UPM BIOFUELS ADVANCED BIOFUELS PAVE THE WAY FOR SUCCESSFUL BIOECONOMY. Sari Mannonen, UPM Biofuels World Bio Markets 2015

Transcription

1 UPM BIOFUELS ADVANCED BIOFUELS PAVE THE WAY FOR SUCCESSFUL BIOECONOMY Sari Mannonen, UPM Biofuels World Bio Markets 2015

2 UPM today UPM Paper ENA Magazine papers in Europe and the USA Newsprint and fine papers in Europe UPM Energy Hydro-, nuclear- and condensing power (incl. shares in energy companies) Electricity production and trading UPM Plywood Plywood products UPM Biocomposites UPM Biochemicals Biofuels is the spearhead project in UPM s change UPM Biorefining Pulp Plantations Biofuels Sawmills UPM Raflatac Label materials for product and information labeling KEY FIGURES UPM Paper Asia Fine papers in China Label papers globally Turnover 2013: 10 billion Personnel: 21,000 Shareowners: > 90, UPM

3 Wood biomass is in the forefront of new bioproducts development Europe - Most forest-rich region 1.02 billion ha = 25% of global resources Forest area expanding (annually ha) Only ~ 40% of increment utilized Wood is preferred biomass; technologies to convert lignocellulosic feedstock into value added products developing fast Advantages of wood: Limited price volatility Available year-round Easy to transport and store No overlap with food-chain 3 UPM

4 Biofore growth opportunities added value of wood and biomass UPM Grada UPM BioVerno Biofibrils UPM ProFi UPM Formi Biofibrils Biofuels for transportation Bioenergy heat and electricity Labels and composites Pulp, paper, plywood and sawn timber Sourcing and logistics of wood and biomass Biochemicals 4 UPM

5 Wood raw material is the basis of many different businesses at UPM 5 UPM

6 Responsibility is a source of competitive advantage 4 3 Value creation with stakeholders Dialogue, feedback and engagement 2 New business opportunities with ecodesign Biofuels, Biochemicals, Biocomposites 1 Creating competitive advantage and long-term value High performing people, resource efficiency, ecolabels and certification Anticipating and managing risks Code of Conduct, environmental performance, responsible sourcing and forestry 6 UPM

7 UPM Biofuels and latest sustainability recognitions UPM renewed its position as the industry leader in Dow Jones Sustainability Indexes for Award for Breakthrough Innovation in Technology in 2013 Winner in Travelling category 2014 awarded by European Commission Finalist in Sustainable Innovation category in the Leading Technology Award UPM

8 Leaders of Sustainable Biofuels Industry platform driving development of advanced biofuels in Europe Leader Companies Now is the time to bring advanced second-generation biofuels to the market. The industry is committed to delivering on its promise but we need stable long-term investment conditions which encourage investment while, at the same time, promoting true advanced biofuels. 8 UPM

9 UPM and Waste-based biofuels sector Wasted: Europe s Untapped Resource European Climate Foundation coordinated Biofuels from wastes & residues offer real, over 60% carbon savings Calls for a policy framework allowing investment Phase 2: National cases If all sustainable waste from farms, forests, households and industry were used for transport fuels by 2030 Displaces 37 million tonnes of oil annually Equal to 16% of road transport fuel demand Up to 300,000 direct jobs across Europe Up to 15 billion EUR additional revenues 9 UPM

10 UPM and WWF Finland promote sustainability of wood-based biofuels Long history of working together in sustainability May 2014 UPM and WWF Finland signed a contract to widen cooperation into biofuels October 2014 New opportunities of bioeconomy seminar to 100 Finnish key stakeholders Wood-based biofuels are among most promising alternative fuels November 2014 Dialogue paper signed to promote sustainability of wood-based biofuels with list of joint measures 10 UPM

11 UPM Biofuels Strategy Renewable fuels Wood-based raw materials Sustainable operations Drop-in fuels fully compatible with all all diesel engines and fuel distribution systems Renewable wood-based raw materials Not competing with food production Sustainable supply chain Low emission products UPM will become a major player in advanced biofuels 11 UPM

