8.0 MINING MACHINERY

The only known use of PC3s in electric motors was by Reliance
Electric Company of Cleveland, Chio, which used PCBs as a ccolant in certain
specialized motors. ‘These motors were used by Joy Manufacturing Company of
Franklin, Pa., in several types of mining machines built during the late
1960s and early 1970s. ‘The motors require rebuilding every few years, Al-
though PCRs are seléom lest from the motor housing when the motor fails, such
loss of fluid would result in substantial exmcsure of the machine cperator
to PCBs. The proposed regulations allew a limited seriod of time for conver-
sicn of the machines to motors which do not use PCas.

8.1 Remuirements of the Proposed Regulations

All of the PCS motors mst be removed from service in mining ©
machines by December 31, 1981. ‘The motors on the continuous miners may se
rebuilt as PC3 motors “or one vear after the effective date of the recqula-
tions. The sotors-on the leaders-must-be reboitt easy tyre totors-wherr tie
motors are returned to the shop for servicing. Continued use of 23 motors on _
mining machines mist te reported to EPA within 90 days after the effective
Gate of the regulation, amd a spill response plan must be develored and

~—aporoved bya_registered oroftassional _engineertor_each usar_installasion

8.2 Ownership and Use of 2C3 Mining Machinery

Joy Manufacturing Campany was the sole U.S. producer of mining
equigrent which used. 2C3s.as a_motar ccolant.__ Bath continuous miners and.
loaders were built using PCB motors: Table 8.2-1 summarizes the sroduction
statistics and the present use status of these machines.

One small coal mining operation located in Pennsylvania is
operating the three remaining model CU43 continuous miners mown to be

-31-



CT

One other problem with air-cooled transformers is the tendency ~
of dust to be attracted from the air to the coils by electrostatic forces.’ Dust
can build up in the coils and block the flow of air, or it can form conductive
paths and cause short circuits.

Open-air-ccoled transformers are generally limited to dry,
clean locations where the load requirements are fairly even and constant, and
where the maximum voltage does not exceed 30 kv. Such transformers are being
successfully used in large office buildings, particularly tall buildings where
the transformers are located every few floors. Even in this application, though,
conditions arise that exceed the capabilities of the transformer; for instance,
in the Sears Tower in Chicago, which is over 1400 feet tall, the electric power
is brought into the building and up to the distribution transformers at 128 kv,
which is beyond the voltage limitations of open-air-ccoled transformers.

Closed Gas-Tilled Transformers

Transformers can be built with dry inert gas (usually at an
elevated pressure) as a heat transfer medium. These transformers avoid the
maintenance problems caused by moisture and dust in open air-cooled transformers,
but they are similarly Limited in overload capacity because of reduced thermal
inertia compared to liquid-filled transfomners.

Closed gas-filled transformers must be installed in pressure-
tight containers due to the changes in gas pressure caused by changes in temper- ©
ature. However, the maximum voltage ratings of gas-filled transformers can
be equal to that of liquid-filled wits. °

A mumber of different gases have been used as heat transfer
media in closed gas-filled transformers. The most common gas used in the U.S.
is the fluorocarbon hexafluorcethane (C2Fs). Nitrogen and sulfur hexafluoride
have also been used successfully in certain applications. Helium has not been
found to be a satisfactory gas for this application because its low dielectric
strength results in corona discharges within the transformer. Hydrogen is un-
satisfactory as any leak in the transformer would result in a severe fire
hazard.

-115-



——expecteds

3.0 IMPACTS OF BANS CN THE DISTRIBUTION OF >C3 CAPACITORS ‘
The proposed ban regulations would require that PCB capacitors not be:
installed in newly manufactured products after December 31, 1978, and that
new equipment containing PCS capacitors not be distributed in commerce after
June 30, 1979. The ban on mamufacturing would apply not only to the instal-
lation of a capacitor in a piece of electrical apparatus, out also to the
installation of any 'PCB Equipment':in a larger assembly. For instance, the
December 31 ban would apply to the assembly of a FCB capacitor into a
lighting ballast, the assembly of a PCB ballast into a lighting fixture, and
to the assembly of a PCB lighting fixture into a subway car. Buildings con-
taining PCS capacitors, however, are specifically defined as not being 'PC3
Equipment’. ‘The ban on distribution of newly mamifactured goods’ ia commerce -
would also apply to all of the varieties of 'PCB Equipment’. ,

3.1 B€fect of the Ban Regulations

Most manufacturers of ac capacitors switched to substitutes for the
FCB dielectric liquids by early 1978.. No PCS capacitors are expected to be
manufactured after August, 1978, when Aerovox Corporation expects to exhaust _. _.
its inventory of PCB liquids. Manufacturers who use PCB capacitors as cam
ponents of 'PCB Equipment’ will generally be able to use up their inventories
of PCB capacitors by the end of the year, and little inventory loss is

The greatest impact of this portion of the ban reguiations may se
om read amventaries Of AppLISncss Such asain conditioners ani television ———- -.
not-all be: sold to vbw itinans- coer ty dere 307-2979 nher- ter fursner oe
is not expected to be great since such appliances would not be labeled as
PCB equipment (since the labeling requirement does not became effective until
January 1, 1979), and the appliances would be widely distributed in fetailer's

-L7-



ee —

EPA 560/6-77-035

MICROECONCMIC IFPACTS OF THE PROPOSED
_ "PCB BAN REGULATIONS’

FinaL Task REPORT

Submitted to: .
U.S. Rnvirormental Protettion Agency
Office of Planning and Management
Washington, D.C.

Attention: Mr. Steven 5. Malkenson
Project Officer

Contract No. 68-01-4771

Submitted by:
_ VERSAR INC.
. 6621 Electronic Drive
Soringfield, Virginia 22151
(703) 750-3000

May 16, 1978



changable with askarel transformers in new applications provided that the
installation is properly engineered. Other substitutes for askarel transfomers ”
are also available. The 140,000 askarel transformers presently in service total ...
only two percent of the total number of power and distribution transformers in use.

16.3. Substitutes for PC3 Transformers

The askarel transformers presently in service were specified
because this type of liquid filled transformer offered advantages in size,
reliability, and fire safety-that were not available with other types of trans-
formers. Alternatives to PCB transformers have always been. available, although
all of the other types of transformers have different desi¢n characteristics
and none are direct substitutes for the PCB units. Therefore, eventual re-
Placement of the existing PCS trensformers will requite that each of the pre-
sent installations be re-evaluated and that the necessary engineering changes
be made to allow use of the best available replacenent New transformer
installations will be designed to make optimm sise of thé’ available ron-PCBs- ° -
transformers. The choice among the available alternate transformer types and
Materials depends on the requirements of each specific application and.the
characteristics of the available non-PC3 units.

A number of alternatives to the use of PCBs in fire resistant
liguid filled transformers and to the use of transformers which contain any
dielectric liquid have been developed and are commercially available. These
substitutes for PCB transformers differ in. their performance characteristics,
applicable fire code installation requirements, and cost. The following sections
discuss the major types of substitute units which are available.

Bigh Fire Point Liquid Insulated Transformers

The 1975 National Electrical Code and previous issues allowed
only the use of askarel and dry type transformers in hazardous locations with-
out vault protection. Askarel was essentially defined as PCB based liquid.

The 1978 NEC has added a specification (Article 450-23) for 'High Fire Point
Liquid Insulated Transformers' which can be used under these same conditicns.
The 'High Fire Point Liquid' mist have a fire point of at least 300°C, and
must not propogate flames.

-i-



9.0 SLECTROMGETS

Large electremagets are installed ever conveyor belts to remve
tramp iren from non-maqetic commodities such as @al and crain. Most of
these electromacnets are cooled with 100 t 150 gallens of mineral oil.
Where increased fire safety was recuired, the magnets were often filled with
FCEs, The three macret manuf: uzers who used >C3s were:

Stems Magnetics, Cadahy, Wis.

Eriez Macrets, Erie, Pa.

Dings Co., Milwaukee, Wis.

ings Co. stcored using PCs in mic-1976; the other tvo manutac-

turers have not used 2Cas since 1971 or 1972. A total of about. 250 PC
magnets were manufactured; approximately 200 of these ray still be in use
in the United States. Mest of the PC3 mamets are being used in coal mines,
ceal preparaticn plants, and in ccal-fired gerierating stations. It is 7
pessible, but not confirmed, that same of the PCB mactiets may be used on
grain conveyors because of the flammability of grain dust. : ,

The electromacrets are of completely welded constructicn, and
very few leakace incidents have occurred with aither oil filled or PG
filled magnets. Based cn desicn considerations, electramamets would be”
expected to be less likely to fail than would transformers. Those leaks
which have occurred have been caused by physical abuse or lack of adequate |
Maintenance. Maintenance requirements do mot expese workers or the environ-
ment to contact with PCSs.

9.1 Requirements of the’ Proposed” Requlaticns”

Qnly transformers and capacitors are defined as "totally enclosed
uses" of PCBs. All other PCB equinment, including PCS electrcmagnets, must
be removed from service by the effective date of the regulation, and dis-
posed of in accordance with the "PCS Disposal and Marking" regulaticns.

-60~



Other dydraulic Systems

approximately 20% of the fims curchasing 2B hydraulic fluid in
1970 and 1971 were steel companies and other firms not engaged in die casting.
It is therefore likely that 20% of the usage of PC3 hydraulic fluid was in
systems other than in die casting machines. Although there is little inform-
tion available on the use of this material, apparently not all of the systems
are still contaminated with siqnificant concentrations of PCBs. Budd Co.
stated that their operations should not be significantly affected by the sro-
posed ban regulations since the hydraulic systems on each of their welders
have been drained and refilled on the order of 120 times over the last five

years. (1)

The procedure of draining, flushing, and refilling any of these -
other hydraulic systems to reduce the level of PCBs should cost. approximately
the same per gallon of fluid as a similar procedure performed on a die casting
machine hydraulic systen. As a rough estimate’based on the provertich of 23
hyGraulic £luid used in such systems, the cost of deccntaminating these other
hydraulic systems should cost 25% as much as the cost of decontaminating the
die casting machines, or a total of $3,650,000.

The preresed regulations would require that the level of >@3s in
these other hydraulic systems be reduced to less than 50 sem by the afiective
date of the regulations or the systems removed Sram service until the required

1s tht <r rr Teste or sigiiticane
adcitional costs due to disrupted production in steel mills, as the hydraulic
systems are central to the operation of the large equipment used in these

-- facilities;— Hewever; thi St itepie-o-estebicsir -

“whether: “the-bSchutbait Geiss amisiat-soh Sint ne Sectiige sheet ty thee tete—
of the regulation, nor to estimate what the costs due 9 precuction interm>-

- tions-would-.bey + << eee

(1) Telephone conversation, C.W. dabitz (Budd Co.) with Bruce Woodcock
(Versar), September 22, 1977.



unintentional contamination of waste oil, but ro information is aveilable
an the extent of PCas in transmissicn fluids. ne

Contaminated oils have mt been ‘segregated from the flow
of oil collected for reclamation. As a result, mch of the oil presently
handled by the waste oil collectors, processors, and re-refiners appears --
to be contaminated with low levels of PCBs,

2.2.4 Transformer Marmfacturing and Maintenance

Most: large electrical transformers are-designed to coerate | a
with the current-carrying coils immersed in a Helectric Liquid. This
liquid provides electrical insulaticn between the windings by filling in
any pinholes in the enamel or paper insulation. The liquid also performs
as a heat transfer media By afsorbing heat from the coils and conducting -
it to the outer shell or heat transfer surfaces by natural or forced oom... es,
vecticn. Most liguid-filled transformers are cooled with mineral oil. This
oil can present a significant fire hazard in the event cf a short circuit
within the transformer. ‘Therefore, oil-filled trensfomers are not allowed
to be used in hazardous Iccaticns such as buildings excest.when installed in.
a fire resistant concrete vault.

.In the past, most transformers used in hazardous locaticns:

have been filled with non-flammable coolant liquids containing PC8s as a
—"major-conborenit. Tess PCS Sarisroiter liquids are Known by the cenéric
--temm—askarel"-and-have-been-hr-camon tse sins the t$26"s- ir taarcous

-- trans fommr-erclications.——Aithough the Pos fitled transfomters“have-cost——" a

-.20,_perrent gore than oil filled mits, they have found wide use. 2S they ai@.————

--~non~flanmabie - and-mere-reltabie-than cil-fiiled transi Sm eer

peace ae - ‘he mantiiacturers.of 203_transfomers discontinued 7antinn———— somes
facturing PCR. transfommers--by~the end of 1977,~ ‘There are presently in use"
approsxcmately 140,000 PCB transformers which contain an average of 300
gallons of licuid (2,150 15 PCS). ‘The average service Life of these



17.0 ‘TOTAL COST AND ECONCMIC IMPACTS

“The preceding chapters have discussed the’ various costs which will
result from compliance with the proposed reculaticns. Costs of decontaminating
or scrapping existing equipment, preparation of spill control plans, and the
costs associated with the ban on rebuilding askarel transformers are all
transitional costs — the annual costs will eventually decrease to zero, though
this may require 20 years or more. Cost increases due to the increased prices
for nom-PCS capacitors and transformérs will be long term costs — they will be
expected to contime indefinitely. , ,

Econemic impacts, as distinct from cost impacts, include employment
effects, changes in market structure, and impacts on energy demand and the
international balance of trade. ‘These impacts, tco, can be both transitional,
and long term. ;

17.1 Transitional Cost Impacts

See Table 17.1-1.

~120-



APPENDIX A

Public Law 94-469" ; so .
90 Stat. 2003 et seq

Page Ae-2: Section 6(e): Polychlorinated
- . Biphenyls

Page A-3: Section 6(a): Scope of Regulation

acl



million 1b x 0.3 / 11 1b per gallon = 1 million galions) of 23 fluid was used _
in these machines during the two year period. Assuming further that each
machine had a hydraulic system containing 300 gallons and required that amount
each year to replace leakage, the total one million gallens of fluid could have
been used by 1000 machines which used 1000 gallons each.

The remaining 20% of the largest purchasers of PCB hydraulic fluid
were steel mills. FCB hydraulic fluid was reportedly used as a standard fluid
in many plants in those applications’ where leakage would present a fire hazard.
Representative uses would include stsel furnaces, ladles, strip mills, vacuum
degasers, and continuous casting machines. There ‘is no information available '
on the total number of hydraulic systems in the steel industry that used 23
fluids, nor is there any information available as t the oresent concentration
of PCBs in these systems. oo :

10.3 Compliance Costs

Die Casting Machines
Most die casting machines were flushed and refilled with a non-Fc3
hydraulic fluid after the owners became aware of the envirormental and health
hazards associated with PCBs. The hydraulic fluid recommended by Monsanto
as a replacement for the PCB fluid in 1971 was based on polychlorinated ter-
phenyls (PCTs). ‘The manufacturing of PCT fluid was discontinued in 1972 or |
1973 and the product. lines were. replaced with other types of hydraulic liquids.

The refilled hydraulic systems have been maintained in use by
topping off when necessary to replace leakage losses, and in same cases by
periodic replacement of the fluid. As a result of the continual removal of
contaminated Sluid, the concentration of. 2C2s has. been gradually reduced to -.
low levels, although in many cases the residual PCBs exceed the 50 rom limit- ~~
proposed by the regulation. The available information on sresent ievels of
PCBs in the hydraulic systems of die casting machines is summarized in Teble
10.3-1.

-66-



demanc for new transfomners. Assuming that manufaczuring and rabuilding ara
equally labor intensive, there would be a change of emlcyment from the service
shops to the central manufactiring plants, but no net change in employment.

A rough estimate of the employment effects may be calculated fem
the total of the transfommer rebuilding business. It was estimated in
Chapter 4 that a minimum of 335 askarel transformers are rebuilt each year at
an estimated cost of $14,000 each (70% of an average $20,000 per unit replace-
Ment cost). Assuming that one halt. of the cost was Que to direct and indirect
labor, the annual payroll resulting from this activity would be equal to (335

x $14,000 / 2= $2, 345,000). Assuming an average nurdened labor rate of $30,000 .

per year, this payroll is equivilant to 78 full time jobs. Since the estimates
ef percent lakor and annual wages are rough estimates, the employment impacts
might be better stated as ranging from 50 ta 100 jobs. It should be moted =~
that increased employment at the manufacturing plants will offset these job
losses, so any structural unemployment must be considered to be a transitional

cost of the regulation.

| ‘The FCB disposal regulations require that units be drained and
flushed prior to disposal. Survey of a number of users has indicated that
this will usually be contracted out to experienced reliable transformer :
service organizations. This increased demand for the services of the larger
(usually manufacturer cwned) service shops may offset most of the business
lost by the ban on rebuilding of askarel transformers. Therefore, the draft
ban. regulations_are not expected to _have_a significant scoremic. impact.on. the.
transformer service and maintenance industry.

The only directly identifiable- impact of the draft regulations on
transformer gaintenance companies is_the requirement that a spill. pravention..___
and control plans be prepared. Preparation-of these plans and the required
professional engineering review may require four man-days of effort and
result in a cost of $1000 per firm for firms handling askarel transformers.
This would tend to bar the small operator, resulting in minor market shifts.
Cost of the required plan could equal $1000 for each of about 100 fimns, or a

=24— -



14.3) Summary

Compliance Costs

Phthalocyanine Blue ~ Production changes $500,000 - 1978
Diarylide Yellow - Increased costs of $10 million to
substituts pigments $25 million per year
Employment Effects

Several hundred.jobs would be affected if the manufacture of
diarylide yellow pigments were banned. These waild be offset by employment
increases in the segments of the pigment industry supplying the substitute !
materials.

-35-



The major cost impact is expected to result Scem the retrofilling and
decontamination of the transformers. The concentration of PCRs can be reduced
to the required Limit of 43 by draining the askarel, flushing the transfomers,
ard replacing the liquid-with a suitable high fire point transZomer Liguia
such as silicone. Based on the retrofill costs presented in Table 6.2-1, the
costs incurred by the railroads in the first 15 months following the effective
date of the regulation will total $7,043,000.

Reduction of the concentration of PCBs to 1000 prm by three years
after the effective date of the regulation would require that a transformer _
be retrofilled an additional two times or that the liquid be processed at
least twice to remove PCBs. No estimates have been made by transformer con-
panies as to the cost of processing to rarove PCBs. The cost should be similar

to the cost of retrofill less perhaps 90% of the cost of the replacement Licuid.

The cost of processing as calculated in Table 6.4-1 would therefore be about
37% of the cost of retrofilling. Additional analyses would be required 12 to
24 months after each retrofilling or orecessing at a cost of about $75 per
analysis. The total cost of reducing the PC3 concentration in the retrofilled
transformers would therefore include soth the cost of the processing and the

additional cost of ansiyringthe- tied aster the ens forme is retmedtos =

service. The additional cost to the railroads of achieving this low lével of
PCBs is calculated in Table 6.4-1 to be $5,460,000. . These costs will be in- . |
curred curing the years 1980 and 1981.

each of the seven owners, “Because of of che complexity or wailsed operations,
these plans will cost several thousand dollars to prepare and implement for

a total industry expense of-perhaps $20,000.67" --—

Finally, the initial reporting-of the identity -ef-the PCB equip ~~
ment and the liquid capacity of each transformer will cost several collars
“pervunit, for an additional cost of perhaps "$5,000. —

-31-



equipment is likely to raach obsolescence. by the oroposed compliance cate -
i.e., 1981. Replacement of this equipment, therefore, may occur regardless
of the oropcsad FC3 ban regulation. However, mining operations will no longer
be able to employ the obsolete equipment as Spare equipment to take up the
slack resulting from machine servicing, nor will they be able to sell it in
the used equipment market. Forced scrapping of this equimment prior to the
end of its useful life can result in significant costs (losses) to a mining
operation, depending upon the remaining useful life of such equipment.

Six of the eight. companies using the PCB miners are relatively svall,
with production of from .7 to 4.2 millicn tons per vear. ‘The other °C3
miners are in use in mines cwned by conglamerates which produce considerably
greater tonnage of coal. Any costs which are likely to be borne by these
companies as a result of the lest corortmity to sell their PCa emtuiement in
the used market will have little or negligible impact on the market price cf
coal. This stems from the small market share of U. S. coal now mined by PCB.
cooled comtinucus miners and the ability of competitors to expand operations.
Furthemore, Versar estimates that whatever costs are incurred by these eight
mining companies will not result in company closures and subsequent lesses of

employment.

" Table 8.3-1 summarizes the possible eccremic costs of the preposed
PCS ban regulaticn to the eight miming companies using the continucus miners.
Nete@ that only PCS-ccoled continuous miners that are still in service are
considered in this analysis because it is not known how many of the remaining
forty-one continuous miners located have a positive market value and useful
life. Assuming that forty of these miners can be sold in the used equinment
Market (i.e., omitting the one continuous-miner that.is being.used by the: ..
vocaticnal school), the additional econcmic costs would be a-maximm of —
($40,000 x 40 = $1,600,000). In mo case wes the ecoremic imact cn any
company exceed cre percent of the annual value of the ccal mined ty the
company.

-56-



percent within 15 months after the effective date of

the regulation. This will require that the trensformer ....
be drained and flushed to remove the FCB Liquid and re- .
filled with a nom-PCcB Liqnid.

4, Transformer liquid must be analyzed immediately after the’
transformer is retrofilled or the liquid is processed to
decrease the concentration of PCBs. ‘This analysis mst
be repeated between 12 and 24 months after each such ser~
vicing to determine whether PCSs leaching out of the wind-
ings have increased the concentration to greater than the
maximm allcwed by the regulation...

5. he concentration of PCs in the dielectric liquid mst |

be reduced to less than 0.1 percent within three years of
the effective date of the regulation.

6.2 Present Ownership and Use

The ownership and use of PCS transformers installed in railread
locemotives and commuter cars is summarized in Table 6.2-1. ° Present plans ~
are to convert the electric power on the Northeast Grridor from Washington,
D. C. to New York City to 60 hz 25 &V by the mid-1980s. ‘The New Haven lire
north of New York Tay -be-converted-aterhr the isttss “As -a-resuit of this °
change, new transformers will be required in same of the cars, and the oldest
cars and locomotives will be retired from service. ‘The effects of this wl--. -

. tage change cn the transformers in each type of car is indicated in Table-
—6.2=1.-- - _ ee ee —

8.3 Tectnical-Aiternatives—for- Fé8s- in -Raiiroad Transformers

ee __..-PCBs have. been used in railrmad transformers to decrease fire
mineral-oit- in-this~eppbicatéen;~end~this~dees-net-eppear—to-result-in-an aenneennaa
aw ~immpascriah ly bazariout oti tion-——Thalapenesa tational adi med-ratmnftiled -
a tumber-of-lecemstive-transfommers-with-silicone-fluid-and has ccerated =~
them successfully for several years. AMTRAK has recently been testing an
experimental locomotive on the Northeast Corridor (built in Sweden by ASEA)

-27-



8.4 Summary
ate

Rebuild: 652 motors @ $3100 $ 2,021,000
Continuous Miners -
Premature scrapping: 16 operating

miners @ $40,000 640,000
40 other miners @ 0 = $40,000 to) - 1,600,000 |
. !
Reporting Cests - 18,000
Spill prevention and control slans 36,000
Total $ 2,715,000 -

{Plus up to $1,600,000 additional, All
costs will be incurred in the pericd
_ 1979 through 1981.)

Production and irice Invacts:

No less of coal oreducticn is enticipated. Since cal srices
are set by competitive market forces and are usually set by long texmm con-
tracts, it is expected that the additicnal costs of these regulations will
be absorbed by the mining companies as reduction in ‘profits.

7

Erm loumens ets:

cn in mine empleyment is anticipated. the require-
ments for additional reporting and the preparation of spill preventicn slans
will result in a total increased labor demand of cne t) two man years curing
1979. :



15.0 CAPACTTOR MANUFACTURING

The use of PC3s in the manufacture of new capacitors is expected to, end
by mid 1978 due to a mmber of factors including the ending of production
of PC8s by Monsanto in October, 1977 and the zero PCB discharge requirements
imposed on the mamfacturing plants by the EPA urder authority of the Federal
Water Pollution Control Act. Q)  powever , the decision of the capacitor manu-
facturers to discontinue the use of PC3s without attemting to develep
alternate sources of supply after Monsanto stopped production was made in ©
anticipation of the implementation of the Ban Regulations of Section 6(e) of
the Toxic Substances Control Act. Although the EPA apparently has no dis-
cretion in the implementing the ban on the use of PC3s in the manufacture of
capacitors, the econcmic impact of the change to alternate materials and
designs is undoubtedly the result of the provisions of the Act as imple-
mented by the proposed regulations. ,

15.1 Requirements of the Proposed Regulations

The proposed regulations would ban the manufacture of capacitors
containing PC3s after December 31, 1978 as the EPA has determined that the
ban in Toxic Substances Control Act on the manufacture of FC3s applied aiso
to the manufacture of items which are considered to be "PCB Articles” or
"PCB Equipment." .

15.2 Capacitor Production and Sales

PCBs have been used as a dielectric liquid in most of the alternating
current capacitors manufactured since 1930. PCS3s provided the advantage of
nen-flammability which is not available with electrically suitable alternative
liquids. The development and commercial introducticn of non-PCB capacitors
started in 1975 in response to growing concern over the environmental effects
of PCBs. The time required to develop various types of non-PCB capacitors

(L) EPA, "Final Decision,” Federal Register, February 2, 1977, pp. 6531-6555.

