Finnish startup Solar Foods—which makes a yellow, protein-packed ingredient called Solein by feeding microbes elements from the air—has secured a €10 million ($10.6 million) grant from Business Finland, part of the Finnish Ministry of Employment and the Economy.
The capital injection is part of a funding allocation to Solar Foods from the European Commission’s Important Projects of Common European Interest (IPCEI) initiative, which backs projects that promote the development of lower-carbon technologies.
It follows a €33.6 million ($35.6 million) grant awarded in late 2022 to help construct Solar Foods’ demo plant (Factory 01) near Helsinki, which opened last April and is now producing 160 tons of Solein per year for product testing in the US and Singapore. Capacity will increase to 230 tons in 2026.
The new funding will support regulatory filings, product launches, and the pre-engineering phase of a 12,800/tons/year commercial-scale production facility (Factory 02) capable of producing Solein at €4.30-5.20/kg ($4.60-5.50/kg), figures expected to decrease further with future technical developments, says the company.
“The remaining funds under the €110 million ($117 million) IPCEI notification amount to approximately €66 million ($70 million) and are intended to partially cover the costs for the construction of the company’s Factory 02. The pre-engineering phase of Factory 02 facility started in February 2025,” added the firm, which listed on the Nasdaq First North Growth Market Finland marketplace last September.
Large-scale factory to be built in three phases
According to financial filings on the company website, Factory 02 will be developed through a phased investment plan, says the firm, which recently struck an engineering and procurement partnership with Blue Projects, a global design, engineering, and project management company specializing in larger-scale construction projects.
The final investment decision for Factory 02 will be made in 2026, with the first phase aiming to become operational in 2028 and the following phases in 2029 and 2030, says Solar Foods, which is targeting price parity with whey protein isolate. Phase one will require an initial capital expenditure of €134 million ($142 million), with expected annual revenues of around €48–55 million ($51-58 million) and EBITDA margins of 57-62% .
Solar Foods is currently evaluating multiple locations for Factory 02, prioritizing sites with access to the electricity grid.
“Our commercialization strategy in the US focuses on health and performance nutrition, which is one of the world’s most important markets for high-protein products. We are focusing on ready-to-mix powders, ready-to-drink beverages and protein bars. We are also moving from offering powder prototypes to a conceptual sales model where we will introduce finished products containing Solein.” Pasi Vainikka, cofounder, Solar Foods
Gas fermentation
Founded in 2017 as a spinoff from VTT Technical Research Centre of Finland and LUT University, Solar Foods is one of a small, but high-profile group of startups attempting to decouple food production from agricultural land via gas fermentation. Solar Foods uses carbon dioxide and hydrogen instead of sugars to feed its bacteria.
Assuming the energy-intensive parts of the process are powered by renewables, says the firm, the technology has environmental benefits over animals for protein production: lower emissions, reduced water and land use, and the ability to locate plants nearer to the end consumer.
Solar Foods has secured novel foods approval for Solein in Singapore and self-GRAS (Generally Recognized as Safe) status in the US. It has also submitted a safety dossier to EFSA (European Food Safety Authority) for EU approval as a novel food, which it hopes to secure in 2026.
In a recent interview with AgFunderNews, cofounder Pasi Vainikka said that electricity “is about half of our production costs, mostly for the electrolysis process [using electricity to split water into its constituent parts, hydrogen and oxygen]. So the viability of our process depends on which country you are in and what type of electricity market it has. You need an efficient electricity market where you operate.”
He added: “Right now we source liquefied carbon dioxide, which you can get from different industrial sources. And we use electrolysis to get the hydrogen, which we bubble through our fermenter using pipes.” However, in a recent filing, the company said it was “exploring cost-saving opportunities” including “utilizing hydrogen supplied by external partners.”
Further reading:
Unibio CEO: ‘We have the most efficient reactor design for gas fermentation’
Can gas fermentation deliver on its green promise for food and feed? In conversation with Calysta
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