Refineries, oil producers and railroad companies say they need more time to swap out the old tank cars that carry crude oil and ethanol than the Transportation Department has proposed in a rule to prevent those trains from exploding.
Industry groups said in comments filed late Tuesday that they cannot feasibly retrofit or replace enough of the thousands of “legacy” tankers by the Oct. 1, 2017, proposed deadline without causing oil supply disruptions.
“This rule, if not properly re-worked, could have a significant impact on jobs and the economy,” American Fuel and Petrochemical Manufacturers President Charles Drevna said Tuesday, adding that the agency’s Pipeline and Hazardous Materials Safety Administration’s proposed timeframe was “infeasible.”
The Department of Transportation wants to get the old tankers off the rails following a series of accidents and explosions that have stoked fear about potential disasters, while adding safety features such as advanced brakes and thicker shells to models that adopted 2011 industry-approved safety measures.
The concern reached a head in July 2013, when an unmonitored train carrying crude from the Bakken shale formation in Montana and North Dakota derailed and exploded in Lac-Megantic, Quebec, killing 47.
But industry groups representing oil producers, railroads and refineries rejected the strongest safety measures in the agency proposal, such as the thickest shells for containing flammable liquids and certain types of advanced braking systems, for which environmental and liberal groups had advocated.
It’s a debate that has stretched across communities, flaring up in places where there isn’t any oil production but which tankers pass through. The volume of oil being carried around the country has risen sharply due to shale production. In 2009, there were 10,800 carloads carrying Bakken crude. Last year, shipments surpassed 400,000, according to the Department of Transportation.
Environmental groups, in comments to the agency, pushed the agency to accelerate its timeline for eliminating the older tank cars, with some pressing for an immediate ban.
“DOT falls short of its obligation to ensure that transport of volatile crude oil by rail is done in a safe and responsible manner. The proposed rule would keep thousands of communities in the U.S. and Canada under the continued threat of catastrophic train crashes,” said Devorah Ancel, a lawyer with the Sierra Club.
But implementing the rule quickly, the oil and refining industries said, could cause shortages in oil supply that drive gasoline prices upward. Drevna said AFPM would ask for a 10-year window. The American Petroleum Institute and the American Association of Railroads said in joint comments that older tankers should be eliminated in four years and newer models should have seven years to complete upgrades.
Drevna cited statistics from railcar industry group the Railway Supply Institute that 28 percent of the 98,000 tank cars that currently transport hazardous materials such as crude oil would retire under the proposed rule. But the industry needs a year to ramp up for new builds, has a backlog in the tens of thousands of cars and estimates it could at best churn out 6,400 cars annually.
The Railway Supply Institute could not be reached for comment.
The railroad, refining and oil industries agreed that, with some improvements, the newer tank cars built with the 2011 industry-approved standards should remain on the rails. But there were some variations as to what those retrofits would entail.
AFPM elected to go with the current 7/16 inch shell thickness, while API and AAR said 1/2 inch would be desirable. The Department of Transportation suggested a shell thickness of 7/16 inch and 9/16 inch.
Gerard and Drevna said the thickest shell would yield few safety benefits — they said cars would be heavier and couldn’t carry as much crude, so it would increase the amount of cars on the rails — at a significant cost.
But the Greenbrier Cos., a top railcar manufacturer based in Lake Oswego, Ore., said it preferred the thickest shell, though it said the agency’s suggestions to include “top-fittings” designed to prevent rollovers and advanced braking systems would be unnecessary and ineffective.
Greenbrier is already making tank cars with that thick a shell, and plans to double production this year. It took a swipe at oil and refinery industry concerns by saying those cars carry the same volume of crude oil as the legacy tankers that the proposed rule would phase out.
On speed limits, the railroad, oil and refining industries all said sticking to a 40 miles per hour limit when carrying flammable materials through populated urban centers, while maintaining a 50 mph speed limit elsewhere was desirable.
The railroad industry has been gearing up for that since February, when it struck a deal with the Department of Transportation to voluntarily take steps to address safety concerns.
“Railroads have been at the forefront of advocating for safer tank car standards and we believe the public supports regulation that weighs both safety and the ability to move people and goods in a timely and efficient manner,” AAR President Edward Hamberger said.