[Federal Register Volume 79, Number 151 (Wednesday, August 6, 2014)]
[Rules and Regulations]
[Pages 46011-46040]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-18146]



[[Page 46011]]

Vol. 79

Wednesday,

No. 151

August 6, 2014

Part IV





Department of Transportation





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Pipeline and Hazardous Materials Safety Administration





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49 CFR Parts 171, 172, 173, et al.





 Hazardous Materials: Transportation of Lithium Batteries; Final Rule

Federal Register / Vol. 79 , No. 151 / Wednesday, August 6, 2014 / 
Rules and Regulations

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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Parts 171, 172, 173, 175

[Docket No. PHMSA-2009-0095 (HM-224F)]
RIN 2137-AE44


Hazardous Materials: Transportation of Lithium Batteries

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), 
DOT.

ACTION: Final rule.

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SUMMARY: PHMSA, in consultation with the Federal Aviation 
Administration (FAA), is modifying the requirements governing the 
transportation of lithium cells and batteries. This final rule revises 
hazard communication and packaging provisions for lithium batteries and 
harmonizes the Hazardous Materials Regulations (HMR) with applicable 
provisions of the United Nations (UN) Model Regulations, the 
International Civil Aviation Organization's Technical Instructions for 
the Safe Transport of Dangerous Goods by Air (ICAO Technical 
Instructions) and the International Maritime Dangerous Goods (IMDG) 
Code.

DATES: Effective Date: August 6, 2014.
    Voluntary Compliance Date: Voluntary compliance with all amendments 
is authorized August 6, 2014.
    Delayed Compliance Date: Unless otherwise specified, compliance 
with the amendments adopted in this final rule is February 6, 2015.
    The incorporation by reference of certain publications listed in 
the rule is approved by the Director of the Federal Register as of 
August 6, 2014.

FOR FURTHER INFORMATION CONTACT: Charles E. Betts or Kevin A. Leary 
Standards and Rulemaking Division, Pipeline and Hazardous Materials 
Safety Administration, telephone (202) 366-8553, or Janet McLaughlin, 
Office of Hazardous Materials Safety, Federal Aviation Administration, 
telephone 202-385-4897.

SUPPLEMENTARY INFORMATION:

Contents

I. Executive Summary
II. Background
III. Section-by-Section Review
    A. Part 171
    B. Part 172
    C. Part 173
    D. Part 175
    E. Compliance Date
IV. Regulatory Analyses and Notices
    A. Statutory/Legal Authority for this Rulemaking
    B. Executive Order 12866, Executive Order 13563, and DOT 
Regulatory Policies and Procedures
    C. Executive Order 13132
    D. Executive Order 13175
    E. Regulatory Flexibility Act, Executive Order 13272, and DOT 
Procedures and Policies
    F. Paperwork Reduction Act
    G. Regulatory Identifier Number (RIN)
    H. Unfunded Mandates Reform Act
    I. Environmental Assessment
    J. Privacy Act
    K. Executive Order 13609 and International Trade Analysis

I. Executive Summary

    In this final rule, PHMSA is revising requirements in the HMR 
applicable to the transport of lithium cells and batteries consistent 
with the UN Model Regulations, the ICAO Technical Instructions and the 
IMDG Code. The final rule:
    (1) Replaces equivalent lithium content with Watt-hours for lithium 
ion cells and batteries;
    (2) adopts separate shipping descriptions for lithium metal 
batteries and lithium ion batteries;
    (3) revises provisions for the transport of small and medium 
lithium cells and batteries including cells and batteries packed with, 
or contained in, equipment;
    (4) revises the requirements for the transport of lithium batteries 
for disposal or recycling;
    (5) harmonizes the provisions for the transport of low production 
and prototype lithium cells and batteries with the ICAO Technical 
Instructions and the IMDG Code; and
    (6) adopts new provisions for the transport of damaged, defective, 
and recalled lithium batteries.
    PHMSA is not adopting proposals to: (1) Modify provisions for what 
constitutes a change to a battery design in the UN Manual of Tests and 
Criteria; (2) require lithium cells and batteries to be marked with an 
indication that the cell or battery design passed each of the 
appropriate tests outlined in the UN Manual of Tests and Criteria; or 
(3) limit the locations on board aircraft where shipments of lithium 
cells and batteries could be stowed.
    The provisions of this final rule are consistent with Section 828 
of the ``FAA Modernization and Reform Act of 2012'' (Pub. L 112-98, 126 
Stat.133 (Feb. 14, 2012)), which prohibits DOT from issuing or 
enforcing any regulation or other requirement regarding the air 
transportation of lithium cells or batteries if the requirement is more 
stringent than the requirements of the ICAO Technical Instructions.
    PHMSA estimates that the costs of this rule would total $12.1 
million over the next 10 years when applying a 3 percent discount rate, 
and $10.8 million when applying a 7 percent rate. PHMSA also developed 
high and low cost estimates to incorporate uncertainty in quantifying 
costs--at a 7 percent discount rate the low estimate of costs is $7.4 
million and the high estimate is $15.0 million. These figures 
acknowledge that the HMR already authorize the use of the ICAO 
Technical Instructions and the IMDG Code for most lithium battery 
shipments. Further, shipments of lithium batteries transported to or 
from the U.S. must conform to either the ICAO Technical Instructions by 
air or the IMDG code by vessel. Domestic air and vessel transport of 
lithium batteries is the final remaining segment likely to be impacted 
by the amendments in this final rule. Commenters representing air 
carriers indicated that international operators and most U.S. operators 
conform to the provisions of the ICAO Technical Instructions because of 
the desire to have a single set of operational practices and training 
standards. PHMSA anticipates cost savings resulting from harmonization 
of certain requirements, including those related to proper shipping 
names and Watt-hour ratings. Separate entries for lithium metal and 
lithium ion batteries have appeared in the ICAO Technical Instructions 
and the IMDG code since 2009. PHMSA did not adopt those entries at that 
time but noted that the then new entries could be used both 
domestically and internationally, and for transportation by motor 
vehicle and rail immediately before or after being transported by 
aircraft. [74 FR 2207]. While the HMR permit the use of these shipping 
descriptions because these entries do not appear in the Hazardous 
Materials Table (HMT; Sec.  172.101) use of these descriptions 
continues to frustrate shipments. Similarly, the ICAO Technical 
Instructions and the IMDG code use the term ``Watt-hours'' to measure 
the size of lithium ion batteries, while the HMR use the term 
``equivalent lithium content.'' While both of these provide an 
indication of the size of a lithium ion battery, they are not 
interchangeable units and this difference frustrates shippers 
attempting to determine the appropriate shipping requirements. PHMSA 
anticipates some safety benefits resulting from risk reduction through 
a combination of: Reliable packaging; hazard communication; inspection 
and

[[Page 46013]]

acceptance checks prior to loading cargo aboard aircraft; pilot 
notification; and employee training, many of which have already been 
adopted into current practice.

II. Background

    PHMSA published a notice of proposed rulemaking (NPRM) in this 
docket (75 FR 1302, Jan. 11, 2010) to enhance the transport of lithium 
cells and batteries through elimination of regulatory exceptions, 
increased battery design testing requirements, air cargo stowage 
requirements, and clarification of certain other provisions. In that 
NPRM, PHMSA discussed: (1) National Transportation Safety Board (NTSB) 
Recommendations resulting from the February 7, 2006, cargo aircraft 
accident at Philadelphia International Airport suspected to have been 
caused by lithium batteries; (2) numerous minor incidents of smoke or 
fire involving lithium cells and batteries in air transportation, which 
may be ``precursors'' to a catastrophic accident; and (3) research 
conducted by FAA William J. Hughes Technical Center (Technical Center), 
which examined the characteristics of fires involving packages of 
lithium batteries, the effectiveness of conventional fire suppression 
systems at mitigating the impacts of these fires, and the ability of 
packages to contain a fire involving lithium batteries. 75 FR at 1303-
07. Specifically, in the NPRM, PHMSA proposed to:
     Adopt or revise various definitions of: ``Lithium cell or 
battery''; ``lithium content''; ``lithium ion cell or battery''; 
``lithium metal cell or battery''; ``short circuit''; and ``Watt-
hour.''
     Adopt Watt-hour, in place of ``equivalent lithium 
content'', as the measure of power (or size) of a lithium ion cell or 
battery.
     Require a shipper, carrier, package owner, or person 
reporting an incident provide reasonable assistance in an investigation 
including access to the damaged package or article.
     Replace the single proper shipping name and UN 
identification number for ``lithium batteries'' with separate proper 
shipping names and UN identification numbers for lithium metal 
batteries and lithium ion batteries and also adopt separate proper 
shipping names and UN identification numbers for lithium metal and 
lithium ion batteries packed with, or contained in, equipment.
     Consolidate requirements for shipping lithium cells and 
batteries, and exceptions into Sec.  173.185, by:
    [cir] Requiring cells and batteries to be tested in accordance with 
the latest revisions to the UN Manual of Tests and Criteria, and 
require manufacturers to retain evidence of successful completion of UN 
testing. PHMSA also indicated it was considering requiring the presence 
of a ``quality mark'' to indicate successful testing.
    [cir] Eliminating the exceptions for small cells and batteries in 
air transportation, except with respect to extremely small cells packed 
with or contained in equipment.
    [cir] Providing certain relaxed requirements for (1) the shipment 
of low production runs and prototype batteries, and (2) batteries being 
shipped for recycling or disposal.
     Require lithium cells and batteries, when transported by 
aircraft, to be stowed in a location accessible by a crew member or a 
location equipped with an FAA-approved detection and fire suppression 
system.
    PHMSA proposed an effective date for a final rule 75 days after 
publication in the Federal Register and invited comments concerning the 
additional costs that would result from such a compliance schedule, 
practical difficulties associated with quickly coming into compliance 
with the provisions of the January 11, 2010, NPRM, and any other issues 
that PHMSA should consider in making a decision on the compliance 
schedule. PHMSA also invited commenters to address the feasibility and 
practicability of a phased compliance schedule, under which certain 
provisions of the final rule would become effective on a faster 
schedule than other provisions, for which immediate compliance would be 
more difficult.
    A total of 125 persons submitted comments on the proposals in the 
January 11, 2010, NPRM. Commenters included battery and electrical 
device manufacturers, airlines, airline pilots, retailers, battery 
recyclers, members of the U.S. House of Representatives, the U.S. Small 
Business Administration (SBA), the U.S. Chamber of Commerce, and 
foreign governments. PHMSA also received comments from industry trade 
associations and other advocates representing the above named groups.
    Commenters expressed support for the overall goal of improving the 
safe transport of lithium batteries by all modes, especially air. The 
commenters also stressed the need for consistency between the HMR and 
the ICAO Technical Instructions. Several commenters suggested that even 
small deviations from the ICAO Technical Instructions in the transport 
of lithium batteries would cause significant disruptions. These 
commenters stated that differences between U.S. and international 
requirements for lithium batteries detract from safety by creating 
confusion and excessively complicating the detailed set of regulations 
that already apply to lithium battery shipments. SBA recommended that 
PHMSA consider the public comments to the proposed rule, assess the 
impact of the proposed rule on small businesses, and consider feasible 
alternatives that would meet the agency's safety objectives while 
minimizing the economic impact on small business.
    The majority of commenters focused on the proposals for: (1) 
Eliminating provisions for small lithium batteries currently found in 
Sec.  172.102, special provision 188; (2) modifying the criteria under 
which a lithium battery would be considered to be a new type; and (3) 
prescribing aircraft stowage requirements. To review the NPRM, draft 
regulatory evaluation, environmental assessment, comments, letters, and 
other materials considered in this regulatory action go to http://www.regulations.gov, docket number PHMSA-2009-0095. To locate a 
specific commenter by name simply use the search function provided by 
regulations.gov.
    Since publication of the January 11, 2010 NPRM:
     PHMSA hosted a public meeting attended by 100 individuals 
(outside of PHMSA and FAA) representing a total of 73 companies, 
organizations and other entities, 16 of whom made presentations. A 
transcript of this meeting is in the docket (at PHMSA-2009-0095-
0189).\1\
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    \1\ In addition, representatives of the Cargo Airline 
Association met with officials of the FAA on September 8, 2010, to 
present additional concerns with proposals in the NPRM, and a member 
of the Airline Pilots Association provided information to PHMSA on 
aircraft fire suppression systems, the notice to the pilot in 
command, and current training of airline personnel in a telephone 
conference on April 20, 2011. Memoranda of these contacts are in the 
docket (at PHMSA-2009-0095-0220 and -0234, respectively).
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     The FAA Technical Center continued to study the risks 
presented by lithium batteries in air transportation and ways to 
address those risks and published reports on ``Fire Protection for the 
Shipment of Lithium Batteries in Aircraft Cargo Compartments'' 
(November 2010) and, in conjunction with Transport Canada, on a 
``Freighter Airplane Cargo Fire Risk Model'' (September 2011). Copies 
of these reports are in the docket (at PHMSA-2009-0095-0235 and -0240, 
respectively).
     PHMSA evaluated transportation incidents involving lithium 
batteries and one cargo aircraft accident in which an aircraft 
transporting lithium batteries

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was destroyed and both pilots were killed.\2\
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    \2\ On September 3, 2010, in Dubai, United Arab Emirates, a 747-
400 cargo aircraft crashed while attempting to land at the Dubai 
airport after a fire was discovered. Both pilots were killed, and 
the aircraft and its cargo, which included lithium batteries, were 
destroyed. The UAE preliminary report of the accident is in the 
docket (at PHMSA-2009-0095-0238).
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     The ICAO Dangerous Goods Panel adopted revisions into the 
2013-2014 ICAO Technical Instructions that narrow exceptions for 
lithium metal and lithium ion cells and batteries not packed with, or 
contained in, equipment when transported by aircraft. PHMSA 
incorporated the 2013-2014 ICAO Technical Instructions by reference 
into the HMR in docket number PHMSA2012-0027 (HM-215L), 78 FR 988 
(January 7, 2013).\3\
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    \3\ This means that, for purposes of the HMR, a shipment of 
lithium batteries to, from, or within the United States could be 
offered and transported in accordance with the current edition of 
the ICAO Technical Instructions even before PHMSA issued a final 
rule in this proceeding.
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     In February 2012, Congress passed and the president signed 
the ``FAA Modernization and Reform Act of 2012'' that specifically 
prohibits DOT agencies from issuing or enforcing regulations regarding 
the air transport of lithium cells or batteries, whether transported 
separately or packed with, or contained in, equipment, if the 
requirement is more stringent than the requirements of the ICAO 
Technical Instructions.\4\
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    \4\ The legislation allows the continued prohibition on the 
transport of lithium metal cells and batteries aboard passenger 
aircraft. It also authorizes the issuance of more stringent 
regulation based on credible reports that lithium batteries 
substantially contributed to the initiation or propagation of a fire 
aboard an aircraft, as long as the regulations address solely the 
deficiencies referenced in the report(s) and are the least 
disruptive and least expensive variation from existing requirements 
while adequately addressing identified deficiencies.
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     In April 2012 and January 2013, PHMSA stated that it was 
considering harmonizing requirements in the HMR on the transportation 
of lithium batteries with changes adopted in the 2013-2014 ICAO 
Technical Instructions and requested additional comments on (1) the 
effect of those changes, (2) whether to require compliance with the 
ICAO Technical Instructions for all shipments by air, both domestic and 
international, and (3) the impacts if PHMSA failed to adopt specific 
provisions in the ICAO Technical Instructions into the HMR. 77 FR 21714 
(Apr. 11, 2012), 78 FR 1119 (Jan. 7, 2013).
    The changes adopted in the ICAO Technical Instructions require 
additional shipper training, markings, labels, and pilot notification 
for packages containing more than 8 lithium cells or 2 lithium 
batteries, which were previously not subject these requirements. 
Commenters to the April 11, 2012 and the January 7, 2013 notices 
unanimously supported harmonization of the HMR with the 2013-2014 ICAO 
Technical Instructions while acknowledging that the changes adopted by 
the ICAO would result in increased costs in training, package markings 
and revised procedures. Commenters also noted that, if PHMSA failed to 
harmonize the HMR with the current ICAO Technical Instructions, 
shippers and carriers would continue to struggle with the differences 
between the two sets of regulations. Commenters further stated that 
PHMSA should not adopt proposals in the NPRM that would be more 
restrictive than the ICAO Technical Instructions because this would 
place U.S. shippers and carriers at a disadvantage relative to their 
international counterparts and be in violation of the FAA Modernization 
and Reform Act of 2012. Commenters also opposed specifically 
maintaining an option to use the current HMR, instead of the ICAO 
Technical Instructions, and noted that permitting shippers and carriers 
to choose compliance with alternative standards in domestic and 
international commerce would undermine safety because the ICAO 
provisions are more stringent than the current HMR.
    Several air carriers indicated that because the 2013-2014 ICAO 
Technical Instructions would become effective January 1, 2013 they 
would be in compliance with those standards by that date regardless of 
whether (or when) PHMSA issued a final rule. Other commenters requested 
a transition period between 6 and 18 months to permit companies to 
conduct training and adjust their operations to adapt to these changes. 
Outside of a delayed compliance date, commenters did not suggest any 
other ways to reduce the compliance burden. The National Association of 
Manufacturers (NAM) indicated that supply chains will have to adapt to 
a final rule that adopts the provisions of the 2013-2014 ICAO Technical 
Instructions, but the costs of implementing these provisions would vary 
from one manufacturer to another. The Cargo Airline Association (CAA) 
suggested that the revisions in the 2013-2014 ICAO Technical 
Instructions might result in a shift in transport from the air mode to 
other modes (such as ground) but did not attempt to quantify this as 
shipping decisions would vary from company to company.
    Air carriers and international shippers stressed the desire for a 
single system to eliminate errors and streamline training. Further, the 
commenters asserted that any benefits associated with maintaining an 
option would be minor, accrued by a small number of entities and that 
these benefits would be more than offset by increased confusion 
experienced by shippers and air carriers. Additionally, commenters 
suggested that a failure by PHMSA to mandate the use of the ICAO 
Technical Instructions would create an environment where the U.S. 
permits a lesser standard than the rest of the world, placing air 
carriers and pilots at increased risk and hampering enforcement of the 
ICAO Technical Instructions.
    Based on all the comments received, and our analysis of the recent 
changes to the ICAO Technical Instructions, we are adopting into the 
HMR requirements consistent with 2013-2014 ICAO Technical Instructions, 
the 17th revised edition of the UN Model Regulations, the 5th Revised 
Edition of the UN Manual of Tests and Criteria Amendment 1, and 
Amendment 36-12 of the IMDG Code. In the section-by-section review, 
each of the proposals, with corresponding comments, and subsequent 
revisions is discussed in more detail. For convenience, a list of 
commenters is provided below:

3M Company
Airlines for America (A4A), formerly Air Transport Association (ATA)
ACCO Brands (ACCO)
Advanced Medical Technology Association (AdvaMed)
Airforwarders Association (Afa)
The Airline Pilots Association, International (ALPA)
Airtec GmbH & Co. KG (Airtec)
Alaska Airlines
The American Trucking Associations (Trucking)
Association of Hazmat Shippers, Inc. (AHS)
Association of International Automobile Manufacturers, Inc. (AIAM)
Asurion Corporation
AT&T Services Inc.
Batteries Plus LLC
Battery Association of Japan (BAJ)
Bayer HealthCare Diabetes Care
Berlin Heart Inc.
Best Buy Corporation
Biomet Incorporated
Black & Decker
Boat U.S. Foundation
Boston Power
Boston Scientific Corporation
Camera and Imaging Products Association (CIPA)
Cargo Airline Association (CAA)
Casio America (Casio)
Clean Harbors Environmental Services
Coalition of Airline Pilots Associations (CAPA)
Communications and Information Network Association of Japan (CIAJ)
CompuCom Systems, Inc.
Consumer Electronics Association (CEA)

[[Page 46015]]

