P 0. Box 52025 Mail Station: PAB352 Phoenix, AZ 85072-2025 Direct Phone: (602) 236-2968 (602) 236-5900 Fax.' (602) 236-3407 E-mail: Kevin.wanttaja@srpnet.com www.srpnet.com 

### FEDEX OVERNIGHT July 29, 2008 

# RECEIVED Ms. Deborah Jordan, Air Division Director 

## JUL 3 0 2008 USEP A Region 9 Mail Code: AIR-l Air Division,AIR-**.~** 

### 75 Hawthorne Street U.S. EPA, REGION 9 

### San Francisco, CA 94105 

### Re: BestAvailable Retrofit Technology (BART) Analysis

- Cost Information Navajo Generating Station Dear Ms. Jordan: This letter provides an initial response to your information request letter dated July 1, 2008. Specifically, this letter responds to the information requests entitled "Cost of Compliance" and "Total Capital Costs of NOx Control Options". Salt River Project (SRP) will be submitting an updated BART analysis for the Navajo Generating Station (NGS) that will address all issues within the July 15t 

### letter; however, we are providing information related to these issues prior to our complete submittal as your staffhas requested. Cost ofCompliance EPA requested that SRP provide additional documentation, explanation, and justification for the cost estimates provided for the three nitrogen oxide (NOx) control options. For the 10w-NOx burner (LNB)/separated overfire air (SOFA) systems, the cost for each system was assumed to be $10 million in the analysis. This value was a high-level budgetary estimate based on initial discussions with major LNB/SOFA equipment suppliers. Now that more research into the costs associated with LNB/SOFA systems has been accomplished, SRP is finding that the actual total capital cost per unit is closer to $14 million. For the selective catalytic reduction (SCR) and selective non-catalytic reduction (SNCR) systems, the cost estimates were based on a cost study performed by Sargent & 

### Lundy. A copy ofthis analysis is attached to this letter. As you will see when comparing this information to the BART analysis previously submitted, the costs do not match for all scenarios. The Sargent & 

### Lundy report is correct, and the revised BART analysis will be updated to reflect the correct values. The correct total capital costs and annual operation and maintenance costs for each scenario are summarized in the following table.



### sc136030708Ms. Deborah Jordan, Air Division Director July 29, 2008 Page 2 of2



### Control Option Control Technology Total Capital Cost* ($) 

### Annual Operation & Maintenance Cost ($/yr) 

### II 

### Alt. 1 LNB/SOFA (Units 1-3) 30,000,000 0 2 LNB/SOFA & 

### SNCR (Units 1-3) 60,000,000 15,978,000 3 LNB/SOFA (Unit 2) LNB/SOFA & 

### SCR (Units 1 & 

### 3) 406,000,000 8,316,000 4 LNB/SOFA & 

### SCR (Units 1-3) 660,000,000 12,474,000

. . .. 

### * As noted In this letter, actual costs for the LNB/SOFA systems are anticipated to be closer to $14 million per unit. This would increase all total capital cost figures provided in this analysis by an additional $12 million. 

### Total Capital Costs ofNO x 

### Control Options EPA requested that SRP provide justification for the NO x 

### control option estimates, and explain why the connections would not be scheduled to coincide with scheduled unit outages. Cost estimate information is provided in the response to the issue above. With regards to why the connections would not be scheduled to coincide with scheduled unit outages, this information also is included in the Sargent & 

### Lundy cost study (i.e., the cost basis and the time required). As the study states, the outages are assumed to occur during scheduled major outages. However, normal major outages are not long enough to perform all of the work related to installation of SCR on the units, so the outage cost included in the total capital cost estimate is the incremental cost ofextending those outages. If you have any questions regarding this information or the previous BART submittals, please contact Barbara Sprungl at (602) 236-5374 or me at (602) 236-2968. Sincerely,

# ~~j[~f' Kevin Wanttaji, Manager Environmental Services
cc w/attachments: Colleen McKaughan, EPA Region 9 Steven Frey, EPA Region 9 Anita Lee, EPA Region 9 Scott Bohning, EPA Region 9 Stephen Etsitty, Navajo Nation EPA Robert Talbot, NOS LOC 6-2-7.1 IXI36030708

