INTRODUCTION (2)

WANG. XUEFENG

INTRODUCTION (2)-POLICY

The development of intermodal freight transport is

significantly influenced by the official policies of both
individual national governments and, collectively, of the
European Union (EU) via the European Commission (EC).
Without such a driving force keeping the inertia moving
forward it seems likely that the progress we are currently
seeing in intermodalism, as opposed to single-mode
transport operation, would hardly be noticeable.

Commercial arguments alone appear insufficient to propel

growth in intermodal freight transport sector, so it is down
to official persuasion on account of the environmental and
humanitarian benefits of modal switch, plus a certain
amount of encouragement by way of financial grants to aid
the development of suitable terminal facilities for modal
transfer, to provide the incentive for change.

An understanding of the policies will provide a useful

background to the way in which intermodalism has
developed, and to the technical and operational
characteristics of this form of transport and its constituent
individual modal ingredients.

UK Government policy
For many years transport policy in the UK was
obsessed first with nationalization and then with
privatization, and the issues of deregulation and
fair competition. There was little in the way of
practical effort to secure a better transport system
better for users of transport services and better
for the population that has to live with the
consequences of an inadequate transport system.
Since 1997, however, the Government has been
strong on the issue of meaningful policy
documents.
Regulation?

Royal Commission Report: Transport and the

Environment

The 1994 Report determined that an important objective for a

sustainable transport policy must be founded on the concept
of increasing the proportions of personal travel and freight
transport by environmentally less damaging modes and to
make the best use of existing infrastructure.

It effectively warned that the likely consequences of taking

more and more land to provide new infrastructure to cope with
the forecast massive growth in road use could not be
sustainable, so alternatives had to be devised and developed.

The report highlighted the fact that the projected growth of

heavy-goods vehicle traffic between 1989 and 2025 was no
less than 140 per cent. The Report discussed the scope for
mode switching and described in detail the attributes of
individual modes, particularly in terms of their energy
efficiencies, emissions, noise levels, and accident rates.

It concluded that even with a large-scale shift to rail, road

transport would remain the dominant mode for freight
transport and, therefore, it was important to explore all
possible ways of limiting its adverse environmental impact.

Planning guidance
The Governments Planning Policy Guidance set
out far-reaching aims among which was recognition
of the need to encourage the use of alternative
transport modes to divert freight away from road
and onto rail or the waterways.
It noted the fact that many other European
countries achieve greater use of rail for freight
transport than the UK.
Importantly, it said that planning should identify and
allocate appropriate sites for distribution and
warehousing, and that consideration should be
given to safeguarding rail and waterside sites for
future industrial use and to encourage current users
of rail and water not to switch to road.

White Paper: A New Deal for

Transport
A New Deal for Transport: Freight transport
features importantly with the recognition that the
nation wants and needs a reliable and efficient
transport system that supports prosperity, to provide
the jobs and wealth we all want, but that the growth
in freight transport risks being met at the expense of
our environment. This is why we want to reduce the
extent to which a healthier economy results in high
levels of road-traffic growth. We want to see a real
increase in the use of rail freight, inland waterways
and coastal shipping.
In other words the Government wants to see a clear
modal switch away from road freight, which
obviously means a need for more intermodal
freighting rather than ever increasing use of the
heavy lorry.

The key proposals of interest to

the intermodal sector
The establishment of a new rail authority to
promote rail freight and its infrastructure (i.e. the
Strategic Rail Authority (SRA).
Encouraging greater use of six-axle lorries (to
enable the carriage of heavy intermodal loading
units (ILUs)).
Improving best practice in the freight industry.
Introducing legal powers to impound illegally
operated lorries.
Facilitating shipping as an efficient and
environmentally friendly means of carrying trade.
Extending the pre-existing freight grants scheme for
developing rail terminal facilities to include coastal
and short-sea shipping activities.

The White Paper stated: we can move more freight by rail,

relieving pressure on the road network and bringing
environmental benefits.

To achieve this target, a number of important promises were

made:
To ensure (through the SRA) that freight is given proper
consideration in the operation and planning of the rail network.
That proper attention would be given to such obstacles
as rail loading gauge, track capacity constraints, and access to
additional land.
That revised planning guidance would be issued to
facilitate the carriage of more freight by rail.

As part of its strategy to encourage more efficient distribution

of goods, the White Paper stated the Governments intention to
increase lorry weights in line with EU law to facilitate the legal
carriage of heavy ISO container and international swap body
traffic.

