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National Infrastructure Commission’s call for evidence on its Freight Study ~ Response from Campaign for Better Transport.
 

February 2018

Campaign for Better Transport is a leading charity and environmental campaign group that promotessustainable transport policies. Our vision is a country where communities have affordable transport thatimproves quality of life and protects the environment.

Campaign for Better Transport is pleased to comment on the National Infrastructure Commission’s call for evidence on its Freight Study.

Summary

To meet the challenges of current and future freight provision, we submit evidence in support of the following points:

  • There is a need for cross-modal transport planning by Government
  • Corridor research, sponsored by DfT, shows investing in rail can reduce road congestion, pollution & collisions
  • More rail freight capacity and capability are needed to satisfy suppressed demand
  • There is a need to make road freight more efficient to reduce its adverse impacts
  • There are significant benefits in putting road and rail on comparable charging systems
  • Track charges for HGVs are not differentiated by weight or type of road
  • There is a need to reform the HGV and rail freight charging systems to remove the disparity between HGVs and rail freight 
  • There is a need to calculate and consider all the external cost of HGV use 
  • Distance based HGV charging could transform freight transport
  • We have evidence to dispel the myths about the benefits of ever larger heavier lorries
  • Strategic Rail Freight Terminals can facilitate big growth in rail freight volumes
  • Vans as a sector are lacking in regulation and consolidation
  • The safety costs of freight should be evaluated and considered


We would highlight the omission of the crucial topic of external costs and charging of freight not covered in the questions; of which safety, not mentioned, is a key element.The single most effective change to achieve all the Government’s stated objectives of improving efficiency, reducing exposure to collisions, and reducing air and CO2 pollution would be to replace the existing time-based lorry charging system with a distance-based system which could relate charges paid to the real impacts HGVs have on other road users and the road network.In addition, we draw your attention to our earlier response to the NIC Interim report, in particular our challenge to its unhelpful comments about rail freight. 1

1.What are the key constraints to the effective and efficient movement of freight in the UK and what can be done to overcome them?

There is a need for cross-modal transport planning by Government.

Proper cross modal transport planning by government is needed. A recent example of silo planning approach is the way the Highways Agency route strategies in advance of RIS1 did not even have the parallel rail routes included in the corridor studies for A14, A34, M6 despite the fact they carry large quantities of freight by rail.

Our Department for Transport (DfT) sponsored research of April 2017, Impact on congestion of transfer of freight from road to rail on key strategic corridors, confirms the point, that integrated rail and road planning is the best way to reduce road congestion, collisions and pollution. Furthermore, it shows that the use of averages can be misleading. In the case of certain strategic transport corridors, it is possible to improve road conditions without needing to add more road capacity. If long distance consumer freight and construction materials can be transferred to rail, the productivity and reliability of existing road services will improve without needing to add any extra lanes of motorway.

We are concerned that the NIC interim report, issued in October 2017, quoted DfT statistics which used average figures rather than corridor analysis: we advise that the NIC Freight Study must not rely on averages. Our research shows that using national averages in transport planning, as in the NIC interim report, instead of analysing individual corridors where there are parallel rail routes, can be misleading.

For example, the 33 freight trains in and out of Felixstowe already remove around 2,500 lorries per day off the congested A14 corridor. Rail freight could be increase by 50 or 60 per cent on both the A14 and A34 out of Southampton Port within the next five to seven years based on a combination of current funded CP5 Network Rail projects and the- as yet- unfunded proposals in the Network Rail Freight Network Study for the Control Period 6 until 2024.

The following DfT statement supports corridor analysis and recognises that integrated rail and road planning into a cross-modal approach is the best way to reduce road congestion, collisions, and pollution. DfT said: "We agree with the Campaign for Better Transport that rail freight offers real benefits for the environment and helps keep bulky loads off of the road network, helping to ease congestion for other motorists. We look forward to using these findings to help inform our coming road and rail strategies and are committed to working with the rail freight industry to support growth of the sector.”

Corridor research, sponsored by DfT, shows investing in rail can reduce road congestion, pollution & collisions

Research by MTRU that we commissioned shows that upgrading the existing rail lines which run parallel to key congested motorway routes would allow large numbers of lorry loads to be transferred to rail, easing congestion, improving air quality and reducing road collisions.
The research examined the socio-economic benefits of upgrading existing rail lines on four heavily congested routes: the A14 between Felixstowe and the Midlands, the A34 from Southampton to the Midlands, and the M6 and M62 motorways, which together carry around 37,500 of the large HGVs every day. Transferring 2000 HGVs, equivalent to up to 8000 cars, from each of these corridors every day to rail would significantly improve road conditions without needing to add extra road capacity and would reduce nitrogen oxide emissions by 10 per cent and particulates by 7 per cent per corridor.Furthermore, national carbon dioxide emissions could be reduced by 2.5 per cent and killed and seriously injured figures reduced by 18, nationally if these four corridors were upgraded. 2, 3

More rail freight capacity and capability are needed to satisfy suppressed demand.  There is considerable suppressed demand for more consumer and construction rail freight services on key corridors such as the A14, A34 and M6, so capacity upgrades could remove serious numbers of the large long-distance lorries from congested routes.

