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How Risk Management Planning Can Save Your Facility

If an emergency strikes your facility, do you have plans in place that can minimize damage and liability to the company? What emergencies could happen?

Recently Houston fire officials determined that a blast at a facility in West Houston caused by a propylene leak destroyed the facility, caused damage to more than 200 homes, and killed two people. Propylene — a chemical regularly used at the facility and many other similar facilities — is a hazardous chemical covered by several federal environmental and worker safety regulations. If a company stores more than 10,000 pounds of propylene, it is required to file a Risk Management Plan (RMP) with the Environmental Protection Agency (EPA). The company in question had no RMP filed with the EPA, although the facility exceeded that amount for the chemical.

As mentioned in our previous blog, hurricanes, floods, water inundation, dangerous gas leaks, explosions, and everything in-between occur regularly in the U.S. and across the world. Houston and the Gulf Coast experienced several major chemical explosions and fires in the last year alone. RMPs help businesses prepare for what may go wrong in smaller events (e.g., small spills, injuries, chemical releases), or large events such as these.

Provisions for facilities that require an RMP:

•  The RMP Rule was built upon existing industry codes and standards. It requires facilities that use listed regulated Toxic or Flammable Substances for Accidental Release Prevention to develop an RMP and submit that plan to EPA.
•  Facilities holding more than a threshold quantity of a regulated substance in a process are required to comply with EPA’s Risk Management Program regulations.
•  The rule includes a List of Regulated Substances under section 112(r) of the Clean Air Act, including their synonyms and threshold quantities (in pounds) to help assess if a process is subject to the RMP rule.
•  Regulated substances are also subject to the requirements of the Clean Air Act’s general duty clause.

The RMP Rule specifically requires facilities that use extremely hazardous substances to develop an RMP which:

•  Identifies the potential effects of a chemical accident
•  Identifies steps the facility is taking to prevent an accident
•  Spells out emergency response procedures should an accident occur

While not specifically mentioned by emergency responders, the presence of more than 10,000 pounds of propylene also triggers the Process Safety Management (PSM) requirements of the Occupational Safety and Health Administration (OSHA), which has similar requirements as EPA’s RMP rule, except the focus is on worker safety.

Companies that are not required to have an RMP or PSM program are usually required to submit a Tier II Chemical Inventory Report, which aids local responders during an emergency. Events in the last year, such as the Intercontinental Terminal Company fire and the West Houston explosion, emphasize the utility of this compliance information for firefighting personnel and the public. Tier II information is specifically useful when battling chemical fires. The facility should have listed the propylene on their Tier II chemical inventory report, and firefighters and the local community should have been notified that this facility handled this material and in what capacity.

Would the explosion have been prevented if the facility had these plans?

If the facility was compliant with EPA’s RMP standard, they would have conducted a Process Hazard Review to identify potential scenarios and evaluate the safeguards needed to minimize risk. The addition of propylene on the Tier II inventory report may not have prevented the accident but would have provided the opportunity for local emergency responders to prepare for such an event. Additionally, having a well-tuned compliance program could have helped identify the risk of a leak and prevented it before it reached the size that ultimately led to the destruction of the facility and multiple fatalities.

What happens if you fail to report?

If you have a catastrophic event, it is inevitable that emergency responders and regulatory agencies will discover non-compliance. The Local Emergency Planning Committee (LEPC) can file a civil suit and the EPA or State can assess fines for failure to report. Additionally, state regulators have stated their intention to ramp up inspections to identify non-compliance with Tier II reporting. This means that facilities fortunate enough to avoid a catastrophic event still have the potential to face regulatory action.

Ultimately, the fallout from an emergency event can haunt a company for years after. RMPs, PSM programs and Tier II reports are relatively inexpensive to implement, and utilizing them can stimulate productive conversation about what chemicals are used, if they’re necessary, and if using them at a capacity that requires an RMP, PSM program, or Tier II reporting is appropriate.

For additional information or a help with Tier II reporting or Risk Management Plans, please give us a call or click the link below to fill out our Contact Us form.