Think transport | Think energy The Green · PDF file5/2014 ! BTJ Think Tank! 2 T Project part-financed by the European Union (European Regional Development Fund) Project part-financed

5/2014 ! BTJ Think Tank ! 1Towards an integrated transportsystem in the Baltic Sea region

Project part-financedby the European Union(European Regional Development Fund)


2

Bodø

Hell Trondheim Ånge

Hallsberg

Gdynia

Karlskrona

Mo / Mosjøen

Tromsø

Lødingen

Alvesta

Kongsvinger

№ 5/2014 (5), 30 SEPTEMBER

The Green VisionBy Przemysław Myszka

The idea of establishing an eco-friendly and efficient corridor for transporting seafood, industrial minerals as well as other goods between the north of Scandinavia and continental Europe has been on the agenda for many years. Today, the possibility of making this concept come true is perhaps closer than ever.

R ail is the solution when one thinks about a greener alternative to road haulage. The ‘ACE Green’ project is all about setting up a new and direct intermodal service, linking the northern parts of Norway (the

Port of Bodø) via south-east Sweden (harbour in Karlsk-rona) to the north of Poland (Gdynia seaport), not only for the extensive Norwegian salmon industry, but also for others willing to facilitate their trades thanks to rails.

The service in question is meant to become a vi-able competition in terms of lead times, reliability and service quality for the up-to-date prevailing truck car-riages. In addition, the ‘environmentally-friendly’ tag of rail transports isn’t without meaning for many car-go owners and shippers in Scandinavia, giving thus railroads a better marketing image over fumy lorries.

However, in order to realise this unique oppor-tunity, a higher level of cooperation among com-mercial transport operators and decision-makers must take place. One of the main goals of the ‘ACE Green’ initiative is to involve relevant stakeholders to a much higher degree. This is to be done mainly by reducing the economic risk for logistics companies and their customers during the corridor’s start-up phase, when problems can occur by not putting enough cargo on the rails.

Therefore, the project wants to bring to life a cor-ridor management organisation, which will oversee the as swift as possible set-up of a robust logistics chain all the way from Norway via Sweden to Poland. The or-ganisation, owned and run by forwarders and terminal operators, will feature a fixed-price terminal-to-terminal system for containers and semitrailers. Though com-mercial in nature, the corridor management organisation

T h i n k t r a n s p o r t | T h i n k e n e r g y

ACE GreenThe Arctic-

-Central European Green Transport Corridor

The ‘ACE Green’ project is about set-

ting up a new and direct intermodal service, link-ing the northern parts of

Norway via south-east Sweden to the north

of Poland.

“




3«Mediterranean / Middle East

Bodø

Karlskrona

Gdynia

Hell / Trondheim

Orebro / Hallsberg

Kirkenes

may require public support (both on regional & national levels) during its early days to grow strong and afterwards carry out the busi-ness on its own.

The potential of the ‘ACE Green’ corridor goes far beyond Nor-way-Sweden-Poland as further links can be established. North-wards, the route can stretch from Bodø to Kirkenes from where Asian markets can be reached due to the more and more ice-free ‘Northern Sea Passage’. Looking to the south, the ‘Baltic-Adriatic Corridor’ starts in Gdynia with a regular rail connection from the Polish seaport to the harbour in Koper, Slovenia. Combined together, these routes form the ‘Arctic-to-Adriatic Cor-ridor’ (A2A), making it possible to ship freight on rail almost along the whole connection, with the Gdynia-Karlskrona ferry as a sound seaborne link between the North and the South in the very middle of the A2A.

The ‘ACE Green’ project is open to anyone who can contribute to its realisation. Through numerous seminars and undertakings, this initiative will make its way into re-ality step-by-step. Hopefully, the first train will soon depart from Bodø to Gdynia, bringing new quality into the logistics world. !

