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TRANSPORT : How can logistics help cut costs and carbon?

TRANSPORT : How can logistics help cut costs and carbon?. Jonathan Riley , partner, Pinsent Masons (chair) Gordon Telling , policy director, Sustainable Freight Solutions Morag White , director, Environment4logistics Jerome Saint-Marc , development director in logistics, Morrisons.

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TRANSPORT : How can logistics help cut costs and carbon?

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  1. TRANSPORT: How can logistics help cut costs and carbon? Jonathan Riley, partner, Pinsent Masons (chair) Gordon Telling, policy director, Sustainable Freight Solutions Morag White, director, Environment4logistics Jerome Saint-Marc, development director in logistics, Morrisons

  2. Gordon Telling Policy Director Sustainable Freight Solutions Saving costs and reducing carbon through Green logistics

  3. What is Sustainable Freight Solutions • Specialist guidance on: • Cyclist Safety • Out-of hours deliveries • Freight Quality Partnerships • Air Quality management

  4. Where does Carbon come from? • 1 litre of Diesel produces 2.65 kg Carbon Dioxide • Typical fuel consumption 8-10 mpg • 1.3kg per mile • Euro Standards – focussed on noxious emissions • HGVs are largest single emitters • Grammes per tonne/km are lowest with HGV

  5. So how can we reduce Carbon? • Fewer miles • Greener miles • Fuels • Vehicles • Operations

  6. How can we change Operations? • Shift delivery times • Consolidate deliveries • Encourage other modes of public transport

  7. Shifting delivery times • Road network is very congested between 07:00 and 09:00 and from 16:00 to 18:00 • Most customers want their deliveries....... • Out-of-hours / QDDS • Wandsworth trial 25,000l saving • 65 tonnes CO2!

  8. Consolidating deliveries • Consolidation Centres • Delivery & Servicing Plans • Sharing delivery vehicles • Sharing delivery locations • Construction Logistics Plans

  9. Encouraging other modes • - Promoting Cycling • - Improving Cyclist Safety • - 16 fatal collisions in London in 2011

  10. Cyclist Safety • - Ignorant Driver, Ignorant Cyclist • - Cycling Concordat • - Cycle Code • - Cycle Mark

  11. Can green logistics cut costs and carbon? Morag White Director E4L

  12. CONTEXT Context Total amount of freight movement stable at 2007 level Road share of freight tonne-kms reduced from 64% to 50% % of truck kms run empty reduced from 27% to 17% Average weight based load factor up from 59% to 70% 40% improvement in energy efficiency 30% reduction in the carbon content of the energy 80% reduction in CO2 emissions relative to 1990 www.Environment4Logistics.co.uk Source: McKinnon and Piecyk, 2009

  13. Policy Policy www.Environment4Logistics.co.uk

  14. Challenges Challenges • spend to accumulate • people power • industry paradigms www.Environment4Logistics.co.uk

  15. CULTURE Cultural paradigms www.Environment4Logistics.co.uk

  16. SUMMARY Reducing carbon can reduce cost BUT…. • Spend to accumulate – you can’t do this properly without spending something • A clear strategy is vital and realistic KPI’s important for measuring ROI • Board direction is needed but grass roots involvement cannot be ignoredas the enabler to successful implementation • The biggest rewards will only be achieved by challenging the norm and doing something completely different • The businesses that are brave enough to challenge the norm and do so successfully will be those the rest of the industry will be following www.Environment4Logistics.co.uk

  17. FINAL THOUGHTS Food for thought If we do nothing we wont achieve the high targets set. • More legislation & red tape? • Competitors? • The industry is watching the larger players however smaller supply chains and SME’s have more flexibility? www.Environment4Logistics.co.uk

  18. Thank Youmorag@environment4logsitics.co.uk www.Environment4Logistics.co.uk

  19. MorrisonsCarbon Approach to Logistics Jerome Saint-Marc Development Director

  20. Our starting point Context • Wm Morrison Supermarkets was founded in 1899, today we are the 4th largest supermarket in the UK. But also: • -The 4th largest Haulage company and • The 2nd largest fresh food manufacturing company • Morrisons is different to other UK food retailers because it is vertically integrated and controls all aspects of the Supply Chain – it has its own abattoirs, food processing factories, Logistics and Retail network. 24

  21. Context cont…./ • Morrisons employs over 134,000 colleagues and welcomes an average 11.5 million customers a week in stores. Annual turnover of £17.7 billion, over 475 stores and over 14,000 deliveries a week. • We take our Green credential extremely seriously and are the proud to have been recognised by the Carbon Trust.

  22. 13 distribution centres across the UK. Own fleet of 700 tractors and 1650 trailers. Gives greater control over provenance for our customers and the quality of food we offer. Our two newest distribution centres in Sittingbourne and Bridgwater demonstrate how we are investing in our infrastructure. Our Network

  23. Green Logistics • Over the last 5 years we have invested heavily in refreshing our infrastructure, both warehousing and transport and delivering the following: • -Reduced road miles by 12.5m from opening • Sittingbourne, saving 49,740 tonnes of CO2 over • last 4 years • -Our new DC in Bridgwater is one of the most • energy efficient DC in Europe (Breeam Excellent) • and contributed to saving a further 1.3m miles and • 1.7m tonnes of CO2

  24. Green Logistics cont…./ • Double Deckers • - Introduced 105 double decks with 80% more volume per trip. • - By end of 2012 we’ll have saved 15.3 million kilometres, 20,411 tones CO2 in two years. • Outstanding results mean we’ve decided to design all new stores over 15,000 square feet to accommodate double deck trailers..

  25. Green Logistics cont…/ • We Maintain our own transport fleet in house and are focusing on several programmes: • New oil – we’ll save a total of 4,327 tonnes CO2 by end of 2012 • New tyres – we’ll save 3,154 tonnes CO2 in three years. • New electric fridge points – we’ll save 5,916 tonnes CO2 in two years. • New air tabs- saving 1,127 tonnes CO2. • InMotion • Backhaul delivery service for suppliers. We’ll save 19.9 million kilometres in two years.

  26. Next Steps • Continuously drive improvement in reducing our Carbon emission • Work with our communities to provide better service to our customers • Assess and trial new development in assets, fuels and technology

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