## ATTACHMENT J

Letter dated January 7, 2008, submitted by Chemstone in support of its BART determination (response to VRO 30-day letter for revised SO2 BART proposal)

# OIV O-N MINERALS CHEMSTONE OPERATIONS 1696 ORANDA ROAD PO BOX 71 STRASBURG, VA 22657 0." L. TEL 540-465-5161 FAX 540-465-5150 www.oglebaynorton.com

January 7, 2008 Via E-MaillOriginal via Overnight Deliverv Ms. Sharon G. Foley, P.E. Air Permit Manager Commonwealth of Virginia Department of Environmental Quality Valley Regional Office 4411 Early Road P.O. Box 3000 Harrisonburg, VA 22801 RE: Response to Department Comments on S02 BART Determination Addendum (November 2007) for ON-Minerals (Chemstone) Strasburg, VA Dear Ms. Foley: In response to your comments and request of December 14, 2007 for further information, O-N Minerals (Chemstone) is providing responses and additional informationrelative to the Best Available Retrofit Technology (BART) S02 determination for our the Strasburg facility submitted in November 2007. As you will see, this additional analysis confirms our original conclusions. We hope this letter provides the Virginia Department of Environmental Quality (DEQ) with the additional information needed to confirm our proposed BART determination for S02. We are glad to engage in further discussions as necessary.



### VA DEQ Comment #1: Section 4.2 (Step 1: Identification of Available Retrofit S02 Control Technologies): Please also evaluate the technical and economic feasibility ofcontrolling S02 using a hydrate injection system similar to the oneproposed by Chemstone inAugust 2006 for control ofhydrochloric acid (HCI)from the rotary kiln. Your evaluation should include expected S02 reductions from such a system as well as a cost analysis. O-N Minerals Chemstone Response: Sorbent (hydrate) injection is an available and proven technology for S02 control on boilers. Chemstone, however, has been unable to identify an application of this control technology onMs. Sharon G. Foley, P.E. January 7, 2008 existing lime kiln operations for S02 reduction. Consequently, there is no data available with which to establish an expected S02 control efficiency and corresponding BART emission limit. And, there is no reasonable method to define the cost per ton of S02 removed. Please note that the previous trials ofthis technology at the Winchester facility do not help us here. That trial was done with the hope of making reductions in HCI at our Winchester facility, but those plans were abandoned for a number of significant technical and economic reasons. We did not test for S02 emissions during this trial, so there is no data that will help us in this context from those trials. We should note that hydrate injection has been shown to be inherently less efficient in removing S02 versus HCI. Also, because the temperatures in a lime kiln exhaust stream are much greater than a boiler, the adsorption processes are less efficient. Page 2 of6



### VA DEQ Comment #2: Section 4.2.4.1 (Wet Scrubber Impact Analysis) (Comments also addressAppendixA

- CostAnalysis, incorporatedby reference into report): Please reevaluate cost effectiveness after adjustingfor thefollowing discrepancies (based on guidance in EPA's Cost Control Manual):



## . Please provide documentation for quoted Purchased Equipment Costs (PEC);



## . The contingency fee should be threepercent ofPEC, not 10%ofTotalDirect andIndirect Costs;



## . Capital Recovery should be based on a 15-year unit life and seven percent interest;



## . Please perform two cost effectiveness (cost/ton) calculations assuming 90% and 95% removal. O-N Minerals Chemstone Response: Due to the expeditedmanner in which this analysis was completed, the ability to properly engineer and cost the various options being considered are simply not available. While we understand that DEQ is citing available guidance from EPA on related subject matter in making these comments, each BART determination needs to be completed on a case-by-case basis. To that end, we reiterate that our prior conclusions that both wet and dry scrubbing alternatives are not economically feasible. Please refer to our original analysis (performed consistent with available guidance and requirements) in addition to the materials accompanying this letter. Chemstone provides additional assessment of economic impacts using various assumptions cited by the DEQ for the two scrubbing technologies. Ultimately, changing these variables does not change the conclusion that the costs are extremely high and application of such technologies would only provide for a miniscule improvement in visibility. Purchased Equipment Costs (PEC). Documentationfor quoted PurchasedEquipment Costs (PEC) is included as part of the attachment. In orderto accountfor size differencesbetween the modelplant used and the rotary kiln at Chemstonethe sixth tenth's power rule was used based on the airflows of the two units to provide a more accurateestimate ofPEC for the subjectkiln. The provided costs were for a new kiln line and not a retrofit applicationwhich wouldbe expected to slightly underestimatecosts for applicationofthis technologyon the Strasburgrotary kiln.Ms. Sharon G. Foley, P.E. January 7, 2008 Page 3 of6

