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1 ENVIRONMENTAL performance in UPM Madison

2 Through the renewing of the bio and forest industries, UPM is building a sustainable future across six business areas: UPM Biorefining, UPM Energy, UPM Raflatac, UPM Paper Asia, UPM Paper Europe and North America and UPM Plywood. Our products are made of renewable raw materials and are recyclable. We serve our customers worldwide. The group employs around 2, people and its annual sales are approximately EUR 1 billion. UPM shares are listed on NASDAQ OMX Helsinki. UPM The Biofore Company UPM Madison UPM Madison (Madison) is a member of UPM The Biofore Company. This environmental statement is prepared for all operations associated with the Madison facility for the calendar year 214. YEAR OF PROGRESS UPM Corporate ENVIRONMENTAL statement 214 UPM Madison is an integrated pressurized groundwood pulp mill and supercalendered paper manufacturing facility. Located in Madison, Maine at the heart of the Kennebec River in southern Somerset County, the site has a long and storied history, evolving from a sulfite pulp mill into the modern day design through a series of seven ownerships. Operations at the site include round wood handling and storage, drum debarking, pressurized ground wood pulping, facility offices, three power boilers, two hydroelectric generating stations and the paper machine. Wastewater generated in the processes is treated at the Anson-Madison Sanitary District s wastewater treatment facility, consisting of a primary clarifier followed by an aerated lagoon. UPM pulp and paper mills UPM Madison Environmental Performance 214 is a supplement to the Corporate Environmental Statement of UPM s pulp and paper mills (available at and provides mill-specific environmental performance data and trends for the year 214. The next Corporate Environmental Statement and also this supplement will be published in % of the wood fiber utilized in the manufacturing process meets the FSC Controlled Wood standard. Roundwood used in the groundwood pulping operation is sourced in compliance with SFI Fiber Sourcing and FSC Controlled Wood Standards. Purchased bleached northern softwood kraft is certified to the PEFC standard. Paper optical properties are enhanced by the addition of Precipitated Calcium Carbonate, which is manufactured onsite by a third party utilizing the carbon dioxide from the power boiler emissions. Production capacity Approximately 2, metric tonnes Personnel 22 Products Certificates Supercalendered (SC) paper for magazines and catalogs UPM Max (SCA Offset, Rotogravure) UPM Eco (SCB Offset, Rotogravure) ISO 141:24 Environmental Management System Standard FSC Chain of Custody - Forest Stewardship Council PEFC Chain of Custody - Program for the Endorsement of Forest Certification SFI Chain of Custody and Fiber Sourcing The certificates can be found in UPM s Certificate Finder (available at PEFC/ For PEFC products, visit For FSC products, visit 2 UPM MADISON, ENVIRONMENTAL PERFORMANCE IN 214

3 Environmental Performance in 214 A major improvement to our operations was connecting the mill to a natural gas pipeline in April, 214. We now have an uninterrupted supply of natural gas to the three power boilers that generate the steam required for paper drying, process heating and electricity generation. Madison had begun this conversion to natural gas from No. 6 fuel oil in December 211 with the development of a Liquefied Natural Gas supply system. This process was modified to a Compressed Natural Gas system in 213, the supply of which was terminated in December air emissions are increased as compared to 213 due to the combustion of No. 6 fuel oil in the first quarter 214. Last year we selected water use reduction as an ISO 141: target. Considerable effort to conserve fresh water in our operations has been ongoing since 211. On an m3/tonne produced metric, water usage has been reduced from 17. m3/tonne in 211 to the 214 level of 14.8 m3/tonne. Efforts have included reuse of whitewater throughout the operation and reduced fresh water usage in processes. wastewater, also experienced zero waste discharge license violations, reaching this mark for the ninth consecutive year. Madison participated in the UPM Planta-Tree day initiative in June 214, partnering with the City of Portland, Maine, and local elementary school children to replant areas of a park in Portland that had been harvested during the winter. Numerous trees had been damaged by the severe winter weather, requiring thinning and harvesting. Madison supplied the seedlings to the City of Portland, and in conjunction with the local elementary school, provided planters and guidance in repopulating the forests of the park. Employee safety continues to be a key performance indicator for Madison. Numerous training programs and employee education opportunities were offered throughout the year. To integrate safety practices into the home as well as at work, we invited employee families to the mill during our Safety Days events. Several families participated in fun and educational interactive safety- based activities. Successful external audits of the Madison ISO 141:24 system, the SFI fiber certification system and the FSC fiber certification system were conducted in 214, with all programs maintaining certification status. Solids losses were the second ISO 141:24 goal for 214. In 213, a whitewater screen system was installed, allowing for the reclamation of fiber and filler from the water prior to discharge to the sewer. This resulted in a reduction of solids losses in 212 to 213 from 2.5 kg/tonne produced to 12.6 kg/tonne. Last year we realized the full potential of this recovery process, achieving an 8.7 kg/tonne level. Energy conservation is also a key performance indicator for Madison. A three percent reduction in electricity usage combined with a 2.2 percent decrease in thermal energy was achieved in 214 as several energy conservation projects were completed. No violations of the Madison State and Federal Air Emissions License and Waste Discharge License were recorded during the year. The Anson-Madison Sanitary District, which treats Madison s process E. Russell Drechsel Daniel J. Mallett E. Russell Drechsel, General Manager Daniel J. Mallett, Manager of Sustainability UPM MADISON, ENVIRONMENTAL PERFORMANCE IN 214 3

