MEMORANDUM

Date: September 16, 2013

TO: Docket No. EPA

- HQ

- OAR

- 2012

- 0510: National Emissions Standards for Hazardous Air Pollutants for Flexible Polyurethane Foam Production

FROM: Kaye Whitfield, EPA/OAQPS/SPPD

SUBJECT: Technology Review and Cost Impacts for the Proposed Amendments to the Flexible Polyurethane Foam Production Source Catego ry National Emissions Standards for Hazardous Air Pollutants (40 CFR part 63, subpart III)

1.0 INTRODUCTION

Section 112 of the Clean Air Act (CAA) requires the U.S. Environmental Protection Agency (EPA) to establish technology

- based standards for li sted source categories. These technology

based standards are often referred to as maximum achievable control technology (MACT)

standards. The Flexible Polyurethane Foam (FPUF) Production MACT standard (40 CFR part 63, subpart III ) applies to major sources and regulates HAP emissions from three separate types of foam production operations: slabstock flexible polyurethane foam (i.e., slabstock foam), molded flexible polyurethane foam (i.e., molded foam), and rebond foam. T he FPUF Production

MACT standard includes requi rements for foam production lines, storage vessels, transfer

pumps
, equipment leaks , and hazardous air pollutant ( HAP ) use restrictions and prohibitions

.

Section 112 also contains provisions requiring the EPA to periodically revisit these standards. Speci fically, section 112(d)(6) states:

(6) REVIEW AND REVISION.

– The Administrator shall review, and revise as necessary (taking into account developments in practices, processes, and control technologies), emissions standards promulgated under this section no less often than every 8 years.

To comply with this CAA requirement, the EPA conducted a technology review for the FPUF

Production MA CT standard for major sources. For the purposes of reviewing a MACT standard, the EPA considers a “development” in practices, proce sses, and control technologies to be:

• Any add

- on control technology or other equipment that was not identified and considered during development of the original MACT standards.2 • Any improvements in add

- on control technology or other equipment (that were ide ntified and considered during development of the original MACT standards) that could result in significant additional emissions reduction.

• Any work practice or operational procedure that was not identified or considered during development of the original M ACT standards.

• Any process change or pollution prevention alternative that could be broadly applied to the industry and that was not identified or considered during development of the original

MACT standards.

• Any significant changes in the cost (including cost effectiveness) of applying controls (including controls the EPA considered during the development of the original MACT standards).

Section 2 of this memorandum presents a background of the FPUF Production source category
and Section 3 presents a summary of the s ources of data that were used to conduct the technology review. Sections 4 through 6 present the summaries of the technology reviews related

to HAP ABA use at slabstock foam production facilities, the slabstock foam production line, diisocyanate storage ve ssels and diisocyanate equipment leaks.

2.0 DESCRIPTION OF THE SOURCE CATEGORY AND MACT STANDARD

The flexible polyurethane foam industry encompasses three separate types of foam production operations: slabstock flexible polyurethan e foam (i.e., slabstock foam), molded flexible polyurethane foam (i.e., molded foam), and rebond foam. Slabstock foam is produced in large continuous buns that are then cut into the desired size and shape (fabricated). Slabstock foam is used in furniture, bedding, packaging, and carpet cushioning. Molded foam is produced by "shooting" the foam mixture into a mold of the desired shape and size. The major use of molded foam, by weight, is in automobile interiors, but is used in many other applications such as packaging, novelty applications, and medical supplies. Rebond foam is made from scrap foam that is converted into a material primarily used for carpet underlay.

The FPUF Production MACT standard s w ere originally proposed in the Federal Register on December 27, 199 6 ( 61 FR 68418 ) and promulgated on October 7, 1998 ( 63 FR 539 80 ). The

FPUF Production MACT standards for flexible polyurethane foam production contain requirements specific to the type of foam produced. For slabstock foam production, the FPUF

Production MACT standards include d iisocyanate and HAP auxiliary blowing agents ( ABA ) emissions reduction requirements. For diisocyanate emissions from slab stock foam production,

the FPU F Production MACT standards ha ve requirements for storage vessels, transfer pumps and equipment leaks. Standards for HAP ABA emissions at slabstock facilities include requirements for storage vessels, equipment leaks, the production line, and equipment cleaning. For molded and rebond foam production, the FPUF Production MACT standards include HAP

use restrictions. The requirements of the standards are the same for both new and existing

sources.

For diisocyanate emissions from slabstock foam production, the FPUF Production MACT

standards ha ve requirements for storage vessels, transfer pumps and equipment leaks. The storage vessels requirement s include the installation of either a vapor recovery system or a carbon adsorption system. Transfer pumps are required to be either sealless pumps or pumps3 submerged in a neutral oil, and submerged pumps must be visually inspected periodically for

leaks. Other components in diisocyanate service must be repaired when a leak is detected.

