We are closing out the “Path to Progress” series for this year with a potential bright spot. In its Fall 2014 Regulatory Agenda, the Obama Administration set a target date of March 2015 for finalizing new rules designed to prevent and minimize the consequences of derailments in trains carrying crude oil and other highly hazardous materials. If the Department of Transportation is able to accomplish that feat, it would beat even our own proposed schedule—a welcome achievement. We are looking forward to seeing that entry on our arrivals board turn over to “arrived.”
We’re looking forward to it because crude shipments by rail continue to expand, and millions of us are living in a blast zone.
As our 13 Essential Regulatory Actions explains, domestic crude production is booming (at least for now) because of this administration’s regulatory acquiescence to—and the oil industry’s unbridled advances in—fracking and horizontal drilling. In North Dakota and elsewhere, oil companies are simply sucking so much oil out of the ground that the producers are looking for any possible way to transport it to refineries. One of the non-conventional methods is to load the crude oil on trains. But because the shipments originate in shale formations that are far removed from refineries, the risks of derailment are significant.
Not at all surprisingly, both rail shipments and derailments of crude of have spiked. Shipments have gone from 9,500 rail-carloads in 2008 to 415,000 rail-carloads in 2013, a more than 4,000 percent jump. Likewise, more oil spilled from trains in 2013 than in the four previous decades combined. The worst such recent derailment was in July 2013, in a small Quebec town called Lac-Mégantic. More than 1 million gallons of crude spilled and ignited almost immediately, killing 47 people and forcing 2,000 more from their homes. A collision in North Dakota spilled 400,000 gallons of crude in December of that same year. The resulting fireball forced 1,400 people from their homes.
The administration’s proposed rules would not only reduce the risks of derailment by encouraging risk-based routing that takes into account the hazardousness of the cargo, track conditions, and other factors, but also reduce the consequences of derailment by encouraging the use of sturdier tank cars. The faster these requirements take effect, the better, so we were encouraged to see the accelerated schedule for finalizing the rules.
Of course, the date by which shipping and railroad companies must implement the new requirements is what really matters. Under the DOT’s proposal, which would grandfather in any tanker cars built before 2017, the industry has time to add 61,000 new tank cars to its fleet using the old and flimsy specifications. Not satisfied, shipping and oil companies are urging the DOT to extend the phase-in for another year. The cars have a useful life of many years, so it is critical that the DOT enact a rule that requires a quick phase-in.