Article title sound boring? Perhaps a little – but just look at what you will learn:
- How Carbon Footprints are calculated
- Why Private Fleets have a huge Carbon Footprint disadvantage
- Why SmartWay midpoint reporting is not a trucking company’s Carbon Footprint
Carbon Footprint. What is it? Why is it important? What does it have to do with trucking?
Let’s begin with the “what”. Carbon Footprint is a measure of a company’s carbon dioxide emissions (CO2), usually over a one-year period. That may sound simple, but unfortunately, it is not. The problem with taking inventory of CO2 has to do with ‘ownership’ of the emissions. For example, think of Company X that manufactures a single product. CO2 associated with manufacturing that product is generated when raw materials are mined, when they are shipped to the factory, when the product is assembled and throughout the supply chain used to deliver that product to market. How much of those emissions are owned by Company X?
Because of the complexity of assigning emission ownership, a worldwide standard was developed called the Greenhouse Gas Protocol. Here is how it works:
Emissions are categorized by source: Direct and Indirect. Direct emissions are emissions from sources owned or controlled by a specific company. Indirect emissions are emissions that are a consequence of the activities of a specific company, but occur at sources owned or controlled by another entity.
Additionally, emissions are further divided into three categories called Scopes. Scope 1 emissions include all direct CO2 emissions such as the burning of fuel in trucks owned or operated by a trucking company. Scope 2 emissions include Indirect CO2 emissions from consumption of purchased electricity, heat or steam. Scope 3 emissions are all other indirect emissions, such as the production of purchased materials and fuels, transport-related activities in vehicles not owned or controlled by the reporting entity, outsourced activities, etc…
The term Carbon Footprint commonly refers to a company’s Scope 1 and Scope 2 carbon dioxide emissions. Now here’s where it gets interesting...
A for-hire trucking company’s Carbon Footprint includes combined CO2 emissions from fleet operations and facility operations. Fleet emissions come from the burning of fuels. Facility emissions come from energy used at the facilities (to heat, cool, light facilities) along with fuel burned in service vehicles. To a shipper using a for-hire carrier, the emissions from that carrier are Scope 3 emissions and therefore not part of that shipper’s Carbon Footprint.
However, for private fleets owned by manufacturers/shippers, transport activities associated with that fleet are part of their Carbon Footprint because they own/control the fleet. Private fleets therefore impose a large carbon ownership responsibility on the shippers that own/control them.
Back to our definition of Trucking’s Carbon Footprint – it includes both fleet (scope 1) and facility (scope 2) carbon dioxide emissions. Therefore, the midpoint CO2 fleet emissions calculated and reported by EPA’s SmartWay Transport Program is not a true Carbon Footprint. SmartWay does perform a greenhouse gas compliant calculation of fleet emissions. It is generated when carriers complete their annual fleet model worksheets. They do not however collect and calculate facility emissions which increases an average trucking company’s Carbon Footprint by 10-40%. SmartWay has been very successful in providing fleet emission reporting and carbon reduction strategies to the industry and that was and remains their mission. It was never SmartWay’s intent to provide full Carbon Footprint reporting but it is important that trucking industry executives understand the difference when discussing Carbon Footprints with their shippers.
Next Week - Why a Trucking Company’s Carbon Footprint is Important.
Recommend Viewing: Supply chain CO2 is increasingly becoming a concern of shippers. The following video provides a comprehensive overview of What Trucking Executives Need to Know about Carbon Dioxide Emissions.