High-speed railroading

[RandomGuy]

Interesting article about the state of rail in the US.

It also shows an interesting push for re-regulation (de-regulated during the last year of the Carter administration) of the industry by certain business interests, and makes a pretty fair argument against such a move.

It also shows that the capacity demand from shipping coal for electricity is putting some strain on the system. New coal power plants will have to charge customers more to make up for the not insubstantial cost increases of shipping coal.

American railways
High-speed railroading
America’s system of rail freight is the world’s best. High-speed passenger trains could ruin it.

UNION STATION in Los Angeles has been restored as a fine example of the Art Deco architecture that typified California in the 1930s. It has served as a backdrop for many Hollywood films, from “Union Station” (naturally) to “Blade Runner” and “Star Trek: First Contact”. It was the last grand station to be built before America’s passenger railways went into what you might call terminal decline.

Today it is a hub for Metrolink commuter trains and Amtrak services to faraway cities such as Chicago and Seattle. These trains have to pull in and then back out in a clumsy manoeuvre. But there are plans for through tracks in time to carry the high-speed services that California is desperate to have by 2020 under an ambitious $42 billion plan to connect San Diego, Los Angeles, San Francisco and Sacramento.

California’s plans were given a boost by Barack Obama’s stimulus package last year. This earmarks a lump sum of $8 billion, plus $1 billion a year, to help construct fast rail corridors around America (see map). Such lines are common in Europe, Japan and, increasingly, China, yet the only thing at all like them in America is Amtrak’s Acela service from Boston via New York to Washington, DC. It rarely reaches its top speed of 150mph (240kph) and for much of the way manages little more than half that, because the track is not equipped for higher speeds. Acela, like virtually all trains run by publicly owned Amtrak, has to use tracks belonging to freight railways, whose trains trundle along at 50mph; passenger trains must stick below 80mph. Despite the excitement of railway buffs and the enthusiasm of environmentalists, high-speed rail in America is likely to mean a few more diesel-electric intercity trains at 110mph, not swish electric expresses going nearly twice as fast.

But the problem with America’s plans for high-speed rail is not their modesty. It is that even this limited ambition risks messing up the successful freight railways. Their owners worry that the plans will demand expensive train-control technology that freight traffic could do without. They fear a reduction in the capacity available to freight. Most of all they fret that the spending of federal money on upgrading their tracks will lead the Federal Railroad Administration (FRA), the industry watchdog, to impose tough conditions on them and, in effect, to reintroduce regulation of their operations. Attempts at re-regulation have been made in Congress in recent years, in response to rising freight rates. “The freight railroads feel they are under attack,” says Don Phillips, a rail expert in Virginia.



America’s railways are the mirror image of Europe’s. Europe has an impressive and growing network of high-speed passenger links, many of them international, like the Thalys service between Paris and Brussels or the Eurostar connecting London to the French and Belgian capitals. These are successful—although once the (off-balance-sheet) costs of building the tracks are counted, they need subsidies of billions of dollars a year. But, outside Germany and Switzerland, Europe’s freight rail services are a fragmented, lossmaking mess. Repeated attempts to remove the technical and bureaucratic hurdles at national frontiers have come to nothing.


Staggering progress

Amtrak’s passenger services are sparse compared with Europe’s. But America’s freight railways are one of the unsung transport successes of the past 30 years. They are universally recognised in the industry as the best in the world.

Their good run started with deregulation at the end of Jimmy Carter’s administration. Two years after the liberalisation of aviation gave rise to budget carriers and cheap fares, the freeing of rail freight, under the Staggers Rail Act of 1980, started a wave of consolidation and improvement. Staggers gave railways freedom to charge market rates, enter confidential contracts with shippers and run trains as they liked. They could close passenger and branch lines, as long as they preserved access for Amtrak services. They were allowed to sell lossmaking lines to new short-haul railroads. Regulation of freight rates by the Interstate Commerce Commission was removed for most cargoes, provided they could go by road.

