European Port Industry Sustainability Report 2017
Rapid Exchange System + PPRISM Governance Fact Finding Study
European Port Industry Sustainability Report 2017
SECTION 1: MARKET TRENDS AND STRUCTURE INDICATORS ........................................ 5 LINKAGE GDP TO EU PORT TRAFFIC ............................................................................. 6 THE EVOLUTION OF THE GDP MULTIPLIER .................................................................. 7 REGIONAL CONTAINER TRAFFIC DEVELOPMENTS . Erreur ! Le signet n’est pas défini. THE TOP 15 CONTAINER PORTS ................................................................................. 10 TOP EU28 TRADE PARTNERS 2016 ............................................................................. 11 EU28 MERCHANDISE TRADE (2016) ........................................................................... 12 EU28 MERCHANDISE TRADE EVOLUTION .................................................................. 13 VESSEL SLOT CAPACITY OF CONTAINERS CARRIERS –JULY 2017 .............................. 14 PERFORMANCE OF CONTAINERS LINES ..................................................................... 15 ALLIANCE MARKET SHARE ON LOOPS ....................................................................... 16 THE EVOLUTION OF PPP FOREIGN ENTRY STRATEGIES ............................................. 17 PROFITABILITY AND RELIANCE ON ASSETS FOR TRADERS ........................................ 18 THE STRATEGIC ROLE OF TRADERS ............................................................................ 19 THE GENERATION OF MED HUBS ............................................................................... 20 TRANSHIPMENT INCIDENCE 2014 .............................................................................. 21 TRANSHIPMENT AND EMPTIES INCIDENCE EVOLUTION ........................................... 22 TRANSHIPMENT INCIDENCE PER REGION .................................................................. 23 GLOBAL CONTAINER HANDLING VOLUMES .............................................................. 24 CONTAINER PORT PROFILES IN EUROPE .................................................................... 25 SECTION 2: SOCIO-ECONOMIC INDICATORS ................................................................. 26 PORTOPIA’S MODEL FOR SOCIO-ECONOMIC INDICATORS ....................................... 27 SIMULATION EXAMPLE .............................................................................................. 28 SECTION 3: ENVIRONMENT, HEALTH, SAFETY AND SECURITY ..................................... 29 THE SAMPLE OF RESPONDENTS ................................................................................. 30 ENVIRONMENTAL MANGAMENT INDICATORS ......................................................... 32 ENVIRONMENTAL MONITORING INDICATORS .......................................................... 34 TOP 10 ENVIRONMENTAL PRIORITIES ....................................................................... 35 SERVICES TO SHIPPING ............................................................................................... 36 CONCLUSION .............................................................................................................. 38 SECTION 4: LOGISTIC CHAIN AND OPERATIONAL PERFORMANCE INDICATORS ......... 39 LSCI EVOLUTION (EU) ................................................................................................. 40 LSCI EVOLUTION (WORLD) ......................................................................................... 41 TIME SPENT IN PORT (NEW INDICATOR, BASED ON UNCTAD AND MARINE TRAFFIC DATA) .......................................................................................................................... 42
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European Port Industry Sustainability Report 2017
SECTION 5: GOVERNANCE INDICATORS ........................................................................ 48 SEAPORTS REMAIN UNDER PUBLIC OWNERSHIP BUT ARE MOVING TOWARDS MORE INDEPENDENT BUSINESS-LIKE MANAGAMENT .............................................. 49 Share of commercialized entities through the EU Port authorities ......................... 50 MAIN PORTS SERVICES ARE IN PRIVATE HANDS ....................................................... 51 A GROWING COOPERATION TREND .......................................................................... 52 A STRONGER ‘LICENCE TO OPERATE’ OF PORT AUTHORITIES .................................. 54 Developing the port hand in hand with the local community and key stakeholders ................................................................................................................................. 54 Building a beneficial relationship with employees and the local community ......... 55 Urban ports and societal integration of port activities ............................................ 56 PORT AUTHORITIES ARE FACILITORS AND SUPPORTERS OF THE ENERGY TRANSITION ................................................................................................................ 57 Ports are main entry points of energy commodities ............................................... 58 Ports are locations for energy production ............................................................... 59 Electricity provision ................................................................................................. 59 Energy management is a key concern of port authorities ....................................... 59 SECTION 6: USER PERCEPTIONS OF PORT QUALITY ...................................................... 61 QUALITY OF PORT INFRASTRUCTURE EVOLUTION (EU) ............................................ 62 QUALITY OF PORT INFRASTRUCTURE EVOLUTION (WORLD) .................................... 63 ABOUT THE ICT TOOL “USERS’ PERCEPTIONS” .......................................................... 66 THE ULTIMATE OBJECTIVE ......................................................................................... 66 PILOT IMPLEMENTATION OF THE ICT TOOL “USERS’ PERCEPTIONS” ....................... 66 Overview of outcomes ............................................................................................. 66 “State of the European Ports” Report ..................................................................... 67 GAP Analysis ............................................................................................................ 84
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European Port Industry Sustainability Report 2017
INTRODUCTION This report serves as the second Sustainability Report at the level of the European Port Industry. Following the projects on the development of European wide port performance indicators, such as PPRISM (see pprism.espo.be) and PORTOPIA (see www.portopia.eu), it consolidates both the relevant outputs and insights of these projects, but at the same time aims to be much more than that, integrating data and insights from other sources such as, among others, UNCTAD, OECD, World Bank, Eurostat, PortEconomics.eu, selected academics and selected private data suppliers. It is set-up along 6 dimensions, in line with the principles of integrated reporting: -
Market Trends and Structure indicators Socio-Economic indicators Environmental and Occupational Health, Safety and Security indicators Logistics Chain and Operational Performance indicators Governance indicators User Perceptions on Port Quality indicators
Currently, the report focuses on leveraging existing datasets present within the European Seaports Organisation (ESPO – the leading trade association for European ports), such as the Rapid Exchange System for traffic figures, and the ECOPORTS project. The Market Trends and Structure as well as the Environmental section of the report are thus currently the most developed sections. For the other categories, we currently refer to other sources, or highlight the developments underway in the PORTOPIA project. Finally, we believe the report can grow substantially, integrating insights from the other stakeholders present within the European port industry such as the trade associations of terminal operators, the pilots, the tugowners, the boatmen, and other related assocations such as the AIVP/IACP (International Association of Cities and Ports). We hope the report can serve stakeholders within and outside the industry to better understand the major tendencies within the industry, stimulating discussion among stakeholders and leading to strategic alignment between stakeholders to further enhance the competitiveness of the European port industry, and keep it in its leading position on a global level. For more information and background on the various sections of the report, please contact the PORTOPIA project coordinator (
[email protected]) or the following experts:
Market Trends and Structure indicators (
[email protected]) Socio-Economic indicators (
[email protected]) Environmental and Occupational Health, Safety and Security indicators (
[email protected],
[email protected]) Logistics Chain and Operational Performance indicators (
[email protected]) Governance indicators (
[email protected],
[email protected]) User Perceptions on Port Quality indicators (
[email protected]) 4
European Port Industry Sustainability Report 2017
SECTION
1: MARKET TRENDS AND STRUCTURE INDICATORS
The market trends and indicators were developed based on the results of work package one of the Portopia project. The following section presents these main results, which were extracted from a myriad of data sources like ESPO RES+, the Portopia datacenter, Eurostat, World Bank, renowned academic authors, etc. Information can roughly be grouped into three subsections. First, we discuss the macro indicators, GDP, main traffic evolutions, the impact of China and international trade etc. Second, we discuss specific trade patterns within the European port system. Third, we zoom in on the changing surrounding landscape, including the evolution of container alliances and the growing importance of traders.
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European Port Industry Sustainability Report 2017
LINKAGE GDP TO EU PORT TRAFFIC Annual growth port throughput and real GDP in EU28 6% 4% 2% 0%
-2%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
-4% -6% -8% -10% -12% Annual growth total seaborne goods handled (EU28)
Real GDP growth per annum (EU 28)
Source: based on data Eurostat Modest growth in seaborne goods handled With a total throughput estimated at 3.84 billion tonnes in 2015, the European port system still ranks among the busiest port systems in the world. The strongest growth figures were obtained before 2008, partly driven by fast growing container throughput, i.e. an average annual growth rate of 10.5% in the period 2005-2008 and 7.7% in the period 2000-2005. Because of the crisis, European ports decreased 12.1% in 2009, and somewhat bounced back in 2010 to 3.67 billion tons (+5.9% compared to 2009), but over the past few years sustained growth remained difficult, with a strong 2011 at +2.6%, a relapse in 2012 and 2013 (at -0.8% and -0.5% respectively). The years 2014 and 2015 showed a modest growth of 1.9% and 1.4% respectively. Since 2012, growth in seaborne cargo throughput is mostly below real GDP growth.
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THE EVOLUTION OF THE GDP MULTIPLIER
15%
15
10%
10
5%
5
0% -5%
0 2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
-5
-10%
-10
-15%
-15
-20%
-20
GPD multiplier
Annual growth
Real GDP growth, TEU growth and GDP mutiplier for EU28
Real GDP growth per annum (EU 28) Growth in container throughput (basis = TEU)
GDP Multiplier (right axis)
Source: based on Eurostat and Notteboom (2016) Container market shows modest recovery since 2009 The total TEU handled in European ports (EU28) suffered from the economic and financial crisis which started in late 2008. The year 2009 brought a TEU drop of 14% in the EU port system with some ports recording even much higher losses (e.g. Hamburg saw a TEU volume drop of 28%). Since 2012, growth figures in container handling show a modest growth between 2.5% and 5% per annum, with the exception of 2015. Comparing TEU growth and GDP growth gives the GDP multiplier. In 2015, this value was negative given the drop in TEU volumes.
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REGIONAL CONTAINER TRAFFIC DEVELOPMENTS
Growrh 2007-2016 in million TEU
3 2.5
-25%
Greece
2 1.5
Spanish Med West Med Hub
1 0.5
Kattegat/The Sound
-50%
Rhine-Scheldt Delta
0
Portugal North Adriatic Gdansk Bay
UK SE Coast Ligurian range North Germany
South Finland 0% 25% 50%
-0.5Seine Estuary
Black Sea West
75%
100%
125%
150%
175%
Growth 2007-2016 in % (basis = TEU)
-1
Source: Notteboom (2017) Growth 2007-2016 for multi-port gateway regions in Europe - Growth patterns strongly differ per port region in Europe Total container throughput in the EU increased by 13.9% between pre-crisis year 2007 and 2016. But growth patterns differ per port region. The Rhine-Scheldt Delta (with Rotterdam, Antwerp and Zeebrugge as main container ports) handled 24 million TEU in 2016. Compared to 2007, the Delta’s container throughput increased by 2.47 million TEU or 11.5%. The share of the Rhine-Scheldt Delta in total EU container throughput shows moderate fluctuations in the 23-25% range since 2007. In 2016, its share reached 23.4% compared to 23.9% in 2007. The North-German container ports (initially only Hamburg and Bremerhaven, but since 2012 also Wilhelmshaven) managed to increase the joint traffic share in Europe from 13% in the late 1990s to 16.5% in 2007. However, sharp volume drops in 2009 brought the traffic share below 15%. By 2012 the region’s position recovered to 15.8%, but then gradually slipped to 14.6% in 2016. The North German port system recorded a minuscule growth of 0.6% between 2007 and 2016 to reach 14.94 million TEU in 2016. The Seine Estuary (Le Havre, Rouen) is still below the 2007 volume, but its stable volume share remained stable in past few years.
