As I had mentioned in an earlier posting Sen Cantwell (D,WA)
introduced S
859, the Crude-By-Rail Safety Act. The bill is an attempt to
comprehensively address the safety issues involved in the shipment of crude oil
by railroad.
Definitions
Section 2 provides definitions of terms used in this bill.
They include:
∙ High-hazard flammable train;
∙ Oil;
∙ Rail carrier; and
∙ Worst case discharge
The HHFT definition is essentially the same as PHMSA used in
their notice of proposed rulemaking. As I mentioned
in my post about that NPRM, this expansive application of the definition of
HHFT could affect many more industries than just the crude oil and ethanol
industries originally intended.
The definition of oil is also overly expansive. The authors
were attempting to insure that they covered all of the crude oil sources in
their definition, but by defining ‘oil’ as “oil of any kind
or in any form” {§2(2)}
they have also included non-hazardous (for rail transport) oils such as mineral
oil and vegetable oils.
Rulemaking
Section 3 of the bill sets out a number of safety
rulemakings required to be completed by the Secretary of Transportation. This
section sets out a 90-day time limit to issue a final rule on each of these
rulemakings. The time limit is part of a congressional over reaction to the
lengthy time that it takes federal agencies to complete rulemakings.
Unfortunately, meeting the 90-day limit is not possible if the agency is to
complete the congressionally mandated process for rulemaking and this bill does
not provide the agency with an exception to that process.
Section 3(a) requires the Secretary to establish an interim
standard for the maximum volatility of crude oil (not defined in the bill; perhaps
the definition of ‘oil’ should be changed to ‘crude oil’) based upon vapor
pressure. As I mentioned in my discussion
of HR 1679, the use of vapor pressure as a standard is going to have to be
set for a specified temperature that can be expected to be reached incident to
transportation. Setting a vapor pressure standard for any other temperature will
not adequately reflect the maximum vapor pressure obtained in transportation. A
good operational definition would be 10% lower than the setting of the pressure
relief device at 140°F
using test method ASTM D6336.
Section 3(b) would then require the conduct of a formal
study to set a final crude oil volatility standard. The study would conducted
by DOT in conjunction with DOE instead of being done by one of the independent
scientific bodies usually tasked with such studies. There is a two year time
limit to conduct the study with a follow-on requirement to establish that standard
by regulation in Section 3(c).
Sections 3(d) and (e) would require the completion of the
current HHFT rulemaking within the 90 day limit. Since the final rule is
currently scheduled to be published on May 12th (according
to the House Committee on Transportation and Infrastructure) these two sections
may be superfluous.
Unsafe Tank Cars
Section 4(a) establishes minimum safety standards for tank
cars in oil and ethanol service. The Secretary is required to “immediately
prohibit the shipment of oil” in DOT 111 cars that have not been upgraded to
the CPC 1232 standards or in unjacketed CPC 1232 rail cars. Here is where the
overly broad definition of oil would prohibit the use of these tank cars for
non-hazardous products.
Ethanol shippers would have two years to stop using the same
cars prohibited above.
Paragraph 4(a)(3) adds an vague requirement for shippers of ‘oil
and ethanol’ to “take additional precautionary measures to enhance the safe
shipment of such liquids, including by avoiding the shipment of such liquids in
tank cars with unsafe tank car attributes identified by the Secretary of
Transportation, to the extent practicable”. The ‘measures to enhance the safe
shipment’ phrase is so vague as to be meaningless. The ‘avoiding… to the extent
practicable’ phrase, on the other hand, seems to allow continued use of DOT 111
railcars if the discontinuance would not be ‘practicable’. I’m pretty sure that
that was not the intent, but it certainly seems to be what the words mean.
Rail Inspections
Section 5 addresses the issue of the inspections. Section
5(a) requires additional rail and rail geometry inspections on routes over
which even 1 HHFT train is operated but it does not provide a time limit of how
often that one train operates on that line. Since the time frame for the
inspections are ‘per calendar year’, perhaps the intent is one HHFT train per
year.
Section 5(b) address the shipper inspection requirement to
sample and test 5% of the rail cars loaded with crude oil for volatility and to
ensure that they meet the interim volatility standard set above. Interestingly §5(b)(1)(B)(ii) requires
that the final volatility standard is more restrictive than the interim
standard. This was not part of the requirements of §3(b).
DOT is required by §5(b)(2)
to conduct their own spot checks of crude oil volatility, though no inspection
rate is specified. Additionally, DOT is required to audit shipper records of
their 5% volatility. Again no audit frequency standard is specified and it is
unclear how PHMSA (the agency responsible for Hazmat issues) manpower would be
able to conduct a reasonable rate of audits of crude oil shippers.
General Fine Increase
for Hazmat Violations
Section 6 makes substantial increases in the maximum fines
set in 49
USC 5123 for violation of US Hazmat transportation laws. The fine for
knowingly violating provisions of 49
USC Chapter 51 is increased from $75,000 to $500,000 per violation {§5123(a)(1)}. The maximum
for the enhanced penalty (resulting in death, substantial destruction of
property, or significant environmental damage) is raised from $175,000 to
$1,000,000 per violation {§5123(a)(2)}.
