IIAR

In response to the tragic accident last year in West, Texas, President Obama issued Executive Order (EO) 13650, Improving Chemical Facility Safety and Security. The EO is intended to enhance the safety and security of chemical facilities and reduce risks associated with hazardous chemicals to facility workers and operators, communities, and responders.

The Executive Order directed federal departments and agencies to:

• Improve operational coordination  with, and support to, state and local partners
• Enchance Federal agency coordination and information sharing
• Modernize policies, regulations and standards
• Work with stakeholders to identify best practices

Since the signing of the EO, a working group of federal agencies led by the Department of Homeland Security (DHS), Occupational Safety and Health Administration (OSHA) and Environmental Protection Agency (EPA) have been working to implement the order and identify additional actions to improve chemical safety and security. Some of the potential policy changes could have a significant impact on the cold chain, particularly companies with over 10,000 pounds of ammonia subject to Process Safety Management (PSM) and the Risk Management Program (RMP).

For example, OSHA released a Request for Information seeking public comment on proposed changes to the PSM standard. IIAR partnered with the American Frozen Food Institute (AFFI), American Meat Institute (AMI), Global Cold Chain Alliance (GCCA) and the Refrigerating Engineers and Technicians Association (RETA) in communicating concerns about the proposals.

The EO also tasked the working group with providing a report to President Obama by the end of May 2014 highlighting the actions taken to date and future recommended actions. The report entitled Actions to Improve Chemical Facility Safety and Security – A Shared Commitment was released on June 6, 2014. The report highlights activities undertaken to improve chemical facility safety and security and provides a consolidated plan of actions to further minimize chemical facility safety and security risks.

The status report includes an analysis of existing regulatory programs to inform immediate actions as well as a consolidated Federal Action Plan of priority actions. The Federal Action Plan is organized by five thematic areas:

• Strengthen Community Planning  and Preparedness
• Enhance Federal Operational Coordination
• Improve Data Management
• Modernize Policies and regulation
• Incorporate Stakeholder Feedback and Develop Best Practices

Of the five thematic areas, the one with the greatest potential to impact companies in the cold chain is “Modernize Policies and Regulation.” The report details a series of action items under this theme to change regulations including PSM and RMP. Below is a list of the actions of most interest and concern:

MODERNIZING OSHA’S PSM STANDARD TO IMPROVE SAFETY AND ENFORCEMENT

Building on the PSM Request for Information, OSHA plans to move forward with developing a proposed rule to modernize the PSM standard. Key actions recommended in the action plan include:

• Clarify the PSM standard to incorporate lessons learned from enforcement, incident investigation, and advancements in industry practices, root cause analysis, process safety metrics, enhanced employee involvement, third-party audits, and emergency response practices.
• Adding substances or classes to substances to the PSM Appendix A List of Highly Hazardous Chemicals and providing more expedient methods for future updates.
• Expanding coverage and requirements for reactive chemical hazards, which have resulted in many incidents.
• Continuing harmonization with EPA’s and RMP regulation. 
• Requiring analysis of safer technology and alternatives.
• Requiring coordination between chemical facilities and emergency responders to ensure that emergency responders know how to use chemical information to safely respond to accidental releases, possibly including exercises and drills.

EPA’S RISK MANAGEMENT PROGRAM (RMP)

Because of the close connection between PSM and RMP, the action plan proposes modernizing EPA’s RMP regulations in a similar fashion to PSM. The action plan indicated that EPA would be publishing a Request for Information related to RMP. On July 24, 2014, the Request for Information (RFI) entitled: Accidental Release Prevention Requirements: Risk Management Programs under the Clean Air Act, Section 112(r) (7) was released. Through the RFI, EPA is requesting public comment on potential changes to the Risk Management Program and is likely the first step towards rulemaking.

The RFI is divided into two main sections. The first section parallels many of the issues raised in the RFI for Process Safety Management. The second section addresses policies not included in the RFI for PSM.

