In association with Felixstowe Port Logistics Study

Final Report For Suffolk Coastal District Council

October 2008

Felixstowe Port Logistics Study

Suffolk Coastal District Council

A report submitted by GHK

in association with

Haskoning UK Ltd.

Date: 30/10/2008

526 Fulham Road, London SW6 5NR Tel: 020 7471 8000; Fax: 020 7736 0784 www.ghkint.com

Document Control

Document Felixstowe Port Logistics Study

Prepared by Jamie Simpson (GHK), Colin Arnott (GHK), John Vercoe (RH)

Checked by Andrew Davidge (GHK)

Date 30 October 2008

Felixstowe Port Logistics Study Final Report October 2008

CONTENTS

EXECUTIVE SUMMARY ...... I 1 INTRODUCTION...... 1 1.1 Objectives...... 1 1.2 Background ...... 1 1.3 Scope and Method ...... 2 1.3.1 Data sources ...... 4 1.4 Report Structure ...... 4 2 THE UK CONTAINER PORT MARKET ...... 5 2.1 National Container Traffic...... 5 2.2 Felixstowe: The Leading National Gateway Port ...... 6 2.3 Container Growth Forecasts ...... 7 2.4 Supply and Competition ...... 8 2.5 UK Ports: Pressures for Change...... 9 3 PORT – LOGISTICS IN TRANSITION ...... 13 3.1 Golden Triangle vs Port Centric Models...... 13 3.1.1 Current factors shaping off-port land use...... 15 3.2 Inland Connectivity and Infrastructure: Making the Links...... 16 3.2.1 Modal Splits: Road is Dominant – Rail is a Priority ...... 17 3.3 Rail: The capacity challenge ...... 17 3.4 Road: Policy context, modal shift and planning issues ...... 21 3.4.1 The Critical Strategic Link: The A14 Trunk Road Traffic Conditions and Strategy...... 21 3.4.2 The Highway Authority, Suffolk County Council...... 22 3.4.3 Lorry Parking/Operation Stack ...... 22 3.4.4 Road issues and off-port land selection criteria ...... 24 4 FELIXSTOWE: PORT TRAFFIC FORECASTS ...... 26 4.1 Forecast of Felixstowe’s Container Traffic ...... 26 4.2 Scenario A Planning for Success...... 26 4.3 Scenario B Business as Usual ...... 29 5 LAND IMPLICATIONS OF PORT GROWTH AND LOGISTICS...... 31 5.1 From Traffic Forecasts to Land Requirements...... 31 5.1.1 Interaction between On-port and Off-port Activities ...... 31 5.1.2 Projecting Off-port Land Requirements...... 32 5.1.3 Method 1...... 33 5.1.4 Method 2...... 34 5.2 Model Results: Potential Land Requirements ...... 35 5.3 Summary of Sensitivities and Uncertainties...... 39 6 SUPPLY OF LAND ...... 40 6.1 Regional and local planning policies and frameworks ...... 41 6.1.1 RSS Policy and targets for economic/employment and housing growth ...... 41

Felixstowe Port Logistics Study Final Report October 2008

6.1.2 Regional Economic Strategy ...... 42 6.1.3 National Statutory Spatial Policy and Guidance...... 43 6.1.4 Local Planning Policy on Employment Land for Logistics and Port-related Distribution...... 45 6.2 Identifying a Pool of Sites from which to Draw...... 46 6.3 Creating the Long List of Sites ...... 47 6.4 Site Screening to Create a Short List of Sites...... 55 6.5 Detailed Criteria for the Appraisal of Potential Sites and Locations...... 58 7 SUMMARY AND RECOMMENDATIONS ...... 60 7.1 Off Port Land Demand and Supply Balance ...... 60 7.2 Summary ...... 62 7.3 Recommendations and Next Steps...... 63

Felixstowe Port Logistics Study Final Report October 2008

EXECUTIVE SUMMARY

Objectives and Scope The competitiveness and sustainable growth of the Port of Felixstowe and related logistics services is a key strategic objective of Suffolk Coast District and its partners. Within this context, the primary objective of the Felixstowe Port Logistics Study is to identify the key land use issues and requirements likely to emerge from the proposed Felixstowe South Reconfiguration (FSR) in order to inform local and regional decision- making. The study is intended to inform the preparation of Development Plan Documents (DPD) produced by local planning authorities within the LDF planning process. It is intended to provide part of the evidence base to identify potential sites and support land allocations that would be suitable to support the sustainable expansion of the Port of Felixstowe and related port uses. The study will provide part of two key elements of a sound evidence base for the DPD required by PPS12, namely: ƒ Participation: evidence of the views of the local community and others who have a stake in the future of the area. ƒ Research/ fact finding: evidence that the choices made by the plan are backed up by the background facts.

Suffolk Coastal District Council has also recognised that port-related land requirements are likely to extend beyond its borders into the sub-region. The neighbouring local authorities, including Ipswich Borough Council, Babergh District Council, Mid Suffolk District Council, St. Edmundsbury Borough Council and Forest Heath District Council, are also in the process of preparing Development Plan Documents (DPD) and have been involved throughout the study process. This study will also feed into their Development Plan Document preparation processes.

Port of Felixstowe Market Positioning and Traffic Growth The Port of Felixstowe is the largest container port in the UK – handling over 3 million TEUs and having about 40% of the container market. The Port of Felixstowe is a national gateway port serving the wider Great Britain market – the port’s success is a national concern as well as local. Going forward, competition in the port sector is expected to intensify with more capacity coming on stream and shipping lines aggressively pursuing cost reduction strategies and exercising greater commercial bargaining power. Supporting the port’s competitiveness is important. Against this background, the container traffic forecasts for the Port of Felixstowe are summarised in the Table ES1.

Table ES1 Port of Felixstowe Container Traffic Forecasts (Mn TEUs)

Scenario / mn TEU 2007 2011 2013 2018 2023

Planning for Success 3.3 3.5 3.8 4.5 5.3

Business as Usual 3.3 3.5 3.8 4.1

Delayed competing capacity 4.2 3.8 4.5 5.3

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Drivers of the Demand for Off Port Land The drivers for off-port land are: ƒ Growth in port traffic volumes – the focus here is on the container trade and the future scenarios relate to overall market growth and the Port of Felixstowe’s success on securing market share as new capacity comes on stream from competing ports; ƒ Cargo handling operational modes - the nature of on and off port operational practices shape demand for land; for planning purposes it was assumed that the current practices are maintained (quay and yard efficiencies, dwell time, storage preferences, etc); ƒ Modal splits – of the 90% of the container traffic volume that relates to inland cargo origins and destinations, it is assumed that 25% is handled by rail and at least 45% goes to / from the port to destinations outside the study area by road, and the balance about 30% generates demand for off-port land uses in the study area. In line with wider policy goals, a preference is to use rail for inland moves however it is recognised that rail’s competitive offer improves over longer distances; and ƒ Logistics services – the off port logistics services include container storage (laden and empty) and warehousing and each segments has varying land use requirements (area, shape of plots, etc) and thus impact on demand. The preference is to support value-added logistics services, for example through port centric distribution activities, as they offer employment opportunities in the study area. Port centric types of services are assumed to prefer locations as close to the port as possible – it is assumed this is primarily focused on 30 miles or less.

Off Port Land Demand and Supply Balance The overall off port land demand and supply balance for 2013, 2018 and 2023 is summarised in the Table ES2 below. On the demand side, land is segmented into open container storage and warehousing and ancillary uses. On the supply side, land is separated into three categories: sites with existing permissions for port-related uses, sites without consents but allocated for B8 uses, and “other” sites without planning status for port-related uses, The “other” sites are a sub-set of a larger potential Greenfield land bank within the 30 mile port centric zone and further consideration may be given to other opportunities if the potential land bank is taken up. For comparison purposes, the table identifies the quantum of existing land supply currently meeting port-related operations for the area within 30 miles of the port. Existing operations beyond 30 miles have not been quantified as the evidence suggests there is less significant impact on meeting land demand from the port from these sites.

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Table ES2: Additional Land Demand and Future Supply: 2013, 2018 & 2023

2013 2018 2023

TOTAL EXISTING IN USE (ha)

Total Existing 156.5 156.5 156.5 Open Storage 49.0 49.0 49.0 Warehousing 107.5 107.5 107.5

DEMAND (ha)

Total Demand (Method 1, Scenario A) 26.7 71.1 114.5 Open Storage 7.3 19.4 31.2 Warehousing 15.9 42.5 68.4 Ancillary 3.5 9.2 14.9

Total Demand (Method 1, Scenario B) 3.7 26.2 43.7 Open Storage 1.0 7.1 11.9 Warehousing 2.2 15.6 26.1 0.5 3.5 5.7

Total Demand (Method 2, Scenario A) 48.6 84.6 116.4 Open Storage 13.2 22.7 31.7 Warehousing 29.0 50.7 69.5 Ancillary 6.3 11.2 15.2

Total Demand (Method 2, Scenario B) 26.7 47.9 63.1 Open Storage 7.3 12.9 17.2 Warehousing 16.0 28.7 37.7 Ancillary 3.5 6.3 8.2

SUPPLY (ha)

Short Term Medium Term Long Term

Total Supply (cumulative) 78.0 240.0 333.0 Planning Consent 10.0 63.0 63.0 Allocated 68.0 139.0 139.0 No Planning Status ---- 38.0 131.0

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Key results The comparison of additional demand and future allocated and potential supply highlights some important overall conclusions: ƒ Based on container traffic scenarios, container volumes are expected to increase by between 12-25% in the period from 2006 to 2013 and between 32- 68% in the period from 2006 to 2023. This produces an additional demand for land of between 4- 49 ha by 2013 and between 44 - 116 ha by 2023. The delayed competing capacity scenario would have the impact of increasing demand in the years 2010-2012. The overall demand forecast is cautious and the risk of underestimating the demand for land is deemed to be low. Caution here makes sense given the goal of long term port competitiveness and supporting value added activities in the study area. ƒ The summary comparison of demand and supply indicates that the total available land supply (with a planning consent or allocation for B8 uses) is 202ha. This exceeds increases in demand under any scenario and should be equated with what will be on the market at any given time. This supply rises to 333 ha if all sites, including those without planning status, are put into the total. ƒ The demand and supply balance indicates that if all the short-listed sites were developed there would be more than enough land to meet demand in the short, medium and long term. These results need to be considered in the context of the market and planning realities. The number of sites is small and even smaller when considering how they come onto the market over the timeframe examined in the study (for example there are only two sites that are identified as developable in the short term). Some of these sites will likely not be developed for port-related uses for a number of reasons:

− A number of the sites have been marketed for these uses for some time without any take up.

− Some of the allocated sites may be developed for other employment uses.

− Unallocated sites may not meet the planning requirements necessary for development. ƒ Therefore, it is a fair assumption that these sites alone may not meet growing demand for off-port land. It is also likely that other sites may come forward that are equally or more suitable for port-related development. These sites should be assessed on their own merits and with reference to the logic and criteria developed as part of this study. ƒ The main issues for identifying future land supply sufficient to meet additional demand will be qualitative rather than quantitative including:

− The need to consider potential sites to provide more comprehensive solutions and provide better size and shape sites;

− The need to consider employment land policies for these sites and see whether they have more potential in other employment uses; and

− To break down the short and long term supply more carefully.

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Next Steps This study should be used as one input to the planning process, as set out in PPS12, but is not likely to be sufficient on its own nor is it intended to replace the consideration of other evidence provided to the LDF processes which will be taken forward by the respective Local Authorities. A second use of this study is to provide one platform to support the sustainable growth of the Port of Felixstowe and the Haven Gateway sub- region. It can assist with guiding wider port planning and be integrated into the HGP activities focused on improving economic performance of the sub-region and developing new value-added related logistics services complementary to the port.

Going forward,and based on the stakeholder consultations and workshops, the following recommendations are made to improve future port and logistics planning in the sub-region: ƒ Plan for growth and allow for new land to be brought into the pipeline if eligibility criteria are satisfied – ensure flexibility and choice; ƒ Ensure that there is sufficient coverage of land in the pipeline versus demand – this can avoid risks of undersupply which may have risks of harming port and logistics performance and thus cause wider economic repercussions; ƒ Provide opportunities for value-added logistics service growth and warehousing proximate to the port – overall it is reasonable to provide relative priority to near port and larger sites; ƒ Encourage and agree on a co-ordinated approach among Local Authorities across the study area to plan for port and related uses, with the HGP one forum through which this can be developed; ƒ It is useful to monitor market changes and adjust plans on a regular basis – simple yearly updates can be complemented by revised forecasts every 2-3 years (this is the process developed in other port areas); ƒ Put in place a mechanism – e.g. HGP as one option – to advance thinking on collaboration and key priorities for the public and private sectors to take forward and implement common user logistics solutions – get scale and efficiency economies and more sustainable solutions acceptable to the wider community.

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1 INTRODUCTION

1.1 Objectives The primary objective of the Felixstowe Port Logistics Study is to identify the key land use issues and requirements likely to emerge from the proposed Felixstowe South Reconfiguration (FSR) in order to inform local and regional decision-making and shape emerging policy documents.

The issues addressed by the study are: ƒ What land is required? An assessment is provided of the land requirements needed to support the sustainable growth and competitiveness of the Port of Felixstowe and related port and logistics uses; ƒ Where and how can the land demands be met? Options are identified for where the required land is favourably located within the planning framework of the port and its environs and areas of influence; ƒ What are the impacts on the transport system and how can they be sustainably managed? The potential impacts of the proposed land uses identified are assessed on the sub-region’s transport infrastructure; and ƒ What do we need to do to get the job done? This report includes a series of recommendations that will form the basis of how to plan and improve the provision of land for port-related used identified in this study.

1.2 Background Suffolk Coastal District is currently preparing a Local Development Framework (LDF) which will establish the spatial planning strategy for the District and thereby shape its growth and development in the years to come. Suffolk Coastal recognises the economic significance of the Port of Felixstowe, not only to the District but to the East of England Region and to the country as a whole. The port is one of the region’s strategic and international gateways, responsible for about 40% of the UK’s container freight traffic. As such, it is a key node of freight activity connected to the country via regional transport corridors and logistics chains. The Port of Felixstowe is a lynchpin of the Haven Gateway Partnership’s efforts to promote the development of the region.

The study is therefore intended to inform the preparation of Development Plan Documents (DPD) produced by local planning authorities within the LDF planning process. As such it is intended to provide part of the evidence base to identify potential sites and support land allocations that would be suitable to support the sustainable expansion of the Port of Felixstowe and related port uses. The study will provide part of two key elements of a sound evidence base for the DPD required by PPS12, namely: ƒ Participation: evidence of the views of the local community and others who have a stake in the future of the area. ƒ Research/ fact finding: evidence that the choices made by the plan are backed up by the background facts.

The Felixstowe South Reconfiguration (FSR) assures the scale of activities at the port will continue to grow. The land use considerations of the growth of the port up to this

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point have generally been limited to on-port operations. In the initial phases of preparing the LDF, the Suffolk Coastal District Council has received strong representation from the main users of the port, primarily the major shipping lines. The key point raised by these port users is that as the on-port operations grow, so will the off-port activities of port-related businesses.

The competiveness of the port will be at least partially determined by the quality and efficiency of the services that support it and complete the chain of freight transport, i.e. shipping, logistics, and haulage activities. The growth of these activities and specifically the land requirement to accommodate this growth must be considered in the development of the LDF, as should their implications for the transportation infrastructure and employment. This study has been commissioned to bring these issues into the LDF process in an informed manner.

Suffolk Coastal District Council has also recognised that port-related land requirements are likely to extend beyond its borders into other local authority areas in the sub-region. It is therefore at the sub-regional scale that the issue needs to be addressed. These neighbouring local authorities, including Ipswich Borough Council, Babergh District Council, Mid Suffolk District Council, St. Edmundsbury Borough Council and Forest Heath District Council, are also in the process of preparing Development Plan Documents (DPD). These local authorities have been involved throughout the study process and it is envisaged that this study will also be considered during their Development Plan Document preparation processes.

1.3 Scope and Method The core task of this study is to assess the land required off-port to accommodate activities supporting the operation of the Port of Felixstowe as a freight and logistics gateway. The scope of the study is defined by the following dimensions:

Port-related activity – The Port of Felixstowe deals primarily with containerised traffic. The port is only one part of a larger system of freight movement that also includes logistics, warehousing, and distribution activities. It is the land required by these uses further along the logistics chain that the study aims to estimate. They include: open container storage, warehouse space, distribution centres, and related ancillary uses.1 The land estimate does not include the quantity of land required for lorry parking.

Geography – As the busiest port in the UK, the expansion of Felixstowe has implications for the movement and distribution of goods throughout the country. Much of the freight volume that passes through the port goes from on-port storage to the Midlands (or the “golden triangle”) and beyond by rail or HGV. However, the purpose of the study is to assist Local Authorities in greater proximity to the port to make informed planning decisions as regards to port-related uses. For that reason, the study focuses its attention on potential sites close to the port, primarily within Haven Gateway and the rest of Suffolk. Larger sites are also included from further afield, such as in Peterborough, in order to consider these locations for intermodal activity.

Time span – The study projects land requirements over the short, medium and long term. Additional land requirements are tied to projections of growing volumes of container traffic at the Port of Felixstowe, year on year from the present to 2023.

