EP A/450/3-811003a Office of Air Quality EPA-450 3-81-003a 

:t1on Plann1ng and Standards 

Research Tnangle Park NC 27711 

VOC Emissions 

from Volatile 

Organic Liquid 

Draft 

EIS 

Storage Tanks -

Background Information 

for Proposed Standards 

Preliminary Draft 
EPA-450/3-81-003a 

VOC Emissions from Volatile Organic 

Liquid Storage Tanks -

Background Information 

for Proposed Standards 

Emission Standards and Engineering Division 

U.S. ENVIRONMENTAL PROTECTION AGENCY 

Office of Air, Noise, and Radiation 

Office of Air Quality Planning and Standards 

Research Triangle Park, North Carolina 27711 
Section 

1 

2 

3 

4 

5 

TABLE OF CONTENTS 

SUMMARY 

1.1 Regulatory Alternatives 

1.2 Environmental Impact. 

1.3 Economic Impacts ... 

INTRODUCTION 

2.1 Background and Authority for Standards .... 

2.2 Selection of Categories of Stationary Sources 

2.3 Procedure for Development of Standards of 

2.4 

2.5 

2.6 

2.7 

Performance . . . . . . . . . . . . . . 

Consideration of Costs .. 

Consideration of Environmental Impacts. 

Impact on Existing Sources ..... . 

Revision of Standards of Performance. 

VOLATILE ORGANIC LIQUID STORAGE. 

3.1 The Volatile Organic Liquid Storage Industry. 

3.2 Storage Tanks ...... . 

3.3 Baseline Control and Emissions Estimates. 

3.4 References .. 

CONTROL TECHNIQUES 

4.1 Overview ... 

4.2 Fixed Roof Tanks. 

4.3 Internal Floating Roof Tanks. 

4.4 External Floating Roof Tanks. 

4.5 Vapor Control or Recovery Systems on Fixed Roof 

Page 

1-1 

1-1 

1-2 

1-2 

2-1 

2-4 

2-6 

2-8 

2-9 

2-10 

2-11 

3-1 

3-1 

3-3 

3-34 

3-39 

4-1 

4-1 

4-7 

4-9 

4-17 

Tanks . . . 4-20 

4.6 References. 4-25 

MODIFICATION AND RECONSTRUCTION. 5-1 

5.1 Provisions for Modifications and Reconstruction 5-1 

5.2 Applicability to Volatile Organic Liquid Storage. 5-3 

(continued) 
TABLE OF CONTENTS (Concluded) 

Section 

6 REGULATORY ALTERNATIVES AND MODEL PLANTS 

6.1 Regulatory Alternatives 

7 

8 

6.2 Model Plants ... 

ENVIRONMENTAL IMPACTS. 

7.1 Introduction ... 

7.2 Air Pollution Impacts 

7.3 Water Quality and Solid Waste Impacts 

7. 4 Energy Impact . . . . . . . . 

7.5 Other Environmental Concerns 

7.6 References 

COST ANALYSIS .. 

8.1 Capital Costs 

8.2 Annualized Capital Costs. 

8.3 Annualized Costs .. . 

8.4 Cost Effectiveness ... . 

8.5 Cost of Other Federal Regulations . 

8.6 Costs and Cost Effectiveness of Controls on an 

Page 

6-1 

6-1 

6-4 

7-1 

7-1 

7-1 

7-5 

7-6 

7-6 

7-7 

8-1 

8-2 

8-18 

8-20 

8-20 

8-21 

Individual Tank 8-27 

9 

APPENDICES 

8.7 References. 8-34 

ECONOMIC IMPACT 

9.1 Industry Profile 

9.2 Economic Impacts of Regulatory Alternatives 

9.3 Regulatory, Inflationary, Socioeconimic, and 

Small-Business Impact 

9.4 References 

A 

B 

i i 

9-1 

9-1 

9-30 

9-49 

9-51 

A-1 

B-1 
Figure 

3-1 

3-2 

3-3 

3-4 

3-5 

3-6 

3-7 

3-8 

3-9 

3-10 

3-11 

3-12 

4-1 

4-2 

4-3 

4-4 

9-1 

9-2 

LIST OF FIGURES 

Typical fixed roof tank ... 

External floating roof tank . 

Internal floating roof tanks. 

Primary seals .. 

Rim-mounted secondary seals on external floating 

roofs . . . . . . . . . . . . . . . . . . . 

Metallic shoe seal with shoe-mounted secondary seal 

Typical flotation devices and perimeter seals for 

internal floating roofs ............ . 

Rim mounting of a secondary seal on internal floating 

roof. . . . . . . . . . . . . . . . . ... 

Typical internal floating roof tank cross section 

Internal floating roof deck fittings .. 

Baseline control summary ....... . 

Baseline emissions totals (Mg/yr: 1977 tank population) 

and numbers of tanks by vapor pressure/tank size 

region. . . . . . . . . . . . . . . . . . 

Emissions rates for alternative equipment types 

(50 turnovers per year) . . . ........ . 

Emissions rates for alternative equipment types 

(10 turnovers per year) . . . . . . . . . . .. 

Carbon adsorption unit using steam regeneration 

Thermal oxidation unit ....... . 

Organic chemical industry flow chart 

VOL storage tank market for tanks in volume interval 

as characterized in the economic impact analysis 

i i i 

Page 

3-5 

3-7 

3-8 

3-11 

3-13 

3-14 

3-16 

3-18 

3-20 

3-21 

3-36 

3-38 

4-5 

4-6 

4-22 

4-24 

9-2 

9-33 
Table 

1-1 

3-1 

3-2 

3-3 

3-4 

3-5 

3-6 

4-1 

4-2 

4-3 

4-4 

4-5 

4-6 

6-1 

6-2 

7-1 

7-2 

8-1 

8-2 

LIST OF TABLES 

Assessment of Environmental, Energy, and Economic 

Impacts for Each Regulatory Alternative Considered 

for New VOL Storage Vessels ........... . 

National Industrial VOL Tank Distribution According to 

Vapor Pressure (1977) . . . . . . . . . . . . . . . 

National Industrial VOL Tank Distribution According to 

Tank Size (1977). . . . . . . . . . . . . . . . . 

Statistics for the National Tank Population in VOL 

Terminal Storage (1979) ........... . 

Seal Related Factors for External Floating Roof 

Tanks . . . . . . . . . . . . . . . . . . ... 

Typical Number of Columns as a Function of Tank 

Diameters ............... . 

Summary of Deck Fitting Loss Factors (Kf) and 

Typical Number of Fittings (Nf) ...... . 

Hierarchy of Equipment Types Based on Emissions Rate. 

Model Tank Emission Rates for Different Equipment 

Options . . . . . . . . . . . . . . . . . . . 

Effectiveness of Internal and External Floating Roof 

Tanks Compared to a Fixed Roof Tank for the Model 

Tank. . . . . . . . . . . . ....... . 

11 Controlled 11 and 11 Uncontrolled 11 Internal Floating Roof 

Deck Fittings ................. . 

Internal Floating Roof Rim Seal Systems Seal Loss 

Factors and Control Efficiencies ....... . 

External Floating Roof Tank Seal System Control 

Efficiencies ..... . 

Model Terminal .... . 

Model Producer/Consumer 

Fifth-Year Emissions Resulting from the Regulatory 

Alternatives. . . . . . . . . . . .... 

Fifth-Year Emissions Reductions Resulting from the 

Regulatory Alternatives ..... . 

Estimated Installed Capital Cost of a Fixed Roof 

Tank . . . . . . . . . . . . . . ..... 

Estimated Installed Capital Cost of a Noncontact 

Internal Floating Roof ..... . 

(continued) 

iv 

1-3 

3-2 

3-2 

3-4 

3-28 

3-32 

3-33 

4-3 

4-8 

4-11 

4-12 

4-14 

4-19 

6-6 

6-6 

7-3 

7-4 

8-3 

8-4 
Table 

8-3 

8-4 

8-5 

8-6 

8-7 

8-8 

8-9 

8-10 

8-11 

8-12 

8-13 

8-14 

8-15 

8-16 

8-17 

8-18 

8-19 

8-20 

8-21 

8-22 

8-23 

8-24 

LIST OF TABLES (Continued) 

Estimated Installed Cost of a Welded Contact 

Floating Roof with Secondary Seals ..... 

Estimated Installed Capital Cost of External 

Roof Tanks with Secondary Seals .. 

Cost of Regulatory Alternative I . 

Cost of Regulatory Alternative II. 

Cost of Regulatory Alternative III 

Cost of Regulatory Alternative IV. 

Cost of Regulatory Alternative V . 

Internal 

Floating 

Cost of External Floating Roof Tanks with Primary Seal 

and Secondary Seal . . . . . . ........... . 

Cost of External Floating Roof Tanks with Liquid-Mounted 

Primary Seal and Secondary Seal ........ . 

Cost of Vapor Control by Incineration Techniques 

Cost of Vapor Recovery by Carbon Adsorption 

Techniques ......... . 

Lifetimes of Control Equipment . 

Cost Annualizing Assumptions .. 

Federal Laws Regulating Toxic Chemicals. 

Statutes That May be Applicable to the Manufacture and 

Storage of Volatile Organic Liquids ... _ ..... 

Proposed Regulations That Will Affect the Chemical 

Manufacturing Industry ............. . 

Capital and Annualized Costs for Baseline and Control 

Equipment for the Model VOL Tank ..... 

Absolute Cost Effectiveness of Controlling Fixed Roof 

Tank Emissions from the Model Tank ......... . 

Incremental Cost Effectiveness between Internal Floating 

Roof Seal Types in the Model Tank ....... . 

Incremental Cost Effectiveness of Controlling Deck 

Seam Emissions in the Mode 1 Tank . . . . . . . . . 

Regulatory Alternatives and Incremental Cost 

Effectiveness ($/Mg) between Regulatory Alternatives 

in the Model Tank ................ . 

Incremental Cost Effectiveness between Equipment 

Specified by Each Regulatory Alternative and an External 

Floating Roof Tank with a Mechanical Shoe Seal and a 

Secondary Seal .................... . 

(continued) 

v 

8-5 

8-6 

8-9 

8-10 

8-11 

8-12 

8-13 

8-14 

8-15 

8-16 

8-17 

8-19 

8-19 

8-22 

8-23 

8-26 

8-28 

8-29 

8-30 

8-31 

8-32 

8-33 
Table 

9-1 

9-2 

9-3 

9-4 

9-5 

LIST OF TABLES (Continued) 

Resource Use by Producers of Industrial 

Organic Chemicals (SIC 286) ..... 

Resource Use by Producers of Plastics Materials 

and Synthetics (SIC 282) ......... . 

Capital Expenditures and Operating Rates for 

SIC 286 and SIC 282, 1958-1978 ....... . 

Historical Production and Sales of Industrial 

Organic Chemicals, 1955-1981 ..... . 

Historical Production and Sales of Plastics 

and Resins Materials, 1955-1981 ..... . 

9-6 Export and Import Values of Industrial Organic Chemicals 

(SIC 286) Excluding Gum and Wood Chemicals (SIC 2861) 

9-6 

9-7 

9-8 

9-10 

9-11 

for Selected Years Between 1972 and 1981 . . . . . . 9-13 

9-7 

9-8 

Export and Import Values of Plastics Materials and 

Synthetics (SIC 282) for Selected Years Between 

1972 and 1981 . . . . . . . . . . . . . . . . . . . 

Industry-wide Market Concentration Based on 

Capacity Share Data, 1976 ........ . 

9-9 Geographic Distribution of Establishments, Employees, 

and Value of Shipments of SIC 286, Industrial Organic 

9-13 

9-17 

Chemicals ......................... 9-18 

9-10 

9-11 

9-12 

9-13 

9-14 

9-15 

Geographic Distribution of Establishments, Employees, 

and Value of Shipments of SIC 282, Plastics Materials 

and Synthetics . . . . . . . . . . . . .- . . . . . . 

Total 1982 Merchant Liquid Bulk Capacity, by State 

Historical Price Data for Industrial Organic Chemicals 

and Plastics, Resins, and Elastomers, 1955-1981 .... 

Projection of VOL Storage Tank Construction--1984 to 

1988 All Capacities, Vapor Pressures, and Roof Designs 

Estimated Percentage Distribution of VOL Storage Tanks 

by Vapor Pressure and Tank Capacity, 1977 ...... . 

Projection of VOL Storage and Construction by 

Vapor Pressure and Tank Size, 1984-1988 ... 

9-16 Price Impacts of the Regulatory Alternatives for the 

9-20 

9-21 

9-23 

9-28 

9-29 

9-31 

Model Terminal and Model Producer/Consumer 9-37 

9-17 Percentage Change in Output Price for the Model Plants 

Due to the Regulatory Alternatives . . . . . . . . . . 9-38 

9-18 Investment Impacts of Regulatory Alternatives for the 

Model Independent Terminal and Model Producer/Consumer 

(103 $1982) . . . . . . . . . . . . . . . . . . . . . . . . 9-40 

(continued) 

vi 
Table 

9-19 

9-20 

9-21 

9-22 

LIST OF TABLES (Concluded) 

The New Tank Population Impacted by Regulatory 

Alternative I as a Percentage of the Projected New 

Tank Population ............... . 

The New Tank Population Impacted by Regulatory 

Alternatives II-V as a Percentage of the Projected 

New Tank Population ............... . 

Additional Nationwide Investment in VOL Storage 

Required by the Regulatory Alternatives, 1984-1988 

Fifth-Year Nationwide Annualized Cost of the 

Regulatory Alternatives ....... . 

vii 

. .... 9-42 

9-43 

9-47 

9-48 
1. SUMMARY 

Standards of performance for new stationary sources are established 

under Section 111 of the Clean Air Act (42 U.S.C. 7411), as amended in 

1977. Section 111 directs the Administrator to establish standards of 

performance for any category of new stationary source of air pollution 

which 11 Causes or contributes significantly to, air pollution which may 

reasonably be anticipated to endanger public health or welfare. 11 This 

background information document supports the proposed standards, which 

would control emissions of volatile organic compounds (VOCs) from vessels 

that store volatile organic liquids (VOLs). VOL storage vessels are 

primarily located at chemical manufacturing facilities and bulk storage 

terminals. These vessels are used for storing a variety of materials, 

including raw materials, final products, and/or usable byproducts, as 

well as waste tars, residues, and nonusable byproducts. 

1.1 REGULATORY ALTERNATIVES 

In order to evaluate the environmental, economic, and energy impacts 

associated with implementation of a standard for VOL storage vessels, 

the Administrator has examined the impacts of several regulatory 

alternatives for VOL storage vessels. The VOL regulatory alternatives, 

in order of increasing emission control potential, would require that 

each vessel storing a VOL be equipped with the control technology described 

as follows: 

• Regulatory Alternative 0 - no additional control over baseline. 

• Regulatory Alternative I - an internal floating roof with a 

vapor-mounted primary seal (IFRvm). 

• Regulatory Alternative II - an internal floating roof with a 

liquid-mounted primary seal (IFR1

m). 
• Regulatory Alternative III - an internal floating roof with a 

liquid-mounted primary seal and controlled deck fittings 

(IFR1 f). m,c 

• Regulatory Alternative IV - an internal floating roof with a 

liquid-mounted primary seal controlled deck fittings, and a 

continuous secondary seal (IFR1 f ). m,c ,ss 

• Regulatory Alternative V - a welded internal floating roof 

with a liquid-mounted primary seal, controlled deck fittings 

and a continuous secondary seal ( IFR1 f ). w m,c ,ss 

1.2 ENVIRONMENTAL IMPACT 

The environmental regulatory alternatives are summarized in Table 1-1. 

None of the alternatives has any adverse environmental impacts. The 

environmental impacts are discussed in detail in Chapter 7. 

1.3 ECONOMIC IMPACTS 

The economic impacts are also summarized in Table 1-1. None of the 

alternatives have any potential adverse economic impacts. The economic 

impacts are discussed in detail in Chapter 9. 

1-2 
....... 

I 

w 

Table 1-1. ASSESSMENT OF ENVIRONMENTAL, ENERGY, AND ECONOMIC IMPACTS FOR EACH 

REGULATORY ALTERNATIVE CONSIDERED FOR NEW VOL STORAGE VESSELS 

Solid 

Administrative Air Water waste Energy Economic 

alternative impact impact impact impact impact 

Regulatory Alternative 0 -2** 0 0 0 0 

Regulatory Alternative I +1** 0 0 0 -1** 

Regulatory Alternative II +2** 0 0 0 -1** 

Regulatory Alternative III +3** 0 0 0 -1** 

Regulatory Alternative IV +3** 0 0 0 -1** 

Regulatory Alternative V +3** 0 0 0 -3** 

aKEY: + Beneficial impact 2 Small impact * Short term impact 

Adverse impact 3 Moderate impact ** Long term impact 

0 No impact 4 Large impact *** Irreversible impact 

1 Negligible impact 5 Very large impact 
2. INTRODUCTION 

2.1 BACKGROUND AND AUTHORITY FOR STANDARDS 

Before standards of performance are proposed as a Federal regulation, 

air pollution control methods available to the affected industry and the 

associated costs of installing and maintaining the control equipment are 

examined in detail. Various levels of control based on different 

technologies and degrees of efficiency are expressed as regulatory 

alternatives. Each of these alternatives is studied by EPA as a 

prospective basis for a standard. The alternatives are investigated in 

terms of their impacts on the economics and well-being of the industry, 

the impacts on the national economy, and the impacts on the environment. 

This document summarizes the information obtained through these studies 

so that interested persons will be able to see the information considered 

by EPA in the development of the proposed standard. 

Standards of performance for new stationary sources are established 

under Section 111 of the Clean Air Act (42 U.S.C. 7411) as amended, 

hereinafter referred to as the Act. Section 111 directs the Administrator 

to establish standards of performance for any category of new stationary 

source of air pollution which 11 Causes, or contributes significantly to, 

air pollution which may reasonably be anticipated to endanger the public 

health or welfare." 

The Act requires that standards of performance for stationary 

sources reflect 11 the degree of emission reduction achievable which 

(taking into consideration the cost of achieving such emission reduction, 

and any nonair quality health and environmental impact and energy 

requirements) the Administrator determines has been adequately 

demonstrated for that category of sources. 11 The standards apply only to 

stationary sources whose construction or modification commences after 

regulations are proposed by publication in the Federal Register. 
The 1977 amendments to the Act altered or added numerous provisions 

that apply to the process of establishing standards of performance. 

1. EPA is required to review the standards of performance every 

4 years and, if appropriate, revise them. 

2. EPA is authorized to promulgate a standard based on design, 

equipment, work practice, or operational procedures when a standard 

based on emission levels is not feasible. 

3. The term 11 standards of performance 11 is redefined, and a new 

term 11 technological system of continuous emission reduction11 is defined. 

The new definitions clarify that the control system must be continuous 

and may include a low-polluting or nonpolluting process or operation. 

4. The time between the proposal and promulgation of a standard 

under Section 111 of the Act may be extended to 6 months. 

Standards of performance, by themselves, do not guarantee protection 

of health or welfare because they are not designed to achieve any specific 

air quality levels. Rather, they are designed to reflect the degree of 

emission limitation achievable through application of the best adequately 

demonstrated technological system of continuous emission reduction, 

taking into consideration the cost of achieving such emission reduction, 

any nonair quality health and environmental impacts, and energy 

requirements. 

Congress had several reasons for including these requirements. 

First, standards with a degree of uniformity are needed to avoid situations 

in which some States may attract industries by relaxing standards relative 

to other States. Second, stringent standards enhance the potential for 

long-term growth. Third, stringent standards may help achieve long-term 

cost savings by avoiding the need for more expensive retrofitting if 

pollution ceilings are reduced in the future. Fourth, certain types of 

standards for coal-burning sources can adversely affect the coal market 

by driving up the price of low-sulfur coal or effectively excluding 

certain coals from the reserve base because their untreated pollution 

potentials are high. Congress does not intend that new source performance 

standards contribute to these problems. Fifth, the standard-setting 

process should create incentives for improved technology. 

2-2 
Promulgation of standards of performance does not prevent State or 

local agencies from adopting more stringent emission limitations for the 

same sources. States are free under Section 116 of the Act to establish 

even more stringent emission limits than those established under Section 111 

or those necessary to attain or maintain the National Ambient Air Quality 

Standards (NAAQS) under Section 110. Thus, new sources may in some 

cases be subject to limitations more stringent than standards of performance 

under Section 111, and prospective owners and operators of new sources 

should be aware of this possibility in planning for such facilities. 

A similar situation may arise when a major emitting facility is to 

be constructed in a geographic area that falls under the provisions for 

prevention of significant deterioration of air quality in Part C of the 

Act. These provisions require, among other things, that major emitting 

facilities to be constructed in such areas be subject to best available 

control technology. The term 11 best available control technolog/' (BACT), 

as defined in the Act, means: 

an emission limitation based on the maximum degree of reduction 

of each pollutant subject to regulation under this Act emitted 

from, or which results from, any major emitting facility, 

which the permitting authority, on a case-by-case basis, 

taking into account energy, environmental, and economic impacts 

and other costs, determines is achievable for such facility 

through application of production processes and available 

methods, systems, and techniques, including fuel cleaning or 

treatment or innovative fuel combustion techniques for control 

of each such pollutant. In no event shall application of 11 best available control technology11 result in emissions of any 

pollutants which will exceed the emissions allowed by any 

applicable standard established pursuant to Sections 111 or 

112 of this Act. (Section 169(3)). 

Although standards of performance are normally structured in terms 

of numerical emission limits where feasible, alternative approaches are 

sometimes necessary. In some cases, physical measurement of emissions 

from a new source may be impractical or exorbitantly expensive. 

Section 111(h) provides that the Administrator may promulgate a design 

or equipment standard in those cases in which it is not feasible to 

prescribe or enforce a standard of performance. For example, emissions 

of hydrocarbons from storage vessels for petroleum liquids are greatest 

during tank filling. The nature of the emissions (high concentrations 

2-3 
for short periods during filling and low concentrations for longer 

periods during storage) and the configuration of storage tanks make 

direct emission measurement impractical. Therefore, a more practical 

approach to standards of performance for storage vessels has been equipment 

specification. 

In addition, Section 111(j) authorizes the Administrator to grant 

waivers of compliance to permit a source to use innovative continuous 

emission control technology. To grant the waiver, the Administrator 

must find (1) a substantial likelihood that the technology will produce 

greater emission reductions than the standards require, or an equivalent 

reduction at lower economic, energy, or environmental cost, (2) the 

proposed system has not been adequately demonstrated, (3) the technology 

will not cause or contribute to an unreasonable risk to the public 

health, welfare, or safety, (4) the governor of the State where the 

source is located consents, and (5) the waiver will not prevent the 

attainment or maintenance of any ambient standard. A waiver may have 

conditions attached to ensure that the source will not prevent attainment 

of any NAAQS. Any such condition will have the force of a performance 

standard. Finally, waivers have definite end dates and may be terminated 

earlier if the conditions are not met or if the system fails to perform 

as expected. In such a case, the source may be given up to 3 years to 

meet the standards with a mandatory progress sched~le. 

2.2 SELECTION OF CATEGORIES OF STATIONARY SOURCES 

Section 111 of the Act directs the Adminstrator to list categories 

of stationary sources. The Administrator 11 shall include a category of 

sources in such list if in his judgment it causes, or contributes 

significantly to, air pollution which may reasonably be anticipated to 

endanger public health or welfare. 11 Proposal and promulgation of standards 

of performance are to follow. 

Since passage of the Clean Air Amendments of 1970, considerable 

attention has been given to the development of a system for assigning 

priorities to various source categories. The approach specifies areas 

of interest by considering the broad strategy of the Agency for implementing 

the Clean Air Act. Often, these 11 areas 11 are actually pollutants emitted 

2-4 
by stationary sources. Source categories that emit these pollutants are 

evaluated and ranked by a process involving such factors as (1) the 

level of emission control (if any) already required by State regulations, 

(2) estimated levels of control that might be required from standards of 

performance for the source category, (3) projections of growth and 

replacement of existing facilities for the source category, and (4) the 

estimated incremental amount of air pollution that could be prevented in 

a preselected future year by standards of performance for the source 

category. Sources for which new source performance standards were 

promulgated or were under development during 1977, or earlier, were 

selected on these criteria. 

The Act amendments of August 1977 establish specific criteria to be 

used in determining priorities for all major source categories not yet 

listed by EPA. These are (1) the quantity of air pollutant emissions 

that each such category will emit or will be designed to emit, (2) the 

extent to which each such pollutant may reasonably be anticipated to 

endanger public health or welfare, and (3) the mobility and competitive 

nature of each such category of sources and the consequent need for 

nationally applicable new source standards of performance. 

The Administrator is to promulgate standards for these categories 

according to the schedule referred to earlier. 

In some cases, it may not be feasible to immediately develop a 

standard for a source category with a high priority. This situation 

might occur when a program of research is needed to develop control 

techniques, or because techniques for sampling and measuring emissions 

may require refinement. In developing standards, differences in the 

time required to complete the necessary investigation for different 

source categories must also be considered. For example, substantially 

more time may be necessary if numerous pollutants must be investigated 

from a single source category. Furthermore, even late in the development 

process, the schedule for completion of a standard may change. For 

example, inability to obtain emission data from well-controlled sources 

in time to pursue the development process systematically may force a 

change in scheduling. Nevertheless, priority ranking is, and will 

continue to be, used to establish the order in which projects are initiated 

and resources assigned. 

2-5 
After the source category has been chosen, the types of facilities 

within the source category to which the standard will apply must be 

determined. A source category may have several facilities that cause 

air pollution; emissions from these facilities may vary from insignificant 

to very expensive to control. Economic studies of the source category 

and of applicable control technology may show that air pollution control 

is better served by applying standards to the more severe pollution 

sources. For this reason, and because there is no adequately demonstrated system for controlling emissions from certain facilities, standards 

often do not apply to all facilities at a source. For the same reasons, 

the standards may not apply to all air pollutants emitted. Thus, although 

a source category may be selected to be covered by a standard of 

performance, all pollutants or facilities within that source category 

might not be covered by the standards. 

2.3 PROCEDURE FOR DEVELOPMENT OF STANDARDS OF PERFORMANCE 

Standards of performance must (1) realistically reflect best 

demonstrated control practice, (2) adequately consider the cost, the 

nonair-quality health and environmental impacts, and the energy requirements 

of such control, (3) be applicable to existing sources that are modified 

or reconstructed as well as to new installations, and (4) m~et these 

conditions for all variations of operating conditions being considered 

anywhere in the country. 

The objective of a program for developing standards is to identify 

the best technological system of continuous emission reduction that has 

been adequately demonstrated. The standard-setting process involves 

three principal phases of activity: (1) information gathering, (2) analysis 

of the information, and (3) development of the standard of performance. 

During the information-gathering phase, industries are queried 

through a telephone survey, letters of inquiry, and plant visits by EPA 

representatives. Information is also gathered from many other sources, 

and a literature search is conducted. From the knowledge acquired about 

the industry, EPA selects certain plants at which emission tests are 

conducted to provide reliable data that characterize the pollutant 

emissions from well-controlled existing facilities. 

2-6 
In the second phase of a project, the information about the industry 

and the pollutants emitted is used in analytical studies. Hypothetical 

11 model plants 11 are defined to provide a common basis for analysis. The 

model plant definitions, national pollutant emission data, and existing 

State regulations governing emissions from the source category are then 

used in establishing "regulatory alternatives." These regulatory 

alternatives are essentially different levels of emission control. 

EPA conducts studies to determine the impact of each regulatory 

alternative on the economics of the industry and on the national economy, 

on the environment, and on energy consumption. From several possibly 

applicable alternatives, EPA selects the single most plausible regulatory 

alternative as the basis for a standard of performance for the source 

category under study. 

In the third phase of a project, the selected regulatory alternative 

is translated into a standard of performance, which, in turn, is written 

in the form of a Federal regulation. The Federal regulation, when 

applied to newly constructed plants, will limit emissions to the levels 

indicated in the selected regulatory alternative. 

As early as is practical in each standard-setting project, EPA 

representatives discuss the possibilities of a standard, and the form it 

might take with members of the National Air Pollution Control Techniques 

Advisory Committee. Industry representatives and 9ther interested 

parties also participate in these meetings. 

The information acquired in the project is summarized in the background 

information document (BID). The BID, the standard, and a preamble 

explaining the standard are widely circulated to the industry being 

considered for control, environmental groups, other government agencies, 

and offices within EPA. Through this extensive review process, the 

viewpoints of expert reviewers are considered as changes are made to the 

documentation. 

A "proposal package" is assembled and sent through the offices of 

EPA Assistant Administrators for concurrence before the proposed standard 

is officially endorsed by the EPA Administrator. After being approved 

by the EPA Administrator, the preamble and the proposed regulation are 

published in the Federal Register. 

2-7 
As a part of the Federal Register announcement of the proposed 

regulation, the public is invited to participate in the standard-setting 

process. EPA invites written comments on the proposal and also holds a 

public hearing to discuss the proposed standard with interested parties. 

All public comments are summarized and incorporated into a second volume 

of the BID. All information reviewed and generated in studies in support 

of the standard of performance is available to the public in a 11 docket 11 

on file in Washington, D.C. 

Comments from the public are evaluated, and the standards of 

performance may be altered in response to the comments. 

The significant comments and EPA 1 s position on the issues raised 

are included in the 11 preamble 11 of a promulgation package, which also 

contains the draft of the final regulation. The regulation is then 

subjected to another round of review and refinement until it is approved 

by the EPA Administrator. After the Administrator signs the regulation, 

it is published as a 11 final rule 11 in the Federal Register. 

2.4 CONSIDERATION OF COSTS 

Section 317 of the Act requires an economic impact assessment with 

respect to any standard of performance established under Section 111 of 

the Act. The assessment is required to contain an analysis of (1) the 

costs of compliance with the regulation, including the extent to which 

the cost of compliance varies depending on the effective date of the 

regulation and the development of less expensive or more efficient 

methods of compliance, (2) the potential inflationary or recessionary 

effects of the regulation, (3) the effects the regulation might have on 

small business with respect to competition, (4) the effects of the 

regulation on consumer costs, and (5) the effects of the regulation on 

energy use. Section 317 also requires that the economic impact assessment 

be as extensive as practicable. 

The economic impact of a proposed standard upon an industry is 

usually addressed both in absolute terms and in terms of the control 

costs that would be incurred as a result of compliance with typical, 

existing State control regulations. An incremental approach is necessary 

because both new and existing plants would be required to comply with 

2-8 
State regulations in the absence of a Federal standard of performance. 

This approach requires a detailed analysis of the economic impact from 

the cost differential that would exist between a proposed standard of 

performance and the typical State standard. 

Air pollutant emissions may cause water pollution problems, and 

captured potential air pollutants may pose a solid waste disposal problem. 

The total environmental impact of an emission source must, therefore, be 

analyzed and the costs determined whenever possible. 

A thorough study of the profitability and price-setting mechanisms 

of the industry is essential to the analysis so that an accurate estimate 

of potentially adverse economic impacts can be made for proposed standards. 

It is also essential to know the capital requirements for pollution 

control systems already placed on plants so that the additional capital 

requirements necessitated by these Federal standards can be placed in 

proper perspective. Finally, it is necessary to assess the availability 

of capital to provide the additional control equipment needed to meet 

the standards of performance. 

2.5 CONSIDERATION OF ENVIRONMENTAL IMPACTS 

Section 102(2)(C) of the National Environmental Policy Act (NEPA) 

of 1969 requires Federal agencies to prepare detailed environmental 

impact statements on proposals for legislation and other major Federal 

actions significantly affecting the quality of the human environment. 

The objective of NEPA is to build into the decisionmaking process of 

Federal agencies a careful consideration of all environmental aspects of 

proposed actions. 

In a number of legal challenges to standards of performance for 

various industries, the United States Court of Appeals for the District 

of Columbia Circuit has held that environmental impact statements need 

not be prepared by the Agency for proposed actions under Section 111 of 

the Clean Air Act. Essentially, the Court of Appeals has determined 

that the best system of emission reduction requires the Administrator to 

take into account counter-productive environmental effects of a proposed 

standard, as well as economic costs to the industry. On this basis, 

therefore, the Court established a narrow exemption from NEPA for EPA 

determination under Section 111. 

2-9 
In addition to these judicial determinations, the Energy Supply and 

Environmental Coordination Act (ESECA) of 1974 (PL-93-319) specifically 

exempted proposed actions under the Clean Air Act from NEPA requirements. 

According to Section 7(c)(1), 11 no action taken under the Clean Air Act 

shall be deemed a major Federal action significantly affecting the 

quality of the human environment within the meaning of the National 

Environmental Policy Act of 1969. 11 (15 U.S.C. 793(c)(l)) 

Nevertheless, the Agency has concluded that the preparation of 

environmental impact statements could have beneficial effects on certain 

regulatory actions. Consequently, although not legally required to do 

so by Section 102(2)(C) of NEPA, EPA has adopted a policy requiring that 

environmental impact statements be prepared for various regulatory 

actions, including standards of performance developed under Section 111 

of the Act. This voluntary preparation of environmental impact statements, 

however, in no way legally subjects the Agency to NEPA requirements. 

To implement this policy, a separate section in this document is 

devoted solely to an analysis of the potential environmental impacts 

associated with the proposed standards. Both adverse and beneficial 

impacts in such areas as air and water pollution, increased solid waste 

disposal, and increased energy consumption are discussed. 

2.6 IMPACT ON EXISTING SOURCES 

Section 111 of the Act defines a new source as 11 any stationary 

source, the construction or modification of which is commenced11 after 

the proposed standards are published in the Federal Register. An existing 

source is redefined as a new source if 11 modified11 or 11 reconstructed11 as 

defined in amendments to the general provisions of Subpart A of 40 CFR 

Part 60, which were promulgated in the Federal Register on December 16, 1975 

(40 FR 58416). 

Any physical or operational change to an existing facility which 

results in an increase in the emission rate of any pollutant for which a 

standard applies is considered a modification. Reconstruction, on the 

other hand, means the replacement of components of an existing facility 

to the extent that the fixed capital cost exceeds 50 percent of the cost 

of constructing a comparable entirely new source and that it be technically 

2-10 
and economically feasible to meet the applicable standards. In such 

cases, reconstruction is equivalent to a new construction. 

Promulgation of a standard of performance requires States to establish 

standards of performance for existing sources in the same industry under 

Section 111(d) of the Act if the standard for new sources limits emissions 

of a designated pollutant (i.e., a pollutant for which air quality 

criteria have not been issued under Section 108 or which has not been 

listed as a hazardous pollutant under Section 112). If a State does not 

act, EPA must establish such standards. General provisions outlining 

procedures for control of existing sources under Section 111(d) were 

promulgated on November 17, 1975, as Subpart B of 40 CFR Part 60 

(40 FR 53340). 

2.7 REVISION OF STANDARDS OF PERFORMANCE 

Congress was aware that the level of air pollution control achievable 

by any industry may improve with technological advances. Accordingly, 

Section 111 of the Act provides that the Administrator 11 shall, at least 

every 4 years, review and, if appropriate, revise 11 the standards. 

Revisions are made to ensure that the standards continue to reflect the 

best systems that become available in the future. Such revisions will 

not be retroactive but will apply to stationary sources constructed or 

modified after the proposal of the revised standards. 

2-11 
3. VOLATILE ORGANIC LIQUID STORAGE 

3.1 THE VOLATILE ORGANIC LIQUID STORAGE INDUSTRY 

Volatile organic liquid (VOL) storage vessels are primarily located 

at chemical manufacturing and producing facilities and at bulk liquid 

transfer terminals. An economic description of these industries is 

contained in Section 9.1. The storage of VOL within these industries is 

described below. 

3.1.1 Industrial Service (Chemical Manufacturing) 

Tanks are used for storing a variety of organic liquids, including 

raw materials, final products, and/or usable byproducts, as well as 

waste tars, residues, and other wastes. Available data were analyzed to 

determine the number of tanks in the nation containing volatile organic 

liquids. 1•

2•3 The 1977 industrial tank population was found to be 27,540. 4 

The vapor pressure of the material to be stored is a major factor 

in choosing the tank type to be used. In practice, fixed roof tanks are 

predominantly used for storing materials with vapor pressures up to 

34.5 kPa; floating-roof tanks are also used to store materials in the 

same range. Table 3-1 gives the distribution of tanks nationally, 

according to the vapor pressure of the VOLs stored in fixed and floating 

roof tanks. Other factors such as material stability, safety hazards, 

and multiple use also affect the choice of tank type for a particular 

organic liquid. Table 3-2 gives the national tank distribution by 

storage capacity for fixed roof and floating roof tanks. 

3.1.2 Terminal Service 

A terminal is a nonmanufacturing site that stores commodities in 

bulk quantity. Only those terminals that store VOL were of concern to 

this study. Telephone directories of selected cities were searched for 

terminal listings. As a result of this survey, it was determined that 

data obtained from the Independent Liquid Terminal Association (ILTA) 
Table 3-1. NATIONAL INDUSTRIAL VOL TANK DISTRIBUTION ACCORDING 

TO VAPOR PRESSURE (1977) 

Number of tanks nationwide 

Vapor pressure, 

(kPa) Fixed-roof Floating-roof 

0 - 3.5 16,350 170 

3.5 - 6.9 3,560 100 

6.9- 10.3 1,950 70 

10.3 - 34.5 3,800 790 

34.5- 58.6 500 40 

~58.6 190 20 

Total 26,350 1,190 

Percent of Total 95.7 4.3 

Total 

16,520 

3,660 

2,020 

4,590 

540 

210 

27,540 

100. 

Table 3-2. NATIONAL INDUSTRIAL VOL TANK DISTRIBUTION ACCORDING TO 

TANK SIZE (1977) 

Number of tanks nationwide 

Tank size, 

(m3) Fixed-roof Floating-roof Total 

0 - 75 12,270 20 12,290 

75 - 150 3,910 30 3,940 

150 - 375 3, 770 180 3,950 

375 - 3,750 5,840 610 6,450 

3,750 - 15,000 520 320 840 

~15,000 40 30 70 -- Total 26,350 1,190 27,540 

Percent of Total 95.7 4.3 100. 

3-2 
would serve as a sufficient approximation of the national terminal 

population. 5 Sixty-eight ILTA member companies operate more than 150 

terminals. Of these, 82 terminals handle VOLs. It was assumed that any 

terminal storing VOL devoted its entire storage volume to VOL. Statistics 

for the tanks in the 82 VOL terminals are given in Table 3-3. 