Standards for HAP ABA emissions at slabstock facilities include requirements for storage vessels, equipment leaks, the production line, and equipment cleaning. For HAP ABA storage vessels, the FPUF Production MACT standards require installation of either a vapor recovery system, or a carbon adsorption system. For HAP ABA equipment leaks, the FPUF Production

MACT standards require a leak detection and repair (LDAR) program. For the slabstock prod uction line, the amount of HAP ABA that can be used is restricted , calculated via a chart and a formula and based on production levels and the types of foam produced. HAP ABA use is only allowed for production of certain low

- density grades of foam. The use of HAP or HAP

- based products for equipment cleaning in slabstock foam production is prohibited. The rule also

includes a “source

- wide” HAP ABA alternative emission limit that allows slabstock facilities to comply by limiting the total amount of HAP ABA us ed at the facility (rather than by complying with the emission point

- specific requirements). The “source

- wide” HAP ABA usage limit is

calculated in the same manner as the emission

- point specific limit.

For molded foam and rebond foam production, the FPUF Production MACT standards prohibit the use of any HAP

- based product as an equipment cleaner or as a mold release agent (with an exception for diisocyanates used for startup and maintenance mix head flush on molded foam lines, which must be contained in a closed

- loop system).

Various other practices, processes, and control technologies were considered in the development

of the MACT standards , which are summarized below in Table 1 . Additional information on these control techniques can be found in the Background Infor mation and Supplementary Information Documents used to support the FPUF Production MACT standard rulemaking. 1

1 Hazardous Air Pollutant Emissions from the Production of Flexible Polyurethane Foam Basis and Purpose

Documen t for Proposed Standards

, E mission S tandards D ivision U

. S

. E nvironmental P rotection A gency, S eptember

1996

.4 Table 1 . Summary of Practices, Processes, and Control Technologies Identified and

Considered During Flexible Polyurethane Foam Production MACT Standards

De velopment

Source Category/

Emission Source Practices, Processes, and Control Technologies

Slabstock

– Storage Vapor balancing system, c arbon adsorption

Slabstock

– Equipment L eaks LDAR program, e quipment modification (leakless pumps)

Slabstock

– Equipm ent

C leaning Steam cleaning, m aterial substitution ( n on

- HAP cleaners)

Slabstock

– Foam Repair Hot

- melt adhesives, water

- based adhesives, hydrofuse

adhesive

Slabstock

– Foam Tunnel Non

- HAP ABA (Acetone or CO 2 ), f oaming in controlled

environment, forced c ooling, chemical modification,
carbon adsorption

Molded

– Mixhead Flush Non

- HAP flush, high pressure mixheads, self

- cleaning
mixheads, solvent recovery

Molded

– Mold Release Material substitution ( n on

- HAP mold release agents)

,

r educed

- VOC solvent agents

Molded

– Equipment Cleaning Material substitution ( n on

- HAP cleaners)

Molded

– Foam Repair Hot

- melt adhesives, water

- based adhesives, hydrofuse

adhesive

Rebond

– Mold Release Mat erial substitution (n on

- HAP mold release agents)

Rebond

– Equipment Cleanin g Material substitution (n on

- HAP cleaners)

3.0 SOURCES OF AVAILABLE CONTROL TECHNOLOGY INFORMATION

To identify developments in practices, processes and control technologies since the MACT standards were developed , we consulted the following sources of data :

• C ontacts with the industry

• R egulatory analyses performed by the EPA and State regulatory agencies

• State Regulations

• The EPA’s RACT/BAC T/LAER clearinghouse5 3 .1 Contact with Industry

Industry trade organizations were consulted several times dur ing the residual risk and technology (RTR) review process for FPUF Production

. The primary source of industry information was the Polyurethane Foam Association (PFA), a trade association representing the slabstock polyurethane foam production industry

. Information was also collected directly from individual

foam production companies through a 2011 survey performed under Section 114 of the CAA

. Information from individual foam production facilities was also gained through site visits conducted at four foam production facilities in 2012 and 2013.

Partially through contact with industry representatives, the EPA learned that HAP ABA use has been completely discontinued by foam producers in the U.S. This development in industry practice for HAP emissions reduction is dis cussed further in Section 4.1.

3. 2 State Regulations

The EPA became aware of some state or local air permitting agencies regulations that apply to

FPUF Production

, s pecifically, California’s South Coast Air Quality Management District (SCAQMD) Rule 1175 for control of emissions from the manufacture of polymeric cellular (foam) products. In seeking other state or local regulations that would apply to foam production facilities, both a general in ternet search and a more targeted search directed at s tates known to

have multiple foam production facilities (major and non

- major sources) was conducted.

SCAQMD Rule 1175 is specific to the manufacture of polymeric cellular (foam) products, but addresses VOC emissions with no process specific requirements. It includes a proh ibition on the use of methylene chloride, the most commonly used HAP ABA, for foam production. However, the methylene chloride prohibition went into effect on January 1, 1994, which is before the promulgation date of the FPUF Production standards. For this reason, th is rule requirement was not considered as a development in practice, process, or control technolog y since the MACT standard was developed.

3. 3 EPA Analyses

For the FPUF Productio n source category technology review, the EPA also considered other technology reviews the Agency has conducted for source categories that would have similar equipment or sources of emissions.

