Operational Excellence

Climate Change


Operational Excellence
Climate Change

Manage energy consumption, including fuel, to improve energy efficiency and reduce emissions.

Why It Matters

Transportation of freight by railway is a key component of the transition to a low-carbon economy in North America. Implementation of our precision scheduled railroading model enables CP to operate safely and efficiently, in turn reducing our energy use and GHG emissions.

IMPACT ON CP

Diesel fuel is one of CP's largest operating costs, and CP's locomotive fleet consumes more than 92% of the fuel needed to run business

RAIL VS. TRUCKING1
Rail is four times more fuel-efficienct than trucking, has 75% less GHG emissions, and a single-unit train keeps more than 300 trucks off public roads.


CP considers locomotive fuel efficiency to be the most important element for both operating cost-effectively and reducing our carbon footprint. As such, our drive for energy efficiency and emissions reduction focuses on improving fuel economy in our locomotive fleet and freight transportation operations. In 2019, we reduced fuel consumption and emissions and achieved our highest fuel efficiency to date, which is 13.8 percent2 lower than the North American Class 1 freight railway average. Simply put, our ability to drive fuel efficiency for our business as well as our customers differentiates CP from the competition.

The Environmental Benefits of Moving Freight by Rail, published by the Association of American Railroads in July 2019; Sustainable growth: Railroads aim to pull more freight off the highway, published June 2016; How railways can be part of Canada’s climate change solution, published by the Railway Association of Canada in July 2016.
This calculation is derived from publicly reported 2019 fuel efficiency of North American Class 1 freight railways compared to CP’s fuel efficiency performance for the same period.
 

43

%

improved locomotive fuel
efficiency since 1990

RELATED RESOURCES

Our Approach

Multiple departments across CP’s business collaborate to analyze technologies, develop and implement various energy efficiency and fuel reduction initiatives, and monitor and report on performance. To support this work, CP re-established a cross-functional Fuel Conservation team in 2019 to drive discussions related to long-term fuel management objectives. Due to the importance of fuel efficiency on CP’s overall carbon footprint and bottom-line performance, key indicators related to fuel efficiency are indirectly linked to the annual bonus compensation for operating executives in our compensation program, including our President and CEO.

To facilitate ongoing performance improvement, CP works diligently to optimize our energy consumption and reduce costs related to locomotive fuel consumption. We set company-wide targets to reduce our impact and continue to comply with relevant environmental laws and regulations. Since 1990, we have improved our fuel efficiency by 43 percent.

EMISSIONS PERFORMANCE STANDARDS

CP’s active locomotive fleet operates across our North American network. We carefully maintain and regularly test all locomotives to meet the emissions regulations set by Environment and Climate Change Canada and the U.S. Environmental Protection Agency to allow for fluid movement across the Canada-U.S. border. CP’s train crews also receive regular training on operating practices and technologies designed to improve fuel economy.

CP regularly engages with regulatory agencies, equipment manufacturers and other railways to discuss emerging issues and opportunities related to air emissions from our locomotive fleet. For example, CP has members on both the Association of American Railroad’s Locomotive Committee and the Steering Committee for the Locomotive Emissions Monitoring program, a joint initiative of the Railway Association of Canada and Transport Canada. The goal of these groups is to reduce the railway industry’s air emissions, including GHG. These collaborative efforts have resulted in significant improvements in locomotive fuel economy while driving industry-wide reductions in air pollutants and GHG emissions.

CP Completes Installation of Solar Energy Farm

CP is proud to announce the completion of the solar energy farm installation at its Calgary headquarters. The project is one of the largest private solar farms in Alberta and is expected to generate more power than consumed annually by the main headquarters building.

James Clements, Senior Vice-President Strategic Planning and Technology Transformation officially inaugurated the project March 31.

“This project is a testament to the ongoing commitment CP has made to reduce the environmental footprint of our business operations,” said Clements. “Sustainable business practices are important in our fight against climate change and should take into consideration the ability to meet our needs, without jeopardizing the future of generations to come.”