3.2 STORAGE TANKS 

3.2.1 Types of Storage Tanks 

There are three types of vessels of concern in developing standards 

of performance for VOL storage vessels: 

1 fixed roof tanks; 

1 external floating roof tanks; and 

1 internal floating roof tanks. 

These tanks are cylindrical in shape with the axis oriented perpendicular 

to the foundation. The tanks are almost exclusively above ground. 

Below-ground vessels and horizontal vessels (i.e. with the axis parallel 

to the foundation) also can be used in VOL service. However, these 

types of vessels are much less common in VOL service than the other tank 

types listed above. For the most part, are less than 100 cubic meters 

(26,400 gallons) in capacity. Consequently, their contribution to 

nationwide VOL storage emissions is minor. Controls applicable to 

horizontal tanks primarily are limited to closed vent systems and control 

devices as discussed in Chapter 4. Since their contribution to nationwide 

emissions is minor, no detailed equipment description is provided for 

these types of roofs. For a similar reason, no detailed equipment 

description is provided for pressure vessels. This section, therefore, 

addresses only fixed roof, external floating and internal floating roof 

tanks. 

3.2.1.1 Fixed Roof Tanks. Of currently used tank designs, the 

fixed-roof tank is the least expensive to construct and is generally 

considered as the minimum acceptable equipment for the storage of VOLs. 

A typical fixed-roof tank, which is shown in Figure 3-1, consists of a 

cylindrical steel shell with a cone- or dome-shaped roof that is permanently 

affixed to the tank shell. A breather valve (pressure-vacuum valve), 

which is commonly installed on many fixed roof tanks, allows the tank to 

3-3 
Table 3-3. STATISTICS FOR THE NATIONAL TANK POPULATION IN 

VOL TERMINAL STORAGE (1979) 

CAPACITY 

Total capacity in data base: 1.390 x 1010 liters (3,670 x 106 gal) 

Average capacity for a terminal: 1.78 x 108 liters (47 x 106 gal) 

Median capacity for a terminal: 9.35 x 107 liters (25 x 106 gal) 

NUMBER OF TANKS 

Total number of tanks at terminals in data base: 4,212 

Average number of tanks per terminal: 54 

Median number of tanks per terminal: 37.5 

SMALLEST TANKa 

Average size of smallest tank: 1.2 x 106 liters (318.9 x 103 gal) 

Median size of smallest tank: 1.59 x 105 liters (42 x 103 gal) 

AVERAGE TANK SIZE: 3.3 x 106 lite~s (872 x 103 gal) 

LARGEST TANKb 

Average size of largest tank: 

Median size of largest tank: 

1.36 x 107 liters- (3,599 x 103 gal) 

9.22 x 106 liters (2,436 x 103 gal) 

aVolume of the smallest tank at each terminal. 

bVolume of the largest tank at each terminal. 

3-4 
GAUGE HATCH 

MANHOLE 

Figure 3-1. Typical fixed roof tank. 

3-5 

NOZZLE 

(FOR SUBMERGED FILL 

OR DRAINAGE) 
operate at a slight internal pressure or vacuum. Because this valve 

prevents the release of vapors only during very small changes in 

temperature, barometric pressure, or liquid level, the emissions from a 

fixed roof tank can be appreciable. 

3.2.1.2 External Floating Roof Tanks. A typical external floating 

roof tank is shown in Figure 3-2. This type of tank consists of a 

cylindrical steel shell equipped with a deck or roof that floats on the 

surface of the stored liquid, rising and falling with the liquid level. 

The liquid surface is completely covered by the floating roof except in 

the small annular space between the roof and the shell. A seal attached 

to the roof touches the tank wall (except for small gaps in some cases) 

and covers the remaining area. The seal slides against the tank wall as 

the roof is raised or lowered. 

3.2.1.3 Internal Floating Roof Tanks. An internal floating roof 

tank has both a permanently affixed roof and a roof that floats inside 

the tank on the liquid surface (contact roof), or supported on pontoons 

several inches above the liquid surface (noncontact roof). The internal 

floating roof rises and falls with the liquid level. Typical contact 

and noncontact internal floating roof tanks are shown in Figures 3-3a 

and 3-3b, respectively. 

Contact-type roofs include (1) aluminum sandwich panel roofs with a 

honeycombed aluminum core floating in contact with ~the liquid; (2) resin 

coated, glass fiber reinforced polyester (RFP) buoyant panels, floating 

in contact with the liquid; and (3) pan-type steel .roofs, floating in 

contact with the liquid with or without the aid of pontoons. The majority 

of contact internal floating roofs currently in VOL service are steel-pan 

type or aluminum sandwich panel type. The RFP roofs are less common. 

Several variations of the pan-type contact steel roof exist. The 

design may include bulkheads, or open compartments, around the perimeter 

of the roof to minimize and/or localize the effects of liquid that may 

leak or spill onto the deck. Alternately, the bulkheads may be covered 

to form sealed compartments (i.e., pontoons), or the entire pan may be 

covered to form a sealed double deck steel floating roof. Construction 

is generally welded steel. 

3-6 
, • 

·I: t 

!~"•• 

., ., .. , . ........ r, ' ' .... .. ...._ ' ' .. .. . ·-. ... ..-.-~ 

, 

. 

' ...... . --··-~-~ ,_ ... --. . ... ··-·-

, ,' 

-... -.... ... 

Figure 3-2. External floating roof tank (pontoon type). 

3-7 
M&nt\o1e 

Peripheral Roof Vent 

Pri1111ry Seal 

Manhole 

a. Contact internal floating roof. 

Pontoons 

Tank Support Column with Column Well 

b. Noncontact internal floating roof. 

Figure 3-3. Internal floating roof tanks. 

3-8 
Noncontact-type roofs typically consist of an aluminum deck on an 

aluminum grid framework supported above the liquid surface by tubular 

aluminum pontoons. The deck skin for the noncontact-type floating roofs 

typically is constructed of rolled aluminum sheets (about 1.5 m wide and 

0.58 mm thick). The overlapping aluminum sheets are joined by bolted 

aluminum clamping bars that run perpendicular to the pontoons to improve 

the rigidity of the frame. The deck skin seams can be metal on metal or 

gasketed with a polymeric material. The pontoons and clamping bars form 

the structural frame of the floating roof. The presence of deck seams 

in the noncontact internal floating roof design contributes to emissions 

from the internal floating roof tank. Aluminum sandwich panel contact-type 

internal floating roofs share this design feature. The sandwich panels 

are joined with bolted mechanical fasteners that are similar in concept 

to the noncontact deck skin clamping bars. Steel-pan contact internal 

floating roofs are constructed of welded steel sheets and have no deck 

seams. Similarly, the resin-coated, reinforced fiberglass panel roofs 

have no apparent deck seams. The panels are butted and lapped with 

resin-impregnated fiberglass fabric strips. The significance of deck 

seams to emissions from internal floating roof tanks is addressed in 

Chapter 4. 

It should be recognized that the roof physically occupies a finite 

volume of space that takes away from the maximum liquid storage capacity 

of the tank. When completely full, the floating roof touches or nearly 

touches the fixed roof. Consequently, the effectiv~ height of the tank 

decreases, thus limiting the storage capacity. The reduction in the 

effective height varies from about 1 to 2 feet depending on the type and 

design of the floating roof employed. 

All types of internal floating roofs, like external floating roofs, 

commonly incorporate flexible perimeter seals or wipers that slide 

against the tank wall as the roof moves up and down. These seals are 

discussed in detail in Section 3.2.2.2. Circulation vents and an open 

vent at the top of the fixed roof are generally provided to minimize the 

possibility of hydrocarbon vapors accumulating in concentrations approaching 

the flammable range. 

3-9 
3.2.2 Types of Floating Roof Perimeter Seals 

3.2.2.1 External Floating Roof Seals. Regardless of tank design, 

a floating roof requires a closure device to seal the gap between the 

tank wall and the roof perimeter. A primary seal, the lower seal of a 

two-seal system, can be made from various materials suitable for organic 

liquids service. The basic designs available for primary seals are 

(1) mechanical shoe seals, (2) liquid-filled seals, and (3) (vapor- or 

liquid-mounted) resilient foam log seals. Figure 3-4 depicts these 

three general types of seals. 

One major difference in seal system design is the way in which the 

seal is mounted with respect to the liquid. Figure 3-4c shows a vapor 

space between the liquid surface and seal, whereas, in Figures 3-4a and 

3-4d, the seals are resting on the liquid surface. These liquid-filled 

tube and resilient foam seals are classified as liquid- or vapor-mounted 

seals depending on their location. Mechanical shoe seals are different 

in design from liquid-filled or resilient foam log seals and cannot be 

characterized as liquid- or vapor-mounted. However, because the shoe 

and envelope combination precludes communication between the annular 

vapor space above the liquid and the atmosphere (see Figure 3-4b), the 

performance of a mechanical shoe seal is more like that of a liquid-mounted 

seal than a vapor-mounted seal. 

3.2.2.1.1 Mechanical shoe seal. A mechanical shoe seal, otherwise 

known as a 11metallic shoe seal 11 (Figure 3-4b), is characterized by a 

metallic sheet (the 11 shoe 11 ) 75 to 130 em (30 to 51 in) high held against 

the vertical tank wall. The shoe is connected by braces to the floating 

roof and is held tightly against the wall by springs or weighted levers. 

A flexible, coated fabric (the 11 enve1ope 11 ) is suspended from the shoe 

seal to the floating roof to form a vapor barrier over the annular space 

between the roof and the primary seal. 

3.2.2.1.2 Liquid-filled seal. A liquid-filled seal (Figure 3-4a) 

may be a tough fabric band or envelope filled with a liquid, or it may 

be a flexible polymeric tube 20 em to 25 em (8 inch to 10 inch) in 

diameter filled with a liquid and sheathed with a tough fabric scuff 

band. The liquid is commonly a petroleum distillate or other liquid 

that will not contaminate the stored product if the tube ruptures. 

3-10 
ran /Metallic Weather 

Wall r Shield 

Scuff 

Liquid Filled 

Tube 

a. Liquid-filled seal with weather 

shield. 

Metallic Weather ;f / Shield 

Ta~~ 1 Wall 

Fl oa ti ng Roof 

Seal Fabric 

Resilient Foam 

Vapor Space 

U ... ~ l 

c. Vapor-mounted resilient foamfilled seal with weather shield. 

Tank Wall 

loating Roof 

Vapor Space 

b. t1eta111c shoe seal. 

Metallic Weather 

{ Shield 

Floating Roof 

Seal Fabric 

Resilient Foam 

I 

I 

·-=I 

d. Liauid-mounted resilient foamfilled seal with weather shield. 

Figure 3-4. Primary sea 1 s. 

3-11 
Liquid-filled seals are mounted on the product liquid surface with no 

vapor space below the seal. 

3.2.2.1.3 Resilient foam-filled seal. A resilient foam-filled 

seal is similar to a liquid-filled seal except that a resilient foam log 

is used in place of the liquid. The resiliency of the foam log permits 

the seal to adapt itself to some imperfections in tank dimensions and in 

the tank shell. The foam log may be mounted above the liquid surface 

(vapor-mounted) or on the liquid surface (liquid-mounted). Typical 

vapor-mounted and liquid-mounted seals are presented in Figures 3-4c and 

3-4d, respectively. 

3.2.2.1.4 Secondary seals on external floating roofs. A secondary 

seal on an external floating roof is a continuous seal mounted on the 

rim of the floating roof and extending to the tank wall, covering the 

entire primary seal. Secondary seals are normally constructed of flexible 

polymeric materials and mounted such that they provide a wiping action 

against the tank wall as the roof raises and lowers. Figure 3-5 depicts 

several primary and secondary seal systems. An alternative secondary 

seal design incorporates a steel leaf to bridge the gap between the roof 

and the tank wall. The leaf acts as a compression plate to hold a 

polymeric wiper against the tank wall. 

Installed over a primary seal, a secondary seal provides a barrier 

for VOC emissions that escape from the small vapor space between the 

primary seal and the wall and through any openings or tears in the seal 

envelope of a metallic shoe seal (Figure 3-5). Although not shown in 

Figure 3-5, a secondary seal can be used in conjunction with a weather 

shield as described in the following section. 

Another type of secondary seal is a shoe-mounted secondary seal. A 

shoe-mounted seal extends from the top of the shoe to the tank wall 

(Figure 3-6). These seals do not provide protection against VOC leakage 

through the envelope. Holes, gaps, tears, or other defects in the 

envelope can permit direct communication between the saturated vapor 

under the envelope and the atmosphere. Wind can enter this space through 

envelope defects, flow around the circumference of the tank, and exit 

with saturated or nearly saturated VOC vapors. 

3-12 
IIIHiov•no 

IICOIDUY SIAL 

VAPOR IIACI 

a. Shoe seal with rim-mounted 

seconda rv sea 1. 

TANK 

WWALL 

IIM-MOUNTEC 

( ltCONOUY SlAL 

-· 

fLOATUIG IOOF 

RUILlfNT FOAM LOG 

VAPGai,ACl 

c. Resilient foam seal (vapor- nDunted) with rim-mounted 

secondary seal. 

( a.HIOUITID <OIDUY SlAL 

ILOATINCi ROOF 

UQUID-IJLUD TUI£ 

b. Liquid-filled seal with rimmounted secondary seal. 

d. Resilient foam seal (liquid- mounted} with rim-rounted 

secondary seal. 

Figure 3-5 (a-d). Rim-mounted secondary seals on 

external floating roofs. 3 

3-13 
Figure 3-6. 

TANK 

WALL SECONDARY SEAL 

/ (WIPER TYP£1 

fLOATINii ROOF 

VAPORSPACf 

Metallic 3 shoe seal with shoe-mounted secondary seal. 

3-14 
3.2.2.1.5 Weather shield. A weather shield (Figures 3-4a, 3-4c, 

and 3-4d) may be installed over the primary seal or the primary and 

secondary seals, to protect it, or them, from deterioration caused by 

debris and exposure to the elements. Typically, a weather shield is an 

arrangement of overlapping thin metal sheets pivoted from the floating 

roof to ride against the tank wall. The weather shield, by the nature 

of its design, is not an effective vapor barrier. For this reason, it 

differs from the secondary seal. Although the two devices are conceptually 

similar in design, they are designed for and serve different purposes. 

3.2.2.2 Internal Floating-Roof Tank Seals. Internal floating 

roofs typically incorporate one of two types of flexible, product-resistant 

primary seals: resilient foam-filled seals or wiper seals. Similar to 

those employed on external floating roofs, each of these seals closes 

the annular vapor space between the edge of the floating roof and the 

tank shell. They are designed to compensate for small irregularities in 

the tank shell, and allow the roof to move freely up and down in the 

tank without binding. 

3.2.2.2.1 Resilient foam-filled seal. A resilient foam-filled 

seal used on an internal floating roof is similar in design to that 

described in Section 3.2.2.1.3 for external floating roofs. Two types 

of resilient foam-filled seals for internal floating roofs are shown in 

Figures 3-7a and 3-7b. These seals can either be mounted in contact 

with the liquid surface (liquid-mounted) or several centimeters above 

the liquid surface (vapor-mounted). 

Resilient filled seals work on the principle of expansion and 

contraction of a resilient material to maintain contact with the tank 

shell while accommodating varying annular rim space widths. These seals 

consist of a core of open-cell foam encapsulated in a coated fabric. 

The elasticity of the foam core pushes the fabric into contact with the 

tank shell. The seals are attached to a mounting on the deck perimeter 

and are continuous around the circumference. Urethane coated nylon 

fabric and polyurethane foam are commonly employed materials. For 

emission control, it is important that the mounting and radial seal 

joints be vapor-tight and that the seal be in substantial contact with 

the tank shell. 6 

3-15 
a. Resilient foam-filled seal (vapor-mounted). 

Contact internal floating roof 

aluminum sandwich roof) 

--v, 

Resilient foam-filled seal 

b. Resilient foam-filled seal (liquid-mounted). 

/.Res i1 i ent foam-fi 11 ed sea 1 

~ L Tank wall 

/

Contact internal floating roof (pan~type steel roof) 

c. Elastomeric wiper seal. 

on oon ~ \Metal seal ring Tank wall 

Note: v - vapor 

L - liquid 

Non-contact internal floating roof 

' 

Pontoon! 

Figure 3-7. Typical flotation devices and perimeter seals for 

internal floating roofs. 

3-16 
3.2.2.2.2 Primary wiper seals. Wiper seals are commonly used as 

primary seals for internal floating roof tanks. This type of seal is 

depicted in Figure 3-7c. 

Wiper seals generally consist of a continuous annular blade of 

flexible material fastened to a mounting on the deck perimeter, spanning 

the annular rim space, and contacting the tank shell. The mounting is 

such that the blade is flexed, and its elasticity provides a sealing 

pressure against the tank shell. A vapor space exists between the 

liquid stock and the bottom of the seal; such seals are vapor-mounted. 

For emission control, it is important that the mounting be vapor-tight, 

that the seal be continuous around the circumference, and that the blade 

be in substantial contact with the tank shell. 6 

Two types of wipers are commonly used. One type consists of a 

cellular, elastomeric material tapered in cross section with the thicker 

portion at the mounting. Buna-N rubber is a commonly-used material. 

All radial joints in the blade are joined. 6 

A second type of wiper seal construction uses a foam core wrapped 

with a coated fabric. Urethane on nylon fabric and polyurethane foam 

are common materials. The core provides the flexibility and support 

while the fabric provides the vapor barrier and wear surface. 6 

A third type of wiper seal consists of overlapping segments of seal 

material (shingle-type seal). Single-type seals differ from the wiper 

seals discussed previously in that they do not provide a continuous 

vapor barrier. 

3.2.2.2.3 Secondary seals for internal floating roof tanks. 

Secondary seals may be used to provide some additional evaporative loss 

control over that achieved by the primary seal. The secondary seal 

would be mounted to an extended vertical rim plate, above the primary 

seal, as shown in Figure 3-8. Secondary seals can be either an elastomeric 

wiper seal or a resilient foam-filled seal as described in Sections 3.2.2.2.2 

and 3.2.2.2.1, respectively. For a given roof design, the use of a 

secondary seal further limits the operating capacity of a tank due to 

the need to avoid interference of the seal with the fixed roof rafters 

when the tank is filled. Currently, secondary seals are not commonly 

used on internal floating roof tanks6. 

3-17 
SECONDARY SEAL 

·CONTACT TYPE 

INTERtlAl. FLOATING ROOF 

~-------o~----

Figure 3-8. Rim mounting of a secondary seal on internal floating roof. 8 

3-18 
3.2.3 Types of Internal Floating Roof Deck Fittings 

The majority of Section 3.2.3 largely is from a draft American 

Petroleum Institute publication6 that is expected to be published in 

June, 1983. 

There are numerous fittings that penetrate or are attached to an 

internal floating roof. These fittings serve to accommodate structural 

support members or to allow for operational functions. 6 A cross section 

of an internal floating roof tank showing typical fittings is depicted 

in Figure 3-9. 7 The fittings can be a source of evaporative loss, in 

that, they require penetrations in the deck. Other accessories are used 

that do not penetrate the deck and are not, therefore, sources of 

evaporative loss. The most common fittings with relevance to controllable 

vapor losses are described in the following sections. 6 

3.2.3.1 Access Hatches. An access hatch consists of an opening in 

the deck with a peripheral vertical well attached to the deck and a 

removable cover to close the opening. An access hatch is sized to 

provide for passage of workers and materials through the deck for 

construction or servicing. The cover can rest directly on the well, or 

a gasketed connection can be used to reduce evaporative loss. Bolting 

the cover to the well provides further loss reduction. With noncontact 

decks, the well should extend down into the liquid stock to seal off the 

vapor space below the deck. 6 Figure 3-lOa depicts_an access hatch that 

is suitable for use on a steel contact internal floating roof. 

3.2.3.2 Column Wells .. The most common fixed roof designs are 

normally supported from inside the tank by means of vertical columns, 

which necessarily penetrate the floating deck. (Some fixed roofs are 

entirely self-supporting and, therefore, have no support columns.) 

Columns are made of pipe with circular cross sections or of structural 

shapes with irregular cross sections. The number of columns varies with 

tank diameter, from a minimum of one to over 50 for very large tanks. 6 

Figure 3-10b depicts a column well for a built-up column. 

The columns pass through deck openings with peripheral vertical 

wells. With noncontact decks, the well should extend down into the 

liquid stock. Generally, a closure device exists between the top of the 

well and the column. Several proprietary designs exist for this closure, 

3-19 
w 

I 

N 

0 

~ 124> 

\~ 11 

•4 

~ 

1'> 5 

2 

I Rfl ALl.t.l P(»jT. If C 

TYPICAL INTERNAL FLOATING COVER TANK CROSS SECTION ·~ CIICUMflRENTIAL TAN< St£LL TO IN llRNAL Fl.Oo\TER ~CENTER ROOF VENT WITH REMOVABLE LID TO 

TAN< BOTTOM 

TAN< St£l..l 

TAN<~ 

TAN< ~SUPPORT CO..lMNISl 

T- FU. NOZZlf 

{1) OPTIONAL T .t.NI< Fa.L LN OlffVSEII 

rg, OPnJNAL FOot.M CHAMI![RISl&OHlECTQfllSl 

{!_ OPTIONAl VUITlCAl INTfRNAl •ADO£ R & TANII 

ROOf HATCH 

f'~ Lf>TIQNAL GAUGE WELL 

li i · OPTIONAl CAIJC( HATCH i§! 0PTIQHA4. LA()[)(R SAfETY CL.-.G Of VICE 

(~OPTIONAL HANOfiAl. AT PERIPHERY ROOf VENTS 

~! OP IlONA!.. GAlJG( fUH:l 

(!;OPTIONAl OR EJUSTING TAN< CAUCf 

Figure 3-9. 

AIM SEAL N#J FOAM DAM IPATENT PENOINGJ SERVE AS A VENTILATOfl NOZZLE 

@TANK ROOF SUPPORT COlUMN ISOLATION WEUISl ~) SHEll VENT AND OVERFLOW COMBINATION 

AH..l SfALISl I""' TENT PENDING> ,~ ELECTRICAL GAOUNDING CAilLES 

1~ VERTICAL LA[)[)(,R ISOLATION WEll AND SEAL 1-rf; IF C ROTATION PAE VENT ION ASSEMBLY 

!PATENT PENDING I ii) IICCESS MANWA.Y THACIUGH IF C. INOT SHOWNJ 

(~ FWTATION PONTOONS ?9) STORED PfiOOUCT 

21Ji IWO POSITION SUPPORT LEGS FOR LF C WHfN ·~OTHER OPTIONS NOT SHOWN FOR CLARITY. 

l ANOfO ON I ANI< 110 I IOM PLEASE CONSULT OLfl STAff OF V 0 C EMISSION 

711 PRESSURE AND VIICWM REllff OfVICEISI fOil CON TROt. PAOfESSIONALS IN YOUR REGION 

I r C WHEN LANOfO ON lANK BOTTOM 

~ 1AM< CAUCEISOt.AIION WELL FLOAT CUI()( AND 

SEAL 

':!} PERIPHEHV AIR SCOOP IIIXJr VENT HINGED FOR 

INSPI:CliON ACCESS AND DlSIGI<oEO TO .ICCOM 

MOOAIE A PORTABLE fOAM TOWER 

Typical internal floating roof tank cross section. 7 

II il 

'I 

·: 

~ 
w 

I 

N 

...... 

lOP GIRDER 

SECTION ®:.® 

lq 

lp 

'•' '•l '" Ill 

a. Access hatch9 

DICK .. IT 

-

b. Column well for built-up column 7 

G)-TOOH 

ct IUI'POIIT 1.10 Air« 

CIDECK~ 

@I-lEAL 

• TANK IIOfTOM 

SPIIOOUCT 

:.:::.-::.~-::. ~= 

c. Roof leg assembly7 

Figure 3-10. Internal floating roof deck fittings. 
w 

I 

N 

N 

BOLTIMe FLAMOII 

TOP AND BOTTOM 

CURVATURE OF FLARED FITTIMeS 

PRECLUDES THE POIIIIILITY OF 

lAMPL! BOTTLES BNAIOIMQ OR 

CAfCMIMO OM THE SAMPLE WlLLo 

tO• (!~ MM) DIAo PIPI DIAPMRAM WITH 8 RADIAL 

ILITI FOR BAMPLIMI OR 

IAIIMI 

d. 

10 Sample well assembly 

DECK IHIET 

UG GUIDE AIIEMILY 

LEG ILUYE AIIEMILY 

fLOAT ITOP 

DECK IH£El 

===t 

fLOAT WELL 

') II EXISTING GAUGE TAPE AND flOAT 

f. Automatic gauge float well assembly

7 

e. Pressure/vacuum breaker assembly

7 

Internal floating roof deck fittings (Continued). Figure 3-10. 
including sliding covers and fabric sleeves, which must accommodate the 

movements of the deck relative to the column as the liquid levels change. 6 

A sliding cover rests on the upper rim of the column well (which is 

normally fixed to the roof) and bridges the gap or space between the 

column well and the column. The cover, which has a cutout or opening 

around the column, slides in a vertical direction relative to the column 

as the roof raises and lowers. At the same time, the cover slides in a 

horizontal direction relative to the rim of the well, which is fixed to 

the roof. A gasket around the rim of the well reduces emissions from 

this fitting. A flexible fabric sleeve seal between the rim of the well 

and the column (with a cutout or opening to allow vertical motion of the 

seal relative to the columns) similarly accommodates limited horizontal 

motion of the roof relative to the column. A third design, which is 

proprietary, is depicted in Figure 3-lOb. This design, in effect, 

combines the advantages of the flexible fabric sleeve seal with a well 

that excludes all but a small portion of the liquid surface from direct 

communication with the vapor space above the floating roof. 

3.2.3.3 Roof Legs or Hanger Wells. To prevent damage to fittings 

underneath the deck and to allow for tank cleaning or repair, supports 

are provided to hold the deck a pre-determined distance off the tank 

bottom. These supports consist of adjustable or fixed legs attached to 

the floating deck or hangers suspended from the fixed roof. For adjustable 

legs or hangers, the load-carrying element passes through a well or 

sleeve in the deck. 

the liquid stock. 6 

With noncontact decks, the well should extend into 

Figure 3-lOc depicts a roof leg assembly. 

3.2.3.4 Sample Pipes or Wells. A sample well may be provided to 

allow for sampling of the liquid stock. Typically, the well is funnelshaped to allow for easy entry of a sample thief. A closure is provided, 

which is typically located at the lower end of the funnel and which 

frequently consists 

allow thief entry. 

6 noncontact decks. 

of a horizontal piece of fabric slit radially to 

The well should extend into the liquid stock on 

Figure 3-lOd depicts a sample well assembly. 

Alternately, a sample well may consist of a slotted pipe extending 

into the liquid stock, equipped with an ungasketed or gasketed sliding 6 . cover. 

3-23 
3.2.3.5 Vacuum Breakers. When the internal floating deck is 

either being landed on its legs or floated off its legs, a vacuum breaker 

is used to equalize the pressure of the vapor space across the deck. 

This is accomplished by opening a deck penetration that usually consists 

of a well formed of pipe or framing on which rests a cover. To the 

underside of the cover is attached a guided leg of such length that it 

contacts the tank bottom as the internal floating deck approaches the 

tank bottom. When in contact with the tank bottom, the guided leg 

mechanically opens the breaker by lifting the cover off the well. When 

the leg is not contacting the bottom, the penetration is closed by the 

cover resting on the well. The closure may be with or without a gasket 

between the cover and neck. Since the purpose of the vacuum breaker is 

to allow the free exchange of air and/or vapor, the well does not extend 

appreciably below the deck. 6 Figure 3-lOe depicts a pressure vacuum 

assembly. The gasket on the underside of the cover, or conversely on 

the upper rim of the well, provides a small measure of emission control 

(~20 percent emissions reduction) during periods when the roof is free 

floating and the breaker is closed. 

3.2.3.6 Automatic Gauge Float Wells. Gauge floats are used to 

indicate the level of stock within the tank. They usually consist of a 

float residing within a well that passes through the floating deck. The 

float is connected to an indicator on the exterior of the tank via a 

tape passing through a guide system on the fixed roof. The float rests 

on the stock surface within the well. The well is closed by a cover 

that rests on the well. Evaporation loss can be reduced by gasketing 

and/or bolting the connection between the cover and the rim of the well. 

The cable passes through a bushing located at the center of the cover. 

As with other similar deck penetrations, the well extends into the 

liquid stock on noncontact floating decks. 6 Figure 3-lOf depicts a 

bolted automatic gauge float well assembly. 

3.2.3.7 Ladder Wells. Some tanks are equipped with internal 

ladders that extend from a manhole in the fixed roof to the tank bottom. 

The deck opening through which the ladder passes is constructed with 

similar design details and considerations as those for column wells, as 

discussed in Section 3.2.3.2. 6 

3-24 
3.2.4 Storage Tank Emissions and Emission Equations 

3.2.4.1 Fixed-Roof Tank Emissions. The major types of emissions 

from fixed-roof tanks are breathing and working losses. Breathing loss 

is the expulsion of vapor from a tank vapor space that has expanded or 

contracted because of daily changes in temperature and barometric pressure. 

The emissions occur in the absence of any liquid level change in the 

tank. 

Filling losses are associated with an increase of the liquid level 

in the tank. The vapors are expelled from the tank when the pressure 

inside the tank exceeds the relief pressure as a result of filling. 

Emptying losses occur when the air that is drawn into the tank during 

liquid removal saturates with hydrocarbon vapor and expands, thus exceeding 

the fixed capacity of the vapor space and overflowing through the pressure 

vacuum valve. Combined filling and emptying losses are called 11working 

losses. 11 

Emission equations for breathing and working losses were developed 

for EPA Publication No. AP-42. 11 The equations used in estimating 

emissions rates for fixed roof tanks storing VOL are: 

LT = LB + LW (3-1) 

LB = 1.02 X 10- 5 M ( p )

0·68 D1 • 73H0 • 51T0 • 5 F CK (3-2) 

v 14.7-P P c 

where, LT = total loss (Mg/yr) 

L

8 = breathing loss (Mg/yr) 

Lw = working loss (Mg/yr) 

M =molecular weight of product vapor (lb/lb mole); 80 assumed 

v as a typical value for VOL liquids 

P = true vapor pressure of product (psia) 

D = tank diameter (ft) 

H = average vapor space height (ft): use tank specific values 

or an assumed value of one-half the tank height 

T = average diurnal temperature change in °F; 20°F assumed as 

a typical value 

3-25 
Fp =paint factor (dimensionless); 1.0 for clean white paint 

C = tank diameter factor (dimensionless): 

for diameter ~ 30 feet, C = 1 

for diameter < 30 feet, 

c = 0.0771 0 - 0.0013(02 ) - 0.1334 

K =product factor (dimensionless)= 1.0 for VOL 

c 

V =tank capacity (gal) 

N = number of turnovers per year (dimensionless) 

Kn = turnover factor (dimensionless): 

f t 36 K = 180 + N or urnovers > , n 6N 

for turnovers ~ 36, Kn = 1 

3.2.4.2 External Floating-Roof Tank Emissions. Standing-storage 

losses, which result from causes other than a change in the liquid 

level, constitute the major source of emissions from external floating 

roof tanks. The largest potential source of these losses is an improper 

fit between the seal and the tank shell (seal losses). As a result, 

some liquid surface is exposed to the atmosphere. Air flowing over the 

tank creates pressure differentials around the floating roof. Air flows 

into the annular vapor space on the leeward side and an air-vapor mixture 

flows out on the windward side. 

Withdrawal loss is another source of emissions from floating roof 

tanks. When liquid is withdrawn from a tank, the floating roof is 

lowered, and a wet portion of the tank wall is exposed. Withdrawal loss 

is the vaporization of liquid from the wet tank wall. 

VOL emissions from external floating roof tanks are estimated using 

equations based on a pilot tank study conducted for the EPA by the 

Chicago Bridge and Iron Company. 8 Appendix C describes the development 

of the emission equations and the associated emission factors. 

From the equations presented below, it is possible to estimate the 

total evaporation loss for external floating roof tanks, LT, which is 

the sum of the withdrawal loss, Lw• and the external floating roof seal 

loss, LsE· These equations in large part are extracted from AP-42. 11 

However, minor changes have been made to update the equations. (Note: 

external floating roof tanks have no appreciable losses from fittings.) 

3-26 
LT = lw + LSE (3-4) 

Lw = 4.28 X 10-4 QCWL/D (3-5) 

LSE = K5VNP*DMv Kc/2205 (3-6) 

where, LT = total loss (Mg/yr) 

Lw = withdrawal loss (Mg/yr) 

LSE = seal loss from external floating roof tanks (Mg/yr) 

4 =product average throughput (bbl/yr); 

tank capacity (bbl/turnover) x turnovers/yr 

C =product withdrawal shell clingage factor (bbl/103 ft2); use 

0.0015 bbl/103 ft2 for VOL in a welded steel tank with 

light rust (0.0075 for dense rust) 

WL =density of product (lb/gal); 7.4 to 8.0 lb/gal assumed as 

typical range for VOL liquids 

D = tank diameter (ft) 

K5 = seal factor: obtain from Table 3-4 

V =average windspeed for the tank site (mph); 

10 mph assumed average windspeed 

N = seal windspeed exponent (dimensionless): obtain from 

Table 3-4 

P* =the vapor pressure function (dimensionless); 

P* = 0.068P/((1 + (1- 0.068P)o·s)2) 

P = the true vapor pressure of the materials stored (psia) 

Mv = molecular weight of product vapor (lb/lbmole) 

Kc =product factor (dimensionless)= 1.0 for VOL 

3.2.4.3 Internal Floating Roof Tank Emissions. As ambient wind 

flows over the exterior of an internal floating roof tank, air flows 

into the enclosed space between the fixed and floating roofs through 

some of the shell vents and out of the enclosed space through others. 

Any VOC vapors that have evaporated from exposed liquid surface and that 

have not been contained by the floating deck will be swept out of the 

enclosed space. 

Losses of VOC vapors from under the floating roof occur in one of 

four ways: 

(1) through the annular rim space around the perimeter of the 

floating roof (rim or seal losses); 

(2) through the openings in the deck required for various types of 

fittings (fitting losses); 

3-27 
Table 3-4. SEAL RELATED FACTORS FOR 

EXTERNAL FLOATING ROOF TANKSa 

Seal type 

Metallic shoe seal 

Primary seal only 

With shoe mounted secondary seal 

With rim mounted secondary seal 

Liquid mounted resilient seal 

Primary seal only 

With weather shield 

With rim mounted secondary seal 

Vapor mounted resilient seal 

Primary seal only 

With weather shield 

With rim mounted secondary seal 

1.2 

0.8 

0.2 

1.1 

0.8 

0.7 

1.2 

0.9 

0.2 

1.5 

1.2 

1.0 

1.0 

0.9 

0.4 

2.3 

2.2 

2.6 

aBased on emissions from tank seal system with emissions 

control devices (roof, seals, etc.) in reasonably good 

working condition, no visible holes, tears or unusually 

large gaps between the seals and the tank wall. 

bKS = seal factor in Equation 3-6. 

eN= seal windspeed exponent (dimensionless) in 

Equation 3-6. 

3-28 
(3) through the nonwelded seams formed when joining sections of 

the deck material (deck seam losses); and 

(4) through evaporation of liquid left on the tank wall following 

withdrawal of liquid from the tank (withdrawal loss). 

The withdrawal loss from an internal floating roof tank is similar to 

that discussed in the previous section for external floating roofs. The 

other losses, seal losses, fitting losses and deck seam losses, occur 

not only during the working operations of the tank but also during free 

standing periods. The mechanisms and loss rates of internal floating 

roof tanks was studied in detail by the Chicago Bridge and Iron Company 

for the American Petroleum Institute. 6 The results of this work form 

the basis for internal floating roof emissions discussion. 

Several potential mechanisms for vapor loss from the rim seal area 

of an internal floating roof tank can be postulated: 

• circumferential vapor movement underneath vapor-mounted rim 

seals; 

• vertical mixing, due to diffusion or air turbulence, of the 

vapor in gaps that may exist between any type of rim seal and 

the tank shell; 

• expansion of vapor spaces in the rim area due to temperature 

or pressure changes; 

• varying solubility of gases, such as air, in the rim space 

liquid due to temperature and pressure changes; 

• wicking of the rim space liquid up the tank shell; and 

• vapor permeation through the sealing material. 

For external floating roof tanks, wind-generated air movement across the 

roof is the dominant factor affecting rim seal loss. In comparison, for 

freely-vented internal floating roof tanks, in which the air movement is 

significantly reduced, no clearly dominant loss mechanism can be discerned. 6 

Vapor permeability is the only potential rim seal area loss mechanism 

that is readily amenable to independent investigation. Seal fabrics are 

generally reported to have very low permeability to typical hydrocarbon 

vapors, such that this source of loss is not considered to be significant. 

However, if a seal material is used that is highly permeable to the 

3-29 
vapor from the stored stock, the rim seal loss could be significantly 

higher than that estimated from the rim seal loss equation presented 

later in this section. 6 Particularly when dealing with VOL rather than 

petroleum liquids, attention must be paid to the properties of the 

individual compounds being stored. For instance, benzene is suspected 

of having permeability losses that equal or exceed convective and diffusion 

losses from the seal. 13 Additional permeability data for VOL/seal 

material combinations must be developed to fully characterize the 

significance of permeability losses. Permeability is discussed in more 

detail in Appendix C. 

The extent to which any or all of these mechanisms contributes to 

the total fitting loss is not known. The relative importance of the 

various mechanisms probably depends on the type of fitting, the design 

of the fitting seal, and whether or not the deck is in contact with the 

stored liquid. 6 

Floating decks are typically made by joining several sections of 

deck material together, resulting in seams in the deck. To the extent 

that these seams are not completely vapor tight, they become a source of 

loss. Generally the same loss mechanisms discussed for deck fittings 

may apply to deck seams. 6 

Emissions from internal floating roof tanks can be estimated from 

the following equations6 (Note that these equations apply only to 

freely vented internal floating roof tanks.) 

where: 

LT = Lw + Lr + Lf + Ld (3-7) 

L = the total loss (Mg/yr) T N F 

L = (0.943) Q c wl [1 + C _£___o c )J/2205 

w D 

where D = tank diameter (ft) 

Nc = number of columns (dimensionless) 

Fe= effective column diameter (ft); 1.0 assumed 

Lr = the 

Lf = the 

* rim seal loss (Mg/yr) = (KrD) P Mv Kc/2205 

* fitting loss (Mg/yr) = (Ff) P Mv Kc/2205 

Ld =the deck * seam loss (Mg/yr) = (Fd Kd 02 ) P Mv Kc/2205 

3-30 
K = the rim seal loss factor (lb mole/ft yr) that for an 

r average fitting seal is as follows: 

Seal system description 

Vapor-mounted primary seal only 

Liquid-mounted primary seal only 

Vapor-mounted primary seal plus 

Kr (lb mole/ft yr) 

6.7 

3.0 

secondary seal 2.5 

1.6 

Liquid-mounted primary seal plus 

secondary seal 

0 = the tank diameter (ft) 

P * = the vapor pressure function (dimensionless) 

P * = 0.068 P/((1 + (1- 0.068 P)o·s)2) 

P = the true vapor pressure of the material stored (psia) 

Mv = the average molecular weight of the product vapor 

(lb/lbmole). A typical value for VOL liquids is 

80 lb/lbmole. 

