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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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Suggested Citation:"Chapter 4 - Conclusions." National Academies of Sciences, Engineering, and Medicine. 2012. Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments. Washington, DC: The National Academies Press. doi: 10.17226/22747.
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64 4.1 Road Map 4.1.1 What Needs to Be Accomplished to Realize a Standardized ESP System? 4.1.1.1 Stakeholder Buy-In Shippers. For an ESP system to work most effectively, the shipper needs to be the entity making initial electronic data entry. That entry would facilitate use of ESP by all per- sons downstream in the hazmat shipment supply chain, out to and including the consignee. The shipper would need to have a compelling reason to take the additional step, and the additional cost should be borne by the party getting the ben- efit. Gaining greater acceptance of ESP among shippers is a key hurdle to ESP implementation. Freight forwarders are mentioned in conjunction with this group because they are in most cases the next to handle ESP. Freight forwarders are generally a key interface with carriers. If they receive ESP from the shipper in electronic form, it is easy for them to maintain the integrity of the ESP in provid- ing the documentation packet to the carrier. Their buy- in should be attainable since dealing with electronic forms should require less labor. If they do not receive ESP in elec- tronic form, they currently have little incentive to themselves convert hard copy hazmat shipping papers to ESP. Carriers. When the ESP is handed over to the carrier in electronic format by the shipper or freight forwarder, it is the job of the carrier to transport the hazmat to the con- signee. Alternatively, the carrier may interline the shipment to another carrier, whether one of the same mode or a different mode. The carrier may have to break up the shipment, in which case ESP must have a process for digital signing and acceptance. After a hazmat shipment is split up, the ESP sys- tem needs a process to cancel out and destroy the original ESP documentation. This should not be more time-intensive than the current paper system. With greater in-vehicle com- munications, some motor carriers may want to involve the truck driver; thus, drivers may need to communicate with the dispatcher or perhaps the back office in supporting the electronic processing. Carriers will hopefully recognize the advantages of adopting ESP, although small motor carriers will have fewer margins in that regard than larger firms or Class 1 railroads. Regulatory organizations. An inspection organization may be a nation’s customs organization such as CBP, CBSA, or Aduanas. These organizations are interested in safety and secu- rity, and their primary concern is ensuring that they know what materials are crossing their respective borders. ESP will facili- tate filing of the ACE e-manifest and may allow even greater advance notification for bulk quantities of more dangerous hazmat cargo. An inspection organization may be a roadside inspection agency such as FMCSA, CVSA, or state public safe- ty department inspection agency. These roadside inspection organizations prefer to call up a vehicle’s ESP information on a screen rather than searching though what may be dozens of pages of hard copy shipping information. The greater speed of an ESP process allows the roadside inspection agency to inspect a greater number of vehicles, spend less time with each getting the sought information on cargo, and thus have more time and resources to detect and focus attention on problem shipments. Emergency responders. Emergency response personnel will welcome any initiative that improves their ability to get information about the contents of a hazmat shipment that is involved in an accident or incident more quickly and thus make a swifter, better-informed decision at the scene. With laptops, smartphones, and PDAs increasingly available to incident/emergency response personnel, the ability to con- nect to the Internet has become much greater in recent years. Assuming that the scene of an incident or accident is not in dark territory, where Internet and cell phone coverage is unavailable, this capability should allow them to have permis- sions to more quickly retrieve hazmat shipping papers when the paper copies are not safely accessible or are destroyed due C H A P T E R 4 Conclusions

65 to the circumstances of an incident. That assumes they can first positively identify the hazmat vehicle to get information on which to search. If the incident or accident is in dark territory, conventional emergency response will apply. 