3 Key insights from the Nordic case studies

The previous chapter presented 13 examples of Nordic climate action solutions, showcasing a wide range of solutions for achieving low-carbon pathways aligned with the objectives of the Global Stocktake Decision adopted at COP28 in 2023. This chapter discusses the key findings from the 13 case studies on climate action within Nordic countries. The key insights are structured around three identified key learnings and three critical enablers.

The first key learning from this study, is that all Nordic countries have over time demonstrated that ambitious climate policies can be combined combined with sustained economic development. For instance, in the early 1990’s, the Nordic countries were the first in the world to implement carbon taxes. These contributed to adopt renewable energy and reducing GHG emissions in mainly the heating sector, including district heating and industry’s own heating. Other examples of implemented policies include building standards, green certificates for wind power, subsidies for investments in energy savings, subsidies for low-emission cars (and increased tax for high emitting cars). Most of these policies have, in addition to reducing GHG emissions, also contributed to energy and cost savings. All Nordic countries present valuable climate action lessons, on how ambitious climate policies have led to the development of climate action initiatives, for instance the development of district heating systems, the development of renewable energy technologies such as wind, geothermal, sand batteries, the deployment of electrical vehicles and finally the case examples related to transitioning heavy industries such as green steel.

All of these initiatives showcase how the Nordic region has the potential to lead global climate efforts through scalable solutions, strong policies, and collaboration. Key sectors such as energy, transport, and waste show significant potential for emission cuts and without economic impact. National policies should include emission targets, sector strategies, and economic tools, while Nordic cooperation proved to be essential for accelerating the green transition (Landström et al., 2019).

The second key learning from this study is related to the fact that the Nordics demonstrates that low-carbon energy sources can be developed into a sound business case, while simultaneously support energy security. Several examples of successful renewables and enabling technologies such as district heating, wind energy, sand batteries and biowaste management systems implemented in the Nordics can provide scalable and replicable solutions globally.

The cross-Nordic case related to district heating exemplifies how district heating systems in the Nordic countries successfully have integrated renewable energy sources and contributed to the phase-out of fossil fuels. The shift to renewable energy sources like biomass, industrial waste, and geothermal energy in district heating systems has led to significant reduction of greenhouse gases, with some areas achieving up to an 80 per cent decrease. In Sweden and Finland, district heating systems utilize industrial waste for energy production, further cutting emissions. In countries such as Iceland, the adoption of geothermal energy has nearly eliminated the reliance on fossil fuels for heating purposes.

Denmark’s initiative on wind energy displays how the country has become a world leader in wind energy, thus serving as a model for countries in scaling up renewable energy. Currently, Denmark’s electricity consumption is estimated to be produced to over 46 per cent from wind energy, with projections to increase this rate to nearly 70 per cent by 2030.

The Finnish initiative related to sand batteries demonstrates a high-temperature solution that could reduce greenhouse gas emissions substantially. The widespread deployment of these innovative energy storage solutions, which can store intermittently generated renewable energy, offers a significant opportunity to both cut emissions and expand the renewable electricity sector's capacity.

The Norwegian initiative on advanced biowaste management systems demonstrates how a waste sorting plant outside Oslo, Norway, processes organic waste in anaerobic digesters to produce biogas and biofertilizers. Each tonne of biowaste generates approximately 900 kWh of liquid biomethane, which can replace 80 litres of diesel, reducing CO₂ emissions by 180 kg per tonne of biowaste compared to diesel. Additionally, converting around 45 per cent of household food waste to biogas, rather than composting, incinerating, or landfilling, could reduce emissions by 134,000 tonnes of CO₂ equivalent across Nordic municipalities.

The third key learning relates to fact that nature-based solutions have tremendous global potential in advancing the goals of the Paris Agreement by harnessing ecosystems to mitigate and adapt to climate change. These solutions include activities like forest conservation, reforestation, wetland restoration, and sustainable land management, all of which help sequester carbon and build climate resilience. In terms of mitigation, nature-based solutions can significantly contribute to reducing greenhouse gas emissions. For example, restoring forests and other natural ecosystems increases carbon sequestration by capturing CO2 from the atmosphere.

The Swedish nature-based solutions case presents a rewetting initiative that covered 115 hectares across different 35 sites. This project reduced emissions by 718 tons CO₂ equivalents. It accounted for about 12 per cent of Sweden’s total rewetting efforts that year, which involved 2,100 hectares and reduced emissions by 6,100 tons CO₂ equivalents. The initiative's long 50-year contract period makes it a significant measure for long-term climate mitigation.

