Melbourne Port@L Strategy Consultation Draft

MELBOURNE PORT@L STRATEGY

CONSULTATION DRAFT

AUGUST 2006

CONTENTS

Introduction 02 Victoria’s future freight task 05 The need for a Port@L Strategy 07 Principles of the Port@L Strategy 09 Key elements of the Port@L Strategy 13 Staging of the Port@L Strategy 19 Responding to the Consultation Draft 21

Figures Figure 1 Metropolitan Freight Flows 03 Figure 2 Forecast growth in international container trade by origin/destination 05 Figure 3 Port@L Strategy Scope 08 Figure 4 Melbourne Port@L – Port Related Areas 10 Figure 5 Illustrative interface between MIT and port terminals 16 Figure 6 A possible timeline for implementation of potential Port@L projects 19

MELBOURNE PORT@L STRATEGY INTRODUCTION

The Port of Melbourne is Australia’s leading container port. Together with the adjacent Dynon rail and transport precinct and an extensive network of road and rail connections and freight terminals, it forms one of the nation’s most important freight infrastructure assets. The Melbourne Port@L Strategy aims to develop all of these elements into a world-class intermodal freight system, securing Victoria’s position as Australia’s freight capital and contributing to sustainable economic growth and development across the State.

What is Port@L? Melbourne Port@L is the Victorian Government’s vision to The objective of the strategy develop the Port of Melbourne, the Dynon precinct and its The Port@L Strategy aims to deliver a practical, transport links as a world-class intermodal freight hub. long-term framework to guide integration of the Port and associated land transport infrastructure The Melbourne Port@L Board was formed by the Victorian and operations into an efficient, well-connected Minister for Transport, Peter Batchelor, in June 2004, and sustainable intermodal freight system over bringing together the heads of Victoria’s port, the next 30 years. rail and road authorities. Board membership includes the CEOs of the Port of Melbourne Corporation, VicRoads and VicTrack, and the Port@L in context Executive Director of Freight, Logistics and Marine in the The Melbourne Port@L Strategy is closely aligned with Department of Infrastructure. a number of key Victorian Government strategies and The Port@L Board has responsibility for preparing priorities, including: a high-level Melbourne Port@L Strategy and guiding its n Melbourne 2030,which provides a plan to sustainably effective and sustainable implementation, working closely manage urban population growth of up to one million with industry stakeholders and local communities. people by 2030. n Growing Victoria Together, the Government’s The Consultation Draft long-term vision for the State’s future, which includes the objective of increasing the proportion of freight This Consultation Draft sets out the context and key carried to and from Victoria’s ports by rail drivers for the strategy and the principles and key to 30% by 2010. strategic elements which constitute it. n Victorian Ports Strategic Framework, which sets out The Government supports this Consultation Draft as a basis roles and a broad sequence of development for for public consultation and feedback from industry and Victoria’s commercial trading ports over the next community stakeholders. 30 years. A key direction in the framework is to Once feedback is received, a final Melbourne maintain the Port of Melbourne as Australia’s premier Port@L Strategy will be presented to the Government container port. for endorsement. n Port of Melbourne Corporation’s Draft Port The Board and the Government will then work Development Plan, which sets out a plan to manage with stakeholders to develop a more detailed the growth of trade through the Port of Melbourne implementation program. over the next 30 years. n Meeting Our Transport Challenges, which is the Government’s action blueprint for investment in Victoria’s transport networks over the next 10 years and beyond.

MELBOURNE PORT@L STRATEGY Northern Industrial Hub

Melbourne

SW Industrial Hub Melbourne Port@L Core Port Precincts SE Industrial Hub Port of Melbourne

Avalon

PORT PHILLIP Port of Geelong BAY

Port of Hastings Existing freight flows Future freight flows EastLink under construction Pakenham Bypass under construction WESTERN PORT Rail line Urban area NORTH Key metro industrial areas 0 10 20 km Proposed major industrial areas Figure 1. Metropolitan Freight Flows Shipping channel

Northern Industrial Hub

Melbourne

SW Industrial Hub Melbourne Port@L Core Port Precincts SE Industrial Hub Port of Melbourne

Avalon

PORT PHILLIP Port of Geelong BAY

Victoria’s future freight task

Managing the sustained growth of freight movements, particularly international containers moving within the metropolitan area, is a key challenge for the Victorian freight and logistics system.

