Sustainability in Soft Drinks & Water - Part IV - Packaging
In the fourth and final part of this month's management briefing, Ben Cooper continues his consideration of the environmental sustainability of the soft drinks and bottled water categories. Here, Ben looks at the role of packaging.
There is arguably no aspect of environmental sustainability with a stronger link to how consumers relate to companies and brands than packaging.
The design of packaging has been a vital element in brand communication since brands were invented. Graphic and other design elements are created and regularly 'tweaked' - generally at vast expense - to help communicate what a brand is about.
By the same token, sustainable packaging innovation can say something about a brand and a company's approach to environmental sustainability.
In both the soft drinks and bottled water sectors, consumers do not just pick up and handle beverage containers, they also frequently drink from them. They are therefore likely to notice innovations such as lightweighting aimed at improving eco-efficiency, while on-pack communication, detailing such things as what materials are being used and why, has every chance of registering with the consumer because of the extended and regular physical handling of the product.
Moreover, improvements in the environmental characteristics of packaging are not merely a highly visible form of eco-innovation: Packaging is a substantial contributor to emissions as the breakdown in total emissions at Danone and the Coca-Cola Co bear out.
Packaging accounts for 37% of carbon emissions in Danone's water division, compared with 14% for the group as a whole. For Coca-Cola, packaging is the second largest emissions contributor after refrigeration, accounting for significantly more than manufacturing and distribution combined.
The most tangible aspect of eco-innovation in packaging is lightweighting. Progress among the major soft drinks and bottled water producers in this area has been ongoing for some time.
Danone reports that, since 1990, the weight of its Evian bottles has been reduced by 29%. The Evian 1.5-litre bottle introduced at the end of 2010 weighed 28.6g, 11% less than its predecessor.
Meanwhile, Dan Bena, senior director of sustainable development at PepsiCo, describes the lightweighting initiatives at his company over the years as "nothing short of amazing". There are initiatives across the PepsiCo business, but lightweighting progress on its Aquafina bottle is "probably one of our sterling examples", Bena says.
In 2001, an Aquafina bottle weighed 24g but the Eco-Fina bottle introduced in 2009 weighed 10.9g. This evolution has resulted in an estimated reduction of nearly 13,600 tonnes of PET since 2008. The Eco-Fina bottle is made with 50% less plastic than the 50cl Aquafina bottles used in 2003.
"One of our public goals is to reduce packaging weight by 350m pounds, avoiding 1bn pounds (453,600 tonnes) to landfill over five years [to 2012], and we're well on-track to succeed that goal," Bena says.
Latterly, eco-innovation in packaging has progressed from lightweighting to the development and use of plant-based materials in PET packaging.
Standard PET is made up of two molecules, 70% terephthalic acid (PTA) and 30% monoethylene glycol (MEG). In new eco-friendly bottles, the MEG constituent is produced not from oil but using plant-based ethanol. However, the chemical composition of the plastic remains the same so the bottle has the appearance of conventional PET and remains 100% recyclable.
The use of plant-based material in PET is becoming increasingly common in the water and soft drinks sectors. Coca-Cola's PlantBottle, a fully recyclable PET bottle made with up to 30% plant-based material introduced in 2009, is one of the most notable and well-known examples.
Coca-Cola has made a commitment that, by 2020, every plastic bottle it uses throughout the world will be made from at least 30% plant-based material. However, Jeff Seabright, VP for water resources and the environment at the Coca-Cola Co, says the company is already "growing it very aggressively".
Currently, the PlantBottle accounts for around 5% of total volumes, with around 10bn bottles being sold annually across 21 markets.
A critical challenge stemming from the use of plant-based material in packaging is ensuring that the source for that material is itself sustainable. When climate-friendly technological solutions involve sourcing more agricultural products, there is always a danger this can lead to unintended negative consequences for food agriculture supply chains and farming communities, the challenges created by the growth in bio fuels and biomass production are notable examples.
Coca-Cola says it worked with academics, governments and NGO partners to find a sustainable source for the plant material for PlantBottle which is sugar cane-based ethanol from Brazil.
With those sustainability challenges in mind, companies working with plant-based plastics are now looking for technological solutions that would allow the use of 'second generation' materials in the production of bioplastics. Coca-Cola sees this as "the next phase" in the development of PlantBottle.
Seabright says the search for such second generation bio-feedstock, which does not "compete with potential arable acres for food production", is the "holy grail" for companies using bioplastic containers.
In the case of sugar cane, the goal would be to make ethanol not from the sugar itself but from the cellulosic material in the sugar plant. This is something that has proven to be possible, says Seabright, "but getting it to scale is the next challenge".
Danone, which has launched plastic containers using plant-based material across four brands, including Volvic, is also looking for this next generation of bio feedstock. Jean-Christophe Bligny, environment director at Danone Waters, says the search for bio materials that do not compete with food or feed supply chains is "really key", and that the company is looking to achieve that goal "very rapidly".
The other principal challenge for the beverage companies and their packaging suppliers is to come up with a 100% plant-based bioplastic solution. Finding a bio-based feedstock to produce the PTA component in PET, which makes up 70% of the content, has been "more of a challenge", Seabright says, but "we're researching that as well".
Some 100% bio-based solutions are in the marketplace. PepsiCo has, for example, developed a 100% resin, zero-percent petroleum bottle that is also fully recyclable through current PET streams, which is being piloted this year. Meanwhile, Coca-Cola is using a 100% high-density polyethylene (HDPE) bottle for its Odwalla brand.
While both Coca-Cola and PepsiCo are working on the development of 100% bio-based packaging solutions that can be taken to scale, this work is at a comparatively early stage in comparison with the partially plant-based PET, which appears to have great potential to be taken to scale over the next five to ten years, not least as the costs will be coming down.
"The trend to increase the availability of such bio-sourced material is favourable and we expect the cost of production to be reduced in the future," says Bruno Pruvost, chair of the environmental working group at the European Federation of Bottled Waters (EFBW).
However, Pruvost believes there is a considerable way to go regarding the use of 100% plant-based plastics in the bottled water market. "Technically this is feasible," he says. "But the packaging industry is still working on developing a sustainable process with affordable cost of production. These studies are still ongoing and we have to be patient."
One fascinating aspect to the progress on bioplastics is Coca-Cola's desire for PlantBottle, a trademarked asset, to function almost as a mini-brand in its own right. Last year, the company signed an agreement with Heinz enabling the food company to use PlantBottle packaging for its ketchup bottles, which crucially also bear the PlantBottle logo.
Seabright says the company recognises the "real value" in the PlantBottle logo being used on other brands, likening this to the ubiquitous 'Intel Inside' logo seen on computers.
The fact that Coca-Cola sees PlantBottle in this way clearly says something about how environmental sustainability is now viewed by major beverage corporations. Smart thinking around sustainability has not only become a business prerequisite but such is the prominence of environmental issues that innovation in this area can be leveraged for positive reputational and commercial benefit.
To head back to the third part of this briefing, click here.
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