1 EUETS Benchmarking for the Paper Sector A Short Review For WG5/6 B. C Bateman - Cpi

2 Pulp and Paper in EU and EEA 830 Companies 1219 Pulp and Paper mills Producing: - 42 Million tonnes of Pulp - 99 Million tonnes of Paper and Board - Uses 47 Million tonnes Waste Paper - Europe’s largest recycler & user of biomass - Capital intensive with high break even point - Contributes strongly to EU economy - employs 300,000 and TO 80 Billion Euro

3 Emissions Benchmarking of Production Thousands of paper grades made – ranging from bulk grades (newsprint,tissue, copier and packaging) to speciality papers (e.g.banknotes, bonds,security,tea-bags) Regional differences in grades made –some countries do not make all Production is energy intensive – costly & drives a natural process of energy efficiency Industry is large user of biomass and hydro (northern Europe) – fossil and grid power (central and south)

4 Emissions Benchmarking of Production Specific Energy Consumption (SEC) is a prime measure of use and may be used to characterise the energy consumption and emissions of groups of similar papers (e.g. newsprint) SEC variation across products range >10:1- typically >20,000 kWh/t –no simple solution Issue is variable spectrum of energy use – renewable and non-renewable –by region and type of paper High energy/emission paper products not ‘gas guzzlers’ but demanding products for specific uses UK is ca 5% of European industry production but with relative high value products

5 Summary Benchmarking the Paper Sector Complicated balance of production and energy consumption and value across Europe Agreement at EU level on appropriate benchmarking will be difficult,long and perhaps unworkable. National benchmarking easier –verified NAP baseline data and EUETS emissions now providing coherent data for analysis. Issue is how to apply the analysis to NAP allocation and length of Phase – adjustment? Likely Relationship: Emissions =  P.SEC.SF Where P= Production, SEC, SF = Subsidiary factors – e.g. technology/range/region