1.1 What do you see as the key drivers to a successful freight system that is fit for the future?
The charging regime needs to be changedso that rail and road are brought into line with each other; currently, HGVs are heavily subsidised so distorting the market. MTRU research published in January 2018 analyses the extent to which HGVs do not internalise their costs. 4
The research, using DfT values, shows that HGVs are only currently paying around 32 per cent of their external costs, which is not sustainable. Charges should reflect the costs of climate change, collisions, road infrastructure damage as well as the costs of congestion to the economy. These impacts are severe and are not reflected in the level or structure of current taxation of HGVs in terms of miles driven and therefore the congestion, infrastructure track costs, pollution, and safety impacts.
Until there is wider acknowledgement of the need for transparency of the external costs of freight delivery it will be difficult to control its adverse impacts. For example, if the full costs of next and same day deliveries were properly factored into product prices, this would affect demand.
Modal shift to rail would reduce road congestion and thus improve productivity and reduce pollution and collisions. See DfT Mode Shift Benefit table P6 and http://www.freightonrail.org.uk/PDF/MTRU_addendum_to_the_2014_research_issued_in_Jan_2018.docx

We need to make road freight more efficient to reduce its adverse impacts.
HGVs are competitive but not efficient. Government figures show that nationally 30 per cent of lorries are driving around completely empty, a figure which has been growing for some years. 5 DfT figures indicate that only 34 per cent of HGVs were constrained by volume, 13 per cent by weight and only 19 per cent limited by weight and volume in 2016 6 : this shows the potential to increase vehicle load factors by between 30-45 per cent with the right policies.
Given that the marginal external costs are far higher for road than rail, a new charging regime for HGVs provides an opportunity to move towards a user pays principle to level the playing field between the modes.

While road and rail compete intensely, the modes also work collaboratively.  We urge the NIC to recognise the strength of each mode and seek to leverage those strengths to maximise benefits and improve overall outcomes.

There are benefits in putting road and rail on comparable charging systems.
Introducing a distance-based road charge for HGVs would put road freight on a more similar footing to rail freight, which already pays a distance-based charge. 
The setting of charges for the movement of freight by rail is considered in a completely different way to the setting of charges paid by the movement of freight by road. An HGV distance-based levy creates the opportunity to introduce a more parallel process for setting and structuring charges.
Rail access charges are set every five years by the Office of Rail and Road (ORR). The basic charge is set based on detailed costing, calculated by Network Rail. In accordance with the Railways (Access, Management and Licensing of Railway Undertakings) Regulations 2016 the minimum charges must be set at the cost that is directly incurred as a result of operating the train service. In addition, mark-ups can be levied where it is deemed that the market can bear to pay them. The setting of rail access charge is done following a Periodic Review process, which is led by the ORR. This process lasts around 3 years and requires considerable engagement and input from rail freight operators. Charges once set are increased by retail prices index (RPI) every April.

As a result, rail freight operators face uncertainty on a five-year basis over what future charges will be, but road hauliers do not face this uncertainty.  Even without the changes implemented through the periodic review process rail access charges have increased by around 22% since fuel duty was frozen in 2011. The increases in charges paid by rail freight operators, but not by HGVs have had the impact of making it gradually harder for rail freight operators to compete with HGVs over this period. See graph below which shows changes to fuel duty levels and actual Retail Price Index increases applied to rail track access charges against a base of 1, since 2009.

Graph showing supporting figures

Combined Vehicles
There is currently a discount applied to Vehicle Excise Duty in respect of Combined Vehicles – i.e. those lorries that are used as part of a multi-modal journey. The discount applied is around £600 per annum, but this is not sufficient to have a great impact or incentive. An HGV levy could be further used to allow a discount for lorry moves within a certain radius (say 25 miles) that are undertaking the final legs of journeys, where the trunk haulage has been undertaken by rail or water.

Difference in the way track costs are calculated for the two modes.
Rail freight costs are calibrated to take into account all the parameters of the wagon and loco, in order for the specific charges to reflect the impact that the rolling stock has on the network.  (i.e. not just weight but vertical damage impact from bogies. Freight operators pay the cost directly incurred from running the train on the network.   This is set on the basis of short-run variable costs.  Variable Usage Charge is the largest component of direct charges.  It is designed to equal the operating, maintenance and renewal costs that vary with traffic.  The Vehicle Track Interaction Strategic Model (VTISM) models the variation in track damage between a range of different vehicle parameters, which drives a specific variable charge for each wagon and locomotive.

Furthermore, fixed costs are allocated for each commodity across the network based on the modelled costs of circa 3,100 individual track sections.  These are then allocated based on traffic across each section.  For the commodities assessed as being able to bear a mark-up additional charges are set to recover a contribution to the fixed costs of the network through a Freight Specific Charge.   
So, rail freight already has a distance-based charge based that varies depending on the axle weight and suspension type of vehicles, to reflect variable damage to the rail track, and to encourage behaviours such as fitting more track friendly suspension to wagon fleets.
There is a risk that the complexity of rail freight charges creates an uneven playing field between road and rail.   It would seem appropriate to take a similar approach to road and it is suggested that the appropriate categories suggested are vehicle weight, number of axles and Euro emission class.

