Railsponsible. Railsponsible Webinar What Climate Actions can Suppliers Take? November 27, 2018

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1 Railsponsible Railsponsible Webinar What Climate Actions can Suppliers Take? November 27, 2018

2 Welcome! Agenda Introductions and housekeeping Railsponsible Climate Position Paper Intervention from UIC Intervention from a Railsponsible member (SBB) Q&A and Close Notes You will be automatically muted on joining the webinar. We will unmute everyone near the start so that you can introduce yourself, and then remute all participants for the presentation. If you would like to ask a question during the presentation, please use the Raise hand function in the WebEx and we will unmute you and call on you. You may also post questions in the Q&A section of the WebEx. If you have technical issues or a comment, you may also use the chat function. For the Q&A we will unmute all participants. If you have background noise or if you do not wish to ask a question, please re-mute yourself. 2

3 Our Speakers Tara Norton BSR Managing Director Supply Chain Giulio Berruti BSR Associate Director Carole Escolan Zeno UIC Manager of Unit - Sustainable Development Nadia Stillhart Diallo SBB Project Manager 3 3

4 Introductions: About Railsponsible

5 Railsponsible: Our footprint 13 Companies are part of Railsponsible, ranging from suppliers to system houses to railway operators EUR 50bn Total procurement spend of Railsponsible members 41% Of member procurement spend has been covered by CSR assessments 900 Suppliers have participated in the Railsponsible assessment program. 5

6 Vision Sustainable procurement is a key driver of value for business and society. A global railway industry where all suppliers have in place good ethical, social, environmental and business practices. Mission To continuously improve the sustainability practices of railway industry suppliers. To share best practices and processes, driving a shared understanding across the industry. To use and share common tools, creating efficiencies 6

7 Our members today Railsponsible was founded in 2015 by Alstom, Bombardier Transportation, Deutsche Bahn, Knorr Bremse, Nederlandse Spoorwegen (NS) and SNCF. Today Railsponsible has 13 members and is looking at expanding globally 7

8 BSR: Global Nonprofit Business Network We are a global nonprofit organization that works with our network of more than 250 member companies and other partners to build a just and sustainable world. From our offices in Asia, Europe, and North America, we develop sustainable business strategies and solutions through consulting, research, and cross-sector collaboration. Copenhagen Guangzhou Hong Kong New York Paris San Francisco Shanghai Tokyo 8

9 Railsponsible Climate Position Paper

10 Setting the scene Climate change is becoming a growing concern Paris Agreement (2015), GCAS, 1.5 C IPCC Report (2018), COP24 Businesses need to transition and drive actively solutions Transport sector is one of the main sources of GHG emissions 24.7% of global energy related CO2 emissions in 2015 Rail is considered as the greenest mode of transportation 4.2% of global transport CO2 emissions in 2015 (vs. 72.6% for road,10.9% for aviation and 10.2% for marine) But the rail industry supply chain has significant climate impacts Energy intensive raw materials, infrastructure development, manufacturing, maintenance/overhaul, as well as end of life/recycling Rail industry commitment to reduce its carbon footprint 10 Railway operators, system houses, and organizations within the vast rail supply chain need to contribute more towards climate change mitigation.

11 11 Railsponsible Climate Position Paper

12 Proposed commitments for companies working in the sector Build a climate strategy Set climate targets Ambitious Renewable Energy Target Ambitious Energy Productivity Target Transparency / Reporting on Climate Change Impacts Develop Governance, Management & Procurement Processes to support a climate program 12

13 How to build your climate strategy Commit to ambitious targets in line with the Paris Agreement and develop corresponding improvement plans Develop a governance and management structure around the strategy Develop products and change or improve raw material input Focus on the most impactful actions Alstom has adopted a «Climate and energy transition strategy» along three lines: placing energy-efficient electrical rail solutions at the heart of its portfolio; enabling the transition to sustainable mobility solutions; decarbonizing its operations. 13

