Sustainability in the Transport Sector in Europe: Focus on the So-called “Last-mile Delivery”.
Info: 19045 words (76 pages) Dissertation
Published: 16th Dec 2019
Transport plays an essential role in our society. It connects people, urban areas and nations. It is one of the main pillars of our economy, by allowing suppliers to sell goods and services all around the world, creating millions of employments and spreading wealth. Transport strongly affects our every-day life: it provides access to health services and instruction, it allows us to travel and discover different places, and it influences the products that are offered and the ones we consume, contributing to a better quality of life. The positive effects of transport are more than evident, yet it is essential to bear in mind that this sector likewise has a profoundly negative impact on the environment and the general public: air pollution, traffic and noise are only a few of the several negative externalities generated by transportation.
This work aims to analyse the level of sustainability from an environmental, economic and societal point of view of the transport sector in Europe, with a particular focus on the so-called “last-mile delivery”.
Following the Introduction, the Literature Review is divided into two main parts focusing on specific themes. The first section, Transport in Europe, provides a general overview of the transport sector, investigating the different transport systems and the various negative externalities they generate. As anticipated above, the analysis will follow the triple bottom-line framework, examining the impact the sector has on People, Planet and Profit.
The second part of the review, Focus on the last-mile, analyses the last-mile delivery. It examines the major trends and features of this section of the supply chain, which, especially in recent years, has become a hot topic for transport regulators. After a brief introduction on e-commerce, which caused the boom of home deliveries since 2000, I will analyse the different types of deliveries and the features of logistics policies of this last step of the supply chain.
The last chapter, Possible solutions, provides some ideas to overcome the existing shortcomings, analysing some of the potential answers that could make the last-mile delivery more efficient and sustainable, with a particular focus on some project approved and funded by the European Commission.
2. Literature Review
In recent years, awareness of climate change and its effects on the environment and the society has increased a lot, and transport has soon been identified as one of the main contributors to this urgent problem. Many international organizations and institutions, such as the European Commission (EC), the European Environmental Agency (EEA), and the United Nations (UN), have started to highlight the connection existing between the transport sector and climate change, and to propose remedies and solutions to adjust the situation. This has been and continues to be done, through the publication of numerous papers and reports based on the studies conducted on transport sustainability.
Within the transport sector, in recent years great attention has been dedicated to the so-called “last mile”. Consequent to the huge boom of e-commerce and home delivery, this final step has become one of the most critical and inefficient parts of the entire transport chain. It is evident that some policies and solutions must be implemented to make it more efficient and sustainable.
2.1 Transport in Europe
It would be impossible to imagine our life without transportation. Transport connects people, nations, and oceans, and it is one of the main pillars of our economy. It sustains growth, by creating millions of jobs and allowing products and services to circulate all around the globe. It ensures the access to some essential public services, such as health and education, enhancing people’s quality of life. Thanks to the development of technology, mobility has become more and more efficient, allowing both individuals and goods to travel faster, further and more cheaply than ever before. If on the one hand, the positive effects of transportation are countless, on the other hand, it is important to recognize that it also presents numerous drawbacks. Accidents, air pollution, congestion, and noise are only a few of the several negative externalities of the transport sector, which have a highly adverse effect on both society and environment.
2.1.1 Key facts, trends and expectations
The transport sector can be considered the backbone of Europe. The Trans-European Transport Network (TEN-T) consists of more than 136.700 km of roads, 138.000 km of railway lines and 23.506 km of inland waterways. Only in 2014, around 879 million passengers travelled by air in the European Union, and 3,8 million of goods were handled in the EU ports.
Today, interest and demand for transport are substantially higher than in 2000, and they are expected to grow steadily in future years, consequent to the projected economic and demographic growth. According to the European Environmental Agency’s estimates, disclosed in its 2016 report “Towards clean and smart mobility”, in 2050 good transport will grow by more than 80%, and passenger transport by more than 50% compared to 2013 levels. It is evident that the transport sector needs to adjust to a changing society, characterized by a larger and older population, and to climate change, which has turned into a greatly hot issue.
In the 1990-2013 period, the EU-28 population grew by 6.3%, reaching 505 million people. As a consequence of this demographic growth, transport demand strongly increased, and in parallel fuel consumption and greenhouse gas (GHG) emissions.
Transport is the only EU sector whose GHG emissions have ascended, growing by 22% from 1990 to 2013, representing in 2014 almost 25% of EU’s total GHG emissions, with Heavy-Duty Vehicles (HDVs) contributing approximately 20% and passenger cars a further 45% on the sector’s emissions. Transport is a rare exception since in the same period the total human-made GHG emissions of the 28 EU Member States decreased by 17%.
However, it is fundamental to point out that even if the global emissions of GHG were interrupted today, climate change would not disappear immediately. On the contrary, it would continue for many years, if not decades, because of past emissions and the inertia characterizing the climate system. This statement should not be read in the perspective that “it is already too late”. On the contrary, this awareness should prompt us to act as soon as possible, precisely because of the slow reaction of the climate system: the sooner we start doing something, the better. (Source: 2014 EEA report “Adaptation of transport to climate change in Europe”)
When analysing the growth of transport demand and its related emissions, it is worth noticing that the 2008 financial and economic crisis marked a clear break. While the trend throughout the period is rising, following the economic recession demand for transport and emissions have been decreasing, with the only exception of aviation.
Therefore, when assessing the capacity of the sector to meet the ambitious EU environmental goals set by the European Commission, it is important to take into account that this downturn is (at least partly) cyclical, and due to an extremely peculiar economic scenario. Moreover, it is important to notice that the tough economic situation has not affected transport modes uniformly. Today, it is still not clear the correlation between transport demand and changes in economic activities in Europe. (Source: Directorate General for internal policies. (2015). Research for TRAN committee – greenhouse gas and air pollutant emissions from EU transport.)
Despite the numerous differences among the European Countries, demand for transport at the European level has some peculiar elements. Among them, we can list the significant prevalence of road transport for both cargo and passenger, in opposition to the decrease of rail in freight transport, the expansion in the utilization of metro and tram in cities and urban zones, and the unimaginable increment in air traffic.
In spite of the immense advances in technology and innovation of recent years, which made the sector cleaner and more efficient compared to the past, transportation remains one of the major sources of pollution. Public authorities have realized the need to make transport, among the other sectors, more efficient and sustainable. It is the only way to meet the eager objective set in December 2015 at the Paris Conference to hold “the increase in the global average temperature to well below 2 °C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 °C above pre-industrial levels” (cit. “Inside The Paris Climate Deal – The New York Times.” 12/12/2015 website: https://www.nytimes.com/interactive/2015/12/12/world/paris-climate-change-deal-explainer.html).
It is imperative to take into account, as highlighted in the 2014 EEA report “Adaptation of transport to climate change in Europe”, that not only the transport sector has to change in order not to add further adverse effects on climate change, but that changes in climate and environment, such as floods, storms, and heat waves, are already having a massive impact on mobility throughout Europe. Rising temperatures increase the issues of rail fastening and road downgrade. Climate extreme conditions causing landslips and floods can provoke delays and viability problems. Sea-level ascent can devitalize ports and other transport infrastructure and services in coastal areas. Air traffic can be put on trial by changes in wind pattern and other climate events. Moreover, some environmental changes can likewise have severe impacts directly on the society and the economy, negatively impacting on tourist destinations or agriculture and farming. It is evident that environmental change and transport are affecting each other, and actions have to be taken as soon as possible to prevent the situation from getting worse.
Numerous European Union’s transport policies are based on the “user/polluter pays” principle. Unfortunately, the prices currently paid by users do not reflect the full cost that transport has on the environment and the society. As expressed by the EEA in its report “Towards clean and smart mobility”, fuel prices tend to be too low to send a strong signal. Moreover, they can easily be distorted by transport subsidies. The introduction of subsidies can provide a solution. In some cases, they can be effective, by promoting cleaner and more efficient modes of transport (e.g. subsidies on public transport; tax incentives on electric or hybrid vehicles). On the contrary, in other cases, subsidies can result to be environmentally harmful. Although the abrogation of environmentally harmful subsidies would lessen environmental pressures, it is important to recognize that this must be weighed against the negative impacts that might arise somewhere else. Some examples of transport-related environmentally harmful subsidies are tax exemptions for international transport fuels, subsidies for company cars, and taxation of commuting expenses.
Fuels used for international ship and plane transportation is usually exempted from national tax assessment. This provides an incredible advantage to air travel, by distorting competition between different modes of transport for certain long‑distance travel. According to the study conducted by Korteland and Faber in 2013, just within the EU, the lack of fuel tax assessment on international flying has led to a diminishment in public revenues of EUR 20-32 billion per year. As far as marine transportation is concerned, the environmental implications of the fuel tax exemptions remain unclear. From one perspective, the direct impact of these exemptions is to expand transport activity in the maritime and inland waterway sector. On the other, by enhancing the competitive position of water transport concerning road transportation, this tax exemption can help moderate the environmental impacts of road transport, by reducing road transport-related CO2 emissions and noise nuisance. However, it is unlikely that allowing for tax exemption for water fuel is the best way to compensate for the lack of internalization of the external costs generated by road transport.
Organizations’ cars represent around half of European new car sales. Tax benefits for company cars, which are extremely popular in Europe, may have several destructive consequences on the environment. In fact, the current tax settings frequently give motivations to people to drive more or implicitly provide incentives for purchasing larger, and consequently less fuel-efficient, cars. Moreover, tax levels incentivize companies to get company cars, leading to a larger vehicle fleet. In summary, this system tends to provide the minimal incentive for employees to limit the number of trips, distances driven and fuel consumption, and consequently GHG emissions.
In the European Union, eleven Member States allow their citizens to detract personal commuting expenses from the taxable income. The majority of governments likewise implicitly subsidize commuting by public transport through their support for public transport fares. Practically speaking, the environmental impacts of commuting subsidies depend on the details of their design: a general tax concession for all commuting trips could easily lead to the promotion of commuting by car, longer trips and consequent urban sprawl. Conversely, public subsidies promoting public transportation could provide environmentally-friendly solutions.
