Pipeline Regulations
Federal Pipeline Safety Regulations
The Natural Gas Pipeline Safety Act (NGPSA) of 1968 and the Hazardous Liquid Pipeline Act (HLPSA) of 1979 are two of the key early acts establishing the federal role in pipeline safety. Under both statutes, the Transportation Secretary is given primary authority to regulate key aspects of interstate pipeline safety. The Natural Gas Pipeline Safety Act authorizes the Department of Transportation (DOT) to regulate pipeline transportation of natural (flammable, toxic, or corrosive) gas and other gases as well as the transportation and storage of liquefied natural gas (LNG). Similarly, the Hazardous Liquid Pipeline Safety Act authorizes the DOT to regulate pipeline transportation of hazardous liquids including crude oil, petroleum products, anhydrous ammonia, and carbon dioxide.
Both of these acts have been recodified in Title 49 of the Code of Federal Regulations, sections 60601-60301. Below is a general overview of what each section of Title 49 pertains to.
The Department of Transportation administers pipeline regulations through the Office of Pipeline Safety (OPS) within the Pipelines and Hazardous Materials Safety Administration (PHMSA). PHMSA enforces two general set of pipeline safety requirements. The first are minimum safety standards that cover specifications for the design, construction, testing, inspection, operation, and maintenance of pipelines. The second are part of an additional risk-based program called “integrity management.” The Integrity Management Program (IMP) is a federal rule that specifies how pipeline operators must identify, prioritize, assess, evaluate, repair and validate the integrity of hazardous liquid pipelines that could, in the event of a leak or failure, affect High Consequence Areas (HCAs) within the United States. For natural gas pipelines, HCAs are determined by population density and for hazardous liquid lines, HCAs are determined by population density as well as unusually sensitive areas, such as drinking water sources or commercially navigable waterways. PHMSA is also responsible for reviewing oil spill response plans for onshore oil pipelines.
PHMSA's primary roles and responsibilities include:
Pipeline Safety Regulations address:
Congressional funding for PHMSA must be reviewed and renewed every four years, which typically results in some legislative amendments as part of reauthorization. The last pipeline safety reauthorization, “Securing America’s Future Energy: Protecting Our Infrastructure of Pipelines and Enhancing Safety Act” (“SAFE PIPES Act”) was signed into law in June of 2016. The SAFE PIPES Act reauthorizes PHMSA from fiscal year 2016 – 2019. The SAFE PIPES Act sets out new directives and mandates for PHMSA which aim to improve safety by closing gaps in existing federal standards.
New provisions include:
The bill also reinforces the 16 outstanding Congressional mandates from the 2011 reauthorization bill (the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011). The Act requires PHMSA to submit updates to Congress every 90 days on the status of outstanding statutory mandates, detailing the reason for its incompletion and estimated completion date.
The full text of the SAFE PIPES Act is available here.
While PHMSA has primary authority over pipeline safety, PHMSA has no authority to approve pipeline projects, issue permits, or prescribe the location or routing of pipelines.
The Federal Energy Regulatory Commission (FERC) has exclusive authority to regulate the siting of interstate (between state) natural gas pipelines. FERC reviews applications for the construction and operation of natural gas pipelines as well as proposals to build liquefied natural gas (LNG) terminals and hydropower projects.
FERC’s natural gas responsibilities include regulation of:
No federal agency regulates the siting of Hazardous Liquid pipelines. Siting rests with individual states through which the lines will operate and is governed by state law.
State Regulations
The pipeline safety statute allows for states to assume all or part of the responsibility over the safety of gas and hazardous liquid pipelines. All states, except Alaska and Hawaii participate in the state pipeline safety program to some degree.
