Tag Archives: logistics

NRDC OnEarth

Meet the Change Makers: How UPS Delivers Big Energy Savings | OnEarth

For UPS, the world’s largest package delivery company, no time of year is more challenging than the holiday season. This year, the Atlanta-based company predicts the surge of packages it handles between Thanksgiving and Christmas will exceed half a billion. That tidal wave will peak on December 20 when, on a single day, some 28 million cardboard boxes will be loaded into UPS’s iconic big brown trucks to be delivered, at a rate of roughly 300 per second, to homes and businesses around the world.

The challenge of getting those packages where they need to be using the least amount of energy possible falls to Scott Wicker, who was named UPS’s first chief sustainability officer in 2011. Like many of UPS’s top execs, Wicker is a lifer. He got his start in 1977 unloading UPS trucks while studying to become an electrical engineer. Some three decades later, it’s fair to say Wicker is still working in trucks. Yet today, as CSO, his mandate is to improve the efficiency of UPS’s entire fleet of 93,000-plus vehicles – which includes those brown vans, long-haul trucks, and cargo planes as well as gondolas and tricycles — along with the company’s global portfolio of more than 1,800 facilities.

True to his engineering roots, Wicker approaches this challenge quantitatively. Given that fueling the UPS armada generates more than 90 percent of the company’s carbon emissions, much of UPS’s sustainability efforts focus on its fleet, such as streamlining delivery operations, developing fuel-efficient technologies, and exploring alternative fuels. In 2011, those efforts helped reduce company-wide greenhouse gas emissions by 3.5 percent, even though total package volume grew by 1.8 percent, according to a 2011 report.

OnEarth contributor Adam Aston spoke with Wicker about how UPS has achieved these gains and become one of its industry’s top performers on sustainability.

If there’s a singular example of UPS’s focus on efficiency, it’s the left-hand turn rule in which delivery routes are designed for drivers to make as few lefts as possible. How did this come about?

It’s one of a long list of tweaks we’ve been making to drivers’ routes over the years. It goes back to the ‘70s. Back then, we saw that we were wasting a lot of time making left turns. The more time a van sits waiting to turn, the more fuel is burned idling.

Can you quantify the benefits of the rule?

Partly. It’s part of a broader set of efforts to eliminate idling. Last year we avoided 98 million minutes of idling. And less idling means less fuel burned. We estimate that this effort alone saved 653,000 gallons of fuel.

So fuel efficiency is as much about how vehicles are driven, as what fuel they use or how the vehicle is designed?

Yes, some of the biggest changes to our fleet operations are the least visible. Last year, for example, we estimate we avoided driving nearly 90 million miles thanks to improvements in routing and package-flow technologies. That translates into more than 8 million gallons of fuel not burned. Our technologies determine how to load each package and where each one goes on a specific shelf in the truck.

We’re also developing the ability to adjust routing on the fly. If the driver has to veer off a route for any reason, the system can recalculate the optimal delivery sequence. Further, the system will help the driver to mix more urgent, early-morning deliveries in between less urgent deliveries with later time commitments. In the past, this hasn’t been possible — instead, all urgent packages are delivered first, regardless of lost opportunities to deliver another package nearby.

It may sound minor, but these changes can help reduce the number of miles each driver travels each day. When you multiply a few miles saved per driver per day, the aggregated savings in time, fuel, and carbon are significant.

That said, is the push for a high-mileage truck still a top priority?

Yes. With more than 90,000 vehicles, it’s a constant concern. Our fleet of alternative-fueled vehicles is the largest in the industry, and one of the most diverse. Since 2000, some 2,500 unconventional UPS vehicles have racked up over 200 million miles in service.

Many are powered by natural gas, which we’re looking to as an alternative to diesel. For example, more than 900 local delivery vans are powered by compressed natural gas (CNG) in the U.S., and almost that many vehicles in Canada are powered by propane [a close relative of natural gas]. For long distances, we also have about 59 big rigs — highway tractor-trailers — powered by liquefied natural gas (LNG).

