UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

AIR AND RADIATION DIVISION

77 WEST JACKSON BOULEVARD

Vincent Hellwig, Chief

Air Quality Control Division

Michigan Department of Environmental Quality

P.O. Box 30260

Lansing, Michigan 48909

Dear Mr. Hellwig:

Thank you for Michigan’s submittal o

on our review of this submittal, we 

retrofit technology on several sources

the plan provides only for existing controls at these sources, t

impacts on the Seney Wildlife Refuge and other Class I areas, and 

effective controls may be implemented at reasonable cost. In particular, we believe that the 

following controls warrant being mandated by t

NewPage Paper – Selective Catalytic Reduction for control of NOx emissions from Boiler 

8 and Boiler 9 

St. Mary’s Cement – Selective Noncatalytic reduction for control of NOx emissions. In 

addition, a limit for sulfur dioxide emission

requiring either continuation of current use of low sulfur raw materials, or, if higher sulfur 

raw materials must be used, emission control equipment to maintain low emissions.

Tilden Mines – As required in Mi

emissions reflecting good combustion practice. In addition, a requirement for continuous 

NOx emission monitoring.

The attachment provides further details on each of these facilities and the informati

considered in reaching these conclusions. In conjunction with this attachment are 

spreadsheets showing revised estimates of costs for the above control equipment

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

REGION 5

AIR AND RADIATION DIVISION

77 WEST JACKSON BOULEVARD

CHICAGO, IL 60604-3590

REPLY TO THE ATTENTION OF:

Michigan Department of Environmental Quality

Thank you for Michigan’s submittal of a regional haze plan on November 5, 2010

on our review of this submittal, we believe that the plan does not require best available 

retrofit technology on several sources that must install and operate such control

the plan provides only for existing controls at these sources, these sources have significant 

impacts on the Seney Wildlife Refuge and other Class I areas, and we believe that 

controls may be implemented at reasonable cost. In particular, we believe that the 

following controls warrant being mandated by the Michigan plan:

Selective Catalytic Reduction for control of NOx emissions from Boiler 

Selective Noncatalytic reduction for control of NOx emissions. In 

addition, a limit for sulfur dioxide emissions reflecting current emission levels, thereby 

requiring either continuation of current use of low sulfur raw materials, or, if higher sulfur 

raw materials must be used, emission control equipment to maintain low emissions.

As required in Minnesota’s plan for similar facilities, a limit for NOx 

emissions reflecting good combustion practice. In addition, a requirement for continuous 

The attachment provides further details on each of these facilities and the informati

considered in reaching these conclusions. In conjunction with this attachment are 

spreadsheets showing revised estimates of costs for the above control equipment

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY

REPLY TO THE ATTENTION OF:

f a regional haze plan on November 5, 2010. Based 

that the plan does not require best available 

that must install and operate such control. Whereas 

ese sources have significant 

we believe that more 

controls may be implemented at reasonable cost. In particular, we believe that the 

Selective Catalytic Reduction for control of NOx emissions from Boiler 

Selective Noncatalytic reduction for control of NOx emissions. In 

s reflecting current emission levels, thereby 

requiring either continuation of current use of low sulfur raw materials, or, if higher sulfur 

raw materials must be used, emission control equipment to maintain low emissions.

nnesota’s plan for similar facilities, a limit for NOx 

emissions reflecting good combustion practice. In addition, a requirement for continuous 

The attachment provides further details on each of these facilities and the information we 

considered in reaching these conclusions. In conjunction with this attachment are 

spreadsheets showing revised estimates of costs for the above control equipment.
- 2 –

We have recently negotiated a consent decree with environmental groups to propose action 

on Michigan’s regional haze plans by May 15, 2012, to satisfy regional haze requirements 

either through approval of state plans or promulgation of federal plans. I look forward to 

working with you to resolve our concerns, so that the Michigan regional haze plan will 

have the emission limits necessary to satisfy the requirement for best available retrofit 

technology. Please contact me or John Summerhays at (312) 886-6067 if you have any 

questions.

Sincerely,

John Mooney, Chief

Air Programs Branch
Best Available Retrofit Technology

For selected Michigan Sources

NewPage Paper

Reevaluation of costs indicates that selective catalytic 

reduction (SCR) would provide cost-effective control of nitrogen 

oxides (NOx) emissions at Boiler 8 and Boiler 9 of the NewPage 

Paper company facility in Escanaba, Michigan (NewPage). 

