Karelia ENPI
CBC Program offers excellent situation for concrete investment projects in
program area. Looking to the program by Finnish side, it also offers good chance
to companies to start business in Russia. It is a safety way because projects
are managed by lead partner and money is protected by program. Companies can be
partners with self-funding part and rest of money comes from EU. In my point of
view companies should look at this like new the export opportunities for their
business. Like in BIOKOS-project, the lead partner is Regional Council of
Kainuu, which means in practice that administrative organization have several
contacts to authorities in Russian side. For companies it is very useful to
create their own contacts with them. In long term the contacts and the
experience that has been got from project can help a lot in export or business
in common.
In BIOKOS
project is target to build 1 MW combined heat and power plant (CHP) in
connection with waste water treatment plant in Kostomuksha. It is a pilot
project because nowhere else exists this kind of technology or exactly saying
these kinds of equipment. Technology is based on thermal drying and thermal
gasification which both are innovations of private Finnish persons. One partner
is responsible to plan the entity. In case the project succeeds this can be
start for new business and co-operation. But the best issue is that sewage sludge
will be handled and modified to energy in Kostomuksha. It is nice to notice
that City of Kostomuksha is very open for new innovations and new
possibilities. Kostomuksha is pioneer and one good reference can open new
cities to partners.
By this
Karelia ENPI CBC Program partners will get more knowledge than one reference.
Export/Import from Finland to Russia is not so simply. Or it is, but it is
important to know what must be done before the equipment transport to Russian
side. Through this project partners will get simply model for export: knowledge
about Technical Requirements of Custom Union, model for custom number that all
equipment can be exported in one entity and a lot of technical papers will be translated
to Russia. This is the case why should be more EU-funding investment and
concrete projects available for small companies. And companies should take to
chance. In Russia is a lot of knowledge in basic industry but also in new
technics. By these EU-funding projects is possible to disseminate knowhow to
each other and networking. Or even to create together something new!
But. There are
always some “buts”. In EU-funding projects budget is very limited and it means
there is no more money than budgeted amount. In pilot projects can be
unexpected costs in installation and in start-up. They can be even 10 % from
total budget. It is really difficult to say how much should be allocate money
for changes. And how much is it even possible inside the project budget? It is
possible try to decrease some costs but how much can decrease for example design
costs in pilot project -case? I would say that nothing. If these kinds of
issues are not taken into account in project applications, it is very
challenging to change budget during the project. There should always be some
risk money behind the project budget or allocates some amount for unexpected
costs. Pilot projects need probably more money for unexpected costs as usual. In
budget can be money for purchasing needed equipment but there is no money to
get process work. Or there is a risk that money finish before plant is totally
running. Project can be an economic risk for all partners. Even in plants which
are be built by well-known technics, there can be unexpected costs in start-up,
too. For example it has been built several nuclear power plants in the world and
technics are known. However Olkiluoto 3 has cost more than expected and project
is late couple of years.
EU-funding project
differs from commercial project. In both cases the owner is known but in
commercial projects there is some guarantee for the plant. After Sales Managers
will make sure everything is working and in some cases maintenance will be
easier. Or service is included into delivery. When EU-funding project ends it
ends because the project can’t take tasks or costs after deadline. Despite of
that it is important to make sure technical support is available for new owner
if necessary. One project challenge can also be that some companies would like
to keep innovations confidential until they have tested it or have ensured it
works in process.
The investment
projects and the concrete building projects are always challenge for managers
and partners. I’m sure all ENPI projects have challenges and own special cases.
Co-operation and understanding are important for all of us. In my opinion it is
important to share experiences to other projects because it can help somebody.
You can follow how BIOKOS goes ahead in our web site www.biokospower.com. I wish to
all other projects good luck and success!
Sanna Nikola-Määttä
KA408: The
Biofuel Plant in Kostomuksha BIOKOS
Project
Manager
Regional
Council of Kainuu
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