Demand for RPF (recycled plastic fuel), which is used as petroleum fuel, is currently tight, especially among paper manufacturers. In the "if you can make it, you can sell it" market, the challenge for RPF manufacturers is to secure raw materials such as paper and plastics, and many manufacturers are engaged in businesses that do not meet their production capacity.

Demand for RPF (recycled plastic fuel), which is used as petroleum fuel, is currently tight, especially among paper manufacturers. In the "if you can make it, you can sell it" market, the challenge for RPF manufacturers is to secure raw materials such as paper and plastics, and many manufacturers are engaged in businesses that do not meet their production capacity.
One RPF manufacturer that has earned the trust of major paper manufacturers through its selection and securing of RPF raw materials and solid business plan is Hokuetsu Kankyo (Niigata City). In the midst of a generational shift, the company is trying to establish a new business model on a life-size basis amid the need for new business development and a new business model for the regional intermediate treatment and final disposal industry.
Hokuetsu Paper's Niigata Mill, a paper manufacturer with the top three market share in printing and information paper, is located in an area five minutes by car east of Niigata Station.
Currently, Hokuetsu Paper is aggressively developing the use of wood chips and alternative fuels at its four mills nationwide, including Niigata, in order to keep emissions at the same level in a given year.
An intermediate industrial waste treatment plant is located on a long, narrow site between the mills and a freight train pull line. This is one of the sites that supply wood chips and RPF to Hokuetsu Paper Mfg. The company basically accepts construction waste, and allocates waste that is not made of a single material to RPF raw materials.
The company's RPF is formed by reducing the volume of the raw material, heating it to about 140°C, and extruding it to about 1 m in length. RPF with the same calorific value as coal is then obtained. Most of the company's monthly production of 1,500 tons is delivered to Hokuetsu Paper, but "some customers have recently ordered it as an auxiliary fuel for the incineration of medical waste. We are beginning to see the advantages unique to RPF, not only as an alternative fuel, but also in terms of longer combustion time," he says, adding that he is also making efforts to utilize customer information.
Because they handle a wide variety of construction waste, they are certain about their selection of RPF raw materials and the quantities they need. Even waste of composite materials with mixed fibers, such as curtains, sofas, helmets, and safety shoes, can be sorted for clarity. The key point is the concept of recycling and RPF-ing even the dust generated from wood shredding.
The company makes a profit from the waste processing fees it receives from Hokuetsu Paper and from the sales of the RPF raw materials it produces from the waste. The contract term is 15 years, which is still cheaper for Hokuetsu Paper than paying outsourcing fees to other processing companies.
Establishment of a second-generation business model.
The parent company of Hokuetsu Kankyo was a final disposal facility run by Nagai's father, Koei. Now, four years later, banks are offering unsecured loans and the company is attracting orders from a variety of sources, but in his first year or two in the position, "the business was on fire," Mr. Nagai recalls. We are delivering.
The bank has also begun development of CRPF, which has the same calorific value as coal and almost the same quality and features as RPF. If commercialized, RPFs will be able to treat and fuel the tens of thousands of tons of waste generated annually nationwide at a lower cost than melting furnaces and other methods.
The carbonized sludge is turned into powder and fed into the same RPF production line, resulting in a clay that is easy to mold. We have found that organic waste, such as food scraps, can also be carbonized to produce sufficient heat to make an optimal CRPF feedstock. If we can clear the cost of carbonization equipment, we have enough competitiveness," he said.
The RPF production was successfully achieved by setting the heating temperature 20 degrees higher than usual, relying on the intuition of the 23-year-old Spotschauer Danto. Regardless of age, employees are professionals in their respective fields. Both RPF and wood chips require only one maker. Our profit margin should be better with about 20 people than with a specialized manufacturer that employs hundreds of people and sells billions of yen".
Other businesses are linked through intermediate treatment to extend the life of mixed waste. For Mr. Nagai, there was no other choice but to survive. He said, "Intermediate treatment is just to reduce the volume of accepted materials. We were making a huge loss, and I was paying my employees with my own savings. Even so, I had to ask some employees to take a few months off. During that period, I felt bad for the employees and it was really hard," he says.
Mr. Nagai heard that the company used to convert its disposal materials into wood chips and RPF, which it began buying from other companies. Mr. Nagai decided to try to reuse the fuel for Hokuetsu Paper. The goal was set with the specific needs of the time. We were open for business, so we selflessly tried to see what could be used as a raw material for alternative fuels," he said.
Mr. Nagai and the company's employees are eager to learn. When Mr. Nagai himself applied to the government at his current business location, he prepared the documents himself without asking an administrative scrivener. The efforts he made were supported by the government, customers, and others around him. After all, Hokuetsu Paper has been his client since the time of his father, Koei. The wealth built by his predecessors has been passed on through Mr. Nagai's new business development.
When RPF production began to take off, he turned down an offer from another regional paper manufacturer. He said, "You have to see how much of the raw materials for RPF are available in your area. In order to make a business viable in the face of dwindling raw materials, you must first consider the amount you can produce," he said.
Mr. Nagai is constantly thinking about how his business can contribute to new environmental businesses and environmental improvement. From that perspective, as a player in the industry, we consider what position we can take to make a profit. We try to manage our business in a way that is appropriate for the size of our company, without overstretching ourselves," he says.