Rail and the Energy Future

The future of US passenger rail is dependent on the private railroad companies. It's very unlikely that we will have a dedicated passenger rail network anytime soon, and even public ownership of rail infrastructure, except in bits and pieces, is not a major factor.

Certainly, railroads, with their ability to haul pretty much any commodity very efficiently, would seem to be well-placed to take advantage of 21st century changes. But a large percentage of what railroads haul today is energy-related: coal, oil, frack sand, and so on.

So I ask the AU experts: What happens to the railroads when more energy production comes from non-fossil-fuel sources? I assume that the electricity grid is not going away, especially for commercial and industrial users, but how are the railroads affected when residential users generate their own energy with rooftop solar (or whatever works best in their area), and they travel by transit or in vehicles with rechargeable batteries?

My understanding is that this is not going to happen in our lifetime. The RRs will not have a problem because even if all renewables were successful (which they aren't) it would still be a negligible reduction in fossil fuel use. Do you seriously believe that 330 million people are going to be using rooftop solar panels and riding the bus or driving Prius??

Apparently Bill Gates, who is very invested in his Terra reactor technology, thinks the same: http://www.wsj.com/articles/obamas-renewable-energy-fantasy-1436104555?tesla=y

Recently Bill Gates explained in an interview with the Financial Times why current renewables are dead-end technologies. They are unreliable. Battery storage is inadequate. Wind and solar output depends on the weather. The cost of decarbonization using today’s technology is “beyond astronomical,” Mr. Gates concluded.

Ditto for the Google crowd: Google engineers came to a similar conclusion last year. After seven years of investigation, they found no way to get the cost of renewables competitive with coal. “Unfortunately,” the engineers reported, “most of today’s clean generation sources can’t provide power that is both distributed and dispatchable”—that is, electricity that can be ramped up and down quickly. “Solar panels, for example, can be put on every rooftop, but can’t provide power if the sun isn’t shining.”

These are not dumb people and I don't suspect that they are under the sway of "big oil". I have personally taken more than half a dozen courses on climate, energy, renewables, sustainability etc. and can only come to the same conclusion. It is a problem, possibly a big problem, and there is no solution in sight......certainly not what we currently know as 'renewables.' Ergo, for the forseeable future, the profits of the Class I RRs are safe.

Coal only looks cheap on paper because the cost of polluted air and the resulting climate change isn't levied against the companies that most contribute to it. Just like nuclear power is cheap only if there is a government careless enough to cover the insurance, accept the resulting waste, and promise to protect millions of tons of useless but dangerous remnants with around the clock security for hundreds of millions of years. Oil is cheap if someone else is willing to spend billions protecting oil fields and patrolling naval passageways in order to ensure safe transit. If money is the issue then why aren't fossil fuel energy companies with hundreds of years head start expected to pay their own way without government support? If money is the focus then wind, solar, geothermal, hydro, and bio fuels are the obvious answer once you've factored cradle-to-grave costs. For most of the his life Bill Gates has had virtually nothing actionable to say about environmental concerns or resource exhaustion. These days he's managed to begin paying lip service to the idea of protecting the environment but he still doesn't seem to think it's any sort of immediate crises.

I think everyone understands about externalized costs and something may be done about that in future but that will not change the basic equation. Cost is a factor but it is not the main factor. Availability and reliability are actually more pressing issues that so-called renewables fall short on: these factors are simply not there at present and apparently will not ever be. Ask Germany.

Unsupported ad hominem attacks are not helpful.

We have so much natural gas in play in North America, and especially the USA, that we could convert to a NG based economy fairly quickly (10 years or less), which would change the way the railroads move energy for sure-much less need for Coal and oil cars. Our public Utilities are already shifting large numbers of plants from Coal to NG. More and more commercial fleets are switching to cleaner NG as well. It's a matter of infrastructure availability that is needed to move ahead for this fuel.

