From: Fairchild, Susan

To: Higgins, Cortney

Subject: RE: Revised Regulation and Preamble for Mineral Wool ad Wool Fiberglass

Attachments: Wool Fiberglass RTR Cost Impacts 3-14-13.docx

Wool Fiberglass Area Souce Cost Impacts_3 14 13.docx



### Cortney, I have revised the Wool fiberglass cost memos and am attaching them here.

Also, I left you a message regarding preamble discussion on Mineral wool. I plan to be in the office

until 4:15 if you are available to discuss later today.

Thanks,

Susan Fairchild

Senior Environmental Scientist

(919) 541-5167

USPS Address:

OAQPS/SPPD/MMG

Mail Code D 243-04

Research Triangle Park, NC 27711

From: Higgins, Cortney [mailto:Cortney_Higgins@omb.eop.gov]

Sent: Thursday, March 14, 2013 10:59 AM

To: Barnett, Keith

Cc: Fairchild, Susan; VanLare, Paula; Okoye, Winifred; Fruh, Steve

Subject: RE: Revised Regulation and Preamble for Mineral Wool ad Wool Fiberglass



### Hi all,

After looking through the edits, I don’t think we need the call today.

Thanks,

Cortney

From: Higgins, Cortney

Sent: Wednesday, March 13, 2013 7:05 PM

To: Barnett, Keith

Cc: Fairchild, Susan; VanLare, Paula; Okoye, Winifred; Fruh, Steve

Subject: RE: Revised Regulation and Preamble for Mineral Wool ad Wool Fiberglass



### Hi Keith,

Thanks! Let’s go ahead and plan on the 11 am meeting tomorrow – it may end up being shorter

than 30 minutes.

Do you have an estimate on when the revised cost documents (responding to the interagency

comments) will be ready?

### Regards,

Cortney

From: Barnett, Keith [ mailto:Barnett.Keith@epa.gov ]

Sent: Wednesday, March 13, 2013 6:28 PM

To: Higgins, Cortney

Cc: Eck, Janet; Fairchild, Susan; VanLare, Paula; Okoye, Winifred; Blake, Wendy; Fruh, Steve

Subject: Revised Regulation and Preamble for Mineral Wool ad Wool Fiberglass



### Dear Courtney:

Revised package attached. Note that we made some additional edits to the GACT rationale in

response to OGC comments, and also modified the write-up on startup, shutdown, and malfunction

for the area source rule. The previous SSM write-up was the one we use in major source RTRs – and

is not appropriate for an area source rule.

Per your request I have removed all comment bubbles and attached one clean copy and one redline

comparing this version to the version originally sent to OMB.

Keith Barnett

Group Leader

Minerals and Manufacturing Group

919-541-5605

## 1 MEMORANDUM

Date: March 1 3 , 2013

Subject: Cost s and Emission Reductions for the Proposed Wool Fiberglass Manufacturing

NESHAP

- Area Source s

RTI Project No. 021 3199

. 00 1

. 0 07

From: Dave Reeves, RTI International

To: Susan Fairchild

OAQPS/SPPD/NRG (D243

- 02)

U.S. Environmental Protection Agency

Research Triangle Park, NC 27711

The purpose of this memorandum is to present the estimated costs for the wool fiberglass

manufacturing industry to comply with the proposed area source rule requirements

. Major sources

are regulated under Part 63 Subpart NNN; area sources will be proposed to be regulated under Part

63, Subpart NN.

