27-year-old Eelis Lähdemäki (M.Sc.) had clear career goals starting from a young age. Practical training at Porvoo oil refinery in secondary school gave him a real spark to study mathematics and chemistry, subjects in which he was already talented. After high school, Eelis continued his studies at Aalto University, earning a bachelor’s degree in chemical and process engineering. In the master’s phase, his studies shifted towards renewable energy technology.

“After my bachelor studies, I was looking for different challenges, and Aalto University had introduced a new major that focused specifically on the hydrogen economy and Power-to-X technologies. During my studies, the hydrogen boom started gaining momentum, and I saw this as an extremely interesting future opportunity, so I switched to studying energy technology in the master’s program,” he explains.

From Thesis Worker to Expert

Eelis found his way to Fimpec largely through his own initiative and skills. He wanted to work on a thesis that dealt with topics around carbon capture and Power-to-X technologies.

“A classmate told me about an interesting expert company called Fimpec. I approached the company with an open application, explaining my background and experience. I quickly received a response that there was an open position for a thesis worker in a top-notch international team,” Eelis says.

For his thesis at Fimpec, he chose the topic of process simulation and techno-economic assessment of carbon capture from biogenic sources. Eelis worked on his thesis in early 2023 and graduated later that year in July.

“I feel that my thesis is a very successful body of work. The framework was clear from the beginning, the schedule was well-maintained, and I learned a lot about the technology itself while working on it,” Eelis mentions.

He also appreciates that he was given a lot of responsibility from the beginning, and his self-management skills were trusted.

“The international work environment turned out to be really inspiring, and I feel that my working and team skills have developed tremendously,” he adds.

After graduating, Eelis has been working at Fimpec on customer projects related to hydrogen and renewable energy technologies, taking on various responsibilities as a project engineer. Expertise has been accumulated through practical experience.

“I have had the opportunity to engage in project management with the support of more experienced colleagues, which has been really motivating. I have always learned best by practice rather than just by reading theory,” Eelis praises.

Podcast Appearance with the Minister

The richness of Eelis’s role is evident in the fact that he was invited as an expert guest on Fimpec’s Kumppanit-podcast episode, where topics related to carbon capture were discussed, and visions of a carbon-neutral Finland were explored. In the same episode, the Minister of Climate and the Environment, Kai Mykkänen, also appeared as a guest. The episode featured an interesting and insightful discussion in Finnish on the potential of carbon capture as an industrial emission reduction measure.

“It was fantastic to discuss my area of expertise in such a prestigious company, even though it was a bit nerve-racking at first. A great experience, indeed, I can recommend it!” Eelis says with laughter.

“I guess that not every company offers such a big opportunity to a recent graduate, even if they have the knowledge and skills. I think it says a lot about the company’s trust and investment in its employees,” he continues.

Exploring New Frontiers Every Day

In addition to diversity, Eelis is motivated by innovation, supportive colleagues, and the opportunity to constantly learn new things in his work. The energy transition and green shift bring Eelis into the realm of significant issues every day, providing a whole new meaning to his work. According to him, the world increasingly needs green energy solutions to slow down climate change and reduce emissions.

“For me, it’s important that at Fimpec, I get to be involved in projects that contribute to the development of clean energy solutions. The industry is constantly evolving, and it’s great to be part of this right from the beginning and see what opportunities the future holds,” Eelis adds.

Balancing work, Eelis enjoys daily informal conversations with colleagues. While the work team has daily meetings, casual discussions continue in the group chat about leisure activities.

“I appreciate a great working environment, and I feel that we genuinely have that at Fimpec,” Eelis praises.

In his free time, Eelis engages in a variety of sports. Going to the gym, running, playing ball games, and skiing in the winter help refresh the expert’s mind in the best possible way.

“In every day, there has to be something just for yourself! Fortunately, in today’s working world, leisure activities, and relaxation are also considered important. The solutions and innovation that come from the brainstorming process must be given room to develop,” he concludes.

In particular, the trust of customers in the industrial and energy sectors has expanded us into a company of over 430 experts, poised to achieve a turnover of 50 million euros this year. Thank you for the trust and skilled collaboration!

The external world has shown its gloominess as interest rates slowed investment decisions, inflation eroded margins, and general uncertainty gnawed at minds. At the same time, our order backlog and quotations are at record levels. There are grounds to face the future with confidence. Together with our partners, we will support our customers in the coming year to execute demanding projects safely, profitably, and exceeding expectations.

Throughout the year, we have demonstrated the competitiveness of our project management services in new industries. The quality of our engineering services has proven to be high. Our consulting services address questions of the energy transition as the hydrogen economy unfolds gradually. Our expanding operations in Sweden, Estonia, and South America create new growth opportunities.

Fimpec has sharpened its strategy. We grow especially as an enabler of clean transition projects driven by technological development, being locally present for our customers. We see opportunities in the energy sector changes, the hydrogen economy, the evolving bioindustries, as well as in the fields of minerals and critical minerals. People tend to overestimate changes in the short term but underestimate their impacts over a longer period.

The work continues, but now is the time to enjoy some rest.

Wishing you Happy Holidays and a joyful New Year 2024!

Jukka Nieminen
CEO, Chief Executive Officer, Fimpec Group

This summary highlights key points from the 8th episode of the “Kumppanit” podcast, focusing on the transition of district heating towards carbon negativity. The podcast, hosted by Maiju Hirvikallio, Fimpec’s Director of Communications & Marketing, is available for listening in Finnish on Spotify.

Tampereen Energia, an energy group employing nearly 400 people, has been making significant strides towards carbon neutrality since the early 2010s. By 2022, approximately 53% of the energy produced by the conglomerate was renewable, and this figure is expected to rise to around 75% in 2023. However, the ultimate goal is set for 2030 when all energy sold by Tampereen Energia will be carbon-neutral, and by 2040, it aims to achieve carbon negativity.

Jukka Joronen, Director of Energy Markets at Tampereen Energia, explains that the transition is based on a comprehensive study of moving towards non-combustible and carbon-negative district heating, progressing through three phases: low emissions, carbon neutrality, and finally, carbon negativity.

“We have largely achieved low emissions by minimizing the use of peat, natural gas, and oil. Investments in waste incineration and wood chip heating plants have quickly eliminated major emission sources. Additionally, we have started utilizing waste heat,” says Joronen.

Currently, the foundation of district heating is established using renewable fuels. The next step involves finding even more environmentally friendly alternatives, including the integration of electric boilers and heat storage.

“Electric boilers act as excellent peak load plants. When it’s windy, especially in freezing temperatures, these boilers help eliminate the need for fuels used in peak load production. Combining electric boilers with an industrial-scale district heating accumulator creates a biomass-wind power-based heating system, which is undoubtedly one of the most environmentally friendly concepts. In the future, the amount of electricity in district heating production will increase further, reducing the need for biomass and focusing primarily on replacing fossil fuels in heat production,” he assesses.

The final step towards achieving carbon negativity requires another innovative solution – the capture of biogenic carbon dioxide. When carbon dioxide is captured from a biomass-fired power plant and permanently stored or utilized, such as in green cement or synthetic fuel production, the city’s heating system becomes a substantial carbon capture system.

“We have dared to present this option boldly in our visions because scenarios for achieving climate goals require the capture of carbon dioxide from the atmosphere. If capture is necessary, the operating environment will eventually reach a level that allows investments, as the necessary technologies are already available. Finland’s conditions, thanks to the forest industry and district heating, make biogenic carbon dioxide capture sensible here,” predicts Joronen.

District Heating: an advantage in striving for carbon neutrality

Tampereen Energia’s path towards carbon negativity relies on leveraging the district heating system. Joronen emphasizes in the discussion that the prevalence of district heating in Finland is a significant advantage when aiming to reduce emissions. It provides an opportunity for carbon negativity, as well as economies of scale in heat and energy storage and maintenance. Above all, it offers the chance to utilize various heat sources.

“In the district heating system, we have a solid foundation to integrate new technology. When thermal energy is transferred through water, it’s much easier to switch fuels, for example, from natural gas to waste heat or biomass, compared to Europe where each house has a gas pipeline that is challenging to feed anything else into. This gives us the opportunity to make significant centralized changes and is therefore a quick route to climate-friendly heating,” he says.

