She can live without us, we cannot.

Responsible Manufacturing and Sustainability – ITC’s Paper & BoardsSustainability ITC s Paper & Boards

Business

S.N.Venkataraman ITC LTD PSPD

Email-sn.venky@itc.iny@

AgendaIndustry ScanSustainability Challenges.

Fiber sourceEnergyEnergyWaterSolid waste managementCleaner Technologies

ITC Approach to challenges

Global Paper IndustryTotal market of 400 million tons per annum CAGR of 4.5%

Higher growth in emerging g g g gmarkets, particularly Asia

Expected to grow at 4% pa in the next three years (RISI)next three years (RISI)

33

29

710

21

Container BD Tissue NP P & W Pkg Bd

Indian Paper Industry Total Market ~ 10.2 Million Tons Per Annum Growing at ~ 7% p.a. Value added segment growing at ~ 15% p.a.

19% 3%

26%19%

14%7%

31%

Kraft Pkg Bd Others P & W NP Spl

M th & F t b t PMyths & Facts about Paper Making Paper cuts trees Paper comes from responsibly

managed plantationsmanaged plantations

Paper is bad for the environment

Comes from a natural and renewable crop – forest

Paper consumes a lot of

products help store 540 Mn Tons of CO2 every year 13 KWH of electricity is used to make 10 kg of paper ourenergy to make 10 kg of paper - our per capita consumption = powering a computer continuously for 4 days

Paper has a high carbon footprint

Carbon footprint is reducing year on year due to increasing plantations ( sequester carbon) and use of biomass & renewable energy

Major Challenges for j gSustainable Manufacture

Fiber SourceWaterEnergySolid Waste ManagementSolid Waste ManagementClean Technologies

Fiber Source

Sourcing of Wood; Global practiceForests are owned by people, fi G tfirms or Govt.Forests owned by companies –captive forestGovt. forest leased to companies – concession forestsGovt. forest managed by govt. – open market sale, auction 64% of the forest is managed64% of the forest is managed

Source: All about paper; Green Rating project - CSE

Classification of Indian paper mills according to fiber so rce for paper

Indian Paper Industry - Fiber

according to fiber source for paper & Paperboard mfg.

65% of the paper produced in India65% of the paper produced in India is from non-wood sources.

www. ipma.co.in

S i f W d Ch llSourcing of Wood ChallengesIndian Industry needs about 8 million MT of wood/year.Demand by 2012-13 is estimated to be 9 million ton/YearTo generate 9 million ton/year requires 2.5 million Ha of land to maintain ecological balance.No government policy in place for future wood supplyNo private forest for sustainable wood supplyN ll ti f t l d f P I d t t d lNo allocation of waste land for Paper Industry to develop sustainable wood source.

www. ipma.co.in

Wood supply is from

Sourcing of Wood Challenges

Farm forestry from small and marginal farmersSocial forestry, andy,Government supplies

Waste paper mills do not have downstream integration or partnership for fiberintegration or partnership for fiber.

Waste paper is mainly imported

Carbon Credits – Not viable, for issues like

Sourcing of Wood: Other Challenges

land ownershipMonitoringUNFCCC protocol criteria needsUNFCCC protocol criteria needs

(a) Land should not be under forest from1989 onwards for reforestation projectsL d h ld t b d f t f 1950 d f(b) Land should not be under forest from 1950 onwards for afforestation projects (farm forestry with farmers)

1 million ton/year of waste i d hi h

Sourcing of Waste Paper Challenges

paper is recovered which works out to be 20%. Potential for recovering 4

illi t / I I dimillion ton/year. In India, no institutional set up for recycling of waste paper.60% of the waste paper required is imported.Cost of imported waste paper is high due to non availability.

