First public consultation of ACT Pulp & Paper Methodology - Long version. Accepting comments until July 9, 2021

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Pulp and Paper

Methodology

(Version 1.2 | June 2021)

 

© CDP Worldwide & ADEME 2021. Reproduction of all or part of work without license of use permission of CDP Worldwide & ADEME is prohibited.

 

 

1. Introduction

 

1.1 Context for Pulp and paper sector

The 2015 United Nations Climate Change Conference (COP21) in Paris solidified the global recognition to act on climate change with the political agreement to limit warming to a 2°C pathways, and if possible, a well below 2°C above pre-industrial levels. The ‘Assessing low-Carbon Transition’ (ACT) Initiative measures a company's alignment with a future low-carbon world. The goal is to drive action by companies and encourage businesses to move to a well-below 2°C compatible pathway in terms of their climate strategy, business model, investments, operations and GHG emissions management. The general approach of ACT is based on the Sectoral Decarbonization Approach (SDA) developed by the Science-Based Targets initiative (SBTi) using International Energy Agency (IEA) data in order to compare a company’s alignment with a well-below 2°C world, the application of which is described in the ACT Framework. The ACT Pulp & paper methodology aligns with other reporting frameworks where applicable (e.g. CDP, TCFD, EU Taxonomy).

The pulp and paper sector has an important role to play in the global decarbonization and thus represents an interesting target for ACT. In 2014, the sector consumed 5.6% of the total energy required by the industrial sector. Although energy efficiency measures already contributed to a GHG emission reduction of the sector, additional efforts are needed to be on track with the Paris mitigation objectives. Energy efficiency measures are needed for energy intensive steps such as wood chipping, heating through boilers during the pulping process or drying during the paper-making stage.

The main challenges for the sector include increasing the use of recycled fiber coupled with the decarbonization of the energy used for the industrial processes, ensuring the sustainability of the wood used as a primary input and exploring new business models such as the development of products with alternatives fibers or substituting plastics.

 

2. Principles

The selection of principles to be used for the methodology development and implementation is explained in the general ACT Framework [1]. Table 1 recaps the principles that were adhered to when developing the methodology.

Table 1: Principles for implementation

Relevance - Select the most relevant information (core business and stakeholders) to assess low-carbon transition.
Verifiability - The data required for the assessment shall be verified or verifiable.
Conservativeness - Whenever the use of assumptions is required, the assumption shall err on the side of achieving a 2° maximum global warming.
Consistency - Whenever time series data is used, it should be comparable over time.
Long-term orientation - Enables the evaluation of the long-term performance of a company while simultaneously providing insights into short- and medium-term outcomes in alignment with the long-term.

 

3. Scope

 

3.1 Scope of the document

This document presents the ACT assessment methodology for the Pulp and Paper sector. It includes descriptions of indicators alongside their calculation methods and rationale for the sector-specific aspects of performance, narrative and trend scorings. It was developed in compliance with the ACT Guidelines for the development of sectoral methodologies [2]. It is intended to be used in conjunction with the ACT Framework, which describes the overarching philosophy of the ACT Initiative and elements of the methodology that are not sector specific.

 

3.2 Scope of the Pulp and paper sector

 

3.2.1. Pulp and paper sector value chain

 

The pulp and paper sector value chain can be divided into 11 main economic activities:

  • Forest tending and harvesting
  • Woodchip production (wood sorting, debarking and chipping), which is most often performed by pulp mills, and sometimes by sawmills
  • Non-fibrous material production (chemicals, additives, clays, starches, fuels, etc.) to be used for pulp production, paper and board manufacturing, and paper and board converting
  • Pulp production
  • Paper and board manufacturing
  • Paper and board converting
  • Paper and board waste collection
  • Waste sorting
  • Waste disposal / incineration
  • Pulp production based on waste paper and board (recovered fiber pulp)
  • Transportation of materials between each stage.

The different phases of the value chain are presented in the figure below. The figure also illustrates the specific phases providing the inputs to the manufacturing process in the form of a) raw materials (fibrous and non-fibrous material) and b) used material (paper and board for recycling) through waste collection and sorting.

 

Figure 1: Economic activities and related players along the pulp and paper value chain

 

 

3.2.2. Scope of the Sector

The category “scope of the sector” defines the types of companies operating within the pulp and paper value chain that can be assessed using the ACT Pulp and Paper methodology.

The two following criteria were used to define which types of companies were included within the scope of the sector:

  1. The company has at least one activity where the main income is derived from the sale of a raw material used to make pulp and paper, or an article of paper or board
  2. The company has significant direct emissions from their processes (more explanation on how the significance of emissions was determined is given throughout the methodology).

As a result of these criteria being implemented, and as shown in Figure 2 below, the companies that are part of the scope of the sector are:

  • Integrated paper and board companies
  • Semi-integrated paper and board companies
  • Pulp companies
  • Paper and board manufacturers
  • Paper and board converters.

The ACT methodology defines an integrated paper and board company as a company performing the three following activities: pulp production, paper & board manufacturing, and paper & board converting, and, in addition, operating at least another activity (e.g. forest tending and harvesting, transportation, etc.) within the pulp and paper value chain.

A semi-integrated paper and board company is defined as a company performing the three following activities: pulp production, paper and board manufacturing, paper and board converting.

 

Figure 2: scope of the sector

 

 

3.2.2.1.Rationale for the exclusion of some players in the value chain from the scope of the sector

 

The following Table 2 provides a list of all players in the value chain, together with an indication of whether they are included or excluded from the scope of the sector, and the rationale for their exclusion.

Table 2: Overview of the scope of the sector

Companies that are excluded from the scope of the sector, and that are not covered by another ACT sectoral methodology, can be assessed with the ACT Generic methodology.

 

3.2.2.2. Categories of companies within the scope of the sector

Figure 3 below presents the different categories of companies from the pulp and paper sector that are included in the scope of the sector, as well as the activities they cover.

 

Figure 3: Categories of companies included in the scope of the sector

 

3.2.2.3. NACE codes / ISIC codes

The NACE codes enable a clear definition of the scope of the sector. Companies operating at least one facility that is classified with one of the following NACE codes can be assessed with the ACT Pulp and Paper methodology:

  • 17.11 Manufacture of pulp
  • 17.12 Manufacture of paper and paperboard
  • 17.21 Manufacture of corrugated paper and paperboard and of containers of paper and paperboard
  • 17.22 Manufacture of household and sanitary goods and of toilet requisites
  • 17.23 Manufacture of paper stationery
  • 17.24 Manufacture of wallpaper
  • 17.29 Manufacture of other articles of paper and paperboard.

Companies performing activities that are within the pulp and paper value chain (with at least one in the scope of the sector) and activities that are out of it can still be assessed with this ACT Pulp and Paper methodology. However, please note that the assessment will solely focus on the activities that are listed above.

The Figure 4 below displays the NACE codes, and their ISIC equivalents, defining the activities that are within the scope of the sector. As explained above, NACE Division 18 “Printing and reproduction of recorded media” is excluded from the scope of the sector and is greyed out in the figure.

 

Figure 4: NACE Codes and their ISIC equivalents

 

 

4. Boundaries

The boundaries are defined as the main GHG emission sources along the value chain that are included in the ACT Pulp and Paper methodology.

 

QUANTITATIVE AND QUALITATIVE ASSESSMENTS

The strategy and actions implemented by companies to reduce these GHG emission sources are assessed either quantitatively or qualitatively by the methodology. GHG emissions are assessed quantitatively when a global low-carbon scenario exists and meets the criteria to be used as a relevant benchmark. Due to current lack of guidance and low-carbon scenarios on reporting emissions from land-use, land-use change and forestry which are currently being developed by the GHG Protocol [5] and by the Science-Based Targets initiative [6], some GHG emission sources will not be assessed quantitatively. A qualitative approach using maturity matrices, with several levels of performance and their respective criteria, will be created to evaluate the carbon performance of the assessed company.

Moreover, as the pulp and paper sector can play an important role in maintaining or increasing carbon sinks through sustainable forest management practices, carbon dioxide removals will be assessed qualitatively through an indicator on sustainable forest management in the Sold Product Performance module. Once published, the forthcoming guidance on carbon dioxide removals from the GHG Protocol might enable a quantitative assessment to be included in a future update of the ACT Pulp & Paper methodology.

 

4.1 GHG emission sources included in the boundaries

To cover relevant GHG emission sources and to facilitate the data collection on the companies’ side, the ACT methodology focuses on the largest GHG emission sources throughout the value chain. These are included in the boundaries if the two following criteria are fulfilled:

  • Significant climate impact (more explanation on how the significance of emissions was determined is given throughout the methodology).
  • At least one player within the scope of the sector has a minimum level of control, and thus levers to reduce them.

More explanations on how the boundaries have been defined and how biogenic carbon storage in the final product, avoided emissions and carbon dioxide removals are addressed in the ACT methodology framework can be found in Annex.

 

Figure 6: Boundaries of ACT Pulp and Paper methodology

 

Rationale for the inclusion/exclusion of the GHG emission sources in the boundaries.

Table 3 - rationale for the inclusion of the GHG emission source in the boundaries

(2) Woodchip production is responsible for around 9% of GHG emission along the virgin fiber value chain according to the studies. As this activity can performed by pulp mills, the 9% share includes GHG emissions from pulp mills, and from sawmills (when outsourced)

(3) As the woodchip production is most often performed at the pulp mill, a share of the 9% of GHG emissions and land management carbon impacts along the virgin fiber value chain could be allocated to the pulp production stage

 

5. Construction of the data infrastructure

 

5.1. Data sources

In order to carry out a company level assessment, many data points need to be gathered which can be sourced from various locations. Principally, ACT relies on the voluntary provision of data by the participating companies. The data provided by the companies may be of different types. Alongside this, however, external data sources are consulted where this would streamline the process, ensure fairness, and provide additional value for verification and validation.

The ACT assessment uses the following data sources:

Table 4: ACT assessment data sources

Data source Main use
Company data from survey Data source for calculating indicators.
Company data from models and simulations Data source for calculating indicators.
Company data from life cycle assessment Data source for calculating indicators.
Company data from econometric data Data source for calculating indicators.
Contextual and financial information database sources (E.g. Online and press news, RepRisk) Contextual and financial information on company and events related to the company that could impact the ACT assessment

Where indicators use third-party data sources as the default option, reporting companies may provide their own data if they can provide a justification for doing so, and information about its verification status, any assumptions used and the calculation methodology.

 

5.2. Company Data request

The data request will be presented to companies in a comprehensive data collection format.

The CDP questionnaire can be a source of information for data collection. The ACT data collection form will highlight correspondence between requested data in the ACT Pulp and Paper methodology and the 2020 version of the CDP questionnaire. All data would be collected by the analyst or the company.

Each data point required is given a code of PP (to indicator Pulp & Paper) followed by two numbers (e.g. PP 2.1 – module 2, indicator 1).

 

5.3. Performance indicators

 

Maturity matrix:

Some modules are scored using a maturity matrix, as the assessment is qualitative. The maturity matrix contains five levels of evaluation that are associated to scores given to the company for each indicator. For some indicators, all 5 levels of the matrix are used to score the company, while for other indicators only some levels are used, in a simpler and less granular approach (ex: level 1, 3 and 5 only). Some of the indicators might be divided into sub-dimension that are evaluated individually before the score is aggregated to obtain the indicator score.

 

Modules and indicators:

Table 5 illustrates the performance indicators used by the Pulp and Paper sector analysis.

Table 5: Performance indicators overview

 

General comment for the TWG consultation : Some part of the methodology  are highlighted in yellow, because it is a provisional version. Those parts are still under discussion.

 

 

5.3.1. Targets (Weighting: 15%)

 

5.3.1.1 - PP 1.1 Alignment of emissions reduction targets (WEIGHTING: TBD%)

Description & Requirements PP 1.1 Alignment of emissions reduction targets
Short description of indicator A measure of the alignment of the company’s emissions reduction targets with its decarbonization pathway. The indicator will identify the gap between the company’s target and the decarbonization pathway by comparing the trend from the company’s emission reduction and the company benchmark.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2](4)
  • Company’s target and target year Variation of [C4.1a], [C4.1b]
  • For all existing and planned assets: Asset name, Geographic Location (country level), Plant type, Status, Total capacity (metric tonne), Production (metric tonnes of pulp and paper), Emissions factor (kg CO2e/tonne Pulp and Paper), Year of commissioning, Expected lifetime (years), Decommissioning or modernization year, if planned, Ownership stake (%), Attributable to reporting boundary (%)
  • % of emissions covered by the targets

(4) The details in the [ ] are the questions in the 2020 CDP Climate Change questionnaire

External sources of data used for the analysis of this indicator are:

  • IEA ETP [4] – background scenario data

For pulp producers, paper & board manufacturer and converters of paper & board, emissions from a restricted perimeter of scope 3 downstream or upstream emissions will be considered. The decarbonization pathway for scope 3 upstream or scope 3 downstream will be computed from IEA ETP data set.

  • For ‘Pulp producers’ : We will consider downstream scope 3 emissions corresponding to scope 1+2 emissions from paper & board manufacturer
  • For ‘Paper & board converters’ : We will consider upstream emissions corresponding to scope 1+2 emissions from ‘Pulp producers’ and downstream scope 3 emissions corresponding to scope 1+2 emission from ‘Converters of paper & board’
  • For ‘Converters of paper & board’ : We will consider upstream emissions corresponding to scope 1+2 emissions from scope 1+2 emissions from Paper & board manufacturer’.
How the Analysis will be done

The analysis is based on a trend ratio between the company’s Scope 1+2 emissions target (𝑇𝑆12) and the company’s Scope 1+2 benchmark (𝐶𝐵S12) .

The company’s target (𝑇𝑆12) is the decarbonization over time, defined by the company’s emissions reduction target. To compute T, a line is drawn between the starting point of the analysis (i.e. reporting year) and the company’s target endpoint.

The company benchmark (𝐶𝐵S12) pathway is the ‘company specific decarbonization pathway’. See section 6.1.1 for details on the computation of this pathway.

The indicator compares 𝑇𝑆12 to 𝐶𝐵S12, by assessing the difference between these pathways. The pathways are expressed in kilograms of CO2e per unit of activity (intensity measure). The unit of activity for Pulp and Paper sector is tonnes metric tonnes air-dry weight (with 10% moisture content)5 for pulp products and in metric tonnes for paper products. Where necessary, targets shall be normalized to this activity unit. The result of the comparison is the commitment gap.

To assign a score to this indicator, a ratio will be made between, as shown by the purple arrow in Figure 2 below.

 

Figure 2 : ALIGNMENT OF FUTURE TARGET WITH COMPANY'S BENCHMARK - COMMITMENT GAP

 

Calculation of score:

The score is calculated by dividing the company intensity reduction engagement by the specific benchmark emission intensity reduction between the reporting year and the target year through the trend ratio.

where EIc(Yt) is the company Scope1+2 emissions intensity at target year, EIc (Yr) is the company scope 1+2 emissions intensity at reporting year, EIb(Yt) is the company’s benchmark Scope 1+2 emission intensity at target year and EIb(Yr) is the company’s benchmark Scope 1+2 emission intensity at reporting year.

The commitment gap of the company is equal to (1- trend ratio). Thus, when the company’s target pathway is aligned on the company’s benchmark, the trend ratio is equal to 1 and the commitment gap is 0 (see Figure 1).

The score is calculated by dividing the company intensity reduction engagement by the specific benchmark emission intensity reduction between the reporting year and the target year through the trend ratio.

If the target coverage of total company emissions at reporting year (Cyr) represents more than 95%, the final score is equal to:

Otherwise final score of the indicator is equal to:

For integrated companies , scores obtained for each target will be aggregated by weighting proportionally to emissions that are covered by each target.

Rationale PP 1.1 Alignment of emission reduction targets
Rationale of the indicator

Relevance of the indicator:

Targets are included in the ACT assessment for the following reasons:

  • Targets are an indicator of corporate commitment to reduce emissions and are a meaningful metric of the company’s internal planning towards low-carbon transition.
  • A majority of emissions from the sector are within the sector boundaries of control, so those targets are a very powerful management tool to reduce them. Most emissions (around 80% of emissions) from the Pulp and Paper sector can be captured in targets using existing target-setting frameworks.
  • Targets are one of the few metrics that can predict a company’s long-term plan beyond what can be projected in the short-term, satisfying ACT’s need for indicators that can provide information over the long-term.

Scoring rationale:

Targets for each sub-sector are quantitatively interpreted and directly compared to the low-carbon benchmarks for the sector, using the company’s benchmark, build from the company’s current level of emissions at reporting year and converging toward the 2050 value of the sectoral benchmark relevant for this company.

NB: In previous ACT methodologies, the score was the result of the commitment gap calculation based on the difference between the company’s target and the company benchmark 5 years after the reporting year. At the time of redaction of ACT Pulp and paper methodology, this indicator is based on ratio between company’s relevant emissions targets and the company benchmark, in order to be better aligned with Science Based Target Initiative.

 

5.3.1.2 - PP 1.2 Time horizon of endpoint and intermediate targets (Weighting: TBD%)

Description & Requirements PP 1.2 Time horizon of endpoint and intermediate targets
Short description of indicator A measure of the time horizons of company targets. The ideal set of targets is forward looking enough to include a long-term horizon that includes the majority of a company’s assets lifetimes (lifetime of infrastructural assets such as furnaces and process machines), but also includes short and mid-term targets that incentivize action in the present.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2]
  • Company’s target and target year Variation of [C4.1a], [C4.1b]
  • For all existing and planned assets: Asset name, Geographic Location (country level), Plant type, Status, Total capacity (metric tonne), Production (metric tonnes of pulp and paper), Emissions factor (kg CO2e/tonne Pulp and Paper), Year of commissioning, Expected lifetime (years), Decommissioning or modernization year, if planned, Ownership stake (%), Attributable to reporting boundary (%)

The benchmark indicators involved are:

 

How the Analysis will be done

The analysis has two dimensions:

Dimension 1 : A comparison of: (a) the longest time horizon of the company’s targets, and (b) a relevant time horizon for the sector Lf . The relevant time horizon that will be considered here will be 30 and 60 years, line with the nature of the activities, as well as the life span of the relevant equipment, processes and products contributing to the company's activity (ex : default value of life time assets). For pulp and paper sector, the time horizon considered will be respectively 30 and 60 years for paper machines and pulp machines, as it is the maximum lifespan without upgrading.

Dimension 2 : An analysis of the company interval targets that ensure both short and long-term targets are in place to incentivise short-term action and communicate long-term commitments.

Aggregate score: Dimension 1 (50% weighting) + Dimension 2 (50% weighting)

Yearly CO2 emissions are defined as:

Dimension 1 - Target endpoint (50% of the score):

The company’s target endpoint (Te) is compared to the observed lifespan Lf before an upgrading of the machines for the Pulp and paper sector. If the data is not available, a default value will be provided.

