GREEN LOGISTICS Improving the environmental sustainability of logistics EditEd by AlAn McKinnon, ShAron cullinAnE, MichAEl brownE, Anthony whitEing Publisher’s note Every possible effort has been made to ensure that the information contained in this book is accurate at the time of going to press, and the publishers and authors cannot accept responsibility for any errors or omissions, however caused. No responsibility for loss or damage occasioned to any person acting, or refraining from action, as a result of the material in this publication can be accepted by the editor, the publisher or any of the authors. First published in Great Britain and the United States in 2010 by Kogan Page Limited Apart from any fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form or by any means, with the prior permission in writing of the publishers, or in the case of repro- graphic reproduction in accordance with the terms and licences issued by the CLA. Enquiries concerning reproduction outside these terms should be sent to the publishers at the undermentioned addresses: 120 Pentonville Road 525 South 4th Street, #241 4737/23 Ansari Road London N1 9JN Philadelphia PA 19147 Daryaganj United Kingdom USA New Delhi 110002 www.koganpage.com India © Alan McKinnon, Sharon Cullinane, Michael Browne and Anthony Whiteing, 2010 The right of the authors to be identified as the authors of this work has been asserted by them in accordance with the Copyright, Designs and Patents Act 1988. ISBN 978 0 7494 5678 8 British Library Cataloguing-in-Publication Data A CIP record for this book is available from the British Library. Library of Congress Cataloging-in-Publication Data Green logistics : improving the environmental sustainability of logistics / Alan McKinnon ... [et al.]. p. cm. Includes bibliographical references. ISBN 978-0-7494-5678-8 1. Business logistics--Environmental aspects. I. McKinnon, Alan C., 1953- HD38.5.G696 2010 658.7--dc22 2009037392 Typeset by Saxon Graphics Ltd, Derby Printed and bound in India by Replika Press Pvt Ltd Contents Contributor biographies vii Part 1 Assessing the environmentAL effeCts of LogistiCs 1 1 Environmental sustainability: a new priority for logistics managers 3 Alan McKinnon1 Introduction 3; A brief history of green logistics research 5; Green logistics: rhetoric and reality 17; A model for green logistics research 19; Outline of the book 22; notes 25; References 25 2 Assessing the environmental impacts of freight transport 31 Sharon Cullinane and Julia Edwards Introduction 31; Environmental impacts 32; Environmental standards 39; measuring the environmental impact of freight transport 42; Notes 45; References 45 3 Carbon auditing of companies, supply chains and products 49 Maja Piecyk Introduction 49; Guidelines for carbon footprinting 50; The carbon footprinting process 51; Success factors in carbon footprinting 59; Case study: carbon auditing of road freight transport operations in the UK 60; Conclusions 65; References 66 iv ❚ Contents 4 Evaluating and internalizing the environmental costs of logistics 68 Maja Piecyk, Alan McKinnon and Julian Allen Introduction 68; Arguments for and against the internalization of environmental costs 69; Monetary valuation of environmental costs 72; Internalization of the external costs imposed by road freight vehicles in the UK 79; Conclusions 93; Notes 95; References 95 Part 2 strAtegiC PersPeCtive 9 9 5 Restructuring of logistics systems and supply chains 101 Irina Harris, Vasco Sanchez Rodrigues, Mohamed Naim and Christine Mumford Introduction 101; Current state of knowledge of traditional supply chains 102; Green supply chains 111; Gaps in our understanding and priorities for research 116; Consequences and conclusions 119; References 120 6 Transferring freight to ‘greener’ transport modes 124 Allan Woodburn and Anthony Whiteing Background 124; Characteristics of the main freight transport modes 126; Environmental impacts of the main freight transport modes 129; Case study: container train load factors 130; The policy framework 131; Examples of measures aimed at achieving modal shift for environmental benefit 133; Rail and water industries 135; Conclusions 138; References 139 7 Development of greener vehicles, aircraft and ships 140 Alan McKinnon, Julian Allen and Allan Woodburn Introduction 140; Road freight 141; Rail freight operations 150; Air freight 153; Shipping 157; Conclusions 162; Notes 162; References 163 8 Reducing the environmental impact of warehousing 167 Clive Marchant Introduction 167; Scale of the environmental impact 168; Increasing resource intensity 171; Framework for assessing the environmental impact of warehouses 173; Ways of reducing the environmental impact 173; Conclusion 189; References 190 Contents ❚ v Part 3 oPerAtionAL PersPeCtive 193 9 Opportunities for improving vehicle utilization 195 Alan McKinnon and Julia Edwards Introduction 195; Measuring