Beverage Sector Taking the Lead on Carbon Management

October 11, 2018 | BIER

Competitors Coming Together to Chart a Strategic Course for the Future

The beverage sector is facing increasing stakeholder pressure to be more productive while also consuming less energy and reducing carbon emissions. The good news is that there are considerable opportunities to improve energy efficiency and reduce greenhouse gas (GHG) emissions—if we come together to tackle the challenges standing in the way.

More than a decade ago, some of the world’s largest and niche beverage organizations came together to do just that, and the Beverage Industry Environmental Roundtable (BIER) was born.

Since our inception, BIER members have been working together to identify key challenges and opportunities in energy and carbon management, share best practices, and develop strategies that can elevate sustainability within their own companies and across the beverage sector.

We’ve established guidance for GHG emissions reporting (with an update in the works!), developed an energy use benchmarking study, mapped the carbon footprint of multiple beverage types—and the list goes on. Now, we’re turning our attention toward creating a collaborative, future-focused roadmap for better carbon management.

Recently, five of our member representatives came together for a Q&A session to discuss roadblocks, what they see as the “collaboration imperative,” and how they hope to make an impact. Those members include Richard Profit of PepsiCo, Paul Bruijn of HEINEKEN, Julien Gervreau of Jackson Family Wines, Geert Huysmans of The Coca-Cola Company, and Eskild Andersen of Carlsberg Group. See what they had to say below.

The Challenges

Q: What do you see as some of the greatest energy and carbon management challenges facing the beverage industry? Beyond the sector?

Richard Profit (PepsiCo): The supply chain. More specifically, influencing and working across the supply chain, particularly when it comes to agricultural emissions—especially in the developing world. I also think there’s a challenge around emissions associated with packaging.

Within operations, I think the challenge is really going to be around renewable heat and fuels. Renewable electricity is pretty much sorted. Yes, there are some balancing and design issues, and issues around battery storage and pricing, but we’re in a pretty good place there. Technically speaking, however, we haven’t yet achieved scalable solutions for renewable heat. We can electrify heat, but gas is still too cheap at the moment, so it’s hard to justify the cost.

Paul Bruijin (HEINEKEN): The “Barley to Bar” impact. For HEINEKEN, the challenging hotspots are one-way packing materials and cooling our products in the market. We do buy the freezers on our own and we can make them very efficient, but it’s still top of mind. So, dealing with one-way packaging is probably the greatest challenge for us.

Julien Gervreau (Jackson Family Wines): Agriculture. But I think it’s both a challenge and an opportunity. Obviously, beverages contain many agricultural ingredients, and farming has historically been carbon intensive. In addition, energy efficiency and management within the supply chain is a challenge. Looking beyond the sector, transportation is a challenge, but also another opportunity.

Geert Huysmans (The Coca-Cola Company): In my perspective, one of the most important challenges comes from the evolution of consumer preferences to more natural, less industrialized products. That shift imposes a demand for fruit- and plant-based beverages using ingredients that frequently have higher environmental impacts.

Beyond the manufacturing process, other challenges that the beverage industry faces come from cooling equipment, packaging materials, and sustainable agriculture practices.

Eskild Andersen (Carlsberg Group): I agree with all that’s been said, especially managing indirect emissions from our activities, such as the items that fall under the Science-Based Targets initiative’s (SBTi) Scope 3—especially packaging. The challenge is to drive change at a pace that is fast enough. Climate scientists say we have around 17 years to reduce our emissions enough to avoid severe negative impacts of climate change, so I think our biggest challenge is to speed up our actions.

The Opportunities

Q: Where do you think the greatest opportunities lay? (e.g. emerging technologies, local partnerships, supply chain, etc.)

Richard (PepsiCo): Supply chain collaboration. I’m very much human-centric in my approach to sustainability. I think we need to get collaborations up and running, we need to catalyze a will to make the change and stir up the passion in people across our supply chain. If we can encourage the demand for new solutions, the technology will follow. It starts with the people.

Paul (HEINEKEN): Absolutely. Collaborations and partnerships are key. We have a clear methodology to calculate impacts—we know what data points are relevant, we know the parameters we need to measure, and so on. But we’re looking for suppliers that contribute, especially when it comes to packaging. At HEINEKEN, we want to continue to use glass, aluminum, and PET. But it also means that these materials need to be manufactured with renewable fuels, similarly to what we do in our operations. If we do this, it enables our industry to comply with stakeholder expectations and the Paris Agreement.

Julien (Jackson Family Wines): Yes, collaboration is a must, and as a related opportunity, looking at how we can leverage agriculture as a carbon sink. I’ve spent the last few months taking a deeper look at how we can enhance soil health in accordance with principles that sequester carbon dioxide in the soil, such as spreading compost, planting cover crops, and reducing tillage. The potential is tremendous.

