III. Summary and Explanation of the Final Rule
This section contains an analysis of the record evidence and policy decisions pertaining to the various provisions of the standard.
The Occupational Safety and Health Act (OSH Act) defines an occupational safety and health standard as a standard which requires conditions, or the adoption or use of one or more practices, means, methods, operations, or processes, reasonably necessary or appropriate to provide safe or healthful employment and places of employment.
Under section 6(b) of the OSH Act, the Secretary (of Labor) may by rule promulgate, modify or revoke any occupational safety and health standard in a prescribed manner. The Act directs the Secretary of Labor to consider in promulgating standards, national consensus standards. In this instance, there is no existing consensus standard that addresses process safety management of highly hazardous chemicals.
The proposed process safety management standard contained the following paragraphs:
Purpose: Paragraph (a) Application: Paragraph (b) Definitions: Paragraph (c) Process safety information: Paragraph (d) Process hazard analysis: paragraph (e) Operating procedures: Paragraph (f) Training: Paragraph (g) Contractors: Paragraph (h) Pre-startup safety review: Paragraph (i) Mechanical integrity: Paragraph (j) Hot work permits: Paragraph (k) Management of change: Paragraph (l) Incident investigations: Paragraph (m) Emergency planning: Paragraph (n) Compliance safety audits: Paragraph (o)
In the final standard, OSHA has added two additional paragraphs: employee participation and trade secrets. OSHA determined that the logical placement of the paragraph regarding employee participation should be at the beginning of the rule since the provisions require that employers consult with employees and their representatives on the general development of a process safety management program, as well as on the process hazards analyses. In order to accommodate the placement of the provisions concerning employee participation in the beginning of the final standard but also to minimize any unnecessary redesignation of paragraphs, OSHA has decided to remove the letter designation "(a)" from the "purpose" paragraph. This results in the following changes:
Purpose Application: paragraph (a) Definitions: paragraph (b) Employee participation: paragraph (c)
The paragraph on trade secrets has been added to the end of the standard and becomes new paragraph (p). Therefore, the paragraphs in the final rule are designated in the following manner:
Purpose Application: Paragraph (a) Definitions: Paragraph (b) Employee participation: Paragraph (c) Process safety information: Paragraph (d) Process hazards analysis: Paragraph (e) Operating procedures: Paragraph (f) Training: Paragraph (g) Contractors: Paragraph (h) Pre-startup safety review: Paragraph (i) Mechanical integrity: Paragraph (j) Hot work permit: Paragraph (k) Management of change: Paragraph (l) Incident investigation: Paragraph (m) Emergency planning and response: Paragraph (n) Compliance safety audit: Paragraph (o) Trade secrets: Paragraph (p)
A significant number of commenters and hearing participants supported the proposed standard and its purpose (e.g., Ex. 3: 10, 17, 18, 22, 25, 26, 28, 29-32, 38, 39, 40, 42, 45, 46, 53, 59, 69, 70, 71, 72, 76, 77, 79, 80, 82, 83, 86, 87, 91, 95, 96, 97, 101, 103, 104, 106, 107, 108, 113, 117, 120, 121, 127, 129, 134, 143, 146, 152, 153, 158, 162, 164, 168, 171; Ex. 89; Ex. 91; Ex. 112; Ex. 138; Tr. 730, 779, 1204, 1594, 1614, 1802, 1998-99, 2155, 2172, 2245, 2506, 2570, 2652, 2768, 3115, 3157, 3236, 3345, 3404, 3442, 3461, 3604, 3753). A participant from The Upjohn Company (Ex. 3: 22) stated:
We are pleased at this proposed rule (1910.119) which will require all employers to implement programs to ensure the safety and health of those employees working with and around processes which involve highly hazardous chemicals. In addition, we are encouraged that the effort to establish this standard included cooperation from business and government to propose a standard that is both beneficial and workable.
The Food and Allied Service Trades, of the AFL-CIO, (Ex. 3: 25, p.3) remarked:
The proposed rule is well-intended and there is little question that such regulation is needed. Recent events * * * underscore this need. These events include not only the catastrophic explosions that occurred at Phillips Petroleum and Arco Chemical in the Houston area, but hundreds of smaller explosions and disasters that were not as widely reported by the press.
BP Oil Company (Tr. 1802) stated:
We are here today to comment on a proposed regulation which we regard as of major importance to our industry. We strongly support the Occupational Safety and Health Administration's approach to protecting workers and the public from industrial operation hazards.
Finally, the United Steelworkers of America (Tr. 2231) observed:
But the real problem is that OSHA has no standard requiring process hazard analysis, written operating procedures, adequate training in process safety, periodic safety reviews, quality assurance for critical equipment or the investigation of near-miss accidents.
Had such a standard been in place at Neville Chemical, Jim Thompson would be alive today. So might all the other chemical workers killed by accidental releases of hazardous chemicals in the past several years including the 40 in Pasadena and Channelview. Clearly, it is time to give OSHA inspectors the tools they need to prevent catastrophic accidents.
It is also time to give workers the tools they need to protect themselves and their communities.
Participants in the rulemaking also supported OSHA's development of a performance-oriented standard (e.g., Ex. 3: 27, 33, 39, 45, 46, 48, 69, 76, 134, 146, 161, 162, 171; Ex. 91; Ex. 133; Ex. 138; Tr. 1009, 1999, 2284, 3726). The Chemical Manufacturers Association (Ex. 3: 48) remarked:
Initially CMA would like to commend OSHA on its efforts to craft a comprehensive performance based standard addressing process safety management of highly hazardous chemicals. As CMA has commented in past rulemakings, performance language capitalizes on industry's ingenuity and capability to effectively reduce hazards as they may be uniquely applied to a particular safety concern.
Ashland Petroleum Company (Ex. 3: 80) stated:
Ashland * * * is generally supportive of the efforts of the Secretary and of the Occupational Safety and Health Administration with respect to this proposed regulation. While our internal commentors had divided between a desire for specificity and the obvious value of the non-detailed performance approach, ultimately we believe the "performance standard" approach is the best way to regulate a wide variety of situations for which a common end is desired.
The American Society of Safety Engineers (Ex. 3: 146, p.2) noted:
The Society commends OSHA's use of a performance standard rather than a specification rule, believing this is the better means to help ensure each affected facility address its individual situation.
Many participants in the rulemaking acknowledged their belief that a process safety management standard is the most effective approach available in the prevention of catastrophic releases and others acknowledge their belief that the standard will improve the safety and health of employees (e.g., Ex. 3: 71, 72, 91, 94, 95, 96, 101, 106, 113, 120, 121, 127, 129, 158; Ex. 131; Tr. 1998, 3719). For example, Amoco (Ex. 3: 95) found that:
In general, we are very favorably impressed with the regulation as written. This standard is comprehensive, and when properly applied, should be effective in reducing loss of life, serious injury, and damage to property.
The American Petroleum Institute (API) (Ex. 3: 106) indicated:
API member companies support OSHA's effort to develop an effective process safety management rule. API believes process safety management is the most effective approach available in the prevention of catastrophic releases, a goal which we share with OSHA completely.
Finally, Oryx Energy Company (Tr. 3719) testified:
I think the proposed rule and 750 [API RP 750] -- you know, they are similar -- they will both accomplish the mission of making a safer workplace. I think -- I know of no other system that is better than the system that is proposed by OSHA.
Before discussing the provisions of the final standard, OSHA would like to address several issues that were brought up during the rulemaking. First, many participants asserted that OSHA should permit required information to be stored electronically or on computers. Electronic storage or computerized storage of records and information required by this standard is permissible, as long as it is readily accessible and easily understood.
Second, in Issue 10 of the proposal (55 FR 29159) OSHA asked whether provisions should be delayed or phased-in (timeframes for conducting process hazard analyses were discussed in a separate issue, Issue 3 at 29158). Participants suggested a variety of schedules (e.g., Ex. 3: 41, 45, 48, 53, 69, 81, 96, 101, 106, 113, 127, 134; Ex. 138; Tr. 735, 1616, 3241). However, OSHA has decided that, with the exception of allowing a phase-in period for paragraph (d), process safety information, and paragraph (e), process hazards analysis, no other phase-in period is necessary or warranted. OSHA realizes, as it does with any other newly promulgated standard, that employers will be working toward implementation of the provisions contained in the standard as quickly as possible. The standard will become effective in 90 days, thereby giving employers a brief period to familiarize themselves with the provisions of the standard and begin its implementation. OSHA believes this schedule is practical and feasible.
Third, also in Issue 10, OSHA asked whether it is necessary for all of the covered industries to meet all of the proposed provisions. OSHA was concerned about the potential impact on small businesses. Most of the participants who addressed this issue believed that small facilities should not be exempted if they have the threshold quantity of chemicals in their processes since the potential for a catastrophe is based on the amount of chemical present rather than on the size of facility (e.g., Ex. 3: 9, 20, 38, 47, 59, 69, 95, 103, 138; Tr. 2010-1, 2176, 3421). Several of these participants suggested that OSHA provide special assistance to small employers. OSHA agrees with participants that plants should be covered based on whether they have the threshold quantity of a covered highly hazardous chemical. OSHA also agrees with the recommendation suggesting that OSHA provide special assistance to small businesses and is considering this issue at this time. As an immediate step, OSHA has developed nonmandatory appendices which will assist in providing small businesses with guidance on complying with the process safety management standard and sources of further information and assistance (Appendix C and Appendix D respectively). Additionally, the Agency is developing a compliance assistance "outreach" program to assist small businesses.
Finally, in Issue 11 (55 FR 29159) of the proposal, OSHA asked whether employers, when they have a threshold quantity of a highly hazardous chemical as specified by the standard, should be required to notify the OSHA Area Office of their location. Other entities which regulate potentially catastrophic workplaces require notification of the regulating authority.
Numerous participants addressed this issue. Some participants believed that notification should be required (e.g., Ex. 3: 20, 25, 71, 86, 99, 115; Ex. 101, Tr. 2253). Other participants indicated that while they did not see a benefit to notification, they would not object if a notification requirement was kept simple (e.g., Ex. 3: 26, 28, 26, 28, 69, 113, 120; Tr. 3279, 3376). Still others objected to notification as an unnecessary burden, and in some cases observed that EPA already requires notification or that perhaps OSHA should access the information already required to be submitted to EPA (e.g., Ex. 3: 30, 38, 64, 80, 109, 113, 120, 122, 127, 134, 141, 146; Ex. 103, Tr. 1025). For example, Organization Resources Counselors (Ex. 131, p.11) indicated that:
Before OSHA inserts such a requirement into the standard, it should determine what use it will make of such notification and whether or not the information is already available from other resources.
OSHA has decided not to require notification in the final standard. OSHA believes requiring such information would be redundant with requirements that already exist under SARA and under the Clean Air Act Amendments which require reporting. Since similar information is already required to be reported, OSHA will work with EPA to obtain needed plant location information, instead of placing a redundant burden on employers.
On September 19, 1990, the Office of Management and Budget (OMB) filed comments on the process safety management proposal (Ex. 3: 14). OMB raised several concerns about the proposal. OMB observed that:
(1) OSHA failed to consider alternative regulatory options;
(2) The effectiveness of OSHA's approach is uncertain;
(3) The costs of the standard may be higher than estimated and may adversely affect profitability;
(4) The standard may have high costs and few benefits for small employers and, therefore, could be anticompetitive; and
(5) OSHA should consider a sunset provision in the final rule that would cause the rule to expire after five years if it does not have the intended effect of providing significant reductions in the number of workplace accidents associated with hazardous chemicals.
OSHA has carefully evaluated the OMB comment and believes that the modifications to the proposed rule and the issues discussed below are responsive to the OMB concerns. The major concerns are addressed below.
(1) OMB stated that OSHA had failed to consider alternative regulatory options that might protect workers equally well at lower cost (Ex. 3: 14, p.1-3). OSHA believes that its latitude to consider regulatory options such as those contemplated by OMB is somewhat limited by the Clean Air Act Amendments (CAAA). For example, in section 304 of the CAAA, OSHA was directed to enact a chemical process safety standard containing certain minimum elements within one year. The Clean Air Act Amendments specified 14 elements which OSHA must include in the process safety standard. OSHA has included these elements in its final process safety management standard. OMB suggested that OSHA consider an alternative regulatory approach that allows firms to use the results of the hazard analysis to determine which of the other safety requirements are appropriate. The Congressional mandate does not allow OSHA this flexibility. In addition, participants addressed this issue (Ex. 131; Tr. 307, 818) and the consensus was that the provisions of the standard were inextricably intertwined and they could not be considered separately without adversely affecting the contemplated effectiveness of the rule. For example, the Organization Resources Counselors (ORC) stated that its member companies "indicate that most, if not all, process related incidents involve a breakdown of one or more of OSHA's Process Safety Management elements" (Ex. 131, p.9). American Cyanamid Company (Ex. 3: 127) observed:
We concur with the concept of a comprehensive management system which addresses technology, equipment, procedures, training and management oversight. Deficiencies in any one of these areas can lead to a breakdown in process safety and increase the potential for a serious accident.
