• PRESS RELEASE
    July 2, 2008
  • Press Contact:
    Alan Anderson
    e-mail
  • Tanknology Inc.
    11000 N. MoPac Expy
    Suite 500
    Austin, TX 78759
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Enforcing The 2005 Energy Act

This lining has experienced severe de-lamination.

Operational compliance presents opportunities
for PEI members.

By Allen Porter

With the implementation of the Energy Policy Act of 2005 came an intensified focus on the federal regulations governing underground storage tank (UST) systems. In particular, the renewed emphasis is on providing teeth to the regulations in the form of inspections, violations and resulting penalties, in many cases prohibiting the delivery of fuel to tanks that are not in compliance.

Operational compliance has become a particularly hot topic across the country, as state and local regulators are receiving funds from the federal Environmental Protection Agency (EPA) to help bolster their compliance efforts.

When the federal UST regulations were first adopted in 1988, the EPA relied upon states to enforce the regulations. While some states, i.e., California, took up the issue with a vengeance, most simply did not have the funds to enact and enforce compliance programs on the scale the EPA envisioned. That is changing.

In 1986, Congress enacted the Leaking Underground Storage Tank (LUST) Trust Fund, which was to be used to oversee and enforce cleanups, including paying for cleanups at sites where responsible parties could not be identified or held accountable for damage caused by their leaking tanks. This fund was financed by a 0.1 percent federal tax on each gallon of motor fuel sold in the United States.

As of a year ago, the balance in the LUST Trust Fund exceeded $2.5 billion. The Energy Policy Act of 2005 expanded the definition of eligible uses of this money, with a particular emphasis on enforcement activities.

Opportunities

This intensified focus on UST system compliance is materializing in several ways this year. One of the most widespread issues is that of tank system inspections. Some of the major opportunities involving inspections include:

  • Tank Linings: One of the options for compliance with the federal regulations requiring corrosion protection on steel tanks was to line those tanks with an interior lining, or bladder. Those tanks that were lined in order to meet the 1998 compliance deadline must be visually re-inspected by the 10-year anniversary of their lining, then every five years thereafter.
  • Operational Compliance Inspections: The most recent UST regulations required that all tanks that had not been inspected since December 1998 had to be inspected by regulators by July 2007, and then again at least once every three years going forward. Many operators are realizing, the hard way, that an inspection by a regulator can be very costly if unknown issues are uncovered. Consequently, they are setting up pre-inspections by qualified third-party inspectors to help them understand and remedy any potential compliance problems before the regulator visits the site.
  • Start-up Inspections: Some state and local regulations are requiring more stringent testing of newly installed UST systems to ensure their integrity before the tanks are filled with fuel. When you think about it, this makes a lot of sense. An independent, third-party test of the system prior to start-up helps ensure that there is full system integrity from day one.

Records Verification

Related to inspections is the issue of records. A key component of the inspection of a UST site by a regulator is the verification that all applicable records and certifications are up-to-date and presentable. This includes such documents as:

  • Permit to Operate (PTO)
  • Release detection performance and maintenance plan, including printed monitoring results for the past year
  • The most recent tightness test
  • Copies of the performance claims of release detection manufacturers and records of system maintenance, repair and calibration of equipment
  • Records showing required inspections and tests of the corrosion protection system
  • Records showing that a repaired or upgraded UST system was handled properly
  • Documents demonstrating required financial responsibility.

Few sites are able to comply with all of the records requirements. A review by a qualified expert almost always turns out to be time and money well spent, as infractions become costly very quickly.

Equipment Upgrade and Replacement

When the federal EPA regulations took effect in 1988, there was an overabundance of equipment manufacturers selling UST operators a better way to monitor their UST systems. A large percentage of those companies have since gone out of business or stopped selling leak detection systems, making availability of parts and service nearly impossible.

In other cases, equipment was installed in order to meet the regulations, but has not been properly serviced and maintained in the ensuing years. Leak detection equipment upgrades, service and system replacement offer a tremendous opportunity for the distribution marketplace in 2008 and beyond, as the renewed emphasis on regulatory compliance brings to light many old systems that are either not functioning, or cannot be certified as functioning consistent with the regulations.

Opportunities in this Market

The myriad laws and regulations can be daunting for even the most sophisticated of operators, which is evidenced by the high number of violations and notices of non-compliance issued to them each year.

The year 2008 is expected to be a year filled with UST site inspections all across the country. A significant number of the sites inspected will be in violation of the regulations, which will cost operators money through fines and lost revenue. The business opportunity for the PEI member is to get in front of that potential problem, by helping their customers ensure that they’re truly prepared for their inspections and are, in fact, in complete compliance with all the necessary regulations.

Allen Porter is president and chief executive officer of Tanknology Inc., headquartered in Austin, Texas, and on the Web at www.tanknology.com.

This article may be viewed at:
http://www.thepeijournal.org/content/2q08/sf-enforceenergyact.php