This week Union Pacific published its second annual Climate Action Plan – a comprehensive report that outlines the strategic steps we are taking to reduce our operations’ impact on the environment.
The impacts of climate change on the world are becoming increasingly evident. Acute weather events -- from floods to droughts -- can disrupt the communities we operate in and temporarily impact our service levels, with consequences that cascade through supply chains. Long-term changes in weather patterns can also impact our economy.
To better understand how climate change could affect our business, we conducted a climate scenario analysis, which outlines how we view the hypothetical impacts of climate change on our company for both a high- and low-carbon future. This study will help us think through potential strategic responses to both future risks and opportunities arising from climate change.
Regarding opportunities, railroads are well-positioned to help combat climate change. Railroads account for 40% of U.S. freight but only 2% of U.S. transportation-related greenhouse gas (GHG) emissions. As customers seek to reduce their supply chain’s GHG emissions, Union Pacific has the potential to grow our business, becoming the transportation mode of choice for shippers that currently ship via truck. We also see opportunities for revenue growth resulting from renewable energy products and recycled products, feedstocks and infrastructure.
So, how are we doing? Since our baseline year in 2018, Union Pacific has reduced GHG emissions by 18.4%. Although our emissions intensity continues to decrease, we saw a slight year-over-year increase in our absolute emissions driven by increased demand for transportation service and service interruptions. We need to continue taking responsible actions to meet our current and future goals.
As a part of this effort, we joined the Business Ambition for 1.5°C, an alliance of more than 3,000 companies pledged to taking bold action to limit global warming to 1.5°C. As part of that pledge, we committed to the Science Based Targets Initiative (SBTi) to revalidate our short-term target in line with the 1.5°C global warming scenario and develop a long-term, science-based target to reach net-zero value chain GHG emissions by 2050. We will publish both targets after they are validated by SBTi.
Additional 2022 highlights include:
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- Committing to invest more than $1 billion to modernize 600 locomotives through 2025, eliminating 210,000 tons of GHG annually upon program completion,
- Announcing the purchase of the country’s largest carrier-owned fleet of battery-electric locomotives for testing in yard operations,
- Increasing use of low-carbon fuels to over 4% of our total diesel consumption, with a plan to reach 10% by 2025 and 20% by 2030,
- Improving Energy Management System (EMS) utilization to set new records in fuel consumption efficiency,
- Announcing a new partnership with The Nature Conservancy to support three separate nature-based solutions projects, and
- Becoming the first U.S. Class I railroad to become a TCFD supporter.
Addressing climate change is a heavy lift. We know that in addition to doing our part, we must engage all members of our value chain – our employees, suppliers, customers, communities and policy influencers.
I encourage you to read this year’s Climate Action Plan for more information about our company’s strategy and how it connects to our mission of Building America now and in the future.