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European Port Industry Sustainability Report 2017
Southern European ports (all indicated in red) are on the rise. This is particularly the case for the Greek container port system (effect of volume rise of Piraeus), the Portuguese ports (mainly due to the success in the port of Sines) and the North-Adriatic ports. Before the crisis, the Spanish Med port region (Valencia, Barcelona, Tarragona, etc..) recorded a growth of its European share from 4% in 1993 to 6.3% in 2007. By 2016, its share increased further to 6.9% representing a growth of 1.34 million TEU or 23.6% compared to 2007. Ligurian ports in Italy represent some 4.3% of the total European port volume in the past few years, a decline compared to 6-7% throughout the 1980s and 1990s. The port system saw a modest growth of 9.8% in the 2007-2016 period. The 'pure' transhipment hubs in the West Med (Algeciras, Gioia Tauro, Marsaxlokk, etc.) emerged in the mid 1990s mainly to serve the growing number of Asia-Med services. Combined, these hubs saw a growth of 12% and 1.2 million TEU in the 2007-2016 timeframe. In the 2007-2016 period, the UK SE Coast port region added 1 million TEU to its container throughput. This represents a growth of 14.8%. Felixstowe and Southampton remain the main gateways in the UK container port system, while Thamesport gradually lost its role as port of call on the major east-west trade routes. The relatively new London Gateway is starting to have an impact on competitive dynamics as well. In the last couple of years, the ports in the Bay of Gdansk are witnessing a healthy growth and an increasing traffic share in Europe (now 1.9% compared to 0.8% in 2007 and 0.5% in 2004). In the 2007-2016 period, the Gdansk bay port region added 1.23 million TEU to its container throughput or a high growth of 173%. This is mainly due to the growth of the DCT facility in Gdansk. The success of the Gdansk bay port region is in contrast to the modest traffic losses in the port system at the entrance of the Baltic (Kattegat/the Sound) and South Finland. The western part of the Black Sea port region recorded a decline of some 640,000 TEU in the 2007-2016 period which represents a traffic loss of some 42%. This development demonstrates that shipping lines, for the time being, prefer a hub-feeder model in the Med to service the Black Sea area instead of direct deepsea calls in the Black Sea. Multi-port gateway regions (% in European T EU traffic ) 1. Rhine-Scheldt Delta 2. North Germany 3. Seine Estuary 4. Portugese Range 5. Spanish Med range 6. Ligurian Range 7. North Adriatic 8. UK Southeast Coast 9. Gdansk Bay 10. Black Sea W est 11. South Finland 12. Kattegat/The Sound ALL 12 multi-port gateway regions Stand-alone gateways W est Med hubs
2008 24.7% 16.8% 2.9% 1.4% 6.9% 4.5% 1.6% 7.4% 0.9% 1.7% 1.6% 1.9% 72.1% 16.6% 11.3%
2012 24.1% 15.8% 2.6% 1.8% 6.7% 4.1% 1.9% 6.4% 1.7% 0.9% 1.4% 1.7% 69.0% 20.2% 10.7%
2014 23.4% 15.4% 2.6% 2.4% 6.4% 4.1% 2.0% 6.8% 2.0% 0.8% 1.2% 1.6% 68.8% 20.1% 11.1%
Gatew ay port
2015 23.8% 14.8% 2.6% 2.4% 6.6% 4.4% 2.2% 7.6% 1.8% 0.9% 1.2% 1.6% 70.0% 19.2% 10.8%
Transhipment/i nterli ni ng port (transhipment incidence >75% ) Gatew ay port also handling substantial transhipment flow s Finland (N ) (M ) (O )
11
Sweden
Norway
M ulti-port gatew ay region
Rauma
S tock holm
T allinn
Estonia
A arhus
D ublin
H ull 1
(K ) (H ) (J) (I ) (G )
8
(D ) (F )
(B ) (C )
Le H av re
(L)
NL
Poland
Germany
Ukraine Czech Republic Slovakia Austria
Switz.
M arseille-F os
B ilbao
Leixoes
4
Portugal
G enoa S av ona
S ines A lgeciras
7
Liv orno
6
Bosnia& Herz.
Romania
C onstantza 10
V arna
Serbia Bulgaria
B urga s
Mace.
Italy
T hessalonik i
Alb. N aples
5
T aranto
Turkey
Greece
C agliari
S ev illa
Morocco
La S pezia
T arragona
V alencia
C adiz
Rav enna
B arcelona
Spain
Hungary
T rieste K oper Croatia Rijek a
V enice
S antander
V igo
Belarus
G dansk
9
Belg.
B ordeaux
G ijon
Russia
K laipeda
G dy nia S zczecin
France
N antes-S t-N azaire
F errol
Latvia
Lithuania
2
3
Am ericas
Lisbon
Lübeck H am burg
Rouen
B rest
M alaga
P iraeus G ioia T auro
Main shipping route
Algeria
Source: Notteboom (2010; 2016)
(E ) (A )
Riga
C openhagen
(P )
Liv erpool C ork
Am ericas
V entspils
H elsingborg M almö
Den.
T eesport
Ireland
S etubal
G öteborg
12
G rangemouth
UK
gatew ay s
M ain shipping route
Estonian-Russian por t r egion
Source : Not te boom (2010; 2016)
B elfast
M ain stand-alone
S t-P etersburg U st-Luga S illamae
T urk u
B ergen O slo
Tunisia
Middle East – Far East M arsaxlok k
Cyprus
(A) Antw erp (B) Zeebrugge (C) Ghent (D) Rotterdam (E) Amsterdam (F) Dunkirk (G) Southampton (H) Felix stowe (I) Thamesport (J) Tilbury (K) London Gatew ay (L) Bremerhaven (M) Kotka (N) Hamina (O) Helsinki (P) Wilhelmshav en
Malta
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European Port Industry Sustainability Report 2017
THE TOP 15 CONTAINER PORTS Total container throughput in 1000 TEU Rank Rank Rank Port 2016 2015 2007 1 1 1 Rotterdam (NL) 2 2 3 Antwerp (BE) 3 3 2 Hamburg (DE) 4 4 4 Bremerhaven (DE) 5 6 6 Algeciras (ES) 6 5 8 Valencia (ES) 7 7 7 Felixstowe (UK) 8 8 Piraeus (EL) 9 9 12 Marsaxlokk (MT) 10 11 5 Gioia Tauro (IT) 11 10 9 Le Havre (FR) 12 12 14 Genoa (IT) 13 14 10 Barcelona (ES) 14 13 13 Southampton (UK) 15 Sines (PT) TOP 15 TOP 3
2016 1000 TEU
Growth 2015/2016
Growth 2007/2016
12,385 10,037 8,907 5,487 4,760 4,722 4,016 3,675 3,080 2,797 2,519 2,298 2,238 2,037 1,513 70,471 31,329
1.2% 4.0% 1.0% -1.1% 5.5% 2.3% -0.7% 9.4% 0.5% 9.8% -1.6% 2.5% 14.6% 4.2% 13.8% 2.6% 2.0%
14.8% 22.7% -9.9% 12.2% 39.2% 55.2% 20.1% 167.7% 62.1% -18.8% -4.5% 23.9% -14.3% 9.0% 908.7% 15.0% 8.6%
Source: Notteboom (2017) based on port authority data Top 15 European container ports While in 2015 the top 15 ports still saw a small traffic decline of 1.6% compared to 2014, this time we have a modest growth of 2%. Barcelona, Sines, Piraeus, Algeciras and Antwerp record the highest y-o-y growth figures, while Felixstowe, Le Havre and Bremerhaven are the only ports with a traffic loss in 2016. The top 15 ports combined saw a rather unimpressive 15% increase in container traffic compared to pre-crisis year 2007. In nearly a decade, four of the 15 ports recorded container volumes in 2016 which still remain below the 2007 figures. Gioia Tauro and Barcelona are special cases combining a strong growth in 2016 with 2016 figures well below the 2007 container throughput. Star growers during the 2007-2016 period are found in southern Europe: Sines (9 times more volume), Piraeus (+168%), Marxaxlokk, Valencia and Algeciras. It mostly concerns ports which heavily rely on sea-sea transhipment volumes. When it comes to ports with a much stronger gateway/hinterland orientation, Antwerp and Genoa are the strongest growers. Only few changes took place when it comes to the ports that made it to the top 15. Piraeus was not in the top 15 in 2007. In that year, Constantza ranked no. 15 (1.41 mio TEU) and Zeebrugge no. 11 (2.02 mio TEU). Sines joined the top 15 only in 2016 filling the spot previously occupied by Zeebrugge (1.56 mio TEU in 2015).
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European Port Industry Sustainability Report 2017
TOP EU28 TRADE PARTNERS 2016
Source: based on Eurostat data China and the US remain most important business partners The top trade partners in 2016 are for export, the United States with 21% (18% in 2014), China 10% (same as in 2014), followed by Switzerland, Turkey, Russia, Japan, and Norway. For Imports, China leads with 20% of the total trade value (18% in 2014), followed by the US with 15% and Switzerland with 7%. In the period 2014-2016, Russia lost a position in the top ranking, both in imports and exports.
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European Port Industry Sustainability Report 2017
EU28 MERCHANDISE TRADE (2016)
Machinery and transport equipment dominate exports and imports also in 2016 Focusing on the distribution per sector, three categories dominate the exports: “machinery and transport equipment” (43%), “chemicals and related products” (18%) and “manufactured goods” (10.9%). The import segment is a little more fragmented, however machinery, manufactured goods and mineral fuels account for 80% of all imports, followed by chemicals (10.8%).
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European Port Industry Sustainability Report 2017
EU28 MERCHANDISE TRADE EVOLUTION
Source: Eurostat EU merchandise trade (in value) In the last year, the over-performance of exports against imports continued, but stabilized somewhat. The positive trend of exports against imports is expected to reasonably carry on in the next years. This shift in the morphology of EU trade flows with other economies should provoke several adjustments in the volumes and the types of merchandises transiting within European ports.
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European Port Industry Sustainability Report 2017
VESSEL SLOT CAPACITY OF CONTAINERS CARRIERS –JULY 2017
Source: aggregation Aplhaliner data of 13 July 2017 Consolidation and alliance formation in container shipping lead to market concentration Since 2014, the container shipping industry is witnessing a massive wave of carrier consolidation. In mid-2014, Hamburg Süd acquired CCNI (Compañía Chilena de Navegación Interoceánica). In December 2014, the merger between Hapag-Lloyd and CSAV (Companía Sud Americana de Vapores) was completed. In late 2015, NOL/APL and CMA CGM agreed on the sale of APL container division to CMA CGM. Early 2016 brought the merger between China Shipping and Cosco to form China Cosco Shipping Group. Hapag-Lloyd and UASC announce to merge in the same year. In late 2016, NYK line, MOL and K-Line announced to merge their container activities to form ONE (Ocean Express Network). In early 2017, Hanjin was formally declared bankrupt. In April 2017, the European Commission cleared the take-over of Hamburg-Sued by Maersk. In July 2017, COSCO announced it will acquire OOCL. The consolidation wave went hand in hand with a massive reshuffling in alliances. In early 2017, CKYHE, G6, 2M and Ocean Three made room for THE Alliance, Ocean Alliance and 2M. The latest consolidation wave is having a significant impact on the container carrier ranking. In 2010, the market was still characterised by three mega carriers with fleet capacities above 1 million TEU (i.e. Maersk, MSC and CMA CGM) followed by about 17 global carriers each having a slot capacity between 200,000 and 650,000 TEU. The carriers outside the top 20 were all niche players (regional and feeder operators). The graph shows the effect of recent M&A activity on the container carrier ranking. The group of medium-sized global carriers has virtually been wiped out. Yang Ming and HMM have become outliers in the new global carrier landscape. They are challenged to either join the top league through engaging in M&As or to become niche or regional players. ZIM has opted for the latter path. The latest round in M&A activity and alliance formation paves the way for a stronger influence of geopolitical factors in container shipping.
