EPA 905/5-78-001
January 1979 C.
ECONOMIC IMPACT OF
IMPLEMENTING RACT
GUIDELINES IN THE
STATE OF ILLINOIS
U.S. ENVIRONMENTAL PROTECTION AGENCY
Region V
Air Programs Branch
Air & Hazardous Materials Division
230 South Dearborn
Chicago, Illinois 60604
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EPA 905/5-78-001
FINAL REPORT
ECONOMIC IMPACT OF IMPLEMENTING RACT
GUIDELINES IN THE STATE OF
ILLINOIS
Task Order Number 3 Under:
Basic Ordering Agreement Number 68-02-2544
RESEARCH AND DEVELOPMENT SERVICES FOR ASSISTANCE
TO STATES AND EPA CARRYING OUT REQUIREMENTS
OF CLEAN AIR ACT AND APPLICABLE FEDERAL
AND STATE REGULATIONS
Prepared for:
oEPA
U.S. ENVIRONMENTAL PROTECTION AGENCY
REGION V
AIR & HAZARDOUS MATERIALS DIVISION
CHICAGO, ILLINOIS 60604
EPA Project Officer: Rizalino Castanares
From:
BOOZ, ALLEN & HAMILTON Inc.
January, 1979
BOOZ:
I ALIEN
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This air pollution report is issued by Region V of the
U.S. Environmental Protection Agency (EPA), to assist state an
local air pollution control agencies in carrying out their
program activities. Copies of this report may be obtained, fo,
a nominal cost, from the National Technical Information Service
5285 Port Royal Road, Springfield, Virginia 22151.
This report was furnished to the EPA by Booz, Allen £
Hamilton Inc. in fulfillment of Task Order Number 3 of Basic
Ordering Agreement Number 68-02-2544. This report has been
reviewed by EPA Region V and approved for publication. Approve'.
does not signify that the contents necessarily reflect the views
and policies of the EPA, nor does mention of trade names or
commercial products constitute endorsement or recommendation
for use.
il
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TABLE OF CONTENTS
CHAPTER TITLE
1. 0 EXECUTIVE SUMMARY
2. 0 INTRODUCTION AND OVERALL
STUDY APPROACH
3.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR MANUFACTURING PLANTS
IN THE STATE OF ILLINOIS
4.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES TO THE SURFACE
COATING OF COILS IN THE STATE
OF ILLINOIS
5.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
PAPER IN THE STATE OF ILLINOIS
6.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
FABRICS IN THE STATE OF ILLINOIS
7.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE
COATING OF AUTOMOBILES IN THE
STATE OF ILLINOIS
8.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR SURFACE COATING OF METAI
FURNITURE IN THE STATE OF ILLINOI
9.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE
COATING FOR INSULATION OF MAGNET
WIRES IN THE STATE OF ILLINOIS
10.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE
COATING OF LARGE APPLIANCES
IN THE STATE OF ILLINOIS
11.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR SOLVENT METAL CLEANING
(DECREASING) IN THE STATE OF
ILLINOIS
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TABLE OF CONTENTS
CHAPTER TITLE
12.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR CONTROL OF REFINERY
VACUUM PRODUCING SYSTEMS, WASTE-
WATER SEPARATORS AND PROCESS UNI1
TURNAROUNDS IN THE STATE OF ILLIN
13.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR TANK TRUCK GASOLINE LOAD
TERMINALS IN THE STATE OF ILLINOI
