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Newsletter of the Finnish Hydrogen Valley Association 4/2025

EDITORIAL

Wake up Finnish industry!

Good hydrogen valley,

The autumn winds are blowing and the days are getting colder, but that doesn't take away the warm memories of summer. Finland's Hydrogen Valley is pushing forward and taking our important message to different forums again after the holiday season.

The EC recently announced updates to its green transition data window. The outlook is relatively positive for this year, although there has been some bad news in the mix. According to the EC, the economy has started to turn for the better and the number of new investment releases has already exceeded the balance for the whole of last year. Now this investment machine needs to be fed and not new restrictions imposed, at least not with the new distance restrictions on wind power that have been proposed, and against which not only Hydrogen Valley but also hundreds of others spoke out in the heat of the summer.

Finnish industry needs a wake-up call. News of paper mill closures is a reminder of the importance of the forest industry to our economy as a whole. Now is the last moment to mobilise all the means to create competitiveness and investment in Finland. It is therefore vital that the forest industry's use of bio-based carbon dioxide is fully exploited, and that our unique and still existing but fading advantage is not lost.

The capture and use of bio-based carbon dioxide in the production of new chemicals, plastics, methane and synthetic fuels, for example, is a billion-dollar business opportunity that will increase the profitability of the forest industry, boost exports and create new jobs. It is a boost for all the processing chains and industries linked to the sector. Including the hydrogen economy.

All the latest investment news in P2X plants relies on Finland's special asset, bio-based carbon dioxide from forest industry smokestacks. The best example is the e-methane plant planned by Arctic Sisu in Kotka, which would use carbon dioxide from MM Kotkamills' pulp production, making it the first plant of this size in operation, possibly as early as 2028. Almost all similar P2X investment plans across Finland rely on similar sources of carbon dioxide. The question is the timeframe for getting them off the ground. Now, if ever, is the time to wait.

Accelerating investment requires many pieces to fall into place, and there are many in the green transition value chain. In addition to carbon dioxide, eastern Finland still needs a lot more clean energy - wind and solar power - and a more comprehensive and robust electricity transmission network. These topics are always at the top of the agenda of the Finnish Hydrogen Valley. That is why our defence energy programme ResilEast, which we are preparing, will remain very much on the agenda. We are currently preparing the programme, seeking funding and the best experts and partners for its implementation. The work around the programme is increasingly concrete. We will keep you informed of the programme's progress throughout.

See you at the autumn events, in Lappeenranta, Kotka, Joensuu, Helsinki now at least! Follow our communication closely, so you know where it's happening!

Jami Holtari

Jyrki Katainen: The vicious circle that paralyses investment can be broken by a military-civilian technology alliance

Former Prime Minister and EU Commissioner Jyrki Katainen, now Nordea's Chief Social Officer, in an interview with Vetylaakso Finland cited external geopolitical uncertainty as the main reason for the reluctance to invest. One of the solutions to the stalemate he points to is the benefits to be gained from the intertwining of defence and civilian technology.

In particular, the situation in Russia and the political instability in the United States - are undermining the momentum of both domestic and foreign investment in Finland. The hydrogen economy and renewable energy are not immune to uncertainty.

However, Katainen believes that Finland has several strengths as an investment destination: competitive energy prices, moderate corporate taxation, a skilled workforce, a stable and predictable society and low corruption. She said that labour market reforms have also been undertaken, which would help to support growth and attract foreign investment.

- Yet investment is not flowing as hoped, especially for large-scale energy and industrial projects in eastern Finland. If there were no war in Ukraine, if the United States had a stable president, I could see a significant amount of investment coming to Finland," Katainen says.

The vicious circle of uncertainty

In Katainen's view, general uncertainty is currently the biggest obstacle to investment. She also points to the domestic market situation: citizens have the economic purchasing power, but caution and uncertainty are preventing consumption. People have more savings now than at the time of the interest rate, but still housing sales have not picked up and consumption is sluggish. Purchasing power is at a good level, but it is not being used.

- It's just that general uncertainty; consumers don't spend when there's uncertainty in their minds and investors don't invest, especially big investment decisions are put on hold because they don't know how the world is going to change. The world situation is too unpredictable," says Katainen, describing the vicious circle.

In Katainen's view, Finland has not been a lucky charm in recent years.

- We have been unlucky: even before the war in Ukraine and Trump's policy volatility, Finland was suffering from low growth, but now the international crises have increased investment caution even more, he says.
- As a practical example of a factor that increases uncertainty, Katainen highlights Trump's tariff cuts.

