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Cheng Loong Corp.

Papermaker Turns Bad Rep into Pulp Fiction


The paper industry is notorious for consuming energy. But Taiwanese paper manufacturer Cheng Loong has voluntarily cut greenhouse gas emissions, joining the vanguard of Taiwan's green revolution.



Papermaker Turns Bad Rep into Pulp Fiction

By Ching-Hsuan Huang
From CommonWealth Magazine (vol. 369 )

Cheng Loong Corp. is Taiwan’s largest maker of industrial paper and corrugated containers, as well as its largest paper recycler. With waste paper making up ninety percent of the raw materials going into its products, Cheng Loong recycles 1.17 million tons of paper every year.

A green revolution has been taking place in the world of industry these last few years, and it is almost crucial that companies join green supply chains and become green partners to big international enterprises, if they want access to big-dollar orders.

Red-hot Apple Inc. relies on Cheng Loong for at least 85 percent of its global packaging needs – the packaging for the wildly popular iPod MP3 player was almost completely designed and manufactured by the papermaker. Even earlier, Cheng Loong for similar reasons became Nike’s main supplier of shoeboxes, providing the shoe company with tens of millions of shoeboxes each month. It is even a longstanding green partner of Sony, a company known for its stringent green supply chain requirements.

Cheng Loong’s green reputation is well earned – its recycling of 1.17 million tons of waste paper each year alone reduces enough waste paper incineration and forest cutting to save nearly 2 million tons in carbon dioxide emissions for the Earth.

Nonetheless, simply using recycled paper as its main raw material might earn Cheng Loong nothing more than a passing grade in the eco exams.

Becoming a Green Benchmark

Ultimately, it was standing out as the first Taiwanese company to meet ISO (International Organization for Standardization) 14001 standards for environmental management systems and then shining as the first in the world to meet ISO 14064 standards for greenhouse gas accounting and verification that confirmed Cheng Loong’s status as a true green benchmark.

There was a time before these achievements when Cheng Loong’s former chairman of the board was living in the Taipei suburb of Banciao, next to one of the papermaker’s plants. Every time he would look out the window and see black smoke rising from the plant’s smokestack, he would make a phone call to upbraid the crew in charge. He was angry because black smoke indicated incomplete combustion, which was not only bad for the environment, but wasteful as well.

Amidst all the recent commotion over global warming, Cheng Loong has voluntarily and under no pressure from clients or government taken the initiative in addressing the paper industry’s notorious reputation as one of the world’s six big energy-consuming industries. Starting with its Dayuan plant, which houses the company’s most complicated equipment, Cheng Loong began to conduct an inventory of its greenhouse gas emissions volumes in 2004. By 2005, it had succeeded in completing inventories of its headquarters and ten plant sites around Taiwan.

In performing these inventories, Cheng Loong did not look simply into a plant’s total electricity consumption and volume of coal burned by its boilers, but went as far as taking into account even the methane generated by forklifts, septic tanks, and wastewater treatment facilities. The results of these detailed inventories revealed that Cheng Loong as a whole was responsible for pumping a total of 1.28 million tons of greenhouse gases into the Earth’s atmosphere each year.

Having wrapped up the inventories, the papermaker then set its reduction targets.

“You must have data management when you demand progress. We had the data after the inventories,” says Cheng Loong president Tong-Ho Tsai, adding, “We hope for a reduction of three percent each year. This is a tough target. ”

3% Annual Reduction Target

Indeed, due to a 1.8 percent increase in its production volume, Cheng Loong managed to cut its carbon dioxide emissions by only 1.9 percent in 2006. Still, though the company missed its anticipated target of three percent, its energy consumption continued to decline another 4.6 percent, saving it almost NT$100 million, an amount equivalent to13 percent of its net profits after tax that year.

What’s more, if Cheng Loong were to put its carbon dioxide reduction volume on the carbon market at the going rate in the European Union, it would trade at a value upwards of NT$30 million.

In fact, even before it initiated its greenhouse gas inventories, Cheng Loong was never shy when it came to investing in energy efficiency and waste reduction.

Take, for instance, the NT$460 million it spent to install a biomass boiler. This facility burns biomass fuel such as waste wood and waste left over from the paper production process instead of coal or heavy fuel oil.

Prior to the installation of this boiler, Cheng Loong would pay an outside incineration company NT$1,500 per ton to burn the waste it generated through the paper manufacturing process. Besides eliminating this expense, the biomass boiler allows Cheng Loong to recover thermal steam for use in running its machinery. The facility now recovers three hundred tons of steam from waste materials every day, providing ten percent of the steam needed for the production process.

“We consider even waste paper valuable, not to mention other resources,” says D. M. Lee, manager of Cheng Loong’s safety, health and environmental protection division.

Cheng Loong’s experience goes to show that it is not an out-and-out zero-sum game when it comes to balancing environmental protection with a business’s pursuit of growth. This green leader is proving that environmentally friendly practices can help a business attract orders from demanding international companies, and generate substantial revenues and reduce costs as well.

Translated from the Chinese by Stan Blewett

Chinese Version: 全球第一張溫室氣體認證​​​​​​​