Climate change and economic consequences for inland waterway transport in Europe

Abstract

Future climate conditions are likely to affect inland waterway transport in Europe. According to some climate scenarios, in summer, in the river Rhine, periods with low water levels are likely to occur more often and become more serious. Then inland waterway transport carriers will experience more severe restrictions on the load factor of their inland ships, which implies a stronger reduction in transport capacity in the market. Transport prices will rise under such conditions. Some studies reviewed in this paper find that at extremely low water levels, the price per tonne for inland waterway transport in the river Rhine area will almost double. These increased transport prices result in welfare losses. For the dry summer in 2003, the losses for North West Europe are estimated to sum up to around €480 million. Increased transport prices trigger adaptation. Inland waterway carriers may use smaller vessels, and shippers have the opportunity to shift from inland waterway transport to alternative transport modes in periods with low water levels. This effect is probably rather modest, however, with a modal shift to road and rail smaller than 10 %. Also, changes in transport costs may lead to relocation of certain economic activities in the long run.