Source: All about paper; Green Rating project - CSE

Water

Paper Industry - Mass BalanceAverage Indian Mill

INPUT: 124 TONS Conversion Efficiency=0.80%

Wood / Fiber Losses: 7 TONS

y

Wood / Fiber1.9 MT

Water120 MT

Gaseous Emissions

OUTPUT: 1 TON

Vapor Loss

Losses: 7 TONS

120 MT

Fuel1.6 MT

Paper

PAPER MAKING PROCESS

Chemical0.50 MT

Waste

Waste: 116TONS

Waste Water Solid Waste

High Consumption is due to:

Water Management Challenges

Bleaching & paper making process together consume 71% of total water consumption.Sp. water consumption of an Indian mill is 120m3/MT p pagainst the global best of 40m3/MT

Energy

Energy Management European Paper mill Indian Paper mill

# Swedish pulp and paper Industry meets 83% of it’s energy demand through waste biomass. In India, higher dependence on fossil fuel increases GHG emissions and higher waste generation. # Avg. Energy consumption for an Indian Mill is 50GJ/BDMT, twice the European bestSource: All about Paper, Centre for Science and Environment, Green Rating Project

ITC Approach

ITC Li it dITC LimitedThe only company in the world of its size to be

Carbon positive ( last 5 years ) Water positive ( last 8 years ) Waste Recycling Positive ( last 3 years )Waste Recycling Positive ( last 3 years )

Fiber Sourcing – ITC Approach

Sourcing of Wood: ITC Approach99.42% of Bhadrachalam mill’s total wood requirement in 2009-10 came from plantations under agro-forestry initiatives. Company has enabled a cumulative plantation coverage of 1,07,000 hectares as on 30th Sept 2010.Provided 48 million persondays of employment to tribals and marginal farmers

Sourcing of Wood: ITC ApproachDuring 2009-10, 2,082 hectares were brought under Social Forestry plantations, expanding the cumulative total to 16,442 hectares. The Social Forestry project to date has created sustainable livelihood opportunities for 19,376 poor h h ld h h dhouseholds who have earned an average of Rs31,000 per farmer This has led to a potential earning of 57,799 CER annually for 30 years under CDM–EB of the UNFCCC

In India more than 800 million people liveunder $ 2 a day according to World Bankdata. – ITC Sustainability Report 2009Source : ITC Sustainability Report 2010

Sourcing of Wood Fiber –ITC A hITC Approach

90127

1,00,000100000

120000Area planted (Hectares) from 1992 to 2009

65037

80152

90127

60000

80000

19579

29241

4089140000

60000

16 55 216 455 1245 2004 3207 4561 6139 858612773

19579

0

20000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

As on date we have covered more than 1,15,000 hectares under plantations

Sourcing of Wood Fiber –ITC A hGFTN is a WWF initiative to eliminate illegal logging and i th t f l bl d th t d

ITC Approach

improve the management of valuable and threatened forests, while encouraging sustainable forest management practices and minimizing the forest footprint of industries trading in or procuring forest goodstrading in or procuring forest goods.ITC’s Paperboards and Specialty Papers business, a pioneer in ECF technology, and the only producer of ozone-bl h d l i I di i b f WWF GFTNbleached pulp in India is now a member of WWF GFTN (World Wildlife Fund – Global Forest & Trade Network), since July 1, 2009.

Monitoring Sustainability of FiberThe ITC Plantations are

d i tmapped using remote sensing technique through National Remote Sensing Agency (NRSA)Agency (NRSA). The GIS data base is maintained for plantations to provide vital information onprovide vital information on periodic wood generation.

Source: ITC Sustainability Report 2008

Carbon Sequestration by ITC

CO2 Sequestration U it 03 04 04 05 05 06 06 07 07 08 08 0 09 10

qFigures

Unit 03‐04 04‐05 05‐06 06‐07 07‐08 08‐0 09‐10

CO2 released               (Manufacturing & 

Freight)Kilo Tonne 1013 1058 1202 1143 1352 1572 1709

Freight) 

CO2 Sequestration Kilo Tonne 311 906 1244 2025 2638 3695 4785

% 31 86 104 177 195 235 280

Source: ITC Sustainability Report 2010

Sourcing of Waste Paper - ITC ApproachOver 60% of all recycled fiber used in India is importedITC has initiated Wealth Out of Waste (WOW) campaign to recover the waste paper from households and corporate.Partnered with:

Local Governmental Authorities (Municipal Corporation)CorporateNGOs and Rag pickersNGOs and Rag pickers

In the process of developing a Supply chain to collect waste from households, segregation at source and transportation to the mill is arranged.the mill is arranged.

