Developing low carbon logistics leveraging Electric Vehicles
Understanding how the logistics market can become more sustainable
What does the future of sustainable logistics look like?
Making the logistics market more sustainable can cover various spectrums from reducing carbon within the buildings a company operates out of, to reducing emissions from the vehicles that are used to transport goods through a network, to reducing carbon in the materials and packaging that are used by an operator. Companies are increasingly looking at all of these strands as they look to meet their own ESG targets and this is going to continue for the foreseeable. The advancements in technology and automation has seen an increase in the production of Electric Vehicles (EV), the type of EVs that have been produced and the range that they can cover. Additionally, companies are now using EVs within their supply chains to transport goods and looking forward as larger EV vehicles are produced, we see that they will be integrated into supply chains to help reduce emissions and ultimately meet their wider net zero carbon commitments.
How can we reduce carbon emissions from logistics activity?
Reducing CO2 consumption from the logistics market will rely heavily on taking CO2 out of the supply chain and one element of this is to look at transportation and how electric vehicles can be integrated into supply chains to help reduce carbon emissions. When considering where to introduce EVs into a supply chain, you need to consider the vehicles that are available and the range that they can cover. Given that EVs still have a relatively small range, their introduction has started in urban areas at the final mile of a journey where electric vans and smaller electric vehicles can be used.
What’s the market evidence/case studies we’ve worked on that support clients moving this way?
Parcel operators were one of the early adopters of this and in London, a number of micro fulfilment centres have opened where all electric vehicles operate. What we’ve seen more recently is that the on-demand online grocers who have recently entered the market in cities have been using electric scooters to undertake their final mile delivery.
We are working with many last mile providers who are using EVs in their final mile deliveries and are increasingly handling requirements for space for EV fleet charging. Alongside this, we are also working with EV manufacturers who are looking for space to manufacture and charge their own vehicles.
What are the main challenges/blockers to really decarbonising logistics with EVs?
As more companies look to electrify their fleets, one of the main challenges that we are starting to see is around capacity within the power network and accessing it, so that there is enough power to charge vehicles. Landlords are increasingly looking to futureproof their buildings by securing enough power that can allow for the building to operate, which can include highly automated warehouses which require significant levels of power, as well as having capacity to provide electric charging points for their fleets, occupiers and employees. We are likely to see how onsite power generation can be integrated into both new and existing developments to cater for the growing power needs.
How are government regulations supporting the transition to leveraging EVs as a solution in last mile logistics?
There is a push to creating cleaner air zones within cities this is changing the requirements for vehicles that are being used. The extension of the Ultra Low Emission Zone (ULEZ) in London is encouraging businesses to use more efficient vehicles for their last mile deployment and looking forward we would expect more government intervention to remove vehicles from cities and encourage the use of more EVs to move freight in cities. This will drive further demand for real estate in cities to undertake the final mile deployment. With the release of the UK governments’ Transport Decarbonisation plan in July 2021, we are likely to see a significant acceleration of plans from clients on their transportation needs across and within their real estate footprints.