SECOND CONTAINER PORT ADVICE Consultation summary 2 Infrastructure Second Container Port Advice Contents

Introduction 4

What we did 6

Feedback and submissions 6

Stakeholder meetings 7

Workshops 8

What we heard 9

Key themes from feedback and submissions 9

Feedback from workshops 12

Timing 12

Location 12

How we’ve used what we’ve heard 14

Another chance to have your say 15

Appendix one – Additional factors identified through consultation 17

About us 23

3 Introduction

In May 2016 the Victorian Special Minister of State asked In 2016, we undertook the first phase of engagement Infrastructure Victoria to provide advice on the need, with local communities and stakeholders, focused timing and location of a second container port in Victoria on the process to prepare the advice and the key factors – at either a Hastings or Bay West location for investigation. You can read the Minister’s full Terms of Reference on This report summarises the key themes from this first our website at infrastructurevictoria.com.au/second- phase and discusses how what we heard has influenced container-port. how we are preparing our advice. Our advice on planning for Victoria’s future ports capacity, Together with this report we have now released our which is due to the Minister by May 2017, takes into evidence base for consultation in March 2017. account the economic, environmental and social impacts of developing a new port. Consistent with our approach, and the Terms of Reference for the advice, Infrastructure Victoria is committed to transparent engagement with the community, industry and other stakeholders. This engagement will assist us to promote a deep, informed discussion, while building consensus on the key issues of public importance, policy priorities, options and trade-offs.

4 Infrastructure Victoria Second Container Port Advice 5 What we did

In September 2016 Infrastructure Victoria released a Feedback and submissions discussion paper, Preparing advice on Victoria’s future ports capacity. The paper outlined Infrastructure Victoria’s The release of the discussion paper Preparing advice scope and approach in preparing advice on Victoria’s on Victoria’s future ports capacity marked the start of a future commercial port capacity and described: four week formal consultation period. An online feedback form was available to complete on Infrastructure Victoria’s • the proposed process for preparing our advice consultation website from 1 September 2016 until • key factors and drivers of change likely to affect 30 September 2016. further development at the , Bay West and Hastings Questions in the feedback form included: • the additional work we are likely to undertake • Have we missed any key factors that may influence to inform our advice. demand and capacity at the Port of Melbourne? The paper was used as a basis to seek input on our • Which key factors are likely to have the greatest process and whether we have identified the key factors influence on demand and capacity at the Port necessary for deciding when a second port will be of Melbourne? needed, where it should be located, and what should • What do you view as the key links and interactions drive these decisions. between key factors? • Do you think we have missed any key factors or issues for assessment of the sites? • Do you think there are any constraints to testing the key factors we have identified? • Do you have any information to help us build our evidence base? We received over 50 feedback forms from local councils, peak bodies, environment groups, community groups and individuals. Key themes from this feedback is available on pages 9-11.

6 Infrastructure Victoria Second Container Port Advice Stakeholder meetings

As part of the consultation process Infrastructure Victoria also held a series of meetings in the second half of 2016. Meetings were held with:

Avalon Corridor Planning Port of Hastings Development Authority Commissioner for Environmental Sustainability Port of Portland Customs Brokers and Forwarders Council of Conservation Council Transport for Victoria Port Phillip Sea Pilots Western Distributor Project Team Ports Australia Fisheries Victoria Salta Properties Plan Melbourne Seafood Industry Victoria DP World Strategic Maritime Group Drewry Transport Safety Victoria Environment Protection Authority VicRoads Ports Victorian International Container Terminal Fishermans Bend Taskforce Victorian Planning Authority Institute for Supply Chain and Logistics Victorian Ports (Melbourne) Linfox Victorian Regional Channels Authority Maribyrnong Truck Action Group Victorian Transport Association Melbourne Water Victorian National Parks Association Patricks Western Port Biosphere Reserve Port of Brisbane Western Port Preservation Council Port of Melbourne Corporation Woolworths Supermarkets Port of Melbourne (lessee)

Meetings were focused on the information and questions included in the discussion paper. Key themes from this feedback are available on pages 9-11.