In addition, OMB suggested that OSHA should look more closely at the potential for accidents from various types of hazardous chemicals (Ex. 3: 14, p.2). In establishing the list of substances to be regulated under the process safety management rule, OSHA carefully considered the potential for catastrophic events posed by a large number of chemicals. In order to select chemicals with catastrophic potential, OSHA consulted the lists developed by the Environmental Protection Agency and Department of Transportation and various states with regulatory experience in this area; namely Delaware and New Jersey. In developing the list of covered substances, OSHA also reviewed materials on this subject developed by the World Bank, the European Economic Community (the Seveso Directive), the National Fire Protection Association and ORC. While it is true that all chemicals on the list do not have equal catastrophic potential, OSHA addressed this issue in two ways. It developed appropriate thresholds for each of these chemicals by consulting with the sources above and relying on its own expertise, and it developed the flexible performance-oriented approach of the standard by mandating a process hazard analysis which will itself indicate the necessary safety precautions to take according to the incidence of use in a particular industrial setting.
(2) OMB claimed that the effectiveness of OSHA's approach is uncertain (Ex. 3: 14, p.3-4). In its preliminary regulatory impact analysis (PRIA, Ex. 4), OSHA claimed that after the standard had been in effect for 5 years, injuries and illnesses resulting from potentially catastrophic incidents would be reduced by at least 80% (Chapter V-14). This effectiveness rate is consistent with that used in other OSHA Regulatory Impact Analyses such as Electrical Safety-Related Work Practices (Final Rule, 55 FR at 32011, August 6, 1990, Regulatory Impact Assessment); Control of Hazardous Energy Source (Lockout/Tagout) (85 percent, Final Rule, 54 FR at 36685, September 1, 1990, Regulatory Impact Analysis); Permit Required Confined Spaces; Notice of Proposed Rulemaking (54 FR at 24097, June 5, 1989, Benefits); and Hearing Conservation (Final Regulatory Analysis of the Hearing Conservation Amendment, U.S. Department of Labor, January 1981, Chapter III-27; benefits of 85% at equilibrium from the hearing conservation amendment).
Participants also acknowledged their belief that the process safety management standard will be substantially effective in improving safety. For example, Arco Chemical (Ex. 3: 71) stated:
ARCO Chemical Company strongly endorses OSHA's proposed rulemaking * * * ACC's President and Chief Executive Officer, stated that ACC shares " * * * the Congress' desire to further improve process safety management in the chemical industry," and that ACC believes that OSHA's proposed rules "- as minimum standards - will substantially improve safety across the entire U.S. process industry."
American Cyanamid Company (Ex. 3: 127) remarked:
American Cyanamid believes that the proposed standard, if implemented, will substantially reduce the risk of accidental releases, fires and explosions from processes involving highly hazardous substances.
Additionally, the Organization Resources Counselors (Ex. 131, p.9-10) stated:
Given effective implementation and compliance with the provisions of the proposed standard, we agree with OSHA's estimate of at least 80% reduction in serious process incidents.
Quantitative evidence from Air Products and Chemicals, Inc., suggests that instituting a comprehensive process safety program which includes a hazard analysis could result in an even more significant reduction in accident and injury rates (97.5%; RIA, Chapter V-11-12). Moreover, empirical data from a senior safety consultant showed that in dealing with 500 companies of all sizes (over a 15 year period) "those committed to the development of a long-term program" similar to that described in the process safety management standard, achieve median improvement in their safety programs after the third year of implementation of nearly 75% (RIA, Chapter V-13).
Although one of the studies cited by OMB (the St. John's River Power Plant project) only accomplished a 56% decrease in accidents, it is important to note that the potential hazards faced by the plant studied were significantly lower than those posed by the use and handling of the threshold amounts of chemicals covered by the process safety management rule; and the program studied was not as comprehensive as that contemplated in the PSM standard. It is not unreasonable to assume that where, as here, highly hazardous chemicals are being used in potentially catastrophic amounts and there is a comprehensive standard in effect that has the force and effect of law, that an additional 25% effectiveness could be accomplished. While one cannot predict benefits absolutely it would seem that the 80% estimate assumed by the RIA is reasonable and supported by substantial evidence in the record as a whole.
(3) OMB also indicated that the costs may be higher than estimated and may adversely affect profitability (Ex. 3: 14, p.4-6). The PRIA predicted that compliance with the proposed standard would cost $638 million in direct annualized gross costs (estimated per year for a ten year period). These estimates were based in large part on the Kearney/Centaur Report, "Proposed OSHA Rule for the Process Hazards Management of Highly Hazardous Chemicals: An Industry Profile, Cost Assessment and Benefits Analysis" (Ex. 5). A number of commenters believed that the PRIA had underestimated the costs of complying with the proposed standard (e.g., 3: 45, 69, 95, 106, 109, 150, 153). In response to comments in the record, OSHA updated and refined the Kearney/Centaur industry profile, its estimates of current industry compliance with the proposed process safety management standard, and the estimate of the number of processes per establishment that would be covered by the standard (RIA, Chapter V). This resulted in the calculation of increased costs of compliance with the process safety management standard. The final RIA predicts gross costs of $863.5 million/year during the first 5 years that the standard is in effect (as opposed to the $638 million estimated by the PRIA)(RIA, Chapter IV-11) and $390.1 million/year during the next 5 years. In order to better understand the true costs associated with the process safety management rule, the gross cost of compliance must then be adjusted downward to account for the many benefits of the standard, such as increased productivity, decreased property damage, and decreased fatalities and injuries. When these offsets are taken into account, OSHA predicts that the standard will cost approximately $143.5 million per year for the first 5 years. Cost savings are expected to exceed direct costs for most industry groups in years 6 through 10.
OSHA also looked at the effect of the costs of compliance on the profitability of the affected industries and found that, assuming that the affected companies would not pass on any of the costs of compliance to customers (a worst case assumption), in the first five years compliance with the process safety management rule might decrease profits anywhere from .09 percent to 15.7 percent depending on the industry group. Worst-case profit impacts would average 1.1 percent for large establishments and 3.2 percent for small establishments. Therefore the final figures show that the standard is not only economically feasible, but it will not unreasonably affect the profitability of the affected industries and is well within the mandates of the CAAA, the Occupational Safety and Health Act and Executive Order 12291.
(4) OMB also believed that the process safety management rule might have high costs and few benefits for small employers and, therefore, could be anticompetitive (Ex. 3: 14, p.6-7). As stated above, the final RIA indicates the gross costs of complying with the process safety management standard will be $863.5 million/year during the first 5 years that the standard is in effect and $390.1 million/year during the next 5 years for all industry. Of this total gross cost of compliance, small business will bear approximately $88.9 million/year during the first 5 years that the standard is in effect and $33.0 million/year during the next 5 years. While accounting for approximately 10 percent of costs, small firms will realize considerable benefits from compliance; 21 percent of fatalities avoided and 9 percent of lost-workday injuries avoided will occur in small establishments.
OSHA's estimates for small-firm costs declined in the final impact analysis after incorporating the ideas of inventory reduction and a learning-curve effect during compliance. A small business might reduce the potential hazard by purposely controlling its on-site inventory of highly hazardous chemicals by ordering more frequent, smaller shipments so that they do not exceed the threshold for coverage set forth in the rule. Also, they may segregate their inventory by dispersing the storage around the worksite so that the release of a highly hazardous chemical from one storage area would not cause the release of the other inventory stored on site. This remote storage approach would also be a feasible alternative. Moreover, small employers who use batch processes may be able to use a generic approach to the required process hazards analysis which would help to further reduce the estimated cost of compliance. For example, a generic process hazard analysis of a representative batch might be used where there are only small changes in the process chemistry and this is documented for the range of batch processes (see Appendix C).
Also, as a general rule, small employers have greater flexibility within their workplaces than do large employers. Employees may be trained to do more than one job and have a greater understanding of the interrelationship of the different factors that can adversely affect the process and produce a potentially catastrophic incident.
Some participants believe that there will be long-term benefits to full implementation of process safety management (e.g., Ex. 11: 87; Ex. 99; Ex. 131; Tr. 1050-52, 3052). For example, evidence in the record from a manager of a small plant which had recently undergone the experience of implementing process safety management practices and techniques indicates that the benefits of the standard can be substantial and realizable (Ex. 131, Attachment III, p. 5-6). For example, he wrote:
The benefits of a comprehensive process safety program are substantial, but are often difficult to quantify. This is particularly true if one tries to develop a traditional "return on investment."
Perhaps the biggest benefit is in the alteration of thinking that is inherent to the system. It became apparent that there was a subtle shifting of approach to problems by plant staff * * *. Our small organization was quietly infused with a rebirth of innovative thinking. Process technology that was more than 35 years old was routinely being questioned and inspected for safer ways to do the task at hand. This quickly led to the same questioning being applied to process improvement * * *.
The net result has been not only that safety performance has been enhanced, and the process operational risks materially reduced, but the resultant attitude and approach to daily tasks have resulted in material gains in directly accountable issues such as process yields. Ultimately, I believe that this thoroughness and rigorous training approach will result in cost savings to a small plant site on the order of 4 to 7 percent of an operating budget * * *.
(5) OMB also felt that OSHA should consider a sunset provision in the final rule that would cause the rule to expire after five years if it does not have the intended effect of providing significant reductions in the number of workplace accidents associated with hazardous chemicals (Ex. 3: 14, p.3). In its proposal, OSHA did not propose a specific time frame for compliance. The final OSHA rule, because of feasibility considerations, does not become fully effective for five years and if the comment is read literally, the rule might "set" before it was fully implemented. Therefore, the 5 year "sunset" timeframe would not be compatible with the process safety management regulatory framework. The process safety management standard is based on the Occupational Safety and Health Act and the Clean Air Act Amendments of 1990 (CAAA). The CAAA does not contemplate a "sunset" provision and this is probably because we know that the chemicals which this standard regulates are intrinsically hazardous and the hazard will not go away as long as these chemicals are being used in industrial processes. Even if the OMB comment were read to mean that OSHA should consider a sunset provision 5 years after the rule becomes effective, there is nothing in the present record that would support the inclusion of a sunset provision in the final rule. The Agency believes that this final rule will be highly effective and will significantly reduce workplace accidents and injuries. This view is supported by substantial evidence in the record as a whole. Therefore it would be arbitrary and contrary to the record evidence for the Agency to include a sunset provision in the final rule. Moreover, it is questionable whether this approach (i.e. a sunset provision) is consistent with the procedural framework of the Occupational Safety and Health Act, which directs the Secretary to use specified procedures to amend or revoke a standard adopted under the Act. These procedures include public notice and an opportunity for the public to file comments and objections and to request a public hearing on the proposed amendments or revocation (29 U.S.C. 655).
It is, of course, possible that after the process safety management rule has been in effect for a while, however, facts may emerge to indicate that there is a need to change the regulation (e.g., safety prevention provisions, highly hazardous chemical lists, etc.). If such facts emerge, either based on safety experience under the rule or on an OSHA retrospective study of the costs and benefits of the rule, the Agency might then consider amending the regulation to make it more effective. This would, of course, be done under section 6 of the Occupational Safety and Health Act, perhaps with the assistance of other potentially relevant statutes such as the Alternative Dispute Resolution Act (P.L. 101-552) and Negotiated Rulemaking Act (P.L.101-648). Under any of these vehicles, however, interested persons would be given a chance to comment and present evidence on all relevant issues, a safeguard that might be missing if a sunset provision were used.
Purpose.
It was pointed out to OSHA by several commenters (e.g., 3: 12, 48, 53) that in the proposed paragraph concerning the purpose of the standard (proposal paragraph (a)), OSHA did not correctly state the types of chemicals covered by the proposal since in addition to "toxic, flammable or explosive chemicals," OSHA was also covering reactive chemicals. This intent was stated in other locations in the proposal including the description of the highly hazardous chemicals covered by Appendix A of the proposal. In response, OSHA has added "reactive" to the purpose paragraph and it now states that the section contains requirements for preventing or minimizing the consequences of "toxic, reactive, flammable, or explosive chemicals." Additionally, OSHA has added that the standard is intended to address the hazards to employees from toxicity, fire or explosion.
