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The forest products value chain:


The Sustainable Forest Products Industry Project of the ... Burning Fossil. Fuels. and. Cement. Manufacture. 1.7 Gt/yr. Land Use Change. 1.9 Gt/yr. Land Uptake ... – PowerPoint PPT presentation

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Title: The forest products value chain:

The forest products value chain Energy and
Climate Change
A Discussion Sponsored by The Sustainable
Forest Products Industry Project of the World
Business Council for Sustainable
Development (WBCSD) and The International
Council of Forest and Paper Associations (ICFPA)
Overview of The Forest Products Industry Value
Chain and the Global Carbon Cycle and The
Climate Change-Related Issues Faced by the
Forest-Based Industry Presented by Reid Miner,
What is the Forest-Based Industry Value Chain?
  • Value Chain Elements
  • Forestry
  • Manufacturing
  • Transport
  • Product Use
  • Recycling
  • Other End-of-Life Uses
  • Product Disposal
  • Value Chain Attributes
  • Carbon Cycle
  • Recycling
  • Biomass-based
  • Substitution effects
  • Economic Social benefits

Why a Value Chain Perspective?
  • Allows a holistic examination of impacts and
  • Provides insights that can be important to public
  • Is required to properly understand sustainability
  • The climate change issue is part of the larger
    challenge of sustainable development. As a
    result, climate policies can be more effective
    when consistently embedded within broader
    strategies designed to make national and regional
    and corporate development paths more
    sustainable. (IPCC 2001)

The Forest Products Industry Value Chain and
the Connections to the Climate Change Issue
  • First, an overview of the current situation
  • Then some of the issues faced by the forest-based

Sequestration of carbon in forests and forest
  • The forest-based industry is intimately connected
    to the global carbon cycle
  • Some background

(No Transcript)
Major Carbon Stocks IPCC 2001
730 Gt C
2,300 Gt C
38,000 Gt C
Major Carbon Stocks and Gross Annual Carbon
Flows IPCC 2001
730 Gt C
90 Gt/yr
120 Gt/yr
120 Gt/yr
90 Gt/yr
2,300 Gt C (1200 in Forests)
38,000 Gt C
Relatively Small Net Annual Fluxes are Causing
Increases in Atmospheric CO2 IPCC 2001
1.7 Gt/yr Land Use Change
5.4 Gt/yr
1.9 Gt/yr
1.9 Gt/yr Land Uptake
Burning Fossil Fuels and Cement Manufacture
Changes in Global Forest Carbon Stocks (IPCC
1996, 2000, 2001)
  • Forest carbon stocks are generally stable or
    increasing in middle and high latitudes.
  • Forest carbon stocks appear to be declining in
    the tropics, but estimates are uncertain.

Carbon Stored in Forest Products
  • Carbon in forest products
  • removed from atmosphere in the forest
  • remains sequestered during product use
  • Forest Product carbon pool growing
  • recent estimate 0.04 Gt C yr-1, (IPCC 2003)
  • Forest Product carbon pool will continue to grow
    for a long time
  • long times-in-use for many products
  • slow decomposition in landfills
  • increasing standards of living

Estimating Carbon Stored in Forest Products
  • National Inventories
  • IPCCs 2003 Good Practice Guidance for Land Use,
    Land-Use Change and Forestry - Appendix 3a.1
  • Corporate or Value Chain Inventories
  • ICFPA Tools being developed
  • Based on the 100-Year Method
  • Will be reviewed for use under WRI/WBCSD GHG

Manufacturing Emissions of GHGs
  • Global forest products industry direct emissions
  • 0.072 Gt C yr-1
  • Approximately 1.3 of global C emissions
  • Global indirect emissions more uncertain
  • Indirect emissions from purchased power are
    perhaps 50 to 75 of direct emissions
  • The forest-based industrys GHG profile benefits
  • Extensive use of biomass for energy
  • Extensive use of Combined Heat and Power (CHP)

