Green Paper With Green Electricity

7/30/2019 Green Paper With Green Electricity

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Energy Policy 31 (2003) 641655

Green paper with green electricity? Greening strategies of Nordic pulp

and paper industry

Jyrki Luukkanen*

Finland Futures Research Centre, Turku School of Economics and Business Administration, P.O. Box 110, FIN-20521 Turku, Finland

Abstract

The article studies the opinions of paper producers in Finland and Norway and Finnish power producers about the eco-labelling

of electricity and its possible effects on pulp and paper industry. The point of departure in the study is how large industrial

consumers mediate concerns of environmental issues to the producers. Based on interviews of environmental, energy/power andmarketing sector representatives of the companies the article analyses different views related to the criteria of green labelling, green

electricity and papermaking, energy sources as image sources, environmental image of papermaking and the threats and

opportunities the companies face in the changing international context. The analysis of the interviews is contextualised in the

endogenous market based regulation framework of electricity market regulation.

r 2002 Elsevier Science Ltd. All rights reserved.

Keywords: Environmental labelling; Green electricity; Paper production

1. Background

In the beginning of the 1990s the Finnish paperindustry had to change its behaviour in relation to the

origin of the wood they used. Customers in Germany

and Britain required that the wood for paper products

should not come from old growth forests or clear

cuttings. Finnish environmental organisations had long

been demanding the conservation of old growth forests,

however, the forest industry failed to react before the

issue gained publicity in Germany and Britain. The

critical article concerning clear cutting published in Der

Spiegel in November 1993 proved to be very influential

in the debate. The reorientation of wood procurement in

Finnish industry took place in a very short period of

time after the issue had been raised in international

public debate. In this case, therefore, the consumer

attitudes were seen as a vital condition for papermaking.

This case inevitably raises interesting questions: What

kinds of processes have taken place in this change?

Another interesting aspect related to the question of the

origin of wood is: Why should wood be the only factor

of production, which is to meet the criteria of environ-

mental sustainability in papermaking? It would be quite

logical to widen the scope of the criteria to other factors

of production, too. Energy, in particular, constitutes an

important factor of production in pulp and paperindustry. In Finland pulp and paper industry consumes

about one-third of the total electricity consumption (see

Figs. 1 and 2). Should the consumers require also

sustainability in energy production?

After de-regulation of the electricity market it has also

become possible to choose which electricity production

to pay for. Once it is possible to buy green electricity

on the market, consumers may also set requirements for

this factor of production. Should, therefore, the

consumers require also sustainability in energy produc-

tion for papermaking? Does consumer action provide an

appropriate opportunity to reshape the operation of the

industry in a greener way?

In the case of paper production and environmental

labelling the decision making chain from the energy

production to the final paper consumer is long and

ramified. The situation is quite different from the case of

private electricity consumers buying green electricity,

where the consumer is directly in relation to the

producer. Private consumers seldom buy paper products

as such but consume them in the form of printed

products or packaging. This means that the role of

printing houses or packaging industry is essential in

the decision making of the paper qualities. These*Tel.: +358-3-2157036; fax: +358-3-2157311.

E-mail address: [email protected] (J. Luukkanen).

0301-4215/03/$ - see front matter r 2002 Elsevier Science Ltd. All rights reserved.

PII: S 0 3 0 1 - 4 2 1 5 ( 0 2 ) 0 0 1 4 9 - 0


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intermediary actors can, of course, mediate private

consumer concerns of, e.g. environmental issues to

the paper and energy producers. The role of few large

customers can be substantially important in the re-

organisation of the demand as was seen in the case

of the above mentioned old growth forest debate. Hence

the possible changes in the demand side can also

be much faster than in the case of a large number of

private consumers. This fact increases the importance

of the labelling process from the point of view of

producers.

The aim of this paper is to study the process

concerning the labelling of environmental aspects of

the energy used in papermaking. This is done by

evaluating the opinions in Finnish and Norwegian pulp

and paper industry and main electricity producers in

Finland about the threats and opportunities that are

seen in relation to green electricity. Several interviews

have been carried out to map the ideas of the people

within the industry representing environmental, energy

and marketing sectors in the companies. The companies

that were interviewed are UPM-Kymmene, Mets.a-Serla,

Norske Skog, Fortum, PVO and Vattenfall. The inter-

views are listed in the appendix.

2. Market-based regulation

The typology of approaches to environmental regula-

tions presented by Midttun and Koefoed (1999) forms a

good basis for discussion about policy instruments. In

this article market endogenous regulation, based on eco-

labelling, is studied. Eco-labelling programmes seek to

achieve their primary goal of reducing environmental

impacts by encouraging consumers to shift their

purchases from more harmful to less harmful products

within the same product category.

The concept of eco-labelling rests on four proposi-

tions (Harrison, 1999). First, it is assumed that mean-

ingful certification criteria can be developed to

distinguish among products based on their impacts

across the product life cycle.

Second, it is assumed that manufactures and retailers

will compete to respond to consumer demand for less

environmentally harmful productsin other words,

manufacturers will apply for certification when their

products are eligible. The combination of these first two

assumptions is necessary to ensure that increasing the

market share of labelled products over non-labelled

products will, indeed, do good for the environment.

Third, it is assumed that consumers are really

motivated by environmental concerns. In this regard,it is noteworthy that contemporary eco-labelling pro-

grammes represent a departure from environmentally

oriented product claims popular in the 1970s and 1980s,

including claims of energy efficiency and reliance on

organic farming methods, which were directed at

consumers immediate self-interest. In contrast, the

second generation of labelling programmes relies more

heavily on consumers altruism, that is, their willingness

to consider environmental impacts felt by all members

of society.

Finally, it is assumed that consumers will recognise

and trust the label. An eco-label thus will enhance the

market share of a labelled product only to the extent to

which consumers have greater faith in the label than in

comparable information provided by the manufacturer,

competitors or other sources such as environmental

groups.

Contrary to assumptions underlying the eco-labelling

model of endogenous environmental regulation, eco-

labels may not always reduce environmental impacts by

shifting consumer purchases to environmentally pre-

ferred products for three reasons (Harrison, 1999). First,

to the extent that laggard firms, which seek certification

without additional investment in process or product

16 %

28 %

16 %

2 %

9 %

8 %

11 %

10 %

Hydro

Nuclear

Coal

Oil

Gas

Peat

Biomass

Import

Fig. 2. Electricity generation by energy sources in Finland in 1997

(Statistics Finland, 1998).

32 %

23 %

45 % Pulp and paper

Other industry

Non-industrial

Fig. 1. Finnish electricity consumption (73.8 TWH) distributed on

sectors in 1997. Source: Statistics Finland (1998).