Rounding out the alternative fleet are 381 hybrid electric models that, similar to Toyota’s Prius, use a combination of combustion, electric motors, and battery storage to boost mileage. Because they recapture so much of their energy through regenerative braking, these models are especially well-suited to urban routes, where total miles travelled is short, with many stops and starts, and pollution control is important. We’re also running a small number of ethanol-powered vehicles and pure electric vehicles, which run solely on power stored in their batteries.

We’re also excited to announce that starting this month, we’re rolling out 40 hydraulic hybrid delivery vehicles. This is a continuation of a program we piloted with the Department of Energy and other partners in 2006. Instead of storing energy in a conventional battery, these vehicles use hydraulic fluid as the storage medium. When the vehicle accelerates, some of this stored pressure helps it to start moving. During braking, the process works in reverse: the vehicle’s momentum is converted into pressure to recharge the hydraulic tanks. It’s a remarkably rugged system that can save up to 40 percent of fuel.

Why pursue so many kinds of technology?

We’d like to get off of fossil fuels. That’s our goal. Our approach is holistic because there is no silver bullet. It would be foolish to try to predict which fuel will emerge as the best or most durable.

Can you squeeze greater savings from your conventional diesel trucks?

Yes. One of the things we’re most excited about is “lightweighting.” Last year, we rolled out a test truck that looks similar to our regular delivery van, but that’s built with advanced materials that shave off 900 pounds. There are body panels made of lightweight plastic composites instead of metal sheets. Because the vehicle is so much lighter, we’re able to use a smaller engine, as well.

The trucks deliver approximately 40 percent gains in fuel efficiency, and the price is in line with the cost of a conventional vehicle. Based on that trial, we ordered 150 of these higher-mileage models. We’re also more comfortable with composite material and will consider adding more composite components into larger vehicle types.

UPS operates a lot of vehicles consumers rarely see, from planes to long-haul trucks. What are you doing with these?

To put this in perspective, more than half of UPS’s carbon dioxide emissions come from jet fuel, and the rest of our mobile fleet make up about a third of emissions.

For surface transportation, we shift as much as possible to rail, which is a far more efficient way to move goods than road. For rail and air, the efficiency options are fewer than on the road. With planes, we’re testing more efficient flight paths. Simplifying a jet’s landing pattern, by letting it glide down continuously rather than descending in a step pattern, delivers substantial savings. We’re also testing aviation biofuel. We know it works. The problem is making it at the right price.

Are your customers asking for data on the carbon impact of their shipping?

Customers began to push for this kind of data a few years ago. Big companies are facing more pressure from groups like the Carbon Disclosure Project, the federal government, and financial entities to report on their carbon footprints.

It’s been a challenge to build a system that collects all this data. But today, we’re one of the few logistics providers that calculate Scope 3 emissions, which often comprise a very large share of the total. These are the emissions produced indirectly to make goods or deliver services a company buys. [Ed. note: Scope 1 emissions are created from direct actions, such as fueling a UPS truck. Scope 2 are emitted indirectly, such as the emissions associated with electricity bought by a UPS utility. Find out more here.]

When we ship for a company, or handle its logistics, UPS becomes a major source of the company’s Scope 3 emissions. Delivering that data reliably is a very sophisticated process. Our experience developing these measures has helped us advise partners on their efforts to map out their own Scope 3 emissions, too.

Have UPS’s sustainability efforts helped attract customers?

Yes. UPS is the only U.S.-based company offering a carbon neutral shipping option across all product lines. Puma, for example, ships everything carbon neutral. Toto [a Japanese bathroom fixture maker] uses the service, too. Another example is LiveNation, which organizes touring bands. We ship of all the bands’ gears in our trucks, and, in some cases, have begun to manage transport for those tours in a carbon neutral manner.

