Energy Stored in Sand – Polar Night Energy Builds the Future
When Tommi Eronen and Markku Ylönen came up with the idea of storing heat in sand, it initially seemed almost daringly bold. Today, their startup, Polar Night Energy, along with its ongoing development of converting stored heat back into electricity, is moving towards a major energy sector breakthrough with the support of Business Finland.
Based in Tampere, Polar Night Energy Oy has developed a sand-based thermal energy storage system that efficiently stores heat generated from renewable energy while minimizing costs. The system converts electricity into thermal energy, which is then stored within a large mass of sand. Later, the stored heat can be utilized, for instance, in district heating networks, enabling the use of renewable energy even when production and consumption do not align.
Polar Night Energy is currently enhancing its system by adding functionality to convert stored heat back into electricity. This development is supported by Business Finland, which has been backing the company since its early days.
Ensuring Market Demand in Advance
The journey of Polar Night Energy began when Tommi Eronen and Markku Ylönen were inspired by the idea of energy storage. During its early business development, the company received Tempo funding from Business Finland, funding designed to help startups under five years old prepare for international growth. The funding enabled the company to gather feedback from potential customers and assess demand and functionality in international markets.
"Tempo funding was a game-changer for us. It allowed both of us to focus entirely on developing our idea instead of working day jobs. Early-stage support is invaluable – even though we were just two people, the funding enabled us to move forward with full commitment. We are deeply grateful for the support," says Tommi Eronen.
Tuukka Vainio, Business Finland's Key Account Manager for the energy sector, sees great potential in Polar Night Energy’s long-term energy storage solutions:
"Although the market for long-term energy storage is still small, it is expected to grow significantly in the coming decades. Already, there are forecasts that, in 20 years, this market could reach a value of more than 200 billion USD."
"Finland has solid expertise and a nurturing environment for innovation, and startups continue to emerge actively," Vainio notes.
"Operations like Polar Night Energy require ambition and boldness to promote new and disruptive innovations in a conservative industry. The energy market moves relatively slowly, with end customers often being large energy companies that make purchasing decisions cautiously. Moreover, the industry is capital-intensive, and achieving economies of scale requires substantial investment," Vainio explains.
Funding Enables Focused Development
Polar Night Energy has leveraged Business Finland’s support extensively. Internationalization services, including strategy workshops, networks, and leads, have been actively utilized. The company has also benefited from EU funding advice, energy aid, and R&D funding.
"The company used Business Finland’s energy aid to enable its first commercial-scale investment in Pornainen. Through R&D funding, the company has been able to advance its latest ‘Sand to Power’ project, which focuses on producing electricity, in addition to heat, from sand-based storage systems," Vainio shares.
Eronen underscores the critical role of funding in bringing their idea to life: "Funding is key. It has enabled us to accomplish everything needed. The company wouldn’t exist without the support from this kind of funding source."
Scaling Through Innovation
Polar Night Energy is currently developing a new feature for its sand-based thermal energy storage system that enables stored heat to be converted back into electricity. This innovation, known as Power-to-Heat-to-Power, has sparked interest across Europe and among Finnish energy companies. The project is supported by €2.1 million in funding from Business Finland.
"For example, in a large industrial facility that simultaneously uses electricity, heat, and steam, such a solution could entirely replace combustion," says Eronen.
According to Business Finland’s Tuukka Vainio, innovative energy storage solutions are seeing growing international demand.
"Polar Night Energy’s current solution is already scalable for export – particularly to countries with a heating demand. If the company successfully develops technology that cost-efficiently produces electricity from stored heat, its market potential will increase on a whole new scale."
Targeting International Markets
CEO Tommi Eronen, CTO Markku Ylönen, and their roughly 20-member team are now fully focused on advancing the Power-to-Heat-to-Power innovation. The latest funding round allowed the team to expand and provides the foundation for the next phase of development. Business Finland’s funding is crucial in enabling the development of new technology.
“The importance of funding is critical. Without it, for example, district heating operators wouldn’t even consider adopting our technology. New solutions always carry more risks than traditional, familiar ones. Support helps reduce this risk and encourages customers to explore and pilot new innovations,” Tommi Eronen explains.
Tuukka Vainio from Business Finland emphasizes the importance of long-term development: “The energy sector is conservative, and adopting new technologies requires time and resources. Solutions like those from Polar Night Energy need adequate development timelines and funding to evolve from ideas into internationally competitive products.”
Tuukka Vainio actively follows Polar Night Energy’s progress. Business Finland has also played a significant role in supporting the company’s internationalization.
“We’ve been supporting Polar Night Energy from the early stages. In particular, in southern markets where the need for heating diminishes, the ability to generate electricity boosts interest significantly. These kinds of solutions are truly needed as traditional energy sources are being phased out,” Vainio concludes.
The ongoing development project will last approximately two years. Meanwhile, the sales of heating plants will continue at a steady pace.
“We now have the peace of mind to do this work properly. We’re confident everything will go well,” Tommi Eronen says.
Read more about Business Finland Flexible Energy Systems Program