14.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR BULK GASOLINE PLANTS IN
THE STATE OF ILLINOIS
15.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR STORAGE OF PETROLEUM
LIQUIDS IN FIXED-ROOF TANKS IN
THE STATE OF ILLINOIS
16.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT STAGE I FOR GASOLINE SERVICE
STATIONS IN THE STATE OF ILLINOIS
17.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR USE OF CUTBACK ASPHALT
IN THE STATE OF ILLINOIS
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LIST OF EXHIBITS
Exhibit Following Page
1-1 LISTING OF EMISSION LIMITATIONS THAT
REPRESENT THE PRESUMPTIVE NORM TO BE
ACHIEVED THROUGH APPLICATION OF RACT
FOR FIFTEEN INDUSTRY CATEGORIES 1-6
1-2 SUMMARY OF IMPACT OF IMPLEMENTING RACT
GUIDELINES IN 15 INDUSTRIAL CATEGORIES
—ILLINOIS 1-7
1-3 ESTIMATED CHANGE IN ENERGY DEMAND
RESULTING FROM IMPLEMENTATION OF RACT
GUIDELINES IN ILLINOIS 1-11
1-4 - SUMMARY EXHIBITS OF THE FIFTEEN RACT
1-18 CATEGORIES 1-20
2-1 LISTING OF EMISSION LIMITATIONS THAT
REPRESENT THE PRESUMPTIVE NORM TO BE
ACHIEVED THROUGH APPLICATION OF RACT
FOR FIFTEEN INDUSTRY CATEGORIES 2-5
3-1 DATA QUALITY 3-5
3-2 LIST OF METAL CAN MANUFACTURING
FACILITIES POTENTIALLY AFFECTED BY
RACT IN ILLINOIS 3-6
3-3 SHEET BASE COATING OPERATION 3-9
3-4 SHEET PRINTING OPERATION 3-9
3-5 CAN END, AND THREE-PIECE BEER AND
BEVERAGE CAN FABRICATING OPERATION 3-10
3-6 TWO-PIECE ALUMINUM CAN FABRICATING
AND COATING OPERATION 3-11
3-7 EMISSIONS FOR TYPICAL COATING OPERATION
USED IN THE MANUFACTURE OF TWO-PIECE CANS 3-12
3-8 COATING AND PRINTING OPERATIONS USED IN
THE MANUFACTURE OF THREE-PIECE CANS
(Sheet Coating Operation) 3-12
3-9 EMISSIONS OF TYPICAL COATING OPERATIONS
USED IN THREE-PIECE CAN ASSEMBLY 3-12
V
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Exhibit Following Page
3-10 ILLINOIS EMISSION INVENTORY 3-13
3-11 RACT GUIDELINES FOR CAN COATING OPERATIONS 3-14
3-12 PERCENTAGE OF CANS MANUFACTURED USING
EACH ALTERNATIVE 3-14
3-13 EMISSIONS FROM COATING TWO-PIECE ALUMINUM
BEER AND SOFT DRINK CANS 3-22
3-14 EMISSIONS FROM COATING THREE-PIECE CANS 3-22
3-15 COST OF IMPLEMENTING RACT ALTERNATIVES
FOR REPRESENTATIVE CAN MANUFACTURING
PLANTS ($1,000) 3-24
3-16 COST OF COMPLIANCE TO RACT FOR THE CAN
MANUFACTURING INDUSTRY IN ILLINOIS 3-25
3-17 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR CAN MANUFACTURING
PLANTS IN THE STATE OF ILLINOIS 3-28
4-1 SURFACE COATING OF COILS DATA QUALITY 4-4
4-2 DIAGRAM OF A COIL COATING LINE 4-6
4-3 TYPICAL REVERSE ROLL COATER 4-6
4-4 ESTIMATED TONNAGE OF METAL COATED IN THE
U.S. IN 1977 WITH COIL COATING TECHNIQUES 4-8
4-5 SUMMARY OF EMISSION CONTROL COSTS 4-9
4-6 COIL COATING OPERATIONS IN ILLINOIS 4-10
4-7 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR COIL COATING
FACILITIES IN THE STATE OF ILLINOIS 4-11
5-1 DATA QUALITY—SURFACE COATING OF PAPER 5-5
5-2 1976 INDUSTRY STATISTICS—SURFACE COATING
OF PAPER SIC GROUPS IN ILLINOIS 5-6
5-3 HISTORICAL TRENDS IN VALUE OF SHIPMENTS
OF U.S. PLANTS ENGAGED IN PAPER COATING
($ millions) 5-7
5-4 EMISSION DATA FROM TYPICAL PAPER
COATING PLANTS 5-9
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Exhibit Following Page
5-5 TYPICAL PAPER COATING LINE 5-10
