To achieve this goal, the Hamburg-based express logistics service provider is relying on the use of the biofuel Hydrotreated Vegetable Oil (HVO). This will be used to fuel the fleet of vehicles operated on domestic German and trans-European routes. Depending on the location and mission, emission reductions of between 50% and 90% compared to conventional fuel, can be achieved. The somewhat extraordinary name of the new product is ‘OWTZ Boost’. OWTZ stands for ‘Our Way to Zero’.
Togetherness is key
However, filling up the vehicles with HVO is slightly more expensive than diesel fuel. Depending on the country and routes served, the costs go up between 0.20 to 0.40 eurocents per liter, compared to traditional diesel fuel, says Hendrik Bender, CCO Sovereign Speed. Hence, switching from diesel to HVO results in an increase of operational expenditures that the logistics company with its fleet of 300+ vehicles, cannot bear alone. Therefore, the scaling of this well-intended project can only happen with customer support.
LTLS becomes launching customer
A Sustainability Matters Day recently organized by Sovereign Speed in Frankfurt showed that this is manageable. Around 60 customers showed up, including executives of major freight forwarders, airlines, handling agents, truck manufacturers and leading representatives of transport associations. In the meantime, Lufthansa Technik Logistik Services (LTLS) has become the first major OWTZ user. “LTLS is pleased to be a pilot customer in the OWTZ-Boost program. It allows us to achieve important emission reductions directly within our transportation network and take the first steps in the use of renewable diesel – HVO100 – into practice,” states Mareike Krowicki, Commodity Manager Green Team Transport of LTLS. She goes on to say: “We expect HVO to play a central role for us in the coming years in achieving our goal of becoming climate-neutral in our road transportation by 2030.”
Thorough preparation
It took a lot of preparation, consultation with suppliers such as Shell and, of course, business partners before the new product could be launched. Frank Liebelt, CEO Sovereign Speed, recalls: “We started proactively offsetting the unavoidable greenhouse gas emissions originating from our network three years ago. Now we have the opportunity to avoid more and more emissions directly. Hence, our OWTZ-Boost offer to the market is exactly in line with our strategy towards emission-free transportation. However, we will continue to work on our offsetting strategy in the future. Because even when using HVO, there are still climate harming gases that are emitted.”
50% is only an interim target
CCO Henrik Bender emphasizes that customers using the OWTZ-Boost product are guaranteed a CO2 reduction rate of 50% at shipment level for the entire transport from A to Z, compared to traditional diesel burn. To achieve this, Sovereign refuels the required quantities needed within the company’s hub-to-hub network continuously. “However, we want more, because 50% is only an interim target,” the executive says, expecting scaling effects. He reminds that in principle, HVO has a reduction potential of 80% to 90%: “Particularly express logistics service providers have the option of individually increasing the HVO share via a book & claim model and achieving a higher reduction.” The management intends to present the first interim results of HVO and OWTZ-Boost in about three months.
