CORDIS

Executive Summary:
Smartfusion, a public-private partnership (PPP), was launched in April 2012 under the 7th Framework Programme and as part of the European Green Car Initiative (GCI). The project rationalized urban goods distribution services, reducing pollution and traffic and developing and evidencing the role of electrical and hybrid vehicles for clean urban logistics.

Smartfusion built upon the existing urban freight development strategies of three demonstration city-regions: Newcastle, Berlin and the Lombardy region. In each demonstration site, Smartfusion developed technological solutions addressing specific problems:
• Intelligent, hybrid electric propulsion systems for different environments,
• Deployment of battery drive metering systems,
• Intelligent routing and planning systems for freight deliveries.

Smartfusion developed a monitoring methodology and set out the project objectives using the Design and Monitoring (DMF) approach.
The method consists of sequential steps, which describe and compare the current situation to the (future) desired situation. Based on that comparison, the method develops alternative options which, consequently, are used to define the DMF overview table, which is composed by the monitoring indicators and their short- and long-term targets, the necessary activities to achieve the targets, the available inputs as well as the risks and the assumptions. Following the DMF approach, this task was not only successfully completed but it additionally gave the opportunity to explore a different, results-oriented method for project monitoring and evaluation.

In this project we explored what is meant by business models and what is meant by business model frameworks. With these components we completed the CANVAS process, once for COMO and the Merci in Centro centre, once in Newcastle upon Tyne for the Coherent Campus Delivery and Servicing Plan, and for Berlin we took a different approach and looked at evaluating the business model for the Volvo technology to be trialled in that city.

To achieve it's objectives Smartfusion delivered a system architecture for clean urban logistics.

The project developed and deployed an electric van equipped with an on-board telematics unit enabling an eco-friendly tour management and improving the service reliability.
The SMARTFUSION Green Planning and Routing software solution was modelled, developed and implemented.

Three trials were performed within the SMARFUSION Project in Newcastle, Berlin and Como. In different combinations, the main elements tested across the different trial sites were low emission vehicles (hybrid, electric), ICT support for routing, zoning and electric vehicle management, logistics efficiency of solutions based on consolidation centres, and urban freight policy options.

All solutions, technologies and vehicles tested performed well and SMARTFUSION demonstrated the technical feasibility of the solutions presented in different combinations and variations.

The results of the assessment were extremely positive for carbon reduction, air quality improvements, public sector benefits and technological feasibility.

The project was successful, exceeded all it's targets and goals and was recognised by local and national awards.

Project Context and Objectives:
Smartfusion, a public-private partnership (PPP), was launched in April 2012 under the 7th Framework Programme and as part of the European Green Car Initiative (GCI). The project rationalized urban goods distribution services, reducing pollution and traffic and developing and evidencing the role of electrical and hybrid vehicles for clean urban logistics. The aim of the GCI was twofold: to kick start the electric vehicle industry and to support the automotive sector during the economic downturn. Smartfusion was a response to EU clean urban logistics transport policy and in this respect, the project introduced the concept of the GCI in the last mile operations, to boost the deployment and market uptake of electric vehicles.

Smartfusion was not purely a research project. It built upon the existing urban freight development strategies of three demonstration city-regions: Newcastle, Berlin and the Lombardy region. In each demonstration site, Smartfusion developed technological solutions addressing specific problems:
• Intelligent, hybrid electric propulsion systems for different environments,
• Deployment of battery drive metering systems,
• Intelligent routing and planning systems for freight deliveries.
Project Results:
Design and Monitoring Frameworks

At the early stages of the project, Smartfusion developed a monitoring methodology and set out the project objectives using the Design and Monitoring (DMF) approach. The DMF approach, originally developed from the Asian Development Bank and the World Bank for project monitoring and impact assessment, is the continuation of the Logical Framework (logframe) approach relying more on stakeholders for developing the project strategy.

The method consists of sequential steps (the first two: stakeholder analysis and the problem/ objectives tree development), which describe and compare the current situation to the (future) desired situation. Based on that comparison, the method develops alternative options which, consequently, are used to define the DMF overview table, which is composed by the monitoring indicators and their short- and long-term targets, the necessary activities to achieve the targets, the available inputs as well as the risks and the assumptions.

Following the DMF approach, this task was not only successfully completed but it additionally gave the opportunity to explore a different, results-oriented method for project monitoring and evaluation. The original aspect of this method is the engagement of the relevant stakeholders in the very beginning of the project in order to better the project planning, define realistic project objectives and create commitment amongst actors with different interests. Through the DMF process, the stakeholders have been informed about Smartfusion, they have provided their views and expectations (about the project and in general on the local urban freight policy) and have assisted in shaping the project objectives and fine-tuning its technical details. Stakeholders have benefited from the process by extending their network and contacts with relevant local urban freight actors.

