### MEMORANDUM

DATE: April 16
, 201 5

SUBJECT: Final Rule Mercury Control Options and Impacts for the Ferroalloys Production Industry

FROM: Bradley Nelson, EC/R, Inc.

TO: Phil Mulrine , EPA OAQPS/SPPD/ M IC G

1.0 PURPOSE

The purpose of this memorandum is to present updated mercury (Hg) control impacts for the ferroalloy furnace smelting operation based on the revised ferroalloys Risk and Technology Review (RTR) emissions data set

. 1 

### Th e impacts include the capital and annual control costs
, emission reductions, and cost effectiveness for each of these Hg control options

. This analysis supplements the original control option impacts analysis 2 

### prepared in support of the 2014 supplemental proposed amendments to the national emission standards for hazardous air pollutants (NESHAP) for the ferroalloys production source category
, published in the Federal Register on October 10 , 201 4 (7 9 FR 60238 ).

The Hg e missions estima tes have been re

- calculated incorporating newly provided test data 3
, 4
, 5 

### received prior to and after the publication of the 2014 supplemental proposal

. This additional test data was received from one of the facilities, and provides additional HAP data for some pollutants at previously tested emission sources, including Hg data from each of the operational furnaces at a single facility, one furnace produci ng FerroManganese (FeMn) and the other

1 " Revised Development of the Risk and Technology Review (RTR) Emissions Dataset for the Ferroalloys Production S ource Category for the 2015 Final Rule ", April 201 5
, Available in the docket, EPA

- HQ

- OAR

- 2010

- 0895

. 2 "Mercury Control Options and Impacts for the Ferroalloys Production Industry ", August 29 , 201 4 , EPA

- HQ

OAR

- 2010

- 0895

- 0175

. 3 "Emission Measurement Summary Report Furnace No. 12 Scrubber PAHs and Mercury Eramet Marietta Inc. Marietta, OH", January 2013, Available in the docket, EPA

- HQ

- OAR

- 2010

- 0895

. 4 "Polycyclic Aromatic Hydrocarbons and Mercury Emission Summary Report EAF No. 12 Scrubber EAF No. 1 Baghouse Eramet Marietta Inc. Marietta, OH", November 2014, Available in the docket, EPA

- HQ

- OAR

- 2010

- 0895

. 5 "Emission Measurement Summary Report Filterable Particulate Matter Furnaces 1 and 12 Eramet Marietta, Inc. Marietta, Ohio", A pril 2014, Available in the docket, EPA

- HQ

- OAR

- 2010

- 0895

.2 

### producing SilicoManganese (SiMN), and additional PM data from from one furnace at one of the facilities.

Other than incorporating these additonal emission test data (and their subsequent effects on costs and cost e ffectiveness) , the methodology of these analyses are unchanged from those described in the previous mercury options & impacts mem o. 2 

### Background i nformation, facility summaries, mercury control options , and impact calculation methodology are unchanged from the previous memorandum, and are not included here. The revised maximum achievable control technology (MACT) floor for mercury incorporating the new emissions data is detailed in the revised MACT Floor memo , available in the docket

. 6



### 2 .0 MERCURY CONTROL OPTION IMPACTS
The impacts of reducing mercury emissions from the furnace smelting process at ferroalloys production facilities are based o n the costs and emission reductions achieved through the retrofit of activated carbon injection ( ACI )

. This section summarizes the estimated capital cost, annual cost, and expected mercury emission reduction of retrofitting ACI on the furnaces at Eramet and Felman.

The assumptions and methodology used to estimate these impacts are unchanged from those detailed in the previous memorandum 2 

### , and are not included here. The estimated emissions upon which these impact estimates are based have been updated to incorporate the new test data described above , and are available in the do cket

. 1



### A summary of the impacts for each of the proposed Mercury Control Options is presented in Table 2

- 1 . The impacts for Control Option 1 were calculated to be zero. These impacts are based on the assumption that the facilities would be able to meet the mercury limits with their current furnace controls

. The impacts for Control Option 2 are based on th e installation of ACI on Furnace s 1 and 12 at Eramet with operation only during the production of FeMn , and a polishing baghouse on Furnace 1 . The emission s and annual cost for this option are based on the assumption that both furnaces produce FeMn 50 per cent annually (or 4,380 hours per year). 7 

### The mercury reduction is assumed to be 90 percent for the installation of ACI and the polishing baghouse on Furnace 1 at Eramet, and 5 0 percent for installation of ACI and the existing scrubber on Furnace 12 at Er amet.

