Sonoco had contracted about 140 megawatts of electricity per year for 15 years under a virtual power purchase agreement with Engie North America Inc., a Houston-based provider of low-carbon energy and services, the statement said. Engie's stated purpose is to “accelerate the transition towards a carbon-neutral economy,” according to the company's website. Engie North America is a regional hub of French company Engie SA.
The 140 megawatts equates to about 83% of Sonoco's US energy consumption in 2025, the statement said. The renewable energy is produced at Engie's Big Sampson wind project in Crockett County, Texas. Sonoco expects the renewable energy credits acquired under this agreement will help reduce its baseline carbon emissions by about 19%.
A virtual power purchase agreement is “a financial transaction, exchanging a fixed-price cash flow for a variable-priced cash flow and renewable energy certificates,” according to Introduction to the Virtual Power Purchase Agreement, a paper published by Colorado-based energy nonprofit RMI. The buyer of renewable energy certificates may retire the credits, which counts toward sustainability goals.
Renewable energy certificates, also called renewable energy credits, are tradable instruments that “can be used to meet voluntary renewable energy targets, as well as to meet compliance requirements for renewable energy policies,” according to a fact sheet by World Resources Institute, a Washington, DC, nonprofit that researches sustainability practices.
The agreement is part of Sonoco's corporate initiatives to reduce global emissions. Other initiatives include improved packaging design and installation of energy-efficient equipment, according to the statement.
Sonoco Vice President of Global Sustainability Scott Byrne said in the statement, “This project will accelerate our progress toward our emissions targets while delivering clean, reliable power to the communities they serve.”
The Big Sampson project comprises 60 wind turbines, each of which is expected to have a generating capacity of 4.5 megawatts, the statement said.
Shares of Sonoco Products Co. are up 6.527, or 14.71%, year to date and up 2.767, or 5.75%, in the last 12 months at time of writing. Sonoco stock trades on the New York Stock Exchange under ticker symbol SON.