4.1.1.2 Data Entry Requirements A goal of a standardized ESP system is that shipment data be entered only once and shared among partners along the supply chain. Additionally, it is expected that these data be identified and populated in a consistent fashion throughout the lifespan of the data. Starting with the shipper, details of the shipment—particularly those with hazmat requirements— should be captured in electronic form and provided to other supply chain partners, such as the carrier, based on existing business relationships. In turn, each trading partner could use the provided electronic information, augmented to generate its own ESP and other related documents. As discussed in Section 3.8, multiple approaches exist to sup- port capture, transmission, and—as appropriate—persistence of this electronic information. Parties may generate messages directly from their own in-house system or use a VAN or even a portal to capture and disseminate information to other par- ties. Ideally, all of these partners would use the same standard- ized messages and delivery mechanisms, promoting greater interoperability. However, even in the absence of these stan- dards, many benefits could be realized from any exchange of data so long as the information itself is understandable to the involved parties. The CCL, as defined by UN/CEFACT, is one approach that could be used to ensure common definitions and use among parties. At a minimum, it provides for a fairly robust data dictionary that, even if it were the only standard used, would help ensure common understanding among partners when exchanging data electronically. Presently the CCL and the requirements for hazmat ESPs do not directly correlate. However, with effort and the support of the global shipping community, a common, harmonized data dictionary could be defined. 4.1.1.3 Information Flow Parameters and Limits Any solution to facilitate ESP must take into consideration not only the technical challenges associated with the exchange of the data but also the business sensitivity of the information being shared; it must adequately protect this information. Presently there are many existing B2B transactional formats and interfaces that serve the needs of the user community for which they are implemented and that could be considered for broader implementation. However, not all of them readily support integration with multiple platforms and partners, nor do they exhibit the necessary control or protection of data as warranted in this environment. An ideal solution would facili- tate both of these needs: multiple platform support and the ability to limit data shared to the appropriate need-to-know organizations. The development of interfaces that enable the integration of ESP with existing B2B applications and open standards (e.g., EDI, UBL, and XML) will enable exponentially greater participation in this ESP concept. 4.1.1.4 Ability to Support Multiple Transportation Modes The HMCRP Project 05 RFP stated that “The objective of this research is to develop a road map for the use of elec- tronic shipping papers . . . for and amongst all transport modes.” It is not sufficient to address the needs solely of the motor carrier industry, complex as they are. Trucking rep- resents the first and last mile of nearly all of the nation’s air and waterborne trade, and a significant portion of domestic rail traffic moves on business with trucking companies. The large number of motor carriers and their differences in size and technical capability set trucking apart from other carrier modes. However, providing a road map that only addresses moves that are entirely truck-borne will not help to solve the inefficiencies that affect the nation’s supply chains. Both the air and marine industries, through the IATA e-freight and IVODGA Removing Intermodal Impediments initiatives, have been moving in the direction of multimodal standards for dangerous goods declarations. The modes of rail, marine, and air already have addressed electronic equivalents of dangerous goods shipping declara- tions. The IMDG code and the ICAO Technical Instructions for the Safe Transport of Dangerous Goods by Air permit electronic transmission of dangerous goods declarations. The rail EDI 404 transaction set includes hazmat descriptive fields. IATA has established standards for the Declaration for Dangerous Goods data XML requirements for the SDDG and an IATA e-freight-compliant dangerous goods declaration. However, all of these initiatives and standards have fallen short of supporting true end-to-end compliance with dan- gerous goods documentation for carriage because they are unable to link all the other modes that are involved in the end-to-end movement of goods. Approaches or solutions that address multimodal ship- ments can only do so effectively if they address standards for format and data elements established for these other major modes. There is not a single global standard on which the motor carrier industry can simply base an adoption. There- fore, the industry must look to all of these industries through their predominant trade associations for collaboration. A sig- nificant hurdle that must be addressed for an ESP that covers marine and rail intermodal shipments is the rail industry’s use of the STCC. The STCC does not correlate in a one-to-

66 one relationship to UN numbers and is an impediment to end-to-end ESP for marine–rail movements. Ocean carriers are able to use electronic versions for their portions of moves, but the interchange with rail still relies on paper copies. While the ocean–rail interchange is showing signs of improvement, ocean carriers have frequent errors in data transmission due to the differences in UN numbers and STCC. Because trucking is a critical component of international end-to-end supply chains, an approach to ESP for hazmat by the industry must take into consideration and integrate with multimodal standards to close the compliance loop. 4.1.1.5 Degree of In-Transit Visibility The degree of in-transit visibility that may be available to adopters of ESP solutions is dependent on a number of fac- tors, including the willingness of partners to share informa- tion