Nippon Paper (Japan) has agreed with Sojitz Corporation to jointly establish a power generation company "Yufutsu Energy Center, LLC" (hereinafter "Yufutsu Energy Center") and conduct a power generation business with biomass mono-fuel combustion, utilizing the feed-in tariff (FIT) system for renewable energy.

Yufutsu Energy Center plans to install power generation facilities using part of the premises of Hokkaido Mill owned by Nippon Paper Industries. Hokkaido Mill (Yufutsu) will start construction work in March 2020 to commence operation by the end of FY2022. The fuel to be used will be fuel-grade woodchips and palm kernel shells (KPS) mainly procured from overseas as well as unused woody materials in Japan. Nippon Paper Industries will be entrusted with the operation and maintenance of the power generation facilities. The generated electricity will be sold to Hokkaido Electric Power Co., Inc.

In advancing the transformation of the business structure, Nippon Paper Industries is focusing on the energy business, utilizing the technology and know-how in power generation it has cultivated in its paper mills. The Yufutsu power generation business with biomass mono-fuel combustion, launched jointly with Sojitz, can ensure long-term stable profitability by utilizing the premises, facilities and skilled human resources at Hokkaido Mill (Yufutsu). With this business, under the slogan of "shaping the future with trees," Nippon Paper Industries will promote the use of wood biomass in the energy business field, which leads to reductions in CO2 emissions, and will expand the business while contributing to the stable supply of electricity and development of Hokkaido.

Outline of the Yufutsu Energy Center

1. Company name: Yufutsu Energy Center, LLC

2. Location: Yufutsu, Tomakomai-shi, Hokkaido [Inside Nippon Paper Industries Hokkaido Mill (Yufutsu) premises]

3. Founded: February 14, 2019

4. Nature of business: Biomass power generation business

5. Investment ratio: Nippon Paper Industries 51％、Sojitz Corporation 49％

6. Fuel: Imported woodchips, palm kernel shells, Domestic unused woody materials

7. Power generation output: 74,950 kW (generating end)

8. Commencement of work: March 2020 (planned)

9. Start of power generation: January 2023 (planned)