Optimise transportation of purchased goods (inputs) and final products (outputs) - INTERMEDIATE

Cost
LOW
Cost
MEDIUM
Cost
HIGH
EFFORT
low
EFFORT
medium
EFFORT
HIGH
IMPACT
low
IMPACT
MEDIUM
IMPACT
HIGH

There is one area of immediate opportunity that organisations can leverage for CO2 reduction: operational efficiency in transport. Operational efficiency is usually aligned to cost reduction. Adding CO2 impact to the decision-making process can lead to real reduction opportunities.  

Three of the main areas of focus around efficiency are Mode, Fill, and Fuel:

  • MODE: Achieving an optimal mix of modes used is probably the biggest opportunity especially if there is high reliance on air freight. Air freight can easily generate 50 times or more CO2 per tonne shipped than ocean freight.  The optimal mode of transport needs to be assessed, with the idea being to shift to lower CO2 modes where possible, such as air to sea or road to rail. In addition, looking at multimodal solutions, such as air-sea solutions for intercontinental shipments, can reduce CO2 and costs, with medium lead-times.
  • FILL: Increasing the utilisation of cargo, usually more targeted at ocean and road freight. The goal here is to maintain high capacity-utilisation of containers and trucks (optimising loads in terms of weight and volume, possibly partnering with complementary products) and to minimise empty miles (e.g. empty return trips). This can have a significant impact on CO2 through reduced use of assets resulting in fewer kilometres travelled. Shifting from owned fleet to transportation providers often helps optimise loads and routes to reduce overall carbon emissions.
  • FUEL: Increasing fuel-efficiency, primarily applicable to road freight. As the goal here is to continually improve the overall fuel efficiency of the fleet, through asset renewal programmes to ensure compliance with the latest emission standards, route optimisation through a TMS (Transport Management System), driver training programmes, fuel loyalty programmes with companies investing in green energy or carbon offsetting, or other initiatives.

8 Giga tons of CO2

are emitted each year by the transport sector globally.
(statista)

46%

of the transport sector emissions are related to the sole transportation of goods (road, sea, air and rail).
(statista)

ADDITIONAL RESOURCES

The very basic formula for calculating CO2 related to transportation is a (weight * distance * CO2 emissions factor) calculation. This is important to remember as any of these three parameters can be drivers on the CO2 reduction journey.

Here is a carbon calculator for logistics.