AF&PA on the Issues
American Forest & Paper Association (AF&PA) members make essential paper and wood-based products that are used daily by people across the country and around the world — products that play an important role in literacy, education, hygiene, food safety, product marketing and protection and home and office construction. The forest products industry directly employs approximately 950,000 men and women and is built on principles of sustainability: producing recyclable products from a renewable resource. We are among the top 10 manufacturing sector employers in 45 states. We support market-based policies and regulations that foster economic growth, job creation and international competitiveness in this vital sector. We believe public policies are most effective when they meet the economic needs, environmental concerns and societal expectations of our diverse communities.
AIR PERMITTING PROBLEMS AND SOLUTIONS
Every five years, EPA must decide whether the National Ambient Air Quality Standards (NAAQS) are sufficiently protective of public health. With NAAQS having dropped closer to background levels, good economic and environmental projects are falling off the drawing board because they won’t qualify for a permit. To prevent further ratcheting, EPA should not lower standards further unless there is compelling and indisputable evidence of additional health as air quality will continue to improve under current programs. The decline of permit submittals to states is a strong indication of this problem.
AF&PA is pleased EPA is making progress toward reducing the number of projects that need to go through the six to 18 month New Source Review process for new or updated facilities. The use of more realistic modeling assumptions and tools for those projects subject to Prevention of Significant Deterioration is part of EPA’s process toward reform.
The inability to permit a project hurts the competitiveness of the facility, harms product development and innovation and can thwart environmentally-beneficial projects. Local communities will miss out on new jobs and economic growth, while industry sectors face the risk of becoming uncompetitive in the global marketplace of forest products. Learn more.
BIOMASS FOR RENEWABLE ENERGY
The forest products industry is the nation’s leading producer and user of carbon-neutral renewable biomass energy. Woody biomass is an essential raw material for value-added forest products, such as paper, packaging, wood products, wood-based chemicals and other innovative products. Paper and wood products manufacturing facilities account for 62 percent of the renewable biomass energy consumed by all manufacturing sectors, most of which is derived from manufacturing byproducts and residuals. This process is among the most efficient in the world, using materials that could otherwise go unused to create both thermal and electrical energy, commonly referred to as combined heat and power (CHP), or cogeneration technology.
Studies show that per ton of wood used, the forest products industry sustains nine times as many total jobs as the biomass energy sector. Accordingly, it is important for federal renewable energy policies should not require forest products manufacturing facilities to compete on an uneven playing field with their power suppliers and other energy producers for biomass fiber. AF&PA believes market forces, not government mandates and incentives, should determine the use of wood and wood residuals for renewable energy. Learn more.
CARBON NEUTRALITY OF BIOMASS ENERGY
Paper and wood products mills use forest biomass byproducts and residuals from their manufacturing operations to generate bioenergy. The energy is used to make products and it provides significant greenhouse gas reduction benefits to the environment. Congress adopted legislation in May 2017 and again in March 2018 and February 2019 directing agencies to establish clear and simple policies that reflect the carbon neutrality of forest-derived bioenergy. AF&PA urges the administration to implement the legislative directive in regulations by the end of 2019.
The forest products industry is the largest producer and user of bioenergy of any U.S. industrial sector. The creation and use of bioenergy in forest products mills is integral to the manufacturing of products such as pulp, paper, packaging, tissue and wood products. Pulp, paper and wood products mills convert biomass byproducts and residuals to energy while manufacturing biobased products that are useful to society. This sustainable use of forest products manufacturing residuals for energy provides enormous greenhouse gas benefits by avoiding the emission of about 181 million metric tons of CO2. This is equivalent to the emissions of about 35 million cars. Learn more.
The industry is a leader in the generation and use of renewable energy and highly-efficient CHP technology. Energy cost reduction through efficient use is a fundamental management objective for the industry.
Pulp, paper, packaging and wood products facilities account for 62 percent of the renewable biomass energy consumed and provide 30 percent of the CHP electricity generated by all manufacturing facilities. In fact, 98.5 percent of electricity produced by the industry is CHP-generated. Provisions of the Public Utility Regulatory Policies Act of 1978 (PURPA) are still needed to ensure equitable treatment of industry CHP units.
While the paper and wood products manufacturers lead in the sustainable forest biofuel, they are also concerned about the new demands being imposed on the resource from market-distorting government mandates and incentives. When government policies increase demand for forest-based renewable energy, they should be coupled with policies to increase biomass supply. Learn more.
