From: Stevens, William

To: Kordzi, Joe

Cc: Stevens, William

Subject: FW: Question on SDA IPM cost algorithm

Date: Thursday, August 13, 2015 3:38:04 PM

Attachments: FGD S&L White Bluff.pdf

FGD Sargent & Lundy Dry FGD 9-02.pdf

Joe –

As a basis for estimating the capital and O&M costs for retrofit spray dry FGD technology in our IPM

 modeling, EPA uses the Sargent & Lundy (S&L) “SDA FGD Cost Development Methodology,”

 prepared for EPA and available at

http://www.epa.gov/airmarkets/documents/ipm/attachment5_2.pdf .

I was the EPA reviewer for the S&L work, as noted beneath the Legal Notice in the document.

Regarding your question as to whether the costs given by this methodology include a fabric filter: It

 has always been my understanding that a fabric filter is included in the scope and cost of the SDA as

 modelled by S&L. The question came up a few years ago as well, and I recall then confirming

 verbally with S&L that a fabric filter is indeed included. I note and agree with the observations of

 your consultant, Dr. Fox, who came to that same conclusion. 

Regards -

Bill

William Stevens

Senior Advisor - Power Technologies

Office of Atmospheric Programs

Clean Air Markets Division

U.S. Environmental Protection Agency

stevens.william@epa.gov

202-343-9642

From: Kordzi, Joe 

Sent: Monday, August 10, 2015 2:54 PM

To: Stevens, William

Subject: Question on SDA IPM cost algorithm

Hi Bill,

Your reply to this email will go in our final docket for this action.

We received some comments critical of our SDA cost estimates for the Tolk facility. Tolk sells their

 fly ash and they have stated that if they install an SDA upstream of their existing baghouse, it will

 contaminate their fly ash and make it unsalable, requiring a $2M addition to their annual operating

 cost. They also stated they would have to build a landfill to dispose of it. If instead they install the

 SDA downstream of their existing baghouse, they are claiming they would have to install an
 additional tail-end baghouse to capture the spent reagent (the ash would be captured in the

 existing baghouse and could still be sold). When they met with us, I told them I thought the IPM

 SDA module did include a baghouse but they are claiming that is incorrect. Would you please

 confirm which is true?

Some observations from Dr. Fox, who we have hired to help us in addressing some of the comments

 we have received:

Referring to the S&L SDA IPM report:

p. 1, 2nd parag. says: "The curve fit was set to represent...a "typical" SDA FGD retrofit for removal of

 95% of the inlet sulfur." A substantial amount of the SO2 removal achieved by an SDA occurs in the

 tail end baghouse because the ash is rich in lime. Without the tail-end baghouse, the SDA would

 only achieve about 75% SO2 control. As the IPM algorithms are based on 95% SO2 control, I am

 almost certain the costs include a tail-end baghouse. See discussion of this latter point in the S&L

 White Bluff cost report [Bill I’ve attached it], pp. 2-2 and 2-9, attached.

p. 4, third bullet says: "The fixed maintenance materials and labor (includes bag replacement) is a

 direct function of the process capital cost..." I always understood this to mean that the costs

 estimated by the CDS module include a tail end baghouse. Why else include bag replacement

 costs? Further, based on the magnitude of "balance of plant costs" in the IPM SDA model, I've

 always assumed the baghouse was included there. In my experience, a tail end baghouse is

 commonly included in an SDA cost estimate. See the previously attached S&L reports prepared for

 the National Lime Association [Bill, I’ve attached it]. In them, you will see SDA costs broken out,

 rather than lumped together like in the IPM model. By studying these broken out costs, it seems

 pretty clear to me that the IPM SDA module indeed includes tail end baghouse costs, most likely in

 the category called "balance of plant costs". See also the S&L detailed cost estimates for Big Sandy

 Unit 2 and White Bluff, which also break out the costs.

Joe Kordzi

EPA Region 6

" . . . and miles to go before I sleep."

 - Robert Frost