Business Transport

From Open Sustainability

Business Transport

Transport is the fastest growing source of greenhouse gas emissions, and commuter and business travel constitute nearly 40% of miles driven by car ^[1]. Measures to reduce excessive vehicle use are vital for any business that seeks to make its operations more sustainable.

To understand how to reduce the environmental impact of your business transport the first thing you need to do is assess your current use of transport for example working out its carbon footprint.

There are many ways a reduction can be achieved:

Workplace travelplan

This is a package of measures produced by employers to encourage staff to use alternatives to single-occupancy cars. This could include promoting flexible-working practices and video conferencing and encouraging more efficient journeys through the introduction of car sharing schemes, cycling facilities, bus services or restricted car parking ^[2].

Fleet management

Rethinking your logistics, the planning and implementation of moving goods and supplying services, can be important to reducing environmental impact. Freight transport is a key part of logistics and whether your business is moving its own or another organisation's goods, considering how to improve your systems may deliver business benefits, as well as reducing your impact on the environment.

In the UK organisations with more than 50 vehicles are eligible for a free on site Green Fleet Review by a fleet management expert.

Vehicle choice

Selecting transport options with a reduced environmental impact. If your business has its own fleet of vehicles, you could make significant emission reductions and cost savings by choosing models with lower emissions.

Petrol and diesel engines have different effects on the environment. As a general rule, if you intend to use the vehicle for long-distance or motorway driving then consider a diesel engine for fuel efficiency and lower carbon dioxide emissions. If the vehicle will be used more in urban areas, where air quality is a greater consideration, then a fuel-efficient petrol engine may be better suited.

Before investing in new or second-hand vehicles you should check their carbon dioxide emission levels to help inform your decision.

Alternatively powered vehicles

There are a range of cleaner fuels and vehicles on the market that can offer significant environmental benefits and help lower your fuel costs. Types of alternative fuel and vehicles include:

• Liquefied petroleum gas (LPG) - vehicles which run on LPG cost around 30 per cent less to run than those powered by petrol and approximately the same as diesel. They produce around 10 per cent less carbon dioxide than petrol vehicles but slightly more than diesel. LPG vehicles emit significantly less air pollutants than diesel vehicles and similar to petrol vehicles. Drivers of LPG-powered vehicles may be able to claim lower company-car tax rates.

• Natural gas - vehicles powered by natural gas (methane) produce significantly less carbon dioxide than petrol vehicles, and similar or slightly less than diesel vehicles but with lower emissions of air pollutants.

• Hybrid vehicles - these are powered by electricity and either petrol or diesel. They recharge their batteries during normal operation. This means less fuel is burned so carbon dioxide emissions can be reduced and fuel costs are around two-thirds that of an equivalent petrol-only vehicle. Hybrids are also eligible for tax breaks, such as lower vehicle excise duty.

• Electric vehicles - these produce no direct exhaust emissions, but there is still an environmental impact from the generation of electricity. You can reduce this by purchasing electricity generated from renewable sources. Vehicles run on electricity are also given many tax breaks ^[3].

The Benefits

A well-designed travel plan can typically cut 15% of commuter car use and may amount to over a million less miles for just a single company ^[4] reducing negative environmental effects.

In addition to reducing your environmental impact, better use of transport can benefit your business by saving you money, increasing business opportunities and improving its image. This could help attract new employees and increase your customer base ^[5].

It can help meet shareholder demand for corporate social responsibility improvements, including meeting environmental targets such as the ISO14001 standard or global warming emissions targets.

Financial savings can be made by driving more efficiently and reducing fuel costs and wear and tear. Further financial benefits could be gained through more cost-effective use of your employees' time and by unlocking the potential of land previously used for parking.

Investing in greener transport methods may also make you eligible for enhanced capital allowances and other tax breaks. Moreover, because travel plans are so effective for small outlays, national planning guidance now says that all planning applications with significant transport implications should be covered by a travel plan.

The benefits can extend to the employees too. Encouraging them to walk, cycle or use public transport for commuting and business travel can benefit their health and finances. It may also contribute to reduced sickness absence, increased staff retention and improved local air quality.

Vehicle Emission Legislation

Currently vehicles only need to have passed a MOT (Ministry of Transport) test to be road legal. Above this however, local authorities can implement their own schemes to control vehicle emissions in areas of poor air quality.

In the UK all local authorities are required to monitor air quality in their areas and if this falls below the national air quality objectives, they may declare an Air Quality Management Area and take action to meet the objectives. This could have consequences for your business ^[6].

In Greater London for example there is now a Low Emission Zone where the charges for diesel-engine vehicles travelling through the zone currently apply to lorries over 3.5 tonnes and buses and coaches over 5 tonnes.

Tax breaks

As the UK government is keen to encourage the purchase and use of environmentally friendly cars by business, businesses can benefit if they buy certain low-carbon emissions cars.

Cars that are electric, or with very low CO2 emissions of 110 grams or less per kilometre (g/km) driven, qualify for a 100 per cent capital allowance until 31 March 2013.

For other cars, the government announced its intention to modernise the tax relief for business expenditure on cars, by moving away from a system based on cost, to one based on the CO2 emissions.

Subject to these changes becoming law, expenditure incurred on or after these dates on:

• cars with CO2 emissions of less than 160g/km qualifies for 20 per cent capital allowances in the main rate pool
• cars with CO2 emissions over 160g/km qualifies for 10 per cent capital allowances in the special rate pool^[7].

Company car tax is also based on a car's carbon dioxide emissions. The lower the emissions, the lower the personal tax paid by the driver.

References

1. ↑ http://www.dft.gov.uk/pgr/statistics/datatablespublications/personal/mainresults/
2. ↑ http://www.dft.gov.uk/pgr/sustainable/businessrelatedtransport
3. ↑ http://www.energysavingtrust.org.uk/business/Business/Transport-in-business/Low-carbon-technology/Alternative-fuels
4. ↑ http://www.dft.gov.uk/pgr/sustainable/travelplans/work/ngtravelplansworklessons5783.pdf
5. ↑ http://www.businesslink.gov.uk/bdotg/action/layer?topicId=1080531485
6. ↑ http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1080531565
7. ↑ http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1080532548