The law allow for state assumption of intrastate (within the state) regulatory, inspection, and enforcement responsibilities through an annual certification or agreement. To qualify, a state must adopt the minimum federal regulations and may adopt additional or more stringent regulations as long as they are not incompatible with federal law. States are also allowed to inspect and regulate interstate (between state) lines, but they are not allowed to conduct enforcement for interstate pipelines. Federal funding is available for states who take on more responsibility for pipelines; up to 80% of the costs of a state’s pipeline safety program can be reimbursed.
In Michigan, the federal government has full authority over pipeline safety for hazardous liquid pipelines. PHMSA inspects and enforces pipeline safety regulations for interstate and intrastate hazardous liquid pipelines in Michigan.
The State does have responsibility over natural gas pipelines in Michigan. The Michigan Public Service Commission (MPSC) inspects and enforces pipeline regulations for intrastate gas pipelines. The MPSC also inspects interstate gas pipelines in Michigan, but PHMSA enforces pipeline safety regulations for interstate gas pipelines based on the inspections performed by the State. In addition, MPSC is responsible for approving construction, including siting and routing, of new petroleum pipelines in Michigan.
Local governments have almost no direct role in overseeing pipeline operations, with the exception of permit coordination when construction or maintenance is done.
Other Regulations
Oil Pollution Act of 1990 (40 CFR Part 112)
The Oil Pollution Act (OPA) of 1990, which was enacted as a result of the Exxon Valdez oil spill in Prince William Sound, Alaska, addresses oil spill liability, cleanup, and compensation. This regulation was designed to ensure that oil facility personnel are adequately prepared to respond if a spill occurs. The OPA mandates the establishment of Area Contingency Plans and is intended to set forth procedures to mitigate or prevent a worst-case discharge or the substantial threat of a worst-case discharge.
Additionally, OPA authorized the Oil Spill Liability Trust Fund (OSTFL). The OSLTF provides an immediate source of federal funding to respond to oil spills in a timely manner. The funds in the OSLTF come primarily from an 8 cent per-barrel tax on domestic and imported crude oil and petroleum products. The trust fund has two primary components:
Oil-sands derived crude oils are not subject to the OSLTF excise tax. The IRS made this conclusion based upon a 1980 House committee report which stated “the term crude oil does not include synthetic petroleum, e.g. shale oil, liquids from coal, tar sands, or biomass, or refined oil.” Several members of Congress have proposed legislation recently that would specifically include oil sands-derived crude oil within the scope of the per-barrel tax.
Hazardous Waste Operations and Emergency Response (29 CFR 1910.120)
Also known as “HAZWOPER,” this regulation established requirements for the pipeline industry and public safety organizations that respond to hazardous waste emergencies.
Community Emergency Planning Regulations (40 CFR 301-303)
This mandates the establishment of both state planning groups and local emergency planning committees (LEPC). The LEPC is responsible for developing and coordinating local emergency response.
National Contingency Plan (40 CFR 300, Subchapters A through J)
This regulation outlines the policies and procedures of the National Oil and Hazardous Materials Response Team.
Agencies Involved in Pipeline Operations
Federal
State of Michigan
The Natural Gas Pipeline Safety Act (NGPSA) of 1968 and the Hazardous Liquid Pipeline Act (HLPSA) of 1979 are two of the key early acts establishing the federal role in pipeline safety. Under both statutes, the Transportation Secretary is given primary authority to regulate key aspects of interstate pipeline safety. The Natural Gas Pipeline Safety Act authorizes the Department of Transportation (DOT) to regulate pipeline transportation of natural (flammable, toxic, or corrosive) gas and other gases as well as the transportation and storage of liquefied natural gas (LNG). Similarly, the Hazardous Liquid Pipeline Safety Act authorizes the DOT to regulate pipeline transportation of hazardous liquids including crude oil, petroleum products, anhydrous ammonia, and carbon dioxide.
Both of these acts have been recodified in Title 49 of the Code of Federal Regulations, sections 60601-60301. Below is a general overview of what each section of Title 49 pertains to.
