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# OAR Box 1828 Prepped by Ollie Stewart



### Document

Number: 

# 310 ) IV-B-1 4
Docket Number: 

# A-83-2 7

Printed 11/12/200811:12:59 AM Sheet 310 of 325P. 2 

# f RADIA N 

# A-83-2 7

CORPORATIO N IV-B-1 4

MEMORANDUM

DATE : Apri l 15 , 198 7 TO : Fre dPorte r an dWal t Stevenson , EPA/SD B FROM : Edwar dAu l an dButc hStackhouse , Radia nCorporatio n SUBJECT : Impac t o f Ne w Fue l Price s o nth e Cost s an dCos t Effectivenes s o f SOpEmissio nContro l o f Industria l Coal - an dOil-Fire d Mode l Steam

Generatin g Unit s
1. 0 SUMMARY

InAugus t 1986 , fue l price projection s fo r coal , oil , an dnatura l ga s supplie dt o industria l market s wer e revised . Thi s memo examine s th e impact s o f th e revise dpric e projection s o nth e incrementa l cos t effectivenes s (CE ) o f S0 2 contro l fo r typica l mode l stea m generatin g unit s (i.e. , boilers) . Wit hregar dt o coal-fire dboilers , th e revise dpric e projection s hav e littl e impact . Tabl e 1 show s tha t th e C E o f S0 2 contro l unde r th e new fue l pric e projection s i s simila r inmagnitud e t o th e C E o f S0 2 contro l unde r th e previou s projections . Th e incrementa l C E o f S0 2 contro l associate dwit ha standar dbase do nusin g low sulfu r coa l ove r th e regulator y baselin e i s $350/M g ($320/ton ) o r les s unde r 198 6 price projections ; inth e prio r analysi s thi s valu e wa s nea r $460/M g ($420/ton ) o r below . Th e incrementa l C E o f SO - contro l associate dwit ha standar drequirin g a percen t reductio n inS0 2 emission s ove r a standar dbase donusin g low sulfu r coa l range s fro m $89 0 t o $1,720/M g ($81 0 t o $l,560/ton ) unde r new price projections ; inth e prio r analyse s thi s rang e wa s $77 0 t o $2,050/M g ($70 0 t o $l,860/ton) . In addition , th e cos t effectivenes s o f S0 2 contro l associate dwit hthes e regulator y

alternative s fo r coal-fire dboiler s operatin g a t lowe r capacit y utilizatio nfactor s ar e als o o f th e same orde r o f magnitud e unde r bot hth e new an dth e previou s pric e projections . Th e impact s o f th e revise dfue l price projection s onth e incrementa l C E o f S0 2 contro l fo r typica l oil-fire dboiler s ar e summarize dinTabl e 2 . I n contras t t o coal-fire dboilers , th e revise dprojection s hav e a significan t

Progres s Center/320 0 E

. Chape l Hil l Rd./Nelso n Hwy./P.O

. Bo x13000/Researc h Triangl e Park

. N.C

. 27709/(919)541-9100^

r o TABL E 1 . IMPAC T O F REVISE DCOAL PRIC E PROJECTION S O N TH E INCREMENTAL COS T EFFECTIVENES S O F REGULATOR YALTERNATIVES 3

Incrementa l Cos t Effectiveness , $/to n 198 4 Coa l 198 6 Coa l Pric e Projection s Pric e Projection s Alternative s Compare dRegio nV Regio nVII I Regio nV Regio nVII I
2 9 an d4 4 M W (10 0 an

d15 0 millio nBtu/hr ) Stea m Generatin g Unit s Lo w sulfu r coa l ove r baselin e 41 0 210-22 0 31 0 4 0 Percen t reductio nove r lo w sulfu r coa l 1,320-1,73 0 1,620-1,86 0 1,280-1,56 0 1,150-1,36 0

7 3 an d1 7 M W (25 0 an

d40 0 millio nBtu/hr ) Stea m Generatin g Unit s Lo w sulfu r coa l ove r baselin e 42 0 23 0 32 0 50-6 0 Percen t reductio nove r lo w sulfu r coa l 700-94 0 1,230-1,37 0 880-1,04 0 810-93 0

a Capac1t y

utilizatio nfacto r = 0.60 . b T o conver t fro

m $/to nt o $/Mg , multipl y b y 1.102 .TABL E 2 . IMPAC T O F REVISE DOI L PRIC E PROJECTION S O N TH E INCREMENTAL COS T EFFECTIVENES S O F REGULATORYALTERNATIVES 3

48 0 64 0 3,380-6,63 0 40 0 550-57 0 6,420-9,69 0 Incrementa l Cos t Effectiveness , $/to n 198 6 01 1 Pric e Projection s 198 4 01 1 Pric e High01 1 Pric e Lo w 01 1 Pric e Alternative s Compare dProjection s Scenari o Scenari o
2 9 an d4 4 M W (10 0 an

d15 0 minio nBtu/hr ) Stea m Generatin g Unit s Lo w sulfu r oi l ove r baselin e 62 0 Ver y lo w sulfu r oi l ove r lo w sulfu r oi l 310-680 Percen t reductio nove r very lo w sulfu r oi l 0 C

7 3 an d1 7 M W (25 0 an

d40 0 millio nBtu/hr ) Stea m Generatin g Unit s Lo w sulfu r oi l ove r baselin e 450-49 0 Ver y lo w sulfu r oi l ove r lo w sulfu r oi l 0 Percen t reductio nove r very lo w sulfu r oi l 0

3 Capac1t y

utilizatio nfacto r = 0.55 . T o conver t fro

m $/to nt o $/Mg , multipl y b y 1.102 . incrementa l cos t effectivenes s 1 s $0/to nsince , fo r thes e cases , th e least-cos t optio nt o mee t bot ha very

lo w sulfu r oi l standar dan da percen t reductio nstandar d1 s t o us e a nFGD system an dfir e hig

hsulfu r oil . 48 0 340-56 0 0 C 41 0

550-56 0 1,340-3,04 0P. 5

impac t onth e cost s an dC E o f a percen t reductio nstandar dfo r oil-fire d boiler s relativ e t o a ver y lo w sulfu r oi l standard . Unde r th e previou s pric e projections , th e least-cos t optio nt o mee t a very low sulfu r oi l emissio nlimi t o f 12 9 n g S0 2 / J(0. 3 l bS0 2 /millio nBtu ) wa s t o us e a nFG D system an dfir e highsulfu r oil . Wit hrevise dpric e projections , however , th e least-cos t optio nt o mee t thi s same limi t i s t o fir e a ver y low sulfu r oi l inal l case s excep t fo r boiler s a t o r abov e 7 3 M W (25 0 millio nBtu/hr ) unde r th e highoi l pric e scenario . Thi s chang e ha s a significan t impac t on th e incrementa l C E o f a percen t reductio nstandar dove r a ver y lo w sulfu r oi l standard . Sinc e FG Dwa s use dt o mee t th e ver y low sulfu r oi l standar d inth e previou s analysis , th e incrementa l C E o f an y additiona l emissio n reductio nassociate dwit ha standar drequirin g a percen t reductio nin emission s wa s essentiall y $0/Mg o r ton . Thi s situatio ni s ver y differen t unde r th e new fue l pric e projections . Now a standar drequirin g a percen t reductio ni nemission s impose s additiona l cost s ove r thos e fo r a ver y lo w sulfu r oi l standard . Sinc e th e decreas e in emission s associate dwit hth e percen t reductio nstandar di s ver y small , th e incrementa l C E o f thi s standar dove r a ver y lo w sulfu r oi l standar di s muc h highe r an

drange s fro

m $1,48 0 t o $10,680/Mg ($1,34 0 t o $9,690/ton ) unde r low oi l prices . Unde r highoi l prices , th e incrementa l C E i s inthi s same rang e fo r boiler s below

7 3 M W (25 0 millio nBtu/hr ) bu t i s $0/Mg o r to nfo r large r boiler s since , a s wit hpreviou s pric e projections , boile r owner s choos e t o us e a nFG Dsystem

an dfir e highsulfu r oi l inrespons e t o bot ha percen t reductio nstandar dan da ver y

low sulfu r oi l standard . Fo r othe r regulator y

alternatives , th e incrementa l C E o f S0 2 contro l fro m oil-fire dboiler s unde r th e new fue l pric e projection s i s simila r in magnitud e t o th e C E o f S0 2 contro l unde r th e previou s projections . Th e incrementa l C E o f a standar dbase donusin g lo w sulfu r oi l ove r th e regulator y

baselin e range s fro m $ 44 0 t o $530/Mg ($40 0 t o $480/ton ) unde r new pric e projections ; inth e prio r analysi s th e C E range dfro m $50 0 t o $680/M g ($45 0 t o $620/ton) . Th e incrementa l C E o f a ver y low sulfu r oi l standar dove r a low

sulfu r oi l standar dnow range s fro

m $38 0 t o $710/M gP. 6

($34 0 t o $640/ton) ; inth e previou s analysi s thi s valu e range dfro m $ 0 t o $680/Mg ($ 0 t o $620/ton) . Fo r oil-fire dboiler s operatin g a t lowe r capacit y utilizatio nfactors , th e C E o f S0 2 contro l associate dwit hstandard s base donusin g low sulfu r oi l an dver y low sulfu r oi l ar e o f th e same orde r o f magnitud e unde r bot h th e new an drevise dfue l pric e projections . Th e incrementa l C E o f a percen t reductio nstandar dove r a ver y low sulfu r fue l standar dis , however , significantl y

highe r unde r th e new fue l pric e projections . Thi s i s du e bot h t o th e effec t o f capacit y utilizatio nfacto r o nFGDsystem

economic s an

dth e lowe r fue l sulfu r premium s whic hcharacteriz e th e new projections .
2. 0 INTRODUCTION