Kc =the product factor (dimensionless) = 1.0 for VOL 

2205 = constant (lb/Mg) 

Ff =the total deck fitting loss factor (lbmole/yr) 

n 

= l (N Kf_) = . 1 f. 1= 1 1 

where: 

Nf.= 

1 

number of fittings of a particular type 

(dimensionless). Nf. is determined for the 

1 

specific tank or estimated from Tables 3-5 

and 3-6 

deck fitting loss factor for a particular type 

fitting (lbmole/yr). Kf. is determined for each 

1 

fitting type from Table 3-6 

n = number of different types of fittings (dimensionless) 

3-31 
Table 3-5. TYPICAL NUMBER OF COLUMNS AS A 

FUNCTION OF TANK DIAMETERS6 

Tank diameter range 

D (ft) 

0 < D < 85 

85 < D < 100 

100 < D < 120 

120 < D < 135 

135 < D < 150 

150 < D < 170 

170 < D < 190 

190 < D < 220 

220 < D ( 235 

235 < D < 270 

270 < D < 275 

275 < D < 290 

290 < D < 330 

330 < D < 360 

360 < D < 400 

Typical number 

columns, Nc 

1 

6 

7 

8 

9 

16 

19 

22 

31 

37 

43 

49 

61 

71 

81 

Note: This table was derived from a survey of 

users and manufacturers. The actual number of 

columns in a particular tank may vary greatly 

depending on age, roof style, loading specifications, and manufacturing perogatives. This 

table should not supersede information based 

on actual tank data. 

3-32 
Table 3-6. SUMMARY OF DECK FITTING LOSS FACTORS (Kf) AND 

TYPICAL NUMBER OF FITTINGS (Nf) 6 

Deck fitting type 

1. Access Hatch 

a. Bolted cover, gasketed 

b. Unbolted cover, gasketed 

c. Unbolted cover, ungasketed 

2. Automatic Gauge Float Well 

a. Bolted cover, gasketed 

b. Unbolted cover, gasketed 

c. Unbolted cover, ungasketed 

3. Co 1 umn We 11 

a. Built-up column-sliding cover, 

gasketed 

b. Built-up column-sliding cover, 

ungasketed 

c. Pipe column-flexible fabric 

sleeve seal 

d. Pipe column-sliding cover, 

gasketed 

e. Pipe column-sliding cover, 

ungasketed 

4. Ladder We 11 

a. Sliding cover, gasketed 

b. Sliding cover, ungasketed 

5. Roof Leg or Hanger Well 

a. Adjustable 

b. Fixed 

6. Sample Pipe or Well 

a. Slotted pipe-sliding cover, 

gasketed 

b. Slotted pipe-sliding cover, 

ungasketed 

c. Sample well-slit fabric seal, 

10% open area 

7. Stub Drain*, l-inch diameter 

8. Vacuum Breaker 

a. Weighted mechanical actuation, 

gasketed 

b. Weighted mechanical actuation, 

ungasketed 

Deck fitting loss 

factor, K 

(lbmole/yt) 

1.6 

11 

25 

5.1 

15 

28 

33 

47 

10 

19 

32 

56 

76 

7.9 

0 

44 

57 

12 

1.2 

0. 7 

0.9 

* Not used on welded, contact internal floating decks. 

** D = tank diameter (ft). 

3-33 

Typical number 

of fittings, 

(Nf) 

1 

1 

(see Table 3-5) 

1 

D 02 ** 

(5 + 10 + 600) 

1 
Fd =the deck seam length factor (ft/ft2 ) 

= 0.~5, for a deck constructed from continuous metal sheets 

with a 7 ft spacing between seams 

= 0.33, for a deck constructed from rectangular panels 5 ft 

by 7.5 ft 

= 0.20, an approximate value for use when no construction 

details are known 

Kd = the deck seam loss factor (lbmole/ft yr) 

= 0.34 for non-welded roofs 

= 0 for welded decks 

3.3 BASELINE CONTROL AND EMISSIONS ESTIMATES 

The baseline control level is set by state regulations that affect 

VOL storage vessels. The control requirements are set forth in the 

State implementation plans (SIP). A typical SIP requires tanks with 

capacities greater than 40,000 gallons (~150 m3 ) storing material with 

vapor pressures greater than 1.5 psia (~10.5 kPa), but less than 11 psia 

(~76.6 kPa), to have a floating roof. For this group of tanks, baseline 

control is assumed to be the noncontact internal floating roof with a 

vapor-mounted primary seal, because it is the least costly means of 

complying with the SIPs. A typical SIP requires tanks with capacities 

greater than 40,000 gallons (~150 m3 ) storing liquids with vapor pressures 

greater than 11 psia (~76.6 kPa) to either have vapor recovery systems 

or to be constructed as high pressure vessels. Therefore, vapor recovery 

is assumed to be the baseline control for this group of tanks. 

Texas contains an estimated 35 percent of the total national VOL 

tank population and has an atypical SIP. Texas requires tanks with 

capacities greater than 25,000 gallons (~95 m3 ) storing VOL with a vapor 

pressure greater than 0.5 psia (~3.5 kPa) but less than 11 psia (~76.6 kPa) 

3-34 
to have a floating roof. Tanks with capacities greater than 25,000 gallons 

(~95 m3) storing VOL with vapor pressures greater than 11 psia (276 kPa) 

must have a vapor recovery system. Texas contains such a significant 

portion of the tank population that this difference in cutoff size must 

be considered in the baseline control level. Therefore, in addition to 

the floating roofs in all tanks with capacities greater than 40,000 gallons 

(~150 m3) and storing VOL with vapor pressures between 1.5 and 11 psia 

(~10.5 and 76.6 kPa), it is assumed that 35 percent of the tanks with 

capacities between 25,000 gallons and 40,000 gallons (~95 m3 to 150 m3) 

storing VOL with vapor pressures between 0.5 psia and 11.5 psia (~3.5 to 

76 kPa) will be constructed with noncontact internal floating roofs with 

vapor-mounted primary seals in the absence of a standard of performance. 

It is further assumed that 35 percent of the tanks that have capacities 

between 25,000 gallons and 40,000 gallons (~95 m3 and 150m3) storing 

VOL with vapor pressures greater than 11 psia (~76.6 kPa), will be 

constructed with vapor recovery systems or stored in pressure vessels. 

This is in addition to the vapor recovery systems or pressure vessels 

for all tanks greater than 40,000 gallons (~150m ) and storing VOL with 

vapor pressures exceeding 11 psia (76.6 kPa). 

The remaining 65 percent of the tanks that have capacities between 

25,000 gallons (~95m ) and 40,000 gallons (~150 m3) and storing materials 

with vapor pressures between 0.5 and 1.5 psia (~3.5 and 10.5 kPa) are 

assumed to be uncontrolled, fixed-roof tanks. It is assumed that every 

tank smaller than 25,000 gallons (~95 m3) and every tank storing material 

with a vapor pressure less than 0.5 psia (~3.5 kPa) will be constructed 

as an uncontrolled, fixed-roof tank. Figure 3-11 summarizes the baseline 

control assumptions. 

The total VOC emission rate from VOL storage vessels is estimated 

to be 37,800 Mg/yr based on the 1977 tank population described in 

Section 3.1 and the baseline control levels. This estimate assumes that 

currently existing or developing state regulations are fully implemented 

on the 1977 tank population. Included in this emissions total are an 

estimated 34,000 Mg/yr of VOC emitted from fixed roof tanks and an 

estimated 3,800 Mg/yr of VOC from floating roof tanks. The 37,800 Mg/yr 

emissions total is broken down among the three vapor-pressure/tank-size 

3-35 
w 

I 

w 

0) 

Ill 

a. 

...... 

ex: 

=> 

V) 

V) 

...... 

ex: 

a.. 

ex: 

0 

a.. 

;; 1.0 I No controls required 

0.5 

- baseline is assumed 

to be fixed-roof tanks 

Texas requires vapor 

control or pressure vessels - baseline is assumed to 

be 35% vapor control systems 

or pressure vessels, 65% 

fixed-roo'f tanks 

Typical SIPs require vapor 

control or pressure vessels - baseline is assumed to 

be vapor control or pressure 

vessels ------------·---------------

Texas requires controls - baseline is assumed 

to be 35% noncontact 

internal floating-roof 

tanks, 65% fixed-roof 

tanks 

Typical SIPs require controls 

-baseline is assumed to be 

100% noncontact internal 

floating-roof tanks 

o~-----L------~----~------~------~-------------------- 20 25 30 35 40 

TANK VOLUME (103 gallons) 

Figure 3-11. Baseline control summary. 
regions that comprise the baseline control level scenario in Figure 3-12. 

Note that the number of tanks storing liquids with vapor pressures 

greater than 58.7 kPa (8.5 psia) is less than 1 percent of the tank 

population. These tanks have very littl~ effect on the estimated number 

of tanks and emissions listed in Figure 3-12. 

3-37 
--.. 

a. 

.... 

ac: 

., 

~ 

., 

.... 

ac: 

A. 

ac: 

0 

A. 

c( 

> 

11,0 

1.0 

Number of tanks 

Fixed roof 1,871 

Floating roof 1.007 

Total 2,878 

Emissions 

-~ 

13,100 

__§QQ 

13,900 

TANK VOLUME (103 gallons) 

Emissions 

Number of tanks (!1!9/yr) 

Fixed roof 0 0 

Floating roof 2,786 3,000 

Total 2,786 3,000 

Figure 3-12. Baseline emissions totals (mg/yr; 1977 tank population) 

and numbers of tanks by vapor pressure/tank size region. 

3-38 
3.4 REFERENCES 

1. Erickson, D. G. Emission Control Options for the Synthetic Organic 

Manufacturing Industry; (Unpublished draft submitted in fulfillment 

of EPA Contract No. 68-02-2577). Hydroscience, Inc. Knoxville, 

Tennessee. October 1978. 97 p. 

2. Radian, Inc. The Revised Organic Chemical Producers Data Base 

System, Final Interim Report; (Submitted in fulfillment of EPA 

Contract No. 68-03-2623.) Austin, Texas. March 1979. 

3. Booz, Allen, and Hamilton, Foster D. 

Hydrocarbon Emissions Control to the 

Manufacturing Chemists Association. 

December 1977. 

Snell Division. Cost of 

U.S. Chemical Industry (SIC 28). 

Florham Park, New Jersey. 

4. Memorandum from Rockstroh, M. A., TRW to Moody, W. T., TRW. 

February 1, 1980. 

5. International Liquid Terminals Association. Bulk Liquid Terminals 

and Storage Facilities, 1979 Directory. Washington, D.C. 1979. 

85 p. 

6. The American Petroleum Institute (API) Draft Document, Evaporation 

Loss from Internal Floating Roof Tanks. API Publication 2519. 

Third Edition. 1982. 

7. RFI Services Corporation. The Woodlands, Texas. Figures extracted 

from promotional literature with the permission of the company. 

8. U.S. Environmental Protection Agency. Measurements of Benzene 

Emissions from a Floating-Roof Test Tank. Report No. EPA-450/3-79-020. 

Research Triangle Park, North Carolina. June 1979. 

9. Brown Boiler and Tank Works, Ltd. Franklin, Pennsylvania. Figure 

extracted from promotional literature with the permission of the 

company. 

10. Ultraflote Corporation. Houston, Texas. Figure extracted from 

promotional literature with the permission of the company. 

11. U.S. Environmental Protection Agency. Compilation of Air Pollution 

Emission Factors. Report No. AP-42; Supplement 12, Research Triangle 

Park, North Carolina. April 1981. 

12. TRW Environmental Division, Background Documentation for Storage of 

Organic Liquids. EPA Contract No. 68-02-3174. Research Triangle 

Park, N.C. May 1981. 

13. U.S. Environmental Protection Agency, Draft Volume II Background 

Information Document for Benzene Storage Hazardous Air Pollutant 

Standards, EPA 450/ , January 1983. 

3-39 
4. CONTROL TECHNIQUES 

This section describes the control techniques applicable to emissions 

of volatile organic compounds (VOC) from the storage of volatile organic 

liquids (VOL). It should be recognized that the emission sources in 

this industry are 11 un-traditional 11 in the sense that they do not have 

exhaust streams that normally are controlled by add-on control devices. 

Consequently, the evaluation of control techniques is not a straight-forward 

process of identification, testing and direct comparison of a series of 

add-on devices. Rather, it is the comparison of alternative tank types 

and equipment options that can be selected for use in storing VOL. 

4.1 OVERVIEW 

As discussed in Chapter 3, there are three major types of vessels 

used to store VOL: fixed roof tanks, internal floating roof tanks, and 

external floating roof tanks. In addition, optional equipment designs 

exist within each major tank type (e.g. seal design, roof fabrication 

fittings closure). Each tank type and equipment option has its own 

associated emissions rate. In effect, there is a spectrum of equipment 

options, with a corresponding spectrum of emission rates. The control 

techniques to be evaluated are these alternative storage vessel equipment 

types. 

The major equipment options that affect emissions from the storage 

of VOL include: 

1 the tank type: fixed roof, internal floating roof, or external 

floating roof; 

1 the floating roof deck type: welded or bolted (pertinent to 

internal floating roof tanks only); 
1 the floating roof primary seal location: liquid- or vapor-mounted 

(pertinent to internal and external floating roof tanks); 

• the types of deck fittings: controlled or uncontrolled (pertinent 

to internal floating roof tanks only); 

1 the floating roof seal system: primary seals only or primary 

and secondary seals (pertinent to internal and external floating 

roof tanks); and 

1 the use of add-on vapor control techniques: incinerators, 

adsorbers, or refrigerated condensers (pertinent to fixed roof 

tanks only). 

Considering the optional types of equipment that can be used to 

store VOL, a hierarchy of equipment alternatives can be developed based 

on emission rate. This hierarchy, in order of decreasing emission 

rates, is listed in Table 4-1. The types of storage vessel equipment 

listed in Table 4-1 are described in detail in Chapter 3. Chapter 3 

also outlines equations for estimating the emission rate for each of the 

major tank types and the equipment options that are available. These 

equations and the test data used to develop the equations (discussed in 

Appendix C) form the basis for evaluating the effectiveness of the 

control techniques discussed in this chapter. 

The hierarchy of equipment options presented in Table 4-1 suggests 

that the emission rate of each control option relative to the others 

remains constant over all situations that may be found in the VOL storage 

industry. This is the case among the internal floating roof tanks, 

fixed roof tanks, and external floating roof tanks with liquid-mounted 

primary and secondary seals (Options 1, 3-7, and 9 in Table 4-1). For 

the most part, the relationship also holds true over the range of conditions 

(e.g. vapor pressure, number of turnovers, etc.) commonly found in the 

industry for the vapor recovery or control and for the external floating 

roof tank, vapor-mounted primary and secondary seal (Options 2 and 8 in 

Table 4-1). The ranking of these two options, however, does vary with 

the tank size and the vapor pressure of the material stored. To illustrate 

the relative emission rates of the equipment options, the total emission 

rates for each option for a range of tank sizes (100 to 10,000 m2 ) has 

4-2 
Table 4-1. HIERARCHY OF EQUIPMENT TYPES BASED ON EMISSIONS RATEa 

Control 

Option Equipment description 

1 Fixed roof tank (baseline) 

2b External floating roof tank, vapor-mounted 

primary and secondary seals 

3 Internal floating roof tank, bolted construction (contact or noncontact), vapor-mounted 

primary seal only, with uncontrolled deck 

fittings 

4 Internal floating roof tank, bolted construction (contact or noncontact), liquid-mounted 

primary seal only, with uncontrolled deck 

fittings 

5 Internal floating roof tank, bolted construction (contact or noncontact), liquid-mounted 

primary seal only, with controlled deck 

fittings 

6 Internal floating roof tank, bolted construction (contact or noncontact), liquid-mounted 

primary and secondary seals, with controlled 

deck fittings 

7 Internal floating roof tank, welded construction (steel pan or FRP deck), liquid-mounted 

primary and secondary seals, with controlled 

deck fittings 

8b Fixed roof tank with thermal oxidation, 

carbon adsorption or refrigerated condenser 

add-on vapor recovery equipment 

9 External floating roof tank, deck types are 

welded construction, liquid-mounted primary 

and secondary seals, controlled deck fittings 

are not applicable 

Abbreviated 

notation 

Fixed roof tank 

EFR 

vm,ss 

IFR b lm,cf,ss 

IFR 

w lm,cf,ss 

Vapor recovery 

or control 

EFRlm,ss 

alisted in order of decreasing emission rates; Control Option 1 

possessing the largest emission rate and Control Option 9 possessing 

the smallest emission rate. 

bThe rank based on emissions rate for this option varies depending on 

the specific parameters (e.g., number of turnovers, tank size) of 

the tank being considered. 

4-3 
been calculated and plotted in Figures 4-1 and 4-2. Figures 4-1 and 4-2 

are for tanks with 50 and 10 turnovers per year, respectively. The 

plotted emission rates are for a stored VOL with a vapor pressure (in 

liquid and condensed vapor phase) of 34.5 kPa (5 psia). (See Figures 4-1 

and 4-2.) 

Apart from the intrinsic emission-affecting characteristics of each 

tank type and equipment option, the emission rate from all storage 

vessel types is affected by the vapor pressure of the material stored 

and the frequency of tank turnovers. The impact of the vapor pressure 

and the turnover rate on the emission rate, however, varies among the 

three major tank types. Consequently, the hierarchy of equipment-types, 

or the relative emission rates of the various equipment types, can be 

affected by these variables. Comparison of Figures 4-1 and 4-2 illustrates 

the effects of turnovers. The tank scenarios, for which emission rates 

are plotted, are identical in these figures except for the turnover 

rate. Figure 4-1 is for tanks experiencing 50 turnovers per year and 

Figure 4-2 is for tanks experiencing 10 turnovers per year. It can be 

seen that decreasing the annual turnover rate from 50 to 10 decreases 

the emission rate for fixed roof tanks and fixed roof tanks with vapor 

recovery or control systems; conversely, the turnover rate has very 

little effect on internal and external floating roof tank emission 

rates: consequently, the higher the turnover rate~ the larger the 

difference between fixed roof and floating roof tank emission rates. 

The rank or relative effectiveness of fixed roof tanks equipped with 

vapor recovery or control devices is adversely affected by an increase 

in the turnover rate (i.e., the relative effectiveness as a control 

technique decreases). 

The effects that the vapor pressure of the stored VOL has on the 

relative emission rates of the equipment options are not illustrated by 

Figure 4-1. As the vapor pressure of the stored liquid increases, the 

emission rates from both fixed and floating roof tanks increase. However, 

the vapor pressure functions in the equations used to estimate losses 

from fixed and floating roof tanks differ, and, therefore, the percent 

increase in floating roof tank emissions is greater than the percent 

4-4 
s.... 

>, 

-

C'l 

::E: 

Q) 

-+J 

ro 

0::: 

VI 

~ 

0 

.,.... 

Ill 

Ill 

.,.... 

E 

w 

1,000 

100 -(1) 

10 

-(2) 

-(3) 

1.0 -(5) 

-(6) 

-(4) 

0.1 

10 100 1,000 10,000 

Tank Capacity (M3) 

Figure 4-1. Emissions rates for alternative equipment types 

(50 turnovers per year; vapor pressure= 1.0 psia). 

4-5 
s.... 

>, 

........ 

en 

::E: 

.......... 

QJ 

+-> 

<a 

a::: 

Vl 

s;; 

0 

.,.... 

Vl 

Vl 

.,.... 

E 

l.J..J 

1,000 

100 

10 

-(2) 

--(3) 

1.0 --(5) 

-(6) 

-(4) 

0.1 

0.01 

10 100 1,000 10,000 

Tank Capacity (M3) 

Figure 4-2. Emissions rates for alternative equipment types 

(10 turnovers per year; vapor pressure= 1.0 psia). 

4-6 
increase in fixed roof tank emissions for a similar increment in vapor 

pressure. (Note that this trend may reverse above 8.5 psia depending on 

the ratio of fixed roof tank breathing losses to working losses.) 

Consequently, an increase in vapor pressure decreases the difference 

between fixed and floating roof tank emission rates. This is opposite 

to the effect of the turnover rate. Within the range of conditions 

commonly found in VOL storage vessels, however, neither the effect of 

the vapor pressure nor the turnover rate changes the rank of the fixed 

roof tank and floating roof tank equipment options. 

Because the emission rate from all types of tanks is affected by a 

number of tank variables (i.e., vapor pressure, tank size, turnovers, 

the nature of the VOL), a single model tank is used as a common basis 

for evaluating effectiveness. The model tank has the following 

characteristics: 

• tank diameter- 9.1 m (30ft); 

• tank height- 9.1 m (30ft); 

• tank capacity - 606m3 (160,000 gallons); 

• vapor pressure of the VOL stored- 6.9 kPa (1 psia); 

• density of VOL stored - 7.4 lb/gallon; 

• molecular weight of the product vapor - 80 lb/lbmole; and 

• turnover rate - 50 per year. 

The emissions associated with the model tank under each equipment 

option have been estimated with the equations presented in Chapter 3 and 

listed for comparison in Table 4-2. The significance of these emission 

estimates are discussed in the following sections. 

4.2 FIXED ROOF TANKS 

A fixed roof tank is the minimum acceptable equipment currently 

employed for the storage of VOL. The discussion of control techniques, 

therefore, will relate the effectiveness of alternative storage equipment 

types to the effectiveness of fixed roof tanks. Working and breathing 

losses normally incurred from the storage of VOL in fixed roof tanks can 

be reduced in any of the following ways: 

(1) by the installation of an internal floating roof with rim 

seals; 

4-7 
+:> 

I 

CX> 

Fixed roof tank 

Breathing Working 

Losses Losses 

0.88 5.34 

Table 4-2. MODEL TANK EMISSION RATES FOR DIFFERENT EQUIPMENT OPTIONS1 

(Mg/yr) 

Sea 1 1 osses 

Type Emission 

Vapor-mounted 0.128 

Liquid-mounted 0.058 

Vapor-mounted 0.048 with secondary 

Liquid-mounted 

with secondary 0.031 

Internal floating roof tank 

Fitting losses 

Case Emission 

Uncontrollei 

Centro 11 ed3 

0.21 

0.11 

Deck losses 

Roof type Emission 

Bolted 

Welded 

0.04 

0.0 

Internal and 

external 

f1 oat i ng roof 

tank 

Working losses 

0.03 

1

Model tank parameters: 160,000 gallon capacity 

30 feet in diameter; 30 feet in height 

1 psia vapor pressure of the material stored 

80 lbs/lbmole molecular weight of the product as liquid product and as condensed vapor 

50 turnovers per year 

7.4 lb/gallon density 

External floating 

roof tank 

Seal losses 

Type Emission 

Vapor-mounted 4.59 

Liquid-mounted 0.21 

Vapor-mounted 1. 52 with secondary 

Liquid-mounted 0.034 with secondary 

Metallic shoe 0.727 

Metallic shoe 0.038 with secondary 

2

uncontrolled assumes: (1) access hatch, with ungasketed, unbolted cover; (2) automatic gauge float well, with ungasketed, unbolted cover; 

(3) 1-built-up column well, with ungasketed sliding cover; (4) ladder well, with ungasketed sliding cover; (5) 10-adjustable roof legs; 

(6) !-sample well with slit fabric seal (10% open area); (7) 7-one inch diameter stub drains; and (8) !-vacuum breaker with gasketed weighted 

mechanical actuation. 

3

controlled assumes: (1) !-access hatch, with gasketed, bolted cover; (2) !-automatic gauge float well, with gasketed, bolted cover; (3) 1-pipe 

column with flexible fabric sleeve seal; (4) !-ladder well, with gasketed sliding cover; (5) 10-adjustable roof legs; (6) sample well with slit 

fabric seal (10% open area); (7) 7-one inch diameter stub drains; and (8) vacuum breaker, with gasketed weighted mechanical actuation. 
(2) by the construction of an external floating roof tank with 

liquid-mounted primary and secondary seals in lieu of a fixed 

roof tank; and 

(3) by the installation and use of a vapor recovery system (e.g., 

carbon adsorption or refrigerated condensation) or a vapor 

control system (e.g., incineration). 

This list defines only the major types of control techniques applicable 

to the storage of VOL. Optional equipment designs that influence the 

effectiveness of minimizing VOL emissions exist within each major type 

of control technique. The following sections discuss the relative 

effectiveness of these equipment options. 

4.3 INTERNAL FLOATING ROOF TANKS 

Internal floating roof tanks with rim seal systems emit less VOC 

per unit of storage than fixed roof tanks. In new and replacement tank 

situations, internal floating roof tanks can be constructed in lieu of 

fixed roof tanks. In this sense they are a control technology for fixed 

roof tanks. Internal floating roofs also can be used directly as a 

control device for existing fixed roof tanks. This requires minor 

modifications to the tank shell (e.g., cutting roof vents). 

Depending on the type of roof and seal system selected, an internal 

floating roof in the model fixed roof tank will reduce the emission rate 

by 93.4 to 97.3 percent. An internal floating roof, regardless of 

design, reduces the area of exposed liquid surface in the tank. Reducing 

the area of exposed liquid surface, in turn, decreases the evaporative 

losses. The largest emissions reduction available from the control 

options is achieved by the presence of the floating roof vapor barrier 

that precludes direct communication between a large portion of the 

liquid surface and the atmosphere. All internal floating roofs share 

this design benefit. The relative effectiveness of one internal floating 

roof design over another, therefore, is a function of how well the 

floating roof can be sealed. 

From an emissions standpoint, the most basic internal floating roof 

design is the noncontact, bolted, aluminum, internal floating roof with 

a single vapor-mounted wiper seal. As discussed in Section 3.2.4.3, 

4-9 
there are four types of losses from this roof design. These losses with 

an estimate of their respective 

loss from the model tank are as 

(1) rim or seal losses; 

(2) fitting losses; 

percentage 

follows: 

32% 

51% 

(3) deck seam losses; and 10% 

(4) withdrawal losses. 7% 

contributions to the total 

With the exception of withdrawal losses, which are inherent in all 

internal floating roof designs, the losses listed above can be reduced 

by employing roofs with alternative design features. Table 4-3 lists 

alternative floating roof equipment designs and the model tank emission 

rate associated with each type of equipment. Table 4-3 is calculated 

from the emission estimates in Table 4-2 by adding the appropriate 

emission components for each case. The following sections elaborate on 

the alternative equipment that can be employed on internal floating 

roofs. The discussion is arranged according to the major emissions 

categories. 

4.3.1 Controls for Fitting Losses 

Fitting losses occur through the penetrations in an internal floating 

deck. Penetrations exist to accommodate the various types of fittings 

that are required for proper operation of an internal floating roof. 

Fitting losses can be controlled with gasketing anq sealing techniques, 

or by the substitution of a lower emitting fitting type that serves the 

same purpose. Table 4-4 lists the fitting types that are pertinent to 

emissions and an abbreviated description of the equipment that is considered 

to be representative of 11 uncontrolled11 fittings and 11 controlled11 fittings. 

Certain fitting types are not amenable to control. These are not listed 

in Table 4-4. Section 3.2.3 provides a more detailed description of the 

various fitting types and the 11 control techniques 11 that can be applied. 

The effectiveness of fitting 11 controls 11 at reducing the overall 

emission rate is a function of the number of fittings of each type that 

are employed on a given tank. On the model tank, which is representative 

of a typical medium sized tank, fitting 11 controls 11 reduce the total 

4-10 
Table 4-3. EFFECTIVENESS OF INTERNAL AND EXTERNAL 

FLOATING ROOF TANKS COMPARED TO A FIXED ROOF TANK FOR THE MODEL TANK1 

Internal or external floating 

roof tank Reduction over 

type2 Total emissio~ fixed roof tank 

Fixed roof tank Case Equipment rate (Mg/yr) emission rate 

Total emission rate 1 biFRvm 0.408 93.4% 

6.22 Mg/yr 

(Working loss= 5.34) 2 biFRvm,cf 0.308 95.0% 

(Breathing loss= 0.88) 

3 IFR b vm,cf,ss 0.228 96.3% 

4 biFRlm 0.338 94.6% 

5 biFRlm,cf 0.238 96.2% 

6 IFR b lm,cf,ss 0.211 96.6% 

7 IFR 

w lm,cf,ss 0.171 97.3% 

8 EFR4 

vm 4.62 25.7% 

9 EFR4 

vm,ss 1. 55 75.1% 

10 EFR4 

lm 0.24 96.1% 

11 4 

EFRlm,ss 0.064 99.0% 

12 EFR4 

ms 0.76 87.8% 

13 EFR4 

ms,ss 0.068 98.9% 

1

Model tank is 160,000 gallons capacity; 30 feet in diameter, 30 feet in 

height, 1 psia vapor pressure, 80 lb/lbmole molecular weight of product and 

condensed product vapor and 50 turnovers per year. 

2Nomenclature explanation - biFR - The subscript b or w indicates a 

bolted or welded roof deck; IFRv~~8f~gtes an internal floating roof type; EFR 

indicates an external floating roof tank type; the subscript vm, lm, or ms 

indicates a vapor-mounted, liquid-mounted or metallic shoe primary seal; the 

subscript cf indicates controlled fittings as described in the notes of 

Table 4-2; lack of the cf subscript indicates uncontrolled fittings; the 

subscript ss indicates a rim-mounted secondary seal; a lack of the ss 

subscript indicates that no secondary seal is employed. 

3sum of seal loss, fitting loss, deck loss and working loss from Table 4-2. 

4External floating roofs are all welded construction and do not incur 

appreciable deck seam losses. 

4-11 
Deck fitting type 

1. Access hatch 

2. Automatic gauge 

float well 

3. Column well 

4. Ladder well 

5. Sample pipe or 

well 

6. Vacuum breaker 

Table 4-4. 11 CONTROLLED 11 AND 11 UNCONTROLLED 11 

INTERNAL FLOATING ROOF DECK FITTINGS 

Equipment descriptions 

Uncontrolled Controlled 

Unbolted, ungasketed cover*; Bolted, gasketed cover 

or unbolted, gasketed 

cover 

Unbolted, ungasketed cover*; Bolted, gasketed cover 

or unbolted, gasketed 

cover 

Built-up column-sliding 

cover, ungasketed*; 

built-up column-sliding 

cover, gasketed; 

pipe column-sliding cover, 

ungasketed; or 

pipe column-sliding cover, 

gasketed 

Ungasketed sliding cover* 

Slotted pipe-sliding cover, 

ungasketed; or 

slotted pipe-sliding cover, 

gasketed 

Weighted mechanical 

actuation, ungasketed* 

Pipe column-flexible 

fabric sleeve seal 

Gasketed sliding cover 

Sample well with slit 

fabric seal, 10% open 

area* 

Weighted mechanical 

actuation, gasketed 

*The fittings assumed in the uncontrolled case for estimating the effectiveness of fittings controls are marked with a single asterisk in the above 

table. This fittings scenario is representative of no single tank, but 

rather is the composite of what is estimated based on a survey of users and 

manufacturers to be typical of fittings on the majority of tanks currently 

in service. Note that the sample well with split fabric seal was used in the 11 uncontrolled11 case for calculating emissions because it is in common use. 

It was also used in the ••controlled11 case because it is the lowest emitting 

fitting type. 

4-12 
fitting loss by about 48 percent. Since fitting losses are about 51 percent 

of the total internal floating roof tank loss (i.e., for an IFRvm case), 

the fitting 11 controls 11 reduce the overall internal floating roof tank 

emission rate by about 25 percent over the IFR without fitting controls. 

vm 

The additional emission reduction obtained by controlling fitting emissions 

increases the control efficiency of the IFR from 93.4 percent to 

95.0 percent over a fixed roof tank as the base case. 

4.3.2 Controls for Seal Losses 

Internal floating roof seal losses can be minimized in either of 

two ways or their combination: 

(1) by employing liquid-mounted primary seals instead of vapor-mounted 

seals; 

(2) by employing secondary wiper seals in addition to primary 

seals. 

All seal systems should be designed, installed and maintained to 

minimize the gap between the seals and the tank shell. The test data 

discussed in Appendix C support the general conclusion that seal losses 

increase rapidly when the seal gap exceeds 63.5 square centimeters per 

meter of tank diameter (3 in2 /ft diameter). Below this level, the 

effect of seal gap on seal loss is much less pronounced. 

The effectiveness of alternate internal floating roof seal systems 

can be evaluated through inspection of the rim seal loss factors (K ) - r 

that have been developed based on test data (summarized in Appendix C) 

for estimating losses for various seal systems. These factors are 

listed in Table 4-5. (Note these factors are for seals with average 

gaps.) Also listed in Table 4-5 are control efficiency and incremental 

control efficiency estimates. The control efficiency estimates (column 3 

in Table 4-5) indicate the effectiveness of the various seal systems at 

reducing emissions over the level achieved by a vapor-mounted primary 

seal. (Note that the vapor-mounted primary seal is assumed to be the 

baseline control level to provide a common basis of comparison.) The 

incremental control efficiency estimates (column 4 in Table 4-5) demonstrate 

the effectiveness of each seal system relative to the next less stringent 

seal system (i.e., the next higher emitting seal system). These 

efficiencies are calculated directly from the Kr values. 

4-13 
Table 4-5. INTERNAL FLOATING ROOF RIM SEAL SYSTEMS 

SEAL LOSS FACTORS AND CONTROL EFFICIENCIES 

Seal loss control 

K efficiency related Incremental 

Seal system ( 1 b-mo 1 &!ft-yr) to baseline control efficiency 

Vapor-mounted 6.7 IFR baseline (0%) primary seal only 

Liquid-mounted 3.0 55% 55% primary seal only 

Vapor-mounted 

primary and 2.5 63% 17% 

secondary seals 

Liquid-mounted 

primary and 1.6 76% 36% 

seconadary seals 

4-14 
Application of a liquid-mounted primary and secondary seal system 

in place of a vapor-mounted primary seal would reduce seal losses an 

estimated 76 percent. On the model tank, where these seal losses represent 

roughly one-third of the total loss from the tank (i.e., biFR case), vm 

this 76% reduction in seal losses translates to a 24% reduction in the 

total loss from the floating roof tank. Relative to fixed roof tank 

emissions, the additional control provided by the liquid-mounted primary 

and secondary seal system over the vapor-mounted primary seal system 

increases the effectiveness of the internal floating roof from 95.0 percent 

to 96.2 percent. (See Case 2 vs. Case 5 in Table 4-3.) 

The currently available emissions test data suggest that the location 

of the seal (i.e., vapor- or liquid-mounted) and the presence of a 

secondary seal are the primary factors affecting seal losses. A liquidmounted primary seal has a lower emissions rate and thus a higher control 

efficiency, than a vapor-mounted seal. A secondary seal, be it in 

conjunction with a liquid- or a vapor-mounted primary seal, provides an 

additional level of control. The emission test data (addressed in 

Appendix C) and the corresponding equations for estimating emissions 

(presented in Chapter 3) indicate that the type of seal employed (i.e., 

resilient tube seal, liquid-filled seal, etc.) plays a less significant 

role in determining the emissions rate. The type of seal is important 

only to the extent that the seal must be suitable for the particular 

application to which it is applied. For instance, a blade-type, 

elastomeric, wiper seal is commonly employed as a vapor-mounted primary 

seal or as a secondary seal for an internal floating roof. Because of 

its shape and materials of construction, this seal may not be suitable 

for use as a liquid-mounted primary seal. Resilient foam-filled tube 

and wedge shaped seals, on the other hand, can be used as both liquidand vapor-mounted seals. Section 3.2.2 provides additional information 

on the types of seals that are suitable for various applications. The 

point to be made here, however, is that the seal type has a small impact 

on seal losses relative to the impact of the location of the seal and 

the presence of a secondary seal. Appendix C addresses the test data 

pertinent to this conclusion. 

4-15 
4.3.3 Deck Seam Losses 

Depending on the type of floating roof employed, deck seam losses 

can contribute to the total loss from an internal floating roof. For 

the model tank used as a basis for comparison throughout this section 

(i.e., biFRvm), deck seam losses are 10% of the total loss. When seal 

losses and fitting losses are controlled, the relative contribution to 

the total loss from deck seams increases. In the case of a bolted, 

noncontact, internal floating roof with liquid-mounted primary seals, 

controlled deck fitting losses, and secondary seals (biFR1 f ), m,c ,ss 

deck seam losses contribute about 20 percent of the total loss. 

Deck seam losses are inherent in several floating roof types. Any 

roof constructed of sheets or panels fastened by mechanical fasteners 

(bolted) is expected to experience deck seam losses. Two roof types 

were tested to determine deck seam losses (see Appendix C). The first 

was a bolted, aluminum, noncontact roof and the second was a bolted, 

aluminum panel-type, contact roof. The design of the mechanical fasteners 

employed on these two roof types varies significantly. In addition, 

one roof type floats above the liquid surface while the other floats in 

contact with the liquid surface. Despite these differences, the seams 

on these two roof types were found to emit at roughly the same rate per 

meter of seam. Deck seam losses, therefore, are considered to be a 

function of the length of the seams only and not the type of the seam or 

its position relative to the liquid surface. 

The control for deck seam losses is achieved by selection of a roof 

type with vapor-tight deck seams. The welded deck seams on steel pan 

roofs are vapor tight. Also, it is likely that the fiberglass lapped 

seams of a glass fiber reinforced polyester roof (FRP) are vapor tight 

as long as the permeability of the liquid through the seam lapping 

materials is negligible. Some manufacturers provide gaskets for bolted 

metal deck seams. Deck seam gaskets also may retard deck seam losses by 

providing an additional barrier to diffusion and other possible deck 

seam loss mechanisms. The permeability of the liquid through the gasketing 

material also would be a factor. No test data are available to evaluate 

the effects of gaskets on deck seam losses. 