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Transportation – The capacity of transportation infrastructure is a major factor in determining how freight is moved in and out of the region from the port. The study therefore considers how transportation infrastructure capacities may affect the location of port-related activities. The implications of the modal split between road and rail are key issues. The target rail share is taken as that provided for in the FSR process.

Within these parameters, the method used to determine land requirements follows a simple logic which is reflected in the organisation of this report. The key components are:

Understanding the strategic context

The UK port sector will see significant change over the next five to ten years, influenced by domestic and international competition, and the changing nature of the international economy and global logistics chains. This report explores how trends in shipping and ports, and logistics and the movement of freight within the UK potentially impact on the operations of the Port of Felixstowe and its port-related activities. This context provides the basis for identifying the drivers behind the evolving requirements for land in the short, medium and long term.

For purposes of this research, the DfT forecasts are considered to provide a reasonable foundation for defining the overall scale of the UK port market and for assessing Felixstowe’s prospects within it.2 GHK confirmed the validity of these forecasts and their basis for national port policy planning with the Department for Transport.

Determining the demand for land

FSR increases the capacity at the port. The growing volume enabled by this increased capacity is the point of departure for determining the requirement for additional land. Traffic forecasts provide two main scenarios for the increase in volumes – the focus is on planning for success and ensuring the port’s competitiveness is safeguarded. It is recognised that there are uncertainties related to both short term demand fluctuations and the timing and phasing of port capacity enhancements and thus we discuss the implications of delays in new capacity coming on stream and / or slow build up of traffic at the new ports planned at London Gateway and Teesport.

The forecast volumes under the two main scenarios are then translated into demand for off-port operations (as distinct from that of on-port operations) using two methodologies. The off-port requirements are segmented by how cargo is handled – from container storage (laden/empty) to logistics services (unstuffing/warehousing/ supply chain management). Search criteria are developed to set the standards for determining the appropriateness of sites in the study area for port-related uses. Lorry parking is not the focus of this study and is understood to be considered under another assessment undertaken by Suffolk County.

1 A full description of the uses that are incorporated under the term “ancillary uses” is addressed in Annex D. 2 MDS Transmodal, Update of UK Port Demand Forecasts to 2030 & Economic Value of Transhipment Study Final Report, July 2007.

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Assessing the supply of land

In reviewing the supply side, consideration of regional and local planning policies and frameworks was undertaken to get a sense of policy direction. Site selection criteria were prepared to match port and logistics requirements as well as to assess the fit with local planning requirements. In addition, broader economic development and employment considerations were also taken into account – especially around the potential demand for port-centric related logistics uses where employment opportunities are likely to be superior to pure container storage. Indeed, the study should help local authorities consider how best to foster greater value-added opportunities related to port activities in the study area.

1.3.1 Data sources Due to commercial sensitivity, complete information was at times not available. In all cases, the best available data was used.

The data requirements of the study have been met through a number of research approaches. A public document review formed a base from which to work and included national, regional and local planning documents, previous development proposals, public sector studies and trade sources. This information was supplemented through interviews with stakeholders: the Port of Felixstowe, shipping lines, logistics companies, hauliers, warehousing and distribution centre operators, local authorities, and other public sector organisations, such as EEDA. A complete list of the interviews conducted to support the work of this study is included at Annex A.

Finally, a workshop was held, 8 September 2008, where the overall approach and principal assumptions and findings of the study were discussed with stakeholders and other interested parties – see Annex B for the workshop format and participants list.

1.4 Report Structure The report is divided into the following sections: ƒ Section 2 – The UK Container Port Market ƒ Section 3 – Port Logistics in Transitions ƒ Section 4 – Felixstowe Port Traffic Forecasts ƒ Section 5 – Land Implications of Port Growth and Logistics ƒ Section 6 – Supply of Land ƒ Section 7 – Off-port Land Demand and Supply

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2 THE UK CONTAINER PORT MARKET

2.1 National Container Traffic The UK ports handled 4.9 million containers, equivalent to approximately 8 million TEU3 in 2006. Growth expressed in TEU terms was 7.2% per year over the period 1997 – 2001 and 3.4% per year over the period 2001-6; below growth levels at North West European ports.4

The principal reason for UK container traffic growth being low when compared with European and world growth rates is the loss of transhipment traffic.5 Transhipment’s share of the UK’s national port traffic fell from 27% in 1997 to only 6% in 2005 – Table 2.1. In contrast transhipment accounts for about 25% of total volumes at Rotterdam and 40% at Hamburg.

Table 2.1 Transhipment as a % of National Container Traffic 1995-2005

Year 1995 1997 1999 2000 2001 2002 2003 2004 2005 Transhipment 24% 27% 22% 20% 17% 14% 9% 7% 6%

Source: DfT/MDS Transmodal

The main reason for the loss of transhipment at UK ports has been a shortage of effective terminal capacity which has resulted in:

− shipping lines being reluctant to use UK ports for transhipment as a result of congestion and delays due to high berth occupancies;

− the port operators’ being less likely to set attractive tariffs for transhipment where there is no surplus capacity; and

− a double numerical impact on volume data when compared with national traffic, as transhipment is recorded as two moves in port statistics.

While shortage of capacity is an immediate and important factor in explaining the transhipment market shift, the loss of transhipment dates back to the late 1990s when there was surplus capacity. This suggests that some of the loss of transhipment traffic is attributable to the relatively lower efficiencies of the UK’s container ports than to congestion – an observation supported by interviews with shipping lines. The factors underpinning the lower efficiencies are multiple, some of which are not controllable while others relate to operational practices of the terminals.

3 TEU is the abbreviation for twenty-foot equivalent units – a standardised measure of container traffic. 4 Over the period 2001-2006 the average growth rates were 9% at Rotterdam, 14% at Hamburg, 11% at Antwerp and 9% at Bremerhaven. World container growth rates averaged 9-10% p.a. over the same period. 5 Transhipment is the movement of containerized cargo from an intermediate destination to its final destination by sea.

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Going forward, the Felixstowe South Reconfiguration provides a solid foundation for the port to ameliorate capacity concerns and improve operational performance.

Growth Drivers Importantly, adjusting for loss of transhipment and stripping out short sea traffic reveals slightly improved growth rates for deep sea traffic – with growth about 6.4% over the period 2000-2005 – this is a core market for Felixstowe. Container traffic growth is driven by in-bound trades, especially from the Far East, serving domestic consumption. The growth of GB container traffic, excluding transhipment, has been similar to that of imports (in value) in recent years. The ratio of container traffic to imports in terms of value is around 1:1.6 The UK ratio reflects the fact that the rate at which imports replace local goods is now tailing off as import penetration is maturing along with consumption growth.

2.2 Felixstowe: The Leading National Gateway Port The shares of GB container traffic held by the main ports in 2006 are given in Tables 2.2a and b. The South of England handles about 75 - 80% of the traffic, with Felixstowe dominating at around 40% of the market. Growth at the top deep-sea ports – Felixstowe, Southampton, London and Thamesport – has been low although the story changes somewhat depending on the metric used (units versus TEU with the latter showing relatively better performance as the TEU / unit ratio increases). They are losing two elements of traffic:

− Transhipment; and

− Market share to the short sea ports on the east coast, which are now receiving containers which used to go to the major ports but are now being transhipped via north west European ports.

The growth rates of the three east coast short sea ports have been high, at 9 to 34%, and averaging 15% p.a, over the period 2001-2006; however this is from low volume bases. Overall, the change in shares and comparative growth rates of main North West European ports suggests greater competition for Felixstowe. Responding to this new competitive environment is a core challenge that this study is seeking to assist with.

6 This ratio is low by international standards. Worldwide GDP growth has averaged 3-4% p.a., international trade growth gas averaged 6-7% p.a and container traffic growth has averaged 9-10% p.a. over extended periods. On the other hand, international trade volumes are probably slightly lower than international trade values as the values include price inflation.

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Table 2.2a Trends in GB Container Traffic* from DfT Maritime Statistics

000 TEU 2001 2002 2003 2004 2005 2006 AAGR Felixstowe 2,839 2,864 2,482 2,717 2,760 3,030 1% Southampton 1,170 1,275 1,374 1,446 1,382 1,500 5% London 752 873 911 979 735 743 0% Liverpool 512 487 566 603 612 613 4% Thamesport 493 530 518 632 797 605 4% Forth 154 176 187 215 230 245 10% Grimsby & Immingham 69 180 125 137 151 137 15% Tees and Hartlepool 79 125 133 133 138 133 11% Bristol 84 95 100 111 115 96 3% Goole 128 92 28 45 119 82 -9% Greenock 55 59 79 63 64 65 3% Others 435 248 571 663 397 489 2% TOTAL 6,770 7,004 7,074 7,744 7,500 7,738 2.7% Note: * Average annual growth rate (AAGR).

Table 2.2b Trends in Ports’ Shares of GB Container Traffic (%)

%TEU 2001 2002 2003 2004 2005 2006 AAGR 2001-6 Felixstowe 41.9% 40.9% 35.1% 35.1% 36.8% 39.2% -1.4% Southampton 17.3% 18.2% 19.4% 18.7% 18.4% 19.4% 2.3% London 11.1% 12.5% 12.9% 12.6% 9.8% 9.6% -2.9% Liverpool 7.6% 7.0% 8.0% 7.8% 8.2% 7.9% 0.9% Thamesport 7.3% 7.6% 7.3% 8.2% 10.6% 7.8% 1.4% Forth 2.3% 2.5% 2.6% 2.8% 3.1% 3.2% 6.8% Grimsby and Immingham 1.0% 2.6% 1.8% 1.8% 2.0% 1.8% 11.7% Tees and Hartlepool 1.2% 1.8% 1.9% 1.7% 1.8% 1.7% 8.1% Bristol 1.2% 1.4% 1.4% 1.4% 1.5% 1.2% 0.0% Goole 1.9% 1.3% 0.4% 0.6% 1.6% 1.1% -10.9% Greenock 0.8% 0.8% 1.1% 0.8% 0.9% 0.8% 0.7% Others 6.4% 3.5% 8.1% 8.6% 5.3% 6.3% -0.3% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 0.0% Source: DfT Maritime Statistics

2.3 Container Growth Forecasts The DfT forecasts for GB container traffic over the next 25 years are summarised in Table 2.3. Growth rates of just under 7% p.a. over the period 2005-2010, falling to just under 4% p.a. in the period 2010-2015, are forecast. The traffic forecast for 2005-2010 is reasonably in line with the recent underlying growth rate of 6% p.a. in TEU shown above although the later growth rates of 4% and 3% p.a. are low relative to world and European growth rates over the last 20 years. Growth rates would be higher if the ports were able to recover transhipment traffic. In terms of preparing forecasts for this study a few points to note are: ƒ DfT 2007 TEU figures are not yet available however preliminary figures suggest favourable growth in 2006. ƒ The forecast baseline for this study was derived from DfT/MDS Transmodal (“update”) – the 2005 TEU value was 7.213mn TEU. For the years post 2005, the values for 2006, 2007, 2008 and 2009 were interpolated using the average annual growth rate in the forecasts over the period 2005-10. ƒ Interpreting port statistical data is subject to some variation however the values used in this study are based on the latest data. The DfT forecasts are designed

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for long term port policy development and planning. Demand conditions are however subject to variation owing to economic cycles.

Table 2.3 Forecasts of GB External Container Traffic, 2005-2030

( in 000s) 2005 2010 2015 2020 2025 2030 Growth Growth 2005-2020 2005-2030 Total In TEU 7,213 10,009 12,146 14,147 16,633 19,728 Growth 6.8% 3.9% 3.1% 3.3% 3.5% 4.6% 4.1% Excl. 7,003 10,009 12,146 14,167 16,633 19,728 transhipment Growth 7.4% 3.9% 3.1% 3.3% 3.5% 4.8% 4.2%

Deep sea only 5,722 7,833 9,579 11,196 13,316 16,029 Growth 6.5% 4.1% 3.2% 3.5% 3.8% 4.6% 4.2%

Source: DfT Maritime Statistics and MDS Transmodal Forecasts

2.4 Supply and Competition Over the planning period of this assessment the UK port supply position is expected to change substantially – new terminal capacity is planned to come on stream. Table 2.4 provides a summary of planned expansions of container ports.7 The direction of future supply is reasonably clear – new capacity is highly likely to be on stream but timing remains subject to some uncertainty. Equally, port performance is also somewhat uncertain – Annex C provides a scenario on potential supply entry and allows for productivity per metre of quay to improve over the planning period. It is prudent to assume a degree of elasticity when considering port capacity. The working assumptions on port capacities are based on: ƒ the quay lengths at each of the ports and likely expansion – this is a proxy for capacity and is supported by evidence as being reasonable; ƒ productivity of 1,110 TEU per metre of quay per year as a base line;8 and ƒ productivity variations across ports owing to market and operational factors and improvements over time.

It is anticipated that the demand and supply balance will remain tight over the next 5 years and then loosen over next the 5 to 10 years assuming new capacity comes on stream as planned. If Felixstowe brings the FSR Phase 1 on stream as planned and

7 There is some variation in estimates of timing of new quay as well as potential capacity based on operational assumptions of TEU / metre of quay / year. There is considerable variation in claims versus historical performance – note Southampton’s claim to improve well beyond current revealed performance. In other case, productivity movements can go up as well as down – Thamesport is an illustration as traffic volumes varied considerably over a similar quay – see Table 2.2. 8 The estimate of productivity per metre of quay per year of 1,110 TEU is used in the most up to date planning document on the Department for Transport (DfT) Website – the "Update of UK Port Demand Forecasts to 2030". It is emphasised that this estimate of capacity is well below that achieved at the most efficient ports in other countries and thus there is reasonable grounds to expect some improvement over time. If UK ports could reach the levels of efficiency usually required by international terminal operations in other countries (1,500-2,000 TEU is often used for port planning purposes) the national capacity would be much higher than shown in the table above.

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there is slippage in the delivery of new quay at London Gateway and Teesport then demand for off-port land could be greater in the short run. This contingency is considered in the following sections. The upshot: it is important that Felixstowe’s growth and competitiveness is supported now as the competitive balance shifts with more port choices and new operational and commercial challenges.

Table 2.4 Planned Expansions of Container Terminals: A Question of Timing

Extra Port Operator Comment Capacity Felixstowe South HPH 1.5m TEU Phase 1 on stream Q4 2010 – 1 m TEU Phase 2 on stream 2013/4 - .5 m TEU London Gateway DPW 3.5m TEU Operational 2011 – Phased build up Liverpool Peel 0.6m TEU Approved 03/2007, timing tbc Northern Gateway PD Ports 1.1m TEU HRO Approved 02/08. Timing assumed at 2011 Bathside Bay HPH 1.7m TEU Beyond 2015 Southampton DPW/ABP 2.0m TEU In progress potential capacity to 3.5m TEU Bristol BPC 1.0m TEU Early stage concept – assumed post 2013

Source: Trade sources, Interviews

2.5 UK Ports: Pressures for Change There are several trends which will influence the overall UK as well as Felixstowe’s share of national container traffic over the next five to ten years. Key factors shaping future port traffic shares are outlined below.

Vessel Size Growth There will be a shift to much larger (10-12,000 TEU) container ships over the next three to five years. The first of these ships, with a capacity about 50% higher than the previous largest ships, was launched only 20 months ago, but there are now a significant number on the order book - Figure 2.1.

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Figure 2.1 Going for Scale: Future Container Vessel Order Book (Q1 2008)

2,000,000 No of vessels 1,800,000 404 No of vessels 187 No of vessels 1,600,000 125

1,400,000

1,200,000 No of vessels 737 TEU) 1,000,000 tal ( tal

To 800,000 No of vessels 93 600,000 400,000

200,000

0 < 3,000 3,000 - 6,000 6,000 - 8,000 8,000 - 11,000 > 11,000 Vessel Size (TEU)

T The deployment of very large vessels is expected to reshape port calls although there is debate on how the new market will look. One scenario could result in fewer direct calls at UK ports, because these big ships will prefer to call only at ports with (i) the largest volumes and (ii) very high handling speeds (turnaround time is crucial for these ships). They will also wish to minimise the number of port calls to avoid multiple port dues, which are charged per gross tonnage of the ship. Although the Mega ships may increasingly bypass UK ports, this will not entail a drastic decline in traffic but will in part result in a shift between deep sea and short sea markets. First, the major lines will probably run some strings into UK, because if they do not offer direct calls they will lose market share to those lines that do – as fast transit times are important for many goods, for example clothing and textiles, electronics, and other fast moving consumer goods. Such services could be in the 6-8,000 TEU ships which will also be deployed. Secondly, the containers (excluding transhipment containers) will come to the UK anyway, albeit in smaller/ feeder ships.

Market Volume Shifts The main UK ports’ share of the North West European market, currently about 15-20%, is falling. The container traffic at Rotterdam, Antwerp, Hamburg and Bremerhaven is increasing at about 10% p.a, while that at Felixstowe, Southampton and London is increasing at about 2-3% p.a. This is contributing to making UK calls less attractive to shipping lines, owing to reduced connections and cargo mass (the possibility of larger box exchange per port call). The disparity in growth rates, however, should level off eventually, as GDP growth in North West Europe is likely to remain similar to UK GDP growth. North West European port growth rates appear to have been kept high by (i) taking a larger share of the markets to the south from the Mediterranean ports and (ii) handling increasing transhipment to Russia. The overall European container port position is summarised in Table 2.5.