To prevent the situation from getting worse even further, the European Union has set some ambitious goals to be met by 2050. The goals and targets are reported in the 2011 “With Paper on Transport, Roadmap to a single European transport area — Towards a competitive and resource-efficient transport system”. A complete list is provided in Appendix 1, but some of the most relevant targets are the following ones:
- By 2030, transport emissions (excluding international maritime) must be reduced by 30% compared to 1990 levels, and by 2050 they must reach 60% of reduction;
- By 2050, international maritime emissions must be reduced by 40% compared to 2005;
- By 2050, oil consumption must be reduced by 70% compared to 2008 levels;
- By 2020, for each EU Member States, the share of renewable energy consumed in transport must be at least 10%.
Thanks to technology, vehicles are becoming cleaner and more energy-efficient. However, there are concerns regarding how emissions are calculated and measured. The testing procedure currently used in Europe, the New European Driving Cycle, was introduced back in 1970 and was last edited in 1997. European transport has changed extensively from that point forward, and the system is no longer able to reflect the real-world driving conditions. Cars have turned out to be faster and heavier, and streets more congested. Moreover, the present strategy permits manufacturers numerous flexibilities in testing parameters, among which vehicle mass, adjustments to brakes and tire pressure. Consequent to the combination of these factors, vehicles tend to produce essentially higher emissions of carbon dioxide on the street than in a laboratory under the present testing strategy. As indicated in the research conducted by the International Council on Clean Transportation (ICCT), real-world CO2 emissions are up to 40 % higher than the ones measured in the testing research facility. Perceiving such weaknesses, in January 2016, the European Commission proposed various changes to the present vehicle type-approval structure. These are intended to fortify the independence of vehicle testing and enhance the requirement and market surveillance regimes. Another emissions testing system, the ‘Overall orchestrated Light Vehicles Test Procedure’ (WLTP) will likewise be introduced shortly, with the goal that lab results can better represent the real vehicle performance on the road. (Source: Towards clean and smart mobility)
2.1.2 Transport modes
In this section, I am going to analyse the main transport modes, which are:
Road transport is a fundamental economic activity: it brings people together, and it conveys goods where they are required. Moreover, it employs about 5 million people (2 million carrying passengers and 3 million moving goods) and generates a joined turnover of EUR 470 billion (EUR 330 billion in passenger transport and EUR 140 billion in freight transport).
Road freight transport accounts for almost 50% of the total freight transport activity in the EU, and it has not completely recovered from the 2008/2009 economic and financial crisis. However, lately, it has been registered a steady growth in activity. From 2012 to 2015, road cargo transport has grown by 4.3%, even though in 2015, it was still some 8% below the pre-crisis peak in 2007, and only slightly above the 2010 level. The progression has not been uniform across the EU: while the overall amount of tonne-km increased by 0.7% in the 2010-2015 period, at the level of individual Member States the situation is extremely variegated, with growth rates ranging from +66% (Bulgaria) to -48% (Cyprus). Empty runs are a waste of assets and resources, and the standard EU transport policy aims at reducing them as much as possible. At times, empty runs cannot be avoided for technical or operational reasons. In 2015, about 23% of all vehicle-km by heavy goods vehicles in the EU were empty runs. Still, there is a positive trend: in fact, in the last ten years, the share of empty runs has decreased by two percentage points.
Road cargo traffic is projected to increase by about 57 % between 2010 and 2050, but the growth will be uneven: EU-13 will grow much more than EU-15. As far as road passenger transport is concerned, numbers are much lower than for road freight transport. In the EU, there are about 362,000 enterprises whose primary activity is to carry passengers on the road, and 83% of them provide taxi services. (Source: An Overview of the EU Road Transport Market in 2015)
Road transport is a relevant source of air pollutants, and consequently a great contributor to GHG emissions. Despite improvements in vehicle efficiencies made over the past decades, in the 1990-2014 period, road emissions increased by 17%. Nowadays the sector contributes to almost 20% of total Europe’s GHG emissions and nearly 73% of GHG emissions of the EU-28 transport sector.
Thanks to the advancements in technology, new levels of vehicle automation are available. This has the potential to make European roads safer, reduce CO2 emissions, and sharply diminish the time spent in traffic. In recent years, more and more hybrid and battery-electric vehicles are being sold in EU, but they still account for just 1.3% of all new cars, despite the significant financial incentives provided. (Netherlands 12%; Denmark 8% of cars sold in 2015 were electric or plug-in hybrid). (Source: EC, 2016 “Towards clean and smart mobility”).
The first European Council Directive that specified measures against air pollution from motor vehicles was in 1970. 22 years later, in 1992 the “Euro” emission standards were introduced, starting with the “Euro 1”, followed by progressively stricter standards, from “Euro 2” to “Euro 6”. At present, only “Euro 6” vehicles can be sold in the EU. These standards have been introduced to limit emissions from passenger cars. They regard various air pollutants, including NOx and PM, and set different limits per pollutant for petrol and diesel vehicles. In addition to the “Euro” standards, in order to reduce the European level of GHG emissions, the Union has introduced increasingly stringent mandatory targets for CO2 emissions of new passenger cars and vans. For example, new cars had to achieve the average emissions target of 130 grams of CO2 per kilometre (g CO2/km) by 2015 (target achieved two years ahead of the deadline) and of 95 g CO2/km by 2021. Similar targets have been set for light commercial vehicles (vans). New vans must meet the average emissions targets of 175 g CO2/km by 2017 (target achieved four years in advance), and 147 g CO2/km by 2020. (Source: Explaining road transport emissions)
In October 2014, TNS Opinion & Social network carried a survey (from now on referred to as “the Survey”) on behalf of the Directorate-General for Mobility and Transport in the 28 Member States of the European Union, with the aim to investigate about citizens’ perception of the quality of transportation in the EU.
As far as road transport is concerned, from the Survey it emerged that there is a divergent opinion over whether the quality of road transport has improved (38%) or deteriorated (36%) in the last five years. Cars resulted to be the most used mode of daily transport (54%) followed by urban public transport (19%). Regarding road safety, more than half of the respondents (56%) said improving road maintenance should be the priority, and almost as many mentioned zero alcohol tolerance (49%) as extremely important. 60% said congestion was the most severe problem for roads in their country, pointing a very critical issue which is a tremendous burden for the economy (Source: Quality of transport).
Rail transport sector plays a fundamental role in the EU economy, employing about 559.600 people, across both passenger and freight operations, and presenting a turnover of €73.108 billion (Source: EU Transport in Figures: Statistical Pocketbook 2016, EC). It is also critical to the EU strategy for enhancing economic and social union and connectivity both within and between Member States, including through the further improvement of the Trans European Transport Network (TEN-T) rail corridors. Moreover, it is expected to play a significant role in reducing GHG and other emissions from the transport sector. The advancement of this mode of transport has been supported and promoted for more than two decades through the implementation of an extensive legislative framework. Accordingly, the 2011 White Paper, Roadmap to a Single European Transport Area – Towards a competitive and resource efficient transport system, promotes a more extended use of rail transport in the future. More specifically, the White Paper includes various rail-related goals promoting a more efficient and sustainable transport system for the EU, specifically:
- By 2050 the majority of medium-distance passenger transport should go by rail;
- 30% of road freight over 300km shifting to other modes by 2030, and 50% by 2050;
- Completion of the European high-speed rail network by 2050, and maintaining a dense rail network in all Member States;
- The establishment of the framework for a European multimodal information, management and payment system by 2020;
- A fully functional TEN-T core network by 2030, with a high quality/capacity network by 2050;
- Connection of all core network airports to the rail network (ideally the high-speed network) by 2050;
- Deployment of the European Rail Traffic Management System (ERTMS);
- Full application of user pays/polluter pays principles in transport.
However, while the rail sector has accomplished tremendous volume growth in recent years, rail’s modal share remains below expectations, representing just 6.6% of traveller km and 10.8% of tonne-km within the EU-28 in 2012 (Source: EU Transport in Figures: Statistical Pocketbook 2016, EC). This is viewed as symptomatic of a general overall lack of competitiveness driven by insufficient investment and inadequate customer-focused innovation across the EU (Source: Fourth Report on Monitoring Development of the Rail Market, EC 2014), notwithstanding that the sector also absorbs at least €36 billion of public funds annually.
Consequent to these and many other factors, rail sector has failed to challenge predominance of road in both passenger and cargo transport and, in spite of the extensive development of high-speed networks, it has not been able to capture the little yet enduring increment in the offer of short to medium distance transportation. In addition, ongoing constraints on the availability of public funds following the financial crisis are expected to diminish the resources that were usually available for rail investment in several European Countries. (Source: Study on the Cost and Contribution of the Rail Sector, 2015)
Passenger rail activity is expected to rise by 76%, and to raise its modal share of 2 percentage points (from 7.7% to 9.7%) during the 2010-2050 period. Around 32% of passenger rail traffic is expected to be carried by high-speed rail by 2050, compared to 21% in 2010. As far as rail cargo is concerned, it features the highest growth among the inland freight transport modes and it is projected to increase its modal share from 15% in 2010 to 18% in 2050. Once again, this growth is mainly due to the presence of TEN-T network. (Source: Full Reference Scenario 2016)
In the ten years to 2013, the European rail sector encountered a demand expansion of 61.8 billion passenger kilometres, corresponding to an annual average growth of 1.6%. Further, rail’s share of surface passenger transport was 7.4% in 2013. In any case, the scenario changes a lot among the different Member States: the most significant increases in rail demand have been recorded in Western Europe, with Austria, Luxembourg, the Netherlands, Sweden and the United Kingdom all encountering an annual growth in rail passenger kilometres of at least 2.5%. Conversely, eleven European Countries have faced a declining rail patronage over the same period. In Romania, rail usage fell by more than 6% per year, followed by Lithuania (-4.3%), Greece (-3.9%) and Bulgaria (-3.2%) (Source: Study on the prices and quality of rail passenger Services, 2016)
As far as rail transport is concerned, 34% of the respondents of the Survey said that rail transport quality had improved in the last five years, 27% said it had deteriorated, while according to almost one in five (17%), it had remained the same. Ticket prices were considered the most serious problem for rail transport (46%), followed by missing links and track maintenance. (Source: Quality of transport)
The Single Aviation market started to be implemented in 1992. Since then it has experienced several relevant changes. The airline scenario has transformed a lot: most significantly, there has been a critical tool in the market share of low-cost carriers (LCCs), particularly on short distance travels. LCCs, notably easyJet and Ryanair, have taken advantage of the single market to expand their operations all over the EU. However, their growth in market share has slowed since 2009. In 2013, at the EU-28 level, around 426,000 people worked directly in air transport activities: 89% of them were employed in passenger operations, while the other 11% in freight air transport. Passenger traffic has proliferated, invigorated by lower fares, new business models, and a wider choice of services provided. Over the period 2000-2013 passenger traffic in EU-28 has increased at an average compound rate of +3.0% p.a. The pick of this growth was experienced in the first part of the period, while like for many other transport modes, growth slowed in 2008 and reversed in 2009 due to the financial crisis. (Source: Study on employment and working conditions in air transport and airports).
