When the UPM paper mill was closed down in Kajaani in December 2008, it was both the end of one era and the beginning of a new one. Now, one of the most powerful supercomputers in the world is located on the site where the paper mill used to be. The feared catastrophe caused by the closure of the mill never happened. The paper rolls the former mill shipped around the world have changed to global data exports, and Kajaani is on its way to becoming the cradle of European artificial intelligence.
The “Hunger Land” of the past is no longer more than a distant memory. We already became familiar with hearing terms like sudden structural change subsidies, disappearing jobs and declining population used in headlines to describe Kainuu. Now, the tune is totally different. There is talk about the miracle of the Hunger Land and exceptional economic growth.
Everything goes back to a major transformation in the autumn of 2008. The forest industry giant UPM announced that it was going to drive down its traditional paper mill in Kajaani, leaving more than 500 people without work. Unlike in Voikkaa a couple of years earlier, the plans for the closure were different.
“When the UPM paper mill in Kajaani was closed, we met with the company’s management and city representatives the next day and agreed on cooperation. The company set up a business park organisation at the paper mill and tasked it with acquiring at least as many jobs – that is 535 – as there were outgoing employees,” says Risto Hämäläinen, Director of Development, City of Kajaani.
Thus was created Renforsin ranta business park, the current cradle of data centres and supercomputers. Salla Ventonen, Service Manager of Renforsin ranta, has seen both the golden days of the paper mill, its end and the new rise of the region. Ventonen is a long-term paperworker. She acted as a shop steward at UPM’s Kajaani paper mill when the announcement of the closure was published.
Although the decision to close down the mill was a hard blow, when the initial shock had dispelled, strong faith in the future remained. According to Ventonen, the decisive factor was specifically the fact that future plans had already been made before the closure decision. Although, in spite of her shop steward position, she was not aware of them at that point either. When the decision to close the factory was announced on Wednesday, the paper machines were run down as a protest for the rest of the week. However, the very next week we already got some information about a business park being established, she recalls.
Other support measures were also initiated immediately: personnel interviews and mapping of personal situations, the Employment and Economic Development Office’s own service point for those to be made redundant, an own path tailored for those wishing to receive education or training and personal plans for those close to retirement age, and so on. People came to believe that there was a solution for everyone.
“Getting started right away was very important. We did not get stuck in grieving what we had lost, but we decided to move on. There were people elsewhere, trying to stir up a rebellion, but the paper mill staff committed themselves to a forward-looking operating model,” says Ventonen.
When supercomputers moved to Kajaani
A key factor in Kajaani’s rise on the global data center map has been CSC – IT Center for Science, which placed Finland’s first national supercomputer at Renforsin Ranta business park in 2013. Today, supercomputers and their immense computing power and AI capacity are essential for cutting-edge research across nearly all fields. Companies also have growing needs for high-performance computing.
Renforsin Ranta now hosts the pan-European LUMI supercomputer and two national supercomputers. LUMI, one of the world’s most powerful supercomputers, was inaugurated in Kajaani in 2022.
This year, Finland opened one of Europe’s first AI factories. It provides AI researchers and developers with computing power, data resources, and the expertise needed to use them—all in one place. The AI factory initially utilizes LUMI, which will gradually be replaced by LUMI-AI, a new supercomputer optimized for AI development. The environment will also be complemented by an experimental quantum computing platform, LUMI-IQ. Both new systems will be located in Kajaani.
The two national supercomputers will soon be replaced by a new national supercomputer, Roihu, within the coming months.
“CSC and LUMI’s reputation has been our most important marketing tool globally. Before that, we struggled for a long time, but all credibility issues disappeared with LUMI. If a consortium of 11 EU countries dares to invest hundreds of millions here in Kajaani, others will trust us too,” says Salla Ventonen.
Risto Hämäläinen agrees, noting that LUMI has also become a popular destination for research and development professionals.
Currently, the former paper mill area accommodates not only CSC but also the Icelandic data centre company Borealis. The company originally purchased a local data centre and is currently expanding the existing centre. The British company XTX Market, engaged in shares and currency trading, is also building a giant data centre in the vicinity.
And, of course, we have the world’s largest search engine company Google, which has its own gigantic investments plans in Otanmäki, Kajaani.
“The reason behind all this is the stable access to electricity that we have in Kajaani. There is also a lot of unbuilt forest land available, so, there will be room for expanding operations in the future,” Risto Hämäläinen says, summing up the benefits of Kajaani and the Kainuu region.
