Update On Environmental and Regulatory Issues

1. Update On Environmental and Regulatory Issues • Gary Jones, Assistant VP EHS Affairs Printing Industries of America • Bill Upton, Vice President of Operations Edwards Brothers Malloy • Jac Garner, President Webcrafters

2. Today’s Agenda • Update on BMI/AAP Task Force • Examining “Environmental Best Management Practices” • Update on Sustainable Green Printing Partnership • Webcrafter’s experience • Update on various ENGO activities • Changes in government regulations • Air pollution control requirements • Q&A

3. BMI/AAP Task Force • Goal is to develop “environmental best practices” for book manufacturing • Two elements – product and manufacturing process • Two meetings have been held • Most recent was on October 22nd • Conversations have focused more on general topics of interest • Additional conversations are necessary to formulate a strategy

4. Launched August 28, 2008! www.sgppartnership.org Eligible Companies – US and Canadian Printers, packaging, newspapers, in-plants, schools Binding, finishing, and loose leaf operations Applies to individual facilities Participation so far…. Sustainable Green Printing Partnership

5. Sustainable Green Printing Partnership What is the SGP Partnership? • Independent Nonprofit Certification Organization • Credible system identifying “Sustainable Green” graphic arts facilities for customers and consumers • Third-party audit required for certification • Holistic approach to the development & certification of sustainable business practices • Publically vetted criteria defining “Sustainable Green” printing facilities • Finished Product Responsibility • Environmental Responsibility • Social Responsibility

6. Sustainable Green Printing Partnership Being Certified Means a Company… • Has undergone a Third Party Certification Audit • Works with customers on options for products • Is in compliance with all relevant health, safety and environmental regulations • Developed and implemented a Sustainability Management System (SMS) • Conform to Best Management Practices • Supply Chain, Production Operations, Facility-wide, and Employment • Annual continuous improvement project • Tracking key sustainability metrics • Submit an annual report

7. Sustainable Green Printing Partnership Webcrafters Experience With SGP Certification • Why Webcrafters became certified • Value and benefits to customers, operations, and employees • Certification process • How it was accomplished internally • How much time and effort did it take • What was the cost

8. Book Industry Environmental Council(BIEC) • Founded: 2008, by: • Green Press Initiative (GPI) • Book Industry Study Group (BISG) • Mission: • Identify, foster, and communicate best practices to reduce the environmental footprint and increase the sustainability of books, both printed and electronic. • Reaffirmed in 2012 member survey

9. BIEC Initiatives • Publisher Environmental Certification Program • Abandoned 2011 • Picked up by GPI • List of certified publishers not yet available on GPI site • Track trends of book industry environmental practices • Set goals for reducing greenhouse gas emissions • 20% reduction from 2007 to 2020 • 80% reduction from 2007 to 2050 • Reduce returns and keep books out of landfills

10. BIEC Member Survey • Keep pursuing initiatives 2, 3, 4 • Don’t recalculate industry carbon footprint in ‘13 • 17% wanted to, 25% didn’t, others neutral • Want more actionable plans • Provide member education via speakers/webinars • Environmental regulations • Industry best practices • Hold meetings onsite at member companies to see first hand • Global dynamics of recycled fiber • Develop data on impact of e publishing

11. 2012 Tracking Report • Report drafted • May not be released due to member concerns • Data could be skewed depending on which companies participated in survey • Some information was speculative • “this could be due to…” • Publication uncertain at this time

12. BIEC Administration • GPI serving as paid administrator of BIEC • 6 month trial

13. Canopy Green Printer Initiative • Initiated a search in July 2012 to find North America’s Greenest Printers • Created11 page survey covering variety of topics • Paper procurement and management (extensive) • Sustainability policy and reporting • Certifications • Process questions – soy inks, energy conservation, pollution reduction, renewable energy, waterless, etc. • Final report or listing not published

14. Green America Better Paper Project • Program started in 1982 focusing on Magazine Publishers • Purpose to help magazine publishers choose sustainable papers (recycled and certified) • Refers to Canopy List of “Green Printers” • July 2012 “Green In All Grades” White Paper • Debunks recent myths and proves that recycled paper is always the best environmental choice, especially when used in magazines.

