IIAR

In February 2016, the Occupational Safety and Health Administration (OSHA) announced that it is initiating a Small Business Advocacy Review (SBAR) Panel in order to get feedback on several potential revisions to OSHA’s Process Safety Management Program (PSM) standard. The effort comes as a part of the Obama Administration’s implementation of Executive Order 13650, “Improving Chemical Facility Safety and Security.” Under the Executive Order, OSHA has been charged to identify issues related to modernizing the PSM Standard with the goal of preventing major chemical accidents. In 2013, OSHA released a Request for Information (RFI) seeking input on potential changes to PSM. The RFI served as a prelude to rulemaking and enabled groups like IIAR to express concerns about potential changes to PSM. OSHA has now had the chance to go through the comments received in response to the RFI, including those from the coalition led by IIAR. The next step in the regulatory process is the convening of a SBAR Panel.

The Small Business Regulatory Enforcement Fairness Act requires OSHA to convene a SBAR Panel for all rulemakings that could have a significant impact on small businesses subject to the regulation. Since a large number of small businesses are subject to PSM, OSHA is compelled to convene a panel. The SBAR Panel will consist of members from OSHA, the Small Business Administration’s Office of Advocacy (SBA’s Office of Advocacy, or Advocacy), and the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget (OMB). The SBAR Panel will provide an opportunity for Small Entity Representatives (SERs) to provide input on how the Agency’s draft proposals may impact small businesses and other small entities, and suggest ways to minimize those impacts while meeting OSHA’s statutory goals.

OSHA has stated that it is conducting the SBAR Panel early in the regulatory process in the interest of assuring that the Panel’s report and recommendations can be fully considered in any subsequent rulemaking activities by the Agency. According to OSHA, the agency has not yet decided the full scope of issues that will be considered in a proposed rulemaking and has not yet drafted regulatory text. However, OSHA has provided the following list of PSM topics that will be considered by the SBAR Panel:

• Clarifying the PSM Exemption for Atmospheric Storage Tanks
• il and Gas-Well Drilling and Servicing
• Oil and Gas-Production Facilities
• Expanding PSM Coverage and Requirements for Reactivity Hazards
• Expanding the scope of Paragraph (e) by requiring safer technology and alternatives analysis
• Updating the List of Highly Hazardous Chemicals in Appendix A of the PSM Standard
• Revising the PSM Standard To Require Additional ManagementSystem Elements
• Amending Paragraph (d) of the PSM Standard To Require Evaluation of Updates to Applicable RAGAGEP
• Clarifying the PSM Standard by Adding a Definition for RAGAGEP
• Expanding the Scope of Paragraph (j) of the PSM Standard To Cover the Mechanical Integrity of Any Safety-Critical Equipment
• Revising Paragraph (n) of the PSM Standard To Require Coordination of Emergency Planning With Local Emergency-Response Authorities
• Revising Paragraph (o) of the PSM Standard To Require Third-Party Compliance Audits
• Expanding the Requirements of § 1910.109 To Cover Dismantling and Disposal of Explosives, Blasting Agents, and Pyrotechnics
• Several additional minor modifications which largely codify existing OSHA interpretations of the PSM standard
• Solicit feedback on any similar provision of EPA’s RMP rule and the PSM standard that could be streamlined.

Many of these topics, which were also included in the PSM RFI, would impact IIAR members with over 10,000 pounds of ammonia. While OSHA has not released any further details regarding the topics listed above, the RFI gives some perspective on the direction the agency may go. Below is a summary of the comments that IIAR submitted on some of the proposals of most interest and concern:

Expanding the scope of Paragraph (e) by requiring safer technology and alternatives analysis

Advancing inherently safety technology (IST) policies is a priority for both OSHA and EPA and the agencies published IST guidance in 2015. While the concept of utilizing inherently safer technologies is appropriate, the regulatory burden of requiring costly IST reviews tends to stifle innovation. For those companies who are already looking to improve safety by implementing IST options, a formal IST review would add costs to a process by forcing them to document the activities they are already performing. Small operations might not have the manpower or expertise to do this and lack the resources to hire it out cost effectively.

