New regulations and standards on rail tank cars carrying highly flammable crude oil were announced last month. Many of these new regulations are steps in the right direction with regards to improving the safety of the shipment of crude oil via rail, but there are still many who say the regulations do not go far enough.
Meanwhile, the oil and rail industry have made many claims that the regulations go too far.
The new regulations are pertinent to Boulder County, which has seen an increase in crude oil traffic on its railways in the last several years. As many as 10 trains carrying crude oil will pass through Boulder County in a given week, and as Boulder Weekly reported earlier this year, the rails on which that crude oil is transported have potentially disastrous flaws: outdated technology, steep curves and inclines and old foundations.
Oil trains traverse the rail in Boulder County simply because there is too much traffic on main lines east of the area. What was once a spillover track, the line in Boulder County, which is owned by Burlington Northern Santa Fe, has been put into more and more use as oil and gas companies and railways figure out how to improve and expand their more heavily trafficked lines.
Given that trains carrying explosive crude oil will continue to roll through the hearts of Longmont, Boulder, Louisville and Lafayette, the new regulations will have an immediate impact, but it’s not as large as it might be if not for a number of factors, including the way the rules were written, how much lobbying expenditures went into the new regulations and what type of cargo the rules affect.
In total, the new regulations cast a wide net at reining in the transport of crude oil: they update tank cars, reduce train speed, alter routes and more scrupulously classify hazardous materials. But going through the main tenets of the update piece-by-piece reveals objections from watchdog groups.
The biggest piece of the new regulations is the updated standards of tank cars and the removal of dangerous tankers from the rails. Outdated cars like the DOT-111 have been known to combust when carrying the highly flammable crude oil pulled from the Bakken fields in North Dakota. In response to this, all DOT-111 cars and similarly dated models will be pulled from the rails.
The immediate phase out will call for the most dangerous and unsuitable of these tank cars to be pulled by 2018. However, the regulations do not apply to a second generation of unsafe cars, built after 2011, which will have a 10-year period in which to be removed. You can do the math, but that means tank cars that we know are dangerous will be running through towns until nearly 2030.
Furthermore, oil and rail industry personnel have almost complete control over determining the level of hazard caused by a DOT-111 carrying crude oil. This will cause DOT-111s carrying explosive crude oil to stay on the rails for more than a decade. Companies shipping oil determine if their cargo is Packing Group I (most hazardous), Group II (less hazardous) or Group III (least hazardous). DOT-111s classified in Group II or III will receive an extra 10 years for removal, and that’s dangerous because volatile crude oil from the Bakken area, and that from tar sands, can legally be classified as Group I, II or III, by the oil producers themselves. (Oil from the Niobrara, which is what typically passes through the county, is typically graded in Group II or III.)
The lack of oversight or standards in this process will be challenged in court, says Kristen Boyle, an attorney with Earth Justice, a legal group that reviews legislation and files challenges in court.
“They’ve set up a system that is almost impossible to police,” Boyle says.
In the meantime, new tank cars were given thickness standards, which have proven to improve safety of crude oil transport — the Department of Transportation estimates a significant jump in puncture resistance for every one-eighteenth-inch increase in thickness. These standards apply to every oil tank car built after Oct. 1, 2015.
However, the same standards do not apply to the retrofitting of old tank cars that will stay on the rails. Old tank cars are allowed to be retrofitted to a thickness one-eighth of an inch less than new tank cars, and that is not the safest solution Boyle says.
“Each eighth of an inch adds a certain percentage of puncture resistance,” Boyle says. “The tank car industry didn’t want the new tank cars to be any bigger than a half an inch, so getting up to 9/16s was a fairly big win.
“One of the things that this argument shows is how willing the Department of Transportation was to bend over backwards, not to the interests of public safety but to tank car manufacturers.”
One key hitch in the regulations is that these tank car updates only apply to cars that are carried in a “high hazard flammable train,” what the Department of Transportation classifies as any train carrying a continuous block of 20 or more oil tank cars, or a train carrying 35 or more oil cars dispersed throughout the train. To be clear, these updates would not apply to a train carrying 19 consecutive tankers of Bakken crude oil, for instance.
That said, many oil trains have consecutive lines of tankers that exceed 100 tank cars, which is more efficient and economical for their business.
“Their argument is that, well, the accidents we’ve seen is on these big unit trains and that’s true, and those are of particular concerns, but you can easily imagine a scenario with a train with 19 cars in a row and have a derailment and still have a problem,” Boyle says.
Another issue the new regulations sought to address was the reduction of speed of trains carrying crude oil. Increased speed, as you might imagine, is one of the key factors to oil train derailments and explosions, as trains tip on steep curves or tank cars carrying volatile materials overheat, among other perils.
The regulations now say that only the high risk train cars must not exceed 50 mph in speed in most areas, and 40 mph in “high threat urban areas,” or areas where an explosion would cause catastrophic damage.
Longmont and the northern half of Boulder are not included in the Denver high threat urban area zone.
