Thereby Contributing to action against climate change

The pulp and paper industry is energy intensive and has a responsibility to look carefully at the impact of fossil fuels. Given the volatility in pricing of energy over the past number of years, there is also a commercial imperative to achieve the most efficient use of energy. SKG looks upon improved energy usage as a major priority.

In terms of improving production efficiencies we have been making additional investment in co-generation. In 2009, Smurfit Kappa Zülpich Papier (the biggest of SKG’s German recycled paper mills, located near Cologne) began building a new multi-fuel boiler for the production of electricity and steam for the paper mill which will be operational in 2010.

The power boiler doubles the capacity of the old boiler to 100 tonnes of steam, while utilising the same technology. It will burn both brown coal from local sources and biogas, derived from anaerobic process water treatment at the mill.

40,000 tonnes of organic waste from the paper recycling process will also be consumed, of which 20,000 tonnes will come from the mill itself and the other 20,000 tonnes will come from other paper mills in the Group. 15 MW of electricity will be produced, which will increase the mill’s self sufficiency with regard to electricity to almost 100%. The start up of this power plant is scheduled for September 2010.

Taking into account the higher efficiency of a cogeneration plant compared to a conventional electrical power station, this investment will allow a decrease in overall fossil CO2 emissions by 4% for producing the same amount of steam and electricity (source: EIA database average figures for Germany 2007). This results from the fact that the new boiler has a higher efficiency than the existing one although the mill’s on-site fossil CO2 emissions will rise as brown coal will replace part of the natural gas currently burned.

Energy efficiency initiatives
During 2009 the project for a biomass boiler at Cellulose du Pin made considerable progress - see side panel.

In the course of 2009, four SKG mills have been audited by an expert external company to assess energy consumption.

Audits have been carried out by Allplan in Cellulose du Pin (France), Mengibar (Spain), SSK (UK) and Ania (Italy). To implement the actionable points revealed by the audits we invested in excess of €1 million to save 10 GWh of electricity, representing variously between 0.2% and 2% of electricity consumption by these mills. External energy audits of additional mills will continue during 2010.

In Europe, the co-generation ratio for 2009 increased by 7% compared to 2008, for the use of electricity for all our operations. The main reason for this increase, besides lower paper production levels, comes from our two mills in Austria and Slovakia that returned to operating their CHP at their normal levels after maintenance work in 2008. The steam turbine at the SKG kraftliner mill in Piteå (Sweden) also operated for the first time for a full year.

In 2009 we achieved the commitment we made in our 2007 Report to increase by 5% our own rate of electricity produced from Combined Heat and Power (CHP) plants. This was achieved a year earlier than planned.

In Latin America we made even greater progress than in Europe as the rate of electricity produced by CHP plants increased by 10%. This increase is mainly the result of the installation of the new RB3 recovery boiler in Cali, with its additional capacity for electricity generation.

Some other initiatives and investments were decided upon in 2009, all of them aiming to achieve our main objective of reducing our fossil fuel consumption. A good example of this is the use of biofuel in lime kilns at our Piteå mill in Sweden (see side panel).

Energy, CO2 emissions and other air emissions related data are reported for individual mills in the tables on pages 52, 53 & 55. The methods applied for calculations as well as details on specific definitions are given in the glossary on pages 67 to 72. We are making ongoing efforts to increase standardisation of our data collection methods and to improve the quality and scope of our key environmental indicators. In 2008, we implemented a new web-based reporting tool that helped us to standardise the reporting system. Although these efforts – in particular the web based reporting tool – have a positive impact on data quality, we are working to further improve the internal controls on data quality. We realise that energy and CO2 information involves uncertainty due to the nature of the data. We will continue to focus on improving the quality of our environmental data and for this purpose we will enhance internal controls on data quality across the Group.

In this report default Lower Heating Values and CO2 emission factors have been used to calculate the energy use and CO2 emissions from the use of biogenic energy sources where actual values were not available. The actual values can differ from the default values. Going forward, SKG will make an effort to increase the use of actual measured Lower Heating Values and CO2 emission factors.