E

C

/R Incorporated Providing Environmental Technical Support Since 1989

501 Eastowne Drive, Suite 250  Chapel Hill, North Carolina 27514

Telephone: (919)484-0222  Fax: (919) 484-0122

 

MEMORANDUM

DATE: June 29, 2010

SUBJECT: Control Costs for Existing Stationary SI RICE

FROM: Bradley Nelson, EC/R, Inc.

TO: Melanie King, EPA OAQPS/SPPD/ESG

1.0 PURPOSE

The purpose of this memorandum is to present information on the costs of control 

technology options for reducing hazardous air pollutants (HAP) emissions from existing 

stationary spark ignition (SI) reciprocating internal combustion engines (RICE). The 

memorandum will look at the cost of retrofitting control technology on existing engines. This 

information will be used to determine national impacts associated with the final rule.

2.0 INTRODUCTION

EPA has determined that oxidation catalysts for two-stroke lean burn (2SLB) and fourstroke lean burn (4SLB) engines, and non-selective catalytic reduction (NSCR) for four-stroke 

rich burn (4SRB) engines are applicable controls for HAP reduction from existing stationary SI 

RICE. To determine the capital and annual costs for these control technologies, equipment cost 

information was obtained from industry groups1and vendors and manufacturers of SI engine 

control technology. In some cases, the industry groups provided a breakdown of the capital and 

annual cost components for each of the retrofit options. Using this cost data, annualized cost and 

capital cost equations for oxidation catalysts and NSCR were developed. 

 

1 Reciprocating Internal Combustion Engine National Emission Standards for Hazardous Air Pollutants (RICE 

NESHAP) Proposed Revisions – Emission Control Costs Analysis Background for “Above the Floor” Emission 

Controls for Natural Gas-Fired RICE, Innovative Environmental Solutions Inc., October 2009. (EPA-HQ-OAR2008-0708-0279) .
2

3.0 CONTROL COST METHODOLOGY 

The following sections describe the methodology used to derive the total capital and total 

annual costs for each of the control technology options. These methodologies were used to 

calculate total capital and total annual costs when only purchased equipment costs were available 

(e.g., vendor equipment costs). The methodologies were not used for cost data provided by 

industry groups because they included a breakdown of the actual total capital and total annual 

costs. A summary of the methodologies, equations, and assumptions used to estimate the total 

capital and total annual costs for some of the costs data are described in the following sections.

3.1 Total Capital Costs

The total capital cost includes the direct and indirect costs of purchasing and installing 

the control equipment. The direct cost includes the cost of purchasing the equipment and 

instrumentation, cost of shipping, and the cost of installing the control equipment. The indirect 

cost includes the costs for engineering, contractor fees, testing costs, and also includes costs for 

contingencies, such as additional modifications, or delays in startup. The total capital cost 

equation can be summarized as follows:

Total Capital Cost (TCC) = Direct Costs (DC) + Indirect Costs (IC)

The direct costs include the costs of purchasing and installing the control equipment and can be 

summarized using the following equation;

DC = Purchased Equipment Cost (PEC) + Direct Installation Costs (DIC).

A summary of the cost assumptions for PEC includes the following:

- Control Device and Auxiliary Equipment (EC);

- Instrumentation (10% of EC);

- Sales Tax (3% of EC);

- Freight (5% of EC);

and can be summarized as:

PEC = 118% EC.

A summary of the cost assumptions for DIC includes the following:

- Foundations and Supports (8% of PEC);

- Handling and Erection (14% of PEC);

- Electrical (4% of PEC);

- Piping (2% of PEC);

- Insulation for Ductwork (1% of PEC);
3

- Painting (1% of PEC);

and can be summarized as:

DIC = 30% PEC = 0.3 PEC.

Therefore, the direct costs can be simplified using the following equation:

DC = PEC + 0.3 PEC = 1.3 PEC.

The indirect costs include the costs of engineering and contractor fees and contingencies and can 

be summarized using the following equation:

IC = Indirect Installation Costs (ICC) + Contingencies (C).

A summary of the cost assumptions for ICC includes the following:

- Engineering (10% of PEC);

- Construction and Field Expenses (5% of PEC);

- Contractor Fees (10% of PEC);

- Startup (2% of PEC);

- Performance Test (1% of PEC);

and can be summarized as:

IIC = 28% PEC = 0.28 PEC.

A summary of the cost assumptions for C includes the following:

- Equipment Redesign and Modifications;

- Cost Escalations;

- Delays in Startup;

and is assumed to be:

C = 3% PEC = 0.03 PEC.

Therefore, the IC can be summarized using the following equation:

IC = 0.28 PEC + 0.03 PEC = 0.31 PEC,

and the simplified TCC equation can be expressed as:

TCC = 1.3 PEC + 0.31 PEC = 1.61 PEC = 1.61 (1.18 EC) = 1.9 EC
4

3.2 Total Annual Costs

The total annual cost includes the direct and indirect annual costs of operating and 

maintaining the control equipment. The direct annual cost includes the cost of the utilities, 

operating labor, and control device cleaning and maintenance. The indirect annual cost includes 

the overhead costs such as spare parts for the control equipment, administrative charges, and the 

capital recovery of the control technology. The total annual cost equation can be summarized as 

follows:

Total Annual Cost (TAC) = Direct Annual Costs (DAC) + Indirect Annual Costs (IAC).