15. Paper Calculator Managed by EPN • 2011 Environmental Defense Fund transferred Paper Calculator to the Environmental Paper Network • Revised in August 2012 (Version 3.2) • More completely capturing the life cycle water use of both recycled and virgin fiber • Updated national average data on mill performance • Calculates the environmental savings of both post-consumer and pre-consumer recycled content • Updated decomposition rates for each of the paper grades based on new data • http://calculator.environmentalpaper.org/resources_and_tools

16. Toshiba No Print Day • In early June, Toshiba announced National No Print Day on October 23, 2012 • Urged offices to not print or copy • To raise awareness “of the impact printing has on our planet” and of "the role of paper in the workplace • After pushback from industry, Toshiba cancelled National No Print Day

17. The Value of Print http://value.printing.org/

18. FSC Update • Chain of Custody - effective October 1, 2011 • New declarations for social, health, and safety requirements • New declarations for illegal forest products and other harmful forest practices • Declaration requirement has triggered negative response from printing and paper companies • Response being organized to approach FSC to exclude North American companies from new requirements • PIA “uninvited” from standards review committee

19. FTC Green Guidelines • New Guidelines announced October 1, 2012 • Last updated in 1998 • Includes revisions on existing guides and new sections • Revised Claims • GeneralEnvironment Benefit • Compostable and Degradable • Recyclable and Recycled content • Ozone safe or ozone friendly • New Sections • Carbon offsets • “Green” Certifications and Seals • Renewable Energy and Renewable Materials Claims • Free of and Non-toxic • Topics not covered • Use of the terms Sustainable, Natural, and Organic

20. FTC Green Guidelines Revised Claims • General Environmental Claims • Claims should include clear and prominent qualifying language, not general environmental claims such as “eco-friendly” that cannot be substantiated. • Compostable • Need competent and reliable scientific evidence that all materials will breakdown into or become part of usable compost safely and timely. • Should qualify compostable claims that cannot be composted at home safely or timely, and if it can be composted in a municipal or institutional facility if they are not available to a majority of consumers.

21. FTC Green Guidelines Revised Guides • Degradable • Can make an unqualified claim only if it can be proven that the entire product or package will break down and return to nature within one year after customary disposal • Items destined for landfills, incinerators, or recycling facilities will not degrade within a year, and cannot be claimed as biodegradable. • Recyclable • Must qualify recyclable claims when recycling facilities are not available to at least 60% of consumers or communities.

22. FTC Green Guidelines Revised Guides • Recycled Content • Make recycled claims only for materials recovered or diverted from waste during manufacturing process or after consumer use • Qualify claims for products or packages made partly from recycled material • Qualify products containing used, reconditioned, or re-manufactured components to avoid deception • Ozone friendly or safe • Claims cannot misrepresent a product as ozone-friendly or safe for ozone layer

23. FTC Green Guidelines New Sections • Carbon Offsets • Unqualified carbon offset claims should refer to emission reductions that have occurred or will in the immediate future • Any claim that will not occur for two years or longer should be explicitly qualified • Claims are not permissible for reductions or activities resulting in reductions required by law • “Green” Certifications and Seals • Unqualified certifications or seals of approval should clearly state they apply to specific benefits • Use of a third party certifier’s name, logo, or seal of approval must comply with FTC’s Endorsement Guides

24. FTC Green Guidelines New Sections • Renewable Energy Claims • Unqualified claims cannot be used where power derived from fossil fuel is used to manufacture any part of the product or service • Claims are not permissible where manufacturer generates renewable energy but sells renewable energy certificates for all of that electricity • Renewable Materials Claims • Where necessary, claims should be qualified by specifying the material used, how the material is sourced, and why the material is renewable

25. FTC Green Guidelines New Sections • Free-of and Non-toxic Claims • Product cannot contain more than trace amounts or background levels of a substance • Amount of substance present does not cause harm that is associated with the substance • Substance was not intentionally added to product • Product cannot use substance that poses same or similar environmental concerns as removed substance • Removed substance is not one associated with the product category

26. FTC Green Guidelines First FTC Enforcement Action • October 26, 2012 settlement with Sherwin Williams and PPG for charges on misleading “Zero VOC” claims on paint can labels and promotional material • Claimed “Zero VOC” paints • Mixing bases contain no or trace VOCs • Colorants used to tint added enough VOCs negating claim • Sherwin Williams included a disclaimer on their product • FTC ruled not sufficient due to VOC added by colorant • Must stop current advertising and must have material available for review by FTC

27. FTC Green Guides Avoiding An FTC Enforcement Action • Be clear and specific about environmental-benefit claims • Marketing message should be clear and prominent, and whether the claims apply to the product, packaging, or component • Must not overstate or use general environmental claims • Be careful about using environmental certifications and seals of approval in advertising • Certifications and seals considered endorsements • Must be truthful and substantiated

28. FTC Green Guides Avoiding An FTC Enforcement Action • Keep marketing and compliance departments on the same page • Substantiation for a claim must be on hand before the claim is made • Marketers and compliance officers should work together and have a sharp focus on corporate compliance • Check the Green Guides carefully before using any green term • http://business.ftc.gov/advertising-and-marketing/environmental-marketing

29. The Lacey Act • The Food, Conservation and Energy Act of 2008 • Passed May 22, 2008 (effective immediately) • The Lacey Act makes it unlawful to import, export, transport, sell, receive, acquire, or purchase in interstate or foreign commerce any plant, with some limited exceptions, taken or traded in violation of the laws of the U.S., a U.S. State, or most relevant foreign laws • Can be a “knowingly” or “unknowingly” participant • Examples of relevant underlying foreign law violations • Theft of timber, including from parks and protected areas • Harvesting without permission • Failure to comply with harvesting regulations • Failure to pay royalties, taxes or fees

