As you plan for 2016, be sure to review the changes made by the U.S. Occupational Health and Safety Administration (OSHA) to its Process Safety Management (PSM) of Highly Hazardous Chemicals (HHCs) standard in 2015. These changes may result in additional facilities and processes being subject to the PSM standard, and may require more rigorous management and documentation of recognized and generally accepted good engineering practices (RAGAGEP).

What Changed and What Do You Need to Do?

New Interpretation for Covered Concentrations of HHCs

As of June 2015, OSHA adopted a new policy on threshold calculations for mixtures of HHCs. Appendix A of the PSM standard lists 137 highly hazardous chemicals, including 11 with a listed minimum concentration. Each chemical has a listed threshold quantity, but for the 126 chemicals with no listed concentration there has long been confusion regarding what quantity to count toward thresholds.

The June 2015 memorandum expanded the applicability of PSM for employers handling low concentration chemicals. The new policy shifts from the previous “pure chemical” threshold determination to basing calculations on concentrations of greater than one percent, which is consistent with the Environmental Protection Agency’s (EPA) policy under the Accidental Release Prevention standard (40 CFR 68). However, if the partial pressure of the chemical in the vapor space under handling or storage conditions is less than 10 millimeters of mercury, the weight of the chemical does not need to be included in threshold calculations. When determining threshold quantities, only the weight of the chemical itself is calculated, exclusive of any solvent, solution, or carrier. Employers should review their threshold calculations for all HHCs to determine if there are additional chemicals or processes subject to PSM and ensure that the basis for all calculations is documented.

Clarified RAGAGEP Enforcement Policy

OSHA’s June memo also clarified its enforcement policy for the PSM standard’s RAGAGEP requirements as outlined in 29 CFR 1910.119, (d)(3)(ii), (j)(4)(ii), and (j)(4)(iii). Since RAGAGEP is not defined in the standard, OSHA refers to the definition found in the Center for Chemical Process Safety (CCPS) Guidelines for Mechanical Integrity Systems.

Because there could be many RAGAGEP that apply to a covered process, it’s up to employers to select the RAGAGEP that applies to their covered processes, verify that all standards used for design, maintenance, testing, and inspection are protective, and document the basis for their determinations. It’s critical that employers comprehensively document the basis for selecting and applying RAGAGEP standards, particularly when adopting alternate standards (in lieu of published consensus standards) or where the consensus standards utilized are outdated. When more stringent internal standards are adopted as RAGAGEP, failure to meet these internal standards can still result in enforcement action.

New Interpretation for Retail Facility Exemption

The PSM standard includes an exemption from coverage for retail facilities, but never defined what a “retail facility” was. In July 2015, OSHA issued a new interpretation, defining only those portions of a facility engaged in retail trade, as defined by the North American Industrial Classification System (NAICS) for sectors 44 and 45, as eligible for the retail facility exemption. Employers claiming eligibility for the retail facility exemption should be prepared to provide justification of the basis for their exemption.

Enforcement activities for facilities that are subject to the PSM standard based on the new retail exemption interpretation will initially focus on compliance assistance, rather than enforcement, until July 22, 2016. This affords facilities newly subject to PSM ample time to develop and implement an effective PSM program. However, after that time, OSHA will likely place an emphasis on enforcement.

Taking Action

The most important step you can take in light of all of these new interpretations is to verify whether the PSM standard applies to your operations by reviewing your chemical inventory and threshold calculations and the basis for any exemptions. As part of this process, documentation of threshold calculations should be maintained on file, and the calculations should be periodically reviewed and updated. Documenting why you have selected RAGAGEP, why certain equipment design and maintenance standards have been selected, and what internal standards have been developed—including verification that these standards are at least as protective as published industry standards—is critical. An outside firm can be helpful in both conducting the initial applicability assessment and auditing existing PSM programs to ensure that the appropriate standards are adopted and regularly reviewed and to ensure that sufficient documentation is in place.

If your company is already subject to the EPA Risk Management Program (RMP) requirements, you may only need to add new PSM elements to your existing RMP based on the new HHC policy. Companies newly subject to the PSM standard may need to consult with a third party firm to ensure that all elements of a PSM program are appropriately developed and implemented.

2016 Developments

To improve chemical facility safety and security as mandated by Executive Order (EO) 13650, OSHA will continue to update and clarify the PSM standard for several years to come. According to OSHA personnel, the PSM regulatory agenda for 2016 will include a continued review of required changes to the PSM standard under the Small Business Regulatory Enforcement Fairness Act (SBREFA) and the issuance of a new National Emphasis Program for the chemical industry (Chem NEP), which is anticipated to include petroleum refineries.

About the Author

Jan Baldauf, PE, CPEA, is a Senior Client Services Manager with TRC, where she works with industrial clients to develop strategies for minimizing risks, maintaining compliance with complex environmental, health, and safety (EHS) regulations and improving safety performance. Jan has over 28 years of proven and practical EHS experience and has worked extensively with industrial clients to develop and implement effective risk management programs and control strategies for high risk operations, such as those involving the use of highly hazardous chemicals.

Photograph: Twirl Cloth 4 by Billy Alexander.

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