Bioeconomy Forum Finland 2012 April 2012 Dr. Klaus Stadler The Coca-Cola Company, Europe Group 1
PET packaging has fueled our growth for over 40 Years 1979 1992 2009 lightweight : shatter resistant : re-sealable : formable : inexpensive : recyclable 2
Our Strategic Framework RESOURCE SCARCITY ECO IMPACTS CONSUMER VALUES CUSTOMER DEMANDS To stay competitive we must do more with less impact 3
Traditional Way of Making Polymers using Fossil Fuel Once upon a time. some million years ago (in this context of time: NON RENEWABLE resource = fossil fuel) Today anaerobic decomposition of organic material 4
The Idea: from Non-Renewable to Renewable Carbon Dioxide in atmosphere Fossil Fuel Today: cane sugar Tomorrow: Non-food biomass 5
toward sustainable growth RENEW v1 REUSE RECYCLE REDUCE REFRESH 6
First, some Definitions What are Bioplastics? Plastics made from renewable resources. Where do Bioplastics come from? From renewable resources chemically converted into polymers. Why Bioplastics? To decouple from the use of fossil resources. Renewables versus bio-degradable? 7
Renewable NO YES Where does the Carbon come from? petro based plant based Renewable versus Bio-degradable bpp PLA PlantBottle *) PET ecoflex NO YES Bio-degradable (compostable) (end of life question: micro-organisms can eat it) *) plantpet currently has 30% of the polymer made from plants (via MEG from bio-ethanol) and 70% are petro based (terephthalic acid). 8
Why Not Biodegradable? Recycling vs. Composting Composting biodegradable plastic bottles is a less preferred resource management approach versus recycling Environmentally - and economically - it is better to capture the raw material and the embodied energy in a plastic bottle and use it again instead of wasting it into dirt Biodegradable bottles do not offer a clear environmental advantage over PET plastic even if landfilled 9
A (r)evolutionary innovation Recycled PET Ingredient 1 [PTA] 70% by Weight Plant- Material (sugars) Petro- Material (oil, natural gas) PET Plastic Bottle Consumer Ingredient 2 [MEG] 30% by Weight Bio-MEG (30%) * Patent pending on claim Plant-based PET material with 1% to 100 % plant based content from bio MEG and/or bio PTA 11
Bottle + Plant + Recycling The only plastic bottle made with plants that is 100% recyclable and able to meet the high quality standards of The Coca-Cola Company High Quality Renewable Recyclable + + = Same Performance Less CO2 Less Oil/Natural Gas Less Waste 12
Scaling Across the World 2009 2010 2011 2020 Introduced innovative PlantBottle package Over 2.5 Billion bottles 10 Countries Over 10 Billion bottles 20 Countries All bottles made with PlantBottle plastic 13
2 Years, 20 Markets, +10 Billion Bottles Norway Sweden Canada Great Britain Benelux Denmark Germany United States France Spain Switzerland Japan China (Shanghai Expo 2010) Mexico Brazil Chile Argentina South Africa Australia 2020 Goal: To have all plastic PET bottles include responsibly sourced plantbased materials that are fully recyclable 14
Some early market learnings + PlantBottle idea is well liked and resonates globally + PlantBottle can improve opinion of a brand + PlantBottle can improve trust and overall perception of the Company + PlantBottle has the potential to drive meaningful increased consumption (if in step with consumer awareness) + PlantBottle is relevant to strategic customers - Awareness of PlantBottle in most markets is still very low [Supporting Marketing K&I Research Data Available] 15
Strong External Recognition External Awards: Coca-Cola: Impressively Green UVM: 1,429,880 Bioplastics Boom Circ: 2,092,523 Plastic from Plants: Is It an Environmental Boon or Bane? Circ: 702,840 Coca-Cola's Green Bottle, One Year On Circ: 734,336 Lessons Learned from Creating Coke s PlantBottle UVM: 246,595 Coca-Cola s PlantBottle: Digging Up the Roots UVM: 174,076 The Coca-Cola Company UVM: 25,420,966 Top Opportunities in Green UVM: 6,570,563 Unique Visitors per Month (UVM) "Green" Is More Than a Buzzword at Opportunity Green UVM: 12,622,200 16
Strategic Collaboration: Heinz PlantBottle Packaging Partnership PEOPLE PROFIT PRODUCTIVITY PARTNERS LEADERSHIP (14MM retail shelf impressions per month) PORTFOLIO PLANET (680MM kitchen table impressions per month) 17
Marketing Leadership: No. 1 Brand Overall, PlantBottle has not just radically changed the way plastic can be produced, but it is beginning to radically change the way businesses view their sustainability initiatives.
PlantBottle Germany Introduced in 2011 67 Million bottles in 2011 14 17% from renewable resources 35 % recycled PET ~ 50% not from fossil resources! 20
Just Getting Started: Investing in technologies to commercialize 100% Bio-PTA (70%) Recycled PET Ingredient 1 [PTA] 70% by Weight Plant- Material (sugars) Petro- Material (oil, natural gas) PET Plastic Bottle Consumer Ingredient 2 [MEG] 30% by Weight Bio-MEG (30%) * Patent pending on claim Plant-based PET material with 1% to 100 % plant based content from bio MEG and/or bio PTA 21 21
PlantBottle Packaging R&D Journey 30% Bio-MEG Commercial Solution Now Building Supply Chain Bio-Mass Feedstocks Commercial Solution 2015 2016 + Leveraging Bio-Fuel Industry R&D 70% Bio-TA Commercial Solution 2015-2016+ Multi-year R&D Program 22
performance transparency Responsible Sourcing Life Cycle Performance End of Life: Recycling zzz 23
A (r)evolutionary step yet ahead RENEW v3 RENEW v2 RENEW v1 REUSE RECYCLE REDUCE REFRESH Thank You! 24
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Not all feedstocks created equal Source Cana-deaçúcar (Brasil) Milho (EUA) Trigo (UE) Beterraba (UE) Country Brazil USA EU EU GHG emissions reduction 90% 35% 34% 45% Energy balance 9.3 1.4 2.0 2.0 Productivity (liters/hectare) 7,000 3,800 2,500 5,500 *Note: reduction of avoided emissions with ethanol as a gasoline substitute and calculated according to life-cycle analysis. Source: World Watch Institute (2006) and Macedo et al. (2008) energy balance. Productivity: IEA International Energy Agency (2005), MTEC and UNICA. GEE: IEA International Energy Agency (2004) and Macedo, I. de C. et al. (2004 and 2008). Elaboration: UNICA SOURCE: UNICA 26
Avantium PEF The Next PET? 100% Plant-based, Small Barrier Bottles EG (Ethylene Glycol) + TA (Terephthalic Acid) PET EG (Ethylene Glycol) + FA (Furanic Acid) PEF PEF - A New Bio-Based Research Phase Polyester similar to PET But With Improved Physical Properties: 2X CO 2 barrier = Longer Life / Lighter Weight Sparkling Small PET 5X O 2 barrier = Longer Life/Lightweight Vitamin water, juice, etc. PET 11ºC higher Tg Thermal Performance - Reduced hot fill weight & costs 50% higher modulus = Stronger Material = Significant Light-weighting Opportunity 100% PlantBottle Bio-Based Challenges Eliminate yellow color, obtain FDA approval, establish separate recycle stream 27
Bioplastics A Fast Growing Market Source: European Bioplastics Assocition 28