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INTERNET EDITION

PULP & PAPER PRODUCTION


CHAPTER V

ZEROING OUT DIOXIN IN THE GREAT LAKES: WITHIN OUR REACH

June 1996

CBNS
CENTER FOR THE BIOLOGY OF NATURAL SYSTEMS QUEENS COLLEGE, CUNY FLUSHING, NEW YORK
http://www.qc.edu/CBNS

PULP & PAPER PRODUCTION


CHAPTER V
ZEROING OUT DIOXIN IN THE GREAT LAKES: WITHIN OUR REACH
Barry Commoner Mark Cohen Paul Woods Bartlett Alan Dickar Holger Eisl Catherine Hill Joyce Rosenthal

June 1996

This report is the result of the second years work on a two-year project, Economically Constructive Conversion of the Sources Contributing to the Chemical Pollution of the Great Lakes, supported by The Joyce Foundation.
Printed on 100% post-consumer recycled paper processed without chlorine.

TABLE OF CONTENTS

I. II.

Introduction Strategic Approach References Medical Waste Incineration A. Introduction B. Technical Background C. Economic Analysis of the Alternative Means of Medical Waste Disposal D. Conclusions References

III.

IV.

Municipal Solid Waste (MSW) Incinerators A. Introduction B. The Regulatory Situation C. Implementation of An Intensive Recycling System In the Great Lakes Region D. Direct Economic Impact of the Intensive Recycling Programs E. Other Economic Impacts of Implementing the Intensive Recycling Programs F. Conclusions and Recommendations References Appendix

V.

Paper and Pulp A. Introduction B. Technical Background C. The Environmental Effects of Chlorine Dioxide-ECF and TCF Technology D. Economic Analysis E. Product Marketing and Demand References Appendix

VI.

Iron Sintering A. Introduction B. Technical Background C. Economic Analysis D. Conclusions and Recommendations References

VII.

Cement Kilns Burning Hazardous Waste A. Introduction B. The Regulatory Situation C. Technical Background D. The Economic Consequences of Preventing Dioxin Emissions E. Conclusions and Recommendations References

VIII.

Conclusions References

V-1 V. PULP & PAPER PRODUCTION A. Introduction: The paper and pulp mills that dispose of their effluent into the Great Lakes and their tributary rivers contribute a relatively small part of the total amount of dioxin 1 that enters the lakes. Nevertheless, even this effect is important, for however dilute dioxin may be, it becomes concentrated in its passage through the food chain. Moreover, in pulp mill effluent dioxin is accompanied by a large group of other chlorinated organic compounds, lumped together under the term AOX. Although in recent years the industry has made a successful effort to reduce the levels of dioxin in pulp mill effluent and the pulp itself, the levels of AOX and other pollutants remain relatively high. Even the most modern low effluent mills have toxic effects on aquatic organisms. Because of the multiplicity of pollutants produced by paper and pulp production, and the high cost of removing them once they are produced, there is a growing recognition that pulp and paper mills must move toward a design in which effluents, instead of being released, are recycled in a closed loop. As it happens, the technical possibility of achieving such a Totally Effluent Free (TEF) pulp mill is facilitated by the design changes that produce a Totally Chlorine Free (TCF) system -- which realizes the goal of completely preventing the formation of dioxin to begin with. For these reasons, despite the considerable reduction in the pulp and paper industrys environmental impact on the Great Lakes, it remains important to consider what can be done to completely eliminate the production of dioxin and other chlorinated pollutants that are now generated by pulp and paper mills. The response of industry and the regulatory agencies to the problem of waterborne dioxin created by pulp mills contrasts sharply with their response to the airborne sources that we have analyzed. The remedial approach to the airborne sources has relied on tacked-on control devices. In contrast, in the last decade the pulp and paper industry, faced with the issue of dioxin pollution, has made changes in the production process itself, applying the strategy of pollution prevention rather than control. And, like the most familiar successes of pollution prevention -- the more than 95% reduction in airborne lead emissions largely achieved by removing lead from the production of gasoline -- the strategy has worked equally well to reduce the dioxin content of pulp mill effluents. To this extent, the recent effort of the industry to deal with the dioxin problem can be regarded as a salutary example to other industries -- many of which regard pollution prevention as moreof a slogan than a principle of action.

As is the general case throughout this report, and noted earlier, we use the term dioxin here as it has become commonly used to denote the entire class of toxic polychlorinated dioxins and furans. When discussing empirical measurements or chemical mechanisms however, we will occasionally specify particular dioxin and furan congeners.

V-2 B. Technical Background: 1. The basic process: Wood is chiefly composed of two major substances; both are organic, that is, their molecules are built around chains and rings of carbon atoms. Cellulose, which occurs in the walls of the plant cells, is the fibrous material that is used to make paper. Lignin is a large, complex molecule; it acts as a kind of glue that holds the cellulose fibers together and stiffens the cell walls, giving wood its mechanical strength. In order to convert wood into pulp suitable for making paper, the cellulose fibers must be freed from the lignin. In mechanical pulping this is done by tearing the wood fibers apart physically to create groundwood pulp, leaving most of the lignin intact in the pulp. The high lignin content of groundwood pulp leaves the paper products weak and prone to degradation (e.g. yellowing) over time. Mechanical pulp is used principally to manufacture newsprint and some magazines. In most pulp production -- for example, the kraft (German for strong) process -lignin is separated from the fibers chemically: wood chips are heated (cooked) in a solution of sodium hydroxide and sodium sulfide. 2 The lignin is broken down into smaller segments and dissolves into the solution. In the next step, brownstock washing, the breakdown products and chemicals are washed out of the pulp and sent to the recovery boiler. 3 Kraft unbleached pulp has a distinctive dark brown color, due to darkened residual lignin, 4 but is nevertheless exceptionally strong and suitable for packaging, tissue and toweling. For brighter and more durable products the pulp must be bleached: the color in the residual lignin is either neutralized (by destroying the chromophoric groups 5) or removed with the lignin. This process traditionally has been accomplished for kraft pulp by chlorine bleaching, usually followed by washing and extraction of the chemicals and breakdown products. This process is not much different than washing clothes: the stains imbedded in cloth fibers are either neutralized by bleach, or broken down and washed out. Thus, the basic steps in pulp production are: delignification; brownstock washing;
2

The kraft pulping process is the dominant chemical process in the United States as a whole and in the Great Lakes region. In another chemical process, the sulfite process, pulp is produced by cooking wood chips in an acidic or neutral solution of bisulfides. The processing chemicals are recovered for reuse in this process, but not completely: the air emission of sulfur compounds produce the distinctive aroma of the kraft pulp mill.
4 5 3

The traditional kraft cooking process removes 80% of the lignin. (Smook, 1992, pg 77).

Chromophoric groups are particular chemical structures which absorb specific wave lengths of light, giving the substance color. Bleaching agents either restructure or break up the chromophoric groups by oxidation or chlorination reactions, thereby eliminating the color in the pulp.

V-3 bleaching; and extraction. Additional bleaching and extraction stages are added to achieve the desired brightness. As the industry has developed, these basic steps have been refined and additional chemicals and sequences introduced. (See Figure V-A in Appendix.) 2. The pollution problem: Long before the dioxin problem arose, pulp mills were notorious sources of environmental pollution. Although their most obvious environmental effect was foul sulfur odors, the more serious impact was on local rivers and lakes. The spent chemicals and waste products were dumped into the waters. In the 1930's, the industry developed a radical pollution prevention innovation: the brownstock washing was recirculated to a recovery boiler where the pulping chemicals were recovered for reuse and the lignin was used to generate energy. The cost savings made kraft mills more competitive. In the 70's and 80's end-of-pipe treatment dominated pollution reduction efforts in North America. In the Nordic countries the application of the principle of pollution prevention has led to a complex and flexible array of production processes, among them ones that have a crucial impact on the dioxin problem. The most serious pollution problems have arisen from the use of chlorine in bleaching.6 Emitted into local bodies of water, these pollutants have rendered water unfit for drinking, made fish unsuitable for consumption and seriously harmed aquatic life. Chlorine, in the elemental form of chlorine gas, readily reacts with organic molecules. As a result, when chlorine enters the pulping process it reacts with lignin, its breakdown products, other organic plant components, and chemical contaminants to form numerous chlorinated organic chemicals, many of them toxic. These are referred to, collectively, as AOX. By 1993, more than 300 chlorinated organic compounds had been reported in pulp mill bleach plant effluents; but these were estimated to account for no more than 10% of the effluent components (Suntio et al., 1988; USEPA, August 1993, p. 2-10-11). As of 1994, 415 organic substances had been identified (Paper Task Force, 1995c, p. 34). The bulk of the chlorinated organics (75-90%) are high molecular weight compounds (HMWCs molecular weight > 1,000), which are difficult to characterize due to their large size and variable structures. The remaining chlorinated organics can be typified as: relatively water soluble (19%); potentially bioaccumulative, relatively fat soluble (0.09%); and bioaccumulative, highly fat soluble (0.1%). Identified chlorinated compounds include: chlorophenolics (phenols, guaiacols, catachols and vanillins);

Conventional kraft pulp mills chlorine-based bleaching operations are responsible for 100% of the AOX, 30% of the BOD, 50% of the COD, 40% of the color, and 30% of the volume of the total pollutants produced by the pulp mill as a whole (Johansson & Fletcher, 1994).

V-4

The Pulp and Paper Industrys Commonly Measured Waterborne Pollutants: Adsorbable Organic Halides (AOX): Organic halides are organic compounds containing one or more of the halide atoms (chlorine, bromine, iodine and fluorine) linked to their carbon atoms. Since chlorine is generally the only halide involved in pulp processes, AOX is simply a collective measure of all the chlorinated organic compounds in the pulp mill effluent. They are analyzed by mixing crude effluent with active carbon and measuring the amount of total material and chlorine that is adsorbed on the carbon. Thus, AOX is an aggregate measure and does not reveal the specific chlorinated organics compounds it includes or their toxicities. Specific chlorinated organic compounds are measured on a less regular basis due to expense (e.g. dioxins, furans, phenols). Chloroform: Chloroform is toxic and carcinogenic. The highest emissions of chloroforms from chlorine compound bleaching are associated with the use of hypochlorite. The Toxic Release Inventory, published annually by the U.S. EPA, reported that 75% of chloroform releases in the United States in 1989 came from pulp and paper processes. (U.S. EPA, 1991; Mgmt. Inst. For Envir. & Bus., 1994) Total Suspended Solids (TSS): Solids from pulp mills consist of dirt, grit, fiber, lignin and other solid wood constituents. TSS can become deposited in receiving waters, blanket and destroy the habitat of bottom-living organisms. Many toxic chemicals, including dioxins, adsorb to TSS, which become vehicles for their release to the aquatic environment. Biological Oxygen Demand (BOD): BOD measures the consumption of oxygen in water (usually over a five-day period), resulting from the metabolic activity of oxygen-consuming microorganisms. BOD therefore reflects the effluents content of organic compounds, many of which are metabolized and therefore give rise to oxygen consumption. Effluents with high BOD deprive receiving waters of the oxygen necessary to support aquatic life. Chemical Oxygen Demand (COD): COD measures the amount of all organic compounds that can be oxidized chemically, for example by reacting with oxygen. It therefore measures not only the compounds that are responsible for BOD, but also the biologically inert oxidizable organics. Thus, COD measurements include compounds that are not readily degradable by microbiological processes. These are often persistent, and may bioaccumulate, as in the case of many toxic chlorinated organics, such as dioxin. Color: The primary objective of regulating color in paper mill effluent may be aesthetic, but some of the colored compounds are also responsible for long-term biological oxygen demand (BOD) -- i.e., over 20 to 100 days or more (U.S. EPA 1993, p. 2-6). For example, lignin and lignin derivatives are colored, take a relatively long time to break down, and become then capable of being metabolized, therefore contributing to long-term BOD. Aquatic Life Toxicity: Serious effects on aquatic life, especially fish, are often seen as the first signal of pollution: habitats are destroyed, populations decrease. However, this is not always the case: many chlorinated organics toxicities may bioaccumulate (e.g., dioxins, PCBs, mercury) and travel up the food chain into human consumption, or find their way into drinking water without necessarily affecting fish or other forms of aquatic life. Acute and sublethal effects on specific marine organisms are measured to assess effluent toxicity, but are difficult to generalize to other species. Model ecosystem studies supplement these efforts, but take a longer time to complete.       

V-5 cymenes; chloroforms; chlorinated dioxins and furans; chloro-acetones, aldehydes, acetic acids (McCubbin, et al., 1992; pp. 123-137). 7 The toxicity of some of these chlorinated organics is well known; others have yet to be studied. The problem of dioxin formation arises because some of the molecular structures characteristic of lignin coincide with the basic dioxin structure but lack dioxins chlorine atoms. Consequently, dioxin is almost certain to occur among the chlorinated organic compounds that are formed when chlorine is used in pulp production. Measures of AOX do not reveal the precise quantity of dioxin, but are indicators of its formation in the bleaching process. The Paper Task Force (1995a, pg. 206) concluded that, The only way mills can ensure that no dioxins are generated during the bleaching process is to eliminate the use of all chlorine compounds. 3. Modifications in the technology of pulp production that reduce or eliminate dioxin formation: the ECF/TCF issue: With the recognition that dioxin and other chlorinated organic compounds are important sources of environmental pollution, in recent years the pulp and paper industry has instituted a series of changes in production technology that are intended to diminish their occurrence in pulp mill effluent. Strategically there are two ways in which this can be done. First, since elemental chlorine is essential to the formation of chlorinated organic compounds, the less it is used the less such formation will occur. Second, the removal of organic compounds that can react with chlorine, especially lignin, from the process before chlorine enters it, reduces the formation of chlorinated organic compounds. Both approaches, separately and in combination, have been used in the recent modifications of the pulp industry. They also, not coincidently, reduce other pollutants and often decrease operating costs as well, because costly inputs and treatment of waste products can be diminished. The chief changes are the following: 

Elimination of Synthetic Dioxin Precursors: Dioxin and/or dioxin precursors have been discovered in pentachlorophenol contaminated wood, paint, defoamers, cutting oils, and other inadvertent inputs to pulp-making. The precursors are easily chlorinated in chlorine-based bleaching, to yield dioxin among other compounds. Strict control is necessary for complete elimination. Enforcement can be difficult. Modified and/or Extended Cooking (delignification) results in a higher rate of delignification in the first processing stage. Since there is less residual lignin when the pulp is ready for chlorine bleaching, less chlorine is needed, tending to
7

Non-phenolic chloro-aromatics (e.g. hexachlorobenzene) are not thought to be formed during chlorine bleaching, since they require pressure or combustion to chlorinate; the small amounts found in pulp effluent must ultimately be attributed to products of the chemical industry which inadvertently accompany pulp inputs.

V-6 reduce the formation of chlorinated compounds, and the total quantity of bleach plant effluent (brownstock washing is recycled to the recovery boiler). Extended cooking can be introduced with relatively little capital investment if the existing equipment can be appropriately modified. The addition of anthraquinone can achieve similar results, with no capital expenditure. 

Improved Brownstock Washing: More efficient brownstock washing removes more of the degraded lignin and other wood by-products from the cooking process, thereby sending more of these wastes to the recovery boiler, rather than to the bleach plant where they would be available for chlorination and appear in the effluent as pollutants. Oxygen Delignification: Treatment with oxygen after cooking can degrade some of the remaining lignin, and also results in some bleaching. Oxygen delignification/bleaching produces no organochlorines. As in the case of extended cooking, it reduces the quantity of bleaching chemicals subsequently needed and the resulting pollutants. The washing from this stage is recycled to the recovery boiler; this significantly decreases the quantity of bleach plant effluent. A significant capital expenditure is needed to build the tower used to introduce oxygen. If the recovery boiler is at maximum capacity, additional expenditures may be necessary for modification or replacement. Ozone Bleaching/Delignification facilitates the use of smaller amounts of bleaching chemicals, thereby lowering operating costs. Ozone bleaching, if followed by hydrogen peroxide, can produce pulp as bright as chlorine processes. Ozone is generally manufactured on-site and therefore requires a substantial capital investment or leasing of an ozone generator. Chlorine Dioxide Delignification and Bleaching: The use of chlorine dioxide instead of chlorine to bleach pulp produces much smaller quantities of chlorinated organic compounds. Chlorine dioxide is a more selective delignifier than chlorine; it degrades less cellulose, but is more expensive. Chlorine dioxide is not believed to directly chlorinate organic molecules. However, reactions of chlorine dioxide during the delignification and bleaching process produce a small amount of elemental chlorine, so that some chlorination of organic compounds does occur. Because chlorine dioxide is extremely unstable, it must be manufactured on-site at the pulp mill, at an appreciable capital investment. Some generators can be upgraded to increase capacity at less cost than others. Hydrogen Peroxide bleaches without introducing new chlorinated pollutants. It is not an effective delignifier but is highly effective in brightening pulp (destroying chromophoric groups). It is most effective when extended cooking and oxygen delignification precedes bleaching. It can be purchased directly (i.e., it does not need to be generated on-site) and application to the pulp-making process

V-7 requires little or no capital investment. Additional process improvements are listed in Appendix Table V-A.2. In the mid-1980's it became known that pulp mill effluents contain sufficient levels of dioxin to seriously affect the edibility of fish downstream. This was officially confirmed by an EPA study of five mills in 1987, which found that significant levels of dioxins were present in 60% of the effluents tested, in more than 75% of the pulps, and in 100% of the waste water treatment sludges (MEB, 1994). Based on these findings, the National Wildlife Foundation and the Environmental Defense Fund filed a lawsuit and obtained a consent decree (TetraTech 1990, pg. v). The U.S. EPA and the industry agreed to undertake a more comprehensive survey, the 1988 104 Mill Study and develop integrated regulations of air, water and land pollution, the 1993 Cluster Rules. It is probably no coincidence that, according to a recent industry publication (AET, 1995), In the late 1980s the North American pulp and paper industry adopted an ambitious strategy to virtually eliminate dioxin. The industrys effort to reduce the entry of dioxin into waterways has produced significant results. The U.S. EPAs 1994 (pg. 3-17) draft dioxin reassessment estimated that dioxin effluent emissions were reduced from 356 grams TEQ per year in 1988 to 105 grams TEQ (in 1993) (based only on the tetra 2,3,7,8 dioxin and furan congeners). These results were achieved largely by making changes in production that were designed to reduce the formation of dioxins at various points in the pulp-making process. The first step was the elimination of possible sources of dioxin precursors that may appear in the brownstock pulp before it is bleached: pentachlorophenol contaminated wood chips, cutting and lubricating oils, defoamers, paints, and other chemical additives (Chung et al., 1990; Vaness et al., 1990; LaFleur et al., 1990; Dimmel et al., 1993). The use of advanced computerized control systems led to additional improvement (Bettis 1991, pp. 81-2). The most significant change in North America in recent years was the progressive displacement of elemental chlorine with chlorine dioxide, a substance already used in the industry to some extent for lignin degradation. Typically, some fraction of the elemental chlorine used in the first bleaching stage (i.e., immediately following the cooking and brownstock washing stages) is replaced by chlorine dioxide. 8 Chlorine dioxide can break down and (to some extent) bleach lignin, but it does not readily chlorinate lignin breakdown products (or other organic compounds). Hence, in

This is peculiar to North America, in the Nordic countries, and modern mills elsewhere, the first bleaching stage usually follows extended cooking or an oxygen delignification stage.

V-8
Environmental Regulations. The Canadian and U.S. governments have recently moved to place new limits on the amount of organochlorine compounds that the industry is allowed to discharge into the environment. In 1993 the U.S. EPA proposed regulations (Federal Register, 12/17/93 and 3/17/94) that mandate effluent and air pollutant limitations on pulp and paper mills, based on the Best Available Technology (BAT). In 1993, the U.S. EPA determined that the BAT for kraft mills was, oxygen delignification or extended cooking with complete substitution of elemental chlorine by chlorine dioxide for bleaching. (See Table V2 below for associated pollutant loadings.) The effect of these proposals was a rapid movement towards investments in chlorine dioxide substitution -- in effect, the ECF approach. The industry associations (AF&PA, NCASI, and AET) have been lobbying the U.S. EPA to relax the proposed AOX regulations to only require 100% chlorine dioxide substitution and not the extended cooking or oxygen delignification. Some U.S. companies that have adopted such technologies have lobbied the U.S. EPA to provide incentives for oxygen delignification (Pulp and Paper Week, April 1, 1996, pg.8-9). Final regulations are planned to be issued in 1996. The Ontario rules proposed in 1993 (Ontario Gazette, 11/25/93) set a schedule for reduction of organochlorine loadings from pulp mills, with the goal of completely eliminating them by the year 2002. However, the intention of the new government in this regard is not clear. Ontario mills have had continual monitoring of effluent toxicity with direct oversight by the provincial government. Their mills are to reduce AOX emissions to 0.6 kilograms per metric ton of pulp by 1996. In the Nordic and other European countries, the impact of environmental concerns on the development of pulp process technology has taken a different course. While in North America the industry responded to conventional pollutant problems with large investments in pollution control, primary and secondary treatment of effluent, the Nordic countries invested in pollution prevention, extended cooking and oxygen delignification. 9 While these technologies have provided the basis for the development of a lower effluent, lower polluting ECF process than that being implemented in North America, they also paved the way to an alternative approach. Nordic countries have recognized the general desirability of the position developed by the International Joint Commission -- that wherever possible all uses of chlorine should be eliminated from manufacturing processes. In the Nordic countries this has encouraged the development of Totally Chlorine Free or TCF pulpmaking. Regulations in the Nordic countries have encouraged these pollution prevention technologies and TCF. (See discussion below in section E). The World Bank (1995, p. 2) identified the most significant environmental issue for the paper and pulp industry to be the use of chlorine bleaching. They determined that TCF is a demonstrated feasible technology for many pulp and paper products and recommended TCF bleaching in these instances.

These are pollution prevention technologies, because they produce no chlorinated organics and recycle wastes to the recovery boiler.

V-9 comparison with chlorine, the use of chlorine dioxide sharply reduces the chlorinated organic compounds (AOX) in the pulp mill effluent. However, even when elemental chlorine is entirely replaced with chlorine dioxide, the amount of AOX in the effluent is not reduced to zero, but by 80%. (See Appendix Table V-A.3) This means that some chlorination of organic compounds occurs even when bleaching is done with 100% chlorine dioxide, and no elemental chlorine is added. This appears to be the result of a tendency of chlorine dioxide to produce a small amount of elemental chlorine through reactions in the bleaching process. Chlorine produced in this way is then capable of chlorinating lignin breakdown products and other organic compounds. When elemental chlorine and hypochlorite is completely replaced by chlorine dioxide (100%), the process is known as Elemental Chlorine-Free (ECF) pulp production. However, as noted above, this term is not entirely correct, for a small amount of elemental chlorine accompanies the use of chlorine dioxide. Table V-1 distinguishes the three major types of pulp-making and bleaching processes (see also Appendix Fig. V-A). The older, conventional, process uses elemental chlorine for the first delignification and bleaching stage; the chlorine dioxideECF process replaces elemental chlorine bleaching with chlorine dioxide; the TCF process uses extended cooking and oxygen to accomplish effective delignification and ozone and hydrogen peroxide -- in place of chlorine and chlorine compounds -- for bleaching. The chlorine dioxide-ECF process has developed into three tracks:   ECF-1: Adaptation of old chlorine and hypochlorite stages to chlorine dioxide, with investments in expanded chlorine dioxide capacity; ECF-2: Modernized mills with extended cooking and oxygen delignification converted to chlorine dioxide for bleaching (a process encouraged in the 1993 U.S. EPA proposals); ECF-3: Advanced mills also with extended cooking and oxygen delignification, that use chlorine dioxide only in the last stage of bleaching, after the pulp has been delignified and bleached by non-chlorine compounds, like ozone and hydrogen peroxide.

