believe that the key to combatting global warming involves the use of renewable
materials, resource and energy efficient production processes, and sustainable
forest management practices. We are working to reduce fossil carbon dioxide
emissions within our operations by improving energy efficiency, and by
increasing the share of biomass fuels in our internal energy generation.
Opportunities and challenges
Our use of renewable materials enables us to contribute to the development of a low-carbon economy. Trees in sustainably managed forests absorb carbon dioxide (CO2) from the atmosphere and together with wood-based products act as carbon sinks. Our products help our customers and society at large to reduce CO2 emissions by providing low-carbon alternatives to solutions based on fossil fuels and other non-renewable materials.
Stora Enso welcomes the Paris climate agreement as an important milestone in sustainable global development. In December 2017, as the first forest products company, the Science Based Targets initiative approved our ambitious targets to address significant emissions along our value chain. The European Union's Emissions Trading System (ETS) brings additional opportunities and challenges to the forest industry in combatting global warming.
How we work
The most effective ways to reduce our direct fossil CO2 emissions are to further improve our energy efficiency, and to continue to increase our use of biomass fuels. Significant investments in previous years, particularly in multi-fuel boilers, have significantly reduced our fossil CO2 intensity.
For over a decade, we have actively reduced the energy intensity of our operations – and our dependency on fossil fuels. From 2017, we have measured our progress based on fossil CO2 emissions (kg) in relation to energy consumption (MWh). We drive down fossil fuel use so that we get as close to zero as possible within the decade using technically and commercially feasible means.
Stora Enso evaluates risk and opportunities related to global warming through the Enterprise Risk Management (ERM) process, which forms an integral part of our management approach. We also routinely calculate the financial impacts of potential cost increases in relation to emission allowances and energy prices.
Since 2007, our target has been to reduce our fossil CO2 emissions per saleable tonne of pulp, paper, and board by 35% from 2006 levels by the end of 2025, covering both direct and indirect emissions. In Q4/2017, we reached a 37% reduction compared with 2006. The group's CO2 intensity will in the future be adversely affected by the use of coal for energy production at our Beihai Mill in China. Although coal is currently the only feasible energy source for an industrial project in Beihai, we are working to define a long-term strategy to migrate away from coal.
Carbon neutral CO2 emissions are fossil-free emissions generated during the combustion of biomass-based fuels coming from sustainably managed forests*. Stora Enso's operations primarily utilise renewable biomass-based fuels, so the share of carbon neutral CO2 emissions in our total CO2 emissions is high (80% in 2017).
In 2017, direct emissions from our operations accounted for 22% of our carbon footprint in 2017, while 11% resulted from purchased electricity and heat and 67% were generated elsewhere along the value chain.
In December 2017, Stora Enso became the first forest products company to set ambitious science-based targets
for reducing greenhouse gas (GHG) emissions throughout its value chain. With the targets, Stora Enso commits to reducing GHG emissions from operations by 31% per tonne of pulp, paper, and board produced by 2030, compared to a 2010 baseline. To reduce emissions in our value chain, we also commit to ensuring 70% of our non-fibre suppliers and downstream transportation suppliers in terms of spend set their own GHG reduction targets by 2025, and adopt science-based GHG reduction targets by 2030. In addition, by training 100% of our customer-facing staff on the advantages of setting science-based targets by 2020.
In Q1/2018, we achieved a GHG reduction of -9%. During the quarter, our GHG emissions were at a higher level compared to Q1/2017, mainly due to increased fossil
fuel consumption at several Finnish mills. This is explained partly by colder weather year-on-year.
* Recommendations on Biomass Carbon Neutrality, WBCSD 2015.