4-16 
Selection of a welded roof rather than a bolted roof will eliminate 

deck seam losses. The elimination of deck seam losses improves the 

overall effectiveness relative to a fixed roof tank of an internal 

floating roof with liquid-mounted primary seals, secondary seals and 

controlled fitting losses from a 96.6 to 97.3 percent control efficiency 

(see Case 6 vs. Case 7 in Table 4-3). 

4.4 EXTERNAL FLOATING ROOF TANKS 

External floating roof tanks emit less VOC per unit of storage 

capacity than fixed roof tanks. Depending on the rim seal system employed, 

they also can emit less VOC per unit of storage capacity than internal 

floating roof tanks. In the sense that external floating roof tanks may 

be used in place of fixed or floating roof tanks in new or replacement 

tank situations, they represent a control technology for the storage of 

VOL. 

External floating roof tanks do not experience the fitting losses 

or deck seam losses that occur with most internal floating roof tanks. 

The external floating roof tanks are constructed almost exclusively of 

welded steel. This accounts for the absence of deck seam losses. 

Further, because of the roof design, few if any deck penetrations are 

necessary to accommodate fittings. 

Penetrations in an external floating roof tank generally are needed 

only for some types of antirotation guides and emergency liquid drains. 

These fitting types are not employed on all external floating roofs. 

Because the number of deck penetrations in an external floating roof is 

small relative to the number in an internal floating roof, fitting 

losses from external floating roof tanks are assumed to be negligible. 

No emission test data, however, are available to verify this assumption. 

Rim seal losses and withdrawal losses that are similar in nature to 

those experienced by internal floating roof tanks, do occur with external 

floating roof tanks. The only difference in this respect between external 

floating roofs and internal floating roofs is that the external floating 

roof seal losses are believed to be dominated by wind induced mechanisms. 1 

Withdrawal losses in external floating roof tanks, as with internal 

floating roof tanks, are entirely a function of the turnover rate and 

4-17 
inherent tank shell characteristics. No control measures have been 

identified that are applicable to withdrawal losses from floating roof 

tanks. 

Rim seal losses from external floating roof tanks vary depending on 

the type of seal system employed. As with internal floating roof rim 

seal systems, the location of the seal (i.e., vapor- or liquid-mounted) 

is the most important factor affecting the effectiveness of resilient 

seals for external floating roof tanks. Liquid-mounted seals are more 

effective than vapor-mounted seals at reducing rim seal losses. Metallic 

shoe seals, which commonly are employed on only external floating roof 

tanks, are more effective than vapor-mounted resilient seals but less 

effective than liquid-mounted resilient seals. 

The relative effectiveness of the various types of seals can be 

evaluated by analyzing the seal factors (Ks factor and wind velocity 

exponent, N) contained in Table 3-4 of the previous chapter. These seal 

factors were developed on the basis of emission tests conducted on a 

pilot scale tank. The results of the emission tests are published in an 

American Petroleum Institute bulletin. 3 To compare the relative 

effectiveness of the alternate seal systems, the seal factors were used 

with an assumed wind velocity (10 MPH) to generate directly comparable 

emission factors. These factors 1 which have meaning only in comparison 

to one another, are listed in Table 4-6 for alternative seal systems. 

In addition, the table contains control efficiencies (relative to the 

least effective seal system) and incremental control efficiencies (relative 

,to the next higher emitting seal system) calculated directly from the 

emission factors. From the information in Table 4-6, it is clear that 

vapor-mounted primary seals on external floating roof tanks are 

significantly less effective than liquid-mounted or metallic shoe primary 

seals. Further, secondary seals provide an additional measure of control. 

Considering the model tank that is used as a basis of comparison 

throughout this chapter, an external floating roof tank with liquid-mounted 

primary seals has about the same effectiveness as an internal floating 

roof tank with liquid-mounted primary seals and controlled fitting 

losses (see Case 10 vs. Case 5 in Table 4-3). An external floating roof 

4-18 
Table 4-6. EXTERNAL FLOATING ROOF lANK 

SEAL SYSTEM CONTROL EFFICIENCIES 

Seal system description 

Vapor-mounted resilient 

primary seal only 

Vapor-mounted resilient 

primary seal and 

secondary seal 

Metallic shoe primary 

seal only 

Metallic shoe primary 

seal with a shoemounted wiper seal 

Liquid-mounted resilient 

primary seal only 

Metallic shoe primary 

seal with rim-mounted 

secondary seal 

Liquid-mounted resilient 

primary seal with rimmounted secondary seal 

Emissiogs 

factor N 

Ks (10) 

239 

80 

38 

13 

11 

2.0 

1.8 

Seal loss 

control b 

efficiency 

EFR assumed 

baseline seal 

technology 

66% 

84% 

95% 

95% 

99% 

99% 

Incremental seal 

loss controt 

efficiency 

66% 

53% 

66% 

Negligible 

difference 

82% 

Negligible 

difference 

aFor well designed seal systems with 11 average 11 gaps between the seal and 

the tank shell. Calculated from the Ks and N values listed in 

Table 3-4. 

bRim seal loss control efficiency relative to the least effective seal 

alternative. 

cRim seal loss control efficiency relative to the next less effective 

seal alternative. 

4-19 
tank with liquid-mounted primary and secondary seals yields the highest 

level of control achievable with the floating roof tank technology. A 

welded internal floating roof tank with liquid-mounted primary and 

secondary seals and controlled fitting losses reduces emissions over the 

fixed roof tank level by about 97.3 percent (see Case 7 in Table 4-3). 

An external floating roof tank with liquid-mounted primary and secondary 

seals exceeds this control level and achieves an estimated 99.0 percent 

reduction in emissions over the fixed roof tank level. The percentage 

reduction in emissions over the fixed roof tank case will vary, of 

course, with tank characteristics (e.g., tank size, vapor pressure of 

material stored). The external floating roof with liquid-mounted primary 

and secondary seals, however, remains the most effective floating roof 

tank technology from an emissions reduction standpoint. It must be 

recognized that this conclusion, as with all the conclusions in this 

chapter about the relative effectiveness of floating roof designs, is 

based on the results of emission tests conducted on a pilot scale tank 

(summarized in Appendix C). The test program was extensive in nature, 

but caution must be exercised when extrapolating results and conclusions 

to full size facilities that can be influenced by a large number of 

factors that cannot be easily controlled in a real environmen~ (e.g., 

wind speed, temperature, etc.). 

4.5 VAPOR CONTROL OR RECOVERY SYSTEMS ON FIXED ROQF TANKS 

Losses from fixed roof tanks can be reduced by collecting the 

vapors and either recovering or oxidizing the VOC. In a typical vapor 

control system, vapors remain in the tank until the internal pressure 

reaches a preset level. A pressure switch, which senses the pressure 

buildup in the tank, then activates blowers to collect and transfer the 

vapors through a closed vent system. A redundant blower system is 

provided in this service to ensure that no vapors will be released to 

the atmosphere in the event of a primary blower malfunction. The closed 

vent system ducts the vapors to a recovery or oxidizer unit. 

To prevent flashbacks from the control equipment, the vapors in the 

closed vent system from the tank may be saturated above the upper explosive 

limit in a saturator. Other safety precautions also are exercised such 

4-20 
as nitrogen blanketing and use of flame arrestors. The particular 

precautions employed vary widely depending on the design of individual 

systems and the operating preference of individual companies. 

4.5.1 Carbon Adsorption 

Although there is little commercial operating experience for VOL 

applications of carbon adsorption, carbon adsorption for recovery of 

other organic vapors has been demonstrated, and the application of this 

technology to VOL recovery should not be difficult. 4 The general principle 

of adsorption is described below to facilitate the description of a 

carbon adsorption unit. 

Carbon adsorption uses the principle of carbon's affinity for 

nonpolar hydrocarbons to remove VOC from the vapor phase. Activated 

carbon is the adsorbent; the VOC vapor that will be removed from the 

airstream is referred to as the adsorbate. The VOC vapor is adsorbed by 

a physical process at the surface of the adsorbent. The proposed VOC 

carbon adsorption unit consists of a minimum of two carbon beds plus a 

regeneration system. Two or more beds are necessary to ensure that 

one bed will be available for use while the other is being regenerated. 

The carbon beds can be regenerated using either steam or vacuum 

(Figure 4-3). In steam regeneration, steam is circulated through the 

bed, raising the VOC vapor pressure. The vaporized VOC is thus removed 

with the steam. The steam-VOC mixture is condensed, usually by an 

indirect cooling water stream, and routed to a separator. The VOL is 

then decanted and returned to storage, and the contaminated water is 

sent to the plant wastewater system for treatment. Cooling water, 

electricity, and steam are the required utilities for a steam regeneration 

system. The other method of regenerating the carbon, vacuum regeneration, 

is performed by pulling a high vacuum on the carbon bed. The VOC vapor 

desorbed by this process is condensed and returned to storage. 

4.5.2 Oxidation Units 

Thermal and catalytic oxidizers have been used successfully to 

dispose of VOC vapors in other industries. Thermal oxidation is the 

most direct means of VOC vapor disposal, uses the fewest moving parts 

and is the simplest to operate. The vapor mixture is injected via a 

4-21 
~ 

I 

N 

N 

Carbon 

Bed 

Afr-Yapor • • • • l C Mixture I 

I 

I 

I 

I 

I 

I 

I 

~ Thermal 

Purge 

Carbon 

Bed 

Water Seal 

Steam Supply 

or 

Vacuum Pump 

Air-Vapor Recycle 

Cooler 

Water 

Separator 

Figure 4-3. Carbon adsorption unit using steam regeneration. 

I ... Recovered 
burner manifold into the combustion area of the incinerator. Pilot 

burners provide the ignition source, and supplementally fueled burners 

add heat when required. The amount of combustion air needed is regulated 

by temperature-controlled dampers. Figure 4-4 shows a typical thermal 

oxidation unit. 

Flashback prevention and burner stability can be achieved by saturating 

the vapors with a suitable hydrocarbon to a concentration above the 

upper explosive limit. In addition, two water seal flame arrestors can 

be used to ensure that flashbacks do not propagate from the burner to 

the rest of the closed vent system. As mentioned, safety practices and 

equipment vary widely depending on system design and the operating 

preference of individual companies. A significant advantage of thermal 

oxidizers is that they can dispose of a wide range of VOLs. Fuel 

consumption and catalyst repacement are the major cost factors in 

considering thermal and catalytic oxidation. 

4.5.3 Refrigerated Vent Condensers 

A refrigerated vent condenser collects the VOL vapors exiting 

through the vents and condenses them. The vents open and close as the 

pressure within the tank increases and decreases. Pressure changes 

occur when the tank is being filled or emptied, or when the temperature 

changes. Condensers are designed to handle the maximum flow rate expected 

at any given time, which usually occurs during filling. Freezing of 

moisture or VOL is handled by a defrost-separation-recovery system. The 

efficiency of vent condensers depends upon the vapor concentration and 

the condensing temperature. 

4.5.4 Control Efficiencies of Vapor Recovery or Control Systems 

The carbon adsorption vapor control system is estimated to reduce 

emissions from the VOL storage vessel by approximately 98 percent. This 

efficiency is based on a measured carbon adsorption unit efficiency of 

98 percent during gasoline loading operations. 5 

The thermal oxidation vapor control system is estimated to reduce 

emissions from the VOC storage vessel by approximately 98 percent. This 

efficiency is based on a measured thermal oxidation unit efficiency of 

98 percent during a wide variety of operations. 6•

7 At very low flow 

rates, or at low VOC inlet concentrations, somewhat less than 98 percent 

of the VOC vapors leaving the storage vessel may be incinerated. 

4-23 
OUTLET VAPOR 

PILOT 

BURNER 

FUEL 

c 

_,.-

~STACK 

MAIN BURNER. 

FUEL 

8URNEn 

VAPOR~~ ~: .,...~ ~o----4 

AIR DAMPER 

WATER SEAL-~ 

Figure 4-4. Thermal oxidation unit. 4 

4-24 

. 

• 

VOL 

VAPOR SOURCE 
4.6 REFERENCES 

1. The American Petroleum Institute (API), Draft Document, Evaporation 

Loss from Internal Floating Roof Tanks, API Publication 2519, 

Third Edition, 1982. 

2. McAllister, Dr. R. Memorandum to the Volatile Organic Liquid 

Storage Standard Docket (No. A-80-51) regarding permeability losses 

through seal materials and deck seal loss mechanisms. Dated 

February 1983. 

3. Evaporation Loss from External Floating Roof Tanks. Bulletin 

No. 2517. American Petroleum Institute. Washington, D.C. 1980. 

4. U.S. Environmental Protection Agency, Evaluation of Control Technology 

from Benzene Transfer Operations, Research Triangle Park, 

North Carolina, EPA-450/3-78-018, April 1978. 

5. Letter from McLaughlin, Nancy D., U.S. Environmental Protection 

Agency to D. Ailor, TRW Inc. Comments on the benzene storage model 

plants package. May 3, 1979. 

6. Letter and attachments from D. C. Mascone, EPA/CPB, to J. R. Farmer, 

EPA. June 11, 1980. Memo concerning thermal incinerator performance 

for NSPS. 

7. U.S. Environmental Protection Agency. Organic Chemical Manufacturing, 

Volume 4: Combustion Control Devices. Research Triangle Park, 

North Carolina. Publication No. EPA-450/3-80-026. December 1980. 

4-25 
5. MODIFICATIONS AND RECONSTRUCTION 

After the new source performance standards (NSPS) have been promulgated 

in accordance with Section lll of the Clean Air Act, as amended, all 

affected facilities will include those facilities constructed, modified, 

or reconstructed after the date of promulgation. The NSPS could also 

apply to an existing facility as defined in 40 CFR 60.2. An existing 

facility would become an affected facility if it were determined to be 

modified or reconstructed. This chapter describes the conditions under 

which an existing facility would become subject to the standards of 

performance. The enforcement division of the appropriate EPA regional 

office would make the final determination as to whether a source were 

modified or reconstructed and would therefore become an affected facility. 

This chapter also defines potential modifications and reconstructions. 

5.1 PROVISIONS FOR MODIFICATIONS AND RECONSTRUCTION 

5.1.1 Definition of Modification 

It is important that these provisions be understood before considering 

examples of potential modifications. Section 60.14 defines modification 

as follows: 

"Except as provided under paragraphs (e) and (f) of this 

section, any physical or operational change to an existing 

facility which results in an increase in the emission rate to 

the atmosphere of any pollutant to which a standard applies 

shall be considered a modification within the meaning of 

Section 111 of the Act. Upon modification, an existing facility 

shall become an affected facility for each pollutant to which 

a standard applies and for which there is an increase in the 

emission rate to the atmosphere. 11 

Paragraph (e) lists certain physical or operational changes that 

are not considered modifications, regardless of any changes in the 

emission rates. These changes are: 
l. Routine maintenance, repair, and replacement. 

2. An increase in the production rate not requiring a capital 

expenditure as defined in Section 60.2. 

3. An increase in the hours of operation. 

4. Use of an alternative fuel or raw material if, prior to the 

standard, the existing facility was designed to accommodate 

that alternate fuel or raw material, except for conversion to 

coal required for energy consideration. 

5. The addition or use of any system or device whose primary 

function is the reduction of air pollutants, except when an 

emission control system is removed or replaced by a system 

considered to be less efficient. 

6. The relocation or change in ownership of an existing facility. 

Paragraph (b) specifies that an increase in emissions is defined in 

kilograms per hour and delineates the methods for determining the increase, 

including the use of emission factors, material balances, continuous 

monitoring systems, and manual emission tests. Paragraph (c) affirms 

that the addition of an affected facility to a stationary source does 

not make any other facility within that source subject to standards of 

performance. Paragraph (f) simply provides for superseding any 

conflicting provisions. 

5.1.2 Definition of Reconstruction 

Section 60.15 regarding reconstruction states: 

11 If an owner or operator of an existing facility proposes 

to replace components, and the fixed capital cost of the new 

components exceeds 50 percent of the fixed capital cost that 

would be required to construct a comparable entirely new 

facility, he shall notify the Administrator of the proposed 

replacements. The notice must be postmarked 60 days (or as 

soon as practicable) before construction of the replacements 

is commenced ... 11 

The reconstruction provision of the regulation prevents an owner or 

operator from continuously replacing an operating process, except for 

support structures, frames, housing, etc. in an attempt to avoid 

compliance with NSPS. 

5-2 
5.2 APPLICABILITY TO VOLATILE ORGANIC LIQUID STORAGE 

This section outlines the applicability of the modification provisions 

to existing plants and describes the applicability of reconstruction to 

this industry. This is only a general discussion of changes that would 

require an existing facility to comply with the standard. The final 

determination would be made by the appropriate EPA regional office on a 

case-by-case basis. 

5.2.1 Modification Examples 

Few, if any, modifications can be made to a storage vessel. Because 

replacement of frame, housings, and supporting structures would not 

increase emissions from a storage vessel, such a replacement would not 

constitute a modification. For the purposes of applicability of these 

CAA provisions to a storage vessel, a change in the stored liquid from a 

reactive VOC non-emitting liquid to a reactive VOC emitting liquid does 

not constitute an operational change; the vessel operation would be 

identical for all liquids. A change of liquids, therefore, does not 

constitute a modification. 

5.2.2 Reconstruction Examples 

The reconstruction provision of the regulation is relatively 

straightforward in that, regardless of the VOC emission rate, an existing 

facility may become an affected facility if the fixed capital cost of 

new components exceeds 50 percent of the fixed capital cost of a comparable, 

entirely new facility. It is expected that only under catastrophic 

circumstances (e.g., total destruction of the storage vessel by fire or 

explosion, collapse of an external floating roof or collapse of a fixed 

roof) would a facility be affected by the NSPS reconstruction provision. 

Because associated structures (frames, housing, etc.) are not part of a 

tank, replacement of such a structure would not constitute a reconstruction. 

5-3 

6. REGULATORY ALTERNATIVES AND MODEL PLANTS 

This chapter defines control options that are to be evaluated as 

regulatory alternatives in developing standards of performance for the 

storage of volatile organic liquids (VOL). The technologies that constitute 

the control options are applicable to specific storage vessel types. A 

regulatory alternative refers to a potential requirement that a particular 

control technology or an array of technologies (a control option) be 

applied to all new, modified, and reconstructed storage vessels. In 

evaluating the economic impacts of the regulatory alternatives, model 

plants are employed. Both the regulatory alternatives and the model 

plants are presented in this chapter. 

6.1 REGULATORY ALTERNATIVES 

The methodology for selecting the Best Demonstrated Technology (BOT) 

for VOL storage vessels focuses on the impacts and costs of applying 

control options to specific tank types. Discussions of this methodology 

and the selection of BOT are contained in the preamble. The nationwide 

environmental and economic impacts of BOT, however, must be evaluated. 

Therefore, in order to structure and to perform these analyses, potential 

control options that might comprise BOT have been arrayed into regulatory 

alternatives. 

Three criteria were used to select control options for evaluation 

as regulatory alternatives. They are: 

1. Potential emission reduction; 

2. Cost; and 

3. Applicability. 

In Chapter 4 the potential control technologies that may reasonably 

constitute BOT are identified. Table 4-2 presents the potential emission 

reduction obtained by various equipment types on various emission sources, 
and Table 4-3 presents the emission reduction obtained over a fixed roof 

tank baseline. In Chapter 8, Tables 8-20 through 8-24 present the 

individual tank cost effectiveness analysis of potential control 

technologies for BOT. 

To analyze the impacts of regulatory alternatives, the emissions 

from the baseline (no additional Federal regulation) must be calculated. 

Therefore, Regulatory Alternative 0 would require no additional equipment 

over currently required controls and represents the VOL baseline. All 

emissions and costs of subsequent regulatory alternatives are analyzed 

relative to the baseline data. 

Current regulations (the baseline) allow fixed roof storage vessels 

to be constructed in certain size and vapor pressure ranges. Because 

BOT could involve internal floating roof tanks, it was decided to examine 

the impacts of requiring that fixed roof tanks be constructed as internal 

floating roof tanks. As the tables in Chapter 4 demonstrate, building 

new internal floating roof tanks with vapor-mounted primary seals and 

typical fittings in place of fixed roof tanks, provides a 93 percent 

emission reduction in the model storage vessel. (The model vessel is 

described in Chapter 4.) This is equivalent to the level of control 

required by the NSPS for petroleum liquid storage vessels. This equipment 

(internal floating roof, vapor-mounted primary seal, and uncontrolled 

fittings) was selected as Regulatory Alternative I. 

Internal floating roof tanks have four emission sources. These 

are: 

1. Rim seal losses; 

2. Fitting losses; 

3. Deck seam losses; and 

4. Working losses. 

Equipment that will reduce emissions from these sources is available. 

Therefore, potential emission reductions from these sources were examined 

for the development of regulatory alternatives. 

As demonstrated in Chapter 4, equipping internal floating roof 

tanks with liquid-mounted primary seals instead of vapor-mounted primary 

seals would provide an additional emissions reduction by decreasing the 

rim seal losses. To examine the impacts of this equipment, Regulatory 

6-2 
Alternative II would require each tank to be equipped with an internal 

floating roof with a liquid-mounted primary seal but would allow 

uncontrolled fittings. This alternative would reduce fixed roof tank 

emissions by 95 percent. 

The next more stringent control option would require an emission 

reduction from the fittings on internal floating roof tanks. To examine 

the impacts of this equipment, Regulatory Alternative III is formulated 

by requiring that the internal floating roof be equipped with a liquid 

mounted primary seal and controlled fittings. This alternative would 

reduce fixed roof tank emissions by about 96 percent. 

At this point in the development of regulatory alternatives all the 

emission sources of the internal floating roof with the exception of 

working losses and deck seams have been controlled. There are no equipment 

controls for working losses, so no regulatory alternative to examine the 

impacts of controlling these losses could be developed. In examining 

controls for deck seams, the information presented in Tables 8-21 and 8-22 

demonstrates that it is more cost effective to require a further emission 

reduction from the rim seal area than from deck seams. To examine this, 

Regulatory Alternative IV was formulated by requiring that an internal 

floating roof be equipped with a liquid-m9unted primary seal and a 

secondary seal and with controlled fittings. This group of control 

technologies reduces the fixed roof tank emissions _by about 97 percent. 

Regulatory Alternative V requires that deck seam emissions be 

reduced through the use of welded decks in addition to the equipment 

required by Alternative IV. This array of equipment reduces fixed roof 

tank emissions by about 97 percent. 

At this point in the development of regulatory alternatives all of 

the emissions sources from internal floating roof tanks have been reduced 

to the greatest possible extent. Therefore, other control options that 

do not involve internal floating roofs were examined. 

Tanks could be equipped with vapor control recovery systems. Such 

a system would be expected to provide about 95 percent emission reduction. 

This system is not as efficient as the control equipment required by 

Regulatory Alternatives IV and V and is much more costly. Therefore, 

vapor control or recovery systems were rejected as a regulatory alternative. 

6-3 
External floating roof tanks with liquid-mounted or mechanical 

shoes primary seals and a secondary seal were examined as a possible 

regulatory alternative. External floating roof tanks are only available 

in size ranges that are generally larger than the size range of most VOL 

tanks; 59 percent of VOL storage vessels are projected to have diameters 

less than 6 meters. For these reasons external floating roof tanks were 

not selected for evaluation as a regulatory alternative. 

In summary, the regulatory alternatives would require that each 

vessel storing a VOL be equipped with the control technology described 

as follows: 

• Regulatory Alternative 0- no additional control over baseline. 

• Regulatory Alternative I - an internal floating roof with a 

vapor-mounted primary seal (IFRvm). 

• Regulatory Alternative II - an internal floating roof with a 

liqud-mounted primary seal (IFR1

m). 

• Regulatory Alternative III - an internal floating roof with a 

liquid-mounted primary seal and controlled deck fittings 

(IFR1 f). m,c 

• Regulatory Alternative IV - an internal floating roof with a 

liquid-mounted primary seal controlled deck fittings, and a 

continuous secondary seal (IFR1 f ). m,c ,ss 

• Regulatory Alternative V - a welded internal floating roof 

with a liquid-mounted primary seal, controled deck fittings 

and a continuous secondary seal ( IFR1 f ). w m,c ,ss 

6.2 MODEL PLANTS 

Model plants are developed for use in evaluating the worst-case 

economic impacts that the regulatory alternatives may have on affected 

industries. For VOL storage, as is discussed in Chapter 7, nationwide 

impacts are projected from an extrapolation of the 1977 tank volume and 

vapor pressure distribution as presented in Section 3.1. The model 

plants described in this chapter are used to evaluate potential adverse 

economic impacts on individual plants. (The economic impact analyses 

6-4 
are presented in Chapter 9.) Because there is a greater potential 

adverse economic impact upon small facilities, small plants or facilities 

are selected as worse-case examples. The model plants consist of a 

model terminal and a model producer/consumer. These model plants are 

based on actual facilities that have parameters suitable for use in the 

economic impact analysis. 

6.2.1 Model Terminal 

The model terminal data are presented in Table 6-1. These data are 

formatted to facilitate comparison with the nationwide VOL storage 

terminal statistics presented in Chapter 3 (see Table 3-3). The model 

has roughly as many vessels as the average terminal. However, for the 

most part, the vessels in the model terminal are smaller in size than 

the vessels in the average terminal. In general, small vessels are more 

expensive per unit volume of storage capacity to control than larger 

vessels. Also, the volume of material that passes through the model 

terminal is small. Because of this, the additional costs that result 

from the implementation of regulatory alternatives are higher on a 

per-volume-throughput basis. Finally, as a general rule, any small 

business faces higher costs of capital than a large corporation. It is 

assumed that the model terminal operates as an independent facility and 

would, therefore, face these higher costs of capital. 

6.2.2 Model Producer/Consumer 

The model producer/consumer represents a small chemical manufacturing 

facility. It is assumed that a small facility is likely to be more 

severely affected by the regulatory alternatives under consideration. 

The model producer/consumer facility consists of small vessels and 

produces small amounts of an inexpensive product. The lower product 

price minimizes potential recovery credits associated with the installation 

of controls. 

The model producer/consumer data are presented in Table 6-2. The 

model facility produces fewer than 4.54 x 106 kilograms per year (10 7 pounds 

per year) of a product that sells for $0.35 per kilogram ($0.16 per 

pound). Both the production capacity and product price for the model 

producer/consumer are smaller than the average capacity and price for 

organic chemicals estimated from the Organic Chemical Producters Data 

Base (see Chapter 9). 

6-5 
Table 6-1. MODEL TERMINAL 

Terminal capacity - 14,000 m3 (~3.6 x 106 gal) 

Number of tanks - 48 

Volume of smallest tank - 3.8 m3 (~1,000 gal) 

Average tank volume - 300 m3 (~80 x 103 gal) 

Volume of largest tank - 2,300 m3 (~600 x 103 gal) 

Average number of annual 

turnovers per tank - 2.9 

Terminal throughput - 39,000 m3 (~10,000 x 103 gal) 

Table 6-2. MODEL PRODUCER/CONSUMER 

Plant production capacity - <4.5 x 106 kg/year 

(<107 lb/yr) 

Plant tank capacity - 2,000 m3 (~530 x 103 gal) 

Number of tanks - 11 

Average tank volume - 190 m3 (~50 x 103 gal) 

Volume of largest tank - 330 m3 (~88 x 103 gal) 

Volume of smallest tank - 14m3 (~4,000 gal) 

6-6 
7. ENVIRONMENTAL IMPACTS 

7.1 INTRODUCTION 

This chapter discusses the fifth-year environmental impacts of each 

regulatory alternative presented in Chapter 6. The fifth-year impacts 

are the impacts that would be incurred by the new, modified, and 

reconstructed facilities constructed during the five years following 

implementation of the regulatory alternatives. In these analyses, a 

base year of 1983 is assumed (i.e., the regulatory alternatives would be 

in force starting in 1983). The nationwide impacts that are evaluated 

include: 

• air pollution impacts; 

• water pollution impacts; 

• energy impacts; and 

• other environmental concerns. 

The nationwide impacts are developed from the number of affected 

facilities (i.e., VOL storage vessels) projected to be constructed 

during the five years following the baseline date. Chapter 9 explains 

the derivation of a bivariate distribution, by tank size and vapor 

pressure of the VOL stored, of the numbers of affected facilities that 

are projected to be constructed between 1983 and 1988. The potential 

environmental impacts of the regulatory alternatives are estimated with 

this bivariate distribution of affected facilities and the knowledge of 

the baseline control levels (discussed in Section 3.3) that would result 

in the absence of performance standards. 

7.2 AIR POLLUTION IMPACTS 

Adoption of any of the regulatory alternatives will reduce VOC 

emissions in the years following the implementation. The magnitude 
of the emissions reductions to be achieved by the regulatory alternatives 

is estimated based on the estimated five-year total number of affected 

new and replacement tanks to be constructed, the tank size vapor pressure 

percentage distribution discussed in Chapter 9, and the equations for 

predicting emissions from the various VOL storage vessel equipment types 

(presented in Section 3.2). An average emission rate for tanks in each 

tank size/vapor pressure interval in the distribution is calculated by 

using the average capacity of the interval, the average vapor pressure 

of the interval, and the average number of tank turnovers for the tank 

size range. The emissions per tank in the interval are then multiplied 

by the number of tanks in the tank size/vapor pressure interval. The 

total emissions rate for a given regulatory alternative is determined by 

summing across the tank size/vapor pressure intervals. This procedure 

is repeated for the baseline control level and each regulatory alternative. 

Emissions reductions are determined by subtracting the baseline emissions 

rate from the emissions rate for each regulatory alternative. 

Table 7-1 and 7-2 list the emission rates and emission reductions, 

respectively, associated with each regulatory alternative. The emission 

values in the tables are in megagrams per year, reflecting the annual 

emissions or emission reduction from the affected facilities that are 

projected to be constructed during the five years following the baseline 

date (1983-1988). Each table provides estimates for ten alternate tank 

size/vapor pressure cutoff levels. For example, row two of Table 7-1 

provides emission estimates assuming that the minimum tank size affected 

by the regulation is 75 m3 (20,000 gallons) and the minimum vapor pressure 

affected by the regulation is 3.5 kPa (0.5 psia). A projected 3,749 tanks 

will be constructed in the five years following 1983 that are above 

these cutoff conditions and, therefore, would be affected by an NSPS 

that implemented cutoffs at these levels. The tanks regulated at this 

cutoff will emit 10,845 Mg/yr under the baseline control level, 2,502 Mg/yr 

under Regulatory Alternative I and so forth for the remaining regulatory 

alternatives. Referring to Table 7-2 for this same cutoff, Regulatory 

Alternative I will effect a 8,343 Mg/yr reduction in VOC emissions; 

Regulatory Alternative II will effect a 8,780 Mg/yr reduction in VOC 

emissions, and so forth for the remaining regulatory alternatives. 

7-2 
-.....J 

I 

w 

Table 7-1. FIFTH-YEAR EMISSIONS RESULTING FROM THE REGULATORY ALTERNATIVES 

Cutoff Leve 1 

Tank Size/Vapor Pressure Emissions for Each Regulatory Alternative (Mg/yr) 

Number of 

m3 /kPa 1000 gal/psia 

Affected 

Facilities Baselineb a Ic lid IIIe IVf vg 

0/0 0/0 16,086 22,171 4,272 3,659 2,540 2,308 2,047 

75/3.5 20/0.5 3,748 10,845 2,502 2,065 1,498 1,333 1,110 

75/6.9 20/1.0 2,686 7,009 2,273 1,871 1,357 1,205 997 

75/10.3 20/1.5 2,027 2.960 2,032 1,670 1,211 1,074 885 

114/3.5 30/0.5 3,167 9,685 2,245 1,841 1,354 1,201 985 

114/6.9 30/1.0 2,287 5,993 2,046 1,673 1,230 1,089 887 

114/10.3 30/1.5 1,726 2,072 1,832 1,495 1,099 972 789 

151/3.5 40/0.5 2,945 9,240 2,148 1,757 1,300 1,152 939 

151/6.9 40/1.0 2,138 5,610 1,961 1,601 1,183 1,047 848 

151/10.3 40/1.5 1,628 1,762 1,762 1,436 1,060 937 757 

a The number of new, modified, and reconstructed storage vessels that meet the 

and, therefore, would be affected by the regulatory alternatives. 

respective cutoff criteria 

b biFR and fixed roof tank mixed baseline (see Section 3.3). vm 

c IFR 

d b vm 

biFRlm 

e IFR f b lm,cf 

IFR b lm,cf,ss 

g IFR 

w lm,cf,ss 
....... 

I 

.p. 

Table 7-2. FIFTH-YEAR EMISSIONS REDUCTIONS RESULTING FROM THE REGULATORY ALTERNATIVES 

Cutoff Level Emissions Reduction Obtained by Each Regulatory Alternative 

Tank Size/Vapor Pressure (Mg/yr) 

Number of 

m3 /kPa 1000 gal/psia 

Affected 

Facilitiesa Baseline b Ic lid Ille IVf vg 

0/0 0/0 16,086 0 17,899 18,512 19,631 19,863 20,124 

75/3.5 20/0.5 3,748 0 8,343 8,780 9,347 9,512 9,735 

75/6.9 20/1.0 2,686 0 4,736 5,138 5,652 5,804 6,012 

75/10.3 20/1.5 2,027 0 928 1,290 1,749 1,886 2,075 

114/3.5 30/0.5 3,167 0 7,440 7,844 8,331 8,484 8,700 

114/6.9 30/1.0 2,287 0 3,947 4,320 4,763 4,904 5,106 

114/10.3 30/1.5 1,726 0 240 577 973 1,100 1,283 

151/3.5 40/0.5 2,945 0 7,092 7,483 7,940 8,088 8,301 

151/6.9 40/1.0 2,138 0 3,649 4,009 4,427 4,563 4,762 

151/10.3 40/1.5 1,628 0 0 326 702 825 1,005 

a The number of new, modified, and reconstructed storage vessels that meet the respective cutoff criteria 

and, therefore, would be affected by the regulatory alternatives. 

b biFRvm and fixed roof tank mixed baseline (see Section 3.3). 

c IFR 

d b vm 

biFRlm 

e IFR f b lm,cf 

IFR b lm,cf,ss 

g IFR 

w lm,cf,ss 
7.3 WATER QUALITY AND SOLID WASTE IMPACTS 

The control technologies selected as regulatory alternatives do not 

generate wastewater or solid waste during their operation as control 

devices. During tank turnarounds and periods when tanks are not in 

service, however, wastewater and solid waste may be generated. Inspection 

and maintenance operations can generate both wastewater and liquid/solid 

wastes that require treatment or special disposal techniques. Most 

major inspections and/or repairs require that the vessel be cleaned and 

degassed. The concern is that the environment inside the tank be free 

of potential explosive and toxic hazards prior to introducing personnel 

for inspections or repairs. 

Cleaning and degassing generally involves the following steps1 

1. Removing residual product with a vacuum truck; 

2. Lossening rust scale, if present, with high pressure water and 

removing debris; 

3. Washing the tank with high pressure water and detergents; and 

4. Rinsing the tank with water. 

The residual product constitutes a waste that, depending on the 

nature of the VOL stored in the tank, may have to be disposed of with 

conventional solid waste disposal techniques or as a hazardous waste in 

compliance with the requirements of the Resource Conservation and Recovery 

Act (RCRA). The washwater, again depending on the nature of the VOL 

stored, constitutes wastewater for treatment in conventional wastewater 

treatment systems, or sometimes hazardous waste for disposal in compliance 

with RCRA. Another degassing methodology involves the application of a 

sustained forced draft to the interior of the vessel for a sufficient 

period to evaporate all residual product. This technique generally 

involves no wastewater or hazardous solid waste disposal. However, air 

emissions do result. 

For the most part, tank degassing and the resultant waste impacts 

occur irrespective of the regulatory alternatives. On the average, 

tanks are cleaned, degassed and inspected on about a 10-year cycle. 

7-5 
7.4 ENERGY IMPACT 

The control technologies selected for the regulatory alternatives 

do not increase the power or other energy requirements of the VOL storage 

vessels. Therefore, no energy impacts are attributable to the regulatory 

alternatives. 

7.5 OTHER ENVIRONMENTAL CONCERNS 

7.5.1 Irreversible and Irretrievable Commitment of Resources 

The regulatory alternatives would not preclude the development of 

future control options nor would they curtail any beneficial use of the 

environment. No long-term environmental losses would result from the 

regulatory alternatives. 

7.5.2 Environmental Impact of Delayed Standards 

The only environmental impact associated with a delay in proposing 

and promulgating the standard would be an increase in VOC emissions from 

storage tanks attributable to the construction of new tanks. 

7-6 
7.6 REFERENCES 

1. Memorandum from J. L. Shumaker to W. Moody of TRW Environmental 

Division regarding Retrofit IRF and Degassing Costs, December 21, 

1982. 

7-7 
8. COST ANALYSIS 

This chapter summarizes the cost analysis data. Installed capital 

costs are presented in Section 8.1 for the types of equipment specified 

in the regulatory alternatives outlined in Chapter 6. For each type of 

equipment, cost estimates are presented for the range of tank sizes 

commonly employed in the storage of volatile organic liquids (VOL). 

Cost data also are presented for several control alternatives (external 

floating roof tanks and vapor control equipment) that are considered in 

Chapter 6 but that are not selected as regulatory alternatives. In 

addition to the cost estimates for individual tank size/control alternative 

combinations, the aggregate cost impacts from applying the regulatory 

alternatives to the model plants are estimated. Sections 8.1 through 8.4 

present estimates of the capital costs, annualized costs, and cost 

effectiveness for model terminal and model producer/consumer facilities. 

Model plants are discussed in detail in Chapter 6. 

All costs are calculated as average costs over the cost of the 

baseline control level presented in Section 3.3. For the purposes of 

the cost analysis presented in this chapter, all tanks with a capacity 

greater than or equal to 75 cubic meters (20,000 gallons) and storing a 

liquid with a true vapor pressure g~eater than or equal to 3.5 kilopascals 

(0.5 psia) are assumed to be affected by the regulatory alternatives. 

Because the model terminal and model producer/consumer facilities will 

not be used to evaluate the effectiveness of the regulatory alternatives 

in controlling emissions, no emission information is presented in this 

chapter. 

The cost analysis follows a prescribed approach. Capital costs, 

which represent the initial investment for control equipment and 

installation, are estimated based on vendor quotes and EPA documents. 

From these estimates, correlations and factors have been developed to 

approximate capital costs for the range of tank sizes commonly used in 

the industry. The capital cost is annualized by applying a capital 

recovery charge, which is based on an estimated equipment lifetime and 

the interest rate on the capital, and by adding costs for taxes and 
insurance. The total annualized cost, excluding product recovery credits, 

attributable to each regulatory alternative is estimated by adding 

operating costs to the annualized capital cost. The total annualized 

cost, including product recovery credits, is estimated by subtracting 

the value of the recovered product from the annualized costs. Cost 

effectiveness is the total annualized cost divided by the emission 

reductions obtained by applying each regulatory alternative. 