### o.liveri"9 more than 

### power ..



# SALT RIVER PROJECT NAVAJO GENERATING STATION

SCR 

# & SNCR COST STUDY FINAL REPORT

Prepared By:

Project No. 11234-028 July 25, 2008 Rev. 3

### ail~'~'" 

# ...... Der...,.rhlg mare than poww.' Project No. 11234-028 July 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study

Navajo Generating Station SCR & SNCR Cost Study Issue Summary

Revision Date Purpose Prepared By Reviewed By Approved By Pages Number Affected A 09/14/07 Client Comment R. Gaikwad A. Baker E. Shameem All B 09/21/07 Client Comment R. Gaikwad A. Baker E. Shameem 1,8-12 0 10/04/07 Final Issue R. Gaikwad A. Baker E. Shameem All 1 10/19/07 Updated O&M Costs R. Gaikwad A. Baker E. Shameem 17
2 11/16/07 Updated O&M Costs R. Gaikwad A. Baker E. Shameem 17
3 7/25/2008 Final 

# rfib d

-­ f­ 

## /.vl

..**~/f¥'T** 

### .,.....-­ ......... All . Gaikwad A. Baker E. Shameem



### 15-1

5argo " Lundy'"1**.,;~,~**

# .. .,

# ..... Delivering more tl_ power,' Navajo Generating Station SCR & SNCR Cost Study 

### TABLE OF CONTENTS

SECTION TITLE ISSUE SUMMARY TABLE OF CONTENTS 

### 1 PURPOSE 

### 2 INTRODUCTION 

### 3 INPUT DATA 

### 4 METHODOLOGY 

### 5 DESCRIPTION OF CONTROL TECHNOLOGIES 

### 6 CONSTRUCTABILITY 

### 7 ESTIMATED CAPITAL COSTS 

### 8 ESTIMATED O&M COSTS

ATTACHMENTS LAYOUTS FOR STUDY OPTIONS Project No. 11234-028 July 25, 2008 Rev. 3

PAGE NO. IS-1



### 1 2 2 

### 3 4 

### 4 6 

### 8 

### 10

1

# ....**~,~** 

# .... 

# ....... Project No. 11234-028 Delivering

# mor. than power.' July 25,2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study


### 1. Purpose The main objective of this study is to support the Best Available Retrofit Technology (BART) analysis for the Navajo Generation Station (NGS) by performing a hlgh level review of feasibility and development of a capital cost estimate for installing Selective Catalytic Reduction (SCR) or Selective Non-Catalytic Reduction (SNCR) on all three units.
2. Introduction The NGS is located near Page, AZ. 

### and consists of three nominally 750 MW units that were built in the late 1970s. The boilers burn a low sulfur fuel from a nearby mine. The units were originally equipped with hot-side electrostatic precipitators (HESP) and were retrofitted with wet flue gas desulfurization (WFGD) systems in the 1990s. The HESPs are stacked units. New wet chimneys were installed as part of the WFGD retrofit project and the existing chimneys were partially demolished to a height of 195'. Currently, the NOx levels from the NGS units are around 0.30-0.40 Ib/mmBtu. The station intends to retrofit the boilers with Low NOx Burners and separated overfire air modifications (LNB/SOFA) which are expected to reduce NOx levels to approximately 0.24 Ib/mmBtu. The intent of this study is to develop high level cost estimates for the addition of SNCR to achieve a NOx level of 0.20 Ib/mmBtu or SCR technology to achieve NOx level of 0.08 Ib/mmBtu. Salt River Project (SRP), part owner and operator of NGS, contracted Sargent & Lundy LLC (S&L) to investigate the retrofit difficulty associated with implementing these control technologies and develop the corresponding high level costs. It should be noted that the objective of this study is not to develop conceptual designs for retrofitting these new control technologies. but to come up with high level arrangements. To achieve the above noted objective, S&L engineers visited the NGS on August 28, 2007 and met with the plant staff to discuss the study as well as to obtain relevant data. The S&L team also performed walkdowns of the units to ascertain the retrofit difficulty.
2**.,;~,~** 

# ....**~~** Project No. 11234-028 Der.".,rll1S more !han I'CW""" July 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study



### 3. Input Data The following data was provided by SRP and was used as the basis for this cost study:

• The typical fuel analysis is provided below:
Carbon 69.90 Hydrogen 4.90 Nitrogen 1.10 Sulfur 0.57 Oxygen 12.72 Ash 10.80 Moisture 12.90 Heating Value, Btu/lb 10,601 Hardgove Index 46.0 Ash Fusion temp. F (reducing) 2,260 F

• The units fluctuate down 150-200 MW during the night and can go down to 400 MW.