The solar energy farm will generate up to five megawatts of electricity while avoiding an estimated 2,600 tonnes of carbon emissions a year, equal to taking approximately 570 cars off the road. The project will reduce CP’s total scope 2 emissions footprint. Scope 2 emissions are indirect greenhouse gases emitted from sources that are owned or controlled by an organization. For CP, scope 2 emissions are generated during the production of electricity purchased from local utilities.

Construction of the solar farm began in October 2020 with utilities being placed into the ground before winter weather settled in. The completed installation spans approximately five hectares and provides covered parking for up to 500 employee vehicles. Four electric car-charging stations with the ability to fully charge most electrical cars in up to five hours were also added to provide employees with quick and efficient access.

“We are excited about how this project positions CP as a sustainably driven company,” said Glen Wilson, Managing Director Environmental Risk, Regulatory and Environment. “CP is being increasingly recognized globally for its sustainability practices and the conversion of our headquarters building to solar power is a very strong and visible indication of our commitment to climate action.

How it works: (1) Solar panels installed at CP’s Calgary headquarters. These photovoltaic cells convert sunlight into direct current power. (2) Inverters are used to convert direct current power from the solar farm to alternating current. (3) The inverters feed electricity into CP’s electrical distribution system, which powers the main headquarters building. (4) The bi-directional meter keeps track of energy imported from the grid. (5) The campus remains connected to the utility grid. 

Read more in Energy Efficiency & Emissions.

CP’s Hydrogen-Powered Locomotive Pilot Project

On December 18, 2020, CP announced that it plans to develop North America’s first line-haul hydrogen-powered locomotive. CP’s Hydrogen Locomotive Program will retrofit a line-haul locomotive with hydrogen fuel cells and battery technology to drive the locomotive’s electric traction motors. Once operational, CP will conduct rail service trials and qualification testing to evaluate the technology’s readiness for the freight-rail sector.

“This is a globally significant project that positions CP at the leading edge of decarbonizing the freight transportation sector,” said Keith Creel, CP's President and Chief Executive Officer. “CP will continue to focus on finding innovative solutions to transform our operations and adapt our business, positioning CP and our industry as leaders for a sustainable future.”

The work builds on CP’s prior experience with testing low-emitting locomotive technologies, including biofuels, compressed natural gas and battery-powered solutions. Nearly the entire freight locomotive fleet of all railway operators in North America consists of diesel-powered units, representing the industry’s most significant source of greenhouse gas emissions. CP has long focused on energy-saving initiatives as a core component of its sustainability practices. Since 1990, CP has improved its locomotive fuel efficiency by more than 40 percent through a variety of programs and technology deployments designed to improve fuel economy and reduce air emissions. The application of leading practices, emerging technologies and relationship building across the value chain and industrial sector will remain critical as CP addresses the climate change challenge.

Read the full press release here, and our Climate Change Statement here.

Read more in Climate Change.

Meet Our Team

Click on the photos to learn more about each member of our Hydrogen Locomotive Program team.

Kyle Mulligan
Chief Engineer, Railway Technology
Gary Wong
Project Engineer
Veronika Kowalczyk
Engineer in Training, Railway Technology
Milan Dubinsky
Senior Power and Control Engineer
Matthew Findlay
Director, Locomotive Regulatory and Finance
Cody Fischer
Systems Engineer, Railway Technology
Kyle Mulligan
Chief Engineer, Railway Technology

As Chief Engineer, Railway Technology, Kyle Mulligan leads a talented team of railroaders to deliver CP’s groundbreaking Hydrogen Locomotive Project.

Kyle has a doctorate (Ph.D.) in mechanical engineering from the University of Sherbrooke, in addition to two degrees in computer systems and electrical and biomedical engineering.

What does sustainability mean to you?

“Sustainability to me means doing the right thing, not the easy thing. The Industrial Revolution enabled a comfortable way of life, but that does not mean we can take it for granted. There are more efficient, cleaner and environmentally-friendly ways of achieving the same standards and goals in life. Everyone plays a part, from composting and recycling to turning off the lights. The technology CP is working on is clear proof that a sustainable future is achievable.”