I. BACKGROUND

Based on the information provided by the wool fiberglass manufacturing industry and their

primary trade association , North American Insulation Manufacturers Association (NAIMA)

, there

are currently 30 facilities in the U.S. producing wool fiberglass

. A letter from NAIMA dated June

8, 2011, stated “non

- formaldehyde binder products represent the vast majority of the industry” and

“all major sources have already converted or have announced plans to convert to non

- phenol

formaldehyde binders.” B ased on a review of the current permit status of all sou rces and recent

information provided by industry

, there are 10 facilities that are major sources (subject to the

existing MACT rule, subpart NNN) and 2 0 area source facilities ( with a total of 5 4 glass

- melting

furnaces )

. However, five of the area source fa cilities with a total of eight furnaces meet the

proposed applicability requirements in t he proposed area source NESHAP (subpart NN) ; two of

those facilities with a total of three furnaces will need to install control equipment to comply with

the proposed standards . Table 1 shows metals emissions by furnace type and source.

Industry comments on the proposed major source rule amendments (76 FR 72770) stated that

s ome of the major source fa cilities have already switched some or most of their lines to non

- HAP

binders and are working towards being redesignated as area sources and no longer subject to

subpart NNN. While industry sources also predicted before proposal of the RTR amendments to

NNN that no major sources would exist by the end of 2012, we now find this to be an

overstatement. Table 2 provides further information on wool fiberglass furnaces by furnace type

and whether furnaces would currently be subject to the proposed area source r ule under subpart

NN. T he following cost impacts are based on the estimated five facilities and eight gas

- fired

furnaces that w ould be subject to the proposed area source rule requirements.

## 2 II. GAS

- FIRED GLASS

- MELTING FURNACES

Based on emissions test data received, w e estimate that there are currently eight gas

- fired furnaces

located at five facilit ies that do not meet the proposed chromium compounds emission limit. We

have estimated the add

- on control cost impact for th ose f acilit ies (three furnaces) based on the

installation of a sodium hydroxide (NaOH) scrubber to remove chromium compounds from the

furnace exhaust stream(s). The initial capital equipment cost was estimated to be $250,000 for

each unit (scrubber) with a calculated annualized capital c ost of $27,400 based on a 15

- year

equipment life and 7% interest rate. The annual operati on and maintenance (O&M) cost s were

estimated to be $ 72,600 per unit. The combined annualized cost is $100,000 per scrubber. Some of

t he high est chromium compound emit ting furnace s are located at major source facilit ies and those

cost impacts will be attributed to subpart NNN

.

The total cost for the five facilities to comply with the proposed area source rule is estimated to be

$380,000 per year. Table 2 summarizes the above informat ion and associated cost impacts.

III. COMPLIANCE TESTING COSTS

Mr. Steffan Johnson of EPA’s Measurement Policy Group provided the following cost estimates

for compliance testing based on the test methods included in the final RTR amendments:

Emission

Source HAP Test

Method Test

Cost s

(201 1 $) Test

Freq

uency Annualized

Test Costs

(201 1 $) Comment

Glass

Melting

Furnace PM (surrogate

for HAP metals) 5

and

29

(combined) $10,000 Every

year* $10,000 *Reduced test

frequency not

included in this

cost analysis. Chromium

Compounds

* The proposed rule allow s owners/operators to reduce testing frequency for PM and chromium

compounds from every year to once every three years if the initial and second compliance tests are

each less than 75% of the proposed PM and chromium compounds e mission limit s

.

IV. EMISSION REDUCTIONS

Based on the recent test data provided by all of the facilities, the eight gas

- fired furnaces located at

area sources emit approximately 65 pounds of chromium compounds annually. We identified three

gas

- fired furnaces at two area sources with emission rates above the proposed emission limit and

their as sociated annual emissions of 5, 25, and 35 pounds of chromium compounds, respectively.