InAugus t 1986 , fue l pric e projection s fo r coal , oil , an dnatura l ga s 1- 3 supplie dt o industria l market s wer e revised . Thi s memo assesse s th e impact s o f thes e ne w

fue l price s onth e previou s analyse s o f th e cos t andCE o f reducin g S0 2 emission s fro m coal - an

doil-fire dboilers . Th e previou s analyse s wer e pres.ente dinth e report s Industria l Boile r SO ? Cos t Repor t an d Summar y o f Regulator y

Analvsis . ' Comparison s o f previou s an dcurren t fue l pric e projection s fo r coal , oil , an dnatura l ga s ar e presente dinTable s 3 an d4 . A s shown , th e genera l trendha s bee na declin e infue l price s betwee nth e 198 4 an d198 6 projection s an

da reductio ninth e fue l sulfu r premiu m (i.e. , th e additiona l pric e o f low

sulfu r fuel s relativ e t o highsulfu r fuels) . Inaddition , bot h low andhig hoi l pric e scenario s hav e bee ndevelope dfo r th e 198 6 pric e projection s an

dar e reflecte dinTabl e 4 . Fo r calculatio no f flu e ga s desulfurizatio n(FGD ) malfunctio ncosts , non-carriage/rigi dnatura l ga s price s wer e used , a s describe dinReferenc e 3 . Non-carriag e price s ar e representativ e o f natura l ga s delivere dona "non-interruptible " contrac t basis , a s woul db e require dinthi s situation . A rigi dnatura l ga s regulator y

environmen t wa s assume dsinc e thi s represent s th e current status-quo . Inadditio nt o thes e fue l pric e changes , mino r modification s wer e mad e t o th e methodolog y

fo r calculatin g capita l an dnon-fue l operatin g andTABL E 3 . COMPARISO N O F 198 4 AN

D 198 6 COAL AN

D NATURAL GA S PRIC E PROJECTION S

Fue l Typ e Nomina l Coa l Sulfu rConten t ( l b S0 2 /m1ll1o n Btu ) Jul y198 4 Pric e Projection 3 (198 3 $/m1ll1o n Btu ) Augus t 198 6 Pric e Projection 1 5 (198 5 $/m1ll1o n Btu ) Regio n V B-bitum1nou s coa l E-bitum1nou s coa l H-b1tum1nou s coa l Natura l ga s 1. 2 2. 5 6. 0 3.3 2 3.0 8 2.5 0 5.8 8 2.7 5 2.5 7 2.2 4 3.77 c
Regio n VII I E-subb1tum1nou s coa l B-subb1tum1nou s coa l Natura l ga s 2. 5 1. 2 1.2 8 1.4 0 4.9 1 1.3 5 1.3 7 3.14 c

Source : Referenc e 4

. ) Source : Reference s 1-3

. 'Base d o n a non-carr1age/r1gi d natura l ga s marke t an d lo woi l prices , a s discusse d 1 n Referenc e 3 ,TABL E 4 . COMPARISO N O F 198 4 AN

D 198 6 OI L PRIC E PROJECTION S

Fue l Typ e Augus t 198 6 Pric e Projectio n Jul y1984 (198 5 $/m1ll1o n Btu) b Pric e Projection 3 (198 3 $/m1ll1o n Btu ) Hig h Oi l Price s Lo wOi l Price s 0. 3 l b S0 2 /m1ll1o n Bt u residua l oi l 5.9 7 4.8 4 3.4 9

0. 8 l bS0 2 /m1ll1o nBt uresidua l oi l 5.6 3 4.6 8 3.3 5
3. 0 l b S0 2 /mill1o n Bt u residua l oi l 4.8 1 4.1 5 2.9 0
Natura l ga s 5.8 8 4.82 1 3.77 '
Source : Referenc e 4

. Source : Reference s 1-3

. 'Base d o n a non-carr1age/rig1 d natura l ga s market , a s discusse d 1 n Referenc e 3

. Pric e projection s ar e fo r Regio nV .P. 9

maintenanc e cost s fo r mode l boilers . These modification s ar e discusse din ful l inAppendi xA . Thes e modification s hav e hada negligibl e effect , however , o

nthi s assessmen t o f new fue l pric e impacts .
3. 0 IMPACT S FORCOAL-FIRE DMODE L STEA M GENERATINGUNIT S
3. 1 Previou s Impact s fo r Coal-Fire dUnit s
Cos t an dC E value s fo r typica l coal-fire dmode l boiler s operatin g in Region s V

an dVIII , base donth e previou s (i.e. , Jul y 1984 ) pric e projections , ar e presente dinTable s 5 an d6 . Th e cos t estimate s inTabl e 5 correspon dt o fou r differen t boile r sizes , al l operatin g a t a capacit y utilizatio nfacto r o f 0.60 . Tabl e 6 i s base do na 4 4 M W (15 0 millio n Btu/hr ) boile r operatin g a t capacit y utilizatio nfactor s o f 0.15 , 0.30 , an d 0.60 . Fo r ne w

coal-fire dboiler s th e cos t estimate s inTabl e 5 show tha t th e incrementa l C E o f SO - contro l associate dwit ha standar dbase donusin g low sulfu r coa l [i.e. , coa l wit hpotentia l averag e S0 2 emission s o f 41 3 n g S0 2 / J (0.9 6 l bS0 2 /millio nBtu) ] ove r th e regulator y baselin e o f mediu

m sulfu r coa l [i.e. , 90 3 ng/ J(2.1 0 lb/millio nBtu) ] range dfro m $23 0 t o $460/M g ($21 0 t o $420/ton ) fo r Region s V an dVIII . I

nRegio nV , th e leas t cos t optio nfo r meetin g a percen t reductio nrequiremen t wa s t o us e a highsulfu r coa l [i.e. , 2,38 2 ng/ J(5.5 4 lb/millio nBtu)] . Th e incrementa l C E o f S0 2 contro l associate dwit ha standar drequirin g a percen t reductio nin emission s ove r a standar dbase donlo w sulfu r coa l range dfro m $77 0 t o $1,900/M g ($70 0 t o $l,730/ton) . InRegio nVIII , highsulfu r coal s ar e no t generall y available ; th e highes t sulfu r coa l generall y availabl e i s a mediu m sulfu r coal . Thi s coa l wa s als o th e least-cos t optio nfo r meetin g a percen t reductio nrequirement . Th e incrementa l C E o f a percen t reductio nrequiremen t applie dt o medium sulfu r coa l ove r th e us e o f lo w sulfu r coa l alon e range dfro m $1,35 0 t o $2,050/M g ($1,23 0 t o $l,860/ton) .TABL E 5 . COS TIMPACT

S FOR COAL-FIRE D STEA M GENERATIN G UNIT S I N REGION S V AN D VII I (Jul y 198 4 Pric e Projections ; Januar y 198 3 $ ) a, b

REGIO N V REGIO N VII I

Regulator y Alternativ e , Incrementa l Coa l Type , Annua l Annualize d Cos t n g SO./ J Emissions , Cost , Effectiveness , (l b SO_/minio n Btu ) Mg/y r(tons/yr ) ($1000/yr ) J/M g ($/ton ) Coa l Type . Annua l Annualize d n g S0-/ J Emissions , Cost , •. •.cu . .co o ( l b S0 2 /m1l1lo n Btu ) Mg/y r(tons/yr ) (SlOOO/yr ) j/M g ($/ton ) Incrementa l Cos t Effectiveness
.

v o 2 9 M

W(10 0 millio n Btu/hr) : Baselin e . Lo wSulfu rFuel " Percen t Reduction 6 90 3 41 3 2.38 2 (2.10 ) (0.96 ) (5.54 ) 4 4 M W (15 0 millio n Btu/hr) : Baselin e 90 3 (2.10 ) Lo wSulfu rFue l 41 3 (0.96 ) Percen t Reductio n 2,38 2 (5.54 ) 7 3 M W (25 0 millio n Btu/hr) : Baselin e 90 3 Lo wSulfu rFue l 41 3 Percen t Reductio n 2,38 2 (5.54 ) (2.10 ) (0.96 )

11 7 M W (40 0 millio n Btu/hr) : Baselin e Lo wSulfu rFue l Percen t Reductio n 90 3 41 3 (2.10 ) (0.96 ) 2,38 2 (5.54 ) 50 0 (550 ) 23 0 (250 ) 10 0 (110 )

75 0 (830 ) 34 0 (380 ) 15 0 (170 )

1.25 0 (1.380 ) 57 0 (630 ) 25 0 (280 )

2,01 0 (2.210 ) 92 0 (1.010 ) 40 0 (440 ) 4,43 0

4,56 0 4.80 0

6.16 0 6.34 0 6.62 0

10.43 0 10.75 0 11,08 0

15,20 0 15.70 0 16,10 0 45 0

1.90 0

45 0 1,45 0

46 0 1,03 0

46 0 77 0 (410 ) (1.730 )

(410 ) (1,320 )

(420 ) (940 )

(420 ) (700 ) 90 3 (2.10 )

41 3 (0.96 ) 90 3 (2.10 )

90 3 (2.10 ) 41 3 (0.96 ) 90 3 (2.10 )

90 3 (2.10 ) 41 3 (0.96 ) 90 3 (2.10 )

90 3 (2.10 ) 41 3 (0.96 ) 90 3 (2.10 ) 50 0 23 0 4 0

75 0 34 0 5 0

1,25 0 57 0 9 0 (550 ) (250 ) (40 )