Timing is key challenge

Tampere has made significant progress towards a carbon-free future, but challenges remain, with Joronen identifying the right timing and project complexity as crucial issues.

“One should not move too early or too late. Moving too early can lead to losses, but on the other hand, if you wait and wait, someone else will eventually make the investments. Another challenge, especially in projects related to the hydrogen economy, is their complexity. Their development requires a good team and good cooperation,” he notes.

Joronen doesn’t see technology as a major problem but emphasizes the need for the right mindset when making decisions about solutions.

“We have tried to plan our strategies so that we do not rely on overly speculative technologies but rather focus on those that already exist. However, there are risks associated with their scalability,” he explains.

Creating an environment where companies are willing to invest is still a significant challenge. In this regard, EU regulations play a crucial role. From the perspective of the energy company, Joronen’s wish list includes matters related to E-number calculations and the recognition of district heating.

“The EU aims to increase district heating, at least in discussions, but not all regulations support this. Environmental-positive actions in centralized heating solutions are not recognized. From a regulatory perspective, it’s better to disconnect from the district heating network and make changes to the building itself. I hope there is an understanding of the strength of the district heating system, especially in such a cold country, as it is the fastest way to achieve climate-friendly heating. Another question is the regulation of negative emissions, which is now being planned. It should be high-quality and project-enabling. Overall, clarity, long-term thinking, and predictability are needed in terms of regulation.”

Can green hydrogen production become a new CHP?

Sami Nissinen, the Head of Operations for Energy Services at Fimpec, raised the question in the discussion of whether an energy company’s business could expand into carbon negativity beyond heating and electricity. This brings up the possibilities offered by the hydrogen economy. Joronen sees a parallel in Finland to the previously prevalent combined heat and power (CHP) production.

“In hydrogen production, a lot of heat is generated. It may be that while electricity and heat were previously produced in CHP plants, in the future, more hydrogen production plants will be designed to produce hydrogen and heat very efficiently. Initial steps toward this development are visible,” he concludes.

» “Kumppanit” podcast page (in Finnish)

During Anders Hallgren’s tenure as Manging Director, Fimpec AB has strengthened its position in the Swedish market and laid a solid foundation for future growth. Under his leadership, Fimpec has successfully increased local recognition in the market and established crucial strategic client relationships. Fimpec AB has also expanded its office network in the country.

Fimpec AB will continue its operations under the leadership of Frans Jokinen, Fimpec’s Development Director. Frans Jokinen has previously supported Fimpec AB’s growth strategy in his role as Chairman of the Board.

“We thank Anders for his excellent work and for laying a strong foundation for Fimpec in the Swedish energy and industrial markets. Now, we turn our focus to implementing the strategy and continuing the customer-centric development of our services together with our skilled and professional team in Sweden,” says Jokinen.

Fimpec wishes Anders Hallgren success in his future endeavors!

For more information:

Frans Jokinen, Chairman of the Board, Fimpec AB
phone: +358 45 359 4828, email: frans.jokinen@fimpec.com

This is a summary of the 7th episode of Fimpec’s “Kumppanit” podcast which discussed the opportunities of carbon dioxide capture. “Kumppanit” podcast is hosted by Maiju Hirvikallio, Fimpec’s Director of Communications & Marketing. The podcast is available for listening in Finnish on Spotify.

The capture of biogenic, or biomass-derived, carbon dioxide resulting from the combustion or decay of wood offers Finland a unique opportunity to reduce carbon dioxide emissions and create new business opportunities. Minister of Climate and the Environment Kai Mykkänen emphasizes the importance and uniqueness of this opportunity due to the extensive use of wood in the forestry industry and bioenergy plants in Finland.

“It offers us a fantastic opportunity to become a country that absorbs more carbon dioxide than it releases into the atmosphere. There is significant potential to reduce emissions and, for example, combine captured carbon dioxide with clean electricity to produce various products, such as synthetic cement, different building materials, and even synthetic fuels,” he states.

Biogenic carbon dioxide is particularly valuable because during growth trees absorb carbon dioxide from the atmosphere. When wood is burned, carbon dioxide is released into the air. If captured and stored, it creates a so-called negative emission or a technical carbon sink. Capturing fossil carbon, on the other hand, only reduces emissions without creating negative emissions.

