Credits for the Pulp and Paper Industry

December 15, 2009

The Canadian Pulp and Paper Industry has been adversely affected by the billions of dollars the US government provided to the US Pulp and Paper companies under the US government’s incentives for black liquor production, used to generate electricity.  (Black Liquor is a liquid by-product of the chemical pulping process that is used to generate renewable energy.)

Our pulp and paper companies could not compete with their US competitors because of this subsidy. Our Conservative government wanted to help Canadian companies without subsidizing their operations and have done so by announcing the allocation of credits to Canadian pulp and paper companies under the “Pulp and Paper Green Transformation Program (PPGTP)”. Through this program  mills in British Columbia qualify for significant amount of credits. These credits will be used to invest in capital projects that focus on improving environmental performance and energy efficiency of facilities.

The Pulp and Paper Green Transformation Program is providing pulp and paper mills across Canada with access to $1 billion in funding for capital investments that improve the energy efficiency of their facilities and encourage production of alternative energy from forest biomass. These funds are to be repaid through the cost saving resulting from the Greening Investment.

Tolko Industries has been awarded 13,357,389 in credits under the PPGTP for their Kraft Paper Mill in The Pas, Manitoba.  I had the privilege on November 9th to announce on behalf of the Minister of Natural Resources, the Honourable Lisa Raitt, a credit allocation of just over 57 million for the Pulp and Paper Mill in Castlegar.
Companies can use this credit for projects that support innovation and environmentally friendly investments in areas such as energy efficiency and renewable energy production at their mills.  For example, Pulp and Paper Mills can apply this credit towards taking forest biomass and converting it into electricity for their mill operations, which in turn will take the mill off the local power grid. In many cases excess electric capacity will be added onto the regional electric power grid.

There is a threefold benefit to the Pulp and Paper Green Transformation Program. First, it will result in an energy efficient operation that lessens the carbon foot print of the mill; second, it will help meet the growing electric needs of the regional power grid, and third, the building of these power generating plants will create much needed jobs.

This initiative and the projects that will stem from it are all part of our government’s Economic Action Plan which is going to help companies and workers through this economic slowdown. This program allows us to come out of these tough times more competitive and more environmentally responsible.

Colin Mayes, MP - Okanagan Shuswap