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European Port Industry Sustainability Report 2017
PERFORMANCE OF CONTAINERS LINES
Source: BCG analysis based on annual reports Freight rates at the root of alliances The alliances were mostly caused by the pressure on the freight rates, reducing EBIT margins and forcing scale increase. As can be observed, CMA CGM and Maersk Line are the scale leaders, allowing for the best revenues and optimal utilization of economies of scale. SITC and Wan Hai are niche players, generating large margins but lower revenues. The remainder is ‘stuck in the middle’ and is faced with an up or out scenario.
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European Port Industry Sustainability Report 2017
ALLIANCE MARKET SHARE ON LOOPS
Source: Alphaliner Weekly Newsletter, volume 2017, issue 14 Three alliances dominate the main East-West trade routes Between 2015 and Q2 2017, four alliances were operational in the container shipping market: 2M, Ocean Three, CKY(H)E and G6. The merger of China Shipping and Cosco to form China Cosco Container Lines (COSCOCS) and the acquisition of APL/NOL by CMA CGM were the first major market changes signalling major changes in the current alliance structure. Since Q2 2017, three major shipping alliances are active on the main east-west trade routes; the 2M alliance, the Ocean Alliance and THE Alliance. The Ocean Alliance operates the largest fleet capacity on the trans-Pacific trade, while 2M is market leader on the Europe-Far East trade.
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European Port Industry Sustainability Report 2017
THE EVOLUTION OF PPP FOREIGN ENTRY STRATEGIES
Land side terminals gaining market power through expansion As widely acknowledged by scholars and practitioners, international terminal operators (ITOs) have profoundly accelerated their process of overseas expansion in many geographic regions. As a result, a handful of players take the lead of this market, provoking an increasing consolidation from the supply side. Currently, the top 5 ITOs approximately control over the 40% of the overall port throughput worldwide. The graph above depicts the relative importance and evolution of the two PPP foreign entry strategies in the container port industry during the 1990–2010 periods.
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European Port Industry Sustainability Report 2017
PROFITABILITY AND RELIANCE ON ASSETS FOR TRADERS
Source: Meersman, Rechtsteiner and Sharp (2013) Traders gaining market power via vertical integration The commodity trading landscape has changed extensively over the past years. After World War 2, large trading companies, which used to dominate primary commodity trade throughout the 20th century, have undergone vast structural changes. The mutation of largely single-line commodity traders into multi-commodity traders now span the entire spectrum of commodities that enter world trade. Today, growing global profit pools, rising profiles of industry leaders and lower entry barriers have attracted a large number of players to the commodity trading market. The graph above presents an overview of the reliance on assets of some of the most important traders: while there is still a significant group of pure traders, quite a few traders have vertically integrated their activities and became asset-based, even controlling key storage facilities and assets.
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European Port Industry Sustainability Report 2017
THE STRATEGIC ROLE OF TRADERS
Source: Meersman, Rechtsteiner and Sharp (2013) Growing strategic role of traders in cargo and port routing (oil) Traders are playing a key role in all the stages of the process, which relate to the entire liquid bulk supply chain. They manage the highest crude and clean petroleum products. Gunvor Glencore, Trafigura, Vitol, Mercuria, and investment banks such as Morgan Stanley, JP Morgan have shares or hire storage farms. Also minor traders have quotas in storages. The impact of the traders in the flows of oil products through EU ports surely will depend on the internal oil demand and if the EU will overcome the crisis. If the EU won’t recover, the EU flows will be small and maybe tank storages will remain in overcapacity.
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European Port Industry Sustainability Report 2017
THE GENERATION OF MED HUBS
Source: Parola (2013) North African ports put pressure on Med range The Mediterranean ports are experiencing the fierce competition of newcomers located in North Africa, which find their competitive advantage in the following factors: a) cost advantages (lower cost of space and very low wages); b) “legislative” advantages (simplified administrative procedures for FDIs, governmental incentives, etc.); c) geographical position advantages (lower diversion distance respect to the trunk route Suez/Gibraltar); d) physical advantages (deep-water terminals with large backyard spaces).
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European Port Industry Sustainability Report 2017
TRANSHIPMENT INCIDENCE 2014
Source: Portopia calculation based on Drewry (2014) Med ports still largest transshipment incidence 2014 In 2013, the Med transhipment ports gained a substantial amount on their Northern counterparts. This comes as container shipping lines have been rationalising their service networks and replacing direct services to and from West Africa with transhipment from ever larger east-west mother ships passing through the Mediterranean. Gioia Tauro, Marsaxlokk and Algeciras have more than 90% transhipment. The Northern ports of Hamburg, Rotterdam and Antwerp are all below the 40% mark.
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European Port Industry Sustainability Report 2017
TRANSHIPMENT AND EMPTIES INCIDENCE EVOLUTION
Source: Portopia calculation based on Drewry (2014) Global transshipment & empties incidence The 1980 till 2000 saw a sharp rise in transhipment incidence, mostly due to the rise of the pure transhipment hubs like the West Med ports. Post 2000, a stabilization occurred with slower growth margins and a transhipment incidence levelling around 25-28%. The global transhipment incidence factor in 2014 registered 27.6% and has steadily retreated from a peak of 28.3% in 2008. The empties incidence, denoting the amount of empty containers has remained between 20% and 25% for the past 25 years.
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European Port Industry Sustainability Report 2017
TRANSHIPMENT INCIDENCE PER REGION
Source: Portopia calculation based on Drewry (2014) East regions transshipment, West regions lose transhipment The transhipment evolutions are strongly region dependent. As we can see from the figure above, the Western regions were faced with a small decline in transhipment: North West Europe -2.3%, West Med -2.8%. Their counterparts to the East outperformed them slightly, with growths in the Baltic region of 0.4% and the Black Sea region of 2.6%.
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European Port Industry Sustainability Report 2017
GLOBAL CONTAINER HANDLING VOLUMES
Source: Portopia calculation based on Drewry (2014) Stable evolution with small transshipment rise Absolute global volumes of container handling grew steadily over the past 10 years. If we compare 2004 to 2014, we find total handling +87%, full handling +79%, empty handling +118%, transhipment +93%. In relative amounts, transhipment grew faster than the other groups pre-2000, whilst stabilizing in the last two decades.
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European Port Industry Sustainability Report 2017
CONTAINER PORT PROFILES IN EUROPE
Source: Portopia calculation based on Drewry (2014) East regions gain transhipment, West regions lose transhipment North Italian ports and UK ports are predominantly involved in gateway functions. The load centres are situated in the Hamburg-Le Havre range; Barcelona and Valencia act as mixed ports. For these nodes, traditional gateway functions did not exclude the development of transhipment activities, which provide further business opportunities for increasing total throughput volumes and provide bundled services (combining gateway handling with transhipment) to main customers. A longitudinal analysis shows that the ports protagonist of transhipment in Europe remain the same within the overall period.
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European Port Industry Sustainability Report 2017
SECTION 2: SOCIO-ECONOMIC INDICATORS From a historical perspective, socio-economic impact indicators such as, inter alia, employment and value added have been important criteria to justify and show the economic contribution of port development to local communities as well as different levels of government. Whereas the communication of these impacts to local communities principally serves the creation of societal acceptance of port activity, the studies on which this communication is based on play a more important role as the competent governments use the outcomes as criteria for budget allocation of public infrastructure funds as well as the granting of permits allowing the port authority and the port firms to operate. In other words, port performance in terms of creation of employment and value added are important indicators to convince stakeholders of the necessity of port development and operations in their region or country. Out of PPRISM, two relevant socio-economic indicators were identified by European ports: direct employment and direct added value, to show the contribution of ports to the European economy. Moreover, the need for further harmonization was identified as well as the fact that only a few ports report on employment and added value at a structural basis. At present, only ca. 10 individual ports (Belgium, Netherlands, Germany) are able to present annually updated, and reliable figures on the employment and gross added value created within the area they manage, in some cases these data are managed externally. As a result, in order to provide aggregated figures on the EU-level, short-cut extrapolations are needed. For employment, based on PPRISM data and updates of the sample, we extrapolated in 2014 that direct employment in port areas amounts to approx. 1,1 million full-time equivalents (FTE). This figure comprises both cargo handling and other activities in the port area such as industry, trade, logistics, land transport services. Within these 1,1 million FTE, based on our data in Belgium and The Netherlands, around 40% is linked to cargo handling activities (as well as related activity taking place in the port, such as agents, tugs, repair, shipbuilding etc) - this is also considered the "maritime cluster". Based on the above and accounting also the indirect employment (i.e. supply of products and services to directly concerned firms in the port area), leading to a total impact of 2,5 million FTE (direct plus indirect), we could state that 1 FTE in the maritime cluster - or jobs related directly to the transfer of cargo (i.e. total of 400.000 to 450.000 FTEs) - supports at least 4 other jobs in the wider region (approx. the remaining 2 million FTE) either in the port area i.e. the industry / distribution / logistics / land transport, or outside the port area e.g. suppliers of maintenance services etc. not located in the port area. Within this area of performance, the aim of the PORTOPIA project is to provide ports with a direct employment and direct gross added value estimation tool, allowing more ports to report on these indicators based on a scientifically valid method, based on proxy indicators related to the amount of cargo (for maritime related employment) and the land use (for non-maritime related employment).
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European Port Industry Sustainability Report 2017
PORTOPIA’S MODEL FOR SOCIO-ECONOMIC INDICATORS
Source: PORTOPIA Deliverables Estimation models need to take into account port specificities An estimation model developed based on ‘smart proxies’ can overcome the issue of data shortages, and provide a solution to the need for these figures. Leveraging the extensive datasets from two best practices, i.e. the historically exhaustive datasets on 8 core TEN-T ports from Belgium and the Netherlands, general multipliers for port related activities were identified. For these best practices, see: http://havenmonitor.nl (in Dutch, version 2015) https://www.nbb.be/doc/ts/publications/wp/wp283en.pdf (in English, report June 2015 on the year 2013)
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European Port Industry Sustainability Report 2017
SIMULATION EXAMPLE
Source: PORTOPIA Deliverables Final steps in rendering the estimation model are underway While the research on the estimation model has shown good fits with the direct employment for the maritime cluster, larger differences between the estimation and actual employment reported has been observed for the non-maritime cluster (e.g. petrochemical industry, energy, associated logistics, etc.). Additional work will be done:
Inclusion of dry ports that are located close by the port (e.g. Italian example). The estimates can be improved through the inclusion of port profile variables. The research team is looking into the potential indicators for further implementation. The model estimates quite well the node function related employment (i.e. the maritime/transport cluster), based on the traffic related variables. For the location function related employment (such as industry), we still look for correlating variables. Currently we look at land use as proxy. Over the next period in time the data for land use for the Dutch and Belgian ports will be collected, after which we will statistically test the method for applicability to other ports in Europe.
