As Finland electrifies, the energy system’s hardest question is not an ordinary weekday but a week of freezing weather. According to our Chief Growth Officer Ville Karttunen, the future of gas lies in flexibility, storage and resilience. He also has a wish for the gas sector: a synthetic-gas market will not emerge from giant projects. It will emerge by starting smaller.
Imagine a week in January. The temperature is around minus 20 degrees Celsius, wind turbines are barely turning, and the sun makes only a brief appearance. At the same time, industry is running at full capacity, homes are heated with electricity, and data centres operate around the clock.
In Finland, there is much discussion about how quickly industry, transport and data centres are electrifying. Far less is said about what keeps the system running during a week like the one described above.
Our Chief Growth Officer Ville Karttunen considers this question in his work.
“The value of gas should not be measured on a normal day, but when the system is under greatest strain. Its role is not disappearing; it is changing. Its value becomes clear when the electricity system quickly needs flexibility, backup power or long-term security,” Karttunen says.
Electricity demand could grow by 50% in four years
The figures show why the question matters now rather than in 2040. Fingrid estimates that Finland’s electricity consumption will rise from around 83 TWh today to 103–123 TWh by 2030.
The biggest growth will come from data centres, hydrogen and e-fuel production, and other industry. Data centres accounted for just over two per cent of electricity consumption at the end of last year. By 2030, the Finnish Data Center Association estimates their share will be five to six per cent; according to a Fingrid expert estimate, it could be as high as ten per cent.
Electricity consumption is growing particularly in southern Finland. Production, meanwhile, is concentrated in the north, where wind power is being built. Production and consumption do not coincide geographically or in time.
In response, transmission system operators Gasgrid Finland and Fingrid surveyed 16 potential locations for gas-engine power plants this past spring. Sites in Hyvinkää, Helsinki, Kerava and Mäntsälä scored highest—precisely where consumption is growing fastest.
According to Karttunen, the study points to an essential change: gas is no longer viewed only as a fuel, but as part of the reliability of an electrifying Finland.
“Gas does not compete with renewables; it complements them. The more weather-dependent production and new demand the system has, the more important the ability to balance it quickly becomes.”
Batteries can provide storage for hours; gas for months
Flexibility and storage in the energy system are often discussed as if they were one thing. Karttunen says they encompass many different needs.
Batteries efficiently smooth fluctuations lasting at most a few hours. Thermal storage helps locally. Planned pumped-storage plants can cover a day, perhaps two. But when a windless cold spell stretches into weeks, none of these is enough.
“Batteries are good for flexibility over hours. The strength of gas lies in longer periods: days, weeks and, in the future, storage across entire seasons,” Karttunen says.
The gas system also has a feature that is almost always overlooked in this discussion: gas can be supplied through the network even without electricity.
In an electrifying society, almost everything depends on the electricity system working at any given moment. Gas distribution does not. During a disruption, it offers an alternative route for energy.
“If the electricity system is disrupted, gas can play a very important role. It makes the whole system more resilient.”
The most competitive solution is often a combination of electricity and gas
For business leaders, all this comes down to one observation: the electricity system will become more volatile before it stabilises. Energy decisions have to be made now, in the midst of the transition.
According to Karttunen, too many people frame the choice as either electricity or gas. In industry, the most competitive solution is often a hybrid: an electric boiler when electricity is cheap and available, and a gas boiler to safeguard supply and manage price risk.
“For a company, the point is not to choose electricity or gas on ideological grounds. The point is to find a combination that safeguards competitiveness, security of supply and emission reductions at the same time.”
“A hybrid solution combining electricity and gas can always find the lowest price available in the market and enables a gradual, cost-effective transition to emission-free energy production, because natural gas can be replaced with biogas and electricity in line with industrial customers’ own emissions targets.”
The same logic applies to future energy solutions for transport. A fixed route between two terminals lends itself naturally to electrification. Variable, long-distance operations may be more practical with gas, which offers greater range and flexibility than electricity.
Synthetic gas could turn the gas system into an energy store
Gas is often described as a bridge fuel: an interim step to be dismantled once the destination is reached. Karttunen says this picture is too narrow. The gas system is developing in stages from natural gas to biogas and finally to synthetic gas. In that final stage, its role is transformed.
The idea is simple. When renewable electricity is plentiful and cheap, it can be used to produce hydrogen. Combining hydrogen with carbon dioxide creates synthetic gas, which can be stored in pipelines and large gas storage facilities for months, even from one year to the next.
“The gas system is then no longer just a distribution channel but an energy store. If electricity can be converted into gas and stored, we gain an entirely new way to balance fluctuations in renewable generation,” Karttunen says.
He then says something rarely heard from a representative of the gas industry: the biggest obstacle to the market is not the technology but the industry itself.
“There has been a tendency to build projects that are too large. When creating an entirely new business, the whole value chain has to be built from scratch. It is difficult for customers to commit to large volumes when prices have not yet settled.”
“Carbon dioxide producers face the same problem. At least synthetic methane already has distribution infrastructure, and therefore customers and markets. Pure hydrogen does not even have those. And if project developers have limited balance sheets, their credibility to build major projects worth hundreds of millions is weak.”
Karttunen is equally frank about support policy. If electricity generation is subsidised, we must understand exactly which problem the support is meant to solve. The urgent problem is occasional shortages of capacity, not a lack of inexpensive electrical energy. Poorly calibrated support distorts electricity price formation. Regulation presents another difficult question: aviation’s e-fuel targets are ambitious, but will there be political resolve if airfares rise?
“The market is only beginning to take shape. It needs customers, raw materials, credible investors and projects of a realistic size. Progress is being made, but it will not happen overnight.”
Auris itself follows the same logic. Its Mäntsälä biogas plant was not built to giant scale in one go; production was doubled by expanding it step by step.
Similarly, Auris will begin producing biogenic carbon dioxide at a smaller scale in Mäntsälä before moving to larger volumes at the Säkylä biogas plant.
Starting small is not caution. It is a way to get the market moving at all.
The future of gas lies where it solves a real problem
Debates about the future of gas often use the wrong arguments. Judged by consumption on a normal day, gas looks like a relic of the past. Judged by the system’s hardest week, the picture changes.
“Gas needs to find its place where it solves a real problem. That could be peak capacity, backup power, a hybrid solution for industry or, in the future, the storage of renewable energy,” Karttunen says.
When electricity use rises, the wind is not generating power and industry needs energy, what matters is not which form of energy looks best on paper. What matters is what keeps society running.
A bridge is dismantled once the river has been crossed. An energy store is different. It is needed every winter when frost sets in and the wind dies down.