Part 2: The European Green Deal & Logistics.
On July 14, 2021, the European Commission, led by climate commissioner Frans Timmermans, presents the European Green Deal (EGD). To ensure the implementation, the European Commission adopts the Fit for 55. In 2023, everyone is looking at the European Commission to release the final version of the Corporate Sustainability Reporting Directive (CSRD). ‘What does all of this mean for me?’ many wonder. We take these legislations and reporting frameworks apart and explain what this means for Logistics in this series of articles.
The European Green Deal and its objectives within the logistics sector
One of the key objectives of the European Green Deal (EGD) is to transform the logistics sector into a more sustainable and environmentally friendly industry. The logistics sector is responsible for a significant amount of carbon emissions. Primarily, this is due to the reliance on fossil fuel-powered vehicles and inefficient supply chain practices.
To achieve this objective, the EGD proposes a range of measures and policies aimed at reducing emissions and promoting sustainability within the logistics sector. Some of these measures include:
- Promoting sustainable transport modes. The EGD aims to promote the use of sustainable transport modes such as electric vehicles, bicycles, and public transport. This will help to reduce the carbon footprint of the logistics sector and improve air quality in urban areas.
- Encouraging the use of alternative fuels. The EGD also aims to encourage the use of alternative fuels such as biofuels, hydrogen, and synthetic fuels. This will help to reduce the dependence on fossil fuels and promote a more sustainable energy mix.
- Improving logistics efficiancy. The EGD proposes to improve logistics efficiency by promoting the use of digital technologies and implementing sustainable supply chain practices. This will help to reduce the environmental impact of logistics activities and improve overall sustainability.
- Supporting the circular economy. The EGD also aims to support the transition to a circular economy by promoting the reuse and recycling of materials and products. This will help to reduce waste and promote sustainable production and consumption.
‘Will these measures affect me?’ you may wonder. Looking at the Emissions Trading Scheme and the upcoming CSRD the answer is probably yes. So, what is the Emissions Trading Scheme?
The European Green Deal and the Emissions Trading Scheme (ETS)
The ETS is a cap-and-trade system that aims to reduce greenhouse gas emissions by placing a price on carbon. The EGD and the ETS are closely related. While the EGD includes a range of measures to reduce greenhouse gas emissions, the ETS is one of the key policy instruments that will be used to achieve these objectives.
The European Commission has proposed several changes to the ETS as part of the EGD. These include a more ambitious emissions reduction target, the inclusion of new sectors such as shipping and aviation, and the introduction of a carbon border adjustment mechanism.
The EGD also includes measures to promote the transition to a low-carbon economy, such as investing in renewable energy and energy efficiency, promoting sustainable transport, and supporting the development of new technologies. The ETS can play a key role in driving this transition by creating a financial incentive for covered entities to reduce their emissions and invest in cleaner technologies.
The transition to low-carbon Logistics requires investment and collaboration
Overall, the European Green Deal represents a significant opportunity for the logistics sector to transform into a more sustainable and environmentally friendly industry. The proposed measures and policies will not only help to reduce emissions but also improve logistics efficiency and support the transition to a circular economy. The ETS is a key instrument that will be used to achieve these objectives. By placing a price on carbon, the ETS creates a financial incentive for companies to reduce their emissions and invest in cleaner technologies, supporting the transition to a low-carbon economy.
However,the implementation of these measures will require significant investment and collaboration between industry stakeholders, policymakers, and other key actors. It is therefore essential that all stakeholders work together to ensure the success of the European Green Deal and the transformation of the logistics sector to keep our planet healthy for ourselves and future generations.
Collaboration, knowledge exchange and implementing measures that lead to actual carbon emissions reduction are key in the Lean & Green program. Want to find out how the Lean & Green program does that? Curious about how the program aligns with the European Green Deal and Fit For 55? Make sure to keep an eye out for the third article in this series.