Oil by rail transport regulations need improving – industry, critics

Oil by rail transport growing rapidly in United States, Canada

Finally. The American and Canadian governments announced Friday a new set of safer oil by rail transport regulations, but critics say updated rules aren’t perfect.

oil by rail transport

Jack Gerard, president and CEO of the American Petroleum Institute. Photo: Handout.

The two governments worked jointly on the changes because the rail industries in both countries are tightly integrated.

Summary of the new oil by rail transport regulations:

  • New tank cars carrying crude oil and ethanol must have an outer shell, a thermal lining to withstand fire, improved valves and thicker, 9/16ths-inch steel walls to keep them from rupturing.
  • 16,000-plus of the oldest tank cars, known as DOT-111s, have to be phased out or retrofitted by 2018. By 2020, an additional 27,000 cars primarily used for crude would need to be upgraded.
  • Trains of at least 70 cars that have at least one car containing the most volatile class of liquids also must have electronically controlled brakes that automatically stop all the cars in a train at the same time, instead of sequentially. The braking requirement goes into effect on Jan. 1, 2021.

It didn’t take long for critics on both sides of the issue to begin pointing out issues.

The American Petroleum Institute takes issue with the electronic braking systems, which it says are too expensive and will add to the length of time required to retrofit tanker cars.

“The safety impact of ECP brakes is marginal at best,” said API President and CEO Jack Gerard.. “It is concerning that regulators did not select one of several alternative braking technologies that have much clearer benefits for safety.”

oil by rail transport

Oil tankers will have to be upgrading, including expensive electric brake systems.

Railways say the the Transportation Department “couldn’t make a case” for electronic brakes but forged ahead anyway. By 2021 if a single car lacks the new brakes, the train will be forced to travel at 30 mph, which railways say could back up the entire system.

“This is an imprudent decision made without supporting data or analysis,” said Edward R. Hamberger, the Association of American Railroads’ CEO.

Industry has already indicated it doesn’t have the shop capacity to finish the upgrades within the mandated timeframes.

“The railcar manufacturing industry’s own calculations show it does not have the shop capacity to meet the retrofit timeline announced today, which will lead to shortages that impact consumers and the broader economy,” said Gerard.

The braking requirement applies only to the U.S.  Transportation Minister Lisa Raitt said Canadian regulators are moving on a separate, faster track to adopt a new braking standard. No details have been released about the new standards.

oil by rail transport

US Senator Chuck Schumer (D-NY).

US Senator Chuck Schumer (D-N.Y.) didn’t wait long to propose changes to the regulations. On Monday he announced legislation to “fix holes in the oil-by-rail rule.” Schumer’s bill includes phasing out Dot 111 tank cars in two years instead of eight, enforce speed limits in a county with a population density greater than 20 people per sq. mile, require the USDOT to formulate the first-ever federal standard on volatility in order to reduce the instability of flammable oil, and a requirement that following the derailment of any High Hazard Flammable Train (HHFT) comprised of more than 10 loaded tank cars carrying volatile crude oil that critical information be made immediately available to the Federal Railroad Administration and to local emergency responders.

“Allowing these outdated oil cars to continue rolling through our communities for another eight years is a reckless gamble that we can’t afford to make. That is why I am introducing legislation that would fix these obvious shortcomings,” said Schumer.

“While the DOT’s announcement has finally forced the industry’s hands to update these rules, there is no question that the new rules don’t go far enough.”

Pushback from both industry and legislators is probably a good sign the new regulations accomplished a difficult balancing act: pushing for change, but at a pace that car-builders and railways could keep up with.

“I think a lot of thought’s gone into this on both sides of the border,” said Freight Management Association of Canada president Bob Ballantyne. “It’s probably about as good as could be expected.”

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