September 5, 2002
Eastern Research Group
Re: Impact of Draft Proposed PCB Rule Revisions (40 C.F.R. Part 761
Dear Ms. Wendel:
Thank you for the opportunity to comment informally on some of the possible revisions that EPA is contemplating in the PCB Mega Rule. The following letter responds to your electronic letter to me dated July 17, 2002 regarding the potential impacts of seven possible revisions to 40 C.F.R. Part 761
- Expanding the Director’s Authority to Modify Rules for Reusing Gas Pipe and Equipment - Minimal Impact
The natural gas use authorization -- Section 761(i)(1)(iii)(A) -- authorizes the use of PCBs in natural gas pipeline systems, provided the gas utility or pipeline company complies with up to six conditions. Systems that include “potential sources” of PCB contamination (compressors, scrubbers, certain filters, and interconnects) must meet all six conditions. Systems that do not have potential sources are exempt from all but two conditions. Gas utilities often qualify for this exemption. See 40 C.F.R. §761.30(i)(1)(iii)(B).
As you note, existing section 761.30(i)(1)(iii)(D) authorizes the EPA Director of the National Program Chemical Division (Director) to modify or waive any of these natural gas pipeline use authorization requirements. The modification or waiver must be in writing and must be based on a finding of no unreasonable risk to health or the environment. This allows the Director, for example, to extend compliance dates or waive one or more requirements for: (1) preparing a written description of the general nature and location of PCBs in a natural gas pipeline system, (2) characterizing the extent of PCB contamination in a pipeline system by collecting and analyzing samples, (3) sampling and analyzing “potential sources,” (4) removing potential sources or implementing “other engineering measures” to reduce PCB levels in potential sources, (5) performing annual repeat sampling, and (6) marking above ground sources. The provision does not currently allow waiver of the requirements for “reusing” pipe or equipment.
EPA’s Possible Revision
Your letter notes that EPA is considering whether to expand this waiver authority to allow the Director to waive both use and reuse requirements, upon a finding of no unreasonable risk.
Potential Impact on Gas Utilities
AGA has no objection to expanding the waiver authority to authorize waivers of the reuse requirements. It may be helpful in the future to have some flexibility in the reuse provisions that we cannot anticipate at the moment. However, we question whether this will have any impact in the real world – especially if EPA proceeds with the revision you describe in item 2.
The Part 761 requirements for reuse are not the problem, so the proposal to allow the Director to waive those requirements will not remove the main barrier to pipe reuse. Instead, as discussed under item 2 below, the real barrier is this position taken in EPA’s Question and Answer (Q&A) Manual opining that the statutory ban on “distribution in commerce” bans the sale of PCB-contaminated pipe in the ground for reuse by anyone other than the original owner. I discuss under item 2 why EPA should not codify this position in the regulation and in fact should propose to revise the rule to clearly authorize the sale of PCB contaminated drained pipe for reuse as cable conduit.
You asked how common is it now for companies to request a waiver of the use requirements. Companies may have sought waivers of some of the deadlines or requirements for characterizing pipeline systems or addressing potential sources in the first year or so after EPA promulgated the PCB Mega Rule in 1998, but we are not aware of any recent waiver requests pertaining to the use requirements. We believe that gas utilities now have well-established programs for characterization, sampling, and engineering methods for controlling potential sources. In addition, AGA worked with EPA to develop several Q&As that help clarify EPA’s interpretation of the use authorization requirements and provide some needed flexibility. See Q&A Manual e.g. page 19 item #3 (plastic pipe sleeving projects allowed as continued use), page 21 #4 (paper like filters are not sources), page 23 #2 (how to sample dry systems), and page 23-24 #3 (on-going program for removing pipeline liquids constitutes an “engineering measure” satisfying use condition for reducing PCB sources, where PCB contamination originally came from outside gas utility’s system). The Q&A Manual is posted on EPA’s PCB home page: www.epa.gov/opptintr/pcb/guidance.html
At this point, our members have more interest in updating the rule to reflect technology changes since 1998 and to make the requirements for pipe disposal and sampling more workable. Our members are especially interested in being allowed to use new practical options for sampling small pipe.
