Global Logistics and Supply Chain Strategies - September 2008 - (Page 48)

plans to extend the practice further “because we can only reduce a ship’s speed to a certain extent,” NYK has said. NYK is working to reduce fuel consumption as another means of cutting CO2 emissions and operating expense. A “Save Bunker” campaign was launched in October 2005 to fine-tune marine operations, optimize vessel routing and embrace new technologies toward that end. Examples include the use of weather forecasts for improved route planning, fuel additives to promote conservation and prevent corrosion, and experiments in fuel emulsification. Beyond the container business, NYK is building a series of car-carrying “Ecoships” which are expected to yield energy savings of 50 percent over their predecessors. The gains will come in such areas as partial solar power generation, more efficient cargo handling, better propulsion systems and a more streamlined hull design. With 800 vessels in operation, and 1,000 expected by 2010, NYK believes it must be positioned “at the forward edge in terms of all these issues, because it’s the right thing to do,” Keller says. Vessel pollution is a particular concern for carriers in the U.S. domestic trades, whose ships rarely stray far from shore. Horizon Lines Inc., one of the nation’s largest domestic operators, has adopted an environmental initiative called Horizon Green. The effort extends across the company’s ocean-shipping and logistics arms. It focuses on the four key areas of marine environment, emissions, sustainability and carbon offsets. A number of Horizon’s programs are geared to comply with provisions of the international Marpol convention for prevention of ship pollution, as well as the International Safety Management Code of the IMO. Sustainability efforts center on such measures as reducing empty rail and truck backhaul miles, cutting back on fossil-fuel consumption and using recycled materials in building containers. The carbon-offset program, known as Aero Green, allows customers to participate in cargo-neutral shipping through the purchase of offsetting environmental credits. It is being offered through the Horizon Logistics subsidiary. Horizon Lines currently operates a fleet of 21 commercial vessels. The five new vessels that it acquired this year for longer hauls are 35 to 40 percent more efficient in fuel consumption, according to Joe Breglia, vice president and general manager of ocean transportation services. Other efforts include the slowing of vessels, combined with a push for schedule integrity, and the use of low-sulfur fuels in California waters. “On-time arrivals are the primary concern of our customers,” Breglia says. “We’re knocking down silos between the ships and network-operations folks so they know precisely when they need to be there.” Efforts at Dockside On the port side, industry executives are pushing for global standards that would discourage local jurisdictions from formulating a host of conflicting rules. Earlier this summer, Congress passed a bill to implement international Marpol limits on vessel “We support lowering of emissions coming from vessels, whether en route or at dockside.” — Kurt Nagle of AAPA emissions of NOx, SOx and other types of pollutants. President Bush was expected to sign the measure. The U.S. has been negotiating certain amendments to previous Marpol rules that would further reduce emissions from oceangoing vessels. Those measures are expected to be adopted in October by the Marine Environment Protection Committee of IMO, but the U.S. wouldn’t have a final vote unless it ratified them at least three months prior to that date. The American Association of Port Authorities is among the groups backing the latest Marpol and IMO efforts. “We support the lowering of emissions coming out of vessels, whether en route or at dockside,” says AAPA president and chief executive officer Kurt Nagle. At the same time, the organization wants to leave it up to individual ports and regions as to how they will meet the new standards. AAPA is taking a more active role in cooperation with about a dozen port facilities. Along with the independent Global Environment & Technology Foundation, the group is engaged in a two-year process to develop new environmental management systems for marine terminals. The ports of Los Angeles and Corpus Christi, Tex., are among those that have used the process to gain certification under the international quality specification known as ISO 14001. When it comes to green efforts by ports and carriers in the U.S., Southern California is the center of attention. The region’s high levels of air pollution, combined with the dominant status of the ports of Los Angeles and Long Beach, make it a prime candidate for stricter environmental measures. The effort with the highest profile—and greatest degree of controversy—is the Clean Air Action Plan (CAAP), devised in tandem by the Los Angeles and Long Beach ports. The $2bn plan targets a 50-percent reduction in harmful emissions from ships, trucks, trains and terminal equipment. But two fees to be charged in connection with the program have drawn fire from industry interests. One is a “Clean Truck Fee” of $35 per loaded twenty-foot equivalent unit (meaning $70 for each 40-foot container), to pay for a $1.6bn program to replace older trucks moving containers in and out of the harbor area. The other is a $15 per TEU “Infrastructure Cargo Fee,” to fund $1.4bn in local improvement projects. Shippers and carriers have charged that the fees violate several laws pertaining to U.S. interstate commerce. They worry that other port areas will follow the example of Los Angeles and Long Beach and impose their own charges, creating a hodgepodge of local shipping fees. It’s uncertain whether they will actually come up with the money to mount a legal challenge, however. But one particular aspect of the CAAP—a requirement that independent owner-operators serving the ports go to work for unionized companies that have operating rights in the harbor area—is sure to be fought in the courts. “We will see litigation from the American Trucking Associations with respect to the concession agreement and employee-mandate requirement,” says John R. McLaurin, president of the Pacific Merchant Shipping Association (PMSA), an industry lobbying group. Mean- 48 SEPTEMBER 2008

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Global Logistics and Supply Chain Strategies - August 2008 Contents Editorial GL&SCS Exclusive Fast Forward Up Front Cover Story: Free The Enterprise: Busting Silos in the Supply Chain Business Process Management Merits New Look fromCorporate Strategists Ships and Ports Explore Many Ways to Go Green The Right Information Should Help Avoid Any Kind of Risk Industry Voices

Global Logistics and Supply Chain Strategies - September 2008

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