This piece originally appeared in Bloomberg Law.
A dispute at the Surface Transportation Board between Navajo Transitional Energy Co. in Montana and BNSF Railway, America’s largest freight railroad, is headed to the courts. The STB will likely lose on administrative grounds for forcing the discount shipment of millions of tons of coal.
The case demonstrates how common carriage, which requires freight rail service for regulated traffic such ascoal and chemicals, is increasingly difficult to support as a regulatory concept. Common carriage lacks political consensus, grows less relevant in competitive markets, and threatens to undermine climate goals.
Contract negotiations between NTEC and BNSF broke down last year, and NTEC complained to the STB, the agency where shippers and freight rail resolve such issues. NTEC charged that BNSF failed to meet its common carrier obligation, which by law requires a railroad to serve all customers at reasonable rates and levels of service.