Eco-innovationinFinland

EIOCountryProfile

2014-2015

Eco-InnovationObservatory

TheEco-InnovationObservatoryfunctionsasaplatformforthestructuredcollectionandanalysis

ofanextensiverangeofeco-innovationinformation,gatheredfromacrosstheEuropeanUnionandkeyeconomic regionsaround theglobe,providingamuch-needed integrated informationsourceoneco-innovationforcompaniesandinnovationserviceproviders,aswellasprovidingasoliddecision-makingbasisforpolicydevelopment.

TheObservatoryapproacheseco-innovationasapersuasivephenomenonpresentinalleconomicsectorsandthereforerelevantforalltypesofinnovation,definingeco-innovationas:

“Eco-innovation isany innovationthatreducestheuseofnaturalresourcesanddecreasesthereleaseofharmfulsubstancesacrossthewholelife-cycle”.

Tofindoutmore,visitwww.eco-innovation.euandec.europa.eu/environment/ecoap

Any views or opinions expressed in this report are solely those of the authors and do notnecessarilyreflectthepositionoftheEuropeanCommission.

Eco-InnovationObservatoryCountryProfile2014-2015:Finland

Author:JesseLastunen

Coordinatoroftheworkpackage:TechnopolisGroupBelgium

Acknowledgments

This document has been preparedwith the kind support of representatives from the FinnishInnovationFund(Sitra),theFinnishFundingAgencyforTechnologyandInnovation(Tekes),theMinistryofEmploymentandtheEconomyaswellastheMinistryoftheEnvironmentofFinland.

AnotetoReaders

Any views or opinions expressed in this report are solely those of the authors and do notnecessarilyreflectthepositionoftheEuropeanUnion.Anumberofcompaniesarepresentedasillustrativeexamplesofeco-innovationinthisreport.TheEIOdoesnotendorsethesecompaniesandisnotanexhaustivesourceofinformationoninnovationatthecompanylevel.

This brief is available for downloaded fromhttps://ec.europa.eu/environment/ecoap/finland

Tableofcontents

Introduction................................................................................................................2

1 |Eco-innovationperformance...............................................................................3

2 |Selectedcirculareconomyandeco-innovationareasandnewtrends.................5

3 |Barriersanddriverstocirculareconomyandeco-innovationinFinland..............8

4 |Policylandscape:towardscirculareconomyinFinland......................................10

ANNEX: Policy measures addressing circular economy and eco-innovations inFinland ...................................................................................................................18

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Summary

Incomparisontopreviousyears,theeco-innovationlandscapeinFinlandremainsquitestable.Importantly,Finlandisstillrankedasoneofthemostinnovativecountriesintheworld(Duttaetal.,2015;Ezelletal.,2016).Finnisheco-innovationcontinuestobenefitfromawell-developedinnovation system, open economy, and close collaboration between industry, academia andnationalresearchorganisations.

It isalsonoteworthythatenergyefficiencyandcirculareconomyhavebeenestablishedaskeyhigh-levelpolicypriorities,andrelatednationalandregionalinitiativesaremanifold.Bothstart-upsandestablishedcompaniesgeneratetechnologies,productsandservicesinseveralsectorsrelevant to eco-innovations and the circular economy. Applications range from amobile appdesignedtorescueleftoverfoodfromrestaurantstopioneeringenergymanagementsolutionsandtransformativeproductsbasedonmaterialrecycling.

Themain challenges for eco-innovation in the country are associatedwith theweak nationaleconomyanddecreasingpublicandprivateresearchanddevelopment(R&D)spending.Finlandisalsofacingminorproblemsinimprovingenergyefficiency,partlyduetoitssubstantialrelianceonnatural resources,aswellas inachieving its targets to reducegasemissions in thecomingdecades.

One of themost important high-level steps towards a circular economy in the country is theinclusionofcirculareconomyasakeypolicypriorityintheStrategicProgrammeoftheFinnishGovernmentfrom2016onwards.Inadditiontopublicfunding,thischoicesignalsbroadpoliticalsupportformakingtheeconomyandindustrymorecircularinthelongerterm.

TheFinnishMinistryofEmploymentandtheEconomyalsopublishedtheStrategytoPromoteCleantech Business in Finland in 2014, which continues to guide policymaking and businessinitiatives. Additional strategies and programmes relevant to eco-innovations and the circulareconomy include the Finnish Bioeconomy Strategy (2014), the Finnish Material EfficiencyProgramme (2014), and the new Circular Economy focus area (2016) in Sitra, the FinnishInnovationFund.

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Introduction

TheFinnisheconomyisstillrelativelyweakin2015.RealGDPremainsbelowthelevelachievedbeforethestartofthecrisis,thedeclineoftheconventionalelectronicsandpaperindustrieshasresultedinadropinoverallproductivity,andtheproblemswithcostcompetitivenesshavenotfully disappeared. The state of the labour market has also continued to worsen, andunemploymentremainshigh(ECa,2016).Theseeconomy-wideproblemsmayposechallengesforeco-innovationsandthebuild-upofacirculareconomy,especiallyastheyseemtobereflectedinlowerresearchanddevelopment(R&D)spending.Asopposedtopreviousyears,however,theambitionofenvironmentalpolicygoals–supportedbyinitiativesandtargetssetbytheEuropeanUnion–hasnotsufferedsubstantiallyfromtheadverseeconomicsituation.

There are also several challenges particularly pertinent to eco-innovation. First, the Finnisheconomystill reliesheavilyonnatural resourcessuchaswood,water, soilandminerals,allofwhichareusedinFinlandmorethaninEuropeonaverage(ForumforEnvironmentalInformation,2015).Theabundanceofresource-intensiveindustries–forinstancewood-basedbioenergy,pulpproductionandmining–alsomeansthatimprovingresourceefficiencyontheaggregatewillbechallenginginthecomingyears(YM,2014).

Atthesametime,thelargeshareofextractiveindustriesandtherelatedproblemsinresourceefficiency create substantial potential for major benefits from eco-innovations and businesssolutionsthatmovetowardsacirculareconomy.

Second,Finlandhasbeenstrugglinginthematerialrecoveryofconstructionanddemolitionwasteaswellasinrecyclingmunicipalwaste.RelatedtargetssetbytheEuropeanUnionwillbedifficultto fulfil (YM, 2014). Again it is noteworthy that several new companies have tackled thesechallenges,andtheyarealsobeingaddressedbynationalandregionalpolicymakers.

Third,achievinggreenhousegas(GHG)emissiontargetsisamajorchallengeforthecountry.Per-capitaGHGemissionsinFinlandareabovetheEUaverage.Themainproblemsseemtobefocusedon the non-emission trading sectors such transport, the heating of buildings, and agriculture.Relatedly, a key future challenge to achieving carbon-neutrality is to prevent the loss ofbiodiversity,especiallywhentheuseofforestsandothernaturalresourcesisexpectedtoincreaseinthenearterm(ForumforEnvironmentalInformation,2015).

AnotherexpectedproblemcomesinmeetingtheemissionceilingforammoniaemissionsbasedontheEU’sNationalEmissionCeilingsdirective.ItisnoteworthythatthechallengesofammoniaandgreenhousegasemissionsaswellasresourceefficiencyhavebeenprevalentinFinlandforseveralyears;GHGemissionsandresourceefficiencyarealsowidelydiscussed inthepreviousreportfrom2013.

Despite thebroaderproblemspresent in theFinnisheconomyand the specificenvironmentalchallenges, the state of the environment in Finland is good and gradually improving (see e.g.Environment.fi,2016).Moreover,severalpolicyinitiativesbothatthenationalandregionallevelhavebeentakenupinrecentyearstoreduceenvironmentalcostswhileattemptingtoimprovetheeconomy.Perhapsmostimportantly,circulareconomywasselectedasoneofthekeyprojectsintheStrategicProgrammeoftheFinnishGovernmentfor2016onwards(GovernmentofFinland,2015).

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1 |Eco-innovationperformance

TheanalysisinthissectionisbasedontheEU-28Eco-innovationscoreboard(Eco-IS)fortheyear2015.ViaitscompositeEco-innovationindex,producedbytheEco-InnovationObservatory(EIO),Eco-ISdemonstratestheeco-innovationperformanceofacountrycomparedwiththeEUaverageandwiththeEUtopperformers.Eco-ISisbasedon16indicators,aggregatedintofivecomponents:eco-innovationinputs,activitiesandoutputs,environmentalandsocio-economicoutcomes.

