BAY AREA AIR QUALITY MANAGEMENT DISTRICT

939 ELUS STREET

SAN FRANCISCO, CA 94109

January 7, 1994

TO: CHAIRPERSON HILLIGOSS AND MEMBERS

OF THE BOARD OF DiRECTORS

FROM: AIR POLLUTION CONTROL OFFICER

SUBJECT: PROPOSED REGULATION 9, RULE 12: NITROGEN OXIDES

FROM GLASS MELTING FURNACES

EXECUTIVE SUMMARY

On January 19, 1994, the Board of Directors will consider adoption of proposed

Regulation 9, Rule 12: Nitrogen Oxides From Glass Melting Furnaces.

This proposed rule would implement Control Measure D6 of the Bay Area 1991

Clean Air Plan. The rule is one of a series of NOx control measures being

developed by the District. NOx reacts with VOCs to form ozone in the lower

atmosphere. When transported to downwind air basins, NOx contributes to

downwind ozone. The District is required to adopt NOx controls by both the

federal and state Clean Air Acts.

Adoption of the proposed rule:

— Establishes an emission limit of 5.5 lbs NOx per ton of glass produced.

— Affects three plants: Owens-Brockway Glass Containers in Oakland, Anchor

Glass Container in Antioch, and Anchor Glass Container in Hayward.

— Requires the three plants to make percentage reductions in NOx emissions

until they reach the 5.5 lb limit.

Reduces overall NOx emissions from this industry by about 25%, although

the Anchor plants have higher emissions and will make greater reductions.

— Minimizes the adverse economic impact of NOx control by allowing the

industry to coordinate installation of control equipment with normal furnace

rebuild schedules.

AFFECTED PUNTS

The affected glass plants all produce glass bottles, primarily for wine, beer, and

soft drinks. These plants also play a significant role in the recycling of glass in

the Bay Area. Each plant faces different problems in reducing NOx, and the rule

is structured to allow each plant to install appropriate NOx reduction technology

when furnaces are rebuilt in accordance with the plant’s normal rebuild

schedule.

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PROPOSED RULE

The rule establishes a target emission level of 5.5 lbs of NOx per ton of glass

produced. To reach that target, plants are required to reduce current NOx

emissions by 10% in 1997, by 25% in 1999, and by 45% in 2001. If the 5.5 lb

standard has not been achieved by 2001, the plants will have to make further

reductions until the 5.5 lb standard is reached.

Compliance with the rule will be monitored by source tests. The plants will be

required to establish baseline emission levels for each furnace by performing

sourcetests in accordance with District-approved specifications. Percentage

reductions are then to be made from this baseline. To demonstrate that the

mandated reductions have been achieved, the plants will a9ain perform source

tests and submit results to the District. As always, the District may also conduct

source tests to ensure the reliability of the data received.

EMiSSiON REDUCTlONS

The three plants affected by the proosed rule collectively emit about 5 tons of

NOx per day. The rule will reduce NOx emissions by 1.2 tons per day. This

represents a reduction of about 25% for this industry. The Anchor furnaces

have significantly higher NOx emission levels than the Owens-Brockway

furnaces, and will reduce emissions by about 45%.

COMPLIANCE COSTS

Costs of controllin9 NOx will vary from plant to plant, depending upon the

current level of emissions. The costs to Owens-Brockway will be lower because

its furnaces already come close to meeting the proposed standard. Anchor, on

the other hand, will have to install new technology, but can do so over time, as

NOx reductions are phased in. Anchor is also working on new NOx control

technology that will enable it to reduce the cost of reaching the 5.5 lb standard.

Costs of control for the proposed rule range from $1800 to $2400 per ton of NOx

reduced.

In light of the importance of these plants to local recycling and the history of

glass plant closures in the U.S., costs were carefully considered in connection

with the proposed rule. The proposed rule will maximize environmental benefits

by reducing NOx without threatening the existence of the Bay Area facilities.