Track charges for HGVs are not currently differentiated by weight or type of road.
The charging does not distinguish between different types and weights of HGVs within the 3,5 to 44 tonne weight range. The largest and heaviest HGVs, (mostly but not entirely articulated), cause a great deal more damage to foundations and structures of roads than cars. This is because the damaging power rises exponentially as weight increases. This is called the Generalized Fourth Power Law. The standard six-axle 44 tonne 16.5 metre truck is 138,000 times more damaging to road surfaces than a Ford Focus. Therefore, some of the heaviest road repair costs are therefore almost exclusively attributable to the heaviest vehicles. Motorways are constructed to a higher specification than local-authority-run roads to cater for heavy goods vehicles, but it is the latter which make up almost 98% of our network which explains the poor repair of many local authority-controlled roads.

There is a complex performance regime that rail freight operators must administer, of which there is no equivalent on the road network. The charging regime for road is in effect fuel duty, which is very simple and has been frozen since 2011 and there are no fixed costs of the UK road network allocated to different sectors of road users.  It is interesting to compare the work recently undertaken by the FTA on the costs caused by HGVs on the UK’s road network and the scrutiny of the equivalent in the rail sector, despite rail only moving about 12% of freight in the UK.

The RepGraph report for the FTA “Heavy Goods Vehicles: Do they pay their way? - impacts on road surfaces”, November 2017, muddles two different costing methods and comes to the wrong conclusions and thus the wrong figures. The RepGraph report helps to illustrate the need to understand the complexities of costs and revenues.  It sets out the total tax take from HGVs including fuel duty and compares it to the overall costs of road expenditure and road maintenance.  It also compares this to the Mode Shift Benefit values for infrastructure, but unfortunately it conflates two different and recognised costing methods (ie marginal external cost method and the fully allocated cost model) to come to grossly inaccurate conclusions. Thus the RepGraph approach has four fundamental flaws:

  • Inclusion of fuel duty (£4,093m) as though it is hypothecated income which can be counted against HGV infrastructure costs – there are no plans for this. The actual hypothecated figures from HGVs is £291 million form the DfT tax income plus £50m estimated from the RUL = £340m
  • Using an out of date DfT value for infrastructure of 9 pence per mile instead of the 2015 figure of 18 pence per mile
  • Complete omission of any marginal external costs other than infrastructure
  • Does not recognise that HGVs and in particular the large heavier ones are far more damaging to road infrastructure than cars. Because of their weight, the standard 16.5 metre 44 tonne HGV, which is the industry workhorse, is 136,000 times more damaging to road infrastructure than a Ford Focus.7

So, instead of the report’s claim that HGVs pay three times more in direct taxation than their estimated damage costs to infrastructure, HGVs are in fact only paying of their m reality HGVs are only paying  £0.34billion  (11 per cent) toward infrastructure costs against the FTA road cost estimate (corrected) of £3billion.

We recommend reform of the HGV and rail freight charging systems to remove the disparity between HGVs and rail freight 
Rail and road complement each other, and the two modes should be able to play to their strengths. For example, rail freight is well placed for long distance consumer and traditional bulk traffic. But at the moment there is huge market distortion which makes it very difficult for rail to compete because, as the latest figures show, HGVs are only paying around a third of the costs they impose on the economy, society, and the environment. 8

There is a need to calculate and consider all the external cost of HGV use 
For articulated HGVs, the DfT produces “Mode Shift Benefit” (MSB) tables, most recently updated in 2015 with estimates for 2020 values at 2015 prices.  These calculate the marginal costs so that investment in alternatives which reduce articulated vehicle miles can be tested for value for money.

These showed a rise in costs from the original 2009 estimates, those for road infrastructure and for carbon. 

DfT marginal external cost tables

The tables below show the comparative values.

 

Motorways
(by level of congestion)

Roads

 

 

High

Low

A

Other

Weighted Average 2015

Weighted Average 2009 report

Congestion

99

24

72

78

57

52.4

Accidents

0.5

0.5

5.6

5.5

2.7

2.8

Noise

9

7

8

14

8

7.0

Pollution

0

0

0.1

0.2

0.1

2.5

Greenhouse Gases

6

6

7

9

7

3.8

Infrastructure

7

7

24

171

18

9.0

Other (roads)9

6

6

6

6

6

6.4

Gross Total

127.5

50.5

122.7

283.7

98.8

83.9

Taxation

-31

-31

-32

-40

-32

-34.1

 

 

 

 

 

 

 

Marginal cost gap

96.5

19.5

90.7

243.7

66.8

49.8

Road Tax as per cent Gross marginal cost

24 per cent

61 per cent

26 per cent

14 per cent

32 per cent

41 per cent


Sources: Mode Shift Benefit Technical Report, DfT 2009, Mode Shift Benefit Refresh, DfT 2015

It is clear from the above that a very significant amount of the real marginal costs of the largest HGVs is not being met.  In 2016, 9 billion vehicle miles were run by articulated HGVs, implying a marginal cost shortfall of about £6billion.  Clearly these numbers vary a little from year to year according to traffic and the severity of impacts such as pollution or casualties.  However they remain substantial and completely unmet.  The issue of congestion costs is discussed fully in the original report, they must be included in the marginal cost model if economic efficiency is to be maximised.10

Any road charging system must apply to both UK and foreign vehicles to ensure that all pay for the costs that they are causing on the UK road network. This will have the benefit of increasing revenue paid to the UK government and ensuring that all actors in the road haulage market are on a level playing field. However foreign hauliers still frequently purchase their fuel before travelling to the UK and therefore don’t pay fuel duty in the UK.