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SECTION
3: ENVIRONMENT, HEALTH, SAFETY AND
SECURITY This section presents the updated results for the year 2017 of the European ports’ environmental performance. Selected benchmark performance elements are introduced and discussed. The data on these indicators are obtained from the responses of 91 EU ports to the EcoPorts SDM, a tool developed for identifying environmental risk and establishing priorities for action and compliance (http://www.ecoports.com/). Initially, the section introduces the sample of the respondent ports, mentioning the number of ports by country that contributed to the exercise, their geographical location and their size. Secondly, the results of the indicators are provided, being structured in the four categories of the PORTOPIA environmental indicators: i) environmental management indicators, ii) environmental monitoring indicators, iii) top environmental priorities and iv) services to shipping. The 2017 results are then compared with those from 2016, 2013, and variations and trends over time are highlighted. Finally, some conclusions are drawn.
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European Port Industry Sustainability Report 2017
THE SAMPLE OF RESPONDENTS
As mentioned, 91 ports participated in this assessment from 21 different countries. Table 1 below provides the list of EU countries represented, the number of participating ports of each country and the percentage. Spain and the United Kingdom are the countries that have more ports represented, 12% each one, followed by France with 11% of ports. Table 1: List of countries represented in the sample and the number of participating ports
Country Spain United Kingdom France Netherlands Germany Greece Sweden Norway Denmark Italy Croatia Ireland Finland Latvia Jordan Portugal Turkey Romania Estonia Morocco Lithuania
Number of ports 11 11 10 9 7 7 4 4 4 3 3 3 3 2 2 2 2 1 1 1 1
Percentage 12% 12% 11% 10% 8% 8% 4% 4% 4% 3% 3% 3% 3% 2% 2% 2% 2% 1% 1% 1% 1%
Figure 1 shows the geographic settings of the contributing ports. It demonstrates that the sample is reasonably well balanced concerning the location of the ports.
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Figure 1: Geographical characteristics of the sample Another characteristic of the sample that is studied is the tonnage of the contributing ports, in terms of millions of tons handled per year. Figure 2 demonstrates that most of the ports are small (<5 million tons) and medium (5<15 million tons) sized.
Figure 2: Tonnage characteristics of the sample Below, the results of the different indicators are presented according the aforementioned categories. The performance of 2017 is compared, whenever it is possible, with the performance obtained in the Sustainability Report 2016 (Puig et al, 2017) and with the ESPO review carried out in 2013 (Puig et al, 2015).
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European Port Industry Sustainability Report 2017
ENVIRONMENTAL MANGAMENT INDICATORS
This section provides the results of the environmental management indicators. These are 10 indicators that provide information about the management efforts that influence the environmental performance of the port. Table 2 below shows the percentage of positive responses to each of these 10 PORTOPIA indicators in the review of 2013, 2016 and 2017, so the variations over time are demonstrated. Table 2: Percentages of positive responses to the environmental management indicators
Indicators A B
Existence of an Environmental Management System (EMS) Existence of an Environmental Policy Environmental Policy makes reference to ESPO’s guideline C documents D Existence of an inventory of relevant environmental legislation Existence of an inventory of Significant Environmental Aspects E (SEA) F Definition of objectives and targets for environmental improvement G Existence of an environmental training program for port employees H Existence of an environmental monitoring program I Environmental responsibilities of key personnel are documented J Publication of a publicly available environmental report
2013 2016 (%) (%) 54 70 90 92
2017 (%) 70 97
% change 2013-2017 +16% +7%
38
34
35
-3%
90
90
93
+3%
84
89
93
+9%
84 66 79 71 62
89 55 82 85 66
93 68 89 86 68
+9% +2% +10% +15% +6%
The results demonstrate that the existence of an Environmental Policy is the indicator that has a higher percentage of positive response. Practically all the participant ports have defined an Environmental Policy. This percentage of positive response has increased +7% since 2013. The second highest percentages are the existence of an inventory of relevant environmental legislation, inventory of SEAs, and definition of objectives and targets, with 93% of positive response. The last two indicators increased 9% compared to the results published in 2013. The ranking is followed by the indicator of the existence of an environmental monitoring program. It is also interesting to point out that the indicator on the existence of an EMS has increased from 54% in 2013 to a 70% in 2017. As it can be seen, almost all the indicators have improved with respect to 2016. On the basis of these ten indicators, PORTOPIA has developed the so called Environmental Management Index. This is calculated on the basis of a specific weighting applied to the significance of these key environmental management components. It is argued that this index is particularly appropriate since it is a measure of competence and capability to deliver the environmental imperatives. The Environmental Management Index is calculated by multiplying the weightings associated to each environmental management indicator (see table 2 and formula below) to the percentage of positive responses. In other words, the final score is calculated by applying the following formula:
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European Port Industry Sustainability Report 2017
Environmental Management Index = A*1.5 + B*1.25 + C*0.75 + D*1 + E*1 + F*1 + G*0.75 + H*1 + I*1 + J*0.75. Where the value of each letter is the percentage of positive response divided by 100 (e.g. A is 0.7 in the results of 2017 as showed in table 2). The resulting index for the performance of the port sector in 2013, 2016 and in 2017 is provided in Table 3. Table 3: Environmental Management Index in 2013 and 2016.
Environmental Management Index
2013 7.25
2016 7.72
2017 8.08
The index value has increased year-on- year, following the trends of the environmental management indicators (see Table 2). Another significant point to highlight within this Sustainability Report is the number of ports that are EMS certified to an internationally recognised standard. A total number of 64 ports out of the 91 are EMS certified, 47 of them under ISO 14001, 6 under EMAS, and 26 ports have achieved the PERS certificate. The total number of certifications is in fact more than 64 because some ports are certified under more than one system. Figure 3 presents the results of the EMS certificates broken down into categories.
Figure 3: Distribution of the EMS certificates The figure shows that more than a half of the certified ports (56%) are only ISO 14001 certified. It is followed by a quarter of ports (25%) that are only PERS certified. It continues then with the ports that are double certified with PERS and ISO 14001 (9%) and with the three EMS certificates (6%). There is a minority of ports that are either only EMAS, or ISO 14001 and EMAS (2% each case). The positive, significant trend for the sector is that increasingly more port authorities are openly demonstrating their environmental credentials and transparency of action through independent, third-party review and audit.
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ENVIRONMENTAL MONITORING INDICATORS The second category of indicators are focussed on the environmental monitoring programs of European ports. These indicators provide the percentage of ports that monitor selected environmental issues. The percentages of positive responses are given in Table 4, listed in descending order based on the results obtained in 2017. The results obtained in 2013 and 2016 are also provided in the table below: Table 4: Percentage of positive responses to environmental monitoring indicators
Indicators Waste Energy consumption Water quality Water consumption Air quality Sediment quality Noise Carbon Footprint Soil quality Marine ecosystems Terrestrial habitats
2013 (%)
2016 (%)
2017 (%)
67 65 56 58 52 56 52 48 42 35 38
79 73 70 62 65 63 57 47 44 36 30
88 80 75 71 69 65 64 49 48 44 37
% change 2013-2017 +21 +15 +19 +13 +17 +9 +12 +1 +6 +9 -1
In 2017, waste has been pointed out as the most monitored issue, as in 2013 and 2016. There has been an increase of 21% of ports monitoring this aspect in the last 4 years. It is followed by energy consumption (that increased +15% since 2013), water quality (rising +19%) and air quality (+17% since 2013). Marine ecosystems and terrestrial habitats are the issues that have a lowest percentage of ports monitoring them. As it can be seen, all the indicators have more positive responses in 2017 than in 2016.
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TOP 10 ENVIRONMENTAL PRIORITIES The third section provides the update of the Top 10 environmental priorities of the European port authorities. It is an interesting exercise that has to be brought up to date regularly because it shows the current issues that are at stake for the port sector and their evolution. This data is important as it identifies the high priority environmental issues on which ports are working and sets the framework for guidance and initiatives to be taken by ESPO. The 2017 exercise comes to complement the results of the previous ESPO/EcoPorts surveys that initiated back in 1996. The issues that appear consistently year over year are mapped with the same colour in order to easily identify them. Table 5: Top 10 environmental priorities of the port sector over years.
1996
2004
2009
2013
2016
2017
Noise
Air quality
Air quality
Air Quality
Garbage/ Port Energy waste Consumption
1
Port Garbage Development Port waste (water)
2
Water quality
Dredging: operations
Air quality
3
Dredging disposal
Dredging disposal
Garbage Port waste
4
Dredging: operations
Dust
Dredging: operations
Noise
Relationship with local Water quality community
5
Dust
Noise
Dredging: disposal
Ship waste
Garbage/ Port Dredging: waste operations
6
Port Development Air quality (land)
Relationship Relationship with local with local Ship waste community community
7
Contaminate d land
Energy consumption
8
Habitat loss / Bunkering degradation
9
Traffic volume
10
Industrial effluent
/
Hazardous cargo
/ Energy Consumption
Dredging: operations
Noise
Energy Consumption Noise
Garbage/ Port waste
Port development (land related)
Port development (land related)
Dust
Dust
Water quality
Relationship with local community
Port Development (land)
Port Development (water)
Port development (land)
Dust
Ship waste
Ship discharge (bilge)
Port Development (land)
Water quality
Dredging: operations
Climate change
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Most of the priorities of the 2016 top-10 remain in the top-10 of 2017. There are some changes in the order of priorities and a new entrance for the first time to the top-10, Climate Change (which as a category under EcoPorts covers energy efficiency, GHG emissions reduction and adaptation). There are now three emissions related issues reported in the top-10 priorities, i.e. Air Quality, Energy Consumption and Climate Change. This shift reflects efforts made by ports to address the challenges of climate change, the energy transition policies already being implemented to fulfil the objectives of the Paris Agreement, and increased awareness about the exposure of ports to extreme weather events. In the case of Dredging operations and Water quality, importance rose in priority whilst Garbage / Port waste, Ship waste and Relationship with local community moved down the priority scale. However, it is important to point out that waste was reported to be the issue most monitored by ports in 2017 (table 4). Air quality remains the number one priority of the European ports, as in 2016 and 2013. This is fully in line with the maintenance of air quality as a top priority also of the EU policy agenda and the various ongoing regulatory measures that include the introduction of the global 0.5% sulphur cap on marine fuels in 2020, the introduction of the IMO NOx Tier III requirements for vessels built from 1-1-2021 onwards operating in the North and the Baltic sea (NECAs), the implementation of the Sulphur Directive and the new National Emission Ceilings Directive. Energy consumption also remains as the second priority issue of the European ports. Since 2009, the importance of energy consumption raised year over year as it can be seen in table 5. One of the reasons for this increase is, of course, the direct link between energy consumption, and the carbon footprint of the ports and Climate Change. Noise remains as the third concern by priority and its importance has also grown smoothly since 2004. Another interesting fact is that there are two issues that have appeared consistently in the priority list of the port sector over the last 20 years, although they are not in the top positions of the table. These issues are port development (land) and dredging operations.
