COAL AND PHILOSOPHY

The answer is rarely simple, and it can go either way. It depends on many factors - the distance involved, the type of coal, the geometrical configuration of the consumer net, the technological advances in electrical transmission (and their virtual absence in railroad transportation), etc. Nor is the energetic efficiency the only criterion. There are environmental considerations (usually in favor of electrical transmission), and, above all, there are economic considerations: Investment costs are lower for transporting coal if a suitable railroad is already in existence, but operating costs are higher.

If transportation of the coal is more advantageous, there remain other decisions.

Until recently, the only reasonable coal transport was by rail. Slurry lines have been technically feasible for some time, but the railroads, with coal the biggest freight item (25% of tonnage, 11% of revenues), would lower their rates to undercut the potential - and in some cases the actual - competition. (You listening, Ralph? That is the way to protect the consumer!) They may not be able to do this any more.

A slurry line pumps a mixture of powdered coal and water through a pipeline from mine to power plant; at the destination, the coal is centrifugally separated from the water, which is used up in the power plant's cooling system by evaporation. (The coal, of course, is burnt as the fuel.)

The efficiencies of the two coal transportation methods are close; the slurry line actually uses a little more energy when the preparation of the coal at the mine is considered. The two are also close in cost:

1-76/2

Transportation costs are lower by slurry line, investment costs are higher than upgrading an existing railroad bed. Environmentally, the slurry line is far sounder, unless there are compelling reasons against water depletion in the mine area.

Enter a new and overriding economic consideration: inflation. Railroad costs will increase much faster than slurry line transportation. Once a slurry line is in place, there are no brotherhoods to demand coal stokers on diesel engines, or 30-mile workshifts, or $100,000 in severance pay if fired. And as yet, there are no Barry Commoners to advocate nationalization of slurry lines, nor acts of Congress requiring them to work at a loss "in the public interest," nor Amtrak bureaucracies building giant deficits for deteriorating service.

Based on such considerations, Middle South Utilities calculate that they can save $14 billion over the 30 year life of their planned generating complex in Arkansas if a slurry line is built to bring in coal from Wyoming.

Is the calculation right or wrong? Ordinarily, the ultimate decision would be made by the king of the free enterprise system - the consumer.

But the consumer is no longer king; he is being ripped off by consumer protection agencies, consumer advocates, and consumer-oriented politicians. And so the contest between slurry and rail does not involve the consumer's pocket book, but is fought in Washington's corridors of power.

The pipelines have a lobby headed by a former House of Representatives Clerk, who now collects for many a past favor. But the railroad lobby is not powerless either, and they charge foul play by Bechtel Corp., which owns a 40% interest in a firm sponsoring a slurry line... The environmentalists (who support the railroads in a similar strife with coal-carrying canal barges) are still choosing sides.

It is our guess that in a free enterprise system, the slurry lines would ultimately win. In reality, the winner is likely to be the one who has more political clout.