How does China's paper industry respond to the challenge of "dual carbon" goals
April 13, 2023
The proposal of the "dual carbon" goal is not only a solemn commitment made by China as a responsible global power to address climate change, but also a necessary path to promote the development of a community with a shared future for mankind and the construction of ecological civilization, and to achieve high-quality development. On the one hand, the paper industry is a traditional carbon emitter, with carbon emissions second only to high energy consuming industries such as electricity, petrochemicals, chemicals, building materials, steel, and non-ferrous metals; On the other hand, the entire industrial chain of the paper industry has the characteristics and potential of a low-carbon industry, such as carbon sequestration and recycling of raw material bases, carbon sequestration and recycling of products, and resource utilization of organic waste.
The proposal of the "dual carbon" goal is not only an unprecedented challenge for the paper industry, but also a once-in-a-century important opportunity to promote high-quality development and green upgrading of the industry. Starting from the background of the proposal of "dual carbon" and combining with the current development characteristics of China's paper industry, this article elaborates and analyzes the advantages and main problems of the industry in achieving the "dual carbon" goal. Furthermore, it proposes strategies such as strengthening the construction of raw material bases, adjusting the structure of raw materials and products, adjusting the energy structure, and actively participating in carbon emissions trading, providing reference for the green development of China's paper industry under the "dual carbon" goal.
Background and effectiveness of the "dual carbon" goal
(1) The impact of climate change
In the natural carbon cycle process, although the amount of carbon dioxide produced by human activities is far less than the natural process, it breaks the natural carbon cycle process. Especially since the Industrial Revolution, people have been indiscriminately logging forests to expand their land, coupled with the excessive use of fossil fuels, resulting in a rapid and significant increase in the concentration of carbon dioxide in the atmosphere. Research shows that for every doubling of carbon dioxide concentration in the atmosphere, the global average temperature will increase by about 2.3 ℃. Based on this prediction, if appropriate measures are not taken to cope with the increase in greenhouse gas concentrations, the global average surface temperature will increase by 2.3~5.2 ℃ compared to before the industrial revolution by the end of the 21st century, and the resulting extreme weather will have a huge impact on the lives of people around the world.
(2) The Course and Achievements of Dealing with Climate Change
In order to avoid risks caused by climate impacts, human society has also taken positive actions in recent years, mainly through carbon neutrality, namely reducing carbon emissions and increasing carbon sinks, to achieve zero net carbon emissions from human activities. At present, carbon neutrality strategies agreed by the international community mainly include: reducing the use of fossil energy (fuels, materials and chemicals), reducing the use of carbonate materials, saving energy, increasing forest land and wetlands, and collecting, utilizing and storing carbon; Ultimately, it replaces most fossil fuels in fields such as energy, chemicals, and materials, and achieves net carbon zero emissions from human activities by increasing carbon sinks and utilizing storage.
In order to achieve carbon neutrality, carbon peaking is the only way. At present, developed countries have completed the stage of industrial development by the end of the 20th century, and have already achieved carbon peak more than 20 years ago. Based on this, many developed countries have clearly proposed a carbon neutrality timetable. For example, the EU, the UK, Norway, Canada, Japan and other countries set the time node of carbon neutrality at 2050.
Although China is a developing country, it still follows the path of low-carbon development. This is driven by both external environmental pressure and the driving force of sustainable development. As early as 1992, China participated in the United Nations Framework Convention on Climate Change as one of the first contracting parties. In 2009, the Standing Committee of the National People's Congress passed the Resolution on Actively Responding to Climate Change, which proposed the need to abandon the original extensive development model, adjust the energy and industrial structure based on national conditions, develop a green and low-carbon economy, and take the path of sustainable development. These two documents provide the top-level design and overall deployment for China's "dual carbon" work.
The Development Status, Trends, and Challenges of the Paper Industry
(1) The Current Situation of China's Paper Industry
According to data released by the China Paper Industry Association, in recent years, the production of pulp, paper, and cardboard in China has been increasing year by year, with a tight balance between supply and demand. Among them, in 2021, there were approximately 2500 paper and cardboard production enterprises nationwide, with a national paper and cardboard production volume of 121.05 million tons, an increase of 7.50% compared to the previous year; The consumption was 126.48 million tons, an increase of 6.94% compared to the previous year, with a per capita annual consumption of 89.51 kilograms (1.413 billion people). From 2012 to 2021, the average annual growth rate of paper and cardboard production was 1.87%, and the average annual growth rate of consumption was 2.59%.