Benefits from Biomass Fuels and CHP
  • The forest products industry derives more of its
    energy from biomass than any other industry
  • Approximately 50 of energy requirements in OECD
  • The pulp and paper industry is among the leaders
    in using CHP systems
  • Reduces fuel requirements, including fossil fuels
  • Often powered by biomass fuels
  • In many countries, CHP systems supply more than
    1/2 of electricity needed by pulp and paper mills

Estimating Manufacturing Emissions of GHGs
  • Pulp and paper mill calculation tools
  • ICFPA/NCASI calculation tools
  • Accepted for use under WRI/WBCSD GHG Protocol
  • Solid wood products manufacturing calculation
  • Developed for AFPA and FPAC by NCASI
  • Being reviewed by WRI/WBCSD for use under the GHG

So we see that the carbon profile of the
forest-based industry consists of
  • Carbon in the forest
  • Carbon in products
  • Biomass energy
  • Carbon recycled, beneficially used, disposed
  • Manufacturing emissions
  • Indirect emissions
  • Other emissions along the Value Chain

Issues for the Forest-Based Industry
Carbon Sequestration Issues
  • 1. The Productivity - Sequestration connection
  • Higher forest productivity Reduced footprint
  • Higher productivity Cost competitive
    carbon-sequestering products that can displace
    more GHG-intensive alternatives
  • 2. Dangers of emphasizing forest sequestration
  • Leakage of benefits
  • Misses importance of other value chain effects
  • Makes carbon-intensive substitutes more
  • Carbon storage in the forest probably saturates
    more quickly than storage in forest products

Carbon Sequestration Issues
  • 3. Managing for multiple objectives
  • Developing tools that allow the cost of carbon
    and other environmental attributes to be
    reflected in forest management decisions
  • 4. Integrating carbon into corporate
  • Connection to sustainable forestry
  • Impacts on industrys ability to provide economic
    and social benefits to rural communities and
    other stakeholders

Biomass Fuel Issues
  • 1. Competition for fiber
  • Market-distorting public policies
  • Many non-carbon benefits accrue when fiber is
    used as a feedstock rather than fuel
  • Unintended substitution effects
  • 2. Need policies that encourage additional supply
    of virgin and recovered fiber

Manufacturing GHG Issues
  • 1. Opportunities for improved efficiencies
  • Incentives
  • 2. Regulatory and market barriers to increased
    use of CHP and export of electricity
  • 3. The costs to achieve GHG reductions
  • 4. Changing fuel costs
  • 5. Different types of mills have different
  • 6. Must consider the turnover of capital

Value Chain GHG Issues
  • 1. Net effects of forest management on emissions
    from the forest
  • 2. Indirect emissions can be significant
  • Purchased power, transportation, energy-intensive
    raw materials
  • Opportunities for partnering or process changes
    to achieve reductions
  • 3. End-of-life emissions from forest products
  • The complicated effects of recycling
  • Less organic waste is going to landfills
  • Biomass fuel from landfill methane and
    non-recyclable paper

Substitution Effects Issues
  • 1. Over the long term, substitution effects are
    very important
  • Often greater than sequestration
  • Most substitution effects are permanent
  • Building products as an example
  • 2. Some substitution effects are understood
  • 3. In many cases, however, a better understanding
    is needed

Many issues to discuss
  • Sequestration of carbon in forests and products
  • Manufacturing emissions of greenhouse gases
  • Biomass as a substitute for fossil fuels
  • Combined heat and power
  • Value chain emissions of greenhouse gases
  • Choices between products based on GHG-intensity
    and climate concerns (substitution effects)

Closing Observations
  • The globes population is growing while
    standards-of-living are increasing
  • An examination of the value chain suggests that
    the forest-based industry can help meet this
    global sustainability challenge.
  • The industry has the opportunity to provide
    products that
  • provide carbon and other environmental benefits
  • provide a range of economic and social benefits
  • support rural economies
  • But a range of issues must be addressed