Reduce Value Chain Transportation Emissions
Environmental Defense Fund
Transport is responsible for a significant share of global emissions and of many companies’ carbon footprint. Reducing the emissions of our freight and passenger transport networks is a major, long-term challenge, but there are actions your company can take now to reduce Scope 3 emissions related to the shipping of your products and employee travel.
For most companies, over 70% of total emissions come from their value chains and transport is a key source of these Scope 3 emissions.1 These emissions are the result of central activities like shipping your products and employee travel.
Measuring, reporting and including Scope 3 transport emissions in sustainability targets can be a challenge. But the short- and long-term benefits of doing so are clear, both in terms of managing your company’s climate transition risks and mitigating the worst impacts of the climate crisis. Understanding and reducing your company’s Scope 3 transport emissions will improve efficiencies, lower costs, and support innovation.
Green Your Freight
Most companies interact with freight networks as consumers of transported goods, or as ‘shippers’ — companies who utilize logistic ‘carriers’ to move the goods they produce or sell. By following the examples of leading shippers and carriers, all freight stakeholders can create a future where freight transport remains affordable, results in less GHG emissions, and minimizes the threat to public health.
Shippers have the most to gain from an increasingly carbon- and cost-efficient freight system for three reasons:
- Profitability: Shippers can reap the greatest financial rewards by increasing their logistics operations’ efficiency.
- Reputation management: Since shippers interface directly with consumers, they stand to gain the most from being viewed as good environmental stewards.
- Market leverage: Shippers dictate business trends in the goods movement marketplace; if they demand greater efficiency and better environmental performance, carriers and other logistics service providers will respond.
There are five steps your company can take to accelerate the transition to greener freight:
- Commit: Establish net-zero climate goals and greenhouse gas (GHG) reduction targets specifically for transportation-related emissions. This can help build credibility and support your company’s efforts to seek out zero-emission trucking solutions within its value chain operations.
- Disclose: Your company can’t manage what it can’t measure. Work with your supply chain partners to report progress on yearly emissions from vendors. These should be part of a broader disclosure of transportation emissions broken down by freight modes as applicable to the company and its operations.
- Plan: Identify near and longer-term options to optimize logistics operations and work with transportation suppliers to develop a plan to reduce emissions. Long-term commitments to working with low- and zero-emissions solution providers will instill confidence to carriers to scale their emissions reduction activities. Your plan of action should include three core planks:
- Get the most of our every move by focusing on increase the capacity utilization of existing freight moves
- Choose the most carbon-efficient mode of transportation, such as looking for opportunities to move goods from truck to rail
- Demand cleaner equipment, such as the use of electric trucks, from your carriers.
- Deploy: Your company has a critical role to play in the transition to zero-emission freight movement. Near-term leadership is needed to develop the processes and solutions for making a transition to zero-emission trucks. For example, your company can work with its carriers to establish solutions such as charging infrastructure for electric trucks.
- Advocate: Scaling zero-emission freight solutions will require that we establish the conditions in which these solutions can thrive. Public policy has a critical role to play in creating these conditions. Protective emission standards and market targets, such as the Advanced Clean Truck Program and the EPA Phase 3 GHG standards, ensure that fleets and shippers have access to zero-emission options. Purchase incentives and tax credits, such as those contained in the Inflation Reduction Act reduce the upfront investments companies must make and help scale these solutions.
Reduce Employee Travel Emissions
The other key source of Scope 3 transport emissions that your company can address is passenger travel. While video conferencing has reduced some commuting and business travel, these activities continue to have a significant carbon footprint. Business travel emissions are predominately a result of air travel, while emissions from employee commutes are more likely to be associated with road and rail modes.
There are a number of actions your company can take to reduce its value chain passenger transport emissions, including:
- Transparent measurement and disclosure: The first step to reducing passenger transport emissions is developing reporting protocols that measure and disclose emissions associated with business travel and commuting. Learning from companies who have begun tracking their Scope 3 passenger travel emissions and setting science-based targets is a useful starting point.2
- Avoiding unnecessary travel: Formal sustainable business policies and programs that include actions like ‘no-travel’ days and carbon levies can reduce overall miles traveled and carbon emitted, so can a company culture that supports virtual meetings and working from home.
- Encouraging employee use of sustainable modes: Company programs that support low- and zero-emissions transport modes such rail and cycling can reduce commuting emissions, as can the provision of end-of-trip facilities and bicycle storage on company premises.
- Prioritizing transport providers that are working to reduce emissions: Many transport companies such as airlines and ridesharing companies are setting net zero emissions targets, implementing emissions reduction actions, and investing in necessary innovation. Choosing leading companies as preferred service providers will reduce your Scope 3 emissions over time and send a demand signal to the market, driving further progress.
- Purchasing carbon offsets for travel that can’t be avoided: Some business travel is necessary, and for modes such as air travel there aren’t yet zero emissions options. Purchasing high quality carbon offsets for these trips manages your Scope 3 emissions in the meantime, and showcases your company’s commitment to climate progress.