Carbon dioxide capture is a crucial complementary element in reducing climate emissions

The government’s plans emphasize the role of capturing biogenic carbon dioxide in achieving climate goals. Mykkänen states that the government is committed to ensuring that Finland moves towards the goal of being carbon-neutral by the mid-2030s through sensible means.

“We are on a good path to reducing emissions in industry, housing, transportation, and agriculture. By the end of this decade, emissions will be about 60 percent less than in the early 2000s, and emissions will decrease even faster than expected as industry and energy production move away from combustion.”

“At the same time, we face challenges because new calculations constantly undermine estimates of our forests’ and soil’s carbon sinks. We cannot assume that we will significantly restrict the economic use of wood, as it would be very difficult for assets, employment, and the balanced development of Finland,” he explains.

In this equation, carbon dioxide capture is a crucial complementary element, especially on an industrial and energy production scale.

“The government’s most radical climate policy is that it will introduce measures to ensure that carbon dioxide emissions from major industrial and energy production point sources end by the mid-2030s. This practically means finding ways to plug chimneys in large facilities over the next 12 years,” Mykkänen outlines.

The targets specifically focus on the capture of biogenic carbon dioxide. According to Mykkänen, this emphasis is somewhat self-evident due to the trend in Finland where the use of fossil fuels in electricity and heat production, as well as in industrial processes, is rapidly diminishing over the next decade.

“Our electricity production is already about 95 percent fossil-free, district heating production is increasingly moving away from fossil fuels, and industry is aiming to move away from fossil use. So, in the next decade, we won’t use a lot of fossil fuels, but there will be significant by-product combustion in the forest industry and bioenergy production. This can be captured and utilized, thus counted as negative emissions.”

Government measures provide a boost to development

Mykkänen states that the government is prepared to assist in initiating what is considered a crucial development. However, in the long term, it should be market-driven.

“We reduce on almost everything, but carbon dioxide capture is one of the few things we invest in. We have set aside assets to launch an auction for negative emissions or a similar cost-effective mechanism to support the first projects. These can also be financed through the EU’s recovery package, REPowerEU, and large demonstration project investment grants for new energy technologies.”

“At the same time, I emphasize that this does not mean the state is buying negative emissions. Instead, there must be a market incentive to support development. This way, product value is created for biogenic emissions by replacing the reduction of emission rights or the high emission costs of the burden-sharing sector.”

He adds that carbon dioxide capture could become a merit of social acceptability, especially for the forest industry and bioenergy power plants.

“The forest industry, often seen as a player that reduces carbon sinks too much, could be the sector that says we can turn the Nordic balance sheet carbon-negative by capturing carbon dioxide that would otherwise decay and return to the atmosphere and then circulate in the forest. This will also become a competitiveness issue.”

According to Mykkänen, another aspect is that solutions arising from carbon dioxide capture can be technologically replicated in countries where capturing fossil carbon dioxide is challenging. This opens up vast markets in China and India for the foreseeable future.

Research, product development, and regulation

Mykkänen further notes that achieving the goals of carbon dioxide capture requires the technology to become cheaper and applications to be productized. Regulation also plays a role in development.

“It can be significant if, for example, the revised building law gradually introduces a decreasing limit for the life cycle carbon footprint of a building. Then there will be demand for building materials based on recycled carbon dioxide. The same works on the fuel side. On the one hand, if it is clear that it would be socially sensible and reasonably affordable to capture carbon dioxide extensively in facilities of a certain size, we need to consider whether we need regulation to encourage this with sufficiently long transition periods,” he assesses.

Fimpec’s Eelis Lähdemäki points out that in this context, the regulation should be sufficiently straightforward for operators. Mykkänen agrees with the statement.

“Regulation must be straightforward. At the same time, I hope it is as technologically neutral as possible. We should avoid highlighting trivialities and the mistakes made, for example, in the regulation of hydrogen.”

Mykkänen continues that development is also facilitated by investing in research and product development. He reminds that in 2024, the government will allocate about 300 million euros more than in 2023 for this purpose, and by the end of the electoral term, the total sum will increase by over a billion euros.

