If you think being green is for the “greenies” then perhaps you need to think again.
Being green is easier than you think and it’s cheaper – yes, cheaper. As our planet continues to warm and reach record temperatures we are seeing the adverse effects of climate change across the globe and here at home, including the increased coral bleaching of our Great Barrier Reef. With the world’s population growing from 1 billion only two hundred years ago to fast approaching 7.5 billion, we have seen a substantial increase in the use of water, land and energy. We now use 85 million barrels of oil each and every day. Considered by scientists as the world’s cleanest air, Cape Grim in Tasmania has just recorded carbon dioxide measurements above 400 parts per million (ppm) for the first time on record. This is an increase of 33% since measurements began only forty years ago in 1976 in the Southern Hemisphere when the measurement was 300 ppm.
Fortunately, a historic global climate agreement was agreed under the United Nations Framework Convention on Climate Change (UNFCCC) at the 21st
Conference of the Parties (COP21) in Paris. Some of the key outcomes include a global goal to hold average temperature increase to well below 2°C and pursue efforts to keep warming below 1.5°C above pre-industrial levels, as well as all countries to set mitigation targets from 2020 and review their targets every 5 years. With this most recent Climate Change Agreement, Australia has set an ambitious target to reduce emissions by 26-28 per cent below 2005 levels by 2030.
To give this further perspective, as reported in Australia’s Second Biennial Report (December 2015) on our greenhouse gas emissions, energy use represents 75% of our total emissions. Electricity generation may be the largest contributor to our carbon emissions, but the transport sector is in the unenviable position of second representing over 22% of all energy related emissions and 17% of all carbon emissions. Disturbingly, while Australia’s total emissions have only increased by about 1% from our 1990 levels, the transport sector’s emissions have increased the most of any group by over 50% and are projected to grow further as a result of estimated increases in transport activity, largely driven by economic and population growth.
“Road transport is the dominant source of transport emissions. Road transport includes private passenger vehicles (cars and motorcycles), light commercial vehicles, rigid trucks, articulated trucks and buses. Cars are the largest contributor of road transport emissions and projected to increase steadily due to continued growth in the number of passenger vehicles, the recent drop in oil prices and increase in diesel consumption. Freight transport (rigid trucks, articulated trucks and light commercial vehicles) has a greater increase in emissions over the projections period due to increased activity and limited uptake of low emissions fuels. Freight task is projected to increase to in line with economic growth and continued growth in coal and iron ore exports. Road fuel mix is dominated by petrol and diesel, accounting for 95 per cent of fuel consumption in road transport in 2015. A similar trend is projected to continue into the future due to relatively low oil prices resulting in subdued uptake of alternative fuels in the road sector.” (Australia’s Second Biennial Report – December 2015).
How do you measure up?
Now that you are aware your transport operations are a major and increasing contributor of all carbon emissions, what can you do about it? And if this still isn’t enough to convince you that you should be reducing your carbon emissions, then perhaps the prospect of increasing the profitability of your fleet by significantly reducing your fleet operating costs is? Running a greener fleet costs less with reduced operating costs increasing the profitability of your fleet. So there’s a very good reason even for the climate change deniers to run a green fleet!
So just how can the fleet management professional run a greener fleet? Thankfully, there are a number of strategies that can put into place to reduce your carbon emissions. The old adage “you can’t manage what you can’t measure” is still true today, so a good place to start is by measuring your carbon footprint. If your organisation chooses to reduce carbon emissions for all of their operations you will first need to determine your carbon emissions boundary. Following this you will probably find that like most organisations your transportation activities are a major if not the primary contributor to your carbon emissions, particularly if you have a large fleet travelling many kilometres. Remember, this includes your company vehicles as well as your grey fleet vehicles – where employees use their private vehicles for your business purposes.
And if you follow the Federal Government’s National Carbon Offset Standard you will also need to measure the commuting of your employees to and from their workplace. Real time reports can be utilised from specialist third party fleet management organisations for real-time web reporting with in depth and up-to-date analysis of the fuel performance and carbon emissions from our fleet. The litres being used by each and every vehicle per kilometre travelled as well as the amount of Co2 emissions measured by gram per kilometre, as well as overdue service reports to enable regular servicing of vehicles for efficient handling including effective tyre management for improved fuel efficiency. Whether it’s a real-time web report that can be run at any time of the day or real-time ‘true’ dashboard reporting in your fleet vehicle, there are various carbon emission reports available for you to measure your emissions. Once you have measured your carbon emissions you effectively have a baseline from which you can reduce.