## 3 Wool fiberglass companies review a number of options at their disposal when determining

how to best meet environmental goals, including whether it is more cost effective to rebuild a

furnace near the end of it’s useful life, extend the life of the furnace using hot

- repairs, or to add

- on

air pollution controls to meet emission limits. Companies have developed many variations to the

basic gas

- fired furnace design that dramatically alter emissions from these processes. See the

GACT memo in the docket for mor e information on this topic. However, if facilities choose to

add

- on air pollution control devices to reduce emissions, they would incur those costs of control

presented below. With the assumption that additional controls on the three furnaces will reduce

chromium compound emissions to a level that would meet the proposed emission limit,

approximately 53 pounds of chromium compounds would be reduced annually at area sources

– which represents an 80 percent reduction compared to current baseline emissions. T he cost

effectiveness (in dollars per pound of chromium reduced) for the two impacted facilities is

$10,000 and $3800, for an average cost effectiveness of $7200 per pound of chromium reduced.

Table 1. Total metals and chromium emissions by furnace type a nd source, lb/yr.

Number of

Furnaces Total Metals Emissions

(lb/yr) Chromium Emissions

(lb/yr)

Major Area Major Area Major Area

Electric

Furnaces 21 46 10 10

Gas Fired 8 8 530 70

Total 29 54 760 420 540 80

## 4 Table 2 . Summary of Costs for Wool Fiberglass M anufacturing Facilities to Comply with Proposed Area Source Rule

Table 1 notes:

- Major sources will not be subject to the area source rule requir e ments and any associated control/compliance costs are not included.

. - JM Waterville, OH facility also has 40 pot & marble furnaces which are not included in this analysis.

- A nnualized capital cost is based on interest rate of 7% and 15 year equipment life

.

- Emissions reductions for Knauf Lanett are estimated to be 1 lb Cr/yr for furnace 1 and 21 lbs Cr/yr for furnace 2. 

