A battle is brewing over just how stringent industry standards for tank cars should be, and the outcome will have dramatic implications for Louisiana.
As 10/12 Industry Report details in a feature from the current issue, freight railroad interests want higher standards than those imposed by the Pipeline and Hazardous Materials Safety Administration. But a national coalition representing chemical, gas, fertilizer and other industry groups wants to block that initiative to streamline oversight of new tank car safety standards and control rising rail transportation costs.
The outcome of the debate is particularly important to Louisiana’s chemical and petroleum producers, since tank cars are purchased or leased by the customers that use them. The Louisiana Department of Transportation and Development ranks Louisiana second in the U.S. in chemicals transported by rail and first in the U.S. in the amount of crude oil transported.
“I don’t think a lot of people realize that our industry owns and/or leases a lot of these tank cars,” says Jeff Sloan, senior director of regulatory and technical affairs at the American Chemistry Council in Washington, D.C., a participant in the petition. “When it comes to adhering to any standards, those are the sorts of things that fall on our industry.”
The new federal guidelines aimed at strengthening tank car standards are the direct result of recent high-profile accidents, most significantly a July 2013 incident in Quebec when a runaway train carrying 72 tank cars of crude oil derailed, igniting 1.5 million gallons of oil and killing 47 people.
In the months that followed, industry groups worked with PHMSA to improve the standards for tank cars, primarily those carrying crude oil and toxic materials. Since the federal guidelines were announced in 2015, there have been many challenges to the rule—both in federal court and in administrative proceedings before PHMSA.
While all parties agree that new industry standards for stronger, safer tank car designs are needed, there is disagreement over the extent of the design changes and who has authority to mandate those changes. Industry manufacturers are petitioning the PHMSA—a direct response to efforts by the Association of American Railroads to impose tank car manufacturing guidelines that go beyond standards issued by PHMSA in 2015—seeking to establish that PHMSA is the ultimate authority for imposing new standards.
Sloan says the petition is currently under official review, with no definitive timeframe given for a decision. Should PHMSA determine that the petition has merit, and subsequently accept it, a rulemaking process will follow.
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