Finland’s Moonshots for Green Growth

In order to attract green investments, predictable and profitable operating environment is needed, e.g., in terms of taxation (such as electricity tax). Moreover, as recommended by the OECD, Finland’s government could more actively remove bottlenecks for foreign direct investments by streamlining inefficient and burdensome policies and reducing bureaucracy.⁸ Permit processes could be streamlined in construction and operational areas such as wind power development.

Finally, private-sector funding is often tied to short-term projects, and investors expect rapid returns. Yet government can support academia and first movers in scaling emerging technologies and bringing them to the point of commercialization by sharing the risk in pilot and demonstration stages. Fertile areas for R&D funding include, for example, industry electrification, energy use optimization, and circularity, especially in the emerging battery value chain.


8. The Organisation for Economic Co-operation and Development (OECD), The Impact of Regulation on International Investment in Finland, May 2021, https://www.oecd.org/daf/inv/investment-policy/The-Impact-of-Regulation-inInternational-Investment-in-Finland-Highlights-EN.pdf

To gain first-mover advantage and achieve economies of scale, sufficient demand for new offering is required. Often, companies scale abroad after first having conquered the home market. In the green transition, government can accelerate domestic demand through procurement policies. For example, government can increase demand for zero-emission buildings and wooden construction by renovating existing public buildings and opting for wooden building materials in new public construction (e.g., schools).

Government can also encourage private-sector demand and investments through incentives and policies. For example, zoning rules can promote wooden construction and net-zero living. Through blending mandates, government can catalyze the development and adoption of new sustainable fuels. Furthermore, subsidies can enable Finnish solution providers to pilot decarbonization technology and services domestically before scaling abroad.

Any one of the five Moonshots will require expertise and R&D to successfully take off. For example, wooden construction requires architects specialized in building with wooden materials, such as cross-laminated timber, while bio-based products and materials will need increasing know-how and resources in bioeconomy across industrial use cases. Consequently, revised or new higher-level education pathways and degrees are required to address the emerging expertise needs driven by the green transition. In addition to educating its own workforce, Finland should attract international students and workforce.

Acknowledging that the full potential of the Moonshots will require national coordination and strategic planning across ministries and public institutions, the Finnish government can build on its existing National Climate and Energy Strategy. For example, it can provide planning support for green hydrogen efforts that need access to renewable energy and freshwater.

Finally, developing competitive green offerings requires co-development and collaboration among different value chain players. Ideally, universities and research institutions also contribute to the broader ecosystem. Centers of Excellence can significantly accelerate the exchange of ideas, drive innovation, and facilitate coordination among ecosystem players. These Centers can also support in attracting investment, talent, and partners. By placing the Centers outside the capital region, close to the relevant natural resources, Finland can create jobs and drive attractiveness of less populated areas in Finland.

Finland can generate and channel green demand by positioning itself as a leader in green technologies. First, an easy-to-navigate online platform could showcase Finland’s comprehensive offering in green tech and decarbonization solutions in one place (similar to the one Denmark has on its State of Green website). By structuring offering according to key sectors, global companies could learn about the latest green technology and solutions applicable to their businesses, and Finland’s numerous green tech companies would get an effective go-to-market platform.

Second, Finland could organize an annual, world-leading Green Tech event in Finland (such as Slush) to gather together green tech companies, foreign investors, and global companies looking for green solutions. Finally, a green growth PR strategy promoting Finland’s spearhead offering and key milestones —such as the first circular battery or the world's first net-positive high-rise building—would earn valuable presence in international media and attract further interest toward Finland’s green offering.