7 Workshops The key stakeholder workshops were facilitated by RPS, an independent consultancy, and were designed In November 2016, Infrastructure Victoria held five to hear the views and perspectives of individuals and workshops with key stakeholders and local communities organisations from a variety of backgrounds, sectors in and around Hastings, Geelong and Melbourne. and communities including: The purpose was to draw on local knowledge and • local government expertise to understand factors that are important • port operations and management to participants and whether any other evidence • logistics and freight or inputs should be considered in developing our • education, research and policy independent advice. • planning and economic development • environmental conservation and protection • Victorian Government departments and authorities. Two community workshops were held in Hastings and Hoppers Crossing. The focus of these workshops was to hear directly from the community near the Hastings and Bay West locations about what they thought the issues and opportunities of a potential port at these locations might be. A summary of what we heard from the workshops is available in the RPS Workshop Summary report available at yoursay.infrastructurevictoria.com.au/ports.

8 Infrastructure Victoria Second Container Port Advice What we heard

Key themes from feedback • There is sufficient yard space at the Port of Melbourne and submissions to support much more capacity. • There is the possibility of developing the Port of There was broad support for our approach and the key Melbourne land for residential or commercial uses in factors we are considering as we prepare our advice. the long term. However, there is likely to be sufficient land for development for at least 50 years within There were additional factors raised for us to explore. current redevelopment precincts such as Docklands, These are outlined in Appendix One together with a Fishermans Bend, Arden-Macauley, E-Gate and summary of how Infrastructure Victoria is taking these North Dynon. additional factors into account. In addition to the specific suggestions for additional key In relation to other Victorian ports factors, the following key themes also emerged: we heard:

• There are many options for relocating trades from In relation to the capacity of the Port Melbourne to other Victorian ports. This would free of Melbourne we heard: up space to increase the capacity of the Port of Melbourne, as well as providing an economic boost to • The major constraints at the Port of Melbourne are other Victorian commercial ports. This was discussed the quay line, the height of the West Gate Bridge, the particularly in relation to relocating the automotive size of the Swanson Dock turning basin and the width trade to either Hastings or Geelong, and the potential of the Yarra River and Swanson Dock. We heard that of relocating liquid bulk and break bulk from the Port Swanson Dock was more limited in accepting larger of Melbourne. ships than Webb Dock. Swanson Dock is already experiencing situations where stevedores have to In relation to future trade growth work together to manage arrival of the biggest ships because of the current width of the dock. The use and demand for container capacity of more powerful and manoeuvrable tug boats may we heard: increase the size of ships that can be accommodated at Swanson Dock. • Feedback differed on the likely future demand for container capacity, but there was awareness • To maximise the capacity at the Port of Melbourne of the importance of demand projections in shaping significant development would need to occur at Webb our study. Dock, because it can accept larger ships and does not face the height constraint of the West Gate Bridge. Rail • Some stakeholders argued that planning for a new capacity needs to be expanded and there needs to be port needs to begin soon to ensure Victoria is ready more focus on the optimisation of truck movements, for increased demand. Other stakeholders argued that including less ‘frustrated trips’ where trucks arrive the rates of container demand seen prior to 2008 are expecting to pick up a container but for a variety of unlikely to return. Future growth is more likely to be in reasons leave empty. line with GDP than be a multiple of GDP growth. • The transport networks around the Port of Melbourne are adequate, but a shift to night operations for transport companies is likely to be necessary as the port increases its capacity. The amount of trucks on roads in Melbourne’s inner west is likely to have a health and safety impact. This needs to be addressed, especially if the Port of Melbourne continues to grow.

