Final Draft Staff Report for 

Revised Proposed Rule 4308

SAN JOAQUIN VALLEY UNIFIED AIR POLLUTION CONTROL DISTRICT

FINAL DRAFT STAFF REPORT

Revised Proposed Rule 4308

(Boilers, Steam Generators, and Process Heaters -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

October 20, 2005

Prepared by: Daniel Garcia, Air Quality Specialist

Reviewed by: Joven R. Nazareno, Senior Air Quality Engineer

George Heinen, Supervising Air Quality Engineer

Maria Stobbe, Planning Manager 

I. SUMMARY

A. Reasons for Rule Development and Implementation

The California Air Resources Board (ARB) and the U.S. Environmental Protection 

Agency (EPA) classify the San Joaquin Valley Air Basin (SJVAB) as a nonattainment 

area for the state and federal health based ambient ozone and particulate matter 

10 microns in size and smaller (PM10) standards. Currently, the SJVAB is classified as 

serious nonattainment for the 24-hour and annual National Ambient Air Quality 

Standards (NAAQS) for PM10, serious nonattainment for federal ozone standards, and 

severe nonattainment for the state ozone standard.

The San Joaquin Valley Unified Air Pollution Control District (District) adopted its 2003 

PM10 Attainment Demonstration Plan on June 19, 2003, which projects attainment of 

the NAAQS for PM10 at the earliest practicable date of December 31, 2010. As part of 

its PM10 attainment strategy, the District is required to reduce directly emitted PM10 

and the PM10 precursors, oxides of nitrogen (NOx). The 2003 PM10 Plan commits the 

District to develop new rules or amend existing rules to achieve these emission 

reductions. Additionally, the California Clean Air Act (CCAA) requires the District to 

adopt all feasible control measures to attain the standards. 

As a serious ozone nonattainment area, the SJVAB is required by the federal Clean Air 

Act (CAA) to attain the NAAQS for ozone by June 15, 2013. In order to achieve 

attainment by 2013, the District is required to prepare a new ozone plan that will need 

additional commitments to reduce emissions of ozone precursors, [NOx, and volatile 

organic compounds (VOCs)].
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

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B. Description of the Project 

The primary objective of this project is to develop new Rule 4308 (Boilers, Steam 

Generators, and Process Heaters – 0.075 MMBtu/hr to 2.0 MMBtu/hr) to establish NOx 

emissions limits. The District is proposing to develop Rule 4308 to achieve emission 

reductions committed to in the 2003 PM10 Plan.

II. BACKGROUND

A. Source Description

Based on a survey of the SJVAB conducted by Pacific Environmental Services (PES) in 

2001 there are an estimated 4,228 units with a heat input rating between 0.075 

MMBtu/hr and 2.0 MMBtu/hr located in the District. According to the PES survey: 

• These units are usually found in manufacturing facilities, government 

facilities, general merchandise stores, restaurants, hotels, rooming houses 

and camps, cleaning service facilities, hospitals, educational institutions, 

religious organizations, and refineries. 

• 97% of the boilers are fueled by natural gas; other fuels reported were 

liquefied propane and distillate oil. Those devices surveyed by PES that 

do not use natural gas are in operation at schools. The fuel type is 

important when considering control technology. 

• The survey reported that the median age for all unit types in the SJVAB 

was 13 years.

In the PM10 Plan, the District estimates that 39.8 tons per day (tpd) of NOx and 5.1 tpd 

of SOx are emitted in the SJVAB from this source category. Staff discussions with 

stakeholders and a review of the South Coast Air Quality Management District 

(SCAQMD) emissions analysis for Rule 1146.2 indicated a need for District staff to 

improve the estimated number of units in the SJVAB and emissions associated with this 

source category. District staff has further refined the estimated number of units and the 

annual emissions for this source category in the emission reduction analysis 

(Appendix B).

B. BACM (Best Available Control Measures) Analysis

According to the 2003 PM10 Plan, NOx and SOx emissions from industrial, commercial, 

industrial and institutional small boilers, steam generators, process heaters and water 

heaters exceed the “de minimus threshold” levels and are therefore subject to federal 

BACM requirements. BACM is defined as the maximum degree of emission reductions 

considering technical feasibility, economic feasibility and environmental impacts of 
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

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available emission controls. The CAA requires nonattainment areas for PM10 to 

implement BACM on all significant sources of PM10 and PM10 precursors.

District staff prepared a BACM analysis; staff used the EPA Technology Transfer 

Network Clean Air Technology Center Clearinghouse and other rules and regulations to 

identify BACM controls and limits for this source category. The emission control 

strategies currently utilized by smaller units (0.075 MMBtu/hr to 0.3 MMBtu/hr) include 

radiant, two-stage, non-aerated, and ribbon burner technologies. These technologies 

work by lowering peak flame temperature and reducing the amount of air flowing to the 

burner. These emission control strategies are also used in larger units (0.3 MMBtu/hr 

up to but not including 2.0 MMBtu/hr). Completion of the BACM Analysis demonstrated 

that units subject to proposed Rule 4308 must meet or exceed the federal BACM level 

of emission controls. 

C. All Feasible Control Measures 

To satisfy the requirements of the California Clean Air Act the ARB mandates that “At a 

minimum, a district consider regulations that have been successfully implemented 

elsewhere.” Additionally, ARB states “They (districts) should also consider going 

beyond what has already been accomplished by evaluating new technologies and 

innovative approaches that may offer potential emission reductions.” Further, ARB 

includes “districts should consider not only technological factors, but also social, 

environmental economic, and energy factors which prevail in the district, along with the 

resources realistically available to the district to adopt, implement, and enforce the 

measures.” To meet those requirements, the District has identified all feasible control 

measures and has determined that proposed Rule 4308 does meet every feasible 

control measure. 

The SCAQMD has an existing NOx emission limit of 0.093 lb/MMBtu of heat input for 

units with a heat input rating between 0.075 MMBtu/hr and 0.4 MMBtu/hr and 

manufactured after January 1, 2001. The SCAQMD also has an existing NOx emission 

limit of 0.036 lb/MMBtu of NOx (corrected to 3% O2, dry) for units with a heat input rating 

between 0.4 MMBtu/hr and 2.0 MMBtu/hr and manufactured after January 1, 2000. 

Considering the attainment status of the SJVAB, it is necessary for the District to 

implement similar or equally stringent emission limits as those set by the SCAQMD, 

which is nonattainment for federal PM10 and ozone standards, and nonattainment for 

state PM10 and ozone standards. 

