Packaging maker SCA will double the amount of recycled fiber it uses at its kraftliner plant in Obbola, northern Sweden, with a € 300million (£ 254million) loan from the European Investment Bank (EIB).
The funding will support the upgrade of the plant for increased production of recyclable and renewable packaging with a process known as papermaking 4.0.
The machines will be digitally integrated and will be more efficient.
Recycled fibers and sustainable wood sources will be used in the production of kraftliner.
EIB Vice-President Thomas Östros said: “In addition to making this production facility more energy efficient, the project also has a good circular economy angle – it will double the use of recycled fibers for its manufacturing process.
“Especially in today’s economy, the packaging of products and deliveries is playing an increasingly important role, which means that the possibility of using recycled fibers has a huge impact on the use of natural resources.
SCA President and CEO Ulf Larsson added: “The demand for sustainable packaging is increasing and SCA decided in 2019 to increase the manufacturing capacity of the Obola plant from 450,000 tonnes to 725 000 tons.
“With this investment, the need for fossil fuels in critical parts of the production process will be eliminated, significantly reducing the carbon footprint. With this investment in the world’s most advanced kraft coating plant, we will significantly improve the plant’s competitiveness, sustainability footprint and product quality.