Victoria’s total freight task is expected to more than double This trend is being strongly driven by growth in over the next 30 years. Freight movements within the import containers bound for the metropolitan market. Melbourne metropolitan area represent 70 per cent of the Metropolitan import containers as a proportion of the Victorian freight task (in tonnes). A significant and growing total international container trade (imports and exports) proportion of this freight movement is centred around are expected to rise from 49% to 64% by 2035. the Port of Melbourne. The origins and destinations of these international The Port of Melbourne is a multi-trade port, trading in containers are increasingly likely to be concentrated international and coastal containers (including Bass Strait), in well-defined outer-urban industrial areas to the north, new motor vehicles, break bulk (non bulk cargo that is not west and south-east of the city. containerised), dry bulk (such as grain and cement) and liquid bulk (such as crude oil). “International container trade is projected Increasingly, the port’s operations are dominated by container trade. Annual growth rates in international to increase fivefold from 1.4 million TEU container trade are expected to be double those for bulk per year in 2005, to 7 million TEU by 2035.” and motor vehicle trades. International container trade is projected to increase The need to sustainably manage this growing metropolitan five-fold from 1.4 million TEU (Twenty-foot Equivalent freight task has significant implications for infrastructure container Units) per year in 2005, to 7 million TEU by 2035. development and operations in and around the port Of this international container trade, 77 per cent has and its transport linkages to the broader Melbourne origins or destinations in the Melbourne metropolitan area. metropolitan area. This proportion is expected to rise to 84 per cent by 2035.

Figure 2 – Forecast growth in international container trade by origin/destination

6,000

5,000

4,000

3,000 ‘000 TEUs 2,000

1,000

0 2005 2035 2005 2035 2005 2035

RURAL INTERSTATE METROPOLITAN

MELBOURNE PORT@L STRATEGY 5

The need for a Port@L Strategy

With the metropolitan container task expected to grow strongly over the next 30 years, Victoria needs to better integrate the Port of Melbourne with road and rail infrastructure and freight terminal facilities servicing the metropolitan market to ensure freight can be moved quickly and efficiently with minimum adverse social and environmental impacts.

Victoria faces significant challenges in managing its strong In addition to measures to support penetration growth in international trade, particularly containers. of the metropolitan freight market by rail, measures to improve road freight efficiency The Government has already announced its support, and truck utilisation will also be required. subject to environmental approvals, for deepening the shipping channels into the Port of Melbourne to accommodate larger, new generation container vessels. This project will greatly enhance the port’s international “Without complementary improvements competitiveness and ability to cost-effectively cater for to land side port and transport infrastructure the predicted growth in trade. and systems, the ability to distribute However, without complementary improvements to increased freight volumes to and from land-side port and transport infrastructure and systems, the Port efficiently and without significant the ability to distribute increased freight volumes to and from the port efficiently and without significant impact impact on urban amenity will become on urban amenity will become increasingly constrained. increasingly constrained.” To address general concerns about road congestion and amenity pressures created by increased truck trips, the Victorian Government has already set a target of More generally, effectively managing the growing port moving 30 per cent of all port trade in Victoria (excluding freight task will require optimal use of existing road, liquid bulk) by rail by 2010. rail and port infrastructure and the development of new infrastructure where required to meet demand. While rail has a dominant share of regional export freight and a significant share of inter-capital port- The Port@L Strategy is needed to provide an effective related container freight, it is almost unrepresented long term strategic planning framework to manage in the Melbourne metropolitan freight market, due to the impact of strong trade growth on the port, the current cost and time disadvantages of rail relative Victoria’s wider transport and industrial infrastructure to road transport over short journeys. and on surrounding communities. Because most international freight has origins or destinations in the metropolitan area, achieving the Government’s rail mode share target will require careful consideration of a range of possible measures to address the sources of these disadvantages.

