APPLICATION OF COSTING AND RATEMAKING CONCEPTS OF THE NATURAL GAS PIPELINE INDUSTRY TO THE RIGHT-OF-WAY OF AMERICAN RAILROADS

An examination of the feasibility of applying the costing and rate-making principles of the interstate natural gas pipeline industry to the railroad rights-of-way. The origin of railroad and gas pipeline accounting systems are described and their similarities and differences noted. A detailed description is presented of the overall cost of service for the gas production, gas storage, and gas transmission functions of the pipeline's operations. Also included are the regulatory and judicial precedents for the allocation of fixed costs between demand and commodity components according to pure peak responsibility, the Seaboard formula, and the United formula. It is concluded that when fixed and variable costs are identified for railroad rights-of-way, the pipeline's method of two-part pricing and two-part costing could be applied to that part of the railroad's traffic that has monthly or seasonal usage. It is recommended that a study be conducted using real data from individual railroads to test empirically the applicability of pipeline costing to railroad rights-of-way.

• Corporate Authors:

  Zinder (H) and Associates

  1828 L Street, NW
  Washington, DC  United States  20036

  Federal Railroad Administration

  Office of Policy and Program Development, 1200 New Jersey Avenue, SE
  Washington, DC  United States  20590
• Authors:
  • Berman, D
  • JOHNSTON, K
  • Ecklund, G
• Publication Date: 1979-7

Media Info

• Pagination: 105 p.

Subject/Index Terms

• TRT Terms: Accounting; Alternatives analysis; Analysis; Contract rates; Costs; Fixed costs; Gas industry; Gas pipelines; Interstate transportation; Level of service; Natural gas distribution systems; Peak periods; Pipelines; Pricing; Property acquisition; Railroad facility operations; Railroad transportation; Rate making; Rates; Regulations; Right of way (Land); Traffic managers; Variable costs
• Identifier Terms: U.S. Interstate Commerce Commission
• Uncontrolled Terms: Cost analysis; Line capacity; Services; Shippers
• Old TRIS Terms: Government regulations; Peak capacities; Rates costs
• Subject Areas: Economics; Finance; Law; Pipelines; Railroads; Terminals and Facilities;

Filing Info

• Accession Number: 00313248
• Record Type: Publication
• Source Agency: National Technical Information Service
• Report/Paper Numbers: FRA/OPPD-79-17 Final Rpt.
• Contract Numbers: DOT-FR-8161
• Files: NTIS, TRIS, USDOT
• Created Date: May 21 1980 12:00AM