Distance-based HGV charging could transform freight transport
The single most effective change to achieve all the Government’s stated objectives of improving efficiency, reducing exposure to collisions, and reducing air and CO2 pollution would be to replace the existing time-based lorry charging system with a distance-based system which could relate charges paid to the real impacts HGVs have on other road users and the road network. The current daily charge bears no direct relationship to the amount of use of the network therefore the system does not incentivise more efficient use of the road network or the time at which it is used, to reduce lorry miles. 
Furthermore, the revenues from the distance-based charging could be re-cycled into supporting the quality of logistics through training and technology which will help the viability and operations of SMEs, as seen in Germany.

Dispelling the myths about the benefits of ever larger heavier lorries

The road haulage industry has an insatiable appetite for ever bigger lorries which saves them money but increases the external costs for economy, environment, and society. The point therefore is that bigger trucks might be efficient for road hauliers but that is because they are not paying for their external costs. The proponents say that larger trucks will reduce lorry miles and thus pollution but fail to explain why existing HGVs do not get good load utilisation. 

The DfT latest domestic road freight statistics report and its statistics confirm this behaviour and states that, there has been a shift towards using larger HGVs with the tendency for the clear majority of HGVs to be purchased at the maximum size and weight permitted which optimises the position for the largest and heaviest loads but creates part loading for other consignments.
Therefore HGVs need to pay charges applicable to their size which is proportionate to their external impacts to incentive better use, contrary to arguments made for successive weight and length increases not borne out by reality.

Graph showing benefits of longer lorries is flawed

Goods moved by GB-registered HGVs, by type and weight of vehicle, 1990-2015 [DfT Table RFS0107]

We are not persuaded by the DfT trial of 7ft longer semi-trailers.For example the longer semi-trailers being trialled by DfT, which have dangerous tail swings, are only fully loaded for a third of their journeys: the extra length is not being used at all for around half of their journeys and that is in the best trial conditions. 11

Strategic Rail Freight Terminals can facilitate big growth in rail freight volumes

Rail/Road transfer terminals are key to improving freight efficiency as they allow both modes to play to their strengths and lets rail freight compete through economic of scales.

Joint analysis by Campaign for Better Transport and Malcolms, the operator of the Daventry rail freight terminal, shows that its Intermodal Rail Freight Terminal removed 64 million miles of lorry journeys from UK roads in the last year alone. Strategic Rail Freight Interchanges like Daventry are important economic generators and show the way the private sector is investing in and supporting rail freight. Rail Freight Interchanges enable rail to compete with HGVs by reducing the transhipment costs. Daventry Intermodal Rail Freight Terminal employs over 5000 people and is forecast to employ up to 9000 when its new terminal opens.12

Terminals of all sizes and scaled for different commodities are key. For example, in London and other cities, more aggregates terminals are needed to bring in construction materials into the heart of cities.  

1.2 Which are the key freight corridors that matter the most? What are the bottlenecks in the freight network and what investment in upgrades could deliver the best value for money for freight efficiency and UK PLC?
Freight bottlenecks tend to be in the same places for both road and rail. Significant freight corridors include the A14, A34, M6, M1, as well as the Channel Ports to London, and the Trans-Pennine routes including the M62.

Congestion costs the UK £30 billion in 2016 with the UK ranked the fourth most congested developed country and third most congested in Europe.13
We cannot build our way out of road congestion, and therefore need mechanisms to control demand. Building more roads alone will not solve the problems as it creates new traffic. When a new road is built, new traffic will divert onto it, a well-known and long-established effect ‘induced traffic’.14
Making more efficient use by lorries of existing roads, incentivised by distance-based charging, is part of the answer not only to the future challenges of freight movement but also to wider problems of congestion and pollution.
A sustainable freight strategy will combine distance-based road charging with a significant shift of freight from road to rail.

1.3 To what extend are the economic benefits of freight factored into wider transport infrastructure investment planning?
The fact that the benefit Cost Ratios for freight enhancements are very strong, typically in the range of 4:1 to 8:1, should be factored into investment planning. For example, Southampton gauge upgrades increasing market share from 29 to 36% within a year, with excellent cost-benefit ratio with 5:1 cost-benefit ratio.

The economic benefits of rail freight

KPMG estimates that for the calendar year 2016 rail freight delivered economic benefits totalling £1.7bn per year.15  This includes productivity gains for British businesses of around £1.17bn and congestion and environmental benefits of over £556m. If appropriate policies were put in place to encourage increased modal share of the movement of freight by rail using tools such as HGV charging these benefits would be further increased.

Graph showing economics benefits of freight

Improving competitiveness and delivery productivity

Efficiency gains and reduction in transport costs to customers have resulted in rail freight making a substantial contribution to the productivity of UK Plc by reducing the cost of transporting goods for Britain’s businesses and providing a high-quality level of service.  Since 1994 volumes have grown by 33%, whilst the turnover of the sector was broadly similar in 2017 to that of the mid-1990s in nominal terms.