and the timeliness and availability of the data. Putting aside the institutional challenges and assuming that data are protected as necessary and appropriate, the opportunity for improved visibility increases substantially as more parties associated with a shipment support electronic information exchange. U.S. DOT’s EFM program is a case in point. Aside from the benefits resulting in the use of standards, the move away from batch data exchanges to a more real-time model greatly benefited the partners by making shipment informa- tion available on a timelier basis. This increased in-transit vis- ibility allowed for better planning on the part of warehouse staff as well as in supporting order fulfillments, among other areas. These same benefits could be realized with the increased adoption of more near–real-time models such as EFM. 4.1.1.6 Adequacy of Standards The adequacy of standards discussed in this report is a subjec- tive topic. In terms of the underlying Internet standards used to facilitate the secure transport of electronic information, based on the implementation of electronic data exchange capabilities in other market segments such as finance and law enforcement, those standards appear to be adequate to support the needs. However, there are some inadequacies. EDI was created on the premise that it would sufficiently meet users’ needs with- out modification. However, as witnessed in current imple- mentations of EDI, many users have extended or modified the standard documents to meet their specific business needs. Which of the changes were truly necessary versus which were simply preferred is unknown, but in either case the adequacy of these standards could be in question. Those developing UBL seemed to have taken this need to heart. While the basic data elements in UBL are consistent with the same underlying data elements as EDI, the crafters of UBL have implemented an ability to extend UBL documents without breaking their underlying compliance with the spe- cific XML schema. Since UBL and similar XML-based message formats are still in their infancy in terms of broad implemen- tation, it has yet to be seen whether the approach embodied within them is truly adequate. At a minimum, with the pres- ence of XML validation tools, there is much less likelihood that implementers will vary from the standard schema. 4.1.1.7 Degree of Interoperability with Other Electronic Commerce Systems Similar to the emphasis on the use of standards to achieve interoperability among partners needing to exchange hazmat ESP, interoperability with other electronic commerce systems is highly dependent on the adoption of and adherence to stan- dards. While use of EDI for electronic information exchange is reportedly still dominant, the use of XML is growing and has the potential to become the de facto standard. If so, it might be expected that interoperability will be dependent on the use of XML. Requiring that the implementation of the XML schema, such as that in UBL, be based on the UN’s CCL takes that interoperability a step further by introducing a common underlying metadata dictionary. Finally, the use of current data exchange practices such as web services further increases the opportunities for interoperability. 4.1.1.8 Data/Communications Security Security will always be a challenge in the ever-changing and expanding Internet and e-commerce communities. However, with the continued growth in online transactions come new approaches to satisfy the security needs of these user com- munities. While this report has not focused on the security needs of an ESP solution, the W3C, OASIS, and other entities have invested in the development of standards and processes to support implementation of security in other high-visibility industries such as banking and law enforcement. Additionally, there are numerous best practices that have been documented, ranging from the use of simple but encrypted secure-FTP capa- bilities to multistage biometric-based logons that are available for adoption in an ESP environment. Compared with the industry’s current commonplace approach to sending EDI documents over standard FTP or via e-mail, adoption of any of the more modern security mechanisms will result in an enhancement in security. 4.1.1.9 Safety and Operational Implications of Mixed Paper and Electronic Operations The use of ESP allows railroads to provide information to emergency responders in many ways. In a rail hazmat acci- dent or incident, shipping papers can be faxed or e-mailed to emergency responders if the papers are not available through the train crew. They can even be sent to PDAs. This has

67 improved the safety of dealing with hazmat incidents. It also allows railroads to check the accuracy of their train consists, when they are departing yards, as cars are scanned. ESP have permitted increased accuracy in the final product by enabling automated comparison of the ESP entries to a standardized shipping description database that AAR maintains and the railroads use in their billing/shipping paper process (48). 4.1.1.10 Regulatory Changes That Would Be Needed to Enable Use of ESP Records PHMSA, under its former name as the Research and Spe- cial Programs Administration, issued a special permit to allow railroads to use ESP over 30 years ago. PHMSA recently issued a notice of proposed rulemaking adopting that into the regulations. It is likely that a similar regulatory action as that taken for railroads would provide commensurate ben- efits to other hazmat transportation modes. 