PEPSICO : EUROPE SETS AMBITION TO ELIMINATE VIRGIN FOSSIL-BASED PLASTIC IN ALL OF ITS CRISP AND CHIP BAGS BY THE END OF THE DECADE

PEPSICO EUROPE SETS AMBITION TO ELIMINATE VIRGIN FOSSIL-BASED PLASTIC IN ALL OF ITS CRISP AND CHIP BAGS BY THE END OF THE DECADE

01/25/2022

• Sets new ambition to use 100% recycled or renewable plastic in all packets by 2030, reducing greenhouse gases from film packaging by up to 40%
• Consumer trials will be rolled out in markets from this year
• PepsiCo will work to build a circular economy for flexible packaging in Europe through design, infrastructure and giving packaging materials a new life, as part of its wider pep+ (PepsiCo Positive) ambition.

[25 January 2022] Following the introduction of PepsiCo Positive, the company's strategic end-to-end transformation with sustainability at the centre, PepsiCo Europe today announces that by 2030, it plans to eliminate virgin fossil-based plastic in all its crisp and chip bags. This ambition will apply to brands including Walkers, Doritos, and Lay's and will be delivered by using 100% recycled or renewable plastic in its packets.

Consumer trials of the packaging will begin in European markets in 2022, starting with renewable plastic in a Lay's range in France in the first half of the year. Later in the year, a range from the Walkers brand in the UK will trial recycled content. The recycled content in the packs will be derived from previously used plastic and the renewable content will come from by-products of plants such as used cooking oil or waste from paper pulp. PepsiCo estimates it may achieve up to 40% greenhouse gas emissions reduction[1] per ton of packaging material by switching to virgin fossil-free material.

Silviu Popovici, Chief Executive Officer, PepsiCo Europe commented: "Flexible packaging recycling should be the norm across Europe. We see a future where our bags will be free of virgin fossil-based plastic. They will be part of a thriving circular economy where flexible packaging is valued and can be recycled as a new packet. We're investing with our partners to build technological capacity to do that. We now need an appropriate regulatory landscape in place so that packaging never becomes waste."

PepsiCo uses flexible plastic for its snack packaging - the soft wrapping used to make its crisp and chip bags because it is lightweight compared to alternative packaging and therefore has a low carbon footprint. It is also highly effective at keeping food fresh thereby reducing food waste. However, PepsiCo recognises that change is needed to reduce the amount of virgin fossil-based plastic that is used and to drive circularity in flexible packaging. PepsiCo Europe will focus its work on three strategic pillars: the right design; the right infrastructure and the right new life for flexible packaging.

Beyond the switch to renewable and recycled content, PepsiCo has developed its "Making Bags Better" program, that will focus on a series of investments and innovations so more flexible plastics will be recycled and reused in Europe.

The right design

PepsiCo Europe is moving all its bags to materials that make them easier to recycle, leveraging innovative design technology to create a simpler bag structure. The new bag designs contain greater proportions of recyclable plastics like Polypropylene, commonly referred to as 'mono-materials'. These meet the design for recycling guidelines developed by the Circular Economy for Flexible Packaging (CEFLEX) which have been agreed by a range of stakeholders active in the flexible packaging value chain.

Gerald Rebitzer, Sustainability Director at AMCOR, PepsiCo's flexible packaging partner in Europe, shared: "We are building a future where flexible packaging is part of the circular economy. Together with PepsiCo, we enhanced the material technologies on PepsiCo's new crisp packet to make it easier to recycle. And we are beginning to integrate renewable and recycled content into PepsiCo's packaging. To meet the demands of our clients like PepsiCo, we encourage more partners upstream to invest in the supply chains of these new materials."

PepsiCo has also been working to reduce unnecessary packaging across its individual bags and multipacks as part of its commitment to a 50% reduction in virgin plastic per serving by 2030. Progress is being made towards this goal, including in markets such as the UK where on some parts of the range, PepsiCo has reduced its multipack outer by up to 30% using innovative technology in its manufacturing facilities.

The right infrastructure

PepsiCo is committed to investing in infrastructure to give flexible packaging the chance of a second life and in advocating for policy changes that will make that possible. This includes collaborating on and financing the development of effective waste collection systems in Europe and investing in schemes such as the Flexible Plastics Fund in the UK and REFLEX in Poland. As part of this approach PepsiCo Europe is advocating to set ambitious recycling targets for flexible packaging including accelerating the ban on landfill and to swiftly adopt EPR (Extended Producer Responsibility) fees that drive collection, sorting and actual recycling of flexible film. PepsiCo is also investing in technology to further scale and improve sorting and recycling, trialling smart packaging on several brands in 2022 in Germany and France as part of the Holy Grail 2.0 Digital Watermarks initiative. PepsiCo is working with partners in the recycling industry such as Borealis and TOMRA to progress advanced recycling technologies for flexible packaging.

The right new life

PepsiCo will focus on building demand for recycled content made from flexible packaging to support its use more widely. Alongside the company's planned trials of recycled plastic this year, the company is also continuing to explore new life possibilities for its snack bags. While the goal for PepsiCo is bag-to-bag circularity which is suitable for food packaging, it is clear that collection, advanced sortation, and recycling of flexible films to produce valuable and durable products is an important first step towards a circular future for flexible packaging. For this reason, PepsiCo is also exploring the conversion of packets into plastic pellets to be remade into items such as floor posts and as parts within the automotive industry.

The announcement today is the latest in the company's ambitious plans to build a world where packaging never becomes waste, one of the focus areas of PepsiCo Positive. The company has already announced its plans to transform its beverage packaging. It will transition brand Pepsi into 100% recycled plastic (100% rPET) bottles in eleven European markets by 2022 and also continue investing in building a reusable model, including through SodaStream, which aims to avoid an estimated 200 billion plastic bottles by 2030.

"Through collaboration and innovation, we can progress to a viable circular economy for our food packaging in Europe," shared Archana Jagannathan, Senior Director, Sustainable Packaging, PepsiCo Europe. "Today, the supply of recycled and renewable materials for flexibles is limited. The regulatory environment is very dynamic and we need more clarity on policy and recognised technologies. If a policy and waste infrastructure, similar to beverage bottle packaging accelerates for flexibles, we will speed up our plans and go even faster to meet our commitments."

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About PepsiCo

PepsiCo products are enjoyed by consumers more than one billion times a day in more than 200 countries and territories around the world. PepsiCo generated more than $70 billion in net revenue in 2020, driven by a complementary food and beverage portfolio that includes Frito-Lay, Gatorade, Pepsi-Cola, Quaker Tropicana, and SodaStream. PepsiCo's product portfolio includes a wide range of enjoyable foods and beverages, including 23 brands that generate more than $1 billion each in estimated annual retail sales. Guiding PepsiCo is our vision to Be the Global Leader in Convenient Foods and Beverages by Winning with Purpose. "Winning with Purpose" reflects our ambition to win sustainably in the marketplace and embed purpose into all aspects of our business strategy and brands. For more information, visit www.pepsico.com.

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[1]. Based on a Cradle to Grave Lifecycle Assessment provided by Franklin Associates, A Division of ERG, using cut off methodology, a mix of data provided by suppliers and industry, and an estimated 2030 end of life scenario. This Assessment includes carbon storage credits, waste-to-energy electricity production credits, and avoided legacy waste treatment credits.