By Dr. Beatriz Royo, Research Fellow at the MIT-Zaragoza International Logistics Program.
It is a truism that “you can’t control what you can’t measure”. The freight and logistics sector accounts for some 7% of global carbon emissions. If business trends continue, this figure could soar, whereas it needs to be dramatically reduced. Retailers, manufacturers, shippers and carriers need to be able to measure and understand their carbon (and other) emissions, both to drive sustainability and to improve their efficiency, while public authorities need to understand the sources of carbon emissions if they are to plan ameliorative policies and regulations.
Many companies attempt to quantify their emissions, but there are problems. Standards agencies, industry bodies and governments have provided advice on how the calculation should be done and the results reported. Unfortunately, their efforts were not co-ordinated and the resulting proliferation of methods, calculators, standards and emission factors left managers unsure which to adopt(see A. McKinnon, 2018: Decarbonizing logistics). Without a consistent approach and an end-to-end accounting, it is difficult to include emissions meaningfully in the range of factors – cost, time, reliability, safety – that should inform logistics decision-making.
ZLC is contributing to two projects, now two years into their three year lifespan and funded from the EU Horizon 2020 budget, that address these issues.
On the one hand, the LEARN project, or “Logistics Emission Accounting and Reduction Network” has the overall goal of establishing coordinated networks of industry, government and civil society stakeholders and building on existing initiatives to drive consistent and transparent emissions measurement and reporting across all the global logistics supply chain. It seeks to bring together and harmonise the several valuable methodologies that have already been developed, not least under the Global Logistics Council (GLEC) Framework, and to bridge the gaps identified such as reducing data uncertainty.
The challenge for LEARN is not just about creating a common methodology and improving data accuracy. The project has to address the evident lack of knowledge in the logistics community around collecting and calculating emissions data, certifying and setting reduction targets. This is as much as anything an education and training problem both for logistics users and providers, and also for those who develop relevant systems and software and need to understand how freight works in the real world. A first draft of a complete carbon emission calculation, reporting and verification educational programme is currently being reviewed and refined using feedback from stakeholders gained through webinars and face to face workshops.
On the other hand, the SELIS project, or “Shared Europeans Logistics Intelligent and Information Space” aims to facilitate a new generation of collaborative, responsive, agile, and green transportation chains. Solutions need to be ‘lightweight’ in the sense that they are neither too expensive nor too complex to be used by the whole range of logistics players, many of whom may be quite small. The platform would also need to protect the commercial confidentiality of the data it is handling. The solution would appear to lie in the creation of independent, third party, intermediaries or data warehouses that can collect, collate, calculate and communicate data from all parties reliably, privately and securely. For any given supply chain or logistics community, there is a need for a secure infrastructure over which both information and tools can be shared under some form of co-operation agreement.
SELIS is exploring the use of the latest ICT technologies such as publish/subscribe, cloud computing, big data analytics and aspects of artificial intelligence and machine learning. ZLC is coordinating the work of the eight demonstrators or ‘Living Labs’ and leading three of the seven project strategies, which includes work on supply chain finance, the collaboration between retailers and suppliers and the development of a carbon toolbox. Regarding the latter, SELIS and LEARN are cooperating to face one of the carbon accounting challenges, that of reliably and securely collecting, exchanging and communicating this data, within a given supply chain. Accounting for carbon emissions is only a start – it only has real value if the information can be used continually to optimise performance in what is often a fast-changing network with many variable factors. Decision makers at all levels need to be able to see the current performance and work out the beneficial or detrimental effects of changes and alternatives. That means that data has to be collected, verified, processed and published according to commonly used methodologies, but without impeding confidentiality and competition. Unlike some current approaches, which estimates the fuel used as well as detailed modelling data such as the real distance, amount of freight, type of route and so on, the new toolset will use real, not default or estimated data on fuel consumption. Two Living Labs, an urban logistics service provider in Brussels, and a German inland waterway service provider, are the demonstrators that will test the solution designed by SELIS with the support of LEARN and based on the GLEC Framework.
Looking forward to the results in producing more representative and accurate data to encourage businesses in incorporating and measuring green efforts to mitigate climate change.