MELBOURNE PORT@L STRATEGY 7 The need for a Port@L Strategy

The strategy will encourage the sustainable n providing the clarity of direction necessary management of future trade growth by: to leverage private sector investment in the port and freight network; n affirming the value of the port and related freight precincts to Victoria as key economic n promoting improved efficiency of port road freight and community assets; movements and a higher proportion of total port freight moved by rail; and, n providing a clear policy and planning framework to deal with development issues as they arise; n taking account of the precinct’s interfaces with and impacts on neighbouring communities. n providing a rational basis for prioritising and staging infrastructure initiatives;

Figure 3 – Port@L Strategy Scope Port@L

MELBOURNE PORT ENVIRONS AND INNER SUBURBS METRO, RURAL AND INTERSTATE

Swanson Dynon precinct Inland Terminals

Webb and other Inner road Outer road port infrastructure Access, and rail and rail queuing and networks circulation Users Ancillary services infrastructure infrastructure

PORT DEMAND ELEMENTS ROAD AND RAIL ELEMENTS

MELBOURNE PORT@L STRATEGY Principles of the Port@L Strategy

The strategy is guided by four high-level principles to ensure it delivers on the Government’s broad policy intentions and creates maximum economic and community benefits.

Principle 1: Integration Principle 3: Competitiveness Effective physical and operational integration Ensuring the Port of Melbourne remains of the three key modes of transport – road, the pre-eminent international container port rail and sea – within the central port precincts in Australia, reinforcing Victoria’s position and between those precincts and satellite as the nation’s manufacturing hub. intermodal precincts. The strategy will encourage innovation and leading The strategy will adopt a long-term approach to creating edge intermodal freight operations to drive increased a world-class intermodal freight hub that enhances productivity and greater competitiveness of the Port the integration of the Port of Melbourne and adjacent of Melbourne and the broader freight network. land transport facilities with the overall freight network in Victoria. The strategy will promote an integrated freight network, encompassing physical infrastructure, Principle 4: Sustainability commercial relationships, governance arrangements Balancing commercial viability with and regulatory tools. social and environmental sustainability. The strategy will adopt a sustainable approach, Principle 2: Efficiency taking into account community and environmental as well as economic perspectives. Road congestion, Full utilisation of existing impacts of truck traffic on urban amenity, noise, infrastructure and efficient staging light intrusion and other impacts of freight operations of new infrastructure development. are all significant issues. The strategy will balance The strategy will encourage enhanced efficiency across industry and community needs to deliver a network the freight network through the better use of existing that is competitive and sustainable into the future. physical infrastructure; the appropriate timing of new infrastructure; and the use of effective supporting administrative arrangements to ensure cohesion of operations between market participants.

MELBOURNE PORT@L STRATEGY Melbourne Port@L – PORT RELATED AREAS Figure 4

ls n ong and rminal n ermina t Te e T s sed future Danden po To o (not port owned)

ermodal s pr t s ) s

In k rt Rail Link grad n s ansport precinct Po Tr rt@L precinct rt area rt related area tential alternative road freight tential alternative east/west rminal eight rail lin Po Proposed Metropolitan Intermodal Te Fr Dynon separatio Proposed freight rail connectio Rail / Po Po Proposed dock extension Po traffic route from the west (medium term Po road link and port precinc connectivity (medium-long term) Seamless interface betwee Metropolitan Intermodal and stevedore D LEGEN related areas rt MIT @L - po rt Po Melbourne

est

ham &

tten

h & inals

To rt

ermodal

t rm

To No In Te

10 MELBOURNE PORT@L STRATEGY MELBOURNE PORT@L STRATEGY 11 12 MELBOURNE PORT@L Key elements of the Port@L Strategy

The Port@L Strategy is founded on a set of key strategic elements that will drive and provide a coherent framework for consideration of future initiatives and infrastructure investments.

