Sustainability and Supply Chains: The

project Dr Tony Whiteing ITS, University of Leeds

Green Logistics •

• • •

A four year research programme into the sustainability of logistics systems and supply chains A consortium of 6 UK universities, led by Leeds Funded by EPSRC for 4 years Supported and steered by a range of organisations including the Department for Transport and Transport for London

Green Logistics: The Research Partners University of Leeds, Institute for Transport Studies Cardiff University, Logistics & Operations Management supported by Computer Science Heriot-Watt University, Logistics Research Centre

Lancaster University, Management Science University of Southampton, Transportation Research Group University of Westminster, Transport Studies Group

Key Objectives •

To identify and prioritise Green Logistics measures in terms of potential environmental and economic impacts

•

To establish baseline trends against which the success of Green Logistics initiatives can be monitored

•

To review the range of methodologies currently used and enhance the toolkit available for Green Logistics research

•

To integrate previously uncoordinated initiatives and techniques

•

To develop new analytical approaches of practical benefit to managers and policy makers

•

To engage with industry and policy makers in joint Green Logistics initiatives

Focus on Freight Transport Operations • As a significant generator of negative externalities and an increasingly important source of CO2 • With large potential for economic and environmental savings • Important changes in long term freight trends have been observed in recent years • We need to explore trade-offs between transport and other logistical activities at different spatial scales

Trends in GB Road Freight 1996-2006 Tonne-km (Billion)

Tonnes (Million)

Average Length of Haul (km)

1996

153.9

1730

89

1997

157.4

1740

90

1998

160.3

1727

93

1999

157.7

1664

95

2000

159.4

1693

94

2001

158.5

1682

94

2002

159.4

1734

92

2003

161.7

1753

92

2004

162.5

1863

87

2005

163.4

1868

87

2006

166.9

1936

86

Transport Statistics Great Britain, 2007

Mode shares: Percentage of all freight tonne-kms

Road Rail Water Pipeline

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

65

67

65

64

62

64

62

64

64

64

6

7

7

7

7

8

7

7

8

8

23

21

23

24

26

24

26

24

23

24

5

5

5

5

4

5

4

4

4

4

Transport Statistics Great Britain, 2007

Green Logistics is NOT : • Anti the lorry • ‘Tax to the hilt to force change’ • ‘Put it all on the railways or the canals’ • ‘Grow it all in your own back garden’ • Another ‘Food Miles’ project The project wants to engage with all stakeholder groups to evaluate all the options and to determine the best ways forward

Building on Best Practice • We recognise the huge improvements in performance of road freight and logistics operators in recent years • We recognise the great efforts of the government, vehicle manufacturers, operators, users and other stakeholders in achieving such improvements • We wish to build on the vast amount of ‘Best Practice’ found in the UK • But we do believe that significant problems still need to be addressed

Congestion and carbon – the key issues we face today • We need to reinforce the message that there is relatively little the road freight industry can do to reduce UK congestion. Congestion is (in large part) an economic problem • There is little that UK transport operators (or indeed the UK) alone can do directly to reduce the impact of carbon, because it is a global problem • These are not reasons to do nothing!

The Environmental Spectrum Better

Existing environmental performance

Worse Higher costs

Existing cost level

Lower costs

Understanding the ‘Key Ratios’ • The relationships between economic activity, freight transport activity and the consequent externalities are driven by a set of key ratios, which can be influenced by a range of technology changes and/or policy initiatives • The project aims to develop a full understanding of these ratios and how they can be influenced to benefit the environment

The 9 ‘Green Levers’ Value density Modal split Average handling factor along supply chain Average length of haul Average load per laden journey Empty running Fuel efficiency Emissions per litre of fuel Other external effects per km travelled

The 12 Work Modules (1-6) Led by

•

WM1

Review of the sustainability of freight transport in supply chains

Cardiff

•

WM2

Understanding and forecasting business-as-usual trends

Heriot-Watt

•

WM3

Data management and data collection techniques for sustainable logistics

Westminster

•

WM4

Enhanced econometric freight and commercial vehicle modelling techniques

•

WM5

Enhanced supply chain decision tools

Cardiff

•

WM6

Integrating vehicle routing and scheduling

Lancaster

Leeds

The 12 Work Modules (7-12) Led by

•

WM7

Scope for modal shift through fiscal, regulatory and organisational change

Westminster

•

WM8

E-commerce, E-Logistics and the Environment

Heriot-Watt

•

WM9

Achieving greater sustainability in urban distribution operations

Westminster

•

WM10

More sustainable approaches to reverse logistics and for the collection, recycling and disposal of waste products from urban centres

•

WM11

Integrating the tools of analysis and shaping the holistic evaluation framework

•

WM12

Establishment of a Virtual Centre for research on green logistics

Southampton

Leeds

Heriot-Watt

Understanding the uncertainties relating to freight transport costs • There are major uncertainties attached to the future magnitude of transport costs (operating costs, plus social and environmental costs) • These can be expected to impact on the use of freight transport within supply chains in many different ways • Uncertainty breeds contingency and hence inefficiency? Transport cost uncertainties

Fuel Uncertainties

Labour uncertainties

Congestion uncertainties

Policy impact uncertainties

E-commerce, E-Logistics and the Environment • There are very different views on whether Ecommerce (particularly E-retail) helps or harms the environment • The positive view : Home shopping reduces (car) shopping travel and deliveries can be efficiently consolidated • The negative view: Home deliveries are often inefficient, over long distances, put larger vehicles in suburban streets - and people will travel elsewhere in any case

Localisation of supply • Local products (especially food) offer increasingly attractive marketing opportunities • The more local chains can accommodate this (e.g. Booths – see ‘Wise Moves’ report) • Main national players find it harder: – Their networks of large RDCs reduce the transport benefits of local sourcing – Hard to reconcile local products with e-retail (need tailored offerings in different regions?)

How can the industry help (itself)? • Get involved in the research, development and technology. Provide data for research, engage in trials, collaborate more. Help to steer research and the agenda • Adopt (and publicise) more examples of good practice • Change the business mix, where possible – e.g. work with rail rather than against it, where possible

• Use environmentally responsible suppliers • Develop all staff into the right mindset and to embrace the appropriate systems and technology

www.greenlogistics.org [email protected]