(830 ) (380 ) (60 )

(1,380 ) (630 ) (100 ) 3,64 0

3,71 0 4,09 0

4,95 0 5.05 0 5.56 0

8,20 0 8,37 0 9,09 0 24 0

2,05 0

23 0 1,78 0

25 0 1.51 0 - (220 ) (1,860 )

(210 ) (1,620 )

(230 ) (1,370 )

2,01 0 (2,210 ) 11.56 0 92 0 (1,010 ) 11,84 0 15 0 (170 ) 12,86 0 25 0 (230 ) 1,35 0 (1,230 )

Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounde d t o neares t tenth . b Capac1t y utilizatio n facto r= 0.60 . Correspond s t o 1,07 5 ng/ J (2. 5 lb/mi l lio n Btu ) S0 2 emissio n limit
. Correspond s t o 51 6 ng/ J (1. 2 lb/millio n Btu ) S0 2 emissio n limit
. Correspond s t o 9 0 percen t SO - reductio n requirement
. f Least-cos t optio n t o mee t regulator y alternative
.TABL E 6 . COS TIMPACT

S FOR A 4 4 M

W (15 0 MILLIO N BTU/HOUR ) COAL-FIRE D STEA M GENERATIN G UNI TI N REGION S V AND VII I A S A FUNCTIO N O F CAPACIT YUTILIZATIO N FACTORS4 (Jul y 198 4 Pric e Projections ; Januar y 198 3 J )

Coa l Type, 8 Regulator y n g S0-/ J Alternativ e (l b S0 2 /m1111o n Btu )
0. 6 Capacit y Utilizatio n Factor : Basel1ne b 90 3 (2.10 ) Lo wSulfu rFuel c 41 3 (0.96 ) Percen t Reduction " 2,38 2 (5.54 ) 0. 3 Capacit y Utilizatio n Factor : Baselin e 90 3 (2.10 ) Lo wSulfu rFue l 41 3 (0.96 ) Percen t Reductio n 2,38 2 (5.54 ) 0.1 5 Capacit y Utilizatio n Factor : Baselin e 90 3 (2.10 ) Lo wSulfu rFue l 41 3 (0.96 ) Percen t Reductio n 2,38 2 (5.54 ) REGIO N V

Ann i Emls s a l ons , Mg/y r(tons/yr )

75 0 34 0 15 0

38 0 17 0 7 0

19 0 8 0 4 0 (830 ) (380 ) (170 )

(410 ) (190 ) (80 )

(210 ) (90 ) (40 ) Annualize d

Cost , ($1000/yr )

6,16 0 6.34 0 6.62 0

4,52 0 4.62 0 4.90 0

3,87 0 3,92 0 4,20 0 Incrementa l

Cos t Effectiveness , $/M g (J/ton )

- 45 0 (410 ) 1,48 0 (1.340 )

- 45 0 (410 ) 3.04 0 (2,760 )

- 45 0 (410 ) 6.14 0 (5,570 ) Coa l Type, 6 n g S0-/ J (l b S0 2 /ro1l1lo n Btu )

90 3 41 3 90 3

90 3 41 3 90 3

90 3 41 3 90 3 (2.10 ) (0.96 ) (2.10 )

(2.10 ) (0.96 ) (2.10 )

(2.10 ) (0.96 ) (2.10 ) REGIO N VII I

Ann i Emlss l a l ons . Mg/y r(tons/yr )

75 0 34 0 5 0

38 0 17 0 3 0

19 0 8 0 2 0 (830 ) (380 ) (60 )

(410 ) (190 ) (30 )

(210 ) (90 ) (20 ) AnnualIze d

Cost , (JlOOO/yr )

4,95 0 5.05 0 5.56 0

4.03 0 4.07 0 4,45 0

3.72 0 3,75 0 4.06 0 Incrementa l

Cos t Effectiveness , J/M g (J/ton )

_ 23 0 (210 ) 1,78 0 (1,620 )

_ 23 0 (210 ) 2.66 0 (2.410 )

_ 23 0 (210 ) 4,45 0 (4,030 )

a Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounded t o neares t tenth . Correspond s t o 1,07 5 ng/ J (2. 5 lb/m1ll1o n Btu ) S O emissio n limit
. Correspond s t o 51 6 ng/ J (1. 2 lb/m11l1o n Btu ) S0 2 emissio n limit
. Correspond s t o 9 0 percen t S0

_reductio n requirement
. Ceast-cos t optio n t o mee t regulator y alternative
.P.1 2

A s show ninTabl e 6 fo r a new 4 4 M W (15 0 millio nBtu/hr ) coal-fire d boiler , th e incrementa l C E o f using lo w sulfu r coa l ove r th e regulator y baselin e wa s abou t $450/Mg ($410/ton ) inRegio nV an d$230/Mg ($210/ton ) in Regio nVII I an

di s no t a functio no f capacit y utilizatio nfactor . Th e reaso ni s tha t fue l cost s an dS0 2 emission s chang e inth e sam e proportio n tha t capacit y

utilizatio nfacto r changes ; therefor e no difference s in incrementa l C E value s result . Onth e othe r hand , Tabl e 6 show s tha t th e cos t impact s associate dwit h a percen t reductio nrequiremen t relativ e t o th e us e o f lo w sulfu r coa l increas e significantl y a s capacit y

utilizatio nfacto r decreases . Thi s i s becaus e th e larg e capita l cost s associate dwit hFGDsystem s installe dt o compl y wit ha percen t reductio nrequiremen t mus t be born e b y a smalle r numbe r o f operatin g hours . A s shown , th e incrementa l C E o f a percen t reductio nrequiremen t applie dt o highsulfu r coa l inRegio nV ove r th e us e o f low sulfu r coa l wa s $3,040/M g ($2,760/ton ) a t 0. 3 capacit y facto r an

d $6,140/M g ($5,570/ton ) a t 0.1 5 capacit y factor . Th e same requiremen t applie dt o medium

sulfu r coa l inRegio nVII I resulte dinincrementa l C E value s fo r a percen t reductio nstandar dove r th e us e o f low sulfu r coa l o f $2,660/M g ($2,410/ton ) a t 0. 3 capacit y facto r an

d$4,450/M g ($4,030/ton ) a t 0.1 5 capacit y

factor .
3. 2 Revise dImpact s fo r Coal-Fire dUnit s
Th e cos t an

dC E value s fo r new

coal-fire dboiler s base donth e revise d (i.e. , Augus t 1986 ) fue l pric e projection s ar e presente dinTable s 7 an d8 . On e importan t chang e tha t result s wit hth e us e o f th e ne w fue l pric e projection s i s tha t i t i s les s expensiv e t o appl y a percen t reductio n requiremen t t o medium o r low sulfu r coal s tha nt o a hig hsulfu r coal . Th e reaso ni s tha t th e lowe r sulfu r coal s requir e les s FG Dreagen t t o achiev e th e same S0 2 reductio nleve l an dhenc e incu r lowe r cost s fo r reagent , wast e disposal , an

dinteres t onworkin g capital . Thes e lowe r cost s mor e tha n compensat e fo r th e highe r fue l price s associate dwit hthes e coals ; th e ne t effec t i s lowe r annualize dcost s fo r scrubbin g lowe r sulfu r coal s relativ e



### 1 1TABL E 7 . COS TIMPACT

S FOR COAL-FIRE D STEA M GENERATIN G UNIT S I N REGION S V AND VIII a , b (Augus t 198 6 Pric e Projections ; Jun e 198 5 J )

REGION V REGION VII I

Regulator y Alternativ e Incrementa l Coa l Type , Annua l Annualize dCos t ng SO_/ JEmissions , Cost , Effectiveness , (lbS0 2 /minio nBtu ) Hg/y r (tons/yr ) (JlOOO/yr ) J/H g (J/ton ) Incrementa l

Coa l Type , Annua l Annualize dCos t ng SO-/ JEmissions , Cost , Effectiveness , (lbS0 2 /m11T1o nBtu ) Mg/yr (tons/yr ) (JlOOO/yr ) J/M g (J/ton )
2 9 M W (10 0 millio nBtu/hr) : Basel1ne c 90 3 (2.10 ) Lo w Sulfu r Fuel d41 3 (0.96 ) Percen t Reduction 6 90 3 (2.10 ) 4 4 M W (15 0 millio nBtu/hr) : Baselin e 90 3 (2.10 ) Lo w Sulfu r Fue l 41 3 (0.96 ) Percen t Reductio n90 3 (2.10 ) 7 3 M W (25 0 millio nBtu/hr) : Baselin e Lo w Sulfu r Fue l Percen t Reductio n 11 7 M W (40 0 millio nBtu/hr) : 90 3 (2.10 ) 41 3 (0.96 ) 90 3 (2.10 )

Baselin e 90 3 (2.10 ) Lo w Sulfu r Fue l 41 3 (0.96 ) Percen t Reductio n90 3 (2.10 ) 50 0 23 0 4 0

75 0 34 0 5 0
1,25 0 57 0 9 0
2,01 0 92 0 15 0 (550 ) (250 ) (40 )

(830 ) (380 ) (60 )
(1,380 ) (630 ) (100 )
(2,210 ) (1,010 ) (160 ) 4,26 0

4,35 0 4.66 0
5,87 0 6.01 0 6.42 0

9.96 0 10.20 0 10,75 0

14.39 0 14,77 0 15,52 0 34 0 (310 )

1.72 0 (1,560 )

34 0 (310 ) 1.41 0 (1.280 )

