THE RAIL FREIGHT GROUP is urging the Office of Rail Regulation to think again about its proposals for freight charging, which it fears could damage the sector and divert some cargoes to other modes.
The propoposals are outlined in the recent ORR consultation document ‘Periodic Review 2013; Consultation on the variable usage charge and a freight specific charge’.
The RFG has told the ORR: ‘We presently have significant concerns that the proposals as set out could have major repercussions for the stability of rail freight, for investor confidence, and for the prospects of continued growth’.
The ORR is proposing to levy an additional charge on operators moving power station coal, iron ore and spent nuclear fuel, which could amount to an additional £60 million a year. It suggests that this could lead to a reduction of at least 10 per cent in those sectors.
There may also be different charges for various geographic areas, as well as for each locomotive and wagon type, and introducing 'scarcity' or capacity charges.
The RFG said the ORR 'may be giving undue weight to its duty to have regard to the funds available to the Secretary of State, perhaps at the expense of the duty to promote the use of the railway for the carriage of passenger and freight, and the duty to enable companies to plan their businesses with a reasonable degree of assurance'.
RFG Chairman Tony Berkeley added: "The rail freight sector has been growing successfully in recent years, and customer and investor confidence is strong. These proposals risk destabilising this, and turning customers back to road, with its simple and straightforward pricing structure.
"Why does the ORR believe that causing a 10 per cent drop in traffic complies with its duty to promote rail freight? ORR needs to look for different ways of achieving its objectives that are less damaging to rail freight operators and their customers”.