p. 1


# OAR Box 

# 1875 Prepped byOllie Stewart



### Document

Number: 

# 67 ) ll-F-1 4 Docket Number: 

# A-90-1 9

Printed 12/1/200811:12:48AM

Sheet 67 of 86P. 2 

## A-90-1 9 ll-F-14

Not e to : TroyHillier , OM B From : Ja nMeyer , EP A Date : Octobe r 8 , 199 2 

# /X~~ m 

# n ° Subject : Transmitta l o f Requeste d Material s fo r 1229 1 Revie wo f

th e HON Attache d pleas e find : 1 ) a draf t analysi s o f th e cost s associate d wit hth e monitoring , recordkeeping an d reporting requirement s i n th e HON ; an d 2 ) a summaryo f th e banking provision s tha t EPAi s planning o nadding t o th e HO Na s a resul t o f ou r previou s discussions . Thes e material s ar e being submitte d t o yo u fo r you r revie wa s par t o f OMB' s on-going reviewo f th e HONunde r Executiv e orde r 12291 . I f yo u hav e question s abou t eithe r attachment , pleas e contac t m e a t (919 ) 541-5254 . cc : Daphn e McMurre r Ala nRus h 

# EJLSSJJLX

EPAAJRDOC^i LP. 3

,\t O Sr,,

_ f^ x UNITE D STATE S ENVIRONMENTA LPROTECTIO N AGENC Y

Offic e o fAi rQualit yPlannin g an d Standard s Researc h Triangl e Park
. Nort h Carolin a2771 1 

# USB ;

MEMORANDU

M SUBJECT : Presentatio n o f HO NMonitoring/Recordkeeping/Reporting Cost s



# —

y FROM : LarrySorrel s ,^^-t.^ ^ <r4

-

SDB , CEI S (MD-13 ) •'• / ' TO : TroyHillier , OMB Thi s memorandu

m explain s the calculatio no f nationa l cost s o f monitoring , recordkeeping , an d reporting fro

mcomplianc e wit h the HON . Estimate s o f hour s pe r ite m(require d action) , frequencype r year , an d numbe r o f respondent s use d i nthe cos t calculation s wer e prepare d i nconsultatio nwit hpeopl e wh o routinel ywor k wit ho r consul t majo r chemica l firm s o r hav e considerabl e experienc e wit hsuchfirms . T o comput e th e cost s associate d wit hth e burde n estimates , a wag e rat e o f $3 2 pe r hour ($1990 ) wa s assumed . Thi s assumptio n wa s base d o n8 5 percen t o f the labo r accomplishe d b ytechnica l personne l (typicall yanenginee r a t $3 3 pe r hour) , 1 0 percen t accomplishe d b

ya manage r (a t $4 9 pe r hour) , an d 5 percen t clerica l (a t $1 5 pe r hour) . Al l o f th e wag e rate s include an additiona l 11 0 percen t fo r overhead . Cost s wer e annualize d assuming anexpecte d remaining lif e fo r affecte d facilitie s o f 1 5 year s fro

mHONpromulgatio n(officiall yNovembe r 1992) , an d using aninteres t rat e o f 1 0 percen t i naccordanc e wit hOMB guidelines . The annualizatio no f cost s too k int o accoun t th e differen t starting point s fo r complianc e requirements . Fo r example , facilitie s mus t develop implementatio nplan s fo r monitoring , recordkeeping , an

d reporting b

y1 2 o r 1 8 month s befor e the complianc e date . Th e starting poin t fo r annualizing thes e cost s i s take na s Novembe r 1993 ; thi s i s th e conservativ e assumptio n tha t facilitie s wil l develop implementatio nplan s b ythe earlies t possibl e time . Complianc e requirement s var yi nterm s o f frequency , an d ar e take nint o accoun t i nth e annualizatio no f costs . Performanc e test s t o demonstrat e complianc e wit hth e contro l devic e requirement s ar e require d once . Complianc e requirement s als o includ e monitoring o f operating parameter s o f contro l device s an d record s o f wor k practic e an d othe r inspections . Thes e activitie s mus t b e reporte d semiannually . Th e complianc e requirement s tha t ar e t o b e don e bu t onc e ar e annualize d ove r th e time fro mtheP. 4

yea r i nwhichtheyar e t o tak e plac e t o th e expecte d en d o f facilitylif e (Novembe r 2007) . Spreadsheet s showing th e breakdow no f th e burde nonaffecte d facilitie s an

