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Urban rail news in brief - July 2015
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RAIL operators warn the carbon price could backfire by providing a financial incentive for businesses to move more cargo on to heavier-polluting trucks and drive up the costs of groceries.
Asciano's rail freight business, Pacific National, is imposing a 1.34 per cent "carbon cost surcharge" on rail freight, with the diesel fuel rebate slashed by 6.21c per litre from July 1 under the Gillard government's carbon tax.
It has told customers in a letter obtained by The Australian that the surcharge would be adjusted when the carbon price varied and that it regretted having to pass on the increases to other businesses.
Last night, Asciano chief executive John Mullen said it was "somewhat counter-intuitive" that at a time when government was trying to cut greenhouse emissions it was imposing a carbon price on rail, but trucks were exempt until mid-2014.
"It does send a rather confusing message, shall we say, to the industry," he told The Australian.
A QR National spokesperson said last night that it had advised customers of revised freight rates that took into account the reduction in the fuel tax rebate and increased electricity costs of the rail network.
Australasian Railway Association chief executive Bryan Nye said the situation could lead to higher emissions from the transport sector if freight users switched to trucks. Mr Nye also warned of higher grocery prices, especially in the Northern Territory, northern Queensland and Western Australia because they were more reliant on rail to deliver food and consumer goods.
Mr Nye said rail operators faced $110 million extra in yearly costs because of the carbon tax. "That will have to be passed on."
Opposition finance spokesman Andrew Robb said these costs were a blow to the competitiveness of companies and that rail should be promoted as an efficient way of moving cargo.
"This will hit hundreds of thousands of businesses which are competing against imports and who are also trying to get goods into export markets as cost-effectively as possible," Mr Robb said. "These are further costs which are not being borne by our international competitors.
"Any major regional centre relying on rail freight will face these added costs as will consumers in these markets as the carbon tax costs are passed through."
However, a spokesman for Climate Change Minister Greg Combet said that because rail freight operators were already efficient fuel users the cuts to their diesel fuel tax credits would be modest. "Given the modest impact and the policy to include heavy on-road transport from 1 July, 2014, the government does not consider that the rail industry will be disadvantaged," Mr Combet's spokesman said.
"The modest cost impacts on rail transport have been factored into the expected 0.7 per cent CPI rise and that is why the government is delivering a comprehensive household assistance package, which provides an average of $10.10 per week."
This article first appeared on www.theaustralian.com.au
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