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Concessions and Ownership North West European port authorities are allowing an increasing number of dedicated shipping line terminals, run by companies such as Maersk/APMT and MSC. These dedicated terminals are more likely to be used as hubs than UK ports which are run by International Terminal Operators (ITOs).

Performance A key competitive factor is relative port handling speeds. From the interview evidence, it is understood that at UK ports, including Felixstowe, handling speeds are a concern of the leading shipping lines and this is creating uncertainties about the future role of UK ports in serving the large vessels coming on stream. Thus, a major challenge for Felixstowe is to improve crane productivity – with the key metric for customer service being crane moves per ship hour at berth – as part of the overall port investment plan. While this is a critical issue it is outside the remit of this study except to the extent that faster handling speeds need to be complemented by overall efficiency improvements in the container yard (CY) and, in part related to this, the supply of sufficient off-port land to service growth.

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Table 2.5 European Container Port Profile 1996 – 2006

TEU MN 1996 2001 2006 Growth (% p.a.) NORTHERN EUROPE 1996-2006 Rotterdam 4.97 6.10 9.60 7% Hamburg 3.05 4.67 8.86 11% Antwerp 2.64 4.21 7.01 10% Bremerhaven 1.53 2.93 4.45 11% Le Havre 1.02 1.52 2.13 8% Zeebrugge 0.33 0.32 1.64 17% Felixstowe 2.06 2.73 3.00 4% Southampton 0.81 1.16 1.50 6% Sub Total 16.41 23.64 38.19 9% Mediterranean, excluding Mainly Transhipment Port (see below) IT ALY Genoa 0.83 1.53 1.42 6% La Spezia 0.87 0.97 1.13 3% Trieste 0.17 0.20 0.22 3% FRANCE Marseilles 0.55 0.74 0.94 6% SPAIN Valencia 0.71 1.51 2.61 14% Barcelona 0.77 1.41 2.30 12% PORTUGAL Lisbon 0.31 0.44 0.51 5% Leixoes 0.20 0.30 0.38 7% Sinoes 0.00 0.00 0.12 Piraeus 0.58 1.17 1.20 8% Thessaloniki 0.16 0.23 0.37 9% Sub Total 5.15 8.49 11.20 8%

Mediterranean Mainly Transhipment Malta 0.66 1.17 1.49 8% Algeciras 1.31 2.15 3.24 9% Gioia Tauro 0.57 2.49 2.94 18% Taranto 0.00 0.00 0.89 Sub Total 2.54 5.80 8.56 13% BALTIC 2005 (Drewry) Gdansk 0.00 0.00 0.07 Klaipeda 0.04 0.05 0.21 21% Tallinn 0.05 0.08 0.13 12% Riga 0.14 0.10 0.12 -2% Sub Total 0.23 0.23 0.53 10% BLACK SEA Constantza 0.09 1.30 35% Varna 0.03 Bourgas 0.02 Sub Total 0.14 1.30

TOTAL 24.46 38.17 59.78 10%

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3 PORT – LOGISTICS IN TRANSITION

3.1 Golden Triangle vs Port Centric Models Container ports are part of more extended supply chains, often beginning in factories in the Pearl and Yangze River deltas in China through to distribution centres and retail stores in the UK. There are a number of factors shaping logistics chains and how ports fit within them. Perhaps the most significant pressure for change is that transportation costs are expected to increase as a share of the logistics value chain as a result of rising energy costs. More attention is being paid to managing transport costs – from slower steaming speeds at sea to minimising moves and distances travelled. Strengthening these pressures for change, and very much complementing them, is the climate change agenda and the greening of supply chains. One focus here is on modal choices. On the one hand, there is a tendency to ensure that modal choices are shifted in favour of rail and water moves in the first instance. In the context of Felixstowe this primarily relates to improving and sustaining the rail share of inland transport and indeed this objective is made explicit in the FSR planning process. In part reflecting these changes, the most significant new flows for intermodal rail freight have been for supermarkets which have started using rail for internal trunk hauls, particularly to and within Scotland.

On the other hand, there is also a drive to reduce road miles of the inland moves. This supply chain driver is forcing beneficial cargo owners9 (BCOs) and their logistics services providers to assess how best to organise port and modal choices along with the location of distribution centres to minimise road moves. This is giving rise to increased attention on port centric logistics whereby import centres (given the in-bound dominance of port traffic in the UK) are located on or very near the port of import. The import centre location is selected where the distribution to inland centres / markets is minimised and equipment can be more efficiently deployed (de-vanning containers at the port reduces the need to transport empty containers long distances back to the port and thereby allows better equipment utilisation). A key to the success of the port centric approach is to ensure good size land areas are available on / contiguous / very near to the port thus minimising shunt costs.10

In partial contrast, the dominant logistics flows are where containers are distributed away from the port to a central or regional distribution centre which is ideally located at an equidistant point from several key consumer markets. This model requires significantly greater transport efficiencies from the port to the distribution centres and is far less reliant upon land next to the port related uses; except where imbalances and/or operational practices create demands for storage of empty containers.

9 Beneficial Cargo Owners refer to the owner of the goods being transported by container, often major retailers and other importers. 10 In the port-centric approach containers are transferred to distribution centres / warehouses or open container storage close enough to the port such that the move of the container from within the port is a very cost effective operation. For example, the cost of a “shunt” of a container from the Port to a container storage facility or warehouse is currently in the range of £25. The upper threshold for this move has been identified at perhaps £50 but the benefits soon drop off – the so-called “killer” shunt move that reduces the attractiveness of the port-centric solution (land and labour costs also affect this calculation).

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Overall, the volume of port centric logistics type of activities is modest relative to the more conventional “golden triangle” distribution approaches where the centre of gravity is oriented towards the Midlands to service UK markets. It is expected that the majority of containers will flow to and from the port to more distant inland destinations, principally outside our planning areas, where the main markets are and can be accessed in a cost-effective manner. Although it is hard to pin down exact values, this is supported by our interviews and available origin / destination evidence.11

However, there are reasonable expectations that port centric solutions can grow – with further developments at Teesport and at the new London Gateway in the pipeline evidence of this approach. In the case of Felixstowe, based on interviews with stakeholders, the marketing of port centric logistics solutions is on the agenda of both Hutchison Ports UK (HPUK) and existing operators and/or developers (e.g. PD Ports and Logistics, BAP, Gazeley).

For planning purposes, it is assumed that provision for port centric logistics growth should be allowed for as part of near port future land uses. Port centric also can support additional employment growth as more value-added is captured in the port vicinity and study area. This is understood to be a desired objective among the client group and among a wider stakeholder group as articulated during the September 2008 workshop.

Operational requirements of current port centric operators There are variations in the types of activities and resultant land use related to port centric operations. Container storage and warehousing operational requirements are identified below to allow for subsequent identification of appropriate sites to meet demand. ƒ Container Storage

− Site size of at least 5ha;

− Located before the Orwell bridge, off the A14 and near the port (laden);12

− Located west of the Orwell bridge or on port (empty);

− Ability to undertake at least 20 shunts per night;

− Cost of shunts to be £50-55 per move – this is a key factor shaping the radius of likely acceptable sites;

− Low rental costs of £100,000 per hectare (empty);

11 Intermodal terminals with integrated distribution centres are seen as a possible logistics change that would facilitate the trend towards increasingly large distribution centres whilst encouraging freight onto rail over shorter haulage distances thus reducing container transportation by road. However, conventional wisdom holds that rail movement of cargo is only suitable for longer distances, as moving containers on and off rail signifies an additional cost. The exact break even distance for shifting cargo to rail is a product of a number of factors, including fuel prices, regulation and the availability of subsidies. In this way, both distance from the port and proximity to markets are both key factors in determining how intermodal terminals can be developed. 12 A discussion of significance of the Orwell Bridge in determining ideal port-centric location is included in Annex D.

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− Direct access to trunk road junctions off the A12 or A14;

− Ability to stack containers 6 high;

− Surrounding areas compatible with 24-hour operations, including noise and lighting impacts; and,

− 10+ year leasehold – this factor will influence willingness to invest in the quality of sites. ƒ Warehousing

− Individual lot size of at least 10 ha, larger lot sizes would be preferable to allow co-location of facilities on the inland ports model;

− Within 30 miles of the port of Felixstowe for port-centric activities – with a relative preference for more proximate sites to keep shunt costs manageable;

− Direct access to trunk road junctions;

− Need for location to address congestion along the A14;

− Need for strategic location to address pinch point of Orwell Bridge;

− Surrounding areas compatible with 24-hour operations, including noise and lighting impacts;

− Due to the scale of investment, freehold or longer leaseholds are preferred;

For both container storage and warehousing operations the land most suitable for requirements is relatively flat and level ground. Significant up front capital investment for land improvements severely reduces the viability of purchasing a leasehold on the sites.

3.1.1 Current factors shaping off-port land use Interview feedback and analysis of the ports operations indicate that a substantial share of current off-port land requirements is being driven by the inability to export empty containers. The primary area for container storage and warehousing adjacent to the port exists within the Trinity Estate utilising the benefits of a private road network and “portside” highway regulations which allow for direct movement of containers via internal movement vehicles (IMV). In terms of sites, there is a high degree of sensitivity to duration of leases (and thus willingness to invest) and rentals – with the empty container storage the most sensitive to this as this activity is a poor revenue generator.

Empty container storage demand The demand and growth of container storage facilities around the port of Felixstowe is evidenced by the preparation of numerous sites along Nicholas Road for future container storage and consolidation of existing facilities such as those by Pentalver. The proportion of open container storage required adjacent to the port is driven by the cost of on-port storage and the dwell times of containers before being transported to their destinations in containers or by pallets.

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Over the planning period, it is assumed that the balance of laden and empty containers is stable. The basis of this assumption is that the major changes in the production and distribution of goods has occurred – recall in section 2 it was noted that the ratio of container traffic to imports in terms of value is around 1:1 suggesting that the rate at which imports replaces local goods is now tailing off as import penetration is maturing along with consumption growth.

3.2 Inland Connectivity and Infrastructure: Making the Links The container terminal at the port provides the physical link between ocean and land modes of transport and is a facility providing a series of services to handle and control container flows from vessel to railroad, road and vice versa. The connectivity of the port is largely assessed in terms of the ability to provide sufficient capacity for the volume of outbound and inbound laden and empty containers to be efficiently transported via the road and rail networks to the end retail chain and customer. Particularly important is to ensure that the system continues to remain as free flowing as possible; the velocity of movements over the quay, through the container yard (CY) and the gate is a critical factor in determining productivity of the port and thus land requirements. For example, where CY capacity is constrained and/or velocity of stack turns is reduced (e.g. for commercial reasons) then sufficient low cost access to larger amounts of land which is close to the port to allow for both short-term storage facilities and longer term storage for goods with dwell times in excess of 60 plus days is needed – there are both supply issues (secure chains with buffer stocks vs. lean just-in-time systems) and seasonal variations (e.g. such as before Christmas and prior to Summer periods).

There is an import and export of containers that needs to be balanced – the unloading of full containers from vessels at the port works hand in hand with the loading of laden and importantly empty containers bound for manufacturing regions in Asia. This balance is in part driven by the handling speeds at the port and ship hold capacities whereby faster handling speeds allow for a greater total transfer of containers both off and onto the vessel if sufficient room is available in the hold. It is understood there are issues at Felixstowe on getting this balance right and a work-around solution has been put in place.13 The port of Ipswich is already benefiting from the pressure to export containers, and is exporting 180,00014 TEU per annum via feeder ships based on a 10 ha container storage yard.

Infrastructure improvements, road and rail, are required to ensure ports remain competitive and maintain good levels of connectivity to their customers – inland connectivity is a key success factor in port competitiveness. The significant investments proposed for the A12, A14 and rail networks drive the ability of the port to remain competitive and increase the throughput of containers to and from the port. The balance of this section describes the current position of rail- and road-related services supporting Felixstowe.

13 In this respect, a clear demand for additional capacity to export empty containers has been supplied by the nearby Port of Ipswich which currently provides 3 feeder ships each transporting 170 TEU’s per day to the European port of Zeebrugge. The Port of Ipswich is currently able to store approximately 3,500 TEU for export via these feeder ships. 14 Figure based on daily Ipswich to Zeebrugge handling by 3 feeder ships each with 170TEU capacity.

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3.2.1 Modal Splits: Road is Dominant – Rail is a Priority The modal split for container transportation is heavily weighted towards road networks. The dominance of road transport is based on greater capacity, flexibility of routes, and overall lower investment in infrastructure/capital and cost effectiveness where distances are shorter or cargo densities lower when compared with rail options. For container transportation, rail has to offset the cost of the additional double ‘lift’ to transfer containers to and from road trailers at the start and end of the rail leg and a local road haulage leg to and from the destination terminal. A further factor is the weekly cycles and seasonal fluctuations in demand. As rail services are scheduled to provide a consistent capacity throughout the year, the availability of capacity cannot be altered to meet these fluctuations. This makes it more difficult to fill the available capacity of daily train services throughout these variations which in consequence reduces utilization and cost efficiency.

Historically the ‘break even’ haulage distance for containers by rail in the UK was 250 miles, which from Felixstowe meant Leeds and Manchester. However in recent years the ‘break even’ distance has reduced and rail freight services between Birmingham and other West Midlands terminals and Felixstowe are now in demand. Increasing road congestion and fuel costs will work to further reduce this break even distance.15 In practice rail share of container movements less than 125 miles is very low and is virtually nil less than 100 miles. Thus, the prospects for intermodal facilities, that receive containers from the port by rail and move them onto road to complete their journey, in the core study area are negligible at this time.

Rail: Planning for Growth In 2005 a rail modal share of 28% was achieved by Southampton (Freight RUS). Increasing fuel costs and road congestion are likely to favour rail going forward. This suggests that the maximum 30% modal share considered as part of FSR could be reached and exceeded if rail capacity were available.

At the FSR Inquiry, the modal share of hinterland containers carried by rail was assumed to vary from 18.5% in 2007 to 26% in 2023. Two alternative shares were also considered of a flat 25 % and 30%, the latter representing the maximum modal share thought possible for rail. In practice the modal share has climbed from 18.5% in 1996 to 23% in 2006 (Source SCG13 and Freight RUS). The resulting forecast rail volumes are included in Annex C.

3.3 Rail: The capacity challenge The market for and use made of rail has been increasing in freight sectors; a pressure gaining in importance. Many parts of the network are effectively nearing capacity as it becomes increasingly difficult to timetable or path new services through a series of pinch points. Attention has therefore turned from rationalisation to match demand and

15 For example, congestion has reduced the average distance travelled per hour and per day by HGV. In terms of magnitude of scale, the road haulage distances for individual HGVs achieved 10 years ago have been halved in recent years due to congestion.

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reduce costs to increasing the use that can be made of existing capacity by train lengthening, timetabling and a limited number of enhancements at key locations.16

Key factors shaping rail freight capacity include: ƒ Competition from passenger services (with differential service and operational requirements (e.g. speeds, seasonality, schedules)) and paths lost to other services such as Crossrail on the southern part of the Great Eastern Main Line (GEML); ƒ The proportion of 9’ 6” containers is increasing – this is driving the provision of W10 gauge clearance on selected routes which allow the taller containers to be carried on standard height wagons.

What are the implications for rail capacity at Felixstowe? The rail routes and destinations from Felixstowe are shown in Figure 3.1.

Figure 3.1 Felixstowe Rail Connectivity

Most container trains moving to and from Felixstowe run via the sidings at Ipswich which are used to regulate trains when paths on the GEML and Felixstowe branch do not coincide and this also applies to the reversal of all trains using the cross country route. Train lengths to and from Felixstowe will therefore tend to be limited to the equivalent of 24 wagons due to the lengths of the existing terminals at both Felixstowe,

16 The nature of the rail network is that the enhancements do not necessarily need to be at the pinch points but can improve capacity by, for instance, regulating the flow of trains so that better use is made of the existing capacity at pinch points.

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and at destination terminals but also in particular by the available length of sidings at Ipswich. From Ipswich two routes can be taken: ƒ The Great Eastern Main Line (GEML) Route: This takes the Great Eastern Main Line south and then the North London Line to reach London and the bottom of the West Coast Main Line. This route gives access to London and Cardiff and to all the destinations that are reached from the West Coast Main Line including the Midlands terminals, Liverpool, Manchester and Glasgow; ƒ The Cross Country Route: This takes the Great Eastern Main Line north, requiring trains to reverse direction at Ipswich, and then the Cross Country route via Ely to Peterborough. From Peterborough trains can join the East Coast Main Line to reach terminals in Yorkshire and in Teeside.

The capacity of the rail network to and from Felixstowe will be increased from the current 26 trains per day each way by increasing the number of paths per day by 14 to 40 each way per day on the Felixstowe branch line. Other enhancements to routes beyond Ipswich are designed to allow these paths to be utilized or provide alternative capacity on the Cross Country route via Peterborough should the number of paths currently available via London be reduced by other demands. Setting aside commercial factors, there would therefore appear to be only limited and medium term scope following completion of the branch line enhancements for additional rail freight services and in particular those shuttling between the port and local intermodal terminals as they would absorb capacity on the branch line displacing future longer distance services.

