Underground Freight Transport - A Challenge for the Future :The Link in the Chain

2nd Progress Report Interdepartmental Underground Transport Task Force

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NB: KAFTTable of ContentsSummary Introduction Note to readers1. Chapter 1 Introduction to the underground

1.1 Background and objectives1.2 UTP on the agenda1.3 Relevant developments

2. Chapter 2 Definition of the problem2.1 Policy framework2.2 Definition of the problem

3. Chapter 3 Work in progress3.1 Introduction3.2 Logistic developments3.3 Feasibility studies3.4 Generic studies

4. Chapter 4 Logistics developments in the future4.1 Introduction4.2 ULS and logistics changes; a possible scenario4.3 Traditional pipeline transport and logistics changes; a possible scenario4.4 How can these scenarios become reality?

5. Chapter 5 Co-operation to get results 5.1 Introduction 5.2 Feasibility studies ULS

5.3 Design studies ULS5.4 Feasibility studies Traditional pipelines5.5 Generic studies

6. Chapter 6 The continued IUTTF- agenda7. APPENDIX 1 Legislation and administrative-legal aspects8. APPENDIX 2 Composition Transport by Pipeline Platform

Summary

In September 1998 the first progress report,“Underground freight transport - a challengefor the future”, was discussed in the LowerChamber. The regular parliamentarycommittee for Transport, Public Works andWater Management took note of the resultswith approval, and decided to continue theresearch programme. The InterdepartmentalUnderground Transport Task Force (IUTTF)then set to work on it with great vigour. Theemphasis was shifted from basic theoreticalresearch to concrete feasibility studies –technical feasibility in particular - in whichthe following questions came to light: “IsUnderground Transport and Pipelines (UTP)possible, and if so, under what conditions?”“Is there support for it?” and “Whatdevelopments in transport and logisticsinfluence the choice of a means of transportin the long term, and does UTP fit in withthat choice? The (social) benefits are givenlittle consideration in this phase; they are

handled in the last phase. The effectivenessof an underground solution for the growingtransport demand must then be comparedwith other possibilities.

On the whole, the feasibility studies indicatethat urban Underground Logistics Systems(ULS) have more prospects than wasoriginally assumed. A major part of goodstransport destined for the city centre can bedelivered via ULS’s. These studies alsoshowed that a national ULS network is notabsolutely necessary for this type oftransport. It is essential, however, to createan intermodal network which connects tourban ULS’s. A combination of ULS with anintermodal network would make the systemcost-competitive. The picture is different forregional and industrial ULS’s. For ULSAalsmeer-Schiphol-Hoofddorp, PublicPrivate Partnership (PPP) proposals forinvestment and operation are expectedtowards the end of 1999. For the feasibilitystudy in South Limburg (DSM pilot), thepicture has not yet fully taken shape. Interms of investment costs, a ULS isexpensive compared to a solution using roadtransport, whilst the operational costs of thedifferent solutions are similar. No choice hasbeen made as yet. According to theresearchers’ opinions, all studies show thata government contribution appearsnecessary for the profitable operation of aULS. One must keep in mind that theestimates of costs and revenues are veryapproximate at this stage.

Studies of traditional pipeline transport(networks for propylene and ethylene) havenot been completed yet; results are expectedin the autumn. Meanwhile, a subsidy hasbeen promised within the framework of theCO2 policy for the construction of a Multi-Core pipeline system in the port ofRotterdam. The port installation will mostlikely make an investment decisionconcerning the construction. The co-operating power companies submitted arequest for a subsidy for a CO2 network tothe government and received a positiveresponse.

Nothing ventured, nothing gainedL.C. Brinkman, LL.M., M.Sc., Chairman ofAVBB (General Association of theConstruction Industry)“Underground construction is an important topicof discussion. The possibilities of adding a thirddimension to our country are being explored withgreat drive and dedication. In doing so, our credois: aboveground if possible, underground ifnecessary or it if offers better quality in the longrun. We must Intensify know-how anddevelopments in this field and continue to do soin the years to come. At the same time, we mustconvert the knowledge we already have intopractical expertise. In doing so, we must venturein order to gain, so to speak. Both the politicaland business world must be willing to becomeactively involved. The parties involved in ULSAalsmeer-Schiphol-Hoofddorp have alreadyachieved considerable progress. The businessplan indicates that the total system can beprivately financed with a substantial financialprofit. An extra contribution from the governmentwill give the last boost if required. Within tenyears, The Netherlands can become a marketleader in boring tunnels under difficult conditions.We have to work on that now.”

The current feasibility studies will soon becompleted, depending on the decisions ofthe initiators. A few of these studies areexpected to be continued as planningstudies. The actual completion of theseplanning studies will depend on the co-operation of all parties involved. The ULS-ASH project is in a different phase – the pre-design phase. On the basis of thePPP(Public Private Partnership) proposalsexpected at the end of 1999, decisions willbe made on the possible implementation ofULS-ASH as a pilot project. It is alsoimportant to continue studies on whether itis possible to develop an intermodalnationwide network that solves transportproblems of the future and which canprovide the ideal connection to the urbanand industrial ULS’s.The generic research programme forunderground transport continues. Theofficial opening of a Test Site for transporttechnology falls within that framework. Andfinally, a communication campaign is beinginitiated to make UTP more well-known as a

solution for transport problems and to createsupport among all market players andauthorities involved.

All results will be processed into proposalsfor government policy concerningunderground transport. The proposals coverpolicy for both goods transport andinfrastructure, spatial planning reservationsand spatial-economic policy. The VanHeemst - motion will be answered at thesame time. The final report of IUTTF can beexpected by mid-2000.

Introduction

The shelves in the shop can still be stockedon time. With a good dose of ingenuity,businesses can still get their products to theright place, just in time. But this is expectedto become more and more difficult; goodstransport is experiencing more and moreproblems. It is essential that we deal withthis issue. The desirable scenario is a safe,competitive and sustainable goods transportsystem that supports the desired growth ofprosperity. It is clear that the goodstransport system of the future must be moreefficient. We must invent better, smarter andmore creative ways of using theinfrastructure. But innovative solutions areneeded as well, with new forms of goodstransport and a more efficient transportsupply chain. Underground Transport andPipelines (UTP) is an innovative andsustainable possibility for making traffic andtransport systems more “intelligent”. Atpresent, it is perhaps a bridge too far, so tospeak, but a few feasibility studies on UTPhave in any case substantially stimulatedthinking about new innovative transportsolutions. Thinking about solutions thatopen up new horizons is gaining ground.

“Creating a breakthrough using practicalknowledge”

W.N.C. Heeren, B.Sc., General Director of Jande Rijk Logistics:“During the past few years, a great deal of studyhas been directed at possibilities in the field ofUnderground Logistics Systems, ULS. Thesestudies have produced wonderful ideas, whichnot only merit theoretical consideration, but alsopractical testing. Practical testing through pilotprojects, for example, provides knowledge andinsight which barely comes to the surfacethrough study alone. In such tests, considerationmust be taken of processes and facilities at thefront of and behind a ULS. Think, for example, ofharmonising the start and finish of the transportconnections to the underground system. Or theneed for a rail connection, which we believe tobe of vital importance for the ULS between theAalsmeer Auction and Schiphol Airport.A breakthrough could be realised if anentrepreneur were to come forward who is goodin his profession and has experience and newideas in the field of multi-modal transport. Abusiness person who dares to risk his neck byputting ULS into the world. This could yieldpractical knowledge in the field, enabling theNetherlands to keep ahead of the competition foryears. The government would be expected tosupport this initiative. Not only through financialcontributions, but by stimulating and co-ordinating efforts in this direction.”

Underground transport is now clearly on theagenda. Since the publication of“Underground freight transport - a challengefor the future”, the discussion has certainlygone the rounds. The emphasis has shiftedfrom congestion to accessibility, and fromtechnology to feasibility in terms of socialaspects and business economics. People areunderstandably critical, and we are certainlynot so far ahead that we can say “UTP iscoming”. It is an option with prospects,which is worth studying and bringing up fordiscussion in business and governmentcircles. There are opportunities for theapplication of underground logisticssystems for general goods, and forstimulating traditional pipelines as a meansof transporting liquids and gases.

This progress report gives an account ofcurrent research on UTP, presents theresults of the feasibility studies andidentifies the developing visions of transport

in the future. Priority was given to initiatingfeasibility studies. It is clear that withoutfinancial participation from the government,this form of infrastructure cannot or canbarely get off the ground. Ultimately,underground transport must be weighedagainst the other modes of transport, interms of cost effectiveness.

This report is intended as a catalyst tostimulate discussion on the direction topursue for UTP policy. It also serves as abuilding block in discussing the role thatUTP can play in traffic and transport policy,regional planning and spatial-economicpolicy in the long term. This report is aninterim step toward the final report, a visionof UTP, which will be published mid-2000.After that, it will be the politicians, not theresearcher, who must take the lead.

Note to readers

The reader who is already familiar with themotivation and previous history of policydevelopment concerning undergroundtransport should immediately start readingChapter 4. Chapter 4 gives a few visions (stilldeveloping) of transport in the future.Chapter 5 contains the first results of thefeasibility studies which have beenconducted since the publication of the firstprogress report “Underground freighttransport - a challenge for the future”. Thedifferent actions to be taken in the next fewmonths by the Interdepartmentalunderground transport task force (IUTTF) arelisted in Chapter 6 for easy reference.Because the research and the policydevelopment do not stand alone, and sincethe material is undoubtedly still new to somereaders, Chapter 2 in this progress reportdeals with the problems which led to thestudy of the possibilities of undergroundtransport. In Chapter 3 the work programmeof the IUTTF and the tasks of the differentworking groups are discussed.

“Competitive power is innovative power”

Prof. A.A.J. Pols, M.Sc., Technical Universityof Delft, Faculty of Civil Engineering:

“Underground transport should have theopportunities it deserves. Public and privateparties who can play a part should have enoughspace, and not be immediately forced into thestraitjacket of existing conventions andstructures. Because of our Dutch culture of ”justact normal, you’re already strange enough”,innovations can lose a lot of their (competitive)power. Critical success factors are:concentrating on the most promising locations,sweeping integration of technical solutions andlogistics innovation, as well as fitting in regionaldevelopment projects in sufficient breadth. Toomuch originality is sacrificed because theconcept just has to fit in with what already exists.I find that a terrible shame, andincomprehensible. Underground transport shouldhave the chance to add optimal value to what iscurrently available in transport and logisticspossibilities. The government’s task here is tocreate, through policy measures, a stimulatingclimate and to give innovative ideas andconcepts a wide scope in which to develop. If itis all properly handled, the Netherlands will havethe opportunity, just like Japan, to build up astrong international position. Particularly in thefield of intermodal transport. We may not andmust not fail to take advantage of thisopportunity.”

1. Chapter 1 Introduction to theunderground

1.1 Background and objective

The Van Heemst1 motion, supported by theHouse and submitted during the budgetdiscussions of Transport, Public Works andWater Management at the end of 1996, laidthe foundation for the study on thepossibilities of UTP. The Ministries ofTransport, Public Works & WaterManagement; Economic Affairs; andHousing, Regional Development and theEnvironment combined forces and set up theInterdepartmental Underground TransportTask Force (IUTTF) during the course of1997. The business world joined in byestablishing the Transport by PipelinePlatform. A first exploratory analysis wasrounded off in April 1998. The results are setdown in the progress report “Undergroundfreight transport - a challenge for the future”and the accompanying cabinet paper.

The main question posed by IUTTF in thefirst phase was: Is underground transport adesirable and viable mode of transport forthe 21st century? Attention was focusedespecially on the theoretical feasibility ofUTP. The studies and resulting conclusionsformed the first draft observations at amacro level. These were developed into afirst progress report aimed at providing anunderstanding of the possibilities of UTP –including innovative transport concepts,such as the ULS, as well as the traditionalpipeline transport of oils, chemicals, waterand gases.A second goal was to provide insight intoother relevant aspects, such as the social,economic and sustainable effects that makeit possible to evaluate the feasibility of UTP.

