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Staying on track with sustainability

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Robin Woodbridge, Head of Capital Deployment at Prologis UK, explores how rail freight could help the sector deliver a cleaner, greener future for everyone.

200113_Prologis_potraits_1023_robin_woodbridge.jpgRecently, the Chartered Institute of Logistics and Transport said it believed the sector could achieve net zero by 2050 through a series of measures recommended to government and others in its latest report: Routes to Net Zero 2025 (2020 Year End Summary). It is an interesting report which acknowledges the complexities involved in reducing transport-related carbon across the sector: it also cites modal shift as one of the earliest changes which could be made to reduce carbon emissions and using rail, instead of road, for freight is one of the examples given.

During the pandemic, alongside its normal levels of activity, rail freight has run longer trains and carried new flows of PPE and other essentials items to ensure demand is met. It is a sustainable and efficient link in the supply chain that’s often overlooked due to misconceptions around cost and reliability; however, it could help the sector meet ambitious carbon reduction targets.

In the minds of many, both in the logistics sector and wider public consciousness, rail freight is still associated with dusty, dirty coal trains, which were formerly a familiar sight on the UK’s railways. However, that couldn’t be further from the truth. Today’s freight trains are used to move a wide variety of goods the length and breadth of the country, including flatpack furniture, perishable grocery items, building materials, automotive components and parcels.

One of rail’s key strengths is its ability to move many hundreds of tonnes of freight in a single train load, making it an obvious option for high-volume materials going from one rail-connected location to another. Already widely used by large supermarkets, manufacturers and shipping companies to move bulk items to key distribution points across the UK, rail freight is also a surprisingly accessible means of transportation for smaller companies who can choose to move single container loads or explore sharing loads with another company. Not only can this help to achieve cost savings and drive efficiencies, it can also help to answer some of the other challenges facing logistics businesses.

Reducing costs and carbon through collaboration

Ambitious carbon reduction targets are putting companies under pressure to create environmentally friendly supply chains from end to end. As every tonne carried by rail instead of road reduces carbon dioxide emissions by 76 per cent, it’s easy to see why rail freight is gaining popularity in the race to build cleaner, greener supply chains. It’s also encouraging businesses to collaborate to deliver a better future for everyone.

Rail freight users on Prologis DIRFT in Rugby, for example, become part of a rail freight working group who exchange ideas, share best practice and collaborate to reduce both operational costs and carbon emissions. Tesco and Sainsburys, both located on the logistics park, regularly collaborate to share space on the freight trains passing through DIRFT, helping them reduce both their costs and the environmental impact of their operations.

Tesco is now the biggest retail user of rail in the UK and is so convinced of its benefits that it recently launched a new £5m investment programme at Prologis DIRFT to support its plans to transfer a greater proportion of its distribution network away from road and on to the rail network. 

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Tesco’s increased rail service is set to replace 40 truck-loads of road freight between Daventry and Middlesbrough per day. It will eventually save more than 5,000 tonnes of CO2 each year and remove over 3.9 million truck miles from the road, helping Tesco meet its ambitious carbon reduction targets

According to Department of Transport figures quoted within the CILT report, rail freight contributed just 0.3% to overall transport emissions in 2018 and 2019 with HGV,s and vans contributing 17% and 16% respectively. Whilst moving goods by road remains the most popular mode of freight transportation in the UK, rail freight is poised to play a much bigger role in coming years. Currently, 95% of rail freight mileage is diesel; however, if a rolling programme of rail electrification if introduced, this will bring further environmental gains.

Recent research shows that the volume of freight moved by rail in the UK is set to grow by 3% year-on-year. Even before the pandemic, Network Rail forecasts from 2013 predicted that the UK’s intermodal freight sector would grow exponentially, with rail’s share of the road and rail market increasing from 19% to 46% by 2043. This is likely to increase as networks in the UK and EU become even more far-reaching and comprehensive.

Whilst the UK has a well-established national rail network, it is important to ensure key logistics infrastructure is located in areas of the country that benefit from good access, close to major transport hubs. Situated in the logistics ‘golden triangle’, DIRFT is close to the M1 motorway and has a direct connection to the Northampton loop of the West Coast Main Line, providing rail access to the South East ports, and up the spine of the country to Scotland. Delivery drivers leaving DIRFT can reach 95% of the country in under four-and-a-half hours, the maximum time they can legally drive without taking a break. Importantly, the site’s been designed to act as a regional hub for rail freight flows to and from the port of Felixstowe and the Channel Tunnel, which is a key part of the Trans-European Combined Freight Network.

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Developed by Prologis, DIRFT is the UK’s most important intermodal logistics park with three operational rail terminals, alongside rail-served warehousing – which will provide 14million square feet of logistics space, once complete. Over the past decade, rail freight services using DIRFT’s terminals have increased steadily and today, the equivalent of over 200,000 containers arrive and leave the site every year. In addition to domestic services, the common user terminal operated by Malcolm Rail also handles European trains, which continue to operate well, despite recent border changes.  

In an industry that relies on punctuality, rail freight is also an excellent performer in terms of reliability and in Q2 2020, during the height of the pandemic, the proportion of freight trains arriving within 15 minutes of their scheduled arrival time, according to the Freight Delivery Metric, reached a high of 95.4%, according to official ORR statistics. If comparison could be made to road performance, consider how many times you experience significant disruption on the motorway or other trunk roads, delaying your journey, or forcing you to leave early to ensure you reach your destination on time.

For example, a full load order placed at 14.00 in Glasgow can be picked and packed at DIRFT and delivered back to the regional hub or store in Glasgow by rail, arriving at 06.00 representing an order-to-delivery window of less than 18 hours.

As our sector starts to build back better from the pandemic we need to explore and employ a range of measures to ensure we are building truly sustainable and resilient supply chains. This means we need to look at everything: from the sustainability credentials of the buildings that store the goods, right through to the modal shifts that could be made to reduce transport related carbon.

If the sector wants to stay on track with its net zero ambitions, rail freight should certainly be explored as part of the solution.

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