Startups, BigCo And Politics, A Virtuous Cycle?

According to the EU’s climate and energy package, Finland is expected to increase its share of renewable sources from the present 28 per cent to 38 per cent of energy production by 2020. Fulfilling this obligation require a significant increase in Finland’s use of wood-based energy, waste fuels, heat pumps, biogas and wind energy during next years.

This is no easy feat, especially given the rather modest Finnish feed in tariffs in the sector (premium tariffs and investment subsidies amont annually to roughly € 30 million). Nevertheless, the market can be potentially really really big and the need is dire. We’ve already seen some groundbreaking news surface this week in cleantech sector from the US. But make no mistake, Silicon Valley is not the only place where cleantech blossoms. Far from it. This week Wärtsilä came out with news that the world’s first solid oxide fuel cell unit, running on landfill gas, has successfully concluded the first phase of its validation programme.

Wärtsilä is no startup. The company’s core business is marine diesel engines or complete lifecycle power solutions for the marine and energy markets as they like to call them. In 2009, Wärtsilä’s net sales totalled € 5.3 billion with more than 18,000 employees. That’s more red tape anyone ever needs. But just as the Silicon Valley needs googles, ebays and intels, we need our giants to be the ‘universities’ for our entrepreneurs. Without these ‘startup universities’ the future entrepreneurs have no place to learn the tricks of the trade. If we would not have such giants, we would not have jobs to quit. We wouldn’t have the bureaucratic organisations to kill the innovation so we can get frustrated and consequentially unleash the innovation after our 30 day resignation period.

I’m happy we have corporations like Wärtsilä. Now least since they are diversifying also into cleantech. In fact, their power generating unit has been operating for more than 1500 hours producing electricity with extremely low emissions to households in Vaasa, Finland.

The WFC20, which is developed and operated by Wärtsilä, is the first of its kind in the world. The unit is run on methane rich gas, originating from a nearby landfill. Methane is a strong greenhouse gas that would otherwise be harmful to the environment. The WFC20 is based on planar solid oxide fuel cell (SOFC) technology, which is supplied by the Danish company Topsoe Fuel Cell A/S. Wärtsilä is one of the world’s leading companies in the development of fuel cell products based on SOFC technology.

The fuel cell unit has been in successful operation for more than 1500 hours. The demonstrated energy efficiency has reached very high levels, exhaust gas emissions are extremely low, and the unit has been able to operate consistently despite the bio gas having low and fluctuating methane content. The fuel cell unit produces an electric output of approximately 20 kW, which is enough to power approximately 10 households in the area. The thermal output of the unit ranges from 14 to 17 kW.

There is a lot of room for startups and the Nordic BigCo co-operate and deepen the existing co-operation. This can potentially yield massive benefits for the companies themselves as well as the individuals involved when these individuals can easily, on one hand join the giants for 2 to 3 year periods, and on the other hand build companies those giants can acquire. Then repeat the cycle. In fact, such cross-pollination should be extended to government level, where having a political career could add value to being an entrepreneur and building businesses. This should be seen not as a negative development, but a positive one. Hard to imagine? Think people like Steve Westly, former Controller and Chief Fiscal Officer of State of Califormia and now the Managing Partner of The Westly Group.

Old path dependent thinking is dead. So are careers for life. When it comes to changing the world, the playing field includes everything.