ASSOCIATED IMPACTS

A socioeconomic analysis was performed for the proposed rule. This analysis

concludes that the rule would not create significant economic impacts on the

plants. According to the analysis, the plants could choose to make some minor

staff reductions to recoup the costs of NOx control, but it is more likely that they

will recoup costs with minor price increases.

Staff performed a CEQA Initial Study to determine whether the proposed rule

would have any impacts other than those analyzed in the Environmental Impact

Report prepared for the Bay Area 1991 Clean Air Plan. The CAP EIR and staff’s

Initial Study conclude that the proposed rule would have no significant adverse

environmental impacts.

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The rule is also not expected to significantly affect BAAQMD staffing needs since

compliance will be monitored primarily by source tests conducted by the plants.

RULE DEVELOPMENT HISTORY

- June 23, 1993. Workshop draft of rule completed. Draft rule proposed a

standard similar to South Coast Air Quality Management District (SCAQMD)

standard.

- July 30, 1993. Public workshop attended by representatives from Anchor

and Owens-Brockway, along with two consultants for the Glass Packaging

Institute. Major topics of discussion at workshop were: (1) difficulties in

applying various existing NOx control technologies to container glass

furnaces, (2) new NOx control technologies, (3) differences between

SCAQMD and BAAQMD furnaces and markets, (4) economic impacts of

control, and (5) alternative rule provisions proposed by industry.

- August 1993. Staff researched NOx control efforts in the SCAQMD and

outside California. Staff discussed issues with furnace engineers for most of

the major producers of container glass nationwide.

- September 1993. Staff revised the rule proposal following determination

that proposed standard would probably lead to plant closures.

— October 1, 1993. Staff mailed revised draft of rule to affected parties. Staff

received written comments from both Anchor and Owens-Brockway. These

comments resulted in minor changes to the rule and staff report.

October 22, 1993. Final proposed rule completed, public hearing notice

mailed.

CONCLUSION

A copy of Regulation 9, Rule 12: Nitrogen Oxides From Glass Melting Furnaces,

along with copies of the staff report, the socioeconomic impact analysis, and the

CEQA analysis are attached for your review.

Staff recommends adoption-of the proposed rule.

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STAFF REPORT

PROPOSED REGULATION 9, RULE 12

NITROGEN OXIDES FROM

GLASS MELTING FURNACES

EXECUTiVE SUMMARY

Proposed Regulation 9, Rule 12 is a retrojit rule designed to reduce nitrogen

oxides (NOx) emissions from glass melting furnaces. The rule would implement

Control Measure D6 of the Bay Aiea 1991 Clean Air Plan.

The proposed rule would affect three Bay Area container glass plants operating

a total of five furnaces, and would require specified percentage reductions in

NOx emissions from a baseline established for each furnace through source

testin9. No further reductions would be required after attainment of a target

emission limit of 5.5 lbs of NOx per ton of glass pulled from the furnace. The

rule specifres a 10% reduction from baseline NOx emissions effective January 1,

1997, a 25% reduction from baseline effective January 1, 1999. and a 45%

reduction effective January 1, 2001.

The estimated cost of complying with the proposed rule varies, depending on

the current emission level of the plant. TWo plants have emissions in the 9.0-

10.0 lb range, and have significantly farther to go than the third plant, which has

emissions in the 5.0-6.0 lb range. For the plants with higher emissions, the cost

of complying with the 10% reduction requirement and the 25% reduction

requirement is approximately $2000 per ton of NOx reduced. For these plants

to reach the 5.5 lb standard, emissions would have to be reduced by 45%, at a

cost of approximately $4000 per ton of NOx reduced. The plant with lower

emissions can meet the 5.5 lb standard with a 10% reduction in emissions, at a

cost of approximately $2400 per ton or less.

Whether the District should mandate reductions to 5.5 lbs or below, and by

when, were the central issues of this rulemaking effort. The current South Coast

Air Quality Management District (SCAQMD) limit dropped to 4.0 lbs on January

1, 1993 under a rule adopted in 1983. The Bay Area CAP and the workshop

draft of this rule proposed this same limit, effective January 1, 1997. At the

workshop and in numerous contacts after the workshop, industry presented

considerable technical and financial information which adequately demonstrated

to staff the following:

— The Bay Area furnaces differ in important design respects from most of

the South Coast furnaces, making some relatively low capital cost NOx

reduction techniques used on the South Coast furnaces unavailable

here.