Before deregulation America’s railways were going bust. The return on capital fell from a meagre 4.1% in the 1940s to less than 3% in the 1960s. In 1970 the collapse of the giant Penn Central caused a huge shock, including a financial crisis. By 1980 a fifth of rail mileage was owned by bankrupt firms. Rail’s share of intercity freight had slumped to 35% from 75% in the 1920s. Tracks were neglected and fell into disrepair, leading to a downward spiral of speed restrictions and deteriorating service. The term “standing derailment” was coined to describe the toppling-over of stationary freight wagons when the track gave way beneath their wheels.

Several factors had combined to bring about this sorry state of affairs. Services and rates were tightly regulated. Companies were obliged to run passenger services that could not make a profit. And road haulage received a huge boost from the building of the interstate highway system, which began in the late 1950s. Although this was supposed to be financed by taxes on petrol and diesel, railmen saw it as a form of subsidy to a new compe or, the nationwide trucking industry. In a neat twist, the poor condition of today’s highways and the lack of public money for repairs have tilted the compe ive advantage back to a rejuvenated rail-freight industry.

Giving the railroads the freedom to run their business as they saw fit led to dramatic improvements. The first result was a sharp rise in traffic and productivity and fall in freight costs. Since 1981 productivity has risen by 172%, after years of stagnation. Adjusted for inflation, rates are down by 55% since 1981 (see chart 1). Rail’s share of the freight market, measured in ton-miles, has risen steadily to 43%—about the highest in any rich country.


The $34 billion purchase last year by Warren Buffett’s Berkshire Hathaway of Burlington Northern Santa Fe (BNSF), one of the seven main freight railways (see chart 2), opened many Americans’ eyes to the industry’s significance. That America’s shrewdest investor should place his biggest bet on BNSF focused attention on how the country’s railways have been quietly boosting the economy by sucking costs out of many supply chains.

.Coal is the biggest single cargo, accounting for 45% by volume and 23% by value. More than 70% of coal transport is by rail. As demand grows for the lower-sulphur coal from the Powder River Basin in Wyoming, it has to travel farther. In response railroads have invested in more powerful locomotives to haul longer coal trains: since 1990 the average horsepower of their fleet has risen by 72%. Yet energy efficiency has also improved. Lighter, aluminium freight wagons, double-decker ones and more fuel-efficient locomotives have lifted the number of ton-miles per (American) gallon of fuel from 332 to 457—an improvement of 38%.



But the fastest-growing part of rail freight has been “intermodal” traffic: containers or truck trailers loaded on to flat railcars. The number of such shipments rose from 3m in 1980 to 12.3m in 2006, before the downturn caused a slight falling back. Behind this lies the tide of imports coming into the West Coast ports of Long Beach and Los Angeles. A special rail expressway for freight, the Alameda Corridor, was opened in 2002 to link the ports to the big national rail routes, bypassing the 200 level crossings (grade crossings, in America) on the original branch lines that used to cause huge traffic jams on the roads as mile-long freight trains rumbled across. The corridor, one of the biggest infrastructure projects in modern America, was completed on time and on budget for $2.4 billion by a public-private partnership considered by many to be a model for other rail schemes, such as California’s proposed high-speed passenger line.

.Despite lots of investment—amounting to $460 billion since 1980, and equivalent to 40% of revenues in recent years—capacity constraints and rising fuel costs pushed up freight rates from 2003 until the onset of recession, since when they have levelled off. This has caused unhappiness among some coal companies which have no alternative means of transport. Although most American rail corridors involve two railroads covering the same origin and destination points, in reality compe ion is limited. Usually one route is more direct than the other, and if a mining company has sidings and a branch line linked to one railroad it cannot quickly and easily switch to another. Even so, American rail freight is among the cheapest in the world, costing less than half as much as in Japan or Europe. After adjusting for differences in purchasing power it is cheaper even than in China (see chart 3).



