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R Incorporated Providing Environmental Technical Support Since 1989

501 Eastowne Drive, Suite 325 y Chapel Hill, North Carolina 27514 Telephone: (919) 484-0222 y Fax: (919) 484-0122 MEMORANDUM

DATE: February 11, 2010

SUBJECT: Cost per Ton of HAP Reduced for Existing Stationary CI RICE

FROM: Bradley Nelson and Tanya Parise, EC/R, Inc.

TO: Melanie King, EPA OAQPS/SPPD/ESG

1.0 PURPOSE

The purpose of this memorandum is to present the cost per ton of emissions reduced by applying controls to existing stationary co mpression ignition (CI) reciprocating internal combustion engines (RICE) less than or equal to 500 horsepower (HP) located at major sources subject to National Emission Standards fo r Hazardous Air Pollutants (NESHAP).

2.0 INTRODUCTION

EPA has extensively discussed the various ex haust aftertreatment controls available to stationary CI engines in background documentati on for previous rulemakings. The applicable add-on controls for stationary CI engines include add-on control technolo gies based on oxidation and/or reduction of pollutants. The add-on control technologies discussed in this memorandum are diesel oxidation catalysts (DOC) a nd open crankcase ventilation (OCV)

3.0 COST OF CONTROLS

The capital and annual cost of controls were developed using equipment cost information obtained from control technology vendors and st ate agencies and the estimation methodology

outlined in the EPA Air Pollution Control Cost Manual. 1 The development of the cost equations for each of the applicable control technologies is presented in a control cost memorandum. 2 EPA determined that the following cost equations in Table 2 are representative of the applicable addon controls to be considered for stationary CI engines.

1 EPA Air Pollution Control Cost Manual Sixth Edition, January 2002, EPA/452/B-02-001.

2 Memorandum from Bradley Nelson, EC/R Inc., to Melanie King, EPA OAQPS/SPPD/ESG, Control Costs for Existing Stationary CI RICE (see EPA-HQ-OAR-2008-0708).2 Table 2. Summary of Capital and Annual Costs for Diesel HAP Control Technology

Technology Capital Cost ($2008) Annual Cost ($2008)

DOC $27.4 x HP - $939 $4.99 x HP + $480

OCV $0.26 x HP + $997 $0.065 x HP + $254

4.0 EMISSION REDUCTIONS

In order to estimate the baseline emissi ons of HAP, PM, volat ile organic compounds (VOC), and sulfur dioxide (SO 2 ) from stationary engines a ffected by this rulemaking, EPA

obtained HAP emission factors from the memo randum “Development of HAP Emission Factors for Small ( ≤ 500 HP) Stationary Reciprocating Intern al Combustion Engines (RICE)” (EPA-HQOAR-2005-0030-0009). Using the un controlled HAP emission fact ors in conjunction with previously well-accepted assumptions listed below, EPA estimated the uncontrolled HAP emissions per year per subcategory. EPA then estimated the emissions reductions per engine subcategory.

Assumptions:

• Stationary prime CI engines annual operation: 1,000 hrs/yr

• Stationary emergency CI engine s annual operation: 50 hrs/yr

• Uncontrolled CI HAP emissions: 1.07 x 10 -4 lb/HP-hr

• Uncontrolled CI PM emissions: 7.00 x 10 -4 lb/HP-hr

• Uncontrolled CI VOC emissions: 2.47 x 10 -3 lb/HP-hr

The cost per ton of HAP, PM, and VOC reduced for the DOC/OCV add-on control technology options for emergency and non-emergenc y engines are presented in Tables 3, 4, and

5.3Table 3. Cost per ton ($/ton) of HAP Reduced1per Engine ($2008)< 50 HP 50–100 HP 100–175 HP 175-300 HP 300-500 HP 500-600 HP 600-750 HP > 750 HPCI Prime Engines(DOC + OCV)$632,888 $380,463 $265,225 $207,583 $170,108 $162,459 $156,085 $146,969CI Emergency Engines(DOC + OCV)$17,706,275 $7,609,257 $5,304,503 $4,151,664 $3,402,166 $3,249,181 $3,121,693 $2,939,3861HAP reductions are estimated to be 70% based on the use of DOC and OCV.Table 4. Cost per ton ($/ton) of PM Reduced1per Engine ($2008)< 50 HP 50–100 HP 100–175 HP 175-300 HP 300-500 HP 500-600 HP 600-750 HP > 750 HPCI Prime Engines(DOC + OCV)$225,730 $135,698 $94,597 $74,038 $60,672 $57,944 $55,670 $52,419CI Emergency Engines(DOC + OCV)$6,315,238 $2,713,968 $1,891,939 $1,480,760 $1,213,439 $1,158,874 $1,113,404 $1,048,3811PM reductions are estimated to be 30%based on the use of DOC and OCV.Table 5. Cost per ton ($/ton) of VOC Reduced1per Engine ($2008)< 50 HP 50–100 HP 100–175 HP 175-300 HP 300-500 HP 500-600 HP 600-750 HP > 750 HPCI Prime Engines(DOC + OCV)$27,417 $16,482 $11,490 $8,992 $7,369 $7,038 $6,762 $6,367CI Emergency Engines(DOC + OCV)$767,033 $329,632 $229,790 $179,849 $147,381 $140,754 $135,231 $127,3341VOC reductions are estimated to be70% based on the use of DOC and OCV.4 4.0 BENEFITS

The benefits per ton of PM and SO 2 at 7 percent interest rate are shown in Table 3. For

more information on the benefits per ton of pollutant s reduced and total monetized benefits, please refer to the “Regulatory Impact Analys is (RIA) for Existing Stationary Compression Ignition Engines NESHAP,” which can be found in the docket (EPA-HQ-OAR-2008-0708).

Table 3. Summary of PM and SO 2 Benefit per Ton for Existing Stationary CI Engines

Pollutant Benefit per ton (Pope, 7%) Benefit per ton (Laden, 7%) Major Area Major Area

PM $210,000 $330,000 $500,000 $790,000

SO 2 $27,000 $18,000 $65,000 $44,000