Need for speed trumping UK emissions efforts

Need for speed trumping UK emissions efforts

More than 1.5 billion tons of goods were transported within the UK in 2016, with more than three-quarters traveling by road. It is a source of carbon emissions that the industry wants government support to tackle. Photo credit: Lambert Brothers.

The demand for faster delivery in the United Kingdom is colliding with a need to reduce supply chain emissions and ease growing road traffic congestion, according to a new report by the UK National Infrastructure Commission (NIC).

The year-long study, commissioned by the UK government, noted that incorporating the transport of freight into infrastructure planning would be crucial if the UK was to meet a target of decarbonizing its supply chain by 2050.

The highly competitive marketplace and tight profit margins already provide incentives for the freight industry to drive out excess cost from operations, and the NIC report found that the government incentives to reduce environmental impacts were limited. The commission concluded that if left to industry alone, these would not be prioritized or fully addressed.

“The commission’s central finding is that without action, freight’s contribution towards congestion and carbon emissions will remain problematic,” the NIC report stated. “Acceleration of technological advancements and clear, firm, long-term targets will be key to tackling this. A more coordinated approach within and between different tiers of government, based on better data, will be crucial to getting this right.”

A framework for delivery

More than 1.5 billion tons of goods were transported within the UK in 2016, with more than three-quarters traveling by road. However, road freight generates a disproportionate percentage of both carbon emissions and traffic.

Heavy trucks constituted 5 percent of the total vehicle mileage in Great Britain in 2014, but they contributed 16 percent of the UK’s greenhouse gas emissions (GHG) from transport. Smaller vans have been the fastest growing source of road transport demand in the UK, representing 15 percent of total vehicle miles while accounting for 16 percent of transport GHG emissions. The report also found that during morning rush hour, cargo traffic comprised more than a third of all vehicles entering London’s congestion charge zone.

Interestingly, the NIC also confirmed the high cost of last-mile delivery that it said was the most labor intensive and least efficient part of the supply chain. The report found that urban distribution only accounted for about 6 percent of total freight kilometers in 2016, but it represented 30 percent of overall logistics costs and contributed the highest levels of carbon dioxide (CO2) per freight ton moved.

The NIC said in its report that the freight system is at a crossroads with major technological change rapidly changing the costs and the byproducts of freight, driven by significant advances towards clean fuels, data availability, automation, and artificial intelligence.

As such, the report recommended that the UK government publish a comprehensive strategy for reaching zero emissions by 2050, specifically detailing investments and/or subsidies that government would provide.

The commission also noted that rail freight is inherently more energy efficient and emits a quarter of the CO2 per metric ton kilometer compared with road freight. Even so, the view that government support was needed in the decarbonization of rail freight was welcomed by the UK trade association for the industry, Rail Freight Group (RFG). 

“With battery and hydrogen technologies in their infancy on the rail network, and the extent of electrification still limited, the industry cannot be expected to deliver the necessary investment without the backing of government,” said Maggie Simpson, director general of the RFG. “This recommendation gives a way forward to provide the certainty that the rail freight sector needs, and a framework to oversee delivery.”

Subsidizing costs

Christopher Snelling, head of UK policy at the Freight Transport Association, said the changes recommended by the NIC report could be transformative for decarbonizing logistics in the UK, given that assistance was provided to help operators switch from carbon-based fuels.

“Change is already taking place within the logistics sector to adopt new forms of fuels and vehicles, but in order to implement such swift and radical change, government support for alternatively fuelled vehicles, as well as the necessary infrastructure to service them, is vital,” Snelling said. “Operators cannot magic new vehicles out of thin air, and there are attendant costs involved in switching.

“What is clear is that Britain needs our sector to deliver 4.1 million tons of goods every day of the year to every corner of the country, from central London to the Highlands of Scotland in a wide range of vehicles appropriate to the job,” he added. “There must be support for our industry if changes are to be made.”

The NIC report pointed out that technology and innovation was developing more slowly for heavy trucks than for lighter vehicles, creating a great deal of uncertainty over which technology would prevail in the coming years and, in turn, limiting investment in cleaning up road freight. A major source of that uncertainty is government regulation, NIC said, citing examples such as the creation of clean air zones in cities such as Birmingham, Derby, Leeds, Nottingham, and Southampton.

“The lack of clarity on standards and the speed that the freight industry would be required to change — in some cases there will be less than two years between the announcement of the Clean Air Zone standards and implementation of the Zone — has created uncertainty over what solution the industry could adopt,” the NIC noted.  “With no retrofit technology available to upgrade older vehicles to EURO VI standards, hauliers have the choice of buying new vehicles, paying a daily charge to enter the zones, or transferring goods to smaller vehicles which may be exempt from the schemes. With new compliant lorry tractor units generally costing more than their equivalent EURO V counterparts, and a 4 percent profit margin reported by the top 100 haulage firms, selling vehicles and being able to afford a new one may not be a viable option for many.”

Contact Greg Knowler at greg.knowler@ihsmarkit.com and follow him on Twitter: @greg_knowler.