Reducing Your Liability by Choosing a Proper Partner for Disposal of PCB-Contaminated Materials (Part I)

November 11, 2013

When it comes to unwanted transformers and PCB-contaminated material, every power generation and distribution company-from rural electric companies to electrical contractors to large electric utility companies-knows that “cradle to grave liability” is always a concern when it comes to picking a transformer disposal partner. But what is “cradle to grave liability” and what does it mean for you? There are three things every power generation and distribution company should know about a disposal company before they choose them as a partner.

 

  1. The disposal company should follow detailed, recorded operating procedures at all times
  2. They should have insurance or assets enough to cover incidents, spills, or contamination
  3. They should have a funded closure plan for the facility.

 

When it comes to transformer disposal, the phrase “cradle to grave liability” means that your company essentially owns a piece of the disposal company’s liability. And here’s why:

 

The Comprehensive Environmental Response Compensation and Liability Act (CERCLA) is a U.S. Federal law designed in part to collect any financial resources necessary to clean up abandoned sites that have been contaminated by hazardous substances. This is important to know. If, for any reason, the disposal company you contract with to dispose of your unwanted electrical equipment goes bankrupt after a contamination incident, this law may hold your company liable for a percentage of the resulting cleanup costs. The only way you can minimize your risk of financial liability comes from contracting with a company that follows highly-detailed operating procedures, as well as all applicable environmental laws, and is financially stable enough to afford a cleanup in the event of an incident. And this is exactly why “cradle to grave liability” is not a rumor. The liability is very real.

 

In the years before Polychlorinated Biphenyls (PCB) use was outlawed, many of the transformer manufacturers that used PCB fluid didn’t think much about residual contamination as part of the end-of-life disposal or storage concern. The responsibility of generators under CERCLA changed all this. In the event of a spill or an incident that introduces PCBs to the environment, the only protection you have comes from contracting with a financially stable disposal company that strictly adheres to environmental laws.

 

How can you be sure that your disposal company meets the standards?

As the disposal company client, you have the right to ask for details and perform inspections of their waste items. Smaller utility companies may not know this. But, given that you own a piece of the liability from every disposal company you contract with, you have a right to know exactly who you are dealing with. You have the right to ask about your disposal company’s financial records or to schedule a visit to the disposal plant you’re considering. You have the right to look over their entire operation and see how potentially-contaminated material is moved throughout the facility.

Perform your own inspection. Visit the disposal company and take the time to notice if their facility is clean and well-organized. Can you spot dusty piles of scrap material here and there, which might indicate delays in processing? Are there any oil spots inside or signs of leaks inside or outside the facility? Is there any standing water in or around the premises that has an oil sheen on the surface? Are the employees working without the correct personal protection equipment (Tyvek suits, sturdy gloves and boots)? If the answer to any of these questions is “yes,” that’s a sign that the disposal company may be disorganized or failing to follow all precautions. And it may be a sign of a future liability for your company.