UPM Annual Report 2023

RESPONSIBILITY

UPM

BEYOND FOSSILS

BUSINESSES

GOVERNANCE

ACCOUNTS FOR 2023

ACTIONS FOR ENVIRONMENT

to improve the monitoring of the effluent treatment process. The UPM Augsburg paper mill in Germany successfully tested and installed a new filtration process to replace warm water used in paper machine showers. The technology will allow the mill to reduce water use even further from an already ‘best of the class’ level. In 2023, the UPM Caledonian paper mill in Scotland managed to reduce its freshwa ter consumption by 525 cubic metres per day through various process improvements such as filtering process water for reuse, optimising tank cleaning, and improving tank level control. Replacing a disc in a filter also yielded water and fibre savings. The installed turbo blowers on the paper machine vacuum system will allow the decommissioning of a cooling tower, saving both energy and water. We have a target to use 100% of the nu trients from recycled sources in our efflu ent treatment by 2030. In 2023, 33% (33%) was achieved, for example by replacing urea with the side stream product ammonia or with reject waters from composting and biogas plants. Collaboration with stakeholders In 2021, we joined the project ‘Circular economy of water in industrial processes’ together with several industrial and aca demic partners. The project ended in 2023, and, as a result of it, a laboratory measure ment method for microplastics in forest industry waters was developed, together with universities, in our research centre in Lappeenranta. In Uruguay, we continue to support the Rio Negro Initiative to improve the state of the river.

Process wastewater volumes

m 3 /t

RESPONSIBLE WATER MANAGEMENT

50

40

30

20

Water plays a crucial role in our business, from sustainable forestry to production and logistics. It is also an important source of renewable energy.

10

0

23

Target

08 19 20 21 22

Per tonne of paper Per tonne of chemical pulp

IN ACTION

SODIUM HYDROXIDE LEAK IN THE CHEMICAL STORAGE AREA OF THE NEW PULP MILL Despite our high standards of process control, sodium hydroxide, a chemical commonly used in pulp production, leaked into the water basin at the chemical storage area of the Paso de los Toros mill in August. The sodium hydroxide mixed with rainwa ter leaked from a stormwater basin through the soil into a nearby creek, causing the pH level of the water in the creek to temporarily increase. The leak caused mortality in the aquatic animals of the creek during the leak. The creek flows first into a lagoon and then into the Río Negro river, where the impact of the leak was very limited in quantity and duration. We immediately took all of the neces sary corrective measures and notified the environmental authorities and the local community about the incident. We have investigated the causes of the incident with DINACEA, the Uruguayan en vironmental authority, and have implemented all the necessary and immediate corrective measures in accordance with the authori ty’s instructions. We take all environmental deviations seriously. Our environmental management processes, controls and mon itoring systems are rigorous worldwide and incidents of this type are very rare. Uruguay’s Ministry of Environment imposed a sanction of approx. USD 188,000 on UPM for non-compliance with the environmental management plan for the pulp mill.

low to medium water scarcity. The tool also provides scenarios on water risks related to climate change for 2030 and 2050. The scenarios show that our main production sites are in areas of low to medium basin risk, with only one exception. While the UPM Changshu paper mill near Shanghai is expected to face the highest rise in water risk by 2050, the mill has made substantial improvements in water efficiency in recent years. The latest project in 2023 focused on wastewater recovery and reuse and re sulted in estimated water savings of at least 1,000 cubic metres per day. All our water risk scenarios are publicly available on our website. Continuous improvement towards 2030 targets Each pulp and paper mill has a dedicated plan to reach its reduction targets related to water use and effluent load by 2030. Several mills have started to use ad vanced process controls and predictive an alytic models to optimise their wastewater treatment plant operations. Together with the supplier, a new method based on image analysis of bio-sludges was put to use at the UPM Kymi mill and tested at UPM Kaukas

As a signatory of the UN Global Compact’s CEO Water Mandate, we follow recognised principles in water stewardship. We use water in a way that is environmentally sustainable, socially equitable and econom ically beneficial. CDP recognised UPM with an A – score for its significant actions to enhance water stewardship. water-intensive operation. Approximately 95% of the water we use in production is internally recirculated, and only a small fraction eventually leaves the process as ef fluent and needs to be replaced. Less water in processes also means using less energy and fewer chemicals. All wastewater from our pulp and paper mills is cleaned in both mechanical and biological effluent treatment processes. Pu rified water is usually returned to the same watershed from which it was extracted. According to the water risk analysis car ried out with the WWF Water Risk Filter in 2021, our production sites are in areas with Our water management Pulp and paper production is our most

IMPACT • Our measures ensure that the impact of our operations on watercourses are known and minimised so that clean water is available for surrounding communities • Our efforts to protect and restore aquatic ecosystems enhance the quality of watercourses and the natural habitat of species that live in them TARGETS • Use water responsibly • Continuously reduce the effluent load and wastewater volume generated by our operations • Use only nutrients from recycled sources in wastewater treatment

OUR WAY • Water-intensive operations in areas with sufficient water resources • Efficient water use with appropriate recycling techniques • All water-related processes managed according to the Best Available Techniques (BAT) • Best practice sharing in internal and external expert networks • Returning water to its original watershed when possible • Cooperation with local stakeholders to further improve the quality of local waterways • Focus on 2030 responsibility targets

www.upm.com/responsibility/fundamentals/ scenario-work/

TARGETS 2030 30% reduction of wastewater volumes from 2008 level

(COD) from 2008 level TARGETS 2030

40% reduction in effluent load

reduction achieved for the UPM average product

39% reduction achieved for the UPM average product

7%

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UPM ANNUAL REPORT 2023

UPM ANNUAL REPORT 2023