### IPM Model

– Updates to Cost and Performance for APC Technologies

SDA FGD Cost Development Methodology

Final

March 2013

Project 12847

- 002

Systems Research and Applications Corporation

Prepared by

55 East Monroe Street • Chicago, IL 60603 USA • 312

- 269

- 2000LEGAL NOTICE

This analysis ( "

Deliverable " ) was prepared by Sargent & Lundy, L.L.C. ( " S&L " ), expressly for the sole use

of Systems Research and Applications Corporation ("Client") in accordance with the agreement between

S&L and Cl ient. This Deliverable was prepared using the degree of skill and care ordinarily exercised by

engineers practicing under similar circumstances. Client acknowledges: (1) S&L prepared this Deliverable

subject to the particular scope limitations, budgetary a nd time constraints, and business objectives of the

Client; (2) information and data provided by others may not have been independently verified by S&L; and

(3) the information and data contained in this Deliverable are time sensitive and changes in the da ta,

applicable codes, standards, and acceptable engineering practices may invalidate the findings of this

Deliverable. Any use or reliance upon this Deliverable by third parties shall be at their sole risk.

This work was funded by the U.S. Environmental Protection Agency and reviewed by William A. Stevens,

Senior Advisor

– Power Technologies

.IPM Model

– Updates to Cost and Performance for

APC Technologies Project No. 12847

- 002

March 2013



### SDA FGD Cost Development Methodology

Page 1 

### Establishment of Cost Basis

Cost data for the SDA FGD systems based on actual installations was more limited than

that for the wet FGD systems. A similar trend of capital cost with generating capacity (MW size) is generally seen between the wet and SDA system. The same least square

curve fit power relationship for capital costs as a function of generating capacity , up to 600 MW, was used for the wet and SDA cost estimation with the constant multiplier adjusted to ensure that the curve represented the data available

.

The curve fit was set to represent proprietary in

- house cost data of a " typical " SDA FGD

retrofit for removal of 9 5 % of the inlet sulfur

. It should be noted that the lowest available

SO 2 emission guarantees, from the original equipment manufactures of SDA FGD

systems, are 0.06 lb/MMBtu. The typical SDA FGD retrofit was based on:

Retrofit Difficulty = 1 ( Average retrofit difficulty) ;
Gross H eat Rate = 9 8 00 Btu/kWh ;
SO 2 Rate = 2 .0 lb/MMBtu ; Type of Coal = PRB ; Project Execution = Multiple lump sum contracts ; and

Recommended SO 2 emission floor = 0.08 lb/MMBtu.

Units below 50 MW will typically not install an SDA FGD system. Sulfur reductions for

the s mall units would be accomplished by; treating smaller units at a single site with one SDA FGD system, switching to a lower sulfur coal, repowering or conversion to natural

gas firing , dry sorbent injection, and/or a reduction in operating hours. Ca pital c osts of approximately $ 1,000 /kW may be used for units below 50 MW under the premise that

these will be combined.

Based on the typical SDA FGD performance, the technology should not be applied to

fuels with more than 3 lb SO 2 /MMBtu and the cost estimator s hould be limited to fuels

with less than 3 lb SO 2 /MMBtu.

An alternate dry technology, circulating dry scrubber (CDS), can meet removals of 98% or greater over a large range of inlet sulfur concentrations. It should be noted that the

lowest SO 2 emission g uarantees for a CDS FGD system are 0.04 lb/MMBtu. Recent industry experience has shown that a CDS FGD system has a similar installed cost to a comparable SDA FGD system.IPM Model

– Updates to Cost and Performance for

APC Technologies Project No. 12847

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March 2013



### SDA FGD Cost Development Methodology

Page 2 

### Methodology

Inputs

Several input variables are required in order to predict future r etrofit costs. The gross unit size in MW (equivalent acfm) and sulfur content of the fuel are the major variable s for the capital estimation. A retrofit factor that equates to difficulty in construction of the system must be defined. The costs herein c ould increase significantly for congested

sites. The unit gross heat rate will factor into the amount of flue gas generated and

ultimate ly the size of the absorber, reagent preparation, waste handling, and balance of plant costs. The SO 2 rate will have t he greatest influence on the reagent handling and waste handling facilities. The type of fuel (Bituminous, PRB, or Lignite) will influence the flue gas quantities as a r esult of the different typical heating values.

The cost methodology is based on a uni t located within 500 feet of sea level. The actual elevation of the site should be considered separately and factored into the cost due to the effects on the flue gas volume. The base absorber island and balance of plant costs are directly impacted by th e site elevation. These two base cost modules should be increased based on the ratio of the atmospheric pressure between sea level and the unit location. As an example, a unit located 1 mile above sea level would have an approximate atmospheric pressure of 12.2 psia. Therefore, the base absorber island and balance of plant costs should be increased by:

14.7 psia/12.2 psia = 1.2 multiplier to the base absorber island and balance of plant costs

Outputs

Total Project Costs (TPC)

First the installed costs are calculated for each required base module. The base module

installed costs include:

All equipment ;
Installation ; Buildings ;
Foundations ;
Electrical ; and

R etrofit d ifficulty

.