The US has imposed tariffs on Europe, let's hope they keep them now.
Even that is better than them rowing and flapping back and forth. 15% is quite a lot, but it's something we could probably get used to," he says.

Growth incentive from the Civil-Military Technicians' Union

Europe and Finland are living through a time of historic change. The traditional defence industry - manufacturing arms and ammunition - is being joined by a rapidly growing technology sector, with products suitable for both civil and military use. The wide range of technologies made possible by this dual use is expected to be the next growth driver for Europe.

- The US technological lead has come about because civilian technology has created demand in the defence industry, while defence innovations have found their way into the consumer market. This trend has not yet been tried on a large scale in Europe - and this is a big opportunity for us," Katainen said.

In Finland, a few growth companies have already come to the fore with their multi-application technologies. As an example, Katainen cites a Finnish satellite company whose imaging technology was originally designed for crop damage assessment, but now plays a key role in intelligence for the war in Ukraine.

- This sector could be the source of the next growth cycle - first from small businesses, which will hopefully generate new contributions to national and European defence, he sees.

ResilEast programme attracts interest in Brussels: "huge potential"

Katainen highlights the ResilEast programme, developed by Eastern Finnish stakeholders, which aims to strengthen both energy and overall security in Eastern Finland by combining energy and military mobility projects. The programme, which has attracted the attention of politicians in Finland, has also attracted interest outside the EU's borders - and in Brussels in particular.

- If the challenges of wind farms and defence radar technology can be overcome, the potential is huge.

There is a solution to the radar problem. It is now a question of the technology chosen and its price.

Europe is now looking for new defence uses for EU regional development funding, where the benefits of the real economy and security are genuinely linked.

- I discussed this with Raffaele Fitto, European Commissioner for Regional Policy, who was very interested in the ResilEast programme. Fitto saw it as a model where public, semi-public and private funding could be combined.

Katainen stresses that national and regional investment programmes, such as ResilEast, are crucial for future growth and security. He particularly emphasised the Finnish capacity to develop technology and the opportunity to lead the way in Europe.

- This can also become a new growth engine for the Finnish economy, as long as we manage to combine the goals of defence, innovation and energy," Katainen says.

The development of resilience and technology-enabled total security could be a turning point that will bring both Eastern Finland and the country as a whole to the attention of the international community - a source of growth, security and new industry.

Factory Manager Matti Himanen hopes for practical benefits from Vetylaakso membership

Wienerberger is a supplier of ceramic building products such as bricks in more than 30 countries. In Finland, the largest product group is facade bricks and tiles. In Finland, the company has its headquarters in Helsinki and a factory in Kouvola. Wienerberger employs about 50 people in Finland, most of them in production tasks at the brick factory in Koria.

The Koria brick factory is managed by Matti Himanen, who stresses the importance of developing the south-east corner.

- When the Hydrogen Valley project was launched, I felt it was important that the South-Eastern region would be supported in a concrete way and that development would emerge after many difficult decades, Himanen explains the reasons for Finland's membership of Hydrogen Valley.

Another motivation for Himanen's membership was to keep up with the times; to be involved in the progress towards zero emission energy and zero emission targets.

- Hydrogen was seen as an opportunity to see if in the future hydrogen-based energy - whether liquid or piped - could be genuinely available and part of Wienerberger's emission reduction plans, he explains.

Himase's participation in Hydrogen Valley activities has been limited due to lack of time, and he has not felt that Hydrogen Valley activities have delivered exactly what he expected.

- In my opinion, it has been a bit theoretical; I have not noticed that our region in particular has benefited, or that concrete issues have been presented.
Himanen wishes to inform the members more diligently about pending projects and their progress. He is particularly interested in how hydrogen is produced and transported, and the timeframe for implementing these solutions in the region.

- Major energy and infrastructure projects are too often treated as distant programmes. Smaller companies are also interested in knowing the status of projects and equipment developments and how far away the actual deployment is. The newsletter has received praise from Mr Himase.

- A quarterly newsletter would be a good rhythm - not too frequent, but regular. It could include innovations in the field, examples from around the world and concise information on what has happened in concrete terms in Hydrogen Valley projects, he suggests.

Hima is also interested in webinars and company visits, but the daily challenge is lack of time. He would like to have remote meetings and recordable presentations so that he can watch them when it suits him. He is also interested in business visits.

- A couple of company visits a year would be the most meaningful pace.

"I want a peek behind the scenes"

Himanen says that a key wish for the development of communications is that members should know what kind of lobbying the association is doing towards politicians, for example, or what individual people, such as CEO Jami Holtari, are concretely promoting behind the scenes. This increases commitment and makes the association's work more transparent.