4.1.2 Stoplight Chart of ESP Readiness Table 15 illustrates the state of readiness for ESP implemen- tation in stoplight format. 4.1.3 The Path Forward for the Use of ESP for Hazmat Shipments Looking across the international and multimodal trans- portation community, much of what needs to be in place to realize a standards-based ESP solution already exists. Table 15 summarizes the state of readiness of eight key elements with only one component—interoperability with other electronic commerce systems—displayed as red, signifying a potential major hurdle. Efforts such as IVODGA’s Removing Intermodal Impedi- ments to Dangerous Goods & Hazmat Shipping and IATA’s e-freight should be referenced for valuable lessons. Both efforts took a multimodal approach and gleaned useful infor- mation regarding the use of data elements in place across multiple modes. IVODGA prepared a detailed multimodal mapping of these elements in its 3.12 Shipping Paper Work- sheet for All Modes (49). Both efforts have faced challenges in realizing broad acceptance and adoption, yet how and why these challenges arose and what these organizations have done to address them will also yield valuable lessons for hazmat ESP. Among these lessons is that developing an approach and performance metrics that account for business processes and improve efficiency of participants along the transportation information chain are crucial. Also, stakeholder education leading to broad acceptance and adoption is critical to make the transition from research to practical application. The path forward will entail a multiphase, multiyear effort requiring sponsors and champions from the public sector and associations representing key modes. The key elements of this effort involve: 1. Development of standards for e-commerce and data elements; 2. Proof-of-concept tests, field tests, and pilots; and 3. Cost–benefit analysis. *R/Y/GssenidaeRtnemelEssenidaeR Stakeholder buy-in Shippers and carriers must see a positive net cost– benefit ratio before adoption is likely. Challenges to data privacy and sensitivity must be overcome before regulatory and emergency responder stakeholders can expect to benefit. Y Data entry requirements A data dictionary must be selected and subsequently extended to handle hazmat information. Y Information flow parameters/limits Interfaces that enable the integration of ESP with existing B2B applications and open standards must be developed/adopted. Y Support of multimodal shipments Marine and air have begun moving down the path of multimodal standards. Rail’s use of STCC is a critical barrier. Y Degree of in-transit visibility This visibility is dependent on willingness of partners to share information and the timeliness and availability of the data. Y Adequacy of standards Standards exist to support nearly all aspects of an ESP solution, and it is simply a matter of choosing which best serves the user needs. G Interoperability with other electronic commerce systems A multitude of current, disparate systems and no specific mandate to change preclude this from being readily implementable. R Data/communications security Current security standards and best practices implemented in other industries are adequate to support e-commerce and ESP needs. G *G = Green, Y = Yellow, R = Red Table 15. ESP implementation state of readiness.

68 Approaches for ESP compliance may be developed that offer alternatives to electronic data exchange. It would be prema- ture to rule out these alternatives at this time. However, broad adoption that meshes with business processes and improves efficiency will need to incorporate electronic data exchange. Therefore, standards for e-commerce, including data elements, must be established in the path forward. While the standards needed to support ESP solutions have already been covered by IVODGA and IATA, interoperability with other e-commerce systems remains a key hurdle, as shown in Table 15. A series of proof-of-concept exercises, field tests, and oper- ational pilots should be conducted to assess the feasibility and functionality of alternative approaches. Section 4.2 provides a detailed methodology for the proof-of-concept exercises designed to test implementation strategies and functionality. The proof-of-concept exercises will be the first phase, and subsequent tests will narrow feasible options to those most likely to meet the goals and performance objectives of ESP. Cost–benefit analyses should be a part of each test phase to ensure that practical and implementable solutions that meet business-level ROIs are being sought. Industry will not accept unfunded mandates or approaches that provide benefits to one participant segment while driving up the cost of another segment. 4.1.4 Timeline (Outline for a Path Forward) Table 16 shows key milestones that need to be achieved for implementation of ESP. These are essentially sequential, although some overlap should be possible. With an aggres- sive approach, it may be possible for pilot ESP implementa- tions to be under way within a decade. 