- Part 190 – Pipeline Safety Programs/Rulemaking
- Part 191 –Reporting Requirements
- Part 192 – Natural Gas Pipelines – this part outlines the minimum safety requirements for gas pipelines including:
- Design and Construction of Pipeline Components
- Operations, Maintenance, and Emergency Procedures
- Corrosion Control
- Pipeline Integrity Management
- Damage Prevention and Public Education
- Qualification of Personnel
- Recordkeeping and Reporting - Part 193 –Liquefied Natural Gas Facilities
- Part 194 – Response Plans for Onshore Oil Pipelines
- Part 195 – Hazardous Liquid Pipelines - this part outlines the minimum safety requirements for hazardous liquid pipelines including:
- Pipeline Design, Construction, and Welding Considerations
- Transportation in Pipelines Constructed with Non-steel Materials
- Pressure Relief Devices – Design and Installation
- Corrosion, Operations, Maintenance, and Emergency Procedures
- Pipeline Integrity Management in High Consequence Areas - Part 198 – Grants to Aid State Pipeline Safety Programs
- Part 199 – Drug and Alcohol Testing
The Department of Transportation administers pipeline regulations through the Office of Pipeline Safety (OPS) within the Pipelines and Hazardous Materials Safety Administration (PHMSA). PHMSA enforces two general set of pipeline safety requirements. The first are minimum safety standards that cover specifications for the design, construction, testing, inspection, operation, and maintenance of pipelines. The second are part of an additional risk-based program called “integrity management.” The Integrity Management Program (IMP) is a federal rule that specifies how pipeline operators must identify, prioritize, assess, evaluate, repair and validate the integrity of hazardous liquid pipelines that could, in the event of a leak or failure, affect High Consequence Areas (HCAs) within the United States. For natural gas pipelines, HCAs are determined by population density and for hazardous liquid lines, HCAs are determined by population density as well as unusually sensitive areas, such as drinking water sources or commercially navigable waterways. PHMSA is also responsible for reviewing oil spill response plans for onshore oil pipelines.
PHMSA's primary roles and responsibilities include:
- Development and Implementation of Safety Regulations
- Perform Comprehensive Inspections
- Monitor and Enforce Compliance
Pipeline Safety Regulations address:
- Materials
- Design
- Construction
- Operations and Maintenance
- Emergency Preparedness Plans
- Public Awareness Programs
- Damage Prevention Programs - Personnel Qualification, Drug and Alcohol Programs
- Integrity Management Program
Congressional funding for PHMSA must be reviewed and renewed every four years, which typically results in some legislative amendments as part of reauthorization. The last pipeline safety reauthorization, “Securing America’s Future Energy: Protecting Our Infrastructure of Pipelines and Enhancing Safety Act” (“SAFE PIPES Act”) was signed into law in June of 2016. The SAFE PIPES Act reauthorizes PHMSA from fiscal year 2016 – 2019. The SAFE PIPES Act sets out new directives and mandates for PHMSA which aim to improve safety by closing gaps in existing federal standards.
New provisions include:
- Requiring PHMSA to set federal minimum safety standards for underground natural gas storage facilities, while allowing states to go above those standards for intrastate requirements
- Authorizing emergency order authority should a pipeline pose an imminent hazard to the environment or public health and safety
- Updating regulations for certain liquefied natural gas facilities to reflect changing technology and markets
- Increasing inspection requirements for certain underwater oil pipelines, particularly Enbridge’s Line 5 located in the Straits of Mackinac
- Designating the Great Lakes as an unusually sensitive area
- Creating a working group of PHMSA, states, industry stakeholders, and safety groups to develop recommendations on how to create an information sharing system to improve safety outcomes
- Requesting studies on the effectiveness of integrity management programs
- Authorizing PHMSA to study the feasibility of a national integrated pipeline safety database to have a clearer picture of federal and state safety oversight efforts
- Authorizing states to participate in interstate pipeline inspections
The bill also reinforces the 16 outstanding Congressional mandates from the 2011 reauthorization bill (the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011). The Act requires PHMSA to submit updates to Congress every 90 days on the status of outstanding statutory mandates, detailing the reason for its incompletion and estimated completion date.