The savings have largely been passed on to customers, resulting in improvements in the competitiveness of Britain’s businesses.  As a result it would cost rail freight customers nearly £1.2 billion extra a year to transport the goods currently carried by rail by road instead.  These are the productivity benefits for UK plc.

1.4 What are the regulatory and legal issues that, if changed, could improve freight efficiency without increasing costs or reducing efficiency?
The full extent of freight costs should be properly evaluated. Rail freight’s socio-economic benefits should be given greater weight in infrastructure investment decisions.

High external costs in the road haulage industry, caused by poor regulation where low quality operators undercut the professional operators should be remedied. Therefore, the Government needs to ensure and pay for proper enforcement of existing regulations. FTA figures show that HGV roadside encounter prohibition mechanical rates were 30 per cent and weight violations were 45.5% in 2015 for UK drivers.

2. How might the demand for freight develop and change over the next 20-30 years?
We refer the NIC to the responses from individual operators, while noting the inherent uncertainty given the potential impacts of new technology; urbanisation; impact of policy changes such as Clean Air Zones; and economic changes post-Brexit. We encourage the NIC to explore a range of scenarios, including those where traffic demand falls as well as growth scenarios.

2.2 How has the demand for freight, and types of freight, changed over the last two decades, and what will be the drivers for changes in the future?
Imports of consumer products from the Far East have resulted in consistent increased demand for freight services from the key container ports such as Felixstowe and Southampton. Rail freight volumes in this sector have increased 10 per cent since 2013/4 now accounting for 40 per cent of the rail traffic. This is a key growth market for rail freight with considerable suppressed demand because of the lack of rail capacity.
Customers want just in time service rather than holding large stocks. The latest change has been the demand for next day deliveries which is now been accelerated to same day delivery requests which is having a serious impact on congestion and the freight industry’s ability to consolidate. 
Coal traffic, which until 2012, accounted for a third of rail freight traffic, has declined steeply with an 82% reduction since 2013/4, now accounting for 8 per cent of traffic. 

Infrastructure and housing expansion
There has been a dramatic increase in rail freight traffic in this sector, which has seen record growth in the past quarter and now accounts for 25 per cent of traffic, having grown almost 20 per cent since 2013/4.
Rail can play an increasingly important role in this sector for both housing and infrastructure. Each freight train can carry enough materials to build 30 houses. Already rail is bringing up almost half of the aggregates into London and brought in the materials for Crossrail and removed the spoil.
The NIC should stipulate that using rail for delivery of materials for large infrastructure projects to railheads should be a planning condition.

Internet shopping and the service economy
There has been a huge growth in freight from the growth of online shopping and the wider service economy, for example with the increased home and businesses’ use of technology requiring servicing. Research on this has been sparse. There is an argument that the creation of several rival distribution networks, especially for parcel traffic, is inefficient and imposes externalities. It is unclear where future trends are going - for example 3D printing could radically change freight demand again. For more discussion of this, see http://www.bettertransport.org.uk/sites/default/files/pdfs/Tracks-Carbon-Reduction-Report-2017.pdf.

2.2 How is the freight industry planning for future changes in the demand? What levers might be available to shape future demand for freight transport
Levers available include the potential move to distance-based lorry charging. Currently, the industry is competitive but not efficient. The existing time-based system has neither led to efficiencies, nor reduction in emissions and collisions in the UK. Empty running is now at 30 per cent the highest level for years and load utilisation has not improved either.
With a direct relationship between the taxes per km travelled and the marginal costs which a distance-based charging system can provide, we anticipate greater operating efficiencies.

3. What effects does congestion have on the efficiency of freight movement and emissions?

3.1 How does congestion impact upon the productivity and economic contribution of freight? To what extent does congestion affect changes to mode, time and other freight choices?

Road operations must build in extra time to meet strict delivery slots at supermarkets for example, because of the unreliability of the road network.
Congestion on roads means that travelling takes much longer and journey times are less predictable.  The Department for Transport now estimates that congestion costs the UK economy around £4 billion per year16.  But Inrix puts a far higher cost on it. Congestion costs the UK £30 billion in 2016 with the UK ranked the fourth most congested developed country and third most congested in Europe. 17
We urge the Department to consider the role of rail freight in tackling congestion.  The consultation on the HGV road use levy does not consider the ability of rail freight to ease congestion on the road network.
For example, on the A34 route between Southampton and the West Midlands, one of the most congested roads in the country, with a poor accident record18, increasing the rail mode share from 35% to 50% would result in two thousand lorry loads a day shifting to rail, the equivalent of taking eight thousand cars off the road19

The ability for rail to dramatically reduce road congestion on some of the country’s busiest roads is important.  It highlights the need to holistically consider different modal interventions on a corridor-by-corridor basis when evaluating options to reduce congestion.  Cross-modal assessments will help understand the interventions that offer best value for money and are consistent with Government’s strategic objectives. 
Congestion is rightly identified as one of the UK’s greatest challenges.  It blights most of our cities and major urban areas where unplanned congestion causes delays to journeys.  The increase in unplanned delays and corresponding increase in journey times makes our cities less attractive and our businesses less productive/competitive. 

While unplanned delays, because of congestion, have a significant impact on the road network, this is a much smaller issue on the rail network.   The following chart compares unplanned delays on the road network, including city centre ‘A’ roads, the Strategic Road Network, and the national average, against unplanned delays of rail freight.