SERVICES TO SHIPPING The last section provides the results on the category ‘services to shipping’. It comprises three indicators on the efforts made by the port authorities in order to facilitate a greener shipping. PORTOPIA considers that it is timely and topical to monitor the current status and evolution of some key services that ports may choose to provide such as the provision of Onshore Power Supply, the provision of Liquefied Natural Gas (LNG) bunkering facilities and the differentiation of port charges in order to reward greener vessels visiting the ports. Hence, and as a result of coordinated effort by PORTOPIA and EcoPorts, the EcoPorts SDM checklist was updated back in spring 2015 in order to allow for data collection in these key three areas. The figures below update the performance of the sector on this issue. It should be noted that in 2016 only 61 ports reported on these topics whereas in 2017, the participating ports increased to 91. Therefore, the results may reflect a slight decrease due to the wider sample of the respondent ports taken into account and not due to a real decrease in services offered by ports. In fact, in absolute figures, the ports offering for example Onshore Power Supply (OPS) have increased from 32 (2016) to 44 ports (2017). The same happens for the rest of the questions.
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Table 6: Percentage of positive responses to services to shipping indicators
Indicator 2016*(%) 2017 (%) Is On-shore Power Supply (OPS) available at one or more of the 53 48 berths? If YES, high voltage? 20 19 If YES, low voltage? 47 40 Does the port offer differentiate dues for “Greener” vessels? 62 51 Is Liquefied Natural Gas (LNG) bunkering available in the port 22 22 today? *This percentage is calculated only with 61 ports whereas the 2017 is done with 91 ports. The results regarding the provision of OPS require a careful interpretation. The overarching question “do you provide OPS?” encompasses both the provision of high and low voltage installations. In reality, in the big majority of cases, high voltage OPS is required in order to be used by commercial seagoing vessels. There are however few exceptions (e.g. ports of Stockholm and Helsinki) where low voltage OPS is also used by commercial ROPAX vessels. Despite therefore, the surprising 48% of respondent ports that provide OPS in their port (either high or low voltage), the appropriate figure to be used in order to set the 2017 baseline for the provision of OPS for commercial vessels is the one that describes the provision of high voltage OPS. Almost one out of five of the 91 respondent ports have high voltage OPS installations. The low voltage figures mainly relate to inland and domestics vessels as well as auxiliary vessels (e.g. tugs and/or other port authority vessels). Table 6 also confirms that offering differentiated port charges to reward greener vessels is an already established practice in half of the respondent ports (51%). This is a voluntary practise by port authorities that choose to go further than controlling their own environmental impact and encourage a positive change of behaviour on the vessels performance side. Environmentally differentiated port charges are encouraged and promoted through the ESPO “Green Guide; towards excellence in port environmental management and sustainability”. The outcomes regarding LNG show that one out of five respondent ports can already provide LNG bunkering regularly or upon request. It is interesting to follow the evolution of this baseline figure in the years to come also in relation to fulfilling the requirements of the directive on alternative fuels infrastructure as regards the provision by ports of LNG bunkering facilities by 2025.
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CONCLUSION This report demonstrates that, based on a survey of the EcoPorts Network, the majority of EU ports are working actively to protect the environment with the aim of achieving sustainable development of European ports and harbours. The results demonstrate that in general there has been an increase in the effective performance of the sector regarding the existence of environmental management components, and in terms of monitoring environmental issues. The evidence for these positive results is the rise in the number of ports having an Environmental Policy, the increase of the Management Index and the investments in conducting more monitoring in aspects such as waste or energy consumption. This update of the top-10 environmental issues is an important review for the port sector in Europe because it identifies the high priority issues common to the sector on which ports are working, and sets the framework for guidance and initiatives to be taken by ESPO. Air quality remains at the top of the priorities together with Energy consumption, Noise and Water quality, while a third emissions related priority, Climate Change, enters the top-10 for the first time. Finally, the benchmark performance of the port services to shipping indicators has been updated with the results of the 91 responses in 2017. Although it seems that there has not been a raise in the percentage performance of these indicators in absolute values there has been an increase for all of them. In any case there is room for further improvement and focus may be given on those issues in the upcoming years. The extent to which port authorities are actively influencing shipping to become ‘green’ is indicated by the increasing number of ports offering a range of options including fee reduction (against a range of criteria) and specific possibilities such as OPS. Indicators of the implementation of these options have only recently been introduced into the response database and it is widely acknowledged that the issue of port provisions for ‘Green Shipping’ will become increasingly significant in the near future.
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SECTION
4: LOGISTIC CHAIN AND OPERATIONAL PERFORMANCE INDICATORS The research by the PORTOPIA project builds further upon PPRISM and has developed following indicators, of which the concepts have been tested, but are lacking a structural supply of data to become permanently available. This is due to (1) raw data controlled by private parties, and not freely or ‘open’ available (2) the high and unreasonable cost to manually compile the datasets. In sum, the implementation of these indicators, while very relevant, necessitates the set – up of partnership with external data suppliers. More particularly, the following indicators were targeted, of which currently only the THC index had led to satisfactory results (in terms of implementation): Connectivity indicators: --- Ro-Ro Connectivity Indicator --- Maritime Connectivity Indicator --- Intermodal Connectivity Indicator Cost indicators (under the form of indices): --- Port Dues --- Terminal Handling Charges (THC) Congestion indicators: --- Maritime Fluidity: tested within 2 ports based on AIS data provided by MarineTraffic --- Road congestion Currently, further work is ongoing on the development of a port productivity indicator. The full results of the research and development phase of these indicators are available on www.portopia.eu (or by contacting directly the PORTOPIA contact persons, see the introduction). In this section, we introduce two indicators based on UNCTAD data and re-interpreted by PORTOPIA: The Liner Shipping Connectivity index (LSCI) Time spent in port (based on UNCTAD and Marine Traffic Data)
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LSCI EVOLUTION (EU)
Source: PORTOPIA based on UNCTAD (2017) Larger container ships and volumes in Baltic, Black sea and Adriatic.
Europe’s LSCI has relatively improved by 50% since 2004. Regions outperforming the European average are Scandinavia and the Baltic countries, the Black Sea countries, and the Adriatic countries. This evolution shows the increasing volumes and ship sizes calling these regions. While the North-West European countries have the highest LSCI in absolute terms (see http://unctad.org/en/pages/publications/Review-of-Maritime-Transport-(Series).aspx), they were still able to improve liner shipping connectivity, but at a slower pace given the maturity of their ports. During the last 2 years, connectivity in North-West Europe and the Mediterranean has gone downwards, most probably due to consolidation in the market and resulting rationalization of port calls by container lines.
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LSCI EVOLUTION (WORLD)
Source: PORTOPIA based on UNCTAD (2017) EU outperforming US and Canada, following pace of BRICs. While Europe’s evolution in terms of liner shipping connectivity improvement is similar as the BRICs and the Asia Pacific countries over the long term, it is better than the evolution of the US and Canadian ports. This might be due to the scale increases of vessels, which poses issues for a number of North-American ports, as well as the “double-dip” crisis of 2008/2011. The “Nearest Competitor” group is composed of Morocco, Turkey and the Russian Federation and are considered fierce competitors to Europe’s peripheral regions such as the Black Sea and East Med, the Iberian Peninsula and the Baltic, as evidenced elsewhere in this report. We see very significant growth for this group, and while the previous figure also showed considerable growth in Europe’s peripheral regions such as the Baltic and the Black Sea, this might raise further competitive challenges in the future, e.g. in the West Med due to the presence of development in North Africa (Tangier Med, others). In 2017, most regions show stable or even declining liner shipping connectivity. This is based on market based developments such as the scale increase of vessels, and consolidation in the container liner shipping market through mergers and acquisitions, as well as alliances, leading to rationalization of port calls and deployed capacity. In particular remote and peripheral locations might suffer from this evolution.
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TIME SPENT IN PORT (NEW INDICATOR, BASED ON UNCTAD AND MARINE TRAFFIC DATA) Since 2017, and its launch of the 49th Review of Maritime Transport (RMT), UNCTAD offers global figures, on a country level, of the indicator ‘time spent in port’. While the indicator does not take into consideration e.g. average ship size or call size per country, given the number of data points, it provides a basic indication of port efficiency across the logistics activities in the ports. Due to its collaboration with and support from UNCTAD, PORTOPIA calculated EU aggregated figures, as well as for the EU subregions. Likewise, a comparison of the EU with other world regions is offered, both on a general level, as well as per shipping market. PORTOPIA hopes to include yearly figures in the future, showing longer terms evolutions, and in collaboration with UNCTAD and Marine Traffic, improve the value of the indicator for ports and related decision-makers.
EUROPE GENERAL TOTAL - Average Dwell Time in days (annual median) SCBAL
0,96
ATL
1,06
EUROPE
1,06
NWE
1,11
MED
1,23
ADR
1,26
BLACK SEA
2,37 0,00
0,50
1,00
1,50
2,00
2,50
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017) Black Sea lagging in terms of time spent in ports Within Europe, across all shipping markets, time spent in port amounts to ca. 1 day. While Northern and Atlantic EU regions show a slightly better performance than Southern EU regions, the Black Sea region could be considered as an area to improve the performance of this indicator.
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EUROPE Bulk Carriers - Average Dwell Time in days (annual median) SCBAL
2,40
EUROPE
2,76
NWE
2,96
ATL
3,04
MED
3,42 3,84
ADR BLACK SEA
5,80 0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
EUROPE Container Ships - Average Dwell Time in days (annual median) SCBAL
0,61
MED
0,63
ADR
0,67
ATL
0,67
EUROPE
0,68
BLACK SEA
0,73
NWE
0,75 0,00
0,10
0,20
0,30
0,40
0,50
0,60
0,70
0,80
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
Across Europe, container ships spend in general less than 1 day for a port call. Here, North West Europe appears to have a lower performance, but as the data do not correct for ship and call size (significantly larger e.g. in the Hamburg-Le Havre range), we can conclude that overall, EU ports offer quite standardized performance offers to container ships. This also suggests that port competiveness for container handling will also depend on fluid and sustainable hinterland access.
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EUROPE Dry Cargo/Passenger - Average Dwell Time in days (annual median) 0,65
NWE
0,74
ADR ATL
0,77
EUROPE
0,77 0,83
SCBAL MED
0,98
BLACK SEA
2,05 0,00
0,50
1,00
1,50
2,00
2,50
$
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
EUROPE Gas Carriers - Average Dwell Time in days (annual median) BLACK SEA
N/A
SCBAL
0,70
NWE
1,06
EUROPE
1,07
ATL
1,11
MED
1,21 1,80
ADR 0,00
0,50
1,00
1,50
2,00
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
EUROPE Tankers - Average Dwell Time in days (annual median) ATL
0,86
SCBAL
0,88
NWE
0,98
EUROPE
0,99 1,07
MED ADR
1,54 1,76
BLACK SEA 0,00
0,50
1,00
1,50
2,00
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
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GLOBAL General Total - Average Dwell Time in days (annual median) 1,06
EUROPE ASIA-PACIFIC
1,35
NORTH-AMERICA
1,62 1,88
BRIC
1,99
NEAREST COMP. 0,00
0,50
1,00
1,50
2,00
2,50
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017) As a world region, across shipping markets, the EU ports on average provide the lowest time spent in ports. Obviously, the results need to be interpreted with care as Japan, the best performer, is aggregated within the Asia Pacific region, where a large spread exists between countries.
GLOBAL Bulk Carriers - Average Dwell Time in days (annual median) NORTH-AMERICA
2,15 2,29
ASIA-PACIFIC BRIC
2,66
EUROPE
2,76
NEAREST COMP.
3,89 0,00
1,00
2,00
3,00
4,00
5,00
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
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European Port Industry Sustainability Report 2017
GLOBAL Container Ships - Average Dwell Time in days (annual median) 0,65
ASIA-PACIFIC
0,68
EUROPE BRIC
0,83 1,07
NORTH-AMERICA NEAREST COMP.