8.1 CAPITAL COSTS 

The capital costs for the regulatory alternatives are based on cost 

estimates obtained from industry vendors and EPA reports. 1•

2•3 Vendors 

were contacted and asked to provide estimates of the costs to construct 

fixed roof tanks, external floating roof tanks, and secondary seals, as 

well as the cost to install internal floating roofs in fixed roof tanks. 

(See Tables 8-1, 8-2, 8-3, and 8-4.) Internal floating roof cost data 

are based on a fourth-quarter 1982 survey of equipment manufacturer•s 

prices. Other cost estimates are based on data collected in a similar 

manner in late 1979 and early 1980. These estimates have been scaled 

based on Chemical Engineering general cost indexes4 to reflect secondquarter 1982 dollar estimates. All capital costs are at least equivalent 

to study estimates C:3o percent accuracy). 

The capital cost of an internal floating roof depends mainly upon 

the liquid surface area. Therefore, the capital costs for these devices 

are given only as a function of the tank diameter, which is directly 

related to surface area. The cost of a fixed roof tank, however, is a 

function of the volume capacity of the tank*. Tank and roof costs 

An estimating technique has been developed to relate tank volume to tank 

height and diameter and thereby aid the comparison of fixed roof tank costs 

to floating roof costs. The formula is based on the fact that tank heights 

generally increase in about 2.62 meter (8 foot) increments (due to the 

width of sheet steel) and that for other than small tanks, the height to 

diameter ratio rarely exceeds unity in industry practice. The formula, 

which has been used in the development of the capital cost tables, 

is as follows: 

Tank capacity (V) Tank height (H) Tank diameter (D) 

in cubic meters in meters in meters 

0-45 2.62 

46-91 5.25 0 = (4V)~ 

92-307 7.87 rrH 

308-1,136 10.5 

1,137-11,590 13.1 

>11,590 15.7 

8-2 
Tank 

volume, 

(m3) 

75 

150 

250 

500 

1,000 

5,000 

10,000 

Table 8-1. ESTIMATED INSTALLED C~PITAL COST 

OF A FIXED ROOF TANK ' 

(second-quarter 1982 dollars) 

Tank 

diameter, 

(m) 

4.3 

4.9 

6.4 

7.8 

11.0 

22.0 

31.2 

Tagkb 

cost ' 

($) 

13,300 

19,900 

26,700 

39,800 

59,400 

150,400 

224,300 

aEstimated from the equation: Cost ($1000) = 0.883 v0·

577 ; 

where, V = tank volume in cubic meters; with correlation 

coefficient r 2 >0.99. This equation yields -first-quarter 

1980 cost estimates that were scale~ by a factor of 1.25 to 

reflect second-quarter 1982 prices. 

bExcluding the cost of the foundation, land, etc. that are 

not affected by the regulatory alternatives. 

8-3 
co 

I 

+=-

Tank 

diameter, 

(m) 

5 

10 

15 

20 

25 

30 

Table 8-2. ESTIMATED INSTALLED CAPITAL COST OF A NONCONTACT INTERNAL FLOATING ROOF 3 

(fourth-quarter 1982 dollars) 

Cost with 

Cost with liquid-mounted 

liquid-mounted primary seal, 

Basic Cost with primary seal controlled deck 

roof liquid-mount0d and cant roll e~ fittings and d 

costa primary seal deck fittings secondary seal 

($) ($) ($) ($) 

6,280 6,320 6,320 7,620 

11,600 11,680 11,680 14,300 

17,000 17,120 17,120 21,000 

22,300 22,460 22,460 27,600 

27,700 27,900 27,900 34,400 

33,000 33,250 33,250 41,000 

aEstimated from the equation: Cost ($) = 1,069 D + 939; where, D = tank diameter in meters; with the 

correlation coefficient r2 = 0.889. This correlation generates installed cost estimates for an aluminum 

noncontact internal floating roof with a vapor mounted wiper type seal. 

bThe additional cost of the liquid-mounte~ primary seal over an elastomeric ~iper seal is estimated to 

be $2.60 per linear meter of circumference based on quotes from one vendor. 

cControlled deck fittings include a gasketed, bolted cover, access hatch; a gasketed, bolted cover 

automatic gauge float well; pipe columns with a flexible fabric sleeve seals; a gasketed sliding cover 

for the ladder well; a sample well with a split fabric seal and 10% open area; and a weighted, mechanical 

actuation, gasketed, vacuum breaker. Based on vendor estimates, the additional cost of controlled 

fittings over the cost of the normally installed deck fittings is negligible. 

dCost of secondary seal is estimated to be $85 per l~near meter of tank circumference. This is the 

average price of 13 seals from 8 different vendors. 
Table 8-3. ESTIMATED INSTALLED COST OF A WELDED ~ONTACT INTERNAL 

FLOATING ROOF WITH SECONDARY SEALS 

(fourth-quarter 1982 dollars) 

Tank 

diameter ~~~~a (m) ($) 

5 15,900 

10 30,000 

15 44,000 

20 58,100 

25 72,100 

30 86,100 

aThe basic cost of the roof and primary seal is estimated from the 

equation: cost ($1000) = 1.91 + 2.54D; where D equals the tank diameter 

in meters with the correlation coefficient r 2 = 0.883. The additional 

cost of a secondary seal is estimated based on the factor, $85 per linear 

meter of circumference. The secondary seal cost is the average price of 

13 seals from 8 different vendors. 

8-5 
Table 8-4. ESTIMATED INSTALLED CAPITAL COST 

OF EXTERNAL FLOATING ROOF TANKS WITH SECONDARY SEALS5•

6•7 

(second-quarter 1982 dollars) 

Tank Tank Tan~ b 

volume, diameter, cost ' 

(m3) (m) ($) 

75 4.3 22,100 

150 4.9 32,300 

250 6.4 42,300 

500 7.8 61,900 

1,000 11.0 89,900 

5,000 22.0 218,000 

10,000 31.2 319,000 

aCost of tank estimated from the equation: Cost ($1000) = 1.54 v0·

552

; 

where, V = tank volume in cubic meters; with the correlation coefficient 

r 2 = 0.98. This equation yields first-quarter 1980 cost estimates tijat 

were scaled by a 1.25 factor to reflect second-quarter 1982 dollars. 

bThe additional cost of the secondar~ seal is estimated to be $85 per 

linear meter of roof circumference. 

8-6 
are not related to the vapor pressure of the material stored in the 

range of products potentially affected by a VOL storage regulation (i.e. 

<~11 psia). For each type of equipment (i.e., internal floating roof, 

fixed roof tank, etc.) an equation of predicted capital costs was derived 

from the available data (vendor quotes). These equations are used in 

all subsequent cost analyses. 

Table 8-1 presents costs for fixed roof tanks. These are installed 

capital costs including the cost of materials, transportation, labor, 

testing, and other vendor-incurred costs associated with erection of the 

tank. The estimates assume that a suitable location and foundation are 

available. Examples of the costs that are excluded include the cost of 

land, providing utilities to the site, and a concrete foundation. Such 

costs are fixed and constant irrespective of possible regulations for 

VOL storage vessels. Since they do not affect the regulatory decisions, 

they are not considered in the cost analysis. 

Table 8-2 presents installed cost estimates for internal floating 

roofs with successively more stringent (i.e. lower emitting ) alternative 

equipment. As discussed in Chapter 4, noncontact roofs are constructed 

of primarily aluminum materials. The basic roof casted in the table is 

equipped with a single, vapor-mounted, wiper type, deck perimeter seal 

(primary seal). The next casted alternative is a liquid-mounted, resilient 

tube, primary seal in place of the vapor-mounted wiper type seal. The 

third alternative includes the liquid-mounted primary seal, but adds 

11 controls 11 to certain deck fittings. Deck fittings and the 11 controls 11 

for deck fittings are described in Chapter 3 and Chapter 4, respectively. 

Briefly, 11 controls 11 for deck fittings are gaskets for covers, sleeve 

seals for support columns and the use of a sample well with a split 

fabric seal in place of a slotted sample pipe. The installation and use 

of 11 controlled11 fittings has a negligible effect on the cost of the 

floating roof. The small additional cost of gaskets and seals C~$200) 

is offset by the savings from installing a sample well instead of a 

slotted sample pipe ($100 to $300). 8 Also, 11 controlled11 fittings are 

not expected to significantly increase operating costs of internal 

floating roofs. The final alternative casted in Table 8-2 combines all 

8-7 
the preceding alternatives. It includes a liquid-mounted primary seal, 

11 Controlled 11 deck fittings and a wiper type secondary deck perimeter 

seal (secondary seal). 

Table 8-3 presents the estimated installed cost of welded contact 

internal floating roofs (steel pan) with secondary seals. The primary 

seal included in these cost estimates is a metallic shoe seal, a liquidmounted resilient tube seal, or a wiper type seal. Vendor quotes for 

steel pan roofs with each of these seal types were correlated to produce 

an 11 average 11 or 11 typical 11 roof cost function (see Table 8-3). The roof 

is constructed of steel. Larger roof sizes include auxiliary pontoon 

flotation. 

Table 8-4 presents estimates of the installed capital cost of 

external floating roof tanks. It is important to realize that these 

costs include the tank shell in addition to the roof. The cost of 

control over the fixed roof tank baseline costs is the difference between 

the external floating roof costs (Table 8-4) and the fixed roof tank 

cost (Table 8-1) for equivalent tank sizes. The tanks costed in Table 8-4 

include primary and secondary seal costs. The primary seals are either 

liquid-mounted or vapor-mounted resilient tube seals. For external 

floating roof tanks, the location of the primary seal (i.e. vapor- or 

liquid-mounted) does not significantly affect the roof cost. 

The incremental cost of the control alternatives can be approximated 

from the estimates contained in Tables 8-1 through 8-4. The comparison 

of control qlternative costs, however, must be made for tanks of equivalent 

diameter or volume. Care must also be taken to ensure that comparisons 

are made between equivalent types of equipment, i.e., roof cost versus 

roof cost or tank cost versus tank cost. 

Tables 8-5 through 8-13 present the costs of applying Regulatory 

Alternatives I-V, the external floating roof control options, and the 

vapor control alternatives to the model terminal and the model 

producer/consumer facilities. The model plants are discussed in Chapter 6 

and described in Appendix D. Although the model plants contain a number 

of tanks (terminal, 48 tanks; producer/consumer, 11 tanks), the regulatory 

alternatives affect only a fraction of the respective tank populations. 

The majority of tanks are exempted on the basis of size and vapor 

8-8 
Table 8-5. COST OF REGULATORY ALTERNATIVE I* 

(fourth-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Inspection 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram VOC emssions reduction 

Model 

terminal 

56,000 

6,580 

2,240 

2,800 

560 

12,180 

7,530 

744 

Model 

producer/ 

consumer 

15,800 

1,860 

630 

790 

160 

3,440 

2,090 

714 

*Noncontact internal floating roof with a vapor-mounted primary seal. 

8-9 
Table 8-6. COST OF REGULATORY ALTERNATIVE II* 

(fourth-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Inspection 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram of VOC emissions reduction 

Model 

terminal 

56,600 

6,670 

2,260 

2,830 

570 

12,330 

7,480 

710 

Model 

producer/ 

consumer 

16,000 

1,890 

640 

800 

160 

3,490 

1,610 

395 

*Noncontact internal floating roof with a liquid-mounted primary seal. 

8-10 
Table 8-7. COST OF REGULATORY ALTERNATIVE III* 

(fourth-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Inspection 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram of VOC emissions reduction 

Model 

terminal 

56,600 

6,670 

2,260 

2,830 

570 

12,330 

7,190 

644 

Model 

producer/ 

consumer 

16,000 

1,890 

640 

800 

160 

3,490 

533 

87 

*Noncontact internal floating roof with liquid-mounted primary seal and 

gasketed deck fittings. 

8-11 
Table 8-8. COST OF REGULATORY ALTERNATIVE IV* 

(fourth-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Inspection 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram of VOC emissions reduction 

Model 

termi na 1 

71,830 

9,130 

2,870 

3,590 

720 

16,310 

11,010 

957 

Model 

producer/ 

consumer 

23,210 

3,050 

930 

1,160 

230 

5,370 

2,230 

326 

*Noncontact internal floating roof with liquid-mounted primary seal, 

secondary seal and gasketed deck fittings. 

8-12 
Table 8-9. COST OF REGULATORY ALTERNATIVE V* 

(fourth-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Inspection 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram of VOC emissions reductin 

Model 

terminal 

184,800 

22,400 

7,390 

9,240 

1,850 

40,880 

35,500 

3,040 

Model 

producer/ 

consumer 

90,800 

11,000 

3,630 

4,540 

910 

20,080 

16 '770 

2,330 

*Welded contact internal floating roof with liquid-mounted primary seal, 

secondary seal and gasketed deck fittings. 

8-13 
Table 8-10. COST OF EXTERNAL FLOATING ROOF TANKS WITH 

PRIMARY SEAL AND SECONDARY SEAL 

(second-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Inspection 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram of VOC emissions reduction 

aCosts above the baseline control cost. 

Model 

terminal 

150,920a 

18,420 

6,040 

7,550 

1,500 

33,510 

b 

b 

Model 

producer/ 

consumer 

47,210a 

5,900 

1,890 

2,360 

470 

10,620 

b 

b 

bExternal floating roofs do not reduce emissions beyond the baseline level. 

Therefore, no emissions reduction credits exist. Emissions rates for both 

the model terminal and the model producer/consumer are expected to increase. 

Consequently, cost effectiveness for the alternative is undefined. 

8-14 
Table 8-11. COST OF EXTERNAL FLOATING ROOF TANKS WITH 

LIQUID-MOUNTED PRIMARY SEAL AND SECONDARY SEAL 

(second-quarter 1982 dollars) 

Model 

Cost parameters terminal 

Capital cost 150,920* 

Annualized capital charges 18,420 

Annual taxes, insurance and 

administration 6,040 

Operating costs 

Maintenance 7,550 

Inspection 1,500 

Total annualized cost without 

product recovery credits 33,510 

Total annualized cost with 

product recovery credits 

@ $460/Mg 29,350 

Cost effectiveness in dollars per 

ton of VOC emissions reduction 3,250 

*Costs above the baseline control cost. 

8-15 

Model 

producer/ 

consumer 

47,210* 

5,900 

1,890 

2,360 

470 

10,620 

10,400 

21,990 
Table 8-12. COST OF VAPOR CONTROL BY INCINERATION TECHNIQUES 

(second-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

administration 

Operating costs 

Maintenance 

Labor 

Energy 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagram of VOC emissions reduction 

Model 

terminal 

631,000a,b 

114,000 

4,100 

31,600 

27,200 

4,900 

181,800 

c 

15,500 

Model 

producer/ 

consumer 

631,000a,b 

114,000 

4,100 

31,600 

27,200 

4,900 

181,800 

c 

20,700 

aCost estimates assume one incineration unit and saturator per facility 

(see Chapter 4). 

bBased on a first-quarter 19~0 estimate scaled by a 1.25 factor to reflect 

second-quarter 1982 prices. 

cBecause there are no recovery credits, the cost is equal to the total 

annualized cost without product recovery credits. 

8-16 
Table 8-13. COST OF VAPOR RECOVERY BY CARBON ADSORPTION TECHNIQUES 

(second-quarter 1982 dollars) 

Cost parameters 

Capital cost 

Annualized capital charges 

Annual taxes, insurance and 

Administration 

Operating costs 

Maintenance 

Labor 

Energy 

Total annualized cost without 

product recovery credits 

Total annualized cost with 

product recovery credits 

@ $460/Mg 

Cost effectiveness in dollars per 

megagrams of VOC emissions reduction 

Model 

terminal 

631 oooa,b 

' 

114,000 

4,100 

31,600 

45,000 

60,000 

255,000 

249,600 

21,280 

Model 

producer/ 

consumer 

631 oooa,b 

' 

114,000 

4,100 

31,600 

45,000 

60,000 

255,000 

250,970 

28,650 

aAssumes one unit per facility sized for 0.142 standard3

m

3

/s of saturated 

vapor diluted to 25% LEL for a total of 8.0 standard m /s. 

bBased on a first-quarter 1980 estim4te scaled by a factor of 1.25 to 

reflect second-quarter 1982 prices. 

8-17 
pressure. Four tanks (2 fixed roof and 2 floating roof tanks) are 

affected by the regulatory alternatives in the model producer/consumer 

plants. The model terminal has five affected tanks (4 fixed roof and 

1 floating roof tank). These tanks can be identified by inspection of 

Appendix D with an understanding of the baseline control level described 

in Section 3.3. The base capital cost of all storage vessels at the 

model terminal is 1.07 million dollars, and the base capital cost of 

storage vessels at the model producer/consumer plant is 0.25 million 

dollars. As mentioned previously, these costs do not include foundation 

costs, land costs or other costs that are not affected by the regulatory 

alternatives. 

The cost of a vapor control system is a function of the vapor flow 

rate to the system. This flow rate is controlled by the rate at which 

liquids are pumped into the tank and not by tank diameter or volume. No 

cost tables are presented for vapor recovery. The capital costs of 

installing a carbon adsorption or thermal oxidation vapor control system 

to reduce volatile organic compound (VOC) emissions from the model 

plants are estimated from information supplied by EPA reports. 1•

2 (See 

Tables 8-12 and 8-13.) It is assumed that each system is sized for a 

stream of saturated vapor at 0.142 standard cubic meters per second 

(0.142 standard m3 /s). Because of the large size of the vapor control 

systems, it is assumed that only one system is needed for each model 

facility. However, because of product compatibility or operating problems, 

actual facilities might need more than one unit; therefore, the cost 

estimates are almost certainly low. 

8.2 ANNUALIZED CAPITAL COSTS 

The capital cost for each regulatory alternative is annualized 

assuming the useful equipment lifetimes listed in Table 8-14. In estimating 

the annualized capital cost for the equipment, it is assumed the capital 

is borrowed at a 10 percent real interest rate. Based on the estimated 

equipment lifetimes and the assumed interest rate, annualized capital 

costs are estimated with the capital recovery factor method. 

8-18 
Table 8-14. LIFETIMES OF CONTROL EQUIPMENT 

Device Lifetime (yrs) 

Tank and floating roof 

Secondary seals 

Carbon adsorber 

Thermal oxidizer 

20 

10 

10 

10 

aCapital recovery factor determined by the equation: 

CRF = i(1 + i)n/(1 + i)n - 1; 

where i = the annual interest rate and 

n =the equipment lifetime. 

Capital 

Recove~y 

Factor 

0.11746 

0.16275 

0.16275 

0.16275 

Table 8-15. COST ANNUALIZING ASSUMPTIONS 

Item Charge 

Tax, insurance, and administration 4% of capital cost 

Maintenance 5% of capital cost 

Inspection 1% of capital cost 

Interest rate 10% 

Labor $16/hr 

Natural gas $3.00/109 J 

Electricity $0.04/kWh 

Energy other than natural gas or electricity $2.50/109 J 
8.3 ANNUALIZED COSTS 

The annualized cost without product recovery credits is calculated 

by adding the annualized capital charges to the costs for taxes, insurance 

and administration (4 percent of the capital costs) and the operating 

costs. Operating costs include the yearly maintenance charge of 5 percent 

of the capital cost, and an inspection charge of 1 percent of the capital 

cost. (See summary in Table 8-15.) The factors used to estimate the 

cost of taxes and administration (4 percent) and maintenance costs 

(5 percent) are based on operating experience of the Hydroscience Company. 9 

In respect to vapor control systems, utility expenses are estimated 

using electricity costs of $0.04 per kilowatt-hour, natural gas costs of 

$3.00 per 109 joules, and other energy costs of $2.50 per 109 joules. 

Emission monitoring costs were included in the annualized estimates for 

a flame ionization hydrocarbon detector at $4,500, for a flow measurement 

device at $2,500, and for bottled gas to operate the flame ionization 

detector at $2,625 per year. These monitoring costs were annualized for 

a charge of $3,750 per year. Additionally, it is assumed that 500 hours 

of operating labor at $16 per hour will be required to operate and 

maintain the emission monitoring system. 

The total annualized cost with product recovery credits is calculated 

by accounting for the value of any recovered product. The recovered 

product was casted based on a weighted average product value of roughly 

100 synthetic organic chemicals. A price of $460/megagram represents 

the weighted average product value (1978 average scaled to 1982 dollars 

with a factor of 1.55 based on the Chemical Engineering Journal Industrial 

Chemical Producer•s Price Index). The amount of recovered product was 

assumed equal to the emissions difference between the baseline emissions 

and each regulatory alternative, except for thermal oxidation. Because 

the thermal oxidation unit destroys VOC vapors, no recovery credits were 

assumed. 

8.4 COST EFFECTIVENESS 

The cost effectiveness of a regulatory alternative is defined as 

the cost per metric ton of VOC removed. The average product price of 

8-20 
$460/megagram was used in these calculations to quantify credits for 

recovered product that would be lost under the baseline conditions. The 

cost effectiveness values presented in Table 8-5 through 8-13 are in 

units of dollars per megagram of VOC determined by dividing the total 

annualized cost by the emission reduction achieved by a regulatory 

alternative or control technique. 

8.5 COST OF OTHER FEDERAL REGULATIONS 

There are a wide variety of Federal statutes that affect the 

manufacture and storage of volatile organic liquids. Table 8-16 lists 

12 Federal statutes that control human and environmental exposure to 

toxic chemicals. 10 The same statutes will also apply to volatile organic 

liquids (VOLs). Regulatory action required by these statutes controls 

the chemicals in products and wastes, ambient and occupational environments, 

chemical identification, chemical sources, and the handling, discharge, 

and ultimate disposal of chemicals. These regulations will cause an 

outlay of capital by the chemical manufacturing industry. Total spending 

for pollution control by the chemical industry in 1979 was expected to 

be $639 million. 11 Costs to specific segments of the industry, however, 

are difficult to distinguish on the basis of published data. The costs 

of the proposed regulations are difficult to estimate because of the 

lack of available information regarding the content of the final 

regulations. This section summarizes the available data on costs imposed 

upon the chemical manufacturing and storage industries by Federal 

regulations and discusses the impact of these costs on their operations. 

Regulatory statutes that apply to manufacturers and users of VOLs 

are listed in Table 8-17. This list includes the statutes from Table 8-16, 

in addition to several others, and briefly describes the provisions, 

requirements, and regulatory concerns of each statute. 12 The last 

column lists and describes the approximate costs of the statutes. In 

some cases, this column is blank because relevant cost data could not be 

found. Most of the costs available are for the general chemical industry 

and are not subdivided into costs for handlers of VOLs. However, 

Table 8-17 does show that these costs are considerable. Other indirect 

costs, such as the 11 abandonment 11 of new chemicals, and decreases in 

8-21 
Table 8-16. FEDERAL LAWS REGULATING TOXIC CHEMICALS 

Title 

Toxic Substance Control Act of 1976 

Food, Drug, and Cosmetic Act, as amended 

in 1976 

Occupational Safety and Health Act of 1980 

Consumer Product Safety Act of 1970 

Marine Protection, Research and Sanctuaries 

Act of 1972 

Federal Pesticide Act of 1978 

Clean Air Act, as amended in 1977 

Federal Water Pollution Control Act, 

amended as Clean Water Act of 1977 

Safe Drinking Water Act of 1974 

Resource Conservation and Recovery Act of 1976 

Hazardous Materials Transportation Act of 1970 

National Environmental Policy Act of 1969 

8-22 

Abbreviation Public Law No. 

TSCA 94-469 

FDCA 94-295 

OSHA 91-596 

CPSA 92-573 

Ocean Dumping 92-532 

FPA 95-396 

CAA 95-95 

FWPCA 92-500 

CWA 95-217 

SDWA 93-523 

RCRA 94-580 

HMTA 91-458 

NEPA 91-190 
Table 8-17. STATUTES THAT MAY BE APPLICABLE TO THE MANUFACTURE 

AND STORAGE OF VOLATILE ORGANIC LIQUIDS 

Statute 

Toxic Substances Control Act 

Food, Drug, and Cosmetic Act 

Occupational, Safety, and 

Health Act 

Consumer Product Safety Act 

Marine Protection, Research and 

Sanctuaries Act 

Federal Pesticide Act 

Clean Air Act and Amendments 

Applicable provision, regulation, or requirement of statute 

• Premanufacture notification • Labelling, recordkeeping • Reporting requirements • Toxicity testing 

• Consumer use of chemicals 

• Walking-working surface standards • Means of egress standards • Occupational health and 

environmental control standards • Hazardous material standards • Personal protective equipment 

standards • General environmental control 

standards • Medical and first aid standards • Fire protection standards • Compressed gas and compressed air 

equipment • Welding, brazing, and cutting 

standards 

• Consumer use of chemicals 

• Ocean dumping permits • Recordkeeping and reporting 

• Consumer use of chemicals 

• State Implementation Plans • Nationa: Emission Standards For 

Hazardous Air Pollutants • New source performance standards: 

Air oxidation 

Volatile organic liquid storage • PSD construction permits • Nonattainment construction permits 

(continued} 

8-23 

Approximate costs incurred 

• General reporting rule (Section S(a)) 

is expected to initially cost 

chemical manufacturers about 

$6 million. EPA estimates the cost 

will be $420 for each l~emical a manufacturer produces. 

• Costs for entire chemical industry 

projected to be $100-200 million per 

year. Preinventory notification 17 cost: $1,200-1,500 per chemical. 

• $220/year per worker. 18 

• About $256 million lost due to cance1latio~ or suspension of 

pesticides. 

• About $249 million spent by entire chemical ~ndustry for air pollution 

control. 
Statute 

Clean Water Act 

Safe Drinking Water Act 

Resource Conservation and 

Recovery Act 

Hazardous Materials 

1ransportation Act 

National Environmental Policy 

Act 

Coastal Zone Management Act 

Power Plant and Industrial 

Fuel Use Act 

Table 8-17. Concluded 

Applicable provision, regulation or requirement of statute 

• Discharge permits • Effluent limitations guidelines • New source performance standards • Control of oil spills and 

discharges • Pretreatment requirements • Monitoring and reporting _ • Permitting of industrial projects 

that impinge on wetlands or public waters • Environmental impact statements 

• Requires underground injection 

control permits 

• Permits for treatment, storage, 

and disposal of hazardous 

liquids. • Establishes system to track 

hazardous wastes • Establishes recordkeeping, 

labelling, and monitoring 

system for hazardous wastes • Superfund 

• Requires environmental impact 

statements 

• Allows states to veto Federal 

permits for plants to be sited 

in coastal zones 

• Prohibits new, major, industrial 

power plants, which utilize fuel 

oil or natural gas 

8-24 

Approximate costs incurred 

• Increased annual costs to pesticide manufacturers, caused by regulations, under Sections 301 and 304, 

would range between 0.2 and 2 

percent of the revenues from pesticide chemicals. Profitability 

would be reduc~B for some manufacturers. 

• Total annual cost of $243 million 

incurred by organic chemical, 

pesticide, and explosives industries 

to comply wi!§ EPA hazardous waste 

regulations. 

• Another source estimates 

$414 million total expenditure by 

entire chemical in~~stry for water 

pollution control. 

• Only one out of the more than 500 

surface dumps and landfills would 

meet RCRA standards. Over 

$1 bill~2n 2eeded to upgrade the 

others. ' 

• Proposed that $400 million of 

$6 billion superfund come from 

annual industry fees on oil, 

chemical, a2~ heavy metal 

industries. Part of fund would come from fee, not to exceed $5 

per ton on chemicals. Fund applies 

only to past disposal practices. 

• Waste disposal costs are expected 

to rise from $1.50-$5.00 per to24 to over $50 per ton under RCRA. 
innovation, productivity, job opportunities, and 11 incentive for 

entrepreneurial initiative, 11 are not easily quantified and are 

excluded. 13 •

14 In addition, health and economic benefits of the regulations 

are not considered. 15 

The economic impact of these regulations on the chemical industry 

is not fully quantified. The Council on Environmental Quality reported 

in 1979 that the economic health of this industry is better than most 

and that few plant closings are expected solely because of the costs of 

compliance with standards and regulations. 25 A 1978 study by EPA 1 s 

Office of Solid Waste Management found, with regard to regulations 

concerning hazardous wastes, that 11 Certain individual segments of the 

industry will be subject to more severe impacts than the industry as a 

whole, but no plant closures will result directly from the regulations." 26 

In contrast, a survey sponsored by the Chemical Specialties Manufacturers 

Association reported that 14 percent of the firms surveyed said that 

present and upcoming EPA regulations could cause them to close. Nine 

percent said that EPA rules could cause a change of ownership. The 

survey stressed that the greatest difficulty caused by the regulations 

would be increased operating costs, followed by reporting and recordkeeping 

requirements and increased capital costs. 13 Part of this discrepancy in 

the perceived impact of Federal regulations may be reduced through the 

efforts of the Interagency Regulatory Liaison Group (IRLG). The IRLG 

intends to strongly emphasize the coordination of regulations being 

developed by member groups and will also emphasize the economic analysis 

of the proposed regulations. Agencies participating in the IRLG include 

EPA, the Occupational Safety and Health Administration, the Consumer 

Product Safety Commission, the Food and Drug Administration, and the 

Food Safety and Quality Service. 27 

A list of currently proposed regulations that will affect the 

chemical industry is given in Table 8-18. 28 The economic impact of 

these regulations will be unclear until their final forms are determined 

from a number of regulatory alternatives. Studies of the economic 

effects of many of these regulations are underway at this time. 

8-25 
Table 8-18. PROPOSED REGULATIONS THAT WILL AFFECT THE CHEMICAL 

MANUFACTURING INDUSTRY 

Agency 

DOL-OSHA 

DOL-OSHA 

EPA-OANR 

EPA-OANR 

EPA-OANR 

EPA-OPTS 

EPA-OPTS 

EPA-OWWM 

(as listed in the Calendar of Federal Regulations) 

Title of regulation Page No. in calendar 

Chemical Warning Systems 68278 

Safety standard for walking and working 68283 

surfaces 

National Emission Standards for 68239 

Hazardous Air Pollutants- Benzene 

Policy and Procedures for Identifying, 68292 

Assessing, and Regulating Airborne 

Substances Posing a Risk of Cancer 

Regulations for the prevention of 68244 

significant deterioration resulting 

from hydrocarbons for carbon monoxide, 

nitrogen oxides, ozone, and lead 

Rules and notice forms for premanu- 68294 

facture notification of new chemical 

substances 

Standards and Rules for Testing of 68297 

Chemical Substances and Mixtures 

Hazardous waste regulations: Core 68299 

regulations to control hazardous solid 

waste from generation to final disposal 

8-26 
8.6 COSTS AND COST EFFECTIVENESS OF CONTROLS ON AN INDIVIDUAL TANK 

This section presents the costs and cost effectiveness of controlling 

an individual tank. The tank selected for analysis is the model tank 

presented in Chapter 4, Section 1. Emissions from the possible 

configurations of the model tank are presented in Table 4-2. The capital 

and annualized cost (without product recovery credits) of controls are 

presented in Table 8-19. Both the absolute cost effectiveness and the 

incremental cost effectiveness will be discussed. 

The absolute cost effectiveness is defined as the total annualized 

cost of a particular control option minus the value of product recovery 

credit (the difference yielding the net annualized cost), divided by the 

total emissions reduction achieved by going from no control to that 

control option. Incremental cost effectiveness is defined as the difference 

in net annualized cost between two control options, divided by the 

difference in emission reduction between the same two options. 

Table 8-20 presents the absolute cost effectiveness of building the 

model tank as a new internal floating roof tank in place of a fixed roof 

tank. Table 8-21 presents the incremental cost effectiveness of controlling 

seal emissions from an internal floating roof. Table 8-22 presents the 

incremental cost effectiveness of controlling deck seam emissions by the 

use of welded decks. Consistent with the assumption used previously in 

this chapter, the cost of controlling fittings is assumed to be zero; 

the cost effectiveness of these controls is, therefore, zero. Based on 

the above information, Table 8-23 presents the incremental cost 

effectiveness between the regulatory alternatives. Because it is possible 

to replace a fixed roof tank with an external floating roof, an analysis 

of the internal floating roof equipment requirements of the regulatory 

alternatives was made relative to an external floating roof tank with a 

mechanical shoe seal and a secondary seal. Table 8-24 presents the 

incremental cost effectiveness of building the model tank as an external 

floating roof tank with a mechanical shoe primary seal and a secondary 

seal instead of the equipment required by each regulatory alternative. 

8-27 
1. 

2. 

3. 

4. 

5. 

6. 

Table 8-19. CAPITAL AND ANNUALIZED COSTS FOR BASELINE AND CONTROL 

EQUIPMENT FOR THE MODEL VOL TANK 

Capital Cost Annualized Cost 

Item ($) ($) 

Fixed roof tank 35,600 7,750 

External floating roof tank 52,900 11,500 

with mechanical shoe primary 

seal only 

Bolted deck 10,700 2,330 

Welded deck 25,100 5,460 

Secondary seal for internal or 2,440 640 

external floating roof tank 

Liquid-mounted primary seal 75 17 

8-28 
Table 8-20. ABSOLUTE COST EFFECTIVENESS OF CONTROLLING FIXED ROOF 

TANK EMISSIONS FROM THE MODEL TANK 

Emissions Cost Effectiveness 

Tank Type/Equipment (Mg/yr) ($/Mg) 

I. Fixed roof tank 6.22 1 

II. Internal floating roof tank 

A. Bolted deck, vapor- 0.41 41 

mounted primary seal, 

uncontrolled fittings 

B. Bolted deck, liquid- 0.34 39 

mounted primary seal, 

uncontrolled fittings 

c. Bolted deck, liquid- 0.24 32 

mounted primary seal, 

controlled fittings 

0. Bolted deck, liquid- 0.21 137 

mounted primary seal 

and secondary seal, 

controlled fittings 

E. Welded deck, liquid- 0.17 650 

mounted primary seal 

and secondary seal 

controlled fittings 

III. External floating roof tank 0.068 390 

with mechanical shoe 

primary seal and secondary 

seal 

1Not applicable. 

8-29 
00 

I 

w 

0 

Base Case 

Vapor-mounted 

Liquid-mounted 

1Not applicable. 

Table 8-21. INCREMENTAL COST EFFECTIVENESS BETWEEN INTERNAL 

FLOATING ROOF SEAL TYPES IN THE MODEL TANK 

End Case 

Vapor-mounted with Secondary Liquid-mounted Liquid-mounted with Secondary 

($/Mg) 

7,640 

1 

($/Mg) 

credit 

1 

($/Mg) 

6,840 

23,400 
Table 8-22. INCREMENTAL COST EFFECTIVENESS OF CONTROLLING 

DECK SEAM EMISSIONS IN THE MODEL TANK 

Base Case End Case 

Bolted deck Welded deck 

8-31 

Incremental 

Cost Effectiveness 

($/Mg) 

77,900 
00 

I 

w 

N 

0 

2 -

Table 8-23. REGULATORY ALTERNATIVES AND INCREMENTAL COST EFFECTIVENESS ($/Mg) 

BETWEEN REGULATORY ALTERNATIVES IN THE MODEL TANK 

Regulatory Alternative 

I II III IV 

($/Mg) ($/Mg) ($/Mg) ($/Mg) ($/Mg) 

v 

FR 41 biFRvm credit biFRlm 0 biFRlm,cf 23,400 biFRlm,ss,cf 77,900 IFR w lm,ss,cf 

- - 1Hotation is as follows: 

FR = fixed roof tank 

IFR = internal floating roof tank 

b = bolted deck 

w = welded deck 

lm = liquid-mounted primary seal 

vm = vapor-mounted primary seal 

ss = secondary seal 

cf = controlled fittings 

2Ho controls required. 

- - -
Table 8-24. INCREMENTAL COST EFFECTIVENESS BETWEEN EQUIPMENT 

SPECIFIED BY EACH REGULATORY ALTERNATIVE AND AN EXTERNAL 

FLOATING ROOF TANK WITH A MECHANICAL SHOE SEAL AND A SECONDARY SEAL 

Regulatory alternative 

as base case Emission reduction 

Equipment1 Number 

0 FR 

I biFRvm 

II biFRlm 

III biFRlm,cf 

IV IFR b lm,ss,cf 

v IFR 

w lm,ss,cf 

1Notation is as follows: 

FR = fixed roof tank 

IFR = internal floating roof tank 

EFR = external floating roof tank 

b = bolted deck 

w = welded deck 

lm =liquid-mounted primary seal 

vm = vapor-mounted primary seal 

ms = mechanical shoe primary seal 

ss = secondary seal 

cf =controlled fittings 

(Mg) 

6.15 

0.34 

0.27 

0.17 

0.14 

0.10 

Cost effecti~eness 

($/Mg) 

390 

5,700 

7,210 

11,700 

9,660 

NA3 

2

The annualized cost without product recovery credit is calculated as 

follows: 

Annualized cost= (cost of external floating roof tank+ cost of 

secondary seal) - (cost of fixed roof tank+ cost 

of controls). 

3Regulatory Alternative V is more expensive than the EFR control option. 

Therefore, cost effectiveness is undefined. ms,ss 

8-33 
8.7 REFERENCES 

1. Basdekis, H. S. Emissions Control Options for the Synthetic Organic 

Chemicals Manufacturing Industry; (draft document submitted to 

EPA). Hydroscience, Inc. Knoxville, Tennessee. February 1980. 

100 p. 

2. Blackburn, J. W. Emissions Control Options for the Synthetic 

Organic Chemicals Manufacturing Industry; (draft document submitted 

to EPA). Hydroscience, Inc. Knoxville, Tennessee. December 1979. 

120 p. 

3. Memoranda from Shumaker, J.L. to Moody, W. of TRW Environmental 

Protection Agency, dated October 11, 1982. Summarizing cost data 

from 11 equipment manufacturers and the correlation of data into 

general equipment cost equations. 

4. 11 Economic Indicators 11 Chemical Engineering, May 19, 1980, January 

22, 1980, and October 4, 1982. 

5. Telecon. Hyatt, Terry, Pittsburgh, Des Moines with Rockstroh, Margaret, 

TRW. May 19, 1980. Costs of cone roof tanks, external floating-roof 

tanks, and secondary seals. 

6. Letter from Rutland, McBarnett, GATX, to Guidetti, R., TRW. 

December 3, 1979. Costs for external floating-roof tanks and cone 

roof tanks. 