Figure1EU-28Eco-innovationScoreboard2015,compositeindex

Source:EIO,2016

Finland continues to demonstrate high performance in terms of eco-innovation. As in 2013,FinlandisagainrankedsecondintheEU-28Eco-ISin2015,withanoverallscorethatexceedstheEUaverageby40%.In2014,Finlandwasfourthintheranking.Nationalexpertsagreewiththedepictionintheindexofparticularlyhigheco-innovationperformance.Similarly,asintheoverallscore,Finland’strackrecordintermsofdifferentEco-IScomponentshasbeenlargelyconsistentsince2011,withparticularstrengthsandweaknesses.

Asin2013,Finlandstandsoutwithitshighscoreoneco-innovationinputs.Thescoreis82%higherthan the EU average. Out of the specific input indicators, the value of green early-stageinvestments(US$170,orapproximately€150,percapita)isovertwiceashighastheEUaverage.FinlandalsoexceedstheEUaveragebyaround70%intheGDPshareofpublicenvironmentalandenergyR&DoutlaysandintheshareofR&Dpersonnelandresearchersoutoftotalemployment(2.1%).

Eco-innovation outputs also stand out. For instance, Finland has 2.3 times as many eco-innovation-relatedpatentsadjustedtopopulationperyearastheEUaverage,and2.8timesas

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manypublicationsrelatedtoeco-innovation.Theoveralloutputscorehasincreasedremarkablyfromaround150%tonearly200%oftheEUaveragefrom2013to2015.Thesuccessinbothinputandoutputmeasurescanbepartlyattributedtothecollaborativenetworksbetweenindustry,academia and thepublic sector in the country, aswell as substantive public andprivateR&Dfundinginthepastdecades.

Finland’sperformanceineco-innovationactivitiesandsocioeconomicoutcomesisalsoaboveEUaverage. In termsof the specificmeasures for the former,17%ofall Finnish firms implementinnovationactivitiesaimingatimprovingenergyintensity.17%ofcompaniesalsoseektoreduceoverallmaterial input through innovation. These shares are 60%and73%higher than the EUaverage,respectively.Outofthesocioeconomicoutcomes,theshareofexportsofproductsfromeco-industries,0.7%,isaveragefortheEU,whiletheemploymentshareforeco-industries(4.6%)andturnoversharefromeco-industries(2.6%)are43%and17%higherthantheaverage.

Similarly to previous years, the resource efficiency component of the eco-innovation score isaround20%lowerthantheEUaverage.Themainchallengesareinmaterialproductivity(57%lower than the average) and energy productivity (41% lower). Interestingly, the share ofrenewableenergyintotalenergyconsumptioninFinlandisrelativelylarge.However,becauseasignificantandagrowingproportionof thisenergy iswood-basedbioenergy,morerenewableenergyinthecountryshowsnegativelyinindicatorsforresourceefficiency.Otherindustriesthatconsume large amounts of natural resources include pulp production andmining, which hasgrowninrecentyears.Anotherfactorthatpushesdownresourceefficiencyisrelativelylateandcontinuingurbanisation.Finlandalsoemitsaround14%moregreenhousegasesthananaverageEUcountry,correctedforGDP,althoughthegaphasnarrowedslightlyfrom2013.

Figure2Componentsoftheeco-innovationcompositeindexforFinland2015

Despite the challenges in resource efficiency and GHG emissions, overall Finland remains aforerunnerineco-innovationperformance,andanexampleofsmartplanningandorganisationofthenationaleco-innovationsystem.

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2 |Selectedcirculareconomyandeco-innovationareasandnewtrends

CleantechremainsoneofFinland’sfastestgrowingbusinesssectors. Itemploysaround50,000people, and 40,000 new jobs are expected by 2020. The government also aims to raise theturnover of Finnish cleantech companies to €50 billion by 2020 (Cleantech Finland, 2016).Importantly,Finnishcleantechstart-ups receivedaround€50millionor20%ofall foreignanddomesticequityinvestmentsinFinnishstart-upsin2015(Taloussanomat,2016).

Therecenttrendsincleantechinthecountry,especiallywhenconsideringeco-innovationsandthecirculareconomy,canbedivided intoseveralkeyareas.They includeenergymanagementproducts and services, renewable energy production technologies, recycled products andmaterials, waste management services (including ”waste to value”), and circular economyapplicationsinagricultureandforestry(seeLahti-Nuuttila,2016andHaaranen,2015).ThemoretraditionalstrengthsinFinnishcleantechremaininindustrialprocesses–e.g.energy,materialsandwaterefficiency–aswellasbioenergyandbio-basedproducts(TEM,2014a).

Furthermore, several Finnish companies are known for their ability to integrate differenttechnologies into functional and holistic solutions, for optimising electricity networks ormonitoring industrial processes, for instance. The solutions generally rely on smart, software-basedplatforms.

Considering different areas: first, an increasing number of Finnish companies specialise inconsulting and advisory services related to energy efficiency, which has traditionally been animportant area within the national cleantech scene. As an interesting example, LeaseGreenconsults for clients in the property sector with the main purpose of improving their energyefficiency. Itprovidesservicesrangingfromsurveysofpropertiesandprojectplanningtocost-benefitanalysisandmonitoring.

Morestart-ups focussolelyonenergy-efficientproducts.Valtavalo, for instance, improves thecost-efficiencyofitscustomersbyprovidingenergy-efficientlightingsolutions.Otherfirmsrelyonopportunitiesgeneratedbyallthingsdigital:AlfacLeanwindowscommunicatewitheachotherwirelessly,improvingenergyefficiencyinrenovationprojectsinparticular,andFourdegoffersapatented,optimisation-basedsolutionforimprovedenergyefficiencyinresidentialbuildings.

Second, the recent trend towards more sustainable energy production solutions is bestrepresentedbySavosolar,aFinnishcompanythatmanufacturestheworld'smostefficientsolarthermal collectors.Renewableenergyhas longbeenakeypolicypriority for thecountry, andassociatedwithanincreasingnumberoffirms.InadditiontoSavosloar,otherexamplesincludeNaps Systems Oy (photovoltaic systems), Beneq Oy (photovoltaic modules and equipment),SolecoLtd(photovoltaicconsulting)andVTEKEnergyAb(windturbinesystems).

ThepublicityandnewgovernmentpriorityforacirculareconomyisalsodirectlyvisibleinFinnishstart-ups.Asanexample,DestamaticOyproducescompositeproductsforconstructionthataremadeentirely fromrecycledmaterials.Mostof thecompany’sproductsarealsocreatedwithfundingfromtheGreenGrowthprogrammeoftheFinnishFundingAgencyforTechnologyandInnovation,Tekes.

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ResQClubreliesonanintuitivemobileappthroughwhichusersbuyfoodthatisabouttogotowastefromlocalrestaurants.Somewhatrelatedly,physicalwastecollectionisalsoanemergingareaofFinnisheco-innovation:anEspoo-basedcompanyEcovoclaimstoberevolutionisingthewayinwhichwasteiscollectedfrompublicareas.Itreliesondatafromsensorstoalertauthoritiesaboutoverflowingrubbishbinsandrecyclingcontainers(EC,2016b).

Finally,Haaranen(2015)discussestheeconomicpossibilitiesofcirculareconomyforFinlandinthecontextsofnutrientrecyclinginagricultureandcirculareconomyinforestry.Consideringthelatter,theeconomicpotentialofcirculareconomyinthepulpandpaperindustryinthecountryisestimatedtobeintherangeof€220-240million.Thepaperindustryhassubstantialmaterialflowsandhighenergyintensity,andsmallimprovementsinefficiencyorintherecoveryanduseofby-productsgenerallyleadtoconsiderablesavings.

FourgoodpracticeexamplesofFinnishcompaniesandproductsrelatedtothecirculareconomyandeco-innovationarepresentedinmoredetailbelow.

ResQClub

ResQClubisastart-upwithamissiontohelppeoplerescuequalityfoodfromgoingtowaste.Relyingonanintuitivemobileapp,usersreceivenotificationsdirectlyfromlocalrestaurantsthathavefoodthatisabouttogotowaste.Theycanbuyselectedfooddirectlyintheappandpickitupatachosentime–withanaffordablepricetag.Whileservinghigh-qualityfoodtopeopleinthecity,thepopularservicealsooffersrestaurantsaconvenientopportunitytosellleftoverfoodastake-awaymeals,andtopotentiallyacquirenewcustomersintheprocess.TheserviceiscurrentlyworkinginHelsinki,TurkuandJyväskylä,butexpandingrapidly.