The company’s target endpoint (Te) is equal to the longest time horizon among the company’s targets, minus the reporting year:

 

If the company is integrated, it can either:

  • Set targets by activity, and so a separate analysis is done for each activity: the target endpoint Te of the targets the company has set for the given activity is compared to the lifetime Lf of this activity.
  • Set aggregated targets and so Te is compared to the longest lifetime Lf. The horizon gap is used to rate the company on the time horizon relevance of its most long-term target.

The company’s target endpoint is scored according to the following scoring table:

 

Dimension 2 - Intermediate horizons (50% of the score):

For each sub-sector, all company targets and their endpoints are calculated and plotted. To get full score, the company must not have time gaps larger than 5 years between targets horizons, starting from the reporting year as baseline.

The company’s targets are compared according the following scoring table:

 

An example is illustrated in Figure 3.

Figure 3 : Examples of horizons of intermediate targets set by the company and corresponding scores on dimension 2 of the indicator 1.2

 

For all calculations:

In order to ensure a wide coverage of company’s emissions, targets that cover < 95% of scope 1 + 2 emissions of the company are preferred in the calculations. If these types of targets only are available, then the score is adjusted downwards equal to the % coverage that is missing. Figure 4 graphically illustrates emissions covered by the targets:

 

Figure 4 : Illustration of emissions covered by targets that are considered for calculation

 

 

Rationale PP 1.2 Time horizon of endpoint and intermediate Targets
Rationale of the indicator

Relevance of the indicator:

The time horizon of targets is included in the ACT assessment for the following reasons:

The target endpoint is an indicator of how forward looking is the company’s transition strategy.

Aside from communicating long-term commitments, short-term action needs to be incentivized. This is why short-time intervals between targets are needed.

Scoring rationale:

The score of this indicator is tied to how the target timeline compares to lifespan of assets between upgrading interventions, in pulp and paper sector.

 

5.3.1.3 - PP 1.3 Achievement of Previous and current targets (WEIGHTING: TBD%)

Description & Requirements PP 1.3 Achievement of previous and current targets
Short description of indicator A measure of the company’s historical target achievements and current progress towards active emissions reduction targets. The ambition of the target is not assessed here with this indicator.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2]
  • Company’s target and target year Variation of [C4.1a], [C4.1b]

For each target:

  • Base year
  • Start year
  • Target year
  • Percentage of reduction target from base year in absolute emissions
  • Percentage of reduction target achieved in absolute emissions.
How the Analysis will be done

For the performance score, this indicator is assessed on two dimensions, whereby companies achieve the maximum score if:

Dimension 1: The company has achieved all previous emissions reduction targets with a target year in the past 10 years. If all past targets are achieved, the highest score is obtained. If not, the achievement ratio a is computed as follows:

where E(tref) is the level of emissions of the company on the year the target was set,  T(thorizon)is the target the company set (a given level of emission at a given horizon year, now past), and E(thorizon) is the effective level of emission reached by the company on the year of horizon of the target.

A threshold is set for scoring at 0.5: if the company has achieved less than 50% of its own past target, it shall receive a zero score.

If the company has several past targets over the last 10 years, the ratio a shall be computed for each target, and the average of all a ratio shall be kept for scoring.

 

Dimension 2: The company is currently on track to meet an existing emissions reduction target, whereby the ratio between the remaining time period and the level remaining to target achievement (Progress Ratio p) is not lower than 0.5:

The highest score is attained if p is 1 or higher. A percentage score is assigned for any value between 0.5 and 1.

 

Aggregate score - Dimension 1: 25%, Dimension 2: 75%

For all calculations:

  • Companies which do not have targets with target years in the past but only with target years in the future are not assessed on dimension 1, but only on dimension 2.
  • Targets that do not cover >95% of ‘Scope 1+2 emissions’ are not preferred in the calculation of dimension 2, but are not penalized, as other indicators already penalize for not having a large coverage in the target.
  • If the company has multiple targets in different scopes that can be assessed according to the above criteria, then the score is an average score based on the progress ratios of all targets assessed.

The performance score does not assess the ambition level of previous targets, and therefore dimension 1 has only a low weight in the final performance score. This information is also qualitatively assessed in the narrative analysis, which will take another look at the following dimensions:

  • Achievement level: To what degree has the company achieved its previously set emissions reduction targets?
  • Progress level: To what degree is the company on track to meet its currently active emissions reduction targets?
  • Ambition level: What level of ambition do the previously achieved emissions reduction targets represent?
Rationale PP 1.3 Achievement of previous and current targets
Rationale of the indicator

Relevance of the indicator:

The historical target ambition and company performance is included in the ACT Pulp and Paper assessment for the following reasons:

  • The ACT assessment looks to the past only to the extent that it can inform on the future. This indicator is future-relevant by providing information on the organizational capability to set and meet emissions reduction targets. Dimension 1 of this indicator adds credibility to any company claim to commitment to a science-based reduction pathway.
  • Indicators 1.1 and 1.2 look at targets into the future, setting a theoretical view of the company. Dimension 2 of this indicator adds value to the analysis by doing a concrete comparison of the company’s current performance against their targets in the reporting year.

Scoring rationale:

Quantitative interpretation of previous target achievement is not straightforward. The performance score thus makes no judgement of previous target ambition and leaves it to the narrative analysis to make a meaningful judgement on the ambition level of past targets.

  • Dimension 1 of the performance score will penalize companies who have not met previous targets in the past 10 years, as this means the company has lower credibility when setting ambitious science-based targets.
  • Dimension 2 uses a simple ratio sourced from existing CDP data points (CC 3.1e) in order to compare targets. The threshold 0.5 was chosen as it allows companies some flexibility with respect to the implementation of the target, but it does have the ability to flag companies that are definitely not on track towards achievement. When p is lower than 0.5, the company needs to achieve more than twice the reduction per unit of time than the target originally envisioned.
  • Regarding the lifespan of assets, we will consider average lifespan between interventions to modernize owned assets. Indeed in this sector; assets can have widely different lifespan, some equipment’s being kept for 100 years. Thus, if the company cannot provide this value, the default value for assets lifespan between two modernization interventions will be based on Moya J. A. and Pavel C. C [12] with 30 years for paper machines in paper mills and 60 years for pulp machines in pulp mills.

 

5.3.2. Material Investments (Weighting: 15 - 25%)

If some assets represent less than 5% of the total production, a cut off rule would be applied to simplify the calculation and limited the time for data collection. The data collection related to these plants is not necessary if a justification is given to the analyst.

5.3.2.1 - PP 2.1 Trend in past performance (WEIGHTING: TBD%)

Description & Requirements PP 2.1 Trend in past performance
Short description of indicator This metric assesses the alignment of the company’s past emission intensity trend and past performance with carbon budget for scopes 1+2 emissions with the trend of its past decarbonization pathway. The recent emission intensity trend is computed over a 5-year period to the reporting year (reporting year minus 5 years).
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2]
  • For all existing and planned assets: Asset name, Geographic Location (country level), Plant type, Status, Total capacity (metric tonne), Production (metric tonnes of pulp and paper), Emissions factor (kg CO2e/tonne Pulp and Paper), Year of commissioning, Expected lifetime (years), Decommissioning or modernization year, if planned, Ownership stake (%), Attributable to reporting boundary (%)
  • The reporter shall provide plant activity (tonnes metric tonnes air-dry weight -with 10% moisture content- for pulp products and in metric tonnes for paper products) and emissions data (kgCO2e/tonne of product) by plant type for the last five years and also the total market pulp purchased at corporate level for the last five years

External sources of data used for the analysis of this indicator are:

  • IEA ETP – background scenario data
  • IPCC (2006)(6) – Fuel emission factors

(6) IPCC. IPCC Guidelines for National Greenhouse Gas Inventories, Volume 3, Chapter 2. 2006.

The benchmark indicators involved are:

 

How the Analysis will be done

There are two dimensions in this indicator, each one weighting 50%.

Dimension 1 (50%) – Trend in past emissions intensity

The analysis is based on the Past Action ratio (Apast) which represents the ratio between the company’s recent (reporting year minus 5 years) emissions intensity (EIC) from material investment trend gradient and the company’s benchmark recent (reporting year minus 5 years) emission intensity trend gradient (EIB). The company’s benchmark is defined from the company’s current emissions on reporting year, and from the sectoral benchmark presented in section 6.1.

Figure 5 illustrates the various curves and trends used in this indicator.

 

Figure 5: Comparison of trend in past emissions intensity of the company and company's benchmark

 

Four cases are will be used for the scoring, they are describe in the table below :

 

Dimension 2 (50%) – Alignment of past performance with carbon budget

This metric assesses the alignment of the company’s recent absolute emissions with the past carbon budget. The recent emissions and carbon budget are measured over a 5-year period previous to the reporting year (reporting year minus 5 years). For this dimension, we use data on past emissions from the assessed company and compare it to the sector benchmark.

The ratio is computed with the following calculation: 

 

Figure 6 - Alignment of past performance with carbon budget

 

The score will be attributed as described in the table below:

 

 

Rationale PP 2.1 TREND IN PAST PERFORMANCE
Rationale of the indicator

Relevance of the indicator:

Regarding dimension 1, trend in past emissions intensity is included in the ACT PP assessment for the following reasons:

  • The trend shows the speed at which the company has been reducing its emissions intensity over the recent past. Comparing this to the decarbonization pathway gives an indication of the scale of the change that needs to be made within the company to bring it onto a low-carbon pathway.
  • While ACT aims to be future-oriented, ACT does not want to solely rely on projections in a way that would make the analysis too vulnerable to uncertainty. Therefore, this particular indicator, along with projected emissions intensity and absolute emissions, forms part of a holistic view of company emissions performance in the past, present, and future.

Regarding dimension 2, alignment of past carbon budget is included for the following reasons:

  • Assessing the level of past emissions as opposed to the benchmark (for the past years where the benchmark is available) helps the company having an overview of its emissions exceedance in the recent past. This indicator also intends to remind that the carbon budget is set for the global economy and that each sector and each company has a defined carbon budget that cannot be exceeded to reach the overall long-term objective of limiting global warming. The emissions overshooting the benchmark in the past correspond to accumulated CO2 that will remain in the atmosphere for decades. Hence, a company having already exceeded the benchmark should further its efforts to decrease its emissions in the near and remote future.
  • ACT is a forward looking methodology but does not consider the past to assess directly the future performance. Knowing a trend in the past (on activity or budget) is relevant to assess if in a company has the capacity to reach their future targets.

Scoring rationale:

Concerning dimension 1, while ‘gap’ type scoring is preferred for any indicator where possible, this indicator only looks at past emissions, and would therefore require a different baseline in order to generate a gap analysis. Thus, instead of a gap analysis, a trend analysis is conducted. An advantage of the trend analysis is that it does not require the use of a business-as-usual pathway to anchor the data points and aid interpretation, as trends can be compared directly, and a score can be directly correlated to the resulting ratio.

Concerning dimension 2, a ratio is made between past carbon of the company assessed and the sector benchmark to evaluate how a company have in the past stayed aligned with its carbon budget or otherwise.

NB : in previous methodologies, the comparison of trend was made over two different periods ( pas 5 years of the company emission intensity with the company benchmark over the future 5 years after the reporting year). At the time of redaction of this methodology, trends are compared over the same time period.

 

5.3.2.2 - PP 2.2 Trend in future direct emissions intensity from material investment (WEIGHTING: TBD%)

Description & Requirements PP 2.3 Trend in future direct emissions intensity from material investment
Short description of indicator A measure of the alignment of the company’s projected Pulp and Paper production assets emissions intensity with its decarbonization pathway. The indicator will identify the ratio between trend gradients in 5 years after the reporting year between the company’s emission intensity from material investment and the decarbonization pathway
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2]
  • Company’s target and target year Variation of [C4.1a], [C4.1b]
  • For all existing and planned assets: Asset name, Geographic Location (country level), Plant type, Status, Total capacity (metric tonnes), Production (metric tonnes of pulp and paper), Emissions factor (kg CO2e/tonne Pulp and Paper), Year of commissioning, Expected lifetime (years), Decommissioning or modernization year, if planned, Ownership stake (%), Attributable to reporting boundary (%)
  • The reporter shall provide plant activity ((kgCO2e/ tonne Pulp and Paper) and emissions data (kgCO2e/ tonne Pulp and Paper) by plant type for the last five years

External sources of data used for the analysis of this indicator are:

  • IEA ETP [4] – background scenario data
  • IPCC [13] – Fuel emissions factors

The benchmark indicators involved are:

 

How the Analysis will be done

The analysis is based on the Future Action ratio (AFuturewhich represents the ratio between the company’s future (reporting year plus 5 years) emissions intensity from material investment trend gradient and the company’s future benchmark (reporting year plus 5 year) emission intensity trend gradient.

The emission intensity from the company (EIC) is the weighted average plant emissions intensity over time, assuming the continuation of active plants until anticipated decommissioning and the completion of known plant/retrofit projects. If unknown, the commissioning year of projects is estimated from the project status (e.g. bidding process, construction, etc.) and data on typical project periods by plant type.

See section 6.1 for details on the computation of the benchmark emission intensity (EIB)

Calculation of the score:

To assign a score to this indicator, the company’s future trend between reporting year and reporting year plus five years, the size of the action gap will be compared to the maximum action gap, which is defined by the business as usual pathway (𝐵𝐴𝑈P). 𝐵𝐴𝑈P is defined as an unchanging (horizontal) intensity pathway, whereby the emissions intensity is not reduced at all over a period after the reporting year.

 

where EIc(YR) is the company emission intensity at reporting year, EIc(YR + 5) is the company emission intensity at reporting year plus 5 years, EIB(YR) is the benchmark emission intensity at reporting year and EIB(YR + 5) is the benchmark emission intensity at reporting year plus 5 years.

The final score assigned to the indicator is calculated as follows:

 

Rationale PP 2.2 Trend infuture direct emissions intensity
Rationale of the indicator

Relevance of the indicator:

The trend in future emissions intensity is included in the ACT assessment for the following reasons:

  • It indicates if the company is in line with a low-carbon scenario
  • This indicator is the most valuable in terms of the information it provides on the company’s actual action towards decarbonization.
  • This particular measure, along with recent emissions intensity and absolute emissions, forms part of a holistic view of company emissions performance in the past, present, and future.

Scoring rationale:

The comparison of trend gradient in future emissions intensity in the future allow to look at the future. .

NOTE: Where plant lifetime information is unavailable (requested in PP 2.2), the default lifespan in Pulp and Paper sector will be applied.

 

5.3.2.3 - PP 2.3 Share of low-carbon CAPEX (WEIGHTING: TBD%)

Description & Requirements PP 2.3 SHARE OF LOW-CARBON CAPEX
Short description of indicator This indicator brings a qualitative measure of how the company is switching its production to more low-carbon pulp and paper products.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Share of low-carbon CAPEX
  • Emissions reduction resulting from low-carbon CAPEX.
How the Analysis will be done

A company that is placed in the ‘aligned’ category will receive the maximum score. Companies who are at lower levels will receive a partial score, with 0 points awarded for having no engagement at all.

This maturity matrix is indicative but does not show all possible options that can result in a particular score. Companies responses will be assessed by the analyst and then placed on the level in the matrix where the analyst deems it most appropriate. A list is proposed of technologies that might be deployed in the pulp and paper sector, that can be completed by the best available techniques (BAT) benchmark developed by the European Commission [14].

The maturity matrix used will be the following:

 

 

5.3.2.4 - PP 2.4 Locked-in direct emissions (WEIGHTING: TBD%)

Description & Requirements PP 2.3 locked-in direct emissions
Short description of indicator A measure of the company’s cumulative GHG emissions from the reporting year to reporting year + 15 years from installed and planned plants. The indicator will compare this to the absolute emissions budget entailed by the company’s intensity decarbonization pathway and projected trends in the sector at the country/regional level.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2]
  • Company’s target and target year [C4.1a], [C4.1b]
  • For all existing and planned assets: Asset name, Geographic Location (country level), Plant type, Status, Total capacity (metric tonnes), Production (metric tonnes of pulp and paper), Emissions factor (kg CO2e/tonne Pulp and Paper), Year of commissioning, Expected lifetime (years), Decommissioning or modernization year, if planned, Ownership stake (%), Attributable to reporting boundary (%)

External sources of data used for the analysis of this indicator are:

  • IEA ETP [4] background scenario data
  • IPCC [13] Fuel emissions factors

The benchmark indicators involved are:

 

 

How the Analysis will be done

The analysis is based on the ratio between the company’s installed and planned emissions for the 15 years after the reporting year [𝐿𝐺(𝑡)], and the emissions budget entailed by the company’s carbon budget [𝐵𝐺(𝑡)] over the same period of time.

𝐿(𝑡) is calculated as the total cumulative emissions implied by the lifetimes of currently active and confirmed planned assets that are going to be commissioned soon. If unknown, the commissioning year of projects is estimated from the project status (e.g. bidding process, construction, etc.) and data on typical project periods by plant type. An average historical capacity factor over a 5-year period to the reporting year is applied to plant capacities to estimate future production.

𝐿(𝑡) is calculated as the company’s locked-in carbon commitments, up until the chosen time period t, which is derived by taking the area under the company’s future locked-in emissions curve. This curve in turn is derived from the company’s intensity pathway CAG, multiplied by activity AG:

 

Figure 7: Computing locked-in emissions at facility and company level

 

𝐵(𝑡) is calculated as the company’s carbon budget up until time t, which is derived by taking the area under the absolute emissions reduction curve. This curve in turn is derived from the company benchmark pathway (CBscope12) by multiplying it by activity 𝐴𝐺:

 

Figure 8: Comparison of company’s carbon locked-in emissions and projected activity with company’s benchmark carbon budget

Depending on the data availability, the computation of these areas may not be as straightforward as the equations shown and will be done by approximation, but the principles will hold.

The locked-in ratio (rLB) is calculated as follows:

The default value for t is 15 years after the reporting year.

Security activity ratio allows to calculate which part of the company's future activity will be covered by the disclosed assets. The secured activity ratio rSA  (y_r+15) compares the secured activity up to 2050 As (yr+15)with the projected activity up to 2050 Ap (yr + 15).

The security ratio rSA is calculated as follows:

 

Calculation of the score:

The final score compares the company's locked-in emissions to a theoretical portfolio with a similar locked activity per year and benchmark emission intensity. It should be highlighted that_rSA is used as a threshold value for the scoring. The final score assigned to the indicator is calculated as follows:

 

Rationale PP 2.4 locked-in emissions
Rationale of the indicator

Relevance of the indicator:

Locked-in emissions are included in the ACT assessment for the following reasons:

  • Absolute GHG emissions over time are the most relevant measure of emissions performance for assessing a company’s contribution to global warming. While the indicator PP 2.1 has a short-term measurement point on reporting year plus 5 years, the concept of locked-in emissions allows a judgement to be made about the company’s outlook in more distant time periods.
  • Analyzing a company’s locked-in emissions alongside science-based budgets also introduces the means to evaluate the potential cost of inaction, including the probability of stranded assets.
  • Examining absolute emissions, along with recent and short-term emissions intensity trends, forms part of a holistic view of a company’s emissions performance in the past, present, and future.

