M
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CURRENT PRACTICES IN HANDLING HAZARDOUS CHEMICALS
\
IN THE CHEMICAL INDUSTRY
A Report for the MIC Task Force
P,rogram Evaluation Division
6'ffice of Management "Systems and Evaluation
March V "1985 " -
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EXECUTIVE SUMMARY
This report describes the current safety practices in the
chemical manufacturing industry and the framework of
federal, state, and local laws that guide those practices,
particularly those intended to prevent sudden, catastrophic
releases of hazardous substances. The information in
the report is based primarily on discussions with two
large, multi-facility chemical companies and two small,
single-plant firms, supplemented by interviews with two
states and representatives of the insurance industry.
In general, the external requirements that control and
monitor the safety practices of the chemical industry
are very limited in scope and in depth. Requirements
intended to prevent releases of hazardous materials,
primarily under EPA or state air permitting programs,
focus on controlling continuous or routine emissions fron
normal operations, rather than on unintended releases.
Regulations intended to minimize the effects of an accident
through emergency response measures focus on in-plant
effects and worker protection, and generally do not address
releases that affect the surrounding community.
One exception is the regulatory framework governing the
transportation of hazardous materials. DOT regulations
are fairly comprehensive, particularly for acutely
hazardous materials, prescribing packaging and labeling
for hazardous materials in transport, and design standards
for certain transport vehicles.
No external agency or entity now conducts a comprehensive.
evaluation of the chemical process itself to determine
whether it is designed and operated properly, and whether
back-up systems and emergency procedures are adequate.
Nevertheless, the chemical companies take extensive pre-
cautions to prevent accidents and releases that go far
beyond what is required by law. The companies' principal ,
motivations for these voluntary actions are:
- Concern for corporate profitability and employee morale;
A well-run plant with few accidents is more profitable,
and an employee with confidence in the safety of his
work environment is more productive.
- Concern for financial loss due to property damages,
loss of use, or liability claims; Most companies self-
insure for a large portion of their potential costs,
which translates to direct financial loss for damages
when accidents occur. Costs due to liability for
damages from product use, worker injuries, and environ-
mental impairment, or damage occurring outside the
plant, can be significant.
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TABLE OF CONTENTS
KNTRODUCTION
Page
1
Sources of Information
Control ^Points in the Manufacturer
and Marketing of Chemicals
Impact of Insurers on Safety Behavior
CHEMICAL HAZARD EVALUATION
(Under each of the following headings as appropriate)
Federal Controls
State Controls
Local Controls
Insurer Controls
Industry or Engineering Standards
Large Company Practices
- Small Company Practices
SITING
PROCESS AND EQUIPMENT DESIGN
CONSTRUCTION
PROCESS OPERATIONS AND MAINTENANCE
EMERGENCY RESPONSE
8
12
13
15
PRODUCT MARKETING
17
TRANSPORTATION
POSTSCRIPT ON BHOPAL
18
19
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Concern for insurabilityand insurance costs; A company's
ability to obtain insurance against risks and the size
of the premiums depends on its accident and loss record.
The large companies devote considerable resources to
hazard evaluation, process design and safety features,
employee training, and internal inspections to ensure
equipment is in proper working condition and operating
procedures are followed. The companies conduct extensive
analyses to ensure a new process will operate safely,
hypothesizing possible events and equipment failures, and
building in back-up systems, response mechanisms, and
procedures to reduce the possibility of accidents and
resulting damages when accidents occur.
By contrast, the small companies have far fewer resources
available for safety assessments. They generally do not
have formal safety review and evaluation systems in place
like those used by the larger firms, and tend to rely on
suppliers and published sources of information for hazard
data. They depend more on local authorities for fire-fighting
and other emergency response services, while large plants,
for the most part, are self-sufficient.
However, neither of the small companies interviewed handles
extremely hazardous materials. They know the limits of
their equipment and expertise and will not produce or
use chemicals with hazards they are not equipped to handle.
Moreover, the small companies generally use and produce
relatively small quantities of chemicals. They sell
almost exclusively to large chemical firms, who use
the small chemical manufacturers when they need only a
limited amount of a specific chemical that is not econom-
ically feasible for them to produce.
The small firms use batch processes and specialize in the
manufacture of a limited range of related chemicals. They
know the handling characteristics and potential hazards
..of these chemicals well.
Both of the large firms have undertaken intensive self-
evaluations in response to the catastrophe at Bhopal.
They are identifying the chemicals they use that have the
potential for serious effects if a release were to occur
and inspecting their plants and procedures to ensure they
are adequate. In addition, one of the small firms has
joined with several of its neighboring plants to work
with local authorities to develop emergency procedures.
They also intend to evaluate the safety practices of each
of the participating firms.
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Current Practices in Handling Hazardous Chemicals
in the Chemical Industry
INTRODUCTION
Chemical manufacturers operate within a framework of
federal, state and local laws that guide many of their safety
practices. A number of incentives - concern for insurability,
avoidance of liability, and worker safety and morale - encourage
companies to go beyond the minimum required by law. This report
examines current safety practices in the chemical industry that
affect the chance of an accidental, catastrophic release of a
hazardous chemical to the environment or the potential impact of
such a release. It also discusses the internal and external controls
intended to ensure that companies behave responsibly in handling
dangerous chemicals.
Sources of Information
The report is based primarily on interviews with officials of
four chemical manufacturing companies: two large companies with
many domestic and overseas plant sites and two small, owner-operated
companies with single plants. The large companies are among in
the top five in chemical production, with annual sales of more
than S5 billion. One company manufactures basic chemicals only,
while the other produces both end-products and basic chemicals.
Both have large safety departments in corporate headquarters that
design new processes and safety systems and oversee safety practices
in individual plants.
