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St1 to launch production of ethanol using a technology developed by VTT Technical Research Centre of Finland

24.04.2006

St1 Biofuels Oy, a joint venture of St1 and VTT, is currently preparing to launch its ethanol production, and the plan is to have the first production facilities operating before the end of the year.

The ethanol will be produced using waste from the food processing industry in the place of origin of the waste. The production process, logistics relating to fuel deliveries and the use of ethanol in fuels will help reduce carbon dioxide emissions and environmental loading. At the same time, the process offers a new solution for dealing with waste from the food processing industry and helps to significantly cut down the amount of waste.

“St1’s ethanol production will represent around two percent of the total volume of petrol sold in Finland. Alone, it is enough to meet over half of the goals that the Ministry of Trade and Industry are thinking of setting in relation to the use of biofuel components in Finland,” says Juha Kokko, Managing Director of St1.

The Kyoto Protocol and the European Union’s directives on fuels and waste management compel Finland to take radical measures in order for it to be able to reach the goals. The thinking behind St1’s ethanol production is in line with the environmental objectives and can help to promote the use of renewable forms of energy.

Potential Demand for the Technology Abroad

The ethanol production of St1 Biofuels is based on a process developed by VTT, which makes ethanol production profitable even on a small scale in the place of origin of the waste. At least to begin with, St1 will use the ethanol it produces in the fuels that it sells at its own petrol stations, but expanding production to cater for the international market is a tempting prospect as well.

“The growth projections for the global market prices of ethanol and the costs of waste management make using this unique production concept abroad a tempting prospect. Demand is particularly high in countries where the population and therefore the amount of waste generated is large,” says Antti Pasanen, the developer of the method and Managing Director of St1 Biofuels.


St1 in Brief
St1 is a private Finnish energy company, founded in 1997. The company’s main business is the sale of fuels and it has 307 petrol stations in Finland and Sweden. In 2005, St1’s share of the Finnish petrol market amounted to around 10%. St1 employs 25 people and has a turnover of €370 million, making it the most efficient venture in the industry. The company provides consumers with affordable, high-quality fuels with minimal environmental loading. St1 is a pioneer in applying new technologies in its business. In 2005, the company also began selling electricity to Finnish consumers. For further information, please visit www.st1.fi.

VTT Technical Research Centre of Finland in Brief
VTT Technical Research Centre of Finland is the biggest contract research organisation in Northern Europe. VTT provides high-end technology solutions and innovation services. From its wide knowledge base, VTT can combine different technologies, create new innovations and a substantial range of world class technologies and applied research services thus improving its clients’ competitiveness and technology network, VTT can produce information, upgrade technology knowledge, create business intelligence and value added to its stakeholders. VTT has 2,720 employees and a turnover of 225 €M in 2005.

St1 Biofuels Oy
St1 Biofuels Oy was founded in February 2006 as a joint venture of St1 and VTT. St1 Biofuels focuses on the production of Finnish ethanol which is to be added to fuels. The venture’s owners are St1,VTT , St1 Biofuels Oy’s Managing Director Antti Pasanen and the Chairman of the Board of Directors of St1 Biofuels Oy Mika Anttonen.

Ethanol Production Method at St1 Biofuels Oy
Based on fermentation and the associated evaporation, the homogeneous ethanol production process generates an ethanol/water concentration of 50% at a plant installed in the place of origin of the waste. By-products include water, solid waste and a liquid which can be used in soil conditioning, for example. The ethanol mixture is then transported to St1’s oil terminal in Kotka or Pori, where it will be refined to a purity of 99.8%, mixed into the fuel and distributed to the petrol stations.

The amount of carbon dioxide that is released into the atmosphere during the production process has been minimised by generating the energy needed for running the process using residual heat from industrial installations or renewable sources of energy and, in logistics, by taking advantage of the empty tankers returning after having refilled the petrol stations.

The production method was developed by Antti Pasanen, D.Tech., during his position as a researcher with VTT. In his role as the Managing Director of St1 Biofuels Oy, Mr Pasanen is in charge of commercialising and implementing the method in practice.


Regulations on Waste and Waste Water (inc. 1999/31/EC, Government’s Decision 1049/1999)
The waste and waste water regulations that are gradually taking effect in the EU states compel societies and the industrial sector to reduce the amount of biological loading burdening landfill sites and waste waters and to develop more efficient methods for processing waste, slurry and waste water.

According to the Finnish national strategy on biodegradable waste, only 75% of the amount of biodegradable waste recorded in 1994 can be taken to landfill sites in 2006, and in 2016 the figure is only 35% of the level of 1994. In 2016, no more than 25% of biodegradable communal waste generated in that year can be taken to landfill sites.

The annual costs of managing biodegradable communal waste are expected to increase to about EUR 430-480 million by 2016, in comparison with the current level of around EUR 280 million. The additional costs will be offset with waste management fees imposed on waste producers, and these are expected to increase by over 70%.

Kyoto Protocol
The Kyoto Protocol imposes binding emission reduction requirements on industrialised countries for the years 2008-2012. It compels the countries to cut their greenhouse gas emissions by a total of 5.2% from the level of 1990 between 2008 and 2012. Depending on nation-specific circumstances, countries can strive to meet the reduction requirements by imposing corresponding regulations on the energy and traffic sectors and waste management, for example.

Passed in 1997, the Protocol took effect on 16 February 2005. Finland ratified the Kyoto Protocol along with the other EU member states in 2002.

Directive 2003/30/EC of the European Parliament and of the Council on the promotion of the use of biofuel.
The European Union directive on promoting the use of biofuels and other renewable forms of energy was released in May 2003. The directive aims at increasing energy-related self-sufficiency, reducing dependency on oil and the volume of carbon dioxide emissions, developing agriculture and preserving jobs. According to the directive, the minimum content of biofuels and other renewable fuels in the petrol and diesel used in vehicles must be 5.75% by the end of 2010.

In Finland, the target percentages of biofuel are 1% in 2008, 2% in 2009 and 3% in 2010.

The Commission’s Communication emphasises the goal presented in the Green Paper entitled “Towards a European strategy for the security of energy supply”, according to which 20% of road traffic fuels should be replaced by alternative fuels by 2020.

Facts about Biofuels
Biofuels are liquid or gaseous fuels used in vehicles, made of biomass or, in other words, the products and waste generated in agriculture (including plant- and animal-based materials), forestry and related industries as well as the biodegradable components of industrial and communal waste. Biofuels include bioethanol, biodiesel, biogas, biomethanol, bio-dimethyl ether, bioETBE, bioMTBE, synthetic biofuels, bio-hydrogen and pure plant oil.

Using biofuels helps to reduce the amounts of carbon dioxide that are released into the atmosphere. Their effect is based on the production process and, above all, the raw materials, which while growing absorb carbon dioxide from the atmosphere. Ethanol, for example, can be produced from multiple different raw materials: sugar beet, grains, waste generated by the food processing industry, by-products of the wood processing industry and agricultural and domestic waste. Due to ethanol production not being geographically restricted as fossil fuels are, forwarding distances are shorter. If the ethanol content of a fuel is less than 10%, normal cars can already run on it without needing any modifications.