Earlier this week Amazon dropped its 2022 Sustainability Report, and there are three big takeaways from it: 1) its plastic packaging finally seems to be decreasing, 2) starting in 2024, the world’s biggest retailer will be asking its supply chain to report emissions, and 3) its own emissions are finally on the decline.
It’s an understatement to say that up until now, many of Amazon’s “sustainability initiatives” have produced less than tangible results. Around this time last year, the e-commerce giant reported an 18% increase in planet-warming emissions despite its initiatives, which was more than 40% of what the company produced in 2019.
However, this year, for the first time ever, Amazon reported a decline in its emissions, detailing that it produced 71.27 million metric tons of carbon dioxide last year. That’s down 0.4% from 2021. It’s… not much compared to the 18% jump in its carbon footprint it reported from 2020-2021; still, it’s a start.
As Kara Hurst, the company’s Vice President and Head of Worldwide Sustainability, explains in a blog post detailing her nine takeaways, “Amazon is a high-growth company, and a decreasing carbon intensity indicates that we’re successfully decoupling our emissions growth from the growth of our business.”
In addition, it also reported its carbon intensity, which measures emissions per dollar of sales, fell 7% between 2021 and 2022, and has fallen 24% since 2019. According to the company, they were able to accomplish this through a combination of energy efficiency improvements across its business and continuing its investment in renewable energy. Hurst says this metric allows the company “to measure how our carbon footprint is changing relative to the growth of the business."
In fact, the tech giant kicked off the year by setting a new record for the most renewable energy purchased in a single year.
As CNBC’s Catherine Clifford eloquently puts it, “Amazon is the 500-pound gorilla in a room full of puppies when it comes to corporate buying of wind and solar power.” And they have to be — puppy-sized investments can’t solve a mammoth-sized emissions problem when Amazon plans to power its operations with 100% renewable energy by 2025 and be net zero by 2040.
According to the report, in 2022, 90% of the electricity consumed by Amazon was powered by renewable energy sources, thanks to more than 400 wind and solar projects around the world.
In addition to its solar and wind investments, the company is a behemoth when it comes to its investments in decarbonization tech that focuses on sectors where cutting emissions is more difficult, accomplished via its multibillion-dollar venture capital fund, The Climate Pledge Fund.
On the delivery side of things, the company has also cut emissions by electrifying its delivery fleet. Most recently it purchased 100,000 Rivian electric delivery vans, which it has said will hit roads by 2030, piling onto the 9,000 electric vehicles in its global fleet.
When it comes to the actual packages in the infamous Amazon delivery trucks, the company reports that the orders shipped out from its fulfillment centers last year used an 11.6% decrease in single-use plastic than what was used in 2021, coming in at a grand total of 85,916 metric tons.
Amazon attributes its plastic decline to its expanded use of paper-based packaging, as well as an increased effort to ship items in their original containers, forgoing new boxes stamped with the recognizable Amazon logo. Plus, Amazon has stopped using non-recyclable bags made of mixed materials, and on Tuesday it also announced it’s “phasing out” padded plastic mailers, the blue and white envelops usually reserved for smaller items, in favor of more “recyclable alternatives.”
This is the first time the company has given a quantitative estimate of the company’s single-use plastics footprint.
And 3) it could be a nudge for greater transparency from other gigantic companies like Pepsi, Coca-Cola, and Mars, that like Amazon, signed onto a prominent pledge to reduce virgin plastic, but instead are going in the wrong direction.
Still, over 86,000 metric tons is a whole lot of plastic being shoveled into landfills and incineration plants and advocates would like to see Amazon put its mammoth foot down and decide to phase out single-use plastics once and for all.
Aside from its own emissions and reductions, the company will also begin requiring its supply chain to report emissions starting next year.
As a $525 billion company, its supply chain is long and isn’t limited to its most recognizable e-commerce business.
“While our most visible sustainability work may be in how we deliver orders to customers’ doorsteps, we are more than an e-commerce company, Amazon is an entertainment studio, cloud provider, grocer, and more — and we are making sustainability a priority across all of our business,” Hurst writes in the report’s opening letter.
So, Amazon is forcing its supply chain on the sustainability train, but it will also provide them with a helping hand.
Starting in 2024, Amazon will update its supply chain standards “to require regular reporting and emissions goal setting,” and as Hurst writes, “We’ll also use our scale, investment, and innovation to date to provide our suppliers with products and tools that will help them reach their goals — whether those are transitioning to renewable energy or increasing access to sustainable materials.”
While Amazon offered little details on how this project will work, the headline that they will be requiring suppliers to report emissions is news enough.
In helping “select suppliers” transition to using carbon-free electricity, Amazon is taking a page from Walmart and Apple’s books, both of whom are using similar schemes to decarbonize. Plus, according to the report, Amazon is most interested in “suppliers that help us achieve our decarbonization vision as we select partners for business opportunities.”
This type of reporting will not only help Amazon reduce its carbon footprint by allowing it to second-guess enabling companies with bad climate practices but it will incentivize its 9.7 million Amazon sellers to do better… and that’s just on the e-commerce side.
Since launching in 1994, Amazon has grown to become the world’s biggest retailer and now, it’s got its hands in a litany of sectors. Its decarbonization is not only about slashing emissions in the way you get your Amazon orders but also in the way it creates its own electronics, operates its data centers, entertainment studios, music platform, and so much more.
They could always do better, however. With extreme heat prompting the first-ever Amazon delivery driver strike to the need to shrink its carbon footprint a lot faster than it currently is, the multinational company still has a lot of work to do. Still, it seems its push for sustainability has finally toppled the first domino. Here’s to hoping the rest fall.