The DAC includes the following parameters:

- Utilities;

- Operating Labor;

- Maintenance;

- Annual Compliance Test;

- Catalyst Cleaning;

- Catalyst Replacement;

- Catalyst Disposal.

The IAC includes the following parameters:

- Overhead;

- Fuel Penalty;

- Property Tax;

- Insurance;

- Administrative Charges;

- Capital Recovery = {I(1+I)n/((1+I)n-1)*TCC} where I is the interest rate, and n is the 

equipment life.

To calculate DAC, the costs were broken up into three separate costs: operation and 

maintenance materials cost, operation and maintenance labor cost, and the cost for annual 

performance testing or downtime or allowance for catalyst washing. Actual annual cost data 

from the industry groups were used to estimate the DAC for each of the control technologies. 

The IAC was broken up into three separate costs: administrative, fuel penalty, and capital 

recovery. Again, cost data from the industry groups was used to estimate these costs for each of 

the control technologies. No fuel penalty was estimated for the oxidation catalyst control 

technologies, because this control technology does not increase the fuel usage of the SI engine.
5

4.0 CONTROL COST EQUATIONS

Control cost equations were developed for 2SLB oxidation catalyst, 4SLB oxidation 

catalyst, and a NSCR for 4SRB engines using the total capital cost and total annual cost data for 

each control technology. Control cost equations for 2SLB and 4SLB oxidation catalysts were 

developed separately because the 2SLB oxidation catalyst requires a premium catalyst to reduce 

the HAP compounds because of the low exhaust temperature of 2SLB engines.

4.1 2SLB Oxidation Catalyst

The 2SLB oxidation catalyst is an effective control technology that reduces HAP 

emissions from a 2SLB SI engine by oxidizing organic compounds using a catalyst. The 

oxidation catalyst unit contains a honeycomb-like structure or substrate with a large surface area 

that is coated with a premium active catalyst layer, such as, platinum or palladium. The 

oxidation catalyst works by oxidizing carbon monoxide (CO) and gaseous hydrocarbons (HAP) 

in the exhaust gas to carbon dioxide (CO2) and water. The reduction of CO and HAP varies 

depending on the type of catalyst used and the exhaust temperature of the pollutant stream. 

The cost of retrofitting an oxidation catalyst to an existing 2SLB engine was estimated 

using cost data obtained from vendors and industry groups covering engines ranging from 58 

horsepower (HP) to 4,670 HP. An equipment life of 10 years and an interest rate of 7 percent 

were used to estimate the capital recovery of the control technology and the fuel penalty was 

assumed to be negligible. The cost equations are presented in 2009 dollars.

The total annualized cost equation for retrofitting an oxidation catalyst on a 2SLB engine was 

estimated to be:

2SLB Oxidation Catalyst Total Annual Cost = $11.4 x HP + $13,928

where;

HP = engine size in HP.

The linear equation has a correlation coefficient of 0.8046, which shows the data fits the 

equation closely. Therefore, this equation was used to estimate annualized cost for an oxidation 

catalyst on a 2SLB engine. 

The total capital cost equation for retrofitting an oxidation catalyst on a 2SLB engine was 

estimated to be: 

2SLB Oxidation Catalyst Total Capital Cost = $47.1 x HP + $41,603

where;

HP = engine size in HP.
6

A summary of the cost calculations, regression analyses, and graphical representations of the 

annual and capital cost data are presented in Appendix A.

4.2 4SLB Oxidation Catalyst

The 4SLB oxidation catalyst is an effective control technology that reduces HAP 

emissions from a 4SLB SI engine by oxidizing organic compounds using a catalyst. The 

oxidation catalyst unit contains a honeycomb-like structure or substrate with a large surface area 

that is coated with a premium active catalyst layer, such as, platinum or palladium. The 

oxidation catalyst works by oxidizing CO and gaseous hydrocarbons (HAP) in the exhaust gas to 

CO2 and water. The reductions of CO and HAP vary depending on the type of catalyst used and 

the exhaust temperature of the pollutant stream. 

The cost of retrofitting an oxidation catalyst to an existing 4SLB engine was estimated 

using cost data obtained from vendors and industry groups covering engines ranging from 400

HP to 8,000 HP. Again, an equipment life of 10 years and an interest rate of 7 percent were used 

to estimate the capital recovery of the control technology and the fuel penalty was assumed to be 

negligible. The cost equations are presented in 2009 dollars.

The total annualized cost equation for retrofitting an oxidation catalyst on a 4SLB engine was 

estimated to be:

4SLB Oxidation Catalyst Total Annual Cost = $1.81 x HP + $3,442

where;

HP = engine size in HP.

