U.S. P&P Mills Investing in Energy-Related Projects

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The U.S. pulp and paper industry is "awash with energy-related projects," according to the latest research by Industrial Info Resources, (IIR) Sugar Land, Texas, USA. Companies are investing in projects that will add electrical generating capacity, increase equipment performance, reduce thermal energy consumption, and ultimately improve the cost structure of mill operations, IIR reports.

The research firm says it currently is tracking more than 75 active capital and maintenance projects at mills across the country that have a cumulative total investment value of more than $1.6 billion. Projects range in size and scope from a $500,000 boiler grate rebuild to a $285 million biomass boiler and 75-MW steam turbine project in Virginia.

Of all active projects, 54 have an investment value of $10 million or less. A total of 21 projects are between $10 million and $100 million. While only a handful of the overall project counts are valued at more than $100 million, those investments account for nearly 40% of total expenditures.

Six of the projects being researched are under construction and have a combined project value of $343 million, while 34 projects that are worth more than $262 million are slated to commence construction during the remainder of 2011. For 2012, plans call for the start of construction on 35 projects that are worth just more than $1 billion.

Mill owners are investing heavily in electrical generation projects, with plans to install nearly 20 new steam turbine generators by 2013, IIR continues. Turbines range in sizes from 5 to 75 MW, with a majority of the units being between 25 and 35 MW. Turbine installations are tied to $1.1 billion in expenditures. As for boiler projects, most of the new installation will utilize some form of biomass as the primary fuel. Moreover, nearly $100 million in project activity is geared toward boiler rebuilds, retrofits, and upgrades.