Together with the Finnish Meteorological Institute (FMI) UPM is actively doing research on how climate change will affect forestry and wood sourcing and thus UPM’s business operations in the long run.
“We will utilise these results in developing our business operations. At the same time all of this is valuable information we can share with our investors and our other important stakeholders,” explains Tuomas Niemi, Manager for Reporting and Standards at UPM.
The TCFD recommendations (Task Force on Climate-Related Financial Disclosures) are a voluntary tool for companies. With the TCFD recommendations companies can disclose what risks and opportunities climate change means for them in the long run. In the future, alongside the TCFD recommendations, EU legislation will possibly obligate companies to disclose how climate change impacts their business operations.
“The Finnish Meteorological Institute’s report will be completed in May. It will help us prepare for future reporting requirements. Risk evaluation in particular is important for companies whose raw material procurement, supply chain, logistic operations and steady mill operation are subject to climate risks”, Niemi states.
“In addition, new business opportunities will pop up for companies that provide solutions for decreasing carbon dioxide emissions or adapting to the climate change,” he continues.
The Finnish Meteorological Institute as a valuable partner
Antti Mäkelä, Head of Climate Change and Extreme Weather Group at the Finnish Meteorological Institute, describes that according to the most plausible climate scenario, the global reduction of carbon dioxide emissions will be partially achieved.
“The climate warming will continue despite the restrictions as carbon can persist in the atmosphere for a very long time. The current emissions will have an impact for some 20 years from today. The situation should however become more balanced at the end of this century,” Mäkelä estimates.
In the arctic regions the annual rise in the average temperature is expected to be almost double compared to other regions of the world. The decrease of snow- and ice-covered areas will accelerate the development as sea and soil will absorb even more heat.
“Winters in Finland will be warmer and shorter and there will be more rain. Warm winters will make harvesting wood more difficult as the soil will not freeze. The extreme weather conditions will however be milder in Finland compared to many other countries.”
Accelerating forest growth
Increasing rainfall will increase the potential of hydropower. “We will have to foresee the extreme situations precisely in order to not exceed the current flood limits in the power plant areas,” Mäkelä explains.
Mäkelä adds that for example in South America there will be more rainfall even with rising temperatures caused by global warming. The drought will therefore not be as big a problem in these tropical and subtropical areas.
Long and cold winters have made Finland unendurable for many insects. The warmer climate will mean more biotic risks for wood sourcing. “We have to follow the conditions of our forests more precisely. For example, we might have to harvest earlier depending on the insect population.”
Climate change also accelerates forest growth. “The more carbon there is in the atmosphere, the more efficient is photosynthesis. A living, growing forest absorbs carbon. The old, decomposing forest emits carbon dioxide,” says Mäkelä.
Evaluating the impact of different climate scenarios supports us in assessing the risks and opportunities related to climate change. While our operations are vulnerable to physical climate risks, the solutions that reduce emissions and help adapting to this change create new business opportunities in transition to low-carbon economy.
Text: Vesa Puoskari