Consumer Electronics Retail Coalition (CERC)
Control Technology Inc.
Corporate Radiation Safety and Dangerous Goods Transport (Siemens)
Council on Safe Transport of Hazardous Articles (COSTHA)
Covidien
CTIA--The Wireless Association
Dangerous Goods Advisory Council (DGAC)
Dangerous Goods Trainers Association (DGTA)
Delphi Automotive (Delphi)
Delta Airlines (Delta)
Deutsche Post DHL (DHL)
DGM USA
Digital Europe
Embassy of Israel
Embassy of the Republic of Korea
Energizer Battery Manufacturing, Inc. (Energizer)
EnteroMedics, Inc.
Environmental Technology Council
European Portable Battery Association (EPBA)
European Union
Express Association of America (EAA)
Fedco Electronics, Inc. (FedCo)
FedEX Express (FedEx)
Garmin International, Inc. (Garmin)
GE Corporation (GE)
GRC Wireless Recycling (GRC)
Greatbatch, Inc.
Hephner TV & Electronics
Hitachi Maxell, Ltd.
Horizon Air
International Air Transport Association (IATA)
Infinite Power Solutions, Inc.
Information Technology Industry Council (ITI)
Infotrac
International Federation of Airline Pilots Associations (IFALPA)
The Japan Electrical Manufacturer's Association (JEMA)
Japan Electronics & Information Technology Industries Association 
(JEITA)
Japan Machinery Center for Trade and Investment (JMC)
Johnson Controls
Korea International Trade Association (KITA), the Korea Electronics 
Association (KEA), and the Battery R&D Association of Korea (KORBA)
Learjet Inc.
Leroy Bennet
Lifescan, Inc. and Animas Corporation
Lithium Battery Industry Coalition
Medical Device Manufacturers Association (MDMA)
Medtronic, Inc.
Mercedes-Benz USA, LLC
MicroSun Technologies LLC
Motorola, Inc.
National Association of Manufacturers (NAM)
National Fire Protection Association (NFPA)
National Funeral Directors Association (NFDA)
The National Industrial Transportation League (NITL)
National Retail Federation (NRF)
National Transportation Safety Board (NTSB)
National Electrical Manufacturers Association (NEMA)
NetApp, Inc.
Nexergy
National Institute of Standards and Technology/US Department of 
Commerce (on behalf of Japan and on behalf of Korea)
Nokia Inc.
The North American Automotive Hazmat Action Committee (NAAHAC)
Northern Air Cargo (NAC)
Olympus Corporation of the Americas (Olympus)
Organ Recovery Systems, Inc.
Palladium Energy
Panasonic Corporation of America (Panasonic)
Photo Marketing Association
Quallion LLC (Quallion)
RadioShack Corporation
Recharge
The Rechargeable Battery Association (PRBA)
Rechargeable Battery Recycling Corporation (RBRC)
Rep. Don Young
Rep. John Mica
Rep. Robert E. Latta
Retail Industry Leaders Association (RILA)
Rockwell Automation
Rose Electronics Distributing Company
Saft
Small Business Administration Office of Advocacy (SBA)
Security Industry Association
Southwest Airlines, Co. (Southwest)
Sprint Nextel Corporation (Sprint)
SRICI Testing Center
St. Jude Medical, Inc.
SureFire LLC
Techtronic Industries (TTi)
The International Air Cargo Association (TIACA)
TNR Technical, Inc.
Transportation Intermediaries Association (TIA)
Transportation Trades Department AFL-CIO (TDD)
Troy Rank
Tyco Electronics
Tyco International
United Parcel Service (UPS)
United Technologies Corporation (UTC)
URS Corporation (URS)
US Chamber of Commerce

III. Section-by-Section Review

A. Part 171

Section 171.8 Definitions
    In the NPRM, PHMSA proposed to remove, add and amend a number of 
definitions applicable to lithium batteries, as follows:
    1. Remove the definition for ``equivalent lithium content'' and 
replace that term with ``Watt-hour'' consistent with the UN Manual of 
Tests and Criteria. Commenters supported the proposed addition of the 
term ``Watt-hour'' in place of ``equivalent lithium content'' as a 
method to measure the size of lithium ion cells and batteries.
    3. Provide separate definitions for ``lithium metal cell or 
battery'' and ``lithium ion cell or battery'' in order to differentiate 
between the different lithium battery chemistries, and a definition of 
``Short circuit'' consistent with the 5th revised edition of the UN 
Manual of Tests and Criteria, Amendment 1 and revise the definitions of 
``Aggregate lithium content'' and ``Lithium content'' also consistent 
with the 5th revised edition of the UN Manual of Tests and Criteria, 
Amendment 1. PHMSA did not receive any negative comments regarding 
these proposed changes.
    In this final rule, we are adding definitions for ``Lithium ion 
cell or battery,'' ``Lithium metal cell or battery,'' ``Short circuit'' 
and ``Watt-hour'' as proposed. We are removing the present definitions 
of ``aggregate lithium content,'' ``equivalent lithium content,'' and 
``lithium content.'' The explanation of the size or energy of a cell or 
battery is being incorporated into the definition of lithium metal cell 
or battery and lithium ion cell or battery. The term ``Aggregate 
lithium content'' is not used in the HMR.
Section 171.21 Assistance in Investigations
    In Sec.  171.21, PHMSA requires a shipper, carrier, package owner, 
package manufacturer or certifier, repair facility, or person reporting 
a hazardous materials transportation incident to provide assistance to 
authorized representatives of the Department of Transportation 
investigating the incident. In the NPRM, PHMSA proposed to specifically 
require such persons to provide reasonable access to a damaged package 
or article involved in a transportation incident. PHMSA proposed these 
revisions in response to NTSB Recommendation A-07-107 that recommends 
retaining failed lithium batteries or devices for further analysis. 
After an incident, often the only evidence provided to PHMSA and the 
FAA is a written incident report, and in some instances, pictures of 
the involved package or article. In some cases, analysis of the damaged 
article may reveal the cause of the incident.
    NEMA supported this proposal and suggested that, if this 
requirement had been in place earlier, PHMSA and the FAA would possess 
more information regarding the causes of many of the lithium battery 
incidents cited in the NPRM. UPS and URS request clarification on the 
phrases ``reasonable access'' and ``if available,'' noting that the 
term ``reasonable'' is not defined. NAC raised environmental and safety 
concerns associated with the storage of hazardous materials in the 
workplace. NTSB stated that PHMSA could significantly improve the NPRM 
if

[[Page 46016]]

retention and analysis of failed batteries and equipment were required.
    After reading the comments and reexamining the proposal, we 
concluded that the regulations as currently written already meet the 
intent of recommendation A-07-107. Specifically Sec. Sec.  109.3 and 
109.9 permit a designated agent of the U.S. DOT to gather information 
in support of an investigation and direct a package to be transported 
to a facility for examination to evaluate whether the package conforms 
to the appropriate requirements. Based on the particular circumstances 
involved in an incident investigation PHMSA may decide to examine 
failed batteries or devices. In the case of lithium batteries, the 
decision about whether PHMSA will retain and examine the remains of a 
lithium battery incident depend on the condition of the package or 
article involved in the incident (e.g., where did the incident occur, 
did the incident involve other packages, are there sufficient remains 
to examine, can the cause be determined based on other evidence?) PHMSA 
uses this information to conduct follow-up investigations as necessary.
Sections 171.12, 171.22, 171.23, 171.24, 171.25 Use of International 
Standards and Regulations
    The HMR, ICAO Technical Instructions, IMDG Code, and the Transport 
Canada TDG Regulations are based on the UN Recommendations, which are 
model regulations issued by the UN Committee of Experts on the 
Transport of Dangerous Goods. The HMR, with certain conditions and 
limitations, permit both domestic and international shipments of 
hazardous materials to be offered for transportation and transported 
under provisions of, the ICAO Technical Instructions, the IMDG Code and 
the TDG Regulations as appropriate. In most cases where we allow 
compliance with an alternative standard such as the ICAO Technical 
Instructions or the IMDG Code, the level of safety is at least equal to 
the HMR. However, in a limited number of situations additional 
conditions or limitations are necessary consistent with the public 
interest or are required to comply with other federal law. Examples of 
these condition or limitations include but are not limited to: Approval 
of Class 1 (explosive) materials; identification of hazardous 
substances and hazardous wastes; and the prohibition on the transport 
of lithium metal batteries by passenger aircraft.
    In the NPRM, PHMSA proposed more stringent requirements than the 
ICAO Technical Instructions and the IMDG Code that were effective at 
the time the NPRM was published. Most commenters strongly recommended 
that we adopt the standards set forth in the ICAO Technical 
Instructions and the IMDG code, rather than the more stringent 
requirements proposed in the NPRM. These commenters contended that the 
proposed amendments would create confusion, decrease compliance, and 
negatively impact safety throughout the supply chain. Since the NPRM 
was published, the ICAO Technical Instructions have been revised 
several times and provide additional protections not found in the 
current HMR including a reduction in the number of batteries permitted 
in a package, employee training and explicit hazard communication. 
Accordingly, we would be continuing to allow a lower level of safety 
for the domestic transportation of lithium cells and batteries if we do 
not harmonize the HMR with the 2013-2014 ICAO Technical Instructions.
    DGAC noted the provisions in the proposed Sec.  171.12(a)(6)(i) 
would effectively impose less stringent requirements for shipments 
originating in Canada than PHMSA proposed for domestic shipments by 
rail or highway. PHMSA intends all lithium batteries offered for 
transport to, from, or through the United States in accordance with the 
Canadian TDG regulations to also comply with the appropriate 
requirements of the HMR.
    Based on those comments received, and our analysis of the 
requirements of the 2013-2014 ICAO Technical Instructions, we are 
adopting into the HMR requirements consistent with 2013-2014 ICAO 
Technical Instructions, the 17th revised edition of the UN Model 
Regulations, the 5th Revised Edition of the UN Manual of Tests and 
Criteria Amendment 1, and Amendment 36-12 of the IMDG Code. In this 
final rule, we are amending Sec. Sec.  171.12, 171.24 and 171.25 to 
reflect the revised proper shipping names for lithium metal batteries, 
already found in the ICAO Technical Instructions and the IMDG Code and 
we will maintain the current prohibition on the transport of lithium 
metal batteries aboard passenger aircraft.

B. Part 172

Section 172.101 Hazardous Materials Table
    At present, the Hazardous Materials Table (HMT) in Sec.  172.101 
contains three entries for lithium batteries. (1) Lithium battery 
(UN3090), (2) Lithium batteries, contained in equipment (UN3091), and 
(3) Lithium batteries packed with equipment (UN3091). In the NPRM we 
proposed to adopt separate entries for lithium metal and lithium ion 
batteries (including lithium metal and lithium ion batteries packed 
with, or contained in, equipment) to be consistent with the UN Model 
Regulations, the ICAO Technical Instructions and the IMDG Code. 
Commenters to the NPRM supported the clarification brought by the 
separate shipping descriptions. In this final rule, PHMSA is adopting 
the new HMT entries shown in the chart below:

Lithium ion batteries including lithium ion polymer   UN3480, 9, II
 batteries.
Lithium ion batteries contained in equipment          UN3481, 9, II
 including lithium ion polymer batteries.
Lithium ion batteries packed with equipment           UN3481, 9, II
 including lithium ion polymer batteries.
Lithium metal batteries including lithium alloy       UN3090, 9, II
 batteries.
Lithium metal batteries contained in equipment        UN3091, 9, II
 including lithium alloy batteries.
Lithium metal batteries packed with equipment         UN3091, 9, II
 including lithium alloy batteries.
 

    DGAC and IATA asked PHMSA to clarify the quantity limits for 
lithium batteries packed with, or contained in, equipment. DGAC 
recommended that PHMSA clarify that the mass limit applies to the mass 
of batteries in or with equipment, excluding the weight of the 
accompanying equipment and packaging. IATA requested that PHMSA align 
the quantity limits shown in column 9 of the hazardous materials table 
with respect to batteries contained in equipment with the ICAO 
Technical Instructions. The aircraft quantity limits for lithium 
batteries including lithium batteries packed with, or contained in, 
equipment in this final rule are aligned with package limits described 
in the 2013-2014 ICAO Technical Instructions.
Section 172.102 Special Provisions
    Section 172.102 contains special provisions applicable to the 
transportation of specific hazardous materials. In this final rule, 
PHMSA is

[[Page 46017]]

removing and revising several special provisions as follows:
Special Provision 29
    Special provision 29 outlines provisions for the transport of low 
production runs of lithium batteries. As proposed in the NPRM, PHMSA is 
deleting special provision 29 and combining the transport provisions 
for low production runs with the transport provisions for prototype 
lithium batteries into Sec.  173.185(e). See the detailed discussion of 
the revisions to Sec.  173.185 below.
Special Provision 134
    Special provision 134 applies to vehicles powered by wet batteries, 
sodium batteries, or lithium batteries and equipment powered by wet 
batteries or sodium batteries that are transported with these batteries 
installed. In this final rule, PHMSA is revising special provision 134 
to reflect the adoption of separate shipping descriptions for lithium 
ion batteries and lithium metal batteries.
Special Provisions 188, 189
    Special provisions 188 and 189 contain transport provisions for 
``small'' and ``medium'' lithium cells and batteries. These provisions 
are being revised and moved to Sec.  173.185(c). Consequently, in this 
final rule, PHMSA is deleting special provisions 188 and 189. See the 
detailed discussion of the revisions to Sec.  173.185 below.
Special Provision 190
    Special provision 190 contains transitional provisions enacted in a 
previous rulemaking pertaining to lithium batteries published August 9, 
2007 (72 FR 44930). The transition period shown in special provision 
190 has expired and is it no longer effective. In this final rule, 
PHMSA is deleting special provision 190.
Special Provision 328
    Special provision 328 applies to fuel cell systems that also 
contain lithium batteries. In this final rule, PHMSA is revising this 
special provision to reflect the adoption of separate shipping 
descriptions for lithium ion batteries and lithium metal batteries.
Special Provision A51
    Special provision A51 applies to the air transport of aircraft 
batteries, including lithium ion batteries. In this final rule, PHMSA 
is revising this special provision to reflect the adoption of separate 
shipping descriptions for lithium ion batteries and lithium metal 
batteries.
Special Provision A54
    Special provision A54 requires a competent authority approval if 
the mass of a lithium battery exceeds the quantity limit specified in 
Column 9B for the HMT. In this final rule, PHMSA is revising this 
provision slightly to maintain consistency with the ICAO Technical 
Instructions.
Special Provision A55
    Special provision A55 outlines conditions for the air transport of 
prototype lithium batteries. PHMSA is deleting special provision A55 
and combining the transport provisions for low production runs with the 
transport provisions for prototype lithium batteries into Sec.  
173.185(e). See the detailed discussion of the revisions to Sec.  
173.185, below.
Special Provision A100
    Special provision A100 prohibits the transport of lithium metal 
batteries aboard passenger carrying aircraft and permits the transport 
of up to 5kg of lithium ion batteries aboard passenger aircraft. In 
this final rule, PHMSA is adopting separate HMT entries for lithium 
metal batteries and lithium ion batteries. With the adoption of 
separate HMT entries for lithium metal and lithium ion batteries, this 
special provision is no longer necessary and is deleted.
Special Provision A101
    Special provision A101 outlines the conditions and limitations on 
the air transport of lithium metal and lithium ion batteries packed 
with or contained in equipment. In this final rule, PHMSA is revising 
this special provision consistent with comparable provisions in the 
ICAO Technical Instructions applicable to lithium metal batteries 
packed with or contained in equipment.
Special Provision A103 And A104
    Special provisions A103 and A104 prescribe quantity limits for 
lithium ion batteries packed with or contained in equipment. In this 
final rule, PHMSA is adopting separate HMT entries for lithium metal 
batteries and lithium ion batteries. With the adoption of separate HMT 
entries for lithium metal and lithium ion batteries, these special 
provisions are no longer necessary and are deleted.

C. Part 173

Section 173.185 Lithium Cells and Batteries
    In Sec.  173.185, PHMSA sets forth packaging requirements and 
certain conditional exceptions for the transport of lithium batteries. 
As discussed above, other conditions and exceptions are located in 
special provisions in Sec.  172.102. In the NPRM, PHMSA proposed to 
consolidate into a single section provisions for the packaging of 
lithium batteries primarily by relocating relevant requirements 
currently located in special provisions to Sec.  173.185. Unless 
otherwise specified in this section, the hazard communication and 
training requirements located in part 172 of this subchapter will 
continue to apply to the transport of lithium cells and batteries.
    Most commenters, including AHS, BAJ, COSTHA, UPS, and NAC supported 
the consolidation of lithium battery requirements into one section. 
Other commenters, including Delphi and NEMA supported the efforts to 
consolidate the lithium battery provisions into a single, easily 
referenced section, but suggested that this can only work if PHMSA 
harmonizes the HMR with international regulatory approaches.
    In this final rule, PHMSA is consolidating into Sec.  173.185 the 
general requirements for lithium batteries including UN design testing 
requirements, packaging requirements, and other transport conditions. 
Based on the provisions outlined in the ICAO Technical Instructions, 
the UN Model Regulation, and the IMDG Code, we are reorganizing this 
section by:
     Keeping the design testing and general safety requirements 
in paragraph (a) and adding a requirement to create and retain records 
of successful testing.
     Consolidating in paragraph (b) the packaging requirements 
for lithium cells and batteries, including cells or batteries packaged 
with, or contained in, equipment, when these items are shipped as Class 
9 materials, including the provision in current paragraph (h) for 
shipping larger batteries (exceeding 12 kg (26.5 lbs in weight)).
     Placing exceptions for smaller lithium cells and batteries 
in paragraph (c).
     Revising paragraph (d), covering cells and batteries 
shipped for disposal or recycling, and consolidating in paragraph (e) 
provisions covering shipments of both low production runs and prototype 
cells or batteries.
     Adding provisions for shipping damaged, defective, or 
recalled batteries in paragraph (f).
     Moving to paragraph (g) the provision in current paragraph 
(f) for approval of transportation of a lithium cell or battery that 
does not comply with requirements in the HMR.

[[Page 46018]]

(a) Classification
    In Sec.  173.185(a), the HMR describe the requirements for 
transporting cells and batteries as a Class 9 material. These 
requirements include UN battery design testing, general battery design 
safety requirements, and packaging requirements. In the NPRM, we 
proposed to incorporate by reference the 5th revised edition of the UN 
Manual of Tests and Criteria and add (1) specific criteria for when 
testing of a ``different design'' would be required, and (2) a 
requirement for a manufacturer to maintain evidence of successful 
completion of required tests. We also sought comments on the benefits 
of requiring a quality mark, which would signify compliance with the UN 
battery design tests, to appear on the outside of the battery case.
     Test requirements and exemption for existing designs.
    PHMSA adopted the fifth revised edition of the UN Manual of Tests 
and Criteria in the January 19, 2011 final rule (HM-215K) and Amendment 
1 thereto in the January 7, 2013 final rule (HM-215L). Commenters 
including Saft and UPS supported adopting the updated testing standards 
in the 5th revised edition, but expressed concern that absent any 
exemption provision addressing cells and batteries qualified under 
prior versions of the UN tests, it would appear that all cell and 
battery designs would need to be retested.
    PHMSA agrees with Saft's recommendation to allow the continued 
transport of lithium cells and batteries tested under the prior 
versions of the UN tests. In this final rule, we are adding a reference 
to the 5th revised edition Amendment 1 of the UN Manual of Tests and 
Criteria and permit the continued transportation, without retesting, of 
lithium cell and battery designs that were tested in accordance with 
the version of the UN Manual of Tests and Criteria effective when the 
cell/battery was first transported.
    In the 5th revised edition of the UN Manual of Tests and Criteria, 
Amendment 1, the criteria for batteries different from a tested type 
were revised to provide a non-exhaustive list of changes to a lithium 
battery or cell design that could be expected to ``materially affect 
the test results'' and require further testing. In the NPRM, PHMSA had 
proposed a separate list of changes that might lead to a failure of any 
of the tests would have constituted a design change requiring a 
manufacturer to subject a lithium battery design to the appropriate 
tests. The proposed changes would have been more conservative than 
those provisions adopted in the 5th Revised edition of the UN Manual of 
Tests and Criteria and would have included: any change to (1) the 
anode, cathode, or electrolyte material; (2) protective devices 
including hardware or software; (3) the safety design of the cells, 
such as the safety vent; (4) the number of component cells; or (5) the 
connecting mode of the component cells.
    PHMSA received mixed responses from commenters on this proposal. 
Some commenters supported the proposed changes, suggesting the examples 
provide useful clarification. Several comments from lithium battery and 
equipment manufacturers and other groups representing the battery 
industry and small business interests questioned the basis for proposed 
modifications to the design change criteria and the benefit of the 
specific criteria. They stated that changes that could influence safety 
vary and are not limited to the provided examples; conversely, certain 
changes on the proposed list may not always materially affect the test 
results. These commenters asked PHMSA to retain the design change 
requirements outlined in the UN Manual of Tests and Criteria.
    In this final rule, we are not adopting the text proposed in the 
NPRM. The provisions outlined in the 5th Revised Amendment 1 of UN 
Manual of Tests and Criteria provide sufficient guidance to make 
testing determinations; PHMSA will continue to study this matter and 
stresses the importance of testing after any material modifications in 
the design or manufacturing.
     Test record requirements.
    The UN Model Regulations and the ICAO Technical Instructions 
require lithium cells and batteries (including lithium cells and 
batteries packed with, or contained in, equipment) offered for 
transport to be manufactured under a quality management program (QMP) 
that includes: (1) A description of the organizational structure and 
responsibilities of personnel with regard to design and product 
quality; (2) the relevant inspection and test, quality control, quality 
assurance, and process operation instructions that will be used; (3) 
process controls that should include relevant activities to prevent and 
detect internal short circuit failure during manufacture of cells; (4) 
quality records, such as inspection reports, test data, calibration 
data, and certificates. Test data must be kept and made available to 
the appropriate national authority upon request; (5) management reviews 
to ensure the effective operation of the quality management program; 
(6) a process for control of documents and their revision; (7) a means 
for control of cells or batteries that are not conforming to the type 
tested; (8) training programs and qualification procedures for relevant 
personnel; and (9) procedures to ensure there is no damage to the final 
product.
    We are not adopting the requirement for lithium batteries to be 
manufactured in accordance with a quality management program in this 
final rule. We have not fully assessed the impact of requiring each 
cell and battery manufacturer to create and maintain such a program. 
However, since quality control in manufacturing is an important 
prerequisite to ensuring the safe transport of lithium batteries, we 
intend to initiate a separate rulemaking project to consider adopting 
additional portions of the QMP. Meanwhile, we encourage manufacturers 
to use good practices for ensuring consistency in manufacturing such as 
those found in the UN Model Regulations and the ICAO Technical 
Instructions.
    At this time, we are adopting, as proposed and consistent with good 
quality management practices, a requirement for manufacturers to retain 
evidence of a successful completion of the UN design tests, for as long 
as they offer that battery design for transportation, and for one year 
thereafter. Manufacturers would be required to maintain this evidence 
in a readily accessible location at the principal place of business, 
for as long as the lithium batteries are offered for transportation in 
commerce, and for one year thereafter. Each person required to maintain 
this evidence must make it available at reasonable times and locations. 
This requirement would apply to all new cells and batteries 
manufactured after the effective date of this final rule. Commenters 
were generally supportive of this change.
    UPS stated that a person could construe the proposed record-
retention requirement as conditioning the length of the record-
retention period upon the manufacturer's offering of the lithium cell 
or battery for transportation, or such a transportation offering by any 
other person. Accordingly, we are adopting the suggestion of UPS to 
provide in Sec.  173.185(a)(2) that ``Each person who manufactures 
lithium cells or batteries must create a record of satisfactory 
completion of the testing prior to offering the lithium cell or battery 
for transport and must: (1) maintain this record for as long as that 
design is offered for transportation and for one year thereafter, and 
(2) make this record available to an authorized representative of the 
Federal, state or local government upon request.