EPA AIR REGULATIONS
The paper and wood products manufacturing sector has met many costly regulatory challenges over the years, spending billions of dollars as part of its environmental stewardship. Many of those investments have led to major improvements in air quality, including a 36 percent reduction in emissions of nitrogen oxide and 73 percent for sulfur dioxide by our pulp and paper facilities since 2000. Unfortunately, the constant rewriting of existing regulations and imposition of new regulations – often driven by lawsuits under the Clean Air Act –could impose billions of dollars in new capital obligations on the industry over the next 10 years. The cumulative burden being imposed on our businesses is unsustainable. AF&PA recommends that EPA retain the current PM NAAQS change policies to reduce the number of mill projects that trigger NSR; adopt Prevention of Significant Deterioration policies that allow use of more realistic emissions data and modeling tools to replace decades-old approaches; quickly revise Boiler MACT emission limits; and adopt regulations consistent with the FY 2019 Omnibus Appropriations bill section on “Policies relating to Biomass Energy” to give the paper and wood products industry certainty that biogenic emissions are carbon neutral in federal regulations and air permitting programs. Learn more.
Between 2005 and 2016, AF&PA members reduced their greenhouse gas (GHG) emissions by 19.9 percent, nearly reaching our Better Practices, Better Planet 2020 goal of 20 percent reduction.
U.S. carbon dioxide emissions declined 2.0 percent in 2016 and 13.4 percent between 2007 and 2016, largely due to market driven and voluntary reductions such as improved energy efficiency and shifts from coal to natural gas by the electric utility sector.
Policymakers should reassess the need for GHG regulations in light of ongoing, market-driven GHG reductions and any regulations should ensure least-cost compliance and electricity reliability. The Clean Power Plan (CPP) federal regulation of GHG emissions from existing electric utilities under the Clean Air Act (CAA) was stayed by the Supreme Court in February 2016. The stay removes the states’ obligation to submit compliance plans to EPA until after litigation is resolved. AF&PA supports the EPA’s proposal to repeal the CPP pursuant to the president’s Executive Order and the D.C. Circuit’s Orders to hold in abeyance the litigation challenging the rule. We also support EPA’s proposed Affordable Clean Energy (ACE) rule, in that it is less costly than the CPP and its “inside the fenceline” approach is consistent with EPA’s authority under the Clean Air Act. Learn more.
HUMAN HEALTH WATER QUALITY CRITERIA
Under the Clean Water Act (CWA), states have the primary responsibility to develop water quality standards. States begin that process with EPA’s Human Health Water Quality Criteria (HHWQC), but can use other criteria, as long as they are adequately protective of human health. In several states, EPA has improperly removed that flexibility and imposed radical risk policies in the calculation of certain water quality standards that are in many cases unattainable and could cost municipal and industrial dischargers billions of dollars.
If applied to other programs, these policies will determine “how clean is clean” for Superfund cleanups and make other standards more stringent and expensive, without a commensurate improvement in human health. EPA should reverse these policies and allow states to adopt achievable HHWQC that more than adequate to protect human health. Learn more.
AF&PA is a strong proponent of international efforts to suppress trade in illegally-sourced fiber because it is a serious detriment to the industry’s sustainability, the environment and the global economy. An AF&PA-commissioned study prepared in advance of the 2008 Lacey Act amendments estimated that illegal logging costs the U.S. forest products industry some $1 billion annually in lost export opportunities and depressed U.S. wood prices.
The 2008 Lacey Act amendments make it illegal to trade plants and plant products — including wood, pulp and paper — harvested or traded in violation of the laws of a foreign country. The Lacey Act also requires importers to file a declaration naming the country of harvest and the genus and species of plants contained in the products, although the declaration requirement has yet to be phased in for composite wood products or for pulp and paper.
AF&PA works with a broad consensus coalition of businesses, conservation groups and labor organizations that are calling on federal agencies to ensure full implementation of the law. AF&PA supports adequate funding for the implementation of the Lacey Act and the appropriate phase-in of the declaration requirement to imports of composite wood products and pulp and paper. Learn more.
Paper and wood products exports account for about 15 percent of the industry’s annual total sales. In 2018, the industry’s global exports were an estimated $33 billion, of which $22.8 billion were exports of pulp, paper and packaging and $10.2 billion were exports of wood products. We estimate that our industry’s exports support approximately 111,000 jobs at pulp, paper and wood products mills and related logging operations in the U.S., as well as many more jobs in communities where these facilities are located. More than 75 percent of U.S. pulp and paper mills are located in counties designated by the Census Bureau as more than 80 percent rural.
AF&PA supports trade policies that advance our industry’s strong global market position. In an increasingly globalized market, it is critical for the U.S. paper and wood products manufacturing industry to achieve unrestricted access to international markets and level the playing field among international competitors by eliminating both tariff and non-tariff barriers.
U.S. producers of goods and services risk falling behind without an aggressive effort of foreign market opening. AF&PA supports the negotiation of trade agreements that result in commercial benefits for American companies by reducing tariffs and traditional non-tariff barriers; agreements designed to generate substantive economic benefits for U.S. paper and wood products companies and their workers; and new rules and stronger disciplines in areas such as customs administration, intellectual property protection and the role of state owned enterprises.
