One of the best things about getting back to the office after a week of travel is having a full mailbox. Not the electronic kind – which must still be managed from the road; but the old-school one for, you know, actual mail. Greeting me the other morning was my weekly edition of Transport Topics. It has a great overview of the fuel efficiency efforts of Walmart.
The effort of the company’s logistics group has been widely reported. What jumped out at me in this article was how Walmart evolved in its focus in greening its freight.
Walmart has a goal to double its fleet efficiency by 2015. It defines fleet efficiency by cases delivered per gallon of fuel consumed in its direct fleet. It’s a solid metric and one that works well for the company. As the Transport Tropics article reminded me, though, the company’s original goal was framed differently.
“When the goal was first announced (in 2005), Wal-Mart set a goal of doubling fuel efficiency of its trucks to 13 mpg in 2015 from 6.5 mpg. Several years later, the company adopted a broader measure of efficiency.”
I didn’t remember the framing of the original goal – frankly all of 2005 is pretty hazy to me and most of Red Sox Nation. So, I sought a second source that confirmed the accuracy of the Transport Topics article.
Walmart made the right decision changing its metric. It is much more meaningful to look at the fuel productivity of their direct logistics system than to look at the MPG achieved by their trucks. Driving empty trucks a lot of miles can do wonders for MPG numbers, but it’s a terrible waste of fuel and emissions.
As I’ve written before, when it comes to reducing freight emissions it's not just about the trucks, but we can't do it without efficient trucks, either. Equally important to having efficient trucks is using them smartly. Elizabeth Fretheim, Walmart's director of business strategy and sustainability, made this point too in a recent Inbound Logistics article:
"Within the transportation function, for example, we want to accomplish three goals: fill every trailer to capacity; drive those trailers the fewest miles possible; and use the most efficient equipment."
Companies have a lot of power when it comes to filling every trailer to capacity and driving them the fewest miles possible — two of EDF’s Five Principles for Greener Freight. And while they have a responsibility to use the most efficient equipment too, no one fleet — not even one as large as Walmart — has the market power to push truck makers to bring more efficient trucks to market.
Walmart has done an admirable job demonstrating and deploying available truck fuel efficiency improvement opportunities. According to the Transport Topics article, “the fuel economy of the trucks in its private fleet improved between 15% and 20% since 2005.” Among the actions the company took to achieve this were:
- installing APUs on all trucks that made overnight trips
- using nitrogen in its tires;
- reducing weight and improving aerodynamics of its tractors; and
- upfitting 13,000 of its trailers with aerodynamic side skirts — which is about 20% of its total trailer fleet
But, getting to the 13 mpg will take a lot more than this. It’s not far-fetched, however, for what is currently technologically possible. Reaching this goal will require the entire truck industry — including the manufacturers, fleet operators, and cargo shippers — to work together. And it will get there much sooner with a strong federal truck efficiency and greenhouse gas standard.
A 2010 report by the U.S. National Academy of Sciences demonstrated that there were many opportunities to improve truck efficiency, such as more efficient engines, aerodynamic improvements to tractors and trailers; lighter-weight materials; and smarter transmissions. Through the Department of Energy's Super Truck program, companies including, Cummins and Peterbilt, are demonstrating that 10+ mpg trucks are in reach today.
Barriers remain to moving these technologies from the test track to the assembly line. Manufacturers need to be confident in market demand in order to develop and launch efficiency improvements. Fleets often have to trade off a bit of additional capital upfront in order to gain savings over the operating life of the truck. Walmart experienced some of these barriers first hand after it set its initial 13 mpg fuel efficiency goal. ICCT explored these barriers in depth and found that well designed federal standards can foster the innovation necessary to bring more efficient and lower emitting trucks to market
"truck efficiency standards can break down these barriers by providing investment certainty to technology developers, ensuring fleets have greater technology availability to choose from at the time of purchase, and providing standardized certification information about the efficiency performance of various engines and truck offerings."
President Obama included strengthening truck efficiency standards in his Climate Action Plan. This standard is expected to go into effect after 2018. Recent analysis by ACEEE found that it’s realistic for these standards to be set high enough to achieve nearly a 40% fuel consumption reduction compared to 2010 trucks. ACEEE analysts calculated that this would "yield more than 800,000 barrels of oil savings per day" beyond current standards.
A strong truck efficiency standard will help companies like Walmart that desire more fuel efficient trucks. A strong truck efficiency rule will help us as consumers, by reducing fuel costs – which are the largest cost of owning or operating a freight truck. And, as large trucks are the source of nearly 400 million tons of climate pollution each year, a strong rule will achieve meaningful emission reductions.
Companies looking to green their freight practices can learn a lot from Walmart's activities of the past eight years. Here are the lessons I found:
- Goals matter.
- Performance based metrics should reflect the impact that you can control (such as emissions per ton-mile).
- Simple actions — such as filling every trailer to capacity and driving those trailers the fewest miles possible — can be the most impactful.
- Push the technology envelope by using the most efficient equipment and running pilots where you can.
And, perhaps the most important lesson of all, remember you can't do it all on your own.
Achieving a sustainable freight network will require better trucks, too. To get those on the road at scale, we need bold federal leadership.