Category Archives: Logistics

Building on the idea that maritime and rail generate less carbon than trucks, the blueprint for decarbonization suggests shifting transport to those means.

That’s easier said than done. The EU has been working hard for some years on a modal shift to river and rail transport for cargo inside Europe. They have actually had some success— a few percent improvement.

But the geography of the EU is a lot more conducive to waterborne transport of cargoes. There there are quite a few navigable rivers going inland from the coast where the ports are. Many EU ports have set up ‘inland ports’, large distribution areas inland that often can be reached by barge, to offload container cargoes and get them ready for distribution. This foresighted policy offers many advantages, both from an ESG standpoint, and for reducing congestion at the ocean ports. But the US has only one large river, the Mississippi, navigable for a long distance into the heartland, in a land mass much larger. Smaller rivers on the East Coast don’t go as far.

However, particularly on the Mississippi, there is a lot of potential for more barge traffic. I also suspect that maritime transport could be used along the coasts for some kinds of moves, particularly movements of products like refinery outputs, that might travel by truck otherwise.

So there is rail. The EU has a problem with rail; most rail is state-owned, and is oriented around passenger travel, not freight. And rail lines in Europe are not all compatible; not only are their practices disparate, but the physical equipment isn’t even compatible at some borders. That adds transfer delays as well as simple handling delays to transport. The EU will have a much harder and more costly time increasing rail cargo percentages.

In the US, we have seven Class I rail firms, all private, that crisscross the country and offer cargo service. Rail can provide the backbone of distribution from ports to the hinterland. But will it? Rail firms are all private, not public; they are currently focused on their most profitable segments, and have engaged in rampant cost-cutting. Sometimes, it’s referred to as PSR (precision scheduled railroading), but quite often it is more closely allied with old-fashioned cuts driven by short-term accounting. The recent reductions in staffing are claimed to result from PSR, but in fact, simply serve to reduce operating costs and improve operating ratios. They may result in reduced safety, as some of the claims in front of the STB put forward. And the popular step of running really long trains to save labor costs reduces flexibility and adjustability of rail traffic to support less predictable loads. These moves by private firms greatly increase the complexity of carrying out the proposed modal shift in the US.

But certainly a modal shift will reduce carbon output. And there is actually a lot that a government push could accomplish. Some of these things are:

• Infrastructure improvements for inland maritime operations;
• Streamlining projects for on-dock rail at ports large and small;
• Inducing rail lines to improve their rail yards and lines to support a more flexible cargo mix and customer set;
• Driving rail common carrier rules that will induce or force rail lines to accommodate cargoes from a broader set of customers, even though the traffic will not be as profitable as long steady coal or grain trains.
• Keeping pressure on the rail lines to serve a broad base of customers, particularly intermodal (container on flat car or trailer on flat car). A move to transport this type of cargo long distances to inland container terminals would help with emissions and get trucks off the major interstates.
• Supporting inland terminals and distribution points that are rail connected.

There are probably more, and Pete Buttigieg and the President’s commission on supply chain probably are thinking of them.

The biggest problem is how to get private industry and investors on board to finance and support the projects.

US National Blueprint for Decarbonization

John Gallagher·Tuesday, January 10, 2023

Biden climate blueprint promotes modal shift away from trucks – FreightWaves