Finnish Climate Fund: EUR 6 million capital loan to Lamor Resiclo solving the recycling challenge of plastics
Finding a solution to the plastics challenge is crucial for tackling climate change and transitioning towards a circular economy. The plastics industry and more specifically plastics manufacturing accounts for more than three per cent of global emissions, and the volume of plastic waste has doubled worldwide in the last twenty years. Only one tenth of all plastic waste is currently recycled accordingly.
Lamor Resiclo Oy’s plan is to build a 10,000-tonne plastics recycling facility in Kilpilahti, Porvoo.
‘The Finnish Climate Fund’s investment plays an extremely important role in our investment. Building what will be Finland’s first industrial-scale chemical recycling plant for plastics is a significant step towards a carbon-neutral society. Our objective in Kilpilahti is to test the economic viability of the business model as well as the scalability of the technology. The facility will act as a benchmark for subsequent projects as we build our portfolio of chemical recycling plants both for us as well as our partners’, explains Mika Pirneskoski, CEO of Lamor Corporation and Chairman of the Board of Lamor Resiclo.
The new plant will make it possible to reuse plastics that are incompatible with mechanical recycling processes and therefore difficult to recycle, instead of having to dispose of them by incineration as waste. The plant will produce pyrolysis oil, which can be used as a substitute for crude oil in the production of, for example, plastics and other chemicals, thereby reducing the consumption of virgin feedstocks.
‘Finland is one of the global leaders in producing both bio-based plastic substitutes and a wide range of circular economy solutions that can help to address the plastic waste problem. It’s important for the Finnish Climate Fund to take part in accelerating the deployment of these solutions to solve the plastic challenge, and Lamor Resiclo’s plant in Kilpilahti promises to recover valuable raw materials that are currently wasted’, says Paula Laine, CEO of the Finnish Climate Fund.
More information about the solution
Lamor Corporation, one of the leading providers of environmental solutions, and circular economy specialist Resiclo Oy set up a project company called Lamor Resiclo Oy in 2022.
There are hundreds of different kinds of plastics and not all of them can be recycled in the same way. The primary recycling process is mechanical and involves crushing and melting plastics waste before turning it into pellets that can be reused. Certain types of mixed plastics and thermoplastics, however, are incompatible with mechanical recycling processes and are therefore usually disposed of by incineration. The chemical recycling process makes it possible to break down plastics that are difficult to recycle otherwise and to liquefy them by means of a catalytic reaction.
Lamor Resiclo’s new chemical recycling plant in Kilpilahti, Porvoo uses pyrolysis technology to liquefy plastic waste and turn it into pyrolysis oil. Pyrolysis oil can be used as a substitute for fossil crude oil in the production of new plastics components and chemicals. The resulting products have all the same properties as those made using virgin feedstocks and they are safe to use in demanding applications, such as in the food industry.
The process has an emissions reduction potential of between approximately 1.8 and 2.4 tonnes of CO2 equivalent per one tonne of plastics feedstock. The annual emissions reduction rate at the Kilpilahti plant’s design capacity is currently estimated at 19,000 tonnes of CO2-eq on average and the plant’s cumulative ten-year emissions reduction potential is estimated at approximately 0.2 million tonnes of CO2-eq. Most of the reductions will contribute for the Effort Sharing sector. The Kilpilahti facility serves as a reference for Lamor, whose broader goal is to create a project portfolio of 100,000 tons by the end of 2025. This would also increase the total emissions reduction potential considerably.
Chemical recycling is considered consistent with the EU taxonomy for sustainable investment activities if mechanical recycling is not a technologically and economically feasible option. The waste fed into Lamor Resiclo’s process cannot be recycled mechanically.
The company has raised a total of approximately EUR 16 million in funding, consisting of the EUR 6 million capital loan from the Finnish Climate Fund and a EUR 2.7 million grant from Business Finland’s NextGeneration EU funding as well as other loans and equity. The EUR 6 million capital loan granted by the Climate Fund is priced at market terms and includes an interest rate premium.
Lamor is one of the leading global providers of environmental solutions. Lamor provides its customers with versatile environmental protection and material recycling solutions and services, such as clean-up and preparedness services related to oil spill response and environmental incidents, services for the treatment of waste, recycling of plastics, and tailored and adapted soil and water treatment solutions. Lamor operates together with its local partners, offering a wide selection of solutions, which can be tailored according to the needs of each customer, and aiming to clean the world, for which the company has worked since its incorporation. The company's share is listed on the Nasdaq First North Premier Growth Market Finland marketplace maintained by Nasdaq Helsinki under the trading code LAMOR. Further information: www.lamor.com
Saara MatteroCommunications and Sustainability DirectorThe Finnish Climate FundTel:+358 400 114 777Saara.Mattero@ilmastorahasto.fi
Mika PirneskoskiCEOLamor Corporation OyjTel:+email@example.com
About Ilmastorahasto Oy
The Finnish Climate Fund is a Finnish state-owned special-assignment company. Its operations focus on combating climate change, boosting low-carbon industry and promoting digitalisation. The Climate Fund invests in large-scale projects in which the fund’s investment is crucial to enable the project’s realisation in the first place, on a larger scale or earlier than it would with funding from elsewhere.
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