Finland is a world leader in combined heat and power with high levels of development in district heating, industrial energy production and use of biofuels, says the IEA.
19 December 2008
One of the world's largest biolfuel fired co-generation plants operates at UPM pulp and paper mill at Pietarsaari,
Finland. The awarded plant, owned and operated by Alholmens Kraft, is the prime example of sustainable energy
Finland - a world leader in combined heat and power
Finland is a world leader in combined heat and power with high levels of development in district
heating, industrial energy production and use of biofuels, praises the International Energy Agency's
report that awards Finland with the highest possible number of points.
In its country report released in February 2004, the IEA already commended Finnish energy policy
for being remarkably well implemented and for simultaneously supporting economic growth,
meeting environmental challenges and securing the country?s energy supply.
In November 2008, the IEA?s report summarizes the applications of combined heat and power
(CHP) - also called co-generation - in Finland, discusses the impact the government has had on its
development, and provides policy options that can be used to extend the use of co-generation.
"Finland is a world leader in prioritizing combined heat and power/district heating-cooling, with a
clear and proven strategy for bringing about significant market development and the
implementation of at least one global best-practice policy measure," says the report.
In 2007, co-generation produced 74 percent of the heat needed for district heating and generated 29
percent of the country?s electricity supply and 34 percent of production. Its share of thermal
electricity production has been high for several decades, and was 65 percent in 2007.
Co-generation systems generate electricity and useful thermal energy in a single, integrated system.
The thermal energy recovered in a system can be used for heating or cooling in industry or
The total efficiency of the systems is typically more than 85 percent while the separate systems
have an efficiency of only 45 percent.
Increasing domestic energy
The high national level of co-generation's utilization has been achieved with little direct government
support. In a country with a cold climate and limited resources of energy, it has been the natural
economic choice for many applications.
Highly economic and mainly centralized co-generation has offered favourable energy prices ? low
prices even at the European level ? to Finnish customers. Regardless of low sale prices, it has been
a successful business to its owners, usually municipalities, estimates the IEA's report.
The main drivers of co-generation have been the need to reduce energy imports, the need to
maximize economy of energy supplies, and in some cases, governmental energy taxes that increase
economic attractiveness of co-generation over heat-only generation.
Local co-generation brings many benefits
Finland needs a lot of energy due to its energy-intensive industry and cold climate and long
distances. At the same the country's domestic resources are scarce.
District heating is a natural form of heating in densely-built areas. Co-generation of district heat and
electricity saves one-third of fuel compared with separate production of electricity and heat, and
reduces emissions respectively.
Almost 95 percent of apartment buildings and most public and commercial buildings are connected
to the district heating network. In the largest towns, the market share of district heating is more than
90 percent - the City of Helsinki as an example (see separate article).
From large and to small scale production
The roots of Finnish co-generation are in the country's forest industry, that started to utilize its
byproducts for producing heat and electricity since several decades ago.
The co-generation plants at wood processing plants, use local fuel sources and are located close to
where electricity is used. This kind of co-generation reduces local emissions, secures power supply,
minimizes need for new transmission lines, and benefits for the local economy.
This also was the main goal for Alholmen Kraft's plant in Pietarsaari on west coast of Finland. The
plant utilizes byproducts created by the pulp and paper mill as well as the sawmill, i.e. bark, wood
residues and forest residues.
With thermal capacity of 550 MW and electrical capacity 265 MW (in condensing more), the co-
generation plant produces 100 MW process steam to pulp and paper mills, and about 60 MW
district heat to UPM and the city of Pietarsaari.
An example for industrial small-scale co-generation is a plant, owned
by Biokraft Oy, that produces electricity with capacity of 1.8 MW and
heat of 3.5 MW for Finnforest Corporation's sawmill in central
The plant produces over 70 percent of the electricity needed by the
sawmill as well as all the heat needed for wood drying.
More than that, the plant also produces most of the district heat required for the nearby town of
Vilppula with its two thousand inhabitants and local industrial enterprises.
Developing an efficient energy system has for decades had a high priority in Finnish energy
strategy. This, in turn, has resulted in the building up of world-class expertise in related technology
The technology used in co-generation including fluidized bed boilers, engines, and control
techniques has been mainly developed in Finland.
Major success has been achieved energy technology exports that reached a value of EUR 4 billion ?
or almost doubled since 1997.
One of the recent landmarks is when Metso and Wärtsilä formed a joint venture, MW Power Oy,
which will combine their resources and expertise in sustainable energy production.
The MW Power, starting in the beginning of 2009, will be one of Europe?s leading providers of
medium- and small-scale power and heating plants for renewable fuel solutions.
Sources an more information:
The IEA report
CHP and district heating - a great possibility for Europe
Finnish power plant providers combine their forces for renewable energy solutions