ECF-3 technology enables the wastes from all pulping and bleaching stages before chlorine dioxide to be recycled, and leaves little residual lignin to chlorinate and pollute. Union Camp has installed this process in a mill in Virginia. E.B. Eddy has been experimenting with an ozone pilot plant in Espanola, Ontario. Mills using chlorine dioxide ECF-2 and ECF-3 technologies can be converted to TCF processes, without significant additional capital expenditures.

V-10

Table V-1
Process Stage & Symbol

Kraft Chemical Pulping and Bleaching Processes*


Chlorine Dioxide, ECF Description Elemental Chlorine Adapted Traditional (ECF-1) Modern (ECF-2) Advanced Low Effluent (ECF-3) TCF Totally Chlorine Free

Conventional Cooking

Delignification. Cooking with sodium hydroxide (NaOH) and sodium sulphide (Na2S) liquor. Extended delignification with equipment modification or addition of Anthraquinone, Aq. Recovery of cooking liquor and removal of lignin O Extends the delignification process started with cooking. O 2 Bleaching with further delignification elemental chlorine, Cl 2 Bleaching with Sodium or Calcium Hypochlorite, NaOCl or Ca(OCl) 2 Bleaching with further delignification, ClO2 Further delignification and bleaching for bright pulp. O 3 Bleaches lignin and pulp with hydrogen peroxide. H 2O 2 Caustic extraction (NaOH) of chlorinated and/or oxidized lignin; follows initial or intermediate C, D, or Z stage. Enhanced caustic extraction with oxygen and/or peroxide bleaching.

Yes

Yes

No

No

No

Extended Cooking

No

No

Yes

Yes

Yes

Brownstock Washing Oxygen (O2) Delignification Chlorine Bleaching Hypochlorite Bleaching Chlorine Dioxide Bleaching Ozone Bleaching

Yes

Yes

Yes

Yes

Yes

No

No

Yes

Yes Yes

Yes

No

No

No

No

Sometimes Sometimes No

No

No

No

No

Yes

Yes

Yes

No

No

No

Yes

Sometimes Yes

Peroxide Bleaching Extraction

No

Rarely

Rarely

Sometimes

Yes

Yes

Yes

No

No

Enhanced Extraction

Eo Ep

Sometimes

Sometimes

Yes

Yes

Sometimes

Successive Bleaching Stages

Bleaching stages are typically repeated 2 to 4 times for brighter and whiter pulp. Intermediate stages are usually followed by extraction (except for peroxide).

Yes

Yes

Yes

Sometimes

Sometimes

* Kraft pulping is distinguished from soda and sulfite mills by cooking with sodium sulfide. Many of the same bleaching processes can be used for kraft, soda and sulfite mills. Ammonium based sulfite mills may have difficulties with TCF.

V-11 All TCF processes require modern oxygen delignification and typically use anthraquinone or mechanical improvements to the cooking equipment for extended delignification. Production of TCF pulp has taken two tracks:   The use of hydrogen peroxide instead of chlorine dioxide with basically the same capital equipment as ECF-2 (except the chlorine dioxide generation equipment); Investments in advanced ozone technology as the minimum effluent ECF-3, but with the use of hydrogen peroxide in the final stage.

The TCF mills can convert to closed loop totally effluent free (TEF) with known technologies. Chlorine dioxide mills that seek to adopt TEF technologies are still in the experimental stage. These mills have the special difficulty of removing chlorine chemicals from the filtrates so as not to damage equipment, and of disposing of the chlorinated organics produced by chlorine dioxide. C. The Environmental Effects of Chlorine Dioxide-ECF and TCF Technology: As noted earlier, the development of chlorine dioxide-ECF and TCF technologies have been motivated by the environmental importance of reducing the generation of dioxin and other toxic chlorinated organic compounds. There is evidence that this effort has succeeded in significantly reducing the amounts of these pollutants entering the Great Lakes from pulp mill effluents, but not in eliminating them. This is evident, for example, from the U.S. EPAs review of its own sample mill studies and its evaluation of dioxin data collected by the industry trade association, the National Council of the Paper Industry for Air and Stream Improvement (NCASI). Using the direct facility measurements of the 1988 104 mill study as a reference, U.S. EPA (1994) determined that the tetra-chlorinated dioxin in effluents declined in the U.S. from 356 g TEQ/ year in 1988 to 105 g TEQ/year in 1993, with a statistical variation estimated to be 74-150 g TEQ/yr. 10 This amounts to a decrease of somewhere between 60 to 80%. NCASI has estimated a decrease of 90% to 34 g TEQ/yr in 1992. However, U.S. EPA found that NCASIs method of aggregating the mill data was

U.S. EPA (1994, pg. 3-15, citing U.S. EPA, 1990b) has estimated that other dioxin and furan congeners add up to 10% of the TEQ values of the tetra congeners. Clement, et al., (1989) from the Ontario Ministry of Environment, centrifuged large volumes of effluent (480 L), enabling detection of toxic congeners in bleached kraft mill effluent not found by traditional methods. Their results demonstrate the importance of other dioxin congeners and mill-to-mill variance. Additionally, recent research documents shifting AOX composition in ECF effluent. These results suggest that congener distribution is of such variability from mill to mill that any analysis limited to tetra detection is not likely to be an accurate predictor of total TEQ, as U.S. researchers assume. Ontario survey data reported to CBNS reinforce these concerns: dioxin/furan congeners other than tetras were detected, and varied unpredictably from mill to mill.

10

V-12 scientifically unacceptable because of the poor quality of many of the separate dioxin values reported to NCASI, and serious methodological deficiencies of the data collection. U.S. EPA readjusted the NCASI data for its own estimates; unfortunately, the methods used for this purpose are not available to independent researchers because they involve confidential mill data and unpublished U.S. EPA studies and documentation. The same difficulties seem to apply to the changes in the dioxin content of effluents from the five U.S. kraft and soda mills in the Great Lakes region. The 104 mill 1988 study reported that these mills released 2.62 g TEQ of dioxin, of which we estimate that 2.09 g TEQ reached the lakes. The 1993 data available from NCASI exhibit the same sorts of problems that EPA has noted. It is apparent from the literature that a permanent reduction in the dioxin content of pulp mill effluent can only be accomplished by appropriately changing the production technology -- for example, by replacing elemental chlorine bleach with chlorine dioxide or a non-chlorine agent such as hydrogen peroxide. Thus, two of the Great Lakes mills (Mead, Escanaba, MI, and International Paper, Erie, PA), which made such changes in production technology between 1988 and 1993, report a 90% reduction in effluent discharge of dioxin. However, a number of other U.S. Great Lakes mills report similar reductions in dioxin discharges even though there were no reported changes in production technology that would be expected to cause this decrease were introduced during that period of time. Since the 1993 level is generally based on only one measurement, it is quite possible that its low value represented a temporary fluctuation in dioxin discharge rather than a permanent improvement. Although 1988 dioxin discharge levels for the Canadian (Ontario) Great Lakes pulp mills are unavailable, their more recent measurements do not suffer from the problems noted by the U.S. EPA. Indeed, the Ontario data, although like the U.S. measurements are self-reported, have been confirmed by Environment Canada (IJC 1995, p. 39-40). It is also of interest that although all four Ontario mills had substituted chlorine dioxide for chlorine by 1993, the levels of dioxin in their effluents were generally higher than those reported by U.S. Great Lakes mills that had not made such dioxin-reducing changes in production technology during that same period. The NCASI reporting procedure allows mills to choose what they consider samples of representative of mill conditions, so dioxin level variability and statistical calculations of means are not necessarily provided. What is chosen by a mill manager as representative conditions may be ideal conditions, yielding a downwardly biased estimate. When a mill reports a non-detect, NCASI allows this mill to reaffirm the nondetect status without further testing, provided that in their opinion, relevant mill conditions have not changed. This results in a structured sampling bias from the systematic attrition of data points. Consequently, the NCASI data may have a bias downward. What we see in more rigorous, regular testing with independent oversight, such as the Ontario data, is that samples will be interspersed with detects and non-

V-13 detects. In view of these uncertainties about the dioxin discharge data, it seems prudent to conclude that overall reductions in dioxin levels in the effluents from the Great Lakes pulp mills that can be related to the relevant changes (e.g., substitution of chlorine dioxide for chlorine bleach) in production technology probably reflect about the same reduction reported by U.S. EPA: 60-80%. These developments have brought the issue of environmental improvement to a new level: should the levels of dioxin and other chlorinated pollutants be further reduced -- indeed to zero -- by eliminating the use of all forms of chlorine in pulp and paper production? The affirmative position is advocated by the International Joint Commission and environmental organizations; many, but not all, industry representatives have argued in the negative. In order to understand the relative merits of these opposing views, it is useful, here, to clarify the operational meaning of pollution prevention. Pollution prevention is based on the strategy of altering a system of production by eliminating from it the component process that generates the pollutant. The classical example is the prevention of lead emissions from automobiles. This was accomplished by omitting from the production of gasoline the step in which tetraethyl lead is added as an antiknock agent. This completely eliminates the possibility that lead additives will be emitted when the fuel is used. The component process that is responsible for the generation of dioxin in pulp production has been identified: it is the reaction of elemental chlorine with lignin residues to form dioxins and other chlorinated organic compounds. In this instance pollution prevention means totally eliminating the presence of elemental chlorine in the production system, thus ending any possibility that dioxin will be formed. In pulp production, pollution prevention, as applied to dioxin, means totally chlorine-free production: TCF. The claim that ECF virtually eliminates dioxin in pulp processing also often reflects the fact that whereas measurable amounts of dioxin were found in the pulp and effluent produced by mills using chlorine bleaching, in corresponding measurements at ECF mills most of the readings are not detected. As pointed out in the accompanying box, this reading does not mean zero, but only that the amount of dioxin is below the level that the particular analytical procedure can detect. Hence, the actual dioxin level may be anywhere between zero and just below the detectable limit. Although there are approximate methods based on statistical probability of interpreting the meaning of non-detects, these methods are applicable only when there is a sufficient mixture of detected measurements with non-detected measurements. In the absence of large sample sets, a good deal of uncertainty remains. Despite this difficulty there is evidence that dioxin is formed in chlorine dioxide-ECF mills and is not formed in TCF pulp mills.

V-14

What non-detect means. In spite of the fact that the technology for measuring pollutants in the environment has been improved over the years, there are limits to the measuring abilities of even the very best analytical equipment. When an environmental sample, e.g. a sample of pulp mill liquid effluent, is analyzed for a particular pollutant, such as 2,3,7,8-tetrachlorinated dioxin, there is a detection limit associated with the measurement. If the pollutant is present at an amount less than this limit, then the analytical procedure will not be able to detect it. There are many factors that can contribute to such a limitation. One common factor is noise in the electrical circuitry of the measuring technology. The detection limit will be different for each pollutant measured and will depend on the analytical methodology, the equipment utilized, and the nature of the environmental sample. Thus, there can be a different detection limit for the same compound in the same laboratory for a set of river water samples as compared to a set of pulp mill effluent samples. Typical detection limits reported for dioxin congeners (such as 2,3,7,8-tetrachlorinated dioxin and 2,3,7,8-tetrachlorinated furan) measured in pulp mill effluent samples have been in the range of 1-5 picograms of pollutant per liter of water (1-5pg/lit). The U.S. EPA has typically required pulp mill samples to be analyzed with a detection limit no higher than 10 pg/lit. If the dioxin content of a pulp mill sample is less than the detection limit of the particular analytical situation, then it will be reported as non-detect. This does not mean that there are no dioxins or furans in the effluent. It only means that the level is probably less than the stated detection limit. Another confusing reporting practice occurs when dioxin is detected with a sensitive analytical technique, but reported as below USEPA detection limit 10 pg/lit. or non-detect at 10 pg/lit., USEPA approved method, leading the reader to believe dioxins were not detected. NCASI has extended this rational of non-detect to 100pg/lit for 2,3,7,8 tetrachlorinated furans, because the TEQ is 1/10th of 2,3,7,8 tetrachlorinated dioxin. In using these data, one must consider that the actual level of each non-detected compound is somewhere between zero and the detection limit for that compound. A value of onehalf the detection limit is generally chosen as a mid-range estimate of the compounds actual concentration. Due to their extreme toxicity, the detection limit issue is of particular concern for dioxins. Because they can bioaccumulate, dioxins can be responsible for toxic effects in aquatic systems even if they are present in water at levels below conventional detection limits. Thus, even though 2,3,7,8-tetrachlorinated dioxin has never been measured above the detection limit in Great Lakes water, it is routinely found in the regions fish and wildlife at toxicologically relevant concentrations.

Indirect but numerical evidence is available from measurements of AOX in pulp mill effluents. In such effluents AOX represents an unresolved mixture of a variety of chlorinated organic compounds, and a difference in AOX levels can in many instances reflect differences in the degree to which such compounds -- including dioxin -- are formed. Table V-2 summarizes several comparisons of the AOX concentrations in the bleach effluents of modified traditional mills, ECF and TCF kraft pulp mills. It is apparent from these reports that the AOX levels from the TCF plants are reduced at least a thousand-fold in comparison with the ECF plants levels -- and are perhaps indistinguishable from background levels.

V-15 Table V-2 Pollutant Effluent Loadings of Different Processes: Elemental Chlorine, Chlorine Dioxide-ECF and TCF
AOX Process Chlorine Bleaching a
(same mill, different process)
(1)

BOD5
kg/metric ton pulp

COD
kg/metric ton pulp

Color
Pt-Co
c

kg/metric ton pulp

Traditional(1) O2 Deliginification (1) Modified Cooking & O2 Delignification (1) 70%ClO2 /30%Cl2 & Modified Cooking & O2 Delignification (1) Chlorine Dioxide ClO2 Bleaching- ECF b ECF-1 Adapted Traditional ECF-2 Modern
(3,8)

7.9 4.7 3.6 1.9

28 22 20 20

100 70 55 55

300 100 80 65

1.5-2.1
(2)

8-13 (9)
no (d,2) change

32-60
(9)

23-43
(8,9)

.36-69

9.5-10.4

20.1-30.6

19.7-46.8
(4)

ECF-3 Advanced Low Effluent TCFb Chlorine-Free range of technologies TEF (by definition)

.04-.08
(3,4,6)

2.5-6.5
(3,7)

13.0-22.5
(3,7)

0.5-5.8
(4,11)

nde-.002
(4,5)

8.4-23.0
(3)

16-77.8
(3,5)

2.0-6.6
(3,4)

Notes: a) Chlorine bleaching process combinations are from testing of the same mill. b) ECF and TCF loadings are from commercial mill and pilot mill data. c) Color is measured by chloroplatinate units (Pt-Co) and expressed as kg/metric ton. d) According to McCubbin and Paper Task Force, ECF itself does not have any effect on BOD or COD. e) Detection limits appear to be below .01, but have not been consistently reported. Sources: 1) Galloway, 1991, 2) McCubbin, 1992; McCubbin, et al., 1992, 3) deChoudens, et.al, 1995 4) Bicknell, et.al., 1995, 5) Vice, et.al., 1995, 6) Lancaster, et.al., 1992, 7) Nutt, et al., 1993 8) Panchapakesan, 1991, 9) Johansson and Fletcher, 1994, 10) Helge, 1995, 11) Trice, 1992.

The relative amounts of carbon atoms (C) bonded to chlorine (Cl) atoms in organic effluent wastes is an index (expressed as C/Cl ratio) of the degree of lignin chlorination and may be useful to indicate the degree that toxic chlorinated dioxin is

V-16 formed, when quantification of such dioxin is not possible. 11 Thus, a C/Cl ratio of 1000 means that, in the mixture of AOX compounds, on average there is only one carbon atom in every thousand to which a chlorine atom is attached -- that is, a low degree of chlorination. Studies of high molecular weight materials (HMWMs), the very large compounds which form the bulk of the chlorinated organics (AOX), yield the following results regarding C/Cl ratios in mill effluents:    Chlorine dioxide ECF-1 processes produce the highest degrees of chlorination (C/Cl ~ 83-90); The process with the greatest delignification prior to chlorine dioxide bleaching (ECF-2) produces intermediate chlorination levels (C/Cl ~ 260); The TCF process produces the lowest degree of chlorination, which is fully comparable to chlorine contents found in naturally occurring humic materials (C/Cl ~ 590-1400) (Dahlman et al., 1994).

Studies on organic compounds more similar to dioxin, such as phenolics, have had similar results (Tsai, et al., 1994; Schwantes and McDonough, 1994). Kovacs, et al. (1995) discovered chlorinated phenolics in untreated (157g/L) and treated ECF effluent (54.7g/L) but none in untreated TCF effluent (the detection limit was 0.1g/L). Phenolics are likely to be formed from lignin by the same process as dioxin, and may serve as the building blocks for dioxin. The detection of even small amounts of polychlorinated phenolics in the best ECF mills led Tsai et al. to conclude that their findings support the hypothesis that elemental chlorine can be formed during the initial reaction of chlorine dioxide with some lignin structural units. Saunamki (1995, pg. 191), studying chlorinated phenolics and AOX, concluded that TCF pulping produces no organic chlorine compounds. Another indirect method that may reveal the presence of dioxin, and other difficult-to-quantify toxic chlorinated organics, is to compare the sublethal effects (e.g. reproduction and growth) on aquatic life of TCF and ECF effluents. The most recent advanced sublethal toxicity studies have demonstrated that TCF mill effluent is less toxic than the modern ECF-2 effluents, which in turn are less toxic than the adapted ECF-1 effluent (Lvblad and Malstrm, 1995; Kovacs et al., 1995; Cates, et al., 1995;

Even if the bulk of chlorinated organics produced is the less toxic monochlorinated organics, as long as the chlorine to carbon ratio is substantially above natural levels, there will be a greater likelihood that a certain percentage of organic molecules will encounter a free chlorine atom a number of times, resulting in polychlorinated compounds, including dioxins. That is, the greater the chlorine to carbon ratio, the greater the likelihood of the creation of the toxic polychlorinated compounds, including dioxins.

11

V-17 Paper Task Force, 1995c pg. 46).12 The low levels of toxicity observed in TCF effluent is thought to be derived from bioactive compounds naturally occurring in the trees (Paper Task Force, 1995c, pg. 44-50). Sdra Cell, a producer of ECF and TCF pulp, found these toxicity studies to be so persuasive as to reverse its previous neutral position on modern ECF vs. TCF with extended cooking and oxygen delignification (often quoted by AET) and advocate TCFs environmentally superior qualities, leading the company to convert all of its ECF mills to TCF (Sdra Cell, 1995). A direct test of the reality of the difference in dioxin formation at a modern (10%chlorine/90% chlorine dioxide13) ECF and TCF mill has very recently been provided by Rappe and Wagman, who measured the tetrachlorinated dioxin (TCDD) and tetrachlorinated furan (TCDF) content of pulp from the same mill operating in both the ECF and TCF configurations (Rappe and Wagman 1995). These measurements were made on the mills pulp, using an analytical technique about 30 times more sensitive than the conventional method. (Earlier studies have shown that the total output of dioxin from pulp bleach plants is approximately equally divided among the effluent, pulp, and effluent treatment sludge, U.S. EPA, 1994, pg. 3-16.) Rappe and Wagman found that even with the highly sensitive analytical method, many of the measurements of TCDD in pulp were non-detect. However, all of the measurements of TCDF, which is known to occur at higher levels than TCDD in chlorine bleaching processes, were actual values above the detection limit. 14 The TCDF results are summarized in Table V-3. In these computations we have used the numerical values not only for the final pulp, but also for the brownstock pulp and the analytical blank, as reported by Rappe and Wagman, to evaluate a specific effect -- that is, the amount of TCDF that is formed as a result of the bleaching process. For this purpose, it is important to note that the bleaching process -- which is, of course, the crucial difference between ECF and TCF -- acts on the brownstock pulp, which is thereby converted to the final pulp. Hence, any formation of TCDF that is caused by the bleaching process will show up as a difference between the TCDF content of the
12

An earlier laboratory study (OConnor et al., 1994) showed greater toxicity of untreated TCF effluent and similar toxicity to ECF in treated effluent. Subsequent research has discovered this unusual result to arise from residual peroxide and a laboratory procedure to remove it with sodium meta bi-sulfite. Learning from these and other errors, studies now screen for residual hydrogen peroxide in TCF effluent and chlorate in ECF effluent, conditions easily prevented or removed during regular mill operations. (Nelson et al., 1994; Paper Task Force, 1995c, pg.45; Lvblad and Malstrom, 1995) Some of the older chlorine dioxide generators can produce this amount of elemental chlorine as a by-product. Other mills intentionally bleach in these proportions rather than 100% chlorine dioxide to save on chemical costs or due to limited chlorine dioxide capacity. The TCDF analyses reported by Rappe and Wagman measure the concentration for a group of six TCDF congeners as a whole. The group includes 2,3,7,8-TCDF, which is the only toxic TCDF congener. In our discussion of this study we will refer to this group of six TCDF congeners as TCDF.
14 13

V-18 pulp and the brownstock. In Table V-3 we have corrected the brownstock and final pulp values by subtracting the values of the analytical blanks -- which represent the apparent TCDF value yielded by running the analytical procedure without an actual brownstock or final pulp sample. Then, in order to record the TCDF actually formed in the bleaching process, the corrected brownstock values are subtracted from the corrected pulp values. A clear-cut difference between the ECF and the TCF process can then be seen. Table V-3: Concentration of 2,3,7,8-TCDF and 5 Other TCDF Isomers in ECF and TCF Pulp Samples (pg/g of pulp)
Mill Sample Pulp Blank Pulp-blank = Corrected pulp Brownstock Blank Brownstock-blank = Corrected brownstock Corrected pulp-corrected brownstock Detection limit: 0.02 pg/g
Source: Rappe and Wagman (1995)

ECF #1 0.29 0.05 0.24 0.06 0.05 0.01 0.23

#2 0.25 0.05 0.20 0.07 0.05 0.02 0.18

Average 0.270 0.050 0.220 0.065 0.050 0.015 0.205

TCF #1 0.08 0.04 0.04 0.07 0.04 0.03 0.01

#2 0.09 0.04 0.05 0.06 0.04 0.02 0.03

Average 0.085 0.040 0.045 0.065 0.040 0.025 0.020

In the ECF process, the brownstock contains an average of 0.015 pg/g of TCDF and the pulp contains an average of 0.220 pg/g. Hence, ECF bleaching produces 0.205 pg/g of TCDF. In the TCF process, the brownstock contains an average of 0.025 pg/g of TCDF and the pulp contains an average of 0.045 pg/g of TCDF. The difference between these levels, 0.020 pg/g, would presumably represent the amount of TCDF produced in TCF bleaching. However, this difference, which is equal to the detection limit, is so small that it does not provide reliable evidence that