1,12 0,00
0,20
0,40
0,60
0,80
1,00
1,20
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017) For container ships, when time spent in port is concerned, EU ports are at the level of the ports in the Asia-Pacific region, and performing significantly better than BRIC, North America and the Nearest Competitors.
GLOBAL Dry Cargo/Passenger - Average Dwell Time in days (annual median) 0,77
EUROPE
1,16
ASIA-PACIFIC
1,72
NORTH-AMERICA BRIC
1,85 2,12
NEAREST COMP. 0,00
0,50
1,00
1,50
2,00
2,50
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
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European Port Industry Sustainability Report 2017
GLOBAL Gas Carriers - Average Dwell Time in days (annual median) 0,81
ASIA-PACIFIC EUROPE
1,07 1,26
BRIC
1,37
NEAREST COMP. NORTH-AMERICA
2,07 0,00
0,50
1,00
1,50
2,00
2,50
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
GLOBAL Tankers - Average Dwell Time in days (annual median) 0,99
EUROPE
1,32
ASIA-PACIFIC NORTH-AMERICA
1,44 1,47
NEAREST COMP. BRIC
2,07 0,00
0,50
1,00
1,50
2,00
2,50
Source : PORTOPIA based on UNCTAD and Marine Traffic data (2017)
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SECTION 5: GOVERNANCE INDICATORS Information on port governance in Europe is historically gathered through a 5-yearly survey, conducted by the European Seaports Organisation, the so-called “Fact Finding Study”. The ESPO Fact Finding surveys have developed into a real tool to monitor the evolution of the port authorities in Europe in terms of governance models and of port concept. The aim of these reports is to monitor port governance and organisation in Europe and its evolution over time. The 2016 edition of the ‘Fact-Finding Report’ is the sixth in its kind. Although building on tradition, the 2016 edition introduces new topics such as Energy developments and Industry in ports. The reason for adding these new features is the importance for a ‘Fact-Finding Report’ to capture all the key dimensions of a port beyond its key role in transport. These include nowadays the role of ports as home or key partners of industrial clusters, the energy transition and the sustainability of port activity. The 2016 fact finding study is based on a web-based survey that was sent directly to individual port authorities. 86 port authorities from 19 EU Member States, Norway and Iceland 1completed the questionnaire. Together, they represent more than 200 ports and more than 57% of the overall volume of cargo handled in the European Union. A number of aspects and trends are highlighted below which were identified when analysing the results of the two editions of the fact finding surveys 2010-2015 and that were pivotal in the selection of the governance indicators to be included in WP5: • • • • • •
•
Increasing privatisation and commercialisation of port authorities Increased cooperation and merging of port authorities, be it top-down or bottom-up Decreasing role of port authorities in the organisation, provision and operation of services to the ships More active role of port authorities in hinterland connections and in infrastructure investments outside the port Energy transition and role of port authorities in energy developments in and outside the ports and role of port authorities in fighting climate change. Dependency of port authorities from industrial partners in terms of revenues and uncertain future of fossil based sectors, chemicals or other traditional sectors based in ports. Port authorities increased efforts on Corporate Social Responsibility initiatives and reporting, including environmental impacts of port activities, education, job quality, etc.
1 Norway and Iceland are included as EEA members
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SEAPORTS REMAIN UNDER PUBLIC OWNERSHIP BUT ARE MOVING TOWARDS MORE INDEPENDENT BUSINESS-LIKE MANAGAMENT
Figure 4: Ownership of EU port authorities Even if the large majority of European seaports is under public ownership, many recent reforms have led to a growing trend of independent port management. This can be easily showed through a comparison of the results of the ESPO Fact Finding 2010 and 2016. In 2016, most port authorities in Europe remain publicly owned. Full ownership by the state or by the municipality remains predominant. Only very few port authorities combine ownership of different government levels (eg. state-municipality, province-municipality). Mixed public-private ownership is still very rare and exists only in a few countries. In these cases, the public sector owns the majority of shares and private shareholders’ participation is rather limited. Port authorities listed in the stock exchange remain the exception in 2016. Full private ownership, where the port authority is fully owned by one or more private parties, is characteristic of some ports in the UK. There are no other fully private ports from other countries in the sample of respondent ports. The ownership picture did not change substantially since 2010, despite the financial and economic crisis and the pressure on Member States’ budgets. EU seaports take a different path than EU airports, which undergo a clear trend towards more private ownership.
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Share of commercialized entities through the EU Port authorities Compared to 2010, more port authorities are structured as independent commercial entities (Ltd“Limited Companies”, SA-“Sociétée Anonyme”, GmbH, AB-“Aktiebolag”, Spółka Akcyjna, etc.) and operate in a commercially-oriented manner. In the Fact Finding Report 2016, they account for 51% of the respondents. Next, 44% of port authorities are still independent public bodies with their own legal personality and different degrees of functional and financial dependency from the public administration. These two main categories, while operating under different legal forms, may share similar principles like self-financing, and commercial and entrepreneurial behaviour to increase market share and to attract private investment. They may also share same levels of influence from public authorities through participation in the governing board of the port.
Figure 5: Share of commercialized entities through the EU Port authorities
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MAIN PORTS SERVICES ARE IN PRIVATE HANDS In European ports, as shown in the ESPO Fact Finding 2016, the operation of the main services provided to ships is mostly in private hands with the exception of pilotage, which is still under considerable public influence. Sometimes, the port authority may have an influence on the quality of certain ship services through the issuing of licences or authorisations, but the port authority does not always have this competence. The harbour master, whether integrated or not in the port authority organisation, takes on the coordinator role for the technical nautical services.
Figure 6: Provision of port services to ships
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Figure 7: Provision of services to cargo Cargo handling services are in the hands of private operators who are generally granted the use of port land through lease agreements or public domain concessions. Integrated ports where port authorities provide a full range of services and other mixed cases are the exception. As shown in the ESPO Fact Finding 2016, transport services are also provided by private parties in most cases.
A GROWING COOPERATION TREND Port cooperation aims at increasing the competitiveness of individual ports in joint effort and offers the potential to manage public and private infrastructure and superstructure investments in parallel to mitigating the investment risk. Different needs could lead port authorities to cooperate: a marketing objective, an economic optimization of operations, the exchange of know-how, land use planning, etc. The intensity of the links established between two or more port authorities can be variable, from simple partnership to more formal cooperation schemes, leading to shared commercial strategies, joint promotion or pooling of certain resources (e.g. North Adriatic Ports Association, Haropa, etc.). The strongest cooperation link is represented by a real merger of two or several port authorities and the consequent formation of a joint venture company (e.g. MalmöCopenhagen, Kotka-Hamina, Umeå-Vaasa etc.). As the Fact Finding 2016 shows, cooperation and partnerships amongst European seaports represent a growing trend. End 2017 one expects the completion of another important and cross border merger between the Port of Ghent and Zeeland Seaports.
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Figure 8: Partnerships with other seaports, inland ports and dry ports
Figure 9: Number of ports managed by a port authority
More cooperation also leads to another phenomenon: port authorities increasingly manage port land and infrastructure for several ports in the same country. Since the 2010 edition of the Fact Finding, merging of neighbouring port authorities happened either bottom-up, as a result of cooperation between port authorities, or driven by government’s policy.
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A STRONGER ‘LICENSE TO OPERATE’ OF PORT AUTHORITIES Meanwhile a new functional role has emerged, which we can best refer to as that of the ‘community’ or ‘cluster’ manager, a functional concept which was mainly developed by De Langen (2004; 2007). This new function is intrinsically linked to the changing nature of port communities and stakeholders and has both an economic and societal dimension that corresponds with the stakeholder pressures. The community manager function is essentially a coordinating function, meant to solve collective action problems in and outside the port area, such as hinterland bottlenecks, training and education, ICT, marketing and promotion as well as innovation and internationalization. It also aims to shape accommodation between conflicting interests in order to defend the ‘license to operate’ and ‘license to grow’ of the port. The economic and societal dimension can meet, for instance in case of port authorities inciting private operators to engage in sustainable behavior, thus linking up with the landlord and regulatory functions.
Developing the port hand in hand with the local community and key stakeholders Port authorities are in most cases responsible for port development. Producing a port masterplan is nowadays common practice. According to the ESPO Survey 2016, 64% of port authorities surveyed have produced a masterplan, of which 78% date from 2010 or were produced after that. A port masterplan sets out the port’s strategic planning for the medium to long term. It provides a clear view on how the port will be developed during this time frame and shows the potential impact on the surrounding community. The time frame covered by port masterplans is generally long, ranging from 15 to 30 years. The masterplan must therefore be flexible and can be reviewed and adjusted according to changing circumstances. The port masterplan is a public document available on the ports’ websites. A masterplan also provides credibility to the port authority when searching for public and private investors. Giving key stakeholders the opportunity to raise their concerns and expectations is a crucial part of the process. For this reason, in the process of producing a masterplan, port authorities involve public authorities at different levels, citizens, NGO’s and key stakeholders like port employees, tenants and users.
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Figure 10: Categories of stakeholders involved in the development of the Masterplan
Building a beneficial relationship with employees and the local community Many ports already advertise their corporate social responsibility (CSR) values on their websites and in their public reports. In this sense, the survey shows that already more than half of the respondent port authorities (up to 54% of the ESPO Fact Finding 2016 respondents) have a formalised CSR policy. Of those, two thirds already report on their corporate social responsibility performance through measurable objectives. The commitments and achievements are often displayed in the ports’ sustainability reports that are published (annually) and are available online. Port employees and local communities are the main beneficiaries of these proactive policies.
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Figure 11: Stakeholders involved in corporate social responsibility initiatives
Urban ports and societal integration of port activities Most of the ports surveyed are located in or very close to an urban area (91% of the ESPO Fact Finding 2016 respondents). Proximity to urban centres may trigger tensions, so port managers need to proactively manage the city-port relation to secure their “licence to operate and grow”. In this sense, a majority of port authorities design and implement initiatives to establish good cohabitation and to make the general public experience and understand the positive effects produced by the port activity (i.e. employment, added value, wealth creation, taxes paid to the region, connectivity, etc.). Finding the optimal balance between port operations, and city developments and well-being is one of the main challenges of port managers today.
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Figure 12: Initiatives led by the port authority aimed at improving societal integration of port activities To promote societal integration of ports, ESPO created in 2009 an annual award that selects the best initiative among European ports to enhance the city-port relations through innovative projects (http://www.espo.be/events#espo-award-2). In 2010, ESPO also developed a Code of Practice on Societal Integration of Ports2 with recommendations on how to proactively respond to this challenge.
PORT AUTHORITIES ARE FACILITORS AND SUPPORTERS OF THE ENERGY TRANSITION Even if port authorities are not directly a large source of CO2 emissions, they can act as facilitators and promoters of energy transition for the whole port cluster and stakeholders. As demand for cleaner energy increases, fossil fuels are gradually being complemented or replaced by renewable/alternative energy sources. To support the energy transition, many port authorities have taken up a key role by hosting renewable energy production and promoting its uptake. As the Fact Finding 2016, 41% of respondent port authorities secure land to generate or support clean energy, thus fulfilling their traditional role as landlords. 38% of respondents are initiating or facilitating that investors bring renewable energy production to the port or the region. A smaller percentage of ports go further and become (co-)investors (16%) or operators (13%) of the facilities.