Intermodal Options: Are they viable in the study are? As part of this study, potential sites for container handling, storage and warehousing have been identified locally adjacent to the port within 30 miles of the port and more distant (in the east of England and beyond). In the evaluation of these sites the potential for an intermodal capability is to be assessed. The assessment approach takes into consideration rail capacity (is there capacity available to accommodate additional rail services beyond FSR requirements), the likely commercial factors driving modal choice (is there a market given modal choice economics) and the suitability of sites to accommodate an intermodal operation.

Sites Adjacent to the Port There is likely to be more than sufficient rail terminal capacity within the port and thus unlikely to be demand for another terminal at sites adjacent to the port.

Satellite Sites within the Port Centric Zone Satellites sites not immediately adjacent to the port but within the 30-mile port-centric zone hold some potential for intermodal facilities. Satellite intermodal terminals could facilitate additional long haul freight trains to and from the area with transfer by road to the port, without further enhancement to the branch line, provided paths were made available on the Cross Country route. Operators have also been looking at sites west of the Orwell Bridge as this would de-couple the road trunk haul from the congestion pinch points at Copdock and the Orwell Bridge which could be more efficiently negotiated by road based ‘shunt’ moves at off peak times. The disadvantage would be fragmentation of rail volumes to and from destination terminals between the rail terminals at Felixstowe and the satellite terminal. A satellite site is also likely to be

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dedicated to a single shipper or haulier which would fragment volumes further. However certain shippers such as MSC already have their own dedicated trains operating from Felixstowe which suggests sufficient volumes could be available at such a satellite terminal to warrant trunk haul by rail on certain routes. The financial viability of this approach would be determined by the cost of shunting containers between the port and the intermodal terminal, and the additional handling costs they imply (consideration of the cost of shunts in defining the viable range of the port centric zone is discussed in Annex D).

Distant Sites The marketability of an intermodal terminal at a distant site will generally depend on the breakeven point for rail in terms of the haul distance. As the more distant sites within the study area are generally closer to the Port than the current destination terminals served by rail from Felixstowe, the financial advantage, if any, of using rail to these sites is likely to be marginal.

The viability of an intermodal terminal on a distant site will therefore depend on a range of factors being met, some basic considerations are: ƒ A rail connection should not be costly, sites adjacent to railways or with an existing connection are therefore better, new longer and more costly spurs to provide the connection will be a great disincentive; ƒ The site or nearby sidings should be able to receive and dispatch 750m long trains;17 ƒ If the terminal were integrated with large scale distribution centres that would warrant trainload freight this would remove one road haulage link improving rail’s competitive position – cargo density/mass is a key factor; ƒ Integrated distribution centres would need to be large enough to support several train loads per day from Felixstowe or perhaps a mixture of sites. Sites of 50 ha have been promulgated. A site this size could be expected to generate several train movements a day, not necessarily all from Felixstowe, which would help to defray costs; ƒ The site should be accessed from a route with W10 gauge clearance which further improves economics; and ƒ Rail routing should be direct and not involve numerous reversals or lengthy detours.

However, to consider the possibilities in the current context, the revealed market behaviour is telling: there is very low rail share for distances less than 125 miles. As dramatic changes in cost structure and time preferences occur, the issue of intermodal could be reconsidered.

17 In this respect the preference is for siding capacity parallel to the existing rail lines with minimal curvature on the main rail line.

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Summary Intermodal interchange options within the study area – be they proximate to the port or more distance towards the perimeter of the study area – are likely to be of limited viability at this stage owing to the following factors: ƒ First, the FSR rail assumptions suggest that the planned port rail link should be able to accommodate growth in rail traffic over the planning period – this is a priority and plays to rail strengths of point to point services; ƒ Second, intermediate intermodal interchanges are likely to be uneconomic owing to intermediate moves, extra handlings and distances too short for rail to achieve scale benefits – a prudent planning assumption is that rail does not win market share at less than 125 miles and improves its position as distance increases from that point. ƒ Third, there are few opportunities that are well suited in the area to be operationally superior to alternatives until a point where compelling market factors reshape the economic fundamentals related to road-rail choices.

It is sensible to monitor market changes over the planning period to identify issues and opportunities to improve rail’s modal share – which remains a core transport policy goal – and facilitate appropriate planning and land use to secure efficient sustainable solutions.

3.4 Road: Policy context, modal shift and planning issues An overview of the key issues related to Felixstowe and port-related land uses off-dock are provided below.

National Planning Guidance on Transport (PPG13) recommends locating development sites that generate substantial freight movements such as distribution and warehousing away from congested central and residential areas and to ensure adequate access to the trunk road network. The identified sites in this study will need to be located within areas which will allow for existing road forecast demands and avoid areas of existing heavy congestion, unless mitigation measures can be applied. PPG13 also suggests promoting opportunities for freight generating development to be served by rail or waterways by influencing the location of development and potentially protecting, where appropriate, realistic opportunities for rail (or waterway) connections to manufacturing, distribution and warehousing sites close to the rail network, waterways or coastal/estuarial ports. Government Policy is set out in the circular “Control of Development Affecting Trunk Roads and Agreements with Developers under Section 278 of the Highways Act 1980.”(Circular 4/2001) A section 278 Agreement with the Secretary of State is an agreement that allows a developer to fund highway improvement works in order to accommodate development related traffic.

3.4.1 The Critical Strategic Link: The A14 Trunk Road Traffic Conditions and Strategy The A14 forms a strategic east-west link from the M6/M1 interchange in the south Midlands passing through the central and eastern parts of England to Felixstowe in Suffolk. As the first connecting east-west link from Felixstowe to the National Road network the A14 provides the primary route in and out of the Port, notwithstanding the importance of the A12 Trunk Road to southerly destinations. The A14 connects with the A12 London to Ipswich Trunk Road at the Copdock Interchange. The road is also part of the Trans-European Network (TEN). The A14 is dual-carriageway standard

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along its entire 210 kilometre length and it connects with other major routes primarily via grade-separated (two-level) junctions. The annual average daily two flow of traffic east of Orwell Bridge is in the region of 55,000 vehicles of which some 11,500 are heavy goods vehicles. With average flows on the A12 of over 70,000 vehicles per day the A12 is reaching a stage where a dual three lane motorway design standard is becoming appropriate18. The Highways Agency concludes that the Felixstowe South Reconfiguration development would generate about 3,000 additional two-way movements per day in the design year 2023. Consequently the A14/A154 Candlet Road Roundabout (Dockspur Roundabout) is to be upgraded to accommodate the additional traffic. In addition, the Inspector at the Inquiry also concluded that the A14/A12 Copdock roundabout should be modified to ensure that the traffic generated by the proposed development would not be beyond the capacity of the road network in 2023. Although the A14 is a major trunk road it is still used for short-distance local trips; potentially up to 40% during the peaks in the vicinity of Ipswich and the Highways Agency anticipates that the A14 will be at peak period capacity by 2014; however spare capacity will remain between the peak periods. As with the Felixstowe Dock extension proposals the Highways Agency will require improvements to A14 or A12 junctions that are assessed to be over-capacity because of any new proposals. They will also seek confirmation that new sites have satisfactory accessibility by all modes. In this respect identified sites will need to have high accessibility and mitigation measures will need to match increased loads on the roads with improvements.

The impact of the above requirements by the Highways Agency is such that any new site allocated or used for container storage and warehousing linked to the port will need to be located close to an existing junction on the A14 or A12 Trunk roads and will need to contribute towards the bulk of improvements for localised impacts.

3.4.2 The Highway Authority, Suffolk County Council The local Highway Authority, Suffolk County Council is party to the agreement on highways between the port developer and the Highways Agency, which, as indicated above, states that as long as the agreed improvements are carried out to the Dockspur Roundabout and Copdock Interchange, then the capacity of the A14 between the development site and the Copdock Interchange would be no worse off with the reconfiguration scheme than without it. Because of the shift pattern at the port (7am and 7pm) employee related traffic is largely generated outside of the normal highway peak hours and hence the local Highway Authority do not consider that the impact of employee travel would be unacceptable. The proposed Travel Plan would also contribute to minimizing this impact. The Local Highway Authority has raised concerns about the issue of stacking HGVs on local roads when bad weather conditions lead to the closure of the Port which is being addressed through Operation Stack and conditions of the FSR consent.

3.4.3 Lorry Parking/Operation Stack While lorry parking is not a core issue for this study it is worth summarising at least some of the issues related to this as it is part of the port logistics chain. Suffolk County Council, as local Highway Authority, has recently published a strategy for HGV overnight parking on the A14 and their proposals for ‘Operation Stack’. On the A14 in Suffolk there are three purpose built lorry parks, at Bury St Edmunds (Rougham Hill),

18 A12 and A120 Route Management Strategy, Section 8.5. Highways Agency.

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Nacton (Orwell Crossing) and Risby providing some 150 spaces in total. There are also some transport café style sites close to the trunk road. To establish the capacity requirements and ideal locations where additional lorry parks are required on the A14 in Suffolk, the County Council conducted a survey in 2006. This determined the current parking needs by identifying the volume of HGVs parking in lay-bys, in communities adjacent to the trunk road network, the current level of use of existing lorry parks, and transport cafes on the trunk roads. It found that 482 vehicles park on or alongside the A14, and with an 8% increase year on year this amounts to 563 by the end of 2008. The shortfall on the A14 in Suffolk is therefore over 400 spaces excluding the increase expected on the A14 following the development of Felixstowe port. Lorry parking will the subject of a separate study, the conclusions and land use implications of which should be considered in conjunction with the findings of this study.

Proposals for HGV Parking along A14 Suffolk County Council has advocated to DfT that there should be a series of regular permanent lorry facilities offering overnight parking and rest areas at intervals of around 30 minute spacing. This is a significant issue in terms of preferred size of any new sites. Not only would regular spacing of lorry parks enable drivers to adhere to their driving hours regulations, but it would also enable the construction of lorry parks of a size which would have minimal impact on the surrounding environment. The scope to provide additional permanent lorry park spaces to meet demand is two fold.

Firstly the three current lorry parks each have potential to expand as follows: ƒ Risby a planning application is already being made to increase this site from 35 to 70; ƒ Bury St Edmunds, the site is owned by Suffolk County Council and leased to Highways Agency. There is County Council land alongside which could be developed, expanding the site from 28 to 56; ƒ Nacton (Orwell Crossing) currently has a planning consent for 125, but it is understood that adjacent land owned by the park landowners could be developed to double the capacity of the site.

Collectively this would increase the current capacity of existing sites to around 250 spaces but still leave a potential shortfall of over 300 on the A14.

Secondly, working with District Planning Authorities, Suffolk County Council has suggested a number of potential sites, including those where private developers have expressed an interest, to be identified for consideration as site options within the District Council Local Development Framework documents. There is the potential to incorporate the opportunity for new container storage and warehousing with a potential lorry parking site to ensure these activities are managed together rather than as separate activities.

In terms of providing a permanent solution to Operation Stack, there are clear advantages in terms of constructing a series of lorry parks alongside the A14 which would have the capacity to cater for routine overnight and rest breaks, and Operation Stack. A series of sites available alongside the A14, within Suffolk would offer a more environmentally acceptable option than one large site, and address traffic congestion issues at and east of A14/A12 Seven Hills interchange. In addition these sites should

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be linked or located at the proposed container storage and warehousing facilities to ensure the efficient use of land and overall aim to reduce greater impact on the roads.

3.4.4 Road issues and off-port land selection criteria New sites proposed for container storage and warehousing will ideally be located so as to address existing road congestion areas. In respect of the road appraisal the indications are that potential container storage and warehousing sites with lorry parking facilities therefore should be located as follows: ƒ Within the existing port internal road system given the capacity of the network. ƒ Within 5 miles of the port given the existing capacity of the road network and as a staging post before crossing the Orwell Bridge. ƒ West of the Orwell Bridge but within 30 miles of the port so as to provide a staging post prior to crossing the Orwell Bridge.

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4 FELIXSTOWE: PORT TRAFFIC FORECASTS

4.1 Forecast of Felixstowe’s Container Traffic The first step in estimating the demand for land off-port is to estimate the potential volume of cargo (containers) that the port of Felixstowe is likely to handle. Container traffic estimates are based on the accepted national DfT forecasts as noted in previous sections, with the Felixstowe share based on a number of assumptions related to performance and changing market dynamics outlined in the previous sections.

Two traffic scenarios have been considered – Table 4.1: ƒ Scenario A Planning for Success – Felixstowe retains its existing share of the market going forward over the planning period. ƒ Scenario B Business as Usual: Felixstowe loses its share of the market at the same rate as over the last five years.

Given the strategic focus on improving Felixstowe’s overall competitiveness the recommended approach is to plan for success. As a supplement to Scenario A, in Scenario Aii the analysis also tests the potential implications of slightly higher growth owing to Felixstowe retaining market as a result of delayed delivery and traffic build up of new port facilities – this provides a just in case test as seen from the planning perspective.

The baseline positions and determination of 2006-9 GB volumes were discussed in Section 2 above.

4.2 Scenario A Planning for Success Scenario A is based on Felixstowe’s retaining its existing share of the market, i.e. 40%, - until new competitors (Gateway and Teeside) come into operation around 2010/11. It is recognised that new delivery could be delayed and the impacts on land requirements should be monitored. The planned capacity of these new terminals would assume to provide/secure approximately 15% of total GB capacity in the period 2010/11-2023 and Felixstowe’s traffic is reduced to 34% of GB traffic to reflect this. This scenario assumes that: ƒ Felixstowe improves its container handling speeds as part of it overall investment programme; and ƒ Felixstowe would be efficient and economic enough to attract some of the new 10 - 12,000 TEU ships.

Other assumptions are that sufficient capacity is brought on stream to avoid congestion and that Liverpool and Bristol serve different markets (mainly the US/South America) whereas Felixstowe’s future traffic focuses on the south/east of the UK. It should also be mentioned that traffic levels could be higher if Felixstowe recovered some of the lost transhipment traffic. On this basis, Felixstowe’s traffic is forecast in broad terms as shown in Table 4.1.

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Table 4.1 Port Planning Scenarios: Felixstowe Container Traffic Forecasts*

Scenario A - Planning for Success 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

GB Containers 7,772 8,331 8,891 9,450 10,009 10,436 10,864 11,291 11,719 12,146 12,550 12,954 13,359 13,763 14,167 14,571 14,975 15,380 Felixstowe's Share without New Terminals (%) 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% Felixstowe's Share without New Terminals (000 TEU) 3,109 3,333 3,556 3,780 4,004 4,175 4,346 4,516 4,687 4,858 5,020 5,182 5,343 5,505 5,667 5,828 5,990 6,152 Minus traffic lost to new ports (Gateway and Tees) 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Felixstowe forecast 3,333 3,556 3,780 3,403 3,548 3,694 3,839 3,984 4,130 4,267 4,404 4,542 4,679 4,817 4,954 5,092 5,229 Laden 2,466 2,632 2,797 2,518 2,626 2,733 2,841 2,948 3,056 3,158 3,259 3,361 3,463 3,564 3,666 3,768 3,870 Empty 866 925 983 885 923 960 998 1,036 1,074 1,109 1,145 1,181 1,217 1,252 1,288 1,324 1,360

Scenario B - Business as Usual 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

GB Containers 7,772 8,331 8,891 9,450 10,009 10,436 10,864 11,291 11,719 12,146 12,550 12,954 13,359 13,763 14,167 14,571 14,975 15,380 Felixstowe's Share without New Terminals (%)(a) 40% 39% 39% 38% 38% 37% 37% 36% 36% 35% 35% 34% 34% 33% 33% 32% 32% 31% Felixstowe's Share without New Terminals (000 TEU) 3,109 3,286 3,457 3,622 3,783 3,889 3,991 4,090 4,185 4,276 4,356 4,433 4,507 4,578 4,646 4,711 4,774 4,834 Minus traffic lost to new ports (Gateway and Tees) 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Felixstowe forecast 3,109 3,286 3,457 3,622 3,215 3,305 3,392 3,476 3,557 3,635 3,703 3,768 3,831 3,891 3,949 4,005 4,058 4,109 Laden 2,431 2,558 2,681 2,379 2,446 2,510 2,572 2,632 2,690 2,740 2,788 2,835 2,880 2,922 2,964 3,003 3,040 Empty 854 899 942 836 859 882 904 925 945 963 980 996 1,012 1,027 1,041 1,055 1,068 (a) Felixstowe's Share declining by 1.8%

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Scenario Aii - Delayed Competing Capacity** 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

GB Containers 7,772 8,331 8,891 9,450 10,009 10,436 10,864 11,291 11,719 12,146 12,550 12,954 13,359 13,763 14,167 14,571 14,975 15,380 Felixstowe's Share without New Terminals (%) 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% Felixstowe's Share without New Terminals (000 TEU) 3,109 3,333 3,556 3,780 4,004 4,175 4,346 4,516 4,687 4,858 5,020 5,182 5,343 5,505 5,667 5,828 5,990 6,152 Minus traffic lost to new ports (Gateway and Tees) 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Felixstowe forecast 3,333 3,556 3,780 4,004 4,175 4,346 3,839 3,984 4,130 4,267 4,404 4,542 4,679 4,817 4,954 5,092 5,229 Laden 2,466 2,632 2,797 2,963 3,089 3,216 2,841 2,948 3,056 3,158 3,259 3,361 3,463 3,564 3,666 3,768 3,870 Empty 866 925 983 1,041 1,085 1,130 998 1,036 1,074 1,109 1,145 1,181 1,217 1,252 1,288 1,324 1,360

Note*: 26% of Felixstowe’s containers (3% of inbound and 51% of outbound) were empty in 2006. Forward assumption is that this ratio is held constant. The “additional traffic loss” referred to is that resulting from having new entrants to the market, in addition to traffic already being lost to the smaller ports (at a rate of 15% p.a over the last five years).

