Seppo Ahola Arctic Advisor Digipolis Ltd

”CO-OPERATION MODELS FOR CIRCULAR ECONOMY”

New business models for smart regions Rohevik, September 21st, 2017 DIGIPOLIS - KEMI TECHNOLOGY PARK

•Kemin Digipolis Oy, established in 1993 •Owned by the cities of Kemi & , (the city of Kemi is main owner) the University of and municipalities of Simo, and Tervola • 50 companies, 500 employees in technology park – Network of more than 160 industrial service businesses in , more elsewhere •Development actions and services: •Team 10 persons + service providers •Innovative environment especially for industrial service businesses •Start-Up, Business Incubation, Business Growth, Invest In Services •21 on-going development projects, 584 companies and organisations •New openings: 2008-2016 Expertise on Arctic conditions & Industry, novel wood constructions: CLT development platform 2012- Ecosystem of the Arctic Industry - Innovation Platform 2014- Arctic Industry and Circular Economy Cluster management 2016- Digipolis chosen as key actor in national circular economy roadmap and implementation of the key project activities 2017- Establishment of Centre for industrial circular economy MAIN INDUSTRY SITES IN KEMI-TORNIO REGION

Metsä Board and Metsä Fibre Kemi mills • World’s northernmost linerboard production site • World’s northernmost pulp mill

Outokumpu Chrome Kemi mine • Europe’s biggest mine

Outokumpu Tornio stainless steel mill and ferrochrome smelter • Outokumpu's site in Tornio is the most integrated stainless steel mill in the world combining chromium mine, ferrochrome works and stainless steel mill

Stora Enso Veitsiluoto Mill in Kemi • World’s 2nd northernmost pulp mill • World's northernmost paper producer with three paper machines, and 4th biggest paper production integrate in Europe • Oldest sawmill in production in Northern

Kaidi Biorefinery investment plan in Kemi • Kaidi is planning a globally unique biofuelrefinery to Kemi in 2019

Manga LNG liquid natural gas terminal in Tornio 2018 NATURAL RESOURCES REFINING

• Global Markets • Good Connections • Arctic Solutions • Cleantech Solutions • 5 Bio Refineries • 32 Sawmills • 16 Mines • 5 Metal Refineries Kemi • 2 Aluminium Smelters • 1 LNG Refinery 200 km • 2 Chemical Plants ECOSYSTEM OF THE ARCTIC INDUSTRY Kemi-Tornio’s circular economy innovation platform

• Worlds northernmost hub of bio-, mining -,

metal industry and services Tapojärvi mine operations Pohjaset • 1,7 Mt of by-products and residues (without waste rock) SMA-Mineral Digipolis Ases

CLT development • Responsible for 80% of Lapland’s industrial platform production, with over 5 billion EUR of exports annually (7-8 % of the total export value of Finland)

• Industrial symbiosis estimated at 700 million Kaidi bio-refinery EUR annually Ikea wind project farm project Modern Cluster of Arctic Industry

Sustainable utilisation of arctic natural resources Sitra • 21.9.2016 • Kari Herlevi • 7

FEASIBILITY STUDY 2016

NORDIC COUNCIL OF MINISTERS’ SUSTAINABLE NORDIC BIOECONOMY CASE IN CIRCULATE CATEGORY

The Kemi-Tornio region in northern Finland has established an Arctic industry and circular economy cluster to enhance industrial symbiosis and strengthen the development of a holistic bioeconomy in the region. Via extensive analysis of the by-products and residue streams from companies in the region, value-added products are now being produced by combining and rethinking several by-product and residue streams. Examples include silvicultural thinning practices, bioenergy from forest residues with the possibility for future for largescale biofuel production, as well as two plants that enable recovery of metals from slags from the steel and ferrochrome production in the region. 1 . 7 m i l l i o n FINNISH NATIONAL INDUSTRIAL CIRCULAR ECONOMY CENTRE IN KEMI • Focus is in the circular economy and the bioeconomy • In partnership with the Finnish Innovation Fund Sitra, City of Kemi, Digipolis – Kemi Technology Park and Lapland University of Applied Sciences • First industrial circular economy centre in Finland with national level mandate • Virtual network of industry, university and development experts

