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Using domestic renewables profitably

Kerava Energy Oy is a role model in the energy sector. In 2009, 75 % of the fuel its power plants used was imported fossil fuel. However, the company decided to do a turnaround, and now 60 % of its fuels are domestic.

According to Customer Relations Director Johanna Haverinen, the decision to change the conventional business model was made because it was sensible. The emission trading system and tax rises for natural gas especially, encouraged the company to consider switching to alternative ways of generating energy.

“We have stabilized the prices and made business profitable by using domestic wood”, says Haverinen.

Implementing the change was not easy however. Using natural gas and wood are two totally different things. It is not possible to adjust a power plant to use another fuel. Kerava Energy built a completely new power plant, which suited its needs better.

The work is still underway. The next project is to add Sipoo to be covered by the renewable heat generation. At the moment Kerava Energy has two district heating networks in Sipoo and they both use natural gas as their fuel. Haverinen says that Kerava Energy has made a decision to build a district-heating pipe from Kerava to Sipoo. The pipe means that the bio power plant in Kerava will havenaccess to one of the natural gas networks in the fall of 2017.

Local energy is appreciated

A complete change in energy generation has brought more value to Kerava Energy’s brand, in addition to better cost-efficiency. Johanna Haverinen says that customers appreciate that the company is local and that the energy has been produced with renewables.

Some clients have not liked wood as a fuel. The problem has not been wood per se, but rather peat that has been used as a fuel together with wood.

Haverinen understands that people are worried about peat’s impact on climate, but notes that it makes sense to use peat together with wood.

”We need sulphur to burn wood, and peat has sulphur. Therefore it is sensible to use peat and wood together. Peat also allows investing in reasonable priced furnaces, which increases the use of wood and therefore decreases the usage of fossil fuels.

Haverinen reminds that not many customers are eager to pay a large premium for climate neutral products. In other words, it is possible to make ideological decisions at a small scale, but in the end business has to be profitable.

“If the business is not durable, it doesn’t exist for long.”