1

MEMORANDUM

TO: Hillary Ward, U.S. Environmental Protection Agency, OAQ PS/Sector Policies and

Programs Division, Fuel and Incineration Group

FROM: Eastern Research Group, Inc. (ERG)

DATE: June 2015

SUBJECT: Updated Methodology for Estimating Cost and Emission Impact s of MSW Landfill

Regulations

Introduction

The EPA is reviewing the new source performance standards (NSPS) and emission guidelines (EG) for municipal solid waste (MSW) landfills. Currentl y, the regulations require landfills of at least 2.5 million megagrams (Mg) and 2.5 million cubic meters in desi gn capacity with estimated nonmethane organic compounds (NMOC) emissions of at least 50 megagram s (Mg) per year to collect and control landfill gas (LFG). As part of the proposed revisions, a M icrosoft ® Access database was developed to calculate the cost and emission impacts associated with varying certain control parameters and applying these parameters to a dataset of existing and model future l andfills. The development of the dataset is

discussed in other memoranda. 1 The purpose of this memorandum is to summarize the method ology for

the evaluations.

1. General Assumptions

The emission reductions and costs associated with the re quirements of the current rule are considered the baseline and each alternative was compared to this baseline. All existing landfills that accepted waste after November 1987 2 as well as future landfills that are predicted to open or modify in the 5-year period of January 2014 through December 2018 are included in the analysis. Annual estimates

of emission reductions and costs were estimated for eac h landfill and alternative control scenario in year 2025. Costs were estimated using both a 7 percent and 3 perce nt interest rate.

The alternatives differ from the baseline by variations in the emission rate thresholds and the design capacity thresholds. Shorter lag times were only eva luated for wet landfills as discussed in another

memorandum. 3 A description of each variable is presented below:

• The emission rate threshold in the current rule is 50 Mg per year NMOC. The alternati ves include lower NMOC thresholds.

1 ERG. 2014. Summary of Landfill Dataset Used in the Cost a nd Emission Analysis of Landfill Regulations; ERG. 2015. Summary of Updated Landfill Dataset Used in the Cost and E mission Reduction Analysis of Landfills Regulations. 2015.

2 The designated facility under the EG is each existing MS W landfill that has accepted waste since November 8, 1987 and for which construction, reconstruction, or modific ation was commenced on or before July 17, 2014.

3 ERG. 2015. Revised Cost and Emission Impacts Resulting from the Landf ill EG Review.2

• The design capacity threshold in the current rule is 2.5 million Mg and 2.5 million cubic met ers. Other landfill design capacity thresholds were evaluated a s alternatives.

• The initial lag time is the time period between when the landfill exceeds the e mission threshold and when GCCS are required to be installed. The curren t rule allows a 30-month initial lag time, which was modeled as a 3-year lag time since the first-or der decay equation used to model emissions is on an annual, instead of monthly, basis. Furt her, because the current rule requires annual NMOC emission reports to be submitted by 6 months i nto the following calendar year, the landfill would get 30 months after the submittal of its fi rst NMOC emission report showing an exceedance to install the GCCS, which is approximately 36 m onths after the excess emissions occurred. Shorter initial lag times were examined among the alternatives.

• The expansion lag time is the amount of time allotted for the landfill to expand the GCCS into waste being placed in new areas of the landfill. The curr ent rule allows 2 years after initial waste placement in closed areas and 5 years after initial was te placement in active areas of the landfill; so the actual lag time varies by landfill depending how quic kly expansion areas are filled and closed. Based on input received during public outreach, most modern large landfills do not reach final grade within 2 years and a majority of landfills a re complying with the 5 year provision. Therefore, a 4-year expansion lag time was assumed to repr esent the baseline. A shorter lag time

was examined as an alternative.

