How can warehouses become more sustainable?

A guide for Earth Day and beyond

Sustainable warehouses balance all aspects of your warehouse operations, including economic, environmental and social inputs and outputs. With Earth Day 2024 approaching, in this article we will focus on environmental sustainability, and explore how warehouse owners and managers can make their operations more sustainable.

Green coloured warehouse roller doors

In the age of e-commerce and rapid product delivery, warehouses are the backbone of our modern supply chain. However, their efficiency often comes at an environmental cost. This article explores practical steps you can take to reduce your warehouse's environmental footprint. By implementing these strategies, you'll not only be contributing to a healthier planet but potentially saving money on energy and waste disposal costs.

What is Earth Day and how does it relate to sustainable warehousing?

Earth Day is celebrated on 22nd April every year, engaging more than 1 billion people. The annual event raises awareness about environmental issues and promotes sustainability, highlighting the critical need to protect planet Earth. Since 1980, it's been a day to reflect on the impact our actions have on the planet and take steps towards a healthier future.

The World Economic Forum (WEF) highlights that the industrial real estate sector, which includes warehouses, is responsible for more than 20% of global greenhouse gas emissions*. This substantial contribution is primarily due to the high energy consumption required for heating, cooling, and lighting large warehouse spaces. Beyond energy use, the WEF emphasises the industrial real estate sector's impact on resource consumption. Warehouses utilise a significant amount of raw materials for construction and ongoing operations, and the packaging waste generated within the warehouse when it's operating can be substantial.

Did you know, for third-party logistics (3PL) providers and those operating warehouses, utility bills account for at least 10% of company revenue? You can reduce this by implementing environmental friendly solutions that align with Earth Day's values, here's how:

> Reduced environmental footprint: Warehouses can be significant energy consumers and waste generators. Sustainable practices in warehousing minimise energy use, waste generation, and pollution, contributing to a healthier planet.

> Resource conservation: Earth Day emphasises the importance of resource conservation. Sustainable warehouses promote responsible use of resources like energy and materials.

> Long-term sustainability: Sustainable practices in warehousing ensure responsible use of resources for the long-term, promoting a sustainable future for generations to come.

What does this mean for warehouses?

Sustainable warehouse development reduces the impact on the environment through the use of alternative materials, life cycle of the construction, design, operation and demolition of these industrial facilities.

Building a sustainable foundation

Sustainability starts at the ground level, even before a product enters the warehouse. Here's how to make your physical space more eco-friendly:

> Location, location, location: Consider the warehouse's proximity to transportation hubs and customer base. A strategically located warehouse reduces transportation distances and associated emissions.

> Building green: When possible, use recycled or sustainable building materials during construction or renovation. Additionally, invest in energy-efficient features like skylights for natural light and cool roofing to minimise heat absorption.

Harnessing power efficiently

Warehouses are notorious for high energy consumption. Here's how to cut down on your electricity usage:

> LED lighting revolution: Replace traditional incandescent or fluorescent lights with LED alternatives. LEDs are significantly more energy-efficient and last longer, reducing long-term costs.

> Smart lighting control: Install motion sensor lighting systems to ensure lights are only on when necessary. This simple switch can significantly reduce energy waste, especially in areas with low daytime traffic.

> HVAC optimisation: Regularly maintain your HVAC system to ensure peak efficiency. Additionally, explore programmable thermostats to regulate temperature fluctuations when the warehouse is unoccupied.

On the blog: Improving warehouse efficiency with an optimised layout. Click this banner to read the article.

Optimising warehouse operations

Small operational changes can have a big impact on your environmental footprint. Here are some ways to streamline your warehouse processes:

> Space utilisation: Optimise your storage layout to maximise vertical space and minimise empty aisles. This reduces overall energy consumption needed to maintain a comfortable temperature throughout the warehouse.

> Picking and packing efficiency: Implement a streamlined picking and packing system to reduce travel time for workers and forklift trucks. This minimises fuel consumption and wear and tear on machinery.

> Automation for efficiency: Consider warehouse automation solutions like automated storage and retrieval systems (ASRS) for specific tasks. While there's an initial investment, automation can significantly improve picking and packing efficiency, reducing overall energy consumption.

> Electric forklifts (MHE): Eliminating the need to fossil fuels is not only good for the environment but it is also safer for employees. They produce significantly less noise and pollution, helping to reduce your environmental impact and improving warehouse conditions.

Waste reduction and responsible disposal

Warehouses generate a substantial amount of waste from packaging materials and damaged goods. Here's how to minimise waste and dispose of it responsibly:

> Sustainable packaging: Partner with suppliers who use eco-friendly packaging materials that can be recycled or composted. Additionally, explore ways to minimise packaging altogether, like using reusable containers for specific products.

> Waste management: Implement a comprehensive waste segregation program. This allows for efficient recycling of paper, cardboard, plastic, and other materials. Partner with a reputable waste management company that prioritises responsible disposal practices.