14 How to set climate targets Develop concrete and measurable targets. Start setting targets for Scope 1&2 emissions and work towards including the more challenging Scope 3 emissions. Cascade targets tailored to different areas within your business (including procurement) Railsponsible Member Examples: Zero emissions for mobility and buildings by 2020 Nederlandse Spoorwegen 100% renewable energy by 2050 Deutsche Bahn Reduce energy intensity by 10% in 2020 compared to Alstom GHG Assessment clause introduced into all transport and logistics contracts - SKF 14

15 Tips to go forward Engage the critical parts of your business Focus on where you can create impact Assess your energy and climate impact to get a benchmark Incorporate climate into procurement and supply chain management Encourage your suppliers Some practical tools for companies starting the climate journey: Setting targets: Science Based Targets Initiative Understanding climate legislation: WMB Climate Policy Tracker Calculating emissions : GHG Protocol or ADEME Carbon Footprint Estimating freight emissions: EcoTransIT World 15

16 UIC The worldwide railway organisation

17 UIC Members all around the world 17 5 UIC global cooperation issues serving the entire railway community Environment & Sustainable Development Safety & Security Freight / Intercontinental corridors Railway Signalling & Control Command Standardisa tion UIC leaflets, IRS

18 Dortmund, Germany, Hanoi, Vietnam, 2018 Coonabarabran, Australia, 2018

19 UIC TARGETS 19 LOW CARBON RAIL TRANSPORT CHALLENGE RAILWAY CLIMATE RESPONSIBILITY PLEDGE Final ENERGY CONSUMPTION from train operations: - 50% by 2030 (1990) and - 60% by 2050 Average CO 2 EMISSIONS from train operations: - 50% by 2030 (1990) and 75% by 2050 Railway SHARE OF PASSENGER transport (pkm) by 2030: + 50% (2010) and +100% by 2050 Railway SHARE OF FREIGHT land transport (tkm): equal to road by 2030 and 50% greater than road by 2050 Contribute to the UIC LOW CARBON RAIL TRANSPORT CHALLENGE, Stimulate MODAL SHIFT TO RAIL in national and international markets, Actively communicate to RAISE AWARENESS, REPORT DATA on one s company s indicators above on a regular basis in order to promote and demonstrate the continuous improvements at an international level.

20 Railsponsible Climate webinar. Nadia Stillhart, Bern, 27 November 2018

21 SBB s sustainability strategy. Environmentally friendly rail travel Responsible value chain SBB Division Department or Unit DD.MM.YY 21

22 The four relevant areas for action. Responsibility towards a circular economy Responsibility towards the environment Responsibility as an employer Responsibility towards customers Responsibility towards society Ensuring a responsible and efficient value chain Ensuring environmental advantage of passenger and freight services over roads Being a responsible employer Making mobility and logistics services sustainable and easy to access and use Contributing to providing sustainable transport services and real estate in Switzerland Sustainable procurement Climate protection Attractive employment conditions Combined mobility Sustainable traffic and service planning and spatial development Waste and recyclables management Energy Healthy employees Green innovations Optimising commuter flows Lifecycle approach Conservation Occupational safety Accessibility Noise protection Operational security Safe rail access SBB Division Department or Unit DD.MM.YY 22

23 Climate and energy targets. Responsibility towards a circular economy Responsibility towards the environment Responsibility as an employer Responsibility towards customers Responsibility towards society Ensuring a responsible and efficient value chain Sustainable procurement Waste and recyclables management Lifecycle approach Ensuring environmental advantage of passenger and freight services over roads Climate protection Energy Conservation Noise protection Being a responsible employer Attractive employment conditions Making mobility and logistics services sustainable and easy to access and use -50% CO 2 compared Combined to 1990 mobility Contributing to providing sustainable transport services and real estate in Switzerland Sustainable traffic and service planning and spatial development Healthy -20% energy consumption Green from the Optimising bases case (or employees save 600GWh) innovations commuter flows Occupational safety Accessibility 100% renewable energy for buildings (by 2019) and trains Operational security GWh domestic energy with solar panels 95 GWh Safe heating rail access with new renewable energy 2025 Specific climate targets SBB Division Department or Unit DD.MM.YY 23

