Challenges of reducing Carbon Emissions in the transportation industry

The climate crisis is one of the most urgent problems we face today. Even under current policies, temperatures are expected to increase even further than the 1℃ increase since the pre-industrial period. 

Why do we need to reduce carbon emissions? Carbon emissions remain in the atmosphere for 100 years, and up to 80% of these dissolves into the ocean over 20 – 200 years. The crisis not only has impacts on the environment and human wellbeing but also on the economy. Evidence shows that reducing carbon emissions will benefit the economy too.

Across the different human activities, transport represents the leading cause of air pollution in cities. Within the sector, international aviation, international maritime industries, and road transportations contribute the most to the overall emissions.

Several policies have been made to reduce the sector’s emissions; however, controversial arguments define the line between what is achievable, and the level of commitments requested from each operator. 

The trucking industry may be significantly impacted by new regulations proposed by the Securities and Exchange Commission (SEC) in March of last year regarding the disclosure of climate-related risks and greenhouse gas emissions.

According to the proposed regulations, SEC registrants would have to provide details regarding scope 1 (direct), scope 2 (indirect), and scope 3 (supply chain) greenhouse gas emissions. Scope 3 emissions, which are difficult to measure, may disproportionately impact smaller carriers with fewer resources than large publicly traded corporations. 

One of the primary measures to reduce road transport emissions is the use of electric vehicles, which has been one of the main focuses of the COP26 programme.

Nevertheless, the life-cycle emissions of electric vehicles depend highly on materials, batteries, and electricity. Even if all future vehicles were electric, it would still take 15 to 20 years to replace all current vehicles that run on fossil fuels.

Also, in January next year, the International Maritime Organization (IMO) is introducing a Carbon Intensity Indicator (CII) that will rate cargo vessels that are above 5,000 gross tons (GT) and trade internationally. 

The IMO will evaluate vessels according to their operational output of greenhouse gases, and individual vessels will be rated on a scale from A to E based on size, utilisation, and speed. 

Further ahead, the IMO is regulating a target of zero emissions by 2050, and maritime transport companies are trying to determine the best fuel and propulsion options to invest in.

Until the industry finds the correct formula for zero-emission fuel and propulsion, at the current knowledge, it means a slower steaming. There are various alternatives from biofuels, LNG and methanol, and companies are investing in trialling vessels that combine dual fuels with battery-electric drives. Choosing the right option is a more pressing problem when one realises that investing in a cargo vessel is a 25–30-year commitment and has a price tag of around $80m.

Regarding the aviation sector, there are still limitations of practical “jet zero” technology over greater distances. Middle- to long-distance air transport is difficult to decarbonise, and zero carbon aviation fuels and electric aircraft are neither proven nor scalable to the degree required for a rapid reduction in aviation emissions.

Air freight operates in a worldwide market, similar to maritime, which makes governing and regulating them challenging. However, the industry has an opportunity to cut emissions by combining retrofitting with zero-carbon fuels and advanced technology.

Despite all the trials and investments, there are uncapped best practices that would still require government commitments toward the industry and vice versa. To achieve economic growth, while still prioritising the reduction of carbon emissions, a variety of actions can be taken and must be taken. 

Ti’s proprietary data from a survey on corporate environmental initiatives showed that respondents have also recognised that more effort and a broad range of initiatives must be expended to reduce emissions. More information can be found in the Logistics & Supply Chain Sustainability Report published in 2021.

It is currently unclear how best to reduce emissions and adopt sustainable and efficient logistics networks. However, it is imperative to consider a way to avoid a negative impact on the transport sector, the small carriers, and the supply chain already in distress while boosting the actions on reducing carbon emissions.

Source: Transport Intelligence, 4th of August 2022

Author: Marta Chiriatti