6 " Revised MACT Floor Analysis for the Ferroalloys Production Source Category ", April 201 5, Available in the docket, EPA

- HQ

- OAR

- 2010

- 0895

. 7 Cost effectiveness varies significantly with the percent age of FeMn production. As shown in Table 2

- 2, the Option 1 cost effectiveness for Eramet EAF 1 at 50% FeMn production is approximately $13 ,600/lb Hg. For the same furnace producing 100% FeMn, the cost effectiveness would be approximately $7,100/lb Hg.3 

### The impacts for Control Option 3 were calculated assuming that all furnaces at Eramet and Felman would install and operate ACI during FeMn and SiMn production. Again, the assumption is that ACI would be installed downstream from the Furnace 1 bagh ouse and a second polishing baghouse would be added. The emissions and annual cost for this option are based on the assumption that both furnaces at Eramet produce 50 percent annually (or 4,380 hours per year) of FeMn and 50 percent annually of SiMn. The furnaces at Felman are assumed to produce SiMn only. The mercury reduction is assumed to be 90 percent for the installation of ACI and the polishing baghouse on Furnace 1, and 5 0 percent for installation of ACI and the existing scrubber on Furnace 12 at Eramet. The mercury reduction for ACI installed with the existing baghouses at Felman is assumed to be 90 percent.

A breakdown of the individual furnace emission reductions and the capital and annual costs are provided in Tables 2

- 2 and 2

- 3 . The spreadsheet calculation sheet with the control cost algorithms is provided in Appendix A for Options 2 and 3.4 

### Table 2

- 1 . Summary o f the Updated Estimated Emissions Reductions and Cost Impacts for the Mercury Control Option s Considered for Existing Furnaces

Mercury Control Option Hg Emission Reductions (lb/yr) Total Capital Cost ($2012) Total Annual Cost ($/year) Cost Effectiveness ($/lb)

Option 1

– MACT Floor for FeMn and SiMn Production 0 $0 $0

-----

Option 2

– Beyond

the

- floor for FeMn Production and MACT Floor for SiMn Production 263 $ 30
, 19 6 , 00 0 $ 3
, 3 6 2
, 000 $1 2
, 800

Option 3

– Beyond

the

- floor for FeMn and SiMn Production 32 9 $ 41
, 68 2
, 000 $ 6 , 8 7 3
, 000 $ 20,9 005 

### Table 2

- 2 . Summary of Updated Mercury Cost Effectiveness for Control Option 2 ( Beyond

- the

- floor Mercury Control for Furnaces Producing FeMn Only)

Cost Parameter Eramet EAF 1 Cost ($2012) Eramet EAF 12 Cost ($2012) Total Eramet Cost ($2012) 1 Existing FF w/

ACI & New Polishing FF ACI w/ Existing Venturi Scrubber
Polishing Baghouse Capital Cost 2 $14,659,265 $0 $14,659,265
Activated Carbon Injection Capital Cost 2 $3,184,766 $3,625,211 $6,809,977
Other Installation Capital Cost 3 $7,974,497 $752,231 $8,726,729
Total Capital Cost $25,818,528 $4,377,442 $30,195,970 Direct Annual Cost ($/yr) 4 $217,476 $318,449 $535,925 Indirect Annual Cost ($/yr) 5 $2,334,447 $491,529 $2,825,976 Total Annual Cost ($/yr) $2,551,924 $809,977 $3,361,901 Mercury Emission Rate (lb/yr) 208.6 151.1 359.7 Mercury Emission Reduction w/ ACI (lb/yr) 6 187.7 75.6 263.3 Mercury Cost Effectiveness ($/lb) $13,595 $10,718 $12,769

1 Mercury Control Option 1 includes: Eramet EAF 1

- adding ACI and polishing FF to existing EAF #1 w/ FF, Eramet EAF 12

- adding ACI to existing EAF #12 w/ VS.

2 ACI and BH costs developed using capital and annual cost algorithms from the IPM Model

- Revisions to Cost and Performance for APC Technologies, Mercury Control Cost Development Methodology, March 2011.

3 Other installation capital costs include: enginee ring and construction management, construction labor adjustment, and contractor profit & fees.

4 Direct annual costs include: operating labor, administrative and supervisory labor, maintenance labor and materials, activated carbon, and non

- hazardous dust disposal for Eramet.

5 Indirect annual costs include: overhead, property tax, insurance, administration, and capital recovery (20 years @ 7% interest).

6 Assumes 90% mercury reduction for FF and 50% mercury reduction with a VS.

### Table 2

- 3 . Summary of Updated Mercury Cost Effectiveness for Control Option 3 ( Beyond

- the

- floor Mercury Control for Furnaces Producing FeMn and SiMn)

Felman Furnace 2

Cost ($2012) Felman Furnace 5 Cost ($2012) Felman Furnace 7 Cost ($2012) Eramet EAF 1 Cost ($2012) Eramet EAF 12 Cost ($2012)

ACI w/ Existing

Fabric Filter ACI w/ Existing Fabric Filter ACI w/ Existing Fabric Filter Existing FF w/ ACI & New Polishing FF ACI w/ Existing Venturi Scrubber

Polishing Baghouse Capital Cost 2 $0 $0 $0 $0 $14,659,265 $0 $14,659,265
Activated Carbon Injection Capital Cost 2 $3,320,988 $3,069,015 $3,122,161 $9,512,164 $3,184,766 $3,625,211 $6,809,977
Other Installation Capital Cost 3 $689,105 $636,821 $647,848 $1,973,774 $7,974,497 $752,231 $8,726,729
Total Capital Cost $4,010,093 $3,705,836 $3,770,009 $11,485,937 $25,818,528 $4,377,442 $30,195,970 Direct Annual Cost ($/yr) 4 $653,379 $513,562 $737,893 $1,904,834 $314,092 $534,324 $848,417 Indirect Annual Cost ($/yr) 5 $451,132 $417,674 $424,731 $1,293,537 $2,334,447 $491,529 $2,825,976 Total Annual Cost ($/yr) $1,104,511 $931,236 $1,162,624 $3,198,371 $2,648,540 $1,025,853 $3,674,393
Mercury Emission Rate (lb/yr) 6 21.5 4.39 8.93 34.8 238.3 165.8 404.1 Mercury Emission Reduction w/ ACI (lb/yr) 7 19.3 3.95 8.03 31.3 214.4 82.9 297.3 Mercury Cost Effectiveness ($/lb) $57,143 $235,763 $144,717 $102,143 $12,351 $12,373 $12,357

7 Assumes 90% mercury reduction for FF and 50% mercury reduction with a VS. 5 Indirect annual costs include: overhead, property tax, insurance, administration, and capital recovery (20 years @ 7% interest). Total Eramet Cost ($2012) 1

6 Eramet mercury enhanced capture emissions based on 50/50 production of FeMn and SiMn. Felman mercury enhanced capture emissions based on 100% production of SiMn. Total Felman Cost ($2012) 1

1 Mercury Control Option 1 includes: Eramet EAF 1 - adding ACI and polishing FF to existing EAF #1 w/ FF, Eramet EAF 12 - adding ACI to existing EAF #12 w/ VS. Cost Parameter

2 ACI and BH costs developed using capital and annual cost algorithms from the IPM Model - Revisions to Cost and Performance for APC Technologies, Mercury Control Cost Development Methodology, March 2011.
3 Other installation capital costs include: engineering and construction management, construction labor adjustment, and contractor profit & fees.
4 Direct annual costs include: operating labor, administrative and supervisory labor, maintenance labor and materials, activated carbon, and non-hazardous dust disposal.

### Appendix A

ACI Control Cost Spreadsheet Calculation Sheets for the Mercury Control OptionsActivated Carbon Injection Model Costs 1 - Option 2