The Polish and South-European freight bound for Scandinavia is usually carried by road, mainly via Germany

and Denmark. The truck traffic is well devel-oped on this route. Vehicles are available and seek employment, offering fast transit and a considerable degree of flexibility. But the long-distance motor transport is expensive and annoying for everyone. It overcrowds European motorways and agglomerations, produces noise and much pollution and de-stroys the environment. Hence, the European Union’s and individual states’ efforts aimed at the road traffic reduction.The Intermodal Green Transport Corridor connecting the Arctic to Central and Southern Europe eliminates the long-distance road transport and may become an optimum solution. However, to attract the freight carried by traditional roads it has to

Piotr FrąckowiakIntermodal Manager BCT – Baltic Container Terminal Gdynia

meet a number of requirements. Integration and co-ordination of all elements of the intermodal

transport chain is the key. Today, customers wish to be offered a complete logistic solution provided

by one partner. This is a great challenge for operators and carriers throughout the chain. Only close co-operation

between the stakeholders, a shared vision and goal, a synergized win-win approach will yield competitive intermodal products capa-ble of redirecting the freights and livening up the corridor.

Today, cus-tomers wish to be

offered a complete lo-gistic solution provided by one partner. This is a great challenge for op-

erators and carriers throughout the

chain.

“

One of the main goals of the ‘ACE Green’

initiative is to involve relevant stakeholders by

reducing the economic risk for logistics companies and

their customers during the corridor’s start-

up phase.

“

Phot

o: BC

T




forwarders and logistics operators to offer a reliable transport service to customers. Already operation-al regular rail links from Western Europe to/from Eastern states of the EU have proven that such cor-ridors are working and could be the future of European transport.

C.Hartwig Gdynia finds the idea of estab-lishing ACE Green very interesting and po-tentially fruitful for the current and future parties involved. This corridor could hope-fully help the transport from Northern Scan-

dinavia to Central Europe and further to be not only cost-efficient and time-saving, but also environmentally-friendly.We are very impressed by the amount of work and results already achieved by the team which is in charge of the project. But there are still things to be discussed. In order to attract more northbound cargo the proposed by Ace Green freight prices, transit times must be competitive to the ones offered by truckers. Multiple transport/equipment options must be on offer, container, trailer and part load shipments possible. Co-operation with forwarders/transport companies situated on the rail path of the project will be essential to finalize the delivery of cargo.The TransBaltic Extension, ACE Green, along with other such pro-jects focused on improving transport corridors are one way for

Piotr SzczęsnowiczScandinavian Department, C.Hartwig Gdynia S.A.

In order to attract more northbound

cargo the proposed by Ace Green freight prices,

transit times must be competitive to the

ones offered by truckers.

“

!What is necessary in order to make the service in question attractive enough for IKEA to use it?

IKEA is one of the main exporters from Poland to Scandinavian coun-tries; last year we delivered over 25,000 full truckloads of furniture. For our business, due to the scale and large share of just-in-time deliveries, it is important to get frequent departures of trains from

Roads are becoming crowded,

drivers are in shortage year after year. The inter-

modal solution opens new opportunities for the in-dustry, with new capaci-

ties and stability in operations.

“

Marcin BarankiewiczTransport Business Development ManagerIKEA Transport & Services – North Europe

terminals and vessels from the ports and high operational precision. The minimum levels required are 2-3 departures per week to keep the lead time stable during this period. It is possible to accept in-creased lead times vs. road transportation, but it has to be stable

and predictable. The transport solution should be available and reliable all year round. Of course, the cost level needs to be

competitive to road, therefore it is important that the intermodal terminals are located close to the start-

ing points as well as destinations. In our case we have the production business located around Poznań, Gdynia and Wroclaw; therefore, the terminals in these areas are crucial for putting our volumes in the designed corridor. On the receiving side, terminals in key industrial re-gions are needed, just to mention Oslo, Malmö,

Gothenburg, Stockholm and Helsinki.

!How can projects like TB Ex contribute to transport and logistics companies’ business operations?

Roads are becoming crowded, drivers are in shortage year after year. It is clear that the growth in volumes cannot be handled by conventional solutions – road trucking or rail in wagons. The intermodal solution opens new opportunities for the industry, with new capacities and stability in operations. Green intermodal trans-port supports the ambitions we have of getting more and more sustainable in our transportation processes by reducing emissions and the impact on the environment. The need is on the market, the projects like TBEx play an important role to lead the development, listen to the needs and deliver solutions which support the busi-ness of the many stakeholders.