The Port@L Board has developed six key elements, East and West Swanson Dock, the land supporting these which form the basis of the strategy. These elements facilities and the land immediately to the north across are strongly interrelated. Footscray Road constitute the initial core focus of Port@L. Implementation of the elements will necessarily involve In particular the Melbourne Wholesale Market site, which consideration of appropriate future management sits between the docks and the South Dynon rail terminal, arrangements for relevant infrastructure and systems. is identified as a key strategic site for the development of intermodal facilities within the precinct. Subsequent planning, development and programming of more specific infrastructure projects and initiatives will The current Melbourne Markets Authority site will be sold be driven by and progressed in a manner that is consistent to the Department of Infrastructure with arrangements with these strategic elements. for the sale to commence immediately. The precinct generally is ideally placed to efficiently Element 1 accommodate the significant container volumes predicted to flow through the port, until at least 2015-2020. Give initial priority to core container handling Effectively developed and operated, it is estimated operations in the Swanson Dynon precinct. that this precinct alone could handle up to four million The Victorian Ports Strategic Framework and the Draft TEUs per annum. Port Development Plan confirm that Swanson Dock will The strategy gives priority to initiatives designed to be the major international container facility in the Port of effectively maximise the capacity of the Swanson Dynon Melbourne in the short to medium term, with Webb Dock precinct to handle containers by: providing the next phase of increased capacity. n fully utilising and building upon shipside and landside Swanson Dock handles the great majority of import infrastructure already in place; and export containers. These containers also pass through the adjacent Dynon rail and transport precinct, n extending Swanson Dock northwards to create which also handles a significant domestic freight task greater quay length and to accommodate larger, (ie: freight that has no connection with the port). deeper draft ships; The Swanson Dynon precinct has many historical and n improving the efficiency of container operations geographical advantages. As well as hosting the nation’s at Swanson Dock through implementation of best largest container stevedoring terminals, it has excellent practice container handling technology and freight highway connections to freight generation centres and management systems; extensive rail terminal facilities. Most importantly, it has n progressively allocating adequate land adjacent to the the potential to accommodate a significant expansion in docks to core container handling operations (stevedoring, freight handling capacity within its existing land footprint. marshalling and intermodal operations); and, On the other hand, as the precinct occupies a central n progressively developing strategic sites, such as the urban location, it is not surprisingly under pressure from Melbourne Wholesale Market, site for intermodal, competing demands for land use. The precinct’s transport rail and related transport handling operations. corridors are shared with large volumes of non port-related freight and passenger vehicle traffic. Access points and internal road and rail linkages are not necessarily optimally located to serve future needs.

MELBOURNE PORT@L STRATEGY 13 Key elements of the Port@L Strategy

Element 2 Element 3 Progressively decentralise non-core container Progressively direct growth in domestic freight handling activities. handling operations to outer suburban locations. Activities and operations that do not need to be located The Dynon precinct has traditionally handled most close to core container handling operations will be domestic interstate and regional rail freight with origins encouraged to relocate, to other suitable locations within or destinations in the metropolitan area. the Dynon area and to industrial hubs remote Although historically this domestic freight has been from the port but with access to efficient intermodal handled in a central city location, it is subsequently facilities connecting to the port. distributed, usually by road, to final destinations across The strategy will: the metropolitan area. n encourage the relocation of activities which do not The advent of the Western Ring Road, Eastlink and other require close proximity to the docks away from the orbital road links provides the potential for efficient Swanson Dynon precinct to release land for core handling of this domestic freight task from outer urban container handling activities; intermodal hubs, removing the need for it to come into the Swanson Dynon precinct. This in turn would n promote the development of a network of intermodal relieve road congestion in the central metropolitan terminals in outer-urban industrial centres with efficient area and around the port. rail and road links to the Swanson Dynon precinct; and, Therefore, while retaining the existing South Dynon n encourage container storage, packing and other terminal as the primary hub for Melbourne’s inter-capital value add activities to be progressively located near rail freight for the foreseeable future, the strategy aims these outer-urban terminals, away from the central to progressively increase domestic intermodal freight port precinct. handling capacity at outer-urban terminals (eg. Somerton) to augment South Dynon’s capacity. “Activities and operations that do not need to be located close to core container The strategy: handling operations will be encouraged n encourages the development of outer-urban intermodal freight terminals that can accommodate growth to relocate...” in inter-capital and regional domestic rail freight; n promotes creation of a more efficient road freight distribution network to support this increased role for outer-urban terminals; and, n proposes, at an appropriate time, to relocate other domestic freight operations, such as the Dynon steel terminal, to suitable outer-urban locations (with dual gauge rail access and good road access) to release current sites for more strategic freight purposes.

