Appendix A

Dissenting View of Gary D. Kenney

SUMMARY

I am in agreement with most of the conclusions drawn by the study committee. However, I disagree with the conclusion that prescriptive measures or standards for the installation of rupture mitigation valves (RMVs) on existing pipelines in high consequence areas (HCAs) is not desirable. I am concerned that the committee’s rejection of prescriptive measures and reliance on an improved integrity management (IM) process in evaluating the “need for” or whether the installation of RMVs would be an “efficient means” to reduce the consequences of a rupture on existing pipeline segments will likely:

• Achieve an incremental improvement, if any, in the actual installation of such devices on existing pipeline segments within or that could affect an HCA, and
• Result in a wide degree of variability in their installation as reflected by the various operators’ individual risk tolerance levels and variability in the administration and enforcement of the regulations from the federal-to-state and the state-to-state level.

To address these concerns, I am of a view that any revisions to the current regulations regarding the need to install RMVs on existing pipeline segments where a release could impact an HCA must be supplemented with clear, measurable, and enforceable standards. In this respect I am of an opinion that the Pipeline and Hazardous Materials Safety Administration

(PHMSA) should incorporate the 30-minute requirement to shut down and isolate a failed segment of an existing hazardous liquid or gas transmission pipeline segment within or that could affect an HCA and/or a Class 3 and 4 location as in PHMSA’s recently enacted RMV rule for newly constructed and fully replaced pipeline segments.

Any changes to the regulations will require a period of time to enact. Therefore, as an interim measure I am recommending PHMSA undertake and complete a series of focused onsite audits and inspections evaluating operators’ compliance with current regulatory requirements and their ability to shut down and isolate those existing segments of their pipeline segments within or that could affect an HCA and/or a Class 3 and 4 location.

BACKGROUND

Table A-1 presents the increase in the miles of pipelines within each network, the age of this infrastructure, and the increase in the U.S. population since 1971 when the National Transportation Safety Board (NTSB) first recommended the U.S. Department of Transportation study the need to install automatic and remote-control shutoff valves on hazardous liquid and gas transmission pipelines.

As seen in Table A-1, as of 2022 there are as many miles of hazardous liquid pipelines (approximately 93,000) located within or that could affect an HCA as were in the total network of pipelines when NTSB made its recommendation in 1971. As noted in Chapter 2, approximately 50% of the current operating network of pipelines was installed pre-1970, before

TABLE A-1 Increases in the Hazardous Liquid and Gas Transmission Pipeline Networks and U.S. Population, 1971 to 2022

SOURCES: PHMSA’s Gas Transmission and Hazardous Liquid Annual Reports and the U.S. Census Bureau’s National Population Totals. See www.phmsa.dot.gov/data-and-statistics/pipeline/pipeline-mileage-and-facilities; files: Gas Transmission & Gathering Annual Data – 2010 to present and Hazardous Liquid Annual Data – 2020 to present. See www.census.gov/programs-surveys/popest/data/datasets: National Population Totals.

enactment of the first federal minimum pipeline safety standards. Furthermore, as seen in the table there are approximately 60 million more people living within urban and suburban areas (i.e., high and other populated areas) of the United States than of the whole population in 1971.

Data are not readily available on the increase in unusually sensitive areas (e.g., ecological resource areas) in this more than 50-year period. Over the period of 2011 to 2021 hazardous liquid pipeline operators reported increases in the miles of pipelines within each of the various defined HCAs (see Table A-2).

If or when revising the current regulations for existing pipeline segments, these past, and likely to continue into the future, trends need to be considered as they culminate in an increasing potential of “unmitigated consequences of major ruptures” without an enforceable standard as PHMSA stated in the regulatory impact analysis for the recently enacted RMV rule.¹

THE EFFECTIVENESS OF THE CURRENT REGULATORY REGIME

The annual report forms that gas transmission and hazardous liquid pipeline operators file with PHMSA did not at the time of this study include a requirement to report on the number or type of valves operators have installed on their pipeline segments within an HCA and Class 3 and 4 locations.² As a result it is not possible to measure, quantitatively, the

TABLE A-2 Increase in the Miles of Hazardous Liquid Pipelines by HCA Type, 2011 to 2021

SOURCE: PHMSA’s Hazardous Liquid Annual Reports 2011 and 2022.

