Frailey on coal

[Convicted One]

Having just read Fred Frailey's article on the future of coal, I'm having a hard time seeing a down side.

 

Everything he reports seems to be in the best interest  of society.

 

New methods of gas extraction make gas abundant and cheaper = goodbye hedgefund fat cats

 Cheaper gas = my winters heating costs suddenly became more affordable

Using gas to generate electricity instead of coal = cleaner air

Keeping the coal in the ground now = it will be available for future use when needed

 Using the coal at a later date = there will probably be better carbon sequestration tech available at the future time, meaning a cleaner world

 Looks like a win-win-win-win-win situation to me.

 It's not like the coal is a "use it or lose it" proposition

 

 

[Bruce Kelly]

Not having seen Frailey's article yet, I can only say this. I agree with most of your upsides in principle, assuming the future is as promising as you hope. But I wouldn't bet the farm on things like whether or not "better carbon sequestration" will be allowed (yes, I said allowed) to develop to the level necessary to appease those who need appeasing, or that it will be able to produce electricity for a reasonable net price. The downside should be obvious, if I understand the premise of the article you mention. Coal (and to some extent, export grain) has kept America's biggest railroads on their feet through this recession. Cut coal, and it wouldn't have surprised me if BNSF and UP had wound up struggling this past year like the banks and airlines and auto makers. Buffetts or not. Here in the Northwest, just in the last year or two, there have been denials on some proposed rail-served coal-fired power plants (energy-hungry California was hoping for at least one of these), it's been announced that a rail-served power plant in northeast Oregon will be shutting down, and a rail-served power plant near Seattle now faces similar pressure to close. I'm all for cleaner air, not to mention the cleaner conscience and wonderfully cheap price for my hydro-generated electricity. But like those commercials say, coal is the engine that much of America runs on, and the engine that drives much of our railroading, at least for now.

[Modelcar]

.....Trying to promote cleaner use of fuel here in this country, and reduce our importing of foreign oil, I wish the experts would put their heads together and analyze the merits of T. Boone Pickens thoughts of putting the 18 wheelers, over the road truckers over to using natural gas.

Wouldn't that be a good size reduction of foreign oil..... 

On lowering the use of coal....Isn't it a given it would drastically effect the RR's and of course RR employment.....And greatly reduce the need for our current RR structure in this country.  More unemployment....

[Valleyline]

I doub't that world-wide use of coal would drop that much as third world countries continue their rapid economic growth. And the western railroads are already investigating west coast locations for potential coal ports. If we switch to natural gas China could become a big user of North American coal. China is bringing a new coal powered generating plant on line each week for the next 5 years.  I've  read that new discoveries in our domestic natural gas supply are 'good for another 100 years" but is that based on existing useage rates or rates that would be greatly expanded. I admit that a major switch to natural gas in the US will slow the growth of CO2 in the world's atmosphere but will fail to halt it. The idea of holding our coal deposits in reserve for future use would be a hard sell to an industry producing a legal commodity having international demand.

[selector]

 One of the often unintended and unanticipated 'benefits' to cheaper energy costs is that we make more of us who need more of it. In a generation or two we are back to the same problem...the amount of CO2 and waste heat that we need to manage.

-Crandell

[Convicted One]

selector

 One of the often unintended and unanticipated 'benefits' to cheaper energy costs is that we make more of us who need more of it. .

-Crandell

 

Well, I guess you have a point there. Perhaps one of the biggest bummers we now must live with is that we no longer have access to dirt cheap energy.

 

Generations  here got used to cheap motor fuel and cheap home heating fuel,  and built a lifestyle around it, and now that same is no longer the reality, their household  budgets are overwelmed with  covering the cost of  base "neccessities".

[Convicted One]

Valleyline

. The idea of holding our coal deposits in reserve for future use would be a hard sell to an industry producing a legal commodity having international demand.

 

H'mmm...good point. Perhaps an export tariff  on coal with the proceeds earmarked as seed money for HSR projects could be of benefit here?

[carnej1]

Convicted One

Valleyline

. The idea of holding our coal deposits in reserve for future use would be a hard sell to an industry producing a legal commodity having international demand.

 

H'mmm...good point. Perhaps an export tariff  on coal with the proceeds earmarked as seed money for HSR projects could be of benefit here?

That would be great news for other coal exporting nations like Australia and Indonesia...

[Anonymous]

So the EPA will add new regulations to mercury emissions from coal that will drive up the cost of burning coal, and cause utilities to switch to gas because it will be cheaper than complying with the new coal regulations; and the railroads will thus suffer from a loss of coal hauling business.  Mr. Frailey calls it the perfect storm.   

 

That sounds like a reasonable analysis, but doesn’t this “perfect storm” also include the impending CO2 regulation of cap-and-trade legislation, which will drive up the cost of both coal and gas, and reduce the consumption of all forms of energy?  Cap and trade, which amounts to price rationing of energy, may reduce rail transport of coal far more than the mercury regulations.  Isn’t this the real “600-pound gorilla in the living room” component of this so-called perfect storm?

