July 2023 Vol. 78 No. 7
Washington Watch
New leak detection rules for pipelines proposed
Stephen Barlas | Washington, D.C. Editor
(UI) — The federal Pipeline and Hazardous Materials Safety Administration (PHMSA) has proposed major changes to its leak detection based not on concerns about safety but, rather, in order to reduce methane emissions related to their contribution to climate change. The move to comply with a provision in 2020 Protecting our Infrastructure of Pipelines and Enhancing Safety (PIPES) Act broadens the agency’s mission to environmental concerns which may turn out, Congressional authorization aside, to be a very controversial move.
Part of PHMSA’s rationale for this proposed rule, other than injecting environmental concerns into the agency’s mandate, is the belief that although the pipeline industry has made some headway with voluntary industry efforts to reduce methane leaks: “those efforts generally exhibit shortcomings (including meager participation, limited application to different pipeline facilities, absence of meaningful leak reduction targets, or a lack of transparency, limited application to natural gas pipelines), underscoring the need for timely federal regulatory intervention.”
“The proposed rule’s preamble creates the impression pipes are leaking left and right,” stated Emily Mallen, an attorney at Akin Gump in Washington, who has been fielding concerned phone calls from transmission pipeline clients. “Industry will not be happy with that characterization.
“Pipelines have been able to say we are safe. The industry is proud of its safety record. If they start getting dinged by PHMSA for leaks based on environmental protection principles, it could give the impression that their systems are not safe. That won’t sit well with the industry.”
Section 118 of the PIPES Act gives PHMSA new authority to force companies to plug both “fugitive emissions” and “vented emissions” from over 2.7 million miles of gas transmission, distribution and gathering pipelines, and other gas pipeline facilities, as well as 403 underground natural gas storage facilities and 165 liquefied natural gas (LNG) facilities. According to PHMSA, these will help in “improving public safety, promoting environmental justice and addressing the climate crisis.”
“I do think PHMSA has some ground to consider environmental impacts of leaks,” Mallen explained. “But what concerns me is that this rule goes too far. The proposed rule focuses a lot on climate. By emphasizing so much on climate, pipeline safety may become less of a bipartisan issue and may result in PHMSA being further politicized.”
Investigation
Key Republicans in the House are already investigating the May 5, 2023, leak detection proposal among other PHMSA regulatory efforts. On May 9, House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-Wash.) and Subcommittee on Energy, Climate and Grid Security Chair Jeff Duncan (R-S.C.) sent a letter to Tristan Brown, acting administrator at PHMSA, asking a number of questions about different issues.
One item in that letter asked, regarding the leak detection proposal, whether PHMSA is required to conduct a risk assessment and cost-benefit analysis, so all new regulations are cost-effective. That query added:
“Has PHMSA estimated the compliance costs of the proposed regulation? How much does PHMSA expect the proposed regulation will increase the price of natural gas for American consumers? How does PHMSA estimate environmental costs and benefits? Does PHMSA estimate environmental costs and benefits related to climate change that are incurred outside the United States for use in agency rulemakings?
“Does PHMSA utilize the Social Cost of Carbon, the Social Cost of Methane, or other tools or models to estimate environmental costs related to climate change? How does PHMSA define ‘equity benefits,’ a term used in the May 5, 2023, proposal? Please describe PHMSA’s statutory authority and methodology for estimating ‘equity benefits’ for use in agency rulemaking.”
PHMSA’s current rules are narrowly focused on public safety risks associated with ignition of large-volume, instantaneous releases and accumulated gas; they are unclear regarding when, if at all, most leaks must be repaired.
Small methane leaks do not have to be repaired. Some pipelines do have to promptly repair “hazardous leaks,” but that term is not defined in terms of risks to the environment. Current regulations tolerate significant intentional emissions of methane and other gases, even in non-emergency situations, by allowing venting, blowdowns and other large-volume releases of gas.
The proposed rule establishes an Advanced Leak Detection Program (ALDP) performance standard that would require operators to:
- Grade and repair all leaks (except those from compressor stations) and not merely those that pose public safety risk.
- Establish minimum criteria for leak grades and associated repair schedules prioritized by safety and environmental hazard.
- Reduce intentional sources of methane emissions by minimizing releases associated with blowdowns.
- Incorporate explicit reference to environmental harm among the “hazards” addressed in certain sections of the pipeline safety regulations.
- Meet other new requirements.
PHMSA proposes an effective date for this rulemaking of six months following publication of a final rule in the Federal Register.
Leaks
Leak detection equipment must have a minimum sensitivity of five parts per million (ppm) or less. Operators would select their leak detection equipment based on a documented analysis that considers the gas transported, the size, configuration, operating parameters, and operating environment of the system. An operator may seek PHMSA review of alternative leak detection technology.
Repair requirements would be based on how dangerous a leak was – from Grade 1, the most serious, to Grade 3. Grade 1 leaks present an urgent or emergency situation, requiring the operator to take “immediate and continuous” action to eliminate the hazards to people or the environment.
NPRM classifies the following as a Grade 1 leak: “Any reading of 80 percent lower explosive limit (LEL) or higher in a substructure from which gas would likely migrate to the outside wall of a building; any leak that can be seen, heard or felt; and any leak reportable as an incident under Part 191 of the pipeline safety regulations.”
PHMSA estimates a total of 11 new requirements would result in reducing unintentional methane emissions approximately 72 percent from regulated gathering pipelines, 17 percent from transmission pipelines, and 44 to 62 percent from distribution pipelines. Also, PHMSA estimates total avoided blowdown emissions, under the proposed rule, correspond to approximately 43 percent of baseline blowdown emissions. PHMSA further estimates that the proposed rule would result in monetized net benefits between $341 to $1,440 million per year.
According to Susan Olenchuk, a partner at Van Ness Feldman, “Whether PHMSA has accurately estimated the costs and benefits of the proposed rule will certainly be a significant issue that industry will raise in their comments. Also, the elevation of environmental protection to be on par with safety will likely be an issue.
“In that regard, PHMSA has recently encountered criticism from certain members of Congress for transforming the Pipeline Safety Act into an environmental statute, instead of a safety statute.”
A spokeswoman for the Interstate Natural Gas Association of America said “As this was mandated in the PIPES Act of 2020 we anticipated, and appreciate, this rulemaking. We cannot comment on the specifics of this proposed rule until we have had more time to review it, and we look forward to working with PHMSA to ensure that the mandate can be implemented appropriately to ensure the safe and efficient delivery of natural gas through our infrastructure.”
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