- Members would appreciate the sharing of experiences and peer support: if real practical experiences could be brought to the newsletter or events, it would increase the sense of community and help to find new ideas and solutions, Himanen says.

However, with resources, time and the economic situation often tight, especially in the construction industry, Himanen sees future value in Vetylaakso membership if the activities maintain interest and produce visible benefits. He hopes that membership recruitment will continue and dues will be in line with what individual members feel they receive.

- These are long-term things, but sometimes the benefits are realised, Himanen sums up.

VIEW

Hanna Holopainen, Member of Parliament for the Green Party

Hydrogen, wind and hope - Eastern Finland at the heart of the energy revolution

Russia's invasion of Ukraine and the closure of the eastern border have been a severe blow to eastern Finland. Trade, industry and tourism have suffered - and the vitality of the whole region has been put to the test. There has been sympathy in the speeches, but more concrete action is needed. Funding decisions and a timetable for infrastructure investment would prove that the government really understands the strategic importance of the region and is committed to long-term development. Let's hope that the budget session will result in good decisions. The border region must not remain a shrinking buffer zone from which residents and investment disappear. The specific situation of the border region must also be put on the table at all EU meetings.

Restoring vitality is a holistic task that requires effective communication links, improving accessibility, especially rail transport, safeguarding educational opportunities and developing nature tourism. Accelerating the energy transition is a particular priority. 

From an energy policy perspective, eastern Finland is not just the edge of the map. It can be the heart of Finland's energy future. The region has excellent potential for clean energy production: wind, solar and clean hydrogen can create a new industrial era, bringing jobs, investment and confidence in the future.

For now, there are obstacles to investment that need to be removed. There is also the question of regional equity. We deserve the same opportunities as in western Finland. Fingrid's grid is critical. Without strengthening it, new energy infrastructures cannot be built. Radar problems in the Defence Forces are preventing the construction of wind power. These technical challenges must be overcome to pave the way for a clean, decentralised and secure energy system.

Distributing wind power generation across the country will help keep the grid balanced. Energy independence and distributed generation are part of national security. Strengthening eastern Finland will contribute to the country's crisis resilience and security of supply. 

Development does not happen by itself. Nor does state intervention create anything more than a framework on which a profitable business can be built. Regional vision, investment and the courage to engage in the future are also needed from the business sector.

The ResilEast programme brings together in an interesting way the perspectives of total land defence, regional development and sustainable structural change. We hope that funding for the programme will be found. It offers an excellent opportunity to build a more sustainable, safer and more vibrant future.

The programme will help eastern Finland to move away from fossil fuels, modernise industry, reduce emissions and strengthen security of supply.

We cannot afford to lose this potential. Eastern Finland can lead the way - if given the chance. It is time to build the future - together, for the benefit of Finland as a whole.

NEW MEMBERS PRESENTED: Parikkalan Valo Oy

Parikkala Valo, almost 100 years old, is an active advocate of electricity network development and energy investments in Eastern Finland

Parikkalan Valo Oy was established in 1936 in Parikkala to electrify the area. As electrification progressed and electricity companies merged, the electricity distribution area has expanded to cover three counties and five municipalities.

Currently, Parikkalan Valo Oy is mainly owned by private persons.
The company's main business activities are electricity transmission and sales. Parikkalan Valo transmits about 140 GWh of electricity per year in the areas of Parikkala, Savonlinna, Rautjärvi, Ruokolahti and Kite. More than 2 500 km of power lines serve sparsely populated areas.

The company has about 10 000 electricity transmission customers and a turnover of about EUR 13 million.
The company sells electricity throughout Finland. All electricity sold by Parikkalan Valo Oy can be obtained entirely from renewable energy sources.

Parikkala Valo is involved in several energy production investments. The company has a small stake in the Olkiluoto 3 nuclear power plant and several stakes in wind power plants around the country. These holdings have come to the company over time through regional cooperation such as joint projects between Kaakon Energia Oy and other local energy companies.
Energy production projects - including wind, solar and counter-pressure power - are part of Parikkalan Valo's active investment strategy.

- We need to look for investment opportunities, especially in the South-East and Eastern Finland, where the potential and demand for renewable energy is growing. This is also based on the research and development work of the University of Lappeenranta and LAB University of Applied Sciences, as well as close cooperation with local developers and municipalities," says Olli Mattila , CEO of Parikkala Valo.

Mattila stresses that the resources of a small energy company are limited, especially in large production and development investments such as solar panel fields or automation technology. This is why cooperation with other energy operators, research institutes and municipalities is important. Parikkala Valo is therefore involved in funding and supporting professorships and development at LUT University and participates in several professional development projects.

