Green Freight Initiatives in China and Brazil

China Green Freight Initiatives

Transforming Transportation Roundtable Washington DC, January 27 2010

Ke Fang, Shomik Raj Mehndiratta, Holly KrambeckThe World Bank

World Bank: Low Carbon Freight Transport & Logistics Initiatives in China and Brazil

Green Freight Transport

Road Freight in China

• Trucks account for 54% of total transport sector fuel consumption in China.

• Road freight volume grew rapidly along with the fast growth of China’s manufactory-dominated economy.

19851986

19871988

19891990

19911992

19931994

19951996

19971998

19992000

20012002

20032004

2005

2005(adjuste

d)2006

2007

2007(adjuste

d)2008

0

200

400

600

800

1,000

1,200

Frei

ght T

on-K

ilom

eter

s (10

0 m

illio

n)

Total Freight Ton-Kilometers Transported by Road in Guangdong Province (1985 – 2008)


Energy Efficiency

• Energy efficiency in the sector remains very low. o Poor fuel economy of truckso A large portion of “empty miles”

• Energy efficiency technologies and practices are not well utilized, despite potential fuel savings and economic benefits

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Barriers on Energy Efficiency

• Market failure occurs mainly because:o Trucking companies reluctant to experiment with

new or unknown technologies o Lack of information and confidence on the

performance, cost and availability of fuel efficiency technologies

• National and local governments are reluctant to take “heavy-handed” measures, worried about their impact on economic growth

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Objectives of Green Freight Initiative

• Aiming to address the market failure by – providing better information and better confidence

in the performance of proved energy efficiency technologies and practices,

– increasing awareness and demand for energy efficiency technologies, and

– facilitating the increase of the technology supply in Chinese market.

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Areas & Steps for Policy Intervention

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1. Technologies

2. Behavior & Maintenance

3. Improved Logistics

4. Modal Shift


A Partnership Framework

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The Project Development Process

• Snowball-effect:

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a tiny-sized pilot testing

Dissemination Communication

Training

Developing a conceptual

framework for collaboration

Preparation of a demonstration project, incl.

suveys of the industry and

financing market


Pilot Testing

• Carried out in Guangzhou, 2008-2009– Technology testing on 14 trucks in three truck fleets

• Tire systems• Aerodynamics

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Pilot Testing: Tire equipment (a)

• Dual low rolling resistance tires: reduces rolling resistance

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Load and Inflation • 830 kPa• 5,000 kg

455/50R 22.5

RULE: For every 70 kPa under inflation is 1% penalty in fuel economy


Pilot Testing: Tire equipment (b)

• Aluminum wheels: reduces weight of wheel

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Pilot Testing: Tire equipment (c)

• Automatic tire pressure monitoring system: keeps tire pressure more constant

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Pilot Testing: Aerodynamics (a)

• Skirts: reduce wind underneath the trailer

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HDPE plastic will last life of trailer


Pilot Testing: Aerodynamics (b)

• Nosecone: reduces turbulence

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Pilot Testing: Aerodynamics (c)

• Gap fairing: reduces the tractor-trailer gap

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Distance between back of cab and front of trailer Trailer GapWill make difference in % of savings


Training and Overseas Study Tour

• Training workshops for government staff and enterprise management in Guangzhou

• Two-week tailor-designed training program (including site visits) in the US for senior officials• 17 directors, chiefs, and general mangers across different

government agencies in Guangdong, learned about:

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• Smatway Program (US EPA)• Freight Logistics (CS Robinson, Safeway, Port of Tacoma)• Emissions Policy (California Resource Board )• Green Freight Technology & Financing (CSS) • Vehicle Scrapping (Port of Seattle Truck Scrapping Program)


Dissemination/Communication/Collaboration

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Guangzhou Transport Committee

Guangzhou Environmental Protection Bureau

World Bank Project Management Office,

Guangzhou


Guangdong Demonstration Proj (1)

• Technology Demonstration– Energy Efficiency truck technologies demonstration

• 1500-1800 trucks

– Pilot testing of logistics operation technologies:• Pilot Advanced Brokerage Information System• Pilot “Drop-and-Hook” freight operations

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• Innovative Finance– Green Freight technology rebate

• based on the prevailing down payment rate for a truck loan

– performance-based payments• based on the prevailing interest rate of a truck loan

– better access for SMEs to commercial finance• creating quality pipeline projects for commercial

banks• sharing information between banks and SMEs

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• Large-scale Capacity Building– Policy research– Training for installation and operation of

technologies– Training for government officials and enterprise

managers– Marketing and branding – Awareness raising and information dissemination– “Green Freight Trade Fairs” and “Green Freight

Submits”

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Challenges Ahead

• Get the project implemented properly…– “Green Freight Trade Fairs”: mobilizing

stakeholders, particularly trucking companies and technology vendors

– Selecting participating companies– Installing and operating technologies– Monitoring and evaluation– Making incentive payments

• Keep the “Snowball” rolling and keep it “Cool”…– Nation-wide dissemination and consultation– Policy dialogue with national agencies– More demonstration and replication – Development of green finance market

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Brazil Green Freight Initiatives

Transforming Transportation Roundtable Washington DC, January 27 2010

World Bank: Low Carbon Freight Transport & Logistics Initiatives in China and Brazil

Georges DaridoThe World Bank


Brazil Green Freight Initiatives

• Majority of all freight in Brazil carried by trucks• Growth is expected to continue in net ton-

kilometers: 886 billion in 2005 to 1,607 billion in 2023 (PNLT 2007)

• Mainstreaming “Green Trucks” Project, Phase I:– Study and market surveys to understand the sector– Seeking partners to conduct pilot tests of:

• Innovative, energy-efficiency technologies• Improved behavior and maintenance practices• Improved logistics

– Technical assistance to design/evaluate tests and conduct policy dialog

– Technical site visits for officials– Workshop(s) to collect and disseminate findings

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Approach according to market segment

• Profile of trucks fleet in Brazil (>1.3 million) by engine/emissions technology and type of ownership:

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P2

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P3

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P4

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P5

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0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

597,219

48,755 71,668 98,18924,478

125,834

30,31663,171

186,592

108,075

2159

392524

1182

606

CooperativesCompaniesIndependent Owners

>20 yrs 6-20 yrs


Freight Management in São Paulo

• Area and time restrictions for trucks

• Urban Freight Vehicle (VUC): size and performance standard

• Distribution hubs and logistics platforms

• Exclusive corridors and bypasses: ring road and rail

• Tolling/pricing?• World Bank/GEF funded effort

to develop tools:– Freight origin-destination

study (commodity flows)– Urban freight transport

model

THANK YOU!Email: [email protected] [email protected]

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Project is a work-in-progress….lessons learned everyday! Questions and comments most welcome.

mailto:[email protected]

mailto:[email protected]

Green Freight Initiatives in China and Brazil

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