9 In relation to the impact of future In relation to supply chains we heard: ships sizes and Port Phillip Heads • The logistics industry wants access to cheap, flat land we heard: that is close to good transport networks and the port. At the moment, the industry is shifting to the west • Shipping lines are already making enquiries about because of land availability and access to the M80 bringing larger ships – in the range capacity of Ring Road. There is more vacant land for industrial 8000-10,000 TEU – into the Port of Melbourne. development in the west than the south-east. Submissions differed on the size of ships likely to visit Melbourne in the future, but are consistent in • In relation to the impact on supply chains of a port suggesting Infrastructure Victoria needs an informed at either Hastings or Bay West, feedback focused and credible view on future ship sizes to inform on the impact of changed supply chains on their our study. current warehousing locations. Warehousing has a 15–25 year lifespan. Industry would like certainty • Some feedback argued it is important that a new port on port and transport planning so that it can make has capacity for much larger ships than are currently investment decisions. visiting Australia, perhaps up to the largest ships in the world today, of about 18,500+ TEU. On this basis, • Supply chains prioritise reliable and repeatable stakeholders argued that Hastings was a better option, trips, even if they are slightly longer. Some feedback because of the difficulty of ships this large accessing questioned the impact on supply chains if traffic the Port Phillip Heads. flows around the Port of Melbourne become more congested because of increased freight volumes • Other feedback argued that because of the relatively or a densification of urban development. small size of the Australian market, the largest ships in the world today were unlikely to visit Australia • A new port at either Hastings or Bay West needs to and that the current size of the Port Phillip Heads have sufficient road and rail infrastructure to support would be sufficient for a long time. efficient supply chains. Many stakeholders providing feedback focused on the need for rail to take a larger • Future technology may improve the manoeuvrability mode share as part of any significant expansion to of ships, meaning that bigger ships than anticipated the capacity of the Port of Melbourne. Submissions may be able to manoeuvre through Port Phillip Heads. overwhelmingly recommended that rail must be a • The cruise ship industry is growing and we need to significant consideration as part of any new port consider the projected increase in these accessing development. Exporters are more cost sensitive than the heads when we consider the amount of traffic importers, so access to rail and the cost of accessing that may want access through the Port Phillip Heads a new port must be considered in planning. in the future. • The government should prioritise the establishment of an integrated High Performance Freight Vehicle network to maximise the efficiency of Victorian supply chains. Current weight limits on the West Gate Bridge and the Bolte Bridge are preventing this from happening. The planned Western Distributor will help address some of these problems. State and commonwealth governments should be encouraged to take a national approach to freight supply chains and port capacity.

10 Infrastructure Victoria Second Container Port Advice In relation to environmental and social In relation to the economic impact issues of developing a port at either of different port locations we heard: Bay West or Hastings we heard: • There is an opportunity for a new port to create jobs • Developing a new port at either Hastings or Bay and generate related freight and logistics activity. We West will have significant environmental impacts. heard from groups in both Hastings and Bay West that these areas are economically depressed and would • The delicate state of the environment in Western Port benefit from the immediate and indirect benefits of could be upset by a port development at Hastings. a new port development. Some of the potential environmental issues raised as a result of a port development in Western Port • Feedback from local government and industry were damage to existing seagrass and saltmarsh, peak bodies focused on the importance of an the delicate nitrogen balance of Western Port, the efficient port and supply chain for a healthy economy. potential danger of oil spills to the health of the bay Local government feedback generally advocated for and damage to Ramsar treaty environmental values. the new port to be closest to their location, because of the increased employment and economic activity • Some of the potential environmental issues raised from a new port and ancillary business activity. as a result of a port development in Port Phillip Bay were the possible damage to reefs and bayside • Feedback noted the importance of the south-eastern beaches that could occur if further dredging of the region as a population centre and hub for economic Port Phillip Heads was necessary, the impact on activity, employment and consumption. important habitat for the Orange Bellied Parrot and the need to manage any impacts on Ramsar treaty In relation to Infrastructure Victoria’s environmental values. assessment approach in providing • There is an opportunity to set up a comprehensive advice we heard: monitoring framework for environmental indicators in Port Phillip Bay and Western Port. Beginning this data • Infrastructure Victoria should be clear about the gathering early would mean we are better prepared techniques it uses to assess when and where Victoria when it comes to seeking approval for a port in should invest in new ports’ capacity, including whether either location. economic or cost-benefit analysis is being undertaken. • Some of the potential social issues raised as a result • The assumptions Infrastructure Victoria is making of a port development in Western Port were the to prepare its advice should be clearly documented. impact on recreational fishing (particularly access around channels and port waters) and the impact on Phillip Island and Mornington Peninsula tourism. • A potential social issue raised as a result of a port development in Port Phillip Bay was the impact on recreational fishing, particularly for boats leaving the Werribee River boat ramp. Loss of access for recreational fishers was also raised as a significant concern in Western Port. • In relation to increasing the size of the Port of Melbourne, feedback focused on the social impacts of more trucks needing to access the port, and in particular the health and safety effects of a large number of trucks travelling on streets in Melbourne’s inner west.