Water Management – ITC Approach

Water Management StandardsSpecific water consumption

Cubic meters per metric ton of paper production

ITC Bhadrachalam: Specific water consumption of mill for period April – Aug 2009

Source: National Productivity Council New DelhiSource: National Productivity Council, New DelhiFinal report on water conservation in pulp and paper sector.Table 14: Region/Country specific average water consumption in large scale wood based pulp and paper mills, (Page 48/115)h

Water Management at ITCWaste Water Discharge: Indian Standards

Standard Discharge (KL/MT)

CREP 100

Benchmark * 50

Best Achievable *

53

Relaxed Standard * 63

Bhadrachalam 53.9

Source: National Productivity Council, New DelhiFinal report on water conservation in pulp and paper sector.

Source: ITC Sustainability Report 2009y p

Quality of Waste Water:Ad b bl O i

Water Management at ITCAOX (K /T )Adsorbable Organic

Halides (AOX) have been reduced to a mere 0.0074 Kg/tonne of production

(Kg/Ton)

Bhadrachalam Mill 0.0074

Kg/tonne of production during 2008-09 against CREP guideline of 1.0 kg/ton by March 2009.

Indian Paper/Paperboards Mills*

0.46-0.8

European Paper Industries# 0.03kg/ton by March 2009.

World Bank Standard** 0.2

* Average as per Comprehensive Industry Document for Large Scale Paper Mills, study conducted by Central Pulp & Paper Research Institute, 2007

# Confederation of European Paper Industries- Sustainability Report 2007p p y p

** World Bank Guideline for New Paper MillsSource: ITC Sustainability Report 2009

33

Energy Management – ITC Approach

Energy Management at ITC

-Commissioning of Green Boiler will result in coal saving of 1,20,000MT/annum Post Green boiler,

2.5 Lac MT of biomass= 1.70Lac MT of coal equivalent of 4500kcal/kg GCV 1.70Lac MT of coal equivalent of 4500kcal/kg GCV = 2.9LacMT/Year of CO2 emission reduction

C ti t ITCCogeneration at ITC96% self sufficiency through cogenerationHigh pressure steam generation from recovery boilers for power generationAFBC boilers to fire low grade fuel at higher thermal g gefficiencyBack pressure and Extraction cum back pressure steam turbine combination to achieve higher efficiency. g yIsland mode operation to optimize generation frequency

Energy Management at ITC

(in GJ/BDMT)

Source: Indian: All About Paper, Green Rating Project, CSE – 2004, Page 191European Union (EU): European Commission, Reference document for Best Available Techniques in the Pulp & Paper Industry 2001 – Energy consumption for integratedTechniques in the Pulp & Paper Industry 2001 Energy consumption for integrated bleached Kraft mill, Page 89 ITC-BCM: Based on primary energy consumption for year 2008-09, International Paper: All About Paper, Green Rating Project, CSE – 2004, Page 192

C b C dit f ITCCarbon Credits for ITCRegistered 7 CDM projects with UNFCCC

6 projects from Energy Efficiency & Energy Conservation1 project from Social Forestryp j y

Potential to generate 18.5 Lac CERs over 10 year periodUNFCCC has issued 2.28 Lac CERs till date

Solid Waste – ITC Approach

Solid Waste Management

100% recycling of fly ash through brick manufacturing & cement manufacturing 100% recycling of lime sludge through supply to cement manufacturing

Solid Waste Management at ITCPlastic Waste:

Off site sorting of waste paper Recycling of plastics and metalsIn process equipments for separationIn process equipments for separation Development of entrepreneurship to recycle separated plastics

Clean Technologies at ITC

Clean Technologies

M/s Metso supplied high capacity chippers. Reduction in fines generation from 3.5%to less than 2%Reduction in chemical consumption for cooking due to uniform sized chips..

Clean TechnologiesOxygen Delignification

BLS recovered per ton of blown pulp increased from 1.7 to 2.1Increased biomass component in energy mixReduced water pollutionImprovement in pulp brightnessR d d bl hi h i lReduced bleaching chemicalsReduction of Kappa no. by 40%

Clean Technologies

M/s Metso supplied Fiberline First ECF Fiberline in IndiaFirst ECF Fiberline in IndiaFirst Lite ECF Fiberline with Ozone Bleaching

Clean TechnologiesOzone Bleaching: Colour effluent

46

Extending Sustainability through g y gour Products

FSC - Forest Stewardship Council headquartered in Bonn, G i i d d t t l t fGermany is an independent, non-governmental, not for profit organization established to promote responsible management of the world’s forests.