Each of the small companies that were interviewed have annual
sales of $4 to $10 million, or a hundred-fold less than the major
companies. Both companies produce specialty chemical intermediates,
usually in small quantities (one company manufactures a maximum of
40,000 pounds per chemical product, the other 100,000 pounds, and
both might produce as little as one pound of a given product).
The companies use batch processing to manufacture a variety of
related chemicals: one company specializes in variations of long
chain, saturated alkanes, brominated alkanes, and alkenyl succinic
anhydrides; the other in intermediates for pharmaceutical chemicals.
In general, the feedstocks and products handled by these two firms
did not have extremely hazardous properties; flammability and
chronic effects, like potential carcinogenicity, are the properties
of greatest concern.
Small chemical producers occupy a valuable niche in the chemical
manufacturing field: they specialize in certain classes of chemical
products and produce volumes too small to be economically feasible
for large companies with their dedicated equipment and large bureau-
cracies. Both small companies interviewed sell almost exclusively
to large chemical manufacturers.
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In addition to consulting with chemical manufacturers, we
talked to several state agencies in two states to supplement
information provided by the companies on state and local regulations
We also met with a representative of the insurance industry to
discuss that industry's influence on safety practices.
Control Points in the Manufacture and Marketing of Chemicals
This discussion covers eight areas where external controls
and internal decisions about safety systems and precautions affect
the liklihood of catastrophic release similar to that which occurred
in Bhopal. These are:
o Chemical hazard evaluation
o Siting of a new chemical plant or process
o Process and equipment design
o Construction
o Process operations and maintenance
o Emergency response
o Product marketing
o Transportation
In each area, we discuss federal, state, and local laws that
control or influence company decisions, the role of other outside
forces, and the companies practices and motivations.
The discussion of federal laws that regulate chemical companies
primarily covers laws and authorities mentioned by industry repre-
sentatives in our interviews, and therefore is not a comprehensive
or exhaustive list of all the federal laws that might influence
company behavior. A more complete analysis of federal statutes
and regulations is covered in other work conducted for the Task
Force.
Information presented here on controls at the state and local
level is derived from discussions with two states and with the
industry representatives. While we have tried to reflect the
situation in states and localities generally, some states and
local authorities may have somewhat different laws and concerns
than those described here.
Impact of Insurance on Safety Behavior
Concern for liability and insurability influence company
behavior in all of the areas listed above. All firms insure to
some extent against property damage, worker compensation claims,
and product liability. Many carry other types of liability
insurance as well.
The current situation in insurance creates strong incentives
for companies to take actions to reduce the risk of accidents.
First, premium costs are based on a company's past safety record.
A firm can significantly reduce insurance costs by lowering its
accident rate. Moreover, a company with an unusually bad accident
history faces loss of insurance coverage.
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Second, many companies self-insure for a portion of their
potential damage or liability costs, building predictable losses
into their operating costs. This practice of self-insurance thus
translates into direct financial loss to the company if accidents
occur. A large company may self-insure for up to the first $50
million in damages, carrying only catastrophic insurance coverage
for claims that exceed that amount.
Third, insurers influence a company's safety practices directly
by inspecting a plant when a policy is first issued and often
requiring certain safety practices as a condition of the policy.
Fourth, liability insurance for sudden or accidental releases
outside the workplace boundaries, called "environmental impairment
liability," is becoming increasingly difficult to obtain. A company
must seek to minimize this kind of risk to prevent bearing the full
amount of any financial loss if it cannot obtain insurance.
CHEMICAL HAZARD EVALUATION
In order to design and operate a safe process, the company
must first know the hazards of the chemicals it uses and produces.
This may involve testing new chemical products in the research
phase with an eye toward future product liability, or evaluating
the hazards of feedstocks and intermediates to assess whether a
product can be made safely.
Federal Controls
o Under the Toxic Substances Control Act (TSCA) EPA reviews
available data on new chemicals to ensure they will not
present unreasonable risks. Although it focuses on the
properties of proposed new chemicals, EPA can also assess the
hazards of the production process. It can impose a variety
of controls on the manufacturer, ranging from testing and
worker safety precautions, to a total ban on production.
o Under the Federal Insecticide, Fungicide and Rodenticide Act
(FIFRA), EPA reviews and registers pesticide products, weighing
the risks of each product against its efficacy. EPA evaluates
only the product and its use and does not have authority to
consider the hazards associated with its manufacture.
o The Occupational Safety and Health Administration (OSHA) has
set permissible exposure limits (PEL) in the workplace for
some 400 chemicals and developed comprehensive standards for
an additional 22.. To use or produce these chemicals, a
manufacturer must design a process that ensures levels in the
workplace will be below the PEL.
o OSHA has also recently promulgated a hazard communication
standard, or "right to know" regulation, effective in November
1985. It requires manufacturers to develop hazard information
on all their products and transmit that information through
labels and material safety data sheets (MSDS) to their workers
and industrial customers.
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o The Department of Transportation (DOT), under the Hazardous
Materials Transportation Act, places labeling, packaging and
other requirements on chemicals with certain hazard properties
while in transport. To comply with DOT regulations, a manu-
facturer must know if his chemicals fall into one of DOT's
hazard classes.
St^ate Controls
o Pew if any states have laws that specifically require companies
to test their chemicals for hazards, and most states do not
know the chemicals in use in their states.
o However, both states we interviewed recently passed "right to
know" laws, similar but broader than OSHA's, that require all
employers to transmit chemical identity and hazard information
to their users and to the state. In one state, the law applied
to all chemical products; in the other, it applied to a list
of over 800 chemicals developed by the state. Laws like
these indirectly encourage testing to identify hazards,
although the two states did not know whether more testing was
actually taking place.
o The question of preemption of similar state laws by the new
OSHA hazard communication law has not yet been settled.
Large Company Practices
o Testing to evaluate the hazards of a proposed chemical and
the intermediates involved in its production begins at the
research phase and continues throughout process development.