12 UPM s journey in advanced biofuels UPM published its plans to become a significant producer of advanced biofuels Development of hydrotreatment process started in UPM R&D UPM Lappeenranta biorefinery in commercial production in January Development of BTL technology ongoing at GTI pilot plant in Chicago, USA 2012 First investment decision of 175 M for UPM Lappeenranta biorefinery. Produces renewable diesel from tall oil Sales of UPM BioVerno diesel starts. Business is expanding in stages. 12 UPM

13 Capturing synergies by full integration into UPM Kaukas mill site in Lappeenranta, Finland BIOREFINERY RESEARCH CENTRE BIOMASS POWER PLANT SAW MILL 2 PULP MILL PAPER MILL UPM

14 UPM Lappeenranta Biorefinery, Finland Key facts: Product: Renewable diesel UPM investment: 175 M Capacity: 100,000 tonnes/a UPM Patents & Applications: 200 Commissioning: January 2015 Employment: 200 persons Contributes approximately 25% of Finland s biofuel target (20%) 14 UPM

15 Raw material: Crude Tall Oil (CTO) a residue of pulp making process CELLULOSE 40% 30% HEMICELLULOSE LIGNIN 25% 5% EXTRACTIVES PRIMARY PRODUCT Pulp for paper making 50% PULPING PROCESS Pulping process separates pulp fibres from wood via chemical processing 2% GREEN ENERGY 48% RECIDUE STREAM Crude tall oil Crude tall oil must be removed from the chemical cycle to secure pulping process functionality 15 UPM

16 Raw material: Crude Tall Oil (CTO) Contains natural extractives of wood Yield kg CTO/t pulp Global production > t/a - CTO supply potential above demand globally and increasing - Significant share burned for energy - Production potential t/a UPM tapping into underutilized lower grade CTO streams UPM biorefinery minor addition to total demand, no effect on demand-supply balance Residue of pulping process Outside food value chain No increase in harvesting or land use UPM Source: Ecofys:, Low ILUC assessment CTO, Pöyry

17 UPM renewable diesel process 17 UPM

18 UPM BioVerno Renewable drop-in diesel RENEWABLE RAW MATERIAL 100 % CO 2 EMISSIONS (VS. FOSSIL FUEL) 80 % COMPATIBLE WITH DIESEL VEHICLES 100 % 18 UPM

19 UPM BioVerno - Suitable for all diesel engines 4 Volkswagen cars, km/car Summer and winter conditions, various distances Fleet testing with 20% UPM BioVerno renewable diesel with 4 Volkswagen cars Independent testing by experienced test drivers of Technical Research Centre of Finland (VTT) Investigating fuel functionality in engine, emissions and fuel consumption Phase 2: heavy duty vehicles test (busses) Functions as fossil diesel 19 UPM

20 UPM Biofuels growth strategy Growth of Business RESEARCH & DEVELOPMENT R&D activities and co-operation with strategic partners Expanding Business THERMAL CONVERSION Solid wood raw material Entering Business HYDROTREATMENT Tall oil raw material UPM Lappeenranta Biorefinery 20 UPM

21 UPM's competitive edge in biofuels Competitive Raw-material Efficient Process High quality product Part of the UPM ecosystem Optimise wood fractions to right products Steady supply Outside food value chain No indirect land-use change Meets sustainability criteria Technology based on UPM and partner s innovations & know-how Efficient use of raw material Integrate synergies 2nd generation hydrocarbons Compatible with current fleet and standards 80% reduction in greenhouse gas emissions High energy content No blend wall limitations 21 UPM

22 UPM is in an excellent competitive position to integrate processes for new bioproducts Three areas of competence bring UPM in the position to become the frontrunner in new biomass based innovations Biomass handling Debarking Saw mills Mechanical pulping Bioenergy & Infrastructure Biomass boilers CHP 4. Lorem ipsum Water dolor treatment 12pt Lorem ipsum dolor sit amet, Chemical processes Kraft pulping Renewable diesel production 1 Access, management 2consectetur adipiscing elit. Fusce eu Processes of biomass 3 and sourcing of biomass tincidunt ipsum conversion Run sustainably large industrial processes 22 UPM

23 Driving CLEANER traffic UPM Biofuels

24