Canada's transportation crystal ball is looking distinctly green.

Environmental and sustainability concerns, as well as fuel prices and investment in technology, will largely determine how road, marine, train and aviation infrastructure and modes are developed 20-50 years from now, transport company operators and analysts say.

As a result, some warn, the movement of goods may slow down rather than speed up, while the introduction of more stringent environmental regulations may mean companies might not be able to get the just-in-time delivery service they covet today.

"Right now, the relative cost of consumer goods that fly and whip around the world is pretty small," says Clarence Woudsma, a University of Waterloo professor of transportation planning.

Michael Nobrega

"But as fuel prices increase and those (freight costs) start to increase, the patterns of demand are going to change, and that's something the freight industry is going to have to grapple with."

Growing concern over the environment is proving to be a driving force in Canada's transportation development.

"The transportation sector is the backbone of the Canadian economy," federal Transportation Minister Lawrence Cannon said in a speech earlier this year.

"(But) while the sector provides countless opportunities and advantages for Canadians, all of this activity also produces a lot of results in greenhouse gas and air pollutants. In fact, about 25 per cent of Canada's greenhouse gas emissions come from the transportation sector."

David Fields, co-ordinator of the Vancouver-based Livable Region Coalition, which advocates the removal of vehicles from the roads, predicts rail is Canada's greenest transportation option in the future. Fields says if he had his way, trucks would only be used at the local level, planes would not be used to transport cargo at all, and ships would run on new energy sources - not fossil fuels.

"Companies (in all sectors) need to be looking at producing closer to home," says Fields. "We all need to be prepared for rising (freight) costs."

He adds firms should also be prepared for reduced profits, at least in the short term, until new technologies are developed, in return for a cleaner environment.

While going "green" is today's trend, market forces will ultimately determine the direction of Canada's transportation industry, which is focused on the four major sectors of rail, trucking and bus, marine and air.

According to Statistics Canada, transportation's economic importance to the country ranks fifth behind manufacturing, finance, insurance and real estate. A 2006 Statistics Canada study found that the for-hire transportation industry accounts for about 3.7 per cent of Canada's GDP, and the contribution rises to 6.3 per cent when companies in many other industries, such as wholesaling, which operate their own ships, trucks or fleets of vehicles, are considered.

The country's massive railway system, a conduit of passenger and freight movement for more than 120 years, is likely to continue playing a key role, observers say.

Michael Nobrega, president and CEO of the Ontario Municipal Employees Retirement System, which oversees a multibillion-dollar pension fund that invests in large infrastructure projects, predicts rail and port expansion will be tied together.

"I would see more rail, because climatic (environmental) issues will interfere," says Nobrega, adding high oil prices will make rail more affordable in the future. "Rail in the cities will move people around and rail in the outlying regions will move goods around."

Canada's transportation system requires $15-30 billion worth of infrastructure investment in the next 20 years, Nobrega says. He believes much of that money will likely be directed toward expanding major ports such as Montreal and Halifax, now that major upgrades at Vancouver and Prince Rupert, B.C., are underway.

The potential of rail has also captured the attention of Peter Wallis, president and CEO of the Calgary-based Van Horne Institute, which advises industry and governments on transportation matters.

Wallis predicts a high-speed transportation corridor between Calgary and Edmonton will be well established 50 years from now and serve as a model for others across the country. The Calgary-Edmonton corridor, he says, will include a high-speed rail system that serves both industries and tourists, links north to Fort McMurray and as far south as Lethbridge, and connect Calgary with Banff and Edmonton with Jasper.

Increasing demand and congestion will also likely force transportation companies to change the way they operate. Michael Kieran, past president of the Canadian Transportation Research Foundation, says some industries may outsource less services and bring manufacturing closer to consumers.

Kieran doesn't believe today's trend of consolidating large intermodal facilities - operations that tie together rail, ports and trucking - outside cities will reverse in favour of building more small inner-city terminals.

"But that's a big leap of faith," admits Kieran, a transportation principal with global consulting giant IBI Group in Montreal. "There's absolutely nothing in play right now that makes me think that's a smart idea and it will happen."

Container shipping and overland transport have been the "revolution" within the last 50 years, he adds. "And I think you'll probably see information (technology) taking us even further, so that things have to be handled a lot less along the journey."

Mayne Root, executive director of the Alberta Motor Transport Association, says most future freight shipments will be through such bulk containers.

He says the association's goal is to be as innovative as possible but adds industry is not prepared to fund the research and development of new technologies on its own.

"I don't think the big issues are going to go away," he says, adding it will take a societal shift to change the way roads are currently used, because people depend on getting goods when they want them.

Todd Connors, president of Toronto-area AmeriTruck, a hauling firm that operates across Ontario and along the U.S. Eastern Seaboard, says big-city infrastructure challenges will play a key role in future transportation challenges.

On some winter days, the 25-year industry veteran says, it can take several hours to make short trips across Toronto because of traffic congestion. Setting up warehouses within the city in a bid to make short trips may help improve productivity and curb emissions, he suggests.

"Obviously, blowing up Toronto is not going to happen," says Connors. "The road structure is not going to change anytime soon in the future."

But will it be industry or the taxpayer who foots the bill for improvements to Canada's transportation infrastructure over the next 50 years?

Lecia Stewart, owner of Vancouver-based transportation consulting company Stewart Gossage, a former Bombardier vice-president who specialized in high-speed rail, expects governments to play a leading role in the development of future train systems because, she says, a "political champion" is critical - along with private investment.

But she does not anticipate major changes in vehicle technologies.

"Fifty years is not a long time in the railway business when you consider the average life of a vehicle is 35 or 40 years," says Stewart. "Probably the biggest changes I would anticipate would be changes in fuel sources."

Jock Finlayson, vice-president of the Business Council of B.C., also expects governments to consider their historic role of investing in transportation infrastructure. "It's going to take a lot of marrying up of private-sector capital with public-sector capital ... That's certainly the direction we're going in British Columbia - and (the BCBC) think it's the right direction."

Adds Wallis: "The ability of governments to fund unlimited infrastructure will not continue."

But Waterloo's Woudsma believes governments might be willing to invest heavily in rail in the future because it can help them win the "sustainability battle."

"We're not going to see, in our lifetime, I don't think, the massive infrastructure investment that some people have been calling for," says Woudsma.

(Monte Stewart can be reached at monte@businessedge.ca)