5-6 KNIFE COATER 5-10
5-7 REVERSE ROLL COATER 5-11
5-8 PLANTS EXPECTED TO BE AFFECTED BY PAPER
COATINGS RACT REGULATIONS IN ILLINOIS 5-12
5-9 ACHIEVABLE SOLVENT REDUCTIONS USING LOW
SOLVENT COATINGS IN PAPER COATING INDUSTRY 5-13
5-10 INCINERATION COSTS FOR A TYPICAL PAPER
COATING OPERATION 5-19
5-11 CARBON ADSORPTION COSTS FOR PAPER
COATING INDUSTRY 5-19
5-12 SUMMARY OF ASSUMPTIONS USED IN COST
ESTIMATE 5-21
5-13 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR PAPER COATERS
IN THE STATE OF ILLINOIS 5-25
6-1 DATA QUALITY—SURFACE COATING OF FABRICS 6-5
6-2 INDUSTRY STATISTICS FOR PLANTS IN SIC
CATEGORIES WHERE FABRIC COATING MAY BE
USED IN ILLINOIS 6-6
6-3 FIRMS EXPECTED TO BE AFFECTED BY THE
FABRIC COATING RACT REGULATIONS IN
ILLINOIS 6-6
6-4 U.S. ANNUAL VALUE OF SHIPMENTS OF COATED
FABRICS ($ millions) 6-6
6-5 U.S. ANNUAL SHIPMENTS OF BACKING MATERIALS
FOR COATED FABRICS (in millions of
pounds) 6-6
6-6 TYPICAL FABRIC COATING OPERATION 6-8
6-7 KNIFE COATING OF FABRIC 6-11
6-8 ROLLER COATING OF FABRIC 6-11
6-9 CAPITAL COST FOR DIRECT FLAME AND
CATALYTIC INCINERATORS WITH HEAT
EXCHANGE 6-18
VI Jk
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Exhibit Following Page
6-10 ANNUAL COST OF DIRECT FLAME INCINERATOR
WITH PRIMARY HEAT RECOVERY AT300°F 6-18
6-11 SUMMARY OF ASSUMPTIONS USED IN COST
ESTIMATE 6-18
6-12 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR FABRIC COATERS
IN THE STATE OF ILLINOIS 6-21
7-1 SURFACE COATING OF AUTOMOBILES DATA
QUALITY 7-4
7-2 LIST OF POTENTIALLY AFFECTED FACILITIES
BY THE RACT GUIDELINE FOR SURFACE
COATING OF AUTOMOBILES—ILLINOIS 7-5
7-3 ILLINOIS EMISSIONS-SURFACE COATING OF
AUTOMOBILES 7-10
7-4 SELECTION OF THE MOST LIKELY RACT
ALTERNATIVES UNDER SCENARIO I (RACT
COMPLIANCE BY 1982) 7-14
7-5 SELECTION OF THE LIKELY RACT ALTERNATIVES
UNDER SCENARIO II 7-14
7-6 ESTIMATED COST FOR MODEL PLANT TO MEET
AUTOMOBILE RACT REQUIREMENTS 7-18
7-7 STATEWIDE COSTS TO MEET THE RACT GUIDELINES
FOR AUTOMOBILE ASSEMBLY PLANTS 7-18
7-8 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT SCENARIO I FOR AUTOMOBILE
ASSEMBLY PLANTS IN THE STATE OF ILLINOIS 7-23
7-9 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT SCENARIO II FOR THE AUTO-
MOBILE ASSEMBLY PLANTS IN THE STATE OF
ILLINOIS 7-23
8-1 SURFACE COATING OF METAL FURNITURE
DATA QUALITY 8-6
8-2 LIST OF MANUFACTURERS POTENTIALLY AFFEC-
TED BY RACT GUIDELINES FOR SUFACE COATING
OF METAL FURNITURE IN ILLINOIS 8-7
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Exhibit Following Page
8-3 COMMON TECHNIQUES USED IN COATING OF
METAL FURNITURE PIECES 8-9
8-4 SUMMARY OF HYDROCARBON EMISSIONS FROM
METAL FURNITURE MANUFACTURING FACILITIES
IN ILLINOIS 8-10
8-5 EMISSION LIMITATIONS FOR RACT IN SURFACE
COATING OF METAL FURNITURE 8-10
8-6 RACT CONTROL OPTIONS FOR THE METAL
FURNITURE INDUSTRY 8-10
8-7 ESTIMATED COST OF CONTROL FOR MODEL
EXISTING ELECTROSTATIC SPRAY COATING LINES 8-12
8-8 ESTIMATED COST OF CONTROL OPTIONS FOR
MODEL EXISTING DIP COATING LINES 8-13
8-9 STATEWIDE COSTS FOR PROCESS MODIFICATIONS
OF EXISTING METAL FURNITURE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION
CONTROL 8-13
8-10 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR SURFACE COATING
