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Q2 2015 Earnings

July 28, 2015
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Our Position: Where We Stand On Bio-Fuels

There is considerable controversy in society regarding the environmental trade-offs of bio-fuels compared to conventional fossil fuels, and even in how to appropriately measure their environmental benefits. For example, some environmental organizations favor the "life-cycle analysis" method of evaluating bio-diesel fuel, which takes into account carbon dioxide sequestered in the process of growing the plants for the fuel.

This method results in a significantly better environmental performance for bio-diesel compared to conventional diesel fuel. In contrast, other climate protection organizations focus on tail-pipe emissions, which do not reflect the life-cycle benefits of bio-fuels. We are engaged in this societal dialog at multiple levels, and are involved with other air transport companies in supporting the development of jet engine bio-fuels, because we believe bio-fuels are important to the long-term environmental health of our company and our planet.

We also have formulated a set of principles for more widespread use of bio-fuels at UPS in the future. According to these principles, we look forward to a time when bio-fuels:

  • are produced in an environmentally and socially responsible manner.
  • meet or exceed existing fuel performance standards.
  • are compatible with available engine technology.
  • work in real-world operating conditions.
  • are economically viable.
  • are available in robust fuel supply chains.
  • surpass the environmental performance of conventional fuels.

To advance our understanding of relevant issues and help bring greater clarity to our stakeholders, we became a founding member of an initiative launched by BSR, a leading NGO for corporate sustainability. The initiative, know as “Future of Fuels” will address three broad areas that society needs to understand more fully and completely. These topics include the following:

  • Fossil Fuel dependency
  • Strategies for companies to navigate the issues
  • Opportunities  and tools for moving forward

As we participate in the BSR initiative, we will continue to develop our own understanding and capabilities, put new fuels and technologies to the test in or operations, and advocate for intelligent public policy. We will also work with others to facilitate change. As the world’s largest package delivery company, we recognize that we have a responsibility to lead through what we say as well as what we do.

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