Aims of the centre: National level • To promote education and competence in the industrial circular economy across the whole of Finland • To spread operating models of the Kemi region’s industrial circular economy throughout Finland • To boost the successful circular economy development work that Digipolis – Kemi Technology Park has carried out and to generate vitality for the city of Kemi and for the whole of Finland City of Kemi and Lapland level • To create new investments and jobs – Industry modernization • Help investments to be more sustainable and efficient • Lapland is Europe’s model region for the sustainability: modern cluster development in the sustainable refinement of natural resources • Establishing common systematic operational culture  Activation and cooperation of authorities, municipalities, industry, industrial services etc. BIO AND CIRCULAR ECONOMY CASES

• Kaidi biorefinery factory project (900 million €) and surrounding ecosystem

• smelter (300-500 million €)

• Industrial symbiosis recycling center and facilities (50-200 M€); 1,7 million tonnes of by-products from regions industry annually

• Ship recycling facility (65 million €)

• Cross laminated timber (CLT) production facility integrated with sawmill (20 million €)

• Bio coke production facility (12 million €)

• Seafood refinery (12 million €)

• Novel biogas plant with circular economy solution (10 million €)

• Chemicals terminal (5 million €)

• Berry pulp production facility (4 million €)

• Finding /developing and testing of resource efficient biomass drying technology and supply chain from forest to biorefinery process SUSTAINABILITY ASSESSMENT TOOL - SAT SAT Quick and dirty method

ENVIRONMENTAL INDICATORS ECONOMIC INDICATORS (UPDATING IN PROGRESS) SOCIAL INDICATORS AIR EMISSIONS LEADERSHIP & STRATEGY LOCATION MANAGEMENT & WATER EFFLUENTS REPORTING ECONOMIC SUPPLY CHAIN SOLID RESIDUES PERFORMANCE & VALUE GENERATION AND SOCIAL INNOVATIONS PROCESS AND PRODUCTION INVESTMENTSDISTRIBUTION & EFFICIENCY MARKETS LABOUR PRACTICES TRANSPORT CIRCULAR ECONOMY & TRAINING AND SKILLS RESOURCES GREENHOUSE GAS EMISSIONS SUPPLY CHAIN REPORTING MANAGEMENT AND RISKS REPORTING HEALTH AND SAFETY RESEARCH & DEVELOPMENT ENVIRONMENTAL INNOVATIONS LEGAL ASPECTS ECONOMIC INNOVATIONS & LEADERSHIP AND STRATEGY COMPETITIVENESS

LEGAL ASPECTS LEGAL ASPECTS + Covers Regional Economic Dimension (RED) by VTT SAT AND IT’S USE Case 2. Need for additional wastewater treatment unit Environmental authority requirement

• At mill and industry integrate level: • to evaluate the single investment and/or mill site operation chain sustainability, including supply chain management’s sustainability • At corporate level: • to evaluate sustainability of company’s mill sites (helps when investment money is shared) • to give valuable information for greenfield mill investment • to give valuable information when you want to buy the existing factory BIOREFINERY BOOSTS NEW ECOSYSTEM

1. Biofuel refinery opens up new raw material market • Currently more energy wood is harvested than used • Biorefinery can also use other forest industry by-products

2. Biorefinery would improve resource efficiency and create synergies • Energy wood is residue from forest thinnings and harvesting – Optimal use of woody biomasses • Synergies with current biomass logistics, terminals and production sites

3. Biorefinery would create new ecosystem • Unique production site refining certified and renewable natural resources • High value addition from excess natural resources: over 8 million m3 more wood grows annually that is used in Lapland • Industry modernisation and sustainability

4. New opportunities for eco-innovative service companies • Possibilities for novel harvesting, logistics, terminal and service solutions • Cross sectoral value chains?