 

Mr. Frailey does make reference to the CO2 regulations with this sentence: “A bipartisan effort in the Senate to limit EPA’s power to regulate carbon dioxide wouldn’t affect the mercury rules.”  In reading the paragraph containing this sentence several times, however, I am not able to exactly understand his point.  I guess he was excluding that bipartisan effort per se from automatically reversing the new law on mercury. 

 

But if I understand it correctly, we have just recently passed the point where a bipartisan effort to limit the EPA’s power to regulate CO2 was voted down in the Senate, so that horse has already left the barn.  Perhaps Mr. Frailey wrote his column just prior to this recent development.  In any case, I speculate that the Obama Administration, now having the unfettered power to impose cap and trade through the EPA, will make the mercury regulations seem mild by comparison. 

 

Moreover, the reduction in consumption imposed by cap and trade will have adverse impact on rail traffic other than just coal.      

[Convicted One]

carnej1

That would be great news for other coal exporting nations like Australia and Indonesia...

 

well hey!! just doing my part to support diversity

 

as an aside, when I use the concept of giving money to HSR interests, it's usually a metaphor for insanity...

[CSSHEGEWISCH]

Convicted One

H'mmm...good point. Perhaps an export tariff  on coal with the proceeds earmarked as seed money for HSR projects could be of benefit here?

Except for the fact that export tariffs are quite unconstitutional: Article 1, Section 9:  No tax or duty shall be laid on articles exported from any state.

[Convicted One]

CSSHEGEWISCH

Except for the fact that export tariffs are quite unconstitutional: Article 1, Section 9:  No tax or duty shall be laid on articles exported from any state.

 

Very well then, we'll just have to call it "revenue reappropriation" to be on the safe side. It's not like the constitution's provisions have protected any of us from the agenda of big gov/big business ANYWAY.

[switch7frg]

   Quentin; makes me wonder what happened to all the hype over the LPG or butane  and natural gas engines the railroads were testing??Here in AZ , one of the politicos tried to push nat. gas with the promise of  tax breaks and other flowery things. With the 18 wheelers the cetane rating of fuel can't be enhanced . I don't recall ( politicos ) best line what issue of trains  had the test results of all the testing. If the idea was that good, why isn't it in use today 

                          Cannonball

[carnej1]

switch7frg

   Quentin; makes me wonder what happened to all the hype over the LPG or butane  and natural gas engines the railroads were testing??Here in AZ , one of the politicos tried to push nat. gas with the promise of  tax breaks and other flowery things. With the 18 wheelers the cetane rating of fuel can't be enhanced . I don't recall ( politicos ) best line what issue of trains  had the test results of all the testing. If the idea was that good, why isn't it in use today 

                          Cannonball

UP had technical issues with the test units they converted (SD60M's and C40-W's)...Los Angeles Junction Railway uses mostly LNG powered locomotives...MK1200G's originally built for ATSF and UP..Pacific Harbor Lines was supposedly purchasing at least one such engine from Wabtec..

[Murphy Siding]

Modelcar

Trying to promote cleaner use of fuel here in this country, and reduce our importing of foreign oil, I wish the experts would put their heads together and analyze the merits of T. Boone Pickens thoughts of putting the 18 wheelers, over the road truckers over to using natural gas.

  I wonder why Uncle Sam couldn't convert all the postal delivery trucks to natural gas?  Here you have a big fleet of vehicles that spend every night in their garage, and never wander too far from home.

[Edward C.]

Most USPS delivery trucks do in fact run on natural gas.  They can also switch over to gasoline in minutes if the need arises.

Murphy Siding

Modelcar

Trying to promote cleaner use of fuel here in this country, and reduce our importing of foreign oil, I wish the experts would put their heads together and analyze the merits of T. Boone Pickens thoughts of putting the 18 wheelers, over the road truckers over to using natural gas.

  I wonder why Uncle Sam couldn't convert all the postal delivery trucks to natural gas?  Here you have a big fleet of vehicles that spend every night in their garage, and never wander too far from home.

[edblysard]

More than half of our city buses run on CNG, as do most of our city owned cars.

Until the mid 1980, most new homes here used gas to heat, cook, heat water and dry clothes.

But, because it is cheaper to purchase electric appliances, contractors no longer install gas appliances, and your hard pressed to find them in the big box stores like Home depot or Lowes at all.

Last oven/cooking range we purchased has a electric oven but a gas cook top, cost an additional $100.00 for the gas top and we had to order it, but I can promise you we more than made up the additional cost outlay in electric savings.

Had to go to a appliance store to buy the gas hot water heater, and the gas cloths dryer.

In fact, if I could find a old Norge gas oven and top, I would chunk the new GE in a heart beat.

Never made any sense to me to use natural gas to generate electricity to run such things when you can use the gas in its original form for a lot less energy cost .

Out in the country, you still find farmers driving old Chevy trucks with a propane tank in the back, older carburetor style engines don't require a lot to convert over, and they work just fine that way.

[garr]

edblysard

More than half of our city buses run on CNG, as do most of our city owned cars...