vehicle utilization 196; Factors affecting the utilization of truck capacity 199; Conclusion 210; Note 210; References 210 10 Optimizing the routing of vehicles 215 Richard Eglese and Dan Black Introduction 215; Vehicle routing problems 216; Types of problem 217; Environmental impact 221; Conclusions 224; References 225 11 Increasing fuel efficiency in the road freight sector 229 Alan McKinnon Introduction 229; Fuel efficiency of new trucks 230; Vehicle design: aerodynamic profiling 231; Reducing the vehicle tare weight 232; Vehicle purchase decision 233; Vehicle maintenance 234; Increasing the fuel efficiency of trucking operations 235; Benchmarking the fuel efficiency of trucks 237; More fuel-efficient driving 238; Fleet management 239; Conclusions 240; References 240 12 Reverse logistics for the management of waste 242 Tom Cherrett, Sarah Maynard, Fraser McLeod and Adrian Hickford Introduction 242; Waste management in the context of reverse logistics 243; The impact of waste treatment legislation 246; Reuse, refurbishment markets and take-back schemes 250; Managing waste as part of a sustainable reverse process 253; Conclusions 256; References 259 Part 4 Key issues 263 13 The food miles debate 265 Tara Garnett Introduction 265; Transport and GHGs: is further worse? 266; Transport, the second order impacts and the implications for GHGs 272; Local versus global and the self-sufficiency question 274; Notes 277; References 277 vi ❚ Contents 14 Sustainability strategies for city logistics 282 Julian Allen and Michael Browne Introduction 282; Urban freight research and policy making 283; Efficiency problems in urban freight transport 285; Urban freight transport initiatives 288; urban consolidation centres 290; Joint working between the public and private sectors 294; Environmental zones 296; Conclusions 301; References 302 15 Benefits and costs of switching to alternative fuels 306 Sharon Cullinane and Julia Edwards Introduction 306; The main types of alternative fuels 307; Current use of AFs in the freight industry 316; The future 318; Notes 318; References 319 16 E-business, e-logistics and the environment 322 Julia Edwards, Yingli Wang, Andrew Potter and Sharon Cullinane Introduction 322; Business-to-business (B2B) 323; Business-to- consumer (B2C) 327; Restructuring of the supply chain 330; the environmental impact of e-commerce 330; Case study: Online Books supply chain 333; The future 335; References 335 Part 5 PuBLiC PoLiCy PersPeCtive 339 17 The role of government in promoting green logistics 341 Alan McKinnon Introduction 341; Objectives of public policy on sustainable logistics 344; Policy measures 344; Reducing freight transport intensity 347; Shifting freight to greener transport modes 349; Improving vehicle utilization 351; Increasing energy efficiency 353; cutting emissions relative to energy use 355; Government- sponsored advisory and accreditation programmes 356; Conclusion 357; Note 358; References 358 Index 361 Contributor biographies Julian Allen is a Senior Research Fellow in the Transport Department at the University of Westminster, where he is involved in research and teaching activities relating to freight transport and logistics. His current research interests are urban freight transport, the impact of manufac- turing and retailing techniques on logistics and transportation systems and the history of freight transport. Daniel Black is a Research Associate at the Department of Management Science in Lancaster University Management School. His research interests include the environmental impact of vehicle routing and sched- uling decisions, stochastic inventory control and optimization problems with particular reference to developing computer-based models. michael Browne directs freight transport and logistics research at the University of Westminster. Recent projects include: research on the energy use implications of global sourcing, potential benefits from improved city logistics strategies and forecasting future trends in logistics. He has worked on studies for Transport for London, the European Commission, the UK Department for Transport, the Research Councils and commercial organizations. He represents the University on many external committees and boards and chairs the Central London Freight Quality Partnership. tom Cherrett B.Sc., Ph.D, MCILT is a Senior Lecturer in the Transportation Research Group, University of Southampton. His main research areas include developing sustainable strategies for the collection and disposal viii ❚ Contributors of waste and the distribution of goods in urban areas, including distri- bution strategies for sustainable home delivery. He has considerable experience in the areas of incident detection and journey time estimation using urban traffic control infrastructure. He has management and logistics experience from working in the chilled distribution sector. sharon Cullinane