Special Report No. 76-05: A Survey of Pulp and Paper Industry Environmental Protection Expenditures and Operating Costs – 1975

The attached special report summarizes the findings of the National Council's survey of industry environmental expenditures during 1975, which was conducted during the first half of 1976. Based on questionnaire information solicited at the corporate level it also contains projections of capital expenditures envisioned for 1976 through 1978. All such capital expenditures are categorized for report purposes among air and water quality protection and solid waste management at the point of primary pulp and paper manufacture. The report itself addresses a number of questions related to the magnitude of such expenditures. With regard to industry environmental protection capital expenditures, it differentiates the total 1975 expenditures of $645 million among the three environmental protection areas mentioned earlier. It then subdivides those for water quality protection along internal process loss control and external effluent management lines. For the fourth consecutive year the environmental protection expenditures represent more than 30% of the total capital expenditures in the primary industry section involving pulp and paper manufacturing. For the third time the survey addresses the question of the extent to which special amortization, tax relief and financing methods have been employed to assist in financing this extensive capital expenditures program for environmental protection. Tax exempt bonds were estimated to have been employed in financing as much as $190 million. This is approximately 29 percent of the total and the same percentage as in 1974. Operating, fixed, administrative and research costs for 1975 are presented and total $706 million. These are further subdivided where possible among the three principal operational areas in line with past practice. The determination of administrative costs, which totaled $40 million, was reported again this year. Expressed on a 1975 production basis, total costs exceeded $10 per ton of paper and paperboard production, or approximately 25 percent higher than 1974. This is the fourth year that the expenditures survey was conducted on a corporate basis. A simplified procedure and a data analysis methodology will again be employed in early 1977 to expedite the development of similar survey data for 1976. The National Council again wishes to express its gratitude to the many participants in the corporate responses to this survey for their assistance in developing an industry-wide assessment of environmental protection expenditure trends. We look forward to your continued assistance in 1977 in expediting the next report on 1976 expenditures.