Table: Reliability of road and rail freight

Graph showing reliability of road and rail freight

While unplanned delays affect both modes, rail continues to be a far more reliable mode than road.  Average delay on the Strategic Road Network is now estimated to be 9.0 seconds per vehicle per mile20, 46 seconds nationally and 80 seconds per mile on ‘A’ roads in city centres.  Conversely only 4.4 seconds of delay per mile were caused on average nationally to freight trains in the year ending March 2017 21.
A key difference between the modes is that unlike road, rail freight is planned and timetabled with the assumption of no delay.  This fundamentally makes rail a much more reliable mode and, provides greater certainty, enabling customers to plan their logistics chain with greater efficiency. 
Logistics operators would use more rail freight services as a more reliable alternative to HGVs if the rail freight network was enhanced because of road congestion affecting reliability

3.1 How does congestion affect the environmental impacts of the movement of freight.

3.3 With limited space for new infrastructure, how can we better use our existing urban networks to support freight? Are there changes – such as changes to modes, methods or delivery times – that could help reduce the stress on the urban transport network?
City and sub-national authorities are recognising that the existing patterns of urban freight delivery are not sustainable because of the need to reduce carbon, air pollution, road congestion and the need to make safer cycling provision. 
One answer is to increase the volume of construction materials transported by rail into cities. Almost 50 per cent of aggregates are transported by rail into the capital. More rail freight terminals, such as that recently approved at Cricklewood in Brent, are needed to cater for housing growth in cities across the UK.Another answer is the use of rail connected consolidation centres/terminals on the edge of conurbations which freight can be transhipped into low emissions vehicles including electric cargo bikes for light goods.

Rail can fulfil the long-distance trunk haulage to the consolidation centres. Another model is to use passenger terminuses at night to bring in trainloads of freight into the heart of cities, when the passenger elements of the station are closed.  Two successful trials were carried out into Euston at night with Colas Rail delivering full train loads for Sainsburys and TNT respectively for transhipment into low emissions vehicles.

These policies are supported by the report Delivering the Future - new approaches to freight from the Urban Transport Group, formerly PTEG,  which  calls for smart logistics and highlights the essential role of urban freight in ensuring the effective functioning of the UK economy and presents a fresh vision designed to safeguard this role as well as protect the environment and quality of life for communities. This builds on earlier PTEG commissioned research, Freight in the City Regions 2013.
It envisages that every opportunity should be taken for freight to make its way to urban areas by rail or water, either directly into those areas, or into the major distribution parks that serve them. It argues that those distribution sites should be located so that it is practical for goods to travel the last mile(s) into urban centres using zero/low emission modes. These last mile journeys should be achieved as safely, unobtrusively and with as little environmental impact as possible.
The report explores several ideas that could assist in achieving this vision and calls for a broader, nationwide freight strategy to provide direction and leadership to the industry and its stakeholders.

Vans are lacking in regulation and consolidation
We also refer the NIC to the important research on freight produced by the European NGO Transport and Environment (T&E). T&E report that vans are responsible for 12% of the EU’s total road transport emissions. The current 147 g/km CO2 standard for vans in 2020 is dismally unambitious compared to the 95 g/km target for cars. A target of 113 gCO2/km should have been set for 2020 to require the equivalent cost-effective gains in fuel efficiency. As a result, improvements in van efficiency have been minimal, increasing operational costs for users. 22

One of the unforeseen consequences of charging is a migration away from the smaller HGVs to vans. Therefore there is also a strong case for extending the scope of the levy to vans that are used for the professional carriage of freight as such vehicles are being used to avoid laws that are applicable to trucks.

There is also poor consolidation in van traffic and flight from the lower tonnage HGVs to big vans. This is explored further in forthcoming research to be published by Campaign for Better Transport on air pollution and transport (“Time to clear the Air?”) which includes a section on light duty vans. We will share this with the NIC on publication.

4.How can freight lower its carbon and air quality impacts?
Both CO2 and air quality impacts can be addressed by transferring more freight to rail. Road freight is a big CO2 emitter, asHGVs contribute 17 per cent of surface access CO2 emissions, despite making up only 5 per cent of road vehicles. 23
Reducing emissions from road freight is expected to be challenging, confirmed in a report from AECOM: “it will be very difficult to meet the 2050 goals without major reductions in GHG emissions from Heavy Goods Vehicles (HGVs). 24

Furthermore, while electric technology means car and van emissions can be reduced significantly, the DfT has stated that it expects the existing HGV diesel engine technology to be predominant well into the next decade in its carbon review in February.

Emissions from HGVs constitute at least 16 per cent of carbon emissions from transport, and as reported in recent research for Campaign for Better Transport, the introduction of Euro V standards in 2008 and Euro VI standards in 2013/14 in fact saw a very slight increase in carbon dioxide emissions per kilometre due to engine modifications to improve air quality. The replacement of older vehicles with the latest Euro VI HGVs is therefore unlikely to reduce fuel use by a significant amount.25

Air quality
Upgrading HGVs to Euro VI engines can have a marked impact on air pollution. While the latest trucks with Euro VI engines represent a significant tightening of permissible emissions with particulate matter halved and NOx emission reduced by more than three quarters compared to 2009’s Euro V standards, the average HGV is seven and a half years old meaning only a quarter of lorries on the road meet Euro V standards and even fewer trucks meeting Euro VI standards.

