Discussion related to commuter rail and rapid transit operations in the Chicago area including the South Shore Line, Metra Rail, and Chicago Transit Authority.

Moderators: metraRI, JamesT4

  by doepack
 
An increase in fuel efficiency (and the savings realized therein) was among the advantages Metra was seeking when they purchased the MP36's. Due in no small part to their larger fuel tanks, the increased capacity enables them to make additional trips on the busy BNSF, and this multiple trip advantage is also evident on longer routes such as the Milw-N line to Fox Lake, about a 50 mile trip one way from CUS.

According to Metra's 2006 budget however, the increase in diesel fuel prices more than doubled between 2004 and 2005, going from .80/gal to 1.74/gal, which translated into an annual cost increase from 18.8 million dollars in 2004 to 42.2 million last year. It's likely that the increase would not have been nearly as high had Metra been able to retain the same fixed price purchasing arrangements as they had in 2004 and years prior, but for reasons unknown (or at least not made public) Metra was unable to continue with the arrangement. With the new start services in place, Metra has forecast an expenditure of close to 50 million dollars this year for fuel, or 1.90/gal. They're on record as saying that they don't expect that figure to increase over the next two years. We'll see about that I guess, but one thing is clear: The staggering jump in fuel costs has pretty much negated any fuel savings that had been realized by the newer locomotives...

  by orangeline
 
I guess the way to look at it is that even though higher fuel costs may have cancelled out existing savings due to the new locomotives, the presence of the MP36s will help Metra keep current and future fuel expenses lower than they would have been without these engines. In that sense Metra still ends up winning.

  by doepack
 
That's true, but it's a shame that the fuel efficiency can't be maximized system-wide, since the MP36's don't run on the UP lines. If they could, Metra would stand a better chance of keeping fuel costs stable, perhaps over a longer period of time. Indeed, those large fuel tanks would certainly come in handy on those 63 mile runs to Harvard...

  by byte
 
Don't forget to factor in the total energy savings that the new electric cars are going to incur, with the regenerative braking. It's not diesel fuel, but more than likely we'll see more new highliners before we see more new locomotives. If they're saving money in the future, it's going to be by the kw/h, not by the mpg.
  by metrarider
 
doepack wrote: It's likely that the increase would not have been nearly as high had Metra been able to retain the same fixed price purchasing arrangements as they had in 2004 and years prior, but for reasons unknown (or at least not made public) Metra was unable to continue with the arrangement. With the new start services in place, Metra has forecast an expenditure of close to 50 million dollars this year for fuel, or 1.90/gal. They're on record as saying that they don't expect that figure to increase over the next two years. We'll see about that I guess, but one thing is clear: The staggering jump in fuel costs has pretty much negated any fuel savings that had been realized by the newer locomotives...
Getting 'fixed price' fuel contracts involves on or both parties hedging via Futures contracts on the price of fuel. For example, if I want to fix my price of fuel from now out 18 months, I can go an buy a set of futures contracts to achive that on various energy markets.

However, each futures contract has a particular date attached to it, so I can contract now for fuel to be delelivered in (for example) December and have that price fixed.

Of course, 2 years ago, the futures contracts were trading much lower, and so organisations that fixed prices using those contracts won out as spot prices rose. Of course sooner or later the futures contracts they hold reach maturity and buying new futures contracts now does not net the same discount (and may even represent a premium over todays prices) as the current price of futures reflects the spot (for delivery today) market along with market expectations for the direction of fuel prices.

So, both Metra, and other large consumers of fuel (such as Airlines and other Railroads) have been unable to get the same price lock once their older futures contracts reached maturity as the spot and futures markets have now risen significantly.
  by doepack
 
That was my guess as well, although I preferred not to additionally speculate on that in my original post since I didn't know exactly when the maturity date occurred on Metra's (or RTA on Metra's behalf perhaps?) last futures contract, But in any case, the insight is appreciated, thanks...