The South Coast plants have been able to comply with the 4.0 lb

standard by usin9 these low-cost techniques in conjunction with a

production technique called electric boosting. Electric boosting can be

used either to replace some gas firing, thereby reducing NOx. or.

supplement gas firing, thereby increasing production.

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- The South Coast plants had 16 years from the beginning of the

SCAQMD rulemaking effort to the effective date ofthe 4.0 lb standard,

which allowed the plants to structure production so that electric

boostin9 reduced NOx. Bay Area plants used the technique to increase

production and can no longer use it to reduce NOx.

- Other technologies, upon which rulemaking efforts by ARB and

SCAQMD were based, have not worked for container glass furnaces

and are not options for the Bay Area furnaces.

-, The only technology currently avãflable to the Bay Area glassplants that

gives significant NOx reductions with good glass quality and proven

performance is a relatively new technology using 100% oxygen

combustion.

-. To reach 5.5 lbs in the near term (4-6 years). two of the three Bay Area

plants would have to install oxygen-fuel technology. To reach 4.0 lbs in

the near term, all three plants would have to install oxy-fuel technology.

- Because of the potentially high capital costs and high operating costs of

this technology, some or all of the plants would have to dose if required

to buy the technology in the near term.

Closure of the plants would not only have the obvious economic and

• social costs, but It might also have a net negative environmental impact

because of the significant role In glass recyding played by the plants.

The low-cost techniques available to the plants here will allow NOx

reductions of approximately 25%.

— New technologies that will reduce the cost of meetinQ a 5.5 lb limit, and

perhaps even lower fimits, will probably be available in the next 5-7

years.

Given these findings, staff chose to fundamentally restructure the earlier draft

rule. The essential thrust of the current proposal is to require the Bay Area

plants to use the low-cost technologies that are available to them now to begin

reducing NOx emissions toward a 5.5 lb target. By the time uncertainties about

oxy-fuel technology are resolved and other newer technologies are available, the

plants will be required to use these technologies to meet the 5.5 lb target

The plants have been willing to accept a requirement to meet a 5.5 lb target in

2001 that they could not afford to meet by 1997 because they are fairly certain

that developing technologies will significantly reduce the cost of achieving the

reduction by 2001. The proposed Board Resolution nevertheless indudes a

requirement that staff, by January 1, 2000, reevaluate the technical feasibility

and cost of meeting the 45% reduction target Staff would then bring any

necessary changes in the rule to the Board prior to the effective date for the

reduction.

BACKGROUND

NOx emissions result from the combustion of fossil fuels in the presence of air.

wThermal NOxa emissions are produced by high temperature combination of the

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nitrogen and oxygen in combustion air. It the fuel contains nitrogen

compounds, some of the fuel nitrogen may combine with atmospheric oxygen

to form fuel NOx. Since Bay Area glass plants bum natural gas, which

contains almost no nitrogen, nrtually all NOx emissions from the plants are

thermal NOx.

NOx emissions combine with VOCs (volatile organic compounds) in the

presence of sunHght to form ozone. Because NOx emissions contribute to

ground-level ozone formation, both the federal Clean Air Act Amendments of

1990 and the Cailfomia Clean Air Act indude certain mandates to control NOx.

Section 182(1) of the federal Clean Mr Act requires that state implementation

plans include NOx control measures for nonattainment areas, unless EPA

determines that net air quality benefits are greater in the absence of such

controls. Because District air quality modeling showed that NOx measures

would not benefit air quality within the District, the District submitted a request to

be exempted from the NOx requirements. In addition, the District has met EPA

criteria for redesi9nation as an ozone attainment area, and has submitted a

request forredesignation. Until EPA grants either request, however, the federal

NOx control requirements apply. The federal NOx requirements must be

implemented by May 31, 1995.

