PepsiCo signs 10-year renewable power deal to cut Europe emissions
Deal includes suppliers Givaudan and Smurfit Westrock under a joint clean energy purchasing structure
SPAIN – PepsiCo has entered into a 10-year virtual power purchase agreement with renewable energy producer Statkraft to supply clean electricity to its European operations and reduce emissions across its wider value chain.
The electricity covered by the agreement will come from a wind project in Spain that is currently being upgraded to newer turbines and is projected to cut about 32,000 metric tons of carbon dioxide emissions each year.
Supply chain collaboration
The arrangement also brings in two of PepsiCo’s partners, ingredients company Givaudan and packaging supplier Smurfit Westrock, which joined the deal alongside PepsiCo as lead buyer to access long-term renewable energy at commercial terms typically reserved for large-scale purchasers.
PepsiCo structured the agreement with support from Schneider Electric’s SE Advisory Services, which helped design the purchasing model under the company’s pep+ Renew initiative that supports suppliers in shifting toward cleaner electricity through education and power purchase agreements.
This transaction represents the second cohort under the pep+ Renew program and also marks the first time a European group of participants has secured a virtual power purchase agreement through the initiative.
Climate strategy adjustments
The deal sits within PepsiCo’s broader PepsiCo Positive sustainability framework, introduced in 2021, which guides its emissions-reduction and supply-chain decarbonisation efforts across global operations.
According to Archana Jagannathan, PepsiCo’s chief sustainability officer for Europe, the Middle East and Africa, the company is working with its value chain partners to expand access to renewable energy solutions and speed up the transition to cleaner electricity systems.
In parallel with these efforts, PepsiCo revised its long-term climate roadmap, shifting its net-zero target from 2040 to 2050 and replacing its emissions baseline year from 2015 to 2022, as part of a wider strategic update.
The company’s 2023 sustainability report indicated it was not on track to meet its 2025 environmental targets, prompting further revisions to packaging sustainability plans and the setting of new emissions-reduction goals for 2030.
Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.
