Utility sues railroad claiming monopoly abuse
JACKSON, MISSISSIPPI - A Mississippi power company has sued Norfolk Southern Railway Company for millions of dollars, claiming the railroad uses a monopoly over coal deliveries to inflate costs.
Hattiesburg-based South Mississippi Electric Power Association SMEPA said Norfolk Southern is the only railroad company that delivers coal from the Appalachias to Plant Morrow, the utility's main electricity generating station located in Purvis, Miss.
The power company claims Norfolk Southern has used that control over coal delivery since 1978 to negotiate price increases of between 60 percent and 80 percent each time the companies' contracts face renewal. The latest contract expired December 31.
The power company also claims Norfolk Southern Railway racked up 130,000 tons of delivery shortfalls in 2010.
"Our rail costs have continued to rise significantly while the service we receive has steadily deteriorated," SMEPA spokesman Kurt Brautigam said in a statement. He added that, regrettably, the utility had no other recourse but to file litigation seeking relief from the "monopolistic abuse" it claims it is subjected to by Norfolk Southern.
SMEPA filed the suit December 29 in U.S. District Court in south Mississippi, but documents related to the case are sealed.
The court docket listed the lawsuit demand as $34 million. Brautigam, however, said the lawsuit seeks $17 million. Brautigan said he didn't know the reason for the discrepancy. The lawsuit was filed under seal and is not open to public viewing.
Rudy Husband, a spokesman for Virginia-based Norfolk, said the company doesn't comment on pending litigation.
The power company said that Norfolk wants a rate increase beginning in 2011 that will be four times higher than the amount the railroad charged under contract as recently as 2003. SMEPA said such a rate hike would be especially hard because it is a nonprofit company.
Brautigam said SMEPA also filed a complaint with the National Surface Transportation Board, saying it was "seeking relief from excessive and unreasonable future rates."
SMEPA provides wholesale power for eleven distribution cooperatives that provide electricity to 406,000 homes and businesses in 52 Mississippi counties.
Related News
IAEA reactor simulators get more use during Covid-19 lockdown
PARIS - Students and professionals in the nuclear field are making use of learning opportunities during lockdown made necessary by the Covid-19 pandemic.
Requests to use the International Atomic Energy Agency’s (IAEA’s) basic principle nuclear reactor simulators have risen sharply in recent weeks, IAEA said on 1 May. New users will have the opportunity to learn more about operating them.
“This suite of nuclear power plant simulators is part of the IAEA education and training programmes on technology development of advanced reactors. [It] can be accessed upon request by interested parties from around the world,” said Stefano Monti, head of the IAEA’s…
