Rail Competition

Electric utilities are experiencing higher and higher rates to ship coal to their coal-fired generation plants. This is because in most areas of the country, shippers have only one or at most two railroads from which to seek shipping services. As a result of rising rates, a number of utilities are experiencing declining coal stock piles, necessitating the burning of natural gas or electricity purchases and in turn raising the costs to consumers.

The lack of competition and the lack of efficient regulatory oversight subjects rail shippers — such as co-ops that ship coal by rail — to high prices and exploitation at the hands of the rail industry.

NRECA is supporting legislation with three primary objectives:

  1. To maintain consistent and efficient rail transportation service for shippers, including the timely provision of rail cars requested by shippers.
  2. To promote effective competition among rail carriers at origins and destinations.
  3. To maintain reasonable rates in the absence of effective competition.