Coca-Cola Enterprises, the world’s largest soft drink bottler, is known for red, but these days the company is seeing green. The company announced a set of long-range sustainability goals under the banner “Commitment 2020” that include a 15 percent carbon emissions reduction, water neutrality, and recovering and recycling the equivalent of 100 percent of the packaging it puts in the marketplace, all in the next 10 years.
CCE says the program is the right thing to do for the environment, and it also is proving to be a strong business strategy as it creates production efficiencies and cost savings.
“We want to be the leading beverage company around in terms of our approach to sustainability,” says CCE Chairman and Chief Executive Officer John Brock. “We think it’s important for the planet, for the environment, and it’s right for our business.”
The company began gathering data and measuring its impact on the environment several years ago, including a carbon footprint analysis in 2007, which will serve as the baseline for its energy-reduction plans. This year, it published an extensive Corporate Responsibility and Sustainability (CRS) report that detailed its accomplishments to date and its plans for reaching its 2020 goals. Some of the goals are so lofty that the company admits it doesn’t yet know how it will reach them, but the intention is to search out as many areas of improvement as possible.
“We’ve approached it in terms of learning up front, then beginning to establish targets that we thought were achievable, but were not quite as specific as they could have been,” Brock says. “Now, as we have pulled into Commitment 2020, we’re really laying out very explicit plans and programs which we plan to achieve by 2020, even though we can’t sit here today and say precisely how we’re going to accomplish all of them.”
For example, he explains, “For us to pull back our carbon footprint by 15 percent between now and 2020, in spite of the fact that we hope to be selling measurably more product by that time â€” you could even argue twice as much, yet we’re going to pull our carbon footprint back by 15 percent â€” means we really are going to have to engage in some very serious programs and projects to achieve that. We think it’s important to lay out targets, which we’ve now done for 2020, which are very aggressive. But we think we can get there.”
John Downs, senior vice president of public affairs and communications, has spearheaded much of the CRS effort, and says open communication of the company’s goals and its efforts to reach them is critical.
“We live in a world of transparency, and obviously we all understand the great responsibility that we have as stewards of the most iconic brand on the planet,” he says. “What people have told us time and time again, is that they want to understand the how and the what behind our business … so the level of detail that you have seen in our most recent CRS report is our best effort and our best attempt to date to provide that kind of real information in a very specific way about our business operations.”
The company already has invested in its key areas of energy efficiency, water reduction and packaging. Last year, it spent $23 million to reduce energy use, including new lighting systems in its production facilities, more efficient vending equipment and new hybrid distribution vehicles. It spent $8 million in packaging efforts and an additional $3.8 million in water-saving capital projects.
A smaller footprint
Ron Lewis, CCE’s vice president of supply chain for North America, says the company’s carbon reduction intentions fall into three key areas, or scopes, as defined by the World Resources Institute and World Business Council for Sustainable Development’s Greenhouse Gas Protocol. Scope 1 includes the direct emissions from the bottler’s operations, Scope 2 includes the energy it purchases for business use, and Scope 3 from other sources as a consequence of its business.
CCE’s biggest projects to date have been in Scope 1, or those directly related to its operations. One of its most significant investments has been the development of a hybrid truck fleet in conjunction with Eaton Corp. It began with lower gross vehicle weight hybrid electric diesel trucks that were used for moving vending equipment and carrying small amounts of product to service the machines. This year, it added large delivery vehicles as well.
“At the end of last year, we commercialized a full transport truck, one that we can use for 55,000 gross combination weight,” Lewis says. “That’s our preliminary delivery type vehicle. We’re buying 194 of those this year. It takes our total hybrid fleet up to 336 large-duty hybrid vehicles by the end of this year in North America, and we’re proud of that. We’re also piloting two hybrids in Europe. We believe it is, if not the largest, one of the largest hybrid fleets.”
