Proposed Changes to OSHA PSM: How it May Affect Your Site

In September 2022, OSHA formally announced proposed amendments to the Process Safety Management (PSM) standard in response to Executive Order 13650. This executive order, signed in 2013, required OSHA and EPA to perform “modernization” efforts to their respective PSM and Risk Management Program (RMP) standards. EnSafe attended OSHA’s PSM Stakeholder meeting in October 2022 to hear from OSHA and industry representatives on the proposed changes. The proposed changes from OSHA are broken into categories and noted in bold below, with additional clarification provided from EnSafe:

PSM Scope and Applicability

  • Clarifying the exemption for atmospheric storage tanks – OSHA intends to clarify the flammable liquid atmospheric storage tank exemption, codified in 119(a)(1)(ii)(B), to reduce confusion regarding the difference in standard interpretation between OSHA and the notable Meer court decision. OSHA’s original intent of the exemption was to waive PSM coverage for the storage of flammable liquids at atmospheric pressure below their boiling points without the use of refrigeration, but only if they were not interconnected or located nearby to PSM-covered process vessels such that a failure of the PSM-covered vessels could affect the flammable liquids in storage, and vice versa. This definition of a single PSM-covered process is already codified in 1910.119(b). However, the court in the Meer decision ruled that such atmospheric storage tanks were not PSM-covered, even if they were interconnected or located nearby to PSM-covered process vessels. Since the Meer decision, OSHA has not cited the PSM standard in cases where the aggregate quantity of flammable liquids in a process surpasses the 10,000-pound applicability threshold if the exceedance is due to atmospheric storage of flammable liquids. However, OSHA is considering amending this section of the standard to enforce their original intent. For example, an atmospheric storage tank holding 8,000-pounds of a flammable liquid that is directly plumbed to a mixing vessel containing 5,000-pounds of a flammable liquid mixture currently would not be PSM-covered under the Meer decision but would be PSM-covered under this proposed amendment to the PSM standard.
  • Expanding the scope to include oil and gas well drilling and servicing – The PSM standard currently does not require coverage for oil and gas well drilling and servicing operations due to the fact that OSHA originally intended to publish a separate standard to cover these industries. Such a standard was never published, and thus OSHA is considering adding PSM coverage to these types of operations.
  • Resuming enforcement for oil and gas production facilities – OSHA published a memo in 2000 stating that oil and gas production facilities (i.e. upstream operations between the drilling and pipeline phases) are temporarily exempt from the PSM standard, pending the completion of an economic analysis. OSHA has stated that they are working on this analysis and intend to resume PSM coverage of such facilities following its completion.
  • Clarifying the scope of the retail facilities exemption – OSHA exempts “retail facilities” from coverage in section 119(a)(2)(i) of the PSM standard, however they do not define what constitutes a “retail facility.” The preamble to the PSM standard provides the sole example of gas stations as a “retail facility,” and an OSHA memo published in 2018 cited a court decision that exempted certain agricultural wholesalers from PSM-coverage, but OSHA still has not provided a clear definition on the term. OSHA is proposing to define “retail facilities” in the updated PSM standard to clarify the exemption.
  • Amending paragraph (k) of the Explosives and Blasting Agents Standard (§ 1910.109) to extend PSM requirements to cover dismantling and disposal of explosives and pyrotechnics – The manufacturing of explosives and pyrotechnics is currently covered under the PSM standard, as referenced in 109(k). Furthermore, there is no threshold quantity of these energetics that triggers PSM coverage – meaning, that manufacturing of these energetics at any quantity automatically triggers PSM coverage. OSHA is considering extending PSM coverage to the dismantling and disposal of these energetics as well due to the similar hazards.
  • Updating and expanding the list of Highly Hazardous Chemicals, Toxics and Reactives in Appendix A – Appendix A to the PSM Standard contains Threshold Quantities (and in some cases, concentrations) for toxic and reactive chemicals that trigger PSM coverage. OSHA is considering adding new chemicals to the list and modifying existing concentration thresholds for some chemicals in Appendix A. Notably, OSHA is considering adding ammonium nitrate to the list. Moreover, OSHA is considering broadening PSM coverage to reactive chemical classes in addition to specific substances, potentially adopting the same approach as  New Jersey’s Toxic Catastrophe Prevention Act (TCPA) . TCPA lists 44 different chemical functional groups, such as acetylenic compounds and alkyl perchlorates, as a supplement to a list of specific reactive chemicals to require TCPA coverage more broadly for reactive hazards.
  • Defining the limits of a PSM-covered process – OSHA published a memo in 2016 clarifying the coverage of highly hazardous chemicals listed in Appendix A that do not have a listed concentration. The memo adopts a similar method to EPA’s “One Percent Test” when calculating chemical quantities, meaning that the weight of a highly hazardous chemical in excess of one percent in a mixture must be considered when comparing to the threshold quantity. OSHA provides the example of a 2000-pound mixture of 50% chloropicrin (which has a threshold quantity of 500-pounds but no listed concentration) to equal 1000-pounds of “pure” chloropicrin, thus exceeding the 500-pound threshold quantity and requiring PSM coverage. OSHA is considering codifying this “One Percent Rule” in the text of the PSM standard, as opposed to citing the 2016 memo.