Ferroalloys Furnace Eramet EAF 1

Control Device Existing FF w/ ACI & New Polishing FF Annual Operating Hours, hr/yr (H) 8760 Exhaust Gas Flow Rate, acfm (Qa) 243,217 Exhaust Gas Flow Rate, dscfm (Q) 187,152 Operating Labor Rate, $/hr (LR) $60.00 Labor rates listed in Eramet Comments Activated Carbon Cost, $/lb (ACC) $0.85 Cost for from IPM ($1700/Ton, 2012 dollars) Dust Disposal Cost, $/Ton (DDC, Non-Hazardous) $30.00 Cost based on email from Chuck French 11/05/2013, FW: Question regarding costs of diposing ACI mercury control wastes Dust Disposal Cost, $/Ton (DDC, Hazardous) N/A Dust is assumed not to be hazardous waste Capital Recovery Factor (CRF) 0.094392926 CRF calculated assuming 20-year equipment life and 7% interest ACI Adjustment Factor (AF) 0.9 Estimated Hg control efficiency ACI Injection Rate (lb/MMacf) 2.0 ACI Injection Rate, lb/hr (M) 29.2 Calculated using acfm*60*ACI Injection Rate (lb/MMACF)/1000000 Retrofit Factor 1.2 Outlet PM Emission Rate (Tons/yr) 9.9 PM emission rate during FeMn production

ACI Total Capital Investment, $ (TCI) $3,184,766 Calculated using algorithm 1 1,600,000*Retrofit Factor*ACI Injection Rate (lb/hr) (2012 dollars) BH Total Capital Investmant, $ (TCI) $14,659,265 Calculated using algorithm 1 530*Retrofit Factor*(acfm^0.81) for 6.0 cloth-to-air ratio (2012 dollars) Engineering & Construction Management $1,784,403 10% of total TCI w/ baghouse, 5% of TCI w/o baghouse Labor Adjustment (shift, per diem, etc.) $1,784,403 10% if baghouse addition, else 5% of total TCI Contractor Profit and Fees $1,784,403 10% if baghouse addition, else 5% of total TCI Capital, Engineering, and Construction Cost, $ (CECC) $23,197,240
Owners costs $1,159,862 5% of CECC (Owners engineering, management, and procurement activities) Engineering and construction cycle $1,461,426 6% of CECC + Owners cost for additional baghouse (2-year engineering and construction cycle), 0% for ACI only (1-year engineering and construction cycle) Total Project Cost, $ (TPC) $25,818,528

Direct Annual Cost, $/yr (DAC) Operating Labor $16,425 Calculated using (0.25 hr/8-hr shift) x 3 shifts/day x 365 days/yr x LR Administration & Supervisory Labor $1,385 Calculated using 3% of the sum of the Operating Labor and 40% of the Maintainance Maintenance & Materials $74,350 Fixed O&M additional maintenance material and labor costs (0.01 for ACI only, 0.005 BH and ACI) Activated Carbon $217,319 Dust Disposal (Non-Hazardous) $33,313 Calculated using ACI injection rate, 99% capture efficiency, and non-hazardous disposal cost

Indirect Annual Cost, $/yr (IAC) Overhead $55,296 OAQPS Control Cost Manual - calculated using 0.6 x (Labor + Maintenance) Property Tax, Insurance, & Admin $594,801 OAQPS Control Cost Manual - calculated using 0.04 x TCI Capital Recovery $1,684,350.28 Calculated using CRF x TCI

Total Annual Cost $2,677,240 Sum of DAC + IAC

1 Sargent & Lundy, IPM Model - Revisions to Cost and Performance for APC Technologies, Mercury Control Cost Development Methodology Final, March 20139 Activated Carbon Injection Model Costs 1 - Option 3

Ferroalloys Furnace Felman EAF 2 Felman EAF 5 Felman EAF 7 Eramet EAF 1 Eramet EAF 12

Control Device ACI w/ Existing Fabric Filter ACI w/ Existing Fabric Filter ACI w/ Existing Fabric Filter Existing FF w/ ACI & New Polishing FF ACI w/ Existing Venturi Scrubber Annual Operating Hours, hr/yr (H) 8760 8760 8760 8760 8760 Exhaust Gas Flow Rate, acfm (Qa) 321,558 190,022 213,065 243,217 230,724 Scrubber outlet flow rates for EAF 12 corrected to 375 F to estimate inlet flow rate Exhaust Gas Flow Rate, dscfm (Q) 195,393 123,696 142,661 187,152 146,142 Operating Labor Rate, $/hr (LR) $60.00 $60.00 $60.00 $60.00 $60.00 Labor rates listed in Eramet Comments Activated Carbon Cost, $/lb (ACC) $0.75 $0.75 $0.75 $0.75 $0.75 Cost for from IPM ($1500/Ton, 2009 dollars) Dust Disposal Cost, $/Ton (DDC, Non-Hazardous) $30.00 $30.00 $30.00 $30.00 $30.00 Cost based on email from Chuck French 11/05/2013, FW: Question regarding costs of diposing ACI mercury control wastes Dust Disposal Cost, $/Ton (DDC, Hazardous) N/A N/A N/A N/A N/A Dust is assumed not to be hazardous waste Capital Recovery Factor (CRF) 0.094392926 0.094392926 0.094392926 0.094392926 0.094392926 CRF calculated assuming 20-year equipment life and 7% interest ACI Adjustment Factor (AF) 0.9 0.9 0.9 0.9 0.5 Estimated Hg control efficiency ACI Injection Rate (lb/MMacf) 2.0 2.0 2.0 2.0 5.0 ACI Injection Rate, lb/hr (M) 38.6 22.8 25.6 29.2 69.2 Calculated using acfm*60*ACI Injection Rate (lb/MMacf)/1000000 Retrofit Factor 1.2 1.2 1.2 1.2 1.2 Outlet PM Emission Rate (Tons/yr) 14.5 13.2 21.7 8.9 41.1