 

Back in the early '80's the University of Georgia tested using peanut oil in some of their older diesel buses. While walking to class I never had a problem identifying the test buses as they passed, there was a strong roasted peanut smell.

Jay 

[CSSHEGEWISCH]

A large percentage of CTA's bus fleet in the 1950's and 1960's ran on propane, you could smell the difference in the exhaust.  I believe that the price advantage of propane over diesel declined enough that the continued use of propane became uneconomical.

[Bob-Fryml]

My favorites were the hybrid, articulated city busses I saw in Seattle a number of years ago.  Somewhere near King St. Station, the diesel prime mover shuts down and the twin trolley poles go up.  Being dual-powered each of those busses must cost a small fortune, but whadda great idea! 

Of course, to this unrepentant "juice phreaque" light rail would be better.

[PNWRMNM]

Sound Transit is building an extensive light rail system powered by overhead wire.  Currently runs from Union Station to Sea-Tac.  Will use the "bus tunnel" to head north to the University District.  They claim to be headed across the lake to Redmond too.  All of this is on their web site.

Mac

[Deggesty]

garr

Back in the early '80's the University of Georgia tested using peanut oil in some of their older diesel buses. While walking to class I never had a problem identifying the test buses as they passed, there was a strong roasted peanut smell.

I wonder if anybody ever tried cottonseed oil. That certainly has a distinctive smell that was not as pleasant to me as that of peanuts. When I was growing up, there was a mill that produced cottonseed oil in the town seven miles south, and the odor of the oil hung around the mill. On the subject of cottonseed, I handled sacks of cottonseed meal and of cottonseed hulls when I worked in a general store. The sacks of hulls were no bother, but the sacks of meal always leaked meal onto my pants when I carried one.

[Paul_D_North_Jr]

Exelon - formerly Philadelphia Electric Co. around here - announced some time ago that it was going to close 2 of its 1950's era coal-fired generating plants, and sell the 'carbon offset credits' created thereby. Those plants are Cromby Station just north of Phoenixville, and Eddystone just north of Chester and south of the Phila. Intl. Airport - even though they both had extensive upgrades in the 1980's, including anti-pollution gear installed. Instead, Exelon was going to rely on its 'fleet' of nuclear-powered plants. Cromby won't be missed - it's pretty small in capacity in today's terms - but Eddystone is pretty big. However, an informed source recently told me that Exelon won't be able to close Eddystone as scheduled because of contractual commitments to generate and deliver certain quantities of power at certain time frames - there have not been enough upgrades or new builds of nuke plants or others for Exelon to honor those commitments. So that might be a harbinger that the coal decline is not as close as it might seem. Recall that John Kneiling wrote an article in Trains in the 1960's titled "Coal - Going, Going, Gone ?" that also predicted coal's demise - as Mark Twain said, the rumors of its death were premature and greatly exaggerated.

Coal: going, going, gone Trains, October 1967 page 37 How coal railroads can run downhill at a profit ( COAL, "KNEILING, JOHN G.", TRN )

That said, I thought about this a little, looked at the current actions of CSX and NS - and observed that neither of them seem have a "The sky is falling !" attitude towards this. Instead, they're both gearing up for domestic double-stack intermodal as fast as they can, each with significant corridor expansions and clearance and other improvements, etc. What I'm wondering is, perhaps they are looking at carbon limits and 'cap-and-trade' regulations as a 2-edged sword. The 'upside' for them is that diesel-fuel based trucking will become much more expensive for long hauls, which will drive much more of that traffic to them, either as intermodal or 'loose' carload. I'm not sure that the profit margins are as good as on coal - or maybe they are, or the thought or expectation is that the intermodal traffic can be made to be as profitable.

In short, rather than spending a lot of time and money and executive effort and 'political capital' fighting and bemoaning the anti-carbon fuel trend that's probably going to happen anyway regardless of what they do, it seems to me that NS and CSX are instead seeing how they can 'make lemonade out of them lemons', and find and take advantage of some way that it will benefit them. At least that's how I see it now . . . it will be interesting to see how this plays out over the next 10 to 20 years.

- Paul North.

[Anonymous]

I see two impending issues that stand to reduce coal traffic on the railroads.

 

1)      The EPA mercury regulations.

2)      The cap and trade system.

  

Mr. Frailey discussed the effect of item #1, but not item #2.

 

If both items were imposed today, I do not know which would have the larger effect on reducing the use of coal, but item #2 will reduce consumption of everything that is transported by rail, not just coal.

[miniwyo]

 One issue that Frailey should have touched on is the idea that long term, the Coal Industry and the Natural Gas industry should team up. The Natural Gas industry can go on to the mine site lease, drill to the coal bed, and remove the coal bed methane that some mines are having to deal with. then once the gas is extracted, the coal companies can go in, extract the coal and they already know where the formation is, and a good idea of how deep they need to go to get it. CBM is also a little cleaner than natural gas as it come out of the well, so it requires less processing. So you have a smaller investment on a cleaner energy.