Brewing beer is resource intensive. From the electricity required to power modern brewing techniques, to the water footprint of cultivating barley and hops, and the emissions generated during distribution, the beer industry’s environmental impact is significant. This is gradually becoming more of a concern for brewers as deepening drought and other natural resource issues increase demand for environmentally friendly products. Eco is the New Reality – one of Mintel’s Global Food & Drink Trends 2016 – suggests that sustainability is evolving from an internal corporate practice to a driver of product development as the common good becomes a priority for consumers. This is reflected in growing interest in ‘green lifestyles’ and a shift in purchasing habits to sustainable products. One third of US consumers say they are making changes to their lifestyle to benefit the environment For example, a third of US consumers say they are making changes to their lifestyle to benefit the environment and only one in 10 say it is too much of a hassle to be green, according to Mintel’s Natural and Organic Personal Care US 2015 report. A similar picture emerges in Europe, where a quarter of French, Italian and German consumers and one in five Spanish and Polish consumers claimed to be paying more attention in Q1 2016 to the environmental impact of the products they buy. Of course, it is one thing to claim you are environmentally friendly, and quite another to act on it — meaning consumers tend to overstate their “goodness”. Nevertheless, as environmental issues become more real to consumers and become more ubiquitous in the news cycle, behaviours will change. Consumers also expect businesses to be sustainable on their behalf. Some brewers have already recognised this need and attempted to integrate sustainability more closely into their business. The trend has been particularly visible in the craft beer segment, where many pioneering breweries have touted since the 1980s and ‘90s the same community and environmental concerns that are now increasingly valued. These efforts will become a priority in the wider industry as the global population grows and demand for beer rises, with water security likely to be a particular focus given its importance to the industry’s long-term viability. Beer industry evolves, but younger consumers are less forgiving The beer industry’s attempts to improve its green credentials have been supported by the environmental coalition Ceres, which has established a Brewery Climate Declaration in the US. Ceres claims that committed producers are cutting their total energy consumption, increasing their use of renewable energy, and reducing transport emissions to lower their environment impact. Examples include Sierra Nevada, which generates more than 50% of its energy needs on-site using 10,000 solar panels and four hydrogen fuel cells; the Fremont Brewing Company, which has committed to reducing its carbon footprint through energy conservation and zero-waste generation; and Deschutes Brewery, which only uses electricity that is renewable or offset through renewable energy credits. These efforts will continue to appeal as consumers show increased interest in sustainability. However, ‘being green’ is likely to be of greater importance to certain demographics, with Millennials a key audience. Breweries should consider that younger generations are more likely to buy green products than their elders and less likely to forgive poor environmental records. This is because Millennials take less personal responsibility for the current state of the planet, and have instead shifted responsibility onto companies. This is clear in Mintel’s Marketing to the Green Consumer US 2014 report, which reveals that 18-34s are more likely than the over-45s to avoid companies with a poor environmental record and show more interest in corporate green practices. Water conservation will define future sustainability efforts Breweries may be adapting energy and logistics policies to reduce their environmental impact, but sustainability in the industry is likely to focus on one key area going forward: water conservation. Despite significant improvements over the last 20 years, water consumption and wastewater disposal remain high in the category. Estimates vary, but the average brewing process is believed to require 5 to 6 litres of water for every litre of beer produced. UK consultancy Water Strategies suggests this ratio rises to 300 litres of water for every litre of beer when considering the entire production process, with around 98% used to grow hops and barley. Many manufacturers have invested in improving the water footprint of their bottling plants in recent years, including SABMiller and Anheuser Busch-Inbev, but these ratios suggest that brewers need to do more to lean on ingredient suppliers to reduce their water consumption. The need for such initiatives has intensified as changing weather patterns have worsened drought conditions globally, including more recently in California and Brazil. The United Nations has forecast that the world could face a 40% water shortfall in just 15 years, which is likely to require companies to be more conservative in their water usage. Consumers are already beginning to adapt their water habits, and as global water demand tightens, they will demand that brands follow suit. Jonny Forsyth, Global Drinks Analyst, is responsible for researching and writing all of Mintel’s UK drinks reports. He brings ten years of experience working in the marketing industry, with roles at Starcom Mediavest, AB-Inbev, and Trinity Mirror. He is a regular contributor in global and national media outlets such as BBC, CNBC and Bloomberg. You might also be interested in: No related posts.