11 Feedback from workshops

A detailed summary of what we heard from the workshops Location is available in the RPS Workshop Summary Report available at yoursay.infrastructurevictoria.com.au/ports. Workshop participants identified links between economic, transport, social and environmental considerations for Hastings or Bay West with concerns, issues, opportunities Timing and benefits to balance for each location. An overarching In relation to the timing of a second container port we point made by some participants at the sessions was that heard that the decision may be influenced by the following: Infrastructure Victoria could consider a container port at both Hastings and Bay West in the long term. • Physical constraints at the Port of Melbourne including landside constraints such as encroaching urban development and waterside constraints such as increasing ship sizes. • Economic constraints including the lease price of Port of Melbourne, which may cascade down to the consumer and affect Melbourne’s ability to remain competitive. • Social constraints and the acceptability of port operations in largely urban areas. Many participants cited the international trend of moving river ports out of cities. • Other participants suggested that the issue should be framed from a national perspective and should consider other freight and logistic mechanisms such as inland rail and coastal shipping.

12 Infrastructure Victoria Second Container Port Advice Some of the key issues and opportunities raised at the workshops include:

ECONOMIC TRANSPORT Participants felt a second port at either Participants felt a second port at either location would: location would: • create greater employment and • need to be supported by new road business opportunities for the area, and rail infrastructure. This was seen mainly from supporting freight as both positive and negative: industries and services – Positive: Bay West options • create opportunities for industries in the could leverage off existing area that would be complementary (such transport networks. as boat building and logistic industries) – Negative: wide road and rail • allow for the development of industries corridors could become barriers that may compete with current industries and dislocate communities in the area (such as agriculture, market gardens and tourism). This was seen • there was an emphasis on providing as both positive and negative. regions with greater certainty on land use and transport planning.

KEY THEMES AND CONSIDERATIONS

SOCIAL ENVIRONMENT

Participants felt a second container port Participants felt a second container in either location would impact on the port in either location could: amenity of the surrounding area including: • have negative impacts on Ramsar • the beauty of natural wetlands wetlands at either location at both locations • have negative impacts on the • general quality of the life and environment through dredging wellbeing enjoyed in both areas • particular concerns were raised • negative impacts created by port at the Hastings community session operations – air quality, noise nad about impacts in mangroves, seagrass, visual impacts penguins, seals, dolphins and whales • potential loss of community identity and general deterioration of the whole and damage to the social fabric bay ecosystem from the construction of both areas and operation of a container port. • recreational activities, especially fishing.

Source: RPS, Workshop summary report, 2016

13 How we’ve used what we’ve heard

Our process of engagement has been iterative. We used In relation to environmental and social considerations, what we heard from submissions to help shape the we have further investigated specific issues raised during stakeholder and community sessions and sought to confirm consultation, including the impact of port development on: or test information we received with stakeholders during • blue carbon in Western Port our one-on-one meetings. • tourism near both sites We received substantial feedback on the things we need • recreational fishing to consider in building the evidence base to support our • the likelihood of a significant environment adverse advice. This includes a number of reports on specific event, such as ships blocking the Port Phillip Heads environmental issues, employment and population • aquifers statistics for different areas of Melbourne, studies on • the nitrogen balance of Port Phillip Bay and transport links and options for port locations within Port Western Port. Phillip Bay and Western Port. All this information has been used as inputs in shaping our technical work. Appendix We are undertaking a broad strategic assessment of the One provides a summary of how Infrastructure Victoria is suitability of port locations at Bay West and Hastings. responding to additional factors that were raised for our The level of detail required for this assessment is different consideration during consultation. to the level of detail that would be required if we were project proponents, seeking environmental approval for While much of what we heard was covered by the a new port. Any further detailed work by a future project technical studies we had already underway, a number proponent would need to examine some of the specific of themes came up consistently enough to warrant issues raised in our consultation in even greater detail. Infrastructure Victoria commissioning additional pieces of work. In particular, we have commissioned further studies on: • the predicted future growth in ship sizes seeking to visit Australia and the impact on our work • a more detailed investigation of how to provide rail access to the Port of Hastings • a separate study into the final destination of imported goods (after the first stop of unpacking the container at a distribution centre), to ensure we have a full understanding of how supply chains work, including the final point of consumption.

