How Shippers Use Carbon Emissions Shipment Data to Reduce Total Carbon Footprint

It's a common goal for people and industries worldwide to work together to reduce our collective carbon footprint and counteract climate change. The shipping industry plays a significant part in this equation, as carbon emissions from shipping make up a substantial portion of the problem. Also, shipping is connected to every industry that sells goods or products.

Fortunately, this industry provides a ample opportunity to make a change. A shift to greener methods has already been happening, yet work is still to do. Shippers have a lot of power. When they track carbon emissions for each shipment, they can make better decisions on carriers and the best ways to optimize the logistics network to reduce emissions.

Shipping Emissions Statistics & The Impact Carbon Emissions from Shipping Have on the Climate

Annually, container ships contribute approximately one billion metric tons of carbon dioxide. This amount equates to about 3 percent of total greenhouse gas emissions on a global scale. Beyond ships, the transportation industry contains many other forms of transportation that contribute to carbon emissions. These include trucks, aircraft, trains, and others.

The EPA explains that this sector is a top U.S. greenhouse gas emissions contributor. In 2020, it was the top one, contributing 27 percent of emissions in the country. Note that these numbers include more than shipping and logistics; it encompasses the entire transportation sector. Broken down, most of the 2020 transportation sector emissions in the U.S. came from light-duty vehicles, at 57 percent, and medium- to heavy-duty trucks, at 26 percent. After that, aircraft accounted for 8 percent, an "other" category 5 percent, rail 2 percent, and ships and boats 2 percent.

Shipping is already responsible for a considerable portion of emissions globally. We are only experiencing an increase in e-commerce activity, peak season activity, and shipping. Projections based on current levels of growth show that shipping could be connected to 10 percent of greenhouse gas emissions worldwide by the year 2050.

These emissions and the emissions of black carbon by the shipping industry contribute to climate change. Shipping's main contributor is carbon dioxide; its second is black carbon from ships burning marine fuel. A reduction of emissions by the shipping industry does fall under the Paris Agreement, as it requires reducing all emissions economy-wide. The IMO agreed to a plan for the shipping sector to cut emissions by 50 percent or more by 2050. The industry is on its way through methods like carbon-neutral vessels, yet not enough work has been done so far.

Understanding Scope 1, 2, and 3 Emissions

To gain a better understanding of your emissions, you can track three types:

• Scope 1: These are emissions your company directly causes through assets and resources. You must report these. It includes stationary, mobile, fugitive, and process categories of emissions. Examples include vehicles, which are mobile emissions, and manufacturing, which fall under process emissions.
• Scope 2: These are indirect emissions related to your company's ownership. These need to be reported. They include energy sources your company purchased for its use, such as electric car refueling, electricity for the building, and similar types.
• Scope 3: These emissions are indirect and not owned by your company. You do not need to report these, but it is recommended to do so. Examples include transportation, waste generated by your company and items you bought for operations, to name a few. While this category is indirect and not mandatory to report, it tends to include most of your emissions and climate change impact.

Customers want to know more about the environmental impact of companies, and a large portion like to choose companies with sustainable practices. They are often willing to take steps like paying more and delaying shipping times when these steps are more eco-friendly. Following better practices on all scopes of emissions can not only help reduce your contribution to climate change but also put you in a good light with customers.

What Are the Nitrogen Oxides and the Control Regulations to Know?

Nitrogen oxides make up another type of emissions to be aware of and track. These are potent gases that react with volatile organic compounds (VOCs). These gases occur during fuel burning at high temperatures, like the energy used by vehicles, industrial boilers, power plants, etc.

Regulations designed to control nitrogen oxide emissions include:

• NOx Reasonably Available Control Technology (RACT): This regulation focuses on major stationary NOx sources using RACT to follow the Clean Air Act Amendments of 1990.
• Ozone Transport Region (OTR) NOx Cap and Allowance Trading Program: The OTR includes the Northeastern United States with Maryland, Delaware, Washington, D.C., and the top of Virginia. Controlled by the Ozone Transport Commission (OTC), it includes the region's NOx cap and trade regulations.
• EPA's Ozone Transport NOx SIP Call: A group that included the EPA, 37 Eastern states, Washington, D.C., environmental groups, and industry representatives worked together to establish ways to cut long-range transport of ozone and precursors to ozone. The EPA's related rulemaking, known as the NOx SIP Call, required certain parts of the region to create state implementation plans (SIPs) laying out budgets to cut NOx emissions.

How Do Shippers Use Carbon Emissions Shipment Data to Reduce Total Carbon Footprint?

Shippers must reduce their carbon footprint and help to control climate change. Fortunately, the sector can make this change. Big data can help to move us forward toward this goal. Big data in shipping helps by tracking and showing accurate, reliable information on associated carbon emissions.

While there are not strong regulations to cut emissions in shipping, and fossil fuels in this sector have tax incentives, other forces are pushing for change. Sharing big data publicly can drive customer actions and other significant changes. In addition, companies are looking for their shipping to reduce carbon. It also benefits companies to reduce the cost of offsetting emissions by saving on them. More companies and consumers are making choices based on green shipping, so the shipping sector will need to respond to work with these companies. People, companies, and governments are looking at the shipping industry's steps taken to control carbon emissions. Potential solutions include steps like electric vessels and small consumer product price increases.

Big data comes into play because it shares the environmental information of each shipper. You gain details like shipping CO2 emissions and nitrogen oxide emissions. This shipping data could incorporate carbon emissions into negotiations and trade deals. In addition to EEOI and EEDI data, we could look at the daily emissions of each vessel and the type of transport by one large vessel or two small ones. AI can collect and analyze emissions data to help move the industry forward.

Let's look at a few strategic examples of data helping impact carbon emissions in the sector. Freight brokers can use fuel or freight lane information to reduce carbon emissions. In addition, an integrated tech stack within supply chain systems gives more visibility into carbon emissions, broken down by meaningful information to help you find areas for improvement.

The Carbon Emissions Shipping Data to Inform Shippers from Intelligent Audit

As a shipper, you can rely on tools and partners to support you in collecting and providing accurate and meaningful emissions data. Intelligent Audit, along with other data visibility related to shipping activity, provides the following information so shippers may identify areas and make better decisions to reduce their carbon emissions:

• Grams CO2 per package = (weight of the package in tons) x (miles) x (grams CO2 per ton-mile)
• Grams NOx per package = (weight of the package in tons) x (miles) x (grams NOx per ton-mile)
• CO2 per ton-mile and NOx per ton-mile are stored in a table by carrier and mode
• For example, UPS Multimodal is 112.5 g CO2 per ton-mile and 0.9 g NOx per ton-mile

This kind of information can aid you in making decisions to reduce your total shipping carbon footprints, such as choosing lanes and carriers.

Be On the Forefront of Reducing Shipping Emissions

The shipping industry is a major player in carbon emissions that contribute to climate change. While there are good intentions to make a change and small shifts are happening, it is not enough to curb this problem. By focusing on your shipping emissions and using data to support visibility and decision-making, you can stay at the forefront of moving the sector forward and helping the environment, which only helps your reputation and the willingness of businesses and customers to choose your shipping services.

Learn more about reducing your emissions and shipping carbon footprint at Intelligent Audit.