Organization: Keurig Dr Pepper

Year: 2019

Resolved:

Resolved: Shareholders request that Keurig Dr Pepper's senior management, with oversight from the Board of Directors, issue a report assessing the feasibility of increasing clean energy usage in order to reduce greenhouse gas emissions and climate change risks associated with the use of fossil-fuel-based energy. The report should be issued within one year of this filing at reasonable cost and omit proprietary information.

Supporting Statement:

Supporting Statement: By assessing the feasibility of targets to increase clean energy usage, such as through energy efficiency improvements and renewable energy procurement, our company could prepare to take concrete, practical steps to reduce our emissions of greenhouse gases (GHGs) and align our business operations with global efforts to limit climate change. This could help insulate our company from regulatory uncertainty and position Keurig Dr Pepper as contributing to climate solutions, producing reputational benefits.

In order to mitigate the worst impacts of climate change, the Intergovernmental Panel on Climate Change estimates that a 45% reduction in anthropogenic GHG emissions globally is needed (from 2010 levels) by 2030 to stabilize global temperatures.

Many companies are finding that clean energy is a practical tool to reduce GHG emissions that also benefits their bottom line. Nationally, the US Energy Information Association reports the average cost of electricity is $0.1068/kWh for commercial customers in 2017. By contrast, Bloomberg New Energy Finance's 2018 Sustainable Energy in America Factbook reports "the most competitive power purchase agreements (PPAs) came in at just over [$0.02/kWh] for solar, while wind PPAs... averaged an estimated [$0.017/kWh] in 2018." Likewise, a 2018 Lawrence Berkeley National Laboratory study found the cost of saved energy for commercial and industrial customers in states with utility-funded efficiency programs was just [$0.028/kWh].

The newly combined Keurig Dr Pepper has yet to publish a sustainability report; it refers instead to the reports of the pre-merger entities. Dr Pepper Snapple Group, while highlighting some positive steps, lacks any reference to GHG or renewable energy goals. Keurig Green Mountain has successfully met their public GHG reduction goal. We hope the combined company will set ambitious goals based on this model and that those goals extend beyond 2020. Without such goals Keurig De Pepper lags behind its peers in the beverage industry including Pepsi and AB InBev, which have recently adopted GHG targets. Many peer companies, including Kellogg, Grupo Bimbo, Mars, Nestle, Coca Cola European Partners, and Starbucks are among the 159 companies that have committed to going 100% renewable.

Accordingly, we urge Keurig Dr Pepper to emulate the best climate risk mitigation practices among its corporate peers by studying the feasibility of adopting clean energy targets.