Confederation of European Paper Industries
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Who is CEPI?

The Confederation of European Paper Industries (CEPI)

is a Brussels-based non-profit-making organisation regrouping the European pulp and paper industry and championing this industry’s achievements and the benefits of its products. Its collective expertise provides a unique source of information both for and on the industry, coordinating essential exchanges of experience and knowledge among its members while providing technical assistance to legislators. Through its 18 member countries (17 EU members plus Norway) CEPI represents some 515 pulp, paper and board producing companies across Europe, ranging from small and medium sized companies to multi-nationals, and 950 paper mills. Together they represent 23% of world production.

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news | 19 Apr.2016

Reaction to the tiered approach to carbon leakage protection

The signatories (see below), energy-intensive industries express concerns regarding the so called “tiered approach” to carbon leakage protection under the EU ETS

The tiered approach1 would reserve free allowances for some sectors at the expense of others. It goes against the principle set in the October European Council Conclusions that best performing companies in ETS carbon leakage sectors should not bear further carbon costs. Indeed, it would ensure that even best performers in most sectors would bear significant carbon costs and expose them deliberately to carbon and investment leakage.

The proposed tiering has no environmental or economic justification and is based on flawed assumptions (“cost pass-through”) of in reality unpredictable market dynamics. Depriving sectors of carbon leakage provisions would not deliver decarbonisation through investment and innovation. Moreover, it could well prove to have been entirely unnecessary. All forecasts, including the Commission’s Impact Assessment, predict that there will be sufficient allowances available to ensure full free allocation to benchmark levels at least until 2025: and there are other proposals for ETS reform that would deliver full and effective carbon leakage protection without the need for arbitrary discrimination.

To that end, we continue to support an approach based on realistic benchmarks, allocation based on more recent production data and an adequate reserve that ensures full allocation to benchmark levels. The proposed share of allowances to be auctioned shall also be recalculated downwards, as analysis of the EC proposal shows, it does not properly include the number of allowances which were to be given out for free (i.a. unallocated and left-over NER allowances).

In the circumstances, the “tiered approach” would introduce an unnecessary and unfair discrimination between sectors. Fairness and solidity should become key principles of policy making. Jobs in one sector are neither more nor less important than those in other sectors. The signatories fully share and support the BusinessEurope views on tiered approach as expressed in a statement on April 14th.

We ask you to create a framework that gives all sectors an equal opportunity to compete and thrive in Europe, and not to pick certain sectors to stay in Europe. It would undermine our industry’s faith in, and support for, the ETS as a means of reducing carbon emissions.

For further information please contact Peter Botschek, Cefic Director Energy & HSSE, e-mail pbo@cefic.be

1 i.e. as presented in a Non-paper on a Tiered Carbon Leakage List in Phase IV of EU ETS (authored by France, the United Kingdom)

 

 

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news | 04 Apr.2016

Joint declaration by a group of industry associations “2016, time to deliver… an ambitious power market reform”

The signatories of this declaration gather leading associations and industry groups with a clear stake in Europe’s energy policy. We share the conviction that only a flexible and dynamic energy system, making the best use of innovative and distributed supply and demand options, can ensure a cost-efficient and sustainable transition towards a decarbonised energy system.


We strongly believe that a market-driven environment is the best means to provide long-term investment signals while meeting all system needs and accommodating the growing share of renewable energy in the energy mix. The completion of the Internal Energy Market will improve system adequacy and efficiency, increase security of supply, support the competitiveness of European industry, and help deliver the energy and climate goals stemming from the COP 21 agreement and EU’s post 2020 objectives on emissions reductions, energy efficiency and renewables.


However, we see many constraints persisting in the energy sector that affect investment decisions, in particular: 1) depressed wholesale market prices due to overcapacity; 2) fading EU-coordination of energy policies with a tendency towards renationalisation; and 3) an antiquated set of market rules.