Note **: Scenario Aii adjusts the forecast represented in Scenario A to reflect the possible late delivery of competing capacity at new ports coming into operation.

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4.3 Scenario B Business as Usual Scenario B, business as usual, assumes the continuation of existing trends, in particular: ƒ Felixstowe continues to lose its share of the market at the same rate as over the last five years – i.e. by minus 1.8% p.a.; ƒ Felixstowe’s efficiency remains low relative to North West European port standards – Felixstowe handling speeds are below 25, versus over 25 for the North West ports; ƒ Transhipment of GB containers from North West European ports continues to increase – see relative port performance in Table 2.5; and ƒ The introduction of the new 12,000 TEU ships will cause a reduction in direct calls. This would not necessarily have a strong negative impact on Felixstowe, as a reduction in direct calls will not reduce GB container port traffic. The volumes entering and leaving UK ports would remain the same, although a higher proportion would be in feeder ships rather than direct call ships. It will, however, affect the distribution of traffic between ports.

In the case of the loss of direct calls the logic is that the traffic that was limited to 4 deep-sea ports (Felixstowe, Southampton, Thamesport and London) would increasingly go to a range of smaller east coast ports closer to inland origins and destinations, especially Forth, Tees and Hull / Immingham, as well as the established deep sea ports of Felixstowe, London and Thamesport. It is recognised that the scale of these moves is modest relative to the total but are worthy of note. This trend has already started, with traffic at Tees, Forth and Hull/Immingham increasing by 15% p.a. in the period 2001-2006, while the traffic growth rate at the established deep sea port has been only about 2% p.a. The ports that would be used are difficult to predict, but it is clear that several are well located to feed the main areas generating cargo in the UK.

The DfT stopped reporting inland origins and destination in 1996, but their earlier statistics showed the ranking of destinations, in declining order of containerized import volumes, as follows:

− Northwest

− Midlands

− London

− South East

− Yorkshire and Humber

The other regions (South West, Wales, Scotland, the North and North Ireland) had much lower levels of traffic. For exports, the North West and Yorkshire/Humber dominate.

Felixstowe still retains two advantages. First, it is better located than Forth, Tees or London in terms of sea distances from Rotterdam and Antwerp, and so may retain a large part of future traffic. Second, the short sea ports do not have sufficient capacity

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to take a large share of Felixstowe’s traffic, and although they would probably introduce new feeder berths, it would take some time. On this basis, Felixstowe’s traffic is forecast as shown in the bottom section of Table 4.1.

There are risks in these planning assumptions. Felixstowe is exposed to two of these albeit they are of different “strength”.

First, is that if the port is unable to bring capacity on stream and improve port handling speeds then there is a risk the new 12,000 TEU ships will not call on Felixstowe, but feed to the UK from more efficient continental ports. Two issues are at play. On one hand there is not sufficient physical capacity to handle the vessels and on the other hand, there will be a need for improved turnaround if these vessels are to make port calls cost-effective. This risk is seen as modest and it is anticipated new capacity will come on stream roughly as planned.

Second and less critical given the overall size of the market, as port centric distribution operations grow in importance, they will pull traffic towards ports closer to inland destinations and capture more growth – this process could be enhanced if feeding from the continent significantly increases and thus allows greater port choices as vessel sizes decline. A key driver here will be the relative strength of port centric vs more conventional golden triangle solutions in shaping cargo flows as transport costs increase. Road mile take out is expected to be a key driver.

The planning goal is to improve competitiveness and that should focus on planning for success. In this case, the focus is on ensuring that sufficient land is made available to enable the port to grow business and this means ensuring the land / site supply pipeline is in place in advance of demand; an issue of growing importance as port competition is increasing and Felixstowe is probably facing a more difficult environment than in the past.

From a port planning perspective, the risks are asymmetric. If land supply is deficient then port competitiveness is likely to be impaired, potentially damaging value-added and employment benefits to the region as they relate to the port sector. The more ports fail to compete, the higher the risk of relative decline – not least of which is a result of a more competitive market.

On balance, it is likely that under-providing for port and logistics related land uses will be more problematic than over-provision. Getting land into the planning pipeline and available as supply will take time. If potential sites are allocated to non-port uses and developed as such, they become unavailable and permanently reduce the options available to the port. By way of contrast, if at a future point there is no need for additional land for port-related uses, this land can be released for alternative uses as the market develops.

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5 LAND IMPLICATIONS OF PORT GROWTH AND LOGISTICS

5.1 From Traffic Forecasts to Land Requirements 5.1.1 Interaction between On-port and Off-port Activities On-port and off-port activities interact to drive the requirement for land. However, in developing a model to project off-port land requirements related to operations at the Port of Felixstowe, the impact of on-port activities has been held constant. This approach was chosen for a number of reasons. First, it was explicitly not within the remit of the study to address issues around the efficiency of the port. Second, holding the impact of on-port activities constant allowed for the development of a simpler model, the projections of which are focussed on fluctuation of activities and performance of off-port activities. These projections form a base that can be evaluated in light of on-port activities, their impact and how they might affect off-port land requirements. Key issues to be kept in mind in this context include the following.

Port efficiency Information gathered from interviews conducted to support this study suggests that handling efficiencies on quay can have a large impact further along the logistics chain. The impact is especially pronounced in the treatment of empties. Slow handling speeds have resulted in ships leaving before being fully loaded with available empties, causing a back-up of outbound containers. The impact of this effect is not always linear. A back-up of empties might require shippers to find land off-port for empties storage. However, it might also lead to new approaches to addressing the problem, such has been the case with several shipping companies who now use the port at Ipswich to tranship empties to Zeebrugge circumventing Felixstowe altogether.

Use of the yard FSR will see the redevelopment of a significant portion of port lands. Even after FSR, the layout of the yard may not be as rationalized as it might ideally be, thus reducing on-port storage capacity and requiring additional storage needs be met off-port. This reality reflects strategic choices by the port about the layout and management of their lands. The focus of this work is off-port requirements on the assumption of current operational practices (with some improvement). However, it is important to work with the port to ensure that best use is made of on-port land and facilities in the first instance.

Dwell times If the first consideration of the on-port container storage capacity is quantity of land, the second is dwell times. Currently, dwell times for laden containers are averaging 4.5 days per container on the port. Dwell times and the Port’s commercial terms of seven day free storage allowance at the port (varies by customer and service) determine when operators shunt their containers from the port and onto off-port container storage. Off port, it is recognised that dwell times are likely to vary between laden (mainly inbound) and empty (mainly outbound) and that the latter are likely to be much higher than laden. However, where they are held will be cost sensitive, low cost storage options will be a priority. A sensitivity analysis based on densities and dwell times in provided in the Annex D.

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5.1.2 Projecting Off-port Land Requirements The container forecast data for the Port of Felixstowe presented in Section 4 forms the basis of projections of the off-port land requirement. Two methodologies have been developed to operationalise these volumes. A summary of these methodologies is presented here, followed by the projections themselves. An explanation of the methodologies is necessary to understand the assumptions which shape them and the flex in the model. A detailed description of the assumptions made is included in Annex D. The projection tables included in this section show each method step by step. A duplicate version of the projection tables with line by line explanations is included in Annex D.

A Common Starting Point

The container forecast data presented in Section 4 provides gross volumes handled by the Port of Felixstowe. However, much of this volume will never be handled on off-port lands within the study area. A percentage will be transhipped directly from the Port of Felixstowe to other ports on feeder ships. Most substantial in terms of volume, a portion will be shipped directly from the port to destinations outside of the study area by road and rail. The common starting point for both methodologies is to separate the volume of containers that will be handled on lands off-port within a 30-mile radius of the port from the gross volume. Figure 5.1 shows these steps in the model and the assumptions that allow the gross volume to be broken down into its component parts.

Figure 5.1 – Determining volume to be handled on off-port land

As Figure 5.1 shows, from the gross volume, 10% is assumed to be transhipped, leaving 90% of the volume that leaves the port gate via land connections. Of this remaining 90%, 25% is assured to be shipped directly out of the study area on rail, 45% is assumed to be shipped directly out of the study area by road, leaving 30% that is handled on off-port land within 30 miles of the port. The basis for identifying 30% as the percentage of volume handled off-port is discussed in Annex D.19

19 There are no detailed origin/destination studies available. The assumptions here were based on available data review, FSR and interviews. The assumptions were tested at the 8 September 2008 workshop and were broadly deemed to be a reasonable basis for future planning.

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This portion of the methodology is defined by two major assumptions:

1. The percentages of container volume being transhipped, moved out of the study area by rail and road and handled off-port is held constant. However, these percentage shares are a point of flex in the model. A significant shift toward port centric logistics would increase the percentage of the volume being addressed off- port and thereby increase the demand for land beyond what these models project. Port centric operations are dependent on surplus land around the port available at reasonable prices and an economy of transport that allows them to compete with other models of logistics provision.

2. Although the study area extends to as much as a 100-mile radius from the port, this model defines a 30-mile radius as the limit of off-port activity. This was selected because 30 miles seems to be the outer limit of what can be considered port centric due the cost and logistics of shunting to and from the port. Beyond the 30-mile limit, the benefits of proximity to the port are assumed to diminish. Therefore, once the 30-mile limit is passed the difference between being inside or outside of the larger study area is not great. From that point on, locational requirements are linked to the end destination of goods and the shape of nation- wide logistics networks rather than a requirement to be within proximity of the port. Justification for selecting 30 miles as the limit of the port centric zone is included in Annex D.

5.1.3 Method 1 The first method uses the net volume of throughput to be handled on off-port lands, as determined above, and contrasts it to the capacity of existing off-port operations. The difference between the two is the requirement of additional land needed to meet growing volumes. Figure 5.2 outlines the method’s main steps:

Figure 5.2 – Method 1

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The model provides a further level of detail by breaking down the projections between: ƒ warehousing and open storage; ƒ open storage for laden containers and open storage for empty containers; and ƒ off-port within port vicinity and off-port beyond port vicinity within 30 miles.

As a margin of safety, 20% of additional land has been added to the forecasted land requirement. An additional 15% on top of this is added to represent ancillary services supporting the port such as mechanics, repairers and haulage yards.

Assumptions are necessary to allow a conversion of container traffic volume in TEU to land area in hectares and vice versa. Calculating existing capacity requires an estimate of total off-port land, an estimate of the number of TEU a hectare of land can store or process at any one time, and an estimate of average dwell times for containers which is used to determine how many times a year the containers will turn over. Separate estimates are required for open container storage and warehousing due to different densities and rates of turnover. The estimates and assumptions required for this task were informed by interviews with operators in and around the port. A more full discussion of the assumptions made is included in the Annexes D and E.

5.1.4 Method 2 The second methodology is a simple one whose main purpose is to provide a point of comparison against which the results of the more elaborate methodology detailed above can be assessed. Figure 5.3 outlines the method’s main steps:

Figure 5.3 – Method 2

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Method 2 establishes a percentage of volume increase year-by-year for container traffic and simply uses that figure to assume matching growth in the off-port land area. The key to reliability for this method is to estimate the entirety of the existing land area off-port. The 20 % margin of safety is especially important in this instance in case the land area supporting off-port operations was in any way underestimated. Again, an additional 15 % is added to the land requirement to account for ancillary uses.

5.2 Model Results: Potential Land Requirements The projection tables in this section include separate tables for both the methodologies for estimating land requirement elaborated on above. Additionally, separate tables are included for the different growth forecasts represented in Scenario A and Scenario B of Section 2.

Importantly, to facilitate an ongoing monitoring tool and to allow amendment to key data such as modal splits and dwell times that act as key determinants in both methodologies, a baseline data worksheet has been constructed which will allow amendment of key data and subsequent translation for each of the four projection tables. It is included in the Annex E.

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Row Method 1: Scenario A - Optimistic Scenario Table 5.1: 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

1 FORECAST DATA 1.01 Felixstowe Forecast 3,109 3,333 3,556 3,780 3,403 3,548 3,694 3,839 3,984 4,130 4,267 4,404 4,542 4,679 4,817 4,954 5,092 5,229

1.02 Actual Throughput excluding transhipment (000 TEU) 2,798 3,000 3,200 3,402 3,063 3,193 3,325 3,455 3,586 3,717 3,840 3,964 4,088 4,211 4,335 4,459 4,583 4,706 Actual Throughput excluding transhipment, rail and road transport 1.03 (000 TEU) 839 900 960 1,021 919 958 997 1,037 1,076 1,115 1,152 1,189 1,226 1,263 1,301 1,338 1,375 1,412

2 OFF-PORT CAPACITY WITHIN PORT VICINITY

2.01 Existing open container storage capacity (000 TEU p.a.) 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314

2.02 Existing open container storage laden capacity (000 TEU p.a.) 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283

2.03 Existing open container storage empty capacity (000 TEU p.a.) 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31

2.04 Existing warehousing throughput capacity (000 TEU p.a.) 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50

OFF-PORT CAPACITY BEYOND PORT VICINITY WITHIN 3 30 MILES

3.01 Existing open container storage capacity (000 TEU p.a.) 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496

3.011 Existing open container storage laden capacity (000 TEU p.a.) 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347

3.012 Existing open container storage empty capacity (000 TEU p.a.) 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149

3.02 Existing warehousing throughput capacity (000 TEU p.a.) 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63

4 TOTAL CAPACITY

Existing open container storage capacity in port vicinity and within 30 4.01 miles (000 TEU p.a.) 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810

Existing open container storage laden capacity in port vicinity and 4.011 within 30 miles (000 TEU p.a.) 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630

Existing open container storage empty capacity in port vicinity and 4.012 within 30 miles (000 TEU p.a.) 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 Existing warehousing throughput capacity in port vicinity and within 4.02 30 miles (000 TEU p.a.) 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112

Total capacity of container storage and warehousing in port vicinity 4.03 and within 30 miles (000 TEU p.a.) 923 923 922 923 923 923 923 923 923 923 923 923 923 923 923 923 923 923

5 UNMET LAND DEMAND

5.01 Unmet TEU forecast (000 TEU) -83.2 -22.7 37.9 98.0 -3.8 35.4 74.8 113.9 153.1 192.5 229.5 266.5 303.8 340.7 378.0 415.0 452.3 489.2

5.02 Unmet Container Storage (000 TEU) -73.0 -19.9 33.3 86.1 -3.3 31.1 65.7 100.1 134.4 169.1 201.6 234.0 266.8 299.2 332.0 364.4 397.2 429.6

5.021 Unmet Laden Container Storage (000 TEU) -64.8 -17.7 29.5 76.3 -2.9 27.6 58.3 88.7 119.2 149.9 178.8 207.6 236.6 265.4 294.4 323.2 352.2 381.0

5.022 Unmet Empty Container Storage (000 TEU) -8.3 -2.3 3.8 9.7 -0.4 3.5 7.4 11.3 15.2 19.1 22.8 26.5 30.2 33.9 37.6 41.2 44.9 48.6

5.03 Unmet Warehousing Storage (000 TEU) -10.1 -2.8 4.6 11.9 -0.5 4.3 9.1 13.9 18.7 23.5 28.0 32.5 37.0 41.5 46.0 50.6 55.1 59.6

5.04 Unmet Container Storage (ha) -4.4 -1.2 2.0 5.2 -0.2 1.9 4.0 6.1 8.1 10.2 12.2 14.2 16.1 18.1 20.1 22.0 24.0 26.0

5.05 Unmet Warehousing Storage (ha) -9.7 -2.6 4.4 11.4 -0.4 4.1 8.7 13.3 17.8 22.4 26.7 31.1 35.4 39.7 44.0 48.4 52.7 57.0

5.06 Unmet Container Storage + 20% margin (ha) -5.3 -1.4 2.4 6.2 -0.2 2.3 4.8 7.3 9.8 12.3 14.6 17.0 19.4 21.7 24.1 26.4 28.8 31.2

5.07 Unmet Warehousing Storage + 20% margin (ha) -11.6 -3.2 5.313.7-0.5 4.910.515.921.426.932.137.342.547.652.958.063.268.4

5.08 Total Unmet Storage (ha) -16.9 -4.6 7.720.0-0.8 7.215.223.231.239.246.754.261.869.476.984.592.199.6

5.09 Total Unmet Storage +15% Ancilliary (ha) -19.5 -5.3 8.9 22.9 -0.9 8.3 17.5 26.7 35.8 45.1 53.7 62.4 71.1 79.8 88.5 97.1 105.9 114.5

J30254973 36 Felixstowe Port Logistics Study Final Report October 2008

Table 5.2

Row Method 1: Scenario B - Base Case Scenario, Continuation of Existing Trends 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

1 FORECAST DATA 1.01 Felixstowe Forecast 3,109 3,286 3,457 3,622 3,215 3,305 3,392 3,476 3,557 3,635 3,703 3,768 3,831 3,891 3,949 4,005 4,058 4,109

1.02 Actual Throughput excluding transhipment (000 TEU) 2,798 2,957 3,111 3,260 2,894 2,975 3,053 3,128 3,201 3,272 3,333 3,391 3,448 3,502 3,554 3,605 3,652 3,698

