Supply chains are linked up with the White House’s push to reduce GHG emissions

When President Biden last week announced that the United States is focusing on reducing the nation’s greenhouse gas emissions (GHG) by 50%-to-52% below 2005 levels by 2030, it garnered a lot of attention, as it should.

Along with laying out the GHG emissions-reduction target, Biden stressed that the countries that are taking these steps—and taking decisive action now— “will reap the economic benefits of the future.”

Reducing GHG emissions in half, or slightly more, is good and needed policy, to be sure, but this recent announcement was not the first step. Many may view the White House’s decision in January to re-enter the Paris Climate Agreement as the real first step.

The Paris Climate Agreement requires each of the 197 participating countries to strengthen the global response to the threat of climate change by keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase even further to 1.5 degrees Celsius. It also aims to strengthen the ability of countries to deal with the impacts of climate change.

As for steps taken on the climate front early into the Biden presidency, things are moving at a rapid clip, with the U.S. having rejoined the Paris Agreement, as well as renewing the nation’s focus on climate change, issuing an executive order focused on addressing the climate crisis at home and abroad, while creating good-paying union jobs, building sustainable infrastructure, and delivering environmental justice.

But that is not all that is happening on the sustainability front. Logistics and freight transportation stakeholders have highlighted various steps shippers, carriers, and 3PLs can take to reduce emissions, including focusing on things like route optimization, delivery process improvements and efforts focused on actively taking miles off of the road, and shortening the last mile of the supply chain and eliminating the need for some of these additional vehicles and additional operations in place.

There are more than a few notable initiatives related to green freight and logistics efforts underway, to be sure. In fact, were we not all still focused on things like the ongoing COVID-19 pandemic, a new Presidential Administration, port congestion, a lack of logistics labor, automation and robotics, the last mile logistics and e-commerce supply chain, and the global trade environment, among other topics, it is totally fair to say that the ongoing focus on emissions reduction and “greening” of supply chains could very well be the biggest topic in the supply chain sector today. In fact, it may even be. 

There are more than a few recent examples to back up that assertion, including the following below (I apologize in advance for ones omitted, as there are several):

• FedEx announcing in March it is making a $2 billion investment in order to have carbon-neutral operations by 2040, which it said will be focused on by initial investments in vehicle electrification, sustainable energy, and carbon sequestration;
• Deutsche Post DHL Group also announcing in March its $8 billion (USD) road map focused on what it is called the planned decarbonization of the company, through 2030, focusing on climate-neutral logistics;
• the Association of American Railroads issuing a policy paper focused on safely and effectively combatting climate change; and
• the Environmental Defense Fund issuing a paper presenting the case for what can be done to spur on increased investment in, as well as the adoption of, electric vehicles used for delivery, among others

What happens next on the GHG emissions front remains to be seen, at this point. But one thing that is very clear is that the White House and supply chain stakeholders are on the same page, when it comes to recognizing the importance, and, in some cases, urgency, of this situation. That was something that was not happening all that long ago by the former administration. Here is to hoping progress is made in a timely manner.