Promoting green growth and financing for wood-based bioenergy

Mikael Sjövall, Communications Manager

Nordic Environment Finance Corporation

Joensuu, 17 September 2015

NEFCO in brief

• International financial institution established by the Nordic countries

• Loans and equity investments for environmental projects

• Operating in Eastern Europe, around the Baltic Sea as well as globally – Fund specific mandates

• Funds to a total value of EUR 501 million

• Headquartered in Helsinki with 34 employees

• Locally contracted staff in Russia and Ukraine

Helsinki

Geographic mandate

Gap filler. NEFCO fills financial gaps which are not covered by commercial banks.

Green growth. NEFCO enables exports and sales of Nordic green technology to the neighbouring region.

Cost efficiency. NEFCO spends 1/8 of what it costs to reduce environmentally harmful emissions in the Nordic region.

Our products

• Loans

• Equity investments

• Export financing

• Grants

• Carbon credits

Environmental results

Distribution by country and sector

Our involvement in the forestry sector

• Renewable energy and usage of wood-based biomass

• Investments in the furniture industry

• Heating solutions relying on wood chips or pellets

• Reuse of sawdust for the production of energy

• Feasibility studies and investment plans

• Sustainable management of forests

Climate

Case: Production of bioenergy in Grodno, Belarus

• Rindibel was established in 2008 as a joint venture between Rindi Energi, Volkovysk LesHos, Grodno State Industrial Forestry Association and NEFCO

• HedeDenmark becomes new shareholder in 2012

• The business concept is to turn currently unutilized forestry waste into marketable bio-fuel and to provide modern forestry services to local forestry associations.

Climate

Case: Production of bioenergy in Grodno, Belarus

• Rindibel operates two harvesting lines (harvester - forwarder) and a mobile chipping machine.

• Monthly harvesting volumes 7,500 cubic metres per month

• The company is profitable

• Total initial investment envisaged 1 MEUR

• Part of the biomass is delivered to Poland

Climate

Case: Renewable energy in Archangel, Russia

• Usage of sawdust and bark for energy production

• Customers: the local sawmills

• Prevention of methane emissions

• The heat is used for drying timber and heating the buildings in the area

• Two 2.5 MW boilers consume some 15,000 m3 of bark and 4,800 m3 of sawdust/year

Climate

Case: Cleaner production in the furniture industry

• Client: Rossibalt in Znamensk some 55 km from Kaliningrad

• Replacement of two diesel-fired boilers with a new 32 kW boiler using biomass

• Savings for the company: 1.1 million RUB per year

• Installation of sawdust supply system and silage cutter, new sensors and a chimney

• Reduction of CO2, Nox and Sox

Climate

Case: Fuel switch in Myrne, Ukraine

• Client: Agricultural company Pivdenagropererobka LLC in Myrne, Ukraine

• Replacement of an outdated steam-boiler station with a new unit that will use wood-based pellets instead of fossil fuel

• Reduction of 1,054 tonnes of CO2 per year

• Loan provided from NEFCO's Facility for Cleaner Production

Challenges

• Dependence on oil, coal and gas

• Difficulties related to logging permits

• Dysfunctional wood-based bioenergy markets

• Most of the logging residues and the wood chips are exported

• Lack of bioenergy clusters

• Lack of incentives for investing in renewable energy

The future

• New types of biofuels in the transport industry

• Liquified or torrefied biomass for energy production

• Low hanging fruits in the sawmill industry

• Fuel switches and potential savings

• New scientific data on the environmental impact of incinerating biomass

Mikael Sjövall│ mikael.sjovall@nefco.fi │ +358 50 3535 045

www.nefco.org

twitter.com/NefcoNordic

youtube.com/nefcofinland

Thank you for listening!