But the past ten years have seen another source of growth, as interstate highways have become clogged in places and have shown the effects of a lack of investment. Since one freight train can carry as much as 280 lorries can, railways can help to limit the rise in road congestion. Trucking companies such as J.B. Hunt have come to see the advantage of putting trailers on flat wagons for long-haul and using roads only for local pickup and delivery. This move was also spurred, according to Mr Phillips, by a shortage of lorry drivers. He says that tougher drink-driving rules and social changes have shrunk the numbers of “good ole boy” truckers inured to a life on the road. Most hauliers now suffer labour turnover of 100% a year.

Freight railways’ very success is starting to create difficulties for them. The Department of Transportation estimates that many are already exceeding their theoretical capacity and are congested. It estimates that lots more investment will be needed, because capacity will have to rise by nearly 90% to meet forecast demand by 2035. The investment bill could rise yet more because of a change in the pattern of trade: in 2014 the Panama Canal opens a second lane, doubling its capacity and allowing it to carry bigger container vessels and bulk ships. Coming through to Gulf of Mexico and East Coast ports, these vessels will increase the need for better rail links inland.

In addition the freight railroads face a $15 billion bill for a new safety system to control trains on lines that also carry passengers or dangerous chemical cargoes. This system, Positive Train Control (PTC), is intended to stop or slow a train automatically if a driver goes too fast or passes a red signal. The bill to introduce PTC was signed by George Bush in 2008 only a month after a crash between a Metrolink commuter train and a Union Pacific freight train in California, causing 25 deaths and 135 injuries. The railway companies complain that only 3% of crashes are caused by the sort of human error that PTC is designed to avert and that claims that the system will improve efficiency on the network are unfounded. Whereas the FRA says that the new safety system will apply to only 65,000 miles (out of a total of over 140,000), the industry reckons it will cover more than half the network. The railways are seeking tax breaks and other subsidies to reduce the cost of complying.

Another looming threat is re-regulation. Fed up with increasing rates, customers, notably chemical, coal, agribusiness and utility companies, are complaining that these are evidence that the railroads are abusing their market power. The railroads retort that despite record traffic and profits, their return on investment since 2000 has been only 8%, which according to the Surface Transportation Board, another federal regulator, barely covers the cost of capital. They also say that freight rates are usually governed by what their compe ors—ie, truckers—charge. When higher diesel costs put up trucking rates, the railways follow suit.

Politicians from West Virginia have been pushing a bill in Congress that threatens to re-regulate the railways. The industry seems confident it will not get through, but risks will remain: opposing PTC could play into the hands of those who wish to increase oversight. In his annual letter to shareholders in February Mr Buffett said that BNSF, like Berkshire Hathaway’s electric utilities, required “wise regulators who will provide certainty about allowable returns so that we can confidently make the huge investments required to maintain, replace and expand the plant.”

The emergence of express intercity rail services may cause the freight railways the biggest problem of all. The policy is not only laid down by the president but also often has enthusiastic support at state level. The railways can hardly oppose Mr Obama’s plan to boost high-speed rail, but they are apprehensive about what it will mean for them.

.The problem is not the creation of new corridors with trains rattling along at 150mph. Such lines, like those proposed in California or between Tampa and Orlando in Florida, would have their own track, separated from existing lines though on the same strip of land as a freight railway. The expertise to build and run these lies mainly in Europe and Japan, where engineering firms and the technology and consulting arms of national railways have been eyeing the American market eagerly.

The trouble for the freight railways is that almost all the planned new fast intercity services will run on their tracks. Combining slow freight and fast passenger trains is complicated. With some exceptions on Amtrak’s Acela and North East corridor tracks, level crossings are attuned to limits of 50mph for freight and 80mph for passenger trains. But Mr Obama’s plan boils down to running intercity passenger trains at 110mph on freight tracks. Add the fact that freight trains do not stick to a regular timetable, but run variable services at short notice to meet demand, and the scope for congestion grows.