In the 2010-2050 period, passenger transport is projected to grow by about 40%, with aviation as the fastest growing sector. The highest air traffic growth is expected in the EU-13, thanks to their faster-growing GDP per capita and the available capacity of their airports. Consequently, also the related GHG emissions are estimated to grow, especially the transport-related ones, of which air transport represents the largest share. More aspiring environmental policies should be implemented so to mitigate the adverse environmental impacts of the growing air transport activity. Some examples can be more efficient and silent aircraft, the utilization of alternative fuels, and the improvement of air traffic management. Between 2000 and 2014 GHG emissions by European aviation have increased by 12% despite better fuel efficiency, and in the 1990-2014 period aviation emissions almost doubled (Towards clean and smart mobility). It is important to take into consideration that interventions at the EU level are not enough. International cooperation is needed to support the transition towards sustainable aviation transportation. (Source: TERM 2016).
As far as the perceived quality of air transport is concerned, 36% of the respondents of the Survey said that, in their country, it has improved in the last five years. According to the 13%, it has deteriorated, and 32% of them were not able to answer. As far as the problems related to aviation, ticket prices were most likely to be considered the more severe problem for air transport (37%), followed by air pollution, lack of destinations from the closest airport, and availability of public transportation to and from that airport (all 16%). (Source: Quality of transport)
As reported in 2011 With Paper, maritime bunker GHG emissions have to be reduced by at least 40 % from 2005 levels by 2050. As expressed in TERM 2016, since 2007, the EU CO2 emissions of maritime transport have known a downward evolution, and in 2014, EU GHG emissions of navigation represented 13% of total EU-28 transport emissions (source: Statistical Pocketbook 2016).
Waterborne transport plays a fundamental role in both global and European economies. The United Nations Conference on Trade and Development (UNCTAD), estimated that sea transports around 80% of the volume of world trade, and this share is projected to grow consistently in the next years. Specifically, at the European level, shipping represents up to 90% of EU external trade, and 40% of the internal one. In Europe, shipping employs around 2.5 million people, including shipbuilding, and the European fleet is about 40% of the global one. Despite being seen as a relatively energy-efficient and climate-friendly transportation mode, maritime transport negatively affects the environment, human health, and climate. There is a scope of choices that port managing bodies can apply to reduce the adverse effects of maritime transport on the environment, such as offering incentives to the shipping industry, so to carry out more environmentally-friendly operations. The International Maritime Organisation (IMO) is responsible for pollution issues and, over the years, it has adopted a broad range of measures to prevent and control any harm caused by maritime transport, and to mitigate its adverse effects. At first, the IMO focused only on prevention of marine pollution by oil, while nowadays it includes a significantly more extensive scope of measures to prevent marine pollution, garbage and sewage. Moreover, in perspective of the Paris agreement, the Marine Environment Protection Committee (MEPC) of the IMO concurred that IMO ought to decide a conceivable fair share contribution for the international shipping sector, which should consider the significant conditions to the global shipping industry, including the importance of international exchange in supporting the sustainable development of national economies. At the meantime, the MEPC noticed that shipping is already the most energy efficient mode of freight transport. Thus any increase in shipping activity caused by a shift from other less efficient transport modes will contribute to an overall reduction in the global share of CO2 emissions. However, an unrealistic contribution to reducing the sector’s absolute CO2 emissions could prompt a shift to less energy-efficient transport modes, an action that would be counterproductive. (Source: Study on differentiated port infrastructure charges to promote environmentally friendly marine activities and sustainable transportation)
As stated above, maritime transportation is fundamental to the European economy, being the backbone of the cargo transport. The European shipping sector is facing worldwide competition, particularly over the long-distance routes. Consequently, there is a need for the EU to cooperate with international partners and to play an active role in the global scenario to both guarantee quality shipping and to promote the European competitiveness worldwide. Waterborne transport represents a competitive and more environmentally friendly alternative to road transport. Competition in the shipping sector has increased significantly over the past years, especially after the 1980s EU market liberalization, and shipping companies are now merging in order to benefit from economies of scale. However, a fully liberalized market has not been achieved yet. In particular, both inland waterways transport and short sea shipping face higher administrative burdens compared to land transport, which prevents their development and distorts multi-modal competition. (Source: The world is changing, transport too)
Notwithstanding being viewed as the cheapest way to transport goods around the world, shipping remains a profoundly volatile sector, susceptible to boom and bust of the economy. As reported in figure 7, the sector’s share of GHG emissions is much lower than those of road transport. However, its environmental impact is nevertheless growing. The shipping industry is projected to emit around 1 billion tonnes of CO2 per year, and this is estimated to reach 1.6 billion tonnes by 2050. According to IMO’s latest figures, if no action is taken, GHG emissions from shipping will increase by up to 250 % by 2050, representing 17 % of global emissions. (Source: Towards clean and smart mobility)
In 2013, following four years of downturn, EU-28 maritime passenger traffic recorded a 0.5% increase compared to 2012, accounting for nearly 400 million passengers. As far as maritime turnover is concerned, in 2013, Northern Europe ports achieved 70% (around 67 million), while Southern (e.g. Mediterranean) ports achieved only 30% (around 29 million). In 2014 the most remarkable growth of maritime passenger was registered in Poland (5.43%) and Malta (5.32%), while the most significant drop was recorded in Denmark (-54.75%). In 2014, Italy and Greece registered more than 33% of EU-28 maritime passenger transport. Italy and Greece maintain their leading position also when cruise passengers are excluded, considering both national and international transport. From further analysis, it emerged that 44% of maritime passenger transport is national, the majority of which concerns Southern Europe harbours. On the contrary, Northern European ports are primarily international seaport. Regarding specifically cruise passenger transport, it revealed to be highly present in Europe, which is the second cruise destination in the world, after the Caribbean. (Source: Quantitative Analysis of Maritime Passenger Transport in Europe)
As far as the Survey is concerned, according to 18% of respondents, quality of water transport in their nation had remained the same over the last five years. 14% said it had improved, and according to 6%, it had deteriorated. However, it is important to note that the majority of the respondents (62%) were unable to answer. Also regarding this transport mode, ticket prices were considered the most serious problem, followed by reduced links and water pollution (both 15%). (Source: Quality of transport)
2.1.3 Transport externalities
As already reported above, the transport sector is responsible for many negative externalities. The most relevant ones, which will be analysed in the following chapter, are:
- Air pollution;
- Congestion and Scarcity;
188.8.131.52 Air Pollution
Air pollution can be defined as the presence of pollutants in the atmosphere at levels that harm human health, the environment and cultural heritage (Source: Explaining Road transport emissions). Transport is by far one of the primary producers of both greenhouse gases and air pollutants, especially in cities and urban areas. Progress made in recent years in technologies have drastically reduced emissions of air pollutants in spite of the increased traffic volume. The rising number of diesel motors and the boom experienced in air and maritime transport have a negative impact in this respect. Transportation currently accounts for roughly one fourth of the total EU human-made GHG emissions. This share is growing, considering that transport is the only EU sector where the GHGs emissions have risen since 1990 (scoring a +20.5% over the 1990-2014 period), regardless of the lessening pattern saw since the 2008 economic crisis and the related reduction in transport demand. Consequent to the economic downturn and the introduction of ever stricter technical standards for vehicles efficiency and fuel quality, GHGs emissions from transport have been diminishing since 2007 (-11.4% from 2007 to 2014), together with the sector’s energy consumption. However, this reversal in trend did not counterbalance the growth registered in the previous years. (Source: Research for TRAN committee – greenhouse gas and air pollutant emissions from EU transport)
A significant advance has been accomplished over the past years in limiting emissions of several pollutants from road traffic. These results come from a blend of strategies and measures, such as the setting technological standards for vehicle emissions and fuel quality, the establishment of air quality limits, an improved transport planning, and the grant of public transport incentives. Emissions generated by road transport are of particular importance, as they usually occur in areas where people live and work. Consequently, although emissions produced by the transport sector may be lower in absolute terms compared to those from other sources, their effects on the population may be much more severe. Because of the significant contribution of road transport to air pollution, already back in 1970, the first European Council Directive established some measures to reduce air pollution generated by motor vehicles. In 1992 the “Euro” emission standards were introduced, starting with the “Euro 1” step, followed by successively stricter benchmarks (today the stricter standard is “Euro 6”). As opposed to GHG emissions, in the past twenty years, outflows of the primary air pollutants from transport have diminished in general terms. In any case, the most recent air quality assessment published by the EEA reveals that over the last few years, a huge portion of the European urban population was exposed to air pollution levels surpassing EU air quality standards. Pollutants emitted from road transport can be split into two groups: those that are regulated under EU road transport legislation and those that (at present) are not.
- CO2 is the most critical GHG impacting climate change, representing a threat to both the environment and public health;
- Carbon monoxide (CO) results from incomplete combustion, and it contributes to the creation of smog and ground-level ozone;
- Hydrocarbons (HCs), are produced from either fragmented or partial combustion and are harmful to human health;
- Particulate matter (PM) derives from incomplete combustion and a complex blend of both primary and secondary PM. “Primary” PM is defined as the fraction emitted directly into the atmosphere, while “secondary” PM is dispersed directly in the atmosphere after the release of precursor gases.
- Nitrogen oxides (NOX) emissions also prompt the formation of “secondary” PM and ground level ozone. It is harmful to the environment because it contributes to the acidification and eutrophication of waters and soils.
- Certain acidifying pollutants, such as NH3 and SO2;
- Certain carcinogenic and toxic organic pollutants, such as polycyclic aromatic hydrocarbons (PAHs), persistent organic pollutants (POPs), dioxins and furans;
- Some heavy metals, such as lead, arsenic, cadmium, copper, chromium, mercury, nickel, selenium and zinc.
Moreover, in the specific, vehicles emissions can be categorized into three groups:
- Exhaust emissions: the outflows derived primarily from the combustion of several oil-based products such as petrol, diesel, natural gas (NG) and liquefied petroleum gas (LPG).