35 0 (320 ) 1,14 0 (1,040 )

35 0 (320 ) 97 0 (880 ) 90 3 (2.10 ) 41 3 (0.96 ) 41 3 (0.96 )

90 3 (2.10 ) 41 3 (0.96 ) 41 3 (0.96 )

90 3 (2.10 ) 41 3 (0.96 ) 41 3 (0.96 )

90 3 (2.10 ) 41 3 (0.96 ) 41 3 (0.96 ) 50 0

23 0 2 0

75 0 34 0 2 0

1.25 0 57 0 4 0
2,01 0 92 0 7 0 (550 ) (250 ) (20 )
(830 ) (380 ) (30 )
(1,380 ) (630 ) (50 )
(2,210 ) (1.010 ) (70 ) 3,77 0

3,79 0 4,10 0
5,14 0 5,15 0 5,56 0

8.50 0 8,54 0 9,09 0
12,00 0 12.06 0 12,82 0 -

4 0 (40 ) 1,50 0 (1,360 )

5 0 (40 ) 1.26 0 (1,150 )

6 0 (60 ) 1,03 0 (930 )

6 0 (50 ) 89 0 (810 )

a Annua l emissions , annualize dcosts , an dcos t effectivenes s value s roundedt o neares t tenth . Capacit y

utilizatio nfacto r - 0.60 . Correspond s t o 1,07 5 ng/ J (2. 5 lb/millionBtu ) S0 2 emissio nlimit . Correspond s t o 51 6 ng/ J (1. 2 lb/millionBtu ) S0 2 emissio nlimit . Correspond s t o 9 0 percen t SO - reductionrequirement . Least-cos t optio nt o mee t regulatory alternative .O O TABL E 8 . COS TIMPACT

S FO R A 4 4 M

W(15 0 MILLIO N BTU/HOUR ) COAL-FIRE D STEA M GENERATIN G UNI TI N REGION S V AND VII I A S A FUNCTIO N O F CAPACIT YUTILIZATIO N FACTORS8 (Augus t 198 6 Pric e Projections ; Jun e 198 5 J )

Coa l Type, 8 Regulator y n g SO_/ J Alternativ e (l b SO^rollTIo n Btu )
0. 6 Capacit y Utilizatio n Factor : Basel1ne b 90 3 Lo wSulfu rFuel c 41 3 Percen t Reductio n 90 3 0. 3 Capacit y Utilizatio n Factor : Baselin e 90 3 Lo wSulfu rFue l 41 3 Percen t Reductio n 90 3 0.1 5 Capacit y Utilizatio n Facto r Baselin e 90 3 Lo wSulfu rFue l 41 3 Percen t Reductio n 90 3 (2.10 ) (0.96 ) (2.10 )

(2.10 ) (0.96 ) (2.10 )

(2.10 ) (0.96 ) (2.10 ) REGIO N V

Annua l Emissions , Mg/y r(tons/yr )

75 0 34 0 5 0

38 0 17 0 3 0

19 0 9 0 1 0 (830 ) (380 ) (60 )

(410 ) (190 ) (30 )

(210 ) (100 ) (20 ) Annualize d

Cost
. (JlOOO/yr )

5,87 0 6,01 0 6,42 0

4,43 0 4,50 0 4,85 0

3.87 0 3,91 0 4,23 0 Incrementa l

Cos t Effectiveness , J/M g (J/ton )

34 0 (310 ) 1.41 0 (1,280 )

34 0 (310 ) 2,47 0 (2,240 )

34 0 (310 ) 4,52 0 (4,100 ) Coa l n g (l b S0 2 / m

90 3 41 3 41 3

90 3 41 3 41 3

90 3 41 3 41 3 Type , 50-/ J llllo n Btu )

(2.10 ) (0.96 ) (0.96 )

(2.10 ) (0.96 ) (0.96 )

(2.10 ) (0.96 ) (0.96 ) REGIO N VII I

Annua l Emissions , Mg/y r(tons/yr )

75 0 34 0 2 0

38 0 17 0 1 0

19 0 9 0 1 0 (830 ) (380 ) (30 )

(410 ) (190 ) (10 )

(210 ) (100 ) (10 ) Annualize d

Cost
. (JlOOO/yr )

5,14 0 5,15 0 5,56 0

* 4,16 0 4,17 0 4.53 0

3,85 0 3,85 0 4.16 0 Incrementa l

Cos t Effectiveness , J/M g (J/ton )

5 0 (40 ) 1,26 0 (1,150 )

4 0 (40 ) 2,21 0 (2,010 )

4 0 (40 ) 3,86 0 (3,500 )

a Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounde d t o neares t tenth . Correspond s t o 1,07 5 ng/ J (2. 5 lb/millio n Btu ) S0

_emissio n limit
. Correspond s t o 51 6 ng/ J (1. 2 lb/millio n Btu ) S0 2 emissio n limit
. Correspond s t o 9 0 percen t S0

_ reductio n requirement
.
e Least-cos t optio n t o mee t regulator y alternative
.P.1 5

t o highsulfu r coals . Fo r th e previou s fue l pric e projections , th e fue l pric e difference s betwee nlowe r sulfu r an dhighsulfu r coal s outweighe dth e reagen t an

dothe r cos t saving s s o a s t o mak e scrubbin g o f highsulfu r coal s th e least-cos t scrubbin g alternative . Th e cos t estimate s inTabl e 7 sho w tha t th e incrementa l C E o f usin g lo w sulfu r coa l ina new

coal-fire dboile r operatin g a t a capacit y utilizatio n facto r o f 0.6 0 ove r th e regulator y baselin e range s fro m abou t $4 0 t o $350/Mg ($4 0 t o $320/ton ) fo r Region s V an dVIII . I

nRegio nV , th e incrementa l C E o f a percen t reductio nrequiremen t applie dt o mediu m sulfu r coal , whic hi s th e lowes t annualize dcos t optio nfo r thi s alternative , ove r th e us e o f lo w sulfu r coa l range s fro m abou t $97 0 t o $1,720/Mg ($88 0 t o $l,560/ton) . I n Regio nVIII , th e annualize dcost s fo r percen t reductio nar e lowes t whe n applie dt o lo

w sulfu r coal . Th e incrementa l C E o f thi s alternativ e ove r th e us e o f low

sulfu r coa l rang e fro m abou t $89 0 t o $1,500/M g ($81 0 t o $l,360/ton) . A compariso no f cost s fo r coal-fire dboiler s operatin g a t lowe r capacit y utilizatio nfactor s i s presente dinTabl e 8 . Th e tabl e show s that , a s wit hth e previou s fue l pric e projections , th e incrementa l C E o f th e us e o f low sulfu r coa l ove r th e regulator y baselin e [a t $4 0 t o $340/Mg ($4 0 t o $310/ton) ] i s no t a functio no f capacit y utilizatio nfactor , fo r th e same reason s discusse dinSectio n3.1 . Onth e othe r hand , th e incrementa l C E value s o f th e least-cos t option s fo r percen t reductio nrelativ e t o th e us e o f low sulfu r coa l increas e significantl y a s capacit y

utilizatio nfacto r decreases , als o du e t o th e same factor s discusse dinSectio n3.1 . A s shown , th e incrementa l C E o f a percen t reductio nrequiremen t applie dt o mediu m sulfu r coa l i nRegio nV ove r th e us e o f lo

w sulfu r coa l i s approximatel y $2,470/M g ($2,240/ton ) a t 0. 3 capacit y facto r an

d$4,520/M g ($4,100/ton ) a t 0.1 5 capacit y

factor . Th e same requiremen t applie dt o low sulfu r coa l in Regio nVII I result s i nincrementa l C E value s ove r th e us e o f low sulfu r coa l o f $2,210/M g ($2,010/ton ) a t 0. 3 capacit y facto r an

d$3,860/M g ($3,500/ton ) a t 0.1 5 capacit y

factor .



### 1

43. 3 Comparisono f Impact s fo r Coal-Fire dUnit s

Th e incrementa l C E value s associate dwit hth e 198 6 fue l pric e projection s ar e simila r inmagnitud e t o th e correspondin g value s base don th e 198 4 projections , bu t slightl y lower . I t shoul dbe note dthat , eve nin th e absenc e o f fue l pric e changes , updatin g th e time basi s o f th e non-fue l cost s fro

m Januar y

198 3 dollar s t o Jun e 198 5 dollar s act s t o increas e incrementa l costs , an dhenc e C E values , b y a facto r o f 1.03 . Thu s th e fac t tha t th e analogou s incrementa l C E value s hav e decline dslightl y betwee nth e 198 3 an d198 5 basi s estimate s indicate s tha t th e chang e infue l pric e projection s ha s hada smal l bu t noticeabl e impac t onth e C E o f compare d alternatives . Inaddition , fo r bot hset s o f fue l pric e projection s th e incrementa l C E value s ar e no t a stron g functio no f boile r size , althoug hC E value s fo r percen t reductio noption s generall y declin e a s boile r siz e increase s du e t o FG Deconomie s o f scale . Fo r boiler s wit hlowe r capacit y utilizatio nfactors , th e same trend s appl y fo r bot hset s o f fue l pric e projections . Again , th e incrementa l C E value s ar e o f th e same orde r o f magnitud e bu t slightl y lowe r fo r th e 198 6 fue l pric e projections . I t i s importan t t o note , however , tha t th e previou s nationa l impact s analysi s showe dtha t little , i f any , coa l woul db e fire din new fossi l fuel-fire dboiler s operatin g a t lo w capacit y

utilizatio nfactor s eve nassumin g a highcoa l penetration . A t capacit y factor s o f 0.3 0 an

d below , oi l o r natura l ga s wer e th e fuel s o f choic e eve ninth e absenc e o f a standard . Sinc e natura l ga s price s hav e decline dt o a greate r exten t betwee nth e 198 4 an

d198 6 projection s tha nhav e coa l prices , natura l ga s combustio nwil l b e eve nmor e attractiv e o na nafter-ta xne t presen t valu e basi s tha nwa s th e cas e fo r th e 198 4 projections . Thu s a t capacit y utilizatio nfactor s o f 0. 3 o r less , oi l an dnatura l ga s wil l continu e t o represen t th e "economi c fuel s o f choice " eve ninth e absenc e o f a standard .



