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RAILROAD STRIKE THREATENED | WISCONSIN IMPACT

Wisconsin utilities brace for potential fallout of rail strike

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With a deadline looming, industry groups are asking lawmakers to head off a potential rail shutdown that could affect virtually every corner of the economy, from retail goods to fuel and even drinking water.

Amtrak, which runs trains over private rail lines, has canceled all long-distance passenger service starting Thursday, including the Empire Builder, which runs between Chicago and the Pacific coast.

Unions and major rail carriers, including lines that serve Wisconsin, have been working for years to resolve ongoing disputes over sick leave and penalties for missing work. A federal “cooling off” period ends Friday, opening the possibility of a strike or lockout.

Canadian Pacific train

A Canadian Pacific train pulls out of the switch yard in La Crosse. Wisconsin utilities depend on railroads to deliver coal to the six plants that generate the bulk of the state’s electricity, as well as chemicals used to disinfect water.

The Associated Press reported that members of the International Association of Machinists and Aerospace Workers District 19 voted Wednesday to reject a tentative agreement negotiated by union leadership and the railroads. But the IAM agreed to delay any strike by its members until Sept. 29 to allow more time for negotiations and to allow other unions to vote.

A rail shutdown could deal a major blow to the economy, throttling up to a third of the nation’s freight — including shipping containers, vehicles, fertilizers and grains — and costing $2 billion a day, according to the rail industry.

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Wisconsin utilities also depend on railroads to deliver coal to the six plants that generate the bulk of the state’s electricity, as well as chemicals used to disinfect water.

The Wisconsin Department of Natural Resources warned water and sewer utilities Wednesday that a rail shutdown could disrupt deliveries of chlorine and other bulk chemicals, such as fluoride and phosphates, and urged utilities to come up with contingency plans.

McCrea Baker, the DNR’s water system security and emergency response coordinator, said while most utilities do not receive rail shipments directly, they could be affected if bulk shipments to their suppliers are disrupted.

Baker said railroads have already curtailed shipments of concentrated chemicals to avoid stranding hazardous materials in the event of a strike.

The American Water Works Association has warned members to calculate the number of days until they run out of disinfectant and need to issue boil orders.

Marcus Pearson, a spokesperson for the Madison Water Utility, said utility managers are learning more “as each hour passes” but are “confident that this will not impact the utility’s operations nor the quality of our drinking water.”

Pearson did not say how long the utility’s chlorine supply would last.

Madison Metropolitan Sewerage District spokesperson Amanda Wegner said the utility has “adequate supplies of chemicals at this time,” but added the strike is “an unpredictable situation” and managers are relying on suppliers for updates on the potential impact.

Columbia Energy Center

Wisconsin utilities rely almost exclusively on railroads to deliver coal, which is used to generate the bulk of the state's electricity. Water utilities could also be affected by a potential rail strike.

Fuel at risk

Wisconsin utilities rely almost exclusively on railroads to deliver coal for electricity generation, though they typically keep stockpiles to last a month or more.

The state’s power plants received 5.7 million tons of coal in the first half of 2022, a 19% decline from the previous year, and had just under 2 million tons of coal on hand as of June, according to the U.S. Energy Information Administration.

A spokesperson for WEC Energy Group, which operates three of the state’s largest coal-fired power plants, said the utility has enough coal on hand “for the foreseeable future” though an extended rail stoppage could impact plant operations.

“We have long invested in reliability and fuel diversity — including renewable energy and natural gas generation,” said Brendan Conway. “We are confident we will be able to continue to provide customers the energy they depend on.”

Dairyland Power Cooperative spokesperson Katie Thomson said the utility’s coal supply at the 390-megawatt John P. Madgett station in Alma is “slightly below” the 30- to 50-day normal.

Thomson said rail deliveries “have been generally performing well,” but the cooperative, which provides power to cooperative and municipal utilities serving about 250,000 customers, is concerned about the potential for a strike, which “could impact our ability to meet winter demand for power.”

In the event of a strike, Thomson said Dairyland would consider burning more natural gas to conserve coal.

Wisconsin Emergency Management spokesperson Andrew Beckett said the agency is monitoring the situation and communicating with utility companies.

Food and gas

A rail strike could also drive up motor fuel prices and even affect food production, according to industry trade groups who have urged lawmakers to step in to avert a strike or lockout.

The American Fuel & Petrochemical Manufacturers told congressional leaders a strike could force production cuts at refineries and petrochemical factories, depleting gasoline and diesel supplies.

Railroads told oil and gas industry representatives last week that they were curtailing shipments of hazardous materials and other chemicals to prevent carloads from being stranded, according to a letter from the American Petroleum Institute, which said that alone “could have profound impacts” on the industry’s ability to deliver energy supplies.

The fertilizer industry’s trade group joined the call for Congress to intervene, saying a strike could impact delivery of fertilizer for fall applications, reducing domestic crop production.

“For every day this uncertainty continues, we essentially lose five shipping days because of the ramp down and ramp up,” said Corey Rosenbusch, president of The Fertilizer Institute.

There has not been a national rail strike since 1991, when Congress voted to end it less than 24 hours after workers walked off, according to Bloomberg.


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