Less is more
While it is generally true that very early adopters do usually pay a higher price, it is time to bust the myth that being green costs more. Green technologies and methods are developing all of the time and some have already been around for quite some time. You don’t always have to be the first to adopt the latest green technology, but if you aren’t adopting any then you are already starting to fall behind and you’re missing out on their benefits. Quite often now the greener less emitting option is the cheaper option.
So just what options are available to green your fleet so you can save on emissions and money?
Well, thinking before you buy will assist in choosing a more economical fleet. Australia already has a mandatory consumer information programme that mandates fuel efficiency labelling on all new cars, as well as a voluntary programme through the Green Vehicle Guide that aims to assist consumers to make informed purchasing decisions. Vehicle fuel efficiency ratings are available for every motor vehicle sold in Australia via the Federal Government’s Green Vehicle Guide and vehicles are compared against one another in terms of both their greenhouse gas and their air pollution ratings.
“In November 2015 the Australian Government announced that it will provide incentives for Australians to purchase low emissions vehicles, as part of a A$50 million program funded through the Clean Energy Finance Corporation (CEFC). The program provides corporate and government fleet buyers, as well as not-for-profit organisations with access to favourable loan interest rates when choosing to purchase eligible low emissions passenger and light commercial vehicles.
The CEFC is providing up to A$120 million through the National Australia Bank for a program to incentivise Australian businesses to cut their energy and operating costs and lift business performance. This initiative is designed to accelerate the switch to low emissions and cleaner vehicles. In order to be eligible for the CEFC finance, purchasers must ensure the vehicles meet a CO2 emissions threshold that is 20% below the most recently published Australian averages for new passenger and light commercial vehicles.” (Australia’s Second Biennial Report – December 2015).
Given these options and incentives, you should be including environmental criteria in your tender process when procuring manufacturer’s vehicles by prescribing a minimum Co2 emissions measured by gram per kilometre from the green vehicle guide for your vehicles. In addition, other third parties such as Australia’s Best Cars are also considered for their environmental ratings of vehicles.
Consider vehicles with alternative fuels such as dedicated Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Biodiesel, Ethanol, Propane, Hybrid Petrol or Diesel/Electric, Hybrid plug-in, complete electric vehicles or even Hydrogen Fuel Cell. Real measurable reductions in emissions as well as fuel costs can be achieved with these types of vehicles.
“With an estimated 450,000 fleet vehicles on the road today, this represents a major share of the cars and vehicles on Australia’s roads. Because of the number of vehicles within their operations, Australian fleet buyers and lessees can play a key role in increasing the proportion of low emissions vehicles on our roads,as well as the adoption of new solutions such as electric and fuel cell vehicles.” (Australia’s Second Biennial Report – December 2015).
As part of considering the green credentials of vehicles you can easily pursue a progressive downsizing strategy. Traditionally, larger vehicles have been over-used in many fleets when a smaller, more fuel efficient vehicle would be fit for the same purpose. You can progressively move towards more fuel efficient vehicles as part of your procurement process. This will see a notable shift from larger six cylinder products to smaller four cylinder products, as well as a shift to more fuel efficient products within the same cylinder class. The result being less fuel and fewer emissions.
Time to behave
Once you have the right vehicles to lower emissions, you should consider how these vehicles are being used. Historically, the motor vehicle has been considered a right of many employees to have full choice and exclusive use of their salary packaged vehicle. However, this may be an expensive option to try and retain employees with potentially under-utilised and fast depreciating assets remaining idle for too long in the company car park. Perhaps these days are coming to an end with the motor vehicle increasingly seen as a privilege, not a right. For light passenger fleets, the company’s vehicles can be shared across the organisation, whether they are an unassigned vehicle or part of someone’s salary package. Salary package pricing discounts can be offered to staff to
encourage them to leave their packaged vehicle in the company pool during business hours of operation. That way every car can be a pooled car, even the CEO’s. This helps to reduce the total amount of vehicles needed in your fleet and further encourages the sharing of vehicles to limit your carbon footprint.
Car sharing is now becoming very popular with start-up businesses disrupting the marketplace.
Not only are private individuals and families making choices to utilise car sharing programs, but so are businesses. Some organisations are complementing their company fleet with shared vehicles and some have even chosen to substitute their entire grey fleet with the proliferation of car sharing stations. Now of course, managing a fleet of vehicles is always easy … until you put the ‘nut’ behind the wheel! Managing driver behaviour is always the harder ‘nut’ to crack. But there are significant gains to be made here, so instead of relegating it to the ‘too-hard’ basket you should see what can be achieved. Implementing a Driving Green policy can have an impact on reducing your emissions as well as your fuel bill.
Drivers of fleet vehicles can be expected to Drive Green at all times to conserve fuel consumption and emissions through a combination of various methods:
•Driving smoothly to avoid unnecessary acceleration.
