Do the right thing

XPO LOGISTICS UK and Ireland managing director Dan Myers says: “As a business, I believe we have a moral obligation to do the right thing. The great thing is we work with many customers who share that passion and want to work with us to help them decarbonise their supply chains. It makes my life so interesting, as so much development is happening in this space.”

A great example of the environmental commitment of XPO Logistics is its extensive collaboration with IKEA in recent years. 

“The two businesses are aligned with the same moral compass,” explains Dan. “Both businesses are responsible corporate citizens and are advanced regarding sustainability. Using battery electric vehicles for IKEA deliveries has been a big win for both companies, thus far we’ve done that without adding any cost to our customer and compromising the customer promise to IKEA.”

The 3PL has achieved this by creating efficiencies in its operation and making a financial contribution to the goal. XPO Logistics sees itself as taking the same journey as IKEA on sustainability.

The electrification of vehicles as part of the IKEA partnership is not the only initiative from XPO Logistics in this sphere. Other highlights include the certification of its first carbon-neutral site last year, the conversion of virtually all warehouse lighting to LED and PIR, and the introduction of around 35 longer semi-trailers (LSTs) for use in trunking operations.

Nor is the 3PL resting on its laurels. 

This year, XPO Logistics is not just planning to certify a further four or five sites as carbon neutral, but also establish one fully carbon neutral operation, which includes a warehouse, but also extends to the associated distribution from the facility.

In addition, XPO Logistics is considering expanding its use of solar PV and exploring a partnership with a local conservation society to best manage the firm's land in terms of biodiversity.

The firm is also running a trial at its Crick site on enhanced waste segregation to try to eliminate material going to landfills. The company has a diverse range of waste products at the site, which historically has made this task harder. It also looks at improving the sustainability of staff uniforms, both being able to recycle garments, the materials and exploring longer-lasting materials for uniforms and PPE. 

XPO Logistics also has several opportunities with customers where it is exploring changing their route to market – encompassing multimodal, domestic transport, and freight to and from Europe, all to reduce carbon intensity.

In addition, since 2016, all power used by XPO Logistics has been renewable, while since 2019, it has moved to only Tier 1 renewables – solar, wind, and tidal, for example. The firm generates some energy and pays a premium for certified renewable power.

Phew! It’s undoubtedly a broad-sweep commitment from the 3PL.

Dan explains: “I am passionate about sustainability; I think what’s happening to the planet should concern us all. The faster we can decarbonise, the better. It’s a truism in many situations that prevention is better than cure and it’s always less expensive. The more we do now, the better for everyone.”

Culture

The attitude to the environment flows throughout the company.

“Our people know this is important too,” says Dan. “Annette, an administrator in one of our warehouses, pulled me up the other day and said – why are we throwing these things away? And we have acted on that, improving the segregation of waste. She cares passionately; she’s thinking about her grandkids.”

While the what and why are clear for many people, the how can be trickier. Vehicle emissions are a huge challenge for transport companies. But how do you do it? Battery electricity works well for lighter vehicles but is much more problematic on the heavy side. In Dan’s opinion, there are too many competing options available at the moment, which is diluting the decarbonisation effort's effectiveness.

“Investment is spread thinly across many options, so progression is slower than if there was a more transparent policy, and the whole industry could get behind a solution with greater certainty. It would accelerate the process.

“Several options are available, and one will win, but no one wants to back the Betamax! Businesses want clarity and certainty when thinking about investments on such as scale.”

Dan sees a complex picture regarding alternative energy sources with no easy answers.

“Many say electrification is the route forward, but if you research generation, transmission, and storage and tally up what’s needed to decarbonise transport, the sheer numbers and requirements are daunting. A further challenge is that we are not the only industry that wants to go electric; it’s a common theme across many industries.

“We will see greater use of heat pumps in the home, and just look at the steel industry moving away from blast furnace production to electric arc furnaces, again for sustainability.”

Dan sees hydrogen playing a part, although perhaps it will support electrification instead of directly fuelling vehicles but as he acknowledges it’s not clear.

“With hydrogen, you have to look at where it comes from. Multiple different colours denote how they are manufactured. Green hydrogen is produced by electrolysis. When you have excess capacity in renewable electricity generation, you can electrolyse salt water, store the hydrogen, burn it to drive a gas turbine, and generate electricity when it’s needed. You can feed that into the grid.

“If you are going to use hydrogen directly in vehicles. The challenge is how to move it around.”

That said, looking at hydrogen’s performance in vehicles, the fuel has clear advantages.

“The distance you can get with an HGV powered by hydrogen is much farther than that of an electric battery, plus the recharge/refill time is much better. To recharge a 44-tonne HGV in 30 minutes, it is estimated that you would need a 2MW charger; that’s a big charger! It is expensive too.”

“One point I’d want to leave you with,” says Dan. “is my concern that the green agenda is dumbed down, it’s real and it’s serious, so tackle it today. Prevention is always better than cure.”

Indeed.