-96-



Increased Fire Losses”

It was implicitly assumed above that the high fire point liquids
are satisfactory replacements for PCBs in terms of perfonrance and fire saftey.
In fact, the high fire point liquids can burn under certain conditions including
exposure to an external fire, arr can release flammable gases if an electrical ~
arc occurs within the transformer. It will be several years until a complete
evaluation of the relative transformer fire risks is completed by the Fire
Safety Division of the National Bureau of Standards under a research project
currently being funded by the U.S. Department of Energy.

It will not be possible to accurately predicc the increased fire
losses that may result from the use of substitutes for PC3s transformers until
the work of the Bureau of Standards is complete. Any estimates made at this |
time mast necessarily be based on rather crude assumptions. It could be assumed,
for example, that the 20$ price premium for askarel transformers vs oil filled

‘transformers was justified by a decrease in fire losses. The use of a@ high fire -
point transfommer liquid might achieve 95% of the additional fire safery that
would otherwise be achievable by using askarel. The increased fire losses re-
sulting from the use of the high fire point liquid filled units would then be
one percent of the cost of the mits. Based on a production of 7000 new and
replacement units per year at an average price of $20,000 each, this loss
would be $1,400,000 per year,

16.6 Summary
Transitional Costs

Clean up costs for manufacturers. $160,000 1978 only

Long Term Costs

Increased cost of non-FC3 transformers $0 t $10 million
: . per year
Additional fire losses from use of

nen-PCB transformers $1,400,000 per year
(very rough estimate)

vise



most recent data, for 1972, are sumerized in Table 7.2-1, belcw:.

mare 7.2-1

Number of Licuid Cooled Transformers Manufactured: 1972

Sess ; Quantity

Overhead and Pole Mounted . 1,253,400

Pad Mounted 231,600

Small Power Transformers (less than

10,000 KVA) a *- 13,000

Secondary Unit Substation Transformers st ” 3,400
Large Power Transformers (above 10,000 KVA) ; 3,400 7 ..

Total .- 1,804,800

The nutber of overhead and pole mounted transformers currently inv ~~.
service-is not accurately mown, but an estimate of 30,000,000 tits is
‘usually accepted. in the industry. ‘These transformers. contain an average of
about 36 _galicns of oil each. Very few of these teansfomners have ever been

= - - 5
made only this type of transformer and never handled siskarel therefore, >
it is unlikely that these transformers were contaminated with PCB when.manie.——-
factured, and--the- units -ere- seldom serviced -in-the Stelt:- “The failure rate -

of” thése’ pole tinted transfomers is about 0.5% per year, OF gna goon Salted
units are rebuilt. No data have been found conceming the extent of 2B

a) Bureau of the Census, Electric#l Measurement and Distribution Eouip=
ment, Report No. MC72 (2)=30A, Table 6A.

(2) Consensus of opinicns of transformer nanufacturers contacted by Versar
by phone, 1978,

-37-



12.3 Sumary

Decontamination Costs

-79—

~ $200,000.



. LIST OF FIGURES

Figure No. see Ts , : Page
7.31 Decision Criteria for Analyzing Transformer Oil for

PCBs Sefore Disposal . ©... eee ee ee eee rr \)
13.0.-1 Distribution and Utilization of Waste Oil in the
United States During 1970-71. ......--. Lees 82
ix ~



This report is being released and circulated prior to the public
hearing on the proposed regulation. It will be considered along with the
information received during the hearing in establishing the final regula-
tions. Prior to final promilgation of the regulations, this study shall
have standing in any EPA proceeding or court proceeding only to the extent
“that it represents the views of Versar Inc. It cannot be cited, referenced,
or represented in any respect in any such oroceeding es a statement of
EPA's views regarding the impact of the prepesed regulaticns.

rs



TABLE 6.5-1

1976 Cperating Losses of Railroads Using PC3

Transformers
Railroad 1976 Operating Results Total Loss 1976
$ millions $ millions
conn cor) 19.1 operating deficit 22.3
3.2 MIA deprectaticn .
septa?) 1.25 cperating less . 7.6
no por @) 38.5 subsidy 38.5
avrnag (4751 442. total loss other than 478.5 (Este),

- NE corridor maint.
37.5 1/2 of $75 million less _
for NE Corridor operaticn

conpazz (6) : 205.5 losses for 9 months, 280 (Fst...
April-Dec. 1976

Total Lesses ; $ 826.9 -

(1) Metropolitan Transit Authority, Annual Report, 1976, p. 44. — -

(2) SEPTA, Report to the Public and Financial Statements for 1974
and 1975 - Statement of Qperations

(3) NO Department of Transportation, Hichlichts of Activities, 1976, p. 14. ~~~
(4) Amtrak, 1976 Annual Revort, pp. 6, 7, 28.

(5) Amtrak, Five-Year Corporate Plan, 1977, p. 158.

(6) Consolidated: Rail-corperation; -ammual Beport,,.1976e-EDe ly. 14,18. »-.



other types of machines would not be allowed to contime in service if the -
fluid contains more than 50 pom PCBs. The machines would have to be removed

from service by the effective date of the regulation and not used until the

PCB level in the fluid is reduced to a concentraticn below 50 oom.

10.2 Cwnership and Use of Contaminated Hydraulic Systems’ ,

A previous EPA sronsored study reported that sales of C3 hydraulic
fluid during the period 1970-1971 totaled over 13.5 million pounds to 585
different firms. (1) Except for a few companies with contaminated die casting
systems which have been identified through statements at sublic hearings on
PCBs, little information is available on the cwnership of contaminated systems
or the levels of PC3s in the Auid.

pased on staterents“nade by several die casting comanies ard by
a representative of the American Die.Casting Institute, (2) PCEs were used as
a premium priced alternative fluid in. the’ hydraulic systems of die casting

- machines used to form alumimm, magnésium, and zinc castings. There are

apparently few barriers to entry in this industry, and the constant entry
of new die casting companies has provided a ready market for used. machines.

A review of the Monsanto customer list reveals
the 40 largest companies purchasing PCB hydraulic fluid in

that about 80% of

1970 and 1971 were

die casting camanies.

(1)

Assuming that die casting companies ourchased 30%

of the Sluid sold and used it in die casting machines, a total or (13.5

y~ Versar ine.;-Usage-or PC8s—in Coen-and seni-ciosed-Systems-ars-the te —
 -Sulting iosses;ors2SSs..to. ches EnyimnmentrrtinsubLished rate Reporna cao eas
~- 68-01=3289,—Varsar. Report. No~47Ar 5C)__September. 30,..-- .- — —

(EPA Contract-
1976, p. 13.

au 25, ‘1978.

-65-



Price Effects

The impact of these regulations may effect almpst all die casting
and steel companies. Increased costs would therefore be expected to be passed
along to the consumers in higher product prices, although no individually
significant price increases are expected.

-74-



SEPA

United States
Environmental Protection

Agency

Pesticide and Toxic Substances
Washington, OC 20460

Office of Pesticide and Toxic Substances

Microeconomic
Impacts of the
Proposed ‘PCB Ban
Regulation”


Sales of PCB power factor correction capacitors in 1976 are esti-
mated to have been approximately $54.5 million. Assuming relatively: "|
constant output and demand, a ten to twenty percent price increase of com
parable nonm-FCB power factor correction capacitors will result in sales of
approximately $60.0 to $65.4 million (using constant dellars). Hence,
utilities and other users of power factor capacitors are expected to pay
approximately $5.5 to $10.9 million more.

Utilities employ approximately ninety-five percent of all power :
factor correction capacitors. The ability of utilities to pass all of the
additional costs associated with non-PC3 capacitors on to residential ard
commercial users in terms of higher prices will depend upon state regulatory
commissions' attitudes toward rate structures. Total revenue for all
electric utilities was $46.2 billion in 1975. It is estimated that total
revenue for all utilities in 1976 will have been aporoximately $50.0-pillicn. -
If all the utilities additional costs associated with using non-£CB capacitors
is passed on to residential consumers, and that their averace monthly. electric
pill is fifty dollars, it is estimated that residential consumers will incur
an increase in their electric bills of aporoximately .02 percent, or one cent
per month. [Note that this is the leng mm effect; in the short mn the
extra costs of non-PCB capacitors will appear as a capital item in the rate
base. If depreciation and replacement are both straight-Line functions, over
a ten year period, the rate base and the return on it will rise util the
tenth year at which point a small return on capital will be obtained as well
as capital replacement costs.] Since part of the costs will be sassed on to
industrial users, the relative price impacts will be even less, and are not
expected to significantly impact either the nrice ar demand for electricity.

-100-



17.2 Long Tenn Cost Impacts |
Transformers: (Chapter 16))

Increased cost of non-PCB transformers

Increased fire losses Data
Capacitors: (Chapter 15)
Increased cost of nom-PC3 power factor
n capacitors : $5.5
Increased cost of non-PC8 capacitors $7.8
Increased fire losses Data
Decreased service life Data

Diarylide Yellow Pigment (Chapter 14)
°
Increased cost of substitute pigments

Total

Present value of long term cost impacts assuming -

$l0_to 25 million/vear |

" $23 "to $6 million per year

10% discount rate = $230 to 560 million

17.3 Employment Impacts

Item_(Chapter)

No. of Jobs © (2979)

Total Man Years

PCB transformers)
Rebuilding
Railroad transformers (6)
Retrofill and decontamination
program
Oil Filled Transformers (7)

Analysis
Dispesal services

Mining Machines (8)
Spill Prevention Plans
Electramagnets (9)
Increased demand
Additional Labor for Operations
without Magnets
Hydraulic Systems (10)
Decontamination Program

-50

+55

“442 to 106
+69 to LO

+2

+50
+50

+12

-123-

~1470 +

+ 165

+1235 to 3118
+2029 to 3235

+25 to 32

+ 17

+ 24



This report was prepared by Versar Inc. for the Office of Planning
and Management of the U. S. Environmental Protection Agency. ‘the report
summarizes Versar's estimates of the probable costs and impacts of com
plying with the proposed "PCS Ban Regulations.” ‘These regulations were
prepared by the EPA Office of Toxic Substances and the Interagency PCB
Work Group to imlement the requirements of Sections 6(e) (2) and 6(e) (3)
of the Toxic Substances Control Act (poendix A).

This econemic analysis program was sponsored by the EPA, but the re=
sults reported are these of Versar Inc. This resort was prepared: in
partial fulfillment of the requirements of Contract No. 68-01-4771. ‘The
report is not a statement of EPA policy. However, this study does mest ©
the requiremnts of an economic impact amalysis of the promesed regula~
tion,

This report was. pumped. indec-the eperinicn of te acbect seatiny
Principal Investigator. Major contributors were: - ee ee
‘ Louis Fourt, Ph.D. (econemic methodology, waste oil, railroads) |
Robert Westin, P.E. (transformers, dry picments)

David Berkey (capacitors, mining
machines)

Bruce Weedeock (hydraulic systems, turbines)

Special. BRS STE must be given, for the -ciese-

tor manfactaere ar the electric utilities.



Table 15,3+1
Currently Available Non-5CB Power Factor
Correction Capacitors Se

Manufacturer Solid Dielectric Liquid Dielectric*

Westinghouse Paper and plastic film Iscpropyl bipheny?
combination

General Electric Paper Phthalate ester**

Sangamo Electric Co. Paper: Phthalate ester**

MeGraw Edison Plastic film Butylated monochloro-

diphenyl ether.

* All of the liquid dielectric materials contain srall amounts of additives
as free radical scavengers, etc. The identity of these minor constituents
is proprietary information.

** The phthalate ester based liquids reportedly contain a significant amount
of trichlorobenzene as an additive to raise the corona extinction voltage. -

_ induserial Canactiors

PCB capacitors have been used in a number of diverse industrial,
appliance, and lighting applications including are welders, induction heating
furnaces, fluorescent light ballasts, and television sets. Table 15.3-2
lists the manufacturing plants known to have used PCBs in the manufacture of
this type of capacitor in the early 1970s. Versar contacted these manu~
facturers in September, 1977 to determine whether they were still using PC8s,
and if so, when they anticipated ending their use of RBs. The results of
these contacts are summarized in Table 15.3-3.

All of these manufacturers plan to introduce non-PC3 capacitors
to replace the discontinued PCB products. In all cases, the new capacitors
will use liquid phthalic acid esters (phthalates) as a direct substitute for
POBs. As a result of this material change, an increase of 63 in the size of the

~10l-



lead times for replacement transformers could increase by the cost of two |
to three month's rental of an averace $20,000 unit or $800 to $1,200 per
failed transformer. Based on’ the assumed number and frequency of askarel
transformer failures, t5tal costs. due 3 lost service time would be ($800 x
140,000/3 = $37 million) to ($1,200 x 140,000 x 2/3 = $112 million), amd
annual costs of ($800 x 335 units = $268,000) to ($120 x 3,173 units =
$3,800,000) would be expected, with an average cost of (.5 x 4760 units x
$1000 rental per unit = $2,380,000) expected in 1979.

4.3 Economic Impact of Cost Increases

The increased costs to users of askarel transformers will be’ borne
by the owners of the units. Approximately one-half of the units are owned
by utilities, and their increased costs are expected to be factored into the .
rate base and passed along to the users of electricity. ‘The other nali of
the units are owned by major office and apartment buildings and by shopping

centers, factories, and’ other establishments.: Increased facility maintenance ~ -

costs would be incurred by a large mmber of facilities. Significant micro-
econemic impacts are not anticipated, and no changes in the level of amploy-
ment from microeconamic effects is expected.

4.4 Summary

Compliance Costs 1979 Total .
Foregone savings fran $2,000,000 to $19,000,000 $280 million ‘to

rebuilding om - ($14,280,000 best estimate) - a7 $560 million
Lost service time $268,000 to $3,800,000 $37 million to

($2,380,000 best estimate) $112 million
Total $2.3 million to $23 -million $317 million to
7 $672 millicn “:

Empioument effects: Some short tem lay-offs possible due to lack of back

up transrommers. Impact may be limited to small manufacturing firms.

-22-



Table 13.0-1 1
New Oil Usage and Waste Oil Availability for Recycling in 1975! )
U.Ss Sales Fraction Used 1
1975 Availabie* available
‘Dre of O11 Outlet or Use . (gal x lo") fer Feccle «= for Recrelica
Automotive Lube Oil Sexvice Staticns 239° +63 150
Comercial engine
2s ro) mw
New car dealers 103 +90 93
Auto Sleat ad cther
ithe oil uses iL 50 73
Ratail sales for =m
mercial engines 95 «$3 60
Garages, auto supply
piece 30 63: st ST
250 2 35
Facey | its ( (aus & - - ‘ .
fam equinnent) 34 +30 49
Subcotals peel e348
incustxial @ Aviation L -
Lube Oiis Sydsmlic § Grci-
lating system sits 3l4 ws mm
Metal working oils 145 +70 . 301
aviation & cther 147 rl . cs
Gas engine oils 60 +30 34
Railroad engine cils 33 353 32,
Subtotals 724 Tt
Other iné:stmial Cils Elecmiaal oils 62 +90
. Process oils 340 10
Racsigeration sils. pal a
Subestals TI .
lube Oils Poscased
‘sy 0.3. Goverment 2 30
GaND TCIALS 2,376 1154

Wraction availaole ff Teeicling atter

issses in use ané to envirorment.

(1) Neinstein, Norman J., (Recon 5S
Distosal, PR-670/2- 74-282, rieesn, Ww

Waste Oil Fecvelinc anc

xe 7 Late

-81-



11.2 Qwnership and Use of Contaminated Heat Transfer Systems

There is no data available on the total mmber of heat transfer
systems which have used PCB based fluids in the past. However, a review of
Monsanto's customer list for 1970 and 1971 indicated that 8.2 million pounds
of PCB based heat transfer fluid was sold by Monsanto during those years to
a total of $33 different firms, [)

The present concentration of PCBs in the heat transfer fluid in
any of the systems which previously. used PCRs depends on how thoroughly each
system was flushed when the PCB fluid was replaced ard the amount of leakage
and topping off that has cccurred since then. Data on present PCB levels is
available for only one system: a 14,000 gallon capacity PCB heat transfer
system was drained and flushed in 1972 and refilled with a non-FCB fluid;
the system has been in constant use since 1972 and presently contains fluid
that is contaminated with two. percent PCBs. (2)

Lacking any additional information, it mst be assumed that mst
of the 533 companies which purchased PCB heat transfer fluid are still operating
the systems and that most of these systems are contaminated with PCBs in
excess of 50 prm. It must further be assumed that the use of these systems
is central to the manufacturing processes in which they are used, whether
for drying, heating, or temperature contrel in exothermic processes.

11.3 Compliance Costs

It is not possible to estimate the total costs cf decontaminating
the existing heat transfer systems to comply with the requirements of the pro-
posed regulation because neither the total number cf systems nor their
capacity is known. In principle, the costs of draining, flushing, and re-
filling the systems should be about the same per gallon for heat transfer
systems as for hydraulic systems (see Section 10.3).

(1) Versar Inc., Usage of PCBs in Open and Semi-closed Systems and the
Resulting Losses of PCBs to the Environment, Unpublished Draft Report,
(EPA Contract No. 68-0l-3059, Versar Report Mo. 474-5C), September 30,
1976, p. 9.

(2) Confidential information obtained from the user of the system by Versar
@uring a telephone survey of major users of PCS heat transfer systems.

-76=



1.2.1 Production ‘of PGs =~

The major U.S. manufacturer cf PC2s has been Monsanto.
Since 1972, Monsanto has limited sales of PCBs to manufacturers of trans-
formers end capacitors. Monsanto ceased manufacturing PCRs in mid-1977,
and shipped the last remaining inventory by October 31, 1977. A previous
EPA sponsored study! indicated that about one millicn pamds of Ps
were also manufactured by a small chemical company from 1972 through 1974
for use as a heat transfer liquid. ,

PCBs may also be made as wnintentional by-preducts of
other chemical processes. For instance, the manufacture of the ay pige
ment phthalocyanine blue by reaction of precursors dissolved in: trichlaro-
benzene may result in the formation of PCBs from reacticns involving the
trichlorobenzene. These PCBs nay contaminate the pigment at PCB concen- ~
trations from parts per million to as much as 0.1 percent. Production of
diarylide yellow pigments also results in the férmation of dichlorcbipheny!
cue to a side reaction involving the pigment precursor dichlorobenzidcine.
This results in PC3 concentrations in the yellow pignent of wp to several
hundred parts per million. Chlorination of. water which contains appreciable
concentrations of biphenyl (which is used as a dye carrier in dying poly-
ester fibers and which is a common pollutant of water discharged from dying
plants) can result in the wmintentional fommaticn of FC@s t© a concentra
tion of several parts per millicn. No natural (mcn-industrial) sources of
PCBs have been identified,

(1) Versar Inc. Usage_of PCBs in Coen and Semi-Clesed Systems and _
the Resulting Losses or PCSs to the Environment. =PA 5 T=
009 (Carpublished Drart Report) September 1, 1976.



9-

PROBABILITY THAT OIL CONTAINS GREATER
THAN 50 ppm PCBs

100 ~

80 4

59 60.2] !

so — new anceccccncnccunnsnccnngelccnecnccnvacseccccnnecccneeas
40- DO NOT ANALYZE

32 —pesensneccececesanseccecssensesnsccccccncecececscsenaA ccsececcusncacancnacscscnensacssssnssesseces
20 4 ANALYZE
o T T + T T T T

0 50 100 150 200 260 300

GALLONS OF OIL IN TRANSFORMER @ 8.1 th/gal.

FIGURE 7.31 DECISION CRITERIA FOR ANALYZING TRANSFORMER
+ QIL FOR PCBs BEFORE DISPOSAL



(2) Use synthetic road stabilization chemicals which both reduce
dust and provide surface stabilization. The increased cost of this type of
material is presently offset by lower road maintenance costs. on heavily: -
traveled dirt roads at mines and other industrial facilities. Savings in
maintenance on lightly traveled roads would be less significant ané would
only partially offset the increased material costs. A typical synthetic
material is "Ccherex", manufactured by Witco.Chemical Co. This material is
an organic resin in a water emilsion which is sold fer $1.25/gallon, and
applied after a 5 to 1 water dilution at a rate of one gallon per scuare yard.
Increased costs. incurred by the use of this material would be:

Coherex: 1/6 gallon per square yard @ 1.25 = .208
minus: Used Oil: 1/2 gation per square yard
- @ 0

= 204

equals: increased material cost per square yard. , +168
x 14080 sq. yds. per mile of road 24 a :
feet wide 2 = $2365 per mile -. - -
x 45,000 miles = $106 million per year.

These increased costs will be incurred until the conéentration of
PCBs in used motor oil drops below detectable levels. In perhaps five vears, i
may be possible to use waste motor oil for road oiling with little chance of
releasing PCBs <0 the environment, provided that care is taken to avoid using
waste industrial oil. The diverted industrial oil can be made up at mdest
added costs by more extensive collection efforts particularly in rural areas.
The costs of obtaining this replacement motor oil fer read oiling consists of
costs to persuade service stations to accept used oil from persons who change
oil themselves, and perhaps either greater storage capacity at stations or more
frequent collections. Altematively, collectors could travel further in rural
areas ard thus visit mre service stations mor now part of the recycling systems.
These extra costs will not be incurred unless road oilers will accept necessary
price increases to cover these costs. Total costs might reasonably be expected
to increase .02 per galion ($6.4 million per year) plus the risk of inadver-
tently using contaminated oil in occasicnal instances. After an additicnal ten
years, it may no longer be necessary to segregate the industrial oil, and
costs would return to their present levels.

-88-



Present 703 Levels in Die Casting Machine Hydraulic Systems

Company ; PCB Level (rom)
Cast Forge Co. (1) 80

Caterpillar Tractor ‘2) below detection limit (systems
are drained twice a year)

Outboard Marine 9) . 90-6000 (currently averace 500)

Qutboare Marine Corporation owns approximately 130 die casting !
machines that at one time used FCS hydraulic fluid. These machines each
contain an average of 500 gallons of fluid, QB) ara are all contaminated with
CBs in concentrations above 30 cum. : a

Several companies provided estimated costs for replacing hydraulic
fluid, although rot all of the £: igures were for the permitted draining ahd a
flushing procedure. Cutboard Marine estimated a cost of $340,000 £9 drain
their machines, flush them twice with mineral oil, and refill then with new
hydraulic fluid. _-I£_hydraulic ¢luid were-used_as the: Hushingsolwtion t.....
avoid flanmebility sroblens the cost would be $1.2 million. ‘# ii

General Motors stated that the cost of materials for raplacing
the Zluid in their hydraulic systens would be as follows: (3)

(1) Telephcne conversation, Tom Grover (Cast Forge Co.) with Bruce Woodcock
(Versar) , September 22, 1977.
(2) Telephone: conversa’ Yy Tem gerleer (Caterpillar Tractor) whey Bruce
a Nocdcocles (Versar).>=SemtembexsD 2 O27
Tamas, Hugh-(Cutbeard Marine-Corp-);—Sresen
Hearings cn the °C3 8an Regulations, Washington, D. c., Sely ab, 1977
(p.. 91 of, transcript) .
(4) Telephone conversation, Hugh Thomas (Quthoard Marine Corp.) with Bruce
Weedeock (Versar), September 23, 1977.
(5) Ward, William (General Motors Corporation), Presentation at the EPA
Hearings on the PCB Ban Reculations, Chicaco, Illinois, July 19, i977,
(p. 201 of transcript).

-67-



“8z-

Omer
SEITA
SEPTA

Serra

SETA

* (teadliyy)
“ (ead)
NJ por

NJ por

NI por
MIA

Conn, bor

Mi. bor ,
Conrall
: Oonrath

Oonvall

Antrak
Autcak
uotvak

Draft: Repor

‘Haein Cattbe

buip, Wentification*®

Bo
Sliverdinar 1
Sitvartjnar 2
divert iyee 9
Bilvertinor 4
Blivert ier 2
Sliverliner 4
yerosy Arrow t
wevsuy Aveow 2
Gare”

t ,
H2

: 1
yf? !
keo
or
3d

kas

i .
gar

£ 60

bevol incr

TABLE 6,2-1

Railroad PCD ‘ransformers

balp. ype

om,

1200
100
1400,

1000

1000
100
oa,

Transformec
Effect of vol- Capacity, ‘Transforwer Transfomer Ne-
Maber® — tage Change* Gallon fwtroflll Cost placenzat Oout
46, Scvap In mld 808 - $ 5,000 $ 50,000
5 Scrap or replace - 5,000 334,000
trang, in wid 190ps .
37 tepdace trana wld - 5,000 64,000
19008 . : .
200 feplaca trang mid = 5,000 64,000
1obos :
10 tne - + $,000 © 65,000
AD one - 5,000 “63,900 *
lua None - 5,000 63,000 -
a Now - 5,000 65,000
70 tone - 5,000 65,000
1) Scrap fa mld 19008 - 15,000 105,000
qa Neplace trans late - 5,000 $2,000
in 1940 :
421° Weluco rans late | ~ 5,000 52,000
in 19800
8 tone no 14,000 160,000 .
530 Sevap ta mig 19003 - 15,000 185,060.
10° We place trans ia. 500 10,000 157,000
mid 19008
66 Replace teans da su0 106,000 142,000
wid 1900
40 Scrap in mid 39803 15,000 185,000 *
54 None . no 44,000 160,000 ,
60 tteplace “4 trans 255. 5,000 120,000

by mid 19a, ret ok

1
‘arson, Electric Miltipls Unit Car at toowitive Qoaveralon for Dual Voltagg —

Bust Propenty Operacion,

‘ :

(tor eA NE Odorldor Project), Septesber, 1977,



generally smaller mits. .Estimatas by imcwledgeable industry rebresentatives
omtacted by Versar suggest that berhams 80% of the total volume of oil in
transformers other than pole mounted mits is in units awed by utilities.

