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OAR Box 1781 

Prepped by Ollie Stewart 

Document Number: 

20)11-1-12 

Docket Number: 

A-90-37 

Printed 10/29/2008 10:46:19 AM Sheet 20 of 142 
Agenda #38 South Coast 

AIR QUALITY MANAGEMENT DISTRICT 4~&'s? 

9150 FLAIR DRIVE. EL MONTE, CA 917.30-= 9V737U- (8.18(8,18)J57 ) 72-620 2 0 jf~^ " ^ ~ 

ctobe r 27, 1987 

South Coast Air Quali 

Management District 

Report on the Amendment of the District's 

Best Available Control Technology fBACT) Guidelines 

Due to the severe air pollution problems in the South Coast 

Air Basin, the District periodically updates its policies to 

ensure that the most stringent requirements are implemented. 

The implementation of Best Available Control Technology 

(BACT) is one of the areas where changes are needed to 

reflect the more stringent state laws and District's rules. 

The New Source Review regulation, Regulation XIII, specifies 

that any construction of a new facility or modification of 

an existing facility which results in increased emissions 

•O. into the atmosphere must be constructed using BACT. Under 

Rule 13 02, BACT is defined as the most stringent emission 

limit or emission control technology which either has been: 

1. Achieved in practice for such permit unit 

category or class of source, or 

2. Contained in any state implementation plan, or 

3. Found to be technologically feasible and costeffective. 

For large businesses, if the best control technology meets 

either of the first two criteria above for the specific 

class of source, it is required regardless of cost. A 

candidate control technology not meeting the first two 

criteria is still required if found to be technologically 

feasible and cost effective. 

In the case of applications from small businesses, Rule 13 03 

requires that economic impact be considered in all BACT 

determinations. 

Regulation XIII also requires the District to periodically 

publish a guideline of BACT for commonly processed permit 

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unit categories or class of sources. The District initially 

/ published the BACT guidelines in May, 1983. Those 
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South Coast Air Quality -2- October 27, 1987 '' 4fc 

Management District Board t 

guidelines included two economic screening criteria which 

are capital cost and the cost effectiveness of the control 

technology. Capital cost criterion ensured that control 

costs were not excessive when compared to the basic 

equipment. The cost effectiveness criterion ensured that 

the control cost per ton of air pollutants reduced did not 

exceed the maximum control costs of the short-range 

strategies identified in the 1982 Air Quality Management 

Plan (AQMP). The economic screening process allowed the 

District to make a case-by-case review and tailor the 

control requirements to the specific permit unit and 

contaminant. 

To be consistent with the rules as passed by the Board, 

staff has now suspended the use of the economic screening 

process for all equipment with the exception of equipment 

owned by small businesses as specified in Rules 1303 and 

1302(aa) or for new control technologies that we are 

requiring pursuant to Rule 1302(e)(3). The capital cost 

criterion is no longer considered in the economic screening 

process for new control technologies required pursuant to 

Rule 1302(e)(3). The cost effectiveness criterion, 

expressed in dollars per ton of air pollutants controlled, 

now only applies to small businesses and new control 

technologies not meeting the first two BACT definitions. 

The maximum cost per ton of air pollutants controlled has 

been revised to reflect the most expensive control 

strategies adopted by the Board. The maximum cost per ton 

previously used in the May 1983 BACT guidelines represented 

the short-range strategies of the 1982 AQMP. The revised 

maximum cost per ton will apply to all permit applications 

submitted to the District after December 1, 1987. 

The table below shows the maximum values to be used in 

determining the cost effectiveness of the proposed control 

technique. These values are to be compared to the actual 

control cost which is determined by dividing the sum of 

annualized capital and operating costs of the control 

equipment by the tons of pollutants reduced per year. Thus:. 

a candidate control device will be required when the third 

BACT definition is applicable or when a small business is 

the applicant if the actual control cost does not exceed 

these maximum values. 

n 
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South Coast Air Quality 

Management District Board 

-3- October 27, 1987 

CONTAMINANT 

Organics 

NOX 

TSP 

SOX 

MAXIMUM 

SOURCE 

1982 AQMP 

Tactic D3 

1982 AQMP 

Tactic El 

1982 AQMP 

Tactic D7 

1982 AQMP 

Tactic Al 

COST* 

(5/TON,) 

17,500 

24,500 

5,300 

18,300 

PREVIOUS 

SOURCE 

1982 AQMP 

Tactic D5 

1982 AQMP 

Tactic A8 

1982 AQMP 

Tactic D7 

1982 AQMP 

Tactic A13 

COST** 

(S/TON) 

5,000 

9,700 

5,700 

3,900 

r 

* Adjusted to August, 1987, using CPI, All Urban Consumers, 

United States 

** Adjusted to December, 1986, using CPI, All Urban 

Consumers, United States 

Staff feels that the more stringent BACT guidelines are 

essential to our effort to increase the effectiveness of the 

new source review program and in attaining the ambient air 

quality standards. 