Interestingly, the way the amendment of §5123(a) is written it erases
the current §5123(a)(3)
which deals with the reduced penalties for violating the training requirements
of Chapter 51. It does not appear that this was done intentionally.
Since none of the requirements in the earlier sections of
this bill made any modifications to Chapter 51, violations of these
requirements would not be covered by §5123(a) (which calls into question why §6(a) was included in
this bill). As a result §6(b)
and (c) make violations of volatility rules and the inspection rules of this
bill finable at the enhanced violation rate.
Transportation Safety
Programs
Section 7 requires the Secretary to ‘establish or expand’
ten different safety programs or initiatives relating to the transportation of ‘energy
products or other Class 3 flammable liquids’ by all land modes. The section
would authorize $40 million for this establishment or expansion.
Oil Spill Response
Plans
Section 8 requires the Secretary (within 180 days) to amend 49
CFR 130, Oil Spill Prevention and Response Plans to address issues related
to discharges from unit trains or blocks of tank cars. Specific measures to be
addressed include:
∙ Current 1,000 barrel minimum container size “to account
for worst-case discharges resulting from accidents involving unit trains or
blocks of tank cars” {§8(b)(1)(A)};
and
∙ Plan requirements for discharges
that may impact “a water body or other area that is subject to the jurisdiction
of the Coast Guard or of the Environmental Protection Agency” under 33 USC 1251
et seq {§8(b)(1)(B)}.
This section only addresses classical oil spill response
plans that deal with limiting the spread of spilled oil, cleaning up that oil
and then mitigating the damage done by the oil. It does not address the fire
hazard in any way.
Disclosure
Requirements
Section 9 expands on the current DOT
Emergency Order requirements to notify State Emergency Response Commissions
(SERCs) of oil train routes. It would require prior notification of SERCs and
Local Emergency Response Committees along routes over which even one HHFT would
travel. There is no mention of restrictions or requirements on information
sharing by those local agencies.
Emergency Response
Resources
Section 10 requires the railroads to “collaborate to develop
an inventory of emergency response resources along routes over which 1 or more
high-hazard flammable trains operate” {§10(a)}.
The inventory would include both spill control equipment and equipment to
respond to fires and explosions. The inventory would also include where the
equipment was stored and point of contact information for that equipment.
The railroads are required to provide DOT access to the
inventory (not provide DOT with a copy) and to make relevant portions available
to emergency response personnel upon request.
There is no requirement to have any certain amount of
equipment available. Nor is there a requirement to have it available at any
specific point in time relative to an accident.
Close Call Reporting
Section 11 amends 49 USC by adding a new section; §20168, Confidential
close call reporting. The new section would require the Secretary of
Transportation to publish regulations (within 1 year) to outline requirements
for railroads to establish a close call reporting program. The railroad
programs would include the following elements {§10(d)}:
∙ Provide a safe environment for its employees to
report unsafe events and conditions;
∙ Ensure reporting employees are
protected from railroad carrier discipline;
∙ Use collected information to
develop and implement targeted corrective actions;
∙ Use collected information to
supplement inspection data in identifying safety issues and emerging risks
before they develop into accidents.
While there is nowhere in the new section that requires
sharing of the reported information with DOT, §20168(g) does allow the Secretary to use the
information when:
∙ When implementing or updating the
Federal Railroad Administration’s National Inspection Plan;
∙ When performing focused
inspections; or
∙ When developing agency
rulemakings and guidance, as appropriate.
It is hard to see how the industry would not see the second
use as a way around the prohibition of using the information produced in
regulatory actions. This allowed use of the information would probably stifle
railroads from sharing the reported information with DOT.
Reports to Congress
No legislation that billed itself as comprehensive could be
complete without at least one report to Congress. This bill has two. The first
is a report contracted out to the Transportation Research Board of the National
Academy of Sciences on liability and insurance issues for HHFT. The second is a
multi-departmental review of the current regulations concerning the
transportation of energy products by all modes of transportation.
Moving Forward
Given the Republican control of the Senate there is almost
no way that this bill will be considered in committee (Senate Committee on
Commerce, Science and Transportation).
Commentary
The big problem with this bill is the immediate phase out of
the DOT 111 cars. While everyone understands the safety concerns with those
cars, the current level of flow of crude oil to refineries cannot continue in
the near future without the use of these cars. Shutting down that flow to only
what the jacked CPS 1239 cars and the newer tanker cars can carry would cause
most drilling operations in this country to cease. The economies of North
Dakota, Wyoming, Colorado, Oklahoma and Texas would take a severe hit, in some
cases a devastating hit.
More importantly there would be a huge surge in gasoline and
natural gas prices that would hit the entire economy as the United States
suddenly had to compete with the rising gasoline consumption economies of China
and India on the international market. It would provide a huge surge of money
to Russia, Venezuela, Iran and probably ISIL; money that would further stabilize
their current regimes and advance their anti-American agendas.
On top of all of that the bill is poorly written with all
sorts of obvious unintended consequences.
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