Cooler Sustainability with Hydrocarbon Refrigeration

Soykan DirikPepsiCo InternationalMarketing Equipment Manager – Europe Division

United Nations Enviroment ProgrammeJoint Europe and Central Asia (ECA) and South Asia Network meeting

Istanbul, 26 April 2010

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PepsiCo Performance with Purpose

Cold Equipment Sustainability Strategy

Progress to Date

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What comes to mind thinking about PepsiCo … …

10-04-23 PepsiCo Confidential 3

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PepsiCo has 19 Global mega PepsiCo has 19 Global mega brandsbrands

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This makes PepsiCo the second largest This makes PepsiCo the second largest Food and Beverage company world wideFood and Beverage company world wide

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23,525,1

27,029,3

32,635,1

39,4

43,3 43,2

2001 2002 2003 2004 2005 2006 2007 2008 2009

Net Revenues ($B)

PepsiCo PepsiCo InternationalInternational

PepsiCo PepsiCo Americas FoodsAmericas Foods

PepsiCo PepsiCo Americas Americas BeveragesBeverages

47%

25%28%

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PepsiCo’s responsibility is to continually improve all aspects of the world in which we operate – environmental, social, economic – creating a better tomorrow than today.

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Attract, retain and

develop top world-class

talent

TalentTalent

Develop healthy,

convenient products for all consumers

HumanHuman

Be responsible stewards of our planet’s resources

EnvironmentEnvironment

Performance With Purpose Philosophy Is Based On 3 Planks

Environmental Sustainability is a priority for Equipment

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Leakage

Total Environmental Warming Impact

95%

4% 1%

Eliminated Hydrofluorcarbons (HFC) as foaming agent

All factories are compliant- worldwide

HFC Free Foam

Energy Reduction

Compliant for all models with energy standards

Work with strategic suppliers on latest technology

Be the industry’s leader and focus on energy reduction

Alternative Refrigerants Started field trials of HCs

and CO2 in 2006 Continue to evaluate both options globally Build infrastructure in one country and expand to others

Equipment Sustainability StrategyThree strategic initiatives to Reduce green house gas emissions (GHG)

Indirect from Electricity Usage

Direct from HFC refirigerant in

system

Direct from HFC in Blowing Agent

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Why Should We Do This

Alignment with corporate strategy to reduce GHG (Performance with Purpose)

Consumers and customers are asking for it

Equipment contributes considerably to GHG emission

3.0 times more electricity used annually

All Pepsi Coolers & Venders All Pepsi Plants Combined

PepsiCo proactively takes voluntary steps reducing carbon footprint of coolers

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32• Efficient System & components

• HC systems design

• R290

• R600a

• CO2 system design

• Multi year plan

• Global strategy

• Engage stakeholders

Top Level Approach

1• Latest technology

• Analytical tools

• System analysis

Research Planning Development

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Reducing Energy Through Research & Exploring New TechnologyEnergy Reduction

• Pipeline of Innovative ideas and technologies

• Energy roadmap – System optimization

• Super efficient cooler

Percentage of Energy Reduction

Air Curtain - 10 hrs LED Lighting

ECM Motor

Energy Device

Low E-Glass

VCC Compressor Expansion Valve

Evap. fan Cycling with Compressor Cooler/

vender Mister

25% 30% 20%

20% 12% 10%

5% 2%10%

Energy RoadmapMathematical Model

• Optimizing tools using mathematical modeling• System level approach – smart design• Compressor consumes over 50% of energy• Opportunity for better heat exchange design

Benefits

Measured energy = 5.30 kwh/d

Calculated energy= 5.17 Kwh/d

1.44, 28%

0.55, 11%

0.27, 5%

2.92, 56%

CompressorLightingEvaporator FanCondenser Fan

Kwh/d

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HC Global Initiative- 2009 and beyond

Leverage learning from Turkey, Expand to Europe Expand China - beyond field test

Plan: place 50,000 coolers by 2013 Approve HC models for NA

Field test unit in US – Jan. 2010 Expand HC to new markets – LAR, India…. Winter Olympic in Canada – CO2 vendors

