Is CCU a silver bullet for Finland

Climate Goals, Competitiveness, and Employment

According to a recent VTT report, Finland's industry has a significant business opportunity in products made from carbon dioxide. By utilizing CO2, it is possible to produce fuels, plastics, chemicals, and building materials that can replace products made from fossil raw materials.

Finland's market potential could reach up to seven billion euros annually by 2040, while the global market is estimated to be between 1,000 and 3,400 billion dollars per year by 2050. Carbon capture and utilization (CCU) will also help Finland achieve its climate goals. The renewal of the industry will create new, permanent jobs in Finland. It is essential that we maintain and even increase industrial activity in the country.

Choosing Wisely

The discussion around carbon dioxide has long focused on capture and long-term storage solutions, such as decommissioned oil and gas fields, which are not suitable for Finland’s geology.

Finland’s path should focus on creating new opportunities and strengthening the energy circular economy. We need to concentrate on utilizing CO2 for value-added products and the renewal of industry, thereby enhancing our future competitiveness. Renewal means not only revitalizing domestic industries but also developing and selling new technologies, solutions, and business models to global entities.

We must act in these networks now. World-class value chains are often established at the pilot stage, even if scaling occurs later. We need to be involved in the networks of pioneering companies where new norms are set.

Carbon capture and processing are part of a comprehensive solution, and success requires innovation, the development of a hydrogen economy, investments, skilled personnel, and the creation of market demand. Partial optimization does not work; all these elements must be advanced simultaneously.

Value-added products and new industries are also of interest to others. We are not alone; others have expertise and resources as well. For example, India’s “National Green Hydrogen Mission” aims to make the country a global hub for green hydrogen and its derivatives, targeting familiar sectors such as transportation, shipping, steel, and chemicals. Investments in India are also in their own billion-range.

From Technological Innovation to Business Innovation

In times of transformation, we must challenge not only our thinking but also our ways of working. Finland’s current economic situation is quite difficult, and productivity growth is not inspiring. However, significant commitments and additional investments in innovation are positive signs.

Historically, R&D investments have not successfully generated the desired productivity growth. From my experience, the main bottlenecks are: 1) innovations are not primarily driven by global future demand, 2) we focus on technology rather than the creation of new business models, and 3) we want to do everything ourselves.

For CCU, global demand exists and will grow. The question now is whether we will invest in identifying potential customers and partners to establish our future market position. Recently, I had a discussion with Vinnova and was inspired by their approach. Vinnova does not focus on technological innovations but on business innovations. In other words, business models and revenue mechanisms must be developed hand-in-hand with technology development. This thinking also facilitates the integration of technologies and solutions from other countries into successful business models.

Focusing on the Development of European Markets

Europe is our domestic market. The Finnish market is far too small to achieve profitability for CCU products. The demand for products made from carbon dioxide is expected to grow in the EU and will significantly advance the EU's climate neutrality goals.

CCU is one of the key solutions in EU climate policy, but the regulation has so far mainly focused on transport fuels. Without sufficient demand and a viable business model, investments in CCU will not be sustainable. It is crucial to generate adequate commercial demand in the EU domestic market. Furthermore, we need to ensure that EU guidelines and our research investments are compatible.

Increasing Finland’s Carbon Handprint Worldwide

CCU presents a significant opportunity, but it is not a silver bullet. There is likely no single miraculous solution to the energy transition. Finland has a strong capability to implement systemic themes and transformations, and this capacity is needed to maximize the benefits of CCU. I see CCU as a foundational element of future new industries.

I want to highlight the following critical factors and perspectives that must be advanced simultaneously:

1. Recognizing CCU as a key component in the radical renewal of Finnish industry

2. Focusing attention on business innovations and international collaboration

3. Viewing Europe as a domestic market and actively developing it

Now is a critical moment to invest in innovations, develop international networks, and direct our focus toward European markets. I invite you to join the discussion on how we can leverage the potential of CCU to strengthen Finland's competitiveness and expand our carbon handprint!

Helena Sarén
Head of Zero Carbon Future Mission

Business Finland
Business Finland is the Finnish government organization for innovation funding and trade, travel, and investment promotion. www.businessfinland.fi/en

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Helena Sarén is the Head of Zero Carbon Future mission at Business Finland. For several years, she acted as a Board member at the Nordic Energy Research. Now, she is a member of the Working Group for Climate and Responsibility at Finland’s Service Sector Employers Association. Prior present position she was heading the national Smart Energy Finland program.

She has over 25 years of comprehensive experience in international business, internationalization consulting, development financing and investments. She holds MSc in Engineering from the Helsinki University of Technology. She has also carried out studies at the Helsinki School of Economics and Business Administration.