Electricity network capacity and ageing concerns

The quality and capacity of the electricity network is a recurring concern for Mattila as a bottleneck to investment.

- The electricity system in the Parikkala area is based on wooden pylon grids built in the 1970s, where the capacity of the main grid is no longer sufficient to meet the growing needs of renewable energy and industry. Yes, it should be built here," says Mattila, who hopes to build a 400 kV transmission network on the basis of the regional plan's spatial reserve.

In practice, the lack of capacity is reflected in the everyday life of forestry and industrial companies; for example, Metsä Group's plans for the Simpelee and Punkaharju factories to install electric boilers may be frustrated by a lack of capacity - more than 100 MW would be needed, while Fingrid's current capacity is less than 100 MW.

Based on the expansion of the electricity network and capacity development, Mattila even proposes an active role for private grid companies in construction and financing. This is illustrated by the Eastern Grid project, a grouping of several energy companies in South-East Finland, where local energy companies themselves would take an active role in building the grid, thus ensuring the attractiveness of the region as an investment destination. In addition to Parikkala Valo, the project involves Lappeenranta Energia and Imatra Seudun Sähkö. At least Pohjois-Karjalan Sähkö and Savon Voima are expected to participate.

Itäverkko Oy would then be responsible for implementing the Vuoksi-Lapinlahti line. Even if no immediate return could be expected, the investments would be crucial for future competitiveness and would allow the network to be sold to the grid company at a later stage.

Hydrogen will come, but patience is needed

Mattila recognises the potential of the hydrogen economy and the green transition - but also highlights the challenges in developing profitability, cost structures and ecosystems.

- Hydrogen is coming, but its breakthrough and profitability will require patience from financiers and many elements falling into place, Mattila summarises.
Parikkalan Valo is following research in the field and is ready to invest in pilot projects such as the biogas project being built in Parikkala. The challenges of profitability calculations and the lack of international examples, such as the German model, are slowing down the uptake of large-scale industrial hydrogen solutions. We should have case studies where the first investment shows profitability - then the market would open up to new players.

Mattila believes it is important for the development of the sector that the challenges, opportunities and concrete investment needs are widely highlighted at trade fairs, in the media and to policy makers.

- Continuous communication of the need for capacity, especially in the electricity grid, is crucial for the energy future of eastern Finland as a whole.

NEWS FROM US AND THE WORLD

A major European-scale e-methane plant planned for Kotka - renewable fuel for shipping and industry

A major investment in clean energy production is planned for Kotka, as Finnish company Arctic Sisu Corporation Oy has announced its intention to build a large-scale e-methane production plant. The three-phase project aims to produce 900-950 GWh of renewable e-methane per year to meet the energy needs of maritime transport.

The plant will be built next to MM Kotkamills Oy's pulp and paper mill and will be the first in Europe to use carbon dioxide from the pulp production process as a raw material for e-methane. This innovative approach will enable up to 50% of the mill's current CO₂ emissions to be captured and reused, while utilising industrial side streams and waste heat, further reducing Kotkamills' overall emissions.

Arctic Sisu said in a press release that the project already has a client. The aim is to have a final investment decision during 2026, with commercial production of the first phase planned to start in 2028. The whole project is divided into three phases, each worth around €300 million.

- This project is an important step towards a green transition and a demonstration of the attractiveness of the Kotka-Hamina region as an investment destination. Arctic Sisu's investment will not only bring new jobs to the area, but also strengthen the region's position as a pioneer in renewable energy and sustainable industry," says Ilkka Hasanen, Director of Invest In at Cursor Oy.

- The Arctic Sisu project is a shining example of industrial symbiosis and I am very pleased that this investment of this magnitude is being implemented in the industrial and port city of Kotka," said Toni Vanhala, Development Director of the City of Kotka.

The investment will strengthen Kotka's position as a centre for clean energy production and provide significant opportunities for industry and logistics in the region. It is a concrete demonstration of how public-private partnerships can promote sustainable development and economic growth.

Webinar info for our members starting 23.9: What legal issues to consider in renewable energy projects

Webinar info for our members starts on 23.9: What legal issues to consider in renewable energy projects

Date: Tuesday 23.9. at 13.00-14.00

Experts: Senior Associate Karoliina Rytkönen, Bergmann Attorneys at Law

                        Miko Huomo, CEO, 3Flash Finland Oy

Senior Associate Karoliina Rytkönen:

  • The pillars of the project: what are the elements - from permitting to land acquisition and on to contract chains - that make up a productive project?
  • Safety aspects from a lawyer's point of view: what are the legal obligations for establishments, their processes and their staff in terms of fire and explosion hazards?
  • Success in regulated markets: how do regulatory measures such as mandates and emissions trading create opportunities for green solutions, and how to be renewable or low-carbon in the right way to meet this demand?

