(Credit: Union Pacific)Union Pacific Corporation has issued a $600 million green bond offering to fund investments that will decarbonize locomotives and achieve set emissions reduction targets. The bond transaction was finalized Friday, Sept. 9.
The emissions reduction targets of the bonds highlight Union Pacific's commitment to reduce absolute Scope 1 and 2 GHG emissions and Scope 3 GHG emissions from locomotive operations 26% by 2030 from a 2018 baseline, and net zero by 2050.
Currently, railroads are already one of the most fuel-efficient means of transportation. Moving freight by rail instead of truck reduces GHG emissions by up to 75%. On average, Union Pacific moves a ton of freight 463 miles on a single gallon of diesel fuel.
As outlined in the company's Green Financing Framework, expenditures to be funded with proceeds from the green bond offerings may include, but are not limited to:
Earlier this year, Union Pacific purchased 10 FLXdrive battery-electric locomotives from rail car manufacturer Wabtec. The order, which marks the largest investment in battery technology by a North American railroad, was expected to upgrade Union Pacific’s rail yard infrastructure and support its Climate Action Plan to significantly reduce greenhouse gas emissions.
Other railways making sustainable changes include Sierra Northern Railway (SERA), who just last week unveiled the new look for its industry-leading Hydrogen Powered Switching Locomotive. This zero emission switching locomotive is moving forward and is slated to be completed on schedule. The California Energy Commission awarded $4 million for the design, integration, and demonstration of a hydrogen fuel cell switching locomotive. The locomotive will prove the potential of hydrogen fuel-cell technology to reduce transportation air pollutant and greenhouse gas (GHG) emissions.