The conclusions of “Underground freighttransport - a challenge for the future”

1 “requests the government to indicate, no laterthan the next MIT, the conditions under whichpipelines and piping are to be designated aspublic facilities” (TK, 1996-1997, 25003, no. 8)

indicated that underground goods transporthas potential, both for the traditionaltransport of liquids and gases and forgeneral goods through ULS. Optimisticforecasts are based on a 34% market shareof domestic goods transport, which is nowonly at 9%. The advantages mentionedinclude: improvement in the quality of life¸greater safety and reliability, less burden onthe environment and precious space, and amultiple, more effective use of space. All inall, in some configurations UTP could form agood alternative or a useful supplement torail and road infrastructure, and couldcompete with road transport in terms ofprice. One disadvantage is that with thesestarting points, a ULS would only reach it’spotential in combination with a nationwidenetwork. This would entail very highinvestment costs.In the letter accompanying the progressreport which the cabinet sent to the House,the government wrote that it considers UTPan environmentally friendly alternative toroad traffic. In view of the prospects of UTP ,the cabinet proposed intensifying the UTPresearch programme with extra focus onintegrating ULS with the other modes oftransport. In this way, the advantages of thedifferent modalities can be combined withlower system costs.

“Give underground transport realisticattention”J. Stekelenburg, Mayor of Tilburg andChairman of the Southeast Corridor Team ofIncodelta:“In preparing the new government memorandafor Regional Planning and Traffic and Transport,it is important to develop a future vision forgoods transport together with other parties inthe Southeast Corridor regions. But we mustn’tget bogged down sketching scenarios that aredifficult to realise. By this I mean that besidesfuture visions, concrete projects must be workedout by government authorities and the businessworld. Underground transport also plays a role indeveloping a vision and in concrete projects. Iconsider it important to look at alternatives toroad transport.Underground transport in the Southeast Corridoris already important. Just think of the pipelinetransport between different chemical complexes.In the transport to and from these companies,

there are even more possibilities which are beingconsidered by chemical concerns and thenational government.In discussions about underground transport,people are sometimes too optimistic about theterms under which it can be realised. When Ihear people talking about supplying cities viaunderground transport, then I think that we arenowhere near even the threshold of such adevelopment. Once flows of goods toward citiesare combined, then you can possibly startthinking about underground systems in thelonger term.I also see opportunities elsewhere: in theSoutheast Corridor are examples of companies,particularly in the processing industry, which arenot located directly on a waterway, but who stillwant to use inland shipping as a mode oftransport. Via pipelines they could have aconnection with a nearby inland harbour. Theseare interesting projects because you can removemany, many tons of goods transport from theroad. It’s important that the market is ready for it.Keep both feet on the ground and choose arealistic approach.”

Now that important policy documents suchas the National Traffic and Transport Planand the 5th Regional Planning Document areforthcoming, it is time to discuss the matterof UTP within these policy frameworks.Indeed, we now need the building blocks forthese key memoranda.For that matter, UTP has already beenmentioned in the Perspectives Paper forTraffic and Transport and the InitialMemorandum for Regional Planning 1999,various discussion papers on traffic andtransport and the spatial-economic policy, asa mode of transport with potential.The objective of this progress report is toshow the state of affairs in the field of UTP.The results of the research and feasibilitystudies enable politicians to consider whatplace UTP should occupy in the policy. Thereport can therefore function as an interimstep toward the policy vision which thecabinet will bring out in mid-2000. In thisvision a final consideration will be made asto whether underground transport is adesirable and viable mode of transport forthe 21st century.

1.2 UTP on the agenda

After “Underground freight transport - achallenge for the future” appeared, thesubject was energetically discussed invarious committees. In its recommendation“Spatial Renewal for Goods Transport” inthe summer of 1998, the Council forTransport, Public Works and WaterManagement first made a passionate appealfor the development of undergroundtransport. For the Council, undergroundtransport is one of the three main pillars oflong-term policy for domestic goodstransport. For the short term, the Councilproposes setting up a system of urbandistribution centres as a contributiontowards an underground network.

The importance of underground transport isalso recognised in the Coalition Agreement1998 of the Dutch cabinet. The agreementstates that the environmental disadvantagesof goods transport must be compensated asmuch as possible through a shift fromtransport by road to transport on water, byrail and pipelines (ULS and urbandistribution systems).UTP is now regularly on the political agenda.The Minister of Transport, Public Works andWater Management, also on behalf of hercolleagues in Economic Affairs andHousing, Regional Development and theEnvironment, discussed “Undergroundfreight transport - a challenge for the future”with the standing Parliamentary Committeefor Transport & Public Works in September1998. The House showed enthusiasm for thepossibilities of UTP. The parliamentaryparties would like to see UTP have such aprominent place in the next Long-rangeProgramme for Infrastructure and Transport(LPIT) that the House will be able to considerthe political and financial aspects. They alsopointed out the importance of including UTPin frameworks involving policy, such as theNTTP, the 5th Memo on Regional Planningand the Spatial-Economic Policy Memo(SEPM). The House agreed to the proposedapproach in “Underground freight transport -a challenge for the future”: intensifyingresearch and starting feasibility studies.

Continuation of these studies was discussedwith the Central Planning Agency (CPA). The

CPA could agree with the structure of theresearch plan as well as the idea of stock-taking studies as part of “Undergroundfreight transport - a challenge for the future”.A point of criticism the CPA mentioned wasthat the problem analysis had not beenadequately worked out. So it was decided tofocus extra attention on this point in the nextphase and to view UTP particularly in light ofthe problem inquiries for the NTTP, 5th Memoon Regional Planning and SEPM.

1.3 Relevant developments

For the transport and goods transport oftomorrow, expertise is indispensable. This iswhy the government and business world areworking towards combining their knowledge.The institute for research and developmentof knowledge concerning transport(Connekt) has the task of substantiating thepolicy choices facing the Netherlands in theyears to come. The Transport TechnologyCentre (TTC) , which will soon beincorporated into Connekt, fulfils animportant role in the development oftechnological know-how which is necessaryfor underground transport. The Transport byPipeline Platform also plays an importantpart in forming a vision in the sphere of newlogistics concepts. And further, theUnderground Building Centre (UBC) haspresented surprising new ideas on using theunderground.The cabinet attaches great importance toexpanding the knowledge infrastructure as itrelates to strengthening the spatial-economic structure. As regards ICES-KIS, atthe beginning of this year a sum of ninemillion guilders was set aside for gainingmore knowledge concerning undergroundlogistics systems.

The “Underground freight transport - achallenge for the future” report functionedas a catalyst for submitting new ideas. Thebusiness community and regionalgovernments are also seriously thinkingabout the possibilities of UTP. An innovativedevelopment is the transport, buffering anddistribution of CO2 in pipelines togreenhouse gardeners. A few energydistribution companies are going to offerCO2 from Shell Pernis to greenhouse

gardeners via an existing unusedunderground pipeline. This will meanrecycling of CO2, a good example ofcombining sustainable development andeconomy.In addition, the city of Almere has the idea ofincluding an underground waste transportsystem in the development of its city centre,thus contributing towards a high-quality,sustainable social climate. This system canhelp reduce mobility and the burden on theenvironment.

“Can waste through an ULS make multi-modal transport more profitable?”P.P. Grielen, M Eng., Van Gansewinkel GroepBV“If I look at the transport of waste, I’m talkingabout large flows. In the city centres, thecollection and transport of waste is problematic.Refuse lorries disturb the flow of traffic, whilewaste transport suffers from existing congestion.So the removal of waste via a ULS can be anattractive alternative. The cost aspect requiresattention, however. Currently, when goods aredelivered to a chain store, dry waste is takenback (reverse logistics). If ULS is used fordelivery, this option is no longer possible.Combined with the waste of small companiesand private parties, waste removal via ULS canbe an interesting option. The transport of wetwaste will entail stringent requirements,however, for reasons of hygiene and odournuisance. In order to make ULS suitable for thecollection and keeping of waste, wastecompression, storage and transport, challenginginnovations are needed (such as hermeticallysealable containers). And this, of course, has aprice tag.Because the city centre, which is more or a lessa closed unit, is a producer of large quantities ofwaste, underground transport can make apositive contribution towards improving theurban environment. In terms of costs,underground waste removal can function notonly as the primary carrier of the system, but willalso facilitate the supply of (consumer) goods.”

Important steps have been taken on aninternational level as well. For example, UTPwas explicitly included in the 5th FrameworkProgramme of the European Commission.Here lies a challenge for market players to

submit research proposals in the domain ofinnovative underground logistic systems.The European Commission is formulating itsvision on traditional pipeline transport.

Chapter 2Definition of the problem2.1 Policy framework

Since the publication of “Undergroundfreight transport - a challenge for the future”,the Perspectives Paper of Transport, PublicWorks and Water Management and the InitialMemorandum for Regional Planning 1999have come out. These memos form theframework for the discussion of the traffic &transport policy and physical planningpolicy to be pursued in the decades to come.Reason enough to bring the definition of theproblem from the first phase up to date. Afew trends and dilemmas regardingunderground transport and pipelines can beobserved: Claims on space are mounting – both

qualitatively and quantitatively – forliving and work, traffic, green space andrecreation.Loss of function is becoming a threat.

The growing need for mobility threatensthe availability of clean air, peace andquiet, unbroken areas and safety, andleads to decreasing accessibility.

The economy continues to grow:national developments have become apart of processes on a European andworldwide scale. From an economicpoint of view, we must have excellentaccessibility; however, from theenvironmental policy viewpoint,economic growth cannot become anenvironmental burden.

Continuous growth in population andmobility: goods transport is expected todouble by 2030 compared to the 1995level, while container transport isexpected to triple! The question is if andhow our infrastructure can accommodatethis.

This leads to a number of points ofdeparture for UTP-related policy-making: Urban areas are developing into

complete, vital network cities with adiversity of environments.

City centres will remain the focus of avital city, now and in the longer term.

Combining physical dynamics requiresplanned corridor development.

Corridors are part of an internationalstructure and require good transportpossibilities and multimodal junctions.

The transport and distribution of goodsrequire modernisation of the logisticssupply chain, electronic infrastructureand underground logistics systems.

Economic growth and pressure on theenvironment must be separated evenmore. The environment must benefitprimarily through efficient use of energy,traffic and transport, and agriculture.

2.2 Definition of the problem

Growth in goods transport is difficult toaccommodate with the present modes oftransport, especially in densely populatedareas. Consequently, discussions devoted toinnovative, smart, sustainable and safetransport systems abound. UTP is one ofthese innovative options that deservesfurther study.Other developments also promptconsideration of existing goods transportsystems. Studies show that major changeswill become apparent in the distribution ofgeneral goods (particularly food products).In the future we will see increasingly smallershipments go to shops in increasinglyhigher frequency from a declining number ofregional distribution centres. This meansthat road traffic, measured in numbers oflorries and delivery vans, will increase evenmore than was originally estimated.Working on UTP is working on moreintelligent logistics. Such logistics alreadyexist, but usually within one mode oftransport. The future needs intelligentintermodal logistics which will utilise theexisting infrastructure and means oftransport more efficiently.

UTP is aimed at three levels in goodstransport:

Underground Logistics Systems forurban distribution

Underground Logistics Systemscombined with aboveground modes for anationally linked network

Innovations in traditional pipelinetransport: make pipelines accessible tothird parties, lay several pipelines atonce (multi-core systems) and buildutilitarian tunnels.

Summing up, we may say that step by step,we shall see where the opportunities andpossibilities lie. In specific situations and forspecific applications, UTP offers prospects.It is not a remedy for all problems, but rathera promising new link in the logistics supplychains.

The above leads to the following adjustedgeneral definition of the problem:

In which situations and under whatconditions is UTP a realistic option whichcan make a positive contribution to issuesconcerning accessibility, economic structureand the environment.

3. Chapter 3 Work in Progress

3.1 Introduction

The work currently in progress in theframework of the 2nd phase of IUTTF is basedon the definition of the problem asarticulated in Chapter 2. The workprogramme is divided into three subjects:relevant developments in logistics,conducting feasibility studies andconducting generic studies. Each subjectwill be handled briefly below. During thecourse of next year, this must all besynthesised into a cabinet policy vision ofthe possibilities of underground goodstransport.

The figure below / opposite shows theapproach in a diagram:

3.2 Logistics developments

The logistic processes which lie at the basisof goods transport are constantly changing.UTP anticipates these developments in thebusiness world and links up with them.Keeping an eye on these developments isimportant. This is why Chapter 4 discussesthe future transport of general goods viaunderground logistics systems (ULS) andnew possibilities for traditional pipelinetransport. These developments in logisticswill be discussed with the businesscommunity and the regional authorities inthe near future. They will be tested in variousfeasibility studies for logistics feasibility,cost effectiveness and support.

