BSR’s “Sustainability”  Report Addresses Climate Change for Supply Chain Managers

Earlier this year, scientists reported that 2014 was the hottest year in recorded history, underscoring the urgency of action to reduce emissions that contribute to climate change, says Nathan Springer, Manager, Advisory Services, for BSR in San Francisco

To do its part, the transport sector, which contributes about a quarter of global energy-related emissions, would need to expand low-carbon fuels from 3 percent of the share today to more than 30 percent by 2050.

Yet owners of corporate fleets and fuel buyers face two dilemmas: a limited supply of cost-effective, low greenhouse-gas fuels, and little information on fuel sustainability impacts across the full production and use value chain.

Today, BSR’s Future of Fuels initiative releases an updated version of our report “The Sustainability Impacts of Fuel,” which provides a comprehensive analysis of the economic, social, and environmental impacts of diesel, natural gas, biofuels, electrification, and hydrogen for trucking. After reviewing more than 500 comments on the first draft of the report, and adding the latest science and stakeholder views, we came to three conclusions:

The industry must address issues at a systemic level to avoid unintended consequences and solutions that will fail to have the desired large-scale impact.
Despite some uncertainties and trade-offs from the impacts of alternative fuels, the case for bold action to accelerate low-carbon fuels is clear.
Practical solutions exist to accelerate low-carbon fuels and avoid or reduce their sustainability impacts.

Our report highlights some examples of these findings:

Demand for natural gas has never been stronger, but key impacts must be reduced to realize its potential as a low-carbon, sustainable fuel. Natural gas can be considered a low-carbon alternative to diesel only to the extent that it lowers emissions, from drilling and refining to distribution and burning. Methane, a gas that is 20 times more potent than carbon dioxide, escapes at all stages of this process, and new data suggest that keeping methane leakage below 1 percent would ensure lower emissions than diesel. It is critical to understand and manage methane leakage, as well as other sustainability impacts natural gas pumping can have on communities, water, and seismicity.

This approach—of managing the full spectrum of sustainability impacts across the fuel production and use system—is also important when considering diesel and low-carbon alternatives.

New standards and maturing market approaches provide tools to manage some of the biggest uncertainties and trade-offs of alternative fuels. California’s low-carbon fuel standard offers fleet planners comparable data on emissions for more than 160 fuel-production processes. Market schemes such as the Roundtable on Sustainable Biomaterials certification provide scientific and industry verification of biofuels’ social and environmental performance.

Meanwhile, the U.S. Department of Energy, Environmental Defense Fund, and others are investing in commercialization of new technologies to address sustainability impacts such as methane leakage and water contamination in natural gas.

Low-carbon fuels may not work for all applications, but they do provide practical solutions for many fleet needs. Even though hybrid electric engines are a ways off for commercial long-haul trucks, electrification can be deployed in other ways to reduce fleet emissions, for instance for air-conditioning and other systems.

Renewable natural gas (a byproduct of landfills and other sources) can be used in existing natural gas vehicles and has a potential to replace 2.5 billion gallons of diesel yearly while creating a negative carbon footprint from transport. Hydrogen fuel cells already power materials-handling vehicles and transit buses and can be used to extend the range of medium-duty-battery electric vehicles.

Using these findings, BSR and our Future of Fuels member companies will be developing a “fuel tool” that fleet managers can use to identify and procure the lowest-carbon, most sustainable fuel available. While uncertainties and trade-offs in fuel sustainability remain, the case for bold action is clear.

By drawing on and adding to a suite of practical solutions for fleet managers, this tool will accelerate the use of low-carbon fuels while reducing or avoiding other sustainability impacts.

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