Because hybrid trucks get their best fuel-efficiency results below 50 miles per hour, and because the stop-and-go traffic helps charge their batteries, the hybrid trucks have been deployed in CCE’s major urban markets such as Chicago, New York, Atlanta, Boston and Washington, D.C., where stop-and-go traffic is more the norm.
The company is taking vehicle efficiency a step further this year, working with Smith Electric on a fully electric truck for metropolitan applications. The company initially plans to test two vehicles in markets such as New York City and Washington, D.C, and will use the trucks for servicing vending machines and other applications that do not require a heavy payload.
“It’s definitely a step out there for us to try a fully electric vehicle,” Lewis says. “It’s going to have about 150 miles of range on it, maximum 50 miles an hour. It’s perfect for New York City, where a smaller vehicle is critical for us.”
Inside the plant â€” all 60 of them in North America â€” CCE has added new high-efficiency lighting systems and motion sensors that turn lights on only when people are present. In its new sales center in Coachella, Calif., it added lumen sensors that turn off the lights when enough natural light is available, as well as skylights and light tubes that concentrate and reflect existing light in the plant to amplify the light without additional energy.
Even more mundane tasks like sealing CO2 or compressed air pipe leaks in a plant can result in big savings, the company has discovered.
“Wherever there’s a leak, we want to close up that leak and it saves on the motors that have to generate that compressed air,” Lewis says. “So there are a number of things we are working on inside our plants.”
Scope 3 efforts, or those outside the company’s direct operations and transportation, include working with its vending suppliers on more energy-efficient cold drink equipment. Vending machines feature triple-pane glass and LED lighting, and CCE has eliminated hydrofluorocarbons (HFCs) in the foam. The machines use an intelligent energy management system that can learn traffic patterns and predictively shut down lights, which allows the temperature to rise slightly inside the machine when fewer customers are around.
The company also is working to rid its vending machines of HFC altogether, including the refrigerant, a project it already has implemented in other parts of the world.
“We’re going to be rolling out CO2 as the refrigerant,” Lewis says. “As part of the Vancouver Olympics, we’ll have 1,400 of these CO2 coolers ready to go. We’re also testing HCs, or hydrocarbons, instead of HFCs. So we’re working a lot with our compressor manufacturers and providers of our cold drink equipment on the CO2 and the HCs.”
As a company that sells water-based products, water use and conservation is a critical focus, CCE says. Its goal to be “water neutral” by 2020 involves reducing the amount of water it uses for anything that does not go into a bottle â€” i.e. cleaning, rinsing, cooling, etc. â€” down to the bare minimum.
“It’s a cause that is critical to us as a system and a company,” Lewis says. “Our goal is water neutrality. In our view, water neutrality means for every liter of product produced, that’s what we will use.”
In a production plant, it is impossible to completely eliminate the use of water for sanitization and other needs, but CCE believes it can lower that ratio to 1.3 liters of water for every liter of product it ships out of a plant. For the remaining 0.3 liters that it cannot eliminate, the company will work with local communities on replenishment activities such as rain water harvesting and community rain gardens (see sidebar).
Some of the water-saving efforts the company has implemented so far include dry silicone-based lubrication on conveyors where it previously used water, and air rinsing with deionized air rather than rinsing bottles and cans with water.
In addition, many of CCE’s plants use a reverse-osmosis membrane system to purify water. By adding a reclaim loop to the systems, the company is able to recycle that water for reuse.
“We’re going to put another 10 of these systems in place this year,” Lewis says. “We had about 10 last year, and we’ll eventually get to all of the plants where it makes sense to put these.”
He estimates each system with a reclaim loop saves about 180 million liters of water a year.
Reduce and recycle
CCE, in concert with The Coca-Cola Co., has worked to lightweight its packaging during the past several years, and it is about to up the ante with renewable plant-based materials as well. The company will be among the first to roll out Coca-Cola’s PlantBottle, a PET bottle made, in part, from sugar cane byproduct. It also added low-profile bottle closures and reduced the opening on some of its hot-fill bottles from 43 mm. to 38 mm., all resulting in material savings.