Employee Participation

  • Expanding paragraph (c) to strengthen employee participation and include stop work authority – The concept of “Stop Work Authority” empowers employees to call a stop to work if imminent hazardous conditions are perceived. OSHA is considering codifying the concept of “Stop Work Authority” into the Employee Participation section of the PSM standard in paragraph (c).

Process Safety Information (PSI)

  • Amending paragraph (b) to include a definition of RAGAGEP – OSHA published a memo in 2016 explaining the PSM standard’s definition and enforcement of Recognized and Generally Accepted Good Engineering Practices (RAGAGEP). Specifically, the memo provides examples of acceptable RAGAGEP, and how employers are expected to interpret the requirements contained within these standards and documents. OSHA is considering codifying the definition and requirements of RAGAGEP into the PSM standard instead of deferring to the 2016 memo.
  • Amending paragraph (d) to require evaluation of updates to RAGAGEP and continuous updating of collected information – Consensus standard documents, such as those published by the National Fire Protection Association and the American Petroleum Institute, are periodically updated as new scientific data, process hazards, and incidents are identified. These documents are often used as RAGAGEP, and OSHA is considering requiring employers to evaluate their existing RAGAGEP to see whether any subsequent consensus standard updates affect the operation of their PSM-covered process equipment.

Process Hazard Analysis (PHA)

  • Amending paragraph (e) to require formal resolution of PHA team recommendations that are not utilized – Not all recommendations developed by a PHA team will be deemed feasible following review. Because of this, the PSM standard does not require sites to “implement” all PHA recommendations, but rather “resolve” them. However, OSHA is seeking to prevent sites from “resolving” PHA recommendations that are not implemented without justification. Specifically, OSHA is considering a requirement for employers to document the rationale for discarding PHA recommendations that are not deemed feasible, and to ensure that the process risk is still adequately addressed through additional or changed recommendations.
  • Expanding paragraph (e) by requiring safer technology and alternatives analysis – OSHA is considering incorporating some form of the hierarchy of controls into the PSM standard to require employers to assess whether process hazards can be eliminated altogether or substituted for safer alternatives during a PHA. Typically, a PHA focuses on reducing risk through the layering of engineering and administrative controls, but this proposed amendment would require employers to document an assessment of the more effective elimination and substitution layers of the hierarchy of controls.
  • Clarifying paragraph (e) to require consideration of natural disasters and extreme temperatures in their PSM programs, in response to E.O. 13990 – One of OSHA’s expectations of the PHA element is that sites adequately address the risks posed to a PSM process due to natural disasters and other types of extreme weather events. However, such a statement is not explicitly codified in the standard. In response to Executive Order 13990 signed in 2021, OSHA is considering adding clear language in the PHA element of the PSM standard to ensure that employers understand their obligation to address these types of risks during the PHA.