The specific technology reviews considered include those for the Group IV Polymers and Resins (P&R IV), Pesticide Active Ingredient Production (PA I ), and Polyether Polyols Production (PEPO) that w ere recently conducted for a 2012 proposed RTR action for these source categories . Th e s e technology review s w ere considered due to the m being recently complet ed and because these source categories also have st orage vessels and equipment leaks as HAP emissions sources. Similarly

, the technology review analyses for the National Uniform Emission Standards for Storage Vessel and Transfer Operations, and Equipment Leaks w ere also considered in this

review

. Although th ese analys e s are not based directly on operations in the FPUF Production
source category, the EPA believes that they are appropriate to consider with regard to FPUF6 Production storage vessels and equipment leaks because the process operations and equipment components are simi lar

. Even though these industries may have variations in their process operations and the regulated materials used, the emission sources are generally amenable to similar methods for control and demonstration of compliance. Thus

, it is expected that compli ance methods that have been determined to be cost effective for control of a specific amount of a given regulated material at one of the emission points would generally be cost effective for the same regulated material at similar emission points.

In addi tion, a review of an EPA s urvey of control technologies for low concentration organic vapor gas streams was conducted

, due to the relevance of this information to the emissions from storage vessels in the FPUF production industry.

Several potential develo pments in practices, processes and control technologies were identified through these reviews, which are discussed further in Sections 4.3 for storage vessels and 4.4 for equipment leaks.

3

. 4 RACT/BACT/LAER Clearinghouse Database

Under the EPA's New Sour ce Review (NSR) program, if a company is planning to build a new plant or modify an existing plant such that criteria air pollution emissions will increase by a certain amount, then the company must obtain an NSR permit. The NSR permit is a construction

pe rmit which generally requires the company to minimize air pollution emissions by changing the process to prevent air pollution and/or installing air pollution control equipment.

The terms "RACT," "BACT," and "LAER" are acronyms for different program requ irements relevant to the NSR program. RACT, or Reasonably Available Control Technology, is required on sources in areas that are not meeting national ambient air quality standards (non

- attainment areas). BACT, or Best Available Control Technology, is requi red on new or modified major sources in clean areas (attainment areas). LAER, or Lowest Achievable Emission Rate, is required on new or modified major sources in non

- attainment areas.

BACT and LAER (and sometimes RACT) are determined on a case

- by

- case ba sis, usually by State or local permitting agencies. The EPA established the RACT/BACT/LAER Clearinghouse, or RBLC, to provide a central data base of air pollution technology information (including past BACT and LAER decisions contained in NSR permits) to p romote the sharing of information among permitting agencies and to aid in future case

- by

- case determinations. However, data in the RBLC are not limited to sources subject to RACT, BACT, and LAER requirements. Noteworthy prevention and control technology de cisions and information may be included even if they are not related to past RACT, BACT, or LAER decisions. 2

The RBLC contains over 5,000 air pollution control permit determinations that can help identify appropriate technologies to mitigate most air poll utant emission streams. It was designed to help permit applicants and reviewers make pollution prevention and control technology decisions for

2 Technology Transfer Network: Clean Air Technology Center. RACT/BACT/LAER Clearinghouse Basic Information. http://www.epa.gov/ttn/catc/rblc/htm/welcome_eg.html

.7 stationary air pollution sources, and includes data submitted by several U.S. territories and all 50

States on ov er 200 different air pollutants and 1,000 industrial processes.

The RBLC provides several options for searching the permit database on

- line to locate applicable control technologies. On June 27 , 2012, we conducted a search of the RBLC. Our search specifi ed VOC

- and HAP

- emitting processes from North American Industry Classification System (NAICS) codes 326510 and SIC 3086. 3 The search results included the following data fields:

• RBLC ID;

• Facility Name, and State;

• Permit Date;

• Process name;

• Throughput;

• Pol lutant;

• Control technology; and

• Percent efficiency of control.

The results of the search a re presented in Attachment 1

. Only one process, practice, or control technology was identified for a FPUF facility

- for reduction of VOC from application of mold

re lease agents at a molded foam facility in Michigan

. The existing FPUF Production MACT

standards prohibit HAP

- based mold release agents. Therefore, this exercise did not reveal any developments in practices, processes, or control technologies for HAP emissions from FP UF

p roduction facilities

.

4 .0 IDENTIFIED DEVELOPMENTS IN PRACTICES, PROCESSES AND

CONTROL TECHNOLOGIES AND ESTIMATED COST IMPACTS

Through searches of the data sources described in section 3

, several developments in practices, process or control technologies were identified for the FPUF Production source category

. Each of these developments is presented below. An e ngineering cost analys i s was performed for each of t hese options to determine whether these developments could cost

effectively be put in place for the FPUF Production source category , and the results of these analyses are presented below.

4 .1 HAP ABA Use in Slabstock Foam Production

During the development of the FPUF Production MACT standard, several technologies were identified which allowed reduction or elimination of HAP by swit ching to non

- HAP products for equipment cleaning, mixhead flushing, mold releasing, and as ABA. The FPUF Production MACT standard prohibited the use of HAP products for equipment cleaning, mixhead flushing, and mold releasing at molded and rebond foam facilities and prohibited their use for equipment cleaning at slabstock foam facilities (except at facilities operating under the provisions for a

3 These NAICS and SIC code s were chosen to be inclusive of facilities in the FPUF source category

. They also include facilities not in the FPUF source category.8 source

- wide emission limit for a single HAP ABA). However, based on feedback from industry and EPA’s assessment of productio n at that time, the EPA believed that HAP ABA use was necessary for production of some grades of foam. Therefore, the FPUF Production MACT standards significantly limited the use of HAP ABA by slabstock foam producers, but still allowed their use in production of cer tain grades of foam, defined by density and Indentation Force Deflection (I FD )

.

