Here’s the saga in a nutshell:
So-called black liquor is the sludge—“spent cooking liquor” is the more or less official term for it—that is generated during the “kraft” paper pulping process. Kraft pulp—generated through a chemical process—is used to make high-brightness papers like copy paper, high-end coated paper, and other freesheets, as well as certain packaging materials. Other pulping processes, such as mechanical, that are used to make newsprint or “fluff” pulp that goes into tissue, don’t generate black liquor.
But more than simply useless muck, black liquor is actually a valuable fuel source, and is reused by paper companies to help generate power for the mill. This is nothing new; paper mills have been burning black liquor since the 1930s.