The importance of sustainability and our commitment

The importance of sustainability in freight and logistics and our commitment

There can be no doubt that climate change is one of, if not the greatest challenges facing the world today and in the future.

We are now experiencing the dramatic toll global warming is having on people’s homes, health, and livelihoods all over the planet.

Extreme weather, plastic islands in the pacific, floods, and vast wildfires have hit the headlines, and we know unless we do more to prevent pollution it will continue to affect future generations.

The next decade is critical; we’ve no choice but to accelerate action to limit global warming. And as we emerge from COVID-19 more enlightened as to what we value, there is great opportunity as well as a responsibility to reshape the future to one that is fairer, inclusive, and sustainable. As a growing international logistics operation, we remain fully committed to play a leading part in the collective efforts needed to achieve a low carbon future.

The UK has committed to lowering greenhouse gas emissions in order to reach net zero by 2050. The severity of climate change on our planet is such that we need to take ambitious steps, and quickly in order to make a positive impact and set out a more sustainable future. 

In November 2020 the government released their ‘10 Point Plan’ for a ‘Green Industrial Revolution’, in which they announced a £5 billion budget to support a green recovery. With the view to generate new clean power with offshore wind farms, nuclear plants and investing in new hydrogen technologies.                

This is obviously important news for the Freight industry and means there is a lot of work to do in order to play our part in building a better, and greener future for our planet. According to the Transport and Environment Statistics Annual report (Department for Transport, 2021) in 2019, cars made up 79% of the road vehicle miles travelled within the UK, producing 55% of transport emissions, whilst heavy goods vehicles (HGVs) made up a much smaller proportion of the vehicle miles (5%) and yet their emissions were disproportionately greater at 16%. This is key in demonstrating that in order to create more sustainability within the freight and logistics sector we need to make more fuel efficient vehicles available for use.

Other countries have been progressing towards the use of low emission fuels and technologies for use in freight transport, such as electric vehicle grants, lower taxes on low – emission fuels, and clean air zones with charges or penalties for entering. We have also adopted these zones here in the UK with Low Emission Zones (LEZs) in London, Birmingham, Glasgow, and Bath with plans to roll these out to Manchester, Edinburgh, Dundee and Aberdeen later this year. 

Reducing emissions for heavy goods and freight vehicles does present a significant challenge, as alternative vehicles to the large diesel vehicles currently in use are still in development. The Net Zero Strategy, as outlined by the UK government in their ‘Build Back Greener’ plan, includes a zero emissions vehicle mandate; which will guarantee a greater number of zero emissions vehicles on roads, with investment in vehicle grants and electric vehicle infrastructure to ensure that there are more green vehicles delivering goods. 

Of course there are other ways in which the freight industry can use low emission technologies, in 2019 5% of rail freight was running on electricity, which is a proven technology for reducing carbon in freight. Battery powered HGVs have been trialed with Tesco providing the UK’s first commercial use of fully electric HGVs from this month. Alternative fuels such as synthetic fuel, hydrogen, Liquified Natural Gas (LNG) and Liquid Petroleum Gas (LPG) have also been taken into consideration. In the Government’s 10 Point Plan they outlined investment of £20 million in freight trials to ‘pioneer hydrogen and other zero emission lorries, to support industry to develop cost – effective, zero – emission HGVs in the UK’ as well as phasing out the sale of new diesel HGVs completely by 2035.

Our Commitment to Sustainability

Our evolving sustainability Strategy is closely aligned to the Group’s business strategy.

By being a responsible business, the Group has confidence in a sustainable and value generating business model.

We understand the importance of being an environmentally conscious Group and are taking steps to reduce the carbon emissions arising from our activities.

Environmental

We are committed to minimising the impact of our activities on the environment.

Our goals include:

• Minimising waste
• Utilising renewable energy sources where possible
• Transitioning our company vehicle fleet to zero carbon
• Developing and implementing carbon reduction initiatives Group wide

Operating in a corporate socially responsible manner is very important to the Board and we are committed to minimising the impact of our activities on the environment.

