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Finnish firms champion energy transition

The switch to cleaner energy requires investments not only in production facilities, but also in development of smart grids.

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Finnish energy companies have reported advances with sustainable diesel, ethanol, hydrogen and methane.

The European clean energy transition has been kicked into overdrive following the Russian invasion of Ukraine. The European Commission on 8 March unveiled a draft plan to break dependence on Russian fossil energy by 2030.

“We need to act now to mitigate the impact of rising energy prices, diversify our gas supply for next winter and accelerate the clean energy transition,” stated Ursula von der Leyen, president of the European Commission. “The quicker we switch to renewables and hydrogen, combined with more energy efficiency, the quicker we will be truly independent and master our energy system.”

“Renewables are a cheap, clean and potentially endless source of energy and instead of funding the fossil fuel industry elsewhere, they create jobs here,” added Frans Timmermans, head of the European Green Deal.

The two-pillar plan has the potential to cut demand for Russian gas by two-thirds by the end of 2022, according to the European Commission. The first pillar seeks to diversify gas supplies by means such as expanding the production biomethane and green hydrogen, whereas the second seeks to accelerate the shift away from fossil fuels by spurring electrification, energy efficiency and the use of renewables.

Companies in Finland have launched undertakings that support many of the plan’s goals – some years ago, others more recently. P2X Solutions, Lahti Energia and Nordic Ren-Gas, for example, announced major investments in green hydrogen and methane production in the first quarter of the year.

Investments in hydrogen production

P2X Solutions in March named Sunfire, a green technology company based in Dresden, Germany, as the supplier of electrolysis equipment for its 70 million-euro industrial-scale green hydrogen production and methanation plant in Harjavalta, Western Finland.

Herkko Plit, CEO of P2X Solutions, estimated that choosing a supplier for the electrolysis equipment – the largest single investment decision associated with the facility – is a key step not only for the project, but also for creating a hydrogen market and an emission-free welfare society in Finland.

“To increase energy self-sufficiency and to reduce import dependence, we now need to fast-track green investments,” he underscored.

Upon its scheduled completion in mid-2024, the 20-megawatt plant will utilise renewable energy to electrolyse water into hydrogen and oxygen, and refine some of the hydrogen into renewable synthetic fuels, such as synthetic methane. It will reduce national carbon-dioxide emissions by about 40 000 tons a year, according to P2X Solutions.

The plant is set to become the first of its kind in Finland.

P2X Solutions announced its final investment decision concerning the plant in February. The announcement followed a financing round that saw the company ink financing agreements with several domestic and international partners and investors, including Germany’s Prime Capital. Plit said the German green energy fund has also indicated its interest in providing long-term funding to P2X Solutions.

The Finnish largest hydrogen and P2X-fuel investment will be used for the development of a power-to-gas plant that will be built adjacent to Lahti Energia’s Kymijärvi energy complex. Image: Lahti Energia Oy

“It’s great to have Prime Capital with us,” he stated.

The Helsinki-headquartered green hydrogen specialist has set itself the objective of ramping up its electrolysis capacity to 1 000 megawatts in the next decade. “The design of the subsequent plants has already begun,” Plit said in March.

Lahti Energia and Nordic Ren-Gas in January revealed they have signed an agreement regarding the development of a power-to-gas plant that will produce green hydrogen and renewable methane in Lahti, Southern Finland.

The raw materials required for the process are water, carbon dioxide and renewable energy.

The partners agreed to conduct a study to determine the economic and technical feasibility of the 250 million-euro project before making a final decision on what would be the largest ever investment in a green hydrogen facility in Finland.

The power-to-gas plant is to be built in two stages on a site that houses mixed-fuel power plants operated by Lahti Energia, with the first 20-megawatt electrolyser to be started up in 2025 and the electrolysis capacity ramped up to 120 megawatts by 2030. The plant will be able to produce almost 50 million litre-equivalents of renewable methane for the needs of heavy-duty transport.

“Ren-Gas’s goal is to establish a dispersed production and distribution chain for clean gas fuels for heavy-duty transport in Finland,” outlinedSaara Kujala, CEO of Nordic Ren-Gas.

Lahti Energia will gain access to substantial amounts of excess heat in exchange for providing the plant site and the infrastructural connections required for commodity procurements. The heat captured from the plant, it said, will suffice to produce almost 40 per cent of the district heat consumed in Lahti, a 120 000-resident city located a little over 100 kilometres north of Helsinki.

Jouni Haikarainen, managing director of Lahti Energia, said the project will effectively allow the local utility to convert its district heat operation into a carbon sink. “We will enable greater emissions reductions than our own operations will cause,” he said.

The plant also promises to reduce emissions by capturing about 100 000 tonnes of carbon dioxide annually from flue gases emitted by the adjacent plants.

Neste generates traction for sustainable diesel

Neste is continuing to haul its renewable diesel to new markets. Image: Neste

Neste in March reported that it has signed an agreement for the establishment of a joint venture with Marathon Petroleum, a petroleum refining company headquartered in Ohio, the US. The 50-50 venture will start producing renewable diesel following a conversion project at the refinery of Marathon in Martinez, California.

The Finnish petroleum company said it will contribute around 900 million euros toward the costs of the project, estimating that its renewable products capacity should rise to “slightly over” one million tons once the production starts in the second half of this year.

“We are thrilled to partner with Marathon: we both share an ambition in offering more high-quality, lower-emission renewable products, thus helping customers to achieve their sustainability goals,” commentedPeter Vanacker, CEO of Neste.

The partnership, he told, marks a key step for the renewable products growth strategy of the Finnish company: it not only provides proximity to the growing renewable fuel market in California, but also broadens the company’s value chain, which extends from feedstock sourcing to the production and sales of renewables, in the US.

