UPM mulls new 500,000mt/yr advanced biofuels refinery in Finland

UPM, an Helsinki-headquartered refiner of advanced biofuels, is exploring whether to build  a possible 500,000 mt/year biorefinery in south-eastern Finland - but is unlikely to take a decision until next year at the earliest.

In a statement this week, the company said it will undertake an environmental impact assessment for the project near the town of Kotka, which is expected to last at least 12 months.

The company added that "EU and national policies on biofuels will also play an important role in the final assessment of the possible investment."

By the end of this year, the EU is expected to finalise the recast of its renewable energy directive for 2021 to 2030 after the Commission, Council and Parliament decide how to cap the use of crop-based biofuels and whether to exclude palm oil as a feedstock from renewable energy targets.

Demand for advanced biofuels, such as wood and crop residues, is expected to surge if the final EU legislation ends up being closer to the positions adopted by the EU Parliament last month, but some in the biofuels industry are sceptical that there will be enough supply.

EU lawmakers have proposed to cap crop-based biofuels use at 2017 levels, and limit the use of total renewables at 12% of total consumption of road fuels, which would ensure that advanced biofuels have a much larger slice of the biofuels pie after 2021.  

Because EU member states have struggled to scale up capacity in so-called second generation biofuels to meet 2020 targets, the biofuels industry is having to consider how it would scale up production in time for the introduction of RED II, sparking a worldwide hunt for suitable feedstocks.      

Feedstocks
UPM's second biorefinery would use a different raw material base and technology than in its the current 100,000-mt Lappeenranta biorefinery, which draws upon waste from the local pulp and paper industry.

The Kotka Biorefinery would produce approximately 500,000 tonnes of advanced biofuels for transportation, made from several feedstocks that fulfill sustainability criteria.

Besides the use of sustainable residues, UPM said it is testing a winter cropping concept with Brassica carinata (a non-edible mustard seed) for biofuels' raw material.

"Oil from turnip rape-related carinata would be one of the possible raw materials for the Kotka Biorefinery," Petri Kukkonen, vice president of UPM Biofuels Development, said in a statement.