B th Bh d h l d K i it FSC C tifi d dBoth Bhadrachalam and Kovai units are FSC Certified and Tribeni and Bollaram will be certified within this year

FSC - Forest Management Certification is on and is expectedt b l t d thito be completed this year

Displaying our sustainability commitmentwww.itcgreenpapers.com

The website is a platform to discuss and understand sustainability and environmental topics relevant to the pulp, paper and packaging industry. The website also showcases our green operations and products. provides information to people looking for environmentally responsible paper and paperboards. www.itcgreenpapers.com will serve as an interactive tool, and will gradually expand to include Newsletters and Discussion Forumsgradually expand to include Newsletters and Discussion Forums.

WWF – Check Your Paper• Check Your Paper (CYP) is a user friendly tool designed by WWF to

facilitate transparency on environmental performance in the paper industry by helping the buyer in estimating the environmental footprint of the papers / paperboards they buy.

• ITC PSPD’s Unit Kovai has rated 2 of its products Coated Board Grey Back and Coated Board White Back on the website.

• The ratings can be viewed at http://checkyourpaper.panda.org/

Displaying our sustainability commitment

S stainable prod cts Biobarrier BoardsSustainable products - Biobarrier Boards

Introduction of Biopolymer Coated Papers for food and beverages especially paper cups Biopolymer coatingbeverages - especially paper cups. Biopolymer coating makes the cups biodegradable in a composting environment Poly Lactic Acid – Biodegradable biopolymer, Made from renewable sources (maize, wheat)( , )Properties are comparable to LDPEClassified as GRAS (Generally recognized As Safe) by FDA, US

Replacing 10 Million poly coated paper cups every month with PLA coated paper cups would lead to an overall Carbon Dioxide (CO2) reduction of approximately 220 Tons per year. This in turn translates to the followingEli i i h l l b f i ( l CO i iEliminating the total annual carbon footprint (annual CO2 emissions equivalents) from driving 40 passenger vehicles each year (million Kms in one year)

Our PLA based products under the umbrella brand of OmegaOur PLA based products under the umbrella brand of Omega provides a sustainable alternative to barrier coating.

www.natur-tec.com

Life Cycle Analysis – a tool to d istudy impacts

LCA studies for various products have been conducted in Europe for nearly 10 years and covers various impacts that a product has on the environment – land, water, air, plant, animal and human health.Usually commences with defining the scope of the study and the boundaries which can vary from Cradle to Gate , Cradle to Grave y ,and Cradle to CradleThe measure covers all raw material inputs , inward freight , processes , outputs, outward freight and further usage and disposaldisposalOnce these parameters are measured , weightages based on their impacts are given by a base inventory data which is then fed into a calculation mechanism to arrive at a single number –normally given as CO2 equivalentnormally given as CO2 equivalent.ITC has the ability to conduct LCA studies backed by software acquired from PE International. We have planned to use the tool to assess Paperkraft Copier and l f d t O l i LCA halso one more of our product . Our learning curve on LCA has

just now begun

Working together : between IndustriesArrive at norms for green products - especially paper paper cups and other related stationery other thanpaper, paper cups and other related stationery other than packaging Explore areas where recyclable waste can be responsibly disposed - for example our WOW programresponsibly disposed for example our WOW program Evolve green manufacturing technologies knowledge exchange programs in common areas of operations like -power, waste, effluents etc Nominate, procure and use higher rated products in rating systems like Greenco rating systemStart adopting LCA methodology in determining impacts p g gy g pof the products in the supply chain

Working together : Industry & Government Stipulate green credentials at the material level without any ambiguity encourage adoption of the Greenco ratingany ambiguity – encourage adoption of the Greenco rating and other recognised labelsEncourage products with the least impact on resources and that are sustainable and provide necessary incentivesand that are sustainable and provide necessary incentives

SummaryWaste Lands for Plantations

Industry / State PartnershipNational Recycle Drive

Public / Private partnershipPublic / Private partnershipEnergy and Water conservation Zero solid waste dumpingCleaner Technologies

54

$$$Money does grow on trees$$$with a bit of effortwith a bit of effort

Thank YouThank You