3.3 Feasibility studies

One conclusion in “Underground freighttransport - a challenge for the future” wasthat feasibility studies are indispensable forgaining an understanding of all aspects ofUTP.Feasibility studies serve as learning tools forcountless fields of knowledge: transport andlogistics, technology, business-economiceffects, social effects, aspects of legislationand regulation, financing and PPS. Pilotprojects form an absolute condition forgaining insight into all aspects ofunderground transport. For this reason,

priority is given to starting up variousfeasibility studies in the 2nd phase of IUTTF.

Logistic

Developments

Definition of problem Feasibility studies Government vision

Generic studies

The choice for specific studies is based ontwo points of departure. The first is that eachfeasibility study had to distinguish a clear“problem owner” whose transport- oraccessibility problem could be solved withUTP. The second condition was that thestudy had to have a clear added value forpolicy development within the framework ofIUTTF. Only initiatives which demonstrablymet both conditions were selected asfeasibility studies. The studies wereconducted under the responsibility of theinvolved market players, but weresupervised and financially supported byIUTTF.

“You can learn a lot from an old city”Tj. Van Rij, Alderman for the City of Leiden“In Leiden, but I think in other historic citycentres as well, underground transport offers agood solution in the quest for a liveable andlively city. We’ve been busy improving thehistoric centre in Leiden for years. Our policy isaimed at making the limited space in the citycentre accessible to residents and visitors.Consequently, automobile and lorry traffic mustbe reduced. At the same time, we want to keepLeiden dynamic, which implies that the city mustbe accessible and that the goods that arenecessary in order to be able to work, live, shopand seek recreation can get in and out.Underground transport is an excellent way tofulfil that ambition. It saves the environment,keeps the city liveable and provides thenecessary goods.The feasibility study has shown thatunderground transport offers a likely andcertainly technically viable solution, butcontinued study will have to support the idea. Atfirst glance it seems a costly investment, but onewhich can economise in other areas, especially ifit is incorporated in a good multi-modal nationaltransport system.The national government has an important task,together with the business community and otherauthorities, of realising an undergroundinfrastructure for the distribution of goods. So I

argue in favour of the Government reservingfunds in its long-range investment plan. Anational, multi-modal transport network does notsimply appear all at once, of course. But youhave to start somewhere. Leiden is an extremelysuitable place to test out the technology becauseof its easily surveyable scale, central location inthe Randstad and good accessibility by road,water and railway.”

3.4 Generic studies

In addition to the feasibility studies, a fewstudies are being conducted regardinggeneric issues, which are under discussionin the working groups concerned withLegislation and Regulation, Spatial PlanningReservations and Communication. TheLegislation and Regulation working group isexamining what adjustments in legislationare needed to stimulate the construction ofunderground transport and pipelines.Solutions are being sought for procedures,intrinsic and external safety, crisismanagement, registration and informationand the line manager’s position (includingthe question of how far the rights ofownership reach under the earth). TheSpatial Planning Reservations workinggroup is primarily concerned with thequestion of how to ensure continuedunderground access through effectivespatial planning reservations, and howunderground transport and pipelines canbecome a mode of transport of equivalentvalue to existing infrastructure, as laid downin the Structural Plan for Traffic andTransport. The Finance working group islooking at financing construction of UTPprojects and mapping out sources offinance, and is also studying thepossibilities of Public-Private Partnershipstructures (PPP). The goal of theCommunication working group is to makeUTP known and to create support in thebusiness community, the government andother social organisations.Furthermore, a study is also beingconducted on a national connecting networkfor UTP. Ideas range from an undergroundnetwork to a multi-modal network composedpartly of intelligent transport chains, to thedevelopment of a growth model for ULS.

.

4. Chapter 4 Logisticdevelopments in the future

4.1 Introduction

Society is constantly changing. Thebusiness world is also facing constantlychanging demands, both in the retail tradeand in industry. Transport and logistics arechanging along with these demands. Today,a clever combination of time, place andcapacity is crucial. Continuous, just-in-timedelivery in the right quantities is becomingmore and more important. It’s all aboutoffering quality and service at a competitiveprice. If UTP is to be an actual transportalternative, then it must meet the dynamicsand demands of the market.

4.2 ULS and logistic changes; a possible scenario

It is important to have a clear picture of themeaning of the expected developments inlogistics in goods transport. The goodstransport sector is constantly busyoptimising its product, such as throughefficient loading and utilisation. The retailsector is ahead of the other branches inlogistics. The reason is that the retail sectordeals with large volumes, daily frequencyand a large diversity of products. Recentdevelopments in the retail sector includeincreased competition and saturation of themarket; mass individualisation; increasedscale in production, distribution and theretail trade; increasing pressure for spaceand growing congestion.These developments in the retail market leadto certain logistics strategies and structureswhich are in progress: big retailers manage the control (supply

and distribution) of the physical flow ofgoods

the structure of distribution centres ofbig retailers consists of networks ofspecialised central distribution centresand regional distribution centres

as a result of an ever-widening range ofproducts, new product flows go from thesuppliers to the retailers’ distributioncentres. These product flows will have tobe delivered more and more frequently tothe retailers’ distribution centres. Directdelivery from supplier to shop branch is

consequently becoming a dyingphenomenon.

as a result of retailers’ increasingdemands regarding the frequency ofdelivery, more suppliers are going towork together and combine productflows, whether or not they use logisticsservice providers.

through increase in scale, greaterefficiency and increased monitoring,delivery times have been shortened andreliability of delivery has improved.

J.A. Vroom, Manager of Logistics Centre ofExpertise, Campina Melkunie“For Campina-Melkunie, logistics are extremelyimportant. In view of the limited shelf life of ourfresh products, it has always been important tous to work with low stocks, as well as to helpcustomers keep their stocks low through fast,frequent, reliable and acceptably priced deliveryto their distribution centres or stores. To makethis possible, we have built up a logisticsstructure which distinguishes us in today’smarket, but which is running into difficulties dueto increasing congestion on the road and otherfactors. We would therefore consider feasiblecost-effective alternatives for our ambientproducts; and with sufficient participation fromshippers in different markets with proper designfor efficient, cost-effective transhipmenttechnologies, ULS is a possible option.”

Shops are asking for an increasingly higherfrequency of delivery in decreasing volumes.As a consequence of expansion and mergersin the retail market, the number ofdistribution centres are expected todecrease. For the transport of goods, thismeans the following: The flows of goods willbe delivered directly to shops lessfrequently, but more frequently to retailers’distribution centres and will thereforeincrease in volume. Combining loads leadsto a reduction in the number of trunkingkilometres. However, the flows of goodsbeing delivered to the shops will be morefrequent and in smaller lorries. This canresult in a significant increase in the numberof road kilometres in the final stage ofdistribution, as well as higher transportcosts. Then, the access to cities will decline,whilst the burden on the environment andnuisance will increase. By combining loads

on the route from the producers to thedistribution centres, the number of roadkilometres will fall, but by much less thanthe increase arising from the final storedelivery.

A substantial majority of freight transporttakes place directly from shipper to receiver.In order to safeguard mobility, access andquality of life, a shift from direct roaddelivery to multi-modal freight networks inthe near future is a likely development.

The scenario outlined below could offer animportant contribution.

Multi-modality means that several modes oftransport are used, with transfer points inbetween. ULS fits within this multi-modalconcept. The transport of goods fromproduction to distribution centre or directlyto the end user, then shifts from direct roadtransport to a multi-modal transport network.A high-frequency network can look like aring network in the Randstad (urbanagglomeration) that connects the large citiesand a few large production and distributioncentres with each other. From centrallylocated junctions at the edge of the ring, therest of the Netherlands is accessible. In thecities, the “precise” user requirements oflocal distribution will have to be improved.

Figure: changes in logistics

The ring network would initially get startedwith the present modes of transport (roadtransport, train, inland shipping). It offersparticular opportunities for inland shipping.Inland shipping has such characteristics asreliable travelling time, low transport costs,environmental advantages and is verysuitable for regular large load flows. To thatend, a network of frequent ship departuresas part of an intelligent transport system isconceivable. This transport system will haveto develop into an intelligent network,

whereby all modalities connect with oneanother seamlessly.

The idea behind intelligent logistics systemsis to anticipate and satisfy as efficiently aspossible the wishes of the customer,through the sophisticated control andsteering of ordering, transport and storage.To realise this, information concerning thesale, supply and transport from the differentcompanies in the logistics chain must bepermanently connected via Electronic DataInterchange (EDI). This system will optimiseflows of transport by mode, route andfrequency. With its characteristic of regulardelivery in small quantities at exactly knowntimes, ULS fits perfectly into an intelligentlogistics system.

An intelligent and multi-modal network couldaccommodate more and more so-calledmoving supplies, whereby producers alreadyput their products into transport in thedirection of potential customers, and buyersorder from a supply which is already on theway to them. The advantages are that thestocks at the producers remain small, andthe delivery times are shortened. ULS-Aalsmeer-Schiphol-Hoofddorp, with aconnection to the international rail network,is a good example of such a multi-modal,internationally oriented transport network.Conditions for such multi-modal transportnetworks are that: the logistics supply chain managers will

direct the transport from producer to enduser

intelligent systems will be developedwhich can direct the goods within thenetwork

the transfer between the modalitiesproceeds automatically in order to lowerthe transport costs.

“Optimise integrated chains”D. van den Broek Humphreij, LL.M., GeneralDirector of the EVO, Employers Organisationfor logistics and transport“If, despite all possible usage measures, thecapacity of the infrastructure cannotaccommodate the growth of goods transport,expansion is an option. With this option, we seethe government as having the task of setting

priorities and making the right investmentdecisions. Of course, social trends must betaken into account which have an influence onthe course of goods transport, such ascompetitive developments on an internationalscale, mass individualisation, structural changesand developments in telecommunications. Webelieve that underground transport as part of thetransport chain can offer a real solution underspecific local circumstances, or as part of an(inter)national logistics concept. Multi- andintermodal transport fits into this chain approachand can offer an effective alternative to the lorry,provided the different modes of transport areintegrated within the relevant transport chains. Insuch a scenario, there should be the freedom tochoose shippers and/or a combination oftransport modalities on the basis of price andquality. The main point is that it should be basedon optimising integrated chains, and not strivingfor an optimal system for each separateelement; in other words, underground transportshould be recognised as part of the chain.”

ULS has the characteristics that link up withexpected logistics developments. Indeed, itcomes close to the ideal of providing acontinuous supply to shops. To sum up, wecan say that this scenario comprises manystimulating ideas, and it is on that basis thatthe possibilities for policy will be examined.A diverse group of business people isclosely involved as a “sounding board”. Theabove concepts will also be tested throughmarket analysis. Other components are alsobeing applied. The “dal-distribution”(restocking of large retail outlets during off-peak periods) concept in the Randstad is aninitiative of GOVERA (Goods Transport inthe Randstand) and CBL (Central Agency forthe Food Product Trade).

4.3 Traditional pipeline transport and logistic changes; apossible scenario

Ideas on traditional pipelines are also takinginnovative turns. Pipelines have always beenused for the transport of large quantities ofindustrial (basic) products. Besides gas andwater, traditional pipeline systems alsotransport crude oil, petroleum products andraw materials and intermediates from thechemical industry. Enormous growth inflows of raw materials through pipelines isnot expected. The innovative idea concerns

using the pipe as a strategic means oflowering the production costs: the collectiveuse of pipelines (common carrier) and thedevelopment of new concepts, such as usingthe pipe for CO2 reduction and combiningsmall flows in specially constructedfacilities. If the traditional pipe is furtherdeveloped in this way, it will contribute tocabinet policy regarding separatingeconomic growth from the burden on theenvironment.

S. de Bree, B.Sc., Chairman of the Board ofDirectors of DSM“The chemical industry in Northwestern Europeis finding itself at an important crossroads. Nowis the time to take advantage of the momentumand make the right choices for the future. Ahighly competitive petrochemical sector on aworld scale requires that we join hands inEurope. This means working together towardcontinued improvement of the logisticsinfrastructure, and of the pipeline networkbetween different production locations. DSM istaking up the challenge to improve the positionof our sector worldwide. Through developmentstaking place on a worldwide scale, we see thatthe international problem goes beyond the scopeof the business world. The government and thechemical industry will have to put their headstogether to seek collective solutions. This willrequire international co-operation.”

The following scenario would promote thedevelopment of these innovative concepts.

The chemical industry in North-westernEurope plays an important role in the worldmarket. 35% of world sales are generated inEurope. Major efforts are needed to maintainthat position, particularly in cost control.The competitive position of the chemicalindustry is at stake due to competition fromthe other continents and other factors. Lowcost prices elsewhere due to low wages,joint ventures and large production unitsalso play a role. In short, cost control isneeded. Co-operation within the businesscommunity is a precondition for maintainingthe competitive position of the chemicalindustry in North-western Europe.

