Department for Transport
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Fitzpatrick announces £67 million to cut freight emissions, congestion and hauliers' costs

Fitzpatrick announces £67 million to cut freight emissions, congestion and hauliers' costs

DEPARTMENT FOR TRANSPORT News Release (145) issued by COI News Distribution Service. 11 September 2008

Transport Minister Jim Fitzpatrick today announced a £67m boost to the Sustainable Distribution Fund that will help the freight industry reduce costs and cut emissions.

The money will be targeted at increasing the use of rail and water transport where current schemes support the removal of over one million lorry journeys each year. It will also be used to help hauliers and freight operators cut costs and be more fuel efficient, reduce emissions and cut road congestion.

Freight Best Practice is one of the programmes to benefit, with funding increasing from £1.2 million to £1.5 million a year. Between 2005 and 2006 the industry saved £83 million with the help of the scheme, and saw CO2 savings of 240,000 tonnes.

Jim Fitzpatrick said:

"This £67 million is a vote of confidence from the Government in the freight industry. As more freight is transported by rail or water it will bring clear benefits for the economy, the environment and other road users.

"We want to help hauliers and van drivers continue to improve their operational efficiency and reduce costs. Freight Best Practice and smarter driving techniques have already helped companies make real savings. We are making these more widely available so that more businesses can benefit."

Since it started in 2003, the Safe and Fuel Efficient Driving (SAFED) programme has given around 12,000 truck drivers and 8,000 van drivers training in how to save fuel and improve driving techniques. It focuses on simple measures, such as watching speeds, accelerating and braking more smoothly, and checking tyre pressures. Van drivers who completed the course achieved an average 16% reduction in fuel use on the day.

More importantly, long-term fuel savings can also be significant. Drivers from major freight haulier Turners (Soham) Ltd reported fuel consumption savings between 5% and 10% after using the SAFED course.

Van Best Practice received £300,000 from this year's Sustainable Distribution Fund, and this is set to double to £600,000 a year as a result of today's announcement. A new Van Best Practice programme will also be funded to 2011, with thousands more drivers and companies set to benefit from efficiency best practice information.

Notes to Editors

1. About Freight Best Practice

Freight Best Practice provides free information to help freight operators improve operational efficiency. Funded by the Department for Transport, it offers a range of free guides, case studies, newsletters, videos and software covering:

Saving fuel
Developing Skills
Equipment and Systems
Operational Efficiency
Performance Management

Over the last year the programme has distributed almost 200,000 guides free of charge to the freight industry.

Van Best Practice is being developed to provide similar material targeted towards the Van sector.

Visit the website at or call the hotline on 0845 877 0 877.

2. Sustainable Distribution Fund - New Funds

The Sustainable Distribution Fund provides support for a number of schemes that focus on improving the efficiency of freight transportation and reducing the number of large freight vehicles on the roads. The aim of these programmes is, where practical, to reduce CO2 emissions, accidents, congestion, noise and pollution associated with the transport of goods.

Table 1 - Sustainable Distribution Revenue Funding

Year                             2008-09£m     2009-10£m  2010-11£m
      Previous Research & Sustainable  22.8          23.4       24.0
      Distribution Fund budget
      New funding                      2.0           2.0        2.0
      New Sustainable Distribution     24.8          25.4       26.0
      Revenue Budget
      Allocated to SDF                 23.3          23.4       24.0 

Table 2 - Current allocations of the SDF Revenue Budget (as at 1st September 2008)

Year                         2008-09£m     2009-10£m    2010-11£m
      Mode Shift 1                 17.8          16.4         0
      Other Programmes 2           3.4           3.3          1.5
      Total Allocated              21.2          19.7         2 

1 Schemes in the Rail Environmental Benefit Procurement Scheme, Waterbourne Freight Grant and Freight Facilities Grant. Note that the Fund does not fully allocate mode-shifty money for future years until late in the previous financial year. Funding for mode-shift beyond 2010 is subject to scheme review and will not be allocated at all until the middle of 2009.

2 Schemes include Freight Best Practice, Van Best Practice and SAFED Van (Safe and Fuel Efficient Driving). Budget also includes administrative costs.

Table 3 - Allocation of funds for Sustainable Distribution Capital Budget (used for Freight Facilities Grants)

Year      2008-09  2009-10  2010-11  2011-12   2012-13 2013-14 £m
                £m       £m       £m       £m        £m
      Total     4        7        10       16        20      25 

*New funding in bold

3. Sustainable Distribution Fund - June 2008 Bid Round, allocations for mode shift from road to rail

In June 2008, the Sustainable Distribution Fund made new allocations for rail mode shift provided by Rail Environmental benefit Procurement Scheme (REPS). The REPS funding awards were as follows:

Grant Recipient    Scheme       Traffic Details   Contract Value (£)
                                                      08/09        09/10
      EWS               REPS(I)        Containers     26,544      36,435
      EWS               REPS(I)        Containers     44,522      41,964
      EWS               REPS(I)        Containers     344,344     324,324
      EWS               REPS(I)        Containers     124,244     111,809
      EWS               REPS(I)        Containers     234,039     274,533
      EWS***            REPS(I)        Containers     58,800      0
      EWS***            REPS(B)        Steel          64,400      57,960
      Freightliner      REPS(I)        Containers     22,541      0
      Freightliner      REPS(I)        Containers     108,213     0
      TOTAL                                           987,647     847,025 

*** Provisional award - subject to detailed appraisal

* The traffic moved under each REPS contract is closely monitored. Where traffic levels have been lower than those in the grantees contract, reductions to the contract have been made. A total of around £278,000 was clawed back from contracts in June 2008 in order to release budget for reallocation. This process ensures the effective control of the budget and maximizes the amount of benefit that can be purchased through the scheme.

* The Department for Transport runs three schemes that facilitate the purchase of the environmental and social benefits that result from using rail or water transport instead of road. These are:

- Freight Facilities Grant (FFG): helps offset the capital cost of providing rail and water freight handling facilities.

- Rail Environmental Benefit Procurement scheme assists companies with the operating costs associated with running rail freight transport instead of road (where rail is more expensive than road).

- Waterborne Freight Grant scheme (WFG): assists companies with the operating costs, for up to three years, associated with running water freight transport instead of road (where water is more expensive than road). The three freight grant schemes are open to new applications. Applications are prioritised in a bid round process and further details are available on the Department's website. The REPS and WFG schemes are the subject of a review that will lead to a renewed state-aid application in early 2009.

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