Number of Contaminated il-Filled Trensformers

The cnly available information on the extent of C3 contamination
of oil-filled transformers is the results cbtained by one major transfommr
manufacturer which analyzed the oil from 55 tmits. This oil was teken Sum
distribution trensfommers and power transformers, and in a few cases from
bushings cn transformers. Based cn the results of quantitative analysis fer
PCSs in the oil, 25 of the 55 transformers were contaminated with Pas in
excess of 50 prm in the oil. ‘The concentration of PC3s in the samples.
varied from 5 ppm to 155 pem. This sample was taken on the basis of conven~ .
ience, and probably dees not represent an unbiased sample of all oil filled
transformers presently‘in use. In addition, it is not known how any biased
may affect the accuracy of extrapolating the above data t all oil filled
units. If this sample were unbiased, it would indicate that 45% of all oil
filled transfommers were contaminated with-PC@s:in excess of 50 ppm. The
95% confidence interval for this estimate is from 32% to 594 of the trans-
formers presently contaminated with PC3s above 50 smn. ,

No Gata is available on possible contamination of the 30 million
pole top-transfomers; armtit-is mot possible to-calculate the’ effect of the
PCB ban regulaticns on these units until this informaticn is available.

Based on the results of the small and possibly biased sample described above,
it would appear that possibly as many es 2,200,000 oil filled transformers -
could be ‘continttated witt SCas' at “cohcetitrattions above-St-pam, that-nen-———
of these transformers ars contaminated at levels above 500 pom, and that the
transformers. contaminated at.Levels. above -50- sem contain about 6067560 /000 «> «
gallons of oil. At an average concentration of 80 prem PCBs, this would
suggest that the material affected by the regulaticns consists of 384,000
pounds of PCas dissolved in 4.8 billion pounds of oil. °

-40- oF



16.0 TRANSFORMER MANUFACTURING

Liquid filled transformers containing a PCS based liquid known generically
as 'askarel' have been used for many years in those installations’ where the :
risk of fire justified the use of a fire resistant fluid. Askarel transformers
have been allowed to be installed in hazardous locations such as in buildings
without the requirenent for a fire proof vault or fire sprinklers. No sub-
stitute transformer licuids have vet. been developed which have fire resistant
Properties equal to the PCS based askarel.

16.1 Requirements of the Proposed Regulations

The proposed regulations would prohibit the manufacture of new
PCB tranformers after Decetber 31, 1978, but classify continued use of existing
PCB transformers except. those used in railroad locomotives as use in a totally
enclosed manner. ‘The regulations would authorize certain minor maintenance of.
existing transformers for five years after the effective date of the regulation
but would prohibit major rebuilding of failed‘umits. It is assumed that ~ -
authorization for minor maintenance would be granted on request after the five
year servicing authorization has expired as such maintenarce decreases the
risk of catastrophic failure of transformers and minimizes the risk of loss of
PCBs to the environment. Disposal requirements for failed askarel transformers
are specified by the PC3 Marking and Disposal Regulations, and these require: .
Ments would not be changed by the proposed PCB Ban Requlaticns.

16.2 Industry Structure, Production, and Sales

A review of Monsanto's custamer list for PCBs in the early 1970s
indicated thirteen companies which used PCBs to manufacture askarel trans-
formers. These companies and the location of their transformer manufacturing
plants are listed in Table 16.2-1. Production of askarel transformers averaged
5000 units per year in the early 1970s. When these companies were contacted
by Versar in September, 1977; only.one manufacturer was still producing askarel
transformers, and it anticipated ceasing production of this type of unit prior
to the end of 1977. All of these manufacturers produced both oil filled and
askarel transformers in the same plants. Oil filled transformers are inter-

-109-



TO

the "PCS Disposal Regulaticns." ‘The incineration cost of $.0632 ber pound
of contaminated oil is similar to the lower bound estimates’ of prebable’
market prices reported informally by presently operating chemical waste in-
cineration companies. Transportation costs incurred in delivering the oil
to the incinerator would be about $.02 per pound based on costs previcusly
calculated for askarels, ©

Compliance Costs

The effect of the prepesed regulations will be to require the in
cineration of ofl contaminated with PC8s. Control of the disposition and
use of used transformer oil will require the analysis of oil for PCSs.
Analysis of oil for PCBs will only be economically justified if. the expected
value of the savings in disposal costs if the oil is not. contaminated exceeds -
the cost of analysis. For instance, it would cost $75 to sample and analyze
the oil in a transformer that has a 453 extectation of being contaminated ~
with PCBs at a concentration in excess of 50 opm. The value of oil to the
transfomrer owner is zero if the concentraticn of 2c@s is less than 50 com
(i.e., a commercial collector will be willing to pick it and haul if away
for free). Disposal would cost $0.0832 per pound for trensportation and in-
Cineration if the oil is contaminated above 50 com.” The expected savings
to be obtained by analyzing the oil would be equal to (0.0832/lb x mumber of
pounds of oil x probability the oil is not contaminated with more than 'S0 —
pom PC3s) minus the cost of the analysis. Analysis is therefore a gcod in-
vestment for large transformers and those transformers less likely to be
contaminated with PCas. This relationship . is presented in graphical fom
in Figure 7,3-1. .

(1) Versar Inc., Microeconomic Impects of the Proposed Marking and
Disposal Requlations for PCBs. (EPA Report No. 560/6-77-013) ,
Spring es Va.: National Tectnical Informaticn Service QrrS

+ FB-267 933/2WT) April 26, 1977, po. +19.



REFERENCES
Assessment of Industrial Hazardous Waste Mensgement Practices, @ document pre-
pared for EPA's Office of Solid Waste ami presented with testimony of #.
Lanier Hickman, December 12, 1977.

Amtrak, 1976 Anmual Report.

Amtrak, Five-Year Corporate: Plan, 1977.

Bureau of the Census, Electrical Measurement amd Distribution Equipment,
Report No. MC72(2)-36A, Table 6A.

Consolidated Rail Corporation, Annual Report, 1976.

Dow Carning Corporation, Removal of PCB from Dow Coming se.) prensfomer
Liquid by Charcoal Filtration, updated.

Electrical Apparatus Service Association Inc., 19771978 Yearkook; St. Louis
MO: 1977.

ENSCO, General Information ENSCO-PCB-001 Rev. 3-78, El Corado, Arkansas:
March 1578,

A, “Final Decision", Federal Register, February 2, 1977, pp. 6531-6555.

a, "Polychlorinated Biphenyls (PCBs): Disposal and Marking", Federal
ister, February 17, 1978, pp. 7149-7164.

Foss, Stephen D.; Higgins, John B.; Johnston, Donald L.; McQuade, James M.-
(General Electric Co.), Retrofilling of Railroad Transformer, Draft Final”
Report, Contract DOTTSC=1293, July 1977. *

Hofstader, R.A. (Exxon Research and Engineering Co.); Lisk, D.J., Bache, CA.
(Cornell University), "Interference in the Electron-Capture Technique for —
Determination of Polychlorinated Biphenyls by Sulfur-Containing Canpounds in
Petroleum Products", Bulletin of Envirormental Contamination and Toxicology,
Vol. 11, No. 2, 1974. , ~

Kuratsune, Masanori, et. al., "Yusho, a poisoning caused by rice oil con
taminated with polychlorinated biphenyls", RHSMHA Health Reports, Vol. 86,
No. 12 (December 1971), pp. 1083-1091.

Lapp, T.W. (Midwest Research Institute), The Mamifacture and Use of Selected
Aryl and Alkyl Aryl Phosphate Esters, EPA 560/6-76-000, rebruary L976.



7.3 Costs of Comlying with the Proposed Regulations

the proposed. regulations do not affect the continied use and naire
tenance of oil filled ttansformers: that are. contaminated with PCBs in con
centrations belcw 500 ppm. Disposal of oil contaminated with PCs in excess.
of 50 ppm will be allowed only by approved chemical waste incineration. Com _
pliance with these regulations would require that contaminated trensforters
be identified by analyzing the oil for PC3s, and that the oil frm these
transformers be disposed of in a special incinerator. Costs will be incurred
for sampling, analysis, and disposal. .

_ The cost of disposal of PCB liquids wes investigated in an EPA
sponsored study of the ecoromic impacts of the PCB Marking and Dispesal
Regulations. the following costs for disposing of contéminated ‘trens+
former oil are develeped from these previously reported costs.

Sampling and Analysis to: . tek
Determination of the PC3 content of transformer oil requires that
a sample of the oil be analyzed by an experienced. laboratory using a sas
Chrematograph equipped.with.an-electron.capture_detector.___ Most. liquid.
filled transformers have a provision for obtaining a sample Of the oil.
Assuming that a transformer has a drain cock which can be used to cbtaina __
sample of the oil, the cost of cbtaining the sample should be little different
than the cost of applying a label calculated. for the. marking reguiations.%)
Present commercial charges for the required analysis are $60 per sample for
quantity orders of six to eleven. samples analyzed at one time.) rder
processing and shipping costs of $50 per order of ten samples would be in>
. Curred by..the-transiormmer..cumern,—resulting. ina.total costiof analysis.of wo.
$67 to $80 per Srensfoemer tn 4 soucing-sameing: and analesis:SEogramis— Leas

(1) Versar Inc. Microeconomic Impacts of..the Proposed Markine and Disposal.

Regulations tor PCBs, (HPA Report No. 560, @-17-015), Soringtield, Va.:
National Information Service (NITS No. PB-267 333/2NP),
April 26, 1977.

(2) Versar Inc., Price Schedule - Quantitative Analysis of PCBs in lo-c

Transformer Oil (Price Sheet 100), Springrield, Va.: May I, 1978.

<41- , oF



Table 10.3-3
Estimated Cost of Decontaminating Hydraulic Systems

Cost per gallon

500 gallon 2700 gallon
systen _o-systen
New Hydraulic Fluid) 7.80 7.60
(phosphate ester)
Flushing Fluid!) - 1 gai/gal 1.15 1.15
(lew viscosity mineral :
oil without additives)
Transportation (2) 241 : 241
(400 miles, includes
flushing fluid)
Incineration - $.15/lb 2.85 2.85
(includes flushing fluid) . .
(2 man days per machine 48 209
at $15 per burdened man heur) : -

Total “12.69 12.10

(1) Telepnone conversation, Jchn Colucci (E.F. Houghton) with Bruce Woodcock
(Versar). April 27, 1978.

(2) Versar Inc., Microeconomic Impacts of the Proposed Marking and Disrosal ©

Regulations for ?C3s, Springfield, Va.: National Tecnnical tnrormaticn
Service (NTIS PB 267 833/2NP), April, 1977, p. 3-20.

=-70-



13.0 RECLAIMED OL

Approximately 1.3 billion gallons per year of used oil is collected. Zor
use as road oil, fuel oil, re-refined hydraulic oil, and re-refined lubricating
oil. Much of the waste oil previously used in applications other than auto-
motive lubrication has been contaminated with low levels of PCBs, and dissipative
uses of this contaminated oil can introduce PC3s directly into the environment.

A total of 2,376 million gallens of new oil were sold during 1975, the
major camercial uses being automotive lubrication (50.8 percent); industrial
and aviation lubrication (30.5 percent); and other incustrial uses primarily :
in materials processing (17.4 percent). ‘The amount available for collection
and recycle was estimated to be 1,154 million gallons, or 48.6 percent of
total sales. Data on U.S. usage of new (virgin) refined oil and availability
of used oil for recycling are presented for the year 1975. in Table 13.0-1. 2)

Data generated by Recon systens'?) for a,12-month period during 1970-71
indicate that, out of a total U.S. production of 2,480 million gallons per
year, approximately 901 million gallons, or about 36.3 percent, were actually
collected for recycling or use as fuel. An additional 601 million gallons
were estimated to be used on roads (application for dust control and possibly
in asphalt) or as fuel oil; this used oil could conceivably have been col-
lected for recycle so that the maximm amount of oil available for collection,
based on the Recon Systems estimates for 1970-71, may be as mich as 60 per-
cent of that produced.

A flow chart showing the distribution and utilization of waste oil in the
United States, based on the 1970-71 data of Recon Systems, is presented on
Pigure 13.0-1. Summary data for disposition and usage from Figure 13.0-1 are
as follews:

(lL) Adapted from Table 1, page 24 of Assessment of Industrial Hazardous Waste
jement Practices, a document prepared for EPA's Orfice of Solid
Waste and presented with testimony of H. Lanier Hickman, December 12, 1977.
(2) Weinstein, Norman J., (Recon Systems, Inc.), Waste Oil Recvcling ard Dis-
posal, EPA~670/2-74-052, Princeton, N.J.: August, 1974.

-80-



TABLE 6.5-2
Labor and Overhead Costs of Retrofill and
Processing Program: for Railroad Transformers

Total capacity of transformers:
$7,043,000 retrofill cost/$20 per gallon = 352,150 gallons

Labor and overhead cost of each retrofill or.
processing @ 4.58 per gallon = 352,150 x 4.58 = $1,613,000

Total labor costs for one retrofill and two :
processing of each transformer . 4,839,000

Labor and overhead costs of 3 additional analyses
per transformer @ 50%. of $75 test price:

1,009 unite x 3 tests per unit x $75 per tant 2508 = 114,000

TOTAL LABOR AND OVERHEAD COSTS ~-$4,952,000

TOTAL LABOR DEMAND 4 $30,000 PER... -_. -
BURDENED MAN YEAR 165 man years _.

Boonomic Impacts:
Increased costs are expected to be raid from covernment
—-—-———-subsidies— —

Employment:

An increased employment totaling at least 161 man years
. is. anticip. (O05 ne eT

=35- Do.



-T7T-

Iban {Quapter)

PCR ‘Transformers:

Manufacturer clean up costs (16)

Ban on Rebuilding (4)
Foregone Savings

Lost Service The

_ Transformer Service (5)
Lost Wages
Spill Prevention Plan
Locomotive ‘transformers (6)
Ratrofill Program
Processing Program
Final Analysia for PCBs.
Reporting
Spill Prevention Plan
FCB Capacitoce
Equipment: Redesign (15)
Inventory Cbsolescence (3)
OL} Filled Transfonners (7)
WCB Analysis atl Disposal

Mining Machines (8)
Retasld Loaders
Scrap Continuous Miners
Reporting Costa
Spill Prevention Plans

ble 17.1-1

Transitional Cost Impacts

$ HILion Per Year

‘pata not available to support estimate; probably small cost dupact. |

Eat inated
Succeeding § HILLion Reliability
1979 Yeara aotal of ‘utal
ee | 0 a ~508 +5008
4.3 2.48 less 420 2500
per year
24 3.4% less 75 3508
° per year .
1 o 1 11008
1 o . fiooe *
7 0 7 1200
0 2.7 (2 years) 5.4 2208 :
0 . -.1 983) a #208
-005 0 -005 21008
-02 " o -02 1508
.
1 ) L 11008
Py “3.44 less 700 2308
ver year
Gmplete by Doc. 2, 1991 2 1208
Gmplete by Dec. 31, 1981 6 1508.
02 . ‘0 02 11000
04 ot 0 04 2508
c
‘ :
, :
_ 4 aot
fo tome
,. eet



sition of supplying a unique product having a low price elasticity of
« The anticipated regulations presented a high barrier. to entry into

this market for other possible manufacturers of PCBs, so Monsanto was ina
monopoly position, and their pricing may have reflected this market conditicn
in addition to general inflationary pressure on all commodity prices during
this period. The net effect was to increase the price of PC3 caracitors
above what would have been expected under long temn competitive conditions
had there not been the threat of regulatory action on the manufacture and _
use of PC3s.

At present, both PCB capacitors and non-PCB capacitors are
available, although from different manufacturers. The non-PCB industrial
capacitors are selling for about ten percent more than the PCB units having~
the same functional characteristics. Since the- manufacturers of non-PCB
capacitors do not have the option of producing PCB mits, this price in-
crease may reflect the premium which users are willing to pay for avoiding
any possible impacts of the ban regulations on their operaticns and inven-
tory rather than reflecting increases in manufacturing costs. Squilibriim
pricing would not be expected to result until 5C3 capacitors were no longer
available.

The demand for capacitors is highly inelastic, because clese sub
stitutes are not available and the number of uses to which caracitors mav
be put are limited. Consequently, capaciter users will be confronted with
prices for non-FCB units which reflect the additional costs of production
of such units due to the proposed regulaticn. The increased price of PCB
capacitors and the present competitive pressure cn the price of non-PCB
capacitors suggests that the long term price increase due to the banning of
PCBs will be more than the present differential of 10 percent. A total
price increase of 50 to 20 percent is perhaps a more reasonable estimate of
the price increase for non-?CB capacitors.

-105-



about equal in price to askarel-filled transformers of the same kva rating. ~
However, the following limitations prevent open-air-cooled transfommers from
being considered for many applications using askarel-filled transformers:

Heat capacity: The power drawn from a transformer usually
varies over a wide range.. The rating of a transfomrer is established by the
power it can harmdle continuously without over-heating. If a licuid-filled
transformer is operated at overlead conditions for a short period of time, the
licuid will act as a heat sink, absorbing the excess heat produced in the trans-
former without a rapid increase in temperature. The result of this thermal
inertia is that licuid-filled transformers can cperate at outputs of up to 200
percent of rated capacity for a period of one to two hours without damage.
Air-cooled transformers do not have this heat sink effect and are limited to
operating at a maximm service rating not much higher than the continuous
rating. Where the current draw on the transformer does not vary greatly during
the day, this limitation is not a problem. However, in most cases the varia-
tion in load requires dry transformer to have a 20 to 30 cercent greater capac-
ity than liquid-filled transformers in the same application.

Dielectric strength: The liquid colant in a Liquid-filled
transformer also provides a significant level of electrical insulation between
the various current carrying components within the transformer. Air has a much
lower dielectric strength, and open-air-cooled transformers are limited to a
maximum voltage of 25 to 40 kv.

The problem of electrical insulation is even more severe
if the open-air-cooled trensformer only operates intemnittently. When the
transformer is operating, the heat generated within the windings keeps the
insulation dry, and maintains a high dielectric strength of this solid insula-
ting material. However, when the transformer is not operating, the coils ccol
to ambient temperatures and the insulation can absorb moisture from the air
which reduces its dielectric strength. Open air-cooled transformers mist be
thoroughly dried before being put into service after each cool period.

-114-



Employment . , : -
Increased demand for replacement transformers should generate :

employment equal to that lost in the transformer’ rebuilding segment of the
industry (see Chapter 5). An additional 78 jobs would be expected in 1979.

vile



This document is available in limited quantities through the U.s.
_ Environmental Protection Agency, Office of Texic Substances (WH-794), 401
_M Street, S.W., Washington, D.C. 20460.

This document will subsequently be available through the National
Technical Information Service, Springfield, Virginia 22151.

this repent has been review by the Office of Planning and Manage- _
ment, U.S, Environmental Protection Agency, and approved for publication.
Approval, dees: not: signify that the contents necessarily reflect the views
and policies: of, the Environmental Protection Agency, ner does menticn.of _
trade names: oF commercial products constitute emiorsement or reconmercation
for. use.



Annual estimates of capacitor sales volume are available on an -
aggregate basis from a 20% survey of manufacturers at the five digit SIC ecde
level. ‘The recent information available from this source is summarized in
Table 15.2-2.

table 15.2-2')

PCB Capacitor Sales - by Year

Year Sales - Million Dollars
1972 a 112.4
1973 143.2
1974 157.3
1975 119.3
1976 149.0

(1) Sourca: U.S. Department of Commerce

15.3 Compliance Costs

There are two basic technological alternatives available to capac-
itor manufacturers who must Gevelop non-PCB capacitor product lines. The
direct, amd probably short term, solution to the problem is to develep a di-
electric liquid: which can be used as.a direct replacement for’ PCBs within the
presently used technology of capaciter production invelving aluminum foil and
paper as a solid dielectric. This type of construction has been develored to
maximize the advantages achievable using PCBs as a liquid dielectric. An
alternative approach would be to develop a new technology which makes optimm
use of the materials remaining available to product designers.

Much effort has been spent in evaluating materials for use as
PCB substitutes in both the U.S. and in foreign countries. No substitute
liquid has been developed which equals PCB in dielectric proverties, fire
resistance, and stability. Any trade-off entails enhancing electrical per-
formance at the expense of environmental or safety considerations. Impregnating
capacitors with alternative dielectric fluids and/or redesigning then may

-98-



Revorting Costs

The proposed regulations would require that the SPA be informed of
the identity and ownership of each PCS mining machine within 90 days of the
effective date of the regulation, and that the cwners maintain: current
records of the machinery and report changes of cwnership to the EPA. ‘There
are approximately 96 mining companies which cwn PCS machines. ‘The inform-
tion required for the initial report should be available irom inventory
records, and preparation of the report should require no more than one to -
two days per compeny. Assuming an averace of cne and cne-nalf man days cer
company report, and an averace burdened labor rate of $30,000 ber man vear,
the. reporting requirement will result in costs of (96 companies x 1.5 man
days peif company x $30,000 per man year/240 man days per men year = $18,000).
The othée record keeping requirements are similar in secpe to normal inven~
tory procedunes . and should not result in significant additional costs to
the mining companies. ~

Sotli Prevention and Controi Plans

A formal contingency plan will be required of each company which
operates PCS mining machines. ‘This plan will have i) be specific for ak
company, and will have to be reviewed and approved by a registered profes-
sicnal engineer. A sample plan for these machines will be prepared by
Versar Inc. under a contract sponsored by the U. S. Bureau of Mines. Using
this published plan as a basis for the preparation of a specific company plan
should reduce the effort to one day of company time and cone day of profes-
sional engineering services per company. This will result in costs to the
mining companies of (1 man day x $30,000 ser man year/240 man days per man
year + 1 day consulting x $250 per day = $375 per company). for the entire
industry, total costs willbe (96 companies x $375 per ciimany = $36,000).

-58-



annual Coerating Costs for Contaminated oil Incinerator

Plamt Capacity: $00. gal/hr. (4,000 lb/hr.)
Coerating Factor: 7,300 bours/year

Annual Capacity: 3,650,000 gal/vear ( 30,000,000 ib oil/year)
Capital Investment: $3,210,000

Variable Costs:
Direct Operating Labor, 2 men/shift @ $10/nr. $175,000
Supervision & Administration @ 503 of direct ; ae
Cperating Laker : - . ~ 87,000
activated Carbon systenTM) 122,000
Maintenance @ 20% of capital investment © : 640,000
Power: 100,000 SHH @ 3¢/RiH ~ 3,000
Sampling and ‘Analysis : _ 100,000
: , _- $1,127,000
Fixed Costs: : :
Retuzn on Invested Capital (103) 321,000.
Capital Recovery (10 years @ 10%) 321,000
Taxes and Insurance (4% of capital cost) 128,000
Total Fixed Cests $ 770,000
Total Annual Cests oo. $1,897,000
Cost/lb smingted..cil Brese Sueen ete $ 0632

Cest/gal. contaminated oil ‘-....~2-- $ 31

(1) This includes replacement of 43,000 Lb/yr. of scent activated carben ard
incineration of the spent material by a general curpese chemical waste
incineraticn.

-44—



copper used in the reaction apparently catalyzes the dehydroculorination of the
trichlorcbenzene (TCB) solvent used in the process to form varying amounts of
trichloro and pentachlaro bishenyl résidue in the product. Further chlorinaticn
of phthalo blue to make rhthalo green pigment results in the formation of PCBs
residues in the green product. Domestic and foreign manufacturers of phthalo
pigments, using the TCB solvent precess, have tested these picments for PC3s
level. Results indicate that this process consistently produces pigments with
PCSs residues in the 100-300 ppm range. me analysis from a domestic manufacturer
reported concentrations as high as 1000-2000 ppm. Several U.S. companies manu-
facture the phthalo pigments from the basic raw materials, while the other U.S. « ;
companies marketing these pigments import foreign TCB-based crude pigments and. |
purity them for sale in the United States. Under the proposed FCB ban regulations,
all of these manufacturers are in effect producing a PCB mixture which could sot
be sold or distributed in commerce effective 30 days after sramlgation of the ©
draft regulaticns. : a

Discussions with the damestic shthalo pigment manufacturers
have disclosed that aly one menufacrurer dees not use the TC3 solvent precess
(xarosene is used as the solvent in a proprietary process and the pigment pro-
larced has essentially zero PCSs). ALL other demestic ad foreign manufacturers
use TCS solvent, and are accordingly faced with major process revisions to comply
with the proposed 50 ppm PCBs Limit in their product. .

The concentration of PCBs in the phthalocyanine blue and sreen ©
pigments can reportedly be reduced to below 50 ppm by a chance in. the solvent ~
used in the manufacturing process. Such a change will require modifications of
the process and quality control procedures, and may cost $100,000 for each of the
five or so manufacturers and inperters of the material. Since uncontaminated
pigment is available from one U.S. mamifacturer, there is sufficient price cam
petiticn to prevent these increased costs from being passed along in higher
product prices. ‘The effect would therefore be a decrease in corporate profits.



invencories. The Limited mmber of PC3 items still in inventory could not -
easily be identified, and the practical difficulty of enforcement. would
limit the real impact of the regulation. Should any special situaticns...
result in large mmbers “of new PCR appliances in wholesaler's or retailer's
inventories on June 30, 1979, the cwners of of the units could apply to the EPA
for a temporary exemption from the provision of the ban regulations similar
to that which is discussed in the preamble to the proposed regulation for the
continued use of FCB capacitors in the repair of electrical equinment.

3.2 Summary .

The only impacts of the proposed bans on ‘distribution in camerce’
may be the obsolescence of certain retailer inventories of PC3 appliances.
Options available to such impacted parties include the replacement of FCB
capacitors with non-PCB units, ar the application to the EPA for an excep-
tion to the ban regulation. Total costs are unlikely to exceed a few hundred
dollars per affected establishment, and would “likely total Iess than‘ona ~~
million dollars. The practical difficulty in enforcing this part of the
regulation will probably result in real impacts considerably lower than these
estimated amounts.