III. DISCUSSION

A. Source Category

The technology required to reduce NOx emissions is currently available. Most small 

boiler manufacturers offer at least one model that meets or exceeds the limits proposed 
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

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in draft Rule 4308. A boiler or water heater typically has a life span of over a decade 

before it needs to be replaced. Based on an implementation study conducted by the 

SCAQMD the average useful life of boilers, with a rated heat input between 0.4 

MMBtu/hr and 2.0 MMBtu/hr, is 15 years. The implementation study does not define 

the average useful life of boilers, with a rated heat input between 0.075 MMBtu/hr and 

0.4 MMBtu/hr, because the requirements set-forth in the SCAQMD Rule 1146.2 for this 

size range of boilers are attrition based. Survey results, published in 2001 by PES, 

concluded that the median age of existing small boilers and water heaters in the 

SJVAB, with heat input ratings of 5.0 MMBtu/hr and less, is 13 years of age. Due to the 

age of these boilers and water heaters, PES found that many lack emission controls 

common to currently manufactured units.

B. Control Technology

Emission control strategies generally fall into two categories. Typically, these control 

systems are successful in simultaneously attaining low-NOx and CO emission levels. 

Low – NOx technology is available for smaller units (less than 0.3 MMBtu/hr) and larger 

units (between 0.3 MMBtu/hr and 2.0 MMBtu/hr). These technologies work by lowering 

peak flame temperature and reducing the amount of air flowing to the burner. 

• Control Technology for Units With a Heat Input From 0.075 MMBtu/hr up to but 

not including 0.3 MMBtu/hr 

There are several burner technologies that have been available for commercial units 

prior to 1982. The burner technologies that are available to meet the proposed NOx 

emission limits include radiant, two–stage, non-aerated, and ribbon burners. These 

technologies work by lowering the peak flame temperature and reducing the amount of 

air flowing to the burner. 

• Control Technology for Units With a Heat Input Greater than 0.3 MMBtu/hr up to 

but not including 2.0 MMBtu/hr 

For units with a rated heat input that is greater than 300,000 Btu/hr manufacturers add a 

fan to force combustion air into the unit. A fan assists in adjusting the distribution of air 

and fuel to the combustion zone (staging combustion). Decreasing excess oxygen (or 

air) decreases NOx emissions. This mechanism reduces heat loss through the stack. 

A reduction in air that is combusted decreases the quantity of air that must be heated, 

therefore less heat is required. The reduction of excess air and other types of low-NOx 

strategies also improve fuel efficiency. 

Lowering the peak flame temperature of combustion and/or reducing the oxygen 

available at the peak flame temperature are achieved through burner design. This is 

usually accomplished by delaying the introduction of a portion of the combustion air to 

the flame or by spreading the flame out across a surface so that it burns cooler. 
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

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There are two primarily low-NOx burner designs: forced draft low-NOx and power 

premix. In the forced draft low-NOx, burner the unit is designed such that air and fuel 

are delivered separately to the burner. The combustion process is controlled inside the 

burner, creating a good mix of air and fuel for complete combustion. This process 

lowers the peak temperature with sufficient air to burn all of the natural gas. Power 

premix low-NOx burners are designed such that air and fuel are mixed outside of the 

boiler. A fan is used to push air into the unit and the gas is mixed in an air pipe. The 

combined air and fuel mixture is combusted on a porous substrate that acts as a burner, 

which holds and stabilizes the flame. This design controls the amount of air in the 

mixture and allows the flame to be distributed broadly across a surface. This design 

also lowers the peak flame temperature. 

C. Summary of the Proposed Rule 4308

District Rule 4308 is designed to limit NOx emissions from commercial, industrial and 

institutional small boilers, steam generators, process heaters and water heaters. Rule 

4308 addresses both adequate control and mitigation requirements. The proposed rule 

is summarized in the following paragraphs.

• Section 1.0 - Purpose

The purpose of the rule is to limit emissions of oxides of nitrogen (NOx) from boilers, 

steam generators, process heaters and water heaters.

• Section 2.0 - Applicability

The rule applies to any person who supplies, sells, offers for sale, installs, or solicits 

the installation of any new small boiler, steam generator, process heater or water 

heater with a rated heat input capacity greater than or equal to 0.075 MMBtu/hr up to 

but not including 2.0 MMBtu/hr. Other existing or proposed District rules address units 

2.0 MMBtu/hr and greater.

• Section 3.0 - Definitions

This section details key definitions used in this rulemaking:

Boiler or Water Heater: any external combustion equipment fired with a liquid or 

gaseous fuel to produce hot water or steam.

Humidifier: a device or system that uses an air stream heated by a direct contact 

combustion process in combination with a water spray to produce warm air of high 

humidity in order to maintain or increase the moisture content of the material being 

processed or conveyed by the air stream.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

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Process Heater: any combustion equipment fired on liquid or gaseous fuel, which 

transfers heat from combustion gases to water or process streams. Process heaters 

exclude kilns or ovens used for drying, baking, cooking, calcining, heat treating or 

vitrifying. 

• Section 4.0 – Exemptions

This section exempts manufactured homes and humidifiers, which is an exemption 

commonly found in similar rules. Humidifiers are being exempted from this rule based 

on the premise that they do not fall within the definition of boilers, process heaters and 

steam generators. However, humidifiers would be evaluated as a potential control 

measure in the 8-hour ozone plan.

• Section 5.0 – Requirements

The requirements in section 5.0 will satisfy all feasible control measures. Section 5.0 

Prohibits a person from supplying, selling, offering for sale, installing or soliciting the 

installation of any new unit after January 1, 2007 that does not meet the NOx and 

CO emissions limits in Table 1.0.

• Section 6.0 – Administrative Requirements

This section details emission certification testing requirements for manufacturers and 

District certification requirements.

Table 1.0 - NOx and CO limits for Proposed Rule 4308

Boiler/Heater Size

Heat Input Capacity

(MMBtu/hr)

NOx Limit CO Limit

0.075 < X < 0.4

0.093 lb of NOx/MMBtu of 

heat output at 3% stack gas 

oxygen by volume on a dry 

basis.

Not Applicable.

0.4 < X < 2.0

0.036 lb of NOx/MMBtu of 

heat input at 3% stack gas 

oxygen by volume on a dry 

basis.

400 ppm at 3% stack 

gas oxygen by volume 

on a dry basis.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Final Draft Staff Report Rule 4308 October 20, 2005

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• Section 7.0 – Compliance Schedule

The rule provisions are effective January 1, 2007, to allow time for certification of 

units and “sell-through” of existing stock.

IV. RULE DEVELOPMENT PROCESS

District staff conducted first workshops on June 8 and 9, 2005 to present the first draft 

rule and draft staff report. After the first workshops, staff gathered data on the cost of 

complying with the draft rule requirements. State law requires a socioeconomic study, 

which demonstrates the potential effects of a rule, so that these impacts may be 

considered and mitigated if necessary. District staff conducted a socioeconomic 

analysis and presented the socioeconomic report at a second workshop held on August 

2 and 3, 2005. Staff found that Rule 4308 will minimally impact stakeholders in part due 

to the ready availability of the applicable burners that comply with the requirements of 

the proposed rule.

