In practice: Stora Enso's cost-effective move to champion cross laminated timber

A new multi-million-euro investment looks set to transform packaging firm Stora Enso into a renewable materials company and the largest global producer of a low environmental impact timber solution to replace steel and concrete in construction projects.

Stora Enso expects two-thirds of energy consumption at its mills to come from biomass derived from burning wood bark

Stora Enso expects two-thirds of energy consumption at its mills to come from biomass derived from burning wood bark

The challenge

As more construction firms look to reduce their carbon footprint by sourcing alternative, low-carbon building materials, Europe’s largest forest-based products company Stora Enso is faced with increased demand to produce sustainable forms of timber.

Forecasts suggest that material demand in the construction sector will double by 2050, and many companies view cross laminated timber (CLT) solutions as the ideal replacement for carbon-intensive concrete and steel structures.

As Stora Enso seeks to expand into a market that has grown threefold in the past two years, it must do so in a cost-effective manner that doesn’t disrupt certified sourcing practices and a zero-waste ethos at its mills.

The solution

The company has announced a new €45m investment into a production line development that will make it the biggest supplier of CLT globally. The investment will boost Stora Enso’s volume capacity, adding 100k m3 annually.

Stora Enso is one of the only European companies to offer both CLT and laminated veneer lumber (LVL) solutions for construction firms. It has two production plants in Austria that support the production of the engineered wooden structural materials and the Nordic region is a strategic location for Stora Enso, as it provides easy delivery routes to the UK and Scandinavian nations – countries that are leading the charge in sustainable construction.

The new €45m investment will introduce a new CLT production line in Sweden, at Stora Enso’s Gruvön Mill. Production is scheduled for 2019 and will add extra capacity to the Gruvön saw mill, rather than replacing it.

The new CLT production line will run alongside current operations at the saw mill, providing a cost-effective solution to increase supply to the market.

Cost savings

The investment is expected to generate annual sales of €50m. This not only provides a one-year return on investment on the production line, but also exceeds the Wood Products Division’s industry profitability target, which issues a challenge for companies to generate a return on operating capital (ROOC) of 18%.

Stora Enso doesn’t have a targeted ROOC for the investment, but expects the new production line to “significantly” deliver more than an 18% ROOC.

Adding the CLT production line to the Gruvön mill means that Stora Enso doesn’t have to reroute its log supply or introduce new transportation and logistics routes, saving on logistic costs and transport emissions.

Additional benefits

As mentioned, Stora Enso expects to increase CLT production by 100k m3 annually. This adds extra load requirements for the logs sourced at the mill, but the company has used the investment as an opportunity to strengthen its sustainability credentials.

The company has a strict sourcing policy to ensure that all packaging products are made from Forest Stewardship Council (FSC) or Programme for the Endorsement of Forest Certification (PEFC) certified timber from nearby forests.

An increase in production would likely add to the amount of waste generated at the mill, but Stora Enso ensured that zero wood waste would be discarded at the CLT mill. All incoming wood will be utilised, and parts that cannot be used for building products manufacturing are redistributed to the wood chips production line for pulp and paper.

Any sawdust generated onsite will also be used for wood pellet production, while bark from the timber is used in bioenergy production at a dedicated combined heat and power (CHP) system in Austria. Overall, Stora Enso expects two-thirds of energy consumption at its mills to come from biomass derived from burning wood bark.

Stora Enso has a pre-existing policy of replanting trees for each one harvested, and this will be continued as part of the CLT expansion. The number of plants per hectare varies according to tree species and place of growth, but there are always more trees planted than harvested. CLT is made of spruce and this regeneration process will require approximately 2,000 plants per hectare.

CLT benefits

Stora Enso’s move to become the biggest supplier of CLT reflects a market shift that views sustainability as a desirable factor. CLT is produced from softwood timber and consists of sections that are laid across each other at right angles. This allows the panels to be designed to specific dimensions for items such as windows, doors, and plumbing, ventilation and wiring openings.

The main benefit of CLT is its lower embodied carbon footprint and quick construction time compared to traditional methods. Some projects can be completed six times faster than a standard build because of the panel construction process. The layered design process strengthens each panel or plank, making it a suitable substitute for steel or concrete.

Figures suggest that around one-third of all landfill waste comes from the construction sites, either from construction or demolition of a building. CLT is an offsite solution and modular aspects of buildings can be constructed at CLT mills if specified. As recycling is easier to implement in a factory environment, the widescale use of CLT could improve landfill rates from the construction sector.

CLT is also much lighter than traditional building products, which allows for reduced slab and improves the embodied carbon of a project as a result. CLT panels are also better insulators, reducing heating and insulation costs.

Users of CLT argue that the replanting of trees with saplings actually reverses the emissions from the harvesting process to create a negative CO2 balance.

 

Matt Mace


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