V-19 TCDF was in fact formed. Hence these data, which are the most sensitive analysis of the process, fail to provide evidence that PCDF is formed during TCF bleaching.15 Two major conclusions can be drawn from the available evidence regarding the impact of conventional (chlorine) bleaching, ECF (chlorine dioxide) bleaching and TCF (totally chlorine free) bleaching on dioxin production. First, the substitution of chlorine dioxide for chlorine in the bleaching of virgin pulp can result in about a 10-fold reduction in the formation of dioxin, but does not eliminate it. Second, there is direct evidence, from the most sensitive comparison of dioxin formation in ECF and TCF pulp production, that while a measurable amount of dioxin (specifically, TCDF) is formed in ECF bleaching, there is no evidence that TCDF is formed in TCF bleaching, which is accomplished by the total absence of all forms of chlorine in the bleaching chemicals. Finally, it should be noted that there is a realistic limit to what can be accomplished even in a TCF system, in which no chlorine in any form is added to the process. It has become literally impossible that any U.S. or Canadian industrial process that is exposed to the open air can be absolutely free of dioxin. As shown in our initial report, our analysis of the movement of the airborne emissions of dioxin in the United States and Canada show that they become widely disseminated in the atmosphere and deposit everywhere as a kind of chemical fallout. Simply stated, even if absolutely no chlorine or chlorine compounds are used in a pulp mill, the mill operations -- like every other activity in industrial countries -- and the trees that are made into pulp -- are exposed to the fallout of airborne dioxin, emitted by thousands of separate sources (most of them incinerators) and carried through the air for thousands of miles (see Cohen et al., 1995). D. Economic Analysis: 1. The economic feasibility of ECF and TCF technology: As we have seen, the pulp and paper industrys response to the need for environmental improvements in the 1990s has been largely based on changes in the technology of production. Earlier, in the 1970s and 1980s their response to environmental regulations was largely to improve end-of-the-pipe control systems -usually at high cost. However, since then, rather than attempting to control pollutants after they have been produced, the industry has been guided by the strategy of pollution prevention. In economic terms, this process is, of course, governed by investment decisions -- that is, by a companys willingness and/or ability to undertake the capital expenditures that are needed in order to modify or replace the production
In the same study, ECF pulp from a different modern mill (100% chlorine dioxide) was analyzed and also found to produce significant increases in the amount of TCDF and, as represented in TEQ values, in other congeners as well.
15

V-20 equipment. In turn, a major factor that influences the companys ability to assemble the necessary investment funds is the expected return on the investment. This depends on the impact of the new production process on the price that the product can command, which finally depends on how much can be sold -- that is, on the demand for it. Thus, in industrial practice, the decision to make a change in production technology depends on the balance between the cost of the necessary investment and the expected returns. Environmental factors can have a powerful effect on both sides of this equation. Changes in process technology that reduce the amount of pollutants generated during production can decrease expenditures for installing and operating pollution control systems required by environmental regulations. Often, these changes involve more efficient use of material inputs. These savings in capital and operating costs can help to compensate for the cost of the capital investment in the new pollution prevention technology. The replacement schedule for existing, older capital equipment is another crucial factor affecting pollution prevention financial decisions. If existing equipment is physically degraded or obsolete, and therefore needs to be replaced, this can often be accomplished with equipment that prevents pollution at no more cost than replacing it with equipment of the original design. Mill expansions provide similar opportunities. Barriers to pollution prevention investment exist when a plant is still burdened with debt from its existing technology, or is extracting high economic returns from durable equipment it has already paid off. Another case arises when an entire mill production line has been under invested for some time. Such mills may be so obsolete that the company plans to use them until they fully deteriorate, and tend to resist modernization or investment in pollution prevention. On the other side of the equation, environmental concerns can increase the demand for paper products free of dioxin and other chlorinated pollutants, enhancing the price that such products can command and creating a new distinct, market for them. Especially in recent years, the industrys investment pattern has been strongly influenced by such environmentally motivated demand, especially for recycled and chlorine-free paper -- generally under pressure from environmental organizations and an environmentally aware public. Accordingly, in evaluating the feasibility of investments in environmentally motivated changes in production technology, it is important to consider as well the impact of environmental factors on both the availability of capital, and on the demand for the new products -- and hence the price at which they can be sold. The industry has recently made a considerable effort to introduce changes in pulp production that can significantly reduce the levels of dioxin, and more generally of organochlorine compounds (AOX), in plant effluents. As we have seen, the complete substitution of chlorine dioxide for chlorine in the bleaching process (ECF) can reduce AOX levels by about 80%. ECF considerably reduces the generation of dioxin, but

V-21 some is still produced during bleaching. In contrast, in the TCF process there is no convincing evidence that dioxin is produced at all during bleaching. Unlike ECF, the available evidence indicates that the TCF process does in fact eliminate the entry of industry-generated dioxin into the environment. The practical question is whether this difference is worth the effort -- and expenditure -- needed to achieve the more stringent, dioxin-free TCF condition. The issue in the Great Lakes region, therefore, is to choose between chlorine dioxide-ECF and TCF as the goal to be reached in order to achieve the virtual elimination of dioxin in pulp mill effluents and paper. Such a decision involves a comparison of the relative costs of converting the existing pulp mills to ECF or TCF. But it also involves the relative impact of ECF and TCF on other environmental goals, for example the virtual elimination of organochlorine AOX pollutants other than dioxins, and on the possibility of moving toward totally effluent-free (TEF) production. Accordingly, in what follows we analyze the economic consequences of converting the Great Lakes chemical pulp mills present elemental chlorine-based pulp processes to ones that conform to the chlorine dioxide-ECF and TCF criteria. Due to the objective of our study, virtual elimination of dioxins in the Great Lakes, we have limited our study to pulp and paper mills that release chlorinated effluents directly or indirectly into the Great Lakes. These include eight kraft mills, one soda mill, one sulfite mill, and ten deinking mills. a. Kraft and soda mills: Kraft and soda pulp mills need to undergo the most substantial conversion in order to eliminate dioxin production. There are nine such mills that account for most of the waterborne organochlorine pollution entering the Great Lakes from pulp mills. They range in output from 225 to over 1500 metric tons of pulp per day. They ship $2.7 billion worth of pulp and paper, employ nearly 9,000 people, and have a payroll of nearly $400 million dollars (see Table V-4). The mills differ in their product lines and production technologies. As noted earlier, the U.S. EPA is recommending the chlorine dioxide elemental chlorine free (ECF) strategy for kraft mills as a means of reducing organochlorine pollution. This strategy was proposed in the 1993 "cluster rules" (to be final in 1996 and implemented by 1999) -- a set of alternative process changes that firms can use to reduce air and water pollution, including waterborne dioxin. In particular, the cluster rules call for 100% chlorine dioxide substitution for elemental chlorine and the inclusion of either extended cooking delignification or oxygen delignification (what we call the

V-22 Table V-4: Great Lakes Pulp & Paper Mills Economic Estimates 1992 Shipments, Expenditures, ($US millions) and Employment
Source Name KRAFT&SODA MILLS Canada Avenor E.B.Eddy James River Kimberley-Clark Canadian Subtotal United States Champion International Paper Mead Potlatch S.D.Warren (Scott) U.S. Subtotal Kraft & Soda Subtotal SULFITE MILL Badger Paper Mills DEINKING MILLS EcoFibre Fort Howard Fox River Fiber James River James River Kerwin Ponderosa Pulp P.H. Glatfelter Scott WorldWide Wisconsin Tissue Deinking Subtotal TOTAL Peshtigo DePere Green Bay DePere Ashland Green Bay Appleton Oshkosh Neenah Oconto Falls Menasha Quinnesec Erie Escanaba Cloquet Muskegon Source Location Value of Shipments Employment Payroll Value Added Materials Cost Annual Capital

Thunder Bay Espanola Marathon Terrace Bay

540 262 114 278 1,195 395 243 508 228 86 1,460 2,655 65 12 658 34 19 138 39 31 117 13 263 1,328 4,050

1400 860 300 720 3,280 1,490 1,070 1,970 880 330 5,740 9,020 230 40 2,230 100 70 470 170 90 490 40 1160 4,850 14,090

65 36 14 33 148 65 45 84 38 14 246 394 9 2 93 4 3 20 7 4 20 2 49 203 606

245 119 53 130 547 185 113 224 100 38 660 1,206 31 6 326 16 10 68 18 17 52 7 122 638 1,876

296 143 62 151 652 212 131 285 128 48 804 1,456 34 7 333 18 10 70 22 17 66 8 142 693 2,183

48 23 15 37 123 49 28 31 14 5 127 251 4 2 62 5 2 13 5 4 14 2 30 138 393

Notes: The mill data are derived from general industry data and mill specific output and product lines. Actual mill data will vary due to product line concentration specialization, mill integration, technology and productivity. Sums may not always add due to rounding. Data Sources: 1993, 1994, 1995 Lockwood Post; 1992 U.S. Census of Manufacturers; Pulp & Paper 1994 North American Fact Book; Direct CBNS Survey; Corporate Annual Reports and SEC 10K Filings.

V-23 Modern ECF-2" mill in this report). This proposed regulation has already had a considerable influence on kraft pulp mills investment decisions; they have generally moved toward converting to 100% chlorine dioxide ECF processes. Conversion to 100% chlorine dioxide substitution entails large capital investments. Chlorine dioxide is extremely unstable and must be generated on-site in specialized generators. A mill that invests in chlorine dioxide technology will have an incentive to recoup its investment within about 15 years. In a typical mill that has no existing chlorine dioxide capacity, the costs include about $15 million for a new chlorine dioxide generator (30 metric tons per day), $13.5 million for a new chlorine dioxide tower and washer (750 air-dried metric tons pulp per day), and $2 million for a recausticizing upgrade (Radian, 1995). All of the kraft and soda mills in the Great Lakes region have already made some investments in equipment for generating chlorine dioxide -- which has been used for a long time as a way of achieving higher brightness and minimizing the fiber breakdown caused by 100% chlorine bleaching. As noted earlier, expanding usage to 100% chlorine dioxide reduces the formation of organochlorines (including dioxins), but does not entirely eliminate them from the effluent. This is particularly true when chlorine dioxide is used in the initial delignification stage; there, the relatively high concentrations of lignin considerably enhances the formation of chlorinated organic compounds from even the small amount of elemental chlorine generated by the use of chlorine dioxide. The production sequences currently used in the nine Great Lakes kraft and soda mills are summarized in Table V-5. For this purpose we used the latest information on each mill's capacity, technology and bleaching sequence available from the 1996 Lockwood Post Directory, from a survey conducted for CBNS by the Ontario Forest Industries Association, and from the mills themselves. These data show that the Great Lakes kraft and soda mills, in different degrees, have been following the approach described in the proposed U.S. EPA regulations. Of the nine mills, four -- Avenor, James River-Marathon, Champion International, and Potlatch -- have adopted 100% chlorine dioxide bleaching; E.B. Eddy and Kimberly Clark are equipped to do so intermittently. Three mills have made this substitution only partially, and two mills are reported to still use 100% elemental chlorine in the first bleaching stage. Two of the mills have adopted oxygen delignification and extended modified cooking, and three are using hydrogen peroxide bleaching together with chlorine dioxide or chlorine. As we have pointed out above, it is environmentally preferable to adopt the totally chlorine free (TCF) bleaching process and move towards a totally effluent free process. Here, we analyze the economic consequences of making the changes in production technology needed to convert the existing Great Lakes kraft and soda mills into either the ECF or TCF configurations. It is useful to start with analyses of the

TABLE V-5: CHARACTERISTICS OF GREAT LAKES KRAFT & SODA PULP MILLS
PULP OUTPUT METRIC TONS/DAY FACILITY NAME (1) BLEACHING SEQUENCE (2) FIBER FURNISH S-Softwood H-Hardwood Extended or Modified Cooking Oxygen Deliginification O DELIGNIFICATION AND BLEACHING PROFILE First Bleaching Stage Elemental Chlorine % C ClO2 % D Hydrogen Peroxide P, Ep or Eop H Hypochlorite Elemental Chlorine Free ECF Total Chlorine Free TCF (3) Radian GROUP TYPE Paper Task Force (4)

CANADA Avenor (former CPFP) 755 755 E.B. Eddy 500 500 James River- Marathon Kimberly-Clark 499 880 380 UNITED STATES Champion International International Paper Co Mead Corp. 1,043 885 794 962 Potlatch Corp. 91 399 S.D. Warren Co. (Scott) TOTAL 227 8,669 (3) Radian Base Case Group Types Radian Type Typical bleaching sequence 1 CEH 3 DcEoDED 4 ODEoDD 5 CdEopDD 6 OCdEdD Representative mill defining characteristic U.S. Mills '93 Traditional, no ClO2 on-site 8 High ClO2 substitution; no hypoclorite 11 O2 deliginification high ClO2 subst. 6 Extended cooking; high ClO2 subst. 11 O2 delign. & ext cooking; low ClO2 sub 8 O-DEoDD C(E/H)PD (D&C)EoDED (D&C)EoDED DEDED DEDED CEHD H H S H S H S-H Yes No No No No No No Yes No No No No No No 0 100 60 60 0 0 100 100 0 40 40 100 100 0 No Yes No No No No No No Yes No No No No Yes Yes No No No Yes Yes No No No No No No No No 4 2 3 3 3 3 2 4 1,3 1 1,3 2 3 2 DREopDEpD DEopDEpD O-DcEoDND O-DcEDND DEopDED DcPEoDED DcDED S H-S S H S S H No No Yes Yes No No No No No Yes Yes No No No 0 0 0-50 0-50 0 0-40 0-40 100 100 50-100 50-100 100 60-100 60-100 Yes Yes No No Yes Yes No No No No No No No No Yes Yes On Demand On Demand Yes Sometimes Sometimes No No No No No No No 3 3 4 4 3 3 3 1 1,3 2,4 3,4 2 1 3

NOTES (see appendix for further explanation for classification): (1) Metric ton refers to air dried metric ton of pulp. (2) The defining characteristics of the bleaching sequences are as follows: D Chlorine Dioxide bleaching/delignification E Extraction (caustic soda-NaOH) Eop Oxidative and peroxide extraction H Hypochlorite bleaching N No wash stage, where ordinarily expected O; Eo Oxygen delignification; oxygen extraction ECF Elemental Chlorine Free P; Ep Hydrogen peroxide bleaching; peroxide extraction R Papricycle Z Ozone delignification/bleaching

(4) Paper Task Force Base Case Group Types PTF Type Typical bleaching sequence & Fibe Base case mill defining characteristics 1 DcEDED Softwood 50% chlorine dioxide substitution 2 DcEDED Hardwood 50% chlorine dioxide substitution 3 DcEDED Softwood 50% chlorine dioxide substitution 4 ODEDED Softwood O2 Delignification; 100% chlorine dioxide

Capacity 1000 500 500 1000

V-25 economic competitiveness of new, greenfield 16 mills before we introduce the complexities of retrofitting. Richard Albert (1994a,b), a technical staff manager for the engineering firm Parsons Main has calculated such a comparison (see Table V-6). Each process takes advantage of the chemical cost savings and pollution prevention capabilities of extended delignification. His analysis has shown that the totally chorine and effluent free process (TCF-TEF) has unique cost advantages over the chlorine dioxide-ECF process. The most important of these are: avoided pollution control costs (for effluent treatment), process chemical cost savings and waste recovery. This can result, according to Albert, in an overall cost advantage for TCF-TEF of US$35 per ton of pulp.

TABLE V-6:

Greenfield TCF-TEF Kraft Mill Costs Compared with Chlorine Dioxide-ECF Mill
Capital Costs US$ Millions Operating Costs US$/ton Comparative Cost US$/ton

Analysis and Mill Process

R. Albert, Parson Mains (1994) Totally Chlorine & Effluent Free: TCF-TEF Chlorine Dioxide-Elemental Chlorine Free: ECF TCF-TEF Cost Advantage AET Revisions (Forbes & Manolescu, 1994) Totally Chlorine & Effluent Free TCF-TEF Chlorine Dioxide-Elemental Chlorine Free: ECF TCF-TEF Cost Advantage 623 631 +8 45 40 -5 45 44 +1 585 625 +40 58 72 +14 58 93 +35

Notes: Fiber costs and labor costs not included in operating costs. Comparative costs are calculated to include the differences in capital and maintenance costs on a per ton basis.

The Alliance for Environmental Technology (AET), a group of chlorine and pulp manufacturers, enlisted David Forbes of BE&K, and Don Manolescu of Zerotech

Mills are not called greenfield for environmental qualities, but simply as a way to distinguish new pulp mills from mills undergoing modernization.

16

V-26 Technologies, Ltd (1994), to critique Alberts work. They did not dispute that TCF was competitive with chlorine dioxide technologies, but after making adjustments, they found only a negligible difference between them, considering the uncertainty in engineering estimates. The Paper Task Force (1995a, pg.192; 1995b, page pg.37-38), after evaluating many engineering studies, also concluded that there are essentially no substantial differences in the cost of TCF and chlorine dioxide-ECF production. The economics of retrofitting old mills, such as those in the Great Lakes, presents special problems. The mills are not all alike. Even when they use the same production technology, they may differ in their physical condition or in the type of raw material, leading to different economic and environmental effects. Due to their worn and inflexible equipment, it is difficult for older mills to match the economic performance of a new mill. Nevertheless, such existing mills must replace equipment as it deteriorates, giving them an opportunity to modernize their operations and make them more efficient. The basic choice is to decide between moving toward the ECF design, based on the use of chlorine dioxide and the delignification improvements required by the EPA proposed regulations, or to adopt the state-of-the-art environmental technology, TCF. For the reasons already discussed, this choice will determine whether the mills production of dioxin and other AOX pollutants will merely be reduced, or, in keeping with the principle of pollution prevention, actually eliminated. As a contribution to the development of policy to guide this transition in the Great Lakes mills, we have evaluated the economic consequences of converting them into three alternative forms of ECF and the TCF design: 17  ECF-1: Adapted Traditional Chlorine Dioxide. Adaptation of traditional elemental chlorine mills to chlorine dioxide, with no other substantial changes in delignification or bleaching technology. The conversion trend in the North American industry appears to be toward ECF-1. ECF-2: Modern Chlorine Dioxide. U.S. EPA recommended (in its1993 proposed cluster rules) modern, oxygen delignification (or extended cooking delignification), chlorine dioxide elemental chlorine-free system. This is the most

The economic studies we apply do not include the TCF conversion scenario that has become the norm for modern hardwood mills in the Nordic countries: oxygen delignification; and multiple stages of hydrogen peroxide with chelant stages (Q) (chelation removes metals and optimizes TCF chemical use). This TCF process can be easily adapted to the ECF-2 capital equipment, but with higher chemical usage, and higher chemical costs when high brightness is required. The capital conversion costs from the base case to the to this hydrogen peroxide TCF process is less than for the ECF-2 case for mills that have low pre-existing chlorine dioxide capacity. This option is relatively more expensive for softwood bleaching, but still can be economical: Louisiana Pacifics Samoa, California softwood mill employs this configuration.

17

V-27 common type of retrofitted ECF mill in Europe.  ECF-3: Advanced Low Effluent Chlorine Dioxide. A more advanced low effluent oxygen delignification, ozone bleaching, chlorine dioxide elemental chlorine-free system. The bleach plant effluent can be easily recycled up to the last chlorine dioxide stage. Union Camp, Virginia, has pioneered this ozone technology; Consolidated Papers, Wisconsin Rapids, will be the first mill in the Great Lakes states to install this advanced technology. TCF: Advanced Low Effluent Totally Chlorine Free. Uses identical technology as ECF-3, but with hydrogen peroxide in place of chlorine dioxide. This configuration can be readily converted to a totally effluent free (TEF) mill. There is a stockholders movement at Union Camp demanding conversion to ozone TCF.

In each case we have estimated the change in the cost of pulp production (i.e., in comparison with the existing plants present cost) that would occur if each of the existing Great Lakes mills were converted to the new design. Each scenario maintains the same levels of pulp brightness. (At lower levels of brightness, TCF becomes more cost competitive with ECF. See Govers analysis reported in appendix Table V-A.7.) Economic Data Sources: Radian Corporation and The Paper Task Force. To make our estimates, we have made use of the two most recent independent studies of such pulp process changes. The Radian Corporation (1995) and the Paper Task Force (1995a,c) analyzed alternative investment paths based on typical pulp mill base conditions. These analyses can be advantageously adapted to the Great Lakes mills, for they are based on otherwise unavailable proprietary data on actual mill conditions and provide a common reference point to our own analysis. The Radian Corporation analysis (1995) has many useful features. They develop two chlorine dioxide-ECF scenarios (ECF-2 & ECF-3), which we could easily extend to a third, TCF scenario. They categorized U.S. mills into five groups of types, according to pulp and bleaching process technology. They used proprietary technological and economic data of actual U.S. mills to calculate conversion costs for an existing representative mill of each base case type. Minimal capital expenditures, i.e., for only the equipment necessary for the conversion were used. In contrast, operation and maintenance cost estimates were relatively high, especially for nonchlorine chemicals (e.g. they used a $2.00/kg price for leased ozone, when suppliers quote $1.30 to $1.60/kg). Their results are normalized to a typical mill output of 550 metric ton/ day, which we adjusted for scale relative to the actual sizes of the Great Lakes mills. The Paper Task Force (1995a,c) developed relatively high capital estimates by including in the modernized equipment other pollution prevention measures not always

V-28 required for reducing dioxin generation, but likely to accompany them. One result is that new bleaching chemicals are used more efficiently than they are in the Radian analysis. Separate hardwood and softwood base cases and two output levels (500 and 1000 metric tons/day) are analysed. Only two bleaching technologies -- 50% chlorine dioxide and oxygen delignification with 100% chlorine dioxide (softwood only) -- are analyzed. The latter case, the modern ECF-2, is similar to two mills in the Great Lakes. The Task Force constructed more alternative scenarios than Radian, including two that were useful for our objectives: 1) ECF-1, the current North American industry trajectory of 100% chlorine dioxide substitution with no delignification modernizations, and 2) a high consistency18 ozone stage for ECF-3, which entails a higher capital cost than the medium consistency stage that Radian selected, but which substantially reduces operating costs for TCF. The Cost of Economic Conversion to ECF & TCF. In order to comply with expected future regulations and the international preference for ECF and TCF paper products, the Great Lakes mills will have to undertake one of the capital investment paths outlined above: ECF-1, ECF-2, ECF-3 or TCF. As environmental regulations become more strict, mills will need to adopt the more advanced pollution prevention technologies. We first present, in Table V-7 below, our total capital and weighted average cost estimates of converting the Great Lakes basin kraft and soda mills to each path. Then, in Tables V-8 and V-9 we present these results, separately, for each of the mills.19 The actual conversion costs are likely to be somewhere between the Radian and Paper Task Force estimates. Aggregate (Weighted Average) Costs of Conversion. Table V-7 shows the
18

Consistency, in pulping terminology, refers to the percentage of cellulose fibers in the solution of pulping chemicals. Adaptation of Technical Data to Great Lakes Mills: For the purposes of this study, we assigned each Great Lakes mill to the most similar base case for each of the two approaches. In the case of the Radian approach, we adjusted capital expenditures downward to correct for added investments that were already in place at the Great Lakes mill. We made an additional adjustment to the capital expenditures, for each approach, to account for the quantity of mill output. We used the conventional factor -- Great Lakes mill output/ base mill output raised to the power of 0.6 -- to adjust for economies of scale. Following the advice of the American Forest and Paper Association, we calculated separately the scale of production for each bleach line instead of aggregate output for all lines. We discovered that this increased aggregate capital estimates by 16-20%, as compared with an analysis based on the total aggregate output of each of the mills. Because some capital expenditures will not be duplicated in all the lines, scaling output separately for each of them will overstate actual capital expenses. A TCF scenario was constructed from Radians for capital conversion expenditures for ECF3, which is identical with TCF capital equipment, with an additional $10.49 in operating expenses to account for the increased quantities of hydrogen peroxide needed for TCF. (Based on data from an International Paper Company analysis, Lancaster et al., 1992.) A supplementary discussion of our methodology can be found in the appendix with tables showing the calculations for each mill (Tables VA.4, V-A.5 and V-A.6).
19

V-29 total cost of the capital equipment needed to convert all nine Great Lakes kraft and soda mills to the several ECF and TCF configurations and the annual expenditures that cost represents. Also shown are the weighted averages in annual operating costs (including capital, operating and maintenance costs) per metric ton of pulp. The variation in the change of operating and maintenance costs ranged from an average saving of US$3/metric ton for the ECF-2 mill to an additional cost of US $7 for the medium consistency ozone TCF mill in the Radian application. The largest cost, allocated on a per ton basis, is the capital cost, testifying to the capital intensity of the pulp industry. Estimates of total costs (capital and operation and maintenance) vary from a low of US $6/metric ton for the ECF-2 mill in the Radian approach to US$20 for ECF-3 and TCF mills. The latter amount is about 4.3% of the average production cost of $460 (see box below). After the debt on capital equipment is paid off, the change in ongoing operating cost is at most 1.5% (Radian) and more likely to be even less (Paper Task Force). As shown in Table V-7, the increases in overall production costs -- that is, the increased cost of producing a metric ton of pulp -- range from $4 to $20 among the several types of conversion. These increases need to be viewed against the background of two features of the overall pulp industry: (a) the range of production costs among the mills that the Great Lakes plants must compete with; and (b) the fluctuation in the market price of pulp. First, Sinclair (1991) has reported that the range of production costs among all North American pulp manufacturers in 1988 was U.S.$170 in 1994 dollars per metric ton. 20 Other recent estimates of the range in production costs are between U.S.$35 per metric ton for U.S. plants in 1995 (The Paper Task Force, 1995b, p. 38) and U.S.$85 among four typical Canadian kraft mills (H.A. Simmons, 1992). 21 Clearly, even the largest increase in production costs in converting the nine Great Lakes mills ($20) falls well within the normal range of variation in these costs among competing mills. This suggests that all but the highest cost marginal producers should be capable of coping with even the largest of the conversion costs. Second, the indicated increase in production costs is also small relative to the extra earnings that mills make when the market price rises more rapidly than their production costs. These earnings, as represented by the difference between

Currency conversions and adjustments for inflation are adjusted in this chapter according to the foreign exchange rates and producer price index in Tables 1417 and 760, Statistical Abstract of the United States: 1995, U.S. Commerce Department, Washington D.C. The typical carrying cost of capital expenses (borrowing) of these mills was Canadian $21 $41/metric ton (94 US $18-$35). Note that total capital spending will be higher than these carry-over costs, since additional capital spending comes from retained earnings and other sources of equity.
21

20

V-30 production costs and market price, have at times been more than $350 per metric ton in the last year -- or over 17 times the size of the largest conversion cost. 22 Consequently, the conversion costs need not affect the market price of pulp, except perhaps during periods of oversupply where prices are at their lowest. Thus, in economic terms, the increased cost of converting to ECF or TCF production falls well within the range of variations that are characteristic of the North American pulp market. The capital investments necessary for these conversions of the Great Lakes kraft mills will probably be between US$150-$450 million, or on an annualized pre-tax basis US$20-$60 million. This compares to the Great Lakes mills 1992 estimated total annual capital expenditures of US$250 million (94US$254 million, see Table V-4), which represents $88 per metric ton, and total annual revenue of US$2.6 billion, or $887/metric ton. 23 Thus, the substantial capital investments needed for converting the Great Lakes mills to dioxin-free TCF production appear to be, in aggregate, well within the financial means of the regions industry, provided adequate time is allowed.

