CSX CEO says it will buy no more cars or locomotives for dying coal transport Locked

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CSX CEO says it will buy no more cars or locomotives for dying coal transport
Posted by schlimm on Friday, July 28, 2017 7:37 AM

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Posted by K. P. Harrier on Friday, July 28, 2017 8:11 AM

If the above link doesn't work, you might try this one.

https://thinkprogress.org/fossil-fuels-are-dead-says-rail-baron-b177af077344

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Posted by Euclid on Friday, July 28, 2017 8:56 AM

 

I am surprised that Mr. Harrison takes that position in this highly political debate.  If he knows coal will die, but he does not know when, why bail out right now while there is coal traffic to haul?  His announced position is just adding to the politics of killing off coal by regulations sooner rather than later.

 

 

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Posted by Buslist on Friday, July 28, 2017 9:20 AM

Euclid

 

I am surprised that Mr. Harrison takes that position in this highly political debate.  If he knows coal will die, but he does not know when, why bail out right now while there is coal traffic to haul?  His announced position is just adding to the politics of killing off coal by regulations sooner rather than later.

 

 

 

He's only not buying new equipment, NOT getting out of the business.

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Posted by tree68 on Friday, July 28, 2017 9:31 AM

Buslist
He's only not buying new equipment, NOT getting out of the business.

It may be his intention to "send a message."  Given his stating that he didn't figure to be around long, though, I'm not sure what purpose this serves, unless it is somehow intended to boost stock prices...

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Posted by VOLKER LANDWEHR on Friday, July 28, 2017 9:35 AM

I think Mr. Harrison has to take position. For CSX it is not a political but an economical decision. And he doesn't bail out he just doesn't invest in new equipment for coal transport anymore.

From my outside view not regulations kill coal but economics. With an abundance of cheap gas why burn coal for power?

And emission regulations are necessary . How far they have to go is another question.
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Posted by jsanchez on Friday, July 28, 2017 9:36 AM

He might have to buy new equipment, the Surface Transportation board is now watching CSX, they have been getting complaints left and right from CSX customers, some of them coal producers that are getting terrible or no servicee. There will still be coal busines for many yeas to come long after Hunters short sighted attempt to destroy CSX. The coal business is currently expanding and reopening mines, the economy as whole is growing again at a decent rate, Hunter picked a lousy time to implement severe cutbacks. CSX should be doing the opposite ramping up service.

 

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Posted by VOLKER LANDWEHR on Friday, July 28, 2017 9:39 AM

jsanchez
He might have to buy new equipment, the Surface Transportation board is now watching CSX, they have been getting complaints left and right from CSX customers, some of them coal producers that are getting terrible or no servicee.

The CSX still has equipment and it was enough to handle much higher coal traffic in former years.
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Posted by schlimm on Friday, July 28, 2017 9:48 AM

K. P. Harrier

If the above link doesn't work, you might try this one.

https://thinkprogress.org/fossil-fuels-are-dead-says-rail-baron-b177af077344

 

Thanks!   I forgot Financial Times is subscriber access.|

The coal that CSX originated/shipped is less "clean" than Powder Ridge, etc. EHH is just making a business decision based on long-term trends and prognosis.

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Posted by Euclid on Friday, July 28, 2017 10:12 AM

VOLKER LANDWEHR
From my outside view not regulations kill coal but economics. With an abundance of cheap gas why burn coal for power?

And emission regulations are necessary . How far they have to go is another question.

To your second point, I believe anti-CO2 regulations are going farther than necessary.

To your first point, this is the argument of the people who are driving the anti-CO2 regulations.  They cover their tracks by claiming that it is not they who are killing coal, but rather, it is pure economics. 

But the truth is that regulations influence the economics.  President Obama promised to kill coal and he carefully explained that he would do it with regulations. 