The full text of the SAFE PIPES Act is available here.
While PHMSA has primary authority over pipeline safety, PHMSA has no authority to approve pipeline projects, issue permits, or prescribe the location or routing of pipelines.
The Federal Energy Regulatory Commission (FERC) has exclusive authority to regulate the siting of interstate (between state) natural gas pipelines. FERC reviews applications for the construction and operation of natural gas pipelines as well as proposals to build liquefied natural gas (LNG) terminals and hydropower projects.
FERC’s natural gas responsibilities include regulation of:
- Pipeline, storage, and liquefied natural gas facility construction
- Interstate transportation of natural gas
- Facility abandonment
- Oversees the construction and operation of pipeline facilities at United States points of entry for the import or export of natural gas
- Issues certificates of public convenience and necessity to prospective companies providing energy services or constructing and operating interstate pipelines and storage facilities
- Establishes rates for services
No federal agency regulates the siting of Hazardous Liquid pipelines. Siting rests with individual states through which the lines will operate and is governed by state law.
State Regulations
The pipeline safety statute allows for states to assume all or part of the responsibility over the safety of gas and hazardous liquid pipelines. All states, except Alaska and Hawaii participate in the state pipeline safety program to some degree.
The law allow for state assumption of intrastate (within the state) regulatory, inspection, and enforcement responsibilities through an annual certification or agreement. To qualify, a state must adopt the minimum federal regulations and may adopt additional or more stringent regulations as long as they are not incompatible with federal law. States are also allowed to inspect and regulate interstate (between state) lines, but they are not allowed to conduct enforcement for interstate pipelines. Federal funding is available for states who take on more responsibility for pipelines; up to 80% of the costs of a state’s pipeline safety program can be reimbursed.
In Michigan, the federal government has full authority over pipeline safety for hazardous liquid pipelines. PHMSA inspects and enforces pipeline safety regulations for interstate and intrastate hazardous liquid pipelines in Michigan.
The State does have responsibility over natural gas pipelines in Michigan. The Michigan Public Service Commission (MPSC) inspects and enforces pipeline regulations for intrastate gas pipelines. The MPSC also inspects interstate gas pipelines in Michigan, but PHMSA enforces pipeline safety regulations for interstate gas pipelines based on the inspections performed by the State. In addition, MPSC is responsible for approving construction, including siting and routing, of new petroleum pipelines in Michigan.
Local governments have almost no direct role in overseeing pipeline operations, with the exception of permit coordination when construction or maintenance is done.
Other Regulations
Oil Pollution Act of 1990 (40 CFR Part 112)
The Oil Pollution Act (OPA) of 1990, which was enacted as a result of the Exxon Valdez oil spill in Prince William Sound, Alaska, addresses oil spill liability, cleanup, and compensation. This regulation was designed to ensure that oil facility personnel are adequately prepared to respond if a spill occurs. The OPA mandates the establishment of Area Contingency Plans and is intended to set forth procedures to mitigate or prevent a worst-case discharge or the substantial threat of a worst-case discharge.
Additionally, OPA authorized the Oil Spill Liability Trust Fund (OSTFL). The OSLTF provides an immediate source of federal funding to respond to oil spills in a timely manner. The funds in the OSLTF come primarily from an 8 cent per-barrel tax on domestic and imported crude oil and petroleum products. The trust fund has two primary components:
- Emergency Fund - available for Federal On-Scene Coordinators (FOSCs) to respond to discharges and for federal trustees to initiate natural resource damage assessments. The Emergency Fund is a recurring $50 million available annually.
- Remaining Principal Fund – this balance is used to pay claims and to fund appropriations by Congress to Federal agencies to administer the provisions of OPA and support research and development.