ResQisaformofnewsocialentrepreneurshipwherebusinessapproachesareusedtoidentifysolutionstosocial,culturalandinthiscaseenvironmentalproblems.ResQisagreatexampleof small-scale eco-innovation based on ICT, intuition and the emerging environmentalconscienceamongthegeneralpublic.

- Keywords: Eco-innovation, food, waste,mobile,app

-Website:https://resq.club

- Contact:TuureParkkinen,+358505318115,tuure@resq.fi

Source:https://resq.club/

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Savosolar

SavosolarisaFinnishcompanythatmanufacturesthemostefficientsolarthermalcollectorsintheworld.Thecompany'sproductsarebasedonavacuumcoatingprocesswherethecompleteabsorberstructureiscoatedafterassembly.Thismeansthatthedirectflowdesign,withhighlyimprovedheattransfer,canbeused.

ThecompanyisbasedinFinland,Denmark,GermanyandItaly,andexpandingrapidly,withthefundamental mission of accelerating the solar economy through leading technology forcompetitiveenergy.Withthispurpose,Savosolarseekstosupport itscustomers inreachingtheirenvironmentalandbusinesstargetsbysignificantlyreducingtheirenergycosts.

- Keywords:renewableenergy,solarpower,solarthermalcollectors,vacuumcoating

- Website:http://www.savosolar.fi/

- Contact:+358102710810,info@savosolar.fi

Source:http://www.savosolar.fi/

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3 |Barriersanddriverstocirculareconomyandeco-innovationinFinland

The 2014 Research and Innovation Country Report for Finland by the European Commission(Saarivaara,2015)providesinsightsintothegeneralbarriersanddriverstoeco-innovationinthecountry. Asmentioned, one of the key challenges relates to the economic environment. TherecessionandtheproblemsintheICTsectorhaveledamongotherthingstoasteepdeclineinboth public and private research and development investments. Government R&D fundingdecreasedby13%inreal termsbetween2010and2014,andgrossdomesticexpenditures forR&Ddeclinedsharply.Anotherhigh-levelchallengefortheFinnishinnovationsystemis its lowlevelofinternationalisation,aswellasarelativelyfragmenteduniversitysystem.

Despitetheproblems,Finlandstilloutperformsitspeerswhenitcomestohighlyskilledhumanresources,publicandbusinessinvestmentsinR&Dandpatentapplications.Themainhigh-leveldriverofeco-innovationstemsfromthefactthatFinlandstillranksamongtheworld’sbestinR&Dintensity,andperformswellintermsofscientificandtechnologicalexcellence:theInformationTechnologyandInnovationFoundation(ITIF)rankedFinlandfirstinhowitspoliciescontributetoanddetractfromglobalinnovationsystem(Ezelletal.,2016).

Morespecificallytoeco-innovation,Finlandhasseveralhot-spotclustersintechnologicalareassuch asmaterials, energy, and agriculture. Finland also ranked second in the 2014 CleantechInnovationrankingbyWWF,whichcomparedcountriesbasedontheirconditionsforestablishingcleantechnologystart-upsandfacilitatingthedevelopmentofenvironmentaltechnologies(YM,2014&CleantechGroup,2014).Moregenerally,Finlandhasanewgenerationofyoungpeopleandstudentsthathaveinrecentyearshelpedcreateabroadecosystemofstart-upsandventurecapitalinvestors,manyofthemfocusingonfieldsrelatedtocirculareconomyandeco-innovation.Slush – a non-profit event organised annually in Helsinki by a community of entrepreneurs,investorsandstudents–isaprominentexample.

According to Riina Antikainen (2015) from the Finnish Environmental Institute, while there issubstantialandincreasingdemandforeco-innovations,itisoftendifficultforFinnishcompaniestoaccessinternationalmarkets.Inparticular,start-upsandsmallandmedium-sizedenterprises(SMEs) face problems in commercialising their new products and services internationally.Networks aremissing or limited, and financingmight not always readily available. As for thecustomers, the long-term benefits from eco-friendly products may be difficult to recognise,meaning that customers are not committed to pay an additionalmargin for environmentallyfriendly products. In general, the payback period for eco-innovations is long, and returns oninvestmentuncertain(EC,2016c).

The Finnish Innovation Fund Sitra’s 2015 report ‘The opportunities of a circular economy forFinland’discussestheeconomicpotentialofthecirculareconomyforthecountry,alsomappingout tangible business opportunities. Sitra estimates that circular economy represents anopportunity worth around €1.5-2.5 billion for Finland (Haaranen, 2015; Sitra, 2015). Somecompanieswillbenefitindirectlyfromefficientuseofmaterialflowswhileotherswillbeabletosell products and services based on new businessmodels that take advantage of the circulareconomy.Thekeysector-specificopportunitiesdiscussedinSitra’sconcernpaperindustryside

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streams; the opportunities in the food industry to reduce loss of value; business potential ofprivateconsumption;andopportunitiesinconstructionandmanufactureofmachinery.

Theforestry-woodvaluechaininFinlandhastwokeyareasofinterestforthecirculareconomy:recoveryofpaperfibreforreuseaccountsforamajorshareoftotalmaterialflow,andmostwoodwasteinFinlandendsupasanenergysource.Fromthecirculareconomyperspective,thebestopportunitieslieinimprovingthecirculationofpaperfibresandtheuseofsidestreams.

Thefoodvaluechain,fromagriculturetoretailandrestaurantservices,alsoincludestwofactorscrucial to circular economy:howwell theoriginal rawmaterial is used, and theway inwhichnutrients are reintroduced into the nutrient cycle. Potential high-level actions include theminimisationoffoodwastegeneratedbyhouseholdsandhospitalityservices,aswellascapturingthemaximalvalueofinediblefoodwasteinsteadofincineratingit.Finland’sfoodchainisindeedideallyplacedtofosterthecirculareconomyatthelocallevel.

Sitra(2015)alsodiscussesthreedimensionsofhouseholdconsumptionthatareofinterestfromtheperspectiveofthecirculareconomy:theopportunitiesstemmingfromthesharingeconomy,second-handmarkets and the recyclingofhouseholdwaste.As for the latter, amajorpartofmaterialflowsinFinlandandelsewhereisduetoprivateconsumption,andpost-consumerwasteisgenerallysenttolandfillsunsorted.AccordingtotheMinisteroftheEnvironment(YM,2014),recyclinginFinlandcouldbeincreased,especiallyinpackagingwasteandbiowaste.AdditionalEUmeasureswouldalsohelptospeedupprogressatthenationallevel.

InadditiontoSitra’sdetailedreport,circulareconomywasalsoselectedasoneofthekeyprojectsofPrimeMinisterJuhaSipilä’s2015governmentprogramme,withaplannedpublicinvestmentof €40 million. Related initiatives, also supported by Sitra, include trial projects that aim tofacilitatethebuildingofconcretebusinessmodelsaswellasthesharingofbestpracticesinthecountry.Thefunctioningandfeasibilitytestsofdifferentbusinessmodelsarecurrentlyunderwayinthetextileindustry,nutrientcycling,cities,andtechnologyandexportcompanies.

Together with new actions from the European Union, the funding environment and thegovernment’spreparednesstosupportcirculareconomyinFinlandindeedseempromising.ItisalsonotablethatNordiccooperationisemergingbasedonthecirculareconomyphilosophy:theaimofthenewEkokemconsortiumformedbymajorplayersfromDenmark,FinlandandSwedenis to increase the reuse and recycling of resources in the Nordic region by specialising andexploitingsynergiesacrosssectors(Kiorboe&Milios,2015).

Specificsectoralchallengesandbarriersarealsonumerous.Forinstance,thetargetssetoutintheEUWasteFrameworkDirectivefortherecyclingofmunicipalwaste(50%by2020)aswellasformaterialrecoveryofconstructionanddemolitionwaste(70%in2020)willbechallengingforthe country (YM, 2014). According to a recently published comparison of municipal wasterecyclingrates,FinlandisbarelyattheaveragelevelamongEUmemberstates.Conflictsandlackofdialoguebetweendifferentstakeholdersinthewastesectorarepartlytoblamefortheslowprogress in municipal waste recycling. Producer responsibility schemes, of which there arepositive examples in improving recycling of waste paper and tires, might also improve therecyclingofmunicipalwaste.