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Posted by Bruce Kelly on Friday, July 28, 2017 10:15 AM

Of the many resources which show it's as much to do with policy as price, there's this:

https://www.eia.gov/todayinenergy/detail.php?id=29952

Key excerpt:

"Without the Clean Power Plan, there is less incentive to switch from carbon-intensive coal to less carbon-intensive natural gas or carbon-free fuels such as wind and solar. In the scenario where the Clean Power Plan is not implemented, coal again becomes the leading source of electricity generation by 2019 and retains that position through 2032, longer than in the Reference case, which includes the Clean Power Plan. Electricity generation from renewable sources remains below coal-fired electricity generation through 2040. Fewer coal plants are retired, and as a result, natural gas and renewable capacity additions are lower compared with the Reference case."

And to understand one of the major forces working behind the scenes:

http://www.politico.com/agenda/story/2015/05/inside-war-on-coal-000002

Note that Sierra Club is not content with merely ending coal. They've already targeted natural gas as well.

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Posted by tree68 on Friday, July 28, 2017 10:27 AM

Bruce Kelly
...or carbon-free fuels such as wind and solar.

Ha!  Folks are fighting wind around here with a vigor that makes anti-coal people look positively lazy.

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Posted by jsanchez on Friday, July 28, 2017 11:08 AM

Problem is, he is not making sound business decisions, much of CSX is in melt down mode right now.

https://www.stb.gov/stb/docs/NonDocumentedPublic_Correspondence/2017/STB%20to%20CSX%20Harrison%20July%202017.pdf

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Posted by Euclid on Friday, July 28, 2017 11:41 AM

The question is asked:  “What will replace coal?”  I would say that what will replace coal is a reduction in electric consumption.  Consumers are just now starting down the fast road of eye-popping electric bills.  There is a lot of elasticity in electric consumption, and consumers are not going to just sit still and pay hundreds of dollars per month for electricity. 

It is hard to substitute for electricity, but not hard to reduce its usage.  There will be big shifts in power production requirements as the entire consumer base suddenly cuts their electric usage in half. 

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Posted by Norm48327 on Friday, July 28, 2017 11:45 AM

Euclid

The question is asked:  “What will replace coal?”  I would say that what will replace coal is a reduction in electric consumption.  Consumers are just now starting down the fast road of eye-popping electric bills.  There is a lot of elasticity in electric consumption, and consumers are not going to just sit still and pay hundreds of dollars per month for electricity. 

It is hard to substitute for electricity, but not hard to reduce its usage.  There will be big shifts in power production requirements as the entire consumer base suddenly cuts their electric usage in half.

You can contribute by permanently unplugging your computer and returning to the dark ages before the internet. Please do.

Norm


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Posted by Paul of Covington on Friday, July 28, 2017 11:57 AM

   Do we need personal attacks that contribute nothing to the subject being discussed?

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Posted by jsanchez on Friday, July 28, 2017 11:59 AM

It has been mostly natural gas that is replacing coal, wind power farms are popping up in many places, there are also new clean coal technologies still being developed.

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Posted by Euclid on Friday, July 28, 2017 12:06 PM

Norm,

I am going to switch over to diesel computers. 

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Posted by Ulrich on Friday, July 28, 2017 12:19 PM

Solar and wind and other renewable sources now supply one quarter of the world's electricity needs. CSX can read the writing on the wall. Clean energy is gaining momentum exponentially, from one year to the next. In April England announced that for the first time since the 19th century no coal was burned to produce energy. We're living in times of massive change and upheaval, the likes of which haven't been seen since the first industrial revolution. I only wish I wish I could live another hundred years to see what the world will be like then.

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Posted by Norm48327 on Friday, July 28, 2017 12:29 PM

James,

If I may add to what you said, natural gas does currently have the advantage, but how long will that last and at whose expense? As is usual, I suspect the expense will be borne by the consumer. Costs have relegated home heating oil to the back burner now that less expensive options are available.

Wind and solar power are only viable with subsidies, and as a result of the mandate for Michigan to make 10% of electric generation mandatory I have seen a 40% increase in my electric rates over the past year.