Nearly all chemicals used or made in the process are tested
to determine their physical properties, such as flammability
and corrosivity, and acute toxicity. A series of short-term •
tests for chronic effects like mutagencity and teratogencity
are also run on most organic chemicals. The results of these
tests determine what the controls and safety procedures used
in the production process will be.
o The company may decide not to proceed with >the development of
a new product if the results of the hazard evaluation indicate
that the process may create serious, uncontrollable hazards.
The company will first seek a substitute chemical or a safer
synthesis route. If no workable alternative is found, product
development may stop.
- One company decided not to produce a pesticide that it found
was capable of producing irreversible eye damage. The company
believed there was no way of guaranteeing that applicators in
the field would be protected.
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o New hazard information on a chemical already in production
has also affected company decisions.
A solvent used in making a pigment was found to be a mild
carcinogen. Although carefully handled, it was produced
.in very large quantities. The company believed the solvent
presented an unacceptable risk to its employees and stopped
production of the pigment.
Small Company Practices
o While the large companies conduct extensive hazard testing on
the chemicals they use and produce, the small companies primarily
use hazard data developed by others. They rely on literature
searches of scientific journals or public data bases to assess
the hazards of unfamiliar chemicals. They also obtain infor-
mation from chemical suppliers, although there is considerable
variation in the quality and completeness of the information
provided.
o The small companies treat "new" chemicals, those subject to
EPA review under TSCA, quite differently from existing ones,
even those that are new to the company.
- One company hires outside labs to test new chemicals for
their acute hazard properties and frequently for chronic
hazards using an Ames test. Although such testing is not
required, the company prefers to have EPA review real
hazard data rather than have to rely on an assessment of
structural analogs.
The company usually decides not to manufacture a new
chemical if tests results indicate potential hazards. It
will not manufacture a chemical, for example, if the Ames
test is positive. It makes this choice less from concern
about the product than concern about costs and "hassles"
associated with the premanufacture notification (PMN)
process at EPA.
.. - Whether or not a chemical is "new" plays an important part
in the other company's decision to accept an order. If
the chemical will be subject to a PMN, the company will
negotiate with its customer, generally a large company,
concerning submitting the notice and developing hazard data.
SITING
The physical location of the plant facility is an important
factor in determining the amount of damage or harm that results if
an environmental release occurs. The more remote the location,
the less the. impact will be. However, the primary factors affecting
a company's siting decisions are financial and administrative,
rather than environmental.
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Federal Controls
o The most significant external constraints on siting are those
imposed by the air permitting program under the federal Clean
Air Act and administered by EPA or the states.
Prevention of Significant Deterioration (PSD) requirements
are the most constraining because of the delays involved.
No construction can begin until a pre-construction permit
is issued/ which requires a year of background ambient
data for site, extensive modelling, and lengthy review
time by the permitting agency. Because EPA and the states
share review responsibilities, additional time may pass as
they resolve differences.
State Implementation Plan (SIP) requirements in non-
attainment areas tend to be less constraining. A company
wanting to locate in a given area must find an existing
source with similar emissions for an "emissions trade."
Delays can occur if a state or local agency asks for
identification of the specific components of any volatile
organic compounds (VOCs) to be emitted and insists that
those traded be of comparable toxicity and volatility.
State Controls
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o Generally, most states can only exercise control over siting
of new facilities through their air or water permitting programs,
although there are exceptions. For example. New York requires
a state-level environmental impact statement for every new
facility or significant modification to an existing facility.
Local controls
o Most local authorities have final control of facility siting
through land use planning and zoning laws. This can be a
significant constraint in some states and localities, but
most local governments welcome new industrial facilities
and the jobs they bring, and willingly modify zoning plans
. to accommodate proposed new facilities. ,
o In general, zoning is a problem only for new facilities; it
is less of an issue if an existing facility is expanded or
modified. One state pointed out that a company can build a
new facility in an area already zoned for industrial develop-
ment without applying to the local zoning board. In that
state's older cities, heavy industry is often located adjacent
to residential areas.
o All communities have load limits on feeder roads, and some
have restricted routes for hazardous loads. These controls
generally have not been a significant constraint for the
reason cited above: a locality will normally take the necessary
measures to accommodate a proposed new facility.
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Large Company Practices
o The large chemical companies, with many plant sites to
choose from, usually adapt existing facilities or build new
plants on existing sites to accommodate new chemical processes.
Decisions on location of the new process are based not on
concerns about the proximity to population, but on economic
and managerial considerations.
o One company said it rarely opens a new plant site anymore,
but modifies its operations at an existing site. Decisions
about location are made early in the development process and
are based on factors like the adaptability of existing equipment,
proximity to raw materials and markets, and availability of
qualified personnel.
o The other firm had specific guidelines for siting new processes
that take similar factors into account.
- Use of existing facilities. The company prefers to adapt
an existing plant if there is one that can accommodate the
new process.
- Transportation cost. The process is located to minimize
transportation costs of raw materials and finished products.
Proximity to consumers is usually weighed more heavily
because transportation costs are for finished products are
usually more than those for raw materials.
Total size, complexity of the facility. The company
believes a facility can be too large and complex to be
manageable. When considering an expansion, it assesses
whether the expanded facility will be within the ability
of a plant manager to oversee it. The company noted,
however, that other chemical companies prefer to locate
all their facilities in one place.
- Availability of a qualified labor pool is a consideration
in siting a new facility. The company takes into account
amenities in the community that will make it attractive to
employees, such as good local schools and educational
institutions for professional training.
- The potential impact on ground water is a new, major concern
in siting new facilities. In the future, the hydrogeology
of a proposed new site will be an important factor in site
selection.
o In the past two decades, this company has made it a policy to
acquire an excess of land beyond what is needed for the plant
itself. If a facility requires tens of acres, the company
acquires thousands of acres. It creates this sizeable buffer
zone primarily for aesthetic reasons, a response to recent
local concerns about the visual impact of industrial facilities.
