We help the world grow more prosperous by providing transportation and logistics solutions that facilitate global trade. This role requires the use of substantial amounts of energy, primarily in the form of fuel and electricity for our vehicles, aircraft, distribution facilities, warehouses, and data centers. In addition to the energy used in our own network operations, we also rely on other third-party transportation providers who use fuel and energy on our behalf to transport goods via all modes of transportation, including air, ocean, road, and rail.
We take a comprehensive, global approach to reducing energy use and GHG emissions within our network, as well as major portions of our value chain, including customers and suppliers.
We believe everyone shares responsibility to improve energy efficiency and to reduce GHG emissions in the atmosphere. UPS supports global efforts to mitigate the impact of climate change. Our Corporate Climate Change Statement is also publicly available on the UPS Pressroom.
Our optimized global logistics network, combined with our global GHG strategy, helps improve our efficiency and reduce our environmental impacts. This strategy includes:
- Setting an ambitious goal to reduce absolute GHG emissions 12 percent by 2025 throughout our global ground operations, with supporting goals for fuel, energy, and alternative vehicles;
- Utilizing operational improvements through technology to create overall network and delivery efficiencies beyond reducing miles/fuel, (e.g., higher trailer utilization, decreased sortation time, increased safety, reduced errors/duplication of work, higher asset utilization/less waste, etc.) that reduce our GHG footprint;
- Expanding our fleet of alternative fuel and advanced technology vehicles, known as our Rolling Laboratory, in order to reduce the proportion of conventional fuels we use;
- Reducing conventional energy use and increasing the use of renewable energy in our facilities;
- Providing customers with services that help them reduce their environmental impact; and
- Helping increase supplier awareness about GHG emissions and how to reduce them.
We also contribute actively to public discussions about environmental sustainability. This includes collaborating with leading NGOs, regulators, and industry consortiums to propel the cause of environmental sustainability forward. We also participate in public policy forums, where we advocate for prudent innovation and investment in new technologies and infrastructure development.
UPS measures the effectiveness of our energy and greenhouse gas emission strategy by tracking progress toward a set of 2020 and 2025 goals established in 2016:
Goal: Reduce Absolute GHG Emissions 12 Percent Across Global Ground Operations by 2025In 2016, we committed to reducing absolute GHG emissions 12 percent across our global ground operations by 2025 (2015 baseline). In 2019, absolute emissions decreased 0.8 percent over 2018 performance; however, total emissions remain 5.4 percent above the 2015 baseline. When we set this goal, we expected to face headwinds due to e-commerce growth, which is driving a need for an increased level of residential package deliveries, as well as growth in the total number of shipments we complete. The e-commerce boom has also changed buyer behavior: consumers have become accustomed to getting nearly anything they want when they want it, which is driving demand for faster shipping. We have invested in operating capacity across our network to accommodate this volume growth, including network planning tools and technologies, as well as fleet expansion and facility automation, which, despite requiring more energy, help improve efficiencies across the network.
The key pathway to achieving this goal is to spur the use of renewable energy across our fleet and facilities, so we set supporting targets to source more alternative fuels and to expand our fleet of alternative fuel and advanced technology vehicles. We remain committed to this goal and are confident that recent investments in lower-emission vehicles and renewable fuels, as well as recent solar deployments, will accelerate our progress in the coming years.
We also continue to report on our GHG intensity goal, using the Transportation Intensity Index (TII) referenced below, which was introduced in 2010. Our goal is to reduce overall carbon intensity 20 percent by 2020 (2007 baseline). This Index captures the overall efficiency of our global network by measuring GHG emissions associated with transporting packages and freight for our customers in a given year. Separate carbon intensity metrics measuring the Scope 1 and Scope 2 CO2e emissions for each of our three business segments are included in this Index. As of 2019, UPS has realized an overall carbon intensity reduction of 19 percent. This decrease comprises a 19.5 percent absolute emissions reduction within our U.S. small package business segment, a 12.8 percent reduction attributable to our global airline, and a 32.1 percent reduction within our U.S. supply chain and freight segment.
Goal: Increase Electricity From Renewable Sources to 25 Percent by 2025In 2019, we completed a 10MW deployment of rooftop solar arrays on facilities in New Jersey, Connecticut, and Massachusetts, and began procuring renewable electricity for more than 30 UPS facilities in Virginia. UPS operations in 10 European countries are now achieving near-zero emissions through the use of renewable electricity. These investments have generated a modest improvement over 2018, with 3.9 percent of our total electricity needs generated from renewable sources; however, there’s more work to do to reach our 2025 goal.
Even as package volume increases, we must further slow the growth of energy use in our facilities. In 2020, we will deploy additional solar arrays across select facilities and plan to explore other renewable electricity solutions that are feasible from an environmental and economic perspective, including additional purchases of renewable electricity.
Goal: Increase Use of Alternative Fuel to 40 Percent of Total Ground Fuel by 2025The use of alternative and renewable fuels is critical to achieving our goal to reduce absolute GHG emissions. In 2019, we continued investing in alternative fuels for our ground fleet, purchasing 135 million gallons of alternative fuels, which represents 24 percent of our total ground fuel usage.
We also committed to purchase 250 million gallons of renewable natural gas (RNG) over the next several years, including the largest-ever U.S. investment in RNG. As UPS continues to increase the percentage of alternative fuel and advanced technology vehicles compared to petrol and diesel powered vehicles in our overall fleet, we expect to continue to be a leader in the purchase of alternative fuels. UPS is roughly halfway toward our 2025 goal in this area.
Goal: In 2020, 25 Percent of Total Vehicles Purchased Are Alternative Fuel & Advanced Technology VehiclesUPS’s fleet of more than 10,300 alternative fuel and advanced technology vehicles includes all-electric, hybrid electric, hydraulic hybrid, ethanol, compressed natural gas (CNG), liquefied natural gas (LNG), RNG, biodiesel, and propane vehicles. In 2019, we continued expanding this specialized fleet; however, year-over-year investments slowed to 4 percent of new vehicles purchased. Nevertheless, we are on track to achieve this goal by the target date, driven by the 2019 commitment to purchase 6,000 natural gas-powered vehicles and planned vehicle purchases in the next three years. In Q1 2020, we also announced a significant investment in the U.K.-based startup Arrival, which will expand our fleet to include an additional 10,000 all-electric vehicles.