Investor Presentaiton
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Decarbonising our transport
- a material shift in our scope 1 and 3 emissions
Global transport activity is expected to more than double by 20501, yet emissions in this sector need to decrease
at least 3% annually to align with net zero by 2050. Transport is Australia's third largest emissions source,
and government projections forecast an emissions increase of approximately 5-10% in this sector by 2030.2
The challenges and opportunities of a large, complex transport fleet
Woolworths Group's transport network is one of the largest business supply chains in Australia and New Zealand,
with approximately 1.6 billion cartons moved annually through Primary Connect, and 19% growth in online delivery
volumes in the past year. Our directly managed fleet - scope 1 transport emissions - comprises some 3,500 assets,
from light vehicles to semi-trailers.
As with the rest of our value chain (described below), scope 3 emissions represent the larger part of our transport footprint,
which is outside of Woolworths Group's direct control. Tackling transport decarbonisation will therefore require significant
effort due to the size and complexity of our own fleets and those of our logistics partners. We work with existing partners
to drive efficiency, and explore new industry solutions (e.g. hydrogen).
Our transport fleet
Delivering food to our customers every day is made possible through international freight movements via air and sea,
interstate connections via rail and road, and movements between DCs and stores. These emissions vary between direct
scope 1 and indirect scope 3 emissions.
Our transport decarbonisation strategic priorities
Transport currently makes up less than 5% of the Group's scope 1 and 2 emissions which is the equivalent
of approximately 100,000 tonnes of carbon dioxide. However, our internal modelling shows that following our
transition to renewable electricity by 2025, if no action is taken, transport emissions will represent approximately
40% of our scope 1 and 2 emissions by 2030.
In light of this, we launched Woolworths Group's transport decarbonisation strategy in F23. This is anchored in our
commitment that by 2030, we aim to convert our Australian and New Zealand home delivery fleet to zero-emissions
vehicles. This goal, alongside changes to zero emissions technology in our heavy vehicle fleet, will reduce our
scope 1 transport emissions by approximately 60% compared to a 2023 baseline.
It has three pillars:
1. transitioning to a zero-emissions fleet and delivering cleaner, quieter neighbourhoods
2. leading low-carbon practices through efficient operations, such as offering customers the choice of Green
Delivery windows that minimise grocery delivery emissions
3. developing zero emissions transport infrastructure (e.g. EV chargers) across our network.
Annual Report 2023
Woolworths Group
1
highlights
Performance
2
International
freight
International movements to
Australia and New Zealand
Inbound delivery
Inbound transport
from suppliers to
distribution centres
Distribution centre
operations
Product storage and
yard operations
ooo
PRIMARY
CONNECT
Store
delivery
Transport from DCs
to stores and CFCs
Transition readiness assessment for decarbonisation (F23)
With the limited current availability of zero-emissions vehicles for a fleet of our size and operational complexity,
we have gained valuable insights through trialling and testing a small number of low-carbon vehicles. In June 2023
Woolworths Supermarkets added 27 electric vehicles to its home delivery fleet. The new electric vehicles will start
delivering groceries to customers in Sydney and will operate out of the Mascot and Caringbah customer fulfilment
centres, which are dedicated to picking and packing online supermarket orders. Over 1,000 electric vehicles will
be added to the existing fleet over the next seven years as part of this commitment with the aim of reducing overall
transport emissions by around 60% by 2030.
Across international shipping and national logistics, we are exploring where we can support trials of lower emissions
fuels. These have the same challenges as our own fleets, requiring a combination of improved fuel, new propulsion
technology, and supporting infrastructure.
Shipping lines run by others,
importing internationally-
sourced products
Scope 3-50,000t
Carrier transport partners
supplying Woolworths Group
ecosystem of companies
Scope 3 included
in category 1 (see page 49)
DC yard operations by
Woolworths Group.
These are support vehicles
that stay on site
Scope 1-1,000t
Refrigerated trailers owned by
Woolworths Group, trucks owned
by carrier transport partners.
Includes delivery into BIG W
Scope 3-300,000t
B2B
delivery
Wholesale delivery
including PFD
Last mile
delivery
Online delivery from a store
or CFC to customer
Customers
and team
End customer pick up
and team transport
B2B including third party logistics,
PFD-owned delivery fleet
Scope 1-30,000t
Scope 3 to be estimated
Commence transition
Home delivery
Transition now
Monitor and engage
International
freight
Test and trial
DC
operations
Trailers
Light
vehicles
PFD
vehicles
Trolley
collection
Store
delivery
Home delivery fleet owned/leased
by Woolworths Group
Woolworths Group team and trade
vehicles, trolley collection, vehicles
Scope 1-45,000t
Scope 1-5,000t; Scope 3
included in Category 9 (see page 49)
High
Technology Maturity (vehicle availability)
Key:
Scope 1 emissions
Scope 3 emissions
Size of circle = size of emissions
1
OECD International Transport Forum.
2
Commonwealth of Australia (Climate Change Authority) 2022. First Annual Progress Report, November 2022.
High
review
Low
Transition Complexity
Low
Business
3
Report
Directors'
4
Financial
Report
LO
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