Our ambition is to be one of the most sustainable beverage company and to be the preferred choice for the future. We will convert our energy consumption to renewable energy in the entire value chain and we will work with our partners on reducing CO2 emissions and lowering the impact from packaging material through recycling, while having a positive social impact. We will reach our targets by:
Shifting to renewable energy
Engaging with our entire value chain
We will increase our renewable energy use towards 2030, starting from our own production and gradually increasing demands on suppliers.
Royal Unibrew is setting ambitious targets on carbon emissions. From our own production (scope 1 and 2) we aim at being carbon emission free in 2025, and for the entire supply chain reducing our footprint by at least 50% in 2030. We have decided on several initiatives to reach these ambitious targets, but we also acknowledge that implementation of new, not yet available technologies, are key to succeed. For the multi-beverage industry, the main part of the CO₂ footprint is ’outside the fence’. Therefore, we need to work not only on scope 1 and 2 ‘inside the fence’ but as well on scope 3 ‘outside the fence’.
Royal Unibrew’s principles for reducing carbon footprint is to work continuously with optimizations to increase energy efficiency. Based on the general consensus on the need to transform and electrify production processes, we will apply and invest in new technologies, when available and commercially viable. Investing actively in or pushing for additionality of renewable energy in the grid is included as well. The most pertinent challenge for the industry is transforming thermal processes to power-based processes. The technologies to heat/cool efficiently by power are, however, not available, yet.
- Transform and electrify production
- Demand renewable energy in the supply chain
- Optimize energy and water consumption
Principles for reducing CO2 emission from production is:
- Reduce energy consumption/increase energy efficiency
- Investing in transformation of thermal energy to electrical energy
- Actively invest in or push for additionally of renewable energy in the grid
- As a last resort and in the short to medium term either source renewable energy power or biogas or buy accredited certificates
Our ambition to become emission free or reducing the impact significantly will also translate into new demands for our suppliers and partners across the entire value chain. Potential symbiosis and new business models in our local communities which also links into product circularity will also be part of the solution.
To support the transition towards using renewable energy we are investigating the possibility of constructing a solar park, covering our Danish power consumption, and in Finland, we are investigating solutions using geo-thermal energy for heating and for biogas replacing natural gas in our boilers.
Transportation is another area where technologies for heavy duty transportation still are rather immature. The offering and availability of renewable fuel sources are gradually increasing but there are still major technological challenges in becoming carbon emission free. The industry currently estimates a potential of 30% reduction in 2030. Royal Unibrew is currently looking at fossil free fuels as transitional options as well as electric or hybrid vans/cars for lighter duty. Forklifts and other ‘inside the fence’ distribution is primarily power-based today.
In 2020, the CO₂ impact from production, packaging materials and distribution was 36, 143, 30 million kg CO₂, respectively. Essentially unchanged from 2019 in absolute amount but with an improvement per produced unit of 2 to 3% for transportation and packaging material. The reduction for packaging materials is triggered by increasing the content of recycled material.
The carbon footprint for our production was reduced by 22%, measured as kg CO₂ per produced volume, from the base year 2015 to 2020. Being above our 2020 target of 15% CO₂ reduction and showing we are on the right track for our target of 30% in 2022 compared to 2015. Between 2019 and 2020, the kg CO₂ per produced volume decreased with 12%. The CO₂ reduction is a result of phase 1 of energy optimization project in Lahti in combination with a shift in product mix, i.e. during the pandemic there has been a significant increase in the soft drink production volume relative to beer production.
Water is our most important raw material and therefore water preservation and water quality are key to us. All our wastewater is treated before emission either at our site or at the municipal treatment plant to meet the requirements. Reducing water consumption remains a priority to us and the consumption of water per hl has decreased by 4% from 2015 to 2020 and in a like-to-like comparison with 10%. Royal Unibrew’s production facilities are not located in water scarce areas, and some of our sites do not have full separation of rainwater and process water, resulting in a larger wastewater discharge than actual. And at our site in Italy, we use well water for the last rinse in the cleaning process and it is essentially not contaminated water but is accounted for as consumption. We only use municipal or own well water at our sites.
We want to become circular across the value chain by engaging suppliers. We will close the material loop, reduce the strain on resources and reduce our footprint.