Additionally, the District has contracted with Jacobs 

Engineering Group, Inc. to'study the effectiveness of the 

BACT program. Staff is currently reviewing the preliminary 

results of this study. Upon the completion of the review 

process, staff will report the results of the study to the 

Board. At that time, staff may make additional changes to 

the BACT program based on the information presented in the 

study. 

THEREFORE, IT IS RECOMMENDED THAT YOUR BOARD 

- - Receive and file this report. 

Respectfully, 

\r. Lents, Ph.C 

'Execut ? v BIJOI f i <SM r 

EC:WJD:CM:caz 
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A STUDY TO EVALUATE THE EFFECTIVENESS OF 

THE SCAQMD'S BEST AVAILABLE CONTROL 

TECHNOLOGY (BACT) PROGRAM 

Prepared for: 

South Coast Air Quality Management District 

Engineering Division 

9150 Flair Drive 

Q Monte, CA 91731 

by 

Jacobs Engineering Group Inc. 

HTM Division 

251 S. Lake Avenue 

Pasadena, CA 91101 

Jacobs Project No. 27-A281-00 

November 1987 

Major Contributors 

Scott Hedges, Project Manager 

Michael Callahan, Chemical Engineer David Butler, Economist 

Thuy Le, Chemical Engineer Pierre Sycip, Computer Specialist 
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A STUDY TO EVALUATE THE EFFECTIVENESS OF 

THE SCAQMD'S BEST AVAILABLE CONTROL TECHNOLOGY 

(BACT) PROGRAM 

TABLE OF CONTENTS 

Section 

EXECUTIVE SUMMARY 1 

1.0 INTRODUCTION/OBJECTIVES 9 

2.0 ASSESSMENT OF SCAQMD'S CURRENT BACT ECONOMIC 

SCREENING CRITERIA (TASK 1) 10 

2.1 DATA BASE DEVELOPMENT 11 

2.2 CRITIQUE OF CURRENT BACT PROGRAM BASED ON 

REVIEW OF THE SCAQMD PERMIT APPLICATION FILES 51 

2.3 DEVELOPMENT OF CONTROL COST VERSUS EMISSION 

REDUCTION CURVES FOR VARIOUS LEVELS OF CONTROL 66 

2.4 DEVELOPMENT OF NEW BACT ECONOMIC SCREENING 

CRITERIA 86 

:

 2.5 RECOMMENDATIONS AND CONCLUSIONS 108 

2.6 REFERENCES 110 

3.0 SPECIFYING BASIC EQUIPMENT AS BACT 114 

3.1 NATURAL GAS AND DIESEL FIRED INTERNAL 

COMBUSTION ENGINES 117 

3.2 ELECTRIC HEATERS AND MOTORS 126 

3.3 BOILERS 131 

3.4 PAINTS AND COATINGS 136 

3.5 OIL AND GAS PROCESSING 139 

3.6 REFINERY OPERATIONS 140 

3.7 FUGITIVE EMISSIONS 144 

3.8 MATERIAL HANDLING 149 

APPENDICES A-D 
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EXECUTIVE SUMM.ARY 

In February 1987, the South Coast Air Quality Management District (SCAQMD) Board 

awarded a Business Consulting Agreement to Jacobs Engineering Group Inc. (Jacobs) to 

prepare a study evaluating the effectiveness of the current SCAQMD (Best Available 

Control Technology) BACT program. 

Three tasks were assigned to meet project objectives: (Task 1) assess the District's 

economic criteria for BACT; (Task 2) identify new control technologies to be proposed 

as BACT, along with cost data and emission reductions that could be realized; and 

(Task 3) evaluate the feasibility of specifying certain basic equipment as BACT in 

terms of emissions and economic impact. Tasks 1 and 3 are outlined in this report. 

Task 2 will be supplied at a later date as an addendum to this report. 

