Energy by Rail...Terminated Rail Coal by State IL 68.2 mil tons 10% TXTotal = 708.5 mil tons 62.3 mil tons 9% VA 56.1 mil tons 54.7 mil tons 8% MO WI 32.9 mil tons 5% OH 31.2 mil tons

Energy by Rail

Department of Energy Chicago, Illinois August 8, 2014

ASSOCIATION OF AMERICAN RAILROADS SLIDE 2

Coal 5,769,626

40%

Grain 936,098

6%

Chemicals 1,238,773

8%

Steel & other metal

534,849 4%

Motor veh. & parts

848,152 6%

Iron & steel scrap

217,836 2%

Crushed stone, sand

1,053,078 7%

Grain mill products 473,892

3%

Ethanol, crude petr. & petr.

products 1,015,371

7%

Metallic ores 375,859

3%

Food products 334,894

2%

Paper 317,915

2%

Other 1,529,128

10%

U.S. Rail Carload Traffic

by Commodity in 2013

Intermodal is not included.

Source: AAR Weekly Railroad Traffic


Coal by Rail


Coal Production vs. Consumption

Consumption

Production


0

50

100

150

200

250

300

350

400

450

500

WY WV KY PA IL TX MT OTHER

WY, WV, KY Dominate

Coal Production

Source: Energy Information Administration

(millions of tons, 1990-2013)


U.S. Coal Consumption

by End User

Electricity

generation

93%

Coke plants

2%

Other*

5%

*Includes combined heat and power.

Data are for 2011. Source: Energy

Information Administration


0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

Coal Natural Gas Nuclear Hydro Renewables

U.S. Electricity Generation

by Type of Fuel


(million megawatthours, 1990-2011)

Railroads Help Keep Coal-Based Electricity

SLIDE 8 ASSOCIATION OF AMERICAN RAILROADS

12%

16%

20%

24%

28%

32%

36%

40%

44%

48%

52%

Coal vs. Natural Gas as % of U.S. Electricity Generation: Jan. 2008 - May 2014


Coal

Natural gas

2008 2009 2010 2011 2012 2013 2014

trend line

trend line


109 103

75 71

89 90 84

78

58 58

49

40 43 48 50 50

59

82

59

82

107

126 118

'91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13

Metallurgical

Steam

(millions of tons)

Record Coal Exports in 2012 and 2013



Modal Distribution of Coal

Movements

*Includes "private" railroads operated by utilities or mines. Source: Energy Information Administration

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

75%

Railroad* Water Truck Tramway, Conveyor, Pipeline

COAL SHIPMENTS TO FINAL U.S. DESTINATIONS

BY MODE OF TRANSPORTATION: 1990-2013

*


300

400

500

600

700

800

900

'91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13

U.S. Rail Coal Tonnage

Data are originated tons for Class I railroads. Source: AAR

(millions of tons)


Originated Rail Coal by State

WY 415.6 mil tons

55%

WV 86.1 mil tons

11% KY 49.3 mil tons

7%

PA 33.0 mil tons

4%

MT 26.5 mil tons

4% CO

22.8 mil tons 3%

IN 22.6 mil tons

3%

IL 21.3 mil tons

3% VA 19.5 mil tons

3%

OH 15.6 mil tons

2%

Others 38.0 mil tons

5%

Data include non-Class I railroads.

Source: STB Waybill Sample

ORIGINATED RAIL TONS OF COAL BY STATE: 2012

Total = 750.2 mil tons


Terminated Rail Coal by State

IL 68.2 mil tons

10%

TX 62.3 mil tons

9%

VA 56.1 mil

tons 8%

MO 54.7 mil tons

8%

WI 32.9 mil tons

5%

OH 31.2 mil tons

4%

IN 31.0 mil tons

4% AL

29.1 mil tons 4%

MD 25.1 mil tons

4% KY

23.4 mil tons 3%

Others 294.4 mil tons

42%

TERMINATED RAIL TONS OF COAL BY STATE: 2012

Data include non-Class I railroads.


Total = 708.5 mil tons


Crude Oil By Rail


4.0

4.5

5.0

5.5

6.0

6.5

7.0

7.5

8.0

8.5

9.0

9.5

'91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13 '15e

U.S. Crude Oil Production

e - Energy Information Administration estimate Source: EIA

(millions of barrels per day)


U.S. Crude Oil Production by State: 2004-2013

*Federal offshore Gulf of Mexico Source: EIA

(millions of barrels per day)

0

400

800

1,200

1,600

2,000

2,400

2,800

TX GULF* ND CA AK OK NM LA WY CO OTHERS

% = % change from 2004 to 2013)

139%

-14%

909%

24%

179%22%-14%53%74%

-43%-16%


A lack of refineries

in areas of new

production like ND

means crude oil has

to be trans-ported to

where it can be

refined.

U.S. Oil Refineries

Source: Government Accountability Office based on EIA data as of 1/1/13

http://www.mining-technology.com/projects/thunder/


0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

2009 2010 2011 2012 2013

Terminated Carloads of Crude Oil on U.S. Class I Railroads

Source: AAR

Why Move Crude by Rail?

