicate that socio-demographics alone have little to no significant impact on how many value points of any category are associated with the environment; however, significant differences in the spatial distribution of values were found by gender and self-reported knowledge of forestry, agriculture, and native biodiversity. Male respondents tended to assign instrumental values in more diverse areas across the landscape. Respondents who rated themselves as knowledgeable about biodiversity tended to assign relational values inside Natura 2000 sites, while those who rated themselves as knowledgeable about forestry avoided placing instrumental values in Natura 2000 sites. Contrary to expectations, instrumental values were the most evenly dispersed across the landscape, while intrinsic values were more concentrated in specific areas, and relational values were the most concentrated around the towns of Mjölby, Skänninge, and Mantorp. High degrees of spatial overlap were found between intrinsic and relational values, implying these value types may be conceptually similar for residents. Future PPGIS research could focus on smaller regions such as those at the municipal or regional level to more precisely identify the context-specific relationships between instrumental, relational and intrinsic values and natural resource management preferences in the local landscape.

We analyse the forest reference level (FRL) projection in Finland. FRLs are included in the European Unions’ new land use, land-use change and forestry (LULUCF) regulation (EU 2018/841) that is part of the actions towards the Paris Agreement’s climate mitigation targets. The regulation defines the accounting rules for carbon dioxide (CO2) emissions within the sector. We build on the LULUCF regulation, the provided guidance documents on the FRL projection, national forestry accounting plans and the existing studies concerning the FRL projections. Business-as-usual reference levels were used for the Kyoto Protocol’s second commitment period. The parties of the Kyoto Protocol had an incentive to report high harvest levels (Frieden et al. 2012). Thus, the reference levels overestimated the harvests by including in assumptions about future policies. Some of the assumptions did not materialize and this led to windfall carbon credits (Grassi et al. 2018, Krug 2018). Such overestimation has happened, for example, in Finland. In this thesis we analyse, whether the new forest reference levels are able to avoid problems that occurred during the Kyoto Protocol. The LULUCF regulation is set for the compliance period (CP) of 2021-2030. The forest reference level is a baseline projection for the forest carbon sink, defined by the historical forest management practices of the reference period (2000-2009). Age-related dynamics of the forest can be taken into account but any anticipated policy changes need to be excluded from the projection. The FRL indirectly defines the level of harvests that are not considered as emissions. The excess carbon sink can be traded to other Member States or be used to compensate the effort sharing sector’s emissions. One of the suggested principles to project historical forest management is to utilize the intensity of management (Grassi and Pilli 2017, Grassi et al. 2018), which is calculated by dividing the reference period’s harvest by the amount of biomass that was available for the wood supply during the same period. The future harvest level is computed by keeping the intensity of management constant. This principle is used in Finland and in several other EU member states. To analyse the suggested principle, we utilize a partial equilibrium model for forestry and agriculture (Mitra and Wan 1985, 1986, Salo and Tahvonen 2004). Using this model, we are able to compute a FRL in a case where policy shock has increased harvest levels after the reference period. This resembles the situation in Finland. Our numerical results show that the choices on the biomass available for wood supply, interest rate and the starting year of the projection can have significant impacts on the FRL computation. By these choices, a member state is able to overestimate the harvest possibilities. Thus, the EU fails to set a regulation that fully excludes national incentives in specifying the FRL. The setting of the Finnish FRL includes a tendency of minimizing the restrictions on the future harvest levels. This outcome follows by choosing high interest rate, early starting year for the projection and a loose definition for the biomass available for wood supply.