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While employment data in this sector is not readily available for most of the ports surveyed (64%), jobs linked to renewable energy in ports are forecasted to grow considerably in the next five years.
Figure 13: Role of port authority in the production of renewable energy
Ports are main entry points of energy commodities Energy commodities represent a substantial part of traffic volumes of many European ports. Ports play a key role in the import, export, storage and distribution of fossil and other energy sources (crude oil, gas, LNG, coal, biomass, etc.). Developments impacting these commodities such as EU and government policies, geopolitical problems, price fluctuations, changes in energy suppliers and demand, etc. are therefore very relevant for the ports’ business and strategy. Most ports are at the centre of large population concentrations, hence being the main entry point for energy commodities. Figure 14: Approximate percentage of energy-related traffic in the port by volume
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Ports are locations for energy production Ports are traditional locations for energy production because of the easy access to raw energy sources. The ESPO survey 2016 shows that 50% of respondent ports have energy production plants located in the port area. In addition, energy production can also be located right in the vicinity of the port, which is not captured by the survey. Together with traditional fossil-fuelled energy plants, ports are increasingly generating sustainable energy with wind and solar, biomass and waste-based energy production expanding in ports.
Electricity provision Electricity is a rising cost due to carbon pricing schemes which are currently implemented such as the EU Emissions Trading Scheme (ETS), automation and more intensive port operations. 39% of the respondent port authorities are still electricity providers for the port area, directly or through a subsidiary company. The electricity is mainly sold on a cost-recovery basis although some ports do it on profit basis. 31% of respondent ports do not play any role in the provision of electricity in the port. In some cases, port authorities are owners of the infrastructure grid.
Energy management is a key concern of port authorities The ESPO Environmental Review 20163 revealed that energy consumption is the second environmental priority of European ports. This demonstrates that port authorities are increasingly aware that reducing energy use saves money and contributes to CO2 reduction. The survey shows that more than half of the respondent ports have already established energy targets, among which two thirds of respondents target the port authority's owned and controlled facilities. Fewer port authorities extend these targets to all the port operations and facilities. European ports vary in size and activities. Influencing the energy performance of the whole port can be very challenging. Therefore, port authorities set up targets and take measures according to their resources available. The survey captures some key measures put in place by port authorities and their scope.
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Figure 15: Establishment of targets and key measures related to energy consumption and efficiency by the port authority
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SECTION 6: USER PERCEPTIONS OF PORT QUALITY User or Customer Satisfaction surveys have received increased interest by port authorities and their stakeholders. However, a very small sample of ports actually measures the user perceptions on port quality (infrastructure/services) on an annual basis, based on a variety of methodologies, and reports on it. E.g., based on the integrated reporting of the Port of Rotterdam, an overall study of user perceptions, (including the reporting of an overall user perception (or satisfaction) indicator) is executed once every 2/3 years by this large port (which is one of the few actually reporting the evolution of user perceptions). Currently, the only annual data available on perception on quality are situated on the country level, and are provided by the Global Competitiveness Report (GCR), released annually by the World Economic Forum (WEF). Within a survey, experts are asked to rate the criterion ‘Quality of Port Infrastructure’ on a scale from 1 to 7. Also the EU Commission is using this currently as an indicator on the «EU Transport Scoreboard»: http://ec.europa.eu/transport/factsfundings/scoreboard/index_en.htm. Another source is the Logistics Performance Index (LPI) of the World Bank, which also contains an infrastructure quality component, alongside other elements of logistics performance such as customs processes. We also provide a global and European perspective here. In this version of the report, we discuss the results on both indicators (GCR and LPI) on the European and the Global level. Furthermore, we believe the ports deserve better than what is actually provided! Therefore, we provide an extensive insight into a highly practical data intelligence environment recently developed by the PORTOPIA consortium, which could lower considerably both the human and financial burden for port managing bodies to perform user perception surveys, and to move beyond the generic country approach, providing real value for individual port authorities (both large and small). Over the last 18 months, interested port managing bodies, and by extension, their user associations, have been invited to contact the consortium for pilot testing of this data intelligence environment for port user perception measurement. The actual tool has been demonstrated at the ESPO conferences in Dublin (June 2016) and Barcelona (June 2017). An online video is available on the following link: https://www.youtube.com/watch?v=tByVOJk46DA
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QUALITY OF PORT INFRASTRUCTURE EVOLUTION (EU)
Source: PORTOPIA based on WEF (2017) Overall decline of North-West Europe in QOPI indicator. While progress has been made over the longer term, we observe an overall decline of North-West Europe and the Mediterranean, while the Adriatic, Scandinavia/Baltic and Black Sea regions have increased their competitiveness (cfr. also the LSCI evolutions elsewhere in this report). Overall, with exception of the last year, the European average is steadily rising and significantly above the Global Average (which is decreasing since 2010), while however showing marked differences internally in the European subcontinent.
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QUALITY OF PORT INFRASTRUCTURE EVOLUTION (WORLD)
Source: PORTOPIA based on WEF (2017) Stability of Europe’s perceived competitiveness. Here, the figure confirms the steady increase and stable position of Europe’s perceived competitiveness on the port infrastructure dimension over the long run, while the US and Canada show a decline, which has stabilized since 2010. The evolutions of the world regions are quite similar to the LSCI observations, i.e. Europe, Asia Pacific and BRICs following a path of steady growth, with the largest increase at the level of Europe’s “nearest competitors” (Morocco, Turkey and Russian Federation). These regions and country groups are nearing in on Europe’s score on the perception of quality of port infrastructure.
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EVOLUTION OF LOGISTICS PERFORMANCE INDICATOR (EU)
Source: PORTOPIA based on World Bank (2017) Steady grow th of EU logistics performance but not consistent among regions The LPI, calculated 2-yearly by the World Bank since 2007, shows an overall increase of EU logistics competitiveness (on infrastructure and processes), however with marked differences on progress between regions. Improvements over the longer term are noted for North West Europe, the Mediterranean, and Scandinavia and the Baltic countries. For other regions, such as the Black Sea, Adriatic and the Atlantic, despite some improvements, these follow a less consistent path over the last 10 years.
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EVOLUTION OF LOGISTICS PERFORMANCE INDICATOR (WORLD)
Source: PORTOPIA based on World Bank (2017) Europe remains on the path to improvement; nearest competition declines The EU Logistics Performance improves in line with the main global regions. The Nearest Competitors (Turkey, Morocco, Russia) experience a decline during the last period of analysis.
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ABOUT THE ICT TOOL “USERS’ PERCEPTIONS” The ICT Tool “Users’ Perceptions” is composed of two elements, each one marking one distinct phase. The first phase is the interface used by the ports, it starts with the creation of a campaign with criteria for a group of markets (Container, Ro/Ro, Dry Bulk, Liquid Bulk, Break Bulk and Cruise) and ends with the invitations to the ports’ users to respond to each port’s campaign. The second phase is the interface used by the port users, it starts with the receipt of the port’s invitation and the actual evaluation in terms of importance and satisfaction of the criteria that have been sent to them by the ports. A pilot exercise aimed to launch a real-time exercise, with participants being European ports/ Port Authorities, through the PORTOPIA Service Cloud, that has been designed to Measure the Port Users’ Perceptions.
THE ULTIMATE OBJECTIVE The production of a report on the “State of European Ports” is the ultimate objective of the pilot exercise. This report contains the (aggregated) results drawn by the replies recorded into the system, namely the evaluation of all participant ports by their users. It contains strictly anonymous elements (therefore in an aggregated form) without indicating neither in a direct or an indirect way any participant port, combined in a way that will communicate the state of the European port sector in terms of performance, as perceived through the prism of the port users. The report is accompanied with a GAP Analysis with valuable and specific guidance for the participant ports.
PILOT IMPLEMENTATION OF THE ICT TOOL “USERS’ PERCEPTIONS” Overview of outcomes The outcomes of the pilot implementation of the Users’ Perceptions Measurement ICT Tool as a part of the PORTOPIA Service Cloud are presented in this section, in an aggregated way. The system provides the possibility to access an automated aggregated calculation of the overall picture, ensuring in that way the complete anonymity of the participants. The overall evaluation is therefore based on the detailed and per market view of two elements rated per criterion: The satisfaction gained from each type of service and the importance that this entails for the users. The following sections present the actual ICT tool pilot implementation’s production of results, per market and criterion assessed and consist of the “State of the European Ports” Report.
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The information in which each port has individual access with their log-in details, is, of course, confidential and solely accessible by its assigned person that possesses the issued credentials. Each port, therefore, after the launch of each campaign has access to information, compiled and presented identically with the one that is stated below, with the only difference that our view refers to the group of the participants, while the port’s view refers to its specific campaigns. The report, along with a GAP Analysis will be provided, to all participants. We enclose herewith the “State of the European Ports’” report and the GAP Analysis for several selected markets.
“State of the European Ports” Report The report collects and presents the per market information for all criteria that have been selected by each port, that compiled their campaigns sent to their users. Each criterion has been attributed a twofold evaluation from the selected by the ports’ groups of port users: in terms of satisfaction, and in terms of the given importance.
Container Market: Satisfaction and Importance Evaluation The overall evaluation in terms of users’ satisfaction for the Container Market is at a satisfactory level. The satisfaction levels for the Container Market on a scale from 1 to 7 where 1 indicates the minimum satisfaction and 7 indicates the maximum level of satisfaction, reveal an average of 4 for the whole group of criteria. The lowest satisfaction level (3.5) has been attributed to the (see Figure 16 and Figure 17).: •
Storage Capacity of Reefer Containers
•
Container Storage Cost
•
Efficiency of Container Clearance Procedure
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Hinterland Intermodal Connectivity
In parallel, the importance attributed to the criteria, on a scale from 1 to 7 where 1 indicates minimum levels of importance for the user and 7 the maximum level of importance, the average given importance reaches level 6, and is smoothly and somewhat evenly distributed across criteria.
Figure 16: Overall evaluation of Container Market
Importance levels therefore are marked as high for the group of criteria that have been asked to be evaluated by port users. In terms of port management, this entails that for the container services, almost everything is significant for the users, from what compiles the Ship-to-Port interface, to what refers to Port-to-hinterland interface. This justifies the fact that the Container Market is a highly demanding one in terms of services provided and requires a lot of attention and detailed organisation, since the chain of services is highly cross-depending from the time that a vessel calls at a port, to the time that the cargo exits the port’s gate.
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Overall, the state of services offered from the participant ports on that specific market segment, are on a satisfactory level from the perspective of the users.
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Figure 17: Container Market-Overall Evaluation from Users
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Ro/Ro Market: Satisfaction and Importance Evaluation The overall evaluation in terms of users’ satisfaction for the Ro/Ro Market is that this market segment appears to perform slightly better than the Container Market. The satisfaction levels for the Ro/Ro market at a scale from 1 to 7 where 1 indicates the minimum satisfaction and 7 indicates the maximum level of satisfaction move around an average of 4,5 for the whole group of criteria. The lowest satisfaction level (4) has been attributed to several factors (see Figure 18 and Figure 19). In parallel, the importance attributed to the criteria, on a scale from 1 to 7 where 1 indicates minimum levels of importance for the user and 7 the maximum level of importance, the average given importance reaches level 6, and is also smoothly and somewhat evenly distributed across criteria (See Figure 4). Ultimately, criteria referring to inland waterway services have not been evaluated by the users, since they probably do not apply in the participant ports’ cases.
