SunPower, a solar power and energy services provider, is starting to ship solar panels in electric heavy-duty trucks powered by — you guessed it — solar energy. The question that communities and investors are starting to ask is, why isn’t everybody?
How long can a company go without a plan to end goods transport powered by fossil fuels, and what are the health and climate consequences of the status quo?
Despite making up only about 4% of the vehicles on the road, diesel trucks are responsible for over half the smog-forming pollution from the transportation sector and a quarter of the climate emissions. This pollution is projected to grow, as demand for freight moved by trucks is on track to increase about 25% by 2030.
The local impact of this pollution is significant. Recent studies in places such as Oakland, California and Houston — two regions with large port operations and associated goods movement equipment located in or near environmental justice communities — have proven that diesel truck pollution leads to increases in childhood asthma rates and lower life expectancies in frontline communities.
Until now, there has been no method to attribute air pollution to individual companies that rely on and pay for trucks to move their goods. A new peer-reviewed framework enables the calculation of local health impacts from diesel trucks based on a company’s market share and public information about their industry sector.
That’s good news for companies and investors with climate and sustainability commitments. It’s also likely to be welcome news to community groups looking to better understand who is making choices that contribute to the pollution in their neighborhoods.
A new spotlight on transport supply chain emissions
Most companies that send or acquire their products on trucks do not own those trucks, but rather rely on shipping services, often arranged through multiple layers of contractors, many of which have only a small number of employees. As a result, stakeholders and investors in many major consumer-facing businesses have had little ability to understand emissions from truck-dependent operations, and even less ability to trace the local health impacts.
A new paper from Environmental Defense Fund published this month in the journal Sustainability, demonstrates a new way to quantify truck pollution from corporate actions using public data.
This case study focuses on the retail and wholesale food freight industry in Los Angeles and reveals that shipping emissions from the industry can both be quantified and linked to major market actors in the area. As a result, a critical component of the supply chain emissions of major grocers and food supply companies can be estimated, and the impact of those emissions (in economic terms) can be calculated.
For the companies evaluated in our paper, the transportation-related greenhouse gas emissions in the Los Angeles region alone exceeded 617,000 metric tons of carbon dioxide — the equivalent pollution of nearly 135,000 cars. This same pollution had a total societal cost in excess of $82 million in one year alone.
The new study puts a spotlight on all transport supply chain emissions — and makes the case that similar studies can be done in other regions, for other sectors and even nationally.
What can companies do to better track truck pollution?
Although the truck pollution burden associated with goods movement has been established for a long time, this new study makes it clear to companies, investors and customers that transportation emissions from the supply chain can have dramatic global and local impacts, and that quantifying and affiliating those impacts to individual companies is possible.
How should companies tackle supply chain emissions if they don’t own or operate trucks?
- Companies can and should quantify their own supply chain emissions using the best data they have available — such as company-specific proprietary data — and both track and report those emissions within standard corporate reporting paradigms so that investors and other stakeholders can compare and track progress over time.
- Companies can and should work with their suppliers — as SunPower did — to ensure they are using zero-emission equipment to the maximum extent feasible. New financial and contractual mechanisms enable companies to sponsor zero-emission vehicles even when they don’t own the trucks.
- Companies can and should support policies to get more zero-emission vehicles on the road and into their supply chain — including programs such as purchasing grants, emissions regulations and other supporting zero-emission vehicle policies.
There is little doubt that the dual climate and air pollution crises are changing the business environment in the United States. Not only are emissions-intensive businesses and industries increasingly under the microscope by state and federal policymakers who are looking to make a difference, customers and investors are increasingly asking what their favorite businesses are doing to respond to the ongoing threats. At the same time, companies face wild volatility in their cost of logistics and are struggling to find sufficient drivers, warehouse and distribution space to enable them to meet expectations.
These interrelated challenges are actually good news for companies that are serious about climate and health. By accounting for, disclosing and then mitigating transport pollution, companies can be better local neighbors and better global citizens. Leaders will enjoy some well-deserved appreciation and provide an example that shifts the industry as a whole.
Jamie Fine contributed to this post