4.1.5 Steps to Educate and Prepare Stakeholders for Technology Adoption and Implementation One noteworthy example of an effort to promote paperless transactions is the path taken by IATA on its e-freight initiative. IATA’s efforts toward the goal of paperless transactions have been in progress for years. The IATA e-freight initiative does not provide an e-commerce system but rather a standardized messaging process to support e-commerce. IATA clearly identified the problem, the vision for its solution, and the justification for doing it. They published a vision and mandate for the initiative, along with a brochure and fact sheet. IATA defined terms, derived the business case with assumptions, and supplied a cost–benefit calcula- tor. For the product, there were a handbook, self-assessment questionnaire, business process and standards information, message improvement program (MIP) strategy, and link to international conventions and standards. IATA recognized the need for collaboration (i.e., get- ting an entire supply chain to work together to change the way it operates). They recognized that there was a lack of agreed upon electronic standards for all documents and that where electronic standards existed, they were not used consistently or with the level of quality required. IATA realized that there were legal aspects, particularly with how electronic data could replace paper and still meet legal/ Timeframe: Near mreT-gnoLmreT-diMmreT- Action/ milestone Identify champion for ESP effort Review and consolidate products of prior related efforts (e.g., IATA e-freight, IVODGA’s Removing Intermodal Impediments to Dangerous Goods & Hazmat Shipping, HM- ACCESS) Facilitate meetings of ESP stakeholder organizations Discuss e-commerce standard(s) and data elements applicable to ESP Conduct initial cost–benefit analyses on elements of ESP implementation Conduct sponsored proof- of-concept test(s) Identify conceptual ESP system Conduct cost– benefit analyses on conceptual ESP system Reach agreement on required ESP data elements Define e-commerce standard(s) applicable to ESP Accept e-commerce standard applicable to ESP Conduct field tests of prototype ESP system Conduct limited and wider field tests of ESP standard and system Enact guidance Conduct pilot implementations involving all transportation modes (i.e., highway, rail, marine, and air) Table 16. Milestones on ESP path forward.

69 regulatory requirements. They recognized the importance of the business process with respect to how they would be able to operate without paper and still deliver to the end customer. IATA gathered a strong coalition of leading stakeholders who were committed to their vision and to attaining it. They implemented pilot projects to establish the basic principles of their IATA e-freight business process and demonstrate that it could work. They built up their industry data readiness via the IATA MIP. They helped educate and assist their members in implementing the e-freight system, and they used a dashboard to illustrate how implementation of the system was progress- ing (50). The IATA e-freight approach is well thought out and comprehensive. There is much from the process that can be applied to the ESP initiative. The objective of IVODGA’s Removing Intermodal Impedi- ments to Dangerous Goods & Hazmat Shipping program is to “work with government and industry partners to develop and implement a program to remove impediments to intermodal/ international transportation and facilitate e-commerce” (51). This initiative has seen a great deal of improvement, especially with the HM-206F rulemaking on emergency response infor- mation in 2009. Improvements have resulted in a marked decrease in FRA citations and rework for ocean carriers. Most of the partnership lines communicate almost exclusively electronically. For implementation of a multimodal ESP system to be suc- cessful, there must be an industry-wide approach that takes into consideration the perspectives of all stakeholders. There must be adequate funding to support the necessary activities. There must be commitment, cooperation, and collaboration. Perhaps most importantly, there must be a muscular cham- pion who provides strong leadership, focus, and the deter- mination to see the process to its conclusion. This champion could be from within industry or government, but without such a role success will be elusive. 4.1.6 What Industry Can Do to Overcome Impediments and Facilitate Movement Toward the Desired State When industry decides to act voluntarily, it is important to have—or develop—a users’ association to build consen- sus. Having a critical mass of organizations with different people, areas, backgrounds, needs, and agendas provides the rigor needed to get to a well-balanced plan that can solve the challenge. It is important to get them to sign up to a set of rules and work with customers to develop the best-practices process. Organizations have to be prepared to make some concessions for an equitable solution. Collaboration and coordination are critical to success. 4.1.7 What Government Can Do to Overcome Impediments and Facilitate Movement Toward the Desired State Sometimes for a challenge of this nature it takes a govern- ment commitment to compel a solution. Governments have the greatest wherewithal to force change. Government has shown that it can help bring about new approaches to data transactions. With an eye to national security needs, CBP implemented the ACE program and instituted a requirement (with some exceptions) that an e-manifest for a commercial vehicle intending to cross into the United States be submit- ted prior to vehicle’s arrival at the CBP port of entry primary inspection facility. CBP has limited the impact of implement- ing the ACE program. ACE meets CBP’s needs and does not appear to have added significant cost to industry. Similarly, if customs agencies across the world agreed to start requir- ing paperless transactions, the stage would be set for a wide- spread ESP solution. 