Market rules have been tailored to centralised production within national boundaries for too long. Not only have they failed to adapt to developments in energy technologies and evolution of demand patterns both at industry and end-consumer level, but some of them hamper the deployment of renewables, storage and demand-side flexibility. These new technologies can today provide valuable services including balancing energy offering significant flexibility to the system.


The energy system is now more complex to plan, control and balance. It needs enhanced flexibility that could be provided by a mix of options, but this would require significant changes in the relevant legislation. In this respect, we consider the upcoming legislative package on market design as a unique chance to provide the energy sector with a predictable investment framework, fairer market conditions, and ultimately seize new opportunities arising from decentralised energy production and demand side participation.


In particular, we deem essential that any ambitious reform of the energy market addresses the following issues:


1. Providing adequate price signals and further integration of short-term markets across borders
2. Ensuring a balanced approach to system adequacy that fully takes into account the contribution from renewable energy supply and demand sources
3. Implementing a level playing field for all flexibility providers to foster the pan-European trading ofelectricity and grid support services.


1. Providing adequate price signals and further integration of short-markets across borders
In a well-functioning electricity market, unhindered price-formation drives operational choices and investment decisions. Transparent and undistorted market prices must be in place in all time horizons, and allowed to move freely without caps. Wholesale electricity prices reflecting scarcity would signal the need for investments in new capacity. Therefore, price spikes should be treated as a positive sign of an efficient and cost-effective energy system where market participants are free to choose the level of hedging they prefer to contract, revealing the true value of flexibility and energy at all times.
Market rules also need to be adapted so as to enhance clean and flexible energy providers to trade power over broader geographical areas and as close as possible to the time of delivery. In this context, the opening and cross-border integration of intraday market is essential, especially for energy producers whose output is variable. A as long as separate procurement of balancing capacity and energy is guaranteed, another important aspect is the possibility to negotiate the duration of contracts, e.g. for balancing contracts. This is crucial, as certain flexibility technologies may require considerable capital investment and, therefore, contracts with a longer duration.


2. Ensuring a balanced approach to system adequacy that fully takes into account the contribution from different energy sources


The main challenge for security of electricity supply is not the availability of capacity as such, but the availability of flexibility that is needed to support the system and provide for a constant balance between supply and demand.
In order to identify potential, locally constrained adequacy issues, system adequacy assessments should be carried out according to a common methodology and metrics transparently defined in EU legislation1. Such analysis should be performed at regional level and consider the potential of all flexibility options, from the various energy supply and demand sources. This would ensure a rigorously needs-based approach to the introduction of Capacity Remuneration Mechanisms (CRMs) when the market cannot not deliver the adequate flexibility.
If CRMs are deemed necessary, they should be designed in a way that minimises any negative impacts on price formation on energy markets. They should avoid contributing to continued overcapacity situation by keeping redundant and polluting power plants online, and prioritise clean flexibility options as foreseen in the energy state aid guidelines.


3. Implementing a level playing field for all flexibility providers2 to foster the pan-European trading of electricity and grid support services

In addition to the modernisation and further opening of the balancing market, a proper market for ancillary or grid support services needs to be fostered to provide additional non-discriminatory revenue streams to flexibility providers, as well as overall operating cost savings for the energy system. As of today, a number of services and solutions from decentralised generation and demand-side response are technically feasible, but current market conditions do not properly value their commercial provision.
The continued adaptation of balancing and ancillary services markets should foster liquidity and incorporate innovative and decentralised solutions. Prohibitive pre-qualification requirements and access conditions for independent aggregators, extended product-durations or minimum thresholds and symmetric bids are some of the aspects currently hampering an effective market. Moreover, contradictory regulatory signals, e.g. regarding network tariffs, the operation of industrial loads or co-generation should be addressed to ensure demand side flexibility further develops without impeding the achievement of robust energy efficiency targets.