14 Infrastructure Victoria Second Container Port Advice Another chance to have your say

Together with this report we have now released our evidence base for consultation. This includes a number of technical studies and a discussion paper explaining why the results of the studies are important in helping us prepare our advice to government. These documents form the evidence base which will underpin our advice. We are seeking submissions on our evidence base until Monday 3 April 2017. This is your chance to tell us: • whether we have the right evidence to help us prepare our advice • if there are any gaps in our evidence that we should consider • if there is any additional information to help us prepare our advice. We will also run a number of community drop-in sessions to discuss our evidence base during March 2017. You can find out more on our website yoursay.infrastructurevictoria.com.au.

15 16 Infrastructure Victoria Second Container Port Advice Appendix one – Additional factors identified through consultation

ADDITIONAL FACTOR INFRASTRUCTURE VICTORIA’S RESPONSE TECHNICAL REPORT

PORT OF MELBOURNE

The opportunity cost of using inner city We will consider the impact of the Port of Melbourne on To be provided with land for a port. adjacent land use as part of understanding the triggers the final advice for developing a second port. We did not estimate the value of the Port of Melbourne land for use as a residential redevelopment because it is not clear its current use as a port is not the highest and best use. There are a number of other precincts in metropolitan Melbourne available for redevelopment, for example Docklands, Fishermans Bend, Arden- Macauley, and E-Gate. If these precincts were to be developed first, it would be some time before the Port of Melbourne land was needed. There would also be significant costs to remediate the site. How will the growth of the west and We have considered future freight and transport supply Infrastructure Victoria potential projects such as the Brisbane chain investments as part of considering Second Container to Melbourne Inland Rail and the Western the future size of the Port of Melbourne. Port Advice TEU cost Interstate Freight Terminal impact on the assessment Port of Melbourne’s operations? Infrastructure Victoria Second Container Port Advice – Concept Options – Bay West and Hastings The attitudes and corporate plans of We have spoken to a number of freight and logistics Infrastructure Victoria the freight industry, including preferred companies as part of our initial phase of consultation. Consultation summary location of future warehousing and report. transport modes. The potential to move other trades away We have considered the need to relocate trades in Infrastructure Victoria from the Port of Melbourne for safety the Port of Melbourne to enable growth in container Second Container Port reasons (chemicals and crude oil) or handling capacity. Advice – Estimated to make more space for international Capacity of the Port containers. of Melbourne Consider the social and environmental We recognise that there is a tension between port To be provided with impacts of a large Port of Melbourne and residential uses, particularly in the inner west the final advice on the city of Melbourne. of Melbourne. We will consider how this tension could be managed as densification occurs in the inner west Infrastructure Victoria and the Port of Melbourne increases in size. Second Container Port Advice – Environment and Social Advice Consider imports and exports separately. We have considered demand forecasts for the Infrastructure Victoria following categories of non-containerised trade: Second Container Port motor vehicles, break bulk, dry bulk and liquid bulk. Advice container trade forecast for Victoria

17 ADDITIONAL FACTOR INFRASTRUCTURE VICTORIA’S RESPONSE TECHNICAL REPORT

Demand forecasts for non-containerised We have generated separate demand forecasts Infrastructure Victoria cargo. for exports and imports. Second Container Port Advice container trade forecast for Victoria Better understand the role of competition We have compared the cost of shipping a container Infrastructure Victoria between Australia east coast ports directly from Asia to the Port of Melbourne with the Second Container (Sydney, Brisbane, Melbourne). cost of shipping a container from Asia to Brisbane Port Advice TEU cost then land-bridging it to Melbourne. assessment The suitability of road and rail networks We have modelled the key intersections outside Infrastructure Victoria servicing the Port of Melbourne to the port gate, to understand how they perform Second Container Port service a much larger Port of Melbourne, as Port of Melbourne capacity increases. Advice Ports landside perhaps 8 million TEU. transport modelling