Scoring rationale:

The only data coming in is provided by the asset dataset: currently active plants and plants and modernization / retrofit plans that are ‘in the pipeline’ (which can be estimated to become active in the short-term).

Hence, the locked-in emissions calculated are the locked-in emissions of committed (existing and pipeline) plants only. The indicator describes the proportion of their budget (computed from the reporting year for 15 years ahead) that will be used up by committed activity.

Unlike the ‘gap’ and ‘trend’ comparisons done in all other quantitative indicators, this indicator compares two areas: that of the carbon budget until t and the locked-in emissions until t. It is expected that companies will exceed their budget when t is in the short-term future but will not when it is in the long-term future. However, any short-term exceedance will have to be compensated for in later time periods. This is called carbon budget displacement, which makes the company’s actual decarbonization pathway steeper than the original benchmark. There is a dimension of risk from inaction here.

When the company exceeds its full carbon budget to reporting year + 15 years, it will not be able to displace enough carbon from later time periods to nearer ones and will be faced with stranded assets when the current lifetime estimates are held up. This is a major problem, and this situation will certainly result in a zero score.

When companies have consumed a larger part of their carbon budget than others companies, they will be less flexible in their future strategy as there is more pressure to change their equipment on a plant (modernization on a kiln for example). There is also less room for refurbishment to extend the lifetimes of existing assets as this carries the risk of exceeding the carbon budget. Therefore, there is rationale for intermediate scoring levels that magnify this level of risk due of future flexibility in the future.

Note on calculating LG and BG:

If the company cannot provide a lifespan for assets, the lifetime of the asset is assumed to be the maximum lifespan before modernization of the process equipment (paper and pulp machines). The methodology will propose the following default values:

  • For paper machines, the maximum lifespan before modernization is 30 years.
  • For pulp machines, the maximum lifespan before modernization is 60 years.

These default values are the same used for indicator PP 2.1

Rationale PP 2.4 Share of low-carbon CAPEX
Rationale of the indicator

Relevance of the indicator:

This indicator will help to assess and value efforts deployed by companies to acquire assets contributing to low-carbon process or low-carbon products.

 

5.3.3. Intangible investments (Weighting: 5 – 10%)

 

5.3.3.1 - PP 3.1 R&D spending in low carbon technologies (WEIGHTING: TBD%)

Description & Requirements PP 3.1 R&D SPENDING IN LOW CARBON TECHNOLOGIES
Short description of indicator

A measure of the ratio of R&D investments in mitigation. The indicator identifies the ratio between the company’s R&D investment in technologies for mitigation and total R&D investments.

Climate mitigation technologies for the Pulp and Paper sector may include:

  • Enzymatic pre-treatment
  • New drying technologies
  • Deep eutectic solvent pulping
  • Flash condensing with steam
  • Black liquor gasification

A list can be found in the annex with a list of ‘mature’ and ‘non-mature’ technology.

DATA REQUIREMENTS

The questions comprising the information request that are relevant to this indicator are:

  • Annual amount of capital expenditures R&D (in dollars) Variation of [CDP C-CO9.6/C-CE9.6/C-OG9.6] for the three last years[C-ST9.6a]Annual amount of capital expenditures R&D, financing mitigation technologies (in dollars) [C-ST9.6a]
How the Analysis will be done

The analysis is based on the ratio of the company’s ‘annual R&D expenditure on mitigation (CAPEX R&D mit) to the company’s ‘total annual capital expenditure in R&D’ (CAPEX R&D ).

The ratio is defined as the ‘mitigation R&D intensity’ ratio (D ) or:

 

A maturity matrix is then used to assess this indicator, depending on the value of the ratio D.

 

 
Rationale PP 3.1 R&D SPENDING IN LOW CARBON TECHNOLOGIES
Rationale of the indicator

Relevance of the indicator:

R&D can be a significant lever for the Pulp and Paper sector with emerging technologies (CO2 Capture and storage, Black Liquor gasification, biorefineries…) and can be a significant step to progress toward a low-carbon aligned company. R&D is also one of the principal tools to reduce the costs of a technology in order to increase its market penetration. Lastly, the R&D investment of a company into non-mature technologies allows for direct insight into the company’s commitment to alternative technologies that may not currently be part of its main business model.

Scoring rationale:

Expenditures over the 3 last years are used for the indicator to consider that expenditure for major R&D projects may not be linear over years.

 

5.3.4. Sold product performance (Weighting: 15 – 20%)

 

Questions for the public consultation

 

Q1: Do you think that it would be relevant to include an indicator on chemicals and other additives in the module 4. Sold Product Performance? If so, how would you assess qualitatively companies?

 

Q2: When using chemicals for your processes, do you have a choice of products? (e.g., can you substitute current chemical inputs by other ones less GHG intensive)

 

Q3: What are the levers that you identified to reduce those indirect emissions? (in terms of sobriety, efficiency, or sourcing)

 

5.3.4.1 - PP 4.1 Trend in past products specific performance (WEIGHTING: –TBD%)

Description & Requirements PP 4.1 TREND IN PAST EMISSIONS INTENSITY OF PURCHASED PULP AND PAPER PRODUCTS PRODUCTS SPECIFIC PERFORMANCE
Short description of indicator This metric assesses the alignment of the company’s pulp and paper purchased with its decarbonization pathway. The indicator will compare the gradient of this trend over a 5-year period to the reporting year (reporting year minus 5 years) with the decarbonization pathway trend over a 5-year period after the reporting year. This indicator allows to measure efforts from pulp and paper companies in switching its production to more low-carbon products.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2]
  • For all existing and planned assets: Asset name, Geographic Location (country level), Plant type, Status, Total capacity (metric tonnes), Production (metric tonnes of pulp and paper), Emissions factor (kg CO2e/tonne Pulp and Paper), Year of commissioning, Expected lifetime (years), Decommissioning or modernization year, if planned, Ownership stake (%), Attributable to reporting boundary (%)
  • The reporter shall provide plant activity (metric tonnes of pulp and paper) and emissions data (kgCO2e/ tonne Pulp and Paper) by plant type for the last five years
  • For the past 5 years, for each suppliers, quantity of market pulp and paper purchased and the associated CO2 emissions

External sources of data used for the analysis of this indicator are:

  • IEA ETP [4] – background scenario data
  • IPCC (2006) [13] – Fuel emissions factors

The benchmark indicators involved are:

 

How the Analysis will be done

See indicator PP 2.1, as it will be the same computation.

The analysis is based on the ratio between the company recent emission intensity (CR’) (reporting year minus 5 years) from product performance trend gradient and the company’s benchmark recent (reporting year minus 5 years) emission intensity from product performance trend gradient (CB’).. The supplier’s benchmark is defined from the supplier’s current emissions on reporting year, and from the sectoral benchmark presented in section 6.1.

Figure 10 illustrates the various curves and trends used in this indicator.

 

Figure 10 - Comparison of trend in past emissions and trend in supplier's benchmark

 

If no data from the suppliers is provided, the score assigned is 0.

Note: if the company cannot collect data about the amount and emission intensity for all its suppliers, the score shall be adjusted downwards proportionally to the percentage of pulp and paper products purchased missing compared to the total amount of pulp and paper purchased.

Rationale PP 4.1 TREND IN PAST EMISSIONS INTENSITY OF PURCHASED PULP AND PAPER PRODUCTS PRODUCTS SPECIFIC PERFORMANCE
Rationale of the indicator

Relevance of the indicator:

This indicator is meant to ensure that companies have been investing enough in transitioning materials purchased to low-carbon paper and carton board products, in line with their supplier’s benchmark.

Trend in past emissions intensity is included in the ACT PP assessment for the following reasons:

  • The trend shows the speed at which the company has been reducing its emissions intensity over the recent past. Comparing this to the decarbonization pathway gives an indication of the scale of the change that needs to be made within the company to bring it onto a low-carbon pathway.
  • While ACT aims to be as future-oriented, it nevertheless does not want to solely rely on projections of the future, in a way that would make the analysis too vulnerable to the uncertainty of those projections. Therefore, this measure, along with projected emissions intensity and absolute emissions, forms part of a holistic view of company emissions performance in the past, present, and future.

Scoring rationale:

While ‘gap’ type scoring is preferred where possible for any indicator, this indicator only looks at past emissions and would therefore require a different baseline to generate a gap analysis. Thus, instead of a gap analysis, a trend analysis is conducted to compare current data of the company to the past data and improvements that have been made since the past data. An advantage of the trend analysis is that it does not require the use of a business-as-usual pathway to anchor the data points and aid interpretation; trends can be compared directly and a score can be directly correlated to the resulting ratio.

 

5.3.4.2 - PP 4.2 Share of certified and recovered fiber in paper and cardboard products (WEIGHTING: TBD%)

 

Question for the public consultation

 

Q4: What is the maximum share of recycled fiber per broad product category (household and sanitary paper, Packaging material, graphic papers, other paper and paperboard) in terms of share (in %) of recovered fiber in the final product? 
Q5: What is the average of recovered fiber per regions of the word?

 

Description & Requirements PP 4.2 Share of certified and recovered fiber in final products
Short description of indicator This metric allows to measure of the share of sustainable virgin fibre and recovered fiber for products from the pulp and paper sector. Using recovered fibers substantially contributes to a sustainable global fiber supply and contributes to encourage a cascading system of wood fiber utilization.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Reporting year [C0.2] (7)
  • Company’s target and target year Variation of [C4.1a], [C4.1b]
  • Production (metric tonnes of pulp and paper),)
  • Share of current overall recycled and sustainable fiber for total volume of production Variation of [F6.1], [F6.2],

(7) the details in the [ ] are the questions in the 2020 CDP Climate Change questionnaire

How the Analysis will be done

For the performance score, this indicator will be assessed the ratio of recovered fiber used in final products and the share of virgin fiber certified as sustainable:

A ratio will be made, with data from the reporting year, between total volume of recovered fiber used to production pulp or paper products (VRF) on total volume of fiber ( virgin fiber AND recycled fiber) used to produce pulp or paper products (VWRF)

Volume will be reported in metric tons of paper and paperboard products. Any volume bought will be added to the own production volume and any volume sold will be subtracted from the total company’s volume. Pulp and paper product will be reported separately.

The methodology acknowledges the need of a certain level of virgin fiber to manufacture final products of the sector for different reason:

  • Limits to the amount of used paper that can be recovered.
  • Unavoidable losses occur during recovered paper processing and reuse
  • Degradation of fiber quality with multiple uses, hence, require the addition of fresh fiber to meet quality requirements.

This indicator will analyze the remaining volume of virgin fiber and if it beneficiates from a certification ensuring its sustainability such as Forest Stewardship Council (FSC), Programme for the Endorsement of Forest Certification (PEFC) , Sustainable Forestry Initiative (SFI), Preferred by nature Smartlogging. Other forestry certification. schemes can be considered if enough evidence is provided regarding the sustainability dimension of the certification.

The score attributed to the company will be the sum obtained from the ratio of recovered fiber used in final products (SRF) and the ratio of virgin fiber certified as sustainable (SSF).

Fresh fiber production and processing usually requires more energy than recycled fiber processing, but it relies on renewable energy to a greater extent than recycled fiber processing. Thus, ensuring the decarbonization of energy used to produce final products using of recycled fiber is key to ensure a global decrease in GHG emissions. Therefore indicator 4.2 is complementary with indicator 4.5 looking at self-generated electricity and indicator 4.6 addressing low carbon heat.

 

5.3.4.3 - PP 4.3 ACTION ON DEFORESTATION AND SUSTAINABLE WOOD PROCUREMENT (WEIGHTING: TBD%)

 

Questions for the public consultation

 

Q6: What actions do you implement to ensure the sustainability of the woody biomass used for energy purposes?

 

Q7: If woody biomass comes from a forest you own/ manage, have you developed specific guidelines regarding woody debris (branches, tops etc….)?

 

Q8: Do you conduct a regular assessment of carbon stocks at the landscape level for the forest you own/manage?

 

Description & Requirements PP 4.3 ACTION ON DEFORESTATION AND SUSTAINABLE WOOD PROCUREMENT
Short description of indicator This indicator integrates two dimensions. The first dimension is based on Forest 500 methodology [15] to evaluate the level of company’s commitment to ban deforestation, track progress and incentivize reforestation in the short term. The second dimension is loosely based on the environmental paper company index developed by WWF [16].
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Commitments and implementation of actions on deforestation – Variation of [F6.1], [F6.2],[F6.3],[F6.4]
  • Commitment on responsible procurement of wood fibers - Variation of [F6.1], [F6.2],[F6.3],[F6.4]

External sources of data used for the analysis of this indicator are:

  • Global Canopy, The Forest 500: 2019 Company Assessment Methodology, 2019 [15]
  • WWF, Questionnaire for Pulp and Paper Companies to participate in the environmental paper company index, 2019 [16]

 

How the Analysis will be done

For the performance score, this will be assessed on two dimensions:

DIMENSION 1: Action on deforestation

This maturity matrix is derived from indicators from the company’s assessment methodology of Forest 500 by Global Canopy

 

DIMENSION 2: Ensuring sustainable wood procurement

This maturity matrix is loosely derived from the questionnaire developed by the WWF, the Environmental Paper Company Index (EPCI) for the two sub-dimension. They focus on what are the current policies implemented to exclude controversial furnishing of fibre and what are the targets in the near future to increase responsible and sustainable sourcing. The last sub-dimension aimed at assessing company efforts to ensure the sustainability dimension of woody biomass used for energy pusposes.

 

Regarding the use of woody biomass of energy puspose, there are few identified certifications schemes assessing the sustainability of solid biomass. Among those we can cite : REDcert, Sustainable biomass program (SBP), ISCC...

The Art 26 – 6 from RED II (2018) requires that the country in which forest biomass was harvested has national or subnational laws applicable in the area of harvest as well as monitoring and enforcement: Systems in place ensuring the legality of harvesting operations; Forest regeneration of harvested areas;

That areas designated by international or national law or by the relevant competent authority for nature protection purposes, including in wetlands and peatlands, are protected; That harvesting is carried out considering maintenance of soil quality and biodiversity with the aim of minimizing negative impacts; and That harvesting maintains or improves the long-term production capacity of the forest

Primary woody biomass refers to all roundwood felled or otherwise harvested and removed. It comprises the quantities removed from forests and from trees outside the forest, including wood recovered due to natural mortality and from felling and logging. It includes all wood removed with or without bark, including wood removed in its round form, or split, roughly squared or in other form, e.g., branches, roots, stumps and burls (where these are harvested) and wood that is roughly shaped or pointed (Eurostat, 2016). Secondary woody biomass refers to forest industry by-products, bark, and recovered post-consumer wood.

As the role of dead wood can be crucial to saproxylic species hence forest biodiversity, any company policies including dedicated harvest practices for primary biomass aiming at maintaining biodiversity and leaving them on-site will be considered in the overall narrative score. In order to avoid trade-off situations between harvested wood for energy purposes, company’s commitments to integrate biodiversity impacts into forest management will be valued in the narrative score ( e.g specific guidelines to leave coarse woody debris, or removing fine woody debris and low stumps above a certain level of threshold in order to maintain forest biodiversity and ensure there is no decrease in carbon soils).

Rationale PP 4.3 ACTION ON DEFORESTATION AND SUSTAINABLE WOOD PROCUREMENT
Rationale of the indicator

Relevance of the indicator:

Sustainable management is a key factor for wood-based products and is represented in the dimension 2. Additionally, procurement of wood can be related to deforestation although Pulp and paper companies may not be directly involved in deforestation but have a strong role to play in tracking their supplies.

Scoring rationale:

  • Dimension 1 (50%): Based on the maturity matrix presented in the precedent section
  • Dimension 2 (50%): Based on the maturity matrix presented in the precedent section

Note:Other aspects not included in dimension 2 but related to responsible sourcing (e.g biodiversity considerations…) will be appreciated in the narrative score.

 

PP 4.4 Biogenic carbon storage in final products (WEIGHTING: TBD%)

 

Question for the public consultation

 

Q9: If you are a company, do you calculate, and report carbon stored in final products? If yes, which guidelines do you use to calculate, and report carbon stored in final products?

 

Description & Requirements PP 4.4 Biogenic carbon storage in final products
Short description of indicator This indicator aimed at evaluating the share of carbon stored in final products from pulp and paper industry.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Biogenic carbon stored for each product category

External sources of data used for the analysis of this indicator are:

  • Biogenic carbon footprint calculator – (WWF)
How the Analysis will be done

If a company does not have an LCA providing information on biogenic carbon stored in its products, they can use the tool developed by WWF(14) on calculating biogenic carbon footprint of wooden products. The analyst will use this tool as way to compute the biogenic carbon stored in wood-based product, the section allowing to compute the “carbon debt” will not be considered for this indicator.

(14) The tool is in annex or can be accessed at the following address : https://www.worldwildlife.org/projects/biogenic-carbon-footprint-calculator-for-harvested-wood-products  

For all products, companies can use the basic module of the biogenic carbon footprint calculator, which requires the following information: volume (in kgC), share of recycled/virgin fiber, product lifespan. For the latter, default values are available in the tool. 

If results from a specific LCA is used, the scenario of reference “net-zero” emission for impacts from harvesting can be used. The result used shall be in kgCO2e and the carbon stored shall be evaluated with a global warming potential (GWP) with a period of 100 years. 

 

 

The score will be the average biogenic carbon footprint for one tonne of product. If the result is higher than 100, the company is awarded the highest score. Otherwise, the company is awarded the score corresponding to the average carbon stored in one tonne of product. As product lifespan is one of the main factors affecting the computation of carbon stored in final products, the analyst will use the default value of products from the pulp and paper industry which is between 1 and 4 years, depending if the . A different lifespan could be used by the analyst, if a LCA has been conducted for a specific product category

 

 
Rationale PP 4.4 Biogenic carbon storage in final products  
Rationale of the indicator

Relevance of the indicator:

This indicator will value biogenic carbon stored in wood-based products from the pulp and paper companies, with an emphasis on certified sustainable forest management.

Scoring rationale:

The scoring will be equal to the amount kgCO2e stored in wood-based products from the pulp and paper companies. One of the main parameters allowing to increase the volume of carbon stored in wood-based products if the lifespan of products, so the rationale is to incentive the pulp and paper sector in producing final products with higher share of carbon and longer lifespan.

