By Laura Schewel
Like the wires hidden inside my computer
as I tap out this sentence, or the billions
of neurons that fire before your eyes can
blink, global goods transportation—the
network of boats, trucks, cars, ports,
warehouses, roads, and railroads that get
our stuff to us—is a dizzyingly complex
system. Also known as “freight,” this is
a system that must function around the
clock for the most simple acts of our
daily lives to work: making coffee in the
morning, taking notes in class, or reading
this RMI Solutions after dinner. Figure 1
illustrates the transportation involved in
creating and delivering this newsletter to
you.
This system is not just complex, it’s
essential to modern life: in 2005, an
average of 68 tons of goods moved 15,310
miles in the United States for each U.S.
citizen. And that’s only for the goods
shipped to, from, and within the nation.
It doesn’t include international travel, such
as the journey raw materials from South
Africa take to reach factories in China
where they are processed into electronic
goods before being sent to the United
States.
Yet while essential, freight comes with a
large and growing environmental cost: at
least 10 percent of global greenhouse-gas
emissions are linked to freight, along with
17 percent of U.S. fuel use and 30 percent
of U.S. nitrogen oxide emissions.
Figure 1: Geographical distribution of freight transport involved in
delivering this newsletter to Washington DC
While freight has accomplished massive
gains in efficiency and productivity in the
last hundred years, RMI is researching
how we can reduce the 10 percent of
greenhouse-gas emissions due to freight by
tackling systematic inefficiencies that waste
energy and produce unnecessary pollution.
Th e freight system’s complexity has
derailed many attempts to reduce its
energy used and pollution (including some
of RMI’s own past projects). Based on this
experience, RMI recently came up with a
new approach: organize the system around
one simple, common denominator and see
if it can be used as a lever to both better
understand and improve the entire system.
Fortunately, freight has at least one iconic
and ubiquitous rallying point: the shipping
container.
The shipping container: thinking
inside the box
Three-quarters of all general cargo is
transported in shipping containers. These
steel boxes, now familiar sights on massive
ships or stacked up in ports, are a relatively
recent invention. In 1956 transport mogul
Malcolm McLean first developed the
shipping container as a way to improve
his trucking business. Today, only 50 years
later, containerized shipping has enabled
globalization, and containerized shipping
and port services alone are a $370-billion
business.
At first glance, the container seems to
directly affect only the shipping industry,
which accounts for only 1.5–3 percent of
global greenhouse gases. But the shipping
container is linked to several other sectors
in the transportation system that together
represent a large source of environmental
degradation (see Figure 2).
So how could a new shipping container
help this system? The possibilities are
huge, and our research reveals new options
every day. One intriguing option would
be reducing the weight of the container,
which would lead to a variety of benefits
including:
- Reduced burden from moving
empties:most
containers are filled with low-density
products (like Barbies or paper cups) so the
weight of the container itself can be 10 to
20 percent of the gross weight. Reducing
the container weight would decrease the
amount of fuel needed to haul these loads.
- The ability to put more goods in each
container, thereby reducing the total
number of containers:some containers
aren’t filled to their maximum capacity
because they hit weight limits. Reducing
the container’s weight by 300 pounds
means putting 300 more pounds of goods
inside each container, which can reduce
the total number of containers and save
trips.
- Reduced burden from moving
empties:the trade imbalance between the
producing and consuming nations (e.g.,
China and the U.S.) means that up to 50
percent of container “trips” are empty, and
repositioning empty containers to meet
cargo requires a lot of truck and barge
trips (and money). Reducing the weight of
empty containers will reduce engine loads
and the amount of fuel necessary for this
currently unavoidable inefficiency.
So if lightweighting would be such a great
boon for fuel (and hence, cost) savings,
why isn’t it happening? The problem lies
in the financial structure of the container
industries. Lightweighting means each
container will cost more to build. Th e chief
beneficiaries of better tracking (terminal
operators, truckers, rail companies) don’t
always have a financial role in the design or
purchase of containers (where the decision
to invest in lightweight materials would
be made) and when they do, working
together to allocate the benefits would be
quite complex. Even though the whole
system would save money from reduced
fuel use, the incentives aren’t properly
aligned to push the lightweighting decision
forward.
Of course, lightweighting is just one
innovation we’re exploring. Others include
tracking to optimize the use of container transporting
vehicles, improving security systems to reduce scanning
bottlenecks, improving the
efficiency of refrigerated
containers, and more.
These ideas underscore
the most important aspect
of RMI’s whole-system
approach: combining our
knowledge of the best
environmental options with
a detailed understanding
of the business, financial,
and cultural systems
that influence goods
transportation—and,
working on innovation
that incorporates all those
systems.
To accomplish this we’re
seeding the development of
a consortium of companies,
with one representative from
each section of the value chain shown
in Figure 2—such as a port operator, a
shipping line, a retailer, etc. Using our
partners’ combined knowledge of their
own businesses and technical systems,
and their collective wisdom about gaps
in the shipping system, we will—during
an extensive research phase—develop
the environmental and business case
for a new kind of container. That will
be followed by a consortium-wide
Innovation Workshop—RMI’s process
that we have used to great effect in sectors
ranging from semiconductor fabrication
to mining and automotive design. The
Innovation Workshop will address both
technical innovations and business model
innovations.
Figure 2: How containers play into the freight system
Conclusion: Putting the (Freight)
System in the (Global) System
To fully realize RMI’s whole-systems
approach with respect to containers, the
final step is to consider how the freight
system is embedded in the global system,
and how any changes we propose influence
that global system. This may allow us
to find more hidden benefits of a new
container; it also ensures that we watch for
unintended consequences.
Let’s return to our original example
of the newsletter: if we optimized its
transportation footprint in a vacuum,
by, say, facilitating a system in which all
containerized goods were transported as
few miles as possible, we would select
paper from a mill close to our Colorado
printers and one that uses trees logged
as close by as possible. We might not use
recycled paper, which must be shipped
for processing purposes, and we would
probably not concern ourselves about the
management of the forest from which
the pulp was obtained. The unintended
consequences of focusing just on the
transport footprint are clear: more trees
(from a potentially fragile forest) would
be cut down leading to all the terrible
consequences of deforestation.
Creating an efficient freight infrastructure
is necessary, but not sufficient. Th us, the
container is an important leverage point
for RMI to make a short-term impact, and
an excellent first step towards the ultimate
goal: making the entire goods system more
sustainable.
Laura Schewel is an analyst with MOVE,
RMI’s Transportation Innovation Group.
What can you do to reduce the
impact of moving your stuff?
Because freight issues are so complex,
there are no 100 percent sure-fire ways
to have a smaller impact. However, the
following actions can usually reduce
your freight footprint:
- Buy locally, and make sure the
product is appropriate for your locality
(that means don’t buy strawberries
grown in a hot house in January in
Denver, or local wood if your forest
can’t sustain logging) and that the most
efficient vehicle available transports it;
- Combine your errands or arrange for
delivery: the trip from a store to your
home can have the biggest impact in
terms of goods transportation. Fewer
trips are better. And a delivery service
usually maximizes the efficiency of its
deliveries each day;
- Don’t buy or send goods via air; and,
- Buy less stuff.