Our aims include:

• Minimise waste
• Use of renewable energy sources where feasible
• Transitioning of company vehicle fleet to zero carbon
• Develop and implement carbon reduction initiatives Group wide

Our Commitment to Lowering Emissions:

In order to understand our environmental impact, the Group records data on its energy use across all areas of the business. Our findings highlight that the majority of our energy use relates to the electricity and gas supply for our warehouse and offices. We calculate our CO₂ emissions through the kWh figures for gas and electricity use and the figures for litres of each fuel type used, which is then converted into CO₂ equivalent (tCO₂e) using DEFRA conversion factors. 

Emissions (tCO2e)	Year ended 31 December 2021	Year ended 31 December 2020
Emissions tCO2e	1,266	1,259
Emissions tCO2e per £m UK revenue	10.9	15.1
Emissions tCO2e per UK employees	2.3	2.9

There has been an improvement in the reduction of emissions within the group over the past twelve months; we must endeavour to build on this and ensure further improvements are earned through our hard work and diligence.

There can be no doubt that climate change is one of, if not the greatest challenge facing the world today and in the future.

We are now experiencing the dramatic toll of global warming on people’s homes, health, and livelihoods all over the planet.

Extreme weather, plastic islands in the Pacific, floods, and vast wildfires have hit the headlines, and we know that unless we do more to prevent pollution it will continue to affect future generations.

The next decade is critical; we have no choice but to accelerate action to limit global warming. And as we emerge from COVID-19 more enlightened as to what we value, there is also a great opportunity to reshape the future to one that is fairer, more inclusive, and sustainable. As a growing international logistics operation, we remain fully committed to play our part in the collective efforts needed to achieve a low carbon future.

We as a group will continue to listen to the experts and champion our customer needs as we start to help transform the way we all live, work and move through the decarbonising of power, heat, and transport.

To support this carbon transition strategy, we have partnered with one of the UK’s most highly rated environmental consultancies, Simply Sustainable, to help us design a future ESG strategy that meets our needs and exceeds the expectations of our stakeholders.

Electric Vehicles

We are currently in the process of transitioning our company vehicle fleet to zero carbon. Having already made many efficiencies, our focus is now on monitoring the technologies available, which eventually will allow us to fully de-carbonise our HGV emissions output.

• We have doubled the number of Electric Vehicles in the business since April 2021.
• EVs have helped us cut vehicle emissions over the past 18 months, with savings growing as the grid decarbonises.
• Green tariffs and lower carbon electricity for our colleagues to charge their EVs, will then enable us to reduce any remaining emissions from travel towards zero.
• Onsite EV charge points make it easy for colleagues to conveniently recharge their batteries, which is why we have over 20 installed across our sites. We will look to expand charge point availability in line with EV vehicle use.

Energy efficient property management

More than 80% of our energy use is in the running of our warehouses and offices. We will review energy ratings and green tariffs along with solar and other renewable energy sources to significantly reduce these emissions. We will build on these fundamentals and aim to use the same low carbon solutions as part of new acquisitions and new build sites as well as holistic measures for smaller, but still beneficial emission reductions.

Carbon Reduction Initiatives

LED lighting improvement projects have taken place across the European business:

• Pallex Bucharest
• Rainham
• Beckton
• Nidd Ripon
• Southampton
• Bulgaria cross dock operation

Property emissions

Whilst reductions in property emissions have been achieved with the installation of low carbon and energy efficiency technologies such as solar, LED lighting and improved building management controls, we’ll maintain focus on driving efficiencies and good energy management by adopting new technology as it appears, and seizing the opportunity to change the way we work to make further improvements throughout the estate.

Waste reduction

A full review of the waste strategy will be conducted to ensure that we have the best single stream waste solutions for the business to ensure the maximum efficiency in recycling and a reduction in our waste to landfill.

Our customers

With a clear symbiosis between ourselves and the carbon emissions coming from our customers, the biggest thing we can do to tackle climate change is to help them. That is why we have focused our efforts towards providing services and logistics solutions that will help our customers work sustainably and affordably.

• Pallex Romania consolidates multiple customers onto single transports to avoid the use of multiple vehicles and reduce the combined emissions otherwise associated
• We conduct stakeholder interviews to understand the needs, culture, and aspirations of our customers to align and improve outcomes.