Freight decarbonization is a hot topic at a future supply chain event

Company

About 84% of New Zealand’s export cargo value is transported by sea. Photo/Michael Craig

Failure to reduce carbon emissions in New Zealand’s export supply chain could negatively impact trade deals, a summit on the country’s freight future has heard.

Acting Director General of the Department for Transport, Bryn Gandy, told the two-day Freight Futures event in Auckland that among the significant challenges facing the freight and supply chain system, climate change and international developments were two major areas to consider.

Population growth and density and digitalization and technology were the other two.

Gandy said that in developing a freight and supply chain strategy, the department and the sector faced “real structural challenges” and whether he expected supply chain congestion issues Covid-related supplies are slowly waning, even without them changes were needed by the industry itself.

“I think people were really surprised in 2020 when we started having shortages (of supply and freight). Suddenly everyone was a freight expert. I think we would have had a lot of biscuits from alternative if we had tried to organize a workshop (on the supply chain) before that.”

Gandy described the freight and supply chain issues paper recently released by the ministry in New Zealand as “a primer for a few years of work where the government could work closely with the industry.”

The concept paper, which received 83 submissions in response and is a precursor to a formal supply chain strategy, said New Zealand needed to prepare the freight and supply chain system for substantial change , including decarbonization.

He said that over the next 30 years, the system will play a crucial role in transforming the transport sector towards a low-carbon future. This new future would require the system to produce far fewer emissions and adapt to the impacts of climate change, while managing the pressures of growing consumer demand, geopolitical uncertainty and growing vulnerability to disruption.

Gandy said at the summit that with New Zealand’s population expected to increase by 1.2 million and freight volumes expected to increase by 55% during this period, there was a clear need for the chain first strategy of country supply.

Authors of issue papers had called for a long-term infrastructure investment planning pipeline to give industry participants certainty to plan their own investments, he said.

They also spoke on issues of consent and land use planning, the need to support an intermodal freight system and a more structured approach to the port side of the supply chain. There was broad support for improving freight data collection and sharing. Respondents reported labor issues across the industry.

Gandy said another area of ​​concern was the cost to small businesses in the sector of transitioning to the necessary changes “given that the costs are often borne by those who can least afford it.” New Zealand was a country of mostly small businesses, he noted.

The government wanted to take a more active role in supply chains, Gandy said. However, there were many things only industry could do, and some things only government could do, such as road projects and the signing of international treaties.

In response to a suggestion from the summit audience that the ministry was not in favor of hydrogen as an alternative fuel for heavy vehicles, Gandy said he had an “open mind”.

“We are very interested in fuels and fuel-related infrastructure. We are open to hydrogen, but it is clear that it will not be deployed on a large scale in the short term.”

Gandy said there may well be a need for investment in data collection for the sector.

Jessica C. Bell