 Another aspect of the Governments intentions for

developing freight modes concerns coastal shipping
and inland waterways.
It stated that, potentially, some 3.5 per cent of UK
road freight traffic could be diverted on to the
waterways. To encourage this modal switch to
short-sea and coastal shipping, and to encourage
greater use of the inland waterways, where this is a
practical and economic solution, the freight grants
regime was extended to cover these modes.
Grant aid (known by various names and
designations) is a principal aspect of European
Union (EU) and UK Governmental policy designed
to generate environmental benefits by encouraging
a switch of freight to more sustainable modes of
transport, such as from road to rail or to inland
waterway and short sea modes

UK Government grants
1. Rail Freight Facilities Grant (FFG) provided to
part-finance the capital costs of providing rail freight
facilities.
2. Waterborne Freight Facilities Grant (WFFG) made
available to part-finance the capital cost of providing
waterborne freight facilities at ports and wharves.
3. Track Access Grant (TAG) which helps offset the
track access charges levied on rail freight operators
for use of the rail network in return for generating
environmental benefits by switching freight traffic
from road to rail.
4. Company Neutral Revenue Support (CNRS)
scheme which is designed to further growth in the
movement of deep-sea, short-sea, and domestic rail
freighting of intermodal containers.

Sustainable distribution
The New Deal, particularly, notes the vital need for building
sustainable distribution systems that achieve better utilization
of railways, ports, and shipping. It reiterated its intention to:
set up the SRA;
promote improvement of rail-freight services;
promote greater use of rail freight through incentives such as
the freight grants scheme;
extend the coverage of the freight facilities grant scheme to
the coastal and short-sea shipping sector;
encourage waterborne traffic where practical and economic;
work with British Waterways and others to identify realistic
market opportunities for inland waterways;
establish a Shipping Working Group to identify measures to
help reverse the decline in UK shipping and foster greater use
of short-sea and coastal shipping around the UK, and beyond
to the rest of Europe.

The Governments sustainable distribution strategy document

sets out a policy framework for major freight interchanges,
recognizing that the performance of these facilities in
distribution networks is vital to promoting greater use of
intermodal freight. The policy framework does the following:
Promotes the contribution of the UKs major freight
interchanges to national and regional competitiveness by
pursuing policies of fair competition in the UK and throughout
Europe; by giving due weight to the need for efficient transshipment between the different transport modes; and by
providing efficient access to and from major interchanges.
Aims to improve the operational and environmental
performance of existing interchange facilities by promoting
greater use of less damaging modes for onward distribution.
Encourages full and efficient utilization of existing interchange
facilities in preference to expansion in cases where suitable
spare capacity exists or can be created.

Intermodal policy in the EU

Two other key moves towards further
integration of European transport occurred in
2003 when the EC became actively involved
in issues regarding navigation on the rivers
Rhine and Danube and concluded accession
to the Convention concerning International
Carriage by Rail (COTIF), thereby being in a
position to facilitate international rail
transport by participating in the development
of uniform legal rules for the whole of the
continent of Europe.

The Railway Directive

The so-called Railway Directive was intended
to instigate a status of independent operator on
national rail systems throughout the Union so
that they behave in a more commercial manner
adapting to market needs, all in the interests of
improved efficiency in other words promoting
the concept of privatization. Its specific aim was
to open up the railways for use by independent
operators and facilitate access to rail networks
throughout the EU for those organizations
engaged in the international combined transport
of goods.

 The Directive required the management of rail

transport services and of the railway
infrastructure to be separated (with separate
accounting systems).
The point is that with this new structure there is
greater facility and incentive for private operators
(e.g. road hauliers) to incorporate rail trunking
within their operating plans. This in turn
encourages the use of intermodal transport units,
whether complete semi-trailers, swap body or
container traffic, and consequently contributes
further to the overall ideology of switching longhaul freight traffic from road to rail.

The railway packages

Development of EU railway policy has focused on
what are termed the three railway packages. The
first of these was based on the provisions of the
Railway Directive 1991, permitting open access for
international rail services across the EU.
The so-called second package of measures was to
revitalize the railways by building an integrated
European railway area, in particular by opening up
more quickly the international rail-freight market, by
proposing a new directive on railway safety and by
establishing a European Railway Agency.
The third railway package proposes opening up of
international passenger rail services within the
Community from 2010 and the introduction of a
certification system for locomotive drivers.

