"It's really going to have to be a federal vision, with some federal funding."

Converting the freight rail system to electric trains from today’s all-diesel operations might seem like a far-off notion, but BNSF Railway's Matthew K. Rose is starting to explore this new frontier.

If his ideas pan out, BNSF’s still-early planning efforts could help produce historic change for North American freight railroads.

Rose, BNSF’s chairman, president and CEO, told The Journal of Commerce his company is in talks with electrical power line builders about stringing or burying transmission lines in some of BNSF’s inter-city rail corridors.

With those line-easement leases emerging as a possible new revenue source, BNSF officials are also weighing how to electrify the carrier’s mainline track system and asking equipment makers about locomotives that could run both under electric or diesel power.

That puts the nation’s second-largest railroad in the midst of a power-line building boom to upgrade the electrical grid, and angling to be ready for the time when proposed federal caps on carbon emissions might turn diesel use into a big financial disadvantage.

“We have had conversations with two, if not three, outside organizations,” Rose said, “around using railroad right of way for different opportunities of electrification.” He does not see such potential power line projects developing quickly on the railroad, but said BNSF is in “serious” talks with two of them.

He said BNSF could opt to draw electricity from those lines for its own use, in lieu of cash payments. With that, it might also offer power along with freight transportation to a new-era industrial park for various types of factories that burn lots of energy.

BNSF has not asked locomotive makers to prepare any plans, Rose said, but has discussed with them what kind of equipment is already available or could be developed if the railroad begins to integrate electric power with its vast diesel territory.

He said the price tag to electrify all BNSF mainline tracks could be $10 billion, including what the carrier would need in dual-mode locomotives. That’s too steep a price for BNSF to justify right now, but the initial power line projects could be a way to start.

“Without a doubt it helps a lot, but it’s not like either of these deals that we’ve looked at on transmission lines are to blanket our 26,000 miles of railroad,” Rose said.

But a tough new federal policy to cap or cut carbon emissions could soon make electrified rail feasible for freight rail. “I think we’re going to start pricing carbon out at some point in time in the future,” he said. “There’s lots of good news, and lots of not so good news, in that for the railroads.”

Of the power line projects BNSF is discussing, one would draw from an alternative energy production site, another from a nuclear plant. So if BNSF tapped them, that electricity would not come from carbon-emitting coal plants.

Rose thinks the federal government should step in as a matter of public policy, set rail electrification as a national goal to cut carbon levels and U.S. dependence on foreign oil, and help fund it across the entire rail network.

“You hear everybody talking about a carbon-constrained world, and a carbon-priced world,” he said. “Railroads are so efficient from a carbon standpoint in terms of truck, but we still have an opportunity in terms of electrification. But I just think the capital burdens are so enormous when we’re talking about this that it’s really going to have to be a federal vision, with some federal funding.”

Contact John D. Boyd at jboyd@joc.com.

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