DEADLINES FOR REMOVAL OR UPGRADE OF ONTARIO'S
FUEL OIL STORAGE TANKS FAST APPROACHING
By Terrance S. Carter, B.A., LL.B.
Assisted by Nancy E. Claridge, B.A., M.A., LL.B. and Derek
B.M. Ross, LL.B. Candidate
For more than sixty years, fuel oil storage
tanks have been installed and used in properties owned by
Ontario charities, in particular churches, synagogues, mosques
and other religious organizations, including residences for
their spiritual leaders. In addition to the rising cost of
fuel to heat these charitable facilities, owners of properties
with fuel oil storage tanks should be aware of the fast approaching
deadlines contained in Ontario's strict regulations that may
require the fuel oil storage tank to be upgraded or removed.
Some requirements may be particularly onerous for small charities,
particularly some charities with aging facilities, but the
potential for significant liability should there be a leak
into the environment makes it an issue that charities in Ontario
cannot ignore. This Charity Law Bulletin looks at recent
developments regarding requirements for the proper management
of fuel oil storage tanks in Ontario.
B. LEGISLATIVE BACKGROUND
The handling and storage of fuel oil is governed
by Ontario Regulation 213/01 - Fuel Oil (the "Fuel
Oil Regulation"), which supplements the Technical
Standards and Safety Act, 2000.1
The Regulation identifies two kinds of fuel oil storage tanks:
aboveground fuel oil storage tanks and underground fuel oil
storage tanks, defining them as follows:
If the distributor finds or is informed that
the fuel oil storage tank is in an unacceptable condition
but is not an immediate hazard, the distributor must notify
the operator with a description of the condition and a notice
that the distributor will cease supplying fuel oil until the
condition is corrected. Similarly, such written notice must
be affixed to the fuel oil storage tank and a copy forwarded
to the TSSA.8 The distributor cannot give more than 90 days
for the condition to be corrected. If the condition is not
corrected within the time specified in the notice, the distributor
cannot supply fuel oil to the fuel oil storage tank.
Contractors (i.e. a person who installs, removes,
repairs, or services fuel oil appliances) have a similar duty
in such situations.9
D. UNDERGROUND FUEL OIL STORAGE TANKS
All underground fuel oil storage tanks must
be registered with the TSSA. Failure to register an underground
fuel oil storage tank results in the inability of the supplier
to provide fuel.10 There is
no charge for registering an underground fuel oil storage
tank, and applications are available online through TSSA's
After the application for registration is processed,
the applicant will receive written notification that the fuel
oil storage tank is registered with TSSA with its own unique
registration number. This registration number should be provided
to the fuel oil distributor in order to prevent potential
disruptions in delivery.
Property owners wanting to abandon an underground
fuel oil storage tank must submit an application for a Variance
to TSSA. Again, application forms are available on TSSA's
website. Upon submitting such an application, TSSA will determine
whether the underground fuel oil storage tank must be removed,
or whether it can remain in place with conditions. Similarly,
once use of an underground fuel oil storage tank has been
permanently discontinued, the fuel oil storage tank must be
removed by a qualified TSSA registered Petroleum Mechanic
2 ("PM 2").12 Owners
can only install or remove underground fuel oil storage tanks
if they receive approval through a variance technical review
process by TSSA.
One of the biggest areas of concern for owners
of fuel oil storage tanks is the possibility of leaks. Many
metal fuel oil storage tanks rust from the inside out, often
occurring due to the accumulation of condensation inside the
tank. As the fuel oil floats on top, the water is able to
slowly corrode the base of the tank until fuel oil is able
to leak out.13 For owners of
aboveground fuel oil storage tanks, this may only be a minor
inconvenience, requiring fuel to be cleaned from the basement
floor. More significant damage, of course, can occur should
the fuel oil get into the drain and be pumped over larger
areas, requiring a major environmental cleanup. For owners
of underground fuel oil storage tanks, a leak will almost
always result in significant environmental damage, such as
impacting sewer, oil, surface water and groundwater systems,
and in most circumstances the damage is greater because the
underground fuel oil storage tank has been leaking for many
years without it notice. For charities facing such a problem,
this may result in both the charity and its directors being
found liable for the cost of clean-up of the contamination,
as well as damages suffered by adjoining land owners.
If an underground fuel oil storage tank is leaking,
the owner must call a PM 2 to repair the leak, and the Spills
Action Centre of the Ministry of Environment and Energy must
also be notified of the spill incident.14 The contractor and
the owner's insurance company may assist in the clean up that
is required and for which the owner is responsible. Fuel oil
storage tanks with a capacity of over 5000 liters need to
be leak-tested annually.
