Towards effective climate change mitigation: viewpoints of cost efficiency, uncertainty and consumer choice

In order to limit the concentration of greenhouse gases (GHGs) in the atmosphere and to reach the climate and energy objectives, GHG emission mitigation measures need to be implemented and the share of renewable energy increased in the energy system. In addition to policy actions, consumer energy choices also have an essential effect on the development of GHG emissions and the use of different energy sources. Furthermore, changes in consumer behavior can also be targeted in the policy instruments and the economics of consumers' energy options can be affected through policies. In this dissertation, the analyses were carried out at different levels, sectors and from different viewpoints. Policy measures necessary for meeting the national GHG emission target of Finland with least costs were studied. It was found that there are large differences in the cost-efficiency of different GHG emission mitigation measures. The risks of not meeting the predetermined GHG emission target and exceeding the estimated costs were also evaluated. The results indicate that the costs and achieved GHG emission reductions include large uncertainty, and for example the future oil price development had significant contribution to the uncertainty of GHG emission reduction costs. The progress of electricity from renewable energy sources (RES-E) in Nordic and Baltic countries was also analyzed in this thesis and the development was compared to the RES-E objectives of the countries. The analysis suggests that even if the studied countries are on track to meet their RES-E objectives, some countries are underperforming in the newer RES-E technologies. Also consumer electricity and heating choices were studied in this dissertation. The interaction between policies and consumer behavior was analyzed in particular. It was found that the voluntary green electricity products offered to consumers can include problems weakening the real additional environmental impacts of the green electricity purchase above the legally set requirements. However, especially replacing residential oil heating was one of the most cost-efficient GHG emission mitigation measures in order to meet the Finnish national GHG emission target. This study thus suggests that consumer heating choices are more likely to contribute to the policy objectives than the purchase of differentiated electricity products. It should, however, be noted that the consumer energy choices are influenced by several factors at the same time and they cannot thus be only affected by policies. In addition, the development of market prices like crude oil price can have a large impact on the economics of consumer energy options.; Ilmakehan kasvihuonekaasujen pitoisuuden rajoittaminen seka ilmasto- ja energiatavoitteiden saavuttaminen edellyttavat paastovahennystoimien toteuttamista ja uusiutuvan energian osuuden lisaamista energiajarjestelmassa. Poliittisen saantelyn lisaksi kuluttajan energiavalinnoilla on merkittava vaikutus kasvihuonekaasupaastojen ja eri energialahteiden kayton kehitykseen.…