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¹ Preliminary Regulatory Impact Analysis, Amendments to Parts 192 and 195 to Require Valve Installation and Minimum Rupture Detection Standards Proposed Rule. PHMSAUSDOT. February 2020.

² Annual Report for Calendar Year 20_Natural Gas and Other Gas Transmission and Gas Gathering Pipeline Systems Form PHMSA F 7100.2-1 (rev 10-2014), and Annual Report for Calendar Year 20_Hazardous Liquid Pipeline Systems, Form PHMSA F 7000-1.1 (rev 6-2014).

effectiveness of the current provisions in the 2001 and 2004 IM rules for installing RMVs where an operator determined they were “needed” or an “efficient means” in reducing the impact of a release on an HCA or a Class 3 and 4 location. However, at the time of and since their enactment various reviews and studies of the provisions of the IM regulations have raised questions regarding their effectiveness, including their effectiveness at reducing the consequences of pipeline ruptures on segments within or that could affect an HCA or Class 3 and 4 locations. These include:

• In 2001, the U.S. Department of Justice’s Environment and Natural Resources Division (DOJ/ENRD), in comments made on the proposed IM rules for hazardous liquid pipelines, recommended “substantial revisions of the proposed rules to improve its enforceability … and clearly stated and unambiguous requirements for specific actions that achieve measurable results.”³
• In 2011, NTSB, in its report of the San Bruno, California, gas transmission pipeline rupture, explosion, and fires, found that there is “little incentive for an operator to perform an objective risk analysis” as regards to evaluating and installing RMVs on existing pipelines and recommended PHMSA amend its regulations and “directly require that automatic shutoff or remote control valves in high consequence areas and Class 3 and 4 locations be installed.”⁴
• In 2013, the Government Accountability Office (GAO), in a study and report of operators’ responses to pipeline incidents, concluded that while the regulations require operators to respond to emergencies in a “prompt and effective manner” that neither the regulations nor guidance describe ways to progress to that goal and without performance measures and targets, PHMSA itself cannot quantitatively determine whether operators are meeting that goal.⁵
• In 2015, an NTSB report into concerns about deficiencies in gas transmission pipeline operators’ IM programs and their oversight by PHMSA and state regulators contained 33 findings, among which were that inspectors lacked training to effectively verify operators’ risk assessments and that there was a lack of data

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³ 65 Fed. Register, 75382, December 1, 2000.

⁴ Pacific Gas and Electric Company Natural Gas Transmission Pipeline Rupture and Fire San Bruno, California, September 9, 2010. NTSB/PAR-11/01. August 30, 2011.

⁵ Report to Congressional Committees; Pipeline Safety, Better Data and Guidance Needed to Improve Pipeline Operator Incident Response, GASO-13-168. Government Accountability Office. January 2013.

regarding risk assessment approaches and insufficient data to successfully implement probabilistic risk models.⁶

• In 2019, NTSB, in testimony to Congress, stated that its recommendation from the San Bruno accident regarding the requirement to directly require the installation of RMVs on existing pipeline segments remained on “NTSB’s Most Wanted List of Transportation Safety Improvements and should be implemented by PHMSA expeditiously.”⁷
• In 2020, PHMSA, in its Regulatory Impact Analysis of the proposed rule requiring the installation of RMVs on newly constructed and fully replaced pipeline segments, noted a need for the regulations included that “although some individual operators have installed ASVs [automatic shutoff valves] and RCVs [remote-control shutoff valves] in response to high profile incidents … the potential for unmitigated consequences of major ruptures still remains high without an enforceable standard.” As a result, PHMSA stated in the preamble to its 2022 RMV regulations for newly constructed and fully replaced pipelines that the new rule “codifies a suite of design and performance standards.”^8,9

REVIEW OF COMPLIANCE WITH THE CURRENT REGULATION

As part of this study, the enforcement actions PHMSA initiated in 2007, and the 2011–2012 and 2018–2022 periods were reviewed. The data for 2018–2022 were reported in Table 5-1 in Chapter 5 of the report. I have added data for 2007, 2011, and 2012 in Table A-3.

