Finnish energy company St1 is starting production of bioethanol from sawdust. The company is planning to construct its first bioethanol plant that uses cellulose-based raw material in Kajaani, Finland, where the company has already signed a letter of intent for the lease of a site and building.

St1 intends to use sawdust in addition to biowaste and process waste from the food industry to manufacture fuel.

The company reports that it is seeking locations for three to five ethanol plants that will be able to use sawdust, a by-product of the sawmilling industry.

St1 estimates that the plant’s annual production capacity will equal ten-million litres. Lignin, a compound derived from wood, is also a by-product of sawdust-based ethanol production and can be used in the production of electricity and steam.

The company’s objective is to make the decision concerning the investment in the new plant this year. If the project materialises, production could start in 2015.

St1 believes that the greatest potential of ethanol production lies in cellulose-containing raw materials, such as sawdust, straw and recycled fibre. Currently, the company’s five Finnish plants manufacture ethanol for use as a transport fuel from biowaste and process residues resulting from the food industry.

One of the challenges related to ethanol fuel is that it can only be used in cars equipped with flexifuel engines, which are still rare in Finland.

“When we started ethanol production in 2007, we made a roadmap of the raw materials base outside the food chain, drew up plans to expand it and set a target for our production. Since then, cellulose-based ethanol has been a key aspect in achieving our production target,” says St1 Biofuels MD Mika Aho.

St1’s goal is to construct a network of bioethanol plants across Finland and achieve a 30- million-litre-a-year capacity in the 2020s. The company was the first in the world to undertake dispersed production of ethanol from waste.

Wood-Based Biodiesel

Finnish company UPM – a famous producer of timber and supplier of wood-constructed housing – is to build a biorefinery and deliver wood-based biodiesel. The biorefinery will produce about 100 000 t of advanced second-generation biodiesel for transport a year.

Construction of the biorefinery began in the summer of 2012 at UPM’s Kaukas mill site and will be completed in 2014. UPM’s total investment will amount to about €150-million.

“The biofuels business has excellent growth potential. The quality of our end-product and its environmental characteristics have gained significant interest among a wide range of customers, and the investment is profitable,” UPM president and CEO Jussi Pesonen.

The demand for biofuels is expected to grow by about 7% a year in the European Union. The bloc’s target is to increase the share of biofuels in transport fuels to 10% by the year 2020.

In Finland, the corresponding target is even more challenging, with an increase of 20%. The yearly production of UPM’s biorefinery will contribute about a fourth of Finland’s biofuel target.