Together with Neste’s expansion project in Singapore, the venture will result in a 5.5 million-ton increase in the renewables production capacity of Neste by the end of 2023.

“We will be the only global provider of renewable products with a production footprint in North America, Asia and Europe,” highlighted Vanacker.

The Finnish company said earlier this year it has joined forces with DEAC, one of the largest independent data centres in Northern Europe. The goal of the partnership is to enhance the sustainability of data storage during power outages and other similar disruptions by fuelling emergency diesel generators with the sustainable diesel of Neste.

DEAC switched to renewable energy to manage its day-to-day operations in 2021.

“We are pleased that global data centres, the backbone of the digital world, follow more resource-intensive industries in search of solutions for a more sustainable future,” commentedHeidi Peltonen, head of marketing and services for sustainable partnerships at Neste.

New production, forecasting methods

Researchers at LUT University in Lappeenranta, Finland, and the Technical University of Munich (TUM) in Germany announced last month they have developed a new process for producing ethanol, offering an alternative to the traditional method of fermenting sugars in starchy materials such as corn, straw and wood.

The three-step process utilises electricity and lignocellulosic biomass as the main inputs.

The synthetic gas created by gasifying the biomass is first purified, reformed and subjected to methanol synthesis. The methanol is then subjected to acetic acid synthesis together with a carbon-monoxide rich stream separated from the synthesis gas by membranes. Finally, the acetic acid is hydrogenated to produce ethanol.

“The overall process mainly consists of technically mature sub-processes,” saidDaniel Klüh, doctoral student at TUM. “However, the composition of the process steps and the final step – the hydrogenation of acetic acid to produce ethanol – are new.”

The universities said the process has the potential to yield 1 350–1 410 litres of ethanol for every dry ton of biomass, compared to only 200–300 litres with the traditional fermentation-based process. While the process costs will depend markedly on electricity prices, calculations based on their assumptions about energy and raw material prices indicate that the costs will be competitive.

As long as electrolysis is powered by green energy, the universities added, the process can produce a fuel that causes 75 less greenhouse gas emissions than a fossil fuel such as petrol.

VTT Technical Research Centre of Finland believes artificial intelligence will play a key role in anticipating and adjusting to market fluctuations associated with renewable energy. Image: Pixabay / Pexels

The switch to cleaner energy, however, requires investments not only in production facilities, but also in solutions that enable all stakeholders to better understand and anticipate fluctuations in what will assuredly be a significantly more dynamic market.

“With the shift towards carbon-neutral solutions, the generation of power depends on the availability of renewable energy. Since we cannot control this, we must learn how to predict it,” explained Sergio Motta, leader of a research team focusing on smart grids at VTT Technical Research Centre in Finland.

Artificial intelligence and machine learning will be key, he and his colleagues believe.

VTT has created an artificial intelligence-powered software that improves the quality of forecasting for energy sector applications. Called Energy Teller, the software combines data-efficient and adaptive deep-learning methods with physics-based modelling to produce more accurate and reliable forecasts and provide a clearer overview of the conditions and requirements affecting energy generation, distribution and consumption.

VTT Technical Research Centre in Finland has created a tool that harnesses the power of data for accurate forecasting in the energy sector. Image: Workspace

The development work began after the research centre completed a tool for forecasting the capacity of nuclear and combined heat and power plants for Fingrid, the power transmission system operator in Finland. The project was an eye-opener for the potential of artificial intelligence in forecasting, according to VTT.

The tool has since been used to forecast the energy demand of supermarkets and the reactive power compensation requirements of distribution systems.

Bioproducts and power purchase deals

Statkraft, a Norwegian state-owned hydropower company, announced last month it has opened an office in Espoo, Finland.

The office will work with industrial companies and wind power developers, investors and operators, focusing on origination activities and providing upstream and downstream wind power purchase agreements. It will ground and reinforce the company’s long-standing presence in Finland.

“It is time for our Finnish customers to have a locally available partner,” said Frederik Åkerlund, the industry veteran appointed to helm the office.

“As a power purchase agreement provider and trader, Statkraft finds energy solutions for power generators and industrial companies. Our position enables us to offer competitive and innovative services related to power sales and procurement to all participants in the market.”

The Norwegian company reported at the end of the month that it has put pen to paper on a 10-year purchase agreement with Germany’s ABO Wind regarding Pajuperänkangas, a wind farm project under development in Haapajärvi, North Ostrobothnia. With a combined capacity of 86.8 megawatts, the farm’s 14 turbines will generate electricity for roughly 14 000 households once connected to the grid in the latter half of 2023.

Statkraft in 2021 closed power purchase agreements with Kemira, Keva and Neste.

Metsä Fibre and Veolia, a French transnational company engaged in energy services, reported that they have entered into a long-term agreement to produce biomethanol from the crude methanol created in pulp production at Metsä Fibre’s mill in Äänekoski, Central Finland.

Veolia will invest in building a refinery adjacent to the Äänekoski mill and integrating it closely into the mill processes. Image: Metsä Fibre

Kaija Pehu-Lehtonen, head of business development at Metsä Fibre, viewed that the partnership illustrates the Finnish forest industry giant’s approach to bioproducts: upgrading various production side streams to products with the highest possible added value in co-operation with a network of partners.

“Veolia’s project is a concrete example of how our bioproduct concept can be expanded with a new product in co-operation with partners,” she told.

Prysmian Group, an Italian manufacturer of power and signals transmission cables, in March said it is investing over 100 million euros in its offshore wind farm cabling-focused operation in Siuntio, Southern Finland.

By: Aleksi Teivainen