4.2 Methodology for Proof-of- Concept Exercises Designed to Test Implementation Strategies and Functionality To recapitulate, for HMCRP Project 05, this activity was to compile “a methodology for proof-of-concept exercises designed to test the implementation strategies and func- tionality of [the] electronic hazmat documentation and data transfer system identified. . . . The deliverable is not expected to detail specific scenarios, but is intended to pro- vide a framework, a guideline, and/or a series of questions through which future researchers may propose validation exercises.” 4.2.1 Proof-of-Concept Exercises Process The following provides the methodology by which the proof- of-concept exercises can be measured and evaluated: I. Performance measures a. Exchange of hazmat ESP and manifest informa- tion between parties involved in transportation, including shippers, carriers, and consignees b. Report of transfer of the shipment between parties as well as its final delivery c. Frequent (i.e., near–real-time) exchange of information d. Compliance with international standards of data exchange, including the format and content of the message (e.g., UBL, UN-CEFACT) as well as the exchange mechanism (e.g., web services, FTP)

70 e. Compliance with international and/or indus- try standards for material identification and classification f. Compliance with regulatory requirements g. Data accessibility to authorized users/data and access protection from unauthorized users h. Electronic (nonvisual) identification of land vehicles by emergency responders. i. Near–real-time remote identification of haz- mat quantity, hazard type, package description, emergency response measures, key contacts, and location j. Positive cost–benefit ROI II. Identify potential electronic data exchange systems for ESP; for example: a. EDI b. UBL c. XML III. Determine major characteristics and strengths and weaknesses of each system a. System used for transferring data (e.g., Internet, e-mail) b. Software requirements i. Licensing difficulties and cost ii. User-friendliness iii. Current applicability to e-commerce iv. Ability to be modified for e-commerce v. Suitability for system under discussion c. Technology (hardware) requirements i. Current availability to potential users ii. Hardware and operations and maintenance costs d. Potential stakeholder acceptance and resistance i. System oversight requirements ii. Voluntary or mandatory program iii. Cost to users for equipment and operation (future system) e. Training required to operate by shippers and carriers f. Applicability to each of the major modes g. Applicability to regulatory oversight and com- pliance functions h. Functionality between modes i Roles of responsible parties (e.g., shippers, carriers) IV. Identify system for testing the following: a. Assessment of the system’s applicability to hazmat shipments in the United States i. System’s achievement of performance measures ii. Extent to which system strengths outweigh weaknesses iii. Commitment of stakeholders to participate and support test 1. Clearly identified benefits of system (e.g., more effective information transfer) 2. Ability to overcome institutional barriers (e.g., resistance to potential imposition of a uniform system) 3. Reasonable cost of future system iv. System that will be easily tested between at least two modes V. Select scenario for test that meets the following criteria: a. Scenario takes place in a geographically limited area (e.g., not to exceed 150 miles in diameter) b. Two sub-scenarios included i. Normal shipment ii. Shipment with a major incident c. At least two modes included i. Truck-to-rail ii. Rail-to-truck iii. Test truck-shipper/rail-shipper combinations d. Hazmat selected for test is representative of a large portion of total shipments. e. Includes involvement of selected major stake- holders from government and private sectors. Note that state agencies could be substituted for federal entities. i. For rail and truck interface consider the involvement of: 1. CVSA 2. ATA 3. AAR 4. FMCSA 5. PHMSA 6. FRA 7. National Emergency Management Associa- tion (NEMA) 8. International Association of Fire Chiefs (IAFC) ii. Include shipper, carrier, consignee, emer- gency responder, and enforcement rep- resentatives that each have the following characteristics: 1. Current user of electronic data exchange 2. Technologically sophisticated 3. Shipping large quantities of hazmat or trained to respond to hazmat incidents 4. Has positive attitude about the future use of ESP to supplement hazmat ship- ping papers and to provide electronically transmitted manifest information

