Chapter 12 Green Maritime Logistics and Sustainability Haakon Lindstad, Bjorn E. Ashjornslett and Jan Tore Pedersen Abstract The environmental consequences of international trade aad transport have gained importance as a result of the current climate debate. Products are increasingly being produced in one part of the world, transported to another country and then redistributed to their final country of consumption. Since more than 80% of world trade tonnage measured in metric tons is carried by seagoing vessels, maritime transport will continue to be a core part of most supply chains while rail and road mainly are used for hinterland transport and to and from ports. This chapter presents a methodology for assessing the environmental impact of maritime transport and transport in general, with a specific focus on. greenhouse gas emissions. The first section gives an introduction to why Green Maritime Logistics and Sustainability are important topics, while the second offers a framework for measuring greenhouse gas emissions (GHG) for transport systems. The third section presents a model for measuring seaborne transport and its greenhouse gas emissions, and in the fourth section we compare greenhouse gas emissions from different modes of transportation, Keywords: Maritime transport; energy efficiency. benchmarking; logistics 12.1. Introduction Since the late 1980s and until 2007, the rate of growth in world trade was higher than in any other period during the last 200 years, and trade and transport volumes nearly doubled, while world energy consumption rose from 8732 MTOE (million tons of oil equivalent) in 1990 to 12,013 MTOE in 2007 (IEA, 2009) of which 20% (Second IMO GHG Study, 2009) was consumed by the transport sector. This increased the Maritime Logisties: Contemporary Issues Copyright ( 2012 by Emerald Group Publishing Limited AW rights of reprosiuction in any form reserved ISBN: 978-1-78052-340-8228 Haakon Lindstad et al. challenges reiated to available energy sources and raised emissions of greenhouse gases, since 80% (IEA, 2009) of the energy consumed by this sector comes from burning fossil fuel. When energy is generated by burning fossit fuel, the outputs are enerey as such and CO,, which is the main manmade greenhouse gas, Greenhouse gases are essential for maintaining the temperature of the Earth. However. excess production of greenhouse gases can raise the temperature and cause climate change which is widely regarded as one of the gravest threats to the environmental sustainability of the planet, the well-being of its people and the strength of its economies, According to the IMO (Second IMO GHG Study, 2009), maritime transport emitted 1046 million tons of CO> in 2007, representing 3.3% of global greenhouse gas emissions. These emissions are expected to increase by 150-250% by 2050 if no action is taken (ie. ‘business as usual’ scenarios with a tripling of world trade). A controversial issue is how reductions in greenhouse gas emissions are to be made by individual sectors. Given a scenatio in which all sectors accept the same percentage reductions, total shipping emissions in 2050 would have to be no greater than 15-30% of current levels, based on the required 50-85% reduction target set by the IPCC (2007). Moreover, if the demand for sea transport follows the predicted wipling of world trade (Lindstad, Asbjornslett, & Stromman, 2011), it can easily be deduced that the amount of CO, emitted per ton-nm (1 nm = 1.852 km) will then (as a minimum) have to be reduced from 25 to 4g of CO) per ton-nm by 2050. This is a reduction by a factor of five, which is a substantial challenge. Traditionally the evaluation of the different transport options has been based on a combination of cost and logistics requirements, where the typical cost considered has consisied of the direct costs of the vessel, its fuel, terminal handling, hinterland. transport and the capital cost of the goods transported. While more recently we have observed a growing interest in including environmental impact when assessing alternative transport options, the simplified version usually employed is to take only the CO; emitted to the atmosphere into consideration. The World Business Council has published approximate values that basically provide only an average figure for sea transport, while Psaraftis and Kontoyas (2009) estimate gram CO, per ton-km per vessel type and size. Lindstad and Morkve (2009) have developed this farther in a methodology for how to map and measure the CO» footprint along the logistics chain, Within the European Union, awareness of the environmental consequences of intensifying international trade has grown during the past two decades, For this reason, the European Commission (EC) has suggested incorporating all external costs into assessments of the total environmental impact and cost of transport. Examples of socio-environmental impact areas affected by transport are: costs of maintaining infrastructure, accidents, effects on human health, damage to buildings and nature. Life Cycle Assessment (LCA) is the leading methodology for evaluation of environmental impact, LCA has been developed as a tool for evaluating the environmental effects of a specific economic activity, LCA is usually performed as a ‘bottom-up’ process ana based on tinking the specific processes involved in a supply chain. A significant advantage of such process analysis is precisely its capability for detail.Green Maritime Logistics and Sustainability 229 However, employing LCA to assess the total environmental impact of transport, and maritime transport in particular goes beyond the forefront of current research, The focus of the rest of this chapter will therefore be on measuring the environmental performance of maritime transport in a comprehensive and uniform way to calculate the greenhouse gas emissions. 12.2, Measuring Greenhouse Gas Emissions and Energy Consumption in Transport Systems The results of energy consumption and emissions analyses can be presented in two different ways: the energy consumption and emissions for the defined system regardless of volume transported, that is a system focus, for example on emissions generated by a single transport company. Alternatively, the energy consumption and emissions per unit of product passing through the system can be calculated, that is a product focus. When we focus on measuring the performance of a system with respect to energy consumption and emissions we need to know how efficiently a unit of product is moved within the defined system boundaries. The common unit used to estimate environmental performance is CO> emitted per unit or ton of cargo or COz emission related to the transport work done, that is CO) per ton-nm or ton-km, The general approach used when calculating the CO2 per ton-nm or ton-km is: — Calculate the amount of fuel used on the voyage and multiply it by its carbon content, and the result is the CO; emitted on that voyage. ~ Multiply the tonnage of the cargo transported by the distance to give the transport work performed in ton-nm or ton-km. — The COz per ton-km is obtained by dividing the total CO» emitted on the voyage by the transport work performed. For qualified suggestions to be made about the effects of introducing measures in a maritime logistics chain for improving GHG emissions and energy consumption of alternative chains, accurate estimates, or benchmarks. of the current situation are a prerequisite, There are two main approaches to performing such benchmarking studies, First, we can compare the performance of each link (nodes and legs) in the chain separately, for example individual means of transport, terminals and warehouses. Secondly, we can look at larger parts or the whole of a logisties chain. Figure 12.1 illustrates the two approaches; the ‘vertical’ approach, looking at one process, for example a single leg or node, and the ‘horizontal’ approach, that is looking at the whole of a logistics chain, Each of these approaches has its chatlenges and possible pitfalls when the ‘as-is’ or benchmarks are being estimated. However, the complexity of calculating energy consumption and CO} emissions increases when the focus is shifted from a single mean of transport or fleet of transport means to a total transport chain that inchides terminal handling and warehousing or a total value chain that also inchides