Several stakeholder and partner meetings took place in the first year of the project, so as to go through the necessary steps of the DMF approach and design the monitoring framework for each one of the demonstration areas as well as define the plan for data collection. The approach itself was monitored in order to identify the deviations from the original methodology and provide recommendations for its transferability.

Each city applied the DMF steps in a way that would better fit the needs of the local workshops: Como and Newcastle used questionnaires in order to collect the views of stakeholders while Berlin presented the stakeholders’ mandates and roles using presentations; Newcastle defined the problem tree together with the stakeholders, while Como and Berlin assembled the results from the problem analysis and presented the results to the stakeholders. Despite their differences, all cities agreed on the benefits of involving stakeholders in the early stage of the project, and the efficient deployment of the methodology. In addition, following the DMF approach for Smartfusion provided in general harmonised outputs and several common indicators for the assessment of the Smartfusion outcomes and impacts for all three cities were provided. More importantly though, the methodology has demonstrated how different stakeholders together can discuss on the problems, define a common understanding and shape realistic and efficient decisions on urban freight solutions.

Business Models

In this project we explored what is meant by business models and what is meant by business model frameworks. We identified that “a business model describes the rationale of how an organisation creates, delivers, and captures value.” It can be said “that value proposition, value architecture, value finance, and value network articulate the primary constructs or dimensions of business models.” We know that many urban freight interventions in the past have failed to continue due to the absence of a business model ensuring commercial viability, one of the three Bruntland pillars of sustainability. We identify that there is a growing interest in research in the development and creation of business models, and that these creation processes can be defined as business model frameworks. These vary from quite complex system analysis methods to broad brush simple toolsets. We evaluated the suitability of various frameworks. Due to it’s versatility, subjective rather than objective nature, it’s widespread support and it’s use in EU research we adopted the CANVAS framework.

After we decided what a business model was and how they are created, we identified that in the Design and Monitoring Framework we had some of the components to design business models, but not all. To fully populate a CANVAS we need not just problems, causes and effects, but also distribution innovations to seed the creation of potential new businesses. To that end we identified through desktop research many of the recent best practices in distribution innovation to help seed the process.

With these components we completed the CANVAS process, once for COMO and the Merci in Centro centre, once in Newcastle upon Tyne for the Coherent Campus Delivery and Servicing Plan, and for Berlin we took a different approach and looked at evaluating the business model for the Volvo technology to be trialled in that city.

With these draft business models we developed hypotheses, the answers to which aided us in identifying if these business models were viable or not. To that end we asked key questions that can be answered by the pilots and a clearer view on the ongoing viability of the pilots can be made. These CANVAS hypothese were reported on as part of evaluation.

Technological Developments

To achieve it's objectives Smartfusion delivered a system architecture, and following this the Smartfusion prototype components were as follows:
• On-board navigation system with integrated GIS that is updated with the current emission policy and transmitted to the vehicle system when entering an area.
• On-demand switching hybrid mode system that:
• Informs the driver about the city or operator policy, e.g. low noise or zero emission zone;
• Informs the driver on the effects in relation to the planned route and remaining electric energy
• Switches to electrical mode, if the driver approves and goes back to normal driving once outside the zone.
• Consideration of adaptive vehicle parameter set configuration: Certain vehicle parameters, e.g. max acceleration and max speed, were optimised depending on the current tour so that even if conventional driving mode is retained, it will be optimised to the current policy.

The project developed and deployed an electric van equipped with an on-board telematics unit enabling an eco-friendly tour management and improving the service reliability. The prototype description of this is:
• An electric light commercial vehicle;
• An embedded system able to:
• Provide the driver with real-time feedbacks for eco-driving;
• Ensure eco-routing capabilities to save energy and extend the vehicle autonomy;
• Improve the vehicle efficiency through optimized maintenance and parameter monitoring;
• Interact with the back office systems for tour management.

The SMARTFUSION Green Planning and Routing software solution was modelled, developed and implemented as follows:
• Navigation application to enhance green routing and visualise electric vehicle (EV) information, delivered by a device linked to the energy metering and forecasting of the energy needed. Within the Lombardy demonstrator routing algorithms on electric vehicles were developed and tested. An integration of energy metering systems was made as a basis for forecasting energy consumption at consignment level;
• Tour App which integrates the green tour planning results into the navigation system;
• TourPlanning application to enhance planning for FEV fleet;
• GIS.Editor to parameterise the city policy into map attributes providing the planning and routing bases for urban delivery. The map attributes serve on the one hand as interface to the truck steering electronics providing the necessary data for steering hybrid propulsion engines. On the other hand it is the basis for enhanced optimisations on tour planning in terms of tour sequence and routing taking into account the local policy schemes. The results of the ‘GIS.Editor’ were integrated in a tactical application (tour planning component) and operational planning applications (navigation systems).