30. The Lacey Act • Exercise “Due Care” when purchasing paper • “Due care means that degree of care which a reasonably prudent person would exercise under the same or similar circumstances.” • Due care applied differently based on expectations • Useful tools to demonstrate due care • Asking questions • Compliance plans • Industry standards • Records of efforts • Changes in above in response to practical experiences

31. Lacey Act • In 2008 and 2009 wood from Gibson guitar was seized and company investigated for violating Lacey Act • Illegally purchasing and important ebony wood from Madagascar and rosewood and ebony from India • August 6, 2012 settlement with DOJ • Penalty of $300,000, donate $50,000 to the National Fish and Wildlife Foundation, and implement a compliance program • Gibson will withdraw its claim to the wood seized with a total invoice of $261,844.

32. State Air Pollution Control Regulations 85 Counties

33. Ozone Nonattainment Areas

34. What is a CTG? Control Techniques Guideline • Not a national regulation • Guidance containing “recommendations” by EPA to States on how to control VOC emissions • Sets Reasonably Available Control Technology limits • Applies to printers in ozone nonattainment areas • Moderate, Serious, Severe, and Extreme • Ozone transport region (Northern VA to Maine) • States with ozone nonattainment areas must adopt new regulations or revise existing ones.

35. Who Does The CTGs Apply To? Applicability • Printers in moderate or worse ozone nonattainment areas • Can be nonattainment area only or statewide • 15 lb/day actual VOC emissions before controls • Ink, Fountain Solutions, Coatings, Cleaning Solvents • EPA said states could use 450 lbs/mo or 3 tpy • Unless monthly or annual-then daily recordkeeping • States must have any other threshold approved

36. Lithographic/Letterpress CTG Inks, Varnishes, and Coatings • Sheetfed and Nonheatset Web • No VOC content limits or reformulation required • UV/EB cured classified as “nonheatset” • 95% VOC retention factor for conventional inks and varnishes • HeatsetWeb • No VOC Content Limits or Reformation Required • Reduce VOC emissions add-on control device • 20% VOC retention factor for conventional inks and 100% capture in dryer

37. Lithographic/Letterpress CTG Inks, Varnishes, and Coatings • Considered part of printing process not subject to paper coating regulations • Varnishes • Unpigmentedinks and treated the same as inks • Water-based & UV/EB cured • Minimal VOC emissions • No VOC content limits or reformulation required

38. Lithographic/Letterpress CTG Inks, Varnishes, and Coatings • Heatset web add-on controls (oxidizer) • Any press with potential ink oil emissions greater than 25 tons per year • 31.25 tons per year considering 20% retention • Book and presses 22 inches in width or less are exempt • Control efficiency • 90% for all existing control devices • 95% for all new control devices installed after state rule date • VOC outlet concentration of 20 ppmv (hexane) or less

39. Lithographic/Letterpress CTG Fountain Solution • Sheetfed • VOC limit of 5% by weight VOC with no refrigeration or • VOC limit of 8.5% by weight if refrigerated below 60o F • Limits are on an “as applied” basis (press ready) • Nonheatset Web • No IPA • Alcohol substitute limit of 5% by weight • Limits are on an “as applied” basis (press ready)

40. Lithographic/Letterpress CTG Fountain Solution • Heatset Web • IPA limit of 1.6% by weight with no refrigeration or • IPA limit of 3% by weight if refrigerated below 60o F • Alcohol substitute limit of 5% by weight • Limits are on an “as applied” basis (press ready) • Allows 70% carryover of substitutes into HSWO dryers

41. Lithographic/Letterpress CTG Cleaning Solutions • Applies to all printing press cleaning activities • Blanket wash, roller wash, metering roller, etc. • Limits • 70% weight VOC content limit, or • VOC composite vapor pressure limit of 10 mm Hg at 20oC • Requires closed containers for towels and solutions • Allows 50% shop towel retention factor for washes meeting low vapor pressure limit • Allows 40% carryover for ABW into HSWO dryers

42. States With Existing/Revised LithoRules

43. States Without Final Litho RACT Rules

44. Industrial Solvent Cleaning CTG Operational Limits • Digital operations are exempt • Except Utah and Georgia • Low VOC content • 50 grams/liter (0.42 lbs/gal) • Low vapor pressure • Less than 8mm Hg at 20oC (68ooF)

45. Industrial Solvent Cleaning CTG Required Work Practices • Cover open containers • Minimize air circulation around cleaning operations • Properly dispose of used solvents and shop towels • Implement equipment practices to minimize emissions

46. States With Existing/Revised ISC Rules

47. States Developing ISCR Rules States With No Current Plans for ISC Rules