Even if the federal requirements were to disappear, the District remains a

nonattainment area for the state ozone standard and is subject to state

mandates. The California Clean Air Act requires ARB to identify air basins that

contribute to violations of the state ozone standard in downwind basins and to

develop mitigation measures. Under ARB regulations implementing this

requirement, the Bay Area must adopt NOx controls for source categories

accounting for 75 percent of the District’s NOx inventory

The glass plants that would be affected by this rule are currently the eleventh,

fifteenth, and twenty-second largest NOx sources in the District and coflectivety

emit about 5 tons of NOx per day. The larger Bay Area refineries and electric

power generating plants each emit about 10 tons of NOx per day. The total

stationary source NOx inventory was estimated to be 158 tons per day for 1991.

South Coast Rule

The model for the 1991 CAP control measure to be implemented by this rule

was South Coast Air Quality Management District (SCAQMD) Rule 1117. Rule

1117 is more stringent than the proposed rule, and currently requires South

Coast glass plants to meet a standard of 4.0 lbs NOx per ton of glass pulled.

After receiving significant industry input during the rule development process, it

became clear that the South Coast standard is not an entirely appropriate model

for this rule for three reasons. First, the South Coast rulemaking process for

Rule 1117 began in 1977. By the time the 4.0 lb standard took effect on January

1, 1993, glass plants had 16 years to prepare to meet the standard and had

been meeting an interim 5.5 lb standard for 6 years. Second, the furnaces in

the Bay Area differ in significant design respects from those in the South Coast.

Third, many of the technologies upon which the SCAQMD rule was premised

have not proved viable for container furnaces.

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Glass Industry

In the U.S., the last new container glass plant was built in 1980. Since 1980, 4.3

of the 115 plants then in existence have been peiTnanently dosed. There are

now 11 container glass plants in California: five plants in the SCAQMD, three in

the San Joaquin Valley Unified APCD, and three in the BMQMD (Glass

International). In California there have been a number of plant dosures in

recent years. In the SCAQMD, there have been three closures since the

passage of Rule 1117, with one occurring last year. In the Bay Area, there have

been two plarjt dosures in the last two ye4rs: the Owens-Brockway south plant

in Oakland in 1992, and the Anchor (formerly Latchford) plant in San Leanciro in

.1991.

Recycling

The Bay Area plants currently produce about 1200 tons of glass per day.

Approximately 30% of batch material is recycled glass. This represents an

annual consumption of approximately 130,000 tons of recycled glass.

According to California Senate estimates, about 40 million tons of municipal

solid waste are generated each year in California. Glass represents about 10%

of this total. Given that the Bay Area’s population Is about 18% of the state total,

it Is assumed that the Bay Area sends about 720,000 tons of glass to landfills

per year. Recycled glass used by the Bay Area plants is therefore equal to 18%

of the amount sent to Bay Area landfills.

AFFECTED FACIUTIES

The proposed rule applies to lar9e glass melting furnaces. Three container

glass plants currently operating in the District would be subject to the rule.

Anchor Glass Container Corporation operates two plants: one In Antioch and

one in Hayward. Each Anchor plant has one glass melting furnace capable of

producing approximately 300 tona of container glass per day. Owens-Brockway

Glass Container operates a plant in Oakland with three furnaces, collectively

capable of producing rou9hly 800 tons of container glass per day. These three

plants are the only plants identified as subject to the proposed rule. -

The rule contains two exemptions. The first exemption (Section 9-12.110.1) is

for electric melting furnaces. Although electric melting furnaces may produce

some NOx if niter (sodium nitrate) is added to the glass batch, NOx emissions

are generally insignificant The only large electric furnace in the District is

operated by Owens-Coming Fiberglass in Santa Clara. This furnace would not

be subject to the rule.

FUrnaces producing 4550 kg (5 short tons) of glass per day or less are

exempted (Section 9-12-110.2). Any furnaces this small would produce

insignificant NOx emissions. Staff has been unable to identify any specific

furnaces that would be exempted by this provision, but the exemption is

intended to apply to small art glass or other handmade glass operations.

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