J. Luukkanen / Energy Policy 31 (2003) 641655642


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modifications, influence the standard setting process,

the criteria for eco-labels may be too lax. As a result,

the eco-label may yield minimal environmental benefits

and it may indeed undermine the competitive position

of genuine environmental leaders within the industry.

Second, if effectiveness of eco-labelling is predicated

on a model of market competition, it is assumedthat producers are willing to compete on environmental

grounds. However, evidence of industry boycotts of

eco-labels, of even those who could qualify for

certification, suggests that the assumption does not

always hold. The recent decision by the Nordic paper

industry to discard the Nordic Swan eco-label is

an example of market behaviour, which undermines

the arguments of effectiveness of eco-labelling. Finally,

the concept of eco-labelling assumes that consumers are

eager to buy products that pose fewer burdens on the

environment.

3. Labelling of electricity and environmental regulation

Market endogenous regulation, based on consumer

choice, depends on the information flow the consumers

receive and accept. Supplying the products with

environmental labelling represents one way of affecting

the information the consumers receive about the

environmental effects of the products they consume. In

the following chapter environmental labelling of elec-

tricity and its relations to production and marketing of

pulp and paper are discussed.

In the case of forest certification the situation in thedifferent Nordic countries is different. In Sweden

the FSC certification has been accepted but in Finland

the fight of the certificate is still continuing. The forest

owners and forest industry have agreed on PEFC

certification, but the environmental NGOs still want to

have FSC.

In the case of labelling paper products, criteria based

on the sources of energy used or the emissions produced

are possible. Definitions of the criteria, which should be

used in the labelling, are defining which are the essential

components and which are not, defining the importance

of the selected components, etc. The different actors

have different interests, different resources, and they

base their arguments on different knowledge claims.

Therefore it is not possible to have neutral, objective

definitions based on scientific facts.

The questions on who should be in a position to

define the criteria and who will accept the defined

criteria are interesting. It is the credibility, acceptability

and trust of the different actors, which determine the

dynamics of the argumentative game. In a scientifically

oriented society the role of science based arguments is

often essential in the process of achieving credibility.

Actors defining the concept of green electricity have to

base their definitions, at least to some extent, on

scientific argumentation.

It can, to a certain extent, be claimed that the

legitimacy and reliability of the labelling is ultimately

defined by the consumers, who alter their market

behaviour based on the information provided by the

labelling. However, often the labelling process itselfand the marketing of the products determine the

outcome.

In the environmental labelling of electricity the main

idea is to encourage consumers in the market place

to increase the demand for electricity based on renew-

able resources. This, in turn, will result in changes in the

electricity production structure once the producers have

responded to the changes in demand (Fig. 3).

The arguments related to competitive electricity are

illustrated in Fig. 4, and uttered mainly by representa-

tives of the heavy industry and power companies. This

argument relates, for example, technological and energy

economic issues to competitiveness of industrial com-

panies in the international market and the related socio-

economic effects ranging from employment to GDP

growth and welfare.

Electricity

production

Nuclear

power

Electricity price

Quantity

Reliability

Economic

performance

of heavy industry

Competitiveness of

nation state

GDP growth

Employment

Welfare etc.

Fig. 4. Characterisation of the factors connecting electricity produc-

tion to GDP growth and welfare.

Environmental

labelling

Information

flow

Consumers

Market

mechanism

Structural

change

Electricity

production

Renewables

versusFossil & Nuclear

Environmental

problem

Fig. 3. Characterisation of the issues connecting the environmental

labelling of electricity to the environmental problem.

J. Luukkanen / Energy Policy 31 (2003) 641655 643


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The competitive electricity argument forms the

basis of the main counter arguments against green

electricity. The situation has, however, changed to some

extent. At the end of the 1990s in Finland the large

advertisement campaigns of wind energy, carried out by

the originally Swedish power company, Vattenfall, have

forced Finnish power companies, too, to use newargumentative categories including green electricity.

In the following chapters labelling of green electricity

is analysed from the point of view of the different

arguments of the paper producers and power producers.

4. What is green electricity?

4.1. Criteria

There exist different criteria for green or renewable or

eco-electricity in the Nordic countries. The Swedish

Society for Nature Conservation produced their criteria

for bra milj .oval in 1995. The Finnish Association for

Nature Conservation followed with the Norppa eco-

energy label in 1998. Both of these organisations have

renewed their criteria in the beginning of the year 2000.

EU proposal for a Directive on access of electricity

from renewable energy sources to the internal market in

electricity defines criteria for renewable electricity. The

aim of the Directive is to establish common rules for the

treatment of electricity from renewable energy sources in

view of the completion of the internal electricity market

and in view of increasing the share of electricity from

renewable sources.In the interviews of the representatives of the paper

industry and power sector the term green electricity was

criticised by many of the interviewees. Most of them said

that the term green or eco is indefiniteit does not

define the concept clearly enough and the term has other

connotations

green as a word has bad connotations. It would be

clearer to speak of renewable energy. Some people

could even say that nuclear power is green because it

does not have CO2 emissions. But, if it were defined

that electricity, which is produced from renewable

sources, can be called renewable electricity, therewould not be any misunderstandings (UP)

The energy producers wanted to use exactly defined

concepts such as wind power, hydropower, etc. From an

engineering point of view the factual framing of the

reality seems more attractive than, e.g. moral framing:

for a small private consumer the term green

electricity might be suitable because they do not

understand the different parameters and emissions

related to the production process. Small consumers

base their decisions on images. Industrial users,

however, want pure facts because they understand

CO2, SO2, NOx, and other parameters. They know

what are the emissions from nuclear power, biomass

combustion or hydro production. (PP)

For the other power company the definitions of the

concepts were also problematic:

the term green electricity is not defined anywhere. It

exists only in the images of people. Everybody

understands that it has connections to environmen-

tally friendly production. (FP) On the other hand

the basic criterion is renewable/non-renewable or

fossil/non-fossil. The renewable should contain wind,

solar, biomass and depending on the restrictions also

hydro. Peat is still under consideration. (FM)

For the third power company

the criteria for green or renewable electricity defined

by the Finnish Association for Nature Conservation

are ok. The concept is understandable and will have

an effect, in the future, on the structure of energy

production system by giving signals what type of

electricity production consumers want. (VP)

For a paper company representative it was

totally incomprehensible why the criteria concerning

renewable electricity include restrictions for hydro

power plants with regard to the year when they were

constructedit is hard to accept that those con-

structed before 1996 are good and those constructed

after that are bad (UP)

Difference of factual and moral or emotional

approaches were emphasised:

an adjective describing a colour (green) is meant to

appeal to emotions, it is not connected to environ-

ment but to product marketing. The political defini-

tions of green electricity given by EU are not

interesting. At the company level green electricity is

not an issuethe company wants to stay at more

concrete than a declaration or opinion level. (UE)

