What Railroads Haul: Coal

Key Takeaways
Although rail coal shipments have declined in recent
years, coal is still an essential part of the nation’s industrial • Just five states account for more
economy and a key rail market. Well over 90% of U.S. coal than 70% of U.S. coal production,
consumption is for electricity generation, while some coal but coal is consumed all over the
country — a feat made possible by
is used to produce coke and for other industrial purposes.
freight railroads.
U.S. coal is also exported to countries all over the world
for steelmaking and power generation • Rail coal volumes have fallen in
recent years, but coal is still a crucial
Energy markets have been changing. commodity for U.S. freight railroads
and the larger economy. In 2021:
According to the Energy Information Administration (EIA),
U.S. coal production in 2021 was 578 million tons, up 8% o U.S. railroads moved 3.3 million
from 2020 but down 51% from the all-time high of 1.17 carloads of coal, with each rail car
billion tons in 2008. carrying enough coal to power 20
average homes for a year.
U.S. coal consumption in 2021 was 546 million tons, up
from 477 million tons in 2020 and 52% lower than the 2007 o Coal accounted for 27% of
peak of 1.13 billion tons. Because electricity generation originated tonnage for U.S
accounts for so much U.S. coal consumption, the railroads, more than any other
commodity.
electricity market is key to coal’s fortunes. For decades,
total U.S. electricity generation rose steadily, more in less o Coal accounted for 11% of
in tandem with economic growth. o revenue for railroads, behind only
intermodal and chemicals.
Because electricity generation
accounts for so much U.S. coal
consumption, the electricity market is
key to coal’s fortunes. For decades, Originated Units by Class I RRs in 2021
total U.S. electricity generation rose Nonmet. minerals
Food prod. Lumber &
steadily, more in less in tandem with 1,298,000
Metallic ores 1,542,000 wood
economic growth. Over the past 15 792,000 296,000
Coal
years, though, total U.S. electricity 3,341,000 Pulp & paper
generation has been roughly flat while Farm 617,000
products
coal’s share has plunged. 1,661,000 Petr. & coal pr.
Chemicals
727,000
2,207,000
Concerns about the environmental
Other Stone, clay,
impact of coal have played a major glass pr.
535,000
role in its decline, but market forces 457,000
have been even more important. Rapid Prim. metal pr.
increases in natural gas production Total = Intermodal* 501,000
brought about by technological 26.2 million 11,715,000 Transp. equip.
advances in natural gas extraction, 1,206,000
especially hydraulic fracturing, or *Some intermodal is included Waste & scrap
in other commodities. 604,000
fracking, has meant that natural gas is Source: AAR (FCS)

much more plentiful and cheaper for

electricity producers than it used to be.

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Through technological advances, U.S. Electricity Generation From Coal
responsive service, competitive rates vs. U.S. Rail Coal Tonnage*
and massive private investments, railroads 1,000 2,500
continue to provide safe, reliable high- 900 Electricity from coal 2,250
(000 megawatthours,
value transportation service to their 800
right scale)
2,000

coal customers. 700 1,750

600 1,500

U.S. coal production happens in a few states, but 500 1,250

large amounts of coal are consumed all over the 400 1,000
Rail coal tonnage*
country. 300 (millions, left scale) 750
200 500
According to EIA data, 69% of U.S. coal shipments 100 250
in 2021 were delivered to their final destinations by 0 0
'05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21
rail, followed by water (12%, mainly barges on
*Originated tonnage, Class I railroads Source: EIA, AAR
inland waterways); conveyor belts (10%, mainly at
minemouth plants); and truck (9%).
Originated Carloads of Coal by U.S. Class I Railroads
As coal’s share of U.S. electricity generation has (millions)
fallen, so have rail coal volumes. In 2008, U.S. 8
Class I railroads originated a record 7.71 million 7
carloads of coal. In 2020, coal carloads were down
6
to 3.03 million, down 61% from 2008, before
rebounding to 3.34 million in 2021. Rail coal 5
tonnage peaked at 879 million tons in 2008, was 4
down 60% to 354 million tons in 2020, then rose to
3
391 million tons in 2021. Coal accounted for 27% of
total originated tonnage for U.S. Class I railroads in 2
2021, far more than any other commodity. 1

0
Coal accounted for $7.9 billion in gross revenue for '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21
Class I railroads in 2021, equal to 11% of total Source: AAR Freight Commodity Statistics
revenue. Only intermodal and chemicals
accounted for more revenue among rail traffic
categories than coal in 2021. The vast majority of coal transported by rail moves in highly productive unit
trains, which often operate around the clock, use dedicated equipment and generally follow direct
shipping routes.

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