The linear equation has a correlation coefficient of 0.9779, which shows the data fits the 

equation very closely. Therefore, this equation was used to estimate annualized cost for an 

oxidation catalyst on a 4SLB engine. 

The total capital cost equation for retrofitting an oxidation catalyst on a 4SLB SI engine was 

estimated to be: 

4SLB Oxidation Catalyst Total Capital Cost = $12.8 x HP + $3,069

where;

HP = engine size in HP.

A summary of the cost calculations, regression analyses, and graphical representations of the 

annual and capital cost data are presented in Appendix A.
7

4.3 Non-Selective Catalytic Reduction

The NSCR or three-way catalyst is used to control HAP emissions from 4SRB engines. 

In addition to HAP reductions, NSCR also reduces the emissions of nitrogen oxides (NOx), CO, 

and other hydrocarbons (HC). The reduction of HAP and CO takes place through an oxidation 

reaction that converts HAP to CO2 and water and converts CO to CO2. The conversion of NOx

takes place through a reduction of the NOx to nitrogen gas and oxygen.

The cost of retrofitting an NSCR on an existing 4SRB engine was estimated based on 

cost data received from vendors and industry groups. A linear regression analysis was done on 

the data set and the linear equation for annualized cost was;

NSCR Annual Cost = $4.77 x HP + $5,679

where;

HP = engine size in HP.

The linear equation has a correlation coefficient of 0.7987, which shows an acceptable 

representation of the cost data. Therefore, this equation was used to estimate annualized cost for 

retrofitting the NSCR control technology on 4SRB engines. 

The capital cost equation for retrofitting an air-to-fuel ratio (AFR) controller and NSCR on a 

4SRB engine was estimated to be: 

NSCR Capital Cost = $24.9 x HP + $13,118

where;

HP = engine size in HP.

A summary of the cost calculations, regression analyses, and graphical representations of the 

annual and capital cost data are presented in Appendix A.
8

5.0 SUMMARY

The following table presents a summary of the annual and capital control costs as a 

function of engine size for the control technologies applicable to existing stationary SI engines, 

as discussed in this memorandum. 

Table 1. Summary of Annual and Capital Costs Equations 

for Existing Stationary SI Engines

HAP Control Device Annual Cost ($2009) Capital Cost ($2009)

2SLB Oxidation Catalyst $11.4 x HP + $13,928 $47.1 x HP + $41,603

4SLB Oxidation Catalyst $1.81 x HP + $3,442 $12.8 x HP + $3,069

NSCR $4.77 x HP + $5,679 $24.9 x HP + $13,118
9

6.0 References

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", 

October 2009, Attachment N (EPA-HQ-OAR-2008-0708-0279).

Email from Bruce Chrisman, Cameron's Compression Systems to Tanya Parise, EC/R, Subject: 

Existing RICE NESHAP - Information for EPA for 2SLB Engines, October 16, 2009.

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - Cameron 

oxidation catalyst pricing, October 20, 2009.

Anadarko Petroleum Corporation Comments on the Proposed Revisions to the National 

Emission Standard for Hazardous Air Pollutants for Reciprocating Internal Combustion Engines, 

June 2, 2009, Case Study (EPA-HQ-OAR-2008-0708-0186).

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: Clarification of 

SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR-2005-0030-0086).

Email from Antonio Santos, MECA to Tanya Parise, EC/R, Subject: EPA Proposed Existing 

RICE NESHAP - Cost of Aftertreatment, October 2, 2009. Response #2.

Price quote from Charles Ball, Emissions & Silencer Technology for an oxidation catalyst for a 

500 HP 4SLB engine.

Memorandum from Tom McGrath, IES to Brad Nelson, EC/R, Request for Additional Cost 

Detail for Gas-Fired Engines Emission Controls, April 19, 2010.

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", 

October 2009, Attachment D (EPA-HQ-OAR-2008-0708-0279).

Email from Nick Huff, Miratech to Jennifer Synder, AGTI, SCR Questions for RICE MACT, 

October 23, 2003 (EPA-HQ-OAR-2005-0029-0038).

Email from Mike Leonard, Miratech to Brad Nelson, AGTI, Information Request, July 21, 2005 

(EPA-HQ-OAR-2005-0030-0087).

Four Corners Air Quality Task Force Report of Mitigation Options, November 1, 2007. 