Factual data based information was seen sufficient

in the internal reports the fossil CO2 tons per product

ton are calculated, but this issue has not been

discussed even with the main customers. For the

customers it is enough to know how much energy as a

whole is used and how much CO2 is emitted. (UE)

These examples show the importance of the scientific

argumentation for the credibility and acceptability of

the concept. Political definitions cannot be credible

and legitimate. The knowledge base has to be derived

from scientific facts;

the term green is value laden, while the term

renewable implies a scientific background. (ME)



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Some of the paper producers, seemingly, preferred

defining green electricity as a marginal product:

yin any case it is a marginal product. Irrespective of

how it is defined, even all the green electricity in

Finland would not satisfy the demand for our

products. (UE)

This means that the concept and its legitimacy are

challenged. Marginalisation represents one possible

strategy in the struggle for a hegemonic position in the

production of discursive order. Hegemonic position

makes it also possible to define the issues under

discussion

green electricity is not discussed. If the customers

raise the question, we try to show the facts and

explain our position (UE). We prepare, but do not

do anything before the market pressure is there

(NP).Green energy is not a very big topic at all.

(NF)

Prioritising different aspects is important for planning

the strategy of a company. In relation to environmental

issues

climate change is an issue as such, not the

orientation from the point of view of marketing or

customer needs. The priority number one issue is

energy efficiency. The second issue is bioenergy,

which can be called wood energy, renewable energy

or carbon neutral or climate neutral energy. (UE)

The time perspective may be important in the

definition of reality. The world can be seen as a process,

which is changing constantly

criteria and labelling may be important in the future,

but at the moment the production volumes are so

small that green electricity is not important. If

biomass based fuels are counted as green energy,

then it could be very important. It could form a

remarkable argument in the marketing, if all chemical

pulp production is considered green because it is

based on biomass energy. (MM)

4.2. Who should define the criteria?

There seemed to be rather different views about who

should define the criteria. The legitimacy and reliability

of criteria setting represent conditions that are in the

centre of these discussions. This is also connected to the

wielding of power in the energy market as criteria setting

has an effect on the structure and operation of the

market. This makes the issue rather delicate. In the

struggle for determining the label and its qualifications,

the credibility, acceptability and the trust of the actors

play a central role. It seems that the credibility of green

labelling is not accepted in a straightforward manner.

It is not a good situation, where an environmental

NGO defines the criteria. A neutral authority should

be responsible for defining the criteria. (PP) ... in

the long run the authority that defines the criteria

should be somebody else than an environmental

NGO. Probably the Ministry of Trade and Industry

together with the Ministry of Environment could bethe right authorities to define the criteria. (VP)

Environmental NGOs are not neutral from the

viewpoint of consumers. Some official organisation

should define the criteria. In the international level it

should be EU. (FM)

On the one hand

anybody can create their own criteria, but then it is

up to customers to decide whose criteria are reliable

and acceptable. There are at the moment producers,

who sell green or eco-electricity with their own

criteria, but there is a threat that this may lead tomisinformation compared with the case that the

criteria are set by an outsider. Important is, however,

that the actor who sets the criteria, works in close co-

operation with the electricity producers and sellers.

(FP)

On the other hand

somebody has to start the defining of the criteria and

check how the markets react. The situation is

changing all the time and the criteria are also

developing. (FM)

The criteria do not have equal impact on all producers

and that is why the position to define suitable criteria

was seen important:

The Nature Conservation Union had a preparation

group for the criteria, where also industrial partners

were present. However, it did not represent the ideas

and opinions of the whole sector. Every partner in the

preparation group was just defending their own rights

and demanding criteria that were suitable for them.

(PP)

The final decision was seen to be up to the consumers,who have to decide which criteria to rely on.

Anyone can create his own criteria but it is up to the

customers to decide whose criteria are reliable and

acceptable. (FP)

However, the information supplied to the consumers

by positioning the actor, who does the labelling can be

of crucial importance for the acceptability of the criteria.

If the labelling organisation is positioned as an

unreliable, biased, green NGO, the credibility of the

labelling will be seriously questioned.



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5. Green electricity and papermaking

5.1. Environmental quality label

The labelling of green electricity is, in the case of pulp

and paper production, connected to the labelling of

paper products. The next question is what kind ofenvironmental labelling of paper products is necessary

to give enough information to the consumers so that

they can make informed decisions. Are the on-off type

labels sufficient or should the consumer get information

about different emission factors and efficiencies. What

type of information is desirable from the point of view

of producer?

The type of information and its producer and the

formulation process of standards are crucial for cred-

ibility. In this case, scientific argumentation based on the

study work carried out within the paper companies,

presented a point of departure for defining and selecting

certain standards for labelling.

The labels give information about energy use and

emissions related to different products. In the

technical sphere there are certain standards about

the information of products, but in the environmental

sphere the standards are under development. In the

future the calculation of the carbon balance of

different products will be a standardised practice.

(UM)

Life cycle based approach seemed to be emerging in

the labelling process.

Quality monitoring is widening its area from techni-

cal aspects to include environmental and also social

aspects, it becomes multidisciplinary. The customers

can require information of the whole production

chain and there is always a risk that, if any supplier

or subcontractor in the chain has bad reputation, it

will also be associated to the final product. If there

are customers, who want to know how the products

are manufactured, and are willing to pay for some

qualities, also the transparency of energy chain

becomes important. There will always be some

vanguards and others are forced to follow. (UM)

Large amount of information and labels was also seen

problematic:

Today there are so many environmental labels (such

as Nordic Swan, Blaue Angel, etc.) that the con-

sumers do not know what is behind them and

whether they are comparable (NM).

Environmental labelling of paper would be important

in the future. Marketing people

could easily imagine that in the future the company

would be selling paper, which has an energy label

showing that it is produced with renewable energy.

The label should contain indicators of electricity,

resource productivity and eco-efficiency. This would

be comparable to information that, e.g. child labour

has not been utilised. Important here is the reliability

of monitoring and evaluation system. (UM)

The paper industry is preparing its own set of criteria

for labelling of paper

within the Nordic countries among different in-

dustrial sectors there have been plans to create

indicators of emission coefficients per product ton.

(UP) There is ongoing preparation work in the

Nordic countries for the energy and emission criteria.

The work is connected to the Nordic Swan label, but

there is also other preparation work going on. (MP)

It was seen important that the industry is active in the

labelling work to secure that the criteria are suitable.

There is preparation work going on to produce

information for industrial customers, who need more

detailed information than just on-off type labels. In

this respect the industry is acting in time, while the

customers in Western Europe have not got ac-

quainted with the issue. (ME) The industry has

calculated life-cycle information case-by-case for

different products about the CO2 contents of

different paper types. But the customers have been

surprisingly little interested in these issues. (ME)

When we have discussed with the big customers the

emissions have never been a subject. The price is still

most important for the customer in addition toprintability and runability, although the emissions as

such are important. (NM)

For marketing purposes green labelling offers inter-

esting possibilities.

