S/4 HANA Demo Series: 08 – CO₂ Calculation Framework in SAP TM for Sustainable Logistics
Introduction
Calculating CO₂ equivalent emissions is increasingly essential for shippers aiming to meet sustainability goals and regulatory mandates. CO₂ equivalent (CO₂e) is a standardized metric that expresses the impact of all greenhouse gases in terms of the amount of carbon dioxide that would cause the same level of global warming. With many organizations setting carbon reduction targets, CO₂ emission data empowers logistics teams to select lower-emission transport modes, streamline routing, and consolidate shipments. Compliance with standards like ISO 14083 is becoming a baseline expectation, while growing demand for carbon-conscious logistics from customers and partners makes CO₂ emission transparency a competitive differentiator
SAP S/4HANA Transportation Management now includes CO₂ Emission Calculation—a forward-looking feature that empowers logistics teams to align with sustainability goals and meet evolving compliance standards. It enhances operational transparency while driving smarter, more efficient resource use. This feature allows users to define CO₂ emission parameters for various vehicle types, enabling automated emissions calculation during transportation planning. The calculated emissions are seamlessly integrated into the road freight order and displayed within the Transportation Cockpit, providing real-time visibility and valuable insights for planning and decision making. Moreover, SAP S/4HANA TM also supports capturing actual CO₂e values for shipments from external sources (manual or interfaces). This enables comparison between planned and actual emissions, allowing for more accurate reporting and continuous improvement in transportation planning. By quantifying CO₂ output based on vehicle data, logistics teams can meet environmental regulations, drive sustainability performance, and make informed decisions that support green supply chain goals.
Demo:
The demo begins with the creation of two sales orders (different weights) in SAP S/4HANA, which automatically triggers the generation of Freight Units (FUs) in Transportation Management (TM). Planning is then executed in the TM Cockpit using the optimizer, which evaluates vehicle types based on cost constraints and CO₂ emission factors to generate Freight Orders (FOs) and assign carriers. The system-calculated CO₂ emissions are displayed directly in the TM Cockpit alongside each Freight Order. The demo also includes an explanation of the CO₂ emission calculation formula and the methodology used to derive the final value, which is then illustrated in detail during the walkthrough
Once the FO reaches the “Ready for Transportation Execution” status, actual CO₂ emissions can be manually entered. Delivery creation is initiated from the FO back into S/4HANA. Upon confirmation of the final expected event—“Unload End”—the execution is completed, and the CO₂ emission value from the FO is proportionally allocated to Freight Unit items (and thus to the associated Sales Orders and Deliveries) based on weight and distance travelled. This emission data is then reflected in both the Freight Unit and Freight Order, ensuring full transparency across the end-to-end process.
Process Flow:
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