Unreliable deliveries of coal and a lack of communication from railroads are hampering the ability of some generation and transmission cooperatives to provide a reliable power supply and driving up costs for their member co-ops, a G&T expert told Congress.
“We cannot keep the lights on unless the railroads deliver the coal,” Emily Regis, president of the National Coal Transportation Association and vice president of the Freight Rail Customer Alliance, recently told the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines and Hazardous Materials in comments submitted for the record during a hearing held in early March: “Stakeholder Views on Surface Transportation Board Reauthorization”.
Regis, who is also fuels resource manager for Arizona Electric Power Cooperative, said railroads have had insufficient crews to operate efficiently and have failed to notify customers of delivery delays, leaving power producers like AEPCO in a lurch.
Poor communication and poor on time rail performance from railroads has further resulted in sidelining railcars and increasing costs to stockpile coal at power plants, she said.
“The variability of service means that a utility can’t predict the size of its stockpile to maintain a target inventory,” she said. “In addition, reliability is compromised when the stockpile falls below a utility’s target inventory.”
AEPCO, a G&T based in Benson, Arizona, relies on Union Pacific Railroad, BNSF Railway and a short line to deliver coal to its power plants, which serve six distribution co-ops with more than 400,000 members.
Regis recommended several remedies to the committee as it considers reauthorizing the Surface Transportation Board, the federal agency that regulates freight rail. They include imposing fines and other penalties on rail companies that don’t meet service obligations and regularly reviewing railroad operations and business practices.
Regis also told the committee that the practice of precision scheduled railroading is at the root of the railroads’ poor and inconsistent service, and she called on the STB to statutorily enforce the railroad’s “common carrier obligations.”
There are only a handful of large Class-I railroads left in the United States, down from around 40 in 1980. Those few carriers move some 90% of the nation’s freight, and new mergers are pending before the STB.
“When railroads face neither effective competition from other railroads nor effective regulation, shippers and the economy suffer,” she said.
Congress has no timeline on when it will reauthorize the STB.