Green label for all chemical pulp could be a really

interesting option for Finnish paper industry because

Western European industry cannot compete with

that. (MM)

The industrial customers of paper products seem to

become more interested in the use of labelled energy.

The big industrial consumers have been interested in

how the power company has produced the electricity

and asked whether it is CO2 free. It seems that in the

future also forest industry has to react on the demand

by the customers. The CO2 emissions are a critical

factor today in the negotiations in the electricity

market and it seems that the role of environmental

image is increasing all the time. The CO2 emissions

are today much more important than SO2 or NOxemissions due to the Kyoto Protocol. (VP) The

trend in paper production and marketing seems to

be that the emissions per ton of paper have to be



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calculated and expressed based on information of

life-cycle analysis. The trend is that all the time more

accurate information is needed. (PP) We prefer

calculating CO2 tons per paper ton, because it is more

informative to customers than green electricity.

(NP)

The marketing of paper products based on green

energy is still in its initial phase.

Some Swedish forest companies have advertised that

they have clean CO2 free energy sources, but the

volume of the advertisements has still been quite

small. The Swedes seem to be quite good in

environmental marketing, but there have been no

over reactions yet. The Finns have been quite poor in

environmental marketing, but the trend seems to be

that the energy related environmental marketing is

growing all the time. (PP)

5.2. Different paper types

The increase of mechanical pulping has been a trend

in the 1990s in Finnish paper production. Mechanical

pulping requires a lot of electricity, but the amount of

pulp per ton of wood is twice as big as with chemical

pulping. Chemical pulping, on the other hand, uses the

waste liquor as a source of energy and in the process

more energy is produced than consumed. Chemical

pulping is from the point of view of CO2 emissions very

tempting alternative because it uses only biomass-based

energy. Chemical and mechanical pulps have, however,different qualities and they are suited to different types

of paper. Now the question is, does the importance of

CO2 emissions have an effect on the production volumes

of different paper types? Will the less CO2-intensive

paper types increase their share?

There was quite a lot of scepticism among the paper

companies about the environmental impact on produc-

tion shares of different types of paper.

It does not have an effect. The demand of different

paper types does not depend on the supply but on the

demand. In the longer perspective the Finnish paper

industry as a whole will retain its orientation inproducing electricity intensive mechanical pulp.

(UE) The environmental issues will not have an

effect on the production volumes of different types of

paper. The printing houses will continue to demand

certain types of paper, which are thin and opaque.

This, of course, decreases the possibilities for

recycling. (UP) Energy or environmental policy

will not have any effect on the production of different

types of paper. (ME)

The marketing people had, however, different views

of the situation.

The environmental requirements might, in the long

run, have an important effect on what types of paper

will be produced. If the consumers or printing

industry sets such requirements, the paper industry

has to react. (MM)

This shows that views about reality may vary

considerably even within these companies.

5.3. Attitudes of customers

Are the customers aware of the environmental aspects

of different paper types and do they demand CO2 or

nuclear free paper? Who can determine the information

flow and construct the reality in a credible way?

The company has not used green electricity in

marketing but a Norwegian company has used it.

The company is producing information of, e.g. how

much CO2 is emitted per paper ton and customers,

especially in Germany and Switzerland and to some

extent in Britain and France, are interested in these

facts. (UM)

In the interviews there seemed to be a certain

tendency to rely on the fact that other producers base

their production on coal and the customers are not

aware of these aspects.

The role of coal power is still large in Europe and

there are a lot of products that are produced with

coal energy without any complaints. There have been

no requirements from the customers about the energy

used in paper production. (UP) The customers inWestern Europe do not even seem to understand

what is the question. An environmental chief in a big

German mail-order catalogue-printing house did not

understand, why the energy used for the papermaking

would be interesting. (ME)

The changes in the environmental requirements have

been quite fast in the past.

Environmental pressure from consumers has aroused

in waves, which have emphasised only one aspect at a

time. Once it was chlorine, next it was recycled fibre,

now it is forest certification. Carbon dioxide as an

issue has a different history of development. Govern-

ment officials in the international negotiations guide

the development of the CO2 policy formulation. So it

is not probable that the media will raise this issue as

an interesting topic, because the official policy

makers will take care of the issue. But in any case,

the company has to be prepared for the possibility

that customers may become interested in the issue.

There are some big customers, who collect informa-

tion about emissions and build up ranking-lists for

the paper products they are using. But so far they

have bought from all suppliers to be able to have a



8/15

competitive price. But if the issue will be raised in

public debates, there will, of course, be some changes.

(ME)

The environmental requirements in the future are still

under debate.

The customers have not asked what are the energysources of papermaking. Recycling has been an

important issue in the discussions, and, to some

extent, energy connected to recycling as an energy

saving issue. (MM) There has not been any

pressure by customers on how we produce energy.

The customers are, of course, interested in general,

but so far, there is nothing they worry about (NM).

The customers (owners of the power company) are

naturally interested in renewable energy. Nobody is

planning to build a coal power plant. Natural gas

seems to be attractive for the customers and also

nuclear power because its emission components arezero in practice. But the renewable energy is most

popular at the present energy political atmosphere.

(PP)

6. Energy sources as image sources?

Does the green electricity concept confuse the situa-

tion in the energy markets? Do the different energy

sources have an impact on the image of the energy

producer and the energy using forest industry? Do the

companies have to choose certain energy sources in

order to be competitive in the market in the long run?

6.1. Nuclear energy

Finland has four nuclear power plants, which produce

about 30% of the total electricity consumed in

the country. There has a long time been quite heated

debate whether a fifth nuclear plant should be built. The

parliament voted against the plant in 1992, but a new

application for the fifth plant was delivered to the

government in November 2000. The Finnish situation

seems to be quite different from the other Western

countries, where the trend with the nuclear energy isdecreasing and not increasing. Will construction of new

nuclear capacity affect the image of energy producers or

the consuming industry?

The image of nuclear power was constructed differ-

ently within the marketing and environmental/energy

sector of the companies. While accepting that

the opinion of the marketing person is more

important than the opinion of environmental sector

the environmental sector claimed that in a short

term the growth of the nuclear share in electricity

supply does not affect the image of the company.

Also in the long run there are no signs that that

would affect the image of Finnish nuclear power.

Rather it is a question whether the company will be in

paper business and will it be producing printing

paper. (UE)

The marketing sector had a totally different opinion.

The nuclear energy is a threat to the image of the

company, if new capacity is built. During the last ten

years nuclear power plants have been constructed

only in East Asia and it would be difficult to make it

pass referendum in any democratic country today.

