And a politically hard, but eminently straightforward alternative.
California’s regulators want to ban older diesel locomotives from operating in California after 2029, requiring only battery locomotives or some other form of net-zero emission locomotion process to be the motive force over freight trains (and passenger trains after 2030).
The Wall Street Journal‘s editors think that would ban diesel locomotives nation-wide, and in one sense they’re right.
Since locomotives can’t be swapped at the state border, the rules in practice would affect trains far beyond the left coast.
That offering is a false choice, though. There’s nothing in California’s proposed regulations that would stop rail freight shippers from simply ceasing to ship goods into California. California’s businesses could use their State government-mandated battery locomotives to go get the goods warehoused just outside the State’s border.
The transition to this new shipping paradigm would be expensive, but there would be clear winners, both during the transition and after. During the transition, there would be a proliferation of construction jobs as the warehouse would be built along with a net increase of jobs for warehouse operators. There would be more jobs building and then operating new transshipment facilities for unloading the trains and short-haul transportation of the goods to the warehouses.
Longer-term, warehouse operators would make money, short haul truckers would see a large increase in business and business opportunities, and railroads would save money by not having to gussy up all of their rail equipment to meet California’s requirements. Even California’s range-limited battery locomotives would gain by not having their range limits play such a major role in their operation.
The biggest winner of all would be the railroads, which would have successfully rescued themselves from under the boots of the California government.
A flaw in this approach is the traffic emanating from the port of Long Beach – massive cargo flows from the Pacific to the interior which are transported by rail from the port area east. Long Beach is already losing traffic due to labor disputes and the silly drayage rules mandating electrics vs diesel (reducing trip count per rig from from multiple trips/day to one, sometimes two, if a driver is lucky). Alternative ports on the west coast can’t handle the load; former rerouting to the east coast via the Panama Canal is now hampered by low water levels and the resulting traffic limitations there. And then there is the Red Sea problem … There are no good answers, only bad and worse ones.
The problem for California in getting goods from the ports to the interior is a wash: the State’s battery locomotive requirement hits this either way.
This is just another opportunity–and creates additional potential winners–as other West Coast ports ramp up to handle the increased traffic.
California’s battery rule also makes shipping from Asia direct to our East Coast cost effective, especially as those ports ramp up to handle the load. The distances are much greater, but steady state speeds makes the cost increment less than linear.
Biden’s timidity vis-a-vis the Houthis and his reluctance to work with Panama re the canal are separate from California’s foolishness, for all that Biden’s failures potentiate California’s.
Eric Hines