- Abrasion emissions: the discharges from the mechanical abrasion and erosion of vehicle parts. This type of emissions regards some heavy metals and PM emissions.
- Evaporative emissions: the result of vapours deriving from the vehicle’s fuel system.
(Source: Explaining Road transport emissions)
As already mentioned above (see section 2.1.1 Key facts, trends and expectations), severe discrepancies exist between real-world results and test measurements of fuel consumption and pollutant emissions. In particular, ICCT studies revealed that real-world NOx emissions from diesel vehicles were on average seven times above the limits defined by the “Euro 6” standard. To reduce this gap, the EU has recently decided to implement “Real Driving Emissions” test system for NOx emissions from new cars starting in 2017. Given the administrative frameworks and the technological solutions, outflows from the transport system are forecasted to continue their decline across Europe, impacting both the ecosystem and human health positively. About 30% of Europeans living in cities cohabit with air pollutant levels far above EU air quality standards, and 87-90% of them are exposed to atmospheric pollutants levels considered harmful by the World Health Organization. (Source: Towards clean and smart mobility)
Speaking of solutions, electrification of transport and the development of public transportation could remarkably improve air quality in European cities. It has been estimated that the combined effect of GHG decrease and air quality measures could reduce air pollution by more than 65% in 2030 compared to 2005 levels. The annual expense to control traditional air pollutants could diminish by more than € 10 billion in 2030, and in 2050 the annual cost saving could reach € 50 billion. These improvements would likewise reduce mortality, with annual benefits estimated to be around € 17 billion in 2030 and up to € 38 billion in 2050. (Source: A Roadmap for moving to a competitive low carbon economy in 2050)
The amount of traffic injuries and fatalities has decreased enormously in the European Union in the last decade, falling by 37% in all transport modes in the 1999-2010 period. In any case, the social and monetary costs of transport accidents remain extremely elevate, estimated to be the 2% of EU GDP annually. One of the roles of the European Commission is to provide to European citizens agreeable safety and security standards in all modes of transport and to make Europe a global leader in transport safety. To reach this ambitious goal, the European Commission has to implement and enforce uniformly throughout the EU high safety standards. Since the majority of accidents occurs on the road, the policy priority is to reduce road accidents, aiming at cutting by half fatalities by 2020 and reaching the ambitious target of close to zero deaths by 2050.
According to data, traffic accident rates differ significantly between transport modes. Road is the most broadly utilized transport mode, with the noteworthy risk and cost in terms of human life. Around 26,000 people were killed in road accidents in Europe in 2013 alone, and 250,000 people are assessed to be seriously injured in road accidents every year. In 2009, traffic accidents were evaluated to cost EUR 130 billion in medical care, vehicle repair, and police involvement, and additionally in remuneration for loss of economic productivity caused by fatalities and injuries. Road safety differs significantly across the different Member States. The highest number of road fatalities per inhabitants in 2013 was registered in Romania, followed by Latvia and Lithuania, while the lowest number road death rates were reported for Sweden and the United Kingdom.
Rail and ferry accidents are less frequent and cause fewer victims than road accidents. However, these disasters involve a higher quantity of people, cause significant environmental harm, and transport disruption. In 2012, an overall amount of 2,068 serious rail accidents caused about 1,133 fatalities and 1,016 people seriously injured, at a total cost of EUR 1.5 billion.
As far as the maritime sector is concerned, it is characterized by a much lower number of deaths, with just 60 annual fatalities in the EU waters. However, this figure does not take into account the recent phenomenon of migrants arriving in Europe in very little and extremely insecure boats. According to ONU’s estimates, in 2016 alone, in the Mediterranean Sea died more than 5,000 people, and in 2017 at the end of June, the number of victims was already above 2,000. However, the danger of oil spills caused by maritime accidents continues to be a major concern, because more than 85% of crude oil imports to the EU is transported by sea, corresponding to 670 million tonnes every year.
Human factor is one of the primary drivers of accidents in all transport modes. For instance, in the road sector, around 95% of accidents include human error at some level, and 75% are entirely caused by it. In the same manner, around 80% of collisions, groundings, and fire of ships and vessels are ascribed to human error. The challenge in decreasing the driver blunder is to increase comprehension of the contributing causes and their potential impacts. Studies demonstrate that 80-90% of risk factors concerning the driver is linked to health, such as stress, fatigue, and consumption of alcohol, medicine, and illegal drugs. As far as the road sector is concerned, other important factors are the use of mobile phones, not wearing seat belts and excessive speed levels.
Intelligent Transport Systems can assume an essential part in lessening human error. Vehicle and infrastructure design and advancements in technology should be coordinated into a wellbeing framework that assesses human error and inappropriate behaviour to prevent and restrict the outcomes of potential failure. Technology advances in automation in all transport modes have the great potential to lessen the danger of accident and to limit the consequences of human error, yet in addition, they present some new safety challenges. Subsequently, in launching these advances, thought must be given to their potential adverse effects, such as the consequent overconfidence in technology, distraction, cognitive overload, and technical reliability. The challenge is thus to influence road users to embrace safer behaviour while raising awareness of the consequences of unsafe attitudes.
A critical issue in road safety is the protection of vulnerable road users (such as cyclists, motorcyclists, and pedestrians), who generally suffer more severe wounds. In 2012, vulnerable users accounted for around 1/2 of all road death, with 21% of accidents involving pedestrians, 7% involving cyclists and 18% involving motorcyclists. In the EU Member states, pedestrian and cyclist deaths decreased by 5% less compared to car deaths between 2001 and 2009, -34% and -39% respectively. Age-related components are extremely relevant to safety. Nowadays, the over-65 population exceeds 16%, and 4% is over 80, and these percentages are expected to increment to 25% and 8%, respectively in 2040. The Transport White Paper Roadmap sets out attractive security targets of saving thousands of lives. This ambitious objective requires harmonized effort at all levels of government and the coordination of policies and regulations in all Member States. The EU’s job is to provide a reference system, to set common safety standards and a uniform procedure to achieve the highest level of transport security throughout the EU. (Source: Travelling safely in Europe)
Congestion is a major transport issue, in particular on the roads in cities and urban areas. It is a problem that has to be dealt with urgently, because it intensifies the other negative externalities of the transport sector. In fact, in traffic jams, much noise pollution is generated, and a significant amount of exhaust gasses are emitted. The “slow, stop and start” component of congested urban traffic conditions and regular short journeys may result in higher carbon emissions per km compared to the regular free-flowing trips. Congestion may have various origins, but usually it is the result of multiple causes such as bottlenecks and capacity shortages, accidents, adverse or extreme weather conditions, and road works. Congestion can negatively influence the performance and quality of the transport system in many different ways, such as by increasing travel times, by making public transport delayed and thus overcrowded, and by generating reliability problems. (Source: The calculation of external costs)
It is assessed that nearly EUR 100 billion, or around 1 % of the EU’s GDP, are lost to the European economy every year due to traffic congestion. And these costs are expected to increase by about 50 % by 2050. In London, Cologne, Amsterdam, and Brussels, drivers are estimated to spend more than 50 hours a year stuck in traffic jams. According to TomTom’s data, the most congested European cities are Warsaw, Marseille, and Palermo, presenting morning peak congestion levels of 84%, 74%, and 64% respectively. Congestion also impacts well-being, by negatively affecting road users’ stress. It has turned out to be certain that congestion cannot be managed just by adding road capacity. An increasing number of cities are applying incorporated ways to deal with this increasingly serious problem, including measures to create access restrictions, to implement parking standards and pricing policies, and to improve non-motorized facilities and public transport services.
Many European cities have introduced urban congestion charging as measures to manage their levels of traffic jams and congestion. Probably the most relevant examples are London and Stockholm. The pricing system aims at making transport demand more efficient, encouraging mode shift and removing superfluous journeys. Stockholm has diminished its traffic levels by 22 %, reduced congestion (expressed as travel time) by 30–50 %, and lowered its emissions by 12–14 % within the central charging zone. London was able to reduce its traffic levels by 15 %. Moreover, these charges can likewise contribute to investing in ways to generate modal shift. (Source: TERM 2013)
Measures aimed at reducing congestion can be either demand or supply side oriented. Demand for transport is created when the need for travel between an origin and a destination arises. Therefore, demand strongly depends on socio-economic and population factors. On the contrary, the supply-side is mainly influenced by the capacity and the presence of incidents such as accidents or infrastructure works. Importantly, the last two factors can be affected by traffic management approaches, thus meaning that the supply-side of the road network can be optimized by traffic management tools. (Source: Measuring urban traffic congestion, a review) One example of traffic management tools is the Intelligent transport systems (ITS). They can help reducing delivery times and congestion for last-mile distribution thanks to the implementation of real-time traffic management technologies. Moreover, these new technologies can also mitigate air pollution by lessening GHG emissions. In fact, more resource-efficient vehicles and cleaner fuels are probably not going to accomplish without anyone else the fundamental cuts in emissions, and they would not solve the problem of congestion. They should be joined by a greater use of buses and coaches, rail and air transport for passengers, and multimodal solutions relying on waterborne and rail modes for freight. (Source: 2011 Transport White Paper)
It is relatively recent the recognition that noise pollution generates negative effects on life quality and well-being of people. According to a study conducted by World Health Organization (WHO), every year at least one million of healthy life-years are lost in western Europe alone because of the adverse health effects arising from the exposure to excessive noise from road traffic alone.