How does it feel to be at the forefront of developing North America’s first hydrogen-powered line-haul freight locomotive?

“Every day is a gift. We are truly blessed to be a part of a project that is helping to change the world and to have the confidence from our leadership that we can do so. I am personally humbled and proud to be a part of this project.”

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Gary Wong
Project Engineer

As Project Engineer, Gary Wong is involved in all aspects of CP’s Hydrogen Locomotive Project — from concept to implementation to testing and verification.

With extensive experience gained in various oil and gas technical roles and international experience, Gary is passionate about applying his expertise and knowledge and leading the hydrogen locomotive team to success.

What do you find most exciting about the project?

“I enjoy the technical and commercial aspects of the job, as well as being able to provide guidance and leadership to the team on problem-solving, building the locomotive, working with new suppliers and shaping the future vision for the project.”

How does it feel to be at the forefront of developing North America’s first hydrogen-powered line-haul freight locomotive?

“CP is a historical company, and similar to the transition from steam to diesel nearly a century ago, as an engineer, I am proud and excited to be at the forefront of new technology and play a direct role in this history-making project.”

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Veronika Kowalczyk
Engineer in Training, Railway Technology

A recent graduate from the University of British Columbia with a degree in mechanical engineering, Veronika Kowalczyk is a valued member of the team responsible for the development of North America’s first hydrogen-powered freight locomotive.

She is passionate about all things sustainability and eager to take part in the development of alternative energy innovations.

What does sustainability mean to you?

“It means investing in the future and conserving our scarce resources so future generations can use them and experience some of the great things we get to enjoy today.”

How does it feel to be at the forefront of developing North America’s first hydrogen-powered line-haul freight locomotive?

“It feels unbelievable. I cannot help but smile when I think about where I am and where CP is heading with this program. I cannot begin to describe the excitement I feel when I think about this project and the milestones we have yet to achieve. I feel very lucky to be developing this prototype with such a talented team of people and to be able to learn so much from them as an engineer who is just starting her career.”

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Milan Dubinsky
Senior Power and Control Engineer

As Senior Power and Control Engineer, Milan Dubinsky is responsible for developing and building the power and control system for the groundbreaking hydrogen-powered locomotive.

Milan holds a Master’s in engineering and a Ph.D. from the University of Kosice in Slovakia and brings 12 years of international experience from Europe to the team.

What do you find most exciting about the project?

“I feel like we are taking part in creating a better future. We are already seeing a shift in the transportation industry away from using fossil fuel sources, towards zero emissions sources such as electrical cars or hydrogen cars. For me, it is exciting to be able to play a part in this transformation.”

How does it feel to be at the forefront of developing North America’s first hydrogen-powered line-haul freight locomotive?

“I consider myself extremely fortunate to be able to work with such a talented team of railroaders and be a member of the CP family. I look forward to the day I will be able to tell my children and grandchildren about this opportunity – how a team of six railroaders took a leap of faith in building and developing North America's first hydrogen-powered freight locomotive and the role I played in this technological leap forward.”

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Matthew Findlay
Director, Locomotive Regulatory and Finance

As Director, Locomotive Regulatory and Finance, Matthew Findlay is responsible for supporting regulation development, mechanical systems and maintenance practices of CP’s Hydrogen Locomotive Project.

As a valued member of the team, Matthew is excited about integrating multiple technologies to achieve a safe and reliable zero-emissions line-haul freight locomotive — the first of its kind in North America.

What does sustainability mean to you?

“I have four children, so I’m very conscious about what the future environment is going to look like. In my mind, sustainability is about establishing clean technologies and processes and having a mindset that it’s not right to borrow from the future to fund growth and prosperity today.”

How does it feel to be at the forefront of developing North America’s first hydrogen-powered line-haul freight locomotive?

“It’s exciting to be part of a company that has the vision to invest in a technological leap forward in how we provide service to our customers in the most sustainable way possible.”