City of Miami said:

I think everyone understands about externalized costs and something may be done about that in future but that will not change the basic equation. Cost is a factor but it is not the main factor. Availability and reliability are actually more pressing issues that so-called renewables fall short on: these factors are simply not there at present and apparently will not ever be. Ask Germany. Unsupported ad hominem attacks are not helpful.

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Availability and reliability can be addressed by retiring outmoded plants with outdated technology. Plants like coal and nuclear are some of the oldest still in operation. The easiest way to retire old plants is to reduce future energy needs through more efficient use of energy already created. When it comes to energy usage we live in the world's most confused and least efficient culture where even minimal changes can result in major efficiency gains. Unfortunately that requires us to think twice before buying the bigger television or selecting the louder stereo or choosing the bigger vehicle. It also goes against decades of brainwashing us to put our needs above everyone else and ignore the long term repercussions of our short term actions.

Devil's Advocate said:

Availability and reliability can be addressed by retiring outmoded plants with outdated technology.

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I'm guessing "updated technology" is meant? If so, that would be NG? If so, I wonder how that NG (primarily methane) will be distributed to the various electricity generating plants around the country? Compressed in RR tank cars? I don't know. I would guess that would be cheaper than trying to build such a large network of pipelines.

Of course that doesn't touch the demand for liquid petroleum which is largely for transportation purposes. Mike mentions conversion to NG fleet vehicles; I suspect that is a tiny percentage of overall use and would not effect appreciably RR traffic in crude oil.

Based on my limited experience with generators, I think that NG burns at a higher temperature than liquids which is much harder on the hardware for electricity generation or locomotion. This will be a discouraging effect for large scale conversion.

No, "outmoded plants that use outdated technology" may make more sense to you.

By cutting demand, we don't have to replace as much of the old stuff, making it easier for renewables to carry the load.

I wouldn't bet against Elon Musk, with distributed batteries and solar panels everywhere.

To come back to the original question. What will happen to the railroads?

In the UK there has been a ramping down of coal for many years now. This means both coal power plants are being closed when they reach the end of their lifespan, and the remaining coal mining activities are clearly on borrowed time. But surprisingly coal haulage by railroad, when measured in tonne miles, is up. Why? Because there is a mismatch between mine closures and plant closures and the average distance over which coal needs to move is thus up, even if the total volume is down. A lot of coal is now also not coming from mines but from ports and require even longer distances of train haulage. So in the short to medium term this is extra business for railroads even if in the long term its a market that's going to disappear.

What will happen after that? Coal has of course been easy money for railroads. Road haulage is nowhere near competitive. The only thing that is cheaper than sending coal by train is sending it by ship, but many locations are not connected to navigable water. So with little fear of competition, the railroads have managed to keep coal profitable. Loss of that market will make things tougher for the railroads, but most railroad corridors, even those that see heavy coal trafic, do also see other types of train and I do believe they can make things work.

A general return to higher oil prices may give the railroads a new edge over truckers and could spur fresh growth in the industry, especially in the intermodal sector, but maybe also elsewhere. So there is positive and negative and nobody has a crystal ball.

To the person who said our oil production was declining (right from our govt sources today):

U.S. oil production is expected to reach an average of 9.5 million barrels per day this year, the most in 45 years, according to an Energy Information Administration report released Tuesday. The forecast is about 40,000 barrels per day higher than the agency's projection in June.

I agree that with the move away from Coal to fuels like NG and others it will indeed effect the railroads in negative way. The trend to more and more intermodal use for routes longer than 500 miles continues and is a big plus for the RR's. It makes good economic sense to move the vans via rail rather than pay drivers. What you lose in time you gain in cost savings big time.

Elon may be in over his head--at least when it comes to space travel. Three major disastrous space launch attempts now resulting in hundreds of millions in losses (I wonder if the stuff was insured???). He may be able to make a great looking and performing luxury car, but not sure about some of his other ventures. As far as his battery plans--LI ion batteries may be the 8-track tapes of battery technology in 10 years. My contacts in Boeing and DARPA say there are much more promising technologies in this area that will be commercialized within the next 5-10 years that will make the LI ion batteries dinosaurs. We shall see if these other folks predictions are accurate.

