Risk Bond/Financial Assurance Policy for Critical Energy Infrastructure (CEI) Hub Facilities
The Critical Energy Infrastructure (CEI) Hub is a six-mile stretch of industrial development along the west shore of the Willamette River. More than 90% of all liquid fuel in Oregon is stored at facilities in the CEI Hub. This includes the gas and diesel supply for the Portland metro area, jet fuel for the Portland International Airport, and other hazardous materials that are stored there.
The CEI Hub's storage facility also happens to be constructed on unstable soil. Given the high likelihood of a major seismic event occurring in the near future, Multnomah County and the City of Portland’s Bureau of Emergency Management commissioned a seismic resiliency study to better understand the anticipated damages from the CEI Hub in the event of the Cascadia Subduction Zone (CSZ) Earthquake. The findings estimated that a CSZ earthquake would result in more than $2.6 billion in monetized costs from damages and disastrous impacts on the entire region’s health and safety.
Given Multnomah County’s responsibility in local governance, it must ensure that the public is not held financially responsible for any damages resulting from spillage at CEI Hub facilities. The Financial Assurance policy would mandate that CEI Hub facility operators demonstrate sufficient financial capacity to cover potential risks and liabilities associated with their operations.
This mandate will require an administrative entity to verify compliance of the owner or operator of the facility. This budget note requests that the Chair direct the work of the Office of Sustainability to undertake a comprehensive assessment with recommendations on the administrative requirements necessary to ensure that the owners and operators of Critical Energy Infrastructure (CEI) Hub facilities are in full compliance with the Multnomah County Financial Assurance policy.
The requested assessment and recommendations to the Board should include:
- Preferred Location for Administration
- Proof of nexus to selected department or office
- Resource Allocation
- Estimate the staffing and expertise required to effectively monitor and enforce compliance.
- Provide a detailed cost analysis of the administrative resources required for successful implementation.
The assessment and recommendations will be presented to the Board no later than September 30, 2024.