So that’s a big target we got to work on. We’ve got a lot of very talented engineers in our manufacturing division and they went to work and they came up with 3 very great projects. And those projects are going to take us from using 75% renewable fuel in our wood fiber paperboard manufacturing facilities to 90% renewable fuel between now and 2032. So that, combined with the natural grid greening that we’re going to see just as the world around us gets greener between now and 2032, is going to get us 70% to 75% of the way to our 2032 target. So we’re almost there. Where do we look next? Well, our next largest source of emissions comes from our scope 2 category, and it comes from our purchased electricity across all of our operations. And that represents about 30% of our greenhouse gas emissions.
So we look at transitioning half of that to renewable electricity and wrap that up with modest year-over-year energy efficiency improvements in our operations that gives us a clear line of sight to hit our 2032 target and achieve that 50% reduction. So I’m not sure you’re saying, Michelle, that’s all great. You’ve got a road map. But what is that going to look like? And how is that going to play out over time? So let me show you. Right now, we are busy completing the construction and startup of our Waco facility. You’ve heard a lot about it. But while we’re doing that, and we’re laser-focused on getting — keeping that on schedule, getting that built and up and running, our engineers, they’re working on the engineering design, they’re working on the front-end loading.
They’re working on taking those 3 projects that they’ve identified to get them into the queue to start executing against them once we get post Waco. And the great thing about these projects, I mean, I think even more exciting than the fact that they’re going to help reduce our emissions is that they are already built into our capital plan, and they all deliver a positive return on invested capital. I mean how great is that? We’re not only doing good for the planet, we’re doing good for our business, and ultimately, that’s going to be good for our customer and the end consumer. So you can’t ask for anything better than that. And then on the same time line, while we’ve got my engineers working on the capital plan and the capital execution for our 3 projects, our procurement teams are actively working on trying to identify attractive renewable electricity projects.
And given that it takes a lot of time to; one, identify them and then enter through the contract phase and then the permitting phase and then the construction phase because we don’t want to just take annual RECS off the market. We want to make sure that we’re continuing to do our part to help decarbonize, which means looking for good projects that add additionality, additional renewable generation capacity so that they are truly removing emissions and not generating — just shuffling them from one place to another. So when you look at the lead times it takes to execute against all of that, we expect and project that we’ll start to see the benefits of those projects along the same time line as our capital projects, which shows acceleration of emissions reductions following Waco in sort of the second half of our period here.
All right. So we’ll move on to Scope 3. And just for your benefit you have another waterfall chart — same approach that we followed when we looked at our Scope 1 and Scope 2 pathway starts with understanding your current footprint. And when we look at our footprint for Scope 3 emissions, there are really 4 categories where that really stand out as our largest sources of Scope 3 emissions. One comes from all the purchased goods and services that we buy every day that we need to make our products. The second 1 comes from transporting our packaging products to the brands and the retailers so that they can put their products into it and then ship it to the consumers. The next 1 comes from what happens to our packaging at the end of life when the consumer is done with it.
And the fourth category comes from the upstream emissions that are associated with all of the fossil fuels or grid electricity that we purchase. So the nice thing is that if we execute well against all that Scope 1 and Scope 2 projects we talked about just now, that automatically will reduce that bucket of emissions for those upstream emissions because we won’t be buying those fossil fuels in that dirty grid electricity anymore. And then we get to the other groups, our procurement team, they are actively at work, working on their maps to understand where are the hotspots in our category 1 purchase goods and services emissions so that we can then put together and engage our suppliers to work with them. If they don’t have science-based targets, to get them to help set science-based targets to reduce their emissions, and then help them reduce their emissions, which then benefits us.