Oil-sands derived crude oils are not subject to the OSLTF excise tax. The IRS made this conclusion based upon a 1980 House committee report which stated “the term crude oil does not include synthetic petroleum, e.g. shale oil, liquids from coal, tar sands, or biomass, or refined oil.” Several members of Congress have proposed legislation recently that would specifically include oil sands-derived crude oil within the scope of the per-barrel tax.
Hazardous Waste Operations and Emergency Response (29 CFR 1910.120)
Also known as “HAZWOPER,” this regulation established requirements for the pipeline industry and public safety organizations that respond to hazardous waste emergencies.
Community Emergency Planning Regulations (40 CFR 301-303)
This mandates the establishment of both state planning groups and local emergency planning committees (LEPC). The LEPC is responsible for developing and coordinating local emergency response.
National Contingency Plan (40 CFR 300, Subchapters A through J)
This regulation outlines the policies and procedures of the National Oil and Hazardous Materials Response Team.
Agencies Involved in Pipeline Operations
Federal
- Agency for Toxic Substances and Disease Registry (ATSDR) –federal agency responsible for evaluating human health exposures to hazardous substances in emergencies, identifying potential exposures, assessing associated health effects, and providing actions to stop, prevent, or minimize these harmful effects
- Bureau of Land Management/Forest Service (BLM/USFS) – responsible for easements on certain federal public lands
- Department of State (DOS) – responsible for approving pipelines that cross international borders
- Environmental Protection Agency (EPA) – responsible for oil spill contingency planning to provide a blueprint for responding to oil spills and the lead federal response agency for oil spills occurring in inland navigable waters
- Federal Energy Regulatory Commission (FERC) – responsible for approving tariffs (costs of using pipeline) and siting of interstate natural gas pipelines
- National Transportation and Safety Board (NTSB) – responsible for investigating accidents occurring during the transport of natural gas or hazardous liquids through pipeline systems
- Occupational Safety and Health Administration (OSHA) – responsible for worker safety as it relates to pipelines
- Pipeline and Hazardous Material Safety Administration (PHMSA)– responsible for developing and enforcing pipeline safety regulations
- Transportation Security Administration (TSA) - responsible for enhancing the security preparedness of the nation's hazardous liquid and natural gas pipeline systems
- U.S. Army Corps of Engineers (USACE) – responsible for permitting of pipeline work in the Great Lakes and connecting channels
- U.S. Coast Guard (USCG) – maintains the Northern Michigan Area Contingency Plan which outlines the plans for the containment, cleanup, and disposal of oil and hazardous substance discharges and releases in Northern Michigan and is the lead federal response agency for spills in coastal waters and deep water ports, including the Great Lakes and connecting channels
- U.S. Fish and Wildlife Service (USFWS) – provides technical assistance to minimize oil spill response impacts to wildlife, specifically public trust resources such as land, fish, wildlife, biota, air, and surface, ground and drinking water, and is responsible for collecting and analyzing impacts to natural resources as part of a Natural Resource Damage Assessment (NRDA)
- U.S. Geological Survey - gathers scientific data and information on the environmental impacts of an oil spill to affected coastal habitats
State of Michigan
- Michigan Department of Community Health (MDCH) – state agency responsible for protecting public health through water and air monitoring, and evaluation of human health risks associated with oil spills
- Michigan Department of Environmental Quality (MDEQ) – responsible for permitting of pipeline work in inland lakes, streams, wetlands, and the Great Lakes and responds to releases of oil or hazardous substances in Michigan’s waters
- Michigan Department of Natural Resources (MDNR) – assists with the collection and rehabilitation of oiled and injured wildlife and works to minimize harm to state threatened and endangered species, migratory birds, freshwater fish, and their supporting habitat
- Michigan Public Service Commission (MPSC) – responsible for approving construction, including siting and routing, of new petroleum pipelines in Michigan
