The Innomost team pose in the forest
 Innomost utilises birch bark to produce compounds that can replace microplastics, palm oil and other environmentally harmful raw materials in sectors such as cosmetics and pharmaceuticals. Image: Innomost

Finnish circular solutions continue to sustain a future approach

Finnish public and private sector entities are taking action to make circular economy a reality.

Aleksi Teivainen

24.11.2022

Pirkanmaa and Uusimaa, the two most populous regions in Finland, have been selected as pilot regions for the EU Circular Cities and Regions Initiative (CCRI).

The initiative establishes a network of 30 cities and regions that look to promote the green transition at local and regional level with the help of tailored support for the development, implementation and improvement of action plans, investment plans and solutions; guidance to improve the monitoring of circular projects; and knowledge sharing on financial and technical support.

The initiative attracted more than 100 applications from cities and regions across Europe.

A woman stands at the top of spiral staircase

Uusimaa’s sheer size from a Finnish perspective makes it a suitable candidate for the initiative. Image: Yiping Feng / Ling Ouyang

“Regionally, we can showcase a high circular potential to develop our circular economy, in terms of sustainable development and business,” stated Ossi Savolainen, regional mayor at the Helsinki-Uusimaa Regional Council.

“We have both the largest population and material flows in the country. Regarding the recycling of waste material, our region has the most dense and optimal social structure.”

Pirkanmaa intends to draw up its own circular economy pilot as part of the initiative, focusing particularly on investment needs, according to the Council of Tampere Region.

“Our objective is to utilise this opportunity to spur investments worth tens of millions of euros, scale existing innovations, trials and demonstrations to the industrial scale,” outlined Roope Lehto, president of the Council of Tampere Region. “We will thereby increase the impact of regional development work with the help of EU funding.”

The CCRI network consists of a total of 12 pilots and 25 fellows, including Jyväskylä and Päijät-Häme in Finland. The fellows will develop preconditions for their circular economies by learning from the network while taking advantage of facilitated knowledge-sharing, first-hand information, community and co-operation opportunities, and increased visibility.

An aerial image of a residential area with wooden houses in autumn.

The City of Tampere has earned recognition for its efforts to keep key materials in circulation. Image: Laura Vanzo / Visit Tampere

In addition, Tampere, the business and population hub of Pirkanmaa, was recently announced as the winner of a national circular economy competition launched by the Finnish Innovation Fund (Sitra), Finnish Environment Institute (Syke) and Association of Finnish Municipalities. Its winning submission was a circularity-focused procurement model for infrastructure construction that was trialled and fine-tuned as part of the renovation of a downtown road.

“The circular-economy criteria and procurement model are ways to increase the re-use and recycling of materials, as well as significantly decrease lorry traffic,” said Karoliina Tuukkanen, project manager at the City of Tampere.

“The model can be freely used also in other cities.”

Four other cities, regions and regional utilities received honourable mentions in the competition. The City of Lahti, for example, was recognised for successfully utilising 99 per cent of the construction waste produced during the renovation of its city hall.

Lahti City Hall

The ongoing renovation of Lahti City Hall was recognised for its circular approach to construction waste. Image: Visit Lahti

Such local and regional efforts are closely interlinked to a national effort to become a leader in circular economy.

The Finnish Government in April 2021 adopted a strategic programme designed to transform the national economy into one that is based on circular solutions by 2035. An integral element of the work to achieve carbon neutrality by the same year, the programme sets forth not only goals and indicators, but also measures and resources required to bring about the systemic change.

It envisions an economy the success of which is founded on carbon-neutral and circular economy society where sustainable products and services are mainstream, the sharing economy is part of everyday life, and natural resources are used sustainably and remain in circulation longer.

Private-sector pledges green

The local, regional and national plans and commitments have encouraged action in the private sector.

Rentle in September announced it has raised 3.8 million euros for its effort to tackle what it believes is a key problem standing in the way of sustainable commerce: the lack of appropriate software for merchants to start, manage and grow circular business models. The Espoo-based startup described the seed funding as a key milestone, saying it enables it to meet growing demand and to expand its team. The news follows a 250 000-euro pre-seed round raised in 2019.

The funding round was backed by a number of prestigious financial service investors, such as Anthemis, Maki.vc, Mission One Capital and Tera Ventures.