[[Page 46019]]

    NEMA and PRBA questioned PHMSA's assumptions and analysis on 
information collection costs for the creation of battery design testing 
records. NEMA stated that a design drawing for a simple battery pack 
adequate for use in any reasonable quality system takes 8-16 hours of a 
skilled draftsman, along with a few hours of engineering support, and 
both types of employees earn more than $25 per hour. The commenter 
further stated that even the smallest assembler has more than 10 
designs and major companies have hundreds of designs. However, this 
final rule does not require a lithium battery manufacturer to generate 
engineering drawings or extensive documentation. While the commenter 
notes that a battery assembler may have various designs, the commenter 
did not elaborate on whether each of these designs would require 
separate testing and documentation in accordance with the requirements 
for the UN Manual of Tests and Criteria.
    This final rule requires manufacturers to retain evidence of 
successful completion of the required tests, for as long as they 
manufacture that battery design and for one year thereafter. This 
evidence must also be made available to an authorized representative of 
the federal, State or local government, upon request. PHMSA is 
adjusting its information collection burdens for the creation and 
retention of records of completion of design testing requirements. 
PHMSA estimates the burden of generating and retaining documentation 
that certifies compliance with the UN Manual of Tests and Criteria 
based upon an assumption that there are 110 active lithium battery 
manufacturers, which produce an average of 10 designs each, and that 
each design requires approximately 30 minutes of design records to be 
generated and documented. This produces an industry total of 550 hours.
     General safety requirements.
    The HMR require lithium batteries to be equipped with certain 
safety features such as safety venting devices and diodes or fuses if a 
battery contains cells or series of cells that are connected in 
parallel. These provisions (currently in Sec.  173.185(a)(2) and 
(a)(3)) are being combined into a single sub-paragraph (a)(3).
     Marking of Watt-hour rating on lithium ion batteries.
    We are adding a requirement in paragraph (c)(1)(i) that each small 
lithium ion battery manufactured after December 31, 2015, to be marked 
with the Watt-hour rating on the outside case. This action is 
consistent with requirements found in the UN Model Regulations, the 
ICAO Technical Instructions and the IMDG Code since 2009. Incorporating 
this provision into the HMR ensures greater consistency between the HMR 
and the international regulatory standards. As previously mentioned, 
this requirement has been in effect in the UN Model Regulations, the 
ICAO Technical Instructions and the IMDG code for several years, we do 
not anticipate substantial impact in complying with this requirement.
     Marking cells and batteries to indicate successful 
testing.
    In the NPRM, PHMSA stated that it was considering requiring the 
presence of a visible quality mark on the outside case of each cell or 
battery to signify successful completion of the required lithium 
battery design tests in a readily recognizable manner. The proposal was 
intended to promote knowledge of the UN tests throughout the world and 
provide downstream shippers with a straightforward means of identifying 
lithium batteries that meet applicable UN testing standards.
    PHMSA received supportive comments from ALPA, TDD, and air carriers 
stating this would provide useful information for shippers to determine 
if cells and batteries were properly tested prior to offering them into 
transport. Most commenters questioned the benefit of an additional mark 
on batteries already marked in compliance with other bodies such as 
Underwriters Laboratory. Several other commenters stated that the 
presence of an additional symbol in no way affects the likelihood that 
a particular battery complies with the UN testing provisions, and posed 
problems since the mark could be counterfeited. Several air carriers 
commented that carriers should not be expected to look inside packages 
or devices to see if a mark is present. Until a universally recognized 
quality mark is established, and the obstacles to implementing such a 
system are overcome, PHMSA will not propose to require such a mark.
     Liquid cathode cells.
    PHMSA also proposed to retain the longstanding prohibition in 
current Sec.  173.185(a)(6) forbidding the transport of certain liquid 
cathode cells when discharged to less than 2 volts or 2/3 the voltage 
of the fully charged cell, except when transported for disposal or 
recycling. Saft states that this prohibition does not exist in the UN 
Model Regulations or the IMDG Code. It states the ICAO Dangerous Goods 
Panel (DGP) removed this provision from the ICAO Technical Instructions 
effective January 1, 2011 based on improvements to lithium battery 
manufacturing and the addition of a forced discharge test to the UN 
design testing requirements that eliminate the need for this now 
outdated provision. We agree that there is no longer any need for this 
provision, and it is being removed.
(b) Packaging of Class 9 Materials
    The HMR currently require lithium cells and batteries to be packed 
in inner packagings in such a manner as to prevent short circuits, 
including movement which could lead to short circuits. These inner 
packaging must be placed in an outer package conforming to the 
requirements of part 178, subparts L and M, at the Packing Group II 
performance level. The HMR also require that lithium cells or batteries 
packed with equipment and lithium cells or batteries contained in 
equipment must be: (1) Of a design that meets the UN tests; (2) packed 
to prevent short circuits; and (3) packed in UN-performance packagings 
and the equipment and the packaged cells or batteries contained in a 
strong outer package.
    In the NPRM, PHMSA proposed to continue these requirements but 
consolidate in paragraph (b) all the packaging requirements for lithium 
cells and batteries shipped as a Class 9 material, including cells and 
batteries packed with, or contained in, equipment. Three commenters, 
DGAC, IATA, and COSTHA, appear to have interpreted the proposals in the 
NPRM to except lithium batteries packed with equipment from the 
specification packaging requirements not covered by an exception. This 
was not our intent. Lithium batteries packed with equipment that 
otherwise do not meet the criteria for an exception must be placed into 
a suitable UN standard packaging that meets the Packing Group II 
performance level consistent with the UN Model Regulations, the IMDG 
Code, and ICAO Technical Instructions.
    The HMR also currently require lithium battery powered equipment to 
be placed into a strong outer packaging that is waterproof or is made 
waterproof by nature of its construction. NAM and Delphi suggested 
removing this requirement. They state that waterproof packaging 
requirements for equipment containing lithium ion or lithium metal 
batteries regardless of mode of transportation (air, rail, highway, and 
water) are onerous and inconsistent with the UN Model Regulations, the 
ICAO Technical Instructions, and the IMDG Code. Covidien requests 
clarification of the word ``waterproof'' and requests that PHMSA 
acknowledge in its review that the concept of ``waterproof'' should be 
a risk-based

[[Page 46020]]

determination tied to international approaches, rather than an absolute 
concept. Since this requirement does not appear in the UN Model 
Regulations, the ICAO Technical Instructions or the IMDG Code, and 
there is no clear basis for this requirement in the HMR, PHMSA is 
removing this requirement.
    Saft states the requirement that lithium batteries be packed in 
combination packages that meet the packing group II performance 
standards appears inconsistent with the provision in current Sec.  
173.185(g) allowing batteries that exceed 12 kg gross weight and are 
equipped with a strong, impact-resistant, outer casing currently to be 
packaged in a strong outer packaging in a protective enclosure. For 
clarity, PHMSA is moving this separate packaging provision to paragraph 
(b)(5) under the Class 9 packaging requirements.
    In this final rule, PHMSA is harmonizing the packaging requirements 
applicable to lithium batteries packed with equipment and lithium 
batteries contained in equipment with the UN Model Regulations, the 
ICAO Technical Instructions and the IMDG Code. When packed with 
equipment, the lithium battery must be placed into an authorized 
package that meets the Packing Group II performance level, or the 
battery must be placed into a suitable inner packaging then placed with 
the equipment into a suitable outer package that meets the Packing 
Group II performance level. The packaging requirements for lithium 
cells and batteries, including lithium cells and batteries packed with, 
or contained in, equipment, are contained in a single paragraph (b). 
Paragraph (b)(1) includes a reference to the general packaging 
requirements in Sec. Sec.  173.24 and 173.24a applicable to all 
hazardous materials, and a definition of the term ``equipment,'' as it 
is used in this section. Paragraph (b)(2) includes provisions specific 
to lithium batteries such as packaging to prevent short circuits, 
sparks, or the generation of a dangerous amount of heat movement within 
the package. Paragraph (b)(3) sets forth packaging requirements for 
lithium cells and batteries not contained in equipment (i.e., packages 
of batteries, and batteries packed with equipment). These are specific 
requirements applicable to only these configurations including a 
requirement that inner packaging completely enclose the cell or battery 
and the authorized UN outer packagings. Paragraph (b)(4) includes the 
unique additional requirements applicable to lithium batteries 
contained in equipment, including a requirement that equipment be 
protected from accidental activation and providing an exception from UN 
packaging. Paragraph (b)(5) includes a provision for packaging lithium 
batteries and assemblies of batteries with a gross weight greater than 
12 kg (26.5 lbs) that employ a strong impact resistant outer casing 
which was formerly located in Sec.  173.185(g).
(c) Exceptions
    As discussed above, special provisions 188 and 189 currently 
provide provisions for ``small'' and (for rail or highway only) 
``medium'' lithium metal and lithium ion cells and batteries, 
respectively, provided they meet the design tests outlined in the UN 
Manual of Tests and Criteria, and are packed in a strong outer package 
in a manner that prevents short circuits and damage.\5\ Each package 
containing more than 24 lithium cells or 12 lithium batteries must: (1) 
Be marked to indicate that it contains lithium batteries and that 
special procedures are to be followed if the package is known to be 
damaged; (2) be accompanied by a document indicating that the package 
contains lithium batteries and that special procedures are to be 
followed if the package is known to be damaged; (3) weigh no more than 
30 kilograms; and (4) be capable of withstanding a 1.2 meter drop test, 
in any orientation, without shifting of the contents that would allow 
short-circuiting or release of package contents.
---------------------------------------------------------------------------

    \5\ A ``small'' lithium cell or battery may not contain more 
than 1 gram per lithium metal per cell, 2 grams lithium metal 
battery or 1.5 grams ELC per lithium ion cell, 8 grams ELC per 
lithium ion battery. A ``medium'' lithium cell or battery may only 
metal lithium 1 gram and 5 grams per cell and between 5 grams and 25 
grams per battery or, for a lithium ion cell or battery, ELC between 
1.5 grams and 5 grams per lithium ion cell and ELC between 8 grams 
and 25 grams.
---------------------------------------------------------------------------

    In the NPRM, PHMSA proposed to:
     Create a new exception for extremely small batteries with 
very low energy (i.e. 0.3 grams lithium content for lithium metal or 
3.7 Wh for lithium ion) when packed with or contained in equipment. We 
additionally requested comment on an exception for lithium batteries 
shipped at a reduced state of charge. PHMSA based the 0.3 gram or 3.7 
Wh thresholds on the energy levels found in common coin or button 
cells.
     Eliminate the current exceptions for the air transport of 
small lithium cells and batteries, including small cells and batteries 
packed with or contained in equipment. Thus when transported by air, 
all lithium cells and batteries would be regulated in the same manner 
regardless of their size;
     Restrict exceptions for surface transport consistent with 
the UN Model Regulations and the IMDG Code.
    [cir] Highway, rail and vessel shipments of ``small'' cells/
batteries would be excepted from shipping paper, marking and labeling 
requirements;
    [cir] Shipments of ``medium'' cells/batteries would be restricted 
to highway and rail only;
    [cir] Packages containing more than 8 lithium cells or 2 lithium 
batteries would be subject to package marks indicating presence of 
lithium batteries and special procedures to follow if package damaged, 
an accompanying shipping document, a 1.2 meter drop test and 30 kg per 
package weight limit;
    Recent revisions to the ICAO Technical Instructions include 
provisions for extremely small lithium metal cells and batteries 
containing less than 0.3 grams of lithium metal, lithium ion cells and 
batteries less than 2.7 Wh, and an exception from button cells 
installed in equipment, such as circuit boards. We also expect that 
implantable medical devices would be covered under this exception. 
PHMSA is revising the HMR consistent with these exceptions.
    Other changes that became effective in the 2013-2014 ICAO Technical 
Instructions concerned small lithium cells and batteries that by virtue 
of their size, were previously afforded exceptions from most 
requirements. The revisions now effective in the ICAO Technical 
Instructions require: (1) Each package that contains more than 8 small 
lithium cells or two small lithium batteries display a Class 9 hazard 
warning label in addition to the lithium battery handling label; (2) 
shipping papers accompany the shipment, unless the shipper provides 
alternative written documentation describing the shipment; (3) 
formalized employee training and testing; (4) carrier acceptance 
checks; and (5) pilot notification.
    ACCO, PRBA, and BAJ stated that the very low threshold for 
excepting batteries (0.3 g or 3.7 Wh) would provide little to no 
assistance to shippers utilizing single cell batteries such as cellular 
phones and other consumer electronic devices that generally fall in the 
range of 4-6 Wh. Alaska Airlines, A4A, NAC and NEMA questioned the 
basis for the proposed battery size limits and raised concern regarding 
the effects of proposing additional requirements not contained in the 
ICAO Technical Instructions. Other commenters stated that the exception 
is unnecessarily restrictive. Garmin considers devices containing 
lithium batteries such as cellular phones and MP3 players as posing no 
danger of

[[Page 46021]]

accidental external short circuiting. The commenter stated that the 
physical structure of these devices, the custom packaging for spare 
batteries, and the recessed nature of battery terminals all effectively 
mitigate short circuit hazards in transport. Digital Europe requests 
PHMSA align with the ICAO Technical Instructions that except lithium 
button cells installed in equipment from certain marking requirements.
    IFALPA, ALPA, NFPA, and NTSB supported PHMSA's original proposal to 
otherwise eliminate regulatory exceptions for lithium batteries in air 
transportation, including the introduction of requirements for hazard 
labeling, packaging, training, and the inclusion of lithium battery 
shipments on the notice to the pilot in command. These commenters 
support subjecting all lithium batteries to the same requirements, 
regardless of size. They stated that this will improve hazard 
communication, reduce battery incidents through enhanced training, and 
provide pilots with knowledge of the size, location, and the quantity 
of lithium battery shipments that will assist flight crew decision 
making during an in-flight emergency. NFPA stated that the proposed 
measures included in the NPRM provide more complete information, in a 
more consistent manner, for access by the transporter as well as the 
emergency responders, when necessary. In their comments to the NPRM, 
the NTSB stated that cargo shipments of small lithium batteries should 
be subject to the same packaging and identification requirements that 
apply to medium and large lithium batteries to alert package handlers 
to exercise greater care when loading and unloading packages containing 
them. ALPA stated that hazardous materials have been safely transported 
for decades under the HMR, and bringing lithium batteries fully into 
this regulatory scheme would provide significant safety benefits. ALPA 
goes on to say that by eliminating the regulatory exception for lithium 
battery shipments, handlers will separate packages containing lithium 
batteries from general freight, reducing the possibility of inadvertent 
damage. These shipments would also be subject to an acceptance check by 
airline personnel prior to placement in air transportation, including 
inspection of the package to detect damaged or improperly prepared 
packages.
    Most other commenters opposed PHMSA's proposal to eliminate the 
regulatory exceptions for the air transport of lithium batteries. AIAM, 
COSTHA, DGM, EPBA, and IATA cited confusion and increased complexity 
that would result from different requirements. ATA, Alaska Airlines, 
CEA, Horizon Air, Korea, Panasonic, PRBA, and Saft did not accept 
PHMSA's incident analysis as support for eliminating the regulatory 
exceptions for lithium batteries. These commenters stated they are not 
aware of any safety incidents involving the air transport of properly 
packaged batteries, or batteries in compliance with existing 
regulations. CIPA and Fedco added that new regulations will not enhance 
compliance if shippers ignore them. TIACA stated that the incidents 
cited for reasons of non-compliance raises calls for better 
enforcement, rather than sweeping new regulations. The SBA recommended 
that PHMSA conduct further outreach to the regulated community to 
enhance dialogue, promote safety, and ensure harmonization.
    Saft, Southwest, and others stated that PHMSA's decision to propose 
different requirements for lithium batteries and lithium batteries 
packed with, or contained in, equipment than those applied 
internationally would actually detract from safety, because these 
differences would create confusion and excessively complicate an 
already complex set of regulations that apply to lithium battery 
shipments. SBA and PRBA stated that the proposed rules would create 
conflicting standards and require significant supply chain redesigns. 
Lifescan, NAM, UPS, and others cite multimodal difficulties when the 
U.S. HMR conflict with the other published regulations. They stated 
that the provisions in the NPRM will cause such packages and devices to 
be non-compliant upon entering the United States.
    Other commenters stated that the imposition of more restrictive 
U.S. requirements compared to the ICAO Technical Instructions would 
have far-reaching adverse economic consequences. These commenters 
stated that the elimination of the current exceptions would result in 
burdensome administrative procedures, higher transportation costs, and 
longer transportation time due to import and export barriers, 
disruptions to air freight, and increased costs of packaging, 
transport, and storage.
    Some commenters cited the impacts of this proposal on their 
industry sectors medical equipment and information technology. At the 
March 5, 2010, public meeting, as well as in written comments, they 
suggested that various aspects of the NPRM would inappropriately 
subject medical devices to the HMR and requested that PHMSA except 
finished medical devices from the HMR. The commenters stated that the 
NPRM requirements would create severe disruptions to current shipping 
practices and could threaten patient access to life-saving and life-
enhancing medical devices. These commenters further stressed the 
difference between implantable medical devices regulated by the U.S. 
Food and Drug Administration (FDA) and typical consumer products. They 
stated that medical devices are already subject to additional controls 
including registration of the manufacturing facilities, quality system 
requirements, and post market surveillance and reporting. Devices that 
pose a higher risk to a patient such as implantable medical devices 
undergo an extensive FDA pre-market approval process to establish 
reasonable assurance of safety and effectiveness of the device.
    NAM stated that the NPRM is inconsistent with other national policy 
goals because the rule would make the transport of large, advanced 
batteries used for electric and hybrid vehicles and domestic energy 
exploration more difficult and expensive. AT&T suggested that, if PHMSA 
adopts the proposed rules, the wireless business would have to make a 
dramatic shift to surface transport, which would not only delay the 
delivery of products and services to enterprise business customers, 
government agencies, and consumers, but also, more fundamentally, slow 
the velocity of competition and innovation. Moreover, customer demands 
would be met not only more slowly, but also unevenly. NetApp asserted 
that PHMSA did not adequately assess the effects of the NPRM on U.S. 
companies that manufacture and ship large equipment containing lithium 
ion batteries. NetApp stated that the proposed regulation would 
significantly impede their ability to meet customers' expedited 
delivery requirements and place them at a disadvantage relative to 
foreign manufacturers.
    NEMA strongly recommended that PHMSA and its regulatory partners 
take sufficient time to recognize the additional protection from short 
circuit or other malfunction that equipment and additional packaging 
provide to lithium batteries. NEMA suggested that PHMSA should except 
equipment and devices containing or packed with lithium batteries from 
full regulation under Class 9. RBRC stated that the limit on the number 
of batteries that can be shipped in a single package with a piece of 
equipment powered by lithium ion batteries (proposed subsections 
173.185 (b) and (c))--would preclude the collection of used cellular 
phones in

