Canada is Cracking the Whip: Tougher Laws for Rail Tank Cars May Happen

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In response to a series of grueling crashes, the Canadian government has made a request that harsher laws be made for rail tank cars that are carrying crude oilSpecifically, this new requirement would mean cars would have to have outer jackets, as well as a layer of thermal protection and thicker steel walls. However, these new standards are more demanding than the oil industry wants.

RELATED TOPIC: The Bad, the Good, and Other Effects of Declining Oil Prices for Canada 

The Specific Change in Standards

U.S. officials have been working rather closely with Canada to finalize regulationswhich should be completed by May. At that time, the White House will review the draft proposal. Though this proposal won’t include the ongoing issue with electronically controlled brakes, new standards will require a hull thickness of 9/16th of an inch, which is up from 7/17th of an inch. As stated above, thermal jackets will also be mandatory.

Since February, there have been four oil train derailments in the United States and Canada. According to the U.S. Transportation Department, trains carrying crude oil or ethanol will derail an average of 10 times a year over the next 20 years, causing around $4 billion in damages and potentially killing hundreds. Therefore, there is pressure from Transport Canada for the new standards to be completed and finalized as soon as possible. 

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Change for the Industry

Though new requirements would call for thicker tank walls, the oil and rail industries want the complete opposite—thinner walls. Instead of the proposed 9/16ths-inch that is being requested, the industry wants tank walls to be just a half an inch thick. What’s the reason behind the desire for thinner tank walls? When a wall or shell is thicker, the amount of oil that can be held by a tank car lessens. Therefore, costs can add up, resulting in the loss of money. However, what’s more important: money or human safety?

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