V. EMISSION INVENTORY AND POTENTIAL EMISSION REDUCTIONS

District staff used capacity factor information and average emission rates derived by the 

SCAQMD to determine baseline emissions and emission reductions pertinent to

Proposed Rule 4308. The SCAQMD calculated capacity factors and emission rates for 

units subject to SCAQMD Rule 1146.2 (Large Water Heaters and Small Boilers) by 

gathering data from boiler manufacturers and conducting a statistical survey. Proposed 

District Rule 4308 will regulate the same class and size of units like those subject to 

Rule 1146.2. Therefore, District staff has used capacity factors, emission rates and 

population estimates for the emissions analysis that are similar to those used in the 

SCAQMD final staff report on Rule 1146.2. The calculated NOx emissions baseline for 

this source category is 3.3 tpd. The overall estimated NOx emissions reduction is 2.0 

tpd. The emissions and emissions reductions analysis from sources affected by this 

draft rule can be found in Appendix B of this staff report.

VI. COST EFFECTIVENESS ANALYSIS

In an effort to provide that public and the District’s Governing Board with concise 

information on the possible cost scenarios for this proposed rule, District staff has 

conducted a cost effectiveness analysis, which can be found in Appendix C of this staff 

report. The estimated cost effectiveness ranges from a cost savings of $1,108 to $2,775 

per ton of NOx reduced for larger units, and the cost effectiveness for smaller units range 

from $187 to $5,385 per ton of NOx reduced.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Final Draft Staff Report Rule 4308 October 20, 2005

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Revised Proposed Rule 4308

VII. SOCIOECONOMIC ANALYSIS

Pursuant to state law, the District is required to perform a socioeconomic impact 

analysis prior to the adoption, amendment, or repeal of a rule, which has significant air 

quality benefits as a consequence of more stringent emission control requirements. 

Staff has conducted an in-house socioeconomic study of this rule’s impact on the 

regional economy. The study includes the following information: (1) compliance options 

that affected stakeholders will most likely choose in order to comply with the 

requirements, (2) costs incurred to comply with the rule, and (3) potential stakeholder 

responses to cost. The analysis indicated that the rule would not produce a significant 

impact on affected sources. The socioeconomic analysis can be found in Appendix D of 

this staff report.

VIII. ENVIRONMENTAL IMPACT ANALYSIS

No significant adverse impacts are expected as a result of this proposed rule. Pursuant 

to the California Environmental Quality Act (CEQA), staff will prepare a Notice of 

Exemption for this project.

IX. RULE CONSISTENCY ANALYSIS

Pursuant to state Health and Safety Code, Section 40272.2, District staff has prepared 

a rule consistency analysis of draft Rule 4308. The rule consistency analysis for draft 

Rule 4308 can be found in Appendix E of this draft staff report. 

X. REFERENCES

Emissions Inventory Improvements for Selected Source Categories prepared by Pacific 

Environmental Services Inc. on External Combustions Boilers, Steam Generators and 

Process Heaters, published July 6, 2001.

Santa Barbara County Air Pollution Control District Rule 360 (Emissions of Oxides of 

Nitrogen from Large Water Heaters and Small Boilers), Adopted October 17, 2002. 

SCAQMD Final Staff Report for Rule 1146.2 adopted January 9, 1998.

SCAQMD Rule 1146.2 (Emissions of Oxides of Nitrogen from Large Water Heaters and 

Small Boilers), Adopted January 9, 1998 and Amended January 7, 2005.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix A: Comments and Responses for Rule 4308 October 20, 2005

A - 1 Final Draft Staff Report for 

Revised Proposed Rule 4308

APPENDIX A

Comments and Responses for

Rule 4308 (Boilers, Steam Generators, and Process Heaters -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

October 20, 2005
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix A: Comments and Responses for Rule 4308 October 20, 2005

A - 2 Final Draft Staff Report for 

Revised Proposed Rule 4308

SUMMARY OF COMMENTS AND RESPONSES

FROM OPEN COMMENTING PERIOD PRIOR TO GOVERNING BOARD 

ADOPTION OCTOBER 20, 2005

EPA Comments:

No comments received.

ARB Comments:

No comments received.

Industry Comments:

Stakeholder’s verbal and written comments:

California Cotton Ginner Association (CCGA)

1. Comment: Humidifying units used to add moisture to cotton in the final ginning 

stage are unique in that the products of combustion come into direct contact with 

water to create steam which is in turn directly emitted into the flow of cotton lint. 

The nature of this process prohibits the installation and operation of any type of 

flue gas re-circulation or exhaust gas control system. This limits controls on 

cotton gin humidifying units to only burner modifications, which may or may not 

exist and that may have significantly higher costs than existing conventional 

burners (CCGA).

Response: The Districts has determined that humidifiers operate in such a 

manner that the combustion gas directly contacts the material that is being 

processed. Thus, humidifiers do not fall within the definition of a boiler, steam 

generator, or process heater. The humidifying process is similar to that of kilns 

and smelters that are currently exempt in existing SIP - approved Rule 4305 

(Boilers, Steam Generators and Process Heaters – Phase 1) and existing Rule 

4306 (Boilers, Steam Generators, and Process Heaters – Phase 2). Provided 

the definition of humidifiers and the precedent rules the District will exempt 

humidifiers from the Revised Proposed Rule 4308. District staff will evaluate the 

technological feasibility of lower emitting humidifying units as a separate control 

measure during the development of the District’s 8-hour ozone attainment plan.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix A: Comments and Responses for Rule 4308 October 20, 2005

A - 3 Final Draft Staff Report for 

Revised Proposed Rule 4308

SUMMARY OF COMMENTS AND RESPONSES

FROM THE WORKSHOPS

HELD ON AUGUST 2 & 3, 2005

EPA Comment:

No comments were received.

ARB COMMENT:

No comments were received.

INDUSTRY COMMENTS:

Stakeholders Submitting Comments:

Building Industry Association (B.I.A.)

1. Comment: Stakeholders expressed a concern regarding the availability of 

instant water heaters that are capable of meeting the NOx emissions limits 

proposed by the District in Rule 4308 (B.I.A.).

Response: There is a number of instant water heating units that are compliant 

with Proposed Rule 4308 and that are available from manufacturers. Some of 

these units are listed by the SCAQMD certification list for Rule 1146.2. Proposed 

Rule 4308 accepts units that are listed by the SCAQMD certification list as 

compliant units.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix A: Comments and Responses for Rule 4308 October 20, 2005

A - 4 Final Draft Staff Report for 

Revised Proposed Rule 4308

SUMMARY OF COMMENTS AND RESPONSES

FROM THE WORKSHOPS

HELD ON JUNE 8 & 9, 2005

EPA Comment:

1. Comment: The purpose (Section 1.0) of the rule is to limit NOx and SOx 

emissions, however, the draft rule does not contain any limits for SOx emissions.