Available data from EPA databases , the 2011 Section 114 survey, and information from State and local permitting agencies show that none of the 13 facilities which were identif ied as being subject to the FPUF Production MACT standards are currently using any HAP ABA. 4 Th e absence of HAP ABA use was confirmed through discussion with PFA representatives, who

stated that the few facilities who had continued using HAP ABA s after the promulgati on of the

Foam Production MACT standards and Area Source rules (40 CFR 63 Subparts III and OOOOOO) have since discontinued any use of HAP ABA s, and the products now used contain

no HAP

. 5 The complete discontinuation of HAP ABA use by FPUF producers demonst rates that foam producers have improved their ability to produce their products using alternatives to HAP ABA, which is a practice, process, or control technology that would be considered to be a development since the FPUF Production MACT standards were developed

.

As no facilities subject to subpart III are currently using any HAP or HAP

- based product as an ABA, we estimated there will be no cost associated with prohibit ing the use of HAP and HAP

based ABA s

. Although it is difficult to quantify, we believe t here may even be a small cost savings at some facilities due to reduced recordkeeping and reporting costs.

4

. 2 Storage Vessels

During the development of the FPUF Production MACT standards, t wo compliance options were

considered for diisocyanate storage vessels: equip ping t he storage vessels (tanks) with a vapor return line from the storage vessel to the truck or rail car during unloading; and equip ping with a carbon adsorption system which routes displaced vapors through activated carbon. The vapor
return system wa s assumed to have a control efficiency of 95 percent

. 6 At the time of the MACT development, no control options that would result in a higher level of control were reported to be in use in the industry or appear to have been considered during the rule development

. A s noted in

Section 3. 3 , f or this technology review, a review of a survey of control technologies for low

concentration organic vapor gas streams performed by the EPA 7 was conducted, which identified

control technologies that could achieve higher control ef ficiencies than the controls currently required by the FPUF Production MACT standards for storage vessels

. These technologies are regenerative thermal oxidizer s (RTO) and recuperative thermal oxidizer s (RCO) , which are capable of achieving 98

- percent control efficien cy.

4 See “ Dra ft Development of the RTR Emissions Dataset for the Flexible Polyurethane Foam Production Source Category ” in the docket for the FPUF RTR.

5 See “Documentation of Communications with Industry and Regulatory Agency Contacts for the Flexible Polyurethane Foa m Industry” in the docket for the FPUF RTR.

6 Gasoline Distribution Industry (Stage I)

- Background Information Standards . U.S. Environmental Protection Agency. Research Triangle Park, North Carolina. Publication No. EPA

- 453/R

- 94

- 002a. January 1994.

7 Surv ey of Control Technologies for Low Concentration Organic Vapor Gas Streams U.S. Environmental Protection Agency. Research Triangle Park, North Carolina. Publication No. EPA

- 456/R

- 95

- 003. May 1995.9 To determine whether either of these technologies could cost effectively reduce diisocyanate emissions from storage vessels at FPUF p roduction facilities, a cost analysis was performed. For diisocyanate tanks, it is estimated that an additional emission reducti on of 0.0026 tpy would be associated with an increase from 95 to 98 percent HAP control. The estimated cost per ton of emissions reduction would be $124 million and $2 69 million per ton of HAP using an RTO and RCO, respectively. Table 3 summarizes the calc ulated e stimated c osts and c ost e ffectiveness

associated with this increase in c ontrol e fficiency

.

Table 3

. Estimated Costs and Cost Effectiveness of Increasing Control Efficiency for Slabstock Diisocyanate Storage Tanks

Type of Equipment Current Level o f Control Control Option 1 Control Option 2

Tanks (Uncontrolled) Vapor Balancing/Carbon

Adsorber Regenerative

Thermal

Oxidation Recuperative

Thermal

Oxidation Facility Capital Cost 1 NA $6,150 $895,281 $537,915
Facility Annual Cost 1 NA $1,133 $325,603 $7 02,280
Facility HAP Emissions (tpy) 2 0.0867 0.0043 0.0017 0.0017

HAP Reduction from Uncontrolled (tpy) NA 0.08237 0.08497 0.08497

HAP Cost Effectiveness ($/T on) NA $13,759 $3,832,154 $8,265,426

Incremental HAP Cost

E ffectiveness (vs. Vap. Bal.)($/T on) $124,245,790 $269,065,995

1 Cost estimates for RTO and RCO are based on methodology set out in the EPA Air Pollution Control Cost Manual (Sixth Edition), EPA/452/B

- 02

- 001, January 2002 Additional deta ils are included in Attachment 3

. 2 Tanks emissions were estimated based on average data from Section 114 survey facilities reporting tank

emissions. Uncontrolled emissions were estimated by assuming that current reported emissions are 5% of the

uncontrolled baseline.