2. Estimating Emission Impacts

2.1 Waste Estimates

First, the quantity of waste maintained in each landfi ll was estimated for each year of the analysis,

based on one of two methods:

1. For landfills reporting to GHGRP:

a. Historical annual waste acceptance rate (AWAR) data be ginning with the year the landfill opened through 2013 were generally available in GHGRP data ta bles ‘HH_ANN_WASTE_DISPOSAL_QTY’ and ‘HH_HIST_YR_WASTE_QTY’. The se data were used to compute cumulative waste-in-place (WIP) amo unts for each year of the model.

b. If data were missing for 2012 or 2013 reporting years at open l andfills, the last known year’s AWAR was used to fill data gaps.

c. To estimate future year AWAR for landfills open past 2013, o ne of four methods was used:

i. For landfills with calculated 2013 WIP less than reporte d landfill capacity: AWAR = (Design Capacity - 2013 WIP)/(Estimated landfill closure y ear - 2013)

ii. For landfills with calculated 2013 WIP greater than or equal to reported landfill capacity:

AWAR = 2013 AWAR

iii. For landfills with calculated future AWAR greater tha n 10% of the 2013 AWAR:

AWAR = 2013 AWAR

iv. For landfills with 2013 AWAR = 0, future annual AWAR = 0.

2. For other landfills that were not GHGRP reporters, the l andfill waste data were calculated one of
two ways:

a. When a landfill’s AWAR and WIP values were available i n the landfill dataset and associated with a particular year, those values were extrapolated to estimate the landfill’s AWAR and WIP for each year. This estimation method was designated Option A in the database table of Calculated Inputs_Annual Waste.3 • When a Landfill_WIP and Landfill_WIP_Year are reported, t he AWAR up until the
Landfill_WIP_Year is estimated based on the following rel ationship:
AWAR = Landfill_WIP / (Landfill_WIP_Year - Landfill _Year_Open+1).

• The AWAR after the Landfill_WIP_Year is based on the fol lowing relationship:
AWAR = (Landfill_Design_Cap_tons - Landfill_WIP) / (Landfill_Closure_Y ear - Landfill _WIP_Year+1).

2. When WIP and AWAR values were not available in the landf ill dataset, the AWAR was
estimated using the landfill open and closure years and the landfill capacity and assuming a

constant AWAR over the lifetime of the landfill. This es timation method was designated
Option D in the database table of Calculated Inputs_Annual Was te.

• AWAR = Landfill_Design_Cap_tons / (Landfill_Closure_Year - Landfill _Year _Open+1)
Next, the annual WIP was calculated by summing the AWAR over time.

2.2 Emission Equations

After the annual quantity of waste was estimated for ea ch landfill, a first order decay equation (Equation 1) was used estimate annual methane emissions fr om each landfill for each year. The dataset

includes annual emission estimates for 2014-2039.

Eq. 1 : kt 0 t 4 e

M L k CH −

× × × =

Where:

CH 4t

= Methane, ft 3 in year t k = Methane generation rate, year -1

L 0 = Potential methane generation capacity, ft 3 methane per ton M = Mass of waste accepted in year t, tons t = Analysis year (year 1 through 50), year

The volume of LFG produced by a landfill was estimate d using Equation 2.

Eq. 2 : LFG t

= CH 4t × 2

Where:

LFG t

= Landfill gas, ft 3 in year t

CH 4t = Methane, ft 3 in year t 2 = Multiplier to convert methane to LFG (assuming that LF G is 50 percent

methane), unitless

The mass of NMOC emissions produced by each landfill was estimated based on the amount of LFG produced at the landfill, as shown in Equation 3.

Eq. 3 : NMOC t

= LFG t ÷ 35.32 × 595 × 3.6E -9

Where:

NMOC t

= NMOC in year t, Mg in year t

LFG t = Landfill gas, ft 3 in year t 35.32 = Conversion, ft 3 per m 34

595 = Concentration of NMOC in LFG, ppm NMOC by volume as hexa ne 3.6E-9 = Conversion factor, Mg NMOC per m 3 LFG

The mass of methane emissions produced by each landfill was estimated based on the volume of methane produced at the landfill, as shown in Equation 4a.