The principal legislative instrument regulating exposure to noise in the EU is Directive 2002/49/EC, known as the Environmental Noise Directive (END), which refers to the appraisal and administration of the environmental noise. END controls and regulates exposure to outdoor noise by setting two indicators and their relative thresholds. The first one is for day, evening and night-time spans (Lden). It quantifies annoyance, and it must remain underneath the limit of 55 dB. The second indicator is for night-time frames (Lnight). It is designed to assess sleep disturbance, and it cannot be higher than 50 dB. (Source: TERM 2016)
As far as different transport modes are concerned, road traffic is the first one in terms of noise exposure within the European population, with no less than 125 million individuals, corresponding to one in four people, being potentially exposed to levels above the END thresholds Night-time road traffic as well is a primary source of noise exposure, with over 83 million Europeans potentially exposed to harmful levels of noise. These figures are estimated to be among the causes of approximately 10,000 premature deaths per year. Moreover, there are significant gaps in the data reported by the END, thus meaning that the actual impact is likely to be much greater. Railroads are the second-biggest generator of noise. Aircraft noise is probably the most intense form of noise generated by the transport sector, thus its impact on population can be much higher than other sources, but it is extremely limited in space. As a consequence, the number of people exposed to it is much lower compared to other sources of noise. Where comparable, reported data suggest that sound exposure remained moderately stable over the 2007-2012 period. However, data show a general increase in the number of people exposed to noise from airports, a slight increase in those exposed to noise derived from roads, and a small decrease in the number of people exposed to noise generated from railroads. (Source: TERM 2015)
Over past decades, various methodologies have been developed to reduce noise pollution. Noise emissions can be mitigated at source, for example by setting limits for the noise of vehicle engines and exhausts, by promoting the use of quieter tires, and by developing low-noise road surfaces; or by diminishing the exposure of people by anti-propagation means or measures of insulation, such as by expanding the distance between the source of noise and the recipient, through better insulation of buildings or by constructing noise barriers. Most EU regulations focus on reducing noise at source because it resulted to be the most cost-effective way. In fact, it has been concluded that an expenditure of EUR 6 billion in the reduction of vehicle noise emissions would result in 31.5 million fewer people annoyed, whereas the same amount invested in noise barriers would help only 0.2 million people.
Despite being a major problem in cities and urban areas, noise does not affect only human well-being. Large ships and vessels generate significant amounts of noise that, due to its low frequency, propagates extremely far in water and disturbs marine life. Research demonstrates that whales and other species that communicate and orient themselves through sound are particularly affected. (Source: Towards clean and smart mobility)
2.1.4 Transport and the ecosystem
As we have seen throughout the paper, transportation networks, comprising of motorways, roads, railroads, rivers, cycle paths, flight routes and sea routes are fundamental to our society and economy. In fact, they connect people, boost economic activity and provide access to key services. However, they can shape and negatively impact the environment and biodiversity around them. They can represent insurmountable barriers for various animals, their use emits pollutants, and they allow the introduction of non-local species to ecosystems. A way to preserve and protect natural ecosystems and biodiversity is through the implementation of strong policy measures and the formation of green spaces networks.
Transport networks can encourage the spread of urban areas while exerting pressure on natural habitats. Connecting remote locations to the transport system can certainly boost their economic activity, but it often comes with severe negative impacts on the local environment. Deforestation, air and noise pollution and habitat fragmentation are only some of the possible consequences of human expansion in natural areas. Certain pollutants affect tree growth and cause water acidification in lakes. Oil spills or the release of dangerous and harmful substances in the water can cause considerable damage to marine life. Many of these risks have been recognized, and consequently numerous measures have been put in place both at European and international levels.
Noise pollution as well can be harmful to the ecosystem. As mentioned in chapter 184.108.40.206 Noise, the noise generated by large vessels is easily propagated in the water, and it disturbs marine life, mainly the spices that communicate and orient themselves through sound. In addition to pollution, transport can also transfer non-local species into new territories, causing significant harm to local ecosystems. A noteworthy example is the Suez Canal: since its development, more than 500 non-indigenous marine species were introduced to the Mediterranean Sea, causing a catastrophic anthropogenic ecosystem disturbance. In this regard, maritime transport is particularly dangerous: large ships, especially those utilized for cargo transport, take in water so to balance out the vessel. Depending on their cargo load, often they have to add or discharge this so-called ballast water, which may contain several bacteria, larva, and eggs of various animal and plant species. If the quantity introduced is large enough, the alien species may have devastating impacts on the ecosystem. A well-known episode was the case of the comb jellyfish, Mnemiopsis Leidyi, a species local to the American Atlantic coast. It was introduced into the Black Sea through ballast water at the beginning of the 1980s, and it had devastating effects on local marine life.
Transport infrastructures and networks represent a physical barrier for animals and plants and divide the natural landscape into smaller territories. Notwithstanding reducing the total area accessible to wildlife, a lack of connectivity between different habitats makes their populations more vulnerable. Animals need to move around in order to find food and mate, and they risk being harmed while crossing roads and railways. Better connectivity of natural areas would certainly reduce the pressure on Europe’s biodiversity and ecosystems. At this purpose, a ‘green infrastructure’ should be developed. It consists of a strategically planned network of high-quality green spaces. It connects green and natural areas to make safer and facilitate the movement of different species. Better connectivity is not by any means the only positive result of an ecological framework. It is progressively seen as a cost-efficient method of reducing today’s and tomorrow’s weather and climate-related hazards. The EU’s current transport policy has significantly strengthened the consideration given to nature and biodiversity. Now, these concerns have to be taken into account from the very beginning of new projects planning phase, and stricter environmental protection rules have already led to changes in several projects. (Source: Towards clean and smart mobility)
In 2011, the EU developed an ambitious strategy comprehensive of 6 targets and 20 actions in order to stop the loss of biodiversity in the EU by 2020. The six goals are the following ones:
- The full implementation of the EU nature legislation;
- Better protection and restoration of ecosystems and the services they provide, and greater use of green infrastructure;
- More sustainable agriculture and forestry;
- Better management of EU fish stocks and more sustainable fisheries;
- Tighter controls on Invasive Alien Species;
- A greater EU contribution to averting global biodiversity loss.
(Source: The EU biodiversity strategy towards 2020)
The European Commission recently performed a mid-term review of progress under the EU Biodiversity Strategy, in which it expressed that the 2020 biodiversity targets can be accomplished only with a stronger and more ambitious enforcement throughout the Union. At present, biodiversity loss and the degradation of ecosystems are expected to continue at both European and global level. This can be translated into a severe risk for biodiversity not to satisfy human demand in the future. Resulting from the acknowledgment of the negative effects transport has on nature, several EU regulations and strategies have been so to minimize such consequences. The most relevant legislations regulating transport infrastructure projects within this framework are the following ones:
- Trans-European Transport Network – TEN-T: A new directive stipulates that when projects are planned and implemented, Member State should take into consideration also the protection of the environment and biodiversity. They can do this via completing Environmental Impact Assessments (EIAs) of projects, or through other appropriate evaluations.
- EU Nature Directives/Natura 2000: The Natura 2000 system of designated sites tries to guarantee that adequate importance is given to potential effects on the transport infrastructure on the environment. As a consequence, projects not respecting certain environmental standards should not be authorized.
- Water Framework Directive: The Water Framework Directive (2000/60/EC) commits European Union member states to accomplish good qualitative and quantitative status of all water pathways, including marine waters up to one nautical mile from shore.
- Environmental Impact Assessment and Strategic Environmental Assessment: The Environmental Impact Assessment Directive, EIAs (85/337/EEC) outline specific environmental and social effects of a proposed project so to predict potential environmental impacts at an early stage. The Strategic Environmental Assessment Directive, (2001/42/EC) SEAs are used to assess plans and programmes in a previous stage of the decision-making cycle (APFM, 2013). Their goal is to avoid environmental damage or pollution before implementation rather than compensate for these impacts later.
(Source: TERM 2015)
2.2 Focus on the Last-mile
Throughout the paper, it was often mentioned the close connection existing between the transport sector and the economy. Therefore, it would not be difficult to imagine the enormous economic importance of freight traffic. This section will analyse the ever-increasing role played by urban freight transport in the European economic scenario, focusing mainly on the so-called “Last Mile”.
In recent years, increasing attention has been given to the movement of goods between a transport hub and a delivery address, commonly known as the last mile. This is due to two main reasons. The first one is the enormous growth experienced by e-commerce and the consequent increase in home deliveries, especially in cities and urban areas. The second reason is that this last step of the supply chain results to be one of the least efficient parts of the entire transport chain, both from the economic and the environmental points of view. Consequently, public authorities, transportation companies, and retailers have been trying to make this last leg of the supply chain more efficient and sustainable, so to be able to gain from the significant number of opportunities it offers.
2.2.1 Last mile delivery and urban logistics
At present day, around 74% of European population lives in urban areas, and this proportion is projected to increase in the future. Cargo transport has a strategic section for the economic growth of cities and urban areas. It is assuming an increasingly important role within cities, not without any negative consequence, such as traffic congestion, air contamination, noise pollution, and accidents caused by heavy vehicles in the urban traffic. On average, in European cities, freight transport accounts from 8% to 15% of the total traffic flow, but it represents up to 20-30% of total traffic emissions. Urban freight transport is not efficient because of numerous reasons including the high degree of empty runs, a large number of individual deliveries in a given period, and the long stay-times at loading and unloading points. In this context, a fundamental role is played by delivery companies, which account for the majority of urban freight transport. In recent years, the distribution market has become extremely competitive, with major players making substantial investments in technology and innovation, and providing to their clients more delivery options and quality services. In logistics industry, it is evident that the winners in this growing market will be those able to offer flexibility in deliveries, state-of-the-art technology, and efficient return services, always remaining competitive on the price. The advent of e-commerce transformed shopping into a 24/7 experience for many consumers. As a consequence, demand forecasting and meeting customer expectations could be problematic for retailers. For consumers, the service level is extremely relevant: carriers should provide flexible service, based on technology and reflective of a consumer’s preference. However, the majority of e-shoppers remain highly price-sensitive, leading retailers and carriers to fierce competition.
