Eric Joiner's Freightdawg.com - The Logistics and Supply Chain Blog!

BNSF introduces Carbon Footprint Estimator

CSX has made a big deal about the greenness of rail transportation for awhile now, advertising the economic value of rail vs truck transportation.  BNSF has gotten into the act now with a new tool for estimating carbon savings on specific routes and rail consists.   The tool they developed is a bit more sophisticated than a similar tool that CSX put out several months ago.    Check the BNSF tool out here.

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BNSF Runs the Ethanol Express

Burlington Northern Santa Fe Railroad moves a lot of ethanol. With major track ownership in the US midwest, BNSF is a prime mover of corn and corn related products. Unit trains of ethanol move to market regularly with BNSF operating a key unit train to Dallas called the Ethanol Express.

Warren Buffet has invested a lot of money in BNSF as well as other railroad assets such as Union Tank Car. (UTLX).

BNSF Expands Ethanol Express to Dallas/Fort Worth FORT WORTH, Texas and OKLAHOMA CITY, Okla., Oct. 9, 2008: BNSF Railway Co. today announced that it will begin delivering unit trains to Musket Corporation's newest ethanol storage terminal on Nov. 1. With storage capacity of 10 million gallons, the Dallas/Fort Worth Musket Ethanol Terminal is one of the area's largest ethanol storage facilities and is designed to meet the daily needs of the Dallas/Fort Worth Metroplex. Located in the Mark IV industrial area in North Fort Worth, the facility maintains its own rail spur and is designed to completely unload a unit train of 95 cars every 24 hours. Tank cars are drained via an underground piping system and ethanol is pumped directly into the four storage tanks. The ethanol can then be pumped directly into trucks for local distribution. The new facility will receive shipments exclusively from BNSF Railway's Ethanol Express a 95-car unit train service specifically created to move ethanol from a single origin or gathering place to a single destination. The Ethanol Express will save ethanol producers and end-users time and money through increased fleet utilization, lower inventory carrying costs, and logistics coordination and support each and every day around the clock. BNSF moves more than 370 million gallons of ethanol per year through the Ethanol Express program.

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CSX Trip: Windy City Follow Up!

On October 7th, I and a number of other bloggers had a unique chance to visit with CSX Railroad management in Chicago. CSX invited a number of social media folks to come to Chicago to see their newest genset locomotive technology, as well as to provide access to CSX's communications and operations staffs.   About 15 people from sites such as Ars Technica, mattgoesgreen.com, ecollo.com, travel, trains and other things and others visited the CSXT intermodal railyard and got schooled on both Chicago local operations and how railroads work. I was the only logistics geek there, but that's good for freightdawg.com!

CSX is spending considerable money on establishing their brand and their mode of transportation as an efficient and eco-friendly way to transport goods.   That's not a touchy-feely thing as much as a solid approach to new media as part of a multi-media advertising campaign.  CSX advertisements directly claim that rail transportation is an efficient and environmentally friendly way to move goods.

By inviting professional and industry related bloggers to come see for themselves, CSX is underscoring their branding while providing legitimacy to their environmental investments.    Bloggers are usually good at unvarnished opinion. CSX has provided key bloggers with direct access to their communications teams for information when needed, as well as taking influential bloggers on site to see how the business operates.   This a very sophisticated approach for an old school transport mode and shows tremendous understanding of how Internet social media works.

Check out this link to mattgoesgreen.com and the pics and video Matt Trachtenberg took.    Personally, I got to meet some new and very smart people who are covering the Green side of business today. A very nice way to spend 2 days of vacation time!

Eric

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Green Communication: CSX Gets it.

I'm amazed. A Class 1 freight railroad is actively advertising in the United States on radio, the internet and in print media. When I first saw this it drew my immediate curiosity. My initial thought was "Who will read this stuff then act on it in a way that generates revenue for the railroad?"

How many housewives buy rail traffic?  Who is the target audience? Whatever the reason, I paid attention because something unusual was happening in the executive suite of an old school transportation business. I just didn't know what it was.

Then I got an email. 

CSX was inviting ME to come to Chicago to attend a conference as well as to see their latest ecological and energy efficient equipment and operations.