Application: Paragraph (a).
The application section in proposed paragraph (b), specified those types of highly hazardous chemicals covered by the proposal. The application section also included processes involving certain specified highly hazardous chemicals at or above a stated threshold which was listed in Appendix A; processes involving flammable liquids or gases on site in one location in quantities of 10,000 pounds or greater (with two exceptions discussed later in this preamble); the manufacture of explosives and pyrotechnics; and processes involving chemicals developed after the promulgation of the final standard which meet certain criteria contained in proposed mandatory Appendix B (Substance Hazard Index). Additionally, OSHA proposed to exclude retail facilities, oil and gas well drilling and servicing operations and normally unmanned remote facilities from the standard.
The application paragraph was addressed by the vast majority of rulemaking participants. OSHA received a great deal of support concerning its general approach to covering highly hazardous chemicals but also received numerous recommendations for clarifications; criticisms regarding the toxic and reactive list (Appendix A); the inclusion of 10,000 pounds of flammable liquids rather than the use of a vaporizable amount (5 tons of vapor); and recommendations for additional exemptions for certain processes or industries. OSHA has carefully evaluated participants' comments and information concerning the appropriate scope and application of the standard in order to assure that the standard is clearly and properly focused to achieve its goal of eliminating the occurrence of releases or mitigating the consequences of releases that occur.
Before discussing the proposed application provisions in detail, OSHA would like to address and clarify OSHA's use of the plural word processes in the application paragraph of the proposal. This use resulted in commenters (e.g., Ex. 3: 104, 109, 112, 119, 125, 126) questioning whether the use of the word "processes" meant that the amount of highly hazardous chemical used at a plant must be aggregated to meet the threshold for coverage even though the amount of highly hazardous chemicals used at any one location might be less than the threshold amount or the amount of highly hazardous chemical in use might be divided among remote processes. Also, participants asked whether the proposal required that the highly hazardous chemical threshold quantity be aggregated over a period of time or whether it must be present at one point in time to be covered by the proposal. OSHA addressed this concern in its November 1, 1990, FEDERAL REGISTER notice in Issue 2 (55 FR 46075).
OSHA's view at that time was that if a plant exceeded the threshold quantity of a listed chemical but the chemical was used in smaller quantities around the plant and was not concentrated in one process or in one area, then OSHA believed that a catastrophic release of the threshold quantity would be remote due to the reduced availability of a concentrated amount of the chemical in one location. However, OSHA requested comment on the point at which a chemical should be considered in its aggregate due to the proximity of the sites at which it was being used in a plant.
While a few participants indicated that the amounts of a highly hazardous chemical used at various sites around the plant should all be counted toward the threshold amount for coverage (e.g., Ex. 3: 12, 18, 41; Ex. 153), most participants who discussed this issue noted that the threshold quantity should not be aggregated (e.g., Ex. 163; Ex. 164; Tr. 2591, 3192). They agreed that highly hazardous chemicals in less than threshold quantities distributed in several processes would not present as great a risk of catastrophe as the threshold quantity in a single process.
OSHA continues to believe that the potential hazard of a catastrophic release exists when the highly hazardous chemical is concentrated in a process and therefore agrees with these commenters. OSHA has clarified the language contained in the application paragraph to reflect its intent that coverage is triggered by a specified threshold quantity of an Appendix A substance being used in a single process. This revision also clarifies the fact that the presence of a threshold quantity of a highly hazardous chemical in a process is to be at one point in time; not aggregated over a period of time.
In the application section (paragraph (b)(1)(i)) of the proposal, a process would be covered if it involved a toxic or reactive highly hazardous chemical listed in Appendix A, at or above a specified threshold quantity. Appendix A was a compilation of highly hazardous chemicals that could cause a serious chemical accident, by toxicity or reactivity, and a consequent potential danger to employees in a workplace.
The Appendix A list has been drawn from a variety of relevant sources which include: the New Jersey "Toxic Catastrophe Prevention Act," the State of Delaware's "Extremely Hazardous Substances Risk Management Act," the World Bank's "Manual of Industrial Hazard Assessment Techniques," the Environmental Protection Agency's "Extremely Hazardous Substance List," the European Communities Directive on major accident hazards of certain industrial activities (82/501/EEC, sometimes called the Seveso Directive), the United Kingdom's "A Guide to the Control of Industrial Major Accident Hazards Regulations 1984," the American Petroleum Institute's RP 750, "Management of Process Hazards," the National Fire Protection Association's NFPA 49, "Hazardous Chemicals Data," and the Organization Resources Counselors, Inc.'s "Recommendations for Process Hazards Management of Substances with Catastrophic Potential."
Every chemical listed in Appendix A is on at least one list compiled by these agencies and organizations as warranting a high degree of management control due to its extremely hazardous nature. Most of the chemicals are on several lists. Not every list contains the same chemicals or quantities. Based on a review of these sources, OSHA has sought to include those toxic and reactive chemicals it believes are most significant in potentially becoming a catastrophic event. OSHA has also sought to develop a reasonable listing of threshold quantities which, when used in a process, would invoke coverage of the standard.
Those Appendix A highly hazardous chemicals which are highly reactive or explosive-type chemicals have been drawn from chemicals listed in the National Fire Protection Association (NFPA) document, NFPA 49, "Hazardous Chemicals Data" and cross-referenced with other sources mentioned above. The Agency decided to include substances with the two highest or most dangerous reactivity ratings from NFPA 49 because these chemicals present the most severe exposure potential to workers. These substances, which are rated 3 or 4 by NFPA 49, are those which are capable of undergoing detonation or explosive decomposition. These are the substances which can generate the most severe blast or shock wave, and can cause fragmentation of piping, vessels and containers, as well as causing serious damage to buildings and structures.
The minimum threshold quantities for the highly reactive chemicals covered by the standard have been determined by calculating the amount of material needed to propagate a blast wave that creates an overpressure of 2.3 psi (15.85 kPa) to a flat surface perpendicular to the direction of the blast wave at a distance of 100 meters from the point of origin. This approach is similar to that used by the State of Delaware.
The toxic chemicals contained in Appendix A were drawn from the various resource documents discussed above. Most of the toxic chemicals listed in Appendix A are on a majority of the lists produced by these resource documents.
In determining threshold quantities for toxic chemicals, OSHA used the Turner described Gaussian dispersion model. This approach, again, is similar to that used by the State of Delaware. Both OSHA and Delaware made the following assumptions: average conditions of 4.3 m/sec. wind speed and D stability with urban dispersion coefficients; continuous steady-state release for one hour; no liquid pools; all released chemicals in vapor or gaseous state; chemical release is at ambient temperature and at ground level; chemical gas or vapor cloud is neutrally buoyant; and no design features prevent downwind dispersion. The calculated threshold quantities were rounded by OSHA to further simplify the standard.
The lowest threshold quantity that the Agency has used is 100 pounds (45.4 kg) for the most hazardous of the chemicals listed. The OSHA threshold quantities are the same or somewhat greater than the Delaware "sufficient quantity level" (threshold quantity) due to the rounding up by the Agency for the vast majority of the toxic chemicals listed. This has been done to simplify the application of this final rule and also in recognition that the Agency has other standards which address the hazards of lower quantities of toxic materials in the workplace.
OSHA specifically solicited comments on the sufficiency of the list and threshold quantities in Appendix A (55 FR at 29158). Appendix A generated a significant amount of discussion during this rulemaking.
Some commenters (e.g., Ex. 3: 18, 35, 89, 152) asked why OSHA's resulting list was different than the Environmental Protection Agency's (EPA) Extremely Hazardous Substance (EHS) list and some suggested further expansion of the list. For example the Consumer Policy Institute (Ex. 3: 152, p.2) stated:
CPI recommends that the highly hazardous substance list be expanded to include all substances on the EPA SARA TITLE: III list of extremely hazardous substances, all substances found to be involved in incidents at facilities and all substances listed by the European Economic Community under the Seveso directive.
The Shipbuilders Council of America (3: 18, p.4) indicated:
[I]t is recommended that the two agencies [OSHA and EPA] publish one consistent list of chemicals which both would consider "extremely" or "highly" hazardous. Employers would then be required to deal with one list of chemicals for reporting purposes under SARA regulations and for safely managing processes that use these chemicals under the OSHA regulations.
Under section 302 of the Superfund Amendments and Reauthorization Act (SARA) also known as the Emergency Planning and Community Right-to-Know Act (42 U.S.C. 11001 et seq.), EPA was required to publish a list of extremely hazardous substances with threshold planning quantities which would trigger planning in states and local communities (52 FR 13378). EPA's EHS list is quite extensive (more than 300 hazardous substances) and serves as an emergency response planning list directed toward addressing hazards to the public and the environment.
Section 304 of the Clean Air Act Amendments (CAAA), paragraph (b), List of Highly Hazardous Chemicals, mandates that:
The Secretary [of Labor] shall include as part of such standard [Chemical Process Safety Standard] a list of highly hazardous chemicals, which include toxic, flammable, highly reactive and explosive substances (Emphasis added).
The paragraph further indicates that the Secretary may include those chemicals listed by the Environmental Protection Agency under section 302 of the Emergency Planning and Community Right to Know Act of 1986.
Further the CAAA did not anticipate that even EPA would adopt the whole EHS list for the purpose of prevention of accidental chemical releases. Section 301(r) indicated that EPA's first list must contain no less than 100 substances which may be from the EHS list. EPA's 301(r) list is not a planning tool but rather a list that requires covered plants to develop comprehensive Risk Management Plans.
While OSHA considered this list, it does not consider all of the substances on the EHS list to present a potential catastrophic situation for employees in workplaces within its jurisdiction. Therefore, OSHA believes it has acted reasonably and appropriately in evaluating a variety of chemical lists including the EHS list in order to identify those highly hazardous chemicals which present a potential catastrophic threat to employees. These events typically include toxic releases, fires and explosions as opposed to potential environmental threats such as spillage of a pesticide.
Several participants in the rulemaking (e.g., Ex. 3: 6, 45, 51, 150; Ex. 141) advised OSHA that certain chemicals which appeared in Appendix A, including dimethyl sulfide, isopropyl formate, and methyl disulfide had been deleted from EPA's EHS list based on a reconsideration of the data and a determination that the data did not support the inclusion of the chemicals on the EHS list. OSHA agrees that it is appropriate to delete these chemicals from its list since a redetermination had been made that data and information available did not support their inclusion on the EPA list. OSHA has therefore removed these chemicals from its Appendix. Other changes to OSHA's Appendix A list include: (1) a change in the amount of anhydrous ammonia from 5,000 to 10,000 pounds to better reflect its hazards; (2) a change in the stated threshold quantity of ammonia solutions from 10,000 to 15,000 pounds to better reflect its dilution by water and its consequent decreased flammability and potential adverse health effects; (3) a change in the amount of 3-bromopropyne (also listed as propargyl bromide) from 7,500 pounds to 100 pounds to reflect its toxic characteristics rather than its reactive characteristics; (4) elimination of the erroneous description of formaldehyde, in "concentrations greater than 90%," since no such concentration exists, and the addition of formalin in the description to assure that no doubt exists that formalin is covered under the formaldehyde entry; (5) an editorial change to peracetic acid (also called peroxyacetic acid) which inadvertently did not include the description "concentration greater than 60%" which was correctly included in the subsequent entry of peroxyacetic acid; (6) the elimination of the word "liquid" from the description of sulfur dioxide since it may also be a gas and the health hazards are the same regardless of its state; (7) and changes based on a reevaluation of available information, in the threshold amounts of allylamine from 1500 pounds to 1000 pounds, peracetic acid (also called peroxyacetic acid (concentration greater than 60%) from 5000 pounds to 1000 pounds, and tetramethyl lead from 7500 pounds to 1000 pounds to better reflect their toxic hazards.
Some participants expressed their general support for the list contained in Appendix A (e.g., Ex. 3: 17, 45, 59, 62, 82, 88, 95, 127, 134; Tr. 1999-2000). Allied-Signal Inc. (Ex. 3: 17, p.15) observed:
Appendix A is a credible compilation of chemicals that are sufficiently toxic and volatile that their release could result in a catastrophic event. We applaud OSHA's use of list of toxic and reactive/unstable chemicals developed by other Federal and State agencies to develop Appendix A.
