The forest is the base of Södra’s production, and its operation is based on the long-term growth of the forest. For production of pulp, wood products and biofuel, 18 million cubic metres of wood raw materials are required. Södra strives for sustainability in all its activities.

On a global basis, larger areas of forest would bind more carbon dioxide and contribute to solving the climate problem.

Södra takes raw materials from the forest in a sustainable manner that combines efficient wood production and strong environmental responsibility. The approach is long-term and comprises the entire production chain from planting, management and harvesting, via transportation and processing to the final product.

For Södra, sustainable development means showing respect for nature and striving for positive development of the economic, environmental and social issues which affect the Company.

Climate issue and Södra’s role

Emissions of greenhouse gases in the world are contributing to global warming. Consumption of oil, coal and natural gas are increasing the amount of carbon dioxide in the atmosphere.

Well-managed forests bind large amounts of carbon dioxide. Forest management based on the Swedish model in the world’s production forests would be positive for the carbon balance. The opportunities for growth and harvesting are greater in well-managed forest. As the world’s forests are often understocked, from a production perspective it would be appropriate to increase the wood supply. This would result in binding of carbon dioxide in larger forest areas. Increased harvesting makes it possible to use wood to replace products that would otherwise create carbon dioxide emissions during their production. Wood is renewable and can be used for construction material and fuel, often replacing fossil material.

During the past hundred years, growth in the Swedish forest and its ability to bind carbon dioxide has increased through efficient forest management, cleaning, harvesting and reforestation. Development is similar elsewhere in Scandinavia and Europe, but could be improved in many other parts of the world. Vast areas are deforested each year, and many areas are affected by widespread damage from insect infestation and forest fires. Sustainable forestry should be able to help turn this unfavourable trend, thus reducing the addition of carbon dioxide to the atmosphere.

Through careful forest management, Södra and its members contribute to reducing the amount of greenhouse gases emitted to the atmosphere. Projects are also running to address the climate change that is already underway. This involves adapting to a milder climate through selection of tree species for example, and management of insect infestation caused by climate-related changes in insect behaviour.

Södra’s carbon footprint

A company’s impact in the form of total emissions of greenhouse gases can be shown in its carbon footprint. The various greenhouse gases are recalculated to carbon dioxide equivalents, the unit that is used to indicate carbon footprints. Six times more carbon dioxide is bound in member forests than the total amount emitted from all Södra operations. The carbon bound in member forests represents more than four million tonnes of carbon dioxide per year.

The wood-based products produced by Södra and its customers also bind carbon, which remains in the products until they are consumed. The products can then be recycled, broken down biologically or burned, potentially replacing fossil fuel.

A sustainable operation

Environmental work is based on Södra’s environmental policy. The task of achieving objectives is run within the framework for the business system, including the environmental and energy management systems. Employees are trained so they can handle environmental issues in a responsible manner. Work is done in a line organisation where managers have overall responsibility.

Södra members own more than two million hectares of forest; many are actively involved in running their forests and have other values in addition to production. They are often interested in recreation, game management and nature conservation. Forest owners make their own decisions how to manage their forests and thus have a broad environmental perspective.

Key tools

Södra has many tools to support its members in their environmental work in the forest. Key amongst them are the green forestry plan, general consideration while harvesting and the requirement that harvesting personnel hold a green driving licence. Forest certification is the backbone of the process.

The best tool for combining production and environment needs on an individual estate is the green forestry plan. The plan divides the forest estate into four categories which show the areas where wood can be harvested and those that should be left for nature conservation purposes. Forest with high natural value can be protected by making a voluntary reserve or through compensation from the state.

Environmentally-certified contractors with green driving licences perform the harvesting. They are trained to closely observe valuable natural and cultural aspects in the environment, which includes saving conservation trees and leaving edge zones. Snags, or tall stumps, are also left to provide for creatures that need dead wood.

Many types of forest have high natural value: hardwood forests rich in species with waterways are home to an abundance of plant and animal species, as are heavily-grazed oak forests in cultivated land. The emphasis is to protect biological diversity.

One aspect of sustainable forestry is to minimise the risk of insect damage; preventative measures of this type are included in Södra’s forest management strategy.

Planting and management of clearings

Södra has long promoted efficient forest rejuvenation, which has resulted in various types of planting projects. Södra Odlarna has developed an improved container plant with strong viability.

Sustainable forestry and future access to raw materials assume good regrowth in the forest. Södra produces its own plants from selected seeds that grow into new forests. Södra wants to be able to continue harvesting the forest in future and maintain a rich and varied landscape.

An important aspect is managing the clearing after harvesting. If harvesting residues are removed, the organic material with the greatest nutrition (needles and twigs) is left or can otherwise be compensated by returning ash to the soil. Modifications are made to protect biological diversity.

Responsibility, accounting, auditing

Södra offers its employees stimulating assignments in a safe working environment. Community contacts at various levels are widespread, as is the dialogue with stakeholders. Södra also takes outdoor sport and leisure considerations into account in its forestry.