AF&PA supports the recently negotiated U.S.-Mexico-Canada Agreement and has submitted negotiating priorities for the U.S.-European agreement. As Congress considers implementing legislation, AF&PA is committed to working with like-minded industry groups and Congressional offices to improve provisions that provide greater protection to U.S. investors in Canada and Mexico.
The U.S. paper recovery rate reached 68.1 percent in 2018 and the annual paper recovery rate in the U.S. has doubled since 1990. By weight, more paper is recovered from municipal solid waste streams than glass, plastic and aluminum combined, according to EPA. Recovering paper extends the useful life of fiber and saves valuable landfill space. Paper recycling is widely accessible, with 96 percent of Americans having access to community curbside and/or drop-off paper recycling programs. The existing voluntary, market-based paper recovery system fuels innovation, creates lasting infrastructure and enables us to make new products from paper that is diverted from the waste stream. Learn more.
The U.S. Postal Service (USPS) supports a $1.4 trillion mailing industry that employs 7.5 million Americans. Approximately 39 percent (nearly $6.5 billion worth) of communications papers produced in the U.S. are delivered through the mail system.
Despite being a significant driver of the nation’s economic engine, the USPS faces financial insolvency. As a part of its required 10-year review, the Postal Regulatory Commission concluded the current rate system does not meet the objectives established by Congress, and has proposed modifications that, if implemented, would increase customer costs. AF&PA opposes the proposal. For mail to remain a vital part of the American economy, high-quality service and reliability at an affordable cost are necessary. Raising rates and reducing services are counterproductive in an economy where industry and consumers are seeking faster and cheaper delivery options for communications and business transactions Learn more.
PROMOTING ACCESS TO PAPER OPTIONS FOR GOVERNMENT PROGRAMS
AF&PA believes the public should be able to choose the manner in which they receive information and services from the government and not be forced into a digital-only delivery option. Paper and digital formats work together to deliver information to consumers and citizens. In the private sector, many companies use both forms of information delivery to reach the greatest number of people in the most effective way.
Federal agencies are eliminating services and communications such as social security documents, tax documents and forms, prescription drug labels, investment documents, and savings bonds in paper formats. The government’s rush to digitize is shortsighted, leaving many people without a viable option. Such policies discriminate against millions of Americans, many of whom are in rural communities and/or low income households — 45 percent of seniors do not own a computer and 30 percent of citizens do not have online access at home. Learn more.
PAPER PROCUREMENT POLICIES
AF&PA opposes government procurement policies mandating recycled content as an ineffective path to increasing paper recovery. Additionally, the distinction between pre- and post-consumer content constrains the amount of recovered fiber available for recycling and should not be used in government policies.
Mandating post-consumer recycled content for fiber-based products creates the misleading perception that certain types of recovered fiber are better than others. Not all types of recovered fiber are suitable for recycling into communications papers and available post-consumer sources of recovered fiber are declining.
Rather than arbitrarily mandating minimum post-consumer content in products, government aim should be to increase paper recovery. EPA should not be identifying or requiring sustainable product standards based on limited information, or making choices based on a process that lacks transparency.
AF&PA’s comprehensive sustainability initiative — Better Practices, Better Planet 2020 — includes six measurable goals focusing on paper recovery for recycling, energy efficiency, greenhouse gas emissions, sustainable forestry practices, workplace safety and water use. Our members have long been good stewards of our planet’s resources, and this initiative shows our proactive approach to the long-term success of our industry, our communities and our environment. We have made great strides towards reaching the Better Practices, Better Planet 2020 goals, surpassing those for greenhouse gas emissions and workplace safety ahead of schedule. Learn more.
The recently-enacted Tax Cuts and Jobs Act encourages economic growth, job creation and the competitiveness of all U.S. businesses. Central to the new tax system is a low corporate tax rate, support for investment in U.S. manufacturing and its global supply chain and an international tax system that reflects a globally-competitive territorial tax system.
Our industry is highly capital-intensive and is making significant investments and facility upgrades to reflect technological advancement and compete in a competitive global marketplace. The recently enacted tax law is essential to investment in the coming years.
As the Internal Revenue Service and Department of Treasury implement the 2017 tax reform, AF&PA is focused on appropriate rules related to expensing of capital equipment, interest expense, research and development and international tax policies. Learn more.
AF&PA advocates for investments and policies that will ease congestion on roads and create safer, stronger highways. We support updating the antiquated weight limits on the interstate so that truck traffic can be reduced in a safe and efficient manner. An increase in the maximum allowable weight of six-axle semi-trailers is an effective and safe way to increase truck productivity and America's freight capacity. Technology improvements and stronger roads and bridges make it safe for each truck to carry more freight. It would also mitigate the current transportation capacity shortage that inhibits moving raw materials to mills and products to customers.
Rail customers are not receiving reliable rail service at reasonable rates. Nearly one-third of forest products facilities have access to only one rail carrier. AF&PA supports efforts to allow forest products access to Surface Transportation Board remedies for poor service and excessive rates. Learn more.