[[Page 46022]]

the same boxes with used lithium ion batteries.
    In the NPRM, PHMSA proposed specific requirements for extremely 
small batteries with very low energy (i.e. 0.3 grams lithium content 
for lithium metal or 3.7 Wh for lithium ion) when packed with or 
contained in equipment.
    Trucking, Saft, Energizer, and the RBRC strongly opposed the 
proposed elimination of the exception from the requirements of subpart 
H (``Training'') of part 172 of the HMR for both ``small'' and 
``medium'' batteries, regardless of the mode of transport. The 
commenters state that removal of these exceptions will result in a very 
significant increase in the costs associated with the supply of lithium 
cells and batteries for many important applications--including medical, 
military, security equipment, personal phones, computers, and other 
electronic devices. GE Corporation (GE) requested that, if PHMSA does 
impose training requirements on hazmat employees transporting small 
lithium cells and batteries by ground, they be similar to those 
outlined in the ICAO Technical Instructions for batteries since, in 
most instances, lithium batteries will be the only type of hazardous 
material shipped by the employees subject to these requirements. In 
this final rule, PHMSA is not imposing specific training requirements 
on shippers offering lithium batteries and battery powered devices for 
surface transport that meet all of the applicable conditions of Sec.  
173.185(c).
    In this final rule, PHMSA will not eliminate provisions for the air 
transport of small cells and batteries as originally proposed. Instead, 
we will adopt the provisions outlined in the UN Model Regulations, the 
ICAO Technical Instructions and the IMDG Code that permit the transport 
of a up to 8 lithium cells or 2 small lithium batteries (less than 1 
gram per lithium metal cell or 2 grams per lithium metal battery and 20 
Wh per lithium ion cell or 100 Wh per lithium ion battery) including 
small lithium batteries packed with, or contained in, equipment. We are 
maintaining the current prohibition from transporting lithium metal 
cells or batteries aboard passenger carrying aircraft (regardless of 
size) when the cells and batteries are not packed with or contained in 
equipment.
    We will also continue to provide exceptions from the shipping 
paper, marking, labeling, emergency response information, and training 
requirements for the transport of small and medium sized batteries by 
highway and rail only. Packages containing lithium cells and batteries 
that meet the conditions of this exception must be marked ``LITHIUM 
BATTERIES--FORBIDDEN FOR TRANSPORT ABOARD AIRCRAFT AND VESSEL.'' UPS 
suggests text markings on packages are variable and provide limited 
effectiveness. The commenter suggests a clear graphic marking will 
assist in overcoming any English-language barriers that may be faced by 
personnel loading aircraft or aircraft containers, especially when the 
shipments involved are known to move very commonly in international 
commerce. KITA, KEA, KORBA suggested that the proposed mark would 
create confusion and further suggested that PHMSA permit the air 
transport of lithium batteries consistent with the ICAO Technical 
Instructions. NEMA stated that the existing international labeling 
requirements, combined with those being proposed, would cause confusion 
in multi-modal transport as well as cross-border ground transport. The 
commenter further states that since these products are transported 
several times, by several different modes, and cross international 
borders during their journey, consistent international regulatory 
approaches ensure compatibility and that transportation risks are 
properly managed.
    PHMSA does not expect the text mark required on packages as a 
condition of this exception will cause confusion in multimodal or 
international transport because this marking would apply only in 
limited circumstances. The HMR would only require the additional text 
marking for medium-sized lithium cells and batteries transported under 
the exceptions permitted for highway and rail transport.
    In the preamble to the NPRM, PHMSA noted that the ICAO Technical 
Instructions require certain packages to display a lithium battery 
handling label.\6\ This label conveys certain information including: 
The presence of lithium batteries; the fact that a flammability hazard 
exists if damaged; instructions to package handlers in case a package 
is damaged; and a telephone number for additional information. In the 
NPRM, PHMSA noted that the ICAO lithium battery handling label conveys 
this information, and, while the HMR currently do not require the use 
of the lithium battery handling label we permit its display because it 
conveys the information required to appear on packages containing 
lithium batteries. PRBA states that PHMSA's permission for shippers to 
utilize the lithium battery handling label is misguided and would cause 
greater confusion. PRBA states the lithium battery handling label was 
adopted by ICAO to distinguish between shipments of fully-regulated 
lithium batteries and shipments of lithium batteries offered under the 
exceptions found in Packing Instructions 965-970 of the ICAO Technical 
Instructions. PRBA contends that if PHMSA includes a provision in the 
HMR that ``authorizes'' the use of the lithium battery handling label, 
it would only further confuse shippers of these products and result in 
greater non-compliance.
---------------------------------------------------------------------------

    \6\ The 2013-2014 ICAO Technical Instructions refer to a 
``lithium battery handling label.'' In this final rule, we use the 
phrase ``lithium battery handling marking'' to distinguish it from 
hazard warning labels described in Part 172, Subpart E.
---------------------------------------------------------------------------

    The HMR require certain information to appear on packages 
containing lithium batteries offered for transportation under the 
various exceptions. This required information includes an indication of 
the presence of lithium batteries and the special procedures that 
should be followed if the package is damaged. PHMSA requires the 
display of the lithium battery handling label for shipments transported 
by aircraft, but still permits voluntary use of this label by all modes 
on the basis that this label conveys the information required by the 
HMR.
    We note that the ICAO Technical Instructions and the IMDG code 
differ in the quantity limits for small lithium batteries. 
Specifically, the ICAO Technical Instructions limits a package to 8 
small lithium cells or 2 small lithium batteries, but does not impose a 
package mass limit. Conversely, the UN Model Regulations and the IMDG 
code do not limit the number of cells or batteries that can be 
contained in the package, but limits each package to 30 kg gross 
weight. We do not expect this difference between in quantity limits 
will pose significant difficulties because the cell and battery size 
and quantity limit in the ICAO Technical Instructions effectively limit 
the package weight in line with the surface modes (i.e. a package of 
lithium cells or batteries properly packaged in accordance with the 
packing instruction 965 or 968 of the ICAO Technical Instructions will 
also meet the provisions of the IMDG Code special provision 188 
including the 30 kg gross weight limit).
    In the NPRM, PHMSA requested comment on whether it should adopt an 
exception for batteries shipped at a reduced state of charge. ALPA 
recognizes that the energy in a lithium ion battery and the intensity 
of a fire involving that battery directly relates to its state of 
charge and a lower state of charge reduces the risk posed by a battery 
in transportation. However, ALPA expressed concern that incorporating 
state of charge

[[Page 46023]]

requirements in the HMR will be nearly impossible to verify or enforce. 
CERC stated that an exception for a reduced state of charge could not 
feasibly work for retailers and the millions of annual shipments of 
products to and from service centers. Additional commenters stated that 
it would be impossible for used battery collection programs to know the 
state of charge of each battery placed in collection boxes used at 
schools, libraries, and federal and state buildings throughout the U.S. 
Conversely, Quallion supported a limitation on state of charge for some 
lithium ion cells and batteries shipped by air stating that shipping at 
a lower state of charge further reduces the already-low risk of a fire 
in the event of significant damage to properly packaged products. PRBA 
states that such a limitation should not apply to batteries and 
batteries packed with, or contained in, equipment shipped for military 
or medical applications or batteries collected and shipped for 
recycling. When batteries are packed with, or contained in equipment, 
the limited additional benefit of mandatory reduced charge is overcome 
by the need for these products to work immediately when they reach 
their final destination. Due to its limited applicability and 
difficulty to verify, PHMSA will not adopt an exception based on a 
limited state of charge. However, when practical, PHMSA encourages 
shippers and manufacturers to utilize all appropriate methods, 
including shipping batteries at a reduced state of charge to help 
mitigate the hazards associated with transporting lithium batteries.
    PHMSA received several comments requesting exceptions from the HMR 
based on battery chemistry or end use. For example, SureFire 
recommended that PHMSA include exceptions for purposes of military, 
first responder, medical, and other critical applications. Control 
Technology Inc. stated that certain chemistries such as lithium iron 
phosphate (LiFePO4) are much safer than competing technologies, which 
pose far greater fire risks. Energizer requested that PHMSA except 
lithium iron disulfide (LiFeS2) batteries from the HMR when 
the batteries meet the existing requirements. This commenter cites a 
lack of incidents and recognition of overall safety and quality. 
Panasonic suggested that PHMSA except lithium manganese dioxide CR 
cells and lithium carbon monofluoride BR cells from the Class 9 
shipping requirements when the cells contain less than 1 gram lithium 
metal and are proven to have satisfactorily completed the UN tests and 
are properly packaged. The commenter added that these batteries are 
produced on automated lines in the U.S., Japan, and Indonesia and 
incorporate numerous safety features to ensure they are safe under 
abuse conditions. The same commenter further stated that these 
batteries are used in hundreds of applications ranging from acting as 
the primary power source to providing power for memory back-up. While 
PHMSA appreciates the extensive work already completed to create safer 
batteries, the fact remains that lithium batteries still pose chemical 
and electrical hazards. While certain chemistries may possess a greater 
resistance to abuse, we do not agree that it is appropriate to create 
exceptions based on specific chemistries or applications.
(d) Lithium Cells and Batteries Shipped for Disposal or Recycling
    In the NPRM PHMSA proposed to continue the exception currently in 
Sec.  173.185(d) from the UN design testing requirements and the UN 
specification packaging requirements when lithium cells or batteries 
are transported by motor vehicle for disposal or recycling. Shipments 
of lithium batteries would continue to be subject to all other 
applicable provisions of the HMR.
    GRC expressed concern that the proposed revisions do not exclude 
the responsibility for hazardous materials training for their 
suppliers. GRC stated that training in accordance with part 172, 
subpart H would be virtually impossible, given the nature of their 
participating organizations and the number of collection sites that 
include non-profits, schools, retailers, community groups, and 
businesses. CEA contended that the proposals in the NPRM will 
ultimately act as a disincentive for consumers to recycle responsibly. 
RBRC stated that, for this rule to be successful there must be a 
specific provision dealing with collection for recycling programs that 
recognizes the simple fact that most used batteries collected are, by 
their very nature, in a low state of charge.
    PHMSA agrees with the commenters that the nature of the battery 
recycling and disposal process very often make compliance with all HMR 
requirements, including hazmat employee training, difficult and, in 
many cases, unnecessary. However, PHMSA remains concerned that uneven 
compliance with basic safety requirements, such as short circuit and 
damage protection of lithium batteries, can lead to transportation 
incidents as an increasing number of lithium and other high energy 
batteries enter the waste and recycling stream. At the same time, PHMSA 
recognizes the role that battery recycling and disposal industries play 
in environmental stewardship.
    In this final rule, PHMSA continues to provide exceptions from the 
UN design testing requirements and the UN packaging requirements when 
lithium cells and batteries (including lithium cells or batteries 
contained in equipment) are transported by motor vehicle for disposal 
or recycling. Further, we are excepting offerors and carriers from the 
requirements for part 172, subparts C through H (shipping papers, 
marking, labeling, placarding, emergency response information and 
training) for appropriately packaged small and medium-sized lithium 
batteries when such batteries are offered for transport by motor 
vehicle to a permitted storage facility or for the purposes of 
recycling.
(e) Low Production Runs and Prototypes
    The HMR have separate but similar provisions for low production 
runs and prototype lithium batteries in Sec.  172.102(c), special 
provision 29, and Sec.  173.185(e), respectively. Both of these 
provisions except lithium batteries from the UN battery design testing 
requirements under certain conditions. As proposed in the NPRM, PHMSA 
is combining in Sec.  173.185(e) the conditions for the transport of 
low production runs and prototype lithium batteries that have not been 
subjected to the appropriate UN design tests, consistent with the UN 
Model Regulations.
    Johnson Controls and Saft supported the exceptions for transporting 
``prototype'' or ``low production runs'' of lithium cells or batteries. 
In particular, Saft welcomed the proposed expansion of the current 
text--which covers only prototypes--to also address the transport of 
cells and batteries produced in low production runs as such action is 
consistent with UN special provision 310. However, Saft asked PHMSA to 
authorize transport by vessel consistent with the provisions of IMDG 
Code special provision 310. PHMSA agrees with the commenter. Special 
provision 310 of the IMDG code authorizes the vessel transport of low 
production runs consisting of not more than 100 cells or batteries, or 
to prototypes.
    Saft also proposed adding a new paragraph to authorize non-
specification packaging for batteries employing a strong, impact-
resistant outer casing and exceeding a gross weight of 12 kg (26.5 
pounds), and assemblies of such batteries when transported by highway 
and rail. It stated that many of the newer prototype or low production 
lithium

[[Page 46024]]

batteries are of such a size that use of UN standard packagings as 
would otherwise be required would be impractical for the same reasons 
that use of such packaging is impracticable for UN-tested batteries of 
similar size.
    PHMSA agrees such a provision would facilitate the transport of 
large, robust lithium batteries without sacrificing safety. In this 
final rule, we are adding a provision to authorize non-specification 
packaging for low production and prototype lithium metal and lithium 
ion batteries employing a strong, impact-resistant outer casing and 
exceeding a gross weight of 12 kg (26.5 pounds), and assemblies of such 
batteries. In this final rule PHMSA authorizes such packaging for 
transport by highway, rail and vessel consistent with special provision 
310 of the IMDG Code. PHMSA continues to forbid transport of lithium 
batteries in these non-specification packages by passenger-carrying 
aircraft and only permits transport by cargo air when approved by the 
Associate Administrator prior to transport.
(f) Damaged Defective or Recalled Batteries
    Lithium batteries and devices are returned to manufacturers and 
retail outlets for a variety of reasons including product returns, 
warranty fulfillment, repair, failure during field testing, or a 
manufacturer recall. The HMR do not currently contain provisions for 
transporting batteries subject to a manufacturer's recall or that are 
damaged and potentially dangerous. Based on previously developed 
guidance material and competent authority approvals, PHMSA will require 
lithium batteries that have been damaged, identified as being 
defective, or are otherwise being returned to the manufacturer for 
safety reasons, to be packaged in combination packages, surrounded by 
non-conductive cushioning material, and transported by highway or rail 
only. PHMSA and the FAA would address situations requiring air 
transport on a case-by-case basis by Approval.
    Most commenters generally supported these proposals. However, they 
expressed concern that the words ``damaged'' or ``defective'' may be 
subject to misinterpretation. For example, scratches or other cosmetic 
damage to a battery casing, or, for large batteries, damage to external 
structural features such as bolt-down lugs, would not constitute damage 
that affects the safety of the battery in transport. PRBA suggested 
clarifying language stating that damaged, defective, or recalled 
batteries which do not have the potential of producing a dangerous 
evolution of heat, fire or short circuit are not subject to the 
paragraph. PRBA stated that this would allow companies to ship 
batteries by air that simply are not working to specification, but 
which pose no additional safety risk in transport. PRBA states this 
option is necessary for many reasons, but is most important for 
batteries designed for use in medical and military applications. For 
example, if a battery is not working to specifications in such 
lifesaving applications as defibrillators, it is critically important 
for the battery to be quickly returned to the manufacturer for 
analysis. Special provision A154 in the ICAO Technical Instructions 
states that batteries are prohibited from transport by aircraft only to 
the extent that any damage or defect causes the battery to ``have the 
potential of producing a dangerous evolution of heat, fire or short 
circuit.''
    UPS also supported PHMSA's proposal, but noted that the provision 
does not appear to provide a viable means of transport for residents of 
Alaska, Hawaii, Puerto Rico and others not accessible by the highway 
and rail system. Horizon Air and Rep. Don Young request exceptions for 
communities such as those in Alaska not accessible by surface 
transportation. These commenters suggested that PHMSA add a provision 
stating that damaged defective or recalled batteries are not permitted 
for transportation by passenger-carrying aircraft and may be 
transported by cargo aircraft only if approved by the Associate 
Administrator prior to transportation. NITL, NEMA and others stated 
that an option to transport these batteries by cargo vessel is 
necessary to enable returns from overseas if the air mode is not 
available. Several other commenters stated that failure to allow a mode 
that will enable returns from overseas will be counterproductive, since 
it will prevent battery companies from fully investigating and 
analyzing product defects or failures.
    In response to these comments, PHMSA is authorizing the transport 
of damaged, defective or recalled cells or batteries by highway, rail, 
or vessel when the batteries are packaged in specification packagings 
and each battery is individually placed into inner packagings 
surrounded by cushioning material that is non-combustible, and non-
conductive. PHMSA is adopting language consistent with the ICAO 
Technical Instructions that prohibit the air transport of lithium cells 
or batteries that are subject to a safety recall or batteries that have 
been damaged and have the potential of producing a dangerous amount of 
heat or fire. PHMSA will evaluate the need to transport such cells or 
batteries by aircraft on a case-by-case basis by Approval.
Section 173.219 Life-Saving Appliances
    Section 173.219 requires life-saving appliances containing lithium 
batteries to be transported in accordance with Sec.  173.185 of the HMR 
and special provisions 188, 189, A101, A103 and A104 as applicable. 
PHMSA did not receive comments specific to the transport of life-saving 
appliances. In this final rule, PHMSA is revising this section 
consistent with other changes in this final rule. Lithium batteries 
packed with, or contained in, life-saving appliances must meet the 
applicable requirements of Sec.  173.185 and special provisions A54 and 
A101.
Section 173.220 Vehicles
    Section 173.220 contains conditions and exceptions applicable to 
the transport of vehicles and machinery, including those powered by 
lithium batteries. In the NPRM, PHMSA proposed to except prototype 
lithium batteries from the UN design testing requirements when these 
vehicles are transported by highway for product testing. The batteries 
would be required to be securely installed in the vehicle. Commenters 
supported this proposal and no objections were raised. PHMSA is 
adopting this exception as proposed.

D. Part 175

Section 175.8 Exceptions for Operator Equipment and Items of 
Replacement
    In Sec.  175.8, PHMSA provides exceptions for operator equipment 
and items of replacement. In the NPRM, PHMSA proposed to modify Sec.  
175.8 to permit airlines to carry additional items approved by the FAA 
Administrator for use aboard the aircraft. This proposal was in 
response to the December 15, 2008, petition for rulemaking (P-1533) 
from A4A and the RAA. The petition requested that PHMSA amend the HMR 
to permit airlines to carry a limited number of small lithium batteries 
in the aircraft cabin in a constant state of readiness with adequate 
backup power for the duration of the flight. PHMSA agreed with 
airlines' need to maintain and use various types of equipment in the 
cabin, which are increasingly powered by lithium batteries.
    Commenters generally supported the proposals to permit airlines to 
carry lithium batteries in the cabin to power devices such as 
electronic flight bags, onboard medical monitoring devices,

[[Page 46025]]

and credit card readers. Southwest supported the proposed revision of 
Sec.  175.8 for operator equipment and items of replacement, but 
suggested that the regulation should clearly identify which branch of 
the FAA will act on a request for an approval (Certificate Management 
Office, Flight Standards, Hazmat Branch Managers, etc.), and that the 
approval process should provide for review and feedback in a timely and 
consistent manner. Three commenters requested that PHMSA clarify the 
wording ``Items containing hazardous material'' and suggested that this 
wording would preclude spare lithium batteries for required devices. On 
September 23, 2009, the FAA published a document Information for 
Operators (InFO) that discusses the appropriate regulations applicable 
to the operation of portable electronic devices aboard aircraft. This 
InFo is available through the FAA at the following URL: http://www.faa.gov/other_visit/aviation_industry/airline_operators/airline_safety.
    In response to the commenters' PHMSA is revising the proposed Sec.  
175.8(a)(4) to read ``hazardous materials used by the operator aboard 
the aircraft when approved by the Administrator of the Federal Aviation 
Administration.'' This will permit operators to carry hazardous 
material used by the flight crew as appropriate, subject to approval by 
the Administrator of the FAA.
Section 175.10 Exceptions for Passengers
    In Sec.  175.10, the HMR provide conditions and exceptions for the 
transport of certain hazardous materials when carried by aircraft 
passengers or crewmembers in checked and carry-on baggage. In the NPRM, 
PHMSA proposed to require lithium batteries carried by a passenger or a 
crewmember in checked or carry-on baggage to be of a type proven to 
meet each of the appropriate tests outlined in the UN Manual of Tests 
and Criteria.
    PRBA supported PHMSA's proposal. DGAC stated that, while it would 
expect cells and batteries would meet the UN testing requirements, it 
wonders how passengers would actually know whether their batteries were 
tested. In addition, it questions how such a requirement would apply to 
passengers arriving from outside the United States. The 2013-2014 ICAO 
Technical Instructions already include the requirement for the 
manufacturer to test lithium cells and batteries, and all lithium 
batteries must already be of a design that meets each test in the UN 
Manual of Tests and Criteria prior to being offered for transportation. 
Accordingly, we do not anticipate any adverse impact to harmonizing the 
provisions of the HMR with the provisions of the ICAO Technical 
Instructions at this point.
    NFDA asked PHMSA to insert the words ``living or deceased'' before 
the word ``humans'' in Sec.  175.10(a)(3), in order to clarify that 
implanted medical devices in a deceased human body being transported by 
an air carrier falls under the exception currently available for living 
humans. The provisions in Sec.  175.10(a)(3) applicable to implanted 
medical devices in humans or animals does not specify the condition of 
the human or animal. Thus this provision already permits implanted 
medical devices regardless of whether the human or animal is alive or 
deceased.
    PRBA and others note the HMR currently authorize a passenger to 
carry lithium ion batteries up to 300 Watt-hours, but the ICAO 
Technical Instructions limit a passenger to carry lithium ion batteries 
up to 160 Watt-hours and requires authorization of the airline if the 
battery is over 100 Watt-hours. The commenters state this should be 
changed to harmonize with the ICAO Technical Instructions. We agree and 
in this final rule we are revising Sec.  175.10 to state, when approved 
by the air operator, up to two individually protected spare lithium ion 
batteries per person having a Watt-hour rating greater than 100 Wh, but 
not greater than 160 Wh, may be carried in (a) carry-on baggage, or (b) 
equipment in either checked or carry-on baggage.
    PRBA and NEMA also noted that PHMSA also has included a provision 
that appears to prohibit spare ``dry cells and batteries'' (e.g., 
alkaline, nickel cadmium, nickel metal hydride) from placement in 
checked baggage. NEMA opposed any such prohibition and states that non-
lithium dry cell batteries, even when new and deliberately shorted in 
large quantities cannot produce dangerous levels of heat. PRBA asked 
PHMSA to clarify whether we intended to prohibit dry cell batteries 
from checked baggage. They state this would be an impossible provision 
to enforce considering the millions of alkaline batteries purchased by 
consumers every year in the U.S. and is unnecessary in light of the 
battery's low voltage. PHMSA did not intend to limit the ability of 
passengers to carry spare non-lithium dry cell batteries to carry-on 
baggage. In this final rule, PHMSA is revising Sec.  175.10(a)(18) to 
specify each spare lithium battery must be carried in carry-on baggage 
only.
Section 175.30 Inspecting Shipments
    Section 175.30 establishes requirements for acceptance and carriage 
of hazardous materials by aircraft. We are adding a new paragraph 
(a)(5) to this section to specify that the air carrier must not accept 
a lithium battery shipment described on alternative written 
documentation unless it is in compliance with Sec.  
173.185(c)(4)(v)(B).
Section 175.33 Shipping Paper and Notification of the Pilot-in-Command
    Section 175.33 establishes requirements for a shipping paper to 
accompany an air shipment of hazardous materials and for the aircraft 
operator to notify the pilot-in-command of the specific information 
about the hazardous materials to be transported on the aircraft. We are 
adding a new paragraph (a)(12) to this section to specify that the air 
carrier must notify the pilot-in-command of the UN number, the hazard 
class, the number of packages, and the gross mass of every package for 
each shipment of lithium batteries containing more than 2 small lithium 
batteries or 8 small lithium cells in any package that otherwise meet 
the requirements of Sec.  173.185(c). We are also adding a new 
paragraph (c)(5) to this section to specify that when alternative 
written documentation is supplied by the shipper in accordance with 
Sec.  173.185(c)(4)(v)(B), the operator must retain this documentation 
for 90 days.
Section 175.75 Quantity Limitations and Cargo Location
    In Sec.  175.75, the HMR prescribe quantity limits and stowage 
locations for various hazardous materials aboard an aircraft. In the 
NPRM, PHMSA proposed to modify Sec.  175.75 to prohibit the stowage of 
lithium batteries in an inaccessible manner, unless the inaccessible 
cargo compartment or freight container was equipped with an FAA-
approved fire suppression system or the lithium batteries were packaged 
in an FAA-approved fire resistant container. We also invited comments 
on whether limiting the number of lithium batteries in a single 
aircraft, compartment, or unit load device would further enhance 
safety.
     Stowage Location.
    Our proposal to restrict locations for stowage of lithium batteries 
onboard an aircraft was based on NTSB recommendations A-07-104 and A-
07-105 and FAA testing that demonstrated that lithium batteries are a 
potential fire source and can also enhance the severity of a fire from 
an outside source.

