PepsiCo, Givaudan, Smurfit WestRock and Statkraft have signed a 10 year Virtual Power Purchase Agreement linked to a wind asset in Spain that is undergoing repowering, expected to deliver an estimated 32,000 metric tonnes of carbon dioxide emissions reductions per year. The agreement, announced on 28 April 2026, was structured under PepsiCo's pep+ REnew program with support from SE Advisory Services and represents the program's second completed cohort and its first European renewable electricity cohort. The deal matters because it demonstrates a working model for how large companies can aggregate demand with their suppliers to access long term renewable energy contracts that would typically be available only to the largest single buyers.

 

The Structure of the Agreement

 

The Virtual Power Purchase Agreement runs for 10 years and is tied to a wind asset in Spain that is being upgraded with more efficient turbines. The repowering approach reuses existing grid infrastructure including substations and interconnection points, which minimises additional environmental impact while accelerating the delivery of new renewable capacity to the grid. Repowering existing wind sites is increasingly recognised as one of the fastest and lowest impact pathways to expand renewable generation in markets where prime wind locations are already developed.

PepsiCo served as the lead buyer in the cohort, aggregating renewable electricity demand alongside two strategic suppliers, Givaudan and Smurfit WestRock. By combining demand across the three companies, the cohort secured favourable commercial terms and gained access to long term renewable energy opportunities that smaller buyers typically cannot access on their own. This structure represents an emerging template for how multinational companies can extend their own clean energy procurement experience to support suppliers that lack the scale or technical capability to negotiate directly with developers.

 

The pep+ REnew Program and Its Strategic Logic

 

The agreement was developed under PepsiCo's pep+ REnew program, which was launched in 2022 to help suppliers, manufacturers and bottlers transition to renewable electricity. The program has grown into a global platform supporting over 250 companies across North America, Latin America, Europe and Asia Pacific. The Spanish cohort marks the program's second completed Virtual Power Purchase Agreement and its first European renewable electricity cohort, expanding its geographic footprint into one of the most strategically important renewable energy markets globally.

The strategic logic behind the program reflects how leading consumer goods companies are now thinking about Scope 3 emissions. Direct emissions from PepsiCo's own operations, classified as Scope 1 and Scope 2, represent only a fraction of the company's total carbon footprint. The majority sits in Scope 3, which covers indirect emissions across the value chain including those from suppliers, packaging producers and ingredient manufacturers. Programs that help suppliers access renewable energy at competitive terms are therefore one of the most effective tools available for reducing the larger portion of total corporate emissions.

 

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Alignment With PepsiCo's Climate Targets

 

The renewable electricity generated through the agreement contributes to PepsiCo's broader climate strategy under the pep+ framework. PepsiCo has updated its 2030 climate goals using a 2022 baseline, targeting a 42 per cent reduction in Scope 3 Energy and Industry emissions and a 30 per cent reduction in Scope 3 Forest, Land and Agriculture emissions. These ambitions form part of a broader Science Based Targets initiative validated pathway to achieve net zero emissions by 2050 or sooner.

Archana Jagannathan, Chief Sustainability Officer for PepsiCo Europe, Middle East and Africa, framed the agreement as a step in the company's effort to reduce emissions across its entire value chain rather than only within its own operations. The framing is consistent with how leading global consumer goods companies are increasingly positioning their climate strategy. By treating value chain decarbonisation as a shared responsibility across multiple companies, PepsiCo is acknowledging that no single corporate actor can address its full carbon footprint independently.

 

The Strategic Significance for Givaudan and Smurfit WestRock

 

For Givaudan, the agreement aligns with its 2030 strategy and demonstrates how working with customers and partners can accelerate change throughout the value chain. Willem Mutsaerts, Head of Global Procurement and Sustainability at Givaudan, framed the agreement as a tangible expression of shared climate ambitions. As a major flavour and fragrance supplier to consumer goods companies globally, Givaudan's participation in the cohort positions it to extend the model to other customer relationships and to integrate renewable energy procurement more deeply into its own corporate strategy.

For Smurfit WestRock, the agreement adds renewable electricity to its decarbonisation toolkit at a moment when packaging companies are under increasing pressure to demonstrate sustainability progress. Paper based packaging is one of the most visible packaging categories from a sustainability perspective, and the energy intensity of paper production makes Scope 2 emissions a meaningful component of the sector's total footprint. By participating in the PepsiCo led cohort, Smurfit WestRock is aligning its renewable electricity procurement with the expectations of major customers, which strengthens its commercial position as a packaging supplier.

 

The Role of Statkraft and Spanish Renewable Markets

 

Statkraft, an international leader in hydropower and Europe's largest producer of renewable energy, is supplying the renewable electricity under the agreement. Hallvard Grandheim, Executive Vice President of Markets at Statkraft, described the agreement as showing how companies of varied sizes can work together to drive meaningful climate impact. Statkraft has positioned itself as one of the leading providers of corporate Power Purchase Agreements in Europe, supporting the green transition of corporates and industrials through tailored long term renewable energy contracts.

Spain has emerged as one of the most active renewable energy markets in Europe, with strong solar and wind resources, established grid infrastructure and supportive policy frameworks. The country has attracted substantial investment in both new renewable development and the repowering of existing wind sites. For corporate buyers, Spain offers a combination of competitive renewable energy pricing and significant project availability, which makes it a logical market for Virtual Power Purchase Agreements of the scale represented by the PepsiCo cohort.

 

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The Role of SE Advisory Services in Cohort Aggregation

 

SE Advisory Services, Schneider Electric's global consulting practice, structured and delivered the cohort agreement on behalf of PepsiCo. John Powers, Vice President of Strategic Renewables at Schneider Electric, described the partnership as accelerating decarbonisation across global value chains by combining the firm's market expertise with PepsiCo's supplier engagement model. The role of SE Advisory Services is significant because aggregating demand across multiple companies introduces commercial and contractual complexity that requires specialist expertise to manage effectively.

The cohort model is increasingly recognised as one of the more effective ways to accelerate corporate renewable energy procurement at scale. By coordinating multiple buyers under a common framework, the model reduces transaction costs, allows smaller participants to access renewable energy markets that would otherwise be out of reach and creates the demand certainty that developers need to support new project investment. The successful delivery of the second completed cohort under pep+ REnew demonstrates that the model is replicable beyond a single market or industry.

 

What the Agreement Signals for Value Chain Decarbonisation

 

The wider significance of the agreement lies in what it indicates about how leading multinational companies are extending their own renewable energy experience to enable supplier and partner decarbonisation. Direct corporate Power Purchase Agreements have been a defining feature of corporate climate strategy for the past decade, but they have largely been limited to the largest single buyers. By developing aggregation models that allow smaller suppliers to participate alongside major corporate buyers, the next phase of corporate renewable procurement is opening access to a much broader set of companies.

For the broader value chain decarbonisation conversation, the cohort approach addresses one of the most persistent challenges facing Scope 3 reduction efforts. The performance of the Spanish wind agreement over its 10 year term, measured by emissions reductions delivered, supplier engagement scaled and replicability across other PepsiCo and partner relationships, will provide a useful benchmark for how widely the cohort model can be applied across other industries and geographies.

 

Source: PepsiCo