Environmental exports require new models and funding instruments

Release 28 November 2007

A report on funding and new business models for environmental exports has been published. Information was gathered from companies in the field to identify development areas in export funding and new business opportunities which aid the natural environment in the Baltic region, Russia and Ukraine. The project was carried out by Green Net Finland. The project was financed by Sitra’s Environmental Programme, the Uusimaa Region, Tekes and the companies involved.

The report introduced the new FinRESCO4 operating model, in which energy auditing, and the efficiency-increasing measures identified during such an audit of heat production, distribution and end use, are provided to clients as a tailored solution. FinRESCO was developed for renovation projects on public buildings, in particular, and it promotes the use of bioenergy and clean technologies both in the production of heat and the renovation of plumbing and buildings as a comprehensive customer-specific service. This will help secure funding for profitable projects, while contractors can identify new project opportunities. The first consortiums for the purpose are currently being created.

The model has been jointly developed by companies such YIT and Vapo, in collaboration with a number of SMEs. The proposed operating model will be exported, with special attention paid to the newer EU Member States, where it is believed there will be demand for it due to the targets set by the EU on energy emissions and the increasing use of renewable energy in the coming decades.

The report and the project planning undertaken by the companies involved clearly indicate what the challenges related to funding are. To speed up project planning and the entry of Finnish enterprises to the market, the report suggests that a special project planning fund be established. It could concentrate on funding feasibility studies and energy audits on selected markets. During project planning, the reduction of CO2 emissions precipitated by the projects could be a kind of advance payment. – The project planning fund is an exciting idea, says Jukka Noponen, an Executive Director from Sitra. – And the need for it has emerged on several occasions in the course of Sitra’s Environmental Programme.

A special need for the new funding instrument has been created by the market trend where clients are shifting towards demanding more comprehensive turnkey solutions, although few individual companies are able to deliver. This requires closer collaboration between suppliers, project management across the entire operation, and larger investments in project planning.

In addition to a new operational model, the project has also resulted in seven concrete offers, two spin-off projects and several market- and sector-specific reports in the target countries. The companies involved came to a common understanding of the opportunities available in the selected business sectors, and developed a much better knowledge of customer needs. In addition, they made new contacts with the decision-makers in both government and private industrial enterprises, which may result in new business opportunities in the future.

The role of Green Net Finland in the execution of the project was to build company networks, to identify potential collaboration partners and business opportunities in the target countries, and to lead the development of new operative models.

Altogether, the project involved 10 companies: Onninen Oy, Vapo Oy, Gaia Consulting Oy, GreenStream Network Oy, Kemira Oy, Preseco Oy, Planora Oy, Metso Power Oy, Pöyry Energy and Wärtsilä Biopower Oy.

Publication details

Green Net Finland: Hassinen Anu, Hietaniemi Lauri, Lutfi Evilina
Ympäristöalan viennin rahoitus ja uudet liiketoimintamallit: Case-kohteina Baltian maat, Venäjä ja Ukraina (in Finnish only)
(Environmental exports funding and new business models: Cases in the Baltic countries, Russia and Ukraine)
Research report
ISBN 978-951-563-611-9 (URL:https://www.sitra.fi)
Load the report (pdf file in Finnish) »

Further information

Jukka Noponen, Executive Director, Sitra’s Environmental Programme
Tel. 358 9 6189 9430, 358 40 587 4323, forename.surname@sitra.fi

Lauri Hietaniemi, Managing Director, Green Net Finland
Tel. +358 9 8700 6331, +358 40 553 2764