 There was a time in the not-too-distant past when the primary energy concern in the paper industry was contracting outside fuel purchases at the lowest prices. In many cases, that meant finding suppliers with good quality coal (high BTU content per unit purchased). I can recall routinely measuring the thermal and ash properties of coal samples in the laboratory, with the goal of monitoring various suppliers and obtaining rebates if the quality fell below an established minimum. But today, coal is rapidly shrinking as a purchased fuel in the United States, largely due to environmental constraints on fossil fuels. Major suppliers of coal are now either declaring bankruptcy or merging, and conversion to natural gas fired boilers for steam and electricity are occurring at increasing rates. According to the EPA, the U.S. pulp and paper industry consumes over $7 billion worth of purchased fuels and electricity each year. It is apparent that any shift in fuel trends will have a major impact on operating costs and profits. In addition, the shift in energy source mix comes with increased volatility, as even the price of coal can change rapidly.
We have all heard that there is an abundance of natural gas, and the fracking technologies now used have helped significantly to hold the price of the product down. It is estimated that natural gas currently accounts for over 40% of fuel purchased in North America, so in the short term, the trend has been positive for our industry. However, the price of oil has also declined, creating more competition with natural gas. This has currently resulted in a leveling off of natural gas prices, and has placed pressure on some of the highly leveraged fracking operations, even forcing shutdowns in some instances. With a decline in natural gas production, pricing will gradually increase. In addition, the price of oil will trend upward with world-wide demand, since much of the production remains under the control of Middle East suppliers. Overall, in my opinion, these trends will be negative for the U.S. pulp and paper industry.
Not everything related to energy trends is negative for the pulp and paper industry. The U.S. paper industry is reportedly the largest self-generator of electricity in the manufacturing sector. Two of its by-products, black liquor and "hog" fuel (bark, residue, etc) can be used to offset over 50% of the fuel purchased. In fact, the industry is a leader in producing energy from biomass sources. Of all the renewable energy alternatives, the largest potential contributor technically at this time is biomass. For example, biomass can be used directly to generate energy from steam driven turbines. The trend from greater use of biomass and systems with increased efficiency is very positive. Limitations include access to sufficient biomass residues and having the capacity to store raw material in large quantities. But growth is continuing in the production of bio-fuels such as ethanol, synthetic crude, and biodiesel. The paper industry should be prepared to participate in these newer manufacturing technologies.
Fossil fuel consumption on a global basis will continue to increase, because of world-wide industrial production growth. This directly influences industrial energy usage, which is estimated to be increasing over 2% per year. And control of paper industry water usage is becoming more critical. Not only are water costs increasing, but the use of water is also directly tied to the overall energy usage in the mills. The trend will be to pay increased attention to more energy- efficient motors, properly sized pumps, and pumps with adjustable speed drives throughout the process. Another highly important influence is process steam requirements. This is by far the largest end use of energy in the industry, and consequently the efficiency of steam-using equipment must be examined more critically. Increased boiler efficiency and correction of insulation deficiencies will continue to be important requirements. The expected trend in this sector will be a growth in combined heat and power (CHP) systems in the mills. Analytical methods such as Pinch Analysis may become more useful in identifying and correcting limiting constraints to efficiency improvements.
Of course, there are other alternative energy sources in addition to the biomass potential. Whether these, which include solar, wind, and geothermal, will provide an attractive payback in specific mills will need to be determined by project studies. While these sources may not currently supply a large portion of the mill's energy requirements, renewable energy is steadily trending upward globally. Solar energy use will be increasingly integrated into both the mill processes and building systems. For example, it may be feasible to use solar to heat make-up water for washing and cleaning, to reduce heating/cooling system costs, or to eliminate electricity purchased for total mill lighting. Surprisingly, lighting reportedly can require up to 4% of the total electricity used in some mills. The rate of conversion to solar systems will depend on justifying high initial capital costs, having the required space for cell banks, and the mill location. However most renewable energy use is being driven by environmental regulations on fossil fuels and these may become even more stringent in the future. The imposition of carbon taxes on emissions would significantly affect mill profitability, and in many cases could require installation of more expensive environmental control systems.
Since both the demand and cost of energy are projected to increase, the importance of energy conservation measures will become even more important in the future. While many mills have done an admirable job in conserving energy, the trend increasingly will be to use specialized and reputable energy audit professionals to pinpoint sources of potential energy savings. In addition, mill-staffed energy teams will be used more to justify and/or complete related project assignments. Since the savings from conservation generally provide a much quicker payback than new system installations, focusing on this area cannot be overlooked.
Robert Moore is a retired chemical engineer, and is an experienced technical and fictional writer. His past work experience spanned the chemical, paper and equipment manufacturing industries, including holding management positions at Voith Paper, Scapa plc, and The Mead Paper Corporation. He is also the author of humorous short stories about life in southwest Virginia, circa 1940-1960.
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