1 Incl. a clear system adequacy target level for all control areas in the EU as many countries are lacking one
2 “A service provided by a network user to the energy system by changing its generation and/or consumption patterns in response to an external signal” (Task Force Smart Grids report, 2015)in

 

 

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Press Release | 18 Apr.2016

Global Forest Products Industry is Part of the Solution to Climate Change

São Paulo – The International Council of Forest and Paper Associations (ICFPA) and its members welcome the signing of the landmark United Nations agreement to tackle climate change, set to take place on April 22. The agreement urges countries to implement policies that would allow them to keep a global temperature rise below 2 degrees Celsius. The global forest products industry has a highly significant role to play in the implementation of these targets.

“The global forest products industry has made significant strides in reducing its carbon footprint, stocking carbon, and generating greenhouse gas removals – all helping to mitigate climate change”, said ICFPA President and Brazilian Tree Industry (Ibà) President Elizabeth de Carvalhaes. “This agreement is crucial to implementing some of the policies that consider biomass as carbon neutral when harvested from sustainably managed forests and to further recognize all positive contributions that forests and forest products provide in combating climate change.”

The inherently-renewable global forest products industry remains committed to mitigating climate change for the benefit of the green economy and society at large. ICFPA members have achieved an impressive 5% reduction in their greenhouse gas emissions intensity since 2010/2011 and 17% since the 2004-2005 baseline year (2015 ICFPA Sustainability Progress Report).

The European pulp and paper industry has been a global champion in mitigating greenhouse gas emissions. It has set itself in 2011 a clear vision of becoming carbon neutral by 2050 and since then, taken concrete steps to reach that goal,” said Jori Ringman, Acting Director General of Confederation of European Paper Industries (CEPI). “Thanks to responsible sourcing practices and sustainable forest management, the forest area is growing in Europe by an area of over 1,500 football pitches per day. CEPI is pleased to see development in the same direction globally”, he added.

The forest industry’s significant role in mitigating climate change was highlighted in the ICFPA-commissioned report Analysis of Forest Contributions to the INDCs by acclaimed researcher Paulo Canaveira. Having looked at the contributions of forests in the national targets of ICFPA member countries (INDCs) and global mitigation effort from 2020 onwards, the report concludes that many countries identify forests and the land-use sector as relevant to policies and measures implemented to meet their targets. Reducing emissions from deforestation, but also sustainable forest management, afforestation and reforestation are commonly mentioned as key mitigation practices. In some developing countries, they even constitute the country’s main contributions.

Other climate change mitigation efforts of the global forest products industry include supporting national and regional climate policies and programs; investing in technologies with low carbon footprints and ones that improve carbon sequestration; and developing bio-based technologies to find innovative ways to use wood fiber and substitutes for goods traditionally made from fossil fuels.
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Note to the editor:

The ICFPA represents more than 30 national and regional forest and paper associations around the world. Together, ICFPA members represent over 90 percent of global paper production and more than half of global wood production.

For more information about the global forest and paper industry, visit icfpa.org.
 

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Press Release | 12 Apr.2016

Bioeconomy 2.0 will help lead the EU’s renewable revolution - with the right support

On the occasion of ‘BioEconomyUtrecht2016’, the fourth Bioeconomy Stakeholders’ Conference, the European Bioeconomy Alliance (EUBA) calls on the EU to lead a worldwide transition towards a renewable, low-carbon economy. Europe has all of the means necessary to become a global leader in the bioeconomy, if its potential is realised and embraced by European policy makers.

The bioeconomy encompasses the sustainable production of renewable resources and their conversion into food, feed, fibres, materials, chemicals and bioenergy through efficient, innovative technologies. It is already worth €2 trillion annually and employs 22 million Europeans, but holds the potential to significantly further boost competitiveness and long-term economic growth. At a time when the pressure is on to deliver on post-Paris climate commitments, the bioeconomy offers a viable solution to today’s fossil carbon equivalents and has the potential to save up to 2.5 billion tonnes of CO2 per year.

In advance of today’s conference, EUBA members, together with other stakeholders in the growing bio-based community have produced a set of recommendations on how Europe can promote bio-based products in public procurement. The report, which will be launched today in Utrecht, outlines what needs to be done at EU, regional and national level to create dynamic new markets for home-grown, EU-sourced bio-based products.