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o Beyond its policy of acquiring excess land, the company does
not deliberately site plants away from residential areas,
because it recognizes that no site will remain remote; new
residential areas will inevitably be built to accommodate
employees who want to live nearby. It believes that its
safety measures to protect plant employees, who would be
affected first if an accident occurred, are adequate to protect
the surrounding population.
Small Company Practices
o Siting a new facility is not a concern of the small companies
we interviewed, who operate single plants and have no plans
to expand. They did mention, however, that adequate utilities
and access to a nearby hazardous waste disposal facility are
important considerations. Transportation costs for feedstocks
or products are less important to the small firms, which deal
with relatively small quantities.
PROCESS AND EQUIPMENT DESIGN
Design of the chemical process involves choosing pathways and
operating parameters, and selecting the appropriate equipment to
produce the product in the most efficient and safest way possible.
At this point, a company will usually have obtained chemical
hazard information that determines what safety features and backup
systems are needed to ensure a safe operation.
Federal Controls
o EPA influences process and equipment design, directly or
indirectly, through its pollution control programs in air,
water, and hazardous waste. Requirements to control air
pollution probably have the greatest impact on design features
related to environmental releases, but, even in this program,
the focus is on continuous, anticipated releases, not on
accident prevention.
Limits on air emissions affects the design of scrubbers
and of valves and .seals to minimize fugitive emissions.
- The increasing costs of hazardous waste management under
RCRA requirements provide an incentive for companies to
design or modify their processes to reduce the volume of
wastes generated, and to recover and reuse more of the
wastes that are generated.
A company may need to install special equipment or modify
its process to comply with permit limitations on its
wastewater discharges.
o Two types of OSHA requirements affect process design:
- Permissible exposure limits and maximum allowable con-
centrations for certain chemicals, which may require some
processes to be enclosed;
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Standards for potential safety hazards, such as those
covering the handling of flammable and combustible liquids;
reactive and unstable liquids; and the design, installation
and operation of storage tanks.
State Controls
o The state is likely to have the greatest impact on process
design through its air permitting program for proposed
facilities. Many states now require facilities to meet
EPA-developed draft RACT (Reasonably Available Control Tech-
nology) guidelines for volatile organic compounds. One state
requires new facilities to meet Best Available Control Tech-
nology standards, which go beyond federal requirements. In
making permitting decisions, it reviews the engineering design
and proposed operating procedures prior to construction. It
also has information on all chemicals used in the plant, as
well those that may present emissions problems. It does not,
however, require existing facilities to meet these standards
unless the facility has a very serious pollution problem.
o Virtually every state requires that pressure vessels meet
ASME {American Society of Mechanical Engineers) standards.
There are separate standards for fired pressure vessels, or
boilers, and unfired pressure vessels, or pressurized storage
tanks. The state usually inspects fired pressure vessels
when first installed, with periodic checks thereafter to make
sure all such equipment has the ASME seal on it. Unfired
vessels are generally inspected only at the time of installation,
Local Controls
o Although local building codes apply to chemical plants, they
are intended mainly for homes, apartment buildings, and com-
mercial buildings. There is little in these codes applicable
to chemical plants design, although there are some exceptions.
For example, there may be local requirements that internal
electrical lines be placed in conduits.
o ' One company said that local authorities rarely inspect its
chemical plants to assess compliance with the building code.
Instead, the company "certifies" that the design complies
with the applicable portions of the code. If an inspection
is conducted, it is done only when the plant first goes into
operation.
o The National Fire Protection Association (NFPA) has developed
a model code addressing the storage and handling of flammable
materials. The NFPA Code addresses such matters as:
- the amount of certain materials that may be stored in
a single container, including fixed tanks and drums.
the minimum spacing between such containers.
- required fire protection equipment at a facility, given
the quantity and flammability of the materials present.
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o Approximately one-third of the 14,000 local code-setting
authorities (i.e., counties, townships, cities, etc.) require
facilities to follow the NFPA code. Some facilities are
inspected by the fire marshal for conformity with the code;
others are not, especially those that are self-sufficient in
terms of fire protection.
o In one state, a plant is required to have a license to store
flammable materials, issued by the local fire marshall.
However, a license, once issued, is transferable, and the
practices of a new license holder are not subject to review.
Industry or Engineering Standards
o There are many voluntary industry standards developed by
committees of industry experts that cover a variety of aspects
of plant engineering, design, and maintenance. They include,
for example, the construction and maintenance of electrical
equipment, piping, valves, and storage vessels and standards
specific to the petroleum industry. There are also standards
for handling and transport of chlorine. (See attachment for a
list of industry standards.)
o These standards are revised periodically. For example, the
National Electrical Manufacturers Association standards are
revised every 3 years, with opportunity for review and comment
from the entire Association membership, a process that takes
two years to complete.
o Most companies follow these standards unless there is a
compelling reason to modify them. Some standards, like the
NFPA, are incorporated into state or local law. Even where
compliance is not required, the standards are widely used to
ensure safe practices and satisfy insurers.
Large Company Practices
o Design and evaluation of a new process begins in the research
stage, where the chemical process and operating parameters
are laid out, and moves to engineering analysis, which designs
•-the equipment and process flow to produce »the chemical. At a
very early stage, safety assessments come into play, which
look at the need for special equipment or backup systems to
ensure the system can be monitored and managed safely. One
company uses a project team to develop a new process, which
includes safety specialists to ensure safety concerns receive
full attention.
o For each new process or significant modification, the companies
conduct extensive analyses identifying possible events that
could lead to accidents, informally called "what if" analysis.
The analysis identifies the consequences and possible responses
to such events to ensure they will be resolved safely.
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o One company conducts a formalized, quantititive fault-tree
analysis, called "Process Hazard Assessment," that may take
6 months to complete. It uses a strict operational definition
of "acceptable risk," defined as one serious accident over a
period of 300 to 600 times the projected life of the facility.