The General Plan for combined

transport

The EC resolution highlighted a number of points that were to receive

special attention as follows:
Implementation of a policy for intermodal transport ensuring free
choice of transport methods for users.
Economic and commercial aspects of intermodal transport.
Definition of a rational plan of routes and terminals, including
clearance and railway track gauges.
Harmonization of technical and operational aspects including
terminal and rolling stock management.
Organization and management of the administrative, financial,
quality of service, and responsibility aspects according to decisionmaking level (i.e. European Community, Member State, or combined
transport operator). Africa?
The coherence of legislative, statutory, and administrative regulation
of intermodal transport at both Community and national level.
Access to the combined transport system.
The contribution that combined transport can bring in reducing the
problems linked to road transit through third countries. Improving
economic development in Africa?

Working Group Report:

It also gave the

following outlines of the solutions that could be
adopted.

Freedom of choice: While the Group recognized

and agreed the principle of free choice for the
transport user, it commented that this should not be
distorted by variable allocation of the infrastructure
costs depending on the transport mode, and that
external costs related to the different modes are
not always given the same consideration and may
therefore cause distortion in the competitivity of
modes. It proposed progressive reintroduction of
the real cost of transport albeit a long-term
project that would need to be fair for all modes.

 Economical and commercial aspects: Three

thresholds of profitability were proposed for study:
that of the operators, of the investment in
infrastructure, and a broad economic profitability
integrating part of the external costs, all of which
should lead to a profitability model of a network.
The Group further proposed that analyses should
be carried out to determine the calculation
methods by which external costs could be
integrated and a decision made as to which of
such costs should be taken into account.

 Scheme for routes and terminals: The

establishment of a minimum common profile either
by gauge development or by setting up specific
railway rolling stock was suggested. Due to the
diversity of multimodal platforms (i.e. terminals),
the importance of establishing a coherent network
and the need for their optimal location, the Group
proposed further studies on this subject, first by
obtaining relevant data on existing and proposed
terminals, second by bringing together, in the form
of a seminar, owners and operators of terminals
with the objective of promoting the implementation
of a network, and third by establishing a
management and location model for a goods
handling station to see how this might be
reproduced for all terminals.

 Technical and operational aspects: The Group

recognized the many problems of technical
compatibility that exist in multimodal transport and
the high costs of investment in equipment which
inhibits the participation of small and medium
companies in combined transport. It stated the
need for study of the specific standards for rolling
stock used exclusively in combined transport and,
more particularly, for road equipment, and it
commented on new technical developments in bimodal transport. The Group proposed a
demonstration of these new technologies on a
selected route, so a study could be made of the
commercial viability of the equipment tested.
Manufacturers and operators would be asked to
help by developing compatible equipment.

 Organization and management: The need for quality

of service was seen as paramount, but the Group
recognized that it is based on a large number of
elements which have neither the same status nor
structure, objectives nor operating modes between
the large monopolistic structures (such as the
railways) and what it calls the atomized market
(such as small road hauliers). It proposed the
launching of an experimental combined transport
service on one, two, or a maximum of three routes
with a high traffic density potential taking advantage
of the best possible conditions (not current normal
conditions), so an audit could be carried out to
determine to what extent and according to which
modalities this experiment could, in future, be
reproduced on other routes. This would involve
partnership agreements (taking account of
competition rules) between all the parties involved,
and sponsorship from the Commission.

 Statutory, legal, and administrative aspects:

Member States were requested to provide
information on the present status of their
domestic legislation regarding combined
transport. This information was to be analysed
to obtain a picture of the regulatory situation for
combined transport within the Community, and
to identify any discrepancies still existing
between Member States.

The Master Plan

In June 1992 the Commission of the European
Communities adopted a blueprint Master Plan for
developing a European combined transport
network based on the previously mentioned
recommendations of the Working Group.
Establishment of networks: Most importantly,
among these intended measures, the Commission
proposed the adoption of a rail network covering
the routes at present heavily used by long-distance
road traffic, devoted to actual establishment of the
network and concerned with bringing rail track
clearance and loading gauges up to the minimum
standard needed to take containers and swap
bodies standardized at the European level.

The Common Transport Policy

EC further signified its concern for the development
of combined transport systems when it issued a
communication, which would gain a new impulsion
from the implementation of the Treaty on EU
agreed at Maastricht. In particular, it would include
measures for improving trans-European networks, a
new basis for development of the transport
infrastructure, and the challenge of integrating
environmental objectives, not least of which was the
expansion of combined transport operations.
In general, it will be apparent that rail is the
underutilized sector and that the road mode is the
bad guy producing all the problems, and this is the
imbalance that the Commission is trying to address.