In sum, the proposal to allow waivers of the reuse requirements may provide additional flexibility, so we would support that change. But it is difficult to imagine how that would have any real impact, unless and until EPA clarifies that the ban on distribution in commerce does not apply to and does not bar the sale of abandoned PCB contaminated pipe for reuse by others, e.g. for cable conduit.
2.Reuse of PCB-Contaminated Natural Gas Pipe & the Ban On Distribution in Commerce
Section 761.30(i)(2) provides that: “Any person may reuse PCB-Contaminated natural gas pipe and appurtenances in a natural gas pipeline system, provided all free-flowing liquids have been removed.” EPA determined that such reuse would not pose any unreasonable risk to human health or the environment. See PCB Mega Rule Preamble, 63 Fed. Reg. 35384, 35396, col. 3 (June 29, 1998)
In section 6(e) of the Toxic Substances Control Act of 1976 (TSCA), Congress declared that except as authorized by an EPA rule, after 1976 “no person may manufacture, process, or distribute in commerce or use any polychlorinated biphenyl in any manner other than in a totally enclosed manner.” 15 U.S.C. §2605. In TSCA §3, Congress defined the term “commerce” to mean “trade, traffic, transportation, or other commerce (A) between a place in a State and any place outside of such State….” 15 U.S.C. §2602 (emphasis added). Congress further defined the term “distribution in commerce” to mean “when used to describe an action taken with respect to a chemical substance [e.g. PCBs] or mixture or article containing a substance … to sell, or the sale of, the substance, mixture, or article in commerce ...” 15 U.S.C. §2602.
It is obvious that when Congress enacted TSCA 26 years ago, Congress meant to ban the sale and transportation of products such as drums of PCB dielectric fluid or lubricant oil that could be moved down a highway “between a place in a State and any place outside of such State.” It is equally obvious that Congress did not intend to ban or restrict the sale of real property and fixed assets. There is nothing in the legislative history to indicate any intent to abrogate the established common law principle that restraints on the alienation of real property are repugnant. The United States Supreme Court has held that “in order to abrogate a common law principle, the statute must ‘speak directly’ to the question addressed by the common law.” U.S. v. Texas, 507 U.S. 529, 534 (1993).
TSCA does not expressly or implicitly impose a restraint on the transfer of real property, and therefore by law it cannot and does not ban the sale of real property or fixed assets such as buried abandoned pipe. EPA therefore has no legal authority to impose a ban on the sale of buried PCB-contaminated pipe for reuse.
EPA staff nevertheless included an item in the PCB Q&A Manual posted informally on EPA’s web site that states that the TSCA ban on distribution in commerce does restrain the sale of buried PCB-contaminated pipe for reuse.
EPA’s Proposed Rule Revision
It appears that EPA is now considering whether to codify this Q&A position in the Part 761 rule. AGA strongly opposes this proposal. We believe it would not survive court challenge.
You should be aware that EPA Deputy Assistant Administrator Susan Hazen recently sent a letter dated July 15, 2002 to Doug Green, counsel to the Utility Solid Waste Activities Group (USWAG) clarifying EPA’s interpretation of the distribution in commerce ban in other situations. AGA is a member of USWAG and participated in discussions with EPA that lead to the July 15, 2002 letter and its “Enclosure.” AGA appreciates the conclusion in the Enclosure that the ban on distribution in commerce does not restrict the sale of an operating natural gas pipeline (or gas utility) system that is operating in accordance with the natural gas pipeline use authorization under section 761(i)(1)(iii)(A). We believe a better rationale would be to conclude that Congress did not intend to restrain sales of real property and fixed assets, and that therefore the ban does not apply to pipeline systems. But the Enclosure at least arrives at the same result, and we certainly appreciate the result.
We will continue to urge EPA to adopt the rationale that the TSCA ban on distribution in commerce does not apply to real property transactions and therefore does not apply to sales of operating pipeline systems – or abandoned PCB-contaminated pipe. As a policy matter, EPA has already determined that reuse of such pipe for cable conduit poses no unreasonable risk to human health or the environment. There is no reason why the same reuse by a new owner would have any different impact on health or the environment.