2007 is the first year after the enactment of the IM rules that the webpage provides documents of the various enforcement actions PHMSA initiated in any 1 year. The enforcement actions initiated in 2007 were reviewed to serve as a baseline of related enforcement activity. The years 2011 and 2012 were selected as they were immediately after the 2010 San Bruno, California, incident and the 2010 Marshall, Michigan, incident¹⁰ and NTSB’s reports of those incidents. Those 2 years were included to see whether following those incidents there was an increased number of

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⁶ Integrity Management of Gas Transmission Pipelines in High Consequence Areas, NTSB/SS – 15/01. NTSB. January 27, 2015.

⁷ Pipeline Safety: Reviewing the Unmet Mandates and Examining Additional Safety Needs. NTSB. April 2, 2019.

⁸ Op. Cit. (3).

⁹ 87 FR 20934. Code of Federal Regulations. Vol. 87, No. 68. April 8, 2022.

¹⁰ Enbridge Incorporated Hazardous Liquid Pipeline Rupture and Release Marshall, Michigan July 25, 2010. National Transportation Safety Board. NTSB/PAR – 12/01. July 10, 2012.

TABLE A-3 Number of Enforcement Actions Initiated Related to the Provisions in the IM Rules to Identify HCAs and Evaluate the Need for Additional Preventive and Mitigative Measures

NOTES: The enforcement actions identified are only those related to the provisions the operator must take for identifying a pipeline segment in an HCA or that could affect an HCA and evaluations operators must perform on additional measures to prevent and mitigate the consequences of a failure including an evaluation of the need to install an RMV (i.e., emergency flow restricting devices or self- or remote-controlled valves).

SOURCE: PHMSA Pipeline Safety Enforcement Program, Summary of Enforcement Activity-Nationwide, https://primis.phmsa.dot.gov/comm/reports/enforce/Enforcement.html?nocache=6308.

enforcement actions initiated related to the requirements to evaluate additional preventive and mitigative measures for pipeline segments that could affect an HCA. The enforcement actions initiated from 2018 through 2022 were also reviewed being the most current to the date of this study.

As seen in the Table A-3, enforcement actions related to provisions within the IM regulations involving identification of HCAs and evaluating the need for additional preventive and mitigative measures account for between 5 and 10% of the total number of initiated enforcement actions for the three periods reviewed. No discernible increase in the number of enforcement actions were found in the 2 years following the 2010 San Bruno, California, and Marshall, Michigan, incidents compared to the other periods. In addition to the number of enforcement actions initiated,

the reasons PHMSA cited for alleging a probable violation were examined. Across all of the above years, the enforcement actions initiated were for alleged deficiencies in:

• The procedures, processes, or methods used to undertake the required risk analyses and evaluations;
• The process or method not considering or including all of the factors listed in the regulations or ASME B31.8S; and
• Not properly documenting the studies were performed and/or documenting the results of the studies.

In other words, the initiated enforcement actions were process based. In almost all cases, PHMSA’s required corrective actions focused on revising procedures, processes, or an actual evaluation or study. Other than where a corrective action was related to a significant incident, in the various Warning Letters, Notice of Amendments, etc., reviewed, no instance was identified where PHMSA required an operator to install additional preventive and mitigative measures including an emergency flow restricting device (EFRD) or RMV to reduce the potential consequence of a release on an HCA.

While PHMSA provides access to the various enforcement actions it initiates, information on the number of inspections and audits, the amount of time PHMSA and state inspectors allocate evaluating compliance with the relevant provisions in 49 CFR 192.935(c) and 195.452(i)(4) and the number of miles of pipeline segments by HCA type addressed is not provided on PHMSA’s website. PHMSA does make information regarding the number of inspection days allocated to the construction of new pipelines publicly available on its website.¹¹ However, when the committee asked for similar information relating to the relevant provisions of the IM rules, PHMSA replied that a Freedom of Information Act request would be required for it to provide that information. Such information would assist in providing a more complete picture on current compliance with and effectiveness of the relevant requirements.