Speaking on behalf of the EUBA, Pekka Pesonen, Secretary General of Copa and Cogeca commented: ‘We are at a pivotal moment in the development of the European bioeconomy. The EU’s strategy is currently being reviewed and we find that we have both great achievements to celebrate as well as some much needed new measures to put in place. Financial tools are needed to boost innovation and investment in existing and new bio-based value chains. In addition, boosting public procurement of bio-based products is one example of how Europe can develop renewable product markets and accelerate the move towards a circular bioeconomy.’

Also speaking on behalf of the Alliance, Jamie Fortescue, Managing Director of Starch Europe, a member of the Primary Food Processors added: ‘Europe has, in abundance, the renewable resources, industrial base and know-how to lead its own bioeconomy revolution. What we now need, to attract more contributors and investment, is open and inclusive discussion underpinned by unwavering, cross-sectoral, political commitment. We want to look back at Utrecht in five years’ time and marvel at what has been achieved in the interim.’

EUBA member EuropaBio’s Industrial Biotech Council Chair, Stephan Tanda, concluded: ‘With the steadfast support and leadership of the European Institutions, the Member States and their regions, huge progress has been made over the past five years with many national authorities setting out their own tailor-made roadmaps towards vibrant and regenerative home-grown bioeconomies. In addition, thanks to the development and launch of the EU’s first ever Bio-based Industries Joint Undertaking for €3.7 billion, ground-breaking cross-sectoral innovation has been given a new lease of life. As a result, we will see new partnerships forming across borders and disciplines in the development of smarter, more sustainable products and processes. The potential is there to be harnessed and, with the right support, Europe will lead the way in the development of a world leading bioeconomy.’

Note to the Editor

BioEconomyUtrecht2016 is taking place 12-13 April in Utrecht, the Netherlands, and is hosted by the Dutch Ministry of Economic Affairs and the European Commission, under the auspices of the Dutch EU Presidency. The aim of the conference is to explore how Europe can enhance its bioeconomy and input into the review of the European Bioeconomy Strategy that will take place in 2016.

Commission Expert Group for Bio-based Products, Working Group Public Procurement of Bio-based Products, Recommendations 2016:
http://ec.europa.eu/growth/tools-databases/newsroom/cf/itemdetail.cfm?item_id=8767

Innovating for Sustainable Growth: A bioeconomy for Europe: http://ec.europa.eu/research/bioeconomy/pdf/bioeconomycommunicationstrategy_b5_brochure_web.pdf
 

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Position paper | 14 Mar.2016

EU Bioenergy Sustainability Criteria

The sustainable forest management framework has evolved and strengthened over time balancing a market based demand for wood products and bioenergy with the other environmental and climate functions of the forest.


More recently, the EU policy framework to support the use of energy from renewable sources has led to a strong increase of bio-energy use within short timeframes. The increased demand has led to rising imports of wood. To ensure the sustainability of the policy induced increase of bioenergy use and wood imports, the following issues have to be considered:
• Do the needs for wood biomass lead to any of the following critical consequences: resource depletion, land conversion, negative impacts on biodiversity?
• Is the direct burning of wood biomass an efficient use of a raw material that could first be used for higher value purposes?
• How could monitoring, reporting and verification ensure carbon sustainability?

To address the increased use of wood for energy and to design a sustainable biomass policy framework for the post 2020 period, CEPI believes that the following criteria for the production of bioenergy counting towards EU renewable energy targets should be considered while taking into account the use of existing legal and market based instruments at national, EU and global level.

1. Biomass sourcing

Biomass should come from sustainable sources. Biomass is a renewable source of energy if it does not lead to harvesting beyond the sustainable level and preserves the other functions of forests according to the principles of Sustainable Forest Management (SFM).

a. Carbon sustainability:

Forest biomass shall come from countries with credible LULUCF accounting and reporting. If biomass is procured from non-LULUCF accounting countries, credible proof has to be given that there are systems for monitoring, reporting and verification in place ensuring that the harvesting rate in this country is below 100% in the long term and the biomass does not come from land conversion (leading to depletion of carbon stock). Where there is overharvesting at the country level, the energy producer has to give sufficient proof that there is no overharvesting at the relevant regional level of the biomass origin.