AGA’s Proposed Alternative Revision
AGA will urge EPA to delete the Q&A. We will also urge EPA to clarify in the revised Part 761 Rule that the TSCA ban on distribution in commerce does not apply to real property transactions, such as the sale of a buried, abandoned gas pipeline. We believe this is the most logically and legally defensible interpretation of the statute and applicable case law. In the alternative, EPA could revise the rule to expressly authorize the “distribution in commerce” of PCB contaminated gas pipelines and appurtenances for reuse.
Impact on Natural Gas Utilities
In the 1978 Mega Rule, EPA took credit for cost savings of between $178.1 million and $736.1 million. 63 Fed. Reg. 35384, 35433 (June 29, 1998). Presumably a significant portion of this amount was based on the value of being able to sell PCB-contaminated drained pipe for reuse as cable conduit. Since you helped prepare that cost impact assessment, you may know how much of the cost savings were based on the reuse of natural gas pipe. EPA’s proposal to ban sales of buried pipe for reuse would have an equivalent negative cost impact.
AGA members gave me a few estimates that may also be helpful. Before the 1998 Mega Rule, a gas utility company entered into a transaction to allow a communications firm to run fiber optic cable through about one mile of abandoned pipe with a diameter over 12 inches. The utility wipe tested both ends of the pipe and found no PCBs. There were no liquids. The gas utility received about $75,000 on closing and then received about $22,000 per year in rent for continued use of the pipe as cable conduit.
The cost to decontaminate pipe by solvent washing can vary, but one member on the East Coast gave me an estimate ranging around $10,000- $11,000 per 660 feet of pipe, including the cost for the decontamination contractor, decon solution, mobilization and demobilization, but not including the cost of opening the pipe or restoring e.g. pavement cuts. A western member indicated that a contractor’s rough estimate to clean 10 miles of 34-inch diameter pipe was about $300,000 (or about $30,000 per mile).
3. Using Historical Data In Place of Wipe Samples for Sampling “Dry Samples”
Section 761.30(i)(4) provides that:
“Any person characterizing PCB contamination in natural gas pipe or natural gas pipeline systems must do so by analyzing organic liquids collected at existing condensate collection points in the pipe or pipeline system. The level of PCB contamination found at a collection point is assumed to extend to the next collection point downstream….[I]f no liquids are present, they must use standard wipe samples in accordance with subpart M of this part.”
EPA’s Proposed Rule Change
You have indicated that EPA is considering whether to modify this rule to allow the use of historical samples of liquids from a natural gas system that does not contain liquids (i.e. a dry system) until liquid is available in the system to sample.
For your general background, EPA has interpreted the existing Part 761 rules to allow the use of historical data in several contexts.
First, in pipe sleeving projects, utilities typically test any liquids and collect wipe samples of any sections of removed old cast iron pipe (in an area suspected to have PCBs). This is done to comply with the rule under 761.60(b)(5)(ii) for pipe removal and disposal. In the pipeline Q&As, EPA “recommends maintaining records of this PCB characterization until the time of abandonment or disposal of the system and/or its components ... EPA will consider these records regarding characterization, done at the time of the insertion process, to be valid for compliance with applicable characterization requirements for abandonment and disposal in §761.60(b)(5)(iii). See Q&A 761.30(i) #3 at page 19 of the Manual.
Second, the rules allow a company to use historical data to document the absence of potential PCB sources in a pipeline system and to characterize a pipeline system to document that PCBs are <50 ppm. See 40 C.F.R. §761.30(i)(1)(iii)(E). See also Q&A Manual 761.30(i) Potential Sources #1 page 21; Historical Data for Characterization #1 and #2 page 24.
Third, the Q&A Manual indicates that in dry systems, when liquids are not available for the annual sampling required under section 761.30(i)(1)(iii)(A)(5), then the sampling requirements do not apply. “However, EPA would expect the owner/operator of the pipeline system to continue to check at least annually for liquids and document their absence under the recordkeeping requirements… Should any liquids appear later, the liquids should be tested.”