Return of regulation

The freight railroads have learned to live with the limited Amtrak passenger services on their tracks. Occasionally they moan that Amtrak pays only about a fifth of the real cost of this access. Some railmen calculate that this is equivalent to a subsidy of about $240m a year, on top of what Amtrak gets from the government. Freight-rail people regard this glumly as just part of the cost of doing business, but their spirits will hardly lift if the burden grows.

Their main complaint, however, is that one Amtrak passenger train at 110mph will remove the capacity to run six freight trains in any corridor. Nor do they believe claims that PTC, due to be in use by 2015, will increase capacity by allowing trains to run closer together in safety. So it will cost billions to adapt and upgrade the lines to accommodate both a big rise in freight traffic and an unprecedented burgeoning of intercity passenger services. Indeed, some of the money that the White House has earmarked will go on sidings where freight trains can be parked while intercity expresses speed by.

Federal and state grants will flow to the freight railroads to help them upgrade their lines for more and faster passenger trains. But already rows are breaking out over the strict guidelines the FRA will lay down about operations on the upgraded lines, such as guarantees of on-time performance with draconian penalties if they are breached and the payment of indemnities for accidents involving passenger trains. The railroads are also concerned that the federal government will be the final arbiter of how new capacity created with the federal funds will be allocated between passenger and freight traffic. And they are annoyed that there was little consultation before these rules were published.

There have been some heated meetings between freight-railroad managers and FRA officials. Henry Posner III, chairman of Iowa Interstate Railroad, ruefully notes that freight railroads, in the form of passengers and regulation, “are getting back things that caused trouble”.

[boutons_deux]

Americans have been taught that railroads suck, Amtrak sucks, to the benefit of personal cars and airplanes. In the exposay do entary, Who Killed Roger Rabbit, we learned how GM killed So Cal light rail so it could sell more cars.

America is too big for, eg, coast-to-coast, passenger traffic, but there are regions, like DAL-HOU-AUS-SA, that could be very well served by high-speed traffic, but Southwest Airlines bought enough corrupt TX politicians to kill Texas's TGV.

corporations, they've ed us over enough, long ago.

[RandomGuy]

energy efficiency has also improved. Lighter, aluminium freight wagons, double-decker ones and more fuel-efficient locomotives have lifted the number of ton-miles per (American) gallon of fuel from 332 to 457—an improvement of 38%.

Another intresting development is the advante of carbon-fiber technologies.

The Boeing Dreamliner (787) gained some solid fuel efficiency gains from using such tech over aluminum.

If rolling stock (cars) for US rail systems start using that in large quan ies, one could see a similar gain in fuel efficiency for rails, coupled with a loss of demand for aluminum.

Interesting to see how that plays out.

[boutons_deux]

"fuel efficiency for rails"

A huge inefficiency in USA is diesel-electric trains, (diesel drives electric generator that drives wheel motors) vs all electric like the Euro/TGV high-speed trains (England is still diesel and diesel electric, but England doesn't consider itself part of Europe, anyway )

A problem with carbon fiber is that when it's burned, the carbon particles are very polluting AND conductive (getting into electrical equipment).

[RandomGuy]

Americans have been taught that railroads suck, Amtrak sucks, to the benefit of personal cars and airplanes. In the exposay do entary, Who Killed Roger Rabbit, we learned how GM killed So Cal light rail so it could sell more cars.

America is too big for, eg, coast-to-coast, passenger traffic, but there are regions, like DAL-HOU-AUS-SA, that could be very well served by high-speed traffic, but Southwest Airlines bought enough corrupt TX politicians to kill Texas's TGV.

corporations, they've ed us over enough, long ago.

The problem is not the creation of new corridors with trains rattling along at 150mph. Such lines, like those proposed in California or between Tampa and Orlando in Florida, would have their own track, separated from existing lines though on the same strip of land as a freight railway. The expertise to build and run these lies mainly in Europe and Japan, where engineering firms and the technology and consulting arms of national railways have been eyeing the American market eagerly.

