Transport Sector in the Slow Lane for Managing Carbon

Transport Sector in the Slow Lane for Managing Carbon

Image CC licensed by Flickr user futureatlas.com

The transport sector generates 13 percent of global greenhouse gas emissions, but a new study suggests the industry is in the slow lane when it comes to disclosing their carbon footprints and setting plans to shrink them.

The Carbon Disclosure Project (CDP) surveyed nearly 300 of the world's largest transport companies (PDF) in a bid to assess how prepared the sector is to operate in a carbon constrained world. Global business is dependent upon the sector to move goods and services.

Yet while there are some leading companies clearly taking steps to manage carbon, the overall transport sector lags in reporting its emissions, devising emissions reduction plans, and identifying the risks and opportunities associated with climate change regulations. A scant 9 percent invested in low carbon technologies, such as electric vehicles or renewable energy.

“As the first real glimpse into the transport sector’s impact on climate change, I’m pleased to see that there are some clear leaders making good progress in setting targets and making investments in low-carbon alternatives," Zoe Tcholak-Antitch, vice president and head of Investor CDP, said in a statement Thursday. "The overwhelming conclusion, however, is that the sector as a whole needs to transform and realize the opportunity to make a profound impact on the environment and the business benefits to reducing emissions. Those companies which are already investing in that transformation will be better positioned for a carbon constrained world.”

Of the 291 transport companies sent questionnaires, only 53 percent responded, compared to the 2009 Global 500 response rate of 82 percent, and S&P 500 response rate of 66 percent.

Transportation companies in Europe (52 percent) and South America (60 percent) are more likely to develop emissions reduction plans compared to their Asian (18 percent), U.S. and Canadian (47 percent) counterparts.

Slightly more than a third of transportation companies responding to the CDP (36 percent) have set emissions reduction targets, compared to 51 percent of companies on the Global 500.

Transportation companies also lag other sectors in identifying regulatory risks and opportunities, even though the industry is exposed to a variety of regulatory regimes around the world. For example, 60 percent of global companies cite regulatory risks in their CDP questionnaires, while another 60 percent discuss related opportunities. In comparison, 53 percent of transport companies identified regulatory risks, while another 59 percent cited opportunities.

But there are definitely leaders that are taking advantage of the opportunities, such as United Parcel Service and Toyota. While only 9 percent invested in low carbon technologies, the price tag was $31.93 billion put toward low carbon fuels, electric or hybrid vehicles, and renewable energy systems. EasyJet, Union Pacific Corp. and Air France-KLM making the largest investments.

Image CC licensed by Flickr user futureatlas.com.