CEO Miko Huomo:

  • Bankability and licensing: building permit, its validity and the establishment of and liability for costs.
  • Electricity price uncertainty: how to account for PPAs, options and hedging models as hedges of common interests so that the project's profitability can withstand market pressures.
  • Demand growth and contract risks: from the perspective of the project developer and the investor, it is critical that the contract structure does not unilaterally shift the risk of demand fulfilment to the producer. From the developer's perspective, the PPAs and other contracts should be structured in such a way that the risks, in particular, are more evenly distributed to the offtaker.
  • Changing regulatory environment: the developer must manage long transition periods and ensure that contracts are flexible in the face of possible legislative changes.

A webinar is a discussion forum with experts, where you can ask questions. The webinar will be recorded, so if you can't attend, you can watch it at a time that suits you. If you have any questions about the event, please contact: tommi.siikaniva@vetylaakso.fi 0400 885 747 

Mark your calendar here: Welcome to join us!

UPCOMING EVENTS

Future Energy Solutions 9.-10.9.2025 in Lappeenranta

The international Future Energy Solutions conference is held in Lappeenranta, Finland. The main theme is energy innovation and the conference sessions will focus on digital energy systems, the hydrogen economy and future mobility.

The keynote speakers are Sari Multala, Minister of Climate and Environment, and Pasi Vainikka, founder and board member of Solar Foods Oy. Top-level speakers from both the energy industry and the research community will be present. The varied programme includes workshops, visits and networking opportunities in the partner exhibition area and during the evening programme. Hydrogen Valley Finland is one of the organisers of the event.

Register at click here

The Finnish Hydrogen Valley Municipalities Network convenes on 17 September.

Welcome to Helsinki on Wednesday 17 September at 17.30-19.00 at the end of the first day of the Municipal Market to network and find out what issues your municipality needs to consider in terms of green investments. An informal networking event at Restaurant Juttutuva (Säästöpankinranta 6, Hki), where snacks and refreshments will be served on behalf of the association. The programme for the evening includes 

  • How we build an energy ecosystem in your municipality
    • Greensky Energy / Iines Veistola
  • Repatriating green investment to your municipality
    • FCG / Pauli Santala, Jaana Myllyluoma
  • News from the Hydrogen Valley and how the network of municipalities will continue to work
  • informal socialising

The event is aimed at municipal members of Hydrogen Valley Finland, but is open to all other interested parties. Please let others in your organisation know if you cannot attend. And you can also tell your friends! Please register by the evening of 15.9. to tj Jami(jami.holtari@vetylaakso.fi) to ensure catering.

See the Municipal Market programme here

European Hydrogen Week Brussels 29.9.-3.10.2025

European Hydrogen Week 2025 is Europe's largest hydrogen event, bringing together industry leaders, companies, policy makers, researchers and investors in Brussels to discuss the role of hydrogen in Europe's green transition and future energy system.

Check out the European Hydrogen Week programme here.

Watch a video of last year's event here.

Eastern Finland Energy Forum

This year, the Eastern Finland Energy Forum is going international. Join the two days of discussions on the following topics:
- Hydrogen/bio-economy and infrastructure
- Energy transit and resilience
- Circular economy and biogenic CO₂
- Green transition and security at the eastern border
- Social acceptability, knowledge and hydrogen innovation

Find out more about the programme here.

Come and meet Hydrogen Valley Finland at our stand at Technology 25!

The leading technology and industry event in the Nordic Region showcases the latest technologies for smart and sustainable industry.

Register at here.

Hydrogen Valley Finland will participate in the Hydrogen Summit in Tampere on 14-15 January. We have reserved a booth for 10 of our members. Send a message to Jami or Tommi and we will tell you more!

Join us now!

The Finnish Hydrogen Valley Association provides its members with interesting and up-to-date information on the opportunities offered by the hydrogen economy and renewable energy. We are your organisation's voice in the industry and make sure that the issues that are important to you are brought to the attention of decision-makers. We network actively, meet energy industry leaders on a regular basis and get the latest information on industry developments for your benefit.

We will provide you with regular briefings on industry developments, company visits, a newsletter six times a year, media coverage on topics that are important to you, visibility on social media channels and we will be your organisation's communications support to get your message across to your stakeholders. Looking after your interests is our job.

Join our growing team here or call Jami Holtari 040 055 1435 or Tommi Siikaniva 0400 885 747 and we'll tell you more.

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