-1g-



2.0 METEODOLOGY FOR ECONOMIC -W@PACT ANALYSIS OF THE PROPOSED "PCB. BAN
" -‘REGULATIONS"

2.1 General Aporodch

The approach used in developing the econamic impact analysis of

the proposed "PC3 Ban Regulations” is summarized belew:

(1)

(2)

(3)

(4)

Each industry significantly affected by the draft regulaticns is
considered separately. The analytical methodology used is the
same for each industry, and the results are oresented in a format
pemitting aggregation. oe
analysis is Limited ta impacts expected to result from the
proposed ban regulations. The impacts are the incremental changes -
from a base condition assumed to be the industry practices in 1975
as modizied by the FCS effluent standaris, ard the FCB Disposal ard
Marking regulations. : _

Increaséd industry costs due to the use of substitutes for PCs

and the resulting product development costs or the costs of dis+
continuing certain products are the basis of the calculation of ~
cost impacts. The resulting price and product quality effects are
used to calculate expected changes in demand and market shifts
among competing products. The impact of these market effects on.
individual industries is used to calculate employment changes.

Each industry is regarded as a link in an input-output chain or

web. Thus, changes in output affect customer industries and,
analysis is extended only to the first tier custamers, and second-

-1L4e



has been a function of the fire hazard which would result from the failure of
type of capacitor. Secmentaticn of this industry by type of capacitor is
| to calculate the impacts of the draft regulations.

PCB capacitors have been made in many different sizes and in designs
suitable for many different voltages and applications. For the purpose of this
analysis, all of the various types of PCB capacitors will be classified as
either power factor capacitors or industrial capacitors. Power factor capacitors
are those large high voltage umits used by utilities to correct for lagging
power factor in electric transmission and distribution systems. Industrial
capacitors include all other types of CB units which are used in association
with specific types of equipment such as electric motors, fluorescent Light
ballasts, and electronic circuitry.

Census figures for capacitors are collected by the U.S. Department
of Commerce on the basis of seven digit SIC codes. “The tiost recent data at this
level of disaggregation was obtained in 1972 and is summarized in Table.15.2-1.
below. More information at this level will be cbtained in 1978, but will net be
available for several years.

Table 15.2-L
2CB Capacitor Production and sales: 1972")

Type Production-Units Sales-Million $
Shunt and Series Power Factor Correction 192,700 41.1
General Purpose Motor Control : 22,100,000 39
Fluorescent Light Ballast Capacitors _ mot available 32.3

and other capacitors except electronic

(lL) Seurce: U.S. Department of Commerce, Electrical Measurement and Distrihu-
tion Equipment, Publication MC(2-36A).

-97—


6.0 RAILROAD LOCOMOTIVE TRANSFORMERS

the railroads -in the northeastam thited States from Washington,
D. C. to New York and nearby areas are electrified. ‘he power t the loc
motives and self-powered cars is carried to the equipment through high vol-
tage ac catenaries, Transformers on the lccomtives and cars reduce the
voltage to that required by the tracticn motors. It has been standard prac-
tice to use askarel (PC3 based) liquid in these transformers due tn: the
risks ‘hat would result from spills of flammable Liquid follaring an acci-
dent in a tumel.

The transformers in the railroad lecomotives and transit cars are
known to be a maintenance orcbhlem because of the design limitaticns.impesed . -
by space requirements and because of the severe sheck, vibration, .and
mechanical impacts encountered in service. Leakage of PC3s is not an umusual
occurrence, and control ‘and disposal of this leakage is impossible as it is~
usually sprayed on a well-drained road bed. Therefore, the railroad trans-
formers present a significantly more severe risk of less of PCBs to the
envirerment than do stationary transformers.

6.1 Requirements of the Propesed Regulaticns ©

The proposed PC3 ban regulaticns will allow continued use and
maintenance of railroad locomotive and car transformers for five years, but
with the following limitations:

l. Each omer of a PCB railroad transformer must report the

liquid volume of each transformer to the EPA within 90
days after the effective date of the regulation.

2. Each person who-uses..a. PCB railrdad transformer mist de~..
velop and implement a formal spill preventicn and. control
plan.

3. The concentration of PCRs in the dielectric liquid in
PCB railroad transformers. mist be reduced to below four

-26- —



tt of replacing these ‘capacitors includes cut of service time and high
‘costs, and may total ten times the retail price of the replacement.
capacitor. The cost of replacing failed capacitors may therefore be
equal to 20 percent of annual industrial capacitor sales. I£ shortened
service life results in an increase of the rate of failure to 5 percent of
the non-fCB units prior to obsolescence, the increased replacement costs
could be 50 percent of the value of the total small capacitor market.

-107-


18 USC 26058.

EE

SEC. & REGULATION OF HAZARDOUS CHEMICAL SUBSTANCES .AND
MIXTURES. -

(a) Scorz op Reoctation.—If the Administrator finds that there is

a reasonable basis to conclude that the manufacture, processing, dis-

tribution in’ commerce. use, or disposal of a chemical substance or

. Mixture, or that any combination of such activities, presents. or -wiil |

present an unreasonable risk of injury to health or the environment,
the Administrator shall by rule apply one or more of the following
requirements to such substance or mixture to the extent necessary to
Protect adequately against such risk using the least burdensome
requirements: . .

(1) A requirement (A) prohibiting the manufacturing, process-
ing, or distribution in commerce of such substance or mixture, or
(B) limiting the amount of such substance or mixture which may
be manufactured. processed, or distributed in commerce.

(2) A requirement—

(A) prohibiting the manufacture. processing, or distribu-
tion in commerce of such substance or mixture for (i) 2
particular use or (ii) a-particular use in a concentration in
excess of a level specified by the Administrator in the rule
imposing the requirement, or

B) limiting the amount of such substance or mixture
which may be manufactured. processed. or distributed in
commerce for (i) a particular use or (ii) a particular use
“in.a concentration in excess of a level specified by: the
Administrator in the rule imposing the requirement.

(3) A requirement that such substance or mixture or ‘any
article containing such substance or mixture be marked with or
accompanied ‘by clear and adequate warnings and instructions
with respect to its use, distribution in commerce, or disposal or
with respect to any combination of such activities. The form and
content of such warnings and instructions shail be prescribed by
the Administrator. .

(4) A requirement that manufacturers and processors of such
substance or mixture make and retain records of the processes
used. to manufacture or process such substance or mixture and
monitor or conduct tests which are reasonable and necessary to
assure compliance with the requirements of any rule applicable
under this subsection. .

(3) A requirement prohibiting or otherwise regulating any
manner or method of commercial use of such substance or

mixture. :
(8)(A) A requirement prohibiting or otherwise regulating any
manner or method of disposal of such substance or mixture, or
of any article containing such substance or mixture, by its manu-
facturer or processor or by any other person who uses, or disposes
of, it for commercial purposes. .
(B) A requirement under-subparagraph (A) may not require

any person to take any action which would be in violation of
any law or requirement of, or in effect for, a State or political
subdivision, and shall require each person subject to it to notify
each State and political subdivision in which a required disposal
may occur of such disposal. a
- (7) A requirement directing manufacturers or processors of
such substance or mixture (.A) to give notice of such unreasonable
tisk of injury to distributors in commerce of such substance or
mixture and, to the extent reasonably ascertainable, to other per-
sons in possession of such substance or mixture or exposed to such
substance or mixture, (B) to give public notice of such risk of
injury, and (C) to replace or repurchase such substance or
mixture as elected by the person to which the requirement is
directed.

Any requirement (or combination of requirements) imposed under

this subsection may be limited in application to specified geographic

areas.

Ae}



years of labor.. At a demand rate of 3.4% during the first
year, this implies an increased emrleoyment of 69 to LO
jos in the disposal industry in 1979.



capacitor is required to provide the same electrical function. As a result of
the size increase, same manufacturers who use capacitors in their products will
have to redesign to allow room for the larger capacitors. Capacitors using
metallized plastic film and phthalic acid ester liquid dielectrics are being
tested; if successful, such units would be the same size as equivalent PCB
capacitors.

The phthalates are more flammable than PC3s, and satisfactory
fire safety can be achieved only by incorporation of adequate circuit breakers
(pressure or thermal types) which will prevent rupture of the capacitor case
follewing electrical failure of the capacitor. Substantial testing has been
required to prove the adequacy of these circuit breaker devices to the satis-
faction of the users of the capacitors because of the possibility of sub-
stantial product liability claims should a fire problem develop with the non- .
PcB units. ‘The development and testing requirements have delayed the intro-
duction of the non-PCB capacitors. However, none of the manufacturers of
small capacitors contacted anticipate using PCBs after mid 1978. Use of Pas
until then will be based on existing inventories, as Monsanto stopped shizping
PCBs in Cctober, 1977, and no importation of PCBs is planned by any capacitor
manufacturer.

The switch to phthalic acid esters will increase the demand for ~
this class of chemical by approximately twenty million lb/year, compared to
a total production of about one billion lb/year. This two percent increase in
demand will not significantly affect either the availability or price of this
material.

Estimation of the unit cost impacts of the FCB ban regulations on
the industrial capacitor segment of the market is difficult for several reasons.
First, Monsanto significantly increased the price of PCBs during 1976 and 1977.
These price increases reflected greater production costs due to environmental
percautions in handling and shipping the material, olus costs incurred through
Monsanto participation in the regulatory process. Monsanto was also in the

-104-



iten . Material Cost_.
‘ (§/gal of replaced fluid)
Solvert =~ . $. 2.26
New Hydraulic Fluid 7.57
Disposal 0.37
Total $ 9.40

Chevrolet estimated that it would cost $500,000 t> replace the nyéraulic fluid

in the 25 systems (29,000 gal total capacity) in their Bay City (Mich.) plant.
: Representatives of two companies stated that if they were forced

to use hexane or scme similar solvent they would be severly affected as the

ql)

seals in their machines would have to be replaced. Also, there was.concern . -

among those who nave already flushed their machines that further flushing
would not significantly lewer the PC3 level in their machines.

ALL of the available industry cost estimates are summarized in
Table 10.3-2.
Table 10.3-2

Industry Estimates of the Cost of Draining, Flushing, and
Refilling Die Casting Machine Hydraulic Svstems

No. of No. of Total Cost .
Company, Mechines Galions $ $/Gallon S$/Machine

Chevrolet 25 29,000 500,000 17.24 20,000
General Motors ; 9.40*
Outboard Marine 130 65,000 840,000 12.92 6,500

* Material cost only.

(1) Michigan Department of Natural Rescurces, File Memo, undated.

-68-



price for an askarel transformer (see Chapter 16), and that rebuilding would
cost 70% of the cost of the new transformer if allowed, () then the foregone
savings from banning rebuilding of askarel transformers would be 30% of the
cost of the mits. Baséd on an average Gost of $20,000 per transformer, fore-
gone savings will be $6,000 per askarel transformer.

Total foregone savings will depend on’ the proporticn’ of askarel
transformers which are scrapped because of non-repairable failures or cbso-
lescence rather than because of repairable failures. An active market in used
askarel transformers existed in the past, but this market has become much less
active over the sist year because the provisions of the water pollution control
regulations and the OSHA regulations on worker exposure to PCBS-have increased |
the risk of using askarel transformers. No data is available on the proporticn
of askarel transformers that are removed from service prior to failure, and -
even if historical data were available it could be misleading because mst
askarel transformers have not. been in service long enough for. aging of the
insulation to increase the risk of failure ofthe mits. It is Likety,-basad © -
on Versar's estimates rather than on hard data, that Gne-third to two-thirds
ef the existing askarel transformers will be retired due to obsolescence orior
to failure. ‘The total foregone savings would therefore be $6,000 per mit x
V/3 to 2/3 of the 140,000 units in service, or a total of $280 million to -
$560 million. _°

