Dutch-origin company Power2X plans to invest over a billion euros to build a 500,000-ton annual capacity methanol plant in the Niidu industrial area in Pärnu. The production will rely on sustainably sourced forestry by-products and flexible green hydrogen generated from Estonia’s future offshore wind energy areas.
Power2X specializes in industrial projects involving hydrogen, ammonia, and methanol across Europe, backed financially by CPP Investments, a global investment firm managing funds from the Canada Pension Plan (CPP). Their current portfolio includes MadoquaPower2X, a circa 500 megawatt green ammonia production facility in Portugal, and ErasmoPower2X, a gigawatt-scale solar power generation and green hydrogen production project in Spain.
The new project in Estonia is expected to create over 2,000 construction jobs along with over 200 jobs in the supply chain and on-site throughout its development, construction, and long-term operation phases.
Seizing the green opportunity
Pärnu plant will primarily use sustainably harvested biomass and residual forestry streams from Estonia. A large portion of this biomass is currently exported from Estonia as pulp logs, pellets, and wood chips, with limited economic value-added domestically. Meanwhile, the green fuel demand in Europe is surging, with the market size reaching 11.16 million tons in 2023 and expected to grow at a CAGR of 3.5% to around 15.26 million tons by 2032, according to research estimates.
Peter Daemen, project executive at Power2X, described the project as a unique opportunity to establish a leading green methanol facility in Europe and to propel Parnu and Estonia into a hub for sustainable industries, contributing significantly to the national energy transition. “The project is currently in the feasibility assessment phase and is starting the permit process,” added Power2X representative. Production is planned to start in 2028.
Pärnu Mayor Romek Kosenkranius expressed enthusiasm for new development opportunities in the city, citing the potential for offshore wind farms and biomass valorization. “According to Power2X’s plan, the future new logistics capabilities of Pärnu County, including the Rail Baltica freight station, will be combined with our traditions in optimizing industries,” he added.
Interested in tapping into new energy? Book a time via e-Consulting to speak to your personal investment advisor.