The maintenance of the tour planning component and the navigation system are managed by Smartfusion Backend Services. Algorithms and procedures adapted for an optimisation on low emission vehicles were developed.

Functionalities such as collaborative planning and optimisation procedures were elaborated and tested together with the demonstration partners. A planning environment, based on the ‘GIS.Editor’ was integrated. In it scenarios can be modelled in order to assess the impact of different settings (logistics, policy). This was then developed into the Smart Urban Freight Designer.

Demonstrations

Three trials were performed within the SMARFUSION Project in Newcastle, Berlin and Como. In different combinations, the main elements tested across the different trial sites were low emission vehicles (hybrid, electric), ICT support for routing, zoning and electric vehicle management, logistics efficiency of solutions based on consolidation centres, and urban freight policy options.

The development and results of the trials have been followed and monitored in order to guarantee a detailed set up of required actions and expected goals, the precise identification of resources, and timing for the implementation, and a consistent data gathering.

In particular, in Newcastle the goal was to develop an urban consolidation centre as a final result of a targeted mix of policies, and to integrate electric vehicles in urban logistics operations. Therefore, specific tests have been run in order to monitor the logistics activities along the timeframe of the project, identifying the potential for optimisation of operation and related impacts according to the project objectives. The Newcastle trial addressed this by focusing on the institutional purchasing power of the University and the definition of added value as non monetary.

The Berlin demonstration is based on the use of a hybrid vehicle equipped with the ICT systems in order to monitor performance parameters and to test the adaption to specific regulations such as green and noise zoning. The tests have been run along a specific urban route testing various combination of powertrain mode (hybrid/diesel), functionalities of the ICT support system (monitoring, routing, zoning), and the vehicle load (full/empty). The demonstration showed how dynamic ICT tools can accompany the implementation of complex regulation along specific routes, and highlighted the effectiveness of hybrid technologies in reducing emissions.

In the Como case, the objective was to test the possibility of using an electric vehicle for urban deliveries under special urban conditions (slopes, etc.), together with the potential of optimisation of ICT supporting tool both on the routing and on the vehicle performance monitoring. A second goal was to demonstrate the efficiency of city logistics operations based on a consolidation process. The trial demonstrated the potential of electric mobility for last mile deliveries under specific not necessarily ideal circumstances, and the role of support ICT in monitoring and optimising the driving and operations.

Evaluation

Three trials were assessed during the Smartfusion project, in Como, Berlin and Newcastle. Within the trials four elements were tested i.e. vehicles (electric or hybrid), ICT support for routing and electric freight management, logistics efficiency, and urban freight policy options.

All solutions, technologies and vehicles tested performed well and SMARTFUSION demonstrated the technical feasibility of the solutions presented in different combinations and variations. In Como it was a consolidation centre, access restrictions to city centre, a 3.5t full-electric van and ICT support for routing and electric battery management. In Berlin it was a 26t hybrid diesel-electric truck for bulk deliveries, “electric vehicle smart” satellite navigation routing, and battery charging linked to a zoning management system. In Newcastle it was a 7.5t fully electric truck, a Delivery and Servicing Plan for the University, sustainable procurement and Consolidation Centre management.

The assessment method consisted in the before-after data collection and calculation of impacts on distance, traffic, number of vehicles, costs, energy and emissions. The results of the assessment were extremely positive for carbon reduction, air quality improvements, public sector benefits and technological feasibility.

The costing elements were less strongly positive, but mostly beneficial for businesses, with the reduction in fuel costs being the main driver for cost reduction achievements.

In Como, the main pollutant reduction is for particulate matters, because the overall diesel vehicle distance is significantly reduced, and therefore the PM2.5 and PM10 value are both reduced by 69%. This is due to the fact that the distance driven by diesel vehicle per day is reduced from 32km to 10 km. Noise emissions are much reduced in the city centre and air pollutant emissions in city centre are reduced to zero with the use of electric vans. An overall distance reduction of 37 % generates huge benefits in terms of reduced externalities such as congestion and accident, because these two indicators are strongly correlated with the total distance driven. It is therefore assumed that a 37% congestion and accident reduction is taking place, when replacing the “before” business model with the “after” business model trialled in Como.

