[author: Scott Green]
Introduction
Insurers should note that environmental regulations designed to protect against releases from fuel distribution Aboveground Storage Tank (AST) systems, as defined under EPA 40 CFR Part 112, are less stringent than the requirements governing Underground Storage Tanks (USTs) under 40 CFR Part 280.1 This remains true even when an AST system includes underground leak detection and spill-prevention measures identical to those of a UST system.
J.S. Held was engaged to assess the applicable standard of care for the below-ground components of an AST system in a recent litigation. During this review, it became evident that this facility and other facilities like it may not consistently conduct routine inspections of AST system components as defined in a Spill Prevention, Control, and Countermeasure (SPCC) plan. The SPCC is the heart of EPA regulation 40 CFR Part 112 and https://www.google.com/url?sa=i&source=web&rct=j&url=https://www.ecfr.gov/current/title-40/chapter-I/subchapter-D/part-112&ved=2ahUKEwjSn_iNsZiSAxXPg4kEHavaB00Qy_kOegQIARAC&opi=89978449&cd&psig=AOvVaw0vtfoz4BqF8b3Nq-oRMMT-&ust=1768938913755000 requires certain facilities to take measures to prevent oil discharges into U.S. navigable waters or adjoining shorelines.2 Findings showed that inspections are inconsistent, incomplete, or sometimes not conducted at all, including failures to test and replace underground components as required by the applicable site-specific SPCC plan.
This breakdown may be partly attributable to the absence of clear regulations requiring state or federal agencies to regularly inspect the AST system, ensuring personnel training, as well as system testing and monitoring are performed, and issue and enforce inspection violations for the below-ground portions of AST systems that do not comply with the SPCC regulations. By contrast, UST systems, especially those with a suspected leak or other deficiencies, are highly regulated and routinely inspected by state or federal inspectors to ensure deficiencies are corrected before fuel operations can continue. The question is, why are the components of a UST system regulated differently when they have very similar, or in some cases, the exact same construction and environmental protection functions as the underground portions of AST systems? This discrepancy raises the question of what the industry’s standard of care should be for addressing leaks, spills, and other deficiencies at AST facilities.
UST Systems (40 CFR Part 280)
The federal UST program is a comprehensive regulatory program designed not only to correct spills and discharges of petroleum substances from UST systems but also to prevent them from happening in the first place. The program underwent major regulatory revisions in 2015,3 adding regulatory provisions that require secondary containment, operator training/certification, periodic operation and maintenance requirements, and more stringent inspection and enforcement actions by state/federal regulators, along with other updates to Part 280.
A key factor in the success of this revision was the requirement that all new or repaired fuel dispensers be installed with under-dispenser containment (UDC) beginning April 11, 2016. In addition to the physical catch barrier the UDC provides, existing UST sumps, including Submersible Turbine Pump (STP) sumps, transition sumps, and UDCs that have interstitial monitoring of piping and spill buckets, are required to undergo pressure testing no later than October 13, 2018. These fixtures must be repaired and/or replaced if they fail the pressure testing. These measures require additional mandatory pressure testing every three years to ensure the secondary containment structures remain tight and prevent fuel releases, a major source of which are deteriorated penetration fittings, cracks, or failed seals that breach UDC walls and create an unwanted interface with the underlying and surrounding environmental media.
Another vital component of this revision is the requirement that certified personnel and state and federal regulators perform regularly scheduled visual inspections of the UDC systems. These individuals have the authority to issue violations and mandate testing and replacement of failed components before a system can return to operation. Together, these requirements helped significantly reduce leaks from UST systems and improved overall system integrity by mandating specific operation and maintenance (O&M) practices.
O&M provisions include:
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Operator training and certification are required, defining Class A, B, and C operators to inspect and maintain the UST system, investigate suspected releases, and report confirmed releases to the governing state or federal agency.7
Most states now operate mature UST programs. As of May 2024, 39 states, plus the District of Columbia and Puerto Rico, have EPA-approved UST programs (SPA) with these implementing agencies serving as primary regulators, provided their rules are at least as stringent as the federal program.
SPCC-Driven AST Compliance & Regulatory Gaps
AST system regulations operate in a very different manner, with many requirements that do not require registration or financial assurance, unlike commercial USTs under 40 CFR Part 280. The SPCC Regulations, governed under 40 CFR Part 112, apply to facilities that store oil in aggregate quantities greater than 1,320 gallons aboveground (counting only containers 55 gallons or greater) where that oil could be expected to discharge into or upon navigable waters of the U.S. or adjoining shorelines.
One limitation of 40 CFR 112 is its primary focus on preventing surface spills that could reach navigable waterways, with comparatively little regulatory attention to fuel releases from underground portions of AST systems that can affect groundwater. Although many states and local authorities have their own AST regulations, they are often more stringent than federal rules, such as requiring tank registration or tank permits, but these requirements vary widely. Local fire codes, including the National Fire Protection Association (NFPA 30), also impose design, inspection, and operational standards, but enforcement varies across jurisdictions.