4

. 3 Equipment Leaks

During the devel opment of the FPUF Production MACT, an LDAR program was identified as a method for controlling emissions from equipment leaks at slabstock foam facilities for both HAP ABA and diisocyanates, and a LDAR program was required for equipment in HAP ABA service.

N umeric le ak detection limits were not required for metering pumps, valves, connectors, and

open

- ended lines in diisocyanate service at slabstock foam production facilities . The standards require that if “evidence of a leak is found by visual, audible, or any other detection method, it shall be repaired as soon as practicable, but not later than 15 calendar days after it is detected

. ”

As noted in Section 3. 3 of this memo, a review of o ther technology reviews the Agency has conducted for source categories that would h ave similar equipment or sources of emissions was conducted, which identified developments in LDAR programs that could reduce emissions

further than equipment leak control program currently required by the FPUF Production MACT10 standards for diisocyanate emissions at slabstock foam production facilities

. These developments

include:

• LDAR programs incorporating the use of EPA Method 21 and revised leak detection

limits

• Low

- leak technology for valves, gaskets, and flanges

• Limit s to the number of components allowed to be placed on a delay of repair list

Each of these developments are discussed below in S ection s 4. 3 .1, 4. 3 .2, and 4. 3 .3.

4. 3 .1 LDAR P rograms I ncorporating EPA Method 21 and Various L eak D etection L imits

As noted in Sect i on 3. 3 , reviews of the EPA analyses were conducted, including a n a nalys i s regarding LDAR programs and “low

- leak” technologies performed in the development of the National Uniform Emission Standards for Storage Vessel and Transfer Operations, and Equipment Leaks (40 CFR part 65, subparts H a nd I)

. 8 Th is analys i s w as developed for the purpose of providing consistent requirements for equipment leaks that could be referenced by multiple NESHAP subparts, and it incorporate s technical improvements based on the EPA’s experience with implementation of other subparts, such as the National Emission Standards for Petroleum Refineries (40 CFR part 60, subpart CC). As part of this process, the EPA investigated current practices and advances in technology and examined the cost effectiveness of applying

ce rtain technologies for control. For this analysis, the EPA a lso reviewed the applicability determination index database, test reports, title V permit requirements, Office of Enforcement and Compliance Assurance experience and recent EPA decisions to identi fy cost

- effective technological, monitoring and compliance approaches that would reduce burden across source categories.

The EPA also considered the results of the technology reviews for the P&R IV, PAI , and PEPO source categories that were recently condu cted for a 2012 proposed RTR action. In addition, comments were received on this proposed RTR action that suggested that the EPA should also consider several additional improvements in LDAR programs that the EPA did not identify in th e proposal technology review. As part of the technology review for the FPUF p roduction source category, the EPA considered these suggestions for application to the FPUF Production MACT

standard.

Based on these data sources

, the implementation of a more stringent LDAR program than currently exists for diisocyanate equipment leak emissions, incorporating lower leak detection

limits than those considered during the FPUF Production MACT development, monitored via Method 21 of 40 CFR part 60, appendix A, was identified as a development in a process, practice, or c ontrol technolog y that could reduce these emissions from slabstock production

facilities. Two options for a more stringent LDAR program were considered, based on the EPA

uniform standards analysis and public comments received on the P&R IV, PAI, and PEPO

t echnology review

. In addition, analysis of the costs of the basic LDAR program, similar to that required by the FPUF Production MACT standard for HAP ABA emissions, was performed to

8 Memorandum from Cindy Hancy, RTI to Jodi Howard, EPA, Ana lysis of Emission Reduction Techniques for Equipment Leaks

, December 21, 2011. ( EPA

- HQ

- OAR

- 2002

- 0037

- 0180 .) See Attachment 311 provide the basic costs of the LDAR program for a starting point from which to gauge the more stringent options.

Table 4 shows the options which were considered for implementing a more stringent LDAR program incorporating leak detection limits monitored via Method 21 of 40 CFR part 60, appendix A. The b ase LDAR program and the two option s are presented below and in Table 4.

(B ase LDAR): I mplementation of a leak detection program , with leak detection limits for pump seals and valves of 10,000 parts per million (ppm) , leak definition for connectors of 500 ppm; and caps on open

- ended line s

(Option 1): Same as base LDAR , but with leak definition s for pump seals lowered to 2,000 ppm and valves lowered to 500 ppm

(Option 2): Same as Option 1 , but with the leak definition for pump seals lowered to 500 ppm and valves lowered to 100 ppm.

Tab le 5 details the calculated estimated costs and cost effectiveness associated with each option.

It is estimated that the capital and annual costs of the base LDAR program are approximately $ 32 ,000 and $ 28

, 0 00 per year, respectively, and the emission reduc tion would be 0. 323 tpy relative to the existing equipment leak repair program. The cost effectiveness of the base LDAR

program is estimated to be $ 87 ,000/ton of HAP reduced.