The American Paper Institute (Ex. 3: 45, p.10) indicated:
The approach of tying process safety management requirements to the presence or absence of listed chemicals is an imperfect one. While the list-based approach may mean that the rule is both over and under inclusive, we have devised no approach that more closely tailors the process safety management requirements to real process safety hazards.
In general, Appendix A appears to be a sufficient compilation of chemicals.
BP America Inc. (Ex. 3: 59A) noted:
BP America has reviewed the list of Appendix A chemicals and believes that the current compilation of chemicals is acceptable.
Amoco Corporation (Ex. 3: 95) stated:
We think that the list of highly hazardous chemicals in Appendix A is sufficiently comprehensive in nature and reasonable with regard to threshold quantity to adequately cover the most toxic and hazardous chemicals in current use.
American Cyanamid Company (Ex. 3: 127, p.2) indicated:
Mandatory Appendix A is a sufficient compilation of chemicals for the initial coverage of this proposed standard. We could find no major omissions from Appendix A. Its completeness is undoubtedly attributable to careful research on OSHA's part and the experience factor derived from review of similar lists * * *.
Lubrizol Petroleum Chemicals Company (Ex. 3: 134) stated:
The Houston plants agree with OSHA's belief that Appendix A represents a reasonable and appropriate listing of chemicals and threshold quantities.
Finally, OSHA's expert witness, who worked for 37 years with Monsanto Company, the last 9 as corporate safety director (worldwide responsibilities) (Tr. 1999-2000) testified:
In my opinion, the list of chemicals with the stated threshold quantities in the appendix is reasonable and provides the focus for preventing catastrophic releases of hazardous materials in the processing industry.
OSHA based its list on information drawn from a variety of sources, including other federal and state agencies, national consensus standards and the United Kingdom Health and Safety Commission.
While any listing of hazardous chemicals is subject to revision, I support the listing of the chemicals in the appendix as appropriate.
It encompasses, in my experience, the vast majority of chemicals likely to cause catastrophic release and its consequences.
However, a number of participants felt OSHA should provide a technical basis for the Appendix A list and its threshold quantities (e.g., Ex. 3: 26, 46, 48, 53, 97, 101, 129; Ex. 131; Tr. 66, 1015). Some participants noted that if no published technical basis existed then it would be difficult to add chemicals at a later time (e.g., Ex. 3: 46, 48; Ex. 131; Tr. 1016). OSHA believes that its review of available literature for the development of its list of highly hazardous chemicals and its technical approach (discussed previously) is an appropriate method to determine which toxic chemicals should be included on its list. OSHA also believes that it is reasonable to defer to groups that have already published their lists and which have withstood public scrutiny. OSHA is convinced that it has taken a correct and reasonable approach.
Additionally OSHA believes that additional consideration would be required to fully evaluate a "technical basis" other than that used by the Agency (e.g., a formula). The Organization Resources Counselors (ORC) recommended the use of a technical basis throughout the rulemaking. In its post-hearing comment (Ex. 131, Table A-1), ORC reassessed the OSHA Appendix A list based on its suggested technical basis (a formula, similar to the Substance Hazard Index proposed by OSHA). The outcome resulted in significant differences in the threshold quantities for many chemicals. For example, OSHA lists the threshold quantity of acrylyl chloride at 250 pounds and arsine at 100 pounds; ORC lists the threshold quantity of acrylyl chloride at 200 pounds and arsine at 450 pounds. While the ORC approach is an interesting one, OSHA believes that its approach is also correct, and has decided to retain it in the final rule.
As noted, some participants indicated that without a technical basis for Appendix A it would be difficult for OSHA to readily update its list in the future. OSHA believes that a means for adding highly hazardous chemicals to Appendix A in the future can be considered at such time as the need arises. As discussed, OSHA has explained its technical basis for Appendix A highly hazardous chemicals. OSHA does not believe that it should modify the approach it used in the development of the Appendix A list especially in light of the many changes that would be necessitated through the incorporation of other suggested approaches. In addition, with the exception of a few corrections and clarifications, there were no objections raised as to the appropriateness of the threshold quantities proposed, but as stated, general support for the list and threshold quantities.
As discussed, the application section (proposed paragraph (b)(1)(i)) triggering coverage of those processes using chemicals in quantities listed in Appendix A, has been clarified to lessen confusion concerning the aggregation of chemicals by changing the term "processes" to "a process." No other changes have been made to the text of the paragraph but it has been redesignated as paragraph (a) and thus becomes paragraph (a)(1)(i).
The application section (paragraph (b)(1)(ii)) proposed to include processes involving flammable liquids or gases in quantities of 10,000 pounds or more. It had been suggested that OSHA cover flammable gases and liquids with a potential release of five tons of gas or vapor (Ex. 2: 10, 11).
The American Petroleum Institute's (API) Recommended Practice 750 (RP 750), Management of Process Hazards, uses the potential release of gas or vapor approach. The stated purpose of RP 750 is to help prevent the occurrence, or minimize the consequences of, catastrophic releases of toxic or explosive materials (Ex. 2: 11). Additionally in the application statement of RP 750 it is stated that the recommended practice is intended for facilities that use, produce, process, or store:
Flammable or explosive substances that are present in such quantity and condition that a sudden, catastrophic release of more than 5 tons of gas or vapor can occur over a matter of minutes, based on credible failure scenarios and the properties of the materials involved.
Appendices A and B to RP 750 provide information and guidance on the application of this paragraph.
However, OSHA believed that assessing the variables and assumptions inherent in determining whether five tons of gas or vapor could be released (temperature, pressure, rate of release, etc.) using undefined "credible release scenarios," would be an unnecessary burden on employers and compliance personnel. More importantly, depending on these variables, substances might sometimes be covered and sometimes not be covered, a potentially confusing situation. Therefore, OSHA decided to use a worst case approach and assume that the entire five ton quantity of a highly hazardous chemical could be released into gas or vapor.
In Issue 1 in the notice of proposed rulemaking (55 FR at 29158) OSHA requested comments on other ways in which flammable liquids and gases might be covered. A variety of commenters supported the 10,000 pound threshold amount for coverage of flammable liquids and gases which OSHA proposed (e.g., Ex. 3: 45, 59, 81, 95, 99). BP America (Ex. 3: 59A) remarked:
BP America also believes that a five ton release of vapor as explained in the API Recommend Practice (RP) 750 is most appropriate. However, BP understands the administrative difficulties relating to enforcement of this provision and, therefore, supports the five ton flammable liquids and gases criterion as defined in the standard.
Goodyear Tire & Rubber Company (Ex. 3: 81) noted:
The threshold quantity of 10,000 pounds for flammable liquids and gases is appropriate for the standard.
Other participants (e.g., Ex. 3: 20, 26, 69, 71, 80, 91, 106, 108, 127, 129, 173; Tr. 1513, 2583, 3193) recommended that OSHA address only the amount of flammable liquid or gas that could result in the release of 5 tons of vapor using worst case release conditions in conjunction with appropriate flash calculations instead of credible release scenarios. For example, API (Ex. 3: 106A, p.4) asserted:
As you know, API's Recommended Practice 750 applies to flammable liquids provided 10,000 pounds (5 tons) of gas or vapor can be released over a matter of minutes during credible release scenarios. We understand OSHA has rejected this approach * * * due to regulatory difficulties in defining credible release scenarios. Although API prefers the API RP 750 approach, we can accept the 10,000 pounds of inventory criteria as being simpler. However, API remains convinced that only the vaporizable portion of the flammable liquid should be included in the inventory.
Our concern stems from the fact that oil and gas operations handle complex substances which often will invalidate the appropriateness of the 10,000-pounds-of-inventory approach. For example, a release of 10,000 pounds of crude oil constitutes only a small fraction of the hazards of a release of 10,000 pounds of the C2-C6 hydrocarbon series. This is because only a small part of a crude oil release will immediately vaporize, and it is only the vaporizable portion that could potentially constitute a catastrophic hazard.
For these reasons, we propose * * * "Processes which involve flammable liquids or gases (as defined in 1910.1200(c) of this part) onsite in one location, in quantities that will vaporize 10,000 pounds or more under worst-case release conditions * * *."
While this approach requires a routine flash calculation, it does remove the judgement regarding credible release scenarios that is currently provided by the RP-750 approach.
However, OSHA believes that the modified API recommendation calls for the use of yet another judgement by its use of the undefined "worst case release conditions." Further, OSHA believes that RP 750 does not directly address the hazards to employees of fires which might occur rather than explosions. For example, in Appendix A of RP 750, the general discussion on the probability of ignition and explosion of vapor clouds (Ex. 2: 11, p.11) reads:
When a hydrocarbon vapor cloud forms, the cloud may dissipate harmlessly, be consumed by a flash fire without causing significant blast overpressures, or explode * * *.
Although vapor cloud explosions have occurred after release as small as 1 ton, most of these explosions have occurred as a result of release of more than 5 tons * * *.
OSHA's proposed process safety management standard was directed toward the hazards of fires as well as the hazards of explosions.
For these reasons, OSHA continues to believe that the use of a 10,000 pound threshold for flammable liquids or gases is a reasonable approach and the provision has been retained in the final standard. This final provision becomes paragraph (a)(1)(ii).
In the proposed application section (paragraph (b)(1)(ii)(A)) OSHA proposed to exempt from coverage hydrocarbon fuels used solely for workplace consumption as a fuel (e.g., propane or oil used for comfort heating). OSHA believed that this type of use did not have the same catastrophic potential as those which were proposed. The exemption would exclude fuels used in general heating systems and refueling systems (for fleets) throughout the country. Such uses would still be regulated by other existing specific OSHA standards (such as 1910.106, flammable and combustible liquids, and 1910.110, liquefied petroleum gases) which adequately address these uncomplicated uses.
Additionally, in Issue 3 of the hearing notice (55 FR at 46075) OSHA indicated that some confusion existed regarding this proposed exemption. For example, some participants asked if this exemption included furnaces used in a process. Therefore OSHA solicited comments on this issue. Organization Resources Counselors (ORC, Ex. 131, p.3-4) commented:
A number of persons testifying during the public hearings indicated concern and confusion over the wording of the proposed exemption for hydrocarbon fuels that are present in quantities greater than 10,000 pounds, but are not part of a process. Examples of these would be propane or oil used for comfort heating and gasoline or diesel fuel for use in industrial vehicles. To remedy this confusion, ORC recommends that subparagraph (b)(1)(ii)(A) be amended to read:
Hydrocarbon fuels used solely as a fuel at a facility which is not otherwise covered by this rule.
This change will ensure that facilities which use hydrocarbon fuels in a processing step are not excluded from coverage under the standard, but that this subparagraph of the final rule properly continues to exclude facilities at which processing aberrations are absent * * *.
Further the American Petroleum Institute (Ex. 137, p.12-13) observed:
It is our understanding that OSHA's intention in providing exemption (b)(1)(ii)(A) was to exclude the enormous number of small business locations across the nation which would not be covered by the proposed rule, except for their on-site storage of hydrocarbon fuels for low-risk applications such as heating, drying, and the like. Such activities are not the subject of this rule, and this exclusion is entirely appropriate.
On the other hand, interpreting this exclusion to apply to hydrocarbon fuels used for process-related applications such as furnaces, process heaters, and the like at facilities covered by the rule was not intended.
OSHA agrees with these participants and has changed the final provision to clarify its intent not to exclude from coverage hydrocarbon fuels used for process related applications such as furnaces, heat exchangers and the like at facilities covered by this rule. It becomes final paragraph (a)(1)(ii)(A) and exempts from coverage:
Hydrocarbon fuels used solely for workplace consumption as a fuel (e.g., propane used for comfort heating or gasoline used for vehicle fueling), if such fuels are not a part of a process containing another highly hazardous chemical covered by this standard.
The second proposed exemption concerned flammable liquids stored or transferred which are kept below their atmospheric boiling point without benefit of chilling or refrigeration and was proposed paragraph (b)(1)(ii)(B). Again, OSHA did not believe that the flammable liquids as described in the exemption have the same potential for a catastrophe as those proposed. Again an OSHA standard already regulates the treatment of the exempted flammable liquids (1910.106, flammable and combustible liquids).