Spreadsheets showing a revised set of cost estimates are 

attached. Many of the elements of this spreadsheet are taken 

directly from estimates provided by the company’s consultant. 

The following elements reflect the following revisions:

- In accordance with the EPA Air Pollution Control Cost Manual 

(EPA CCM), installation costs are assumed to be 85 percent of 

purchased equipment costs. The EPA CCM acknowledges that 

retrofit installations may cost somewhat more than new 

installations, but the company’s estimate, that installation 

costs would be 185 percent of purchased equipment costs, is far 

higher than the range of retrofit installation costs indicated 

in the EPA CCM. The company has not provided adequate 

justification for its assumption of such high installation 

costs.

- The company’s cost estimates include costs of plant 

infrastructure replacements that have not been justified as 

necessary for operation of SCR at Boilers 8 and 9 of NewPage 

Paper. The company assumes that installation of SCR at these 

boilers would require installation of new fans, new electrical 

equipment for operating the new fans, and new stacks for ducting 

the exhaust gas. However, the company has provided no 

justification that installation of SCR on these boilers would 

have sufficient effect on airflow at these boilers to 

necessitate these upgrades to plant infrastructure. The company 

estimated that these infrastructure upgrades would cost more 

than the SCR equipment itself. Thus, incorporating these 

upgrade costs appears to yield an unjustified and substantial 

inflation of the costs of the SCR. Only the estimated costs of 

a platform for placing control equipment have been included in 

the attached cost estimates.

- The attached spreadsheets use revised estimates of costs of 

reagent. In accordance with the EPA CCM, the necessary amount 

of urea may be assumed to be 5 percent above the stoichiometric 
- 2 –

equivalent of the quantity of NOx reduced (i.e., 5 percent more 

than 30 grams of urea per 46 grams of NOx). The urea was 

assumed to cost $450 per ton.

- The company assumes a catalyst life of 12000 hours. In 

accordance with the EPA CCM, the attached spreadsheets assume a 

catalyst life of 24000 hours.

- In accordance with the EPA CCM, the attached spreadsheets 

assume that SCRs require minimal oversight to operate, such that 

no additional labor should be budgeted for their operation.

- In accordance with the EPA CCM, the attached spreadsheet 

annualizes investment costs by assuming a 15-year equipment life 

and 7 percent interest.

- Operation of SCR will allow NewPage Paper to forgo operating 

flue gas recirculation (FGR), which the company currently 

operates for 5 months per year. Therefore, operation of SCR 

will provide a savings of the costs that would otherwise be 

expended on FGR. The company estimated that the annual 

operating cost of FGR for boiler 8 would be $245,731. Costs for 

operation of FGR at Boiler 9 are assumed to be similar. 

Therefore, the attached spreadsheet estimates the savings from 

not operating FGR at each of these boilers to equal 5/12 of 

$245,731, or $102,390. 

- A substantial fraction of the estimated costs of operating SCR 

at Boiler 9 are natural gas costs for reheating the flue gas. 

The company’s cost estimates treat this heat as waste heat that 

has no economic value to the company. However, plant operations 

require substantial process heat, and there is no reason given 

that the heat from combusting natural gas cannot be used in lieu 

of other natural gas or coal that the plant burns. In absence 

of data for a more complete analysis of this issue, the attached 

spreadsheet assumes that 3⁄4 of this heat will serve plant 

purposes in lieu of burning other fuels, and incremental costs 

of combusting natural gas in part for reheat purposes are 1⁄4 of 

the gas costs.

- In accordance with the EPA CCM, labor costs for operating an 

SCR are assumed to be negligible. 

St. Mary’s Cement
- 3 –

A reevaluation of available evidence indicates that selective 

noncatalytic reduction equipment (SNCR) would provide costeffective control of nitrogen oxides (NOx) emissions at the St. 

Mary’s Cement (SMC) facility in Charlevoix, Michigan. A 

spreadsheet is attached which shows a revised set of estimates 

of cost and cost-effectiveness for the installation of SNCR at 

this facility. Many of the elements of this spreadsheet are 

taken directly from estimates provided by the company’s 

consultant. For example, the estimates of capital costs are 

unchanged from those provided by the company’s consultant. The 

following elements reflect the following revisions:

- Electricity: The “cooler season,” for which 100 kW are 

estimated to be needed for heating urea, is assumed to be 4000 

hours.