7. Telecon. Stilt, George, Pittsburgh Des Moines with May, George, 

TRW. April 10, 1980. Costs of external floating roof tanks and 

secondary seals. 

8. Memorandum regarding internal floating roof deck fittings costs 

from J. Shumaker toW. Moody, TRW Environmental Division, Research 

Triangle Park, NC. November 8, 1982. 

9. Erickson, 0. G. Draft Storage and Handling Report; Emission Control 

Options for the Synthetic Organic Chemicals Manufacturing Industry. 

Hydroscience, Inc. prepared for the U.S. Environmental Protection 

Agency, Research Triangle Park, NC. Contract No. 68-02-2577. 

October 1978. 

10. Unit Process Guide to Organic Chemical Industries, Vol. 1. Science 

Publishers, Inc. Ann Arbor, Michigan. 

11. News Flashes. Chemical Engineering. 86:12. 1979. p. 77. 

12. U.S. Environmental Protection Agency. VOC Fugitive Emissions in 

Synthetic Organic Chemicals Manufacturing Industry- Background 

Information for Proposed Standards; (Preliminary draft). Research 

Triangle Park, North Carolina. March 1980. p. 8-25, 8-26. 

8-34 
13. Chemical Specialties Manufacturers Cite EPA as Having Biggest 

Economic Effect. Chemical Regulation Reporter. November 2, 1979. 

p. 1317. 

14. Jellinek Says EPA Will Use Authority to Compel Disclosure of PMN 

Information. Chemical Regulation Reporter. January 11, 1980. 

p. 1586. 

15. Nader Group Scores Industry Figures on Costs, Benefits of Health 

Regulations. Chemical Regulation Reporter. October 12, 1979. 

p. 1107. 

16. EPA Estimates TSCA Reporting Role Would Cost Chemical Industry $6 Million. Chemical Regulation Reporter. Bureau of National 

Affairs, Inc. January 11, 1980. p. 1585. 

17. Proprosal of Premanufacture Notification Notice Form and Provision 

of Rules 40 CFR, Part 720.44(201). Washington, D.C. U.S. Government 

Printing Office. October 16, 1979. 

18. Arthur Anderson and Co. Cost of Government Regulation Study. 

Washington, D.C. March 1979. 

19. Cost of Pesticide Cancellations, Suspensions 11 Nominal, 11 EPA Report 

Says. Chemical Regulation Reporter. February 29, 1980. p. 1794. 

20. EPA Water Act Regulations for Pesticide Industry Upheld. Chemical 

Regulation Reporter. May 18, 1979. p. 220-221. 

21. RCRA Waste Disposal Discussed. Chemical Regulation Reporter. 

April 27, 1979. p. 93. 

22. Union Carbide Sees $2 Billion Price to Upgrad~ Storage Ponds Under 

RCRA. Chemical Regulation Reporter. April 27, 1979. p. 98. 

23. Government Considers $6 Billion Fund. Chemical Regulation Reporter. 

May 4, 1979. p. 119. 

24. Disposal Costs for Handling Wastes Outlined by Consultant at 

Conference. Chemical Regulation Reporter. September 21, 1979. 

p. 982. 

25. Environmental Quality, The Ninth Annual Report of the Council on 

Environmental Quality. Council on Environmental Quality. 

Washington, D.C. December 1978. 

26. Study Reports Costs of Complying with Anticipated EPA Regulations. 

Chemical Regulation Reporter. 1978. p. 272. 

27. Economic Analyses, Coordination to be Emphasized by IRLG in 1980-1981. 

Chemical Regulation Reporter. January 11, 1980. p. 1590. 

28. Calendar of Federal Regulations. Federal Register, 44:230. 

November 29, 1979. 

8-35 
9. ECONOMIC IMPACT 

9.1 INDUSTRY PROFILE 

9.1.1 Introduction 

The industry profile describes the economic characteristics of industries 

that store volatile organic liquids (VOLs). Its purpose is to provide background infor~ation necessary to formulate and execute the economic impact 

analysis of Section 9.2. The discussion begins by identifying and describing 

the industries of interest: those involved in VOL production, VOL consumption, and VOL storage at merchant terminals. Information on the basic supply 

and demand conditions of these industries, including production and sales 

levels and inputs into their production activities, is presented in the basic 

conditions subsection. Three subsections are then devoted to a discussion of 

the structure, conduct, and performance of firms in the three industry segments of interest.* The section concludes with a presentation of the methodology and results for projecting the nationwide VOL storage tank population 

for the 1984-1988 period. 

9.1.2 Identification and Description of VOL-Storing Industries 

9.1.2.1 VOL Producers. Figure 9-1 is a flowchart of the organic chemicals industry from raw feedstocks to end products. VOL manufacturers are 

part of this industry, which is complex because many chemicals it manufactures 

subsequently are used to produce other chemicals. Hegman, for example, estimates that intraindustry shipments constitute as much as two-thirds of total 

sales in the organic chemical industry. 2 This phenomenon frequently results 

in double counting of the output of primary and intermediate chemicals and 

hampers accurate measurement of production and sales. 

Manufacturers of VOLs are classified in the three-digit standard industrial classification (SIC) code 286, Industrial Organic Chemicals. This 

*For the benchr.~rk definition of these terms and their role in economic 

analysis, see Reference 1. 
\.0 

t 

I') 

I 

Coal ~ 

I 

Feedstock Primary Organic 

Chemical• 

r.troleunt Ethylen• 

Pro1tylent 

. Naphtha 

Gas Oil 

Coal Tar, Butadiene 

light 011 

Benune 

Ethane 

Propane 

Butane 

p·Xylene 

Lr Methanol 

Natural 

Gas 

I 

rlalllclllll 

Oy•ttirlft 

and 

Plgmef111 

Industrial 

~ 0fgenlc 

Chemicals 

Solventl 

Rubber 

Procenlng 

Chemlcela 

Pesllcldn 

I J I 

Organic Chamle~~l Malor Constrmlno End Use 

Products lndunrleo 

rer.h•olnu. 

llulhllno onol 

Comlrur.llun, 

lrllnt,mtlnlluu, 

lltUIIWWArttl, 

Furniture, and 

AtlllllftiiCet 

Apparel, 

Uphohtery 

Fabric, 

Tire Cord 

Industrial end 

Consumer 

Cleaning 

Compound• 

Tires, 

Belting, Hote 

Ethical and 

Proprietary 

Drugs 

Crops 

Figure 9-1. Organic chemical industry flow chart. 2 
category also includes establishments primarily engaged in the manufacture of 

some nonvolatile and solid chemicals. For example, SIC 286 includes establishments prim~rily engaged in the manufacture of fabricated rubber and explosives. 

While establishments primarily engaged in the manufacture of industrial 

organic chemicals are classified in SIC 286, establishments classified in 

other SIC industries produce these chemicals as secondary products. Approximately 20 percent of all industrial organic chemicals are produced in establishments not classified in SIC 286. 3 

9.1.2.2 VOL Consumers. Industries in SIC 28, Chemicals and Allied 

Products, consume the largest amount of VOLs. The largest consuming industry 

is also the producing industry: SIC 286, Industrial Organic Chemicals. Other 

important consuming industries are SIC 282, Plastics Materials and Synthetics; 

SIC 283, Drugs; SIC 284, Soaps, Cleaners, and Toilet Goods; and SIC 287, 

Agricultural Chemicals. Booz, Allen, and Hamilton, Inc., conducted a survey 

of organic emissions to identify which consuming industries store significant 

amounts of VOLs. The survey indicates that industrial organic chemical producers, who in most cases are also VOL consumers, accounted for 64 percent of 

VOL emissions from storage tanks. 4 It also indicates that an additional 20 

percent of all VOL emissions from storage tanks within the chemical industry 

originated in SIC 282, Plastics Materials and Synthetics. Other consuming 

industries each generate less than 5 percent of storage tank emissions and are 

not considered further here. 

Flows of industrial organic chemicals are traced from SIC 286, Industrial 

Organic Chemicals, to other industries, based on U.S. Department of Commerce 

1972 input/output tables. 5 * Major consumers of industrial organic chemicals 

not included in SIC 28 are SIC 22, Textile Mill Products; SIC 30, Rubber and 

Miscellaneous Plastics Products; and SIC 24, Lumber and Wood Products. The 

major types of chemicals provided to these users are dyes, lakes, toners, 

creosote oil, rubber-processing chemicals, and plasticizers. Shipments of 

*Industrial organic chemicals are included in two input/output commodity 

groups: Industrial Organic and Inorganic Chemicals, and Gum and Wood 

Chemicals. The commodity-by-commodity input/output table lists the percentage of total U.S. output of the above chemicals consumed by producers of 

other co~~odities. Any commodity that accepted 1 percent or more of the flow 

of output of either industrial organic and inorganic chemicals or gum and 

wood chemicals was included in the 1972 Census of Manufactures under the 

appropriate industry group. Data on consumpt1on of industr1al organic 

chemicals appear in the input/output table on materials consumed by kind. 

9-3 
these products amounted to $701 million in 1972, or about 6.1 percent of total 

industry shipments from SIC 286. 6 Because the amount is so small, storage of 

chemicals outside of SIC 28 has been disregarded. 

Another user is SIC 516, Wholesale Trade of Chemicals and Allied Products, 

whose establishments purchase chemicals for repackaging and reselling. Industry contacts indicate that the storage tanks used by distributors typically 

have less than 75 m3 capacity. 7 Because this capacity is less than the cutoffs considered under each regulatory alternative, this profile does not 

include wholesale distributors. 

9.1.2.3 VOL Storage Terminals. Data on storage services are difficult 

to collect for three reasons. First, most of the small private-merchant 

terminals that store VOLs do not report financial data publicly. Second, many 

of the larger publicly traded companies aggregate data on chemical storage 

services with data from other accounting units or with data from storage of 

other commodities, making it impossible to assess the financial and economic 

performance of VOL storage enterprises from a specific SIC code. Data on 

chemical storage services are included in SIC 4226, Special Warehousing and 

Storage Not Elsewhere Classified, along with data on merchant warehousing of 

other commodities such as petroleum, whiskey, and furs. Thus, data reported 

for this category in the 1972 Census of Business Services do not represent 

chemical storage services as such. Furthermore, because establishments are 

classified by their primary functions and because chemical storage is usually 

a secondary function, data on much of the chemical storage industry are contained in SIC industry categories other than SIC 4226. Proprietary or captive 

terminals, if used as storage points rather than as wholesale distribution 

centers, are classified as auxiliary establishments for which no revenues or 

other statistics are reported. 

For this report, information on bulk chemical storage was obtained from a 

trade association, the Independent Liquid Terminals Association (ILTA). Members of this organization range from a merchant terminal operator with 1 terminal comprised of 7 tanks to an operator with 14 terminals and a total of 

1,469 tanks. Few terminal operators report revenues or other statistics and, 

of those who do, statistics for chemical storage are combined with statistics 

for other operations. 8 For specific information, nine liquid terminal operators were contacted. No statistics were collected on proprietary terminals. 

9-4 
9.1.3 Basic Conditions 

This section addresses supply conditions, which are determined largely by 

technological considerations, and demand conditions, which depend primarily on 

product attributes. 

9.1.3.1 Supply Conditions. Employment, assets, and costs of materials 

for industrial organic chemicals between 1972 and 1977 are provided in Table 

9-1. Total e:nployment in the industrial organic chemical industry increased 

about 12 percent over this 5-year period. Assets also have increased since 

1972. Expenditures on materials have tripled, largely because of the increased 

cost of petroleum-based raw materials. 

Resource use in Plastics Materials and Synthetics (SIC 282) is presented 

in Table 9-2. In contrast to the industrial organic chemical industry, this 

industry is becom.ing more capital intensive. Total employment fell by almost 3 

percent between 1972 and 1977, and the number of production workers declined 

by over 4 percent. Over roughly the same period, the value of assets increased 

38 percent. Between 1972 and 1977, expenditures on materials increased dramatically, by over 130 percent, primarily because of increased fuel and feedstock 

prices. 

Capital ex~enditures and operating rates for the VOL-producing and VOLconsuming industries are presented in Table 9-3, in both current and constant 

dollars, for the years 1958 to 1978. Expenditures by VOL producers declined 

for some years prior to 1972. When oil prices increa_sed sharply in 1973, 

expenditures started to grow again in real terms, rising by almost 200 percent 

over 5 years. A trade survey indicated that these new expenditures were for 

improvements in old plants and process efficiency gains rather than for new 

capital assets. 1 ° Capital expenditures in SIC 282, Plastics Materials and 

Synthetics, have increased steadily since 1958 as demand for plastics has 

grown. The most dramatic growth occurred after 1973, when plastics and resins 

companies began large expansion programs, after which expenditures declined as 

companies invested in process improvements. 

9.1.3.2 Demand Conditions. 

9.1.3.2.1 VOL producers and consumers. Demand for VOL storage services 

depends upon demand for VOL chemicals and upon the inventory and distribution 

practices of VOL producers and consumers. VOL producers and consumers choose 

to hold inventories, onsite or in terminals, to facilitate production and 

9-5 
TABLE 9-1. RESOURCE USE BY PRODUCERS OF 

INDUSTRIAL ORGANIC CHEMICALS (SIC 286) 9 

Production Cost of a 

Employment workers materials ,b Assetsa,b 

Year (103 ) (103 ) ($106 ) ($106 ) 

1972 136.5 87.9 5,514.4 12,490.9 

1973 137.8 89.2 6,488.4 13,258.9 

1974 135.2 88.2 10,608.8 14,068.3 

1975 137.3 86.4 11,765.7 16,360.3 

1976 141.8 90.3 14,713.9 18,972.9 

1977 152.8 97.9 17,607.7 N/A 

aCurrent dollars. 

bThe adjective "current" or "nominal" describes the measurement of an economic 

magnitude in current prices; i.e., prices pertaining to the year in question. 

When current or nominal values are compared for different years, no account 

is taken of general price inflation or deflation. By contrast, the adjective 11 real" or 11 constant 11 refers to attempts to measure economic magnitudes by 

the quantity of real goods and services they command; i.e., with the general 

rate of inflation deducted to record the real command over resources. 

9-6 
TABLE 9-2. RESOURCE USE BY PRODUCERS OF 

PLASTICS MATERIALS AND SYNTHETICS (SIC 282) 9 

Production Cost of 

Employment workers material sa Assets a 

Year (103 ) (103 ) ($106 ) ($106 ) 

1972 161.9 116.0 4,854.9 9,468.5 

1973 164.1 118.6 5,310.6 10,090.6 

1974 169.8 121.8 8,521.9 11,268.3 

1975 150.3 104.0 8,591.7 12,220.3 

1976 152.8 107.0 10,687.5 13,047.7 

1977 157.1 111.1 11,552.6 N/A 

a Current do 11 ars. 

9-7 
TABLE 9-3. CAPITAL EXPENDITURES AND OPERATING RATES FOR 

SIC 286 AND SIC 282, 1958-1978 

Implicit price Ca~ital ex~enditures {$106 ) 

deflator, gross SIC 286 SIC 282 Operating rates 

private fixed Constant Constant for SIC 28, 

investments A 

nonresidential 

Currentb 

dollars dollar~ (1972) 

Currentb 

dollars dollar~ 

(1972) 

percentage of d 

nameplate capacity 

1958 70.6 413.2 585.3 112.3 159.1 

1%9 72.0 314.0 436.1 91.2 12G. 7 

1960 72.2 405.9 562.2 147.0 203.6 

1961 71.8 457.2 636.8 206.8 288.0 

1962 72.3 353.4 488.8 186.9 258.5 

1963 72.9 513.4 704.3 240.7 330.2 

1964 73.6 738.0 1,002. 7 270.6 367.7 

1965 74.5 737.5 989.9 472.0 731.8 

1966 76.8 981.2 1,277.6 515.8 671.6 

1967 79.3 937.9 1,182.7 436.5 550.4 

1.0 

I 1968 82.6 997.8 1,208.0 381.0 461.3 85 

(X) 

1969 86.6 861.4 994. 7 409.0 472.3 84 

1970 91.3 1,030.2 1,128.4 396.7 434.5 80 

1971 96.4 949.5 985.0 453.5 470.4 81 

1972 100.0 831.6 831.6 693.9e 693.9e 85 

1973 103.8 1,005.6 968.8 829.8 799.4 88 

1974 115.3 1,689.4 1,465.2 1,327.4 1' 151.3 81 

1975 132.3 2,119.8 1,602.3 1,439.5 1,088.1 78 

1976 138.7 2,684.4 1,935.4 1,368.6 986.7 78 

1977 146.0 3,510.9 2,404. 7 1,271. 0 870.5 76 

1978 -- -- -- -- -- 83 

a bReference 11. 

cReferences 12, 9. 

dConstant dollars calculated by dividing current dollars by the price deflator and multiplying by 100. 

Reference 13. 

eBeginning in 1972, a category (Plastics Materials) was reclassified into SIC 282, causing the series 

prior to 1972 to be inconsistent with the series from 1972 to 1977. 
sales; i.e., they accept the cost of holding some VOL inventory in exchange 

for improved c~erating productivity and sales. For both producers and consumers, inve~tories are held in bulk due to economies of scale in storage. 

Table 9-4 presents data on production and sales of industrial organic 

chemicals fer ~he period 1955 to 1981. Production of industrial organic chemicals increased at an average annual rate of 6 percent from 1955 to 1974. 

However, fol1owing the sharp rise in oil prices in 1974 and the decreasing 

demand for cheoicals during the 1975 recession, 1975 production declined to 85 

percent of the previous year 1s output. Production declined again slightly in 

1976 as producers and consumers both tried to reduce inventories. With economic recovery, production of industrial chemicals increased, rising to 90 percent of the 1974 output in 1978 and surpassing the 1974 level thereafter. 

Physicai sales followed a similar pattern, increasing at a 6 percent 

average annual growth rate from 1955 to 1973. However, rapidly increasing 

feedstock prices in 1974 resulted in higher chemical prices. In 1975, the 

physical sales volume dropped to 80 percent of 1973 levels, as the impact of 

higher real prices was compounded by the 1975 recession. Physical sales 

further declined in 1976 to 77 percent of their 1973 level, began to grow 

~gain in 1977, and rose in 1978 to 83 percent of the 1973 peak. The 1973 peak 

was matched in 1979, but physical sales weakened again in 1980 and 1981. Phy~ 

sical sales of industrial organic chemicals consistently have represented about 

50 percent of production over the period 1955 to 1978. The other 50 percent 

is ·captively consumed. 

Between 1S73 and 1981, current dollar sales increased much more rapidly 

than did output and physical sales volumes. In some years, dollar sales 

increased as chemical prices rose even though production and physical sales 

volumes decreased. Dollar sales increased over 50 percent in 1974, while the 

physical sales volume fell 3.7 percent. Revenues changed very little as the 

volume of physical sales fell sharply between 1974 and 1975. In 1976, dollar 

sales began ~o grow again. 

Table 9-5 contains production and sales data for plastics and resins 

materials, the largest VOL consumer. From 1955 to 1973, production and physical sales grew at an annual average of over 10 percent. In 1974, sharply 

rising prices for raw materials reduced output by 15 percent although the 

physical sales volume grew by over 11 percent. In 1975, physical sales fell 

9-9 
Year 

1955 

1956 

1957 

1958 

1959 

1950 

1961 

1962 

1963 

1965 

1965 

1966 

1967 

1968 

1969 

1970 

1971 

1972 

1973 

1974 

1975 

1976 

1977 

1978 

1979 

1980 

1981 

TABLE 9-4. HISTORICAL PRODUCTION AND SALES ~F 

INDUSTRIAL ORGANIC CHEMICALS, 1955-198114 

Ratio of 

b PhysicBl physical 

Production sales sales to 

(106 Mg) (106 Mg) production 

23.5 11.9 50.6 

27.8 12.6 45.3 

26.7 12.7 47.6 

24.9 11.9 47.8 

25.0 12.3 49.2 

27.1 12.9 47.6 

27.6 13.4 48.6 

30.1 14.2 47.2 

32.5 15.1 46.5 

36.3 17.5 48.2 

40.1 19.0 47.4 

44.3 20.8 46.9 

45.7 21.7 47.5 

51.4 24.7 48.0 

56.8 27.4 48.6 

57.8 28.1 47.5 

57.7 28.6 46.3 

65.6 33.3 50.8 

69.9 36.2 51.8 

71.8 34.9 48.6 

61.0 29.0 47.5 

61.9 27.9 45.1 

61.2 29.1 47.5 

64.6 30.0 46.4 

82.1 36.3 44.2 

77.8 34.9 44.9 

77.5 33.8 43.6 

Doll ab c 

sales ' 

($106 ) 

2,811 

3,008 

3,097 

3,039 

3,498 

3,672 

4,040 

4,082 

4,210 

4,697 

5,182 

5,762 

6,359 

7,047 

7,277 

7,381 

7,592 

8,558 

10,049 

15,245 

15~355 

16,455 

17,945 

19.397 

26,007 

29,057 

30,995 

2

These data reflect some double counting due to the interindustry trade 

balready noted. 

These figures are developed by aggregatir.g data in the following 

International Trade Commission industrial categories: tar, tar crudes, 

cyclic intermediates, dyes, lakes and toners, flavor and perfume materials, 

rubber-processing chemicals, plasticizers, pesticides, miscellaneous end-use 

chemicals, and miscellaneous cyclic and acyclic chemicals. Prior to 1975, 

data on chemicals in the latter category were reported as Miscellaneous 

Synthetic Organic Chemicals. Figures for 1976 through 1978 are not strictly 

comparable to figures for other years due to a change in one product classification. The original classification was restored in 1979. 

cDollar sales are presented in current dollars. 

9-10 
Year 

1955 

1956 

1957 

1958 

1959 

1960 

1961 

1962 

1963 

1964 

1965 

1966 

1967 

1968 

1969 

1970 

1971 

1972 

1973 

1974 

1975 

1976 

1977 

1978 

1979 

1980 

1981 

TABLE 9-5. HISTORICAL PRODUCTION AND SALES OF 

PLASTICS AND RESINS MATERIALS, 1955-198114 a 

Ratio of 

b PhysicBl physical 

Production sales sales to 

(106 Mg) (106 Mg) production 

2.6 2.4 92 

2.9 2.6 90 

3.0 2.7 90 

3.1 2.8 90 

3.9 3.5 90 

4.1 3.6 88 

4.3 3.9 91 

5.0 4.5 90 

5.5 4.7 85 

6.1 5.3 87 

6.9 5.9 86 

7.9 6.8 86 

8.0 6.9 86 

9.4 8.2 87 

10.7 9.0 84 

10.7 9.5 89 

11.7 10.2 87 

14.0 12.3 88 

16.4 14.6 89 

13.9 16.3 117 

13.4 11.3 84 

15.9 12.9 81 

18.3 15.4 84 

20.2 16.9 84 

21.7 18.5 85 

19.5 16. 7 86 

20.6 17.9 87 

Dollar; c 

sales ' 

($106 ) 

1,651 

1,730 

1,811 

1,819 

2,333 

2,351 

2,427 

2,658 

2,770 

2,930 

3,346 

3,658 

3,547 

3,880 

4,235 

4,298 

4,541 

5,353 

6,644 

9,416 

8,461 

10,148 

12,822 

14,224 

17,705 

18,291 

19,597 

a These data reflect some double counting due to the interindustry trade 

already noted. 

bThese figures are based on the summation of two International Trade 

Commission categories: plastics and resins materials, and elastomers 

(synthetic rubber). 

cDollar sales are presented in current dollars. 

9-11 
by 30 percent as price increases and the 1975 recession sharply reduced demand 

for plastics and resins. Manufacturers reduced 1975 production by only 3.6 

percent, howeve;, allowing inventories to increase. In 1976, the physical 

sales volume increased again as general economic activity in the United States 

began to rise. Physical sales continued to grow in 1977 and exceeded the previous (1974) pe~k level from 1978 through 1981. 

Dollar sales of plastics and resins grew 14.3 percent annually between 

1975 and 1978 as producers of automobiles and other durable goods, responding 

to rising energy prices, sought to replace heavier materials (e.g., steel and 

glass) with lig~ter weight plastics. Although prices of plastics and resins 

also increased, potentially adverse impacts of those price increases on demand 

for these materials were offset by sharply rising prices for substitute commodities, steel and glass, which are also manufactured by energy-intensive 

production processes. The combined effect of the increased physical sales 

volume and rising prices substantially increased dollar sales between 1974 and 

1981. 

International trade is another potentially important component of demand. 

Specific data on the import and export of VOLs is not available. The following discussion therefore presents international trade data for Industrial 

Organic Chemicals (SIC 286) and Plastics Materials and Synthetics (SIC 282). 

International trade data on tank storage services are also unavailable. 

Table 9-6 presents data on exports and imports of industrial organic 

chemicals for the years 1972-1981. Comparing these data to dollar sales data 

indicates that a substantial and, over this time period, growing portion of 

sales is for export. Imports of industrial organic chemicals have been 

growing at about the same rate as have industry sales but are much smaller 

than the level of exports, so trade in industrial organic chemicals has contributed favora~ly to the U.S. balance of trade. 

Table 9-7 presents data on exports and imports of plastics materials and 

synthetics. These data also indicate a favorable balance of trade. Growth in 

the value of both exports and imports has just kept pace with the value of 

industry shipment. International competition in Plastics Materials and Resins 

(SIC 2821), however, is expected to erode favorable trade balances that sector 

currently maintains.l6 

9.1.3.2.2 VOL storage terminals. Chemicals are stored in terminals for 

9-12 
TABLE 9-5. EXPORT AND IMPORT VALUES OF INDUSTRIAL ORGANIC CHEMICALS (SIC 286) 

EXCLUDING GUM AND WOOD CHEMICALS (SIC 2861) 

FOR SELECTED YEARS BETWEEN 1972 AND 198115 

Year Exports Imports 

1972 1,073.1 448.6 

1977 2,879.4 1,094. 8 

1978 3,812.9 1 ,484. 2 

1979 5,493.9 1,784.7 

1980 6,292.1 2,008.7 

1981 6,500.0 a 2,050.0 a 

aEstimated. 

TABLE 9-7. EXPORT AND IMPORT VALUES OF PLASTICS MATERIALS 

AND SYNTHETICS (SIC 282) FOR SELECTED YEARS BETWEEN 1972 AND 198116 

Year Exports Imports 

1972 766.9 273.2 

1977 1,751.6 385.6 

1978 1,973.5 509.6 

1979 3,181.2 513.8 

1980 3,973.5 521.2 

1981 3,861.2 a 597.8a 

aEstimated. 

9-13 
short periods partly because of the need for transshipment: changes in the 

mode of transportation between origin and final destination. Chemicals often 

are moved in large bulk shipments to a distribution center by barge or rail 

car. These large shipments are then partitioned into smaller lots for transport by truck to areas not served by barge or rail. The amount of transshipment 

undertaken depends upon locations (origin and destination), alternative transportation costs, product stability, and storage costs. 

Terminals are operated on a proprietary basis and by independent companies. 

Proprietary terminals are owned and operated exclusively by chemical producers 

as part of their distribution systems. Independently operated facilities, 

often called merchant terminals, provide storage services on a contract basis. 

The merchant terminals lease capacity to chemical producers near markets not 

served by appropriate proprietary terminals and at points where transshipment 

occurs. They may also be used by producers when extra storage capacity is 

required on a short-term basis. 

Most terminal operations store other liquid and dry bulk commodities in 

addition to VOLs. Liquids like petroleum, fats, fertilizers, and dry goods of 

many types commonly are stored at terminals. Depending on the terminal's 

location, chemicals account for 5 to 25 percent of a facility's bulk liquid 

capacity and a slightly greater percentage of revenues from bulk liquid 

storage. 9 At any given time a small percentage of a terminal's capacity will 

hold VOLs. Conversion of a tank from another use to_VOL storage is possible 

but requires purging of the tank, an expensive and time-consuming process 

undertaken only about once every 5 to 10 years. Therefore, most tanks are 

believed to be in designated service as far as VOL storage is concerned. 

9.1.4 Market Structure 

Issues addressed in the market structure section of this profile include 

vertical integration, market concentration, geographic distribution of plants, 

and barriers to entry. 

9.1.4.1 Vertical Integration. A firm that produces raw materials or 

fabricated inputs used in the production of its primary output or that engaged 

in further processing of its primary output is said to be vertically integrated. 

Vertical integration is apparent among firms that produce, consume, and store 

VOLs. 

9.1.4.1.1 VOL producer and consumer firms. The relationship between a 

9-14 
firm's production cost and output price is affected, among other things, by 

the extent to which the industry is vertically integrated. Within VOL production and consumption, vertical integration is extensive. Captive consumption 

of VOLs averaged about 52 percent of total output during the period 1955 to 

1978, a ratio that varied only slightly from year to year (see Table 9-4). 

Vertical integration of VOL production and consumption extends to storage 

services. In addition to proprietary storage at the production site, many 

large firms establish proprietary terminals that can serve the needs of nearby 

markets quickly. Because VOL producers and consumers manufacture a range of 

non-VOL products, proprietary terminals also provide storage for other chemical and petroleum products (e.g., fuels). When proprietary storage capacity 

is not available, merchant terminals are leased to store these chemicals. 

9.1.4.1.2 Merchant terminals. Many merchant terminal companies are 

proprietorships or partnerships, some with only a single-terminal, and many 

are vertically integrated into distribution or repackaging services. Petroleum distributors are the most typical type of merchants providing chemical 

storage. A few operators are large, international corporations with many 

terminals in the United States and abroad. Typically, these large firms are 

integrated vertically into distribution and other transportation services. 

9.1.4.2 Market Concentration. Market concentration addresses the issue 

of whether individual market participants exercise economic power. Typically, 

market concentration indicates the share of business held by leading firms in 

an industry. Concentration ratios based on the four largest producers in an 

industry are cited most frequently. 

Hundreds of VOL chemicals exist, covering a wide variety of production 

characteristics, output levels, applications and, consequently, market conditions. Many VOL chemicals (e.g., formaldehyde and alcohols) are manufactured by a relatively large number of firms through various processes. The 

products have a wide range of end uses in which substitute materials often can 

be used. These markets therefore tend to be highly competitive. Other VOL 

chemicals (e.g., succinonitrile and isoamylene) are manufactured by a small 

number of producers (in some cases, only one) and have no close substitutes in 

their end uses. In these markets, producers may be able to influence market 

prices considerably, at least in the short run. 

The precise degree of market concentration in VOL production and consump9-15 
tion is difficult to evaluate because it varies considerably among products. 

However, a general assessment of the industry-wide situation may be made based 

on capacity share data presented in Table 9-8. These data suggest that no one 

company or group of companies dominates the industry. In 1976, the top 4 companies owned only 18 percent of total VOL capacity and the top 20 firms owned 

45.39 percent of total VOL capacity. 

9.1.4.3 Geographic Distribution of Plants. 

9.1.4.3.1 VOL producers. The location of VOL storage is extremely 

important to determinate its commercial value. Table 9-9 contains 1972 and 

1977 data on geographic distribution of production sites of industrial organic 

chemicals.* VOLs are produced in almost every region of the country.t Most 

of the plants are small, employing fewer than 20 workers. The largest plants 

are clustered in the South near raw material supplies and in the Middle Atlantic States close to industries that use the finished products. 

The 1977 statistics suggest that three changes may have taken place in 

the VOL-producing and VOL-consuming industries. First, a shift in the location of plants is apparent among different regions of the country. These data 

indicate that the number of plants in the Middle Atlantic and West North 

Central States is declining and that a large portion of the new plants are 

being constructed in the East North Central and West South Central States. 

Second, plant size, as measured by the number of employees, appears to be 

increasing. In each of the three sectors comprising SIC 286, Industrial 

*Industry definitions for SIC 2861, SIC 2865, and SIC 2869 used by the Bureau 

of the Census do not correspond precisely to definitions of the organic 

chemicals industry used by the International Trade Commission. Thus, data 

presented in Table 9-9 are not strictly comparable with data presented in 

Table 9-4. 

tGeographic regions as defined by the Bureau of the Census are: NORTHEAST 

New England States: Connecticut, Maine, Massachusetts, New Hampshire, 

Rhode Island, and Vermont. Middle Atlantic States: New York, New Jersey, 

and Pennsylvania. NORTH CENTRAL East North Central States: Ohio, Indiana, 

Illinois, Michigan, and Wisconsin. West North Central States: Minnesota, 

Iowa, Missouri, North Dakota, South Dakota, Nebraska, and Kansas. SOUTH 

South Atlantic States: Delaware, Maryland, District of Columbia, Virginia, 

West V1rginia, North Carolina, South Carolina, Georgia, and Florida. East 

South Central States: Kentucky, Tennessee, Alabama, and Mississippi. West 

South Central States: Arkansas, Louisiana, Oklahoma, and Texas. WEST 

Mountain States: Montana, Idaho, Wyoming, Colorado, New Mexico, Arizona, 

Utah, and Nevada. Pacific States: Washington, Oregon, California, Hawaii, 

and Alaska. 

9-16 
!\umber 

of firms 

Top 4 

Top 8 

Top 20 

Top 40 

TABLE 9-8. INDUSTRY-WIDE MARKET CONCENTRATION BASED ON 

CAPACITY SHARE DATA, 197617 

Percent Estimated Percent of 

of firms capacity (Mg) industry capacity 

0. 72 58,751.8 18.3 

1.43 91,820.6 28.6 

3.58 145,752.34 45.39 

7.17 186,681.62 58.14 

9-17 
TABLE 9-9. GEOGRAPHIC DISTRIBUTION OF ESTABLISHMENTS, EMPLOYEES, AtlO VALUE OF 

SHIPMENTS OF SIC 286 I lNDUSfHIAL ORGANIC CH~MlCALS B' ud zs.a. - -- ----- - ----- - --- ---- ---- -- --- -- - --·"'"-'""'"'---=~-===z:;" 

Establishments Establishments 

With Value of With Value of 

SIC 

Locatlonb 

20 or more Employrc~ shf pnwnls 20 or more Employees shfpmrnts 

code Vcnr Tot.11 employees oo:•> ($lOG) Year Tol11l employees (10:1) (~]Qfl) 

20Gl 1972 Unlled Stales 139 41 !1.9 332.3 1977 119 37 4.0 391. J 

Mlcldlo llllnnlfc lll , 0.2 10.0 

West North Central 33 7 o.n 27.3 25 6 

South Atlantic 32 12 2. 7 171.0 18 8 

East South Central 16 9 1.6 86.9 1 1 

West South Central 22 4 0.3 21.2 23 4 >0.2 >9.0 

Pacific 6 3 0.2 11.1 3 2 

2865 1972 United States 173 117 28.2 2,044.5 1977 191 127 35.7 5,637.0 

New England 11 7 1.2 60.5 10 4 

Middle Atlantic 66 47 12. 7 698.6 68 45 16.7 1,933.8 

1.0 East North Central 29 21 >2.5 33 23 I West North Central 4 1 0.15-0.25 ,_. South Atlantic 24 18 4.8 368.5 27 21 CX> East South Central 10 7 1.4 185.6 7 7 

West South Central 18 13 2.2 324.4 16 13 

Pacific 9 3 0.15-0.25 8 5 

All other States 

2869 1972 United States 514 295 101.7 9,179.1 1977 569 346 112.3 24,232.8 

New England 33 15 5.8 212.3 29 18 

Middle Atlantic 141 83 21.4 1,457.7 135 81 16.2 2,318.3 

East North Central 82 45 >2.5 96 50 

West North Central 21 6 t-:-o-2.49 20 6 

South Atlantic 69 41 13.7 1,164.8 70 50 

East South Central 30 18, 8.2 666.5 32 24 

West South Central 87 65 34.7 4,393.6 110 83 45.7 14,075.9 

Mountain 5 3 0.25-0.49 5 3 

l'ac lfic 46 19 ~2.5 42 19 3.6 552.2 

A 11 other States 

aBlanks represent data withheld to avoid disclosing figures for individual companies. 

bGeographic divisions as defined by the Bureau of the Census are listed fn the text. 
Organic Chemicals, the percentage of large plants increased. Third, a shift 

in resources away from SIC 2861, Gum and Wood Chemicals, to SIC 2869, Industrial Organic Chemicals Not Elsewhere Classified, is apparent. The former 

industry lost 20 plants and the latter gained 55 plants in 5 years. 

9.1.4.3.2 VOL consumers. The geographic distribution of VOL consumers 

is presented in Table 9-10. In general, plants in this industry (SIC 282, 

Plastics Materials and Synthetics) are larger than VOL-producing plants are; 

over 75 percent of SIC 282 firms employ more than 20 workers. Overall, the 

industry is not as geographically concentrated as the industrial organic chemical industry is; but a high proportion of the plants are located in the 

Middle Atlantic, South Atlantic, and East North Central States. 

9.1.4.3.3 Terminals. Data on capacity of merchant storage terminals, by 

State, are presented in Table 9-11. Over half (51 percent) of ILTA members 

are located in Texas, Louisiana, and New Jersey. These data must be interpreted cautiously with respect to VOL storage, however, because capacity estimates include many large petroleum storage tanks. 

Although data on proprietary storage are not available, major oil firms 

that also produce VOLs often use their petroleum distribution terminals to 

handie chemicals. Many of these terminals, along with a number of terminals 

owned by chemical producers, are located along the inland waterway system that 

covers the North Central and Southern States. 

9.1.4.4 Barriers to Entry. Although entry into and departure from the 

principal industries storing VOL could not be measured directly, some general 

comments are appropriate about conditions facing firms considering entry into 

the industry. Entry can take two forms. First, a chemical producer or consumer can enter by acquiring tanks for proprietary storage or vertical 

integration. These firms face apparently surmountable barriers of capital 

formation, expertise, and local laws and standards. A storage facility 

requires expenditures for tanks, land, and concrete pads. Support services, 

labor, and maintenance must be provided. Such firms also must find or develop 

expertise in managing storage operations.. Before construction of the facility 

can begin, permits must be obtained from Federal, State, and local Government 

agencies, and construction usually must conform to standards set by private 

organizations. All of these barriers can be overcome if the internal rate of 

return on the investment is sufficiently attractive. Alternatively, many 

firms can bypass legal barriers to entry by purchasing an established storage 

facility. 

