CO2 neutrality with photovoltaics – Learning from Amazon Logistics – CO2 neutrality with photovoltaics – Learning from Amazon Logistics

Published on: August 17, 2020 / Update from: September 14, 2021 - Author: Konrad Wolfenstein

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In intralogistics, logistics, mechanical engineering and the manufacturing industry

CO2 neutrality with photovoltaics – Photo: Wetzkaz Graphics|shutterstock

Some people see the European Climate Law (European Green Deal) as another attempt by the EU to patronize or even control its citizens. However, few people know that this is actually about planning security and transparency for industry and investors in order to ensure a green growth strategy. It is an ambitious goal of the EU to become the first climate-neutral continent in the world by 2050.

But there is another way and there are other reasons that are worth thinking about. , shipping and fulfillment costs have skyrocketed over the last ten years : total logistics costs between 2009 and 2019 had increased more than 20 times.

• Last year alone, the company's shipping costs were $37.9 billion.
• Fulfillment costs (e.g. costs of operating and staffing fulfillment centers) add another $40.2 billion to a hefty logistics bill.
• Although Amazon's revenue has also increased more than 10-fold since 2009, that wasn't enough to offset the increase in logistics costs.
  In 2009, shipping and fulfillment costs amounted to 15.6 percent of net sales. By 2019, this share had risen to 27.9 percent.

Competitiveness and conquering market shares come at a price. Therefore, Amazon leaves nothing to chance. Not only is Amazon the leader in research spending , it is also investing in the expansion of its robotics . Not only is robotics faster and more powerful, it is also less error-prone and more reliable. The idea behind it : The higher the share of automation through robotics, the lower the share of its personnel costs and the lower the advantages of cheaply available labor.

Amazon is investing hugely in research and robotics – Photo: Mike Mareen|shutterstock

Amazon has also made impressive progress in the area of ​​photovoltaics, in just five years . A 45 MW solar farm will be completed in Virginia this year and is expected to deliver 100,000 megawatts of clean electricity annually. Solar farms are currently planned in Seville (Spain) with 149 MW, in Lee County, Illinois (100 MW) and in Northern Virginia (80 MW).

In the US, Amazon ranked first in 2018 for the number of solar systems installed and second for the total number of solar systems installed to date.

Amazon now has 70 renewable energy projects worldwide (21 wind and solar farms and 50 solar systems on logistics centers), with an estimated total capacity of 1,900 MW, providing 5.3 million megawatt hours (MWH) of climate-neutral electricity annually.

Those are impressive numbers! But it shows once again that Amazon is committed to expanding its market dominance in the future

• Robotics and
• automation

on

• Autonomous power supply (CO2 neutrality)

puts.

here is not on green intralogistics , sustainability, CO2 reduction and decarbonization - it is an important and positive marketing side effect in the still young decade, especially for marketing as a pioneer in the field of environmental protection. But nothing more.

It's about the higher future costs for environmental protection regulations, electricity peaks (infrastructure and grid stability) and the CO2 balance.

The CO2 balance, also known as the greenhouse gas balance or CO2 footprint, will become more important in the future if there are tax and cost surcharges in the CO2 labeling of goods and services.

Electricity price development for industry – possible scenarios from 2021 to 2030 – Image: Xpert.Digital

Index on the development of industrial electricity prices in Germany from 1998 to 2021 (1998 = Index 100). Forecast from 2021 to 2030 in various scenarios.

The statistics shows the index for the development of the industrial electricity price in Germany from 1998 to 2021. Starting from 1998 (index value = 100), the index value for the development of the industrial electricity price in Germany in 2021 was 195 points.

The information refers to industry supplied by medium voltage with an annual electricity consumption of 160 to 20,000 megawatt hours.

Following decisions on the coal phase-out and the 2019 Climate Protection Act, electricity prices are expected to rise by around 40% by 2030.

Suitable for:

• Optimizing your own electricity consumption: What is overlooked in all financing models
• Background knowledge on petroleum, CO2 taxes and renewable energies

Shipment Zero

As Amazon writes in its blog : “In our operations alone, we have over 200 scientists, engineers and product designers dedicated exclusively to finding new ways to use our scale to benefit customers and the planet. Amazon's long-term goal is to power its global infrastructure with 100% renewable energy, and we are making solid progress toward it. With improvements in electric vehicles, aviation biofuels, reusable packaging and renewable energy, we can now see a path to carbon neutral delivery of shipments to customers for the first time, and we are setting the ambitious goal of achieving 50% carbon neutrality for all Amazon deliveries by to be achieved by 2030. We call this project Shipment Zero.”

