MEMORANDUM

Date: November 7, 2011

Subject: Draft Cost Impacts of the Revised NESHAP for 7 Source Categories

From: Lesley Stobert, EC/R Incorporated

To: Paula Hirtz, EPA/OAQPS/SPPD

Nick Parsons, EPA/OAQPS/SPPD

______________________________________________________________________________

The purpose of this memorandum is to present the estimated cost impacts of proposed 

requirements for pressure relief device (PRD) monitors for the seven source categories that are 

subject to the Pesticide Active Ingredient (PAI), Polyether Polyols (PEPO), and Group IV 

Polymers and Resins Production National Emissions Standards for Hazardous Air Pollutants 

(NESHAP) – 40 CRF 63, subparts MMM, PPP, and JJJ, respectively. These source categories 

are Pesticide Active Ingredient Production, Polyether Polyols Production, Acrylic-ButadieneStyrene (ABS) Production, Methyl Methacrylate-Butadiene-Styrene (MBS) Production, 

Polyethylene Terephthalate (PET) Production, Polystyrene Production, and Styrene-Acrylonitrile 

(SAN) Production. The addition of PRD monitors to the NESHAP for these source categories is

being proposed along with proposed changes evaluated under EPA’s Risk and Technology 

Review (RTR) program, which is addressing statutory requirements under section 112(d)(6) and 

112(f)(2) of the Clean Air Act. Section 1 provides background information, followed by the 

estimated costs of the impacts of the PRD monitors for each source category in section 2.

1. BACKGROUND

Section 112 of the Clean Air Act (CAA) establishes a comprehensive regulatory process 

to address emissions of hazardous air pollutants (HAP) from stationary sources. In accordance 

with CAA section 112(c), EPA identifies categories and subcategories of major sources that emit 

one or more of the HAP listed in CAA section 112(b). CAA section 112(d)(2) then calls for 

EPA to promulgate national technology-based emission standards for each listed category or 

subcategory of sources. For “major sources” that emit or have the potential to emit any single 

HAP at a rate of 10 tons or more per year or any combination of HAP at a rate of 25 tons or more 

per year, these technology-based standards must reflect the maximum reductions of HAP 

achievable (after considering cost, energy requirements, and non-air health and environmental 

impacts) and are commonly referred to as maximum achievable control technology (MACT) 

standards. Section 112(d)(6) then requires EPA to review the CAA section 112(d) technologybased standards and to revise them “as necessary, taking into account developments in practices, 

processes, and control technologies,” no less frequently than every 8 years. The residual risk 

review is described in section 112(f) of the CAA. CAA section 112(f)(2) requires EPA to 

promulgate standards for each category or subcategory of CAA section 112(d) sources “if 

promulgation of such standards is required in order to provide an ample margin of safety to 
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protect public health . . . or to prevent, taking into consideration costs, energy, safety, and other 

relevant factors, an adverse environmental effect.

In addition to the residual risk and technology reviews performed regarding the 

NESHAP, EPA also reviews the existing provisions of the NESHAP during the RTR process. In 

2008, the United States Court of Appeals for the District of Columbia Circuit vacated portions of 

two provisions in the EPA’s CAA Section 112 regulations governing the emissions of HAP 

during periods of SSM. Sierra Club v. EPA, 551 F.3d 1019 (D.C. Cir. 2008), cert. denied, 130 S. 

Ct. 1735 (U.S. 2010). Specifically, the Court vacated the SSM exemption contained in 40 CFR 

63.6(f)(1) and 40 CFR 63.6(h)(1), that are part of a regulation, commonly referred to as the 

“General Provisions Rule,” that the EPA promulgated under section 112 of the CAA. When 

incorporated into CAA Section 112(d) regulations for specific source categories, these two 

provisions exempt sources from the requirement to comply with the otherwise applicable CAA 

section 112(d) emission standard during periods of SSM. In light of and consistent with Sierra 

Club v. EPA, the EPA is proposing to eliminate the SSM exemption in the PAI, PEPO and 

Group IV Polymers and Resins NESHAP and require that the standards in these rule would 

apply at all times.

As part of the proposed elimination of the SSM exemption in these NESHAP, EPA is 

proposing that there be no discharge to the atmosphere from any PRD on any equipment in HAP 

service within the process units for these seven source categories. To ensure compliance with 

this requirement, facility owners or operators would be required to install and operate electronic 

indicators on each PRD that would be able to identify and record the time and duration of each 

pressure release and notify operators that a pressure release has occurred. These provisions are 

proposed due to concerns that a large number of PRD releases may emit large quantities of HAP, 

may not be identified and controlled in a timely manner and may be due to repeat problems that 

have not been corrected. The proposed provisions clarify that such release events would be 

violations of the emissions standards of these rules; however, for pressure release events that 

occur related to a process or control device malfunction, the owner or operator could claim an 

affirmative defense through other proposed NESHAP provisions.

