Businesses have long been interested in sustainability and spoken of their commitment to renewable energy. More recently, there has been an increase in clients establishing quite precise, science-based targets for net zero emissions by 2050. That’s because a range of stakeholders are asking for details around the calculation of their targets and the steps being taken to achieve them.
Another source of emissions
Using renewable energy for your business’ electricity needs is an obvious way to reduce emissions. It isn’t the only path though. Transport – road, rail, domestic aviation and domestic shipping – is Australia’s third-largest greenhouse gas emissions source, accounting for more than 18% of annual emissions.
Australia’s per capita transport emissions are 45% above the OECD average. This reflects the use of cars with high emissions (Australia is the only country in the OECD that hasn’t mandated emissions standards for cars/heavy vehicles) and over-reliance on road freight.
Your opportunity – electric vehicles
Electric vehicles can allow companies to reduce their fuel costs and meet their net zero emissions targets. Electric vehicles can eliminate emissions if charged using renewable energy.
Yet as of June 2020, electric vehicles only made up 0.2% of Australia’s total vehicle fleet (versus 11% in Norway, almost 2% in the Netherlands and 1% in China). In a survey of 177 organisations published by the Australian Fleet Management Association, only a third of respondents operated electric vehicles in their fleet, and these represented just 3% of the survey’s fleet size in both the car and SUV categories.
Realising the electric vehicle opportunity
Our approach to net zero emission plans starts with goal setting. An important part of setting goals is identifying targets for scope 1, scope 2 and scope 3 emissions. Transport typically falls into our clients’ scope 1 emissions, while electricity purchases are reported as scope 2 emissions. You can download a copy of our interactive Net Zero plan here.
One thing to be aware of when incorporating electric vehicles into net zero emission plans is how on-site charging of the vehicles impacts your energy demand profile. This will inform demand decisions and influence the interplay between renewables and traditional energy sources. Should a business be powering a more extensive electric vehicle fleet, demand for energy can go up considerably, leading to higher electricity rates in the future. Therefore, this change in energy demand must be carefully navigated.
The next step can be as simple as committing to migrating the fleet to electric as each vehicle comes due for renewal. Businesses don’t necessarily need to be completely off-the-grid and self-sufficient in electricity generation to overhaul their fleet to electric vehicles. If deciding to do so, do keep in mind the impact of vehicle charging on your energy demand profile. This is an area where we can provide support.
If you need assistance in developing and implementing your plans to achieve net zero emissions, please contact us on 1300 964 589 or contact your accounts manager.