For the first and second options incorporating reduced leak detection limits , i t is estimated that the capital and annual costs would be nearly the same as the first option, but with slightly

increased emission reduction s . Estimated emissions reductions of 0. 376 tpy and 0. 384 tpy are associated with options 1 and 2 , respectively. The cost effectiveness of these options is estimated

at approximately $ 75 ,000/ton of HAP reduced for the first option and $ 73 ,000/ton HAP reduced

for the second option.Table 4. LDAR Program Options Evaluated for Slabstock Diisocyanate Equipment L eaks

Type of Equipment No. of Components Current Level of

Control Base LDAR Control Option 2 Control Option 3

Slabstock Diisocyanate Equipment Leaks
Pump Seals 4 Weekly visual inspection Monthly Method 21 monitoring (10,000 ppm leak
definition) Lowers leak
definition to 2,000

ppm Lowers leak

definition to 500

ppm

Valves 32 Visual, audible, or any other

detection method Monthly Method 21 monitoring (10,000 ppm leak
definition) Lowers leak

definition to 500

ppm Lowers leak

definition to 100

ppm

Connectors 40 Visual, audible, or any other

detection method Monthly Quarterly

Method 21 monitoring (500 ppm leak
d fi i i ) Same as Option 1 Same as Option 1

Open-Ended

Lines 12 Visual, audible, or any other

detection method Cap or comparable Same as Option 1 Same as Option 113 Tab le 5. Estimated Costs and Cost Effectiveness of Enhanced LDAR Program s for Slabstock Diisocyanate Equipment Leaks 1

Model Plant Total Capital

Investment Incremental Capital

Investment Annual

LDAR Cost ($/yr) Incremental

Annual

LDAR Cost ($/yr) Total HAP

Emissions (Tons/yr) HAP

Emission

Reductions

from

Baseline (Tons/yr) Incremental

HAP

Reduction (Tons/yr) HAP Cost

Effectiveness

from

Baseline ($/Ton) Incremental

HAP Cost

Effectiveness ($/Ton)

LDAR Program

Baseline $1

----- $44

----- 0.492

----- ----- ----- -----
Base LDAR $32,237 $32,236 $28,157 $28,113 0.169 0.323 0.3234 $86,933 $86 ,933

Option 1 $32,416 $179 $28,163 $6 0.116 0.376 0.0531 $74,691 $106

Option 2 $32,482 $66 $28,176 $13 0.108 0.384 0.0079 $73,182 $1,659

Pumps

Baseline $1

----- $40

----- 0.0950

----- ----- ----- -----

Base LDAR $29,727 $29,726 $27,484 $27,444 0.0194 0.0756 0.0756 $362,885 $362,885

Option 1 $29,875 $148 $27,514 $30 0.0054 0.0896 0.0140 $306,464 $2,134

Option 2 $29,942 $66 $27,538 $24 0.0041 0.0909 0.0013 $302,458 $18,986

Valves

Baseline $0

----- $3

----- 0.1449

----- ----- ----- -----

Base LDAR $3 0,440 $30,440 $27,727 $27,723 0.0964 0.0485 0.0485 $572,190 $572,190

Option 1 $30,470 $30 $27,731 $4 0.0574 0.0875 0.0391 $316,855 $110

Option 2 $30,624 $154 $27,780 $49 0.0507 0.0942 0.0067 $294,923 $7,369

Connectors

Baseline $0

----- $1

----- 0. 0949

----- ----- ----- -----

Base LDAR $29,720 $29,720 $27,466 $27,465 0.0501 0.0448 0.0448 $612,990 $612,990

Open

- Ended Lines

Baseline $0

----- $0

----- 0.1576

----- ----- ----- -----

Base LDAR $31,361 $31,361 $27,786 $27,786 0.0031 0.1545 0.1 545 $179,837 $179,837

1 Equipment leak HAP emission factors and cost estimation methodology from Memorandum from Cindy Hancy, RTI to Jodi Howard, EPA , Analysis of

Emiss i on Reduction Techniques for Equipment Leaks, December 21, 2011. [EPA

- HQ

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- 2002

- 0037

- 0180]14 4. 3 .2 “Low

- Leak” Packing for V alves in Diisocyanate Service

As noted in S ection 3. 3 , t he EPA considered the results of the tec hnology reviews for t he (P&R IV, PA I , and Polyether PEPO source categories that were recently conducted for a 2012 proposed RTR action for these source categories. One of the comments the EPA received on this proposed RTR action was that t he EPA should als o consider several additional improvements in LDAR programs that the EPA did not identify in this technology review. Therefore, a s part of the technology review for the FPUF p roduction source category, we also considered the comments received on the proposed RTR for the P&R IV, PAI and PEPO source categories for application to the FPUF p roduction MACT standard. One potentially applicable suggestion was

that “low

- leak” technologies could be used for certain components. Therefore, we also evaluated

l ow

- leak valves in diisocyanate service in this analysis.

“L ow

- leak ” packing for valves that significantly reduce emissions are in place in some facilities

outside the FPUF Production source category , particularly oil refineries. Facilities and packing manufacturers have created emission testing p rotocols for low

- leak packing in order to study and

test their effectiveness. 9 As described above, the use of low

- leak technology was identified as a practice, process, or control technology that would be considered to be a development since the

FPUF Production MACT standards were developed.

