Roll with the changes - fiber industry as a trendsetter in decarbonization
When it comes to business, innovation truly has a momentum these days. But paradoxically, one of the most profound transformations is happening within an industry, which has already been declared dead by digitalization: the pulp and paper industry. When you listen to Stanley Dorasamy, you could easily imagine him as the charismatic founder of a hyped tech company. But as an expert for industrial turbines for Siemens Energy, he explains with passion and clarity, why the latest innovations for decarbonization come from an industry, which is often misjudged as old-fashioned.
By Matthias Ziegenhain
Download the white paper on "Fiber industries on their way to decarbonization"
The fiber industry has already taken a leading role in the closed-cycle economy. But how can you further reduce the energy consumption? The paper describes how the energy systems can be optimized with regard to thermal and electrical power.
Which were the most profound changes that happened in the last decade?
Stanley Dorasamy: The most profound changes - I will call it the decarbonization journey - is the reduction of the amount of water, which is used to produce paper. The energy and greenhouse gas reductions are closely linked to this. In the early 90s, we called these ‘environmental emissions.’ Today we call it the decarbonization journey since we have learned how environmental emissions can bring down the 1.5 degree rise that we are all striving for as a member of the awareness committee of sustainable thinking. We also found that if you look at the control system in a modern pulp and paper mill, many authors have said, that you can equate this to the automation built in a Boeing 767 or an Airbus. That’s how evolved the fiber industry has become by using cutting-edge technologies.
Is such a rapid evolvement also possible for the pulp and paper industry?
Absolutely. Digitalization will dramatically change the way the fiber industry is working. We always spoke of a paperless office where digitalization will make it zero - but this has never happened. None of us read a newspaper, we read it from an iPhone, but think about it carefully. The iPhone came in a packaged box that's corrugated packaging. And this is the pulp and paper industry. So as much as printing and writing rates will be affected by digitalization, other areas such as consumer packaging, industrial packaging, engineered fiber materials, will form the solutions of the future.
“Today, the biggest challenges that they face are regarding the sustainable energy production. Mills are on the way to address these challenges, embracing technological changes.”Stanley Dorasamy, Senior Global Sales Manager and Fiber Expert at Siemens Energy.
Which challenges are mills facing within the fiber industry today?
Today, the biggest challenges that they face are regarding the sustainable energy production. How could we further reduce our energy consumption? But the mills are on the way to address these challenges, embracing technological changes. Seeing how industry 4.0 or the internet of things would help them in their core business models.
What does it take for a mill to stay competitive today?
The driving factor is the reduction of the operating costs. In Europe, energy forms 12-13% of the operating costs. In the developing world, India and other places, energy can form at least 20-25%. And therefore, is a big cost factor, which does have an impact of the gross margin of the product. So, in the developing world the drive is to reduce the energy and the water consumption, while improving the automation and control, by using digitalization and the internet of things.
How can circular approaches bring mills beyond efficiency?
The fiber industry belongs to a cluster of industries. I wrote my MBA thesis on this in the Netherlands, it’s called the forestry cluster industry. The fiber industry supports the chemical industry, the iron industry and the automotive industry. This is why a failure in the global fiber industry can lead to a complete global failure of the supporting industries. As an example, the forestry cluster in the European Union is a very highly responsible industry, 92% of the raw materials are sourced locally in Europe and are certified as sustainable. 91% of the water we use is returned in good condition to the environment.
We are the world champions in recycling at a rate of 72% - standing at the forefront of decarbonization and industrial transformation.
Water-steam-cycles are a big topic for the solutions provided by Siemens Energy.
Water steam cycles have always been a big topic for the industry. Obviously pulp mills are mostly running on steam turbine technology because the energy source is coming for free from the black liquor. Tissue machines are running with our gas turbines.
Our gas turbines are also capable of burning hydrogen - meaning if there is a nearby refinery, we can also extract hydrogen from the oil refinery. Or if there's a nearby wind park, we can use an electrolysis cell to generate hydrogen at zero CO2 emissions. We could combust the hydrogen in the gas turbine to generate power for the tissue machine and use the heat of the gas turbine for the tissue drying process. In both ways we are able to serve customers’ needs and advise them what is best: a water steam cycle or a gas turbine technology or our organic ranking cycle, which uses waste heat to generate the power. And this brings us to the areas of choosing the right technology to the right job, ensuring their CAPEX is spent on the best alternatives.
With all this change going on in the industry, you constantly need to reinvent yourself.
At the time when I was studying in Helsinki, people spoke of the year 2000 as the year of the paperless office. This has never happened. Because the forestry is a clustered industry, supporting an array of allied industries - chemicals, rubber, iron and steel.
The forest industry will always be leading the area of technological development, because it supports other industries. In Europe we will move to biotechnology, bio-refinery, engineered fibers, replacement of steel components, fiber impregnated parts - we already see this in the aircraft industry. The non-OECD-countries would move more in the region of printing, packaging papers, corrugated, hygiene papers. So, this continuous cyclical change will always be in this industry.
The author Matthias Ziegenhain is specialized on digital transformation and brand strategy.
Combined picture credits: Siemens Energy, Getty Images