Mechanical Integrity (MI)

  • Amending paragraph (b) to include a definition of critical equipment and expanding paragraph (j) to cover the mechanical integrity of any critical equipment – The MI element lists six broad equipment categories (i.e. vessels, piping systems, relief/vent devices, emergency shutdown systems, controls, and pumps) that are required to have an MI program. The preamble to the PSM standard extends this coverage to “critical” process equipment that is not covered by the six categories. However, the PSM standard does not define what “critical” process equipment is, and thus OSHA is considering defining it in paragraph (b) of the PSM standard as well as amending paragraph (j) to ensure that the “critical equipment” requirement is explicitly codified in the MI element.
  • Clarifying paragraph (j)(5) to better explain “equipment deficiencies” – An MI program requires that employers correct equipment deficiencies that are outside of acceptable operating limits, which are defined in the PSI for the process. However, OSHA acknowledges that this requirement and the exact definition of “equipment deficiencies” have been misunderstood, so they are considering clarifying their intention.

Management of Change (MOC)

  1. Clarifying that paragraph (l) includes organizational changes – The MOC element requires an MOC procedure to be followed for any changes to PSM-covered process equipment, chemicals, technology, and procedures that are not “in kind”. OSHA is considering extending MOC coverage to include organizational changes to ensure that the employer is able to maintain an adequate PSM program amidst management restructuring, employee turnover, or other changes that affect the resources and attention devoted to a PSM program.

Incident Investigation

  1. Amending paragraph (m) to require root cause analysis – The Incident Investigation element requires employers to investigate incidents and near misses with catastrophic potential. There is no specific incident investigation methodology referenced in the standard, but OSHA is considering adding a requirement for employers to perform some form of root cause analysis for PSM incidents and near misses.

Emergency Planning & Response

  • Revising paragraph (n) to require coordination of emergency planning with local emergency-response authorities – The PSM standard currently requires employers to develop a sitewide emergency action plan in accordance with OSHA’s Emergency Action Plan standard (38) and also comply with OSHA’s Hazardous Waste Operations and Emergency Response standard (1910.120), if applicable. However, there are limited references in those standards that require coordination with the local emergency response officials that the site has identified in their emergency action plan. OSHA is considering adding a requirement to the PSM standard that requires some form of coordination with these emergency response officials, potentially similar to the existing requirement in the EPA RMP standard for periodic field and tabletop drills.

Compliance Audits

  • Amending paragraph (o) to require third-party compliance audits – OSHA is considering adding a requirement to the Compliance Audits element of the PSM standard to require some level of third-party involvement.

Holistic PSM Program

  • Including requirements for employers to develop a system for periodic review of and necessary revisions to their PSM management systems (previously referred to as “Evaluation and Corrective Action”) – Akin to action trackers for PHA and compliance audit recommendations, OSHA is considering requiring employers to evaluate and track corrective actions pertaining to their PSM program as a whole. These programmatic corrective actions could come from employee suggestions, PHA recommendations, incident investigations, or other elements of PSM that seek to improve the management structure of the PSM program in ways that currently are not codified in the standard.
  • Requiring the development of written procedures for all elements specified in the standard, and to identify records required by the standard along with a records retention policy (previously referred to as “Written PSM Management Systems”) – There are certain elements of PSM, such as Employee Participation and MOC, that require written procedures – but not all elements require this. Additionally, there are some elements that have explicit document retention requirements, such as Incident Investigations and PHA, but there are also “hidden” document retention requirements for certain elements that must be met for reference purposes during PHA revalidations and compliance audits. For instance, although the PSM standard states that hot work permits must be be retained “until completion of the hot work operations,” these completed permits must also be available to review during compliance audits every three years, so they must be retained at least until the next audit as a best practice. OSHA is considering requiring employers to have written procedures for all PSM elements as well as a formal document retention policy to clear up ambiguity surrounding those requirements.

OSHA has not yet announced a timeline for when these proposed changes are expected to be up for review, so as of now it is unclear which proposed changes will take effect or when the changes will take place.

If you need help understanding how these potential changes to the PSM standard may affect your site, contact our trusted professionals today – and stay tuned for a follow-up article summarizing the proposed changes to the EPA RMP standard as well.

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