Late in 2021, Democrats led by Rep. Bobby L. Rush (Ill.) introduced HR 6084, the Energy Product Reliability Act. The bill would require the US Federal Energy Regulatory Commission (FERC) to create an Energy Product Reliability Organization (EPRO) for the purpose of establishing and enforcing reliability standards.
Modelled after the North American Electric Reliability Corp. (NERC), formed in the wake of 2003 and 2005 incidents exposing weaknesses in the power grid, EPRO would focus on threats—cyber or physical—to the reliable operation of the natural gas, crude oil, and refined products pipelines crossing the US. House Committee on Energy & Commerce hearings on the bill began in mid-January.
The February 2021 electrical grid failure in Texas and the May 2021 cyberattack on Colonial Pipeline Co.’s business systems were front-of-mind as deliberation began. An earlier joint FERC-NERC report had concluded that “generating unit outages and natural gas fuel supply and delivery were inextricably linked” during the February storm and suggested that Congress should vest a single agency with pipeline reliability oversight.
FERC Chairman Charles Glick, one of two witnesses brought before the House committee for the January hearing, said the lack of mandatory reliability standards for gas pipelines “poses a risk to the reliability of the bulk power system.” The Interstate Natural Gas Association of America (INGAA), however, was one of eight industry groups objecting to the bill, describing the real problem as “capacity constraints resulting from federal and state permitting obstacles.” The National Association of Regulatory Utility Commissioners added that the “undefined broad authorities granted by this legislation are a recipe for needless litigation at taxpayer expense.”
Such complaints may well be true. But committee member Fred Upton’s (R-Mich.) description of the bill as “a sweeping power grab preempting states’ authority” is specious at best. States will still be free to inspect pipelines and keep their citizens safe. Moreover, the interstate nature of most transmission pipelines, combined with the urgency of the service they provide, make it almost mandatory that the federal government plays a role in ensuring their safe operation.
New layer not needed
Even so, the proposed legislation is both duplicative and impractical. Although true that there is no single regulatory body responsible for overseeing transmission pipeline reliability in the US, the Department of Transportation’s Pipeline & Hazardous Materials Safety Administration (PHMSA) already has numerous regulations in place addressing everything from construction methodology to maintenance requirements and control-room best practices.
Meanwhile, the US Department of Homeland Security’s Transportation Security Administration (TSA) last year issued two security directives addressing pipeline cybersecurity and is developing rulemaking to establish a permanent program. The associations rightly noted that “Congress risks disrupting these cybersecurity efforts by granting duplicative authority to EPRO and FERC.”
The regulations in place were developed to ensure the safe and reliable operation of pipelines across the country. By and large they’ve been successful. An average of 30 serious pipeline incidents per year occurred 2018-20 according to PHMSA data, versus 35/year 2001-20. Serious incidents are those causing either a fatality or an injury requiring in-patient hospitalization.
Total pipeline incidents/year are flat in the low 600s. But another layer of regulation is unlikely to fix this. PHMSA is already stretched thin. It’s Office of Pipeline Safety as of May 2021 had 211 inspection and enforcement personnel. They and 433 state inspectors are responsible for regulating nearly 3,000 companies operating 2.8 million miles of pipeline, 164 LNG plants, 402 underground gas storage fields, and 8,142 hazardous liquid breakout tanks.
We don’t need another layer of pipeline regulation. PHMSA and TSA need to be granted authority and funding to hire more staff and do whatever else they can to better enforce regulations already in place. Operators also need to continue improving their self-regulation. The more they do in this regard, the better off they’ll be.
