The
Future Of Port Policy & Finance

In this episode of The Future Of, Cary Davis, President and CEO of the American Association of Port Authorities (AAPA), joins host Jeff Dance to discuss the future of port infrastructure, policy, and finance. They discuss the challenges of investing in future-proof infrastructure, the importance of decarbonizing port operations, and the role of technology in shaping the future of ports.

AAPA’s Key Role in U.S. Port Policy and Sustainability Initiatives

The American Association of Port Authorities (AAPA) represents over 120 ports in the Western Hemisphere, focusing on securing critical funding and addressing modern challenges. Some of the organization’s recent legislative successes include the bipartisan Infrastructure Law and the Inflation Reduction Act, which have brought unparalleled investment in port infrastructure. The POWERS Program aims to increase the adoption of renewable energy sources such as offshore wind and solar in ports.

Modernizing the U.S. Ports

The U.S. port infrastructure requires extensive maintenance and modernization. This transformation is driven by funding from initiatives like the Bipartisan Infrastructure Law and the Inflation Reduction Act, focusing initially on rehabilitating aging traditional infrastructure, considering some ports are over a century old, like the 115-year-old pier in Port Angeles.

Cary also shares the importance of adapting ports to accommodate larger, modern vessels, both for cargo and tourism. Cary also reveals a rise in green energy projects at the post, with an impressive $50 billion dedicated to various initiatives, including hydrogen, nuclear, and offshore wind energy. Additionally, in early 2024, a $3 billion grant program from the EPA for cleaner infrastructure and operations is set to roll out.

Enhancing Port Security

Regarding port security, the Customs and Border Protection (CBP) Space Act aims to secure ports at customs expense and seek to reallocate merchandise fees, ensuring that CBP has enough resources for infrastructure and advanced IT systems, including AI, to identify high-risk cargoes. Additionally, due to increased cyber risks, ports undergo significant digital upgrades and IoT integration for security.

Shaping the Future of Ports

The future of ports goes down to reaching a balance between embracing innovation and ensuring security. There are complex decisions facing port authorities as they struggle with leveraging federal and state investments to future-proof their infrastructure. This includes choosing sustainable fuel options for ships, like methanol, ammonia, or hydrogen, and adopting new IT architectures and electrification to reduce carbon footprints. Also, cobots or collaborative robots will play a key role in enhancing safety and efficiency in ports, highlighting a leap from the past when manual labor poses greater risks.

The Dawn of Digital Platforms in the Supply Chain

Digital platforms play a critical role in revolutionizing the logistics and supply chain industry. Ports should adopt interoperable systems that allow seamless sharing of cargo data across various players in the supply chain, similar to Uber Freight. Besides, as the current system lacks a unified standard and communication among ports, the ultimate goal is to establish a trustworthy and interconnected digital infrastructure, potentially on a global scale, within the next two decades.