While many participants supported the exemption concerning flammable liquids stored or transferred which are kept below their atmospheric boiling point without benefit of chilling or refrigeration, they recommended that OSHA clarify the exemption (e.g., Ex. 3: 48, 71, 106, 108, 119, 120; Ex. 93; Ex. 119; Tr. 2012) by using established language from its standard concerning flammable and combustible liquids. For example, the American Petroleum Institute (Ex. 3: 106A, p.4-5) concluded:
OSHA's phrase "atmospheric boiling point" introduces unnecessary problems in applying this important exemption to various complex substances such as crude oil which do not have precise boiling points. OSHA has previously resolved this problem by providing definitions for "atmospheric tank" and "boiling point" in Subpart H - 1910.106(a)(2) and (a)(5).
OSHA agrees with this suggestion concerning the use of existing definitions; this does not change the intent of the exemption and merely clarifies the exemption. Therefore, proposed paragraph (b)(1)(ii)(B) becomes final paragraph (a)(1)(ii)(B) and has been clarified by adding existing language from OSHA's standard for flammable and combustible liquids, 1910.106, "atmospheric tank" and "boiling point," and providing a definition for these terms in lieu of the proposal's term "atmospheric boiling point." OSHA believes that this exemption is reasonable and appropriate.
In the proposal paragraph (b)(1)(iii) proposed to cover the manufacture of explosives as defined in paragraph (a)(3) of 1910.109, "Explosives and blasting agents." Additionally, proposed paragraph (b)(1)(iv) covered the manufacture of pyrotechnics (as defined in paragraph (a)(10) of 1910.109), including fireworks and flares.
Although there is an existing OSHA standard for explosives and pyrotechnics (1910.109), that standard does not address the hazards associated with their manufacture. OSHA believed that the requirements contained in the proposed process safety management standard should be applied to the explosive and pyrotechnic manufacturing process because of their potential for producing a major accident during manufacture. Therefore the proposal addressed a gap that exists in the Agency's current standard for explosives and pyrotechnics.
Some rulemaking participants (e.g., Ex. 3: 40, 52, 60; Tr. 3011-21) asserted that the manufacture of explosives and pyrotechnics should not be covered by proposed 1910.119, because the hazards associated with these substances are already adequately covered by 1910.109 of the OSHA standards, as well as requirements of other regulatory agencies. For example, a commenter from the Society of Explosives Engineers (S.E.E, Ex. 3: 40, p.1-2) stated:
Because explosives are currently regulated by so many Federal, state, and local agencies, it is highly questionable that they could result in a catastrophic event typical of those described by OSHA in the background discussion.
S.E.E. believes that uniform, workable regulations are a key factor in the promotion and maintenance of explosive safety. We further believe that the use, storage, handling and transportation of explosives are already adequately covered by regulations in 29 CFR (OSHA), 30 CFR (MSHA and OSM), 49 CFR (DOT) and the regulations of state and local regulatory agencies and there is no need for OSHA to include the manufacture of explosives in 29 CFR 1910.119.
With respect to the manufacture of fireworks, a hearing participant from the American Pyrotechnics Association (APA, Tr. 3011) testified:
The APA endorses the concept of federal standards designed to adequately prevent or minimize the consequences of chemical accidents involving highly-hazardous chemicals. However, the APA believes that the statements cited by the Agency are incorrect.
The inclusion of fireworks manufacturing processes is unwarranted and could be interpreted to require protective measures which could impose substantial burdens on the fireworks industry without making a significant contribution toward work place safety.
In its comment (Ex. 3: 52), the APA further asserted that a gap does not exist in the OSHA standards with respect to the manufacture of fireworks. APA stated that the Bureau of Alcohol, Tobacco and Firearms (BATF) currently regulates the quantity of explosive and pyrotechnic materials which may be used at one time, and the distances between process and storage buildings. The APA contended that the BATF requirements and the requirements contained in 1910.109 of the OSHA standards, together with OSHA enforcement of provisions contained in the National Fire Protection Association (NFPA) standard, "Manufacture, Transportation, and Storage of Fireworks" (NFPA-1124), adequately regulates the manufacture of fireworks.
Other rulemaking participants, however, strongly supported the inclusion of the manufacture of explosives and pyrotechnics within the scope of this proposed standard, and objected to excluding these activities. For example, a commenter from the Oil, Chemical & Atomic Workers (OCAW, Ex. 114, p.1-2) said:
[A]s far as the inclusion of the explosives industry in the standard coverage, OCAW feels there is no room for debate. These industries are no different from the industries that fall within the scope of the proposed 1910.119. Further, the fact that there is already an explosives standard 1910.109 does not justify their exclusion from 1910.119 as 1910.109 does not address process safety in any manner.
OCAW buttressed their position (Ex. 114) concerning the inclusion of explosives manufacturing within the scope of this proposed standard by elaborating on the similarity of the explosives industry to other chemical industries that are proposed to be covered by 1910.119.
In its post-hearing comment, the United Steelworkers of America (USWA, Ex. 118) asserted:
In the proposed Process Safety Management of Highly Hazardous Chemicals standard, paragraphs (b)(1)(iii) and (iv) proposed to include the manufacture of explosives and pyrotechnics. The United Steelworkers of America supports this inclusion. It is unthinkable that OSHA would even consider to exempt this industry, given the products that it manufactures and its accident history. How anyone could argue that the strategies for effective process safety management outlined in the proposed standard could not, or would not, enhance the overall safety of this industry and aid in the prevention and mitigation of major accidents is beyond reason.
Also in their comment, USWA described several incidents that occurred in the explosives industry, and with respect to one particular plant (Ex. 118, p.2), remarked:
In the past 50 years, 60 workers lost their lives at the plant. Of the six major accidents at the facility, not inclusive of the most recent incident, five of these were directly related to process safety hazards that are not covered by 1910.109 or any other existing OSHA standard. Even though OSHA was able to cite the company for specific violations of existing standards, it has been repeatedly forced to rely on the general duty clause to address major concerns because of the absence of a process safety management standard.
One rulemaking participant (Ex. 3: 23) disagreed that 1910.119 should apply to the manufacture of explosives and pyrotechnics and suggested, instead, that 1910.109 be revised to include safety provisions for these manufacturing activities. Other rulemaking participants (e.g., Ex. 3: 62, 100, 116) believed that proposed 1910.119 provided a technically sound, realistic methodology to improve explosive manufacture safety. They suggested, however, that the provisions of 1910.119 be incorporated into 1910.109 of the OSHA standards, so that all requirements pertaining to explosives will be contained in one standard.
For example, a hearing participant from the Institute of Makers of Explosives (IME, Tr. 1244) testified:
IME supports OSHA's proposed regulation for process safety management as a technically sound, logical, and realistic way to offer a methodology to improve explosive manufacture safety. However, IME recommends that OSHA delete the manufacture of explosives from Section 1910.119(b)(1)(iii) and incorporate these safety regulations for the manufacture of explosives into 29 CFR 1910.109 Explosives and Blasting Agents at (b)(2).
It was contended (Ex. 130) that this approach would continue OSHA's 20-year history of maintaining a vertical regulation for commercial explosives; eliminate the alleged ambiguity that exists in the proposed rulemaking by including the manufacture of explosives in the application of the standard; and, would recognize the unique conditions under which explosives are manufactured.
In subsequent post-hearing comments, however, both Hercules and the IME (Ex. 125; Ex. 130) submitted draft regulations for the manufacture of commercial explosives. They suggested that the manufacture of commercial explosives be removed from the scope of 1910.119, and that these draft regulations be included in a revision to 1910.109 as an appropriate code to regulate the manufacture of commercial explosives.
OSHA appreciates the time and effort involved in developing these draft regulations, and believes that they constitute an excellent source document that the Agency can utilize when it revises the standards contained in 1910.109. However, OSHA will not incorporate these draft regulations into 1910.109 as a part of this rulemaking process since they did not receive the type of public comment and evaluation contemplated by section 6(b) of the Occupational Safety and Health Act.
After a thorough analysis of all of the information contained in this rulemaking record, OSHA remains convinced that the hazards associated with the manufacture of explosives and pyrotechnics have the potential of resulting in a catastrophic incident, and pose a significant risk to employees and that the manufacture of explosives and pyrotechnics should be covered by the provisions of the final process safety management rule.
However, the Agency has been persuaded by those participants who suggested that OSHA delete the manufacture of explosives and pyrotechnics from proposed 1910.119, and incorporate the provisions of the process safety management standard into 29 CFR 1910.109, "Explosives and Blasting Agents." This will have the effect of referencing in one place, the specific and significant OSHA requirements pertaining to explosives and blasting agents.
Accordingly, proposed paragraph (b)(1)(iii) has not been retained in the final rule for 1910.119. Rather, 1910.109 has been revised to add a new paragraph, (k)(2), that requires the manufacture of explosives to comply with the provisions contained in 1910.119, process safety management of highly hazardous chemicals.
Similarly, proposed paragraph (b)(1)(iv) has not been retained in the final rule for 1910.119. Again, 1910.109 has been revised to add another new paragraph, (k)(3), that requires the manufacture of pyrotechnics, including fireworks and flares, to comply with the provisions contained in 1910.119, process safety management of highly hazardous chemicals.
During this rulemaking process, some concern was expressed that this standard could be interpreted, inappropriately, to apply to all explosive and pyrotechnic manufacturing operations, even those operations of the manufacturing process where explosives or pyrotechnics are not present (e.g., Ex. 3: 62; Ex. 125; Ex. 130). This is not the intent of OSHA. The Agency wants to make it clear that the provisions contained in this final rule apply to explosives and pyrotechnics manufacturing operations only when such substances or other chemicals covered by the standard or in Appendix A are present.
Finally, in paragraph (b)(1)(v) OSHA proposed a means for assuring that newly developed toxic chemicals which were not listed in Appendix A but were introduced into a process would be evaluated for their degree of hazard and be included in the standard's coverage. A formula, the Substance Hazard Index (SHI), was contained in Appendix B of the proposal. The formula relied on the availability of information concerning a chemical's level of hazard as established by the American Industrial Hygiene Association (AIHA) in its Emergency Response Planning Guidelines (ERPGs). The purpose of the SHI was to establish, using certain data, a relative ranking of toxic chemicals.
OSHA acknowledged in the proposal in Issue 2 (55 FR at 29158) that there might be some shortcomings in the use of the SHI. As noted, an important part of the SHI formula relied on the availability of the AIHA computation of ERPGs for individual chemicals. Only a few ERPGs are presently available.
Generally participants objected (e.g., Ex. 3: 2, 12, 17, 33, 45, 46, 47, 48, 50, 59, 60, 64, 69, 71, 82, 86, 95, 101, 112, 122, 127, 132, 137, 152, 162, 171; Ex. 148; Tr. 968, 1017, 2177, 2654) to using the SHI and cited several reasons for not using it. They observed that OSHA is deferring rulemaking to a private entity; there is no reason to believe that ERPG development can or will be accelerated in order to be responsive to the standard; the 500 pound threshold quantity is arbitrary; and OSHA already has a sound mechanism for adding chemicals to Appendix A, the rulemaking process.
OSHA has been convinced by participants in the rulemaking not to use the SHI formula to add additional toxic chemicals to the Appendix A list at this time. While OSHA believes a formula would be a worthwhile approach to including new toxic chemicals under the standard, it has been persuaded by commenters that it should use section 6(b) rulemaking procedures until such time as a better formula can be developed by OSHA. Therefore this paragraph has been deleted from the final rule and OSHA will either try to develop a better formula or rely on rulemaking on a chemical by chemical basis to add chemicals to Appendix A.
Certain exemptions were contained in the proposed application paragraph of the process safety management rule (paragraphs (b)(2)(i) through (iii)). These exemptions included: retail facilities; oil and gas well drilling and servicing; and normally unmanned remote facilities.
With respect to the exclusion of retail facilities and normally unmanned remote facilities, OSHA believed that such facilities did not present the same degree of hazard to employees as other workplaces covered by the proposal. Therefore OSHA should not require a comprehensive process safety management system in addition to other applicable OSHA standards addressing flammable and combustible liquids, compressed gases, hazard communication, etc., for retail facilities and unmanned remote facilities.
Certainly, highly hazardous chemicals may be present in both types of work operations. However, OSHA believes that chemicals in retail facilities are in small volume packages, containers and allotments, making a large release unlikely. OSHA received few comments disagreeing with the exemption of retail facilities (e.g., gasoline stations). OSHA has retained the exemption in the final rule.