Thus, if a process is expected to be in operation 40 years,
it will take measures to reduce the risk of a serious accident
to once every 12,000 to 24,000 years. Even mining process
modifications are subjected to an explicit hazard analysis,
though a less quantitative one.
o The companies rely heavily on fail-safe designs for each
process component, which means if the component fails, it
will fail in a way that does not impair safety. For example,
valves are designed to remain open or closed, whichever is
the safer condition, if the process that activates them shuts
down.
o The companies rely heavily on "redundancy," or backup
systems, to reduce risks. For example, tanks where pressure-
creating reactions are possible may be designed with two
independent pressure relief valves as well as a separate
rupture disk, which ruptures at high pressure, to guard against
multiple failures in the valves. One company that uses a
computer system to monitor and control the chemical reaction
has a backup computer in case the main system goes down.
o Companies have developed their own internal standards for
certain items. For example,
- One company developed its own design for safety showers
for any new safety showers installed in its facilities.
A company decided the standard design for tank cars for
three chemicals (metallic sodium, hydrogen cyanide, and
tetraethyl lead) did not provide what it considered to be
an adequate degree of protection. It developed more
stringent, specialized tank car designs for each substance,
now in use for 15-20 years. Although some of these cars
have been involved in serious rail accidents, there has
never been a loss of material from any 'of the cars. One
tank car containing sodium was involved an accident that
knocked it off a barge to the bottom of a river. It was
hoisted up two days later without any sodium being released.
Metallic sodium reacts so violently with water that an
violent explosion would have occurred had the tank car
ruptured.
Sma11 Company Practices
o Process design for the small companies involves a deter-
mination of whether a new chemical requested by a customer
can be safely produced with existing equipment. Rather than
designing an entirely new process and new equipment, they
limit their production to related chemicals that are
appropriate for their equipment and expertise.
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o One of the factors important in that determination is the
hazards of the chemicals used and produced in the process.
If the process involves acutely hazardous chemicals that the
company is not equipped to handle, it will generally not
accept the order. In seven instances last year, one company
decided the process was too hazardous for its operations and
decided not to produce the chemical.
CONSTRUCTION
After the process is designed, the plant must be constructed
in conformance with the approved design.
Federal Controls
o There is no federal oversight of construction other than
to ensure the safety of the construction workers. No
inspections are conducted to ensure the facility is
properly constructed.
S t a te Con t roIs
o While states do not have specific construction standards,
some states do conduct inspections of newly-built facilities
under air permitting programs.
Local Controls
o Some local jurisdictions inspect new facilities to assess
whether they meet building codes. As discussed previously,
the scope of the inspection is limited.
Insurer Controls
o An insurance company often inspects a facility when it first
insures a plant or new process against property damage, except
in cases where the size of the premium or coverage is not
large enough to justify the cost of inspection. Insurers may
also be consulted when a plant is being designed. The inspector
looks at all aspects of equipment and design, assessing the
chemical hazards and provisions made to prevent or mitigate
risks, although the effectiveness of the inspection varies
depending on the expertise of the inspector. The insurance
company may require changes or additional controls as a
condition for insurance.
Industry or engineering standards
o These standards specify design, but generally do not indicate
what steps should be taken during construction of a facility
or fabrication of a piece of equipment to ensure that the
design specifications are met.
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Large Company Practices
o One company managed all facility construction in-house, using
its own construction managers to supervise local construction
workers, to ensure that the plant is built according to its
specifications. The other company hired outside construction
firms like Bechtel, which it believed had superior expertise.
o The companies conduct extensive evaluations of a new facility
and run start-up tests before moving into full production.
o Routinely, the companies test critical components that will
be exposed to highly reactive materials or high pressures
to ensure they meet specifications before they are installed.
A company may also inspect the operations of suppliers of
critical components or change suppliers if they have quality-
control concerns.
Sma11 Compan ie s Pract i ce s
o Small companies rely on outside contractors if construction
is needed. One interviewee expressed concern about this step,
because small firms usually do not have the expertise to
evaluate the quality of the construction work or the materials
used.
PROCESS OPERATIONS AND MAINTENANCE
No matter how well-designed, a chemical process must be managed
and run properly in order to operate safely. Equipment and safety
systems must be maintained in proper working condition to ensure
they operate as intended.
Federal Controls
o EPA inspectors periodically check process equipment for
fugitive emissions violations, including evaluations of valves
and seals, and examine pollution control equipment to ensure
it is working properly.
o OSHA conducts periodic safety inspections,' which focus primarily
on physical hazards, such as heat and moving parts in machinery,
and on the condition of safety equipment, like safety masks
and fire prevention equipment. It conducts random inspections,
and also targets inspections based on injury rates measured in
terms of lost workdays.
o OSHA also conducts health inspections that assess in-plant
concentrations of toxic chemicals for which Permissible Exposure
Limits have been set, again targetting its inspections to
industries with a high rate of past violations. Last year,
OSHA inspected one in every five chemical manufacturing
establishments under this system.
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State Controls
o Many states administer pollution control programs and occupa-
tional safety and health programs in lieu of the federal
agencies. While there is considerable variation among states,
in some cases, these programs are more stringent and inspections
more frequent than required by EPA. For example, New Jersey
has inspectors stationed permanently at certain major facilities,
o Like the federal programs they replace, however, state programs
have a limited and specialized focus, primarily on routine,
continuous emission controls and safety provisions for workers.
They do not review the industrial processes themselves.
Local Controls
o There is little routine inspection of chemical industry facil-
ities by local authorities, other than some inspections by
the fire marshal.
Insurer Controls
o While insurers generally inspect an operation only when the
policy is first issued, they may re-inspect a plant with an
unusually high loss record.
