Amazon is a US-based multinational company that is involved in the business of eCommerce, cloud computing, digital streaming as well as Artificial Intelligence (AI). Amazon has been committed to sustainability for many years. In 2019, Amazon co-founded The Climate Pledge—a commitment to be net-zero carbon across the business by 2040, 10 years ahead of the Paris Agreement. As part of this pledge, Amazon has made ambitious commitments such as reaching ‘Net zero Carbon’ across its business by 2040, at least 50 per cent of shipping to be Carbon by 2030, 100 per cent use of renewable energy for operations by 2025 and many more. To meet these goals, teams across Amazon are taking a broad, science-based approach to measuring, reducing, and eliminating carbon emissions in its operations.
Let us look at the company’s initiatives in FY2019-20.
1. Climate Pledge Fund
The Climate Pledge was founded in 2019 by Amazon and Global Optimism. The Pledge calls on signatories to be net-zero carbon across their businesses by 2040, a decade ahead of the Paris Agreement goal of 2050. Companies that sign The Climate Pledge agree to:
Signatories agree to measure and report greenhouse gas emissions on a regular basis.
Signatories will implement decarbonization strategies in line with the Paris Agreement through real business change and innovations, including efficiency improvements, renewable energy, materials reductions, and other carbon emission elimination strategies.
Signatories must take actions to neutralize any remaining emissions with additional, quantifiable, real, permanent, and socially-beneficial offsets to achieve net zero annual carbon emissions by 2040.
In June 2020, Amazon announced The Climate Pledge Fund to support the development of sustainable and decarbonizing technologies and services that will enable Amazon and other companies to meet the goals set by The Climate Pledge. This dedicated investment program—with an initial $2 billion in funding—will invest in visionary companies whose products and solutions will facilitate the transition to a low carbon economy.
In order to meaningfully reduce the amount of net greenhouse gas emissions, low-carbon solutions need to be developed in all sectors of the global economy. The Climate Pledge Fund will invest in companies in multiple industries, with an initial focus on: transportation and logistics; energy generation, storage, and utilization; manufacturing and materials; circular economy; and food and agriculture. Companies of all sizes and stages will be considered, from pre-product startups to well-established enterprises looking to scale. The scope of The Climate Pledge Fund is global and will consider investments in companies developing products or services that reduce carbon emissions and help preserve the natural world.
2. Right Now Climate Fund
Amazon established the Right Now Climate Fund, a $100 million fund to restore and conserve forests, wetlands, and grasslands around the world. Through the Right Now Climate Fund, Amazon is taking immediate action to remove or avoid carbon emissions by supporting nature-based climate solutions. The Company is working with The Nature Conservancy to identify projects around the world that can create real and lasting carbon reductions, while also empowering communities, enhancing natural environments, and protecting wildlife. Some projects being conducted under the initiatives are:
2.1 Family Forest Carbon Program and Forest Carbon Co-ops
In April 2020, Amazon announced the funding of $10 million toward two projects that will help U.S. family forest owners sequester carbon and support expansion across Appalachia and other U.S. regions. Scientists at The Nature Conservancy have identified this network of climate-resilient forests as most able to thrive in the face of climate change. Amazon, The Nature Conservancy, the American Forest Foundation, and the Vermont Land Trust are partnering on two innovative projects—the Family Forest Carbon Program and Forest Carbon Co-ops.
The Family Forest Carbon Program will open up carbon credit markets to small family forest owners for the first time. Amazon’s commitment will expand the program in the Appalachians and other U.S. regions and go towards designing new methods for measuring and verifying reforestation and forest management practices. The Forest Carbon Co-op will help owners of mid-sized forests use sustainable forest management and protection measures to earn income through the carbon credit market. Amazon’s grant will support efforts to expand the program in climate-resilient forests across the Appalachians, develop a scientific approach to regional carbon impact measurement, and enhance the project verification methodology. Amazon is the largest funder of these programs and will help:
– Conserve and sustainably manage forest land and wildlife in the Appalachian region, with plans to expand the projects across 4 million acres of the 2,000-mile span of the Appalachians, and beyond.