The customers are usually critical, well informed and

aware of these issues and they see nuclear energy as

an out-dated issue. Those within the company and

energy sector, who promote nuclear issue, are

committed and directed to support it from other

than technical and economic perspective. (UM)

In the energy sector of the company the approach wasfactual:

the attitude towards nuclear power is quite neutral. In

the main marketing area, in Western Europe, most of

the electricity is produced with nuclear and coal

power. This is why Western Europeans are not in a

position to tell that they want paper, which is

produced with renewable energy. (UP)

The approach of another forest company was that

the role of nuclear energy is also very important,

because it does not have CO2 emissions. It is a fearful

thought that it would not be available. It is notunderstandable why nuclear energy should have

something to do with the image, if it is operated

carefully. (ME)

The reference to other countries operating nuclear

power was one of the main arguments:

nuclear energy has not, so far, been a risk for the

image of the company. All the countries in the main

market area, Germany, France and Britain, rely

heavily on nuclear energy, so they cannot blame us

very much. A new nuclear power plant could be a risk

for the image, because the trend internationally is not

to build new plants but to close the old ones. A new

plant would certainly raise public debate in the

newspapers and this would affect the image. (MM)

Nuclear energy seems to raise a strict division in

opinions:

the attitude towards nuclear energy is twofold, half

are pro half against. The application for the fifth

nuclear power plant does not mean that the power

plant will be constructedit is just an option. The

decision of investment will be difficult because you

should be able to know what is the situation after ten



9/15

years with electricity supply and demand, what is the

price level, what is the peoples attitude, have there

been accidents, etc. And not only what is the situation

after ten years but also after 25 years because the

plant must be able to pay back the investment costs.

(FM)

Nuclear power is both/and issuesome peoplepromote it, some are against. This is different with

coal power, which has a totally negative image. But

the economic risks related to nuclear power are, of

course, much bigger nowadays than during the closed

markets. The risks to build the power plant alone are

too high for a company that has its shares in the

stock exchange. (FP)

The reality that Finland is the only Western

European country, which has plans to build new

nuclear power, does not affect the image. The

situation in Finland is different from other Nordic

countries because in Finland the demand for elec-

tricity is still continuously growing. The growth of

electricity consumption in Finland is about 2% per

year and the increase comes mainly from industry

and service sector, which is still quite underdeveloped

in Finland compared with other Nordic countries.

The forest sector consumption is not growing very

much because it is investing mainly in foreign

countries due to the lack of wood resources in

Finland. (FP)

The other power company had an opinion that

nuclear power has not caused negative image to the

company in Finland. The consuming companies areespecially interested in CO2 free electricity, but they

do not have special nuclear-labelled electricity. The

building of a new nuclear power plant would have a

negative effect on the image of the company. (VP)

The third power company saw that

the risk related to nuclear power will be carried by

their consumers (owners of the power company). The

climate policy issue has increased the acceptability of

nuclear power in some circles because it is an effective

way to produce large amounts of CO2 free electricity.

It is very attractive compared with renewable sources,which operate at smaller scale power plants. (PP)

On the other hand

there is social image risk related to nuclear power.

The big consumers do not see the risk at the moment,

but it might be difficult to sell nuclear electricity

directly to a small consumer. Nobody wants to sell

electricity labelled as nuclear electricityall other

product labels are available. Nuclear energy has

image risk in the same way as coal power has a very

clear image risk today. (PP)

It seemed that the nuclear option is mainly needed for

negotiation of the price of other sources of energy.

One dimension related to the playing with the nuclear

or coal card is the negotiation situation in the gas

price discussions. If the only alternative for the

company is gas and the competitors in the Nordic

market do not need gas, the company is in a difficult

situation. (FP)

In the research report Eco-labelling of electricity by

Technical Research Centre of Finland (Piril.a and

Ranne, 1998) (ordered by the Ministry of Trade and

Industry) the labelling of paper products according to

the energy used was seen threatening for the competi-

tiveness of the Finnish industry. The report said that it

would be in the interest of Finland to secure that

electricity labelling should not be used in any larger

(paper) markets before the criteria are satisfying. It was

seen essential for the criteria to have suitable classifica-tion for CHP and biomass based waste. It was also felt

important to secure that nuclear energy, which was

claimed to be environmentally beneficial according to all

neutral studies, is not punished because of anti-nuclear

attitudes.

6.2. Wind and solar power

Wind energy is generally seen as an environmentally

sound form of power production. The wind power

production is increasing very fast in many countries. In

Finland the production capacity is still very small

compared with most of the European countries. There

has been a lot of scepticism in Finland regarding wind

power, but what are the opinions of energy producers

and consuming industry?

There have been scenarios that solar-hydrogen

systems will, in the long run, be the most important

way of producing and storing energy. What are the

prospects according to the Finnish producers?

Engineering approach emphasising large scale and

proven technology seemed to be the dominating one.

Wind and solar power are typical green issues that

are not interesting for the engineers of the company.

During the foreseeable generations wind and solar

sources cannot produce enough electricity for the

production processes in paper industry. They are

marginal and no one believes that they will replace

the current base load production. (UE) The role of

wind power will not grow very important. The

offshore wind parks could produce bigger amounts,

but locating windmills dispersed is not a solution. In

any case, the most important issue is to cut the

growth of electricity consumptionthat is the best

way. (UP) The role of wind and solar energy

will remain marginal and there has to be really



10/15

remarkable changes in this country before they form

any option for the company. The company buys

extremely large amounts of electricity, which means

that they need a large power plant for supply. That

may be one reason why people in process industry do

not see that there are possibilities for these sources

the potential for their use is minimal. The idea of thedispersed production system is not natural for them.

There is certainly potential for those energy sources

in Finland, but they suit better for other types of

consumers. (ME) Wind is not a cost-effective

solution. (NP)

Even in the longer term the renewable sources were

seen marginal by the paper companies.

Large offshore wind parks still feel to be in a distant

future. And an important fact is that it is not windy

always. If there is a thousand-megawatt wind park

and the wind is not blowing, there has to be another

source of power. And the company needs continuous

smooth supply of power. (MP) Wind power is so

marginal that it could not have value even from the

point of view of image. There are no plans to produce

wind paper. Wind power may be suitable for other

purposes but not for forest industry. (MM)

The energy producers saw a lot of limiting factors for

wind energy.

