Extinguishing Fire Risks

Every year, hundreds of recycling facilities experience fires that result in significant property losses. These losses affect their profitability, the wellness and income of their employees, and their customers’ businesses. According to the RecycleGuard® loss history from 2011 to 2014, fire losses accounted for about 40 percent of property loss dollars incurred but only 14 percent of the total property loss incidents. Fires might not occur frequently in the recycling industry, but their consequences can be severe when they do occur. Even an incidental fire—such as in a piece of equipment—can result in a large economic loss for your company due to reduced business income.

Require a permit for hot work. A hot-work permit program can reduce the likelihood that sparks and embers from your torchcutting operations could ignite waste or other combustible material in or near the work area. Designate a person to issue hot-work permits in your operations to ensure the work is performed in a safe area, at least 35 feet away from flammable and combustible materials. Make sure floors are clean, and if the floors contain combustible materials, cover them with fire-resistant tarps. Remove all ignitable liquids, cover any floor openings, and protect items you cannot move with welding pads, curtains, and other fire-resistant materials. When doing hot work outside, consider the prevailing wind speed and direction, and protect any material stored nearby. Make fire-extinguishing equipment readily available near the hot-work area, and institute a fire watch for 60 minutes or longer after completing any hot work.

Use maintenance and monitoring to reduce electrical risks. To minimize fires due to electrical failures, implement an electrical preventive maintenance program that includes inspecting electrical circuits for potential overloads and storing flammable liquids away from electrical equipment in containers or cabinets approved for such liquids. Thermographic monitoring can help detect electrical and mechanical defects in equipment that could trigger a fire. It’s also prudent to use a licensed electrician for all electrical work.

Control the path of lightning. Lightning strikes and energy surges can damage and idle equipment as well as ignite shredder fluff, causing a significant fire. Installing a lightning protection system on outdoor equipment such as shredders gives any electrical charge a path to the ground. Such systems—best installed by a qualified contractor—usually include copper air terminals, copper cable, copper-clad ground rods, and surge protectors.

Beyond Property Damage

In addition to damaging property, fires can affect your company’s income by idling essential equipment and halting plant operations, so it’s prudent to have a business continuity plan. Such a plan should prioritize critical business functions and processes, calculate the maximum time you can be down without significantly affecting revenue, set recovery-time objectives, identify the acceptable amount of data/computer loss your company can sustain, and plan how to continue basic business activities. The plan’s ultimate purpose is to get your business up and running in the shortest time, minimizing your economic loss.

James Kelley is senior vice president, underwriting officer for Willis Programs (Portsmouth, N.H.). Reach him at 603/334-3084 or james.kelley@willis.com. RecycleGuard—the ISRI-sponsored insurance program—has prepared this article for informational purposes only. It is not intended to provide legal advice. Readers should not rely on this document or act upon any of the information it contains without first consulting competent legal counsel.