A few years ago, Amazon announced their plans to become carbon neutral by 2040. As part of this plan, the company has been building differently when it comes to their distribution centers. New centers like their same-day facility in Sacramento, California, which was conceived with the hopes of being recognized as the world’s first ever ILFI Zero Carbon Certified same-day facility. ILFI stands for International Living Future Institute.
The ILFI is a nonprofit promoting sustainable building practices, and this certification means a building is designed to achieve net-zero carbon emissions. The way Amazon is doing this is by combining carbon offsets with renewables and energy efficiency. If you were to visit the behemoth of a facility in Sacramento, you’d see solar panels, energy efficient lighting and HVAC systems, electric vehicles, and they’d be able to tout their carbon offsets during the guided tour.
While Amazon’s newest same-day facility is impressive, especially since the whole thing is optimized to get packages to customers within hours of ordering, it’s not what we want to focus on. We bring up their facility because we’re seeing a wave of companies building net-zero distribution centers, and we want to talk about it. It’s not just amazon, it’s pharmaceuticals and automotive… and a bunch of other spaces. We think it’s going to be the norm one day.
A net-zero distribution center is: a facility designed, constructed, and operated to balance the energy it consumes with the energy it produces. The result is net-zero energy consumption over a defined period, such as one year. This can be done by generating energy on-site, improving efficiency, and things like purchasing renewable energy certificates (RECs). These are credits that represent renewable energy, which is essentially paying for the generation of that amount of renewable energy.
The largest net zero logistics development in North America is currently in development in Moreno Valley, California, called the World Logistics Center (WLC) project. The project is coming to us courtesy of private real estate developer Highland Fairview, with sustainable engineering and design star Stantec as prime consultant. This whopping 4-square-miles facility is slated to be completed in 2030, costing a total of $25 billion. Once completed, it’ll be home to 15,000 permanent jobs.
The project is being constructed on a former landfill site, and Highland Fairview is using sustainable materials and practices to achieve their sustainability commitments. They’re using solar power, LED lighting, a storm water retention system, and a green roof, among other things. It won’t need to wait to be built to do good for the region, as building a structure like this requires thousands of strong backs and comes with 33,000 temporary construction jobs.
In the biotech space, United Therapeutics is jumping on the net zero distribution center bandwagon. The company, which works on rare diseases, is building a net zero energy distribution center in North Carolina’s Research Triangle Park. Expected to be completed next year, the facility will be sporting a microgrid-based electrical system, and geothermal tech. Called “Phase Five”, it’s designed to meet current good manufacturing practices (cGMP) for pharmaceutical products.
In automotive, Volvo Trucks has a net zero distribution center in Ghent, Belgium, featuring solar panels, LED lighting, and other efficient technologies. Toyota is building one in Kentucky, which will have wind turbines in its renewables stack. General Motors is bringing some manufacturing magic back to Detroit, Michigan with a net zero facility there. Just like the others, we’ll see the utilization of solar panels, LED lighting, and other energy-efficient measures.
As of last year, there were little more than a few dozen net zero distribution centers in America… according to a report by the World Economic Forum, that number is set to swell to 100 by 2030. Pressures in America are driving companies to reduce emissions, and that pressure is not a joke. And, as the cost of renewables falls, there’s simply no reason not to use cheaper, cleaner, more reliable energy.
The pressure on companies coming from consumers is getting intense… now that people are living the real-life impacts of climate change, they’re getting ticked off about inaction. That translates to them pulling dollars away in anger. Businesses want to avoid that, as we have seen what a boycott can do to a brand… any brand. Quickly. These are just a few factors that have us convinced this will be the new way things are done.
Really, we think the fact that operating costs for these facilities end up being lower could standing alone to make the point. What rational business owner isn’t looking to reduce operating costs? And don’t forget that e-commerce is booming, which will only keep happening since increasing heat and wildfire smoke make it a danger to even venture out at times. As you can see… we could go on all day, but we’ll stop. Come back next week for more from the green tech space.