An (in)convenient truth?

Friday, December 07, 2007

President of the European Intermodal Association Livio Ambrogio explains why intermodal transport is the key to sustainable logistics.

Though progressive managers have been promoting the notion of sustainability ever since the European Intermodal Association (EIA) was founded in 1993, it is only now that this concept is finally being integrated on a global scale. Though the EIA does not claim to be a club for 'greens' – the wellbeing of our industry is our foremost concern – the link between uncontrolled industrial and consumer behaviour and the costly consequences for our climate and our dwindling resources must now be acknowledged. Infrastructure, transport and logistics are some of the important weapons the authorities can marshal to achieve their binding Kyoto targets. Transport modes will be compared for their external costs (energy scarceness, pollution, land-take, etc.). We all, including the transport sector, must face this 'inconvenient truth'.

As a result, there is an urgent need to develop sustainable mobility solutions, not just because of climate change but also to safeguard our industry, jobs and prosperity. The transport sector will face increasing pressure from the public and the political authorities to do its share to lessen the greenhouse effect. It is the only sector where greenhouse emissions have risen over the last decade, a factor that, if widely known, will make it vulnerable to attack. The intermodal sector has much to offer in this respect and far-sighted transport companies should understand that opting for intermodal transport solutions is a way of securing their own future. Climate change is not so much a threat to the intermodal industry but a fast growing challenge (growing congestion, scarce energy resources, restriction of greenhouse gas emissions, spatial planning restrictions, citizens demanding high quality of life and environment) to the transport and logistics industry in general.

Companies will, sooner than they might like, be held responsible for the green audit of their whole product life-cycle. It is therefore unavoidable that current logistics processes will undergo substantial modification. Policy-makers, industry and researchers will have to address new challenges while any European competitive solution may well lie in innovative 'sustainable' intermodal transport solutions.

European Member States need to be able to secure their future transport flows, increasingly depending on scarce energy supplies, while simultaneously striving to reduce CO2 emissions by 2050 through energy-efficiency, transport demand control and renewable fuels. Sweden, for example, is hoping, through an energy strategy based on the use of bio-diesel, to be able to cease importing oil from 2020. Transport policy is also energy policy. The European Member States will be looking to systems of taxation that foster energy-efficiency, and will be pushing intelligent speed adaptations and considering forcibly curbing maximum truck speeds. Not only will this approach protect the environment but it will also improve the use of existing capacity, quality of service, safety and security. It has been demonstrated that intelligent speed adaptations, for example, are not only beneficial for the environment, but also result in astonishing time and fuel savings for citizens and businesses.

The European Council's conclusions of 9th March 2007 on a European Energy Strategy for Transport placed great emphasis on new technology and efficiency gains while proposing strategic priorities for:
• 'Improving the energy-efficiency of all transport modes';
• 'Designing instruments to promote energy and climate change conscious transport user behaviour';
• 'Promoting integrated transport systems and planning to minimise the use of energy for transport'.

In the recently launched 'Logistic Action Plan' of the EU Commission, Transport Commissioner J Barrot stated: "Europe needs efficient, integrated transport alternatives that are both environment-friendly and user-friendly." The action plan proposes a few dozen measures aimed at making freight transport in the EU more efficient and sustainable, while reducing costs and saving both time and energy.

In the absence of an unbiased policy of internalisation of external costs, the accounting costs presented to transport and logistics market players are out of line with their resource costs. This leads to misallocation of resources and less than optimum product/service profiles across the transport modes. Sustainable transport chain footprints and Life Cycle Assessment tools will compare alternative chains on the basis of their sustainability, in order to obtain a mechanism for transport pricing or regulation that will guarantee that the most efficient and sustainable chain is systematically selected.

A sustainable transport policy automatically means a comprehensive all-mode transport and energy policy. A sustainable transport policy is always related to the broader policy of general sustainability. Accordingly, the shared effects of transport policy measures in other areas, ie. 'secondary benefits' and trade-offs, must be taken into consideration. Since any sustainability policy has the risk of being misguided for an environmental policy under a fashionable new title, it is important to continually highlight the importance of the socio-economic dimension, not forgetting to involve citizens and the business community in an early stage. The new credo must become 'creating' instead of 'compensating', meaning that companies should invest in innovations (jobs) in front of their own door, instead of trading with CO2 rights by 'planting trees' in third countries only. Furthermore, we need a thorough discussion on an EU level regarding the significance of the parameter time (speed versus punctuality), which often wrongly influences car ownership, mode and route choice, distribution planning and consequent effects on mobility, environment and businesses. Time (travel versus waiting) is the core value regarding travel behaviour; therefore we need a different understanding of time and planning approaches to improve transport models.

Green logistics will change policy-making, businesses and behavioural patterns; it will be the new driver for future innovation, job creation, CO2 reductions and energy conservation while creating a competitive advantage for the intermodal industry. Additionally, the new EU Marco Polo 'traffic avoidance measures' should encourage industry to enhance its production processes, decrease weights or volumes, cut distances, raise average loads per vehicle and/or lessen the number of vehicles.

Thinking green to get gold by pursuing CO2 reduction has the profitable knock-on effect of reducing fuel use, as well as making the logistics chain more efficient. A growing number of market players are designing new manufacturing systems and carbon footprint strategies that drive energy-efficiency and logistics Best Practices. New energy saving structures, less maintenance, and less mechanic but more electrical 'by wire' subsystems with improved life-cycle costs are being developed (eg. hybrid cars). Among the integrators, postal services, railway undertakings and retail industry, there are those who are progressive and have taken the lead in appointing managers answerable to the Board for 'green accounting' using their carbon footprint calculations for their own inventories and advertisings. Some of the industries have calculated that their CO2 inventory comes 50% from final delivery, 17% from initial collection, and 33% internal logistics to mail centres and distribution points. New formulas are being used to work out business savings by offsetting fuel consumption and pollution per delivery.

The sustainable issue has become a profitable 'convenient truth' at least for progressive intermodal players. Since its foundation 15 years ago, the EIA has been promoting and developing sustainable transport solutions. Our members have always been ahead of the mainstream. We are pleased to observe that recent climate change and energy discussions have finally opened the eyes of an increasing number of non-believers who are embracing the lost cornerstone: the intermodal (co-modal) alternative.

Climate change and sustainability represent a challenge for us all. While traditional transport is part of the problem, intermodal solutions represent the way ahead.