And same thing is going to happen with our transportation network. We’re going to be working with our transportation vendors to understand where do we have opportunities to maybe shift transportation modes from truck to rail, which would have a lower footprint, or to take advantage of some of the newer emerging technologies around electric trucks or hydrogen-powered trucks or biodiesel trucks that are then going to help us get our packaging, consumer packaging shipped to the brands and the retailers, with fewer emissions than what we do today. And lastly, and probably the most exciting one is how we’re going to think about that end of life. And Waco comes back here, too, is that there’s this perception that a lot of foodservice packaging and cups, in particular, are not recyclable today.
I don’t know why this urban myth continues to persist. But I was in Starbucks recently — I mean, at the Starbucks R&D Center recently, not even just a Starbucks, but at their R&D Center recently, where they are developing their new reusable cups. And I said, “Hey, this is great, but there’re just times when consumers are going to want a grab-and-go paper cup. They’re not going to want the burden of a reusable cup. We can recycle them. Let’s talk about partnering to recycle them.” And the R&D engineer at Starbucks told me paper cups are not recyclable. And I’m like, what? You guys are in Seattle. Seattle is one of the first cities to accept paper cups into curbside recycling. How can you tell me that it’s not recyclable. So we are going to partner with many in our value chain.
We’re actively working on doing this to be able to increase cup recyclability and acceptance and bring them back and be able to transform them into new packaging in our Waco facility, where even better is that, when we do that, we can create beautiful packaging that uses fewer materials because we don’t need as many coating materials on the top surface of the packaging. And that’s going to get — so when we look at all those 4 things together, that gets us about 70% to 75% of the way to our Scope 3, 30% reduction target. So we do have a little gap, and we have some ideas right now that we’re working on and how to address that gap. The first is how do we think about using our raw materials more efficiently and improving the yield on that because if we get more out of them, then we have less waste that we have to deal with.
The second gets to the waste, okay? We do a really great job today recovering and repurposing and recycling the paperboard waste in our manufacturing facilities, almost 100%. I think we’re at 98% right now gets recovered and recycled either by us or by third parties. But we want to look at the rest of the waste that we send to landfills, and how are we going to move that out of landfills and into beneficial reuse? And then the last thing we can think about doing that we’re really looking into right now is how do we get more recycled content into our unbleached and bleached paperboard and increase the recycled content there, all getting back to that consumer need or desire to want to have more recycled content in their paperboard. And we’re convinced that with all of our very smart and talented people working on this, that we’re going to close that gap and hit that 30% reduction by 2032.
So with my last slide, I just want to bring us back to full circle. We’re talking a lot about consumers and what the consumers want in consumer packaging, how our customers are responding. Many of our customers have set very aggressive greenhouse gas reduction goals in addition to their sustainable packaging goals. The plan that I’ve just laid out for you on how we’re going to reduce our greenhouse gas footprint, not only reduces our emissions, but it helps reduce our customers’ Scope 3 emissions and helps them achieve their net zero greenhouse gas targets that many of them have set. And in addition to all of the work that we’re doing to provide them packaging, that is more recyclable, has more recycled content and meets all their expectations around what they’re trying to do to make their packaging more sustainable.
But it’s even more than just helping our customers achieve their goals. It’s helping our customers meet the end consumers’ desire. Their desire is to have more functional packaging, more convenient packaging, packaging that comes with a lower environmental footprint and packaging with less plastic. So as we do our part to get better every day, we help our customers also get better every day. And with that, I’d like to turn it over to Steve Scherger, Chief Financial Officer.
Stephen Scherger: Thank you. Thanks, Michelle. Great to see everybody, and thanks for taking the time to join us today. We’ve covered a lot, as you would expect us to, including some new things that I want to touch on here in just a moment. Mike did a phenomenal job of, of course, laying out to the transformation of what we have become as a global consumer packaging company and the path forward for us to continue to execute on that with Vision 2030. I think Maggie, Jean-Francois provided enormous confidence that we have the innovation capabilities to grow consistently, 200-plus basis points a year in real new-to-the-market growth every year, and the pipeline continues to evolve and grow. And Michelle, I think, beautifully laid out for us that our commitment to the planet, our commitment to our customers, our commitment to the consumer is real and it’s investable.