Asimpliedearlier,resourceefficiencyingeneralisanotherchallengeforFinland,especiallyduetothehighnumberofresource-intensiveindustriesintheeconomy.Severalmeasurestoimproveresourceefficiencyhavebeenoutlinedat thenational level, for instance intheworkinggroupproposalforaNationalmaterialefficiencyprogram,preparedincollaborationwiththeMinistryofEmploymentandEconomyandtheMinistryoftheEnvironment(TEM,2014b).

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4 |Policylandscape:towardscirculareconomyinFinland

At thehighest level, the Finnish innovation systemhas remainedquite stable in recent years.Recent changes include a new funding model for the national universities (with a focus oncompetitiveelementsoffunding),theestablishmentoftheCouncilforStrategicResearch,andrelated reforms regarding research funding, open data initiatives, and a new programme forstructuralfunds.Thesechangesarenotexpectedtohavemajorimplicationsoneco-innovationorthecirculareconomyinthecountry.

Environmental taxation isoneof themore importantpartsof the relatedpolicy landscape. In2014,Finland’srevenuefromenvironmentaltaxation,2.9%ofgrossdomesticproduct,wasabovethe EU average of 2.5%. The share of environmental taxes in tax revenues has also graduallyincreased, while the composition has changed: taxes on carbon dioxide from heating, powerplantsandmachineryaswellasthewastetaxhaveallbeengraduallyincreased.Suchchangesmayreflectmarginalimprovementsinincentivesforeco-innovationinthecountry.

Someenvironmental taxes arebeing reduced.As an importantexample, effectiveasof 2017,Finlandwillreintroducetaxrefundsfortheminingindustry.Whiletheannualvehicletaxhasbeenincreased,cartaxationiscurrentlybeingreduced.Accordingtosomeestimates,inordertomeetenvironmentaltargets,afurtherreviewofenvironmentallyharmfulsubsidiesmaybeneeded:thereducedratesonspecificindustrialactivitiesandfuelsamountedto€3billionin2014(EC,2016a).

Finlandalsoexperimentedwitha temporaryR&D tax relief in2013–15,offeringanadditional100%deductionforR&Dpersonnelwages,setagainstcorporatetax.TheeligibleR&Dwasdefinedasbasic,industrialandexperimentalresearchactivities.AccordingtotheResearchInstituteoftheFinnish Economy (ETLA, 2016), the tax break did not achieve its goals, especially since thecompaniesthatbenefittedfromthepolicywereonaverageolder,moreprofitableandlargerthanthosewhodidnotrelyonorbenefitfromit.

Intermsofbroadnationalpolicygoalsandprioritiesrelevanttoeco-innovationandthecirculareconomy, Finland seeks to diversify its energy supply, reduce the dependency on importedenergy,increasetheshareofrenewableenergyandimproveenergyefficiency.Finnishexcellenceincleantechnologyisalsoarelatedpolicypriority(EC,2016a):thecountry’sobjectivesincludecreating40,000new jobs incleantech in thecomingyearsanddouble the turnoverofFinnishcleantechbusinesses.

Carbon-neutrality isbothanationalandregional targetunderlyingotherenvironmentalgoals.Despitedifficultiesmentionedearlier,FinlandisstilljustontracktoreachitsEurope2020targetstoreducenationalgreenhousegasemissions.Whenitcomestoregionalinitiatives,anumberofmunicipalities have committed to a timetable faster thannational goals for achieving carbon-neutrality. As an example, there are currently 19municipalities that have joined the TowardsCarbon Neutral Municipalities (HINKU) project, and made a commitment of 80% emissionreductionby2030.

Further,asdescribedbySaarnivaara(2015),theInnovativeCities(INKA)Programmefor2014–2020 encourages urban areas in Finland to choose strategic focus areas and generate an

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environmentforcompetence-drivenbusiness.Theprogrammerequires12largecitiestomakechoices in accordance with the EU’s Smart Specialisation Strategies. At least two of the fivethemeschosenforthestartoftheINKAProgrammearerelatedtoeco-innovation:abio-basedeconomyforJoensuuandsustainableenergysolutionsforVaasa.Tampere’stheme,relatedly,issmartcityandreformingtheindustry.TheprogrammeisunderthemanagementofTekes.INKAisalsosupportingtheSmartChemistryParkinTurku,discussedinmoredetailbelowwithothergoodpracticesofpolicymeasuresincirculareconomyandeco-innovation.

Next,TekeshassetupaSmartProcurementprogrammefor2013–2016withthefocusoncreatingsmartdemand,whichwillprovide theprerequisites fornewmarket creationandgrowth.Themainfocusareasfortheprogrammeinclude,amongothers,energyandenvironment.RelatedTekesprojects,from2013orbefore,continuinguntilatleast2015,includethefollowing:

• WittyCity2013–2017,whichaims to facilitatebetter livingandworkingenvironmentsandnewopportunitiesforbusinessesforcommercialisingproductsandservices

• Arctic Seas 2013–2017, which aims to turn Finland into an internationally attractiveconcentrationofArcticknowhow

• EVE,ElectricVehicleSystems2011–2015,whichaimstocreateaFinnishcommunityofelectricvehicleandsupportsystemdevelopers

• GreenGrowth,TowardsaSustainableFuture2011–2015,whichaimstoidentifypotentialgrowthareasforthesustainableeconomybusiness

• GreenMining 2011–2016,which seeks tomake Finland a global leader of sustainablemineralindustryby2020

• BrandnewprogrammesundertheSmartandGreenGrowth(Bioeconomy) focusarea,introduced in 2016, include Clean Soil, CleanWeb, and BioNets. These programmesrevolvebroadlyaroundcleantech,bioeconomy,andgreengrowth.

Itisalsonoteworthythatin2014theFinnishMinistryoftheEmploymentandEconomy(2015)orderedanationalstrategyfordevelopingthebioeconomyinFinland.ItwasdraftedbyseveralMinistries,publicorganisationsandrelevantstakeholdersrepresentingthesector.Thestrategystartsoffwiththepropositionthatasustainablebioeconomyplaysakeyrole inthecourseofFinlandfora low-carbonandresource-efficientsociety.Themainobjective istohelpgenerateneweconomicgrowthandjobsfromanincreaseinthebioeconomybusinessaswellasfromhighadded value products and services –while securing the operating conditions for the nature’secosystems.Thestrategysetsseveralstrategicgoals:1)acompetitiveoperatingenvironmentforthebioeconomy;2)newbusiness from thebioeconomy;3)a strongbioeconomycompetencebase;and4)accessibilityandsustainabilityofbiomasses.ThegoalofthestrategyistopushtheFinnishbioeconomyoutputupto€100billionby2025andtocreate100,000newjobs.ArelatednewTekesprogrammePuhtaastiBiotalouteenhelpscompaniesaccessinternationalmarketswithbio-basedproducts(Tekes,2016b).

In early 2016, Tekes launched the Challenge Finland competition in the search for new,commercialisablesolutionsformajorproblems,includingthoserelatedtocleantechnologies.Theaimofthecompetition istoeffectivelycombinetopFinnishresearchwithprivatesectorR&D,bringingFinlandnewexportproductsandservices(Tekes,2016a).

The Strategic Programmeof the FinnishGovernment2016–2018 includes the followingbroadobjectivesfortheyear2020:

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• ”Finlandhasachievedthe2020climateobjectivesalreadyduringthegovernmentterm.Importedfossil fuel-basedenergyhasbeenreplacedbycleanandrenewabledomesticenergy.”

• ”The growth of cleantech enterprises, the increase in the sustainable use of naturalresources, pluriactive rural enterprises and an efficient circular economy havecontributedtothecreationofnewjobs.”