### Glass

- Melting Furnaces Total Facility Cost

Annual

O&M

Costs Cr

Testing

Cost Company Facility

Location Source

Type* Steel

Shell Electric

Cold

Top Air

Gas Oxy

Fuel Tota

l # #

subject

to area

rule Annual

ized

Capital

Cost* Total

Annual

Facility

Cost

1 CertainTeed Athens, GA Area 1 1 2 1 0 0 1 0 ,000 10,000

2 CertainTeed Chowchilla, CA Area 1 1 1 0 0 1 0 ,000 10,000

3 Guardian Kingman, AZ SynMnr 1 1 0 0 0 0 0

4 Johns Manville McPherson, KS Area 5 5 0 0 0 0 0

5 Johns Manville Penbryn, NJ Area 3 3 0 0 0 0 0

6 Johns Manville Richmond, IN Area 1 1 0 0 0 0 0

7 Johns Manville Waterville, OH Area 6 6 0 0 0 0 0

8 Johns Manville Willows, CA Area 6 6 0 0 0 0 0

9 Johns Manville Winder, GA Area 5 5 0 0 0 0 0

10 Knauf Lanett, AL Area 2 2 2 54,800 145,200 2 0,000 2 2 0,000

11 Knauf Shasta Lake, CA A rea 1 1 0 0 0 0 0

12 Owens

- Corning Delmar, NY Area 2 2 2 27,400 72,600 20 ,000 120

, 0 00

13 Owens

- Corning Eloy, AZ Area 2 2 0 0 0 0 0

14 Owens

- Corning Fairburn, GA Area 3 3 0 0 0 0 0

15 Owens

- Corning Kansas City, KS Area 1 2 3 2 0 0 2 0,000 2 0 ,000

16 Owens

- Corning Mount Vernon, OH Area 3 3 0 0 0 0 0

17 Owens

- Corning Salt Lake City, UT SynMnr 2 2 0 0 0 0 0

18 Owens

- Corning Santa Clara, CA A rea 2 2 0 0 0 0 0

19 Owens

- Corning Nephi, UT SynMnr 2 2 0 0 0 0 0

20 Owens

- Corning Lakeland, FL Area 2 2 0 0 0 0 0

21 CertainTeed Kansas City, KS Major 2 2 0 0 0 0 0

22 Guardian Albion, MI Major 4 4 0 0 0 0 0

23 Guardian Inwood, WV Major 2 2 0 0 0 0 0

24 Guardian Mineral Wells, MS Major 2 2 0 0 0 0 0

25 Guardian Winnsboro, SC Major 1 1 0 0 0 0 0

26 Johns Manville Cleburne, TX Major 2 1 3 0 0 0 0 0

27 Johns Manville Defiance, OH Major 1 3 2 6 0 0 0 0 0

28 Knauf Shelbyville, IN Major 2 2 0 0 0 0 0

2 9 Owens

- Corning Newark, OH Major 2 2 4 0 0 0 0 0

30 Owens

- Corning Waxahachie, TX Major 2 1 3 0 0 0 0 0

Totals 42 25 4 12 83 8 $82,200 $ 217,800 $ 80 ,000 $ 380

, 0 00

## 1 MEMORANDUM

Date: March 11

, 201 3

Subject: Cost s and Emission Reductions for the Proposed Wool Fiberglass Manufacturing

NESHAP

- Residual Risk and Technology Review (RTR) Amendments

Wool Fiberglass Manufacturing RTR

RTI Project No. 021 3199

. 00 1

. 0 07

From: Dave Reeves, RTI International

To: Susan Fairchild

OAQPS/SPPD/NRG (D243

- 02)

U.S. Environmental Protection Agency

Research Triangle Park, NC 27711

The purpose of this memorandum is to present the estimated costs for the wool fiberglass

manufacturing industry to comply with the re

- proposed RTR amendments

.

I. BACKGROUND

Based on the information provided by the wool fiberglass manufacturing industry and their

primary trade association , North American Insulation Manufacturers Association (NAIMA)

, there

are currently 30 facilities in the U.S. producing wool fiberglass

. A letter from NAIMA dated June

8, 2011, stated “non

- formaldehyde binder prod ucts represent the vast majority of the industry” and

“all major sources have already converted or have announced plans to convert to non

- phenol

formaldehyde binders.” However, based on a review of the current permit status of all sources,

there are 1 0 ma jor source facilities with 8 gas

- fired glass

- melting furnaces and 3 1 manufactu r ing

lines that will have to comply with the RTR amendments to the NESHAP (subpart NNN)

requirements

. Industry comments on the proposed rule stated that several facilities have already

switched all or most of their lines to non

- HAP binders and submitted paperwork to be

redesignated as area sources and no longer subject to subpart NNN. Therefore, the following cost

impacts are based on an estimated 10 facilities that were identified as major sources in the most

recent industry inform ation provided in December 2012, as shown in Table 1.

II. GLASS

- MELTING FURNACES

Based on emissions test data received, w e estimate that there are currently t hree gas

- fired furnaces

located at two facilit ies that cannot meet the proposed chromium compounds emission limit. We

have estimated the cost impact for th ose facilit ies based on the installation of a sodium hydroxide

(NaOH) scrubber to remove chromium compounds from the furnace exhaust st ream(s). The initial

capital equipment cost was estimated to be $250,000 for each unit (scrubber) with a calculated

annualized capital cost of $27,400 based on a 15

- year equipment life and 7% interest rate. The

annual operation and maintenance (O&M) costs were estimated to be $72,600 per unit. The

## 2 combined annualized cost is $100,000 per scrubber. T he high est chromium compound emitting

furnace was idled in December 2011 and the company indicated that it may be re

- built prior to

being brought back on

- line.

III. ROTARY SPIN AND FLAME ATTENUATION MANUFACTURING LINES

As mentioned previously, several facilities have already switched all or most of their rotary spin

(RS) manufacturing lines to non

- PF binders . Based on the most recent information provided by

indust ry, w e estimate that the re will be 10 facilities subject to the final rule requirements with 1 8

RS manufacturing lines making bonded product. Two of those facilities also have 1 3 bonded

flame attenuation (FA) lines producing heavy density products and /or pipe insulation

. Based on

facility information collected in the survey responses, most facilities currently have thermal

oxidizers and we assumed that the estimated 6 facilities currently not meeting the proposed

emission limits have thermal oxidizers (or scrubbers) on their bonded product lines. Therefore,

there are no additional capital costs to comply with the new RS emission limits and we estimated

operation and maintenance (O & M) costs for a thermal oxidizer at each facility to be $125,000

annually. All 10 major source facilities with bonded lines will incur additional testing cost s to

demonstrate compliance with the new phenol and methanol emission limits for forming and curing

operations

.