“When the starting point is that companies allocate two euros for every euro invested by society, we are talking about an annual additional flow of three billion euros for product development and research. This should lead to innovations, and probably will. A bigger challenge is how we can ensure that Finland has good conditions for the commercialization phase and pilot projects in a suitable way at this point.”

Now is the time for bold solutions

In conclusion, Mykkänen states that what is needed now is decisive and appropriate courage, not despair.

“It’s easy for me to find five reasons why things could go wrong. Risks must be recognized and taken into account, but if we want to build the building blocks of the future, we usually have to take bold steps.”

“Many messages come from various quarters that not enough is being done to slow down climate change. I share the concern about climate change and biodiversity loss, but the despair that we are heading towards a dead end is, in my opinion, disproportionate. We have challenges, and it would be better if things were done faster rather than slower, because it is expensive to fix things afterwards. But I believe that humanity is resourceful and that this course will turn around.”

» “Kumppanit” podcast page (in Finnish)

This is a summary of the sixth episode of Fimpec’s “Kumppanit” podcast which discussed the possibilities of wind power and its by-products. “Kumppanit” podcast is hosted by Maiju Hirvikallio, Fimpec’s Director of Communications & Marketing. The podcast is available for listening in Finnish on Spotify.

“I see, think, and dream that Finland becomes an energy powerhouse, a massive producer of clean energy, while simultaneously creating a circular economy through our expertise, where (energy) raw materials are refined into products, such as hydrogen. I want to awaken this idea because it’s futile to resist the green transition train. It moves, it progresses, and we can give it more momentum with concrete actions. And here in Finland, we have excellent conditions to join it thanks to our northern location,” Tuomas Candelin-Palmqvist summarizes.

“It’s essential to emphasize the significance of the entire value chain so that we can maximize the benefits of the opportunities available. Finland should not only focus on producing energy but also on turning it into hydrogen and further into X-products. The significant potential lies in establishing a genuine Power-to-X economy in Finland. Now we just need courage, innovation, collaborative development, cooperation, and as many refinements as possible,” adds Jussi-Pekka Kuivala.

Finland has all the prerequisites for leveraging the green transition

Candelin-Palmqvist and Kuivala don’t limit themselves to simply envision promising future scenarios. They highlight several reasons why Finland has excellent opportunities to benefit from the green revolution if we seize them.

“From the perspective of wind power, our northern location is excellent. The Earth’s tilt generates temperature variations in northern regions, which, in turn, create pressure differences. According to the laws of physics, these tend to balance, resulting in air currents or wind. This doesn’t happen everywhere, so the conditions here are exceptionally good,” Candelin-Palmqvist explains.

Finland’s strength also lies in its large land area compared to the population, providing ample space for wind power. According to Candelin-Palmqvist, Finland also possesses the expertise needed to develop applications for green energy.

“Thanks to our education system and high-level competence, our opportunities are immensely significant from the perspective of refining this (energy) raw material. Hydrogen is one example.”

Bold and broad thinking is needed

Kuivala brings up a study from LUT University indicating that Finland could build much more wind power than it currently has. At the very least, wind power production could be tripled, and the most ambitious estimates of the potential are even over 1,000 TWh per year. Candelin-Palmqvist says that these possibilities are worth discussing.

“We shouldn’t hinder ourselves as a society by thinking too small. Let’s think boldly and broadly instead. Wind power is just one part of the palette of clean energy, but bold and even theoretical assessments of its possibilities are important from the perspective of refinement. For example, producing green hydrogen requires a tremendous amount of clean energy.”

“In a nutshell, we often think that luck or opportunity is elsewhere, not here. Shouldn’t we be bold now and use our opportunities and believe that happiness is right here?” he asks.

Candelin-Palmqvist also reminds that due to the green transition, Finland now has the opportunity to enter the energy business, which was not possible before. The significance of this opportunity is highlighted by the fact that it is the world’s largest business, which is not necessarily understood here.

“In the energy business, we’re talking about billions right away. It’s a completely different scale than Finland is used to. It’s a matter of attitude—do we want to get into such a business that can practically produce significant societal benefits?”

