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Decarbonising transport

Only 7% of transport sector companies have committed to phasing out fossil fuels
Katie Hill - Editor-in-Chief, My Green Pod
Aerial view of oil Storage tank in the port in Tsing Yi, Hong Kong

The World Benchmarking Alliance’s new Transport Benchmark highlights an urgent need for the sector to work together to develop and scale sustainable alternatives to fossil fuels.

Published today (18 October), the comprehensive analysis of 90 companies covers 25 airlines, nine rail companies, six road companies, 17 shipping companies and 33 multimodal companies.

The research was conducted in partnership with CDP, the non-profit that runs the world’s environmental disclosure system, and assessed companies including American Airlines, Japan Airlines, Ryanair, Qatar Airways, Maersk, Royal Mail and FedEx.

The research uses the Assessing low-Carbon Transition (ACT) methodology that drives climate action by benchmarking companies against advanced, science-based metrics.

No plans for change?

Transport has the highest reliance on fossil fuels of all sectors, with more than 90% of transport energy coming from crude oil-derived products.

Despite this, only 7% of companies assessed have committed to phasing out their use of fossil fuels.

Across all companies, 85% have fleets which are incompatible with a low-carbon future but the majority fail to disclose any plans for changing this.

‘Transport accounts for 37% of global carbon emissions, so the sector has to step up if we are to keep 1.5 alive. The large-scale change needed cannot be achieved without every company getting actively involved across their business – from research to customer advice to support for low-carbon policies and regulation. There is an urgent need for collaboration to identify and scale solutions.
‘Transport companies are vital to connecting people and goods globally – but they cannot thrive unless the places and people around them are thriving too. It is no exaggeration to say the future of our world will be significantly shaped by how these companies translate pledges into action.’

World Benchmarking Alliance’s Decarbonisation and Energy Transformation lead

Investing in R&D

Some of the solutions that transport operators need to adopt, such as alternative fuels (including ammonia, hydrogen and sustainable aviation fuel) and cleaner vehicles (including electric trucks) are still in early development and analysis showed that on average only 0.3% of total transport-related revenues are invested in research and development (R&D) into low-carbon technologies and fuels, such as electric vehicles and sustainable aviation fuels.

Investment in R&D is critical to ensuring that new technologies can come to market more quickly, as is working in partnership with suppliers and developers such as vehicle manufacturers or fuel producers.

However, 94% of companies do not provide any meaningful data on research and development into low-carbon vehicles and fuels.

A few companies are using their influence to push for infrastructure solutions, improved climate policy or customer behaviour change.

Only three out of 90 showed any significant support for low-carbon policy and just six directly work with infrastructure operators to build low-carbon solutions.

48% of the benchmarked companies have a strategy to help customers to reduce emissions but none of the companies had set measurable targets for customer engagement to encourage low-carbon alternatives.

‘ACT assessments are a robust way to evaluate the performance of the top emitting sectors. This benchmark highlights a vital lever or obstacle on the way to a 1.5 aligned world, demanding ambitious action from the transport sector. Companies must go further in setting not only long-term targets, but near-term targets and credible climate transition plans to demonstrate how they are going to reach these targets, currently only 51% of companies within the benchmark have net-zero targets.
‘These plans must be disclosed so they can be measured and managed. This is not happening across the sector. This means that vital risks are not being assessed or addressed, and all players could be left behind as we see a rise in regulation on mandatory disclosure.’

CDP’s global director of Climate Change

Green and decent jobs

In addition to decarbonisation, the research looked at the implications for workers and customers, as part of helping to ensure a low-carbon transition that leaves no one behind.

All together, the 90 transport companies employ an estimated total of 9.6 million people around the world but only 43% of these have a publicly available policy statement committing to respect the health and safety of their workers.

In addition, only three companies disclose quantitative information on health and safety for their workers.

While 38% of companies demonstrate measures on skills, training and education of employees, only FirstGroup publicly commits to both green and decent jobs, re- and up-skilling workers displaced by the low-carbon transition.

Transport Benchmark’s top 5

The top five performing companies across the Transport Benchmark are:

1. ComfortDelGro Corporation – A Singapore-based company operating vehicles in seven countries, including bus, taxi, rail and car rental. It has set multiple 1.5°C validated targets covering all its emissions and developed a detailed low carbon transition plan.
2. La Poste Groupe – The French postal service company has significantly reduced its overall emissions, in part due to the electrification of the company’s fleet, which reached 38% in 2021.
3. FirstGroup – A UK public transport company that carried almost 1.5m passengers per day in 2021 on bus and rail. It is the only company that publicly commits to both to green and decent jobs, and training workers who risk being displaced by the low-carbon transition. 
4. NS Groep – The principal passenger railway operator in the Netherlands. NS Groep’s entire fleet of trains is electrified and it aims to increase the proportion of renewable energy used to power its rail infrastructure. It also engages suppliers and customers to encourage emission reductions.
5. Maersk – One of the world’s largest container shipping companies, based in Denmark. It is one of the few companies with a policy to engage trade associations on climate issues, and reviews its membership status annually to ensure its trade associations are in alignment with the Paris Agreement.

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