[[Page 46026]]

While the cargo compartments of passenger aircraft are required to be 
equipped with fire suppression systems, and some cargo-only aircraft 
are equipped with FAA-approved fire suppression systems, the specific 
number of such cargo-only aircraft remains unknown. The NTSB stated 
that it believes this leaves flight crews on cargo-only aircraft at 
risk from in-flight fires involving both primary and secondary lithium 
batteries.
    PHMSA received many comments on these proposals from a variety of 
sources including passenger airlines, express air carriers, medical 
device manufacturers, retailers, airline pilot organizations, the NTSB, 
members of the U.S. House of Representatives, battery and electronic 
equipment manufacturers, and others who ship lithium batteries and 
lithium battery powered equipment. While some welcomed the proposed 
requirements, most commenters opposed additional loading and 
segregation requirements. These commenters stated that the proposed 
additional requirements are unnecessary, and would impose significant 
cost and logistical hurdles on air carriers resulting in delays, 
frustrated shipments, and other adverse distributional effects.
    The NTSB, ALPA, TDD and IFALPA support additional controls on the 
stowage of lithium batteries aboard aircraft. These commenters stated 
that the quantity of lithium batteries in any single location, or in a 
single cargo compartment, must be restricted to mitigate the 
consequences of an incident by controlling the number of batteries in 
close proximity to each other. ALPA stated that it is vitally important 
to limit the quantity of lithium ion batteries stored in a single 
location as well as in a single cargo compartment. ALPA supported this 
statement by saying that, since a fire may be the result of an internal 
short circuit, defective design, or counterfeit battery, no amount of 
packaging or training will prevent every incident; however, the 
severity of an incident may be effectively managed by controlling the 
number of batteries in close proximity to each other.
    ALPA and TDD do not support any proposal that permits the placement 
of lithium ion batteries in an accessible cargo position as an 
alternative to stowing the batteries in a Class C cargo compartment. 
ALPA stated that, if a Class C compartment does not exist on an 
aircraft, PHMSA should not permit shipments of these batteries on board 
the aircraft unless additional testing determines that they can be 
safely transported in a Class E cargo compartment. ALPA and TDD stated 
that, if a fire were to occur in an accessible location, it is unlikely 
that a crewmember would attempt to extinguish the fire using a hand-
held halon fire extinguisher.
    NTSB noted in its comments that halon fire suppression is 
ineffective on fires involving lithium metal batteries and suggested 
that PHMSA could improve the NPRM by explicitly requiring shipments of 
lithium metal batteries to be loaded in FAA-approved fire resistant 
containers. Several commenters, including AfA, TIA, AHS, A4A, NAC, and 
TIACA, questioned the proposal to permit an FAA-approved container for 
the purposes of transporting lithium batteries. These commenters 
suggest that unless PHMSA identifies a suitable container or criteria 
for such a container, this option does not offer any relief.
    More commenters opposed additional loading and segregation 
requirements. These commenters stated that the proposed additional 
requirements are unnecessary, and would impose significant cost and 
logistical hurdles on air carriers resulting in delays, frustrated 
shipments, and other adverse distributional effects. A number of them, 
including airlines, express air carriers, retailers, medical and other 
equipment manufacturers, expressed concerns about the impact of stowage 
restrictions on aircraft cargo capacity. Saft and IATA stated that, 
unlike passenger-carrying aircraft, many existing cargo aircraft do not 
have, and are not required to be fitted with, Class C cargo 
compartments. Therefore, if the stowage requirements outlined in the 
NPRM were finalized, such cargo-only aircraft could only carry lithium 
batteries in an accessible location. FedEx and others stated that a 
requirement for lithium ion batteries to be accessible would place them 
together with other highly regulated and flammable substances, 
increasing the potential for igniting or increasing the severity of an 
onboard fire. Similarly, UPS stated that the proposed stowage 
requirements would have the practical effect of making crew accessible 
positions the most common method of handling lithium batteries and 
devices shipped with them. Currently, very few positions on UPS 
aircraft are accessible, and typically UPS reserves such positions for 
high-hazard materials currently subject to accessibility requirements. 
UPS further stated that such consolidation may present commercial 
issues to air carriers whose customers may, for sanitation and other 
reasons, seek to forbid locating their lithium battery-powered products 
near traditional cargo aircraft-only shipments. These commenters stated 
that such restrictions will likely result in aircraft operators 
electing to simply ban the transport of such materials or load these 
products on passenger-carrying aircraft rather than run the risk of 
non-compliance with the HMR.
    Digital Europe asked PHMSA to consider that only bulk shipments of 
lithium batteries should potentially require additional stowage and 
segregation. It asserts that, by volume, lithium batteries contained in 
equipment will put the most demand on crew accessible stowage. Casio 
stated that lithium ion batteries packed with, or contained in, 
products constitute a small volume of the overall package and a 
restriction that includes batteries packed with or contained within 
products may have a significant impact on the availability of cargo 
space. NetApp illustrated this fact with their experience shipping 
large equipment that also contains several small lithium batteries.
    CIPA and Olympus stated that if one cell or battery causes a fire 
within a package complying with the ICAO Technical Instructions, the 
fire will self-terminate without spreading to other batteries or the 
contents of the same package. Accordingly, there is no need for 
additional restrictions. Air carriers, including UPS, FedEx, Delta and 
Southwest, stated that the proposed restrictions would further 
complicate the loading process and require an overhaul of training and 
operational procedures. Delta and others commented that the HMR 
currently impose compartment limits at the hazard class or division 
level, but not to specific UN numbers. They stated that, since the HMR 
do not impose loading restrictions on Class 9 material, PHMSA must 
establish loading limits for lithium batteries specific to those UN 
numbers. Subsequently, each carrier would then be required to develop a 
process to ensure compliance with this regulation. These commenters 
stated that managing such accessibility limitations at the UN number 
level would impose great difficulties on air carriers.
    UPS stated that its loaders would be required to scrutinize the UN 
number and proper shipping names marked on all Class 9 shipments in 
order to identify those packages subject to new accessibility 
requirements. In addition, UPS stated that it will need to reprogram 
electronic systems developed to support the loading of aircraft unit 
load devices (ULDs) and aircraft, as well as generate a notice to the 
pilot, specifically to address the lithium battery specific 
requirements. Alaska Airlines, Horizon Air, and NAC

[[Page 46027]]

proposed creating an additional hazard class for lithium batteries if 
loading limits are needed, thereby reducing the complications 
associated with segregating packages based on the UN number. While a 
separate hazard class for lithium batteries would assist in 
identification, and subsequent segregation, of such packages for 
transport, PHMSA does not believe creating a new hazard class for a 
single commodity is appropriate.
    VFS stated that it is developing a ULD that has a means to alert a 
pilot or flight crewmember of the presence of smoke and control or 
extinguish a fire inside of a ULD without requiring a crewmember to 
enter the compartment. PHMSA and FAA applaud these efforts and welcome 
such innovations.
     Quantity Limits.
    In response to PHMSA's invitation for comments on limiting the 
number of lithium batteries in a single aircraft, compartment, ULD, 
pallet, or similar overpack, IATA and TTi stated that the guiding 
principle established in the ICAO Technical Instructions is that 
packaging requirements and the package limits for hazardous materials 
reduce the hazard in air transport to an acceptable level. On that 
basis, there is no limit on the number of individual packages of 
hazardous materials that may be transported in a single aircraft, 
single cargo compartment, or ULD unless there is a need to separate or 
segregate packages containing incompatible hazardous materials.
    PRBA stated that there is no reasonable basis to limit the number 
of lithium ion or metal battery packages in a single aircraft cargo 
compartment, ULD, or overpack. PRBA expanded on this by stating that 
the HMR already contain: (1) Strict weight restrictions on these 
packages; (2) quantity limits for batteries packed with, or contained 
in, equipment; and (3) a prohibition against shipping lithium metal 
batteries on passenger-carrying aircraft. These restrictions adequately 
address what PRBA understands to be PHMSA's justification for this 
proposal, i.e., to mitigate the consequences of a fire involving 
lithium ion and lithium metal batteries. NEMA echoed these statements 
by commenting that, if a package is properly packaged and labeled in 
compliance with the current regulations, it should be allowed to ship 
without any further restrictions. Delta questioned the basis upon which 
PHMSA and FAA would formulate a compartment limit.
    PHMSA and FAA continue to study these issues and will take into 
consideration new suppression systems and agents as they become 
available in the future. We are not adopting stowage restrictions or 
limits on the number of for lithium batteries in a single aircraft, 
aircraft compartment, ULD, pallet or overpack.

E. Compliance Date

    PHMSA's January 11, 2010, NPRM proposed a 75-day period for 
affected entities to come into compliance with the provisions of the 
NPRM. ALPA favored expedited compliance with the safety regulations, 
stating that the provisions, once enacted, would have a significant 
positive impact on safety and may preclude the need to prohibit the 
transport of lithium batteries aboard aircraft. However, nearly all 
other commenters opposed the 75-day period for compliance with the 
requirements outlined in the NPRM. These commenters stated that a 12-18 
month compliance period would be required if PHMSA adopted the 
provisions of the NPRM. The commenters noted various barriers to 
immediate compliance including training hazmat employees, certifying 
packaging, obtaining various approvals, and modifying their logistical 
operations.
    The provisions of this final rule harmonize the HMR with the UN 
Model Regulations, the ICAO Technical Instructions, and the IMDG Code, 
so we do not anticipate significant barriers to compliance. In the 
April 2012 notice, we requested comments on ways to reduce the 
compliance burden should PHMSA adopt in a final rule the ICAO 
revisions. Outside of a delayed effective date, commenters did not 
provide any comment on ways that PHMSA could reduce the burden or costs 
of implementation of a final rule. Most commenters supported a January 
1, 2013, effective date since the 2013-2014 ICAO Technical Instructions 
also become effective on January 1, 2013. Commenters suggested that 
PHMSA provide a suitable grace period to allow shipments that were 
initiated prior to January 1st to reach their destination. Others 
suggest longer grace periods between one month and 18 months. The 
delayed effective date would permit the incorporation of new 
requirements into standard operating procedures and for the training of 
affected personnel.
    In order to facilitate harmonization, and permit the acceptance of 
lithium battery shipments made in accordance with the 2013-2014 ICAO 
Technical Instructions, PHMSA permits immediate voluntary compliance 
with all of the provisions in this final rule. PHMSA will not require 
compliance with the requirements of this final rule until six months 
after publication in the Federal Register.

IV. Regulatory Analyses and Notices

A. Statutory/Legal Authority for This Rulemaking

    This final rule is published under the following statutory 
authorities:
    1. 49 U.S.C. 5103(b) authorizes the Secretary of Transportation to 
prescribe regulations for the safe transportation, including security, 
of hazardous material in intrastate, interstate, and foreign commerce.
    2. 49 U.S.C. 44701 authorizes the Administrator of the Federal 
Aviation Administration to promote the safe flight of civil aircraft in 
air commerce by prescribing regulations and minimum standards for 
practices, methods, and procedures that the Administrator finds 
necessary for safety in air commerce and national security. Under 49 
U.S.C. 40113, the Secretary of Transportation has the same authority to 
regulate the transportation of hazardous materials by air, in carrying 
out Sec.  44701, that he has under 49 U.S.C. 5103.
    3. 49 U.S.C. 5120(b) authorizes the Secretary of Transportation to 
ensure that, to the extent practicable, regulations governing the 
transportation of hazardous materials in commerce are consistent with 
standards adopted by international authorities. This rule amends the 
HMR to maintain alignment with international regulatory approaches by 
incorporating various amendments to facilitate the transport of 
hazardous material in international commerce. To this end, as discussed 
in detail above, the rule incorporates changes into the HMR found in 
the 5th revised edition of the UN Manual of Tests and Criteria, the 
seventeenth revised edition of the UN Recommendations, Amendment 36-12 
to the IMDG Code, and the 2013-2014 ICAO Technical Instructions, which 
became effective January 1, 2013.
    4. Section 828 ``FAA Modernization and Reform Act'' (Pub. L 112-95; 
126 Stat. 133 (Feb 14, 2012)) prohibits DOT agencies from issuing or 
enforcing regulations regarding the air transport of lithium cells or 
batteries, whether transported separately or packed with, or contained 
in, equipment, if the requirement is more stringent than the 
requirements of the ICAO Technical Instructions. However, the 
legislation authorizes the continued prohibition on the transport of 
lithium metal cells and batteries aboard passenger aircraft and 
authorizes the issuance of more stringent regulation based on credible 
reports that lithium batteries substantially contributed to the 
initiation or propagation of a fire aboard an aircraft. Such 
regulations must address solely the deficiencies

[[Page 46028]]

referenced in the report and must be the least disruptive and least 
expensive variation from existing requirements while adequately 
addressing identified deficiencies.

B. Executive Order 12866, Executive Order 13563, and DOT Regulatory 
Policies and Procedures

    This final rule is considered a significant regulatory action under 
Executive Order 12866 and the Regulatory Policies and Procedures of the 
Department of Transportation (44 FR 11034) because of significant 
public interest. A regulatory impact assessment is available for review 
in the public docket for this rulemaking.
    Executive Orders 12866 and 13563 require agencies to regulate in 
the ``most cost-effective manner,'' to make a ``reasoned determination 
that the benefits of the intended regulation justify its costs,'' and 
to develop regulations that ``impose the least burden on society.'' In 
this final rule, PHMSA is amending the HMR to harmonize requirements 
for the transport of lithium batteries with requirements in the UN 
Model Regulations, 2013-2014 ICAO Technical Instructions, and the IMDG 
Code by: (1) Adopting separate shipping names for (i) lithium metal 
batteries, lithium metal batteries contained in equipment, and lithium 
metal batteries packed with equipment; and (ii) lithium ion batteries, 
lithium ion batteries contained in equipment, and lithium ion batteries 
packed with equipment; (2) adopting ``Watt-hours'' as the measure of 
the size of a lithium ion battery to replace the current use of 
``equivalent lithium content;'' (3) revising various definitions 
consistent with the UN Model Regulations; (4) adopting into the HMR the 
ICAO exception for packages containing up to 2 small lithium batteries 
or 8 small lithium cells; (5) for lithium ion batteries that meet the 
conditions in the exception, requiring each package to bear a lithium 
battery handling label; and (6) revising package weight limits 
applicable to different lithium battery types and configurations.\7\ 
PHMSA is retaining its prohibition on the transport of lithium metal 
batteries aboard passenger aircraft. PHMSA considered three potential 
regulatory options.
---------------------------------------------------------------------------

    \7\ In this document, ``configurations'' refers to the relevance 
of differences between batteries-only shipments, batteries packed 
with equipment, and batteries contained in equipment.
---------------------------------------------------------------------------

     Option 1 is a no-action option. This would retain the 
current provisions applicable to lithium batteries. All costs and 
benefits are relative to this option.
     Option 2 would amend the HMR applicable to the transport 
of lithium cells and batteries consistent with the UN Model 
Regulations, the ICAO Technical Instructions and the IMDG Code. This 
option would provide an exception for shipments of a limited number of 
small lithium batteries and battery powered equipment, but retains the 
current prohibition on the transport of lithium metal batteries aboard 
passenger aircraft.
     Option 3 would eliminate the regulatory exceptions for 
small lithium batteries--including batteries packed with, or contained 
in, equipment--and require their shipment as fully regulated Class 9 
materials. This option would additionally (1) modify the design change 
criteria in the UN Manual of Tests and Criteria; (2) require lithium 
cells and batteries to be marked with an indication that the cell or 
battery design that passed each of the appropriate tests outlined in 
the UN Manual of Tests and Criteria and (3) limit the locations on 
board aircraft where shipments of lithium cells and batteries could be 
stowed.
    PHMSA has chosen the Option 2--harmonization with UN Model 
Regulations, the ICAO Technical Instructions and the IMDG Code. This 
option was constructed with the input of stakeholders representing the 
aviation, manufacturing, and shipping industries, as well as 
international governments and safety agencies. It is the result of 
compromise directed at producing a strong yet flexible regulation and 
reflects Congressional intent and stakeholders' need for a global 
standard.
    To evaluate the impact of the rule, PHMSA used market research and 
information provided by commenters to the April 11, 2012, notice to 
project the total numbers of packages and shipments that the regulation 
would affect. PHMSA first quantified the number of lithium batteries 
transported to or from the U.S., and then estimated the number of 
shipments potentially affected by this rule. Trade data from 2011 were 
inflated assuming a constant 10% growth rate, with an expected 2.8 
billion batteries, packed in nearly 1.1 million shipments, moving to or 
through the U.S. for the decade spanning 2014 to 2023. The following 
table shows the 10-year projected number of lithium battery shipments 
potentially affected by this rule.

------------------------------------------------------------------------
                                             Batteries
                2014-2023                   (millions)       Shipments
------------------------------------------------------------------------
Imports.................................         2,836.1         710,626
Domestic origin.........................             2.6         436,814
                                         -------------------------------
    Total...............................         2,838.8       1,147,440
------------------------------------------------------------------------

    Lithium batteries imported into the U.S. over the next 10 years are 
considered to be consolidated into shipments holding an average of 
4,000 batteries each (based on historical data), whereas anecdotal 
evidence from commenters engaged in domestic custom battery production 
indicated that their shipments were mostly small runs of specialized 
batteries, with an average of a half dozen batteries per package.
    Due to uncertainty inherent in much of the data collected for this 
analysis, we have used a probabilistic method observing the overall 
distribution of possible costs to observe the range of potential 
outcomes resulting from adoption of the provisions in the final rule. 
Figures listed here are mean (average) costs.
    Costs resulting from the regulatory changes are the sum of: Hazard 
communication costs, including labeling, documentation, and package 
inspection; training and employment costs; and cost associated with the 
generation and retention cell/battery design testing records 
information. Hazard communication broadly refers to package markings, 
labels, documentation, and acceptance checks. The hazard communication 
cost increases, as a result of adopting the provisions of the new rule, 
would be calculated by multiplying the number of shipments required to 
comply with enhanced hazard communication

[[Page 46029]]

requirements by the increased cost per shipment. Training costs would 
be limited to a one-time expenditure by shippers to familiarize staff 
with the new regulations, while carriers would be presumed to undergo 
supplemental training on the revised ICAO Technical Instructions, 
regardless of U.S. action in a final rule. Cost associated with battery 
design testing would be a nominal sum resulting from the generation of 
battery design testing records. Using both 3% and 7% annual discounting 
for future costs, the total present value mean cost of the regulation 
from 2014 to 2023 is expected to be between $10.1 million (at 7% 
discount) and $11.2 million (at 3% annual discount), with a possible 
range of $6.9 million to $15.3 million in 2013 dollars.
    Benefits for this rulemaking are based on the potential to avert 
consequences from catastrophic incidents that would otherwise occur 
without the provisions of the rule. However, due to the inherent 
uncertainty of potential and averted consequences, quantification of 
the benefits is so imprecise that PHMSA elected not to estimate them. 
PHMSA has instead elected to engage in a break-even analysis to 
determine the threshold safety benefit that would make this rule cost 
beneficial. This estimation still requires PHMSA to estimate the 
expected cost of aircraft incidents involving lithium batteries.
    PHMSA weighs the relative probabilities of an incident occurring on 
a cargo-only aircraft and a passenger aircraft by assuming on average 
an 80% chance of an incident occurring onboard a cargo-only and 20% 
chance on a passenger flight. This roughly matches the proportion of 
total cargo that is carried on cargo-only aircraft and passenger 
aircraft. The average expected incident has costs of $354 million, 
which is $302 million when discounted at 3 percent, and $279 million 
when discounted at 7 percent.
    Table 3-2-3 presents the number of incidents that would need to be 
prevented in order for this rule to be cost-beneficial. For instance, 
using the base case for costs, this rule would need to prevent more 
than 0.041 incidents over the next 10 years, discounted at 3 percent, 
for the benefits to exceed the costs.

