Axfood gearing up and phasing out fossil fuels over two-year period

Following the lowering of Sweden’s emission reduction obligation at the end of last year, CO₂ emissions from transports are increasing significantly. As such, Axfood has decided to accelerate the pace of its phase-out of fossil fuels. Over a two-year period, the company’s own and procured transports between warehouses and stores will transition to using renewable fuel or electricity – five years ahead of plan. The initiative will result in the prevention of emissions corresponding to 37,000 tonnes of CO2e per year*.

“Environmental policies are currently complicating the sustainable transition of industry. Following the lowering of Sweden’s reduction obligation, CO₂ emissions from transports are increasing. At the same time, this is making operations more expensive for every company that has its sights set on a transition that will benefit the climate as well as the company’s competitiveness,” says Åsa Domeij, Head of Sustainability at Axfood.

To reduce CO₂ emissions from transports, Dagab – Axfood’s purchasing and logistics company – has successively reduced its share of fossil fuels in the past few years, with a target of achieving net-zero emissions by 2030. The pace of the phase-out of fossil fuels is now being significantly ramped up, with a higher share of more renewable fuels such as biogas, RME and HVO and a higher degree of electrification in the vehicle fleet.

“We were a front-runner in terms of the development of our vehicle fleet, but also in terms of promoting developed infrastructure for electrification together with other companies. Our increased investments in renewable fuel and electricity are therefore a clear sign to the market that we are further gearing up our sustainability activities,” says Hans Bax, Managing Director of Dagab.

Dagab’s vehicle fleet currently comprises 286 heavy-duty and light trucks. However, about half of the transports between the Group’s warehouses and stores, such as Willys and Hemköp, are procured. These transports are currently one of the absolute largest sources of emissions, and comprehensive transition efforts are ongoing together with the transport companies.

“Rather than waiting, we are now accelerating the use of renewable fuel and electricity for both own and procured transports. This will impact our emissions curve significantly as early as in 2024 through a reduced climate impact,” says Åsa Domeij.

For several years, Dagab has chosen to invest in a diversified vehicle fleet with various types of trucks and fuel in order to spread its risks and opportunities in a rapidly changing market. In this way, vehicle investments have also led to new and innovative types of vehicles, the production of sustainable fuels, and infrastructure that promotes the green transition.

An ambitious investment has also been made in order to quickly electrify parts of the vehicle fleet. In 2021, the first fully electric heavy-duty truck went into operation, and in 2022, the fleet was expanded with a 64-tonne electric truck and trailer. The delivery fleet currently includes three heavy-duty electric trucks, and more electric vehicles will gradually be added.

“We will be investing in electrified goods transportation over the next few years. This is an important aspect of our efforts to achieve more sustainable transports and net-zero-emission operations,” says Hans Bax.

*The climate emissions from Axfood’s own and procured transports between warehouses and stores was equivalent to 37,336 CO2e in 2023.