Contingency Percentages. The DEQ has suggestedusing a contingencyfee of 3 percent ofthe purchasedequipment costs per the U.S. EPA's Control CostManual (CCM). However, the Coal Utility Environmental Cost (CUECost) Model Version 1.0 availablefrom the U.S. EPA's Clean Air Technology Center, which specificallyprovides cost estimates for wet scrubbing (albeit for coal-firedpower plants), details that the contingency fee could be as high as 20 percent ofthe total installation cost. 1 We would also like to illustratethat the CCM calculationsreferencedby the DEQ are for venturi-type scrubbers and do not reflectretrofit scenariosfor a flue gas desulfurization system that includes a spray tower absorber. While Chemstone generally agrees with the CUECostcontingencyfee, especially since the rotary kiln wouldbe retrofitted with the control technology, we need to realisticallyuse more conservative cost estimates than 3 percent. Using a contingencyfee of 10percentof the Total Direct and Indirect Costs accomplishesthis goal, but is still only half ofthe contingency fee that could be used using U. S. EPA guidance. Therefore, Chemstonebelieves that a 10percent (or more) contingency fee is more appropriatefor retrofit applicationsof a wet scrubberthan the reference cited by the DEQ. Despite the CCM's use of 10percent ofthe PEC each for engineering, constructionfees, and construction and field expense, Chemstoneutilized 8, 3, and 10 percent respectivelyfor calculatingthe cost associatedwith the wet scrubbertechnology. Capital Recovery. The values used for capital recovery periods (10 years at 9 percent interest) presented in our 2007 submittal are reasonableand have been acceptedin other similar analyses reviewed by EPA when determining economic feasibilityofthese sametechnologies on lime kilns. Nonetheless, we have includedcosts based on variousrecoveryperiods as presentedin the attachments and discussionbelow. Expected Control Efficiencies. We are not aware of any BART or BACT limitationthat incorporates a 95% S02 removal using a wet or dry scrubber. Considering this level ofcontrol has not been demonstratedon a lime kiln to date for these technologies, a cost analysis at this control level is not appropriatefor BART. Nonetheless,we have evaluated that variable in our presented materials so we can compare themto the originalinformation. Cost Evaluation Scenarios and Sensitivities. To address the variables that DEQ has provided comment on, we developed a series ofcost estimation scenariosto assess the sensitivity ofcost estimates. Specifically,we looked at economic impactsbased on varying interestrates, capital recovery periods, and control efficiencies. As shownin Table 1 ofthe attachment, the costs remain very high and reflect a range of4,090 to 6,423 $/ton removed. Similarly,costs per deciview improvementwere in excess of $22,400,000. At this cost level, the application of wet scrubbing is economically infeasible. For this reason and the other environmental and energy disadvantages associated with this technology, this technology does not constitute BART.

1 Coal Utility Environmental Cost (CUECost) Workbook User's Manual, Version 1.0.Ms. Sharon G. Foley, P.E. January 7, 2008 Page 4 of 6


### VA DEQ Comment #3: Section 4.2.4.2 (InherentDry Scrubbing ImpactAnalysis): Please explain how the "70-99+" percent removal was calculated. O-N Minerals Chemstone Response:
The efficiencies for inherent dry scrubbing, as referenced in the revised BART Detennination, represent the approximate range of system removal achieved from the Strasburg Plant's rotary lime kiln based on a rough mass balance estimate. Specifically, the 70 to 99+% removal efficiencies should accurately reflect emissions data collected from the 2000 and 2007 stack test data from the rotary kiln at Strasburg.