Build infrastructure in Turkey Turkey has best model for service

Build capability for local suppliers Incorporate latest technology in design Four HCs models approved

Turkey- HCsTurkey- HCs Global- HCsGlobal- HCs

51% lessenergy than

baseline

29% lessenergy than

baseline

Two Systems: Two Systems: • R600 aR600 a• R290R290

48% lessenergy than

baseline

Establish strategic supplier in each region

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Green Coolers Highlights

PEPSI “GREEN” COOLER

Green Cooler

Energy Saving Device

Day/Nignt Mode

• First Cooler with HC gas in Turkey– Briefed the suppliers that Pepsi strategically

supports HC

– Customer concerns on cooler electricity costs supported transition

– Local suppliers developed proper equipments for the market needs

– Had the in-house technical infrastructure to support HC

– PepsiCo Corporate developed Energy saving controller to reduce energy further +20 %

• First Country switching to HC for 100% of New Coolers

– To retailer : “51% less energy consumption and more environmentally friendly”

– To consumer : “This cooler saves 5 trees with it’s energy saving technology”

Cooled byHC Refrigerant

(R600a)&

Equiped with Energy Saving Device

All

New

Co

ole

rs G

reen

as

of

2009

an

d b

eyo

nd

..!

The key factor of the successful implementation of the alternative refrigerants in developing countries such as Turkey is that, the proposition brings commercial

value to the customer while doing the right thing for the environment

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HC vs. CO2 System

• HC operate at lower pressure & take less charge

• HC compressor is smaller and more efficient

• COP for HC is higher than R134a

• Operates at 10 times higher pressure

• Performance issue at high ambient

• Estimate system cost (10-25)% > HFC

Hydrocarbons (HC) SystemsHydrocarbons (HC) Systems COCO22 System- Carbon Dioxide - R744 System- Carbon Dioxide - R744

Isobutane - R600a Widely used in Europe for household

refrigeration Single door cooler

Propane - R290 Mainly used for low temperature

applications Double door cooler & open air

• Experimental Stage

• Large coolers and vending machines

• Use when the charge is > 150g

PEP Pursuing Duel Strategy Based on Application and Market Regulations – HCs & CO2

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Equipment GHG Emission

PepsiCo focused on energy consumption of the coolers which has 95% effect on the environment

Hydrocarbon gases are high in energy efficiency and give about 30% energy saving

PepsiCo promotes Hydrocarbon gases based on their energy efficiency besides GHG

• Unit emission reduced

1.30

1.35

1.40

1.45

1.50

1.55

1.60

CO2e MT/Unit

CO2e MT/Unit

1.59 1.57 1.56 1.50 1.44 1.40

2004 2005 2006 2007 2008 2009

By retiring old equipment and implementing new technologies,

total emissions will also decrease

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Equipment Sustainability Progress to Date………

Alternative RefrigerantsEnergy Reduction• 48% energy reduction in 2009 vs. 2004 baseline

• Introduced 48 new efficient coolers in 2009

• Developed super efficient cooler = 2.2 kwh/d

• 863,942 GHG Metric tons saving vs. 2007

• 44% in 2009 vs. 2004 baseline

• Launched Bev Max IV- 30%

lower energy than E-star

• 13073 GHG Metric tons saving

vs.2007

• 15 HC models approved for bottlers worldwide

• Expanding in Europe & Asia

• Built Turkey as 100% HC

• Design HC model for US market

• Place 35 Units HC in US - FL

• Redesigned & Optimized Beverage Max III CO2 vending machine to meet E-star requirements

• Placed 30 CO2 vending machine in strategic location in DC area

• 30 CO2 units in Winter Olympics- Canada

Coolers

Vending

• Total of 877,015 metric tons reduction since 2007. On Average 292,338 metric tons/year

168,000 cars in total or 56000 cars/year

• Total saving 1.8 B Kwh since 2007

• Increased number of green refrigerant units in the field. Exceeded commitment to Refrigerants Naturally! Group for 2009

• 13, 321 Units in the field globally• 1,372 Units Refrigerants Naturally

Commitment

GreenHouse GasReductionKwh

Turkey 100% “ Green”

In 2009 and beyond

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