The production of relatively small quantitiesof raw materials (such as propylene) at

various locations is expensive, and transportwith a different modality to the pipeline isnot justified. A new vision of co-operation iscirculating within the business community.Support for this idea is growing within thechemical industry. An important element isto connect the industry clusters in North-western Europe via generally accessiblepipeline networks for the transport of liquidsand gases for the petrochemical sector. Thisintegration of pipeline networks leads tooptimisation of transport and logistics, aswell as production.By connecting the processing andproduction sectors with each other viapipelines, large-scale production units forraw materials can be built along the pipelinenetwork. The locations where the productsare processed will remain the same.The objective of this scenario is to create apropylene pipeline network in the Beneluxand Germany for the growing market ofpolypropylene, a raw material for plastics.The greater part of the infrastructure for thisnetwork already exists. However, the variouspipelines are not connected with each other.For propylene, for example, a crucial part ismissing to connect Belgium and theNetherlands with Germany, and for ethylene,to make the connection with Delfzijl. Thecompletion of networks is essential forstrengthening the chemical industry, andwith it, the economic competitive position ofNorth-western Europe. The sector is of theopinion that without governmentparticipation, it will be very difficult to realisethese plans.

For CO2, hydrogen, oxygen, nitrogen, andother products whose quality is easy tocontrol, it is also important to formnetworks.

A new development aimed at sustainability(and day-night buffering in pipelines) is thetransport and storage of CO2. A few energydistribution companies have recently studiedthe feasibility of transporting CO2 that isreleased from industrial installations. Bystopping the emission of CO2 into theatmosphere and instead supplying it toglasshouse horticulture, a win-win situationis created for all parties involved. Solutionsare also being sought for transporting

industrial residual heat via pipelines tocustomers.

The chemical sector no longer considers thetransport, management and maintenance ofthe pipelines as core business. Eventually,following other industry sectors, thetransport will be contracted out, in this caseto specialised pipeline transport companies.But before it can get that far, the culturemust change: people must let go of the ideathat a pipeline is for individual use only.Collective use (common carrier) must gainacceptance.

To summarise, we believe that this scenarioembraces stimulating ideas. However,implementation is still far from reality. Someconditions, for both the business world andthe government, have not yet been met.

4.4 How can these scenarios become reality?

First of all, the results of the feasibilitystudies must be tested against the scenariosoutlined above. It goes without saying thatthe insights and experiences of the marketare extremely important. The parties involvedmust be able to identify with them. A secondimportant question is whether the theorycorrelates with practice. To find out, pilotprojects must be carried out.

5. Chapter 5 Co-operation to getresults

5.1 Introduction

In this chapter the first results of thefeasibility studies are presented and theprogress of the research programme isdescribed.In order to explore the possibilities of ULSfor cities, regions or industrial areas,feasibility studies for a few pilot projectshave been conducted or are in progress.Urban distribution studies were focused onUtrecht and Leiden; regional distribution onthe ULS Junction Arnhem/Nijmegen scheme,and the industrial application is ULS SouthLimburg. The feasibility studies fall underthe responsibility of the involved (market)

parties, but IUTTF supervises and providesfinancial support.The feasibility study aimed at urbandistribution, ULS Tilburg, will begin soon.

5.2 Feasibility studies

5.2.1 ULS UtrechtThe city of Utrecht is seeking new ideas forkeeping the city accessible and congenial forpeople to live – especially in the historictown centre. A project with the goal ofimproving the regional functionality of thetown centre is the Utrecht Centre Project(UCP). Utrecht is also on the threshold ofmajor infrastructural changes, such asdoubling the railway and the construction ofhouses and offices in Leidsche Rijn, the newhousing development currently in progress.Within this framework, the city has taken theinitiative to conduct a feasibility study: ULSUtrecht. The inquiry focused on flows ofgoods to and from the town centre. LeidscheRijn can also be connected to a pipeline andis therefore part of the study.The inquiry has several approaches. Thegovernment-related approach of“infrastructure” and the private approach of“service/entrepreneurship” are equal, as arethe “transport technology” and “logistics”approaches. A Utrecht ULS can only truly bean alternative if solutions are found for allfour approaches and how they interconnect.

An inventory of the flows of goods showsthat an average of 38,500 shipping units aretransported to the Utrecht centre. In 2010this number will increase to 80,300 units.The packaging consists mostly of boxes,crates and barrels (75%); only a small partare roll containers and hanging garments.But it is this last category that takes up alarge part of the volume (m3) transported:50% of the volume consists of hanginggarments. In terms of logistics, the predictedflows of goods provide a sufficient basis fora Utrecht ULS, especially in view of theexpected growth of UCP.

Loading units in urban distribution inUtrecht; Source DVH, 1999

C.O.D.

Too large

Large boxes/crates/Barrels

Climate-controlled

Small packages

Present

To calculate the technical side of theunderground system, two variations werestudied: a system with a pipe diameter ofone metre through which packages andpossibly clothing (not hanging) can betransported. The pipe system then accountsfor about 36% of the supply. The othervariation is based on a pipe diameter of 2metres, suitable for transporting rollcontainers and hanging garments. This mostclosely matches the current method ofpacking. This pipe can transport 75% of thebusiness requirements.

To determine the location of a transfer centreat the edge of the city, the source of thepresent flow of goods was used as a basis.Three potential locations were examined, alllocated on the west side of the city. Fromthose points, roughly six kilometres ofpipeline are needed to supply the towncentre and Leidsche Rijn. The investmentsfor laying a double pipe system, one transferpoint, three outlets in the centre, one outletin Leidsche Rijn, vehicles and controlsystems, are estimated at about 200 millionguilders. Although account must be taken ofinitial losses, profitable operation seemspossible. Discussions on this subject werealso held with various parties in the Utrechtregion. A rough calculation of the costs wasalso made.

For an Utrecht ULS, Public PrivatePartnership (PPP) is a possibility. This iswhy it is necessary to gain an understandingof various parties’ interests regardingtransport to and from the town centre.Discussions on this subject were held withUCP partners, property developers, financialinstitutions, producers, transporters,shippers and shopkeepers. Large

shopkeepers in particular consider theflexibility of USL to offer the advantage of nomore delivery time- window periods and anattractive, clean and liveable city for theconsumer. Shopkeepers sometimes showlittle interest in logistics optimisation,however. The exhibition centre showedinterest as a potential client of ULS and isthinking specifically of catering supplies.

Important insights gained from the studyinclude:

A Utrecht ULS is feasible under certainconditions. In view of the nature andscope of the flows of goods, and thetechnical and infrastructuralpossibilities, a Utrecht ULS seemsfeasible. This must be conditional oncost (no more expensive for thecustomer), PPP-structures, planning inphases (forming a judgement andsupport) and establishing the ULS withina national approach.

The discussions revealed that customersstipulated that the transport must not bemore expensive than what wouldotherwise be paid. If the quality of theservice is better, then a premium mightbe paid.

In order to work out a PPP agreement,participation by private parties in theearly stages is crucial. During theinquiry, a number of parties indicatedtheir willingness to contribute towards orto participate in a possible follow-upphase.

Migration of the present transport systemto a Utrecht ULS can only succeed ifthere is enough co-operation andstimulation at national level to provide aframework for similar developments inother cities.

5.2.1 ULS Leiden

In order to revitalise the city of Leideneconomically, the Leiden town centre isundergoing a major facelift. New projects areneeded to maintain the improving trendwhich began in 1995. The City Council wantsto carry out a feasibility study to determinewhether underground transport is consistentwith the objectives of keeping the town

centre - and the metropolitan area - liveableand accessible for both passenger andgoods transport. The structure of the towncentre necessitates serious consideration ofnew logistics concepts which are attuned tothe specific characteristics of the historictown centre.An important point of departure for the studyis that Leiden ULS must be linked to theexisting modes of transport via a multi-modal distribution centre.

The size of the transport volume suitable forcarriage by ULS is roughly 7000 m2 per weekfor the town centre, and 23,000 m2 for Leidenas a whole. The packaging units consist ofsingle boxes and crates (8%), hanginggarments (13%), roll containers (29%) andpallets (49%). The likelihood of loading unitschanging back to boxes and crates in thesupply chains in the short term is small. Inorder to maintain a connection with existingsystems, loading units like roll containersand pallets are desirable.Talks with future users confirm thissituation.

System elements of a Leiden ULS include alogistics city park (multi-modal distributioncentre) and local terminals (centralloading/unloading points of an ULS).A number of potential locations for alogistics city park for Leiden have beenexamined. A combined connection of aLogistics City Park to rail and motorwayroutes at the edge of the city is not possible.However, separate connections to motorwayand railway are possible. The connectingline between the unimodal distributioncentres can run through the town centre.Expansion of the system to Heineken inZoeterwoude and various distributioncompanies in Alphen a/d Rijn is a realisticpossibility.On the basis of current information, theconstruction and planning of a Leiden ULSwould require an investment of over 100million guilders.

A tunnel/pipeline diameter of over twometres was chosen for the system in order tocarry roll containers and pallets. This choicewas partly based on the opinions of thecompanies interviewed. The transport

system in the pipeline will operate withautomatically guided vehicles. Efforts arenow being made to optimise this technology.On the basis of the present flows of goods,the transport system in the tube would beabout 25% utilised. With the expected growthin the flow of goods and normal peakexpectations, utilisation of about 80% isexpected during busy times.

Important insights gained from the studyinclude:

Further study of a Leiden ULS isrecommended.

The chances of achieving a profitableoperation seem to depend on thepossible development of rail distributionas part of a national multi-modalnetwork. It seems reasonable to expectthat the benefits of an urban distributionnetwork alone are not sufficient. Thegreat financial advantages of a ULS willnot be fully utilised until the distributionand production centres are alsoconnected with the network.

A separation of management andoperation, similar to ULS-ASH, seemsdesirable. A combination of tasks canfacilitate the introduction andacceptance. Possible PPP (Public-privatePartnership) structures have not yet beenexplored.

The interests of the separate parties andcompanies have been surveyed andexplored in a first round of talks. Anumber of companies expect that ULSsystems are sure to come, but about thesame number of companies are scepticalabout the chances of a ULS, particularlyfor delivery services. Companies in theretail and transport sectors are the mostsceptical.

People see the most importantopportunities for ULS in improvedaccess to shops and businesses in thecities, and reduced kilometres indistribution from supplier to distributioncentre, if the ULS is connected to anational network. A possible objectionwas mentioned: that logistics serviceproviders and retailers do not (as yet)like the idea of being part of a neutralmulti-modal national network in which

their own distribution centre is left out ofthe supply chain. For a ULS in Leiden,this means that the logistics city parkforms an extra open transshipment point,with the accompanying extra costs.

5.2.3 ULS Junction Arnhem/Nijmegen

The Arnhem/Nijmegen region is devoted to amore sustainable style of managing goodstransport in the future. Within thisframework, an exploratory study of thepossibilities for an Underground LogisticSystem (ULS) was conducted in the JAN(Arnhem/Nijmegen Junction) region.The town centres of Arnhem and Nijmegenboth generate about 10,000 deliveries perweek with a transported volume of 15,000 m2.60 to 80% of this amount is suitable fortransport via a ULS.

In working out the network for urbandistribution, two basic alternatives can bedistinguished. With network A, the towncentres of Arnhem and Nijmegen will beopened up via one centrally locatedLogistics City Park (LCP) on the MTCValburg, or in the immediate vicinity. Thenetwork length is 22 km aboveground and5.25 km underground. The costs of theinfrastructure are estimated at roughly 250 to300 million guilders. With network B, thetown centres of Arnhem and Nijmegen areopened up separately (4.5 km abovegroundand 7.5 underground). The costs of theinfrastructure for network B are estimated atabout 220 to 280 million guilders.

The costs of operating a ULS vary from 10 to40 guilders per m3. But these amounts mustbe interpreted with caution. If a nationallogistics network is not realised, then thelogistics costs for business owners will rise;but if combined with a national network, aULS can have a positive impact on businesseconomics.

Opening up the town centres of Arnhem andNijmegen via ULS will have a limited effecton decreasing congestion in the region. Theproportion of lorry traffic on the maintransport axes is too small for that. But theintroduction of a ULS can lead to aconsiderable decrease in the number of

lorries in both town centres. This means thatthe environmental effects of the ULS are notso much in the reduction of emissions, butrather the improvement of the environmentalquality in the town centres. A decrease ofsome 1000 lorries per day per town centre(two-thirds) leads to a considerable decreaseof certain emissions at a local level.