The trouble for the freight railways is that almost all the planned new fast intercity services will run on their tracks. Combining slow freight and fast passenger trains is complicated. With some exceptions on Amtrak’s Acela and North East corridor tracks, level crossings are attuned to limits of 50mph for freight and 80mph for passenger trains. But Mr Obama’s plan boils down to running intercity passenger trains at 110mph on freight tracks. Add the fact that freight trains do not stick to a regular timetable, but run variable services at short notice to meet demand, and the scope for congestion grows.

Corporations are not, in and of themselves, evil, and on the balance their advent has been very good for humanity in general.

I am all for cost/benefit. If high-speed rail is a good idea, then it is a good idea.

I tend to agree with libertarians, like Wild Cobra, that we should try to make such things ultimately profitable.

But,

I don't mind some government investment in infrastructure though. Such things tend to benefit us all in the long run.

[Wild Cobra]

Corporations are not, in and of themselves, evil, and on the balance their advent has been very good for humanity in general.

I am all for cost/benefit. If high-speed rail is a good idea, then it is a good idea.

I tend to agree with libertarians, like Wild Cobra, that we should try to make such things ultimately profitable.

But,

I don't mind some government investment in infrastructure though. Such things tend to benefit us all in the long run.

Thanx for the acknowledgment.

My two cents worth.

High speed rail requires far more costly maintenance than normal lines. I don't see it as being practical.

Amtrak losses money and is highly subsidized. If the ticket prices cannot pay for the service, then I say eliminate it.

[boutons_deux]

"Corporations are not, in and of themselves, evil,"

In practive, most of the Big Ones are evil, in that seeking to maximize their profits, they use their power to suck privileges, tax breaks, subsidies to themselves.

oil/coal/gas are wonderful examples of how corporate power blocks progress to a lower-carbon economy, while polluting air/land/water.

BigFood is evil because it produces industrial food-like substances that are pathogenic.

BigPharma is evil because it produces drugs that maim and kill 1000s as a cost of doing business, because it perverts drugs approval studies by doing its own studies and hiding negative results, because it perverts FDA and doctors with $$$.

etc, etc.

In theory, corporations searching to maximize their profits no matter what the costs are to people, environment, and country is inherently evil. And we're living that evil now.

[Nbadan]

"Corporations are not, in and of themselves, evil,"

In practive, most of the Big Ones are evil, in that seeking to maximize their profits, they use their power to suck privileges, tax breaks, subsidies to themselves.

oil/coal/gas are wonderful examples of how corporate power blocks progress to a lower-carbon economy, while polluting air/land/water.

BigFood is evil because it produces industrial food-like substances that are pathogenic.

BigPharma is evil because it produces drugs that maim and kill 1000s as a cost of doing business, because it perverts drugs approval studies by doing its own studies and hiding negative results, because it perverts FDA and doctors with $$$.

etc, etc.

In theory, corporations searching to maximize their profits no matter what the costs are to people, environment, and country is inherently evil. And we're living that evil now.

If you think about it, those are weaknesses in govt we the people, through apathy or media manipulation, have let corporations pervert regulation and oversight

[boutons_deux]

"If you think about it"

thanks for the suggestion, I'll give it a go.

[boutons_deux]

"High speed rail requires far more costly maintenance than normal lines"

evidence? "it's obvious" isn't evidence.

[LnGrrrR]

Thanks for the article RG, a good read. I would love high-speed rail, but I agree it's only feasible in a few situations.

Speaking of which though, my wife and I have always wanted to see DC and we're going back to Boston to see my family this year. I'm gonna look up tickets prices and times...

[Wild Cobra]

"High speed rail requires far more costly maintenance than normal lines"

evidence? "it's obvious" isn't evidence.

Hmmm...

How do I relate my years of experience concerning motion and physics to you?

It's simple. The faster you go, the more bumps tend to make you lift off the road, or track. maintain a smooth rail requires extensive maintenance, and more stringent standards. I'm not going to bother linking a course in physics for you.