Response: The NOx emission limits that the District is currently proposing 

require the units subject to Rule 4308 to be run on natural gas and which does 

not contain any SOx emissions. According to a 2001 survey taken by Pacific 

Environmental Service Inc. (PES) approximately 3% of the total boiler population 

in the SJVAB utilizes either liquefied propane or distillate oil. Thus, the District 

does intend to reduce a limited quantity of SOx emissions from units that are do 

not run on natural gas. Since the rule specifically does not contain SOx limits, 

the reference to a SOx reduction has been removed.

2. Comment: The last sentence of Subsection 6.2.1 should refer to Section 6.3 

instead of 5.3.

Response: District staff has made the necessary changes.

ARB COMMENT:

No comments were received.

INDUSTRY COMMENTS:

Stakeholders Submitting Comments:

R.F. MacDonald C.O. (R.F.)

3. Comment: The industry has requested that the District allow specific units that 

exceed the proposed NOx limits but are more fuel-efficient than some units that 

are capable of meeting the proposed limits. (R.F.)

Response: There are a number of compliant units available from 

manufacturers, which are listed by the SCAQMD certification list for Rule 1146.2. 

While some units may be more fuel-efficient than those that utilize low-NOx 

technology the emissions may be greater depending on the use of the unit. 

Additionally, the District may be unable to enforce the use of a fuel-efficient unit 

standard due to source test requirements and fuel. The District is open to 

additional suggestions and information on this subject.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix B: Emission Reduction Analysis for Rule 4308 August 2, 2005

B-1 Final Draft Staff Report for 

Revised Proposed Rule

APPENDIX B

Emission Reduction Analysis for

Rule 4308 (Boilers, Steam Generators, and Process Heaters -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

October 20, 2005
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix B: Emission Reduction Analysis for Rule 4308 October 20, 2005

B - 2 Final Draft Staff Report for 

Revised Proposed Rule 4308

ESTIMATED EMISSIONS FROM BOILERS, STEAM GENERATORS, AND

PROCESS HEATERS - 0.075 MMBtu/hr to 2.0 MMBtu/hr

SUMMARY

The District estimated in its 2003 PM10 Plan that 39.8 tpd of NOx and 5.1 tpd of SOx 

are emitted in the SJVAB from this source category. Stakeholders have indicated to 

staff that the emissions baseline and projected emission reductions from this source 

category should be refined to appropriately represent the inventory of units in the 

SJVAB and their emissions. In order to better reflect the emissions generated from 

commercial water heaters District staff researched the issue and revised the emissions 

baseline and projected emissions reductions for this source category. The District 

estimates that the NOx emissions from commercial water heaters are 3.3 tpd and the 

SOx emissions are 0.4 tpd. 

CALCULATION METHODLOGY

District staff gathered data from stakeholders, manufacturers and the SCAQMD to 

determine emission capacity factors, emission rates, average unit size and unit 

population. District staff extrapolated data from the SCAQMD’s staff report on Rule 

1146.2 (1997) to estimate the number of units located in the SJVAB. District staff 

calculated the population-to-unit ratio in order to derive the number and size of units 

needed to support the human population in the SJVAB. District Staff found that for 

every 350 people there is one unit in the size range of 0.075 MMBtu/hr to 0.4 MMBtu/hr 

and that for every 750 people there is one unit in the size range of 0.4 MMBtu/hr to 2.0 

MMBtu/hr. Multiplying Valley’s population of 3.6 million people by the population-to-unit 

ratios, District staff estimated the unit inventory shown in Table B-1. 

Table B-1: Estimated Unit Inventory

Total inventory of Units 15,300

Inventory between 0.075 and 0.4 MMBtu/hr 10,470 

Inventory between 0.4 and 2.0 MMBtu/hr 4,829

District staff also used the average emission rates derived by the SCAQMD. Due to the 

difference in emission rates for tank-type water heaters and water tube recirculating 

units, the baseline emissions were estimated separately for units below or above 

300,000 Btu/hr. For the smaller units, baseline emission rates from the SCAQMD Rule 

1146.2 development effort were used (74 nanograms/joule or 0.137 lb/MMBtu). For 

units above 0.4 MMBtu/hr, an emission rate of 0.17 lb/MMBtu was used. A summary of 

emission factors derived from South Coast rulemaking efforts are provided in Table B-2 

that is provided below.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix B: Emission Reduction Analysis for Rule 4308 October 20, 2005

B - 3 Final Draft Staff Report for 

Revised Proposed Rule 4308

Table B-2: Emission Rates from Various Sources

Data Source Emission Rate

PPM lb/MMBtu

Manufacturers 100 -180 0.12 - 0.22

SCAQMD Rule 1146.1 165 0.20

VCAPCD Rule 74.15.1 165 0.20

A capacity factor of 0.22 was used to develop baseline emissions. The capacity factor 

was derived by the SCAQMD and represents the fraction of fuel actually burned or 

consumed by the unit in a year compared to the theoretical maximum amount of fuel 

that a unit could be in a year. The latter amount would be calculated by assuming a unit 

operates and burns fuel continuously at its rated capacity. A 22% capacity factor was 

determined from the statistical survey conducted by the South Coast AQMD and was 

developed from unit operation and fuel usage information provided in that survey. 

District staff used the unit population, the emission rates and capacity factor to calculate 

the estimated NOx and SOx emission reductions upon the implementation of the draft 

rule requirements. 

Equations 1 and 2 below show the calculations to estimate baseline emissions. The 

methodology for the equations is also given. The number of units is based on a percent 

breakdown of the total unit inventory, which was derived by the SCAQMD. The break 

down estimates that 54% of the units (8,261 units) are less than 0.3 MMBtu/hr and that 

46% of the units (7,038 units) are greater than 0.3 MMBtu/hr.

Equation 1. - Emissions for Units < 0.3 MMBtu/hr

Emissions = (No. of units) x (average rating) x (emission rate) x (capacity factor)

 x (hours/day) x (lb/ton)

Emissions = 8,261 x 0.174 MMBtu/hr x 0.137 lb NOx/MMBtu x 0.22

 x 24 hr/day x 1 ton/2,000 lb

Emissions = 0.5 tons NOx/day

Equation 2. - Emissions for Units >0.3 MMBtu/hr

Emissions = (No. of units) x (average rating) x (emission rate) x (capacity factor)

 x (hours/day) x (lb/ton)

Emissions = 7,038 x 0.9025 MMBtu/hr x 0.17 lb NOx/MMBtu x 0.215

 x 24 hr/day x 1 ton/2,000 lb

Emissions = 2.8 tons NOx/day

Total baseline emission inventory of 3.3 (0.5 + 2.8) tons NOx per day tpd is estimated 

for this proposed rule.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix B: Emission Reduction Analysis for Rule 4308 October 20, 2005

B - 4 Final Draft Staff Report for 

Revised Proposed Rule 4308

EMISSION REDUCTION CALCULATIONS

Using the rule limits for units < 0.4 MMBtu/hr and units > 0.4 MMBtu/hr and their 

associated capacity factor and baseline emissions, the emissions reduction can be 

estimated as follows:

Emissions Reductions =

lb

tons

×

day

hrs

emissions × capacity factor × ΔNo. of Units × average rating×

For Units ≥ 0.075 MMBtu/hr to < 0.3 MMBtu/hr:

Emissions Reductions 1 =

day

0.2 ton

Emissions Reductions 1 = 

2,000 lbs

1ton

×

day

hr

× 0.22 × 24 MMBtu

lb 8,261× 0.174 MMBtu × ( 0.137- 0.074)

For Units > 0.3 MMBtu/hr to < 0.4 MMBtu/hr:

Emissions Reductions 2 =

day

tons

Emissions Reductions 2 = 0.2

 2,000 lbs

1ton

×

day

hrs

× 0.22 × 24 MMBtu

lb 2,209 × 0.35 MMBtu× ( 0.17- 0.074 )
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix B: Emission Reduction Analysis for Rule 4308 October 20, 2005

B - 5 Final Draft Staff Report for 

Revised Proposed Rule 4308

For Units > 0.4MMBtu/hr to < 2.0 MMBtu/hr:

Emissions Reductions 3 =

day

tons

Total Emissions Reductions = 2.0

day

tons

Emissions Reductions 3 = 1.6

 2,000 lbs

1ton

×

day

hrs

× 0.22 × 24 MMBtu

lb 4,829 × 0.9025 MMBtu × ( 0.17- 0 .032) *

Based on the start date and the age of the existing units, approximately 20% or 0.4 tpd 

NOx reductions should occur by the end of 2010. Full implementation is anticipated 15 

years after rule implementation or 2016.

*Considers 10% improvement in fuel efficiency. This leads to less fuel burned 

compared to older units. Thus, (1.0 - 0.10) (0.036 lb/MMBtu) = 0.032 lb/MMBtu 

equivalent emissions.

A better understanding of the emission inventory, and staff’s emissions reduction 

calculations indicate that this emission control will translate to a 2.0 ton per day 

reduction, compared to the 0.2 tpd reduction that is stated in the Districts 2003 PM10 

Plan for this source category. The implementation of Rule 4308 will surpass the 

emissions reductions of 0.2 tpd that the District has committed to in the 2003 PM10 

Additional emission reductions will occur in the future due to replacement of units. 

Ultimately, a 60% emissions control reduction should be achieved. 
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix B: Emission Reduction Analysis for Rule 4308 October 20, 2005

B - 6 Final Draft Staff Report for 

Revised Proposed Rule 4308

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SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 1 Final Draft Staff Report for

Revised Proposed Rule 4308

APPENDIX C

Cost Effectiveness Analysis for

Rule 4308 (Boilers, Steam Generators, and Process Heaters -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

October 20, 2005
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 2 Final Draft Staff Report for

Revised Proposed Rule 4308

COST EFFECTIVENESS ANALYSIS FOR

RULE 4308 (BOILERS, STEAM GENERATORS, AND PROCESS HEATERS –

0.075 MMBtu/hr to 2.0 MMBtu/hr)

I. INTRODUCTION

A cost effectiveness assessment is a requirement of the California Health and Safety 

Code (CH&SC) Section 40703 in adopting any regulation. Staff has completed the 

following analysis and believes that such an assessment will assist the public and the 

Governing Board in understanding the costs associated with this rulemaking effort. 

II. DISCUSSION

A. Cost Effectiveness

The cost effectiveness of a control option is calculated as the added annual cost (in 

$/year) of the control technology or technique, divided by the emission reduction 

achieved (in tons/year). The cost can include capital equipment costs, engineering 

design costs, additional labor and maintenance costs. The cost effectiveness also 

accounts for any monetary savings realized by the implementation of the pollution 

control techniques.

Rule 4308 would prohibit the sale of commercial water heaters that do not have lowNOx technology in the SJVAB. Most commercial water heater manufacturers offer for 

sale units that meet or exceed the requirements of Rule 4308. The cost effectiveness 

for Rule 4308 was calculated using the incremental price difference between a low-NOx 

compliant unit and non-compliant atmospheric unit. 

B. Cost Effectiveness Analysis Procedure

Following is the procedure used by District staff in conducting the cost effectiveness 

analysis of a rule: 

(1) Identify typical equipment settings affected by the rule; 

(2) Identify the control technologies or control option that can achieve the 

proposed emission limits;

(3) Estimate the average annualized cost of each control option;

(4) Calculate the average emissions reduction of each control option and

(5) Calculate the average cost effectiveness of a given control option of a given 

equipment setting.

As previously mentioned, cost effectiveness of a control technology is calculated by 

dividing the annualized cost of a control technique with the annual emission reduction 

achieved by the control technique. The cost effectiveness is expressed in dollars per 

ton of pollutants reduced per year ($/ton).
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 3 Final Draft Staff Report for

Revised Proposed Rule 4308

C. Sources of Cost Data

The cost estimate data is based on similar cost data from other air districts cost 

effectiveness analyses including SCAQMD, Ventura County APCD and Santa Barbara 

APCD to derive cost data from manufacturers and vendors. District staff has solicited 

for written and verbal cost data from stakeholders. District staff has also incorporated 

verbal comments provided by stakeholders into the cost effectiveness analysis. The 

District encourages manufacturers, vendors and other stakeholders to provide cost data 

pertinent to Rule 4308.

D. Assumptions Used in Calculating Cost Effectiveness

Following are assumptions used by District staff in conducting the cost effectiveness 

analysis for Rule 4308:

1. The total annual compliance cost will include annual operation and maintenance 

costs as well as annualized capital costs.

2. The total annualized compliance cost for all compliance scenarios include all the 

appropriate annualized capital costs as well as any additional annual operation and 

maintenance costs.

3. The life of an affected unit is 10 years.

III. REFERENCES

1. Santa Barbara County APCD Staff Report for Rule 360, dated October 2002.

2. SCAQMD Staff Report for Rule 1146.2, dated December 1997.

3. Ventura County APCD Staff Report for Rule 74.11.1, dated August 1999
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 4 Final Draft Staff Report for

Revised Proposed Rule 4308

ATTACHMENT 1

COST EFFECTIVENESS CALCULATIONS

In calculating the cost effectiveness for proposed Rule 4308, District staff assumed that 

the compliance cost consists of the differential purchase price of new compliant lowNOx commercial water heaters compared to a non-compliant unit. Low-NOx technology 

for commercial water heaters in the size range 0.075 MMBtu/hr up to but not including 

2.0 MMBtu/hr is available from several manufacturers as provided in the SCAQMD list 

of certified models for Rule 1146.2. Based on conversations with stakeholders, and an 

analysis of other air district staff reports District staff found a range of compliance costs 

for commercial water heaters based on size and manufacturer. Table C - 1.0 provides a 

list of the Districts estimated range of costs for compliant units of a specific size based 

on the SCAQMD 1997 survey of capital cost estimates.

Table C - 1.0: Range of Capital Cost of Units.

