Alternative safety approaches 2017 fee consultation feedback

The feedback received during the alternative safety approaches fee consultation has been posted according to our Submission Guidelines.

RESPONDENT FEEDBACK
Consultant

Generally support. I am not directly impacted by the fees you charge, however I hear concerns from those clients of yours that I work with - they are very concerned that the fees under an ASA option - particularly the hourly professional rate for assessment of ASA Plans and the annual ASA fees, including the costs of your audits, eliminate any value added or benefits they can achieve by electing the ASA voluntary approach. ASA clients rack up considerable costs - both internal resources and contractor assistance - to submit ASA Applications and ESA and SMP Plans. They are frustrated at the length of time it takes to get Applications accepted and are concerned about what your hourly rate fees for SMP Plan Assessment will be based on what they are seeing at the SMP Application stage. 

My comments in this feedback will be more directed at improvements I believe you can make to the ASA program, specifically the SMP option, as you start to look at the full structure review you are planning to do in 2017.

Change: First let me comment on the ASA Application -it seems to me that key information you require at the SMP Application stage, other than basic company information etc is to know the parts of the regulations, codes and standards under the SSA Act that a company wants to deviate from, what the substitutions are and be able to assess if the company has the ability to operate and maintain the regulated equipment as safe or safer under the SMP as under prescriptive regulation. Based on the nature of the deviations - administrative versus qualifications of people versus design or regulated equipment an assessment of the likely SMP Hazard Category should be able to be determined, recognizing that the SMP Hazard Category might change when the SMP Plan is submitted. This level of information should be adequate to make a decision on an SMP Application. Unfortunately that is not the case for current operating facilities - you are requiring significantly more information at the Application stage, including a detailed safety argument for every part of a regulation that a deviation is being requested - you will get all of this in the SMP - why is it necessary at the Application stage - I don't see where it is a stated requirement in the ASA Regulation to have this level of information in the SMP Application.

I suggest you need to identify the value to a client to pay the Pre-Application optional fee - not clear what value a client gets for this fee, other that registering an interest in the ASA options.

Do not change: Generally I think the fee structure is sound - I like the fee per site approach because even though a company utilizes the same safety management system across their business the public safety risk can vary significantly at different sites, based on the hazards that exist at the sites and the impact that could result from a catastrophic failure at a site. The same hazard can result in very different impacts, based on the density and nature of other businesses surrounding each site.

Feedback: The ASA optional approach to managing public safety has tremendous potential in this province - it is innovative and unique across Canada - but it is not still well understood by most owners and operators. Some specific observations where improvements could be made:

1. Streamline the ASA (SMP) Application process - reduce the level of detail you are asking for at this stage in the process - an SMP Application, including the addendum document, should be no more that 6-8 pages of information. I suggest that twenty five plus pages is excessive.

2. State clearly what the objectives of the Safety Standards Act are so its clear to your clients. Additionally it would be very helpful, not just for the ASA clients but for your prescriptive clients, to understand the objectives of each of the sections of the regulations under the Act - Guidance documents, similar to the Guidelines that Worksafe BC includes on their website would be very helpful and a great educational tool.

3. A key value added aspect of the ASA option is the increased freedom a client has to operate and maintain their regulated equipment without a need to have to comply with the restrictive and detailed requirements (things like seeking permission every time and submitting reams of paper records - etc.) that are a requirement under the prescriptive regulations - however until BCSA is more diligent and consistent in your oversight of those who operate under the prescriptive regulations owners and operators, leaning to the ASA approach, will not see the true value and need to pursue the ASA options. If all those rigid prescriptive requirements are not truly enhancing the safety of the public then change the prescriptive requirements. Ironically 90% plus of the substitutions I have helped clients with in the ASA options to date are substitutions to administrative and record keeping requirements that are burdensome to keep up with and do very little to enhance public safety.

4. The regulator oversight methodology for ASA - auditing - is excellent - audits are a key opportunity to assess how a client is doing and a great opportunity to help the client learn about and implement best practices and ways they can improve their safety performance - things your auditors will be able to help they with from the various experiences they have. This begs the question why not implement the audit approach for all aspects of operating companies regulatory oversight - more efficient for you and your clients and this would improve public safety outcomes.

5. Please update your ASA Guidance material to better clarify your requirements in the Application and SMP Plan submissions. I believe this would greatly cut down on the numerous Requests for Additional Information letters.

6. The ASA approach is a great opportunity for an owner/operator to improve public and worker safety - the proof you require to demonstrate safety performance in an SMP is light years ahead of what is required under prescriptive regulation - a good example of this is how having an operating permit for a pressure vessel used to store a hazardous substance is an adequate requirement under prescriptive regulation - under an SMP you require a company to demonstrate that it has an effective and complete safety managed system in place - that is the right approach to safeguard the public. I suggest that under prescriptive regulation as you carry out your oversight at operating permit renewal time you should be looking for a similar approach as the hazards are the same in each situation.

