Net zero refers to achieving an overall balance between greenhouse gas emissions produced and emissions taken out of the atmosphere. For the logistics industry, "net zero" means getting to a point where the amount of carbon dioxide emitted is no greater than the amount removed.
This is an enormous challenge for a sector that accounts for nearly 10% of global CO2 emissions. Yet, as the push for emission reductions grows, the sector is evolving traditional methods towards sustainable operations. Through innovations like electric vehicles and optimized logistics practices, an eco-friendlier and more efficient logistics industry is achievable.
Emissions from Logistics
The logistics sector, accounting for 5-6% of 2019's global CO2 emissions, is heavily impacted by emissions from road freight, mainly from larger trucks. Warehousing and packaging also contribute to its carbon footprint.
As transport demand grows, so do concerns about increasing emissions, which could hinder global targets under the Paris Agreement to limit temperature rise. To neutralize its emissions, the industry needs to revamp its transportation, storage, and packaging practices through new technologies and greater efficiency.
Government Regulations
Global efforts against climate change are enforcing tighter emission and fuel standards, particularly impacting logistics. Europe aims for a 55% emission reduction by 2030, necessitating major shifts within the industry, including penalties for non-compliance with vehicle emission targets.
The US, China, Japan, and many cities are pursuing similar paths, leading to the creation of zero-emission zones. Logistics businesses are pushed to quickly move to electric or zero-emission vehicles and support these with new technology and facilities. Adjusting to these regulations is essential for the industry's survival in an increasingly net-zero emissions-oriented future.
Electrifying Fleets
Logistics companies are prioritizing the shift to electric vehicles (EVs) to curb emissions, focusing on electrifying both long-haul fleets and last-mile delivery vehicles. Thanks to advancements in battery technology and more charging stations, EV trucks are becoming a practical alternative.
Large retailers and manufacturers are converting their own fleets to electric, which cuts emissions and urban pollution. To enable this transition, more charging facilities are being installed, and better route planning is addressing concerns about EV range. Broad adoption of EVs is central to the logistics sector's efforts to minimize its carbon footprint and move towards net-zero emissions.
Sustainable Fuels
The logistics industry is exploring sustainable fuel alternatives to traditional diesel that can significantly reduce emissions from transportation.
Major options include:
- Biofuels - Biofuels, such as biodiesel and renewable diesel, are made from renewables like vegetable oils and animal fats. They emit less than petroleum diesel, potentially reducing emissions by 50-80%, and are being adopted by various logistics firms for their fleets.
- Hydrogen - Hydrogen fuel cell trucks emit only water vapor, but creating eco-friendly hydrogen requires renewable energy. As renewable sources grow, so does hydrogen's feasibility as a clean fuel option.
- Synfuels - Synthetic fuels, known as e-fuels, are created by mixing green hydrogen with captured CO2. These electrofuels, similar to regular diesel but carbon-neutral, could play a key role in making heavy transportation more eco-friendly as costs decrease.
Transitioning to these lower carbon fuels will be crucial for logistics companies to reduce their climate impacts. Continued technological advancements and increasing scale will drive down costs over time.
Route Optimization
Route optimization is crucial for logistics companies to diminish carbon emissions. By employing software that assesses traffic, road speeds, and destination locations, businesses can avoid unnecessary trips, save on fuel, and lower emissions. These programs also consider return trips, enhancing efficiency. Experienced route planners' knowledge and a collaborative planning approach within the company further boost route effectiveness.
Given rising fuel costs and tighter emission rules, fine-tuning routes is increasingly essential, reducing travel, emissions, and improving customer service, all contributing to the industry's drive towards a net-zero future.
Warehouse Efficiencies
Warehouses play a critical role in the logistics industry's journey to net zero carbon emissions. By improving energy efficiency in warehouse buildings and operations, companies can significantly reduce their carbon footprint.
Here are ways for more energy efficient warehouses:
- Upgrade to LED lighting - Replacing traditional lighting with LEDs can reduce lighting electricity usage by up to 75%. Sensor controlled lighting also helps reduce energy waste in unused parts of the warehouse.
- Improve insulation - Adding insulation in walls, roofs and loading docks helps minimize heat loss in cold climates and heat gain in warm climates. This reduces the energy load on heating and cooling systems.
- Install solar panels - Solar panels on the warehouse roof generate renewable electricity to power warehouse operations and offset grid electricity usage. Any excess can be sold back to the grid.
- Energy efficient HVAC - Upgrading to an energy efficient HVAC system with features like variable speed fans and improved compressors and controls can achieve 20-30% energy savings.
- Smart energy management - Energy management systems allow close monitoring of energy usage patterns. This allows optimization of lighting, HVAC, refrigeration and other systems to minimize waste and match usage to operational needs.
- Efficient materials handling - Using gravity-based conveyors, mezzanines and efficient layouts instead of trucks for moving goods within the warehouse reduces energy usage in materials handling. Forklifts can also transition to electric/hydrogen fuel cell models.
Warehouses, with their vast size and continuous operations, have considerable scope for energy efficiency improvements, offering both environmental benefits and cost savings for logistics firms.
Carbon Offsets
Companies aiming for net-zero emissions are increasingly investing in carbon offsets, which involve funding projects that remove CO2 from the atmosphere, balancing out their own emissions. This strategy complements direct emission reduction efforts within a company. Reforestation, a favored offset method, not only captures CO2 but also boosts biodiversity and local jobs.
As the demand for carbon offsets rises, it's important for companies, especially in logistics, to ensure these offsets are trusted and well-documented. While not a standalone solution, carbon offsets are an important tool for advancing towards net-zero goals and eventually achieving full decarbonization of the industry.
The Future of Green Logistics
The logistics industry is adopting more sustainable practices and technologies to lower its carbon footprint. This includes using electric and self-driving trucks for more efficient routing, developing new packaging materials to minimize waste, tracking assets more precisely with advanced systems like blockchain and RFID, and making warehouses more sustainable through automation, renewable energy, and AI. 3D printing is also being explored for local production, which could reduce shipping distances.
Collaboration throughout the supply chain is key to these efforts. As these eco-friendly practices become more mainstream, logistics companies not only help the environment but also gain a competitive and economic advantage.