Units Size

(MMBtu/hr)

Capital Cost of Compliant 

Low-NOx

Unit ($)

Differential Capital Cost of 

Low-NOx Compared to 

Non-Compliant Units ($)

0.4 $6,000 - $10,000 $0 - $4,000

0.65 $7,500 - $12,000 $0 - $4,000 

1.0 $9,500 - $15,000 $1,500 - $5,000

2.0 $4,500 - $20,000 $2,000 - $10,000

The SCAQMD averaged the capital costs of new compliant low-NOx units and the 

estimated base capital cost of a non-compliant atmospheric units that are in the size 

range between 0.075 MMBtu/hr and 2.0 MMBtu/hr. This data was used to derive the 

differential capital cost for compliance with Rule 1146.2. These costs are provided in 

Table C – 2.0. 

Table C - 2.0: Average Capital Cost of Compliant Unit vs. Non-Compliant Unit.

Units Size

(MMBtu/hr)

Capital Base Cost of

Compliant Low-NOx Unit ($)

Differential Capital Cost 

of Unit ($)

0.15 Less than $6,000 $10

0.4 $6,000 $2,000

1.0 $9,500 $2,850

1.9 $16,300 $4,900
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 5 Final Draft Staff Report for

Revised Proposed Rule 4308

The SCAQMD conducted an implementation study in 2003 and reported (Phase III 

Implementation Report) that the average capital cost for new non-compliant units 

between 0.4 MMBtu/hr and 1 MMBtu/hr is $9,200 and for new low-NOx compliant units 

is $9,800. The average differential capital cost for these units is approximately $630. 

For a more conservative cost effectiveness value and compliance cost District staff 

utilized the compliance cost estimated in the SCAQMD Staff Report for Rule 1146.2 

(1997), which are provided in Table C - 2.0. Table C - 3.0 provides the cost 

effectiveness for units subject to Rule 4308 based on South Coasts projected costs of 

new compliant low-NOx replacements which are listed in table C - 2.0 and the Districts 

estimated emissions reductions.

Table C - 3.0: Compliant Low-NOx Unit Cost Effectiveness.

Unit (X) Size Range (MMBtu/hr) Estimated Cost Effectiveness 

($/ton)

X < 0.3 $250/ton

0.3 < X < 0.4 $5,600/ton

0.4 < X < 1.0 $-1,1087/ton (cost savings)

1.0 < X < 2.0 $-2,775/ton (cost savings)

Overall Cost Effectiveness for Rule 4308

Using the cost-effectiveness values for each different unit category District staff 

calculated overall average cost effectiveness of Rule 4308 and found that Rule 4308 will 

lead to a cost savings of $1,900 per ton of NOx reduced each year (Please see table C 

- 4.0). This cost savings is primarily due to the fuel efficiency in the compliant low-NOx 

burner units. The cost effectiveness values are based on a 10-year life span of each 

unit size range, and financed at 10 years with a 10% interest rate. Table C - 4.0 

summarizes the calculations used to determine the overall rule cost effectiveness.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 6 Final Draft Staff Report for Revised Proposed Rule 4308

Table C – 4.0: Overall Cost Effectiveness of Rule 4308.

Unit (X) Size Range 

(MMBtu/hr)

Number of 

Complying Units

Annualized 

Capital Cost Per 

Unit ($/yr)

Annual 

Maintenance 

Costs per 

Unit ($/yr)

Total Annual 

Compliance 

Costs per Unit 

($/yr)

Total Annual 

Compliance Cost 

for Rule 4308 ($/yr)

X < 0.3 8,261 $2 $0 $2 $16,522

0.3 < X < 0.4 2,201 $320 -$40

(Cost Savings) $280 $616,280

0.4 < X < 2.0 4,829 $620 -$ 1,025

(Cost Savings)

-$405

(Cost Savings) -$1,955,745

Totals 15,299 -$1,322,943

Estimated Total Annual Reductions (tons/yr) 702 tpy

Total Rule Cost Effectiveness ($/ton) -$1,900

Note 1: Total Annual Compliance Costs = Number of Units x Total Annual Cost per Unit

Note 2: Total Rule Cost Effectiveness = Total Annual Compliance Cost / Total Annual Reductions

Note 3: Calculations for the data indicated in Table C – 4.0 is shown on Pages C-7 through C – 10.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule4308 October 20, 2005

C - 7 Final Draft Staff Report for

Revised Proposed Rule 4308

Cost Effectiveness Calculations for Various Units.

The following calculations provide a overall cost effectiveness value (Cost in $/NOx 

Reductions in tons) for units subject to Rule 4308 based on the differential capital cost 

and annual maintenance cost given the size and emissions associated with that specific 

unit. 

New Replacement Unit Analysis

A. Unit Size: 0.15 MMBtu/hr

Boiler Specification: Value

Boiler Rating 0.15 MMBtu/hr 

Capacity Factor 22% 

Uncontrolled NOx 0.137 lb/MMBtu

Controlled NOx 0.0764 lb/MMBtu

∆Cost for a Low-NOx Unit $10

Formula 1:

Annualized Capital Cost are calculated using the following formula

i(1+i)n

A = P ________ where;

(1+i)n - 1

A = Equivalent Annual Control Equipment Capital Cost

P = Present value of the control equipment, including installation cost

i = interest rate (use 10%, or demonstrate why alternate is more

representative of the specific operation).

n = equipment life (assume 10 years or demonstrate why alternate is more

representative of the specific operation)

Applying formula 1 to the ∆Cost = $10 produces an annualized capital cost of $2 per 

year. 

The emission reduction (∆ NOx) for this unit is calculated using the following formula.

( )

yr

tons NOx = 0 .008 Δ

2,000 lb

ton

× 0.22 ×

MMBtu

lbs

× 0.137 - 0.0764

yr

hrs

× 8,760 hr

MMBtu NOx = 0.15 Δ
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 8 Final Draft Staff Report for

Revised Proposed Rule 4308

The cost effectiveness for this unit is calculated as follows.

Cost Effectiveness = $2/yr 

0.008 tons/yr

Cost Effectiveness = $250 

 0.008 ton

Similar calculations were performed for three larger unit sizes.

B. Unit Size: 0.4 MMBtu/hr

Boiler Specification: Value

Boiler Rating 0.4 MMBtu/hr 

Capacity Factor 21.5% 

Uncontrolled NOx 0.17 lb/MMBtu

Controlled NOx 0.0328 lb/MMBtu

Base Unit Cost $6,000

Low-NOx Unit Cost $8,000

∆Cost for a Low-NOx Unit $2,000

Fuel Cost $0.5/Therm

Efficiency Gain (low-NOx) 10%

Annual Tune-up Cost $300/yr

Cost for Electric Fan (low-NOx) $40/yr

Base Cost

Capital = $6,000

Fuel Costs = $3,800/yr

× 0.22 0.1MMBtu

$0.5

×

yr

8,760 hr

×

hr

0. 4 MMBtu Fuel Costs =

Low-NOx Cost

Capital = $8,000

∆ Capital Cost = $8,000 - $6,000 = $2,000

Applying formula 1 to the ∆Cost = $2,000 produces an annualized capital cost of $320 

per year. 

