Climate and Transport

The transport sector accounts for almost one third of Sweden’s total greenhouse gas emissions and about one fifth of emissions in the EU. Globally, the situation is even more extensive – transport makes up around a quarter of all emissions, and the sector is still 95 percent dependent on fossil fuels.

This means that every journey and every freight transport plays a significant role for the climate. For companies, this is a central issue: freight, business travel and logistics solutions all affect emission levels. Transport is therefore not just a necessary part of operations – it is also one of the biggest opportunities to reduce climate impact.

At the same time, pressure is increasing from legislation, customers and investors. Companies are expected not only to deliver products and services, but also to demonstrate how they contribute to lowering emissions. Transport is one area where change can bring rapid and visible climate benefits – while also strengthening brand value and competitiveness.

Different types of transport and their impact

The climate impact of transport varies greatly depending on the vehicle and the type of fuel used. Air travel is particularly problematic. It accounts for about 12 percent of global transport-related emissions, but affects the climate much more than other modes due to high-altitude effects. Flying can generate up to 100 times more emissions than taking the train for the same journey. For companies seeking to reduce their carbon footprint, flights are therefore one of the first areas to review.

On the ground, trains are among the most energy-efficient options. In Sweden, the railway system is almost fully electrified and relies largely on fossil-free energy. This makes trains an excellent choice for both passenger and freight transport. For long-distance freight, shipping is also significantly more climate-friendly than air, although it is still largely dependent on fossil fuels.

For road transport, the differences are substantial. An electric car produces far lower emissions than a petrol or diesel car, especially when powered by renewable electricity. Heavy vehicles, such as trucks, however, account for a large share of emissions. Here, rapid development is underway with, among other things, electrification and the use of biofuels. If fossil-based transport cannot be avoided, trucks running on HVO (hydrotreated vegetable oil) or other biofuels are a better alternative.

For companies, this means that the choice of transport solution not only affects costs, but also the climate and how the company is perceived by customers, investors and employees.

Fuels and the energy transition

A crucial part of the transition concerns fuels. Today, around 95 percent of the world’s transport is still dependent on fossil fuels – petrol, diesel, fossil gas, aviation kerosene and marine oils. These fossil fuels are responsible for enormous greenhouse gas emissions and also contribute to other issues such as air pollution and dependence on oil-producing regions.

For transport to become sustainable, companies must shift to new solutions. This means increasing the use of electricity, biogas, HVO and other renewable fuels. It also means improving energy efficiency in transport, as this reduces the need for both energy and raw materials.

The railway has come the furthest in this transition, and road traffic is following. Car sales in Sweden clearly indicate the direction: during 2023, about 60 percent of all new cars were rechargeable, of which 40 percent were fully electric. For buses and construction machinery, the share of biofuels is high, and the Swedish blending mandate ensures that even fossil fuels sold are mixed with a certain share of biofuels.

For companies, this means there are now more opportunities than ever to choose sustainable transport – and that requirements will continue to grow in the future.

EU rules and policies driving development

Although Sweden’s national blending mandate has recently been lowered, EU legislation will set the pace of transition. The EU has decided that aviation and shipping fuels must gradually become more sustainable. From 2025, a certain share must be renewable, and after 2030 the requirements will increase significantly.

In addition, the EU has introduced a number of incentives and subsidies for electric vehicles, both for individuals and for companies. These include purchase bonuses, investment support for charging infrastructure and funding for research and development. All of this aims to reduce emissions from the transport sector.

For companies operating internationally, it is important to understand that these rules will affect competitiveness. Those already working actively to cut transport emissions will be better positioned as regulations tighten.

How companies can reduce transport-related emissions

Transport is a major part of many companies’ operations – both directly, through their own vehicle fleets, and indirectly, through the movement of goods from suppliers and to customers. There are several ways to reduce emissions:

• Analyze the current situation. Map how large a share of your emissions come from transport, both freight and business travel. This gives you a baseline to measure improvements.
• Increase energy efficiency. Review which vehicles are used, how fully loaded they are, and how routes are planned. Small changes can make a big difference.
• Choose sustainable alternatives. Prioritize fossil-free vehicles and those running on renewable fuels. Require transport providers to use fossil-free options.
• Reduce transport volumes. Coordinate deliveries, plan logistics more efficiently and avoid unnecessary trips. This cuts both emissions and costs.
• Shift modes. Use trains instead of trucks where possible, and shipping instead of air for global freight.
• Encourage behavioral change. Review how employees travel for work. Promote virtual meetings, cycling, public transport and carpooling.

By combining these measures, companies can both reduce emissions and save resources.

Climate and Transport

The transportation sector accounts for almost one third of Sweden’s total greenhouse gas emissions and about one fifth of emissions in the EU. Globally, the situation is even more extensive – global greenhouse gas emissions from transport make up around a quarter of the total, and the sector is still 95 percent dependent on fossil fuels.

This means that every journey and every freight transport plays a significant role for the climate. For companies, this is a central issue: freight, business travel and logistics solutions all affect ghg emissions. Transport is therefore not just a necessary part of operations – it is also one of the biggest opportunities to reduce carbon emissions and environmental impacts.

At the same time, pressure is increasing from legislation, customers and investors. Companies are expected not only to deliver products and services, but also to demonstrate how they contribute to lowering greenhouse gas emissions. Transport is one area where change can bring rapid and visible climate benefits – while also strengthening brand value and competitiveness.

