The Cost Savings of Steam Today.

[NW Mailing List]

Alex,

You are correct I didn't include much information on coal price  
volatility.  This paper was more of an overview.  Sometime maybe I  
can write the uncondensed book version.  I left a great deal out on  
the account of length.

On Jan 12, 2008, at 9:58 AM, NW Mailing List wrote:


> John,

>

> I glanced through your paper to see how you had addressed the  

> volatility in coal pricing and assumptions about type of coal used  

> to achieve a desired BTU.  Not very much information was reaadily  

> apparent other than a reference to EIA forecasts which I looked at  

> and saw oil and coal price trends were expected to stay the same.   

> That leaves me with a number of questions since the paper is about  

> economic analysis of alternative fuels.  Besides which various  

> other respondents are addressing the operational and engineering  

> factors.


I was using the 4 high BTU coals tracked by the EIA.  Northern and  
Central Appalachian, Illinois and Colorado.  Each Class I RR had a  
different coal blend based on geographic region.  For instance the  
comparison for BNSF and UP was using 75% Colorado Coal and 25%  
Illinois Coal.


>

> 1) Are you using mine face pricing or delivered pricing. I  

> calculated you were using about $41.50 per ton of coal which I  

> assume is delivered price?


I was using spot market prices.  Contract prices would however be  
lower than these.


> 2) Given different coal types produce different BTUs do you  

> consider the price difference in type of coal you use? (For the  

> week ending Jan 4 2008 the variability in pricing was $58/ton for  

> 12,500 BTU coal from Applachia to $11.60/ton for 8,800 BTU coal  

> from Powder River.  That is a 5 to 1 pricing difference for type of  

> coal.)


Yes all the comparisons where adjusted to take into account the  
different BTU's of the coal.  IE more or less of a certain coal type  
would be burned per hour to produce the ton-miles per hour or engine  
hours( in the case of a comparison involving local switching or yard  
switching).


> 3) What is the variability in transportation cost for railroads  

> located near and far from the mine face?

> 4) How would a 6.2% increase in coal production requirement affect  

> the coal price and therefore affect your conclusion? (THis comes  

> back to the type of BTU you want.)

> 5) How would successful coal gasification affect the price of coal  

> (increased consumption) and oil (reduced consumption)?


I don't have this data.


>

>

> Alex Schust



John R.
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