Reporting should continue to take place according to the instant oxidation principle. This ensures that the climate effect of the wood use is allocated to the country in which the forest is harvested.

b. Forest management

Forest biomass shall come from legal sources.
In order to ensure that the three main challenges relating to forest management – resource depletion, land conversion and loss of biodiversity – are addressed, the following trend indicators provide sufficient assurance:
1. Growing Stock: The felling rate (harvested volume/net annual increment) must be lower than 1 in the long term (information source: e.g. National Forest Inventories) in order to avoid overharvesting.
2. Gross Deforestation: The area under forest cover must be maintained (except if deforestation is the result of “land sealing” (infrastructue building, urban expansion, etc. which is limited in surface) (information source: e.g. NFI)
3. Biodiversity: No biomass harvesting can take place in protected forests, unless the protection decision allows management and harvesting.
Additional considerations on the proposed approach:
• The measurement of meeting the above indicators must take place within well defined spatial and time dimensions. As far as the spatial dimension is concerned, the country level is relevant. Choosing the appropriate spatial level will allow for robust reporting and monitoring, both in terms of carbon emissions and removals (LULUCF reporting), as well as in terms of forest inventory (fellings areas, etc.)
• A stand level and short-term horizon is not acceptable as it would make compliance with such indicators both impossible and irrelevant. Harvesting lowers the carbon storage in stand level for a certain period, but at the same time at the landscape level, carbon storage continues to be maintained or increased.

Verification:
• The obligation of proof should be solely with the energy producer.
• Demonstrating compliance should be credible, but not too burdensome to the suppliers and the buyers. Red-tape leading to extra cost would be a disincentive to additional mobilisation of forest resources.
• Similar to the EU Timber Regulation an approach of risk assessment (via national/regional (where relevant) data according to the three indicators outlined) should be investigated. Only if the risk assessment at country level can not give thourough proof, the regional/landscape level should be adressed.
• New means of proof should avoid being a further burden when competing with other industries and products based on fossil and more carbon intensive raw materials as well as with forest industries based outside Europe.
• The tools developed by the forest sector should be used to proof the origin from sustainable sources along the chain of custody.
• In that context, different voluntary instruments and tools addressing forest management should be evaluated and recognised.

 

2. Biomass conversion

a. Greenhouse Gas Savings criterion:

There should be GHG savings compared to the average European fossil fuel based generation of electricity and heating and cooling.

• The GHG emissions reduction criteria should be based on the GHG emissions calculations methodology recommended by the Commission in 2010 (COM(2010)11) and confirmed in 2014 (SWD(2014)259).
• There should be coherence with the biofuels GHG emissions threshold (60%) as wood can be used to produce power, heat or biofuels.
• The methodology and default values should be established for at least the same period as the post-2020 RES target.

b. Conversion efficiency:

Heat and electricity based on solid and gaseous biomass should be produced at an overall efficiency of at least 70% (lower for small installations (e.g. < 1 MW) or where CHP cannot be applied). Member States should not support but further even avoid the use of biomass in new conversions of coal plants with the current low efficiencies. Supporting co-firing of biomass in coal plants at low efficiencies is an environmentally harmful subsidy.


Verification:

Meeting the conversion efficiency and GHG savings criteria should be verified by schemes similar to biofuels sustainability criteria. The obligation of verification should be with the energy producer. Mutual recognition of schemes should be ensured to limit red tape.

A background paper accompanying the position can be downloaded here.

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Position paper | 11 Feb.2016

Consultation on the Review of Directive 2012/27/EU on Energy Efficiency

This consultation was launched to collect views and suggestions from different stakeholders and citizens in view of the review of Directive 2012/27/EU on energy efficiency (Energy Efficiency Directive or EED), foreseen for the second half of 2016. The full consultation replies can be found here.