Timing of these faregcne savings will depend on the rate at which

~~~ <“"“askarél tiansicirs fail] Present failiire tates are low becatise of the
relatively young ace of most existing units. A previous EPA sponsored

study(?) estimated that aparoximately 80,000 gallons of PCBs were used in

(1) Based on a consensus of industry estimates obtained by Versar during a
telephone survey of transformer manufacturers and rebuilders.
(2) Versar Inc., PC3s_in the United States: Industrial Use and Environmental
eee Springfield, VA: National Technical Information Service,
IIS PB 252 402/3WP), February, 1976. p. 114.

-20- —



for use as supplemental fuel in a steam boiler of a paper mill. The oil had
been collected primarily from automobile service stations, although it is
pessible that same industrial oil, including hydraulic oil, had been included
in some of the lots. FC3s were found in the samples of oil at concentrations
ranging from 3.2 ppm to 19.4 poem. Although these oil samples were collected
from a restricted area, the extent of PC3 contamination is probably repre-
sentative of waste oil collected throughout the United States.

The PCB contamination of the waste oil could came from contaminated
industrial hydraulic oil or transformer oil or from PCB additives used in
lubricating oils prior to 1973. In applications such as railroad car journal
box oils, PCBs may have been used as lubricant additives. @) PCBs may also
have been added to automobile transmission fluids to control the swelling of
oil seals.

It would not be expected that PCBs would be destroyed during re-
refining of waste oils. PC3s were reported to‘ be present in concentrations”
of several parts per million in reclaimed oil used to lubricate whetstones. (2)

13.3 Compliance Costs

Collection of any waste oil likely to be contaminated with PC3s
for a controlled use would not be attractive financially unless the oil were.
known to contain PCBs at levels belew the control amount. Analytical costs
for determining low levels of PCBs will be considerably higher than the
costs quoted for transformer oil because naturally occurring sulfur and
chlorine compounds in petroleum oils cause interferences in the use of electron
capture gas chromatography at concentrations of 5 poem PCBs or belew. (3) These

(1) Monsanto Chemical Company, Aroclors for ——-, St. Louis, Mo.: undated.

(2) Weens, George, (United States Department Of Interior, Denver, Colorado),
"Polychlorinated Biphenyls", File HLS 3-3-10h, June 13, 1977.

(3) Hofstader, R.A. (Eaon Research and Engineering Co.); Lisk, D.J., Bache, .
C.A. (Cornell University), “Interference in the Electron-Capture Technique
for Determination of Polychlorinated Biphenyls by Sulfur-Containing Com
pounds in Petroleum Products", Bulletin of Envirommen: steal Contamination and
Toxicoloay, Vol. 11, No. 2, 1974.

-86~



1.0 INTRODUCTICN

1.1 Purpose and Scone

The purpose of this study was to evaluate the economic impacts”
of the proposed "PCB Ban Regulations.” These regulaticns were prepared
by the Office of Texdc Substances of the U. S. Envirermental Protection
Agency with the technical support of the Interagency PC3 Work Group. ‘hese
regulaticns implement the bans on various PCS activities which were estab-
lished by Congress in Section 6(e) of the Toxic Substances Control Act -
Public Law 94469 (see Appendix A).

The ecenamic costs reported herein are those directly and in-

directly attributable to these changes in: future PCB activities which would

be caused by implementation of the proposed regulaticns. From the wording . :
of Section 6(e}, it is clear that the intent Of Contress was to ban the TM —
mamuifacture of FCBs after December 31, 1978, and to ‘ban the distribution of
polychlorinated biphenyls (Pcas) after Jtme 30, 1979, ‘Therefore, the long

term costs of using substitutes-for PeBs will be-a- consequence of tis -— 0
legislated ban on the mmnufacture of PCs and not a consequence of dis- ~~
cretionary regulatory actions taken by the Enviromental Protection Agency.

The effect of the authorizations in Section 761.31 of the pro- _

which could have resulted from the immediate application af the. bans.set.. ...
.-forth.in_the act_ta PCB_equinment and articles. The costs which wera es=.._

~, timated as—resulting-Srom theseauthorizations were the incremental-costs =~
- based. on_the_pre-1977_base,_and not.the changes _frem the higher. costs _._..
which would result in the absence of these authorizations. Hcwever, the
assumptions behind the analysis of the individually identified impacts are
explicitly identified, and the aalysis should strport the evaluation of
alternative regulatory approaches.



The industry cost estimates are roughly comparable to the cost
estimate made by Versar and presented in Table 10.3-3. .Since the Versar__
estimates do not include inventory costs “or the cost of decontaminating the
waste liquid truck, a figure of $14 per gallon might be a more realistic
estimate of the average price of decontaminating hydraulic systems. .

The effectiveness of the decontamination procedure will depend cn
hew thoroughly the system can be drained of both the contaminated Licuid and
the flushing liquid and also on the amount of PC3s which are absorbed into
gaskets amd other porous material. Assuming that the draining and flushing
procedure will remove 80% of the total PC3s, a system originally contaminated
with PC3s at 1000 pom will still be contaminated with 200 com six months
after the first flushing, but the level of PC3s after the second flushing will
never exceed 40 pom. Since there will probably Se considerable leakage and
topping off between the Slushings, the concentration of PCs is likely to be

even lewer than these calculaticns indicate. * tes

Assuming that each of the 1000 presently contaminated systems mist
be flushed end refilled twice, and that chemical analysis for 98s is reqiired
six months after each flushing, the total costs involved will ce:

First flushing 500 gal. @ $14/gal $7,000 - .
Chemical analysis 300
Second flushing 7,000
Chemical analysis 300
Total per machine : $14,600
Total for 1000 machines $14,600,000
+--+ +--+ A. major—facter—in—ske-cost-ef-deeontaminating- hyératiiic-systems- ts
_ the cost of the uncontaminated-fluid sedi refill the systems -:Tt is umdera. in nne.

.. Stood that Doth-Outheard Marine-and-Ceneral- Motors have -conéucted tests of —
methods to remove PCSs from hydraulic fluids. It is not known whether these
methods involve distillation or adsorption. The feasibility of such pro-
cessing may have a substantial effect on the costs of decontaminating hycraulic
systems and on those companies which reclaim hydraulic fluid.

~69-



11.0 HEAT TRANSFER SYSTEMS

PCBs have been extensively used as heat transfer liquids. because of.
their excellent thermal stability and inherent fire safety. Although the
heat transfer systems are usually quite tight, leakage can cccur due to
mechanical damage of the system or because fittings have loosened as a result
ef thermal cycling. The Yusho incident in Japan in 1963 caused the PCB
poisoning of 1001 people due to the leakage of PC3s from a heat transfer
system into rice oil that was being heated by the systen. ©)

A previous EPA sponsored study estimated that total usage of PCBs in
heat transfer systems in the United States has been over 21 million pounds. ')
Most of this material was manufactured by Monsanto and distributed under the
trade name Therminol. Monsanto stopped producing PCB hesed heat transfer
liquid in 1971 and advised its customers to drain and flush their systems
before replacing the fluid with a non-PCB based liquid. An acditional-one
million pounds of PCB heat transzer Liquid was manufactured during the period
1971-1973 by Geneva Industries of Houston, Texas. (9) there was at least one
company still using PCB based heat transfer licuid as late as 1976. (4

ll.1 Requirements of the Procosed Regulations

As of the effective date of the regulation, heat transfer systems
containing a liguid contaminated with more than 50 pom PBs could rot be used until
the concentration of 8C38s is reduced to less than 50 pon.

TI) Kuratstne, Masanori, et. al., "Yusho, a poisoning caused by rice oil con-
taminated with polychlorinated biphenyls", RHSMHA Health Reports, Vol. 36,
No. 12 (December, 1971), pp. 1083-1091.

(2) Versar Ine., Usage of PCBs in Oven and Semi-closed Svstems and the
Resulting Losses or PCBs to the Environment, Unpublished Drart Report,
(EPA Contract No. 68-01-3259, Versar Report No. 474-5C), September 30,
1976, p. 13.

(3) Tbid.

(4) Ibid, p. 26.

-75-



 TARIE CF CONTENTS (Cont'd)

15.0 CAPACITOR MANUFACTURING 6... ee ee ee 96
15.1 Requirements of the Proposed Regulations. ... 96
15.2 Capacitor Production, and Sales... ...... 97
15.3 Compliance Costs 2... eee ee ee 8 ;
15.4 Summary ee ee ee es 108

16.0. TRANSFORMER MANUFACTURING ... 2.62222 ee ee ~ 109
16.1 Requirements of the Proposed Regulations. . . . 109
16.2 Industry Structure, Production, and Sales . . . 109°
16.3 Substitutes for PCB Transfomers: ...-. . . 101

_ 16.4 “Relative Prices of Non-PCB Transformers... . 116 _-
16.5 Compliance Costs 2.1... cee eee ee LY

16.6 Summary. ww ee ee ee ee ew ee LB

17.0 ‘TOTAL COST AND ECONOMIC IMPACTS... 2. ee ees - 120
17,1 Transitional Cost Impacts... ....-2-5.-120 -
17.2 Lomg Term Cost Impacts . 1.1 6 ee eee ee
17.3. Employment Imacts 2... 2... ee ee ee we
17.4 Other Econemic Imacts . 1... 0 ee eee ee 124

BE

APPENDIX A - TOXIC SUBSTANCES CONTROL ACT
REFERENCES



Table 15.3-3

Manufacturers of Small Liquid Dielectric ac Capacitors .

Company

—_

General Electric
Agrovox

Universal Mfg.
P. R. Mallory

Comell Dubilier
Jard Corporaticn

Electric Utility Co.

Others

Small Capacitor

Sales (1975)* . ae
Million $/year » Status of PC3 Use as of Late 1977
30 No PC8s used
24. PCBs inventory sufficient wmtil
June 1978 .
13 Will end PCB use by mid 1978
10 PCBs inventory sufficient through
March 1978
‘No information available
Will end use of PCBs ‘during first
quarter, 1978 .
+3 PC3s inventory sufficient through .
mid 1978
3

No use of PC3s after 1977

Source: Office of Environmental Affairs, U.S. Dept. of Commerce

~103-



spill prevention and control plan. Because of the complexity of the machines
and the assumed requirement for periodic Zlushing and decontamination, the
plan will be rather complex and may require the services of a registered pto~
fessional engineer for one week at $250 per day. Preparation of these plans
by all 585 affected companies could cost a total of (585 plans x § days x

$250 per day = $730,000). ‘This cost could be reduced by perhaps one half
if a pro forma plan were developed under the sponsorship of a trade association
or major manufacturer and made available to all affected fims.

Total expected cost of this part of the regulations would therefore '
be expected to be $365,000 to $730,000. :

10.4 Summary
Identification of Contaminated Die Casting Machines
Analysis and Sampling $ 750,000 .
Clerical - Report to EPA * 220,000 °
Spill Preventicn and Control Plans $365,000 to $730,000
Decontamination of Die Casting Machines 14,600,000
Decontamination of Other Hydraulic . 3,650,000
Systems
Cost of Production Interruptions when ? (potentially .
other bydraulic Systems Remcved from large)

‘Total $19,720,000

Emoloymens Effects

Labor equals (.48/12.50 = 3.8%) -of per gallon cost. Total labor
cost = (.038 x 18,250,000 = $693,000). At $30,000 per man year, this is equal
to 23.1 man years of labor, or 12 jobs for 2 years. Spill prevention plans
would require 5 man years of effort. Reporting requirements would require an
additional 7 man years.

“7



result in substantial retooling, research and development, and other production-_
ated costs. Such costs are normally high at first, since the industry is

issentially characterized as infant; i.e., it is facing a new learning curve
due to the production of technologically new capacitors. However, since all
manufacturers are developing non-PCB capacitors, and since these new products
will be introduced essentially simultaneously, there will be substantial cam
petition which will prevent the rapid recovery of development ard tcoling costs
through market skinming. Therefore, it is expected that the initial product
prices will closely approximate the long term competitive price structure of
the capacitor industry. A review of the present status of each of the major
segments of the capacitor industry should provide an accurate picture of the
response of this industry to the FCB ban regulations.

Power Factor Cavacttors

Large power factor correction capacitors which operate at voltages
above 2000 volts are used by electric utilities to compensate for inductive-.
current lags caused by inductive motors and other similar machinery. ‘These
capacitors are usually mounted out of doors in substations or on power coles,

little risk of siqificant fire lesses is incurred by the use of a
flammable dielectric licuid in these units.

Prior to 1977, there were four manufacturers of PCB power factor
capacitors. All four of these manufacturers discontinued the use of FCSs during
1977 and introduced non-PCB capacitors having the same functional specifica~
tions as replacerent products. Table 15.3-1 lists the manufacturers of
these large capacitors and summarizes the technology used in the new products
introduced by each manufacturer. The selling prices of these large capac
itors are negotiated on the basis of large orders, and no published price
lists are available. However, Versar estimates that the prices of the capac-
itors manufactured by Westinghouse, General Electric, and Sangamo increased
10% to 15% following the introducticn of nom-PCB units, and the price of the
MeGraw Edison capacitors increased 153 to 20%. McGraw Edison claims exceptional
product life and efficiency for their product, and the higher price has
apparently not had a significant impact on their snare of the market.

<99-


13.1 Requirements of the Proposed Regulations

: The disposal of oil contaminated with 2C@s in excess of 500 pam is
regulated by the 'PCB Marking and Disposal Regulations'. The proposed 'Pcs
Ban Regulations' would change the definition of 'PCS3 Mixture’ used in the
Marking and Disposal Regulations to include all mixtures containing mre +t
50 ppm PCBs. This will affect the allowable uses and disposal of oil con-
taminated with lower concentrations of PCBs.

Under the provisions of the proposed ban regulations, oil con-
taminated with PCBs in excess of 50 prm would have to be identified, segregated
for purposes of disposal, and burned in an approved chemical waste incinerator. 1
Oil containing measurable amounts of PCBs less than 50 pom could be processed
for any use including as fuel or reclaimed lubricating or hydraulic oil, but
could not be used as road: Lor as a constituent of any sealant, coating,
or dust control agent. vee : . :

13.2 Sources and Amoun Contaminated Waste Oil tee

Rydrautie Flutds Oil is used as a lew viscosity fluid in hydraulic
systems, and FCB based hydraulic fluids were widely used prior to 1972. The
Most expensive (and polluting) use was in die casting machinery. FCB based
hydraulic fluids were also used in construction machinery, fam machinery
(a source of feed contamination) 1) and in deep mining equigmént where the
use of PC3s resulted in greater fire safety.

Although hydraulic systems are nominally air-tight, leaks may
occur at dynamic seals and major spills may occur due to hese rupture. Normal
leakage is collected in drip pans. The rupture of a hose can spray hydraulic
fluid over a large area due to high operating pressures. It has been esti-
mated that 80% of phosphate ester hydraulic fluid losses occur due to leakages
in the hydraulic systen. (2) in certain industries, operators state that it
is more efficient to continually add hydraulic fluids to the system rather
than shut the system down, repair any leaks, and refill the system. Leakage
from these systems is often collected and reclaimed.

(I) U-S. Department of Agriculture Ad Hoc Group on PCBs. Agriculture's Res-
ponsibility Concerning Polychlorinated Biphenyls (PCBs) Washington, D.C.
Office of Science and Ecucation, U.S. Department or Agriculture, 1972.

(2) Lapp, T.W. (Midwest Research Institute), The Manufacture and Use of Selected

Aryl and Alkyl Aryl Phoschate Esters, EPA 560/€-76-008, Feo. 1976, p. 17.

-84—



‘able 8.2-1

Production Statistics & Present Use Status of PCB-Cooled
Mining Machines

tuber of
Nuder of taker of PER-Cooled
Production Nunber of ness Sta) Liquid-Qooled Motors Stihl Naber of Gallons
Machine Dates Machines Duilt Motors Pec Miching tn Service of NCD Used Per Motor
. ~ _ —— T
Contimwus Miner 1961-1966 uw 3 a 1 4 .
Model Cu43
Continous Miner 1967-1970 ST ~ 15 a ~ a5 5
Malel 904
fy Loaler 1971-1973 su ~$a) 2 .
ne HU . .
S Madel 141 652 4
Spare Motors for 1971-1973, 4 notors -
Model 1410 ‘
,
»
1
!
_ ——



gallons of oil. This criteria may result in the testing of perhars 20% of
all transfommers containing 50% of ail of the oil. the calculation of tie
resulting analytical and disposal costs are summarized in Table 7.34:

Testing and Disposal Costs for Transformer Oil

Assume: 59% of all transformers con-
tain more than 50 opm FCBs. : : 1

Size of Transformer

>270 gal. 7 < 270, dale
Number of transformers 1,000,000: = 4,000,000
Analytical Costs @ $75 $75 million Oo.
Oil in transfomers © 3.25 billion lb. ~ $.25 billion lb.
Oil requiring incineration 3.1 billion ib. §.25 billion lb.
Incineraticn cost @ $.0832 $257 milticn $437 million

Total malytical and incineration costs: $769 million - ee

By comparison, arbitrarily incinerating all 10.5 billion pounds of
possibly centaminated transformr oil would cost $880 million. Assuming
that no additional contamination of transformer oil by PCBs will ccour, re-
placenent of the oil in any contaminated oil filled transfomer would be
expected to reduce the concentration of.residual -BGBs..to- wall.under-50~spms.-9 -
The rate at which these disposal costs will be incurred depends cn
the rate of disposal of contaminated transformer.oil...The regulations do
mot prohibit the processing of- contaminated oil so long as it is returned to
the same transformer it was taken fom. Processing losses are exrected to
be low, so mest of the centaminated oil would not be disposed of until the

od Q—



and storage areas. The regulations also require that disposal of PCB
liquids, materials and equipment by by approved methods (generally hich
temperature incineration-or chemical waste landfill) and establish’ approval
criteria for the disposal facilities. ,

The Taxic Substances Control Act also established cutoff dates
for certain PCB activities as follows:
January 1, 1978: All manufacturing precessing, distribution
and use must be in a totally enclesec manner.

January 1, 1979: -No further mamufacturing or importing of
PCRs allowed.

July 1, 1979: No further orocessing or distribution in cor
merce of PC8s allowed. .

The proposed ee] Ban Regulations implement these requizements
of the Act and also authorize the centinuaticn of specific activities
where the EPA has determined that such activities will not present an... ,
unreasonable risk of injury to health or the enviroment.

1.4 ‘Summary of Precosed Ban Requlations

_ fhe continued manufacturing, processing, distribution in ecimerce, |
and use of PCEs has been regulated by Congress. Section 6(e) of the Toxic.
Substances Contzol Act (Public L. 94-469, 90 STAT 2025), established
various restrictions on PCB activities and the dates on which these re-
strictions become effective. EPA is required by Section 6(e) to establish
by rule several technical findings regarding PCS activities. ‘hese find
ings must establish:

(1) The level of exposure of human beings and the enviren-
ment to PCBs that may be considered insignificant
[Secticn 6fe) (2) (C}]. This level of exposure is the
basis for judging whether any activity or use is in
"a totally enclosed manner.”



TT

These data suggest that the sales of transformer oil have increased
geometrically at a rate of 5.4% per year (average increase) from 1968. throuch
1974. Assuming that this growth rate deScribes oil sales prior to 1968,
total oil sales through 1974 would have been 1.8 billion gallons, or a total
sale of two billion gallons up the present. Since few transformers have
ever been scrapped and since transformer oil has been routinely reclaimed for ©
reuse, the total amount of oil in service is orebably about 90% cf the total
amount produced, ar 1.8 billion gallns.

Assuming that the pole mounted trensfommers require an average of
16 gallms of oil per mit, the 1972 transformer production required 20
million gallons of oil for the pole mounted transformers and 60 to 62 millicn
gallons (depending on the amount of oil used in transdommer maintenance) ‘to. -
fill the remaining 245,000 oil filled transformers.‘ This gives an averace oil -
capacity for non=cole mounted transformers of 250 gallons’ ner wit which is
not significantly different than the 300 gallons per asktel transformer’ used
in previcus calculations. ‘the thirty million pole minted transformers con-
tain about 500 million gallons of oil at 16 gallons per mit. The remaining
1.3 billion gallons of oil-would fi11 5;20600¢—trensSomerstaving “ar average *
capacity of 250 gallons. Since improved transformer designs have reduced the ~~ —
quantity of oil required per transformer over the years, this figure perhaps -
overstates the number of transfomters in service, but. an estimate of 5,000,000.

__Qunershio of Transformers

; _Most of the power and substation transformers are owned and maine... -

tained. by utilities. The cwmershin-ofthe.smals-power «trans fommexs-andathe-<-n i

” pad mounted distribution transformers depends on the policies of individual

"“WHiities, and ‘there &é3 "not appear to be any standard policy that applies
across the comtry. Almst all the larce distribution transformers are

owned by utilities; those owned by industrial plants and larce buildings are

-39-



——<—<—<— eee

“appre 753-1

Preliminary Cost Estimate fer a Chemical Weste Incirerater for
Transformer Gil Conteminated with Lew Concentrations of PC3s

Plant. Capacity: 4,000 lb oil far. (800 gal/nr.)
Soutoment

Canbusticn fomance, after bumer,

Sexubbing Equimment, Tankece, Pumps

Stack, Foundaticns, Site and Site ed
Preparation

Activated Carbon Filtraticn

Settling Fond

Subtotal
Piping and Valves @ 253

Subtotal
Engineering ¢ 7% ;

Subtotal
Contingency @ 20% , ,

: . Total;
-~43-

Installed Cost

$ 1,000,000 ©
* 00,000

“150,000

250,000

100,000 -
$ 2,000,000

$00,000
$ 2,500,000

175,000
$ 2,675,000

535,000 --- 2-2 een -

se

" 's 3,210,000



Revorting Requirements

The proposed regulations would require that owners of ‘dle casting
machines having hydraulic systems coritaminated with over 50 pom 23s report:
the identity of each contaminated machine and the concentration of PCBs in
the fluid. This will require the identification of all machines that ever used
C3 fluid and those that may have used PCS-contaminated reclaimed hydraulic
fluid and the chemical analysis of the present fluid in these machines for the
Presence of PC3s. This sampling and analysis procram may cover as many as
2500 machines and must be completed within 90 days of the effective date of
the regulation.

Chemical analysis for the quantification of PCBs in hydraulic
fluid would be considerably more complex and expensive than that required to
determine the concentration of 2CBs in lO-C transformer oil. This is be- :
cause the presently used hydraulic fluids may be based on’ chemicals such as
Phosphate esters which require that the PC3s be extracted from the sample ..
prior to analysis. ‘The possible presence of PCTs in the fluid could interfere
with the analysis for ?C8s, and discrimination between these similar chemicals
would require the use of a gas chrematograrh/mass spectrometer rather than
the simpler gas chromatograrh usually used for PCB detarminations. Versar .
estimates that the complete analysis of contaminated hydraulic fluid for PCBs
may cost as much as $300 per sample on the average. ,

Review of the records..to determine wich machines. may he come 1...
taminated with PCBs and the preparation of the report to EPA would be expected
to require an average of three days for each of the 585 firms which purchased
PCB hydraulic fluid in 1970 amd 1971. This would result in a net employment

7.3 man years). At.a. burdened. rate.cf.$30,000 pex.man year,.this-would -
result in total reporting costs of (7.3 x $30,000 = $220,000).

Total costs attributable to the reporting requirement would be
($300 per sample x 2500 machines = $750,000) + $220,000 clerical = $970,000.

Sptil Prevention and Control Plans

Each company which uses or services a die casting machine chat is
contaminated with PCBs will be required to develop and implement a formal

-72-



PUBLIC LAW 94-469-—OCT. 11, 1976 90 STAT. 2025

(e) Pourcxnorivaten Birnenyis.—(1) Within six months after Rules.
the effective dace of this Act the Administrator shall promulgate
tules to-—

_(A) prescribe methods for the disposal of polychlorinated
biphenyls, and :

(B) require polychlorinated biphenyls to be marked with clear
and adequate warnings, and instructions with respect co their
processing, distribucion in commerce, use, or disposal or with
Tespect to any combination of such activities.

Requirements prescrided by mues under this puragraph shail be con-
sistent with che requirements of paragraphs (2) and (3).

(2) (A) Except as provided under subparagraph (B), effective one
year after the effective date of this Act no person may manufacture,
process, or distribute in commerce or use any polychlorinated biphenyl
im any manner other than in a totally enclosed manner.

(B) The Administrator muy by cule authorize che manufacture,
processing, distribution in commerce or use (or any combinution of
such activities) of any polycivlorinated biphenyl in a manner other than
ina totally enclosed manner if the Administrator finds that such manu-. oe
facture, processing, distribution in commerce, or use (or combination
of such activities) will noc present an unreasonuble risk of injury to
health or the environment.

(C) For the purposes of this paragraph, the term “totally enclosed “Totally enclosed -
manner” means any manner which will ensure that any exposure of manner.” “0
human beings or the environment to a polychlorinated biphenyl will
be insigniticant as determined by the Administrator by rule.

(3)(A) Except as provided in subparagraphs (B) and (C)—

(i) no person may manufacture any polychlorinated biphenyl
after two years ufter the etfective date of this Act, and

(ii) no person muy: process or distribute in commerce any poly-
chlorinated biphenyl atter two and one-half veurs after such date.

(B) Any person may petition the Administrator for an exemption Petitioa for
from the requirements of subparagraph (A), and the Administrator exempta.
may grant .by rule such an exemption if the Administracor finds
thar—

(i) an unreasonable risk of injury to health oc environment
would not result, an

(ii) good faith etforts have been made to develop a chemical
substance which does not present an unrezsonable risk of injury
to health or the environment and which may be substituted for
such polychlorinated biphenyl.

An exemption granted under this subparagraph shall be subject to Terms and
such terms and conditions as the Administrator may -prescride and coaditioas.
shall be in effect for such period (but not more than one year from _

the date ic is granted) as the Administrator may prescribe.

(C) Subparagraph (A) shall not apply to the distribution in com-
merce of any polychlorinated biphenyl if such polychlorinated
biphenyl was sold tor purposes other than resale before two and one
half years after the date of enactment of this Act. an

(4) Any rule under paragraph (1), (2)(B), or (3)(B) shall be
promulgated in accordance with paragraphs (2), (3), and (4) of sub-
section (c). : .

(3) This subsection does not limit the authority of the Adminis- -:
tracor. under any other provision of this Act or any other Federal law,
to take action respecting any polychlorinated bipheny!.

A-2



1.2.2 Imports of PC@&s

PCEs have been inportsd for use in investment casting ms
wax, for maintenance of certain mining machinery, and as the relant in
electrical transformers. GI

Decachlorobiphenyl was imported fram Italy. for several
years for use as a filler in investment casting wax; this use was ended in
mid-1976. a) Several manufacturers of investment casting wax are presently. :
using imported polychlorinated terpiienyls (cts) in their products. The . j fot
0. S, distixbutor of PCTs has given assurances that PCBs are present cnly
at concentrations Below 0,005 percent, @! gut no data are available on the
actual concentration of PCSs found in these PCTs.

Over 700,000 pounds of PC3s have been imported since 1972 ;
to maintain certain mining machines wiich use PCBs as a motor coolant, 9) ol ese
No additional PCBs will be imported for this use as existing U.S. inven-
tories are reported to be sufficient to meet maintenance requirements for
the remaining service life of the machines.

PCRs have also been imported as components of transformers —
and capacitors. This source of PCBs dees net seem.to be significant at _
present. :

-__ ~£52;3—-Hy drautie Systany Hae TERRES
System, and Compressor Use

PCas have not been commercially available for open system
uses since 1974. Leakage of =C3-hydraulic: fluid was replaced by PCBs taken-—

— fro tendining maintenance supplies and abter these were exhausted, by

(1) Versar Inc. Assessment of the Environmental and Econcmic. imacts of
aqw-cu. the. Ban.on-inperes oreSG8s "Eres L

(2) Perscnal commmication, Mr. L. M. Argueso (M. Argueso and .,
Mamaroneck, N.Y.), August 30, 1977.

(3) Versar Inc. Assessment of the Environmental and Economic Impacts of
the Ban on Imports or - EPA 5 — , July, 1 PD 7, 10.

“Ss ow





Although the average amount of oil per transformer has been calew-
lated to be about 250 gallons, no information is available on the-distributicn
of transfommers by oil capacity. As a reasonable guess, the median teans-
former capacity micht be 150 gallons. A lewer bound estimate of the fracticn
of transfommers contaminated is 323. At this level, testing would be justi-
fied for arproximately one-half of the oil filled transformers other than
pole mounted units. These larger transformers would account for perhaps