The Icelandic initiative related to land restoration exemplifies that with existing measures (WEM) scenario projects a reduction of 266 kt of CO₂ equivalents by 2040 compared to a business-as-usual (BAU) scenario. While research on carbon levels in reclaimed land under the specific project is limited, a study in Southwest Iceland showed that revegetation with trees and grass significantly enhances soil carbon.

The first key enabler for successfully implementing the climate initiatives highlighted in this study is that climate action needs to be based on numerous policies. These polices should include innovation and investment support at an early stage. Carbon pricing and subsidies can be used to scale up new technologies, and standards and regulation to make green products mainstream. The government also plays an important role in providing relevant infrastructure, for example energy supply, effective permitting procedures, transport infrastructure including electric vehicles (EV) charging and infrastructure for transport and storage of captured carbon dioxide (CCS). Particularly transformative technologies, such as green steel, EVs and hydrogen-based industries require broad policy mixes to develop and mature.

The Nordic initiatives illustrate that policies need to be robust over time to create predictability for investors and lower their risks. The Danish wind energy projects emphasize the importance of stable, long-term planning.

Denmark's policy framework on wind energy emphasizes public participation in renewable energy projects, particularly wind farms, through various schemes that enhance public acceptance. It includes compensation for property value loss, property sale options for affected homeowners, bonus schemes for residents based on wind energy production, and funds for local community development. These policies have been crucial in reducing local opposition to wind energy projects and encouraging public involvement in the green transition.

CCS has been demonstrated successfully in Norway since the 1990’s. Now, Denmark, Norway, and Sweden are implementing or preparing national policies to promote investments in Carbon capture and storage (CCS), Bioenergy with carbon capture and storage (BECCS), and Direct Air Capture with carbon capture and storage (DACCS). These investments require strong financial incentives, that are largely reliant on regulators. The current EU ETS price levels are insufficient to drive substantial CCS investments. Since 2019, when the Helsinki Declaration on Nordic Carbon Neutrality was adopted, all Nordic countries have acknowledged the important role of CCS, and thus are jointly collaborating to its development. Moreover, the Nordic countries are engaged in innovative work preparing capacity and business models for receiving and permanently sequestering CO₂ as a service. However, the EU has not yet introduced specific policies to promote carbon removals via BECCS or DACCS.

The second key enabler is the inclusive approach to stakeholder engagement in the Nordic countries, which has been essential in building widespread support for carbon pricing. This broad engagement has helped to address concerns and ensure that the transition to a low-carbon economy has received a wide public acceptance. The Nordics have a tradition of including stakeholders into policy development, through public hearings and round-table discussions. This approach has established a foundation for climate policy that is supported or at least accepted by industries and citizens. It's often important to engage the local stakeholders to build support and acceptancy, seeking transition pathways that consider a just transition and avoids grassroot protest movement campaigns that can disrupt policy implementation.

Many of the 13 climate action initiatives, such as Iceland’s land restoration and geothermal heating projects, Denmark’s wind energy projects, cross-Nordic case on carbon pricing and Finland’s sand battery initiative, highlight the importance of engaging a broad range of stakeholders. Another important aspect is related to transparency in project planning, communication and implementation, as it strengthens trust between stakeholders and enhances collaboration.

The success of the Norwegian initiatives, electric vehicle (EV) adoption and biowaste management, demonstrates the importance of national political consensus and long-term government support.

Several cases, such as Finland’s climate network of municipalities, show that empowering local actors is crucial for climate action success. Regular stakeholder support, knowledge exchange, and local-level innovation foster a sense of ownership and ensure practical, context-specific solutions are implemented.

In summary, successful climate action initiatives hinge on multi-level, inclusive engagement that spans from local communities to national governments and the private sector. Clear and transparent communication it builds trust and reduces opposition, particularly in projects like CCS and wind energy where local concerns may arise, while ensuring that stakeholders are motivated by the long-term economic and environmental benefits of each specific climate initiative.

The third key enabler emphasises the numerous successful cross-Nordic collaborations between nations, industries, regions, and municipalities, as illustrated by the examples presented in this report. The success of the carbon pricing and green steel cases is built upon long-term, stable collaboration between the green steel, automotive industries, consultations with experts, environmental organizations, and the public. These partnerships, along with strong regional collaboration, has been essential in driving its success.

Many successful projects, including Sweden’s green steel and nature-based solutions thrive on strong partnerships between governments, private investors, and local authorities. These collaborations are essential, as they combine public sector resources and policy support with private sector innovation and funding, while ensuring that local authorities provide practical knowledge and implementation. Together, these stakeholders can effectively align interests, mobilize resources, and drive long-term, sustainable outcomes. By leveraging the strengths of each partner, such projects are better positioned to address complex challenges, scale up solutions, and deliver lasting impact.