In Berlin, the major impact of the hybrid truck is not to reduce CO2, it is to switch off the diesel motor completely for a short distance in sensitive area, thus getting air pollutants emissions down to zero, and noise down to a level not higher than the noise of a conversation for a pedestrian that is on the pavement in front of the driving truck. The “geofencing” functionality tested together with the full electric mode of the hybrid truck was a full technological success in terms of feasibility and ease of application. Zero emission zones can be entered into the navigation so that a vehicle driving through the zone can switch to full electric mode with the diesel motor switched off. This impact, with a 100% air pollutant emission on street portions length between 400 m and 1.2 km can be considered a huge beneficial impact for residents and local area, and bringing also great advantages for the management of premises fulfilling a sensitive economic or social function such as school, hospitals, urban parks and playgrounds.

Newcastle University was both the lead researcher and also the lead institution that identified, analysed and trialled a receiver led, institutionally focused approach to smart urban freight using electric vehicles in Smartfusion. The Newcastle trial addressed this by focusing on the institutional purchasing power of the University and the definition of added value as non monetary. The trial was evaluated using both the core Smartfusion WP4 methodology and also with a local forecast prediction for the potential benefits of the proposed full operation, currently being considered by the University. Given a conservative estimate and with the scepticism that all forecasts should receive, it is likely that a fully operational service could save 396t of carbon annually, even using the UK’s energy generation mix. Using the standard and replicable methodology we see that the Newcastle pilot yielded a cost reduction of 7% cost reduction in parcel handling costs per parcel due to fuel savings from changing to electric operation. This and the robustness of the vehicle in trial shows the operational soundness of electric vehicles in city logistics.

Recognition

Smartfusion won the Best Environmental Initiative prize at Newcastle University's Annual Environment Awards 2015. Projects and initiatives that demonstrate commitment to reducing the University's environmental impact are recognised by the academic award, as well as those that work towards helping achieve the University's sustainability objectives. The logistics organisation was praised for its delivery consolidation scheme and electric vehicle use in particular.

The winner of the 2015 Times Higher Education Leadership and Management awards was Newcastle University for the SMARTFUSION initiative to reduce delivery vehicles on campus and cut its carbon footprint. The Smartfusion project sees deliveries redirected to an off-site consolidation centre and then distributed throughout the university using an all-electric vehicle. The judges were impressed with the collaborative work that involved many parties to stop direct delivery to the campus site. “The benefits include cost savings to the university along with improvements to health and safety around the campus while protecting the environment using electric vehicles,” they said.
http://www.thelmawards.co.uk/thelma2015/awardswinners/winners

Potential Impact:
Innovations

Innovations represented a fundamental aspect of SMARTFUSION. Among the objectives of the project, innovations within the fields of low emission technology, green planning and routing, urban interurban logistics and freight policies have been applied, demonstrated and evaluated by the SMARTFUSION demonstration sites. The project analysed the context in which SMARTFUSION innovations have been developed, looking at market and application aspects, trying to provide hints for the strategic positioning of the main project outcomes as well as suggestions for applications and further developments within the city logistics strategic framework.

Main green ICT innovations have been identified and analysed according to the policy and industry trends, as well as to market forecasts and trends. The role of SMARTFUSION innovations has been highlighted mainly in the fields of environmental protection and traffic management, with strong potential for integration within the automotive industry sector. SMARTFUSION innovation provide outstanding added value in the implementation and enforcement of green policies and regulations. The green vehicles sector has been analysed looking at the main innovation and trends with specific reference to propulsion systems, from traditional internal combustion engines to fuel cells vehicles, with a specific insight on the main strategic drivers.

SMARTFUSION innovations in this field, consisting in the customisation of an electric vehicle by CRF/Fiat and a hybrid truck by VTEC, aim at testing the potential of low emission vehicles in urban freight delivery operations. Not only did the propulsion systems have a crucial role, but the innovation stands in particular in the interactions between the vehicle and the ICT systems which enables driver and despatcher to monitor the performance of the vehicle, control range anxiety and optimise the use and energy consumption.

Business models and distribution innovation are among the main enablers of city logistics viable strategies. The SMARTFUSION approach relied on models which are compliant with the existing market structure of the test field regions, using tested technologies in order to enhance the performance of those models. However, the study highlighted relevant emerging trends which will have to be faced by the evolution of actual business models, identifying possible development paths through collaborative approaches, and participative strategies.

Last but not least, the role of policy innovations has been highlighted concerning market, regulation and incentives, partnerships, infrastructure development and engagement strategies: the main recommendation emerging for the policymakers are related to the identification and assumption of a new role of coordination in city logistics policies where stakeholders are ready to take active part not only in the operational aspects but also in the problem setting and planning of solutions, joining the common goal of a more sustainable urban freight mobility.

