It has been clear for several years that America's vast coal reserves hold the promise of independence from foreign sources of energy. In fact, American steam coal seems destined to fuel boilers is much of the world.
This has been a welcome development for the railroad industry -- and for those in the government who have worried about the relatively weak financial position of many railroads.
Because railroads are the single most essential element in the nation's freight transporation system -- and thus play a vital role in the industrial economy -- national policy has beeen aimed toward reversing the downward financial spiral which has sent some railroads into backruptcy and created service problems on others.
The growth of coal, a commodity already carried in great quantities by rail and one well-suited to the mode, has been seen as a way to allow railroads to improve their earnings without the need for massive taxpayer expenditures.
This silver lining, however, has been obscured by a cloud -- in the form of efforts to secure government promotion of coal slurry pipelines.
A coal slurry pipeline is a single-commodity, high-volume mode. Whatever its backers may say, the coal pipeline mode is not designed to meet any national transportation need.
The well-used term "cream-skimming" is apt in this connection. Pipeline advocates often point out that railroads would, even if a number of pipelines are built, stilll carry most coal tonnage. But the pipelines can only carry the "cream" -- the high-volume movement analogous to unit train service -- which railroads need to balance against the "skim milk" represented by less profitable traffic that the common carrier obligations requires them to accept.
The pipeline push for eminent domain legislation is based upon two false premises: that railroads cannot keep pace with national coal transportation demand and that pipelines could deliver coal for electric power generation at rates below those of railroads.
The first premises has been soundly refuted by every independent study, including one done at the behest of Congress by the Office of Technology assessment. It is abundantly clear that railroads are ready, willing, and able to handle steadily growing coal traffic.
The second premise has no basic except the assertions of pipeline promoters. Only two coal slurry pipelines have ever operated in the United States. One was shut down because rail unit train rates were lower. The other, still operating, moves coal at a rate substantially higher than the rail rate for coal to SanAntonio -- which is one of the most controversial rail coal rates in the nation.
Thus, the pipeline push for eminent domain legislation is nothing more or less than a plea for special-interest legislation. Eminent domain rights would give pipeliners the ability to take land regardless of the wishes of the owners. The certification required for the exercise of such rights would make it very difficult for water-poor states to block the export, by pipeline, of billions of gallons of precious water each year.
Having failed to prove their basic premises, pipeline advocates now are saying that legislation to reform regulation of the railroads somehow provides a new reason for government promotion of pipelines.
Such a formulation casts Congress in the role of an old-time "ward boss" dispensing favors.
The intent of Congress in deregulation legislation was to improve the earnings of the railroad industry -- because the public will benefit from the inmprovements in rail service which better earnings can bring.
It would be hardly logical for Congress, having done this, to frustrate its own intent by then passing legislation to promote the development of a redundant transportation mode with the potential to drain away hundreds of millions of dollars of railroad traffic.