Canada has seen many significant improvements in oil heat storage systems over the past decade . Among the biggest is a new installation standard that promises to help reduce the number of costly oil spill claims for insurers .

Ten years ago , the heating oil industry in Canada was increasingly dealing with the negative fallout of spill and leaks from heating oil storage systems . Homeowners were experiencing significant damage to their homes due to oil leaks ; insurers were paying millions of dollars in claims with no signs of improvement in area of safety regulations .

For years , Insurance Bureau of Canada ( IBC ), an association representing Canada ’ s home , car and business insurers , appealed to provincial governments to step in and regulate the industry . The idea was to create safety standards for oil storage that would lead to a reduction in spills .

Back in 2009 , I pointed out in an article published in Canadian Underwriter that data from the province with the toughest regulation , Prince Edward Island , was not showing any improvement compared to non-regulated provinces .

Regulating an industry when you don ’ t understand what ’ s going wrong wasn ’ t leading to the desired result , which was fewer claims . And so , the tack changed : Key stakeholders committed to collecting failure data and determining what was going wrong . Then they would look to a national technical code committee to recommend solutions .

IBC spearheaded a massive study in 2008 to determine the cause of oil leak claims for its members . Four years later , the insurers ’ association presented its data to the Canadian Standards Association ( CSA ) B139 technical committee in Montreal . Comparing the IBC data with 10 years of PEI spill data , the results were essentially the same : 85 % of the heating oil system failures and 91 % of the overall claim costs were associated with tank systems installed outside the home . Only 15 % of heating oil system failures and 9 % of claim costs were associated with tank systems installed inside the home .

Armed with the IBC ’ s data , the PEI government , the Canadian Coast Guard , and the CSA B139 technical code committee worked to identify cost-effective solutions for addressing the common failures for storage systems located both inside and outside the home .

For the 2015 CSA B139 code edition , the CSA committee came up with a number of code changes to address all of the key areas where deficiencies in the design and / or equipment had led to a failure . The new standard , CSA B139-15 , significantly changed the requirements for oil storage installations both inside and outside the home .

For tanks located outside , it called for more robust foundations , double-bottom steel tanks and / or fibreglass construction , and no more copper lines at the bottom . Copper lines need to be top draw or large steel / flexible stainless-steel pipes can be used on bottom draws .

As for inside installations , tanks must be placed in speciallydesigned containment trays , regardless of the tank type ( this is for overfill and connection protection ).

Filters need containment protection and must be corrosionresistant . Oil burners can be fitted with specially-designed containment devices where filters are typically installed . In addition , the entire inside oil tank system can be protected with secondary leak detection alarms , which act like smoke detectors should a leak occur .

Given all of the enhancements to the installation standard — including vastly improved storage tanks , filters , lines , containment systems , and leak detection alarms — the oil storage system today is vastly different than it was even before 2015 . The risk of a damage claim today from a tank system installed according to this new standard has been almost entirely eliminated .

Oil heat is still one of the most economical and practical sources of space heating in urban and rural areas where natural gas is not served . Propane is a great cooking fuel , but it ’ s very expensive to use for space heating . And it must be sourced almost entirely from rail cars — something that has proven to be a challenge based on the limited storage capacity and the problems moving petroleum by rail . Heating oil ( diesel ) on the other hand does not suffer from these challenges and plenty of storage capacity exists .

A couple of important notes to insurance companies who underwrite this business :

• Communicate to homeowners that the best location for their oil storage system , if at all possible , is inside the home . This takes Mother Nature and vandalism out of the risk equation .

• It ’ s very important to communicate to the homeowner that the CSA B139-15 installation code is the minimum installation standard . Follow up and request pictures of the new installation to make sure it is installed correctly and to code . Some unscrupulous contractors may cut corners to get the business , while other bad actors may even ignore the codes completely .

Make it clear to the homeowner to check the final installation . The P & C industry has achieved its goal of having provincial governments regulate the installation of oil heat systems .

The only thing left to do is for provincial governments to adopt and enforce the latest code standard .

Data collection was the key to making this happen . IBC is reporting that claims are continuing to decline significantly .

As oil heat systems get replaced with the new standard , the incidents should pretty well disappear . l FON

Michael Freill is president of Mark 1 Engineering Ltd ., in Dartmouth , Nova Scotia .

16 OCTOBER 2021 | FUEL OIL NEWS | www . fueloilnews . com