The closing date for submissions on the Discussion
Paper: Capacity Expansion and Access Pricing for Rail and Ports is
30 June 2013.
Users of rail and/or port infrastructure services will be aware
of the importance that capacity expansions play in the life-span of
such infrastructure. Similarly, what prices should be charged for
access to an expanded service is a highly relevant consideration
for both existing users and access seekers.
In Queensland over the last few years, these issues have been
raised with greater frequency as the demand for rail and port
services has at times exceeded the available capacity.
The Queensland Competition Authority (QCA) has
recently released a Discussion Paper that is focused on access
pricing and, more specifically, the pricing of access for major
capacity expansions. The QCA's
Discussion Paper: Capacity Expansion and Access Pricing for Rail
and Ports (April 2013) is a reminder of the criticality of
balancing the requirements of users and access seekers as well as
the interests of owners and operators of rail and port
Key issues canvassed by the QCA
In the Discussion Paper the QCA investigates options for pricing
access to major expansions in rail and port infrastructure. While
the QCA recognises that individual circumstances play an important
role in each case and that there are no hard and fast rules, it
does lay out some key principles based on economic efficiency,
fairness and regulatory governance.
The QCA notes that in addressing questions about access pricing
for major capacity expansions, information about the following
matters will play a significant role:
the existing contractual and institutional arrangements between
the service provider and the access seeker;
details about the access pricing structure, especially whether
simple average cost-based prices or a more complex price structure
the extent to which new capacity is separable-in-use from
whether the new tranche of capacity has a materially higher or
lower unit cost compared to established capacity; and
whether the capacity expansion is driven by general economic
growth where it is not practicable to identify those responsible
for the expansion.
The QCA considers that the issues raised by these points will be
relevant when determining how the cost of a major capacity
expansion should be recovered including who should pay for it.
Call for submissions
The QCA has published the Discussion Paper for the purposes of
creating discussion from relevant stakeholders in relation to these
important regulatory issues. The QCA is inviting interested parties
to make submissions to it. The closing date for making submissions
is 30 June 2013.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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