– Generate economic opportunities by creating a new source of income for family forest owners and rural communities that taps into the carbon storage potential of forests. In the U.S., families and individuals own the largest portion of forests (38%)—more than the federal government or corporations.
– Achieve a net reduction of up to 18.5 million metric tons of CO2 in the atmosphere by 2031—the equivalent of the emissions of nearly 4 million U.S. cars in a year.
2.2 Urban Greening in Germany
Amazon is supporting The Nature Conservancy in an effort to reduce climate change risks and increase species biodiversity in three German cities. The initial project is in Berlin’s Charlottenburg-Wilmersdorf district. Learnings will be applied in two other German locations, and then shared across other European cities. With this, Amazon is recognizing the urgency of the climate crisis and its impacts on urban communities.
Amazon’s commitment will fund The Nature Conservancy’s Urban Greening program, which uses nature-based solutions to help cities become more climate-change resilient. The program will collaborate with city officials and local community organizations to create and implement plans for:
– Reducing flood risk by improving rainwater retention through tree planting, revitalizing urban wetlands, and adapting existing green spaces;
– Reducing extreme heat and pollution by leveraging unused public spaces to plant trees and improving urban water bodies;
– Increasing urban biodiversity by introducing pollinator-friendly species, climate-resilient plants, and urban grasslands.
The program starts in the Charlottenburg-Wilmersdorf district of Berlin and uses a science-based, municipality-wide, and stakeholder-based approach to urban greening to ensure that projects are complementing existing local efforts. Two additional German cities will be chosen, in which the initial learnings from Charlottenburg-Wilmersdorf will be applied. The goal is to share a guide to urban greening with municipalities across Europe by the end of the five-year project
3. Carbon Footprint
Amazon’s corporate carbon footprint quantifies the total greenhouse gas emissions attributed to its direct and indirect operational activities. The Company measures its total impact on the climate, map the largest activities contributing to this impact, and use this information to develop meaningful carbon reduction goals, including its overall goal to reach net-zero carbon across Amazon by 2040.
Through its commitment to The Climate Pledge, Amazon is investing in a range of large-scale solutions to decarbonize its business, some with immediate carbon savings and others with longer-term payoffs. The Company has already seen an improvement in the carbon intensity of its business in 2019 as a result of operational efficiencies such as energy efficiency technologies in fulfilment centres and alternative vehicle pilots.
4. Renewable Energy
Amazon is on a path to powering its operations with 100% renewable energy by 2025 as part of its goal to reach net-zero carbon by 2040. In 2019, the Company reached 42% renewable energy across its business.
Amazon has 127 solar and wind projects across the globe that have the capacity to generate over 6,500 megawatts (MW) and deliver more than 18 million megawatt-hours (MWh) of energy annually. These projects supply renewable energy for Amazon’s corporate offices, fulfilment centres, and Amazon Web Services (AWS) data centres that support millions of customers globally.
In March 2020, Amazon announced four new renewable energy projects—the first in Australia, second in Sweden, second in Spain, and eleventh in the Commonwealth of Virginia in the U.S. The Company announced five new renewable energy projects in China, Australia, and the U.S. in May 2020. In December 2020, Amazon announced plans to add 26 utility-scale wind and solar energy projects, bringing the total investment in renewable energy in 2020 to 35 projects and more than 4 gigawatts (GW) of capacity—the largest corporate investment in renewable energy in a single year. These new projects will make Amazon the largest-ever corporate purchaser of renewable energy.
