Property Types

Powder Coating Facilities

Powder coating operations apply a finish to metal parts by heating the powder and fusing it to a surface in a curing oven for a smooth coating. Although powder coating is considered a more environmentally friendly method of finishing parts than applying liquid finishes that contain solvents and release Volatile Organic Compounds (VOCs); powder coating operations still face environmental risks. Powder coatings can create dust in enclosed areas where they are being sprayed, and these dusts can create exposure for third-party pollution liability. Dusts can also ignite if a spark is produced and lead to a fire that results in toxic fumes and contaminated run-off. Powder coating operations require thorough cleaning of the parts and pretreatment for the powder coating to better bond physically to the metal. Methods used to clean parts include abrasive blasting, wiping with solvents, or washing with detergents. Pretreatments include etching the metal with an acid-based product or iron or zinc phosphating. Spills or releases of cleaning or pretreatment process chemicals can occur, resulting in environmental impacts.

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Environmental Exposures May Include

Solvent Storage Leaks & Chlorinated Vapor Intrusion
Raw Material & Waste Transfer Spills
Pretreatment Tank Leaks & Chemical Containment Breach
Pretreatment Waste Handling & Disposal Liability
Powder Coating Dust Fires & Firewater Run-off
Chemical & Waste Transportation Liability
Abrasive Blasting Dust & Silica Inhalation
TGIC Curing Agent Hazards & Powder Dust Inhalation

Solvent Storage Leaks & Chlorinated Vapor Intrusion

Solvents may be used to clean parts and stored on-site in containers or tanks. Spills or leaks of solvents can pose environmental risks, such as impacts on soil, groundwater, or surface waters. Volatile organic compounds from a release beneath or near a building can migrate by vapor intrusion through cracks in the foundation slab, utility openings, etc., impacting indoor air quality. Chlorinated solvents may be used or may have been used at powder coating facilities. Chlorinated solvents are particularly mobile and persistent and have caused subsurface contamination at several sites where they were used.

Raw Material & Waste Transfer Spills

A spill or release during receipt of raw materials, including solvents, pretreatment chemicals, etc., or removal of wastes or wastewater could result in an environmental condition.

Pretreatment Tank Leaks & Chemical Containment Breach

Chemicals such as acids, iron phosphate, zinc phosphate, chromates, etc., are used in pretreatment processes. Typically, this process involves immersing metal parts in a series of tanks. Leaks or spills from the tanks and lack of or failure of secondary containment systems could result in the migration of chemicals to floor drains, beneath facility floors, or outside the facility, leading to potential impacts to soil, groundwater, or surface waters or upsets to the sanitary sewer.

Pretreatment Waste Handling & Disposal Liability

Pretreatment processes can generate hazardous and non-hazardous wastes, including sludges and wastewater. These wastes and wastewaters require proper handling and storage. Spills from storage areas can cause environmental cleanup liability and pose health hazards to third parties. Improperly segregated and disposed of wastes can result in regulatory fines and lead to cleanup and environmental tort liability.

Powder Coating Dust Fires & Firewater Run-off

Powder coatings are typically applied in a spray booth. The dust from spraying powder coatings can be combustible when the dust-to-air ratio is elevated. Any spark can cause a fire. A fire at the facility could emit toxic fumes and smoke from the materials stored at the site or from a mix of materials resulting from the fire. Firefighting solutions such as water or foam could create contaminated run-off that spreads to nearby storm drains or properties, resulting in environmental cleanup and tort liability.

Chemical & Waste Transportation Liability

Transportation of process chemicals, wastes, or wastewater presents additional pollution risks and public exposures. A release during transit could lead to environmental liability risks for the powder coating facility as the generator, even if a third-party carrier is used.

Abrasive Blasting Dust & Silica Inhalation

Abrasive blasting, the process where abrasive material is propelled against a surface under pressure, may be used to clean off surface contaminants from metal parts to be powder coated, such as oils, oxides, and grease. If sands are used as the abrasive material, they contain crystalline silica. Breathing silica dust can cause silicosis. Dust generated from abrasive blasting operations can contain contaminants, and if not adequately controlled, they can impact third parties.