Bioeconomy, clean technologies and eco-innovations in general are among the five strategicprioritiestosupporttheseobjectives,with€300millionoffundingintotal.Fivekeyprojectareasarespecified:

1. Towardscarbon-free,cleanandrenewableenergycost-effectively

2. Woodonthemoveandnewproductsfromforests

3. Breakthroughofacirculareconomy,restoringwaterstogoodcondition

4. Finnishfoodproductiontobeprofitable,tradebalanceontherise

5. Naturepolicybasedontrustandfairmeans.

The main efforts regarding the first project area include increasing the share of renewabletransportfuels,andsupporting large-scalepilotprojects inthecleantechsector,togetherwithinnovative renewable energy investments more generally. One of the efforts focuses onintroducingacompensationsystemfor the indirect impactsofemissions tradingonelectricityprices. Furthermore, according to the programme, coal will no longer be used in energyproductionandtheuseofimportedoilfordomesticneedswillbecutinhalfduringthe2020s.

ThesecondkeyprojectisbasedonthebroadobjectiveofdiversifyingtheuseofwoodinFinland.TheexpertspointouttotherelatedgoalofrefiningthenationalBioeconomyStrategy,especiallyinthesenseofdeepeningthecollaborationbetweenpublicfundingagenciesandimprovingthecoordinationofdifferentfundinginstruments.

As mentioned, €40million are directed to circular economy (Sitra, 2015 and Government ofFinland,2015).TherelatedactionsaretargetedatimprovementoftheecologicalconditionoftheBalticSea,thereductionofthenutrientloadinwaterwaysmoregenerally,enhancingthenutrientandenergyself-sufficiencyofagriculture,andthegrowthofcirculareconomybusinesses–manyoftherecommendationsdiscussedearlierbySitra(2015).TheEuropeanUnionhasalsopreparedanew,ambitiousCircularEconomyPackagethatseekstofacilitatechangesinthissphere.

Asforconcreteactions,therepresentativesoftheFinnishGovernmentpointtopilotprojectsandinnovative public procurement. In 2016, Tekes and Finnverawill be launching a collaborativefundingprogrammetargetedtowardspilotanddemonstrationprojectsthatfocusoncleantech,bioeconomy and digital solutions. Relatedly, theMinistry of the Economy and Employment isfundingprogrammescalled ‘Greenproductsof theEU–DevelopmentofCommunication’and‘IndustrialSymbiosis–Implementinganationaloperationmodel’.

Lastly, it is noteworthy that the strategic cleantech programme launched in 2012 by PrimeMinister Jyrki Katainen’s government is still in operation. The long-term objective of theprogrammeisforFinlandtobecomeaglobalsuperpowerincleantechby2020.

13

TowardsCarbonNeutralMunicipalitiesproject

Anongoingexampleofasuccessfulactiontowardsconcreteimprovementsineco-innovationistheTowardsCarbonNeutralMunicipalities(HINKU)project.Theprojectbringsmunicipalities,businesses, citizens and experts together to create and carry out solutions to reducegreenhousegasemissions.ThemunicipalitiesinvolvedarecommittedtoreduceGHGemissionsmoreextensivelyandrapidlythanEUtargetswouldrequire:fiveFinnishmunicipalitiesinitiallycommittedtoan80%reductioningreenhousegasemissionsfromthelevelof2007by2030,andthenumberhasincreasedafter.

Theprojectaimstocreatesolutionsthathavedirecteconomicandsocialbenefitsaswellasenvironmental advantages. Specific solutions relate to transportation, housing and food.Recently,theFinnishEnvironmentInstituteSYKElaunchedajointprocurementofsolarpower systems, inviting all municipalitiesand municipal enterprises in Finland toincreasetheiruseofsolarpower.Thesolarpowerstationsaretobeleased,asaresultof which municipalities do not need toinvest in the plants themselves or accrueadditional operating costs. The jointprocurement process was developed aspart of the Carbon Neutral Municipalitiesproject.

• Keywords:Carbon-neutrality,municipalities,transportation,housing,solarpower

• Website:http://www.hinku-foorumi.fi/en-US

• Contact:DirectorDrJyriSeppälä,+358295251629,jyri.seppala@ymparisto.fi

Source:http://www.hinku-foorumi.fi/en-US

14

Start-upandCo-creationCommunitiesasEcosystemsforEco-innovations(SCINNO)

ScinnoisacollaborativeprojectbytheAaltoCentreforEntrepreneurship(ACE),AltoNovaOy,The Tyndall Centre, University of East Anglia, the International Institute for IndustrialEnvironmental Economics (IIIEE) and University of Lund. It is conducted in 2014–2016 andfinancedbyTekes,SYKEandAaltoUniversity.

Theprojectisbasedontheideathat,althougheco-innovationsplayacrucialroleinachievinggreengrowth,lessattentionhasbeendevotedtotheactorsininnovationnetworks.Themainfocusoftheprojectistosupportthetransitiontoagreeneconomybyexaminingthecreationand diffusion of eco-innovations in business ecosystems, with special focus on growthentrepreneurship and emerging ecosystems. The objective is to identify success factors forconstructingandmanagingeco-innovationecosystemsindifferentcircumstances(orstagesofdevelopment)inordertoimprovethecompetitivenessofFinnishcompanies.Inparticular,thepurposeistoexaminetheemergenceofco-creationandtoidentifyprocessesandtoolsthatencourageco-creation.

• Keywords:Eco-innovations,greengrowth,ecosystems,communities,networks

• Website:http://www.syke.fi/hankkeet/SCINNO

• Contact:ResearchCoordinatorRiinaAntikainen,+358400148671,riina.antikainen@ymparisto.fi

GlobalCleantechSummitinHelsinki,2015

TheGlobalCleantechSummit is aplatform for corporatedirectors,policymakers, investors,researchers and other stakeholders to discuss the opportunities provided by cleantechsolutions.Thefirstthree-daysummitwasheldinHelsinkiinSeptember2015.Thesummitwasopened by Olli Rehn, the Minister of Economic Affairs. Around 250 stakeholders from 25differentcountriesparticipated.

Thekeythemesincludedvaluechains,businessco-operation,industrialtransformationandkeyenabling technologies. The participants shared cleantech success stories from around theglobe.Thelastdayofthesummitfocusedonthechallengesandopportunitiesinthemineralssector, with special attention given to issues relevant in the Arctic and Barents Region.Furthermore,conferenceguestswereofferedachancetolearnhowcleantechnologyhasbeenimplementedinFinlandthroughcompanyvisits.

• Keywords:cleantech,summit,conference,circulareconomy

• Website:http://www.globalcleantechsummit.fi/

15

SmartChemistryParkTurku

SmartChemistryParkinTurkuisaregionalinitiative,enabledbythecitiesofTurkuandRaisio,theEuropeanRegionalDevelopmentFund,theFinnishFundingAgencyforInnovation,Tekes,and the Finnish Innovation Fund, Sitra. Smart Chemistry Park offers facilities and businessgrowthopportunitiesforcompaniesinTurku,andhasbeenrecognisedasasuccessfulnetworkforenablinggrowththroughcollaborationandpublicsupport.

Manyofthecompanieslocatedattheparkandsupportedbytheinitiativearecommittedtodevelopingeco-innovations.BLN-Woods, for instance, is thedeveloperofarguably thebestbiomassfractionationtechnologyintheworld.Inaddition,CrisolteQismovingintobecominga major industrial operator within the Finnish circular economy; it is a multi-substancereclamationservicecompanythatusesvaluableingredientsfromlateralflowsfrom,primarily,themetallurgicalandchemicalindustriesandrecoverstheseintovalueaddedproducts.

