MP173 wrote: So, according to my slide rule and mental placement of decimal points, .5 cents per ton mile would translate into about $90/mile for an 18000ton coal train. That, however is on gross weight.I would assume the rates would apply on net tonnage, which would reduce the rate. Am I correct in assuming it is based on net weight?So, that 125 car coal train would generate about $65-70 per mile. A 1000 mile trip would generate $65000. What about empties?ed
So, according to my slide rule and mental placement of decimal points, .5 cents per ton mile would translate into about $90/mile for an 18000ton coal train. That, however is on gross weight.
I would assume the rates would apply on net tonnage, which would reduce the rate. Am I correct in assuming it is based on net weight?
So, that 125 car coal train would generate about $65-70 per mile. A 1000 mile trip would generate $65000. What about empties?
ed
Power River coal was selling for $6-$7 a ton, compared to $40-$50 a ton for Eastern coal. That's why PRB coal is so "popular."
If I am recalling correctly, shipping charges varied from about $5 a ton to $19 a ton depending on distance.
There must be a huge difference in performance between Eastern coal and PRB coal for there to be such a difference in $$$. I believe it is called BTU.
Thanks to all for the answers to my questions.
MP173 wrote:So, according to my slide rule and mental placement of decimal points, .5 cents per ton mile would translate into about $90/mile for an 18000ton coal train. That, however is on gross weight.I would assume the rates would apply on net tonnage, which would reduce the rate. Am I correct in assuming it is based on net weight?So, that 125 car coal train would generate about $65-70 per mile. A 1000 mile trip would generate $65000. What about empties?ed
If you want the whole cycle, a common number 1.0-1.1 cents per ton-mile (on the gross tons) for PRB coal, long-haul, and 1.4-1.5 cents per ton-mile (gross tons) for eastern coal and Colorado/Utah coal. Rates vary with value of service, cost of service, and competitive position of the coal mine in the marketplace. The eastern mines are shielded to some degree in eastern coal markets from western coal by the cumulative cost of transportation of western coal. Also, coal boilers are highly coal-specific and many boilers can't burn PRB coal or vice versa due to slagging and tube-fouling problems. The place to look is to new plants to see what they propose to burn as they look forward in the market. Existing plants tell you a lot about the market conditions predicted when they were designed, but not necessarily what the market conditions turned out to be.
S. Hadid
nanaimo73 wrote: FM-There would be less risk to the taxpayers if the $2 billion loan went to UP and BNSF to be used for increasing their capacity for moving PRB coal, perhaps including the Tongue River Railroad.Is your main concern moving the coal, or competition for BNSF ?
FM-
There would be less risk to the taxpayers if the $2 billion loan went to UP and BNSF to be used for increasing their capacity for moving PRB coal, perhaps including the Tongue River Railroad.
Is your main concern moving the coal, or competition for BNSF ?
Well, DM&E applied for the $2b loan, not UP nor BNSF. I expect that if the Duopoly twins were to apply for such a loan, they'd get it also.
The problem as I see it is in the way UP and BNSF would have spent the money, contrasted with how DM&E plans to spend the money. As you know, I am a critic of consolidating new capacity into a single corridor for various reasons. I favor dispersed capacity, and the DM&E plan fits into that concept rather nicely.
Secondly, there is the expectation of a public good in return for public funds. I can't see how doing nothing more than fattening up the already obese corporations known as UP and BNSF respectively serves any public good. If anything, such a mis-use of funds would amount to a negative public effect, given the monopolistic tendencies of those two. The DM&E plan, being a brand new dispersed and competitive line, does fit the public good criteria.
MP173 wrote: 4. I have no faith whatsoever in the utilities passing any savings along to the customers. Yeah right! As the AntiGates said so well, they are capitalists....just like me.
4. I have no faith whatsoever in the utilities passing any savings along to the customers. Yeah right! As the AntiGates said so well, they are capitalists....just like me.
As you know, most capitalists are loath to pass on savings to consumers unless forced to by competition or regulation, US railroads being a good example of that..........
However, you can be sure that any cost increases borne by the utilities will be passed on to the consumers. The UP/BNSF flustercluck in the PRB forced many utilities to purchase energy on the merchant market or generate electricity using more expensive natural gas, and most of those costs were passed on to the utility customers.
So in a way, it does save the consumers unexpected increases in their bills if the utilities can get their coal reliably and at the lowest possible cost. That's what the DM&E project will engender.
well at least we have successfully killed off the "funding DME = lower consumer electic bills" argument.
Progress, however incremental, is a good thing.
So, on a 1000 mile one way movement of 18000 tons (gross) @ 1.0 c/ton mile one would have a transportation charge of $180 per mile or $180,000 which would include the return cycle.
No doubt fuel surcharges are added to that.