The price of bleached softwood market pulp has ranged from an average high of $855 per metric ton ($805 hardwood) in the 2nd quarter of 1995 to a current average quoted price of $505 ($365 hardwood) in the 2nd quarter 1996. Pulp and Paper Week, April 15, 1996. These values are calculated from estimated revenue of each mills product lines and national investment expenditures characteristic of the closest mill type reported in the 1992 U.S. Census of Manufacturers.
23

22

V-31 TABLE V-7: Conversion Costs of Nine Great Lakes Kraft and Soda Mills to ECFand TCF Pulp Production Processes (1994US$)
Capital Expense (Millions of US$) Total Radian Costs Applied
Minimum Capital Estimates

Study Applied to Great Lakes MillsBleaching Process Scenario

Weighted Average Change in Operating Costs per Metric Ton of Pulp (US$) Capital O&M Total

Annual

ECF-1: Adapted Traditional


Chlorine Dioxide-Elemental Chlorine Free

ECF-2: Modern Oxygen Delignification, Chlorine Dioxide-Elemental Chlorine Free ECF-3: Advanced Low Effluent
Oxygen, Medium Consistency Ozone, Chlorine Dioxide-Elemental Chlorine Free

150 225

20 30

+6 +9

-3 -3

+4 +6

TCF: Advanced Low Effluent


Oxygen, Medium Consistency Ozone, Hydrogen Peroxide-Totally Chlorine Free

225

30

+9

+7

+17

Paper Task Force Costs Applied


High Capital Estimates-includes ancillary costs

ECF-1: Adapted Traditional


Chlorine Dioxide-Elemental Chlorine Free

160 285 440

21 38 58

+11 +16 +18

+7 -0 +2

+19 +16 +20

ECF-2: Modern Oxygen Delignification, Chlorine Dioxide-Elemental Chlorine Free ECF-3: Advanced Low Effluent
Oxygen, High Consistency Ozone, Chlorine Dioxide-Elemental Chlorine Free

TCF: Advanced Low Effluent


Oxygen, High Consistency Ozone, Hydrogen Peroxide-Totally Chlorine Free

450

60

+19

+1

+20

Sources: Radian (1995); Paper Task Force (1995b) For full understanding of the power and limitation of this analysis, it is strongly recommended that these original sources be consulted. Notes: Numbers may not add in table due to rounding, see following tables and appendix for calculations and methodology. O&M: Operating and Maintenance cost. Annual: annual expenditures to cover debt, calculated at 10% interest over 15 years; not adjusted for taxes (the Paper Task Force had lower annualized capital costs due to adjustment for taxes). For purposes of comparison with Radian, and the inclusion of Canadian mills with a different tax rate, we omitted tax adjustments.

V-32

Table V-8: Increment in Production Costs per Metric Ton of Pulp (U.S.$1994) for Conversion of Great Lakes Kraft & Soda Mills to ECF and TCF Processes (Radian Analysis Applied)
Output Plant CANADA 1) Avenor 755S 755HS 500S 500H 500S 880S 380H 14 +10 +10 +5 +5 +12 +9 +13 +10 +10 +5 +5 +12 +9 +13 -4 -4 +4 +4 -4 -4 -4 -7 -7 +8 +8 -7 -7 -7 +4 +4 +19 +19 +4 +4 +4 +3 +3 +5 +5 +4 +2 +5 +3 +3 +13 +13 +5 +2 +6 +14 +14 +24 +24 +15 +13 +17
Metric ton/day

Annualized Capital ECF-2 ECF-3 TCF

Operation & Maintenance ECF-2 ECF-3 TCF ECF-2

Total ECF-3 TCF

2) EB Eddy*

+1 +1 +8 +6 +9

3) James Riv 4) KimberlyClark

UNITED STATES 5) Champion* 6) Intl Paper 7) Mead 1040H 880H 790S 960H 90S 400H 230SH +0 +10 +7 +6 +16 +9 +18 +6 +8 +8 +12 +10 +9 +24 +13 +20 +9 +11 +8 +12 +10 +9 +24 +13 +20 +9 +11 0 -4 -4 -4 -4 -4 -4 -3 -3 +8 -6 -7 -7 -7 -7 -1 -3 -6 +19 +5 +5 +4 +4 +4 +9 +7 +5 +0 +6 +2 +2 +12 +5 +14 +6 +4 +12 +6 +3 +2 +17 +6 +19 +6 +5 +22 +16 +13 +13 +27 +17 +29 +17 +16

8) Potlatch

9) SD Warren

Weighted Average
*Without Champion&Eddy

Notes: H: Hardwood; S: Softwood; nc: no change in technological configuration from base case. Numbers may not add in table due to rounding, see appendix for calculations and methodology. *Champion & E.B. Eddy do not fit the base case type, producing misleading/y high operating cost estimates, they fit the Paper Task Force base case for ECF-3 and TCF scenarios much better. References: Radian (1995).

V-33 The Impact of ECF and TCF Conversion on the Individual Mills: Since there are significant differences among the existing designs and operations of the nine Great Lakes kraft and soda mills, the conversion process will represent different advantages and problems as well. Below, we summarize some of the specific effects on conversion on the individual mills. Conversion of Modern Bleach Lines with Oxygen Delignification: Champion International and E.B. Eddy: These two mills are the most modern kraft pulp mills in the Great Lakes Basin and cost the least to convert to TCF: only $6-$8 per metric ton, with no significant differences in operating cost, according to our application of the Paper Task Force analysis.24 They are likely to realize additional chemical cost savings from modifications already made to their digesters for extended cooking. E.B. Eddy may require expanded investments in chlorine dioxide capacity to operate ECF on a permanent basis, making the low effluent ozone ECF-3 and TCF more attractive and timely. Indeed, E.B. Eddy has a pilot ozone plant and is considering implementing ozone on a mill scale. 25 These two mills have the competitive advantage that Nehrt (1993, 1995) discovered to be keys to market share and profitablilty: early development and adaptation of advanced technology. They are also in the best situation to implement advanced TCF pollution prevention technologies. Conversion of Bleach Plants with Partial Chlorine Dioxide Substitution: Kimberly Clark and Mead. These bleach lines represent an intermediate dioxin reduction step, with a small commitment to chlorine dioxide use arising from recent limited investments. As we can see from Table V-9, converting the softwood lines to advanced low effluent TCF has a small total average cost advantage ($1-$2) over permanent 100% chlorine dioxide-ECF-1. What is more important in the long run, especially after the debt is paid off, is that there is a large operating cost advantage for TCF softwood conversions ($11 per metric ton). This shows that for the large softwood kraft mill, the larger initial capital expenditures for TCF technology is offset by economies of scale and more than compensated by savings in operation, providing a strong competitive

The Radian analysis, did not have an appropriate base case for this configuration, so it overstates costs in the ECF-3 and TCF scenarios. The Paper Task Force base case is for a softwood mill: the capital costs should be similar for the hardwood lines, but the bleaching chemical usage is lower for hardwood, so chemical cost differences may be different than those predicted by our adaptation. Champion Internationals corporate planning has taken a different tack, the development of a chlorine dioxide-elementally chlorine and effluent free process (ECF-TEF). But a low effluent TCF mill would be more economical for Champions Quinessec, Michigan mill: ECF-TEF has higher capital costs ($7 per metric ton) and operating costs ($6-$8 per metric ton) (adapted from Paper Task Force 1995b, pp. 39-42).
25

24

V-34

Table V-9: Increment in Production Costs per Metric Ton of Pulp (U.S.$1994) for Conversion of Great Lakes Kraft & Soda Mills to ECF and TCF Processes (Paper Task Force Analysis Applied)
Output Plant
Metric ton/day

Annualized Capital
ECF1 ECF2 ECF3 TCF

Operation & Maintenance


ECF1 ECF2 ECF3 TCF ECF1

Total
ECF2 ECF3 TCF

CANADA 1) Avenor 755S 755HS 500S 500H nc nc +18* +18* nc +11 +14 30 +21 +21 +7 +7 +26 +20 +29 +22 +22 +8 +8 +27 +20 +29 nc nc +9* +6* nc +9 +6 -2 +2 nc nc -2 -2 +2 -2 +6 +1 +1 -1 -2 +6 -2 +4 +0 +0 -2 -2 +4 nc nc +22* +19* nc +20 +20 28 +19 +26 +8 +8 +24 +18 +34 45

2) EB Eddy

nc nc +18 +14 +20

nc nc +16 +11 +22

+8 +8 +25 +18 +33

3) James Riv 500S 4) KimberlyClark 880S 380H

UNITED STATES 5) Champion 1040H 6) Intl Paper 7) Mead 880H 790S 960H 90S 400H nc +10 +12 +9 nc nc +18 +11 nc +14 +14 +13 +36 +20 +25 +16 +5 +19 +20 +19 +51 +28 +35 +18 +6 +19 +20 +19 +52 +29 +36 +19 nc +6 +9 +6 nc nc +9 +7 nc +2 -2 +2 -2 +2 -2 -0 +1 +6 -2 +6 -1 +6 -1 +2 +0 +4 -2 +4 -2 +4 -2 +1 nc +16 +20 +16 nc nc +27 +19 nc +15 +12 +15 +34 +22 +23 +16 +6 +25 +19 +25 +50 +34 +34 +20 +6 +23 +19 +23 84

8) Potlatch

9) SD Warren 230SH Weighted Average


excluding nc mills

+35 +20

Notes: H: Hardwood; S: Softwood; nc: no change from base case, already in similar technological configuration. Numbers do not always add due to rounding, see appendix for calculations and methodology. *E.B. Eddy, does not fit the conversion case for ECF-1 well: it has advanced delignification technology, but does not operate at full chlorine dioxide substitution. References: Paper Task Force (1995b).

V-35 advantage over the traditional ECF-1 path. The ECF-2 configuration is, however, the least expensive conversion due to capital expenditures that amount to $6 less per metric ton, so a regulatory or market incentive is nevertheless needed to realize the environmental gains of low effluent TCF. In contrast, the hardwood lines do not enjoy the operating cost advantages (only $2 per metric ton) that would compensate for the higher capital costs of the more advanced technologies. TCF has an overall $7 disadvantage for Meads line and a $13 disadvantage for Kimberly Clarks smaller line, which does not benefit from economies of scale. The hardwood lines are in a different situation because they use less bleaching chemicals in the first place (due to lower lignin content) and therefore have less operational costs to economize through increased capital substitution. These hardwood bleach plants, especially Kimberly Clarks smaller line, may find that conversion to the less capital intensive chlorine dioxide ECF-2 configuration a more economical route to TCF conversion. A strong TCF market incentive could overcome these TCF hardwood handicaps. Hardwood market pulp is priced $50-$100 lower than softwood due to its shorter fibers. Even with a TCF premium price, hardwood pulp could be more inexpensive than softwood ECF pulp. Conversion of Traditional Bleach Lines Adapted to Chlorine Dioxide-ECF-1: Avenor, James River, and Potlatch. Unlike investments in TCF technologies, these mills recent investments in 100% chlorine dioxide substitution-ECF-1 provides them with no economic advantage for adopting the more modern pollution prevention technologies. They face essentially the same modernization costs as mills with partial chlorine dioxide substitution, but face an additional handicap -- the debt burden from past chlorine dioxide invesments, which become redundant with modern bleach chemical economizing technologies. Consequently, these mills will be the most resistant to the adoption of TCF technologies until they fully recover their recent chlorine dioxide investments. The Potlatch mill is in a different situation than the Avenor and James River mills. Its recent investments in additional chlorine dioxide generation are part of a comprehensive plan to expand its softwood line and convert the first chlorine dioxide stage to oxygen delignification (i.e., the modern ECF-2 configuration). While their recent investments in chlorine dioxide will not become redundant in the larger ECF-2 line, the additional chlorine dioxide would not be necessary in a plan to adopt the more advanced low effluent ECF-3 or TCF technologies. (The issues of converting Potlatchs and other small bleach lines will be discussed further below.) Conversion of a Hardwood Soda Mill: International Paper. This mill is only one of two mills in the United States that bleaches soda hardwood pulp; directly applicable economic conversion data are not available. Our analyses should be relatively accurate for capital expenses, but less so for operating expenses, since soda

V-36 mills pulp requires even less bleaching chemicals than the typical hardwood mill. 26 Consequently, this mill may face the same high cost of conversion to TCF as Mead and Avenors large hardwood lines. However, TCF conversion would be less costly for International Paper than for Mead and Avenors kraft mills, since TCF bleaching costs should be relatively lower. International Paper has taken one step toward TCF: it is the only one of the Great Lakes mills with a full hydrogen peroxide bleaching stage. Conversion of Small Bleach Lines: S.D. Warren (Scott) and Potlatch. The greatest capital barriers to conversion toward the low effluent ECF-3 and TCF technology occurs in small bleach lines, which have diseconomies of scale: capital improvements cost more, on a per ton basis, than for larger mills. Thus, TCF conversion of S.D. Warrens 230 metric ton per day mill would cost $35 per metric ton compared to $23 per metric ton for the less capital intensive ECF-2. TCF conversion of Potlatchs 90 metric ton per day softwood line would result in a prohibitive $50 per metric ton cost increase compared to $34 for ECF-2. The best route in this situation is to expand capacity when modernizing to take advantage of economic returns to scale, 27 as Potlatch plans to do. In some cases, it may be more economically and environmentally advantageous for the Great Lakes region to consolidate the production of small bleach lines to fewer locations. Since fiber supply is a crucial limiting factor for pulp output in the Great Lakes region, any existing fiber supply that becomes available in the region from a small mill shutdown will probably be picked up by other mills in the region.28 Implementation; Economically Feasible Paths. Since pollution prevention technology replaces existing technology, the economic problem is a matter of scheduling financial investment. For any mill to survive and provide economic returns in the long run, it must have a modernization strategy. To do so, company engineers and executives must forecast what technologies will be needed in order to be competitive and to meet societys environmental goals. Once these goals are clear, a technological investment path and schedule can be established. As we have shown, TCF-TEF technology is cost-effective for a modern mill and is therefore a reasonable

Soda mills produce a lighter pulp than kraft mills because they do not use sulfides which darken residual lignin during the kraft cooking process. Their advantage is lower bleaching costs. Soda pulping is not as effective in delignification as the kraft process, so is less strong and commands a lower market price. 27 An additional option for the small mills is to convert to recycled fiber or non-wood fibers like agricultural waste, abundant in the Great Lakes region. These options are more economical to bleach TCF and do not require the same high scale of production as kraft. S.D. Warrens tissue product line is particular amenable to recycled fiber (refer to the following deinking recycled mill section). U.S. EPAs recent impact analysis (November 1993, section 5) simply equates mill closure due to an environmental regulation as a loss of output, resulting in seriously over-projecting losses in national output.
28

26

V-37

Why other studies TCF pollution prevention cost estimates appear prohibitively high:

Earlier ECF & TCF Conversion Studies: The studies by McCubbin, et al. (1992), Lancaster, et.al., International Paper (1992) and H.A. Simons Ltd. (1992) deserve special mention. While some TCF technologies were known in 1992, they were not adopted at the scale and range of conditions that they are today. As a result, the above 1992 studies seriously overestimated expenditures. The following three examples demonstrate these shortcomings:
1) Since 1992, it has been known that the addition of anthraquinone can substitute for extensive capital outlays in extended cooking, and still produce a viable TCF pulp. Some of the 1992 studies cited above advocated complete replacement of the pulp digesters with the new modern extended cookers ($36.4-$51.5 million; Paper Task Force, 1995b, p.53). New digester equipment can optimize the use of TCF bleaching chemicals, but there is no need to immediately install them. 2) Some analyses have added the cost of a new recovery boiler to TCF estimates ($84.4 million, Paper Task Force, 1995b, p.27; Lancaster et al., International Paper, 1992). Many recovery boilers have excess capacity (3 out of 4 of the Great Lake Ontario mills have excess capacity). Many of those at full capacity can be modified and expanded, at costs that the Paper Task Force estimated. A Weyerhauser study (Patrick, et al., 1994; Paper Task Force, 1995b, p.28) found that most United States mills recovery boilers will need to be rebuilt or replaced in any event in the next decade, due to their age; they are over 30 years old. In any case, normal replacement will include expanded capacity, since it is required of modernizing toward either process, TCF or ECF. 3) Since 1992, non-chlorine chemical usage has been optimized in TCF mills. Practical mill experience has fine-tuned the bleaching process and optimized TCF pulp quality and yield.

economic goal for the modernization of older mills. Moreover, for most mills in the Great Lakes, there exists a feasible investment path. For some of these mills ECF-2 and ECF-3 may be an appropriate intermediate step to adopting TCF-TEF processes. ECF-1 is not an appropriate intermediate. The smaller bleach lines will have the most difficulty and competitive problems, regardless of what minimal environmental objectives are implemented. Modernization, at least in current practice, appears to generally result in reduced employment relative to output. That the conversion scenarios explored here may entail increasing the capital intensity and reduced employment is in keeping with the effect of recent modernization and productivity improvements on employment. (The U.S. Bureau of Labor Statistics (1994) predicts a 6.4% employment loss from 1992-2005.) If

V-38 these declines are strictly proportional to capital investment, then the several conversion paths would have the following impact on employment and payroll (in 1992 U.S.$): traditional ECF-1, loss of 37 jobs and a $1.6 million payroll; modern ECF-2, a loss of 34 to 69 jobs and a $1.5 to $3 million payroll; advanced low effluent ECF-3 and TCF, loss of 52 to 106 jobs and a $2.3-4.6 million payroll. Actual job losses may be more attributable to investments in automation than to the environmentally motivated technological conversions. The economic feasibility of conversion to TCF has in fact been demonstrated in practice: TCF plants have been built and operate successfully. As shown in Table V14 below, there are now 47 TCF pulp mills operating in Europe, and seven in Canada. 29 There are only two TCF mills in the United States at present, a kraft mill operated by the Louisiana-Pacific Company in Samoa, CA, and a sulfite mill operated by Lyons Falls Pulp & Paper in Lyons Falls, NY. Their experiences are informative. Louisiana-Pacific's Samoa kraft pulp mill, like many TCF mills in Europe, began converting to TCF as a means of reducing a number of pollution problems caused by the use of elemental chlorine. Conversion began on an experimental basis in 1991 and was completed in 1994, one year ahead of schedule. The plant is now able to achieve brightness of over 85 ISO with strength equivalent to that of chlorinated pulp (chlorine bleaching generally achieves a brightness of 90 ISO). Louisiana-Pacific has found a strong market for its TCF pulp in Europe, where it has commanded a premium price of up to $50 per metric ton (Louisiana Pacific, 1995). The Samoa plant has already diverted some of its effluent into closed-loop recycling systems, a step that may have contributed to the economic success of its conversion. The Lyons Falls sulfite mill is another example of an economically successful U.S. conversion to TCF. One of its chief products is paper for book publishing. The company has actively promoted the use of TCF paper to publishers and now supplies several with paper for books that often bear a TCF logo. The United States experience, however limited, indicates that TCF production is economically viable. Many North American pulp mills cite environmental problems as contributing factors to mill abandonment that could be solved with the closed loop technologies that become possible as TCF is adopted. Ultimately, closed loop technologies promise to reduce the costs of TCF pulp to that of ECF pulp, or less. To reach that goal, TCF needs the proper market incentives and regulatory signals in order to evolve and become internationally competitive. This aspect of the problem is discussed in section F below. b. Deinking pulp mills:
Most of the Canadian TCF mills do not produce TCF on a permanent basis, but intermittently, in response to its European customers. These mills have not optimized their production equipment for TCF use, but use a combination of chemicals (e.g. anthraquinone and enzymes) to keep production costs down.
29

V-39 1) Technology and environmental impact: Of the 20 Great Lakes pulp and paper mills that use chlorine compounds and discharge effluent into the Great Lakes or their tributaries, 10 are solely devoted to the production of recycled paper. They employ about 4,800 employees, have a payroll of $203 million, and shipments of $1.3 billion (see Table V-4). Technology: Since these plants manufacture pulp and paper directly from paper rather than wood, the manufacturing process is complicated by the removal of various impurities -- e.g., inks, fillers, coatings, and stickies -- but in other respects entails less capital and operating costs. Chemical cooking is unnecessary; only water and agitation are needed to mash waste paper into pulp. Reagents are added to release the ink and other impurities from the paper fiber; these particles are then separated from the pulp, for example by flotation, and collected as a waste sludge. For some products the deinked pulp may need additional brightening. Since many wastepaper grades have been previously bleached, they require less bleaching than their virgin counterparts. Nine Great Lakes deinking plants presently use chlorine or hypochlorite as bleaching agents, and in one plant, reportedly as an agent to improve disposal in sewer systems. Bleaching chemicals have little effect on inks, but they do reduce the color of dyes, impurities, or yellowed lignin, brightening the pulp. Dioxin Formation: Because it contains less lignin than virgin pulp, chlorine or hypochlorite is needed to bleach deinked pulp made from previously bleached waste paper. It follows that there is also less likelihood that dioxin will be synthesized in the bleaching of deinked pulp. Nevertheless, there is evidence that chlorine bleaching of recycled pulp does generate some dioxin. This is shown by the fact that samples of recycled paper produced by mills that use chlorine bleaching typically have a higher dioxin content than the virgin paper (Beck et al. 1988; Rotard et al., 1990; Fiedler & Timms 1990; Rappe et al. 1990; Santl et al. 1994). When the wastepaper has a relatively high lignin content -- as in the case of unbleached paper or wastepaper made from mechanical pulp -- chlorine bleaching is likely to produce higher levels of dioxin. This view is supported by the U.S. EPAs (October 1993, pg 7-9, 7-44) evaluation of a survey of 23 recycled paper deinking mills and 6 recycled paper nondeinking mills. They found that chlorine bleaching of recycled pulp produced chlorinated organic wastes similar to those produced at virgin chemical pulp bleach plants, but generally at much lower levels. In their 1989 one mill study, the U.S. EPA found a relatively high dioxin content in the wastepaper inputs, indicating that much of the dioxin in the sludge and bleach plant effluent originated from the wastepaper. U.S. EPA surmised that dioxin might have been formed in the chlorine bleaching of the virgin paper or resulted from fallout of dioxins from the atmosphere, that settled on the wastepaper. (See also Berry, 1993 and Rappe, et al. 1990.) Research in Germany has revealed other sources of waste paper dioxin: certain inks have high dioxin

