FIGURE 5.1 Schematic showing coal tonnage transported by rail in 2002 throughout the 48 conterminous states. SOURCE: Courtesy of Bruce Peterson, Center for Transportation Analysis, Oak Ridge National Laboratory.

Although continuing technology improvements may help railroads to add capacity and provide reliable delivery at a reasonable cost, it is unlikely that federally sponsored research and development will be significant contributors to such improvements—capacity, reliability, and price are all much more dependent on supply and demand, business practices, the investment climate, and regulatory oversight in the railroad industry. In addition, although the industry faces staffing constraints, worker health and safety concerns, environmental regulation, and community concerns, these issues do not threaten capacity, reliability, or price to an extent that would materially affect projections of future coal use.

Rail Capacity

Demand for transport of coal by rail has increased markedly in recent years. This is especially the case in the West, where the tonnage of coal transported on the line jointly operated by BNSF Railway Company and Union Pacific Corporation to serve the southern Powder River Basin coal fields (the “Joint Line”) (Figure 5.1) increased from 19 million tons in 1985 to 325 million tons in 2005 (UPC/BNSF, 2006). Increasing rail capacity depends on capital investments for rolling stock and additional track, and such investments require confidence that



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