Marc Rothschild, P.E.

Transcription

1 Marc Rothschild, P.E.

2 Why spend money on managing risk? Reduced risk increased reliability increased on time performance $$ The occurrence of a hazardous event can have a significant direct and indirect impact on the company - and could put a company out of business. It is the right thing to do.

3 How much should be spent on managing risk? Money got back in return Good Business Poor Business Bad Business Good Humanity Going Out of Business Money spent on safety

4 Evaluating Risk using Risk Matrix Severity Likelihood (per yr) Low (minor injury) Medium (serious injury) High (fatality) 1/yr 1e -2 1e -2 1e -4 1e -4 1e -6 < 1e -6

5 Limitations of Risk Matrix Approach Difficult estimating frequency of rare events Difficulty in assessing consequences Can be biased by individual team member opinions Inconsistent analysis

6 Quantifying Risk When you can measure what you are speaking about and express it in numbers, you know something about it." Lord Kelvin 6

7 LOPA Overview Initiating Event Safeguard(s) Hazardous Event Enabling Condition Consequence Conditional Factors Mitigation Safeguard 7

8 Generalized LOPA Equation Initiating event Consequence Pe Ps Pc Frequency for given initiating event (i) = F (i) x P e(i) x P s(i) x P c(i) F(i) = Frequency of initiating cause (i) P e(i) = Conditional probability of enabling event(s) P s(i) = Conditional probability of safeguard(s) P = Conditional probability c(i) of consequence 8

9 Advantages of LOPA Using predefined failure rate data ensures consistency between studies LOPA approach removes bias of any individual team members The failure rate data incorporates company and industry accepted failure rate data.

10 Balancing Spending with Risk Reduction

11 Who s Risk is being Managed?

12 Employee Risk Employees accept some risk in exchange for benefit of employment. Employees expect a safe workplace environment. Fatality Rate at home = 1.2 x 10-4 /yr Fatality rate at work = 2.0 x 10-5 /yr (chemical industry) - 1/3 of industrial fatality rate from process safety incidents. Avg. process safety fatality rate = 6.6 x 10-6 /yr

13 Employee Fatality Rate

14 Establish Risk Target Example: Company XYZ Corp, with 200 employees wishes to provide a safer than average work environment. Company selects employee risk target of 1.0 x 10-6 /yr The overall facility targeted risk would then be: 1.0 x 10-6 /employee/yr x 200 = 2 x 10-4 fatality/yr.

15 Using LOPA to Calculate Facility Fatality Rate (F (i) x P e(i) x P s(i) x P c(i) x N (i) ) F (i) = Frequency of initiating cause (i) P e(i) = Conditional probability of enabling event(s) P s(i) = Conditional probability of safeguard(s) P c(i) = Conditional probability of consequence N = Expected # of fatalities 15

16 Simplified Approach Fatality rate is based on entire facility. For large facilities, it may take several years to complete all LOPA s. Prorate the risk for each unit, or tacitly assume that each risk contributes equally to the overall risk. Example: if facility standard is set at 2 x 10-4 fat/yr and facility consists of 5 units, then set risk standard for each unit at 4 x 10-5 fat/yr.

17 Other methods of evaluating risk Some government standard exists that establish risk for entire facility. This approach does not take into account the size of the facility so it is biased against larger facilities.

18 Other Methods, etc. Many companies evaluate LOPA on scenario by scenario basis. No logical basis for this standard. Risk of individual scenarios is a function of how scenarios are defined. Traditional LOPA approach does not take into account magnitude of risk.

19 Other Methods, etc. At least one company evaluates combined risk to most exposed employee. This approach evaluates total risk, as recommended in this paper. However, basis for establishing most exposed employee is unclear.

20 Conclusion Managing risk is the right thing to do. Spend the right amount on managing risk. Spend too little unacceptable risk to employees and possibly to company. Spend too much Reduces profits. Establish targeted risk level. Evaluate risk using LOPA.