Underground Storage Tanks (USTs): Risks, Detection and Due Diligence

TL;DR Summary

Underground storage tanks (USTs) pose serious risks if they leak undetected, contaminating soil and groundwater. Phase I Environmental Site Assessments identify red flags, but confirming UST presence may require a Phase II. KOW Building Consultants helps buyers navigate UST detection and avoid costly environmental liabilities. Due diligence, like proper tank monitoring, documentation, and removal, is essential to avoid costly remediation. KOW Building Consultants helps property buyers detect and manage UST risks before they become financial liabilities.

When people talk about environmental due diligence, the conversation quickly turns to underground storage tanks (USTs), especially the responsibilities that fall on owners and operators of USTs and how they navigate evolving storage tank regulations.

These buried vessels, used to store petroleum, heating oil and other regulated liquids are indispensable for industries ranging from hospitals to gas stations. They’re also a notorious source of contamination.

A leaking UST can quietly pollute soil and groundwater for years, leaving a buyer with millions of dollars in remediation costs.

Understanding what USTs are and how they’re addressed in environmental site assessments (ESAs) helps buyers avoid unpleasant surprises.

What is an Underground Storage Tank?

The U.S. Environmental Protection Agency (EPA) defines a UST as any tank (and its connecting piping) with at least 10% of its combined volume below ground. USTs store regulated substances like gasoline, diesel, kerosene and heating oil. Because USTs sit below grade, they save valuable surface real estate and are protected from tampering; however, they are harder to access and leaks can go undetected. Modern tanks often use double‑walled designs with sensors in the space between the walls to detect leaks.

USTs vs. Above‑Ground Tanks

Unlike USTs, above‑ground storage tanks (ASTs) are visible and easier to inspect. If a spill occurs, it is more likely to be noticed and contained. USTs, by contrast, require more stringent regulations because leaks can migrate through soil into groundwater. The trade‑off is space: ASTs occupy valuable real estate while USTs free up surface area.

Why USTs Matter: Risks and Regulations

An undetected UST leak can have three major impacts:

1. Operational Disruption – Facilities that rely on USTs for emergency generators may face power or heating shortages if fuel is lost.

2. Environmental Damage – Petroleum products can contaminate soil and groundwater, posing health risks and triggering regulatory enforcement. Cleanup costs often exceed USD 1 million.

3. Regulatory Penalties – Local and federal agencies can impose fines on owners who fail to prevent or promptly address leaks.

   
   

   

   
   

Because of these risks, most jurisdictions require owners to install leak‑detection systems, secondary containment, and maintain proper records. Many older USTs installed prior to the mid‑1990s lack these safeguards, so regulators mandated replacement or retrofitting in the 1990s.

How USTs Are Handled in Phase I ESAs

Recognizing UST‑related RECs

In a Phase I Environmental Site Assessment (ESA), the environmental professional relies on visual observations and historical research to identify recognized environmental conditions (RECs). A buried tank is not excavated during Phase I; instead, the consultant looks for clues: fill pipes or vents protruding from the ground, missing removal records, anecdotal evidence from property managers or neighbors and historical aerial photos or fire insurance maps. If evidence suggests a UST is present or was never properly removed, it becomes a REC and must be noted in the report.

When Is Geophysical Scanning or Phase II Needed?

Because the standard ASTM E1527‑21 limits Phase I to non‑intrusive observations, it does not include ground‑penetrating radar (GPR) scans or excavation. If a Phase I identifies a possible UST, the consultant may recommend a Phase II ESA. Phase II involves subsurface investigation – including geophysical surveys, soil or groundwater sampling, or excavation – to confirm the presence, integrity and potential leaks from a UST. Performing GPR scans without clear justification adds unnecessary cost.

Best Practices for Managing UST Risks

Monitoring, Leak Detection and Modern Tanks

• Leak detection – Install automatic tank gauging and interstitial monitoring to detect loss of product. Newer double‑walled tanks include sensors between the walls that trigger alarms when the inner wall is breached.

• Secondary containment – Post‑2016 tanks must have secondary containment systems to prevent releases into soil.

• Material selection – Modern USTs are made of fiberglass or coated steel. Fiberglass resists corrosion but costs more and takes up more space; steel tanks are strong and compact but must be lined or coated to prevent rust.

• Proper installation and filling – Many leaks start at fill ports or product piping. Installing tanks carefully, avoiding puncturing liners and using double‑walled piping reduces spills. Overfilling or spills during refueling can also contaminate soil.

  
  

UST Decommissioning and Removal

Old or unused tanks should be properly decommissioned. That involves pump‑out and cleaning, inerting with foam or dry ice, removal or closure in place, soil testing and regulatory documentation. Improperly abandoned USTs are a frequent source of contamination and a common REC.

Final Thoughts

Underground storage tanks are integral to many properties but can pose significant environmental and financial liabilities if not properly managed. A Phase I ESA can only flag potential USTs based on visual and historical evidence; any subsurface investigation belongs in Phase II.

Buyers should never assume that the absence of obvious evidence means there is no tank. Investing in thorough due diligence performed by qualified Environmental Professionals helps you avoid inheriting hidden USTs and the hefty remediation costs that come with them.

If you’re concerned about underground tanks on a property you’re considering, contact KOW Building Consultants to discuss a comprehensive assessment.

Frequently Asked Questions About USTs and Due Diligence

Why don’t Phase I ESAs include UST scanning?

ASTM E1527‑21 limits Phase I to non‑intrusive methods; scanning or digging is part of Phase II.

Can a UST be missed during due diligence?

Yes. Old tanks may not be registered, and records can be incomplete. Thorough research, interviews and visual inspection reduce the risk but cannot guarantee discovery. Utilizing experienced consultants and conducting Phase II investigations as necessary is crucial.

Do double‑walled tanks eliminate risk?

They reduce risk but do not eliminate it. Sensors alert owners to inner wall failures, but piping, overfills and improper installation can still cause spills.

Are USTs always a bad thing?

No. USTs allow facilities to store fuel without occupying surface space. They simply require proper design, monitoring and maintenance to minimize risk.