TRANSPORT CONNECTIONS

The impact of potential future carbon The likely future mode-share at the Port of Melbourne Infrastructure Victoria restrictions on the balance of current and at a new port are important considerations. We are Second Container Port freight operations, which are dominated ensuring that rail access is a part of the transport mix Advice – Estimated by carbon intensive road freight, rather for a new container port. Capacity of the Port than rail. of Melbourne Infrastructure Victoria Second Container Port Advice – Concept Options – Bay West and Hastings The feasibility of providing sufficient rail The provision of rail capacity, including upgrades to the Infrastructure Victoria capacity to either new port locations, existing network, will be a consideration in preparing Second Container especially Hastings. our advice. Port Advice – Concept Options – Bay West and Hastings Regional Rail East and Hastings Rail Link – Concept of Operations Report The feasibility of providing sufficient road The provision of road connections is a consideration Infrastructure Victoria capacity to either new port locations, in preparing our advice. Second Container especially Hastings. Port Advice – Concept Options – Bay West and Hastings The need for metropolitan intermodal Rail is an important consideration for our study, Infrastructure Victoria freight terminals and developing including for increasing the capacity of the Port Second Container Port metropolitan rail shuttles for moving of Melbourne and providing transport options Advice – Estimated containers beyond the new port location. at either of the two possible port locations. Capacity of the Port The ability of port location options to of Melbourne support a viable metropolitan intermodal freight terminal network should be Infrastructure Victoria considered. Second Container Port Advice – Concept Options – Bay West and Hastings The potential to use the Port of Brisbane We have compared the cost of shipping a container Infrastructure Victoria as Australia’s main port and bring directly from Asia to the Port of Melbourne with the Second Container containers to Victoria by rail. cost of shipping a container from Asia to Brisbane Port Advice TEU cost then land-bridging it to Melbourne. assessment The need to develop better transport The ability for exporters, including those based in To be provided with connections between Victoria’s major Gippsland, to access a port at either Bay West or the final advice international port (either the Port of Hastings will be included in our supply chain analysis Melbourne or a new port) and Gippsland. for the two locations.

18 Infrastructure Victoria Second Container Port Advice ADDITIONAL FACTOR INFRASTRUCTURE VICTORIA’S RESPONSE TECHNICAL REPORT

CONSIDERATION OF ALTERNATIVE LOCATIONS

Geelong should be considered as The Minister’s request specifically asks us to examine Infrastructure Victoria a location for the second container the suitability of locations at Bay West and Hastings. Evidence Base port because of the ability to utilise Discussion Paper infrastructure already in place and A preliminary assessment of the suitability of the Port provide an economic stimulus of Geelong indicates that the length of its channel A detailed investigation to the city. The advantages of and the presence of basalt means that the dredging was out of scope of Geelong are: required to facilitate a container port would be our study prohibitively expensive, especially when a nearby • local workforce with relevant skills solution is present at Bay West, without the additional • high quality existing motorway dredging costs. • standard plus broad gauge rail access to state and national networks • large under-utilised freight rail yards close to the dock. Widen the Bay West assessment to The Port of Geelong has a long channel with significant Infrastructure Victoria include the existing Port of Geelong amount of rock, which means any further dredging of Evidence Base region and the surrounding area, the channel so it could accept larger ships will be very Discussion Paper particularly the Corio and Moolap costly. The Port of Geelong has the potential to accept region including Point Henry Alcoa site. relocated trades from the Port of Melbourne, but is not A detailed investigation suitable as the location of a second container port. was out of scope of our study

THE PORT PHILLIP HEADS

The ability of Port Phillip Heads to have The capacity of the Port Phillips Heads is critical to Infrastructure Victoria an internationally acceptable channel understanding the ultimate capacity of the Port of Second Container Port for 14 metre draft vessels, for example Melbourne and the suitability of Bay West as a location Advice – Navigation 8000 to 10,000 TEU container ships, of a new container port. The results of our navigation Study according to international standards, simulation will help address this issue, as will work and the future traffic impacts of many to understand the likely future traffic volume through more ships wanting to access the Port the Heads. Phillip Heads.

The environmental, economic and Our hydrodynamics study considers the likely impacts Infrastructure Victoria social impacts of any required dredging on nearby bayside beaches of any potential changes Second Container Port at the Port Phillip Heads, including to the Heads. Advice – Environment community concerns. and Social Advice Infrastructure Victoria Second Container Port Advice – Hydrodynamics Infrastructure Victoria Second Container Port Advice – Geomorphology

What is the likely future ship size Forecasting the future ship sizes likely to visit Australia Infrastructure Victoria visiting Australia? is a key focus of our work. The result of this work Second Container Port influences the likely future size of the Port of Melbourne Advice – Estimated and the decision about whether Bay West or Hastings Capacity of the Port is more suitable. of Melbourne Container Ship Fleet Forecast and Maritime Economic Assessment

The accident and natural disaster risk We will consider this as part of the multi-criteria analysis Infrastructure Victoria of having two ports in Port Phillip Bay to assess the availability and suitability of the two port Second Container Port (both using the Heads), rather than locations. We have also examined the likelihood of a Advice – Navigation having redundancy through locating shipping incident blocking Port Phillip Heads. Study a second port in Western Port.

