New Paper Shows Effect Of Carbon Tax On Coal Transportation
A new paper from a UC Berkeley researcher shows that coal transportation companies will also lose money from carbon caps.
From the paper:
In those markets, Preonas demonstrates that new profit pressures — such as would come from a price on carbon that raises the cost of coal generation relative to other sources — are partially absorbed by the railroads in order to keep from losing coal-shipping business. This cushioning effect doesn’t impact all coal generation, but it is clearly present at plants served predominantly by a single railroad, which constitute about 44% of all U.S. coal-fired power plants. At plants served by multiple railroads, or those located on a river or lake that allows them to receive shipments by water, margins of the transportation companies are already thin so they have little room to lower their charges to keep the customer’s coal plant running.
No discussions yet. Start a discussion below.