Shipping emissions data quality not an excuse for inaction

Shipping emissions data quality not an excuse for inaction

Shippers need to scale up their involvement in carbon footprint reducing initiatives, and the tools to measure and reduce CO2 levels are available. Photo credit: Shutterstock

HAMBURG, Germany — Shippers should not use doubts over data quality as an excuse to postpone taking action to reduce the carbon footprint of their supply chains, according to Kuehne + Nagel’s Paolo Montrone. Many service providers in recent years have started offering so-called green or carbon neutral transport services — sometimes at a premium price — amid generally lukewarm interest from shippers.

Montrone, senior vice president and head of global trades at K+N, the world’s largest ocean forwarder, told the JOC’s Container Trade Europe conference that the current data on carbon dioxide (CO2) emissions may not be perfect, but it was the best the industry has ever had.

“We need to be careful not to fall into a loop of saying the data is not good enough. Data will never be good enough. We can always argue that, but it can quickly become an alibi for postponing action,” he said.

Montrone said carbon calculators and emissions reports, such as those offered by K+N, allowed shippers to reduce their carbon footprints in a tangible way, and he said interest has been increasing recently.

“The subject was dormant until maybe six months ago and now every day we are approached by an existing customer or a potential new customer asking for a pragmatic approach to reducing CO2 emissions. Our customer’s markets — consumers and retailers — will demand they clean up their supply chain. There are a lot of tools and they will become better and better, but I don’t think we should postpone action by saying the tools are not good enough.”

Speakers on a green supply chain panel expressed concern that not enough shippers were adopting green transport solutions. Kathrin Brost, DHL Global Forwarding’s global head of GoGreen and customer intelligence program, agreed that the data was good enough to make decisions.

“What we need in procurement is for shippers to say yes, we want to procure the cleanest option,” she said. “There are a bunch of options and it is up to shippers to decide whether their procurement criteria is ‘cheap, cheap, cheap,’ or whether they want the greenest solution.”

Call for backup

It is not that simple, said Jordi Espin, policy manager, maritime transport at the European Shippers’ Council. He said more transparency was required to establish how the green service costs were being tallied.

“The point is to agree what is backing up the final cost. It is important that the information is always backed up, and we have found that many of the options are costly without any information backing the data up,” he said.

Angie Farrag-Thibault, director of collaborative industries at Clean Cargo Working Group, said the level of engagement of shippers had to increase, and shippers needed to have greater influence over their procurement budgets and figure out their buying power when it came to securing sustainable transport services.

“We need to address the thousands of shippers that are not there yet and encourage them to use the data that is available, and assure them that the level of transparency is there,” she said. “Improvement is needed, sure, but come and be a part of the dialogue that is already happening.”

Clean Cargo Working Group, a unit of Business for Social Responsibilities, measures emissions from 80 percent of the world’s container cargo capacity and has 60 members comprising most of the top forwarders and many global shippers.

While conceding that improvements in data emissions collecting were needed, Farrag-Thibault said Clean Cargo had set up a standardized measuring framework that carriers have been able to use in their reporting over the past decade.

“We have gathered solid data for several years, we can see performance trend differences and it gives a view of what carriers are improving in terms of CO2 emissions and what efforts are being made by a carrier to improve the data quality,” she told the Hamburg conference.

“Our emissions data is good enough for what it is trying to report, but we need to have a better idea of the efficiency improvements that are taking place in the shipping industry. As we use nominal capacity, we are not really seeing the granular effects. We see that we have bigger vessels operating, but that doesn’t mean the vessel was completely full and was more efficient than a smaller vessel that was sailing full. Those things we can’t see in the data set.”

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.