Port move makes no sense

Anyone who has been to Rotterdam in the Netherlands will know it is a port city that embraces both its rich history, and its future as Europe’s largest sea port. Real estate with a view of the port is prized. Government has always considered the enormous economic might of the port in making decisions about Rotterdam’s development.

It would be good to see the New Zealand Government holding such pride in, and support for, the port in our largest city of Auckland, which is a critical part of the country’s infrastructure. Instead, Ports of Auckland has become a political football.

In December, the Cabinet of the New Zealand Government will consider relocating to Northport, in Northland, the movement of goods currently carried out by Ports of Auckland. The economic advice behind that proposal has been called into question by two reviews from economic analysts, released by Ports of Auckland this week.

Castalia’s report says it will cost about $6.7 billion to move the freight activities of the port in Auckland to Northland. That is almost four times higher than EY’s predicted net cost of $1.8 billion that has been used to sell the idea of the move.

As representatives of freight movers, the RTF strongly urges the Government to take a good look at all the facts and figures before making a decision. If the aim is to boost Northland’s economy, does that really stack up against the impacts for Auckland and the rest of New Zealand?

It’s clear that making Northport the main port for Auckland will require massive investment in road and rail, and frankly, it makes little sense from either an economics or a logistics position. Why would you move goods destined for delivery in Auckland and further south away from the closest port, when the road and rail infrastructure required to then get those goods from that far away port back to Auckland and beyond does not even exist?

You can’t just one day close a major port and open another one that same day. There would need to be overlapping operations for years, with costs galore that would have to be passed on down the line to the end consumer. New Zealand’s location at the bottom of the earth already makes it expensive to import and export goods; we can’t really afford to add to that.

Rather bizarrely, those advocating to relocate the port operations are only talking about freight. They want to keep the economic benefits of having cruise ships and their many well-heeled passengers spending their cash in Auckland. The port has to remain in some capacity, which defies logic.

It smacks of a desire to kick out the blue-collar industries because inner-city businesses and residents don’t like the look of them. Reverse sensitivity seems to be a peculiarity of New Zealanders. People move to the inner city and then don’t like the noise, or bars, or trucks, or cars, or people. International city dwellers at least understand where more than a million people gather – and let’s remember Auckland is a very small city in global terms – there is noise and a changing landscape.

Castalia says the freight that currently flows out of Ports of Auckland would have to travel an extra distance to and from Northport of about 200km by rail and 150km by road. The additional freight task (approximately 400,000 twenty-foot container equivalent unit round trips between Auckland and Northport) will require additional transport infrastructure. On the possibly inaccurate assumption that 70 percent of the additional freight task was handled by rail, there would be more than 500 additional truck journeys per day travelling between Auckland and Northport for container traffic only, with more if the car import business uses the road network. This is just not feasible with the current road network between Auckland and Northport.

The freight task is increasing and the upper North Island is expected to account for most of New Zealand’s population and economic growth over the next 30 years. Ports of Auckland has a 30-year plan, which gives it the capacity to handle the expected freight increases.

On one hand you have an established business with a plan to match growth and on the other you have a pipe dream. The Government cannot sink billions of dollars into this without much better analysis than it currently has before it. New Zealand has to remember its place in the world and not price itself off the market on an act of sheer folly.

– Nick Leggett, CEO, Road Transport Forum

Let’s get practical about climate change

While politicians and celebrities gnash their teeth and shout to anyone who will listen that we are in the middle of a climate change “crisis” or “emergency”, a lot of others are looking at practical and workable solutions to stop the mercury rising.

None more so than those at the local government level, where they actually mop up after a real crisis or emergency, including those caused by dramatic weather patterns or natural disasters which generally impact at a local, rather than national, level.

So, it was interesting this week to present at and be part of a panel discussion at the Road Controlling Authorities Forum in Wellington, looking at the impacts of climate change in relation to transport.

Without question the freight and logistics sector will face increasing pressure from both government and our customers to reduce emissions. But we possibly aren’t as bad as people think.

The energy sector accounts for about 40 percent of New Zealand’s Greenhouse Gas emissions, with transport fuels about 17 percent of that total. About five to seven percent of emissions come from the heavy transport industry.

Road freight transport intersects with those controlling roads on the climate change front in areas such as delays due to extreme weather and storm events; infrastructure condition deteriorating faster with extreme heat or excessive rain; and bad roads causing delays and increasing safety risks such as, more road works, driver fatigue, and additional time-costs for end consumers.

In a real crisis or emergency, local and central government will be more reliant on roads than other parts of the transport network. With increased coastal inundation, or a natural disaster like an earthquake, many rail lines are quickly out of commission. Roads also suffer, as quite a lot of our main highways are vulnerable to such events, but there are usually alternate routes and events are localised, so other parts of New Zealand can supply an affected area, by road.

New Zealand is leading the way in looking at mitigating climate change and we support the principles of the Zero Carbon Bill, currently being considered by the Environment Select Committee.

But we  think that addressing climate change is more than focusing on net zero emissions by 2050. It is also looking at making our infrastructure network resilient and planning for events along the way.

On the emissions front, road freight is a sector that quickly adopts technology efficiencies. Noxious emissions from trucks have been slashed by 98 percent in the past 20 years, through use of technology. European emission standards are applied to much of the heavy vehicle fleet to reduce levels of harmful exhaust emissions, currently Euro Standard 6, which requires an additive to be used in fuelling heavy diesel trucks.

While there are electric options for car drivers, any real alternative fuel vehicle at the heavy truck level is still some way off. In the rush to remove reliance on fossil fuels, we need alternative energy sources in place. And we need to look at the whole picture, for example, the batteries that power green vehicles have been linked to human rights abuses in the mining of lithium and cobalt.

Our industry is keen to find solutions in New Zealand – we are known for our problem-solving and innovation, so let’s lead the way here if we can.

TIL Logistics has partnered with New Plymouth-based Hiringa Energy to develop hydrogen fuel cell technology for its transport vehicle fleet and they hope to begin their first hydrogen vehicle trials in 2020.

It will be interesting to see the results of the trials both here with Hiringa and overseas, where similar research and development is underway, as to whether hydrogen fuel cells and the complex infrastructure that comes along with that technology can displace the battery-based electric motor as the clean alternative for heavy transport.

I recently visited Tranzurban, in Wellington, and using their own ingenuity they have built the first full electric double-decker buses in the world, made up from components they have sourced and put together in a unique way.

There’s still a long way to go, but our industry is poised to take a bigger role in the movement to combat climate change in a global sense. At the same time, individual companies are looking at their sustainability obligations to meet their customers’ expectations and be good global citizens. And when the real crisis, catastrophe, or disaster happens, we’ll be there delivering the goods.

Please note: Being uncomfortable with changing the meaning of the words crisis and emergency does not make me a climate change denier.

– Nick Leggett – CEO, Road Transport Forum