Mitigation Option: Use of NSCR/3-Way Catalysts and Air/Fuel Ratio Controllers on Rich Burn 

Stoichiometric Engines (EPA-HQ-OAR-2008-0708-0009).
10

Appendix A

Control Cost Summary and Linear Regression Statistics
11

2SLB Oxidation Catalyst Cost ($2009)

Direct Costs Indirect Costs

PEC DIC IIC C O&M Materials O&M Labor

Total Direct

Annual Cost 

(TDAC)

Administrative 

Charges 

(ADMC)

Fuel Penalty 

(FPC)

Capital 

Recovery (CRC)

Total Indirect 

Annual Cost

(TIAC)

296 $24,987 $29,485 $8,845 $8,256 $885 $47,470 $7,958 $875 $8,833 $225 $0 $6,759 $6,984 $15,817

Technical Report: RICE NESHAP Control Costs Background for "Above the 

Floor Analysis", October 2009, Attachment N (EPA-HQ-OAR-2008-0708-0279)

192 $24,987 $29,485 $8,845 $8,256 $885 $47,470 $7,958 $875 $8,833 $225 $0 $6,759 $6,759 $15,592

Technical Report: RICE NESHAP Control Costs Background for "Above the 

Floor Analysis", October 2009, Attachment N (EPA-HQ-OAR-2008-0708-0279)

384 $30,409 $35,883 $10,765 $10,047 $1,076 $57,771 $7,958 $875 $8,833 $225 $0 $8,225 $8,225 $17,058

Technical Report: RICE NESHAP Control Costs Background for "Above the 

Floor Analysis", October 2009, Attachment N (EPA-HQ-OAR-2008-0708-0279)

800 $50,901 $60,063 $18,019 $16,818 $1,802 $96,702 $7,958 $875 $8,833 $225 $0 $13,768 $13,768 $22,601

Technical Report: RICE NESHAP Control Costs Background for "Above the 

Floor Analysis", October 2009, Attachment N (EPA-HQ-OAR-2008-0708-0279)

58 $12,191 $14,385 $4,316 $4,028 $432 $23,160 $7,958 $875 $8,833 $225 $0 $3,298 $3,298 $12,131

Email from Bruce Chrisman, Cameron's Compression Systems to Tanya 

Parise, EC/R, Subject: Existing RICE NESHAP - Information for EPA for 2SLB 

Engines, October 16, 2009

600 $51,378 $60,626 $18,188 $16,975 $1,819 $97,608 $7,958 $875 $8,833 $225 $0 $13,897 $14,122 $22,955

Email from Bruce Chrisman, Cameron's Compression Systems to Tanya 

Parise, EC/R, Subject: Existing RICE NESHAP - Information for EPA for 2SLB 

Engines, October 16, 2009

148 $14,589 $17,215 $5,165 $4,820 $516 $27,716 $7,958 $875 $8,833 $225 $0 $3,946 $4,171 $13,004

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - 

Cameron oxidation catalyst pricing, October 20, 2009

296 $22,123 $26,105 $7,832 $7,309 $783 $42,029 $7,958 $875 $8,833 $225 $0 $5,984 $6,209 $15,042

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - 

Cameron oxidation catalyst pricing, October 20, 2009

192 $14,589 $17,215 $5,165 $4,820 $516 $27,716 $7,958 $875 $8,833 $225 $0 $3,946 $4,171 $13,004

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - 

Cameron oxidation catalyst pricing, October 20, 2009

384 $22,123 $26,105 $7,832 $7,309 $783 $42,029 $7,958 $875 $8,833 $225 $0 $5,984 $6,209 $15,042

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - 

Cameron oxidation catalyst pricing, October 20, 2009

600 $30,409 $35,883 $10,765 $10,047 $1,076 $57,771 $7,958 $875 $8,833 $225 $0 $8,225 $8,450 $17,283

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - 

Cameron oxidation catalyst pricing, October 20, 2009

800 $37,871 $44,688 $13,406 $12,513 $1,341 $71,947 $7,958 $875 $8,833 $225 $0 $10,244 $10,469 $19,302

Email from James Harrison, Exterran to Melanie King, EPA, Subject: 2SLB - 

Cameron oxidation catalyst pricing, October 20, 2009

3850 $210,000 $25,000 $225 $0 $29,899 $30,124 $55,124

Anadarko Petroleum Corporation Comments on the Proposed Revisions to 

the National Emission Standard for Hazardous Air Pollutants for 

Reciprocating Internal Combustion Engines, June 2, 2009, Case Study (EPAHQ-OAR-2008-0708-0186). Cost is for installation on a Clark TLAD-8 2SLB 

gas compressor engine.

4670 $210,000 $25,000 $225 $0 $29,899 $30,124 $55,124

Anadarko Petroleum Corporation Comments on the Proposed Revisions to 

the National Emission Standard for Hazardous Air Pollutants for 

Reciprocating Internal Combustion Engines, June 2, 2009, Case Study (EPAHQ-OAR-2008-0708-0186). Cost is for installation on a Cooper Bessemer

2SLB gas compressor engine.

2166 $210,000 $25,000 $225 $0 $29,899 $30,124 $55,124

Anadarko Petroleum Corporation Comments on the Proposed Revisions to 

the National Emission Standard for Hazardous Air Pollutants for 

Reciprocating Internal Combustion Engines, June 2, 2009, Case Study (EPAHQ-OAR-2008-0708-0186). Cost is for installation on a MEP 2SLB gas 

compressor engine.