d th e cos t o f th e burde nrequirements , a s wel l a s the assumption s behind th e cos t calculations , th e breakdow no f cost s ona

n annua l basis , an

d a lis t o f complianc e date s ar e in Attachmen t A . Th e assumption s behin d th e burde n estimate s ar e listed i nAttachmen t B . 2 Attachment s cc : Doug Bell , SDB Le s Evans , CP B Linda Herring , SDB Daphn e McMurrer , SD B JanMeyer , SDB Bil l Vatavuk , SDB To mWalton , SDB A l Wehe , SDBP. 5

Attachment A Annua l Cos t fo r Year s 1-1 5 afte r HO NPromulgatio n

Yea r Afte r Promulgatio n 1 2 3 4- 5 6-1 5 Annua l Cos t $3,36 6 7,180,83 8 12,586,84 7 48,139,46 2 48,136,06 5 Th e fifthyear cos t wil l b e $48,139.462 . Assumption s fo r th e M/R/ RCos t Calculation s 1 . Th e interes t rat e use d i s 1 0 percent . 2 . Th e expecte d remaining lif e afte r promulgatio n (Novembe r 1992 ) fo r facilitie s affecte d b yth e HONi s 1 5 years . 3 . Annualizatio no f cost s wa s compute d fo r differen t time period s du e t o differen t starting point s fo r require d HONmeasures . Se e "Complianc e Date s fo r th e Variou s Requirements " below . Th e complianc e dat e fo r eac h requiremen t wa s take na s th e starting poin t fo r annualizing th e cost s i nmeeting eac h requirement . Cost s ar e incurre d a t th e beginning o f a year , a conventio nfro

mengineering economy . Thi s i s N o growt hprojection s ar e included , fo r i t i s no t advisabl e t o projec t growt hs o far (beyon d 5 years ) int o th e future .P. 6

Annualize

dCos t Breakdow

n Fo r Yea r 1 (afte r promulgation)

- Th e annualize d cos t o f initia l notification . Fo r Yea r 2

- Th e su

mo f Yea r 1 costs , th e annualize d cos t o f implementatio n plans , an d th e annua l cos t o f dat a gathering fo r equipmen t leaks . Fo r Yea r 3

- Th e su

mo f Yea r 2 costs , th e annualize d cos t o f complianc e notificatio n fo r al l emissio npoints , an d th e annualize d cos t fo r notice s o f ne wsourc e construction . Fo r Year s 4 an

d 5

- Same a s Yea r 3 . Fo r Year s 6 through15

- Same a s Year s 4 an d 5 , excep t ther e i s n o annualize d cos t fo r notice s o f ne wsourc e construction .

Complianc e Date s fo r th e Variou s Requirement s Initia l notificatio nmus t occu r b y9 0 day s afte r issuanc e o f th e fina l rul e (or Februar y1993) . Animplementatio n plan(or permi t application ) mus t b e submitte d b

y1 2 o r 1 8 month s befor e th e complianc e date . Th e complianc e dat e fo r al l emissio npoint s excep t equipmen t leak s i s thre e year s afte r promulgatio n(fo r thi s analysi s assume d t o b e Novembe r 1995) . Th e complianc e dat e fo r equipmen t leak s i s tw o year s afte r promulgatio n(Novembe r 1994) . Complianc e notificatio nmus t occu r b yNovembe r 1995 . Dat a gathering fo r al l emissio npoint s excep t equipmen t leak s mus t begi nb

yfour year s afte r promulgatio n(Novembe r 1996) . Dat a gathering fo r equipmen t leak s mus t begi nb yNovembe r 1994 .Ite m HO NMonitoring/Recordkeeping/Reportin g Cos t Analysi s (Frequenc yo f occurrenc e pe r ite mi s 1 tim e only. ) Hour s pe r ite m # o f respondent s Tota l Hrs . 80 0 12000 0 12080 0 Tota l Cos t ($ ) 25,60 0 3,840,00 0 3,865,60 0 Initia l Notificatio n Implement . Pla n -o r Permi t Appli . 30 0 40 0 40 0 Subtotal :

Fo r Complianc e Notificatio n Proces s Vent s Test s N o Test s Repor t Transfe r Test s N o Test s Storag e Subjec t t o Contro l No t Subjec t t o Contro l Equipmen t Leak s No . o f Emissio n Point s