Yhteiskunta asettaa yhä enenevissä määrin paineita yrityksille, organisaatioille ja kuluttajille vähentää hiilidioksidipäästöjä ilman pakkokeinoja. Hiilidioksidipäästöjen vähentäminen nollaan ei ole kuitenkaan aina mahdollista ja kustannukset jo pienistäkin vähennyksistä saattavat olla huomattavat. Vaihtoehtona hiilidioksidipäästöjen vähentämiselle on hiilidioksidipäästöjen kompensoiminen. Päästökompensaation myötä yritykset, organisaatiot ja kuluttajat voivat ostaa kompensaatioyksikköjä, mikä tarkoittaa käytännössä sitä, että päästöjään kompensoiva taho maksaa päästöjen vähentämisestä jossain muualla, missä vähentäminen on edullisempaa ja helpompaa. Tämä pro gradu -tutkielma on toteutettu yhteistyössä Nokian Panimon kanssa. Tutkimuksessa lasketaan Nokian Panimon Be sharp -energiajuoman tuotannon hiilidioksidipäästöt, ja tarkoituksena on selvittää kyseisten hiilidioksidipäästöjen kompensaation hinta CO2eston päästöleikkurin avulla sekä tutkia kompensaatiota myös vaihtoehtoisten palveluntarjoajien kautta. Tavoitteena on löytää luotettavuuden ja tehokkuuden kannalta optimaalisin kompensaatiokeino. Tutkimus koostuu kahdesta osasta, kirjallisuuskatsauksesta ja case-tutkimuksesta. Kirjallisuuskatsauksessa keskitytään vapaaehtoisen päästökompensaation teoriaan, sen eri menetelmiin sekä niiden ominaisuuksiin. Osiossa käsitellään erityisesti päästökompensaatiomenetelmien luotettavuutta erilaisin mittarein. Tutkimusosiossa puolestaan käydään läpi Be sharp -energiajuoman hiilijalanjälkilaskennan lähtökohdat, laskenta ja tulokset. Lisäksi paneudutaan itse päästöjen kompensointiin ja siitä koituviin kustannuksiin. Tutkimuksen tuloksissa vastataan kysymyksiin mitkä ovat kompensoivan yrityksen kustannukset vapaaehtoisesta päästökompensaatiosta, mitä kompensaatio kustantaisi muiden palveluntarjoajien kautta ja millä perustein vapaaehtoista päästökompensaatiota tarjoava yritys kannattaisi valita. Tutkimuksen mukaan Be sharp -energiajuoman hiilidioksidipäästöjen kustannukset Euroopan päästöoikeuskaupan päästöoikeuden hinnasta riippuen, vuonna 2021 ovat 25,4–46,2 €/ 1000 l. Kustannukset eivät ole siis kovin merkittävät suhteessa tuotteen vähittäismyyntihintaan noin 3600 €/ 1000 l. Kompensaation kustannukset vaihtoehtoisten palveluntarjoajien kautta vaihtelevat välillä 4.7 €-35,7 €/ 1000 Hintaerot voivat olla merkittäviäkin, ja osassa kompensaatiokeinoista hinnan määritys on epäselvä. Tutkimuksessa todetaan, että hinnan sijaan tärkeämpää kompensaatioita tarjoavan yrityksen valinnassa ovat kriteerit, joita kompensaatiomarkkinalla pidetään yleisesti luotettavina mittareina. Tärkeimmät kriteerit ovat päästövähennysten lisäisyys, kaksoislaskennan välttäminen, mitattavuus, pysyvyys, ajoitus, hiilivuodon välttäminen, dokumentaatio ja valvonta. Näiden kriteerien avulla päästöjään kompensoiva taho voi löytää parhaan mahdollisen kompensaatiokeinon markkinoilta. Tämä vaatii kuitenkin pitkällistä perehtymistä aiheeseen, ja palvelujen luotettavuus saattaa silti jäädä epäselväksi. Markkinaa tulisikin selkeyttää ja mahdollisesti jopa rajoittaa väärinkäsitysten ja disinformaation välttämiseksi.

Forests play a central role in climate change mitigation actions, and substitution, that is the use of wood products in place of fossil intensive materials, has been recognized as a potential way to avoid emissions. While there are studies estimating the substitution impact of products, i.e., the avoided emissions, there is a lack of studies integrating market perspectives into substitution estimation. To contribute to this research gap, this study explores the market assumptions of substitution through the theoretical lenses of value chains and microeconomic theory on demand. The objectives are to recognize powerful decision-makers in the value chains, to establish a better understanding for the current state of substitution in the markets, and to explore the determinants of demand of the wood-based products. To limit the scope of this study, the use of pulp-based products was examined in the cases of packaging and textile sectors. Semi-structured interviews with 14 experts were arranged to discuss their views on substitution and demand of the pulp-based products in the chosen sectors. Additionally, a Likert scale was filled at the end of each interview to supplement the interview answers and enable elasticity and cross-price elasticity analyses to examine substitution. The sample of respondents was chosen through the use of snowball sampling and a matrix to recognize potential interviewees. First, the findings of this study suggest that in both sectors, the decision-making power on materials is held by the operators at the end of the value chain whereas the forest sector is located at the beginning of the chain. Second, in both sectors, there is willingness to find more sustainable material solutions, but the tools for this are lacking. In the case of packaging sector, the barrier capacities of plastic are unattainable with fiber-based materials, meaning that reducing plastic use does not always imply switching the feedstock itself. In the textile sector, the production of wood-based textile fibers is not yet scaled enough for it to compete with similar materials. However, the analysis of elasticities indicates that some substitution can be expected in both sectors. Third, a number of important determinants of demand were identified, yet no single factor could be identified as the most important one. This study concluded that there is room to improve the market assumptions for substitution impact estimation. In packages, the market preferences of fiber-based packaging in some uses give a rise for interpretational issues, while plastic reduction goals do not always imply switching to wood feedstock. In textiles, the new man-made cellulosic fibers (MMCFs) are expected to mostly substitute for viscose and fill the cellulosic gap from stagnating production of cotton instead of substituting for synthetic fibers. To conclude, it is central to integrate market data and concepts better into future substitution impact analyses to facilitate more realistic estimates.

