Transport
Monday, 12 August 2013 10:38

Birdies and bogies: challenges in transport and logistics

While a global supply chain enables companies to leverage lower cost manufacturing, there are significant challenges imposed on logistics companies in terms of carbon emissions and finding cost-saving alternative solutions. 

Logistics companies are increasingly pressured to reduce CO2 emissions and pursue environmentally-friendly transportation initiatives, such as depending on trucks for cargo transport to energy-conserving mass transport with lower pollution, rail and ocean transport.

According to Hennie Heymans, managing director of DHL Express South Africa, businesses need to re- evaluate logistics costs in order to prevent the increased costs impacting end-consumers’ pockets.

Heymans says: “We have found that businesses have attempted to absorb this increased cost by improving driving habits, encouraging intelligent driving behaviour, considering alternative fuel options such as diesel or liquefied petroleum gas (LPG), making use of intelligent route mapping and planning, as well as cutting back on routes where warranted.

“A strategy for businesses to consider for reducing petrol-related costs could include planning smarter travel routes and shipments. Due to the high costs of transport, there is now a greater need for a sustainable supply chain.”

He says a global trend is to outsource logistics to external partners in order to reduce costs and simplify delivery structures. “A logistics partner ensures that transport routes are more efficient and shipments are streamlined as much as possible.

“Businesses in South Africa are under increasing pressure in the current economic climate to remain competitive, both locally and globally. Outsourcing logistics strategically can potentially make a significant positive difference to a business’s profitability, due to the reduced cost and the decrease in company resources.”

Human activity generates annual greenhouse gas emissions of approximately 50 000 megatons CO2.

A report by the World Economic Forum (WEF), Supply chain decarbonisation: The role of logistics and transport in reducing supply chain carbon emissions, states that significant emissions reductions could be achieved in the medium term by implementing change throughout the end-to-end supply chain. This could be primarily achieved through wider adoption of available technologies, leveraging new commercial relationships and developing new business strategies.

The report provides a contextual and an initial quantitative assessment of the supply chain decarbonisation challenge.

“The conditions required to enable these changes are being created. We see three developments providing the necessary business environment for implementation,” states the report.

 

The WEF highlights three fundamental drivers of change in this sector, namely:

• Regulation of carbon emissions.

• Response to higher and more volatile fuel prices.

• Evolving consumer and client demand.

 

The majority of large logistics and transport firms publish annual corporate social responsibility reports, detailing their path towards more sustainable operations.

Imperial Logistics reports that the logistics and transport industry accounts for about 5% of the global annual CO2 emissions. Marius Swanepoel, chief executive officer of Imperial Logistics, who also won the Sustainability Leadership Award in recognition of making African supply chains more environmentally-friendly in February 2013, notes: “One litre of diesel will pump 2,6kg of CO2 into the atmosphere, while a 400l fuel tank will churn out over 1 050kg of CO2. Even if global emissions are only 5%, there is still a desperate need to reduce emissions.”

The WEF identifies opportunities that display an end-to-end view of the supply chain in a vital step towards achieving the changed behaviours that may contribute to change.

According to a presentation by Global Railway Engineering, Radially aligning self-steering bogies – an indispensable key to green heavy haulage, there is global consensus at all levels recognising the desperate need for “green” technologies to reduce harmful emissions worldwide.

Leveraging local and international experience gained over 30 years by Global Railway Engineering and Transnet Freight Rail on Scheffel self-steering bogies, the paper examines various carbon-reducing opportunities with regard to operating expenditure and capital expenditure.

The role of freight

The presentation states that, according to projections by the International Energy Agency (IEA), trucking energy use by 2050 is projected to increase by 50%, with the quantity of freight moved by trucking worldwide expected to nearly double, and energy-efficiency to improve by 20%, should current efficiency trends continue. Rail freight volume is expected to increase by about 50% with a similar 20% improvement in rail efficiency. Much of these efficiency savings are anticipated to come from advances in efficiencies in existing technologies and clearly fall short of the required commitments.

A taxing issue

After the recent publication of the final Carbon Tax Policy Paper, South African businesses have become increasingly aware of finding economically efficient alternatives.

This has significantly pushed the need for new, rapidly adoptable technologies that will be able to offset this tax as rapidly as possible to ensure that heavy haul in these territories remain competitive in the global market.

Global Railway's presentation identifies the Scheffel self-steering bogie as one such solution, at least for rail freight. The unique “off-flange” steering allows the bogie to steer around curves in a near-pure-rolling state which greatly increases efficiency and reduces wear on rail and wheel.

Compare this to the conventional three-piece bogie, which has its axles held rigidly parallel and has to therefore be “forced-steered” around curves by the flange grinding against the rail with all wheels skidding on the rails.

The resultant difference between the wear rates of wheel and rail and the reduction in curving resistance, when comparing the two bogie types, is of quantum proportions. Global estimates that the adoption or retro-fitting of this technology to current rail freight can realise an operational saving typically of the order of 40% including up to 5% instant savings on fuel and a significant reduction in carbon emissions.

The US EPA  hangs most of its carbon reduction hopes for the freight sector on an intermodal shift from road to rail - a saving of approximately 11 million tonnes of CO2 per annum. According to Global, it is estimated that adopting or retrofitting their existing rail freight to Scheffel bogies will have a very similar impact on annual Carbon emission savings at a fraction of the cost and effort.

Despite many innovations in transportation technologies that are aimed towards reducing carbon tax on large companies, Global Railway Engineering suggests that while these innovations may deliver significant benefits in the long term, they may take too long to deliver on these benefits to be able to meet the GHG reduction targets. Global Railway encourages freight and transport companies to not wait on these technologies, but to investigate existing and rapidly adoptable technologies like the Scheffel bogie to not only assist in meeting the GHG reduction targets, but deliver tax savings and release carbon incentives for those brave enough to take the first steps.

Full thanks and acknowledgement are given to Hennie Heymans of DHL Express South Africa, L.L. Bradfield, R.D. Fröhling, Global Railway Engineering, Transnet Freight Rail: “Radially aligning Self-Steering Bogies – an indispensable key to green heavy haulage”, The World Economic Forum: “Supply Chain Decarbonisation: The role of logistics and transport in reducing supply chain carbon emissions”, and Imperial Logistics for the information given to write this article.

FOOTNOTE:   EPA Analysis of the Transportation Sector Greenhouse Gas and Oil Reduction Scenarios February 10, 2010