36 0 8 0 8 0 1 2 36 0 2 0 (TRE<4 ) (TRE>4 ) 106 7

20 0 106 7 20 0 28 0 21 0

2 4 4 20 8 319 3 92 0 100 0 38412 0 1600 0 8536 0 240 0 10080 0 420 0

7663 2 368 0 20800 0 $12,291,84 0 512,00 0 2,731,52 0 76,80 0 3,225,60 0 134,40 0

2,452,22 4 117,76 0 6,656,00 0

Wastewate r Grou p 1 stream s 36 0 40 0 14400 0 4,608,00 0Grou p 2 stream s 10 0 120 8 12080 0 3,865,60 0 Est . tota l hour s required : 1,266,79 2 Tota l annualize d cost : $5,927,45 0

0 0Periodi c Report s

Ite m Gathe r Dat a # o f hour s Frequenc y pe r yea r # o f respondent s Tota l Hrs , Tota l Cos t (S J

Proces s Vent s Transfe r Storag e Wastewate r Equip . Leak s Repor t Dat a Al l point s Notice s o f Ne wSourc e Constructio n 30 0 28 2 2. 2 24 4 10 4

12 0 106 7 28 0 319 3 40 0 100 0

40 0 640,20 0

157,92 0 14,04 9 195,20 0 208,00 0

96,00 0 20,486,40 0 5,053,44 0 449,574 6,246,40 0 6,656,00 0

3,072,00 0

Notic e Const . / Reconst . Notic e expecte d Startu p Notic e o f Startu p Notic e of : -Tan k Inspect . -Grou p 2- 1 3 3 3 3 3 3 85 0 85 0 6 6 13 2 6 6 85 0 6,80 0 84 9 1,69 8 84 9 27,20 0 217,60 0

Annua l Cos t fo r Yea r 1 Annua l Cos t fo r Yea r 2 Annua l Cos t fo r Yea r 3 Annua l Cos t fo r Year s 4 an d 5 : $3,36 6 $7,180,83 8 $12,586,84 7 $48,139,46 2 Annua l Cos t fo r Year s 6 throug h15 : $48,136,06 5P.1 0

Attachment B Assumption s Behin

dth e BurdenEstimate s For Initia l Requirement s Th e numbe r o f respondent s fo r initia l notificatio nan d implementatio nplan s ar e base d o na reasonabl e upperbound estimat e o f th e numbe r o f facilitie s wit hunit(s ) subjec t t o th e rule . Th e estimat e o f hour s require d t o complet e animplementatio n pla ni s a nestimat e base d o nreporte d experienc e enumerating equipmen t i nfacilitie s simila r t o thos e subjec t t o HO Nan d determining i f a poin t i s likel yt o b e Grou p 1 o r 2 an

d th e planne d contro l approach . Proces s vent s subjec t t o testing b yMetho d 1 8 an

d othe r method s ar e thos e wit htota l resourc e effectivenes s (TRE ) les s tha n4 . (Vent s wit hTR E greate r tha n4 ar e no t require d t o performa tes t o f th e strea mcharacteristics . I t canb e a n engineering calculation) . Test s woul d hav e t o b e conducte d o n al l 106 7 proces s vent s t o determin e strea mcharacteristic s t o calculat e TRE . O f th e 106 7 abou t 43 0 woul d b e require d t o demonstrat e achieving 98 % emissio nreductio nan d establis ha monitorin g paramete r fo r th e contro l device . Estimat e o f time require d fo r proces s vent s tha t d o no t nee d testing wa s take nfro mestimate d tim e require d t o documen t a n engineering analysi s fo r a ven t wit hTR E > 4 . Thi s estimat e wa s base d o nexperienc e wit hdocumenting thes e analyse s an d i s consisten t wit hestimate s fro mNSP S burde nestimates . Transfe r testing estimate s wer e base d o ndocumentatio no f rac k weighte d averag e vapo r pressur e < 1. 5 psia . Estimat e fo r burde nassociate d wit hstorag e tank s subjec t t o contro l wa s base d o n time require d fo r initia l demonstratio no f IFRo r EF Rfo r a contro l devic e fo r a storag e tank . Fo r storag e tank s no t subjec t t o control , burde nestimate s wer e base d o nan estimat e o f th e time t o documen t liquid s store d i nth e tank an d t o documen t calculatio no f th e partia l pressur e o f liqui d HAP' s i nth e tank . Virtuall yal l proces s unit s i nth e SOCM I wil l b e subjec t t o th e equipmen t leak s contro l program(or LDA Rprogram) . Thi s estimat e i s th e time t o se t u p th e monitoring system an d run th e program . Thi s requiremen t applie s t o al l unit s b y1 8 month s afte r issuanc e o f th e fina l rule .P.1 1