The base modules are:IPM Model

– Updates to Cost and Performance for

APC Technologies Project No. 12847

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March 2013



### SDA FGD Cost Development Methodology

Page 3 BMR = Base absorber island cost

BMF = Base reagent preparation and waste recycle/ handling cost

BMB = Base balance of plan t costs including: ID or boos ter fans, piping, ductwork and

reinforcement

, electrical, etc

...

BM = BMR + BMF + BMB

The total base module installed cost (BM) is then increased by:

En gineering and c onstruction management costs at 10% of the BM cost ; Labor adjustment for 6 x 10 ho ur shift premium, per diem, etc., at 10% of the

BM cost ; and Contractor profit and fees at 10% of the BM cost

.

A capital, engineering, and construction cost s ubtotal (CECC) is established as the sum of the BM and the additional engineering and construction fees.

Additional costs and financing expenditures for the project are computed based on the CECC. Financing and additional project costs include:

Owner ' s home office costs (owner ' s engineering, management, and procurement) at 5% of the CECC; and Allowance for Funds Used During Construction (AFUDC) at 10% of the

CECC and owner ' s costs. The AFUDC is based on a three

- year engineering and construction cycle.

The total project cost is based on a multiple lump sum contract approach. Should a turnkey engineering procurement construction (EPC) contract be executed, the total project cost c ould be 10 to 15% higher than what is currently estimated.

Escalation is n ot included in the estimate. The total project cost (TPC) is the sum of the CECC and the additional costs and financing expenditures.

Fixed O&M (FOM) The fixed operating and maintenance (O&M) cost is a function of the additional operations staff (FOMO) , maintenance labor and materials (FOMM), and administrative labor (FOMA) associated with the SDA FGD installation. The FOM is the sum of the FOMO, FOMM, and FOMA.IPM Model

– Updates to Cost and Performance for

APC Technologies Project No. 12847

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March 2013



### SDA FGD Cost Development Methodology

Page 4 The following factors and assumptions underlie calculations of the FOM:

All of the FOM co sts were tabulated on a per kilowatt

- year (kW yr) basis.

In general, 8 additional operators are required for a SDA FGD system

. The FOMO was based on the number of additional operations staff required.

The fixed maintenance materials and labor (includes bag replacement) is a direct function of the process capital cost at 1.5% of the BM

.

The administrative labor is a function of the FOMO and FOMM at 3% of (FOMO + 0.4FOMM)

.

Variable O&M (VOM)
Variable O&M is a function of:

Reagent use and unit costs ;
Was te production and unit disposal costs ; Additional power required and unit power cost ; and Makeup water required and unit water cost

.

The following factors and assumptions underlie calculations of the VOM:

All of the VOM costs were tabulated on a per mega watt

- hour (MWh) basis.

The reagent usage is a function of gross unit size, SO 2 feed rate, and removal efficiency. While the capital costs are based on a 95% sulfur removal design, the operating sulfur removal percentage can be adjusted to reflect actual variable operating costs.

In addition to sulfur removal efficiency, the estimated reagent usage was

based on a flue gas temperature into the SDA FGD of 300°F and an adiabatic

a pproach to saturation of 30°F.

The calcium

- to

- sulfur stoichiometric ratio vari es based on inlet sulfur. The

variation in stoichiometric ratio was accounted for in the estimation. The economic estimation is only valid up to 3 lb SO 2 /MMBtu inlet.

The basis for the lime purity was 90% CaO with the balance being inert

material.IPM Model

– Updates to Cost and Performance for

APC Technologies Project No. 12847

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March 2013



### SDA FGD Cost Development Methodology

Page 5 The waste generation rate is a function of inlet sulfur and calcium to sulfur stoichiometry. Both variables are accounted for in the waste generation estimation. The waste disposal rate is based on 10% moisture in the by

product.

The additional power requi red includes increased fan power to account for the

added SDA FGD pressure drop. Th is requirement is a function of gross unit size (actual gas flow rate) and sulfur rate.

The additional power is reported as a percent of the total unit gross production. In addition, a cost associated with the additional power requirements can be included in the total variable costs.

The makeup water rate is a function of gross unit size (actual gas flow rate)

and sulfur feed rate.

Input options are provided for the user to adjust the variable O&M costs per unit. Average default values are included in the base estimate. The variable O&M costs per unit options are:

Lime cost in $/ton ; Waste disposal costs in $/ton ; Auxiliary power cost in $/kWh ; Makeup water costs in $/ 1000 gallon ; and Operating labor rate (including all benefits) in $/hr

.

The variables that contribute to the overall VOM are:

VOMR = Variable O&M costs for lime reagent

VOMW = Variable O&M costs for waste disposal

VOMP = Variable O&M costs for addition al auxiliary power

VOMM = Variable O&M costs for makeup water

The total VOM is the sum of VOMR

, VOMW

, VOMP , and VOMM

. Table 1 shows a complete capital and O&M cost estimate worksheet for an SDA FGD

.IP M Model

– Updates to Cost and Performance for APC Technologies Project No. 12847

- 002

March 2013



### SDA FGD Cost Development Methodology

Page 6 Table 1 . Example Complete Cost Estimate for an SDA F GD SystemIP M Model

– Updates to Cost and Performance for APC Technologies Project No. 12847

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March 2013



### SDA FGD Cost Development Methodology

Page 7