With 30 trains daily on BNSF coming out of the basin that is daily revenue in excess of $5.4million or $1.9 billion per year. I will check their website to see how that equates. Lotta coin.
Just back from the BNSF website.
2005 coal revenue was $2448 Billion
2,238,000 carloads for a revenue per carload of $1094
For the 9 months of 2006:
Coal revenue is $2141 Billion, up 17.7% YTD over 05
1822 carloads, up 9.8% YTD over 05
revenue per carload is $1175 vs $1091 or 7.7% YTD
Revenue per 1000 ton miles is up 6% YTD.
Summary...coal revenue is up 17.7%, carloadings are up 9.8%, revenue per carload is up 7.7% and revenue per 1000tonmiles is up 6%.
That is pretty good growth.
1435mm wrote:Actually Northern Pacific did build into the Powder River Basin's main fields, at their northern end, Rosebud, Montana. I don't think anyone in coal mining considers Rosebud "not the main field." The coal extracted of course was only for railway fuel there being absolutely no market for PRB coal for any other purpose until the 1970s. S. Hadid
Actually Northern Pacific did build into the Powder River Basin's main fields, at their northern end, Rosebud, Montana. I don't think anyone in coal mining considers Rosebud "not the main field." The coal extracted of course was only for railway fuel there being absolutely no market for PRB coal for any other purpose until the 1970s.
I saw an eastbound coal train going through Miles City in 1969, IIRC hauled by F-units. The Western Energy and Peabody Mines in Colstrip were quite active in 1971 - got a nice tour of the 1923 vintage dragline at the Western Energy mine.
TheAntiGates wrote: well at least we have successfully killed off the "funding DME = lower consumer electic bills" argument. Progress, however incremental, is a good thing.
Nope. However assinine I may seem I still hope that cheaper transportation costs as a result of competition out of the PRB will still lower my bill.
Government has been known to operate correctly, from time to time. Hopefully our Public Service Comission will pass these savings on to consumers. If not, then one more of my predictions has failed to come true. Somehow, I think I will pull through.
TheAntiGates wrote: well at least we have successfully killed off the "funding DME = lower consumer electic bills" argument.
Ummmm, actually we've just confirmed the opposite. Clearly, if funding DM&E means a more reliable coal supply and increased competition in the PRB keeps rates down, consumers will have lower electric bills than if the DM&E project doesn't happen.
futuremodal wrote: TheAntiGates wrote: well at least we have successfully killed off the "funding DME = lower consumer electic bills" argument.Ummmm, actually we've just confirmed the opposite. Clearly, if funding DM&E means a more reliable coal supply and increased competition in the PRB keeps rates down, consumers will have lower electric bills than if the DM&E project doesn't happen.
Funding a third railroad into the Powder River Basin (whoever that may be) will only guarantee increased rail capacity to some consignees. If the mining companies sit on their hands and don't expand their loading facilities, there won't necessarily be a more reliable coal supply. Lower rail rates aren't guaranteed, either.
I would say that if the DME line is built, it would in fact lead to the potential of more reliable coal supply, if as Paul says, the infrastructure on the headend keeps up with the capacity to haul.
Lower utility rates? Not guaranteed. Lower costs for the utility may result, but lower rates for you and me? I dont buy into that. Not when there are stock options available for maximizing profit.
futuremodal wrote: nanaimo73 wrote: FM-There would be less risk to the taxpayers if the $2 billion loan went to UP and BNSF to be used for increasing their capacity for moving PRB coal, perhaps including the Tongue River Railroad.Is your main concern moving the coal, or competition for BNSF ? Well, DM&E applied for the $2b loan, not UP nor BNSF. I expect that if the Duopoly twins were to apply for such a loan, they'd get it also.
Anyone please correct me, but wasn't the loan program being used increased to $2b by a congressman from a DME state in effect, if not actual fact, for the DME to build their proposed line?
I would expect if any other railroad applied for the money, they would be turned away.
Jeff
solzrules wrote:Nope. However assinine I may seem I still hope that cheaper transportation costs as a result of competition out of the PRB will still lower my bill..
.
That word "hope" is a symbolic indicator of speculation.
Which is fine, but I hope you'll understand If I fail to draw the same conclusion based upon hopeful speculation.
Absent any binding promises in writing, my experiences in life are that often times the warm fuzzy "goodtimes will follow" pipedreams rejoiced before the fact, have an uncanny knack for finding it's way into the pockets of others when the deal is done. Cynical? yes Jaded? perhaps
"confirmed"? don't make me laugh. You are advancing speculation on top of supposition, and asking that it be accepted as an inevitability. no sale.