•Driving at a good distance from the vehicle in front so you can anticipate and travel with the flow of the traffic.
•Minimise fuel wasted when idling by stopping the engine whenever your vehicle is stopped for an extended period of time by switching the engine off, even for a short period, you will save more fuel than is lost from the burst of fuel involved in restarting the engine.
•Better still some models of cars automatically stop the petrol engine when it’s not needed.
•Look after your vehicle’s tyres by inflating your vehicle’s tyres to the highest pressure recommended by the tyre manufacturer and make sure your wheels are properly aligned.
•Looking after your tyres will not only reduce your fuel consumption it will also extend tyre life and improve handling.
•Minimise your vehicle use by thinking about your travel needs prior to your travel. Planned travel will result in fewer trips and more efficient and cheaper travel.
•Speed kills economy with higher speeds resulting in higher fuel consumption.
•Minimise aerodynamic drag. Additional parts on the exterior of the vehicle such as roof racks and spoilers, or having the window open, all increase air resistance and fuel consumption.
•Travel light and don’t carry more people or cargo than you have to. The more a vehicle carries the more fuel it uses.
•Service your vehicle regularly to keep your vehicle well-tuned and you will minimise its environmental impact.
If you are having trouble getting traction with your Drive Green policy, there are technological solutions available to assist with driver behaviour, such as the installation of telematics into your fleet. Some benefits include improved route planning which decrease kilometres travelled saving on fuel, emissions and operating costs. This also leads to increased productivity of your workforce improving timely service to your customers.
Telematics can also help reduce wear and tear on tyres and brakes by providing the data needed to change driver behaviour. Fuel costs can also be lowered by reducing speeding, idling, and unnecessary driving, as well as supporting better engine maintenance.
Reap the rewards
We keep hearing about operating a ‘greener’ fleet, but isn’t there a cost in doing this? Nothing could be further from the truth. It actually costs more if you don’t have a green fleet. By focusing on reducing fleet carbon emissions you will start purchasing more fuel efficient vehicles which means less fuel is needed saving you money. Quite often the technology used in more fuel efficient vehicles has less moving parts so they tend to also be cheaper to maintain and service. Running a more reliable product in your fleet means less down time because of less repairs and maintenance giving you the option of deferring replacement of your fleet by increasing your inventory holding period due to the extended life of your fleet.
While some of these vehicles may initially be more expensive to purchase or lease, the operational savings of these vehicles usually more than offset this initial premium. Not to mention their resale value tends to hold higher than their full petrol counterparts as purchasers in the second hand market are now prepared to also pay a premium for these vehicles as they recognise their ongoing operational benefits and savings. So you need to consider the whole of life costs of these vehicles and benchmark them against your traditional fleet – you will be surprised at the results.
Implementing any or all of these greener fleet strategies will see a real reduction in your fleet’s emissions with a correlating reduction in your fleet operating costs. After minimising your fleet carbon emissions you may choose to offset your remaining emissions by purchasing certified carbon offsets with some of your operational savings. There are numerous Carbon Offset Programs now available in the marketplace, including local plantings of native trees to absorb the greenhouse gas emissions produced by your motor vehicles. You can also use the greening of your fleet to promote your business by highlighting that you are an environmentally conscious organisation and advertise that you have a carbon neutral fleet. This can be a differentiator from other fleets and potentially lead to customer attraction and retention.
There may also be unexpected benefits of operating a greener fleet, such as winning environmental awards. The Australasian Fleet Management Association holds its annual Fleet Awards, including their Fleet Environment Award for outstanding achievement in running a green fleet as part of a sustainability fleet policy. Winning such an award can bring many benefits such as positive national and local media coverage.
We all have a part to play in looking after the earth so future generations can enjoy it. Fleet Managers are in a privileged position to make a positive difference through their purchasing and operating decisions. The easiest way is by greening their fleets to reduce the overall carbon emissions of the transport sector. The added benefit is that reducing your carbon emissions reduces your use of energy and operating costs, making your fleet more profitable. And we would all do well to buck the recent trend recorded at Cape Grim.
Uniting Communities reduced its carbon emissions by 34% over four years and now saves many hundreds of thousands of dollars every year by being more energy efficient using less resources. Uniting Communities is the first South Australian organisation and first registered Australian Charity to become carbon neutral in accordance with the Federal Government’s National Carbon Offset Standard (NCOS).
To find out more, Uniting Communities Carbon Neutral Public Disclosure Statement is available here: https://www.environment.gov.au/climate-change/carbon-neutral/carbon-neutral-program/accredited-businesses/uniting-communities