W.Va.'s River Ports Work to Avoid Being Locked Down

New capital investment strategy may rescue Lower Monongahela navigation facilities

The State Journal
20 May 2010
By Pam Kasey

CONSOL Energy's river division transports coal to a utility customer. Photo Credit: CONSOL Energy

MORGANTOWN -- Century-old lock and dam facilities on the lower Monongahela River have gotten a Band-Aid treatment for decades, putting the economy in north-central West Virginia and southwestern Pennsylvania at risk.

Now, though, a new agreement may break the log jam and get funds flowing.

"This is the most hopeful scenario we have," said Port of Pittsburgh Commission Executive Director James McCarville. "It certainly is better than where we are right now, where we don't have any hope of finishing the lower Monongahela project in a reasonable timetable."

The Inland Marine Transportation System (IMTS) Capital Investment Strategy was negotiated over the past year between a river users' group and the U.S. Army Corps of Engineers and approved unanimously by the users' group in April.

The strategy comes none too soon for the Monongahela River, where river shippers and managers fear a system failure could severely disrupt the region's commerce.

The Problem

The Monongahela River has been used for commercial shipping since long before the USACE acquired and began upgrading a patchwork of private locks and dams in 1897.

In 1992, with century-old infrastructure in imminent danger of collapse, Congress authorized a 10-year, $750 million project on Locks and Dams 2, 3 and 4 above Pittsburgh.

The Lower Monongahela Improvement Project consisted of a new dam at L&D 2, removal of the critically failing L&D 3 and two new locks at L&D 4.

Eighteen years later, the project is only half finished, and the price tag has more than doubled to $1.7 billion.

Here's why: The Inland Waterways Trust Fund, or IWTF, a pot of money that Congress created in 1986 through a 20 cent-per-gallon tax on diesel fuel on the navigable waterways, must, by law, provide a 50-50 cost share with the Corps for construction and major rehabilitation on the waterways.

But the IWTF is nearly bankrupt.

So far, a new dam went into operation at L&D 2 in 2004 and some work has been completed at L&D 4.

But the dam at L&D 3 is limping along.

"We already had a very significant dam failure there, and in 2007 and 2008 we did what I call a 'Band-Aid' repair that's supposed to last five to 10 years," said USACE Lower Monongahela Improvement Project Manager Stephen Fritz.

"At L&D 4 ... we only have one lock chamber, and that's almost 80 years old," Fritz continued. "If that chamber fails, commodities can't get through. Failure of either of those facilities essentially stops navigation."

It's not hard to measure the importance.

In 2008, 28 million tons of goods passed through Mon River locks, according to Corps statistics. Compare that with other navigable Ohio River tributaries: 20 million tons on the Kanawha River and just 2.5 million on the Allegheny River.

Nearly 90 percent of Mon River shipping was coal.

What would happen in the event of a lock and dam failure?

Envisioning Failure

"The biggest thing we use the river for is coal," said Dale Evans, regional director of Allegheny Energy's Fort Martin power station.

Two of Allegheny's largest power stations, the 1,100-megawatt Fort Martin and 1,700-MW Hatfield's Ferry, sit along the Monongahela River near the West Virginia-Pennsylvania border.

"In addition, both plants now use limestone, which comes out of Kentucky up the Ohio River and up the Mon," Evans said.

The limestone is for sulfur dioxide scrubbers that went online in 2009 at the two plants.

For Fort Martin, Allegheny brings in 2.6 million to 3 million tons of coal, or up to 3,000 barges, each year.

"If I had to bring that with trucks, that would equate to roughly 300 trucks a day," Evans said.

Limestone comes to Fort Martin on about 150 even larger barges a year -- another 25 trucks or so a day.

Although Evans did not have coal and limestone figures for Hatfield's Ferry, he noted the plant's generating capacity is about 1.5 times that of Fort Martin.

He described a logistical, regulatory, cost and safety nightmare for Fort Martin alone.

"The whole process just becomes bogged down greatly," he said. "I can unload a 1,000-ton coal barge in an hour and 15 minutes. I'm not going to run 40 trucks on a coal pile in an hour and 15 minutes. It becomes questionable as to whether you could even feed a station this size with trucks."

There's a good chance that, in the event of a long-term lock shutdown, electricity from plants on the Mon River -- these two plants plus Allegheny's 370-MW Mitchell plant and Reliant Energy's 510-MW Elrama plant -- would be priced out of the market, he said.

Other major facilities on the river use coal as well, especially U.S. Steel's Mon Valley Works.

But Michael Somales, River Operations and Logistics general manager for Canonsburg, Pa.-based CONSOL Energy, takes a larger view of a lock and dam failure.

CONSOL's river division is one of the oldest shippers on the Mon, according to spokesman Joe Cerenzia. With 29 vessels and more than 700 barges, it's also one of the largest.

The company ships more than 20 million tons of coal on the river each year, according to Somales, some of it from CONSOL, some comes from other producers under contract.

The company also ships a broad range of commodities.

Somales acknowledged the obvious importance of river navigation to CONSOL and to both shippers and users of coal.

But beyond that, "The Morgantown area, for example, ships a large number of aggregates to the Pittsburgh construction market," he said. "That would take them out of the Pittsburgh market."

In addition, petroleum products are moved into the area by barge and then distributed by truck from river terminals to gas stations.

"If you had to put trucks on the roads to solve these problems, it would be a congestion nightmare," he said, suggesting shortages of transportation fuels within days or weeks.

"I don't think you could replace the river shipping."

The Agreement

The IMTS Capital Investment Strategy would make major changes to the IWTF.

It would raise the diesel tax on inland waterways from 20 cents/gallon to anywhere from 26 cents to 29 cents.

It would retain the 50-50 cost share for construction and major rehabilitation of locks.

However, it would shift the cost of improvements on dams to the federal government, because dams have multiple beneficiaries, and it would put the cost of projects under $100 million on the government.

Finally, it would cap project costs so overruns would not require additional IWTF matches.

If approved by Congress, the Lower Monongahela Improvement Project would be second in line nationwide for funding, according to McCarville.

That would allow the project to be complete by 2023 -- and there are no ideas for getting it done sooner.

"Our hope is all in that basket," Fritz said.