Boden Municipality in Sweden has opted for a public-private partnership model to build crucial infrastructure for Boden Industrial Park. Polar Structure will finance and construct the railway, while Solör Bioenergi will take on the process water pipelines. The infrastructure will be key for H2 Green Steel's operations, with construction expected to be mostly completed in 2024, reports Artic Today
Sweden's Boden Municipality has taken a strategic step towards advancing its industrial development. They've decided to use a Public-Private Partnership model to fund and construct necessary infrastructure for the Boden Industrial Park. This move comes to meet the specific timeframe requirements set by H2 Green Steel, a company that heavily relies on this infrastructure.
"We couldn't realistically bear the costs of such substantial investments. But this infrastructure is essential for H2 Green Steel's establishment," says Mats Berg, Head of Business Development in Boden Municipality. To that end, the municipality has reached agreements with Polar Structure to build the railway and Solör Bioenergi for the process water pipelines, without utilizing taxpayer funds.
The project involves significant logistical work. Solör Bioenergi is tasked with building two pumping stations and seven kilometers of piping. This infrastructure will transport water from the Lule River to the industrial park. The estimated construction time spans just over a year, with the majority of work slated for 2024.
Boden Municipality and Solör Bioenergi will form a joint-stock company. Solör will hold the majority share of 91%, while the municipality will own the remaining 9%, valued at around $472,000. Solör will be responsible for financing, building, maintaining, and operating the water pipelines.
Once operational, a fee will be charged to companies using these pipelines. This revenue will go back to the municipality to offset the value of the land used for the infrastructure.
Berg notes that the region is currently highly attractive for investment. "I think we'll definitely use the PPP model more frequently," he says. However, Berg also emphasizes the need for caution, particularly in terms of safety and control over essential infrastructure.
Solör Bioenergi, already a significant player in Scandinavia's renewable energy sector, sees this as a vital step. "We look forward to building and delivering this crucial function. Intensive work will now start to ensure the project is completed on time," says Hans Viken, Sales and Marketing Manager at Solör Bioenergi.
Boden's move to use a PPP model for building crucial infrastructure marks a significant step in its industrial development. It is a calculated risk, mitigating financial strain on the municipality while speeding up much-needed construction. While this strategy might become more commonplace in Boden, it also serves as a blueprint for other municipalities grappling with similar challenges.