Founders of Rentle pose in front of caravan

Rentle founders Toomas Kallioja, Tuomo Laine and Joel Mikkonen pictured in 2019 after announcing their successful seed round. Image: Rentle

“We’re building a first-of-its-kind technology that supports sellers in transitioning to more profitable and sustainable circular business models,” summarised Tuomo Laine, chief executive of Rentle.

“For consumers, this will mean effortless access to a wider range of better-quality goods at a lower price.”

The platform fundamentally enables merchants to sell and rent their products to consumers online and offline. It has attracted interest especially from companies looking to grow their rental business in the face of growing public preference for sharing over ownership, including Motonet and Scandinavian Outdoor.

The latter, for one, is looking to leverage the platform to offer seasoned and amateur hikers and campers with the equipment they need to enjoy the outdoors.

“Any large behavioural shift requires and underlying technology platform to enable it,” highlighted Sophie Winwood, principal at Anthemis. “Not only is this move a necessity as we transition to a more sustainable commerce model, but it also represents an enormous business opportunity, where embedded [financial and insurance] tech revenue streams will play a big role.”

Eamonn Carey, general partner at Tera Ventures, viewed similarly that the Finnish startup is at the confluence of secular trends ranging from circularity and sustainability to the evolving notion of ownership.

Funding circular fertilisers, materials, textiles

A close-up photo of a pile of batteries.

Finnish startup Tracegrow has developed a patented method for producing fertilisers from used alkaline batteries. Image: Hilary Halliwell / Pexels

Tracegrow, a fertiliser producer based in Kärsämäki, North Ostrobothnia, has received an investment from Nordic Foodtech VC.

The startup’s patented process separates micronutrients from used alkaline batteries and industrial side streams to produce fertilisers that have been shown to reduce carbon emissions and improve crop fertility compared to traditional methods.

Mikko Joensuu, chief operating officer of Tracegrow, said the startup is delighted to have received an investment from an investor that specialises in food and food technology innovations.

“Nordic Foodtech VC is bringing insight, knowledge and networks from the food system to our company. Together we see great potential in helping primary production in transition towards more ecological and productive future,” he commented.

Innomost in August reported that it has secured one million euros in funding from Finnish Industry Investment (Tesi) and Metsä Spring, the innovation arm of Metsä Group.

The Kokkola-headquartered startup utilises birch bark, a by-product of the forest industry, to produce compounds that can replace microplastics, palm oil and other environmentally harmful raw materials in sectors such as cosmetics and pharmaceuticals. The funding, it stated, signifies a step toward advancing from pilot to industrial-scale production.

“By using renewable, fully usable raw materials for value processing, we are at the top of production trends in the beauty industry and in other industries,” stated CEO Sami Selkälä

A tree stump bearing Innomost's wood-based solution

Innomost’s solution has the potential to revolutionise market offerings on a global scale especially in the cosmetics industry. Image: Innomost

Innomost began building its pilot production facility after a five million-euro funding round led by Metsä Spring in 2021. Scheduled for completion by the end of 2022, the facility will be able to churn out 20 tonnes of birch bark products, including azelaic acid, betulin, birch-bark powder and birch charcoal powder – all ingredients with potential to yield new product innovations in cosmetics.

Rester announced early last summer it is ready to scale and internationalise its business after closing a funding round worth six million euros. The Helsinki-based startup offer solutions for processing end-of-life textiles into fabrics and technical textiles for the textile industry and into insulation and composite materials for the construction industry.

The funding round was led by one of the leading textile service companies in Europe, Lindström Group, with participation from Besodos Investors, Taaleri Sijoitus and Tesi.

“The textile industry is a major source of greenhouse emissions in the global economy and consumers [sic] vast amounts of water. Still, recycling and re-use of textiles, which would decrease the environment load, is far from optimal,” told Mikael Niemi, investment director at Tesi.

Tesi invested in the startup through its 75 million-euro circular economy programme.

What goes around, comes around

Finland also continues to take an active role in building a circular economy future on a global scale. The World Circular Economy Forum offers a collaborative platform for governments and different kinds of companies and organisations.

Organised since 2017 jointly by Sitra, the Finnish Innovation Fund, along with a host of international partners, each year, the forum also presents innovative circular economy companies from Finland and around the world.

In 2021, the event was held virtually in Canada (see video above). This year’s event is being hosted in Kigali, Rwanda, on 6–8 December.

Originally published in September 2022.

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