Industry News


Stora Enso finalises the restructuring of Bergvik Skog’s forest holdings


T


he shareholders of Bergvik Skog AB, a Swedish forest holding company, have finalised the previously


announced restructuring of its ownership. Stora Enso’s forest holdings in Sweden will increase to 1.4 million hectares, of which 1.15 million hectares is productive forest land. Prior to the transaction, Stora Enso’s indirect share of Bergvik Skog’s productive forest land was 936 thousand hectares. “I am very pleased that we have


successfully finalised the restructuring of Bergvik Skog with the other shareholders. This transaction is a natural next step for us, as we strongly believe in the bioeconomy and want to secure our competitive raw material supply for the long term. The direct ownership gives us better opportunities to further develop


sustainable forest management, thus strengthening our competitiveness,” says Stora Enso’s CEO Karl-Henrik Sundström. As part of the transaction, Stora


Enso acquires Bergvik Skog Plantor AB nursery and three wind turbine projects. This will further strengthen the Group’s comprehensive offering to forest owners in Sweden and is in line


with its commitment to sustainable forestry. The financial impact of the


restructuring for Stora Enso will be as follows: ● Bergvik Skog was previously reported as an equity accounted investment. Upon completion of the restructuring, Stora Enso’s Swedish forest assets are placed in a fully


RHI grace period extended following industry campaign From May, 2019 customers with


BEIS has today announced an extension to the Renewable Heat Incentive (RHI) deadline. The deadline has been extended from 31 January, 2020 to 31 January, 2021. The REA, as part of a co-ordinated industry effort, has campaigned for the extension since 2018 REA welcomes the extension as a


signal from Government that they are committed to the sector Under previous RHI regulations,


all plants with a tariff guarantee would have needed to commence injection of biomethane by 31st January 2020 or 183 days after the date on which the applicant expected the injection to commence.


In a joint industry letter sent


to BEIS and resulting discussions, the REA highlighted that this deadline was extremely tight. When taking into account build times of biomethane projects and the time needed by the gas networks to verify that the commissioning


followed appropriate procedures. The REA warned the Government that a number of biomethane plant developers and funders could abandon their investments and projects unless a swift decision to extend the deadline was made. The REA and our members


welcome the Government’s decision to extend the RHI as a signal of their commitment to the sector. James Court, Policy & External


Affairs Director at the Renewable Energy Association commented: “The RHI extension is fantastic


news for the industry and incredibly rewarding for the REA who has dedicated a lot time and effort to this campaign over the last few months. “The extension will encourage


new development and sends a positive message to the sector that Government is committed to fostering green gas and advancing the decarbonisation of the gas grid.”


owned subsidiary and consolidated line by line in Stora Enso’s results in segment Other from 1 June 2019 onwards. ●The transaction results in an increase of approximately EUR 1.0 billion in Stora Enso’s interest-bearing net debt and the net debt to EBITDA ratio will increase by approximately 0.5x once all the transaction steps have been finalised by the end of 2019. ● The net debt to EBITDA ratio was 1.7x at the end of the first quarter of 2019. The ratio will exceed the strategic target level of 2.0x temporarily during the second half of 2019 before all the steps of the transaction have been finalised. ● Capital employed increased by approximately EUR 1.0 billion, resulting in a decrease in the operational return on capital employed (ROCE) of approximately 1 percentage point.


Green bus journeys


the Savonlinja bus company have been able to opt for a lower-emission journey. In cooperation with Neste, Savonlinja is introducing a surcharge, called Green Travel, on the normal bus ticket price. The customer is free to decide the amount of this additional charge. Savonlinja will use the money


collected through the Green Travel service to reduce its greenhouse gas emissions by fueling its buses with Neste MY Renewable Diesel™, which is produced entirely from waste and residues. By paying a Green Travel surcharge of their own choosing, customers will be reducing their bus ride’s greenhouse gas emissions by an average of 90% compared to fossil diesel. This arrangement is the first of its kind in Finland. “The key to fighting climate


change is introducing innovations of all sizes to help bring about a more sustainable future. Developed in collaboration with Savonlinja, Green Travel is a good example of how important partnerships are to creating


effective solutions. We are very proud to collaborate with Savonlinja on offering consumers the opportunity to reduce the carbon footprint of their bus trips,” says Tuomas Kulola, head of sales, marketing & services at Neste. Green Travel service will be


available to all Savonlinja’s long- distance passengers. Green Travel can be purchased for regular long-distance tickets via the mobile application “Linjalla” and at the Savonlinja online store. Customers decide on the price of the Green Travel themselves. The minimum fee is €1. “Customers have told us that they


would like to have more climate and environmentally friendly transport options. Green Travel is the answer to this,” says Savonlinja’s chief business officer Harri Leskinen. As part of the cooperation,


Savonlinja will double the amount of money its customers pay for Green Travel service and use these funds for cutting down greenhouse gas emissions by refueling with Neste MY Renewable Diesel.


Summer 2019 Forest Bioenergy Review 3


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