Eq. 4a : Mg CH 4 = CH 4t

× 0.0423 ÷ 2000 ÷ 0.90718

Where: Mg CH 4 = Methane in year t, Mg in year t

CH 4t

= Methane, ft 3 in year t (From Equation 1) 0.0423 = Density of methane, lb per ft 3
2000 = Conversion, lb per short ton 0.90718 = Conversion, short ton per Mg

The mass of methane emissions, in terms of carbon dioxide e quivalents, produced by each landfill was estimated using the Equation 4b.

Eq. 4b : Mt CO 2 eq = Mg CH 4 × GWP CH4

Where:

Mt CO 2 eq t = Methane emissions as carbon dioxide equivalents, Mt in year t 4
Mg CH 4t

= Methane, Mg in year t (From Equation 4a)

GWP CH4 = 25, Global Warming Potential of Methane

2.3 NSPS/EG and AP-42 Default Values for Calculating Emissions 5

The current NSPS requires the use of Tier 1 default value for the potential methane generation capacity (L 0 ) and methane generation rate (k) to determine when the landf ill exceeds the 50 Mg NMOC per year emission rate threshold. The NSPS L 0 is equal to 5,458 ft 3 methane per ton of waste and the NSPS k values are 0.05 per year for areas receiving 25 in ches or more of rainfall per year and 0.02 per year for areas receiving less than 25 inches of rainfall. While the NSPS offers a conservatively high Tier 1 default NMOC concentration, the regulations allow the use of Tier 2 tests to determine NMOC concentration. (Many landfills have conducted Tier 2 tests and gotten values that are consistent with the AP-42 average NMOC concentration of 595 ppmv.) Therefore, the combination of the Tier 1 defaults for

k and L 0 and the NMOC concentration of 595 ppmv were used to represen t how landfills currently calculate NMOC emissions to determine if they have to inst all controls under the NSPS. Because the use

of these values result in estimates of LFG and NMOC that are in accordance with the current NSPS; in

this evaluation these estimates were called LFG NSPS/EG and NMOC NSPS/EG . NSPS defaults tend to overestimate actual emissions at most landfills (due to the conservatively high L 0 and k values).

EPA has collected and compiled available emission factor data for landfills in the report Compilation of Air Pollutant Emission Factors (AP-42). 6 The AP-42 L 0 is equal to 3210 ft 3 methane per ton of waste. The AP-42 k values are 0.04 per year for are as receiving 25 inches or more of rainfall per year and 0.02 per year for areas receiving less than 25 inches of rainfall. The use of these values, in

4 A megagram is equal to a metric ton.

5 The modeling requirements for existing sources under the st ate and federal plans implementing the EG are similar

to those for new and modified sources under the current NS PS.

6 USEPA AP-42, Fifth Edition, Volume I Chapter 2: Solid W aste Disposal. http://www.epa.gov/ttn/chief/ap42/ch02/index.html5

combination with the NMOC concentration of 595 ppmv, result in estimates of LFG and NMOC that are in accordance with the AP-42; in this evaluation these es timates were called LFG AP-42 and NMOC AP-42

.

As previously mentioned, for this evaluation, LFG NSPS/EG and NMOC NSPS/EG

were used to

determine when landfills would install controls. To determ ine when landfills may remove controls, the

current rules allow landfills to measure the actual collec ted gas flow rate as well as the concentration (instead of relying on Tier 1 default L 0 and k defaults). Because the AP-42 values for L 0 and k produce results that more closely match actual gas flow rates and emissions, LFG AP-42 and NMOC AP-42 were used in this analysis to determine when landfills would remove controls.

Landfill-Specific k Factors

As noted above, the k values depend on the amount of precipita tion at the landfill. For this evaluation, long-term precipitation data by county are availa ble for most landfill locations. 7 Some

landfills in remote areas or U.S. Territories did not h ave data available and data from nearby weather stations from the National Oceanic and Atmospheric Admini stration (NOAA) were obtained and averaged over the available data period for each location. 8 The k factors were assigned to each landfill based on the resulting amount of precipitation at each l andfill.