Revising the PSM Standard to Require Additional ManagementSystem Elements

Revising the PSM Standard to require additional management-system elements raises a number of questions and concerns. Because the PSM Standard is supposed to be a performancebased, there are concerns about specifying management-system metrics required by those subject to the standard. Requiring facilities to use and share metrics is more prescriptive than a performance-based standard should mandate. In addition, the PSM Standard already includes management practices in almost all elements.

Amending Paragraph (d) of the PSM Standard to Require Evaluation of Updates to Applicable RAGAGEP

The issue of how existing facilities evaluate updates to applicable RAGAGEP is an important and sensitive topic. As IIAR standards represent the primary source material for RAGAGEP in most ammonia refrigeration facilities, IIAR believes that guidance on the process for evaluating updates should be provided by standard developers. The addition of a regulatory requirement to evaluate updates to applicable RAGAGEP is not necessary. The Management of Change (MOC) and Process Hazards Analysis (PHA) sections of PSM and RMP, coupled with guidance from organizations like IIAR are sufficient to identify risks without a stand-alone regulatory requirement for evaluation of RAGAGEP.

Clarifying the PSM Standard by Adding a Definition for RAGAGEP

Adding a definition for RAGAGEP could be useful to help owners better understand requirements under the standard. A definition for RAGAGEP may also be helpful in reducing the instances of OSHA inspectors citing standards that are not as applicable to a given type of facility. For example, there have been occasions where OSHA inspectors have applied other industry standards to ammonia refrigeration facilities. Better defining RAGAGEP can reduce the misapplication of standards by inspectors and facilitate better understanding and application by facility owners. A definition of RAGAGEP should include methods and “whys”, but not go so far as how to do something like inspect, which becomes a maintenance procedure. A definition of RAGAGEP should also not take away the ability of a facility to identify which RAGAGEP they are applying to their operations.

Expanding the Scope of Paragraph (j) of the PSM Standard to Cover the Mechanical Integrity of Any Safety-Critical Equipment

Conceptually, the proposal to expand the coverage of the mechanical integrity element to all safety-critical equipment seems reasonable. For the ammonia refrigeration industry, covered facilities already must identify components, controls and PM frequency for them in accordance with OEM recommendations. In addition, IIAR is currently working on IIAR 6 that will be designed to specify the mechanical integrity requirements for all safety-critical equipment in an ammonia refrigeration system.

However, for such a change to be effective, a workable definition of “safetycritical” must be developed. The determination of what is safety-critical can be subject to broad interpretation. For example, the loss of any utility within the control of the owner could be construed to represent a significant risk to the process, even when the process is designed to safely shutdown on a loss of utilities. However, there would likely be no special requirement for the utilities out of control of the owner.

Revising Paragraph (n) of the PSM Standard to Require Coordination of Emergency Planning With Local Emergency-Response Authorities

Coordination with local emergency planning and response authorities is an important aspect of safety. Such coordination is already specifically required through EPA regulations such as Hazard Communication, Emergency Action and HAZWOPER. As a result, there is not a direct benefit of OSHA adding this recommendation into the PSM code. Rather than an additional regulations to PSM, OSHA should reference other federal codes applicable to emergency response such that there is not a burden created if one code is updated while another is not. This could cause contradiction and complexity/ confusion for implementation. Revising Paragraph (o) of the PSM Standard to Require Third-Party Compliance Audits Compliance audits are useful tools for evaluating a facility’s safety. However, IIAR is concerned about the intended definition of “third-party”. Third-party audits should not be limited to hiring outside personnel to perform the audit. Facilities should have the flexibility to choose external parties as well as utilize internal safety experts from other facilities or corporate headquarters to perform audits.

OSHA anticipates formally convening the SBAR Panel in February 2016 and engaging with SERs in March 2016. IIAR will continue to closely monitor the SBAR Panel and maintain an active engagement with OSHA to ensure that the perspectives of IIAR and its members are effectively communicated throughout the rulemaking process.