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How can we decarbonise the last-mile delivery?

Even though they cover short distances, last-mile deliveries represent a significant share of transport emissions. How do we reduce this share? And what can companies do to manage this last kilometre?

In the transport and logistics sector, the "last-mile delivery" refers to the final leg of an order's journey from a distribution centre or warehouse to the customer's home. Even though this section represents a relatively short distance, it nevertheless accounts for a disproportionate share of transport-related emissions, often reaching up to 28% of total global transport-related carbon emissions. Not only does this figure highlight companies' responsibility (especially with how they manage their e-commerce operation), but it is also a reminder of the importance of decarbonising last-mile deliveries, a crucial step towards a more sustainable transport system.

The factors behind the last-mile delivery's high carbon footprint

Several factors are behind this counterintuitive equation:
- Last-mile delivery vans are generally smaller (from 3.5 to 7.5 tons). Unlike bigger lorries that pool more together, making them finally more effective in terms of carbon intensity.
- urban traffic congestion: traffic jams, frequent stopping and restarting… increase fuel consumption.
- Low vehicle fill efficiency rate: delivery vans are rarely full on leaving the warehouse (in particular, to meet expectations and the demand for fast delivery). The van gets progressively emptier during the delivery round before returning empty or nearly. Over the last mile, a delivery van is subsequently mostly… empty! 

How can we decarbonise the last-mile delivery?

Last-mile logistics: decarbonisation strategies

Optimising the vehicle fill rate and distances

It is essential to have a multi-dimensional approach to effectively tackle the environmental impact of last-mile delivery.

Optimising delivery routes
can considerably reduce the distance covered and improve vehicles' fill efficiency rates. Route optimisation software can help to plan effective delivery routes, whereas cargo consolidation strategies combine several customers' or companies' deliveries to maximise vehicles' capacity. Delivery lead time management, allowing customers to choose all the way to specific delivery windows, can even rationalise operations and minimise congestion.

From the perspective of the fill rate, the idea is to pool delivery needs with those of other companies: co-loading, co-delivery… options that bring certain benefits. We are thinking in terms of the reduction in costs, transit times and the number of lorries on the road.

The constraints include ensuring compatibility of parcels, orders (separating those containing electrical components and those with chemical elements, for example), and the need for adapting to logistics that are already well-established.

How can we decarbonise the last-mile delivery?

Using logistics hubs

This approach involves optimising the supply chain using logistics hubs. It’s referred to as cross-docking.

Without cross-docking:

1 - Products arrive in the distribution centre from various suppliers using different modes of transport (FTL and LTL).
2 - They’re stored in the distribution centre.
3 - Customer orders are prepared and shipped from the distribution centre.

With cross-docking:

1 - The products arrive in the logistics hub from several suppliers.
2 - They’re sorted and consolidated, according to their final destinations.
3 - They are loaded into lorries to be delivered directly to customers.

Cross-docking offers a few benefits:
Streamlining the supply chain. Cross-docking reduces transit times between supply chain and customer.
Increasing transport efficiency. Consolidating lots of orders in an FTL lorry improves vehicle fill rates and reduces C02 emissions,
Reducing transportation costs. Overall, fewer journeys and deliveries are required.

How can we decarbonise the last-mile delivery?

Optimising the last-mile logistics

A route-planning app enables us to optimise the order of stops and reduce the overall distance covered.
This can considerably reduce fuel consumption, emissions, cost, and delivery times. Potential gain: 30% of distance covered!

Reducing empty space in parcels

Have you ever received an order in an oversized box? Packing more efficiently can save space, transport costs, and emissions.

In the supply chain, many parcels are bundled together, which makes them more difficult to pack and deliver. By reducing the empty space in parcels, we decrease the overall shipping volume, which has lots of practical benefits.

More compact parcels are easier to load efficiently, since trucks can carry more. We can use software to split parcels into a suitable size.

Using renewable energies for last-mile logistics

Electricity

Electric vehicles could be a good solution for reducing carbon emissions during last mile delivery. They are:

Permitted in low emission zones (LEZ):
Electric vehicles can zip around ‘Clean Air’ zones without paying tolls. They’re also contributing to better air quality in our city centres.

Reducing CO2: A huge amount of CO2 emissions are linked to transport. By replacing petrol or diesel with electric vehicles, we can significantly reduce emissions. (There’s a proviso: the electricity used to recharge them should come from renewable sources.)

Reducing sound pollution: Electric motors are much quieter than internal combustion engines. They’ll help to reduce environmental noise, especially in urban areas.

Perfect for the last mile: Electric vehicles are well-suited to “last-mile” urban use. They’re designed for urban mobility, especially short distances and numerous stops. Their capacity to accelerate quickly is ideal for driving in town.