The total industry cost to comply with the proposed amendm ents is estimated to be $1.21 million

per year. Table 2 summarizes the above informat ion and associated cost impacts.

IV. COMPLIANCE TESTING COSTS

Mr. Steffan Johnson of EPA’s Measurement Policy Group provided the following cost estimates

for compliance te sting based on the test methods included in the final RTR amendments:

Emission

Source HAP Test

Method Test Cost s

(in 201 1 $) Test

Freq

uency Annualized

Test Costs

(in 201 1 $) Comment

G as

- Fired

Furnace Chromium

Compounds 29 $ 10 ,000 Every

year* $ 10 ,000 *Reduced test

frequency not

included in this

cost analysis.

Collection/

Curing

(combined) Phenol and

Methanol

(already testing

formaldehyde) 318 $1 5 ,000

(combined

p henol &

m ethanol) 

## Every

5 years $ 3,0 00 $12,000 for

each additional

test ($2,400

annualized)

* The final rule will allow owners/operators to reduce testing frequency for chromium compounds

from every year to once every three years if the initial and second compliance tests are each less

than 75% of the chromium compounds emis sion limit in the proposed amendments

.

## 3 V. EMISSION REDUCTIONS

A. Gas

- Fired Glass

- Melting Furnaces

Based on the recent test data provided by the facilities, the eight gas

- fired furnaces emit

approximately 500 pounds of chromium compounds annually. We identified three gas

- fired

furnaces at two facilities with emission rates above the proposed emission limit and their

associated annual emissions of 13 , 15, and 442 pounds of chromium compounds , respectively

.

Wo ol fiberglass companies review a number of options at their disposal when determining

how to best meet environmental goals, including whether it is more cost effective to rebuild a

furnace near the end of it’s useful life, extend the life of the furnace us ing hot

- repairs, or to add

- on

air pollution controls to meet emission limits. Companies have developed many variations to the

basic gas

- fired furnace design that dramatically alter emissions from these processes. See the

Technology Review memo for this p roposed rulemaking in the docket for more information on

this topic. However, if facilities choose to add

- on air pollution control devices to reduce

emissions, they would incur those costs of control presented below. With the assumption that

additional con trols on the three furnaces will reduce chromium compound emissions to a level that

would meet the proposed emission limit, approximately 455 pounds of chromium compounds

would be reduced annually at major sources

– which represents a 90 percent reduction compared

to current baseline emissions.

Table 1. Total metals and chromium emissions by furnace type and source, lb/yr.

Number of

Furnaces Total Metals Emissions

(lb/yr) Chromium Emissions

(lb/yr)

Major Area Major Area Major Area

Electric

Furnaces 21 46 10 10

Gas Fired 8 8 530 70

Total 29 54 760 420 540 80

The annualized control costs for the gas

- fired furnaces ($380,000) divided by the emission

reduction (455 pounds of chromium compounds) results in a cost effectiveness of $835 per pound

of chromium compounds reduced. The cost effectiveness for one facility is $10,000 per pound of

chromium reduced and the cost effectiveness for the second facility is $497 per pound.

