Green Initiatives Can Cushion Oil's Hit

Green Initiatives Can Cushion Oil's Hit

As oil approaches the $100 per barrel mark, businesses must shift from dealing with something that was once only theoretical to a situation that is now a reality.

That's why companies continue to search for ways to better insulate themselves from rising fuel costs. Rather than seeing this purely as a cost issue, logistics and transportation professionals should also see it as an opportunity to bring "green" to their organization.

The challenge with starting green transportation initiatives has always been lack of buy in. In the past, environmentalism was often viewed as a political issue rather than a matter of good business practice.Now, attitudes are changing.

Leading organizations like Wal-Mart are not only implementing green internally, they're also putting pressure on their suppliers to do so. So in addition to the public relations value of going green, there are now also clear financial incentives for doing so.

How you begin a green initiative depends largely on how you manage transportation. Companies that operate their own fleet have far more opportunities for improvement than those relying strictly on carriers. Buying all new equipment built to the latest energy saving specification is the quick solution, but it's also the most expensive, and thus the most difficult to implement. Fortunately, a lot can be accomplished on a small budget.

Going green means finding ways to minimize fuel consumption. While many organizations already have a fuel management strategy, in most cases they haven't exploited every opportunity for saving money. Three specific areas that can be explored are maintenance practices, driver behavior and route planning.

A clearly defined and consistently followed preventative maintenance plan is one of the easiest ways to reduce fuel consumption and harmful emissions. Simple things like low tire pressure, incorrect wheel alignment and clogged air filters have a big impact on fuel efficiency. Regular maintenance can reduce fleet operating costs by as much as 15 percent. Moreover, a poorly maintained vehicle may produce up to 50 percent more harmful emissions than one that is well maintained.

Fleet maintenance organizations should also look into using re-refined oil if it is appropriate for their fleet and consistent with manufacturer recommendations. Re-refining takes about onethird the energy to process used oil than it does to refine crude oil to lubricant quality.

How a vehicle is driven also influences fuel efficiency. Sudden acceleration, harsh breaking and leaving the engine idling for long periods are driver behaviors that can be corrected. The first step is to develop a corporate driving policy and make sure drivers understand it. Fleet operators should also consider installing GPS and engine monitoring technology. These units can monitor engine idling, speed, breaking distance and other driver behavior.

Excessive engine idling is one of the biggest culprits. An idling diesel engine can burn as much as one gallon of fuel per hour, unnecessarily producing greenhouse gasses. Excessive idling is such a problem that many state and local governments have even established fines for leaving vehicles running for prolonged periods.

Reevaluating route plans also has the potential to reduce fuel consumption and emissions. Fleet operators typically think in terms of cost per mile. When planning routes, therefore, a lot of attention is given to reducing total mileage.

The fact is, however, that all miles are not created equal. Some consume more fuel than others - for instance, highway driving vs. city driving. The shortest route may have more stoplights or worse traffic. These conditions increase idling time and call for more frequent acceleration, which is less fuel efficient than driving at a consistent speed. In this case, a longer route may be more environmentally friendly.

Shippers that don't operate a fleet have fewer options for reducing fuel consumption and emissions, but there are a few things they can do. First, these companies should look for carriers that follow green business practices.While not always easy to find, as demand grows, more transportation providers will move in this direction. Consolidating loads, postponing smaller shipments and exploring multimodal deployment can also be effective strategies.

The environmental impact of bringing goods to market is significant. It's estimated that 30 percent of the carbon dioxide produced from human activities comes from road vehicle emissions. Transportation and logistics professionals have the opportunity to do something about this by helping their companies become greener. With ever-rising crude oil prices, it's not just a public relations move, it's smart business.

Bluemner is the vice president of Global Transportation at RedPrairie, which provides global transportation management services for manufacturers.