U.S. EPA Proposes New Risk Management Program Standards for Stationary Sources

On August 19, 2022, the U.S. Environmental Protection Agency (EPA) issued a proposed rule to revise Risk Management Program (RMP) standards for stationary sources using certain regulated substances under the Clean Air Act (CAA). EPA’s proposal marks the latest reconsideration of a rule issued under the prior administration, as directed by Executive Order 13990. The proposed changes include more stringent requirements for accident prevention, emergency preparedness, and public availability of information as well as regulatory clarifications, with climate change and environmental justice featured prominently as a basis for many proposed changes.  Interested parties will have 60 days to comment on the proposed rule following publication in the Federal Register.

The RMP regulation applies to stationary sources holding more than a threshold quantity of a regulated substance in a process. The regulation, which the proposed rule would revise (at 40 CFR part 68), in general terms requires the implementation of technologies, procedures, and management practices to prevent, or minimize effects of, accidental chemical releases and requires the submission of a risk management plan to EPA. EPA first promulgated the RMP regulation in 1996, and it has been subject to several revisions over the years, including a major amendment finalized in 2017 and a reconsideration of the 2017 rule in 2019.

The RMP regulation is a companion to the Process Safety Management standard published by the Occupational Safety and Health Administration (OSHA) (29 CFR 1910.119), although, it is important to note, some of the proposed changes discussed below take the RMP in a direction farther out of synchronization with the OSHA program. Some of the elements of EPA’s 2017 rule related to accident prevention and response and disclosure of information to the public that EPA rescinded or modified in 2019 are incorporated back into EPA’s latest proposal. Both the 2017 amendments and the 2019 reconsideration of those changes have been challenged in court and are pending judicial review.

A key component — and the most costly — of EPA’s proposal is the safer technologies and alternatives analysis (STAA). The proposed STAA applies to petroleum and coal products manufacturing processes and chemical manufacturing processes co-located (i.e., within one mile) of another facility using the same processes and regulated by the RMP. The STAA involves the consideration of engineering and administrative controls as well as safer technology measures, in the following order:

• inherently safer technology or inherently safer design
• passive safeguards
• active safeguards
• procedural safeguards

Notably, the implementation of identified inherent safety measures is not required. Instead, the proposal would require an owner/operator to document the feasibility of these measures, on more than just a cost basis. However, as indicated in EPA’s response to public comments for the 2017 rulemaking (45 Fed. Reg. 4594), an enforcement action under the CAA’s General Duty Clause (42 U.S.C. § 7412(r)(1)) may involve consideration of the STAA, meaning that sources may be indirectly forced into implementing identified measures. In addition, EPA is specifically proposing a STAA to determine potentially safer alternatives for facilities that use hydrogen fluoride in an alkylation unit.

EPA’s proposal includes the following additional key components as modifications to the existing regulation:

1. Prevention program: The proposal adds requirements related to root cause analysis for incident investigations, as well as third-party audit and employee participation requirements.

• • Root cause analysis provisions would reinstate a proposed requirement from the 2017 rule to require that incident investigations incorporate analysis of the root causes of an incident.
  • Third-party audit provisions are geared toward comprehensively evaluating prevention programs for all covered processes and would reestablish a third-party audit requirement that was included in the 2017 rule while rescinding the 2019 reconsideration rule. The audit requirement would apply to facilities with two or more accidental releases within a five-year period.
  • Employee participation provisions would require employer-employee consultation on process hazard analyses (PHAs), compliance audits, and incident investigations; grant employees an opportunity to stop work at the facility under certain circumstances; and provide additional reporting opportunities for employees.

2. Hazard identification: Under the proposal, EPA would add text to the existing regulation “to emphasize that natural hazards and loss of power are among the hazards that must be addressed in hazard reviews and PHAs” as well as “to emphasize that facility siting should be addressed in hazard reviews.” EPA views these additions as clarifications of existing requirements rather than adding regulatory requirements. The rule would add, however, that recommendations from hazard evaluations must be either implemented or included in the RMP to be publicly disclosed.
3. Hazard information: EPA proposes that facilities would be required to provide chemical hazard information and community emergency preparedness information to residents within six miles of the facility.

The proposed rule contains additional requirements and clarifications regarding the existing regulation, and further requests public comment on 15 specific categories of issues identified by the EPA, including the categories of revisions discussed above.

The rulemaking documents for this proposal will be published in the Federal Register under Docket ID No. EPA-HQ-OLEM-2022-0174. EPA plans to hold virtual public hearings on September 26, 27, and 28, 2022.

Stationary source owners and operators should consider EPA’s proposed revisions and whether to submit comments to EPA upon publication of this proposal in the Federal Register. The final rule is also almost certain to draw more litigation based on the history of changes to the RMP rule as noted above.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.