International Paper is receiving a huge tax credit by burning its alternative fuel mixture at 15 of its mills.

International Paper is burning a mixture of black liquor and diesel fuel.

Black liquor is a byproduct of the pulping process. It contains wood lignins and pulping chemicals. Mills are burning the black liquor and are using the steam to generate power for the mills. The pulping chemicals (sodium hydroxide and sodium sulfide) are recovered from the process as white liquor that is used by the pulp mills in the digesters to cook the wood chips.

International Paper is mixing diesel fuel in with the black liquor at a rate of .5gpm. While this does not add much BTU value to the black liquor, it does classify it as another green fuel because it generating power and not emitting anything to the environment. By classifying it as another green fuel, International Paper gets a tax credit for every .5gpm burned for every one gallon of black liquor burned.

International Paper said that they were approved in January 2009 as an alternative fuel mixer. On March 20, 2009, the company received its first check from the Internal Revenue Service in the amount of $71.6 million for the period of November 14 to December 14, 2008.

International Paper will continue to submit refund claims based on actual mill production and use of an alternative fuel mixture and will provide investors with information relating to future credits during its regular quarterly earnings calls.

This tax credit is calculated at a rate of $0.50/gallon of black liquor and will certainly encourage U.S. pulp mills to operate at full capacity.

Current research aims to use black liquor and biomass gasification to completely eliminate the need for fossil fuel energy in paper manufacturing.

Read more:
The New Informer (Covington USW Local 8-675 Union Newsletter)
Fueling self sufficiency: pathways to change: black liquor and biomass gasification/ combined… (Solutions – for People, Processes and Paper)
Kraft process (Wikipedia)