9-19 
\0 

I 

N 

0 

TABLE 9-10. GEOGRAPIIIC DI STRII3UTION OF ESTAOLISIIMENTS, EMPLOYEES, /\NO VALUE OF 

SHIPMENTS OF SIC 282, PLASTICS MATERIALS AND SYNTIIETICS2°•2ta -......-.:-;~ --~~-::-:-_:----~----=~~-=--- -~-:;.: -- .,.. ...... ..., ________ , 

Establishments 

With 

20 or more Employees 

Value of 

SIC shipments 

code Year Locationb Total employees (103 ) ($106 ) Year Total 

2821 1972 

2822 1972 

2823 1972 

2824 1972 

United States 

New England 

Middle Atlanllc 

East North Central 

West North Central 

South Atlantic 

East South Central 

West South Central 

Pacific 

United States 

East North Central 

South Atlantic 

East South Central 

West South Central 

Pacific 

United States 

Middle Atlantic 

East North Central 

South Atlantic 

East South Central 

United States 

New England 

Middle Atlantic 

South Atlantic 

East South Central 

East North Central 

323 

30 

66 

00 

12 

35 

18 

35 

46 

59 

13 

7 

3 

18 

8 

20 

6 

1 

8 

3 

60 

6 

35 

15 

263 

28 

53 

64 

11 

27 

15 

31 

35 

34 

5 

6 

3 

16 

2 

14 

4 

1 

1 

2 

54 

4 

35 

14 

54.8 

>2.5 

>2.5 

>2.5 

1:-o-2,49 

>2.5 

4.5 

>2.5 

Co-2.49 

11.8 

1. 0-2.49 

0.5-.99 

1.0-2.49 

>2. 5 

0.25-0.49 

19.0 

>2.5 

1. 0-2.49 

1. 0-2.49 

1. 0-2.49 

76.3 

0.25-4.9 

54.6 

21.3 

4,478.2 

333.4 

1,089.4 

627.9 

3,601.4 

2,636.2 

950.6 

1977 

1977 

1977 

1977 

aBlanks represent data withheld to avoid disclosing figures for individual companies. 

bGeographfc divisions as defined by the Bureau of Census are listed in the text. 

397 

34 

01 

81 

11 

54 

23 

44 

59 

63 

11 

3 

14 

10 

1 

5 

2 

66 

3 

2 

43 

12 

1 

Establishments 

Wlth 

20 or more Employees 

employees (103 ) 

310 

25 

G!i 

63 

8 

46 

19 

36 

43 

30 

3 

3 

13 

10 

1 

5 

2 

58 

3 

1 

41 

12 

1 

57.2 

10.0 

15.9 

74.0 

Value of 

shipments 

($lOG) 

10,8111.2 

1,863.3 

998.9 

6,379. 7 
TABLE 9-11. TOTAL 1982 MERCHANT LIQUID BULK CAPACITY, BY STATE8 

State 

Alabama 

Arizona 

Arkansas 

Ca 1 iforni a 

Colorado 

Connecticut 

Delaware 

Florida 

Georgia 

I 11 i noi s 

Indiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maryland 

Michigan 

Minnesota 

Mississippi 

Missouri 

Nebraska 

Nevada 

New Jersey 

New York 

North Carolina 

North Dakota 

Ohio 

Oklahoma 

. Oregon 

Pennsylvania 

South Dakota 

Tennessee 

Texas 

Virginia 

Washington 

West Virginia 

Wisconsin 

Total 

Total capacity 

(m3) 

337,269 

24,009 

72,989 

1,428,962 

12,100 

550,459 

184,758 

294,198 

663,982 

1,866,126 

135,180 

781,948 

291,471 

4,055 

4,001,388 

260,190 

39,988 

581,719 

154,548 

239,763 

273,035 

8,268 

4,230,975 

1,464,066 

409,807 

126,271 

257,501 

440,876 

429,917 

1,416,862 

156,186 

133,823 

5,944,659 

20,218 

187,886 

120,840 

64,939 

27,617,231 

9-21 

Share of total 

U.S. capacity 

(%) 

1.22 

0.09 

0.26 

5.17 

0.04 

1.99 

0.67 

1.06 

2.40 

6.76 

0.49 

2.83 

1.06 

0.01 

14.51 

0.94 

0.14 

2.11 

0.56 

0.87 

0.99 

0.03 

15.32 

5.30 

1.48 

0.46 

0.93 

1.60 

1.56 

5.13 

0.57 

0.48 

21.53 

0.07 

0.68 

0.44 

0.24 

100.00 
Potential merchant terminal operators face similar barriers, among them 

capital formation, which is often more difficult for the small business than 

for the larger business. Also, capital formation may be more difficult for 

new terminal operators than for existing operators wishing to expand their 

operations but is not anticipated to represent a barrier sufficient to prevent 

entry into the industry. 

9.1.5 Market Conduct 

This section focuses on pricing behavior in the industrial organic chemicals and merchant terminals industries. The observations could be helpful 

for assessing the price impacts of the proposed new source performance standard (NSPS). 

9.1.5.1 Che~ical Pricing. VOL producers and consumers manufacture many 

chemicals embracing a wide variety of characteristics. Potential for substitution and/or intermediate competition varies considerably from chemical to 

chemical. In general, though, a price-induced incentive to substitute is 

diminished by the fact that good substitutes .are frequently also VOLs. The 

substitutes are therefore also subject to cost and price changes related to a 

storage standard or other common factors. 

Table 9-12 presents price data for industrial organic chemicals and plastics, resins, and elastomers materials from 1955 to 1981. These data indicate 

that during the era of stable, low-energy prices from 1955 to 1973, chemical 

prices remainec stable in current terms and declined slightly in constant terms. 

Following the rapid increase in energy prices in the fall of 1973 and in 1974, 

the average current price of organic chemicals rose sharply and continued to 

increase between 1975 and 1981. However, constant prices increased at a much 

slower rate than did current prices. 

Data in Table 9-12 also indicate that both current and constant prices 

for plastics and resins declined during the period 1955 to 1972 as energy 

prices remained stable and production technology improved. However, the sharp 

increase in ra~ ~aterial prices in 1973 resulted in a 29 percent increase in 

current prices for those products between 1973 and 1974. The product prices 

of the industry again increased substantially between 1974 and 1975. Thereafter, the rate at which current prices increased slowed, and real prices 

remained stable between 1975 and 1977. Between 1977 and 1981, the real price 

of plastics, resins, and elastomers fell. 

9-22 
Year 

1955 

1956 

1957 

1958 

1959 

1960 

1961 

1962 

1963 

1964 

1965 

1966 

1967 

1968 

1969 

1970 

1971 

1972 

1973 

1974 

1975 

1976 

1977 

1978 

1979 

1980 

1981 

TABLE 9-12. HISTORICAL PRICE DATA FOR INDUSTRIAL ORGANIC CHEMICALS 

AND PLASTICS, RESINS, AND ELASTOMERS, 1955-1981 

Industrial organic · chemicals 

Average unit prices 

Currenta Constantb 

((l:/kg) (¢/kg) 

24 

24 

24 

26 

28 

28 

30 

29 

28 

27 

27 

28 

29 

29 

27 

26 

27 

26 

28 

44 

53 

59 

62 

65 

72 

83 

92 

27 

27 

26 

27 

30 

30 

32 

30 

30 

28 

28 

28 

29 

28 

25 

24 

23 

22 

21 

28 

31 

33 

32 

32 

31 

32 

32 

Plastics, resins, and 

elastomers 

Average unit price 

Current a 

(¢/kg) 

69 

67 

67 

65 

67 

65 

62 

59 

59 

55 

57 

54 

51 

47 

47 

45 

45 

44 

45 

58 

75 

79 

83 

84 

96 

110 

109 

b Constant 

(¢/kg) 

79 

74 

72 

69 

70 

69 

66 

63 

62 

58 

59 

54 

51 

46 

44 

41 

39 

37 

35 

37 

44 

44 

44 

41 

42 

42 

38 

Producer price 

!~~~~a~~:r:!~ 

86.6 

90.0 

92.8 

93.8 

94.6 

94.7 

94.4 

94.5 

94.3 

94.8 

96.3 

99.0 

100.0 

102.6 

106.2 

110.2 

113.8 

117.9 

129.2 

154.1 

171.1 

179.0 

190.1 

204.2 

228.8 

261.5 

286.0 

aAverage unit price was calculated from Tables 9-4 and 9-5 as total sales 

value divided by total sales quantity. Rounding may make converted values 

appear inconsistent. 

bConstant prices, measured by 1967 dollars, were calculated by dividing the 

average constant unit price of the chemicals by the producer price index 

for all manufactured goods. 

cReferences 11, 22. 

9-23 
9.1.5.2 Merchant Terminal Storage Pricing. Results of a telephone survey of nine merchant terminal operators suggest two general pricing schemes 

are practiced. Under the simpler method, the terminal charges a fee (often 

called a throughput fee) for each unit of chemical that passes through its 

storage tanks.* Individual terminals adjust throughput fees to reflect variations in quality of storage service provided to the customer and in physical 

properties of the chemical to be stored. 

Under the more complex pricing system, the terminal charges a basic fixed 

fee for the duration of the storage contract to recover fixed costs associated 

with the terminal 1s storage facilities and costs associated with handling a 

minimum voluoe of throughput.t If throughput exceeds the level on which the 

minimum charge is based, the terminal levies an additional per-unit charge on 

the additional volume of chemicals it handles to cover the cost of additional 

labor, energy, and materials inputs. Often, as the volume of throughput and 

the number of tank turnovers (throughput divided by tank capacity) increase, 

the price charged by the terminal for additional throughput is reduced, reflecting economies of scale in handling large numbers of turnovers.t Companies apparently vary the fixed fee they charge according to market 

conditions so discounts may be offered when demand for storage services is 

low. Payment for additional throughput services is made in two parts. Half 

of the throughput rate is collected as the chemicals are unloaded from trucks, 

rail cars, or barges into the storage tank and the remainder is collected as 

*For example, a customer may require storage for 1.5 million Q/yr of methyl alcohol. If the throughput rate for methyl alcohol is 3¢/!, the total annual 

cost to the customer of storing this volume is $45,000. 

tUsually the minimum throughput represents four complete turnovers of the 

rented storage tanks 1 volume. If a 1-million-liter tank is rented by a customer, the customer will be able to store up to 4 million liters in the tank 

in any given year before incurring additional charges. 

TAn example of the second pricing scheme is as follows. The annual rental fee 

for storing methyl alcohol in a 250,000-liter tank might be $30,000. 

If annual throughput exceeds 1 million~ (i.e., the chemicals in the tank 

are turned over more than four times), a surcharge of 2¢/~ of chemicals 

might be levied for the next 500,000 ~ of throughput. The surcharge might 

be lowered to 1.5¢/~ for all annual throughput exceeding 1.5 million~­

Thus, if total annual throughput is 1.5 million~. total terminal revenues 

might be $40,000. If throughput rises to 2 million~. terminal revenues 

might increase to $47,000. · 

9-24 
the chemicals leave storage. The basic fee is collected while the tank is 

used. 

Other storage pricing systems may be used in addition to the two methods 

described here but were not identified in the survey, which covered only 

approximately 10 percent of all merchant terminal operators. Details of the 

pricing policies used by the remaining. 90 percent of VOL merchant terminals 

were not available. 

Finally, it should be noted that virtually every storage contract is 

unique because of the large number of services offered by terminals to 

customers. Variables that affect basic rates and throughput surcharges include options that may be added to a tank (e.g., floating roofs, nitrogen 

blankets, refrigeration, insulation, steam heating, special linings, auxiliary 

pumps, vapor recovery systems, and other pollution control devices), modes of 

transportation, length of contracts,* age of tanks,t and corrosivity and 

toxicity of chemicals.+ Additional services add to storage costs, which are 

passed directly to the customer in the contract. 

9.1.6 Market Performance 

9.1.6.1 VOL Producers' and Consumers' Financial Characteristics. Two 

recent EPA reports presented data and results of an analysis on fiscal year 

(FY) 1977 financial data for a sample of 100 chemical firms.23•2 4 It was 

estimated that the average aftertax cost of capital measured in current dollar 

terms for chemical firms was 10.81 percent. If capital costs are distributed 

normally, 95 percent of the industry firms face aftertax capital costs ranging 

from 8.95 to 12.67 percent. 

9.1.6.2 Merchant Terminals' Financial Characteristics. A financial profile of terminal services could not be developed because (1) financial data 

are not provided by many firms and (2) data on the terminal operations of vertically integrated firms are not reported separately from other operations on 

Security and Exchange Commission (SEC) 10K forms. 

*The basic rate of a 1-year contract is likely to be higher than that of a 

15-year contract due to the capital recovery factory. 

tin Texas, State regulations require different designs on tanks built before 

and after 1976. 

+Corrosivity requires relining of the tanks, and toxicity requires special 

handling equipment and techniques. 

9-25 
9.1.7 Projected New and Reconstructed VOL Storage Tanks: Calendar Years 

1984-1988 

The projection for new and reconstructed tanks has two components: tanks 

that replace retiring tanks and tanks that increase total storage capacity. 

The projection 1 s methodology and results for each component are discussed 

separately below. 

Replacement tanks were projected by three steps. First, the number of • 

tanks in place in each of the years 1954-1977 has been estimated by using the 

Federal Reserve Board index of organic chemical production as a proxy of VOL 

chemical production capacity during the 1954-1977 period. 25 ' 26 This index has 

been smoothed through regression procedures,* and the total number of VOL 

tanks in place for each of the years is computed based on the regression equation and 1977 data on the number of VOL storage tanks. 27 ' 28 Inherent in this 

procedure is the assumption that the ratio of storage capacity to production 

capacity is constant. 

Second, a tank age profile for 1977 has been constructed by using a recursive procedure that assigns ages to tanks based upon the number of tanks 

existing in the prior years as established in the first step of this methodo logy. 

1. 

Additional assumptions required for this procedure are as follows: 

A tank 1s economic life is assumed to be 20 years, an assumption 

consistent with the tank cost methodology of Chapter 8. 

2. During the initial year (1954) of the recursive process the age of 

tanks was uniformly distributed between 1 and 20 years. This assumption is fairly arbitrary but, because the number of tanks estimated 

in 1954 (3,800) is estimated to be less than 14 percent of the total 

number in 1977 (27,540), alternate assumptions are unlikely to produce substantially different results. 

3. All obsolete (20-year old) tanks were replaced and new tanks purchased at the beginning of each year. This assumption is necessary 

simply because the recursive procedure is a discrete approximation 

*The smoothed data are the predicted values of the index with a log linear 

specification: In Yt = .079 t. In Yt is the natural logarithm of the 

production index for year t (t = 1954 to 1977), and .079 is estimated 

through least squares procedures with the regression line constrained to 

pass through the observation for 1977. 

9-26 
of a continuous process. Alternate assumptions, including refinements in the time interval used, are also unlikely to produce substantially different results. 

The recursive procedure works as follows: given the age distribution of 

tanks in 1954 (assumption 2 above), age all existing tanks 1 year, compute the 

number of replacement tanks required in 1955 (the number of tanks that have 

aged to 21), compute the number of new tanks required in 1955 (the difference 

between the total tanks in 1955 and 1954), and construct an age distribution 

of tanks in 1955. This process is repeated year by year until an age distribution of tanks for 1977 has been generated. 

The third step in projections of tank replacement for 1984-1988 is to use 

the 20-year economic life assumption and the age distribution of tanks in 1977 

to compute the number of tanks in each of the projection years. That is, each 

tanks in the 1977 age profile that will be 21 years old in a projection year 

will be replaced in that year. These results indicate that 4,900 replacement 

tanks will be constructed during the period 1984-1988 (see row 1 of Table 9-13). 

Projected VOL storage tanks construction that adds new capacity nationwide 

is based upon forecasted growth of the organic chemicals industry. The Federal 

Reserve Board index of organic chemical production, extrapolated to the 

1984-1988 period from data for the period 1954 to 1977, indicates an average 

annual growth rate of about 7.9 percent. Chemical industry observers from the 

American Chemical Society and the U.S. Department of Commerce have independently indicated some apparent slackening in long-term growth in the organic 

chemicals sector and a probably more realistic growth rate of 4 to 6 percent 

for the projection period. 29 •3° On this basis, 5 percent annual growth in the 

organic chemicals industry and proportionate increases in tank and production 

capacities are assumed to project new capacity tanks (see row 2 of Table 9-13). 

Over the period 1984-1988, 10,200 new capacity tanks are projected. By comparison, a 7.9 percent growth rate from 1977 would have resulted in a projection of 21,620 new capacity tanks in the period. Total new tank construction 

in the projection period is shown in row 3 of Table 9-13. 

Finally, the projection of new tanks during 1984-1988 is disaggregated by 

capacity and vapor pressure. A 1977 survey of VOL storage tanks provided an 

estimated pressure and volume distribution for the tanks (see Table 9-14 for a 

summary).3 1 • 32 This percentage distribution table was secular multiplied by 

9-27 
l.O 

I 

N 

cc 

TABLE 9-13. PROJECTION OF VOL STORAGE TANK CONSTRUCTION--1984 TO 1988 

ALL CAPACITIES, VAPOR PRESSURES, AND ROOF DESIGNS 

Tanks 1984 1985 1986 1.987 1988 

Total number of new tanks built 1,030 1,100 1,170 1,250 1,340 

nationwide to replace retiring, existing tanks 

Total number of new tanks built 1,850 1,940 2,030 2,140 2,240 

nationwide to supplement existing 

VOL storage capacity at an annual 

growth rate of 5 percent 

Total number of new tanks built 2,880 3,040 3,200 3,390 3,580 

nationwide--replacement plus 

5 percent new capacity growth 

---- ------ - -- -- -- -- - - - --- - - -- -- ---- - - - - ------ -- =.::- -_ -;.:::=:-=.-: 

Total 

(1984-1988) 

4,900 

10,200 

16,090 
TABLE 9-14. ESTIMATED PERCENTAGE DISTRIBUTION OF VOL ~TORAGE TANKS 

BY VAPOR PRESSURE AND TANK CAPACITY, 1977 

VaEor Eressure (KPa) 

Capacity 0- 3.5- 6.9- 10.3- 34.5-

(m3) 3.5 6.9 10.3 34.5 58.6 >58.6 TOTAL 

0-75 27.98 6.55 3.22 5.14 1.23 0.39 44.51 

75-150 9.26 1. 58 0.93 2.32 0.03 0.13 14.25 

150-375 8.94 1. 68 1.17 2.28 0.19 0.06 14.32 

375-3,750 12.84 2.98 1.58 5.59 0.46 0.16 23.61 

3,750-15,000 1.12 0.36 0.35 1.10 0.09 0.00 3.02 

~15,000 0.03 0.00 0.07 0.19 0.00 0.00 0.29 

TOTAL 60.17 13.15 7.32 16.62 2.00 0.75 100.00 

aThe original percentage distribution table covers 24 volume intervals and 18 

pressure intervals. This table summarizes the distribution table for relevant, 

aggregate intervals of both volume and pressure. All computations of 

economic impact were performed using the intervals and data of the original 

distribution table. 

9-29 
the projected new tank totals of Table 9-13 to yield volume and pressure intervals for the period 1984-1988.* Table 9-15 shows the summary results of this 

multiplication for all new tanks projected for 1984-1988. This application of 

the estimated 1977 tank distribution assumes the VOL storage tank distribution 

by vapor pressure and tank size will remain constant over time. 

All projections described in this subsection are based on assumptions and 

data described above. While they are as accurate as the data and assumptions 

permit, changes in the economy, technological advances, development of competitive substitutes, discovery of new product uses, and changes in market stability 

may affect actual industry growth. Such occurrences are difficult to anticipate. These projections reflect the most probable scenario and are the best 

possible, given the data available. 

9.2 ECONOMIC IMPACTS OF REGULATORY ALTERNATIVES 

This section presents the estimated impacts of the regulatory alternatives on the users of VOL storage tanks. Six regulatory alternatives are 

considered, the first of which is the baseline case from which the impacts are 

measured. In general, the alternatives are increasingly more stringent moving 

from the baseline to Regulatory Alternative V. The economic impacts considered 

in turn are: the impact on the price of the output of the two model plants, 

the impact on investment in the two model plants, the impact on investment in 

VOL storage nationwide and the impact on the annual costs of VOL storage nationwide. 

9.2.1 Product Price Impacts 

Estimates of the impact of the regulatory alternatives on product prices 

have been developed based on two model plants: an independent storage terminal 

and a VOL chemical producer/consumer. The tank requirements and other characteristics of these two facilities are described in detail in Chapter 6. They 

were selected for analysis because it is believed that they would experience 

relatively greater than average cost impacts as a result of the imposition of 

any of the regulatory alternatives. Before turning to the estimates, a brief 

description of the general approach and assumptions is first presented. 

In the long-run the market price of a product produced by a competitive 

industry is equal to the average cost, including a normal return on investment, 

*There are 24 volume intervals and 18 vapor pressure intervals in the original 

percentage distribution table. 

9-30 
TABLE 9-15. PROJECTION OF VOL STORAGE TANK CONSTRUCTION b 

BY VAPOR PRESSURE AND TANK SIZE, 1984-1988a, 

Capacity 

(m3) 

0-75 

75-150 

150-375 

375-3,750 

3,750-15,000 

~15,000 

TOTAL 

o3.5 3.5-

6.9 

4,500 1,050 

1,490 250 

1,440 270 

2,070 

180 

480 

60 

10 0 

9,680 2,120 

Vapor pressure (KPa) 

6.9- 10.3- 34.5-

10.3 34.5 58.6 >58.6 

520 830 

150 370 

190 370 

250 900 

60 180 

10 30 

1,180 2,670 

200 

10 

30 

70 

20 

0 

320 

60 

20 

10 

30 

0 

0 

120 

TOTAL 

7,160 

2,290 

2,300 

3,890 

490 

50 

16,090 

aThe original percentage distribution table covers 24 volume intervals and 18 

pressure intervals. This table summarizes the distribution table for relevant, 

aggregate intervals of both volume and pressure. All computations of 

b 

economic impact were performed using the intervals and data of the original 

distribution table. 

Rows and columns may not sum to totals due to rounding. 

9-31 
of ne~ facilities. This is because firms will not choose to build a new facility unless they anticipate that the market price will be sufficient to cover 

all costs. Thus, the change in the average operating cost of a new facility 

due to an NSPS is the best point estimate of the long-run product price impact 

of the regulatory alternatives under consideration. In a case such as that 

presented here, where the model facilities utilized would be expected to experience greater than typical cost increases, the average industry price effects 

measured in this way would be overstated. 

As documented in Chapter 8, all the regulatory alternatives except the 

baseline will increase tank fabrication costs. This increase in cost can be 

taken as the increase in the price of tanks to the VOL tank users based on the 

same logic as outlined above. For a constant cost tank industry, as illustrated in Figure 9-2, this increase in average costs will show up as a vertical 

shift in a horizontal supply curve from S to S'. The price of tank type i in 

year twill rise from P toP'. 

nowever, the long-run impacts of the regulatory alternatives on the price 

of VOL storage services cannot be simply calculated from this price change 

alone. This is because the regulatory alternatives considered here impact services and performance, as well as the price of the tanks. In principle, at 

least, these impacts can affect the cost of storage services in three ways: 

they reduce the effective capacity of a tank due to the insertion of an internal roof; they reduce storage capacity requirements because they improve 

storage efficiency, and they reduce VOL vaporization and, hence, VOL losses. 

The first impact is mechanical in origin: an internal floating roof 

occupies 1 to 2 feet of vertical space in a storage tank, thus decreasing the 

effective capacity of the tank. The capacity reduction is inversely related 

to the height of the tank and ranges between 6 and 12 percent of capacity for 

a 75-m3 tank that is 16 feet high and between 2 and 4 percent of volume for a 

20,000-m3 tank that is 48 feet high. Thus, everything else being equal, this 

feature of the regulatory alternatives would tend to increase the number of 

tanks impacted as more tanks would be needed to store a given velum~ of VOL. 

Second, the reduction in VOL vaporization accompanying the regulatory 

alternatives will affect the capacity requirements of VOL starers. Specifically, the use of more efficient tanks means that less VOL will be needed to 

serve given production or marketing requirements. Thus, everything else being 

9-32 

' 
$/Tank 

P' a c -------+--f---- S' 

p b d 

s 

Tanks/Year 

Figure 9-2. VOL storage tank market for tanks in volume interval i 

as characterized in the economic impact analysis. 

9-33 
equal, this feature of the regulatory alternatives would tend to decrease the 

number of tanks impacted. Fewer tanks would be needed to store a given volume 

of VOL. The magnitude of the reduction in tank requirements will depend on 

the effectiveness of vapor emissions reduction and the relationship between 

storage tank capacity and VOL use. Assuming a capacity to throughput ratio of 

0.4 and the equipment effectiveness described in Chapter 7, the requirement 

for tank storage capacity would be reduced by roughly 1 percent. 

The proposed regulatory alternatives therefore initiate two influences on 

storage costs that work in opposite directions. Since the magnitudes of these 

influences are thought to be relatively small as well as contrary, no attempt 

is made to adjust estimates of VOL storage tank requirements to account for 

them in each regulatory alternative. 

The final impact is also technical in origin but has important economic 

implications. In particular, since the additional equipment required by the 

regulatory alternatives will reduce the amount of VOL vaporized, fewer valuable VOLs will be lost to the atmosphere. Therefore, this quality improvement 

in the tanks will at least partially offset any increase in the price of the 

tanks. This consideration is incorporated into the analysis. With this background, the mechanics of the procedure used to develop the price impacts in 

next discussed. 

The change in the price of VOL storage services was estimated for both 

model plants using Equation 9-1: 

where 

20 

k

0 + k

1 = ITC + ! [(1 - G)(P · Q - C) + G·Dt] (1 + r)-t , t=1 

k

0 = initial incremental investment 

k

1 = incremental investment in year 10 discounted to the 

present 

ITC = the investment tax credit (10 percent} 

r = real after tax rate of discount (10 percent) 

t =year (1,2,3, ... , 20) 

Q = annual output 

P = change in price 

9-34 

(9-1) 
C = incremental annual operating cost 

G = tax rate (49 percent) 

Dt = straight line depreciation in year t, with an assumed 20 

year commercial life for floating roofs and 10 year 

commercial life for seals. 

Equation 9-1 is a financial balance equation that states that the present 

value of the investment and operating costs required by the regulatory alternative must be equal to the present value of the stream of revenues. By 

solving the equation for P, one obtains the change in the price of the product 

or service required if the plant or terminal operator is to achieve a return 

on investment for the mandated equipment that is competitive with other investment opportunities. 

The genercl features of the financial balance computation are as follows. 

The firm obtains a 10 percent investment tax credit on the equipment purchase. 

The computation is done on an after tax basis where the income tax rate is 49 

percent of net revenues. All revenues are in constant 1982 dollars, so the 10 

percent rate of discount selected for this analysis is a constant (or real) 

after tax rate. A 10 percent rate of discount is consistent with that employed 

in Chapter 8 for annualization of capital costs. As discussed in Section 9.1, 

financial data for 1978 from a sample of 100 chemical companies shows an 

average after tax rate of return of 10.81 percent. Given the inflationary 

economic environment of 1978, the real rate of return to the firms would 

likely have been somewhat less that 10 percent. Using a real after tax discount rate that is arguably high tends to overstate the price impact of the 

regulatory alternatives. Finally, a 20-year commercial life for tanks was 

assumed in keeping with the analysis of Chapter 8. 

Parameters assumed in the use of Equation 9-1 include a model terminal 

throughput rate of 39 x 106 kg/year and a model VOL producer/consumer output 

of 80 percent of a production capacity of 4.5 x 106 kg/year. Capital costs 

and operating expenses are taken from Chapter 8. Equation 9-1 was solved both 

without and ~ith adjustments allowing a $460/Mg emission savings credit to be 

subtracted from operating costs for each model plant. The $460/Mg figure is 

based upon a weighted average price of organic chemicals computed for 1978 

production and prices as inflated to 1982 dollars by a chemical producers 

9-35 
price index.* 

The projected price impacts on VOL storage services of the regulatory 

a1ternatives with and without the emission savings credit are shown in 

Table 9-16. As was anticipated, the price impacts increase with increases in 

the stringency of the regulatory alternatives. Recognition of the value of 

emission savings reduces the price impacts somewhat. 

To help place these values in perspective, the price impacts were divided 

through by the estimated product price and multiplied by 100 to obtain estimates of the percentage change in the product prices for the two model plants. 

S460/Mg was used to estimate the product price of the model producer/consumer 

and $0.01/kg was used as the average storage charge of the model independent 

terminal. This later value is based upon an estimated capital cost of the 

model terminal, inclusive of land and tank foundations, of $1.72 x 106 1982 

dollars and operating costs equal to 7 percent of the capital costs. The 1¢/kg 

figure was determined by applying these costs to Equation 9-1 and solving for 

price. This capital cost is probably very conservative since it excluded the 

purchase and installation cost of pumps, piping, gauges, etc., that ordinarily 

constitute a substantial portion of the capital expenses of a storage terminal. 

If higher capital costs were used, the computed price of storage would be 

higher, and the percentage change in price due to the regulatory alternatives 

would be even lower. 

Table 9-17 presents the estimated percentage changes in VOL storage prices 

and VOL output prices. These percentages are very small for the model producer/ 

consumer since VOL storage is such a small part of his costs. The percentage 

change in the average price of storage at the model terminal is somewhat higher, 

ranging from 3.7 to 4.3 percent for Regulatory Alternatives I through IV and 

11.8 percent for Regulatory Alternative V with an emission savings credit. 

9.2.2 Investment Impacts 

The investment impacts of the regulatory alternatives for the model plant 

and VOL storage industry are provided below. 

9.2.2.1 Model Plant Investment Impacts. As reported in Chapter 8, the 

installed capital cost of VOL storage tanks alone for the model terminal is 

*The 1978 weighted average price was obtained from Reference 24. Inflation to 

1982 was performed using the Industrial Chemical Procedures Price Index from 

the Chemical Engineering Journal. The adjustment is documented in Reference 

33. 

9-36 
Regulatory 

TABLE 9-16. PRICE IMPACTS OF THE REGULATORY ALTERNATIVES 

FOR THE MODEL TERMINAL AND MODEL PRODUCER/CONSUMER 

Model independent Model producer/ 

terminal consumer 

(¢/kg) (¢/kg) 

Without With Without With 

emission emission emission emission 

savings savings 

alternative credit saving~ 

credit credit saving~ 

credit 

I 0.049 0.037 0.15 0.11 

II 0.050 0.038 0.17 0.11 

III 0.051 0.038 0.20 0.11 

IV 0.056 0.043 0.23 0.14 

v 0.132 0.118 0.72 0.63 

aThe emission savings credit is calculated in Chapter 8 based on a price 

for VOL of $460/Mg ($ 1982). 

g ... 37 
TABLE 9-17. PERCENTAGE CHANGE IN OUTPUT PRICE FOR THE MODEL 

PLANTS DUE TO THE REGULATORY ALTERNATIVES 

Model independent Mode1 produEer/ terminal a consumer 

Without With Without With 

emission emission emission emission 

Regulatory savings savingc savings savingc alternative credit credit credit credit 

I 4.9 3. 7 0.3 0.2 

II 5.0 3.8 0.4 0.2 

III 5.1 3.8 0.4 0.2 

IV 5.6 4.3 0.5 0.3 

v 13.2 11.8 1.6 1.4 

aThe average price of storage per kg was assumed to be $0.01 ($ 1982). 

bThe average price of VOL was assumed to be $460/Mg ($ 1982). 

cThe emission savings credit is calculated in Chapter 8 based on a price 

of VOL_of $460/Mg ($ 1982). 

9-38 
1.07 million in 1982 dollars. The installed capital cost of the storage tanks 

alone of the model chemical producer/consumer was estimated to be 0.25 million 

1982 dollars. Incremental capital costs were computed for each of the model 

plants for each of the regulatory alternatives. These costs, previously presented in Chap~er 8, are consolidated in Table 9-18. They show additional 

investment requirements of between 56 and 185 thousand 1982 dollars for the 

independent terminal and between 16 and 91 thousand 1982 dollars for the model 

producer/consumer of VOLs. 

9.2.2.3 Hationwide Investment Impacts. Nationwide impacts depend on the 

volume and vapor pressure characteristics of new tanks in each year of analysis. 

Therefore, the first step in the estimation of the nationwide investment impact 

of regulatory alternatives is to estimate the number of new tanks that would 

be subject to VOL regulations by year, t; by volume interval, i; and by pressure interval, p. As described in Subsection 9.1.7, this is done by scalar 

multiplication of each of the annual projections of new tanks from Subsection 

9.1.7 by a percentage distribution table containing estimates of the percentage of tanks in each volume and pressure interval based upon the 1977 survey 

of VOL storage tanks. 27 ' 28 The resulting values, T~P, are the number of VOL 

tanks in year t, volume interval i, and pressure interval p that are projected 

to be subject to regulation. 

In conjunction with the baseline conditions of Chapter 3, these values 

are then used to estimate the impacted tank population of each regulatory 

alternative. The impacted tank population is that portion of the new tank 

population in any year that will actually undergo design changes and 

experience cost increases under each regulatory alternative. The impacted 

tank population for any regulatory alternative, year, and volume interval is 

found by summing T~p values over appropriate pressure intervals and by scaling 

by appropriate baseline assumptions. For example, the summation over vapor 

pressures for the volume interval 95 m3 to 115 m3 under Regulatory Alternative I 

excludes VOL tanks whose vapor pressures are less than~ 3.5 kPa because they 

are lower than the 3.5-kPa baseline cutoff. In addition, this summation scales 

the number of remaining tanks in the volume interval by 0.65 because the baseline assumes that 35 percent of the new VOL storage tanks in that interval 

would be built with internal floating roofs even without Regulatory Alternative 

I. The resulting value, T~, is the estimated number of tanks in volume interval 

i and year t that are impacted by Regulatory Alternative I. 

9-39 
TABLE 9-18. INVESTMENT IMPACTS OF REGULATORY ALTERNATIVES FOR 

THE MODEL INDEPENDENT TERMINAL AND MODEL PRODUCER/ 

CONSUMER (103 $1982) 

Re9ulatory Model independent Model producer/ 

alternatives terminal consumer 

3c.seline 1,070.0 250.0 

I 56.0 15.8 

II 56.6 16.0 

III 56.6 16.0 

IV 71.8 23.2 

v 184.8 90.8 

9-40 
Table 9-19 shows the tank population impacted by Regulatory Alternative I 

as a percent of the projected new VOL storage tank population. Of course, the 

actual number of tanks impacted will vary by year. Table 9-20 presents similar 

data for Regulatory Alternatives II through V. The percentages are the same 

for each of these four regulatory alternatives because they cover the same 

volume and pressure ranges and because the baseline conditions assume that 

none of these technologies would have otherwise been adopted. 

Calculation of T~ is therefore based on the number of new storage tanks 

projected in Subsection 9.1.7. The projections were developed in the absence of 

an NSPS for storage tanks. With higher prices for a product, due, for example 

to an NSPS, quantity demanded typically decreases. The decision to treat 

demand as constant in any given year is based upon the following analysis. 

A pure number called the elasticity of demand can be used to relate 

changes in the price of tanks to changes in the quantity of tanks demanded. 

More specifically, the elasticity of demand for tanks, ~T' is the ratio of the 

proportionate change in quantity due to a proportionate change in price where 

other prices, technology, etc., are held constant.* Alfred Marshall proposed 

four determinants of the demand elasticity for any factor of production, such 

as VOL storage tanks, within an industry. As modified to reflect a two-factor, 

constant-returns-to-scale production technology by Layard and Walters, 34 the -

price elasticity, ~T' of VOL production, consumption, or storage varies 

directly with the following: 

1. The elasticity of demand C~v) for VOLs, VOL products, or VOL 

storage. 

2. The elasticity of substitution, ST Y' 

question, T, and the other factor, Y. ' 

between the factor in 

3. The share of tanks in the production cost so long as the elasticity 

of demand for VOLs, VOL products or VOL storage, ~V' exceeds the 

elasticity of substitution of the factors, ST y· 

, 

4. The supply elasticity of the other factor, Ey, used to produce VOLs, 

VOL products, or VOL storage. 

*The elasticity of demand is sometimes referred to as the own-price elasticity 

of demand to distinguish it from the influence of other prices and income 

changes that can affect demand. It may be defined mathematically as 

= oTD . f , where Tn is the rate at which tanks are demanded and P is 

nT aP T the pri~e of tanks. 

9-41 
TABLE 9-19. THE NEW TANK POPULATION IMPACTED BY REGULATORY ALTERNATIVE I 

AS A PERCENTAGE OF THE PROJECTED NEW TANK POPULATION 

Tank 

volume 

(m3)a 

75b to 95 

95 to 150 

150 to 375 

375 to 3,750 

3,750 to 15,000 

>15,000 

Percentage of new tank population 

Tanks with vapor pressure Tanks with vapor pressure 

between 3.5 and 10.3 kPa greater than 10.3 kPa 

2.73c 

1.47c 

1.85 0 

2.95 0 

0.46 0 

0.05 0 

aThe six volume intervals presented here are aggregates. Calculations 

are performed using the corresponding percentages from the 24 volume 

intervals of the 1977 survey. 2 7•28 

bTanks with volume less that 75 m3 are below the minimum cutoff point considered for Regulatory Alternative I. 

cThe percentages of projected new tank population for tanks with volume 

capacities between 75 and 95 m3 and between 95 and 150 m3 are for all 

tanks having vapor pressure greater than 3.5 kPa. 

9-42 
TABLE 9-20. THE NEW TANK POPULATION IMPACTED BY REGULATORY ALTERNATIVES II-V 

AS A PERCENTAGE OF THE PROJECTED NEW TANK POPULATION 

Tank Percentage of new tank population 

volume 

(m3)a 

Tanks with vapor pressures Tanks with vapor pressures 

75b to 95 

95 to 150 

150 to 375 

375 to 3,750 

3,750 to 15,000 

>15,000 

between 3.5 and 10.3 kPa greater than 10.3 kPa 

2.85 

4.56 

0.71 

0.07 

2.53d 

6.22d 

1.19d 

. 0.19d 

aThe six volume intervals presented here are aggregates. Calculations 

are performed using the corresponding percentages from the 24 volume 

intervals of the 1977 survey. 27 •28 

bTanks with volume less that 75m3 are below the minimum cutoff point 

sidered for this Regulatory Alternative I. 

concThe percentages of projected new tank population for tanks with volume 

capacities between 75 and 95 m3 and between 95 and 150 m3 are for all 

tanks having vapor pressure greater than 3.5 kPa. 

dThe baseline control assumptions specify that tanks with volume greater 

than 150 m3 and vapor pressures greater than 76 kPa have vapor control 

systems or are pressure ~essels. Since the upper vapor pressure interval 

of the 1977 sample intervals covered all tanks with vapor pressures greater 

than 59 kPa, there was no basis in the sample data to distinguish between 

tanks in that interval with vapor pressures greater than 76 kPa and those 

with vapor pressure less than 76 kPa. A working assumption that all the 

tanks in the upper interval had pressures between 59 and 76 kPa was adopted. 