The majority fall into the Euro IV and V brackets while 14 per cent of HGVs are over 13 years old. These older lorries are required to meet only Euro III standards or earlier which permit NOx emissions between 13 and 20 times higher than Euro VI and particulate emissions between 13 and 60 times higher source.

Reductions in vehicle kms as a result of efficiency would reduce emissions and improve air quality. The German distance-based charging system supports the purchase of cleaner trucks, especially for SMEs, of Euro V & VI, with the result that between 2005-2009 the proportion of Euro V and IV in the fleet rose from 2 to 62 per cent.

HGVs account for around 21 per cent of road transport NOx emissions while making up just 5 per cent of vehicle miles. 26  Any incentive to reduce HGV miles, such as a distance-based levy, will therefore make a positive contribution to improving air quality.

A shift to rail freight will play an important long-term role in reducing non-exhaust particulates (PMs). While the latest Euro VI engine technology reduces exhaust particulates, non-exhaust particulate pollution from HGV tyres and brakes, which is hard to reduce for trucks, will remain a serious problem for which there is no current solution, especially for trucks which have large tyres. 

4.1. Are there efficiencies within freight management and distribution practices that could help reduce the CO2 and NOx emissions from freight?

See Page 5 of this response – We recommend reform of the HGV and rail freight charging systems to remove the disparity between HGVs and rail freight

Distance based charging could bring about a significant reduction in lorry miles 27. There is detailed discussion on efficiencies in the report already cited.
http://www.bettertransport.org.uk/sites/default/files/pdfs/Tracks-Carbon-Reduction-Report-2017.pdf

Especially in chapter 9 Page 49 Carbon emissions from HGVs

This  is also discussed in forthcoming research which is due out imminently
Air pollution and transport Time to clear the Air? Page 38 Heavy duty vehicles
Go to www.bettertransport.org.uk

A table from this report is below

Typical emissions of Heavy good vehicles by main type and euro standard P34 from CBT report above

Graph showing typical emmissions of heavy duty vehicles by main type and euro standard

End tax loophole on refrigerated lorry units.

Campaign for Better Transport urges the Government to end a “tax loophole” which allows refrigerated lorries to use cheaper ‘red diesel’, other fleet operators use it to run unregulated secondary engines which power their refrigeration units.

Continuing to charge less for the fuel for these units will undermine efforts to clean up cities’ air quality by removing any incentive to move to cleaner fuel types. By hardly taxing diesel used for refrigeration units the Government is providing a perverse incentive for supermarkets and other companies to carry on using diesel, when instead they should be adopting alternative cleaner technologies. The current tax arrangements actually encourage the use of diesel refrigeration engines continuing to exist on supermarket lorries. Transport refrigeration units emit up to 93 times more NOx and 165 times more PM than the standards Euro 6 diesel car.

4.2 What role do alternative fuels such as electricity, liquid petroleum gas and biofuels have to play?
The Government needs to do research for alternative fuels for rail in the way that it does the OLEV research for HGVs.This is again covered in forthcoming research which is due out imminently and will be emailed to NIC on publication.Air pollution and transport Time to clear the Air? P41 the Impact of alternative fuels.

4.3 What technologies could best and most realistically be utilised to manage the carbon impacts of freight, both within urban areas and on longer strategic journeys?
The use of electric vans, which are no more expensive than diesel ones and electric cargo bikes for light goods should be encouraged in urban settings.

Electrification of rail network
Further electrification of the rail network would help the Government meet its sustainability targets and in particular reduce air pollution. It would encourage more use of electric traction by the rail freight industry as long as there are diversionary routes. Locomotives have a long longer life cycle of around 30 years whereas HGVs are around 5 years, so the industry has to make long-term investment decision based on Government policy at the time. Electric traction is tried and tested, it reduces maintenance costs and increases capacity. The Government should carry out research into alternative fuels for rail as it is doing for road.

The safety costs of freight should be evaluated and taken into account
Safety benefits of rail freight should be considered. HGV involvement rate in fatal crashes on local roads has doubled in the past ten years.
Our ten-year analysis of DfT Road Safety statistics, which show that HGVs are now twice as likely to be involved in a fatal collision on minor roads as they were ten years ago, demonstrates the benefits of reducing lorry miles. Despite only making up five per cent of overall traffic miles, HGVs are almost seven times more likely than cars to be involved in fatal collisions on minor roads.
Whilst cars are getting safer, HGVs continue to be dangerous in a collision because of their size and weight. The figures also reveal little or no improvement in the rates of fatal collisions involving HGVs on motorways and A roads. In 2014, on motorways, HGVs were involved in almost half (45 per cent) of fatal collisions although they only accounted for 11.6 per cent of the miles driven on them. 

Graph showing involvement in fatalities HGVs over 3.5 tonnes compared to all traffic
Source: Traffic statistics table TRA0104, Accident statistics Table RAS 30017, both DfT

The following DfT table shows the benefits of preventing collisions

Table showing valuation of the benefits of prevention of accidents

5 How could new technology be utilised to increase the efficiency and productivity of UK freight?

5.1 How will new technologies change the capacity and performance of the freight transport network? Over what timeframe might these new technologies begin to affect the freight transport network?