Fo r Grou

p 1 wastewate r streams , th e estimat e o f time t o show complianc e reflect s requirement s fo r demonstratio no f performanc e o f treatmen t processe s a s wel l a s requirement s fo r eac htank , surfac e impoundment , etc. , an d assume s combining o f stream s likel yt o occur . Fo r Grou p 2 wastewate r streams , th e estimat e o f time t o showcomplianc e reflect s burde no f calculating an d documenting flowweighte d averag e annua l concentration . Fo r Periodi c Report s Estimate s fo r dat a gathering ar e derive d fro mdetaile d estimate s base d o nexperienc e wit hsimila r requirement s i nth e NSP S program . Time estimate s fo r initia l notificatio nar e take nfro m instruction s t o complet e previou s SF-8 3 burde nestimates . Thes e ar e commonl yuse d estimates . Also , thes e estimate s assume 10 0 proces s unit s affected , on e time only , an d spread equall yover thre e years , beginning i nth e third yea r afte r promulgation . Thu s one-thir d o f th e proces s unit s ar e assume d t o fil e a spo t report s th e firs t year , one-third th e nex t year , an d th e remaining thir d i nyea r three . Thes e report s ar e t o b e file d onl yfo r ne wequipmen t startups .P.1 2

BANKIN G Preambl e wil l explai n tha t Bankin g Provision s hav e bee n adde d t o th e HO Ni norde r to : • Provid e complianc e flexibilit ywhen :

Credi t an d debi t generator s hav e a mismatc hi n productio nrate s o r utilizatio n rates ; Routin e maintenanc e shutdown s fo r average d point s ar e i ndifferen t complianc e periods ; an d Credi t generator s mus t b e shutdow nwithou t notice . • Encourag e mor e emission s reduction s earlie r tha n required . • Reduc e complianc e costs . Bankin g policy : 1 ) Banke d credit s ca n b e generate d byan yemission s averag e tha t balance s o n a n annua l basis , an d ha s extr a credits . Additiona l point s ma yb e adde d t o a naverag e t o increas e th e likelihoo d o f creatin g bankabl e credits , bu t thes e additiona l point s ar e no t require d t o creat e bankabl e credits . Th e sourc e wil l repor t th e dat a use d t o calculat e thei r annau l balanc e an d anybankabl e credit s i n th e periodi c repor t use d t o certif ycomplianc e wit h th e emission s averagin g provisions . 2 ) Banke d credit s ca nb e use d fo r th e annua l balanc e o f credit s an d debits . Da.iked credit s canno t b e use d fo r th e quarterl y check s becaus e th e variabilit yfacto r (25% ) already allowe d fo r th e quarterl ycompariso nshoul d provid e sufficien t operationa l flexibilit yo na quarterl y basis . I n addition , th e quarterl ycheck s mus t b e base d o n actua l credit s an d debit s fro mth e precedin g quarte r becaus e thei r purpos e i s t o ensur e tha t level s o f over-contro l and under

contro l ar e roughl yequivalen t ove r eac hquarte r o f th e year . 3 ) Banke d credit s alon e canno t b e use d t o balanc e a n uncontrolle d Grou p 1 point . Th e averagin g pla n mus t includ e som e credi t fro mon-goin g over-contro l t o balanc e under-controlle d points . 4 ) Banke d credit s hav e a 2 t o 5-yea r life . EP Awil l propos e th e 2 t o 5-yea r rang e fo r comment .BANKIN G Exampl e o f Banke d Credi t Use : P.1 3

Credit s Debit s Newl y Banke d Banke d Withdraw n Yea r 1

7 0 7 0 0 0 0 Yea r 2

7 3 7 0 + 3

+ 3 0 ^•' ; Year..-3.:. .

8 0 7 0 +1 0 +1 3 0 Yea r 4

6 7 7 0 0 +1 0

- 3 Yea r 5

6 0 7 0 0 0 -1 0