2.4 Emission Reductions

To estimate emission reductions, the amount of LFG, me thane, and NMOC emitted at each landfill was estimated using the equations in Section 2.1. After the emissions at each landfill exceed the NMOC emission rate threshold of each control scenario, the mode l assumed that the collection equipment was installed and operational at the landfill after the init ial lag time of the control scenario. For example, if t he landfill exceeded the NMOC emission threshold in year 1, an d the initial lag time was 3 years, the landfill would begin collecting gas in year 4. As the landfill was filled over time, the model assumed the landfill would expand the GCCS into new areas of waste placement i n accordance with the expansion lag time of the control scenario. If the landfill was not expanding the g as collection system (i.e., by installing wells in new areas of waste placement) every year, the landfill ma y have produced more emissions than could be collected until the gas collection system was expanded.

Once the landfill reached the maximum gas production and t he gas production started to decrease, the analysis assumed that the GCCS would collect all of the emitted gas. To determine the amount of LFG, methane and NMOC collected, the analysis used the LFG AP-42 and NMOC AP-42, estimates with the appropriate lag times. This was the best estimate of actual gas collected. See Table 1 for an example of the collected gas estimate at a landfill where the initial lag time was 3 years and the expansion lag time was 4

years.

Table 1. Example of Collected NMOC Estimate at a Landfill with an Initial Lag Time of 3 Years and an Expansion Lag Time of 4 Years

Year NMOC NSPS/EG NMOC AP-42 Collected NMOC

1 50.2 27.7 0.0

2 50.4 27.9 0.0

3 50.6 28.0 0.0

4 50.8 28.2 28.2

5 51.0 28.3 28.2

7 Prism Climate Group. 30-year Normals (1981-2010). http://www.prism.oregonstate.edu/normals/

, Accessed September 2015.

8 NOAA climate division data are available online at: http://www.ncdc.noaa.gov/cdo-web/6 6 51.1 28.5 28.2

7 51.3 28.6 28.2

8 51.5 28.7 28.7

9 51.6 28.9 28.7

10 51.7 29.0 28.7

11 51.9 29.1 28.7

12 52.0 29.2 29.2

13 52.1 29.3 29.2

14 52.2 29.4 29.2

15 52.3 29.5 29.2

The emission reductions are equal to the amount of collect ed NMOC and methane that is combusted. The amount of collected NMOC and methane destroye d by combustion controls was estimated by multiplying the amount of collected gas by a destructi on efficiency of 98 percent. The 98 percent destruction efficiency accounts for the fact that combusti on is not 100 percent efficient.

3. Cost Equations

The cost equations used in this regulatory evaluation were derived from EPA’s Landfill Gas Energy Cost Model (LFGcost-Web), version 3.0, which was develo ped by EPA’s Landfill Methane Outreach Program (LMOP). LFGcost-Web estimates costs for gas collection, flare and energy recovery systems and was developed based on cost data obtained from e quipment vendors and consulting firms that have installed and operated numerous gas collecti on and control systems. LFGcost-Web encompasses the types of costs included in the EPA Office of Air Q uality Planning and Standards (OAQPS) Control Cost Manual including capital costs, annual costs, and re covery credits. Total capital costs include purchased equipment costs, installation costs, engineering and design costs, costs for site preparation and buildings, costs of permits and fees, and working capital. Total annual costs include direct costs, indirect costs, and recovery credits. Direct annual costs are tho se that are proportional to a facility-specific metrics such as the facility’s productive output or size. Indirect a nnual costs are independent of facility-specific metrics and may include categories such as administrative charges, taxes, or insurance. Recovery credits are for materials or energy recovered by the control syste m.

For this evaluation, all costs are presented in 2012$. The costs included in LFGcost-Web are in 2013$ and were adjusted to 2012$ using a factor of 2 percent for capital costs and 2.5 percent for O&M

costs.

