We take a look at how greener freight can not only reduce damage to the environment, but also reduce costs
The emergence of a raft of new green technologies within the freight sector is good news for companies looking to save large amounts of money, while at the same time better protecting the environment.
Freight is the fastest-growing source of emissions from transportation around the world, but the adoption of green technologies to counter the environmental impact can sometimes be held up due to lack of focus and public acceptance, or legislation.
In China for example, government policies tend to focus on private vehicles and public transport more than on trucks.
Whether it is the introduction of cleaner fuels, fuel economy standards, tax incentives or investments in infrastructure, fleet upgrades and information technology to improve transport tend not to cover the freight sector, which tends to be left behind.
Information on Asia’s Green Freight and Logistics website, is compiled through Clean Air Asia's green freight projects funded by the Energy Foundation and World Bank and support from several other partners.
Clean Air Asia believes there is huge potential to reduce fuel use and costs, and CO2 and air pollutant emissions from trucks across the continent.
A spokesman for the organisation says: ‘Empty miles – miles travelled without a load – is high and exacerbated by what can be classified as a fragmented sector. As a result, efforts to improve freight logistics could be improved.’
Currently, transport accounts for up to 40% of the world’s total energy use, but recent research in the US has also shown up the issue of empty miles. It has been found that up to 25% of trucks on the road in the US are empty and, for non-empty miles, trailers are on average only two-thirds full.
Estimates show that capturing just half of this unused trailer capacity would cut freight truck emissions by a staggering 100 million tons per year – 20% of all US freight emissions – and reduce diesel fuel expenditure by more than $30bn a year.
Shipping is another important, yet polluting, component of freight transportation, accounting for 3% of the world's greenhouse gases, according to the European Commission. That equates to an estimated billion tonnes of emissions a year – twice the carbon footprint of aviation.
Maersk Line, the largest container shipping company in the world, spends 20% of its total costs on fuel, so the logic behind investment in green technology is compelling.
The company has launched a ‘Triple E ship’ as an answer to the sustainability challenge. It is claimed the vessel is 50% more energy efficient than the average container ship sailing between Asia and Europe. It also carries 16% more cargo than the firm's next most fuel-efficient ship. The only downside is that its engines are 20% smaller, meaning slower, albeit more fuel-efficient journeys.
‘Last year, we saved $764m through energy efficiency improvements, roughly half our 2013 profit of $1.5bn,’ reports a company spokesman.
The Maersk Line revelation compounds the view that while green technologies involve upfront investment, they can provide a very strong payback.
While most e-companies recognise the importance of sustainability, cost is still a major factor and trumps environmental impact as a driver of behaviour.
Sustainable supply chain opportunities are often found to have the greater potential for financial return, with freight consolidation and network optimisation the most popular methods.
For companies willing to spend on sustainable technologies, nearly 60% require a cost payback within 18 months or less, according to analysts.
A perceived lack of return on investment and implementation costs are the largest obstacles to achieving greater supply chain sustainability.
US logistics giant UPS has broken the mould after buying 3,000 alternative fuel vehicles and piloting electrically assisted motorbikes for package deliveries.
It also uses package routing technology to minimise the distances driven and telematics – the onboard monitoring of driver behaviour – to tackle fuel inefficient idling and stop-start driving.
Telematics and other technologies helped reduce idling time by 254 million minutes in 2013, UPS claims – the equivalent of 17,000 metric tonnes of CO2.
Collaboration is a sustainable business trend that has rapidly grown over the last couple of years and which requires little if any initial outlay.
The 2014 State of Green Business report by Greenbiz.com discovered an uptake in the willingness of companies to work together on smart practices that reduce cost and improve environmental performance.
Drinks company Ocean Spray Cranberries was highlighted in the report for their willingness to collaborate with Tropicana. By working together, Ocean Spray was able to reduced carbon emissions from one of its key freight lanes by over 60% and cut costs for that lane by 40% – massively greening their freight operation.