Finland, despite its relatively small size, has traditionally offered a vibrant technology environment. After all, the country brought the world the Nokia brand, the dominant mobile vendor before the likes of Apple and Samsung rose to dominance. Despite the downfall of the mobile manufacturer, Finland is beginning to focus on another segment that could bring it to the attention of the world, cleantech. Indeed, the eyes of corporate financing have been concentrated on the country’s dynamic energy start-up scene for some time, and sell businesses could be especially active with Finnish companies in the near future.
To some degree, cleantech makes much sense in Finland. The country has never been rich in fossil fuels and yet some of its largest industries include energy-intensive segments such as ship-building and mining. This awkward combination has forced local firms to focus on energy efficiency, driving investments in renewables and cleantech alternatives.
Aided by its mature start-up culture, illustrated by a unique cleantech incubator in Helsinki, Finland has seen a swathe of homegrown cleantech innovations, ranging from air-conditioner efficiency technologies, to waste recycling and lifts. Aside from the start-ups, large commercial firms such as ABB, KONE, Neste Oil and Wärtsilä also support the fertile cleantech environment.
The market is clearly aimed at business-to-business energy efficiency as opposed to consumer-facing technologies, with environmentalists criticising the country for some of its mainstream energy practices. Nonetheless, there is clearly a green attitude in the government and the business community. The country has fulfilled the EU agenda of having 20% of energy from renewables by 2020, with its own goal of 38% from renewables by 2020 already exceeded. The state has said that around half of its electricity and heat generation come from renewables, mostly from hydro.
Historically strict state regulation in the pulp and paper as well as mining industries has helped nurture valuable know-how in water efficiency and toxicity limitation. The country has essentially become a green model for industrialisation, providing clean solutions in what many had long perceived to be “dirty” industries. Another of Finland’s specialities is heat and power efficiency, driven by the twin factors of few domestic resources and harsh winter conditions. Local homes and business buildings utilise some of the most heat-efficient systems in the world.
This knowledge is especially in demand among pollution-battling emerging markets, such as India and China, and the government is well aware of the commercial potential. The state commits around half of its $790 million in R&D funding to cleantech, viewing it as a viable export commodity.
If Finnish start-ups can marry the combination of innovative and proven energy efficiency technologies with the marketing and presentation that has helped launch local mobile gaming giant Rovio, the country could represent a sizeable chunk of the global cleantech solutions pie. Business brokers are certainly already looking to connect Finnish cleantech knowhow with Silicon Valley cash.
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