1. Speaking the same language The way forward in tracking industrial Energy efficiency and CO2 Emissions Marco Mensink IEA, Paris, 1st and 2nd of October 2007

2. ICFPA The organization of the world's forest and paper industry associations 19 members from all over the world representing 90% of global pulp and paper capacity and 50% of woodworking capacity A forum of global dialogue, coordination and cooperation Today speaking for the pulp and paper industry.

3. ICFPA and Climate change The global forest products industry is strongly committed to meeting the challenges of climate change. Trees, wood and paper products are uniquely renewable and recyclable resources that help reduce greenhouse gasses by storing CO2 from the atmosphere. Fibre from sustainably managed forests makes a positive contribution to the world’s future energy supply. The industry is committed to innovative energy solutions that will increase efficiency, reduce reliance on fossil fuel and expand the use of renewable energy sources.

4. The sector in summary The global pulp and paper industry consists of about 5000 pulp and paper mills. Although there are many international and global companies, a large part of the sector is also made up of medium and smaller enterprises. Pulp and paper are made around the world and there is an active global trade both in resources and final products. It is a globally competing sector. Pulp and paper are umbrella words for many different products and “grades”, from business to business to direct consumer products.

5. Pulp Production by Region in 2005 Total: 189.0 Million Tonnes

6. Pulp Consumption by Region in 2005 Total: 188.5 Million Tonnes

7. Paper Production by Region in 2005 Total: 367.0 Million Tonnes

8. Paper Consumption by Region in 2005 Total: 366.3 Million Tonnes

9. Recovered Paper Balance (2005) 1000 t Net Exporters Net Importers *EU27 plus Norway and Switzerland *

10. Grades: Milady’s Fan PAPER AND PAPERBOARD PRODUCTION IN WESTERN EUROPE End products - Substitution Total: >70 million tons Substitution ranges Copy papers Stationary Envelope paper Household & Sanitary Products T r a n s p o r t P a c k a g i n g Consumer Packaging Food Packaging Sacks Bags Misc. P r i n t i n g a n d W r i t i n g P a p e r s C o r r u g a t i n g M a t e r i a l s Carton- boards Newsprint Uncoated Mechanical Coated Mechanical Coated Woodfree Uncoated Woodfree Tissue Kraftliner Testliner Fluting Medium SBS FBB WLC N e w s p e a p r s Inserts H i g h q u a l i t y a d v e r t. Catalogues Brochures LPB Sackkraft Other High growth Medium growth Low/No growth > 3% 1.75 - 3% < 1.75% M a g a z i n e s D i r e c t o r i e s Degree of fossil CO 2 emitted during production High Medium high Medium low Low

11. Energy in pulp and paper production

12. IEA key findings in tracking The pulp, paper and printing industry consumed 6.45 EJ of final energy in 2004, accounting for 5.7% of total industry energy use. Printing represents a small share of the industry's energy demand. In pulp and paper production, the industry generates about half of its own energy needs from biomass residues and makes extensive use of combined heat and power (CHP) technology,

13. IEA key findings in tracking (2) There are notable differences in energy use for pulp and paper production between countries, due to a range of factors such as product mix, processes used, plant size, technology, technical age, feedstock quality, fuel prices and management attention to energy efficiency.

14. IEA key findings in tracking (3) Energy efficiency gains can be achieved if existing mills are retrofitted with current energy efficient technology, but investment costs and competitiveness are key determinants. There is potential for more use of heat recovery. Putting excess heat to use in a more effective way could provide savings, but the economic viability depends on the need for low grade heat.

15. IEA key findings in tracking (4) Increased paper recycling and recovered paper use could help reduce energy consumption in the industry. While Europe, Japan and Korea appear to be close to the practical limits for paper recycling, North America and parts of Asia could benefit from more effective policies on waste disposal to encourage higher rates of paper recycling.

16. On the IEA methodology An indicator method is developed in this study that compares a theoretical sector energy use if best available technology (BAT) were applied with actual energy use according to IEA statistics. The method discerns energy use for mechanical and chemical pulp, pulp from recovered paper and various paper qualities. These indicators are suited to identify areas where further analysis is warranted. This indicators analysis raises a number of issues concerning data quality which requires further discussion on the availability, quality and consistency of data across countries.

17. But a firm conclusion Based on country comparisons, the remaining energy efficiency potential in the pulp and paper industry is estimated to be 1.0 EJ per year of final energy, or 1.3 to 1.5 EJ in primary energy terms, depending on the efficiency for power and steam generation. If higher recycling rates and CHP were also considered, the total final savings potential would be 2.1 to 2.4 EJ of final energy per year. ?

18. Feedback (1) IEA has done a tremendous effort and groundbraking work. Our compliments. but These seem to be huge and important conclusions compared to the issues remaining in the methodology and data collection.

19. Speaking the same language IEA statistics still do not match the definitions and categories of the international pulp and paper industry federations, or for example the EU ETS. A crucial issue is the treatment of CHP in the statistics. Also printing should be removed, or we should go down one statistical class. We have now worked on global definitions of energy use in the Pulp and paper industry (IEA Paprican project), so that industry speaks the same language. But that does not mean the same language as IEA yet. CHP is one example, subdividing in G8 a second.

20. An outlook to the future The global pulp and paper industry within the forest based sector cluster can be a solution in climate change mitigation. Carbon storage in forests and carbon storage in products are, combined with paper recycling and energy efficiency, attributes that can take us there. A strong effort is needed, indeed, but the industry can be the enabler for many (bio) climate targets.

21. Improving performance by technology Installing latest technology and improving efficiency is a continous target and process. The investment climate determines progress, as the industry depends on major investments in long investment cycles. The technology race for technologies like black liquor gassification or biorefineries is not run yet. Let alone for CCS. The step from lab to demo to full scale needs to be crossed.

22. Feedback 2 Todays workshop with estimates on tracking industrial emissions and future scenarios for emissions might be a bit premature. Both methodology and data collection still need work, before we in turn can assess the estimates of IEA in a proper way. Also energy data have a clear competition law element and global management needs to be organised.

23. Summary We clearly recognise the urgent need and challenges. We need a joint industry and government approach to jump the hurdles described. But that is not the debate if there will be CCS by 2015, but on how to bring 5000 companies together in a single approach. We look forward to this debate.