Fuel Savings = ($3,800 × 0.10) = -$380/yr

Electric Fan = +$40/yr

Annual Tune-up = +$300/yr

Net Annual Cost = -$40/yr
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 9 Final Draft Staff Report for

Revised Proposed Rule 4308

( )

yr

tons NOx = 0.05 Δ

2,000

1

× 0.22 ×

MMBtu

0.17 _ .0328 * lb

× 8,760 ×

hr

0.4MMBtu NOx = Δ

0

Cost Effectiveness = $320/yr - $40/yr

 0.05tons/yr

Cost Effectiveness = $5,600

 ton

C. Unit Size: 1.0 MMBtu/hr

Boiler Specification: Value

Boiler Rating 1.0 MMBtu/hr

Capacity Factor 21.5%

Uncontrolled NOx 0.17 lb/MMBtu

Controlled NOx 0.0328 lb/MMBtu

Base Unit Cost $9,500

Low-NOx Unit Cost $12,350

∆Cost for a Low-NOx Unit $2,850

Fuel Cost $0.5/Therm

Efficiency Gain (low-NOx) 10%

Annual Tune-up Cost $300/yr

Cost for Electric Fan (low-NOx) $40/yr

Base Cost

Capital = $9,500

× 0.22 = $9,400 0.1MMBtu

$0.5

×

yr

8,760 hr

×

hr

1MMBtu Fuel Costs =

Low-NOx Cost

Capital = $12,350

∆ Capital = $12,350 - $9,500 = $2,850

Applying formula 1 to the ∆Cost = $2,850 produces an annualized capital cost of $456 

per year. 

Fuel Savings = ($9,400 × 0.10) = -$940/yr

Electric Fan = $40/yr

Annual Tune-up = +$300/yr

Net Cost = -$600/yr
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 10 Final Draft Staff Report for

Revised Proposed Rule 4308

( )

yr

tons NOx = 0 .13 Δ

2,000

1

× 0.22 ×

MMBtu

0.17 .0328 * lb

× 8,760 ×

hr

1MMBtu NOx = Δ

- 0

( )

(Cost Savings) ton

- $1107 Cost Effectiveness =

0.13 tons/yr

$456/yr - $600 /yr Cost Effectiveness =

D. Unit Size: 1.9 MMBtu/hr

Boiler Specification: Value

Boiler Rating 1.9 MMBtu/hr 

Capacity Factor 21.5%

Uncontrolled NOx 0.17 lb/MMBtu

Controlled NOx 0.0328 lb/MMBtu

Base Unit Cost $16,300

Low-NOx Unit Cost $21,200

∆Cost for a Low-NOx Unit $4,900

Fuel Cost $0.5/Therm

Efficiency Gain (low-NOx) 5%

Annual Tune-up Cost $300/yr

Cost for Electric Fan (low-NOx) $40/yr

Base Cost

Capital = $16,300

Fuel Costs = $17,900

× 0.22 0.1MMBtu

0.5

×

yr

8,760 hr

×

hr

1.9 MMBtu Fuel Costs =

low-NOx Cost

Capital = $21,200

∆ Capital = $21,200 - $16,300 = $4,900

Applying formula 1 to the ∆Cost = $4,900 produces an annualized capital cost of $784 

per year. 

Fuel Savings = ($17,900 × 0.10) = -$1,790/yr

Electric Fan = +$40/yr
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 11 Final Draft Staff Report for

Revised Proposed Rule 4308

Annual Tune-up = +$300/yr

Net Cost = -$1,450/yr

( )

yr

tons = 0.24 Δ Δ

NO

2,000

1

× 0.22 ×

MMBtu

0.17 - 0.0328 * lb

× 8,760 ×

hr

1.9 MMBtu NOx = Δ

Cost Effectiveness = $784/yr - $1450/yr

 0.24 tons/yr

Cost Effectiveness = $2,775

 ton
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix C: Cost Effectiveness Analysis for Rule 4308 October 20, 2005

C - 12 Final Draft Staff Report for

Revised Proposed Rule 4308

.

This page intentionally blank
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix D: Socioeconomic Analysis for Rule 4308 October 20, 2005

D - 1 Final Draft Staff Report for 

Revised Proposed Rule 4308

APPENDIX D

Socioeconomic Analysis for

Rule 4308 (Boilers, Steam Generators, and Process Heaters -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

October 20, 2005
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix D: Socioeconomic Analysis for Rule 4308 October 20, 2005

D - 2 Final Draft Staff Report for 

Revised Proposed Rule 4308

SOCIOECONOMIC ANALYSIS FOR

RULE 4308 (BOILERS, STEAM GENERATORS, AND PROCESS HEATERS -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

I. SUMMARY

Draft Rule 4308 implements the District’s control measure commitment in the 2003 

PM10 Plan. Rule 4308 is a new rule developed to control NOx emissions from new or 

replacement commercial water heaters. Draft Rule 4308 implements the District’s 

BACM requirements for this source category. Full implementation of Rule 4308 will 

result in a NOx reduction of 730 tpy.

II. INTRODUCTION

Section 40728.5 of the State Health and Safety Code requires the Air Pollution Control 

District (District) to perform a socioeconomic impact assessment for any new or 

amended rules and regulations that will significantly affect air quality or emission 

limitations. Rule 4308 prohibits the sale of old atmospheric units that exceed low-NOx 

emissions as defined in the rule. Full implementation of Rule 4308 will result in a NOx 

reduction of 730 tpy based on a 10% per year attrition rate. The full implementation of 

Rule 4308 will begin in January of 2007. This report contains the District’s assessment 

of the socioeconomic impacts of proposed District Rule 4308 (Commercial Water 

Heaters).

III. NECESSITY OF RULE ADOPTION

The SJVAB exceeds both federal and state ambient air quality standards for PM10 and 

is classified as serious nonattainment for the 24-hour and annual NAAQS for PM10. 

The NOx emissions for commercial water heaters (3.3 tpd) exceed the SJVAB deminimus threshold of 1.3 tpd; therefore the District is required by the CAA to adopt 

BACM that includes BACT. The BACM affects new commercial, industrial, or 

institutional water heaters with a rated heat input capacity greater than and including 

0.075 MMBtu/hr and less than but not including 2.0 MMBtu/hr. The Districts 2003 PM10 

Plan considers the reduction of NOx emissions as an effective strategy for reducing the 

formation of the ammonium nitrate component of PM10. 

IV. IMPACT ASSESMENT

As specified in the Health and Safety Code, “socioeconomic impact” means the 

following:
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix D: Socioeconomic Analysis for Rule 4308 October 20, 2005

D - 3 Final Draft Staff Report for 

Revised Proposed Rule 4308

1. The type of industries or business, including small business, affected by the rule 

or regulation.