In normally unmanned remote facilities (defined in proposed paragraph (c) and called "normally unoccupied remote facilities" in final paragraph (b)), the likelihood of an uncontrolled release injuring or killing employees is effectively reduced by isolating the process from employees. OSHA believes that the present OSHA standards contained in subpart H, such as 1910.101, compressed gases, and 1910.106 flammable and combustible liquids and in part 1910, subpart Z, toxic and hazardous substances, adequately address the chemical hazards presented in these work operations.
OSHA did receive significant comment supporting the exemption of normally unmanned remote facilities (e.g., Ex. 3: 30, 62, 64, 69, 71, 79, 129). Others suggested that OSHA redefine "normally unmanned remote facility" (e.g., Ex. 26, 32, 39, 69, 80, 82, 106, 108, 129). OSHA has retained the exclusion of normally unmanned remote facilities because the Agency believes such facilities pose a reduced likelihood of releases that could harm employees. The issue of modifying the definition will be discussed in the section concerning definitions.
OSHA also proposed to exclude oil and gas well drilling and servicing operations because OSHA had already undertaken rulemaking with regard to these activities (48 FR 57202). OSHA continues to believe that oil and gas well drilling and servicing operations should be covered in a standard designed to address the uniqueness of that industry. This exclusion is retained in the final standard since OSHA continues to believe that a separate standard dealing with such operations is necessary.
Finally, a number of participants requested special consideration for their processes or exemption from the standard. For example, concern was expressed by participants who conduct batch processing operations (e.g., Ex. 3: 50, 55, 74, 164, 169; Ex. 89; Tr. 972, 3202) regarding their ability to comply with the standard due to the dynamic nature of batch processing. With respect to this, the Synthetic and Organic Chemical Manufacturers Association (SOCMA, Ex. 3: 50, p.6-7) stated:
Batch processes are distinct from continuous operations in that a continuous operation has a constant raw material feed to the process and continual product withdrawal from the process. A batch process has an intermittent introduction of frequently changing raw materials into the process, varying process conditions imposed on the process within the same vessel depending on the product being manufactured. Consequently under the process safety rule as proposed, a batch processor will be required to perform a process hazard analysis each time an order comes in for a chemical that may differ only slightly from the one previously produced.
A batch processing plant is in a constant state of change, always being adapted for different projects. It is not unusual for a batch processor to have a different plant configuration weekly. SOCMA suggests that batch processors be given the flexibility to do a process hazard analysis that is representative of many similar batches. If this recommendation is not adopted, then given the fundamental differences of batch processors, SOCMA recommends that OSHA address batch process safety in a separate rulemaking.
The Ecological and Toxicological Association of the Dyestuffs Manufacturing Industry (Ex. 3: 55) noted:
Based on our near total dependence on batch processing, we support the comments submitted by SOCMA * * *. We also strongly urge OSHA to address batch process safety in a separate rule making given the major differences in operation of continuous and batch processing plants.
However, other participants who have been involved in running both continuous processing and batch processing indicated that the standard for process safety management is appropriate for batch processing (Ex. 128; Tr. 1031, 1936). The Chemical Manufacturers Association (CMA, Ex. 128, p.7-8) stated:
CMA does not believe that facility owners/operators with batch processes should be exempted from complying with the proposed PSM standard * * *. The key question is whether the hazardous material is present in an amount at or above the threshold quantity. If the answer to this question is yes, then the provisions of the proposed standard should apply. CMA companies have extensive experience handling listed materials both in batch and continuous facilities. CMA supports applying the provisions of the proposed standard to any facility (batch or continuous) where the threshold quantities are exceeded.
OSHA agrees that the key question for coverage is whether the highly hazardous chemical is present in an amount at or above the threshold. However, OSHA acknowledges the concern of SOCMA regarding the potential difficulty of conducting a separate process hazard analysis for each variation of a batch process. OSHA has accepted SOCMA's suggestion concerning the development of a generic process hazard analysis which is representative of similar batches. Accordingly, OSHA has included information in Appendix C on conducting process hazards analyses for batch operations.
Some participants felt that their use of a particular highly hazardous chemical should not be covered in the process safety management standard since they observed that their type of process had not been included in the events described in the proposal; they did not feel their processes could create a catastrophic event; and that the broad definition of process used by OSHA captured industries which did not really process chemicals in the same manner chemical plants and refineries do. These participants address, for example, ammonia refrigeration (Ex. 3: 162, 168); steelmaking (Ex. 3: 161, 172); research and development facilities including pilot plants (Ex. 3: 56, 69; Tr. 662); bulk liquid terminals (Ex. 3: 8, 11, 16A, 37); and chlorination facilities (Ex. 90).
First, the catastrophic events described in the notice of proposed rulemaking were simply examples of what could happen upon the release of a highly hazardous chemical and in no way reflect all incidents which have occurred or which have the potential to occur. The National Wildlife Federation (Ex. 3: 86, p.3) observed:
The Acute Hazardous Events (AHE) Database, put together by EPA, catalogued 11,048 events spanning 8 years. In other words, this partial listing of the chemical incidents in the U.S. provides a record of nearly 4 accidents every day.
Second, OSHA has developed what it considers to be a reasonable and appropriate coverage of processes involving highly hazardous chemicals and further believes that those chemicals in their threshold amounts have the potential for a catastrophic release. OSHA believes its listing of highly hazardous chemicals fully meets the intent of the Clean Air Act Amendments (CAAA) which require OSHA to promulgate "a chemical process safety standard designed to protect employees from hazards associated with accidental release of highly hazardous chemicals in the workplace" and which require the standard include a "list of highly hazardous chemicals which includes toxic, flammable, highly reactive and explosives substances."
Third, as the Chemical Manufacturers Association succinctly observed, and with which OSHA concurs, the key question should be whether the highly hazardous chemical is present at or above the threshold quantity. Further, the United Steelworkers of America (Ex. 118, p.4) stated:
In the opinion of the USWA, there is no need to write a specific exemption for any industry. Section (b)(1) already limits the standard to those processes which involve a highly hazardous chemical in sufficient quantities to cause a major accident. If a particular plant does not contain such a process, it will not be covered. If it does contain a hazardous process, it should be covered. There is no legitimate need for any further exemption * * *.
OSHA agrees with this rationale.
Finally, many participants (e.g., Ex. 3: 39, 41, 51, 69, 96, 106, 150, 173; Ex. 91; Ex. 93; Ex. 127; Tr. 1532, 1818, 2579) addressed their belief that gas processing should be excluded from the coverage of the process safety management standard. For example, the Gas Processors Association (Ex. 3: 28A, 1-3) stated:
75% * * * of GPA member companies are small-to-medium sized independent, non-integrated producers and processors of natural gas * * * GPA suggests that a policy similar to those found in certain plans developed for other government agencies could be utilized. In this approach small, remote, low risk facilities which qualify should be part of a two-tier concept in which the operator would develop and have available locally a plan describing efforts toward process safety management in lieu of full process hazard management. In the event of a major release or failure to maintain pre-defined accident experience standards, the local plan would be submitted automatically to OSHA for review and action. OSHA could require revision of the plan or mandate full compliance with Part 1910.119.
The American Gas Association (Ex. 3: 51, p.2) observed:
OSHA's broad proposal could apply to natural gas and liquefied natural gas (LNG) facilities used in the distribution, transmission and storage of gas, except for those facilities that are "unmanned remote facilities."
AGA further observed (p.3) that the standard is overly broad and that it is inappropriate because OSHA is preempted and there are major differences in processes and risk of chemical explosions or accidents at natural gas and LNG facilities as compared with chemical plants and refineries.
The American Petroleum Institute (API, Ex. 3: 106A, p.2) remarked:
API is concerned that OSHA's proposal to include all flammable liquids and gases * * * will result in the application * * * to an enormous number of relatively low hazard facilities, such as natural gas handling facilities, diluting industry's overall ability to comply with this important rule.
API urges OSHA to exclude certain natural gas handling facilities * * * Our rationale is as follows:
High methane natural gas has a density less than that of air, which aids in dispersion * * * has low reactivity and low burning speed * * * flame speeds in natural gas clouds are far below those that would produce dangerous overpressure.
Confinement, such as in enclosed compressor buildings, can increase the risk of localized damage; however, flame speeds decelerate very rapidly beyond the boundaries of the confinement, and overpressure decreases markedly, even if well mixed vapor clouds exist outside. Natural gas is flammable, of course, and does present a heat radiation hazard when burning. However, the lack of open air overpressures limit the extent of potential injuries.
At the Washington, D.C., hearing an OSHA panel member inquired of a representative of API (Tr. 1885):
OSHA Panel Member: * * * you're talking about some exemptions for gas processing plants, basically those that are dealing mainly with methane * * * could you expand as to what type of radiation hazard we're talking about in a typical situation? Is the danger area 100 meters, 10 meters, 1,000 meters * * *.
API Representative Response: That depends purely on the size of the cloud and for how long it burns. If we're talking about an unplanned release that burns in a matter of seconds, then we're talking about, at most, a very few thousand BTUs that would -- per square foot -- that would be felt over a distance of only a few hundred feet, and probably less than 100 yards from outside the burn cloud. Now of course, if people were inside the burn cloud, that's an entirely different matter. They would probably be killed by the cloud or by inhaling the combustion gases.
OSHA disagrees with commenters that gas processing should be excluded from coverage. While OSHA is very concerned with explosions, OSHA is also concerned with fires resulting from releases of highly hazardous chemicals (55 FR at 29150) which as indicated above can occur and clearly endanger employees in the area. Therefore, OSHA believes that gas plants are appropriately covered by the process safety management standard.
Definitions: Paragraph (b)
Paragraph (b) contains the definitions of terms as they are used in the final rule. The proposed standard contained definitions for the following terms: facility, highly hazardous chemicals, hot work, normally unmanned remote facility, process, and substance hazard index (SHI).
The final standard contains definitions for the following terms: atmospheric tank, boiling point, catastrophic release, facility, highly hazardous chemical, hot work, normally unoccupied remote facility, process, replacement in kind, and trade secret. OSHA has added definitions for "atmospheric tank" and "boiling point" which are already in use in the 1910.106 standard for flammable and combustible liquids in order to clarify the exemption from coverage for flammable liquids stored in atmospheric tanks or transferred which are kept below their normal boiling point without benefit of chilling or refrigeration.
A definition for catastrophic release was also added. The Organization Resources Counselors (Ex. 3: 53, p.3) advocated:
OSHA should add a definition for "catastrophic release" to make it clear that this standard is directed to major accidents which, as stated in the preamble, "have the potential of not only placing employees in grave and imminent danger but also could endanger employees throughout the workplace and even the general public." ORC recommends that the definition read as follows:
"Catastrophic release" means a major uncontrolled emission, fire, or explosion, involving one or more highly hazardous chemicals, that presents serious danger to employees or other persons both within and outside of the immediate workplace.
Other commenters supported the addition of a similar definition (Ex. 3: 12, 17, 48, 64, 71, 97, 101).
OSHA agrees that a definition for catastrophic release will provide for better consistency in the final standard. In the proposed standard OSHA used "catastrophic release" in paragraph (a), purpose, but in paragraph (m), incident investigation, OSHA used the term "major accident." Accordingly, OSHA has defined "catastrophic release" as recommended by ORC, leaving out any reference to "outside the immediate workplace" since OSHA only has jurisdiction to assure workplace safety. Consequently OSHA has changed "major accident" to "catastrophic release" in paragraph (m), incident investigation.
Some participants recommended defining "major accident" to mean any event involving fire, explosion, or release of a substance covered by this section which results in a fatality or five or more hospitalizations for medical treatment (Ex. 3: 106A). OSHA believes that the ORC definition for "catastrophic release" better reflects the intent of the Clean Air Act Amendments which require OSHA to develop a standard to prevent accidental release of chemicals which could pose a threat to employees and that, a definition of "major accident" is not needed.
Few participants raised significant issues concerning the definitions for facility, highly hazardous chemical and hot work. Therefore, these definitions remain the same as proposed.
As noted, OSHA excluded from coverage normally unmanned remote facilities for the reasons discussed above in the application section. OSHA defined "normally unmanned remote facility" in the proposal (proposed paragraph (b)(2)(iii)) as:
Normally unmanned remote facility means a facility which is operated, maintained and serviced by employees who visit the unmanned facility only periodically to check the operation and perform necessary operating or maintenance tasks. No employees are permanently assigned. Facilities meeting this definition must be remote from other facilities.