You know that SpaceX was only involved in one of those "disastrous" attempts, right?

What makes you think that he won't adapt new rechnology for batteries to when it becomes available?

montana mike said:

My contacts in Boeing and DARPA say there are much more promising technologies in this area that will be commercialized within the next 5-10 years that will make the LI ion batteries dinosaurs. We shall see if these other folks predictions are accurate.

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Back in the early 1980s IBM released all its licences for its x86 PC. Suddenly hundreds of low cost competitors could make IBM clones (they called them IBM coompatible). That may have lost IBM market share, but they more than made up for it in the total market share of IBM compatibles and hence software companies prioritizing their platform, squeezing out "non compatible" competitors with some of that growth ultimately falling back into IBM's lap.

Industry folks I've talked to say Elon is doing the same. He's trying to starve off more promising technologies by giving away IP for free and so creating momentum behind his rather suboptimal choices so creating a de-facto market standard that will make anything else seem like an outsider and people buying more innovative stuff seem like risk takers and managers teering them back to the safe and proven stuff.

You know the dictum "No IT manager has ever been fireed for buying Microsoft?". It could well be the same with batteries in some years.

Cirdan, very good point. Before "No IT Manager got fired for choosing Microsoft", "No IT Manage ever got fired for choosing IBM" was the in slogan too. But eventually IBM managed to get overwhelmed by their own creation which got out of their control and the random things that happened around UNIX, and IT managers did start getting fired for mindlessly choosing IBM, thus creating a huge ancillary industry of free range consultants.

So the bottom line message is that technology lifecylce can be managed to some extend but if there is truly a technology sitting in the wings with significant cost benefit advantage ultimately they become the next technology curve, specially when further strengthened by other developments in the area.

Stating that "there are much more promising technologies in this area that will be commercialized within the next 5-10 years" seems to be something that is true in many technology domains. So unless we are talking specific other technologies it is hard to assign a credibility value to that statement that is meaningful even when active management of technology curve, such as Elon is indulging in, is absent, Specifically large entrenched companies like Boeing and AT&T (the real one, not the current clone one), and even DARPA and NIST have been spectacularly wrong in projecting what technologies will succeed in the wild in the past (and in case of government agencies wasting enormous amounts of money in the process, but how would they know any better than someone else? It is a tough thing), so contacts at Boeing saying something is an interesting data point, but nothing more.

Microsoft has not had a very good past few years and with the upcoming launch of the new Windows 10 it remains to be seen if they can recapture the "Magic"

it once had!

Apple's time in the barrel will come too, book it Danno!

"Stating that "there are much more promising technologies in this area that will be commercialized within the next 5-10 years" seems to be something that is true in many technology domains."

One could also say it's perpetually true in this domain. Sometimes it even happens!

Ryan said:

You know that SpaceX was only involved in one of those "disastrous" attempts, right?

What makes you think that he won't adapt new rechnology for batteries to when it becomes available?

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2008, 2014, 2015--That's three to me......

He will have to in order to survive--technologies are evolving in a matter of months rather than years now. I send my "tech" people to training every few months now. Ten years ago they updated their knowledge annually. I won't necessarily bet against a "billionaire", but most of his $$ are tied up in equity that is supported by a company that hasn't made any money (I don't count accounting gimmicks that show they made a small amount last quarter) since its inception--amazing valuation for this effort by the Wall Street pundits......

I agree our "govt" doesn't have the greatest track record when it come to technology, but the Boeing people were burned so badly by their LI ion issues early on with the Dreamliner several years ago that they vowed to find other solutions for the long term and my cousin--a senior engineer at Boeing, says they are on or ahead of schedule to make this happen.

montana mike said:

Ryan said:

You know that SpaceX was only involved in one of those "disastrous" attempts, right?

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2008, 2014, 2015--That's three to me......

