We introduce Extended Density Matrix Embedding Theory (EDMET), a static quantum embedding theory explicitly self-consistent with respect to two-body environmental interactions. This overcomes the biggest practical and conceptual limitation of more traditional one-body embedding methods, namely the lack of screening and treatment of long-range correlations. This algebraic zerotemperature embedding augments the correlated cluster with a minimal number of bosons from the random phase approximation, and admits an analytic approach to build a self-consistent Coulombexchange-correlation kernel. For extended Hubbard models with non-local interactions, this leads to the accurate description of phase transitions, static quantities and dynamics. We also move towards ab initio systems via the Parriser-Parr-Pople model of conjugated coronene derivatives, finding good agreement with experimental optical gaps.