Cuts of 60% or more in volumes of freight deliveries are being predicted - along with badly-needed improvements in air quality - from a load consolidation scheme currently being introduced in the UK port city of Southampton. The forecasts are based on a systematic approach to monetising the impacts of urban freight movements on wider economic and societal issues, which the UK has pioneered.
Freight consolidation centres (FCCs) have been gradually expanding in a number of European countries, including Germany, the Netherlands and the UK. Set up outside, but close to, urban clusters of businesses and public institutions, with good access to major routes, they aim to take pressure off cities’ road networks.
In Southampton, destinations for major flows of deliveries include the city’s administrative HQ and regional medical complexes. One of these, University Hospital Southampton (UHS), currently receives 900 deliveries of all sizes each week and is progressing a substantial programme of rationalisation to reduce the number.
This began with the arrival, in 2014, of what local operator Meachers Global Logistics terms the ‘sustainable distribution centre’ (SDC) concept. Now in operation at much of the company’s 21,400m2 of space around the city, it uses dedicated coding systems for the identification of re-sorted consignments and their ultimate destinations.
New approach
A new approach to freight movements is proving to be highly relevant in Southampton which, in November 2016, adopted a tough clean air strategy aimed at reducing its prevailing roadside levels of nitrogen dioxide (NO2) to within statutory national limits. It is introducing a clean air zone (CAZ).
As currently planned, this will cover the whole of the central area of the city, including the UHS. A public consultation on the proposal closed in September, with results due to be published by the end of this year.
Non-compliant trucks could face penalty charges of up to £100 ($131) a time to enter the CAZ, a cost that would inevitably be passed on to freight operators’ customers. Avoiding this will involve ‘last-mile’ deliveries being made by fleets of smaller, lighter, potentially electric-powered vehicles operating from a consolidation centre.
The move to introduce a CAZ follows the 2015 publication, by the UK government’s Department of Environment, Food and Rural Affairs, of its UK Air Quality Plan. This identified Southampton as one of the country’s five most polluted cities. In a supporting move in April 2017, the UK
In response, the TSC has developed an economic assessment tool that estimates the cost and benefits of moving towards the model. Published in July, its report identifies three main issues:
• long-term financial viability – the use of a consolidation centre adding an additional link into the supply chain, with potential cost implications
• the need for accessible locations
• a requirement for convincing business cases
Consolidated deliveries
Its research had already shown that large public sector organisations such as hospitals could benefit particularly from consolidated deliveries. This is because they have a constant need for frequent, low-volume deliveries of drugs and medical supplies that could reach them on less polluting vehicles. Their schedules and movements would be rigorously planned and monitored using available freight management technology to ensure optimal use.
Analysis of the current situation at another regional medical complex, Southampton General Hospital, has used delivery and service plans of the kind developed by Transport for London to manage freight movements in the UK capital. The results have shown that the numbers of deliveries being made were running at a level some three times greater than had previously been realised, due to a lack of data.
Meachers’ commercial director Gary Whittle told ITS International that the new approach could reduce UHS’s current deliveries by 60% or more. He has used the TSC research to quantify the likely impact of the new CAZ, and attribute the benefits for his own operation.
“We welcome the data as it clearly demonstrates the benefits of consolidation,” he continues. “We have previously struggled to quantify the financial gains, and this gives us an independent tool which should focus the attention of any potential user.” He has the operational and vehicle management aspects of the necessary last-mile onward connections currently under evaluation.
The TSC believes that its research represents a first of its kind, in that monetising the impacts of urban freight on wider economics and societal issues “to our knowledge, has not been comprehensively addressed before”. It has used assessment and operational cost models available in the DfT’s WebTAG4 on-line transport appraisal guidance and toolkit, and combined these with its own calculations of the operational savings for the end users.
Accurate survey
To collect the data necessary to quantify these, the TSC had originally planned to use the output from automatic number plate recognition cameras that are already operating in the city to identify vehicles entering and exiting the UHS loading bay. Since, however, early sampling proved that the results would be insufficiently specific, it brought in UK camera provider Tracsis to carry out an independent and more accurate survey. This has enabled the generation of three important datasets:
• First, a reliable estimation of the numbers of trucks that would be likely to pay a penalty charge to enter the proposed CAZ
• Second, an analysis of the average delivery times being taken by trucks using the UHS bay
• Third, an informed understanding of the types of deliveries being made - and of the utilisation rates of the vehicles concerned
The resulting output, fed into the TSC’s own economic assessment model, has made it possible to quantify the expected operational cost savings that are shown in table 1. The organisation sees its ‘novel’ approach to measuring the impacts of urban logistics as opening the door for future research in the sector and testing for other logistics business models.
Among planned follow-ups is a round table meeting bringing together the DfT, TSC and the UK government’s Joint Air Quality Unit on the kind of support measures that will be needed for other cities that are being required to ensure compliance with NO2 limits.