19 ADDITIONAL FACTOR INFRASTRUCTURE VICTORIA’S RESPONSE TECHNICAL REPORT

ENVIRONMENT AND SOCIAL

More detailed consideration of In relation to specific species, the environment Infrastructure Victoria environmental impacts, such as: and social study has investigated the impact of a Second Container Port development at either site on threatened species. Advice – Environment • the locally rare southern brown Detailed management plans go beyond the level of and Social Advice bandicoot detail we are undertaking in our study, but we recognise • road fatalities of wildlife (predominantly that these would need to be an important part of any Infrastructure Victoria swamp wallaby, koala, blue tongue further work to actually plan and develop a port. Second Container Port lizard and echidna) and the potential Advice – Hydrodynamics for robust wildlife crossings factored We have examined the potential impacts on seagrass and mangroves. Infrastructure Victoria in to transportation infrastructure Second Container Port • potential for the release of ballast Potential oil spills, blue carbon and coastal erosion Advice – Geomorphology water to also release pests are considered in our environment and social study. • seagrass meadows As with specific fauna species, we have only • mangroves (carbon sinks and erosion undertaken a desktop study. There would need prevention) to be much more detailed investigations as part • oil spill potential and impacts of any planning or approvals process. • the loss of blue carbon in Western Port as a result of dredging • coastal erosion and inundation of communities in Western Port.

Impact on penguins and tourists Tourism and recreational activities at both Bay West Infrastructure Victoria on Phillip Island. and Hastings are considered in our environment Second Container Port and social study. Advice – Environment and Social Advice

The potential social impacts, We will estimate the number of jobs that are likely to Estimates of job creation positive and negative, of a new port be created by building and operating a port at either to be provided with the development at either Bay West Bay West or Hastings. final advice or Hastings, including job creation, particularly for local populations. Infrastructure Victoria Second Container Port Advice – Environment and Social Advice How enhanced port infrastructure and Our port concept designs are at concept level. Design Our economic modelling associated freight infrastructure will assist of port infrastructure to minimise emissions and climate will cost vehicle in reducing our climate impact whilst impact would be considered at detailed design phase. emissions based on the enhancing liveability of Melbourne. total kilometres travelled for each port location. To be provided with final advice. The potential to enable growth of the We have used the Victorian Government’s ‘Victoria Construction and Gippsland Region which is best placed in Future’ population projections, along with existing operating job numbers to support future population growth metropolitan and regional planning policies, as the will be part of the of Melbourne and has a growing basis of our population and economic studies. We have economic assessment agriculture sector. investigated the number of jobs that are likely to be and be provided with created by building and operating a port at either Bay the final advice. West or Hastings. Actions to improve the sustainability We have undertaken projections of future container Infrastructure Victoria of the Australian economy such as on- shipping demand under a range of demand scenarios. Second Container Port shore plastic recycling and manufacture Detailed consideration of the specific impact of plastic Advice container trade to reduce the need for container shipping recycling and manufacture is beyond the scope of forecast for Victoria in the first place. our study.

SUPPLY CHAINS

The impact on transport infrastructure The shape of existing and future supply chains is an To be provided with of containers and goods movement over important consideration in our advice. We will develop the final advice road and rail must be considered as part separate possible supply chains for a port at either of the location selection criteria, including Bay West or Hastings, and check this against available where goods will be transported after industrial land and travel times and distances, to being unloaded. Costs of container understand the relative supply chain costs of different movement to and from the port must be port locations. considered a key factor to port location.