 

 

5.3.4.5 - PP 4.5 Increase low carbon energy (WEIGHTING: TBD%)

 

Question for the public consultation

 

Q10: For companies producing electricity, are you able to calculate the carbon intensity (in gCO2/kWh) of the electricity you generate, especially when you use Combined Heat and Power (CHP)? Which guidelines do you use to allocate CO2 emissions between heat and electricity?

 

Description & Requirements PP 4.5 Increase low carbon electricity  
Short description of indicator This indicator allows an analysis of the decarbonization of self-generated electricity of the company  
Data requirements

The relevant data for this indicator are:

  • Qualitative data on the low carbon electricity strategy to fill the maturity matrices
  • Emissions intensities and self-generated electricity volume (MWh)
 
How the Analysis will be done

The assessment will assign a maturity score based on the company’s low carbon electricity assets.

A company that is placed in the ‘aligned’ category will receive the maximum score. Companies who are at lower levels will receive a partial score, with 0 points awarded for having no engagement at all.

 

Dimension 1 – low carbon electricity strategy

 

Dimension 2 – ELECTRICITY CARBON INTENSITY FROM THE COMPANY’S ASSETS

Moreover, the carbon intensity of the self-generated electricity will be assessed for reporting year (Y) and Y+5 years.

 

Calculation of score:

Future Action ratio (Afuture) is calculated by comparing the change of the carbon intensity of the self-generated electricity carbon intensity between reporting year and reporting year + 5 to change of the carbon intensity of the company’s benchmark over the same period of time

where EIc(YR) is the company emission intensity at reporting year, EIc(YR + 5) is the company emission intensity at reporting year plus 5 years, EIB(YR) is the benchmark emission intensity at reporting year and EIB(YR + 5) is the benchmark emission intensity at reporting year plus 5 years.

The action gap of the company is equal to (1 − Afuture).

Thus, when the company’s future emissions pathway is aligned on the company’s benchmark, the Future Action ratio is equal to 1 and the action gap is 0.

The final score assigned to the indicator is calculated as follows:

 

Dimension 3 –Share of low-carbon heat

The following maturity matrix aimed at assessing company’s effort in the decarbonization of heat.Low-carbon technologies for heat generation at low-medium temperature (0-400°C) are available and include : biomass heater, electric heater, hydrogen heater, heat pump, solar and geothermal heat. This dimension is complementary to the company’s strategy in investing in electrification.

The assessment will assign a maturity score based on the company’s low carbon heat assets. A company that is placed in the ‘aligned’ category will receive the maximum score. Companies who are at lower levels will receive a partial score, with 0 points awarded for having no engagement at all

 

Rationale PP 4.5 Increase LOW CARBON ENERGY
Rationale of the indicator

Relevance of the indicator

Decarbonization of energy is key for the pulp and paper industry. Since heat and electricity are particularly linked through the industrial process, this indicator is divided into three complementary dimensions : company’s strategy to invest in low-carbon strategy, the carbon intensity of self-generated electricity of the company the current share of low-carbon heat.

Scoring rationale:

Dimension 1 (35%): Based on the maturity matrix presented in the precedent section

Dimension 2 (35%): Based on the maturity matrix presented in the precedent section

Dimension 3 (30%): Based on the maturity matrix presented in the precedent section

 

5.3.4.6 - PP 4.6 Inbound and outbound Transportation carbon performance (WEIGHTING: TBD%)

 

Question for the public consultation

 

Q11: Do you think of any other action with significant climate impact that companies in the sector can implement to reduce their GHG emissions regarding outsourced transportation? (11 eligible actions for now)

 

Description & Requirements PP 4.6 Inbound and outbound Transportation carbon performance
Short description of indicator

The purpose of this indicator is to analyze the strategy and implemented actions to reduce GHG emissions due to inbound/outbound transportation (including internal transportation - transport of material produced by same company from one mill to another, such as pulp to the paper mill)

When the company totally outsources its transportation activities, the indicator assesses how robust is the reporting of GHG emissions from transportation companies, if the company has defined a specific GHG emission reduction target or included it in a global GHG emission reduction target, and the past and present actions that the company implemented to reduce these emissions.

When the company partially performs the inbound/outbound transportation related to its pulp and paper activities (more than 25% of the GHG emissions is due to transportation performed with the company’s own vehicle fleet), then the company is also assessed on the following topics: how robust is the GHG emission and fleet carbon efficiency (in gCO2e/t.km) measurement, and the past and present actions that the company implemented to reduce these direct emissions (actions on both material and operations – only for truck and utility vehicles).

When the company totally performs the inbound/outbound transportation related to its pulp and paper activities, then the company is not assessed on the outsourced transportation topics.

Data requirements

The needed data to answer the questions in the maturity matrix are:

  • [For in house transportation]
    • Details on GHG emissions reporting (GHG emissions, traveled tons, traveled km, coverage)
    • Details on targets
    • Details on implemented actions on operations and material to reduce these direct GHG emissions
  • [For outsourced transportation]
    • Details on GHG emissions reporting from transportation companies
    • Details on targets
    • Details on strategy and implemented actions to reduce these indirect GHG emissions
How the Analysis will be done

 

 

* Actions eligible for GHG emission reduction on material (only truck and utility vehicles) are:

  • Use of low-carbon vehicles (using 100% electricity, hybrid, using low-carbon hydrogen, using BioGNV, or using sustainable biofuels)
  • Fuel efficiency devices
  • Preventive maintenance
  • Speed limitation devices
  • Predictive cruise control devices
  • Real-time fuel economy monitors (linked to driving methods)
  • Tire pressure monitoring systems
  • Low rolling resistance tires

*** Actions eligible for GHG emission reduction on operations (only trucks and utility vehicles) are:

  • Eco-driving (above 50% of the drivers have received a specific training)
  • Routing optimization
  • Load factor optimization
  • Reduction of empty runs
  • Improve backhauling
  • Speed regulation with Intelligent Speed Adaptation
  • Platooning
  • Co-loading

*** Actions eligible for GHG emission reduction due to outsourced transportation:

  • Modal shift towards less emission intensive means of transportation
  • Implementation of a multi-modal fret system that allows overall GHG emission reductions
  • Inclusion of carbon criteria in the specifications for transport suppliers (in gCO2e/t.km) with a high weighting in the scoring grid for suppliers
  • Change of input suppliers in order to reduce the travelled distance (local sourcing)
  • Co-development of sustainable offers with transportation companies (each action below is considered as 1 eligible action):
    • Signing of long-term contracts with guaranteed volume on low-carbon vehicles to incentivize transportation companies to purchase new low-carbons vehicles (lower the risk for them)
    • Co-investment in new low-carbon vehicles
    • Initiative to maximize the filling rate of the trucks/containers (e.g., load pooling with other companies, use of slip sheet instead of pallets, etc.)
    • Initiative to avoid empty returns
    • Increased spending in order to use sustainable and well sourced biofuels via for instance an internal carbon fund
    • Slowing down the speed of the vehicles to consume less fuel
    • Initiative to optimize route

Other actions than the ones listed above may be eligible, if judged relevant (significant climate impact) by the analysts.

For each action reported, the company shall ask to its 3 main contributors (subcontractors) to its carbon footprint, and report to the analyst:

  • The type of action
  • A short description of the action (goals, the implementation process, the monitoring of the action)
Rationale PP 4.6 inbound and outbound Transportation carbon performance
Rationale of the indicator

Relevance of the indicator:

Transportation activity represents a significant GHG emission source for companies in the pulp and paper sector. It aims at evaluating 3 key aspects of a GHG emission reduction strategy: GHG emissions measurement, target definition, implementation of actions. It looks at both the past and the present and considers transportation that is performed by the company (in house) and transportation companies (outsourced).

Scoring rationale:

A higher weighting on the topics related to strategy and implemented actions regarding measurement and targets.

Totally outsourced transportation weighting applies to companies which outsource 100% of its inbound / outbound transportation related to pulp and paper activities.

Transportation partially performed in house weighting applies to companies which own a vehicle fleet, and for which in house transportation GHG emissions account for more than 25% of total GHG emissions due to transportation.

Transportation totally performed in house applies to companies which own a vehicle fleet and performs 100% of its inbound / outbound transportation related to pulp and paper activities.

 

5.3.5. Management (Weighting: 10%)

 

5.3.5.1 - PP 5.1 OVERSIGHT OF CLIMATE CHANGE ISSUES (WEIGHTING: TBD%)

Description & Requirements PP 5.1 Oversight of climate change issues
Short description of indicator The company discloses that responsibility for climate change within the company lies at the highest level of decision making within the company structure.
Data requirements

The relevant data for this indicator are:

  • Environmental policy and details regarding governance - Variation of [C1.1], [C1.2] & - Variation of [CDP C1.1a], [CDP C1.2a]
  • The reporter shall provide details on where is the highest level of direct responsibility for climate change within the organization

-External sources of data may also be used for the analysis of this indicator when available

How the Analysis will be done

The benchmark case is that climate change is managed within the highest decision-making structure within the company. The company situation will be compared to the benchmark case, if it is similar then points will be awarded.

The position at which climate change is managed within the company structure will be determined from the company data submission and accompanying evidence.

A company that is placed in the ‘Low-carbon aligned’ category receives the maximum score. Companies that are at lower levels receive a partial score, with 0 points awarded for having no engagement at all.

The maturity matrix used for the assessment is the following:

 

 

Rationale PP 5.1 Oversight of climate change issues
Rationale of the indicator

Successful change within companies, such as the transition to a low-carbon economy, requires strategic oversight and buy-in from the highest levels of decision-making within the company. For the PP sector, a change in strategy and potentially business model will be required and this cannot be achieved at lower levels within an organization. Evidence of how climate change is addressed within the top decision-making structures is a proxy for how seriously the company takes climate change, and how well integrated it is at a strategic level. High-level ownership also increases the likelihood of effective action to address the low-carbon transition.

Changes in strategic direction are necessarily future-oriented, which fits with this principle of the ACT project.

Management oversight of climate change is considered good practice.

 

5.3.5.2 - PP 5.2 CLIMATE CHANGE OVERSIGHT CAPABILITY (WEIGHTING: TBD)

Description & Requirements PP 5.2 Climate change oversight capability
Short description of indicator Company board or executive management has expertise on the science and economics of climate change, including an understanding of policy, technology and consumption drivers that can disrupt current business.
Data requirements

The relevant data for this indicator are:

  • Environmental policy and details regarding governance - Variation of [CDP C1.1a], [CDP C1.2a]
  • The reporter shall identify the position of the individual or name of the committee with this responsibility and outline their expertise regarding climate change and the low-carbon transition

External sources of data may also be used for the analysis of this indicator.

How the Analysis will be done

The presence of expertise on topics relevant to climate change and the low-carbon transition at the level of the individual or committee with overall responsibility for it within the company will be assessed. The presence of expertise is the condition that must be fulfilled for points to be awarded in the scoring.

The analyst will determine if the company has expertise as evidenced through a named expert biography outlining capabilities. The analysis is binary: expertise is evident or not. A cross check will be performed against [CDP 3.1 question] on the highest responsibility for climate change, the expertise should exist at the level identified or the relationship between the structures/experts identified should also be evident.

A company that is placed in the ‘Low-carbon aligned’ category receives the maximum score; 0 points awarded for a company that is placed in the “Basic” category.

Rationale PP 5.2 Climate change oversight capability
Rationale of the indicator

Effective management of the low-carbon transition requires specific expertise related to climate change and its impacts, and their likely direct and indirect effects on the business. Presence of this capability within or closely related to the decision-making bodies that will implement low-carbon transition both indicates company commitment to that transition and increases the chances of success.

Even if companies are managing climate change at the Board level or equivalent, a lack of expertise could be a barrier to successful management of a low-carbon transition [16].

This disclosure is in line with Governance (a) of the TCFD: "a) Describe the board’s oversight of climate-related risks and opportunities.”

 

5.3.5.3 - PP 5.3 LOW-CARBON TRANSITION PLAN (WEIGHTING: tdb%)

Description & Requirements AG 5.3 Low-carbon transition plan
Short description of indicator The company has a plan on how to transition the company to a business model compatible with a low-carbon economy.
Data requirements

The relevant data for this indicator are:

  • Environmental policy and details regarding governance
  • The reporter should provide the following description of the transition plan including the following details - [C3.1a] , [C3.1b] , [C3.1c] , [C3.1d] , [C3.1e] , [C3.1f]:
    • Whether the transition plan exists in a documented form and whether that document is public
    • How the results of scenario testing influenced the transition plan
    • Timescale for implementation of the transition plan
    • Who has responsibility for its implementation (at the strategic, not operational, level)
    • How successful implementation of the plan will be measured and monitored. (Should include details of any linked targets, emissions reduction or energy efficiency targets, or KPIs.)
How the Analysis will be done

The analyst evaluates the description and evidence of the low-carbon transition plan for the presence of best practice elements and consistency with the other reported management indicators. The company description and evidence are compared to the maturity matrix developed to guide the scoring and a greater number of points are allocated for elements indicating a higher level of maturity.

  • Among the best-practice elements identified to date are:
  • The plan includes financial projections
  • The plan should include cost estimates or other assessment of financial viability as part of its preparation
  • The description of the major changes to the business is comprehensive, consistent, aligned with other indicators
  • Quantitative estimates of how the business will change in the future are included
  • Costs associated with the plan (e.g. write-downs, site remediation, contract penalties, regulatory costs) are included
  • Potential “shocks” or stressors (sudden adverse changes) has been taken into consideration
  • Relevant region-specific considerations are included
  • The plan’s measure of success is SMART (specific, measurable, acceptable, realistic, time bound) - contains targets or commitments with timescales to implement them, is time-constrained or the actions anticipated are time-constrained
  • The plan’s measure of success is quantitative
  • The description of relevant testing/analysis that influenced the transition plan is included, including product carbon hotspotting if this has been undertaken
  • The plan is consistent with reporting against other ACT indicators
  • Scope – should cover the entire business, and is specific to that business
  • The plan should cover the short, medium and long terms. From now or the near future <5 years, until at least 2035 and preferably beyond (2050)
  • The plan contains details of actions the company realistically expects to implement (and these actions are relevant and realistic)
  • The plan has been approved at the strategic level within the organization
  • Discussions about the potential impacts of a low-carbon transition on the current business have been included
  • The company has a publicly-acknowledged 2°C (or beyond) science-based target (SBT).

The maximum score (100%) is assigned if all of these elements are demonstrated.

A company that is placed in the ‘Low-carbon aligned’ category receives the maximum score. Companies that are at lower levels receive a partial score, with 0 points awarded for having no engagement at all.

The last criteria of the maturity matrix on “Adaptation to climate change” will be considered for companies who manage forests, as part of their supply chain.

Rationale PP 5.3 Low-carbon transition plan
Rationale of the indicator The Pulp and paper sector requires changes to its business to align with a low-carbon economy, over the short, medium and long terms, whether voluntarily following a strategy to do so or if forced to change by regulations and structural changes to the market. It is better for the success of its business and of its transition that these changes occur in a planned and controlled manner.

 

5.3.5.4 - PP 5.4 CLIMATE CHANGE MANAGEMENT INCENTIVES (WEIGHTING: TBD%)

Description & Requirements PP 5.4 Climate change management incentives
Short description of indicator The Board’s compensation committee has included metrics for the reduction of GHG emissions in the annual and/or long-term compensation plans of senior executives; the company provides monetary incentives for the management of climate change issues as defined by a series of relevant indicators.
Data requirements

The relevant data for this indicator are:

  • Management incentives -[C1.3] & [C1.3a]
  • The reporter shall report whether the company provides incentives for the management of climate change issues, including the attainment of targets
  • The reporter shall provide details on the incentives provided for the management of climate change issues
  • The reporter shall provide details on the activities that are usually rewarded by incentives in the company
How the Analysis will be done

The analyst verifies if the company has compensation incentives set for senior executive compensation and/or bonuses, that directly and routinely reward specific, measurable reductions of tons of carbon emitted by the company in the preceding year and/or to the future attainment of emissions reduction targets, or other metrics related to the company’s low-carbon transition plan.

The maturity matrix used for the assessment is the following:

Companies that are placed in the ‘Low-carbon aligned’ category receives the maximum score. Companies that are at lower levels receive a partial score, with 0 points awarded for having no engagement at all.

Rationale PP 5.4 Climate change management incentives
Rationale of the indicator

Executive compensation should be aligned with overall business strategy and priorities. As well as commitments to action the company should ensure that incentives, especially at the executive level, are in place to reward progress towards a low-carbon transition. This will improve the likelihood of a successful low-carbon transition plan.

Monetary incentives at the executive level are an indication of commitment to successful implementation of a low-carbon transition strategy.

 

5.3.5.5 - PP 5.5 CLIMATE CHANGE SCENARIO TESTING (WEIGHTING: TBD)

Description & Requirements PP 5.5 Climate change scenario testing
Short description of indicator Testing or analysis relevant to determining the impact of the transition to a low-carbon economy on the current and projected business model and/or business strategy has been completed, with the results reported to the Board or C-suite (CEO, CFO, etc.), the business strategy revised where necessary, and the results publicly reported.
Data requirements

The questions comprising the information request that are relevant to this indicator are - [C3.1a] , [C3.1b] , [C3.1c] , [C3.1d] , [C3.1e] , [C3.1f] :

  • Details on the organization’s climate change scenario testing
  • Consideration of risk types in organization's climate-related risk assessments
  • Details of risks identified with the potential to have a substantive financial or strategic impact on business
How the Analysis will be done

The analyst evaluates the description and evidence of the low-carbon economy scenario testing for the presence of best-practice elements and consistency with the other reported management indicators. The company description and evidence are compared to the maturity matrix developed to guide the scoring and a greater number of points is allocated for elements indicating a higher level of maturity.

Best-practice elements to be identified in the test/analysis include:

  • entire coverage of the company’s boundaries
  • timescale from present to long-term (2035-2050)
  • translation of results into value-at-risk or other financial terms
  • multivariate: a range of different changes in conditions are considered together
  • changes in conditions that are specific to a low-carbon climate scenario
  • climate change conditions are combined with other likely future changes in operating conditions over the timescale chosen.

Maximum points are awarded if all of these elements are demonstrated. Partial points might be awarded in case scenario testing has been carried out by the company even if not achieved.

 

Rationale PP 5.5 Climate change scenario testing
Rationale of the indicator

Changes predicted to occur due to climate change could have a number of consequences for the PP sector, including increased costs, a dramatically changed operating environment and major disruptions to the business. There are a variety of ways of analysing the potential impacts of climate-related changes on the business, whether these are slow and gradual developments or one-off “shocks”. Investors are increasingly calling for techniques such as use of an internal price on carbon, scenario analysis and stress testing to be implemented to enable companies to calculate the value-at-risk that such changes could pose to the business. As this practice is emergent at this time there is currently no comprehensive survey or guidance on specific techniques or tools recommended for the sector. The ACT methodology thus provides a broad definition of types of testing and analysis that can be relevant to this information requirement, to identify both current and best practices and consider them in the analysis.

