Climate change is the major challenge for the energy sector. Today approximately two-thirds of global emission are from the production and the use of energy. This clearly puts a lot of responsibility for combating climate change on the energy sector.
There is an urgent need for a long-sighted, comprehensive climate agreement that is signed and implemented by all key countries. We hope Paris COP21 will deliver a stable and long-term policy framework that provides a clear signal for mobilising investments in and utilization of low-carbon technologies. Carbon pricing and carbon markets should be the key elements of the framework.
The transformation to a low-emission society requires major investments and financing. Therefore, policies should promote the lowest-cost ways in order to keep the total cost burden affordable. It is also obvious that public sector cannot alone cover the considerable annual costs of transformation, and the private sector will be in a key position, both in initiating climate mitigation activities and in raising funding for them. It should, however, be backed by clear targets and predictable, long-term policies.
Emissions trading is a fair tool to steer investments: the cost burden is the same for all CO2 emitters. This means that always the cheapest sources of emissions reductions are exploited first, keeping the total cost of climate change mitigation on the minimum level. Furthermore, it promotes the competitiveness of clean and energy-efficient technologies by creating demand and market pull for them.
At Fortum, climate change mitigation has been a key part of our strategy for a long time. We take concrete steps to develop cleaner, smarter and more efficient solutions for electricity and heat production and use. As an example, we are building a new bio-fuelled CHP plant in Stockholm, Sweden, together with the City of Stockholm. This plant, which is to be commissioned in 2016, will be one of the largest bio-CHP plants in the world. Read more on our climate benign investments at fortum.com/futureenergy.
We are currently finalising our new strategy for the next years. One of our key targets will be to increase investments in renewables. For us this means, above all, hydro, solar and wind power as well as bioenergy. We are also continuing the research and development of new emission-free energy production methods, such as wave power and pyrolysis. Another key area for us will be modern energy services and solutions that help our customers - whether private consumers, companies or municipalities - use energy in a smarter and more climate benign way.
Climate change mitigation is a global issue and all measures to reduce emissions count, wherever they are made. We are calling on all actors in society to join the effort to tackle climate change. Let's make this moment the turning point when the transition in a low-emission and climate-resilient economy becomes inevitable, irreversible and irresistible.
Fortum is committed to finding new and more efficient ways to produce energy in a climate friendly manner. I encourage all Fortum employees, our suppliers and customers to think about how they can also be part of the solution. We must, we can and, together we will battle climate change.
President and CEO