75% of the total ofl. Incineration would therefore be the required disposal
method for all of the 253 of the oil in the small transformers ard 45% of |
the rest of the oil. ‘he resulting analytical and disposal costs would then
be calculated as shown in Table 7.3-3, below:

TRELE “73-3

Testing and Disposal Costs for Transformer Oil

Assume: 32% of all transformers con-
tain more than $0 ppm Pas.

Size of Transfommer |;

> 150 cal. < 150 cal.
Nutber of transforrers 2,500 ,000 : 2,500,000
Analytical Costs @ $75 $187.5 millicn 0
Oil in transformers =~" Ss 749 billicn 1b. 2.6 billion lb.
Oil requiring incineration _ 2.5 billion Ib. . 2.6 billicn lb.
Incineration cost @ $.0832 > $210 million $215 million

Tetal analytical and incineration costs: $612.5 millicn

The upper bound estimate of the fraction of transformers that are
contaminated was calculated to be 598. At this level of ccntaminaticn,
testing would be justified only for transformers containing more than 270

a we



PREFACE

11 Purpose and Scope 2 pe eee ee ees
1.2 PCBs Usage in the United States... ..

. 2.2
“1.2.2
1.2.3

1.2.4

1.2.5

_ 1.2.6 ;
1.3 PCB Restrictions in the Toxic. Substances
Control Act 2 2 6 ee ee ee ee ee

1.4
1.5

Effects of the Proposed Regulations

by PCS Use

2.0 METHODOLOGY FOR ECONOMIC IMPACT ANALYSIS

OF TSE PROPOSED "PCB BAN FEGULATICNS" .....

2.1 General Approach . 1... eee ee ewe

2,2 Definition of Econemic Impact .......
3.0 IMPACTS OF BANS ON THE DISTRIBUTION OF

3.1 Effect of the Ban Regulations. .....

3.2 Summary Se ee ee ee

4.0 IMPACTS CN USERS OF ASKAREL TRANSFORMERS...
4.1 Requirements of the Proposed Regulations.
4.2 Compliance sts 2.1.2... 00 0e
4.3 Econamic Impact of Gost Increases ....
4.4 Summary. 2... 0 we eee ew ee

. 10

. lw
» l4
. 16

- il?
17
. 18

B&bb&

wor HW UB NP



10.0 HYDRAULIC SYSTEMS

PCS fluids were used in a large number of hydraulic systems; particu-
larly in die-casting machines and in steel incustry applications where high-
temperature stability and fire resistance were important considerations. in
1972, when PCB hydraulic fluids were no longer available, users were forced
to switch to substitute fluids. Since the substitutes were compatible with
the PCB fluids, the machines were not drained and flushed but were simply
topped off as required with the new fluid. ‘Topping off usually requires
addition of new fluid at the rate of 2 to 10 times the system capacity ser
year to replace leakage losses.

Available data on residual PCB levels in die casting machine hydraulic
systems indicate that many of the tested machines contained PCs in concentra-
tions of 60 orm to as high as 508 ina few cases. ‘The differences in ccn-
centration apparently reflect differences in the rate of leakage from various
machines and differing company maintenance policies regarding pericdic ister be
replacement of hydraulic fluid. .

10.1 Requirements of the Prorosed Regulations

The proposed PC3 ban regulations would archibit the use of fluids
which contain over 50 rom 5C3s in open or semi-closed systems. However,
hydraulic systems on metal die casting machines which contain fluid with more’
than 50 pom PCSs would be allewed to remain in service i= they are drained,
flushed with clean solvent, and refilled with uncontaminated hydraulic fluid.
The fluid mist be re-processed or replaced at intervals of six months to
remove PC3s until the concentration of PCBS remains below 50 pom. In addition,
users of contaminated systems would have to. report such use to EPA and setizicn
annually* fer exemptions ts cantinte using art periedicaily decontaminating the”
equipment.

The provision gor continnet’ use" of these systems is limited to
five years in the proposed regulation. However, it is anticipated that the
required pericdic decontamination of the systems will reduce the concentration
of PC3s to below 50 prem before the provision expires. Hydraulic systems on

~64—



“4.0 IMPACTS ON USERS OF. ASKAREL TRANSFORMERS : , :

Versar estimates that’ there ara about 140,000 askarel transformers in-
use. About 1,000 of these are being usei on railroad locamtives and com
mater cars; the impact of the dragt regulaticns on these railroad lecamtives
is discussed in detail in Chapter 6. Of the remaining units, most are pad

mounted distribution and power transfommers located in buildings and electric ©

generating stations, with a substantial mumber or askarel precipitatar trans-
formers being mounted cn stacks. The distribution of ownership of these
transformers is summarized in Table 4.0-l. With.an estimated average of
2,500 pounds of PCRs in each-transformer, the total in-service inventary of
PC3s in transformers is approximately 300,000,000 pounds. The transformers

are owned afd. maintained by either the utility or the user, depending cn the

business arzahgenents made at thé time of each installation.

4

Table 4.0-1
Estimated Number of PCB Transformers in Service

Category of User Number of Units. PCS Content-Pounds
Utilities . 42,000 105,000,000
Industrial and Comercial 97 ,000 , ~ 491,000,000
Railroad 1,000 ; "4,000,000

_ 140,000 300,000,000

——4-1--Reautirements—of the Proveset Regutations

The proposed ban regulations forbid the major rebuilding of askarel
transformers. Therefore, failed askarel transformers would have to be

=screphaced-srth- susttabbe=norsSca=rerbacemessts eres sare heseehen sheet remanent ae

Increased costs will be incurred at the time of failure of all-140,600 exist-
~..ing.askarel transformers. 0 2

4.2 Compliance Costs

Foregone Savines from Rebutiding

If it is assumed that a replacement transformer of a satiszactory
high fire point liquid cooled design-would cost the same as the historical

19+



are excensive in tems of marrower and lest production campared to the use
of separator magnets, but metal detectors could previde the temporary ore-
tection needed until replacement mcnets were delivered. Detector systems
which are presently in use are not manned continually, so it must te assumed
that the lost production from belt stoppages is less expensive than manning
would be. Assuming that a two-month delay would be experienced in cbtaining
replacement magnets, full tim: (J-shift cperaticn) manning of the detectors
at a burdened labor rate of $30,000 would cost (60 days x 24 hours per day

x $30,000 per man year/1920 man hours per man year = $22,500 ver macret).
Actual labor requirements might reasonably be 10% of this ficure. This labor
requirement would have to be added to the cost of a detector system. All of
these additional costs are very dependent on the timing of the effective
date of the regulation, and would be eliminated if the industry had six
months notice of the intention of the Agency.

9.3 Summary
Cos Impacts:
Replacement cost - 200 electramacnets - $2,080,000 to 2,400,000

Delivery. and installation ests - 200
electromacnets - $208,000 t 480,900

Labor ast increases due to short term lack
of replacement magnets - $0 to $4,500,000 (prcbably
$500,000)
Production and Price Impacts:
Costs ars.expected tobe absorbed by. the ccal miniag..industy
as a reduction in profits.

moloyment Sffects:
No loss of employment at the mines is anticipated. Assuming
that one-third of the manufacturing and installation costs of the replacement
wnits represents. labor at $30,000 per man year, increased labor of

-62-



aimcooled by the end of 1981. ‘The cost of this conversion is $3100 cer _
moter, resulting in a total cost of about $2 million to convert the remain- .
ing 652 motors.

Continuous Minens

The PCB and silicone-ccoled motors in miners present transiticn
problems. As a result of the propesed regulations, the market for used
PCB-cooled continuous miners equipment will virtually disapvear. ‘Therefore,
various mining operations will be confronted with cbsolete equipment verhaps
prematurely, resulting in substantial capital losses which depend won the
remaining useful life of the equipment.

All but one of the nine motors in the Joy. Manufacturing Yodel cv43
continucus miners that are still in service have been converted to silicore
coolants by the owner. “However, it has recently been found that silicone ~ ~~ 7°
vapors may deactivate the eleactredes in methane detectors which are used to
monitor the ambient air conditions in underground mines. Thus, silicore
fluids may not be acceptable where such detectors are used.

Model 91 continuous miners cannct be refitted with air-coled
motors due to space limitaticns, ner can such equisment house converted . : -

_ Motors. Therefore, unless a satisfactory replacement heat transfer lisuic

can be developed for use in motors, this equipment must.be screpred.and new... ©
equipment purchased.

The value of the continuous miners is best approximated by its
value of $40,000 om the used equipment market. ~‘The-new replecement. machines ~
will have a much higher price,” but will be mpre preductive and require less
maintenance. Historically, mining equipment has become cksolete after about
ten vears of service, and most mining erations tend ‘p> weerate their acai ~~
ment oricr to the end of its useful life. Since 1970 wes the last production
Gate of PCB-ccoled continuous miners by Joy Manufacturing Company, all such



(e} Continued use and scheduled phase-out of use of Pc
filled motors used on certain mining equipment.

(@) Continued use of certain hydraulic systems contami-
nated with Fes if efforts are periodically made ¢ =~)
decontaminate the systems,

el Use of waste oils contaminated with PCRs below a con
centration of 50 prem, except as a sealant, coating
or dust control agent. ‘This could ban the use of
oil contaminated with eny measurable amount of PCB
for oiling roads or as a pesticide carrier.

1.5) Effects of the Proposed Reculaticns by PCB Use

The economic impacts resulting from the proposed regulations were
determined by evaluating the effects of the regulaticns cn each identifiable |
PCB use, The report of the analysis also addresses’ each-use in a separate
chapter, and the fommt of the. ferort, therefore, does not parallel the _
format of the regulation, A guide to the discussion of the various sections
of the proposed regulations is presented in Table 1.5-1. ‘he various cost
and econcmic impacts are summarized in Chapter 17. :



which uses silicone as a trensfomer coolant; the tests have not revealed
any problems due to the use of silicone. - See

the Federal Railrcad Adtinistration has Sponsered research by
Westinghouse ©) and General Zlectric'®) t determine the feasibility of re
trofilling existing PCS railroad transformers with silicone. ‘The work per
formed under these contracts included the performance characterization of a
418 KVA transit car transformer which contained 168 gallons of askarel;
draining, flushing, and retrofilling the transformer with silicone; and
characterization of the transformer pertormance when filled with silicone.- !
The tests conducted under these sregrams indicated that draining and flushing .
could reduce the amount of resicual PCB in a transformer to a level low -
enough to assure that the concentration of PCB in the silicone liquid would =~
remain below four percent. ‘he use of silicone as a replacement for PCB re-
sults in a transformer that runs hotter by perhaps five to ten degrees C. .
This increase in temperature will mt necessarily Gecrease the service Life
of a transformer, es the solid insulation used in transformers may degrade
less rapidly in silicone than in PCBs.

PCBs and trichlorcbenzene are selectively acsorbed- Seem silicone» =~. —. _
Licuid by activated carton. Dow Corning recently demmstrated that filtra-
ticn of silicone from a retrofilled-PCB transformer that had been in service
for ten months reduced the concentration of PCBs from 2.53% to 472 parts
-—per-miiiten: (3) (3) som those trenaéommers-equipped with @-pumpy_it-ney- be

(1) Walsh, E.J.; Voytik, D.E.;. Pearce, H.A. (Westinghouse Electric Corp.)
—--- - Evaluation-of -Siticone: Ftuid- for~Replacement of -PCB-Cootants-ir-Ratiway on >
_ Industry, Gratt, Pinal sepomt; . seaport. Nossboas Sen 04 prope Ler ee a e k i
(2) Foss,- Stephen. D.., Higgins.,.John-B..;Jchnston,~Donald hw -MOQUade p Jama
M. (General Electric.Co.), Retrofilling. of Railroad Transf formers, Draft

- Final Report; ‘Contract D@MiSC-ln0s; duly a pe ee >

(3) Dew Coming Corporation, Removal of PCB from Dow Coming 5612) trans-
_ former Liguid by Charcoal Filtration, undated.



transformers are retired from service due t failure. If one-half of the 33
contaminated transformers will be scrapped or refilled with new oil within the
next twenty years, and the rate of such oil disrosal does mot Geperd on the ace
of the transformers, the rate of disposal would be 3.4% per year (i.e., a
failure rate of 3.4% per year implies a 20-year half life). Based on these
assumpticns, annual analytical and disposal costs would be from $21.4

million to $26.1 million in 1979, and decrease in future vears by 3.4% cer
vear as the number of contaminated transformers in service decreases ty

this fraction.

7.4 Summary

Analytical and Disvosal Costs:

1979 - $21.4 million to $26.1 million
Succeeding Yrs - 3.4% less each year .
Total -— $612 million to $769 millicn ° . °

Emoloyvment Tff2cts: .
Analytical services - Assuming that 50% of- the cost of the
aalysis is for labor and that the burdened labor rate is © 9 ~ "7
$30,000 per year, the analytical costs of $75 millicn |
$187 millicn imply 2 total labor demend of 1250 to 3117 man
years, Initial demand would he 48.of this, .cran ine ww. Ln...
creased emicyment in 1979 of 42 to 106 jcbks.

Disposal - The disposal cost analysis presented in Table

7.3-2-assumed that -<direct-Labor-end-swpervisor-tabor costs
were 148. of-the*cost-of ‘disposdl--At“the lebor- rates se
assumed in the table, disposal demand’of $425 milli6n ts”
$694 millicn.would.inply a: labos..demand-at-.an-average-rate——
of $30,000 ver year of ($435 million x .14/$30,000/man year = :
2030) to ($694 million x .14/$30,000/man vear = 3239) man

-49-



(8) The chain effects are also traced backward at least one stage to -
suppliers; price, quality and delivery effects are considered as.
determinants. of quantity ‘demanded. Se

(6) At each stage (supplier, directly impacted producer, customer) '
impacts on the various factors of production were considered.
Physical factors of production at each stage include labor,
materials, equipment, factory space and land. There may also be
impacts on fixed and working capital requirements and capital
markets, including rental or leasing arrangements.

(7) Signigicant externalities are considered in the analysis.

(8) The analysis considers only the costs incurred by the regulations. .
No estimates are made of the benefits to health or the envirorment
achieved by banning the use of PCBs.

(9) Distinction is made between transitional and long term eftaces.
Transiticnal effects include the costs of stenature obsolescerce
of production facilities and equipment, retooling, research and
Long tern effects include increased prices and changes in aggre
gate market demand. . 7 ye

price of cutput
laber employed

-15-



-Z8~

Figure 13.0-1. Distribution and Utilization of Waste Oil in
the United States During 1970-71

Poplied to
Roads

(96 x r0%yat/yey

Used as Fuol
Fase x 108gatyye
Haste OL
Processors:
Gottocted for 300 Flees
ee ee | Ld > 500 Fime (263 x 108
Production of Sales ‘ (91 x 10%sat/yr yal/yed
virgin O1L (2234 x 108 gal/yr.) (1115 x 10°yat/yr) al/yey | sp
(2400 x 108 | — —|4 Nerefinerss
gal/yc.) Plasipated to the “0 Fime
o awirowent, Wastes, Diusipated to the (138 x 20
(246 x 10° gal/ye.) ‘and Spill LJ ravi ronment gal/ye)
(0265 x 10° yal/yed (978 x 10%yal/ye)

Used aa
Fued

(670 x 10% yat/ye)

Process Wastes:
to Diepoaal

(72 x 10%yat/yey

Rerefined lade
OL) Products

Nviied to
wads

(244, 10% yar ye)

Sourus; Adapted frun Table 26, p. 128 of Heinsteln, torman J., (Recon Systans, Ine.),
Waste O11 Iucycling and pispaaal, EYA-670/2-14-052, Princeton, N.J.1 August, 1974,

(0) x 10%9a1/yr)



7.0 OUL FILLED POWER AND DISTRIBUTIGN TRANSFORMERS

PCB-hased askerel Liquids have historically been offered as 3.
higher priced alternative to the petroleum based transformer oil used in
mest liquid cooled transformers. The PCB and oil filled transformers were

manufactured in the same facilities, and many cprortumities were present for ©

the contamination of transformer oil with PCBs. In addition, field servicing
of PC3 and oil filled transformers has been performed using the same equip-
ment providing additional potential for contamination of the oil by PCs a
residual in the equirment from previcus uses. :

There are no reported incidents where PCBs have been intentionally
added to oil filled transformers, and such an cccurrence would be mmlikely . -

“because of the higher cost of PC8s relative to oil. However, analysis of

oil taken from transformers has indicated that a significant number are con-
taminated with PCBs at’a concentraticn above SO ppm. ‘These contaminated ~
‘ransfomers would be subject to certain requizenents under the provisions
of the proposed regulations.

7.1 Requirements of the Procosed Regulations - -
" fransformer oil contaminated with PC3s in concentraticns above
50 pem will have to be disposed of by high temperature chemical waste in-

_ cineration. _Hewever, transformers contaminated with PCRs in the range. of...”

50 to 500 ppm will not have to be marked, nor will there ‘be any restrictions ~~

on servicing, rebuilding, or disposal of the drained transformers.

792. Estimation of the ‘Extent of Transformer-Oil -
“Contamination by aie

Munber of Transformers

Available data .on.US -cransfommer- production -and_sales_co .ret— week
differentiate between oil filled and askarel transformers, but indicate mly
the total production of liquid filled mits of various sizes and tynes. ‘the

-36-



‘The disruption of industrial ‘production caused by the requirement
that contaminated heat transfer systems be removed from service immediately
upon the effective date of thé regulation may result in fer larger’ costs’ than
will the requirement to decontaminate the systems. Here again, the available
information will not support even a guess at the magnitude of the econemic
impacts of the disrupticn on costs, production, and employment. .

11.4 Summary

“Over 500 heat transfer systems may be contaminated with PCBs in
concentrations exceeding 50 poem, but available data is not sufficient to
support an analysis of the costs of decontaminating the systems or the econamic
impacts resulting rom disruption of related industrial production.

-77-



expesed is bolted. ‘he lcaders are used in conventional mining in which the
coal face is dxilled and uderout by a drilling machine. After the coal is
blasted, the loader scacps it up and loads it into a shuttle car. Foot
bolting is also required in this type of mining operation. In either com
tinuous or conventional mining, an entire section with all associated equis-
ment will be idle if the miner or loader is out of service and there is no
stand-by capacity, as is generally the case for small mining cperations.

The output of conventional and continuous mining operaticns has
been conservatively estimated at 250 tens of coal ser section per shict
(eicht hour working day). Given two shifts cer day, each coal mining tech-
nique produces cver $10,000 worth of coal per day (valued at current srices).
Conventional coal mining cperations generally require eleven to thirteen
men; continuous mining operations require only eleven men.

8.3 Compliance Costs z Tt

Loaders.

The PC3-cooled motors presently used in loaders can be readily
replaced or converted to air-cooled (i.e., oy) motors when serviced every
18 t 24 months. ‘The cost of replacement with e new air-cooled mit is _
$6,258 per moter or $12,516 per leader. However, conversion kits are avail-
able from Reliance Electric Cammany, sole motor sumplier to Joy Marufacturing
Company, for $3,100 per kit. Each kit converts one motor, and each loader
uses two motors.

Over the past few years, Jcy Manufacturing has seen converting
the motors on loaders to*aiet ccoling: tAt‘a ‘PCS hearing f1-Ctcaga cn* aay wee
19, 1977, Joy Manufacturing stated that they had converted 353 of these
motors. An additional 95’ motors had been converted.as.cf the middle of .
November, 1977, leaving 652 leader motors to be converted (ncte that this
figure includes the thirty-four spare leader motors). Jey Manufacturing
estimates that all remaining PC3-ccoled loader motors can be converted to

-5d-



12.0 COMPRESSORS

Tarbinol 153, a PCR-based fluid, was tried as a turbine lubricant and
working fluid in natural gas pipeline compressors by several companies during
the late 1960s and early 1970s. Monsanto ceased producing this product in
1972, and the companies that were using it switched to alternate fluids at
that time.

12.1 Requirements of the Proposed Regulations

The proposed regulation would prohibit the use of any systems which
contain liquids contaminated with PCBs in concentrations exceeding 50 pom after

1
the effective date of the regulation.

12.2 Compliance Costs

wo purchasers of Turbinol 153, Columbia Gulf Transmission and
‘Texas Eastern Transmission, were contacted by phone. Neither company had
information available on the residual levels of PCBs in the turbine fluid, _.
but both indicated that the systems were relatively tight, and there was
seldom the requirenent to top off the systems. Based on data available for
hydraulic systems and heat transfer systems, it must be assumed that the
campressor fluids are probably contaminated with PCBs in excess of 50 pm.

There are perhaps ten gas pipeline compressor turbines in use that
have their oil contaminated with PC3s. The proposed regulations would require
that these turbines be removed from use until the concentration of PCBs is
reduced to below 50 ppm. It is not known what costs would be involved nor the
disrupticn to the delivery of natural gas that would result from removing
these turbines from use. Assuming that the complexity of the turbines is
similar to that of the hydraulic systems discussed in Chapter 10, a cost of
perhaps $20,000 and $40,000 per machine may be involved in the decontaminaticn
of the oil systems. ‘Total costs might be several hundred thousand dollars
plus the cost of disruption of the gas delivery system.

The cost of shipping gas by pipeline is established by long tem
contracts. Additional cests resulting frem the provisions of the draft
regulations would have to be absorbed by the pipeline companies.



transfer characteristics than askarel, and an electrical arc in mineral oil”
results in breakdown products that are non-corrosive.

he major disadvantage to mineral oil is flammability; trans-
former mineral oil has a flash point of 145°C. If an are occurs with the
transformer, the breakdown products will be hydrogen and methane,” both of which
are flammable. Detailed records of such failures are maintained by the
electrical industry. Fire Underwriters does not approve of the use of oils and
other flammable liquids for indoor applications. Where oil-filled transformers
are not specifically prohibited as on-site replacements for PCB-filled mits,
the National Electrical Code imposes certain restrictions. upon their mode of '
installation.

Qil-filled transformers are used in almost all power trans-
fommer applications and for most substation distribution applications where
the transmissicn line high voltage is reduced to 12.8 kv for local distribution.
Most rural pole-mounted transformers which reduce the voltage to 220 volts are’ - ~ 7"-
also oil-filled. The issue of flammability only beccmes imrortant where the
distribution transformer mist be buried, as in many urban applications, cr
located close to, within, or on the roof of the building it serves. PCB-filled
transformers have, in the past, been used in most such applicaticns. Cil-filled
transformers can be used in these applications only if they are suitably isc-
lated from flammable structures or if these structures are suitably safequarded
against fires. When transformers are located outside the building they service, -
the low-voltage power must be brought into the building via cables or insulated
buses. This causes additional energy losses due to heating in the low-voltage
transmission lines from the transformer to the point of use.

Oven Air-Cooled Transformers

Transformers can be built without the use of a liquid cooling
medium. One type of dry transformer that is quite successful, under limited
conditions, is the cpen air-cooled transformer. In this design, cooling air _
is driven through the transformer by either natural convection or forced circu-
lation. In those sizes where air-cooled transformers are available, they are

-113-



Because of the necessity for a pressure vessel container, ~~
gas-ccoled transformers are 30 to 40 percent heavier than PCB-filled transformers,
and cost two-thirds more (and twice as mich as oil-filled transformers). In ad-
ition, the gas-filled transformers mst be sized larger than oil-filled mits
to allow for the expected heavy lead peaks of power consumption, ~

16.4 Relative Prices of Non-PCB. Transformers
The relative prices of distribution transformers of the size
. and type commonly installed in office buildings are summarized in Table 16.4-L.
If the RiEmp high fire point liquid filled transformer proves to be acceptable
for installation without auxiliary fire protection, there should be no cost
increases for new transformer installations resulting Srcm the ban on the
manufacture of PCB transformers. The open dry type transformers are also quite
cost competitive with the PC3 umits for most applications.

'

Table 16.4-1) . ; oe
Relative Transformer Prices
Type of init Price: 1000 KVA Unit Price: 2000 AVA Unit
Oil filled $ 15,300 $ 23,300
re - 19,900 “30,300
RIED 18,400 28,000
Silicone 22,300 - 34,500
Open air cooled 20,700 35,000
Sealed gas cooled 30, 600 46,600

Source: MOC Engineers, "Distribution Transformer Status - WII Project",
Memorandum to U.S. General Services Acministration, June 1, 1977.

| =lle-



5.0 IMPACTS CN TRANSFORMER SERVICE COMPANIES . so

Maintenance of askarsl ttansfomers is usually contracted out to roe
specialized service shops or to the ‘nanifacturer of the unit. Major “rabuild-
ing is usually performed by the manufacturer. There are approximately 250
small service companies which can perform routine transiomrer ‘sexvicing such
as gasket replacement and testing of the liquid.

Based cn a telephone canvass of independent companies which service and
repair transformers and on information obtained during visits to G and :
Westinghouse service shops, it is apparent that exising 5C83 transfommer re- '
quiring in-shep repair work are being serviced only by the G= and Westing-
house service operations. These two companies have reduced the number of
shops presently permitted. to service PCB transformers to 15 and 8, respec-
tively, for a total of 23 shops nationwide. () ‘These shops are performing
the major warantee maintenance for both Gé and Westinghouse and for, the’ .
ether transformer manufacturers. There are approximately 250 small electric
apparatus service shops which repair teansformers. (25° These shops no longer
work on askarel transformers because of the risks of major cleamup costs and
worker exposure that would be incurred by any accidental spill.

5.1 Impacts of the Proposed Regulations : : toe

The effect of the proposed regulations would be to emi the practice _
f_remiildi rat would be no constraints on continued —_

minor field maintenance. The effects would therefore be limited to a de- .
. creased demand for the. major sernrices. performed by the service. shoms cwned by .. _

. the mamfacturers. These same companies would be faced with an increased

s+ -(L)— Versar--Ine. 7-PCB + Activity-Analysis—Parers; —Spectel-Repert,-E>3 | aan
July ll, 1977.

voetOp- Electricai-3 mpparabas-Service-ASsoCia se CLOT - LS PPL OTE
St. Louis, MO: 1977. ~ ae



Table No.
15.2-2
15.3-1

15.3-2
15.3-3
16.2-1
16.4-1
17.1-1

PCB Capacitor Sales - by Year

Currently Available Non-PCB Power Factor Correction
Capacitors ..
Manufacturers of PCB Industrial Capacitors in 1976 ....
Manufacturers of Snall Liquid Dielectric aC Capacitors

U.S. Transformer Manufacturers Which Used PCBs After 1970 .

98

101
102
103
uo



Magruder; Robert $ ‘(continental Forest Industries) , testimeny presented at
the. U.S.. EPA infomnal hearings on the PCB ban regulations, Washington, D.C.,
Jaly 15, 1977. tes

Mauch, THe, Rerefined Oil: An Option That Saves Oil, Minimizes Folluticn",
Science 193, p. 1108-1110, September 17, 1976.

Metropolitan sit Authority, Annual Report, 1976.
Michigan Department of Natural Resources, File Meno, undated.

Monsanto, Chemical Camany, Aroclors for —-, St. Louis, M.: wurdated. ,

NJ; Department of Transportation, Hichlichts of Activities, 1976.

Rouse, T.; Raab, E. (General Electric Co.), U.S, Transformer Oil’ Supply and
Demand, 1975-1985, Interim Report, Palo Alto, Calif.: Blactric Power Research
“Institute (Repart No. EL-303), Nov. 1976.

SEPTA,, Report to the Public and Financial Statements for 1974 and 1975 -*
Statement of Operations.

Thomas, Hugh (Outboard Marine Corp.), Presentation at the EPA Informal Hearings
on the P¢3: Ban Reguiaticns, Washington, D.C., July 15, 1977.

U.S. Department of Agriculture M Hee Group on PCRs. A nilture's F
bility Concerning Polychlorinated Biphenyls (PC3s) Washington, D.C.:
Ot Science and Education, U.S. Department of Agriculture, 1972.

U.S. Department of Commerce, Electrical Measurement and Distribution Squinment,
Publication MC(2=36A).

Versar Inc., Assessment of the Environmental and Economic Impacts of the San on
imports_of PCBs, EPA 560/6-77-007, Feoruary 22, 1977.

Versar Inc., Involvenent of PCBs in the Pulp and Paper Industry, EPA 560/6-77-005,
February 25, 1977.

Versar Inc.., Microeconomic Impacts of the Proposed Marking and Disposal Regu-
lations for PC8s, (EPA Report No. 560/6-//-0l13), Springriald, Va.: Natsonal
i Intomnation Service (NTIS No. P8-267 833/2WP), April 26, 1977.

Versar Inc., PCB Activity Analysis Pavers, Special Report, EPA/OTS, July 11, 1977.

versar Inc., PC3s_in the United States: Industrial Use and vironmental distribu-
Springfield, Val: Nationai Technical Intormation Service (NTIS PS
Fe i027 ney” February 1976.



contamination of this type. of .transfommer.

The remaining-250,000 lighid cooled transformers manufactured in
