#China #Shanghai #Envision Energy #Low-Carbon Ammonia #PepsiCo APAC

Envision Energy's Groundbreaking Deal with PepsiCo APAC

On July 30, 2026, Envision Energy, a global leader in green technologies, unveiled a significant partnership with PepsiCo APAC focused on sustainability and emissions reduction. This agreement involves the acquisition of environmental certificates for low-carbon ammonia, marking a pioneering step in the decarbonization of the fertilizer sector.

The deal includes the supply of an initial 1,000 tons of environmental attribute certificates (EACs), which have been issued and managed through the S3 Markets environmental attribute registry. These certificates are estimated to correspond to a potential reduction of approximately 5,000 tons of CO₂ equivalent emissions.

Addressing Emissions in the Fertilizer Industry

The transaction aims to bolster emerging efforts to cut down the emissions associated with fertilizer production by linking the verified generation of low-carbon ammonia with downstream demand. This connection is particularly important in reducing Scope 3 emissions—indirect emissions from a company's supply chain—before extensive physical supply chains of low-carbon ammonia become available.

From 2026 to 2030, Envision will continue to supply PepsiCo APAC with EACs related to low-carbon ammonia produced at their Chifeng Net Zero Industrial Park, the world's largest green hydrogen project. This partnership illustrates a novel strategy to decrease emissions across PepsiCo’s entire supply chain.

Ammonia plays a crucial role in the fertilizer industry, serving as a primary raw material for various products, including urea, ammonium nitrate, monoammonium phosphate, and diammonium phosphate. Traditionally, the production of ammonia has relied heavily on fossil fuels such as coal and natural gas, which contribute significantly to carbon emissions. Therefore, transitioning ammonia production from high-carbon to low-carbon sources represents a vital lever for decarbonization, benefiting both fertilizer manufacturers and downstream brands.

Innovative Book-Claim Model

A significant aspect of this agreement is the adoption of the Book-Claim model, previously utilized in sectors like sustainable aviation fuels (SAF). This model decouples the physical product from its environmental attributes, allowing the low-carbon ammonia produced in Chifeng to generate traceable EACs that can be assigned to PepsiCo APAC without necessitating long-distance transport of the product itself.

The EACs will be managed within the S3 Markets environmental attribute registry, which supports the issuance, tracking, allocation, and retirement of environmental attributes for low-carbon ammonia. The registry links each certificate with relevant production, emissions, sales, and retirement documentation to create a verifiable product chain enhance the integrity of claims and support credible downstream assertions.

Saman Baghestani, co-founder and CEO of S3 Markets, commented on the significance of credible infrastructure: "Raw material-bound EAC markets will only gain traction if the infrastructure is as credible as the underlying low-carbon production. This transaction exemplifies how verified production, clear ownership of attributes, and verifiable registry entries combine to underpin trustworthy downstream claims."

For PepsiCo APAC, these environmental certificates will aid in accounting for Scope 3 emissions reductions, contingent upon evolving guidelines and reporting requirements within applicable standards, along with internal controls throughout the company’s agricultural supply chain. This innovative approach not only minimizes logistics costs linked to transporting physical low-carbon ammonia across regions but also facilitates a more efficient flow of environmental attributes across the fertilizer, agriculture, food processing, and consumer goods value chains.

Fred Li, Senior Vice President of Supply Chain at PepsiCo APAC Greater China, acknowledged the complexities involved: "Emissions associated with fertilizers often constitute a substantial part of Scope 3 emissions in the food and agricultural value chain. These areas, however, are among the most challenging and fragmented to address. The agreement with Envision aims to tackle emissions linked to upstream agricultural inputs more efficiently, without altering our existing sourcing or production agreements."

Ashley Brown, Chief Sustainability Officer of PepsiCo APAC India, highlighted the agreement's alignment with PepsiCo's broader sustainability goals: "This is another pivotal example of 'PepsiCo Positive' (pep+) in action. It supports our objective of achieving net-zero emissions by 2050 or sooner, providing an innovative path to tackle emissions at vital hotspots within the agricultural supply chain. We look forward to collaborating with partners like Envision to enhance sustainability throughout the entire value chain—from field to shelf."

Frank Yu, Senior Vice President of Envision Energy, remarked on the collaboration: "Our partnership with PepsiCo APAC represents a significant advancement for Envision's business model innovation within green hydrogen and ammonia sectors. The fertilizer industry uses vast quantities of ammonia and holds substantial decarbonization potential. The benefit of the Book-Claim model for green ammonia EACs is that it allows for efficient and flexible matching of environmental attributes with real decarbonization needs without the necessity of long-distance transport. Envision will continue to leverage the value of wind and solar resources to help customers across various sectors achieve cost-effective decarbonization through green electricity, green hydrogen, green ammonia, and EACs."