Last week, the government decided to increase Metrosert's share capital by €11 million to allow the company's applied research center to launch three new areas of activity.

Minister of Economic Affairs Erkki Keldo (Reform) told ERR that the field of applied research serves as a missing link between top-level university science and entrepreneurs. While universities handle the initial stages of developing products or services, companies need scientific testing before mass production can begin to bring a new product to market.

With the help of the latest investment, the applied research center will be able to establish testing grounds and laboratories where businesses can purchase services under market conditions to develop their products and add greater value to them.

According to Tallinn University of Technology (TalTech) Vice-Rector for Research and Business Relations Erik Puura, it should be well known that Estonia faces serious challenges in funding and staffing professorships in the field of engineering, as well as in ensuring academic continuity. To address this, engineering higher education must be of the highest quality, supported by a strong doctoral system whose graduates are motivated to teach in Estonian.

"For that to happen, researchers, lecturers and doctoral students in the field of engineering at TalTech need to create industrial property through applied research based on their ideas and independently conduct high-level, high-quality applied research in the interest of businesses — using modern scientific equipment," Puura explained.

However, according to Puura, the current situation is such that the entire remaining value of TalTech's scientific equipment amounts to just €15 million.

Although the university is involved in several grant applications through programs administered by the Ministry of Education and Research, European Union structural fund rules allow equipment purchased through these funds to be used for business collaboration only up to 20 percent of the time.

"At the same time, business interest in commissioning research from TalTech through the EIS-funded applied research program has faded, as it's much easier for companies to simply hire TalTech employees directly when needed," Puura noted.

Government favoring scientists moving to the private sector

The vice-rector of TalTech added that several other state-funded measures also encourage researchers to move into the private sector.

"We're not claiming that allocating €11 million to the applied research center established by AS Metrosert is a bad decision, but it's clear that if the goal is to make the center financially self-sustaining, then it will need innovative solutions developed under laboratory conditions to further refine, as well as a workforce consisting of both professional researchers and university graduates," Puura explained.

He also noted that there are many engineering fields the applied research center does not cover, in which TalTech faces clear demand from businesses — provided the university has access to the modern equipment needed to carry out the work.

Puura pointed out that one TalTech lecturer-researcher has already taken on a part-time position at the applied research center and pressure on academic staff is only expected to grow as the center expands its operations.

"The bottom line is this: if the state only supports the development of the applied research center while leaving engineering researchers and lecturers at TalTech with deteriorating, outdated equipment — and also pulling them away from the university in the process — then we are fertilizing the branch that bears the apple while sawing through the trunk of the apple tree," Puura said.

Erkki Keldo noted that Metrosert itself will not engage in commercial activities: the state is providing initial capital to build out the testing laboratories, but in the future, all business lines are expected to become financially self-sufficient in a market-driven environment.

"Right now, Estonia doesn't have labs or capabilities in these fields. It's not possible to test such services in Estonia, and Metrosert is stepping in to fill that gap," the minister of economic affairs said.

Keldo: Center should bring businesses and universities together

According to Minister Erkki Keldo, the five business areas of the applied research center — biorefining, drone technology, autonomous vehicles, hydrogen technology and the valorization of health data — were developed in consultation with the private sector.

"These are five fields with very high value-added businesses," said Keldo, noting that similar centers exist in Finland and most other countries to bridge the gap between research and entrepreneurship, bringing together businesses, universities and other research institutions.

As a concrete example, he pointed to the biorefining business area, where the wood and food industries can carry out chemical processing, enabling testing at a sufficiently large scale. For drones, the center needs testing grounds and laboratories where drone sensors can be exposed to electromagnetic waves or other interferences. In the case of health data, Estonia is one of the few countries with fully digitized records that could be used anonymously in the pharmaceutical industry and in medical device innovation.

"The applied research center is precisely what our high value-added economy has been missing — it brings together basic science and entrepreneurship. Often, companies have had to go abroad for these services, but now they will be available in Estonia," Keldo said, explaining the rationale behind the initiative.

From the outset, it has also been important to ensure the center does not duplicate the work of universities, the minister emphasized. Each business area has its own advisory board that includes a university representative, and motivating researchers who create intellectual property is a key goal. Keldo noted that at the world's top universities, researchers are often active entrepreneurs themselves, but that this is a topic requiring further discussion with universities, as human resources are always limited.

Keldo added that there are no plans for the state to consider privatizing Metrosert, as it is a metrology agency with more than a century of history, responsible for calibration and certification.

"It's the national standards institution — essential, for instance, when an Estonian company exports to Germany or elsewhere and needs certification standards. Metrosert issues those certifications, and because it's a very strong scientific institution, it was chosen as the parent organization for the applied research center," Keldo explained.

Last August, the government increased Metrosert's share capital by €5 million to launch the biorefining business line within the applied research center.

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