Port of Long Beach Balances Rapid Growth with Sustainability
The Port of Long Beach, California is booming, and it is preparing for even more growth despite trade tensions between the U.S. and China. It is also putting serious funding and effort into reducing its environmental footprint, striking a careful balance between rapid growth, competitiveness and community responsibility.
Long Beach is the second-largest container port in the U.S., right behind its next-door neighbor, the Port of Los Angeles. Long Beach had its busiest year ever in 2018, with total throughput of just over eight million TEU.
Port leaders say that the tensions between the Trump administration and Beijing were partly responsible for the boost: American importers front-loaded shipments from China in order to bring goods into the country early, ahead of an expected round of tariffs. But the trajectory of the port's growth suggests that its performance isn't primarily about short-term geopolitical factors. Its volumes have been growing steadily since 2010, when the economy began to recover from the Great Recession, and its most recent cargo forecast suggests that total TEU numbers at LA and Long Beach will more than double within two decades, from 17.5 million TEU to 41 million TEU.
To handle all of this new volume, Long Beach is spending billions of dollars to revamp its terminals and shoreside infrastructure. It is adding an $870 million on-dock rail terminal to cut down the number of trucks at its gates, building a replacement for the freeway bridge that serves its main terminals, and combining two of its existing terminals into a new 300-acre, all-electric facility.
At Pier B, a new rail yard will add space for rail car staging, which will improve efficiency by giving trains an out-of-the-way place to wait, according to program manager Mark Erickson. It will also give the port the ability to handle unit trains of 10,000 feet in length, which lowers cost for rail lines and shippers.
This project serves an important long-term goal: Long Beach would like to see half its cargo handled by rail, since intermodal transport has such a strong competitive advantage for long distance shipments into the American heartland - Chicago, St. Louis, even points east of the Mississippi River. Some of the San Pedro Bay ports' competitors have made inroads in this market using fast rail connections, and improving the velocity and cost of service will help Long Beach retain its edge.
On-dock rail also lowers congestion at the gate, reduces traffic on local roads and takes hundreds of diesel-powered trucks out of operation, cutting down emissions. And since about 10 percent of the port's TEU volume is currently trucked to off-site rail yards for loading, the Pier B terminal will also reduce the environmental impact of current rail operations.
As ships get bigger and economies of scale become more important, ports everywhere are feeling the pressure to invest in taller cranes and deeper harbors. Long Beach routinely handles 13,000-14,000 TEU container ships - about the same size as the biggest boxships that can fit though the New Panama Canal. It has already hosted one ship of the next-largest size category, the 18,000 TEU ULCV CMA CGM Benjamin Franklin, and the demand for handling these ultra-large ships will certainly come in future years.
To prepare for that eventuality and to increase the efficiency of its operations, Long Beach is redeveloping Piers D, E and F to make one giant three-million-TEU terminal. The $1.5 billion project will feature green innovations like electric rail-mounted gantry cranes in its stacking yard, shore power connections, LEED environmental standards for buildings, solar panels and storm water pollution prevention infrastructure.
The port's growth has had a significant positive impact on the local community's economy. According to its latest economic impact study, the port is directly or indirectly responsible for about 50,000 jobs, $9 billion in economic output and $3 billion in income in the City of Long Beach. In the five counties of Southern California, it has an impact of 576,000 jobs and $89 billion in economic activity.
The port is also sensitive to the impact of its operations on the local community, and the need to balance growth with environmental responsibility. The LA-Long Beach area has the highest ozone pollution levels in the country and the fourth-highest particulate matter counts; about 14 percent of Long Beach residents have asthma, compared with about 8 percent nationwide.
Historically, port and ship emissions in San Pedro Bay played a significant role in this environmental challenge, and Long Beach has moved to address the problem. In 2006, the port adopted a clean air plan in cooperation with the Port of Los Angeles. By incentivizing ship slowdowns, investing in shore power, and banning older diesel trucks from its gates, Long Beach has achieved significant improvements: by 2017, diesel particulates were down by 88 percent, SOx was down by 97 percent and NOx was down by 56 percent relative to 2005 levels - even as traffic has grown.
According to port executive director Mario Cordero, a former port commissioner and former chairman of the Federal Maritime Commission, these long-term achievements can be credited to the Port of Long Beach's decision to change the way it works with (and for) the community.
"When I was a commissioner here, back in 2003, I often said that the port's economic engine should not be only for the benefit of the few, but for the benefit of the many," says Cordero. "During those early years, many people in the community argued that there was no advantage to this port, because all that we brought to the table was pollution and traffic congestion. We rolled up our sleeves and said, we need to prove to the community that we have a serious interest in reducing harmful emissions - and we did that. Being from Long Beach and having ties here, for me it was a no-brainer."
Eventually, Long Beach wants to achieve zero emissions by switching to electric vehicles and equipment. It's already working on a trial at Pier T, where the California Energy Commission is helping to fund the installation of fast-charging infrastructure and the purchase of four battery-powered yard tractors. It will be the world's first heavy-duty, DC fast-charging system for off-road vehicles at a seaport - and it's one more step towards sustainable growth at America's "Green Port."
The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.