Climate Change Innovation: Challenge Summaries

On 14th July 2020 we brought more than 40 innovators, entrepreneurs, businesses, researchers and experts together in a virtual design sprint to discuss the climate change challenges linked to transport, home working and home deliveries in a post-coronavirus world. Four strands emerged with numerous challenges defined.

We have summarised these challenges below and are asking that anyone with a potential solution expresses their interest in joining our Climate Change Innovation Accelerator no later than Monday 27th July 2020.

Safe Public Transport Use

The psychology of using public transport
We have a pre-existing challenge in human behaviour and that sitting next to, and sometimes standing very close to, complete strangers can lead to a negative perception of public transport. It naturally feels uncomfortable to people and can be exacerbated by personal circumstances such as: physical disability and mental illnesses such as anxiety or conditions like autism.  COVID-19 has compounded these issues, with travelling in public transport being stigmatised.

The current practices in place by most public transport providers in the UK should make people feel more comfortable, these are:

  • Focus on health and safety and making public transport “Covid secure”
  • Enhanced cleaning regimes with innovative cleaning solutions
  • Introduction of some digital app to inform passengers on transport usage
  • Other control measures: social distancing, encouraging hygiene and use of sanitisers

However, the reality is somewhat different. The current Tyne and Wear metro usage sits at around 30%/40% of normal use. This will be further impacted by social distancing by at least 1m, meaning capacity cannot exceed 45%. With take up of face covering use on Metro at 88%, passengers are taking the risk seriously and the forecast is that service demand will not go over 60% to 70% in the foreseeable future.

Demand Management
The demand for public transport has fallen dramatically and it is estimated that it will not recover above 60% or 70% in the foreseeable future. This will mean 60 million journeys disappearing with some journeys being carried out by other means of transport (cars) or being completely lost (e.g. replaced by working from home for example).

Every metro journey brings on average £8.50 to the economy as well as the health benefits associated with public transport usage. It is currently difficult for Public Transport Operators to predict with certainty what demand is going to look like and it can change quickly depending on external events – easing of lockdown, schools reopening, local lockdown, a second wave, confidence in public transport rising or decreasing.

School Transport
Haydon Bridge High School, based in rural Northumberland, has the largest catchment area in the country covering 642 square miles. Some pupils have journeys of between 45 and 55 minutes to get to school. There is already a challenge to transport pupils to school in a safe and efficient way. COVID-19 is adding to this existing challenge. Only 45% of year 10 chose to go back to school at Haydon Bridge and the perceived risks of using public transports was one of the main issues cited by parents.

Eleven buses are used under normal circumstances to provide this service to families. The 1m+ social distancing rule would mean using around 25 buses. Even if the funds were available to pay for this additional requirement, the supply of buses and drivers would be a key issue. Connectivity in rural areas is a key challenge with real impact on wellbeing, socio-demographic circumstances and education. Factors which might mitigate these issues in urban areas (alternative transport, car sharing systems) may not be possible in a rural environment. Schools are considering staggered start and other measures such as encouraging walking to school for the last mile of the journey to allow for a more efficient use of public transport, but these do not address the needs of the whole school population and the perceived danger of contagion whilst using public transport.

Safe Public Transport key considerations:

  • Wearing face masks will now be compulsory in other settings such as retail. Will this normalise behaviour and reduce the stigma of public transport as being more risky?
  • Schools are due back in September. In the context of Haydon Bridge High School in Northumberland, only 45% of Year 10 have taken up the opportunity to return to school. One of the main reasons cited is the issue of public transport and the perception that it isn’t safe to use.
  • What financial models are there to support Public Transport during the COVID-19 crisis?
  • What measures can be put in place to restrict CO2 emissions and encourage Public Transport usage?

Potential intervention:

Information and communication are key to address these issues, solutions could consider

  • Real time communication to passengers.
  • Real experience/visualisation of vehicles/stations.
  • Simple message communication to help passengers assess the risks and opportunities of using public transport.
  • Could public transport be modified, or operational alternatives introduced to deal with social distancing and the impact on demand and supply of vehicles.

Sustainable home working

Karbon Homes: remote working journey
Christine Paxton of Karbon Homes talked the group through their remote working journey, sharing the successes experienced as well of the challenges still ahead. The key challenges highlighted included collaboration, mental health support and wellbeing, and talent and skills development. We also considered company benefit packages asking the questions; will individuals still need company cars, do we need to adjust contract terms, and will we look for different characteristics in colleagues going forward?

