The fact of the matter is there are cheaper, cleaner alternatives to coal that are already out there and are causing coal's decline: cheap natural gas, wind power, solar energy, hydroelectric power and even nuclear power are all eating away at coal's market share. BNSF and Union Pacific should be able to hold out for a while longer, since Powder River coal is lower in sulfur and cheaper than Appalachian coal, but Norfolk Southern and CSX should both start preparing for a post-coal world as soon as possible. In the long run, that means building up carload and intermodal traffic to offset the loss of coal, as well as investing in better customer service and their marketing departments. It will be a painful and difficult transition for both, but its an absolute necessity if Norfolk Southern and CSX don't want to end up like the Anthracite Roads.
Fair use:
Today, about 66 percent of the electricity in the United States is produced by coal and natural gas, and just 7 percent is produced by renewable sources such as wind and solar. But market forces and government regulations are rapidly changing that picture.I hate to say it, but good riddance to coal. It has done immeasurable damage to our planet.
A glut of inexpensive natural gas has cut into coal’s dominance of America’s power market. And President Obama’s climate change regulations, known as the Clean Power Plan, take direct aim at coal, the No. 1 cause of planet-warming greenhouse gases.
As for the future, I agree with GulfRail. Railroads are going to have to be more aggressive than ever on all fronts, from short haul intermodal to loose carload freight. They also should try to harness the new reality, maybe running water trains to drought stricken areas, or trying to make themselves a crucial part of the supply chain in renewables.
One great example is what Tesla is doing. They are building a massive (MASSIVE!) factory near Reno, and plan to ship all their batteries by rail to their auto plants. That is the kind of stuff railroads need to go after, and do it well too, as with the advent of JIT logistics, day wide delivery windows are just unacceptable. If they spend too much time going after/gearing their networks towards conventional traffic (like fossil fuels) they will perish. It's do or die for them.