1.03 Actual Throughput excluding transhipment, rail and road transport (000 TEU) 839 887 933 978 868 892 916 939 960 981 1,000 1,017 1,034 1,051 1,066 1,081 1,096 1,109

2 OFF-PORT CAPACITY WITHIN PORT VICINITY

2.01 Existing open container storage capacity (000 TEU p.a.) 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314 314

2.02 Existing open container storage laden capacity (000 TEU p.a.) 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283 283

2.03 Existing open container storage empty capacity (000 TEU p.a.) 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31 31

2.04 Existing warehousing throughput capacity (000 TEU p.a.) 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50 50

OFF-PORT CAPACITY BEYOND PORT VICINITY WITHIN 30 3 MILES

3.01 Existing open container storage capacity (000 TEU p.a.) 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496 496

3.011 Existing open container storage laden capacity (000 TEU p.a.) 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347 347

3.012 Existing open container storage empty capacity (000 TEU p.a.) 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149 149

3.02 Existing warehousing throughput capacity (000 TEU p.a.) 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63 63

4 TOTAL CAPACITY

Existing open container storage capacity in port vicinity and within 30 miles 4.01 (000 TEU p.a.) 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810 810

Existing open container storage laden capacity in port vicinity and within 30 4.011 miles (000 TEU p.a.) 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630 630

Existing open container storage empty capacity in port vicinity and within 30 4.012 miles (000 TEU p.a.) 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 180 Existing warehousing throughput capacity in port vicinity and within 30 miles 4.02 (000 TEU p.a.) 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112 112

Total capacity of container storage and warehousing in port vicinity and within 4.03 30 miles (000 TEU p.a.) 923 923 922 923 923 923 923 923 923 923 923 923 923 923 923 923 923 923

5 UNMET LAND DEMAND

5.01 Unmet TEU forecast (000 TEU) - 83.2 - 35.4 11.2 55.4 - 54.5 - 30.2 - 6.7 15.9 37.8 58.9 77.2 94.8 111.8 128.0 143.6 158.8 173.1 186.8

5.02 Unmet Container Storage (000 TEU) - 73.0 - 31.1 9.8 48.6 - 47.9 - 26.5 - 5.9 14.0 33.2 51.7 67.8 83.2 98.2 112.4 126.1 139.4 152.0 164.1

5.021 Unmet Laden Container Storage (000 TEU) - 64.8 - 27.5 8.7 43.1 - 42.5 - 23.5 - 5.2 12.4 29.4 45.8 60.1 73.8 87.1 99.7 111.9 123.7 134.8 145.5

5.022 Unmet Empty Container Storage (000 TEU) - 8.3 - 3.5 1.1 5.5 - 5.4 - 3.0 - 0.7 1.6 3.8 5.8 7.7 9.4 11.1 12.7 14.3 15.8 17.2 18.6

5.03 Unmet Warehousing Storage (000 TEU) - 10.1 - 4.3 1.4 6.7 - 6.6 - 3.7 - 0.8 1.9 4.6 7.2 9.4 11.5 13.6 15.6 17.5 19.3 21.1 22.8

5.04 Unmet Container Storage (ha) - 4.4 - 1.9 0.6 2.9 - 2.9 - 1.6 - 0.4 0.8 2.0 3.1 4.1 5.0 5.9 6.8 7.6 8.4 9.2 9.9

5.05 Unmet Warehousing Storage (ha) - 9.7 - 4.1 1.3 6.5 - 6.4 - 3.5 - 0.8 1.9 4.4 6.9 9.0 11.0 13.0 14.9 16.7 18.5 20.2 21.8

5.06 Unmet Container Storage + 20% margin (ha) - 5.3 - 2.3 0.7 3.5 - 3.5 - 1.9 - 0.4 1.0 2.4 3.8 4.9 6.0 7.1 8.2 9.2 10.1 11.0 11.9

5.07 Unmet Warehousing Storage + 20% margin (ha) - 11.6 - 4.9 1.6 7.7 - 7.6 - 4.2 - 0.9 2.2 5.3 8.2 10.8 13.3 15.6 17.9 20.1 22.2 24.2 26.1

5.08 Total Unmet Storage (ha) - 16.9 - 7.2 2.3 11.3 - 11.1 - 6.2 - 1.4 3.2 7.7 12.0 15.7 19.3 22.8 26.1 29.2 32.3 35.2 38.0

5.09 Total Unmet Storage + 15% Ancilliary (ha) - 19.5 - 8.3 2.6 13.0 - 12.8 - 7.1 - 1.6 3.7 8.9 13.8 18.1 22.2 26.2 30.0 33.6 37.2 40.5 43.7

J30254973 37 Felixstowe Port Logistics Study Final Report October 2008

Table 5.3

Row Method 2: Scenario A 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Felixstowe, Forecast 3,109 3,333 3,556 3,780 3,403 3,548 3,694 3,839 3,984 4,130 4,267 4,404 4,542 4,679 4,817 4,954 5,092 5,229 Capacity Throughput (000 TEU) 3,950 3,950 3,950 3,950 3,950 4,950 4,950 4,950 4,950 4,950 5,450 5,450 5,450 5,450 5,450 5,450 5,450 5,450

1 FORECAST DATA

1.01 Forecast utilisation of port capacity 78.7% 84.4% 90.0% 95.7% 86.2% 71.7% 74.6% 77.6% 80.5% 83.4% 78.3% 80.8% 83.3% 85.9% 88.4% 90.9% 93.4% 95.9% 1.02 Actual throughput excluding transhipment (000 TEU) 2,798 3,000 3,200 3,402 3,063 3,193 3,325 3,455 3,586 3,717 3,840 3,964 4,088 4,211 4,335 4,459 4,583 4,706 Actual throughput excl. transhipment, rail and road transport (000 TEU) 1.03 839 900 960 1,021 919 958 997 1,037 1,076 1,115 1,152 1,189 1,226 1,263 1,301 1,338 1,375 1,412 1.04 Annual increase in throughput (%) - 7.2% 6.7% 6.3% -10.0% 4.3% 4.1% 3.9% 3.8% 3.7% 3.3% 3.2% 3.1% 3.0% 2.9% 2.8% 2.8% 2.7%

1.05 Forecast land demand based on level of throughput growth (ha) 11.3 10.5 9.9 - 15.6 6.7 6.4 6.1 5.9 5.7 5.2 5.0 4.9 4.7 4.6 4.5 4.4 4.2 1.06 Running total land demand 11.3 21.7 31.6 16.0 22.7 29.1 35.2 41.2 46.9 52.1 57.1 62.0 66.7 71.4 75.8 80.2 84.4 1.07 Land demand with 20% margin 13.5 26.1 37.9 19.2 27.2 34.9 42.3 49.4 56.3 62.5 68.5 74.4 80.1 85.6 91.0 96.2 101.2 1.08 Land demand with 15% ancilliary support 15.6 30.0 43.6 22.1 31.3 40.2 48.6 56.8 64.7 71.9 78.8 85.6 92.1 98.5 104.6 110.6 116.4

Table 5.4

Row Method 2: Scenario B 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Felixstowe, Forecast 3,109 3,286 3,457 3,622 3,215 3,305 3,392 3,476 3,557 3,635 3,703 3,768 3,831 3,891 3,949 4,005 4,058 4,109 Capacity Throughput (000 TEU) 3,950 3,950 3,950 3,950 3,950 4,950 4,950 4,950 4,950 4,950 5,450 5,450 5,450 5,450 5,450 5,450 5,450 5,450

1 FORECAST DATA

1.01 Forecast utilisation of port capacity 78.7% 83.2% 87.5% 91.7% 81.4% 66.8% 68.5% 70.2% 71.9% 73.4% 67.9% 69.1% 70.3% 71.4% 72.5% 73.5% 74.5% 75.4% 1.02 Actual throughput excluding transhipment (000 TEU) 2,798 2,957 3,111 3,260 2,894 2,975 3,053 3,128 3,201 3,272 3,333 3,391 3,448 3,502 3,554 3,605 3,652 3,698 Actual throughput excl. transhipment, rail and road transport (000 TEU) 1.03 839 887 933 978 868 892 916 939 960 981 1,000 1,017 1,034 1,051 1,066 1,081 1,096 1,109 1.04 Annual increase in throughput (%) - 5.7% 5.2% 4.8% -11.2% 2.8% 2.6% 2.5% 2.3% 2.2% 1.9% 1.8% 1.7% 1.6% 1.5% 1.4% 1.3% 1.3% 1.05 Forecast land demand based on level of throughput growth (ha) 8.9 8.1 7.5 - 17.6 4.4 4.1 3.9 3.6 3.4 2.9 2.7 2.6 2.5 2.3 2.2 2.1 2.0 1.06 Running total land demand 8.9 17.1 24.5 6.9 11.3 15.4 19.3 23.0 26.4 29.3 32.1 34.7 37.1 39.5 41.7 43.8 45.7 1.07 Land demand with 20% margin 10.7 20.5 29.4 8.3 13.6 18.5 23.2 27.6 31.7 35.2 38.5 41.6 44.6 47.4 50.0 52.5 54.9 1.08 Land demand with 15% ancilliary support 12.3 23.5 33.8 9.6 15.6 21.3 26.7 31.7 36.4 40.5 44.3 47.9 51.2 54.5 57.5 60.4 63.1

J30254973 38 Felixstowe Port Logistics Study Final Report October 2008

5.3 Summary of Sensitivities and Uncertainties As detailed above, developing methods to project the land requirement based on port volume growth forecasts involved making a number of assumptions. Assumptions were made based on the best available data and consultations with operators in and around the port. Altering these assumptions themselves or changing the way they interact with each other has the potential to affect the projections. Below is a list of the main sensitivities in the models and their implications:

Rate of transhipment – The models set the percentage of transhipment at 10% of gross volume. A rise in the percentage of transhipment will affect on-port operation at the quay and in the container yard, which may have knock-on effects for volume of traffic leaving the port gate via land connections.

Port centric handling – After transhipment is stripped out of gross volumes, the remainder is divided between containers leaving the study area via rail and road and containers that will be handled within the study area at a ratio of 70:30. Detailed origin- destination information is not available for containers handled at the Port of Felixstowe. Therefore, this split is based on the rail capacity of FSR, the traffic counts over the Orwell Bridge, information on the locations of distribution centres and regional distribution centres and interviews with operators. Shifts in this ratio will have the same impact as an increase or reduction in overall volumes. It is possible that the 70:30 split is an overestimation of the volume which is handled off-port. In this case, the forecast errs on the side of slightly overestimating the land requirement in order to recognise the potential for growth in port centric activities.

Proportion of port centric – The 70:30 split discussed above assumes that the proportion of port-centric activities will remain constant. A shift over time towards more port-centric operations could mean a rising share of port volumes and thereby a land requirement greater than forecast in our projections.

Land/Density/Dwell - Assumptions on quantity of existing land in use, densities of containers per hectare and dwell times determine our baseline figures for TEU per hectare per year that allow for the conversion of volume (TEU) to land (ha) for open container storage and warehousing. If any of these elements change so does the baseline figure and thereby the impact of volume on land requirements. Further analysis of this point is included in Annex D.

J30254973 39 Felixstowe Port Logistics Study Final Report October 2008

6 SUPPLY OF LAND

The sections above have allowed us to forecast demand for land for port-related uses related to the operations at Felixstowe. The next step of the process is to assess the supply of land that might be, or become, available to meet that demand. This section of the report examines the potential supply of sites suitable to meet the requirements set out in the preceding section.

As a first step, the section reviews the current regional, national and local policy on employment land provision, drawn from policy documents and updated through conversations with the appropriate local authorities and regional agencies. This is followed by a discussion of the secondary sources, including employment land reviews and other documents, from which the potential sites were primarily drawn.20 From this broad source of sites, the analysis then goes on to create a long list of 28 sites across the region which might potentially meet the requirements based on a series of broad criteria, primarily related to size, location and accessibility.

The final step of the supply analysis is to carry out a detailed appraisal of the most appropriate of the potential sites. This was determined through consideration of port- centric requirements and discussions with Local Authorities. These considerations reduced the list of 28 sites to a short list of 9 sites. In consultation with Steering Group members and drawn primarily from the December 2004 DCLG Guidance on Employment Land Reviews detailed appraisal criteria was elaborated and used to appraise each of the short-listed sites.

The sites examined as part of this study were selected because they represent a fair assessment of the land potentially available for port-related uses in the study area. Most of these sites have some planning status, either planning permission or allocation for B8 uses. Other sites were included because, although they did not have planning status supportive of B8 uses, they have been brought forward as candidates for such uses in upcoming LDF processes and/or are the subject of planning applications for relevant B8 uses.

It is important to note that the list of sites identified here should in no way preclude additional new sites being proposed, and being assessed, for port-related uses. Neither should it be assumed that the sites will be allocated in the LDF process or receive a planning permission. The results of the detailed appraisal show that each site has strengths and weaknesses, the balance of which must be evaluated in determining their suitability for port-related uses. The sites evaluated as part of this study can act as a useful measuring stick against which to judge new sites as they are proposed. This said, although the detailed appraisal is a good starting point, identifying the most important criteria and how they are met by existing sites, it is in no way a substitute for the more detailed assessment that would be required during the LDF processes carried out by Local Planning Authorities in the study area or in the detailed site assessments undertaken as part of the EIA planning application process.

20 A list of the secondary sources drawn on is included on page 47.

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6.1 Regional and local planning policies and frameworks The task of determining available supply has been informed by a series of consultations with regional and sub-regional agencies, local planning authorities / economic development offices and some key private sector landowners, as well as a review of relevant studies on employment land availability and investment programmes. The policy background to land allocation for industrial, logistics and other distribution activities is set by a number of national, regional and local planning policies. These include the Regional Spatial Strategy, the Regional Economic Strategy, PPSs (including the new Draft PPS 4, Planning for Sustainable Economic Development) and National Transport Policy (including PPG 13).

6.1.1 RSS Policy and targets for economic/employment and housing growth The revised East of England Plan (published May 2008) includes a target of 50,000 net additional jobs and 56,800 net additional houses in the Haven Gateway in the period 2001-2021.21

The East of England Plan identifies the Haven Gateway as one of four areas within the East of England that requires a sub-regional approach and recognises that within the Haven Gateway there are two key centres for development and change (Colchester and Ipswich). Key policies relating to economic and housing growth from the revised East of England Plan are presented below.

Key Policies relating to the Haven Gateway from the East of England Plan

Policy Detail

Policy HG1: The sub-regional strategy aims to achieve transformational development Strategy for the and change throughout Haven Gateway which will: Sub-Region ƒ develop the diverse economy of the sub-region, including provision for the needs of an expanding tourism sector, support for the establishment and expansion of ICT clusters and recognition of the potential and need for employment growth in the smaller towns; ƒ support existing and proposed academic, scientific and research institutions; ƒ regenerate the sub-region to address unemployment, deprivation and social issues; ƒ provide for major housing growth at the key centres of Colchester and Ipswich.

21 This figure is the sum of the minimum housing targets for Colchester, Tendring, Ipswich, Suffolk Coastal and Babergh.

J30254973 41 Felixstowe Port Logistics Study Final Report October 2008

Policy Detail

Policy HG2: Local Development Documents should provide an enabling context for Employment- not less than 50,000 additional jobs in Haven Gateway distributed as in generating Policy E1. The local authorities, supported by regional and local development partners, should facilitate this increase in jobs by promoting a competitive sub-regional business environment through: ƒ supporting the maintenance and appropriate expansion of the ports, maritime and related activities, recognizing the role they play in making the sub-region a major economic growth point and approved proposals for container handling capacity at Bathside Bay and Felixstowe South; ƒ promoting the urban areas of Colchester and Ipswich as major centres of employment; ƒ providing appropriate sites, premises and infrastructure to attract a diverse range of employment to Ipswich, Colchester, Harwich, Felixstowe and Clacton; ƒ regeneration initiatives in Colchester (St Botolphs, North Station, East and North Colchester and the Garrison), ƒ Ipswich Waterfront and Village, Felixstowe (including measures to address its falling status as a resort), Harwich, Clacton, Jaywick and smaller scale projects elsewhere, with a focus on employment diversification and other social aims as well as physical renewal.

Policy HG3: Priorities for transport in the sub-region should focus on the urban Transport centres of Colchester and Ipswich and on the strategic infrastructure and infrastructure services to facilitate access to and from the Haven Ports.

Source: East of England Plan, May 2008

6.1.2 Regional Economic Strategy ‘A Shared Vision: The Regional Economic Strategy for the East of England’ was published in December 2004. It sets out eight goals for the region, of which the fourth is to achieve high quality places to live, work and visit. Under this heading, six priorities are identified. Priority three is to ensure a high quality supply of business land and premises, and in particular to: ƒ Retain existing employment sites where possible and appropriate, making them available for alternative uses only where they no longer meet regeneration and growth objectives; ƒ Ensure a scale of employment site provision and job growth to meet the needs specified in the RSS;

In order to achieve these aims, the RES indicates that the following actions should be pursued: ƒ Work with businesses to ensure sufficient high quality employment land and premises that meets their current and future needs in sustainable locations; ƒ Promote public and private sector partnerships to bring forward brownfield sites for economic activity where they can address a demonstrated business requirement;

J30254973 42 Felixstowe Port Logistics Study Final Report October 2008

ƒ Map specific land use requirements of the region’s key sectors and clusters to support planning; ƒ Support area action plans and masterplans which ensure effective integration of employment with other land uses and provide a framework for high quality development; ƒ Focus on overcoming barriers which prevent the efficient and sustainable use of land and property resources in urban and rural areas.