      Table 3-2-3--Break-Even Points, Number of Incidents Prevented
------------------------------------------------------------------------
                                           Discounted 3%   Discounted 7%
------------------------------------------------------------------------
Low cost estimate.......................           0.029            0.03
Base case cost estimate.................           0.041           0.043
High case cost estimate.................           0.056           0.061
------------------------------------------------------------------------

C. Executive Order 13132

    The requirements in this rule will preempt state, local, and Indian 
tribe requirements but do not have substantial direct effects on the 
States, the relationship between the national government and the 
States, or the distribution of power and responsibilities among the 
various levels of government. Therefore, the consultation and funding 
requirements of Executive Order 13132 do not apply.
    The Federal hazardous materials transportation law, 49 U.S.C. 5101 
et seq., contains an express preemption provision (49 U.S.C. 5125(b)) 
preempting State, local, and Indian tribe requirements on the following 
subjects:
    (1) The designation, description, and classification of hazardous 
materials;
    (2) The packing, repacking, handling, labeling, marking, and 
placarding of hazardous materials;
    (3) The preparation, execution, and use of shipping documents 
related to hazardous materials and requirements related to the number, 
contents, and placement of those documents;
    (4) The written notification, recording, and reporting of the 
unintentional release in transportation of hazardous material; or
    (5) The design, manufacture, fabrication, marking, maintenance, 
recondition, repair, or testing of a packaging or container 
represented, marked, certified, or sold as qualified for use in 
transporting hazardous material.
    Federal hazardous materials transportation law provides at 49 
U.S.C. 5125(b)(2) that, if DOT issues a regulation concerning any of 
these subjects, DOT must determine and publish in the Federal Register 
the effective date of Federal preemption. The effective date may not be 
earlier than the 90th day following the date of issuance of the final 
rule and not later than two years after the date of issuance.
    This final rule addresses subject items (1), (2), (3), and (4) 
above and preempts State, local, and Indian tribe requirements not 
meeting the ``substantively the same'' standard. The effective date of 
Federal Preemption is November 4, 2014.

D. Executive Order 13175

    This final rule was analyzed in accordance with the principles and 
criteria contained in Executive Order 13175, Consultation and 
Coordination with Indian Tribal Governments. Because this final rule 
does not have tribal implications and does not impose substantial 
direct compliance costs, the funding and consultation requirements of 
Executive Order 13175 do not apply.

E. Regulatory Flexibility Act, Executive Order 13272, and DOT 
Procedures and Policies

    This final rule has been developed in accordance with Executive 
Order 13272, Proper Consideration of Small Entities in Agency 
Rulemaking, and DOT's procedures and policies to promote compliance 
with the Regulatory Flexibility Act (Pub. L. 96-354) and to ensure 
potential impacts of rules on small entities are properly considered. 
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires an 
agency to review regulations to assess their impact on small entities, 
unless the agency determines that a rule is not expected to have a 
significant impact on a substantial number of small entities.
1. Need for and Objectives of the Rule
    The intent of this action is to align the HMR with international 
transport standards and requirements to the extent practicable in 
accordance with Federal Hazardous Materials transportation law (see 49 
U.S.C. 5120). Our goal is to harmonize, without diminishing the level 
of safety currently provided by the HMR, and not impose undue burdens 
on the regulated public. This action is necessary to incorporate 
changes adopted in the UN Recommendations on the Transport of Dangerous 
Goods--Model Regulations, the ICAO's Technical Instructions for the 
Safe Transport of Dangerous Goods by Air, and the IMDG Code, effective 
January 1, 2013.

[[Page 46030]]

2. Comments to the Initial Regulatory Flexibility Analysis
    PHMSA received comments on the initial regulatory flexibility 
analysis from industry trade associations and SBA. Small businesses 
including Fedco and ICCNexergy added figures detailing their expected 
burden.
    SBA and PRBA stated that the proposed rules would create 
conflicting standards and require significant supply chain redesigns. 
Further, SBA stated that the initial regulatory flexibility analysis 
understated the number of, and impact on, small businesses that support 
the retail sector, including internet shippers, manufacturers of 
battery packs, shipping companies, and airlines that handle lithium 
batteries or electronic devices containing lithium batteries. SBA 
recommended that PHMSA conduct further outreach to the regulated 
community to enhance dialogue, promote safety and ensure harmonization.
    We have been attentive to the concerns of small businesses through 
the preparation of the rule and its supporting analyses. Data provided 
by several commenters suggested that a significant percentage of 
lithium batteries transported in the U.S. affected by this rule are 
packed with, or contained in, equipment and often those pieces of 
equipment only contain one device per package. When developing the 
rule, PHMSA examined alternatives for reducing the regulatory 
compliance burden on small entities, including providing exceptions for 
certain finished medical devices and extending the compliance date to 
permit extra time for small entities to come into compliance. In this 
final rule, we are maintaining existing exceptions:
     For the transport of lithium batteries by modes other than 
aircraft (i.e. highway, rail and vessel), including batteries packed 
with, or contained in, equipment; and
     for the air transport of packages containing up to 8 small 
lithium cells or 2 small lithium batteries and lithium batteries packed 
with, or contained in, equipment.
3. Description and Estimate of the Number of Small Entities to Which 
the Final Rule Will Apply
    Two types of small businesses are likely to incur costs associated 
with compliance with the provisions of this rule--(1) manufacturers and 
distributors of lithium batteries and (2) air carriers. We employ the 
thresholds published by the Small Business Administration for 
industries subject to the HMR--generally, this includes those that have 
up to 500 employees. Our research has identified 130 possible entities: 
60 manufacturers and sellers, and 70 air transporters.
    PHMSA reviewed records of the potentially affected small 
manufacturing and sales businesses by NAICS codes--discussed in greater 
detail in the Regulatory Flexibility Analysis--and determined that of 
the 60 identified:
     29 are classified as manufacturers of primary or storage 
batteries;
     16 are classified as manufacturers of equipment, other 
devices, or components of these articles;
     13 are classified as wholesalers of equipment or parts; 
and
     2 are engaged in research and development.
    Through the preparation of this analysis, there has been no 
evidence of retailers other than the manufacturers and wholesalers 
above that specialize in lithium battery sales.
    PHMSA then identified air transportation businesses by NAICS code, 
and found that there are 642 businesses with fewer than 1,000 employees 
offering either scheduled air transportation (passenger or freight 
only) or chartered freight transportation. Of these, 572 had 100 or 
fewer employees and were judged to be unlikely to carry enough cargo 
that the impact of the revised regulation would be considered 
significant. Thus there are 70 air carriers potentially affected.
4. Description of the Projected Reporting, Record Keeping and Other 
Compliance Requirements for Small Entities
    The costs accruing to small businesses are not anticipated to be 
significant.
     Hazard communication: The adoption of the 2013-2014 ICAO 
Technical Instructions for the majority of projected shipments is 
unlikely to generate substantial new costs. The total estimated cost 
for the entire industry over the next decade is between $1.5 and $2.1 
million; the proportion applicable to small businesses is negligible.
     Training: PHMSA estimates that a company will spend 
between $300 and $400 to train an employee once, with subsequent 
trainings being required independent of this regulation. While this 
figure represents the largest individual cost under consideration in 
this analysis, the small businesses that commented on the Initial 
Regulatory Flexibility Analysis (IRFA) state that they do currently 
package fully regulated Class 9 shipments, indicating that these costs 
are at least already partly borne by such businesses.
     Records of Design Testing: The final rule requires the 
development and retention of battery-design testing results. The 
projected cost of these activities is estimated at $110,000 over the 
next 10 years; the proportion applicable to small businesses is 
negligible.
5. Steps PHMSA Has Taken To Minimize the Significant Economic Impact on 
Small Entities
    There are no alternatives to the final rule that would accomplish 
the stated objectives of the rule, which are to reduce the risk posed 
by the transport of lithium batteries and to harmonize the domestic HMR 
with international rules. As discussed in IV. B. of the preamble to 
this final rule, PHMSA considered a number of regulatory options: (1) A 
do nothing option, (2) an option that would harmonize the HMR with the 
requirements of the UN Model Regulations, the ICAO Technical 
Instructions and the IMDG Code, and (3) an option consistent with 
eliminating regulatory exceptions for the transport of small lithium 
cells and batteries. PHMSA chose the second option because it was 
constructed with the input of stakeholders representing the aviation, 
manufacturing, and shipping industries, international governments, and 
safety agencies. It is the result of compromise directed at producing a 
strong yet flexible regulation and reflects congressional intent and 
stakeholders' need for a global standard. Harmonizing the domestic HMR 
with the requirements of the UN Model Regulations, the ICAO Technical 
Instructions and the IMDG Code provides the most flexibility while 
increasing safety levels. Based on this analysis, we certify that this 
final rule does not impose a significant economic impact on a 
substantial number of small entities.

F. Paperwork Reduction Act

    PHMSA currently has approved information collections under Office 
of Management and Budget (OMB) Control Number 2137-0034, ``Hazardous 
Materials Shipping Papers and Emergency Response Information'' which is 
currently under OMB review and OMB Control Number 2137-0572, Testing 
Requirements for Non-Bulk Packaging,'' with an expiration date of July 
31, 2015. This final rule will result in an increase in the annual 
burden of these information collections due to amendments being adopted 
in this final rule. IATA states that, based on calculations for the 
completion of a shipping paper for various types of shipments of 
lithium batteries, it takes

[[Page 46031]]

between 3 minutes and 10 minutes to produce a shipping paper and 
additional time associated with collection of data to complete the 
information required on the written information to the pilot-in-command 
(NOPIC) as required by Sec.  175.33 of the HMR. IATA also states that 
PHMSA's estimate of consolidated shipments to be inaccurate. The 
commenter states that while there is some level of package 
consolidation for shipments of batteries and for equipment shipped with 
batteries from the point of manufacture to a distribution center, the 
same is not necessarily true for shipments from a distribution center.
    PHMSA has re-evaluated the additional time for a transport worker 
to review and complete an existing shipping document; PHMSA's revised 
estimate accounts for the reduced regulatory burden of this final rule 
relative to the NPRM and the revised estimate also accounts for the 
additional time required by shippers of batteries and assumes lithium 
battery shippers often repeatedly offer the same hazardous materials 
and have developed the ability to automate many administrative 
processes. PHMSA has adjusted the paperwork burden imposed by the 
requirements of this final rule accordingly.
    Under the Paperwork Reduction Act of 1995, no person is required to 
respond to a collection of information unless it is approved by OMB and 
displays a valid OMB control number. Section 1320.8(d), Title 5, Code 
of Federal Regulations requires that PHMSA provide interested members 
of the public and affected agencies an opportunity to comment on 
information collection and recordkeeping requests.
    OMB Control No. 2137-0034
Hazardous Materials Shipping Papers and Emergency Response Information
    Additional Annual Number of Respondents: 670.
    Additional Annual Number of Responses: 143,430.
    Additional Annual Burden Hours: 2,390.
    Additional Annual Burden Costs: $47,800.
    OMB Control No. 2137-0572.
Testing Requirements for Non-Bulk Packaging
    Additional Annual Number of Respondents: 110.
    Additional Annual Number of Responses: 1,100.
    Additional Annual Burden Hours: 550.
    Additional Annual Burden Costs: $11,000.
    Requests for a copy of this information collection should be 
directed to: Steven Andrews or T. Glenn Foster, Office of Hazardous 
Materials Standards (PHH-10), Pipeline and Hazardous Materials Safety 
Administration, Room E24-426, 1200 New Jersey Ave. SE., Washington, DC 
20590-0001, telephone (202) 366-8553.

G. Regulation Identifier Number (RIN)

    A regulation identifier number (RIN) is assigned to each regulatory 
action listed in the Unified Agenda of Federal Regulations. The 
Regulatory Information Service Center generally publishes the Unified 
Agenda in April and October of each year. The RIN contained in the 
heading of this document can be used to cross-reference this action 
with the Unified Agenda.

H. Unfunded Mandates Reform Act

    This final rule does not impose unfunded mandates under the 
Unfunded Mandates Reform Act of 1995. It does not result in costs of 
$140,800,000 or more, adjusted for inflation, to either State, local or 
tribal governments, in the aggregate, or to the private sector in any 
one year, and is the least burdensome alternative that achieves the 
objective of the rule.

I. Environmental Assessment and Finding of No Significant Impact

    The National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 
4321-4347) requires Federal agencies to consider the environmental 
impacts of major Federal actions and prepare a detailed statement for 
actions significantly affecting the quality of the human environment. 
For those actions that are unlikely to have significant environmental 
impacts, the Council on Environmental Quality (CEQ) regulations (40 CFR 
parts 1500-1508) require Federal agencies to conduct an environmental 
assessment that includes (1) the need for the action, (2) alternatives 
to the action, (3) probable environmental impacts of the action and 
alternatives, and (4) the agencies and persons consulted during the 
consideration process (40 CFR 1508.9).
1. Purpose and Need
    This final rule amends the requirements for the transport of 
lithium batteries. Most of these amendments harmonize the HMR with its 
international equivalents and focus on packaging, hazard communication 
and training. These measures serve to ensure that lithium batteries are 
safe for transport and the hazards associated with lithium batteries 
are properly communicated. Thus, most of the amendments of this final 
rule have no environmental impact. However, we are amending the 
requirements applicable to the transport of transport of lithium 
batteries for disposal or recycling. This section focuses on the 
environmental impacts of these activities under each of the 
alternatives considered.
    Once lithium batteries reach the end of their useful life they must 
be recycled or properly disposed. The environmental benefits and policy 
need for battery recycling have been demonstrated through the enactment 
of battery recycling laws by more than half the states and Puerto Rico. 
Several states have also enacted laws specifically mandating the 
recycling of lithium ion batteries.\8\ Appropriate transport safety 
regulations will ensure that lithium batteries can be safely and 
efficiently transported for disposal or recycling. Any provisions for 
the transport of lithium batteries must balance the need to facilitate 
transport with the need to ensure that the hazards posed by lithium 
batteries in transport are appropriately managed.
---------------------------------------------------------------------------

    \8\ Source: Call2Recycle, Inc a battery product stewardship 
program; http://www.call2recycle.org/recycling-law-map/.
---------------------------------------------------------------------------

2. Alternatives
    In developing this rule, PHMSA considered three regulatory options: 
(1) A do nothing option (no action alternative); (2) an option that 
would expand the current recycling and disposal provisions thus 
facilitating more movement; and (3) an option that eliminates 
regulatory exceptions for the transport of small lithium cells and 
batteries. This would require lithium batteries shipped for disposal or 
recycling to meet all of the requirements applicable to new batteries.
    The second option is the selected alternative. PHMSA has chosen 
this alternative because it was constructed with the input of 
stakeholders representing the, manufacturing, and shipping industries, 
environmental concerns and battery recyclers. This option requires 
lithium batteries to be packaged to reduce the possibility of damage 
that could lead to an incident; and accompanied by hazard information 
that ensures appropriate and careful handling and informs transport 
workers and emergency response personnel of actions to be taken in an 
emergency.
    The do nothing option does not achieve the stated objective of 
ensuring the safe transport of lithium batteries for disposal or 
recycling.
    The third option was judged too costly and onerous to industry 
relative

[[Page 46032]]

to potential benefits, and was thus eliminated.
3. Analysis of Environmental Impacts
    Hazardous materials are substances that may pose a threat to public 
safety or the environment during transportation because of their 
physical, chemical, or nuclear properties. The hazardous material 
regulatory system is a risk management system that is prevention-
oriented and focused on identifying a safety hazard and reducing the 
probability and quantity of a hazardous material release. The 
regulations require each shipper to classify a material in accordance 
with these hazard classes; the process of classifying a hazardous 
material is itself a form of hazard analysis. Further, the regulations 
require the shipper to communicate the material's hazards through use 
of the hazard class, and proper shipping name on the shipping paper and 
the use of labels on packages and placards on transport vehicles. Thus, 
the shipping paper, labels, and placards communicate the most 
significant findings of the shipper's hazard analysis. Hazardous 
materials are often further sub-categorized to one of three packing 
groups based upon its degree of hazard--from high-hazard Packing Group 
I to a low-hazard Packing Group III material. The quality, damage 
resistance, and performance standards of the packaging in each packing 
group are appropriate for the hazards of the material transported.
    Releases of hazardous materials, whether caused by accident or 
deliberate sabotage, can result in explosions or fires. Radioactive, 
toxic, infectious, or corrosive hazardous materials can have short-term 
or long-term exposure effects on humans or the environment. Generally, 
however, the hazard class definitions are focused on the potential 
safety hazards associated with a given material, or type of material, 
rather than the environmental hazards of such materials.
    Lithium is the lightest solid metal. It can be absorbed into the 
body by inhalation of its aerosol and by ingestion and is corrosive to 
the eyes, the skin, and the respiratory tract. Lithium reacts violently 
with strong oxidants, acids, and many compounds (hydrocarbons, 
halogens, halons, concrete, sand and asbestos) causing a fire and 
explosion hazard. In addition, lithium reacts with water, forming 
highly flammable hydrogen gas and corrosive fumes of lithium hydroxide. 
Lithium hydroxide represents a potentially significant environmental 
hazard, particularly to water organisms. Lithium metal batteries 
contain no toxic metals.
    Lithium ion batteries contain an ionic form of lithium but no 
lithium metal. Lithium ion batteries do not pose an environmental 
hazard and are safe for disposal in the normal municipal waste stream. 
While other types of batteries include toxic metals such as cadmium, 
the metals in lithium ion batteries--cobalt, copper, nickel and iron 
are considered safe for landfills or incinerators. The primary hazard 
posed by lithium batteries are their ability to overheat and ignite, 
and once ignited, the resulting fires can be especially difficult to 
extinguish. The likelihood to overheat or ignite is increased if the 
batteries are poorly packaged, damaged or exposed to a fire or a heat 
source. When packaged and handled properly, lithium batteries pose no 
environmental hazard.
    While the HMR contain provisions applicable to the transport of 
lithium batteries for disposal or recycling several commenters 
expressed concern about a do nothing option. GRC stated that the 
current provisions do not exclude the responsibility for hazardous 
materials training for their suppliers and that training in accordance 
with part 172, subpart H would be virtually impossible, given the 
nature of their participating organizations and the number of 
collection sites that include non-profits, schools, retailers, 
community groups, and businesses. CEA contended that a do nothing 
option will ultimately act as a disincentive for consumers to recycle 
responsibly. PHMSA agrees with CEA's comment that the do nothing 
alternative would reduce battery recycling compared with the preferred 
alternative.
    We also considered an option that would impose additional safety 
requirements on the transport of lithium batteries for disposal or 
recycling, including a requirement that such batteries be placed in 
specification packages. We considered this option because lithium 
batteries of all sizes can be transported for disposal or recycling and 
the batteries are often from an uncertain origin, may be damaged and 
there is no guarantee that the batteries have a low energy level. 
Enhanced safety requirements may be appropriate in some cases. This 
option was ultimately rejected because this would not facilitate 
battery recycling and would generate only marginal additional safety 
benefits and potentially result in additional environmental impacts 
from the use of additional packaging.
    RBRC stated that, for this rule to be successful there must be a 
specific provision dealing with collection for recycling programs that 
recognizes the simple fact that most used batteries collected are, by 
their very nature, in a low state of charge. With this in mind, we 
developed measures to expand the current lithium battery recycling 
provisions with the aim to facilitate the transport of most lithium 
batteries i.e. those used in consumer electronic devices consistent 
with current exceptions for the transport of small lithium cells and 
batteries. PHMSA ultimately selected this option because it was 
determined to pose little adverse impact to the environment, encourages 
responsible end of life practices for lithium batteries and provides a 
means to safely transport lithium batteries for their final 
disposition. The measures in this option reduce the risks to people and 
the environment posed during transportation of lithium metal and 
lithium ion batteries by ensuring that the batteries: Withstand 
conditions normally encountered in transportation, are packaged to 
reduce the possibility of damage that could lead to an incident, and 
minimize the consequences of an incident. Additionally, the provisions 
of this option facilitate the collection and safe transport of used 
lithium cells and batteries for recycling or disposal.
4. Consultation and Public Comment
    PHSMA received numerous comments to the NPRM (75 FR 1302, Jan. 11, 
2010) and the April 11, 2012 (77 FR 21714) Federal Register notice that 
sought further comments on the impacts of revisions to the HMR 
applicable to lithium batteries. The commenters who responded to the 
draft environmental impact statement included Black and Decker, the 
Environmental Technology Council, UTC, CERC, ITI, PRBA, the Lithium 
Battery Industry Coalition, GRC, and CEA. These commenters supported 
provisions for the transport of lithium batteries for recycling. They 
stressed the need to maintain exceptions for the transport of small 
(consumer type) lithium batteries. ITI stated that the initial 
environmental impact statement published in the NPRM lacks an analysis 
of the impact that classifying consumer electronic equipment as a Class 
9 hazardous material would have on waste streams. The commenter stated 
that such classification would result in significant escalation in the 
cost of shipping devices containing lithium batteries for proper 
disposal or recycling. The provisions of this final rule maintain the 
current exceptions for the transport lithium batteries contained in 
equipment; thus this final rule will not impact consumer electronic 
equipment. The Environmental

[[Page 46033]]

Technology Council agreed that, while the performance standard may be 
sufficient for lithium ion batteries, such as those found in cellular 
phones and notebook computers, this standard may not be appropriate for 
reactive batteries that pose the greatest risk. The commenter 
recommended specific measures that should be taken to ensure the safe 
transport of reactive batteries, including ensuring that batteries are 
not connected in series, insulating all batteries from each other, and 
limiting the types and sizes of packagings. The HMR require that 
lithium batteries be protected from short circuits and damage, as well 
as separated from each other and other conductive materials. We 
encourage all shippers and carriers to implement appropriate risk 
reduction measures commensurate with the hazard posed by an individual 
shipment. These measures outlined in the HMR are intended to provide 
flexible, performance-oriented provisions.
5. Finding of No Significant Impact
    PHMSA finds that the selected alternative will not have a 
significant impact on the human environment. Lithium batteries are a 
key part of strategies to develop greener technologies to power many 
different applications from automobiles to cellular phones to 
computers. The measures outlined in this final rule facilitate the safe 
and efficient transportation of lithium metal and lithium ion batteries 
across national boundaries from initial manufacture until their 
eventual disposal or recycling. This regulation is anticipated to 
result in slight positive impacts on the environment because the 
regulation provides clear and consistent regulations that reduce the 
likelihood of a transportation incident involving lithium batteries 
which would likely cause other secondary environmental impacts. The 
provisions of this final rule also continue to permit the operation of 
battery recycling programs throughout the United States.