!How can we influence speeding up the upgrade of the Meråkerbanen/Atlantbanan rail connections?

There is a lack of many upgrading investments in Norwe-gian railway infrastructure, and priority in time and money is hard to realize. Since November 2013, the Atlantbanan has been closed to railway traffic due to insufficient railway construction at “Stora Helve-tet” near Storlien; the railway line will be closed until autumn 2015. The traffic will resume for one year, before the rail line will be closed again for further works that are designed to finish in 2018.Regarding upgrading Meråkerbanen, we expect that the railway line will be closed several times during electrification and other railway works during the investment period.We have tried our best to have the upgrading works at Meråker-banen completed before schedule. Despite the arguments we used, it has resulted in a situation where we need to accept the given time schedule, unless we want to lose the whole investment altogether. We have concluded to accept the time schedule (see the table) and from now on and until 2018 we will focus on using the railway line Trondheim-Kongsvinger-Hallsberg-Karlskrona for cargo to and from Southern Sweden and Eastern Europe. The cargo flow in the North East Cargo Link corridor has to be transported by trailers on roads until 2018.

Detailed plans for upgrading the Meråkerbanen railway line

Investments Year Total costElectrification (Trønderbanen inclusive) 2018-2023 NOK 2,611 mlnStation and crossing adaptions 2018-2023 NOK 668 mln

!Could the Hell/Muruvik terminal in Trøndelag play the role of an export and import terminal for Sweden and Finland in the perspective of the upcoming SECA regulations enforcement?

The Muruvik terminal (privately owned) can load/unload vessels up to 10 m of draft. They can also load/unload cargo trains (containers, trail-ers, cargo wagons) and trailers. The terminal is mainly used for vessels and trailers today, but the railway line of 3 x 200 m is ready for use.The terminal owner is willing to invest more in the terminal if higher vol-umes will come, and more investments are necessary. Based on today’s knowledge, we see no direct arguments to support Muruvik becoming a more important terminal for Sweden and Finland in the future.

As we all know, in the European SECA (Sulphur Emission Control Area) the highest permitted sulphur content of fuel will fall to 0.1% from January 1st, 2015. Therefore, a ship owner must switch to LSM-GO (Low Sulphur Gas Oil, LNG, methanol or another fuel with the

required sulphur level. Alternatively, the ship can be equipped so that it is capable of reducing the sulphur level in the ex-

haust gas to an equivalent level. The exhaust gases can be adapted by installing scrubbers in the ship. The ef-

fort to comply with the regulation is enormous. On average about 5,000 ships trade in the SECA area. More than 2,000 ships stay within the SECA area 100% of their operating time. A large majority of the fuel consumed is HFO (Heavy Fuel Oil).According to surveys, most of the ship owners have/or plan to switch to LSMGO in 2015. Marine

fuel represents a minor share of the overall Euro-pean diesel market. Therefore, it will be possible to

meet the additional demand for LSMGO, which is esti-mated to be 10-12 mln tn. The long-term price difference

between LSMGO and HFO is expected to stay at today’s level of USD 300-400 per tonne if the current oil price remains stable.

Scrubber installations are going on and planned for ships built after 2000. The payback time for a scrubber installation is only one or two years for ships trading 100% in the SECA area. An LNG supply chain is currently being built. The current challenge regarding LNG is that the price of LNG is not competitive and the distribution is too costly due to the low LNG bunkering volumes. For newbuildings, LNG is more favourable and an increasingly larger share of the new ships will use LNG. DNV GL expects that the cur-rent European LNG-fleet will grow from 66 ships in 2013 to 400 ships in 2020. It is expected that economies of scale will have an effect gradually, and the price of LNG and the logistic costs will decrease making LNG an at-tractive fuel towards 2020.The SECA Directive will therefore influence short sea shipping to and from Muruvik as well.

