The boiler replaces the current oil-fed boiler and will meet Grycksbo's entire need for steam when it comes online in the second half of 2009.

The total SEK130m (£10.9m) investment includes the boiler as well as a new handling and biofuel storage area, a filter for smoke gas cleaning and renovation of the existing turbine to produce environmentally responsible electricity.

The company, which makes G-Print paper and has a slogan of 'no one greener', might make further investments depending on which biofuel is chosen for the boiler, with alternatives including pellets or woodchips made from branches and treetops.

Mikael Frölander, managing director of Grycksbo, said the aim was to produce G-Print paper in the most environmentally sound way possible.

"We have been taking steps to become more environmentally responsible for many years now; for example in 2003 we started to use railway transport for G-Print on all destinations possible," he said. "We also hold Chain of Custody certification in accordance with FSC regulations. Additionally, our emission levels to both air and water are very low, which we also present in our annual EMAS reports."

Grycksbo plans to abandon oil as an energy source when the biomass boiler starts operation, and the mill's energy needs will be generated from renewable and locally available biofuels.

The company claims the investment will reduce the mill's fossil CO2-emissions by 80,000 tonnes - equivalent to the annual emissions of all 27,382 cars in the local municipality of Falun, driving an average 14,000km.

The company also claims that the excellent runnability of G-Print paper means less waste and less downtime, saving environmental resources.

Grycksbo Paper is sold by The Paper Company in the UK.