Truck Driver Shortages and Green Transition Challenges
This edition takes a closer look at the causes and potential solutions to the truck driver shortages and the green transition challenges currently plaguing the UK.
Addressing truck driver shortages one queue at a time
Truck driver shortages have been an issue for several years now and a resolve doesn’t seem to be in sight in the near future. The latest Truck driver shortages and landside port congestion report looks at the factors that play a role in this shortage from the driver supply side (driver lifestyle, pay rates and structure), the demand for transport services, to transport efficiency. One major transport inefficiency is congestion, especially in ports. Thus, the key argument of the report is quite straightforward: congestion may not be eliminated but targeted waiting time reductions could increase the productivity of truck drivers, thus alleviating the shortage.
Have a look at the full report here.
“A traffic mitigation fee that mitigates no traffic”
Whenever there is money involved in congestion management, managing congestion becomes a secondary goal. The US Federal Maritime Commission (FMC) discovered this following the temporary traffic mitigation fee (TMF) increase for daytime container deliveries in the Los Angeles/Long Beach port complex. The TMF was increased in November from $34.21 per twenty-foot equivalent unit (TEU) to $78.23 and ended on January 31st. PierPass Inc., the non-profit organisation tasked with running the congestion mitigation programe in Los Angeles since 2005, has been collecting traffic mitigation fees for more than 17 years for trucks delivering during peak times. However, the FMC found that, although PierPass’ revenues increased significantly following the TMF increase, the fee had little impact on truck traffic – in the words of FMC Chariman Daniel Maffei “Today, it [PierPass] collects a Traffic Mitigation Fee that mitigates no traffic.” Now, PierPass is asking to make the TMF rate increase permanent.
Fifty shades of green
The UK’s green transition has had a rough few months as the country discovered just how challenging it is to connect all energy needs to one energy source.
The International Energy Agency latest Electricity Market Report revealed an increase of more than 20% in energy generation emissions in 2021 compared to 2020, mainly due to low wind.
On the mobility front, electricity grid capacity issues have triggered an ongoing government discussion to switch off electric vehicle chargers during peak times. This has been rebranded as ‘smart charging’ which basically achieves the same objective – preventing charger access – through price signals.
This week, on the heating front, with more than 85% of British homes relying on gas heating systems, the government’s plan to transition 680,000 homes per year to electric heat pumps have been put under question due to a shortage in plumbers and the cost of household electricity grid upgrades required to install the pumps.
The key problem that is becoming increasingly apparent in the UK is that connecting energy needs to one energy source entails trade-offs due to the limited capacity of the electricity grid.
Traditionally, energy needs have been satisfied by different sources of energy: mobility was mainly satisfied by petroleum products, gas provided household and industrial heating, and a mix of energy sources satisfied other electricity needs. Each energy source used relatively independent infrastructure and was delivered to consumers separately. The green transition embraced by much of the Western world embraced in recent years aims to satisfy all these needs using just one energy source – renewable energy.
Behind the ambitious goals and timelines for mandates and fossil fuel use bans, there seems to be little planning for the grid capacity to deliver the renewable energy to power mobility, heating and electricity needs. Mobility should rely on electric vehicles, yet, as the number of electric vehicles increases, it is increasingly apparent that the existing grid cannot cope with electric vehicle charging needs. The transition to heat pumps faces a similar problem at a household and, likely, at a regional level.
Insufficient grid capacity means trade-offs: do I charge my car or heat my home? Do I run my fridge or my oven?
‘Smart charging’, also known as peak pricing, is not the answer. Smart charging fails to consider that some needs can’t be postponed to off peak times – a heat pump needs to pump heat when it’s cold not just when it’s cheap, electric vehicles should provide mobility when required not when the grid allows it, and refrigerators need to work continuously. Much like the traffic mitigation fee in Los Angeles, smart charging is however likely to achieve one outcome: higher profits for power suppliers.
It’s not a bug, it’s a feature
In last edition, I talked about the potential cybersecurity risks of having an internet connected vehicle such as the car getting hacked and not unlocking unless you pay. Turns out that car makers are aware of these potential issues although they prefer to call them features. Toyota, Subaru and Lexus charge a fee for providing access to an app allowing users to unlock their cars. Similarly, BMW charges a fee to unlock automatic high-beam headlights. Microtransactions are common in PC and console games and are soon on the way to your vehicle. Imagine going through your monthly car use invoice and thinking whether you can do without the $1.75/hour use of the heated steering wheel feature on the car you’ve already paid for.