What Are Upstream Transportation and Distribution Emissions?

Upstream transportation and distribution emissions refer to the greenhouse gas (GHG) emissions generated during the transportation, storage, and distribution of products and materials before they reach your organisation. These emissions occur in the supply chain, specifically from the activities involved in delivering goods from suppliers to your business.

These emissions fall under Scope 3, Category 4 of the GHG Protocol, as they are indirect emissions that occur outside the direct control of the organisation.

Upstream transportation and distribution emissions can include emissions from transporting raw materials, semi-finished products, and components, as well as emissions from third-party logistics providers involved in the shipping and warehousing of these goods.

‍

Upstream vs. Downstream: What’s the Difference?

When it comes to transportation and distribution emissions, it’s important to distinguish between upstream and downstream activities.

Upstream transportation and distribution emissions occur before products reach your organisation. These emissions come from transporting and storing goods, raw materials, or components from suppliers to your business. This includes activities such as shipping, freight, and warehousing by third-party logistics providers.

Downstream transportation and distribution emissions, on the other hand, happen after products leave your organisation. These emissions are generated when you transport goods to customers, retail outlets, or distribution centres. This can include emissions from delivery vehicles, shipping, and warehousing required to distribute the final product.

‍

Examples of Upstream Transportation and Distribution Emissions for Different Types of Businesses

Upstream Transportation and Distribution emissions are relevant across virtually all sectors, including:

• ‍Manufacturers: Manufacturing companies rely heavily on raw materials and components being transported from suppliers. Emissions arise from the trucks, ships, or planes used to move materials such as metals, plastics, or textiles from production sites to manufacturing plants.‍
• Retailers: Retail businesses source finished goods from various suppliers, often located in different regions or countries. Emissions come from the transportation of goods by road, rail, air, or sea to distribution centres or stores, as well as the emissions associated with warehousing.‍
• Food and Beverage Companies: Food manufacturers and restaurants rely on the transportation of fresh ingredients, packaging materials, and beverages from suppliers. The emissions from refrigeration during transport and warehousing are also included, as well as the fuel used in trucks or ships to move goods from farms and factories to distribution centres.‍
• Healthcare Providers: Hospitals and clinics purchase medical supplies, pharmaceuticals, and equipment that often need to be transported from multiple suppliers. Emissions come from air freight, road transport, and the storage of temperature-sensitive medical products.‍
• E-commerce Businesses: E-commerce companies rely heavily on upstream distribution for sourcing products from various suppliers. Emissions are generated from transporting products from manufacturers or warehouses to fulfilment centres, often involving complex global logistics chains.

‍

Benefits of Measuring Upstream Transportation and Distribution Emissions

Measuring emissions from upstream transportation and distribution provides several key benefits for organisations. Firstly, it gives businesses a clearer understanding of their full carbon footprint. Since upstream transportation can account for a significant portion of a company’s emissions, especially in industries heavily reliant on logistics and distribution, accurately tracking these emissions is critical for comprehensive reporting.

Secondly, by understanding where emissions are coming from, organisations can identify inefficiencies in their supply chain. This could involve optimising delivery routes, consolidating shipments, or working with suppliers to switch to lower-emission transportation modes. These changes can reduce transportation-related emissions and potentially lower costs through improved logistics and fuel efficiency.

Additionally, measuring these emissions supports sustainable procurement practices. Organisations can favour suppliers that use cleaner transportation methods or operate energy-efficient warehouses. This creates a more sustainable supply chain and can help meet corporate social responsibility (CSR) goals and sustainability commitments.

Finally, measuring upstream transportation and distribution emissions enhances transparency and accountability, showing stakeholders that the organisation is taking proactive steps to reduce its environmental impact. This can improve brand reputation, strengthen relationships with environmentally conscious customers and investors, and support compliance with emerging regulations that require businesses to report their Scope 3 emissions.

‍

How FutureTracker Can Help

FutureTracker provides comprehensive support for organisations in every aspect of measuring and managing their emissions, including upstream transportation and distribution emissions. Our emissions calculator and guidance library simplifies the process, making it easy for your organisation to identify sources of emissions, quantify their impact, and develop targeted strategies to reduce them effectively.

If you’d like to learn more about FutureTracker, get in touch with us at enquiries@futuretracker.com or learn more about our plans and pricing here.