- Clean-out: Pursuant to application number 700-77L, St. Mary’s 

Cement has been granted a permit to provide for kiln 

modifications that, in addition to providing for increased 

production, would address the plugging problems that have

occurred with operation of the current SNCR system. In EPA’s 

view, addressing the plugging problems has economic benefits for 

the company, and so the cost evaluation here assumes that the 

company will make modifications independently of SNCR 

installation that remedy these problems. Therefore, the 

attached spreadsheet assumes no costs for lost revenue due to 

clean out of cementic build-up.

- Capital recovery: In accordance with the EPA CCM, the 

equipment life should be assumed to be 15 years.

- Pollutant Removed: The Environ report included in the SMC BART 

evaluation notes that SNCR achieves between 10 and 50 percent 

NOx control efficiency. While the current SNCR may have 

problems that limit its effectiveness to eliminating only 10 

percent of NOx emissions, Michigan must evaluate control options 

which significant improve SMC’s NOx control efficiency. The 

BART determination cannot plausibly estimate substantial capital 

costs that achieve no improvement in NOx control as compared to 

existing equipment. The attached spreadsheet assumes that the 

upgraded control equipment will achieve 40 percent NOx control. 

This control efficiency is applied against the full 5741 tons 

per year baseline emission level, since the submittal provides 

no justification that future operation should assume different 

operations (e.g., a different number of hours of operation per 

year) than existed in the baseline period.
- 4 –

- The attached spreadsheet uses the company’s estimate of 

reagent costs. This assumes compensating adjustments to reflect 

use of a greater quantity of urea to achieve 40 percent control 

and to reflect a lower cost of urea solution.

- The revised spreadsheet estimates that SNCR would reduce NOx 

emissions at SMC’s facility at a cost of $865 per ton. Since 

this control would achieve substantial improvement in visibility 

at the Seney Wildlife Refuge, this evidence suggests that BART 

at this facility would include full year operation of upgraded 

SNCR.

- The evaluation of BART for sulfur dioxide (SO2) at the SMC 

facility is premised on the sulfur contents of materials in the 

future remaining similar to current sulfur contents. The 

submittal raises the possibility that future raw material may 

contain significantly more sulfur. Such an increase would make 

SO2 control equipment more cost effective, since equipment at 

similar cost would control more SO2 emissions. While SO2 

control equipment appears under current circumstances to be 

marginally more expensive than would be considered costeffective, it appears likely that SO2 control equipment would be 

cost-effective if the sulfur content of the raw materials 

increased.

Therefore, this evidence suggests that current SO2 emissions 

represent BART for this facility. SMC could achieve current SO2 

emissions either by continuing to use comparatively low sulfur 

raw materials or by operating SO2 control equipment to 

accommodate use of higher sulfur raw materials. Under 

Michigan’s submittal, SMC is allowed much greater SO2 emissions 

than are currently emitted (as requested by SMC to accommodate 

higher sulfur raw materials). An emission limit reflecting 

current SO2 emissions is necessary to assure that BART is in 

place for SO2 for SMC.

Tilden Mine

Available evidence indicates that BART control for NOx at Tilden 

Mine is good combustion control. Michigan’s SIP does not 

include limits on NOx emissions that mandate good combustion 

control, and Michigan’s SIP does not provide for adequate 

monitoring for judging whether emissions are being appropriately 

controlled. 
- 5 –

Substantial information on NOx emissions from well controlled 

taconite plants is available from continuous emission monitoring 

data for various taconite plants in Minnesota. This monitoring 

provides sufficient information to determine the NOx emission 

levels that can be achieved through good combustion control. 

Michigan must set a NOx emission limit that is sufficiently 

stringent to assure good combustion control.

Michigan must also require installation and operation of a 

continuous emission monitoring system that provides for 

continuous monitoring of NOx emissions in accordance with 

Performance Specification 2 in Appendix B of 40 CFR 60. This 

monitoring will serve several purposes: 1) this monitoring will 

provide continuous information for assessing whether the 

facility is implementing good combustion control, 2) this 

monitoring will help define the operating conditions in which 

higher and lower NOx emissions occur, and 3) thereby, this 

monitoring will help the facility and the State determine how to 

minimize NOx emissions.
- 6 –

standard bcc’s: official file copy w/enclosure

originator’s file copy w/enclosure

originating office reading file w/enclosure

other bcc’s:

ARD: APB: APMS: js: 11/xx/2011

file: f:/jsummerh/MI/Regional Haze/MI Haze 12-11.doc