EU Okays Aid for UK Newsprint Producer

The European Commission approved about $27.55 million in financial assistance to Shotton, a newsprint producer in North Wales that is owned by UPM-Kymmene.

The aid will be granted under the Waste and Resources Action Programme, which was established to promote sustainable waste management. The financial assistance is designed to assist in Shotton's facilities to convert to using recovered fiber instead of virgin pulp.

According to UPM, the total cost to convert the mill to using recovered fiber will total around $200 million. When fully operational the new machinery is expected to handle about 321,000 metric tons of recovered fiber a year.

Despite the fact that the EC is actively promoting the increased use of recovered fiber, the Commission’s  assessment is that the project does not qualify as an environmental project within the meaning of the environmental aid guidelines. Rather, it is an investment in state-of-the-art newsprint production capacity. Also the use of 100 percent recycled fiber is common practice in the paper industry.

Additionally, the environmental aid guidelines provide only provide for aid to be granted to investments that improve a company's individual environmental record.