The American Petroleum Institute (API, Ex. 3: 106) suggested that OSHA recognize that unmanned facilities may exist in remote areas away from the general public locations which possess little potential for a catastrophic event. API as well as other participants (e.g., Ex. 3: 26, 32, 69, 80, 82, 106, 108, 119, 120, 129; Tr. 1540, 3127) recommended retention of this exemption with certain modifications including a redefinition to include 10 or fewer persons potentially affected. API (Ex. 3: 106A, p.3-4) stated:
OSHA recognizes that "unmanned" facilities may exist in remote, away-from-the-general-public locations which possess little potential for catastrophic event. API agrees that it is appropriate to exclude such facilities from this rule in order to allow industry to address more significant facilities with the limited resources available.
API urges OSHA to retain this important exemption and clarify its application by defining the term "normally unmanned" to mean "facilities where the number of persons potentially affected by a major accident is 10 or less". This approach is similar to that taken by the Department of Transportation.
In addition, API suggests that a definition for "remote facility", similar to that published by API in Publication 2510A, "Fire-Protection Considerations for the Design and Operation of Liquefied Petroleum Gas (LPG) Storage Facilities," April 1989, page 4, would be useful and should be included in the rule. The definition in Publication 2510A states: "Remote facility means a facility that is 4000 feet or more from populated or industrial areas involving 10 or more persons."
API emphasizes that its purpose in urging these revisions is not to detract from the need to safely operate remote facilities; rather, it is to support the need to prioritize the allocation of limited resources, within OSHA and industry, for the implementation of the proposed rule.
OSHA's rationale for the exclusion of normally unmanned remote facilities from coverage was that these facilities did not have any employees present on a regular basis, i.e., a daily shift. Rather, employees only periodically visited the facility to check the operation and perform maintenance. OSHA believed that the likelihood of an uncontrolled release injuring or killing employees was effectively reduced by the isolation of the process from employees. The reasons for the exclusion do not allow, nor does OSHA agree with, a redefinition of normally unmanned remote facility to a facility where the number of persons affected by a major accident is 10 or less.
Other participants supported the definition of normally unmanned remote facility but suggested that OSHA clarify the idea that the facility must be remote from other facilities (e.g., Ex. 3: 17, 25, 39, 48, 53, 64, 121). The Organization Resources Counselors (Ex. 3: 53, p.5) noted:
It is important to emphasize that a "normally unmanned remote facility" is not meant to apply to an area that is located in a distant corner of a large facility. Rather, it is meant to apply to facilities that are so far removed from any other facility that they could not contribute to a catastrophic release, fire or explosion as defined by this standard.
Additionally some participants recommended that OSHA modify the language regarding the status of employees who visit the facility periodically (e.g., Ex. 3: 30, 53, 62). They observed that OSHA used the description in the definition "no employees are permanently assigned." Participants pointed out that an employee who visits such facilities periodically may in fact be assigned to the facility. The Chemical Manufacturers Association (Ex. 48, p.8) suggested that OSHA define normally unmanned in the following manner:
"Normally unmanned remote facility" means a facility which is operated, maintained and serviced by employees based at a different location and who visit the remote facility to perform periodic tasks. Remote facilities are not within the boundaries nor are they contiguous to other operations of the employer.
OSHA agrees with these recommendations and has revised the definition to clarify that the facility must be "remote" and has changed the word "unmanned" to "unoccupied" to better reflect the Agency's intent. Accordingly this definition has been revised to read:
Normally unoccupied remote facility means a facility which is operated, maintained or serviced by employees who visit the facility only periodically to check its operation and to perform necessary operating or maintenance tasks. No employees are permanently stationed at the facility. Facilities meeting this definition are not contiguous with, and must be geographically remote from all other buildings, processes, or persons.
The definition of "process" remains essentially the same as proposed except for certain changes made to eliminate unnecessary words, and a modification and addition of language to clarify the intent of the definition. OSHA has eliminated the words "conducted by an employer." These words serve no purpose because OSHA is only addressing processes conducted by an employer.
The term "process" when used in conjunction with the application statement of the standard establishes the intent of the standard. The intent of the standard is to cover a "process" where the use, storage, manufacturing, handling or the on-site movement of a highly hazardous chemical exceeds the threshold quantity at any time. The boundaries of a "process" would extend to quantities in storage, use, manufacturing, handling or on-site movement which are interconnected and would include separate vessels located such that there is a reasonable probability that an event such as an explosion would affect interconnected and nearby unconnected vessels which contain quantities of the chemical that when added together would exceed the threshold quantity and provide a potential for a catastrophic release. In order to clarify this intent, a new sentence has been added to clarify the fact that interconnected and nearby vessels containing a highly hazardous chemical would be considered part of a single process and the quantities of the chemical would be aggregated to determine if the threshold quantity of the chemical is exceeded. The new sentence reads as follows: "For purposes of this definition, any group of vessels which are interconnected and separate vessels which are located such that a highly hazardous chemical could be involved in a potential release shall be considered a single process". Vessels located at more remote distances must be evaluated by the employer to determine if they would interact during an incident, and if such a reasonable condition exists these vessels would be included in the process. Where a dike is used around a liquid storage vessel to fully contain released material and prevent it from interacting with another vessel outside the dike, and neither vessel by itself contains the threshold quantity, then this physical barrier would be considered acceptable in making the two vessels remote from each other.
Additionally, some unnecessary words have been eliminated and the use of the word "movement" used in the proposal has been changed to "on-site movement" to clarify that transportation falling under DOT jurisdiction is not covered.
OSHA believes that its definition of process reflects the intent of the CAAA which requires that the standard be designed to protect employees from hazards associated with accidental releases of highly hazardous chemicals in the workplace.
Based on comments, OSHA has decided to add a definition for "replacement in kind" to clarify the types of changes which are not intended to be included in paragraph (l), management of change. The final definition states that "replacement in kind" means a replacement which satisfies design specifications.
Numerous participants expressed concerns (Ex. 3: 46, 48, 71, 76, 80, 81, 89, 97, 106, 112, 129; Ex. 162; Ex. 171; Tr. 1011, 1823, 2178) regarding trade secrets. For example, the Chemical Manufacturers Association (CMA, Ex. 3: 48, p.2) remarked:
CMA also recommends that OSHA adopt the definition for "trade secret" as found within the Hazard Communication Standard (HCS) * * * The final standard should also incorporate Appendix D from the HCS.
In its post-hearing comment, CMA (Ex. 128, p.18) expressed its concern again that:
The issue of trade secret protection has not been addressed within the proposed standard. Trade secret information may be included within a number of documents created as a part of implementing the proposed PSM standard. Unless trade secrets are protected, items which include trade secret information collected by OSHA as a result of an inspection could be made public. This situation could result in damage to an employer's competitive position. CMA previously provided curative language and strongly suggests that OSHA consider using it in the final standard.
OSHA has decided to include the definition for trade secret from 1910.1200, Hazard Communication, and has included provisions in a new paragraph. These trade secret provisions will be discussed below.
Employee participation: Paragraph (c).
In the proposed standard, OSHA required that a team be used to conduct a process hazard analysis (proposed paragraph (e)(3)). The proposal required that the team have expertise in engineering and process operations, and the team was required to have at least one employee who had experience and knowledge specific to the process being evaluated. In Issue 5 of the proposal (55 FR at 29158), OSHA asked whether it should require an employee representative on the process hazard analysis team, as well as on the incident investigation team required for incident investigations (proposed paragraph (m)). It had been proposed that an incident investigation team consist of persons knowledgeable in the process. OSHA asked if the presence of an employee representative on the teams would assist in developing a cooperative participatory environment and the necessary flow of information from management to employees and from employees to management.
Several rulemaking participants supported the concept of having an employee representative on both the process hazard analysis team and the incident investigation team (Ex. 3: 20, 25, 47, 115; Tr. 2086, 2235, 2345). However, numerous participants objected to OSHA mandating the inclusion of an employee representative on the teams required by the standard and most stressed that team members should be chosen on the basis of their expertise and not on union membership (e.g., Ex. 3: 9, 21, 26, 28, 29, 30, 32, 41, 45, 59, 62, 69, 70, 76, 77, 80, 103, 106, 109, 112, 120, 123, 127, 129, 141, 155; Tr. 670, 740, 763, 1012, 1813, 2061, 2157, 2573-4, 3238, 3351, 3411).
The issue of employee participation in process safety management received even greater attention after the Clean Air Act Amendments (CAAA) were signed. The CAAA contains a requirement in section 304(c)(3) that the employer "consult with employees and their representatives on the development and conduct of hazard assessments and the development of chemical accident prevention plans and provide access to these and other records required under the standard."
Participants focused on what they believed was the intent of the CAAA and its language and suggested the manner in which the intent should be included in the final standard. Representatives from the United Steelworkers of America observed:
(Tr. 2235) The Clean Air Act Amendments make it clear that workers and their representatives -- it is in the law -- are to have an important role in process safety management.
(Tr. 2258) I want to clarify that the word participation and consultation means only that. They do not imply the power to veto or to change the programs required under this proposed standard * * *.
(Tr. 2356) Consult, to us means -- or should mean that we are part of the process, that we have a voice in discussing the kind of information that is developed in writing and reviewing those reports. You know, it doesn't mean that we get to write the report to the exclusion of management, but it means that we ought to be part of the team.
Other participants suggested that the language in the CAAA be incorporated as a separate paragraph in the OSHA final standard and asserted that the language did not mandate an employee representative on the team conducting process hazards analyses or incident investigations.
A participant from Exxon U.S.A. (Tr. 3314) stated:
We conclude that the "consult with employees" provision in the Clean Air Act Amendments does not require that employees or their representatives be PHA [process hazard analysis] team members.
The requirement calls for the employer to exchange views on a process hazard analysis with employees and their representatives before a PHA is started.
Review of the wording in the clean Air Act would appear to call for a more structured exchange of views with wage personnel before starting a PHA.
Designated union representatives, such as union members on a plant safety committee, could be include in pre- and post-PHA discussions with wage employees.
A representative from the National Petroleum Refiners Association (Tr. 3372-74) testified:
As you are well aware, the operative wording from the Clean Air Act Amendment is consult with employees and their representatives on the development and conduct of hazard assessments and the development of chemical accident prevention plans, and provide access to these and other records required under the standard.
Now that is the law of the land, and we are clearly going to have to do that.
In Shell Oil Company, we think we know how to do that. We have consulted -- we have well established procedures in place for consulting with our unions * * *.
We don't -- speaking for Shell Oil Company, we don't believe that we need additional OSHA words -- pages of regulations to help us interpret what consult with employee representatives means * * *.
Now, what is our position on involvement on teams? First, we support the involvement of workers on teams. We feel that the worker, the operator, the maintenance person, the foreman also can contribute significantly to the value of a PHA team.
But what they bring to that team is their knowledge of the unit in question, their knowledge of the operating practices, their knowledge of the maintenance practices in that particular unit, and those are the attributes they bring to that team and the participant workers should be selected on the basis of bringing those skills to the team rather than filling a role.
After a thorough analysis of the CAAA and the rulemaking record on this issue, OSHA has concluded that it is important for one member of each team be an employee who is knowledgeable about the process. This employee may very well be an employee representative; or, an employee representative may be participating on a team because of some expertise that the individual can contribute to the team. However, OSHA does not believe it necessary or appropriate to mandate team membership on the basis of organization affiliation (i.e., union membership), nor does the Agency believe that this was the intent of the CAAA.
OSHA believes that the intent of the CAAA demands a broader approach to employee participation. A participant from the United Steelworkers of America (Tr. 2257) asserted:
Workers and their representatives should have the right to participate in the development of hazard analysis, incident investigations and all safety audits. They should be consulted with respect to training, maintenance and emergency response programs.
OSHA agrees with this participant. This confirms OSHA's belief that a broader participation was envisioned by the CAAA. OSHA believes that employers must consult with employees and their representatives on the development and conduct of hazard assessments (OSHA's process hazard analyses) and consult with employees on the development of chemical accident prevention plans (the balance of the OSHA required elements in the process safety management standard). And, as prescribed by the CAAA, OSHA is requiring that all process hazard analyses and all other information required to be developed by this standard be available to employees and their representatives.
Therefore, as suggested by several rulemaking participants, OSHA has added language contained in the CAAA to the final rule in a new provision, paragraph (c). OSHA believes that this new provision, which requires broad and active employee participation in all elements of the process safety management program through consultation will enhance the overall program. OSHA also believes that the CAAA requirements demand that an employer carefully consider and structure the plant's approach to employee involvement in the process safety management program. Consequently, OSHA believes that it must require the employer to address this issue to ensure that the employer actively considers the appropriate method of employee participation in the implementation of the process safety management program at the workplace. Thus, OSHA has included a specific requirement that an employer develop a plan of action on how the employer is going to implement the employee participation requirements.