Scenario stress testing is an important management tool for preparing for the low-carbon transition. For businesses likely to be strongly affected by climate change impacts (both direct and indirect), it has even greater importance.

 

5.3.6. Supplier engagement (Weighting: 2 – 8%)

 

5.3.6.1 - PP 6.1 STRATEGY TO INFLUENCE SUPPLIERS TO REDUCE THEIR GHG EMISSIONS (WEIGHTING: TBD%)

Description & Requirements PP 6.1 Strategy to influence suppliers to reduce their GHG emissions
Short description of indicator The company has a strategy, ideally governed by policy and integrated into business decision making, to influence, enable, or otherwise shift suppliers’ choices and behavior in order to reduce GHG emissions.
Data requirements

The questions from the information request that are relevant to this indicator are

  • Details of the methods of supplier engagement, strategy for prioritizing supplier engagements and measures of success - [C12.1a]
  • Number of suppliers with whom the company is engaging, the proportion of the total spend that they represent, part of the inclusive Scope 1+2 carbon emissions - [C12.1a]
  • If data on suppliers’ GHG emissions and climate change strategies are available, explain how the company makes use of that data- [C12.1a]

OR/AND

  • List of environmental contract clauses in purchasing & suppliers’ selection process
How the Analysis will be done

The analyst checks if the policy or strategy exists and assesses if it targets suppliers’ behavior through specific actions undertaken by the company. The strategy has to mention whether:

  • GHG emissions reduction is part of the goal. If the strategy only mentions other elements of an ecological footprint, then it is not sufficient.
  • Suppliers are engaged either directly through education, collaboration or compensation, or indirectly through company regulation.
  • It is widespread. The strategy has to apply to the main company suppliers.

Calculation of the score:

A maximum of 100% is scored if the strategy includes all three aspects mentioned above.

 

Rationale PP 6.1 Strategy to influence suppliers to reduce their GHG emissions
Rationale of the indicator

A large majority GHG emissions for companies from the PP sector occurs during industrial processes (pulping and paper-making) and as the sector organization lies on an integrated supply chain, each player have a responsibility in trying to engage their suppliers in reducing GHG emissions. The value chain begins from forest harvest areas and goes until converters who complete the final product. This can involve several industrial segments and implicate several intermediaries.

Since a significant part of emissions associated with retailers lies downstream with the use of sold products, and retailers have a lot of influence over what their customers buy and how to influence consumption patterns, an effective and coordinated engagement strategy is essential for a low-carbon transition.

As noted in the CDP Supply chain report [18], supply chains are critical levers for action, with GHG emissions often being outside the company’s operational scope 1+2 emissions. Supply chains are also a key element of a company’s climate-related risks. Supply chains must be resilient systems that consider regulatory risk, minimize adverse contributions to climate change, and adapt to climate-related disturbances ranging from resource scarcity to infrastructure damage from extreme weather events.

Scoring rationale:

The scoring of elements in the way that it is presented is similar to the CDP scoring methodology, whereby a narrative answer that details a certain strategy is checked for whether it includes certain elements that the ACT assessment deems vital for any sound supply chain strategy.

 

5.3.6.2 - PP 6.2 ACTIVITIES TO INFLUENCE SUPPLIERS TO REDUCE THEIR GHG EMISSIONS (WEIGHTING: TBD%)

 

Question for the public consultation

 

Q12: What type of actions/collaboration could a company from pulp and paper engage with their suppliers, to encourage and increase the recovery rate of wastepaper and paperboard?

 

Description & Requirements PP 6.2 Activities to influence suppliers to reduce their GHG emissions
Short description of indicator The company participates in activities that help, influence or otherwise enable suppliers to reduce their GHG emissions. The indicator aims to be a holistic measure of these activities to assess how active the company is in reducing the emissions of their products in the value chain across all products.
Data requirements

The questions from the information request that are relevant to this indicator are:

  • List of initiatives implemented to influence suppliers to reduce their GHG emissions, green purchase policy or track record, supplier code of conduct [C12.1a]
How the Analysis will be done

The analyst assigns a maturity score based on the company’s demonstration of engagement with its suppliers, expressed in the following maturity matrix. This indicator evaluates how a company and its suppliers, can paint a picture of the company’s level of active engagement. The choice of sustainable purchased product is an important lever to help the company to apply its low-carbon transition

A company that is placed in the ‘Low-carbon aligned’ category receives the maximum score. Companies that are at lower levels receive a partial score, with 0 points awarded for having no engagement at all.

Rationale PP 6.2 Activities to influence suppliers to reduce their GHG emissions
Rationale of the indicator

While measurement of strategy as in PP 6.1 is important, measuring activities and their outcome is more insightful with regard to the company’s actual emissions reduction activities in the supply chain. Because of the difficulty in measuring this, the existing CDP questionnaire, for example, has not yet adopted an approach to do this. The ACT assessment therefore uses this maturity matrix approach that has been piloted by several other institutions (see scoring rationale).

Scoring rationale:

Because of data availability and complexity, a direct measure of the outcome of supply chain engagement activities is not very feasible at this time. Therefore, the approach of a maturity matrix allows the analyst to consider multiple dimensions of supplier engagement and analyses them together towards a single score for supplier engagement.

 

5.3.7. Client engagement (Weighting: 6-9%)

 

5.3.7.1 - PP 7.1 Strategy to influence customer behaviour to reduce their GHG emissions (WEIGHTING: tbd%)

Description & Requirements AG 7.1 Strategy to influence customer behaviour to reduce their GHG emissions
Short description of indicator This indicator measures whether the company has a strategy, ideally governed by a clear policy and integrated into business decision making, in order to influence its clients to reduce their GHG emissions.
Data requirements

The relevant data for this indicator are:

  • Strategy to influence clients GHG emissions -[C12.1b]
  • % of products/services - [C12.1b]
  • Data on customers’ choices and preferences towards reducing GHG emissions
How the Analysis will be done

The analyst checks if the policy or strategy exists and analyses if it targets customer behaviour through specific actions undertaken by the company. The strategy could mention whether:

  • GHG emissions reduction are part of the goal
  • Customers are engaged either through education or information sharing, or through collaboration & innovation (e.g : Incentives in recycling etc…)

Scoring of the indicator:

Scoring of this indicator is done on a set of narrative data points that do not have a quantitative interpretation. The maturity matrix shown below is used to assess the company strategy.

 

Rationale PP 7.1 Strategy to influence customer behaviour to reduce their GHG emissions
Rationale of the indicator

Relevance of the indicator:

Strategy to influence consumer behavior to reduce GHG impacts is included in the analysis for the following reasons:

1. Given their size and their decision-making power in the value chain, integrated companies can influence the strategy and performance of clients regarding climate.

2. The downstream segment has a key role to play in influencing customer in offering and incentivizing towards low-carbon products

SCORING RATIONALE:

The scoring of elements in the way that it is presented is similar to the CDP scoring methodology, whereby a narrative answer that details a certain strategy is checked for whether it includes certain elements that the ACT assessment deems vital for any sound customer engagement strategy.

 

5.3.7.2 - PP 7.2 Activities to influence customer behaviour to reduce their GHG emissions (WEIGHTING: TBD%)

 

Question for the public consultation

 

Q13: Do you think of any other action with significant climate impact that companies in the sector can implement to reduce their GHG emissions regarding outsourced transportation? (11 eligible actions for now)

 

Description & Requirements PP 7.2 activities to influence customer behaviour to reduce their GHG emissions
Short description of indicator This indicator measures whether the company has a strategy, ideally governed by a clear policy and integrated into business decision making, and activities to influence, enable, or otherwise shift customer choices and behaviour in order to reduce GHG emissions.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Activities to influence clients/customers to reduce their GHG emissions.- [C12.1b]
  • % of products/services
  • Data on customers’ choices and preferences towards reducing GHG emissions
How the Analysis will be done

The activities must mention whether GHG emissions reduction is part of the goal. The analyst assigns a maturity score based on the company’s demonstration of engagement with its customers, expressed in a maturity matrix. This indicator takes a holistic viewpoint on the interventions reported and assesses how together they paint a picture of the company’s level of active engagement with their customers.

The maturity matrix shown below is used to assess the company strategy.

A company that is placed in the ‘Low-carbon aligned’ category receives the maximum score. Companies that are at lower levels receive a partial score, with 0 points awarded for having no engagement at all.

Rationale PP 7.2 Activities to influence customer behaviour to reduce their GHG emissions
Rationale of the indicator

Relevance of the indicator:

Similarly to indicator PP 7.1, here the assessment is focused on the actions currently implemented by the company to influence its customers. While the indicator PP 7.1 is more future-oriented, this one is assessing the activities that the company has done in the past or is currently doing to influence its customers. Both indicators are complementary.

 

5.3.8. Policy engagement (Weighting: 5-7%)

Policy makers can promote CO2 emissions reduction efforts by adopting mandatory reduction policies, such as a gradually rising carbon price or tradeable industry performance standards. An early market signal could enable industries to prepare and adapt their production to transition towards low-carbon processes.

Policy mechanisms should be established which ensure an international competitive level playing field between the different regions producing pulp in order to avoid the risk of carbon leakage. In Europe, most of the pulp and paper mills have become part of the Emission Trading System (EU-ETS).

According to IEA, ideally, these policies would be applied globally at similar strengths. Since pulp and paper products are highly traded, measures will be needed to help ensure a level playing field if the strength of policy efforts differs from one region to another. Possibilities include adopting border carbon adjustments or the free allocation of allowances for emissions below a targeted benchmark in an emissions trading system

 

5.3.8.1 - PP 8.1 Company policy on engagement with trade associations (WEIGHTING: tdb%)

Description & Requirements PP 8.1 Company policy on engagement with trade associations
Short description of indicator The company is not on the Board or providing funding beyond membership of any trade associations that have climate-negative activities or positions. It should also be considered if the company is supporting trade associations with climate-positive activities and/or positions. The company has a constructive policy on what action to take when industry and trade organizations to which it has membership are found to be opposing “climate-friendly” policies.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Public climate change policy positions - [C12.3], include [C12.3f] - [C12.3d]
  • Description of this policy (scope & boundaries, responsibilities, process to monitor and review)
  • Trade associations that are likely to take a position on climate change legislation
How the Analysis will be done

The list of trade associations declared in the CDP data and other external source entries relating to the company is assessed against a list of associations that have climate-negative activities or positions. If the company is part of trade associations that have climate-positive activities and/or positions, this should be considered for the analysis. The analyst evaluates the description and evidence of the policy on trade associations and climate change for the presence of best practice elements and consistency with the other reported management indicators. The company description and evidence are compared to the maturity matrix developed to guide the scoring and a greater number of points will be allocated for elements indicating a higher level of maturity.

Best practice elements to be identified in the test/analysis include:

  • Having a publicly available policy in place
  • The scope of the policy covers the entire company and its activities, and all group memberships and associations
  • The policy sets out what action is to be taken in the case of inconsistencies
  • Action includes the option to terminate membership of the association
  • Action includes the option of publicly opposing or actively countering the association’s position
  • Responsibility for oversight of the policy lies at the top level of the organization
  • There is a process to monitor and review trade association positions

Maximum points are awarded if all these elements are demonstrated.

The following maturity matrix is used to score this indicator:

 

Rationale PP 8.1 Company policy on engagement with trade associations
Rationale of the indicator Trade associations are a key instrument by which companies can indirectly influence policy on climate. Thus, when trade associations take positions that are negative for the climate, companies need to take action to ensure that this negative influence is countered or minimised.

 

5.3.8.2 - PP 8.2 TRADE ASSOCIATIONS SUPPORTED DO NOT HAVE CLIMATE-NEGATIVE POSITIONS (WEIGHTING: TBD%)

Description & Requirements PP 8.2 TRADE ASSOCIATIONS SUPPORTED DO NOT HAVE CLIMATE-NEGATIVE POSITIONS
Short description of indicator The company is not on the Board or providing funding beyond membership of any trade associations that have climate-negative activities or positions. It should also be considered if the company is supporting trade associations with climate-negative activities and/or positions.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • The company shall disclose if (yes or no) it is on the board of any trade associations or provides funding beyond membership - - [C12.3],
  • If yes, the reporter shall provide details of those trade associations that are likely to take a position on climate change legislation
  • The company should attach supporting documentation, if this exists, giving evidence

External sources of data shall also be used for the analysis of this indicator:

  • Press news
  • RepRisk database,
  • Climate Action 100+
  • Ellen Macarthur Foundation (21)
  • EP100 – Climate Group www.theclimategroup.org/project/ep100
  • Low-carbon Technology Partnerships initiative www.wbcsd.org/Programs/Climate-and-Energy/Climate/Low-Carbon-Technology-Partnerships-initiative
How the Analysis will be done

The list of trade associations declared in the CDP data and other external sources entries relating to the company is assessed against a list of associations that have climate-negative activities or positions. The results will be compared to any policy described in PP8.1.

If the company is part of trade associations that have climate-negative activities and/or positions, this should be considered for the analysis.

 

Rationale PP 8.2 TRADE ASSOCIATIONS SUPPORTED DO NOT HAVE CLIMATE-NEGATIVE POSITIONS
Rationale of the indicator

See also the module rationale.

Policy and regulation that act to promote transition to a low-carbon economy are key to the success of the transition. Companies should not oppose effective and well-designed regulation in these areas but should support it.

 

5.3.8.3 - PP 8.3 POSITION ON SIGNIFICANT CLIMATE POLICIES (WEIGHTING: TBD%)

Description & Requirements PP 8.3 POSITION ON SIGNIFICANT CLIMATE POLICIES
Short description of indicator The company is not opposed to any significant climate relevant policy and/or supports climate friendly policies.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • The company should attach supporting documentation, if this exists, giving evidence on the position of the company on significant climate policies (public statements, etc.). [C12.3f]
  • The company shall disclose details of the issues on which it has been directly engaging with policy makers and its proposed legislative solution. [C12.3d]

External sources of data shall also be used for the analysis of this indicator (e.g. RepRisk database, press news, actions in standard development)

How the Analysis will be done

The analyst evaluates the description and evidence on the company’s position on relevant climate policies for the presence of best practice elements, negative indicators and consistency with indicator PP 8.1. The company description and evidence are compared to the maturity matrix developed to guide the scoring and a greater number of points are allocated for elements indicating a higher level of maturity.

Maturity matrix contents may include (decreasing maturity):

  1. The company publicly supports relevant significant climate policies
  2. No reports of any opposition to climate policy
  3. Reported indirect opposition to climate policy (e.g. via a trade association)
  4. Reported direct opposition to climate policy (third-party claims are found)
  5. The company publicizes direct opposition to climate policy (e.g. direct statement issues or given by a company representative in a speech or interview)

The following maturity matrix is used to score this indicator.

A company that is placed in the ‘Low-carbon aligned’ category receives the maximum score. Companies that are at lower levels receive a partial score, with 0 points awarded for having no engagement at all.

Rationale PP 8.3 Position on significant climate policies
Rationale of the indicator Policy and regulation that acts to promote transition to a low-carbon economy is key to the success of the transition. Companies should not oppose effective and well-designed regulations in these areas but should support it.

 

5.3.8.4 - PP 8.4 COLLABORATION WITH LOCAL PUBLIC AUTHORITIES (WEIGHTING: TBD%)

 

Question for the public consultation

[if you are from the pulp and paper industry, please precise if you are a pulp maker, paper manufacturer or paper converter], what kind of collaborations do you develop with local authorities?

Q14: What relevant actions/collaborations could be implemented with local authorities from the pulp and paper sector?

 

Description & Requirements PP 8.3 Interaction with local public authorities
Short description of indicator The company has established an effective dialogue with local public authorities to improve the implementation of measures to reduce emissions from the overall food value chain.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Public climate change policy positions
  • Description of this policy (scope & boundaries, responsibilities, process to monitor and review)
How the Analysis will be done

The analyst evaluates the description and evidence on the company’s interaction with local public authorities. The company description and evidence are compared to the maturity matrix developed to guide the scoring and a greater number of points are allocated for elements indicating a higher level of maturity.

The scoring will be dependent on the type of company. The analyst will evaluate the capacity of influence of the company and adapt the level of indulgence used to assess this indicator.

The following maturity matrix is used to score this indicator.

 

Rationale PP 8.3 Interaction with (local) public authorities
Rationale of the indicator Partnerships with local public authorities and NGOs implementing climate policies or pilot programs reveal the company’s ambition to go beyond the existing regulation and the supply and demand law.

 

5.3.9. Business model (Weighting: 10%)

 

5.3.9.1 - PP 9.1 Integration of the low-carbon and circular economy in the current and future business models (WEIGHTING: 10%)

 

Question for the public consultation

 

Q15: Are there other business models promoting low-carbon products or circular economy, in addition to those provided in the list ?

 

Description & Requirements PP 9.1 Integration of the low-carbon and circular economy in the current and future business models
Short description of indicator An assessment of the company preparedness to be profitable and viable in a low-carbon economy by supplying low-carbon products and a business model integrating circular economy.
Data requirements

The questions comprising the information request that are relevant to this indicator are:

  • Details of business model(s) shifting to supplying low-carbon product: Description of business activity, stage of development, activity timeframe, indicator of business size (over activity timeframe), business sizeVariation of [C-ST4.9], [C4.3c]
  • What are your future plans for this activity?
  • What is the deployment time-frame?
  • How do you manage this business plan deployment?
How the Analysis will be done

The analysis is based on the company’s degree of activity in one of the future business model areas.

Relevant business activity areas for this indicator could be for example:

  • Development of low-carbon pulp and paper products:
    • Light-weight paper making
    • Reusable packaging
    • Development of products as substitute to use of plastics
    • Products integrating new raw materials
  • Development of products based on cellulosic fibers for other industries :
    • Bio-chemicals
    • Pharmaceuticals
    • Textiles
    • Etc….
  • Development of biorefineries and, eventually, selling biofuels/biogas to other sectors
  • Selling waste heat from pulp and paper processes

This list of activities is based on identified business models in reports and literature related to the Pulp and Paper industry (CEPI,2017 [7]; CEPI 2021 [17]; Material economics, 2019 [18]; Reinvent decarbonisation; 2018 [19]; Moya & al, 2017 [12]). The analyst can include other business models related to low-carbon products or the circular economy, if enough evidence is provided by a company.

To be assessed, the company must have at least one business model promoting climate mitigation, climate adaptation being another dimension to integrate. If several business models are developed by the company, the final score will be the one given to the most mature business model (usually the one that also has the highest score). The company will not be penalized if it has built a mature business model, and also explores other tracks (which would be scored with a lower score).

 

CALCULATION OF THE SCORE:

For companies to align with a low-carbon future, it is expected that they pursue at least one of these future business model pathways and integrate them into their strategic plans. The analyst evaluates the description and evidence of the company’s degree of activity in one of the future business model areas for the presence of best practice elements and consistency with the other reported management indicators. The company description and evidence are compared to the maturity matrix developed to guide the scoring and a greater number of points are allocated for elements indicating a higher level of maturity.

