Railroads: Adapting to the Changing Energy Policies

Changing environmental policies in the United States are affecting railroads. The increased government regulations and global awareness surrounding fossil fuels has resulted in a lower amount of coal being burned in the United States, as well as a lower amount of coal being exported. Lower coal use in the United States and reduced exports have led to reduced carloads shipped on railways. Coal traffic makes up a significant amount of traffic shipped by U.S. railways. Supplementing lost carloads of coal traffic is a challenge faced by today’s railroads. Exploration of alternate energy methods such as solar energy, wind energy, hydro energy, nuclear energy, biomass energy, petroleum, and natural gas to determine how these different energy sources influence the railway carloads is needed for railroads to make an informed decision to successfully move forward. Understanding which energy sources could potentially lead to additional carloads transported by rail is important for railroads to factor when deciding which infrastructure segments should be focused on for capital improvements or expansion. U.S. railways should adjust their business focus towards converting long-haul highway truck traffic to transportation by rail. Capitalizing on the shortage of long-haul truck drivers and the degrading highway system is a possibility for railways. Focused marketing to convert truck traffic to rail transportation is not only beneficial for railways, but also reduces highway congestion. Discovering ways to offset the lost coal carloads because of the changing energy policies will be critical for the future of the United States railroads.