ENGIE and PepsiCo have announced a 10-year Biomethane Purchase Agreement (BPA). The deal for the UK food and drink industry will underpin a new £70 million ($95 million) anaerobic digestion (AD) plant in North England, marking a significant milestone in industrial decarbonization.
The project:
Starting in 2027, the facility will supply 60 GWh of biomethane annually to PepsiCo UK’s operations. This volume, equivalent to the gas consumption of 5,000 households, will be delivered via a mass-balance approach, allowing green gas to be injected into the national grid while PepsiCo claims the environmental benefits. The initiative is projected to reduce PepsiCo’s carbon footprint by more than 10,900 tons per year, a critical lever for its PepsiCo Positive (Pep+) sustainability strategy.
Circular economy:
The new plant will utilize locally sourced, sustainable feedstock—primarily agricultural waste and rotational crops. Beyond producing energy, the process creates digestate, a nutrient-rich organic soil enhancer. ENGIE will provide the natural byproduct back to local farmers, reducing their reliance on synthetic fertilizers and strengthening the regional circular economy.
“We’re proud advocates of biomethane and are actively investing in projects that drive the energy transition and decarbonize our customers,” said Miya Paolucci, Chief Executive, ENGIE UK. “ENGIE is a global leader in power and gas purchase agreements, and our strength lies in our unique ability to leverage our integrated portfolio to deliver exactly what customers need.”
Market expansion:
The agreement represents PepsiCo’s first BPA across the Europe, Middle East, and Africa (EMEA) region. For ENGIE, it expands its growing UK portfolio, which already includes four operational AD sites in the Southwest that inject 210 GWh of green gas into the grid annually. This project is a key component of ENGIE’s global ambition to reach 10 TWh of annual biomethane production capacity by 2030.
“Reducing greenhouse gas emissions remains a key priority within our UK operations,” said Sian Hamson, Sustainability Senior Manager, PepsiCo UK. “As a low-carbon, domestically produced energy source, biomethane will be a key lever in our broader decarbonization strategy, and we’re proud to be partnering with ENGIE.”
Government support:
The deal has been welcomed by the UK government as a blueprint for homegrown energy security. The £70 million investment is expected to stimulate economic growth in the North of England while advancing national net-zero targets.
“This £70 million investment in clean energy will drive growth across the North of England,” noted Lord Alan Whitehead, Minister for Energy Security and Net-Zero. “Biomethane production and partnerships between companies such as ENGIE and PepsiCo show that industry is backing this government’s mission for clean, homegrown energy.”