V-40 concentrations with a pattern of different congeners (dioxin fingerprints) consistent with that found in wastepaper; tall oil rosin sizing agents used in paper production and wastepaper contaminated with pentachlorophenol (PCP) might be responsible as well (Santl, Gruber and Sthrer, 1994a,b). In the absence of chlorine-based bleaching the recycling process itself does not appear to contribute significantly to the dioxin problem (Santl et al., 1994). More than 90% of the dioxin in the input of a non-bleaching recycled paper mill was accounted for by the dioxin content of the waste paper; sizing agents accounted for the rest. The dioxin content of the recycled paper pulp was a third of the dioxin content of the waste paper used to manufacture it. NCASI has provided us with unpublished data regarding the dioxin content of hypochlorite bleached and unbleached recycled pulp. The overall results are ambiguous and do not appear to establish that bleaching is entirely free of dioxin formation.30 In view of this uncertainty, it is prudent to consider non-chlorine bleaching alternatives, which will not compound the problem of dioxin formation. 2) Alternatives to chlorine-based bleaching: Most recycled paper plants bleach in one- or two-stage bleaching with hypochlorite. For higher brightness a chlorine stage followed by a hypochlorite stage may be used. Hypochlorite efficiently strips the color from dyed paper and brightens the final paper product. Apart from pollution problems, one of the reasons for eliminating the use of hypochlorite for bleaching recycled pulp is that non-chlorine alternatives can produce brighter paper from mixed waste paper. As recycling production capacity has expanded the availability of high grade wastepaper has become more limited. This has encouraged many mills to use more flexible chemical bleaching technology. The most easily substituted chemicals are: hydrogen peroxide, sodium hydrosulfite, and formamidine sulfinic acid (FAS). They are used to produce process chlorine-free (PCF) pulp. Recently, firms interested in achieving a high level of brightness have taken advantage of this opportunity. For example, Kieffer Paper Mills chlorine-free bleached deinking mill has achieved 88% ISO 31 brightness recycled

A thorough mass balance needs to be done to account for all of the dioxin going into and out of the bleach plant system. It is important that these studies are done for the mills that use chlorine compounds to bleach lower grade high lignin content papers into higher paper grades, an increasingly common practice. ISO and GE are the names for two different scales used by the pulp and paper industry to measure the brightness of their market pulp and paper products. ISO is the more commonly used scale of measurement today; the GE scale is still used by many deinking mills to measure the brightness of deinked pulp.
31

30

V-41 pulp, higher than that typically achieved by chlorine bleaching (Paper Age July 1995). They are experimenting with a third non-chlorine bleaching stage to reach a 91.5% ISO level of brightness. 3) The Economic Aspects: The substitution of non-chlorine-based bleaching agents, such as sodium hydrosulfite or hydrogen peroxide, for chlorine-based agents in recycled pulp plants can involve little or no new equipment. Since most non-chlorine bleach chemicals do not need to be generated on-site (as do hypochlorite and chlorine dioxide), the necessary capital investment is negligible. The pre-existing pulping and bleaching equipment generally need only minor modifications, which may range from zero to $225,000 in cost (Radian 1995). As a result, the cost differential between the alternative bleaching strategies is influenced by the relative costs of the agents themselves. Sodium hypochlorite costs about half as much as sodium hydrosulfite or hydrogen peroxide (see Table V-10). On the other hand, there are significant economic advantages to the use of non-chlorine-based bleaching agents. In many conditions they can produce a higher level of brightness in the final product -- a property that can enhance its selling price. Non-chlorine-based alternatives also allow the use of less expensive woodcontaining fiber (high lignin content furnish) because -- unlike hypochlorite -- they do not cause the yellowing of lignin. Thus, the use of hydrosulfite in place of hypochlorite enables a recycled pulp mill to replace some of the wood-free furnish costing from $120-$215 per ton (colored ledger to computer printout) with wood-containing furnish from $5-$55 per ton (mixed paper to old newspapers). 32 Based on these considerations, we have assembled data on several alternative ways of bleaching recycled pulp in order to estimate the relative costs of manufacturing it with sodium hypochlorite bleach or sodium hydrosulfite/hydrogen peroxide bleach to produce tissue-grade pulp with a target brightness of 80% (GE). The results are shown in Table V-10, which compares the production costs and brightness achieved in the various processes. When the process uses only wood-free 33 furnish and is chlorinefree (PCF), the cost of production is about $4.60 more per ton than the cost of a comparable, chlorine-based process. This represents only 2% of material costs and less than 1% of the price of deinked bleached market pulp (according to Paper Age,

These are Chicago price quotes for November-December 1995 from Pulp & Paper Week. Prices and supply are volatile, but there are consistent price premiums for woodfree wastepaper grades.
33

32

Freesheet or woodfree refer to paper that contains no mechanical pulp fibers.

V-42

Table V-10 Deinking Bleaching: Hypochlorite vs. Process Chlorine Free


Cost Comparisons with Woodfree and Mixed Wastepaper Target 80% Brightness (GE) Tissue Grade Recycled Pulp Wastepaper Furnish & Bleaching Chemicals
Woodfree Wastepaper Hypochlorite Bleaching Woodfree Coated Book Furnish Sodium Hypochlorite Sodium Hydroxide Total Chem ical & Furnish Costs Brightness Hydrosulfite Bleaching (PCF) Wood-Free Coated Book Furnish Sodium Hydrosulfite Sodium Hydroxide Total Chem ical & Furnish Costs Brightness Mixed Wastepaper Hypochlorite Bleaching Woodfree Coated Book Groundw ood (Old New spapers) Sodium Hydroxide Sodium Hypochlorite Total Chem ical & Furnish Costs Brightness Hydrosulfite/Peroxide Bleaching (PCF) Woodfree Coated Book Groundw ood (Old New spapers) Sodium Hydroxide Hydrogen Peroxide Sodium Hydrosulfite Total Chem ical & Furnish Costs Brightness 70.0 30.0 1.0 0.5 0.7 0.3 20 10 ton ton lbs lbs 48.78 8.25 6.40 2.50 65.93 87.50 9.00 2.80 2.50 101.8 72.2 70.0 30.0 1.0 0.5 0.5 0.7 0.3 20 10 10 ton ton lbs lbs lbs 48.78 8.25 6.40 6.85 7.10 77.38 87.50 9.00 2.80 3.80 7.10 110.2 81.0 100.0 0.5 1.0 1 ton 10 lbs 20 lbs 69.69 2.50 6.40 78.59 125.00 2.50 2.80 130.30 80.9 100.0 0.5 1.0 1 ton 10 lbs 20 lbs 69.69 7.10 6.40 83.19 125.00 7.10 2.80 134.9 82.8 % ton Quantity @100% Cost Cost Brightness % GE

US$ 1992 US$ 1995

Sources: Adapted from Timothy E.McKinney, "Alternative Chemicals Gain Popularity for Bleaching Woodfree Furnishes," Pulp & Paper March 1992 Chemical Marketing Reporter 1992-1995 did not show any differences in list prices for these bleaching chemicals. Contracted prices are lower and vary by sale and location. Price estimates for sodium hydroxide (13c/lb) and hydrogen peroxide (38c/lb) are those reported by Forbes and Manolescu (September 1994). 1995 waste paper prices were those reported by Paper Recycler for Chicago seller's f.o.b. in December.

V-43 July 1995, $540/ton). However, when the chlorine-free process makes use of cheaper furnish -- i.e., wood-containing wastepaper such as old newspaper -- as a substitute for 30% of the wood-free furnish, then chlorine-free production of bleached wood-free pulp at a brightness of 80% GE costs about $20 less per ton than hypochlorite-based production. According to industry sources, PCF production costs for tissue products may increase up to $10 per ton if higher brightness is required. Thus, conversion of many of the Great Lakes basin deinking pulp mills to process chlorine-free (PCF) operation 34 can be done by simply substituting non-chlorine bleaching chemicals -- hydrogen peroxide, hydrosulfite or FAS -- for chlorine-based bleaching compounds such as chlorine, hypochlorite or chlorine dioxide. Oxygen or ozone bleaching may also be substituted for chlorine bleaching especially for brighter paper grades or certain types of wastepaper 35, but may entail additional capital outlays for an ozone generator and an oxygen bleaching tower. Since the outcome of conversion to PCF may be slightly higher costs or less bright product, increased public awareness of the environmental benefits may compensate in the marketplace for these disadvantages. The development of TCF and PCF product markets is discussed in section E below. Conversion to PCF should not affect employment, payroll or sales. Some firms might incur slightly higher operating costs and slightly smaller profit margins, and would therefore resist conversion. All but one of the deinking mills surveyed by CBNS predicted no significant losses of employment due to environmental improvements. One mill reported that environmental improvements added 15-20 jobs. Another mill said that environmental improvements substantially reduced employee turnover. One mill said that it was conceivable that the proposed U.S. EPA cluster rules and Great Lakes Initiatives could result in mill closure. (It is interesting to note that this company had closed a hypochlorite bleaching deinking mill, which was successfully converted to a PCF mill by its successor.) Any possible declines in employment will be more than offset by the increased job opportunities generated by the expansion and new construction of deinking mills. Deinking capacity is expected to triple, as American paper companies have recently invested $7.5 billion in recycling capacity and plan to invest another $10 billion in the next five years. The limiting factor appears to be wastepaper supply, not the relatively small cost of bleaching recycled fiber. Conclusion: An examination of 1994-1995 Pulp & Paper Project newsletters

Process Chlorine Free (PCF) does not necessarily result in Totally Chlorine Free (TCF) pulp and paper, because in recycling, waste paper often contains chlorine and organochlorines, such as dioxin, from the original chlorine manufacturing processes or inks. Since the price of high-grade bleached wastepaper has gone up and availability down, recycled paper mills are beginning to use unbleached wastepaper with significant amounts of lignin that needs to be delignified for certain paper products (see Haywood, Pulp& Paper, Feb. 1995). Old Corrugated Cardboard (OCC) can also be substituted for virgin fiber in a TCF kraft mill to produce highgrade papers of up to 87 ISO (Pichler et al., 1995).
35

34

V-44 that report new planned bleached deink mills failed to identify any mill planning to use hypochlorite or chlorine. The Paper Task Force (1995a) forecast PCF for all new deinking mills and expected older mills to convert. Georgia-Pacific in Kalamazoo, Michigan, which bleaches 400 tons per day of deinked pulp recently converted their bleaching process from hypochlorite/hydrosulfite to hydrogen peroxide/hydrosulfite, and is now PCF (Lockwood Post 1995). Ponderosa has recently converted a mill to ozone bleaching of deinked market pulp. They are exploring the possibility of converting their Great Lakes mill to ozone or another PCF process.The trend in new U.S. facilities is toward totally chlorine-free production. For example, a new mill scheduled for completion this year in Michigan, Great Lakes Pulp and Fibre, will produce 715 tons per day of PCF deinked market pulp -- will reportedly be the largest plant in the world for deinking fine papers, according to the 1995 Lockwood-Post's Directory. Thus, there is practical evidence that both the construction of new PCF recycled pulp mills and the conversion of existing mills to PCF process is technologically and economically feasible. Nevertheless, this trend would be increased by government action. In particular, clear identification of PCF products and government regulatory and procurement policies that favor PCF would have a significant effect on conversion. 36 c. Sulfite pulp mills: There is one sulfite mill in the Great Lakes water basin -- Badger Paper -- which contributes dioxins to the Great Lakes. Badger, an integrated pulp and paper mill, has about $65 million in revenue and employs over 200 people. The bleaching process, chlorine-extraction-hypochlorite (CEH), is unchanged since the 1988 104 mill study, when its effluent dioxin samples ranged from 0.013 to 0.182 g TEQ per year (calculated from values reported in TetraTech, 1990). NCASI has indicated that they will release an estimated 0.0041 g TEQ/yr (medium) in 1993, based on self-reported data. We have not been given any indication of how this reported decline could have occurred with the continued use of 100% elemental chlorine in the first stage and hypochlorite in the last bleaching stage. Like most sulfite mills in North America, Badger is relatively old; it was founded in 1929. The mill cooks with sulfurous acid instead of the sulfate-caustic soda solution used in the kraft process. This process produces brighter pulp at higher yield but which is less strong than kraft pulp. It requires less bleaching than kraft pulp, since sulfurous acid darkens pulp less than sulfate does. It appears that considerable research and development would be needed to modernize Badger Paper. The relatively small size of Badger Paper makes it unlikely that substantial capital investment will be made, unless capacity were to expand and its

It is possible that Great Lakes chlorine dioxide bleached kraft mills would bleach secondary fiber with chlorine dioxide if they should develop secondary fiber sources and pulping capacity.

36

V-45 wood fiber source capitalized. Badger Paper is in a difficult position; according to corporate reports, it has not been doing well financially. Rather than invest in modernization of its existing mill, it recently acquired another mill, which it couldnt afford to keep and later had to sell. Indeed, Badger Paper company has announced the shutdown of their sulfite pulping operations in April 1996, citing that the variable costs of its sulfite pulp were higher than the pulp it could purchase on the market. They also mentioned the prohibitive expense of meeting the expected environmental guidelines. This phenonomen is typical of many North American paper companies. When they are in a position to expand sales, they tend to favor acquisitions over modernizing expansions or building a new mill. This approach often requires less capital, but does not economize on operating costs, which are minimized through modernization. The result is often high debt, with no new capital equipment to show for it, or higher productivity which could enable the company to survive a downturn. Unlike European sulfite mills, most sulfite mills in North America have not modernized.This may be a contibuting factor to their demise; from 1980 to 1990, 60%of the sulfite mills in the United States closed. In constrast, Lyons Falls New York sulfite mill, like many such mills in Europe, has used TCF conversion as a successful strategy for modernization and survival. E. Product Marketing and Demand: The preceding analyses provide us with information about the economic feasibility of modifications in pulp production technology that can achieve the virtual elimination of dioxin (and of similar organochlorine pollutants). In the manufacture of virgin kraft pulp, the growing application of bleaching sequences based on the substitution of chlorine dioxide for chlorine (ECF) have significantly reduced the levels of dioxin, and of organochlorine pollutants generally, in the plant effluents. Nevertheless, the use of chlorine dioxide always releases a small amount of chlorine, which, reacting with residual lignin, produces dioxin and other organochlorine pollutants. Hence, ECF plants are not in fact entirely chlorine-free, dioxin-free or organochlorine (AOX) pollutant-free. On the other hand, the available evidence shows that neither dioxin nor AOX is produced by the TCF bleaching process, which, in that sense, is both dioxin-free and AOX-free. It is fair to say, therefore, that although ECF mills are a considerable environmental improvement over elemental chlorine-based mills, it is only the TCF process that has achieved the goal of eliminating the dioxin that the production of nonTCF bleached pulp imposes on the environment. TCF also enjoys another environmental advantage over ECF: unlike ECF plants, TCF plants can be much more readily converted to an effluent-free status by recycling their effluents in closed-loop systems -- thus totally eliminating all waterborne pollutants and recapturing fuel and process chemicals.

V-46 In sum, as a matter of policy, the goal of virtually eliminating the entry of dioxin and similar organochlorine pollutants into the Great Lakes from the pulp and paper industry ought to be implemented by converting the industry to TCF operations and, in the case of deinking recycling mills, to process chlorine-free (PCF) operation. There is, however, an important economic barrier to the implementation of this environmentally motivated policy: TCF pulp is at present more costly for existing mills to produce than ECF pulp. This raises the question of whether TCF pulp and paper can command a correspondingly higher price and thereby motivate the necessary investment in the process. In turn, this issue depends on the demand for TCF paper. The products manufactured by the 20 Great Lakes region pulp and paper mills include: printing papers, fine or writing papers, packaging and industrial converting papers, market pulp and tissue. The major Great Lakes products are coated papers, tissue, and market pulp. Together these three categories account for over threequarters of the mills revenue. The Great Lakes mills account for about 30% of the North American production of coated papers, which are used in a wide range of business and consumer products where high-quality printing is important: magazines, business publications, annual reports, and advertising. These are items with considerable public visibility and therefore particularly sensitive to consumer demand and government procurement preference for recycled and chlorine-free paper. The Great Lakes mills are also significant producers of tissue products, with an estimated 17% of the combined Canadian and U.S. production. The tissue products produced by these mills -- which are all made from recycled deinked pulp -- include napkins, table covers, as well as toilet paper, towels, sanitary and other tissues. Unlike high-grade printing paper, these end-uses often do not require high brightness. Market pulp is produced for sale to paper mills in open competition with other international pulp producers. The market pulp production capacity is concentrated in the regions Canadian facilities. Most Canadian market pulp (59%) is shipped outside of North America; 31% is shipped to the U.S.; and 10% to paper companies in Canada (Pulp & Paper North American Fact Book, 1993, p. 301). There is a rather close relationship between the supply of the several types of commodities produced by the Great Lakes mills and the estimated regional demand for them (defined as the demand arising from the eight Great Lakes states and the Province of Ontario). This is shown in Table V-11. The demand for paper products in the region arises principally from magazine, catalogue and other commercial printers (for coated freesheet), book publishers and printers and other commercial printers (for uncoated freesheet), government agencies (for uncoated freesheet and tissues), and households (for tissues). The largest demand arises from the printing and publishing industry, which is relatively concentrated in the region. The U.S. firms in the regional printing and publishing industry comprise almost 50% of the total U.S. industry in terms of value of shipments. (See Table V-12) Similarly, Ontario firms account for about one-

V-47 half of Canadas printing and publishing industry (Manufacturing Industries of Canada, Statistics Canada, 1991-92). Table V-11 shows that the existing regional demand is more than sufficient to absorb the regional supply of the major Great Lakes paper products.

It follows, then, that a policy directed at increasing the regional demand for TCF products could have a significant impact on the regions suppliers, in the sense of justifying their investment in the transition to TCF. The printing and publishing industry is already playing a key role in this transition. Recent purchasers of TCF pulp and paper in the United States include book publishers; state and Federal government agencies;37 a Midwestern pulp converter manufacturing food-wrap papers38; non-profit environmental organizations (National Wildlife Federation and Environmental Defense Fund); magazines (e.g., Scuba Times), and fast-food chains such as McDonalds, which uses TCF in french fry bags. Jossey-Bass Inc., a California-based publisher (a subsidiary of Simon & Schuster), has worked extensively to define environmentally responsible publishing practices, and is the first U.S. trade publisher to use TCF paper (Bruner, 1995). Jossey-Bass began using TCF uncoated paper for printing books in 1994, and after finding the price and quality acceptable, is using TCF stock for the majority of the companys titles. The company prints about 140 new book titles, several hundred reprint titles, and about 90 journals annually (Bruner, 1995). Additionally, the University of California Press, one of the largest university presses in the United States, will soon convert a portion of their printing to TCF papers. By 1997 they expect to use TCF paper stock for about 50% of their new titles and book reprints. 39 Most of the manufacturers contracted to print books for the University of California Press are

Conversation with Mark Floegel, of Greenpeace, Oct. 13, 1995. Government agencies included State of Massachusetts and the U.S. General Services Administration. Conversation with Pat Wendell, of MoDoCell, Oct. 13, 1995, regarding purchasers of MoDos TCF pulp, who include a converter for food wrapping papers. There are approximately 100 university presses in the United States, and an additional 6-10 in Canada, per telephone conversation with Tony Crouch, Director of Design and Production for the Univ. Of Calif. Press, Oct. 1995.
39 38

37

V-48
TABLE V-11
DEMAND FOR PULP AND PAPER PRODUCTS IN THE GREAT LAKES REGION COMPARED TO THE SUPPLY PRODUCED BY 20 GREAT LAKES MILLS

COMMODITY

GREAT LAKES 20 MILL SUPPLY (1,000 tons)

CONSUMER SECTOR

GREAT LAKES DEMAND (1,000 tons)

RATIO: REGIONAL DEMAND/ MILLS SUPPLY

Market Pulp Coated Freesheet Papers Uncoated Freesheet Papers Tissue Products

2,321.48 1,196.29

Paper Mills Printing & Publishing Industries (1) Printing & Publishing Industries Consumer, Commercial & industrial

2,077.64 1,339.85

0.9 1.1

490.01

3,695.51

7.5

1,197.20

1,945.4

1.6

Source: Pulp & Paper 1994 North American Factbook, 1995 Lockw ood-Post's Directory US Census of Manufactures, 1992 Notes: (1) Printing & Publishing Industries include: U.S. SIC 27 (except SIC 279, Printing Trade Services and 2711, New spapers) and Canadian Major Group 28.

V-49
TABLE V -12: INDUSTRY PROFILE M AJOR SECTORS OF THE PRINTING AND PUBLISHING INDUSTRY IN THE GREAT LAKES STATES (U.S.) Num be r OF ESTABL
C OMMER C IAL PR IN TIN G

ESTABL OV ER 20 PERSONS
2,140 5,596 38% 308 793 46% 405 991 41% 183 540 34% 220 570 39%

TOTAL NUM BER EM PLOYEES


228,533 568,700 40% 60,200 130,500 46% 48,800 116,200 42% 17,600 47,900 37% 24,500 65,400 37%

ANNUAL PAYROLL ($1,000)


$6,203,900 15,370,600 40% $2,050,100 $4,036,400 51% $1,954,100 $4,074,500 48% $513,700 $1,343,200 38% $657,000 $1,732,900 38%

PROD. WORKERS
159,900 409,200 39% 24,500 57,400 43% 6,700 20,100 33% 12,200 33,600 36% 9,000 23,700 38%

V ALUE ADDED ($1,000)


$13,181,800 31,975,000 41% $7,771,400 $14,328,000 54% $8,716,200 $15,833,000 55% $1,440,500 $3,924,700 37% $3,156,500 $8,524,900 37%

COST OF M ATERIALS ($1,000)


$9,566,400 24,374,900 39% $4,013,700 $7,206,100 56% $3,471,400 $6,200,900 56% $1,367,400 $3,499,900 39% $1,069,200 $2,476,700 43%

V ALUE SHIPM ENTS ($1,000)


$22,762,600 56,438,900 40% $12,126,734 $21,419,000 57% $13,641,200 $22,033,900 62% $2,807,700 $7,435,900 38% $4,221,400 $10,977,100 38%

total Great Lakes: total U.S.: Ratio GL/US total Great Lakes: total U.S.: Ratio GL/US total Great Lakes: total U.S.: Ratio GL/US
B U SIN ESS F OR M PR IN TIN G

12,100 38,465 31% 1,081 3,267 33% 1,278 4,699 27% 299 922 32% 1,048 3,390 31%

B OOK PU B L ISH ER S & PR IN TER S

PER IOD IC AL S: PU B L ISH IN G, OR PU B L ISH IN G & PR IN TIN G

total Great Lakes: total U.S.: Ratio GL/US


MISC EL L AN EOU S PU B L ISH IN G

total Great Lakes: total U.S.: Ratio GL/US

TOTAL U S GR EAT L AK ES, MAJOR PU B L ISH IN G AN D PR IN TIN G SEC TOR S 15,806 3,256 379,633 $11,378,800 TOTAL U .S., MAJOR PU B L ISH IN G AN D PR IN TIN G SEC TOR S: 50,743 R ATIO, GR EAT L AK ES/U .S. 31% 38% 41% 43% 8,490 928,700 $26,557,600

212,300 544,000 39%

$34,266,400 $74,585,600 46%

$19,488,100 $43,758,500 45%

$55,559,634 $118,304,800 47%

Source: Census of Manuf actures, 1992. Great Lakes states includes: Illinois, Indiana, Michigan, Minnesota, New Y ork, Ohio, Pennsylvania, Wisconsin. Note: V alue of shipments estimated f or Indiana Book Publishing (SIC 2731) and Book Printing (2732).