The main outcome of this session was the point that home working is not necessarily the answer – instead, we should be calling it agile, flexible, remote or even locality working, as working in these ways can be more readily sustainable. Christine referred to a hub model, with local, community offices becoming increasingly valuable, not only because our communities are vital at this time, but also because they reduce the stress on a main office; distributing staff among several workspaces and therefore reducing the commute time for each staff member if they are able to use their nearest location.

This is not a viable model for all businesses, but as our high streets decline is there an opportunity to repurpose spaces as localised workspaces? Community workspaces have the potential to solve challenges deemed most impactful if overcome and begs the question; how can we encourage this shift in usage of community buildings to work hubs, ensuring suitable workspaces with strong connectivity and a community feel?

The issue of sustainability was also recurring – increased emissions and costs for employees working from home is a concern. There was much interest from the group in a challenge session focussed on improving efficiencies of home heating and operations as well as concern around increased costs for individuals. How can organisations support their staff to upgrade their homes accordingly and how do we encourage organisations to fairly contribute to increased costs incurred by remote working?

Benefits of sustainable home working

  • Positive impact on climate due to reduced travel, however this could be countered by increased emissions from home heating and lighting.
  • Flexibility, time saving, availability to families.
  • Increased opportunities – both for the individual to work for any global organisations and for businesses to access a much wider talent pool.

Challenges which would have the greatest impact if overcome

  • Social isolation/lack of interaction with others
  • Suitability of home working environments, practical workspaces, access to equipment
  • Increased costs for the individual, especially in the winter
  • Connectivity
  • Staff training – new skills required

Increasing the adoption of ULEVs

The barriers and challenges to increasing the adoption of ULEVs is highly complex and multi-layered, and the session delegates agreed there is no one quick fix.

However, one of the biggest barriers to adoption is the lack of, or perceived lack of, infrastructure. Large, fixed public locations such as Retail Centres and Supermarkets, who attract visitors from far and wide, were often built 30-40 years ago, so there is an obvious lack of power supply to permit more and/or high-tech infrastructure in these locations with no means of getting power to these destinations.

Furthermore, the perception of electric vehicles, lack of infrastructure and range anxiety all result from a lack consumer awareness and understanding of Ultra Low Emission Vehicles.

To help enable the adoption of electric vehicles, we need to ensure the public, businesses and communities have easy access to tools that enable education, increase knowledge and as such, increase confidence levels EV transport. By creating tools that offer accessible information, and can easily highlight the financial, societal and environmental benefits of EV adoption and demonstrate the EV experience, we can begin to address the barriers to EV adoption amongst consumer behaviour.

Key considerations:

  • Where there are power constraints for fixed sites, what opportunities are there to provide alternative energy solutions to enable infrastructure to be built?
  • Grass roots education.
  • The EV experience, what does it feel like. What is the consumer buying into?

Reducing the environmental footprint of on demand and home delivery services (last mile logistics)

Consolidation
The biggest factor leading to disproportionate emissions in the last mile is the lack of consolidation. In the earlier links in the delivery chain, such as from manufacturer to warehouse or warehouse to a local depot, a large number of items are carried together in larger vehicles and delivered to a single place. The last mile of delivery means smaller, less efficient vehicles going to lots of different places.

In addition, B2C delivery services are less efficient than deliveries to businesses (B2B) due to lower density of deliveries. B2C deliveries tend to involve parcels with less items inside, less parcels being delivered at one time to a single address and larger distances between delivery addresses.

One approach used in numerous trials is to have local consolidation centres, where larger vehicles deliver parcels in bulk before smaller (potentially more efficient) vehicles carry out the last stage of delivery. In urban areas, this opens up opportunities for very low emission approaches, such as bicycle delivery services. However, many trials have failed due to logistics companies seeing consolidation centres as slowing down supply chains, reducing flexibility or increasing costs (both operating costs and high costs related to renting suitable land in urban areas). The examples which have worked tend to be driven by regulation or specific local constraints.

Urban Consolidation Centres “reduce the numbers of freight vehicles operating within the urban area (Browne et al., 2005) and reported reductions in vehicle trips and kilometres travelled have been between 60% and 80%, with associated reductions in greenhouse gas emissions of between 25% to 80%”.

One particular study looked at student halls of residence as an example. The work showed that effective consolidation could result in a reduction in total courier visits by 98% but would cost around £18 per recipient per year. It would also require the majority of individuals sign up to the scheme (or be forced to use it).

  • How might we encourage more consolidation?
  • How might we make consolidation centres more attractive for delivery companies to use?
  • How might we drive consolidation amongst smaller food and drink providers?
  • How might we make more use of rail or bus links for light goods?

