Ingka Investments, the investment arm of Ingka Group, the largest IKEA retailer, announced that it has made a minority investment in BlackRock portfolio company Vanguard Renewables, and a partnership to turn food waste from IKEA stores into renewable fuel.
Renewable natural gas (RNG), or biomethane, is produced from organic waste, such as agricultural, industrial, and household wastes, and is chemically identical to fossil-based natural gas, enabling it to support the decarbonization of hard-to-abate sectors such as road transport and heavy industry, without needing to replace existing transmission and distribution infrastructure.
Founded in 2014, Massachusetts-based Vanguard Renewables develops and operates anaerobic digesters to convert energy from organic waste material into renewable natural gas, reducing reliance on fossil fuels. BlackRock’s Diversified Infrastructure business acquired Vanguard Renewables in 2022, in a deal reportedly valuing the company at $700 million, and with plans to invest up to another $1 billion to finance the company’s expansion.
Under the partnership, IKEA U.S. is currently piloting Vanguard Renewables’ food waste diversion service in five retail locations in Wisconsin, Connecticut, Massachusetts, and Illinois, with food waste such as leftovers from customer meals and unsellable packaged goods from the store’s Restaurants, Bistros and Swedish Food Markets being collected and transported to anaerobic digesters, and processed into RNG and low-carbon fertilizer for local agriculture.
IKEA said that it plans to expand the program to additional stores and locations nationwide following the pilot.
Javier Quinones, IKEA U.S. CEO & Chief Sustainability Officer, said:
“At IKEA, we see waste as a resource. With Vanguard Renewables, we’re turning our restaurant and Swedish Food Market’s food waste into renewable energy and fertilizer. After reducing our pre-consumer waste by close to 50% over the last seven years, the equivalent of saving 83,000 meals, we are excited about the next step. This partnership will make every plate count while improving our operational efficiency.”
Vanguard Renewables will join Ingka Group’s Circular Investments portfolio, launched by the company in 2017, to support IKEA’s circularity strategies by investing in companies developing technology or growing capacity to prevent waste or supply recycled materials, with a key focus on materials where recycling capacity is lacking, including mattresses, plastics, textiles, wood, and food.
The new investment follows plans announced by Ingka earlier this year to invest €1 billion in companies enabling growth in recycling infrastructure, with a focus on businesses that promote mass circularity, in order to increase the availability of recycled materials on the market, while avoiding millions of tonnes of CO2.
Peter van den Poel, Managing Director of Ingka Investments, said:
“Addressing our food waste challenge is not just good business, it’s essential for a livable future. This investment in Vanguard Renewables aligns with Ingka Group’s broader ambition to invest EUR 1 billion in scalable circular solutions across the value chain that address global challenges and build a sustainable infrastructure.”
Michael O’Laughlin, CEO of Vanguard Renewables, added:
“Vanguard Renewables is on a mission to divert unavoidable food waste from landfills and give it a second life as renewable energy. We’re proud to partner with Ingka to scale innovative food waste recycling solutions for retail supply partners like IKEA and deliver measurable progress toward a more sustainable future.”