Wind power and the hydrogen economy go hand in hand

Candelin-Palmqvist states that wind power and hydrogen economy go hand in hand, one doesn’t exist without the other.

“Producing hydrogen requires a tremendous amount of energy. So, hydrogen doesn’t happen without a lot of energy. There must be a lot of raw material to refine it into a product,” he explains.

Investments related to the hydrogen economy haven’t widely started in Finland yet. According to Candelin-Palmqvist, there are unresolved issues, particularly in regulations, causing uncertainties from an investment perspective. However, he sees the biggest challenge as one of attitude.

“We need to understand in Finland that we can truly be the best in the world. We shouldn’t humble ourselves too much, so that we don’t miss out on luck. This opportunity is so enormous.”

Kuivala emphasizes the importance of the overall picture. He estimates that so far, wind power and the hydrogen economy have been developed separately. Now, collaborative development is needed. Candelin-Palmqvist agrees, noting a significant change in this regard.

“Previously, green transition projects were considered individual investments. Now we want to think about these things together, and the same investors are increasingly involved in both production and consumption and usage projects precisely because coordination is easier at that stage.”

Candelin-Palmqvist is not worried about Finland’s attractiveness as an investment destination. Simplifying it, he says money goes where it can be put to the best use. This means offering reliability, credibility, an appropriate risk level, and profitable investments.

“From this perspective, I’m not afraid that money won’t find Finland. The most important thing for us to consider is what we want. Do we want to be part of such energy economy? To get there, we have to boldly join in. If we start hesitating about whether Finland is the place where clean energy should be produced and refined, hesitation may lead to money going elsewhere. We need the courage to think that, yes, this is the place.”

» “Kumppanit” podcast page (in Finnish)

I had the opportunity to hold a lecture to third and fourth-year engineering students at Jyväskylä University of Applied Sciences (JAMK) on the processes of heat pumps using different refrigerants and cold processes. The topic was explored through practical examples, examining various heat pump solutions in industrial cooling and district heat production.

The technology of heat pumps is process-oriented cold technology, and training in cold technology is still relatively limited in Finland. Guest lectures at universities are therefore crucial to provide students with the opportunity to delve deeper into the field and understand its significance and realities.

My lecture was based on practical examples, covering different refrigerants’ log p, h diagrams, and various processes such as cascade, carbon dioxide, and ammonia pump cycles, as well as basic refrigeration processes. As part of the lecture, we also discussed the current F-gas regulation for refrigerants and future prospects in this regard.

The F-gas regulation will bring changes to the refrigerant situation in the future, favoring natural refrigerants and hydrocarbons. I recently wrote an article on maximizing the profitability of heat pump investments, delving deeper into the topic. The guest lecture allowed the sharing of knowledge with students and provided an overview of the future of the industry, as we are currently in a transformative phase regarding refrigerants and energy recycling.

The lecture proceeded smoothly, despite the challenging nature of the topic for students and the occasionally technical terminology. Nevertheless, the experience was highly rewarding, and student feedback was positive. According to the feedback, the lecture’s most meaningful aspects were the concrete examples, which also mentioned the realities of the industry in relation to the future prospects of refrigerants.

Guest lectures are valuable for the future of the energy and industrial sectors, promoting awareness of the field among students. I believe that advancing collaboration with higher education is important to actively participate in students’ career choices and contribute to the development of cold technology education in Finland. Guest lectures offer a unique opportunity to share practical experiences and knowledge about the industry while inspiring future engineers and experts.

For more information:

Mika Siekkinen, Manager, Energy Recycling Solutions
Fimpec, Energy Expert Services
tel. 040 416 6610, mika.siekkinen(at)fimpec.com

This is a summary of the fifth episode of Fimpec’s “Kumppanit” podcast which discussed the investment possibilities in green transition projects. “Kumppanit” podcast is hosted by Maiju Hirvikallio, Fimpec’s Director of Communications & Marketing. The podcast is available for listening in Finnish on Spotify.

One crucial aspect when Veritas decides on investment targets is that they must generate sufficient cash flow within a reasonable timeframe. This requirement also applies to green transition projects, making them uncertain investment targets for pension investors in many cases.