Due to the potential for an underground fuel
oil storage tank to result in a fuel oil leak or spill, the
TSSA requires all underground fuel oil storage tanks to be
either removed or upgraded with leak and spill-protection
equipment. The deadline for doing so depends on the date of
the fuel oil storage tank's original installation:15
|Age of Underground Tank System
(Years from date of original installation)
|Deadline for Removal or Upgrade
|25 or more (or if unknown)
||October 1, 2006
||October 1, 2007
||October 1, 2008
||October 1, 2009
TSSA advises potential buyers of property to
consider whether there are any underground fuel oil storage
tanks on the property before purchasing it, as the new property
owner may be responsible for removing any such tanks.16 Owners
are also responsible for the maintenance and/or upgrading
costs of an underground fuel oil storage tank, as well as
for those costs associated with cleaning up any contamination.
E. ABOVEGROUND FUEL OIL STORAGE TANKS
The Fuel Oil Regulation provides greater flexibility
for owners of aboveground fuel oil storage tanks. Unlike underground
fuel oil storage tanks, aboveground fuel oil storage tanks
are not required to be registered with the TSSA. However,
the aboveground fuel oil storage tanks must meet certain standards
unless they are grandfathered from previous regulations.17
So long as the aboveground fuel oil storage
tank is not leaking, there is no time limit in which the tank
must be replaced. However, the tank must be replaced if it
was installed after 1971 and does not have an Underwriters'
Laboratories of Canada (ULC) label reflecting its certification.18
Tanks installed prior to 1971, and therefore prior to the
inception of the CSA Installation Code for Oil Burning
Equipment, are grandfathered and deemed approved if the
house was built prior to 1971.
F. OTHER JURISDICTIONS
Regulations concerning fuel oil storage tanks
differ from province to province. For example, in Western
provinces, where the use of fuel oil storage tanks is less
prevalent than in the East, regulations may be found in the
province's fire and/or building code, and individual municipalities
may have their own regulations. Such is the case in British
Columbia. Prince Edward Island, on the other hand, has similar
regulations to those of Ontario. The Petroleum Storage
Tanks Regulation,19 under
the Environmental Protection Act,20
requires contractors to be licensed in order to install, alter
or remove either an above ground fuel oil storage tank or
an underground fuel oil storage tank. Contrary to regulations
in Ontario, both types of fuel oil storage tanks must be replaced
every 15 to 25 years, depending on the tank design and its
thickness, and an underground fuel oil storage tank that has
been out of service for more than one year must be removed.
All fuel oil storage tanks must be registered under the regulation,
and the regulation prohibits fuel oil to be supplied without
a valid registration tag being permanently affixed to the
fuel oil storage tank.
In Nova Scotia, the Petroleum Management Regulations,21
under the Environment Act,22
govern the use of fuel oil storage tanks. The Nova Scotia
regulation has a graduated system for registering, all dependent
on the capacity of the fuel oil storage tank, and requires
that systems be regularly monitored. Fuel oil storage tanks
that have been abandoned for more than 24 months must be removed.
With the differing regulations, it is important
for charities and other property owners to determine those
regulations that apply to their property, while at the same
time being cognizant of developments in other parts of the
country, especially when it comes to preventing environmental
Charities and other property owners in Ontario
with aboveground or underground fuel oil storage tanks must
be aware of the significant regulatory requirements governing
their use and existence. This includes the need for registration
of underground fuel oil storage tanks, the need for regular
inspections, and the owner's liability for any spills. Ontario's
Fuel Oil Regulation is intended to help protect the province's
environment from possible fuel oil leaks by creating a registry
of the location and age of each underground tank in the province
and ensuring that aboveground and underground fuel oil tanks
that are in danger of leaking do not continue to receive fuel
oil. Current and future property owners, including charities
and their boards of directors, are encouraged to determine
the scope of the requirements under the applicable legislation
in order to ensure compliance.
1S.O. 2000, c. 16.
2 Section 1(1).
3 Section 14 of the CAN/CSA-B139-00 Installation
Code for Oil Burning Equipment.
4 This requirement came into effect May 1, 2002.
5 Section 17 (1).
6 Section 1(1).
7 Section 23.
8 Section 24.
9 Sections 25 and 26.
10 Section 7(4). Note that, according to the TSSA
website, "TSSA has advised fuel oil distributors that
unregistered tanks are to be considered non-immediate hazards
and fuel should be provided to clients and notice given to
them to obtain a registration number within a timeframe not
exceeding 90 days."
11 See www.tssa.org.
12 Owners can visit the Ontario Petroleum Contractors'
Association (OPCA) website at www.opcaonline.org
for a list of PM 2s in their area.
13 AmeriSpec of Canada, www.amerispec.ca.
14 Available at 1-800-268-6060.
15 See TSSA's FAQ for underground fuel oil tank
owners at www.tssa.org.
16 To determine a property's history, buyers can
contact the TSSA Records Department at (416) 734-3402 or 1-877-682-8772.
17 Section 1(3) provides that equipment installed
in accordance with predecessor regulations shall be deemed
approved under the current Fuel Oil Regulation so long as
the equipment complied with the predecessor regulation at
the time it was installed.
18 The label is a square or rectangular identification
piece commonly found on the top upper half of a tank. See
19 P.E.I. Reg. EC322/01.
20 R.S.P.E.I. 1988, c. E-9.
21 N.S. Reg. 44/2002.
22 S.N.S. 1994-95, c. 1.