15-year march to the data centre market
When the paper mill was closed, that was the end of Salla Ventonen’s work in the paper mill area as well. However, she returned to the Renforsin ranta area as soon as in April 2009, when the new business park began to find its form and needed a person to market it and act as an organiser of activities.
At the time, the organisation had seven employees. They were tasked with creating something new from the ashes while the paper mill was being torn down around them. Building up and building down at the same time. The demolition of the paper mill took a total of four years.
“In the beginning, I asked my supervisor what I was supposed to start doing now. The answer was: try to come up with something. The first thing I did was to order flags with Renforsin ranta logo to fly in our flagpoles. When they arrived, I held a pompous flag raising ceremony,” Ventonen recalls with a smile.
In reality, there has been a huge amount of construction and other things to do, as we have had to create a completely new service model for the business park, draw up a strategy, attract companies and map out their needs. The thing Ventonen has learned over the years is that building a reputation and, in particular, building an international reputation is a slow, long-term process.
“Nothing happens in a year or two. Now, we have been working on this for more than 15 years, and our position in the data centre market is just beginning to show. So, not exactly a quick march. 15 years ago, the data centre market was only starting to emerge internationally. The scale of the market has exploded to its current extent just recently.”
Utilising excess heat and safeguarding Europe’s digital sovereignty
Measured by employment indicators, Renforsin ranta has for a long time been employing more people than the paper mill did in its final stages. The magical number of 535 employees was eventually broken already in January 2012. Instead of one company, there are now many employers, as well as foundations on which the Kainuu economy can rest. And that is nothing but positive.
Kajaani no longer aims to increase the number of data centres as such but to develop new business and innovations around them. In addition to the data centres and the new opportunities they offer, the regional economy in the Kajaani area is based on the mining industry, the metal and ICT sectors, as well as the region’s tourism. In the latter, Vuokatti, located in the neighbouring municipality of Sotkamo, is one of Finland’s largest tourist centres.
In the future, the excess heat of data centres will cover approximately 80 per cent of the City of Kajaani’s need for district heating. At the same time, efforts are being made to develop new innovations and uses around excess heat. For example, Kajaani University of Applied Sciences is currently studying how excess heat could be utilised in different ways, in wastewater treatment, greenhouses or fish farming, for example.
CEMIS, a research and education centre specialised in measurement technology and data expertise, also plays a key role in the development work. CEMIS is jointly owned by the universities of Oulu and Jyväskylä, Kajaani University of Applied Sciences, VTT Technical Research Centre of Finland and CSC. Measurement technology has a strong history in Kajaani, and CEMIS has also been built upon this basis.
However, the importance of supercomputers is even greater from the perspective of the digital sovereignty of the whole of Europe, says Niina Ahtonen, Director of CEMIS.
“We have a big role to play in that. CSC represents security of supply for research and the scientific community. Companies have access to their share of LUMI’s capacity, and it is very significant for Europe.”
According to Ahtonen, in times like this both ordinary citizens and states appreciate the fact that, for example, data stored in cloud services – whether it is personal photographs or state-level data – is stored in Finland rather than somewhere else. It also matters where AI is trained.
“For example, ChatGPT is based on the material it has access to. Perhaps we would rather have a language model trained by Europeans than, for example, Chinese.”
Aiming for a positive housing shortage
Although the Kainuu economy is growing, the population has not increased that much. The growth comes mainly from abroad, and the lack of labour in growing sectors challenges the city.
The University of Oulu, Kajaani University of Applied Sciences and Kainuu Vocational College try to train employees for working life needs and tailor studies with a view to data centres and artificial intelligence, among other things. The mining industry, on the other hand, trains its own experts, using the apprenticeship method, and has succeeded well in attracting career changers and young people to work.
Therefore, the future in the hilly landscapes of Kainuu looks bright for the time being. The Kajaani Director of Development refuses to reveal any euro amounts or target figures for jobs, but he does have one objective in mind.
“In Kajaani, we are not yet suffering from such a positive problem as housing shortage. So, the vision could be that, in ten years’ time, we can report that the housing shortage in the neighbouring municipality of Ristijärvi is getting worse – that could be a good goal,” Risto Hämäläinen says with a laugh.
Kajaani is part of the InnoCities network. The spearheads in developing Kajaani are measurement technology and measurements as well as high-performance computing, artificial intelligence and data centres.