• Keywords:Eco-innovations,circulareconomy,networks,biomass,chemistry

• Website:http://smartchemistrypark.com/en/

• Contact:BusinessDevelopmentManagerLindaFröberg-Niemi,+358505873441,linda.froberg-niemi@turkusciencepark.com

Source:http://smartchemistrypark.com/smart-chemistry-park-grand-opening-8-5-2015/

16

ReferencesAntikainen,R.,2015,Ekoinnovaatioillenostettamonipuolisistaverkostoista,Tekesblog.Availableathttp://www.tekes.fi/nyt/blogit-2015/ekoinnovaatioille-nostetta-monipuolisista-verkostoista/

CleantechFinland,2016,What’sCleantechFinland?Availableathttp://www.cleantechfinland.com/en/web/cleantech/what-s-cleantech-finland

CleantechGroup,2014,GlobalCleantechInnovationIndex(GCII)Report.WWFInternational.Availableathttp://www.cleantech.com/indexes/the-global-cleantech-innovation-index/2014-report/

DestamaticOy,2014,Destamaticpresentsthenextgenerationofrecycledcompositeproductsforconstruction,pressreleaseAvailableathttp://www.destamatic.fi/files/DM_Destaclean_pressrelease_Oct2014.pdf

Dutta,S.,Lanvin,B.&Wunsch-Vincent,S.(2015).TheGlobalInnovationIndex2015:EffectiveInnovationPoliciesforDevelopment.CornellUniversity,INSEAD,Wipo,ConfederationofIndianIndustry,dU,ATKearney.Availableathttps://www.globalinnovationindex.org/userfiles/file/reportpdf/gii-full-report-2015-v6.pdf

Environment.fi,2016,Ympäristöntilanindikaattorit.JointwebsiteofFinland’senvironmentaladministration.Availableathttp://www.ymparisto.fi/fi-FI/Kartat_ja_tilastot/Ympariston_tilan_indikaattorit

ETLA,2016,T&k-toiminnanverotukieisaavuttanutasetettujatavoitteita,11.3.2016.Availableathttp://www.etla.fi/uutiset/tk-toiminnan-verotuki-ei-saavuttanut-asetettuja-tavoitteita/

EuropeanCommission(EC),2014,StudyonR&DTaxIncentivesAnnex:Countryfiches.FinalReport,Taxud/2013/315.Availableathttp://ec.europa.eu/DocsRoom/documents/8033/attachments/1/translations/en/renditions/native

EuropeanCommission(EC),2016a.CountryReportFinland2016,EuropeanCommission,Brussels.Availableathttp://ec.europa.eu/europe2020/pdf/csr2016/cr2016_finland_en.pdf

EuropeanCommission(EC),2016b,InnovativeFinnsfindcashinwastemanagement.EC,Eco-innovationinpractice.Availableathttp://ec.europa.eu/environment/ecoap/about-eco-innovation/business-fundings/innovative-finns-find-cash-waste-management_en

EuropeanCommission(EC),2016c,Europarametersurveys.Availableathttp://ec.europa.eu/public_opinion/index_en.htm

Ezell,S.,Nager,A.&Atkinson,R.D.,2016,ContributorsandDetractors:RankingCountries’ImpactonGlobalInnovation,InformationTechnologyandInnovationFoundationReport,January.Availableathttps://itif.org/publications/2016/01/20/contributors-and-detractors-ranking-countries’-impact-global-innovation

FinnishEnvironmentInstitute(SYKE),2016,SCINNOprojectwebpage.Availableathttp://www.syke.fi/hankkeet/SCINNO

FinnishMinistryofEmploymentandtheEconomy(TEM),2014a,GovernmentStrategytoPromoteCleantechBusinessinFinland.Availableathttps://www.tem.fi/files/40668/Government_Strategy_to_Promote_Cleantech_Business_in_Finland.pdf

17

FinnishMinistryofEmploymentandtheEconomy(TEM),2014b,Sustainablegrowththroughmaterialefficiency.PublicationsoftheMinistryofEmploymentandtheEconomy,8/2014.Availableathttps://www.tem.fi/files/38764/TEMjul_8_2014_web_27022014.pdf

FinnishMinistryofEmploymentandtheEconomy(TEM),2015,TheFinnishBioeconomyStrategy.Availableathttps://www.tem.fi/files/40366/The_Finnish_Bioeconomy_Strategy.pdf

ForumforEnvironmentalInformation,2015,TheStateoftheEuropeanEnvironment:ChallengesandopportunitiesforFinlandSpeechesfromtheEventsoftheForumforEnvironmentallnformationseries5/15.Availableathttp://www.ymparistotiedonfoorumi.fi/wordpress/wp-content/uploads/2015/02/puheenvuoroja-5-englanniksi.pdf

GovernmentofFinland,2015,Finland,alandofsolutions:StrategicProgrammeofthePrimeMinisterSipilä’sGovernment,29May2015,GovernmentPublications12/2015.Availableathttp://valtioneuvosto.fi/documents/10184/1427398/Ratkaisujen+Suomi_EN_YHDISTETTY_netti.pdf/8d2e1a66-e24a-4073-8303-ee3127fbfcac

Haaranen,2015,TheCircularEconomyinAgricultureandForestryinFinland,28.10.2015EIP-AGRIWorkshopOpportunitiesforAgricultureandForestryintheCircularEconomy.Availableathttps://ec.europa.eu/eip/agriculture/sites/agri-eip/files/field_event_attachments/ws-circulareconomy-20151028-pres01-tarja_haaranen.pdf

Kiorboe,N.&Milios,L.,2015,CirculareconomyandbioeconomyintheNordicregion.Availableathttp://www.norden.org/fi/ajankohtaista/artikkelit/circular-economy-and-bioeconomy-in-the-nordic-region

Lahti-Nuuttila,T.,2016,Palveluistaapuailmastonmuutoksenhillintään.TekesBlog.Availableathttp://www.tekes.fi/nyt/blogit-2016/teija-lahti-nuuttila-palveluista-apua-ilmastonmuutoksen-hillintaan/

ResQ,2016,Companywebpage.Availableathttps://resq.club/

Saarnivaara,V-P.,2015,RIOCountryReportFinland2014,ECJRCScienceandPolicyReport.

Savo-Solar,2016,Companywebpage:Availableathttp://www.savosolar.fi/en/

Sitra,2015.TheopportunitiesofacirculareconomyforFinland,SitraStudies100.Availableathttps://www.sitra.fi/julkaisut/Selvityksi%C3%A4-sarja/Selvityksia100.pdf

SmartChemistryPark,2016,Projectwebpage.Availableathttp://smartchemistrypark.com/en/

Taloussanomat,2016,Somalaisiinstartupeihinsijoitettiinviimevuonna253miljoonaaeuroa.Lähessatamiljoonaaeuroatuliulkomaisinasuorinasijoituksina.March21,2016.Availableathttp://www.taloussanomat.fi/yritykset/2016/03/21/startupeille-ennatysmaara-rahaa-nama-alat-kerasivat-eniten-sijoituksia/20163153/12

Tekes,2016a,ChallengeFinlandcompetitionpressrelease.Availableathttps://www.tekes.fi/en/whats-going-on/news-2016/challenge-finland-competition-for-top-researchers-and-companies-gets-under-way/

Tekes,2016b,Puhtaastibiotalouteenprogrammefrontpage.Availableathttp://www.tekes.fi/ohjelmat-ja-palvelut/ohjelmat-ja-verkostot/puhtaasti-biotalouteen/

ThereCorporation,2016,Companywebpage.Availableatwww.therecorporation.com

YM,2014,MinisteroftheEnvironmentofFinlandVilleNiinistö,closingspeechatCommissionerfortheEnvironmentJanezPotocnik’sseminaratAaltoUniversity,11April2014,inHelsinki,Finland.Availableathttp://www.ym.fi/fi-FI/Ajankohtaista/Minister_of_the_Environment_of_Finland_V(29027

18

ANNEX:Policymeasuresaddressingcirculareconomyandeco-innovationsinFinland

Groupofpolicymeasures Typeofpolicymeasure

Specificmeasure

Focusofpolicymeasure

Circulareconomy

Genericfocusoneco-

innovation

Resourceefficiencyimproveme

nt

Energyefficiencyimprovement

Reductionof

emissionsincl.CO2

Otherrelevantareas(e.g.renewableenergy,etc.)

SUPP

LYSIDEFO

CUS

Equity/businesssupport

Publiclyco-fundedventurecapitalfunds

-Thestate-ownedfinancingcompanyFinnveraistheofficialexportcreditagencyforFinland.Itoffersloans,creditsandguaranteesforcompanies,includingforeco-innovationandrelatedinvestments.

X X X X X X

-FinnishIndustryInvestment(FII)isagovernment-ownedventurecapitalandprivateequitycompany,withafocusoncleantechandmining.

X X X X

-TheFinnishFundforIndustrialCooperationLtd.(Finnfund)isaFinnishdevelopmentfinancecompanythatprovideslong-termriskcapitalforprivateprojectsindevelopingcountries,includingenvironmentalprojects.

X

Publicguaranteefunds

-Amongothermeasures,Finnveraoffersanenvironmentalguarantee,asecurityforloanstakenoutforenvironmentalprotectionandenergyinvestments.TheguaranteecanbegrantedforacreditusedtofinanceseveraltypesofmandatoryandvoluntaryenvironmentalandenergyinvestmentsinFinland,essentiallyallfocusareasspecifiedontheright.