“The green transition offers various investment opportunities, such as in energy production and the entire energy infrastructure. In principle, investments in energy infrastructure are suitable for pension investors if they guarantee a stable cash flow, ideally increased annually with inflation. If such opportunities are found, they are very interesting. Also, manufacturers of green transition technology, which are often even better investment targets than infrastructure projects, can be intriguing,” explains Kari Vatanen, Veritas’ Chief Investment Officer, in the podcast.

He continues by mentioning Veritas’ long-standing investments in wind power. In the early stages, the government’s price guarantee for wind-generated electricity provided the necessary certainty for projects. Currently, wind power projects are no longer as appealing from a pension investor’s perspective.

“There is no longer a price guarantee, and there is already so much green electricity available that in new projects, there must be certainty that returns will be generated even when all wind turbines are operational. This is why long-term purchase agreements are important from our perspective. If we invest solely in electricity production without knowing who will buy and at what price, it is too uncertain at the moment.”

Vatanen further emphasizes that it is a challenge for a pension investor if cash flow is expected only 10–20 years in the future. Especially in the current situation, where a 5% interest rate must be considered for financing, it becomes a significant cost over 10 years. According to him, the cash flow from basic infrastructure investments is not enough to compensate if the return starts only after 10 years. This applies not only to wind power but also to solar energy projects, as highlighted by Mikko Turunen, the CEO of Fimpec PMO, in the discussion.

“Such uncertainty can be too great for a pension investor because we need either immediate cash flows or, alternatively, a significant increase in value after ten years,” Vatanen states.

The breakthrough of the hydrogen economy requires a role from the government

Vatanen emphasizes that the hydrogen economy is important, and as an industrial strategy, it could be a winning theme for Finland. However, he does not believe it can succeed through private investors alone.

“From our perspective, the investment decision requires that the technology is profitable. We need a clear picture that the project is economically viable, meaning information about who will use the end product, where the cash flow will come from, and whether it is enough to cover the costs incurred when converting energy from one form to another.”

“In the early stages, when technology is being developed and there is no economically viable process available, public guidance is needed, and above all, a public actor must take the lead until the projects start to look interesting from the perspective of institutional investors. Public funding does not have to be the sole financier, but it must take the lead. A good example of such leadership was the guaranteed price for wind power, which got wind power production off the ground. As an advantage of public funding, I see patience and the fact that the time horizon can easily be 10-20 years. We don’t have that opportunity because we need cash flow to pay pensions every month,” he notes.

“We are talking partly about overcoming the transition period. What kind of collaboration models, project models, and product development models are really needed. Now is the time to determine the game that will solve the energy needs of industry and consumers well into the future,” Turunen adds.

The investment environment is currently challenging

The discussion also covers the investment environment more broadly. According to Vatanen, the current situation does not look particularly good.

“The situation is challenging. Economic forecasts for the coming months are negative. The main reason for this is that the interest rate is significantly higher compared to the situation a couple of years ago. Therefore, financing costs have risen significantly for all companies. At the same time, inflation has increased procurement costs, and wages are also rising. These three elevated cost factors affect simultaneously, and it is difficult to transfer their impact to the income side. The overall economic environment is challenging for many companies.”

Vatanen says that Finland’s situation is particularly difficult due to our economy’s reliance on exports. The weakened economic growth in China, among other factors, has hit European export industries, which is evident in both Finland and Germany, a crucial market for us. Economies that rely more on the service sector, including the United States, where economic growth is still positive, have performed better. Vatanen believes there may be some light on the horizon.

“At least on a hopeful level, we believe that the worst period will be in the winter, especially domestically. Many investments are on hold, and the expectation is that at some point, they will start to open up. The forecast is that economic growth could begin to pick up again after six months.”

» “Kumppanit” podcast page (in Finnish)

The utilization of heat pumps in energy recycling is currently increasing rapidly, and new applications are constantly emerging. At Fimpec, we have been involved in designing and implementing highly interesting projects utilizing heat pump technology, including energy companies’ heat production, industrial cooling solutions, district heating solutions, utilization of waste heat from data centers, recycling waste energy from biogas plants, and the latest area of green hydrogen production facilities’ energy recycling, where heat pumps are an essential part of the process with high capacities.