The added value of a ULS can be enhancedby expanding the ULS network into aregional network. This will be the case ifregional business estates and high qualitytransport infrastructure junctions alsobecome a part of it. On the basis of thepresent flow of goods, such a network doesnot (yet) seem to justify itself, but in view ofthe intrinsic potential of a ULS, it maybecome a realistic possibility. This potentialwill come from the development of a new,high quality logistics organisation, and froman optimal opening up of MTC Valburg andthe HSL station for the regional businesscommunity.

Important aspects of the study are: The conclusion that a ULS in the JAN

area provides many logistics and socialbenefits. Combining flows of goodsleads to a reduction in the total costs inthe logistics chain. Access to the towncentre improves, and there is lesspressure on the environment becausethe number of lorry kilometresdecreases.

A precondition for the regional networkis a national logistics network. Thestudies show that without a nationalnetwork, a ULS in the JAN region willlead to extra logistics costs forcompanies. Nor can any positive effectson the number of lorry kilometres beexpected. Important social benefits canbe gained from a regional network,especially when combined with anational logistics network.

It is advisable to start experimenting withcombining the flows of goods into thetown centres of Arnhem and Nijmegen atregional industrial estates. Theseexperiments are a step for ULS-JAN anddo not have to be sought immediately incombination with a ULS. It is the lesscostly opportunities that offer benefits

from combining collections anddeliveries in the very short term. Theadvantages lie in the reduction of lorrykilometres and improvement of theenvironmental quality. A characteristic ofthese experiments is that together withthe business community, they arestriving toward combining the flows ofgoods, which can have both logisticsand social advantages.

Without support from the businesscommunity, a ULS cannot be realised.ULS-JAN was initiated by the Chamber ofCommerce, which acts as intermediarybetween the government and thebusiness community, and particularlypromotes entrepreneurs’ viewpoints andinnovative ideas.

It is very important that regional andmunicipal governments create favourableconditions which will anticipate andfacilitate the development of a ULSsystem in the near future. This pointmust be specially considered in makingthe correct short term investmentdecisions. This particularly concernsprojects aimed at restructuring towncentres and investments in road, rail andmulti-modal infrastructure. Linking theWychen-Zevenaar lightrail connectionwith the ULS merits special attention.The assignment is to search foropportunities to integrate passenger-and goods transport into one system.

5.2.4 South Limburg ULS

In April 1998 a preliminary study wasconducted to examine where theopportunities for a ULS in South Limburgwould lie. The reason for the study relates tothe industrial development in this regionwhich has led to the rapid growth of roadtransport over short and long distances.The aim of a ULS is to offer the affiliatedcompanies an infrastructure which canfacilitate the step towards inter-modaltransport and inland shipping, promoteregional development, reduce the burden onthe environment, reduce congestion andcreate more room for a business’ own coreactivities. The first results indicated that aULS in South Limburg would be likely tosucceed.

The first phase of a ULS in South Limburgstarted with a feasibility study of optimisingthe transport of granulates frompolypropylene and polyethylene from DSM inGeleen to the customer. For DSM, theimportant objectives are a reduction of theirtotal logistics costs and to increase safetyand environmental quality in and around theproduction location. One of the instrumentsfor achieving this is by increasing the shareof intermodal transport. For DSM a modalshift is important for reducing the burden onthe (road) infrastructure and theenvironment, particularly long-distancetransport; improving the reliability andplanning of deliveries thanks to additionalwater and rail capacity; improvingaccessibility at and around the DSM locationin Geleen. A precondition is that the logisticscosts for DSM may not increase. For DSM,logistics are an important success factor, butnot a core activity. The first part of a SouthLimburg ULS involves a route roughly 1 kmlong on DSM land, between the DSMwarehouses at Geleen and the DSM Mauritsrailway yard.

The analysis of transport flows (for theperiod 1998 to 2010) focused on the integralhandling of goods from the factory to thecustomer: i.e. type of packaging (maximumin bulk containers), logistics process at theDSM location and at the customers’,organisation of storage and transport, andfuture developments in transport.The results of the transport analysis arebased on the following assumptions: amodal shift will eventually be economicallyadvantageous for distances greater than 400km; in 2004 DSM wants to put new factoriesfor polyethylene and polypropylene intooperation; and two more new factories willbe in operation before 2010. Transport isexpected to grow from 1.29 million tons in1998 to 2.58 million tons in 2010. With nochange in policy, in 2010 only 20% will beintermodal (train and ship) and 80% by lorry,which amounts to roughly 220,000movements by lorry. With a maximum modalshift, over 55% will be intermodal in 2010,and only 97,000 transports will be made bylorry.

Continuing expansion – as a consequence ofa larger European market and increasingcompetition (worldwide as well) – also leadsto changes in logistics. The transport ofplastics via container will become moreprevalent. The analysis of flows of transportwas based on the assumption that DSM willtransport roughly 80% of the plastics incontainers in 2010.

Four variations for transport from theproduction location in Geleen to the Mauritsrailway yard were examined: transport bylorry; transport by Multi-Trailer System(MTS); transport by automatically guidedvehicles (partially underground); transportby automatically guided vehicles via a ULS(totally underground). An analysis oftransport costs showed that from a logisticsviewpoint, large containers as a standardload unit are the best solution for DSM. Forthe time being, transport via a ULS does notseem feasible from an economic viewpoint.

Taking into account the possibilities andlimitations (such as the existing railinfrastructure, DSM safety requirements,distance to external buildings), threevariations for the railway yard at the DSMMaurits location were examined.

Depending on the choice of transportvariation combined with a variation for therailway yard, the investments will come tosomewhere between 155 and 265 millionguilders. The operating costs of thevariations vary from 25 to 35 million guildersper year.These are rough estimates which must becritically examined. These cost componentsare still the subject of discussion.

Important insights gained from the study are:

It is possible to cut in half the number oflorry movements through optimisation ofproduction, transport and logistics.

Despite the favourable infrastructurallocation of the DSM site (connection toNS rail, own railway yard at Maurits,nearby connection to water transport),the investments for all transportvariations studied are (too) high forsound business-economic operation.

An initial selection will be made on thebasis of integral considerations. This willrequire further optimisation and detailedplanning.

Various PPP (private-public partnership)structures are conceivable; thesealternative financial structures must befurther explored.

DSM is starting a few trials to test thepracticality of different options for modalshift with a view to the integration ofroad, rail and inland shipping.

5.2.5 Preliminary conclusions from ULS feasibility studies

A few preliminary conclusions can be drawnfrom the first results of the feasibilitystudies. It must be emphasised that theyreflect various developing ideas. The resultsmust be interpreted with caution.

Goods transportAn urban ULS can theoretically handle amarket share of 50 to 70 percent of thecurrent tonnage destined for the towncentre. This means a significant substitutionof a more environmentally friendly mode oftransport. Crucial for the success of a ULS isoptimisation of transport for collection anddelivery, optimisation of the logisticssupport, and a competitive price. Without anunderlying intermodal network, however, theeffect on total goods transport is limited.South Limburg ULS has considerablepotential for a shift in the choice of modes oftransport. But the costs are high.

Investment costsThe investment costs for a ULS are (very)high. Without (financial) participation fromthe government, a viable ULS does not seemfeasible. In any case, the transport andlogistics costs of the chain as a whole mustbe reduced. Examples for achieving thisinclude:- making the transport system moreintelligent, reducing transhipment costs,setting up the logistics chain differently andsetting up a well-connected intermodalnetwork. Due to the high costs, a nationwideULS network is not under discussion for theimmediate future.

Accessibility and environment

Underground logistics systems in an urbanenvironment considerably improve theaccessibility of the city for goods transport.The vitality and environmental qualityimprove as well. Because of the smallproportion of urban goods using themotorways the effect on motorwayl gridlocksis limited, unless an intermodal connectingnetwork is created at the same time.

W.J. van Grondelle, B.Sc., Nature andEnvironment Foundation“Underground transport offers interestingopportunities for more environmentally friendlytransport, so it deserves support. It is not apanacea for all problems, however. Just bringinggrowing goods transport underground does notin itself lead to sustainability. We suggest placingthe emphasis differently. Urban distribution is acrucial point, a measure that is of essentialimportance in both the short term and themedium-long term. First aboveground, and later,when advisable, underground.”

Support and organisationSupport for underground transport isstarting to grow among the businesscommunity, citizens and government. But forULS to succeed, participation from marketplayers and regional governments is anessential requirement. On the basis of theresults of the feasibility studies, Utrecht andLeiden have given the first indication thatthey want to proceed to the next phase.However,the organisation of a ULS will be acomplex matter due to the many parties andinterests who will need to be involved.

5.3 ULS draft studies

5.3.1 Rough draft Aalsmeer-Schiphol-Hoofddorp

In order to keep the European supply andtransport markets accessible in the future,excellent railway services for the transport ofhigh-quality and time-critical goods iscrucial. ULS forms a reliable link between theexisting modes of transport – road, air andrail. In the spring of 1998 an exploratorystudy was conducted on the transportproblems in the Schiphol area and possiblesolutions proposed. A comparison wasmade between:

doubling N201 (adapt and expand theexisting infrastructure south of theairport, including new construction)

building dedicated lanes restoring the old railway connection

Hoofddorp-Aalsmeer Flower Auction realising the ULS in combination with a

quality railway product.This study shows that from a strategic, long-term point of view, the ULS is the mostdesirable and economically feasible option.

The ULS-ASH project is at the end of therough draft phase. Preliminary designs arebeing drawn up for the necessary tunnelinfrastructure, the transport andtranshipment systems, and the automaticguided vehicles (AGV) prototypes are beingmanufactured. The management andoperational structures and the form of thefunding arrangements are also being workedout in detail. With respect to the planningapplications, routes for the regional planningand zoning plans are being evaluated and anEnvironmental Impact Report is being drawnup.

For Amsterdam’s Schiphol Airport and theAalsmeer Flower Auction, accessibility isvital. Time-critical goods - flowers and plantproducts, air freight and “fresh” products)need a high-quality, sustainable alternativeto road transport which can guaranteeaccessibility around Schiphol and Aalsmeerand provide the connections with thehinterland. This alternative consists of anetwork of quality railway transport inEurope (HST) and a connecting link fromSchiphol and Aalsmeer with the railway via aULS. The load units and the load carriers ofthe ULS must connect with the internationaland intercontinental transport chains, andthe transfer between the transport modes(ULS, rail and road transport) must occur“quickly and quietly”. This system strives tomake a substantial substitution from road torail so that the transport times of 10 to 15years ago will once again be feasible, andgrowth in business for the coming decadescan be effectively accommodated.

The ULS can fulfil several functions. First ofall, it can take care of regional transportrequirements between Schiphol, Aalsmeer

and Hoofddorp. At the airport the ULS cantransport goods between the various airfreight handlers, shippers and transportersbecause freight warehouses will beconnected directly to the system. Eventually,we must explore under what conditions thistransport can be extended from the platformto the aeroplane. In the immediate vicinity ofthe rail terminal, an area could be reservedfor high-quality logistics activity. The ULSwould cross this area and could providequality product specific distribution in thisarea, if the businesses are “connected”.

Goods transport by high-speed train offers ahigh-quality and reliable future alternative toroad transport. The high speed can alsooffer room for new, perhaps as yet unknownactivities which will add value.The ULS will provide an undisturbedconnection between Aalsmeer FlowerAuction and Schiphol Airport with therailway network and makes possible anintegrated, just-in-time delivery service withhigh turnover rates and low stocks.

The ULS network consists of a network ofbored tunnel tubes, cuttings and a fewpipeline sections constructed at groundlevel. The total length of the ULS will beroughly 13 km, of which a portion (50%) willbe a double track. The tunnels will have aninternal diameter of 5 metres. A terminal willbe built near Hoofddorp to connect with therailway. At Schiphol Airport the choice mustbe made between providing two terminals(with supplementary transport) or makingdirect connections at business level so thatinternal transport can also alternate via theULS. Finally, at the flower auction a terminalis planned with a connection to the internaltransport system there.

(caption with diagram)Preferred trajectory ULS-ASH

ULS and rail are intended to help protect andreinforce the position of the regionaleconomy by providing effective and reliablefuture connections with the hinterland.