CSSHEGEWISCH wrote: futuremodal wrote: TheAntiGates wrote: well at least we have successfully killed off the "funding DME = lower consumer electic bills" argument.Ummmm, actually we've just confirmed the opposite. Clearly, if funding DM&E means a more reliable coal supply and increased competition in the PRB keeps rates down, consumers will have lower electric bills than if the DM&E project doesn't happen. Funding a third railroad into the Powder River Basin (whoever that may be) will only guarantee increased rail capacity to some consignees. If the mining companies sit on their hands and don't expand their loading facilities, there won't necessarily be a more reliable coal supply. Lower rail rates aren't guaranteed, either.
CSSHEGEWISCH's comment got me thinking. The DME increases the option of originating carrier by one to a total of 3. I hesitate to use "increased capacity." That makes it sound like we have open access out of the PRB. I understand railroads will detour over others at times, but that isn't guaranteed either. There are times when a railroad can't or won't take detours from another. The coal is going to move over the railroad the shipper/receiver wants, no matter if there is one or 100 trains already waiting to use that line.
The DME also may not increase the option for delivering carrier either. The UP or BNSF (and possibly in the future, the DME) may originate the coal, but they may still have to deal with another carrier(s) for final delivery. What if the connecting carrier decides to take advantage of the DME's (perceived to be at this time) lower rate to raise their own for final delivery. After all, the railroads are nothing more than evil incarnate. Or does that only apply to Class 1s in the Western region of the US? (I apologize for the last two sentences. I couldn't help myself. JLH)
What is the actual number of power plants the DME/ICE have direct access to? Weren't there originally 4 that planned to use the DME, then one or two dropped out? I know the ICE has at least 2 plants in the Quad Cities area. If any utility might be able to get a lower rate, it would be these "captive" to DME/ICE plants. Even then, I doubt the utility's customers will see any benefit of any lower transportation costs.
Personally, I hope the DME is able to build into the PRB (neutral on the funding issue, I see reasons for and against) and is successful. While I work for the UP, I don't expect the competition from them to affect me too much. I think in the future, there will be plenty of traffic to go around.
PS. I'll stop thinking now, although I'm sure some will doubt that I ever started.
Are you saying that DM&E will probably not give the BigTwo trackage rights?
The idea that these trackage rights would make any sort of difference is silly. DME is going to do it's best to use it's capacity its own self. It's not going to sit on its hands and hope Uncle Pete decides to lose revenue rather then use their own line.
Will the DME line provide additional redundancy should an accident occur? Yes! Though FM points out that some of the ROW will be parallel to the Orin line, so who knows. Will the DME regularly host UP and BNSF trains? I can't imagine why. There is no way any self respecting railroader would build a line with that kind of business plan. There's no money in physical infrastructure, that's why the Milwaukee Road's cascade route was pulled up, that's why shortlines are spun off. Even given that, If the Orin line shuts down due to accident, the DME route would be unable to support all the trains and the crisis would be lessened, but not hardly averted.
Companies don't have to be greedy capitalists to keep you from getting lower rates. This is a complex system. DME is going to enable additional plants to be built, it's going to allow transport rates to be better or more stable, but the odds of end user rates going down are low. You have to look not just at generating facilities, but transmission lines and use,etc,etc,etc. It's simply too complex a system to make the simple correlation.
The additional route is good, because additional competition, additional major rail players, additional jobs and additional Tax revenue that all that implies is good.
Trust me when I say that lower energy bills was NEVER part of the equation.
YoHo1975 wrote: Trust me when I say that lower energy bills was NEVER part of the equation.
It has been advanced in debate here, as a carrot on the stick, many times .
TheAntiGates wrote: YoHo1975 wrote: Trust me when I say that lower energy bills was NEVER part of the equation. It has been advanced in debate here, as a carrot on the stick, many times .
Hold the phone gentlemen:Read this page (http://www.gotrac.org/index.cfm?page=265) where it's clearly stated:
" It's About Reducing Electric Utility Bills
Increased shipments of clean coal from the Power River Basin will help meet growing consumer demand for electricity at lower prices.
Sounds to me like it was part of the equation.
Dan
TheAntiGates wrote: solzrules wrote: Nope. However assinine I may seem I still hope that cheaper transportation costs as a result of competition out of the PRB will still lower my bill.. That word "hope" is a symbolic indicator of speculation. Which is fine, but I hope you'll understand If I fail to draw the same conclusion based upon hopeful speculation. Absent any binding promises in writing, my experiences in life are that often times the warm fuzzy "goodtimes will follow" pipedreams rejoiced before the fact, have an uncanny knack for finding it's way into the pockets of others when the deal is done. Cynical? yes Jaded? perhaps Since the man receiving the loan is in no position whatsoever to set my electric rates, I have to channel my speculation into a less liberal outlook
solzrules wrote: Nope. However assinine I may seem I still hope that cheaper transportation costs as a result of competition out of the PRB will still lower my bill..