At present, there are more than 2400 paper production enterprises in China, with a total annual revenue of 855.1 billion yuan in 2021; The growth rate of industrial added value is 8.00%; The inventory of finished products reached 41.8 billion yuan, a year-on-year increase of 33.33%; The total profit was 54.1 billion, a year-on-year increase of 17.01%; The total assets reached 1074.8 billion, a year-on-year increase of 5.37%; Asset liability ratio 58.88%; The total liabilities amounted to 632.8 billion yuan, a year-on-year increase of 5.59%; Among the more than 2400 paper production enterprises counted, 452 suffered losses, accounting for 18.63%. From the perspective of enterprise structure, over 75% of paper production enterprises are small and medium-sized enterprises.
From the perspective of energy institutions, the energy consumption of the paper and paper products industry in 2019 was 38.47 million tons of standard coal, a decrease of 17.19% compared to 2009, and its proportion in the total national energy consumption decreased from 1.39% to 0.79%. On the premise of continuous growth in pulp and paper production, the industry's energy consumption and its proportion in the total national energy consumption have significantly decreased. From the perspective of energy structure, in 2019, coal consumption in the industry accounted for 83.61%, natural gas consumption accounted for 11.06%, and coal consumption accounted for absolute advantage.
(2) Development Trends of China's Paper Industry
In recent years, taking the path of green and low-carbon development has deeply rooted in people's hearts. As a traditional energy consuming and polluting industry, the paper industry is also actively transforming, with challenges and opportunities coexisting.
Since 2014, China has included all waste paper varieties in the restricted import category. Since 2017, the central government has issued a series of relevant policies, restricting the import of solid waste through measures such as strengthening customs monitoring and raising import waste paper standards, improving the level of domestic resource utilization, promoting the development of the domestic waste paper recycling system, and gradually achieving zero import of solid waste. According to the regulations of the Ministry of Ecology and Environment, starting from January 1, 2021, China will prohibit the import of solid waste in any form, marking the official beginning of the era of "zero import" of solid waste in China.
In January 2020, the country released a plastic restriction plan. By the end of 2022, the consumption of disposable plastic products will significantly decrease. Before 2025, China will gradually restrict and prohibit the use of non degradable plastic bags, disposable plastic tableware, disposable plastic products for hotels and hotels, and plastic bags for express delivery.
The introduction of the ban on waste and plastic restrictions has brought revolutionary changes to the paper industry. On the one hand, the ban on waste has changed the history of relying on imported foreign waste as the main production raw material for cardboard boxes, forcing major domestic paper companies to turn to domestic waste, effectively improving the recycling and utilization rate of domestic waste; On the other hand, the plastic restriction order has also injected a shot of strength into the paper industry on the demand side. Currently, "replacing plastic with paper" has become a consensus in both policy and economic aspects of the industry.
(3) The Challenges Faced by the Paper Industry under the Background of "Dual Carbon"
In recent years, the production and consumption of paper and paperboard in China have significantly increased compared to the past, with per capita consumption reaching 89.5kg, which is higher than the world average of 52kg, but far lower than the per capita level of 170kg in G7 countries. According to the development goals proposed in the "14th Five Year Plan and Medium to Long Term High Quality Development Outline of the Paper Industry" released by the China Paper Industry Association, the total domestic production of paper and paperboard in China will reach 170 million tons by 2035, a net increase of 50 million tons compared to the current level, and the average annual consumption per person will reach 120kg.
The industry needs to continue to develop, but with the implementation of the policy of prohibiting the import of waste paper and the establishment of the "dual carbon" goal, the industry is facing challenges such as adjusting the raw material structure, transforming the energy structure, exploring the application of new technologies, and currently facing multiple challenges such as insufficient exploration of green attributes.
Response of the Paper Industry to the "Dual Carbon" Goal
(1) Strengthen regional integration and create industrial clusters
Currently, there are more than 2400 enterprises engaged in the production of paper and paperboard in China, the vast majority of which are small and medium-sized enterprises. These small and medium-sized enterprises have a significant gap compared to developed countries in terms of production scale, technology application, and profitability. According to relevant research, the production level of large and medium-sized enterprises, especially the level of clean production, has significant advantages compared to small and medium-sized enterprises. The comprehensive energy consumption per unit product can be reduced by about 36% compared to small and medium-sized enterprises. By strengthening regional integration and shutting down and transforming enterprises that do not meet the scale and technology standards, the competitiveness of the industry can be fundamentally improved, and energy consumption and carbon emissions can be reduced from the source.
(2) Adjusting energy structure and promoting clean energy
The overall consumption of paper in China will continue to increase before the national economy reaches a moderately developed country, in other words, the total energy consumption of the paper industry will continue to rise. In order to achieve the "dual carbon" goal as soon as possible and balance the contradiction between development and environmental protection, the paper industry should adjust its energy structure as soon as possible and change the current situation where coal is the main source.