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I am not sure what you are counting as SpaceX launch attempts. Could you specifically identify what failed in 2014? Maybe you are mistakenly thinking that the launch from Virginia was a SpaceX launch attempt which it wasn't?

I count a total of four failed launches between 2006 and 2015. The first three attempts to launch failed in 2006 through 2008, all Falcon 1s and none of those from Cape Canaveral, and then the last failure was the recent 2015 one.

This was the first failure of Falcon 9. All the early failures were of Falcon 1 launches were from Omelek Island, Kwajalein. Launch 6 onwards has been from Cape Canaveral SLC-40, except for launch 11 which was from SLC 4E vandenberg, and they have all been Falcoln 9 launches with just one failure,

It seems to me that 4 failures in 24 attempts with three of those being the first three attempts is probably better than NASA's own early record. For Falcon 9 1 failure in 18 attempts is pretty darned good for any space program.

I am curious, why are you so down on Elon Musk anyway? Did he do something to you?

I am curious, why are you so down on Elon Musk anyway? Did he do something to you?

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I'm not either montana mike or Ryan, but Elon Musk trash-talked California HSR in favor of his Hyperloop back of a napkin sketch proposal. While Hyperloop strikes many as vaporware, or more generously an intriguing idea in its conceptual stage rather than anything near an engineering stage, ol' Muskie basically wind-bagged that Hyperloop would happen before CalHSR :blink: and lowballed his cost ass-pull estimate including hand-waving land costs, in an apparent effort to make CalHSR look bad. :angry2:

Yes, and that is a legitimate gripe and I am quite skeptical about Hyperloop so far with a general show me first attitude.

But that has nothing to do with the space program or the EV stuff that he is championing. There is very little evidence supporting the theory that he entirely hand waving in either of those two areas. If there is such evidence that I missed I'd like to know about it, i.e. hand waving way beyond what is standard from DARPA and NASA and such.

John Bredin said:

I am curious, why are you so down on Elon Musk anyway? Did he do something to you?

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I'm not either montana mike or Ryan, but Elon Musk trash-talked California HSR in favor of his Hyperloop back of a napkin sketch proposal. While Hyperloop strikes many as vaporware, or more generously an intriguing idea in its conceptual stage rather than anything near an engineering stage, ol' Muskie basically wind-bagged that Hyperloop would happen before CalHSR :blink: and lowballed his cost ass-pull estimate including hand-waving land costs, in an apparent effort to make CalHSR look bad. :angry2:

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We must remember, all Musk is doing for the Hyperloop is running the design contest-which is a nice idea, but he is NOT offering to build it. Yes, I have also seen other estimates on the ultimate cost of the Hyperloop project, which are enormously higher than EM's original estimate (some as much as 10 times the original cost)--which he now says, btw, was just a talking piece to get the conversation moving along.

jis said:

montana mike said:

Ryan said:

You know that SpaceX was only involved in one of those "disastrous" attempts, right?

Click to expand...

2008, 2014, 2015--That's three to me......

Click to expand...

I am not sure what you are counting as SpaceX launch attempts. Could you specifically identify what failed in 2014? Maybe you are mistakenly thinking that the launch from Virginia was a SpaceX launch attempt which it wasn't?I count a total of four failed launches between 2006 and 2015. The first three attempts to launch failed in 2006 through 2008, all Falcon 1s and none of those from Cape Canaveral, and then the last failure was the recent 2015 one.

This was the first failure of Falcon 9. All the early failures were of Falcon 1 launches were from Omelek Island, Kwajalein. Launch 6 onwards has been from Cape Canaveral SLC-40, except for launch 11 which was from SLC 4E vandenberg, and they have all been Falcoln 9 launches with just one failure,

It seems to me that 4 failures in 24 attempts with three of those being the first three attempts is probably better than NASA's own early record. For Falcon 9 1 failure in 18 attempts is pretty darned good for any space program.

I am curious, why are you so down on Elon Musk anyway? Did he do something to you?

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Did you miss these questions, Mike?