The role of wind power would be steadily increasing

when the costs are decreasing. The environmental

issues, namely the scenery issues will be the limiting

factor with wind energy. Within ten-twenty yearsperspective wind power will, however, remain mar-

ginal. To reach even one or two percent share in the

electricity production in Finland requires heavy

investments and remarkable capacity increase, if we

do not follow the subsidy policy of Germany. (FP)

The other power company has, however, large plans

for wind power:

The company has plans to start a new big wind park

project of tens of megawatts. It is not a question of

image, but the need to acquire technological know-

how. The company must have own experience of the

technology and costs for future plans. The owners of

the company have given permission to start the

project, which means that the forest industry is

interested in the project and believes that it is, in the

long run, profitable for them. (PP)

6.3. Nordpool

The liberalised electricity market in Norway, Sweden

and Finland has a common Pool from where electricity

can be bought. So far it is not possible to buy green

electricityor coal or nuclear electricityfrom the

Pool. Would it be important to be able to buy different

earmarked types of electricity from the Pool to be able

to trace the emissions in the life-cycle analysis of

different products?

From the point of view of paper producer

it would be essential that the pool would sell different

types of electricity. This means that the suppliers

should sell, e.g. coal, nuclear, hydro, wind, etc. power

and the customers should not buy just megawatt

hours. It should not be just a stock exchange of energy

and power. At the moment NordPool is a place for

washing the emissions. The problem is that at the

moment the electricity is not traceable and this is

problematic, e.g. for the calculation of emission

balance. The company would naturally buy renewable

electricity from the poolalthough coal based power,

of course, has its share in the production and the

Finnish systems could not operate without it. (UP)

It is possible in the future that the emissioncomponent will be added in the pool electricity. If

you want to calculate emission components for

different products, then you have to know the source

of electricity. (MP)

One opinion of a paper company was quite strongly

articulated:

If the customers require renewable energy and the

pool only sells grey electricity without information of

the source, it is clear that the company will not buy

from the pool. In the same way as the company

avoids money washing and Mafia. But, at themoment, there are no signs of this type of require-

ments from the customers. (ME)

The naturtal development with the Pool energy

would be towards earmarked electricity. The stock

market is always based, to quite a large extent, on

different values and emotions and this could easily

lead to earmarking the electricity, too. The measure-

ment of the energy flows in the grid is important and

there will certainly in the future be somebody who

certifies green energy. (MM) You should organise

the earmarking of electricity and then let the market

design whether it is an option (NP).

The increasing electricity transfer via the Pool

makes it difficult to trace the earmarked or envir-

onmentally labelled electricity, which is negative from

the point of view of environment. In the long run also

the Pool electricity could be earmarked and this

would be a desirable direction in the development.

(VP)

6.4. Liberalisation of the electricity markets in Europe

What are the effects of the liberalising European

electricity market? Will the prices increase or decrease?



11/15

The situation of overcapacity in electricity production

has been of constant discussion after the de-regulation

of the market in Europe:

The situation when the prices of electricity are very

low within the liberalised electricity markets in

Northern Europe will pass by. It cannot be a long

lasting situation, where the coal fired power plants

start to operate immediately, when the price of

electricity exceed the variable costs, thus leading to

a situation, where the capital costs cannot be covered.

(UP)

The liberalisation of the markets in Western

Europe would probably not affect Finland. There is

lot of overcapacity, but it is mainly coal-based power,

and it is not probable it will be used to produce

electricity for the Finnish markets. It may have effect

on the price but also the availability of hydro

resources in Norway and Sweden has an important

effect on the price. The market price is at the momentat such a low level, which makes it impossible to

construct any new capacity. (MP)

6.5. Electricity production by the forest industry

Stora-Enso paper company announced in August

1999 that it is going to sell all its electricity production

capacity, which is not situated on-site. At the end of

1999 Fortum bought this capacity of 1511 MW. The

forest industry in Finland has traditionally owned most

of its electricity production capacity either directly or

through PVO, which sells electricity to its owners at the

production price. What will be the trend with the energy

production of forest industry?

The selling of the capacity might be a start of a trend

in the forest industry. Earlier the industry wanted to

be independent of IVO (nowadays Fortum, which

earlier had control over the Finnish electricity

transfer and a large share of production), but now

the companies have the opportunity to buy electricity

from anywhere and they need not be self-sufficient

anymore. In practice, all the industry will sell their

capacity in the future, because they do not have any

motive to be independent of IVO anymore. (FM)

One reason for selling the production capacity is to

concentrate in the core business of papermaking.

Selling the capacity will free a lot of resources. If the

market price of electricity is much cheaper than the

own production price, it makes the energy chiefs, and

shareholders, to think of the situation. (FP)

The trend in the forest industry seems to be that it

wants to sell the branches, which do not belong to the

core businessand energy production is one. It is

probable that UPM-Kymmene will not sell its energy

production in the short future because they do not

need money for investments, as was the case with

Stora-Enso. In an interview Marcus Wallenberg of

Stora has said that the paper industry will in the

future sell out the forests, energy production and even

pulp production, which are not the core business.

(PP)

7. Environmental image of papermaking

7.1. General environmental image

What are the issues that affect the environmental

image of papermaking? Who can affect the image? What

is the role of different actors in the construction of

reality of paper productionenvironment relations?

Who defines the criteria for assessing the relation?

One of the paper companies had a view that

the environmental profile of the company is very low

(in a similar way as with the other Finnishproducers). The Finns do not speak out loud but let

the activities speak for themselves. The company does

not have any intention to start to sell wind paper.

(UE)

The situation within the globalisation of economy has

impact also on the environmental strategy of the

companies.

The globalisation trend in the production has

changed the situation. A Norwegian company can

think that they use only renewable energy, but they

may have a factory in France, which uses nuclearenergy. So the companies can no more use the criteria

of only one country in their marketing. The

internationalisation of the sector has made the

activities more neutral. (UP)

The complexity and interlinkages of environmental

issues were also emphasised.

It has been irritating that the environmental image is

usually linked to only one aspect at a time. It would

be important to have all these aspects included. In the

marketing these environmental issues will be given

some emphasis, but mainly as a normal everyday

routine. The main environmental issue that the

company wants to emphasise is the idea of material

saving in product design, which means making the

products lighter, more economic packaging, decreas-

ing the square weight of the papers. (ME)

The large share of biomass fuel in pulp and paper

industry was seen as an opportunity in the marketing.

In the marketing the company promotes the large

share of biomass energy in papermaking. But because

the big company has several different energy sources

and several types of paper, it does not emphasise the



12/15

energy aspect very much. (ME) The company has a

clear policy to increase the share of biomass energy

independent of the issue whether it is used in

marketing. (MP) The energy issues are pushed by

the marketing because the company has lots of

positive issues to tell to the customers. The customers

usually do not know enough what are the positiveissuesthey ask about the negative environmental

issues and suspect that the company is hiding

something. (MM) Of course, we emphasise in the

brochures that we use clean and renewable energy,

but this may become important only if all the aspects

of the products are equal, including price. Renewable

energy may become an issue in the future, when other

issues have been taken care of, including, forestry,

waste paper use, chlorine free production etc. (NM)

The technological know-how related to bio energy use

was seen as an important opportunity.

