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Arkansas utility asks customers to back railroad antitrust legislation

This item comes from the Stephens Media Group newspapers.

Utility urges customer involvement in rail legislation fight
Saturday, Jul 21, 2007

By Aaron Sadler
Stephens Washington Bureau

WASHINGTON – A northwest Arkansas electric company took the unusual step this month of asking customers to turn up pressure on lawmakers in Washington over railroad antitrust legislation.

The Carroll Electric Cooperative added a one-page flyer to its monthly bills seeking customer help in support of congressional action to rein in what utilities see as out-of-control costs and unreliable rail delivery of coal.

Enterg, the dominant electricity provider in Arkansas has sued Union Pacific over delays of coal shipments from Wyoming. I wrote about dispute last year in the Arkansas Democrat-Gazette.

Entergy contends that Union Pacific “in a conscious and deliberate practice” limited supplies of Powder River Basin coal to manipulate demand and ultimately maximize its own profits. The railroad blames the ordinary wear of coal dust on the roadbed and signals, in addition to bad weather for the lack of service. Thankfully, federal courts and our Public Service Commission will be left to sort the excruciating details.

While this dispute certainly deserves to be heard in the appropriate judicial forums, the hometown electric utility may have a tough time proving its’ charges against one of America’s largest and most historic railway companies. Union Pacific would appear to have a feasible defense against the allegation of a “conscious and deliberate practice” contrary to the best interest of Entergy. Put in the simplest terms, U. P. railroad might credibly contend that it is not well enough organized or managed to pull off the kind of highly orchestrated and ruthless campaign suggested in the legal pleadings

Railroad congestion is a serious problem and Amtrak is not the only user of the nations transportation network to suffer. Arkansas’ Public Service Commission says the virtual monopoly on rail shipments has cost ratepayers around here over $200 million.

The freight railroads take a somewhat different position.

Railroads respond shipping rates are 61 percent lower now than in 1980 and that freight rail companies are spending $10 billion this year to expand infrastructure on an increasingly clogged rail network.

In addition, they maintain the federal Surface Transportation Board is effective in handling rate cases.

Arkansas’ three Democratic representatives back antitrust legislation. As one might expect, Rep. John Boozman (Rep – Wal Mart) is not yet in the fold. Neither, so far, are Senators Lincoln and Pryor.

Senator Mark Pryor says we actualy need laws addressing rail congestion, so long as his solution is not Boozman’s scapgoating of Amtrak, he certainly has a point. Rail lines are obviously essential for moving much of what we need to et by. They were built on public-private partnerships, and there is no reason that should not be the case today.

Of course, part of the ongoing deal must be allowing Amtrak to take advantage of the increased capacity.

Is the antitrust legislation a good idea? My gut says “yes,” but I have been wrong before.

Filed under: Passenger Rail Politics, Passenger Rail Transportatio Policy

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