Are you a logistics or transport company looking to reduce your carbon footprint? Are you struggling to meet client demands for emissions data? Or are you a shipper who is simply trying to figure out how to calculate your CO2 transport emissions?
Whatever the reason you’re looking to track your emissions, our 5-step guide will help you calculate CO2 emissions for your transport and logistics operations.
How to calculate transport CO2 emissions
Before we dive into the nuances of calculating CO2 emissions for transport and logistics operations, here is a summary of the 5 steps to get started:
- Determine which types of emissions to track
- Select a calculation methodology (and ensure it complies with ISO 14083)
- Collect transport and fuel data
- Calculate carbon emissions per shipment using the following formula:
CO₂ Emissions=Quantity of fuel × Emission Factor per quantity of fuel - Consolidate and report on emissions data
While it’s possible to do all of the above manually, it’ll take you days of work and cause a lot of stress. Plus, it’s unlikely to result in accurate emissions data. That’s why many logistics and transport companies are instead using carbon accounting software to easily and accurately calculate, analyze, and report on their Scope 1,2 and 3 emissions.
What are Scope 1, Scope 2, and Scope 3 emissions?
Whether you’re shipper, carrier, or LSP, before you start calculating emissions it’s important to understand the three main types of emissions.
Scope 1 emissions are direct emissions from sources that the company owns or controls. Examples include emissions from fuel used by their transport fleet and gases released from refrigerants in commercial cooling equipment like air conditioners and refrigerators.
Scope 2 emissions are indirect emissions from the consumption of purchased electricity, steam, heat, and cooling i.e. energy that is generated off-site. Examples of scope 2 emissions include emissions from electricity used by your office buildings and warehouses.
Scope 3 emissions are all emissions that are not produced by the company’s assets or the activities it controls, but that the company is indirectly responsible for up and down its value chain. Examples of scope 3 emissions include emissions from business travel, waste disposal, and emissions from purchased goods and services.
In recent years, there has also been some talk of introducing Scope 4 emissions to the Greenhouse Gas Protocol (GHGP). The idea behind scope 4 is to inspire innovation in supply chains, by providing a framework for companies to calculate emissions that are avoided through R&D innovations. Since scope 4 emissions are still in the early days, we’ll focus on scope 1, 2, and 3 emissions in this article.
5 steps to calculating CO2 emissions for transport and logistics companies
Now that you understand the main types of emissions, you can get started with calculating emissions for your operations. Here are the 5 main steps:
1. Determine which types of emissions to track
Before you start doing any calculations, you need to understand exactly which emissions are relevant for your company. This involves assessing your entire value chain to figure out the emissions you directly emit (Scope 1), the emissions that are emitted due to the energy you use (Scope 2), and all other emissions you indirectly emit through your value chain activities (Scope 3).
You can do this by mapping out your value chain and listing potential Scope 1, 2, and 3 emissions from activities at each stage. This is also useful to see which activities are likely to be responsible for the majority of your emissions. Examples of activities for transport and logistics companies include:
- Transportation of client’s goods
- Purchase of transport vehicles and vessels
- Purchase of machinery and equipment
- Electricity for office buildings and storage facilities
- Business travel
- Employee commutes
2. Select a calculation methodology
Once you’ve mapped the emissions types for every stage of your value chain, you need to choose a tried-and-tested methodology for calculating emissions. You can choose between spend-based, activity-based, and hybrid calculation methodologies.
- Spend-based methodologies use data on the amount of money paid to your supply chain partners for certain goods and services, multiplied by an emissions factor.
- Activity-based methodologies use data on how many units of a good or a material (e.g. liters of fuel or kg of material), multiplied by the emissions factor.
- Hybrid methodologies: for the most accurate emissions calculation, the GHGP recommends choosing a hybrid calculation methodology that primarily uses activity data, but supplements it with spend-based data where activity data isn’t sufficient.
As you’ll see, all of these methodologies require you to use an emissions factor. Not sure what an emissions factor is? Well, according to the European Environment Agency’s definition, an emissions factor is “the estimated average emission rate of a given pollutant for a given source, relative to units of activity”.
Emissions factors essentially quantify the amount of GHG emissions produced per unit of activity, such as fuel consumption, distance traveled, or freight weight. It is typically expressed in terms of CO₂ emissions per kilometer, per liter of fuel, or per ton of transported goods.
While the emissions factor you use is up to each individual company, make sure that you’re using emissions factors from a reputable source like the GLEC Framework, CO2Emissiefactoren (NL), DEFRA (UK), EPA (US), or IPCC.
For logistics companies, we recommend using the GLEC Framework as your emissions calculation methodology and source of emissions factors. Most carbon accounting calculators and software are based on the GLEC framework (but more on that later!).
3. Collect transport data
No matter which calculation methodology you choose, you’ll need to collect data from each activity and asset in your value chain, such as company vehicles (owned and leased), transportation journeys, purchased electricity, steam, heating and cooling, business travel, and more.
