The Pipeline and Hazardous Materials Safety Administration (PHMSA) issued an extensive, 549-page Notice of Proposed Rulemaking on March 17, 2016, that would significantly broaden the agency's regulatory scope with respect to gas pipelines. The proposed rule follows on the heels of S. 2276, the Securing America's Future Energy: Protecting our Infrastructure of Pipelines and Enhancing Safety Act (the SAFE PIPES Act). Passed by the U.S. Senate this month, the SAFE PIPES Act puts pressure on PHMSA to complete delayed Congressional pipeline safety mandates.
The impetus for the rulemaking was the 2010 pipeline incident in San Bruno, Calif., which killed eight people and injured more than 50, while destroying 38 homes. An Advanced Notice of Proposed Rulemaking (ANPRM) followed in 2011, along with National Transportation Safety Board (NTSB) recommendations, statutory requirements via the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, and a Government Accountability Office (GAO) recommendation, all of which factored into the proposed rule. However, some of the issues raised by Congress and the administration – and emphasized in the SAFE PIPES Act – were left out of the proposed rule. Notably, automatic or remote-controlled shut-off valves were omitted, with PHMSA stating that it will address this and other issued in a separate rulemaking.
One of the most substantial changes proposed by PHMSA is the creation of a new category: Moderate Consequence Areas (MCAs), which would require integrity assessments and safety protections in each "onshore area that is within a potential impact circle ... containing five (5) or more buildings intended for human occupancy, an occupied site, or a right-of-way for a designated interstate, freeway, expressway, and other principal 4-lane arterial roadway." The agency elected to create the MCA category rather than expand the definition of High Consequence Areas (HCAs). Another substantial proposed change is to require that pipelines that were constructed before 1970 be pressure tested. Those pipelines, which were already in place when the applicable regulation went into effect, have thus far been grandfathered and escaped PHMSA-mandated testing.
As reported, Congress has started to take action on many of the same issues. (See Holland & Knight Alert, "Senate Passes Reauthorization Bill for PHMSA," March 8, 2016.) The House Energy and Commerce Committee recently introduced similar legislation to reauthorize the PHMSA, and the House Transportation and Infrastructure Committee plans to introduce its reauthorization draft later this spring.
The House bills could address major problems that industry members might have with PHMSA's NPRM, which could lead industry members to advocate changes if they think PHMSA's rule is too burdensome. Interested stakeholders should provide key Congressional policymakers and staff with suggested changes without delay.
Other notable regulatory changes proposed by PHMSA include:
Comments will be due within 60 days of publication in the Federal Register, which has not yet occurred.
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