New data from retail giant Amazon shows that its carbon footprint grew nearly one fifth (19%) to 60.64m metric tonnes in 2020 as online retail boomed during the Covid-19 pandemic. The rise made 2020 the third consecutive year in which carbon emissions at Amazon have risen since it began recording and releasing data in 2018.

The 19% rise in carbon emissions came as Amazon experienced another year of rapid growth. Revenue across the business grew to $386bn, a rise of 37.6% year-on-year, while in the Online Stores and Third-Party Seller segments, revenues were up 39.7% and 49.6% during 2020 as e-commerce channels became the go-to amid store closures and stay-at-home orders.

In releasing data covering its environmental impact, Amazon pointed to a number of initiatives that helped it lower emissions per dollar of revenue. That figure fell 16% as overall emissions related to visits to its Whole Foods outlets falling 32%, it purchased more solar-generated energy across its business and upped its usage of recycled plastics in its products. However, Amazon’s emissions related to fossil fuels usage rose 69% in 2020.

Amazon, though, is by no means the only player in e-commerce that is struggling to get a handle on its carbon emissions as online retail booms. In the UK, light commercial vehicle sales hit near-record levels in the first half of 2021, with 191,500 sold, according to SMMT data. The peak was set in H1 2019, illustrating that demand is not new, and combined with the new rapid growth in sales, shows it’s likely to endure. Moreover, the sales figures point to further growth in the UK’s emissions from light duty vehicles which rose from 16.1m metric tonnes in 2010 to 19.2m in 2019, according to the latest UK government data.

There is encouraging news about the ability of the logistics market to create more sustainable supply chains, however. A white paper from DHL, “ECO-mmerce: How online retail can build the sustainable supply chain of tomorrow” from June 2021 showed that a majority (60%) of US consumers surveyed were willing to pay more for environmentally friendly products and services, while “54% stated they put more trust in a company based on public commitments to environmental sustainability with carbon emissions, green energy, waste, alternative fuels and sustainable packaging identified as the five most important factors in helping the environment.”

In sum, the evidence shows the status quo in e-commerce logistics is unsustainable. The growth of volumes remains so rapid that it is outpacing the gains in efficiency made by players throughout the e-commerce supply chain. News that consumers are increasingly willing to pay more for sustainable solutions is welcome, now those solutions must be created and embedded.

Source: Foundation for Future Supply Chain, July 7, 2021

Author: Nick Bailey

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