Finland's Chinese-owned synthetic diesel plant

Kaidi's new biorefinery in Finland will cost 1 billion euros and its technology will combine the Fischer-Tropsch process and plasma gasification
By Ron Kotrba | February 24, 2016

In the past week, Wuhan, Hubei, China-based Sunshine Kaidi New Energy Group announced that its subsidiary, Kaidi Finland, plans to build a €1 billion biorefinery in Kemi, Finland.

The plant will produce 150,000 tons of wood-based synthetic diesel and 50,000 tons of biogasoline per year.

Finland already has a novel, wood-based renewable diesel producer with UPM Biofuels, which hydrotreats crude tall oil, a residue of pulp production, in its Lappeenranta plant.

While many news outlets and even Kaidi itself are referring to the Finland-based, Chinese-owned project’s end-product as “biodiesel,” it is not. To those of us who work in this space every day, the term “biodiesel” specifically means fatty acid methyl esters from either the transesterification of glycerides or the esterification of free fatty acids.

Here’s what Kaidi tells me about their process: “Kaidi’s technology will combine the Fischer-Tropsch process and plasma gasification. When the raw material is gasified to 4,000 degrees, one can have a bigger efficiency from the feedstock.”

It is clear to me the product is not “biodiesel” but a synthetic, wood-based diesel, or biomass-to-liquid fuel. Maybe something gets lost in translation. And while I give mass-media reporters a break on knowing the difference, reporters working in this space ought to.

Kaidi, one of the largest bioenergy companies in China, says it will make the final investment decision by the end of this year. The building process could start as early as next year and the plant could be operational by 2019. 

“We find Finland the most interesting country to invest in for biofuels production in the Northern hemisphere,” said Chen Yilong, chairman and CEO of Sunshine Kaidi New Energy Group, in a press release. “Finland has vast biomass resources, plenty of potential partner companies and an extremely progressive biofuels policy.”

The refinery would be located in Ajos, Kemi, according to Kaidi, where Vapo planned to open a biorefinery but withdrew from the project two years ago. Kaidi says it has acquired plans and reports related to the project’s environmental impact assessment approval from Vapo Oy. 

Kaidi also reports it has received an environmental impact assessment approval from the Centre for Economic Development, Transport and the Environment of Lapland, and it says an environmental permit application is underway. In addition, the company has signed a letter of intent to buy 33 hectares of land from the city of Kemi.  

Discussions with subcontractors and other stakeholders are ongoing, according to Kaidi.