Large Company Practices
o The companies have explicit operating instructions for each
chemical process. These cover normal operating procedures to
ensure reactions proceed as intended and to maintain equipment
in proper condition, along with appropriate responses to
diagnose and correct problems that arise. The procedures are
revised any time the process is modified and are also reviewed
and up-dated periodically even when modifications have not
occurred.
o Routine safety checks are built into the system at the plant
and operator level to anticipate equipment failure and other
problems. In addition, corporate headquarters conducts an
intensive inspection of each plant on a fixed schedule, usually
.. annually, which identifies problems and lapses in plant proced-
ures and makes recommendations for improvement. One company
commented that it is better at documenting the audit findings
than it is the follow-up on recommendations, even though they
routinely make the recommended changes.
o The companies train their supervisors, who train the operators,
on procedures for operating a new process. New employees
also receive extensive training; plant operators, usually
high school graduates, undergo an apprentice period as well.
o The companies track accidents, or "unusual events," and
the handling and outcome of the events. They look for patterns,
which may indicate mismanagment or previously undetected
flaws in the process or procedures, and will make changes
if necessary.
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o Headquarters keeps statistics on several safety indicators,
ranking plants and rewarding managers on safety performance.
The plants report lost workday accidents (when an employee is
unable to come to work because of an injury sustained on the
job) and injuries requiring in-house medical aid.
o The companies place a high priority on safety, which is
reflected in the performance standards of their managers.
Pay increases and bonuses are tied to the safety statistics
and accident rates at all levels of the organization. Operators
who repeatedly violate safety procedures are fired.
Sma 11 Company Pra.ctices
o The small companies interviewed have a less formal system of
maintenance than the large firms, but also conduct routine
inspections in-house. One firm, which operates around the
clock, shuts down for two weeks, twice a year, to perform
non-emergency maintenance and repair.
o The companies run batch process operations; the products
they manufacture change frequently. Equipment is thoroughly
cleaned and inspected between batches, providing a periodic
safety check on the integrity of equipment.
EMERGENCY RESPONSE
Despite preventative measures, accidental releases and spills
inevitably occur. Emergency response actions are intended to
minimize the damage that results from of an accidental release.
Federal Controls
o Many federal agencies have responsibilities for hazardous
releases that occur within their arena. For example, EPA.
requires that releases of certain hazardous, substances over
a specified quantity be reported and has broad authority to
respond to such a release; it also requires hazardous waste
generators to develop contingency plans to minimize the effects
''of a release of hazardous waste. >
o In addition, DOT has requirements covering releases that
happen in transit. OSHA requires companies to have emergency
plans and safety equipment for releases that affect workers.
The Coast Guard responds to spills in navigable waters. The
Department of Interior has authority over releases on federal
lands. And the Nuclear Regulatory Commission covers releases
of radioactive materials.
o The National Response Team is a cooperative effort of all
federal agencies with responsibilities for emergency response.
Co-chaired by EPA and the Coast Guard, the WT monitors
exposure and, working with local authorities, directs contain-
ment and cleanup actions when a release occurs. There are
multi-agency response teams in each Region that can reach the
site of the accident quickly.
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o The NRC requires nuclear power plants and surrounding
communities to have emergency response systems in place,
including offsite control centers, warning sirens, and
community evacuation plans. Although these are intended to
mitigate the effects of a nuclear accident, they have also
been used effectively when chemical spills have occurred
in the vicinity of the plant.
State Controls
o Many states have some system to respond to accidents or spills.
One state had three response teams located around the state.
These teams monitor environmental and health impacts, contain
or mitigate the spill if no local or corporate response is
available, and assist local agencies if the state determines
evacuation is necessary. Although companies are currently
allowed 24 hours to report spills, the state is developing a
20 minute response capability.
o Another state felt its response capability was inadequate.
Its emergency response team is located in the eastern part of
the state and is not able to reach other areas quickly. It
is also designed to deal primarily with oil spills, and is
not as well-equipped to handle chemical releases.
o Neither state required industrial facilities to have contingency
plans for emergencies, beyond what is required for hazardous
waste releases under RCRA, and did not require communities
around industrial facilities to develop response or evacuation
plans.
Local Controls
o Local authorities are the first line of defense in an emergency
situation. In most communities, the fire department has
primary responsibility in the event of an accident, and
provides fire-fighting services to local industries.
o There is considerable variation in the capability of local
communities to deal with disasters. Many^communities do not
have adequate equipment to handle a serious accident nor
workable evacuation plans. Industrial facilities generally
have some arrangement with local authorities in case of an
environmental release and have provided them with limited
hazard information on the chemicals in use in the plant. The
adequacy of these arrangements, however, depend on the initiative
and interest of the community and the facility management.
o NRC requirements for community preparedness in a nuclear plant
emergency illustrates the problems facing local authorities.
As a condition for licensing, NRC requires the community to
have evacuation plans and annual drills, as well as adequate
equipment and personnel to protect the community. Most of
the communities involved do not have the resources to meet
NRC standards; consequently, the nuclear facilities generally
foot the entire bill for the community.
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Large Company Practices
o Most of a company's emergency response measures are aimed at
protecting the facility and its workers. Procedures lay out
responses to foreseeable events, like equipment failure,
fires, and spills. They establish a chain of command for
emergency situations and an on-site command center that allows
the manager to communicate with every part of the plant and
direct emergency actions.
o Large plants are essentially self-sufficent in an emergency.
They have fire fighting equipment on-site, including fire
engines and water storage tanks, in addition to automatic
fire supression systems. Plant employees are organized into
fire brigades in which each employee has pre-assigned respons-
iblities. They also have medical units to treat injured
workers, staffed by full-time paramedics. Emergency drills
are held periodically to train workers and test preparedness.
o Although they have limited interaction with the surrounding
community, the facilities generally have some arrangement
with local authorities for assistance if a emergency grows
beyond their ability to manage it.
