Decarbonizing Logistics – Interview with Prof. Alan McKinnon

What impact has the COVID-19 crisis had on CO2 emissions in the logistics industry? What is the role of innovation and technology in the green restructuring of the industry? What does the industry need to do now in order to unite efficiency, profitability, and environmental protection? And lastly, what can consumers do to help out? Alan McKinnon, Professor of Logistics and author the seminal work Decarbonizing Logistics, answers these questions in the following interview.

Why is it important to address the decarbonization of logistics?

The movement of freight, the operation of warehouses and freight terminals and all the related IT represent around 11-12% of energy-related CO2 emissions.  This represents a significant proportion of total global greenhouse gas emissions.  It is also a rising proportion as other sectors decarbonize more rapidly.  It is generally accepted that logistics will be a tough sector to decarbonize partly because the level of logistical activity is predicted to rise steeply over the next few decades but also because it is heavily dependent on fossil fuels, which are, of course, the main source of carbon emissions.  In recognition that we are now dealing with a ‘climate emergency’, more and more countries around the world are committing to being ‘net zero carbon’ by 2050 or earlier.  This target covers logistics, like all other business activities, and so its long term decarbonization is imperative.

How can universities that specialize in logistics incorporate environmental sustainability into their programs?

They can do this at various levels.  At the lowest level they can include the subject within existing courses on logistics strategy, operations management, corporate social responsibility etc.  At the next level up, they can create a dedicated module or course on the subject, perhaps making it optional initially and then adding it to the list of compulsory modules imparting skills that all logistics managers should have.  At the highest level, the institution can launch a whole Masters degree course or executive program on sustainable logistics, awarding formal qualifications in the subject.  As yet, few institutions have reached this level, though there is an increasing demand for such specialist education  and no shortage of teaching material available to those who deliver it.   KLU reached the second level a couple of years after it was founded in 2010 and is now planning to introduce a full Masters program on sustainability, which will have a strong logistics focus.

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Digital Lecture with Prof. McKinnon: Decarbonizing Logistics

 

 

 

In this KLU Executive Education course, Prof. Alan C. McKinnon, PhD looks at ways of reducing greenhouse gas emissions from logistics, mainly from freight transport operations. Participants of this digital lecture will gain an overview of the latest developments in climate change and the resulting decarbonization challenge. After concluding the course, they will have a better understanding of the measures that need to be taken to reduce greenhouse gas emissions to meet the targets set to decarbonize logistics and they are challenged to think about the implications the decarbonization challenge will have for their business.

Learn more about the course.

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What role is innovation and technology playing in improving the environmental performance of logistics operations?

A vital role.  A whole range of technological advances are helping to drive down emissions from logistical activity.   As far as freight transport is concerned, they are improving the energy efficiency of the engines powering trucks, trains, ships and planes while filtering exhaust emissions and promoting the shift away from fossil fuels to renewables.  Some of this change is visible, for instance, in the improved aerodynamic profiling of trucks, the recharging of battery-powered vans in urban areas and the cleaner air in towns and cities.  These technical improvements in vehicle hardware are being hugely supplemented by IT innovations, collectively know these days as ‘digitalisation’.  These software applications are helping companies to more fully load their vehicles and route them more efficiently,  saving money as well as cutting emissions.  It is not only the environmental sustainability of mobile assets that is being improved by technological change.  Carbon emissions from the logistics buildings are also dropping steeply as grid electricity is decarbonized, solar panels installed on warehouse roofs and the energy efficiency of internal processes greatly increased.

How can our new partnerships (with private and public organizations dedicated to promoting sustainability) raise awareness of the need to decarbonize logistics?

It is essential that universities, like KLU, which are actively studying options for decarbonizing logistics engage with these organizations to disseminate the results of their research and provide training on the subject.  A good example of such engagement is KLU’s ‘strategic partnership’ with the Global Logistics Emission Council set up by the Smart Freight Centre in 2014 to promote the adoption, harmonization and refinement of emission measurement in the logistics sector.  The university is also working closely with the European Freight and Logistics Leaders Forum on its sustainable logistics agenda.  Through such forums, universities can play a key role in alerting decision-makers in the private and public sectors to the magnitude and urgency of the climate change challenge and in advising them on how to deal with it.

What does industry need to do to make environmental improvement a core objective alongside increasing economic efficiency and raising profitability?

First of all industry needs to recognize that the objectives of environmental improvement, economic efficiency and higher profitability are not in conflict.  On the contrary, environmental and economic objectives are generally well aligned.  For example, many businesses are currently in the so-called ‘low hanging fruit’ phase of logistics decarbonization when many of the things that they do primarily for commercial reasons, such as training drivers to operate trucks more energy efficiently, also cut carbon emissions.  Regrettably, there is unlikely to be enough low hanging fruit around to allow businesses to meet their longer-term carbon reduction targets at little or no cost.  Further down the line, they will probably have to make some painful trade-offs between economic and environmental objectives, but at least in the short- to medium-term much logistics decarbonization will simply involve applying  good business practice.

How could changes in consumer behavior help to reduce the environmental impact of logistics?

Consumers, in other words all of us, can contribute to the ‘greening’ of logistics in various ways.  They can minimize waste, thereby reducing both the amount of stuff that needs to be distributed in the first place and then the amount of waste to be transported for disposal or recycling.  It is estimated, for example, that between 40 and 50% of post-harvest food is wasted, much of it in the home.  Second, consumers could switch to products with lower logistics-related carbon footprints.  This is much more difficult as they generally don’t know which products are better in this respect.  Often locally-sourced products are lower-carbon, but life-cycle analysis reveals that this is not always the case, because production operations are typically responsible for a much larger share of total life-cycle emissions than transport. Third, buying a product online and having it delivered to your home or a local collection point can cut emissions if the alternative is for you to drive to the shops to buy it.  Again, however, there is much debate over the relative carbon emissions from online and conventional retailing. Unfortunately, as yet, the consumer lacks clear guidance on this issue.

In what ways do you think the Covid-19 crisis will affect the environmental performance of logistics in the longer term?

It clearly had a big short term impact, reducing daily freight transport CO2 emissions globally by 28% according to the International Transport Forum.  This was a response to exceptional circumstances, however, and not an economically sustainable way to decarbonize longer term.  It is likely, however, that the Covid-19 crisis will reinforce longer-term efforts to improve the environmental performance of logistics in other ways.  Recent surveys suggest that many companies are now planning to manage their supply chains in a more resilient way, sourcing more products locally and easing just-in-time pressures. This could also yield environmental benefits.  The crisis has reinforced the swing to online retailing which, as I mentioned in my previous answer, may help to cut emissions from shopping-related transport.  The digitalization trend, which I also mentioned earlier, is likely to be accelerated, yielding further environmental benefits in the logistics sector. Not all Covid-19’s impacts will be environmentally advantageous, however.  Its negative effect on the finances of many companies and governments will reduce the resources available for green logistics investment.  It is very encouraging, however, to have seen public statements in recent months from large logistics providers confirming that they are maintaining their environmental commitments and targets despite the Covid-19 crisis. Let’s hope that they fulfil this promise.

In the fall season, Prof. McKinnon was invited to contribute to various international practitioners’ events dealing with either the decarbonization or the COVID-19 crisis, mostly giving the key note or main speech. Here is short review of the events. Find here a selection: