The growing enthusiasm for the bioeconomy in Europe is encouraging, but it also creates a persistent sense of unease. The bowl of hope may be full to the brim, but will it soon run dry?

The European Union has defined its bioeconomy direction three times already. It developed its first bioeconomy strategy in 2012, reviewed it in 2018, and a year ago, the European Commission introduced a new framework for a competitive and sustainable bioeconomy.

The forestry sector has viewed these strategies with optimism, and there is reason to do so now; however, the very existence of a bioeconomy strategy and the optimism that follows do not guarantee that Europe will finally recognise the importance of sustainable forestry and the forest industry in achieving European climate goals, competitiveness, self-sufficiency, and security of supply – or, in other words, resilience and strategic autonomy. These priorities were just as well understood when previous bioeconomy strategies were developed.

The latest strategy offers a solid foundation. The Commission's goal is to expand the market for bio-based materials, ensure the availability of sustainable biomass, and accelerate investment and the commercialisation of innovation. The aim is to ensure that by 2040, sustainable bio-based materials are widely used across the European Union. One might think the bioeconomy already has a Christmas present in the bag. However, think again...

Not because anyone fails to understand that, from a societal perspective, the bioeconomy is, first and foremost, a way to abandon an economy based on fossil resources in favour of more sustainable development – or, to put it more elegantly, a transition from a fossil carbon cycle to a biogenic carbon cycle.

If it has been said, written, and repeated so many times, where does the feeling come from that nothing is actually happening? It reminds one of an old Finnish rap song that promises something so sudden that it will “smash a toilet bowl in half.” The bioeconomy, despite the endless flow of strategies and declarations, has yet to “smash any bowls.” The problem is that directives and regulations consistently “run over” everything the bioeconomy has to offer.

Following the announcement of a new bioeconomy strategy, the European Union typically revises the Renewable Energy Directive, which, as a side effect, sets criteria for the sustainable use of wood. The promise that the rules of the game will keep changing almost hangs in the air.

What kind of wood use will be permitted in five years' time? As the Finnish saying goes – not even “Erki” knows (i.e., nobody knows). Moreover, changes could also affect what is perhaps the most beautiful thing in the world – the European Union’s Land Use, Land-Use Change and Forestry (LULUCF) regulation, which governs the accounting of greenhouse gas emissions and removals from land use, including the role of forests as carbon sinks. Its baseline data is inconclusive, yet future targets are specified down to the last decimal point. These overly ambitious targets are a serious problem for the forestry sector. The emissions trading system has also proven to be almost “allergic” to biomass.

Stuck in the gears of the legislative machinery, the bioeconomy based on forest resources risks being ground into sawdust. Turning the European Union's ambitions into reality will require persistent effort. Over the next year, negotiators from Finland and other bioeconomy advocates should prioritise putting pressure on EU decision-makers, demanding how EU legislation could better support this sector.

For example, how could the LULUCF regulation, sustainability criteria, emissions trading rules, the Biotech Act II, and the Public Procurement Act be improved to fully unleash the potential of the bioeconomy?

Explanation of some terms:

Bioeconomy – an economic model in which fossil resources (e.g., oil, coal, natural gas) and materials are replaced by renewable biological resources from land and sea, such as wood, agricultural crops, or algae. In the context of the forest bioeconomy, this means using wood not only for paper or construction but also for advanced textiles, packaging, chemicals, and biofuels.

Biogenic carbon cycle – the natural process in which plants and trees capture carbon from the atmosphere during photosynthesis, store it in their biomass (wood), and subsequently, as the biomaterial decomposes or is burned, it returns to the atmospheric cycle. Unlike fossil carbon, which has been trapped underground for millions of years and causes an irreversible greenhouse effect when released into the atmosphere, the biogenic carbon cycle is theoretically closed and climate-neutral, provided that forests are replanted.

LULUCF regulation (Land Use, Land-Use Change and Forestry) – European Union legislation that determines how member states must account for and manage greenhouse gas emissions and carbon sequestration resulting from managed land – forests, arable land, and grasslands. The author of the article criticises it because the regulation imposes strict targets to maintain or increase the volume of forests as carbon sinks, which in practice may mean restrictions on tree felling and the use of wood in production.

Renewable Energy Directive (RED, Renewable Energy Directive) – the EU legal framework that sets targets for the share of renewable energy. As wood biomass (woodchips and pellets) is a significant energy source in the Nordic countries, this directive sets strict “sustainability criteria” – that is, what kind of wood can be considered a renewable energy resource. The industry is concerned that constantly changing the rules creates instability for investors.

Emissions Trading System (ETS) – an EU market instrument for limiting climate change, in which companies buy and sell greenhouse gas emission allowances. The article mentions that the system is “allergic” to biomass, meaning that current ETS rules do not sufficiently promote or reward the use of biomass and bio-carbon technologies compared to other solutions.

Biotech Act II (Biotech Act II) – an EU legislative initiative aimed at promoting the development and commercialisation of biotechnology – genetically modified or improved organisms, enzymes, and bio-processes – in Europe. In the bioeconomy, this is important for more effectively extracting valuable chemicals and materials from wood with the help of modern science.

Public Procurement Act – state and municipal procurement rules. The author notes that the development of the bioeconomy could be rapidly accelerated if public procurement, for example when building schools or public buildings, set the use of eco-friendly biomaterials, such as timber structures, as a mandatory requirement or advantage over fossil materials like concrete or steel.