5. Shipment Zero
Shipment Zero is Amazon’s vision to make all its shipments net-zero carbon, with a goal of delivering 50% of shipments with net-zero carbon by 2030. Shipment Zero means that the fulfilment operations the company undertakes to deliver a customer’s shipment are net zero carbon— from the fulfilment centre where an item is picked off the shelf, to the materials used to package the item, and the mode of transportation that gets the package to the customer’s door. The Company is working to launch Shipment Zero deliveries in Europe and the U.S., followed by India, Japan, and all other geographies where it operates across the globe.
The emissions sources considered in scope for Shipment Zero are:
1. Electricity emissions from powering operations facilities and vehicle charging;
2. Transportation tailpipe emissions from the burning of fossil fuels in vehicles that transport shipments from inventory to the customer;
3. Emissions from manufacturing and transporting the materials used in outbound packaging.
6. Sustainable Transportation
Transportation is a major component of Amazon’s business operations and a key part of its plan to meet net-zero carbon by 2040. Amazon is committed to optimizing and transforming its transportation network through innovations in electrification, efficiency enhancements, and alternative delivery methods.
6.1 Electrifying the Transport Fleets
In 2019, Amazon ordered 100,000 electric delivery vehicles from Rivian, a U.S. electric vehicle manufacturer. This order, the largest order ever of electric delivery vehicles, sends a signal to the marketplace to start inventing and developing new technologies that large, global companies need to transition to a low-carbon economy.
Amazon plans to start using these new vehicles from Rivian to deliver packages to customers by 2021, with 10,000 new vehicles on the road as early as 2022 and all 100,000 vehicles on the road by 2030. This is projected to save millions of metric tons of carbon per year by 2030. Amazon already operates hundreds of electric vehicles across the globe.
Amazon India is adding 10,000 electric delivery vehicles to its existing fleet by 2025, including 3-wheeler and 4-wheeler vehicles designed and manufactured in India. These vehicles are in addition to Amazon’s order of 100,000 electric delivery vehicles from Rivian.
Across Europe, Amazon is contracting with its service providers to launch a low-pollution last-mile fleet comprised of electric and natural gas vans and cars. It has added hundreds of electric vehicle charging stations at the European facilities for its partners to use, with plans to expand this infrastructure to support more sustainable deliveries. Amazon uses electric cargo bikes in cities around the world, including a pilot in New York City in 2019. In North America, Amazon has also deployed electric yard hostlers, which are used to move trailers around facilities.
6.2 Using Alternative Delivery Methods
Amazon is continually piloting new or alternative ideas in different locations around the world in an effort to increase efficiency and reduce emissions. In urban centres like New York City, it delivers packages on foot, has expanded use of traditional bicycles, and use pedal-assist electric bikes connected to cargo trailers that can carry up to 45 packages. In India, the fleet includes electric three-wheelers and compressed natural gas (CNG) vehicles. Electric bikes and CNG vehicles are also part of the delivery fleet in Europe. Additionally, the Company is developing fully electric autonomous delivery services, such as the Amazon Scout device and Prime Air drones, which will make deliveries faster and more efficient than road deliveries.
6.3 Partnering with Experts and Industry
In 2017, Amazon signed the Sustainable Fuel Buyers’ Principles, demonstrating its commitment to working with service providers to accelerate the transition to low-carbon commercial transportation solutions. Members of the nonprofit Business for Social Responsibility (BSR) Future of Fuels group developed The Buyers’ Principles and vetted them through its network of 600 expert and industry stakeholders. These principles outline criteria that will catalyze the partnerships needed to drive the transition to a sustainable road freight transportation system.
Amazon is committed to reducing the environmental footprint through recycling initiatives in operations and for customers. The Compay is developing new recycling infrastructure, inventing recyclable packaging materials, and investing in initiatives that support the recycling industry across the U.S.
Amazon recognises the need of customers for minimizing the amount of waste that ends up in the landfill. To improve curbside recycling in the U.S., it has partnered with The Recycling Partnership, which supports communities and local governments with education, infrastructure, and measurement related to curbside recycling.
