Covestro implements electric trucks for short-distance chemical shuttling at Shanghai site
Stepped-up efforts to decarbonize chemical supply chain
- Commercial deployment marks significant progress in green logistics pilot program
- Ready for scaling up at company’s largest production site
- Contributing to scope 3 emissions reduction and a circular economy
To advance the pursuit of innovative models for decarbonizing the chemical supply chain, Covestro initiated a pioneering green logistics pilot program in collaboration with partners in China in November last year. The successful collaboration has yielded positive results during the proof-of-concept phase and has now transitioned into operational implementation. This is marked by an agreement with COSCO Shipping Logistics & Supply Chain Management Co., Ltd. to propel the commercial deployment of electric trucks dedicated to the short-distance transport of chemicals at Covestro Integrated Site Shanghai (CISS).
As part of this collaborative effort, the initial phase involves the introduction of the first electric heavy-duty truck to replace the existing diesel truck for transporting polymeric diphenylmethane diisocyanate (pMDI) from the Shanghai site to nearby warehouses. This transition is set to cover part of the annual pMDI shuttle volume at Covestro’s largest production site, resulting in a projected reduction of 43 tons of CO2 equivalent in well-to-wheel emissions (CO2 emissions over the entire life cycle of fuels) in 2024 compared to the 2022 baseline – a 22 percent decrease. The future use of green power to charge the trucks will further contribute to the goal of achieving net zero in logistics.
Both companies will consistently evaluate the electric truck’s performance and efficiency, aiming for continuous optimization of the total cost of ownership associated with the vehicle. Based on these evaluations, decisions will be made regarding potential scalability.
"As a pivotal route toward achieving net zero, green logistics is poised to deliver sustainable solutions for mitigating scope 3 emissions. We look forward to working with Covestro to advance the exploration and adoption of sustainable logistics solutions in the chemical industry and contribute to the ultimate goal of net-zero emissions from the logistics side," said Fu Peng, Executive Vice President of COSCO Shipping Logistics & Supply Chain Management.
"The supply chain plays a crucial role in the chemical industry’s journey to achieve climate neutrality, demanding collaboration beyond individual company boundaries. The commercial deployment of this groundbreaking electric truck for chemical shuttling is poised to act as a catalyst, propelling our site and company towards climate neutrality and a circular economy," stated Dr. Yun Chen, General Manager of CISS.
Contributing to scope 3 emissions reduction
Approximately 80 percent of Covestro’s total emissions stem from scope 3 emissions, or indirect emissions resulting from upstream and downstream processes, including supply chains, material transport, and raw material processing.
In the Asia Pacific region, where around 70 percent of Covestro’s products are transported by truck, concerted efforts to reduce emissions within the logistics framework are specifically targeted at trucks. In light of this, the green logistics program was launched last year with the objective of devising more sustainable methods for road transportation via trucks. Collaborators in this endeavor include customers, logistics solution and infrastructure partners, and industry organizations, with the network steadily expanding.
The program is designed to rigorously assess the viability of specific strategies under distinct scenarios. Among the explored solutions is the utilization of subsidized biodiesel in Shanghai for long-haul transport of dangerous goods, as well as the integration of hydrogen fuel cell-powered trucks.
"We are committed to expanding our network of partnerships to actively seek, pilot, and scale up sustainable, low-carbon logistics solutions that meet both environmental and commercial needs. We anticipate continued progress in introducing new solutions aimed at significantly reducing our scope 3 emissions, thereby propelling us towards a climate-neutral future," said Marius Wirtz, Senior Vice President, Supply Chain & Logistics Asia Pacific, Covestro.
Covestro has said that it is aiming to become operationally climate neutral – this includes reducing both direct emissions from its own operations (scope 1) as well as indirect emissions from purchased energy (scope 2) to net zero – by 2035. The company is poised to unveil its reduction targets for scope 3 emissions soon.
About COSCO Shipping Logistics & Supply Chain Management:
COSCO Shipping Logistics & Supply Chain Management Co., Ltd., an affiliate of China COSCO Shipping Corporation Limited, is an international integrated logistics enterprise with shipping logistics as its core. It specializes in providing modernized and professional end-to-end logistics and supply chain solutions for customers home and abroad. Renowned for its good reputation and professional service capabilities, it has become an important partner for governments, ports, railways, airports, and large multinational companies.
The service network of COSCO Shipping Logistics covers 30 provinces in China and many countries and regions across Europe, America, Asia, and Africa. With over 600 domestic and international sales and service points worldwide, the company’s extensive network ensures that it can provide customers with a comprehensive range of logistics solutions.
Covestro is one of the world’s leading manufacturers of high-quality polymer materials and their components. With its innovative products, processes and methods, the company helps enhance sustainability and the quality of life in many areas. Covestro supplies customers around the world in key industries such as mobility, building and living, as well as the electrical and electronics sector. In addition, polymers from Covestro are also used in sectors such as sports and leisure, cosmetics and health, as well as in the chemical industry itself.
The company is committed to becoming fully circular and is striving to become climate neutral by 2035 (scope 1 and 2). Covestro generated sales of EUR 18 billion in fiscal 2022. At the end of 2022, the company had 50 production sites worldwide and employed approximately 18,000 people (calculated as full-time equivalents).
This news release may contain forward-looking statements based on current assumptions and forecasts made by Covestro AG. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. These factors include those discussed in Covestro’s public reports which are available at www.covestro.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.