WASHINGTON, Dec 5 (Reuters) – A rail safety proposal to upgrade thousands of tank cars would add billions of dollars in costs without guaranteeing a decrease in accidents, the U.S. ethanol industry said on Thursday.
As more flammable liquids such as ethanol and, increasingly, crude oil are carried on the tracks, regulators are considering tougher safety standards to prevent high-profile mishaps like a deadly incident in Canada over the summer and a 90-car crude train derailment in Alabama last month.
Corn ethanol, a fuel additive, is largely carried on rail tank cars to refiners who blend the product into gasoline.
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A proposal from rail operators to add safety components like heat shields to the fleet of roughly 29,000 ethanol rail cars would add weight, limit capacity and take many cars out of service for months at a time, the Renewable Fuels Association said in a letter to regulators on Thursday.
The cost of compliance could reach $2.6 billion just for the ethanol sector, and regulators would be wise to push for improvements in the tracks rather than rail cars if they want to prevent repeats of recent derailments, the trade association wrote.
“Rather than focusing exclusively on railcar design, a more prudent approach would be to invest in initiatives that address these root causes and keep the railcars on the tracks,” RFA President Bob Dineen wrote the Department of Transportation.
The ethanol industry’s effort to hold back costly rail safety standards is just another challenge for the sector. Last month, the Obama administration slashed the federal requirement for biofuel use in a continuing regulatory fight.
Officials will weigh comments from stakeholders in the rail sector before proposing new safety standards sometime next year.
So far the debate has pitted track owners advocating costly tank car upgrades against the industries that haul on those rail lines.
The American Association of Railways, the voice for track owners, has suggested that old tank cars get phased out and 78,000 cars go back into a workshop for costly upgrades.
Refitting a tank car could cost more than $90,000, the RFA estimates.
One improvement, wrapping the car in an additional thermal jacket, could cost $23,500 and take the car out of service for three months, according to one industry estimate.
Regulators have hastened to draft new rules in the wake of the deadly July derailment in the Quebec town of Lac-Megantic that killed 47 people.
The Canadian train was made up of DOT-111 tank cars that are the workhorse for carrying liquid fuels and which the U.S. National Transportation Safety Board has said were vulnerable to leaks and explosions in older models.
Comments on future safety standards are due to the DOT’s Pipeline and Hazardous Materials Safety Administration by the end of Thursday.
