cscmp 2014: leveraging intermodal partnerships for more sustainable freight
DESCRIPTION
Presentation by John Lovenburg, Vice President Environmental, BNSF RailwayTRANSCRIPT
Leveraging Intermodal
Partnerships for More
Sustainable Freight
Session 4: Building a Sustainable Future
Through Supply Chain Collaboration
John Lovenburg, Vice President, Environmental
BNSF Railway
Agenda
• BNSF Railway Overview
• Why Transportation Matters
to Customer Sustainability
• Logistics Decision-Making
• Sustainable Freight Best
Practices
• Carbon Footprint
• Summary
BNSF Railway Overview
A Berkshire Hathaway company
Moves one-fourth of the nation’s rail freight
43,000+ employees
7,000 locomotives
32,500 route miles in 28 states and two Canadian provinces
Operates over 1,600 freight trains per day
Serves over 40 ports
13,000 bridges and 89 tunnels
Rail infrastructure financed by the railroad
On average, we move 1 ton of freight ~500 miles on a single gallon of diesel fuel
BNSF Service Four Markets
• Agricultural – crops, fertilizer,
ethanol, finished food
products
• Consumer Products
(Intermodal) & Automobiles
• Coal
• Industrial products – mining,
equipment, chemicals, crude
oil, lumber, etc.
Why Transportation Matters to Customer Sustainability
Transportation is typically 5-20% of product footprints,
reported as Scope 3 emissions
Delivering
Raw Materials
Shipping
Finished Goods
Reducing Highway
Congestion
Increasing Fuel
Efficiency
Generating Fewer
Emissions
One BNSF intermodal train removes
more than 280 long-haul trucks from
our nation’s highways
Rail is over 3 times more fuel
efficient than long-haul trucks
BNSF customers reduce GHG
emissions by over 30 million metric
tons each year vs. highway
5
Logistics Decision-Making
1. Service Fit
Market access, capacity,
handling requirements, etc.
2. Speed
3. Cost
4. Sustainability, especially
carbon
6
Intermodal Provides Sustainability Win-Win
• Cut costs by 10%
• Reduce carbon footprint of
land freight portfolio by 50%
7
Sustainable Freight Best Practices (1 of 2)
• Reduce Travel Distance– Distributed manufacturing (on-shore or near-shore)
• Loading– Reduce unnecessary packaging
– Fully load containers
• Mode Efficiency– Optimize mode selection; from least to most efficient: plane, truck, rail,
ship
• Network Efficiency– Enhance network fluidity and deploy congestion management measures
– Find backhaul matches to reduce empty loads
8
Sustainable Freight Best Practices (2 of 2)
• Fleet Equipment– Modernize fleets for better efficiency, lower emissions
– Right-size horsepower per load
– Deploy energy management systems and train staff on fuel
efficient operations
– Install auto-engine start-stop to reduce idling
• Transportation Surfaces – Reduce coefficient of friction (e.g., top of rail lubrication, properly
inflate tires)
9
BNSF Carbon Estimator
Cut land freight carbon footprint in half by
incorporating rail into your supply chain.
Results can be found on bnsf.com by using the
• Intermodal Advisor
• Carbon Estimator tool
10
Shipments
Shipments with
Conversion
Savings on BNSF
1,397
Lanes with Eastern US
Origin and Destination456
Not An Intermodal Fit 606
Total Shipments
Evaluated2,459
Estimated savings are based on lane-specific OTR truck averages versus estimated intermodal door-to-
door rates. Actual savings may vary based on freight characteristics, fuel program, assessorial charges,
and negotiations between you and your transportation providers. This analysis is provided solely for the
purpose of determining intermodal fit and is not intended to be used for negotiating purposes. Estimated
rates will fluctuate over time and are not adjusted for seasonality.
Results by CategoryFits with Savings
Intermodal Advisor Analysis
Customer Example – Dry Results
INTERMODAL
FIT 1DOOR-TO-
DOOR LANES
ANNUAL
SHIPMENTS
TOTAL
SAVINGS
CARBON
SAVINGS(Metric Tons CO2e)
Excellent 106 1,192 $1,299,975 1,518
Better 32 138 $37,466 103
Good 1 67 $26,850 86
Grand Total 139 1,397 $1,364,291 1,707
1 Fit Quality Based on Estimated % Cost Savings per Shipment
11
Case Study: Sierra Nevada Brewing
Challenge: Growing demand for California-based Sierra Nevada products in eastern markets necessitated cost-effective transport options that met brewer’s temperature- and time-sensitive requirements.
Solution: Using Alliance Shippers and BNSF Railway, Sierra Nevada discovered sustainable, service–sensitive benefits of intermodal.
Results: Nearly 70 percent of all easterly bound truckloads moved via Alliance/BNSF in 2012; the conversion of more than 7 million miles to intermodal by Sierra Nevada reduced CO2 emissions by nearly 50 percent.
12
Summary – Leveraging Intermodal Partnerships for More Sustainable Freight
• Rail/intermodal is the most
sustainable land freight
transport option
• Sustainable freight reduces
costs, grows the business and
improves ability to operate &
expand
REDUCED HIGHWAY
CONGESTION
FEWER
EMISSIONS
FUEL
EFFICIENCY