The analysis presents the annualized capital cost of fla res, wells, wellheads (including piping to collect gas) and engines over the lifetime of the equipment. It was assumed that the equipment would be replaced when its lifetime was over, so the annualized ca pital costs were incurred as long as the landfill still had controls in place. In order to calculate the a nnualization factors, it was assumed that flares, well s, well heads, and engines had a 15-year lifetime. In addition , there was a mobilization/installation charge to bring well drilling equipment on site each time the gas collection system was expanded. Because the landfill would be drilling wells to expand the control syst em during the expansion lag year, it was assumed that this capital installation cost had a life time equal to the expansion lag time.

A number of the capital costs equations depend on the numb er of wells at each landfill. In order to estimate the number of wells at each landfill, the number of acres that have been filled with waste fo r each landfill for each year were estimated. For landfi lls not reporting a GCCS area to GHGRP, it was assumed that the percent of design area filled (acres ) would track the ratio of waste in place/design capacity (e.g., if a landfill had a waste-in-place a mount equivalent to 40 percent of design capacity, then 40 percent of the planned acreage would be filled). For GHGR P landfills who reported a GCCS area (as7

discussed in section 2.3 of another memorandum) 9 this value was compared to the calculated area based on ratio of waste in place/design capacity discussed above. The maximum of the reported value or this calculated area was used as the starting point for an es timated GCCS area in year 2014, and that area grew overtime, tracking the ratio of waste in place/design capac ity. In addition, it was assumed that each landfill would install one well per acre, consistent wit h the guidelines provided in the LFGcost-Web model, and that the number of wells would increase per iodically based on expansion lag time. See Table 2 for an example of the number of wells estimated annually at a landfill where the initial lag time is 3 years and the expansion lag time is 4 years.

Table 2. Example of Number of Wells at a Landfill with an Initial Lag Time of 3 Years and an Expansion Lag Time Equal to 4 Years (and the landfill reac hes the emission rate threshold in year 1)

Year Acreage Number of Wells

1 98.2 0

2 102.9 0

3 107.5 0

4 112.1 112

5 116.8 112

6 121.4 112

7 126.1 112

8 130.7 131

9 135.4 131

10 140 131

11 140 131

12 140 140

13 140 140

14 140 140

15 140 140

3.1 Capital Costs

The equations used in this evaluation to calculate capita l costs for flares, wells, wellheads (including gas collection piping), mobilization/installa tion, and engines are presented below. All costs equations are shown on an individual landfill and year basis.

Flare Capital Costs

Flares are the primary control device used at landfills. A ll landfills required to comply with the

control scenario were assumed to install flares. Landf ills using engines were assumed to have flares as the back-up control device for periods when the engines are not operat ing. The capital flare costs were estimated using the equation below, which was based on the in stalled cost of the knockout, blower, and flare system as determined in LFGcost-Web. The flares were sized based on the maximum LFG flow rate over the 15-year flare lifetime, which could be as late a s 2039 for projects that were expected to begin operation in 2025.

Eq. 5 : 1 61.0

max 15yr

y 15, capital 

### ) 02.1( 600 ,4 525,600 LFG

z Flare

− 

### × ×        

× =

9 Summary of Updated Landfill Dataset Used in the Cost and E mission Reduction Analysis of Landfills Regulations.

2015.8

Where:

Flare capital = Installed annualized cost of knockout, blower, and flare system, 2012$

z 15,y = Annualization factor where x=15 yrs and y=interest rate (0.07 or 0.03),

unitless

LFG 15yrmax = Maximum LFG collected for 15 year project period, ft 3 per year 525,600 = Conversion factor, minutes per year $4,600 = Installed capital cost of knockout, blower, and flare system, 2013$ per

ft 3 /min LFG (1.02) -1 = Adjustment from 2013$ to 2012$, unitless 10

Vertical Gas Extraction Well Capital Costs

The vertical gas extraction well capital costs were base d on a dollar per linear foot of well depth installed estimate from LFGcost-Web. As shown in the equa tion below, wells were assumed to have a depth of 10 feet less than the landfill depth. The method used to estimate the number of wells at the landfill each year is described above.