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Cody Fischer
Systems Engineer, Railway Technology

As Systems Engineer, Railway Technology, Cody Fischer is responsible for the systems engineering, design, architecture and analytics for much of CP’s railway technology. In addition, Cody is currently supporting the electrical engineering and control system design of the hydrogen-powered locomotive.

Cody has a degree in electrical engineering from the University of Calgary and is thrilled to be part of a team of railroaders that is pioneering groundbreaking technology in an industry that is ready for a paradigm change.

What does sustainability mean to you?

“The energy industry is changing. It is difficult to predict the future, but we know it must involve a sustainable energy source. The Hydrogen Locomotive Project is an opportunity to influence not only CP’s impact on the environment but also lead the industry down a path of new, innovative technology.”

How does it feel to be at the forefront of developing North America’s first hydrogen-powered line-haul freight locomotive?

“It’s very surreal, especially considering the amount of ground we covered in the development of the hydrogen-powered locomotive in such a short period of time.”

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CP Scores an A- on 2020 CDP Climate Change Disclosure Reporting

CP is proud to announce that it received a leadership level score of A- from CDP for its 2020 climate change disclosure. This accomplishment represents a significant milestone in CP's journey to integrate climate-related risks and opportunities into the company’s sustainability programs and reporting practices.

“We are proud to be recognized by CDP as a leader in taking action to confront climate change,” said Keith Creel, CP’s President and Chief Executive Officer. “A leadership level score of A- from CDP is a reflection of our efforts to position CP for a sustainably-driven future by implementing climate action within our own operations, while engaging with our value chain to enable positive change beyond our organization.” 

Key highlights from CP’s 2020 CDP submission include:

  • CP released its first public statement on climate change, demonstrating its commitment to take action and meet the challenge of climate change. The statement supports the goals of the Paris Agreement and the Pan-Canadian Framework on Clean Growth and Climate Change, which seek to limit global temperature rise to well below 2°C above pre-industrial levels.
  • CP committed to establishing a science-based emissions reduction target to guide its climate action.
  • CP released its 2019 Sustainability Data Supplement, which included for the first time the company’s full Scope 3 greenhouse gas (GHG) emissions, an important step to understanding the broader impacts of CP's business.
  • CP conducted a comprehensive scenario analysis in 2020 to understand the full range of possible climate change impacts to our business and align with the recommendations of the Task Force on Climate-related Financial Disclosure (TCFD).

CDP is an internationally recognized non-profit organization that runs a global environmental disclosure platform assessing companies on their climate-related performance and transparency. CP has been a contributing participant to CDP for over a decade, consistently disclosing annual emissions progress made on practices to improve the management of greenhouse gas emissions and ongoing energy efficiency initiatives.

CP will continue to build on its ambitious vision for sustainability in 2021. Initiatives will include formalizing the integration of climate-related risks into the enterprise risk-management process, developing CP’s strategy for mitigating risk, pursuing opportunities and increasing CP’s operational resilience under various climate change scenarios. Recognizing the global nature of the fight against climate change, CP aims to align with recognized initiatives that bring governments, sectors and supply chains together to support the goals laid out in the Paris Agreement.

For more information, see:

Read more in Energy Efficiency & Emissions.

CP Releases Climate Strategy and Ambitious Emissions Reduction Targets

CP published its first comprehensive Climate Strategy in July 2021, charting a path to reduce greenhouse gas emissions, adapt CP operations to the physical risks of climate change and further position CP as a leader in the transportation sector’s transition to a low-carbon future.

“CP’s Climate Strategy is ambitious, which we feel appropriately reflects the urgency of the fight against climate change. We look forward to collaborating with government, industry and research partners to create and test the new solutions required to achieve our targets,” said Keith Creel, CP President and Chief Executive Officer. “CP has been in business for 140 years and this collective commitment to sustainability and willingness to integrate new approaches will ensure we have a future as bright as our past.”