1859 $210,000 $25,000 $225 $0 $29,899 $30,124 $55,124

Anadarko Petroleum Corporation Comments on the Proposed Revisions to 

the National Emission Standard for Hazardous Air Pollutants for 

Reciprocating Internal Combustion Engines, June 2, 2009, Case Study (EPAHQ-OAR-2008-0708-0186). Cost is for installation on a MEP 2SLB gas 

compressor engine.

Assumptions:

PEC = 118% of purchased equipment cost (PEC).

DIC = 30% of purchased equipment cost (PEC).

IIC = 28% of purchased equipment cost (PEC).

C = 3% of purchased equipment cost (PEC).

Capital Recovery assumes equipment life of 10 years and 7% interest rate. 0.142377503

O&M Materials cost covers the annualized equipment cost to replace the catalyst (every 3 years), thermocouples (every 7.5 years), crankcase filters (3 months), and annual catalyst rotation for cleaning. [Source: Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 2009, 

Attachment N (EPA-HQ-OAR-2008-0708-0279)]

O&M Labor cost covers the annualized labor cost to replace and rotate (for cleaning) catalyst, thermocouples, and crankcase filter. [Source: Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 2009, Attachment N (EPA-HQ-OAR-2008-0708-0279)]

Direct Annual Costs Indirect Annual Costs

Engine Size

(HP)

Equipment

Cost

Total Annual 

Cost Data Source

Total Capital 

Cost
12

2SLB Oxidation Catalyst Cost ($2009)

SUMMARY OUTPUT - Capital Cost

Regression Statistics

Multiple R 0.887931512

R Square 0.788422369

Adjusted R Square0.773309682

Standard Error 34869.66159

Observations 16

ANOVA

df SS MS F Significance F

Regression 1 63432625775 63432625775 52.16956604 4.40556E-06

Residual 14 17022506190 1215893299

Total 15 80455131965

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 41602.60574 11206.04006 3.712516244 0.002319141 17568.04028 65637.1712

X Variable 1 47.0511302 6.514205394 7.222850271 4.40556E-06 33.07954923 61.02271117

SUMMARY OUTPUT - Annual Cost

Regression Statistics

Multiple R 0.896978958

R Square 0.804571251

Adjusted R Square0.790612055

Standard Error 8009.912446

Observations 16

ANOVA

df SS MS F Significance F

Regression 1 3697938056 3697938056 57.63736182 2.5054E-06

Residual 14 898221763.5 64158697.39

Total 15 4596159819

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 13928.11988 2574.140259 5.410785147 9.1811E-05 8407.138137 19449.10162

X Variable 1 11.3603976 1.496378585 7.591927411 2.5054E-06 8.150984738 14.56981046

y = 47.051x + 41603

R2 = 0.7884

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

0 1000 2000 3000 4000 5000

Total Capital Cost

Total Capital Cost Linear (Total Capital Cost)

y = 11.36x + 13928

R2 = 0.8046

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

0 1000 2000 3000 4000 5000

Total Annual Cost

Total Annual Cost Linear (Total Annual Cost)
13

4SLB Oxidation Catalyst Cost ($2009)

Direct Costs Indirect Costs

PEC DIC IIC C O&M Materials O&M Labor

Total Direct

Annual Cost 

(TDAC)

Administrative 

Charges 

(ADMC)

Fuel Penalty 

(FPC)

Capital 

Recovery (CRC)

Total Indirect 

Annual Cost

(TIAC)

500 $6,361 $7,505 $2,252 $2,102 $225 $12,084 $1,891 $1,053 $2,944 $225 $0 $1,720 $1,945 $4,889

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: 

Clarification of SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR2005-0030-0086). Costs converted from $2005 to $2009 using the Marshall 

and Swift Equipment Cost Index.

1000 $8,178 $9,650 $2,895 $2,702 $289 $15,536 $1,891 $1,053 $2,944 $225 $0 $2,212 $2,212 $5,156

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: 

Clarification of SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR2005-0030-0086). Costs converted from $2005 to $2009 using the Marshall 

and Swift Equipment Cost Index.

2000 $13,193 $15,568 $4,670 $4,359 $467 $25,064 $1,891 $1,053 $2,944 $225 $0 $3,569 $3,569 $6,513

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: 

Clarification of SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR2005-0030-0086). Costs converted from $2005 to $2009 using the Marshall 

and Swift Equipment Cost Index.

3000 $16,769 $19,787 $5,936 $5,540 $594 $31,857 $1,891 $1,053 $2,944 $225 $0 $4,536 $4,536 $7,480

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: 

Clarification of SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR2005-0030-0086). Costs converted from $2005 to $2009 using the Marshall 

and Swift Equipment Cost Index.

5000 $33,608 $39,658 $11,897 $11,104 $1,190 $63,849 $1,891 $1,053 $2,944 $225 $0 $9,091 $9,091 $12,035

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: 

Clarification of SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR2005-0030-0086). Costs converted from $2005 to $2009 using the Marshall 

and Swift Equipment Cost Index.

