Alabama’s Inland Waterways:an Economic Engine for the State

Study conducted for the Coalition of Alabama Waterway Associations

by

Troy University Center for International Business

and Economic Development

Waterway Roles in the State’s Economy

• Navigation• Recreation• Power Generation• Water Supply• Flood Control*

* Not in Troy study, but a major economic factor

Contribution to Alabama’s EconomySource: Troy CIBED “Accounting for Economic Value of Alabama’s Inland Waterways,” March 2012

Direct Jobs Direct Output

Navigation/Shippers

27,698 $6.13 billion

Power Generation

7,564 $1.85 billion

Recreation (Federal recreation sites only)

3,596 $474 million

Water Supply 14,620 $7.45 billion

Total (Does not include Port of

Mobile)

53,478 $15.9 billion(annually)

Total Economic Impact of the

Five Navigable River Systems of Alabama

Additional 116,000 jobs indirectly dependent About 11% of Alabama’s total employmentAffects 40 of Alabama’s 67 counties

$910 million in federal tax revenues

$485 million in State tax revenueSource: Troy CIBED Study, March 2012

5

Alabama’s Inland Waterways

1400 miles of federally funded navigable waterways – second-most in US

Integral part of nation’s transportation system providing multiple benefits to the State and region

Links to major river ports in 21 states serving the Tennessee River Valley, Ohio, Missouri, Upper Mississippi, and Great Lakes

Access to major Gulf ports and river systems via the Intracoastal Waterway

Alternative waterway for traffic on Mississippi River

Access to world trade through the Port of Mobile

Maintained primarily by US Army Corps of Engineers and US Coast Guard

ARKANSAS

OKLAHOMA

KANSAS

NEBRASKA

WISCONSIN

Transportation Benefits*Using water transportation for 80 million tons annually

meansReduced road and rail congestion

3 million trucks are not traveling Alabama and neighboring state highways

690,000 rail cars are not blocking intersectionsReduced road maintenanceLess energy used (ton-miles/gallon of fuel)

Barge – 616 Rail – 478 Truck – 150

Less environmental impact Up to 70% less air emission over other modes of transportation

Well-maintained waterways improve quality of life

* Texas Transportation Institute Study, “A Modal Comparison of Freight Transportation Effects on the General

Public, “ Feb 2012

616

478

150

Recreation Lots of water bodies for recreation

77,000 miles of rivers and streams Over 300,000 acres of lakes and reservoirs

Estimated economic impact? 1 to $3 billion annually? Probably understated

Strong potential for growth Over one million boaters in Alabama (266,819 boats registered

in 2011*)Over 3 million visitors to federal recreation sites

annuallyExamples: kayaks on Weiss Lake, number of outfitters,

tubes

* Alabama Marine Police

Power GenerationHydropower provides

8% of power generation in Alabama Immediate response to expensive peak generation demands Helps keep consumer rates low

Other sources of generation Coal-fired plants 59% Nuclear 25% Natural gas 8% Other <1%

27 power generation facilities (63% of AL’s energy production capacity) depend on the waterways

Federal hydropower plants in Alabama alone return $30 million to the federal treasury annually

Water Supply

Water use in Alabama - 10 billion gallons a day* 95% from surface 83% used in thermoelectric production (98% for cooling and

returned)

8% for public supply 5% for industrial use

These users contribute over $7 billion annually to Alabama’s economy

* USGS, Water Use in Alabama, 2005

Flood Control

An economic benefit?

For every $1 spent on flood control, $6 in prevention savings are realized (US Army Corps of Engineers)

In Closing Economic benefits of Alabama’s waterways are almost incalculable The impacts cited yield a greater total economic impact than just the sum

of jobs and revenue

We do know that Without water transportation, costs of shipping goods would be higher Without hydropower, electrical rates would be higher Water recreation is becoming a greater factor in the state’s economy Water supply should be a top priority in any water management policy Flood control is a hidden economic benefit, out-of-sight and out-of-

mind The state cannot fully realize the economic benefits of its waterways

without properly integrating these roles into a sound water management policy

Questions?