The Pivotal Role of UK Policy and Early Adopters in Financing the Decarbonisation of the UK Freight Transport Sector

The implications of climate change are becoming increasingly apparent, necessitating a swift and comprehensive response. One of the sectors where significant action is required is freight transport. In the UK, this sector contributes nearly 7% to the nation’s CO2 emissions. This number is projected to increase due to the surge in e-commerce and inexpensive transportation costs. However, the UK is positioned to be a leader in this area, with the potential to significantly decrease emissions from the freight sector through strategic policy decisions and investment in sustainable practices.

The Decarbonising UK Freight Transport Network

The Decarbonising UK Freight Transport (DUKFT) Network, funded by the UK Research & Innovation, has been operational for three years. Comprising of over forty academic, policy and industry organisations, the network has conducted six research projects and organised two stakeholder events to explore ways to encourage investment in UK freight decarbonisation.

Key Findings and Transition Pathways

The DUKFT Network’s synthesis report highlights the main findings, transition pathways, and investment gaps in each freight sector. It indicates that electrification is a shared requirement across all freight modes, making it a low-risk investment for public and private stakeholders. Renewable Fuels of Non-Biological Origin, such as hydrogen-based fuels like methanol and ammonia, could also play a critical role in specific niches for road and rail freight and are crucial for decarbonising domestic and international maritime freight.

Whole Freight System Analysis

The report emphasises the need for a comprehensive freight system analysis to inform the UK freight decarbonisation strategy. This analysis should include detailed information on infrastructure, vehicle/vessel fleets, and operational and technology specifications.

“There remains a clear need for identifying and articulating the least-cost configuration and strategy for UK freight decarbonisation. New Modelling approaches are required to address the challenges of simultaneous wholesale changes across all the transport modes. These models are sophisticated and take time to build but they are the only way of addressing complexity and they offer a low risk, cost-effective pathway to reducing uncertainty and accelerating investment.” – Professor Phil Greening, Joint Principal Investigator of DUKFT

Co-Creation Processes

In addition to comprehensive freight system modelling, co-creation processes have been identified as a successful tool for future research on UK freight decarbonisation. It is not only necessary for maximising the relevance and quality of research but also beneficial for creating and enabling shared visions within stakeholder communities.

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Role of Ports

The report suggests that UK ports can play a significant role in the freight sector’s decarbonisation. They serve as interfaces between modes (road, rail, and shipping) and represent locations where infrastructure and decarbonisation solution synergies are most likely exploited.

Stakeholder Collaboration

Bringing stakeholders from across the supply chain together is crucial in establishing opportunities and creating a platform to mobilise infrastructural investment.

“Early movers can mobilise and de-risk investment in the emergence phase of the transition by establishing alliances and initiatives, ahead of regulations. Alliances between cargo owners which aggregate local/regional demand for zero emission fuelled freight services, thereby creating long-term offtake agreements of future fuel usage between fleet operators and suppliers, can be highly valuable kickstart the diffusion of fuels and technologies.” – Dr Nishatabbas Rehmatulla, Co-investigator and project manager of DUKFT

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Role of Policy Makers

Policy makers have a vital role in setting clear, ambitious targets supported by effective policies, and acting on evidence on electrification, including shore power in ports and charging infrastructure for HGVs.

Transition Risks

Stakeholders carrying transition risk, e.g., financiers, should use tools such as the Science Based Target Initiative (SBTi) to ensure their investments are 1.5-aligned, i.e., rapidly moving away from dependence on fossil fuels.

Conclusion

The UK, with its commitment to sustainability and the right policies in place, can significantly contribute to the decarbonisation of the freight transport sector. By embracing a comprehensive approach that includes the whole freight system analysis, co-creation processes, stakeholder collaboration, and effective policy-making, the UK can serve as a global example in this crucial endeavour.

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