8000 $58,697 $69,262 $20,779 $19,393 $2,078 $111,512 $1,891 $1,053 $2,944 $225 $0 $15,877 $15,877 $18,821

Email from Mike Leonard, Miratech Corporation to Brenda Riddle, AGTI, RE: 

Clarification of SCR Cost Information for EPA, July 20, 2005. (EPA-HQ-OAR2005-0030-0086). Costs converted from $2005 to $2009 using the Marshall 

and Swift Equipment Cost Index.

1000 $8,500 $10,030 $3,009 $2,808 $301 $16,148 $1,891 $1,053 $2,944 $225 $0 $2,299 $2,524 $5,468

Email from Antonio Santos, MECA to Tanya Parise, EC/R, Subject: EPA 

Proposed Existing RICE NESHAP - Cost of Aftertreatment, October 2, 2009. 

Response #2

500 $3,700 $4,366 $1,310 $1,222 $131 $7,029 $1,891 $1,053 $2,944 $225 $0 $1,001 $1,001 $3,945 Price quote from Charles Ball, Emissions & Silencer Technology for an 

oxidation catalyst for a 500 HP 4SLB engine.

400 $6,575 $2,961 $2,005 $11,541 $1,958 $1,143 $3,101 $225 $0 $1,643 $1,643 $4,744 Memorandum from Tom McGrath, IES to Brad Nelson, EC/R, Request for 

Additional Cost Detail for Gas-Fired Engines Emission Controls

400 $6,575 $2,961 $2,005 $11,541 $1,958 $1,143 $3,101 $225 $0 $1,643 $1,643 $4,744 Memorandum from Tom McGrath, IES to Brad Nelson, EC/R, Request for 

Additional Cost Detail for Gas-Fired Engines Emission Controls

425 $7,149 $3,025 $2,005 $12,179 $1,756 $875 $2,631 $225 $0 $1,734 $1,734 $4,365 Memorandum from Tom McGrath, IES to Brad Nelson, EC/R, Request for 

Additional Cost Detail for Gas-Fired Engines Emission Controls

Assumptions:

PEC = 118% of purchased equipment cost (PEC).

DIC = 30% of purchased equipment cost (PEC).

IIC = 28% of purchased equipment cost (PEC).

C = 3% of purchased equipment cost (PEC).

Capital Recovery assumes equipment life of 10 years and 7% interest rate. 0.142377503

O&M Materials cost covers the annualized equipment cost to replace the catalyst (every 3 years), thermocouples (every 7.5 years), crankcase filters (3 months), and annual catalyst rotation for cleaning. [Source: Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 2009,

Attachment L (EPA-HQ-OAR-2008-0708-0279)]

O&M Labor cost covers the annualized labor cost to replace and rotate (for cleaning) catalyst, thermocouples, and crankcase filter. [Source: Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 2009, Attachment L (EPA-HQ-OAR-2008-0708-0279)]

Data Source

Direct Annual Costs Indirect Annual Costs

Engine Size

(HP)

Equipment

Cost

Total Annual 

Cost

Total Capital 

Cost
14

4SLB Oxidation Catalyst Cost ($2009)

SUMMARY OUTPUT - Total Capital Cost

Regression Statistics

Multiple R 0.989944875

R Square 0.979990856

Adjusted R Square0.977767618

Standard Error 4727.892942

Observations 11

ANOVA

df SS MS F Significance F

Regression 1 9853063606 9853063606 440.7943494 5.91417E-09

Residual 9 201176745.1 22352971.68

Total 10 10054240351

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 3069.26319 1884.275356 1.62888252 0.137778178 -1193.263795 7331.790175

Engine Size (HP) 12.80450452 0.609880529 20.99510299 5.91417E-09 11.42485892 14.18415013

SUMMARY OUTPUT - Total Annual Cost

Regression Statistics

Multiple R 0.988903698

R Square 0.977930524

Adjusted R Square 0.97547836

Standard Error 703.9457563

Observations 11

ANOVA

df SS MS F Significance F

Regression 1 197622721.6 197622721.6 398.8030634 9.20031E-09

Residual 9 4459856.651 495539.6279

Total 10 202082578.3

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 3441.504829 280.553654 12.26683303 6.38308E-07 2806.848372 4076.161285

X Variable 1 1.81340819 0.090806373 19.97005417 9.20031E-09 1.607989903 2.018826477

y = 12.80x + 3069

R2 = 0.9800

$0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

Total Capital Cost

Total Capital Cost Linear (Total Capital Cost)

y = 1.8134x + 3441.5

R2 = 0.9779

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

$20,000

0 1000 2000 3000 4000 5000 6000 7000 8000 9000

Total Annual Cost

Total Annual Cost Linear (Total Annual Cost)
15

4SRB NSCR Costs ($2009)

Direct Costs Indirect Costs

PEC DIC IIC C O&M Materials O&M Labor

Total Direct 

Annual Cost 

(TDAC)

Administrative

Charges

(ADMC)

Fuel Penalty 

(FPC)

