The debate over whether the US federal government should allow liquefied natural gas to be transported by rail could come to a head this summer, with the Pipeline and Hazardous Materials Safety Administration (PHMSA) poised to make some big decisions .
By June 30, PHMSA and the Federal Railroad Administration are expected to issue their decision on temporarily suspending a 2020 rule allowing LNG to be transported by rail via dedicated tank cars while they review the impact on safety, the environment and on Aboriginal people. American tribes. This 2020 rule was signed into law under former President Donald Trump.
But there are other outstanding issues before federal regulators regarding LNG by rail. PHMSA is also considering final regulations to amend the regulations governing LNG by rail to incorporate ongoing research efforts. This decision is expected for June 30, 2024.
For its part, Energy Transport Solutions (ETS) is seeking to renew a permit authorizing it to ship LNG by rail. Trump had granted ETS the permit in 2020 so the company could export LNG through a terminal in New Jersey. PHMSA’s decision on this license renewal is pending.
To add more complexity to the issue, six environmental groups and 14 states plus the District of Columbia and a Native American tribe have filed a lawsuit against the US Department of Transportation over the 2020 rule.
Environmental groups call for a ban on LNG by rail
PHMSA noted that while companies could still transport refrigerated liquid methane, also known as LNG, by rail via dedicated tank cars, such transport has not occurred. However, current federal regulations allow LNG by rail using UN portable tanks with prior approval from the Federal Railroad Administration. The Florida East Coast Railway (FECR) and the Alaska Railroad have both been authorized to do so, but only the FECR is actively transporting LNG in mobile UN tanks.
UN tanks are smaller intermodal packages that hold about 10,000 gallons of product, while tank cars hold about 30,000 gallons, PHMSA told FreightWaves.
In fact, environmental groups want a total ban on LNG by rail. Last month, the groups called on US Transportation Secretary Pete Buttigieg to ban the transportation of LNG by rail, citing climate and health threats.
Environmental groups launched the campaign, Ban LNG by Rail, with a video, social media campaign and petition. They argue that LNG is a highly unstable and explosive liquid which, if released in a spill, could lead to the formation of rapidly expanding vapor clouds that could instantly freeze human flesh.
“We believe it is far too dangerous to move this flammable, dangerous and potentially explosive cargo by rail through communities. These freight rail lines pass right by — in some cases within yards — of people’s homes and target our most vulnerable communities and cities,” said Tracy Carluccio, deputy director of the Delaware Riverkeeper Network, in a recent interview with FreightWaves. .
Environmental groups are also against hydraulic fracturing, which is the process used to capture methane from the Earth. They argue that the release of natural gas, its liquefaction and transportation, and then its regasification release significant amounts of emissions.
“Allowing LNG to be transported by rail would trigger more fracking, pose a catastrophic risk to countless communities and delay the critical transition to clean energy,” said Thomas Meyer, national lead for the organization at Food & Water Watch, in a press release published at the end of May. “The Trump administration’s outrageous LNG rail rule must be reversed. If Secretary Buttigieg is serious about prioritizing climate action and fulfilling his department’s mission to ensure a safe and fair transportation system, he must take action to ban LNG by rail once and for all.
Carluccio also said the United States should not be swayed by European demand for LNG imports amid the Ukraine-Russia dispute. Europe has historically relied on Russia to supply the continent with LNG, although it is seeking to wean itself off LNG and boost its energy consumption from renewable sources.
“We are concerned that this commitment by the Biden administration will be eroded by this immediate crisis in Ukraine and the demand for gas from Europe,” Carluccio told FreightWaves, explaining that the White House has reached an agreement with the Union. European Union to increase LNG exports by 15 billion cubic meters per year.
This agreement could encourage domestic LNG production, she said.
Indeed, US LNG exports to Europe increased in the first four months of 2022, according to a June 7 memo from the US Energy Information Administration (EIA). During this period, the United States exported 74% of its LNG to Europe, compared to an annual average of 34% last year. Asia was the top destination for US LNG exports in 2020 and 2021.
U.S. LNG exports averaged 11.5 billion cubic feet per day in the first four months of 2022, up 18% from the same period in 2021, according to the EIA.
Freight Rail Association Says LNG Rail Transport Is Safe
Meanwhile, the Association of American Railroads maintains that the transportation of dangerous goods by rail is significantly safer than the transportation of dangerous goods by road, with more than 99.99% of rail shipments of dangerous goods reaching their destination without release caused by a train wreck, according to the AAR website.
The 2020 rule takes into account studies conducted on LNG by rail, and the rule outlines strict measures, the AAR said. These measures include specialized tank cars known as DOT-113, which have thicker outer shells; a joint initiative between the Class I railways and the government that analyzes the safest and most secure routes for transporting LNG; and equipping trains carrying hazardous materials with specialized equipment to further minimize potential damage to rail cars.
PHMSA told FreightWaves that the agency is currently reviewing more than 9,000 comments submitted to the November 2021 rulemaking proposal on whether to temporarily suspend the rule. The agency said that while PHMSA’s 2020 rule remains in effect, no transportation of LNG has taken place under the regulations, and the agency is not aware of any applications for the construction of tank wagons to be used within the existing authorization.
PHMSA also said it does not comment on ongoing litigation, including the DC Circuit Court lawsuit of 14 states and environmental groups.
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