The minimum requirement for points to be awarded is that some level of exploration of one or more of these relevant business areas has started. This could include participation in collaborations, pilot projects, or research funding.

Best practice elements to be identified in the test/analysis include:

  • The company has developed a mature business model that integrates one or many of the above elements
  • The business activity is profitable
  • The business activity is of a substantial size
  • The company is planning to expand the business activity
  • Expansion will occur on a defined timescale

Maximum points are awarded if all these elements are demonstrated.

Rationale PP 9.1 business activities shifting supply from highly emissive to low-carbon products
Rationale of the indicator The objective it to recognize, value and incentive company’s exploring business model aligned with a low-carbon society and circular economy.

 

 

6. Assessment

➔ NOTA BENE
  • ACT provides guidelines concerning the scope and boundaries of the sector covered by this methodology to determine which type of GHG emissions are included or excluded. However, it does not provide tools and databases to measure and compute these emissions. In particular, the choice of emission factors does not fall under the responsibility of the ACT methodology. ACT recommends using company-specific emission factors, or if unavailable, standard emission factors recognized in the sector.
  • The analyst should pay high attention to the way the GHG emissions are reported by the company and especially if they are aligned with boundaries of the activity benchmark.

6.1. Sector, activity and company benchmarks

 

6.1.1 Sector scenario

The fundamental target to achieve for all organizations is to contribute to not exceeding a threshold of 2⁰C global warming compared to pre-industrial temperatures.

The sector scenario is based on Energy Technology Perspectives 2017 (ETP 2017) [4] from IEA. .

It is firstly based on a global carbon budget (1055 GtCO2 from 2014 to 2050) provided by IPCC 2014 that gives a minimum of 66% chance probability of remaining below +2°C by the end of the century compared to pre-industrial temperatures (Representative Concentration Pathway – RCP – 2.6). This budget is then allocated to different sectors by IEA based on historical data and trends, statistical information, socio-economic assumptions, exogenous material demand projections, and expert inputs.

 

6.1.2. Mechanisms to compute the sector benchmark

The mechanisms to compute the sector benchmark follows the same approach as the one from SBTi for the Sectoral Decarbonization Approach (SDA) [20]. It is expressed in tCO2 / ton of paper and board per year (annual scope 1 + 2 emissions related to pulp and paper manufacturing processes divided by the annual material production).

The computation uses the following methodology for each year from 2014 to 2050:

  • Annual scope 1 emission intensity of the sector (in tCO2 / ton of paper and board): annual “Sub-sector CO2 emissions” from ETP 2017 (i.e. scope 1 emissions related to pulp and paper processes) is divided by the annual estimated total material production (tons of paper and board – output of the paper and board manufacturing stage) also provided by ETP 2017 to estimate the annual estimated scope 1 CO2 emission intensity of the sector.
  • Annual scope 2 emission intensity (in tCO2 / ton of paper and board): total electricity consumption of the sector provided by ETP 2017 is multiplied by the estimated annual World grid intensity r (in gCO2/kWh) which is calculated by dividing the ”Sub-sector CO2 emissions” of the power utilities sector by the total electricity generation (annual scope 1 emission intensity of the power utilities sector). This enables the calculation of the annual total scope 2 CO2 emissions of the pulp and paper sector. Then this data is divided by the total material production to estimate the annual scope 2 CO2 emission intensity of the sector. It should be noted that the scope 2 emission pathway does not include imported heat as “there is a lack of 2 °C decarbonization models for the heat and steam sectors” [20]. Nevertheless, SBTi recommends that “companies model purchased heat and steam related emissions as if they were part of their direct (i.e. scope 1) emissions” [20] Imported heat is estimated to represent around 5% of total final energy consumed by the sector according to IEA in its latest scenario (SDS scenario) which goes from 2000 to 2030.

The scope of IEA scenario includes the 3 following activities: pulp production, paper and board manufacturing, and paper and board converting (ISIC Division 17).

 

6.1.3. Disaggregation of the sector scenario to build 3 activity benchmarks

In order to compare companies to an appropriate benchmark with the same scope (e.g., a company producing pulp only against a benchmark on pulp activity only), we would like to disaggregate the IEA scenario into 3 scenario (one for each of the activities it includes). As this disaggregation is kept internally by IEA, we try to estimate the share of each activity in the total “sub-sector CO2 emissions” (scope 1 emissions related to pulp and paper manufacturing processes) and sector electricity consumption (activity data needed to calculate scope 2 emissions related to pulp and paper manufacturing processes) that are provided by IEA from 2014 to 2050.

The computation mechanisms of the activity benchmark remain the same as the ones used for the sector benchmark.

This disaggregation is still under development. Please find below the methodology that we plan to use.

Questions for the public consultation

 

Q16: Does the methodology explained below seem relevant to you?

 

Q17: Do you know other trustworthy databases that could be useful for the disaggregation?

 

To create a proper activity benchmark for each of the 3 activities within the scope of IEA ETP 2017 scenario / ACT Pulp & paper methodology we need:

 

1. THE STARTING POINT (in 2014)

Goal: defining the scope 1 and 2 emissions (in MtCO2) of each of the 3 activities at the initial year of the IEA scenario (2014) based on IEA scenario.

Methodology: for that, we need to estimate the share (in %) of each of the 3 activities at the initial year (2014) regarding the 2 following data categories in IEA scenario:

  • Sub-sector CO2 emissions (scope 1 emissions related to pulp and paper manufacturing processes)
  • Electricity consumption (in PJ – activity data used to calculate scope 2 emissions by multiplying it to the World grid intensity in gCO2/kWh also using IEA scenario on the Power Utilities sector, as SBTi does)

Example with the first data category (% and figures below are fictitious)

  • Sub-sector CO2 emissions in 2014 (230 MtCO2):
    • 10% pulp production (so 23 MtCO2)
    • 75% paper & board manufacturing (so 172 MtCO2)
    • 15% paper & board converting (so 35 MtCO2)

 

Defining the starting point of the 2 data categories in 2014 for the 3 activities

We have identified 3 databases to disaggregate the IEA values in 2014 for sub-sector CO2 emissions and sector electricity consumption.

  • RISI database, which provides energy consumptions for close to 7000 pulp and/or paper & board facilities across the world (but not paper and board converting facilities)
  • Ecoinvent database, which provides average scope 1 emission intensity (in tCO2/t of material) and electricity consumption intensity (in kWh/kg of material) for different industrial processes in different regions of the world. The database is widely used by Life-Cycle Analysis (LCA) analysts.
  • FAO database, which provides 2014’s volume of production for the different pulp processes (output of the pulp production activity) and 10 general grades of paper and board (output of the paper & board manufacturing processes).

The methodology would be:

1.Calculate the total scope 1 CO2 emissions and total electricity consumption of each of the 3 activities in 2014 using the databases above.

  • Using RISI databases for pulp production activity, and paper and board activity, and Ecoinvent coupled with FAO for the converting activity (see the bullet point below for the methodology)
  • OR using Ecoinvent to get the scope 1 emissions intensity and electricity consumption intensity of the different pulp production processes, paper and board manufacturing processes (per grade of paper and board), and paper and board converting processes that we multiply by the related volume of production provided by FAO

2.Then, calculate the share of each activity (in %) regarding the total sector scope 1 CO2 emissions, and total sector electricity consumptions from calculations using the databases above (e.g., for scope 1, and for pulp production, the share in % = total scope 1 emissions due to pulp production using the databases divided by the sum of scope 1 emissions of the 3 activities using the databases).

3.At last, apply this share (in %) to the 2014 value provided by IEA for the sector (in MtCO2 for scope 1, and in PJ for electricity consumption) to get the starting point of the 3 activities for the 2 data categories.

As activity scope 1 emissions are provided by the calculations above, we need toto estimate the scope 2 emissions of the activity in 2014 based on IEA scenario. For that we multiply the estimated total electricity consumption of the activity in 2014 (provided by the previous calculations) by the World grid intensity (in gCO2/kWh, also calculated using IEA scenario for the Power Utilities sector – as SBTi does).

This way, we extrapolate from IEA scenario the scope 1 and 2 emissions of each activity in 2014.

 

2.THE PROJECTED PATHWAY (from 2015 to 2050)

Goal: defining the scope 1 and 2 emissions (in MtCO2) of each of the 3 activities from 2015 to 2050 based on IEA dataset.

For each of the 3 activities, we apply to their 2 data categories (below) the same annual rate as the one provided by IEA scenario for the sector (% below are fictitious):

  • Sub-sector CO2 emissions (scope 1 emissions related to pulp and paper manufacturing processes): -3,5% between 2014 and 2015, […], -4,5% between 2024 and 2025, etc.
  • Electricity consumption (in PJ – used for scope 2 emissions calculations): +1% between 2014 and 2015, […], +0,8% between 2025 and 2026, etc.

Example with Pulp production for the first data category (% allocation and figures below are fictitious)

  • Pulp production accounts for 10% of the sub-sector CO2 emissions (so 23 MtCO2) in 2014. Applying the sectoral annual decarbonization rate for scope 1 emissions between 2014 and 2015, pulp production accounts for 22 MtCO2 in 2015. Pulp production still represents 10% of the sub-sector CO2 emissions.

As activity scope 1 emissions are provided by the calculations above, we need to estimate the scope 2 emissions of the activity for each year from 2015 to 2050 based on IEA scenario. For that, we multiply the estimated total electricity consumption of the activity for each year (provided by the calculations just above) by the World grid intensity of the inherent year (in gCO2/kWh, also provided by IEA in ETP 2017 for Power Utilities).

This way, we extrapolate from IEA scenario the scope 1 and 2 emissions of each activity for each year from 2015 to 2050.

 

3. THE SCOPE 1 AND 2 EMISSION INTENSITY OF EACH ACTIVITY FROM 2014 TO 2050

IEA provides the estimated paper and board production from 2014 to 2050.

We have, for each activity, and for each year from 2014 to 2050:

  • The estimated total scope 1 emissions
  • The estimated total scope 2 emissions
  • The total paper and board production

Thus, we can calculate the scope 1 and 2 emission intensity (in tCO2/t of paper and board) for each activity, for each year from 2014 to 2050.

 

6.1.4. Mechanisms to compute the company benchmark

The company benchmark (CBG as in the indicator calculation) is the company’s allocated decarbonization pathway. It is derived from the activity benchmark and is expressed in tCO2 / ton of paper and board (scope 1 + 2 emissions related to pulp and paper manufacturing processes divided by the material production).

The company benchmark is based on the convergence mechanism (as SBTi does). This allocation takes the company’s emissions intensity in the initial year and converges it to the sector’s emissions intensity in 2050 at a rate that ensures that the corresponding sectoral carbon budget is not exceeded. The rate of convergence is determined by a market share parameter that will require the company to reduce faster its carbon intensity if its market share increases (based on projections on the total amount of paper and board production), and a convergence index based on the emissions reduction pathway of the activity benchmark.

 

Figure 11 - ILLUSTRATION OF THE CONVERGENCE MECHANISM

 

The example above shows that companies starting from a higher emissions intensity compared to the activity benchmark will have a steeper decarbonization pathway than companies starting from a lower carbon intensity. This way, past actions or inaction to reduce emissions intensity is considered.

 

6.2. Quantitative benchmarks used for the indicators

The following table lists the benchmarks used for the quantitative indicators and their sources:

Table 6: Benchmarks for the quantitative indicators

 

6.3. Weightings

The selection of weights for both the modules and the individual indicators was guided by the principles of value of information, impact of variation, future orientation and data quality sensitivity. See the ACT Framework [1] document for more information.

 

7. Rating

The ACT rating shall comprise:

  • A performance score
  • A narrative score
  • A trend score

These pieces of information shall be represented within the ACT rating as follows:

  1. Performance score as a number from 1 (lowest) to 20 (highest)
  2. Narrative score as a letter from E (lowest) to A (highest)
  3. Trend score as either “+” for improving, “-” for worsening, or “=” for stable.

In some situations, trend scoring may reveal itself to be unfeasible depending on data availability. In this case, it should be replaced with a “?”.

The highest rating is thus represented as “20A=”, the lowest as “1E=” and the midpoint as “10C=”.

Table 7: Lowest, highest and midpoint for each ACT score type

See the ACT Framework [1] for general information and methodology on the ACT rating.

 

7.1. Performance scoring

TO BE COMPLETED with figure after road test phase.

 

7.2. Narrative scoring

Narrative scoring shall be performed in compliance with the ACT Framework, assessing the company on the 4 following criteria:

  • Business model and strategy
  • Consistency and credibility
  • Reputation
  • Risk

The information reported in Module 2 and 4 shall be considered with peculiar attention for the narrative analysis and narrative scoring for the TR sector: with this information, the analyst can take a holistic view on the company’s actions to perform a low-carbon transport service, and assess the consistency of actions taken with respect to targets, business model and engagement with other stakeholders.

No other sector-specific issue impacting the narrative scoring for this sector has been identified to date.

Suggestion to integrate climate change adaptation: adding the following questions:

 

Business model and strategy: Does the business model of the company include a climate change adaptation strategy?

 

Risk: Is the plan realistic in regard to the expected changes in climate and the impacts of climate change in the short, medium and long terms?

 

7.3. Trend scoring

Trend scoring shall be performed in compliance with the ACT Framework.

To apply the trend scoring methodology presented in the ACT Framework, the analyst should identify the trends from the existing data infrastructure based on the data points and/or indicators that can indicate the future direction of change within the company.

The table below includes an overview of which indicators/data points could possibly have valuable information about future directions for the PP sector.

Table 8: Relevant performance indicators for trends identification for the Pulp and paper sector

Module Indicator
Targets  
   
Material investments  
   
Intangible investments  
   
   
Sold product performance  
Management  
   
Clients  
   
Business model  
   
   

 

8. Aligned state

The table below presents the response of a low-carbon aligned company of the sector to the 5 questions of ACT:

  • What is the company planning to do? [Commitment]
  • How is the company planning to get there? [Transition Plan]
  • What is the company doing at present? [Present]
  • What has the company done in the recent past? [Legacy]
  • How do all of these plans and actions fit together? [Consistency]
Figure 10: Aligned state for companies in the pulp and paper sector

 

 

9. Integration of Physical risks and Adaptation in ACT

 

9.1. Introduction and context

This is a first version of a maturity matrix that aims to integrate climate physical risks and adaptation in ACT.

A specific method will be developed with a separate score, modules specific to climate risks and adaptation, and a possible joint assessment with the mitigation part of ACT. This is a first draft of its integration in ACT historical assessment method.

To be noted:

Each line (row) of the matrix corresponds to a category that is independent from others. Categories are just grouped by module. The matrix is composed of two dimensions, the physical climate risks and adaption. Each of these dimensions contains several modules.

Scores and weightings are detailed in this document.

The lists of impacts and vulnerabilities for the different activities of a company along its value chain are not exhaustive. Any other impact or vulnerability that is relevant for the company can be considered and analysed.

Any comment or feedback is welcome.

Two questions are for consultation.

A glossary of climate physical risks and adaptation terms is available at the end of this document.

9.2. Maturity Matrix

The two dimensions of the maturity matrix are climate physical risks and adaptation.

Physical climate risks correspond to the potential for negative consequences from physical climate events or trends. Risks from climate change impacts arise from the interaction between hazard (triggered by an event or trend related to climate change), vulnerability (susceptibility to harm) and exposure (people, assets or ecosystems at risk) [23].

Hazards refer to the potential occurrence of a natural or human-induced physical event or trend or physical impact that may cause loss of life, injury, or other health impacts, as well as damage and loss to property, infrastructure, livelihoods, service provision, ecosystems and environmental resources. In this note, the term hazard usually refers to climate-related physical events or trends or their physical impacts. Thus, it includes processes that range from brief events, such as severe storms, to slow trends, such as multi-decade droughts or multi-century sea level rise [23].

Exposition is the degree to which a company’s value chain (e.g., assets, operations, supply chain, customers) has the potential to be impacted by physical climate hazards due to its geographic location. These metrics should link part of a company’s value chain (e.g., physical assets) with specific physical climate hazards (e.g., tropical cyclones) [23].

Vulnerability is the propensity of different parts of a company’s value chain to suffer negative impacts when exposed to and then impacted by physical climate hazards. These metrics should assess specific characteristics of a company’s value chain (e.g., water intensity) that may make that part of the value chain more or less likely to suffer negative impacts from physical climate hazards [24].

The second dimension of the matrix is adaptation. It is the process of adjustment to actual or expected climate and its effects. In human systems, adaptation seeks to moderate or avoid harm or exploit beneficial opportunities. In some natural systems, human intervention may facilitate adjustment to expected climate and its effects.

Adaptation options exist in all sectors, but their context for implementation and potential to reduce climate-related risks differs across sectors and regions. Some adaptation responses involve significant co-benefits, synergies and trade-offs [23].

Here is presented the complete physical risks and adaptation maturity matrix.

CLIMATE PHYSICAL RISKS DIMENSION

 

ADAPTATION DIMENSION

 

9.3. Weightings

The weightings on 100% are distributed equally among Physical risks and Adaptation dimensions. Analysis and Organizational capacity modules are both fixed to 25%. If a company is not concerned by one or several modules between Supply chain, Production, Logistics or Demand, the analyst can decide

  • To attribute a weighting of 0% for it and to redistribute the corresponding weightings
  • To change marginally the weightings between these four modules for another distribution that could be more appropriate for the company

The final score of the complete matrix will be computed on 20 thanks to a weighted average. Two other scores will be computed, the physical risks score on 100% and the adaptation score on 100%.

Do you think this scoring is appropriate? What about the weightings?

 

 

Questions for consultation

 

How do we want to assess the “Demand and sales” (5) aspect for the company?

OPTION 1: keep the module as it is now

OPTION 2: Modify the « Demand & sales » module (5) to make it more business related and integrate more in it the notion of climate-related opportunities, as well as keeping the risks analysis dimension

 

How do we want to address the notion of climate-related opportunities in the matrix?

 

Climate-related opportunities in the ACT framework are defined as follow:

It is the potential positive impacts related to climate change on an organisation. It will vary depending on the region, market and industry in which an organisation operates. In the ACT framework, climate-related opportunity focuses on opportunities to adapt to market shifts driven by physical climate impacts and cater to any resulting new market needs, that is to say, the fundamental shifts in climate over the longer term may affect value chains and drive new consumer needs. For example, technology to keep buildings cool, along with water- and energy-efficient technologies, or crops that are better suited to chronic changes in precipitation and temperature. (EBRD)

  • OPTION 1: Add « Identification climate-related opportunities related to climate change » at the low-carbon aligned level in the matrix for
    • Analysis module (1)
    • Production module (3)
  • OPTION 2: Modify the « Demand & sales » module (5) to make it more business related and integrate more in it the notion of climate-related opportunities, as well as keeping the risks analysis dimension.

