Tag Archives: sustainable shipping

5 Effects of Green Shipping Regulations

Medium- and heavy-duty trucks move about 70% of America’s freight. These vehicles make up about 5% of traffic and contribute 20% ofgreen-sustainability.jpg greenhouse gas (GHG) emissions and oil consumption in the transportation sector. This makes trucking firms a prime target for green initiatives. In the past few years, the government has created regulations to reduce GHG emissions and support green shipping.

High-Level Regulations

In 2015, the EPA and the NHTSA released an emissions and fuel consumption reduction plan in response to President Obama’s Climate Action Plan. This plan consists of 2 phases.

Phase 1 targets truck engines and emissions in model years 2014 to 2018. This part of the program has been a success, cutting carbon emissions and reducing petroleum use. Phase 2 takes effect beginning with the model year 2021 (2018 for trailers) until the model year 2027 trucks and expands the plan’s scope to include trailers and glider vehicles.

Phase 2 is estimated to reduce GHG emissions by 1 billion metric tons, save 75 billion gallons of fuel and save vehicle owners $170 billion over the vehicle’s lifetime. Whether you believe these numbers to be optimistic or not, shippers need to pay attention to these regulations as they will have a profound impact on the transportation industry.

Regulations that impact trucking companies will inevitably impact shippers’ transportation costs, operations, and strategy.

Here are 5 reasons why shippers should pay attention to GHG trucking regulations:

Fuel Costs

Fuel comprises a major portion of operating costs for trucking companies. The EPA estimates the costs of Phase 2 vehicles, due to their improved fuel economy, will be recouped by vehicle-owners within two years. This means smaller, lower risk investments and big fuel savings for trucking companies. Improved fuel economy means reduced transportation spend for shippers.

Carbon Taxes

New, fuel-efficient vehicles will emit less GHGs than current vehicles, which will lead to further savings for carriers and for shippers. Carbon taxes are already being implemented in most major countries as well as in parts of the U.S. They are slowly gaining popularity for their effectiveness. Consequently, the entire fuel-intensive trucking industry will be taxed for carbon output in the near future. Presumably, phase 2 trucks will reduce emissions and help shippers avoid inflated transportation costs.

Freight Flow

Fuel-efficient vehicles and aerodynamic trailers stop less for fuel, which increases the speed of transport. Also, these vehicles are more reliable than existing equipment, which means fewer break-downs, service requirements and overall disruptions for carriers. Shippers will get their freight moving faster and more reliably. Otherwise, if new equipment investment proves to be a heavy burden for carriers, or if they’re hit unpredictably hard by carbon taxes – rail transport would become much more common because it is typically less expensive and more fuel efficient.

Equipment Investments

Phase 1 and Phase 2 significantly impact the timing of equipment investments for carriers. Whether they are financially ready to invest or not, they have to buy new trucks and trailers to meet government standards or face harsh consequences. The investment in Phase 2 vehicles could potentially provide great benefits. However, the investment itself could cause undue strain on profit margins for trucking companies. It’s impossible to tell what economic conditions will be like. So, carriers could feel the need to raise costs to keep profits steady, which would lead to higher costs for shippers.

Consumer Approval

Demanding consumers want their products fast, cheap and they want to receive them in a responsible way. Sustainability in the supply chain is important for consumer approval. As a shipper, you hold responsibility for being a high emitter of carbon and consumer of fuel. Approval from the end consumer can greatly affect the bottom line.

The potential benefits of the EPA and NHTSA’s Phase 2 green shipping regulations are undeniable. However, the benefits won’t be immediate, and carriers will have to take a financial leap to meet the standards. Ultimately, the cost savings and environmental benefits should quickly outweigh the downsides of the regulations. But, either way, shippers will feel trucking regulations too. Finally, green shipping definitely has a future.

Keep reading: Market Update: 2016 – 2017 Trucking Regulations May Aggravate Economic Trends.

The EPAs Green Transportation Initiative

green transportationThe SmartWay Transport Partnership, launched in 2004, is an innovative green transportation initiative between the U.S. Environmental Protection Agency (EPA) and the freight industry, designed to reduce greenhouse gases, non-renewable resource consumption, and transportation costs.

The program is an initiative to voluntarily reduce environmental impacts from freight transportation. Participating companies, with the help of SmartWay, use EPA-tested tools to assess their current freight operations and identify technologies and strategies to reduce their carbon emissions.

What does the SmartWay do?

SmartWay partners demonstrate to customers, clients, and investors that they are taking responsibility for their emissions. Also, they are committed to corporate responsibility, sustainable business practices and reducing their carbon footprint.