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Originally published at http://www.onearth.org/article/meet-the-change-makers-how-ups-delivers-big-energy-savings

GreenBiz

Cheap natural gas drives manufacturers, energy companies to shift gears | GreenBiz

Last week, Joe Nocera reminded me of how disconnected and angry the debate over fracking — the process of injecting fluids into deep, dense rock formations to fracture them and release natural gas — has grown. At The New York Times Energy for Tomorrow conference, Nocera moderated a series of panels that were focused on a broad variety of energy issues, but repeatedly returned to the hot button issue of fracking.

In a rhetorical question, he asked if the tradeoff in environmental harm and public health one we just have to accept. The answer is no, of course. But, as Nocera added, the fact is that fracking is already happening in a very big way. For those not following this issue, he’s an op-ed columnist for the Times who supports fracking as an innovation that, done responsibly, can lead to game-changing new supplies of energy, job growth and economic expansion.

Nocera’s position crystalizes much of the debate around this energy technology. His writing has drawn ire, especially in greater New York City and its hinterlands, where proposals to drill for natural gas in the city’s upstate watershed have sparked enough protest to turn the Hudson Valley into the epicenter of national anti-fracking efforts.

There’s good reason for alarm. ProPublica, a nonprofit investigative journalism entity has — in my opinion — amassed the best work documenting the environmental harm done by fracking. Here are just a few of the key environmental harms associated with the practice:

These issues make a strong case against the practice, and explain why Nocera’s “develop responsibly” position is controversial. The mixed reactions to his endorsement of the practice highlight the schisms dividing interest groups, coming between neighbors who are fighting over whether to frack or not and between national environmental groups who disagree about the environmental pluses and minuses of the practice.

For example, Nocera draws some of his analysis from work done by the Environmental Defense Fund, which is also pushing for tightly regulated fracking. Nocera’s approach has drawn heavy fire from climate activists such as Bill McKibben, a writer and scholar who backs a moratorium, arguing the risks of fracking are simply too high, as well as from Joseph Romm, a former Clinton-era energy official and now an influential climate commentator at Climate Progress.

Putting aside the fight over whether fracking should extend into new areas, Nocera’s talk drew my attention to a facet of fracking that gets less attention. Away from the main boxing ring where the issue is being fought out, large-scale industrial investment is rapidly reorganizing based on the long-term promise of low-cost gas. In short, industry is betting that fracking is here to say. Here’s where fracking already is impacting industry:

Power generation

The fracking binge has already altered the outlook for the U.S. power and manufacturing sectors. More than the rise of renewables, cheap natural gas has paved the way for the retirement of more than 100 coal-fired powered plants, too aged to meet federal clean air rules.

Efforts to build new coal plants are constrained too. Because natural gas power plants are cheaper to build and fuel, the natural gas boom has radically lowered the count of new coal-fired plants being proposed. According to data tracked by the National Energy Technology Lab and Sierra Club, plans for more than 160 coal plants have been shelved in recent years, partly due to natural gas’ cost advantage, as well as soft growth of demand for power.

“Natural gas has done more than other legislative initiative to push coal out of the equation,” said panelist Michael Levi, a senior fellow for energy and the environment at the center for foreign aaffairs, and by my reckoning, one the smartest observers out there on this issue.

Manufacturing

Cheap natural gas is rewriting the rules for other manufacturers too. Less than a decade ago, natural-gas-reliant manufacturers were decamping from the U.S., transplanting operations to the Arabian Gulf, Latin America and other gas-rich regions.

Now many are returning. Makers of chemicals, fertilizer and pharmaceuticals, all of which use natural gas as both an energy source and a raw material are returning stateside, lured by natural gas for under $2.50 per thousand cubic feet, less than fifth of the price in Europe or East Asia.

As Jim Motavalli reports in The New York Times, Nucor, which uses natural gas to make steel, is building a $750-million facility in Louisiana, just eight years after shutting down a similar plant in the same state and shipping it to Trinidad, to tap the island’s recently-developed natural gas supplies.