5.3 How do you see technology such as HGV platooning, digital railway signalling and autonomous vehicles being integrated into freight distribution?

The NIC should not be pinning its hopes on lorry platooning, (Ref NIC Interim report: Congestion, Carbon Priorities for National Infrastructure) which is in its infancy for dense road networks like the UK, whereas rail freight is already removing large numbers of HGVs from key transport corridors each day. The NIC Interim report proposal of   removing freight from the railways to platooning HGVs would have significant adverse economic, environmental and safety impacts as explained throughout this response.

Lorry platooning with driverless rear trucks could unquestionably reduce road haulage costs, but presents serious road safety risks, especially in bad weather, on our congested road network as highlighted by motoring groups. While the proponents state that the rear lorries will have drivers now, the longer-term aim, given that the technology is expensive, must be to run without rear drivers as their wages make up around a third of the traditional HGV running costs. It could also make it harder for independent hauliers, who still make up a large element of the sector, to compete with the big logistics providers. That is why there has been mixed reaction for the measure from hauliers and their representative bodies. Platooning could help the industry overcome its shortage of drivers, though.

While platooning could be viable in sparsely populated countries, there are serious safety and practical obstacles, such as cyber-crime, in allowing a procession of lorries on our congested motorway network which has frequent exits close together. Other outstanding issues include where these conveys will assemble and how they will work with so-called smart motorways, without hard shoulders for emergencies. Hauliers have raised concerns about how trucks with different sized engines and varying weights of loads will work together in a convoy.

Platooning, which is expected to reduce pollution by around 10 per cent, could seriously undermine rail freight which reduces congestion, is far safer and produces 76% less carbon dioxide emissions and up to fifteen times less NOx and 90% less particulates than trucks.

Platooning could also increase road damage costs; the standard truck is 138,000 times more damaging to road infrastructure than a Ford Focus. Additionally, driverless lorries are likely to need higher quality and more uniform road infrastructure and markings.28

6 Are there good example internationally of freight systems, policy, infrastructure or technology developments and implementation that the UK Can learn from to increase freight efficiency and or reduce the carbon and congestion impacts?

We commend the lessons of European distance-based HGV charging systems from German, Austrian and Swiss distance-based HGV charging, as reported in Freight on Rail response to Department for Transport call for evidence: reforming the HGV road user levy (January 2018).  Or at this link
http://www.freightonrail.org.uk/PDF/European_distance_based_charging_case_studies.docx

 

  1. Freight on Rail response to National Infrastructure Commission interim report: Congestion, Carbon Priorities for National infrastructure – January 2018
  2. Campaign for Better Transport: Invest in rail freight to cut road congestion, research shows 21 April 2017
  3. Campaign for Better Transport: New research shows just 2,000 less HGVS would mean a ten per cent reduction in air pollution 20 December 2017
  4. MTRU:Impact on congestion of transfer of freight from road to rail on key strategic corridors (March 2017)
  5. DfT: Empty running figures tables RFS0117 (July 2017)
  6. DfT: CSRFT data for 2016  issued in 2017 for Freight on Rail
  7. This is called the Generalized Fourth Power Law.
  8. Freight on Rail / Campaign for Better Transport response to Department for Transport call for evidence: reforming the HGV road user levy January 2018
  9. These include a range of effects including for the MSB report: up and downstream processes; soil and Water Pollution; nature and Landscape; driver frustration / stress; fear of accidents; community severance (including restrictions on cycling and walking); visual intrusion
  10. Freight on Rail: January 2018 http://www.freightonrail.org.uk/PDF/MTRU_addendum_to_the_2014_research_issued_in_Jan_2018.docx
  11. Freight on Rail: Report claiming benefits of longer lorries is flawed, say campaigners (September 2017)
  12. Freight on Rail: New figures show rail freight is far better at reducing congestion than previously thought. (May 2017)
  13. INRIX: Global Traffic Scorecard
  14. CPRE: The end of the road? Challenging the road-building consensus (March 2017)
  15. Rail freight in GB – productivity and other economic benefits, KPMG, 2018
  16. Road works: The future of lane rental, Department for Transport, 2017
  17. INRIX: Global Traffic Scorecard
  18. https://hansard.parliament.uk/Commons/2016-10-26/debates/F0B582CB-C642-4090-95F5-7B9972350634/A34Safety
  19. Impact on congestion of transfer of freight from road to rail on key strategic corridors, MTRU, March 2017
  20. Travel time measures for the Strategic Road Network, England: 2016, Department for Transport, 2017
  21. Average delay on local ‘A’ roads: monthly and annual averages, Table CGN0502, 2017
  22. Transport & Environment: Small electric vans cost the same as dirty diesel ones today but are in short supply 15 February 2018
  23. DfT Freight Carbon Review (February 2017)
  24. AECOM report ECO driving for HGVs (December 2016)
  25. Campaign for Better Transport: Tracks report, Environmental quality climate change and transport innovation December 2017
  26. DfT Freight Carbon Review (February 20017)
  27. Freight on Rail / Campaign for Better Transport response to Department for Transport call for evidence: reforming the HGV road user levy
  28. Campaign for Better Transport: Rail freight better way to cut congestion and pollution than lorry platooning (August 2017)

 



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