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Position Statement <br /> Captive Rail Shippers Need Reform <br /> Nearly 40 percent of total US <br /> electricity comes from coal.About <br /> 46%of the electricity generated <br /> in Minnesota came from coal-fired Prpt <br /> electric power plants in 2013. That _ <br /> coal is typically shipped by rail, <br /> often by a single railroad,with „,.. ' <br /> no transportation alternatives, <br /> making the utility coal customer <br /> "captive"to the railroad. <br /> Over the past year electric utility <br /> captive shippers have experienced ¢. <br /> unprecedented delays in delivery • <br /> of coal. Coal stocks at many power <br /> plants have often dwindled to 4 <br /> dangerously low levels, potentially <br /> threatening the reliability of the I <br /> electric system.And despite the <br /> poor service, costs remain very = . <br /> high. The rail transport costs <br /> are often far higher than the cost The Willmar Municipal Utilities combined heat and power plant is adjacent to railroad <br /> of the delivered product itself. tracks,and relies on the railroad for fuel deliveries.The utility is among those who have <br /> This also occurs in other key had frustrations with what appears to be a straightforward issue: delivering fuel to <br /> sectors of the economy, including power plants.Pictured is Wes Hompe,now the utility's general manager. <br /> agriculture, chemicals, pa er <br /> , <br /> steel, and many more. <br /> customers to enhance rail competition and improve <br /> Two public power communities, Hibbing and Virginia, customer protection provisions.We also support <br /> are trucking coal from Superior, Wisc., because they removing exemptions from antitrust law long enjoyed by <br /> can't arrange for rail delivery of coal to their power the rail industry. <br /> plants at a reasonable cost.As a result,Virginia pays <br /> $58.77 per ton for delivered coal, and only $13.30, or 23 <br /> percent,is for the coal itself. <br /> The Surface Transportation Board has shown an <br /> increasing level of interest in the concerns of shippers in <br /> recent years,but overall it has had little or no effect on <br /> the dominance of the railroad industry.We appreciate <br /> the fact that the STB recently required BNSF to submit "*,, <br /> plans to deal with dwindling coal supplies at utilities. <br /> But the STB lacks both the authority and the will to try <br /> take the steps necessary to force railroads to provide _ --, <br /> adequate service at fair prices. <br /> MMUA Position <br /> Legislation is necessary. Lack of competition in the rail -, ; _ ts, <br /> industry,coupled with the lack of access to regulatory <br /> relief, threatens electric reliability in Minnesota and Agricultural interests are also keenly aware of the need for rail <br /> throughout the coal-dependent Midwest.We support reform.Agriculture is important economically to many MMUA <br /> the STB reform initiatives endorsed by freight rail member communities,including Warren(pictured here). <br /> 2015 Federal Position Statements/9 <br />