The sixth goal is to make the most from the development of international gateways and national and regional transport corridors. Under this heading, priority two is to make the most of our gateways to the sea, and in particular to recognise that: ƒ Major ports such as Harwich and Felixstowe have a national role in freight distribution; ƒ Ports are positive contributors to the regional economy and those situated in or close to deprived areas such as the haven ports can have an important regenerative role; ƒ To remain competitive, ports require off-site transport infrastructure of the right quality and quantity and efficient access, especially by rail, from dockside to destinations across the country is critical to achieving their full potential and delivering sustainable freight movement.

In order to achieve these aims, the RES indicates that the following actions should be pursued: ƒ Develop the potential of ports and their surrounding areas for job generation and business opportunities; ƒ Support sustainable port expansion proposals and port related developments; ƒ Develop enhanced access to ports, in tandem with port expansion plans, and increase the proportion of freight travelling by rail with particular emphasis on rail freight interchanges and the Haven Gateway – Nuneaton rail freight unit.

At the time of drafting this report, the 2008-2031 RES was officially a Consultation Draft. The Draft continues to support enhancement of key transport corridors including those accessing the port gateways. The effects of the sub-national review in integrating regional economic and spatial planning are expected to create a more responsive planning framework and a priority will be placed on providing high quality employment sites that meet the needs of business and key sectors in key centres of development and change.

6.1.3 National Statutory Spatial Policy and Guidance Central to the Government’s aim to develop the competitiveness of the economy is the recognition that Local Authorities must provide sufficient employment land which is responsive to development needs, whilst at the same time understanding the social and environmental consequences of employment land allocation.

Specific details of statutory requirements are to be found in Government’s planning policy statements, guidance notes and published good practice, most of which emphasise the need for a robust evidence base including:

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ƒ Planning Policy Guidance 4 “Industrial, commercial development and small firms” – The key message of this Guidance note, published in 2004, is to encourage local authorities to develop a better understanding of the locational factors affecting business. Listed locational factors include site access, access to markets, workforce, suppliers and customers. In addition, local authorities must “seek to achieve wider objectives in the public interest” ƒ Draft PPS 4, Planning for Sustainable Economic Development – The draft PPS builds on policy and government strategy found elsewhere including the needs for authorities to develop robust evidence bases for planning policy development and encouraging a more flexible approach to the use of land including more mixed use developments. The key government objectives for local and regional authorities in seeking to achieve positive planning for economic development are:

− A good range of sites identified for economic development and mixed- use development

− A good supply of land and buildings which offer a range of opportunities for creating new jobs in large and small businesses as well as start-up firms and which is responsive to changing needs and demands.

− High quality development and inclusive design for all forms of economic development;

− Avoiding adverse impacts on the environment, but where they are unavoidable , providing mitigation; and

− Shaping travel demand by promoting sustainable travel choices however possible. ƒ PPS 12: Local Development Frameworks (LDFs) – This planning statement provides guidance to local authorities on the preparation of their LDFs. A key principle is for the plans and policies to be based on a robust evidence base and for local authorities to be able to demonstrate a “credible assessment of the suitability, availability and accessibility of land for particular uses or mix of uses.” ƒ PPS 11: Regional Spatial Strategies – The Government is promoting the need for an improved economic evidence base for both the RSS revisions and RESs. “A sound evidence base to regional strategies and a sufficient spatial dimension to RESs are critical both to effective RSS revisions and to the delivery of regional economic convergence.” ƒ Local Development Framework, Core Output Indicators update, ODPM, 2005 – This document lists the core output indicators for local development frameworks. The indicators generally replicate the business floorspace regional output indicators to facilitate a flow of information from the local to the regional level viz:

− Amount of floorspace developed for employment by type (as defined by the Use Classes Order);

− Amount of floorspace developed for employment by type, in employment or regeneration areas;

− Amount of floorspace by employment type which is on previously developed land;

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− Employment land available by type;

− Losses of employment land in (i) employment/regeneration areas and (ii) local authority area; and

− Amount of employment land lost to residential development.

− Local authorities are also required to monitor the amount of completed office (B1(a)) development as part of local services monitoring (PPS 6 see above). ƒ PPG13: Transport – sets out a number of objectives to integrate planning and transport to promote more sustainable transport choices for both people and for moving freight. Promoting accessibility to jobs, shopping, leisure facilities and services by public transport, walking and cycling is also a key objective, together with reducing the need to travel by car. Co-ordinating transport and land use planning is a key aim of PPG13 as is setting maximum parking standards rather than minimum, promoting the use of travel plans and requiring local authorities to allocate or reallocate key sites which are accessible by non car modes for travel intensive uses.

6.1.4 Local Planning Policy on Employment Land for Logistics and Port-related Distribution Local planning authorities in the Haven Gateway area were consulted on current policy and progress on the overall supply / availability of suitable vacant land for port-related logistics and back-up uses. Other sub-regional regeneration agencies and key private sector land owners were also consulted. Whilst Local Plans and LDFs are at differing stages of preparation and adoption, some consistent general themes emerge: ƒ There is a broad consensus that the conclusions of the 2005 DTZ Employment Land Review which identified an oversupply of most types of employment land – and specifically strategic port-related logistics sites – are not supported. Most of those consulted in both the public and private sectors highlight a shortage of readily available port-related sites outside of the existing port area. ƒ Most authorities are now committed to carrying out employment land reviews in conjunction with LDF preparation and/or participating in the ELR to be undertaken by Haven Gateway using guidance provided by EEDA. In the meantime most authorities have carried out assessments of their existing allocated sites on which this study can draw. ƒ The sites identified in the East of England region in the EEDA Strategic Sites Study (see Section 6.2 below) form the basis of most of the sites under consideration by the local authorities for logistics or other major employment purposes. However most authorities are focusing on carrying out their own local site assessments as part of the evidence base required for LDFs. ƒ In view of increasing housing allocations in the RSS / Growth Point designation most authorities are concerned to maintain a sustainable job balance ratio and meet higher job growth targets. Employment land demand/need is therefore expected to be higher, increasing the area of available land required and the need for higher job density targets. ƒ In view of a perceived shortage of available strategic employment sites of all types, the use of such sites for low (worker) density / lower value employment

J30254973 45 Felixstowe Port Logistics Study Final Report October 2008

uses such as B8 or port back-up uses such as container storage or lorry parking is a low priority for most authorities. Typically authorities are prioritising allocations for B1, ICT uses or mixed use. ƒ The private sector has identified other potential long-term land holdings in the A14 corridor and, in particular, port centric sites around Felixstowe. In these cases aspirations are usually for port-related / logistics use – not for container storage or lorry parking uses. ƒ There is significant concern about freight transport issues on the A14 and the rail corridors. Most local authorities have identified overall capacity – and specifically junction and Orwell Bridge capacity – on the A14 through the Haven Gateway area as an issue which is expected to worsen as port capacity grows. The limited number of lorry parks and lay-bys used for overnight parking are insufficient and there is an acute problem when Operation Stack is in operation. There is also concern that while rail signalling and track improvements will improve rail freight capacity, this might result in the limitation of passenger services.

6.2 Identifying a Pool of Sites from which to Draw The work of local planning authorities in preparing the RSS, Local Development Frameworks and Employment Land Reviews (ELRs) has been based on the policies described above and has identified and designated industrial sites – mainly for B8 distribution purposes, some of which are specifically identified as port-related – to meet these requirements

This section reviews the availability of suitable vacant industrial sites across the region as a whole, and beyond, adequate to meet these needs. In view of the large scale and accessibility requirements of the port-related distribution sectors, the analysis has focused on large sites – often referred to as strategic or regional/sub-regional sites, including port-related sites. In practice there is some debate in the RSS, EEDA studies and local ELRs as to the definition of “strategic sites” but for the purposes of identifying a pool of sites from which to draw, we initially identified all sites over 5 hectares and any others which have been labelled “strategic” or “sub-regional”.

The process for identifying a potential sites for this study has been based on the use of secondary sources – mainly strategic and local employment land and sites studies and discussions with local planning authorities on planning applications and sites being identified as part of the LDF process – which have analysed the supply of all employment sites in their areas comprehensively. The principal sources of information used have been: ƒ EEDA “Study of Strategic and Sub-regional Employment Sites” prepared by Chesterton, August 2002; ƒ EEDA “East of England Employment Land Reviews and Guidance” – prepared by Roger Tym and Partners, October 2007; ƒ “East Midlands Strategic Distribution Study” – prepared by Savils, MDS, Roger Tym and Partners, December 2006; ƒ DTZ “Employment Land Study” (December 2005) carried out for the Haven Gateway Partnership;

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ƒ Results of other ELRs carried out by individual districts in the Haven Gateway area; and ƒ The results of stakeholder consultations which include questions on current site availability. This includes information from local planning authorities on sites which are subject to current planning applications and sites which have been identified by owners and others as part of the ongoing LDF process.

The Strategic Sites Study prepared by Chesterton in August 2002 for EEDA is the most regionally comprehensive of these studies and identifies a list of 68 “Strategic Sites” which includes Employment Sites capable of accommodating a user requiring a plot in excess of 5 hectares and Special User Sites (e.g. port-, airport-related) – both available now or within 24 months. Fourteen of these sites are in Suffolk – though most of these are not in the A14 corridor (Table 6.1). A further 76 sub-regional sites capable of accommodating a user requiring smaller plots have been identified, of which eleven are in Suffolk (Table 6.2).

Table 6-1 EEDA Strategic Employment Sites Total No. Currently Not Greenfield Brownfield Of Sites Available Available Suffolk 13 6 7 7 6

Total 68 39 29 5 3

Table 6-2 EEDA Sub-Regional Employment Sites Total No. Currently Not Greenfield Brownfield Of Sites Available Available Suffolk 11 11 0 6 5

Total 76 61 14 48 27

Since this study, which is now more than 6 years old, was completed, major reviews of the employment land supply have been carried out for the Haven Gateway, for individual local authorities and a review of strategic sites is underway for EEDA and for the SDA. These have extended the number of sites over 5 hectares identified to more than 200 sites in the East of England.

6.3 Creating the Long List of Sites As noted, the sites discussed above are potentially for all industrial and commercial employment purposes. In order to screen this larger pool to identify sites suitable for port-related uses we have considered a number of criteria. The criteria are fairly broad, but directly related to the primary needs of the logistics sector. They are: ƒ Size – Only sites over 10 hectares have been included. It is acknowledged that certain port-related uses such as open container storage and ancillary uses could make use of sites that are less than 10 ha. However, it is this piecemeal approach to off-port development that has too often led to the spread of port- related uses on scattered small sites with inadequate site preparation and buffering from other uses. If port related uses are to be promoted they must be seen as good neighbours rather than eyesores and nuisances. This lower limit

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has been set to allow sites to be allocated and developed on a consolidated basis and to enable sites to be serviced and buffered efficiently. This said, if sites came forward which met the intentions of this size limit while being smaller than 10 ha, they should be evaluated on a case-by-case basis; ƒ Planning status – Selected sites are for the most part designated in Local Plans or LDFs, the subject of planning applications or, in selected cases within the Haven Gateway, have been proposed by owners or local authorities for designation in LDFs; ƒ Where sites are designated they should normally have a B8 designation or consent. This is often in conjunction with a B1 and/or B2 designation; ƒ Significantly, sites should have good access to a strategic road access corridor based on the A14, A12, A1M, M1 and linking strategic routes between the port and the Midlands or London; ƒ Where rail access is available this has been prioritized, though many sites are not accessible by rail; ƒ Generally the availability of sites within the Haven Gateway – and in particular those which may be defined as “port centric” – have been examined most closely and are more likely to have been included even where some other criteria are less well met; ƒ A site’s “Brownfield” or “Greenfield” status has been noted but this has not determined inclusion or exclusion at this stage.

Table 6.3a and 6.3b and Figure 6.1 overleaf identify 28 sites in the East of England region which meet these broad screening criteria which total over 800 hectares. Of these: ƒ 10 sites totalling 250 hectares are in the Haven Gateway area; ƒ 14 sites totalling over 390 hectares are in Suffolk; and ƒ 13 sites are in the remainder of the East of England region – in Cambridgeshire, Peterborough and Bedfordshire - totalling 450 hectares.

The long-list has been divided into two parts based on planning status. Table 6.3a lists sites with planning allocation and/or planning permission for port-related uses. Table 6.3b lists sites that do not have planning allocation or planning permission allowing port-related uses, but have emerged as possible sites for such uses based on planning applications or requests to be considered in upcoming LDF processes. Although discussed here, their inclusion in this report is in no way a substitute for the more detailed processes to be carried out by local authorities in evaluating planning applications or in developing LDFs, or the detailed site assessment undertaken as part of the EIA planning application process.22 Moreover, the sites in Table 6.3b are not a

22 Specifically, some sites have been put forward for the consideration of Suffolk Coastal District Council as part of its LDF. At this stage in the process the Council has not assessed these sites and made a decision as to whether they will be allocated and subjected to the processes of consultation and independent examination. This is particularly important given the environmental constraints to be considered. However, one of the sites is located alongside the A14 at the Port and demonstrates a willingness on the part of the landowner to release the land for the purpose port-related uses. Therefore, it has been identified as a ”potential” site for the purposes of this study. The District Council will assess other proposals on their merits

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comprehensive list of currently unallocated sites that would be suitable for port-related uses. Other sites are likely to come forward and should be considered on their own merits.

Tables 6.3a and 6.3b list the screened sites, giving a short description of the sites’ planning history, planning status, size and type. In some cases these sites do not have defined boundaries and are identified as broad locations or, in some cases, as collections of sites at one location.

and against the finding of this study. At this stage, therefore, they have not been included as potential locations.

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Figure 6.1 Identified Sites

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Table 6.3a Indicative Long List of Potential Strategic Logistic/Distribution Sites in East of England Region – Allocated Sites

Site Site/Location Description Area Site Type Stage in Development Planning No. (Ha) Process Status Haven Gateway and rest of Suffolk 2 Shepherd's Former Stanton airfield has the potential to cater for 53 Brownfield Medium Term Allocated Grove, Stanton major employment facilities. Planning permission B1,B2,B8 associated with IKEA application – not implemented. Rural road access from A14. 3 British Sugar, Former food processing plant now owned by 31 Brownfield Medium Term Planning Allocated Sproughton developers JG. Potential intermodal site located on application for residential B1,B2,B8 Road, Babergh the south western fringe of Ipswich and lies adjacent development refused on to the A14 with direct access to Junction 54. The site appeal. Subject to judicial has the benefit of being served by a dedicated rail review. head, in proximity to the port. The site was the subject of a planning appeal – and now judicial review – against a refusal of permission for a residential led development 5 Cuckoo Farm, South of the A12, east of the Cuckoo Farm 20 Greenfield Medium Term Proposed A12, Colchester Community Stadium development Strategic Employment Zone B1,B2,B8 6 Trinity 2000, A joint venture between Trinity College and Gazeley 10 Greenfield Short Term Allocated Felixstowe – for up to 50,000m2 of port related warehousing. B1, B2, B8 Adjacent to the A14 with direct access to Junction 61 and also adjoins the Felixstowe railway line to the Planning north. The site forms an extension to the existing Consent Trinity Park Employment Site

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7 Ransomes Adjacent to the A14. An extension of mixed B1, B2 17 Greenfield Short Term Allocated & Europark and B8 development. The final phase was launched outline Extension, in 2004 - already substantially developed. consent for Ipswich B1, B2 & B8 9 Suffolk Business Adjoins established commercial area of Bury. Some 68 Greenfield Short Term Allocated Park Extension, high quality development already taken place – B1,B8 Bury St Edmunds expansion targeted primarily for B1. 10 Helions Business Haverhill section of Helions Park. Well located on the 15 Greenfield Short Term Allocated, Park, Haverhill A1017 and A1307 B1,B8 with planning permission 11 Various other Former Project Furniture site and other potential sites 12+ Brownfield Not currently available Allocated sites at Haverhill at Haverhill. Development would be most prominent and B1,B2,B8 in landscape terms. Potential for serving Stansted Greenfield Airport 12 Whersted site, nr Existing office site owned by Eon – including listed 11 Brownfield Occupied / Relocating – B1,B2,B8 Orwell Bridge, bldg. Poor site access but close to A14 / Bridge may be available for Babergh development 14 George Lambton Occupied by leisure facility, relocation of which is 10 Greenfield Not currently available Allocated Playing Fields, dependent on lottery grant. B1,B2,B8 Newmarket 18 Orion Court, Expansion of existing industrial area. Snoasis 20 Greenfield Medium Term Small portion Great Blakenham development proposed nearby awaiting decision by is allocated, Secretary of State – may impact on demand for site. but B1, B2 and B8 permitted Peterborough 15 Various allocated Several Brownfield sites located at the Hampton GEA 45 Brownfield Short - Medium Term Allocated brownfield sites at B1,B2,B8 Hampton 16 Cygnet Park, Access to A1(M). Established employment area near 13 Brownfield Available land in serviced Allocated and Hampton build out. plots plus site is currently Outline available for employment planning uses. permission for B1 and B2

