Attachment 3

Industry Position Paper:

API/NPRA/WSPA Process Heater Turndown Position 11-19-09Page 1 API/NPRA/WSPA Process Heater Turndown Position 11-19-09

API/NPRA/WSPA believe that some refinery process heaters that operate at high turndowns for extended periods cannot achieve the NOx emission limits that are included in the December 28, 2008 proposed NSPS Ja amendments. Thus, the proposed NOx limits do not represent Best Demonstrated Technology (BDT) for those pr ocess heaters and EPA should supplement the proposed standard by establishing a standard that applies to thes e process heaters.

Providing such a mass limit for turndown operati ons does not increase emissions, but only recognizes the characteristics of burner operation at turndown rates. Under a mass limit, NOx mass emissions during turndown are still well below the mass emitted at high rates at the

concentration of the emission standard and in most cases will be well below the mass emitted by unregulated process heaters (e.g., those <40 MMBTU/hr).

We would also point out that a shorter averaging time than the proposed 365 days would increase the number of process heaters that can not comply with the proposed emission limit, because process, production and maintenan ce related cutbacks of process heater duty can go on for weeks

or even a few months. For instan ce, if a process heater were ope rated at 10% of capacity for one month and 90% the rest of the year, the annua l average firing would be 83% and the average NOx concentration for the year would not be significantly impacted by the higher emissions concentration during the one month period. Yet, if the emission limit were a 30 day average, the process heater could be out of compliance at least 30 times.

Basis for Position

1. Process heaters that operate at tur ndown rates for extended periods were not fully considered in developing the propos ed process heater NOx emission limit.

Docket Document EPA-HQ-OAR- 2007-0011-0290 (Evaluation of N itrogen Oxides Emissions Data for Process Heaters, December 19, 2008) re ports EPA’s analysis of NOx emission data collected from industry and vendors that served as the basis for the proposed emission limits. This report summarizes data obtained from CEMS monitoring, stack tests (mostly from burner test cells) and vendors, but does not provide adequate detail to de termine how the Agency used it to develop the proposed limits. It is clear from the data tabl es and discussion however, that process heater turndown operation wa s not well represented in the da ta. The little data that is included for turndown operation (four test cell sets of data reported for the latest generation of

ultra low NOx burners on different fuels where emissions were de termined at 20-30% of normal firing as well as at normal levels) showed in three of the four cases that the NSPS Ja NOx concentration limit would not be met at or just below these firing levels, even under test cell conditions. In general, the data referenced in this document a nd otherwise available does not seem to include any process heater s that normally operate at high turndown. This is reasonable, since CEMS are not justified for process heat ers with small NOx emissions and performance testing is done at or near design rates.API/NPRA/WSPA Process Heater Turndown Position 11-19-09 Page 2

None-the-less, the Agency appears to have accept ed that the industry concern is valid, because there is an attempt to provide relief in th e December 22 proposal. Specifically, EPA proposes applying a 365-day averaging time to the NOx limit, in order to address periods of turndown. It is stated in the proposal preamble:

Turn downs, therefore, result in less effi cient combustion, which tends to increase

NOX concentrations in the heater exhaus t. Even though the concentration of NOX increases during turn downs, the mass of NOX emitted does not because there is less exhaust gas produced. Turn downs typically occur in hydrotreater or hydrogen units that have varying operationa l rates. Some process heaters may be in turn down for months (e.g., when a hydr otreater is using a new catalyst). As Industry Petitioners point out, one way to allow for the variations in emissions that are due to process fluctuations, tu rn downs, and variations in fuel gas composition is to extend the averaging tim e over which compliance is determined. Based on the above information, we ar e proposing changes to the NOX limit to address these issues. [73 FR 78526, Dec 22, 2008]

API/NPRA/WSPA agree that providing an annual av eraging time along with the Part 60 General Provisions SS&M exemption, handles the problem for most turndown situations, since short and even intermediate-length periods of turndown woul d not drastically affect an annual average. However, the annual average approach still does not address the emissions from those process heaters that operate at turndown ra tes for all or a significant part of a year, where they are turned down to the point that their NOx emissions con centration corrected to 0% oxygen is above the proposed limits. We believe there are enough of thes e situations in the indus try that further relief is required.