The range of projects and applications is indeed extensive, and there is nothing surprising about it. Heat pump technology enables energy recycling in various sizes and types of projects. The versatility of these applications is crucial to consider when aiming for the best efficiency and the shortest possible payback period in the chosen solutions.

Two less commonly discussed but crucial choices in a heat pump project are the connection method and refrigerant. Both are related to the temperature levels of the specific case – the temperature difference between the heat source or collection side and the produced heat, as well as the variability in temperature conditions. The importance of these choices has only increased as the size of facilities grows, and the diversity of applications expands.

Temperature requirements are a crucial factor in choosing the connection method

In terms of connections, there are various options available in heat pump projects, such as parallel connection, series connection, cascade connection either with refrigerants or through an intermediate fluid, and two-stage compression connection. The most important influencing factor in the selection is the previously mentioned temperature difference between collection and production temperatures.

Parallel connection is suitable for solutions where high temperatures are not required, with a typical example being the production of 60-degree heat for a district heating network.

Series connection is a good connection method when aiming for higher temperature levels. It is a reasonable approach, for example, in utilizing waste heat from data centers, where the 20–30-degree collection heat is transformed into approximately 90-degree heat for a district heating network.

Cascade connections are well-suited for industrial applications with low collection temperatures due to process cooling, and temperature levels vary. Cascade connections offer the possibility of utilizing intermediate circuits in these cases.

Refrigerants are transitioning to natural alternatives

Regarding the refrigerants used in heat pumps, a new transition phase is underway, guided by the EU F-Gas Regulation. The regulation aims to reduce emissions of fluorinated greenhouse gases used in heat pumps and encourage the use of refrigerants with lower Global Warming Potential (GWP).

Synthetic refrigerants, especially HFO refrigerants, have been under scrutiny, and some are already prohibited. The current F-Gas Regulation does not restrict the use of HFO refrigerants, but future regulations will likely impose limitations on them as well. PFAS compound emissions will also bring restrictions to refrigerants in the future.

Natural refrigerants, such as ammonia, carbon dioxide, and pure hydrocarbons like butane and propane, are alternatives to synthetic refrigerants. There are no restrictions or prohibitions on their use in the current F-Gas Regulation. However, the drawback is the flammability of pure hydrocarbons and the toxicity of ammonia. Partly for these reasons, the use of hydrocarbons has been limited, but it has increased recently, at least in externally located devices. New alternatives are also being developed, especially for industrial solutions, and in some cases, water could be used as a refrigerant.

My standpoint is, that in a heat pump project, it is advisable not to be stuck in advance with a single refrigerant option but to consider the size and power class of the heat pump and make a decision based on that. Similarly, it is wise to prepare for the future and choose a facility that uses natural refrigerants. In our own projects, we recommend and strive to choose an option that has minimal environmental impact, with a low or zero GWP value.

Ammonia is often a good option as a refrigerant, especially in larger sizes and specific temperature ranges. Its efficiency is excellent, and good configurations can be achieved with small charges. From an environmental perspective, ammonia has no long-term greenhouse gas impact, and a GWP value of zero. In industrial solutions, it is currently the preferred option due to its good efficiency and the long lifecycle achieved with proper maintenance.

However, it must be remembered that ammonia is a toxic gas. Therefore, safety must be ensured by considering laws and regulations, standard specifications, and safety equipment such as leak detectors, emergency ventilation, and possibly necessary sprinkler systems. The risk of toxicity is reduced by the fact that ammonia dissolves well in water, so even in the event of a leak, its entry into the environment can be prevented.

Growing need for skills and competences in emerging energy systems, cooperation with educational institutions is important

Choosing the right refrigerant and connection method are good examples of the expertise needed, especially in larger-scale heat pump projects. There will be an increasing demand for this expertise and skilled professionals in the future – including at Fimpec.

Therefore, we want to contribute to the development of this expertise and engage in strong collaboration with various universities. We offer guest lectures on developing energy systems, where heat pump technology plays a crucial role. Our experts also guide thesis projects related to the field. Feel free to get in touch.

For more information:

Mika Siekkinen, Manager, Energy Recycling Solutions
Fimpec, Energy Expert Services
tel. 040 416 6610, mika.siekkinen(at)fimpec.com