Impact on Gas Utilities
It appears that EPA is proposing to codify the foregoing Q&As in the regulation, at least in large part. AGA agrees this rule modification would provide a helpful clarification.
We would also urge EPA to go one step further and modify the rule to clearly allow the use of historical wipe samples as well as historical liquid samples for characterization. While we understand EPA did not intend to require wipe sampling to characterize natural gas pipeline systems (which is usually impossible for operating gas lines), this should not preclude EPA from allowing this very practical sampling method for dry systems, where wipe samples can be done or have been performed in the past – for example during routine repair or pipe sleeving projects.
You asked about the cost of wipe samples and annually re-sampling at locations where a company has found PCBs > 50 ppm. A member company on the East Coast indicated that the cost for a wipe sample depends on how quickly one needs the lab results. For a 3-4 week turnaround, they can get a wipe sample processed for about $80. A 2-week turnaround costs them about $120 per sample. A 1-week turnaround costs about $160, and a fast 48-hour turnaround costs about $240 per wipe sample. This may vary for companies that have in-house laboratories. Regarding how much time it would take to research historical data for a pipe, a company responded: no time at all, because they have the data entered in their data system in an excel spreadsheet. The time to prepare an annual sampling log is about 1 hour for this company, using a data system that generates spreadsheets.
4. Use Authorization for Old Pipe Sleeved with New Plastic Pipe
The existing rule does not specifically address how the 761.30(i) use authorization for natural gas pipeline systems should apply to the continued use of old steel or cast iron gas utility pipe that is renewed and sleeved with modern plastic pipe. However, the rule generally does not delve into this level of detail regarding how natural gas utility and interstate pipeline systems are typically operated. Plastic pipe sleeving projects are very common and take place routinely every spring, summer and fall at many gas utilities across the country. They are essential projects needed to improve and modernize gas utility systems to ensure safe, reliable and efficient natural gas delivery to customers. Such projects are implicitly allowed under the use authorization for natural gas pipeline systems.
In 1999, EPA agreed and interpreted section 761.30(i) to allow the continued use of old pipe sleeved with new plastic pipe in a non-destructive sleeving project.
“The non-destructive insertion of the new plastic pipe into the existing metal pipe can be considered as continued use of the natural gas pipeline system, under §761.30(i)…”
See Q&A Manual 761.30(i) General #3 page 19. This was one of the key pipeline Q&As that AGA developed with EPA in 1998-1999. Our members have been relying on it to conduct routine pipe sleeving projects for the past four years.
As far as AGA can determine, EPA has never required companies to obtain a risk-based approval under Section 761.61(c) for any pipe sleeving project. We are not aware of any member seeking such a risk-based approval for plastic pipe sleeving. Do you have any evidence that someone has sought a 761.61(c) approval for a pipe sleeving project? Based on our members’ experience in seeking such approvals in other contexts, this can be a very time-consuming and cumbersome process. EPA would cause a great deal of delay and disruption if it ever imposed such a requirement on pipe sleeving. This would be contrary to President Bush’s Executive Order 13212 requiring all federal agencies to take steps to expedite (not delay) energy-related projects. 66 Fed. Reg. 28357 (May 22, 2001).
You also asked about the cost to perform a wipe sample. However, this is not relevant to assessing the cost impact of the pipe sleeving proposed rule modification. In order to insert new plastic pipe in an existing pipe, one usually cuts and removes short sections (@ 3-6 feet long) of the existing pipe about every five city blocks or so to allow room for inserting the new pipe and pushing it up to the next cut location. In order to determine how to dispose of the pipe under section 761.60, the utility needs to characterize the section of pipe that is removed for disposal. This is why companies perform wipe samples on sections of removed pipe. The proposed rule modification for pipe sleeving will have no effect on pipe disposal requirements.
For purposes of estimating the economic impact of the proposed rule modification, you should note that the proposed modification will not change current practice or EPA’s interpretation of the existing rule. It will simply make the rule clearer. This will be beneficial, but it will not change the economics of these projects. On the other hand, if EPA should ever contemplate imposing additional requirements or preventing such pipe sleeving projects, that would have tremendous negative economic impact on natural gas delivery systems – probably measured in millions of dollars.