BACT ECONOMIC CRITERIA ASSESSMENT (TASK 1) 

Recommendations 

As a result of the BACT economic criteria assessment phase of the study, the 

following recommendations are provided for the new BACT economic screening 

program: 

1) Eliminate the control cost versus the basic equipment cost portion of the 

current BACT economic screening criterion (Criterion 3b). This is 

suggested since this criterion represents the primary reason for economic 

criterion failure for most control measures. It is also suggested in order to 

eliminate the discrepancy of purchasing used or low cost basic equipment 

and subsequently reducing the maximum allowable control cost. 

2) New cost-effectiveness criteria are recommended to be set at or above 

$6,000/ton for NOx , $50,000/ton for ROG, $5,000/ton for particulate and 

$20,000/ton for CO. These criteria are recommended to be consistent with 

District attainment goals. By incorporating these new economic criteria, 

the majority of the control measures assessed in the report will pass the 

economic test of BACT. 
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3) Develop a standardized procedure for the determination of emission reductions 

and associated installation and operating control costs. This procedure would be 

followed during the BACT evaluation phase of permit application processing. By 

so doing, data inconsistencies will be minimized and the overall efficiency of the 

permit evaluation process will be improved. 

4) Adopt the post tax cost annualization model of Jacobs. This cost model accounts 

for tax savings to firms as a result of control equipment depreciation. This 

model will effectively lower the overall cost per ton values calculated for a 

control system. 

5) Adopt a BACT retrofit program. The BACT economic analysis indicates that 

ROG and NOx attainment goals could potentially be met through the 

implementation of this type of program. This statement is valid provided that it 

is technically feasible to employ the vast majority of the potential BACT control 

measures. Even if the BACT retrofit program falls short of the attainment goal 

of the District, very significant additional emission reductions would still result. 

6) Utilize the computerized data base and economic analysis spreadsheets 

developed by Jacobs Engineering as a working tool for future planning and 

permitting endeavors of the SCAQMD. These computerized data may be 

expanded to incorporate additional control measures and equipment categories 

and may be a valuable resource for future air quality and emission reduction 

programs and strategies. 

Economic Assessment Methodology 

To conduct the Task 1 portion of the study, Jacobs developed an emission reduction 

and control cost data base (Appendices A and B) from the District's permit application 

files and control measures specified by the District and/or listed in the SCAQMD's 

BACT Handbook dated May 1983 and analyzed the control costs and emission 

reductions from the data base to develop new economic screening criteria and to 

project emission reductions from implementation of new criteria. The data base was 

developed from a random sampling of over 900 applications granted permits to 

construct since July 1983 for twelve basic equipment categories. From this 

representative sample data base, emission reductions and associated emission control 
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costs were determined for the currently required control measures and subsequently 

standardized for potential levels of controls reflected in the SCAQMD BACT 

Handbook. 

The potential or hypothetical control costs were annualized according to a post tax 

cost annualization (economic) model, similar to what the SCAQMD uses now with the 

addition of tax savings to a firm due to control equipment depreciation. Separate 

annualized control costs and cost-effectiveness ratios were developed for new 

equipment and existing equipment where appreciable cost differences existed. 

The resultant cost-effectiveness values were assigned to every applicable data base 

entry (individual applications). Appendix B (the hypothetical level of control data 

base) provides a complete listing of these cost effectiveness values and associated 

installation and operating control costs applied to both new and existing (potential 

retrofit) equipment. 

The relationships between these control costs per ton and associated emission 

reductions were graphically presented (Appendix C) and further evaluated to 

determine potential new cost-effectiveness criteria for a new or revised BACT 

economic screening program. To assist in this determination, Jacobs reviewed the 

representative sample of permit applications to determine what types of control 

measures failed current economic screening criteria and why the measures failed. 

Once the control cost and cost-effectiveness data base were finalized, a computerized 

BACT economic analysis was performed with results provided in Appendix D. The 

primary focus of the BACT economic analysis was to project basinwide emission 

reductions that may be achieved for every potential cost-effectiveness criterion 

applied to newly permitted equipment and to the potential retrofit population. 

Basinwide emission reductions using the present BACT criteria and other applicable 

rules and regulations were also estimated for the new equipment population and the 

retrofit population. 

Resulta and Conclusions 

The following results/conclusions were drawn as a result of the Task 1 BACT economic 

analysis: 
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1) The current BACT Economic Screening Criterion 3b which provided for a 

maximum allowable control equipment cost as a function of the basic equipment 

cost (Screening Criterion 3b) constituted the primary reason that potential BACT 

control measures failed current economic screening criteria. As a result, this 

criterion allows permit applicants to minimize their required level of control by 

purchasing used or low cost basic equipment. 