Capital 

Recovery (CRC)

Total Indirect 

Annual Cost

(TIAC)

50 $8,935 $11,945 $664 $1,275 $1,939 $225 $379 $1,701 $2,305 $4,244

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

100 $10,099 $13,363 $664 $1,275 $1,939 $225 $379 $1,903 $2,507 $4,446

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

100 $10,827 $15,139 $1,071 $1,320 $2,391 $225 $695 $2,155 $3,075 $5,466

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

175 $12,284 $17,132 $1,071 $1,320 $2,391 $225 $695 $2,439 $3,359 $5,750

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

175 $10,667 $16,165 $1,706 $1,360 $3,066 $225 $1,200 $2,302 $3,727 $6,793

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

300 $16,119 $22,117 $1,706 $1,360 $3,066 $225 $1,200 $3,149 $4,574 $7,640

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

300 $11,777 $17,240 $2,384 $1,380 $3,764 $225 $2,021 $2,455 $4,701 $8,465

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

500 $16,689 $24,502 $2,384 $1,380 $3,764 $225 $2,021 $3,489 $5,735 $9,499

Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 

2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)

167 $2,588 $7,017 $11,334 $3,400 $3,173 $340 $18,247 $1,071 $1,320 $2,391 $225 $695 $2,598 $3,518 $5,909

Email from Nick Huff, Miratech to Jennifer Synder, AGTI, SCR Questions for RICE MACT, October 23, 

2003 (EPA-HQ-OAR-2005-0029-0038). Cost for NSCR/AFRC on a Caterpillar G3306 adjusted from 

$2003 to $2009. 

255 $6,091 $7,017 $15,467 $4,640 $4,331 $464 $24,902 $1,706 $1,360 $3,066 $225 $1,200 $3,545 $4,970 $8,036

Email from Nick Huff, Miratech to Jennifer Synder, AGTI, SCR Questions for RICE MACT, October 23, 

2003 (EPA-HQ-OAR-2005-0029-0038). Cost for NSCR/AFRC on a Caterpillar G3408 adjusted from 

$2003 to $2009. 

300 $6,039 $7,017 $15,405 $4,622 $4,314 $462 $24,803 $2,384 $1,380 $3,764 $225 $2,021 $3,531 $5,777 $9,541

Email from Nick Huff, Miratech to Jennifer Synder, AGTI, SCR Questions for RICE MACT, October 23, 

2003 (EPA-HQ-OAR-2005-0029-0038). Cost for NSCR/AFRC on a Caterpillar G3408 adjusted from 

$2003 to $2009. 

300 $6,113 $7,500 $16,063 $4,819 $4,498 $482 $25,862 $2,384 $1,380 $3,764 $225 $2,021 $3,682 $5,928 $9,692

Email from Mike Leonard, Miratech to Brad Nelson, AGTI, Information Request, July 21, 2005 (EPA-HQOAR-2005-0030-0087). Cost for NSCR/AFRC on a generic 300 HP rich-burn engine adjusted from 

$2005 to $2009. 

500 $7,800 $7,500 $18,054 $5,416 $5,055 $542 $29,067 $2,384 $1,380 $3,764 $225 $2,021 $4,139 $6,385 $10,149

Email from Mike Leonard, Miratech to Brad Nelson, AGTI, Information Request, July 21, 2005 (EPA-HQOAR-2005-0030-0087). Cost for NSCR/AFRC on a generic 500 HP rich-burn engine adjusted from 

$2005 to $2009. 

800 $9,924 $7,500 $20,561 $6,168 $5,757 $617 $33,103 $2,384 $1,380 $3,764 $225 $2,021 $4,713 $6,959 $10,723

Email from Mike Leonard, Miratech to Brad Nelson, AGTI, Information Request, July 21, 2005 (EPA-HQOAR-2005-0030-0087). Cost for NSCR/AFRC on a generic 500 HP rich-burn engine adjusted from 

$2005 to $2009. 

1500 $15,778 $7,500 $27,468 $8,240 $7,691 $824 $44,223 $2,384 $1,380 $3,764 $225 $2,021 $6,296 $8,542 $12,306

Email from Mike Leonard, Miratech to Brad Nelson, AGTI, Information Request, July 21, 2005 (EPA-HQOAR-2005-0030-0087). Cost for NSCR/AFRC on a generic 500 HP rich-burn engine adjusted from 

$2005 to $2009. 

3000 $39,686 $7,500 $55,679 $16,704 $15,590 $1,670 $89,644 $2,384 $1,380 $3,764 $225 $2,021 $12,763 $15,009 $18,773

Email from Mike Leonard, Miratech to Brad Nelson, AGTI, Information Request, July 21, 2005 (EPA-HQOAR-2005-0030-0087). Cost for NSCR/AFRC on a generic 500 HP rich-burn engine adjusted from 

$2005 to $2008. 

