In this special guest post, Chris Rowland, Director at MDS Transmodal (MDST), outlines some of the key findings of MDST’s recent report for pteg, ‘Freight in the City Regions’. You can read the report, and find out more about freight in the city regions on our Freight Hub.
The need for “sustainable distribution” in the City Regions
The freight and logistics industry is an essential feature of any economy as it allows manufacturers to receive their raw materials and components and to distribute their products to customers, while it also ensures that a wide range of goods are available in the shops. The industry is also a major employer, accounting for 9% of the country’s GDP and 7% of its total employment. At the same time, however, freight transport movements are a source of greenhouse gas emissions, contribute to congestion and generate noise; at a local level the diesel engines that power most road freight vehicles emit particulates that are damaging to human health.
For these reasons, local authorities and PTEs in the English City Regions have a growing interest in freight and are generally focusing on the policy objective of “sustainable distribution”, where a balance is found between economic efficiency and environmental sustainability. The needs and expectations of the freight industry and its customers (which are mainly commercial and economic) have to be balanced with those of City Regions’ residents and visitors through public sector intervention in the market. In economic terms, where the costs of private activities are not fully reflected in the user costs of the freight industry and their customers, there is market failure; the public sector therefore has a role in seeking to balance the needs of the private operators with the wider needs of society.
Through work it carried out for pteg in 2012-13, MDS Transmodal has produced a policy vision for freight and logistics in the English City Regions, along with a “policy toolkit” of practical measures that could be adopted by individual City Regions to move towards achieving this vision. Any initiatives by the City Regions would be addressing a relatively blank canvas. Central Government has made few positive initiatives in the freight sector, having generally been encouraged by the freight industry to leave matters to the market.
Policy vision for freight in the City Regions: the “last mile”
So what, realistically, should the City Regions be seeking to achieve by (say) 2030?
In the context of freight transport and its environmental impacts, the European Environment Agency talks about the need to “shift”, “avoid” and “improve” freight transport and this can be applied to urban freight transport and logistics.
For economic and very practical operational reasons it is difficult for “last mile” deliveries between Regional Distribution Centres (RDCs) and city centre retail outlets to shift from road to non-road modes of transport, so the emphasis is likely to be on “avoiding” and “improving” freight transport in urban areas. The vision for “last mile” deliveries in the City Regions that we have proposed in a report for pteg focused on:
- Consolidation of orders by receivers of goods and consolidation of road deliveries by freight transport operators, thereby reducing the number of freight movements required (“avoiding” freight transport);
- Use of low emission vehicles for last mile deliveries and collections in urban areas (“improving”);
- E-commerce deliveries to local collection and drop-off points (“improving” and “avoiding”);
- Quiet night-time deliveries (“improving” and “avoiding”).
Policy vision for freight in the City Regions: the wider picture
However, “last mile” deliveries to city centres should also be seen as part of longer distance distribution chains that link goods passing through RDCs with National Distribution Centres and ports and our vision therefore includes the development of a network of “Urban Distribution Centres” (UDCs) in the City Regions that provide the opportunity to transfer medium- to long-distance flows transported by rail and waterborne transport to low emission vehicles for the “last mile” deliveries into city centres.
To secure the maximum potential for the use of sustainable distribution services over medium to long distances, these UDCs need to co-locate intermodal terminals with RDCs (i.e. warehouses) and they need to be located within the range of low emission vehicles for city centre deliveries. These UDCs would be similar to Strategic Rail Freight Interchanges, but would often need to be closer to major urban areas, could also be located on major freight waterways (such as the Thames and the Manchester Ship Canal) and would need to have facilities specifically for low emission vehicles and to facilitate the consolidation of loads.
City Region “freight policy toolkit”
Given that the freight and logistics industry is owned and controlled by the private sector, how can the City Regions achieve this vision?
One thing is clear. This vision can only be achieved by the private sector freight and logistics industry operating in an environment that allows it to behave in a “virtuous” way so that more sustainable distribution can be secured, while also allowing it to compete on a level playing field, invest for the future and generate employment.
The City Regions need to develop integrated and evidence-based freight strategies within the existing Local Transport Plan (LTP) and land use planning framework and in consultation with relevant stakeholders through Freight Quality Partnerships (FQPs), with tailored packages of policy measures that influence the behaviour of the freight industry to adopt sustainable distribution practices.
A non-harmonised, inconsistent regulatory regime that is not based on evidence of impacts and without consulting the freight and logistics industry could actually do more harm than good to both the local economy and environment, as well as unnecessarily disrupting freight transport and logistics activities. While the freight and logistics industry is concerned about ill-informed and uncoordinated public sector intervention, it is equally clear that the industry adapts rapidly and efficiently to new opportunities dictated by different land use policies or the re-emergence of the rail freight sector. In other European countries, road pricing for freight has been absorbed by the industry despite initial objections. It follows that there is an opportunity for the English City Regions to redefine realistic objectives for the movement of freight that address both sustainability and efficiency.
While road pricing for freight would make a considerable contribution to achieving more sustainable distribution, this is a policy that would need to be pursued by government at a national level. At a City Region level, the key instruments for PTEs and local authorities to achieve the objective of sustainable distribution are likely to be:
- Defining suitable locations for new Urban Distribution Centres (UDCs) in and around the City Regions.
- Providing indirect subsidies to favour certain vehicle types and delivery timings on the basis of nationally determined principles. These might include exemptions for low emission vehicles from time windows in city centres, allowing LEVs to use priority lanes and make quiet night-time deliveries.
- Requiring major city centre developments to adopt Delivery Service Plans and promoting their use by other businesses based in city centre offices.
- Requiring major city centre developments to plan for off-street loading and unloading bays and planning for a network of on-street bays (possibly provided on a user pays basis).
- Working with Network Rail and other stakeholders to define future rail infrastructure requirements for freight in the City Regions (e.g. re-opening of freight lines and connections for UDCs).
- Developing a network of pick up and drop off points for e-commerce parcels that are integrated with City Region public transport networks.
- Working with major ‘industrial’ stakeholders such as ports and manufacturers to develop shared visions in those sectors (e.g. port centric distribution and UDCs) where the City Regions can play a supporting role in economic regeneration through freight and logistics activity.
- Providing information on regulations and routing for freight through signing, freight maps, information portals and, in the medium to long term, Intelligent Transport Systems (ITS).
The absence of nationally defined strategies for freight transport provides the opportunity for the City Regions to establish their own, using an evidenced-based and consultative approach that is already available via the LTP processes and working with existing FQPs.
Director – MDS Transmodal