Thank you for the opportunity to provide input - much appreciated.

LNG Canada Development Inc.
Employee

Generally neutral. The related context or background to the fee structure, where additional information around the predictability of various ad hoc costs for ASA-related matters needs to be described in some form of supplemental.

Change: Addition of benchmarking data capturing variation for various industries, operational scales, and project development status. Consider freezing (or reducing) hourly rates during times of economic uncertainty to be in sync with industry trends. These additional services fees require some additional support (consultation) to assist in clarifying how to estimate efforts along with the proposed rates as well as demonstration of how the use of BCSA consultative services are appropriate and at least comparable to the model of hiring external expertise. The additional information should be viewed as complementary to the consultation process associated with fee changes and further help to demonstrate the full picture of BCSA cost recovery in promoting improved efficiency within the regulated services delivery.

Do not change: Fixed fee structure.

FortisBC
Employee

Strongly opposed. The biggest challenge for us in adopting an ASA company-wide is the site-based fee structure. For a company with numerous small sites that are geographically dispersed, the cost of the ASA application and annual oversight fees is prohibitive. In general we agree with the ASA approach, but under the current fee structure the perscriptive permitting fees are significantly less costly.

Do not change: none.

Changes to make: Move away from the site-based fee structure. Move to a single fee per operating company.

Feedback: he site-based fee structure is cost-prohibitive for companies with numerous geographically dispersed assets. The concept of the ASA is fine, but the fee structure makes it uneconomical.

FortisBC
Employee

Generally support. No Challenge. The ASA process has been too long and the fee schedule is unimportant with respect to the delay in the process from application to receipt of approval.

Do not change: Fee structure is easier to adopt if product is produced. So far the fee is really not the concern vs. the lengthy application process. (>2 yrs now)

Feedback: BC ASA is the right approach and is superior to prescriptive regulation. There is not enough support from BCSA and the process takes too long and I feel that the ASA is a project off the side of someone's desk and not taken seriously with the BCSA. Therefore, motivation to continue with the ASA from an ownership perspective is fading very fast.

Canwest Propane
Employee

Strongly opposed. The fee's charged by the BCSA at 2016 rates are 10 times higher than any other jurisdiction in western Canada. The fee structure unfairly paints all new applicants with the same brush by pre determining a risk level 3 because it is a new application. The initial application and audit process does not take into account the programs that corporations have in place in other jurisdictions nor does it take into account the businesses past safety record. I do not believe that the BCSA truly understands the costs that are born by the ASA owners, both financial and from a liability and implementation perspective.

Change: Given that the owner of the ASA commits a large amount of resources to not only implement the program but maintain it. Given this large commitment it is our opinion that annual audits are not required. The BCSA should implement a quarterly report so that normal review of processes can be overseen to ensure compliance. Audits should only be completed at 3 year intervals and by doing this further reduce the audit costs and resources needed to accommodate the BCSA during these audits.

Do not change: I do not feel that any of the existing fee structure should not be reviewed and efforts made to reduce costs. Given the current economic environment government bodies should be looking for any opportunity to reduce costs. This would create a positive business environment for companies to continue to invest in new opportunities for growth and further job creation.

Feedback: The Government of BC has made a commitment to reduce red tape. The BCSA needs to follow the government's lead and look internally at ways that it too can reduce red tape. The ASA application, audit process and fees associated with the ASA are hard to navigate and do not add benefit to the owner. Programs of this nature should entice corporations to make application by offering benefits both administrative and financial. Owners of these programs do all the heavy lifting and take on liabilities that would normally be born by the BCSA. For these 2 reasons alone the administration and costs associated by implementing these programs should be made to benefit the owner not the authority.

Pengrowth Energy Corporation
Employee

Strongly opposed. No issues or challenges with the fee structure. Our challenge is specifically concerning the fee increase for the reasons noted.

Change: No issues or challenges with the fee structure

Do not change: No issues or challenges with the fee structure.

Feedback: At the beginning of this year Pengrowth requested for a greater than 30% reduction in costs from all of our vendors and suppliers to help offset our 55% decline in revenue from weaker oil and gas prices. These cost reductions apply to every aspect of our business and it is critical that all vendors and service providers provide these discounts going forward. Therefore, we are not in favor of this increase.

LNG Canada

Strongly support.

Change: No

Do not change: No

Feedback: Thank you for informing us. I (from LNGC Canada) have no objection with your proposed fees increase for Alternative Safety Approaches effective 1 January 2017.

This page contains submissions received by July 7, 2016, 11:59pm PDT

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