CALIFORNIA REGULATORY ACTION FOLLOWING THE SAN BRUNO INCIDENT

Following the San Bruno incident, in 2011 the California Public Utilities Commission (Cal-PUC) enacted a rule adopting new safety and reliability regulations for intrastate natural gas transmission and distribution pipelines

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¹¹ See www.phmsa.dot.gov/pipeline/pipeline-construction.

within the state of California.¹² Cal-PUC’s rule required the state’s three gas transmission pipeline operators to submit what became known as Pipeline Safety Enhancement Plans (PSEPs) describing the various measures the operators were undertaking to improve the safety and reliability of their network of pipelines. One part of those plans included the evaluation of the need for, and plans to install, RMVs on gas transmission pipeline segments within populated areas. In contrast to the evaluations the three operators undertook in compliance with the provisions of 49 CFR 192.935(c) to determine if the installation of RMVs would be an “efficient means” to reduce the consequences of a rupture in Class 3 and 4 locations, Table A-4 summarizes the number of RMVs the operators determined were to be installed on various pipeline segments to mitigate the consequence of a release in populated areas to comply with Cal-PUC’s rules.

DISCUSSION

In several meetings throughout the course of the study committee’s investigation, questions were put to various invited operators, industry associations, and regulators concerning the number, spacing, and types of valves operators have installed on pipeline segments within or that could affect HCAs. The more or less standard answer received was that the information exists in the files of the operators themselves. Even when the question was

TABLE A-4 Number of Valves Installed on Gas Transmission Lines in Response to Cal-PUC’s 2011 Rule

SOURCES: Data generated from Pacific Gas & Electric Company’s Natural Gas Transmission Pipeline Replacement or Testing Implementation Plan. Pacific Gas & Electric Company. August 26, 2011; Pipeline Safety and Enhancement Plan (PSEP) Final Compliance Report. Pacific Gas and Electric Company. March 6, 2019; and Pipeline Safety Enhancement Plan of Southern California Gas Company (U 904-G) and San Diego Gas & Electric Company (U 902-M), Southern California Gas Company and San Diego Gas & Electric Company. August 26, 2011.

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¹² Decision Determining Maximum Allowable Operating Pressure Methodology and Requiring Filing of Natural Gas Transmission Pipeline Replacement or Testing Implementation Plans. Public Utilities Commission of California. June 16, 2011.

asked of regulators, the answer was that the information was in the files of the operators. Without ready access to such information it places state and PHMSA inspectors at a considerable disadvantage when discharging their administrative and enforcement responsibilities. Furthermore, as noted previously, quantitative data or information that would assist assessing that the current regulations and their administration have been effective is not available, at least to the general public, to ensure the public operators have installed RMVs where “needed” or an “efficient means” to reduce the consequences of a pipeline rupture on an HCA or a Class 3 and 4 location.

While quantitative data are not available, the various studies, reports, and enforcement actions cited in the previous section raise some serious questions concerning the effectiveness of the current regulations’ reliance on the use of risk assessment processes for determining the need to install RMVs on existing pipeline segments. In that respect, perhaps what is particularly telling is in the promulgation of the RMV rules for newly constructed and fully replaced pipelines. Rather than relying solely on the use of risk assessment methods for determining the need to install RMVs, PHMSA itself determined the need to codify “a suite of design and performance standards” for their installation. As detailed in Chapter 2, more than 90% of the pipeline segments within or that could affect an HCA or a Class 3 and 4 location are existing pipelines. Furthermore, of that, almost half of those miles are pipelines installed prior to the enactment of the 1970 federal minimum safety standards. As a result, it seems only appropriate as PHMSA determined for newly constructed and entirely replaced pipeline segments, that a critical need exists to include clear performance standards for installing RMVs on existing lines.

