Growth Energy calls on STB to address 'substandard' rail service for ethanol shipments

A Surface Transportation Board (STB) order issued on June 20 required BNSF Railway Co. and Canadian Pacific to resolve backlogs of rail cars for grain orders, but failed to address substandard rail service for ethanol deliveries, according to Growth Energy, which represents the interests of ethanol producers and supporters.

So, Growth Energy Chief Executive Officer Tom Buis sent a letter to the STB yesterday outlining the ethanol industry's concerns about rail shipment delays and requesting immediate action.

"Earlier this year, we saw ethanol supply dwindle and prices skyrocket solely because of the inability to get rail cars to ship product — even to the point of having many plants reduce production," he wrote. "Ultimately, these service failures hurt the American consumer as these costs are borne in the form of higher gasoline prices, which impact every segment of the American economy."

Because more than 61 percent of all ethanol is delivered by rail, it 's imperative that the rail service issues be directly addressed and given the same priority as grain shipments, Buis believes.

"We feel as though it is necessary for the board to immediately act to ensure that the railroads improve their service," he wrote.

The highest-volume chemical moved by U.S. railroads is ethanol, according to the Association of American Railroads (AAR). Through June, U.S. roads moved 788,477 carloads of chemicals, up 1.4 percent compared with the same 2013 period, AAR traffic data shows.