• Major unit outages are scheduled for 55 days and allow 50 days for implementation of the new control technologies.

• Heat Input to Boiler - 7,500 mmBtu/hr

• HESP inlet and outlet temperatures are 700 F and 660 F, respectively

• The air preheater (APH) outlet temperature is 275 F.



### 3

## "'~"~.iiIIa**~....,** Project No. 11234-028 Dellveril19 more than power," July 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study

• The temperature at the inlet to the wet scrubber is 275 F. 

### 4, Methodology As discussed above, the following control scenarios were investigated: Option 1A: LNB/SOFA + HESP + SCR Option 1B: LNB/SOFA + HESP + SNCR
For the above scenarios, it should be noted that the HESP is already in service and that the costs associated with the LNB/SOFA modifications have been estimated by SRP at $10 million per unit. As such, this study will develop costs for the SCR and SNCR only.
Based on the information gathered during the site visit and walkdown, S&L prepared rough layouts for the options noted above. These layouts were used for comparison purposes with some of our recent retrofit projects to estimate high level costs. Retrofit difficulty was factored into the cost estimates. It should be noted that the SNCR option was added after the site visit. 

### 5, Description of Control Technologies The specific control technologies included in the scope of this study are discussed below: Selective Catalytic Reduction (SCR):
SCR is a technology that has received wide use in the last 8 years. In coal based SCR systems, the flue gas is treated with a reducing agent, generally ammonia vapor, via an injection grid, and is passed over multiple layers of catalyst allowing a reaction with nitrogen oxides to take place, forming nitrogen and water. This reaction is temperature sensitive and generally occurs in the 560 F - 800 F range. For this reason, the catalyst layers must be


### 4**...-~,,~**

# ... 

# ....... Project No. 11234-028 DeliWlI'ing more than power.' July 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study 

### located downstream of the economizer outlet and upstream of the air heater. The ammonia that slips through the SCR is limited to approximately 2 ppmvd (@3% O2) , 

### The catalysts can have different compositions: based on titanium oxide, zeolite, iron oxide or activated carbon. Most catalysts in use in coal-fired plants consist of vanadium pentoxide (active catalyst) and titanium dioxide (used to disperse and support the vanadium) mixture. However, the final catalyst composition can consist of many active metals and support materials to meet specific requirements in each SCR installation. The catalyst has an average life of 2 to 3 years depending on the fuel and flue gas constituents. SCRs are generally designed with space for a spare layer of catalyst so that a portion of the catalyst can be replaced with new catalyst at regular intervals. NOx 

### reductions of approximately 80 ­ 90% may be achieved with SCR systems. Selective Catalytic Reduction (SCR) at NGS could be applied to treat 100% of the total flue gas. All three units at NGS have a hot side ESP. The outlet conditions, with very low particulate loading, make it possible to retrofit SCRs at the outlet of the HESP. During the waIkdown, based on the preliminary sizing of SCR, it was determined that the SCRs can be retrofitted on Units 1 and 3 with an average degree of retrofit difficulty. However, retrofitting on Unit 2 would be very difficult. The SCR design is based on the inlet NOx of 0.24 Ib/mmBtu to achieve outlet emission of approximately 0.08 Ib/mmBtu.
Selective Non-Catalytic Reduction (SNCR1: 

### The SNCR process requires that injection of either ammonia or urea into the flue gas occurs within a temperature window of 1600-2100°F to reduce NOx to nitrogen and water. Multiple injection levels are used to maintain NO

### x reduction efficiencies as the boiler load changes. At temperatures above 2000°F, ammonia and urea react with oxygen to form additional NOx. 

