Sequester or substitute—Consequences of increased production of wood based energy on the carbon balance in Finland

Forests play an important role in mitigating climate change. Forests can sequester carbon from the atmosphere and provide biomass, which can be used to substitute for fossil fuels or energy-intensive materials. International climate policies favor the use of wood to substitute for fossil fuels rather than using forests as carbon sink. We examine the trade off between sequestering carbon in forests and substituting wood for fossil fuels in Finland. For Finland to meet its EU targets for the use of renewable energy by 2020, a considerable increase in the use of wood for energy is necessary. We compare scenarios in which the wood energy targets are fully or partially met to a reference case where policies favoring wood based energy production are removed. Three models are used to project fossil fuel substitution and changes in forest carbon sinks in the scenarios through 2035.