### VA DEQ Comment #4: Section 4.2.4.3 (Spray Dryer Absorber Impact Analysis)(Comments also address Appendix A



### - Cost Analysis, incorporated by reference into report):Please reevaluate cost effectiveness after adjusting for the discrepancies noted abovefor the wet scrubber impact analysis (except that the cost effectiveness cost/ton) calculation should be based on 90% removal). Additionally, please clarify whether the reagent to be used would be lime or trona. O-N Minerals Chemstone Response: As with our response to V A DEQ Comment#2 (which also contains some informationrelevant to this response), documentationfor quoted Purchased EquipmentCosts (PEC) has been included as part ofthe attachment. The values appliedin our submittedanalysis are consistentwith EPA guidance and reflect the case-specific naturewith which a BART analysis is required to comply. In order to account for size differencesbetween the modelplant used and the rotary kiln at Chemstone the "sixth tenth's power" rule was usedbased on the airflows of the two units to provide a more accurate estimate ofPEC for the subjectkiln. The provided costs were for a new kiln line and not a retrofit applicationwhich would be expected to slightly underestimatecosts for applicationof this technology on the Strasburgrotary kiln. To address the variableson which DEQ has provided comment, we developeda series ofcost estimation scenarios to assess the sensitivityofcost estimates. Specifically,we looked economic impacts based on varying interestrates, capital recoveryperiods, and control efficiencies, as described in our response to Comment#2. Importantly,the expectedreagent used for this technology would be lime due to lime's local availabilityversus trona's natural availabilityin the western U.S. As shown in Table 2, the results remain very high andreflect a range of $5,218 to 7,283 per ton S02 removed. Similarly, costs per deciview improvementwere in excess of $27,190,300. At this cost level, the application of dry scrubbing is economically infeasible. For this reason and the other environmental and energy disadvantages this technology brings, this technology does not constitute BART.Ms. Sharon G. Foley, P.E. January 7, 2008 Page 5 of6



### VA DEQ Comment#S: Section 4.2.6 (Comparison to Datafrom OtherPreheaterRotary Lime Kilns): Please indicate the units (lbs/ton lime or lbs/tsf) for the emission factors listed. O-N Minerals Chemstone Response: The referenced S02 emission factors were derived from data located in the V.S EPA's RBLC database from the Clean Air Technology Center. Because not all emission factors in this database are appropriatelylabeled, Chemstone attemptedto replicate calculatingthe emission factors by utilizing the emission rates and potentialthroughputincludedin the RBLC data. With this in mind, Chemstonehas addressedthis comment, to the extentpossible, by including the appropriateunits in the revisedTable 4-7. This table is included as an attachmentto this response letter.



### VA DEQ Comment #6: Please evaluate thefeasibility of and expected emissions reductions from the use of lower-sulfur fuel(s) in the rotary kiln. O-N Minerals Chemstone Response: We alreadyuse relatively low sulfurcoals (and are currently limited to 1.5% sulfur in coal) in our rotary kiln. As a whole, these lower sulfurfuels are less available and more costly due to the demand in many industries/uses. In addition, the nature of the preheaterlime kiln process inherentlyremoves fuel sulfurunlike traditionalcombustionprocesses. And, it is also known that sulfur in raw material can significantlycontributeto S02 emissions from lime kilns. The contribution ofemissions from raw materials are unaffectedby changes in fuel sulfur. For these reasons and as discussed in the following,reductions in fuel sulfurin limekilns do not result in direct reductions of S02 from the process. This is a far differentresult than traditionalcombustion sources (e.g., boilers). Furthennore, data collectedfrom the subjectkiln also confirm that there is no direct correlationbetween fuel sulfur input and S02 emissions from the rotary kiln. An engineering study offuel sulfurlevels in our rotary kiln that was conducted in May 2000 showed no reduction in S02 emission levels with 1.5% sulfurcoals versus 1% sulfurcoals. This result demonstrated that the reduction of S02 emissions is associatedwithmore complex factors (e.g., potentially sulfur in raw materials) and were not significantlyaffectedby the fuel change. Notwithstandingthe fact that a fuel sulfurreduction strategyon the Strasburgrotary lime kiln would only result in a partial (at best) reduction of S02 emission from kiln system, Chemstonehas made a preliminary economic assessmentshould such a sulfur in fuel reduction strategy be applied. Based on the heat input needs ofthe kiln, the facility would experience increased annual operating costs of between $4,000,000 and more than $18,000,000to eliminate solid fuel use and use natural gas or fuel oil. Ifyou falsely presume that all 290 tons per year of S02 could be removed by applying such a strategy, the costs wouldbe in the order of $15,000 to $64,000per ton S02Ms. Sharon G. Foley, P.E. January 7, 2008 removed if it were implemented. Clearly, neither fuel change alternativeis economicallyfeasible and is not BART. Page 6 of6



### --------------- We hope that the information provided above will assist in the Department's review of this BART analysis. If you have any questions or comments, please do not hesitate to contact me at (540) 465-6822. Sincerely,

Karl D. Everett, P.E. Senior Environmental Health and Safety Manager O-N Minerals Chemstone Corporation ATTACHMENTS

cc: Mr. Mike Kiss, VDEQ Mr. Mike Remsberg, Trinity Mr. John Richards, Air Control Techniques