Here are some highlights:

In reviewing the EU energy efficiency target for 2030, the Commission should have in mind that energy efficiency has to be achieved by voluntary initiatives, rather than by mandatory requirements. An EU-wide binding energy saving target until 2030 would limit the scope for economic room to manoeuvre. A rigid objective as a binding cap on energy consumption would impede growth. Therefore, it is of vital importance that the Commission designs the target in such a way that recognises early measures and focuses on lowering the energy intensity, not the energy use as such. The European framework has to create ideal long-term conditions to realize energy efficiency measures covering all sectors. This is particularly important for the non-ETS sectors, where incentives to improve energy efficiency are often insufficient. Effective incentives are needed, especially for research and development as well as for the cost-efficient implementation of investments in energy efficiency measures.

In view of achieving the new EU energy efficiency target for 2030, we believe that energy efficiency work must be done locally and as close to the energy consuming unit as possible. The role of the EU should therefore only be limited to setting targets, creating the overall regulatory framework, monitor the process in terms of energy efficiency improvements and give non-binding advice to those countries that are not able to reach the given goals. But details on how to implement energy efficiency policies need to be formulated at national or even industry level.
The EU should also promote and finance research and innovation in the field of energy and process technology to enable breakthrough technologies.

Regarding the most appropriate financing mechanisms to significantly increase energy efficiency investments in view of the 2030 target, it is important to find a high efficient way of financing. To make sure that the highest possible potential is tapped with the available amount of money, it is important to prefer energy investment funding for measures with high returns on investment. One way would be to support investment in form of cheap call money from a revolving fund for efficiency measures that would otherwise not take place without support. Ensuring that the invested money always returns to the fund (e.g. oney is paid back to the fund in the same rate as the energy savings pay back), allows multiple use of the available budget and therefore enables highest efficiency.
Interest-free loans to finance investments are also a way to achieve energy efficiency measures.
Tax decrease/benefit could also be envisaged if companies are participating in energy efficiency programs and achieving results.
Income from auctioning of emission rights should also be used to finance energy efficiency measures.

 

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publications | 04 Apr.2016

Paper for Recycling Quality Control guidelines

The European Standard EN 643, European list of standard grades of paper and board for recycling, is the basic document to be used by industry professionals in the buying and selling of paper for recycling. Interested parties should order the EN 643 from their respective national standardisation body . The standard was revised in 2013. It defines what the different grades of paper for recycling can and cannot contain as well as defining prohibited materials and unwanted materials. It also sets maximum tolerance levels by grade for unwanted materials.

Specific agreements between buyer and supplier for grades with special specifications might still be necessary to meet individual requirements. However, general recommendations are needed to facilitate a common understanding of the standard.

To achieve greater harmonisation, to improve the implementation of the EN 643 Standard and to facilitate commercial relationships between paper mills and paper for recycling suppliers, these guidelines contain recommendations regarding paper for recycling quality controls for paper for recycling suppliers and paper mills.
 

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publications | 02 Mar.2016

Design and Management for Circularity – the Case of Paper

The European paper industry was invited to collaborate with the World Economic Forum (the Forum), the Ellen MacArthur Foundation and the McKinsey Center for Business and Environment on Circular Economy to produce a white paper with guidelines on design and management for circularity. The new publication provides essential guidance to all actors in the supply chain through simple ecodesign rules for paper products, without limiting innovation and the introduction of new techniques. This is a product of the three pilots under Project MainStream, launched during the 2014 summit in Davos.

Although highly recyclable, paper is usually converted by industries that add chemicals to it through printing inks and other auxiliary materials. This can lead to problems in subsequent circular chains, as these chemicals cannot easily be removed from the paper before re-entering the mill. Furthermore, the already highly-optimised recycling process cannot follow the speed of the evolution of inks and toners.

The publication summarises the key choices to be made by direct (printers, papermakers, collectors) and indirect (such as local authorities, ink producers, equipment manufacturers) stakeholders. More specifically, it identifies the choices that can influence businesses ordering a fibre-based product - printed paper, packaging or other.

Read the press release on the topic.

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