Logistics in urban locations can be enhanced by implementing new organisational frameworks in combination with innovative vehicles. A relevant example could be the utilization of electric vehicles or cargo bikes. Being particularly quiet, they could be used for night deliveries. This way, they would reduce noise pollution, carbon emissions, and road congestion during rush hours. New ways to deal with urban mobility are rising in fact, local authorities are trying to make a shift towards cleaner and more sustainable transport modes. Cities’ characteristics, namely high population density and short-distance journeys, make them the perfect candidates for a transition to low-carbon transport compared to the rest of the transportation system. To change urban mobility, coordinated action by decision makers and competent authorities at all levels of government is needed. More importantly, to be efficiently and broadly deployed, frameworks and tools developed at the European level ought to be adjusted to the specific conditions of every Member State. In fact, an entirely harmonised European approach is not seen as opportune in the light of the fact that it is crucial for the design and implementation of such schemes to be customized to the particular situation in each urban area. Non-binding guidelines would, nonetheless, foster a more conventional approach to certain issues including, for example, road signs and vehicle categories. Dealing with an effective progress towards a more sustainable kind of urban mobility remains a noteworthy challenge for urban areas throughout Europe. Therefore, it is fundamental for urban mobility to remain high on the EU political agenda. (Sources: “The Last Mile: Exploring the online purchasing and delivery journey”, “Last mile freight distribution and transport operators’ need”, “Home Delivery and the Impacts on Urban Freight Transport: A Review”, and “Together towards competitive and resource-efficient urban mobility”)
It would not make sense to talk deeply about last mile delivery in Europe without introducing what makes it so relevant today: e-commerce. E-commerce has revolutionized the retail world, creating new business opportunities and models, new jobs, and different forms of interaction with consumers. With over 821 million of citizens, 73.5% of which use the Internet, the potential for e-commerce in Europe is huge. E-commerce Europe estimated the share of the e-commerce economy in the EU’s GDP to be 2.45%. In 2017, sales from European e-commerce are expected to reach € 602 billion, with the sector continuing to grow at double digits, as reported in the graphs below. (Source: European ecommerce site)
The most important EU markets for the industry are UK, Germany, and France, which together account for 60.2% of e-commerce in Europe. Trends in online shopping are extremely variegated across the Union. The most active e-consumers are in the UK, where 2016 Eurostat data revealed that 87% of the citizen purchased something online in the past 12 months. On the contrary, in Romania, only 18% of the population practiced e-shopping in the previous year (Source: Eurostat website). The continuous growth in e-commerce volumes inevitably led to an outburst of freight traffic, due to deliveries, in residential areas. “In 2013, Copenhagen Economics reported shipments of 6,406 million units in the European Union, 56% of them were B2C (3,614 million units).” (citation by)
A fundamental aspect regarding e-commerce is the delivery of the purchased products, which exercises a significant influence on a consumer’s purchase decision. On its report “Non-binding guidelines for e-commerce”, the EC revealed that delivery and product returns are amongst the top concerns of both e-customers and e-retailers. As a result, delivery has turned out to be increasingly competitive, with consumers demanding for progressively less expensive and quicker services. Due to its intrinsic structure, the last mile is regarded as one of the most expensive steps in the entire supply chain, with costs that may amount between 13% and 75% of the total logistics cost. These high proportions are due to inefficiencies, and poor environmental performance. “The last mile delivery concerns the delivery process from the warehouse or distribution centre to the recipient” [Cit. Sustainability SI: Logistics Cost and Environmental Impact Analyses of Urban Delivery Consolidation Strategies]. There are several obstacles, both policy- and non-policy-related, regarding the improvement of the last mile efficiency regarding logistics cost, energy consumption, and emissions. Vehicle size restriction, for example, is one of the most relevant factors regarding cost increase, since the reduced capacity inevitably leads to a higher number of trips.
2.2.3 Different types of last-mile deliveries
In this chapter, I am going to analyse some of the most common options for the last mile delivery, which comprehend:
- Home delivery (HD);
- On Demand Delivery (ODD);
- Pickup Point (PP);
- Automated Parcel Locker (APL);
- Smart Parcel Box (SPB).
220.127.116.11 Home Delivery (HD)
With the expression “Home Delivery” (HD) are generally meant the direct-to-consumer deliveries, even though they do not necessarily have to be at consumers’ house. Home delivery is a service far from being new, with milk and water deliveries already active in the early twentieth century. However, the technology advancement, and especially the advent of the web, have indeed revolutionized this service. In fact, with the expansion of the internet, many companies started to offer to their customers the possibility to buy products online, and today home delivery has become one of the most competitive tools for many enterprises. However, HD remains extremely inefficient, due to a number of inherent factors. Many aspects have to be considered, such as the security one associated to the “not-at-home” problem that arises when there is nobody at home when the courier arrives. Sometimes the product can be left in the mailbox or to a neighbour, but some other times the addressee has to sign a confirmation of receipt. The majority of the times, this results in high delivery failure and empty trip rates, which inevitably impact substantially on cost, efficiency and environmental performance. In general, the impacts on traffic in urban areas caused by the increasing number of home deliveries is of great interest for the society as a whole. It might be logical to expect that home delivery could prompt more freight traffic but, at the same time, it would decrease people’s shopping trips, leading to an overall decline in the number of trips. In reality, people tend to combine different purchases in a single shopping journey. Therefore, even if purchasing online, many customers still go shopping but purchase less in stores. As a result, it is likely that the total volume of cargo and passenger traffic regarding vehicle-km would not be changed so much by the advent e-commerce.
18.104.22.168 On Demand Delivery (ODD)
On Demand Delivery, ODD is a delivery concept implemented since late 2014 by some start-ups. It is a service by which consumers can order products (it started with the food industry, but soon the service was extended to many other sectors) on the web or using apps on their smartphones or tables, and receive their orders at home, or wherever they are. The products are delivered in a very narrow time-span, that depending on the product may vary between few minutes and a couple of hours, by couriers using the most diverse means of transport. ODD has a great potential for creating a brand-new market, by disrupting the existing one and displacing the available technology. Today, this service is provided both by large well-known companies such as Amazon, with the service Amazon Prime Now and Uber with UberRUSH, and smaller start-ups such as Deliveroo, JustEat and Foodora. ODD organizations supported by their technological platform can account on an extended network of independent delivery couriers performing the deliveries. Technology allows ODD companies to monitor the real-time delivery status, and to check directly with the end customers. This service allows local retailer to offer home deliveries without the need to develop their own technological platforms and logistics solutions. Currently, there are two options for this service:
- Customers choose the retailer, not the ODD company: Customers make their order online from a particular retailer. The delivery is handled by an ODD company in the background. The customer usually does not know which delivery company is handling his order until he receives the message with a trackable link with the delivery updates. Companies such as UberRUSH provide this type of service.
- Customers choose the ODD company, not the retailer: Customers make their order on the app or web page of a particular ODD company. Within the app, consumers can choose from a menu of items that will be delivered to them by the ODD company. This service is provided by companies such as Deliveroo and Foodora.
On Demand Delivery is characterized by the following key features:
- Couriers: Couriers are not ODD employees but independent workers. Depending on the ODD company, people with a means of transport (which can be theirs or provided by the firm) can register and decide when to work.
- Environment: Awareness on environmental issues has increased dramatically in recent years. This has been reflected in the choice of many ODD companies to exclusively use environment-friendly vehicles, such as cargo bicycles, scooters, and electric vehicles.
- Retailers: For retailers, ODD may represent a competitive advantage that many rivals might not be able to match. ODD companies give local retailers the possibility to provide the home delivery service with no significant investment, allowing them to compete with e-commerce giants. Moreover, they can scale more quickly, being able to reach customers who would otherwise be too far away to buy their product.
- Delivery Consolidation: A vast improvement would be given by the possibility to apply the UberPOOL concept to deliveries. UberPOOL allows people to share the ride and the relative cost with someone else taking the same route. This way costs will be much lower, while convenience and reliability will remain the same.
As mentioned above, following the internet explosion, many retailers have started to sell their products online, including some grocery stores, giving birth to the so-called e-groceries. However, reaching and maintaining profitability in the online retailing can be extremely difficult, especially when the specific properties of the products make the selling complicated. Firstly, much grocery needs to be kept chilled or frozen, which makes it harder to be delivered to the customer. Secondly, profit margins in the grocery business are quite small, and numerous online customers are unwilling to pay for the comfort of not having to go to the shop to purchase the products themselves. In addition, grocery products are purchased quite frequently. Consequently, the service provided should be extremely efficient and convenient, because the average shopper would use it quite often. Lastly, two critical aspects are the perishability of grocery products and the delivery of order promised within fixed time window. These and other properties make the online selling of grocery products a challenging task. The UK can be considered the European pioneer of e-grocery, starting to offer this service in supermarkets back in 2000. Soon other European countries entered the fresh food online market. As far as the actors involved in the sector are concerned, small and medium sized food retailer rarely sell their products on the web. If they offer the possibility to purchase online, they are generally supported by third-party service providers. For many consumers, grocery shopping can represent an excellent opportunity to save time in everyday routine. An average purchaser visits a grocery store around 2.2 times a week, while the 82% of the e-customers purchase grocery online instead of going to the grocery store. The difficulties related to changing in clients’ habits, poor logistics, and the existing gap between e-grocers’ costs and customers’ willingness to pay, may explain the low profitability and common failures of e-grocery stores in the 2000s, despite the fact that grocery has turned out to be one of the fastest-growing categories in online sales, with high expectations for the future.
22.214.171.124 Pickup Point (PP)
Pickup Points (PP) is a delivery scheme by which goods purchased online are delivered not to customers’ house, but to a specific location (usually a retail shop or a post office) where they can go and collect them, helped by the store employees. PPs are flexible to store parcels of different shape and sizes, as goods are stored in a storage area in the shop. Customers are generally free to choose the PP from which they would like to collect their product. One of the PPs’ strengths is the flexibility of opening times. In fact, consumers can pick up their parcel during opening hours at the time that most suits them, which eliminates the problem of failed deliveries. As a consequence, the cost for transport providers is much lower compared with (frequently failed) home delivery. Moreover, consumers can also use PPs to return their orders easily. A good practice could be the option to deliver products to a PP after first-time delivery failure. This way carries may save time and fuel, as they do not have to reschedule a second or third delivery to the customer’s home. Moreover, rerouting a failed delivery to a PP also reduces the risk of robbery of the merchandise that generally would have been left unsecured outside the home or conveyed at the neighbours’.
126.96.36.199 Automated Parcel Locker (APL)
Automated Parcel Lockers (APLs) are groups of reception lockers that can be located in various areas, such as apartment blocks, supermarkets, or railway stations. The lockers are equipped with electronic locks and a variable pin code that can be used for various clients. Typically, they are used by only one delivery company. However, in a few cases they can likewise be utilized by diverse organizations. Parcels are delivered to APLs where customers can collect and, if necessary, return them. Customers are notified by a message when their delivery has arrived, and given the box number and location, together with the code to open the box. Customers can choose the APL that best suits their requirements, and once the parcel is delivered, they have three to nine days to collect it. To guarantee security, APLs are usually located in places that can be monitored, such as shopping malls or petrol stations. In addition, some APLs are equipped with video cameras and alarm systems.
APL can be highly convenient to use, since customers do not have the time constraint of the store opening hours, nor do they have to hold up until the store personnel can help them. Furthermore, gathering a parcel from an APL can be done anonymously, since no human interaction is needed. However, this can represent an obstacle for customers in need for help, such as elderly and disabled people.
