STB OKs CSX Coal Rates

STB OKs CSX Coal Rates

Copyright 2004, Traffic World, Inc.

The Surface Transportation Board ruled that a 45 percent rate hike charged by CSX to Duke Power to move coal from Central Appalachia to three electric generating stations in North and South Carolina was reasonable.

However, the STB also said the disputed rate may be too high to impose at one time and therefore would consider a phase-in plan to mitigate the effect of the increase on the utility and its customers. Duke Power said the increase was costing the company approximately $17 million per year.

"We''re'' pleased that the board found that the rates were fair," said CSX spokesman Gary Sease, adding that it was "too early to tell" if the decision would make it easier for CSX to get rate increases in the future. Duke Power has 30 days to appeal the decision.

Earlier this week the STB reversed its decision in a similar case involving coal transportation rates charged to the utility by CSX rival Norfolk Southern. The board initially ruled last November that rates charged by NS were reasonable.

However, after correcting "computational and technical errors," the STB found that the rates were too high. NS estimated that any required reduction to the challenged rates would be less than two percent.

The board said it would not issue a revised rate until after it reviewed reconsideration petitions by the two parties.