The cost advantage provided by cheap natural gas is even sharper for companies that use methane as a raw material — to make plastics, for example. Kevin Swift, chief economist at the American Chemistry Council, tells the Times that because European chemicals companies use oil-based raw materials derived to make plastics, the U.S. has a 50-to-1 advantage. “‘Shale gas’ is really driving this,” he says. “A million [British thermal units] of natural gas that might cost $11 in Europe and $14 in South Korea is $2.25 in the U.S. Partly because of that, chemical producers have plans to expand ethylene capacity in the U.S. by more than 25 percent between now and 2017.”

Add up the impact of investments like these and high rates of shale gas recovery could result in a million new manufacturing jobs by 2025, according to a 2011 PricewaterhouseCoopers study cited by Motavalli.

Transportation

Compared to current petroleum prices, natural gas costs $1.50 per gallon equivalent, nearly two-thirds less than current pump prices for gasoline or diesel. Large fleets of heavy-duty vehicles — from buses to garbage trucks to delivery vehicles — have been among the earliest converts. One-quarter to a half of Navistar’s new vehicle sales in these markets opt for natural gas.

Long-distance highway trucking may be the next to switch. Speaking with the Times, Navistar chief executive Dan Ustian, predicts that natural gas could capture up to a fifth of sales of highway tractor-trailers within a year.

The need for on-road refueling infrastructure remains a constraint. There simply aren’t many publicly accessible natural gas refueling sites. The count is under 1,000, less than 1 percent the number of gas stations. Last month, GE and natural gas producer Chesapeake Energy inked a joint venture to build 250 natural gas refueling points around the country.

Policy

Industry is clearly digging in even as environmental opposition gains momentum. Complicating the politics of this debate is that fracking is an intensely regional issue. State-level cultural perceptions of energy vary, for instance. Some families in Texas welcome gas rigs in their backyards, while some landowners in New York are suing to prevent nearby drilling.

Geology is different everywhere too, of course. So what was done safely in Oklahoma may not be replicable in Pennsylvania. “Local conditions matter significantly,” said Mark Brownstein, a panelist at the Times event and chief counsel for the Environmental Defense Fund’s energy program.

These polarizations have driven the debate to unproductive levels of ire, the panelists at the NYT event argued. “This is the perfectly dysfunctional fight,” said Levi, from the Council on Foreign Affairs. “There are environmentalists who believe this cannot be done safely. And there are those in the industry who say regulations will destroy their business.” The loudest voices amount to an all-or-nothing proposition, Levi added, which makes the process of brokering a solution to the fracking question very difficult.

There is a web of substantial existing regulation covering fracking, Brownstein explained, including the Clean Air Act, and the Clean Water Act. “The fundamental question is whether they are sufficient,” he said, and how to improve them if not. Another weak link he pointed to is variations in state level rules and enforcement of well construction, where one poorly built well, after all, can do enormous environmental damage.

Indeed, pointing to these weakest links, Levi made a case for the role of federal regulation. If one state underinvests or underenforces, a single disaster could stir up a far-reaching political backlash that could ultimately slow or halt development.

Some state-level policies, such as Texas’ tough disclosure rules on what frackers inject into the ground, can be cut and pasted to other state or national rules. New York State’s rules are also shaping up to be a benchmark in this respect. And some rules, such as the “Halliburton exception,” which excluded fracking from Clean Water Act standards for what is injected into wells, can only be fixed by an act of Congress.

With the scale of fracking rising, the stakes to get regulation right are growing — and making the fight harder to resolve. Some in the industry are beginning to welcome tougher regulation, recognizing that it could help level the playing field. If tougher regulations could ensure fracking can be done safely, but added 10 or 20 percent to unit cost of gas, the fuel remains cheap, Levi pointed out. “If I were a fracker, I’d rather have 20 cents extra charge” than the environmental and political risks facing the energy today, he said.

Check out Nocera, Levi, Brownstein and others here at The New York Times Energy for Tomorrow conference.