Reduce VOCs from Petroleum Storage and Loading

Summary#

The Canada Gazette published a proposed rule called the Reduction in the Release of Volatile Organic Compounds (Storage and Loading of Volatile Petroleum Liquids) Regulations on February 24, 2024. It would require many petroleum storage tanks and loading racks to add vapour-control equipment, inspections and reporting; the government says the proposal would cut about 494 kilotonnes of volatile organic compounds (VOCs) and about 8 kilotonnes of methane over 2024–2045. The proposal is not law yet — there is a 60‑day comment period after publication.

What it does#

• Requires terminals, refineries, upgraders, petrochemical facilities and some bulk plants to install and operate emissions control equipment (vapour recovery/destruction systems, floating roofs, pressure-vacuum vents) on tanks and loading racks.
• Sets inspection, testing and repair schedules (monthly, annual and longer inspections) and timelines for fixing defects; allows short-term temporary controls while repairs are done.
• Requires standard sampling and testing methods, record‑keeping and annual reporting to the federal government.
• Creates a permitting route for some alternative controls and limited exemptions for very small or remote sites (for example tanks under 4 m3 are excluded; other small thresholds and distance rules apply).
• Uses a phased compliance schedule: new tanks/racks must comply when first used; many existing high‑risk items would be prioritized and most high‑emitting loading racks and the highest‑risk tanks are expected to be brought into compliance by the end of 2027, with full compliance required by 2031 under the proposed timelines.
• Includes an option for existing internal floating‑roof tanks to get a permit to remain with that technology if strict fenceline benzene monitoring shows low concentrations.

Who's affected#

• Operators of petroleum storage and loading sites: petroleum liquid terminals, crude and primary terminals, refineries, upgraders, petrochemical facilities and larger bulk plants. The proposal analysis uses a national inventory of about 243 such facilities.
• Workers at those sites (inspection and maintenance crews) and nearby residents. Health concerns are highlighted for sensitive groups such as children, pregnant people and people with respiratory disease.
• Indigenous communities and groups near facilities. The departmental analysis mentions engagement with groups including the Aamjiwnaang First Nation, the Tsleil‑Waututh Nation, and Inuit Tapiriit Kanatami. Some northern/remote fuel distribution sites may be excluded to avoid disrupting local fuel supplies.
• A small number of small businesses — the analysis estimates about 3 small businesses could be affected.
• Consumers: the departments estimate the maximum short‑term possible pass‑through to gasoline prices at about $0.0025 per litre in the 2026–2030 period (roughly $2.85 per person per year nationally and up to $4.40 in higher‑use provinces like Saskatchewan), though actual impacts are expected to be smaller.

If any of the above is unclear in the source, that uncertainty is noted by the departments (for example, exact locations of some bulk plants were not fully known and some health benefits from reduced benzene were not monetized).

Why it matters#

• Health: the rules target VOCs that form smog (ozone and PM2.5) and specific carcinogens such as benzene. The government’s modelling estimates air-quality improvements that could prevent about 150 premature deaths and produce an estimated $1.05 billion (present value) in health benefits over the analysis period.
• Local air quality: many storage and loading sites sit close to towns and Indigenous communities. The proposal aims to reduce short‑term spikes of benzene and other emissions that local monitoring has linked to elevated exposures in some communities.
• Climate and product recovery: reducing fugitive VOCs also cuts methane slightly (about 8 kt over the analysis period) and allows recovery of lost product. The departments estimate production value from recovered product at about $343 million, and a climate benefit estimate of about $24.3 million (present value).
• Costs and trade‑offs: the departments estimate total compliance and government costs of about $1.09 billion (present value) and total quantified benefits of about $1.43 billion, yielding a modeled net benefit of about $337 million. Some benefits (notably reduced cancer risk from benzene) could not be monetized and are therefore not fully reflected in the dollar totals.
• It is a national, equipment‑based approach intended to fill gaps where provincial, municipal and voluntary measures are uneven — meaning more consistent protection across Canada if adopted.

If you want to see the full proposal text or submit comments, the Canada Gazette notice gives the details (publication February 24, 2024) and the 60‑day comment window.