Jon L. GjembleSenior Advisor Logistics, TransLog Gjemble

The effort to comply with the SECA

regulations is enormous. On average about 5,000 ships trade in the SECA

area. More than 2,000 ships stay within the SECA area

100% of their operat-ing time.

“

Phot

os: T

rans

Log G

jemble

The current challenge regarding

LNG is that the price of LNG is not competitive and the distribution is too costly due to the

low LNG bunker-ing volumes.

“




Primarily, I wish to express my interest in such solution as ACE Green, as well as my positive reception of the idea – as a justifiable one and useful for us, mainly due to the delivery time reduction, which is a matter of key im-portance when dealing with fresh fish. Yet, the logistics of delivery from Norway and Sweden is our suppliers’ re-sponsibility. We buy at the point of delivery and cooperate with any company farming and selling salmon. Incidentally, we do organize transport, this however only happens a couple of times a year, as far as these directions are considered. Therefore, to my view, suppliers of salmon from Norway should be inquired, as they might offer more information and thoughts as regards the justifiabil-ity of ACE Green (salmon is the main raw product procured from this direction).

Małgorzata Dragun Procurement Director, GRAAL Capital Group

Term

inal P

CC Br

zeg D

olny,

photo

: PCC

Term

inal P

CC Ku

tno,

phot

o: PC

C Te

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Gliw

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: PCC

mains a problem in the process of building the North-South’s

competitiveness. The nod-al infrastructure we have

in Poland keeps improving, the linear is modernized on a continual basis (we should be able to see the effects of modernization in 2-3 years), but there is still one neural-gic issue we have to face – namely, the logistic aspects of handling shipments

in the hinterland facilities at the ports of Gdańsk and

Gdynia, to optimize the inland move-

ment of freight to/from the south of Eu-rope. We shall stress again and again that a dry port

in the hinter-land of Gdańsk

and Gdynia will al-low all of us to man-

age the flow of cargo volumes between Scandina-

via and Southern Europe better and to develop an offer capable of transferring much of the long-distance carriage from roads to rails.Transport alone is not enough today – we need smart logistic solutions to guarantee an optimized time of transportation, translating into maximum cost-effectiveness. For logistics to be able to sup-port transport, and for transport to be able to

The ACE Green Corridor Project, showing syn-ergy with initiatives aimed at developing competi-tive trade exchange and effective logistic solutions in the Baltic-Adriatic corridor, is in line with an idea which PCC Intermodal has been disseminating for 10 years now. And although it is a good thing that there are so many debates, discussions and projects focussed around this subject, it should be stated clearly that while we do not have to worry about freight chains, it is infrastructure that still re-

Monika Konsor-FąferekMarketing & Development DirectorPCC Intermodal S.A.

The logistic aspects of handling

shipments in the hinter-land facilities at the ports

of Gdańsk and Gdynia is still a neuralgic issue we have to face to optimize the inland

movement of freight to/from the south of

Europe.

“

stimulate trade exchange, tools (Intermodal Container Yard) and

a synergy of actions is needed. The example of trains from China to Europe we arrange these days shows remarkably well that the railway is a golden solution: what can wait and is showing a signifi-cant price flexibility will be carried by sea; what is in a great hurry, light and of high value, while at the same time not forming large and dense load flows, will take airborne transport; heavy and regu-lar shipments in need of a fast but not express delivery, showing moderate price flexibility will, on the other hand, be seeking solutions offering the highest added value in terms of cost and opera-tion (since time is a cost too!). For the last category of freight, intermodal transport (railway + road) will be an ideal choice.The ACE Green Corridor is an exquisite initiative, which needs support and an active approach from various stakeholders. As an intermodal op-erator operating a regular network of railway con-nections and five of its own terminals (Kutno, Brzeg Dolny, Gliwice, Frankfurt Oder, Dębica) and two partnering terminals: Duisburg and Małaszewicze/Brześć, we are its great supporter. We regard the initiative of building an open, commonly accessi-ble dry port in the Pomeranian region to be our special contribution to the development of the corridor’s potential, an interface enabling optimi-zation of supply chains from Scandinavia, via Cen-tral Europe, to the South and East.