5. Natural Gas Pipe Decontamination
Section 761.60(b)(5)(i)(C) provides that natural gas pipe may be abandoned in place if each end is sealed closed and either (1) the pipe is decontaminated with a solvent wash “in accordance with the use and disposal requirements of §761.79(d)” or (2) the pipe is filled with grout.
Section 761.79(d) describes the rules for use and reuse of decontamination solvent. Section 761.79(d)(3) also requires used solvent to be disposed of in accordance with 761.79(g), which outlines the solvent disposal requirements.
Proposed Rule Change
EPA plans to clarify §761.60(b)(5)(i)(C) so that it refers to both 761.79(d) and (g).
Although this will be a helpful clarification, it will not change the rules at all and will have no real impact since 761.79(d) already required compliance with 761(g). The modification will help make it easier for the regulated community to figure out what the rule requires without having to back-track through several rule cross-references. We appreciate anything that helps reduce frustration and headaches in deciphering the Mega rule.
6. Confirmatory Sampling of Decontaminated Pipe – Subpart M and P
You indicate that EPA plans to amend §761.79(d) [I believe you actually meant § 761.79(b) and (f)] to allow the use of either Subpart M or P for confirmatory sampling after decontaminating pipe. This would be a useful clarification. Subpart M is designed for wipe sampling natural gas pipe greater than 4 inches in diameter. Subpart P describes sampling methods for large, nearly flat non-porous surfaces. The Q&A Manual did not help in this regard. At page 59, 761.60(b)(5(i) Decontamination #2 states that under the current rule, if a company wants to use Subpart M for confirmatory sampling, it should apply for an alternate sampling approval under §761.79(h)(3). This is a cumbersome and unnecessary requirement.
7. Disposal of PCB Waste in Municipal Solid Waste Landfills
The rules are confusing and not clear, but a close reading shows that “PCB-Contaminated” (50-500 ppm liquid or 10-100 ug/100 cm2 wipe sample) natural gas pipe may be disposed of in a facility permitted to manage municipal solid waste, and that the requirements of subparts J and K (recordkeeping, manifesting etc.) do not apply to such PCB-contaminated pipe or other articles provided all free-flowing liquids have been removed. See §761.60(b)(6)(ii)(A) and (ii)(C). However, this does not help us determine how to deal with small pipe < 4 inches or less in diameter, because there is currently no approved method in the Mega Rule for sampling small pipe for purposes of determining whether it is above or below the 500 ppm threshold for “PCB-Contaminated” pipe.
Proposed Rule Change
You have indicated that EPA plans to revise the rule to make it clear that small pipe of any diameter with any PCB concentration may also be disposed of in a municipal waste facility without having to follow the recordkeeping, manifesting and other requirements of Subpart J and K. The revised rule would also expressly list “PCB-Contaminated Natural Gas Pipe” as qualifying for this treatment, so that the reader does not have to parse the definitions of “PCB Article” and “PCB-Contaminated” in §761.3 to figure out that the term “PCB-Contaminated Articles includes PCB-Contaminated Natural Gas Pipe, and therefore the provision in 761.60(b)(6)(ii)(C) exempting PCB-Contaminated Articles also in effect exempts PCB-Contaminated Natural Gas Pipe from Subparts J and K.
This will be a useful clarification that will reduce the time it takes to decipher the regulations. In addition, it will be helpful for managing small pipe.
In response to your questions, we do not know of anyone who has disposed of PCB-contaminated natural gas pipe in municipal solid waste facilities. It takes about one hour to prepare a shipping manifest for a pipe shipment and enter the manifest into the company’s database.
Again, AGA appreciates the opportunity to provide early input as EPA develops the draft PCB mega Rule amendments. We are also developing a list of other possible changes that could help streamline the rule. I will forward the list to you and/or directly to EPA as seems appropriate. If you have any questions, please call me at (202) 824-7340.
Pamela A. Lacey
Senior Managing Counsel
American Gas Association