The conference is the EPA Climate Leaders Conference in Chicago next week. CSX Railroad is investing heavily in communicating it's biggest value proposition. Railroads are both clean technology and the most efficient way to move product to market.

Railroads compete mainly against trucks. The bigger the load and the longer the haul, the more railroads present value to shippers. CSX has produced an on-line carbon calculator to allow shippers to compare distance and load vs. mode of transportation to determine transport efficiency.

CSX gets both its value proposition to freight shippers, but also to environmental groups.   I got invited to join a group of bloggers from a broad spectrum of interests.  These include transportation, technology, the environment and current events/news. Blogger attendees will tour the Chicago rail yard, see CSX's latest GenSet Locomotive, and attend a dinner meeting with senior CSX executives.  Other on-line attendees include Ars Technica, Trains For America and Green Living.

CSX's communications and marketing teams are carving a new branding niche.  Not only are they investing in traditional media to send their message, they are investing in both traditional and new on-line media. Lets face it, anybody with an audience can influence stock prices. Bloggers have a role in this.

CSX has really gone cutting edge in addressing this market by educating bloggers on what they are doing.  If bloggers from a wide range of interests consider railroads an efficient transport medium, then the public perception of railroads will change.  BNSF, NS and others owe CSX a debt here I think!

For an old school transportation medium, I congratulate CSX on how well it understands the branding opportunity that the net and industry bloggers offer. I've spent 25 years in the transportation business working with heavy iron in modes ranging from containerships to B747's.

I'm looking forward to some steel wheel love.

Eric

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Where Ships go to Die.

This is an interesting video that appeared on the American television show "60 Minutes" back in 2006.  It shows how old merchant vessels are beached and cut up in Bangladesh.  Ship breaking is a dirty, filthy job, done by the poorest of the poor. Conditions are somewhat improved now thanks to this story, but this is how the vessels of commerce go to die in the east.

These old ships are filled with asbestos, chemicals, fuel and other contaminants that just wind up on the beach and in the ocean. This struck me as a sharp contrast to the conversion of the American aircraft carrier USS Oriskany, which was so carefully sanitized prior to sinking as a man-made reef and diving attraction.

Somehow, I dont think the 11,000 TEU, 170,000 metric ton, M/V Emma Maersk will be driven on any beach when her trading days are over.

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Wind Power: An intermediary Step?

Freightdawg.com is a blog about logistics and supply chain. The thing is that supply chains have become so tied to fuel expenses that inevitably I wind up writing more and more about energy.

Lately I have written quite a bit about the value and possibilities of wind energy. It is among the purest forms of electrical generation. The problem is that wind isn't constant, even in the most turbulent locations. Just to have a wind farm in a given location, the wind has to blow at least 13.5 mph on average.

I looked it up with the National Oceanic and Atomospheric Administration (NOAA).  There are not a lot of places with this much wind. Wind generated power is also limited by the fact that wind energy must go directly into the power grid for consumption regardless of demand. Wind energy cannot be stored.

The article below is a very good one from the Dallas Morning News today.  It discusses these limits as they relate to west Texas. The thing that struck me about this article though is that the majority of thought is related to the infrastructure needed to get the energy to points of consumption. Namely, building the power grid.   

What if...instead of building massive power lines and related corridors, wind energy were converted to potential energy in the form of hydrogen, or some other intermediate fuel? My thought process is incomplete here, but it goes to another article I wrote the other day on the need for a divergent, multi-faceted energy policy. None of the bio-fuel type alternatives is a panacea. 

I find myself thinking a lot about this stuff lately. I'm convinced we borrow this planet from our children.  This energy thing is something that needs to be cured, both as a national, strategic issue but as a global one.

