Transporting hazardous materials (hazmat) is a profitable but challenging undertaking. In addition to the steps necessary to keep drivers and others on the road safe, it involves extensive, often inefficient, regulatory considerations. A new rule might alleviate some of these concerns.
On October 7, 2024, the Department of Transportation (DOT) announced a proposed rule to modernize and simplify hazmat shipping compliance. While the updated regulation may still undergo rewrites and modification before becoming law, it promises significant changes for the shipping industry.
Proposed Hazmat Rules
The proposed hazmat rule focuses mainly on tanks carrying fuels like gasoline and diesel. Many of the specific changes within it reduce the requirements necessary to work with and transport these vehicles. That includes allowing a wider range of professionals to perform inspections and reducing the time such reviews take.
Suggested amendments also cover the switch to electronic registration practices. As many as 86% of supply chain organizations already use cloud computing or will do so within the next few years. The government switching over to a similar platform could significantly streamline the process of registering hazmat vehicles and related workflows.
Similarly, the new rules simplify labeling requirements and clarify many definitions within existing regulations. Such edits could make it easier to understand and, consequently, follow hazmat laws.
Some of the most dramatic changes in the proposed rule cover the use of technology in compliance. Many of the updates would let companies use newer technologies in hazmat shipping, like using cameras to perform inspections and calibrating equipment with fiber optics.
Impact on Shipping Businesses
Should these proposed amendments go into effect, they’ll have extensive implications for logistics businesses. The most notable is that they’d make regulatory compliance a far less time-consuming process. This could help improve on-time delivery percentages for all logistics providers.
The move to digital testing and registration systems will also help organizations in the industry. Digitization will reduce the time and expense associated with getting a hazmat operation up and running. As a result, the costs of working in this sector and average return on investment timelines could both fall.
In the DOT’s announcement about the proposed rules, they suggested that such improvements would save close to $100 million annually. Some of these savings would be on the consumer’s side as fuel and similar resources become more accessible through the streamlined authorization process. Still, companies can expect to see considerable cost improvements.
Impact on Safety
Importantly, shortening the time it takes to comply with hazmat regulations should not come at the expense of safety. While the suggested amendments are less stringent in some ways, they do not lower the bar regarding the safe transport of hazardous materials.
The DOT is not making it easier to remain compliant by reducing the standards businesses must meet. Rather, they are removing administrative barriers and enabling companies to use faster digital testing methods. Consequently, the administration hopes to boost organizational efficiency without easing actual safety-related restrictions.
This balance is important because there were 22,815 highway hazmat incidents in 2023 alone, causing 11 fatalities and 53 injuries. Any gains in speed that worsen those figures would not be worth the investment. However, enabling faster registration and inspections without loosening standards will protect both sides. Digital alternatives may even improve safety by maintaining data integrity and making it easier to find worrying trends.
Impact on Regulators
The proposed hazmat rules should also ease the burden on government regulators. While such a change does not directly impact businesses, private companies will appreciate the effects.
Roughly one in four government workers report experiencing burnout frequently. This low morale, in turn, leads to hampered productivity and a higher likelihood of errors. In a hazmat compliance context, that means additional delays and mistakes impacting businesses despite them being outside of the organization’s control.
By contrast, streamlining inspection, registration and verification processes results in a lightened workload for DOT employees and contractors. As a result, mandatory compliance workflows may not take as long and will not involve as many mistakes. The 3PLs relying on approval here can then maintain productivity with less disruption.
How Businesses Can React
In light of this news, 3PLs and other transportation companies should take the opportunity to modernize their operations. While the proposed changes are not yet law, they signify the DOT is favoring efficient, tech-centric operations. Businesses doing the same will be able to experience the benefits of the shift to their fullest. Industry experts suggest that hazmat transport teams familiarize themselves with the kinds of technologies mentioned in the draft regulation.
Incorporating artificial intelligence (AI) into condition reports and utilizing cameras to provide concrete data on a tank's structural integrity are effective strategies for enhancing supply chain efficiency. Additionally, businesses can leverage tracking technology to gain real-time visibility into shipments, enabling better optimization and risk mitigation. This enhanced visibility leads to improved supply chain efficiency and effectiveness.
Hazmat transport teams should familiarize themselves with the kinds of technologies mentioned in the draft regulation. Even if it doesn’t mandate newer methods, embracing them will help organizations become as agile as possible. Artificial intelligence (AI) can generate condition reports in seconds, and cameras can provide hard data on a tank’s structural integrity.
Not every tool is authorized under the new standards, but learning to work with cutting-edge systems prepares trucking companies for future updates. Applying things like AI and Internet of Things (IoT) tracking to non-heavily-regulated workflows will ensure businesses still benefit from them before the law evolves to allow them for hazmat compliance.
Similarly, it’s a good time to switch to a digital record-keeping system if any organizations haven’t already. Manual data entry is slow and frequently produces errors. The potential to improve speed and accuracy alone should be enough to warrant the upgrade, but now the DOT will accept electronic registrations before long. Adopting a digital solution today gives workers time to adjust to the updated workflow before they can use the same process to send information to regulators.
Finally, business leaders should stay on top of further developments from the DOT. The notice of proposed rulemaking will be available on the official Federal Register website before long and will be open for comments for 90 days once it is. After the 90-day window, companies should look for additional updates regarding the rules and enactment dates.
Regulatory Changes Pave the Way for Tech-Driven Trucking
It generally takes the government a longer time to embrace new technologies than private organizations. The latest proposed rules from the DOT suggest transport authorities are finally making such a move, bringing the tech many businesses already use into legal acceptance.
The new regulations will take time to go into effect, but when they do, 3PLs and similar services will be able to get more value from their tech. Regulators, drivers, operators and all other stakeholders will benefit.