At the core of 40 CFR 112 is the SPCC Plan, which must be developed and implemented by the facility owner or operator, certified by a Professional Engineer (PE), and then approved by the EPA. These plans rely heavily on the engineer’s professional judgment to establish adequate checks and balances to prevent releases to the environment as defined by 40 CFR 112. In contrast to the requirements under 40 CFR Part 280 for UST systems, Part 112 does not mandate UDC installation, scheduled pressure testing, or regulator-led inspections and enforcement for systems installed after April 11, 2016. As a result, compliance under Part 112 depends on the facility’s SPCC Plan, self-inspections, and whether maintenance or equipment replacement is performed at the owner's or operator's discretion. Table 1 provides a side-by-side comparison as summarized by 40 CFR part 112 and 280.
Table 1—Side-by-side comparison: 40 CFR Part 112 vs. 40 CFR Part 280 Secondary Containment Focused at UDC.
UDC Failures & Cleanup Exposure
Most people do not realize how complex the fuel-dispensing system is when they refuel their own vehicle. The dispenser itself is one of the most common sources of fuel leaks, which can contaminate soil and groundwater and lead to costly cleanups. Depending on the extent of the release, remediation expenses can range from thousands of dollars to hundreds of thousands, and in some cases, even exceed a million dollars.9 These costs are typically covered by owners and operators, and although not required by 40 CFR Part 112 for ASTs as it is for commercial USTs under 40 CFR Part 280, specialized tank or site pollution insurance can be purchased to help pay for the cleanup.
My review focused specifically on the UDC installed beneath the fuel dispensing area at a high-volume, high-frequency fuel service station. The UDC, which is located underground, is not visible to the public. The equipment below grade is designed to detect and prevent leaks beneath the dispenser. Due to the high frequency of dispenser leaks and elevated cleanup costs, as of April 11, 2016, the EPA requires all new and replacement UST systems to have UDC secondary containment below the dispenser. These systems must have a liquid-tight basin beneath them to catch leaks from dispensers and connecting pipes. The EPA also requires visual inspection, accessibility, periodic leak testing (every 3 years for single-walled systems or continuous monitoring for double-walled/monitored systems), and compliance with UST regulations (40 CFR Part 280).10
Figure 1—The left image illustrates the aboveground dispenser. Highlighted in green is the UDC. The image on the right shows a generalized cross-section of the UDC, with a flex fuel line, a leak detection sensor, and a penetration fitting located inside the UDC (Source: Veeder-Root).
Within the UDC, there are penetration fittings where fuel and electrical lines enter the containment area below grade, as well as a sensor designed to detect the presence of fuel or water. When operating properly, this equipment alerts the operator to a suspected leak in the UDC when the sensor detects fuel. Penetration fittings ensure that any leak is contained within the UDC rather than migrating through the penetration fitting into the surrounding soil, as shown in Figure 1.
UDC fittings, sensors, and flex fuel lines degrade over time, especially older components, which typically last 5 to 10 years11 (depending on the materials used and conditions inside the contaminant). Degradation is compounded by maintenance factors and conditions inside the UDC, such as water and chemical exposure. A substantial challenge exists for fuel system owners and operators to consistently inspect, test, and, when required, replace essential equipment components, including those located below ground, which are prone to leakage over time and not always easily accessible for observation. Figure 2 illustrates a double-wall secondary containment pipeline, penetration fittings, test boots, and the stainless-steel braided fuel flex line housed inside the UDC – the components that often fail inside the UDC.
Figure 2—The image to the left illustrates the fuel pipeline and penetration fitting, including the electrical conduits; the image to the right shows the stainless steel braided flex line that carries fuel to the aboveground surface fuel dispenser (Source: Tanknology).
While most fuel service stations now use advanced UST systems built from high-performance, modern materials and equipped with computerized leak detection and spill-prevention technology, ongoing oversight remains critical. These systems require active monitoring and visual inspections of the UDC at least once a month to verify proper operation and reduce fuel leaks and potential environmental impacts.
For example, at an AST site, water accumulated in the UDC, accelerating the deterioration of the fuel and electrical penetration fittings and the corrosion of the fuel flex line. This went unnoticed because the operator failed to follow the monthly inspection requirements specified in the SPCC Plan, which mandated opening the UDC, conducting a visual inspection, performing testing/monitoring, and replacing components as needed.
Because these inspections were not performed, the flex fuel line inside the dispenser was never replaced or identified as leaking. The problem was compounded by the fact that the fuel dispenser’s leak detection sensor was not installed at the bottom of the UDC, which would have provided an alert that fuel was accumulating. Even worse, the penetration fittings were cracked and broken but were never closely examined or tested, allowing fuel to escape from the UDC into the environment for several months before it was finally detected in a monitoring well.
As noted earlier, without regular inspections and timely corrective actions, tank appurtenances and fixtures can become major sources of underground petroleum contamination. In this case, the failure to properly inspect and maintain these components resulted in a multi-million-dollar cleanup of the environmental media surrounding the tanks not to mention thousands of dollars in business interruption.
Although the leak detection and spill prevention components used with AST dispensers are often functionally the same as those used in UST systems, AST facilities typically address these elements through SPCC Plans rather than through the prescriptive requirements of UST regulation under 40 CFR Part 280. These regulations do not apply to AST systems, even though many of their components are underground and serve as anti-leak measures.
