SUPPLY CHAIN DECARBONIZATION
THE ROLE OF LOGISTICS AND TRANSPORT IN REDUCING SUPPLY CHAIN CARBON EMISSIONS
Report prepared with the support of Accenture
Supply Chain Decarbonization was produced in January 2009 by the World Economic Forum, within the framework of the Logistics and Transport Partnership Programme. The significant contribution of Accenture is gratefully acknowledged.
World Economic Forum Geneva Copyright © 2009
Sean Doherty Associate Director Head of Logistics & Transport Industry Group World Economic Forum Seb Hoyle Manager Sustainable Supply Chain Accenture
Rod Franklin Vice President, Product Development Kuehne & Nagel Edgar Uribe Lead, Corporate Environment Activities Kuehne & Nagel David Simchi-Levi Co-Director, Supply Chain Innovation Forum Massachusetts Institute of Technology Yossi Sheffi Professor of Engineering Systems Massachusetts Institute of Technology Lynsey MacIver Head of Environment Panalpina Toon Tessier Chief Advisor Environmental Policy Port of Antwerp Johan Roos Director, Environment Stena AB Rob Rijk Environmental Manager TNT Ruben van Doorn Manager, CEOs Office TNT David Guernsey Senior Sustainability Program Manager UPS Mark van der Horst Director EU Affairs UPS
Narendra Mulani Partner Global Head of Supply Chain Management Accenture
Christopher Logan Head of Strategy (Global) Agility Samuel Sidiqi Director of Strategy (Europe) Agility
Supply Chain Decarbonization
Raji Hattar Chief Projects Officer Aramex International Adrian Dickinson Scientific Adviser DHL Neutral Services Martin Anderson Global Director of Safety & Environment DP World Charles Haine Manager, Global Environment, GSE DP World Winfried Haeser Director, Environmental Reporting and Policy DPWN
Any errors in this review are the responsibility of the authors. The views expressed are not necessarily those of the consultative group, the World Economic Forum or its partner companies. 2
Patrick Browne Sustainability Program Manager UPS Antonia Gawel GHG Protocol WBCSD Andrea Brown GHG Protocol WBCSD
John Moavenzadeh Senior Director, Head of Sustainable Mobility World Economic Forum Randall Krantz Associate Director, Environment Initiatives World Economic Forum
Supply Chain Decarbonization
Significant movement is expected towards reduced supply chain carbon intensity. This will create both opportunities and risks for logistics and transport firms, with changes in supply and demand driven by: Regulation of carbon emissions Higher and more volatile fuel prices Evolving consumer and client demand The sector can play an influential role in decarbonization, both in its own operations and through broader supply chain optimisation. This provides direct benefits through reduced costs, managed risks and business growth.
Around 60% of this potential carbon abatement originates from the sector‟s own emissions. Others come from the broader supply chain and can be achieved through changed logistics and transport configurations: Supply Chain Decarbonization Opportunities Clean Vehicle Technologies Despeeding the Supply Chain Enabling Low Carbon Sourcing: Agriculture Optimised Networks Energy Efficient Buildings Packaging Design Initiatives Enabling Low Carbon Sourcing: Manufacturing Training and Communication Modal Switches Reverse Logistics / Recycling Nearshoring Increased Home Delivery Reducing Congestion Potential Abatement Mt CO2e 175 171 178 124 93 132 152 117 115 84 5 17 26 Assessed Index of Feasibility High High Medium High High High Medium Medium Medium Medium Medium Medium Low
Human activity generates annual greenhouse gas emissions of around 50,000 mega-tonnes CO2e. We estimate that 2,800 mega-tonnes – or 5.5% of the total – are contributed by the logistics and transport sector. GHG Emissions (mega-tonnes CO2e per year) 3,000 2,500 2,000 1,500 1,000 500 0 Logistics and Transport Activity Rail Freight...
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