Modal disequilibria
The Commissions disquiet was stated as follows:
The expansion of the transport sector (within the
economy) has, however, brought problems in its
wake: growth has produced or exacerbated a
number of imbalances and inefficiencies in the
transport system taken as a whole and also within
transport modes. Despite the considerable
success of transport in meeting consumer
demand, inadequate integration of modes is
denying users [of] some practical alternatives to
current services. Inadequate capacity in some
modes is producing congestion and environmental
damage, while, in others, underused capacities
exist. Inadequate or incomplete networks cause
bottlenecks in some areas.

Road
The Commission went on to say in its
communication:
One of the important reasons why
imbalances and inefficiencies have arisen is
because transport users have not been
adequately confronted with the full costs of their
activities and because the construction of
transport infrastructure has been lagging behind
what was needed.

The challenge

The challenge for the Communitys transport system is how to

provide, in the most efficient manner, the services that are
necessary for the continued success of the single market,
while continuing to reduce the inefficiencies and imbalances
of the system and safeguarding against the harmful effects
that increased transport activity generates. It is possible to
meet this challenge, while respecting the basic tenets of the
free market, by the introduction of economically efficient
transport policies.

One of the ways in which the shortcomings in infrastructure

could be overcome was to look for ways to increase
resources available for investment, particularly by the private
sector.

The further suggestion: it is essential to examine how underused capacity in the transport system, particularly in the
modes other than road, could be brought into service, while
respecting the free choice of the user.

The measures

First that the development of more attractive intermodal

services depends to a considerable degree on the efficiency
of the management and supervision that is applied.

And second, that intermodal services may require cooperation between different transport enterprises and
agreements made by such enterprises will have to comply
with EU competition law.

The third set of measures to be examined is that of technical

harmonization, particularly to guarantee the interconnection
of intermodal systems and the inter-operability of mobile
equipment. Additionally, compatible information systems must
be developed.

The fourth step that is necessary is to overcome the

problems associated with the different liability regimes that
apply to intermodal operators.

And finally, the fifth step concerns the development of transEuropean networks for different modes and their progressive
integration.

The European Directive

The purpose of the Directive was stated to be the

encouragement of combined transport by freeing it from all
quantitative restrictions and by elimination of various
administrative constraints that still exist in the field of road
transport.

These liberalization measures were intended to relate to road

journeys of limited distance in order to result in a real
reduction in road congestion. Among the liberalization
measures indicated were so-called stimulation measures,
the reduction of taxation on the use or possession of
commercial vehicles to the extent that they are carried by rail,
and exemption of the initial and final road haulage journey
legs from compulsory tariff regulations. Additionally, it said,
the access of own-account operations to combined transport
must be facilitated.

The combined network

For all the reasons why more freight should be

consigned by combined roadrail transport
(particularly the environmental issue) the
Council has adopted a union-wide network of
routes, which would allow the passage of the
standard loading units authorized within the
union. It acknowledged that creation of the
network required a series of works to be
undertaken to ensure its rapid introduction and
full market operation and that some of these
works were particularly urgent and would
require launching as soon as possible in their
first phase.

Intermodality and Intermodal

Freight Transport in the EU
This document recognized that a business as
usual approach would not solve the future
problems associated with transport. It
acknowledged that the efficient and balanced use
of existing capacities in the transport system was
a key challenge and defined key actions
necessary for what was hoped to be the
development of a step change from the then
current approach. This communication defined a
set of objectives for the development of: a
framework for an optimal integration of all
different modes so as to enable an efficient and
cost-effective use of the transport system through
seamless, customer-oriented, door-to-door
services

 It set out four key strategies to stimulate the development

of intermodal transport in the overall context of the
Common Transport Policy. These were steps to:
1. refine the trans-European networks and nodes;
2. realise the Single Transport Market by harmonizing the
regulations and competition rules;
3. remove obstacles to intermodality and the associated
friction costs (or costs that make intermodal transport
uncompetitive in comparison to uni-modal, i.e. single-mode
transport);
4. implement the Information Society in transport.
It also advocated an intermodal transport system which
encourages co-operation and complementarity between
the transport modes, and which favours competition
between transport operators.

The EU White Paper: Time to

Decide
The Time to Decide document defined a
number of very important intermodal-related
issues. First and foremost was the recognition
that as the demand for transport keeps
increasing, the Communitys answer just
cannot be to build new infrastructure (i.e.
especially roads) and open up new markets.
The transport system needs to be optimized to
meet the demands of both enlargement and
sustainable development.

 The key issues in regard to intermodal transport

are as follows:
revitalizing the railways,
improving the quality of the road transport
sector,
promoting transport by sea and inland
waterway,
turning intermodality into reality,
building the Trans-European Transport
Network,
improving road safety,
adopting a policy on the effective charging for
transport.