MEMORANDUM

DATE: November 18, 2014

SUBJECT: Revised Cost Impacts of Pressure Relief Device Monitoring for the Off-site Waste and 

Recovery Operations Source Category

FROM: Lesley Stobert, EC/R Inc.

TO: Paula Hirtz, EPA/OAQPS/SPPD/RCG

The purpose of this memorandum is to present the revised estimated cost impacts of the 

proposed requirements for pressure relief device (PRD) monitoring for the Off-site Waste and Recovery

Operations (OSWRO) source category. The requirements for OSWRO facilities are being finalized in 40 

CFR part 63, subpart DD and apply to major sources of hazardous air pollutants (HAP) emissions at 

existing and new facilities under the national emissions standards for hazardous air pollutants 

(NESHAP). The addition of PRD monitoring to the NESHAP for this source category is being finalized

along with proposed changes evaluated under the EPA’s Risk and Technology Review (RTR) program,

which is addressing statutory requirements under section 112(d)(6) and 112(f)(2) of the Clean Air Act 

(CAA). The costs of the PRD monitoring program for OSWRO facilities has been updated since 

proposal to include the costs for four additional facilities that the EPA has learned are subject to the 

OSWRO NESHAP. Section 1 provides background information, followed by the estimated costs of the 

final PRD monitoring requirements for the source category in section 2.

1.0 BACKGROUND

On July 2, 2014 (79 FR 37850), the EPA proposed amendments to the OSWRO source category

following the results of a review required by section 112(d)(6) of the CAA, which directs the EPA to 

review previously issued NESHAP regulations and to revise them as necessary (taking into account 

developments in practices, processes and control technologies) no less frequently than every 8 years. 

Section 112(f)(2) of the CAA requires the EPA to assess, within 8 years of promulgation of the original 

NESHAP for major sources and area sources subject to MACT, the remaining risks due to emissions of 

HAP from these source categories and determine whether the emissions standards provide an ample 

margin of safety to protect public health. These reviews are collectively referred to as residual risk and 

technology reviews (RTRs).

In addition to the residual risk and technology reviews performed regarding the NESHAP, the 

EPA also reviews existing provisions of the NESHAP during the RTR process. In light of and consistent 

with a 2008 United States Court of Appeals for the District of Columbia Circuit decision (Sierra Club v. 

EPA, 551 F.3d 1019 (D.C. Cir. 2008)), in which portions of two provisions in the EPA’s CAA section 

112 regulations governing the emissions of HAP during periods of startup, shutdown and malfunction 

(SSM) were vacated, the EPA proposed to eliminate the SSM exemption for the OSWRO source 

category and require that the CAA section 112(d) emissions standards apply at all times, including 

periods of SSM. In addition, in order for the treatment of malfunction-caused releases to the atmosphere 

to conform with the reasoning of the Court’s ruling, the EPA proposed that PRDs in off-site material 
2

service must be monitored.

1

For the July 2014 proposal, the cost of these monitoring devices were 

estimated. Following the July 2014 proposal, the EPA received information from industry

representatives that four additional facilities that were not known to be part of the OSWRO source 

category are subject to the OSWRO NESHAP. We have revised our analysis of PRD monitoring costs 

for the OSWRO source category to include these four additional facilities for a total of 49 facilities that 

will be impacted by these requirements. 

2.0 COST IMPACTS 

Owners or operators could use a range of methods to identify pressure releases, record the time 

and duration of each pressure release and immediately notify operators that a pressure release is 

occurring, including parameter monitoring systems that facilities may already have in place. However, 

in order to estimate the costs associated with requiring monitoring of PRDs for OSWRO facilities, it was 

conservatively assumed that operators would install wireless electronic indicators on each PRD in offsite material service that vents to the atmosphere. To estimate the cost of electronic indicators, we used 

information from analyses performed by the South Coast Air Quality Management District (SCAQMD) 

of California, which were conducted in support of a rule that requires continuous monitoring of a 

percentage of PRDs at refineries by installing a monitoring device capable of recording the duration of 

each release and quantifying emissions. Wireless technology allows continuous monitoring of PRDs and 

makes it easier for operators to identify releases and leaks.2There are several types of monitoring 

devices available, including acoustic sensors and pressure/differential pressure sensors. These sensor 

units communicate with a base radio that interfaces with the existing control system. The costs for PRD 

wireless monitoring, based on information from the SCAQMD analyses, are summarized in Table 1. We 

note that our cost estimate, which assumed the installation of electronic indicators on each relief device 

that vents to the atmosphere, likely overstates actual costs to the industry, as an owner or operator may

use parameter monitoring systems already in place.

The monitoring device cost provided by the SCAQMD was based on vendor costs and ranged 

from $5,000 to $10,000, with an average of $7,500, and includes device parts, installation, and 

maintenance, as well as a data retrieval system. According to the SCAQMD analyses, annual operating 

costs are minimal because they typically only include periodic replacement of inexpensive batteries. It

was assumed that, for this analysis, these costs were presented in 2007 dollars and were therefore 

escalated to 2012 dollars. As a result, the total capital investment was determined to be $8,345 per PRD. 

According to the SCAQMD analyses, the cost of electronic monitoring systems is not linear, and 

facilities requiring a larger number of monitors are expected to benefit from economies of scale. 

Therefore, the sixth-tenths rule was applied to calculate initial costs.3 As shown in Table 1, the total 

capital investment for the model OSWRO facility, which has 13 PRDs, was determined to be $38,900. A 

capital recovery factor of 0.1424 was applied to the total capital investment to get an annualized cost for 

the model plant of $5,500/yr (no operating costs were estimated as they are assumed to be minimal).

 

1

The proposed provisions also clarify that releases from PRDs directly to the atmosphere would be prohibited by the 

OSWRO NESHAP.

2

Ellis, Kennard, SCAQMD. Final Staff Report for Proposed Amended Rule 1173 - Control of Volatile Organic Compound 

Leaks and Releases from Components at Petroleum Facilities and Chemical Plants. May 15, 2007. Docket No. EPA-HQOAR-2010-0869-0024.

3

Sixth-tenths rule is used to adjust for economies of scale. Cost to Facility = cost of one PRD * (number of PRDs at 

facility)^0.6.
3

Table 1. Total Capital Investment and Annualized Cost of PRD Monitoring

Cost Parameter Value

Number of PRDs at Model OSWRO Facilitya13

Unit Device Installation Costb $7,500 (2007 Dollars)

$8,345 (2012 Dollars)c

Facility Total Capital Investmentd$38,886

Total Capital Investment for the OSWRO 

Source Categorye $1,905,410

Capital Recovery Factor 0.1424

f

Total Annualized Cost Per Facility $5,537

Total Annualized Cost for the OSWRO 

Source Categorye $271,313

Minor discrepancies are due to rounding.

a Median of number of PRDs reported in responses to a questionnaire sent to OSWRO facilities in 2013 under the 

authority of CAA section 114. 

b Device cost is average of range provided.

c Chemical Engineering Index for 2007 is 525.4 and 584.6 for 2012.

d Calculated using sixth-tenths rule. Facility Cost ($) = PRD Unit Cost ($) * (No. of PRDs)^0.6

e Total costs for the source category based on 49 facilities that will be subject to these requirements.

f Capital recovery factor calculated based on 7 percent interest and 10 year equipment life.