What if you could take the waste side streams from your current processes and use them to create completely new products in your portfolio? Or use renewable, bio-based material instead of the old, non-sustainable resources?

Written by: Pekka Pekkala — 

These are the promises of the circular bioeconomy. However, they also pose a challenge: how do you pilot and test new products without investing heavily in research and infrastructure?

Bioruukki, the bio-based circular economy accelerator

The answer is to partner with services like VTT’s Bioruukki, a massive pilot center for bioeconomy and cleantech research in the Helsinki metropolitan area. It is designed to accelerate the bio-based circular economy. A successful example of this is the Finnish energy company Fortum’s bio-oil plant in Joensuu. It turns forest residues into bio-based oil using fast pyrolysis, a process that was piloted by VTT. The project also proved that the piloting services in Espoo could serve the whole country.

In addition to thermochemical conversion, such as pyrolysis or gasification, Bioruukki offers opportunities for organizations to test new products using sustainable chemistry or biomass processing. It is a shared resource that businesses can use on demand, thus reducing costs and improving efficiency. This is a new example of a sharing economy, also known as the Uber model, brought to the circular bioeconomy.

Bioruukki offers opportunities for organizations to test new products using sustainable chemistry or biomass processing.

Jussi Manninen, who oversees Solutions for Natural Resources and Environment Business at VTT, stated that Bioruukki is not focused on one industry, but instead it makes it possible for different sectors to co-create and innovate with partners they never would have thought would  be a good match for growth opportunities. This idea of cooperation is important, especially for small countries such as Finland. By optimizing resources, we get results faster and more cost-effectively.

“Around metropolitan Helsinki, we have this beautiful ecosystem that supports this idea: VTT with 400 experts, Aalto University next door, the Natural Resources Institute Finland, University of Helsinki… Finland has the woods and the heads to innovate, you can check any global index to support that idea,” Manninen explained.

How to grow like a startup: partner up

An ecosystem like the one around VTT offers considerable growth opportunities for companies ready to experiment. As scary as it sounds, partnering with an outside source that has expertise makes a company more successful. A good example of this is Neste, the Finnish-based oil refining and renewables company. For this business, biofuels have become a profitable, billion-dollar business. However, Neste biofuels required quite a bit of research and piloting, with the help of VTT.

When Neste invented and patented a crucial technology related to biofuels in the 90’s, it had no idea it would lead to modern renewable diesel plants in Finland, the Netherlands, and Singapore, making Neste the leading producer of renewable biodiesel in the world today.

Lars Peter Lindfors, senior vice president for technology (including research & development, IT, procurement, investment management, and business processes), explained how Neste managed to escape the innovator’s dilemma and grow like a startup, without disrupting its old business model.

“We have created a completely new business from renewables and biofuels. Five years ago, the renewable business did not contribute financially. In 2016, roughly 50 % of our one billion euro profit came from renewables. We achieved this without cannibalizing the traditional business models inside the company.”

Extend your core competence without large investments

The way that VTT works with industrial companies like Neste is to offer them a versatile set of pilot plants for multiple industrial development chains. These cover everything from raw material sourcing and processing to smart industrial conversions or application testing and demonstration. These facilities combined with know-how from in-house professionals speed up the commercialization of new products, helping companies to extend their core competencies without the need to invest heavily in facilities or talent themselves.

Chemigate Ltd. is a Finnish company that sells modified starches for technical applications, such as binders in the paper industry. Its markets are in Europe and Western Russia. According to its R&D manager Aki Laine, VTT has been a long-standing partner when scaling up production with new inventions.

“There are some new processes that cannot be tested reliably on a small scale. VTT has the infrastructure to run larger, pilot-scale experiments. With its help, we ensured that our newest plant was operational from day one,” was how Laine explained Chemigate’s relationship with VTT.

VTT has also helped Chemigate to realize proof of concept for completely new manufacturing processes and create a solid basis for long-term product development.

Surprisingly, most of Chemigate’s products are already in the green chemistry category, since it uses raw materials such as grain, potatoes, and tapioca. From this perspective, the current trend towards a bioeconomy or a circular economy is nothing new to the paper industry, as starch has been used in papermaking for centuries and chemically modified starches have evolved decade by decade alongside the modernization of the paper industry.

Next steps in scaling up a new venture

VTT has partnered with Neste for many years, from the pine oil inventions of 20 years ago to the current-day large pilot project looking at wood-based fuels together with the pulp and paper manufacturer Stora Enso.

“We have our own, large-scale pilot facilities, which enable us to do a lot of product development and testing ourselves. However, we are happy to hire both minds and equipment from VTT when we have a suitable project and need to scale up,” Lindfors stated.

Chemigate’s Laine has had similar experiences. In its latest project with VTT involving its polymers group, it tested new processes at VTT for a few years. Based on the promising results, it decided to build its own pilot facility – a large investment decision that would not have been possible without external help.

Both companies have upcoming projects as well. The next step for Neste is to use an even broader range of renewable sources and to find new side streams from the circular economy. It is also exploring bioplastics as a new product group.

“Working with VTT gives us an option to cut down the time to market, especially when we are considering completely new raw materials, products, or product categories,” Lindfors explained.

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