### 1 54. 0 IMPACT S FOROIL-FIRE DMODE L STEA M GENERATINGUNIT S
4. 1 Previou s Impact s fo r Oil-Fire dUnit s
Cos t an dcos t effectivenes s value s fo r oil-fire dmode l boiler s operatin g inRegio nV , base donth e previou s fue l pric e projections , ar e presente dinTable s 9 an d10 . Onl y

on e se t o f oi l pric e value s wer e use d fo r thes e tables , correspondin g t o th e lo w oi l pric e scenario . Th e result s o f th e prio r cos t analysi s showe dtha t fo r al l boile r size s operatin g a t a typica l capacit y

utilizatio nfacto r o f 0.55 , i t wa s les s costl y t o fir e a highsulfu r oi l an

dinstal l a

nFG Dsystem

t o mee t a

nemission s limi t o f 12 9 ng S0 2 / J(0. 3 l bS0 2 /millio nBtu ) hea t inpu t tha nt o fir e a ver y low sulfu r oil . Also , fo r boiler s a t o r abov e 7 3 M W (25 0 millio nBtu/hr ) hea t inpu t capacity , i t wa s les s costl y t o fir e a highsulfu r oi l an dinstal l a

nFG D system t o mee t a

nemissio nlimi t o f 34 4 n g S0 2 / J(0. 8 l bS0 2 /millio nBtu ) hea t inpu t tha nt o fir e a lo w sulfu r oil . At lowe r capacit y utilizatio n factors , however , i t wa s les s costl y t o fir e very

lo w sulfu r oi l o r low sulfu r oi l t o mee t thes e respectiv e S0 2 emissio nlimits . Fo r ne w oil-fire dboilers , th e cos t estimate s inTabl e 9 show tha t th e incrementa l C E o f S0 2 contro l associate dwit ha standar dbase donusin g lo w sulfu r oi l ove r th e regulator y baselin e o f mediu

m sulfu r oi l range dfro m $49 0 t o $680/M g ($45 0 t o $620/ton) . Becaus e boiler s o f 7 3 M W (25 0 millio n Btu/hr ) an

dabov e choos e t o us e a nFG Dsystem

an dfir e hig hsulfu r oi l t o compl y wit ha standar dbase donlow sulfu r oil , th e incrementa l C E o f S0 2 contro l associate dwit ha standar dbase donver y lo w sulfu r oi l ove r a standar dbase do nlow sulfu r oi l range dfro m $ 0 t o $750/M g ($ 0 t o $680/ton) . Moreover , th e incrementa l C E o f S0 2 contro l associate dwit ha standar d requirin g a percen t reductio ni nemission s ove r a standar dbase do nver y low sulfu r oi l wa s effectivel y $0/Mg o r ton . Tabl e 1 0 show s that , fo r a ne w 4 4 M W (15 0 millio nBtu/hr ) oil-fire d boiler , th e incrementa l C E o f usin g lo w sulfu r oi l ove r th e regulator y baselin e wa s $680/M g ($620/ton ) an di s no t a functio no f capacit y utilizatio nfactor . Fo r a ver y lo w sulfu r oi l standard , th e least-cos t optio nchange dfro

m usin g a

nFG Dsystem

an dfirin g hig hsulfu r oi l a t 0.5 5



### 1 6TABL E 9 . COS TIMPACT

S FOR OIL-FIRE D STEA M GENERATIN G UNIT S I N REGIO N V a , b (Jul y 198 4 Pric e Projections ; Januar y 198 3 J )

Regulator y Alternativ e Oi l Type, 9 n g SO_/

J (l b SO_/mTil1o n Btu ) Annua l Emission s Mg/y r(tons/yr ) Annualize d Cost , (JlOOO/yr ) Incrementa l Cos t Effectiveness , J/M g (J/ton )
2 9 M W(10 0 millio n Btu/hr ) Baselin

e Lo w Sulfu r Fue l Ver y Lo w Sulfu r Fuel £ Percen t Reductio

n 4 4 M W (15 0 millio

nBtu/hr ) Baselin

e Lo w Sulfu r Fuel Ver y Lo w Sulfu r Fue l Percen t Reductio

n 7 3 M W (25 0 millio

nBtu/hr ) Baselin

e Lo w Sulfu r Fue l Ver y Lo w Sulfu r Fuel Percen t Reductio

n 11 7 M W (40 0 millio n Btu/hr ) Baselin e Lo wSulfu rFue l Ver y Lo

wSulfu rFue l Percen t Reductio n 3. 0 0.8 . 3.0 h 3. 0

3. 0 0.8 . 3.0 h 3. 0

3. 0 3 -° h 3.0 h 3. 0

3. 0 3.0 h 3. 0 66 0 18 0 5 0 5 0

98 0 26 0 8 0 8 0

1.64 0 13 0 13 0 13 0

2.62 0 20 0 20 0 20 0 (720 ) (190 ) (60 ) (60 )

(1,080 ) (290 ) (80 ) (80 )

(1,810 ) (140 ) (140 ) (140 )

(2.890 ) (220 ) (220 ) (220 ) 3,27 0 3,60 0 3.71 0 3,71 0

4,66 0 5,15 0 5,22 0 5.22 0

7.41 0 8.23 0 8.23 0 8,23 0

11,97 0 13.16 0 13.16 0 13.16 0 68 0 (620 ) 75 0 (680 ) 0 (0) J

68 0 (620 ) 34 0 (310 ) 0 (0> J ti

54 0 (490 ) 0 (o r 0 (0) J

49 0 (450 ) 0 (0) * 0 (0)* 5

a Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounde d t o th e neares t tenth . Capacit y utilizatio n facto r« •0.55 . Correspond s t o 1,29 0 ng/ J (3. 0 lb/m1ll1o n Btu ) S0 2 emissio n limi t dCorrespond s t o 34 4 ng/ J (0. 8 lb/m1ll1o n Btu ) S0 2 emissio n limit
. Correspond s t o 12 9 ng/ J (0. 3 lb/m1ll1o n Btu ) SO

_emissio n Umit
. Correspond s t o 9 0 percen t SO

_reductio n requirement
. 9 Least-cos t optio n t o mee t regulator y alternative
. Ces s expensiv e t o fir e 3. 0 l b S O /millio n Bt u oi l an d Instal l a n FG D syste m tha n t o fir e 0. 3 l b S0 2 /m1111o n Bt u oil
. 1 Les s expensiv e t o fir e 3. 0 l b S O /millio n Bt u oi l an d Instal l a n FG D syste m tha n t o fir e 0. 8 l b S0 2 /m1111o n Bt u oil
. -'Incrementa l cos t effectivenes s I s JO/M g o r to n since , fo r thes e cases , th e least-cos t optio n t o mee t bot h a ver y lo wsulfu roi l standar d an d a percen t reductio n standar d I s t o us e a n FG D syste m an d fir e hig h sulfu roil
. k Incrementa l cos t effectivenes s I s JO/M g o r to n since , fo r thes e cases , th e least-cos t optio n t o mee t a lo wsulfu r o i l standar d an d a ver y lo wsulfu roi l standar d I s t o us e a n FGD syste m an d fir e hig h sulfu roil
.TABL E 10 . COS

TIMPACT

S FO R A 4 4 M

W(15 0 MILLIO N BTU/HOUR ) OIL-FIRE D STEA

M GENERATING UNI TI N REGIO N V A S A FUNCTIO N O

F CAPACIT

YUTILIZATIO N FACTORS 3 (Jul y 198 4 Pric e Projections ; Januar y 198 3 J )

C O Regulator y Alternativ e 01 1 Type. ' n g SO./ J (IbSGymllllo nBtu ) Annua l Emission s Mg/y r (tons/yr ) Annualize dCost , ($1000/yr )
0.5 5 Capacit y

Utilizatio nFactor : Baselin e Lo w Sulfu r Fuel c Very Lo w Sulfu r Fue l Percen t Reduction 8 0.3 0 Capacit y

Utilizatio nFactor : BaselIn e Lo wSulfu rFue l Ver y Lo wSulfu rFue l Percen t Reductio n 0.1 5 Capacit y

Utilizatio nFactor : Baselin e Lo wSulfu rFue l Ver y Lo wSulfu rFue l Percen t Reductio n 3. 0 0. 8 3.0 9 3. 0

3. 0 0. 8 0. 3 3. 0

3. 0 0. 8 0. 3 3. 0 98 0 (1,080 ) 26 0 (290 ) 8 0 (80 ) 6 0 (80 )

54 0 (590 ) 140 (160 ) 5 0 (60 ) 4 0 (50 )

27 0 (300 ) 7 0 (80 ) 3 0 (30 ) 2 0 (20 ) 4,66 0 5.15 0 5,22 0 5,22 0

2,90 0 3,17 0 3,32 0 3,32 0

1,91 0 2,05 0 2,12 0 2,25 0 Incrementa l Cos t Effectiveness , J/M g (J/ton )

