The future of retail is shifting. On-line shopping is seeing rapid growth worldwide raising the question of how E-commerce is impacting the environment. A recent report commissioned by Stand.Earth looks specifically at the climate impacts of parcel delivery on a warming planet. (This article is sourced from the report.)
Climate Impacts of Parcel Delivery
“In the past decade, the “Amazon effect” has determined the features of the delivery sector: shipping and returns have to be fast and free. After the e-commerce sector tripled in size between 2014 and 2019, restrictions related to the Covid-19 pandemic led to a further boom in parcel deliveries in 2020. This has resulted in more packages, more vehicles, more local pollution, more drivers, more waste, and, critically, more CO2 emissions.” — Parcel Delivery on a Warming Planet
The report looks specifically at the negative impacts of the last-mile parcel delivery system of the six leading e-commerce companies: Amazon, Deutsche Post DHL Group, FedEx, Flipkart, UPS and Walmart.
Key Findings and Takeaways
- Transport will be the biggest source of new greenhouse gas emissions in the decades until 2050. According to the World Economic Forum (WEF), delivery vehicles in the 100 largest cities around the world accounted for 19 million metric tonnes of CO2 emissions in 2019. The number of delivery vehicles is expected to increase by 36 per cent in 2030.
- The negative impacts of last-mile deliveries are felt most prominently in cities. They endure increasing greenhouse gas emissions and also struggle with traffic congestion and air pollution caused by the increasing number of delivery vehicles, their emissions, and second-lane parking. If cities are to reach their decarbonisation targets, it is essential to reduce emissions of the parcel delivery sector.
- To keep warming to below 1.5℃ and avoid the worst outcomes in the climate crisis, we must accelerate decarbonization of the world’s vehicle fleet by 22 times faster than current trends. In every case, these companies’ commitments are insufficient to support the goals of meeting the 1.5 degree target.
- E-commerce is a major driver of retail sales globally and a significant source of carbon pollution. This has resulted in a proliferation of packages, drivers, waste, local pollution, and carbon emissions from parcel-delivery companies’ “last-mile” operations, which refers to the trips between a transportation hub and a customer’s home or business.
- These companies’ targets and plans are woefully inadequate to decarbonize quickly enough and at the scale necessary to avoid the dire outcomes of the climate crisis. Several companies lack these plans and targets entirely, while others lack transparency and shroud the pollution and environmental impact of their parcel-delivery operations from the public and consumers.
- Although all six companies demonstrate awareness of the environmental impact of last-mile deliveries and have set targets to reduce their emissions, all companies need to substantially accelerate their efforts to achieve their fleets’ electrification and emissions targets. They have generally failed to formulate goals that are sufficiently ambitious and do not provide clear and accessible data on current progress and the measures they are taking.
- Most companies have set company-wide emissions targets, ranging from “zero emissions” (Walmart, own operations only), to “net-zero emissions” (Amazon and Deutsche Post DHL Group), and achieving “carbon neutrality” (FedEx and UPS). Target years vary as well. While Amazon, FedEx, and Walmart aim to achieve zero or net-zero emissions by 2040, Deutsche Post DHL Group and UPS have set 2050 as their target year.
- In absolute terms, Amazon is the largest emitter of greenhouse gases, with total emissions measuring over 60 million metric tonnes of CO2 equivalents in 2020. Walmart is the only company whose emissions in 2020 were lower than those in 2016, while Amazon reports an increase of over 30 per cent between 2018 and 2020. The total emissions of Deutsche Post DHL Group, FedEx, and UPS appear to have stabilised between 2018 and 2020.
- Flipkart and FedEx have set target dates (2030 and 2040, respectively) for the full electrification of their delivery vehicle fleets, while Walmart plans to eliminate all emissions from its fleet by 2040. Deutsche Post DHL Group has set a target year for the partial electrification of its fleet (60 per cent by 2030). Amazon has set a partial net-zero fleet emissions target, while UPS does not have a concrete fleet-related emissions goal at all.
Parcel Delivery on a Warming Planet shows that the E-commerce sector must speed up the decarbonization of its vehicle fleets to reduce their climate impact. The growth of online buying is far outpacing the efforts and ambitions of the six companies investigated in the report.
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