A quarter of the building materials needed for the 2012 London Olympics site will be transported by water after completion of a £20 million project to make disused waterways in East London navigable for the first time in decades.

The move is part of a nationwide resurgence in the use of waterways and canals for freight, as transport groups, manufacturers and retailers look for cheaper ways to move goods.

The new Prescott Lock will enable modern wide barges to carry aggregates from Charlton, South London, up the Thames to the Olympic Park, via the Bow Back Rivers. These tidal waterways are backwaters of the River Lea and have been largely derelict since the Second World War.

The first shipments of aggregates to the site are expected this autumn and will substantially reduce road traffic around the area.

Simon Salem, marketing director of British Waterways, which looks after many of the country's canals and rivers, said that it had received many more inquiries in recent months from companies interested in using inland waterways to move goods. “There's definitely capacity for freight alongside leisure activities on Britain's wider waterways and that will bring environmental benefits,” he said.

The greatest interest has come from building materials firms already using some of Britain's biggest waterways, including the Manchester Ship Canal and wide rivers such as the Severn, the Trent and the Weaver for shipping heavy and bulky loads. Last autumn, Tesco, the supermarket company, began using the Manchester Ship Canal to transport wine from the docks in Liverpool to its bottling plant at Irlam, Manchester. Sainsbury's uses the Thames to transport goods.

The Inland Waterways Association, which campaigns to promote use of Britain's canals and rivers, argues that the potential for water transport is substantial. It wants British Waterways, a government-funded agency, actively to promote freight.

Only 1 per cent of domestic freight is transported on canals and rivers, even though carbon dioxide emissions from coastal and inland shipping are 80 per cent lower than those from road haulage, according to a report by the Commons Environment, Food and Rural Affairs Select Committee. It noted that in 2000 British Waterways promised to double the amount carried by water by 2010, but by 2005 the amount had fallen, from 4.3 million tonnes to 3.4 million tonnes.

Stobart Group, the transport operator, which owns the Port of Weston in Runcorn, wants to develop an inshore sea freight service and proposes using the Manchester Ship Canal for freight. The company has been talking to the Department for Transport about ambitious plans that, it says, would lead to significantly fewer lorries on the roads.

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