SmartWay 2.0 February 9, 2009 Buddy Polovick USEPA

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1 LOGISTICS 2009 February 8-11, 2009 Gaylord Texan Dallas, Texas SmartWay 2.0 February 9, 2009 Buddy Polovick USEPA

2 Outline Energy, Environment, Economy SmartWay Transport Partnership SmartWay 2.0

3 U.S. Transportation Sector GHG Emissions Buses & Motorcycles 0.8% Boats & Ships 3.2% Aircraft 9.4% Pipelines Rail 1.5% 2.5% Refrigerants & Lubricants 3.8% Passenger Cars 31.4% Freight Trucks 19.1% Light-Duty Trucks 28.1% Light-Duty Vehicles 59.5% Inventory of U.S. GHG emissions, 2005

4 Rapid Increase in Transportation Greenhouse Gas Emissions Source: US Emissions Inventory (April 2008) EPA 430-R

5 Energy Costs

6 Energy Security I drink your milkshake I drink it up! Who uses the oil?

7 Pending Legislation on Climate Change

8 SmartWay is at Nexus of Key Concerns Environment GHG Critera Pollutants Regulations Energy Oil dependency Alternative fuels New Technologies SmartWay Economy Cost savings Competitive advantage Modal shifts

9 The Partnership

10 SmartWay Transport Partnership What is SmartWay? Successful government/industry collaboration Voluntarily achieves improved fuel efficiency Reduces environmental impacts from freight transport Partnership Categories Carriers Shippers Logistics Rail Partners use models: Benchmark freight operations Measure transportation footprint Identify technologies & strategies to reduce emissions Track emissions reductions and project improvement Equipment Manufacturers SmartWay certified cars & trucks Auto manufacturers Tractor manufacturers Trailer manufacturers

11 How Does SmartWay work? Shippers: Top of the supply chain, drive marketplace demand Give preferred status to SmartWay Carrier Partners Get better data to improve their own shipping operations Modify logistics operations to improve efficiency and reduce emissions, for example: Inter-modal Shipping Full Truck Loads Warehouse Improvements Idle-Reduction at Docks Get recognition and PR value with SmartWay brand Carriers: Gain competitive advantage: Preferred status, plus Fuel efficiency, savings Reduce emissions Integrate fuel saving technologies and strategies into fleets, such as: Idle Reduction Improved Aerodynamics Efficient Tire Systems Driver Training Renewable Fuels Advanced Lubricants Get recognition and PR value with SmartWay brand

12 SmartWay Transport Partnership About 1,400 Partners (by end of 2008) Drive approximately 600,000 trucks (7% of industry) Travel over 51 billion miles per year (24% of industry) Consume over 12 billion gallons of fuel (24% of industry) Estimates for 2008: reduce greenhouse gas and pollutant emissions by: 6 million tons of CO 2 (carbon dioxide); 800 tons of PM (particulate matter); 30,000 tons of NOx (oxides of nitrogen); Save over 540 million gallons of diesel fuel this year; Save the freight industry over $2 billion in annual fuel and maintenance costs.

13 Partner Recognition

14 PSA Campaign: TV, Radio, Print

15 SmartWay Certified Vehicles

16 SmartWay Certified Tractors &Trailers

17 SmartWay 2.0

18 A Smarter SmartWay SmartWay 1.0 Domestic ground freight, i.e., trucking and rail Non-dimensional partner scoring process Detailed technology survey for carrier scoring Carbon footprinting limited to default national averages US-based operations covered SmartWay 2.0 Multimodal operations, including maritime, short sea, air cargo, drayage, port, etc. More transparent and granular carbon-based scoring Streamlined, performance based scoring based on actual miles, fuel, volume Carbon footprint based on provider and modal choices Globalized SmartWay program quantifies supply chain emissions

19 Multimodal Supply Chain Model Shippers Key Model built, needs revisions Software Company Research/ Consultants Existing Outside Systems Under Construction Database 3 rd Generation SmartWay Trucking Rail Aircraft Ocean Going Vessels Short Sea Shipping/ Barge Logistics Drayage Airports Transfer Terminals Ports/ Terminals

20 Carbon Based Carrier Scoring Systems SmartWay 1.0 SmartWay 2.0 SmartWay Shipper FLEET Model SIF Score Score These emission factors may be adopted by commercial logistics software developers 10 Bin System Grade CO2 g/mile 1 1, , , , , , , , , ,160.86

21 Streamlined Model and Scoring Systems

22 Comparison SmartWay Shipper Scoring Yes, a score of 0.59 qualifies you to use the logo Provider SCAC Code Provider's Total Mileage with Fleet Provider's Total Weight w/ Fleet Custom Metric # of Trips SIF Score for Provider Score based on Miles (miles) (tons) 0.59 Alpha Transport 10, Beta Systems 20, Gamma Carriers 10, Delta Trucking 20, Epsilon Brothers 10, Non-SmartWay 40, The current system provides a nondimensioned environmental score The new system will provide multiple efficiency metrics and total inventories for CO2, NOx, and PM: g/mile g/avg payload ton-mile g/avg cubic foot volume Provider No, an efficiency of g/mile does not qualify for the SmartWay logo SCAC Code Provider's Total Mileage w ith Fleet Provider's Total Weight w / Fleet Custom Metric # of Trips CO2 g/mile Overall g/mile efficiency Transportati on Carbon Footprint (miles) (tons) (tons) Alpha Transport 10,000 1, Beta Systems 20,000 1, Gamma Carriers 10,000 1, Delta Trucking 20,000 1, Epsilon Brothers 10,000 1, Non-SmartWay 40,000 2, , g/truckload

23 Improved Carbon Footprinting National default average emission factor

24 Globalizing SmartWay: What Have We Learned in the U.S.? There is a strong business case for more sustainable supply chains Transportation is a significant piece of corporate emissions footprint Transportation becoming greater portion of operating costs All companies want to save fuel Globalization of supply chains introduces new challenges and opportunities Multinational corporations linking their operations across more of the worlds ports and borders Longer, multimodal supply chains can also mean more emissions from trade Increased pressure to reduce embedded carbon emissions Government/Industry Partnerships can move the marketplace EPA s SmartWay Transport Program is a business friendly mechanism to reduce GHG emissions from supply chains

25 The SmartWay International Summit Dec 2-4, Ann Arbor at NVFEL and University of Michigan Developed in response to countries asking for guidance to develop and launch their own SmartWay programs Government and Trade groups from 12 countries NGOs included WRI, EDF, Carbon Trust US government officials, Academia Key themes: Developing harmonized supply chain accounting methods Broadening SmartWay to cover other modes of transport Developing an international SmartWay exchange network Next steps to keep the momentum going: Follow up discussions with stakeholders on establishing and international platform to share data, best practices Link these resources to SmartWay Supply Chain modeling

26 Measuring & Reducing Supply Chain Emissions

www.epa.gov/smartway smartway_transport@epa.

27 phone center Buddy Polovick

SmartWay Transport Partnership

SmartWay Transport Partnership Enhanced Supply Chain Performance Buddy Polovick, USEPA October 14, 2010 Today s Presentation SmartWay program overview Key program components Looking to the Supply Chain