 

10. References

 

[1] ACT Initiative , “ACT Framework - Version 1.1,” 2019.

[2] ACT Initiative, “ACT Guidelines for the development of sector methodologies - Version 1.0,” 2018.

[3] I. C. f. t. E. Commission, Study on energy efficiency and energy saving potential in industry and on possible policy mechanism, 2015. 

[4] International Energy Agency, “Energy Technology Perspectives 2017,” 2017.

[5] G. Protocol, New Greenhouse Gas Protocol Guidance on Carbon Removals and Land Use, 2019. 

[6] SBTi, Forest, Land and Agriculture (FLAG project), 2021. 

[7] CEPI, Framework for Carbon Footprints for paper and board products, 2017. 

[8] UPM, Greenhouse Gas Inventory 2020, 2021. 

[9] M. Group, Sustainable Development Report, 2019. 

[10] Sappi, 2020 Group Sustainability Report, 2020. 

[11] WRI & WBCSD, “GHG Protocol - Technical Guidance for Calculating Scope 3 Emission,” 2011.

[12] M. J. A. a. P. C. C, Energy efficiency and GHG emissions: Prospective scenarios for the pulp and paper industry, 2018. 

[13] IPCC, Guidelines for National Greenhouse Gas Inventories, 2006. 

[14] E. Commission, Best Available Techniques (BAT) Reference Document for the Production of Pulp, Paper and Board, 2015. 

[15] Global Canopy, “The Forest 500: 2019 Company Assessment Methodology,” Oxford, UK, 2019.

[16] WWF, “Questionnaire for Pulp and Paper Companies to participate in the WWF Environmental paper company index,” 2019.

[17] CEPI, Energy solutions forum, 2021. 

[18] M. economic, A net-zero transition for EU industry - What does it mean for the pulp & paper industry?, 2020. 

[19] E. a. Nilsson, Climate innovations in the paper industry: Prospects for decarbonisation – Reinvent project, 2018. 

[20] S. B. Targets, The sectoral Decorbanization Appoach, 2014. 

[21] Science-Based Targets, “SBTi recommendations and criteria,” 2019.

[22] I. Consulting, Industrial innovation : Pathways to deep decarbonization of industry, 2017 . 

[23] IPCC, Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change, Geneva, Switzerland., (2014). 

[24] WRI., Assessing physical risks from climate change: Do companies and financial organization have sufficient guidance ? - Working Paper, 2021. 

[25] TEG., Taxonomy Report, Technical Annex: Updated methodology & Updated Technical Screening Criteria., 2020. 

[26] E. &. GCECA, Advancing TCFD Guidance on physical climate risks and opportunities. 

[27] ADEME, Capacité d'adaptation au changement climatique des entreprises : recueil d'experiences 2019. Angers, France., 2019. 

[28] ADEME, Diagnostic des impacts du changement climatique sur une entreprise : recueil international d'expériences, adaptation au changement climatique 2020., Angers, France, 2020. 

[29] Internationational Energy Agency, “Data & Statistics,” [Online]. Available: https://www.iea.org/data-and-statistics/?country=WORLD&fuel=CO2%20emissions&indicator=CO2%20emissions%20by%20sector.

[30] ISO, “ISO/TR 14069:2013 Greenhouse gases — Quantification and reporting of greenhouse gas emissions for organizations — Guidance for the application of ISO 14064-1,” 2013.

[31] W. Jemiolo, “Life cycle assessment of current and future passenger air transport in Switzerland,” 2015.

[32] Science-Based Targets, “Transport Science-Based Target Setting Guidance,” 2018.

[33] ISO, “ISO/AWI 14083: Greenhouse gas management and related activities — Quantification and reporting of greenhouse gas emissions of transport operations,” Under development.

[34] ISO, “ISO 14064-1:2018 Greenhouse gases — Part 1: Specification with guidance at the organization level for quantification and reporting of greenhouse gas emissions and removals,” 2018.

[35] CDP, "CDP Climate Change 2020 Questionnaire," 2020. [Online]. Available: https://guidance.cdp.net/en/tags?cid=13&ctype=theme&gettags=0&idtype=ThemeID&incchild=1&microsite=0&otype=Questionnaire&page=1&tgprompt=TG-124%2CTG-127%2CTG-125.[36] W. R. I. (WRI), “Creating a Sustainable Food Future,” Washington DC, 2019.

[37] Life project, “INDUFOOD - Reducing GHG emissions in the food industry through alternative thermal systems based on induction technology,” 2011.

[38] Food and Agriculture Organization of the United Nations (FAO), “Food Wastage Footprint & Climate Change,” 2015.

[39] Food and Agriculture Organization of the United Nations (FAO), “Global Livestock Environmental Assessment Model (GLEAM),” [Online]. Available: http://www.fao.org/gleam/en/. [Accessed 2020].

[40] T. Garnett, “Where are the Best Opportunities for Reducing Greenhouse Gas Emissions in the Food System (including the food chain)?,” Food Policy, pp. 23-32, 2011. 

[41] SBTi, “SDA Transport Tool - sectoral benchmark pathway definition,” 2017.

[42] International Transport Forum, “Transport Outlook 2019,” OECD, 2019.

[43] ICCT, “CO2 emissions from commercial aviation, 2018,” 2019.

[44] IATA, “Economic performance of the airline industry, mid-year report,” 2017.

[45] Energy Transitions Commission, “Mission possible: reaching net-zero carbon emissions from harder-to-abate sectors by mid-century", Energy Transitions Commission,” 2018.

[46] The Geography of Transport systems, [Online]. Available: https://transportgeography.org/?page_id=5423.

[47] UNPRI, “INVESTOR EXPECTATIONS ON CORPORATE CLIMATE LOBBYING,” 2015.

[48] EU Technical Expert Group on Sustainable Finance, “Taxonomy Technical Report,” 2019.

[49] Food and Agriculture Organization of the United Nations (FAO), “Toolkit Reducing the Food Wastage Footprint,” 2013.

[50] ACT Initiative, “ACT Sector Methodology - Retail,” 2019.

[51] ACT Initiative, “ACT Sector Methodology - Transport,” 2020.

[52] Food and Agriculture Organization of the United Nations (FAO), “Agriculture, Forestry and Other Land Use Emissions by Sources and Removals by Sinks,” 2014.

 

 

Glossary

   
2 degrees (2°C) A political agreement was reached at COP21 on limiting global warming to 2°C above the pre-industrial level (COP21: Why 2°C?). A 2°C scenario (or 2°C pathway) is a scenario (or pathway) compatible with limiting global warming to 2°C above the pre-industrial level.
ACT The Assessing low-Carbon Transition (ACT) initiative was jointly developed by ADEME and CDP. ACT assesses how ready an organization is to transition to a low-carbon world using a future-oriented, sector-specific methodology (ACT website).
Action gap In relation to emissions performance and reduction, the action gap is the difference between what a given company has done in the past plus what it is doing now, and what has to be done. For example, companies with large action gaps have done relatively little in the past, and their current actions point to continuation of past practices.
Actions that do not (significantly) harm mitigation, biodiveristy, health and pollution

According to the European Taxonomy proposed by the Technical Expert Group, economic activities making a substantial contribution to climate change mitigation or adaptation must be assessed to ensure they do not cause significant harm to all remaining environmental objectives. An activity contributing to climate change adaptation must avoid significant harm to climate change mitigation and the other four environmental objectives (and vice versa):

- Sustainable use and protection of water and marine resources

- Transition to a circular economy, waste prevention and recycling

- Pollution prevention and control

- Protection of healthy ecosystems

This assessment ensures that progress against some objectives are not made at the expense of others and recognises the reinforcing relationships between different environmental objectives [25].

Activity data Activity data are defined as data on the magnitude of human activity resulting in emissions or removals taking place during a given period of time (UNFCCC definitions).
adaptation

The process of adjustment to actual or expected climate and its effects. In human systems, adaptation seeks to moderate or avoid harm or exploit beneficial opportunities. In some natural systems, human intervention may facilitate adjustment to expected climate and its effects.

Adaptation options exist in all sectors, but their context for implementation and potential to reduce climate-related risks differs across sectors and regions. Some adaptation responses involve significant co-benefits, synergies and trade-offs. Increasing climate change will increase challenges for many adaptation options.

Adaptation and mitigation responses are underpinned by common enabling factors. These include effective institutions and governance, innovation and investments in environmentally sound technologies and infrastructure, sustainable livelihoods and behavioural and lifestyle choices [23].

adaptive capacity The ability of systems, institutions, humans and other organisms to adjust to potential damage, to take advantage of opportunities, or to respond to consequences [23].
ADEME Agence de l'Environnement et de la Maîtrise de l'Energie; The French Environment and Energy Management Agency (ADEME webpage).
Alignment The ACT project seeks to gather information that will be consolidated into a rating that is intended to provide a general metric of the 2-degree alignment of a given company. The wider goal is to provide companies specific feedback on their general alignment with 2-degrees in the short and long term.
Analyst Person in charge of the ACT assessment.
Assess Under the ACT project, to evaluate and determine the low-carbon alignment of a given company. The ACT assessment and rating will be based on consideration of a range of indicators. Indicators may be reported directly from companies. Indicators may also be calculated, modelled or otherwise derived from different data sources supplied by the company. The ACT project will measure 3 gaps (Commitment, Horizon and Action gaps – defined in this glossary) in the GHG emissions performance of companies. This model closely follows the assessment framework presented above. It starts with the future, with the goals companies want to achieve, followed by their plans, current actions and past actions.
Asset An item of property owned by a company, regarded as having value and available to meet debts, commitments, or legacies. Tangible assets include 1) fixed assets, such as machinery and buildings, and 2) current assets, such as inventory. Intangible assets are nonphysical such as patents, trademarks, copyrights, goodwill and brand value.
Barrier A circumstance or obstacle preventing progress (e.g. lacking information on supplier emissions and hotspots can be a barrier to companies managing and reducing their upstream Scope 3 emissions).
Base year According to the GHG Protocol [11] and ISO14064-1, a base year is “a historic datum (a specific year or an average over multiple years) against which a company’s emissions are tracked over time”. Setting a base year is an essential GHG accounting step that a company must take to be able to observe trends in its emissions information (GHG Protocol Corporate Standard).
Benchmark A standard, pathway or point of reference against which things may be compared. In the case of pathways for sector methodologies, a sector benchmark is a low-carbon pathway for the sector average value of the emissions intensity indicator(s) driving the sector performance. A company’s benchmark is a pathway for the company value of the same indicator(s) that starts at the company performance for the reporting year and converges towards the sector benchmark in 2050, based on a principle of convergence or contraction of emissions intensity.
Board Also the “Board of Directors” or “Executive Board”; the group of persons appointed with joint responsibility for directing and overseeing the affairs of a company.
Business model A plan for the successful operation of a business, identifying sources of revenue, the intended customer base, products, and details of financing. Under ACT, evidence of the business model shall be taken from a range of specific financial metrics relevant to the sector and a conclusion made on its alignment with low-carbon transition and consistency with the other performance indicators reported.
Business-as-usual No proactive action taken for change. In the context of the ACT methodology, the business-as-usual pathway is constant from the initial year onwards. In general, the initial year – which is the first year of the pathway/series – is the reporting year (targets indicators) or the reporting year minus 5 years (performance indicators).
Capital expenditure Money spent by a business or organization on acquiring or maintaining fixed assets, such as land, buildings, and equipment.
CDP Formerly the "Carbon Disclosure Project", CDP is an international, not-for-profit organization providing the only global system for companies and cities to measure, disclose, manage and share vital environmental information. CDP works with market forces, including 827 institutional investors with assets of over US$100 trillion, to motivate companies to disclose their impacts on the environment and natural resources and take action to reduce them. More than 5,500 companies worldwide disclosed environmental information through CDP in 2015. CDP now holds the largest collection globally of primary climate change, water and forest risk commodities information and puts these insights at the heart of strategic business, investment and policy decisions (CDP website).
Climate change A change in climate, attributed directly or indirectly to human activity, that alters the composition of the global atmosphere and that is, in addition to natural climate variability, observed over comparable time periods (UNFCCC).
CLIMATE PROJECTION A climate projection is the simulated response of the climate system to a scenario of future emission or concentration of greenhouse gases (GHGs) and aerosols, generally derived using climate models. Climate projections are distinguished from climate predictions by their dependence on the emission/concentration/radiative forcing scenario used, which is in turn based on assumptions concerning, for example, future socio-economic and technological developments that may or may not be realized [23].
climate-related Opportunity

It is the potential positive impacts related to climate change on an organisation. It will vary depending on the region, market and industry in which an organisation operates.

In the ACT framework, climate-related opportunity focuses on opportunities to adapt to market shifts driven by physical climate impacts and cater to any resulting new market needs, that is to say, the fundamental shifts in climate over the longer term may affect value chains and drive new consumer needs. For example, technology to keep buildings cool, along with water- and energy-efficient technologies, or crops that are better suited to chronic changes in precipitation and temperature [26].

Commitment gap In relation to emissions performance, the difference between what a company needs to do and what it says it will do.
Company A commercial business.
Company pathway A company’s past emissions intensity performance pathway up until the present.
Company target pathway The emissions intensity performance pathway that the company has committed to follow from the initial year on until a future year, for which it has set a performance target.
Confidential information Any non-public information pertaining to a company's business.
Conservativeness A principle of the ACT project; whenever the use of assumptions is required, the assumption shall err on the side of achieving 2-degrees maximum.
Consistency A principle of the ACT project; whenever time series data is used, it should be comparable over time. In addition to internal consistency of the indicators reported by the company, data reported against indicators shall be consistent with other information about the company and its business model and strategy found elsewhere. The analyst shall consider specific, pre-determined pairs of data points and check that these give a consistent measure of performance when measured together.
COP21 The 2015 United Nations Climate Change Conference, held in Paris, France from 30 November to 12 December 2015 (COP21 webpage).
Data Facts and statistics collected together for reference and analysis (e.g. the data points requested from companies for assessment under the ACT project indicators).
Decarbonization A complete or near-complete reduction of greenhouse gas emissions over time (e.g. decarbonization in the electric utilities sector by an increased share of low-carbon power generation sources, as well as emissions mitigating technologies like Carbon Capture and Storage (CCS)).
Decarbonization pathway Benchmark pathway (See ‘Benchmark’)
Emission SCENARIO A plausible representation of the future development of emissions of substances that are potentially radiatively active (e.g., greenhouse gases (GHGs), aerosols) based on a coherent and internally consistent set of assumptions about driving forces (such as demographic and socio-economic development, technological change, energy and land use) and their key relationships. Concentration scenarios, derived from emission scenarios, are used as input to a climate model to compute climate projections [23].
Emissions The GHG Protocol defines direct GHG emissions as emissions from sources that are owned or controlled by the reporting entity, and indirect GHG emissions as emissions that are a consequence of the activities of the reporting entity, but occur at sources owned or controlled by another entity (GHG Protocol).
Energy Power derived from the utilization of physical or chemical resources, especially to provide light and heat or to work machines.
exposition / EXposure The presence of people; livelihoods; species or ecosystems; environmental functions, services, and resources; infrastructure; or economic, social, or cultural assets in places and settings that could be adversely affected [23].
exposure metrics Metrics designed to assess the degree to which a company’s value chain (e.g., assets, operations, supply chain, customers) has the potential to be impacted by physical climate hazards due to its geographic location. These metrics should link part of a company’s value chain (e.g., physical assets) with specific physical climate hazards (e.g., tropical cyclones) [23].
financial ressources It is the funds available to implement its adaptive capacity [27].
Fossil fuel A natural fuel such as coal, oil or gas, formed in the geological past from the remains of living organisms.
Future A period of time following the current moment; time regarded as still to come.
Greenhouse gas (GHG) Greenhouse gas (e.g. carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O) and three groups of fluorinated gases (sulfur hexafluoride (SF6), hydrofluorocarbons (HFCs), and perfluorocarbons (PFCs)) which are the major anthropogenic GHGs and are regulated under the Kyoto Protocol. Nitrogen trifluoride (NF3) is now considered a potent contributor to climate change and is therefore mandated to be included in national inventories under the United Nations Framework Convention on Climate Change (UNFCCC).
Guidance Documentation defining standards or expectations that are part of a rule or requirement (e.g. CDP reporting guidance for companies).
HAZARDs

The potential occurrence of a natural or human-induced physical event or trend or physical impact that may cause loss of life, injury, or other health impacts, as well as damage and loss to property, infrastructure, livelihoods, service provision, ecosystems and environmental resources. In this report, the term hazard usually refers to climate-related physical events or trends or their physical impacts.

Thus, it includes processes that range from brief events, such as severe storms, to slow trends, such as multi-decade droughts or multi-century sea level rise [23].

A climate hazard should be appreciated in function of its likelihood, magnitude and duration.

Horizon Gap In relation to emissions performance, the difference between the average lifetime of a company’s production assets (particularly carbon intensive) and the time-horizon of its commitments. Companies with large asset-lives and small time horizons do not look far enough into the future to properly consider a transition plan.
human ressources It is the internal skills and working time that the company uses to improve its adaptive capacity [27].
Incentive A thing, for example money, that motivates or encourages someone to do something (e.g. a monetary incentive for company board members to set emissions reduction targets).
Indicator

An indicator is a quantitative or qualitative piece of information that, in the context of the ACT project, can provide insight on a company’s current and future ability to reduce its carbon intensity. In the ACT project, 3 fundamental types of indicators can be considered:

Key performance indicators (KPIs);

Key narrative indicators (KNIs); and

Key asset indicators (KAIs).

Intensity (emissions) The average emissions rate of a given pollutant from a given source relative to the intensity of a specific activity; for example grams of carbon dioxide released per MWh of energy produced by a power plant.
Intervention Methods available to companies to influence and manage emissions in their value chain, both upstream and downstream, which are out of their direct control (e.g. a retail company may use consumer education as an intervention to influence consumer product choices in a way that reduces emissions from the use of sold products).
Lifetime The duration of a thing's existence or usefulness (e.g. a physical asset such as a power plant).
Long-term Occurring over or relating to a long period of time; under ACT this is taken to mean until the year 2050. The ACT project seeks to enable the evaluation of the long-term performance of a given company while simultaneously providing insights into short- and medium-term outcomes in alignment with the long-term.
Low-carbon scenario (or pathway) A low-carbon scenario (or pathway) is a 2°C scenario, a well-below 2°C scenario or a scenario with higher decarbonization ambition.
Low-carbon solution A low-carbon solution (e.g. energy, technology, process, product, service, etc.) is a solution whose development will contribute to the low-carbon transition.
Low-carbon transition The low-carbon transition is the transition of the economy according to a low-carbon scenario.
low-carbon vehicles and energies  
Manufacture Making objects on a large scale using machinery.
Maturity matrix A maturity matrix is essentially a “checklist”, the purpose of which is to evaluate how well advanced a particular process, program or technology is according to specific definitions.
Maturity progression An analysis tool used in the ACT project that allows both the maturity and development over time to be considered with regards to how effective or advanced a particular intervention is.
Mitigation (emissions) The action of reducing the severity of something (e.g. climate change mitigation through absolute GHG emissions reductions)
Model A program designed to simulate what might or what did happen in a situation (e.g. climate models are systems of differential equations based on the basic laws of physics, fluid motion, and chemistry that are applied through a 3-dimensional grid simulation of the planet Earth).
organizational capacity It is the governance bodies, exchanges, decision-making processes and the management mode that contribute to its adaptive capacity [27].
Pathway (emissions) A way of achieving a specified result; a course of action (e.g. an emissions reduction pathway).
Performance Measurement of outcomes and results.

