Opinion: Port of Long Beach Will Be in Limelight When IANA Convenes in September

When the Intermodal Association of North America (IANA) stages its annual Expo in September, much of the limelight will be placed on the vibrant and fast growing host city of Long Beach.

The port here – and that of its San Pedro Bay neighbor Los Angeles – has been getting some bad publicity of late, but shippers recognize that it remains at the epicenter of global trade and a beacon of hope for the Pacific Rim. Now that the media focus has moved from dockside labor disruptions, it’s time to concentrate on the positive strides Long Beach is making as an environmental steward and generator of jobs.

The first job we should talk about, of course, is that given to newly-named chief executive, Jon W. Slangerup. He’s a veteran corporate executive with extensive experience in global logistics and environmental technologies, including a distinguished decade with FedEx Canada.

Transforming FedEx from a small regional domestic courier into Canada’s leading international express logistics company was one of his major career achievements, and he faces another daunting challenge today: port differentiation.

For Long Beach, that seems to be about establishing itself as the “greenest” port in the world. The Harbor Commissioners who selected Slangerup stated that his environmental track record was as important as his demonstrated leadership in developing advanced cargo-handling technology and infrastructure.

At the same time, commissioners have approved two incentives that officials expect will bring additional cargo to the port while also encouraging the use of air pollution-reducing shore power and on-dock rail.

The incentives are designed to help Long Beach compete with other West Coast ports that have already cut fees to grow their business. By encouraging the use of shore power or another approved system for cutting at-berth ship emissions, and by bringing more cargo via on-dock rail, the port’s programs seek to increase trade while also reducing air pollution.

In one incentive, the port will waive “dockage” charges – essentially giving free parking – for cargo ships that both slow down near the port and plug into shore power or use another approved pollution-cutting technology at berth. The Vessel Dockage Waiver Program augments other port and state programs that require and encourage slow-steaming and shore power.

The requirement is that each container must travel inland by “on-dock rail,” which helps to eliminate truck trips on local roadways by rail-hauling the containers from the wharf.

“We are really in competition with Vancouver, with Prince Rupert, with Lazaro Cardenas, where costs are much lower than San Pedro Bay,” says Commission president, Doug Drummond, referencing seaports in Canada and Mexico. “These incentives are important because they have to do with increasing cargo for our port and are hitting at a time when cargo across the board is increasing.”

The Vessel Dockage Waiver Program requires the vessel operator to slow down within 40 nautical miles of the port. The vessel operator is also required then to use shore power at berth or a certified alternative. By waiving the dockage fees in such cases, the port will forgo an estimated $3.3 million to $4.9 million a year.

But the measure is expected to attract additional cargo to Long Beach, and help to offset the costs with an increase in revenue from other fees. The incentive builds upon a port program in which most ships reduce speeds near port and a state program where at least half of all ships must use shore power or an equivalent at berth.

The Incremental On-Dock Intermodal Incentive Program will pay $5 per loaded 20-foot-equivalent container unit for new cargo above the 2013 baseline level that is also rail-hauled either out of, or into, the port. If vessels bring an additional 20 percent more cargo over two years, it would generate an additional $22 million in revenue.

Joni Casey, president and CEO of IANA, also acknowledges the strides that the Port of Long Beach has made in expanding its intermodal network.

“The San Pedro port complex is the epicenter for U.S. imports and is likely to remain so for the foreseeable future,” she says. “Long Beach is a natural venue for the Intermodal EXPO which will feature educational sessions focusing on the competitiveness of West Coast ports, the work that has been done by the POLB on chassis provisioning models and trucker terminal productivity issues.”

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