68 0 (620 ) 34 0 (310 ) 0 <o r

68 0 (620 ) 1,65 0 (1,500 ) 15 0 (140 )

68 0 (620 ) 1,65 0 (1,500 ) 18,80 0 (17,070 )

a Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounde d t o th e neares t tenth . Correspond s t o 1,29 0 ng/ J (3. 0 lb/m11Ho n Btu ) S0 2 emissio n limit
. Correspond s t o 34 4 ng/ J (0. 8 lb/m1ll1o n Btu ) S0 2 emissio n limit
. Correspond s t o 12 9 ng/ J (0. 3 lb/m1ll1o n Btu ) S0 2 emissio n limit
. Correspond s t o 9 0 percen t SO- reductio n requirement
. Least-cos t optio n t o mee t regulator y alternative
. 9 Les s expensiv e t o fir e 3. 0 l b S0 2 /m1111o n Bt u oi l an d Instal l a n FG D syste m tha n t o fir e 0. 3 l b S0 2 /m1ll1o n Bt u oil
. Incrementa l cos t effectivenes s i s JO/M g o r to n since , fo r thi s case , th e least-cos t optio n t o meet bot h a ver y low sufu roi l standar d an d a percen t reductio n standar d I s t o us e a n FG D syste m an d fir e hig h sulfu roil
.P.2 0

capacit y facto r t o firin g very lo w sulfu r oi l fo r lowe r capacit y factors . Th e incrementa l C E o f S0 2 contro l associate dwit ha standar dbase donver y lo w sulfu r oi l ove r a standar dbase donlo w sulfu r oi l range dfro m $34 0 t o $1,650/M g ($31 0 t o $l,500/ton) ; th e highe r value s correspon dt o th e lowe r capacit y factors . A s a resul t o f th e impac t o f capacit y facto r o

nFG Deconomics , th e cos t impact s associate dwit ha percen t reductio nrequiremen t relativ e t o a ver y low sulfu r oi l standar dincreas e significantl y a s capacit y

utilizatio n facto r decreases . Th e incrementa l C E o f a percen t reductio nrequiremen t ove r a standar dbase donusin g ver y lo w sulfu r oi l wa s $150/M g ($140/ton ) a t 0. 3 capacit y

facto r an

d$18,800/M g ($17,070/ton ) a t 0.1 5 capacit y factor .
4. 2 Revise dImpact s fo r Oil-Fire dUnit s
Th e cos t an

dcos t effectivenes s value s fo r new oil-fire dboiler s base d o nrevise dfue l pric e projection s ar e presente dinTable s 1 1 an d12 . Th e annualize dcos t result s o f Tabl e 1 1 indicat e that , fo r th e low oi l pric e scenario , i t i s les s expensiv e t o fir e a ver y lo w sulfu r oi l t o reduc e S0 2 emission s t o 12 9 n

g S0 2 / J(0. 3 l bS0 2 /millio nBtu ) hea t inpu t tha nt o fir e a highsulfu r oi l wit ha nFG Dsystem

fo r al l size s o f boiler s examine da t a 0.5 5 annua l capacit y

utilizatio nfactor . Fo r th e highoi l price scenario , thi s same situatio ni s tru e fo r boile r size s o f 2 9 an d4 4 M W (10 0 an

d15 0 millio nBtu/hour) , bu t i s reverse dfo r large r boile r size s o f 7 3 an d11 7 M W (25 0 an d40 0 millio nBtu/hour) . Th e reaso nfo r thi s trendi s tha t th e fue l sulfu r premiu

m i s large r unde r highoi l price s tha nunde r low oi l prices . Thu s th e fue l cos t saving s associate dwit hFGDus e ar e highe r unde r highoi l price s an

doffse t mor e o f th e annualize dcost s o f th e FGDsystem tha ni s th e cas e fo r low

oi l prices . Th e cos t estimate s inTabl e 1 1 show tha t th e incrementa l C E o f S0 2 contro l associate dwit hth e us e o f lo w sulfu r oi l ove r th e regulator y baselin e range s fro

m abou t $44 0 t o $530/Mg ($40 0 t o $480/ton ) unde r bot hoi l price scenarios . Th e incrementa l C E o f S0 2 contro l associate dwit ha ver y lo w sulfu r oi l standar dove r a lo w sulfu r oi l standar drange s fro m $38 0 t o $710/M g ($34 0 t o $640/ton) . Th e incrementa l C E o f a percen t reductio n



### 1 9TABL E 11 . COS TIMPACT

S FOR OIL-FIRE D STEA M GENERATIN G UNIT S I N REGIO N V a , b (Augus t 198 6 Pric e Projections ; Jun e 198 5 J )

r o O Regulator y

Alternativ e (l b
2 9 M W(10 0 Millio n Btu/hr) : Baseline 0 Lo wSulfu rFue l Ver y Lo

wSulfu rFuel 6 Percen t Reductio n 4 4 M W(15 0 Millio n Btu/hr) : Baselin e Lo wSulfu rFue l Ver y Lo

wSulfu rFue l Percen t Reductio n 7 3 M W(25 0 Millio n Btu/hr) : Baselin e Lo wSulfu rFue l Ver y Lo wSulfu rFue l Percen t Reductio n 11 7 M W(40 0 millio n Btu/hr ) Baselin e Lo wSulfu rFue l Ver y Lo

wSulfu rFue l Percen t Reductio n 01 1 Type, 9 n g SO./ J S0 2 /m1lilo n Btu )

3. 0 0. 8 0. 3 3. 0

3. 0 0. 8 0. 3 3. 0
3. 0 0.8 . 3.0 h 3. 0

. 3. 0 0.8, . 3.0 " 3. 0 HIG H OI L PRIC E SCENARI O
Annua l Emissions , Mg/y r(tons/yr )

66 0 (720 ) 18 0 (190 ) 7 0 (70 ) 5 0 (60 )

98 0 (1,080 ) 26 0 (290 ) 10 0 (110 ) 8 0 (80 )
1,64 0 (1,810 ) 44 0 (490 ) 13 0 (140 ) 13 0 (140 )
2,62 0 (2,890 ) 70 0 (770 ) 20 0 (220 ) 20 0 (220 ) Annualize d Cost , (JlOOO/yr )
2,91 0 3,16 0 3.24 0 3.35 0

4.11 0 4,49 0 4.61 0 4,69 0
6,50 0 7,13 0 7,32 0 7,32 0
10,52 0 10,53 0 11,72 0 11,72 0 Incrementa l

Cos t Effectiveness , J/M g (J/ton )

- 53 0 (480 ) 71 0 (640 ) 7,31 0 (6,630 )

- 53 0 (480 ) 71 0 (640 ) 3,73 0 (3,380 )

- 53 0 (480 ) 61 0 (560 ) 0 (0) 1

- 53 0 (480 ) 38 0 (340 ) 0 (0) ' 01 1

" 9 Type, 9 S0,/ J (l b S0 2 /m1l1lo n Btu )

3. 0 0. 8 0. 3 3. 0

3. 0 0. 8 0. 3 3. 0
3. 0 0. 8 0. 3 3. 0

3. 0 0. 8 0. 3 3. 0 LO

WOI L PRIC E SCENARI O
Annua l Emls s ons . Mg/y r(tons/yr )

66 0 18 0 7 0 5 0

98 0 26 0 10 0 8 0
1,64 0 44 0 16 0 13 0
2,62 0 70 0 26 0 20 0 (720 ) (190 ) (70 ) (60 ) (1.080 ) (290 ) (110 ) (80 ) (1,810 ) (490 ) (180 ) (140 ) (2,890 ) (770 ) (290 ) (220 ) Annualize d

Cost , (JlOOO/yr )

2.31 0 2.52 0 2.59 0 2,76 0
3,22 0 3,54 0 3,64 0 3.80 0
5,00 0 5.54 0 5,71 0 5.84 0
8,13 0 8,99 0 9,26 0 9,35 0 Incrementa l

Cos t Effectiveness , J/M g (J/ton )

- 45 0 (400 ) 62 0 (570 ) 10,68 0 (9,690 )

- 44 0 (400 ) 61 0 (550 ) 7,08 0 (6.420 )

- 45 0 (410 ) 62 0 (560 ) 3,36 0 (3.040 )

- 45 0 (410 ) 61 0 (550 ) 1,48 0 (1.340 )

Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounde d t o neares t tenth . Capacit y utilizatio n facto r= 0.55 . Correspond s t o 1,29 0 ng/ J (3. 0 lb/millio n Btu ) S0 2 emissio n limit
. Correspond s t o 34 4 ng/ J (0. 8 lb/millio n Btu ) S O emissio n limit
. Correspond s t o 12 9 ng/ J (0. 3 lb/millio n Btu ) SO
. emissio n limit
. Correspond s t o 9 0 percen t S0

_reductio n requirement
. 9 Least-cos t optio n t o mee t regulator y alternative
. Ces s expensiv e t o fir e 3. 0 l b S O /millio n Bt u an d Instal l a n FG D syste m tha n t o fir e 0. 3 l b S0 2 /m1ll1o n Bt u oil
. 'incrementa l cos t effectivenes s I s JO/M g o rto n since , fo rthes e cases , th e least-cos t optio n t o mee t bot h a ver y lo wsulfu roi l standar d an d a percen t reductio n standar d I s t o us e a n FG D syste m an d fir e hig h sulfu roil
.TABL E 12 . COS TIMPACT