According to the analysis of market innovative trends, it emerged clearly that logistics strategies must be able to match both consolidated trends such as industrialisation, just-in-time demand and e-commerce, but also emerging trends such as collaborative consumption, greening and shortening of supply chains, customisation and participative productions.

A key issue for prioritisation and incentive strategies is represented by the capability of fostering spontaneous acceptance based on fair and affordable conditions, respecting competition rules, and last but not least the inclusion for all stakeholders of sustainability goals in the freight strategy objectives.

Another important task to be carried out by the policymakers is to foster the development of collaborative approaches both by suppliers and consumers, setting up the conditions to maximise the opportunities for partnership development and, when necessary, participating in public-private initiatives in order to reach sustainability goals.

Moreover, as the evidence has shown an outstanding will of taking part in the decision process, local authorities, planners and experts must be active coordinators in engaging stakeholders in the development of innovative solutions, through the establishing of new methods for collaboration as laboratories, interest groups and dedicated committees.

SMARTFUSION tested policy innovations are meant to pave the way to new approaches in managing city logistic strategic development activities, delivering an open vision on innovation and capitalising the outcomes of technological and business modelling innovations analysed, implemented and applied during the lifetime of the project.

In particular, ICT tested innovations have a very important role in the enforcement of environmental regulations, as well as in the optimisation of sustainable logistics operations, with specific potential benefits shown in the field of traffic management and environmental protection, together with the innovation which refer to green vehicles. In fact, the SMARTFUSION experience has shown that environmental benefits related to the implementation of restrictive measures can be better achieved when intelligent vehicles are able to identify the constraints and fulfill the requirements set (this is the case of green zones, low noise emission zones, etc.).

In presence of effective tools for the optimization and monitoring, low emission vehicles can more effectively perform a wide range of options (also in propulsion) can be offered to the customers according to special needs in particular in the urban environment.

Finally, talking about business models the SMARTFUSION experience is based on more or less ‘classic’ city logistics ones. While in Como the role of the Local Authority is central also as service provider, in Newcastle is the main local institution, namely the University, to play the main role as a customer. Concerning Berlin, this is the case in which the Authority is basically the regulator, while the operator offering logistics services although public is performing the activity on a commercial basis.

However, the findings of SMARTFUSION helped to identify the potential of collaborative approaches involving a plurality of stakeholders, especially with the objective of delivering sustainable distribution innovations. The analysis helped to identify suitable innovative trends according to the different tested models and the territorial characteristics. Further analyses beyond the SMARTFUSION scope should start from the awareness that innovation in supply chains, distribution and consumption models is already taking place and evolving dramatically, and institutional innovation as well as the identification of innovative business model supported by technological development must be investigated in order to keep the pace with the evolution of demand and sustainability goals.

The methodology developed for the impact assessment and the participation of stakeholders has been validated and can be replicated in further projects.

Smartfusion ensured that both the public and the private perspective were taken into account. A strength of the Smartfusion project was the early inclusion of stakeholders in the consultation and the distribution of surveys at workshops. The KPI framework developed was based on the different stakeholders and their criteria. Collecting sufficient input on the stakeholder’s opinion has been a challenge though. An improved framework for urban freight impact evaluation should include more guidance on this topic.

According with the public perspective, Smartfusion recognized the need to include social costs and benefits. The method to quantify and compare these costs and benefits to financial impacts was a challenge during the application of the DMF and the impact assessment.

The project developed the impact framework in parallel with live demonstrations that took place, so that the assessment framework could be tested and improved within the project life time.
A great difference between these trials and other projects is that within Smartfusion, all demonstrations relate to the use of electric freight vehicles, whereas in other project the solution directions are very diverse and include different modalities.

Nonetheless, this positive impact assessment results lead to the conclusion that the framework and design can be applied to a variety of initiatives and measures, with different circumstances in the future.

The number of initiatives that aim to improve urban freight transport is growing rapidly. To make sure that the results obtained are of quality as well, we should make sure that we do the right things and that we know how to. To avoid that we waste money, effort and time, knowledge transfer across cities is very important. That knowledge should be based on a transparent evaluation, identifying the relevant impacts and measurable indicators that represent the key objectives of all stakeholders.

As there is not one simple owner of urban freight transport issues, such a thorough evaluation is often lacking. During the last decade, research institutes and consultants have taken the role to support the different actors with the evaluation. In doing this, they work not only together with market actors and municipalities, but also with each other.

List of Websites:
http://www.smartfusion.eu