Only a small number of tanks was affected by the assumption (0.22 percent 

of the total VOL tank population). 

9-43 
The lower these factors, the lower nT and, consequently, the less the quantity 

of tanks demanded will adjust to changes in the price of tanks. Each of these 

four considerations is discussed below for VOL storage tanks. 

First, as suggested by the relatively stable physical output in the face 

of rapidly rising prices in the industrial organic chemicals and plastics industries during the late 1970s (see Tables 9-4 and 9-5), the demand elasticity 

for VOLs, as a group, is probably fairly small. The qualifier 11 as a group 11 is 

i~portant in this context since most substitutes for the VOLs that do have good 

substitutes in particular applications are also likely to be VOLs. Storage of 

the substitutes would therefore also be subject to the standards. 

Second, the elasticity of substitution for bulk VOL storage is very small 

because alternative, low-cost means of providing the same service is not readily apparent.* This is especially the case with terminals since storage is 

their principal purpose. Most bulk VOL storage tanks either already have been 

or, under the regulatory alternatives, are about to be affected by standards 

of this type. Therefore, it is not feasible to substitute uncontrolled tanks 

for controlled tanks. The cost advantage enjoyed by large tanks (see Chapter 8) 

probably will also sharply limit substitution of uncontrolled small-volume tanks 

for the large-volume tanks affected by the regulatory alternatives. Finally, 

VOL storage service is a crucial part of the production and consumption of VOLs 

in that it is nearly a fixed component of a plant design. 

Third, the share of VOL storage costs in the production of VOLs or VOL 

products is also likely to be small. In the model producer/consumer plant 

described in Chapter 6, capital costs for VOL storage comprise between 2 and 

11 percent of total capital costs (depending on the regulatory alternative) 

and at most just over 1 percent ot total annual capital and operating costs. 

However, in the case of VOL storage terminals the share of tank costs in total 

costs is likely to be somewhat higher. 

Fourth, although the elasticity of supply for other factors used with VOL 

storage tanks is more problematic, recent world experience suggests that for 

*The elasticity of substitution is a measure of the proportionate change in 

the use of different factors of production in response to a proportionate 

change in the price ratio of those factors. In effect, it measures the 

feasibility and desirability of substituting one factor for another. 

There are a number.of different expressions for the elasticity of substitution, all fairly cumbersome. The interested reader is referred to 

Reference 34. 

9-44 
at least in one critical input category for VOL producers, that of petroleum 

feedstocks, the supply is relatively price inelastic.* 

Based upon these considerations, this economic impact analysis adopts the 

working assumption that the demand for VOL storage tanks is perfectly inelastic 

within the range of relevant tank prices. This demand condition is depicted 

in Figure 9-2 as demand curve D. In the event of a rise in the price of tanks 

from P to P', the demand for tanks and, hence, the number of impacted VOL stori 

age tanks will remain unchanged at the rate Tt per year. This characterization 

of tank demand is recognized to be extreme in the sense that, as noted above, 

one usually observes at least some reduction in demand in response to price 

increases for most commodities. However, there are no publicly available data 

on the prices and quantities of VOL storage tanks that can be used to estimate 

the elasticity of demand for storage tanks. Furthermore, if demand is treated 

as perfectly inelastic, the likely direction of any error associated with this 

assumption is known. That is, the impact of each of the regulatory alternatives 

on the cost of VOL storage is overestimated since if any nonzero elasticity 

of demand is used fewer new tanks would be projected and subject to the standards 

and additional cost. 

As illustrated by demand schedule 02 in Figure 9-2, the economic analysis 

allows for economic growth by specifying a shift in the demand for VOL storage 

tanks over time. As the economy grows, there will be some growth in the 

demand for VOL chemicals and, hence, for new and rep1acement VOL storage tanks. 

The magnitude of this growth between periods t and t+l is reflected in the 

demand curves for the respective periods and the difference Ti+l - T~ . The 5 

percent growth rate in new tank capacity demand and the tank replacement 

schedule, adopted for the projections in Section 9.1, are also adopted as the 

quantitative basis for these shifts in demand. 

As discussed above, data on the impacted VOL tank population for each 

regulatory alternative, year, pressure interval and volume interval determine 

the value ofT~ in Figure 9-2. The regression equations of cost against volume 

estimated in Chapter 8 for each regulatory alternative are then used to deter-

*The elasticity of supply is defined analogously to the elasticity of demand: 

the ratio of a proportionate change in the quantity supplied to a proportionate 

change in the supply price. For a discussion see Reference 35. 

9-45 
mine the change in the price of a tank in that volume interval, p• - P.* 

Multiplying T~ by p• - P gives an estimate of the area P1 abP in Figure 9-2. 

This is the estimated investment impact, in 1982 dollars, of the particular 

regulatory alternative in question on tanks in the given volume interval in 

the year t. These values are then summed over all the volume intervals to 

obtain the nationwide investment impact of the regulatory alternative in year 

t. Finally, annual investment values for the years 1984-1988 are summed to 

obtain an estimate of the cummulative nationwide investment impact for the 

projection period. 

Table 9-21 presents the resulting data on nationwide investment impacts 

for each regulatory alternative using this methodology. For comparison, the 

estimated investment in new VOL tanks covered by the baseline conditions (>75 

m3 and >3.5 KPa) exclusive of vapor recovery equipment or pressure vessel 

costs is also included. The investment impacts for Regulatory Alternatives II 

and III are the same because they are estimated in Chapter 8 to have the same 

impact on the cost of a tank. 

9.2.3 Nationwide Annualized Cost Impacts 

The total annual cost of each of the regulatory alternatives is dependent 

on the number of new tanks put in place over the five year period and the 

change in the annualized cost of each tank. The annualized cost represents 

the annual financial obligations imposed by the regulatory alternative on purchasers of VOL storage tanks. In particular, fifth-y~ar costs include payments 

related to the regulatory alternatives in the fifth year for debt and operating 

expenses associated with tanks purchased in each of the 4 previous years as 

well as those expenses newly incurred due to tank purchases in the fifth year. 

These costs, in constant 1982 dollars, are presented in the second column of 

Table 9-22. They range from 3.3 million dollars for Regulatory Alternative I 

to just over 26 million dollars for Regulatory Alternative V. 

*The change in price in this analysis is equivalent to a change in cost since 

tank fabricators will not contract to build new tanks unless their costs are 

covered by the price (see subsection 9.2.1 above). For those regression 

equations expressed in terms of diameter, an equivalent volumetric relationship was derived using a correspondence between diameter and height suggested 

by Reference 36. The change in the cost or price for any volume interval is 

estimated by using the mid-point of that interval in the regression equation. 

For the interval that is unboundered (>15,000 m3 ), a volume of 20,000 m3 was 

used. 

9-46 
TABLE 9-21. ADDITIONAL NATIONWIDE INVESTMENT IN VOL STORAGE 

REQUIRED BY THE REGULATORY ALTERNATIVES, 1984-1988 

Estimated 

investment Additional b 

under baselin5 nationwide investment 

assumptionsa, ($106 , constant 1982 dollars) 

($106 , constant 

Year 1982 dollars) I II & III IV v 

1984 41.94 2.70 2.75 4.70 21.67 

1985 43.86 2.87 2.93 4.96 22.69 

1986 44.31 2.93 2.99 5.04 22.97 

1987 45.92 3.07 3.14 5.27 23.84 

1988 52.04 3.39 3.46 5.86 26.84 

1984-1988 224.57 14.84 15.16 25.54 116.13 

aan estimate of the nationwide investment that would be made in new tanks 

with volumes > 75 m3 containing liquids with vapor pressures > 3.5 kPa 

without implementation of any of the regulatory alternatives. This estimate 

is exclusive of any investment in vapor recovery equipment or pressure 

vessels. 

bAnnual values are not dicounted to the present. 

9-47 
Regula tory 

alternative 

I 

II 

III 

IV 

v 

TABLE 9-22. FIFTH-YEAR NATIONWIDE ANNUALIZED COST OF 

THE REGULATORY ALTERNATIVES 

Fifth-year annualized cost 

($106 , constant 1982 dollars) 

Without With 

emission emission 

savings savinga 

credit credit 

3.25 -0.56 

3.34 -0.67 

3.34 -1.01 

6.11 1.68 

26.14 21.61 

aCredit computed using a VOL price of $460/Mg. 

9-48 
As discussed above, the tanks impacted by the regulatory alternatives 

will also generate some additional economic benefits for tank users because 

they reduce vaporization of valuable VOLs. The tank owners are better off by 

the amount of emissions reductions times the value of the chemical saved. 

Nationwide emissions reductions for each regulatory alternative in the fifth 

year after promulgation are estimated in Chapter 7. The $460/Mg estimate of 

the value of VOL was applied to these emissions reductions to obtain an 

estimate of the nationwide economic benefit of this emissions reduction to VOL 

tank users in 1988. The resulting emission savings credit was then applied 

against annualized costs; the results are shown in column 3 of Table 9-22. On 

a nationwide basis, the first three regulatory alternatives produce net economic benefits in 1988 when an emission savings credit is included in the calculation. The fact that the nationwide annual costs are negative is not inconsistent with the finding of positive costs of these alternatives for the two 

model plants since the model plants were selected so as to exhibit a greater 

than average economic impact. 

9.3 REGULATORY, INFLATIONARY, SOCIOECONOMIC, AND SMALL-BUSINESS IMPACTS 

9.3.1 Executive Order 12291 

Executive Order 12291 requires the conduct of a regulatory impact analysis (RIA) of a proposed regulation if the regulation is likely to result in 

1. An annual effect on the economy of $100 million or more. 

2. A major cost or price increase for consumers; individual industries; 

Federal, State, or local government agencies; or geographic regions. 

3. Significant adverse effects on competition, employment, investment, 

productivity, innovation, or ability of United States-based enterprises to compete with foreign-based enterprises in domestic or 

foreign markets. 

Estimated nationwide investment impacts on tank purchases listed in Table 

9-21 show that, for all years from 1983 through 1988 and all regulatory alternatives, the investment impact would be substantially less than $100 million per 

year. When the capital costs associated with the regulatory alternatives are 

annualized and credit is given for reduction in VOL vaporization, it is estimated that the first three regulatory alternatives actually generate nationwide cost savings in 1988 (see Table 9-22). Regulatory Alternatives IV and V 

show nationwide annualized cost increases after credit for emission savings of 

9-49 
$1.61 x 106 and $21.61 x 106, respectively. These are very small figures 

compared to the investment and sales levels of VOL storing industries. 

Percentage price increases for the model terminal are higher than those 

for a model producer/consumer but were still less than 5 percent for Regulatory 

Alternatives I through IV after emission savings credits. Regulatory Alternative V was estimated to increase the price of storage at the model terminal by 

13.2 percent without an emissions reduction credit and by 11.8 percent with 

such a credit. 

Based on these results, the proposed standards do not qualify as major 

regulatory alternatives under the criteria enumerated above: the annual 

effect on the economy is substantially less than $100 x 106 , the price impacts 

are small, and the standard will not have a significant effect on the operation of the domestic economy or its international trade. Therefore, a regulatory impact analysis and associated benefit/cost calculations need not be performed. While this is the case, it is still worthwhile to note, in a qualitative fashion, the benefits against which the costs discussed above should be 

balanced. 

The standards will reduce the rate of emission of VOLs to the atmosphere. 

These compounds are precursors of photochemical oxidants, particularly ozone. 

The EPA publication Air Quality Criteria for Ozone and Other Photochemical 

Oxidants37 explains the effects of exposure to elevated ambient concentrations 

of oxidants. (The problem of ozone depletion of the upper atmosphere and its 

relation to this standard are not addressed here.) These effects include 

1. Human health effects. Ozone exposure has been shown to cause 

increased rates of respiratory symptoms such as coughing, 

wheezing, sneezing, and short-breath; increased rates of headache, eye-irritation and throat irritation; and increases in 

the number of red blood cells. One experiment links ozone 

exposure to damage to human chromosomes. 

2. Vegetation effects. Reduced crop yields as a result of damges 

to leaves and/or plants have been shown for several crops 

including citrus, grapes, and cotton. The reduction in crop 

yields was shown to be linked to the level of duration of ozone 

exposure. 

3. Materials effects. Ozone exposure has been shown to accelerate 

the deterioration of organic materials such as plastics and 

rubber (elastomers), textile dyes, fibers, and certain paints 

and coatings. 

9-50 
4. Ecosvstem effects. Continued ozone expoure has been shown to 

be linked to the disappearance of trees such as Ponderosa and 

Jeffrey Pines and death of predominant vegetation. Hence continued ozone exposure places a stress on the ecosystem. 

In addition to reducing the severity of the physical and biological effects 

enumerated above, the regulatory action is likely to improve the aesthetic and 

economic value of the environment through, for example, beautification of natural 

and undeveloped land because of increased vegetation, improved visibility, and 

reduced incidence of noxious odors. 

9.3.2 The Regulatory Flexibility Act 

The Regulatory Flexibility Act requires the conduct of a regulatory flexibility analysis (RFA) if a substantial number of small firms are significantly 

adversely impacted by the regulatory alternatives examined. In Chapter 6, the 

model independent terminal and model producer/consumer were identified as small 

facilities. The economic impact of regulatory alternatives on these facilities 

was not found to be significant. 

9.4 REFERENCES 

1. Scherer, F.M. Industrial Market Structure and Economic Performance. 

Chicago, Rand McNally College Publishing Company, 1980. 

2. Hegman, George B. In: World Outlook for Petrochemicals. Cambridge, 

Arthur D. Little, Inc., August 1978. p. 7. 

3. U.S. Department of Commerce, Bureau of the Census. 1977 Census of Manufactures. Part 2, SIC Major Groups 27-34. U.S. Government Printing 

Office. Washington, DC. 1981. p. 28F-13. 

4. Booz, Allen, and Hamilton, Inc. Cost of Hydrocarbon Emissions Control to 

the U.S. Chemical Industry (SIC 28). Exhibit VI-6. Florham Park, NJ. 

December 1977. 

5. U.S. Department of Commerce, Bureau of Economic Analysis. 1972 InputOutput Tables: Structure of the U.S. Economy. U.S. Government Printing 

Office. Washington, DC. 

6. U.S. Department of Commerce, Bureau of the Census. 1972 Census of Manufactures. Volume 11, Industrial Statistics, Part 2, SIC Major Group 27-34. 

U.S. Government Printing Office. Washington, DC. p. 28F-13-28F-15. 

August 1976. 

7. Memorandum from Hart, Marge, National Association of Chemical Distributors, to Rockstroh, Margie, TRW, Inc. 1980. 

8. Independent Liquid Terminals Association. 1982 Bulk Liquid Terminals 

Directory, 7th Edition. Washington, DC. 1982. 99 p. 

9. Reference 3, p. 28F-5, 288-5. 

10. Fallwell, William F. Chemical Capital Spending to Turn up in 1979. 

Chemical and Engineering News. 56:10-12. December 11, 1978. 

9-51 
11. U.S. Department of Commerce, Bureau of the Census. Business Statistics, 

1977. U.S. Government Printing Office. Washington, DC. 1979. p. 46. 

12. Reference 6, p. 28F-5, 288-5. 

13. Operating Rate. Chemical and Engineering News. 56:59. June 11, 1979. 

14. U.S. International Trade Commission. U.S. Production and Sales--Synthetic 

Organic Chemicals (for the years 1955 through 1981). Table 1. U.S. 

Government Printing Office. Washington, DC. 

15. U.S. Department of Commerce, Bureau of Industrial Economics. 1982 U.S. 

Industrial Outlook. U.S. Government Printing Office. Washington, DC. 

January 1982. p. 102-103. 

16. Reference 15, p. 120, 141, 316. 

17. Radian Corporation. Organic Chemical Producers Data Base, 1976. 

Research Triangle Park, NC. Contract No. 68-02-2623. 1978. 

18. Reference 6, p. 28F-8, 28F-9. 

19. Reference 3, p. 28F-7, 28F-8. 

20. Reference 6, p. 288-7, 288-8. 

21. Reference 3, p. 28B-8, 28B-9. 

22. U.S. Department of Labor, Bureau of Labor Statistics. Producer Prices 

and Price Indexes. Supplements 1978-1982 (data for 1977 to 1981). U.S. 

Government Printing Office. Washington, DC. 

23. U.S. Environmental Protection Agency. VOC Fugitive Emissions in Synthetic 

Organic Chemicals Manufacturing Industry-Background Information for 

Proposed Standards. Research Triangle Park, NC. EPA-450/3-80-033a. 

November 1980. p. 9-1-9-36, E-1-E-11. 

24. U.S. Environmental Protection Agency. Fugitive Emission Sources of 

Organic Compounts--Additional Information on Emissions, Emission 

Reductions, and Costs. Research Triangle Park, NC. EPA-450/3-82-010. 

April 1982. p. A-1-A-23. 

25. Federal Reserve Statistical Release Industrial Production, G.12.3. Board 

of Governors of the Federal Reserve System. Washington, DC. 1954-1977 

(monthly). 

26. Predicasts, Inc. Predicasts Basebook. Cleveland, OH. 1960-1980. 

27. Hydroscience, Inc. Emissions Control Options for the Synthetic Organic 

Chemicals Manufacturing Industry: Storage Handling Report. Knoxville, 

TN. March 1979. 

28. Letter from Rockstroh, M.A., TRW, Inc., to Smith, V., RTI. July 10, 

1980. 

29. Telecon. Anderson, Don, RTI, with Greek, Bruce, American Chemical 

Society. October 29, 1982. 

30. Telecon. Anderson, Don, RTI, with Pfann, Harry, Department of Commerce. 

October 29, 1982. 

31. Letter from Rockstroh, M.A., TRW, to Moody, W.T., TRW. February 1, 1980. 

32. Radian, Inc. The Revised Organic Chemical Producers Data Base System, 

Final Interim Report. Austin, Texas. EPA Contract No. 68-03-2623. 

March 1979. 

9-52 
33. Letter from Shumaker, J., TRW, to Morris, G. E., RTI. January 3, 1983. 

34. Layard, P.R.G., and A.A. Walters. Microeconomic Theory. New York, 

McGraw-Hill Book Company, 1978. p. 260-270. 

35. Reference 33, p. 221-230. 

36. Memorandum from Moody, W.T., TRW, to Morris, G. E., RTI, December 17, 

1982. 

37. Air Quality Criteria for Ozone and other Photochemical oxidants. U.S .. Environmental Protection Agency. Publication No. EPA-600/8-78-004. 

April 1978. 

9-53 
APPENDIX A - EVOLUTION OF 

THE BACKGROUND INFORMATION DOCUMENT 
A1. Literature Review 

November 1978 

November 22, 1978 

December 1979 

January 1980 

January 1980 

January 1980 

January 1980 

January 1980 

January 1980 

January 1980 

Hydroscience Inc. Emission Control Options for 

the Synthetic Organic Chemicals Industry - Storage and Handling Report, October, 1979. 

Letter with attached report from Kern, R. C. 

November 22, 1978, Ultraflote, to R. K. Burr, 

EPA:CPB, Hydrocarbon Emission Loss Measurements 

on a 20 Foot Diameter Pilot Test Tank with an 

Ultraflote and a CBI Weathermaster Internal 

Floating Roof. 

Letter and attachment from Lee, B., Radian 

Corporation, to Moody, W. T., TRW:EED. 

November 30, 1979. Letter transmitting 

updated version of the report generated August 

1978 from the Organic Chemical Producers Data 

Base. 

Evaporation Loss in the Petroleum Industry - Causes and Control, Evaporation Loss Committee, 

American Petroleum Institute, February 1959. 

Evaporation Loss from Floating-Roof Tanks, 

Evaporation Loss Committee, American Petroleum 

Institute, February 1962. 

Petrochemical Evaporation Loss from Storage 

Tanks, Division of Refining, American Petroleum 

Institute, November 1969. 

Venting Atmospheric and Low-Pressure Tank 

(Nonrefrigerated and Refrigerated), Refining 

Department, American Petroleum Institute, 

December 1973. 

Use of Internal Covers and Covered Floating 

Roofs to Reduce Evaporation Loss, American 

Petroleum Institute, 1976. 

Measurement and Determination of Hydrocarbon 

Emissions in the Course of Storage and Transfer 

in Above-Ground Fixed Cover Tanks With and 

Without Floating Covers, BMI-DGMK Projects 

4590-10 and 4590-11, Translated for EPA by 

Literature Research Company, 1976. 

Hydrocarbon Emissions from Floating Roof 

Petroleum Tanks, Western Oil and Gas 

Association, January 1977. 

A-2 
January 1980 

February 1980 

February 1980 

February 1980 

February 1980 

April 1980 

March 1980 

June 1980 

June 1980 

June 1980 

June 1980 

Cost of Hydrocarbon Emissions Control to the 

U.S. Chemical Industry (SIC 28), Volumes I and 

II, Manufacturing Chemists Association, 

December 1977. 

Control of Volatile Organic Emissions from 

Storage of Petroleum Liquids in Fixed-Roof 

Tanks, EPA-450/2-77-036, EPA:CPB, December 

1977. 

Evaluation of Hydrocarbon Emissions from 

Petroleum Liquid Storage, EPA-450/3-78-012, 

R. K. Burr, EPA:CPB, March 1978. 

Suggested Emission Factors for Fixed-Roof 

Storage Tanks, A. L. Wilson, EngineeringScience, Inc., November 13, 1978. 

Control of Volatile Organic Emissions from 

Petroleum Liquid Storage in External Floating 

Roof Tanks, EPA-450/2-78-047, EPA:CPB, 

December 1978. 

The Revised Organic Chemical Producers Data 

Base System, EPA Contract No. 68-02-2623 

(Radian Corporation), A. Jefcoat, EPA:IERL, 

March 31, 1979. 

Comments on the 11 BMI-DGMK11 Report, J. Zabaga, 

Mobile Oil Company, June 16, 1978. 

Bulk Liquid Terminals and Storage Facilities, 

Independent Liquid TeTminals Association, 1979 

(Directory). 

Emissions Control Options for the Synthetic 

Organic Chemicals Manufacturing Industry, 

Thermal Oxidation, (Draft), EPA Contract 

No. 68-02-2577, EPA:ESED, December 1979. 

Emissions Control Options for the Synthetic 

Organic Chemicals Manufacturing Industry, 

Carbon Adsorption (Draft), EPA Contract 

No. 68-02-2577, EPA:ESED, February 1980. 

Emissions Control Options for the Synthetic 

Organic Chemicals Manufacturing Industry, 

Thermal Oxidation Supplement (Draft), EPA 

Contract No. 68-02-2577, EPA:ESED, February 1980. 

A-3 
A2. Information from Other Sources 

January 1979 

April 1979 

September 1979 

October 1979 

December 1979 

December 1979 

March 1980 

March 1980 

March 1980 

April 1980 

H. F. Ellenburg, Instrumentation Products Co., 

to l. Hayes, TRW:EED, December 20, 1978, letter 

with enclosed information on vapor recovery 

systems for storage tanks and solvent transfer 

facilities. 

T. W. Mix, Merix Corporation to R. K. Burr, 

EPA:CPB, April 21, 1979, letter with enclosed 

summary print-out of input and output losses of 

above-ground gasoline tanks on farms. 

B. Lee, Radian Corporation, toW. T. Moody, 

TRW:EED, August 31, 1979, Letter with enclosed 

information from the Organic Chemical Producers 

Data Base. 

J. K. Walters, American Petroleum Institute, to 

R. K. Burr, EPA:CPB, September 14, 1979, letter 

with enclosed technical comments of the American 

Petroleum Institute on the draft report 

"Measurement of Benzene Emissions from a 

Floating Roof Test Tank." 

M. Rutland, GATX, toR. Guidetti, TRW:EED, 

December 3, 1979, letter concerning budgetary 

prices for standard API-650 Cone Roof Tanks 

and Floating Roof Tanks. 

E. B. Dees, TRW:EED, toM. R. Frega, Frega 

Associates, Inc., December 6, 1979, Letter 

requesting information to be used in an industry 

profile for volatile organic liquids storage. 

H. Reiss, Altech Industries, Inc., to G. May, 

TRW:EED, February 26, 1980, letter with 

summarized budget price information. 

T. P. Tremblay, Chicago Bridge & Iron Company, 

toW. T. Moody, TRW:EED, February 27, 1980, 

Letter concerning price differentials 

Weathermaster Floating Roof Tank versus cone 

roof tank-revision 1.0. 

T. T. Fung, Systems Division, to M. A. Rockstroh, 

TRW:EED, March 14, 1980, Letter concerning 

acetone storage tank emissions control study. 

J. J. Dechant, Brown Boiler & Tank Works, /Ltd., 

to TRW:EED, March 27, 1980, Letter concerning 

quotation with budget figures in order to erect 

acetone storage tanks. 

A-4 
May 1980 

May 1980 

June 1980 

June 1980 

June 1980 

June 1980 

July 1980 

July 1980 

October 1982 to 

December 1982 

January 1983 

J. R. Farmer, EPA:CPB, to R. L. Stuart, 

Monsanto Company, April 28, 1980, Letter 

with enclosed background information to 

support the volatile organic liquids regulation 

with attached list of addressees. 

Comments on the Volatile Organic Liquids 

Background Information, H. D. Kerfman,GATX, 

May 1980. 

L. P. Hughes, Mobay Chemical Corporation, 

toW. T. Moody, TRW:EED, May 29, 1980, 

Letter with enclosed responses regarding 

possible tank emission recovery systems. 

Dr. F. S. Lisella, Department of Health and 

Human Services, to J. R. Farmer, EPA:CPB, 

June 2, 1980, Letter commenting on the 

draft copy of Volatile Organic Compound 

Emissions from Volatile Organic Liquid 

Storage Tanks. 

R. E. Kinghorn, R.F.I. Services Corp., to 

W. T. Moody, TRW:EED, June 9, 1980, Letter 

concerning prices for conventional cone 

roof tanks constructed to API 650 code. 

T. P. Tremblay, Chicago Bridge & Iron Company, 

toW. T. Moody, TRW:EED, June 22, 1980, 

Letter concerning price differentials 

Weathermaster Floating Roof Tank versus 

cone roof tank. 

R. Harrison, Western Oil and Gas Association, 

to J. R. Farmer, EPA:ESED, June 27, 1980, 

Letter commenting on the draft document 

"Volatile Organic Compound Emissions from 

Volatile Organic Liquids Storage Tanks. 11 

J. K. Walters, American Petroleum Institute, 

to J. R. Farmer, EPA:ESED, June 30, 1980, 

Letter commenting on the draft document 11 Vo 1 at il e Organic Compound Emissions from 

Volatile Organic Liquids Storage Tanks. 11 

Updated costs of control equipment obtained 

from 15 vendors. 

W. F. O'Keefe, American Petroleum Institute 

(API) to S. R. Wyatt, EPA:ESED, Letter 

concerning emissions calculations (including 

final API Bulletin 2519 evaporation loss 

from internal floating roof tanks). 

A-5 
A3. Emission Source Measurement 

May 1979 

June 1979 

August 1979 

March 1982 

Emission Measurements on a Floating Roof 

Pilot Test Tank, R. J. Laverman, Chicago 

Bridge & Iron Company, May 16, 1979. 

Measurement of Benzene Emissions from a 

Floating Roof Test Tank, EPA-450/3-79-020, 

R. K. Burr, EPA:CPB, June 1979. 

Hydrocarbon Emission Measurements of Crude 

Oil on the 20 Foot Diameter Floating Roof 

Pilot Test Tank, R. J. Laverman, Chicago 

Bridge & Iron Company, August 15, 1978. 

Testing Program to Measure Hydrocarbon 

Emissions From A Controlled Internal Floating 

Roof Tank, for American Petroleum Institute 

Committee on Evaporative Loss Measurement 

Task Group 2519, R. J. Laverman, T. J. Haynie, 

and J. F. Newbury, Chicago Bridge & Iron 

Company, March 1982. 

A-6 
A4. Plant and Other Related Trips 

November 14-17, 1978 

November 15, 1978 

November 15, 1978 

August 14, 1980 

August 20, 1980 

August 21, 1980 

August 26, 1980 

Trip to Hydroscience Inc., to discuss data 

base and Phase I report. 

Trip to Exxon Chemicals, Baton Rouge, Louisiana, 

to obtain information on the rail car loading 

facility. 

Trip to Gilmore Maxine Services, Baton Rouge, 

Louisiana, to inspect a barge cleaning facility. 

Trip to Conoco Chemical, Baltimore, Maryland, to 

inspect a vapor recovery system. 

Trip to Vulcan Materials, Geismar, Louisiana, to 

inspect a vapor recovery system. 

Trip to Amoco Chemical, Texas City, Texas, to 

inspect a vapor recovery system. 

Trip to Dow Chemical, Midland, Michigan, to 

inspect two vapor recovery systems. 

A-7 
AS. Meetings with Industry 

March 20, 1979 

August 9, 1979 

September 2, 1982 

December 15, 1982 

January 26, 1983 

Meeting with Dow Chemical Corporation to 

discuss small vessel (~20,000 gallon) 

control techniques and industry trends. 

Meeting with the Chemical Manufacturers 

Association to discuss the regulatory 

approach and control technologies. 

Meeting with the American Petroleum Institute 

to discuss 1) the analytical approach used 

by API in developing storage vessel emission 

factors for the Bulletin 2519 11 Evaporative 

Loss from Internal Floating Roof Tanks"; 

2) the EPA approach for emission factors 

development; and 3) the effect of roof 

configuration upon emissions. 

Meeting with the American Petroleum Institute 

to discuss EPA study and review of internal 

floating roof vessel emissions and the API 

testing program. 

Meeting with the American Petroleum 

Institute (API) to discuss the new API 

testing preliminary data available on 

floating roof vessel emissions. 

A-8 
A6. Reports and Review Process 

December 14, 1978 

January 29, 1979 

March 14, 1979 

August 1979 

November 29, 1979 

January 18, 1980 

March 26, 1980 

June 20, 1980 

October 1980 

December 3, 1980 

December 1980 

April 2, 1981 

October 1981 

March 1983 

J. L. Shumaker, EPA:CPB, to V. Smith, Research 

Triangle Institute, Letter concerning the 

finalization of SOCMI to be used in all 

generic standards. 

E. C. Pulaski, TRW:EED, to V. Smith, Research 

Triangle Institute, Letter with enclosed 

model facilities for synthetic organic 

chemical storage facilities. 

R. C. Weber, EPA:CPB, to E. Pulaski, TRW:EED, 

Letter confirming deletion of Handling 

portion or SOCMI Storage and Handling NSPS. 

Decision to expand SOCMI storage to VOL. 

W. T. Moody, TRW:EED, to the Volatile Organic 

Liquids Docket Files, Memo with an attached 

selection of Model Facilities. 

W. T. Moody, TRW:EED, to the Volatile Organic 

Liquids Docket Files, Memo concerning tanks 

involved in industrial organics. 

Model Plants and Regulatory Alternatives are 

finalized. 

Decision on the basis of the standard. 

Working Group Review. 

National Air Pollution Control Techniques 

Advisory Committee Meeting. 

Steering Committee Review. 

Assistant Administrator Review. 

Package withdrawn from review process and 

returned to OAQPS. 

Steering Committee review of the revised 

standard based upon newly available emissions 

information. 

A-9 
APPENDIX B - INDEX TO ENVIRONMENTAL IMPACT CONSIDERATIONS 
OJ 

I 

N 

Table B-1. INDEX TO ENVIRONMENTAL IMPACT CONSIDERATIONS 

Agency Guidelines for Preparing Location Within the Background Information Document (BID) 

Regulatory Action Environmental 

Impact Statements (39 FR 37419) 

1. 

2. 

Background, description, and 

purpose of the regulatory 

alternatives and the statutory 

authority. 

The relationship to other 

actions and proposals significantly affected by the regulatory alternatives. 

Industry affected by the 

regulatory alternatives. 

Specific processes affected 

by the regulatory alternatives. 

Applicable control technologies 

Alternatives to the action. 

The regulatory alternatives from which standards will be chosen 

are summarized in Chapter 1, Section 1.1. 

To the extent possible, other EPA regulations and OSHA regulations which apply to the affected industries are detailed in 

Chapter 8, Section 8.5 and are considered in the economic impact 

study in Chapter 9. 

The industry and emission sources within the industry affected 

by the regulatory alternatives are listed in Chapter 3. 

The specific processes and facilities affected by the regulatory 

alternatives are summarized in Chapter 3, Section 3.2. 

The control technologies which can be applied to reduce VOC 

emissions from storage tanks and the emission reductions which 

have been achieved by these control technologies are described 

in detail in Chapter 4. 

The various categories of alternatives to the actions which 

were considered are listed below. 

a. Alternative regulatory approaches. The alternative 

approaches for regulating VOC emissions under Section 111 of 

the Clean Air Act are outlined in Chapter 6. 

b. Alternative control devices. The alternative control 

devices that could be required by the regulatory alternatives 

and the reasons for selecting these particular alternatives 

are outlined in Chapter 4. 

(continued) 
OJ 

I 

w 

Agency Guidelines for Preparing 

Regulatory Action Environmental 

Impact Statements (39 FR 37419) 

Agency's comparative evaluation 

of the beneficial and adverse 

environmental, health, social, 

and economic effects of each 

reasonable alternative. 

3. Environmental impact of the 

regulatory alternatives. 

a. Primary impact. 

Primary impacts are those that 

can be attributed directly to 

the action, such as reduced 

levels of specific pollutants 

brought about by a new standard 

and the physical changes that 

occur in the various media with 

this reduction. 

Table B-1. Continued 

Location Within the Background Information Document (BID) 

a. A discussion of the Agency's comparative evaluation of the 

various alternative regulatory approaches for VOC emissions 

from VOC storage vessels can be found in Chapter 7, 8, and 9. 

b. A summary of the beneficial and adverse environmental 

effects of the regulatory alternatives can be found in 

Chapter 7. A detailed description of the cost of each 

alternative control level, including the capital and 

annualized costs, can be found in Chapter 8. The 

socioeconomic impacts of the regulatory alternatives 

including potential plant closures and maximum price 

increases in consumer products, can be found in Chapter 9. 

Air impact analysis shows the primary impacts in Chapter 7, 

'section 7.2. 

(continued) 
OJ 

I 

+::> 

Agency Guidelines for Preparing 

Regulatory Action Environmental 

Impact Statements (39 FR 37419) 

b. Secondary impact. 

Secondary impacts are indirect 

or induced impacts. For example, 

mandatory reduction of specific 

pollutants brought about by a 

new standard could result in the 

adoption of control technology 

that exacerbates another pollution 

problem and would be a secondary 

impact. 

4. Other considerations. 

a. 

b. 

Adverse impacts which cannot 

be avoided should a regulatory 

alternative be implemented. 

Irreversible and irretrievable 

commitments of resources that 

would be involved with the 

regulatory alternatives, should 

one be implemented. 

Table B-1. Concluded 

Location Within the Background Information Document (BID) 

Other environmental impacts of the individual controls that can 

be used to meet the regulatory alternatives are identified 

qualitatively in Chapter 7, Sections 7.3, 7.4, and 7.5. 

The secondary water impacts of the alternative control levels 

are quantified in Chapter 7, Section 7.3. 

The energy consumption impact of the alternative control levels 

is quantified in Chapter 7, Section 7.4. 

A summary of the potential adverse environmental and health 

impacts of the regulatory alternatives and a discussion of 

the significance of each impact can be found in Chapter 7. 

·Factors which already exist to eliminate some of the 

potential adverse impacts are identified. Those adverse 

impacts that are unavoidable are also identified, along 

with any steps which can be taken to minimize them. 

Irreversible and irretrievable resources that would be involved 

in the proposed action are discussed in Chapter 7, Section 7.5.1. 
eN VI RON MENTAl' 

PROTECTION 

AG~NCY 

DALLAS, TE XA ~ 

LIBRARY 
l.a.u.·u. -

TECHNICAL REPORT DATA "•n ... '••v•~:rwfA 

(Please read Jnsrrucnons u•: the rc1 au before complrringl (:JRQTfCTION 

REPORT NO. ,2. 3 RECIPIENT'S ACCESSION NOAGENCY 

EPA-450/3-81-003a --- TITLE AND SUBTITLE 5 REPORT DATE • ' ! I ~C' 'lT)(A • "'o< , .. ~:, ... : s 

VOC Emissions from Volatile Organic Liquid Storage 6 PERFORM11'.1G ORGANIZATI()riJR,A]l Tanks - Background Information for Proposed Standards l~~- y AUTHOR(SI 8. PERFORMING ORGANIZATION REPGRT NO 

PERFORMING ORGANIZATION NAME AND ADDRESS 10. PROGRAM ELEMENT NO. 

Office of Air Quality Planning and Standards 

Environmental Protection Agency 11. CONTRACT/GRANT NO. 

Research Triangle Park, North Carolina 27711 68-02-3063 

. SPONSORING AGENCY NAME AND ADDRESS 13. TYPE OF REPORT AND PERIOD COVERED 

DAA for Air Quality Planning and Standards Draft 

Office of Air, Noise, and Radiation 14. SPONSORING AGENCY CODE 

u.s. Environmental Protection Agency EPA/200/04 Research Triangle Park, North Carolina 27711 . SUPPLEMENTARY NOTES 

. ABSTRACT 

Standards of Performance for the control of VOC emissions from Volatile Organic 

Liquid (VOL) storage tanks are being proposed under the authority of Section 111 

of the Clean Air Act. These standards would apply to all new and'existing storage 

tanks having a capacity of 75 cubic meters or larger, which are to be used for the 

storage of VOL. This document contains background information and environmental 

and economic impact assessments of the regulatory alternatives considered in 

developing the proposed standards . 

. 

-- KEY WORDS AND DOCUMENT ANALYSIS 

DESCRIPTORS b. IDENTIFIERS/OPEN ENDED TERMS (. COSA Tl held/Group 

ir pollution t:.qu1pment stanaara 

)llution control Standards of Performance 

torage tanks Air Pollution Control 13 B 

Jntact floating roofs 

1emi ca 1 manufacturing plants 

Jlatile Organic Compounds 

)latile Organic Liguids Jlk Liauid Terminals 

DISTRIBUTION STATEMENT 19. SECURITY CLASS (ThisRepon) 21 NO. OF PAGES 

Unclassified 199 Unlimited 20 SECURITY CLASS (ThiS page) 22. PRICE 

Unclassified 

A Form 2220-J {Rev. "-771 PREVIOUS EDITION IS OBSOLETE