Amazon finally decouples emissions from business growth

Image: Amazon.

The e-commerce giant has today revealed an emissions drop of 0.4% across all scopes, despite growing sales by 9%.

The drop is small but it bears noting that, between 2021 and 2022, Amazon recorded an 18% increase in emissions and stated it was challenging to decouple emissions growth from business growth.

Several key projects have contributed to the milestone, which was posted in Amazon’s latest global sustainability report. Chief among them are efforts to decarbonise energy; Amazon posted a 29% drop in Scope 2 (power-related) emissions.

The report reveals that Amazon is now using renewables to meet 90% of its electricity needs, up from 85% in 2021. It remains the world’s largest corporate purchaser of renewable energy.

It has also invested significantly in energy efficiency measures for its buildings, including fitting energy-efficient lighting and cooling systems.

All new Amazon buildings will be electric-first and will not be connected to gas heating. For existing buildings, retrofit programmes are underway in both the US and Europe. There is a focus on food retail in the first instance, replacing water heaters, kitchen equipment and HVAC systems at ‘Fresh’ and ‘Amazon Go’ outlets.

Embodied carbon in buildings has also been an increasing area of focus. The report outlines how Amazon is investing in lower-carbon building material innovations including concrete, while convening business units to update baseline building design standards to specify lower-impact construction approaches.

Fleet transition

Amazon’s decarbonisation this past year is also attributable, in part, to efforts to transition its fleet of road vehicles.

The company now has more than 9,000 electric vehicles (EVs) in its global delivery fleet, with plans to accelerate deployment significantly in the coming months. In India, for example, it wants to operate 10,000 EVs by 2025, up from around 3,800 at present.

Amazon is notably moving some of its delivery capacity for road vehicles in-house and scaling back the use of third-party logistics providers. This gives the company more direct control over its road transport decarbonisation approach.

Most of Amazon’s EVs currently operate in the US and Europe and most are vans. It confirmed the deployment of the first 300 custom-built Rivian EVs in Europe earlier this month, serving major German cities.

Amazon is also investing in electric heavy goods vehicles, starting in Europe, as this technology finally becomes commercially available. Additionally, it has chosen to transition its forklift fleet to green hydrogen in the US.

Supplier focus  

Like most large multinationals, the bulk of Amazon’s emissions footprint lies in Scope 3 categories (indirect emissions). Its Scope 3 emissions are more than three times greater than Scopes 1 and 2 combined.

The majority of Amazon’s Scope 3 emissions occur upstream in the supply chain. As such, the retailer is planning a new programme to engage suppliers with decarbonisation. From 2024, all new and existing suppliers will need to set climate targets and report progress to Amazon annually.

This approach will be used, in time, to ensure suppliers are aligned with the retailer’s net-zero goal for 2040. The report states that “operational changes” in the supply chain are absolutely necessary to “further drive down emissions”.

Amazon’s VP for worldwide sustainability Kara Hurst said: “Amazon has one of the largest value chains in the world. As we know [that] the first step in reducing emissions is to understand them, we will continue to work directly with our suppliers, and, starting next year, will update our Supply Chain Standards to require regular reporting and emissions goal setting.

“We’ll also use our scale, investment and innovation to date to provide our suppliers with products and tools that will help them reach their goals—whether those are transitioning to renewable energy or increasing access to sustainable materials.”

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