71 VI. Develop a table-top exercise in a workshop prior to field exercise a. Develop concept for table-top exercise b. Use computer simulation and models to repre- sent real-life situations c. Select workshop facilitators d. Develop workshop materials for participants e. Select and invite participants who are representa- tive of major stakeholders f. Use evaluators representing key stakeholders (including carriers, shippers, consignees, and emergency responders) to determine readiness for field test g. Select evaluation form to be used by table-top evaluators h. Conduct evaluation i. On the basis of evaluation, use selected system j. Make recommendation for conduct of limited field test k. Develop plan for limited field test VII. Conduct limited field test of selected system follow- ing selected scenario a. Acquire software and hardware for test b. Identify a shipper, carrier, and consignee for the test c. Obtain commitment for use of vehicles d. Install hardware and software e. Develop training materials for participants f. Develop evaluation form to be used by evaluators g. Identify test evaluators (evaluators will include test participants and selected stakeholder representatives) h. Conduct normal and incident field tests VIII. Evaluate field test and make recommendations for next step a. Combine evaluations from all evaluators b. Make recommendation to expand field testing of the ESP system c. Identify strengths and weaknesses of the ESP system identified in the test d. Develop specific recommendations to correct these weaknesses e. Develop recommendation for widespread adop- tion of system f. Obtain support of key stakeholders g. Identify funding sources and obtain funding IX. Conduct wider field test of the selected system a. Develop plan for wider test of the system b. Include at least three modes in wider test c. Develop training materials for participants d. Implement wider test 4.3 Use of This Report Any investment in technologies for business efficiencies can be quite large, and the ROI may be difficult to determine. With the information from this project, HMCRP and its stakeholders will have greater knowledge of ESP systems that are already bringing benefits to their users; the attributes that can result in greater interoperability of existing ESP systems; and the road map that describes the benefits of, and the path toward, creating a unified ESP system that supports inter- operability and exchange of standardized electronic commerce for hazmat transportation. One of the best ways to determine the success of this project is to measure the number of government transportation offi- cials, shippers and carriers, emergency responders, and other stakeholders seeking the results of this study. A secondary means is to gauge the number of organizations that access and subsequently use the project’s findings to inform their plans to incorporate ESP. Whether these data are captured through uploaded success stories or some other means is beyond the scope of this project. A number of respondents on this project noted that it is very important to have good cost–benefit data. These data have been difficult to find. Therefore, going forward, it is rec- ommended that cost–benefit analyses be undertaken to assist those organizations that wish to implement ESP. 4.4 Summary/Conclusions 4.4.1 Relevance of Larger e-Commerce The key to implementing hazmat ESP for the benefit of all of its major stakeholder groups and for multimodal shipments is solving the larger challenges of e-commerce. E-commerce is currently being used quite successfully in some areas by groups using electronic document submission. However, these successful examples have developed largely in isolation from other modes and other stakeholders, and there is no common standard with adequate guidance to allow them to have that compatibility across multimodal domains. 4.4.2 Data Entry Origination For ESP to be successful, data need to be entered once and reused to the greatest extent. To achieve that, entry of elec- tronic data into ESP needs to start with the shipper. Only in this manner is it feasible for the electronic chain to be initi- ated and have the continuity throughout the shipment’s life cycle required to meet ESP’s potential. Origination with the shipper is not currently being done to a significant extent, which is a large obstacle. To resolve it, an alignment is needed so that the parties that reap the advantages of ESP will bear

72 their share of the responsibility for its expense (i.e., the ben- eficiary pays). Until that is achieved, there will continue to be little incentive for implementing ESP on a large scale despite the desires and best intentions of many proponents. 4.4.3 Data Accuracy Accuracy of shipping paper information can be improved by incorporating techniques that provide greater quality control to shipping information. For example, if a receiving facility that is coded to receive a certain hazmat is not safe for offload of that hazmat, the mismatch can be automatically caught through an electronic system, which enhances safety. Misspellings or other mistakes can be caught through spell- ing checks or other associations that an electronic system can be configured to look for. 4.4.4 Business Information Visibility and Security Security-sensitive and business-sensitive information will be protected through advanced processing techniques and commercial encryption practices. Safety and security will be enhanced by having information about en route shipments accessible, in emergency situations and with permissions, in ways that are not possible with paper copies. Information about bulk hazmat shipment progress and expected arrival can be known ahead of time, much as CBP’s ACE program is notified of shipment arrival at the border ahead of time. The greater visibility is important for business efficiencies as well as safety and security purposes. 