Beyond Carbon Accounting: How Route Optimization Can Transform Your Supply Chain Sustainability

Regulators and consumers are pressuring organizations to develop sustainable supply chains as part of a global effort to reduce the impacts of climate change. To monitor the effectiveness of a company’s sustainability initiatives, organizations might adopt carbon accounting methods that monitor greenhouse gas emissions and report emission reductions to regulators. 

One aspect that companies should include in their sustainability initiatives and their carbon accounting regimens is what that company is doing to reduce indirect emissions from the supply chain. These emissions, also known as Scope 3 emissions, occur when parts, materials, and goods are transported. Scope 3 emissions may actually comprise the largest share of emissions that a company produces, according to a June 2024 report from Boston Consulting Group.

One great way to ensure that an organization is reducing its Scope 3 emissions is to adopt route optimization, which means purposefully determining which routes are the most fuel-efficient and least emitting. Indeed, route optimization is a key strategy to reduce emissions, cut operational costs, and improve overall supply chain sustainability. 

As companies develop and implement their sustainability initiatives, Searoutes, with its technological tools, helps them take their emission reduction regimen to the next level.

The Role of Route Optimization in Modern Supply Chains

Traditionally, route optimization has meant defining the quickest, most efficient, or easiest routes. 

For logistics, effective route optimization enables fuel efficiency and ensures that parts or goods are delivered on time. The converse has also tended to be true: Inefficient routing can lead to higher fuel consumption and higher emissions. 

Technology abounds in helping companies develop optimal route optimization. But one particularly distinctive advancement has been layering sustainability initiatives on top of route optimization. This means using data-driven algorithms to determine the most efficient and eco-friendly routes for shipments. 

Three Key Benefits of Route Optimization for Supply Chain Sustainability

When assessing all the benefits of route optimization, it’s easy to see why it’s a must-have for companies. Route optimization lowers costs, lowers emissions, and encourages the smart management of vehicles and assets.

1. Reduction in Carbon Emissions

One goal of route optimization is to reduce fuel consumption, which in turn reduces emissions because less fuel is used. Lower fuel consumption can result when a company optimizes routes to minimize travel distances and avoid congested areas. 

According to a June 2023 thought piece in Forbes, UPS was able to reduce its carbon footprint through the implementation of routing software dubbed ORION (On-Road Integrated Optimization and Navigation). The software optimized routes by selecting routes with lower traffic and passing through lower-emission zones, thus reducing emissions. According to UPS’ January 2020 update on the software deployment, ORION has saved UPS about 100 million miles and 10 million gallons of fuel per year, and additional planned enhancements would significantly improve upon those results.  

2. Cost Efficiency and Fuel Savings

In addition to lowering emissions, lower fuel consumption directly translates into cost savings, which can be especially beneficial for companies when fuel costs are high. 

A November 2023 review of route optimization benefits by U.S. fleet management company GoFleet found that White Picket Produce, a Florida business that delivers organic produce, saved approximately $4,500 by using routing software to streamline routes. The company also reduced the miles driven, which lowered fuel costs and carbon footprint, according to GoFleet.

3. Improved Resource Utilization

Route optimization also enables companies to improve fleet management and vehicle scheduling so that vehicles are used more efficiently. Better resource utilization is about reducing the number of trips and optimizing the use of available assets so that companies can reduce their environmental impact while maintaining service levels.  

How Searoutes Enables Effective Route Optimization

Searoutes offers APIs that enable companies to intelligently assess and analyze their emissions output. Our technological tools leverage modern algorithms and datasets that go beyond the standard methodologies. We provide CO₂e emissions for transport and powerful routing engines that accurately match the services operated by the carriers.

Here are three ways that organizations will benefit from working with us:

• Advanced Data Analytics: Searoutes uses real-time and historical data to analyze fuel consumption, vessel characteristics, weather, and port congestion to create optimal shipping routes.
• Environmental Focus: Searoutes emphasizes minimizing carbon emissions, fuel consumption, and other environmental impacts in route planning.
• User-Friendly Tools: Searoutes provides an easy-to-use platform that integrates with shippers’ existing systems, offering seamless access to route optimization insights.

We offer three tools to companies that provide valuable insights into how emission outputs vary based on multiple factors, such as vessel size and route. 

Our CO2 API enables companies to conduct optimal vessel route searches and calculate carbon emissions accurately. Our algorithms are grounded by a robust database of historical AIS data and further enhanced with data inputs from over 6,000 vessels and their technical information, as well as carrier schedules, to develop CO2e calculation models.

Our Routing API provides organizations with intelligence on different routes, including their arrival times, fuel consumption and CO2 emissions levels, and deviation costs. It can also give insight on which routes might be the shortest to take, considering factors such as traffic separation schemes, piracy zones, and port entries.

Our Vessel API gives companies grounded insight into the vessels they might use, including the historical trace of a given vessel, its average speed, route characteristics, its current positioning, and its predictive ETA for the next port of call. Knowing all this information about individuals is beneficial for companies seeking to adopt better asset utilization as they deploy route optimization.

Route Optimization and Carbon Accounting are Invaluable Tools

As we’ve seen, deploying route optimization unlocks lower fuel costs and reduced emissions, while implementing carbon accounting enables companies to keep themselves accountable for their GHG emission reductions.

When organizations use Searoutes’ intelligent API tools to fulfill these two initiatives, organizations have an opportunity to advance their sustainability efforts even further. Our API tools enable companies to use a data-driven approach to effectively reduce Scope 3 emissions along the supply chain.

Contact us today to learn how we can help you take your emissions reduction regimen to the next level.