ITEMS IN OSHA’S RFI RELEVANT TO EPA’S RMP REGULATION:

• Removing Certain Substances from the List or Raising their Threshold Quantity 
• Lowering the Threshold Quantity for Substances Currently on the List
• Additional Risk Management Program Elements
• Define and Require Evaluation of Updates to Applicable Recognized and Generally Accepted Good Engineering Practices 
• Extend Mechanical Integrity Requirements to Cover Any SafetyCritical Equipment
• Require Owners and Operators to Manage Organizational Changes 
• Require Third-Party Compliance Audits
• Effects of OSHA PSM Coverage on RMP Applicability

ADDITIONAL ITEMS FOR WHICH EPA REQUESTS INFORMATION:

• Safer Technology and AlternativesAnalysis – (Note: This is a potential pathway towards requiring the assessment and mandatory implementation of “inherently safer technologies”.) 
• Emergency Drills to Test a Source’s Emergency Response Program or Plan
• Adding new requirements for automated detection and monitoring systems, or adding performance measures for facilities already using these systems.
• Additional Stationary Source location Requirements
• Compliance with Emergency Response Program Requirements in Coordination with Local Responders 
• Incident Investigation and Accident History Requirements
• Worst Case Release Scenario Quantity Requirements for Processes Involving Numerous Small Vessels Stored Together
• Public Disclosure of Information to Promote Regulatory Compliance and Improve Community Understanding of Chemical Risks
• Threshold Quantities and Off-site Consequence Analysis Endpoints for Regulated Substances Based on Acute Exposure Guideline Level Toxicity Values 
• Program 3 NAICS Codes Based on RMP Accident History Data
• “The Safety Case” Regulatory Model – The “safety case” regulatory model66 is a framework for regulating high-risk industries where owners or operators of industrial facilities are required to demonstrate to the regulator that they have reduced risks to a level that is “as low as reasonably practicable”, or ALARP.
• Streamlining RPM Requirements

 IIAR is following a similar approach to the RMP RFI as it did for the PSM RFI. A task force has been formed to analyze EPA’s proposed changes to RMP and develop a response. IIAR is also reaching out to likeminded partners to form a coalition around shared concerns related to the RMP RFI.

BUILDING A STRONGER CFATS PROGRAM

The action plan also includes items designed to strengthen the Chemical Facilities Anti-Terrorism Standards (CFATS) program. DHS plans to solicit public comment on an ANPRM on potential updates to the list of chemicals of interest (COI) and other aspects of the CFATS regulation. Specific activities include:

• Improve the methodology used to identify and assign risk tiers to highrisk chemical facilities.
• Coordinate chemical facility security activities and explore ways to increase harmonization among chemical facility security regulatory programs.
• Identify facilities that should have submitted a CFATS Top-Screen but failed to do so.
• Work with Congress to seek longterm CFATS authorization to ensure that an authority lapse does not occur and to provide regulated chemical facilities with the certainty they need as they consider making substantial capital investments in CFATS-related security measures.
• Work with Congress to pursue action to streamline the CFATS enforcement process to allow DHS, in extreme circumstances, to immediately issue orders to assess civil penalties or to close down a facility for violations, without having to first issue an order calling for correction of the violation.

DEVELOPING GUIDANCE AND OUTREACH PROGRAMS TO HELP INDUSTRY UNDERSTAND PROCESS SAFETY AND SECURITY REQUIREMENTS AND BEST PRACTICES

In addition to proposing regulatory changes, the action plan suggests the development of resources to help industry understand regulatory requirements and best practices. This would include guidance on EPA and OSHA process safety terminology, how to conduct root-cause analyses and assistance for small businesses. OSHA would consolidate best practices for process safety and metrics from OSHA Voluntary Protection Program (VPP) facilities. The order also proposes the development of a comprehensive regulatory fact sheet covering EPA, OSHA, and DHS programs, for State regulators, facilities, stakeholders, and other non-Working Group Federal agencies as well as a checklist of Federal Regulations that stakeholders can use to determine regulations applicable to their facilities.

Implementation of the Executive Order remains to be a high priority for the Obama Administration and the working group’s report to the President highlights numerous regulatory changes that will be considered. Many of the changes to programs such as PSM and RMP have the potential to impact companies in the cold chain. IIAR will continue to monitor implementation and actively engage with agencies throughout the process.