pumps and piping system inside of industrial plant at night

The Occupational Safety and Health Administration (“OSHA”) published a Request for Information (“RFI”)  on December 9, 2013 concerning possible changes to the Process Safety Management (“PSM”) program codified at 29 C.F.R. 1910.119.  See 78 Fed. Reg. 73756 (Dec. 9, 2013).  Likewise, the Environmental Protection Agency (“EPA”) published an RFI on July 31, 2014 relating to possible changes to the similar Risk Management Program (“RMP”) rules codified at 40 C.F.R. Part 68.  See 79 Fed. Reg. 44604 (July 31, 2014).  At the time of this writing, the respective comment periods have closed and we are waiting to see new proposed regulations. This is the third article in a series of articles concerning these potential rulemaking actions.

Both OSHA PSM and EPA RMP rules require use of recommended and generally acceptable good engineering practices (“RAGAGEP”) in relationship to equipment construction, inspection, and testing.  See 29 C.F.R 1910.119(d)(3)(ii) and (j)(4)(ii) and 40 C.F.R 68.65(d)(2) and 68.73(d)(2).  In the RFIs, OSHA and  EPA requested comment as to whether employers or “owner or operators” (hereafter “owners”) should be required to evaluate updates to applicable RAGAGEPs.  Although many comments addressed this question, this article will compare comments from three organizations:  the United Steelworkers, the American Petroleum Institute (“API”), and the U.S. Chemical Safety Board (“CSB”).

One of the elements of PSM and RMP is “Process Safety Information” or “PSI.”  Within this element, employers or owners must document the “design codes and standards employed” in constructing the facility.  See 29 C.F.R 1910.119(d)(3)(i)(F) and 40 C.F.R 68.65(d)(1)(vi). As a general matter, buildings are constructed consistent with then existing building codes.  If you have had the pleasure of remodeling a home, you know that remodeled work may be required to meet current codes per city ordinances or state regulation.  As part of the RFI, OSHA and the EPA sought comment as to the need to require consideration of updates as part of an employer’s PSM or owner’s RMP program.

Both PSM and RMP require that the employer or owner document that equipment meets RAGAGEP.  See 1910.119(d)(3)(ii) and 68.73(d)(2).  RAGAGEP for existing equipment is typically based on the date of construction.  For existing equipment built to older codes, both programs require documentation “that the equipment is designed, maintained, inspected, tested, and operated in a safe manner.”  See 1910.119(d)(3)(iii) and 68.73(d)(3).   The question posed by OSHA and the EPA is whether facilities, presumably including unmodified facilities, should consider updated standards or codes any time a code or standard is updated.  By requiring updates to RAGAGEP, unmodified “safe” equipment could require modification or replacement to remain compliant.

Both OSHA’s RFI and the CSB’s comments discuss one accident to justify their position that updates to the standards and codes relied upon as RAGAGEP should be evaluated.  The cited incident involved a propylene explosion resulting from a release caused by a forklift that snagged a drain line.  According the CSB’s comments:

Had fireproofing material been used on the steel structure supporting the pressure relief valves and emergency vent piping, the consequences of this incident would likely have been less severe.  However, the designs for the unit were never updated to incorporate the latest RAGAGEP.  The likelihood of these types of incidents can be significantly reduced if operators are required to evaluate updates to applicable RAGAGEP after compliance with either §1910.119(d)(3)(ii) or (iii)

CSB Comments to OSHA, p. 18 (Mar. 31, 2014).  Also see, CSB Comments to the EPA, p. 23 (Oct. 28, 2014).

According to the final CSB report on the accident, the incident occurred in the Olefins II unit at a facility in Texas.[1]  The  CSB final report indicated that although the Olefins II unit was designed in 1996, it was based on a design from the mid-1980s and allegedly did not consider American Petroleum Institute (“API”) Publication 2218, “Fireproofing Practices in Petroleum Plants” (July 1988).[2]  Here the issue was a unit that was actually designed in 1996 but allegedly did not consider a standard developed eight years prior.  The CSB’s recommendation in the final report is much narrower than the question posed in the OSHA RFI or the CSB comment provided.  It stated:

Evaluate the applicability and use of current consensus safety standards when designing and constructing a chemical or petrochemical process plant.  This should include reviewing and updating earlier designs used for new facilities.[3]

The CSB’s comment in its report addresses the need to consider available RAGAGEPs at the time the unit is designed and built.  The United Steelworkers’ comments appear be more consistent with the narrower concern enunciated in the CSB’s final report:

Again, the intent was the ability to upgrade to new practices without having to rewrite the standard.  Grandfathering is not used anywhere in the standard but we often hear that as an excuse for not bringing equipment up to newer RAGAGEP qualifications when it must be replaced or modified.

United Steelworkers comments to OSHA, p. 4 (Mar. 31, 2014) (emphasis added).  In short, the Steelworkers do not appear to assert that updated RAGAGEP should be applied to unmodified equipment, but rather to equipment that is being replaced or modified.

The API comments question the need for using updated RAGAGEP on unmodified equipment. According to the API:

The issuance of an updated edition of an industry document (i.e., RAGAGEP) does not mean a previous version was necessarily unsafe because it was designed to a previous version of an industry standard at the time of installation.

API comments to OSHA, p. 9 (March 31, 2014).  Additionally, API expresses concern about the practicality of such a requirement:

Not all consensus standards are free to the public and subscriptions to all potentially applicable standards publications represent a significant cost, especially to small businesses.  In addition, the task of evaluating all standards updates would be extremely time-consuming for any sized company, and unjustifiably expensive for smaller enterprises.

Id.

The RFI seeks comments on the requirement to evaluate updates of codes and standards.  The CSB concludes that employers and owners should be required to consider updates.  This leaves open the question, can an employer evaluate or consider an update but conclude that, for whatever reason, it is not reasonable to alter their existing equipment?  This question is particularly relevant to equipment that has not been modified. Under what circumstances does the employer or owner need to modify existing and unmodified pieces of equipment?  Such ambiguity is troubling especially in view of the CSB’s comments that RAGAGEPs should “not be couched in permissive language.”  CSB comments to the EPA, p. 23 (Oct. 29, 2014).  In essence, the CSB’s comments could be read as advocating that RAGAGEPs should not allow an owner or operator to evaluate, consider, and then reject. When OSHA and the CSB say evaluate and consider, will the employer or owner have the option to stay with the status quo?  What time limits would apply to any such evaluation requirement?  What type of documentation of such consideration would be required? All of these are questions that may arise in the future rulemaking actions in these dockets.

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[1] CSB Case Study,  (June 2006), found at http://www.csb.gov/assets/1/19/Formosa_Report.pdf (last visited Mar. 17, 2015).
[2] Id., at p. 8.
[3] Id., at p. 13.