Geographic flexibility

Responsiveness

Efficiency

Underlying infrastructure

Isolation of commodity


http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=18peyeTlg0zvqM&tbnid=o8h7hiOfYgKY0M:&ved=0CAUQjRw&url=http://www.railwayage.com/index.php/safety/us-regulators-reviewing-crude-by-rail.html&ei=GixxUrzGCbbKsQTAx4Aw&bvm=bv.55617003,d.cWc&psig=AFQjCNG3CW_g-W_7qDxdURbbizYuFSbjvA&ust=1383234963966335


0.01% 0.02% 0.03% 0.04% 0.10%

0.22%

0.82%

1.41%

2006 2007 2008 2009 2010 2011 2012 2013

Source: AAR

Crude Oil as a % of Total Originated Class I Carloads


What Does the Future Hold for Crude by Rail?

Flexibility will remain a

key competitive

advantage

Tank car safety

improvements

Price spreads?

Pace of pipeline

expansion unclear

Bottom line: here to stay


Ethanol by Rail


40 41 47 51 63 69

112

154

220

282

325 341

307

0

50

100

150

200

250

300

350

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Ethanol by Rail (thousands of carloads)

Ethanol Carloads 2000 - 2012



Nebraska

57.0

(21%)

Illinois

22.6

(8%)

Iowa

92.4

(34%) Other

4.4 (2%)

Kansas

6.8 (3%)

N. Dakota

12.7 (5%)

Indiana

10.7 (4%)

Texas

7.4 (3%)

Total:

269.8

S. Dakota

33.2

(12%)

Origins of Ethanol by Rail

(thousands of carloads)


Minnesota

22.6 (8%)


Texas

41.4

(14%) Pennsylvania

17.3 (6%)

California

42.8

(14%)

Other

88.6

(29%)

Iowa

17.0 (6%)

N. Carolina

14.3 (5%)

Virginia

13.0 (4%)

Georgia

14.4 (5%)

Total:

301.3

New Jersey

39.8 (13%)

Destinations of Ethanol by Rail

(thousands of carloads)


New York

12.6 (4%)


Rail Investment


$6.2 $6.4 $8.5 $9.2

$10.2 $9.9 $9.8 $11.6

$13.5 $13.1 $10.5 $10.3 $10.9 $11.0 $11.3

$10.2 $11.0 $11.7

$12.1 $12.0

$16.7 $16.7

$19.3 $20.2 $21.5

$20.2 $20.7

$23.3 $25.5 $25.1

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

($ billions)

Spending by U.S. Railroads on Infrastructure & Equipment

Data are for Class I railroads. Source: AAR

Total spending

Maintenance expenses

Capital spending


$0

$2

$4

$6

$8

$10

$12

$14

'80 '83 '85 '87 '89 '91 '93 '95 '97 '99 '01 '03 '05 '07 '09 '11 '13

Roadway and Structures

Equipment

Railroad Capital Spending ($ billions, current dollars)

Data are for Class I railroads. Source: AAR


What’s This? U.S. Freight Railroad Capital Spending for Infrastructure

(average per year 2009-2013)

Total =

$8.3 billion

Rail & other track material

$2,600 mil(31%)

Ties$1,672 mil

(20%)

Ballast$975 mil

(12%)

Signals$838 mil

(10%)

Bridges, trestles & culverts$505 mil

(6%)Grading$250 mil

(3%)

Roadway machines$246 mil

(3%)

Public improvements-

const$233 mil

(3%)

Intermodal terminals$208 mil

(2%)

Land$177 mil

(2%)

Communication systems$170 mil

(2%)

Station & office buildings$139 mil

(2%)

Repair shops$77 mil

(1%)

Other$245 mil

(3%)



What’s This? U.S. Freight Railroad Capital Spending for Equipment

(average per year 2009-2013)

Total =

$3.2 billion

Locomotives$1,868 mil

(58%)

Freight cars$722 mil

(22%)Computer systems$285 mil

(9%)

Other$366 mil

(11%)



Assn. of American Railroads www.aar.org

http://www.google.com/url?sa=i&rct=j&q=amtrak+logo&source=images&cd=&cad=rja&docid=461nrpPXpZGzRM&tbnid=j1oBkkml3bAb3M:&ved=0CAUQjRw&url=http://logos.wikia.com/wiki/File:New_Amtrak_logo.png&ei=LJNAUf34GIeS9QST9IGQDw&bvm=bv.43287494,d.eWU&psig=AFQjCNFDu-SWCf1Wm2k0mP7bjlpHFlT6Sg&ust=1363272874187931

Documents

Energy by Rail...Terminated Rail Coal by State IL 68.2 mil tons 10% TXTotal = 708.5 mil tons 62.3 mil tons 9% VA 56.1 mil tons 54.7 mil tons 8% MO WI 32.9 mil tons 5% OH 31.2 mil tons