clipped from www.dallasnews.com Debate flares over wind power in Texas 12:28 PM CDT on Sunday, July 6, 2008 By ELIZABETH SOUDER There is such a thing as too much wind power. Sure, wind is among the cheapest, cleanest fuels generating the power Texans increasingly demand. But as officials brag about the state's status as the No. 1 wind producer in the country, they're also debating how much is too much. Building the transmission lines to bring wind power from rural West Texas to population zones will cost billions. And even with enough transmission lines, the on-again, off-again nature of wind can leave coal and natural gas-fired power plants scrambling to fill in the gaps For electricity companies, predicting wind patterns is a new art. The wind blows hardest before the sun comes up, when people aren't using much power. It tends to die down during the afternoon – especially in the summer – just when people demand more juice. Wind developers say wind power is so cheap that the cost to accommodate it is negligible. Coal, nuclear and natural gas plant owners doubt it. "As we add more and more wind, there are some uncertainties and some costs," said Thad Hill, head of Texas operations for NRG Energy, which operates coal, nuclear, gas and wind plants in Texas. "The important thing is, when we decide how much wind is the right amount, that we make that decision understanding these costs," he said. Paul Sadler, executive director of advocacy group the Wind Coalition, said wind must be accommodated fairly, and technology exists to do so. "Integration of wind is not sending a man to the moon," he said. "It's just a matter of having the will to do it."

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Fueling America: We need a Strategy.

This week we celebrate Independence Day in America. Ironically, we're more dependent than ever before.  We live in a global economy where the lines between independence and interdependence blur noticeably.

There are many circles through which the world is linked.

This week the NY Times ran an interesting article on why flooding in the upper mid west might have a big impact on the price of fuel in the future.

Floods that wipe out corn crops limit the availability of raw stock to be converted into ethanol, thus driving up the price of fuel.  Corn is a less-than-attractive base for ethanol because it is a primary feedstock for cattle and poultry.  When there isn't enough corn to feed the livestock,  the price of food goes up, not only in transportation, but in the basic cost of protein. Because the US exports considerable amounts of beef and poultry, the rain in Iowa can drive up the cost of chicken in Shanghai.

America needs a diversified, comprehensive energy strategy. Ethanol is part of it, but needs to be based on high efficiency raw stocks like switch grass, which do not compete for food resources.  We also need sources of renewable energy that aren't so highly influenced by weather.   Hydrogen is one such source, if derived from wind energy and water.  Syn fuels such as Dimethyl Ether (DME) produced from coal is another. Part of the strategy might be to lower import taxes on Brazilian ethanol.   Frankly it would be good for the Americas if the US had another major energy source other than Venezuela in this hemisphere.

The United States needs a combination of fuels and production methods that allows the country to leverage our assets such as coal, farming efficiency and technology to get away from imported oil. This is the number one issue in America to me.  Democrat or Republican, whomever has the best strategy for energy will get my vote in November.

I see this as a national issue deserving of the urgency that John F. Kennedy put into putting a man on the moon. We need a combination of academia, industry and government to push this forward.

Research universities to help do the pure R&D, Industry to develop the fuel, farmers to grow the feedstocks, Industry again to create the vehicles to consume the new fuels Congress to give tax credits to help fund the development and the transportation industry to move it all around. We also need the Environmentalists.   

Environmentalists, mind you not the crazies, but science based groups to not only watchdog the development, but also to help industry and government identify the natural impacts of green development.  Things like working with wind turbine makers to help identify bird and bat species that might be killed or injured by the blades. Designs that are complimentary to nature need to be developed and deployed.   Raptors are particularly susceptible. Fewer raptors means more rats. More rats means less corn.  Less corn...less ethanol.   Its a circle.

This is the key strategic issue for the 21st century.  We have no need to be in the Middle East when we can fuel America at home.

Eric

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Finding Cheap Fuel with Gasbuddy.com

Are you as sick as I am of paying ridiculous fuel prices?  I was in Milwaukee this week and filled up the rental car at $3.70 a gallon.

I was Appalled

Gas in Atlanta is $3.39 and I think that's still exorbitant. With the oil companies raking in billions of dollars in profits, this is one issue that truly may sway my vote in November.  Energy costs have gotten out of hand in the United States.  They've been even higher in Europe for years.   Until the macro economic conditions allow for cheaper fuel at the pump, the best we can do is find the cheapest fuel available locally, then use it as wisely as possible.  That's where an excellent web site called Gasbuddy.com comes in.

Gasbuddy.com aggregates fuel prices from hundreds of fuel stations in the US and Canada and publishes a dynamic feed of gasoline prices in your local area, complete with Google-type maps and temperature maps that show fuel prices across the continent.  You can choose pricing options for all grades of fuel including diesel. Gasbuddy.com also provides helpful tips of fuel conservation, as well as historical data to track fuel pricing in your local area or area of interest.   Bloggers can embed Gasbuddy.com maps and highest/lowest pricing lists in your site as an RSS feed.