ACI Total Capital Investment, $ (TCI) $3,320,988 $3,069,015 $3,122,161 $3,184,766 $3,625,211 Calculated using algorithm 1 1,600,000*Retrofit Factor*ACI Injection Rate (lb/hr) (2012 dollars) BH Total Capital Investmant, $ (TCI) $0 $0 $0 $14,659,265 $0 Calculated using algorithm 1 530*Retrofit Factor*(acfm^0.81) for 6.0 cloth-to-air ratio (2012 dollars) Engineering & Construction Management $166,049 $153,451 $156,108 $1,784,403 $181,261 10% of total TCI w/ baghouse, 5% of TCI w/o baghouse Labor Adjustment (shift, per diem, etc.) $166,049 $153,451 $156,108 $1,784,403 $181,261 10% if baghouse addition, else 5% of total TCI Contractor Profit and Fees $166,049 $153,451 $156,108 $1,784,403 $181,261 10% if baghouse addition, else 5% of total TCI Capital, Engineering, and Construction Cost, $ (CECC) $3,819,136 $3,529,367 $3,590,485 $23,197,240 $4,168,993
Owners costs $190,957 $176,468 $179,524 $1,159,862 $208,450 5% of CECC (Owners engineering, management, and procurement activities) Engineering and construction cycle $0 $0 $0 $1,461,426 $0 6% of CECC + Owners cost for additional baghouse (2-year engineering and construction cycle), 0% for ACI only (1-year engineering and construction cycle) Total Project Cost, $ (TPC) $4,010,093 $3,705,836 $3,770,009 $25,818,528 $4,377,442

Direct Annual Cost, $/yr (DAC) Operating Labor $16,425 $16,425 $16,425 $16,425 $16,425 Calculated using (0.25 hr/8-hr shift) x 3 shifts/day x 365 days/yr x LR Administration & Supervisory Labor $825 $800 $805 $1,385 $855 Calculated using 3% of the sum of the Operating Labor and 40% of the Maintainance Maintenance & Materials $27,675 $25,575 $26,018 $74,350 $30,210 Fixed O&M additional maintenance material and labor costs (0.01 for ACI only, 0.005 BH and ACI) Activated Carbon $253,516 $149,813 $167,980 $191,752 $454,757 Dust Disposal (Non-Hazardous) $132,762 $119,050 $194,378 $30,180 $32,077 Calculated using ACI injection rate, 99% capture efficiency, and non-hazardous disposal cost Additional ore for loss of BH dust $222,176 $201,899 $332,287 $0 $0 $756,361

Indirect Annual Cost, $/yr (IAC) Overhead $26,955 $25,680 $25,949 $55,296 $28,494 OAQPS Control Cost Manual - calculated using 0.6 x (Labor + Maintenance) Property Tax, Insurance, & Admin $110,700 $102,300 $104,072 $594,801 $120,840 OAQPS Control Cost Manual - calculated using 0.04 x TCI Capital Recovery $313,478 $289,693 $294,710 $1,684,350 $342,194.27 Calculated using CRF x TCI

Total Annual Cost $882,336 $729,337 $830,337 $2,648,540 $1,025,853 Sum of DAC + IAC

1 Sargent & Lundy, IPM Model - Revisions to Cost and Performance for APC Technologies, Mercury Control Cost Development Methodology Final, March 2013