14 MELBOURNE PORT@L STRATEGY Element 4 In conjunction with this broader metropolitan transport network planning work, the strategy will: Reconfigure and upgrade the road network in and around the port. n encourage the staged development of alternative east-west route(s) in and to the north of the Swanson Road traffic in and around the port consists of Dynon precinct, to allow for the segregation of through a mixture of freight vehicles bound for the port or Dynon traffic from port-related traffic; rail terminals and private and commercial through-traffic bound for other destinations. The Swanson Dynon precinct n assist in identifying new access routes into the is divided by Footscray Road, a metropolitan arterial road, Swanson Dynon precinct from the north, which would which services all of these needs. link effectively with an alternative east-west route; For the Port@L concept to work effectively, it will be necessary to improve connectivity between Swanson “For the Port@L concept to work Dock to the south and current and future rail facilities to the north. effectively, it will be necessary to improve connectivity between Swanson Dock and This is likely to require consideration of design solutions (eg grade separation of Footscray Road) and/or the the rail facilities to the north.” provision of alternative east-west routes for through traffic. These are matters which will be fully considered in n progressively promote improved north-south the $5 million East-West Link Needs Assessment, recently connectivity within the Swanson Dynon precinct announced in the Government’s Meeting Our Transport through measures to modify road design and/or Challenges statement. reduce through-traffic; In addition, the need to manage traffic congestion and n assist in improving amenity in the inner western amenity impacts, particularly truck traffic impacts in the suburbs adjacent to the port by encouraging provision Inner West, will require consideration of alternative freight of alternative freight routes to remove truck traffic routes through that area. This issue will also be considered from residential areas; and, in the context of the East-West study. n encourage improved road access to the Webb Dock precinct from the West Gate Freeway through enhancements to Todd Road and Plummer Street, separating truck traffic from local residential areas.

MELBOURNE PORT@L STRATEGY 15 Key elements of the Port@L Strategy

Element 5 Promoting an increase in rail activity will also require a systematic rail growth plan that recognises the current Progressively implement an efficient lack of cost competitiveness of short-haul urban freight rail. metropolitan rail freight system. Such a plan will need to address issues such as terminal A key focus of the strategy will be to develop effective governance, track access, operating protocols and other policy rail and intermodal capability to address the challenge initiatives considered appropriate to encourage the use of rail of moving more freight onto rail. The Swanson Dynon shuttles from the port to outer-urban intermodal terminals. precinct, with its advantages of location, transport linkages The strategy aims to facilitate increased rail activity by: and land availability, is uniquely suited to form the hub of a highly efficient, purpose-built metropolitan rail • constructing the Dynon Port Rail Link project to improve freight system. direct rail access to the port; The Dynon Port Rail Link project, due to be completed in • utilising the land to the north of Footscray Road, 2009, is the first Victorian project with a substantial rail currently occupied by the Melbourne Wholesale Markets, component funded under the Australian Government’s for the development of a new purpose-designed AusLink program (AusLink is contributing $110 million, the Metropolitan Intermodal Terminal (MIT); balance being funded by the State Government and the port). • promoting the pivotal role of the MIT in the development By grade separating Footscray Road over new dual gauge of a coordinated network of outer-urban intermodal rail rail tracks servicing East and West Swanson Docks, terminals, with close operational connections to container Appleton Dock, Victoria Dock and, potentially, Webb Dock, berths at the Port of Melbourne; it will significantly improve the port’s capacity to receive and dispatch freight directly by rail.

Figure 5 – Illustrative interface between MIT and port terminals

NORTH & WEST Metropolitan Intermodal Terminal EAST

Footscray Road (for general port traffic)