X X X X X X

-TheFinnishFundingAgencyforTechnologyandInnovation,Tekes,combinesdirectfundingwithguaranteedloans,especiallyinR&D. X

SupportforR&Dinpublicsectorandindustry

R&Dfunding

-Tekesgrantsfundingandsubsidiesforthedevelopmentofproducts,servicesandprocessesthatareinaccordancewithsustainabledevelopmentingeneral.Tekesfundingspecificallyconcernsinnovation–transformingresearch-stageideas(alsothosefromuniversitiesandresearchinstitutes)intoviablebusinesses.-Tekeshasfundedorco-fundedmanyinnovationsintheirearlystagesthathaveendedupimportantenvironmentalproductsandservices.CleantechandbioeconomyarementionedbyTekesasthecountry’sstrengthsthatalsoaffectfuturefundinginbroadterms.Energyefficiencyandenvironmentalbenefitsarehighlightedinfundingcriteria.

X X X X X X

19

-AcademyofFinlandisagovernmentalfundingbodyforscientificresearch.TheAcademyhasfundedseveralprojectsandresearchersontopicsrelatedenergyandtheenvironment.

-Ongoingresearchfundingprogrammesrelevantforeco-innovationsandthecirculareconomyincludeArcticAcademyProgramme,ARKTIKO(2014–2018),MineralResourcesandMaterialSubstitution,MISU(2014–2019),NewEnergy(2014–2018),ProgrammableMaterials,OMA(2012–2016),SustainableGovernanceofAquaticResources,AKVA(2012–2016),SyntheticBiology,FinSynBio(2013–2017).TheAcademyisalsopreparingaprogrammeinbioeconomy(BioFuture2025).

X X X

Collaborativegrants

-Tekesadministersfundingprogrammesthatfundcollaborativeprojectsbetweencompanies,universitiesandotherresearchinstitutions,someofwhicharerelatedtoeco-innovationandcirculareconomy.PreviousprogrammesincludeClimBus(BusinessOpportunitiesintheMitigationofClimateChange,2004–08),Groove(GrowthfromRenewables,2010–14),Biorefine(2007–12),andGreenGrowth(2011–15).

Severalgrantprogrammesarestillongoingafter2015:InnovativeCities(2014–17)WittyCity(2013–17),GreenMining(2011–16)andArticSeas(2014–17).Brandnewprogrammesintroducedin2016includeCleanSoil,CleanWeb,andBioNets,whichrevolvebroadlyaroundcleantech,bioeconomy,andgreengrowth.

X X X X X X

-Relatedly,aidforcompanies’jointexportpromotionprojectsisgrantedbytheEnterpriseandInnovationDepartmentoftheMinistryofEmploymentandtheEconomy,andtheCentreforEconomicDevelopment,TransportandtheEnvironmentforPirkanmaa.

X(nospecificfocus)

R&Dinfrastructure

-MinistryofEnvironmentandMinistryofTransportandCommunications(high-levelinitiativesandstrategies;fundingadministrationforagencies)

X X X X X X

-SectoralresearchinstitutessuchastheTechnicalResearchCentreofFinland(VTT),theFinnishEnvironmentInstitute(SYKE),anduniversitiesanduniversitiesofappliedsciences.

X X X X X X

Fiscalmeasures

TaxincentivesforR&Dandstart-ups–andpublic

fundingspecificallyforstart-ups

-Governmentalstart-upgrant(notspecificallyatax-basedincentive)fornewentrepreneurs:thegrantprovidesanentrepreneurwithasecureincomewhenbuildingupbusinessup–butfornomorethan18months.TheCentreforEconomicDevelopment,TransportandtheEnvironment(ELYs)alsoprovidesdevelopmentgrantsandconsulting.

X(nospecificfocus)

-TekeshasaYoungInnovativeCompanyfundingprogramme(YIC),whichprovidesfundingforinnovativenewcompaniesforcomprehensivedevelopmentoftheirbusinessactivities.Theaimistosubstantiallyacceleratetheglobalgrowthofthemostpromisingsmallcompanies.Oneofthefivemaingroupsoffundedcompaniesincludescleantech,energyandindustrialservicesfirms.

X X

20

TaxincentivesforR&Dpersonnel

-In2013-15,FinlandexperimentedwithatemporaryR&Dtaxreliefwherethegovernmentofferedanadditional100%deductionforR&Dpersonnelwagesagainstcorporatetax.Thepolicywasdiscontinued.

X(nospecificfocus)

Education,trainingandmobility

Tailoredtrainingcoursesforcompanies,entrepreneurs

-Severalprivatecompanies,municipalpublicagenciesanduniversitiesprovidespecifictrainingcoursesrelatedtoenergyandtheenvironment. X X X

Advice/consultingforstart-ups,companies,entrepreneurs

-TheGovernment’sEmploymentOffices(TE)providetrainingintendedforthoseplanningtostartabusiness.Flexiblecombinationsofstart-upgrantsandentrepreneurtrainingarealsoavailable.TheTEOfficeorganisesfreetrainingfornewentrepreneurs,suchaslabour-markettraining.ConsultingisalsoprovidedbyELYCentresandmanyeducationalinstitutions.

-InformationaboutpublicbusinessservicescanbefoundonasinglewebsiteintheMyEnterpriseFinlandservice.-Tekesalsoprovidesseveralbroadadvisoryservicestostart-ups.

X(nospecificfocus)

-IntheKutteriprogramme,theMinistryoftheEnvironment,togetherwithseveralassociationsanduniversitiesofappliedsciences,formanadvisorynetworkonbioenergyinthecountry.

-FinLTSER,theLong-TermSocio-EcologicalResearchnetworkisanationalnetworkfocusedonresearchandbusinessaroundecology,includingsectoralnationalresourcecentres,municipalities,andbusinesses.

-Eneuvonta.finetworkprovidesenergyadviceservicesnationallybutismostlyfocusedonenergyconsumers.Bioenergianeuvoja.fiisasimilarservicemostlyforconsumers.

X X X X

-InvestinFinlandhelpstopromotedifferentindustriesandtechnologies,includingcleantechservicesandtrade(e.g.Cleantech).

X X X X X X

-Finnishmunicipalitiesarealsoactivelysupportingstart-ups.Asanexample,HelsinkiHUBsupportscompaniesseekinggrowthinHelsinkiarea,ThinkCompanyandAaltoUniversityStartUpSaunaareprominentexamplesofincubationservicesfornewideas.

-Regionaldevelopmentcompaniesworkincloseoperationwithgovernmentalorganisationsandlocalcompaniestofacilitategrowthandnewsustainablebusinesses.

X X X X X X

Placementschemesforstudents

-Educationrelatedtoenvironmentaltechnologies,renewableenergyandseveralfieldsrelatedtoeco-innovationsandcirculareconomyisofferedbyFinnishuniversitiesanduniversitiesofappliedsciences.

X X X X X X

21

SupportforR&Dworkersrecruitments

None

Networksandpartnerships

Competencecentres,clusters,science-technology

parks

-SeveralpubliclyfundedStrategicCentresforScience,TechnologyandInnovation(SHOKs)arefocusedoneco-innovations.FundingforSHOKshasbeencutdownrecentlybuttheyremaininoperationrelyingsolelymarket-basedfunding.

X X X X X X

-TheResearchandInnovationCounciladvisestheGovernmentanditsMinistriesinimportantmattersconcerningresearch,technology,innovationandtheirutilisationandevaluation.

-Businessincubatorsprovideaffordableworkingspace,training,mentoring,matchmakingandotherusefulservicesforthevibrantFinnishstart-upecosystem.Probablythebest-knownincubatorofthe14incubatorsinFinlandisStart-upSauna.

X(nospecificfocus)

-Severalbusinessparksandclustersaccommodatecompaniesfocusingoneco-innovationsandthecirculareconomy,includingtheLahtiRegionDevelopmentLADECLtd(previouslyLahtiScienceandBusinessPark)andSmartChemistryParkinTurku.

X X X X X X

-SYKE,TheFinnishEnvironmentInstitute,providesservices,publicationsandtrainingforresearchers,experts,decision-makersandcompanies.Theproficiencytestsforlaboratories,forexample,arewidelyusedbylaboratoriesfromaroundtheworld.

