Miles Roberts, leading the FTSE 100 packaging giant DS Smith, has expressed concerns over the UK’s potential lag in the manufacturing arena if the government continues to be ambiguous about its green energy initiatives. In search of clearer policies, DS Smith has invested €90m (£78m) in a French paper mill while keeping UK-based investment decisions on hold.
Global Green Efforts in Comparison
The European Union’s Green Deal and the US Inflation Reduction Act have significantly influenced industries by offering substantial subsidies. These initiatives are aimed at both reducing carbon emissions and fostering the production of transition technology away from fossil fuels. In contrast, Roberts is urging the UK government for similar support, posing the question, “We’ve taken back control, so where is that control? How are we making Britain an attractive place to invest?”
The Stakes for DS Smith
Originating from east London in the 1940s, DS Smith has been at the forefront of cardboard production and recycling. With the surge in e-commerce deliveries, companies like Amazon have heavily relied on their services. However, Roberts emphasizes that without a definite UK strategy towards carbon neutrality, industries might resort to more attractive global investments, leading to potential manufacturing decline in the UK.
He added, “The US and EU are providing significant incentives. We, along with many other companies, are beginning to capitalize on these opportunities.”
Shifting to Biomass Burners
DS Smith’s move in France represents their shift to cleaner energy. The Rouen paper mill is in the process of transitioning from coal-fired boilers to biomass burners, meeting 80% of its substantial energy demands. This shift is significant as paper production is one of the most energy-draining sectors. In the UK, energy expenses are nearly twice as much as in the EU.
The biomass furnaces at the Rouen mill will be fueled by waste wood from various sources, ensuring no direct usage of forest-derived wood or pellets. Adding to France’s appeal, Roberts mentioned the consistent and long-term support offered by the French authorities. This includes a commitment to provide waste wood, a stable pricing model, and long-term biomass licensing.
The DS Smith CEO’s emphasis on the fragmented UK approach, particularly regarding waste collection, underscores the pressing need for the UK government to provide industries with a clear, long-term vision on green energy and sustainability.