1972 included about 5,000 askarel wits. Assuming that there are 140,000
askarel units in service and that the ratio of ail coooled to askarel trans-
fommars has always been 40 to 1, as was the case in 1972, then the calculated
number of oil cooled transformers other than pole mounted would be 6,850,000.

Alternatively, it could be argued that since the ratio of the
total number of pole mounted transformers to the 1972 production of this type
of mit is 30,000,000 to 1,253,000, that this ratio times the 1972 production
of other types of liquid filled transformers would give the mumber of cther
transformers presently in use. By this method ‘df, calculatim, there are.
6,000,000 nen-pole munted Liquid filled transfckmers in use, minus the
140,000 askarel units, or a total of 5,850,000 oil ed mits.

another method of deriving the total’ mmber of oil-filled Gans-
formers is to calculate the production of transformers from available data
on sales of transformer oil. ‘The annual sales of’ transformer oil from 1968
through 1977 are summarized in Table 7.22, below: |

TABIE 7,2-2
- ____ Annual Sales of Transformer oil in the us,
— , Year Sales: Million Gallons
1968 70
1969 R
1970 oe 75
wm 16
1972 oe a2
1973 7 94
bm. 96
1975 _ 70
1976 5
1977, 78 (est.)

(1) Rouse, T.; Raab, E. (General Electric Co.), U. S, Transformer Oil
Supoly and Demand, 1975-1985, Interim Rerort, Palo Alto, | 3
Electric Power Researcn instieute (Sport NO. EL-303), Nov. 1976.

-3g=



LIST.CE TABLES

Table No. foe . “> Page

L.2-L Estimates of Cumalative PCBs Production, Usage, and Gross ©
Envirormental Distribution in the United States Over the
Period 1930-1975 in Millions of Pomds...... re)

L.S5-1 Effect of the Proposed PCB Ban Regulations on Various
Uses of PCBS © ww ee ee te ee ee Pe re =)

6.2-1 Railroad PCB Transformers ... 2 2. ee ee ee wee ee) 2B

6.4-1 Cost of Processing Retrofilled Railroad Transformer Licuid
to Reduce the Concentration of PCBs ...... pees 32

6.5-1 1976 Cperating Lesses of Railroads Using > ‘Transfomers » 34

6.52 Labor and Overhead Costs of Retrofill and Processing Program -
for Railroad Transformers 2... ee ee ee ee ee 35

7.291 Number of Liquid Cooled Transformers Manufactured: 1972 _ 37
7,2-2 Annual Sales of ‘Transformer’ Oil in the U.S. 2 2. 2. 2. 7 98
7.3-1 Preliminary Cost Estimate for a Chemical waste Incinerator

for Transformer Oil Contaminated with Low.Ccncentrations~ .

Of PCBS fw ee 43

7.3-2 Annual Operating Costs for Contaminated Oil Incineretor .. “44

7.3-3 Testing and Disposal Costs for Transformer’ Oil... tea at
7.34 Testing and Disposal Costs for’Transtormer Oil. ...... 48
8.2-1 Production Statistics & Present Use Status of PC3-Cooled
Mining Machines 26 1 ee eee ee ee ee ee ee 52
8.3-1 Cost Impact of Forced Retirement of PC3 Cantinucus Miners . 57
10.3-1 © Present PCB Levels’ in Die Casting Machine Hydraulic ~ .
SVSteMS wk ee 2.) 67
10.32 . Industry Estimates. of .the.Cost.of Draining, Flushing, and... - .
Refilling Die Casting Machine Hydraulic Systems ....... 68
10.3-3 Estimated Cost of Decontaminated Hydraulic Systems ..... 70
13.0-L New Oil Usage and Waste Oil Availability for Recycling :
MSS ee rr:
15.2-L PCB Capaciter Preduction and ‘gales: 172 2... we ee 97



TABLE 6. 4-1

Cost of Processing Retrofilled Railroad Transformer . fee
Liquid to Reduce the Concentration of PCBS _

Cost of retrofill . $ 20.00 per gallon
less cost of silicone - 12.00 "
less cost of flushing Liquid - 42 =" "
less cost of incineration of 2 gallons . - 3.00 " "
Labor, overhead, and analysis costs : 4.58 per gallon
plus .1 gal silicone cer gal of transformer
capacity .1 x 12.00 = 1.20
plus 2 lb carbon per gal @ .é60/lb . 1.20

plus. disposal of 3 1b wet carbon. rer gal @ .15/Ib “645
TOTAL PROCESSING COST . "7° $"7.43 per gallon
Cost of processing as a fraction of cost of retrofilling =
7.43/20.00 = 37%

Cost of orecessing retrofilled transformers: : oon. -

Analysis for PCBs* 1,009 mits @ $75 : - $ 75,675
Processing $7,043,000 x .37 . 2,616,000
Analysis* 75,675
Second processing = 2,616,000
Analysis* —.——.0 ee ee - «= 75,675

Total cost of processing to meet 1,000 pom limit
. on PCBs $5,460,000

*Bnalysis conducted 12°to-24 months’ following =~
previous retrofill or processing... ....-..

-32-



Underwriters Laboratory. presently lists three liquids as
meeting the ‘High Fire Point' property requirements for transfommers operating
at voltages below 600V: ; :

Dow Corning 561
General Electric SF-97 (50)
SWS Silicones Corp. F-190

Factory Mutual Research has not yet completed cevelcping
formal approval requirements and procedures for 'High Fire Point T:ansformer
Liqguids'. However, based on preliminary tests, Factory Mutual has issued :
interim guidelines to its field offices that six silicone liquids and three
hydreearbon liquids could be accepted at Factory Mutual insured Iccations
without special fire protection. The list of Factory Mutual accepted liquid |
includes: 7

Supplier Designation Type of Fluid
Dow Corning oc S61 Silicone
Dew Corning pc 200 Silicone
General Electric SF-97 Silicone
Union Carbide L-305 , Silicone
SWS Silicones — FeloL "Silicone —
SWS Silicones F-190 Silicone
RTE Corporation RTonp Hydrocarbon
Gulf Oil Chemicals Co. RF Dielectric Hydrocarbon
Fluid
Uniroyal PAO-20E Hydrocarbon

Mineral 0il-Filled Transformers

Lf Sire safety were not a consideration, there would be no rea-
son why oil-filled transformers could not be used in all applications. in the past,
FCS-filled transformers have cost about 1.3 times as much as oil-filled units ©
of the same capacity, and thus most users preferred the oil-type where possible.
The oil-filled transformers are the same size as the askarel wits, and are
considerably Lichter in weight. Also, mineral oil has scmewhat better heat

-112-



(2) ‘Whether certain uses present an unreasonable risk to -
health or the environment. ‘This. criterion ts Be
_ used as the Lasis for authorizations of activiti
that are-not conducted in a totally enclosed Tanner,
and in evaluating petitions for one year eenpticns
from the mandated bans on the manufacturing, processing,
oT an in commerce of PC&s. ([Secticn. 6(e)

GI These activities which, although not conducted in a
totally enclosed manner, nevertheless will not pre-
sent an unreasonable risk of injury to health or the
enviroment. [Secticn 6(e) (2) @)].

The proposed "PC3 Ban Regulations” state these’ findings, incom
porate the mandatory requizements established by Congress, and would grant
authorizations for continuation of certain activities based on the findin
These regulations were prepared by the EPA Office of Toxic Substances in
cooperation with the Interagency PCB Work Group. ‘the basis for the prepesed
regulations is the finding that there is no identifiable level of PCB -re- a ee
lease to the environment that cen be considered insignificant. Therefore,
only totally enclosed activities such as continued usage of existing trans-
formers and capacitors.uill_meet the criterts- rec red after December Jl, 2
1977, , a - me ee

The Taxic Substances Control Act grants the ZPA authority to . ‘- -
permit other PCB activities after the end of 1977 if the activities do net
: . neni! : a . noting onder:
this authority, the EPA in the proposed ban regulations would semnit the
following C3 activities in other than a totally enclosed manner.

(a) Contimied minor maintenance of PCB transformers to
re mamma amare te EST TTF ZO APTN TIS EOL OSS | te EMT IE, emerge cance = +

premature retirement and-lack of replacement units.

eae we.) ...Combimied “use. and scheduled phasemoit of use of POR. 8.
railroad locamtive nower transformers.

-ll-



camatible non-?CB fluids. As a result; the PC3s in service in these me ;
chines in the early 1970's have been’diluted. Information obtained during
the course of this study throush a phone survey of users of these systers
indicates that the fluid presently in the machines may contain from 60 pom
to 50 percent SC8s, derending on the amount of leakage end replacement over
the past five. years, oS :

When Mensanto discontinued the manufacture of PCB based
heat transfer liguid in 1972, they recommended that existing systems be
drained and flushed and the liquid replaced with a ncm-PCB liquid. A num
ber of systems were maintained throuch 1974 with PCBs manufactured by a.
small chemical camany, but no FCS heat transfer fluids were manufactured
or imported after 1974, and it is believed that all systems have been
drained and converted to non-PC3 fluid. ‘he effectiveness of the initial ~
flushing procedure is known for only one system whictt'was flushed in 1972
and presently is using a fluid which is contaminated by two percent
PCEs. .

PCAs were used as a working fluid in a number of turbine
compressors on natural gas pipelines in the early 1970's. Althouch the -
PCB oil has since been drained and the turbines flushed and refilled,
residual PC3sare present toa toreentration of wp -to-several thousand parts ——
per millicn in the oil.

Another use of PCBs was as a minor additive to certain
autempbile transmission fluids to cause controlled swelling of rubber
seals, Although this use stopped in the early 1970's, waste lubricating .
oils have been recorted to contain PCBs in concentrations of parts per
million. Transmission fluid from older automobiles. may be the source of this



5.0

6.0

7.0

8.0

9.0

““TABLE-OF ‘CONTENTS (Gont'd.)

IMPACTS CN TRANSFORMER SERVICE COMPANIES ...
5.1 Impacts of the Proposed Regulations ...
5.2 Summary... ee ww ee ew ee ee
RAILROAD LOCOMOTIVE TRANSFORMERS .. 4. - es
6.1 Requirements of the Proposed Regulations
6.2 Present Cwnership and Use... 1.1 eee

.6.3 Tecimical Alternatives for PCBs in

Railroad Transformers . 2.11 ee eee

6.4 Cost Impacts of the Proposed Regulations. . .

.

6.5 Econamic Impacts of the Proposed Regulations.

6.6 Summary... we ee ee

OTL FILLED POWER AND DISTRISUTIGN TRANSFORMERS

7.1 Requirements of the Proposed Regulations .

7,2 Estimation of the Extent of Trans-
former Oil Contamination by PCBs ....

7.3 Costs of Complying with the Proposed _

7 Regulations... 1. ee ee ew we ew
7H Summary. we ee ee

8.1' Requirements. of the Proposed Regulations.
8.2 Ownership and Use of PCB Mining Machinery

(€,3 Compliance Gosts 6 ee eee

8.4. Summary ess Se re ee ee

-ELECTFOMAGEETS «wn cw ee we et ee we

Q.de Requirements of the’ Proposed” Regulations.
9.2°. Compliance Costs” 6. ee ee ee

iv

.

.

Page.

2. 25
. 26

2. 26
«+ 27

«+ 27

oes

oe 36
oe 36

ow. 41
22 49

2. 32
oe SL
o. SL
2. 54
a)
- + 60
«+ 60
oe 61



Item (Chapter) ‘ No. of Jobs (1979) ‘Total Men Years
Lost Production fram -. potential for thou- "500?
closing of facilities during sands of layoffs early
decontamination in 1979 in the steel

industry for several
months ©
Spill prevention plans +5 +
Reporting requirements +7 +
Heat Transfer Systems (11)
Decontamination progrem ? ?
. t

Campressors (12)

Decontamination program +1 +1

Reclaimed Oil (13)

Ban on reclamation of contaminated “12 wills -24 to 30

hydraulic fluid
Diarylide Yellow Pigments (14)
Loss of jebs in manufacture of pigments

Capacitor Manufacturing (15)
Transformer Manufacturing (16)

17.4 Other Economic Impacts

-200

+15

Jeb losses offset
by increased aemploy-
ment in manufacture
of substitute

materials.

0.
+1470

No significant market shifts are anticipated to result from the ban
on the use of PCBs in the manufacture of capacitors or transformers.

The only siqificant impact on energy demand will be for the oil
required to replace the contaminated transformer oil, hydraulic fluid, heat
transzer fluid, and compressor fluid which mist be drained and incinerated as
part of the decontamination program. This requirement will be insimificant
when compared with total oil consumption, carticularly since the increased
demand for transformer oil will be spread over 20 years or more.

-124-



TABLE 15.3-2
Manufacturers of PCB Industrial Ceracitors in 1976

Company Name Location of the Plant

General Electric Company Hudson Falls, N.Y.

: Ft. Edward, N.Y.
Aercvox New Bedford, Mass.
Universal Manufacturing Corp. Bridgeport, Conn.

. Totowa, N.J.
Cormell Dubilier New Bedford, Mass.
P. R, Mallory & Co., Inc. Wayneskoro, Tenn.
Sprague Electric Co. North Adams, Mass.
Electric Utility ©. LaSalle, Ill.
Capacitor Specialists Inc. Escondido, Calif.
Jard Corp. " Bennington, Vt. ;
York Electronics . Brooklyn, N.Y. es
RF Intercnics Bayshore, L.I., N.Y.
Axel Electronic, Inc. Jamaica, N.Y.
Tobe Deutschmann Labs. Canten, Mass.
Electro Magnetic Filter Oo. Sunnyvale, Calif.

Source: Versar Inc., PCBs in the United States: Industrial
Use_and Environmental Distribution, Springfield, Va.:
National Technical Information Service, (NTIS PB 251 402/3WP),
February 25, 1976, p. 89. Updated by Versar in later
studies, Contzact 68-01-3259.

~102-



Since incineration of the electxcmacnets is not feasible, eaci owner will
-be required to submit a written application to the Regional Acministrator .
requesting permission to dispose of the smits in a chemical waste lendfill. wr

9.2 Compliance Costs

The PCS electromagnets could be replaced with oil filled mits at
an average cost of $8,000 per magnet. Ecwever, use of mineral oil in these
applications would siqnificantly increase fire risks. ALL of the manufac
turers regularly fumish magnets filled with silicone fluid for use where
fire characteristics superior to téensformer oil are required, Such silicon i
filled transformers are 40 to SC% more expensive than oil filled wits, i.e.,
$12,000 per everage mit.

Eriez also offers a proprietary air cooled electroraqet which
has Underwriters Laboratory approval for use in dirty and dusty envizorments. .
This mit costs about 30 percent more than an ‘oil filled magnet, i.e,
$10,400 cer average mit.

Replacement costs for suitable magnets ts would be $10,400 & $12,000
x 200 units = $2,080,000 to $2,400,000. Delivery and installation ccsts would _
be an additional ten to twenty percent. As in the case of mining machines
(chapter 8), the increased costs would be exmected to te absorbed by the coal
mines es reductions in profits. These costs should not result in any loss of

7 Tenployment or Sracickion TT a

To = Detivery of 260 replacement magnets would requime: four ta ser ne
‘months. O) preration of~the-coei-crushers-without-protectionto-renove-tremr— -

~tosses~in-productiom.— Radio frequency -metai detectors-can- detect metal-end-—: =~

shut down a conveyor belt until the metal is removed manually. These systems

(1) Consensus of industzy cpinion cbtained throuch a phone
survey Ey Versar Inc.

-61-



Secondary econamic effects which are discussed where relevant include ©
wages paid, materials used, product redesicn, new investment, space require-
ments. servicing costs, product reliability, fire safety, and analytical”
testing costs. : . a

2.2 Definition of Economic Impact

Impact is defined as the changes resulting from the implementation
of the regulation. Calculation of the impact requires that the base con-
dition be carefully defined to exclude the effects of the proposed requ-
lation but to include the‘ effects of standard industry practices and other
relevant regulations and laws. In the present case, the base period used to
define industry practices is assumed to be 1975. Thus, the effects of the ;
voluntary ban on open system uses of PC3s that was taken by Monsanto in 1972
is fully reflected in the base condition, but other actions taken by
industry in anticipation of the requirements of the Toxic Substances Control
Act do not affect this base condition. The impact analysis then distin-
guishes the impacts of the proposed ban regulations from the effects of the
PcB Effluent Discharge Regulations, the PC3 Discosal and Marking Regulations,
and the ban provisions of the Act which caused Monsanto to cease PCB - ;
production in 1977. .

Versar used two major data resources to establish the base
conditicn: .

(1) Testimony at the public hearings in Washington (July 15, 1977)
and in Chicago (July 19, 1977); and

(2)... Interviews with affected parties, conducted mostly ny telephone...
with information contacts established by Versar during: previcus
PCBs study tasks:

-16-



This analysis of the proposed reculations considered both the
dizect costs of complying with the requirements and the indirect effects
of these requirements on price levels, capital needs, employment, energy
consumption, and the availability of strategic materials. ‘he calculated
economic impacts were the incremental impacts of the proposed regulations
on a base of 1976 practices as mdified by the previously pramulgated ?C3
effluent standards and the marking and disposal regulations. The costs
of these other PCB regulations were considered during their develorment
and are not considered to be a result of these proposed ban regulations.

1.2° PCBs Usage in the United States

PCRs have been used in the United ‘States since 1929. Major’ used
of this chemical have included transformer cooling liquids; capacitor di-
electric liquids; heat transfer and hydraulic liquids; as a dye carrier
in carbonless copy paper; as a plasticizer in paints, adhesives and
caulking compounds; and as a filler in investment casting wex. A previous
EPA contractor report 1) estimated the usage and distribution of PCBs m0
be as shewn in Table 1.2-1.

(1) Versar Inc. PC8s in the United States: Industrial Use and Environ-
Mental Distribution. Springfield, Va‘: National Tecimical Infomma-
tion Service (NTIS PB 252 402/3WP). February 1976.

-2-



the repair of askarel transformers in 1974. Assuming an average transformer

capacity of 240 gallons, of PCBs (300 gallons of '‘askarel' mixture) this ..

implies that a total of 335 askarel' transformers were repaired duting that year. —
This would have to be considered a lower bound estimate of the future impacts

of the ban on rebuilding as the rate of failure of askarel transformers: is

expected to increase as the average age increases. An upper bound estimate

might reasonably be based on an average expected remining service life. If

it is assumed, for example, that. one-half of the existing askarel transformers

will be removed fram service over the next twenty years due to failure or -
ebsolescence, an average rate of remval from service of 3.4% of existing - t

units is implied. If the probability of failure or removal were independent .
of the age of the mit, it would be expected that 3.4% of the 140,000 existing . -
units would be’ retired in 1979, or a total of 4,760 units remved, of which

1/3 to 2/3 (1,587 to 3,173) would have failed. ‘The range of expected failures”

would therefore be about 335 to 3,173 transformers per year, resulting in annual
costs due to foregene savings of $2 million to $19 million per year during the

next few years. At an average failure rate of 4760 units per year and an

average rebuilding ratio of 50%, foregone savings’ would be $14,280,000 in 1979.

Lost Service Time : ote - nen
Transformers Can be rebuilt and returned to service in. three --)

four weeks, campared to a delivery time of 12 to 16 weeks for new units. In

--—She_case_of many_smel]_manufachiring comaines, tailure of the single trans=—. wee

former which supplies all of the power for the facility can stop all oper-
ations until a satisfactory replacement unit is cbtained. It is likely that
greater supply of replacement units will become available in response toa ._...

avoid prolonged-loss*of electric-service. -There is ‘no information available ;
as to the costs of renting replacement transformers, but assuming a reasonable

monthly rental of 2% of the cost of the unit, total costs due to the longer

21-



be to lower the price. However, since use on coal in boilers is relatively”
troublefree and expandible, this use is probably very eleastic. Consequently
if coal burning plants can absorb the increased supply, which seams likely,
the price decrease should be negligible. :

Re-refiners

Re-refiners of lubricating oils should be operated at capacity and
thus be more profitable. The recycling ethic potentially can be used to
expand the market for used lube oil’ faster than industry capacity. This will
be especially true for industrial and commercial fleets, but might be extended
to personal cars. Similarly, increases in domestic crude oil prices would
increase the market for all uses of waste oil.

: Information.collected through telephone interviews indicates

that at least three of the companies which re~refine hydraulic fluid receive
hydraulic fluids which are contaminated with PCBs. These fluids are sometimes
contaminated to the extent of 6000 ppm. In most cases, the reclaiming procéss|
removes no more than 10% of these reas, (1) It is also reported that the con-
centration of PCBs in same of the hydraulic fluid applications ericountered

by these companies remains at approximately 2000 opm despite repeated flushings
and drainings. In such cases, lower FCB levels may be achievable through the
use of activated carbon filtration. -

those hydraulic systems contaminated with PCBs will be identified

as required by other provisions of the draft regulations. (nce this is done,
waste oil from these machines and fran the oil separators in plants using the
machines will probably have to be diverted from fuel use to chemical waste
incinerators.

The price differential between re-refined and virgin hydraulic
fluid is about four dollars per gallon. The requirement that contaminated
hydraulic oil be incinerated may reduce the supply of re-refined oil fram
150,000 gallons per year to 50,000 gallons per year. This would result in
increased costs of ($4.00 per gallon x 100,000 gallons per year = $400,000

(1) Telephone conversation, Dwain Fowkes (RADCO Corp.) with L. Fourt (Versar),
September 19, 1977.

-90-



REFERENCES, CONTINUED

Versar Inc.; Price Schedule - Quantitative. analysis ‘of PBs in ‘lo-¢ Beansfomer
Oil (Price Sheet 100), Springfield, Va.: May 1, 1978. :

Versar Inc., Usage of PCas in Goen and Seni-Closed systens and tid Resulting
Losses of PCBS to the Emvirorment. EPA 500/é-77/-009 (unpublished Draft Report) ».
September 1, L976.

Walsh, E.J.; Voytik, D.E.; Pearce, H.A. (Westinghouse Electric corp.) Evalua
of Silicone Fluid for Replacement of PCB Coolants in Railway Industry, Dre
Final Report, Report No. DOI-Tsc-1294, July, 1977.

Ward, William (General Motors Corporation), Presentation at the EPA Bearings
the PCS Ban Regulations, Chicago, Illimeis, July 19, 1977.

Weems, Gearge (United States Department of Interior, Denver, Colorado), .
"Polychlorinated Biphenyls”, File HLS 3-3-10h, June LB, 1977.

Weinstein, N.J. (Recon Systems, Inc.), Waste Oil ‘Recyeling and pisrosal
670/2~74-052, Princeton, N.J.: August, 1974,



TO

Fate of Oil After . . . Percentage of New
Primary Use Qil Preducticn
Used as fuel “als.
Dissipated to environment 42.3
and waste disposal
Applied to roads : 12.9
Re-refined lube oil orcducts 3.3 .
100.0

The general distribution portrayed in Figure 13.0-1 is believed to be
valid at present, although the magnitudes of the specific flows have fluc- 1
tuated as prices of virgin lube oil and fuel oil have varied. The value of
fuel oil has increased since 1970-71, and virgin lube oil was scarce during
the period of the Arab boycott amd during a portion of the period of price
controls. One result of these factors has been increased use of waste oil
as fuel, either internally by industrial concerns which generate waste oil
or via processors. —— . —

The primary sources of waste oil available to collectors are service
stations and other automotive-related facilities. Industrial and avaiaticn
facilities are also significant sources. A significantly larger fraction
of available oil is collected in urben areas than in suburban.or rural areas.
Based on stirlies in the Pittsburgh area, spills and other wastes from product
pipelines are a locally significant scurce of waste oil for collection.

The use pattern of processed or rerefined waste oil is extremely dif-
fuse. Users include states and mmmicipalities (reed application), indus-
trial and commercial facilities (fuel, re-refined lube oils, road oil),
utilities (fuel), and the consuming public (re-refined motor oil).

A small portion of the collection and processing of used hydraulic
oils dees not follow the general pattern of scattered sources, many re-
claimers, and mmerous users indicated for the waste lube oils. Reclamation —
of used hydraulic oil, performed in most part by four companies, results in
a product which is marketed as hydraulic oil.

-33-



|

|

Table 1.2-1 .
t
Estimgtes of Cumulative PCBs Production, Usage, and‘Gross Environmental

t ‘ : . Estimated
: + Cannerctal | Comercial * Intustelol PObs Currently | fCBs Current! rs Ratlabi lity
L Production Sales Purchases of PCD dn Servics in Enviroiment Destroyed of Values
t t °
U.8, POS Production { 21,400 + 3
: - 200
‘Total U.3. POD Inports a 2 Jo8
U.5. fB Bowstle Uspge 1,253 . . ‘eos
ra i : ‘= 208

Total U.S4 PCB Exports 250 £200

ria! ?

FCB by Use Category) : >
Fetroleus Audi tivel 1° 2 sm
leat Transfer 20 101
isc. Industclal n . ¥ 158
Carbonless Copy Peper 45 tt
ftydeaul {cs an Pubficante 80 + 100
Other Plasticizer pes 1s 2 15t
Capacitdrs 630 450 £208
Transforbers 335 300 4 208

Uses Otned than Electrical a . 4,608

- +—

PCD Degraded or Inctperateds
Bwvirongentally Degraded . 30 2 70a
Incinergted — : . 25 2 100

T

Landi fend FCS tp veer *

. and Trans. Pr thon .
on, nl i . alo 4 208
Cusoletg Elé. Equipment 80 a4
Other (paper, plastic, etc.) . 100 2 408

Pree 100s }ty the Baviroment
(soll, ater. alr,{ sediment) : 150 + 308

wort { \ 2,403 1,403 1,253 “158 440 $5

4 ‘ 7 a
4 5 ‘ ‘
' ‘
i !
‘
i ' ' ~ ,
t . .
i ‘ tone . .
j ! . oes ‘



Users Other than Road Oilers’

About 27 million gallons per year of transformer: oil will not be
available to collectors, thus initially reducing the total supply. Other
industrial oils may or may not be contaminated with PCBs; to be absolutely
safe, the recycling industry would avoid them. Individual industrial firms
can probably contimue to use their own waste oil as fuel oil if they make
initial and occasional later spot check laboratory analyses to make sure their
oils comtimue to contain less than 50 ppm PCBs.

' ‘The impact on re-refiners (who make re-refined lube oil) and
external processors (who process waste oil for use as fuel oil) will depend
on what happens to road oiling. A strict enforcement policy with cccasional
all-out efforts to find PCBs in waste oil could prevent its use as road oil.-
Diversion of waste oil from this use would create a large increase in supoly
for processors and re-refiners. Probably mst of this would originally go to
fuel oil use since the capacity of re-refiners is Limited and the consumer
acceptance of used motor oil is limited. Later, a majority of the increase
might go to re-refiners if the Frost and Sullivan market projections of 23
gercent growth per year until 1985 proves to be even roughly accurate. )
This would provide an extra use as lube oil while retaining most of the heat
value for later use.

Collectors

If collectors avoid transformer and industrial oils, their total
business will decrease. However, haulage of the contaminated oils to chemical
waste incinerators will be required and could offer new market opportunities
to the collectors. oO

Processors

Waste oil for fuel use should become more plentiful as use for
road oiling is discouraged or made impossible by the regulation. ‘The effect
of a larger supply of waste oil on the price to processors theoretically would

1) Maugh, T.W., “Rerefined Oil: An Cption That Saves Oil, Minimizes Pollution”,
Science 193, p. 1108-1110, September 17, 1976.

~89-


Diary lide: Yeltow Proments

Diarylide pigments are the major yellow picments used in
printing inks. These pianents are made by reacticns of precursors which incluce
dichlorobenzidine. A minor side reaction results in the deamination of the
benzidene resulting in the formation of 3,3'dichlorobiphenyl. Accarding to
Don Morgan of the Dry Color Manufacturers Association, most diarylide yellow
pigments are contaminated with PCBs at concentrations of several hundred parts
per millicn. Although a few batches of pigment have bean found to contain less
than 50 pom PCs, the industry is not yet able to control the manufacturing —
Procass to reliably achieve this low level of PCB contamination. ‘

Sales of diarylide yellow pigment in 1976 were abcut 12.66
million pounds having a value in excess cf $52 million. ‘4 _ This pigment was
contaminated with perhaps several thousand sounds of 3,3'dichlorcbiphenyl, which
is a relatively bicdegradible isamer of 5CB. If the proposed FCS ban reculaticns
result in an efZective ban on the manufacture of this yellow dye, mst colored
printing inks will have to be reformulated, resulting in same lest production
while technical changes are made in the $690 million/year ink industry and the
$43 billion per year graphic arts industry.

. There is no technology available that can reliably reduce the
eqncentration of PC@s in diarylide yellow pigments to pelew 50 pom. If the ban
on the manufacture of PC8s after December 31, 1978, results in an effective ban
con the manufacture of this pigment, lost sales of this material will be about
$52 millicn per year. Alternative picments are available, but their use results
in higher ink costs as the alternative materials are less effective and/cr more
expensive. Increased costs due to the conversion to substitute materials may
equal 20 percent to 50 percent of the value of the discantinued yelicw pigments,
ce $10 million to $25 million per year. There should be no net employment effects
as the production of substitute materials will offset the losses from the discon~
tinuation of manufacture of the diarylide yellow. However, several hundred jops
may be affected at the impacted manufacturing facilities, and an unknown amount
of precuction equipment would lose econamic value.

(1) Teleprcne conversation, Don Morgan (Attorney for the Dry Color Manufacturers
Association) with R. Westin (Versar), September 22, 1977.

-94—



Table 16. 2-1

ST

U.S. Transformer Manufacturers Which Used PCAs After 1970

Company Name
Westinghouse Electric Corp.

General Electric Company

Research-Cottrell
Niagara Transformer Co.
Standard Transformer Co.

Hevi-Duty Electric
Kuhlman Electric Co.
Electro Engineering works
Envirotech Buell

R.E. Uptegraff Mfg. Co.
a.K. Porter

. Van Tran Electric Co.

Plant Location
South Boston, Va.”
Sharon, Pa.

Rome, Ga.
Pittsfield, Mass.

Finderne, N.J.
Buffalo, N.Y.