According to the IPCC Guidelines for National Greenhouse Gas Inventories, the CO2 emission coefficients for coal, oil, and natural gas are 1, 0.818, and 0.593, respectively. This means that coal's carbon emissions are much higher than natural gas, and coal's emissions of pollutants such as smoke and dust are also much higher than those of oil and natural gas. Natural gas is superior to coal in terms of carbon source control and emission control costs. Taking Minsheng Bank's strategic client Jiulong Paper Industry as an example, it has introduced natural gas as an alternative to coal as energy source in its largest production base (Dongguan), and is expected to be fully updated by 2025.
In addition to natural gas, clean energy sources such as solar energy, wind energy, and biomass do not generate carbon emissions during their use, which also provides broader space for future energy structure adjustments in the paper industry. The papermaking industry is currently one of the largest industries in the world in terms of large-scale utilization of plant fiber resources, with mature technologies and basic conditions for biomass energy utilization. At present, some leading enterprises in the industry have actively engaged in the application of biomass energy. For example, Sun Paper Industry has built alkali recovery furnaces to strengthen waste incinerators for cogeneration through technology application, and all biomass resources such as bark, sawdust, waste residue, and sludge generated during the production process are sent to the solid waste incinerator for heat recovery. This not only achieves the balance of heat supply in the entire plant, but also achieves the reduction of solid waste.
(3) Innovative technology application to improve energy efficiency
In the production process of the paper industry, the energy consumption intensity is relatively high. The "14th Five Year Plan and Medium to Long Term High Quality Development Outline of the Paper Industry" released by the China Paper Industry Association also points out that "we strive to reduce the actual comprehensive energy consumption of pulp per unit product in the paper industry from 350kgce/t to 320kgce/t, and paper and cardboard from 480kgce/t to 450kgce/t, reaching a relatively advanced international level". So in the long-term context of adjusting the energy structure, how to improve energy efficiency has become an urgent priority at present.
At present, the papermaking industry has attempted the application of new technologies in key production links and achieved significant results. For example, Minsheng Bank's strategic customer Jiulong Paper has equipped advanced white water recycling systems in all production lines, which not only effectively reduces the generation and discharge of a large amount of wastewater, but also to some extent solves the water resource consumption in the production process; For example, a certain enterprise's paper machine drying department uses a closed hood to recover the heat and moisture of the evaporated water vapor during the paper drying process, increasing the supply air temperature and reducing energy consumption; The use of bag ventilation technology can increase the drying capacity of the paper machine by 10-20%, and the average speed of the paper machine can be increased by 10%. By replacing traditional water ring vacuum pumps with turbine fans, the energy consumption of the vacuum system can be reduced by about 33%.
In addition to optimizing the existing process flow, the paper industry still has a certain potential for energy recovery based on industry characteristics. Taking the process from pulping to papermaking as an example, the required temperature generally decreases step by step. Under conventional conditions, this type of wastewater needs to be cooled before undergoing biochemical treatment. By using heat pump technology, a small amount of electricity or fossil energy is consumed to recover the low-temperature waste heat of the wastewater, while reducing the energy consumption of the cooling process and achieving dual benefits. The promotion and application of advanced production methods such as these can greatly improve the energy efficiency in the papermaking production process.
(4) Explore industry advantages and participate in forestry carbon sequestration
The paper industry has a natural green attribute, and as the upstream of the paper industry, forestry can not only be used as raw materials, but also as a carbon sink resource for forestry development. Forests are the largest carbon sink in terrestrial ecosystems, playing a crucial and unique role in reducing greenhouse gas concentrations in the atmosphere and mitigating global warming. Through forestry management activities such as forest protection, wetland management, desertification control, afforestation (tree and bamboo forests), forest management (tree and bamboo forests), and harvesting forest products management, carbon sequestration in vegetation and soil will be stabilized and increased. Carbon sequestration can be monitored, measured, and certified before participating in carbon trading.
Considering that China is still a country lacking in forests and greenery, with fragile ecology, the forest coverage rate is far below the global average of 31%, and the per capita forest area is only 1/4 of the world's per capita level. So under the "dual carbon" goal, we should not only promote the planting scale of domestic fast-growing forests through the paper industry, but also actively prepare and participate in carbon trading, and gradually establish and improve a carbon management system, managing carbon quotas as an asset, and effectively promoting the achievement of the "dual carbon" goal and green upgrading of the industry through carbon emission trading.
In 2020, although the total energy consumption of the paper industry only accounted for 1.23% of China's total energy consumption, its emission intensity was only second to high energy consuming industries such as electricity, petrochemicals, chemicals, building materials, steel, and non-ferrous metals. Therefore, in the context of the "dual carbon" goal, the paper industry should start from capacity integration, energy structure adjustment, improving energy efficiency, and participating in forestry carbon sequestration to study and formulate low-carbon and low-carbon development strategies, Simultaneously balancing industry development and achieving sustainable development.