“Last year, we took about 30,000 tons or so of packaging out of our system,” Lewis says.
Inside the plant, the company also has reduced packaging materials. For example, it converted from corrugated trays to corrugated pads on cases of product, and eventually hopes to develop a system that eliminates the need for those as well.
All CCE plants have implemented recycling programs for waste, and the company envisions a day in the not-too-distant future, when no waste from its facilities goes to a landfill. One of its plants is nearly there. In Bellevue, Wash., its bottling facility recycles 99.85 percent of all waste generated at the facility. The success of the Washington plant led the company to set a “Target 100” goal in which 100 percent of all waste in its plants is recycled. It is challenging all of its plants to get to 90 percent by the end of this year, and will keep raising the bar from there, Lewis says.
To make the recycling effort more efficient, a number of CCE’s plants are set up as centralized recycling centers that collect materials such as aluminum, PET, shrinkwrap and cardboard from other production facilities and distribution centers in the same territory. Distribution trucks backhaul recycling materials to the plant, where they are consolidated, sorted and sold to recyclers.
The company also formed Coca-Cola Recycling to promote recycling efforts among consumers. CCR has partnered with Recycle Bank on incentive programs for municipal recycling, was the official recycler at both the Republican and Democratic National Conventions in 2008, and sets up recycling at events like NASCAR races and other big-name venues.
“It’s an effort to try to increase the recycling rates in North America,” Lewis says. “That’s where we think we can get to this collecting 100 percent of the packaging that’s put out in the marketplace. Because, frankly, the few cans and bottles that are scrapped in our plants, that’s a drop in the bucket. The biggest piece for us is collecting the equivalent to what we put out in the marketplace.”
Package lightweighting has a ripple effect throughout production, affecting conveying, palletizing and shipping. Lewis says the effort to reduce packaging materials has caused the company to fine-tune many of its other operations as well.
“By lightweighting our packaging, we absolutely have to have better control of our processes and systems, and it requires more of our manufacturing capability,” he says. “We can no longer just overpressurize a plastic water bottle, for example. You need to have good control around exactly how much nitrogen dosing you’re going to put in that water bottle.”
Less material, lower costs
Most of CCE’s sustainability goals so far have resulted in costs savings as well as environmental benefits. The company already has saved about $6 million a year from the new lighting, for example.
“In terms of efficiencies and effectiveness and eliminating waste … all of those areas yield a very nice financial cost avoidance for us,” Downs says.
Brock adds that nearly every purchase or capital project CCE undertakes these days is evaluated against the company’s CRS goals.
“We don’t buy anything, consider anything, add any manufacturing capacity, fleet capacity or anything else without seriously weighing, evaluating, debating and discussing the environmental impact,” he says.
But he admits a time will come when sustainability projects offer fewer financial incentives, and says the company is prepared to take on those initiatives as well.
“The ones that we’ve tackled first are the ones that are the easiest and have the highest economic payback,” he says. “We fully intend to continue, and I think some of them will come along that have significant economic benefits, but there are going to be others that we’re going to want to do just because it’s the right thing to do, and we plan to do that.”
Carbon footprinting and other third-party evaluations are lengthy processes, so CCE plans to measure its progress in its key areas every three years. But it plans to report its efforts on a yearly basis.
“If we make good progress one particular year in recycling, we’ll say that, and if we don’t, we’ll say that too because we think it’s important for all our stakeholders to have a very clear view of what we’re doing and hold us accountable for what we’ve said we’re going to do,” Brock says.
CCE, like many companies, has realized that its sustainability efforts offer far more than environmental benefits, and also have resulted in better, more efficient operations and employee dedication. Brock says it has become a way of life at the company.
“We think sustainability permeates and absolutely goes across everything we do,” he says. “It’s not just a fashionable, nice-to-talk-about kind of thing; it’s not just here today and gone tomorrow. It is absolutely part and parcel of everything we do, and we think that’s the right thing and the right way to be tackling it.” BI