Coal is one of our vast resources and I support every effort within reason to make it as clean as we reasonably can. OTOH, green plants need Carbon Dioxide to grow and if we eliminate it from the atmosphere the greenery, including food sources, will suffer and food shortages will become the norm.

I have long been of the opinion Global Warming/Climate Change is a scam to benefit the likes of Al Gore and other elites while leaving the masses to pay for their privileges. It is beyond the pale to think humanity plays a mojor role in doing so.

I also think academics have deserted their mission to give true information to the public so they can make a rational decision either in agreement or in conflict with what they say we should believe. Universities have failed their students in many ways, leaving the latter deep in debt while reaping the rewards of their efforts. Research shows the GW data has indeed been fudged and only shows their biases.

Sorry to get political but that is what I've seen happening over the last few decades.

Norm


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Posted by blue streak 1 on Friday, July 28, 2017 1:24 PM

here is  the situation.

1.  POTUS says coal has a bright future

2.  HH Says it does not.

3.  CSX will not build any more coal hauling equipment,

5.  Reports CSX is neglecting its coal trackage ?

6.  STB investigating CSX service,

So can we twist that old advertisement ?  "  Its not nice to fool mother Trump "

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Posted by Euclid on Friday, July 28, 2017 2:27 PM

Ulrich
Solar and wind and other renewable sources now supply one quarter of the world's electricity needs.

What is your source for that?  It seems a bit high. 

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Posted by schlimm on Friday, July 28, 2017 3:01 PM

Norm48327

James,

If I may add to what you said, natural gas does currently have the advantage, but how long will that last and at whose expense? As is usual, I suspect the expense will be borne by the consumer. Costs have relegated home heating oil to the back burner now that less expensive options are available.

Wind and solar power are only viable with subsidies, and as a result of the mandate for Michigan to make 10% of electric generation mandatory I have seen a 40% increase in my electric rates over the past year.

Coal is one of our vast resources and I support every effort within reason to make it as clean as we reasonably can. OTOH, green plants need Carbon Dioxide to grow and if we eliminate it from the atmosphere the greenery, including food sources, will suffer and food shortages will become the norm.

I have long been of the opinion Global Warming/Climate Change is a scam to benefit the likes of Al Gore and other elites while leaving the masses to pay for their privileges. It is beyond the pale to think humanity plays a mojor role in doing so.

I also think academics have deserted their mission to give true information to the public so they can make a rational decision either in agreement or in conflict with what they say we should believe. Universities have failed their students in many ways, leaving the latter deep in debt while reaping the rewards of their efforts. Research shows the GW data has indeed been fudged and only shows their biases.

Sorry to get political but that is what I've seen happening over the last few decades.

 

Your post is strictly political.  Sources for your assertions?  Or just opinion?

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Posted by VOLKER LANDWEHR on Friday, July 28, 2017 4:31 PM

Euclid
Euclid wrote the following post 1 hours ago: Ulrich Solar and wind and other renewable sources now supply one quarter of the world's electricity needs. What is your source for that? It seems a bit high.

According to REN21 (Renewable Energy Policy Network for the 21st Century) 2017 report, page 33, all renewably energies, not just wind and solar, contributed 24,5% to the generation of electricity:
http://www.ren21.net/gsr_2017_full_report_en
Regards, Volker

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Posted by Ulrich on Friday, July 28, 2017 4:39 PM

Thanks Volker, I knew I was close at a quarter. Will be interesting to see what it is in 20 years.. maybe up over a half by then. 

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Posted by Saturnalia on Friday, July 28, 2017 6:35 PM

Why Harrison's statement about this is generating any sort of wonder or controversy is beyond me. This industry has been talking the winddown of coal for a decade now, and especially in the last few years.

He just stated the obvious. 

As a businessowner/manager, you aren't going to put capital into a business sector you know is dying. 