If ran a number of full line DC's with my own private fleet of trucks, tools like Gasbuddy.com would be an asset in figuring out where to source goods for maximum fuel savings.

Eric

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DHL Goes Green in Asia

Green supply chain programs are growing in popularity and public interest. Corporations are reacting by looking at how to implement a more environmentally friendly way to move material through their network. With carbon credits now being actively traded in Europe, that trend is only going to get bigger.

Pressure on transportation providers to deliver green solutions intensifies with each new Request for Proposal and may become key vendor selection criteria. The information below from DHL discusses the GO GREEN Program that DHL has enacted in Europe and now Asia.

Parcel Industry News

DHL Introduces Industry-First Carbon Neutral Shipping Service in Asia Pacific "Sustainability is increasingly a critical part of DHL's leadership philosophy," said Dan McHugh, CEO of DHL Express - Asia Pacific. "In addition to looking at how we can manage our own environmental footprint, we want to provide our customers with products and services that allow them to reduce their environmental impact. A first-in-the-industry, DHL GOGREEN EXPRESS is an easy-to-use carbon neutral service that aims to directly address the climate change challenge." DHL GOGREEN EXPRESS is part of the GOGREEN range of carbon-neutral and low-carbon shipping options already available to DHL customers in Europe. The service was first launched in  January 2007 at the World Economic Forum in Davos to help the Forum achieve its carbon neutral commitment. In Asia Pacific, the service will be available in 17 countries across the region over the course of this year. With this value-added service, DHL aims to meet the demands of customers who are looking for a more environmentally-responsible shipping option. Through customer payment of an additional 3% 'green premium' on top of standard delivery charges, DHL calculates the carbon emissions generated by transporting each specific customer shipment from the country of origin to destination, and offset these emissions by reinvesting in certified carbon management programs such as alternative fuel vehicle technology, solar panels and reforestation projects.  These projects have been identified via DHL's dedicated carbon management function, with an aim to compensate the emissions generated when transporting customers' shipments across the globe. Customers can choose to send all or a selection of their international shipments as part of DHL GOGREEN EXPRESS. To ensure accountability and transparency, the program is annually verified by an independent certifying body - the Swiss-based Société Générale de Surveillance. In addition, customers will each receive an annual certificate from DHL stating the total amount of CO2 which was offset on their behalf during the year. The certificate serves as a useful environmental reporting tool for companies working to reduce their CO2 emissions created during transport. In other recent environmental sustainability initiatives in Asia Pacific, DHL has introduced bio-fueled or hybrid vehicles in its various markets. For example, in India, DHL Express is operating over 200 Compressed Natural Gas (CNG) vehicles. In Japan, DHL Express is actively encouraging "Green Logistics" through a combined use of hybrid vehicles, Fuel-Cell cars and bicycles in its operations network. DHL's freight forwarding business also achieved certification for Environmental Management System ISO14001:2004 across its entire operations in Asia Pacific, covering 188 locations in 15 countries. This makes DHL Global Forwarding the first and only freight forwarder to achieve full umbrella certification for Environment Management System ISO14001: 2004 in Asia Pacific.

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Product Quality Control and Supply Chains

The video below is truly eye opening relative to testing and toxicity quality control for products in made in Asia. US and other western retailers, reacting to public and governmental demands for safe, usable goods, are mandating that their suppliers in Asia meet market safety standards. The reality is that tier 1 vendors have their own sub-vendors, whether of component parts, or raw chemicals. Auditing and controlling the quality of those sub-vendors is often next to impossible.

Melissa Brown of the Association for Responsible and Sustainable Investment in Asia (ASRIA) discusses challenges of the Chinese supply chain and the needs for proactive responses by investors and companies. The auditing and safety aspects of international sourcing puts tremendous pressure on supply chains. This is one reason why more and more companies are considering a return to sourcing in the US or in other markets where quality and toxicity are more controllable.

The video below runs a little long at 15 minutes, but is well worth the time.

(Note: Some corporate proxy servers ban video from youtube.com.  If you see white space below...you may be on such a network.  Please revisit from home or a connection that does not go through your company VPN.)

Eric

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