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Railroads and Ethanol Association of American Railroads September 27, 2007. North America’s Rail Network: Extensive, Efficient & Integrated. Today’s U.S. Freight Railroad Environment. Vast majority privately-owned Generally owner and operator Access privately negotiated, voluntary
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Railroads and Ethanol Association of American Railroads September 27, 2007
North America’s Rail Network: Extensive, Efficient & Integrated
Today’s U.S. Freight Railroad Environment Vast majority privately-owned Generally owner and operator • Access privately negotiated, voluntary • Historically very low government funding Freight & passenger are separate
Freight Rail Provides Major Public Benefits Railroad Fuel Efficiency (Ton-Miles Per Gallon) Cost effectiveness Fuel efficiency Reduced congestion and highway costs Environmental benefits Safety
Class I Railroad Traffic in 2006 (Gross Freight Revenue) Intermodal* - $11.5 bil Coal - $10.8 bil Chemicals - $6.0 bil Transportation equipment - $4.2 bil Farm products (mainly grain) - $4.2 bil Ethanol = ~$325 million Food - $3.7 bil Lumber & wood - $2.3 bil Primary metal products (e.g., steel) - $2.2 bil Pulp & paper - $2.1 bil Stone, clay & glass products (e.g., cement) - $1.7 bil Nonmetallic minerals (e.g., sand, gravel) - $1.5 bil Source: AAR *Estimated. Some intermodal revenue is also included in individual commodities.
U.S. Ethanol Production is Rising Rapidly... (Millions of Gallons) e – estimate Source: Renewable Fuels Association
...And So Is Railroad Ethanol Traffic (U.S. Rail Carloads of Ethanol) e – estimate Source: STB Waybill Sample and AAR estimates
High Correlation Between Ethanol Production and RR Carloads of Ethanol (Index 2000=100) Ethanol Production RR Carloads of Ethanol e – estimate Source: Association of American Railroads, Renewable Fuels Association
Ethanol Is a Small But Growing Portion of Total Rail Traffic Ethanol as a % of Total Rail Carloads Source: STB Waybill Sample
The Midwest Dominates Rail Ethanol Originations Origin States of Rail Shipments of Ethanol IA 20% SD 8% NE 21% MN 6% Others 14% IL 30% Data are for 2005. Source: STB
Railroads Can Handle Rising Ethanol Shipments RRs must be involved from beginning of planning Unit trains are far more efficient Ethanol competes with other traffic for slots • RRs must be adequately compensated • Terminal infrastructure
The Association of American Railroads
% Growth in Trains Per Day From 2005 to 2035 by Primary Rail Corridor
Future Corridor Volumes Compared to Current Corridor Capacity 2035 without improvements
Future Train Volumes Compared to Future Train Capacity 2035 with improvements