20 Infrastructure Victoria Second Container Port Advice ADDITIONAL FACTOR INFRASTRUCTURE VICTORIA’S RESPONSE TECHNICAL REPORT

The current and future distribution We will examine the current operations of supply chains To be provided with of supply chain and markets around servicing the Port of Melbourne. the final advice Melbourne should be a consideration. The location of empty container parks Empty container park operations and locations will be To be provided with and their role in the supply chain. considered as part of understanding the existing supply the final advice chains for the Port of Melbourne. Strategic shape of the future city – where We have examined the population forecasts for To be provided with will the new industries and people that Melbourne, and the amount of industrial zoned land, final advice will send and receive containers be? at a high level to inform our supply chain investigations How easy will it be to move containers for both Bay West and Hastings. from port options to the next stage in the supply chain in the city of the future?

IMPACT ON EXPORTERS

The impact on the regional economy, Exporter access to a second port has been considered, Infrastructure Victoria particularly exporters and new industries. particularly the need to have access to rail. Second Container Port Advice – Estimated Capacity of the Port of Melbourne Infrastructure Victoria Second Container Port Advice – Concept Options – Bay West and Hastings The impact of the second port on Exporter access to a second port has been considered To be provided with existing and future freight networks, as part of examining supply chains for a port at either the final advice particularly for freight from Gippsland, Bay West or Hastings. South East Melbourne, Dandenong, Mornington Peninsula and Tasmania.

CONCEPT DESIGN

Provide a reasonable estimate of the We have provided a port concept for each location, Infrastructure Victoria future land required to be set aside for including the area required for the terminal areas and Second Container future port development at either Bay transport corridors. Port Advice – Concept West or Hastings. Options – Bay West and Hastings Existing land use impacts beyond just Our concept designs examine land use impacts of Infrastructure Victoria the port and its immediate environs, the port environs and required transport corridors. Second Container including transport corridors. This includes nearby land uses, for instance the Port Advice – Concept Western Treatment Plant within the Bay West Options – Bay West study area. and Hastings The relevance of the substantial Special The Special Use Zone has been considered as part Infrastructure Victoria Use Zone land in Hastings. of detailing our concept design for Hastings. Second Container Port Advice – Concept Options – Bay West and Hastings Infrastructure Victoria Second Container Port Advice – Environment and Social Advice Economic benefit opportunities as A consideration in our study is maintaining the efficiency Infrastructure Victoria well as cost implications. As Victoria’s of Victoria as a freight and logistics hub, to help support Second Container population of 6 million is projected to top access to imports for consumption and manufacturing Port Advice – Concept 10 million over the next 35 years, there inputs, as well as access to foreign markets for Options – Bay West will be strong business growth. How will Victorian exporters. and Hastings the container port location best support this growth? As part of our supply chain analysis, to be provided Infrastructure Victoria with our final advice, we will undertake a high level Evidence Base assessment of the adequacy of land available for freight Discussion paper and logistics purposes in metropolitan Melbourne, linked with future population forecasts for Melbourne.

21 22 Infrastructure Victoria Second Container Port Advice About us

Infrastructure Victoria is an independent advisory body which began operating on 1 October 2015 under the Infrastructure Victoria Act 2015. It has three main functions: • preparing a 30-year infrastructure strategy for Victoria, to be refreshed every three to five years • providing written advice to government on specific infrastructure matters • publishing original research on infrastructure-related issues. Infrastructure Victoria will also support the development of sectoral infrastructure plans by government departments and agencies. The aim of Infrastructure Victoria is to take a long-term, evidence-based view of infrastructure planning and raise the level of community debate about infrastructure provision. Infrastructure Victoria will not directly oversee or fund infrastructure projects.

Photo credit: HiVis Pictures/Peter Glenane/Port of Melbourne Corporation.

23 This publication may be of assistance to you, but the State of Victoria and its employees do not guarantee that the publication is without flaw of any kind or is wholly appropriate for your particular purposes and therefore disclaims all liability for any error, loss or other consequence that may arise from you relying on any information in this publication. You should seek appropriately qualified advice before making any decisions regarding your particular project. Printed by Infrastructure Victoria March 2017 © Copyright State of Victoria 2017

Except for any logos, emblems, trademarks, figures and photography this document is made available under the terms of the Creative Commons Attribution 3.0 Australia licence. It is a condition of this Creative Commons Attribution 3.0 licence that you must give credit to the original author, who is Infrastructure Victoria. This document is also available in PDF and accessible Word format at infrastructurevictoria.com.au. ISBN: 978-1-925632-24-8