Since 2004, SmartWay Transport Partners have:

  • Saved $16.8 billion dollars in fuel costs
  • Saved 120.7 million barrels of oil (the equivalent of taking over 10 million cars off the road for an entire year)
  • Reduced CO2 emissions by 51.6 million metric tons
  • Reduced NOx emissions by 738,000 tons
  • Eliminated 37,000 tons of particulate matter

Carriers, shippers and 3PLs have a lot to gain from joining the SmartWay Partnership.  Participants not only reduce their environmental impact but save money on transportation while doing so.  Additionally, program-qualified tractor trailers can save between 2,000 and 4,000 gallons of diesel per year.

How can you support green transportation initiatives?

Buyers and consumers are taking environmental impact into consideration when purchasing goods.  People notice when a company starts to get serious about “Green” initiatives, especially in a pollution-heavy industry like transportation.  A company that reduces its carbon footprint shows that they care about the community they are involved in and will take great lengths to satisfy customer desires.

PLS contributes to SmartWay’s goal of reducing emissions of carbon dioxide, nitrogen oxides, particulate matter, and non-renewable resource consumption. Also, we accomplish this goal by working directly with our freight carriers to consistently improve their environmental performance.

We believe it is our social responsibility to help reduce transportation pollution by initiating conscientious practices with our business partners through green transportation. Finally, it is our goal every day to help our customers achieve the most cost and fuel effective methods for moving their products.

Continue Reading, “Supply Chain Disruption – 3 Future Solutions”

Sustainable Freight Shipping

sustainable freight shippingWould you be willing to pay 5% higher prices for products ordered online if they are shipped sustainably?

A recent survey titled “Need for Green or Need for Speed” Survey conducted by the consulting firm West Monroe Partners revealed that 54% of e-commerce consumers are willing to pay the extra money.

The study also revealed that consumers were not aware that sustainable freight shipping options were available to them. This study made me think not only about how I personally have my e-commerce products shipped but on a larger scale, how the businesses that I frequently do business with are doing their part to be more environmentally friendly.

How Does Sustainable Freight Shipping Work?

Large and small trucking companies, rail carriers, logistics companies, commercial manufacturers, retailers, and other federal and state agencies can partner with the Environmental Protection Agency (EPA) in their SmartWay Partnership program. This program is a public-private initiative designed to increase energy efficiency while significantly reducing greenhouse gases and air pollution.

The EPA’s SmartWay Transport Partnership is a government and industry collaboration to voluntarily achieve improved fuel efficiency and reduce environmental impacts from freight transport. Participating companies benchmark their current freight operations; identify technologies and strategies to reduce their carbon emissions, track emissions reductions and project future improvement. SmartWay partners demonstrate to customers, clients, and investors that they are taking responsibility for the emissions associated with goods movement, are committed to corporate social responsibility and sustainable business practices and are reducing their carbon footprint.

PLS and Sustainable Freight Shipping

PLS Logistics Services does our part in contributing to the SmartWay Partnership’s goal of reducing emissions of carbon dioxide, nitrogen oxides, and air-polluting particle matter. This goal is accomplished by working directly with our freight carriers to consistently improve their environmental performance.

PLS is committed to helping the SmartWay Transport Partnership achieve this goal. We believe it is our social responsibility to help reduce transportation pollution by initiating conscientious practices with our freight carriers. It is our goal every day to help our customers achieve the most cost and fuel effective methods for moving their products.

There are many ways that consumers and business alike can be more environmentally-friendly and a good start is to work with companies that are part of the SmartWay program.


 

Interesting facts about the Transport Partnership:

  • Over 3,000 partners
  • $16.8 billion dollars in fuel costs saved
  • Save 120.7 million barrels of oil (the equivalent of taking over 10 million cars off the road for an entire year).
  • 51.6 million metric tons of CO2 reductions
  • 738,000 tons of NOx reductions
  • 37,000 tons of PM reductions

(These facts were reported by the SmartWay Highlights document, dated February 2013, and listed on the SmartWay’s website).


 

SmartWay is more than the Transport Partnership described above, it consists of three additional components:

  • SmartWay Technology Program: A testing, verification and designation program to help freight companies identify equipment, technologies, and strategies that save fuel and lower emissions.
  • SmartWay Vehicles: A program that ranks light-duty cars and small trucks and identifies superior environmental performers with the SmartWay logo.
  • SmartWay International Interests: Guidance and resources for countries seeking to develop freight sustainability programs modeled after SmartWay.

 


 

To learn more about SmartWay Partnership Program, visit http://www.epa.gov/smartway/

To read more of the “Need for Green or Need for Speed” survey, visit: http://www.westmonroepartners.com/en/insights/white-papers/need-for-green-survey