Dayana Medina 

U.S. Environmental Protection Agency, Region 6 

Multimedia Planning and Permitting Division 

Air Planning Section (6PD-L) 

1445 Ross Avenue 

Dallas, TX 75202 

Re: Application for BART Determination for S02 and NOx 

At the Flint Creek Power Plant, Gentry, Arkansas (AFIN 04-00107) 

Dear Ms. Pettyjohn and Ms. Medina: 

Below are the responses to each of the questions/requests sent to Southwestern Electric Power 

Company (SWEPCO) on February 25, 2013, regarding the cost evaluation for S02 control 

technologies evaluated in the BART five factor analysis for the Flint Creek Power Plant. This 

revision of the BART submittal includes updated cost component information that clarifies the 

scope of the project and provides a more direct comparison between the technologies included in 

the evaluation. For BART purposes only, some cost components were removed entirely to 

support this clarity. In addition, we have reformatted the cost spreadsheet to show side-by-side 

comparisons of the costs for each control option as estimated by our engineers, and side-by-side 

comparisons of the cost values for each control option as derived from EPA's Control Cost 

Manual (CCM). Please find the new spreadsheet attached, and note the new tab, "CostsFGDs," in which columns J and L contain CCM-based estimates for each control option and 

columns 0 and Q contain our engineer's estimates for each control option. Notes have been 

added where the estimates have been updated or revised to respond to your comments. 

We also are providing an updated report that includes the updated cost information (based on the 

attached spreadsheet) as well as new modeling information developed in response to the 

"Modeling and Emission Estimates" questions in the email dated February 8, 2013. The updated 

modeling files will be uploaded to the same FTP site as used previously. 

We are writing to explain in more detail how the engineering cost estimates for the two S02 

control options differ, and how each provides a more detailed and more accurate value than the 

costs obtained by using the default assumptions in EPA's CCM. The novel integrated 

desulfurizationldry flue gas desulfurization (NID/DFGD) cost estimate is a Class 3 estimate per 

AACE International standards, developed by AEP's internal engineering team based on a nearly 

year-long (and ongoing) detailed site-specific evaluation. This estimate (or later iterations of it) 
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The estimated cost for the wet flue gas desulfurization (WFGD) option was generated based on 

the actual cost of the Conesville, OH Unit 4 WFGD project, as adjusted for known differences 

between Conesville Unit 4 and the Flint Creek unit. Except where noted, no attempt was made to 

make the WFGD estimate site-specific, and it is assumed to be the equivalent of a high level, 

indicative AACE Class 5 estimate. This project was completed in 2010, and did not use the 

same Work Breakdown Structure (WBS) currently used to develop the NID/DFGD estimate. 

Therefore, available cost information was allocated to the various WBS areas as a "best fit" 

based on the known components in the actual cost breakdown. Because Conesville Unit 4 is a 

larger unit, each amount was factored to reflect the MW ratio of Conesville Unit 4 to Flint Creek, 

and then escalated to 2016 base year dollars. A more detailed site-specific WFGD estimate for 

Flint Creek cannot be performed without a large investment in project team resources and 

conceptual/feasibility engineering and design time. Without a full WFGD site evaluation 

specific to the Flint Creek site, it is likely that certain associated project or balance-of-plant costs 

have not been included, and therefore the costs are not as accurate as the NID/DFGD estimate. 

This estimate therefore has a much wider range of accuracy on the order of -30% to +50%. 

We have borrowed the headings used in your February 25, 2013 email to set off the specific 

responses that affect both cost estimates, and the specific technology estimates. However, 

certain of the bullets included in the NIDS section appeared to be related to the WFGD estimate. 

If we have misinterpreted your question, please let us know. We have numbered the responses to 

each bulleted item and supplied a topic reference at the beginning of each response for the sake 

of clarity. 

Wet Scrubber and NIDS Cost Estimates 

1. AFUDC Costs. 

Allowance for Funds Used During Construction (AFUDC) represents the real cost of financing 

the debt incurred to undertake construction of the capital-intensive types of controls being 

evaluated. However, consistent with the CCM examples, AFUDC has been set equal to zero in 

all estimates in the updated spreadsheet. 

2. CEMS, CEMS Building, and Warehouse. 

CEMS-related costs have been excluded from all of the estimates in the updated spreadsheet. 

The warehouse costs remain in all estimates as this is a building that is necessary for 

implementation of either of the control options. The warehouse is used during construction for 
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The expenses accounted for under line item 901 ("Outside Professional Services") include 

allowances for estimated start-up technical support, specialty testing, and engineering services. 

These services include, but are not limited to, geophysical testing, surveying, and other similar 

professional services. 

Line item 970 ("AEP Services") includes project management, engineering, project controls, 

procurement, construction and start-up supervision provided by AEP Service Corporation personnel. AEP Service Corporation is an affiliated services company that provides engineering, 

accounting, legal and other shared services to the AEP operating companies on a shared basis 

under agreements approved by the Federal Energy Regulatory Commission. Utilities that do not 

have an affiliated services company secure these same services from outside contractors. 

The expenses accounted for under line item 010 ("Existing Conditions") includes site specific 

activities necessary for the construction of the project such as removal of existing facilities and 

equipment, asbestos abatement, and lead paint remediation work at tie-in points for the new 

control equipment. 

The expenses included in line item 770 ("Controls Modernization") is for the work required to 

upgrade the unit's existing control systems to interface with the controls for the new NID/WFGD 

equipment. The previous estimate for the NID included separate costs on this same line item for 

the controls that will be installed as part of the NID system. For the sake of clarity, all of the 

new controls associated with the NID and the WFGD systems are now included in the total 

capital cost of the control technology. Line item 770 ("Controls Modernization") includes only 

those costs associated with upgrading and interfacing the existing unit controls. 