Small Company Practices
o While the small companies have some amount of emergency equip-
ment on site, such as fire extinguishers and sprinkler systems,
they rely on local authorities for fire-fighting services
and other assistance in a major emergency. Local authorities
have some information on the chemicals in the plants, although
they often have not formally developed comprehensive emergency
procedures.
o As generators under RCRA, the companies are required to prepare
contingency plans for spills and accidents involving hazardous
waste. One company hired an outside consultant to conduct an
extensive assessment of the plant and prepare complete plans,
and found the results valuable. The company has sent the
draft plan to local authorities for review^ and plans to go
through the plant with them to ensure the contingency plan
can be implemented effectively.
PRODUCT MARKETING _
The risk from hazardous chemicals occurs not only during
production, but also during use. Controls and practices in
product marketing are aimed at ensuring that those who purchase
hazardous materials are able to handle them safely.
Federal Controls
o Under FIFRA, EPA can restrict who can -purchase and use
certain pesticides. Under TSCA, EPA has the authority to
restrict the sale and use of chemicals that it finds present
an unreasonable risk.
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o The Bureau of Tobacco, Alcohol and Firearms restricts the
purchase of explosives.
State Controls
o States can further restrict pesticide use beyond what is
required under FIFRA, but few have actually done so.
Large Company Practices
o Concerned in part for product liability, a company may reach
beyond its boundaries to ensure that customers handle and use
their products safely. For especially hazardous chemicals, a
company may visit the customer's plant to evaluate its safety
practices and provide training and assistance on the chemical's
use. It may require, by contract, that the customer follow
certain handling procedures. If not satisfied with a customer's
procedures or performance, the company may refuse to sell the
product.
Small Company Practices
o Since the small chemical producers interviewed sold exclusively
to large companies, they were not concerned about their
customers' ability to handle hazardous products. However,
one company did provide proof that the big firms are concerned
about the capabilities of its customers. After the small firm
had ordered five drums of an highly toxic chemical, a repre-
sentative from the supplier appeared at the company to find
out what it would be used for and how it would be handled.
TRANSPORTATION
Accidents during transport are a frequent source of environ-
mental release. Considerable quantities of hazardous materials
can be released if a tank truck or rail car is damaged.
Federal Controls
o Under the Hazardous Materials Transportation Act, DOT has
extensive requirements governing the transport of hazardous
materials, focusing primarily on those with acute hazards.
First, DOT provides information during transport: it requires
shipping papers showing the identity, hazard class, and amount
of hazardous material, and container labels and vehicle placards
identifying hazards. It also specifies manufacturing require-
ments for containers and rail tank cars. In addition, DOT
has banned the transportation of certain materials, and
others must be approved before they can be transported.
o While DOT views emergency response as primarily a local
responsibility, it supports local efforts through a widely-
used guidebook with information on response and through the
National Response Team.
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State Contro1s
o Some states restrict transport of flammable and explosive
materials on certain urban routes and on bridges and tunnels.
o States can be delegated enforcement authority of transportation
regulations.
Industry Practices
o The Chemical Manufacturing Association maintains an emergency
response center called CHEMTREC that provides response
information for chemical spills and releases. CHEMTREC
provides a 24-hour liason service with member companies,
relaying information in an accident on the chemicals involved,
response procedures, and first aid.
Company Practices
o Companies generally follow DOT requirements and design standards,
but in some cases may go beyond federal requirements. (See
section on Process and Equipment Design).
o Many large companies have a 24-hour emergency number to provide
hazard, clean-up and first aid information for transportation
accidents involving chemicals they produce. Some companies
have staff available to respond on scene to major accidents.
POSTSCRIPT ON BHOPAL
During our interviews, we occasionally were told of activities
that a state or company had undertaken in response to the
catastrophic accident in Bhopal. Their concern was that it not
happen here, and that it not happen to them.
State Actions '
o One state has created a Chemical Safety Task Force composed
of representatives from state and local government, the chemical
industry, labor, and public interest groups. The purpose of
the Task Force is to examine current safety practices and
existing laws in order to determine whether additional legis-
lation is needed to protect against catastrophic accidents.
To support the Task Force, the state is conducting intensive
chemical safety audits in six plants and is holding a series
of public meetings to hear community concerns and provide
information.
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-20-
Large Company Actions
o Both of the companies had undertaken special self-investigations
to assess the adequacy of their procedures in preventing
significant, accidental releases of highly toxic chemicals.
One company required its plants to identify the chemicals in
use that, considering hazardous properties, volumes, and
worst case scenarios, could potentially result in a significant
release. It then intended to take a hard look at the way
those chemicals were handled.
o One company intended to make public the identity and the
hazard properties of the chemicals in use in the plant and
hold informational meetings for the surrounding communities
on the systems it uses to ensure its chemicals are handled
safely.
Small Company Actions
o One company has joined with 12 of its neighboring industrial
facilities to develop emergency plans and improve handling
procedures. In phase I, the companies will develop plans
that include certain elements, prepare maps for each facility
that show the location of acutely hazardous chemicals using
DOT classifications, and meet with the local fire marshall,
and other local authorities to familiarize them with the
plants and response plans. In phase II, the group plans to
evaluate the chemical process, equipment and and safety
practices of each facility, using experts from a different
facility or outside consultants.
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ATTACHMENT
NATIONAL CODES AND STANDARDS
Aluminum Structures
Specifications for Structures of Aluminum Alloys, The Aluminum
Association
Boilers, Incinerators, Furnaces, Heaters & Burners
American Petroleum Institute
American Society of Mechanical Engineers
Section I, II, IV, V, IX
American Society for Testing and Materials.
National Fire Protection Association
Underwriter Laboratories, Inc.
Buildings
The BOCA Basic Building Code, Building Officials & Code Administrators
International Inc.
The Uniform Building Code, International Conference of Building
Officials
The Standard Building Code, Southern Building Code Congress
International, Inc.