S FOR A 4 4 M

W (15 0 MILLIO N BTU/HOUR ) OIL-FIRE D STEA M GENERATIN G UNI TI N REGO N V A S A FUNCTIO N O

F CAPACIT

YUTILIZATIO N FACTORS8 (Augus t 198 6 Pric e Projections ; Jun e 198 5 J )

Regulator y Alternativ e HIG H OI L PRIC E SCENARI O LO W OI L PRIC E SCENARI O
Oi l Type, ' n g SO./ J Annua l Emissions , ( l b S0 2 /m1l1lo n Btu ) Mg/y r(tons/yr ) Annualize d Cost , (JlOOO/yr ) Incrementa l

Cos t Effectiveness , J/M g (J/ton ) Incrementa l 01 1 Type , Annua l Annualize d Cos t n g SO./ J Emissions , Cost , Effectiveness , (l b SO./mllilo n Btu ) Mg/y r(tons/yr ) (JlOOO/yr ) J/M g (J/ton )
0.5 5 Capacit y Utilizatio n Factor : Baselin e Lo wSulfu rFuel c Ver y Lo

wSulfu rFuel ' Percen t Reduction 6 3. 0 0. 8 0. 3 3. 0 0.3 0 Capacit y Utilizatio n Factor :
r o Baselin e 1 - 1 Lo

wSulfu rFue l Ver y Lo

wSulfu rFue l Percen t Reductio n 3. 0 0. 8 0. 3 3. 0
0.1 5 Capacit y

Utilizatio nFactor : Baselin e Lo w Sulfu r Fue l Very Lo w Sulfu r Fue l Percen t Reductio n 3. 0 0. 8 0. 3 3. 0 98 0 (1,080 ) 26 0 (290 ) 10 0 (110 ) 8 0 (60 )

54 0 (590 ) 14 0 (160 ) 5 0 (60 ) 4 0 (50 )

27 0 (300 ) 7 0 (80 ) 3 0 (30 ) 2 0 (20 ) 4,11 0

4,49 0 4,61 0 4,69 0

2,62 0 2.83 0 2.89 0 3,05 0

1,79 0 1.89 0 1,93 0 2,14 0 -

53 0 (480 ) 71 0 (640 ) 3.73 0 (3.380 )

53 0 (480 ) 71 0 (640 ) 12.35 0 (11,200 )

53 0 (480 ) 70 0 (630 ) 32,61 0 (29,600 ) 3. 0 O. B 0. 3 3. 0

3. 0 0. 8 0. 3 3. 0

3. 0 0. 8 0. 3 3. 0 98 0 (1,080 ) 26 0 (290 ) 10 0 (110 ) 8 0 (80 )

54 0 (590 ) 14 0 (160 ) 5 0 (60 ) 4 0 (50 )

27 0 (300 ) 7 0 (80 ) 3 0 (30 ) 2 0 (20 ) 3,22 0

3.54 0 3,64 0 3,80 0

,'2,13 0 2.31 0 2.36 0 2,57 0

- 1,55 0 1.63 0 1.66 0 1.89 0 -

44 0 (400 ) 61 0 (550 ) 7.08 0 (6.420 )

45 0 (410 ) 61 0 (560 ) 15,91 0 (14,430 )

43 0 (390 ) 63 0 (570 ) 36.04 0 (32,700 )

a Annua l emissions , annualize d costs , an d cos t effectivenes s value s rounde d t o neares t tenth . Correspond s t o 1,29 0 ng/ J (3. 0 lb/millio n Btu ) S0 2 emissio n limit
. Correspond s t o 34 4 ng/ J (O. B lb/millio n Btu ) S0 2 emissio n limit
. Correspond s t o 12 9 ng/ J (0. 3 lb/millio n Btu ) S0 2 emissio n limit
. Correspond s t o 9 0 percen t S0 2 reductio n requirement
. ^Least-cos t optio n t o mee t regulator y alternative
.P.2 3

. j «

requiremen t ove r a ver y lo w sulfu r oi l standar drange s fro m $ 0 t o $10,680/M g ($ 0 t o $9,690/ton) . Th e lowe r C E valu e result s fro m th e us e o f a

nFGD system wit hhighsulfu r oi l a s th e least-cos t optio nt o mee t bot ho f thes e regulator y

alternative s fo r large r boiler s unde r highoi l prices . A comparisono f cost s fo r oil-fire dboiler s operatin g a t lowe r capacit y utilizatio nfactor s i s presente dinTabl e 12 . Th e tabl e show s tha t th e incrementa l C E o f th e us e o f lo w sulfu r oi l ove r th e regulator y baselin e an

d th e us e o f ver y

lo w sulfu r oi l ove r low

sulfu r oi l ar e no t a functio no f capacit y utilizatio nfactor . Th e incrementa l C E o f a lo w sulfu r oi l standar dove r th e baselin e range s fro m $43 0 t o $530/Mg ($39 0 t o $480/ton) . Th e incrementa l C E o f a ver y low sulfu r oi l standar dove r a lo w sulfu r oi l standar drange s fro

m $61 0 t o $710/Mg ($55 0 t o $640/ton) . Incontrast , th e incrementa l C E valu e o f a percen t reductio nrequiremen t ove r th e us e o f ver y low sulfu r oi l increase s significantl y a s capacit y

utilizatio nfacto r decreases . Unde r low oi l prices , th e incrementa l C E valu e increase s fro m $7,080/n g ($6,420/ton ) a t 0.5 5 capacit y factor , t o $15,910/M g ($14,430/ton ) a t 0. 3 capacit y

factor , an

d$36,040/Mg ($32,700/ton ) a t 0.1 5 capacit y factor . Th e same trendapplie s t o highoi l prices .
4. 3 Compariso no f Impact s fo r Oil-Fire dUnit s Comparin g th e incrementa l C E result s fro m Section s 4. 1 an

d4. 2 fo r typica l oil-fire dboiler s (i.e. , wit h0.5 5 capacit y utilizatio nfactor) , th e conclusio nca nb e draw ntha t th e incrementa l C E value s associate dwit hth e revise dfue l pric e projection s ar e simila r inmagnitud e t o thos e associate d wit hth e previou s projection s fo r a lo w sulfu r oi l standar dan da ver y low sulfu r oi l standard . Th e incrementa l C E o f a standar dbase donusin g lo w sulfu r oi l ove r th e regulator y baselin e range s fro m $44 0 t o $530/M g ($ 0 t o $480/ton ) unde r new

pric e projections ; inth e prio r analysi s th e C E range d fro m $50 0 t o $680/M g ($45 0 t o $620/ton) . Th e incrementa l C E o f a ver y lo w sulfu r oi l standar dove r a low sulfu r oi l standar dno w range s fro

m $38 0 t o $710/M g ($34 0 t o $640/ton) ; inth e previou s analysi s thi s valu e range dfro m $ 0 t o $680/M g ($ 0 t o $620/ton) .



### 2 2P.2 4

Revise d incrementa l C E value s fo r a percen t reductio n standard , however , ar e significantl yhighe r tha n previou s values
. Afundamenta l difference i s eviden t betwee n th e previou s and revise d pric e projection s regardin g th e least-cos t optio n t o mee t a ver ylo wsulfu r oi l standard
. I n th e prio r analysis , boile r owner s chos e t o us e an FG D syste mand fir e hig h sulfu r oi l t o mee t th e ver ylo wsulfu r oi l emissio n limi t o f 12 9 n g S0 2 / J (0. 3 l b S0 2 /millio n Btu)
. Wit hne wfue l prices , boile r owner s choos e instea d t o fir e ver ylo wsulfu r oi l t o mee t thi s emissio n limi t i n al l case s excep t fo r boiler s a t o r abov e 7 3 MW (25 0 millio n Btu/hr ) unde r th e hig hoi l pric e scenario
. Thus , th e cos t o f S0 2 contro l associate d wit ha standar d base d o n usin g ver ylo wsulfu r oi l reflect s th e us e o f ver ylo wsulfu r oil , excep t a s noted
. Thes e change s hav e a significan t effec t o n th e incrementa l C E o f a percen t reductio n requiremen t ove r a very lo wsulfu r standard
. Sinc e boile r owner s chos e t o us e FG D fo r th e ver ylo wsulfu r oi l standar d i n th e previou s analysis , th e incrementa l C E o f anyadditiona l emissio n reduction s associate d wit ha standar d requirin g a percen t reductio n i n emission s wa s essentiall y$0/M g a ton . Th e situatio n i s ver ydifferen t unde r ne wfue l pric e projections
. No wa standar d requirin g a percen t reductio n i n emission s impose s additiona l cost s ove r thos e o f a ver ylo wsulfu r oi l standard
. Sinc e th e associate d decreas e i n emission s wit hth e percen t reductio n standar d i s ver ysmall , th e incrementa l C E o f thi s standar d ove r a ver ylo wsulfu r oi l standar d i s muc hhighe r and range s fro m$1,48 0 t o $10,680/M g ($1,34 0 t o $9,690/ton ) unde r lo woi l prices
. Unde r hig hoi l prices , th e incrementa l C E i s i n thi s sam e rang e fo r boiler s belo w7 3 M W (25 0 millio n Btu/hr ) bu t i s $0/M g a to n fo r large r boiler s since , a s wit h previou s pric e projections , boile r owner s choos e t o us e a n FG D syste mand fir e hig hsulfu r oi l i n respons e t o bot ha percen t reductio n standar d and a ver ylo wsulfu r oi l standard
. Fo r boiler s wit hlowe r capacit yutilizatio n factors , th e sam e trend s generall yappl yunde r bot hth e 198 4 and 198 6 fue l pric e projections
. Th e incrementa l C E value s ar e o f th e sam e orde r o f magnitud e fo r standard s base d o n usin g lo wsulfu r oi l and ver ylo wsulfu r oil
. Th e incrementa l C E o f a