And I think that’s very unique relative to who we are as Graphic Packaging. Let me touch on for a moment some of the things that we did touch on last night, Mike touched on it, Augusta. We’re very pleased that we’re entering into an agreement with Clearwater Paper for them to acquire our Augusta bleached paperboard facility. It’s a facility, as you know, about 600,000 tons of capacity as Clearwater Paper indicated. It’s operating today at roughly 70% to 80% of that. The acquired EBITDA, about $100 million. We’ll work through all the regulatory environments over the next few months and would expect to close the transaction in the second quarter. Importantly, on a pro forma basis, and this is as important as you’re thinking about what we’re about to share in our financial model.
Post the Augusta sale, that’s kind of the company that we are, roughly $8.8 billion, EBITDA in the $1.8 billion range plus or minus, margins in the 20%. That’s the business we’re going to build from here. So we’ll kind of start there, great balance sheet, 2.6x levered, this assumes we take the cash provided from the divestiture and put it against debt. And that’s the business upon which we’ll grow, and I’ll share those financial metrics with you in just a moment, but it’s important. Very important inside of that pro forma, probably the last time I’m going to use the word integration with you ever because this is a 90% integrated business, and 95% of our sales will be products that you, as a consumer, interact with. A 6-pack, a 12-pack, a cup, a bowl of canister.
It’s the products that we utilize, 95% of the company post the Augusta transaction. Let me touch briefly on the results. You’ve seen them. I won’t overdo this. Yes, it had all the challenges of a year, all the things we saw, destocking and all the activities, 3 quarters of down volume growth quarters 2 through 4, but the business performed at exceptionally high level during that period of time. We’re working with our customers to get paid for the value that we create for them. Margins increased 300 basis points. And as Mike mentioned, we’re off to a good start this year, and it’s important because pivoting to — back to organic sales growth in 2024, which we’re confident we will do, is important for us because that’s how we’ll earn on the model that we’ll talk about here in a moment.
But the innovation pipeline is working. $200 million of sales last year, high confidence in the next $200 million this year and beyond. And we’re off to a good start, year is off to a good start, as Mike mentioned earlier, a little flattish right now. That’s good. Because last year, in the first quarter, we were actually up modestly. And most of the headwinds that we felt through destocking, inventory management and the like, occurred in quarters 2 through 4, which gives us confidence that we’ll return to organic growth as we pivot and take advantage of the innovation pipeline as well as return to more normalized inventory management at our customers’ levels and at the consumer level. You’ve seen the numbers. You’ve seen the financials. I won’t overdo these.
At the end of the day, top line for the business, relatively neutral significant execution on getting paid for the value that we create for our customers. Volumetric growth down a few hundred basis points. 20% EBITDA margins, those are margins that we aspired to several years ago and we got to. And so we’re going to talk about how that pivot creates opportunity for us to grow EBITDA from here going forward. Balance sheet is in a good spot, at 2.8x levered, and margins, very, very strong coming out of the year. So execution worked, and it worked in an environment where we were very actively matching supply and demand. So if you stand back from it, we ran our manufacturing facilities to match the demand of our customers. And that demand, in some case, was down.
And so we match that supply and demand. And when we did it, we were able to do it cost effectively, wisely and still generate 20% EBITDA margins. And it’s a testament to the resiliency of the model, the nature of how we’re working our business every day. Let me touch on guidance. We’ve provided guidance, adjusted EBITDA, adjusted EPS, $1.75 billion to $1.95 billion on the adjusted EBITDA. All of this, of course, assumes currently the Augusta being a part of the portfolio. And so of course, down the road, we’ll adjust that for you and lay that out depending upon the timing of the close. Adjusted EPS in the $2.50 to $3 range. We provided the normal — some additional modeling stats for you. It’s there. I want you to have that in hand. One of the things that we’ll talk about here in a moment, and I’ll just point to it, this is peak CapEx for Graphic Packaging.