### At low flue gas temperatures below 1700°F, excess ammonia can lead to the formation of ammonium salts. Due to minimal use of reagent and low removal efficiency, this technology typically is applied to smaller units of an existing fleet such that these smaller 

### 5**-':~'~.ia**

## ~~ Project No. 11234-028 Delivering**~.** thon powe.... July 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study 

### units can be bubbled with the larger units to satisfy system-wide NO

### x emission allowance limits. Typically, 10-40% NO

### x removal efficiencies can be achieved with SNCR technology depending on boiler conditions. However, for larger units, the technology can be applied as a polishing technology achieving 15-20% NOx removal efficiency. For purposes of this study, it has been assumed that 15% efficiency is feasible if installed at Navajo units with a 5-ppm ammonia slip. If SNCR is selected at this efficiency, boiler mapping should be performed to determine the exact removal efficiency with this technology.
6. Constructability Unit 1 and Unit 3 SCR's: In general, the construction of the SCR's and their associated support structures would berelatively straightforward; however, the modifications at the precipitator outlet required to tiein the SCR's would be difficult. With this ductwork located between the boiler and precipitator, access to the area near the air heaters is constrained. The extent of the modification work required and the limited access to the immediate work area will most likely require an extended outage to complete. The proposed layout of the Units 1 and 3 SCRs is shown in Attachment 1. In this arrangement, the SCR's are located outboard of the units, with tie-ins to the precipitator outlet ductwork. S&L anticipates that new ID booster fans would be added downstream of the SCRs. It is expected that the modification/tie-in work would require on the order of 9 t012 weeks to complete. For purposes of the capital cost estimate, it is assumed that the retrofit would occur during a major outage, and extend such outage by 4 weeks.



### 6

### a;:~''-t.'" 

# ....... Project No. 11234-028 DeliverIng more thollpoww.' July 25,2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study 

### Unit 2 SCR: S&L looked at various alternatives on Unit 2, but with Unit 2 located between Units 1 and 3 and with other equipment including the coal conveyor and it's supports located immediately adjacent to Unit 2, the construction of an SCR in an economical configuration similar to that for Units 1 and 3 is not possible. With limited room for the SCR and with limited access for construction cranes and equipment, the installation of an SCR on Unit 2 would be extremely difficult. The limited access for construction equipment would limit the size of pre-fabricated assemblies that can be set directly in place and would drive up the cost of construction considerably. In addition, in order to make room for the SCR's and fans on Unit 2, it is expected that the remainder of the old Unit 2 chimney would have to be demolished. Note that a high dust SCR might be more feasible on Unit 2, however the construction difficulties still persist and no major cost saving can be justified with the possible high dust configuration. The proposed layout of the Unit 2 SCR is shown in Attachment 1. In this arrangement, the SCR's would be located adjacent to the existing old chimney (which would be demolished) and above the existing 

### 10 fan outlet ductwork. Tie-ins would be made to the precipitator outlet ductwork on each side of the unit. New booster fans would be installed in the area vacated by the demolition of the old chimney. Note that rework of the 

### 10fan outlet ductwork may be required in order to provide clearance for maintenance work on the new booster fans. With the limited access for construction equipment, and the close proximity of the coal conveyor, it is expected that the modification/tie-in work would require on the order of 12-15 weeks to complete, primarily due to extreme care that must be taken to avoid any damage to the coal conveyor. For purposes of the capital cost estimate, it is assumed that the retrofit would occur during a major outage, and extend such outage by 6 weeks.



### 7

### /8i;~'~" 

# .,...., Project No. 11234-028 DerMlring men than power." July 25. 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study 

### SNCR Installation: The SNCR investigation was added to the scope of this study after the S&L site visit. Even though our walkdown did not investigate this option, the location/s for ammonia or urea injection lances are likely available in the 1600 0F 

### to 21000F 

### temperature range. The reagent tanks could be located on plant premises. The boiler penetration for lances can be completed within a 4 week outage, and therefore could be completed without extending an outage if the work were completed during a normal major outage.
7. Estimated Capital Costs The basis of the capital cost estimates provided herein is as follows: The costs were developed using the internal S&L database of costs which includes recently completed and in-progress projects. Adjustments were made to reflect the major differences in quantities such as ductwork and structural steel. More importantly, these costs were adjusted to account for constructability issues which, in some cases, are significant for NGS. It should, however, be noted that these costs were estimated at a high level ($/kW). The estimated costs included are "total plant costs" and include equipment and material, direct field labor (including contractor G&A and profit) and indirect costs (engineering, construction management and commissioning) The cost of replacement power ($45/MWh) was provided by SRP. The estimated capital costs associated with the various options are as discussed below:



