Vaasa – The energy capital of the Nordics

Vaasa is one of those cities where a stroll across the market square or a drive down the main road is hard to complete without stumbling upon one or two friends, relatives or acquaintances. Home to almost 70 000 people, the humble face of the city belies an energetic core. In fact, one that has coined the label: the energy capital of the Nordics.

These deep energetic roots can be traced back to the beginning of the 20th century, when local resident John Wickström established what would become an extremely successful boat engine company under his own name. This business fuelled the development of the sector at large, and since then, the ball has been rolling at increased speed.

“Today electrical and automation technology are huge in Vaasa,” says Hanna Alavillamo, communication and brand manager of the energy cluster EnergyVaasa. “The Vaasa region is responsible for almost all of the Finnish development in this sector.”

Along with a cleantech boom that doubled employee numbers in the first decade of this century, the city is also making a name for itself as the perfect location for energy storage production. In fact, according to the GigaVaasa initiative it would be possible to start up large battery factory projects already next summer.

Catching up with digitalisation

Looking at the small population in the Vaasa region, which is only two per cent of Finland’s total, it’s clear that the city hosts some of the most export-minded Finns.

“Today Vaasa expertise is found in the electrical grid in all countries in the world,” EnergyVaasa’s Alavillamo emphasises.

The ongoing success of the EnergyVaasa cluster both locally and abroad is a result of different types of partnerships and joint programmes.

“Within the cluster, the companies can be rivals in some areas but partners in others,” Alavillamo explains.

The synergy includes companies and the school system and is visible in subcontractor deals, product and solution development as well as research. One such cooperation area is the forthcoming digitalisation of the energy sector, where There Corporation is providing smart solutions together with for example Fortum and Vaasan Sähkö.

There Corporation’s scalable cloud-based home energy management platform is already optimising the energy use and costs in thousands of homes. Here home electricity heating or warm water boilers are controlled according to hourly electricity prices, making the homes an active part of the electricity market. However, this is only the beginning.

“The digitalisation of the energy sector is still behind many other industries, but nonetheless it is transforming the use of energy and we are at the forefront of this change,” says Tapio Saarenpää, CEO of There Corporation. “Together with distributed wind and solar power as well as IoT, our platform makes possible many types of consumer services that we cannot even foresee today.”

According to Saarenpää, the future lies in electricity demand management where not only the energy use of individual homes is optimised, but where the company’s technology allows a large number of homes to be aggregated and ultimately to share their electricity with others.

“It is less expensive than building reserve power plants and saves electricity from the perspective of not only individual homes but also from that of the nation,” says Saarenpää. “It is sustainable development were consumers get compensated for sharing electricity – a bit like a virtual power plant.”

Little city big in the World

There Corporation is still establishing itself in Finland, but as is the case for many of the companies in the region, it is only a matter of time before it goes international.

The big players such as Wärtsilä, Danfoss and ABB are responsible for most of the local export but many small companies are subcontractors to the bigger companies and thus the synergy makes them part of the exports.

The international growth of the region’s SMEs is also boosted by, for example, VASEK and Merinova in joint programme areas. One of these programmes is Cleantech Kvarken, where cleantech sector business is promoted in crossborder co-operation with Swedish partners

“VASEK and Merinova have been of huge help in spreading our message and getting to know the right contacts,” emphasises Robert Wentjärvi, the managing director at GeoPipe, a cleanthech company taking part in the programme.

GeoPipe focusses on utilising the heat and cold naturally stored in water, bedrock and sediment with new types of collectors. The innovation lies in a system where more heat or cold can be extracted with fewer costs and less work.

The naturally extracted energy is used to heat up individual buildings, homes, summer cottages or distributed to the heating network. Even though electricity is needed to operate the system, two thirds of the energy come from the natural deposits.

Thus, less eco-friendly oil heating methods can be decreased substantially, including on an international level. The company is currently operating in Finland and Sweden and now the plan is to expand to England where the possibilities and demand for its product is huge.

“More than 15 per cent of the 66 000 gigawatt hours of energy required for heating in London could be extracted from the heat stored in the Thames,” says Wentjärvi.

The centre of innovation

Vaasa’s international reach is also mirrored by global expertise coming to its shores. Dr.Krish Sankaran, a Swiss citizen who recently moved to Vaasa, is building the foundations for a globally significant focal point for the energy sector as the managing director of Vaasa Energy Business Innovation Centre – VEBIC.

“As a someone coming from outside I see a lot of potential in this region which I am not seeing elsewhere in Finland and maybe not even in the Nordic countries,” says Sankaran. “This place has the potential to become the Mecca of energy innovation.”

Sankaran envisions VEBIC to be a place that everyone within the energy business feels the need to visit and collaborate with at least once in a lifetime. To accomplish this the innovation centre is undertaking both applied and radical innovation research in a variety of fields.

The innovation research will challenge the industry to think in new ways across a variety of areas. Here green solutions are high on the agenda and in one of the projects, the aim is to reduce environmental impact by converting atmospheric carbon dioxide into liquid fuels.

“Energy harvesting, energy storage and advanced fuels are a package in three steps – to get the energy, to store the energy and to convert energy,” says Sankaran. “In five years’ time, we might have a prototype or a concrete product.”

Social ideals

Another special focus point for the innovation centre is addressing the wider socioeconomic picture. The aim is to create public-private partnerships to develop an efficient energy infrastructure.

“We are for example looking at how to develop a functional, cost-efficient public transportation system for the city of Vaasa,” says Sankaran.

According to Sankaran, the cooperation between different institutions in the region is a key to accomplish these goals. Here the intention is especially to create more synergy between the industry and education in the shape of internships and open house concepts.

“We need more of those young minds coming in to the game because those are the biggest source of innovation,” says Sankaran.