Warren, Chio
Medford, Oregon

Heleria;.Alabama
Goldskéra, N.C.
Cxystal,

angs, Miss.

Lebanon, Pa.
Scottsdale, Pa.

Belmont, Calif.
Lynchburg, Va.

Vandalia, Til.
Waco, Texas

Versar Inc., PCBs _in the United States: Industrial Use
and Environmental Distribution, Springfield, Va.: National
Technical Inrormation Service (NTIS °B 251 402/3WP),
February 25, 1976, p. 89.

-110-



Cost _Immact of Forced Retirement of ?C3 Continuous Miners

Nutter of Number of Opportunity
Continuous Continucus Cost Due to
Company Miners Miners Absence of
No. Medel cu43 Model 9M Used Equipment
__in Service Market
ct 7) 0 $ 40,000
2* 3 $ 120,000
3* 2 $ 80,000
a* 1 $ 40,000
5 1 $ 40,000
6* L $ 40,000
7 20. $ 80,000_” -
ax 5 $ 200,000
TOTAL a i . $ 640,000

(1) Note that company no. 1 operates three model C43 continuous mines ©

but only one machine still uses PCBs as a motor ccolant; and only
qme motor of the three used to cperate the machine cces contain
PC3s - i.e., the other two motors amloy silicone as a coolant.

* Small producer (less
procucticn) .



($2, 288 ,000 t0 $2,380,000/ $30,000 per man year x 1/3 dollar labor cer ;
eollar cést = 25 t 32 man years) would be required in late-1978 and early
1979, Extra labor due to a lack of replacement wits micht increase em
ployment by ($500,000/$30,000 per man year = 17 man years) during the first
few mnths of 1979,

-63-



askarel transformers is about 40 years, Lf certain reutine maintenance is.
performed, _.. cr ;

The electrical preperties of askarel are significantly
degraded by the presence of misture. Thermal cycling of the transformer
during normal use can draw air into the transformer through minor leaks in
bushings, and the askarel will afsorS misture from this air. It is routine
Practice to check the electrical properties of the askarel periodically at
intervals from 1 t 5 years depending on ambient air moisture. If misture
is detected, the askarel is drained and filtered (to remve the misture),
and the bushings are repaired. This maintenance, usually performed in the
field, is necessary to assure continued safe qperatim of the transformer
as severe degradation of the asfarel can cause major arcing within the.
transfommer.

Similar maintenance has been routinely performed on the
several million oil-filled transfommers. ‘he oil in’ many of these mits
may be contamined with PC3s to a concentration of several nuncred parts
per million due to past use of the same equipment to service both oil-filled
and askarel transformers. It is also possible that 2C3 contaminaticn of the
oil may have occurred in the manufacturing.precess where plants: made both
oil-filled and askarel transformers. Disposal of transformer oil has been
throuch comercial waste.cil _haulers,which_has_apparently..further -increased.
levels of PCB contamination of reprocessed and reclaimed oils.

1.2.5 Electromacnets

toes toe sarumenn-Geveral - hutred-etactramagnets “have been manutactured-witir--——
PCB oil as a coolant. These magnets are used as magnetic separators over
coal conveyor belts. Thé magnets are similar in constm:ction to trams=. —_._.
formers. There is no present use of PCs by this industry for either .
manufacturing or maintenance.



year), and could force the clesing of three small firms with a total
oyment of 12 to 15 persons.

Industrial Waste Oil Generators

Those industries whose waste oil contains more than 50 pom Pas
will have to incur disposal costs of $.0832/lb. Even industrial oil con-
taminated with less than 50 poem PCBs may be avoided by waste oil collectors.
This will not be a big problen for coal burners. Fuel oil burning companies
can use a mixture of waste and virgin oil but there are tectmical problems
to be mastered in this use. Continental Forest Industries indicated that up
to 14 percent waste oil mixed with #6 residual oil is feasible. ‘The result
may be the develocment of a separate market for industrial oil with low levels
of PCBs’ for use as fuel. Long term econcmic impacts should not be significant.

13.4 Summary
Compliance Costs

Road Oil - increased costs of virgin or

synthetic material (years 1-5) $100 million/year
Road Oil - increased cost of cbtaining

adequate supplies of segregated used

motor oil (years 6-15) $6.4 million/year
Lost production of re-refined hydraulic :
fluid $ .4 million/year

Employment Effects

Three small re-refiners may close with a loss of 12 to 15 jobs.
Shifts will occur in the collection segment of the industry, but will prehebly
have little net impact on employment. OS

-9l~


“gable 1.5-1

Effect of the Proposed 2CS Beh Pegulations cn Various |

Uses of 23s

Subpart of Proposed
PCB Ban Regulation

Chapter of Report Discussing Impacts

Ban on capacitor
distribution in
commerce

3.

filed ‘trans-

mers
Mining Machines

Electromagnets
10. itydraulic Systems

Users of Askarel

Transformers:
‘Transfomer. Sex

Railroad Locomo-

tive Transformers

!
j

oll FI
foi

4.
5.
6.

hh

ca

Systema

Ll, Heat Transfer
12. Conpressors

13. Reclained O11

facturing

16. Transformer Manu

duct Contaminants
faguuring

14, Unintentional Pro~
1S. Capacitor Manu-

A2 Definitions

(q) PCBs

(Ww) Mixture

(ce) Dest Control Agent
(da) Process

(hh) Totally Mcl. Manner
(id) Waste O11

3 Disposal
(e) (1) (B)
ransfomer oi
ess 300
Marking a
(a) (3) (1)

761.30 Tot. Incl, Manner

(a) Manuf. 6 Use San
except in totally
enciosed manner

x MM

*
cy
x

i]

ord

“

rw

2k 9 He

nM MO

== eRe Ba]

(ce) 71-79 Distrib. ban

761.31 Authorizations

(a) Transformer Servicing

(>) Transformer Distribu-
tion in Commerce

(c) Railroad Transformers

oof f@eeettireingy Machines: scot

(e) Hydraulic Systems
Annex VII - Spit cntzol

> >

>
>
>



$2 to $15 sampling; $5 order processing; $60 analytical services.

Disposal

The incineraticn of oil contaminated with PCBs in the range of 30
to several hundred parts per million would not require any additional fuel,
but the costs of facility amortization, maintenance, operation, ‘and capital
would be the same as for a uit bumming pure PCBs. The cost of incinerating
the oil depends critically on the value of the material as fuel in an incineretor
handling fuel-poar materials such’ as pure PCBs‘or shredded capacitors. Pre-
sent practice is to fuel such incinerators with chemical westes which have a
high fuel value. Present charges for the incineration of PC3 solids mm about
$0.15/1b:, +) which reflects the availability of essentially free fuel. There-
fore, under present conditions, there is little demand for the Pca contaminated .
oil as a fuel for PCS incinerators; and the oil has no economic value as a fuel.
in such units. It is possible that the demand for incineration of capacitors
will increase to such an-extent that the fuel requirements cannot be met-by - ~° -
waste solvents; the contaminated transformer oil may then have same economic
value as a fuel, and.the incineration costs would be expected to decrease to
reflect this value. :

The use of the contaminated oil in any chemical waste incinerator” ~~
other than one which is buming PCBs would result in additional. analytical
costs and record keeping requiremants. Because of the limited number of PC
incinerators that will be in use, it is not. likely that .a cometitive market.
for contaminated oil for use as fuel in PCB incinerators will develep and
the charges for incinerating contaminated’ oil would then be controlled by
the price that could be charged by a special purpose oil incineration uit.
A cost analysis..for. such_a. special. purpose. ineinerxator.is. summarized in: +--+ ~--
Tables 7.3-1 and 7.2-2.. This:unit is ofa -size.equivalent to the incinerator ....
used to evaluate the disposal costs for PCBs and capacitors. resulting from

(1) ENSCO, General Information ENSCO-PCS-001 Rev. 3-78, El Dorado,
Arkansas: Marci, 1976.

-42=



interferences result in false positive indications of the presence of PCRs. ~
The PCB components can only be resolved through complex clean-up procedures
or the use of gas chrematography/mass spectrometry, techniques that would
cost up to several hundred dollars per sample.

Road OQiling

The most recernt data indicates that road oiling consumes 319
million gallons of waste oil per year (Figure 13.0-1). At an application rate
of 1/2 gallon per square yard, this is sufficient to oil 45,000 miles of
readwey 24 feet wide. The proposed ban regulations would forbid the use of
oil containing detectable amounts of PCBs for cust control. Fluids fram trans- '
formers are likely to have detectable amounts and other industrial sources ars
at least scmewnhat suspect. Currently these industrial oils are collected along
with used motor oil. Although virgin motor oil has mo PCBs, used moter oil
may have PC3s gram previous recycling which included industrial oil sources Lo.
among the feedstocks or from old transmission oils which contained PCBs as an - : 7:
adéitive. Nevertheless, used motor oil urmixed with industrial sources is
unlikely to contain as much as 10 pom PC3s, and may have FC3 concentrations
that are undetectable without unusually elaborate and expensive analysis. None
of the reported analyses of waste oil for PCBs was Sased on used moter oil
without -any possibility of industrial contaminaticn. Presumably waste oil
solely from autemotive sources would contain fever PCBs. It is doubtful that
road oiling could stand the costs of even "simple" tests at $70 per sample.
Prospective road oilers therefore would be safer using waste oil if they take
Precautions to ensure that it does not contain industrial oils (and certainly
mo electrical oils).

Compliance with the requirements of the preposed regulations could
be achieved by either of the follewing strategies:

(1) Avoid all waste oil and substitute virgin oil at considerable
monetary and energy ccst where the customer is willing to pay the increased
price. At an average price of $.375 per gallon for #2 fuel oil vs $.03 per
gallon collection costs for used crank case oil, the cost of road oiling
would increase (.375 - .08) x 139 million gallons = $94 millicn per year.



maximm total cost of $100,000. If proforma plans were prepared under the ©
sponsorship of 2 trace association or made available by a major manufacturer,
the only costs to a stall operator would be one day of Services froma“
registered professional engineer to adapt, review, and approve the plans. The
cost of this service should run about $250, reducing the total cests to. a
range of $25,000 t $100,000 for spill control plans.

5.2 Summary

Lost wages (temporary
structural unemployment)

Spill prevention and

Annual Costs (1979)

$0 to $2,345,000

$25,000 to $100,000

Total Cost

-$0 to $2,345,000

$25,000 to $100,000 .

control plans

Total $25,000 to $2,500,000"

$25,000 t> $2,500,000 —



A number of minor effects on the balance of trade may be
anticipated. The ban on the importation of PCB capacitors in foreign made.
electrical equipment might decrease the availability or slightly increase ~
the price of imported appliances. The restriction on the PCB contamination
of diarylide yellow pigments might end the importation of this material.
However, the ban on recycling contaminated transformer oil would be expected
to result in an increased denand for new oil, and the ban on the rebuilding .
of transformers will increase the mmber of new transformers being manufactured
resulting in an increased demand for bauxite to make the alumimm wire used
in their construction. Sufficient data is not available to support a quantita-
tive analysis of these effects, and the total impact on the balance of trade
is not expected to be significant.

No significant impacts on supplies of strategic materials were
identified in the course of this study. ce

-125-



‘1.2:6 Capacitors _ eo ae eS
| PCBs have been used as the Liquid dielectric in almost all

aC (alternating current) capacitors made in the United States since the mic- .

1930's. PCBs are mexcelled in their procerties of chemical stability, : -7

fire resistance, and high dielectric strength. Although no other dielec-

tric liquids equivalent in performance to PCBs have been develcped, other

liquids are being used successfully in capacitors which perform the same

function as C3 capacitors. All of the manufacturers of. large power factor

capacitors have switched to non-FCS substitutes. Most of the manufacturers

of small capacitors have either stopped using PCBs or annownosd theiz in- : ~

tention te switch to other Liquids early in 1978. : os

1.3 PCB Restricticns in the Toxic Substances Control Act

Prior to the enactment of the Toxic Substances Control Act, the
only authority of the EPA with respect to PC&s dealt with discharge of con-
taminated water from indust=ial point scurces. February 2, 1977, the
EPA promulgated regulations under Section 307(a) of the Federal Water- ee
Pollution Control Act which banned the direct discharge of water contami~ .
nated with PCas by electrical trensformer ané capacitor manufacturers after :
February 1, 1978, @)

The enactrent of the Toxic Substances Control Act (in Cctcber,
1976) placed additional requirements on the use of PCBs and required that
certain actions betaken_by the EPA,Section 6(e).(1). of.the Act required .
that the EPA promigate maricing amindispesal sagubettons for: Peasss-Tiese ere
regulations were promilgated on February 17-1978. @)--the regulations re
quire that special waming labels_be-applied to .2C3_equipment,_containers,——....——..

(1) EPA "Final Decision" Federal Register, Feb. 2, 1977, op. 6531-6555.

(2) EPA, “Polychlorinated Biphenyls (PCBS): Disposal and Marking,"
Federal Pegister, February 17, 1978, pp. 7149-7164.



still in service. ‘Two of these machines presently use siliccne-cooled motors
while the third machine.has only one ?C3 motor remaining - i.e., two of the
three motors are silicore-ccoled.

Fifty-four of the fifty-seven mdel $C4 continwus miners buils : |
by Joy Manufacturing have been located in the course of this investigaticn. :
Thirty-five of these located are idle (standby service or stored as 2 source
of spare parts), thirteen are being used to mine coal, three are in uses
other than cecal production (e.g., cutting overcasts and clearing air courses),
two are used as spare equipment, and one is being used in a training srocram
at a vocational school. ‘Two of the three model 9C1 continucus miners that

have not been accounted for were reportedly sold. Therefore, it is estimated a |
that a total of approximately ficteen units are still in service.

The 73 loaders were sold to eighty-eight different mining opera-
tions, the majority of them small coal mines. ‘Sixty of these mines ise”
three or fewer loaders and, based on a survey of thirty-six mines, it is esti-
mated that nearly all of these leaders are stiil in service. .

The motors in loaders generally require rebuilding every 18 to 24.
menths,. the time to failure depending upen crerating conditions. ‘The motors
“used in continuous miners usually require rebuilding every 12 weeks becatise
continuous miners are operated under relatively severe cenditicns. Rebuiid-
ing, from the tim the motor is removed from service wmtil the machine is
returned to service, usually remuires one 9 two weeks.

Both the continuous miners and the loaders are used in uncergroumd
mines. Joy Manufacturing reported that a few.of the machines. were originally... ..
sold for use in potash mines, but all of the mines that were identified in
the course of this survey. were coal mines. The continuous miners ¢ccuge
the coal off the face of the seam and continuously load it onto shuttle
cars which haul it to a conveyor. After the miner has driven into the seam
about twenty feet, it is moved to a nearby section while the roof that it



-?ZT-

Ttem (Chapter)

Electranagnets (9)
Replacement Cost:
Increased Labor Costa

lylraulic Systems (10)

Die Casting Machines
Analysis and Sampling
Reporting
Spill Prevention Plans
Decontamination

Other ityicaulic Systens
Decontamination .
Production Interruptions

leat ‘transfer systews (11)
Qupressora (12)
Reclaim OL) (13)
Increased tost of Synthetic Road
OW Haterdal
Increased Cost of Nout OLL

Jost Production of Reclaimed
Malraulic Fluld

Phthalocyanine Plgnenta (14)
Process Changes

able 17.1-1 (Con't)
Transitional Cost Impacts

$ MII fon Per Year

Estimated
Succeed ing $ Million Reliability
1979 Years Total of dota
“$35 o $2.5 £208
5 o 5 1008 49008
8 a) 8 £500 :
2 0 12 +508
5 0 5 : 2400 :
Ls) 7.3 (1980) 14.6 300 42008
1.6 0 3.6 -308 +1008
as o “ aa
°
os 0. ae ay)
2 o 2 50% +2008
100 100 (years 2-5}4444 500 808 1108
6.4 (yeara 6-15) gases B08 42008
A -4 (1980) -8 2208
__35 0 5 500 +2008
9268.3 mbtlida $1,802 ml14on 608 4408

**pata not available to support estimate, potentially lat cost. inpact.

***Qosts to contime indefinitely until waste: Imiustrial, o}

*s¢*typer bond estimate. Decreased danand my result in significantly coducel impacts,

1 no Yonyex containa measurable amounts of PCBs.



Sales of C3 industrial capacitors in 1976 are estimated to have
been approximately $51.7 million. Assuming relatively-constant cutput and.
demand, a fifteen to twenty percent price increase for comparable non-?CB
industrial capacitors will result in sales of from $59.5 to $62.0 million
(using constant dollars). This suggests that users of industrial capacitors
will pay approximately $7.8 to $10.3 millicn more for non-PC3 units.

Manufacturers of electrical emripment which will use non-?C3
industrial capacitors may face various redesign problems. For example, manu-
facturers of miniature electrical equipment, who soecialize in optimizing
space in the construction of their products, may find that the production of
a new, larger capacitor makes the continuation of their miniaturized oreduct
line uncertain. Apart from the market for miniature equinment,. mst
electrical equipment can be redesigned to. accamedate the, scmewhat larger
non-PC3 capacitors at relatively little cost. .

Capacitors represent a very emall fraction of the total production
(i.e., input) cost of a given appliance. Any price increases in final prod-
ucts due to employing non-2C3 capacitors will be imperceptable tc consumers -
i.e., the increase in price per unit will be so small that the cercentace
change in quantity demanded will be very close to zero. It is expected that
sales of electrical appliances will not be affected appreciably nor will
there be any dramatic effects on employment in the capacitor production in-
dustry nor in the electrical appliance manufacturing industry.

Users of non-PC3 industrial capacitors may face greater risks of
fire as they switch to such units. Insurance rates will increase to reflect
any increased fire losses, but only after a time lag sufficient for new
risks to be incorporated into the experience record.

Any decrease in the expected service Life of industrial capacitors
will have a disproportionate effect on econcmic impacts due to the proposed
regulations. it is estimated that fewer than two percent of all small
capacitors fail before the equipment is scranped due to cbsolescence. The

-106-



15.4 Summary
Transitional Costs:
Redesign of equinment to accomedate
larger capacitors
Long Term Costs: ©

Power factor capacitors
Price increase for nen-PC3 capacitors

Industrial capacitors:
‘Price increase for non-FC3 capacitors

$5.5 to 10.9 millicn
per vear ;

$7.8. to-10.3 million

per year
Increased fire risk *.
Decreased service life *
Enoloument 3ffeets: Not expected to be significant

*Insufticient data available to support estimate of impact.

-108-



13.0

14.0

__ TABLE. OF CONTENTS: (Cont'd.) ~

10.1 Requirements of the Proposed Regulaticns.

10.2 Omersfiip and Usé of Contaminated
Rydraulic Systems 2. 1 we ee ee ee

10.3 Compliance Costs... . eee ee

- 10.4 Summary . 1 ec ce ee ee ee

BEAT TRANSFER SYSTEMS 2. 2 we ee ee ee

11.1. Requirements of the Propesed Regulations. ;

11.2 Ownership and Use of Contaminated
Beat Transfer Systems... 2 + eee ee

11.3 Compliance Costs 6.1 ee ee
11.4 Sumery . ee ee ee
COMPRESSOFS 2 2 2 ee eee et ee ee es
12,1 Requirements of the Proposed Regulaticns.
12.2 ‘Compliance Costs . 11 eee ee eee ee
12.3 Summary. 2. ee ee

13.1 Requirements of the Prerosed Regulations ....

13.2 Sources and Amumts of Contaminated Waste

13.3 Compliance Costs fe eee eet
13.4 Summary 2 ww ee ee

PCBs AS UNDNIENTIONAL PRODUCT CONTAMINANTS. . .
14.1 Requirements of the Proposed Regulations.
14.2 Compliance Costs 2... ce ee eee
14,30 Summary . ww ce ee ee ee tee ns

64
64



Monsanto manufactured almost.all the PCR-based hydraulic fluids.

When Monsanto discontinued mamifacturing PCB-based hydraulic fluids in 1971,
they did not recommend draining or flushing of hydraulic systems but that
replacement fluids should be added to the remaining PCB fluids in the system.
As a result, hydraulic systems which used PC3s in 1972 and prior. years now
contain replacement fluids contaminated with .006 to 50% PCBs as discussed

‘in Chapter 10. The total amount of contamination is a function of the system
leakage and dilution during the past five years.

A portion of the available used industrial hydraulic oil is refined
and sold for reuse as hydraulic oil. ‘This specialized reclaiming service is
furnished by the following four companies which reclaim a total cf about
150,000 gallons of hydraulic fluid per year. :

E. F. Houghton and Co., Philadelphia, Pennsylvania. -

Radco Corporation, LaFox, Illinois :

Findett, Inc., St. Charles, Missouri

Wallover Corp., Zast Liverpool; Ohio

Automobile and Industrial Lubricating Ov The amount of used oil
collected for reuse in 1970-71 was about 9C0 million ¢callons per ‘year, with
an additional 600 million gallons used internally for fuel or dust control
on roads. (2) Thus, about 60 percent of the amount of new oil sold was reused.
Major uses of this oil were as fuel (1028 million gallons), read oil (319
million gallons), and feedstock for re-refined lubricating oil (138 million
gallons).

The extent of PCB contamination of this cil was studied on a

limited basis by the EPA National Enforcenent Investigation Center (NEIC) in’
Denver. (2) Samples of oil were taken from selected tank truck lots of used
oil that had been collected in Virginia, Maryland, and North Carolina. This

oil had been delivered to Continental Forest Incustries in Hopewell, Virginia,

Ti) Weinstein, N.J. (Recon Systems, Inc.), Waste Oil Recycling ard Diszosal,
EPA-670/2-74-052, Princeton, N.J.: August, 1974.

(2) Magruder, Robert S. (Continental Forest Industries), testimony presented
at the US EPA informal hearings on the PC3 ban regulations, Washington,
D.c., July 15, 1977.

~85-



possible to install a cartridge filter containing activated carbon in the
liquid circulation piping. “The filter would continually scavenge residual PC3s
fem the silicone after mst of the PCRs had already been replaced when the |
transfomer was retrofilled. This procedure might assure that the concentra-
ticn of PCBs in the silicone would not increase © corcentrations above the
1000 pom required by the proposed regulation.

The decontamination of silicone transformer liquids is still in
the experimental testing stage. Westinghouse Electric Corporation has re-
portedly applied for a patent on the orocess of using activated carbon to
remove PCBs frum silicone. No results have een made gublic on techniques ~
to remove PCBs from hydrocarbon transformer liquids, although RE Corporation
is reportedly doing research in this area.

6.4 Cost Impacts of the Proposed Regulations .

It is not known at this time whether the liquid used to replace
the CBs will be silicone or a high fire point hydrocarbon, liquid. However,
silicone has been extensively tested and is the mst expensive of the alter-
natives; accordingly, costs based on the use of silicone provide an upper
bound estimate of the costs of retrofilling.

Silicone liquid prices range from $11.00 to $14.50 per gallon. Req
cent charges for field retrofilling of transformers nave min from $20 to $40 ,
ger installed gallon, including disposal of the PCBs and contaminated flushing
———~“Liouidt and-anatysis~ot the-retrofitted-ticuid- for-PCas:— Since the -retrofiiling—
of locemotive transformers will be done only in a few well-equipped shops, the
installed costs should not exceed $20 per gallon of silicone.

Depending*cri" the spectiie design and use, “the average service tife—~
of railread transfommers~is fram four-to 30-vears.” Failed t=ansfcrmers dre
... presently rebuilt by..the-manutactuner.for.approximately..25% of. the.cest of. .si- vs
a new transformer. Rebuilding-requires aporoximately 4-6 weeks while de- °

liveries of new replacement transformers require 12 to 18 months.

-30-



TT

16.5 Compliance Costs

Clean-up Costs. ;

The only costs incurred by transformer manufacturers due i--) ‘the
ban on the use of FC8s will be clean up and disposal costs incurred in flushing -
PCBs from storage and material hardling equipment prior to using this equip-
ment to store high fire point liquids. This equipment consists primarily of
storage tanks, filters, pumps, ami piping. Clean up costs, including disposal
of contaminated solvents, should not exceed $10,000 per plant, or a total one
time cost impact of perhaps $100,000 in 1977 and 1978. ,

Cost of Substitutes

The "high fire point liquid cooled transformers’ ard air cooled
transformers will cost about the same to 10% more than askarel units depending
on the acceptability of hydrocarbon base high fire point transformer liquids.
Based on past sales of 5000 askarel wits per year at an average price of .

~ $20,000, a 10% cost increase would increase to sales and costs to the users by
(5000 x $20,000 x LO% = $10,000,000 per year). There should be mo effect on
total demand for transformers for new applications. ‘The ban on rebuilding askarel
transformers may increase the demand for new transformers by 1000 to 2900 units
per year. This additional demand should be easily supplied as the transformer
mamufacturing industry as it has recently been operating at only about 60% of”
capacity.

Market structure should not be significantly affected as all of
the former manufacturers of askarel transformers will have equal access to
the ‘high fire point transformer liquid' materials and technology. Access
this market segment will open to those transformer manufacturers who did not
offer askarel as an alternative to oil. This will orimarily afford a marketing
opportunity to RIE Corporation which has never supplied askarel units but which
has a strong market position in the hich fire point liquid transformer market
segment. ‘he increased sales by RTE will probably be less than the total
increase in transformer sales, so this small shift in market structure should
not result in a net decrease in the sales by any of the other manufacturers.

-17-,



14.0 PCRS AS UNINTENTIONAL PRODUCT CONTAMINANTS

Although most of the PC3s in use were produced by Monsanto as the primary
product of a reaction process, other chemical reactions can produce PCBs as by-
products, resulting in contamination of commercial chemicals. Similarly, contam-
ination of existing material may result in PCB contamination of ‘products made
by recycling these materials. Recycled paper is known to be contaminated with
PCBs at low levels, but a detailed study of this industry indicated that it would
not be affected by the 50 pom Limit on C3 cmtamination.‘!) poiychiorinated
terphenyls have also been reported to be contaminated with PCBs formed as a side |
veaction during manufacturing, (2) but the sole U.S. distributor of this material |
has reportedly assured its major custamer that it would warrant that future
shipments will contain less than 50 ppm pea. (9)

The only chemicals known to be contaminated with PCBs in concentrations
exceeding 50 pom are certain phthalocyanine blue and green pigments and the _
diarylice yellew pigments. OF - :

14.1 Requirements of the Proposed Fegulations

The regulations ban the contimed manufacture of PCBs after
December 31, 1978. This ban also applies to mixtures containing more than
50 com PCBs regardless of whether the PCBs were adced intentionally or formed.
Goring manufacture as an uintsenticnal by products.

14.2 Compliance Costs

Phthalocvanine Pigments

Phthalocyanine picments are major sources of heat- and light-
stable blue and green colors in the plastics and printing inks industries. In
the manufacture of copper shthalocyenine blue pigment (phthalo blue), the

(i) Versar inc., Involvement of PCBs in the Pulp and Paper Industry, EPA
560/6-77-005, February 25, .
(2) Versar Inc., Assessment of the Environmental and Economic Impacts of the

Ban on Imports of PCSs, EPA 560/6— 7 Feoruary 22, 1977.
(3) Betsonal cammmication, L.M. Argueso (M. Argueso and Co., Marnaroneck, N.Y.),
August 30, 1977.

-92-



The proposed regulation authorizes continued use of the retrofilled
transformers for only five years from the effective date of the registraticn. ~-
It is assumed that a review of the environmental impact of losses from the
retrofilled units will result in this authorization being extended indetinitely.

6.5 Economic Impacts of the Proposed Reculations

The recuired retrofill and processing program should cost less than -
20% of a comparable program to replace all of the transformers within the next
several years, and the retrofill program should avoid any significant dis-
ruptions of railroad service on the Northeast Corridor. :

All of the affected cwmers of PC3 railrcad transformers are sovern-
mental or semi-govermmental corporations which are mmning operating deficits
as summarized in Table 6.5-1. These deficits, of over $800 million per year,.
are presently being covered by subsidies from tax revenues. :

The retrofill and orecessing program is not expected to result in
significant service disruptions, and no effect on railroad overating exploy-
ment is anticipated. The retrofill and processing programs are expected to
generate a considerable demand for labor. Calculated total labor and overhead
costs are summarized in Table 6 +$-2.—This woukd-be thre equivatent bore tés7mm ~~
years of emplcyment, assuming a burdened labor rate of $30, 00 per man year. :
Additional employment would result from the increased production of the siliccne -
liquid and activated. carbon and. increased distosal incineration services.

676 —Semmer

Cost Impacts:

"Cost of ‘YeeOELLI“Brogran $7, 045,000 T1979 :
-- Cost of precessing-progrem——- 5460-;60e—-- I9g0-19e2--
Reporting 5,000 1979

297000 BOG mee ee oe
$12,528,000

vamos oo -- “Spa dde preventiomplans———--

-33-