Building on CP’s Climate Change Commitment announced last year, CP’s Climate Strategy outlines the company’s approach to drive innovative climate action and a measured response to emerging climate-related risks impacting the rail sector. The Climate Strategy outlines CP’s objectives across five strategic pillars:

  • Establishing a clear understanding of climate-related risk and opportunities
  • Reducing the company’s carbon footprint
  • Adapting operations to the physical risks of climate change
  • Integrating climate factors across the business
  • Engaging with stakeholders on climate action

To guide implementation of the Climate Strategy, CP has established two science-based emissions reduction targets that address 100 percent of CP’s Scope 1 and Scope 2 emissions, and more than half of Scope 3 emissions.

  • CP commits to reducing Scope 1, 2 and 3 GHG emissions intensity of its locomotives by in excess of 38 percent by 2030. Locomotive operations represent CP’s largest source of emissions.
  • To support decarbonization across all operations, CP also commits to reducing absolute Scope 1 and Scope 2 GHG emissions from non-locomotive operations by in excess of 27 percent by 2030.

These targets are based on the most current methodology available to the transportation sector through the Science-Based Targets initiative (SBTi) with CP’s locomotive target recently approved by SBTi.

CP’s Climate Strategy, and supporting science-based emissions reduction targets, have been developed in alignment with the goals of the Paris Agreement and the Pan-Canadian Framework on Clean Growth and Climate Change, which seek to limit global temperature increases to well below 2°C. Through this Climate Strategy, CP is taking an industry-leading approach to climate change that addresses impacts to the company, stakeholders and the environment.

CP has already taken significant steps to reduce GHG emissions, including installing a large solar farm at its Calgary corporate campus capable of generating more power than consumed annually by the main headquarters building. CP has also initiated a pioneering hydrogen locomotive program, and is currently building a hydrogen-powered locomotive using fuel cells and batteries to power the locomotives’ electric traction motors. This initiative is important to generate critical industry knowledge and experience that will inform future development while supporting CP’s emissions reduction targets.

As part of CP’s overall Sustainably Driven strategy, the company participates in leading sustainability disclosure frameworks including CDP, Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD). Aligned with these frameworks, CP will continue to disclose annual emissions, management practices and ongoing energy efficiency initiatives, and commencing in 2022 will report to its shareholders on its progress on the Climate Strategy.

Breathing New Life into Old Locomotives

Between 1998 and 1999, CP built a series of EMD SD90 locomotives at the Calgary Ogden Shops (the site of our current corporate headquarters). Due to changing market conditions, a number of these units were removed from service between 2007 and 2009 and placed in storage in our Winnipeg yard. Growing demand for CP freight services in 2018 required CP to pull these units from retirement and re-equip them for regular line haul service. Rather than scrapping these locomotives, CP began retrofitting them in 2019 into powerful and efficient heavy-haul locomotive platforms supported by highly reliable upgraded engines (EMD SD70 models). The updated engine systems will comply with EPA Tier 1+ locomotive emissions standards, and significantly improve the fuel efficiency of the locomotives, resulting in substantially less air emissions.

Read more in Energy Efficiency and Emissions.

Locomotive Upgrades

Over 94 percent of CP’s annual Scope 1 and 2 GHG emissions result from the combustion of diesel fuel by our locomotive fleet. Subsequently, our emissions reduction strategy focuses on improving the fuel efficiency of our locomotives, while also exploring and testing alternative fuels. In 2018, we continued making enhancements to our fuel trip optimizer (FTO) and locomotive modernization programs.

FUEL TRIP OPTIMIZER

FTO is a technology used by CP’s train crews with the goal of planning and executing the most optimal trip for a particular train. This technology enables CP to create trip-specific plans that conserve fuel and energy within the train itself. In many ways, FTO is a sophisticated locomotive cruise control optimized for fuel economy, taking into account factors such as train length, weight and track grade to determine the optimal speed profile for a given portion of track. First implemented in 2009, FTO has been a significant contributor towards improving locomotive fuel efficiency at CP. 

In 2019, we are enhancing FTO systems to include pacing technology to drive deeper fuel efficiency and system fluidity improvements. Pacing technology accounts for a specific train’s location in relation to others operating within the same area of the network. The system detects opportunities to reduce train speed at certain areas to minimize wait times at stations, and then continue at optimum speed to deliver on time, in the most energy- and fuel-efficient manner possible.