V-50 located within the Great Lakes region -- chiefly in Michigan, New York and Pennsylvania. Clearly, publishers and printers in the Great Lakes region are in an excellent position to encourage regional pulp and paper mills to shift to TCF operations by providing substantial market incentives through their growing demand for chlorinefree and dioxin-free paper. The publics interest in environmentally benign paper products is also reflected in recent government actions. The U.S. General Services Administration has purchased over $1.1 million worth of PCF tissue (napkins, bathroom tissues and towels) and TCF bond, xerographic and envelopes during Fiscal Year 1995 and reports receiving requests from other Federal agencies for TCF paper procurement. 40 In 1993, an effort was made to include TCF in the requirements for Federal government paper products, but this provision was eventually deleted from the Executive Order on purchasing requirements. However, several states and cities have passed ordinances to encourage the procurement of TCF paper products. (See Table V-13.) Finally, households -- a large customer for tissue products -- are an important vehicle for generating a demand for TCF. The tissue products produced by the Great Lakes deinking mills -- such as the paper towels, napkins, and table covers produced by the large Fort Howard mill in Green Bay, WI -- are a major component of the regions paper output. Increased consumer acceptance of slightly lower brightness (i.e., products in the range of 75-80 ISO) for sanitary tissues would encourage the adoption of PCF brightening for deinked pulp. In Europe, consumers in the Nordic and Germanspeaking countries seek out products made from TCF pulp in preference to higherbrightness ECF pulp, especially in sanitary products. It is now possible to produce PCF sanitary tissues with a high post-consumer recycled content (60% or more) from mixed waste paper and a brightness level of about 78% GE at competitive prices. Thus, the Great Lakes region is in an advantageous position to implement a policy based on a demand-driven transition to TCF production by the regions pulp mills. The regions printing and publishing industry could take the lead, among industrial paper consumers, in shifting to TCF products. The Great Lakes Governors Council, which has been actively developing purchase programs for recycled paper, could extend them to include TCF and PCF paper. The Federal Administration could reverse its rejection of TCF requirements in government purchase program. Cities in the region could follow the example of Chicago and Ann Arbor, which have procurement policies favoring non-chlorine bleached paper products.

The following amounts of TCF paper were purchased by GSA: Napkins (4 types): $100,000; toilet tissue: $580,000; towels (3 types): $350,000; bond: $30,000; xerographic: $50,000; and an unspecified amount of envelopes; per telephone conversation with John Marrone, US General Services Admin., 10/16/95.

40

V-51 Table V-13: Government Purchasing Policies: Totally Chlorine Free Paper
Legal Citation and Effective Date State of Oregon Governors Executive Order No. EO-90-09 9/1/90 Description Develop purchasing practices for paper products made from paper with no bleach or without chlorine. Purchase recycled TCF photocopy paper if readily available and priced similarly to nonTCF recycled. Purchase postconsumer and TCF recycled paper and paper products; use equipment that operates with them. Affects State agencies, contractors Additional Details Dept. of General Services to provide guidelines, including sources; DGS bidders to report whether their products are TCF All City departments shall change specifications to conform to ordinance Printed pieces say if TCF or recycled; TCF must meet lowest recycled paper prices; re-evaluate standards and specs; annual reports. Several departments provide technical assistance to implement; annual reports.

City of Seattle Ord. #116270, Sec. 4 of Municipal Code Section 3.18.918 7/8/93 City of Chicago City Council Ord., Sec. 2-92-590 of Chap. 2-92, Municipal Code 3/1/96

City depts. Director of Administrative Services

City purchasing agents, contractors, consultants

All City departments City depts., contractors, City of Bellevue, WA Admin. Order No. 94-01 shall use paper that has consultants 3/1/96 not been bleached with chlorine.

Phased-in program to State agencies must Current bid is for State of reduce chlorine buy from state contract, janitorial products. Massachusetts Environmental Policy bleached purchases. local governments may DPGS may expand to Statement by Dept. of TCF given preferences also. other paper and paper Procurement and when price is equal; products in the future. General Services in goal to eliminate Invitation for Bids chlorine-bleached Effective 4/26/95 products by 3/31/97 Source: Government Purchasing Project, Center for the Study of Responsive Law

In sum, the Great Lakes region is in an excellent position to implement the transition to TCF and PCF production in the regions mills and thereby virtually eliminate their waterborne emissions of dioxin and other chlorinated pollutants. Although the current markets for TCF pulp and paper products in the U.S. are small, the potential exists in the U.S. for the markets to grow substantially as a result of the same concerns that spurred development of the TCF market in Germany. The environmental and public health concerns that have created the existing markets for

V-52 TCF production could create a rapid increase in demand in the U.S., similar in magnitude to the rapid development of markets for recycled post-consumer fibers in paper over the past ten years. Many of the same groups that first purchased recycled paper, such as colleges and universities, environmental organizations, and environmentally conscious corporations, are beginning to seek out TCF paper products. A number of grassroots citizens campaigns have recently emerged to inform purchasers about paper manufactured without chlorine-based bleaches, and to encourage consumers, government agencies, and institutions to purchase these papers. For example, The Reach for Unbleached campaign, a coalition of citizens groups in Washington state led by the Washington Citizens for Recycling, 41 publishes a consumers guide to stores in the Seattle area that sell different grades of paper and tissue products. In the Great Lakes region, students are working with the University of Michigan to alter procurement practices. 42 Student organizations in other states, such as the Student Environmental Action group of the University of Virginia 43, have started campus campaigns to improve their colleges procurement of recycled and non-chlorine based paper. The International Market for TCF and PCF Paper and Pulp Another important policy consideration relates to the position of the U.S. pulp and paper industry -- and of its significant sector in the Great Lakes -- in the international market. Exports play an increasingly important role in the U.S. and Canadian pulp and paper industry, accounting for about 8.5% of the total value of U.S. paper goods shipments in 1992 (U.S. Industrial Outlook 1993, p. 10-4). U.S. exports of paper and allied products (including wastepaper) totaled an estimated $10.4 billion in 1992. These exports consisted mainly of market pulp (about 31% of the total value), printing and writing papers, including newsprint (15%), linerboard (11%), wastepaper (6%), boxboard (8%), and sanitary and all other converted products (almost 30%) (U.S. Industrial Outlook 1993, p. 10-3). The European Community is the principal regional export market for the U.S. paper industry, accounting for about 22% of the total value in 1992. Germany tops the list of European countries importing U.S. pulp and paper products, purchasing about $483 million of U.S. paper products (over 5% of the export

For information and brochures, contact Susan McLain, Program Director of the Washington Citizens for Recycling, (206) 343-5171. At the Source; Campaigns Aim for Zero Discharge in Great Lakes, p.3, Scott Sederstrom, Great Lakes United, September/October 1995.
43
42

41

Contact Larry Ferber, University of Virginia Student Environmental Action, e-mail address: lrf9q@galen.med.virginia.edu.

V-53 market) and 600,000 metric tons of market pulp worth, about $300 million (9% of U.S. exports of bleached kraft market pulp) in 1992 (U.S. Industrial Outlook 1993, p. 10-7). Canada supplies about one-third of Germanys demand for bleached kraft pulp (MIT, 1993). The conversion of the Scandinavian pulp and paper industry to TCF and ECF technologies came largely in response to market demand from Germany and to public demand for less pollution from pulp and paper mills. In November 1990, a German governmental scientific advisory group (Rat der Sachverstaendigen fuer Umweltfragen) called for a ban on chlorine bleaching in the pulp industry (Greenpeace 1994a). Although no subsequent legislation was passed, in 1991 the German government advised the pulp and paper industry to phase out all chlorine-based bleaching. These activities reflect the concern of European environmentalists and consumers over the health and environmental impacts of organochlorine pollution by the paper industry. This concern, coupled with proactive environmental regulators in Germany and the Nordic countries, has accelerated the adoption of TCF process changes in the Nordic paper industry over the past ten years (Greenpeace 1994a, p. 5). For example, an agreement of the Nordic Ministers of the Environment in 1990 regarding organochlorines stated, The discharges of chlorinated organic substances should be eliminated altogether....The Nordic countries should aim at reaching this goal as soon as possible. Additionally, the Nordic Environmental Labelling scheme, adopted in 1994 by the Swedish Standards Institution, creates a rating system for Environmental labeling of fine paper (with and without wood pulp) for printing, writing and copying. The formula for rating paper employed in this system favors the use of TCF over ECF papers, and sets a maximum limit of 0.40 kg AOX/ton of paper. The results of these initiatives are impressive. According to the Confederation of European Paper Industries (CEPI), one million metric tons of TCF kraft pulp were consumed in Europe in 1993, accounting for 30% of the total market for printing and writing paper in the Nordic and Germanic countries. Several German magazines with large national circulation, including Der Spiegel, the largest circulation weekly in Germany, converted to the use of TCF paper in the early 1990s. Among other business purchasers of TCF paper, the international furniture company IKEA now prints its catalogue on paper made from Scandinavian TCF kraft (Greenpeace 1994b). Consumer demand for TCF has continued to rise: CEPI projected that by 1996, 60-70% of all printing and writing paper in the Germanic and Nordic countries will be TCF (Clark 1993). Industry sources estimate that approximately 50% of the woodfree printing and writing grades of paper used in the Germanic and Nordic countries currently is TCF. 44 The Benelux countries -- Belgium, Netherlands and Luxemborg -- are also expected to increase their markets for TCF pulp and paper products. 45 Additional, but smaller,

44 45

Soedra Cell, personal communication, 5/6/96. International Papermaker, November 1995, Vol.58, No. 11,TCF is the Right Product.

V-54 markets now exist in France, Italy and the United Kingdom. For example, over 100 brands of TCF papers are available to purchasers in the UK, including business stationary and office papers, coated and uncoated printing papers, specialty papers and paperboards.46 By mid-1994, 22 mills produced TCF bleached kraft pulp in Europe (see Table V14). There were also 17 mills in Europe producing TCF bleached sulfite pulp at this time, most of them integrated pulp and paper mills. The capacity to produce TCF kraft pulp in northern Europe continues to grow; the worlds first greenfield pulp mill producing TCF started in March 1996 at Rauma on Finlands West Coast; it will produce 500,000 tons per year of TCF softwood pulp. 47 Soedra Cell, Europes largest chemical pulp producer (and also largest TCF pulp producer) is also currently expanding its production of TCF market pulp. According to Soedra Cell, in 1995, 75% of their production was TCF, rising to 91% in February of 1996. Soedra Cells goal is to produce only TCF pulp within two years.48 As seen from Table V-14, many of the kraft mills listed as producing TCF pulp have used only a portion of their capacity to produce and market TCF pulp. As is typical of fast growing markets, the TCF capacity has become greater than what is currently supplied. This has occurred as the worldwide pulp and paper industry hit a peak in 1996; worldwide inventories and capacity overcame demand, causing market pulp prices to fall to unprofitable prices. This difference reflects the potential of many companies to increase their output of TCF pulp while they increase market share for these products. An ability to shift between production of either TCF and ECF pulp has enabled these mills to build-up their production of TCF while the markets develop. Rather than produce TCF on pure speculation, major TCF suppliers have adopted a degree of flexibility in their production that enables them to synchronize their TCF output with incremental increases in TCF demand. This assures that the TCF product can realize a market premium price for the environmental qualities that purchasers seek, and cover producer costs. When TCF pulp was first introduced, careful supply management wasnt necessary. As in many successful new product markets, demand outstripped supply,

The Soedra Cell Guide to TCF Papers, Soedra Cell (UK) Limited, 1996. International Papermaker, Nov. 1995: The Metsa-Rauma plant representatives state that the mill design is aimed at maximum recirculation of process water and chemicals, and ultimately, totally effluent free (TEF) production.
47 48

46

Personal communication, Roland Loevblad, SOEDRA CELL AB, March 3, 1996. Also, Response from Soedra Cell, Autumn 1995.

TABLE V-14: Worldwide TCF chemical pulp producers


Country/producer/location SWEDEN Aspa Bruk, Aspa Bruk ASSI Doman Karlsborg (1) Holmens Bruk, Wargons Bruk Koltneros Korsnas, Gavle MoDo Paper, Domsjo MoDo Paper, Husum NCB Vallvik Rockhammer, Frovi Roltneros Roltneros SCA Wifsta-Ostrand, Timra Soedra Cell, Morrum Bruk Soedra Cell, Varo Bruk Soedra Cell, Monsteras Stora Cell, Norrsundet Stora Cell, Skoghall Stora Cell, Skutskar Stora Papyrus, Nymolla Roltneros, Utansjo Roltneros, Utansjo NORWAY Borregaard Indust, Sarpsborg Norske Skog, Tofte FINLAND Enocell, Ulma Kymmene, Pietarsaari Metsa-Botnia, Kaskinen Metsa-Botnia, Kemi Metsa-Rauma (2) Metsa-Selia, Aanekoski Sunila, Sunila Veitsiluoto, Kemijarvi PORTUGAL Caima, Constancia Celbi, Figueira daFoz SPAIN ENCE, Pontevedra USA Louisiana-Pacific, Calif. Lyons Falls Pulp & Paper GERMANY Hannover, Alfeld PWA, Manheim+Stockstadt Rosenthal, Blankenstein Schwabische Zellstoff, Ehingen Stora, Baienfurt AUSTRIA Leykam, Gratkorn Neusiedler, Kematen PWA, Hallein FRANCE Stracel, Stasbourg SWITZERLAND Cellulose Attisholz, Luterbach Cellulose Attisholz, Luterbach CZECH REP. Biocel CANADA Atholville Pulp, Atholville Canfor, Prince George Howe Sound, Howe Sound (1) Millar Western, Meadow Lake Stora Forest, Pt. Hawkesbury BRAZIL Aracruz ITALY Cellulosa Calabra, Crotone Metric Tons 115,000 260,000 45,000 50,000 240,000 100,000 200,000 55,000 60,000 90,000 350,000 (Total for 3 Mills) 275,000 160,000 330,000 340,000 70,000 80,000 160,000 50,000 100,000 100,000 300,000 100,000 500,000 100,000 50,000 70,000 50,000 100,000 10,000 40,000 90,000 400,000 150,000 110,000 30,000 220,000 40,000 110,000 40,000 50,000 50,000 50,000 120,000 20,000 20,000 240,000 100,000 150,000 50,000 Grades Process Market X X X X X X X X X X X X X X X X X X Integrated

S Kraft Oxygen + Peroxide H+S Kraft Oxygen + Peroxide S Sulfite Peroxide H+S Sulfite Kraft Fluff Oxygen+Peroxide S Sulfite Oxygen+Peroxide H Kraft S Kraft Oxygen+Peroxide H+S CTMP Peroxide S CTMP Peroxide S Mech Peroxide H+S Kraft Oxygen+Peroxide(Lignox) H+S Kraft Oxygen S Kraft Oxygen+Peroxide H+Kraft Oxygen+Peroxide S Kraft O Eop H+S Kraft Oxygen+Peroxide Kraft Fluff+H Kraft O Eop H+S Sulfite Oxygen+Peroxide H+S Sulfite Peroxide S Mech S Sulfite H+S Kraft H+S Kraft H Kraft H+S Kraft H+S Kraft S Kraft H+S Kraft S Kraft H+S Kraft H Sulfite H Kraft H Kraft S Kraft Sulfite S Sulfite H+S Sulfite S Sulfite H+S Sulfite ASAM H+S Magnefite S Sulfite S Sulfite H+S Sulfite H Sulfite S Sulfite S Sulfite Sulfite S Kraft S Kraft H CTMP S Sulfite H Kraft H NaCo Peroxide Oxygen+Peroxide Oxygen+Peroxide Oxygen+Peroxide(Lignox) Oxygen+Peroxide Oxygen+Peroxide MCC+O-P-X MCC+O-P-X

X X X

X X X X X X X X X X

Oxygen+X+P Oxygen+Peroxide Peroxide Oxygen+Peroxide Oxygen+Peroxide

X X X X X

Peroxide-Hydrosulphite

X X X

EOP-P-P O-P Q-EOP-PNC/PNC EOP-P EO-P EOP,EOP-P,EOP-P-P-P-P EOP,EOP-P,EOP-P-P-P-P

X X

X X X X X

X X X X Closed x x x x

Peroxide

Source: Pulp & Paper magazine, June 1994; 1995 Lockwood-Post's Directory Notes: (1) The Howe Sound mill in Canada and ASSI Doman Karlsborg mill in Sweden did not produce TCF pulp in 1995. (2) Metsa-Rauma, the world's first greenfield TCF pulp mill, was scheduled to start producing in March 1996. (3) The two Canadian kraft mills do not produce TCF on a permanent basis, but are capable of making TCF bleached pulp in response to requests from customers.

V-56 no matter how fast industry increased output. But at this time, as capacity has caught up to demand, TCF suppliers have turned to aggressive marketing and appear to be restraing speculative output growth in order to maintain price premiums. AET (1996), competitors of TCF, have described the TCF output-capacity gap as evidence of TCF market limits, rather than as a typical characteristic of a developing new market. That TCF markets have not reached their limits, as ECF competitors claim, is evident from continued investment in TCF. These developments in Europe suggest strongly that the future ability of the U.S. pulp and paper industry to compete in the international market will depend considerably on its ability to produce TCF pulp and paper. There was a substantial premium for TCF pulp in fourth-quarter 1995 market pulp prices, but this was expected to decline as additional TCF capacity comes on line in 1996. 49 Apparently, consumers are willing to pay more for what they consider to be an environmentally superior product. Market pulp prices plunged rapidly during the first quarter of 1996, and TCF and ECF producers were not reporting prices differentials during this period. As market pulp prices stabilize in the near future, a premium price for TCF in the European market could be reestablished. The only TCF kraft chemical pulp producer in the U.S., Louisiana-Pacific, does not now receive a price premium for their TCF chemical pulp. The company views their current pulp pricing strategy as the necessary steps a producer must take to develop and expand demand for a new product in a supply driven market.50 For the reasons already cited, the Great Lakes pulp and paper industry is in an excellent position to move rapidly toward TCF production, and by doing so improve its position in the international market. Increased income from TCF sales could be used to justify the investments needed to expand TCF production in the United States and Canada. In sum, there are both powerful environmental and economic reasons for a Great Lakes policy designed to implement the practical, achievable goal of converting the regional pulp and paper industry into one that is characterized by totally chlorine-free operations -- thereby ending the industrys contribution to the environmental hazards of dioxin and its kindred, highly toxic chlorinated organic substances.

The fourth-quarter 1995 market pulp prices announced by global producers included a substantial premium for TCF, as compared to ECF, pulp. Fourth-quarter 1995 prices for TCF market pulp announced by global producers of market pulp include: for Northern Bleached Softwood Kraft: ECF $1000/ton; TCF $1080/ton (Sodra); ECF and TCF eucalpytus pulps: Ecu 735/ton and Ecu 795/ton, respectively. From Pulp & Paper International, This Week 10, no.25 (June 26-30, 1995). 50 Conversation with representative of Louisiana-Pacific, February 28, 1996.

49

V-57 References: Albert, Richard J., 1994a: Effluent-Free Pulp Mill Possible With Existing Fiberline Equipment. Pulp & Paper, July, pp. 83-89. Albert, Richard J., 1994b: Worldwide Survey: State-of-the-Art TCF Bleaching, In Intl Non-Chlorine Bleaching Conference Proceedings, Florida, Mar.. Alliance for Environmental Technology (AET), 1995: Five Great Reasons Why We Care, Executive Summary, p. 3, Sept. American Forest & Paper Association, (AF&PA), 1996: Correspondence from Jerry Schwartz to CBNS, February 12. Badger Paper Mills, Inc. 1994 Annual Report. Badger Paper Mills, Inc., Securities Exchange Commision (SEC) filings. Beck, H., et. al, 1988: Occurrence of PCDD and PCDF in different kinds of paper, Chemosphere, 17(1): 51-57. Berry, R.M., C.E. Lutke, and R.H. Voss, 1993: Ubiquitous nature of dioxins: a comparison of the dioxin content of common everyday materials with that of pulps and papers. Env. Sci. & Tech., 27(6): 1164-1168. Bettis, John, 1991: Bleach Plant Modifications, Controls Help Industry Limit Dioxin Formation. Pulp & Paper, June, pp. 76-82. Bicknell, B. and D. Spengal (Radian Corp.) and T. Holdsworth, U.S. EPA, 1995: Toxicity Testing of Effluents from ECF and TCF Eucalyptus Kraft Pulp. In Intl Non-Chlorine Bleaching Conference Proceedings, Florida, Mar.. Bruner, Deborah, Jossey-Bass Pub. Inc.,1995: Environmentally Responsible Publishing. Presentation to AAUP Annual Convention, Western Presses Div., Oct. 1995. Cates, Dwight H., et al., University of Georgia, 1995: Comparison of effluents from TCF and ECF bleaching of kraft pulps. Tappi Journal, 78(12): 93-98. Dec. Chung, A. et al., 1990: Measures to Control Chlorinated Dioxin and Furan formation and Releases at Canadian Bleached Chemical Pulp Mills. Chemosphere 20(10-12): 1739-46. Clark, D., 1993: Non-chlorine pulp and paper markets from a European perspective.