gained her PhD in logistics 20 years ago from Plymouth University. Since then she has continued to lecture, research and publish in the field of transport policy and the environment around the world. Her most recent post was as Senior Lecturer at Heriot-Watt University in Edinburgh. Prior to that she was employed at the University of Hong Kong, Oxford University, the Egyptian National Institute of Transport, the Ecole Superieur de Rennes and Plymouth University. She is now an independent consultant. She is widely published internationally. Julia edwards is a Research Associate at the Logistics Research Centre in the School of Management and Languages at Heriot-Watt University, Edinburgh. She joined Heriot-Watt in 2006, as part of the multi-university ‘Green Logistics’ project. Prior to that she was a Senior Lecturer in Environmental Management at the University of Wales, Newport. Dr. Edwards has been researching and teaching in the areas of transport and environmental issues for the last 16 years. Currently, her research interests include carbon auditing of supply chains, e-commerce and the envi- ronment, and consumer travel and shopping behaviour. richard eglese is a Professor of Operational Research at the Department of Management Science in Lancaster University Management School. His research interests concern mathematical and computational modelling for logistics and focus on optimization techniques, particularly heuristic methods, applied to problems of vehicle routing and scheduling. He has worked on a variety of applications including food distribution to super- markets and winter gritting for road surfaces. In 2010–2011 he is President of the Operational Research Society. tara garnett set up and runs the Food Climate Research Network based at the University of Surrey (www.fcrn.org.uk). Her work focuses on the contribution that the food system makes to greenhouse gas emissions and the scope for emissions reduction, looking at the technological, behav- ioural and policy options. She is also interested in the relationship between emissions reduction objectives and other social and ethical concerns, including human health, animal welfare, international development and biodiversity. Contributors ❚ ix irina harris is a research student at Cardiff University. Her research project on ‘Multi-Objective Optimization for Green Logistics’ is jointly supervised by Cardiff School of Computer Science and Cardiff Business School. The objective is to investigate the feasibility of building a multi- objective optimization decision support tool for modelling the physical infrastructure of a logistics network where traditional and environmental objectives are considered simultaneously. The approach focuses on producing a set of viable alternatives for a decision-maker in contrast to calculating objectives as a constraint or prioritizing them. Clive marchant is a senior teaching fellow at Heriot-Watt University, Edinburgh, where he teaches freight transport systems as well as distri- bution centre design and management. He is an active member of the Chartered Institute of Logistics and Transport as well as member of the Warehouse Education Research Council in the USA. Prior to obtaining a Masters at Edinburgh and Heriot-Watt Universities he had a 25 year career in the third party logistics sector encompassing roles in operational management and the design of distribution networks and warehousing. sarah maynard BSc, MSc, is a researcher at the Transportation Research Group (TRG), University of Southampton, UK. Since joining TRG in 2004 she has specialized in waste transport research and has been involved in a number of projects funded by the Engineering and Physical Sciences Research Council. Recent research has investigated the transport impacts associated with household waste recycling centres and the benefits of using reverse logistics processes to collect returns and waste generated by different retail supply chains in urban centres. Alan mcKinnon is Professor of Logistics and Director of the Logistics Research Centre at Heriot-Watt University, Edinburgh. A graduate of the universities of Aberdeen, British Columbia and London, he has been researching and teaching in freight transport/logistics for 30 years and has published extensively in journals and books. Alan has conducted studies for numerous public and private sector organizations, and has been an adviser to several UK government departments and parlia- mentary committees and various international agencies. He is also a member of the World Economic Forum’s Global Agenda Council on the Future of Transportation. fraser mcLeod (B.Sc. in mathematics, M.Phil. in passive sonar) is a Research Fellow with the Transportation Research Group, University of Southampton, with over 20 years experience of working on transport- related projects. In recent years his work has focused on Intelligent