Boyle says the map wasn’t created specifically for the purpose of oil train safety.
“They just took the list of cities based on terrorist attacks, not lists of cities that have train cars rolling through them,” Boyle says.
Furthermore, recent rail accidents have occurred at an average of 30 mph, according to Earth Justice.
New regulations also require railroads to perform routing analyses on high hazard trains. These analyses are based on 27 safety points, including traffic density, past accidents, track grade and curvature, emergency response capability along the track and more. If a route decision is deemed unsafe by the Federal Railroad Administration, which must consult with several other federal agencies, it has the authority to force railroads to use a different route.
Some other objections to the new regulations include that they don’t apply to materials cultivated from tar sands, even though Canadian officials have included these materials on their safety updates. There is also the issue of implementing state-of-the-art braking systems, which can significantly reduce derailments and crashes, but which only has an initial deadline of 2023.
One interesting thing about railroads is that when the original regulations came out on May 1, the railroads were not required to notify communities when trains carrying crude oil were passing through, citing national security issues. That would mean all railroads had to do was supply a weekly rundown of how many trains passed through the area in a given week to local emergency personnel. This was the way the operation worked for years until President Obama issued an executive order last year, requiring companies transporting crude oil to notify local emergency personnel ahead of the train’s arrival. After receiving immediate backlash, the Department of Transportation reverted back to the president’s executive order, but Boyle says the railroad industry will seek to challenge this decision and go back to the post-notification system before the executive order.
Taken as a whole, these regulations are all slight improvements, and not major improvements, likely due to the fact that rail industries had a heavy hand in crafting these regulations.
Lobbying on the transport of crude oil increased 105 percent from the first quarter of 2014 to the first quarter of 2015, according to a report and study of records obtained by Bloomberg. These lobbying groups included Burlington Northern Santa Fe, CSX Corp. (a rail company), Shell, BP, the Association of American Railroads, the American Petroleum Institute and more.
There was always skepticism that the rail industry would have a hand in crafting its own legislation.
“The industry spent a lot of time and a lot of money lobbying the administration to make sure these rules were not too harsh on them,” Boyle says. “Now they’re allowed to do that, but it shows up when you have an agency that is responsible for public safety cutting corners on the final rules.”
Roxanne Butler, a spokeswoman for Burlington Northern Santa Fe, which ships trains carrying crude oil through Boulder County, says the company and others — spearheaded by the Association of American Railroads, she says — lobbied in Washington, “legally,” and wasn’t sure of how the lobbying efforts ultimately helped craft legislation.
“BNSF has advocated for a safer tank car in the movement of crude oil and finally setting a new federal standard will get the next generation tank car into service and substantially reduce the risk of a release in the event of an incident,” the company said in a statement. The statement also added that regulation changes “automatically take away capacity,” which “will have a devastating impact on our shippers and the economy.”
Boyle says there have been five challenges to the regulations from both sides of the issue, and that any changes or hearings, once the challenges are consolidated into one big court hearing, will not happen “any time soon.” She adds that the Department of Transportation is likely not to revise any of the regulations for at least 10 years, given the fact that’s what the current timeline calls for.
Now the one final thing to consider is the cost of all this implementation. BNSF’s Butler says the retrofitting and new car manufacturing costs will fall on the oil producers. But the rail industry will still incur plenty of costs from the regulations.
The Department of Transportation’s Regulatory Impact Analysis put all of these regulations into a cost-benefit analysis (It wasn’t, as you might imagine: Costs = lots of money; Benefits = a lot less death; but it wasn’t far off). The analysis was based on the costs of cleanups, payouts from loss of life and other expenses caused by derailments and explosions of specifically oil and ethanol-carrying trains, which reaches into the multi-billions of dollars. The study even predicted the amount of derailments in 2015 (that builds confidence, doesn’t it?), estimating 15 such accidents this year. If the costs are implemented as suggested in the study, it is expected that number will reduce down to five derailments by 2034.
For instance, it was found that $4.5 million invested into rail routing would reduce the risk of derailment by 1.7 percent, and thus be more cost effective than not rerouting rails and paying for the costs associated with a derailment.
Meanwhile, the study found reducing speed would be one of the greatest contributors to cost. If regulations reduced speed to 40 miles per hour in all areas, it would cost the industry about $2.6 billion over the next 20 years. However, the estimate that is closest to what was adopted in the regulations pins the bill at $22.9 million over 20 years.
Boyle says it’s important to keep these costs in context.
“Those numbers look large in the abstract, but they look very, very small when you look at the costs of explosions, spills and cleanups we’ve already seen and how much it takes to clean up an oil spill into a river and how much it takes to rebuild the center of Lac Mégantic, Quebec and you’re also talking about valuing human lives. There’s a cost-benefit analysis of lives in that,” Boyle says.
The cost study predicts increases in crude oil by rail transport over the next several decades, so we’ll see if (and hope that) these regulations begin to adequately address the danger such activity carries through Boulder County.
