July 25, 2024

Published in BayBuzz Magazine July + August 2024. Article by Brenda Newth.

WineWorks has an impressive sustainability story to tell. But unlike the first company covered in our sustainable companies series – Napier Port – WineWorks doesn’t have a high profile with the general public. In fact, WineWorks might be one of the biggest companies in Hawke’s Bay that no-one has ever heard of.

Before we get to its sustainability programmes, let’s take a step back and talk about WineWorks and how things got started nearly thirty years ago. WineWorks is a contract bottling, warehousing and distribution company that serves New Zealand’s winegrowers. With sites in Auckland, Marlborough and Hastings it employs around 500 people and currently bottles for 400 of the country’s 700 wineries, producing 140,000 cases per day at peak production, with 85% of it exported. That makes WineWorks New Zealand’s leading contract bottler of any beverage or liquid.

Tim Nowell-Usticke founded the company in 1995, on his return to New Zealand after seven years working in Australia’s fast moving consumer goods sector. He was looking for a local opportunity in the food sector, and in particular what low value food could be turned into a high value product.
“I was thinking in terms of a Watties or a McCain, or an organic baby food company, but actually the latest crop to hit Hawke’s Bay had been grapes. And I thought, grapes can turn into high value wine.
“That got me really excited, and I started going around the wineries asking what services they needed to turn their grapes into high value product. The answer came back: storage and bottling.”

And that’s where it all started in Hastings in 1995. WineWorks Marlborough came three years later, with Auckland following in 2013. Today WineWorks Hastings has a workforce of around 100. WineWorks is a big enterprise. It has enough capacity to fill and pack a container every 10 minutes, meaning that a significant part of its operation is running supply chains. Trucks are arriving every 15 minutes from the glass plants, the mills that make the pallets, the cardboard plants, and the label printers, as well as trucks departing to load ships in the ports of Napier, Nelson, and Tauranga.

WineWorks is an integral part of its customers’ businesses, says Nowell-Usticke.
“Many of my clients say that their business couldn’t exist without us. That really gives me the warm fuzzies inside. After all, it’s not WineWorks’ growth, it’s the wine industry’s growth.”
WineWorks is the tool that wineries need to convert their product into high value wine, he says.
What other tools do they need? These days they need a good carbon footprint story.”

Adding value through sustainability

WineWorks’ sustainability journey began in 2019. The company knew it had to take a leadership position, and become carbon zero so that clients selling into carbon conscious markets like Scandinavia and the United Kingdom could secure listings.

Nowell-Usticke says it was the right thing to do.
“We also had several clients who had decided to be leaders in the field. Yealands Estate in Marlborough was one of those. They said: ‘We’re going to be the world’s first carbon zero winery’, and they couldn’t become carbon zero without help from us.”

The service that WineWorks provides to customers is a large part of the customers’ supply chain. Nowell-Usticke knew if WineWorks was to make the change for one customer, it made sense to do it for all, so the rest of the client base was asked if WineWorks going carbon zero would be of interest. The answer was an overwhelming yes, he says.
“I knew that our clients couldn’t claim to have a carbon free supply chain, if WineWorks wasn’t carbon free. That’s when we got involved with Toitū.”

Toitū Envirocare is a business specialising in carbon management and carbon neutral certification, helping businesses to realise efficiencies, reduce their carbon footprint, and be more sustainable. These days WineWorks is New Zealand’s only net carbon zero wine bottling facility, achieving this milestone in December 2023. Net carbon zero for WineWorks means the company has reduced or eliminated emissions, wherever possible, and purchased carbon offsets for any remaining emissions.

Starting out, WineWorks pledged to reduce carbon emissions by 30%, by 2023. It began by tackling the low hanging fruit: waste going to landfill, recycling, and electricity. Nowell-Usticke says the first moves on the sustainability journey are the easiest.
“We changed to a fully regenerative electricity company. We get supplied by Meridian from the dams, so there’s no Huntly power station component to the energy. That’s a big tick…saving us a good 20% of our previous carbon footprint.”

WineWorks’ North Island sites are powered by Ecotricity: the country’s only Toitū climate positive electricity provider. WineWorks Marlborough partners with Meridian and offsets emissions through carbon credits. Other electricity related initiatives include upgrading lighting to LED, installing timed motion sensors, and modifying high energy use machinery and/or changing how it was used.

WineWorks says the key takeaway from the energy part of its sustainability journey is that the changes made were simple, at the ready, impactful, and accessible for anyone to achieve.

Industrial scale recycling

WineWorks has made good progress.
“Four years ago we started recycling everything: plastic, paper, polystyrene, aluminium screwcaps, and put in pretty good systems around that.”

All waste glass is returned to the Visy glass furnace, and re-melted into new containers, minimising the energy required to convert beach sand into new bottles. Glass from Visy (NZ’s only glass furnace) is made of 70% recycled glass from New Zealand’s recycling process.
“It’s one of the best recycling stories in the world,” he says.
Plastic from packaging materials is sent to Replas, a plastic recycler, and made into slip-sheets that WineWorks puts under product when it packs containers.
“These are made from 100% recycled plastic. It is very satisfying for us to receive back these products that are made from our own waste stream,” says Nowell-Usticke.
All aluminium waste (screwcaps etc) are collected and sent back to the aluminium recyclers and made into screwcaps.

Next, we’re reducing waste, says Nowell-Usticke.
“One of the first things you do, is take the rubbish bins away, which is very difficult to start with. And suddenly you get used to not having a place to put rubbish, and then you start not wanting to order things because they come with a whole lot of packaging.”
As a proof point the volume of waste going to landfill at WineWorks Marlborough has halved in the last 12 months.

