DHL Express's use of SAF for greener international shipping

The rise in environmental consciousness in the past decade is undeniable. It spotlights the urgent need for change to protect our planet through the adoption of green transportation and more environmentally friendly shipping practices.

In the logistics industry, significant air travel results in substantial aviation emissions, prompting increased efforts to decarbonise aviation. In October 2021, the International Air Transport Association (IATA) passed a resolution to achieve net-zero emissions by 2050, with 65% of this strategy relying on the adoption of Sustainable Aviation Fuel (SAF), showcasing a committed step towards promoting sustainability.

To understand how this change can create more sustainable air travel for Indonesian businesses, it’s crucial to understand what SAF is.

Sustainable aviation fuel and its advantages

SAF is essentially an eco-friendly alternative to traditional jet fuel. It is derived from renewable resources like used cooking oil, animal fats, and agricultural waste, making it carbon neutral. This innovative fuel can significantly cut greenhouse gas emissions by up to 80% without needing modifications to current aircraft engines.

The advent of SAF is particularly relevant for Indonesian businesses as the country continues to expand its footprint in international trade. From January to November 2023, Indonesia's exports totalled US$236.41 billion. In November 2023, the country's imports were valued at US$19.59 billion, marking a 4.89% increase from October 2023 and a 3.29% rise from November 2022.

With this increase in Indonesia's exports and imports, the adoption of SAF presents the opportunity to not only support Indonesia's growing role in international trade but also contribute to a greener, more sustainable future for global aviation.

Indonesia’s international trade and air freight needs

Indonesia's economy thrives on the export of key sectors such as electronics, textiles, and perishable goods, which leverage a combination of air freight and other shipping methods to reach international markets efficiently.

For electronics alone, Indonesia became the 26th largest exporter in the world, exporting a total of US$17.4 billion worth of goods. This achievement underscores the country's growing role in international trade and hints at the potential for even greater growth as it aims to become the world's fourth-largest economy by 2045. Therefore, as Indonesia's import and export activities are poised for significant expansion, it is paramount to adopt sustainable shipping practices in these key sectors.

Furthermore, embracing green logistics solutions, like the adoption of SAF, is also vital to Indonesia’s commitment to its climate initiatives and to fulfilling its pledge to reach net zero emissions by 2060. These practices not only aim to minimise the carbon footprint of international deliveries but also respond to the increasing international demand for greener supply chains.

DHL Express’ SAF Implementation in Indonesia

At DHL Express, our pivotal role in Indonesia’s trade is underpinned by a deep commitment to sustainable business practices. In alignment with our values, we have entered into a landmark long-term strategic agreement, underscoring our dedication to the decarbonisation of aviation logistics.

This agreement involves the acquisition of approximately 668 million litres of SAF, facilitated through sustainable aviation fuel certificates (SAFc). Set to extend over seven years until 2030, this initiative represents one of the aviation industry's most significant commitments to SAFc to date. Through this progressive partnership, we are focused on achieving significant carbon footprint savings, demonstrating our dedication to a more sustainable future in aviation.

For local businesses, choosing SAF over conventional fuel can lead to significant CO2 emissions saved with their shipments, achieving up to a 30% reduction. This choice also means a 100% reduction in "Tank-to-Wake" emissions, which occur from fuel use in-flight, and up to an 80% reduction in "Well-to-Wake" emissions, covering the entire fuel lifecycle from production to consumption.

Essentially, this transition to SAF for Indonesian businesses contributes to a cleaner environment by substantially lowering their product carbon footprint.

Sustainability as a competitive advantage for Indonesian exporters

The World Economic Forum suggests that businesses should be proactive in reducing their carbon footprint in order to have better relations with regulatory bodies. An illustrative example is the European Union's (EU) taxonomy, which assesses businesses' environmental sustainability. This regulation impacts not only EU-based firms but also global companies operating within the EU, underscoring the importance of adopting sustainable practices for businesses worldwide.

Additionally, for business-to-consumer (B2C) brands targeting the American market, the Harvard Business Review predicts that a significant shift in consumption patterns is on the horizon as younger consumers, with their preference for sustainability, gain more purchasing power. Furthermore, according to FirstInsight's State of Consumer Spending report, 62% of Gen Z shoppers lean towards sustainable brands, with an impressive 73% willing to spend more on sustainable products.

Beyond consumer trends and market demands, sustainability is also important at the business management level. The increasing focus on sustainable practices is largely driven by investor pressure, with companies being guided towards greener operations. Recent research by Mckinsey & Company found that approximately 85% of the chief investment officers we surveyed state that a company’s environmental, social, and governance efforts are important factors in their investment decisions. Therefore, utilising DHL Express' SAF-powered logistics services enables Indonesian businesses to advance their sustainability to meet both international sustainability standards and changing market dynamics.

DHL Express’ GoGreen Initiative and its benefits for Indonesian businesses

Our GoGreen initiative, a cornerstone of our environmental protection efforts, exemplifies our dedication to carbon footprint savings. For over a decade, we have been investing in sustainable solutions to reduce all our logistics-related emissions to net zero by the year 2050.

In Indonesia, our GoGreen solutions are empowering businesses to transform their supply chains into models of eco-consciousness and transparency. For example, we provide detailed carbon and emissions reports, shedding light on what having a carbon footprint means for the business by helping them see the exact environmental impact of their shipments through every mode of transport and across all trade lanes.

Embracing sustainable international logistics solutions with DHL Express

For Indonesian businesses, grasping the importance of sustainability and green logistics is crucial not only for adhering to international standards but also for keeping pace with the evolving demands of the expanding market.

For businesses looking to enhance the operational efficiency of their supply chains while fostering environmental responsibility, DHL Express invites you to open a business account with us today.