Mackenzie Priority internal road Street for access to stevedores

Former Appleton Dock Road Dynon Port Rail Link

Swanson Dock

16 MELBOURNE PORT@L STRATEGY • identifying improvements to freight rail connections Element 6 between the Swanson Dynon precinct and outer urban industrial hubs in the west, north and south-east, Balance freight infrastructure and operating including consideration of the role of the broad- requirements with community, social and gauge urban network in servicing these facilities; environmental goals A key driver for the Port@L Strategy is the need to accommodate the rapidly growing freight task “The Swanson Dynon precinct, in a sustainable manner. is uniquely suited to form the hub In particular, the strategy seeks to address the adverse of a highly efficient, purpose built amenity impacts of congestion and truck traffic on metropolitan rail freight system.” communities in an integrated manner. This will include improvements to the functionality • promoting the progressive introduction of highly and efficiency of the road system and reducing pressure efficient metropolitan port shuttle trains running on the road system by building capability in the rail system between outer-urban intermodal terminals to more effectively share the freight transport task. and the Swanson Dynon precinct; and, The strategy aims to ensure sustainable outcomes • supporting re-establishment of an efficient rail by ensuring that responsible agencies: connection for container operations between • undertake effective, ongoing communication the Swanson Dynon precinct and the Webb and consultation with councils, community groups Dock precinct. and other local stakeholders; • fully recognise and address amenity issues in Port@L planning and development; and, • develop and implement effective buffering and environmental management strategies to deal with interface issues around Port@L-related freight terminals and transport corridors.

MELBOURNE PORT@L STRATEGY 17

Staging of the Port@L Strategy

The Port@L Strategy will be implemented progressively through a sensible sequence of infrastructure projects and initiatives designed to efficiently address the emerging freight task.

Melbourne Port@L will be implemented progressively with developments undertaken in accordance with the strategy, Figure 6 – A possible timeline for as needs and opportunities arise. Improving efficiency and implementation of potential Port@L projects addressing capacity constraints will be key drivers of the future mix and sequence of developments. 2006 n Road improvements in the Swanson/Appleton Dock areas * (Element 4) A possible broad sequence of infrastructure projects n Rail enhancements in and between the and initiatives designed to provide sufficient transport Tottenham and Dynon terminals * (Element 5) and intermodal infrastructure to meet the forecast growth in freight demand is provided opposite. n Assessment of needs/options for alternative east-west road link * (Element 4) Efficient connections to the metropolitan freeway n Construction of Dynon Port Rail Link * (Element 4) network remain a priority for Port@L. The internal n Improvements to Plummer Street * configuration of port-related roads must also facilitate and Todd Road (Element 4) efficient freight transfers. n Coordinated development of outer-urban Development of rail capacity will also be a critical priority. intermodal terminals (Element 2) The strategy proposes the creation of a metropolitan rail system capable of delivering an integrated intermodal 2010 n Relocation of Wholesale Markets response to growing freight demand. Providing such to Epping (Element 5) a system will be a significant undertaking, involving the dedication of significant areas of land and the n Development of Metropolitan Intermodal modernisation and re-orientation of major historical Terminal on wholesale markets site north infrastructure assets. of Footscray Road (Element 5) n Implementation of improved north-south intraport connectivity (Element 4) n Improvements to road freight network in inner west to address amenity issues (Element 4) n Improvement of road access to the Port from the north (Element 4) n Possible northward extension of Swanson Dock (Element 1)

2015 n Construction of Webb Dock rail connection (Element 5) n Development of Webb Dock for international containers (Element 5) n Possible relocation of steel terminal outside Dynon area (Element 3)

* Projects funded and/or currently in progress

Note: Potential Port@L projects remain subject to Government approval processes and may be funded from a number of sources, including the private sector.

MELBOURNE PORT@L STRATEGY 19

Responding to the Consultation Draft

The Melbourne Port@L Board is seeking feedback on this Consultation Draft.

The Melbourne Port@L Board is seeking comment For further information on the Port@L Strategy and specific feedback on the four A copy of the Melbourne Port@L Consultation Draft principles and six key elements which define the strategy. can be viewed at www.doi.vic.gov.au/ports Are the strategy’s principles and strategic elements More detailed briefings can be provided on request appropriate and sufficient to enable its objectives to stakeholders and community organisations. For further to be met? Are there different or additional elements information contact: that should be considered for inclusion? Freight Logistics and Marine Division 03 9655 8700 To provide comments Written submissions should be forwarded to: Next steps Melbourne Port@L Board The next steps to be taken by the Port@L Board will be to: c/- Freight Logistics and Marine Division n consider responses to the Consultation Draft; Department of Infrastructure Level 19, 80 Collins Street n undertake more detailed work on aspects of the Port@L Melbourne 3000 Strategy where required; Or via email to: [email protected] n finalise and, subject to Government endorsement, publicly release the Port@L Strategy; and, The deadline for submissions is 9 October 2006. n develop a more detailed implementation plan for the strategy.

MELBOURNE PORT@L STRATEGY 21 2535 DOI/06