2) The permit application files provided detailed control cost data and costeffectiveness analyses only for select isolated cases. Typically, only a 

qualitative BACT compliance statement was provided. In addition, it was 

difficult to determine what specific equipment components were included in the 

provided control cost data. 

3) The pre-tax cost annuaiization (economic) model used by the District to 

calculate the cost-effectiveness of potential BACT control measures does not 

include the tax deductibility of operating cost and capital depreciation. This tax 

deductibility was incorporated into the Jacobs post tax cost annuaiization model. 

4) The NOx and ROG attainment goals of the District (as specified in the 1982 Air 

_ Quality Management Plan and recent Reasonable Further Progress Reports) 

1 could potentially be met through the implementation of a BACT retrofit 

program. This assumes that it will be technically feasible to install most of the 

j BACT control measures analyzed in this study on the projected retrofit 

population'. 

5) Incorporating cost-effective values of $6,000/ton for NOx , $50,000/ton for ROG, 

$20,000/ton for CO, and $5,000/ton for particulate into the District's BACT 

program would economically allow the implementation of the vast majority of 

the BACT control measures listed in the SCAQMD BACT Handbook (dated May 

1983) for the twelve equipment categories studied. 

6) Approximately 31,000 and 1,500 additional tons per year of NOx and ROG 

emission reductions are projected to result over the next five years (1988 

through 1992) from the application of these new BACT cost-effectiveness 

criteria to the projected new equipment population. 
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7) Approximately 190,000 and 106,000 tons per year of NOx and ROG emission 

reductions are projected to result from the application of these new BACT costeffectiveness criteria to the projected potential retrofit population. In addition, 

approximately 136,000 and 103,000 tons per year of NOx and ROG reductions are 

projected to result from the application of the present BACT criteria and other 

applicable rules and regulations to the projected potential retrofit population. 

These emission reductions predicted for the potential retrofit population would 

meet the air quality attainment goals of the District provided most of the 

evaluated control measures pass the technical applicability test of BACT. 

Lastly, it is important to note that the suggested cost-effectiveness criteria may 

be altered as a result of the incorporation of additional control measures into the 

analysis. The primary objective of the BACT economic analysis was to provide 

appropriate cost-effectiveness relationships for the overall emission reduction 

objectives of the SCAQMD. 

SPECIFYING BASIC EQUIPMENT AS BACT (TASK 3) 

The primary objective of Task 3 was to investigate the feasibility of specifying a 

select set of equipment and/or control measures as basic equipment. The SCAQMD 

has recently taken this approach with regards to SCR on boilers larger than 50 

MMBtu/hr. Instead of the criteria normally used (technical feasibility, cost 

effectiveness, and basic equipment cost), only technical feasibility and ccst 

effectiveness are employed. To accomplish the objective of this task, Jacobs 

evaluated the technical feasibility, emission reductions, and economic impacts (cost 

effectiveness) of each basic equipment item shown in Table ES-1. 

As shown in Table ES-1, 50 percent of the measures investigated can be called BACT. 

A "yes" answer indicates that the measure is technically feasible and that the 

estimated or expected cost effectiveness value is within range of the District's current 

screening level. For situations where only a few applications passed or were expected 

to pass the District's screening criteria, a "yes" answer was still applied. Passage of 

BACT only means that the measure should be placed on the District's list of approved 

control measures and a screening evaluation be performed on a case-by-case basis. A 

"no" answer indicates that the measure was found to be technically infeasible, limited 

to an extremely narrow range of application, or exceeded cost effectiveness criteria 

by several orders of magnitude. 
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For those measures listed under BACT as "no", it follows that they cannot be specified 

as basic equipment. For those items listed as "yes", it then becomes a question of 

range of application and cost effectiveness. A "yes" answer under basic equipment 

indicates that the range of applicability is so large and that the cost effectiveness 

value is so low that very few applications are expected to foil. This means that a 

measure listed as basic equipment can be required without the need of performing a 

case-by-case screening. The use of the term "limited" means that the measures can be 

called basic equipment but only for a limited range of application. 
TADLE ES-1 SPECIFYING BASIC EQUIPMENT AS BAC T 

Meuaure 

Ketrofi t of a rich-burn gas 

engine to Prestratlfie d charge 

Ketrofi t of a rich-burn gos 

engine l o Stratifie d churge 

Two-stage lean burn 

•Use of gas turbinea in place 

of gas engines 

Use of electri c ovens 

Use of electri c ovens 

Use of electri c heaters 

Use u l electri c motor s 

Use ul electri c motors 

Retrofi t of a gas-fired 

boiler wit h FGti 

Uuu of wutc r tuliu veruuu 

fire tube gus-fired boilers 

Range Pollutant Reduction Cott Effectiveness 

300 t o 1000 HP 

500 to 1000 HP 

1000 to 3000 HP 

293 KW 

N O , 

N O , 

N O . 