In any case, the possibility to use bioenergy is a

distinct opportunity that other industrial sector do

not haveforest industry has the know-how, tech-

nology and logistics to get the woody biomass out of

the forest. (ME) When there are possibilities, the

company tries to replace other energy forms with

biomass. Another aspect is the combined heat and

power production, which is promoted both by

economic and environmental reasons. Gasification

of biomass or black liquor is, at the moment, in a

pilot phase, but in the future it has a good potential

to increase the electricity output. (MP)

From the point of view of a power company

the environmental image of energy producer is

naturally connected to the fuels that are used for

power production. If there are any good alternatives,

it is sure that the company will not invest in coal. The

policy of the company is not to exclude categorically

any alternatives, but it is possible to prioritise them

and coal has certainly the lowest priority from the

environmental perspective. Coal is certainly also a

risk for the image of the company. Oil has, in any

case, been out of the question in power production

for a long time. (FP)

7.2. The role of consumers

What is the effect of consumer behaviour on the

activities of the companies? The building of the image of

the companies and the information flow to consumers is

an essential part of the company activities in framing of

the reality where the consumers operate.

A change in the energy markets from supply driven to

demand driven has triggered a shift in the strategies of

power companies.

The whole idea of the company is based nowadays on

services, not on selling large amounts of cheap

electricity. Todays chaotic phase after the liberal-

isation of the markets will pass by quite soon and

after that there will be demand for different services.

The company has a lot of expertise, which can be

utilised in producing services. Advertising wind andgreen electricity has been based on the idea that if the

company failed to do it, it would build a lot of

negative image. (FM)

The environmental image is a precondition for all

companies today. Environmental issues and sustain-

ability are extremely central in the strategies and

targets of the company. The strategies are not based

on marginal products like green electricity, but the

whole production has to be based on sustainability.

Important is to be able to have environmental reports

of all the products and to show the customers, what

are the environmental impacts of the products they

buy. In addition the power plants have to be modern

and fulfil the environmental norms. The company

wants to be a predecessor in the environmental issues.

(FP)

8. Threats and opportunities

What kinds of threats and opportunities are linked to

the development of the energy sector and the environ-

mental issues?

In some cases the threats and opportunities were

spelled out distinctly:

The opportunity is connected to emphasising publicly

the role of bioenergy and to intensify its use. The

threat is to rely on the single pipeline for natural gas

from Russia to Finland. Nuclear power is not a

threat for paper industry neither is the construction

of new hydropower. (UE)

Opportunities were also connected to larger issues:

The increasing emphasis on environmental issues is

an evident opportunity for the company. The increase

of environmental awareness and the skill to use it inthe development of the company and the sector is

essential. One hindrance of development is the

emphasis of short-term profit maximisation; the

company should be able to see both close and far.

(UM)

Pulp and paper industry, as well as heat and electricity

production, were seen to have good positions in the

changing environment. The reasons being that the

production is based on renewable raw material and, to

large extent, also on renewable energy resources and due

to the skills and know how:



13/15

The situation within the forest industry is very good

compared with most other sectors. Forest industry

utilises renewable wood as fibre and energy and has

very good possibilities to develop its processes also in

the future. (UP) The opportunities for the Nordic

pulp and paper industry are good because of the mix

of energy sources (NP). Bioenergy is the strengthof the sector. It is a natural fuel for the company and

the opportunity to increase its use is based on the

technology and know-how that the company has.

(ME) The opportunities of the power company are

based on the expertise it has and the ability to use

environmental know-how in the markets. The de-

mand for environmental products is increasing and in

the future it will be an important source of income.

(FM)

The production structures of the power companies

have an effect on their competitiveness in the changing

situation:

Green electricity is seen as an opportunity for the

company because the production structure of the

company gives it competitive advantage compared

with many other big companies. (VP) The com-

pany does not see the CO2 question as a threat to the

company. The CO2 emission levels of the company

are at about national average, so there is no

opportunity either. (PP)

The threats were linked to several issues:

There is a threat that the environmental require-

ments are an economic burden for the company. Thehope is that it would be an equal burden for all

the companies in the sector and it would not distort

the market situation. There is a risk if the company

relies too much on natural gas, which has only one

supply source in Finland. (MP) A clear threat is

the idea that the present nuclear capacities were not

available, because a large variety of different options

is important. (ME) It is a risk, if natural gas gets

too big role in the Finnish energy market. The risk

here is a market risk related to the monopoly

situation. The effectiveness of the energy sector has

long been based on the competitive situation in the

market and it is extremely important to preserve the

competitive situation. (ME)

Government operations were also seen as a threat to

the optimal operation of the market and the position of

the companies:

The threat is that the government sets restrictions

for the use of certain energy forms and thus distorts

the market systems and limits the possibilities of the

customers to choose products, which they think

are environmentally friendly. The effectiveness of

the present day system is based on the idea that the

consumers are educated and environmentally con-

scious and can direct the market by their own

decisions towards environmentally sound direction.

By applying artificial measures the government may

distort the system towards worse direction in

environmental sense. Energy taxes are an example,

which may affect the markets, and the prohibition tobuild new nuclear capacity would be another

example. If the alternatives are limited, it will direct

the markets in an artificial direction, which is also not

desirable from the point of view of environment.

(FP) There is a threat that the government officials,

in their own ivory tower, make strange decisions and

mess the markets. Our approach is not against

regulation, but regulation should be planned together

with the companies. (FM) If capacity, which is

build for tens of years becomes unavailable due to

environmental regulation, that is a waste of money.

The liberalisation of energy markets has not been a

threat to the company (unlike for the other power

companies) but the environmental regulations, such

like CO2 question, can be more threatening. (PP)

International differences in the regulations were also

seen as a problem:

A threat is that the regulations are different in

different countries. It is not a very big problem for

the companies, if e.g. Germany subsidises renewable

sources more than Finland, not even in the context of

increasing international trade. But if the rules are

different, e.g. in Germany for German and Finnish

companies, this will be a big problem. (FP)

Also national differences in the position of companies

in the case of changing regulation were seen proble-

matic:

There are threats also in energy taxes. They may

support some companies and oppress other compa-

nies. The increase in efficiency brought forth by

competition will lead to a better situation, even from

the point of environment, than the use of environ-

mental taxes to regulate some production forms. The

taxation system, which is not uniform in all countries,

is a threat for the company. (FP)

The problems with the electricity distribution sector

were well identified:

The monopoly that still exists in the transfer and

distribution system means that the low price of

electricity is compensated with the high price of

distribution although it is against law. The centre for

electricity markets does not have resources to control

the situation. (FM) The similar situation will

prevail in the liberalising European markets, but the

economic interests are there much bigger compared

with the Nordic situation. That is why the markets



14/15

will open quite slowly in spite of the EU demands.