Uusiutuvan energia rooli on noussut yhä tärkeämmäksi osaksi ilmastonmuutoksen hillinnässä. Energian tarve tulee ennusteiden mukaan enemmän kuin tuplaantumaan seuraavan kahdenkymmenen vuoden aikana. Samaan aikaan energiasektori tuottaa yli puolet koko maailman ilmastopäästöistä. Suosituksi uusiutuvaksi energiamuodoksi etenkin Euroopassa on nousemassa tuulivoima. Tutkimuksessa keskitytään erityisesti merituulivoimalla tuotettuun energiaan ja siihen, miten energia saadaan siirrettyä kustannustehokkaimmalla tavalla mantereelle energiasiirtoverkon piiriin. Tarkasteltaviksi siirtotavoiksi valikoituivat sähkönsiirtokaapeli sekä vety. Sähkönsiirtokaapeli otettiin mukaan, koska se on hyvin perinteinen tapa siirtää energiaa. Vety otettiin mukaan, koska se on vieraampi ja vähemmän tutkittu siirtotapa. Tuulivoimalla tuotettu vety on lisäksi päästötöntä vihreää vetyä, kun taas yhä 2000-luvulla suosituin tapa tuottaa vetyä maakaasun avulla on päästöjä tuottava harmaa tapa. Vety mahdollistaa myös energian varastoinnin sähköenergiaa paremmin. Tutkimuksessa käytetään kolmea eri menetelmää, jotka ovat vahvuuksia, heikkouksia, mahdollisuuksia ja uhkia vertaileva SWOT-analyysi, sähkönsiirtokaapelia ja vedyn eri siirtotapoja vertaileva kustannusvaikuttavuusanalyysi sekä tutkimushaastattelu. SWOT-analyysin ja kustannusvaikuttavuusanalyysin tiedot on kerätty vertaisarvioidusta kirjallisuudesta. Vetyala on kuitenkin verrattain uusi ja vielä tutkimuksen kohteena etenkin energiasektorilla, joten kaikkea tietoa ei ollut vielä tutkittu tai tuotu julkisuuteen. Jotta kirjallisuudesta saatua käsitystä voitaisiin vahvistaa uusimmilla mahdollisilla tiedoilla tai vaihtoehtoisesti todeta kirjallisuudessa esiintyviä tietoja vanhoiksi tai epärealistisiksi, toteutettiin tutkimuksessa tutkimushaastattelu, jonka kysymykset esitettiin tuulivoima- sekä vetyalan asiantuntijoille. Tutkimuksen tuloksissa selvisi, että sähkönsiirtokaapeli on edullisin tapa siirtää energiaa merituulivoimalalta, jos välimatka oli alle 100 kilometriä. Tietoa sähkönsiirtokaapelin kustannuksista pitkällä, yli 100 kilometrin, välimatkalla ei kirjallisuudesta löytynyt. Yli 100 kilometrin välimatkalla vedyn siirto oli kannattavinta toteuttaa tankkerilla, alle 100 kilometrin matkalla kaasuputkella. Vedyn ja sen siirtämisen keskeisimmät hyvät puolet ovat runsaat saatavilla olevat resurssit, hyvä varastointimahdollisuus sekä suuret mahdollisuudet fossiilisten energiamuotojen korvaajana. Huonoina puolina ovat etenkin vihreän vedyn tuottamiseen tarvittavan elektrolyyserin korkea hinta, vedyn energiakäytön standardien puutteellisuus sekä vahva kytkeytyminen sähkön markkinahintaan, joka on vaihdellut vuoden 2022 aikana paljon. Jotta ilmastopäästöjä saadaan vähennettyä, muutokset energiasektorilla nähdään välttämättöminä. 2020-luvulla tuulivoimasta ja vedystä on tullut yksi potentiaalisimmista vaihtoehdoista. Vety parantaa energian tuotantovarmuutta etenkin niissä maissa, joissa riippuvuus fossiilisten energialähteiden tuonnista on suurta ja samalla potentiaali kasvihuonekaasupäästöjen vähentämisessä on korkea. Vedyn tuotanto saattaa ainakin aluksi painottua lähelle teollisuuslaitoksia, joissa vedyn kysyntä on suurta. Liikennesektorilla kysyntä todennäköisesti painottuu ainakin aluksi lauttaliikenteeseen sekä tieliikenteessä raskaaseen kalustoon. Vihreä vedyn tuottaminen on vielä kallista, mutta aikana, jolloin fossiilivapaus on yksi tavoiteltavista arvoista, voi vihreä vety nousta harmaata vetyä suositummaksi hinnasta riippumatta.