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.
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:
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:
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.
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