Particularly the integrated use of high-qualitymodalities such as underground transportand high-speed rail transport will restore theregion’s leading position and can give a newimpulse to NDL’s (Netherlands DistributionLand) role in serving worldwide operatingcompanies. The ULS will help reduce thelocal congestion problem and temporarilyreduce the pressure to further expand theroad infrastructure and defer thoseinvestments to a later date. Through multipleuse of space (underground pipeline system),additional criss-cross infrastructure can beavoided. This benefits the safety and qualityof life of the already heavily burdenedregion. As an environmentally friendlyalternative, ULS and rail are preferred to theexisting modality of road transport and canactually bring about a substitution. Thenecessary energy can be produced in a moreenvironmentally friendly manner, andharmful emissions can be reduced. Finally,as a pilot project and initial experiment forunderground transport, the ULS offers anexcellent opportunity to develop knowledgeand to bring this knowledge into actualpractice. The project is innovative in thefollowing areas: Industrial underground construction of

tunnel systems. Transport systems with computer-

controlled and unmanned vehicles. Distribution concepts which make use of

the modalities of air, rail, pipeline androad.

Concepts for high quality urbandistribution in the freight areas ofSchiphol.

Planning for the integration, operationand management of pipeline transportsystems.

The developed knowledge will then begenerically applicable to other initiatives andcan strengthen the export position of Dutchknow-how.

For the ULS-ASH, the management andoperation of the infrastructure will be splitup. The construction and maintenancemanagement will be brought under BuisInfra Beheer (Pipeline Infra Management –BIB). The operation – installing andoperating the ULS system - will take placethrough the Exploitatie Maatschappij OLS (

EMOLS - Operation Company ULS). Theinvestment costs for BIB (civil infrastructurefor pipeline and loading and unloadingpoints) are estimated at over 500 millionguilders. The investment costs for EMOLS(operating system, energy andcommunication facilities, vehicles andstorage space for vehicles) are estimated atalmost 150 million.

The reduction of emissions from airpollutants2 was quantified on the basis of anestimate. This social environmental benefitwas calculated at 0.1% (0.4 million guildersper year). In its investment decisions forinfrastructural projects, the governmentmaintains a benefit requirement of 4%(including social benefits).

Through workshops and personalconversations, the wishes, requirements andany objections of the parties involved will beidentified. In combination with the newrailway product, ULS-ASH must ultimately becompetitive with road transport. Recentlyheld sessions with potential users haveboosted support.ULS-ASH is working hard towards jointpublic-private financing. A few consortiahave shown interest in the construction,financing and operation of the ULS. Inaddition, other private parties are activelybeing sought who can play a role in themanagement and operation of ULS.

Substituting road transport with the railwayis forcefully mentioned in the “Planning CoreDecision on Schiphol and Environs”. Inorder to realise this, a ULS is necessary. ULScan become integrated into the logisticsprocesses of the flower auction and theairport. When the ULS is used as an intra-airport system, it will save about 35 millionguilders annually.

5.4 Feasibility studies Traditional Pipelines

2 Various studies discuss the social costs whichcan be associated with these emissions. Sincethere is no real market for environmentaleffects, the estimates in these studies varysignificantly. An average estimate was used inthis case.

5.4.1 Propylene network

In order to maintain but also strengthen thecompetitive position of the chemical sectorin Northwestern Europe, DSM, together withthe Dutch government and internationalpartners, initiated a feasibility study on thedesirability of completing the propylenenetwork in North-western Europe. Thechemical sector in Europe plays animportant role in the world market – 35% ofthe world turnover is generated in Europe.The study concerns the missing link in thepropylene network between Belgium, theNetherlands and Germany. This integrationof pipeline networks would lead tooptimisation of transport, logistics andproduction. The most important objective ofexpanding the network is to guarantee thesupply of propylene (a basic raw material) atcompetitive prices. This is of greatimportance to the international competitiveposition of the petrochemical industry.Strong growth is expected in propyleneconsumption until 2010. The study mustshow whether, and if so, how the propylenenetwork can be responsibly expanded whilealso connecting the different chemicalclusters in North-western Europe with eachother. The study compares the constructionof the network with other transportpossibilities (rail and shipping). On the basisof different economic scenarios, an analysisis being made of expected propylene flows.Various routes are being studied, as well asthe possibilities of network expansion. Thestudy also includes a business-economicand social analysis. All scenarios take intoaccount strong growth in propylene flows;for some routes, this leads to a doubling oreven a quintupling of the expected flows. Onthe basis of a business plan expected in theautumn, the expansion of the propylenenetwork in the Netherlands must beexamined to see if it can be profitable andwho will fund the investments. Opportunitiesin private-public co-operation will beexplicitly taken into consideration.

“Most of it is already in the pipeline”D.A. Schuddebeurs, Association of theChemical Industry (VNCI)

“For the chemical industry, the conditions forestablishing a business and the transportfacilities are inextricably bound to each other. Inorder to transport large volumes of liquids andgases safely and quickly, it is profitable to makeuse of pipelines. Putting in pipelines as a meansof reducing transport costs appeals to us. Weare eager to consider new solutions for reducingthe problem of congestion, for example. Wehave experience and expertise in undergroundtransport. For the further expansion of thepresent underground infrastructure, we see aclear role for the government: facilitate, stimulateand co-ordinate. The government can see to itthat the pipeline will have the status ofinfrastructure. And with the government’sconcern for physical planning, it can reservefunds for future pipeline routes. As VNCI, we arevery happy with the broad co-operation betweenthe Ministries of Transport, Public Works andWater Management; Economic Affairs; andHousing, Physical Planning and theEnvironment. It goes without saying that activeinvolvement from the business community isessential”.

5.4.2 Ethylene pipeline to the North

In order to give Northern Netherlands aneconomic impulse (Langman Commission),plans were developed for laying an ethyleneline to Delfzijl (a contribution has beenprovisionally reserved from ICES funds forpossible construction). The metal andchemical industries of Northern Netherlandswill receive a new impetus if they areconnected to the international ethylenepipeline network that connects Germany,Limburg, Rotterdam and Belgium together.The soil of Groningen contains roughly 1.5million cubic metres of magnesium salt.Magnesium salt can be processed into metal.A worldwide shortage of magnesium metal isexpected around 2005, so there is a marketfor it. The processing capacity for the by-product chlorine that comes from theproduction of magnesium metal frommagnesium salt must be expanded. Thepresent chlorine processing capacity inNorthern Netherlands is insufficient.Ethylene, which is needed to process thesurplus chlorine, can be supplied by pipelinefrom Geisenkirchen (Germany), Geleen orRotterdam. An advantage of local processingof each surplus of chlorine in the North is

that chlorine transport by train betweenRotterdam and Delfzijl can probably beterminated. Various aspects of ethylenetransport to Delfzijl will be considered in thisstudy, particularly the economic, pipeline-technical, environmental, legal and externalsafety aspects.

A condition for the success of setting up amagnesium industry cluster in the Delfzijlarea is the proper capacity to process the by-product chlorine. Part of the studycomprises a global comparison of ethylenetransport alternatives other than via apipeline (i.e. road, rail, inland shipping, sea).Transport by road is not an option due to thecosts. Rail transport is only possible forlimited quantities, and, according to thesector, transport via inland shipping doesnot exist (yet) because of the relatively largespace that a cooling system would take upon an inland vessel. Pipelines are suitablefrom both a technical and economic point ofview. Supplying ethylene by sea is alsotechnically and economically possible.

The first preliminary results show that amagnesium factory is independentlyeconomically feasible with a production of80,000 tons per year. In order to process the240,000 tons of chlorine set free during thisproduction, roughly 90,000 tons of ethyleneare needed. However, as an independentcomponent, a pipeline is only profitableabove 180,000 tons per year. This means thata processing industry must be sought for the“ethylene surplus”. Another possibility is tochoose a different (more limited) method ofsupplying ethylene.The construction problems will probably notbe insurmountable.

Another subject of study is the possibilitythat the magnesium factory can develop intoa magnesium cluster. The results of theeconomic considerations will be available inthe fall. On the basis of the informationwhich will then be available, it will beexamined whether further study isnecessary, after which a decision will bemade with regard to the ethylene pipeline.

5.4.3 Multi-Core Pipeline

Multi-Core is one of the new organisationalconcepts for making the introduction ofpipeline transport more attractive . Thisconcept was developed by the MunicipalPort Installation of Rotterdam. If several(about eight) pipes are laid in one tunnel, theconstruction costs decrease considerably.Then the transport of small amounts ofliquid or gaseous chemicals throughpipelines can be made profitable. Animportant factor here is to generate interestamong potentially interested parties and/orinvestors and to bring them together.This costs time and indirectly poses a risk tothe Municipal Port Installation of Rotterdam.Given the infrastructural developments inthe port region and the fact that space isbecoming scarcer both above and belowground, taking such a risk for the MPIR isacceptable. Transport through pipelines isrelatively cheaper and more sustainable.Since CO2 emissions decrease if moreproducts are transported by pipeline andless by road or water, an appeal was madefor subsidy monies from the CO2 reductionplan. The CO2 reduction plan steeringcommittee recently gave a positive reactionto the request for the first phase. TheMunicipal Port Installation of Rotterdam willdecide in the autumn whether investmentswill be made. With a positive decision, thework can start at the end of 1999.

5.4.4 Pipeline network for CO2 distribution togreenhouse gardeners

CO2 supply for glasshouse horticulture takesplace both winter and summer by means ofburning gas. In the summer, this results inreleased heat, whilst in the winter period, inwasted energy. By sending CO2 to thegreenhouses from other sources, the so-called summer stoking can be avoided. Thetotal greenhouse area makes a saving ofroughly 2 million tons of CO2 possible overthe long term. If CO2 buffering undergroundbecomes technically possible, a saving of upto 4 million tons of CO2 can be realised peryear. In the Climate Policy ImplementationMemo, 25 million guilders have beenallocated for research on this subject.Pure and impure CO2 are available fromindustrial installations which often emitconsiderable quantities to atmosphere. A

pure CO2 source is the Shell PER+ plant (1million tons per year), for example. Ammoniafactories emit pure CO2. This CO2 can bedistributed directly to the greenhousegardeners in the Westland, Delfland andOost-Voorne via a pipeline network. ImpureCO2 sources can also be used.Separation techniques can purify CO2, whichis then led onward to the greenhousegardeners. The Optimisation of Recyclingand Exergetic Processes Company (OKEP inDutch), a co-operation of three powercompanies, has worked out a plan to deliverthe CO2 from the SHELL PER+ plant togreenhouse gardeners and has applied for asubsidy for it. This application was funded inprinciple with a subsidy of 39,000,000guilders within the framework of the decreeon subsidies for the CO2 Reduction Plan.OKEP is expected to make an investmentdecision at the end of 1999.A similar project is the delivery of CO2 andresidual heat by an energy distributioncompany to a new greenhouse horticulturalarea. This project was also funded(30,000,000 guilders in principle) via the CO2Reduction Plan.At the same time, the power companies areactively looking for underutilised pipelinesfor the construction of a (national,eventually) distribution network for CO2. Anextensive feasibility study has beencompleted for a large, undeveloped pipeline,with positive results. This line can also serveas a CO2 day/night buffer. To connect theimpure CO2 sources to the distributionnetwork, a CO2 line in the Multi-Core pipelinein the Rijnmond region could be an attractiveoption.

5.5 Generic studies

The study groups Legislation andAdministrative-Legal Aspects, PhysicalReservations, Financing and Communicationare aimed at handling generic issues.Studies in these areas have been partiallycompleted. Some of the progress made hasalready been mentioned in this report. But inthe next few months, various matters muststill be worked out in further detail. The final

results will be in the final report of theIUTTF.

5.5.1 Legislation and administrative-legal aspects

The appendix on legislation and regulationin “Underground freight transport - achallenge for the future” indicates that inorder to stimulate the construction of UTP,legislation and regulations must be reviewedand that (anticipated) bottlenecks inadministrative and legal spheres must besolved. The study group on Legislation andAdministrative-Legal aspects has listed allthe points for attention for traditionalpipeline transportation and the ULS concept.Bottlenecks, which have been studied duringthe last period and for which solutions werepresented, are the (project) procedures,requirements concerning safety,environment and zoning, compliance withand maintaining those requirements, theposition of the line manager (ownership andmanagement) and the registration of lines, orline managers. Substantial progress hasbeen made in all these areas (see appendix1). It is worth mentioning that safety,environment and zoning were extensivelydiscussed during the past study period withthe Interprovincial Consultation (IPO inDutch) and the Association of Line Ownersin the Netherlands (VELIN). Both the IPO andVELIN pushed for the rapid development ofregulations on a national scale. This pushhelped start the next study period.The study group has also tackled theaspects of “underground zoning”, “liability”and “crisis management”. Undergroundzoning does not conflict with currentlegislation; that subject is completed. Butthe issues of liability and crisis managementrequire further study. The final report willhave the details.A few ULS pilots made it evident that it isnecessary to know the consequences of theTreaty of Malta (protection of archaeologicalheritage) on underground transport. Thestudy groups will also deal with that subjectin the near future.

