Switching to green electricity in the reference warehouse leads to:
Key results
5,200 tons
total CO₂ savings over 15 years
47%
of total warehouse CO₂ emissions for the sample warehouse
€2.3 million
OpEx increased over 15 years
At a glance
Procuring electricity from renewable or green sources such as solar or wind can lead to significant emission reductions. Nonetheless, the results vary from country to country due to differences in electricity generation and imports. Whereas some regions, for example regions such as Scandinavia, already use mainly green electricity, others such as Germany or Hungary rely more on fossil fuels, namely coal and natural gas. Additionally, local markets for green electricity are not developed everywhere, making it difficult for companies in some regions to choose green electricity even if they wanted to. Compared to other measures, switching to green electricity increases costs, but also significantly reduces emissions.
The case in context
About 67% of emissions from logistics facilities are a result of electricity usage. The primary electricity consumption within logistics facilities is for indoor lighting and equipment for material handling such as forklifts or automated shelves.1 Therefore, site operators and users should consider shifting towards green energy sources to reduce their carbon footprint.
A closer look: case details and parameters
Today, conventional electricity generally remains more cost effective than renewable alternatives, although this cost difference varies from one country to another. Furthermore, the availability of renewable energy resources differs widely among nations. Switching to renewable electricity does not require a substantial initial investment, but it does lead to higher OpEx if the price difference between renewable and conventional electricity persists. Our analysis focuses on key parameters affecting CO₂ abatement costs for the multiple European regions considered. These parameters include the electricity mix, emission factors (i.e., the amount of CO₂ emitted per kWh) and industrial electricity prices. We compare these factors under two scenarios: one with a 100% green electricity mix and its emission factor, and the other with conventional electricity prices from the respective countries.
Results
The results show that in countries with a high share of fossil fuels in the energy mix, transitioning to green electricity increases costs but also significantly reduces carbon emissions. Countries where green electricity is already the status quo were not considered for this measure. A third disputable group are countries with significant nuclear electricity generation, such as France, where depending on the emission factors applied, total emissions can even increase. The map above illustrates CO₂ savings in tons over 1 year for each country considered.
Evaluation: largest emissions reduction in study and an optimistic OpEx forecast
Transitioning to green electricity stands out as the measure with the largest reduction in CO₂ emissions within the scope of this case study. Although OpEx is currently higher compared to conventional electricity, primarily due to the prevailing elevated market prices of green electricity, the potential benefits are significant. A future shift in electricity prices could make this initiative even more attractive, providing a business case with negative CO₂ abatement cost (i.e., cost savings and reduced emissions). Switching to renewable energy has the potential to become an easily implementable measure that offers substantial emission savings. However, the success of this approach depends on the availability of green electricity in the specific country or countries in question.
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