If located in of appropriate areas, APLs, just like PPs, can reduce traffic congestion and pollutants emissions deriving from urban cargo transport. The APL service started to develop after DHL in Germany implemented a “Packstation” system. Today APLs are being installed by numerous organizations throughout Europe. Implementation and efficient use of APLs need to be supported by the residents of the area, delivery companies, public authorities and the owners of the area where APLs are installed. A correct and efficient location of APLs is a critical factor in determining their successful use. Best locations in cities are the following:
- Local hot spots in residential areas, next to convenience stores, and in neighbourhoods with high population density;
- Busy pedestrian areas in city centres;
- Shopping centres and supermarket car parks;
- Bus, subway, or rail stations;
- Petrol stations.
In 2013 in Poland, under the Green and Sustainable Freight Transport Systems in Cities (GRASS) Project, it was conducted an evaluation of the impact of location on APL efficiency. Five underperforming APLs were relocated to new, better-suited locations, and a 32% growth in deliveries was registered. In addition, a study performed on e-shoppers identified that the three most important factors for using an APL are the price of delivery, the availability and their location. Regarding APL site, the study revealed closeness to home, being on the way to work, and availability of parking space as the most important factors.
188.8.131.52 Smart Parcel Box (SPB)
A Smart Parcel Box (SPB) is a concept similar to APLs, but it is owned and personally used by privates. It is a box installed at a customer’s house. It is a safe system for both parcel delivery and collection. The box is built to resist any weather conditions, vandalism attacks and attempted thefts. It includes an advanced and secure locking system, together with a manual override lock, and it keeps packages safe until the recipient can collect them. It is a solution that can drastically reduce failed home deliveries caused by receivers not being at home. Moreover, it is large enough to receive from 85% to 98% of items purchased on the web. Usually equipped with a scan code technology, it is fully integrated with a smartphone app so that customers can keep track of deliveries and pickups in real time.
2.2.4 Features of logistics policy for last mile deliveries
Last mile deliveries are characterized by some key factors which can determine their success or failure. These key factors are:
- High degree of failed deliveries;
- Delivery time windows;
- Carbon print;
- Delivery Consolidation.
184.108.40.206 High degree of failed deliveries
The boom experienced in e-commerce led to a great increase in home deliveries, and consequently also to the number of failed deliveries. When the consumer is not at home, the courier cannot make the delivery. From that moment on there are several options. The carrier could deliver again to the consumer’s house, he could return the goods to the shipper, or the customer could pick up his goods at the terminal. Whatever the option, it results in additional costs for the shipper. The one just described is a situation far from being rare. In fact, it is estimated that, depending on the product, the average proportion of failed deliveries is between 25% and 30%. In this sense, a good solution to deal with failed first-time home deliveries could be to provide some Pickup Points, generic stores to be used as alternative addresses to receive deliveries. However, it is important to notice that the likelihood of non-delivery due to ‘customer not at home’ highly depends on whether or not the consignee is required to sign for receipt or not. If not, perhaps the goods may be left in the mailbox or to a neighbour. A delivery policy permitting failed HDs to be automatically delivered to the customer’s nearest PPs or APLs would be beneficial to all parties. It would decrease the number of failed deliveries, minimize the courier’s path, and be time-saving for both the carrier and the receiver. In addition, this option would reduce the risk of theft associated with parcels left in the mailbox or to the neighbours.
220.127.116.11 Delivery time windows
Many online retailers, including Amazon, provide to the customers the option to select a particular time window in which to receive their goods. On the one hand, this option tends to lessen the degree of failed deliveries, because receivers tend to be at home at the decided time. On the other hand, this feature is not very attractive because usually it is not provided for free. In fact, for the carrier, delivery time windows represent a constraint, which inevitably leads to higher costs: the courier has to adjust his route to the limitations, and if two parcels have to be delivered at the same time but in two different places, they cannot be carried by the same courier. Boyer, Prud’Homme & Chung studied the various effects of delivery window size and concluded that the longer the window length, the smaller the number of miles per customer. Consequently, the more and tighter delivery windows, the higher the cost.
Returns are an intrinsic part of the e-commerce experience, considered among the most important aspects by the consumers, and consequently by the retailers. Return rates for e-shopping vary a lot depending on the products, but can reach 35% for clothing and accessories. While many e-retailers offer a free return policy with some restrictions, for them the cost of taking back a product from the customer is far from being null. Like failed deliveries, returns mean extra trips, and additional sorting to deliver the items upstream in the supply chain.
A frequent problem for online retailers is lack of critical mass in a given region. If a courier has to collect or deliver a single parcel in a very far and isolated area, efficiency will be sharply reduced and cost substantially increased, because of the empty mileage involved. However, the delivery’s population density usually does not affect the price.
18.104.22.168 Carbon footprint
In recent years, consumers have become increasingly environmentally conscious. Consequently, when purchasing products or services, they often look for companies applying environmentally friendly methods. However, most of the times, their willingness to pay a premium price for environmentally sound delivery methods is small or virtually non-existent, and usually they are not willing to accept longer service times in exchange for greener delivery. However, the number of distribution companies that utilize alternative means of transport (such as bikes and electric vehicles) to reduce noise and emissions is drastically increasing.
22.214.171.124 Delivery Consolidation
Delivery consolidation consists in having the possibility to deliver a large shipment within a single delivery. Obviously, consolidation is a great option for sustainability. It means fewer trips by the couriers, and thus lower emissions and costs. Usually, when purchasing online, people tend to buy single or few items, which imply many trips and/or more stops per tour. Therefore, B2C e-commerce rarely takes advantage of the consolidation factor. In this sense, solutions like PPs can provide some degree of consolidation.
3. Possible Solutions
Unlike what people could think in the past, today it is evident that the urgent need to change things is not only driven by social and environmental aspects. On the contrary, economic data is clearer than ever: the massive and widespread inefficiency that characterizes European transport represents an enormous cost to the entire society. The present situation is not sustainable in the broadest sense of the word:
It is not sustainable from an environmental point of view: transport is one of the principal sources of pollution. It contaminates the air we breathe, it poisons the waters where millions of species can no longer live, it destroys ecosystems, and it contributes enormously to the climate change effects.
Transport is not sustainable from a social perspective: with its noise and carbon emissions, it deteriorates people’s quality of life, making the cities they live in unhealthy and unsafe.
The sector is not sustainable economically speaking: empty runs, oil spills, accidents and traffic congestions represent only a minimal part of the tremendous cost that this sector has, which accounts for continuously increasing percentage of the European GDP.
From the previous chapters, it clearly emerges that there is still a lot of work to be done to improve the transport sector, and specifically the last mile delivery. The new awareness of the adverse impact that humans have on the environment and climate change, along with the ever-evolving technologies, are the means to make a turning point in this highly unsustainable situation: today we have not only recognized that we must act to change the situation, but we also start to have the appropriate means to do so.
An inspiring and reassuring example is the huge number of projects and initiatives, born especially in recent years, whose main scope is enhancing transport efficiency and sustainability.
In this regard, I am going to analyse four out of the numerous projects funded by the European Commission whose aim is to provide a feasible solution to urban logistics and last-mile delivery problems. I have selected the following four projects (BuyZET, Co-Gistics, Frevue, and U-Turn) because, among the ones I had the chance to analyse during my three-months internship programme at the European Commission’s Directorate-General for Mobility and Transport (DG MOVE), they are the ones that fascinated me the most, and that I find closer to the topics analysed in this work.
The BuyZET project was launched in November 2016 and will terminate in April 2019. It was funded by the European Commission under the HORIZON2020 Framework Program, and it directly involves five countries, namely Belgium, Denmark, Netherlands, Norway, and the United Kingdom. The project consists of/in a partnership of cities whose goal is to achieve zero emission in urban delivery. The three core cities involved in the project are, Copenhagen, Oslo, and Rotterdam, but Brussels and Southampton are participating as “Observer cities”, meaning that they will jointly engage with the project activities and will be encouraged to carry out the same activities, should they result to be effective.
BuyZET aims to understand and optimise the impact of public procurement activities on transport patterns in cities, and to find innovative and sustainable delivery solutions for goods and services. To do so, the project is studying the transportation footprint of different procurements, and developing innovative procurement plans in order to:
- Increment the demand for zero emission vehicles (ZEV) on the European market;
- Provide sustainable and replicable solutions by turning into a reference in Europe for transportation impact measurement;
- Develop procurement plans so to achieve zero emission in urban delivery for the public sector;
- Improve the quality of by minimizing the use of a motorized vehicle and maximizing the use of ZED life in European cities.
The project tries to fulfill its objective through a two-step approach
Step 1 – Identifying the transportation footprint of our procurement: each city has to analyze the transportation footprint of various procurement activities, which are divided into three categories depending on the service provided and the ownership: (1) city-owned fleet, such as office cars and garbage trucks; (2) purchased transport services, such as bus, metro and tram services; (3) delivery made by contracted suppliers. Each city will then have to identify two priority procurement areas to deal with through the project.
Step 2 – Developing innovative procurement plans: each city will investigate a potential innovative solution for each procurement focus area by:
- Setting consistent communication with the relevant stakeholders of the selected procurement areas;
- Collaborating with other cities, by launching joint procurement actions;
- Analysing best practices throughout Europe.
Co-Gistics, Cooperative logistics for sustainable mobility of goods, is a project funded by the European Commission under the Competitiveness and Innovation Framework Programme (CIP). It started in January 2014, and it finished in March 2017. The main scope of the project is to increase energy efficiency, lower carbon emissions and enhance road safety and cargo security in urban freight transport. In order to fulfil its goal, Co-Gistics has developed five cooperative intelligent transport services, namely Intelligent Truck Parking and Deliver Areas Management, Cargo Transport Optimisation, CO2 Footprint Monitoring and Estimation, Priority and Speed Advice, and Eco-drive Support, that were (and will continue to be) applied to transport and logistics in seven European pilot cities (Arad, Bilbao, Bordeaux, Frankfurt, Thessaloniki and Trieste). The primary stakeholders of the projects are local authorities, users (including truck and van drivers, shippers and fleet operators), harbor, airports, and carrier companies.
In detail, the service provided are the following ones:
Intelligent Truck Parking and Deliver Areas Management: The service provides parking availability information to truck and van drivers, so to optimize parking allocation. It provides efficient management of cargo vehicles traffic volume, which results to be particularly useful during peak hours. The key users of the service are fleet operators, truck drivers, and intermodal terminal operators.