The Company has also invested $10 million in the Closed Loop Infrastructure Fund to finance recycling and circular economy infrastructure in North America. Through this investment, Amazon aims to increase product and packaging recycling, ensuring that material gets back into the manufacturing supply chain. Over the next decade, the investment in the Closed Loop Infrastructure Fund will improve curbside recycling for 3 million homes in communities across the U.S., diverting 1 million tons of recyclable material from landfill and eliminating the equivalent of 2 million metric tons of carbon dioxide.
8. Amazon Second Chance
Amazon Second Chance provides information on how to trade in, recycle, or repair products, how to recycle Amazon packaging, and how to find open-box and refurbished devices.
Customers who have eligible items they no longer want can discover the Amazon Trade-In program, which allows them to receive an Amazon.com Gift Card in exchange for thousands of eligible items including Amazon devices, cell phones, video games, and more. In addition, customers wanting to responsibly dispose of their electronics can discover the device recycling program for a variety of electronics and related accessories.
Amazon also gives customers several options to shop for great deals on open-box or gently-used items. Amazon Warehouse —an online store for great deals on quality used products including furniture, toys, instruments, kitchen appliances, clothes, and more—has an extensive inspection process that ensures as many gently-used returned items as possible can be resold rather than being sent to landfill.
Amazon Renewed offers refurbished pre-owned, and open-box products such as computers, laptops, smartphones, tablets, cameras, audio devices, home appliances, and more. And Certified Refurbished and Used Amazon Devices provides customers access to pre-owned Amazon devices such as Echo, Fire Tablets, Kindle E-readers, and more. Certified Refurbished devices have been refurbished, tested, and internally certified by Amazon to look and work like new. All of these programs reduce waste and encourage reuse by ensuring that valuable products can go back into the hands of customers rather than being sent to landfills.
Amazon also encourages customers to fix the things they buy before replacing, returning, or disposing of them. It offers free Product Support (on a select but growing number of items) with the goal of helping customers maximize the useful life of the things they already own. Product Support serves seven global geographies with technical support, parts replacement, and repair services. Helping customers responsibly dispose of Amazon packaging is another key component of Second Chance. Customers are able to view various types of Amazon packaging and are provided with instructions on how and where to dispose of the materials
9. Product Donations
Amazon facilities around the world are continuously expanding initiatives to maximize the positive impact of its surplus inventory. They contribute food and non-food product donations to hundreds of food banks and nonprofits, reducing landfill waste and helping local communities.
Amazon partners with Feeding America and Good360 to donate surplus inventory and distribute products to communities in need across the U.S. In 2019, Amazon and Whole Foods Market donated 37.5 million meals and 200,000 pounds (90,700 kilograms) of household essentials to Feeding America through its donation program. Throughout countries in Europe, the Company collaborates with local food banks and non-food charities to donate products to communities in need. Amazon is a long-term partner of the German nonprofit Innatura, which brokers in-kind donations to charitable organizations. Through this partnership, Amazon has donated to more than 1,500 charities benefiting nearly 500,000 individuals and families in Germany with donations including toys, shoes, clothing, and drugstore items, among others. Amazon works with In Kind Direct, a national charity in the UK that manages the donation of surplus products to charities across the country. Since partnering with In Kind Direct, it has donated more than $8.7 million (£7 million) worth of products. In 2019 alone, Amazon donated $1.2 million (£1 million) to over 2,000 charities and voluntary organizations across the UK.
Amazon is also investing in automated systems that enable third-party sellers to donate their surplus inventory to local charities. This new program has quickly become popular, with 97% of sellers on Amazon in the U.S. opting to donate their surplus inventory. This program also launched in the UK with nine local charity partners and will expand to France by the end of 2020. In the last three months of 2019 alone, third-party sellers donated a combined 3 million products to communities in need through this new automated system.
Disclaimer: This article contains excerpts from the Amazon Sustainability Report 2020.