TGIC Curing Agent Hazards & Powder Dust Inhalation

Powder coating operations produce dust. Triglycidyl isocyanurate (TGIC) is a chemical compound formulated in some powder coatings as a curing agent. TGIC is a skin sensitizer, eye irritant and can cause allergic contact dermatitis and asthma. Inadequate or poorly maintained ventilation systems can lead to third-party bodily injury exposures from contact with dust from powder coatings.

Environmental Pollution Liability Can Provide Coverage For

On-site cleanup of new and pre-existing pollution conditions

Off-site cleanup of new and pre-existing pollution conditions

Third-party claims for bodily injury and property damage

Third-party claims for cleanup costs

Both sudden and gradual pollution conditions

Defense of third-party claims

Emergency response costs

Natural resource damage

First and third-party transportation pollution liability

Loading and unloading

Business interruption resulting from pollution conditions

Aboveground and underground storage tanks

Non-owned disposal sites

Crisis/reputation management

Civil fines and penalties

Mold, legionella, and more

Illicit abandonment

Claims Scenarios & Examples

A powder coating facility generated sludge from the phosphating process they used to clean parts. The sludge was removed and taken to a third-party disposal facility over many years. The disposal facility went out of business and later became a Superfund site. The powder coating facility was named a Potentially Responsible Party due to its historic disposal of sludge at the disposal site.
While moving drums from the loading dock area into the facility, a drum of powder coating that contained TGIC was accidentally punctured. It was a windy day when the release occurred, and dust from the spill was blown around. The delivery truck driver was standing near the drum when it was punctured and exposed to dust, which caused his eyes to burn, and he experienced difficulty breathing. He was taken to the hospital. The driver sued the facility for third-party bodily injury damages.
A powder coating operation previously used sandblasting to pre-clean its parts. A facility used silica sand inside a blast room with dust collection. The ventilated blast room air was vented to the outside next to the intake of a neighboring building. Employees of the neighboring business sued the powder coating facility, claiming that they were exposed to silica dust from the facility.
A facility was performing iron phosphating as a pretreatment before powder coating. Iron phosphating is performed at the facility by dipping metal parts into several tanks. The tanks were not provided with secondary containment. The pickling (acid cleaning) tank developed a leak that flowed from the tank outside and to a storm drain. The storm drain discharged to a nearby creek, causing a fish kill. The company was sued for Natural Resource Damage.
A powder coating facility suffered a large dust fire in the powder coating area of their building. The fire came from the powder collector. The dust-to-air ratio in the powder collector was such that a spark set off a fire. Toxic smoke from the fire resulted in the evacuation of neighboring businesses and residents. Additionally, contaminated run-off from the fire impacted soils and flowed to an adjacent creek. The company paid significant expenses for cleanup and suffered business interruption and third-party bodily injury claims from neighboring businesses and residents.
A powder coating facility used a chrome-containing rinse as the final step in zinc phosphating. The zinc phosphating and chrome-containing rinse were used to clean and provide a corrosion-resistant coating to steel parts before powder coating. Over time, chrome-containing rinse had been dripped on the floor, which had some cracking, and the chrome solution migrated to the subsurface. A site investigation discovered that this historical use had impacted soils beneath the phosphating line. Cleanup required moving existing equipment, removing flooring, excavating impacted soils, and replacing the concrete floor.
A small powder coating company operated process tanks that leaked chlorinated solvents through cracks in the concrete floor, causing extensive soil and groundwater contamination. The contamination posed risks to nearby sensitive water resources. Investigations were undertaken, and extensive risk modeling was prepared to evaluate impacts on local water resources. Significant costs were incurred as the source area and impacted soils had to be removed, and a groundwater treatment system had to be installed. The powder coating company was liable for the environmental cleanup costs.

Final Consideration

Your business can be faced with the cost to defend itself against allegations or legal action from pollution related events, regardless if you are fault or not. Having the proper insurance coverage in place will help fund the expenses incurred to investigate or defend against a claim or suit and provide you with environmental claims handling expertise.

This environmental risk overview offers a general understanding of potential risks and may not reflect all risks associated with your business. Environmental Risk Professionals has compiled this overview for informational purposes only. This overview does not constitute legal opinion or advice, nor does it establish a consultant-client relationship. This overview is not intended to guide project parties in interpreting specific contracts or resolving disputes; such decisions may require consultation with counsel and depend on various factors. © 2025 Environmental Risk Professionals, LLC

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