“Last Mile Delivery is undergoing a major change”

In daily traffic parcel delivery vehicles have become indispensable. More and more people shop online and this has consequences for both traffic and the environment. Prof. Dr. Asvin Goel from KLU talks about his research on route optimization, emission-free delivery and his ideas on how to revolutionize parcel delivery.

Professor Goel, the inner-city streets are busy and getting busier. What is happening on the "last mile"?

The delivery on the last mile is undergoing a major change – the rapid increase in e-commerce creates more and more deliveries. Often, several delivery vehicles operate in the same streets, causing traffic problems due to double parking. Furthermore, same-day or next-day deliveries are on the increase, re-sulting in lower consolidation possibilities and an increase in traffic and emissions.

It is evident that traffic emissions must be reduced, particularly in urban areas. The recent driving bans in major German cities show how urgently solutions have to be found. How can urban emissions be re-duced and which approaches are suitable for last mile deliveries?

By replacing conventional diesel powered vehicles with electric vehicles, we can completely avoid emis-sions in the city centres. However, the energy to power electric vehicles still needs to be generated. Un-less energy production is simultaneously switched towards renewable sources, emissions would simply be moved from the city centres to those areas where the energy is produced.

In our research, we focus on developing algorithmic approaches for optimizing routes for electric vehicles. With these approaches, we make sure that electric delivery vehicles can be used efficiently. At the same time, we also reduce the distance the vehicles need to travel, thus less energy is required and needs to be generated. Therefore, our research contributes both to reducing urban emissions and providing a pos-itive contribution to the climate.

Your research is part of Zukunft.de, a project funded by the German Ministry of Transport.  Vehicle manufacturers, parcel service providers and research institutes are working together to create greener and more efficient last mile deliveries in city centers with the help of electric vehicles. What has to be considered when switching to electric vehicles?

The goal of the large-scale collaboration project is to bring 500 electric transporters on the road in the in-ner cities of major German cities until 2020. Within the project, we work on optimizing the last mile with regard to the special requirements of electric vehicles. Due to the batteries required, electric delivery vehicles have less space and payload compared to conventional vehicles. Also, there are tight limitations on the range of vehicles. One of the challenges in the project is to determine how to optimize routes in such a way, that we ensure that vehicles do not run out of energy and can be recharged at suitable charg-ing stations when necessary.

How do you calculate the optimal routes?

Vehicle routes are usually calculated by solving a Vehicle Routing Problem (VRP). The VRP is a mathemati-cal problem in which we have different customer locations and different vehicles that deliver the packag-es. The question is to determine which vehicles should serve which customers and in which order the customers will be served. The goal is to find vehicle routes that can satisfy all operational constraints and minimize the total distance driven. In our research, we particularly focus on the operational constraints related to electric vehicles

What are the challenges within this concept for companies?

For the companies, the work processes are particularly difficult: Subcontractors are often used to deliver parcels on behalf of the company. These subcontractors often park the vehicles at their homes in the evening. Where and when can the electric vehicles be charged? How can I make sure that the charging station is available when I need it? Which infrastructure do we need? How does the range of the electric battery change depending on outside temperatures, e.g. if drivers turn on the heating? We must there-fore take these questions and more into account when developing the algorithms. This is not an easy task.

Through our research, we want to show companies that there are algorithmic ways to offset the extra cost of switching to e-mobility.

Let's take a look at the future - how can we make parcel delivery even more sustainable?

E-commerce will continue to grow, so we need innovative ideas to make last mile deliveries more sus-tainable. One idea is to learn from public transport in Germany, where we usually have integrated sys-tems in which customers can travel with a single ticket whatever transport mode and service provider they use. Each service provider receives a share of the ticket price according to some agreed mechanism.

Similarly, we could organize last mile deliveries such that the individual delivery companies would operate in an integrated framework. In such a system, we would no longer have delivery vehicles of competing companies operating in the same area. Instead, consolidation centers would be used to group deliveries with similar destination and optimized routes would be calculated to minimize overall traffic. The chal-lenge in realizing such a revolutionary transport system would be the transition from a system of inde-pendent and competing companies to a system where companies collaboratively operate to the common good. The example of public transport shows that, with sufficient support by the authorities and the nec-essary political will, such a system can actually be realized.