Friday, February 4, 2011

S 234 Introduced – Pipeline Safety

Last week Senators Feinstein and Boxer (D,CA) introduced S 234, the Strengthening Pipeline Safety and Enforcement Act of 2011. This is a wide ranging upgrade of various sections of the pipeline safety laws, but it does not address any of the emergency planning and communications issues identified as a result of the San Bruno gas pipeline explosion from last year. In that respect this is not a companion bill to HR 22, but more of a complimentary bill, though there is some overlap in provisions concerning pipeline inspections.

I am kind of surprised that this bill completely passes on the issues of emergency planning and hazard communication. Both areas have been clearly identified as problem areas in pipeline regulation by the results of the San Bruno incident. I would like to think that Sen. Boxer’s Environment and Public Works Committee would correct this deficiency in the hearing and mark-up process.

Increased Enforcement

Probably the most important part of this bill (§3) from an enforcement perspective is the increase in the number of PHMSA personnel to enforce pipeline safety regulations. The bill would add 100 full-time positions over the next four years to the agency for pipeline safety activities. Unfortunately, the increase in the number of pipeline inspectors will only be a relatively small part of the new positions. Most of the new positions will provide the technical, legal, and administrative support needed for enforcement activities.

Requires New Safety Regulations

The bill would require a number of new regulations to be developed by PHMSA. The new regulations would address:

• Required installation and use in pipelines of remotely or automatically controlled valves (§6);
• Standards for natural gas pipeline leak detection (§7);
• Verification of maximum allowable operating pressure (§8); and
• Minimum safety standards for transportation of carbon dioxide by pipeline (§13);
Expand Coverage of Current Regulations

The legislation would expand the coverage of existing regulations by:

• Changing requirements for designating ‘high consequence areas’(§9);
• Including coverage of ‘gas gathering lines’ and ‘hazardous liquid gathering lines’ (§10);
• Including coverage of ‘non-petroleum fuels’ and ‘biofuels’ as hazardous liquids (§11)
Expand Fines and Fees

Provisions in this bill (§4) would increase the maximum civil penalties for the most serious violations to $250,000 per violation per day up to a maximum of $2.5 million for a related series of violations. The same section also authorizes the imposition of civil penalties for obstructing or preventing the Department from conducting investigations or inspections under the pipeline safety rules.

The Secretary would be authorized by this bill to collect fees to recover the costs of conducting design reviews for new pipelines. Those fees would be placed into a “Pipeline Safety Design Review Fund”. Other fees would be authorized for the processing of pipeline safety waivers (for the Pipeline Safety Special Permit Fund).

Hazardous Liquid Pipeline Study

Section 18 of the bill would require the almost mandatory study that Congress is so enamored with. In this case the Secretary is required to conduct a study of:

“…the transportation of non-petroleum hazardous liquids by pipeline for the purpose of identifying the extent to which pipelines are currently being used to transport non-petroleum hazardous liquids, such as chlorine, from chemical production facilities across land areas not owned by the producer that are accessible to the public.”
The purpose of the study is to determine how well the States are regulating these pipelines. State regulation would normally be expected since these relatively short pipelines between producer and user of these hazardous chemicals rarely cross State lines. Congress has broad authority to regulate interstate commerce, but would have to show some great need to protect safety and/or security to regulate purely intra-state commerce.

While it is not specifically stated in the bill, it would seem fairly obvious to me that the drafters of this bill were looking to the results of this study to justify Congressional action to regulate such pipelines.

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