Since the man receiving the loan is in no position whatsoever to set my electric rates, I have to channel my speculation into a less liberal outlook
Nothing is for sure except birth, death, and taxes. Everything else is based on hope, my good friend. (Nice use of the term 'liberal' to describe my way of thinking - had a bit of a laugh over that one.)
Here's a real ham dinger. If we allowed more oil refineries to be built in this country the price of oil wouldn't jump 8 billion dollars a barrel everytime a muslim decides to live out one of the tennants of ther faith. Increasing the capacity of the industry, whether coal or oil, will help the market decide what the price is, not the few people in charge of the industry. If one or two entities have a stranglehold on any part of the manufacturing process (be it coal or oil or toilet paper) then the potential for price fixing and supply disruptions is much higher.
spokyone wrote:I see that BNSF filed a paper with the STB stating that if PRB coal is shipped on proposed DM&E line, it would interfere with intermodal traffic, specifically at Savanna Junction. Can anyone explain that.
Coal trains from DME heading to Chicago would cross the Mississippi River at Savanna on IC&E's former Milwaukee Road line, probaly very slowly. BNSF's busy line from the west coast and the Twin Cities crosses this line at the eastern end of the bridge, before splitting into lines to Chicago and Galesburg.
http://terraserver.microsoft.com/image.aspx?T=1&S=11&Z=15&X=1838&Y=11658&W=1&qs=%7csavanna%7c%7c
http://www.rrpicturearchives.net/showPicture.aspx?id=57249
That is a pretty lame excuse for BNSF regarding the slowing of intermodal traffic.
No doubt their own coal trains affect the movements of intermodal trains not only on their line but at other crossings. I dont know for sure, but suspect that ICE controls that crossing. I believe they have an operator at that point which controls the bridge over the Mississippi, and probably the crossing.
OH CRAP! Can you say "hold up for a couple of eastbound coal trains"?
spokyone wrote: JeffAre you saying that DM&E will probably not give the BigTwo trackage rights?
As a daily regular operation, I doubt either BNSF or UP would want trackage rights. I was referring more to the possibililty of BNSF or UP detouring over DME in the event the current joint line is temporarily closed for whatever reason. The argument about there being another option to keep coal moving.
It's not that DME would not let either detour in an emergency, it's IF or how many they CAN let detour. Will the DME have enough excess capacity to handle extra traffic? At first I'm sure they will, but what about in the future? Also physical plant is only part of the capacity issue, what about crew availability for extra traffic? If the UP would want to detour 3 trains, do they have enough crews at all crew points available to handle 3 extra trains? If you're tight on capacity for any reason, you aren't going to hurt yourself to help out your competitor.
Besides, I don't think the DME is building this line with the idea of being a relief valve for BNSF or UP trains. They want the revenue from originating their own trains, not just a fee from someone else using their line. They want a piece of the pie, not just the crumbs left over.
MP173 wrote: No doubt their own coal trains affect the movements of intermodal trains not only on their line but at other crossings. I dont know for sure, but suspect that ICE controls that crossing. I believe they have an operator at that point which controls the bridge over the Mississippi, and probably the crossing.
Perhaps this is just a ploy by BNSF to gain control of the crossing.
nanaimo73 wrote: MP173 wrote: No doubt their own coal trains affect the movements of intermodal trains not only on their line but at other crossings. I dont know for sure, but suspect that ICE controls that crossing. I believe they have an operator at that point which controls the bridge over the Mississippi, and probably the crossing. Perhaps this is just a ploy by BNSF to gain control of the crossing.
BINGO
nanaimo73 wrote: spokyone wrote:I see that BNSF filed a paper with the STB stating that if PRB coal is shipped on proposed DM&E line, it would interfere with intermodal traffic, specifically at Savanna Junction. Can anyone explain that.Coal trains from DME heading to Chicago would cross the Mississippi River at Savanna on IC&E's former Milwaukee Road line, probaly very slowly. BNSF's busy line from the west coast and the Twin Cities crosses this line at the eastern end of the bridge, before splitting into lines to Chicago and Galesburg.http://terraserver.microsoft.com/image.aspx?T=1&S=11&Z=15&X=1838&Y=11658&W=1&qs=%7csavanna%7c%7chttp://www.rrpicturearchives.net/showPicture.aspx?id=57249
Anyone outside of a BNSF disciple should be rather indignant over this latest BS job by Matt Rose and BNSF. This latest attempt to delay or deny the DM&E project from going forward is almost comical.
ICE could just as well claim that BNSF's trainloads of Chinese imports are delaying domestic coal shipments at this crossing. Hmmmmm, maybe they should!
Here's the same item from ProgressiveRailroading.com:
http://www.progressiverailroading.com/freightnews/article.asp?id=9938
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