48 $3,735 $2,950 $7,762 $4,080 $11,842 $480 $540 $1,020 $225 $0 $1,686 $1,911 $2,931

Four Corners Air Quality Task Force Report of Mitigation Options, November 1, 2007. Mitigation 

Option: Use of NSCR/3-Way Catalysts and Air/Fuel Ratio Controllers on Rich Burn Stoichiometric 

Engines (EPA-HQ-OAR-2008-0708-0009). TCC includes cost of catalyst housing ($2,385), catalyst

element ($1,000), AFRC ($2,950), installation of catalyst housing and support ($1,380), installation 

and setup of AFRC ($2,160), solar panel electricity for AFRC control ($350), installation of solar panel 

electricity to AFRC ($540), and taxes/freight ($1,077). TDAC includes annual cost for quarterly change 

of O2 sensor and emissions monitoring ($320), labor and travel to site ($540), and annualized cost of 

catalyst replacement 5 year life ($160). Cost quoted for a Compressco Ford 460.

23 $2,925 $2,950 $6,952 $4,080 $11,032 $480 $540 $1,020 $225 $0 $1,571 $1,796 $2,816

Four Corners Air Quality Task Force Report of Mitigation Options, November 1, 2007. Mitigation 

Option: Use of NSCR/3-Way Catalysts and Air/Fuel Ratio Controllers on Rich Burn Stoichiometric 

Engines (EPA-HQ-OAR-2008-0708-0009). TCC includes cost of catalyst housing ($1,775), catalyst

element ($800), AFRC ($2,950), installation of catalyst housing and support ($1,380), installation and 

setup of AFRC ($2,160), solar panel electricity for AFRC control ($350), installation of solar panel 

electricity to AFRC ($540), and taxes/freight ($1,077). TDAC includes annual cost for quarterly change 

of O2 sensor and emissions monitoring ($320), labor and travel to site ($540), and annualized cost of 

catalyst replacement 5 year life ($160). Cost quoted for a Waukesha 220/330.

Assumptions:

PEC = 118% of purchased equipment cost (PEC).

DIC = 30% of purchased equipment cost (PEC).

IIC = 28% of purchased equipment cost (PEC).

C = 3% of purchased equipment cost (PEC).

Direct Annual Cost = ($5 x Hp) + (14.26 x 5).

Indirect Annual Cost = 60% of direct annual cost + 4% of total capital cost + capital recovery.

Capital Recovery assumes equipment life of 10 yea0. rs and 7% 14237503 interest rate.

O&M Materials cost covers the annualized equipment cost to replace the catalyst (every 3 years), thermocouples (every 7.5 years), crankcase filters (3 months), and annual catalyst rotation for cleaning. [Source: Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 2009, 

Attachment D (EPA-HQ-OAR-2008-0708-0279)]

O&M Labor cost covers the annualized labor cost to replace and rotate (for cleaning) catalyst, thermocouples, and crankcase filter. [Source: Technical Report: RICE NESHAP Control Costs Background for "Above the Floor Analysis", October 2009, Attachment D (EPA-HQ-OAR-2008-0708-0279)]

Total Annual 

Cost Data Source

Direct Annual Costs Indirect Annual Costs

Engine Size 

(HP)

Equipment 

Cost AFRC Cost

Total Capital 

Cost
16

4SRB NSCR Costs ($2009)

SUMMARY OUTPUT - Total Capital Cost

Regression Statistics

Multiple R 0.984731321

R Square 0.969695774

Adjusted R Square 0.96780176

Standard Error 3273.282484

Observations 18

ANOVA

df SS MS F Significance F

Regression 1 5485538418 5485538418 511.9791654 1.41597E-13

Residual 16 171430051.5 10714378.22

Total 17 5656968469

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 13117.61245 933.7363075 14.0485192 2.03296E-10 11138.17991 15097.04498

Engine Size (HP) 24.92848169 1.101716069 22.62695661 1.41597E-13 22.59294798 27.26401541

SUMMARY OUTPUT - Total Annual Cost

Regression Statistics

Multiple R 0.893674092

R Square 0.798653382

Adjusted R Square0.786069219

Standard Error 1777.457825

Observations 18

ANOVA

df SS MS F Significance F

Regression 1 200508408.1 200508408.1 63.46495544 5.85557E-07

Residual 16 50549701.12 3159356.32

Total 17 251058109.2

Coefficients Standard Error t Stat P-value Lower 95% Upper 95%

Intercept 5679.133777 507.0374813 11.20061926 5.54849E-09 4604.262341 6754.005214

X Variable 1 4.765983033 0.59825385 7.96648953 5.85557E-07 3.497741535 6.034224532

y = 24.928x + 13118

R2 = 0.9697

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$90,000

$100,000

0 500 1000 1500 2000 2500 3000 3500

Total Capital Cost

Total Capital Cost Linear (Total Capital Cost)

y = 4.766x + 5679.1

R2 = 0.7987

$0

$5,000

$10,000

$15,000

$20,000

$25,000

0 500 1000 1500 2000 2500 3000 3500

Total Annual Cost

Total Annual Cost Linear (Total Annual Cost)