4.4.5 Standards and Guidance The best features of current and future commercial solu- tions can be captured and used through effective standards and guidance. When total costs are properly aligned in a beneficiary pays model, savings should be achievable. For example, paper copies can be printed from highly accurate ESP as opposed to ESP resulting from laborious electronic keying of information from the paper copies by a stakeholder that does not realize a benefit. When ESP are in more widespread use, they will become more familiar and accepted, as electronic transactions were in the banking and financial industries, to name but two. The guidance process can be used to promulgate news of regu- latory actions and provide useful information. 4.4.6 Emergency Responder Awareness Safety will be improved by enabling access to ESP infor- mation in circumstances where securing access to hard copy hazmat shipping papers may not be possible. A costly delay could occur when shipping papers are destroyed or inacces- sible due to the aftermath of a serious hazmat spill such as might result from a tank truck crash or rail tank car derail- ment. Depending on circumstances, delay in accessing paper copies may be considerable and occur at the moment of greatest need. Emergency responders and roadside inspec- tion personnel will be able to have access to ESP through pre-arranged permissions appropriate to their need. This will allow quicker access to the information on the shipping paper, including emergency response-related information, in a manner that can supplement services already available to help emergency responders. 4.4.7 Intermodal Transfer Hazmat shipping information will be more easily transferred to other modes, facilitating interlining. When shipments are split up en route, electronic signatures and approvals can help reduce confusion and provide greater visibility into what is to be delivered to the consignee, and when. 4.4.8 Cooperation and Achievability Transmission of completely electronic ESP information cannot be attained overnight. Companies that exist to trans- late and reformat shipping data to facilitate e-commerce will continue to provide their services (perhaps focused more on shippers than freight forwarders), retain their market, and serve as catalysts to greater acceptance of ESP. Realizing these benefits can best be achieved through voluntary action. It will require cooperation and commitment among the stakeholder associations and groups that represent shippers, freight for- warders, carriers, and consignees of hazmat shipments, in consultation with regulatory compliance, enforcement, and emergency responder stakeholder associations and groups. The private sector is most concerned with business efficiency and cost savings. Industry knows the most appropriate tech- nology solutions and standards that should be applied to the challenge and can implement them with great efficiency once accepted. It must be recognized that the level of coop- eration envisioned is considerable. It requires achieving a critical mass of decision makers, screening and adopting best practices, and providing assistance and perhaps incentives in order to get voluntarily agreement. 4.4.9 Regulatory Considerations If voluntary efforts fail to achieve desired results, govern- ment could intervene. That should be an encouragement for voluntary action, to ensure that the most appropriate technology and process solutions can be applied to the need. Government is primarily concerned with safety and security

73 and seeks to avoid regulatory actions that impede commerce. Stakeholders have mentioned that if regulation involving ESP is enacted, it should be used to level the playing field between adopters and non-adopters so that ESP adopters are not penalized in the process and that regulation does not impose an unfunded mandate. 4.4.10 Promotion and Collaboration Trade associations and other stakeholder organizations can help define ESP implementation goals that benefit the larger hazmat transportation community as they advance the inter- ests of their members. Key stakeholder groups could be allowed to sponsor and conduct the proof-of-concept exercises and follow-on tests, participate in collaboration to help promote achievable goals along the path to ESP implementation, and encourage participation in a global ESP implementation pro- cess. PHMSA, the other U.S. DOT safety organizations and modal organizations, regulatory compliance and enforce- ment, and emergency responder representatives would need to be part of the process even if industry takes the lead. 4.4.11 E-Commerce and ESP Adoption Normally, it would seem that the solution to greater use of hazmat ESP would follow improvements in standards and other aspects of electronic data transfer, not drive the improvements or happen independently of them. How- ever, the safety and security aspects of hazmat shipping have resulted in rules and regulations beyond the needs of com- merce alone. Thus, improvements brought about by a rea- sonable system of hazmat ESP could be an inducement or even a model for larger incorporation of e-commerce. It is feasible that within a decade, hazmat ESP could be imple- mented and substantially in use by stakeholders, with a great degree of in-transit visibility.

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TRB’s Hazardous Materials Cooperative Research Program (HMCRP) Report 8: Evaluation of the Use of Electronic Shipping Papers for Hazardous Materials Shipments examines the challenges of advancing the use of electronic shipping papers as an alternative to the current paper-based hazardous materials communication system.

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