> Inventory management: Maintain accurate inventory control systems to minimise overstocking and the potential for product damage that ends up as waste.

The power of people

Sustainability isn't just about technology and infrastructure; it's also about your team. Here's how to create a culture of sustainability within your warehouse:

> Employee education: Train your employees on the importance of sustainable practices and how their actions can contribute. This could include proper waste segregation, responsible energy usage (like turning off lights during breaks), and a focus on minimising damage during handling.

> Incentivise Green choices: Consider implementing incentive programs to encourage employee participation in sustainable practices. Recognition and rewards can further motivate employees to make eco-friendly choices.

> Open communication: Maintain open communication channels with your employees. Encourage them to suggest ideas on how to improve warehouse sustainability.

On the blog: Creating the ultimate warehouse workforce. Click this banner to read the article.

Positive impacts of sustainable warehouses

Creating a sustainable warehouse brings many positive impacts that extend far beyond just environmental benefits. Here's a breakdown of the key advantages:

Environmental benefits:

> Reduced carbon footprint: Sustainable practices like energy efficiency and responsible waste management lead to lower greenhouse gas emissions, combating climate change.

> Resource conservation: Warehouses that prioritise sustainability minimise their consumption of energy, water, and raw materials, lessening the strain on natural resources.

> Waste reduction and responsible disposal: Implementing recycling programs and minimising packaging waste reduces landfill waste and promotes responsible waste management practices.

Economic benefits:

> Cost savings: Sustainable practices often translate to lower energy bills, reduced waste disposal fees, and potentially lower water usage costs.

> Operational efficiency: Implementing efficient warehouse layouts, waste segregation systems, and optimised picking strategies can save time and labor costs.

> Enhanced brand image: Consumers are increasingly environmentally conscious. Sustainability efforts can improve brand image, attract eco-conscious customers, and potentially lead to increased sales.

Social benefits:

> Improved employee health: Sustainable practices like proper ventilation and natural lighting can create a healthier and more comfortable work environment for employees.

> Employee morale and engagement: When employees see their workplace actively contributing to environmental well-being, it can boost morale and create a more engaged workforce.

> Community goodwill: Operating a sustainable warehouse demonstrates environmental responsibility to the local community, fostering goodwill and potentially attracting a more qualified talent pool.

Examples of sustainable warehouses

Here’s some examples of sustainable, best-in-class warehousing.

Global example:

Photo of NewLogic III building, nicknamed ‘The Tube’
NewLogic III building, nicknamed ‘The Tube’

The NewLogic III building, nicknamed ‘The Tube’, is a 60,500m² facility with warehouse and office space that is airtight with extra insulation. A photovoltaic system (solar) on the roof consisting of 11,620 panels generates more electricity than the building consumes, with excess power going into the grid, meaning it is both energy and CO2 neutral.

The warehouse has natural light flooding through large triple-glazed windows, reducing the amount of electricity needed for lighting and makes it a more pleasant space to work in.

The building also features a heat pump, automatically dimming LED lighting, charging points for electric vehicles and technology that monitors water consumption and CO2 concentrations.

National examples:

Photo of DHL GoGreen truck with worker walking in the background
DHL has made a commitment to reach zero greenhouse gas emission by 2050.

Logistics companies like DHL Supply Chain and Toll Group have both recently built carbon neutral industrial facilities, certified under the National Carbon Offset Standard (NCOS) for buildings.

The industrial building received a Green Star Rating by the Green Building Council of Australia (GBCA), with sustainability initiatives which include LED lighting upgrades and the installation of a 200kW solar PV system. Furthermore, forklift charging is also staggered to reduce peak demand.

Deutsche Post DHL (DPDHL) Group, of which DHL Supply Chain is a division, has had a comprehensive climate protection program in place since 2008. This GoGreen program was initially aimed to have a 30% increase in the carbon efficiency of its business by 2020, but that goal was reached early in 2016. In 2017, the Group set itself a new target of operating completely emissions neutral by 2050. It was the first logistics company to make such a commitment, thereby setting the benchmark for its industry.

Toll Group claims its custom-built Nike warehouse in Altona North, Melbourne, has become the first-ever facility in Australia to achieve a whole-of-building carbon neutral certification under NCOS.

Every step towards environmental sustainability counts

Creating a sustainable warehouse is an ongoing process. By implementing these strategies and fostering a culture of environmental awareness, you can make a significant difference. Remember, by adopting sustainable practices, warehouses can not only help the environment but also potentially see cost savings through reduced energy consumption and waste disposal fees. Earth Day serves as a timely reminder for businesses to consider their environmental impact and take action towards a more sustainable future.

Outgrown your current warehouse and looking for a more sustainable facility that can support your business now and into the future? uTenant can help. Our friendly team with years of experience in supply chain and warehousing, matches tenants with the right warehouse property to meet their requirements.

* While specific data may not reflect the most recent year, it emphasises the significant environmental impact of warehouses.

Updated: 15 April 2024