However, your calculation methodology will determine exactly which data points you’ll need to collect. For spend-based methodologies, you’ll need to collect data on the amount of money paid to your supply chain partners for certain goods and services.
Whereas for activity-based methodologies, you’ll need data on how many liters of fuels and how many kg of each material were purchased.
As you can imagine, this can take a lot of hours to collect from hundreds of different sources unless you have a way to automatically collect and standardize the data. That’s where carbon accounting software comes in—automatically pulling and consolidating data from across your activities into one easy-to-use platform.
4. Calculate carbon emissions by transport type
Now that you’ve determined which emissions to measure, decided on your calculation methodology, and figured out how to collect the data, the next step is to calculate the carbon emissions.
We’ve already shared some simple calculation methodologies, but it’s much easier to understand how this works if you see the calculation in action. So here’s an example of how to calculate the emissions of a diesel truck using an activity-based methodology:
The formula is CO₂ Emissions = Quantity of fuel × Emission Factor per quantity of fuel type
Let’s assume a truck leaves its depot in the suburbs of Amsterdam, collects a container at Schipol Airport, and makes 3 deliveries in Rotterdam. The total kilometers traveled will be 139 km.
Depot → Schiphol Airport 9 km
Schiphol Airport → Rotterdam 59 km
Rotterdam → 3 deliveries 12 km
Return to depot 59 km
= 139 km
The average consumption of diesel trucks is 0.30 liters of diesel per km, so this journey will use approximately 41.7 liters of diesel.
Based on the GLEC Framework, the CO₂ emission factor for B7 diesel in Europe is 3.31 kg CO₂e per liter.
So the total emissions from this journey is:
41.7 liters of Diesel x 3.31 KG CO2e per liter = 138.03 kg CO₂e
The total emissions can then be allocated over the individual deliveries, based on their share of total transport activity. The transport activity is the distance for a shipment from origin to destination multiplied by the weight. In this example we assume that the weight of each delivery is the same, meaning that each delivery has emissions of 46.01 KG CO2e (the total emissions from the journey divided by 3).
This is a simplified example but it shows you how to calculate transport emissions for a truck for a one-day period. You can simply repeat this calculation for other journeys, but don’t forget to use a suitable Emission Factor for the transport mode and your region.
5. Consolidate and report on emissions data
The final step is to consolidate all of your emissions calculations to determine the total emissions for your company. While the calculation itself is straightforward, consolidating emissions data for thousands of journeys, multiple transport modes (road, ocean freight, air, etc.), and other types of emissions can involve hundreds of complex Excel sheets.
Luckily, there’s a better way—carbon accounting software.
How carbon accounting software makes calculating CO2 emissions easier and hassle-free
It is technically possible to collect data and calculate emissions manually, but it creates a huge admin burden, takes hundreds of hours, and is ultimately more of an estimation than an accurate count.
That’s why transport and logistics companies are using carbon accounting software to calculate, analyze, and report on their emissions. This software saves time by automating data collection and reporting, and provides deep insights on how companies can reduce their carbon footprint and offer more sustainable options to their clients.
Carbon accounting software also makes compliance with regulations like the CSRD much easier and more accurate for both the companies themselves and their clients. And if you’re looking for carbon accounting software designed to make calculating and reporting on supply-chain-related CO2 emissions easy, then look no further than BigMile.
Benefits of calculating CO2 emissions
So now you know how to calculate CO2 emissions for your company, but what are the benefits? Well firstly, it’s important to know what your starting point is. How can you make plans to reduce your emissions if you don’t know what they are now? As Martijn Scheffers from De Rijke Group says, “measuring is knowing”:
Calculating emissions helps transport and logistics companies to make better investment decisions, such as whether to switch to electric trucks. It also helps to attract new clients by providing transparent reporting on emissions and more environmentally friendly transport options.
And of course, reporting your emissions is now mandatory in many jurisdictions thanks to new regulations such as the CSRD.
Why leading transport and logistics companies are using BigMile to calculate CO2 emissions
At BigMile, we’re committed to making emissions reporting easy, accurate, and hassle-free for transport and logistics companies, as well as shippers. With our platform, you can accurately measure your emissions, get insights on how to reduce your emissions, provide customized reports to your clients, and comply with regulations like the CSRD.
So whether you’re trying to move from manual, labor-intensive spreadsheet calculation or whether you’re just starting the journey of emissions measurement, we can make carbon accounting hassle-free—so you can focus on delivering value for your clients.
We also partner with leading software providers to add our Emissions API to their platforms, so why not check if your existing supply chain systems include the BigMile API (and if not, you can always make a request to add it).
Are you ready to get started with carbon accounting? Join 300+ companies like RICOH, Rittal, and De Rijke Group who are using BigMile to calculate their carbon footprint. Simply book a demo and we’ll give you a personalized tour of our platform and how it can help you.
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