It would be remiss if we assumed that Amazon, as a moral leader for a green future, is doing all the effort and investment. 200 scientists, engineers and product designers are not there to model a green future, but rather to secure and increase the company's sales and profits, reduce costs where possible, in order to secure and expand the market position for the future .

Amazon relies on 2 pillars:

• Automation with the help of digitalization (digital transformation), smart technology (especially smart factory), Internet of Things and Industry 4.0.
• Autonomy in the power supply (CO2 neutrality), increasing your own independence and energy efficiency, climate neutrality

Photovoltaics is autonomous power supply

Falling installation costs and government incentive programs have encouraged the adoption and scalability of solar as a practical energy source for businesses. As costs continue to fall, enterprise adoption rates are expected to increase, continuing this correlative trend.

The Federal Association for Renewable Energy (BEE) assumes that solar energy will have the largest installed renewable capacity in Germany by 2030, at 100 gigawatts (GW). Wind turbines (on- and offshore) follow in second and third place with 59 GW and bioenergy with 6 GW. Hydropower and geothermal energy share fourth place with 0.5 GW each.

Photovoltaics is particularly ideal for the manufacturing industry, mechanical engineering and logistics, with their large areas and halls.

Green Deal, a signal for the economy – Photo: Mr. Loeffler|shutterstock

Industrial network

You don't have to be Amazon and the course set with the European Green Deal by the EU Commission and its President Ursula von der Leyen is a strong signal for the European economy.

Now it's up to us to select the various competencies

• intralogistics,
• photovoltaics and
• Digital transformation

to bring together.

The German economy in particular has the best conditions for this. Now it is important to use the know-how and, together with Europe, catch up and expand the economic and competitive advantage.

In Intralogistics, Logistics, Mechanical Engineering and the Manufacturing Industry

CO2 Neutrality with Photovoltaics – Photo: Wetzkaz Graphics|shutterstock

Some see the European Green Deal as another attempt by the EU to patronize or even repress its citizens. However, few know that this is actually about the planning security and transparency for industry and investors to ensure a green growth strategy. It is an ambitious goal of the EU to be the world's first climate neutral continent by 2050.

But there are other ways to approach this, and there are plenty of other reasons worth thinking about. Shipping and fulfillment costs at the online retailer Amazon have skyrocketed in the last ten years : The total logistics costs between 2009 and 2019 had risen more than 20 times.

• Last year alone, the company's shipping costs amounted to 37.9 billion dollars.
• Fulfillment costs (eg costs for the operation and staffing of fulfillment centers) add another 40.2 billion dollars to a huge logistics bill.
• Although Amazon's revenues have also increased by more than ten times since 2009, this was not enough to compensate for the increase in logistics costs.
  In 2009, shipping and fulfillment costs amounted to 15.6% of net sales. By 2019, this share had risen to 27.9 percent.

After all, competitiveness and the competition of market shares has its price. Therefore, Amazon doesn't leave anything to chance. Amazon is not only the world leader in research spending , it is also investing in the expansion of its robotics . Robotics is not only faster and more powerful, but also less prone to errors and more reliable. The idea behind it : The higher the level of automation provided by robotics, the lower the proportion of their staff costs and the lower the benefits of cheaply available workers.

Amazon invests enormously in research and robotics – Photo: Mike Mareen|shutterstock

Amazon has also made impressive progress in the field of photovoltaics, rising from zero to almost 330 megawatts of energy output in just five years . This year, a 45 MW solar farm will be completed in Virginia and is expected to provide 100,000 megawatts of clean electricity annually. Further solar parks have been planned in Seville (Spain) with 149 MW, in Lee County, Illinois (100 MW) and in Northern Virginia (80 MW).

In the USA (2018), Amazon ranked first for the number of solar plants installed and second for the total number of solar plants installed to date.

Amazon now operates 70 renewable energy projects worldwide (21 wind and solar parks and 50 solar parks on logistics centers), with an estimated total capacity of 1,900 MW, providing 5.3 million megawatt hours (MWH) of climate-neutral electricity annually.

