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Cash Market Moves

7/17/2018 6:40:00 AM
By Mary Kennedy
DTN Cash Grains Analyst

In late 2015, Congress extended the deadline for positive train control implementation by at least three years to Dec. 31, 2018, with a possible extension to Dec. 31, 2020, if a railroad completed certain statutory requirements necessary to obtain an extension, according to the Federal Railroad Administration (FRA). The legislation, the Positive Train Control Enforcement and Implementation Act of 2015, required all railroads to submit a revised PTC Implementation Plan (PTCIP) by Jan. 27, 2016, outlining when and how the railroad would have a system fully installed and activated.

The U.S. Department of Transportation (DOT) released a letter on Jan. 2, 2018, from Secretary of Transportation Elaine L. Chao to all the nation's Class I railroads, intercity passenger railroads and state and local transit authorities, stressing the urgency and importance of safely implementing positive train control (PTC) systems in the upcoming year to meet the Dec. 31, 2018, deadline, as mandated by Congress.

"Advancing the implementation of PTC is among the most important rail safety initiatives on the Department's agenda," Secretary Chao said in the letter. "FRA leadership has been directed to work with your organization's leadership to help create an increased level of urgency to underscore the imperative of meeting existing expectations for rolling out this critical rail-safety technology."

U.S. Sen. John Thune, R-S.D., chairman of the Senate Committee on Commerce, Science and Transportation, convened a hearing titled, "Implementation of Positive Train Control" on March 1, 2018. "Railroad passengers expect railroads to follow safety laws and implement the necessary technology to do so, including PTC," said Thune. "After troubling reports that some commuter railroads are falling behind on implementation, this hearing will examine what needs to get done and what railroads need to do to meet their obligations."

Here is a link to the testimonies at the hearing:

https://www.commerce.senate.gov/…

BNSF Railway Company (BNSF) announced in December 2017 that it had fully installed PTC and was operating under PTC on all mandated subdivisions well ahead of the year-end deadline. However, in mid-June, they submitted a request to the DOT for a two-year extension of the PTC deadline, due to the FRA current interpretation of the law that full implementation status cannot be achieved until all non-BNSF trains and/or equipment operating on its PTC-equipped lines are also PTC compliant, according to a BNSF press release.

"BNSF has succeeded in the adoption of this key safety technology. Even with this request for a deadline extension, BNSF's PTC network is installed and we are currently running, and will continue to run, more than a thousand trains daily with PTC as we continue to refine the system and resolve technological challenges," said Chris Matthews, BNSF assistant vice president, Network Control Systems.

However, to be considered fully implemented requires that all other railroads operating across any of BNSF's PTC-equipped lines must be capable of operating with BNSF's PTC system, noted the press release. "This interoperability of PTC systems between Class I, commuter and short-line rail carriers remains a challenge," said BNSF. "While the BNSF has successfully demonstrated interoperability with several railroads that operate on its network, including commuter railroads and Amtrak, not all railroads that operate on BNSF will have completed their PTC installation by the end of 2018."

Union Pacific (UP) has stated on their website that, at the end of 2018, PTC will be 100% installed on UP's required rail lines, and implemented on 75% of the required lines.

"When we filed our revised implementation plan in 2016, the goal was full PTC implementation on all required lines by the end of 2018. However, as we implemented this complex suite of technologies across our network, the largest one in the U.S., unanticipated operational issues developed," UP stated on their website.

"As permitted by Federal statute, UP intends to file with the FRA an alternative schedule for implementing PTC on the remaining segments as soon as practicable, but no later than the end of 2020. We will meet all criteria necessary for an alternative schedule, including full network installation and implementation on the majority of required lines, by the end of 2018.

"UP remains committed to PTC. The alternative schedule provides flexibility to problem solve issues that arise, so that this critical safety system is implemented correctly. PTC will be installed and implemented for all passenger use on UP's required lines by the end of 2018."

The Association of American Railroads (AAR) stated on their website that Class I railroads that meet the 2018 installation deadline can obtain an additional 24 months to test and ensure the system is fully interoperable.

"It is not enough to get PTC to operate across a single railroad's footprint; it must be interoperable. Interoperability means that the system works with any PTC-equipped locomotive running on any of the railroad tracks through the United States where PTC is required," noted AAR. "While some railroads will be fully implemented by the end of 2018, others will continue to test and will be fully interoperable no later than the 2020 deadline."

Here is a link to the background on Positive Train Control Enforcement and Implementation Act of 2015:

https://www.transportation.gov/…

Here is a link to an article posted by Association of American Railroads on Complexities and Challenges of PTC

https://www.aar.org/…

Here is a link to all U.S railroads quarterly reports on PTC implementation progress:

https://www.fra.dot.gov/…

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow her on Twitter @MaryCKenn

(BE/BAS/AG)