The new paragraph which has been added to the final process safety management rule, paragraph (c), reads as follows:
Employee participation. Employers shall develop a written plan of action regarding the implementation of the employee participation required by this paragraph.
Employers shall consult with employees and their representatives on the conduct and development of process hazard analyses and on the development of the other elements of process safety management in this standard.
Employers shall provide to employees and their representatives access to process hazard analyses and to all other information required to be developed under this standard.
Process Safety Information: Paragraph (d).
Paragraph (d) addresses process safety information. OSHA proposed that the employer develop and maintain certain important information about a covered process such as information about the hazards and characteristics of the chemicals used, information about the process technology and how it works and information about the process equipment. This process safety information was to be communicated to employees involved in operating the process.
The compilation of information concerning process chemicals, technology and equipment provides the foundation for identifying and understanding the hazards involved in a process and is necessary in the development of a complete and thorough process hazard analysis, as well as other provisions in the final rule including management of change, operating procedures, and incident investigations, etc.
A number of participants had recommendations to clarify the process safety information provisions. OSHA has made changes to this paragraph based on these recommendations, where such suggestions did not change the intent of the provisions.
OSHA has decided to allow the compilation of process safety information to occur on a schedule consistent with the schedule for conducting process hazard analyses as described in final paragraph (e)(1). It is necessary to assemble the process safety information specified in the final rule in order to conduct an adequate process hazard analysis. Therefore it is reasonable to allow the collection and compilation of process safety information on a given process to be completed before a process hazard analysis on that process is begun, instead of requiring the compilation of all process safety information on all processes to be completed before any process hazard analyses are begun.
Many participants objected to the requirement that the process safety information must be communicated to employees (e.g., Ex. 3: 17, 26, 33, 41, 48, 53, 103, 106, 109, 112, 119, 158). Participants noted that a lot of the process safety information was highly detailed and expressed their doubts concerning the usefulness of communicating such detail to employees. They believed that such information should be made available to employees rather than communicated to them. Paragraph (c) of the final rule, employee participation, requires that employees and their representatives must have access to process hazard analysis reports and to all other information required to be developed under this standard. The recommended change to make the information available is unnecessary in view of this requirement. Also, OSHA believes that process safety information pertinent to the employees job tasks is required to be communicated to employees by the final standard: to operating employees in paragraph (g); to contract employees in paragraph (h); and to maintenance employees in paragraph (j). Therefore the requirement contained in paragraph (d) to communicate the process safety information to employees has been deleted since it is provided for by other provisions of the final standard, such as employee participation, contractors, and training.
The process safety information required by paragraph (d)(1) pertains to the hazards of the highly hazardous chemicals in the process. OSHA proposed that the information include: toxicity information; permissible exposure limits; physical data; reactivity data; corrosivity data; thermal and chemical stability data; and the hazardous effects of inadvertent mixing of different materials that could foreseeably occur. Most of the information may already be available from the material safety data sheet (MSDS). MSDSs would be acceptable in meeting this requirement to the extent that the required information is available on the MSDS. The information required to be collected on the hazards of the chemicals is unchanged from the proposal.
In paragraph (d)(2) OSHA proposed that the employer develop and maintain information pertaining to the technology of the process itself. Paragraph (d)(2)(i) specified the required information and included the following: a block flow diagram or simplified process flow diagram; process chemistry; maximum intended inventory; safe upper and lower limits for such factors as temperatures, pressures, flows or compositions; and the consequences of any deviation in the process including those affecting the safety and health of employees. The final requirements remain virtually the same as those proposed except for a few minor editorial changes.
OSHA indicated in proposed paragraph (d)(2)(ii) that it might be difficult to obtain technical information for older existing processes. Therefore, it proposed to allow employers to develop such material from a hazard analysis conducted in accordance with paragraph (e) for processes initiated before January 1, 1980. OSHA believed that a properly conducted process hazards analysis should systematically identify technical information regarding the process and allow for adequate estimation of safe parameters for the process.
OSHA has reconsidered this paragraph and has decided that the best technical information available is the original information. Rather than include an arbitrary date, OSHA has decided to allow an alternate method of obtaining the technical information only for those processes where such information does not exist. In reviewing the record OSHA concluded that the American Petroleum Institute's RP 750 had acceptable language which met the intent of the Agency. Accordingly, OSHA has changed the final paragraph, (d)(2)(ii), to read as follows:
Where the original technical information no longer exists, such information may be developed in conjunction with the process hazard analysis in sufficient detail to support the analysis.
The final type of information that the proposal required to be collected ((d)(3)) pertains to the equipment in the process. Since the equipment used in a process can have a significant adverse impact on the facility and employee safety, OSHA wanted to assure that the equipment is appropriate for the operation and that it meets appropriate standards and codes such as those published by the American Society of Mechanical Engineers, the American Petroleum Institute, etc.
In paragraph (d)(3)(i) OSHA proposed that information be compiled concerning equipment used in the process including: materials of construction; piping and instrument diagrams (P&IDs); electrical classification; relief system design and design basis; ventilation system design; design codes employed; material and energy balances for processes built after the effective date of this standard; and safety systems (such as interlocks, detection, monitoring and suppression systems). Again, this paragraph remains virtually unchanged except for minor editorial changes.
In paragraph (d)(3)(ii) OSHA proposed that the employer document that the process equipment being used complies with applicable consensus codes and standards, where they exist; or be consistent with recognized and generally accepted engineering practices. OSHA has modified this paragraph by eliminating the list of codes and standards producing organizations. The discussion in paragraph (j), mechanical integrity, discusses the reasons for this change.
Paragraph (d)(3)(iii) required that where existing equipment was designed and constructed in accordance with codes, standards, or practices that are no longer in general use, the employer must ascertain that the equipment is designed, installed, maintained, inspected, tested and operated in such a way that safe operation is assured.
There are many instances where process equipment has been in use for many years. Sometimes the codes and standards to which the equipment was initially designed and constructed are no longer in general use. For this type of situation, OSHA wants to ensure that the older equipment still functions safely, and is still appropriate for its intended use. OSHA is not specifying the method for this documentation. Under this approach the employer would be permitted to use any of several methods such as: documenting successful prior operation procedures; documenting that the equipment is consistent with the latest editions of codes and standards; or performing an engineering analysis to determine that the equipment is appropriate for its intended use. This paragraph remains the same as that which was proposed except the final rule requires the employer to determine and document that the equipment is "designed, maintained * * * and operating in a safe manner rather than "operating in such a way that safe operation is assured," as was proposed.
OSHA believes that the final provisions concerning process safety information meet the requirements in section 304(c)(1) of the CAAA. In this section OSHA must require employers to:
(1) Develop and maintain written safety information identifying workplace chemical and process hazards, equipment used in the processes, and technology used in the processes.
Process hazard analysis: Paragraph (e).
The vast majority of commenters addressed proposed paragraph (e) concerning process hazards analysis, often referred to as "hazard evaluation" (e.g., Ex. 3: 20, 21, 25, 26, 27-29, 33-35, 39, 41, 43-45, 59, 64, 69, 70, 76, 77, 79, 80 83, 89, 77, 96, 109, 112, 115, 119, 120, 122, 123, 126, 129, 138, 141, 149, 152, 155, 156, Ex. 91; Ex. 127; Ex. 141; Ex. 148; Tr. 671, 735, 968, 1018, 1114, 1206, 1922, 2059, 2156, 2174, 2572, 2650, 2689, 2773, 3136, 3259, 3348, 3683). These commenters were generally supportive of the provisions regarding process hazards analyses recognizing that the process hazard analysis is a key component of a process safety management system because it is a thorough, orderly, systematic approach for identifying, evaluating and controlling processes involving highly hazardous chemicals. However, participants recommended certain modifications to the process hazard analysis provisions. Participants also addressed several issues OSHA raised in the notice of proposed rulemaking (Issues 3, 4 and 5; 55 FR at 29158) concerning process hazard analysis timeframes, acceptable methodologies and process hazard analysis team membership.
In paragraph (e)(1) OSHA proposed to require employers to conduct an initial process hazard analysis on facilities covered by the standard in order to identify, evaluate and control the hazards of the process. By properly performing a hazard analysis, the employer can determine where problems may occur, take corrective measures to improve the safety of the process and preplan the actions that would be necessary if there were a failure of safety controls or other failures in the process. Paragraph (e)(1) required the employer to conduct the process hazard analyses using one of the methodologies listed.
Paragraph (e)(1) of the final standard reflects several changes from the proposal. The final standard still requires employers to conduct a process hazard analysis to identify, evaluate and control the hazards in a process. The provision addressing methodologies has been moved to paragraph (e)(2).
Also in paragraph (e)(1) is a new requirement that an employer select a process hazard analysis method which is appropriate to the complexity of the process being analyzed. This requirement was implicit in the proposal. The new language simply states OSHA's concern that an employer not choose an inappropriate process hazard analysis methodology.
OSHA anticipates that employers will be able to readily explain their plans for completing process hazard analyses and their reasoning for prioritizing which processes will be addressed first. Therefore OSHA is requiring that employers determine and document the priority order for conducting process hazard analyses based on such considerations as the extent of the process hazards, number of potentially affected employees, age of the process, and operating history of the process. This requirement is written flexibly in recognition of the fact that different processes will require different considerations for prioritization.
A phase-in period for process hazard analyses may be necessary, particularly, for facilities with multiple covered processes. However OSHA believes that plants with a limited number of processes, with simple processes, or which have already completed a number of process hazard analyses, should complete process hazard analyses as soon as possible. Therefore, the final standard language indicates that process hazard analyses must be conducted as soon as possible.
In Issue 3 of the preamble to the proposal (55 FR at 29154) OSHA noted that no time period was specified in which to complete initial process hazard analyses. It had been suggested to OSHA that a 1, 2, 3, or 5-year delay be allowed for employers to complete initial process hazard analyses. These extended compliance scenarios were based on the perception that there were not enough technical experts who had the experience to carry out the analyses required by the proposal. The issue was discussed extensively in the rulemaking.
A significant majority of participants discussed the timeframes they believed would be necessary to complete initial process hazard analyses. Recommended timeframes ranged from immediately to as many as ten years. The majority of commenters supported either a 5 year timeframe (e.g., Ex. 3: 21, 16, 33, 41, 43, 44, 48, 59, 64, 70, 76, 80, 77, 96, 109, 112, 122, 123, 129, 134, 138, 141, 149, 155, Ex. 127; Tr. 1018, 1114, 1206, 1922, 2059, 2156, 2689) or a 7 year timeframe (e.g., Ex. 3: 27, 28, 29, 39, 45, 69, 77, 106, 120; Ex. 91, Ex. 148; Tr. 671, 735, 968, 2174, 2572, 2478, 2594, 2650, 2773, 3136, 3259, 3348, 3683) in which initial process hazard analyses could be completed on covered processes. These suggested timeframes were based on similar reasons. For example, the National Cooperative Refinery Association (NCRA, Ex. 3: 21) stated:
NCRA, like most independent refineries, does not have sufficient staff to complete a project of this magnitude without extensive use of contract consultants * * *. Preliminary information indicates that it will be very difficult, if not impossible, for us to complete the analysis of all of the process units in the refinery in less than five years.
The American Petroleum Institute (API, Ex. 3: 106A, p.7) noted:
API shares OSHA's concern that compliance with this rule could overwhelm existing resources unless an adequate implementation period is allowed. Further, API believes that experienced personnel needed to lead and participate in the process hazard analysis studies are not available in numbers sufficient to comply with the rule in fewer than seven years.
Marathon Oil Company (Ex. 3: 108) observed:
To start off, Marathon supports process safety management. Since the American Petroleum Institute published API Recommended Practice 750, "Management of Process Hazards" in January 1990, we have started implementing RP-750. This is a major, resource-intensive effort that we accepted voluntarily and estimate that it will require at least five years for implementation.
Phillips Petroleum (Ex. 3: 129, p.3) indicated:
Completion of initial PHA should be within five years of the effective date. We feel this timeframe is needed to achieve quality results with the limited resources available, and the amount of complexity of the information to be handled.
Sun Refining and Marketing Company (Ex. 3: 155, p.1-2) remarked:
Sun recommends that OSHA require all of the initial