Standard of Care & Regulatory Disparities
The regulatory standards for underground components associated with USTs and ASTs differ, even though the equipment used below ground can be identical. Commercial USTs, which are usually used for fuel dispensing at gasoline stations, are subject to the more stringent requirements of 40 CFR Part 280, while ASTs, which are usually associated with bulk oil storage facilities, are subject to the less rigorous provisions of 40 CFR Part 112, even if the AST is dispensing fuel through underground piping and a fuel dispenser system.
Under Part 280 federal UST regulations, facilities must conduct frequent evaluations of critical containment equipment such as UDC, spill buckets, and other sumps, perform mandatory personnel training and certification, conduct monthly walkthrough inspections by a certified operator, undergo implementing-agency inspections at least every three years, and complete triennial pressure testing of the UDC and other sumps installed after April 11, 2016.
In contrast, AST systems regulated under Part 112 do not have comparable federally mandated inspection or testing requirements for underground components, such as UDCs. Instead, facilities rely on SPCC Plans, certified by a Professional Engineer, which prescribe facility-specific daily, monthly, and annual inspections that are self-implemented rather than regulator-enforced.
As a result, underground components associated with an AST may receive significantly less oversight, testing, and timely replacement than identical components installed in a UST system, even when the AST uses the same UDC design and piping configuration.
The differences in these regulatory requirements can result in a standard of care issue; namely, whether AST owners should be held to the same standard of care as UST owners, even though the AST regulations are less stringent. As stated previously, in many cases, AST dispenser equipment is identical to UST equipment, so if AST owners fail to adopt UST-comparable inspection and testing practices, is it a violation of the standard of care? As seen in the field, failure to comply with the UST standard of care increases the likelihood of undetected environmental pollution releases at AST sites. This obviously can lead to unwanted and expensive losses, claims, business interruption, regulatory violations, and litigation. Thus, from a risk management perspective, an argument can be made that all underground fuel pipelines and dispensing systems in both AST and UST systems should comply with the more stringent requirements under 40 CFR Part 280 as the industry standard of care to help avoid these unwanted risks.
References
UST Regulations & 2015 Revisions – EPA overview of the 2015 rule changes to 40 C.F.R. Part 280: Revising Underground Storage Tank Regulation – 2015 Rule
UST O&M Requirements – Walkthrough inspections and O&M details: https://www.epa.gov/ust/operating-and-maintaining-ust-systems-2015-requirements" \t "_blank"
UnderDispenser Containment (UDC) – Installation and performance criteria: Secondary Containment and UnderDispenser Containment – 2015 Requirements
UST Operator Training (A/B/C) – Minimum training requirements and resources: Operator Training – Minimum Requirements, Musts for USTs
Regulator Inspections (EPA 2005) – At least once every three years: Inspecting Underground Storage Tanks – Energy Policy Act
State Program Approval (SPA) – Current counts and status: UST Program Facts (May 2024), State UST Programs
SPCC Overview & Thresholds – 40 C.F.R. Part 112; 1,320/42,000gallon thresholds and program scope: SPCC Regulation Overview, SPCC “Blue Brochure”
SPCC PE Certification / Qualified Facilities – Plan requirements and self-certification where eligible: SPCC Basics Presentation, Spill Prevention, Control, and Countermeasure (SPCC) for the Upstream (Oil Exploration and Production) Sector | US EPA
SPCC Requirements for Transfer Areas - SPCC requirements for transfer areas associated with exempt USTs | US EPA
112.7 General requirements for Spill Prevention, Control, and Countermeasure Plans - eCFR :: 40 CFR 112.7 -- General requirements for Spill Prevention, Control, and Countermeasure Plans.
UST Frequently Asked Questions - Frequent Questions About Underground Storage Tanks | US EPA
KAS - How Long Do Flexi Pipes Last? | KAS
1 eCFR :: 40 CFR Part 280 -- Technical Standards and Corrective Action Requirements for Owners and
Operators of Underground Storage Tanks (UST)
2 Spill Prevention, Control, and Countermeasure (SPCC) for the Upstream (Oil Exploration and
Production) Sector | US EPA
3 Revising Underground Storage Tank Regulation – Revisions to Existing Requirements and New
Requirements for Secondary Containment and Operator Training; Final Rule | US EPA
4 Operating And Maintaining UST Systems - 2015 Requirements | US EPA
5 • Compliance advisory about testing and inspection requirements in 40 CFR Part 280.35 – periodic
testing for spill prevention equipment, containment sumps, and overfill prevention equipment
6 Secondary Containment and Under-Dispenser Containment - 2015 Requirements | US EPA
7 Operator Training - Minimum Training Requirements and Training Options | Underground Storage Tanks
(USTs) | US EPA
8 eCFR:: 40 CFR 112.7 -- General requirements for Spill Prevention, Control, and Countermeasure Plans.
9 Frequent Questions About Underground Storage Tanks | US EPA
10 Secondary Containment and Under-Dispenser Containment - 2015 Requirements | US EPA
11 How Long Do Flexi Pipes Last? | KAS