B. Combined Collection/Curing Operations

Based on the recent test data provided by the facilities, the 31 manufacturing lines located at the

10 major source facilities emit approximately 600 tons of organic HAP (i.e., formaldehyde,

phenol, and methanol) annually. We identified eight manufacturing lines with emission rates

above the pr oposed emission limits. With the assumption that additional controls on the eight

## 4 rotary spin (RS) manufacturing lines will reduce organic HAP emissions to a level that would

meet the proposed emission limits, approximately 123 tons of organic HAP would be reduced

annually at major sources

– which represents a 20 percent reduction compared to current baseline

emissions.

The annualized control costs for the RS manufacturing lines ($830,400) divided by the total

emission reduction (123 tons of organic HAP) r esults in a cost effectiveness of $6,750 per ton of

organic HAP reduced. On an individual facility basis, the cost effectiveness for the RS and FA

manufacturing lines ranged from $1,153 to $14,755 per pound of organic HAP reduced.

## 5 Table 2 . Summary of Costs for Wool Fiberglass Mfg Facilities to Comply with Proposed RTR Amendments

Source

Type Gas

- Fired Furnaces

Rotary Spin (RS) and Flame Attenuation (FA) Lines Total

Annualized

Facility

Cost

($)

Annual

ized

Capital

Cost* Annual O&M

Cost # Gas

Fired

Furn

aces Cr

Testing

Cost # RS

Mfg

Bonded

Lines Addt’l RS

Control (O

& M)

Costs*** # Flame

Atten. (FA)

Mfg Bonded

Lines RS and FA

Mfg Line

Testing

Cost s Company Facility

Location

1 CertainTeed Kansas City, KS Major 54,800 145,200 2 20,000 1 0 0 3,000 223,000

2 Guardian Albion, MI Major 0 0 0 0 2 0 0 5,400 5,400

3 Guardian Inwood, WV Major 0 0 0 0 2 125,000 0 5,400 130,400

4 Guardian Mineral Wells, MS Major 0 0 0 0 1 0 0 3,000 3,000

5 Guardian Winnsboro, SC Major 0 0 0 0 1 125,000 0 3,000 128,000

6 Johns Manville Cleburne, TX Major 0 0 1 10,000 1 125,000 2 7,800 142,800

7 Johns Manville Defiance, OH Major 0 0 2 20,000 4 125,000 11 36,600 181,600

8 Knauf Shelbyville, IN Major 0 0 0 0 4 0 0 10,200 10,200

9 Owens

- Corning Newark, OH Major 27,400 72,600** 2 20,000 1 125,000 0 3,000 248,000

10 Owens

- Corning Waxahachie, TX Major 0 1 10,000 1 125,000 0 3,000 138,000

11 Guardian Kingman, AZ SynMnr 0

12 CertainTeed Chowchilla, CA Area 0

13 CertainTeed Athens, GA Area 0

14 Johns Manville McPherson, KS Area 0

15 Johns Manville Penbryn, NJ Area 0

16 Johns Manville Richmond, IN Area 0

17 Johns Manville Waterville, OH Area 0

18 Johns Manville Willows, CA Area 0

19 Johns Manville Winder, GA Area 0

20 Knauf Lanett, AL Area 0

21 Knauf Shasta Lake, CA Area 0

22 Owens

- Corning Delmar, NY Area 0

23 Owens

- Corning Eloy, AZ Area 0

24 Owens

- Corning Fairburn, GA Area 0

25 Owens

- Corning Kansas City, KS Area 0

26 Owens

- Corning Mount Vernon, OH Area 0

27 Owens

- Corning Salt Lake City, UT SynMnr 0

28 Owens

- Corning Santa Clara, CA Area 0

29 Owens

- Corning Nephi, UT SynMnr 0

30 Owens

- Corning Lakeland, FL Area 0

$82,200 $217,800 8 $80,000 18 $750,000 13 $80,400 $1,210,400

Table 1 notes: * Annualized capital cost is based on interest rate of 7% and 15 year equipment life

. ** One (high

- emitting) f urnace already scheduled for replacement.

** * The re are no HF/HCl testing costs since the final rule requires work practice standards

.