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17 Eastern Industry, Access to A1(M). Established employment area near 10 Greenfield Short - Medium Term Allocated Third Drove build out. B1,B2,B8 20 Gateway Site, Site with existing consent for logistics - 93,000m2 of 48 Greenfield Short - Medium Term Planning Peterborough warehousing consent for logistics

Cambridgeshire 22 Alconbury Airfield Former airfield, now available for reuse 41 Brownfield Short Term B8 Application submitted for 650,000 sq m of multi nodal distribution space. 23 Riversfield, Little North of St Neots. Infrastructure has commenced 10 Greenfield Short Term Planning Paxton permission for B1/B2/B8 24 Bell Farm, South of St Neots Fully serviced park, with existing 10 Greenfield Short Term Allocated and Priorsgate, St facilities near A1 consent for Neots B1/B2/B8

Bedford 25 Thurleigh Airfield Former airfield, now available for reuse 100 Brownfield Allocated B1,B2,B8 26 Stratton Park 20 Greenfield Allocated Phase 4, B1,B2,B8 Biggleswade 27 Cardington Site comprises former hanger of 19,880 sq m sq ft 12 Brownfield Available and serviced to Allocated B1c, Hangar Site, and adjacent development land site boundary. Scope for B2, B8 Bedford up to 23,225 sq m 28 Cambridge Road Greenfield site 11 Greenfield Available, although in Allocated B1, (South), Bedford current use B2, B8

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Table 6.3b Indicative Long List of Potential Strategic Logistic/Distribution Sites in East of England Region – Other Sites With No Planning Status

Site Site/Location Description Area Site Type Stage in Development Planning No. (Ha) Process Status Haven Gateway and rest of Suffolk 1 Land at Owned by Trinity College, subject of LDF submission 75 Greenfield Long Term subject to Agricultural Innocence Farm, for employment uses acceptance by the District land A14, Felixstowe Council 4 Land at Fagbury Owned by Trinity College, subject of LDF submission 18 Greenfield Long Term subject to Agricultural Cliff, Trimley, for employment uses acceptance by the District land Felixstowe Council 8 Redevelopment Redevelopment of existing rail sidings – no specific Not specified - Brownfield Short Term Not allocated of existing rail site yet identified. Site likely to be in vicinity of A14. >15ha sidings at Bury St Potential to combine with existing aggregates Edmunds distribution. 13 Land off Mill Planning application for intermodal facility submitted 38 Greenfield Medium - Long Term Agricultural Lane, Stowmarket in 2007 and currently undetermined land

19 Magna Farm, Intermodal proposal for 370,000 m2 of warehousing 100 Greenfield Medium - Long Term Not allocated Peterborough and distribution centre currently in pre-application Half of site stage has permis- sion for clay and gravel extraction 21 Great Haddon Adjoins the Gateway Site. Current Draft Master Plan 35 Greenfield Medium - Long Term Agricultural Employment Area gives Notional Employment Allocation land

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6.4 Site Screening to Create a Short List of Sites The sites listed in the long list above were selected on broad criteria without in-depth consideration of the sites’ specific attributes or spatial relationship to the port. The next step of the evaluation was to narrow the field of sites represented in the long list to those most suited to port-related uses. More detailed information on sites and their current status was gathered through conversations with local authorities. The following considerations were taking into account while creating a short list of sites from the long list:

Development status – Information gathered from the secondary sources that formed the original pool of potential sites was often several years old. In that time a number of the identified sites had been largely developed or had followed a development pattern which was not conducive to port-related uses.

Definition of the port-centric zone – As detailed in Annex D, due to the economics of the cost of a shunt, a radius of 30-miles around the port was identified as the port centric zone. Beyond this zone, sites are unlikely to be used for port centric uses. As a general principle in logistics, containers will either be devanned in the port centric zone and then distributed to their final destinations or be shipped to distribution centres closer to their final destination or central facilities. As explained in Annex D, these latter facilities are unlikely to be located within our study area. Due to these established logistics patterns, the focus of our attention has been the port centric zone. Several sites beyond the 30-mile limit have been included because they have been put forward as port centric sites.

These criteria were applied to the long list to narrow the potential sites to those most suitable for port-related uses.23 It allowed the initial long-list of 28 sites, to be narrowed to a shortlist of 9 sites. Shortlisted sites are shown on Tables 6.4a and 6.4b (divided, as was the long list, by planning status) and Figure 6.2. Table 6.5 provides a summary of the sites by planning status and possible development timeframe.

23 The sites at Peterborough are not included in the short list. However, while not offering port centric opportunities, these sites do present possibilities for warehousing and distribution centres that compete with facilities currently located further away from the port predominantly in the “golden triangle” area. As such, based on our demand calculations in Section 5, they are competing for a much larger and different pool of container traffic than that handled off-port within the port centric zone (i.e. the 70% of container traffic that currently leaves the port by road and rail and leaves the study area versus the 30% that is will be handled by off-port facilities within the 30-mile radius of the port). These sites must be considered in the context of UK-wide logistics networks and availability of competing sites outside the study area.

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Figure 6.2 Shortlisted Sites

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Table 6.4a Short-list of Sites – Allocated Sites

Site Site/Location Area Planning Status No. (Ha) 2 Shepherd's Grove, Stanton 53 Allocated B1,B2,B8 3 British Sugar, Sproughton Road, Babergh 31 Allocated B1,B2,B8 5 Cuckoo Farm, A12, Colchester 20 Proposed Strategic Employment Zone B1,B2,B8 6 Trinity 2000, Felixstowe 10 Allocated B1, B2, B8 Planning Consent 9 Suffolk Business Park Extension, Bury St 68 Allocated Edmunds B1,B8 18 Orion Court, Great Blakenham 20 Small portion is allocated, but B1, B2 and B8 permitted

Table 6.4b Short-list of Sites – Other Sites With No Planning Status

Site Site/Location Area Planning Status No. (Ha) 1 Land at Innocence Farm, A14, Felixstowe 75 Agricultural land

4 Land at Fagbury Cliff, Trimley, Felixstowe 18 Agricultural land

13 Land off Mill Lane, Stowmarket 38 Agricultural land

Table 6.5 Supply by Planning Status and Possible Development Timeframe

Planning Consent Allocation No Planning Status

Short Term 10 ha 68 ha (0 – 5 years) (Site 6) (Site 9) Medium Term 53 ha 71 ha 38 ha (5 – 10 years) (Site 2) (Sites 3, 5, 18) (Sites 13) Long Term 93 ha (10+ years) (Sites 1, 4) TOTAL 63 ha 139 ha 131 ha

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6.5 Detailed Criteria for the Appraisal of Potential Sites and Locations The 6 sites listed in Table 6.4a meet general criteria for port-related uses and therefore can be considered a fair rough assessment of the minimum supply of available land currently eligible for port-related uses. However, the likelihood of these sites advancing further toward the development of port-related uses will be determined by a series of more specific strengths and constraints that affect the desirability of their development both for potential developers and local authorities.

A detailed appraisal of the shortlisted sites has been carried out for a number of purposes: ƒ To provide further information on the short-listed sites; ƒ To provide a basis for comparing their suitability; ƒ As a demonstration of the information to be gathered as a first step in considering the suitability of any site; ƒ As a point of comparison for evaluating new sites for port-related uses as they come forward during planning processes.

A complete set of appraisal criteria is included in Annex G. An evaluation of the shortlisted sites is also included in Annex G along with the other sites listed in Table 6.4b.

The assessment criteria used in this study is based on research drawn from a series of studies and sources as follows: ƒ The DCLG Guidance issued in December 2004 on Employment Land Reviews (ELRs) undertaken by Local Planning Authorities. Required compliance with this guidance has set the direction for the preparation of the employment land aspects of the new Local Development Frameworks. The Guidance includes a framework for site assessment criteria and a description of how individual indicators should be developed on these criteria; ƒ Regional level studies undertaken by the consultants and others, including comprehensive land supply database and classification studies carried out in the North East, East Midlands and West Midlands regions; ƒ The DTZ Employment Land Study which includes search criteria used to appraise and prioritise employment land supply in the Haven Gateway sub- region; ƒ Various logistics sector studies and research undertaken by the consultants and others which have examined the requirements for the location and development of logistics sites; ƒ The results of the stakeholder consultations which included questions on site location and operational criteria to meet future need.

When developers and occupiers are selecting new sites for logistics facilities they are making two different types of decisions: ƒ Broad locations are identified for large scale logistics; and ƒ Individual site characteristics are assessed within these locations

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Whilst these decision criteria may overlap, we have taken account of both decision- making levels in developing the appraisal criteria. Following the frameworks developed in the DCLG Guidance and other studies, the criteria list is therefore presented in six main indicator groups (see Annex G): ƒ General Site Indicators ƒ Operational Accessibility ƒ Workforce Accessibility ƒ Environmental Qualities and Constraints ƒ Site Development Constraints and Requirements ƒ Planning Status

As recommended by the Guidance, within each of these indicator groups, specific measurable indicators have been identified which are relevant to the assessment of port-related logistics and container storage sites. The importance of the relevant individual indicators was reviewed and ranked by the consultants following consultations with local planning authorities. These indicators and rankings should be used be used in the detailed evaluation of proposed logistics sites as they come forward.

One key indicator group that has not been included in the site appraisal criteria is marketability. The cost of land is particularly important when considering port centric logistics uses as the financial viability of a site is dependent on finding a balance between the cost of land and proximity to the port and transportation infrastructure which determines the cost of moving containers to and from the port. Not enough information was available on the costs of sites at this stage. However, in interviews with stakeholders, high land values around the port, linked to the relatively small handful of landowners in the region, were identified as a reason why otherwise suitable sites in the port vicinity have not yet been developed. It is our recommendation that market availability assessments be done on sites proposed for port-related uses as part of upcoming LDF processes.

Separate from the detailed appraisal, a transport assessment was carried out on shortlisted sites as part a rail and road transport review to provide a first phase assessment of their potential. It is included in Annex F. It provides a summary of sites based on road and rail.

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7 SUMMARY AND RECOMMENDATIONS

7.1 Off Port Land Demand and Supply Balance This section provides an overall comparison of land supply, based on the site search and short-listing in Section 6, with the estimates of additional off-port land demand at three points in time: 2013, 2018 and 2023.

In Table 7.1, off port land demand totals are provided for both Scenarios A and B using both methodologies used in Section 5. These totals are broken down further into the land demand for open container storage, warehousing and ancillary uses based on the existing proportion of current land uses.

In Table 7.1 land supply is separated into three categories: sites with existing permissions for port-related uses, sites without consents but allocated for B8 uses, and “other” sites without planning status for port-related uses, as identified in Section 6.4 (see Tables 6.4a, 6.4b and 6.5). It should be noted however that these “other” sites are a sub-set of a larger potential Greenfield land bank within the 30 mile port centric zone and further consideration may be given to other opportunities if the potential land bank is taken up.

Finally, for comparison purposes, Table 7.1 also identifies the quantum of existing land supply currently meeting port-related operations for the area within 30 miles of the port. Existing operations beyond 30 miles have not been quantified as the evidence suggests there is less significant impact on meeting land demand from the port from these sites.

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Table 7.1 Additional Land Demand and Future Supply: 2013, 2018 & 2023

2013 2018 2023

TOTAL EXISTING IN USE (ha)

Total Existing 156.5 156.5 156.5 Open Storage 49.0 49.0 49.0 Warehousing 107.5 107.5 107.5

DEMAND (ha)

Total Demand (Method 1, Scenario A) 26.7 71.1 114.5 Open Storage 7.3 19.4 31.2 Warehousing 15.9 42.5 68.4 Ancillary 3.5 9.2 14.9

Total Demand (Method 1, Scenario B) 3.7 26.2 43.7 Open Storage 1.0 7.1 11.9 Warehousing 2.2 15.6 26.1 0.5 3.5 5.7

Total Demand (Method 2, Scenario A) 48.6 84.6 116.4 Open Storage 13.2 22.7 31.7 Warehousing 29.0 50.7 69.5 Ancillary 6.3 11.2 15.2

Total Demand (Method 2, Scenario B) 26.7 47.9 63.1 Open Storage 7.3 12.9 17.2 Warehousing 16.0 28.7 37.7 Ancillary 3.5 6.3 8.2

SUPPLY (ha)

Short Term Medium Term Long Term

Total Supply (cumulative) 78.0 240.0 333.0 Planning Consent 10.0 63.0 63.0 Allocated 68.0 139.0 139.0 No Planning Status ---- 38.0 131.0

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7.2 Summary The comparison of additional demand and future allocated and potential supply highlights some important overall conclusions: ƒ Using the two scenarios elaborated in Sections 4 and 5, port growth forecasts show that container volumes will increase by between 12-25% in the period from 2006 to 2013 and between 32-68% in the period from 2006 to 2023. This produces an additional demand for land of between 4 - 49 ha by 2013 and between 44 - 116 ha by 2023 depending on the method and scenario adopted. (Scenario Aii would have the impact of increasing demand in the years 2010- 2012) ƒ The method presumes that growth of off-port activities will reflect this increase in volume and that the growth that does occur will be similar in nature to what currently exists around the port – with the possible caveat that port centric logistics activities may grow at a faster rate to handle a larger share of this volume. Given this caveat, the ratio used to determine the volume handled within the study area, and particularly within 30 miles of the port, is cautious in that it is more likely a slight overestimate than an underestimate. Safety here makes sense given the goal of long term port competitiveness and supporting value added activities in the study area ƒ The sensitivities inherent in the assumptions made while modelling future land demand mean that the land demand figures provided in this study are approximate. However, the nature of these sensitivities is such that changes to assumptions are unlikely to cause major changes in the projected demand for land. Thus, the risk of significantly underestimating the land requirement is deemed low. ƒ The summary comparison of demand and supply indicates that the total available land supply (with a planning consent or allocation for B8 uses) is 202ha. This exceeds increases in demand under any scenario and should be equated with what will be on the market at any given time. ƒ This supply rises to 333 ha if all sites, included those without planning status and listed in Table 6.4b, are included. ƒ The demand and supply balance indicates that if all the short-listed sites were developed there would be more than enough land to meet demand in the short, medium and long term. However, these results need to be considered in the context of the market and planning realities. The number of sites is small and even smaller when considering how they come onto the market over the timeframe examined in the study (for example there are only two sites that are identified as developable in the short term). Some of these sites will likely not be developed for port-related uses for a number of reasons:

− A number of the sites have been marketed for these uses for some time without any take up. Lack of demand may be one explanation. However, it may also be that they have not passed the marketability test either because of costs, issues around tenure, or being an appropriate match for port-related businesses.

− Some of the allocated sites may be developed for other employment uses.

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− Unallocated sites may not meet the planning requirements necessary for development, due to restrictions such as environmental constraints. ƒ Therefore, it is a fair assumption that these sites alone may not meet growing demand for off-port land. It is also likely that other sites may come forward that are equally or more suitable for port-related development. These sites should be assessed on their own merits and with reference to the logic and criteria developed as part of this study – and in comparison with some of the options identified. ƒ The main issues for identifying future land supply sufficient to meet additional demand will be qualitative rather than quantitative including:

− The need to consider potential sites to provide more comprehensive rather than piecemeal solutions and provide better size and shape sites;

− The need to consider employment land policies for these sites more closely to see whether they have more potential in other employment uses; and

− To break down the short and long term supply more carefully.

7.3 Recommendations and Next Steps This study should be used to inform the preparation of Development Plan Documents (DPD) produced by local planning authorities within the local development framework (LDF) planning process and provide part of the evidence base to support land allocations and potential sites that would be suitable to support the sustainable expansion of the Port of Felixstowe and related port uses. It is one input to the process, as set out in PPS12, but is not likely to be sufficient on its own nor is it intended to replace the consideration of other evidence provided to the LDF processes which will be taken forward by the respective Local Authorities.

A second use of this study is to provide one platform to support the sustainable growth of the Port of Felixstowe and the Haven Gateway sub-region. It can assist with guiding wider port planning and be integrated into the HGP activities focused on improving economic performance of the sub-region and developing new value-added related logistics services complementary to the port; indeed one emphasis of this study has been to facilitate and support further development of port centric logistics services. Port centric services make Felixstowe more attractive to shipping lines as well as create new employment and value-added activities.

A number of recommendations are suggested to take the study results forward. These were discussed at the workshop and provide a basis to improve future port and logistics planning in the sub-region. They are: ƒ Plan for growth (success) and allow for new land to be brought into the pipeline if eligibility criteria are satisfied – ensure flexibility and choice; ƒ Ensure that there is sufficient coverage of land in the pipeline versus demand – this can avoid risks of undersupply which may have risks of harming port and logistics performance and thus cause wider economic repercussions;

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ƒ Provide opportunities for value-added logistics service growth and warehousing proximate to the port – overall it is reasonable to provide relative priority to near port and larger sites; ƒ Encourage and agree on a co-ordinated approach among Local Authorities across the study area to plan for port and related uses, with the HGP one forum through which this can be developed; ƒ It is useful to monitor market changes and adjust plans on a regular basis – simple yearly updates can be complemented by revised forecasts every 2-3 years (this is the process developed in other port areas); ƒ Put in place a mechanism – e.g. HGP as one option – to advance thinking on collaboration and key priorities for the public and private sectors to take forward and implement common user logistics solutions – get scale and efficiency economies and more sustainable solutions acceptable to the wider community.

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