The ACE Green Corridor is an

exquisite initiative, which needs support

and an active approach from various stake-

holders.

“

Photo: GRAAL Capital Group

Delivery time reduction

is a matter of key importance when

dealing with fresh fish.

“




make a good service if they are better, that is, competitive in quality, time and cost-effi-ciency to the existing transport possibilities. The goods are already moving to Poland, so in order to create a modal shift from lorries to rail, you actually have to be better.

! Is there a possibility for ACE Green to attract more northbound cargo from Poland to North-ern Scandinavia – including cargo from South-ern and Eastern Europe?

I am not sure you could attract more goods within the concept of moving something with rail instead of lorries. On the other hand, if you create a better lo-gistics alternative, including rail, with the possibility of goods being shipped with-out drivers and arrive like that to the Port of Gdynia, perhaps on a train – this would make the uptake area for freight going in this corridor bigger. If you therefore ex-tend the aim by funnelling freight and increasing the role of rail, you will have a better uptake area for that type of cor-ridor. But this is only cost-effective if you take away the drivers.

!How can projects like TB Ex contribute to transport and logistics business operations?

If you can establish a new way of thinking on some issues and attract the interest of

businesses, which could gather around a table, learn, clarify things and look at different opportuni-

ties in order to discuss them, then you have achieved something. In terms of communicating between different actors operating in various ways, projects like that bring them closer to cooperation, sometimes creating chances which didn’t exist before. This is actu-ally thrilling in initiatives like the Trans Baltic Extension. What I would like to emphasize at the end, is that we should look in the direction of the freight owners more, not only the operators, because opera-tors will leave as soon as the prices are not good enough. With such a project as TB Ex you can actually wake up the goods owners and by that perhaps get other transport solutions in place, because they actually want things to happen. The closer you get to the customers and the more demands they can make on transportation, the closer you get to bettering the transport system.

Publisher Baltic Press sp. z o.o. ! Address ul. Pułaskiego 8, 81-368 Gdynia, Poland ! tel. +48 58 627 23 20, tel. +48 58 627 23 24 ! website www.baltictransportjournal.com ! Editorial Team Editor-in-Chief Lena Lorenc [email protected] ! Features Editor Przemysław Myszka [email protected] ! English Language Editor Alison Nissen [email protected] ! Art Director Danuta Sawicka [email protected] ! Head of Marketing & Sales Przemysław Opłocki [email protected] ! Marketing & Sales Manager Anna Dąbrowska [email protected] ! President of the Board Bogdan Ołdakowski ! If you wish to share your feedback or have information for us, do not hesitate to contact us at: [email protected].

!How can we get the 3Links partners to adapt the work of the ACE Green project in regard to Trondheim and possibly other terminals in northern Norway to be included in this network?

Transport is quite a dynamic business. Everything is moving and changing, starting from behaviours and modes, through pricing, op-erators vanishing and popping up, to the issues regarding the environ-ment. We at Stena Line have very close relations with the TransBaltic Extension project and its participants. At the moment I am cooperating with the communities of Region Örebro and Karlskrona, in order to find a geographical area with freight owners interested in changing their transport patterns and behaviours – this is actually what we are looking for in Trondheim. And the other aspect of our cooperation is to create a proper product, which is equally good or better than the one done in the existing production method, which could fuel transport to/from Norway and Poland. In Stena Line we don’t believe that this method will change, unless a better pricing is in place.I would also like to emphasize to the project coordinators that there is no use in trying to sell green transport, it doesn’t exist. They can only

Christer Kjellberg Group Freight Rail & System ManagerStena Line Group Freight, Stena Line Scandinavia AB

The goods are already mov-ing to Poland, so

in order to create a modal shift from lorries to rail, you

actually have to be better.

“

Phot

o: St

ena L

ine

www.baltictransportjournal.com

Documents

Think transport | Think energy The Green · PDF file5/2014 ! BTJ Think Tank! 2 T Project part-financed by the European Union (European Regional Development Fund) Project part-financed