N O , 

smaller than 70 KW NO . 

N O , 

15 to 25 M M Btu/hr NO,, 

large diesel engines NO,, 

25 to 400 M M Dtu/hr NO„ 

90% 

00% 

100% 

100% 

100% 

100% 

smull cliesul engines NO x 100% 

40% 

10 lo 50 MM lim/hr NOx increuae 

$112 to $55 

$450t o $12 

90% $1,493 to $1,159 

$201,400 

$7,000 

No 

UACjJ-° ) Basic Egfo ) Comment ! 

Yes Limite d Limite d t o four-stroke engines. 

Yes Yes Also applies t o new installations. 

No 

Yes 

No 

No 

No 

$5,750 lo $710 Yes 

No 

No 

Limite d 

No 

No 

No 

Yes Limite d 

Yes Limite d 

Yes 

No 

Not available in the South Coast. 

For installations larger than 800 HP . Additiona l 

reductions can be achieved by use of wate r 

injection . 

Smal l electri c ovens are commonl y used but they 

do nol satisfy cost effectiveness criteria . 

Dased on NO x . 

Electri c heaters are commonl y used on offshore 

plat forms located close to shore. As wit h 

electri c ovens, the co u effectivenes s values 

are expected to be prohibitive . 

Electricificulio n of offshore facilitie s may not 

be practical . Effectiveness depends on availabilit y of utilities . 

Based on NO x . Analysis wus for u smal l crune 

locuted on an offshore platfor m wit h cogeneration 

turbines . 

Also applies to new installations und oil-fire d 

boilers . 

Fire tube gus-fired design emits 10% less NO x , 

costs less, and is slightly more efficient . 

TJ 
TADLE ES-1 SPECIFYING BASIC EQUIPMENT AS BACT (continued) 

• :. 

Measure 

Use of nulural-gas-fired 

versus diosel-fired boilers 

Use of high-solid comings 

Use of chemical emulsion 

breakers in place of wash 

(Rink healers 

Use of FHO before FCC unit 

Use of UCT before FCC unit 

Use of sealless pumps 

Use of bellow-sealed gate 

vulvea 

Use ul welded pipe 

Use ol pneumatic systems 

Range 

All 

All 

50,000 BPD 

50,000 BPD 

Pollutant Reduction Cost Effectiveness BACT^B^ Pasic Egfo) 

N O x 20 to 60% Positive return Yes Yes 

Comments 

All 

VOC 

SOx 

SO* 

Heavy to light liquids VOC 

Light liquids to gas VOC 

VOC 

Purl . 

67% 

Unknown 

70% 

70% 

$5 

$12,100 

$1,220 

Yes 

No 

No 

No 

Limited 

No 

No 

No 

100% 

100% 

100% 

100% 

$ll,050t o $2,020 

$0,570to $3,460 

— 

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Yes 

Yes 

No 

No 

Limited 

Limited 

No 

No 

Reduction depends on style of unit. Positive 

return due to lower fuel cost. 

Use of this control would depend on market 

demand or applicability of high-solid coalings. 

No technical information uvuilable to support 

this option. 

Commonly used due to its flexibility and effect 

on product quality. Proven process used tu 

meet current SCAQM D emission limits. 

Process not proven, restrictive operating 

conditions. Use may increase NO x emissions. 

Limited lo pumps handling light liquids. 

Limited to gate valves handling gases. 

Facility could incur very high maintenance costs. 

Capital costs are lower than conventional systems, 

energy requirements ore greater. 

(a) A "yes" indicates that the method is technically feusible, applicable, and satisfies the District's current screening criteria for some applications. All applications must be 

unulyzed on a case by case baais. 

(b) A "yes" indicutea Ihut BACT criteria ia oxpoctud to be sulislied for most applicolions so that case by case screening is nol warrunted. "Limited" indicutes thul all BACT 

crilurlu will bu uutisfii:tl but only for n limilud rungu of uppllcut ion. Additional study is requirud to determine the extent of that range.