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What does GPC mean by Go Green ?
Fuel costs have been exploding over the last two years, and as a result companies are searching for every means possible to reduce fuel costs through increased shipping efficiencies. These efforts have included shipment planning and consolidation through the use of sophisticated modeling tools such as GPC’s Global Transportation Management System (GT-MS). Now, as if the costs are not enough, companies are being pushed to reduce emission pollutants, most specifically CO2. In the United States, a national carbon cap-and-trade market is imminent, and regional markets are scheduled to commence within two years. For example, the Lieberman-Warner bill, considered among the most stringent, regulates 80% of domestic CO2 emissions – including those from the transportation sector.
Go Green - Cooperation with Estia
It is fact that the transportation of goods is the main reason for the emission of environmentally devastating gases like CO2 and NOX. GPC discovered very early that this would be a good reason to develop a solution which would enable the customer to change the transportation planning based on the meanwhile well known logic of ‘carbon foot print’. Due to all that reasons GPC looked for a partner with excellent knowledge in this area. GPC found out, that ESTIA would be the right company to work together. ESTIA is a French-Swiss hold company working together very close with the ‘Ecole Polytechnique’ at Lausanne (Switzerland). ESTIA works for CEN Commission Européenne de Normalisation as a swiss expert. The interface to their environmental calculator allows GPC now to provide and save any relevant information in this area within SAP. A prototype of this interface is available since October 2009. Based on shipment data prepared by GPC, ESTIA returns the CO2 emissions, energy use, environmental impacts and external costs of transportation for each selected shipment. Every mode of transportation (truck, rail, air, barge, vessel) is supported by this interface.
Below we created a sample calculation to show the difference between a standard transportation organization and an optimized one. The calculation is based on general conditions which GPC found out through interviews with various customers.
Calculations are based on daily (real) shipments. Assumptions concerning the fuel consumptions are conservative.
Examples
1. CO2-Emissions
- Average consumption of a standard truck: 6 MPG
- Average mileage per truck per shipment: 240 Miles
- Number of trucks shipping per day 400
- Number of working days per customer per year in USA: 255
- Total number of shipments per customer per year: 102,000
- Total number of miles per customer per year: 24,480,000
For these CO2 calculations GPC used the officially published formulas provided: http://www.nativeenergy.com/pages/resrunner/286.php?afc=ResRunner
Based on these numbers the total emission of CO2 per year is 39,902.4 tons
By using GPC GT-MS a reduction of 10% of the transportation volume is possible which means in consequence a reduction of CO2 emissions by 3,990.24 tons per year.
2. Fuel surcharge/fuel costs
- Average USA diesel price per gallon as of 8.4.08: $ 4.50 gal.
- Total consumption per truck per day: 40 gallons
- Fuel costs per truck per day: $180
- Overall fuel costs per day: $72,000
Total costs per year: $18,360,000
Assuming the same (10%) reduction of the transportation volume then a reduction of fuel costs would be $1,836,000 per year. And this would be visible for each customer either in the amount of fuel surcharge or in the amount of the base freight, depending on the type of agreement.
3. Toll
A reduction of 10% of the transportation volume would also lead to a reduction of annual toll costs.
Summary:
GPC believes that these numbers speak for themselves – thinking about an effective usage of GT-MS makes a lot of sense: For a better environment for us and all following generations and – of course – with respect to a quick and high ROI !
GLOBAL TRANSPORTATION MANAGEMENT SOLUTIONS
