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July 7, 2011 | Vol. 61, No. 14

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In This Issue
Dear PEI Member:

The United States Environmental Protection Agency (EPA) published final guidance in the July 5 Federal Register for owners and operators of underground storage tanks (USTs) storing gasoline blends containing more than 10 percent ethanol and diesel blends containing more than 20 percent biodiesel. EPA issued a prepublication version of the rule June 23 (see June 30 TL).

Federal law―specifically 40 CFR §280.32requires UST systems to be compatible with the substance stored. EPA anticipates some tank owners may choose to store blends of ethanol higher than E10 in their legacy UST systems when these fuels―particularly E15―become available. Since the chemical and physical properties of ethanol and biodiesel can be more degrading to certain UST system materials than petroleum alone (E0 to E10), EPA's Office of Underground Storage Tanks (OUST) published draft guidance last year to help tank owners comply with the federal compatibility requirement. The action taken by EPA in the July 5 Federal Register finalizes that guidance.

To whom does the guidance apply? 40 CFR Part 280―and therefore this guidance―applies in Indian country and in states and territories (referred to as states hereafter) that do not have state program approval (SPA). EPA explains that although the guidance is not binding on SPA states with approved UST programs, those states may find the guidance relevant and useful because SPA states have a compatibility requirement that is similar to the federal compatibility requirement. In order for EPA to approve a state's program, that state's regulations must be at least as stringent as the federal UST regulations.

UST system components covered. For the purpose of this guidance, EPA considers the following components to be critical for demonstrating compatibility:

  • Tank or internal lining
  • Piping
  • Line leak detector
  • Flexible connectors
  • Drop tube
  • Spill and overfill prevention equipment
  • Submersible turbine pump and components
  • Sealants (including pipe dope and thread sealant), fittings, gaskets, o-rings, bushings, couplings and boots
  • Containment sumps (including submersible turbine sumps and under-dispenser containment)
  • Release detection floats, sensors and probes
  • Fill and riser caps
  • Product shear valves

EPA did not include vapor recovery equipment because these components do not routinely contain liquid product. And although many commenters to the proposed guidance strongly recommended EPA include dispensers on the list, EPA does not regulate aboveground equipment, such as dispensers, under 40 CFR Part 280.

For newly installed equipment comprised of multiple individual components such as submersible turbine pump assemblies, UST system owners and operators may obtain a certification from the equipment manufacturer (see discussion that follows) documenting compatibility for the entire assembly. If the equipment requires maintenance―and components of that equipment (for example, seals and gaskets) are subsequently added or replacedmanufacturer approval of the overall component is not sufficient to demonstrate compatibility. EPA points out that "it is important for tank owners to use compatible replacement parts."

Options for Meeting the Compatibility Requirement. Acceptable methods for owners and operators of UST systems to demonstrate compatibility under 40 CFR §280.32 are:

  1. Use components that are certified or listed by a nationally recognized, independent testing laboratory (for example, Underwriters Laboratories) for use with the fuel stored;
  2. Use components approved by the manufacturer to be compatible with the fuel stored. EPA considers acceptable forms of manufacturer approvals to:
    • Be in writing;
    • Indicate an affirmative statement of compatibility;
    • Specify the range of biofuel blends the component is compatible with; and
    • Be from the equipment manufacturer, not another entity (such as the installer or distributor); or
  3. Use another method determined by the implementing agency to sufficiently protect human health and the environment.
EPA Publishes UST Guidance

PEI Distributor Profitability survey deadline July 15

Indiana DOT Moves to Propane


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EPA's guidance says that if the UST owner and operator is not able to demonstrate that the UST system is made of materials that are compatible with the biofuel blend stored, according to 40 CFR §280.32, the UST owner and operator may not use the system to store those fuels.

Impact on PEI members. Many UST system components in use today, with the exception of certain tanks and piping, have not been tested by UL or any other nationally recognized, independent testing lab for compatibility with ethanol blends greater than 10 percent. In addition, EPA is not aware of any nationally recognized, independent testing lab that has performed testing on UST system components with biodiesel-blended fuels. As a result, tank owners and operators wishing to store ethanol blends greater than 10 percentand biodiesel blends greater than B20in any of the approximately 600,000 UST systems in use in the United States will likely turn to the manufacturers of the equipment to see if their legacy equipment is compatible with what they want to store in it.

EPA concluded "that equipment manufacturers are uniquely suited to attest to the compatibility of their products and have an incentive to make truthful claims regarding use of their equipment with biofuel blends." Further, EPA explained, "the manufacturer option is critical for components that do not have a certification or listing by a nationally recognized, independent testing laboratory." 