Note: The definitions of these hazards from the WRI and the IPCC are examples, any other relevant definition and corresponding indicator will be appropriate. 

Sources : WRI based on a review of reports from the IPCC (2014a, 2021, 2018, 2019a, 2019b), Géorisques, and adapted from I4CE

Plan A detailed proposal for doing or achieving something.
Point A mark or unit of scoring awarded for success or performance.
Power Energy that is produced by mechanical, electrical, or other means and used to operate a device (e.g. electrical energy supplied to an area, building, etc.).
Primary energy Primary energy is an energy form found in nature that has not been subjected to any conversion or transformation process. It is energy contained in raw fuels, and other forms of energy received as input to a system. Primary energy can be non-renewable or renewable.
Progress ratio An indicator of target progress, calculated by normalizing the target time percentage completeness by the target emissions or renewable energy percentage completeness.
Relevant / Relevance In relation to information, the most relevant information (core business and stakeholders) to assess low-carbon transition.
Renewable energy Energy from a source that is not depleted when used, such as wind or solar power.
Reporting year Year under consideration.
Representative concentration pathways (rcp)

Scenarios that include time series of emissions and concentrations of the full suite of greenhouse gases (GHGs) and aerosols and chemically active gases, as well as land use/land cover (Moss et al., 2008). The word representative signifies that each RCP provides only one of many possible scenarios that would lead to the specific radiative forcing characteristics. The term pathway emphasizes that not only the long-term concentration levels are of interest, but also the trajectory taken over time to reach that outcome (Moss et al., 2010).

RCPs usually refer to the portion of the concentration pathway extending up to 2100, for which Integrated Assessment Models produced corresponding emission scenarios. Extended Concentration Pathways (ECPs) describe extensions of the RCPs from 2100 to 2500 that were calculated using simple rules generated by stakeholder consultations and do not represent fully consistent scenarios.

Four RCPs produced from Integrated Assessment Models were selected from the published literature and are used in the present IPCC Assessment as a basis for the climate predictions and projections presented in WGI AR5 Chapters 11 to 14 (IPCC, 2013b):

RCP2.6

One pathway where radiative forcing peaks at approximately 3 W/m2 before 2100 and then declines (the corresponding ECP assuming constant emissions after 2100). RCP2.6 is representative of a scenario that aims to keep global warming likely below 2°C above pre-industrial temperatures. The increase of global mean surface temperature by the end of the 21st century (2081–2100) relative to 1986–2005 is likely to be 0.3°C to 1.7°C under RCP2.6.

RCP4.5 and RCP6.0

Two intermediate stabilization pathways and scenarios in which radiative forcing is stabilized at approximately 4.5 W/m2 and 6.0 W/m2 after 2100 (the corresponding ECPs assuming constant concentrations after 2150). The increase of global mean surface temperature by the end of the 21st century (2081–2100) relative to 1986–2005 is likely to be 1.1°C to 2.6°C under RCP4.5, 1.4°C to 3.1°C under RCP6.0.

RCP8.5

It is the scenario with very high GHG emissions. One high pathway for which radiative forcing reaches >8.5 W/m2 by 2100 and continues to rise for some amount of time (the corresponding ECP assuming constant emissions after 2100 and constant concentrations after 2250). Scenarios without additional efforts to constrain emissions (’baseline scenarios’) lead to pathways ranging between RCP6.0 and RCP8.5. The increase of global mean surface temperature by the end of the 21st century (2081–2100) relative to 1986–2005 is likely to be 2.6°C to 4.8°C under RCP8.5.

Relative to 1850–1900, global surface temperature change for the end of the 21st century (2081–2100) is projected to likely exceed 1.5°C for RCP4.5, RCP6.0 and RCP8.5 (high confidence). Warming is likely to exceed 2°C for RCP6.0 and RCP8.5 (high confidence), more likely than not to exceed 2°C for RCP4.5 (medium confidence), but unlikely to exceed 2°C for RCP2.6 (medium confidence) [13].

Research and Development (R&D) A general term for activities in connection with innovation; in industry; for example, this could be considered work directed towards the innovation, introduction, and improvement of products and processes.
resilience The capacity of social, economic and environmental systems to cope with a hazardous event or trend or disturbance, responding or reorganizing in ways that maintain their essential function, identity and structure, while also maintaining the capacity for adaptation, learning and transformation.
Scenario The Fifth Assessment Report (AR5) of the Intergovernmental Panel on Climate Change (IPCC) presents the results of an extensive climate modelling effort to make predictions of changes in the global climate based on a range of development/emissions scenarios. Regulation on climate change-related issues may present opportunities for your organization if it is better suited than its competitors to meet those regulations, or more able to help others to do so. Possible scenarios would include a company whose products already meet anticipated standards designed to curb emissions, those whose products will enable its customers to meet mandatory requirements or those companies that provide services assisting others in meeting regulatory requirements.
Scenario analysis A process of analyzing possible future events by considering alternative possible outcomes.
Science-Based Target To meet the challenges that climate change presents, the world’s leading climate scientists and governments agree that it is essential to limit the increase in the global average temperature at below 2°C. Companies making this commitment will be working toward this goal by agreeing to set an emissions reduction target that is aligned with climate science and meets the requirements of the Science-Based Targets Initiative.
Scope 1 emissions All direct GHG emissions (GHG Protocol Corporate Standard).
Scope 2 emissions Indirect GHG emissions from consumption of purchased electricity, heat or steam (GHG Protocol Corporate Standard).
Scope 3 emissions Other indirect emissions, such as the extraction and production of purchased materials and fuels, transport-related activities in vehicles not owned or controlled by the reporting entity, electricity-related activities (e.g. T&D losses) not covered in Scope 2, outsourced activities, waste disposal, etc. (GHG Protocol Corporate Standard).
Sector A classification of companies with similar business activities, e.g. automotive manufacturers, power producers, retailers, etc.
Sectoral Decarbonization Approach (SDA) To help businesses set targets compatible with 2-degree climate change scenarios, the Sectoral Decarbonization Approach (SDA) was developed. The SDA takes a sector-level approach and employs scientific insight to determine the least-cost pathways of mitigation, and converges all companies in a sector towards a shared emissions target in 2050.
Short-term Occurring in or relating to a relatively short period of time in the future.
Strategy A plan of action designed to achieve a long-term or overall aim. In business, this is the means by which a company sets out to achieve its desired objectives; long-term business planning.
Stress test A test designed to assess how well a system functions when subjected to greater than normal amounts of stress or pressure (e.g. a financial stress test to see if an oil & gas company can withstand a low oil price).
Supplier A person or entity that is the source for goods or services (e.g. a company that provides engine components to an automotive manufacturing company).
Target

A quantifiable goal (e.g. to reduce GHG emissions).

The following are examples of absolute targets:

metric tonnes CO2e or % reduction from base year

metric tonnes CO2e or % reduction in product use phase relative to base year

metric tonnes CO2e or % reduction in supply chain relative to base year

The following are examples of intensity targets:

metric tonnes CO2e or % reduction per passenger. Kilometre (also per km; per nautical mile) relative to base year

metric tonnes CO2e or % reduction per square foot relative to base

metric tonnes CO2e or % reduction per MWh

technical ressources The technologies, techniques and new solutions that contribute to improving its adaptive capacity. (ADEME, 2019) [23].
Technology The application of scientific knowledge for practical purposes, especially in industry (e.g. low-carbon power generation technologies such as wind and solar power, in the electric power generation sector).
threshold

Identifying the stages beyond which the operation of a system is significantly or irreversibly compromised, and understanding how climate change interacts with these functional thresholds, threshold analysis enables to identify different levels of risk.

The identification of these different risks thresholds in space and time then allows to prioritize and sequence incremental adaptation solutions [28].

TR Abbreviation of the ‘Transport’ sector
Trade association Trade associations (sometimes also referred to as industry associations) are an association of people or companies in a particular business or trade, organized to promote their common interests. Their relevance in this context is that they present an “industry voice” to governments to influence their policy development. The majority of organizations are members of multiple trade associations, many of which take a position on climate change and actively engage with policymakers on the development of policy and legislation on behalf of their members. It is acknowledged that in many cases companies are passive members of trade associations and therefore do not actively take part in their work on climate change (CDP climate change guidance).
transformation A change in the fundamental attributes of natural and human systems [23].
Transition The process or a period of changing from one state or condition to another (e.g. from an economic system and society largely dependent on fossil fuel-based energy, to one that depends only on low-carbon energy).
Transport To take or carry (people or goods) from one place to another by means of a vehicle, aircraft, or ship.
Trend A general direction in which something (e.g. GHG emissions) is developing or changing.
Verifiable / Verifiability To prove the truth of, as by evidence or testimony; confirm; substantiate. Under the ACT project, the data required for the assessment shall be verified or verifiable.
vulnerability / sensitivity The propensity or predisposition to be adversely affected. Vulnerability encompasses a variety of concepts and elements, including sensitivity or susceptibility to harm and lack of capacity to cope and adapt [24].
vulnerability metrics Metrics designed to assess the propensity of different parts of a company’s value chain to suffer negative impacts when exposed to and then impacted by physical climate hazards. These metrics should assess specific characteristics of a company’s value chain (e.g., water intensity) that may make that part of the value chain more or less likely to suffer negative impacts from physical climate hazards [24].
Weighting The allowance or adjustment made in order to take account of special circumstances or compensate for a distorting factor.

 

12. Annex

 

12.1. Annex 1 - Clarification on boundaries

Based on the first criterion, the economic activities that have significant climate impact, which means a sufficiently high share of GHG emissions along the value chain, must be identified. To identify these activities, we used various sources:

  • A study from the Environmental Paper Network (providing average of various Life Cycle Analysis in the sector – all steps except end-of-life stages – with an international scope).
  • A study from ADEME and FEDEREC extrapolated for the world using the world grid intensity provided by IEA  (for waste collection and waste sorting – initial French scope extrapolated to get an international carbon intensity).
  • A report from CEPI for the allocation of waste paper between waste sorting and waste disposal/incineration (international scope).
  • The EPA database with figures from the American Forest and Paper Association for the allocation between land disposal and incineration when waste paper is not sorted (US scope as no international figure has been found – which is also used by EPN  for its LCA tool).
  • The ADEME carbon base for the emission factors of waste paper incineration and disposal (French scope as no international figure has been found).

This approach ensures that the climate impacts are estimated at a global level when possible.

Regarding the carbon intensity of the forest tending and harvesting step, it is important to highlight that the figure includes both GHG emissions from the activity itself (e.g., fossil fuel combustion by the machineries) and the land management carbon impact. For this second point, EPN relies on different life-cycle analyses where the reference scenario used is the “foregone sequestration” and not the “net-zero” reference scenario. The “foregone sequestration” considers the loss of carbon uptake if trees would have continue growing and would not have been harvested.

 

Figure 11 - SHARE OF GHG EMISSIONS AND LAND MANAGEMENT CARBON IMPACTS ALONG THE PULP AND PAPER VALUE CHAIN

 

The 8 main contributors to the carbon footprint of the final paper and board product are the following activities:

  • Forest tending and harvesting (including land management carbon impact )
  • Woodchip production (wood sorting, debarking and chipping)
  • Non-fibrous material production (chemicals, additives, clays, starches, fuels, etc.) to be used for pulp production, paper and board making, and paper and board converting
  • Pulp production
  • Paper and board manufacturing
  • Paper and board converting
  • Waste disposal / incineration
  • Transportation

As the activities of “waste collection” and “waste sorting” account for a very low share of GHG emissions along the value chain, the GHG emissions sources linked to the waste collection and waste sorting economic activities are not included in the boundaries. In addition, companies within the scope of the sector have little control over them.

The eight remaining economic activities have significant climate impact and thus meet the first criterion. Apart from “waste disposal / incineration”, we consider that players within the scope have a level of control over the seven remaining economic activities. Therefore, the related GHG emission sources can be included in the boundaries.

Figure 12 shows the GHG emission sources that are included in the boundaries of the ACT Pulp & Paper methodology. The table 3 below figure 6 provides more details on the rationale for the inclusion/exclusion of the GHG emission sources in the boundaries and how they will be assessed (quantitatively or qualitatively)

 

Figure 12 - Boundaries of ACT Pulp and Paper methodology

We distinguish three broad categories of emissions:

  • Upstream emissions (forest tending and harvesting, woodchip production, and non-fibrous material production) – around 46 % of GHG emissions and land management carbon impacts along the value chain of virgin fibers, around 2 % of GHG emissions along the value chain of recycled fibers:

The GHG emissions due to the upstream activities result from the land-use change and modification, the use of fertilizers, the combustion of fossil fuels and the consumption of electricity produced externally to operate the machines in the forest, transport the harvested wood, operate the sawmills to produce chips or extract and produce the other non-fibrous materials.

  • Manufacturing - around 44 % of GHG emissions and land management carbon impacts along the value chain of virgin fibers, around 83 % of GHG emissions along the value chain of recycled fibers:

This concerns the stages of pulp production, paper and board manufacturing, and paper and board converting. Here the GHG emissions are due to the energy consumption during the manufacturing processes. They are reported through scope 1 and 2 in the GHG Protocol standard. Biogenic emissions (only CO2 emissions) due to biomass combustion won’t be accounted for in the quantitative indicators that are based on the low-carbon scenario using data from IEA Energy Technology Perspective 2017 as IEA considers biomass combustion as CO2 neutral. These indicators are found in the modules Targets (1), Material Investment (2) and Sold production performance (4). Having said that the sustainable sourcing of biomass used to produce energy on-site will be assessed through another indicator (see the indicator PP 4.5.). Also, the production of biofuels or electricity sold to other companies shall be excluded from the scope 1 and 2 emissions reported for the ACT Pulp and Paper methodology as only scope 1 and 2 emissions related to pulp and paper processes are required.

  • Transport - around 3 % of GHG emissions and land management carbon impacts, along the value chain of virgin fibers, around 2 % of GHG emissions along the value chain of recycled fibers:
    • Transport of materials includes GHG emissions due to upstream and downstream transportation of materials (woodchips, other non-fibrous material, pulp, paper, etc.) along the value chain
    • Transport of fuels includes the transportation of solid and liquid fuels (biomass, coal, oil, LPG) to the mill. The low mass energy density of biomass and coal can induce significant GHG emissions for the transportation of those energy sources.

Assessed companies will be evaluated on the inbound transportation (all the inputs required for their processes – both materials and fuels) and the outbound transportation (sold materials/products) through a specific qualitative indicator in the module 4. Sold product performance (see the indicator PP 4.7.)

 

Clarification on how biogenic carbon storage in the final product, avoided emissions and carbon dioxide removals are addressed in the ACT methodology framework

Avoided emissions and carbon dioxide removals, as well as biogenic carbon storage in the final product, cannot be subtracted from the company’s reported scope 1 and 2 GHG emissions that will be used for the indicators using the IEA low-carbon scenario. This is in line with recommendations from multiple international organizations:

  • The World Resources Institute argues that “comparative impacts should not be used to adjust scope 1, 2, and 3 emissions”,
  • The GHG Protocol, which states that “information on sequestered carbon in the company’s inventory boundary should be kept separate
  • The Science-Based Targets Initiative which does not allow offsetting as a mean toward setting a science-based target.
  • The IEA, that does not include carbon dioxide removals in its low-carbon scenario for the pulp and paper sector.

Nevertheless, as carbon removals and biogenic carbon storage are key regarding the climate impact of the sector, both will be addressed in module 4 - Sold product performance. Carbon removals will be addressed indirectly via the indicator PP 4.3. on the sustainable forest management dimension, while biogenic carbon storage will be assessed specifically through the indicator PP 4.4.

 

12.2. Annex 2 - TWG Members

Organisation Name
Confederation of European Paper Industries (CEPI) Malgosia Rybak
Stora Enso Oyj Johan Holm
UPM-Kymmene Corporation Tuomas Niemi
Suzano Papel & Celulose Mauro Paradella
WELYA SAS Olivier Pons Y Moll
Paprec Sébastien RICARD
Ibema Andrea Pegorini
Ibema Nicole Gonçalves
IEA Hana Mandova
CANDRIAM Alix Chosson
FEFCO Krassimira Kazashka
Imperial College Gbemi Oluleye
Groupe Hamelin Virgine Ori
Uniic Matthieu Prevost
Carton Ondulé de France Kareen Desbouis
Citeo Clarisse Guenel
Ence Energía y Celulosa SA Andrés Rodríguez

 

12.3. Annex 3 – List of ‘mature’ and ‘non-mature’ technologies

List of technologies that can be considered as CAPEX investment for the indicator 2.3
  • Lightning
  • Data automation and control
  • Improved mechanical dewatering
  • Water and heat saving through inline water cleaning
  • Drives and valves
  • Adjust pressure levels
  • Heat recovery by heat exchangers
  • Electrification
  • Direct renewable heat sources
  • Raw material replacement
  • Drying technologies
  • Enzymatic pre-treatment
  • Black liquor gasification
List of technologies that can be considered as R&D for the indicator 3.1
  • New drying technologies (steam/air impingement drying, condensing belt drying and impulse drying…)
  • Light-weight paper- making
  • Mild repulping technologies (eg deep  eutectic solvent pulping)
  • More effective fibre refining technologies
  • Innovative mechanical dewatering technologies
  • Advanced process control, machine learning and digital twins
  • Heat storage during breaks
  • Electric drying assisting technologies
  • Hydrogen to increase pulp mills product portfolio
  • New systems eliminating or minimizing the use of vacuum
  • Integral drying and heat recovery processes
  • Paper making without water (e. flash condensing with steam)
  • Water removal without evaporation
  • Biorefineries
  • Carbon Capture, Utilization, and Storage (CCUS) technologies

Both lists are not complete and will be finalized after the roadtest. The identification of those technologies are based mainly on the following technologies:

  • ICF Consulting, Industrial innovation: Pathways to deep decarbonization of industry, 2017
  • CEPI, Energy solutions forums, 2021