Why would CSX, or any of the Class Is, put any money into their coal franchises? In 50 years it'll all be stranded assets. No, they're going to put their money into tunnel clearances for double-stacks and other intermodal projects, plus some capacity improvements warranted by those movements. 

Much the same way as railroads stopped investing in passenger equipment in the 1950s, railroads are starting to do the same with coal. It'll be a long, slow decrease over the next 40-50 years. 

As far as locomotives, those are always going to be ordered on the basis of the entire system, instead of just one sector or another. 

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Posted by Euclid on Friday, July 28, 2017 7:55 PM

The only question is whether the pace of the wind-down matches the declaration that CSX will immediately stop buying new rolling stock or locomotives for the coal business.  That would require knowing when the coal business will end, and Harrison says he does not know that.  To me, this indicates that he expressing an ideological preference rather than a pure business decision.  So I expect that he or CSX after him will actually buy new locomotives and rolling stock as needed for the coal business as it continues for some prolonged time, though dying it may be.

 

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Posted by BaltACD on Friday, July 28, 2017 8:42 PM

Euclid
The only question is whether the pace of the wind-down matches the declaration that CSX will immediately stop buying new rolling stock or locomotives for the coal business.  That would require knowing when the coal business will end, and Harrison says he does not know that.  To me, this indicates that he expressing an ideological preference rather than a pure business decision.  So I expect that he or CSX after him will actually buy new locomotives and rolling stock as needed for the coal business as it continues for some prolonged time, though dying it may be.

Pre EHH the CSX mantra was for the 'owners' of the coal to buy the cars for the commoditiy's transportation.  Power purchases were designed to be sufficient to move the traffic that was offered by customers.  

Not buying cars to move coal is one thing.  Not buying power to move the traffic that is offered by customers to be moved is a death wish.

         

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Posted by Deggesty on Friday, July 28, 2017 8:52 PM

If the CEO thinks that his company has been buying the cars that carry the coal, he is obviously unaware of what his company has been doing.

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Posted by Norm48327 on Friday, July 28, 2017 9:32 PM

schlimm

 

 
Norm48327

James,

If I may add to what you said, natural gas does currently have the advantage, but how long will that last and at whose expense? As is usual, I suspect the expense will be borne by the consumer. Costs have relegated home heating oil to the back burner now that less expensive options are available.

Wind and solar power are only viable with subsidies, and as a result of the mandate for Michigan to make 10% of electric generation mandatory I have seen a 40% increase in my electric rates over the past year.

Coal is one of our vast resources and I support every effort within reason to make it as clean as we reasonably can. OTOH, green plants need Carbon Dioxide to grow and if we eliminate it from the atmosphere the greenery, including food sources, will suffer and food shortages will become the norm.

I have long been of the opinion Global Warming/Climate Change is a scam to benefit the likes of Al Gore and other elites while leaving the masses to pay for their privileges. It is beyond the pale to think humanity plays a mojor role in doing so.

I also think academics have deserted their mission to give true information to the public so they can make a rational decision either in agreement or in conflict with what they say we should believe. Universities have failed their students in many ways, leaving the latter deep in debt while reaping the rewards of their efforts. Research shows the GW data has indeed been fudged and only shows their biases.

Sorry to get political but that is what I've seen happening over the last few decades.

Your post is strictly political.  Sources for your assertions?  Or just opinion?

Your opinion is noted but taken with 286,000 pounds of salt. Academia is not the be all end all you seem to think it is given your propensity to demean those of lesser education. Lack of the PHD you think makes you so much smarter than the rest of us gets boring after a time. Have you ever put your hand an the throttle of a locomotive or ever pulled a pin in switching operations? I have my doubts, and just for clarification I do not claim to be an expert on anything.

I will say it again schlimm. You think, because of your being an academic you have an advantage over those who know how to make a railroad run. Those who work the rails day by day are much more in touch with reality. [Personal attack removed by moderator]

Norm


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