W e analyzed the costs associated requiring low

- leak valve technology for the FPUF Production
source category using costs for low

- leak valves

, which were previously estimated for the synthetic organic chemical manufacturing industry (SOCMI)

. 10

, 11 According to the SOCMI calculations, the nationwide total capital investment for low

- leak valves was estimated to be $5.7 billion. The nationwide annual cost for the SOCMI was $780 million/yr with a HAP emission

reduction of 3,200 tpy. 12

According to the background information for these costs, total capital investment and total annualized costs are proportional to the number of valves and therefore

, proportional to the

emissions from the valves. Th us , assuming that emissions from valves are constant an d that the cost per valve is constant, we calculated a dollar per ton total capital investment factor for these

low

- leak valves of $ 3

. 9 million/ton HAP emissions and a total annualized cost factor of $ 542 ,000/yr/ton HAP (escalated from 2005 to 2011 dollars ). 13

, 14

Using these factors, n ationwide annual costs for the FPUF Production source category were estimated to be $ 310 ,000/yr, with total capital investments of $ 2

, 26 0,000. Emission reductions

9 See Reference 5.

10 National Emission Standards for Hazardous Air Pollutants for Organic Hazardous Air Pollutants f rom the Synthet ic Organic Chemical Manufacturing Industry: Proposed Rule. 71 FR 34422, June 14, 2006

11 Memorandum from Oommen, R., ERG, Morrisville, NC, to McDonald, R., U.S. Environmental Protection Agency, OAQPS. Cost and Emission Reduction of Leakless Valves for HON f acilities. June 1, 2006. Docket No.

EPA

- HQ

- OAR

- 2005

- 0475

- 0105.

12 Assuming VOC as a surrogate for HAP, because all HAP present (i.e., TDI) are VOC. See Reference 10

. 13 Chemical Engineering Magazine. Economic Indicators. Chemic al Engineering Plant Cost Index. CE Index for

2005 is 468.2.

14 No cost basis for these values was presented in the background information. Therefore, it was assumed that these costs were presented in 2005 dollars.15 were assumed to be 100 percent of the nationwide baseline emissions and w ere estimated to be 1
tpy, with an estimated cost effectiveness of $ 305 ,000/ton HAP reduction. This analysis is presented in Table 6

.

Table 6

. Flexible Polyurethane Foam Equipment Cost and Cost Effectiveness Calculations

for “Low

- Leak” Packing

Source

Cat egory Nationwide

HAP

Emissions

from Valves (tpy) 1 Nationwide

Annual

Cost 2 #

Facilities 3 Annual

Cost/ Facility Nationwide Capital

Cost 2 Capital

Cost/ Facility Cost

Effec tiveness ($/T on reduced) 4

FPUF

Production 1.01 $309,197 7 $44,171 $2,259,514 $322,788 $304,922

1 Represents baseline emissions, value based on calculation of potential VOC emissions per valve. Actual VOC and HAP emissions are for the FPUF source category are likely even lower than this assumption, considering the reported emissions in the EPA’s Nation al Emissions Inventory for the facilities in this source category.

2 Based on total capital cost of $ 5.7 billion, total annual cost of $780 million, and HAP emission reduction of 3,200, reported in the National Emission Standards for Hazardous Air Pollutan ts for Organic Hazardous Air Pollutants From the Synthetic Organic Chemical Manufacturing Industry: Proposed Rule. 71 FR 34422, June 14,

2006. Also considers a 2005 CE Index of 468.2 and a 2011 CE index of 585.7.

3 Number of facilities represents slabstock facilities only.

4 Emission reductions assumed to be 100 percent of baseline emissions

.

4. 3 .3 Repair Schedule for Diisocyanate Equipment Leaks

As noted in S ection 3. 3 and further above in section 4.4.2 , t he EPA considered the results of the technolog y reviews for t he P&R IV, PAI , and PEPO source categories and the public comments received on the proposed RTR action for those source categories

. One of the comments the EPA received on this proposed RTR action was that the EPA should also consider severa l additional improvements in LDAR programs that the EPA did not identify in this technology review. As part of the technology review for the FPUF Production source category, these suggestions were also considered for application to the FPUF Production MACT standard. One potenti ally applicable suggestion was that an LDAR program including tighter leak repair timelines be implemented, which some rules implemented by the California Bay Area Air Quality Management District (BAAQMD) and the California South Coast Air Quality Manageme nt
District (SCAQMD) require

. The FPUF Production MACT includes provisions regulating delay of repair for equipment leaks, but contains no limitation on the number of components awaiting repair.

The BAAQMD Regulation 8, Rule 18 limits the number of equipment compon ents awaiting repairs to 0.3 percent for valves, 0.025 percent for valves with major leaks ( i.e.