### 8**a;;~'~** 

## .. 

# ...." Project No. 11234-028 Dtfwerlng more tha" pow..... July 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study 

### Units 1 and 3 SCR: Based on an overall degree of difficulty, the capital cost for a low dust SCR system on either Unit 1 or 3 is estimated to be approximately $165 million. Lost generation costs based on extending major outages for each unit an additional 4 weeks is approximately $23 million per unit based on a replacement power cost of $45/MWh.
Unit 2 SCR: With the degree of difficulty of the installation as well as the cost penalties to the Unit 1 work, the cost for a Unit 2 SCR is estimated to be in the order of $220 million. Lost generation costs based on extending a major outage an additional 6 weeks is approximately $34 million. Due to the degree of difficulty of the Unit 2 work, it is recommended that further feasibility studies are conducted prior to committing to installing an SCR on Unit 2.
SNCR Installation: The capital cost for SNCR installation on each of the units is expected to be approximately 10 million dollars. Because it is assumed the retrofits could be completed within a current major outage, there are assumed to be no lost generation costs. Capital Cost Summary: Based on the above, the estimated capital costs for the options evaluated are summarized in Table 7-1 on the following page. As noted earlier, a more detailed feasibility study and detailed cost estimate should be prepared to develop budgetary costs for the control option chosen.



### 9Project No. 11234-028 o.n".rlng man than power.. JUly 25, 2008 Navajo Generating Station Rev. 3 SCR & SNCR Cost Study 

### Table 7-1 Capital Cost Summary

Control Technology Costs Option Unit (Millions) Outage Costs Total Costs lNBlSOFA SCR (Millions) (Millions) $10 $165 $23 $198 1A 2 $10 $220 $34 $264 3 $10 $165 $23 $198 $10 $0 $20 18 2 $10 $0 $20 3 $10 $0 $20



### 8. Estimated O&M Costs The estimated O&M costs associated with the SCRs and SNCRs are as follows: LNB·SOFAISCR SNCR M$/vr M$/vr Fixed O&M 0.42 0.10 Variable O&M, (@90Of. ACF) Ammonia ($400/ton). Urea 0.936 1.736 ($400110n) Catalyst Replacement 0.342 0 Aux. Power ($60/MWH) 2.46 0.19 Lost Ash Sales .. 0 3.4 Total Variable O&M 4.158 5.326

.. For purposes of this analysis, it Is assumed that ammonia slip from the SNCR renders fly ash unsalable (figure provided by SRP). LNB/SOFA may also impact the salability ofthe fly ash, but for purposes of this analysis, it is assumed that the fly ash can continue to be marketed.



### 10'''''' It - i"'".:.-... J lIfelfI'a. "- i.MooI _- - ---.r. _. -..,/r,lIolOOo,l .. eil-.- -....=t_.J**i"~** -...-;, --..Ii-'..,
_
,

______**111~'·!'** _

I 1'0 

## .r f,} @

-­**,~­ ~-­**  0-­ G>--­**~­** r ; 0­e11>-­

-­ ®--­
1­

----­ [i)
@--­**~­** ri)-­ - 11>-­

-­ (.:.)-­

-­ ®--- ---­**--::-~** i**(~--_.­** 1­**-~**

@--

Vl 7' o <0 .b o -J I+.**~~** .= .=**:~** .= .= .=**:~** 8-­**:~** .= 

### .= .= <'}­ ­ l">­ I!>­ -­ 

### ,­ ., (';>-­

--­**r;>--~­** $­

­ r;>--­ @-­ @-­

- ;. .J r;>--­

@-­ <'}­ ­ s­ $-­
­ @---­

@---­ 

# --­

1 @--­ ®-----, I!>­ - 

# l""'­
®---­ -­ l­ 

## -I! jd_j l**1~-+-----'**

(/l 

### '" c co .e, o ..., I N

### .., I t- o 

### .,. 

## .

# ~I:-

- ---@

- -;§

. (!J**~®** ,**-~--~**

... - ®

_._---@