Given that these low emitters are not typically equipped with CEMS, direct demonstrations of this problem are not available. Thus, we rely on two elements to support our argument. First,

that NOx emission concentrations increase as process heaters are turn ed down, though the point at which the design emission concen tration is exceeded varies with the heater. Second, there are a reasonable number of process heaters that operate at high turndowns for long periods of time. We also point out in Item 4 that ther e is precedent for the relief we seek.

2. Most process heaters cannot meet the proposed standards at some turndown

rate.

NOx emission rates, in ppmv or lb/MMBTU, from process heaters increa se at low firing rates when emissions are calculated on a dry, 0% excess ai r basis. Therefore, ma ny Part 60 Subpart Ja process heaters will be unable to maintain th eir design NOx emission rate below the applicable 40 or 60 ppmv (dry, 0% O 2 ) emission limitation under turndown conditions, though the point at

which these emission rates would be exceeded is process heater specif ic. This is amply

demonstrated in the data available to the EPA.API/NPRA/WSPA Process Heater Turndown Position 11-19-09 Page 3

As EPA says in the NSPS Ja Amendments Final BID (EPA-HQ- OAR-2007-0011-0228), page 31, “CEMS are not cost-effective means of ensuring compliance for the smaller process heaters.” Thus, it is not surprising that CEM data for pr ocess heaters that normally operate under turndown conditions is lacking. Installing CEMs on such process heaters does not make economic sense and, because of the low emissions, usually doesn’t make environmental sense. There is however, quite a bit of CEMS data that has been provided to EPA for process heaters that normally operate at higher firing rates. This data shows clearly that when process heaters fire at low rates, the

stack excess air increases and the NOx concentrati ons, corrected to 0% excess air, increase.

This issue was explained by Dr. Waibel of J ohn Zinc in his paper (Docket Item EPA-HQ-OAR2007-0011-0262.2) as follows.

Modern ultra low NOx burners reduce NOx by staging fuel and entraining furnace gases into the fuel gas jets as the fuel is injected into the flame zone. The entrained furnace gases help moderate p eak temperatures within the flame. Typically the more furnace gas entrained into the flame zone the lower the NOx emissions. At the same time, the higher the furnace operating temperature the higher the level of entrainm ent must be to get the desired emission reduction.

For any given fuel composition and furnace gas temperature there is a limit to how much furnace gas can be entrained into the flame zone before the flame is cooled to the point where the combustion reaction is quenched resulting in flame instability and ultimately loss of flame. The maximum amount of furnace gas that can be mixed with the fuel depends on the temperature of the furnace gas and the oxygen content of the furnace gas. High leve ls of entrainment of cool, low oxygen furnace gases will result in flame quenching.

The heater operating temperature is highe st at maximum firi ng rate and burners must be designed with high levels of fu el staging and furnace gas entrainment to reduce NOx for this high temperatur e operation. Unfortunately, under turndown conditions when the furnace operating temper ature drops the level of staging and entrainment that was necessary and acceptable under high temperature conditions will quench the flame unless the oxygen le vel in the furnace gases is elevated. Although the elevated oxygen level is good for flame stability it results in an elevated NOx concentration in the stack gase s. However, the firing rate is low, so even though the pounds of NOx per million Bt u is generally higher, the pounds of NOx per hour produced by the heater under turndown is genera lly less than the emissions under high fire operation.

Dr. Waibel’s paper includes two examples of process heaters equipped with ultra-low NOx burners. In both cases, the propos ed emission limits could not be met if these heaters had to operate under turned down conditions for extended periods.API/NPRA/WSPA Process Heater Turndown Position 11-19-09 Page 4

Furthermore, Dr. Waibel states that “NOx guara ntees provided by burner designers are generated by evaluating the worst case conditions specified for the maximum and normal firing rates for the heater. A maximum predicted emission level is de termined and then a safety factor is applied to accommodate uncertainty and help insure that the guarantee level will be met. Guarantees are not made for operation below 50% of design si nce the operating conditions become uncertain

and excess air levels must be set for safe operation rather than for NOx control.”

3. Some process heaters operate at high tu rndown conditions for extended periods. For the reasons stated in item 2, it would be expected that some of these process heaters will not be able to meet the proposed emission limits.

