The US freight rail system, responsible for transporting a significant portion of the nation's goods, heavily relies on diesel locomotives. These locomotives contribute significantly to greenhouse gas (GHG) emissions and air pollution, causing substantial environmental damage and health consequences. The annual cost of this pollution is estimated at $6.5 billion in health damage costs alone, in addition to the 35 million tonnes of CO2 emitted annually. This study addresses the urgent need for decarbonizing the freight rail sector, focusing on a pathway towards zero-emission battery-electric propulsion. The context is set by the scientific consensus that requires a substantial reduction in GHG emissions to mitigate climate change. The purpose of this research is to evaluate the economic feasibility and environmental benefits of transitioning to battery-electric trains, considering current and projected battery technology, electricity prices, and charging infrastructure costs. The importance of the study lies in its potential to provide a roadmap for large-scale decarbonization of a major transportation sector, contributing to national climate goals while offering economic advantages.

Existing literature explores various zero-emission pathways for freight rail, including electrification through catenary systems, hydrogen fuel cells, and battery-powered locomotives. While catenary electrification is more extensively studied, it faces significant infrastructural challenges and costs. Hydrogen fuel cells, although offering zero-emission potential, currently rely on fossil fuel-based hydrogen production. This study focuses on battery-electric propulsion due to the recent advancements in battery technology, leading to reduced costs and improved energy density. Previous studies often overestimate charging costs by using average electricity tariffs, neglecting the potential of utilizing surplus renewable energy and economies of scale for charging infrastructure.

This study examines the economic feasibility of battery-electric propulsion for Class I railroads in the US, representing 94% of freight rail revenue in 2019. The analysis considers a 241-km range, representing the average daily distance traveled by these trains. A key aspect is the modeling of a single boxcar equipped with a 14-MWh battery and inverter, which is shown to achieve this range while consuming half the energy of diesel trains. The cost analysis includes current and projected battery prices (ranging from $100/kWh to $200/kWh), wholesale electricity prices, and charging infrastructure costs. The authors incorporate different station utilization rates (ranging from 25% to 100%) to assess the impact on charging costs. Total cost of ownership (TCO) and net present value (NPV) analyses are conducted over a 20-year horizon, considering various scenarios including environmental costs, different battery technologies (specifically Lithium Iron Phosphate, or LFP), and electricity market dynamics (such as the ERCOT and CAISO markets). Sensitivity analyses evaluate the influence of key parameters such as battery prices, charging infrastructure usage rates, diesel prices, and battery lifetime on the overall economic viability of the battery-electric transition. Comparisons are also made with alternative zero-emission technologies, such as catenary electrification, highlighting the advantages and limitations of each approach.

The study's key findings indicate that battery-electric trains can achieve cost parity with diesel-electric trains under certain conditions. At near-future battery prices of $100/kWh, parity is achievable if environmental costs are internalized or if rail companies can access wholesale electricity prices and utilize fast-charging infrastructure at a 40% utilization rate. The energy consumption of battery-electric trains is approximately half that of diesel trains, even accounting for additional weight and cooling requirements. Over a 20-year period, switching to battery-electric propulsion is projected to save the US freight rail sector $94 billion, considering reduced air pollution and CO2 emissions. This saving is broken down into: $151 billion in savings when accounting for electricity considerations; $44 billion in savings when considering air pollution abatement, and $94 billion in savings with CO2 emission reductions. The levelized cost of electricity plus charging is estimated to range between $0.51/kWh (60% utilization, ERCOT market) and $0.185/kWh (10% utilization, CAISO market). Sensitivity analyses reveal that charging station utilization rates and diesel fuel prices significantly impact the NPV of battery-electric locomotives. Comparisons with alternative zero-emission technologies suggest that battery-electric retrofitting offers a more cost-effective and quicker solution in the short term, compared to the substantial investment needed for widespread catenary electrification, despite the lower infrastructure cost estimates seen in other countries. The potential for repurposing used locomotive batteries for grid-level storage is also highlighted, providing additional benefits in grid resilience.

The findings demonstrate the economic and environmental potential of transitioning to battery-electric freight trains. The cost savings achieved by reducing pollution damages and leveraging low-cost renewable energy make battery-electric trains a compelling alternative to diesel. The analysis highlights the crucial role of charging infrastructure utilization rates and access to wholesale electricity pricing in achieving cost parity. Further research into optimizing charging infrastructure deployment and electricity market integration is needed. The findings' relevance to the field lies in its quantitative assessment of the economic viability of battery-electric rail, providing crucial data for policymakers and industry stakeholders considering decarbonization strategies for the freight rail sector. The modularity and mobility of the battery systems, potentially repurposed for grid support, open up new opportunities beyond just transportation electrification.

This study strongly supports the transition to battery-electric freight trains in the US. Even with near-future battery costs, cost parity with diesel is achievable, offering significant environmental and economic benefits. The potential for grid-level storage using retired locomotive batteries adds further value. Future research should focus on optimizing charging infrastructure deployment, integrating battery-electric trains into the electricity market, and exploring potential policy incentives to accelerate the transition.

The analysis relies on projected battery prices and electricity costs, which may be subject to uncertainties. The model also assumes a certain level of charging infrastructure utilization and access to wholesale electricity pricing. Actual implementation may vary depending on regional specificities and regulatory frameworks. The study primarily focuses on Class I railroads and may not fully capture the characteristics of smaller rail operators.