Other areas of focus include reducing the use of CO2 gas for wine protection and carbonation. Local shortages of CO2 forced innovation, with WineWorks Marlborough no longer using carbon dioxide, and instead using nitrogen to blanket tanks.
On the transport front, staff are permitted to travel between sites if essential, and truck movements at WineWorks Marlborough have been replaced by an electric tug, cutting 4 tonnes of emissions.

Carbon report card

WineWorks smashed its December 2023 30% emissions reduction target, achieving a 45% reduction in baseline emissions. Quite impressive, but dig a little deeper and the achievement is even better.
Nowell-Usticke explains: “Not only have we reduced total tonnage (of carbon emissions) by 45%, we did it while increasing production. Once you take in the reduced tonnage over a larger volume, it’s actually a 58% reduction in carbon tonnage, on a case of wine.
“Our trick, and we’ve done this much to my surprise, is to get bigger, and reduce carbon.”

Currently WineWorks is offsetting, buying carbon credits to compensate for the carbon emissions it can‘t eliminate from the business. It invests the offsets in New Zealand projects, with the balance in high quality international initiatives. Current New Zealand offsets are Spray Point Station carbon sequestration (40% of WW offsets), Native Forest Restoration Trust’s Puhoi Far North regeneration project, one of the largest privately protected bush areas in the Far North, boasting an array of recognised special biological values (40% of WW offsets).

What an expert says

Jo Pearson has deep experience in New Zealand’s wine industry, across sales, marketing and operations. In 2022 she established The Collective Impact, a sustainability consultancy, after becoming certified with the Global Reporting Initiative, provider of the world’s most widely used standards for sustainability reporting.

Sustainability, championed by Sustainable Winegrowing New Zealand (SWNZ, a world-leading, industry-wide certification programme led by New Zealand Winegrowers), has been a way for the New Zealand wine industry to stand out from the crowd in export markets, differentiate and support the premium positioning of New Zealand wine, she says.

“Tim has got in behind that with his business, with the bottling being a really key part of it … he is aligned with the wine industry in terms of being sustainable, and is helping to link the end-to-end journey from the soil to the consumer. WineWorks has got a part to play in that supply chain.
“He’s supporting the greater vision of the wine industry – the sustainable wine growing part – really well, and taken it even further and incorporated that into his own business strategy.
“If WineWorks didn’t tick that sustainability box, probably a lot of his wine customers couldn’t promote themselves as fully sustainable,” says Pearson.

What a customer says

Michael Ivicevich is the Group Technical Manager, Viticulture and Winemaking at Delegat Limited, that self describes as a leading global super premium wine company. Delegat has had a relationship with WineWorks since the early 2010s, when WineWorks started bottling Oyster Bay sparkling wine in Hastings.

Ivicevich explains: “We were wanting to do a Charmat sparkling wine, where the secondary fermentation takes place in a pressure tank rather than in bottles like a traditional champagne method. That required some extra infrastructure and some extra skills, so we brought the skills and WineWorks brought the infrastructure.
“We are currently at capacity at our Auckland winery, so rather than expand that site, additional volumes of still wine…are done by WineWorks.”
Delegat has been a member of Sustainable Winegrowing New Zealand for the past 20 years. All of its vineyards, wineries, and bottling lines are accredited to SWNZ; it’s something that Delegat makes mandatory.

“As a founding member of SWNZ, we are quite keen to support the industry, improving sustainability and be able to share learnings along the way. Working with people who have similar goals is really important. As a contract bottler, WineWorks is working towards the same goals as we are.
“What’s great about WineWorks is that they’re very active in the sustainability space, and they’re leading. They got out there first, they talk about it. To have a supplier that’s active, engaged, and a great communicator about opportunities, I think that’s really great.
“We work with WineWorks sharing data, sharing ideas, and trying to help the New Zealand wine industry, which is actually very collegial,” says Ivicevich.

What’s next? Scope Three emissions

Greenhouse gas emissions are categorised into three scopes. Scope 1 are emissions directly related to the reporting company’s facilities, including company vehicles. Scope 2 includes indirect emissions from the generation of purchased energy from a utility provider. Where it starts to get really hard is with Scope 3, which is all indirect emissions in the value chain of a company.
“For us, the next thing is Scope 3,” says Nowell-Usticke . “The glass bottle, the truck to the port, the shipping container from Napier to San Francisco.
“We’ve done our own processes, the things we can control. With Scope 3, you’ve got to go and talk to trucking companies (for example) and say ‘when are you going to convert to hydrogen?’
“It’s important to identify, and say there is two kgs (of carbon) per case of wine to get it to the port and another three to get it to San Francisco. And that’s the winery’s job to do, but we’re going to help.”

Harnessing the sun

carbon emissions per case already achieved, there’s not a lot to go, says Nowell-Usticke.
“It’s the hard part. Each gain we make from here is going to be small.
As soon as we start putting solar panels on, that will make a difference.”
With sites in two of New Zealand’s sunniest regions, installing solar panels is one of the next things that WineWorks will do.
Nowell-Usticke says the company has 28 acres of roofing, and a director on its board with experience in solar hot water generation.
“The economics of solar are (now) worthwhile, and it is the only way we can ever get to carbon zero without offsetting.
“I think we’ll probably start doing that (solar) within a year.”

After 28 years at the helm, Nowell-Usticke retired in 2022, leaving the running of WineWorks to his senior management team. Despite its founder stepping away, WineWorks’ founding ethos of adding value to New Zealand’s wine industry is stronger than ever, with sustainability now being a key part of the value creation story. Or as Nowell-Usticke puts it: “Creating the value here in Hawke’s Bay so that we can employ local families, and make brand owners wealthy rather than the Shanghai supermarkets or the London supermarkets.”

Not bad for a company that practically no-one has ever heard of.