[boutons_deux]

There are plenty of studies showing that high-speed rail beats planes up to about 400 miles (aka regional transport). Chicago/Great Lakes/St Louis/Toronto, n/e corridor, FLorida, Texas, plus the one going into CA, Portland/Seattle/Vancouver, lots of regions where rail is feasible.

[LnGrrrR]

Hmmm...

How do I relate my years of experience concerning motion and physics to you?

It's simple. The faster you go, the more bumps tend to make you lift off the road, or track. maintain a smooth rail requires extensive maintenance, and more stringent standards. I'm not going to bother linking a course in physics for you.

Fair enough. I don't know if you've proved HOW MUCH more costly they'd be, but I can run with the idea that passengers probably want to be more comfortable and travel faster than giant piles of coal.

[Wild Cobra]

There are plenty of studies showing that high-speed rail beats planes up to about 400 miles (aka regional transport). Chicago/Great Lakes/St Louis/Toronto, n/e corridor, FLorida, Texas, plus the one going into CA, Portland/Seattle/Vancouver, lots of regions where rail is feasible.

So?

At what cost?

Take the government subsidies away from AMTRAK, and how much does that ticket now cost?

[Wild Cobra]

Fair enough. I don't know if you've proved HOW MUCH more costly they'd be, but I can run with the idea that passengers probably want to be more comfortable and travel faster than giant piles of coal.

I don't know how much more costly it would be. To me, it doesn't matter. Rail is already very expensive as a passenger service. Amtrak is only affordable because tax dollars subsidize it. I think it's insane to make a high speed rail system unless someone can pay for it and make it work without subsidies. If there is a supply of willing riders at the needed ticket price, them I'm game.

Let's face it. Passenger rail died when the postal service stopped shipping mail that way in the 60's. This paid for most the cars on a train, and additional cars were relatively cheap to add.

[boutons_deux]

"the faster you go, the more bumps tend to make you lift off the road, or track"

The French mastered this kind of rail bed stability and welded/seamless rails for their TGV 25 years ago. China is doing high-speed rail and bidding on work in the USA.

USA now has a feckless, less CAN'T-DO mentality.

[Wild Cobra]

"the faster you go, the more bumps tend to make you lift off the road, or track"

The French mastered this kind of rail bed stability and welded/seamless rails for their TGV 25 years ago. China is doing high-speed rail and bidding on work in the USA.

USA now has a feckless, less CAN'T-DO mentality.

OK...

If you say so Fecklar.

[boutons_deux]

figured you wouldn't be able to come back,

[DarrinS]

USA now has a feckless, less CAN'T-DO mentality.

No. Thankfully, people like you are a loud, but weak, minority.

[LnGrrrR]

b_d, do you have numbers on costs for high-speed vs old-school rail transit? Just wondering.

[boutons_deux]

no, I don't have the numbers, but when Europe and China have proven high-speed networks, for decades in the case of France, why would USA build more 19th rail?

The diesel-electric stuff is ok for moving bulk, but not for moving people.

[xrayzebra]

We need railroads like we need another Obama in the White House. Does anyone
remember when you get where your going you still have to get to your destination.
They are great for freight, you know the stuff trucks deliver to the stores.

That may be just a tad deep for some of you........


Besides why do we need railroads when we have plenty of oil to make gas to
put in those nice big SUV's and do your thing in your own time........ahhh.
I loved it when people had common sense.

[LnGrrrR]

no, I don't have the numbers, but when Europe and China have proven high-speed networks, for decades in the case of France, why would USA build more 19th rail?

The diesel-electric stuff is ok for moving bulk, but not for moving people.

Not sure about China, but Europe is obviously more condensed, making it slightly more logical. From what the article said though, even European high-speed rail requires gov't subsidies, correct?

[boutons_deux]

What's a nation, or even nations, in Europe is a region in USA.

France is about the same size as TX.

Regional and metropolitan rail makes sense in USA, not coast-to-coast passenger rail. The studies are done, the US regions/cities are defined.