Public affairs

Sustainable use of forests is an asset for replacing fossil materials 

In UPM’s view, wood-based products that replace fossil materials are one significant solution to mitigate climate change. We advocate sustainable forest management as a way to enhance biodiversity and grow carbon sinks and are committed to climate positive forestry through UPM Forest Action. Reducing fossil consumption must remain key priority and forest carbon sinks should not compensate these emissions.

UPM strictly condemns deforestation. Our own forest management and additional wood sourcing do not cause deforestation anywhere in the world. Wood fibre, the key raw material for all UPM businesses, is renewable and comes from sustainably managed forests.

Regulation that promotes the use of renewable raw materials from sustainably managed sources is beneficial for all existing and future UPM businesses. While we advocate for increased use of renewables to defossilise our economy, UPM recognises the necessity to promote bioeconomy agenda within the boundaries of sustainably available feedstock.

Sustainable forest management and the ability to replace fossil consumption with domestic sustainable biomass should be built as one key cornerstone of EU’s strategic autonomy goals. Read more from our Position Paper on the Next European Commission 2024-2029.

Renewable circularity is the foundation for a sustainable packaging sector

UPM produces sustainable packaging materials. We strongly believe in renewable circularity as the foundation for a sustainable packaging sector in the future. This is why we promote equal position in legislation to recycling with reuse. Also, innovation potential of sustainable packaging should not be hindered by defining solutions in regulation, that are too technical.

Forest industry plays a significant role in the defossilisation of materials

The defossilisation of the material sectors, such as chemicals and plastic, requires alternative feedstocks. Biorefineries play a significant role in this transformation. Our biorefineries in Lappeenranta, Finland, and Leuna, Germany, offer innovative, sustainable and competitive wood-based biochemicals for replacing fossil-based raw materials and improving the environmental performance in various applications.

Advanced biofuels play an important role in UPM's Biofore strategy by offering innovative and sustainable alternatives to fossil-based oil products. For several years, UPM has been advocating for stringent rules to reduce transport emissions. Although recent revisions in the renewable fuel regulation have improved advanced biofuels’ situation on the markets, complexity of regulation has increased tremendously. Therefore, UPM calls for technology neutrality and simplification of the regulatory framework. 

Biorefineries are also an important part of the emerging hydrogen economy. We are exploring opportunities to utilise our know-how and assets to benefit from the growth of hydrogen-based products. We have access to emission-free electricity, our own biogenic CO₂ resources, and strong competences in existing hydrogen production.

Ensuring functioning energy markets is essential 

The war in Ukraine intensified the energy transformation and volatility in prices and demand has increased in the energy sector. Market-based price signal is essential now, and in the future, to ensure an efficient electricity market, system balance and investments into new capacity.

Cost competitiveness of the European energy-intensive industries must be ensured. Sufficient investments in variable renewable, emission-free baseload (including nuclear), and balancing electricity capacity are prerequisites for future clean European industry.

Innovations need to be scaled into large-scale production 

The objective of UPM’s R&D programmes and business development is to create new technologies and products for UPM’s developing businesses and to provide support for its current businesses and ensure that they remain competitive.

UPM advocates for competitive operating environment, where innovations can be scaled up into industrial production. The willingness to invest in new production increases when operating environment has a predictable outlook, competitiveness is ensured, and licensing systems are agile.

Energy taxation and subsidies of industry must ensure a level playing field 

Energy taxation is subject to detailed regulation at different country and EU levels. We advocate for a level playing field in each of our main operating areas. Most of UPM’s electricity production is nuclear power, hydropower, or combined heat and power (CHP) production at mill sites, where most of the fuels used are from renewable sources. The electricity used by UPM is subject to electricity taxation, regardless of which sources are used. 

In energy policy, market-based pricing is the best way to achieve a competitive electricity price level. Any measures to improve the security of electricity supply must be taken in such a way that they do not destroy the price signal of the market. 

Energy taxation of industry and the use of energy subsidies must ensure a level playing field. When implementing international tax legislation, care must be taken to ensure that no additional measures are introduced in UPM’s operating areas that are not applied by competing countries.

UPM promotes free trade 

UPM’s products are exported to customers around the world. We promote free and rules-based trade. While free trade promotes prosperity, we recognise the need for rules to ensure fair trading conditions. This applies also to trading practices in green transition and environmental requirements. In recent times, we have seen significant increase in fraudulent trading practices also affecting sectors where UPM operates. As an example, the EU authorities have taken action against illegal Russian wood product imports arriving from third countries. 

Successful, transparent and acceptable green transition must ensure that the same standards are being met in the EU and outside the EU.