Penny, a grocery chain in Germany, temporarily increased the price of some products by including their cost to the environment.
A well-known bargain retailer in Germany raised the pricing of a number of its products to reflect the true cost they have on the environment and human health. Last week, discount retailer Penny requested German consumers to pay more for select items to cover their "true cost" to increase awareness of the environmental impact of food production.
German consumers already enjoy some of Europe's cheapest groceries. However, the significant environmental cost of their inexpensive, frequently industrially produced food is a drawback. Last year, German agriculture was responsible for 55.5 million metric tonnes of the nation's emissions, or around 7.4%. Penny board member Stefan Goergens told Reuters, "We have to face the uncomfortable message that the prices of our food do not reflect the subsequent costs that arise for the environment and society."
Customers were assessed a fee for costs associated with the environment, human health, land and water during the "true cost" campaign at Penny's 2150 locations, which ran from July 31 to August 5, 2023. Around nine products were included, ranging from yogurt to vegan schnitzel and sausages. The cost they would typically pay was also displayed alongside the true cost. One type of Maasdam cheese increased by 94%, from €2.49 ($2.74) to €4.84 ($5.33).
According to Business Insider, "scientists determined that Maasdam cheese production costs 85 cents for emissions such as methane, 76 cents in soil damage from farming practices, 63 cents from pesticide use, and 10 cents from groundwater pollution."
However, one brand of vegan schnitzel only rose 5%, which suggested that some vegan products have minimal long-term environmental and health costs. According to figures provided by Penny to Reuters, organic products had environmental costs of an average of 1.15 euros, while non-organic products that relied on chemicals had an average environmental cost of 1.57 euros. It is unclear, however, whether consumers are prepared to pay more to reduce their environmental impact.
Shopper Holger Meckel at a Penny store in Frankfurt said, "I think it is good. I have to see how expensive the individual products have become. I'm not sure whether I would buy it. It depends."
Adding to that, Stefan Görgens, the COO at Penny, stated, "We know that many of our customers are suffering from today's unrelentingly high food prices. Still, we have to come to terms with one unpleasant fact of life: Our food prices do not reflect the consequential environmental costs that arise along our supply chain," reports Business Insider.
Despite Germany's recent drop in inflation, food prices remain 11% higher this month compared to 12 months ago. The company temporarily hiked some prices to comment on how food prices are not fully indicative of broader long-term environmental and health costs. Some customers applauded the idea, while others deemed it a stunt directed at consumers and not to the unsustainable agriculture practices themselves.
Austrian paper, EuroTopics, noted that "food prices are far too low" and demanding higher prices to account for environmental costs "only puts more financial strain on end consumers, many of whom are already struggling." All said and done, the only sure-shot way to preserve our environment is to take actual steps to reduce pollution.