There’s one potential drawback:
the EV's environmental impact depends on the energy source used during recharging. Using electricity generated by a coal-fired power station creates emissions at source. Using a renewable energy source like solar panels, wind power, or hydropower makes EVs much more sustainable. 

Hydrogen

Right now, hydrogen-powered light vehicles don’t provide the ideal solution for last-mile delivery, or for service in general. Why?  Because this technology is still in the development stage. Its energy efficiency is inferior because the hydrogen can come from polluting sources, cancelling-out the environmental benefits.

Using green hydrogen (from clean energy sources) is an option in countries where electricity comes from carbon sources, but the risk of using "grey" hydrogen (from fossil-based sources) makes this option uncertain.

Bioenergy

Bioenergy is a renewable energy produced from biomass. Biomass is an organic material that stores sunlight (through photosynthesis) in the form of chemical energy.

There are key advantages:

Reducing CO2 emissions. Mass balance systems produce lower greenhouse gas emissions, especially compared with electricity produced from fossil fuels. Biofuels and biogas can actually be generated from residual waste or dedicated crops.
Technology is ready. The technologies for producing and using biofuels and biogas are ready to be deployed on a large scale.

But biomass has disadvantages, too:

Similar air pollution to fossil fuels. Biofuel and biogas combustion emits nitrogen oxide and fine particles that pollute the atmophere, which can be harmful to human health and the environment.
Negative impact on biodiversity. The production of biofuels and biogas can lead to deforestation, loss of biodiversity, and direct competition with food production.
Greater strain on water resources. The production of some biofuel crops requires large amounts of water, exacerbating water stress.

"Mass balance": what does it mean?

The mass balance approach enables us to track and measure raw materials and products throughout the supply chain.  It can be used to monitor fossil raw materials, renewable raw materials, recycled products, and finished products.

The "credits" show us the greenhouse gas emissions which we have avoided. It’s a great tool for evaluating our efforts as we transition to decarbonisation.

Is a bike THE logistics solution?

When we’re thinking about last-mile delivery, especially in major cities, bikes quickly come to mind!  

But while a bike is well-suited to towns, it’s not ideal for all deliveries.

Right now, manufacturing a bike produces comparatively more emissions than a van, given that a van can travel up to 300,000 km during its lifetime. If cargo bikes were to improve in the future - becoming more durable and covering more miles - then they’d have a lower carbon footprint.

Of course, bikes are powered by renewable energy, while electric vans can be powered from a variety of energy sources. The energy mix can vary considerably from one country to another.

What about electric cargo bikes? These have a number of advantages for urban environments:

They’re permitted in Clean Air / Low Emission Zones (LEZ). Thanks to no-exhaust emissions, electric vehicles can circulate freely in urban areas where traffic restrictions exist. This contributes to better air quality.

They deliver a notable reduction in CO2. Electric bikes produce significantly fewer CO2 emissions compared to electric vans.

The technology is already here. Electric cargo bikes are already a working solution.
They drastically reduce noise pollution. Bikes are quieter than vans, improving noise levels in towns.

However, there are disadvantages too:
They have a limited charge and range. Electric bikes are mainly suited to short-distance deliveries (3-4 km) in densely populated urban areas.
They’re an expensive investment. Electric bikes can be more expensive to purchase than traditional vans.

Electric cargo bikes are useful for short-distance urban deliveries in large, polluted cities, especially in countries using a lot of carbon-based electricity. However, their limited range and higher cost make electric bikes a less commonplace solution for last-mile logistics.

How can we decarbonise the last-mile delivery?

In short, electric cargo bikes are an noteworthy solution for short-distance urban deliveries in large, dense and polluted cities, especially in countries with a high level of carbon-based electricity production. However, their more limited range and higher investment cost make them a less commonplace solution for last-mile logistics.

How can we decarbonise the last-mile delivery?

How can e-commerce reduce carbon emissions?

E-commerce continues to grow in France . By the end of 2022, we had 42 million people shopping online. 78% of consumers choose home delivery (source: Fevad 2023). This generates a huge amount of road transport, with the associated greenhouse gas emissions.

Then there are product returns -  a crucial stage in the supply chain. This stage requires additional transport (an extra round trip), more packaging, and waste management. The challenges facing the supply chain and e-commerce are still considerable!

Using bioenergy isn’t yet good enough - its disadvantages far outweigh just the question of CO2 emissions.  It has a significant impact on food security, biodiversity, and water resources, without significantly improving air quality.

So… finding the right balance in our energy sources is proving quite complex. While we wait for more sustainable energy solutions, optimising our logistics process could help us to reduce emissions. As we’ve learned, there are some interesting ways to reduce the carbon footprint of deliveries in e-commerce.

In fact, companies could significantly reduce their CO2 emissions and delivery costs by minimising the volume of parcels and optimising delivery routes. It’s a win-win approach that benefits companies as much as consumers.

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