As of December 2018, CP had installed FTO technology on 391 of our high-powered line haul locomotives. Our goal is to apply this technology to 85 percent of this part of our road fleet (approximately 600 locomotives) by 2025.

LOCOMOTIVE MODERNIZATION

We are currently in the midst of a multi-year line haul locomotive fleet renewal known as the Locomotive Modernization program. Starting in 2017, and continuing through 2024, CP plans to significantly upgrade and retrofit up to 321 six-axle, high-horsepower locomotives. Older locomotives will receive technology upgrades, new operating cabins, advanced diesel engines, enhanced cooling and improved traction systems. All upgraded units will be equipped with FTO and distributed power systems, both of which are EPA-certified fuel and emissions reduction technologies.

By the end of 2019, these improvements will be reflected in 25 percent of our active line haul fleet, having a direct and positive impact on CP’s fuel efficiency and corresponding GHG and air pollutant emissions. Upgrades are expected to improve fuel economy by a minimum of 2.7 percent. In 2018, CP upgraded 80 locomotives through this process, extending the useful life of this equipment by 20 years.

Our performance outlined in the graphics to the right illustrates our steadfast efforts to achieve maximum diesel fuel efficiency.

Fuel Trip Optimizer

Our train crews use Fuel Trip Optimizer technology to create trip-specific plans to conserve locomotive fuel.

CP Locomotive Fuel Efficiency (U.S. Gallons/1,000 GTM3)4

CP's locomotive fuel efficiency has improved 43% in the past 28 years

CP Locomotive GHG Emissions Intensity (kg CO2e/1,000 GTM3)

Target
12
10
8
6
4
2
0

11.2

 

11.2

 

11.0

 

11.0

 

10.7

 

10.7

 
201420152016201720182019

3 Gross ton-mile (GTM) is the movement of one ton of train weight per mile. GTMs are calculated by multiplying total train weight by the distance the train moved. Total train weight comprises the weight of the freight cars, their contents and any inactive locomotives.
Certain statistical highlights and safety indicators figures have been updated to reflect new information or have been revised to conform with current presentation.

43

%

CP has improved locomotive fuel efficiency by 43% since 1990.

ALTERNATIVE FUELS

Driven by a quest to lower emissions and improve fuel efficiency, our cross-functional Fuel Conservation team continues to explore different types of diesel fuels and alternative energy sources. During the past decade, CP has conducted technology trials on a range of fuel sources, including diesel fuels with varying sulphur profiles and other emissions-reducing qualities, plant-based diesel (biodiesel), liquefied natural gas systems, compressed natural gas, hybrid fuel cell and battery-hybrid technologies. Our Fuel Procurement group engages with fuel suppliers, equipment manufacturers, industry associations and regulatory agencies to explore advancements in the use of and applicability of alternative and next-generation fuels in the rail sector. We look forward to sharing the results of this ongoing work in future sustainability reports.

Facilities Upgrades

Although 94 percent of our Scope 1 and 2 carbon emissions come from the operation of our locomotives, we still strive to reduce our energy footprint and lower operating expenses in other parts of our business. During the past several years, CP’s Real Estate and Facilities team has implemented a number of energy-saving initiatives, such as switching from older steam heating systems to high-efficiency HVAC systems in several of our

larger yards, replacing aging lamps with LED lighting systems, decommissioning unneeded facilities and including high-efficiency mechanical and lighting systems in all-new construction and facility retrofits. We have recently completed significant work to optimize our yard air compressor systems and reduce energy waste through detecting and fixing leaks, and upgrading air piping infrastructure and heat recovery systems.

 

978

CP upgraded 978 lighting
fixtures with LEDs in 2019

3.4M

+

Resulting in estimated
annual savings of
3,428,822 kWh

687.6

Reduction of 687.6 metric tons
of CO2e annually

Our Performance

We track and report on our Sustainability performance annually. View our Energy Efficiency and Emissions data here.


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