by Chris Daly, VP, Supply Chain, Strategy, Transformation and Sustainability at PepsiCo.
The COVID-19 pandemic has put unprecedented strain on our food system in unexpected and lasting ways. It has also reshaped people’s view of what is possible and given many businesses, including PepsiCo, a renewed sense of urgency towards long-term sustainability goals.
We recently launched our annual sustainability report, which reports our progress towards building a more sustainable food system. A big part of that is reducing emissions in our supply chain. The global food system we are part of is responsible for around 30% of greenhouse gas (GHG) emissions. Businesses such as ours, with far-reaching global supply chains, have a significant responsibility, and opportunity, to reduce the environmental impact of food production, from how it’s grown to how it gets onto shelves.
Our goal is to reduce GHG emissions across our business and we’re making good progress. But we recognise that more needs to be done as we want to play a key role in helping Europe achieve climate neutrality by 2050. This is one of the reasons we recently signed the UN’s Business Ambition for 1.5°C pledge. This ambitious target will require a step-change across our entire value chain.
Precision agriculture technology to improve farming efficiency
Through our Sustainable Farming Programme, we work with more than 1500 farmers in the Europe region, providing support through technology and practices that create efficiencies and reduce environmental impact. This helps build resilience in our crops and enables our farmers to deliver higher yields, using fewer resources.
We continue to build on the crop monitoring technology we co-developed with Cambridge University, empowering farmers to use the latest mobile and web-based capabilities to monitor potato fields in 14 markets across Europe. Through capturing in-field data we’re helping farmers manage challenging climate events, such as the storms last year in harvest season, as well as optimise water and fertiliser use.
As we look to the future, we will be taking what we’ve learnt with farmers who we directly source from and look to expand that knowledge out to indirect suppliers to scale our solutions further.
Curbing greenhouse gas emissions across our manufacturing process
Emissions produced during manufacturing are in our direct control and we’ve made a significant effort not just to invest in renewable electricity sources, but also to use the power of our teams to drive behavioural change and promote more efficient methods.
In 2019, we achieved 100% renewable electricity in nine European markets and added on-site solar energy at plants in five European countries.
We continue to innovate in this area. We recently commenced operations at our new Alvalle gazpacho plant in Spain which has been designed to produce more, using fewer resources. The plant will reduce energy consumption by 20% and water consumption by 30% compared to the previous plant and will have virtually zero waste. These improvements have been delivered due to the use of natural lighting, the high efficiency of energy equipment in all areas, and the recovery of rainwater, which can be used for garden irrigation and road cleaning. The new plant also uses electricity from 100% renewable sources and incorporates high-efficiency boilers, solar panels for hot water and photovoltaic panels for electricity generation.
Creating a circular economy to reduce the carbon intensity of our packaging
We know that packaging is a significant contributor to carbon emissions, which is why we’re driving to create a circular economy so less of our packaging becomes waste and in turn, we can reduce the carbon intensity of our products.
To do this, we’re working across a couple of areas. Firstly we’re reducing the amount of plastic we use through new innovation such as trialling technology called “charge compaction”, which causes snacks to settle to the bottom of the bag during packing, meaning we can use less packaging for our crisps. We’re also ensuring more of our packaging is recycled and continue towards our goal of using more recycled content in our drinks bottles across the EU. Finally, we’re working to reinvent our packaging by looking at new materials and models.
As part of our work to innovate in this area, we’re taking part in several pre-competitive consortiums and partnerships. One such consortium is with Carbios, who is pioneering a new enhanced recycling technology using a biological enzyme to break down all kinds of PET into its original building blocks, which are then used to produce high-quality recycled PET plastic – the breakthrough technology will mean that more plastic can be recycled and will not end up as waste.
Cutting emissions across our distribution process
We’re keen to find new ways to tackle emissions across our supply chain, and our distribution networks provide an opportunity to do this. This involves investing in new, cleaner transport options, as well as load maximisation and empty kms reduction.
For example, we are implementing a planning system to enable further load and network optimization and a further reduction of emissions. Projects are in place in Spain, Poland, Romania, Russia and the UK, which essentially work out how loads from suppliers can be combined with loads for customers to increased efficiency of transport.
Alternative transport options are also playing a role in Europe. We have a strong rail network, and this is being used instead of road transport where appropriate to lower our carbon footprint. Finally, whilst electric infrastructure develops across most of our European market, we are focusing on trials of trucks which are more CO2 efficient than traditional vehicles.
There’s no silver bullet solution to creating a sustainable and resilient food system but we are confident that we’re progressing well in this area. However, we know that this is just the beginning of what we must do. Our mission now is to focus beyond our own impact and look even further to the emissions we indirectly generate through our wider supply chain. We need to learn from the lessons of the COVID-19 pandemic, which continues to impact all of our lives, including causing challenges across the food system. With climate change an ever-increasing threat, it’s essential that we act now to avoid a future of disruption.