Wednesday, July 16, 2008

PMAA's Thoughts on Ethanol by Pipeline: Think About it First

PMAA reports an advisory on ethanol by pipeline.

When thinking about biofuels and market subsidies its always fair for the biofuels industry to point out that there are large barriers to entry which raise the cost of operating a biofuel distribution business. One of the largest of these being access to the most efficient transportation mechanisms used by the biofuels industry. Namely pipelines and barges.

As fuel prices rise and the fungible considerations of ethanol and biodiesel as blendstocks for refined petroleum products the need for barges and pipelines to allow the movement of ethanol and biodiesel blends becomes much more significant. Though South American nations have been moving ethanol by pipeline for decades the US market is hesitant (probably because of issues South American markets saw decades ago). This conversation though is positive for ethanol in particular.

See the PMAA's news piece below:

The U.S. DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) has issued an advisory to pipeline operators on the potential dangers of transporting ethanol and biofuels by pipeline.

PHMSA advised pipeline operators that the transportation of batches of ethanol or other biofuels, including petroleum blended product in existing pipelines, may lead to internal corrosion, stress corrosion cracking, and a reduction in the performance of seals, gaskets and internal coatings. PHMSA advised pipeline operators to conduct risk analysis, monitoring, and controls as needed to move ethanol and biofuels safely through pipelines.

PHMSA is also requesting that pipeline operators conduct spill response planning for ethanol and bio-fuels products. The advisory said that PHMSA is willing to work with pipeline operators that plan to transport ethanol and bio-fuels in existing or new regulated hazardous liquid pipelines in order to better assess the risks these fuels pose to critical infrastructure.

PHMSA is asking pipeline operators for 60 days notice of intent to begin regular commercial transport of biofuels in pipelines. PHMSA asked pipeline operators to provide information on how pipelines will be prepared for ethanol and biofuel service, the anticipated blend concentration and batch frequency, additional emergency response planning and spill response plan revisions required, and plans for ongoing monitoring of pipes.

PHMSA said it will use the notice period to conduct a technical review of the operators' plans and provide feedback if necessary.

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