These are remarkable numbers! But this shows once again that Amazon is not only counting on

• robotics and
• automation

for the expansion of its market leadership in the future, but also on

• autonomous power supply.

The focus here is not on green intralogistics , sustainability, CO2 reduction and decarbonization – in this still relatively new era it is a significant positive side effect being able to market itself as a pioneer in the field of environmental protection. But that's all it is.

Actually, it is about the costs of environmental protection requirements, power peaks (infrastructure and grid stability) and CO2 Balance, which will most likely increase in the future.

In the future, the CO2 Balance, also known as the Greenhouse Gas Balance or CO2 Footprint, will gain more of a decisive influence when the CO2 labeling of goods and services will be subject to tax and cost-related surcharges.

Electricity price development for industry – Possible scenarios from 2021 to 2030 – Image: Xpert.Digital

Index for the development of the industrial electricity price in Germany from 1998 to 2021 (1998 = index 100). Forecast from 2021 to 2030 in various scenarios.

The statistics show the index for the development of the industrial electricity price in Germany in the years 1998 to 2021. Starting from 1998 (index value = 100), the index value for the development of the industrial electricity price in Germany in 2021 was 195 points .

The figures relate to medium-voltage supplied industry with an annual electricity consumption of 160 to 20,000 megawatt hours.

Following decisions on coal phase-out and climate protection legislation in 2019, electricity prices are expected to rise by around 40% by 2030.

More information:

• Electricity self-consumption optimization: what is overlooked in all financing models
• Background knowledge on oil, CO2 tax and renewable energies

Shipment Zero

This is what Amazon writes in their blog : “In operations alone, we have over 200 scientists, engineers, and product designers dedicated exclusively to inventing new ways to leverage our scale for the good of customers and the planet. Amazon has a long-term goal to power our global infrastructure using 100% renewable energy, and we are making solid progress. With improvements in electric vehicles, aviation bio fuels, reusable packaging, and renewable energy, for the first time we can now see a path to net zero carbon delivery of shipments to customers, and we are setting an ambitious goal for ourselves to reach 50% of all Amazon shipments with net zero carbon by 2030. We are calling this project Shipment Zero .”

It would be short-sighted to assume that Amazon is making all the effort and investment as a moral leader for a green future. 200 scientists, engineers and product designers are not there to set an example for a green future, but to secure and increase the company's sales and profits, to reduce costs where possible, and to ensure and expand the market position for the future.

Here Amazon relies on 2 principles:

• Automation with the help of digitalization (Digital Transformation), Smart Technology (especially Smart Factory), Internet of Things and Industry 4.0.
• Autonomy in power supply, increase of the own independence and energy efficiency, climate neutrality.

Photovoltaics is an autonomous power supply

Decreasing installation costs and government subsidy programs have promoted the acceptance and scalability of solar as a practical energy source for companies. As costs continue to decrease, it is expected that company acceptance rates will increase, continuing this correlative trend.

The German Renewable Energy Federation (BEE) assumes that solar energy will have the largest installed renewable energy capacity in Germany by 2030, at 100 gigawatts (GW). In second and third place are wind turbines (onshore and offshore) with 59 GW and bioenergy with 6 GW. Hydropower and geothermal energy share fourth place with 0.5 GW each.

Photovoltaics is just perfect for the manufacturing industry, engineering and logistics, with its large areas and halls.

Green Deal, a signal for the economy – Photo: Mr. Loeffler|shutterstock

Industry Network

There is no need to be Amazon and the course set with the European Green Deal by the EU Commission and its President Ursula von der Leyen, is a strong signal for the European economy.

Now it's up to us to combine the skills of:

• intralogistics,
• Photovoltaics, etc
• Digital transformation

Particularly the German economy has the best conditions for this. Now is the time to use the know-how and, together with Europe, to catch up and expand the economic and competitive advantage.

► Contact me or discuss with me on LinkedIn

What will be crucial for the future will be how we secure the infrastructure of our key industries!

Three areas are of particular importance here:

• Digital Intelligence (Digital Transformation, Internet Access, Industry 4.0 and Internet of Things)
• Autonomous power supply (CO2 neutrality, planning security, safety for the environment)
• Intralogistics/logistics (full automation, mobility of goods and people)

Xpert.Digital delivers you here from the Smart AUDA series

• Autonomization of energy supply
• urbanization
• Digital transformation
• Automation of processes

always new information that is updated regularly.