### 2 3v

percen t reductio nstandar dove r a ver y low sulfu r oi l standar dis , however , significantl y

highe r unde r new

pric e projection s fo r boiler s operatin g a t lowe r capacit y

utilizatio nfactors . Th e incrementa l C E o f a percen t reductio nrequiremen t ove r a standar dbase donver y lo w sulfu r oi l range s fro m $12,35 0 t o $15,910/M g ($11,20 0 t o $14,430/ton ) a t 0. 3 capacit y facto r wit hth e new

pric e projections ; wit hth e 198 4 projection s thi s valu e wa s $150/Mg ($140/ton) . A t 0.1 5 capacity factor , th e incrementa l C E o f a percen t reductio nstandar di s $18,800/M g ($17,070/ton ) unde r th e 198 4 pric e projections , an

d$32,61 0 t o $36,040/M g ($29,60 0 t o $32,700/ton ) wit hth e new projections . Unde r bot hset s o f fue l pric e projections , th e cos t impact s associate dwit ha percen t reductio nrequiremen t relativ e t o th e us e o f ver y lo w sulfu r oi l increas e significantl y a s capacit y

utilizatio nfacto r decreases . Lik e coal-fire dsystems , thi s i s becaus e th e capita l cost s associate dwit hFGDsystem s installe dt o compl y wit ha percen t reductio n requiremen t mus t b e born e b y a smalle r numbe r o f operatin g hours . Unde r th e 198 4 projections , thi s effec t i s maske dsomewha t b y th e us e o f a

nFGDsystem wit hhighsulfu r oi l fo r bot hth e ver y lo w sulfu r oi l standar dan dth e percen t reductio nstandar da t 0.5 5 capacit y factor . Inaddition , a t 0. 3 capacit y factor , th e annualize dcost s o f usin g ver y low sulfu r oi l ar e jus t below th e cost s o f a

nFGD/hig hsulfu r oi l system ; a s a result , th e incrementa l C E o f a percen t reductio nstandar dove r a ver y lo w sulfu r fue l standar di s low . Wit hth e lowe r fue l sulfu r premium s whic hcharacteriz e th e 198 6 projections , th e incrementa l cost s o f th e us e o f FG Dar e significantl y highe r tha nth e us e o f ver y low sulfu r oi l fo r th e ful l rang e o f capacity utilizatio nfactor s examined . Sinc e th e emission s decreas e associate dwit h a percen t reductio nstandar dversu s a ver y lo w sulfu r oi l standar di s small , th e incrementa l C E value s ar e high .



### 2 45. 0 REFERENCE S

1 . Lette r fro

m Hogan , T. , Energy

an dEnvironmenta l Analysis , Inc. , t o Pahel-Short , R. , EPA/EAB . Annualize dIndustria l Coa l Prices . Augus t 29 , 1986 . 2 . Lette r fro

m Hogan , T. , Energy

an dEnvironmenta l Analysis , Inc. , t o Pahel-Short , R. , EPA/EAB . Annualize dIndustria l Oi l Prices . Augus t 26 , 1986 . 3 . Lette r fro

m Hogan , T. , Energy

an dEnvironmenta l Analysis , Inc. , t o Pahel-Short , R. , EPA/EAB . Annualize dIndustria l Natura l Ga s Prices . Augus t 27 , 1986 . 4 . Radia nCorporation . Industria l Boile r S0 2 Cos t Report . Prepare dfo r th e U.S . Environmenta l Protectio nAgency . Researc hTriangl e Park , Nort hCarolina . Publicatio nNo . EPA-450/3-85-011 . Novembe r 1984 . p . 3- 1 t o 4-7 . 5 . U.S . Environmenta l Protectio nAgency . Summary o f Regulator y

Analysis , Ne w Sourc e Performanc e Standards : Industrial-Commercial-Institutiona l Steam Generatin g Unit s o f Greate r tha n10 0 Millio nBtu/h r Hea t Input . Researc hTriangl e Park , Nort hCarolina , Jun e 1986 . p . 6- 1 t o 6-18 . 6 . Economi c Indicators . Chemica l Enqineerinq . 9 3 (16) : Augus t 18 , 1986 , p . 7 . 7 . U.S . Burea uo f Labo r Statistic s Produce r Pric e Index : Al l Industria l Commodities . Fil e 176 , Dialo g Informatio nServices , Inc . Augus t 17 , 198 5 update .



### 2 5*. > * *

APPENDI XA

METHODOLOG YFO

RREVISINGMODE L COAL - ANDOIL-FIRE D BOILE RCOS T ESTIMATE S T O INCORPORAT E NE W FUE L PRICE S
Thi s Appendi xpresent s th e methodolog y use dt o revis e th e mode l coal an doil-fire dboile r cos t estimate s inReference s 4 an d5 t o incorporat e new levelize dfue l pric e projections . Sinc e th e ne w fue l price s ar e expresse d inJun e 198 5 dollars , i t wa s als o necessar y t o updat e th e time basi s o f mode l boile r cos t estimates . T o accomplis hthes e tasks , mode l boile r cos t estimate s wer e update dusing th e relationship s betwee nannualize dcost s an d fue l price s containe dinth e origina l estimate s o f annualize dcost s (se e Referenc e 4) . Fue l price s influenc e annualize dcost s inthre e areas . Th e first , an d mos t obvious , are a involve s annua l fue l costs . Annua l fue l cost s ar e estimate das :

AF C = Q ' C F * 876 0 ' F P (1 )
where : AF C = Annua l fue l costs , $/year , Q = Boile r hea t inpu t capacity , millio nBtu/hour , C F = Annua l capacit y

utilizatio nfactor , an d F P = Fue l price , $/millio nBtu .
Thu s th e chang e i nAF C a s a resul t o f fue l pric e change s i s give nby :

AAF C = Q ' C F * 876 0 * AF P (2 )
Th e secondare a o f fue l pric e impact s involve s interes t onworkin g capita l (IWC ) associate dwit hmaintainin g a one-mont hinventor y o f fuel . Thi s quantit y

i s relate dt o AF C change s by :



### A- 1P.2 8

f

AlW C = 0.008 3 ' AAF C (3 )
Th e fina l are a o f fue l pric e impact s i s malfunctio ncosts , whic honl y applie s t o mode l stea m generatin g unit s equippe dwit hflu e ga s desulfurizatio n(FGD ) systems . Durin g period s o f FGDsyste m malfunction , th e cos t algorithm s assum e tha t th e SG

Uoperato r replace s hi s norma l fue l wit hnatura l gas . Thus , th e cos t o f malfunctio ni s th e fue l pric e differenc e betwee nnatura l ga s an dth e norma l fue l an

di s calculate das :

MC = Q ' CF ' 876 0 ' (l-REL/100 ) (NGP-FP ) (4 )
wher e MC = Malfunctio ncosts , $/year , RE L = FGDsyste

m reliability , % , an

d NG P = Natura l ga s price , $/millio nBtu . Therefore , th e chang e i nmalfunctio ncost s fro m th e origina l estimate s du e t o change s i

nnatura l ga s an

dothe r fue l price s i s give nby :

A M C = Q • C F * 876 0 ' (l-REL/100 ) (ANGP-AFP ) (5 )

A noperatin g reliabilit y o f 9 5 percen t i s assume dfo r sodiu m scrubbin g systems , whic har e use dinthi s analysi s a s th e basi s fo r FGDsystem costs . Th e chang e intota l annualize dcost s (TAC ) fo r a mode l SG Ucas e compare dt o th e origina l estimat e i s th e su m o f th e factor s discusse dabove . Afte r combinatio no f Equation s 2 , 3 , an d5 an drearrangement , th e expressio n develope dfo r change s intota l annualize dcost s is :

ATA C = Q ' C F ' 876 0 [1.008 3 AF P + (l-REL/100 ) (ANGP-AFP) ] (6 )
Th e fue l price s projecte dinAugus t 198 6 ar e expresse di nJun e 198 5 dollar s compare dt o Januar y 198 3 dollar s fo r th e Jul y 198 4 projections . Therefore , inupdatin g th e mode l boile r cos t estimate s i t wa s als o necessar y



### A-2P.2 9 

# Mr : r

t o adjus t th e time basi s fro m Januar y 198 3 t o Jun e 198 5 fo r al l othe r non-fue l costs . Thi s wa s accomplishe dusing a facto r o f 1.03 0 fo r capita l relate dcost s (base do nth e Chemica l Engineerin g Plan t Cos t Index ) an d1.03 5 fo r non-fue l operatin g an dmaintenanc e (O&M ) cost s (base do nth e Produce r Pric e Indexfo r Al l Industria l Commodities) . ' I ncase s wher e i t wa s no t appropriat e t o adjus t capita l an dnonfue l O& M

cost s separately , a naverag e facto r o f 1.03 2 wa s used . Th e methodolog y

describe dabov e wa s use dt o updat e th e origina l mode l boile r cos t estimate s wher e the y wer e available . Thi s wa s th e cas e fo r coal-fire dboiler s a t 0.6 0 capacit y facto r an

doil-fire dboiler s a t 0.5 5 capacit y factor . However , fo r bot hfue l types , annualize dcost s wer e no t readil y availabl e fo r lowe r capacit y factor s o f 0.3 0 an

d0.15 . Fo r thes e cases , therefore , i t wa s necessar y t o estimat e mode l boile r cost s usin g th e computerize dcos t algorithm s an dth e appropriat e fue l price s an dupdat e factors .



### A-3