LC Paper’s energy was already 100% renewable, mostly bought from small hydroelectric plants high in the mountains north of Barcelona, Spain. Now, a total net zero life cycle is being brought in-house. General Manager Pau Vila explains the schedule.
The energy crisis has been a severe issue for the European industry during the past few months. Tissue production is a very energy intensive operation, both in terms of electricity (the price of which is heavily linked to the gas price, due to the high exposure of the European energy mix to gas-based electricity generation technologies) as well as in terms of industrial heat, for which gas is the main source. The cost increases have been in some cases five-fold or six-fold compared to previous years, an unbearable pressure for tissue mills. During certain periods of the past summer, our average monthly energy bill went from the usual €350,000 – €400,000 to touching the €2,000,000 figure.
Figuring out ways to replace gas with other technologies requires technical creativity, but can also be an opportunity to pave the way to mid- and long-term decarbonisation needs. That is precisely the case of LC Paper. Being a smaller tissue mill makes our company particularly exposed to cost fluctuations due to the decreased negotiating power with utilities suppliers. Despite this challenge, we have been able to overcome the energy crisis through energy innovation projects that started before the energy crisis, originally not approached as cost-cutting initiatives but rather as decarbonization initiatives.
The first of those projects is an in-house solar plant with around 8,500 solar panels over a terrain of 20ha, adjacent to our Besalú mill. This installation was commissioned under a PPA schema, in which a third party develops the initial investment while an agreement is made to sell all the produced electricity to the mill based on a fixed cost which is now significantly lower than the average electricity price of the Iberian mix. LC Paper already used 100% renewable energy for the past years, but most of that came from grid purchasing with certified renewable origin: the mill is surrounded by mountains where small hydroelectric plants have traditionally been installed. The main goal of the on-site solar plant was to have a higher commitment to renewable energy through our own generation rather than a purchase-only strategy, but again, the current context has made this project financially competitive. The on-site solar plant currently covers around 13% of the company’s electricity needs, while a Phase II is already projected with the aim to scale the in-house photovoltaic production to 13 MWp. The main challenge of the on-site electricity generation is the low maturity level of electricity storage at that scale, since it is unusual to find batteries that allow for the storage of such figures.
The second project is the partial substitution of fossil-based gas with biogas, specifically biomethane. Biomethane is originated in nearby farms: the residues from animals are a source of energy through fermentation, which creates a non-fossil type of methane which can be used as a substitutive for regular methane. The cost of biomethane was usually much higher than that of the of fossil gas, between two and three times; however, LC Paper still chose to initiate this project as a decarbonisation initiative. Due to the current context of the gas market, it is now a significantly more cost-effective alternative: around half the price of fossil gas. This type of bio-based combustible is delivered to our mill in liquefied form inside tanks and is injected into the existing gas pipes. The main limitation is a logistic one: how many liquefied trucks can be delivered in a day – however, biomethane is capable of being mixed with fossil gas in environments where the consumption exceeds the delivery capacity.
The third energy project is a high-capacity biomass boiler. Our mill is surrounded by forests in a Mediterranean climate, which is prone to suffer wildfires during the summer season. To prevent wildfires, residues in the soil of the forest need to be collected. Those residues are too poor to turn into wood, but are very combustible, so they are an interesting alternative to burning fossil fuels. During the lifespan of the trees and other vegetation in the forest, the items that are later collected from the soil absorb carbon emissions – in fact, they absorb more emissions than those created during the combustion process, so their footprint is carbon positive. Biomass also used to be a more expensive alternative than fossil gas, but the latest events have turned this situation upside down. The main challenge with biomass is that tissue production requires steam at very high temperatures, while many biomass solutions cannot produce heat at the required high temperatures – for that reason, we mostly orient the biomass project to produce kraft paper where the temperature requirements for the hood are lower.
Our long-term vision of a net zero life cycle for tissue projects required committing to higher costs than traditional energy sources. In the middle of executing those investments, the situation changed in a way that this is now also the most cost-effective energy layout.
Through substituting all the energy sources (both electricity and heat) for renewable sources, we solve most of the Scope 1 and Scope 2 emission challenges. Scopes 1 and 2 refer to the direct emissions of our industrial activity and the energy sourcing. However, to reach the net zero life cycle goal, we still need to solve the Scope 3, which is related to the suppliers of the raw material used as the input of our activity as well as the transportation of the finished goods to the final customers. For that matter, we have partnered with the Spanish pulp producer Ence with the product Naturcell Zero: an unbleached pulp in which the supplier reduces the carbon footprint and offsets the remaining figure. More of those partnerships will be needed also with chemical products’ suppliers and logistics partners before reaching a full net zero tissue life cycle, which we see closer than ever. In the areas where we are unable to cooperate with the supplier to design a net zero fulfilment alternative, we plan to offset the emissions ourselves – that includes chemical products and other minor inflows to our production processes.
Our advances in the decarbonisation of tissue production and other circularity innovations, including the commitment to 100% plastic-free packaging, have allowed us to be the worlds’ first tissue mill globally with the B Corp certification. B Corp is a global certification that defines the social, environmental, and governance best practices for businesses – in other words, the CSR gold standard through which corporations from multiple geographies and sectors authenticate their sustainability efforts, including companies like Danone, Alpro, Patagonia, Ben & Jerry’s or The Body Shop.
The investments and innovations previously described need to be clearly differentiated from greenwashing claims, and we see certification programmes as the key for building trust in sustainability.
Our company was already certified in more specific industrial programmes, such as the ISO 14.001 for environment, the ISO 14.067 for carbon emissions, the ISO 50.001 for energy savings and badges such as the Ecolabel or FSC. Unlike all those programmes, B Corp’s approach is more holistic. It involves strict environmental requirements such as accreditation of the energy, raw material and water sourcing, excellence in waste processing, circularity initiatives and plastic elimination, amongst others. It complements those requisites with social qualifications including the ratio between the lowest and highest salary, inclusion projects for minorities, satisfaction ratios amongst the employees and ethical policies and controls. After completing the assessment with a sufficient qualification as to be certified B Corp, it is compulsory to change the incorporation documents of the company to add to the company’s mission the orientation towards generating positive impact, both socially and environmentally. It is also needed to incorporate the impact monitoring into the functions of the Board, on the same level as it needs to look after creating financial value for the shareholders.
Through the more horizontal nature of the B Corp programme, customers clearly identify the certified companies as positive corporations in all the fronts – not only in a certain area such as in the case of the ISO programmes. It is a more recognisable badge too, which has already resulted in better visibility for our sustainability efforts and increased projection into the niche channel of eco-friendly tissue, where our company is clearly oriented.
We continue to see strong potential in combining the increasingly demanding environmental requirements with initiatives that lower the financial exposure amid the current energy crisis. Being resilient through a solid sustainability strategy will shape the future winners in the tissue industry. Instead of taking an opportunistic approach where the lowest cost energy sources are selected at each point of our history, we strive to define a long-term strategy where the energy layout is coherent over time.