24 Great potential in the supply chain. Responsibility towards a circular economy Responsibility towards the environment Responsibility as an employer Responsibility towards customers Responsibility towards society Ensuring a responsible and efficient value chain Sustainable procurement Waste and recyclables management Lifecycle approach Ensuring environmental advantage of passenger and freight services over roads Climate protection Energy Conservation Noise protection Being a responsible Supply employer chain Material purchase Attractive employment Waste disposal conditions Employee mobility Healthy employees Greenhouse gases Traction current Occupational safety Thermal energy for buildings and facilities Electricity for buildings and facilities Non-traction fuel Making mobility and logistics services sustainable and easy to access and use Combined mobility Partial amount Green innovations Accessibility CO 2 eq. emissions within SBB Operational security Contributing to providing sustainable transport services and real estate in Switzerland Sustainable traffic and service planning and spatial development Optimising commuter CO 2 eq. emissions flows in the supply chain Diesel for traction Safe rail access 0 200, , , ,000 1,000,000 1,200,000 Equivalent to tonnes of CO 2 Potential SBB Division Department or Unit DD.MM.YY 24

25 Almost 90% of the environmental impact in the supply chain is a result of the GHG and air pollutants, which are largely generated by direct suppliers. Extraction of raw materials Processing Completion(dir ect suppliers) Electricity Percentage of ext. emissions in the supply chain 12% 36% 37% 16% 100% GREEN HOUSE GASES (GHG) 52% AIR POLLUTANTS 37% WATER POLLUTANTS 2% WATER CONSUMPTION 4% LAND USE 5% SBB Group KOM-SMN-NH

26 Example: new technology Background Issue New forms of technology can replace fuels that damage the environment and are often more energy efficient. After thermal energy for buildings, diesel for traction is SBB s biggest producer of CO2 emissions. Three Prima H3 hybrid locomotives have already been in use for test purposes at SBB Cargo in Wildegg and in enclosed areas of the Basel- Kleinhüningen port since mid Solution process On 25 October following the successful test, SBB Cargo signeda contract procuring another 12 Prima H3 locomotives. This resulted in: Savings of 865,000 litres of Diesel or tonnes of CO 2 every year (-50%) Other pollutant emissions reduced by up to 70%. Fewer noise emissions for residents The possibility of emission-free rail traffic in urban areas or inside production halls SBB Group K-SMN-NH 26

27 Example: resource efficiency and circular economy. Issue Resources are limited and therefore need to be used as efficiently as possible throughout the life cycle. This includes the choice of materials, ease of repair and the possibility of upgrading and recycling the materials. Background Various types of sleepers are installed for the permanent way (wood, steel, concrete). Which is the most environmentally friendly sleeper, when observed throughout its life cycle? Solution process To get to the bottom of the issue, an ecological assessment was commissioned for wooden, steel and concrete sleepers. The results showed that, in most scenarios, theconcrete sleepers are not onlythe most environmentally friendly, but also the most cost efficientthroughout their life cycle. Depending on the scenario the greenhouse gas emissions produced using the concrete sleepers were 3 to 46% lowerthan when using the wooden sleepers For concrete and steel sleepers, there is only one scenario observed in which concrete sleepers produce, in comparison, 5% lower greenhouse gas emissions. SBB Group K-SMN-NH 27

28 Example: packaging material. Background Issue Packaging material can incur indirect costs. Reusable packaging or another sustainable choice of material reduces costs and eliminates CO 2 emissions and waste. Rail fastenings used to be packaged and shipped in disposable frames. This resulted in a huge amount of waste, which needed to be disposed of for a fee. The wood and plastic were only used once. Solution process In consultation with the suppliers, the problem was analysed and a solution using reusable frames was devised. By foregoing disposable methods of transportation, SBB can: save 5 10% CO 2 emissions. The financial savings amount to CHF 18,000 CHF per year for rail fastenings. Call for tenders: Minimum requirement in the logistics specification: Mandatory use of reusable containers SBB Group K-SMN-NH 28

29 Thank you. 29

30 Q&A

31 Thank you.