4. Allocations. 

Allocation costs have been removed from all estimates in the updated spreadsheet. 

5. Cost of Electricity. 

The estimated cost of electricity has been specified in terms of $/kWh and as a dollar amount, 

and is included in the updated spreadsheet. 
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modifications would be needed for the WFGD option than the NIDS option, but as more detailed 

engineering has not been performed for this option, costs are conservatively assumed to be equal 

to the NIDS option estimate in the updated spreadsheet. 

7. Basis for Cost Estimates. 

All costs values are estimated in 2016 base year dollars. 

8. Process Island Building. 

For the NID control option, the process island building houses lime preparation and delivery 

systems, and the costs include, but are not limited to, foundations, structural components, 

fluidized air enclosure, stair tower and elevator, siding, louvers, hopper enclosure, penthouse, 

and electrical grounding. 

For the WFGD control option, the process island building houses limestone preparation, 

delivery, and dewatering systems, and the costs include, but are not limited to, foundations, 

structural components, stair tower and elevator, siding, louvers, and electrical grounding. The 

WFGD process building is significantly more complex due to the size and weight of the 

necessary equipment, especially the limestone preparation and water requirements not necessary 

for the NID. 

NIDS Cost Estimate 

1. Rail Improvements. 

A new rail spur will be required at the Flint Creek facility for either control option. The NID 

equipment uses lime, which will be delivered by rail and requires special pneumatic off-loading 

equipment. The WFGD equipment uses limestone so estimates for heavier rail facilities and 

different off-loading equipment associated with handling this bulk stone material are included in 

the WFGD estimate summary. 

2. Site Development Costs. 

The site development costs estimated for the NID controls are based on site-specific 

requirements for large lay down and fabrication areas and associated access due to the unique 

nature of the site and delivery options available at Flint Creek. For consistency in the summary 

estimates, it is assumed that similar lay down and fabrication areas and associated access will be 
CEMS-related costs have been excluded from all of the estimates in the updated spreadsheet. 

4. Fabric Filter. 

The WFGD estimate has been updated to reflect an estimated $40 million cost for the fabric filter 

based on the latest vendor quote. The NID is an integrated system, and the breakout for the 

fabric filter cost was supplied by the vendor. 

5. DFGD- NID Controls. 

As explained above, the procurement cost of the hardware and software specific to the NID and 

WFGD controls are now included in the total direct cost of the control technology. The 

"Controls Modernization" cost in line 770 is the cost to upgrade and interface the existing unit 

controls with the new NID/WFGD systems. 

6. Plant Security and Communications. 

"Plant Security and Communications" includes the equipment and installation associated with 

telephone and other communication devices necessary for the safety and security of the 

employees and the plant. This equipment is necessary upon installation of either of the S02 

control options because of the need to maintain communications between personnel in the 

existing plant locations and the new process island building, unloading areas, and other remote 

locations associated with the new controls. 

7. Contingencies. 

Line item 980 ("Contingency") has been removed from both estimates to improve the basis of 

comparison between different AACE Class estimates. Contingency has not been determined for 

the WFGD estimate and would typically be developed at the end of a site-specific conceptual 

design and estimate effort. 
The fabric filter cannot be excluded from the WFGD cost estimate and compared to an integrated 

NID system, because installation of WFGD alone would not allow Flint Creek to achieve 

compliance with both the Regional Haze Rule and the additional obligations imposed on this unit 

under the MATS rule. Currently Flint Creek has an existing hot-side electrostatic precipitator 

(ESP). The combination of the existing ESP and the WFGD will not enable Flint Creek to 

achieve both the S02 control required for Regional Haze compliance, and the mercury and 

particulate matter limits necessary to satisfy MATS. Accordingly, planning to install WFGD 

alone would leave Flint Creek with no remaining useful life, and be a futile control strategy. 

Although ACI will also be required to achieve MATS compliance, this additional cost is the 

same regardless of which S02 control option is chosen, so it has been eliminated from both cost 

estimates. 

In the BART Guidelines, EPA noted that the MACT standards developed for many of the 

BART -eligible source categories could help states streamline their analysis, since MACT -level 

controls represent "the best-controlled 12 percent of sources in the industry." 70 Fed. Reg. 

39,163 (July 6, 2005). EPA has encouraged sources to investigate comprehensive control 

strategies to address the multiple standards that will take effect over the BART implementation 

period. See, Letter dated July 18, 2012, from Gina McCarthy, Assistant Administrator, EPA, to 

Stuart Solomon, President, Public Service Company of Oklahoma. In order to have a viable 

control strategy and compare WFGD to the NID technology (which includes an integrated fabric 

filter as part of its design and will achieve all of the applicable standards under both rules) a 

fabric filter was included in the WFGD control option. 

2. Boiler Modifications. 

As explained above, of a furnace imaging system and intelligent soot-blowing system have been 

included for both control strategies. It is expected that more extensive boiler modifications 

would be needed for the WFGD option than the NIDS option, but as more detailed engineering 

has not been performed for this option, costs are conservatively assumed to be equal to the NIDS 

option estimate in the updated spreadsheet. 

3. JBR Repair Costs. 

This line item has been eliminated from the WFGD cost estimate. 

4. Contingencies. 

No contingencies have been included in the estimates. 
2013. If you have additional questions, it may be productive to meet in Dallas and provide an 

opportunity for SWEPCO and AEP personnel to answer questions directly. Please contact me at 

(214) 777-1113 to make arrangements for such a meeting, or to provide any additional 

information you may require. 

Very truly yours, 

Kristen P. Gaus