A federal agency has invalidated a 2019 state law regulating crude oil transportation, concluding that a federal law preempts the state requirement. The move marks the second time in two weeks that a state law passed during the 2019 legislative session has been found unconstitutional, as recently a King County Superior Court judge also ruled against a state bank tax for violating the U.S. Commerce Clause.
There are currently five oil refining facilities in Washington state located in Bellingham, Tacoma, Ferndale and two in Anacortes; Bakken crude oil from North Dakota is transported to those facilities by a Burlington Northern Santa-Fe rail line.
The transport of crude oil through the state has been a source of contention following the 2013 Lac-Mégantic rail disaster in which a 74-car train in Canada derailed and several oil tanks exploded. SB 5579, sponsored by Sen. Andy Billig (D-3) last year, caps the level of crude oil pressure that facilities would be permitted to load or unload onto rail cars to no greater than 9 pounds per square inch (PSI).
In addition to opening the freight industry to multiple crude oil pressure limits, opponents of the bill argued that the issue was both beyond the state’s purview and not based on science. After the 2013 Le-Mégantic incident, Sandia National Laboratories was hired by the U.S. Department of Energy’s Office of Fossil Energy to study the connection between oil pressure and the potential for combustion. Its 2015 report found that “no single parameter defines the degree of flammability of a fuel; rather, multiple parameters are relevant.”
Sandia also completed an experimental study released last year of several North American crude oils that was more conclusive. It found that “vapor pressure is not a statistically significant factor” in combustion. “Thus, the results from this work do not support creating a distinction for crude oils based on vapor pressure with regards to these combustion events.”
Western States Petroleum Association Regional Director Jessica Spiegel said in a statement that “scientific studies…consistently have found that the vapor pressure limits Washington wanted to impose would not have improved safety. All that policy would have done is cap the safe and affordable transportation of crude oil into the state.”
In July, the states of North Dakota and Montana filed an application with the Pipeline and Hazardous Materials Safety Administration (PHMSA) to overturn Washington’s law. They were later joined in September by Arkansas, Indiana, Louisiana, Nebraska, Ohio, Oklahoma, South Dakota, Utah, West Virginia and Wyoming.
In its May 11 announcement, PHMSA concluded that the Federal Hazardous Material Transportation Law preempts Washington’s ability to set vapor pressure requirements for crude oil transported by rail.
In a statement, Burlington Northern Sante-Fe (BNSF) said: “a patchwork of different and conflicting local regulations would interfere with interstate commerce as outlined in the Commerce Clause of the U.S. Constitution,” though PHMSA declined to address the constitutional question and ruled strictly on statutory grounds.
BNSF noted further in its statement that 99.99 percent of its hazardous material shipments “reach their destination without incident. This is a responsibility that we take very seriously, and rail is the safest way to move all goods, including hazardous materials, on land.”
Spiegel wrote: “With the science behind this and the recent…determination that federal laws and regulations preempted Washington’s regulations, we are hopeful this issue is closed.”