Transportation's Role in Reducing U.S. Greenhouse Gas Emissions ...

Transportations Role in Reducing U.S. Greenhouse Gas Emissions: Volume 2
Combined Impact (2030) 15 – 19% 8.7 – 10.8
Uncertainty in this evaluation largely results from the limited number of applications to
date. As such there is little data about how these options will perform under a wide range
of operating conditions.
Cost-Effectiveness
The purchase cost of a new locomotive is typically between $1 and $2 million (CARB,
2008b; Railpower, 2006). Older locomotives can be converted to a genset or hybrid
configuration at approximately 60 percent of the cost of a new conventional locomotive,
and they typically last 20 years before they need to be reconverted. These conversions
costs are approximately $600,000 to $1.2 million and are more expensive then an engine
replacement using a conventional diesel engine (Railpower, 2006). As noted earlier, the
Class I railroads currently are purchasing gensets and hybrids with financial support from
States such as California and Texas.
New locomotive power system technologies are seen to be very cost-effective given the
current and projected diesel fuel costs. For example, yard locomotives consume
approximately 84,000 gallons of fuel per year (U.S. EPA, 2007c, 2009d) which equated to
$308,000 per year at a price of $3.67 per gallon (per AEO forecasts for 2030). Assuming a
40 percent reduction in fuel consumption using gensets or hybrid engines (Railpower, 2006;
NRE, 2008), a simple assessment of the payback period for a converted yard locomotive
would be between five and 10 years, not taking into account discount rates.
The fuel savings associated with diesel locomotive engines with a common rail
configuration are less dramatic than the yard engine options, although costs also are
lower, leading to a similar payback period. Detroit Diesel manufactures common rail
engines with a rating of 1,600 to 3,750 hp at a cost ranging $300,000 to $500,000 (Mangum,
2009). A typical line-haul locomotive uses 150,000 gallons of fuel per year (EPA, 1997) at a
cost of $551,000 (at an assumed $3.67/gallon). A 10 percent reduction in fuel provides a
cost savings of $55,000 per year, which would equate to a payback period between five
and nine years.
Cobenefits
These strategies, particularly genset and hybrid locomotives, can result in significant
reductions in air pollutant emissions, since engines can be run at an optimal speed and
emission controls optimized for this speed. Potential public health benefits are greatest
for applications at rail yards, which are often located in more densely populated urban
areas, whereas most line-haul operation takes place in rural areas. In fact, incentive
programs have been implemented in California and Texas, where genset and hybrid yard
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