2. The range of probable costs, including costs to industry or business, including 

small business, of the rule or regulation.

3. The impact of the rule or regulation on employment and the economy of the 

region affected by the adoption of the rule or regulation.

The Facilities Affected by Rule 4308 (Commercial Water Heaters)

A. Industry Profile

Draft Rule 4308 would prohibit the sale of non low-NOx units and requires that boiler 

manufacturers sell only low-NOx units in the SJVAB. The requirements of Rule 4308 

will not directly impact boiler manufacturers since most manufacturers currently produce 

a low-NOx unit. Rule 4103 will indirectly impact a variety of public and private 

businesses, organizations and institutions in the SJVAB that have commercial water 

heaters. A 2001 survey conducted by PES reported that there are a number of 

industrial, commercial and institutional facilities in the SJVAB with units that will 

potentially be subject to Rule 4308 (See table D - 1.0). The number of boilers and boiler 

size per facility is variable among stakeholders. The largest number of units identified 

by PES per facility was 15. These units are typically used as centralized devices that 

provide hot water to many users in a building, or provide steam for heating and steam 

for pressing machines at dry cleaners and other cleaning services.

Table D 1.0: Affected Industries

SIC Code Industry Category

20 Miscellaneous Manufacturers

22 - 29 Manufacturers

46 Pipelines

54 General Merchandise Stores

5812 Eating Places

70 Hotels

721 Housing and Camps

7542 Cleaning Services

806 Hospitals

82 Educational Services

8661 Religious Organizations

91 Executive, Legislative, &General Government
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix D: Socioeconomic Analysis for Rule 4308 October 20, 2005

D - 4 Final Draft Staff Report for 

Revised Proposed Rule 4308

The uncontrolled NOx emissions rate for standard units with a rating of 0.075 MMBtu/hr 

and less than 0.3 MMBtu/hr is 0.137lb/MMBtu, and 0.170lb/MMBtu for those units that 

are greater than or equal to 0.3 MMBtu/hr in size but less than 2.0 MMBtu/hr. The 

controlled NOx emissions rates for compliant low-NOx units are 0.074 lb/MMBtu for 

units greater than and including 0.075 MMBtu/hr but less than and including 0.4 

MMBtu/hr. For compliant low-NOx units larger than 0.4 MMBtu/hr and smaller than 2.0 

MMBtu/hr the controlled low-NOx emission rate is 0.032 lb/MMBtu. Using the estimated 

number of units in this source category with their corresponding heat input rating District 

staff has estimated that the NOx emissions baseline for this source category is 3.3 tpd. 

Based on boiler manufacturer claims that these units have an average life span of 10 

years and consideration of the proposed NOx limit for new units the District estimates 

that the emission reductions from Draft Rule 4308 is 2.0 tpd.

B. Compliance Cost Estimates

Draft Rule 4308 specifies the NOx emission limit for commercial water and references a 

list of commercial water heaters certified by the SCAQMD that meet the proposed limit. 

The implementation of these controls range in capital cost and maintenance costs. 

However, it is important to note that certified compliant units are significantly more fuelefficient than standard non-compliant units. On average for units that are between 

0.4 MMBtu/hr and 2.0 Btu/hr there is a significant annual cost savings over the 10-year 

life span of the unit due to increased fuel efficiency. For smaller units there is an 

insignificant increase in annual costs as provided in Table D - 2.0. 

Table D -2.0: Total Average Annual Compliance Costs.

Unit (X) Size Range 

(MMBtu/hr)

Annualized 

Capital Cost Per 

Unit ($/yr)

Annual 

Maintenance 

Costs per 

Unit ($/yr)

Total Annual 

Compliance 

Costs per 

Unit ($/yr)

X < 0.3 $2 $0 $2

0.3 < X < 0.4 $320 -$40

(Cost Savings) $280

0.4 < X < 2.0 $620 -$ 1,025

(Cost Savings)

-$405

(Cost Savings)
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix D: Socioeconomic Analysis for Rule 4308 October 20, 2005

D - 5 Final Draft Staff Report for 

Revised Proposed Rule 4308

V. ECONOMIC AND EMPLOYMENT IMPACTS

The District is not requiring operators to change out their existing units by a specific 

deadline. Rule 4308 is an “attrition based” rule, which prohibits the sale of commercial 

water heaters that do not meet specific emission limits. While compliant low-NOx units 

have a slightly higher capital cost, their increased fuel efficiency leads to an annual cost 

savings and insignificant annual costs in some cases. Therefore, it is understood that 

no economic or employment impacts will be associated with the implementation of Rule 

4308.

VI. BENEFITS AND EMISSION REDUCTION POTENTIAL

The annual baseline NOx emissions from commercial water heaters in the SJVAB are 

estimated to be about 3.3 tpy. Implementation of Rule 4408 would result in an annual 

NOx emissions reduction of about 2.0 tpd, or approximately a 61 percent reduction for 

this source category. 
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix D: Socioeconomic Analysis for Rule 4308 October 20, 2005

D - 6 Final Draft Staff Report for 

Revised Proposed Rule 4308

This page intentionally blank.
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix E: Rule Consistency Analysis for Rule 4308 October 20, 2005

E -1 Final Draft Staff Report for 

Revised Proposed Rule 4308

APPENDIX E

Rule Consistency Analysis for

Rule 4308 (Boilers, Steam Generators, and Process Heaters -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

October 20, 2005
SAN JOAQUIN UNIFIED VALLEY AIR POLLUTION CONTROL DISTRICT

Appendix E: Rule Consistency Analysis for Rule 4308 October 20, 2005

E -2 Final Draft Staff Report for 

Revised Proposed Rule 4308

RULE CONSISTENCY ANALYSIS FOR

RULE 4308 (BOILERS, STEAM GENERATORS, AND PROCESS HEATERS -

0.075 MMBtu/hr to 2.0 MMBtu/hr)

I. REQUIREMENTS OF ANALYSIS

Pursuant to Section 40727.2 of the California Health and Safety Code, prior to adopting, 

amending, or repealing a rule or regulation, the District is required to perform a written 

analysis that identifies and compares the air pollution control elements of Draft Rule 

4308 (Boilers, Steam Generators and Process Heaters – 0.075 MMBtu/hr to 

2.0 MMBtu/hr) with the corresponding elements of existing or proposed District and 

United States Environmental Protection Agency (EPA) rules, regulations, and guidelines 

that apply to the same source category.

II. RESULTS OF ANALYSIS

A. District Rules

There is no other District prohibitory rule or regulation tailored specifically for 

commercial water heaters as a source of NOx or other PM10 precursors.

B. US EPA Rules and Guidelines

There is no specific federal guideline applying to commercial water heaters as a source 

of PM10 precursors, in terms of the following: New Source Performance Standards 

(NSPS), Control Technique Guidelines (CTG), Maximum Achievable Control 

Technology (MACT) and National Emission Standards for Hazardous Pollutants 

(NESHAP).