5. Indirect effects on regional economy BIOREFINERY AND INNOVATION

Digitalisation – Industry 4.0 • Forest information database and management system  Implementation for the forestry ecosystem • E-trade system and life-cycle services for woody biomass land owners

New business and operational models • Totally new supply chain for energy wood: harvesting technologies, terminals, drying of raw materials, logistics: containers and transport units, whole ecosystem around biorefinery (biomaterial utilisation and biodiesel refinery): suppliers and industrial symbiosis, integrated wood production units – better customer perspective on product categories

Technology and R&D&I • New harvester models (Fixteri for example) and harvesting equipment • Demonstration plant – first of many: long term continuous R&D&I and resources – monitoring, R&D&I, testing, piloting, scaling-up, manufacturing, commercialisation, internationalisation Regional innovations and pilots

EUROPE’S FIRST INTELLIGENT BICYCLE AND WALK PATH USING INDUSTRIAL RESIDUES

OKTO SLAG INSULATION 35 m

PUPIL’S PATH, KEMI

CIRCULAR ECONOMY INDUSTRIAL CLUSTER INNOVATION PILOT: CAIM - Circular Arctic Infrastructure Materials 1.1 – 31.12.2017 Regional innovations and pilots

EUROPE’S FIRST INTELLIGENT BICYCLE AND WALK PATH USING INDUSTRIAL RESIDUES

REAL TIME FROST MEASUREMENT & OKTO OTHER INTELLIGENT TRANSPORT SLAG SYSTEM APPLICATIONS INSULATION 35 m

PUPIL’S PATH, KEMI

CIRCULAR ECONOMY INDUSTRIAL CLUSTER INNOVATION PILOT: CAIM - Circular Arctic Infrastructure Materials 1.1 – 31.12.2017 BALTIC SEA REGION COOPERATION

Pilot project proposals submitted to MA-network

• Funding through: ERDF MA-network for Baltic Sea Region Zielona Chemia, Polen (West Pomorski Region) PAKRI Science and Industrial Park (Estonia) • Policy instrument: Regional Smart Specialisation Strategies Kemin Digipolis Oy (Region of Lapland) • Topic: Clean-tech Brandenburg Invest (Region Brandenburg) LITBIOMA (Lithuania) TURKU University of applied science (SouthWest Finland) Green Net Finland (Helsinki Uusimaa Region Finland) Clean-tech collaboration to enter new markets Innovation Centre Iceland (Iceland) 1. Jointly entering new challenging markets Cleantech Latvia Cluster (Latvia) Merinova (Region Osterbothnia Finland) Clean-tech collaboration for feasibility studies, to test and verify solutions North Sweden Cleantech (Region Västerbotten Sweden) 2. Commercializing forest-based protein Sustainable Business Hub (Region Skåne Sweden) Lahti Development Center (Päijät-Häme Region Finland) 3. Municipal operator symbiosis-circular economy 4. Increasing the share of renewable energy e-Mobility Clean-tech collaboration for technology and knowledge transfer 5. Testbeds for testing and verifying new clean tech solutions CIR©LEAN 2018-2019 CHEMICAL INDUSTRY CROSS-BORDER MINING INDUSTRY LIME CALCITE REUSE METAL SEPARATION RUBBER OIL POULTRY FEATHER INSULATION CROSS-SECTOR FORESTRY; PULP, PAPER, PLASTICS OIL SALMON PROCESSING REAL BUSINESS CASES BOARD, TIMBER SLUDGE METAL SEPARATION SLAG INSULATION

METAL INDUSTRY BIOMASS REUSEFISH FEED PROTEIN OPEN INNOVATION FISHING INDUSTRY WASTE INDUSTRY

R&D

SME EDUCATORS CIRCULAR ECONOMY INDUSTRIAL AUTHORITIES BUSINESS MODELS SYMBIOSIS BUSINESS DEVELOPERS

FINANCIERS ”NEW INDUSTRY” THANK YOU! Interested in cooperation?

Please contact:

Taisto Saari / Stora Enso Seppo Ahola, Mr. Arctic Advisor Digipolis - Kemi Technology Park Tietokatu 6, FI-94600, Kemi Tel. +358 400 249620 Outokumpu

Jaana Moona Design ja Studio Imagiar [email protected] www.digipolis.fi

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