Thursday 27th Oct 2016 - Logistics Manager

Rail freight relief at charges decision

There is relief among rail freight operators that the ORR has not implemented more draconian increases in freight charges, according to the Rail Freight Group.

As part of a package of reforms, ORR decided that:

* Increases in the variable access charges for freight will be capped at an average 10 per cent compared to the 23 per cent previously announced. The RFG said this was likely to reduce charges for intermodal traffic, and limited the impact of rises in the bulk markets such as aggregates and steel.

* The proposed 400 per cent increase to the capacity charge for freight will not be implemented and a revised approach will be developed.

* The previously announced caps on the freight specific charge for ESI coal, iron ore and spent nuclear fuel will be reduced. For ESI Coal, for example, the cap will reduce from £4.04 to £1.04 per kgtm.

*Biomass will not be subject to a new freight specific charge in control period 5.

The ORR’s decisions on freight charges were announced as part of the Draft Determination of the Periodic Review 2013.

Maggie Simpson, RFG executive director said: “We are pleased that ORR has listened to the concerns of the industry and has taken a balanced decision that is affordable and fair.

“This will be a great relief to rail freight operators, customers and those seeking to invest in the sector who can now develop their business plans with confidence.”