Railroads vs. Coal Slurry Pipelines: Case of Montana in the 70's

[Rails_West]

Re: Murphy’s above

Thanks, Murphy. I withdrew the comment you quoted. I might throw out some questions later after I’ve done some more reading.

[erikem]

That’s usually called a “mine-mouth” plant. Unfortunately, it suffers from one problem the same as the coal slurry pipeline - lack of water. The plant needs large quantities of cooling water for its steam turbines to run efficiently - why, I can’t explain well, so I’ll leave it to a mechanical engineer or someone else who understands thermodynamics and heat engines well - and that amount of water is scarce and hence zealously guarded in those coal field regions.

Some of the proposals for mine-mouth plants at Colstrip were projecting that up to half the flow of the Yellowstone river would be used for cooling water. Needless to say, this did not make Montanans very happy. (N.B. My dad was born and raised in eastern Montana and I have lots of relatives living still living in that state.)

I understand that the line losses with Ultra-High Voltage DC transmission are very low - but most lines are not that kind yet - darn near none, commercially. Also, I believe they have to be super-cooled to function that way. Again, I’ll defer to someone with more expertise on the technology.

So it may well be cheaper to haul the coal than pay the capital cost for thousands of miles of the new tranmission lines. Plus, the coal can be shipped to different plants as needs vary - the transmission lines are fixed.

HVDC transmission lines don’t need superconductors to have an advantage over AC lines. Roughly speaking, a two wire DC line can carry the same power as a three wire AC line when using the same conductor size and insulator strings. Power loss per mile with DC is a bit less than for AC. Another advantage for DC is the lack of a synchronous connection. The major disadvantage for DC is the cost and losses associated with the AC/DC conversion stations.

The dividing line is on the order of 500 miles, longer lin

[Paul_D_North_Jr]

Thanks, Erik. That’s exactly the kind of insight i was hoping someone would provide. To clarify a wee bit, because DC doesn’t have cycles or phases, the connections between different DC systems don’t need to first match up the cycles and phases as AC interconnections must, to prevent some kinds of electrical mayhem. And that’s all I know about that . . .

• Paul North.

[Falcon48]

Paul_D_North_Jr:

Bob’s memory is better than mine. The “legal settlements” he refers to were judgments from anti-trust suits which found that several railroads conspired to drive at least one of the pipeline companies out of business.

He’s also right about the water issue - a populist “hot button” - and the railroads were also successful in using the political process by lobbying to prevent Congress from granting “eminent domain” / condemnation rights to the coal slurry pipelines to obtain easements and rights-of-way across those railroads, parks, your lawn, etc.

But I suspect the biggest nail in the coffin was the development and refinement of unit train operations, which drove the cost of transporting coal by rail down to the point where the pipeline was not competitive. Although, in view of later 1980’s and 1990’s price increases by BN, one could argue that it was priced too low in the late 1970’s - whether mistakenly or deliberately to preclude the pipeline competition, who can say ?

Finally, the cost of money - capital - to invest in the pipeline soared in the late 1970’s - my first mortgage in July 1980 was at 11-3/4%, and at the time we thought we got a pretty good deal. For the huge amount of all-new money that the pipeline would have needed to get built, those interest costs were an economic ‘show-stopper’.

• Paul North.

I think you’re right about the reasons the ETSI pipeline project died. In fact, if my recollection is correct (questionable at my age), the final nail in the ETSI coffin was the first PRB coal contract UP and WRPI (CNW) made. It was with Arkansas Electric - one o

[Rails_West]

The railroads between the Powder River Basin and the Midwest refused to give the pipeline easements under their right of ways. Later, they paid millions in legal settlements but by then pipeline was dead, dead, dead. I think the railroads were foolish, the states would never have let the water been exported out of the drought prone High Plains.

“I think the railroads were foolish.”

I have been thinking, maybe they were not so foolish? What made me think about it is an article by Fred Frailey I just read. It describes the coal slurry situation in the 70’s from the perspective of BN Chairman and Vice Chairman, Lou Menk and Bob Downing.

One point from the article is that expanding and rebuilding the railroad into the Wyoming coal fields was a high risk move. To use an expression from the airplane business, it sounds to me that the BN was “betting the company” on the project. Some on the BN board were strongly against it:

“BN’s board was divided, says Downing. Two board members in particular were vociferous in their opposition to putting the company at risk in this manner. At the critical August 1974 board meeting, Menk appealed for the support of his directors and begged for them to approve the building/rebuilding plan. After the vote in favor, director Norton Simon stormed out of the meeting past a group of BN managers waiting outside. Soon thereafter he resigned.”

So, I am thinking that there was plenty of reason to be worried about something that might derail the project, like coal slurries.

The other point from the article is that the coal slurry threat was very real. The firm Bechtel claimed slurries could move coal more cheaply than railroads:

"As for coal slurry, construction giant Bechtel Corp. threw its weight behind this technology, claiming it could move coal from Wyom