4 Air UPM Plant A Tree Day. Madison, Maine Public Boat Landing. Air emissions are primarily associated with the operation of the three power boilers that provide heat and steam to the operations. Additional emissions are attributed to purchased electricity needs for the site. As referenced on Page 3, air emissions in 214 increased from 213 levels due to the use of No. 6 fuel oil in the boilers until the installation of the natural gas pipeline was completed April 1, 214. The No. 6 boiler was modified to allow for natural gas combustion in December 214, which now has the capability to combust natural gas in all thre power boilers. It is anticipated that the sulfur dioxide emissions will be reduced by 9% in 215 as compared to 214 levels. Energy efficiency projects aimed at reducing steam and electricity demand were implemented throughout the year. Total energy use decreased by 5.2%. No violations of the State of Maine Air Emissions License were measured during 214, marking the seventh consecutive year in which no violations were recorded. 15 FOSSIL CARBON DIOXIDE, CO 2 1, t/a 1,5 SULPHUR DIOXIDE, SO 2 t/a 25 BIOLOGICAL OXYGEN DEMAND, BOD 5 kg/a 12 1, NITROGEN OXIDES, NO X t/a DUST t/a PROCESS WASTEWATER mill. m University of Maine Intern performing wastewater testing Limit value 4 UPM MADISON, ENVIRONMENTAL PERFORMANCE IN 214

5 Water Waste UPM Madison utilizes the Anson-Madison Sanitary District to treat all process wastewater generated from manufacturing processes. This quasi-municipality operates the treatment plant designed to process municipal wastewaters generated in the community and Madison s effluent. Treatment consists of primary sedimentation followed by an aeration lagoon that promotes biological treatment. Since 26, no deviations of the terms and conditions of the Federal NPDES waste discharge permit have occurred. Flow and solids losses to the treatment plant were two of the Madison 214 environmental targets. Total Suspended BIOLOGICAL CHEMICAL OXYGEN DEMAND, BOD COD 5 kg/a mg/l PROCESS PHOSPHORUS, WASTEWATER P mill. mg/l m 3 Solids losses to the treatment plant were measured at 8.7 kg/tonne, down from the 12.6 kg/tonne 213 level. This reduction was due to the installation of a solids reclamation screen in 213, in which the reclaimed fiber and filler were reintroduced into the paper manufacturing process. Wastewater flow to the treatment facility decreased from 16.3 m3/tonne to 14.8 m3/tonne in 214 as compared to 213. Several water re-use projects contributed to this flow reduction. No exceedances of the Madison federal waste discharge permit were measured in TOTAL SUSPENDED SOLIDS, TSS kg/a ADSORBABLE ORGANIC HALOGEN COMPOUNDS, AOX mg/l Landfill In 214, 9.4 kg/metric tonne of waste products were landfilled, which accounted for 5.9% of the total waste generation. Wood waste from the round wood debarking operation at the pressurized ground wood mill and wastewater treatment plant sludge from the Anson- Madison Sanitary District are the two major waste streams generated at Madison. All wood waste is utilized either as a biofuel for local power boilers or as a bark mulch for landscaping contractors. The majority of the sludge is utilized by a local commercial compost facility for its final product. The remainder of the sludge is landfilled at an onsite facility or at a state-owned landfill. Municipal solid waste is landfilled at a commercial landfill. Waste metals, wood and mixed office waste are recycled at local facilities. Madison owns a sludge landfill, which is leased to the Anson-Madison Sanitary District for disposal of the wastewater treatment plant sludge on an as needed basis. Given the predominate end use of the sludge in the compost facility, and the fact that there is minimal air space remaining, the landfill is targeted to be closed in 215. Building waste and excess soil Ash Cleaning waste etc. Lime sludge/ green spirit dregs Fibre sludge/ Suction vehicle waste The weights t/a included in the figure are dry weights. 3, 2,4 1,8 1,2 6 SOLID WASTE TO LANDFILL UPM MADISON, ENVIRONMENTAL PERFORMANCE IN 214 5