Eq. 6 : Well capital = z 15,y

× (Depth – 10) × 85 × Wells annual × (1.02) -1

Where:

Well capital = Installed annualized cost of vertical wells, 2012$

z 15,y = Annualization factor where x=15 yrs and y=interest rate (0.07 or 0.03),

unitless Depth = Landfill waste depth, feet

10 = feet $85 = Installed capital cost of one vertical well, 2013$ per fo ot of well depth

Wells annual = Number of vertical wells operated each year (1.02) -1 = Adjustment from 2013$ to 2012$, unitless

Wellhead Capital Costs

The capital wellhead cost covered the equipment associated with each well, including the wellhead and pipe gathering system (and any additional fitti ngs/installations connecting the wells, and was dependent on the number of wells. In addition, this ca pital cost encompasses engineering, permitting, and surveying fees associated with the wellfield install ation that are also dependent on the number of wells. The capital wellhead costs at each landfill wer e estimated using a dollar per well installed cost from LFGcost-Web for wellheads, pipe gathering system, engineeri ng, permitting, and surveying and the

number of wells at each landfill.

Eq. 7 : Wellhead capital = z 15,y × 17,700 × Wells annual × (1.02) -1

Where:

Wellhead capital = Installed annualized cost of wellheads, 2012$

z 15,y = Annualization factor where x=15 yrs and y=interest rate (0.07 or 0.03),

unitless $17,700 = Installed capital cost of one wellhead, 2013$ per well

Wells annual = Number of wells operated each year

10 Equation uses a formula of (1+inflation rate/100) t , where capital cost escalation is assumed to be 2 perc ent and t is equal to -1 year9

(1.02) -1 = Adjustment from 2013$ to 2012$, unitless

Mobilization/ Installation Costs for Wellfield Expansion

The cost occurs upon installation of a new gas collection system (i.e., wellfield) and each time the wellfield was expanded into new areas of the landfill, so the frequency was dependent on the expansion lag time. This cost was independent of the number of wel ls being added. It included costs such as planning, set-up, and mobilization costs to get the well dr illing rig and pipe crew on site. This cost was estimated using the following equation from LFGcost-Web:

Eq. 8 : Installation capital = z x,y × 20,000 × (1.02) -1

Where:

Installation capital = Mobilization/installation annualized cost, 2012$

z x,y = Annualization factor where x=expansion lag time in yrs a nd y=interest

rate (0.07 or 0.03), unitless $20,000 = Mobilization/Installation costs, per occurrence, 20 13$ (1.02) -1 = Adjustment from 2013$ to 2012$, unitless

Engine Capital Costs

Engines were assumed to be installed only at landfills tha t produced enough LFG to power the engine and only when the electricity buyback rates allowed the o peration of the engine to be profitable. Standard engines used at landfills have approximately 1 MW capacity, which equates to 195 million ft 3
per year of collected LFG (at 50 percent methane). Therefo re, engines were assumed to be installed at

landfills that had at least 195 million ft 3 per year of collected LFG for at least 15 years, which could be as late as 2039 for engines there were installed in 2025.

The engine capital and operation and maintenance (O&M) e quations were calculated and summed to determine at what electricity buyback rate an eng ine would be profitable. The profitable electricity buyback rate was greater than $0.0594 per kWh at a 7 percent interest rate and greater than $0.0430 per kWh at a 3 percent interest rate; it was assume d engines were only installed in States with buyback rates exceeding those values.

Multiple engines may be present at a landfill when there i s sufficient gas flow to support additional engines. As noted above, one engine required 195 million ft 3 per year of collected LFG. To have two engines on site, the landfill must have had double tha t amount of LFG (390 million ft 3 per year) for at least 15 years after the project start date, whic h could be as late as 2039 for projects starting in

2025.

