O-I Issues 2020 Green Bond allocation update

Green Bond net proceeds allocated for sustainable projectsì

In November 2019, O-I European Group B.V., a subsidiary of O-I Glass, Inc. was the first packaging company to issue a Green Bond (500 million EUR). The company has committed to allocate an amount equal to the net proceeds from the Green Bond offering to finance and/or refinance new and/or existing Eligible Green Projects within 36 months from the issue date of the Green Bond. As of November 2020, the Company has allocated 255.6 million EUR to Eligible Green Projects.

This allocation includes new investments in purchasing recycled glass (cullet) to further improve the environmental footprint of O-I’s products and production. The purchase of cullet qualifies as an Eligible Green Project as it supports the circular economy through building demand for post-consumer recycled glass and increasing recycled content in new glass packaging.

“Sustainability is integrated into every aspect of O-I’s culture and operations,” said Andres Lopez, Chief Executive Officer for O-I. “Our vision is to be the most innovative, sustainable, and chosen supplier of brand-building packaging, building value for all stakeholders. This Green Bond represents our ongoing commitment to find and execute innovative strategies to elevate our sustainability ambitions.”

To advance these aspirations and ensure sustainability initiatives are driven deep into the company, O-I also recently appointed its first Chief Sustainability Officer, Randolph Burns, who reports directly to the CEO. The Company is actively working to improve the U.S. glass recycling system, building on the successful model in Europe where glass recycling outpaces all other packaging materials.

“We also have initiated a glass advocacy campaign initially focused in the U.S.,” Lopez continued. “This effort will ensure to rebalance the public discussion on social and traditional media with regards to the inherent sustainable nature of glass as well as emphasizing the many benefits of our product including the healthy, premium and brand building characteristics of glass.”

O-I sustainability ambitions are also aligned with the United Nations Sustainable Development Goals and include science-based targets to reduce emissions.

The investment in cullet directly supports these targets by cutting carbon emissions, reducing energy and conserving natural resources while diverting valuable glass feedstock from the landfills. For example, for every 10 percent of cullet used in production, energy consumption is reduced by three percent and carbon emissions are cut by about five percent.

The cullet purchased as a result of Green Bond net proceeds corresponds with the conservation of more than 1.4 million metric tons of CO2 — or the equivalent CO2 generated to electrically power all the homes in the state of Vermont for one year.

Other sustainability initiatives the company is currently pursuing include the process of converting seven North American plants to LED lighting and the use of Oxy-Fuel to increase furnace efficiencies.

The shift to LED lighting at the Muskogee, Auburn, Windsor, Waco, Winston-Salem, Lapel and Brampton facilities reduces energy consumption associated with production—further contributing to decarbonization. The expected energy savings in Windsor, alone, is the equivalent to saving three million pounds of carbon per year—or the equivalent of removing 300 cars from the road.

To advance energy reduction, O-I is also investing in the use of oxy-fuel for furnaces, which uses purified oxygen, rather than air, during combustion. This shift reduces energy input while minimizing gas flow and emissions. Most recently, facilities in Villotta, Italy and Jarvakandi, Estonia have incorporated Oxy-Fuel, achieving the lowest CO2 intensities per ton in the O-I network. O-I’s revolutionary MAGMA technology also advances the sustainability of glass manufacturing by, among other things, increasing flexibility with on-off technology, repairability, potential co-location or near-location possibilities and light weighting.

Management’s assertion on the allocation of net proceeds to qualifying Eligible Green Projects as well as the examination report of our independent accountants are available on the O-I website, along with information on O-I’s overall sustainability agenda.

“As the leader in the glass packaging industry, we will continue to innovate and raise our sustainability ambitions,” said Burns. “We are continuously seeking new, and more sustainable, ways to improve our performance in our packaging and our operations, as well as providing our customers with premium packaging that enhances their brand, while helping to achieve their sustainability goals.”