In the beverage industry product circularity depends to a high degree on closing the loop for packaging material (primary, secondary and tertiary). The elements are to remove, reduce, reuse and recycle material.
The food safety requirements for primary packaging material (e.g. glass bottles, PET bottles and cans) are stringent as it is key to protect our products. The entire packaging system, e.g. bottles, crates, trays and wraps ensures there is no harm to our products during distribution, and packaging is therefore key to product protection and avoiding food waste. Thus, the packaging systems are complex, and substituting or eliminating elements such as plastic wrap or down-weighting require careful testing to ensure continued stability.
We continuously cooperate with our suppliers on reducing the weight of material/amount of material used per item. We have already reduced PET weight by 20% over a 10-year period and reduced aluminum in cans by 5%. In our secondary system, cardboard is being reduced as well. The work continues and we are in a process of setting concrete targets together with our suppliers.
Furthermore, we have worked on increasing the amount of recycled PET in our bottles for several years. In 2019, we set short term targets for 2020 and 2022 for selected categories and with our new strategy, we are setting even higher ambitions with a target of 100% recycled material for more categories in 2025 and even more by 2030. We estimate that the transitioning from virgin to recycled packaging will reduce our CO2 footprint for packaging material by more than 40%.
It is our target only to offer products in recyclable packaging in all our markets by 2025. In principle, we only use mono materials today. Mono materials can easily be separated, sorted and recycled in clean fractions such as glass, PET, carton, aluminum, steel and shrink film. However, our juice portfolio, contributing 0.001% of packing materials in 2020 on weight basis, is currently provided in coated carton, i.e. more complex laminated materials. While the recyclability of that particular material may be improved over the next couple of years, we will however, also be looking at alternatives.
Reuse of materials is also an important part of ensuring product circularity. There is well-established reuse systems for packaging material in several of our markets, e.g, return systems for glass bottles, crates, steel kegs and pallets. However, such systems are not in place in all markets. Well-functioning deposit return systems (DRS) are in place in Denmark, Finland and Lithuania and similar systems are currently being discussed in France, Latvia and Italy. We will continue our support to DRS in our major markets to increase the return rate further and look for solutions to avoid packaging wasting in other markets with more immature systems.
- Eliminate unnecessary packaging (incl. plastics)
- Source recycled packaging material
- Become the sustainable partner
100% recycled PET
Use of recycled packaging material has been increasing over the last couple of years – and will increase significantly towards 2025. For example, our Egekilde water brand is now in 100% recycled PET, Lapin Kulta and Royal Organic is packed with 100% recycled shrink film, Ceres is with 100% recycled paper labels and our Faxe Kondi Booster in 100% recycled corrugated trays.
We engage with our entire value chain to reduce carbon emissions in scope 3 and minimize negative environmental impact, including biodiversity, and social impact.
We have a large share of our footprint (environmental and social) outside our own direct control, and at the same time consumer awareness about impacts of the supply chain footprint is increasing. Therefore, we engage with our supply chain to reduce the footprint and to increase supply chain transparency.
We aim to ensure that our suppliers meet our high standards. In 2020, approximately 60% of our suppliers of direct material have signed our code of conduct. We want to further develop our responsible sourcing principles by establishing a set of specific requirements. The principles will also encompass requirements for CO2 emission reduction targets for the suppliers as more than 80% of our carbon footprint is ‘outside our fence’.
By 2030, the target is a 50% reduction of the supply chain emissions and no later than 2023 all Royal Unibrew’s critical suppliers should have signed the responsible procurement principles and an agreement with a defined road map to reduce their carbon footprint.
In 2020, we have had preliminary meetings with selected suppliers regarding their goals and initiatives. This in combination with the current general consensus on possible technological advances in the relevant sectors until 2030, makes us believe it is a realistic target.
Royal Unibrew has always cooperated closely with suppliers and other partners to improve our products as well as production and process performance. To reach our targets, it is pivotal on the one hand to build on these well-established relations and strengthen them further and on the other hand to identify and establish new partnerships for sustainable development.
- Further develop responsible procurement principles
- Road map for CO₂ reduction in transportation, packaging, agriculture and sales refrigeration
We aim to ensure that our suppliers meet our high standards. In 2020, approximately 60% of our suppliers of direct material have signed our code of conduct.