, leaks greater than 10,000 ppm, including methane) and 1.0 percent for pumps and compressors. The BAAQMD also requires mass emission testing for non

- repairable components with high leak rates and places an emission limit of 15 lbs/day on non

- repairable components. The SCAQMD

Rule 1173 limits the number of component awaiting repairs to 0.5 percent for valves and 1.0 percent for pump s.16 Background data for propos ed amendments to BAAQMD Regulation 8 Rule 18 provides

incremental costs associated with its amendment that lowers the number of components awaiting repairs from 0.5 percent to 0.3 percent for valves (no change was implemented for pumps, compressors, and pr essure relief devices). 15 The BAAQMD analysis was conducted for 233,000 valves at five refineries (average of 46,600 valves per facility) located in the Bay Area District. Lowering the allowable percent of valves awaiting repairs from 0.5 to 0.3 percent was predicted to reduce emissions by 74 tpy (or by 57.1 percent). According to their analysis, BAAQMD estimated that an incremental total annualized cost associated with their amendment ranged from $34,200 to $173,000/yr per facility. 16 These costs include the annual costs related to conducting mass emission rate determinations and cost to capture and control valves with excessive leaks.

The BAAQMD estimated that mass emission rate determinations would apply to 60 valves per facility (or about 0.13 percent of the average number of valves at a facility). The BAAQMD estimated that the annualized cost of conducting the mass emission rate determinations would be range from $19,700 to $115,000/yr, 17 and the midpoint of the range is $67,100/yr or $1,120/yr/valve. Of these 60 valves, the BAAQMD assumed that about 2.5 percent would require control

, or 2 valves per facility. The BAAQMD estimated that the annual cost of controlling these valves would range from $14,600 to $58,300/yr per facility, 18 with a midpoint of $36, 400 per year or $18,200/yr/valve.

T he BAAQMD approach was applied to a model plant for the FPUF Production source category. 19 The results of this analysis are presented in Table 7 . As shown in Table 7 , the

annualized cost associated with mass emission rate determina tions for the FPUF Production source category was estimated to be $1,120/yr and the annualized cost associated with control of

valves with excessive leaks for the FPUF p roduction model plant was estimated to be $18,200/yr. The cost effectiveness for the FPUF p roduction model plant was est imated to be $234,000 per ton of HAP.

15 Douglas, Victor, Compliance and Enforcem ent Division, BAAQMD. Draft Staff Report: Proposed Amendments Regulation 8 Rule 18: Equipment Leaks Control Measure SS

- 16. December 2003. See Attachment 4

. 16 BAAQMD Costs were assumed to be in 2003 dollars. Costs escalated to 2011 dollars. CE Index for 200 3 is 402

and for 2011 is 585.7. See Reference 13 2.

17 See Reference 12.

18 See Reference 15

. 19 Based on Model Plant 3 as identified in the 6/17/1996 memorandum: “Estimated Regulatory Alternative Imp acts for Flexible Polyurethane Foam Production "

.Table 7

. Flexible Polyurethane Foam Production Equipment Cost & Cost Effectiveness Calculations for BAAQMD Repair Schedule

Number of

Valves 1 ,2 Uncontrolled

Emissions (tpy) Controlled

Emissions (tpy) Emissions

Reductions (tpy) Emission

Reduction (%) Emission Reduction per

Valve (T on/valve/yr) Number of

Valves Requiring

Mass

Measurements 2 Percent of

Valves

R equiring

Mass

Measurement (%) BAAQMD 46,600 26 11 14.7 57.1% 0.000316 60 0.129

FPUF

Production (slabstock diisocyanates) 32 0.1 45 .0622 0.08 57.1% 0.002584 1 3.125

Annual Cost

of Mass

Measurement ($/yr) 3,4 Annual Cost

of Mass

Measurement per Valve ($/yr/valve) Number of

Valves

with

Excessive Leaking Percent of

Valves with

Excessive Leaking (%) Annual Cost

of Excessive

Leak

Contr ol ($/yr) 5 Annual Cost

of Excessive

Leak Control

per Valve ($/yr/valve) Cost

Effectiveness ($/T on)

BAAQMD $ 67,093 $ 1,118 2 3.33 $ 36,424 $ 18,212 $7,037

FPUF

Production (slabstock diisocyanates) $ 1,118

-- 1 100.00 $ 18,212

-- $233,770

1 Number of component s based on Model Plant 3 as identified in the 6/17/1996 memorandum: "Flexible Polyurethane Foam Model Plants.", available as part of “Hazardous Air Pollutant Emissions From The Production Of Flexible Polyurethane Foam: Supplementary Information Document F or Proposed Standards” Emission Standards Division, U.S. EPA, September 1996

. 2 Rounded up to the nearest whole number of valves

. 3 Costs presented in Douglas, Victor, Compliance and Enforcement Division, BAAQMD. Draft Staff Report: Proposed Amendments R egulation 8 Rule 18: Equipment Leaks

Control Measure SS

- 16. December 2003 were escalated to 2011 dollars. 2003 CE Index: 402, 2011 CE Index 585.7. See Attachment 4.

4 Calculated by dividing the annualized cost of mass emission determination from the BAAQMD cost estimate ($67,100/yr) by the number of valves in the BAAQMD estimate (60 valves), resulting in an average annualized cost per valve of $1,120/yr. This value was then applied to the FPUF production model plant.

5 Calculated by dividing the annualized cost of co ntrol of valves with excessive leaks ($36,400/yr) by the number of valves (60 valves) from the BAAQMD estimate, resulting in an average annualized cost per valve of $18,200/yr. This number was then multiplied by the number of valves in the model plan t.