(FP)

9. Conclusions

Eco-labelling offers an opportunity to affect the lifecycle of a product (e.g. paper) by directing consumer

choice to products, which produce less burden to

environment. However, eco-labelling also has its limita-

tions. If eco-labelling is effective, it can contribute to

shifting consumer demand from one product to another

in the same product category. It is interesting to see

whether the environmental aspects and especially CO2emissions will have effect on the production volume of

different types of paper with different CO2 intensities, if

eco-labels including energy or CO2 component will be

introduced. Eco-labelling cannot, however, contribute

to a shift from, e.g. printing paper to another product

category, e.g. to cardboard. Eco-labelling does not

either reduce consumption; it may even encourage it

by creating more environmentally friendly image of

consumption.

In a competitive electricity market the labelling of

green electricity offers one way of introducing environ-

mental information to help consumers make choices,

which could, in the long run, affect the electricity

production structure. This type of market endogenous

regulation highlights the existence of a self-organising

potential in the market. The role of consumers is central

here. The consumer concern, when mediated through

market behaviour, may make the industrial producerschange their behaviour.

In the case of paper production the labelling of the

paper products should contain information of the

energy use and energy sources in the production process.

This could give paper consumers possibilities to choose

products, which have been produced with, e.g. green

electricity, or to utilise some other criteria for

the decision making. In the case of paper products the

decision making chain from energy production to the

final consumer is often quite long. The private end users

of paper consume most of the paper products in the

form of printed publications and do not directly choose

the quality of the paper. This means that the printing

houses, in addition to the packaging industry, are

central in choosing the criteria for the decision-making.

The importance of the scientific argumentation for the

credibility and acceptability of eco-labelling seems

to be central in modern scientifically oriented societies.

The knowledge base of the definitions and labelling

criteria have to be derived from scientific facts or

argumented scientifically; political definitions cannot

be credible and legitimate. The scientific aspect is

reflected also in the discussion whether the electricity

sold in the NordPool should be earmarked. It can be

argued that earmarking would secure that the Pool is

not a place for washing the pollution, but more

important seems to be the possibility to construct a

way of calculating emissions related to papermaking and

to indicate that it is scientifically based.

The control of the information flow to consumers

about the paper products to enable informed decisions isessential for the outcome of the labelling process. Are

the on-off type labels sufficient or should the consumer

get information about different emission factors and

efficiencies? The formulation of standards is crucial in

the construction of reality and determining the legiti-

macy of the hegemonic discourse. In this case the science

based argumentation based on the study work done

within the paper companies forms the starting point of

defining and selecting certain standards for the labelling.

The present practice is that the producers define what

emission factors of the products they calculate. This is

an effective strategy to achieve hegemonic position in

the contestation.

The labelling of different products such as paper

requires several components in the production chain to

be taken into consideration. It sounds reasonable to

include the type of energy, which is used in the

papermaking processes, in the paper labels. According

to the interviews the CO2 emissions seemed to be the

most important environmental aspect connected to

paper production. The role of green electricity was not

emphasisedon the contrary the tendency seemed to be

the marginalisation of it. This is especially the case with

wind power. Hence the concept and its legitimacy are

challenged. The marginalisation is one possibility in thestruggle for the hegemonic position in the production of

discursive order.

One reason for the marginalisation of green electricity

might be the role of nuclear energy. Paper industry is

consuming a lot of nuclear electricity and this may be

the reason for the emphasis of CO2 free production.

Green electricity is likely to pose a problem for paper

producers because it may limit the use of nuclear power

as an energy source.

The legitimacy and reliability of the criteria setting for

eco-labelling are conditions that are central for the

process. The labelling is connected to the wielding of

power in the energy market, because the criteria setting

have an effect on the structure and operation of the

market. This makes the issue quite delicate. It seems that

the credibility of the green labelling of electricity is not

accepted straightforward. It can be said that the final

decision is with the consumers, who have to decide on

which criteria they can rely. But the information

supplied to the consumers by positioning the actor

who is doing the labelling, questioning the relevance of

the criteria etc. can be of crucial importance for the

acceptability of the criteria. There seem to be quite

different opinions about who should define the criteria.



15/15

Most of the interviewed people admitted that energy

sources are, at least to some extent, also image sources.

There were conflicting views about the role of nuclear

power as an image source. People from the environ-

mental and energy sectors of the forest companies

thought that nuclear power is not negative for the image

of the companies. On the contrary, the marketing peoplethought that new nuclear power would clearly be a risk

for the image of a company. In this case the different

views indicate the weakness of the hegemonic discourse.

Essential for the consideration of the labelling of

green electricity is a system that is credible, acceptable

and trusted. The credibility, acceptability and trust of

the different actors determine the dynamics of the

argumentative game and since the resources of the

actors are not equal, the labelling process can be biased.

Market endogenous regulation based on eco-labelling of

electricity can thus be seen as a complement, rather than

an alternative, to a wide range of other instruments of

governance.

Appendix

Interviews:

UPM-Kymmene/

environment (UE)

Hannu Nilsen 27.8.1999

UPM-Kymmene/

marketing (UM)

Marja Tuderman 25.8.1999

UPM-Kymmene/

energy (UP)

Juha Kouki 26.8.1999

Mets.a-Serla/

environment (ME)

Armi Temmes 6.9.1999

Mets.a-Serla/

energy (MP)

Jukka Kleemola 6.9.1999

Mets.a-Serla/

marketing (MM)

Erkki Peippo 6.9.1999

Fortum/energy (FP) Tuomo Kukko 8.9.1999Fortum/marketing

(FM)

Eeva Rauramo 8.9.1999

PVO (PP) Jouko R.am .o 8.9.1999

Vattenfall (VP) Heli Rissanen 13.9.1999

Norske Skog (NF) Hege Kristin

Olsen

18.10.1999

Norske Skog (NP) Svein Kroken 21.10.1999

Norske Skog (NM) Conrad Seiffert 15.6.2000

References

Harrison, K., 1999. Racing to the top or the bottom? Industry

resistance to eco-labelling of paper products in three jurisdictions.

Environmental Politics 8 (4), 110137.

Midttun, A., Koefoed, A.L., 1999. Efficiency, distribution and

negotiability: on the difficult tradeoffs facing environmental

regulation under weak governance. Paper Presented in Salzburg

Conference on European Energy Issues, Schloss Leopoldskrohn

1722 October.

Piril.a, P., Ranne, A., 1998. Ecolabelling of electricity. Technical

Research Centre of Finland, Research Notes 1905, Espoo.

Statistics Finland, 1998. Energy Statistics, Hakapaino, Helsinki.


Documents

Green Paper With Green Electricity