When it comes down to large corporations being more conscious of their environmental impact, Walmart’s Project Gigaton is taking a step in the right direction with its latest aggregated Power Purchase Agreement (PPA). Finally completed in October 2022, the PPA gets the retail giant closer to its goal of running on 50% renewable energy by 2025 and 100% by 2035.
Project Gigaton was first created in 2017 with the “aim to reduce or avoid one billion metric tons (a gigaton) of greenhouse gasses from the global value chain by 2030.” The way the project works is that when a supplier joins, they must focus on the six target areas. These six pillars include energy, waste, packaging, nature, transportation, and product use and design.
Not only does Walmart provide statistics for why these are the most crucial targets, but it also gives tips and resources on how suppliers can make environmental progress. For example, the energy pillar states how electricity and fuel are some of the highest costs businesses incur, and fossil fuels are the leading contributors to global emissions. To reduce these numbers, the retailer encourages participants to find ways to cut power use and offers suggestions for renewable energy alternatives with little to no carbon emissions.
Initiatives like the Gigaton PPA are vital to efforts like Project Gigaton. According to the U.S. Department of Energy, PPA agreements allow a third party to set up energy systems on a property where the customer can receive stable and low-cost renewable power.
The first cohort of the Gigaton PPA will execute an aggregated purchase of clean power from Ørsted’s Sunflower Wind Farm in Marion County, KS. Over the 12-year agreement, the buy is expected to generate approximately 250,000 megawatt-hours of new renewable energy annually. The PPA includes popular brands like Amy’s Kitchen, Great Lakes Cheese, Levi Strauss & Co, the J.M. Smucker Company, and Valvoline Inc.
Walmart jointly developed the Gigaton PPA program in 2020 with Schneider Electric, which was awarded the Best Global Sustainable Supply Chain Organization at the Global Sustainable Supply Chain Summit in 2021.
At that ceremony, the company was commended for how, by the end of 2020, 80% of its operations “were powered by renewables, enabled by Schneider’s technologies and leveraging renewable Power Purchase Agreements (PPAs),” proving how the company is one of the best options to join Walmart’s efforts.
By focusing on and helping its suppliers, Walmart will have a greater impact than focusing solely on its operations. “Companies’ supply chain emissions are 11.4 times higher on average than their own emissions,” according to Schneider’s website. “If sustainability targets are going to be seen as credible, supply chain emissions have to be included.”
“We developed Project Gigaton™ to help accelerate our suppliers’ zero-emissions efforts, and the Gigaton PPA program is a key example of how we are making progress by harnessing the collective to make renewable energy more accessible to more companies,” said Jane Ewing, senior vice president of sustainability at Walmart. “We are proud of our collaboration with Ørsted, Schneider Electric, and this initial cohort of valued suppliers.”
So, what’s next for Project Gigaton in 2023? Currently, suppliers who hit certain goals are given a special status, like “Giga-Guru” or “Sparking Change.” Throughout this year, those who want to achieve either label must set goals in three of the pillars and report their progress. To be a “Giga-Guru,” the company must additionally share its carbon footprint to be more transparent.
As of 2022, Walmart reported that more than 4,500 of its suppliers had joined their efforts, making the project one of the largest private sector consortiums for climate action. Hopefully, as more suppliers join the effort, a greater environmental impact, and more PPAs will follow.