Following the ECJ ruling, Germany now needs to reform its TAC system. This is proving to be a politically sensitive task: the German states, who fund local passenger rail, fear that they will no longer be able to so if prices go up. Under the existing pricing system, charges for local passenger rail are tied to funds given to states for the local rail operations.

The transport ministry is aiming for a renewed system by 2027: “Our goal is and remains to present a new track access charge system by the timetable change in 2027”, minister Schnieder said earlier.

That timeline does not satisfy the rail freight sector. These companies are hoping for short-term clarity for their own financial planning. Without knowing what’s coming, such planning becomes guesswork. If they plan ahead with a price that’s too high, they could lose customers. If they calculate with a price that is too low, they might have to compensate for additional costs later, writes German publication DVZ.

Full-cost or marginal-cost?

Lastly, there is the question of the TAC model. Currently, Germany charges infrastructure usage fees on the basis of the full-cost principle. The rail freight industry has spoken out in favour of a marginal-cost pricing system, where companies pay only for the infrastructure costs added by an additional train and a possible efficiency markup. A study by INFRAS, commissioned by rail freight association Die Güterbahnen, has shown that this could reduce TACs by 54% for freight operations.

The marginal-cost system is the standard pricing model in Europe. However, the German transport minister has expressed concerns that its implementation in Germany would lead to a major financing shortage for the railways.

Die Güterbahnen claims otherwise: “Contrary to repeated claims by the Federal Ministry of Transport, such a switch would not create a funding gap, and therefore there would be no additional burden on the federal budget if three existing federal funding streams were consolidated simultaneously”, the association wrote.

Supposedly, the eight billion missing euros are already provided for indirectly. The German government provinces retroactive TAC subsidies, the local public transport funds and planned maintenance subsidies.

“Track charges based on marginal costs lead to more traffic and thus higher revenues. The current full-cost system, on the other hand, stifles traffic and makes the network operator sluggish. The figures show: The alleged funding gap is a political scare tactic – nothing more”, Die Güterbahnen’s Managing Director Peter Westenberger commented earlier.

The subsequently higher TACs for rail freight have been a major annoyance for the industry. Higher charges bring about higher costs. This hinders the competitiveness of rail freight companies. They already struggle to compete with the road sector.

“This ruling is the final nail in the coffin for the current German track access charge system”, commented Die Güterbahnen Managing Director Peter Westenberger.

Multi-million euro refunds

“Federal Transport Minister Schnieder must now prioritise presenting proposals for a fair, legally sound, reliable, and effective track access charge system that will boost transport volumes. We demand that the incorrect track access charge calculations for 2025 and 2026 be reversed as quickly as possible.”

The ruling is great news for TAC-paying rail freight companies operating in Germany. They can reclaim the overpaid charges. They expect the total figure to amount to a “three-figure million-euro sum”, between 100 million and 999 million euros.