Commenters to the proposed guidance were concerned because instances could occur in which a certification or listing from a nationally recognized testing lab was not available at the time of manufacture, and the manufacturer either is no longer in business or is unwilling to certify that the component is compatible. EPA recognized this possibility, but concluded that it "can not accommodate this situation while minimizing the risk to the environment." Therefore, under this guidance, "if tank owners are not able to demonstrate compatibility, they would not be able to store ethanol blends greater than 10 percent or biodiesel blends greater than 20 percent in the UST system."

Once E15 is permitted for sale, we believe that manufacturers of the UST components identified by EPA in the guidance will be asked by tank owners, equipment distributors and UST system installers for an affirmative statement of approval for the equipment manufactured years ago. In some cases the statement may be simply confirming a UL listing. In other cases, manufacturers will provide approvals in the form required by EPA. And, as noted above, in some instances manufacturers will simply not be able to provide the approvals required to store the biofuel.

It occurs to us that it might be helpful if the industry had one place to go to access manufacturers' equipment approvals for biofuels. PEI's website could be that place. Let me ( know what you think about this idea.

Each year, PEI distributors have the opportunity to participate in the PEI Distributor Profitability survey, a detailed review that benchmarks company financial statements to industry norms in expenses, gross margin and employee productivity.

The survey―which is free to all participants―consistently ranks as one of the most valued of all members benefits. The information is compiled by a third party and treated with complete confidentiality. The deadline for participation has been extended to July 15 to allow additional members to participate.

If you are a PEI distributor member and would like to participate in the survey, please contact Chris Bouldin at (918) 494-9696, ext. 964 or Additional details, including instructions on how to submit your information, are included in the questionnaire.

National Oilwell Varco said it plans to buy out Ameron International for around $770 million, or $85 per share―a 28 percent premium to its July 1 closing price. NOV chief executive Pete Miller said the acquisition would allow NOV to expand "into seawater handling systems in new oil and gas drilling and FPSO vessels."

PEI invites members to greet and assist attendees in finding their way around the convention center in Chicago. Each Find Red volunteer works a few hours and helps in areas such as registration, bus drop-off locations, education sessions and receptions. Volunteers are provided a "Find Red & Find PEI" vest to wear during the scheduled volunteer times that run Sunday through Tuesday, October 2-4. For more information or to volunteer, visit our Find Red & Find PEI page or contact Carletta Denision at

"Indiana's DOT is converting 527 of its work trucks and vans to run on domestic propane, which it says is cheaper and cleaner-burning. INDOT expects to replace 500,000 gallons of unleaded gasoline with propane during the fiscal year beginning July 1, saving more than $1 million.

"The state used a federal grant to convert some of the vehicles and to install 115 refueling facilities. Indiana now has the nation's largest public statewide propane fueling network, says spokesman Will Wingfield. Indiana also is purchasing 19 new snowplows that will run on compressed natural gas; initially, they will be used primarily in the Indianapolis area. Those vehicles will net the state a savings of up to $100,000 a year, Wingfield says."USA Today, June 27, 2011.

Vancouver-based Westport and General Motors announced plans last week to develop a natural gas engine technology for light motor vehicles in a move to reduce dependence on conventional fuels.
The Nebraska and Iowa Clean Cities Coalitions have selected Kearney (NE), Omaha (NE), Des Moines (IA) and Ames (IA) as pilot communities to introduce electric cars and charging stations.

D&H/United Pump has hired Jasun Harmon ( as construction manager in its Schertz, Texas, office. The company also welcomes back Andrea Silva as its new geologist/environmental marketing representative. Based in El Paso, she can be reached at

Dispenser security alarm manufacturer
. Flint Loc LLC, P. O. Box 198, Philo, Ohio 43771, has applied for manufacturer division membership. David Jacobs is the national sales manager for the firm, which was established in 2006. The company manufactures dispenser security alarm systems to stop fuel theft and prevent intrusion into pumps. The systems are sold through PEI distributors. Sponsored for PEI membership by Ray Swonger, R-JSlsAscs, Greensboro, GA.


  • TankScan, Big Lake, MN (mfr)
  • Encore Commercial Products dba Post Guard, Southfield, MI (mfr)
  • Sartomer USA LLC, Exton, PA (aff)
  • IDECO Inc., Orange, CA (S&C)
  • Barker Lemar Petroleum Services, West Des Moines, IA (S&C)
  • Petroleum Equipment Service of New Hampshire, Manchester, NH (S&C)


  • Petroleum Equipment Service, Inc., Kerrville, Texas, from the Service and Construction Division to the Distributor Division of PEI


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Petroleum Equipment Institute
P. O. Box 2380
Tulsa, OK 74101-2380

The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Robert N. Renkes, Executive Vice President, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.