The capital costs for engines were based on the capital co sts for standard reciprocating enginegenerator sets in LFGcost-Web. These costs included gas com pression and treatment to remove particulates and moisture (e.g., a chiller), reciprocating engine and generator, electrical interconnect equipment, and site work including housings, utilities, and total facility engineering, design, and permitting.10 Eq. 9 : Engine capital = z 15 ,y, y × 2,650,000 × (1.02) -1 × Engine multiplier

Where: Engine capital = Installed annualized cost of engines, 2012$

z 15,y = Annualization factor where x=15 yrs and y=interest rate (0.07 or 0.03),

unitless $2,650,000 = Installed capital cost of one reciprocating engine- generator set, 2013$ per

engine (1.02) -1 = Adjustment from 2013$ to 2012$, unitless Engine multiplier = Number of engines needed

3.2 Operation and Maintenance (O&M) Costs

The equations used in this evaluation to calculate O&M c osts for flares, wells, electricity, and engines are presented below. All cost equations are shown on an individual landfill and year basis. These costs for all landfills were summed by year and the re sulting annual sums were used to estimate NPV

costs. To accurately estimate annual electricity costs and e ngine revenue from the generation and sale of electricity, two electricity prices were needed. Landfi lls must purchase electricity to operate the blowers used to collect LFG. EPA used 2012 commercial average retail electricity prices by State from the U.S. Energy Information Administration (EIA) to estimate elect ricity purchase prices at the landfill 11

.

Landfills utilizing engines generate revenue from the sale of the LFG-produced electricity. The amount of revenue generated depends primarily on the buyback r ate negotiated between the landfill (or third party developer) and the electric company purchasing the LFG-generated power. Average (mean) wholesale prices for each State were calculated using 2012 r esale generation and revenue data from EIA to estimate electricity buyback rates 12 . These wholesale prices generally fit in the range of ty pical buyback prices for LFG of $0.025 - $0.11/kWh, as discussed in LM OP’s Project Development

Handbook. 13 Additionally, LFGcost-Web uses a default buyback rate of $0. 06/kWh and the U.S. average of the wholesale prices used is $0.0655/kWh.

EIA wholesale data were not available for three States (HI, RI, & WV). For these States, electricity purchase price data from EIA were used to es timate buyback rates 14 . The buyback rates were estimated by first determining the ratio of each State’s purchase price to the overall average U.S. purchase price. This ratio was then multiplied by the calculated average U.S. wholesale price to estimate a buyback rate. Electricity price data for the U.S. territories of Guam, Puerto Rico, and the Virgin Islands were not found. Therefore, EIA profile analyses for these thre e territories were used to escalate U.S. average price s to estimate electricity prices for each island 15

.

Flare O&M Costs

11 U.S. DOE/EIA. Electricity: Detailed State Data, Annua l Data for 2012. Average Price by State by Provider (EIA861), 1990-2012. Released November 12, 2013. http://www.eia.gov/electricity/data/state

12 U.S. DOE/EIA. Electric power sales, revenue, and energy efficiency Form EIA-861 detailed data files. 2012 Operational Data (Formerly File 1). Released October 29, 20 13. http://www.eia.gov/electricity/data/eia861

13 U.S. EPA LMOP Chapter 4 of Project Development Handbook. http://epa.gov/lmop/documents/pdfs/pdh_chapter4.pdf

14 U.S. DOE/EIA. Electricity: Detailed State Data, Annua l Data for 2012. Average Price by State by Provider (EIA861), 1990-2012. Released November 12, 2013. http://www.eia.gov/electricity/data/state

15 U.S. DOE/EIA. Territory Profile and Energy Estimate s (for Guam, Puerto Rico, and the U.S. Virgin Islands). Profile Analysis, Electricity. December 18, 2013. http://www.eia.gov/state11

An estimate of the flare O&M costs from LFGcost-Web w as used to estimate the flare annual costs, as shown in the equation below:

Eq. 10 : Flare O&M = 5,100 × (1.025) -1

Where:

Flare O&M = Flare annual O&M costs, 2012$ $5,100 = Annual O&M flare cost, 2013$ (1.025) -1 = Adjustment from 2013$ to 2012$, unitless 16

Well O&M Costs

An estimate of the O&M costs for vertical gas extracti on wells from LFGcost-Web was used to estimate the well annual costs, as shown in the equation bel ow:

Eq. 11 : Well O&M = 2,600 × Wells annual × (1.025) -1

Where:

Well O&M = Well annual O&M costs, 2012$ $2,600 = Annual O&M well costs, 2013$ per well

Wells annual = Number of wells operating each year (1.025) -1 = Adjustment from 2013$ to 2012$, unitless

Electricity O&M Costs

The electricity cost of operating the blowers was calc ulated using the electricity usage of blowers from LFGcost-Web and the electricity purchase price.

Eq. 12 : Electricity O&M = 0.002 × Electricity purchase × LFG collected

Where: Electricity O&M = Electricity annual O&M costs, 2012$ 0.002 = Electricity usage by blowers, kWh per ft 3 LFG Electricity purchase = Electricity purchase price, 2012$ per kWh

LFG collected = Amount of LFG collected, ft 3 per year

Engine O&M Costs

For landfills with engines installed, the O&M costs of the engine were estimated using the annual costs for standard reciprocating engine-generator sets from LFGcost-Web, and taking into account the amount of time that the engine was operating each year ( assumed gross capacity factor in LFGcost-Web for engines) and the number of engines on site.

Eq. 13 : Engine O&M = 0.025 × 1,000 × 8,760 × 0.93 × (1.025) -1 × Engine multiplier

Where: Engine O&M = Engine annual O&M costs, 2012$ 0.025 = Annual O&M engine cost, 2013$ per kWh

16 Equation uses a formula of (1+inflation rate/100) t , where O&M cost escalation is assumed to be 2.5 percen t and t is equal to -1 year.12

1,000 = Amount of electricity as kW produced by a 1 MW engine, kW per engine 8,760 = Conversion factor, hours per year 0.93 = Fraction of time that the engine is online, unitless (1.025) -1 = Adjustment from 2013$ to 2012$, unitless Engine multiplier = Number of engines

Engine Revenue Costs

For landfills with engines installed, the revenue of the electricity produced by the engines was calculated using the equation below. This equation assumed t hat all electricity generated was sold to the grid (instead of some of the electricity generated being used to power the GCCS).

Eq. 14 : Engine

revenue = 1,000 × 8,760 × 0.93 × Electricity buyback × Engine multiplier

Where: Engine

revenue = Engine annual revenue, 2012$ 1,000 = Amount of electricity as kW produced by a 1 MW engine, kW per engine 8,760 = Conversion factor, hours per year 0.93 = Fraction of time that the engine is online, unitless Electricity buyback

= Electricity buyback rate, 2012$ per KWh Engine multiplier = Number of engines

4. Summary

This memorandum summarizes the emission reduction and co st equations used to evaluate the cost and emission impacts of various control scenarios considered under the review of the NSPS and EG. The EPA determined which landfills met the design capacity and emission rate thresholds for each regulatory option, then calculated the emission reductions and costs for each landfill in 2025 under each control scenario using the equations described in this memor andum. The results of applying this methodology to the landfills dataset are discussed in other memoranda and are detailed in the database. 17,

18, 19, 20

17 ERG. 2015. Updated Cost and Emissions Impacts Resulting from the Landfills NSPS Review.

18 ERG. 2015. Modeling Database Containing Inputs and Results of S upplemental Proposal for MSW Landfill

NSPS.

19 ERG. 2015. Revised Cost and Emission Impacts Resulting from the Landfill EG Review.

20 ERG. 2015. Modeling Database Containing Inputs and Results for Proposed Review of the MSW Landfill

Emission Guidelines.