Looking back to go forward – Encirc’s intermodal future
Head of Corporate Affairs at Encirc, Oliver Harry explains how the company is unlocking sustainable value in the supply chain
Like the majority of businesses, a large portion of our carbon footprint is in our value chain, which includes our supply chain of materials before they arrive at our sites and then emissions from products once they leave the factory. These emissions are known as Scope 3 emissions, and they’re much harder to reduce than those coming directly from the manufacturing process, because they occur away from Encirc facilities and in conjunction with a number of different partners and industries.
But if we’re going to hit our emissions targets (Vidrala is aiming to reduce its Scope 1 and 2 greenhouse gas emissions by 47% and its Scope 3 emissions by 28% by 2030) and help the UK and EU reach net zero by 2050, we can’t let these emissions go unchecked. Sustainability concerns aren’t the only thing causing businesses to re-think their value chains – volatile fuel prices, global lockdowns, and geopolitical shocks have illustrated the need for change in boardrooms and on balance sheets.
Overall, the message is that it’s time to do things differently, whether that’s for the sake of sustainability or security. At Encirc, we’re overhauling how we move our products, and that includes taking a lesson or two from history and welcoming back the intermodal transport systems that were common when global supply chains were first getting off the ground.
Back on track
It was intermodal transport that gave birth to the now universally recognised symbol of the supply chain, the shipping container, as an easier way of moving goods from different forms of transport in the 1950s. Now the shipping container is the world’s most popular box, but its potential to enable intermodal transport and decarbonise supply chains is going largely untapped.
The underutilisation of rail in UK industry is a prime example of this. Each tonne of freight transported by rail produces 76% fewer carbon emissions compared with road transportation, making it a no brainer, right? This has been the approach for industry big hitters in Europe and the United States such as IKEA and Amazon, who have already seen huge reductions when transitioning away from road transport.
The challenge in the UK is a different one – freight is moving across smaller distances and must still cover the ‘last mile’ where road transport is unavoidable. But the attitude too often is still that if any of the journey must be on the road then the whole journey has to be. This is what we’re working to change at Encirc.
Having completed successful trials using the railhead at our site in Cheshire, we’re now working with beverage manufacturers to move products to local filling sites, packagers, and distribution hubs by rail, keeping them off the road for as long as possible, reducing not just our emission but also those of our partners.
We have so much to gain from embracing intermodal transport in the UK, so we shouldn’t let the last mile rule the rest of them.
Thinking inside the box
Going off-road isn’t the only change that the beverage industry can make to its supply chain for the sake of sustainability – we also need to look inside the containers that we’re shipping and make the most of that space.
It’s here that innovations such as bulk shipping are driving efficiency up and emissions down. By shipping liquid in bulk, as opposed to in bottles, removes huge amounts of previously dead space in containers, reduces the weight of containers, and saves on emissions.
Our recent project in collaboration with environmental consultants Accenture found that making the switch to local bottling cut the transport carbon footprint by an average of 42%, so no drop in the ocean. Importantly, this isn’t a change which means pulling apart our value chain and then starting again; it’s an immediate and significant improvement that we’re making with our partners that comes from not accepting the status quo as the most effective way of working.
Realising our potential
Achieving net zero as an industry, as an economy, and as society will require everyone to pitch in, but it doesn’t have to mean sacrifice or wholesale transformation, at least not everywhere.
While we work towards solutions for some of the other big questions, such as fuel and waste, we can’t afford to pass up opportunities for positive change within what we’re already doing, and unlocking the sustainable value in our value chain is a real success story.