2. IMPACTS OF RISK REDUCTION OPTIONS

In the evaluation of NESHAP options for Polyvinyl Chloride and Copolymers 

Production, the EPA estimated the costs of requiring PRD monitoring systems.

1 As polyvinyl 

chloride and copolymers (PVC) are produced at chemical production facilities of similar size and 

with similar equipment type characteristics as facilities that produce PAI, PEPO and Group IV 

Polymers and Resins, the capital and annual costs of PRD monitors at PVC facilities were 

applied to these source categories to obtain estimated cost impacts. 

In the development of the PVC NESHAP, the estimated cost of a PRD monitoring system 

was $188,913 and annual costs of operating and maintaining the monitoring system were

 

1 National Emission Standards for Hazardous Air Pollutants for Polyvinyl Chloride and Copolymers Production: 

Proposed Rule. 76 FR 29528. May 20, 2011.
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estimated to be $26,897 per facility.

2

 These costs were based an estimated average facility, 

which was assumed to have 134 PRD. In addition, it was estimated that approximately 12.5 

hours of labor would be expended by facility personnel to meet the NESHAP reporting and 

recordkeeping requirements related to PRDs. 

To estimate the PRD monitoring system costs for the PAI, PEPO, and Group IV 

Polymers and Resins source categories, we applied the same estimates used in the PVC 

NESHAP analysis. These assumptions include the same PRD count, monitoring system initial 

and operation and maintenance costs, and the same labor hours needed to meet the NESHAP 

reporting and recordkeeping requirements. However, slightly different industry labor rates were 

applied compared with those used in the PVC analysis. The PAI, PEPO and Group IV Polymers 

and Resins source category labor costs associated with PRD monitoring NESHAP reporting and 

recordkeeping cost were based on the following labor rates3:

Technical $51.62 ($24.58 + 110%)

Managerial $104.92 ($49.96 + 110%)

Clerical $41.66 ($19.84 + 110%)

Table 1 shows the estimated costs of the PRD monitoring system requirements proposed 

for the PAI, PEPO, and Group IV Polymers and Resins source categories.

 

2

“Costs and Emission Reductions of the Proposed Standards for the Polyvinyl Chloride and Copolymers (PVC) 

Production Source Category.” Memorandum from Eastern Research Group, Inc. to Jodi Howard, U.S. 

Environmental Protection Agency. April 13, 2011. (Docket item no. EPA-HQ-OAR-2002-0037-1002).

3 Labor rates and associated costs are based on data from the United States Department of Labor, Bureau of Labor 

Statistics (BLS) from July 2010. Wages for technical labor are from the category "chemical plant and system 

operators"; wages for management labor are from the category "general and operations managers”; and wages for 

clerical labor are from the category “secretaries and administrative assistants”. These rates represent salaries plus 

fringe benefits. The wages provided above were increased by a rate of 110 percent to account for overhead.
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Table 1. Estimated Costs of PRD Monitoring Systems for the PAI, PEPO, and Group IV Polymers and Resins Source Categories

Source Category

Number of 

Facilities in 

Source 

Category

PRD 

Monitoring 

System Cost 

per Facility

Annual PRD 

Operation and 

Maintenance 

Costs per 

Facility

Annual Recordkeeping and 

Reporting Labor Hours/Costs per 

Facility

Total Capital 

PRD Costs per 

Source 

Category

Total 

Annual 

PRD 

Costs 

per 

Source 

Category

Total PRD 

Source 

Category 

Costs

Technical Managerial Clerical

Pesticide Active 

Ingredient (PAI) 

Production

17 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $3,211,521 $468,673 $3,680,194

Polyether Polyols 

(PEPO) Production*

23 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $4,344,999 $634,087 $4,979,086

AcrylicButadieneStyrene (ABS) 

Production 

5 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $944,565 $137,845 $1,082,410

StyreneAcrylonitrile 

(SAN) 

Production

2 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $377,826 $55,138 $432,964

Methyl 

MethacrylateButadieneStyrene (MBS) 

Production

2 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $377,826 $55,138 $432,964

Polyethylene 

Terephthalate 

(PET) Production

15 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $2,833,695 $413,535 $3,247,230

Polystyrene 

Production 11 $188,913 $26,897 11/$568 0.55/$58 1.1/$46 $2,078,043 $303,259 $2,381,302

* The estimates for this source category are based on 23 operating facilities in the source category. Earlier estimates of the number of operating facilities and costs 

associated with any additional requirements had been 25 or more before EPA learned of some facility closures.