Figure 18: Overall evaluation of Ro/Ro Market Importance levels therefore are again marked as high for the group of criteria that have been asked to be evaluated from port users. In terms of port management, this entails that for the Ro/Ro related services, almost everything is significant for the users, from what compiles the Ship-toPort interface, to what refers to Port-to-hinterland interface. Overall, the state of services offered from the participant ports on that specific market segment, are on a satisfactory level from the perspective of the users.
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Figure 19: Ro/Ro Market – Overall Evaluation from Users
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Dry Bulk Market: Satisfaction and Importance Evaluation The overall evaluation in terms of users’ satisfaction for the Dry Bulk Market moves as well at an average level, revealing the same patterns indicated for the latter two markets, namely Container and Ro/Ro. The satisfaction levels for the Dry Bulk market on a scale from 1 to 7 where 1 indicates the minimum satisfaction and 7 indicates the maximum level of satisfaction moves around an average of 4,5 for the whole group of criteria. The Dry Bulk Market reveals a more informative view in comparison with the previous ones, in terms of unfavourable satisfaction rating: 1. Low levels of satisfaction are expressed in terms of costs. A score of 3 has been attributed to dredging costs. 2. Initiations towards innovativeness is an also low rated element by the users, combined with a high importance level. 3. Ports also that operate at the Dry Bulk Market do not seem to pay proper attention to the diffusion of the dry bulk cargo through rail connections, as these have been performing low in terms of efficiency and connectivity (3,5). Regarding the importance attributed to the criteria, on a scale from 1 to 7 where 1 indicates minimum levels of importance for the user and 7 the maximum level of importance, an average given importance reaches level 6, and is also smoothly and somewhat evenly distributed across criteria (See Figure 21). Ultimately, criteria referring to inland waterway services have not been evaluated by the users, since they do not apply in the participant ports’ cases.
Figure 20: Overall evaluation of Dry Bulk Market
Importance levels therefore are again marked as high for the group of criteria that have been asked to be evaluated from port users. In terms of port management, this entails that for the Dry Bulk related services, almost everything is significant for the users, from what compiles the Ship-toPort interface, to what includes Port-to-hinterland interface elements. Overall, the state of services offered from the participant ports on that specific market segment, are on a satisfactory level from the perspective of the users. Room for improvement is clearly offered for the elements with low satisfaction evaluation as these stated above.
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Figure 21: Dry Bulk Market – Overall Evaluation from Users
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Cruise Market: Satisfaction and Importance Evaluation The cruise Market reveals a high evaluation picture, being one of the best performing market segments from the perspective of the respective services’ users. The satisfaction levels for the Cruise market on a scale from 1 to 7 where 1 indicates the minimum satisfaction and 7 indicates the maximum level of satisfaction is given an overall level of 5,5 for the whole group of criteria. Exceptionally high levels of evaluation have been given to all criteria. A somewhat average evaluation (4) has been given to “Parking Areas” availability. Regarding the importance attributed to the criteria, on a scale from 1 to 7 where 1 indicates minimum levels of importance for the user and 7 the maximum level of importance, an average given importance reaches level 6, and is also smoothly and somewhat evenly distributed across criteria (See Figure 23).
Figure 22: Overall evaluation of Cruise Market Importance levels therefore are again marked as high for the group of criteria that have been asked to be evaluated from port users. In terms of port management, this entails that for the Cruise related services, almost everything is significant for the users, from what compiles the Ship-toPort interface, to Port-to-hinterland interface. Overall, the state of services offered from the participant ports on that specific market segment, are on an exceptional level from the perspective of the users.
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Figure 23: Cruise Market – Overall Evaluation from Users
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GAP Analysis A GAP Analysis is conducted on the aggregated data. This GAP Analysis reveals the difference between how important the criteria answered have been for the respondents and how satisfied the respondents are with those criteria. It is a tool for interpretation of the port users’ ratings. The GAP Analysis finds the gaps between satisfaction and importance and can identify the priorities for improvement. The results indicate that if the satisfaction bar is shorter than the importance bar, then expectations are not fully met and there is room for improvement. The sections below present the GAP Analysis conducted for the overall results and also per port market. If the score of a service is positive (above zero) then the port users rated the service very important, but they are not satisfied with the service. In this instance, action is required. If the mean score of a service is negative (below zero) then respondents rated this service relatively unimportant, but are very satisfied with the service. In this instance no action is required. The closer the gap is to zero the better balance there is between importance and satisfaction.
Overall per Market Large positive gaps are identified (Figure 24) at the Container, Break Bulk and Ro/Ro Market. This entails that the port users’ perspective is that they consider the services provided by ports for these specific markets very important, but their overall satisfaction is low. A high priority for improvement is therefore indicated for these markets in an overall evaluation. Cruise Market and the Liquid Bulk Market identified with a small positive gap revealing a relatively important rating at the average of the criteria included compared to low satisfaction. Space for improvements can also be seen for this market segment.
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GAP Analysis Overall Cruise Market Break Bulk Market Liquid Bulk Market Dry Bulk Market Ro/Ro Market Container Market 0
0,5
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Figure 24: GAP Analysis/Overall
Container Market Large positive gaps are identified (Figure 25) for the majority of criteria consisting the Container Market evaluation by the port users. The ports’ users’ perspective is that they find these criteria significant, but their satisfaction is low. Criteria that are identified with these large gaps (from 1 to 2,5) must be considered as priorities in improvement initiatives by port managers. A small positive gap is shown for several criteria, whilst a high negative is gap is only attributed for the evaluation of the “Deep Sea Container Services”, where there is no need for corrective actions.
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GAP Analysis Container Market Quality-efficiency of road transport services Connectivity to road network Customs operating hours Hinterland intermodal connectivity Efficiency of container clearness procedure Services for containers (added value services, … Container storage cost Number of operational stacking equipment Storage capacity for reefer containers Storage capacity for containers Port safety Port security Accuracy of information Online information On-time information Transparency of port charges Response to regulation changes Response to innovativeness Response to users requests Coordination of port community/stakeholders Container handling cost Number of operational gantry cranes Efficiency of (un)loading operations Vessel-related port costs Efficiency (Quality-Cost) of Towage Efficiency (Quality-Cost) of Pilotage Efficiency (Quality-Cost) of Waste reception facilities Efficiency (Quality-Cost) of Mooring Efficiency (Quality-Cost) of Dredging Efficiency (Quality-Cost) of Ice-breaking Efficiency (Quality-Cost) of Bunkering On-time departure On-time arrival Port operating hours Operational depth Total length of quays Number of berths Feeder container services Deep-sea container services -2 -1,5 -1 -0,5 0
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Figure 25: GAP Analysis/Container Market
Ro/Ro Market The Ro/Ro Market evaluation reveals smaller gaps than the previously presented market of Containers, although a very high positive gap (at a 2,5 level) is reveled for the “Vessel Related port costs”. Improvement action is considered essential for that case, following for all other services represented by the criteria that reveal an additional high positive gap at the scale of 2 (Figure 26).
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Several criteria have a good balance between satisfaction and importance, giving a 0,5 gap. Action is not recommended in these cases as a priority, along with the “Dredging Efficiency” which reveals also a large negative gap.
GAP Analysis Ro/Ro Market Quality-efficiency of rail services Connectivity to rail network (number and … Connectivity to road network Customs operating hours Hinterland intermodal connectivity Efficiency of trailer-truck clearness procedure Services for trailers-trucks Number of operational tractors Trailer-truck storage cost Storage capacity for reefer trailers Storage capacity for trailers-trucks Port safety Port security Accuracy of information Online information On-time information Transparency of port charges Response to regulation changes Response to innovativeness Response to users requests Coordination of port community/stakeholders Trailer (truck) handling cost Efficiency of (un)loading operations Vessel-related port costs Efficiency (Quality-Cost) of Towage Efficiency (Quality-Cost) of Pilotage Efficiency (Quality-Cost) of Waste reception facilities Efficiency (Quality-Cost) of Mooring Efficiency (Quality-Cost) of Dredging Efficiency (Quality-Cost) of Ice-breaking Efficiency (Quality-Cost) of Bunkering On-time departure On-time arrival Port operating hours Operational depth Total length of quays Number of berths Feeder Ro-Ro services Deep-sea Ro-Ro services -2,5 -2 -1,5 -1 -0,5 0
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Figure 26: Ro/Ro Market
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Dry Bulk Market The dry Bulk Market does not reveal a satisfying performance given the results of the GAP Analysis. High positive gaps are identified for most of the criteria that have been evaluated by the port users, revealing a need for further improvements (Figure 27) Action is considered essential for all criteria that reveal high gaps between satisfaction and importance, such as the rail – services related, the “Efficiency of Dredging” and the “Operational Depth”.
GAP Analysis Dry Bulk Market Quality-efficiency of rail services Connectivity to rail network (number and … Connectivity to road network Customs operating hours Hinterland intermodal connectivity Efficiency of dry bulk cargo clearness procedure Added value services to dry bulk cargoes Services for trucks (weighting etc) Number of operational cranes Dry bulk cargoes storage cost Storage capacity for dry bulk cargoes Port safety Port security Accuracy of information Online information Transparency of port charges Response to regulation changes Response to innovativeness Response to users requests Coordination of port community/stakeholders On-time information Dry bulk cargoes handling cost Efficiency of (un)loading operations Vessel-related port costs Efficiency (Quality-Cost) of Towage Efficiency (Quality-Cost) of Pilotage Efficiency (Quality-Cost) of Waste reception facilities Efficiency (Quality-Cost) of Mooring Efficiency (Quality-Cost) of Dredging Efficiency (Quality-Cost) of Ice-breaking Efficiency (Quality-Cost) of Bunkering On-time departure On-time arrival Port operating hours Operational depth Total length of quays Number of berths 0
0,5
1
1,5
2
2,5
3
3,5
Figure 27: GAP Analysis/Dry Bulk Market
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Cruise Market The results of the GAP Analysis reveal a smooth picture for all participant ports that operate in the Cruise Market segment. In general, as seen from the figure that follows (Figure 28) the positive gaps are not high. Availability of parking areas and the services to passengers are the factors that have been evaluated as the most unsatisfying, revealing a positive gap at the scale of 1,5. Room for improvement though is available for the rest of the criteria with positive gaps, whilst at the same time port users seem quite satisfied with the rest of the services, since a lot of criteria reveal a good balance between satisfaction and importance, with zero or low negative gaps.
GAP Analysis Cruise Market Efficiency of land transport modes Connectivity to road network Customs operating hours Hinterland intermodal connectivity Efficiency of passengers clearness procedure Services to passengers Total parking areas Total available area for passengers Port safety Port security Accuracy of information Online information On-time information Transparency of port charges Response to regulation changes Response to innovativeness Response to users requests Coordination of port community/stakeholders Baggage handling cost Cruise passengers handling cost Efficiency of baggage handling operations Efficiency of passengers embarking/disembarking … Number of operational passenger terminals Vessel-related port costs Efficiency (Quality-Cost) of Towage Efficiency (Quality-Cost) of Pilotage Efficiency (Quality-Cost) of Waste reception facilities Efficiency (Quality-Cost) of Mooring Efficiency (Quality-Cost) of Dredging Efficiency (Quality-Cost) of Ice-breaking Efficiency (Quality-Cost) of Bunkering On-time departure On-time arrival Port operating hours Operational depth Total length of the quays Efficiency of berth allocation system Number of berths -1
-0,5
0
0,5
1
1,5
2
Figure 28: GAP Analysis/Cruise Market
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