J. Privacy Act

    In accordance with 5 U.S.C. 553(c), DOT solicits comments from the 
public to better inform its rulemaking process. DOT posts these 
comments, without edit, to www.regulations.gov, as described in the 
system of records notice (DOT/ALL-14 FDMS), which can be reviewed at 
www.dot.gov/privacy. DOT will read and respond to all substantive 
comments on a rulemaking. If you are filing comments on behalf of an 
organization or group of individuals, we encourage you to include the 
name of your group or organization. However, all comments, even 
anonymous comments filed on behalf of a group, will be considered if 
they are timely filed. Including your name/group along with your 
comment is completely optional.

K. Executive Order 13609 and International Trade Analysis

    Under E.O. 13609, agencies must consider whether the impacts 
associated with significant variations between domestic and 
international regulatory approaches are unnecessary or may impair the 
ability of American business to export and compete internationally. In 
meeting shared challenges involving health, safety, labor, security, 
environmental, and other issues, international regulatory cooperation 
can identify approaches that are at least as protective as those that 
are, or would be, adopted in the absence of such cooperation. 
International regulatory cooperation can also reduce, eliminate, or 
prevent unnecessary differences in regulatory requirements.
    Similarly, the Trade Agreements Act of 1979 (Pub. L. 96-39), as 
amended by the Uruguay Round Agreements Act (Pub. L. 103-465), 
prohibits Federal agencies from establishing any standards or engaging 
in related activities that create unnecessary obstacles to the foreign 
commerce of the United States. For purposes of these requirements, 
Federal agencies may participate in the establishment of international 
standards, so long as the standards have a legitimate domestic 
objective, such as providing for safety, and do not operate to exclude 
imports that meet this objective. The statute also requires 
consideration of international standards and, where appropriate, that 
they be the basis for U.S. standards.
    The Republic of Korea Ministry of Foreign Affairs and Trade, PRBA, 
NEMA, NAM, Digital Europe, Japan, and the European Union stated that 
the January 2010 NPRM is inconsistent with the ICAO Technical 
Instructions. The commenters stated that the proposed elimination of 
the exceptions for certain lithium batteries when transported by 
aircraft, and the proposed revision of the design change criteria, 
would result in an unnecessary increase in transportation, packing, and 
testing costs for the manufacturers and traders of lithium batteries. 
These commenters further stated that technical rules and regulations 
should not be more trade-restrictive than necessary, as stipulated in 
the relevant World Trade Organization Agreements addressing Technical 
Barriers to Trade.
    PHMSA participates in the establishment of international standards 
in order to protect the safety of the American public, and we have 
assessed the effects of this final rule to ensure that it does not 
cause unnecessary obstacles to foreign trade. This final rule 
harmonizes the domestic HMR with approaches outlined in the UN Model 
Regulations, the ICAO Technical Instructions and the IMDG Code. 
Commenters identified several benefits to adopting the international 
transport standards for lithium batteries into the domestic 
regulations, including streamlined shipping practices that reduce cost, 
a reduction in the potential for confusion and improved shipment safety 
through increased visibility of lithium battery shipments. Conversely, 
commenters noted several disadvantages to not adopting the 
international transport standards into the domestic regulations. The 
current ICAO Technical Instructions are at least as safety as the 
current HMR and many commenters stated that the current domestic 
regulations do not provide the level of safety as the ICAO Technical 
Instructions. Further, maintaining a dual system hinders consistent 
enforcement of the requirements and increases the likelihood of 
frustrated shipments.
    The decision to adopt the requirements of the ICAO Technical 
Instructions into the domestic HMR was guided by the input of 
stakeholders representing the aviation, manufacturing, and shipping 
industries, as well as international governments and safety agencies. 
It is the result of considerations directed at producing a strong yet 
flexible regulation and reflects Congressional intent and stakeholders' 
need for a global standard. Accordingly, this rulemaking is consistent 
with E.O. 13609 and PHMSA's obligations under the Trade Agreement Act, 
as amended.

List of Subjects

49 CFR Part 171

    Exports, Hazardous materials transportation, Hazardous waste, 
Imports, Incorporation by reference, Reporting and recordkeeping 
requirements.

49 CFR Part 172

    Education, Hazardous materials transportation, Hazardous waste, 
Incorporation by reference, Labeling, Markings, Packaging and 
containers, Reporting and recordkeeping requirements.

[[Page 46034]]

49 CFR Part 173

    Hazardous materials transportation, Incorporation by reference, 
Packaging and containers, Radioactive materials, Reporting and 
recordkeeping requirements, Uranium.

49 CFR Part 175

    Air carriers, Hazardous materials transportation, Radioactive 
materials, Reporting and recordkeeping requirements.

    In consideration of the foregoing, we amend 49 CFR Chapter I as 
follows:

PART 171--GENERAL INFORMATION, REGULATIONS, AND DEFINITIONS

0
1. The authority citation for part 171 continues to read as follows:

    Authority:  49 U.S.C. 5101-5128, 44701; 49 CFR 1.81, 1.97; Pub. 
L. 101-410 section 4 (28 U.S.C. 2641 note); Pub. L. 104-134, section 
31001.


0
2. In Sec.  171.8:
0
a. The definitions for ``Aggregate lithium content'' and ``Equivalent 
lithium content'' and ``Lithium content'' are removed.
0
b. The definitions for ``Lithium ion cell or battery'' ``Lithium metal 
cell or battery'', ``Short circuit'' and ``Watt-hour'' are added in 
alphabetical order.
    The additions read as follows:


Sec.  171.8  Definitions and abbreviations.

* * * * *
    Lithium ion cell or battery means a rechargeable electrochemical 
cell or battery in which the positive and negative electrodes are both 
lithium compounds constructed with no metallic lithium in either 
electrode. A lithium ion polymer cell or battery that uses lithium ion 
chemistries, as described herein, is regulated as a lithium ion cell or 
battery.
    Lithium metal cell or battery means an electrochemical cell or 
battery utilizing lithium metal or lithium alloys as the anode. The 
lithium content of a lithium metal or lithium alloy cell or battery is 
measured when the cell or battery is in an undischarged state. The 
lithium content of a lithium metal or lithium alloy battery is the sum 
of the grams of lithium content contained in the component cells of the 
battery.
* * * * *
    Short circuit means a direct connection between positive and 
negative terminals of a cell or battery that provides an abnormally low 
resistance path for current flow.
* * * * *
    Watt-hour (Wh) means a unit of energy equivalent to one watt (1 W) 
of work acting for one hour (1 h) of time. The Watt-hour rating of a 
lithium ion cell or battery is determined by multiplying the rated 
capacity of a cell or battery in ampere-hours, by its nominal voltage. 
Therefore, Watt-hour (Wh) = ampere-hour (Ah) x volts (V).
* * * * *

0
3. In Sec.  171.12, paragraph (a)(6) is revised to read as follows:


Sec.  171.12  North American shipments.

    (a) * * *
    (6) Lithium metal cells and batteries. Lithium metal cells and 
batteries (UN3090) are forbidden for transport aboard passenger-
carrying aircraft. The outside of each package that contains lithium 
cells or batteries meeting the conditions for exception in Sec.  
173.185(c) of this subchapter and transported in accordance with the 
Transport Canada TDG Regulations must be marked in accordance with 
Sec.  173.185(c)(1)(iii) or (c)(1)(iv) as appropriate.
* * * * *

0
4. In Sec.  171.24, paragraphs (d)(1)(ii) and (d)(1)(iii) are revised 
to read as follows:


Sec.  171.24  Additional requirements for the use of the ICAO Technical 
Instructions.

* * * * *
    (d) * * *
    (1) * * *
    (ii) Lithium metal cells and batteries. Lithium metal cells and 
batteries (UN3090) are forbidden for transport aboard passenger-
carrying aircraft. The outside of each package that contains lithium 
metal cells or lithium metal batteries (UN3090) transported in 
accordance with Packing Instruction 968, Section II of the ICAO 
Technical Instructions must be marked ``PRIMARY LITHIUM BATTERIES--
FORBIDDEN FOR TRANSPORT ABOARD PASSENGER AIRCRAFT'' or ``LITHIUM METAL 
BATTERIES--FORBIDDEN FOR TRANSPORT ABOARD PASSENGER AIRCRAFT.''
    (iii) Low production runs or prototypes lithium cells or batteries. 
Production runs consisting of not more than 100 lithium cells or 
batteries per year, or prototype lithium cells or batteries (including 
cells or batteries packed with, or contained in, equipment or motor 
vehicles) not of a type proven to meet the requirements of section 38.3 
of the UN Manual of Tests and Criteria (IBR, see Sec.  171.7 of this 
subchapter), must be approved by the Associate Administrator prior to 
transportation aboard aircraft.
* * * * *

0
5. In Sec.  171.25, paragraph (b)(3) is revised to read as follows:


Sec.  171.25  Additional requirements for the use of the IMDG Code.

* * * * *
    (b) * * *
    (3) The outside of each package containing lithium metal cells or 
batteries (UN3090) transported in accordance with special provision 188 
of the IMDG Code must be marked ``PRIMARY LITHIUM BATTERIES--FORBIDDEN 
FOR TRANSPORT ABOARD PASSENGER AIRCRAFT'' or ``LITHIUM METAL 
BATTERIES--FORBIDDEN FOR TRANSPORT ABOARD PASSENGER AIRCRAFT.'' This 
marking is not required on packages that contain 5 kg (11 pounds) net 
weight or less of lithium metal cells or batteries that are packed 
with, or contained in, equipment.
* * * * *

PART 172--HAZARDOUS MATERIALS TABLE, SPECIAL PROVISIONS, HAZARDOUS 
MATERIALS COMMUNICATIONS, EMERGENCY RESPONSE INFORMATION, TRAINING 
REQUIREMENTS, AND SECURITY PLANS

0
6. The authority citation for part 172 continues to read as follows:

    Authority:  49 U.S.C. 5101-5128, 44701; 49 CFR 1.81, 1.97.


0
7. In Sec.  172.101, the Hazardous Materials Table is amended by 
removing and adding entries in alphabetical order, to read as follows:


Sec.  172.101  Purpose and use of hazardous materials table.

* * * * *

[[Page 46035]]



------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                       (8)  Paging  (Sec.   173.***)       (9) Quantity limitations       (10) Vessel stowage
                 Hazardous                                                                        ---------------------------------------  (see Sec.  Sec.   173.27  ---------------------------
                 materials       Hazard                                                                                                           and 175.75)
  Symbols    descriptions and   class or    Identification      PG         Label       Special                                           ----------------------------
              proper shipping   division         Nos.                      codes      provisions   Exceptions   Non-bulk        Bulk        Passenger                  Loca- tion       Other
                   names                                                                                                                    aircraft/    Cargo air-
                                                                                                                                              rail       craft only
(1)          (2).............         (3)  (4)............         (5)         (6)  (7)..........        (8A)        (8B)  (8C).........  (9A)........  (9B)........  (10A).......  (10B)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
             [REMOVE]
 
                                                                                          * * * * * * *
             Lithium                    9  UN3091.........          II           9  29, 188, 189,         185         185  None.........  See A101,...  35 kg.......  A
              batteries,                                                             190, A54,                                            A104........
              contained in                                                           A55, A101,
              equipment.                                                             A104.
             Lithium                    9  UN3091.........          II           9  29, 188, 189,         185         185  None.........  See A101,     35 kg gross.  A
              batteries                                                              190, A54,                                             A103.
              packed with                                                            A55, A101,
              equipment.                                                             A103.
             Lithium battery.           9  UN3090.........          II           9  29, 188,              185         185  None.........  See A100....  35 kg gross.  A
                                                                                     189,190,
                                                                                     A51, A54,
                                                                                     A55, A100.
 
                                                                                          * * * * * * *
             [ADD]
 
                                                                                          * * * * * * *
             Lithium ion                9  UN3480.........          II           9  A51, A54.....         185         185  185..........  5 kg........  35 kg.......  A
              batteries
              including
              lithium ion
              polymer
              batteries.
             Lithium ion                9  UN3481.........          II           9  A54..........         185         185  185..........  5 kg........  35 kg.......  A
              batteries
              contained in
              equipment
              including
              lithium ion
              polymer
              batteries.
             Lithium ion                9  UN3481.........          II           9  A54..........         185         185  185..........  5 kg........  35 kg.......  A
              batteries
              packed with
              equipment
              including
              lithium ion
              polymer
              batteries.
             Lithium metal              9  UN3090.........          II           9  A54..........         185         185  185..........  Forbidden...  35 kg.......  A
              batteries
              including
              lithium alloy
              batteries.
             Lithium metal              9  UN3091.........          II           9  A54, A101....         185         185  185..........  5 kg........  35 kg.......  A
              batteries
              contained in
              equipment
              including
              lithium alloy
              batteries.
             Lithium metal              9  UN3091.........          II           9  A54..........         185         185  185..........  5 kg........  35 kg.......  A
              batteries
              packed with
              equipment
              including
              lithium alloy
              batteries.
 
                                                                                          * * * * * * *
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 46036]]


0
8. In Sec.  172.102 amend paragraphs (c)(1) and (c)(2) as follows:
0
a. In paragraph (c)(1), special provisions 134 and 328 are revised and 
special provisions 29, 188, 189, and 190 are removed;
0
b. In paragraph (c)(2), special provisions A51, A54 and A101 are 
revised; and special provisions A55, A100, A103, and A104 are removed.
    The revisions read as follows:


Sec.  172.102  Special provisions.

* * * * *
    (c) * * *
    (1) * * *
    134 This entry only applies to vehicles powered by wet batteries, 
sodium batteries, lithium metal batteries or lithium ion batteries and 
equipment powered by wet batteries or sodium batteries that are 
transported with these batteries installed. For the purpose of this 
special provision, vehicles are self-propelled apparatus designed to 
carry one or more persons or goods. Examples of such vehicles are 
electrically-powered cars, motorcycles, scooters, three- and four-
wheeled vehicles or motorcycles, battery-assisted bicycles, lawn 
tractors, boats, aircraft, wheelchairs and other mobility aids. 
Examples of equipment are lawnmowers, cleaning machines or model boats 
and model aircraft. Equipment powered by lithium metal batteries or 
lithium ion batteries must be consigned under the entries ``Lithium 
metal batteries contained in equipment'' or ``Lithium metal batteries 
packed with equipment'' or ``Lithium ion batteries contained in 
equipment'' or ``Lithium ion batteries packed with equipment'' as 
appropriate. Self-propelled vehicles or equipment that also contain an 
internal combustion engine must be consigned under the entries 
``Engine, internal combustion, flammable gas powered'' or ``Engine, 
internal combustion, flammable liquid powered'' or ``Vehicle, flammable 
gas powered'' or ``Vehicle, flammable liquid powered,'' as appropriate. 
These entries include hybrid electric vehicles powered by both an 
internal combustion engine and batteries. Additionally, self-propelled 
vehicles or equipment that contain a fuel cell engine must be consigned 
under the entries ``Engine, fuel cell, flammable gas powered'' or 
``Engine, fuel cell, flammable liquid powered'' or ``Vehicle, fuel 
cell, flammable gas powered'' or ``Vehicle, fuel cell, flammable liquid 
powered,'' as appropriate. These entries include hybrid electric 
vehicles powered by a fuel cell engine, an internal combustion engine, 
and batteries.
* * * * *
    328 When lithium metal or lithium ion batteries are contained in 
the fuel cell system, the item must be described under this entry and 
the appropriate entries for ``Lithium metal batteries contained in 
equipment'' or ``Lithium ion batteries contained in equipment''.
    (c) * * *
    (2) * * *
Code/Special Provisions
* * * * *
    A51 Irrespective of the quantity limitations specified in Column 
(9A) of the Sec.  172.101 Table or Sec.  175.75(c), the following 
aircraft batteries may be transported on passenger aircraft as cargo:
    a. Wet cell batteries, UN 2794 or UN 2795, up to a limit of 100kg 
net mass per package;
    b. Lithium ion batteries, UN 3480, packages containing a single 
aircraft battery with a net mass not exceeding 35kg; and
    c. Transport in accordance with this special provision must be 
noted on the shipping paper.
* * * * *
    A54 Irrespective of the quantity limits in Column 9B of the Sec.  
172.101 table, a lithium battery, including a lithium battery packed 
with, or contained in, equipment that otherwise meets the applicable 
requirements of Sec.  173.185, may have a mass exceeding 35 kg if 
approved by the Associate Administrator prior to shipment.
* * * * *
    A101 In addition to the applicable requirements of Sec.  173.185, 
the quantity of lithium metal in the batteries contained in any piece 
of equipment must not exceed 12 g per cell and 500 g per battery.
* * * * *

PART 173--SHIPPERS--GENERAL REQUIREMENTS FOR SHIPMENTS AND 
PACKAGINGS

0
9. The authority citation for part 173 continues to read as follows:

    Authority:  49 U.S.C. 5101-5128, 44701; 49 CFR 1.81, 1.97.


0
10. Section 173.185 is revised to read as follows:


Sec.  173.185  Lithium cells and batteries.