Different types of transport and their impact

The climate impact of transport systems varies greatly depending on the vehicle types and the type of fuel used. Air travel is particularly problematic. It accounts for about 12 percent of transport-related greenhouse gases, but affects the climate much more than other modes due to high-altitude effects. Flying can generate up to 100 times more greenhouse gas emissions than taking the train for the same journey. For companies seeking to reduce their carbon footprint, flights are therefore one of the first areas to review.

On the ground, trains are among the most energy-efficient options. In Sweden, the railway system is almost fully electrified and relies largely on fossil-free energy. This makes trains an excellent choice for both passenger and freight transport. For long-distance freight, shipping is also significantly more climate-friendly than air, although it is still largely dependent on fossil fuels.

For road transportation, the differences are substantial. An electric car produces far lower direct emissions than a petrol or diesel car, especially when powered by renewable electricity. Heavy vehicles, such as trucks, however, account for a large share of greenhouse gas emissions. Here, rapid development is underway with, among other things, electrification and the use of biofuels. If fossil-based transport cannot be avoided, trucks running on HVO (hydrotreated vegetable oil) or other biofuels are a better alternative.

For companies, this means that the choice of vehicle types not only affects costs, but also the climate and how the company is perceived by customers, investors and employees.

Fuels and the energy transition

A crucial part of the transition concerns fuels. Today, around 95 percent of the world’s transport is still dependent on fossil fuels – petrol, diesel, fossil gas, aviation kerosene and marine oils. These fossil fuels are responsible for enormous greenhouse gas emissions and also contribute to other issues such as air pollution and dependence on oil-producing regions.

For transport to become sustainable transport, companies must shift to new solutions. This means increasing the use of electricity, biogas, HVO and other renewable fuels. It also means improving energy efficiency in transport, as this reduces both fuel consumption and demand for raw materials.

The railway has come the furthest in this transition, and road traffic is following. Car sales in Sweden clearly indicate the direction: during 2023, about 60 percent of all new cars were rechargeable, of which 40 percent were fully electric. For buses and construction machinery, the share of biofuels is high, and the Swedish blending mandate ensures that even fossil fuels sold are mixed with a certain share of biofuels.

For companies, this means there are now more opportunities than ever to choose sustainable transport – and that requirements will continue to grow in the future.

EU rules and policies driving development

Although Sweden’s national blending mandate has recently been lowered, EU legislation will set the pace of transition. The EU has decided that aviation and shipping fuels must gradually become more sustainable. From 2025, a certain share must be renewable, and after 2030 the requirements will increase significantly.

In addition, the EU has introduced a number of incentives and subsidies for electric vehicles, both for individuals and for companies. These include purchase bonuses, investment support for charging infrastructure and funding for research and development. All of this aims to reduce greenhouse gas emissions from the transportation sector.

For companies operating internationally, it is important to understand that these rules will affect competitiveness. Those already working actively to cut greenhouse gas emissions will be better positioned as regulations tighten.

How companies can reduce transport-related emissions

Transport is a major part of many companies’ operations – both directly, through their own vehicle fleets, and indirectly, through the movement of goods from suppliers and to customers in global supply chains. There are several ways to reduce greenhouse gas emissions:

• Analyze the current situation. Map how large a share of your ghg emissions come from transport, both freight and business travel. This gives you a baseline to measure improvements.
• Increase energy efficiency. Review which vehicle types are used, how fully loaded they are, and how routes are planned. Small changes can make a big difference.
• Choose sustainable alternatives. Prioritize fossil-free vehicles and those running on renewable fuels. Require transport providers to use fossil-free options.
• Reduce transport volumes. Coordinate deliveries, plan logistics more efficiently and avoid unnecessary trips. This cuts both greenhouse gas emissions and costs.
• Shift modes. Use trains instead of trucks where possible, and shipping instead of air for global freight.
• Encourage behavioral change. Review how employees travel for work. Promote virtual meetings, cycling, public transport and carpooling.

By combining these measures, companies can both reduce indirect emissions and save resources.

Consumer power and customer expectations

It is not only political instruments driving change. Customers – both individuals and businesses – increasingly want to buy from companies that operate sustainably. When people choose local products, pick up parcels at collection points, or select low-emission delivery options, it directly affects how companies must respond.

For companies, this means that sustainable transport is not only a climate issue but also a matter of brand and competitiveness. Demonstrating reduced greenhouse gas emissions, fossil-free vehicles and sustainable logistics is a strong selling point on today’s market.

Conclusion

Transport has a major impact on the climate – both through direct emissions of carbon dioxide and other greenhouse gases, and through its role in society’s energy use. To meet the challenges of climate change, transport-related greenhouse gas emissions must decrease drastically, and companies play a central role in this transition.

By choosing sustainable transport, reducing transport volumes, phasing out fossil fuels and investing in energy efficiency, companies can help build a more sustainable future. At the same time, they reduce environmental and social impacts, strengthen their competitiveness and meet the increasing demands from customers, investors and regulators.

In short: transportation is one of the greatest challenges for the climate – but also one of the greatest opportunities for companies to contribute to real change. For further information, businesses should consult EU policy frameworks, national guidelines, and expert resources on environmental impacts of other vehicle types and logistics solutions.