Industry groups, other stakeholders push for greater attention to pipeline integrity

December 30, 2013

This blog has previously discussed some of the environmental compliance concerns being created by the ongoing boom in U.S. oil and gas production. While this turn of events has generated positive economic results, it has also attracted greater scrutiny from regulators, policy makers and the public.

Because of the heightened sensitivity to environmental issues, stakeholders in all segments of the energy industry, as well as consumers with substantial fuel storage capacity, have a strong need to plan for contingencies and ensure the integrity of their operations. But while most regulated organizations are aware of the need to implement common safeguards such as Spill Prevention, Control and Countermeasure (SPCC) Plans, many Americans may not know about an explosive risk that could be lying directly beneath their feet.

DOT: Old pipelines pose a significant risk

According to the U.S. Department of Transportation (DOT), there are more than 30,000 miles of decades-old cast-iron pipes used to deliver natural gas in the United States, despite being in varying states of decay. Leaks in these pipelines not only drain gas from the distribution system, but can cause a dangerous buildup of an explosive substance. Much of this network was laid out before World War II and although this high-risk piping may be particularly concentrated in older cities such as Boston and New York, pipeline safety is a pressing issue in all parts of the United States. Communities in the Southeast certainly need to be aware of the problem.

The Associated Press recently discussed how the need to fix these pipelines has become a point of common ground for environmental organizations, labor unions and energy industry groups. The safety issue is universally acknowledged, but each side has a specific interest in this topic.

For instance, union officials are doubtlessly enticed by the jobs repair projects would generate for workers, while industry stakeholders see that repairing these pipelines will ultimately benefit them financially, as this will facilitate efficient distribution of natural gas and reduce the risk of costly accidents.

At the same time, environmental activists say that they can make progress on multiple goals by getting gas leaks fixed. Delaware Riverkeeper Maya van Rossum told the AP that she doesn't see supporting the repair of natural gas pipelines as contradicting environmentalists' broader agenda.

"To the extent we have a problem we can identify it certainly makes sense to fix it," van Rossum said.

Organizations that have put their support behind the push to address leaking pipelines include:

  • United Steelworkers
  • Consumers Union
  • Sierra Club
  • BlueGreen Alliance
  • American Public Gas Association
  • Natural Resources Defense Council

One factor that is inhibiting progress on this issue is the cost. According to a 2011 report from the American Gas Association, the total cost of fixing these decaying cast-iron pipelines could exceed $82 billion. Currently, repairs of moving forward at a rate of about 500 to 700 miles per year. At this pace, it will take 40 to 60 years to replace all of the at-risk pipes. Stakeholders looking to speed this process up may need to turn to private-sector environmental companies for help developing the necessary engineering solution.

Although ambitious public spending projects are unlikely to gain traction in the current political environment, the issue does continue to receive attention from lawmakers. In November, U.S. Senator Edward Markey introduced two bills focused on pipeline repairs.

Simultaneously, federal officials put focus on refinery safety

As pipeline safety issues have attracted more attention, refineries have also been receiving additional scrutiny. In December, the U.S. Chemical Safety Board (CSB) proposed a new regulatory framework based on the "safety case" system used in Australia, Norway and the U.K.

"In contrast to the safety case, the current [U.S.] regulatory system for process safety is largely reactive, at both the state and federal level," CSB Chairman Rafael Moure-Eraso said in a report describing the board's proposal.

Under the new system, companies would have to provide regulators with "safety case reports" detailing their methods for controlling major hazards and reducing risk to the lowest practical level. Although the proposal would initially only cover refineries in California, it could quickly become a template for new nationwide regulations.

The CSB announced that it would accept public comments on the adoption of a safety case system until January 3, 2014. The board is scheduled to consider formally adopting the proposal at a meeting later that month.

With stakeholders in all parts of the energy industry facing more scrutiny from regulators, it is more important than ever for companies to take a proactive approach to managing their environmental liabilities. For assistance evaluating issues at specific sites or executing environmental engineering projects, property owners should contact experienced environmental consultants.