X X X X X

-VaasaRegionDevelopmentCompanyVASEKpromotesregionalbusinessandhelpsSMES.Ithasastrongfocusonrenewableenergy.

X X X X

Technologyplatformsandinnovationnetworks

-CleantechFinlandisanetworkoftopFinnishcleantechcompaniesandexperts.Itsobjectiveistobringtogetherrelevantactorstosolveproblemsrelatedtotheenergyandtheenvironment;andtoconnectpotentialinvestorsandpartnerswiththebestcleantechexpertsinthemarket.

X X X X X

-GreenNetFinlandisacleantechbusinessnetworkthatbringstogethertheexpertiseandresourcesofFinnishcleantechcompanies,scientificandeducationalinstitutionsandpublicauthorities.Thethematicfocusincleantechisurbancleantech,comprising:smartandenergyefficientconstructionandliving,andcirculareconomyintheurbanenvironment.

X X X X X X

-Circulareconomyandcarbon-neutralindustryfocusareasandrelatedforums,platforms,experimentsandinitiativesbytheFinnishInnovationFund,Sitra.

-Biotalous.fiisawebpagebythreeministriesaimedatboostingandinformingonbioeconomy.OneoftheactionsstatedintheStrategicprogramoftheGovernmentof2015isthecreationofdemonstration

X X

22

areasforbioandcleansolutions.Thereareseveralongoingprojects.ThelargestincludetheMetropolSmartandCleanFoundationfocusingonHelsinki.

-ThenewEkokemconsortiumformedbymajorplayersfromDenmark,FinlandandSwedenistoincreasethere-useandrecyclingofresourcesintheNordicregionbyspecialisingandexploitingsynergiesacrosssectors.

-RelevantTekesfundingprogrammesincludeBusinessOpportunitiesintheMitigationofClimateChange,GrowthfromRenewables,GreenGrowth,InnovativeCities,WittyCity,GreenMining,andArcticSeas.

X X X X X X

-TherearealsoseveralrelevantAcademyofFinlandprogrammessuchastheforthcomingBioFuture2025focusedonresearcharoundbioeconomy.

X X X

Foresightandcommonvisionbuilding

-TheMinistryoftheEnvironmentgeneratesbroadgeneralstrategiesbasedonGovernmentstrategiesandprogrammes.TheFinnishMinistryofEmploymentandtheEconomyispreparinganewenergyandclimatestrategywithafocusonenergyindependencyandcarbon-neutrality.

X X X X X X

-TheNationalForesightNetworkisanetworkofFinnishorganisationsthatconductsregularforesightwork.TheaimistoraiseawarenessofFinland’snewchallengesandopportunitiessotheycanbediscussed,studied,andconsideredindecision-making.ThePrimeMinister’sOfficeandSitra,theFinnishInnovationFund,coordinatethenationalforesightnetworkandsupportforesightactivitiesandnetworkinginFinland.

-TheGovernmentForesightGroupappointedbythePrimeMinister’sOfficeon21January2015isresponsibleforleadingandcoordinatingnationalforesighteffortsandformakingthisoperationvisible.

-Finpro,TekesandSitraalsoengageincommonvisionbuilding.

X(nospecificfocus)

Marketintelligenceandotherformsofinformation

sharing

-Otherthanthosementionedabovein‘Advice/consultingforstart-ups,companies,entrepreneurs’,largelyprivateconsultingandITcompanies. X X

DEMAN

DSIDE

FOCU

S

Regulationsandstandards

Regulations,targets,cap&tradeschemes

-Wastelegislation:includesgeneralwastelegislation,end-of-waste,wastetreatmentandrecovery,legislationonspecifictypesofwastes,productsandactivities,wasteshipments,WasteOilChargeActandTowardsarecyclingsociety–Nationalwasteplanuntil2016;

X X X X

-EnvironmentalprotectionAct:alsoregulateswaste;

-Gettingmoreandbetterfromless:ProposalsforFinland’snationalprogrammetopromotesustainableconsumptionandproduction(2005);

-Taxesrelatedtonaturalresourceuse;

X X

-Lawonpromotionofbiofuelsintransport; X X X X

-Energyandeco-efficiencystandardsfornewbuildings; X X X

23

-Emissiontaxesandcharges(waste,oilrelease,airtrafficnoise; X X

-Userchargesforpollutioncontrolservices,pollutionbasedproductchargesandtaxes; X X X

-Taxesandchargesonenergyandtransport;Administrativecharges(permit,registrations,licenses);thereallocationofEnvironmentallyHarmfulSubsidies(2013);

-TheFinnishGovernmentaimstodirect5%ofallpublicprocurementon”innovativeprocurement”,includingproductsandservicesrelatedtoeco-innovationandcirculareconomy.

X X X X X

Performancestandards,labelling,certification

-Electricitymeteringobligation(2009):smartelectricitymetersutilisedineveryhouseholdinFinland;

-Energyefficiencylabelscheme(2010):inaccordancewiththeEcodesignDirective.

X X X

“Green“publicprocurementofgoodsandservices

-Acquisitionlaw:energyefficiencyrequirementsinpublicinvestment,whichalsoregulatecompetitionconcerningacquisitionsinaccordancewithsustainabledevelopmentrelatedtoenergyandtheenvironment.

X X X X

-MotivaLtd:Equipmentprocurements,EnergyprocurementsandMaterialefficiency;ResolutiononSustainablepublicprocurement(2009).

X X X X

R&Dprocurement-Tekes,procurementforthepreparatoryworkofinnovativepublicprocurement. X X X X X

Pre-commercialprocurement

None

TechnologyTransfer

Advisorysupportfortechnologyadopters

-Anenvironmentalguideforpublicprocurement;HYMONET,adatabaseforenvironmentallyfriendlyproducts; X

-EnergyOffices:independentactor,assistlocalfirmsandcommunitiesandhelpplanandrealisetheirenergyprojects;

X X X

-CentresforEconomicDevelopment,TransportandtheEnvironment(ELY)areresponsiblefortheregionalimplementationanddevelopmenttasksofthecentralgovernment.TheyprovideTekesservicestoregions;

-Globallyrecognisedprivateconsultingcompanies.

X X X X X X

Financialorfiscalsupportfortechnologyadopters

(e.g.grantsforpurchasingnewtechnology)

-Tekes,MinistryofEmploymentandEconomy,MinistryoftheEnvironmentgrantenergysubsidiestoenterprises,municipalitiesandothercommunitiesforclimateandeco-friendlyprojectsenhancingtheuseofrenewableenergies,energysavings,energyproductionortheintensificationofitsuse,reducingenvironmentalhazardscausedbytheproductionoruseofelectricity;

X X X X

24

-Finnveragrantsenvironmentloansforinvestmentsthatpreservetheenvironment(energyefficiency,materialefficiency,emissions,water,etc.) X X X X X

Supportofprivatedemand

Taxincentivesforconsumers(e.g.forpurchasing

environmentallyefficientproducts)

-Lawonproducttaxes:taxincentiveforrecyclablepackingperproductunit. X

Taxreductionsforproductsandservices(e.g.VAT

reductions)

None

Demandsubsidies(e.g.eco-vouchers,consumer

subsidies)

-Repairandenergysubsidiesforimprovingtheenergyefficiencyofbuildingsandfortheutilisationofrenewableenergysources X X X

Awarenessraisingandinformationprovision

-MotivaLtd.:advisingandinformingconsumers,industryandthepublicsectoraboutissuesrelatedtothesustainableuseofenergyandmaterials

X X X X X

-Consumeroffice:consumereducationrelatedtosustainabledevelopment X X X X X

-TheFinnishInnovationFund,Sitra,promotespublicdiscussionandinformsconsumersaboutthecarbon-neutralcirculareconomy.

X X X X X X

AbouttheEco-InnovationObservatory(EIO)

TheEco-InnovationObservatory(EIO)istheinitiativefinancedbytheEuropeanCommission’sDirectorate-GeneralfortheEnvironment.TheObservatoryisdevelopinganintegratedinformationsourceandaseriesofanalysesoneco-innovationtrendsandmarkets,targetingbusiness,innovationserviceproviders,policymakersaswellasresearchersandanalysts.

VisitEIOandDGENVEco-innovationActionPlan(EcoAP)websiteandregistertogetaccesstomoreinformationandtoaccessallEIOreports,briefsanddatabases.

www.eco-innovation.euec.europa.eu/environment/ecoap