Incremental pricing 'costly for operators'


Operators may be financially burdened by incremental pricing scheme, as NTC hears call for fuel-only charging system

By Brad Gardner

The trucking industry may be financially burdened by an incremental pricing scheme, which is being opposed in favour of a fuel-only charging system.

The National Transport Commission (NTC) has been told to scrap plans to charge operators for carrying an extra 10 percent mass because it will be costly and lead to overcharging.

In its submission opposing incremental pricing, the Australian Trucking Association claims the NTC’s proposal will not deliver greater access even if operators invest time and money adopting the scheme.

As an alternative, the ATA suggests fuel-only charging, saying there is a better alignment between use and charge because the latter varies with consumption.

"These benefits are arguably increased now there is a focus on energy efficiency," the ATA says.

According to the submission, road agencies and operators will need to invest in new computer systems to comply with the scheme, which may be to no avail.

"There is no evidence that incremental pricing will deliver access to the routes where the demand for moving high volumes of heavy commodities is," the submission reads.

The ATA’s submission also warns of the potential for operators to be charged once under the PayGo cost recovery model and once under incremental pricing.

"Trying to run a forward-looking incremental pricing option within a cost recovery charging model may lead to double charging," the ATA says.

Under PayGo, charges are set according to vehicle classes, while incremental pricing charges for mass.

The ATA also claims the incremental pricing network being discussed is "restricted" and may be exposed to compliance issues among road agencies.

"Evidence is that the ultraconservative approach to network utilisation continues," the submission says.

In order to gain industry support, the ATA says governments must commit to "broad scale network access". The group, however, says recent history involving Higher Mass Limits and Performance Based Standards raises doubts over whether this is achievable.

Questions have also been raised over how an incremental price can be set, with the ATA saying charges need to vary because infrastructure expenditure levels and the impact heavy vehicles have are location-specific.

The NTC has also been called to oppose any moves to link the Intelligent Access Program (IAP) or PBS to incremental pricing.

The ATA says operators should only be required to comply with manufacturer mass limits.

The move to incremental pricing is part of the Council of Australian Governments’ road pricing reform agenda, which the NTC says is aimed at increasing productivity.

By allowing trucks to carry more mass in return for paying for the road wear caused, the NTC’s Meena Naidu says there will be fewer trucks on the road, "resulting in lower freight rates, better safety and fewer transport emissions".

Naidu says revenue from incremental pricing may also be used to fix infrastructure bottlenecks. The ATA, however, says the industry should not be forced to pay for funding shortfalls.

You can also follow our updates by liking us on Facebook