    As used in this section, lithium cell(s) or battery(ies) includes 
both lithium metal and lithium ion chemistries. Equipment means the 
device or apparatus for which the lithium cells or batteries will 
provide electrical power for its operation.
    (a) Classification. (1) Each lithium cell or battery must be of the 
type proven to meet the criteria in Part III, sub-section 38.3 of the 
UN Manual of Tests and Criteria (IBR; see Sec.  171.7 of this 
subchapter). Lithium cells and batteries are subject to these tests 
regardless of whether the cells used to construct the battery are of a 
tested type.
    (i) Cells and batteries manufactured according to a type meeting 
the requirements of sub-section 38.3 of the UN Manual of Tests and 
Criteria, Revision 3, Amendment 1 or any subsequent revision and 
amendment applicable at the date of the type testing may continue to be 
transported, unless otherwise provided in this subchapter.
    (ii) Cell and battery types only meeting the requirements of the UN 
Manual of Tests and Criteria, Revision 3, are no longer valid. However, 
cells and batteries manufactured in conformity with such types before 
July 2003 may continue to be transported if all other applicable 
requirements are fulfilled.
    (2) Each person who manufactures lithium cells or batteries must 
create a record of satisfactory completion of the testing required by 
this paragraph prior to offering the lithium cell or battery for 
transport and must:
    (i) Maintain this record for as long as that design is offered for 
transportation and for one year thereafter; and
    (ii) Make this record available to an authorized representative of 
the Federal, state or local government upon request.
    (3) Except for cells or batteries meeting the requirements of 
paragraph (c) of this section, each lithium cell or battery must:
    (i) Incorporate a safety venting device or be designed to preclude 
a violent rupture under conditions normally incident to transport;
    (ii) Be equipped with effective means of preventing external short 
circuits; and
    (iii) Be equipped with an effective means of preventing dangerous 
reverse current flow (e.g., diodes or fuses) if a battery contains 
cells, or a series of cells that are connected in parallel.
    (b) Packaging. (1) Each package offered for transportation 
containing lithium cells or batteries, including lithium cells or 
batteries packed with, or contained in, equipment, must meet all 
applicable requirements of subpart B of this part.
    (2) Lithium cells or batteries, including lithium cells or 
batteries packed with, or contained in, equipment, must be packaged in 
a manner to prevent:
    (i) Short circuits;
    (ii) Movement within the outer package; and

[[Page 46037]]

    (iii) Accidental activation of the equipment.
    (3) For packages containing lithium cells or batteries offered for 
transportation:
    (i) The lithium cells or batteries must be placed in non-metallic 
inner packagings that completely enclose the cells or batteries, and 
separate the cells or batteries from contact with equipment, other 
devices, or conductive materials (e.g., metal) in the packaging.
    (ii) The inner packagings containing lithium cells or batteries 
must be placed in one of the following packagings meeting the 
requirements of part 178, subparts L and M, of this subchapter at the 
Packing Group II level:
    (A) Metal (4A, 4B, 4N), wooden (4C1, 4C2, 4D, 4F), fiberboard (4G), 
or solid plastic (4H1, 4H2) box;
    (B) Metal (1A2, 1B2, 1N2), plywood (1D), fiber (1G), or plastic 
(1H2) drum;
    (C) Metal (3A2, 3B2) or plastic (3H2) jerrican.
    (iii) When packed with equipment lithium cells or batteries must:
    (A) Be placed in inner packagings that completely enclose the cell 
or battery, then placed in an outer packaging. The completed package 
for the cells or batteries must meet the Packing Group II performance 
requirements as specified in paragraph (b)(3)(ii) of this section; or
    (B) Be placed in inner packagings that completely enclose the cell 
or battery, then placed with equipment in a package that meets the 
Packing Group II performance requirements as specified in paragraph 
(b)(3)(ii) of this section.
    (4) When lithium cells or batteries are contained in equipment:
    (i) The outer packaging must be constructed of suitable material of 
adequate strength and design in relation to the capacity and intended 
use of the packaging, unless the lithium cells or batteries are 
afforded equivalent protection by the equipment in which they are 
contained;
    (ii) Equipment must be secured against movement within the outer 
packaging and be packed so as to prevent accidental operation during 
transport; and
    (iii) Any spare lithium ion cells or batteries packed with the 
equipment must be packaged in accordance with paragraph (b)(3) of this 
section.
    (5) Lithium batteries that weigh 12 kg (26.5 pounds) or more and 
have a strong, impact-resistant outer casing and assemblies of such 
batteries, may be packed in strong outer packagings; in protective 
enclosures (for example, in fully enclosed or wooden slatted crates); 
or on pallets or other handling devices, instead of packages meeting 
the UN performance packaging requirements in paragraphs (b)(3)(ii) and 
(b)(4) of this section. Batteries or battery assemblies must be secured 
to prevent inadvertent movement, and the terminals may not support the 
weight of other superimposed elements. Batteries or battery assemblies 
packaged in accordance with this paragraph are not permitted for 
transportation by passenger-carrying aircraft, and may be transported 
by cargo aircraft only if approved by the Associate Administrator.
    (c) Exceptions for smaller cells or batteries. A package containing 
lithium cells or batteries, or lithium cells or batteries packed with, 
or contained in, equipment, that meets the conditions of this 
paragraph, is excepted from the requirements in subparts C through H of 
part 172 of this subchapter and the UN performance packaging 
requirements in paragraphs (b)(3)(ii) and (b)(4) of this section under 
the following conditions and limitations.
    (1) Size limits:
    (i) The Watt-hour rating may not exceed 20 Wh for a lithium ion 
cell or 100 Wh for a lithium ion battery. After December 31, 2015, each 
lithium ion battery subject to this provision must be marked with the 
Watt-hour rating on the outside case.
    (ii) The lithium content may not exceed 1 g for a lithium metal 
cell or 2 g for a lithium metal battery.
    (iii) Except when lithium metal cells or batteries are packed with 
or contained in equipment in quantities less than 5 kg net weight, the 
outer package that contains lithium metal cells or batteries must be 
marked: ``PRIMARY LITHIUM BATTERIES--FORBIDDEN FOR TRANSPORT ABOARD 
PASSENGER AIRCRAFT'' or ``LITHIUM METAL BATTERIES--FORBIDDEN FOR 
TRANSPORT ABOARD PASSENGER AIRCRAFT.''
    (iv) For transportation by highway or rail only, the lithium 
content of the cell and battery may be increased to 5 g for a lithium 
metal cell and 25 g for a lithium metal battery and 60 Wh for a lithium 
ion cell or 300 Wh for a lithium ion battery provided the outer package 
is marked: ``LITHIUM BATTERIES--FORBIDDEN FOR TRANSPORT ABOARD AIRCRAFT 
AND VESSEL.''
    (v) The marking specified in paragraphs (c)(1)(ii) and (c)(1)(iii) 
of this section must have a background of contrasting color, and the 
letters in the marking must be:
    (A) At least 6 mm (0.25 inch) on packages having a gross weight of 
30 kg (66 pounds) or less, except that smaller font may be used as 
necessary when package dimensions so require.
    (B) At least 12 mm (0.5 inch) in height on packages having a gross 
weight of more than 30 kg (66 pounds).
    (vi) Except when lithium cells or batteries are packed with, or 
contained in, equipment, each package must not exceed 30 kg (66 pounds) 
gross weight.
    (2) Packaging. Except when lithium cells or batteries are contained 
in equipment, each package must be capable of withstanding a 1.2 meter 
drop test, in any orientation, without damage to the cells or batteries 
contained in the package, without shifting of the contents that would 
allow battery-to-battery (or cell-to-cell) contact, and without release 
of the contents of the package.
    (3) Hazard communication. Except for a package containing button 
cell batteries installed in equipment (including circuit boards), or no 
more than four lithium cells or two lithium batteries installed in the 
equipment:
    (i) The outer package must be marked with:
    (A) An indication that the package contains ``lithium metal'' or 
``lithium ion'' cells or batteries, as appropriate;
    (B) An indication that the package is to be handled with care and 
that a flammable hazard exits if the package is damaged;
    (C) An indication that special procedures must be followed in the 
event the package is damaged, to include inspection and repacking if 
necessary;
    (D) A telephone number for additional information.
    (ii) Each shipment of one or more packages marked in accordance 
with this paragraph must be accompanied by a document that includes the 
following:
    (A) An indication that the package contains ``lithium metal'' or 
``lithium ion'' cells or batteries, as appropriate;
    (B) An indication that the package is to be handled with care and 
that a flammable hazard exits if the package is damaged;
    (C) An indication that special procedures must be followed in the 
event the package is damaged, to include inspection and repacking if 
necessary; and
    (D) A telephone number for additional information.
    (4) Air transportation. For transportation by aircraft, lithium 
cells and batteries may not exceed the limits in the following table. 
The limits on the maximum number of batteries and maximum net quantity 
of batteries in the following table may not be combined in the same 
package:

[[Page 46038]]



--------------------------------------------------------------------------------------------------------------------------------------------------------
                                     Lithium metal       Lithium metal       Lithium metal                                                Lithium ion
                                     cells and/or        cells with a      batteries with a    Lithium ion cells   Lithium ion cells   batteries with a
                                   batteries with a     lithium content     lithium content    and/or batteries    with a Watt-hour    Watt-hour rating
            Contents                lithium content     more than 0.3 g     more than 0.3 g    with a Watt-hour    rating more than    more than 2.7 Wh
                                   not more than 0.3   but not more than   but not more than    rating not more     2.7 Wh but not     but not more than
                                           g                  1 g                 2 g             than 2.7 Wh       more than 20 Wh         100 Wh
--------------------------------------------------------------------------------------------------------------------------------------------------------
Maximum number of cells/          No Limit..........  8 cells...........  2 batteries.......  No Limit..........  8 cells...........  2 batteries.
 batteries per package.
Maximum net quantity (mass) per   2.5 kg............  n/a...............  n/a...............  2.5 kg............  n/a...............  n/a.
 package.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (i) The outer package must be durably and legibly marked with the 
following handling marking, which is durable, legible and displayed on 
a background of contrasting color:
[GRAPHIC] [TIFF OMITTED] TR06AU14.000

    (A) The marking must be not less than 120 mm (4.7 inches) wide by 
110 mm (4.3 inches) high except markings of 105 mm (4.1 inches) wide by 
74 mm (2.9 inches) high may be used on a package containing lithium 
batteries when the package is too small for the larger marking;
    (B) The symbols and letters must be black and the border must be 
red;
    (C) The ``*'' must be replaced by ``lithium ion battery'' and/or 
``Lithium metal battery'' as appropriate and the ``xxx-xxx-xxxx'' must 
be replaced by a telephone number for additional information; and
    (D) When packages required to bear the handling marking are placed 
in an overpack, the handling marking must either be clearly visible 
through the overpack, or the handling marking must also be affixed on 
the outside of the overpack, and the overpack must be marked with the 
word ``Overpack''.
    (ii) Each shipment with packages required to bear the handling 
marking must include an indication the shipment contains ``lithium ion 
batteries'' or ``lithium metal batteries,'' as appropriate, and when an 
air waybill is used, an indication on the air waybill of compliance 
with this paragraph (c)(4) (or the applicable ICAO Packing 
Instruction).
    (iii) For lithium batteries packed with, or contained in, 
equipment, the number of batteries in each package is limited to the 
minimum number required to power the piece of equipment, plus two 
spares, and the total net quantity (mass) of the lithium cells or 
batteries in the completed package must not exceed 5 kg.
    (iv) Each person who prepares a package for transport containing 
lithium cells or batteries, including cells or batteries packed with, 
or contained in, equipment in accordance with the conditions and 
limitations in this paragraph, must receive adequate instruction on 
these conditions and limitations, commensurate with their 
responsibilities.
    (v) A package that exceeds the number or quantity (mass) limits in 
the table shown in this paragraph (c)(4) is subject to all applicable 
requirements of this subchapter, except that a package containing no 
more than 2.5 kg lithium metal cells or 10 kg lithium ion cells or 
batteries is not subject to:
    (A) The UN performance packaging requirements in paragraphs 
(b)(3)(ii) of this section when the package displays both the lithium 
battery handling marking and the Class 9 label; and
    (B) The shipping paper requirements of subpart C of part 172 when 
the offeror provides the air carrier alternative written documentation 
containing the name and address of the offeror and consignee, the UN 
number, an indication of compliance with this paragraph (c)(4) applies 
(or the applicable ICAO Packing Instruction), and the number of 
packages and the gross mass of each package and notification is given 
to the pilot-in-command in accordance with Sec.  175.33 of this 
subchapter.
    (d) Lithium cells or batteries shipped for disposal or recycling. A 
lithium cell or battery, including a lithium cell or battery contained 
in equipment, that is transported by motor vehicle to a permitted 
storage facility or disposal site, or for purposes of recycling, is

[[Page 46039]]

excepted from the testing and record keeping requirements of paragraph 
(a) and the specification packaging requirements of paragraph (b)(3) of 
this section, when packed in a strong outer packaging conforming to the 
requirements of Sec. Sec.  173.24 and 173.24a. A lithium cell or 
battery that meets the size, packaging, and hazard communication 
conditions in paragraph (c)(1)-(3) of this section is excepted from 
subparts C through H of part 172 of this subchapter.
    (e) Low production runs and prototypes. Low production runs (i.e., 
annual production runs consisting of not more than 100 lithium cells or 
batteries), or prototype lithium cells or batteries transported for 
purposes of testing, are excepted from the testing and record keeping 
requirements of paragraph (a) of this section provided:
    (1) Except as provided in paragraph (e)(3) of this section, each 
cell or battery is individually packed in a non-metallic inner 
packaging, inside an outer packaging, and is surrounded by cushioning 
material that is non-combustible and non-conductive;
    (2) The inner packages containing lithium cells or batteries are 
packed in one of the following packagings that meet the requirements of 
part 178, Subparts L and M at Packing Group I level.
    (i) Metal (4A, 4B, 4N), wooden (4C1, 4C2, 4D, 4F), or solid plastic 
(4H2) box;
    (ii) Metal (1A2, 1B2, 1N2), plywood (1D), or plastic (1H2) drum.
    (3) Lithium batteries that weigh 12 kg (26.5 pounds) or more and 
have a strong, impact-resistant outer casing or assemblies of such 
batteries, may be packed in strong outer packagings, in protective 
enclosures (for example, in fully enclosed or wooden slatted crates), 
or on pallets or other handling devices, instead of packages meeting 
the UN performance packaging requirements in paragraphs (b)(3)(ii) and 
(b)(4) of this section. The battery or battery assembly must be secured 
to prevent inadvertent movement, and the terminals may not support the 
weight of other superimposed elements;
    (4) Irrespective of the limit specified in column (9B) of the Sec.  
172.101 Hazardous Materials Table, the battery or battery assembly 
prepared for transport in accordance with this paragraph may have a 
mass exceeding 35 kg gross weight when transported by cargo aircraft; 
and
    (5) Batteries or battery assemblies packaged in accordance with 
this paragraph are not permitted for transportation by passenger-
carrying aircraft, and may be transported by cargo aircraft only if 
approved by the Associate Administrator prior to transportation.
    (f) Damaged, defective, or recalled cells or batteries. Lithium 
cells or batteries, that have been damaged or identified by the 
manufacturer as being defective for safety reasons, that have the 
potential of producing a dangerous evolution of heat, fire, or short 
circuit (e.g. those being returned to the manufacturer for safety 
reasons) may be transported by highway, rail or vessel only, and must 
be packaged as follows:
    (1) Each cell or battery must be placed in individual, non-metallic 
inner packaging that completely encloses the cell or battery;
    (2) The inner packaging must be surrounded by cushioning material 
that is non-combustible, non-conductive, and absorbent; and
    (3) Each inner packaging must be individually placed in one of the 
following packagings meeting the requirements of part 178, subparts L 
and M, of this subchapter at the Packing Group I level:
    (i) Metal (4A, 4B, 4N), wooden (4C1, 4C2, 4D, 4F), or solid plastic 
(4H2) box;
    (ii) Metal (1A2, 1B2, 1N2), plywood (1D), or plastic (1H2) drum; 
and
    (4) The outer package must be marked with an indication that the 
package contains a ``Damaged/defective lithium ion battery'' and/or 
``Damaged/defective lithium metal battery'' as appropriate.
    (g) Approval. A lithium cell or battery that does not conform to 
the provisions of this subchapter may be transported only under 
conditions approved by the Associate Administrator.


0
11. In Sec.  173.219, paragraph (b)(3) is revised to read as follows:


Sec.  173.219  Life-saving appliances.

* * * * *
    (b) * * *
    (3) Electric storage batteries and lithium batteries (life-saving 
appliances containing lithium batteries must be packed in accordance 
with Sec.  173.185 and Special Provisions A54 and A101 as applicable.);
* * * * *

0
12. In Sec.  173.220, paragraphs (d) and (f)(1) are revised to read as 
follows:


Sec.  173.220  Internal combustion engines, self-propelled vehicles, 
mechanical equipment containing internal combustion engines, battery 
powered equipment or machinery, fuel cell-powered equipment or 
machinery.

* * * * *
    (d) Lithium batteries. Except as provided in Sec.  172.102, special 
provision A101, of this subchapter, vehicles, engines, and machinery 
powered by lithium metal batteries, that are transported with these 
batteries installed, are forbidden aboard passenger-carrying aircraft. 
Lithium batteries contained in vehicles, engines, or mechanical 
equipment must be securely fastened in the battery holder of the 
vehicle, engine, or mechanical equipment, and be protected in such a 
manner as to prevent damage and short circuits (e.g., by the use of 
non-conductive caps that cover the terminals entirely). Except for 
vehicles transported by highway, rail, or vessel with prototype or low 
production lithium batteries securely installed, each lithium battery 
must be of a type that has successfully passed each test in the UN 
Manual of Tests and Criteria, as specified in Sec.  173.185, unless 
approved by the Associate Administrator.
* * * * *
    (f) Other hazardous materials. (1) Items containing hazardous 
materials, such as fire extinguishers, compressed gas accumulators, 
safety devices, and other hazardous materials that are integral 
components of the motor vehicle, engine, or mechanical equipment, and 
that are necessary for the operation of the vehicle, engine, or 
mechanical equipment, or for the safety of its operator or passengers, 
must be securely installed in the motor vehicle, engine, or mechanical 
equipment. Such items are not otherwise subject to the requirements of 
this subchapter. Equipment (other than vehicles, engines, or mechanical 
equipment), such as consumer electronic devices containing lithium 
batteries, must be described as ``Lithium metal batteries contained in 
equipment'' or ``Lithium ion batteries contained in equipment,'' as 
appropriate, and transported in accordance with Sec.  173.185 of this 
subchapter, and applicable special provisions. Equipment (other than 
vehicles, engines, or mechanical equipment), such as consumer 
electronic devices containing fuel cells (fuel cell cartridges), must 
be described as ``Fuel cell cartridges contained in equipment'' and 
transported in accordance with Sec.  173.230 of this subchapter.
* * * * *

PART 175--CARRIAGE BY AIRCRAFT

0
13. The authority citation for part 175 continues to read as follows:

    Authority: 49 U.S.C. 5101-5128, 44701; 49 CFR 1.81, 1.97.


0
14. In Sec.  175.8, add a new paragraph (a)(4) to read as follows:

[[Page 46040]]

Sec.  175.8  Exceptions for operator equipment and items of 
replacement.

    (a) * * *
    (4) Unless otherwise addressed by FAA regulation or policy (e.g. 
Advisory Circular), hazardous materials used by the operator aboard the 
aircraft, when approved by the Administrator of the Federal Aviation 
Administration.
* * * * *

0
15. In Sec.  175.10, paragraph (a)(18) is revised to read as follows:


Sec.  175.10  Exceptions for passengers, crewmembers, and air 
operators.

    (a) * * *
    (18) Except as provided in Sec.  173.21 of this subchapter, 
portable electronic devices (e.g., watches, calculating machines, 
cameras, cellular phones, laptop and notebook computers, camcorders, 
medical devices etc.) containing dry cells or dry batteries (including 
lithium cells or batteries) and spare dry cells or batteries for these 
devices, when carried by passengers or crew members for personal use. 
Portable electronic devices powered by lithium batteries may be carried 
in either checked or carry-on baggage. Spare lithium batteries must be 
carried in carry-on baggage only. Each installed or spare lithium 
battery must be of a type proven to meet the requirements of each test 
in the UN Manual of Tests and Criteria, Part III, Sub-section 38.3 and 
each spare lithium battery must be individually protected so as to 
prevent short circuits (e.g., by placement in original retail 
packaging, by otherwise insulating terminals by taping over exposed 
terminals, or placing each battery in a separate plastic bag or 
protective pouch). In addition, each installed or spare lithium battery 
must not exceed the following:
    (i) For a lithium metal battery, a lithium content of not more than 
2 grams per battery; or
    (ii) For a lithium ion battery, the Watt-hour rating must not 
exceed 100 Wh. With the approval of the operator, portable electronic 
devices may contain lithium ion batteries exceeding 100 Wh, but not 
exceeding 160 Wh and no more than two individually protected lithium 
ion batteries each exceeding 100 Wh, but not exceeding 160 Wh, may be 
carried per person as spare batteries in carry-on baggage.
* * * * *

0
16. In Sec.  175.30, add a new paragraph (a)(5) to read as follows:


Sec.  175.30  Inspecting shipments.

    (a) * * *
    (5) Described on alternative written documentation when authorized 
in accordance with Sec.  173.185(c)(4)(v). See Sec.  175.33 for 
alternative written documentation retention requirements.
* * * * *

0
17. In Sec.  175.33, add new paragraphs (a)(12) and (c)(5) to read as 
follows:


Sec.  175.33  Shipping paper and notification of pilot-in-command.

    (a) * * *
    (12) For shipments of lithium cells or batteries (UN3090 or UN3480) 
offered for transportation, or transported in accordance with Sec.  
173.185(c)(4)(v) of this subchapter, only the UN Number, proper 
shipping name, hazard class, and the total quantity at each specific 
loading location and whether the package must be loaded on a cargo only 
aircraft.
* * * * *
    (c) * * *
    (5) Retain a copy of the alternative written documentation when 
provided in accordance with Sec.  173.185(c)(4)(v)(B) of this 
subchapter or an electronic image thereof, or the information contained 
therein for 90 days at the airport of departure or the operator's 
principal place of business.
* * * * *

    Issued in Washington, DC, on July 29, 2014 under authority 
delegated in 49 CFR part 1.97.
Cynthia L. Quarterman,
Administrator.
[FR Doc. 2014-18146 Filed 8-5-14; 8:45 am]
BILLING CODE 4910-60-P