RECOMMENDATIONS

In light of:

• Past increases and probable continuing trends in population, identified areas of eco-system concerns, the miles of pipelines innervating such areas, and the age of the infrastructure;
• Concerns regarding the effectiveness of the current regulations, their administration, and enforcement;
• That PHMSA’s recently enacted RMV rules codified and incorporated design and performance standards to improve its enforceability; and
• That any revisions PHMSA decides to make to the current regulations will, necessarily, need to follow the requirements for rulemaking in the Administrative Procedure Act,

I offer the following recommendations:

Recommendation A1, Revise the current regulations to include clear and enforceable performance standards:

PHMSA should revise relevant sections of 49 CFR Parts 192 and 195 to require that an operator must be able to demonstrate that, as soon as practicable, but within 30 minutes of rupture identification, the operator can fully isolate failed segments of existing pipelines within HCAs to minimize the volume of gas (or liquid product) released and mitigate the consequences of the rupture. When evaluating the need for an RMV, EFRD, or alternative equivalent technology on an existing pipeline segment located within or that could affect an HCA, the requirement to isolate the pipeline segment within 30 minutes must be fully integrated into the evaluation.

Where an operator cannot demonstrate the ability to fully isolate an existing pipeline segment within or that could affect an HCA in 30 minutes or less the operator must upgrade existing manual valves to an RMV, EFRD, or alternative equivalent technology state. PHMSA may agree to waive this requirement where the operator demonstrates it is operationally, technically, and economically infeasible to install such equipment. Any such waiver must include a report, signed by an officer of the operator, that:

• Describes the methodology used and results of the studies supporting the operational, technical, and economic infeasibility of installing the equipment;
• Includes the estimated consequences of a worst-case scenario failure on the impacted HCA and that the operator has involved the local emergency services in developing the estimate(s);
• The public within the impacted area and the immediate surroundings were informed of and consulted with respect to the consequences and the request for waiver.

Any evaluations or assessments conducted under this requirement must be reviewed, revised, and signed by an officer of the company and where necessary a new waiver raised:

• As part of the corrective actions following a major incident on the operator’s network of pipelines,
• A major change in the operational status of the pipeline segment,
• A change in the built or natural environment through which the pipeline right-of-way passes,

• A change in the organizational structure including changes in staffing levels that would affect the ability to isolate the pipeline segment,
• On a periodic basis.

To be clear, in contrast to the regulations for newly constructed or and fully replaced pipeline segments, I am not recommending that additional valves need to be installed on existing pipelines if the segment does not meet contemporary valve spacing requirements. Rather, I am recommending that existing manual valves upstream and downstream of an HCA, and any intermediate manual valves within the HCA, be enhanced or upgraded to an RMV state. As noted above, I suggest provisions be included that would allow an operator to request a waiver, on meeting certain conditions.

As noted in Chapters 1 and 6, PHMSA has maintained it does not have the authority to issue regulations for retroactive changes to existing pipelines due to the “nonapplication” clause in Title 49 USC § 60104(b). In response, while NTSB has maintained that PHMSA has such authority, it also recommends Congress explicitly exempt RMVs from the non-application clause. For PHMSA to act on Recommendation 1 above, it is possible Congress may need to address and clarify the issue of the non-application clause.

Recommendation A2, As an interim measure, PHMSA to complete a focused program of inspections and audits of current compliance:

PHMSA should develop and aim to complete promptly (such as within 12 months) a comprehensive enforcement program consisting of a series of field-focused audits and inspections of existing pipeline segments that could affect an HCA, including

• An evaluation of the current plans, programs, procedures, and equipment operators have in place to respond to pipeline failures on segments within the various types of HCAs.
• Verification through onsite assessments that the current mitigative measures minimize the consequences of a rupture.
• A comparison of the site verification assessments to the risk analyses or evaluations operators have undertaken of the need to take or install additional preventive and mitigative measures.
• After completing this work, PHMSA should provide a report of its findings to the Secretary, Congress, and potentially impacted and interested parties.

In the final sentence of the report the majority of the committee writes that “if PHMSA is not successful in furthering the recommended actions, or operators do not implement them effectively, then alternative approaches may be warranted, including the introduction of regulatory standards stipulating when RMVs should be installed.” Because I have little confidence that even a more rigorous and transparent IM process will deliver, the time for supplementing the current regulations with some clear enforceable standards is now.