V-58 Intl Non-chlorine Bleaching Conference, Mar. Clement, R.E., et al., Ontario Ministry of Environment, 1989: Concentration of Chlorinated DiBenzo-p-Dioxins and DiBenzoFurans in Effluents and Centrifuged Particulates from Ontario Pulp and Paper Mills. Chemosphere 19(1-6): 649-654. Cohen, Mark, et al., 1995: Quantitative Estimation of the Entry of Dioxins, Furans and Hexachlorobenzene Into the Great Lakes from Airborne and Waterborne Sources. Report to the Joyce Foundation, May. Cook, Roger, E.B. Eddy, 1992: Challenges in the Development of Totally Chlorine-Free Kraft Pulp Bleaching Technology. In Proceedings, Intl Symposium on Pollution Prevention in the Manufacture of Pulp and Paper, Washington, D.C., Aug. deChoudens, C., R. Angellier, and B. Brouchier, Domaine Universitaire, France, 1995: ECF and TCF Bleaching of Mixed Hardwoods and Douglas Fir Kraft Pulps in Pilot Plant. In Intl Non-Chlorine Bleaching Conference Proceedings, Florida, Mar.. Dahlman, Olof, Anders Reimann, Lars Strmberg, and Roland Mrk, 1994: On the Nature of High Molecular Weight Effluent Materials from Modern ECF- and TCFBleaching. In Intl Pulp Bleaching Conference - Papers, pp 123-132. Dimmel, Donald R. et al., 1993: Formation Mechanisms of Polychlorinated Dibenzo-pdioxins and Dibenzofurans During Pulp Chlorination. Env. Sci. & Tech. 27(12):25532558. Eklund, Helge, 1995: ECF vs. TCF - A Time to Assess and a Time to Act. Pulp & Paper, May, pp. 83-87. Federal Register, 1993: Effluent Limitations Guidelines, Pretreatment Standards, and New Source Performance Standards: Pulp, Paper and Paperboard Category; National Emission Standards for Hazardous Air Pollutants for Source Category: Pulp and Paper Production, Proposed Rule. EPA 40 CFR Parts 63 and 430, Dec. 17. Federal Register, 1994: Extension of comment period to April 1994. Mar. 17. Fiedler, H. and C.W. Timms, 1990, Dioxin in Pulp & Paper, Organohalogen Compounds, 4, pp 347-352. Folke, Jen, 1995: Does COD Provide a Useful Indication of the Sub-Lethal Toxicity of ECF and TCF Effluents? In Intl Non-Chlorine Bleaching Conference Proceedings, Florida, Mar.. Forbes, David and Don Manolesch, 1994: Is Retrofitting to TCF Manufacture Cost-

V-59 Effective? In TCF and ECF: Separating Fact from Fiction. AET, Sept. Grahn, Olle and Caroline Grotell, 1995: Effects in Model Ecosystems of Bleach Plant and Whole Mill Effluents from Production of TCF- and ECF-Bleached Softwood Kraft Pulp at the Sdra Cell AB Mill Vr Bruk. Swedish Environmental Research Group (MFG), Fryksta, Kil, Sweden, Sept. Greenline, 1995: Exploding the Myths: Part IX. Conservatree, Sept. Greenpeace, 1994a: The Medium is the Message: Water Pollution, Time Magazine, and Opportunities for Clean Production. Mark Floegel. P. 5. Also, Hamburger Umweltinstitut, private comm. with Anke Bujanowski, 10/12/95. Greenpeace, 1994b: Comments on U.S. Environmental Protection Agency Draft Cluster Rule for Pulp and Paper Industry. J. Thornton, M. Floegel, J. Weinberg, Apr. Helsel, Dennis R., 1990: Less than obvious: Statistical treatment of data below the detection limit, Env. Sci. & Tech., 24(12):1766-1774. International Joint Commission (IJC) 1995: Review of Develpments in the Pulp and Paper Industry. In 1993-1995 Priorites and Progress Under the Great Lakes Water Quality Agreement. pp. 35-47. Windsor, Ont., Aug. Intl Papermaker, Nov. 1995, Vol.58, No. 11,TCF is the Right Product. Jaegel, A.F. and K.A. Girard, 1994: TCF Bleaching at the Louisiana-Pacific Corporation Samoa Pulp Mill. Samoa, CA. Johansson, N., G. David, E. Fletcher, 1994: Optimization of Bleaching Sequences in Order to Help Meet Environmental Regulations. Intl Non-Chlorine Bleaching Conf. Proceedings, Fla. Krahn, Peter J., Environment Canada, 1995: Dioxins and Furans in British Columbia Pulp Mill Effluent, (1987-1995), Organhalogen Compounds, Vol, 24 pp 217-221. LaFleur, L. et al., 1990: Studies on the Mechanism of PCDD/PCDF Formation During the Bleaching of Pulp. Chemosphere 20(10-12): 1731-1738. Lancaster, Lindsay M. et al., 1992: The Effects of Alternative Pulping and Bleaching Processes on Product Performance. In Proceedings, Intl Symposium on Pollution Prevention in the Manufacture of Pulp and Paper, Washington, D.C., Aug. Lockwood-Post's Directory of the Pulp, Paper and Allied Trades: 1989, 1994,1995, & 1996. Miller Freeman, San Francisco and New York.

V-60 Louisiana-Pacific Corp., Samoa, 1994: Samoa Pulp Mill Totally Chlorine Free Pollution Prevention Program. Sept. Lvblad, Roland and Jan Maimstrm, Sdra Cell AB, 1994: Biological Effects of Kraft Pulp Mill Effluents -- A Comparison Between ECF and TCF Pulp Production. In Intl Non-Chlorine Bleaching Conference, Proceedings, Florida, Mar.. Management Institute for Environment and Business (MEB), 1994: Competitive Implications of Environmental Regulation of Chlorinated Organic Releases in the Pulp and Paper Industry. Review copy by Ben Bonifant and Ian Ratcliffe, p. 33. (See also: Luken, Ralph A., 1990: Efficiency in Environmental Regulation: A Benefit-Cost Analysis of Alternative Approaches. P. 266) Manufacturing Industries of Canada, National and Provincial Areas 1991-1992, Statistics Canada, Ottowa. Massachusetts Institute of Technology (MIT), 1993: Dimensions of Managing Chlorine in the Environment, Mar. McCubbin, Neil, et al., 1992: Best Available Technology for the Ontario Pulp and Paper Industry. Environment Ontario. McCubbin, Neil, 1992: Costs and Benefits at Various Pollution Prevention Technologies in the Kraft Pulp Industry. In Proceedings, Intl Symposium on Pollution Prevention in the Manufacture of Pulp and Paper, Washington, D.C., Aug. Mozes, Liz, 1994: Alternatives To Chlorine-Based Paper Making. Washington Toxics Coalition. July. NCASI, National Council of the Paper Industry for Air and Stream Improvement, 1994: Progress in reducing the TCDD/TCDF content of effluents, pulps and wastewater treatment sludges from the manufacturing of bleached chemical pulp. Special Report No. 94-08, Research Triangle Park, Virginia, Aug. NCASI, 1995: Progress in reducing the TCDD/TCDF content of effluents, pulps and wastewater treatment sludges from the manufacturing of bleached chemical pulp. Special Report 95-02, Research Triangle Park, Virginia, Nov. NCASI, !996: Correspondence to CBNS from Jay Unwin, Central-Lake Sates Regional Center, Western Michigan University, Kalamazoo, February 19. Nehrt, Chad, 1993: Pollution Control Investment and Competiveness: a Multi-Country Study of the Paper Industry. Dissertation, University of Michigan, Business Administration.

V-61 Nehrt, Chad, 1995: Spend more to show rivals a clean pair of heels. Intl Pulp & Paper June, pp. 81-82 Nelson, P.J. et al., 1995: Toxicity Testing of Effluents From ECF and TCF Bleaching of Eucalyptus Kraft Pulp. In Intl Non-Chlorine Bleaching Conference Proceedings, Florida, Mar.. Nutt, W. et al., 1993: Developing an Ozone Bleaching Process. TAPPI Journal, 76(3):115-122. Ontario Gazette, 1993: Ontario Regulation 760/93, filed Nov. 25. Effluent Monitoring and Effluent Limits - Pulp and Paper Sector. Panchapakesan, B., 1991: Process Modifications End-of-Pipe Technologies Reduce Effluent Color. Pulp & Paper, pp 82-84, Aug. Patrick, Ken, et al., 1994: Closing the Loop: The Effluent-Free Pulp and Paper Mill. Pulp & Paper, Mar.. Paper Age, 1995: Kiefer Paper Mills-Ahlstrom Kamyr -- A Partnership that Works. Jack OBrien, pp. 18-23, July. Paper Task Force, 1995: Paper Task Force Recommendations for Purchasing and Using Environmentally Preferable Paper, Final Report. Environmental Defense Fund, New York, Dec. Paper Task Force, 1995b: Economics of Kraft Pulping and Bleaching, White Paper No. 7. Environmental Defense Fund, New York, Dec 19. Paper Task Force, 1995c: Environmental Comparisons of Bleached Kraft Pulp Manufacturing Technologies, White Paper No. 5. Environmental Defense Fund, New York, Dec 19. Phillips, Richard B., Caifang Yin, Lindsay M. Lancaster and Jean J. Renard of International Paper, 1992: The Effects of Alternative Pulping and Bleaching Processes on Product Performance - Economic and Environmental Concerns. In Intl Symposium on Pollution Prevention in the Manufacture of Pulp and Paper. Aug. Pichler W., et al., 1995: Pulping and ECF/TCF Bleaching of OCC. In Proceedings, Intl Non-Chlorine Bleaching Conference, Florida, Mar. Porter, P. Steven, Richard C. Ward and Harry F. Bell, 1988: The detection limit, Env. Sci. & Tech., 22 (8): 856-861.

V-62 Pryke, D.C., S.M. Swanson, G.R. Bourree, J.W. Owens and P.J. Kloepper-Sams, 1995: Environmental Imporvements at Grande Prairie and Ecosystem Response, Pulp & Paper Canada, Vol. 96, No. 11, pp 41-48. Pulp & Paper Intl, This Week, 1995. Vol.10, No.25, June 26-30. Pulp & Paper Week, 1995. Vol. 17, No. 45, Nov. 20. Pulp & Paper Magazine, 1994: Survey shows worldwide growth in mills using TCF processes. pp 93-103, June. Pulp & Paper 1994 North American Factbook, Miller Freeman, 1993. Pulp & Paper 1996 North American Factbook, Miller Freeman, 1995. Radian Corporation, 1995: Costs of Upgrading Bleach Plants to Minimize COD Discharges, by Kirsten M. Vice, Roy E. Sieber, and Betsy Bicknell, in Proceedings, Intl Non-Chlorine Bleaching Conference, Florida, Mar. Rantio, Tiina, Univerity of Jyvskyl, Finland, 1995: Chlorinated Cymenes in Effluents of Two Finnish Pulp Mills in 1990-1993. Chemosphere, 31(6): 3413-3423. Rappe, C., B. Glas, L. O. Kjeller, S.E. Kulp, C. de Wit, and A. Melin, 1990: Levels of PCDDs and PCDFs in Products and Effluent from the Swedish Pulp and Paper Industry and Chloralkali Process. Chemosphere, 20(10-12): 1701-1706. Rappe, C. and N. Wagman, 1995: Trace Analysis of PCDDs and PCDFs in Unbleached and Bleached Pulp Samples. Organohalogen Compounds, Vol. 23, pp. 377-381. Rotard, W. et al., 1990: Occurrence of PCDD/PCDF in Newspapers, Magazines, Books and Other Consumer Paper Products, Organohalogens 4, pp. 381-386. Santl, Helmut, Ludwig Gruber, and Elke Sthrer, 1994a: Investigation on the Input, Formation and Fate of Polychlorinated Dibenzodioxins (PCDDs) and Dibenzofurans (PCDFs) in the Pulp and Paper Industry. Chemosphere, 29(9-11): 1987-1994 Santl, Helmut, Ludwig Gruber, and Elke Sthrer, 1994b: Some new sources of polychlorinated dibenzodioxins (PCDDs) and dibenzofurans (PCDFs) in waste papers and recycled pulps. Chemosphere, 29(9-11): 1995-2003. Santl, Helmut, Albert Bichmaier, Ludwig Gruber, and Elke Sthrer, 1994: Mass Balance of Polychlorinated Dibenzofurans (PCDFs) and Polychlorinated Dibenzodioxins (PCDDs) in a Recycling Paper Mill. Chemosphere, 28(9): 1633-1639.

V-63 Saunamki, Reijo, Finnish Pulp and Paper Research Institute (KCL), 1995: Treatability of wastewater from totally chlorine-free bleaching. Tappi Journal, 78(8):185-192. Aug. Schwantes, T.A., and T.J. McDonough, Institute of Paper Science and Technology, 1994: Charcterization of Effluent Fractions from ClO 2 and Cl 2 Bleaching of Unbleached and O2 Bleached Softwood Kraft Pulps. In 1994 Intl Environmental Conference, TAPPI, Atlanta Georgia. Sinclair, William F., Environment Canada, 1991: Controlling Effluent Discharges From Canadian Pulp and Paper Manufacturers. Canadian Public Policy - Analyse de Politiques XVII:1, 86-105. Smook, Gary A., 1992: Handbook for Pulp & Paper Technologists, 2nd ed., Angus Wilde Publications: Vancouver, B.C. and Bellingham, WA. Sdra Cell, 1995: Responze, Vxj, Sweden. Spring. Sonnenberg, L.B. and K.M. Nichols, 1995: Emissions of Hydrochloric Acid, PCDD and PCDF From the Combustion of Chlorine-Containing Kraft Pulp Mill Bleach Waste. Chemosphere 31(10): 4207-4224. Suntio, Leena R., Wan Ying Shiu, and Donald MacKay, 1988: A Review of the Nature and Properties of Chemicals Present in Pulp Mill Effluents. Chemosphere, 17(7): 12491290. TetraTech, Inc, 1990: Risk Assessment for 2378-TCDD and 2378-TCDF Contaminated Receiving Waters from U.S. Chlorine- Bleaching Pulp and Paper Mills. Prepared for U.S. EPA, Office of Water Regulations and Standards, Assessment and Watershed Protection Division. Contract No. 68-C9-0013, Work Assignment No. 1-13. Fairfax Va., Aug. Travis, Curtis C. and Miriam L. Land, 1990: Estimating the mean of data sets with nondetectable values, Env. Sci.& Tech., 24(7): 961. Trice, William H., 1992: Bleaching Papermaking Pulps with Oxygen and Ozone in a Commercial Installation. In Proceedings, Intl Symposium on Pollution Prevention in the Manufacture of Pulp and Paper, Washington D.C. USEPA/744/R-93/002. NTIS PB94104312. Aug. Tsai, Ted Y., Jean J. Renard, and Richard B. Phillips, Aug 1994: Formation of polychlorinated phenolic compounds during high chlorine dioxed substitution bleaching, Tappi Journal, 77(8): 149-157. U.S. Bureau of Labor Statistics (BLS), 1994: Technology and Labor in Pulp, Paper,

V-64 Paperboard and Selected Converting Industries. Bulletin 2443, June. U.S. Environmental Protection Agency (U.S. EPA), 1990a: USEPA/ Paper Industry Cooperative Dioxin Study, The 104 Mill Study, Summary Report. Office of Water Regulations and Standards. July. U.S. EPA, 1990b: Background document to the integrated risk assessment for dioxins and furans from chlorine bleaching in pulp and paper mills. Washington D.C. : Office of Toxic Substances. EPA/560/5-90-014 U.S. EPA, 1991: Toxics in the Community, National and Local Perspectives: The 1989 Toxics Release Inventory National Report. U.S. EPA, 1992: Office of Pollution Prevention and Toxics. Intl Symposium on Pollution Prevention in the Manufacture of Pulp and Paper. Aug. U.S. EPA, 1993: Pollution Prevention Technologies for the Bleach Kraft Segment of the U.S. Pulp and Paper Industry. Aug. U.S. EPA, 1993: Development Document for Proposed Effluent Limitations, Guidelines and Standards for the Pulp, Paper and Paperboard Point Source Category. EPA-821R-93-019. Oct. U.S. EPA, 1993: Economic Impact and Regulatory Flexibility Analysis of the Proposed Effluent Guidelines and NESHAP for the Pulp, Paper and Paperboard Industry. EPA821-R-93-021. Nov. U.S. EPA, 1994: Estimating Exposure to Dioxin-Like Compounds, Volume II: Properties, Sources, Occurrence and Background Exposures. Office of Research and Development. EPA/600/6-88/005Cb. June. U.S. Industrial Outlook, 1993: Paper and Allied Products, U.S. Commerce Dept. pg. 104. Water Resources Branch, Ontario Ministry of the Environment, 1992: Best Available Technology for the Ontario Pulp and Paper Industry. Feb. World Bank, 1995: Industrial Pollution Prevention and Abatement: Pulp and Paper Mills. pp 1-5. June 30.

V-65 APPENDIX FOR CHAPTER V: Pulp and Paper Industry

Contents:

Figure V-A: Table V-A.1: Table V-A.2: Table V-A.3: Table V-A.4:

Kraft Pulping and Bleaching Process Pulp and Paper Mills Currently Operating in the Great Lakes Basin Additional Pulping and Bleaching Process Improvements Kraft Bleach Process Improvements of AOX Notes on the Radian Analysis

Tables V-A.5(1-3): Applied Radian Analysis Tables V-A.6(1-4): Applied Paper Task Force Analysis Table V-A.7: TCF Operational Cost Competitiveness with ECF

V-68 TABLE V-A.1 Pulp and Paper Mills Currently Operating in the Great Lakes Basin (using chlorine compounds)
Mill Name U.S. Badger Paper Mills EcoFibre Fort Howard Fox River Fiber International Paper City State or Prov. WI WI WI WI PA Mill Type Integrated with Paper Mill yes no yes no yes Products Bleaching Sequence and Chlorine Compound(s) Used CEH C DEH H C(E/H)PD Hwd

Peshtigo DePere Green Bay DePere Erie

Sulfite Deinking Deinking Deinking Soda

Bond, alkaline based, mimeo, unwatermarked opaque, xerox, bristols, computer paper Market pulp Towel, napkins, place mat, dollies, table and tray covers, coasters, wipers, tissue Market pulp, from post consumer waste. Bond, cover, duplicator, xerographic, envelope, index bristol, ledger, mimeo, offset Sanitary tissue, towel and napkin converted products Machine creped tissue, plain printed and embossed napkins. Color, sulphite bond, fine papers, construction, technical, tablet, envelope Coated book and publication papers, kraft hardwood market pulp Market pulp Coated offset, text and cover, coated web papers. Recycled publishing, book, catalog, opaque, supercalendered, film coated, etc. Deinked pulp for internal use.

James River James River Kerwin Paper Mead Ponderosa Pulp Products Potlatch P.H. Glatfelter Scott Worldwide, Scott Paper S.D. Warren Co., Scott Paper Wisconsin Tissue Mills

Green Bay Ashland Appleton Escanaba Oshkosh Cloquet Neenah Oconto Falls Muskegon Menasha

WI WI WI MI WI MN WI WI MI WI

Deinking Deinking Deinking Kraft Deinking Kraft Deinking Deinking Kraft Deinking

yes yes yes yes no yes yes no yes yes

H* H** H (DC)EoDED Swd (DC)EoDED Hwd HH DEDED Swd DEDED Hwd HH C

Machine coated book, cover and matte coated CEHD Hwd papers. Napkins, place mats, disposable wipes, CEH bathroom tissue, 50% chlorine free

V-69
Champion International Quinnesec MI Kraft yes Hardwood kraft market pulp and coated free sheet ODEoDD Hwd

Table V-A.1 continued Canada Avenor Thunder Bay ONT Kraft, Deinking, Groundwood ONT Kraft yes Kraft market pulps, standard, recycled-content newsprint DREopDEpD Swd DEopDEpD Hwd

E.B. Eddy

Espanola

yes

Kraft market pulp, publishing and industrial/specialty papers Softwood kraft market pulps Kraft market pulps: hardwood, softwood

James River Kimberly-Clark

Marathon Terrace Bay

ONT ONT

Kraft Kraft

no no

ODcEoDnD Swd ODcEoDnD Hwd ODEoDnD (on demand) DEopDED Swd DcPEoDED Swd DcDED Hwd

Sources: Lockwood Post's 1995 Directory, 1994 North American Pulp & Paper Factbook, individual mill surveys Abbreviations: Hwd: Hardwood; Swd: Softwood. For other abbreviations see Table V-5. Notes: * Survey response did not specify bleaching sequence. Probably use hypochlorite (H). ** Survey reported hypochorite (H) use for breaking wet strength (non-chlorine alternatives exist), but did not specify bleaching chemicals.

V-70
Table V-A.2 Additional* Pulping and Bleaching Process Improvements These improvements generally decrease the amount of bleaching chemicals needed and thereby improves emissions and conserves operating expenses of other bleaching chemicals. Process Chelation Q Description Removes metals which inhibit the oxidation reactions of peroxide and ozone. Peroxide bleaching under pressure with oxygen at higher temperatures. Uses 1/2 the chemical and 1/2 the time of conventional peroxide bleaching. Improves bleachability and extractability of lignin. Xylanese, mannanase, and lacase enzymes. Acidic delignification. Advantage/Disadvantage Improves performance and efficiency of peroxide (P) and ozone (Z) bleaching. Makes brighter pulp posssible (Not needed for chlorine dioxide stage.) Metals may need alternative disposal or recovery technology. Economizes on peroxide use. For ECF, as a substitute stage, it reduces usage of ClO 2. Can make TCF competitive with ECF. Capital cost similar to conventional P stage, but significant capital cost for upgrade. Low capital and low chemical usage since catalytic reactive. Less oxidative chemicals usage results in higher brighteness. More commercial research is needed. Can substitute for Ozone delignification. Minimal capital expense, high chemical cost. Costs may improve with further research. Extends delignification in the cooking stage. Requires new capital expenditures.

Pressurized Peroxide Bleaching

PO

Enzyme Pre-Bleaching

Peracid Delignification Polysulfide

Paa

PS

Polysulfide extended delignification.

*Other process modifications--like oxygen, ozone and extended cooking -- are discussed in the text.

V-71
Table V-A.3 Kraft Bleach Process Improvements of AOX Process Improvement Extended/ Modified Cooking Anthraquinone Cooking Improved Brownstock Washing Oxygen Deliginification Pressurized Peroxide 100% Chlorine Dioxide Bleaching Totally Chlorine Free 1 O PO D ECF TCF AQ % AOX Decrease 10-65 10-20 5-10 25-35 20-40 80 100 Capital Cost $Mil. 10.0-45.0 .5 6.0 20.0-25.0 3.0 3.0-20.0 26.5-76.0 Operating Cost Down Up2 Down Down Up3 Up Up

Source: Arie van Donkelaar, Dial in Compliance: The Cluster Rules, March 1995. 1) Unlike other processes identified above, TCF includes a combination of the following processes, with substitution of hydrogen peroxide for chlorine: extended/modified or anthraquinone cooking, improved brownstock washing, and oxygen delignification. 2) When fiber or pulp prices rise to the levels such as in 1995, the larger pulp yield (increased productivity) induced by anthraqinone overcome the high chemical cost, and operating costs go down. 3) When compared to conventional peroxide bleaching, operating costs go down.