Cargo transport optimization: This service aims at increasing delivery performances, by minimizing the relative costs, time and resources used. This can be done thanks to the provision of real-time information on positioning, traffic, weather conditions, and delays for different transport modes. The service allows logistics operators to optimize their work. Cargo Transport Optimisation enables remote truck accreditation in various logistics hubs, allowing them to get in (or out) the logistics hub based on the automated information of their registration number, thus in a much more rapid and efficient way.
CO2 Footprint Monitoring and Estimation: This service provides post-trip benefits. It measures and gives estimates of the vehicle’s carbon emission levels, using a single horizontally integrated platform, so to reduce the environmental impact. Usually, the most relevant factor for CO2 emissions is the load of a vehicle, together with driving behaviour, road characteristics and engine characteristics. The key stakeholders, in this case, are decision makers and fleet managers.
Priority and speed advice: The service aims at reducing acceleration vehicles have to make during journeys, thus cutting fuel consumption and the relative carbon emissions, especially in urban areas. Drivers are given information about the optimal speed to maintain in order to reach their destination in due-time (macro-level) while minimizing fuel consumption and the number of stops they have to make, thanks to the integration with the traffic-lights systems (micro-level) and real-time traffic.
Eco-drive support: This service encourages drivers to embrace a driving style that is energy efficient, so to limit their carbon emissions and fuel consumption. The service provides pre- on- and post-trip advice, working in two ways:
- The Low Carbon Mobility Management (LCMM) App shows the drivers the amount of fuel they consume.
- Drivers are informed about the time to red or green light at intersections so that they can adjust their speed consequently.
The main advantage of the service is that it allows drivers to identify and implement better driving behaviours.
The main strengths of the Co-Gistics projects are its flexibility and replicability. However, its future is based on the success of the services implemented in the different pilot cities, and on the project’s reference harmonised architecture.
The European Commission funded the Frevue project under the FP7 framework. It is a 4.5 years venture that will end in mid-September 2017. It aims to demonstrate that electric freight vehicles (EFVs) can provide relevant and feasible decarbonisation of the European transport system, especially when combined with urban logistics applications, innovative logistics management software, and well-designed local policy. The overall objective of the project is to make a proof based on European best practice which will support future utilization of EFV by private logistics operators and legitimise policy interventions to promote their use for urban deliveries. The main stakeholders of the project include freight operators and fleet managers, public authorities, energy network operators, vehicle manufacturers, and service providers. The project started in March 2013 in eight major European cities (Amsterdam, Lisbon, London, Madrid, Milan, Oslo, Rotterdam, and Stockholm) where over 80 EFVs have been exposed to the urban logistics environment. Despite its great potential and the strong policy support, EFVs use in the logistics sector has been restricted by numerous barriers, including high investment costs, charging constraints, and range, payload and volume limitations. The project has answered to these challenges by:
- Bringing together well-functioning PPPs (public-private-partnerships) between the involved municipalities and the freight and logistics sector.
- Presenting proof of EFVs’ everyday reliability and suitability across an extensive variety of city layouts, climatic conditions, logistics chains, organisations, charging modes, electricity networks, and diverse political and regulatory settings.
- Distributing the project best practice examples, lessons learnt and key recommendations, so to promote the further take off of innovative city logistics solutions with EFVs as the main actors.
- Designing and implementing a vigorous and well-structured evaluation framework to guarantee the analysis of data on a standard and pan-European basis.
The FREVUE project is soon coming to an end, and the results it has provided are extremely positive, confirming the significant environmental benefits of EFVs. The use of 105 EFVs led to overall savings of up to 2,000 kg for NOx and 70 kg for PM10. Regarding CO2 emissions, they were sharply reduced, with drops between 176 and 190 tonnes of CO2e, representing 45% savings at the general level. The environmental benefits translate into significant cost reductions: NOx reductions generated €995 million of savings, while CO2 reductions generated €15 million. However, significant variations can be observed between different operators and cities. In facts, the eight cities have highly diverse climates and topographies, together with various political and administrative settings. Moreover, each of the Frevue demonstrators was unique in the types of vehicles used, a variety of goods delivered and the tested logistics models.
Frevue has demonstrated the success of EFVs utilization in city logistics operations across more than 15 organizations, adopting the most differentiated vehicles (from small vans of 3.5 tonnes up to hefty 18 tonnes full electric trucks), and gathering information for more than 757,000 km. The Frevue results demonstrate that EFVs are appropriate for urban freight, with the range of vehicles available on the market sufficient to conduct most operations. Throughout the project, it was registered a substantial shift in both drivers and fleet managers’ attitudes: the longer the utilization of EFVs, the more confident and positive they are towards adjusting to vehicles’ requirement. In addition, the maintenance of EFVs came out to be more straightforward than for internal combustion engines (ICEs), and most of the FREVUE vehicles have ended up being extremely reliable. Most operators charge their vehicles overnight at their charging station, but people can also charge during the day if and when they need it. Sometimes, when large fleets are charged at the depot, the local electricity supply may be insufficient. A lesson learnt from the project is that it is essential to collaborate with the distribution network operator (DNO) to find possible constraints and solutions.
Frevue will promote the diffusion of the project’s result through campaigns aimed at professionals in the sector. In order to do so, the project has created a network of “Phase 2” cities to directly share the lessons learned from the eight pilot cities, and expand the successful concepts. In doing this, Frevue takes a crucial step towards achieving CO2-free urban logistics in the main cities by 2030 and improving air quality in European urban areas.
The U-Turn project aims at identifying new models for urban delivery, specifically for the food sector. It was funded under the HORIZON2020 framework, and it involves five countries, namely Germany, Greece, Italy, Luxemburg, and the United Kingdom. The project started in June 2015 and will end in June 2018. U-Turn is created to add to our understanding of freight distribution in urban areas, dealing with the specific requirements of food delivery. It is going to develop and propose innovative business models from a new focused toolkit to attain more efficient operations, both from an environmental and an economic point of view. By analysing today’s urban cargo and determining synergies which might be exploited by logistics sharing and collaboration strategies, practical choices for operators and communities will be provided by the project. These will develop through three principal features (1) comparative analysis based on actual business info, (2) simulation assessment and also (3) pilot execution in 4 different countries: Greece, UK, Italy, and Germany.
U-Turn is going to demonstrate the economic and societal potential through benefit quantification, as well as evaluate the obstacles to adoption. The outputs will comprehend a “smart” transport matching application which will run on a collaboration wedge, a simulation application plus an economic assessment design to evaluate the base situation with the prediction outcomes. In order to do so, the project will:
- Study current delivery of food products in urban areas, selecting data from representative cities such as London, Milan, Athens, Frankfurt, Berlin, along with other urban areas across Europe.
- Identify opportunities for consolidating transportation flows in this and then define alternative logistics and collaboration practices pooling strategies with the aim to improve the environmental situation and reduce transportation costs.
- Measure the effect of the identified strategies and practices, through comparison analysis, financial assessment, and simulation testing, as well as evaluate substitute policies based on Key Performance Indicators (KPIs) handling adverse economic, environmental and social effects.
- Design and implement a simulation tool to measure the impact of alternative logistics sharing options from cost efficiency, effectiveness (service level) along with environmentally friendly perspective.
- Design and implement a collaboration platform to promote the exchange of information and create the appropriate logistics sharing partnerships between food companies and outlet retailers, based on their transportation needs.
- Conduct pilots implementing relevant collaborative proposals in training (real-life scenarios) to exhibit the applicability, the value and the usefulness of the proposed initiative.
- Suggest a roadmap to help organisations prepare collaborative transport functions towards a greener and more efficient food logistics.
The project will implement three pilots
Pilot 1: increasing transport efficiency in Athens
Increasingly new practical ways of purchasing food and beverage have been developed, leading to a rise in urban freight transport activity. While businesses have been involved in collaborative strategies projects, there needs to be a change in the degree of cooperation between operators of the sector. The emphasis of this pilot is to recognize opportunities for synergies as well as assess the effect of collaborative strategies for food producers distributing their products in cities and urban areas, with the goal of eliminating unnecessary vehicle trips.
Pilot 2: Improving the distribution of fresh food from local producers into Milan
The food retail business is experiencing a change in consumer behavior, with an increase in demand for locally produced food, accelerated by the growing trend of e-commerce and same-day deliveries. For numerous reasons, Italy is one of the most fascinating countries for both studying these changes and experimenting innovative collaborative supply chain strategies. Not only are there regional differences in farming and agricultural products, but numerous retailers are dealing exclusively with products produced close to the selling site. The general scope of this pilot is to optimise the local transport flow of goods as well as create logistics schemes for regional retailers and producers. The partners in Italy will be working with a team of farmers located in the Milan area, so to build sales channels, temperature range, and distribution paths.
Pilot 3: Increasing last mile transport efficiency in London
The food retailing market is experiencing fast growth with an increasing number of customers purchasing online. This pilot aims to determine the scope as well as the scale of the home delivery industry for food and grocery products in London. The pilot is looking for new food logistics solutions such as collaborative initiatives in conventional home delivery supply chains, together with the opportunities for new fulfillment models. In-depth analyses are performed to set the general industry size and service profiles for the London area. Using this data, the partners can model and assess the effects of collaborative strategies for food merchants in London.
 Sources: “Logistics Schemes for E-Commerce Technical report Non-binding guidance documents on Urban Logistics N° 4 / 6” and “Logistics schemes for E-commerce Non-binding guidance documents on urban logistics N° 4 / 6”
 Source: Directorate General for internal policies. (2015). Research for TRAN committee – greenhouse gas and air pollutant emissions from EU transport.
 That is 1.17 billion tonnes of CO2 equivalent. Transport is second only to Energy industries, representing the 29.2% of total GHG emissions, and producing 1.41 billion tonnes of CO2 equivalent in 2012.
 Source: Towards clean and smart mobility and Evaluating 15 years of transport
 The 15 Member States of the European Union before the 2004 enlargement: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, and United Kingdom.
 Nitrogen Oxide
 Particulate Matter
 the TEN-T is a planned set of road, rail, air and water transport networks in the European Union.
 Survey conducted by TNS Opinion & Social network on behalf of the Directorate-General for Mobility and Transport in October 2014. See section 126.96.36.199 Road.
 The 13 Member States which joined the European Union since 2004: the 13 countries which have joined since 2004—Bulgaria, Croatia, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia, and Slovenia.
 See note 16.
 See note 16.
 Eurostat, 2011
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