5.5.2 Space reservation and market analysis

Building UTP, traditional pipelines and ULSrequires space. The study group for SpaceReservation is examining what space theGovernment must reserve within theframework of a revision of the Master Planfor Pipelines (SBUI in Dutch) or within theframework of the realisation of the NTTP.The possibility of integrating SBUI into theNTTP is being considered. Claims of spacefor underground transport has an effect onthe use of space above. The study groupfinds that the space reservations should becarried through to the zoning plans of localgovernments. The group will also examine towhat degree underground infrastructure canbecome equal to aboveground. One reasonwhy equivalence is important is the damage-compensation problem: there must be aslittle chance as possible of having torelocate. The subject of study is whethertransport through pipes can connect withthe corridor idea (such as was developed asa part of the NTTP and the 5th PhysicalPlanning Memo), specifically thecombination of UTP with water, rail and roadinfrastructure. The emphasis here is that theobjective is not a totally undergroundnational network, but an intermodal networkof which underground transport is a part.

Also under consideration is whether it ispossible to reserve space alongside plannedrail infrastructure - specifically the Betuweroute and the HSL South. For both lines,IUTTF has used market analyses to study thepotential market demand. The potentialappeared to be there for the Betuwe route,but further study showed that at certainparts of the line, little or no room is availableto realise a combination with pipelines.There is enough space along the HSL Southline, but in this case the market demand wasnot sufficient. The pipeline route of thePipeline Street of the South-westernNetherlands Organisation easily meets thedemand.

5.5.2 Financing and PPP

The study group on Financing has workedout the criteria upheld by IUTTF for co-financing feasibility studies that contributeto the research programme. In addition, aninventory was made of national and

European regulations which can be used toprovide financial support for research,development and construction of UTPsystems.An important question in realising UTP iswhether forms of Public Private Partnership(PPP) are possible and desirable, withpublic-private financing on the horizon.

To answer that question, IUTTF will use theknowledge that the PPP centre of knowledgehas obtained from the Ministry of Finance. Asolution will also ultimately be found fromthe investigations of Verbugt & co. about theprivate financing possibilities for ULSAalsmeer-Schiphol-Hoofddorp3.

“The government pushes, the market pulls”M. Heijmans, B.Sc., Division Director ofHeijmans Infrastructure and Environment“I am observing a change in the relationshipbetween the government and the market parties.The public and private sectors are now lookingtogether for ways to solve social problems.Public Private Partnership (PPP) createspossibilities for innovative designs and financialstructures. The new vision of co-operationbetween public and private parties requires adefinition of each other’s roles. I believe that it isthe government’s task to formulate generalprinciples, indicate policy lines and draw up newlegislation and regulations. The government thencreates the conditions as monitor of the commongood. For underground transport, practicalexperience is important. Here I consider it thegovernment’s task to stimulate and direct ademonstration project. Then I expect that thebusiness community will gain the necessary, stilllacking insight into operating costs, design andconstruction, as well as the logistics elements.But as a business community, we do want to beinvolved in the entire process from the verybeginning. It must also be clear that businessescan bear the entrepreneurial risk.”Other important subsidiary questions whichneed to be answered are, for example, towhat degree is there a public infrastructure,and what interest do the various parties havein the realisation and operation ofunderground transport. For example, is apipeline for the transport of liquids a form ofinfrastructure, or is the line (also) the meansof transport? Underground transport ofgeneral cargo seems to resemble the

existing modalities, and their use. There is a“road” on or in which vehicles moveforward. Similar questions arise whenconsidering the current discussion on railoperation and infrastructure, especially nowthat it is becoming accessible to the public.

5.5.4 Communication

The first phase makes it clear that therelevant market parties and the wider publicare far from aware of UTP. Unknown isunloved, as the expression goes. This is whyit is very important that the results of theIUTTF become known far and wide. Supportfor a new mode of transport such as UTP isessential. Without support from policy andsociety, UTP will not get off the ground.This is why communications have beengiven the highest priority. Thecommunications study group is using theUTP communication plan. The main idea ofthis plan is that familiarity with UTP must bestimulated in all sorts of ways and that broadsupport must be pursued in the market,government, political community and socialorganisations.Various means of communication areavailable for this. Every quarter, the IUTTFNewsletter informs the target groups of thelatest feasibility studies, developments inpolicy and other news, but also featuresinterviews with key figures in the “outsideworld”. This makes the newsletter animportant source of information for all thoseinvolved.Another means is the working conference. InJune of last year the first working conferencewas a success; a second followed inSeptember. Information about UTP will alsosoon be on the Internet.There is regular discussion aboutcommunication matters with the variousinitiators of the feasibility studies. IUTTF’srole is general director; those who carry outthe pilot projects provide the regional news.People are constantly trying to determinehow the national IUTTF route and theregional pilot projects can reinforce eachother. Consultations and round tablediscussions are also held with the businesscommunity and social organisations.An important aspect in the second phase istesting the support for UTP. A start was

made recently with an analysis of the fieldsof influence, to identify the actors who willplay a role in developing policy concerningUTP and the other interested parties who willcome into play.

“Shopping in a people friendly centre”G. Wisse, business owner in Leiden andChairman of the HaarlemmerstraatShopkeepers’ AssociationI would like to share my thoughts on ULS. Thebusiness community must be involved from thebeginning. The transporters of general goodsmust be well informed of what is and what isn’tpossible with ULS. After all, it’s our livelihood.The present urban system of goods distributionin the town centre is far from ideal. And we allwant a people friendly city. Always looking fornew possibilities is in our blood. We cannotafford to have an inflexible attitude, becauseotherwise the competition will take over.Being shopkeepers, we ask transporters for fastand inexpensive transport. How the goods aredelivered and at what price are of the highestpriority for us. It is the transporter who mustdecide how he brings the goods to us. In order toget the transporters and shopkeepers behind theULS plan, the system will have to have clearadvantages for us. In the end, we all think inhard cash: it has to be worth something to us,too.”

An external consultant will be asking variousparties for their views on UTP. One questionthey will be asked is: which other aspects ofUTP (use of space, improvement of quality oflife, etc.) do you judge positively ornegatively, and what must happen to changetheir point of view. The criteria which serveas a basis for the parties’ opinions andperception of the concept will also beexamined. The results will be included in thefinal report.

The Netherlands Institute for Public Opinion(NIPO) was asked to find out:- to what extentcan underground transport contribute toimproved access of town centres, and inwhat ways should the opportunities of theunderground transport of goods be furtherstudied. The survey was aimed at shippers,logistics service providers, business owners,residents of town centres and politicians. Intotal, there were 1230 interviews. A

substantial majority recognised theimportance of underground goods transport.Between 52 and 73 % of the respondentsbelieved that UTP will improve access totown centres. The greatest majority wasfound among the shippers. Business ownersand residents of the town centre supportedthe study; other shippers, logistics serviceproviders and politicians had a more wait-and-see attitude.

5.5.5 International

On the initiative of the Netherlands, the 5th

Framework Programme of the EuropeanCommission is devoting a great deal ofattention to various aspects of undergroundtransport. This European dimension booststhe feasibility of pilot projects. In co-operation with partners from other memberstates, the Dutch business communityrecently submitted a first proposal on thesubject of “automatic underground distributionand tube transportation systems”. We are alsoready to respond to other relevant themesand related research projects.In addition, five airports in Europe haveprepared a pilot project aimed at substitutingair freight from aeroplane/road to rail. Theidea is to offer a total concept thatcomprises the entire transport chain. InSchiphol’s case, transport to the railway viaULS is part of it. First the feasibility of therail concept will be studied; then a concretepilot project will be worked out.

5.5.6 Technology development and underground transport

The development of the technology forunderground transport can be divided intotwo parts: developing our knowledge of civilengineering aspects (drilling methods,surveying and construction) and of thelogistics and transport systems.

“Technological renewal as an export for theNetherlands”Dr. W.A.G. Blonk, Director of TransportPolicy: Research and Development,Directorate-General VII Transport, EuropeanCommission“The development of technological knowledge isimportant. But even more important is the matter

of how this knowledge can be used by theNetherlands as an export skill or product.It is very important for the Netherlands to keeptheir eyes open for innovative developments andto invest in technological renewal. Undergroundtransport is such an innovative development,which is also on the European agenda and isincluded in the research programme of theEuropean Commission. I am of the opinion that itis in the Dutch government’s interest to helpfinance concrete demonstration projects, bearinga risk, if necessary. On the one hand becausethis offers an opportunity to test out thetechnology, and on the other, because the Dutchbusiness community will then have an importanttechnological edge over other countries. As anation, you must publicise your skills andexpertise. I have observed that the flow ofinnovative ideas is not getting out to the marketoften enough. Lots of investments are devotedto research, but the conversion from product toproduction process simply does not happenfrequently enough. With underground transport,we have technological know-how that deservesto be brought onto the market.”

During the last two years, the Centre forTransport Technology (CTT) has put a greatdeal of energy into setting up and carryingout a development programme. Examplesinclude:

the development of automatically guidedvehicles (AGV’s) which must transportthe load units. These vehicles are nowbeing built, both in a one-on-one versionand to scale, in order to test the vehiclesand the transport system.

load transfer technology, with horizontaltransfer chosen as a starting point. In thetest site this system is being tested indifferent formats in combination with theAGV’s.

a simulation model for calculating thenecessary capacity and the number ofvehicles. This model is being used at thetest site to test out the AGV and loadtransfer technology.

an extensive study on a test site in orderto validate the system as a whole and itsconstituent parts. This test site will bebuilt in Delft.

a logistics concept whereby the flow ofgoods can be transported door-to-door

with as little disturbance as possiblewhilst complying with customers’requirements regarding time, transportand delivery conditions. This is alogistics system whereby the loadcannot be offered unless it is transportedimmediately or within a very short periodof time. Information technology will beapplied to work out the details. Thisconcept will soon be a model for thelogistics concept of underground urbandistribution.

a set of user requirements which a ULScustomer or operator must meet. Withoutthis, the project’s chance of success isminimal.

The Centre for Underground Construction isdeveloping the civil engineeringrequirements for a ULS. These requirementscomprise the modules which are used tobuild the (pipe) connections and theterminals. The modular set-up makes itusable for every type of ULS with only minoradjustments. During the future constructionof ULS-ASH, the CUC will study the effects ofdrilling on the buildings above (sinking,effect on foundations, etc.)

6. Chapter 6 The continuingagenda of IUTTF

During the next stages of the programme,attention will be focused on initiatingdecisions concerning the realisation of oneor a few pilot projects. Another priority is tocontinue the IUTTF research programme.This programme will provide the necessarymaterial to respond to the Van Heemstmotion. The results which will then beavailable will be used as input to the relevantpolicy memos, such as NTTP, 5th

Memorandum on Physical Planning andNREB.The work programme through to mid-2000will concentrate on the matters listed below.

Preparation for decisions on completion of ULS pilotprojects

ULS-ASH is at such a stage that this projectis rapidly approaching actual realisation. Atthe end of 1999 PPP proposals can beexpected from the ULS-ASH Organisation.On that basis, decisions will be made ontheir possible realisation as a pilot project.

Follow-up phase of feasibility studies ULS

On the basis of the available results atpresent, an urban ULS seems a feasibleoption.A subsequent phase following the feasibilitystudy can be a planning study, which canprovide a more definitive answer to thechances of a successful ULS.A condition for the planning study is that allparties involved (governments andbusinesses) must participate - financiallyand practically. For ULS South Limburg, theobjective is to ensure that that transportsolution which is chosen gives maximumsupport to the modal shift. Supplementaryinitiatives from the market for feasibilitystudies will also have to be given dueconsideration. In such cases, the feasibilitystudy will have to provide additional value inknowledge and application of ULS.

Follow-up phase of feasibility studies of traditionalpipelines

Completion of the current feasibility studieson the desirability of an ethylene, propylene

and CO2 network, and preparing the decisionmaking process on this subject.New innovative concepts for traditionalpipelines which are submitted within anIUTTF framework will also be encouraged.