6 Environmental parameters 214 The figures related to production as well as raw material and energy consumption are published as aggregated figures on group level in the UPM Corporate Environmental Statement. Production capacity Paper 245, t Raw materials and additives Pulp Roundwood Fillers Process Chemicals Other See UPM Corporate Environmental Statement for more information Energy Fossil Fuels Purchased Power 1% Fossil Fuels See UPM Corporate Environmental Statement for more information Air emissions Carbon Dioxide, CO 2 (fossil) Nitrogen Oxide, NOx Sulfur Dioxide, SO2 Particulate 76, t 12 t 188 t 14 t PGW Hydro Canal Water intake Process and cooling water 6,445, m 3 Water emissions Waste Mill area Effluent Volume BOD5 Solids Phosphorus Wastewater to Sludge to Landfill Wastewater to Sludge to Compost Woody Materials for reuse (Bark, Chips) Mixed Office Paper Recycled Metals Hazardous 2,826, m 3 11 t 17 t 2 t 913 bdt 726 bdt 4,6 bdt 128 bdt 94 t t 21.5 ha Paper Quality Testing 6 UPM MADISON, ENVIRONMENTAL PERFORMANCE IN 214

7 Performance against targets in 214 TARGET 214 RESULTS ACTION ITEMS UNDERTAKEN Achieve a target of 15. m 3 /metric tonne for wastewater flow to the Anson Madison Sanitary District. Achieve a target of 1. kg/metric tonne for total suspended solids discharged to the Anson Madison Sanitary District. Reduce the reportable Clean Run Category 3 events from the 1 qualifying events recorded in 213 to 6 qualifying events in 214. Actual flow of 14.8 m 3 /metric tonne for wastewater flow to the Anson Madison Sanitary District. Actual value of 8.7 kg/metric tonne to the Anson Madison Sanitary District. Category 3 events measured at 2 in 214. Reuse of non-contact cooling water into the process. Reduction in freshwater use throughout the manufacturing process Installed a solids reclamation unit in the paper machine whitewater system on 4/1/213. Increased employee awareness around contributing factors for Category 3 events. Reduced Oil Spills Current targets TARGETS AND MEASURES DEADLINE DEPARTMENT(S) RESPONSIBLE Achieve a target of 15. m 3 /metric tonne for wastewater flow to the Anson Madison Sanitary District. Achieve a target of 9. kg/metric tonne for total suspended solids discharged to the Anson Madison Sanitary District. Reduce the reportable Clean Run Category 3 events from the 2 qualifying events recorded in 214 to qualifying events in Mill Development Mill Development Mill Development Environmental verifier s declaration on verification and validation activities Environmental verifier Dr. Detlef Nehm (DE-V-223), acting for TÜV NORD CERT Umweltgutachter GmbH, licensed for the scope NACE Code (papermaking), declares to have verified whether the site Nordland Papier GmbH, in D-26892, Dörpen, Nordlandallee 1, as indicated in the Environmental Statement 211 of the mentioned site (registration no. FI-58), meets all requirements of Regulation (EC) No 1221/29 of the European Parliament and of the Council of 25 November 29 on the voluntary participation by organisations in a Community Eco-Management and Audit Scheme (EMAS). Papier GmbH, within the scope mentioned in the Environmental Statement 211. This document is not equivalent to EMAS registration. EMAS registration can only be granted by a Competent Body under Regulation (EC) No 1221/29. This document shall not be used as a stand-alone piece of public communication. Dörpen, 5 March 212 By signing this declaration, I declare that: the verification and validation has been carried out in full REG.NO. FI - 58 compliance with the requirements of Regulation (EC) No 1221/29, the outcome of the verification and validation confirms that there is no evidence of non-compliance with applicable legal requirements Dr. Detlef Nehm relating to the environment, the data and information of the Environmental verifier An operator marks a roll before wrapping. Several screens Environmental Statement 211 of Nordland Papier GmbH, reflect a DE-V-223 and cameras guide operators with the paper machine control system. reliable, credible and correct image of all the activities of Nordland TÜV NORD CERT Umweltgutachter GmbH UPM MADISON, ENVIRONMENTAL PERFORMANCE IN 214 7

8 UPM-Kymmene Corporation Madison PO Box Main Street Madison, Maine 495 USA Tel For further information, please contact: Russell Drechsel General Manager Tel russ.drechsel@upm.com 6/215

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