GREEN CAPITALI$M

KFC’s recipe for cutting restaurant emissions by 46%

Decarbonization measures including optimizing exhaust hoods and food warming equipment will be required for new and existing franchisees.

By Heather Clancy

May 8, 2024

EV charging stations on are the future list of considerations for KFC franchisee "must haves." Source: KFC

New and existing KFC franchisees are being asked to follow the company’s stricter guidance for slashing their carbon footprint, through its Building Green initiative, a plan developed by KFC’s development and sustainability teams. That blueprint focuses on 11 “simple but meaningful” and mandatory measures it is encouraging, and planning to require, around the world, as franchisees build or refurbish locations.  

KFC is one of the fastest-growing food retail chains in the world, with almost 30,000 franchise restaurants and counting: There’s at least one new location opening virtually every day. Those stores account for at least one-third of KFC’s Scope 3 emissions, about the same as the footprint associated with raising the chickens that dominate KFC’s menu. 

Scope 3 accounts for the vast majority of emissions for fast food companies like KFC, usually above 90 percent. A 2018 survey by the National Restaurant Association found that slightly less than half were investing in energy-efficient equipment.

KFC will step up compliance requirements for its Building Green measures with new franchisees over the next 12 to 18 months, said Nivera Wallani, chief development officer at KFC. Existing franchisees must comply during remodels. 

“We are really rallying franchisees around growing in a more sustainable and purposeful way,” Wallani said. “You need to draw the line in the sand somewhere.”

KFC leads by example

The strategy is part of KFC parent company’s Yum! Brands’ plan to reduce the emissions per franchise restaurant by 46 percent by 2030, compared with a 2019 baseline. Put another way, that’s a cut of 96.2 metric tons of carbon dioxide per restaurant by the end of the decade. As of Yum’s 2022 sustainability report (its latest one), the company behind brands including KFC, Pizza Hut and Taco Bell had managed a 28 percent reduction.

KFC accounts for the largest physical footprint of those brands, more than 50 percent of Yum’s retail stores. Many of the measures that the subsidiary is embracing and resources it’s creating for franchisees will be extended to other brands over time, said Nira Johri, the chief sustainability officer at KFC, who marked her first anniversary with the company in March. 

“We think about it three ways,” she said. “We think about efficiency, we think about optimization, and then we think about renewables. The market will vary in which of these [franchisees] will deploy.” 

KFC supports these measures by working closely with equipment suppliers to specify standards, policies and guardrails for the franchisees. The goal is to keep these measures from becoming cost-prohibitive. Over the next two years, the “must haves” will become part of franchisee contract requirements, although the exact timeframe hasn't been solidified, Johri said. 

“This will be part of the way that we choose the franchisees that we want to grow with and partner with,” Johri said. “We’re adding this as a component of the culture.” 

 The current “must haves” for compliance are summarized in the graphic below.

 

Big energy cuts from rightsizing food prep and warming equipment

The ideas were originally based on ideas advocated under the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) program, but were adapted to suit KFC’s specific needs. 

In the past, for example, KFC restaurant designs were based on a standard template that specified a “one size fits all” exhaust hood and heating, ventilation and air condition equipment, which could be overkill from an energy consumption standpoint. Now, franchisees have options. Rightsizing cooking and holding systems used to keep food warm during peak periods, or that operate only as demand dictates, has helped save 4 percent on power consumption in the locations that use it. KFC-recommended changes to refrigeration and cooling can bring another 4 percent reduction, depending on the size of the location. 

Franchisees are also saving energy and money with changes to exterior and interior lighting, including new spotlights. That “simple switch” has led to emissions cuts of about 5 percent on average across the restaurant portfolio, Wallani said. 

Potential obstacles: Commissioning and procurement

Many franchisees welcome KFC’s ideas because they can reduce operational costs, according to Wallani.

That message will be crucial for franchisees, said Alastair MacGregor, national business line executive, who runs the U.S. building practice for consulting firm WSP. Providing a standardized approach helps, but local franchisees need to be empowered to make decisions that make sense for their local market.

Requiring rooftop solar panels, for example, wouldn’t make sense in a region where there is abundant hydropower. And improvements that require upfront capital costs are likely to be nonstarters.

“How do they make this economically viable to the franchise holder?” MacGregor said. 

Often, the biggest challenge is procuring equipment to meet KFC’s guidelines, so the company’s supply chain team works with franchisees to help with sourcing and negotiating pricing. KFC also requires an independent evaluation of locations as they embrace these measures,, the KFC executives said.

KFC's Green Line furniture is made of recycled materials and is modular, so it can be repaired piece by piece. Source: KFC

Coming soon: Recycled restaurant furniture, building materials 

The next “must have” on KFC’s Building Green blueprint — in some stories today and rolling out more extensively in 2025 — is highly durable furniture made from recycled materials. 

The so-called Green Line portfolio, developed by KFC in collaboration with business partners, is modular. That allows some pieces to be replaced if they become broken without having to rip out an entire chair, table or other item. The furniture is lighter, helping reduce related transportation emissions by 32 percent.

“Greener stores initiatives have been going on for some time,” said Jeff Clark, director of business engagement on food safety, nutrition and sustainability at the National Restaurant Association. “The low-hanging fruit has been plucked, and [KFC is] working on this more holistically.”