P. Taneja

Implications of an Uncertain Future for Port Planning

The evolving function of a port, and many logistical, technological, and economic uncertainties under which it must operate, make the planning and design of these complex socio-technical infrastructures very challenging. A Master Plan of a port is the instrument by which the ports (expansion) strategy in the marketplace is defined. Therefore, a Port Master Plan needs to be dynamic and responsive to all external developments during its lifetime. The existing Master Planning approach is static and as a result it is poorly equipped to deal with many uncertainties in the port and shipping industry. A new approach is required. This article proposes an adaptive approach to planning that combines elements of Assumption-Based Planning (ABP), developed in the early 1990s, and Adaptive Policymaking (APM), developed in 2001. It identifies in a structured way the uncertainty in an existing plan, and subsequently improves its robustness and adaptability through taking actions either in the planning stage or by preparing actions in advance that can be taken as the uncertainties resolve themselves. The article illustrates this approach by applying it to the current plan for Maasvlakte 2, the ongoing port expansion of Rotterdam in The Netherlands. The value of this proactive and dynamic approach lies in its manner of dealing with uncertainties. It leads planners to recognize vulnerabilities in a plan and incorporate strategies for dealing with them, adapting to new developments, and building in capacity for taking advantage of new opportunities. The objective of using this adaptive approach is to realize a Master Plan robust across many futures, so that the port can meet the requirements of its stakeholders during its entire lifetime.

Dealing with uncertainty in design of port infrastructure systems

Ports exist by the grace of international trade. In the volatile and uncertain environment of globalization, liberalization, rapidly changing technologies, competition, threats and budgets, this trade is highly unpredictable and investments in port infrastructure therefore highly risky. The aim of this paper is to establish that the uncertainties due to these unexpected developments cannot be actively managed through traditional approach of scenario building for demand forecasting but only through flexible and evolutionary designs.

Role of Flexibility in Sustainable Port Development

Sustainability has become a high profile objective in all aspects of our lives, including the development of our infrastructures. Flexibility can enhance sustainability endeavors, yet its contribution is not clear to most. In this paper we investigate the role of flexibility in sustainable port development in order to promote its incorporation in port projects. We establish that the greatest payoffs from flexibility are achieved through initiating new life cycle for a capital intensive port infrastructure, though reuse of the elements and materials also contributes to flexibility. Reuse concurrently optimizes use of natural resources, limits waste and pollution in the environment, conserves energy, and thus limits the overall negative ecological impact. It also results in significantly lowers lifecycle costs. Thus flexibility helps achieve (long-term) financial viability in face of economic uncertainty, while reducing environmental and social impacts. Therefore, flexibility considerations are important during design, procurement, and contracting of engineering projects. The best way to redirect the choice of decision-makers towards flexibility is to make visible its long-term benefits, and its contribution to sustainability. We discuss some evaluation methods and propose that the quantitative methods are more likely make a case for flexibility.

Adaptive port planning using real options

The present volatile environment demands new ways of thinking and new tools for project planning, appraisal, and investment decisions for large scale port infrastructures. This paper proposes real options-based adaptive port planning which provides a framework for the planner to first identify critical uncertainties in the system and then, to examine, evaluate, and incorporate flexible options for handling these uncertainties. It includes a method for project evaluation, which enables the planner to make a trade-off between the value of incorporating flexibility and the cost of doing so, commonly termed real options analysis (ROA). The paper applies ROA to two cases in the port sector involving well known uncertainties, and demonstrates that in the face of uncertainty, a flexible option enhances the value of a project.

Planning and Management of Port Infrastructure Projects under Uncertainty

Most port infrastructure projects are large scale, and have a long life-time during which they are confronted with multiple uncertainties. Many of these can be dealt with reasonably using standard management practices. However, some uncertainties such as future demand, shipping traffic and future technology are difficult to forecast. If these uncertainties are not taken into account during planning, the resulting infrastructures may not be functional in a new or different future. This paper suggests that standard ‘project’ or ‘risk’ management practices are not adequate to deal with exogenous uncertainties which can form vulnerabilities for a project. It proposes Adaptive Port Planning (APP), an approach that offers a unified approach for strategic planning and risk management, and guides planners to systematically deal with uncertainties that appear over the lifetime of an infrastructure project. APP is a dynamic and effective management tool that can provide structure during realization and exploitation phases of a civil engineering project.

Container Transferium Rotterdam

Although most of the congestion is caused by commuters in the rush hours, the continuing growth in container traffic in the Port of Rotterdam is also contributing to the traffic-jams. Long traffic-jams on the main access road A15 to the port and at the sea terminals result in long transport times and an unreliable delivery of the cargo. A Container Transferium situated in the direct hinterland of the Port of Rotterdam is a new logistical concept which allows for large numbers of containers to be transferred by inland vessels in a single movement from the sea terminals at the Maasvlakte to the Transferium and vice versa. The Transferium can lead to an improved reliability thanks to a better planning of the inland ships or ¿shuttles¿ and a better handling of the trucks, which have no longer to deal with traffic-jams en route to sea terminals. The improved reliability is very important for the Container Transferium, and helps to justify the costs of the extra handling per container. The paper evaluates the potential of this new hinterland transport concept for the Port of Rotterdam.

Planning for an uncertain future: a case study

Without constant adaption, infrastructures tend to have a limited useful lifetime. This is because the demands placed on them as to function and use, are constantly changing. Through creating scenarios of alternate futures, it is possible to get insights into future opportunities and threats. Only then, it is possible to design infrastructure suitable for now as well as for a long-term future. This approach is given the name scenario planning. In this paper, we illustrate this approach through use of a case study. The expectation is, that as global oil reserves diminish, and oil trade patterns change, some refineries in Europe may close down. In Port of Rotterdam some (valuable) sites may become available, and can be put to alternate uses. The objective of the case study is to plan for a new function of such a site, which is suitable for the given location, is in line with the port vision and goals, and above all, a robust choice in any future that materialises.