Urban and rural factors
The effects of consolidation issues are greater in rural areas, where the distance between delivery addresses is greater. On the flip side, increasing numbers of LGVs in urban areas and increasing congestion are issues there, impacting on delivery efficiency and emissions. As more urban clean air restrictions come into force this will also have an impact.

  • How might we better tailor logistics services to specific environments?
  • How might we create a more holistic approach for rural communities, potentially making use of community hubs or motivated individuals?

Consumer demands
Shifting expectations, to some extent driven by the so-called ‘Amazon effect’, mean that to compete in the e-commerce market retailers need to offer more flexible and speedy delivery options. The ability to receive our purchases next day (or even same day) has been shown to be a significant factor in purchase decisions. One McKinsey study found that 30% of consumers would be willing to bear the (significant) extra costs if it meant receiving their goods on the same day as ordering.

The second shift is in consumer expectations of delivery windows and flexibility. Delivery services are much more efficient if the recipient is in when they arrive and ready for the delivery but this means informing the recipient in advance and committing to a tight delivery window. Consumers often expect to have some choice in delivery windows as well, an effect driven to extremes in terms of fresh food delivery. An Italian study showed that reducing delivery windows from all day (and asking recipients to wait in for delivery) to a chosen two hour time slot meant a 400% increase in emissions due to reduced efficiency in delivery routing.

These shifts in consumer expectations show no sign of reversing, so any solution must take them into account.

  • How might we make the costs and environmental impact of last mile delivery more transparent to consumers and help influence behaviour?

Missed deliveries
One reason why logistics companies have moved towards tighter time slots is to ensure that the recipient is present to receive the delivery. Missed deliveries, generally due to the recipient not answering the door, are a significant issue for retailers and logistics companies, with re-delivery estimated to cost retailers £4.90 per package according to IMRG (the UK’s online retail association). This matters particularly when delivery is offered for free or subsidised, as is common with B2C services. The total costs of missed and late deliveries in the UK is estimated at £1.6bn per year.

Recently, there has been a shift to couriers making more use of alternative drop mechanisms (e.g. leaving parcels in a safe place or with a neighbour). This reduces missed delivery frequency but raises other questions around security and convenience.

  • How might we increase communication with recipients to ensure they are present?
  • How might we use mobile local hubs to drive efficiencies?

Returns
Unlike B2B supply deliveries, B2C e-commerce includes a significant level of returns. In fashion retail, for example, between 20% and 30% of items end up being returned (Barclays data). This is problematic because the logistics operations are primarily designed to work efficiently in one direction. Collection of items slows down routing, is less predictable and there are more likely to be issues with poorly packaged items or inaccurate addressing. Therefore, returns tend to be managed separately to the delivery process, through consumers dropping off items at a depot or local store.

  • How might we enable better management of returns could reduce emissions by making use of delivery vehicles as they return to depots empty?

Routing and addressing
The problem of efficient routing for delivery rounds has been tackled by numerous academics and businesses over the years. Whilst it is unlikely that big step changes will be seen in the near future, even very small improvements could have a significant impact on emissions (and costs) given the sheer number of miles being driven every year. In particular current routing algorithms may not take into account the dynamic factors at play at that point in time, such as traffic conditions, weather or even noting if the recipient is likely to be in.

A more immediate problem is around addressing. Inaccurate or imprecise addressing is a key cause of missed deliveries and inefficiencies, to the extent that some researchers have started talking about the ‘last 30m’ as being more of a problem than the ‘last mile’. Even when items have been addressed and sorted correctly, postcodes may describe anything from an entire hamlet of spread out houses down to a part of a large building. They do not relate across well to geolocation tools (like GPS) that could give an absolute location.

In addition, addressing cannot take account of specific limitations regarding an address which may impact on delivery times. For example, traffic and parking limitations, steps, access restrictions or delivery to the front or rear of an address will not be available information for the routing software or delivery driver. The success and time taken for a delivery could come down to something as mundane as the big dog living at the property and whether it is inside or outside when the driver arrives.

  • How might we enable more dynamic routing?
  • How might we better manage the last few metres of delivery, such as management of kerbside space in busy cities?

Vehicle types
The vast majority of vehicles used for last mile delivery are either part of small business fleets or owned by individuals. This means that they are very diverse and tend to be older, less efficient vehicles. In particular, there is a high concentration of diesel-powered light vans.

Short of national regulation or local initiatives like clean air zones, it is difficult to see how small operators can be persuaded to move to less polluting vehicles in the short term, as the capital costs of changing are high and availability of electric vans (for example) is poor.

  • How might we encourage the use of the more polluting vehicles for longer legs of journeys?
  • How might we enable the utilisation of other, less polluting vehicle types for last mile delivery?
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