March 5, 2020

PHMSA Considering Recommendations for Transport of LNG By Rail

Holland & Knight Energy and Natural Resources Blog
Dianne R. Phillips
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According to a recent filing,1 the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA) is considering recommendations to increase the outer tank shell for the DOT-113 tank car in response to comments2 filed by the National Transportation Safety Board, among others. As regular readers know, I have been writing3 about transportation of liquefied natural gas (LNG) by rail ever since the idea surfaced two years ago as a way to improve winter natural gas constraints in New England. First was the news4 that PHMSA responded to the Petition for Rulemaking filed by the Association of American Railroads (AAR). Then, the matter5 appeared in the Fall 2018 Unified Regulatory Agenda, but, as reported,6 the topic didn't really gain traction until President Donald Trump issued his April 2019 Executive Order on Promoting Energy Infrastructure and Economic Growth.7 Thereafter, PHMSA was hard at work, first8 in connection with a Special Permit request, and more recently9 with its request for comment on a proposed rulemaking, which would change the regulations to allow transportation of LNG by rail in the same manner, essentially, as other hazardous cryogenic liquids (which are already authorized to travel by rail). Rail transportation was viewed by the industry as a favorable alternative to trucking LNG, which reportedly is less fuel efficient and generates higher harmful emissions as calculated by the U.S. Department of Transportation Freight Routing and Emissions Analysis Tool (FREAT) according to the Final Environmental Assessment.10

To support the regulatory changes, PHMSA analyzed data regarding DOT-113 safety incidents (damage) and found that the vast majority of incidents causing damage to the DOT-113s did not result in a loss of hazardous materials. In addition, PHMSA conducted an analysis of potential failure scenarios, including a cascading failure of multiple DOT-113 tank cars and a potential boiling liquid expanding vapor explosion (BLEVE). This analysis included evaluation of radiant heat exposure, cryogenic temperature exposure and flammable vapor cloud scenarios. PHMSA concluded that from an overall risk to the public perspective, rail transportation is still the safest and preferred option considering the quantity and distance transported. These analyses are described in the Notice of Proposed Rulemaking11 and published in a Preliminary Regulatory Impact Analysis.12

Despite support13 from the AAR and the American Short Line and Regional Railroad Association, the attorneys general from 15 states and the District of Columbia filed comments14 opposing the proposal claiming PHMSA failed to adequately consider the "greater risk of catastrophic accidents" as well as the "environmental and climate impacts of allowing LNG to be shipped in rail tank cars." The National Transportation Safety Board also weighed in with comments15 urging PHMSA to adopt sufficient "operational controls," similar to those imposed in special permits issued by PHMSA, and require additional data on the safety of the proposed DOT-113 tank cars prior to proceeding. Additionally, according to notes16 from the PHMSA meeting, the Tank Car Committee for the AAR has convened a task force that is considering alternatives to improve the performance of the DOT-113 tank car. Only time will tell if those efforts will succeed in convincing the opponents.


1 Notes from the Meeting with PHMSA Executives and Florida East Coast Industries

2 Comment from National Transportation Safety Board

3 Is LNG by Rail Coming to New England?, March 13, 2018

4 Transporting LNG by Rail is One Step Closer, May 15, 2018

5 Transporting LNG by Rail is One Step Closer, May 15, 2018

6 President Trump Jumpstarts LNG Development and Transportation, April 12, 2019

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