The highly profitable U.S. freight railroad industry, operating in what some call a renaissance, will be facing more organized customers who are not happy with the cost they’re paying and the service they’re getting.
A national organization for freight rail shippers announced a new name, ambitions for a broader range of members, which now includes Tri-State, and new hopes for reforming federal regulatory policies that apply to railroads they think are taking advantage.
The new Freight Rail Customer Alliance (FRCA) is for those in all industries working to improve access to reliable rail service at competitive prices, said David Sauer, who is president of the alliance and also CEO and senior vice president of Dakota Gasification Co., a North Dakota subsidiary of Basin Electric Power Cooperative in Bismarck.
The customer alliance website throws down the challenge: “The lack of competitive transportation options for rail-dependent shippers has forced them to pay monopoly rates and often receive unreliable service. The costs of rail shipping have skyrocketed, particularly for those shippers served by a single railroad. In fact, since 2003 – through one of the nation’s worst economic periods – freight rail rates in general have increased two and a half times the rate of inflation and two and a half times the level of truck rates. Rates for individual shippers served by a single railroad have increased even more. These unreasonably high rates are hurting our national economy by rendering certain producers and manufacturers uncompetitive, reducing the profits of American companies and driving up the cost of everything consumed by Americans from electricity to cereal.”
Among the members of FRCA, are Basin Electric, Tri-State and Lincoln Electric System, which share in the ownership of the 1,710-megawatt Laramie River Station (pictured). The Wheatland, Wyo., generating plant has only one option for the delivery of coal from Wyoming’s Powder River Basin, the BNSF Railway.
Tri-State has a 24-percent capacity ownership in Laramie River Station. More information can be found on FRCA’s website at www.railvoices.org.