American National Standard Minimum Design Loads for Buildings and Other
Structures (ANSI A58.1), Amer. National Standard Dist. Used primarily
for wind loads.
Annual Book of ASTM Standards
American Society for Testing and Materials
Local Fire and Building Codes
Electrical andInstrumentation
National Fire Protection Association
NFPA 70 National Electrical Code
NFPA 77 Static Electricity
NFPA 78 Lightning Protection
American National Standards Institute Standards
Institute of Electrical and Electronic Engineers
National Electrical Manufacturers Association Standards
OSHA Electrical Standards - U.S. Department of Labor
Instrument Society of America
Illuminating Engineering Society
-1-
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E1ectri ca1 and InstrumentatIon (Continued)
Insulated Cable Engineers Association
Underwriter's Laboratories (UL) Standards for Safety
American Society of Testing Materials
Factory Mutual (FM) Technical Reports
American Petroleum Institute's (API) Recommended Practices
National Academy of Science - National Materials Advisory Board
Fire Protection Systems
National Fire Protection Association Standards
11 and 11A Foam Systems
13
15
12
20
22
Sprinkler Systems
Water Spray Systems
Carbon Dioxide Systems
Centrifugal Fire Water Pumps
Water TAnks for Private Fire Protection
Heat Exchangers
Standards of Tubular Exchangers Manufacturers Association
Heat i ng Ve nt i1a11ng and A i r Condi ti on i ng
American Society of Heating, Refrigeration and Air Conditioning Society
Standards & Guidelines
Insulation
Noise
Removal and disposition Occupational Safety and Health Administration
requirements
>
Code of Federal Regulation Title 29, Chapter 17, part 1910.95 Federal
Register Vol. 37 No. 202 (90 dba for 3 hours) Hearing Conservation
Amendment 1981
Many state and local regulations
-2-
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f
Painting
Steel Structures Painting Council (SSPC)
American Society for Testing and Materials and American Institute for
Steel Construction
Occupational Safety and Health Administration
Piping
American Society of Mechanical Engineers
ANSI/ASME B31.3 - Power Piping
ANSI/ASME B31.3 - Chemical Plant and Petroleum Refinery Piping
ANSI/ASME B31.9 - Building Services Piping
plus 19 other standards for piping, pipe flanges, fittings and
valves, including
ANSI B16.5 - Pipe Flanges and Flanged Fittings
ANSI B16.34 - Valves, Flanged and Buttwelding Ends
Manufacturers Standardization Society of the Valve and Fittings Industry
30 standards for valves and fittings, including
MSS SP-54 - Quality Standard for Steel Casting for Valves, Flanges
and Fittings and Other Piping Components - Radiographic
Method
MSS SP-61 - Pressure Testing of Steel Valves
American Petroleum Institute
14 standards for pipe, valves and fittings, including
API 600 - Steel Gate Valves, Flanged or B^ttwelding Ends
API 601 - Metallic Gaskets for Piping, Double Jacketed Corrugated
and Spiral Wound
American Water Works Association
AWWA C150 - Thickness Design of Ductile Iron Pipe
AWWA C151 - Ductile Iron Pipe, Centrifugally Cast in Metal Molds or
Sand-Lined Molds, for Water and Other Liquids
American Society for Testing and Materials
Dozens of standards, including
ASTM A 106 - Seamless Carbon Steel Pipe for High Temperature
Service
ASTM A 403 - Wrought Austentic Stainless Steel Piping Fittings
-3.
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Piping (Con't)
"Recommended Practice for Acoustic Emission Testing of Reinforced
Thermosetting Resin Pipe (RTRP), Society of the Plastics Industry, New
York, July 1983.
Pressure Vessels
American Society of Mechanical Engineers ( ASME) - Boiler and Pressure
Vessel Codes
American Petroleum Institute Pressure Vessel Inspection Code, for
Maintenance, Rating, Repair and Alteration-API Standard 510
National Board of Boiler and Pressure Vessel Inspectors - Inspection
Code
Reinforced/Plain Concrete
American Concrete
A compendium of recommended standards and practices, American Concrete
Institute, Detroit
Rotating Equipment
American Petroleum Institute Codes & Standards
American Society of Mechanical Engineers
American National Standards Institute
National Electrical Manufacturers Association Standards for Gas & Steam
Turbines
American Society of Testing Materials for materials used
»
American Gear Manufacturers Association Standards
American Friction Bearing Manufacturers Association Standards
Compressed Gas Association
American Gas Association
Safety - General Guides
j
National Safety Council Occupational Safety and Health series of manuals
1. Accident Prevention Manual for Industrial Operations
Volume on Administration and Programs
Volume on Engineering and Technology
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Safety - General Guides (Continued)
2. Fundamentals of Industrial Hygiene
3. Industrial Noise and Hearing Conservation
4. Supervisors Safety Manual
Prudent Practices for Handling Hazardous Chemical Sustances - National
Academy of Science
National Fire Protection Association - Life Safety Code
Storage Tanks
American Petroleum Institute - Recommended rules for design and
construction of large welded, low pressure storage tank
API Standard 620
American -Petroleum Institute - Welded Steel Tanks for Oil Storage
APE Standard 650
American Petroleum Institute - Venting Atmospheric and Low Pressure
Storage Tanks
ASI Standard 2000
American National Standards Insititute Specification Welded Aluminum
Alloy Field Erected Storage Tanks
National Fire Protection Association - Code for Storage of Liquefied
Petroleum Flammables, Combustibles, Oxidizing Materials, and Codes for
Explosion Venting.
"Recommended Practice for Acoustic Emission Testing of Fiberglass
Tanks/Vessels", Society of the Plastics Industry, New York, January
1982.
Structural Steel
American Institute for Steel Construction
American Welding Society
American Iron and Steel Institute
Annual Book of ASTM Standards, American Society for Testing and
Materials
.5-
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,
Water System
Cooling Tower Institute
American Water Works Association
National Fire Protection Association
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