We’re just starting to get a full understanding of what we can do, but this will be a huge growth area over the next five to 10 years. Of course, we’ll need to work with regulatory agencies and policymakers to incentivize farmers to use carbon sequestration practices, but I think this is a huge opportunity.

For Jackson Family Wines, when it comes to technology opportunities, we’re looking at our wine fermentation tanks as another source for future carbon sequestration, because fermentation creates a highly-concentrated source of ethanol and carbon emissions. So, we’re looking for ways to capture those emissions in solid form and use them as building blocks for reinvesting back in the soil or stimulating other activities. Thinking about things in closed loops is a great way to unlock innovation.

Geert (The Coca-Cola Company): The most significant opportunity we have ahead of us is to collaborate with partners within our supply chain, to work cohesively in programs oriented to have a larger impact on carbon emissions reduction.

Eskild (Carlsberg Group): Collaboration is the spirit of BIER. In our sustainability program, Together Towards ZERO, we clearly outline partnerships as absolutely key to achieving truly sustainable development and engaging our suppliers and other partners to create a virtuous circle of carbon reduction—it is one of the most important tasks we have. For example, we have a target to reduce emissions in the value chain by 30% by 2030. We are sure that we can have a significant impact together to clear a path to a low-carbon economy.

Where BIER Comes In

Q: How are BIER members working collaboratively to recognize key challenges and prioritize high-impact opportunities? And how will you take the work you’re doing back to your respective companies?

Richard (PepsiCo): We’re working on integrating European PEF and science-based targets into BIER guidance, which will be important and useful work for all members and the industry. Currently, our roadmap has the appropriate focus on agriculture and packaging hotspots. However, just measuring doesn’t deliver anything.

A key BIER focus moving forward will be to identify best practices and to host and facilitate supply chain collaborations that actually garner movement. I hope PepsiCo will play a key role in facilitating and protecting those collaborations.

Paul (HEINEKEN): We want to drive improvements within our internal operations and on the supplier side. After careful study, research, and debate by BIER members and other groups, we can prioritize what we’re doing as an industry and what we’re doing as individual companies.

Julien (Jackson Family Wines): Another thing we’ll be looking at is how we can stimulate and galvanize conversations with regulating bodies and agencies and farmers. BIER can serve as a catalyst for developing protocols and monetizing opportunities for farmers, which would be tremendous.

As for how this work can impact Jackson Family Wines, if we can align our efforts with BIER, we can add teeth to the work we do. We can have a greater impact as a collective group than one small winery in the room.

Geert (The Coca-Cola Company): BIER members often use this platform as a way of sharing experiences and programs that succeeded or failed. We can all learn from others’ experiences, especially within an environment that promotes a technical knowledge exchange based on trust.

These are three ways on how this work strengthens our activities at Coca-Cola: collaborative work will help us complete carbon calculations more efficiently this year, we reduce risk to the company by incorporating industry approaches and trends to our programs; and lastly, we become more efficient and competitive when we benchmark programs with other companies, learning from their best practices.

Eskild (Carlsberg Group): We find strength in sharing the work and using the joint mindset of BIER experts from across the world to further improve. With Together Towards ZERO, Carlsberg Group has taken a major step towards a sustainable future. But we know that working with others to achieve our target of zero carbon emissions at our breweries by 2030, for example, can contribute to us getting there faster and better.

Be Part of What Happens Next

Our members recognize the significant carbon management challenges that exist, as well as those that have the potential to intensify over time. But they’re also incredibly optimistic about the opportunities before them—and that together as an organization, and with existing and new partners, meaningful change can happen.

We want to take the lead on carbon management for the beverage sector, but to do that, we need to collaborate with progressive thinking partners focused on meaningful actions.

If you want to learn more about partnership opportunities, get in touch with us today. In addition, check out the work we’ve already done on energy, carbon management, and climate change.

The Beverage Industry Environmental Roundtable (BIER) is a technical coalition of leading global beverage companies working together to advance environmental sustainability within the beverage sector.
By BIER [crp]

The Beverage Industry Environmental Roundtable (BIER) is a technical coalition of leading global beverage companies working together to advance environmental sustainability within the beverage sector. Formed in 2006, BIER is a common voice across the beverage sector, speaking to influence global standards on environmental sustainability aspects most relevant to the sector, affect change both up and down the supply chain and share best practices that raise the bar for environmental performance of the industry. By doing so, BIER is able to monitor data and trends, engage with key stakeholders, develop best practices, and guide a course of action for the future.

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