This is absolutely peak CapEx for Graphic Packaging. It will be driven down from here, and we’ll talk a little bit about that in a moment. Just briefly on Q1, we’re obviously actively continuing to manage and balance supply and demand. And kind of look through the first quarter, the open market paperboard sales that we have today will be down on a year-over-year basis, probably $60 million, $70 million or so. We’re managing and balancing inventory quite wisely here in the first quarter through that. As such, EBITDA in Q1 relative to last year, probably down $35 million, $45 million and that’s going to be very consistent with the guidance that we’re providing for you today. So just to give you a sense for kind of where Q1 is landing. And we feel very good about that.
We’d like the start that we’re off to with our consumer packaging volumes returning to more normalized levels, and that kind of sets the stage for the year that we’re looking forward to have. So let me drill a little deeper on the results side. As Mike said, and he said it extremely well, results are actually quite wide. This is about our people, our capabilities, who we are as a company, the impact we’re having on society, the impact we’re having on our customers. And then, of course, underneath that are the financial results that come along with that. And you heard us talk a lot about the portfolio that we have now moving with the consumer. It’s critical. Moving with the consumer is an imperative for us, and we have the portfolio to do so.
And that’s vital for us as we look forward because we’ve got this great balance of consumer staples products. We’re in your life every day, eating, drinking, enjoying the home, life that you have, being on the go, we’re in your life on a staples basis, on a day-to-day consumption basis, which gives us incredible stickiness on the volumes and the capabilities of the business. And so let me drill down a little bit here for you with something new. A lot of arrows here. What you’re going to hear us talk a very different language as we kind of move forward with our business. We’re going to be talking to you about how are things going in the food market? What’s happening there? What’s happening with beverage? What’s going on with the consumer on foodservice?
What’s happening with our household business? And so this is going to be a new disclosure. It’s going to be a new conversation for us with you, which is what’s going on here inside of these markets? And let me give you a couple of examples. 2022, talked a fair amount about it. All the arrows are up. By the way, up is greater than 5% growth of sales, sideways 2% to 5%, sideways this way or up this way 2% to 5%, diagonal, plus or minus 2%, the opposite direction on the red, pretty straightforward. 2022, beverage was up over 2% to 5%. That was the year that we just talked about. It was the realities of COVID. It was the realities of supply chain challenges, inflation, price needing to move up to deal with the realities of inflation, some of the onboarding of folks buying more than they necessarily needed.
So every arrow there is just up. But in 2023, there’s a little bit more of a normalization, it’s our ability to articulate to you as an investor, what’s happening in this business? Talk about food for a moment. First part of 2023, pretty solid. Volumes are hanging in there. And then we kind of went through the destocking, and it showed up. It showed up because volumes came down quarters 2 through 4, more than offset the pricing that we were working through with our customers. And you saw some downs for the year, relatively flat, pretty good outcome, actually, given everything that we work through on food. Beverage, it’s a great business. It’s a business that continues to grow, grow globally, all the innovation activities that we talked about and really throughout this growth up, but a little neutral in ’23, pretty well chronicled actually in terms of what was going on with at-home consumption, which is where we play in beverage.
And so yes, pretty neutral. Foodservice, it’s a franchise. It’s a phenomenal business. It’s on-the-go consumption. It’s innovation. It’s our cups. It’s you driving through the drive-thru. Up consistently, and up again here in the first quarter of 2024. Household, think about that, things like laundry detergent. Think about filter frames, think about pet food. We don’t put pet food in the food. We put it down in household. Everybody bought a pet in the 2022 time frame, we didn’t fall out of level of our pets, but we didn’t buy as many treats. And so we actually saw a little bit of activity on our household business. And so a little bit less growth. Okay, got it. It’s kind of played itself out to withdraw, but we want to call those things out for you to articulate what are we seeing and what are we doing about movement in those categories?
