With Book & Claim, a quantity of sustainable fuel can be ‘booked’ in one location and ‘claimed’ at another location that is physically not linked to the original one. Gain insights how logistics companies can unlock new business opportunities.
Following this approach, carriers and logistics service providers (LSPs) can offer their customers – those shipping products – new auditable green freight services. With Book & Claim (B&C), the companies can market sustainable investments in their fleet and transport structure such as low-emission fuels or battery-electric propulsion via certified accounting. These records enable accurate accounting of greenhouse gas emission reductions.
The freight demand, according to the ITF Transport Outlook 2023 report, is projected to roughly double by 2050 compared to 2015. There has been a raft of technological advancements to reduce emissions in transportation, although the widespread adoption of these is still challenged by various barriers: For instance, due to limited supply of sustainable aviation fuels (SAF) and hydrotreated vegetable oil (HVO), the demand remains low. Factors include high production and distribution costs, significant investments required in low-emission vehicles (particularly in the maritime industry), geographical disconnection between fuel producers and consumers, and the complex nature of supply chain networks.
Why Book & Claim?
Considering these challenges, Book & Claim is viewed as a promising approach for transport and logistics companies to reduce greenhouse gas (GHG) emissions. The model directly tackles the strains of limited supply and high costs of alternative fuels by enabling their use wherever possible, while distributing the associated costs and emission reductions to relevant stakeholders. In this way, Book & Claim can act as a re-financing mechanism of transformation costs to alleviate the difficulty of decarbonization.
The overall goal is to enable higher demand for low-emission fuels in transportation, and the accurate and traceable accounting of such interventions. As a chain of custody model, Book & Claim tracks specific product characteristics such as feedstock, origin and energy emission factors, as they travel through the supply chain from source to end consumer.
Pioneers in the development of the B&C model – e.g., Smart Freight Centre, Roundtable for Sustainable Biofuels and the World Economic Forum’s Clean Skies for Tomorrow initiative – see it as an effective means of addressing climate-related challenges in logistics. In 2023, the Smart Freight Centre released an accounting framework to accelerate the uptake of low emission transportation solutions and services. The Voluntary Market Based Measures Framework for Logistics Emissions Accounting and Reporting is a cross-modal guidance for marketable road, maritime and aviation reduction claims and specifically based on a B&C chain of custody approach.
What does “book” and “claim” mean?
Book & Claim decouples the characteristics from the physical product. The system is particularly useful in scenarios where sustainable options – such as biofuels or electric vehicles – are available in one form of transport due to restrictions, like availability in one country, but not in another.
For example, imagine a company that operates international transports between Country A, where sustainable biofuels are readily available, and Country B, where only conventional fuels can be used. In Country A, the companies’ vehicles run with biofuels for its shipping operations, reducing a significant amount of carbon dioxide equivalent (CO2e) emissions compared to what would have been emitted using conventional fuels. These reductions are quantified into claim units of reduced CO2e.
Through the Book & Claim system, the company can apply these claim units to distribute sustainable interventions evenly throughout their transport network. This way, corporations can still meet their sustainability targets and contribute to global emission reduction efforts, despite geographical disparities in sustainable fuel availability.
Whereas claim units can be transferred to parts of one company’s operations where sustainable options are not available, the B&C model above all aims at transport and logistics companies with joint transport activities or supplier relationships for logistics services to ‘book’ and ‘claim’ emission reductions within the supply chain and same mode.
Book & Claim can help to solve the mismatch between supply and demand for low emission fuels. Sustainable fuels might be used where there is a supply and allocating the benefits and costs to where there is a demand.
Book & Claim: what’s in it for carriers, LSPs, and shippers
The system is beneficial for various stakeholders in the supply chain, including transport service providers, fuel suppliers and transport buyers. With Book & Claim, all parties involved can achieve and report on their sustainability targets effectively.
Benefits for carriers and Logistics Service Provider (LSPs):
- build low-emission marketable products to offer sustainable transportation and services
- share emission reductions with the network and freight owners who are willing to pay for scope 3 transport reductions
- improve low emission fuel availability and affordability
Do you work for a carrier or LSP and want to find out if Book & Claim is relevant for you and how you get started, please read our short article “When and how carrier and LSP should act with Book & Claim”.
Benefits for shippers:
- freight owners can reduce their emissions
- flexible availability of low-emission transport services and sustainable fuels
- freight owners can claim traceable and verifiable GHG emissions reduction benefits
What are technical requirements for Book & Claim?
Your company needs to maintain a chain of custody reporting system that includes evidence of fuel characteristics, transportation services, and other relevant data. This information ensures the transparency and accuracy of emissions reporting.
A full-fledged solution consists of three components:
- Sustainability Certification System (e.g., International Sustainability and Carbon Certification ISCC or Roundtable on Sustainable Biomaterials (RSB)): a tool to establish and track the sustainability profile of the fuel, including its GHG emission factor
- Registry: a tool or database that registers, verifies, and tracks the transfer of a sustainability profile of a fuel or transportation service according to a transparent and verifiable registry standard, and complying with associated rules for the transfer
- Accounting System: described principles in the Voluntary Market Based Measures Framework define the accounting and allocation of emission reductions in organizational GHG inventories, either provided by external solution providers or internally built
What kind of evidence is needed for a validated Book & Claim certificate?
Evidence includes details of the fuel consumed, such as a proof of sustainability, fuel certificates, purchase records, and energy content data. It is beneficial if companies also track the specifics of each shipment, including the mode of transportation, the transport activity, and the emission intensity.
Characteristics of fuels:
- Energy content, mass, or volume of the fuel
- Life Cycle GHG emission factor of the fuel
- Feedstocks (incl. % of biogenic material)
- Date and location of fueling event
Characteristics of transportation services:
- Mode of transport
- Transport Operation Category (where applicable)
- Transport activity (tkm)
- GHG Intensity of the Low Emission Transport Services (LETS)
- Total GHG emissions of the LETS
- Validity of LETS reductions available for booking (12 months)
Characteristics of a fuel proof-of-sustainability:
Mandatory:
- Name/type of product
- Type of raw material / feedstock
- Energy emission factor of the renewable energy source
Recommended:
- Energy emission factor of the fossil baseline
- Country of origin
- Supplier name
- Certification scheme compliant with RED II (e.g., REDcert, ISCC, RSB)
- Certificate Validity
Conclusion
The Book & Claim system presents an attractive option for companies seeking to adopt sustainable practices, as it offers an easy entry with no infrastructure or transportation requirements and is not restricted by physicality. For producers of sustainable fuels, it can generate a reliable source of demand, thus promoting competition and potentially lowering prices.
To learn how your company can benefit from Book & Claim, please get in touch with one of our industry experts.
You want to dive deeper into Book & Claim? Please download our whitepaper (German language).
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