V-72
Table V-A.4: (NOTES ON THE RADIAN ANALYSIS) Radian Bleached Kraft Group Types Radian Type 1 2 3 4 5 6 Typical bleaching sequence CEH CdEHD DcEoDED ODEoDD CdEopDD OCdEdD Representative mill defining characteristics Traditional, no ClO 2 on-site Traditional, some ClO 2 on-site High ClO 2 substitution; no hypochlorite O2 Delignification; High ClO 2 Subst. Extended Cooking; High ClO 2 Subst. O2 Delign. & Ext Cooking; Low ClO 2 Sub U.S. Mills 93 8 41 11 6 11 8

Radian grouped kraft bleached mills into these six categories and selected a representative mill from the USEPA 1993 study. Three Great Lakes mills do not fit well in the Radian categories. This affects the operating cost estimates, and thereby the comparisons between each scenario: *E.B. Eddy and Champion have added extended/modified cooking, but also have substantial ClO2 investments, unlike the representative mill used by Radian to make the estimates for Type 6. Consequently, we assigned these mills to group 4, which more closely represents the capital expenditures. The operating costs are likely to be lower for Eddy and Champion than the group 4 estimates for scenarios 2 and 3 due to the advantages that extended/modified cooking contributes. For example, anthraquinone is unnecessary and less bleaching chemicals will be needed due to the greater delignification. *International Papers mill is the only one of two soda mills in the U.S. Kraft sulphate mills developed out of soda mills. The U.S. EPA proposed cluster rules classifies soda mills with kraft mills for regulation, due to process similarities. Economic comparisons are not likely to be as similar. Due to the confidentiality of certain mill processes and economic data, we could not make direct estimates for each mill. The U.S. EPA provided confidential mill technological and economic data which Radian used to estimate conversion costs. They were unable to reveal the representative mills identity or detailed data. Each Great Lake chemical mill will have particularities which will result in different actual costs. But generally comparisons between each scenario should be informative, except in the case of operating expenses noted in the cases of the three mills noted above. Adaptation of the Radian Analysis: The Radian Corporation (1995) has investigated the costs that various types of kraft mills would incur in order to achieve an chlorine dioxide ECF bleaching sequence recommended by the U.S. EPA (oxygen delignification, 100% substitution of chlorine dioxide for elemental chlorine, and the use of hydrogen peroxide in the extraction stage). Radian has also investigated the cost of an alternative ECF-3 sequence in which chlorine dioxide is applied in a late stage rather than an early one (as in the case of ECF-2). For that purpose Radian has identified several characteristic types of existing pulp-making and bleaching sequences and for each of them has estimated the cost of the additional capital and changes in operating and maintenance expenditures that would be needed for a transition to the two alternative ECF sequences. The additional capital costs were normalized to a standard mill size of 550 metric ton per day. Using these data we have estimated the incremental cost of these transitions for each of the nine kraft and soda mills listed in Table V-5. For this purpose each mill was assigned to the appropriate Radian type depending on the existing bleaching sequence. Then, as shown, for example, in Tables VA5(1-3), the increased capital cost appropriate to each mill was estimated in two steps. First, the capital

V-73
cost estimated by Radian for a standard 550 metric tons of air-dried pulp (tpd) plant was adjusted to take into account needed equipment that was already in place at each mill. Thus, several mills in Type 3 already have installed some capacity for hydrogen peroxide use, representing a savings of $225,000 (on the scale of 550 tpd) in the cost of this equipment. This adjusted capital cost was then further adjusted to reflect the actual size of the mill, in comparison with the standard 550 tpd mill. This involved the use of a scaling factor based on the ratio of the actual mill size to the 550 tpd standard, raised to the power of 0.6. (This exponent is derived from Radian estimates, based on the economy of scale due to the equipment characteristics.) It is then possible, as shown in Table V-A5(1), to estimate the additional capital required to bring each of the Great Lakes kraft pulp mills to an EPA-recommended bleaching sequence (ECF-2). Finally, this value was converted to an annual cost, based on amortizing this investment at 10% over a 15-year period. This figure is used to compute the increased capital cost per metric ton (of air-dried pulp), which, together with Radians estimate of the added operating and maintenance cost per metric ton, yields the overall increment in each mills cost of pulp production due to the conversion to ECF-2. The next scenario ECF-3 was adopted in a similar manner as shown in Table V-A5(2). The advanced low effluent TCF scenario was adopted from ECF-3 and is shown in Table VA5(3). Essentially this TCF scenario uses the same capital equipment, but substitutes the use of hydrogen peroxide for chlorine dioxide in the last stage. Generally, greater quantities of hydrogen peroxide will be needed than chlorine dioxide in order to achieve the same brightness. Following International Paper as a high end estimate (Lancaster et al., 1992), a retrofitted mill could use up to $10.49 more in chemical costs per metric ton of pulp than ECF-3 (adjusting for chemical price differences since 1992). On the low end, mills with extended or modified delignification digesters would expect no significant differences (e.g., E.B. Eddy and Champion) in costs. Mills with difficult to bleach wood furnish and other suboptimal equipment, would have the high end. Since we did not have detailed information for each mill in these respects, we did not customize the operational cost differences of TCF for each mill, and used the higher estimate for a conservative analysis of TCF.

TABLE V-A.5(1):

Great Lake Kraft & Soda Mills Conversion Costs Radian: MODERN ECF-2
Technology: Oxygen Delignification, Chlorine Dioxide-Elementary Chlorine Free

PULP OUTPUT (METRIC) RADIAN GROUP FACILITY NAME CANADA Avenor (former CPFP) 3 3 E.B. Eddy 4 4 James River- Marathon Kimberly-Clark 3 3 3 UNITED STATES Champion International International Paper Co. Mead Corp. 4 2 3 3 Potlatch Corp. 3 3 S.D. Warren Co. (Scott) 2 1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H 8,669 1.00 1.33 1.25 1.40 0.34 0.83 0.59 1,600,000 18,500,000 12,000,000 12,000,000 12,000,000 12,000,000 18,500,000 755 S 755 H-S 500 S 500 H 499 S 880 S 380 H 1.21 1.21 0.94 0.94 0.94 1.33 0.80 12,000,000 12,000,000 1,600,000 1,600,000 12,000,000 12,000,000 12,000,000 TYPE TONS PER DAY) ECONOMY SCALING FACTOR (1) RADIAN DATA

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT TO RADIAN DATA ADJUSTED CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

225,000 225,000 0 0 225,000 225,000 225,000

11,775,000 11,775,000 1,600,000 1,600,000 11,775,000 11,775,000 11,775,000

14,240,049 14,240,049 1,511,069 1,511,069 11,106,597 15,611,078 9,432,210

1,872,193 1,872,193 198,666 198,666 1,460,226 2,052,447 1,240,088

6.89 6.89 1.10 1.10 8.13 6.48 9.06

-4.28 -4.28 4.25 4.25 -4.28 -4.28 -4.28

2.61 2.61 5.35 5.35 3.85 2.20 4.78

1,375,000 225,000 0 0 0 0 0

225,000 18,275,000 12,000,000 12,000,000 12,000,000 12,000,000 18,500,000

225,000 24,303,155 14,955,074 16,779,046 4,069,900 9,900,460 10,872,721 148,757,478

29,582 3,195,228 1,966,200 2,206,005 535,085 1,301,651 1,429,478 19,557,707

0.08 10.03 6.88 6.37 16.38 9.06 17.51 6.27 7.54

0.00 -3.69 -4.28 -4.28 -4.28 -4.28 -3.69 -2.71 -3.59

0.08 6.34 2.60 2.09 12.10 4.78 13.82 3.56 3.95

TOTALS & WEIGHTED AVERAGES Without Champion & E.B. Eddy

& M: Operating and Maintenance Costs; H: Hardwood; S: Softwood ** These are fixed costs which do not vary significantly with plant size. Values displayed here are not rounded to significant digits in order to make calculations transparent.

TABLE V-A.5(2):

Great Lake Kraft & Soda Mills Conversion Costs Radian: ADVANCED LOW EFFLUENT ECF-3
Technology: Oxygen Delignification, Medium Consistency Ozone Bleaching, Chlorine Dioxide-Elementary Chlorine Free

PULP OUTPUT (METRIC) RADIAN GROUP FACILITY NAME CANADA Avenor (former CPFP) 3 3 E.B. Eddy 4 4 James River- Marathon Kimberly-Clark 3 3 3 UNITED STATES Champion International International Paper Co. Mead Corp. 4 2 3 3 Potlatch Corp. 3 3 S.D. Warren Co. (Scott) 2 1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H 8,669 1.47 1.33 1.25 1.40 0.34 0.83 0.59 7,200,000 21,200,000 17,300,000 17,300,000 17,300,000 17,300,000 21,200,000 755 S 755 H-S 500 S 500 H 499 S 880 S 380 H 1.21 1.21 0.94 0.94 0.94 1.33 0.80 17,300,000 17,300,000 7,200,000 7,200,000 17,300,000 17,300,000 17,300,000 TYPE TONS PER DAY) ECONOMY SCALING FACTOR (1) RADIAN DATA

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT TO RADIAN DATA ADJUSTED CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

-225,000 -225,000 0 0 -225,000 -225,000 -225,000

17,075,000 17,075,000 7,200,000 7,200,000 17,075,000 17,075,000 17,075,000

20,649,582 20,649,582 6,799,812 6,799,812 16,105,745 22,637,721 13,677,706

2,714,879 2,714,879 893,997 893,997 2,117,483 2,976,267 1,798,260

9.99 9.99 4.97 4.97 11.79 9.39 13.15

-6.95 -6.95 8.21 8.21 -6.95 -6.95 -6.95

3.04 3.04 13.18 13.18 4.84 2.44 6.20

0 -225,000 0 0 0 0 0

7,200,000 20,975,000 17,300,000 17,300,000 17,300,000 17,300,000 21,200,000

10,571,916 27,893,772 21,560,232 24,189,791 5,867,439 14,273,163 12,459,550 224,135,823

1,389,930 3,667,300 2,834,605 3,180,323 771,414 1,876,547 1,638,104 29,467,983

3.70 11.52 9.92 9.19 23.62 13.06 20.06 9.44 10.60

8.21 -5.75 -6.95 -6.95 -6.95 -6.95 -1.36 -3.11 -5.56

11.91 5.77 2.97 2.24 16.67 6.11 18.70 6.33 5.04

TOTALS & WEIGHTED AVERAGES Without Champion & E.B. Eddy NOTES: (1) (output/550)^0.6

(2) O&M: Operating and Maintenance Costs, H: Hardwood, S: Softwood Values displayed here are not rounded to significant digits in order to make calculations transparent.

TABLE V-A.5(3):

Great Lake Kraft & Soda Mills Conversion Costs Radian: ADVANCED LOW EFFLUENT TCF
Technology: Oxygen Delignification, Medium Consistency Ozone Bleaching, Hydrogen Peroxide-Totally Chlorine Free

PULP OUTPUT (METRIC) RADIAN GROUP FACILITY NAME CANADA Avenor (former CPFP) 3 3 E.B. Eddy 4 4 James River- Marathon Kimberly-Clark 3 3 3 UNITED STATES Champion International International Paper Co Mead Corp. 4 2 3 3 Potlatch Corp. 3 3 S.D. Warren Co. (Scott) 2 1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H 8,669 1.47 1.33 1.25 1.40 0.34 0.83 0.59 7,200,000 21,200,000 17,300,000 17,300,000 17,300,000 17,300,000 21,200,000 755 S 755 H-S 500 S 500 H 499 S 880 S 380 H 1.21 1.21 0.94 0.94 0.94 1.33 0.80 17,300,000 17,300,000 7,200,000 7,200,000 17,300,000 17,300,000 17,300,000 TYPE TONS PER DAY) ECONOMY SCALING FACTOR (1) RADIAN DATA

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT TO RADIAN DATA ADJUSTED CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

-225,000 -225,000 0 0 -225,000 -225,000 -225,000

17,075,000 17,075,000 7,200,000 7,200,000 17,075,000 17,075,000 17,075,000

20,649,582 20,649,582 6,799,812 6,799,812 16,105,745 22,637,721 13,677,706

2,714,879 2,714,879 893,997 893,997 2,117,483 2,976,267 1,798,260

9.99 9.99 4.97 4.97 11.79 9.39 13.15

3.52 3.52 18.68 18.68 3.52 3.52 3.52

13.51 13.51 23.65 23.65 15.31 12.91 16.67

0 -225,000 0 0 0 0 0

7,200,000 20,975,000 17,300,000 17,300,000 17,300,000 17,300,000 21,200,000

10,571,916 27,893,772 21,560,232 24,189,791 5,867,439 14,273,163 12,459,550 224,135,823

1,389,930 3,667,300 2,834,605 3,180,323 771,414 1,876,547 1,638,104 29,467,983

3.70 11.52 9.92 9.19 23.62 13.06 20.06 9.44 10.60

18.68 4.72 3.52 3.52 3.52 3.52 9.11 7.36 4.91

22.38 16.24 13.44 12.71 27.14 16.58 29.17 16.80 15.51

TOTALS & WEIGHTED AVERAGES Without Champion & E.B. Eddy

NOTES: (1) (output/550)^0.6 (2) O&M: Operating and Maintenance Costs, H: Hardwood, S: Softwood Values displayed here are not rounded to significant digits in order to make calculations transparent.

TABLE V-A.6(1):

Great Lake Kraft & Soda Mills Conversion Costs Paper Task Force: ADAPTED TRADITIONAL ECF-1
Technology: Chlorine Dioxide-Elementary Chlorine Free

PAPER TASK FORC GROUP TYPE CAPITALFACILITY NAME CANADA Avenor (former CPFP) 1 3 E.B. Eddy 3 3 James River- Marathon Kimberly-Clark 2 1 3 UNITED STATES Champion International International Paper Co. Mead Corp. 4 3 1 3 Potlatch Corp. 2 3 S.D. Warren Co. (Scott) 2 O & M (2)

PULP OUTPUT (METRIC) TONS PER DAY) ECONOMY SCALING FACTOR (1) PAPER

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT ADJUSTED TO PTF DATA CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

TASK FORCE DATA

755 S 755 H-S 500 S 500 H 499 S 880 S 380 H

NC NC 1.00 1.00 NC 0.93 0.85

NC NC 18,000,000 16,800,000 NC 28,900,000 16,800,000

NC NC 0 0 NC 0 0

NC NC 18,000,000 16,800,000 NC 28,900,000 16,800,000

NC NC 18,000,000 16,800,000 NC 26,766,245 14,249,428

NC NC 2,366,528 2,208,759 NC 3,519,059 1,873,426

NC NC 13.15 12.27 NC 11.11 13.69

NC NC 8.70 6.40 NC 8.70 6.40

NC NC 21.85 18.67 NC 19.81 20.09

1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H 8,669

NC 1.41 0.87 1.48 0.36 0.87 0.62

NC 16,800,000 28,900,000 16,800,000 NC NC 18,000,000

NC 0 0 0 NC NC 0

NC 16,800,000 28,900,000 16,800,000 NC NC 18,000,000

NC 23,656,482 25,160,704 24,873,157 NC NC 11,201,460 160,707,476

NC 3,110,207 3,307,973 3,270,168 NC NC 1,472,698 21,128,819

NC 9.77 11.58 9.45 NC NC 18.04 11.45

NC 6.40 8.70 6.40 NC NC 8.70 7.48

NC 16.17 20.28 15.85 NC NC 26.74 18.93

TOTALS & WEIGHTED AVERAGES

: Type 1 & 4: (output/1000)^0.6; Type 2 & 3 (output/500)^.6 (2) O&M: Operation and Maintenance Costs. H: Hardwood; S: Softwood. NC: No Change. PTF: Paper Task Force Values displayed here are not rounded to significant digits in order to make calculations transparent.

TABLE V-A.6(2):

Great Lakes Kraft & Soda Mills Conversion Costs Paper Task Force: MODERN ECF-2
Technology: Oxygen Delignification, Chlorine Dioxide-Elementary Chlorine Free Bleach

PAPER TASK FORC GROUP TYPE CAPITALFACILITY NAME CANADA Avenor (former CPFP) 1 1-3 E.B. Eddy 4 4 James River- Marathon Kimberly-Clark 2 1 3 UNITED STATES Champion International International Paper Co.* Mead Corp. 4 1-3 1 1-3 Potlatch Corp. 2 3 S.D. Warren Co. (Scott) 2 O & M (2)

PULP OUTPUT (METRIC) TONS PER DAY) ECONOMY SCALING FACTOR (1) PAPER

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT ADJUSTED TO PTF DATA CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

TASK FORCE DATA

755 S 755 H-S 500 S 500 H 499 S 880 S 380 H NC NC

0.84 0.84

35,800,000 35,800,000 NC NC NC NC

0 0

35,800,000 35,800,000 NC NC

30,244,833 30,244,833 NC NC 25,068,563 33,156,802 21,289,324

3,976,402 3,976,402 NC NC 3,295,859 4,359,250 2,798,988

14.63 14.63 NC NC 18.35 13.76 20.46

-2.40 1.70 NC NC -2.00 -2.40 1.70

12.23 16.33 NC NC 16.35 11.36 22.16

1.00 0.93 0.85

25,100,000 35,800,000 25,100,000

0 0 0

25,100,000 35,800,000 25,100,000

1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H

NC 0.93 0.87 0.98 0.36 0.87 0.62

NC 35,800,000 35,800,000 35,800,000 25,100,000 25,100,000 25,100,000

NC 0 0 0 0 0 0

NC 35,800,000 35,800,000 35,800,000 25,100,000 25,100,000 25,100,000

NC 33,258,749 31,167,931 34,969,278 9,013,881 21,927,213 15,619,813 285,961,222

NC 4,372,653 4,097,766 4,597,543 1,185,089 2,882,854 2,053,596 37,596,402

NC 13.73 14.34 13.28 36.29 20.06 25.15 15.76

NC 1.70 -2.40 1.70 -2.00 1.70 -2.00 -0.26

NC 15.43 11.94 14.98 34.29 21.76 23.15 15.50

TOTALS & WEIGHTED AVERAGES 8,669 : Type 1 & 4: (output/1000)^0.6; Type 2 & 3 (output/500)^.6 (2) O&M: Operation and Maintenance Costs. H: Hardwood; S: Softwood. NC: No Change. PTF: Paper Task Force Values displayed here are not rounded to significant digits in order to make calculations transparent.

TABLE V-A.6(3):

Great Lake Draft & Soda Mills Conversion Costs Paper Task Force: ADVANCED LOW EFFLUENT ECF-3
Technology: Oxygen Delignification, High Consistency Ozone Bleaching, Chlorine Dioxide - Elementary Chlorine Free

PAPER TASK FORC GROUP TYPE CAPITALFACILITY NAME CANADA Avenor (former CPFP) 1 1-3 E.B. Eddy 4 4 James River- Marathon Kimberly-Clark 2 1 3 UNITED STATES Champion International International Paper Co. Mead Corp. 4 1-3 1 1-3 Potlatch Corp. 2 3 S.D. Warren Co. (Scott) 2 O & M (2)

PULP OUTPUT (METRIC) TONS PER DAY) ECONOMY SCALING FACTOR (1) PAPER TASK FORCE DATA

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT ADJUSTED TO PTF DATA CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

755 S 755 H-S 500 S 500 H 499 S 880 S 380 H

0.84 0.84 0.66 0.66 1.00 0.93 0.85

50,800,000 50,800,000 15,000,000 15,000,000 35,000,000 50,800,000 35,000,000

0 0 0 0 0 0 0

50,800,000 50,800,000 15,000,000 15,000,000 35,000,000 50,800,000 35,000,000

42,917,250 42,917,250 9,896,309 9,896,309 34,956,164 47,049,316 29,686,309

5,642,493 5,642,493 1,301,105 1,301,105 4,595,819 6,185,751 3,902,971

20.76 20.76 7.23 7.23 25.59 19.53 28.53

-1.70 5.70 0.60 0.60 -1.10 -1.70 5.70

19.06 26.46 7.83 7.83 24.49 17.83 34.23

1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H 8,669

1.03 0.93 0.87 0.98 0.36 0.87 0.62

15,000,000 50,800,000 50,800,000 50,800,000 35,000,000 35,000,000 35,000,000

0 0 0 0 0 0 0

15,000,000 50,800,000 50,800,000 50,800,000 35,000,000 35,000,000 35,000,000

15,386,154 47,193,979 44,227,120 49,621,210 12,569,157 30,575,795 21,780,616 438,672,939

2,022,876 6,204,771 5,814,707 6,523,888 1,652,515 4,019,915 2,863,580 57,673,988

5.39 19.49 20.35 18.85 50.60 27.97 35.07 18.48

0.60 5.70 -1.70 5.70 -1.10 5.70 -1.10 1.78

5.99 25.19 18.65 24.55 49.50 33.67 33.97 20.26

TOTALS & WEIGHTED AVERAGES

: Type 1 & 4: (output/1000)^0.6; Type 2 & 3 (output/500)^.6 (2) O&M: Operation and Maintenance Costs. H: Hardwood; S: Softwood. NC: No Change. PTF: Paper Task Force Values displayed here are not rounded to significant digits in order to make calculations transparent.

TABLE V-A.6(4):

Great Lake Draft & Soda Mills Conversion Costs Paper Task Force: ADVANCED LOW EFFLUENT TCF
Technology: Oxygen Delignification, High Consistency Ozone Bleaching, Hydrogen Peroxide Bleaching-Totally Chlorine Free

PAPER TASK FORC GROUP TYPE CAPITALFACILITY NAME CANADA Avenor (former CPFP) 1 1-3 E.B. Eddy 4 4 James River- Marathon Kimberly-Clark 2 1 3 UNITED STATES Champion International International Paper Co.* Mead Corp. 4 1-3 1 1-3 Potlatch Corp. 2 3 S.D. Warren Co. (Scott) 2 O & M (2)

PULP OUTPUT (METRIC) TONS PER DAY) ECONOMY SCALING FACTOR (1) PAPER

CAPITAL COST (US$) AVERAGE ADJUSTED FOR SCALE ADJUSTMENT ADJUSTED TO PTF DATA CAPITAL COST TOTAL FIXED ANNUAL PER METRIC TON O&M PER METRIC TON (2) TOTAL PER METRIC TON

TASK FORCE DATA

755 S 755 H-S 500 S 500 H 499 S 880 S 380 H

0.84 0.84 0.66 0.66 1.00 0.93 0.85

52,800,000 52,800,000 17,000,000 17,000,000 36,300,000 52,800,000 35,000,000

0 0 0 0 0 0 0

52,800,000 52,800,000 17,000,000 17,000,000 36,300,000 52,800,000 35,000,000

44,606,905 44,606,905 11,215,817 11,215,817 36,254,536 48,901,651 29,686,309

5,864,638 5,864,638 1,474,586 1,474,586 4,766,521 6,429,285 3,902,971

21.58 21.58 8.19 8.19 26.54 20.29 28.53

-2.20 4.00 0.10 0.10 -1.50 -2.20 4.00

19.38 25.58 8.29 8.29 25.04 18.09 32.53

1,043 H 885 H 794 S 962 H 91 S 399 H 227 S-H

1.03 0.93 0.87 0.98 0.36 0.87 0.62

17,000,000 50,800,000 50,800,000 50,800,000 36,300,000 36,300,000 36,300,000

0 0 0 0 0 0 0

17,000,000 50,800,000 50,800,000 50,800,000 36,300,000 36,300,000 36,300,000

17,437,641 47,193,979 44,227,120 49,621,210 13,036,012 31,711,468 22,589,611 452,304,981

2,292,593 6,204,771 5,814,707 6,523,888 1,713,894 4,169,226 2,969,941 59,466,244

6.10 19.49 20.35 18.85 52.48 29.01 36.38 19.05

0.10 4.00 -1.50 4.00 -1.50 4.00 -1.50 0.89

6.20 23.49 18.85 22.85 50.98 33.01 34.88 19.94

TOTALS & WEIGHTED AVERAGES 8,669 : Type 1 & 4: (output/1000)^0.6; Type 2 & 3 (output/500)^.6 (2) O&M: Operation and Maintenance Costs. H: Hardwood; S: Softwood. NC: No Change. PTF: Paper Task Force Values displayed here are not rounded to significant digits in order to make calculations transparent.

V-81 Table V-A.7: TCF Operational Cost Competitiveness with ECF Scenario 3a: Capital and operational cost competitive with best ECF but lower brightness Scenario 3b: Operational cost and brightness competitive with best ECF, but additional capital expenditure for retrofits

PARAMETER Bleaching Sequence Brightness %ISO AOX kg/metric ton pulp Total chemical costs US$/metric ton pulp* 1) incl. ClO 2 capital costs 2) excl. ClO 2 capital costs

Scenario 1 Modern ECF-1 ODEopD(ED) 90 0.80

Scenario 2 Advanced ECF-2B OAZEopD 90 0.05

Scenario 3A Advanced TCF-A OAZEopP 82 0.00

Scenario 3B AdvancedTCF TCF-B OQP(ZQ)(PO) 90 0.00

28 21

25 20

22 22

20 20

Notes: See Tables V-1 and V-5 for abbreviations. ClO 2: Chlorine dioxide; A: Acid stage; Q: Metal chelating stage. * Oxygen delignification precedes each scenario with identical costs (US$1.30/metric ton pulp) and is not included in chemical costs comparison presented in table. * Ozone capital costs included in its chemical costs (US$1.56/kg) for purposes of comparisons. Chlorine dioxide costs are calculated for two cases: 1) Capital costs included - reflects the cost comparisons for a mill without ClO 2 capacity. 2) Capital costs excluded - reflects the cost comparisons for a mill with preexisting ClO 2 capacity. Costs calculated for 1000 metric ton pulp per day mill. Source: Thomas R. Govers, Air Liquide, Ozone in the Pulp Mill: Alternatives and Cost, Proc. Intl Nonchlorine Bleaching Conf., March 1994.