Communication and support

Special priority will be given tocommunications on UTP studies / projects.An important objective will be to map out therelevant participants and an environmentalanalysis. An analysis of the fields ofinfluence and testing the support for UTP arealso high priorities. An absolute conditionfor the success of UTP is a commitment fromthe business community. In mapping out theenvironment, relevant developments,particularly in logistics ideas, will also beincluded and discussed with the businesscommunity. The structure of the logisticschain will be examined and the idea of anintelligent logistics network will bediscussed with the market parties.Besides developing support, the criticalsuccess and failure factors - for both ULSand traditional pipeline transport - will bemapped out.

IUTTF research programme

InfrastructureThe possible roles which the governmentand business community can play, in bothpolicy and financial areas, in realising a UTPinfrastructure must be determined. Ananswer must be found to the question ofwhether this infrastructure should beconsidered a private, public or sharedresponsibility. The matter of UndergroundSpace Reservations is also underdiscussion, partly in view of the revision ofthe Master Plan for Pipelines and theconsequences of the DrawbackCompensation Scheme for Cables and Lines.All of this forms the basis for a response tothe motion of Van Heemst and co.

National NetworkThe first outlines of a connecting intermodalnetwork (rail, inland shipping, transferpoints, integration with ULS) must bedeveloped. Currently running initiatives,such as GOVERA, FLOWNET and such willbe applied. This development process must

eventually result in an initial picture of thedevelopment of the structure for a nationalunderground network.

KnowledgeThe existing knowledge must be furtherexpanded. This applies to the entire range ofdisciplines and task fields, i.e. transport andlogistics, information technology,construction, social considerations,integration of ULS into an intermodalsystem, development of the migration pathto successful UTP applications, legislationand regulations, and financing.

“Without knowledge, there will be norenewal in goods transport”H. van Baaren, B.Sc., Director of ConnektThe demand for knowledge and the supply ofknowledge in the traffic and transport sectormust connect and keep up with each other.Connekt’s task is to develop knowledge, make itaccessible, and properly apply that knowledge inthis sector. This is why Connekt plays a key rolein the development of knowledge needed forunderground transport. Without that knowledge,underground transport will not get off the ground.The growth and development of traffic andtransport will take place in the next century andcreate tension between economy, environmentand physical planning. The problems of thefuture are also the problems of today, and youhave to stay ahead of them. We urgently needknowledge and innovative research to be able torespond to those problems. Knowledge in thefield of underground transport is necessary, butpractical tests are needed as well. We will soonget started at the Test Site in Delft with thevehicles which will ride through the undergroundlogistics systems of the future. Withoutknowledge, no innovation.”

7. APPENDIX 1 Legislation andadministrative-legal aspects

Section 5.4.1 of this report briefly indicatedwhich subjects were handled by theLegislation and Administrative-legal Aspectsstudy group during the last research period,and those which will be examined during thenext period. In the present appendix we shallexamine more closely a few subjects inwhich substantial progress has been made.

7.1 Safety, environment and zoningThe current statutory regulations whichrelate to the transport of harmful substancesthrough pipelines do not provide thegovernment with the opportunity to graspand shape the safety of this form oftransport for man and the environment.Although the chances that something can gowrong with a pipeline, and that the transportof harmful substances through pipelines ischaracterised by a small number ofincidents, the consequences of accidentscan be enormous for the environment. Thisis because large amounts of harmfulsubstances are being transported. It is truethat officially, in a number of cases,requirements concerning the intrinsic safetyof pipelines are specified, the soundmanagement and maintenance of thepipelines and safety zoning are alsospecified, but the incompleteness and lackof clarity within the legal framework requirefurther attention, particularly with respect tocompliance with these requirements. A legalsafety net for making appropriate regulationsis missing in all cases.For traditional transport by pipeline, this wasthe reason for the InterprovincialConsultation (IPC) starting with thedevelopment of a module for“pipelines in themodel-provincial environmentalregulations”. The IPO indicated theirpreference for regulation on a national scalein view of the cross-(provincial) border andsometimes even international character oftransport by pipeline. For that same reason,the Association of Line Owners in theNetherlands (VELIN in Dutch) are arguinghard in favour of national statutoryregulations. Now the Legislation studygroup, in consultation with the IPC and the

VELIN, is examining what legal frameworkcan provide a statutory regulation on anational level. It will be based as much aspossible on existing standards (such asNEN-3650) with accompanying self-regulation and existing insights into safetyzoning (as expressed in the Master Plan forPipelines, the Ministry of Housing, PhysicalPlanning and Environment’s zoning circularsand the Memo on Risk Standardisation forthe Transport of Harmful Substances).Attention will also be devoted to how it allfits together on a European scale. This willbe developed in the final report of IUTTF.The European Commission is examiningwhether it is desirable to adopt a Europeanapproach for traditional pipelines.Consideration 13 of the guideline 96/82/EG,better known as the Seveso II Guideline,states that the Commission was assignedthe task of preparing an announcement onpossible action in the transport of harmfulsubstances through pipelines in connectionwith the risk of serious accidents. TheCommission has since brought a so-calledbenchmark for preparing a guideline intocirculation. The member countries (in theNetherlands the Ministry of Housing,Physical Planning and Environment is thefirst-responsible) were asked to check towhat degree national legislation deviatesfrom this benchmark. The answer was thatDutch legislation is fragmented andincomplete and that the Netherlands takes apositive stance toward developing aguideline along the main lines of thebenchmark. This part will be developed inthe final report.

7.2 Registration and informationA point for attention closely connected withthe above subject is the registration of lines,and / or line managers. This also concernsthe recognition and availability of theregistered information for (third-party)ground agitators (HELP). Both localgovernments and market parties consider itimportant to have a reliable system ofregistration to prevent damage to a line bythird parties, and an effective means ofsettlement of disasters in the direct vicinityof lines. Registration of lines or linemanagers is not currently required by law inall cases. What role the Cables and Lines

Information Centre (KLIC) and/or the LandRegistry can play in improving registrationand information will be examined. Anevaluation will be given in the final report.

7.3 Position of the line manager(ownership and management)In January 1999 a research report waspublished which included manyrecommendations on line management.These will be studied further in the time tocome. Points for decision will be indicated inthe final report.

OwnershipThe most salient ownership issue is: How farbelow the ground does ownership reach? 4In current Dutch law, it is unclear how theownership of a line relates to the ownershipof the ground through which that linepasses. This lack of clarity arises out of afew sections of the law of the Civil Code (BWin Dutch). Possible solutions are: include in article 5:21 BW a strict

standard whereby the use of the groundbelow a certain depth is free, regardlessof possible interests of the owner of theground;

effect an arrangement for a horizontalsplit;

include an “ex lege toleration obligation”for underground transport and pipelines,comparable to the arrangement in theTelecommunication Act (section 5.1);

harmonise sections 5:20 and 5:21 BW sothat the extent of the right of ownershipcorresponds with the regulatingauthority of the owner.

ManagementIt is unclear which are the fields of influencethat the line manager occupies with respectto the other involved parties, such as theowner of the ground, the builder, thefinancier and the transporter. Here the lackof clarity cannot be blamed on one or moresections of the law, but on the absence ofstatutory regulations to that regard. Possiblesolutions:

4

This question was also handled during thegeneral consultation of 3 September last year(see TK 1989-1999, 26 018, no. 2, pp. 4 and 5).

define the responsibilities of themanagement of underground transportand pipelines in which the position of theline manager and the legalconsequences which pertain to it aremade clear;

draw up a specific arrangement withinthe framework of liability (sec. 6:174 and6:175 BW) for the situation in which themanagement is spread over differentpeople;

make up an arrangement for removing orrendering harmless pipelines which areno longer in use.

7.4 ProceduresIn “Underground freight transport - achallenge for the future” it was alreadyindicated that the streamlining andabridgement of construction procedures willbe connected with the development ofgovernment project procedures.This procedure is intended for (large)projects of national import which do not fallunder the scope of the Line Act.In the beginning of this year a bill regardingthe alteration of the Physical Planning Act inconnection with the adoption of agovernment project procedure was sentround for comments to variousorganisations. The bill will soon be sent tothe Council of State for a recommendation.In the explanatory statement with the (draft)bill, a few examples of government projectsare mentioned, including (large-scale)pipelines.It must be further evaluated whether it isnecessary to develop a provincial projectprocedure for pipelines which are not ofnational import. The IPO has indicated thatthere is a need for such an arrangement.This will be handled in more detail in thefinal report.

7.5 Underground zoningThis subject particularly concerns theelaboration of the motions of Feenstra & co.5

5 “…actively requests the government to draft abill for the physical planning of theunderground” (see TK 1997-1998, 25 405, no.5).

and Witteveen-Hevinga & co.6 on (physical)planning instruments for the organisationand management of the underground. TheMinistry of Housing, Physical Planning andEnvironment organised a workshop inNovember of last year on the themeunderground zoning. It was concluded thatthe Physical Planning Act is quite applicableto usage of underground space. Thereforeno separate bill for the underground needsto be drawn up (Feenstra & co. motion). Forthe Legislation study group the subject hasbeen rounded off and the motion of Feenstra& co. has been answered. But there is still agreat deal of ambiguity concerningembedding planning for the use ofunderground space. In order to improve thissituation, the following recommendationswere made: when forming plans, ensure thorough

preparatory study is focused onharmonising the various zoning /interests (in that regard it will beexamined whether it is desirable toadjust the Physical Planning Decree);

see to the proper registration of what iscurrently underground;

provide for an exchange of knowledgevia zoning plan examples.

These recommendations will be worked outvia the regular communication channels (notin an IUTTF bulletin).Another conclusion was that theGovernment lacks a vision concerning theregulation of space below ground andunderground construction. In thatconnection, it is noted that theimplementation of the motion of Ravestein &co.7 will be involved in the development ofthe Fifth Memo on Physical Planning andpossibly other government memoranda.5

6

6

“… invites the cabinet to encourage thedevelopment of cohesive policy for theorganization and management of “theunderground”, while including the customaryregulation procedures” (see TK 1995-1996, 24525 and 22 232, no. 9).7

7 “requests the government to offer the Housea memo on underground construction and therelevant planning and legal instruments (see TK1998-1999, 26 200 XI, no. 12).

Appendix 2 Composition of“Transport by Pipeline” Platform

HeinekenH.A. van Ballegooijen

NCC-SBBR.K.S. Biermasz.

Wvin KLS IndustrieP. Bijl

Amsterdam Airport SchipholF.S. Bisschop

Van Gend en LoosR.H.T. Buitelaar

EVOL.A. d’Hont

TebodinG.J. Dijkstra

N.V. Nederlandse GasunieH. van Donselaar

BIGA.J. van Eeden

Gemeentelijk Havenbedrijf AmsterdamJ.W. Egbertsen

(Municipal Port Installation Amsterdam)Grontmij

D. EttemaGansewinkel Groep

P.P. GrielenBolegbo-vok

J.B. HeijnenNederland Distributieland

B.J. HoetinkTNO-INRO

R.A. van der KlauwCampina Melkunie BV

J. KleibukerTebodin

A.G. KnippingGemeentelijk Havenbedrijf Rotterdam

J.W. Koeman(Municipal Port Installation Rotterdam)IPO

F.J. KoemanCOB/CUR

J.C. KuiperNUON

J.P.H. NelissenProcter & Gamble

F. OlshornHeerema Infrastructure BV

J. SchippersTLN

J. Tjarks

VELINP. Valk

Visser&Smit HanabH. van de Werff

Corresponding members:Albert Heijn

J.N. WillemseGemeentelijk Havenbedrijf Rotterdam

R.A. BackersStichting Natuure en Milieu

NijhoffTebodin

Van RietVNO-NCW

P.M.M. van OstaijenVNCI

D.A. Schuddebeurs

D. Goedhart

Daily Board PlatformVermunt Logistiek Advies

Prof. Dr. A.J.M. Vermunt, ChairmanGrontmij

S. Leemhuis, B.Sc., SecretaryRaadgevend Ingenieursbureau Lievense

J.J. van den Berg, I.C.E.Hak Nederland BV

J. BlomDSM/VELIN

J. Werker

Underground Freight Transport - AChallenge for the Future : The Link in theChain, is published by:

Ministry of Transport, Public Works andWater ManagementDirectorate-General for Freight TransportP.O. Box 209042500 EX The HagueThe NetherlandsPhone: + 31 70 351 1409Fax: + 31 70 351 1966

Ministry of Housing, Spatial Planning andthe Environment

Ministry of Economic Affairs