“It’s great to have a landlord who invests in climate-positive solutions” – Financial sector’s concrete actions in the green transition

Varma’s tenants Martin and Paula Mitikka appreciate their landlord’s decision to invest in climate-positive energy renovations. Photo: Teppo Kuittinen
  • Pension insurance provider and major investor in rental properties Varma has made large investments into reducing the carbon emissions of its residential and office buildings.
  • This article is part of an article series showcasing Finance Finland member organisations’ concrete actions to promote the green transition.

Martin and Paula Mitikka are currently living their first winter in their new apartment in Helsinki’s Pajamäki, in a block of flats owned by the pension company Varma. This is also the first winter when the building is heated without district heating.

In 2023, the building was fitted with a geothermal heating system, which runs on renewable hydroelectricity and wind power. Varma also had solar panels installed on the roof, as well as new cables in the parking area to enable the charging of electric cars.

“I appreciate the fact that our landlord and housing company invest in climate-positive measures, and that they see these investments as worthwhile instead of only focusing on profits”, Martin Mitikka says.

Paula Mitikka agrees.

“Hopefully the savings achieved by the energy renovations reduce the pressure to make substantial rent increases in the future”, she says.

After the renovation was completed, getting the room temperature right in the Mitikka residence required a few additional visits from electricians.

“But now we’re just toasty”, the couple smile.

Aiming for carbon-neutral heating

Pension insurance provider and major investor in rental properties Varma has made large investments into reducing the carbon emissions of its residential and office buildings. As a result, their in-use CO2 emissions have decreased by more than half since 2015. Varma’s goal is to achieve full carbon neutrality in its buildings’ heating by 2030.

Varma’s rental properties already include 1,300 energy renovated apartments, of which 840 are heated with geothermal energy. According to Varma’s Asset Manager Riina Komulainen, the Pajamäki building alone attains an annual emission reduction of 59 tonnes of carbon dioxide.

“Although this is the first heating season that we’re using geothermal energy in this building, we can reliably base our estimate on previous experience from similar cases.”

Varma owns about 4,500 rental apartments across Finland. Last summer, the renting and building management of these homes was outsourced to Colliers, a global real estate services company with 19,000 employees.

Like Varma, Colliers is committed to responsibility, with many of its employees in Finland specialising in ESG matters. One of them is Roosa Jaakkola.

“We’re always involved in the process when, for example, the heating of a building is switched from the district network to geothermal heat, like here in Pajamäki”, Jaakkola says.

“Our ESG team lends its support and expertise to energy renovation projects. We also make sure that the monitoring of energy use continues uninterrupted.”

Jaakkola emphasises that the promotion of responsibility does not rest solely on the team’s shoulders: the team works in collaboration with various specialists and operators to find the best solutions for each project.

Colliers’s Building Technology Specialist Tero Ritari gave a tour of the Pajamäki building’s heat distribution room, showing from the touch screen readings on the efficiency of the building’s geothermal heating system during the cold winter months.

“Geothermal energy can provide about 70 per cent of the heating capacity that the coldest temperatures at this latitude require. The rest is covered with electricity”, Ritari explains.

“But periods of extremely cold weather are so few and far between that on an annual basis, geothermal heat covers 98 per cent of the building’s heating capacity.”

Energy efficiency also benefits the residents

Varma’s Komulainen says that like the Mitikkas, their other tenants have also been happy with the energy renovations.

In 2023, most of the respondents to a large-scale survey conducted by Varma said that emission-free energy could influence their renting decision in a positive way.

Energy renovations allow tenants to enjoy cosy living in good conscience. In Pajamäki, the renovations also included the comprehensive maintenance of the building’s hot water radiator system. The radiators were fitted with new thermostats and valves, and the entire system was flushed and balanced.

“A balanced system ensures steady room temperatures and saves energy”, says Tero Ritari.

This year, Varma is planning to launch two new geothermal heat projects in residential buildings.

“As a pension insurer and owner of rental properties, it’s very important that we consider sustainability in our operations. By investing in geothermal heating, we account for the environmental aspects of sustainability, but energy renovations are also financially profitable in the long term. This benefits everyone”, says Varma’s Riina Komulainen.

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Pirita Ruokonen

Head of Public Affairs and Responsibility