UPS released its annual Sustainability Report announcing that while the total number of packages shipped in 2012 increased, the company reduced its total Greenhouse Gas (GHG) emissions. Environmental achievements included ground and air fuel savings, increased investments in alternative fuel vehicles, and retooled routes that shaved 12.1 million miles from ground deliveries.
UPS also set a new alternative fuel goal of one billion cumulative miles (from a baseline of the year 2000) driven by alternative fuel/advanced technology vehicles by 2017, said David Abney, UPS Chief Operating Officer—more than double the previous goal of 400 million miles. Through the end of 2012, UPS has logged 295 million cumulative alternative fuel miles.
UPS tracks the carbon intensity for ground transportation in the US Domestic Package segment—its largest segment by volume—by ground packages per gallon of fuel. Fuel consumption includes delivery vehicles; feeder vehicles that travel between distribution hubs; and third-party transportation used for transportation by rail and for package delivery (including the US Postal Service, which handles a small percentage of UPS package volume).
In 2012, UPS increased the number of ground packages per gallon of fuel to 8.85 (its fourth straight year of increase). While package volume rose 2.7% for the segment in 2012, fuel consumption rose only 0.3%.
One of the cornerstones of UPS’ environmental strategy is to support the development and use of lower-emission alternative fuels. Vehicles represent approximately 35% of UPS’ carbon footprint; accordingly the company is accelerating its testing, purchase and deployment of new-generation vehicles. Between 2000 and the end of 2012, the alternative fuel/advanced technology fleet has logged 295 million miles; in 2012, this growing fleet drove 49 million miles, a 43% increase compared to 2011.
In 2012, UPS helped launch a working group managed by BSR to advance the development of alternative fuels. Participants include academics, corporations, NGOs, and environmentalists. The first result of the process is a publicly available report entitled The Sustainability Impact of Fuels, which focuses on understanding the total sustainability impacts of commercial transportation fuels, including full lifecycle analysis.
Earlier this year, UPS announced plans to add nearly 1,000 liquefied natural gas (LNG) tractors in the next two years, expanding its current fleet of 2,700 alternative fuel and technologically advanced vehicles. The fleet today includes all-electric, electric hybrids, hydraulic hybrids, natural gas (LNG, compressed natural gas), propane, biomethane, and light-weight fuel-saving composite body vehicles.
The new Sustainability Report also cites the greenhouse gas reductions, fuel savings and miles avoided through the innovative use of technology. For example, UPS’ proprietary telematics system gathers data on more than 200 performance variables for vehicles and drivers, to help reduce the miles driven per package handled. Telematics data fed through vehicle sensors helped UPS cut more than 206 million minutes of engine idling time last year, saving more than 1.5 million gallons of fuel. Routing technology increased pickup and delivery stops per mile, saving 12.1 million miles of driving which equates to approximately 1.3 million gallons of fuel.
UPS had 2,688 alternative fuel/advanced technology vehicles in operation in ten countries at the end of 2012.
Also notable: UPS Airlines, which represents 57% of UPS’ carbon footprint, reduced its fuel use and carbon production. Air shipping volume rose 4.8% year over year, while fuel use dropped 1.3%.
The primary metric for the carbon intensity of UPS Airlines is CO2 pounds emitted per available ton mile (CO2 lbs/ATM), using nautical miles. An available ton mile is a unit that combines cargo weight and distance carried. The company’s long-term goal for this metric is a 20% reduction from the 2005 baseline. (This represents a 42% reduction from 1990.)
In 2010, UPS Airlines carbon intensity was 1.39 CO2 lbs/ATM; this increased to 1.41 in 2011, and was back down to 1.40 in 2012. Results for both 2011 and 2012 were strongly affected by the loss of a 747-400 cargo aircraft due to fire in the third quarter of 2010. This event has had a ripple effect, UPS explained, requiring it to reroute numerous other aircraft around the world in order to meet customer commitments. Other aircraft do not offer the emissions efficiency of the 747- 400, and the lost aircraft has not been replaced. UPS is planning to retrofit its 767 fleet with winglets this year and next to help offset the impact.
Other highlights of the 2012 report include:
Reduction in the absolute amount of global greenhouse gas emissions from operations and purchased energy of 2.1% compared to 2011.
Rapid expansion of UPS’ dedicated global healthcare infrastructure to more than 6 million square feet (0.557 million m2).
A Global Forestry Initiative to plant more than 1 million trees by the end of 2013.
Humanitarian relief efforts in 35 countries, with related in-kind donations valued at US$2.6 million.
Total charitable contributions and United Way donations of US$97.5 million, up from 2011 by US$4 million.
1.8 million volunteer hours donated by UPS employees, friends and families, a new record
For the second year in a row, UPS earned superior credentials for reporting transparency: A Sustainability Report that fulfills the Global Reporting Initiative’s requirements for an A+ level as well as third-party assurance of its report and greenhouse gas data from Deloitte & Touche LLP. Less than 20% of all GRI Sustainability Reports are A+.