There are some situations where process heat ers’ normal operations i nvolve extended turndown operation. A common example is hydrofiner heaters, where mini mal heater duty is required when the catalyst is fresh, which can result in years of operation at high turn down rates. The population of such process heaters is rising as the result of the recent rash of low sulfur diesel projects installed in response to the EPA Ultr a Low Sulfur Diesel requirements. Extended turndown operation can also occur as a result of economic conditions. On September 9, 2009, in a letter to Mr. K. C. Hustvedt, we provided an analysis of the process heater operating data contained in the refinery industr y consent decrees. A total of 800 process heaters with design firing over 40 MMBTU/hr were identified in th e Consent Decrees revi ewed. The review determined that approximately 30% (231 of 776) of the process heaters for which operating data was available operated at <50% of design firing for the year identified, 56 of those process heaters operated at <25% of desi gn firing for the year and 16 ope rated at <10% of design firing for the year. The Consent Decrees generally contained operating data for two years and, in general, operating rates appear to track from year to year.

Examples of process heaters operating at hi gh turndown for extended periods provided by our

members include:

 One API member reports sizing a process heat er to handle cold imported material in addition to warm site-generated material and having the import project cancelled for economic reasons after the process heater wa s installed, leaving the process heater to operate at much less the 50% of capacity.

 Another member reports a process heater that changed service from a cat feed hydrotreater to a diesel hydrotreater in 2006 in response to EPA's Ultra Low Sulfur Diesel requirements, which resulted in an initial annual heat dut y of about 9 MMBTU/hr versus a design duty of 51 MMBTI/hr.

 A regeneration heater at a Powerformer (re former) is used to heat nitrogen to initiate burns when reactor catalyst is rege nerated and to heat up the reactor prior to putting it back on line. The capacity of the heater is 66 MMBtu/hr and it operated for 7672 hours last year below 33 MMBtu/hr (50%). The average heat duty for the year was

19.7 MMBtu/hr.API/NPRA/WSPA Process Heater Turndown Position 11-19-09 Page 5

 A FCCU preheater is reported to typi cally fire about 50 MMBTU/hr, though it was originally designed for 350 MMBTU/hr. This particular preheater is equipped with a

CEM that shows NOx concentrations incr ease by 50-100% at turndown rates versus design rates.

In several of the above examples, the process h eater is sized for the highest duty needed even though the heater operates at high turndown part of the time. In other examples, the process

heater was sized for a different service than it is currently serving. In these later cases, operating in turndown mode is appropriate because the dema nd on the heater may increase in the future or because spacing issues, timing or cost make installing a replacement unjustified by the very

small increment of NOx reductions that might be obtained.

We believe these situations are representative of a subset of process heaters that may find they cannot meet the Subpart Ja NOx requirements on b ecoming subject to Subpart Ja and that relief is therefore justified.

4. There is precedent for applying a mass emission limit for turndown operation.

This is not a new issue and there is preceden t for addressing turndow n process heater NOx emissions by applying a mass limit.

In the South Coast Air Quality Management Dist rict NOx rule for refineries (SCAQMD Rule 1109), section (b)(1)(B)(iii) provide s for a mass emission limit equal to the NOx emissions that would occur at maximum rates for boilers and pr ocess heaters that operate at “less than the maximum rated capacity.”

As we indicated in our September 9, 2009 letter, the Bay Area Air Qualit y Management District has approved NOx mass emission limits equivalent to the NOx emissions that would occur at maximum rates for two process heater s at Valero’s Be nicia refinery.

More generally, in the early days of Title V in the Bay Area (2003-2004), the 5 Bay Area refineries negotiated the “NOx Box” permit c ondition which was for small heaters without NOx CEMs. Basically, the x-y coordi nates are fired duty and O 2 concentration, and source testing

defined the “NO X Box” on those axes so that operati on within the Box was deemed compliant and operation outside was a deviation requiring additional source testing to determine compliance. The NO X Box permit condition also recognized periods of curtailed operation <20% of rated fired duty for up to 5 days (refr actory dry out, etc.). The key to the permit condition is the “either / or” langu age so that you have to meet a certain concentration averaged over X hours, OR a mass limit averaged over X hours.