Gabinete Reyes Redentor - Funding Our Growth Through Environmental Sustainability

8/6/2019 Gabinete Reyes Redentor - Funding Our Growth Through Environmental Sustainability

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A Green, Sustainable and Ethical Business Model

FUNDING OUR

GROWTH THROUGH

ENVIROMENTALSUSTAINABILITY

Pepsi-Cola Products Philippines, Inc.




FUNDING OUR GROWTH THROUGH ENVIROMENTAL SUSTAINABILITY

Concepts

•Clean energy has no additional cost.

•If it is not broken, then get someone tofix it.

•Triple bottom line of People, Planet and Profit




The Pepsi-Cola Vision

To be the leader in the Philippines in the

development of a sustainable supply chain

platform that will address the challengesbrought about by climate change

and resource shortage, and do it

within a profitable framework.





About Pepsi in the Philippines

Most profitable beverage company

11 manufacturing plants nationwide, usingmore than 10 million liters of

fuel oil and 60 million kwhs of power





About Pepsi in the Philippines

Cost of power is the highest in Asia and

beset with power shortage

Faced with challenges on price and

supply of fuel and CO2





Project Power Play

Set up renewable energy facilities within the

premises of the Pepsi bottling plants, which are

capable of producing power, steam, CO2and other saleable by-products AT NO

COST TO PEPSI.



http://slidepdf.com/reader/full/gabinete-reyes-redentor-funding-our-growth-through-environmental-sustainability 7/22A Green, Sustainable and Ethical Business Model

Business Model

No capital investment (BOT or BOS)

Use of Energy Service Companies (ESCO) or

project developers, which bear theconstruction, installation, operation and

maintenance costs

Outsourcing of risks (financing, FX,raw material sourcing)




Business Model

Pay based on outputs at reduced prices with

minimum off take

Sharing on external revenues (e.g. sale of power to the grid, carbon credits, CO2

sale)

Assess impact of feed in tariff onpower pricing




Business Model

Transfer of ownership to Pepsi after a

certain period with an option to do O&M

after the BOT period


Exit plan (pre-termination due to non-

performance, buy-out)



Rationale

Not our core business or competence and

thus, direct investment can be risky

Difficult to get Board approval for new oruntried technology and not a priority if it

does not involve a new product line or

process




Rationale

Discounted cost with additional revenues

Opportunity to upgrade assets without

CAPEX


Competitive advantage through

innovation



Rationale

Improved public image through corporate

environmental leadership

Leads to the creation of new

industries (e.g. niche on renewable

energy – captive market, environmental

entrepreneurship




Lessons Learned So Far

Long and winding road

Choice of project developer

Choice of technologyGovernment

Show me the money – obtaining

funding for the projects, loan or equity




Lessons Learned So Far

The biomass supply chain

Vertical integration

ReforestationSupport to coconut farmers

Spread the gospel of clean energy –

Empower customers and suppliers touse clean energy in their operations




What We Have Done So Far

Metro Manila Plant

Project Developer – Restored Energy

Development Corp., new entrant, formerly alaundry company and into the

hotel business

Steam generation facility serving thelargest plant of Pepsi in the Philippines,

uses rice hull





Metro Manila Plant

Uses two multi-fuel Thermax boilers capable

of displacing four million liters of fuel oil25% cost reduction

Operational since April 2010, final

phase completed in November 2010Funded by a local bank with a

guarantee from IFC





North Luzon Plant

Under construction and to be commissioned

in September 2011Solutions Using Renewable Energy,

Inc. – project developer

Cogeneration facility to producepower and steam and will use rice hull

and wood chips





Cagayan de Oro Plant

Under construction and to be commissioned

early 2012Power Source – project developer

Cogeneration facility to produce

power and steam and will use coconutwastes





Other Plants

For contract review and signing

Can be tri-generation and poly-generation

To use solar, wind and biomass

gasification technologies





Our Other Projects

Project Damascus (Big Change)

Implementation of energy efficiency solutions

meant to reduce the manufacturing

plant’s electrical energy consumption by

at least 15%





Our Other Projects

Project Heaven Sent

Water conservation through the recycling of treated waste water, and the harvesting

of rain water




A Green Sustainable and Ethical Business Model

THANK YOU

Gabinete Reyes Redentor - Funding Our Growth Through Environmental Sustainability

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