Södra takes a responsible approach to environmental processes and publically reports its results. The objective is to have highly-capitalised mills that are leaders in terms of technology, environment and profitability.

The process is reviewed by environmental auditors, with the result providing a basis for further improvements.

Certification of forestry

Södra offers members forestry certification in accordance with PEFC, which is an international standard for sustainable forestry. By committing to meet both the standard and Södra’s conservation policy, the forest owner agrees to manage his forest in an economically and ecologically sustainable manner. The member is also committed to following the green forestry plan for the estate. The certified area increased by more than 20,000 hectares during the year, and by year-end 64 per cent of the membership area was certified.

Wood storage and terminal handling

After the storms Gudrun and Per, large terminal stocks of storm-felled wood were built up. Many of the terminals have been cleared and work is underway to restore the storage sites. Studies show that the storage had very little environmental impact and caused no serious damage. Some terminals will be retained permanently in contingency for future storms.

Sustainable transportation

Transportation has a negative environmental impact and an ongoing effort is being made to minimise this effect. Efficient planning is helping eliminate unloaded trips. The vehicles use eco-class 1 diesel and biodegradable hydraulic oil, and rail is used instead of road where possible.

High demands on mills

Södra’s ambition is to exceed the community's expectations in terms of reduced environmental load. The business mainly affects the environment through discharges and emissions from pulp production and transportation. Other effects are comparatively minor but can be perceived as disturbing when noise and odour are involved. Södra’s objective is to go on reducing the environmental load as it has done in the past through technical improvements and other means.

The mills work under licence in accordance with Swedish and Norwegian environmental legislation. Södra runs 83 operations subject to licence and reporting requirements in Sweden and two in Norway. Discharges, emissions and resource utilisation are calculated every year and reported. The environmental impact of the pulp mills is low enough to meet the requirements for customers to label their products with the Nordic Swan ecolabel.

Södra Cell, Södra Timber and Södra Skog have traceability certificates from PEFC which enables them to supply certified products. A project was run later in the year to enable delivery of FSC Controlled Wood, which is a prerequisite for customers wanting FSC certification for their products.

Södra operations are run in accordance with the ISO 14001 environmental management system. This means the same requirements are met as in other eco-certified companies around the world. These certifications represent quality assurance in terms of competence and credibility.

Energy projects

A key goal is to utilise raw materials and energy efficiently. Södra is a net supplier of electricity and thus delivers more electrical energy than it consumes in production.

The energy programme is focussed on improving the efficiency of energy consumption at the mills, further refining biofuels and increasing the production of forest fuels.

The pulp mills, sawmills and other operations produce and/or utilise large quantities of energy. Much emphasis is put on utilising the mills’ surplus of process heat and this enables energy to be supplied in the form of electricity, biofuel and district heating to the local community.

Electricity certificates

Södra was allocated 1.4 million green electricity certificates for its electricity production in 2008. Electricity certificates are used as a means of increasing the amount of renewable energy in Sweden’s electricity production. Companies that produce renewable electricity are allocated certificates which they can then sell to help pay for their environmental work and technology development.

Energy an increasingly important by-product

Energy originates in the forest. Södra’s energy products are positive for the climate as they are a good alternative to fossil fuels. In 2008, Södra produced a tenth of Swedish renewable electricity.

On 1 January 2009, Södra started selling electricity directly to end consumers via a newly-started electricity company. The company primarily offers employees and members the chance to purchase green electricity produced at the pulp mills. Electricity from wind power will also be offered when production starts.

Heat is produced at pulp mills and sawmills in recovery boilers and steam boilers. The heat is sufficient for Södra’s own needs and also supplies several communities with district heating. In 2008, Södra supplied a total of 419 GWh of district heating.

Södra’s sulphate mills produce electricity from high-pressure steam from the recovery and bark boilers. This totalled 1,700 GWh during the year.

Biofuel

Södra produces biofuel in various ways. Mill by-products such as bark, sawdust and shavings are used mostly for pellets. Forest raw materials that can’t be used for saw logs or pulpwood become fuelwood. There are large quantities of peat in peat bogs in southern Sweden, which are harvested by Södra Skogsenergi in conjunction with landowners.

In 2008, 3.2 GWh of biofuel were delivered. Södra also delivered peat, which represents a better environmental alternative than coal, oil and natural gas.

Energy research and investments

Södra runs its own research and development projects as well as collaborating in external projects to increase the use of renewable energy. These projects include black liquor gasification and a project for replacing oil and carbon with lignin powder. Black liquor comes from Södra’s sulphate mills and includes substances such as lignin. As mills become even more energy efficient, part of the black liquor can be extracted in the form of lignin.

Södra Skog and Södra Cell are running a joint project to make better use of ash from production by returning it to the forest ecocycle where it helps compensate the minerals removed on harvesting.

Södra is investing continuously to increase its efficiency and thus reduce its environmental impact.

Environmental costs and investments

In 2008, Södra’s environmental costs amounted to SEK 119 million (114).

Environmental investments amounted to SEK 69 million (78) and energy investments to SEK 186 million (34).

Environmental investments involve pure environmental investments as well as the estimated environmental component of other investments.