OF METAL FURNITURE IN THE STATE OF
ILLINOIS 8-18
9-1 MAGNET WIRE COATERS IN THE STATE OF
ILLINOIS 9-1
9-2 EMISSION LIMITATIONS FOR RACT IN THE
SURFACE COATING FOR INSULATION OF MAGNET
WIRE 9-1
9-3 SUMMARY OF APPLICABLE CONTROL TECHNOLOGY
FOR CONTROL OF ORGANIC EMISSION FROM THE
SURFACE COATING FOR INSULATION OF MAGNET
WIRE 9-1
9-4 RACT CONTROL OPTIONS FOR THE SURFACE
COATING FOR INSULATION OF MAGNET WIRE 9-1
9-5 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR SURFACE COATING
FOR INSULATION OF MAGNETIC WIRE IN THE
STATE OF ILLINOIS 9-1
10-1 SURFACE COATING OF LARGE APPLIANCES
DATA QUALITY 10-5
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Exhibit Following Page
10-2 LIST OF MANUFACTURERS POTENTIALLY
AFFECTED BY RACT GUIDELINES WHO SURFACE
COAT LARGE APPLIANCES IN ILLINOIS 10-6
10-3 INDUSTRY STATISTICS—SURFACE COATING OF
LARGE APPLIANCES ILLINOIS 10-6
10-4 COMPARISON OF LARGE APPLIANCE STATISTICS
WITH STATE OF ILLINOIS ECONOMIC DATA 10-6
10-5 HISTORICAL U.S. SALES FIGURES—SELECTED
MAJOR HOUSEHOLD APPLIANCES FOR 1968-
1977 10-7
10-6 FIVE-YEAR U.S. SALES FORECAST FOR
SELECTED MAJOR HOUSEHOLD APPLIANCES
(1978-1982) 10-7
10-7 PRESENT MANUFACTURING TECHNOLOGY
DESCRIPTION 10-8
10-8 DIAGRAM OF A LARGE APPLIANCE COATING LINE 10-8
10-9 RACT DATA SUMMARY FOR ESTIMATED VOC
EMISSIONS FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF ILLINOIS 10-9
10-10 EMISSION LIMITATIONS FOR RACT IN THE
SURFACE COATING OF LARGE APPLIANCES 10-9
10-11 SUMMARY OF APPLICABLE CONTROL TECHNOLOGY
FOR COATING OF LARGE APPLIANCE DOORS, LIDS,
PANELS, CASES AND INTERIOR PARTS 10-9
10-12 RACT CONTROL OPTIONS FOR THE LARGE
APPLIANCE INDUSTRY 10-9
10-13 MOST LIKELY RACT CONTROL ALTERNATIVES FOR
SURFACE COATING OF LARGE APPLIANCES IN
STATE OF ILLINOIS 10-10
10-14 ESTIMATED COST FOR PROCESS MODIFICATION
OF EXISTING LARGE APPLIANCE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION
CONTROL 10-11
10-15 STATEWIDE COSTS FOR PROCESS MODIFICATIONS
OF EXISTING LARGE APPLIANCE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION
CONTROL ILLINOIS 10-12
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Exhibit Following Page
10-16 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR SURFACE COATING
OF LARGE APPLIANCES IN THE STATE OF
ILLINOIS 10-16
11-1 DATA QUALITY 11-10
11-2 ESTIMATED NUMBER OF VAPOR DEGREASERS
IN ILLINOIS 11-11
11-3 ESTIMATED NUMBERS OF COLD CLEANERS IN
ILLINOIS 11-11
11-4 ESTIMATE OF AFFECTED SOLVENT METAL
CLEANERS IN ILLINOIS 11-11
11-5 SOLVENTS CONVENTIONALLY USED IN SOLVENT
METAL DECREASING 11-12
11-6 CONTROL SYSTEMS FOR COLD CLEANING 11-16
11-7 EPA PROPOSED CONTROL SYSTEMS FOR OPEN
TOP VAPOR DEGREASERS 11-16
11-8 EPA PROPOSED CONTROL SYSTEMS FOR
CONVEYORIZED DEGREASERS 11-16
11-9 AVERAGE UNIT EMISSION RATES AND EXPECTED
EMISSION REDUCTIONS 11-19
11-10 ESTIMATED CURRENT AND REDUCED EMISSIONS
FROM SOLVENT METAL CLEANING IN ILLINOIS 11-19
11-11 CONTROL COSTS FOR COLD CLEANER WITH
5.25 FT.2 AREA 11-20
11-12 CONTROL COSTS FOR AVERAGE-SIZED OPEN TOP
VAPOR AND CONVEYORIZED CLEANERS 11-20
11-13 ESTIMATED CONTROL COSTS FOR COLD CLEANERS
FOR THE STATE OF ILLINOIS 11-20
11-14 ESTIMATED CONTROL COSTS FOR OPEN TOP
VAPOR DEGREASERS FOR THE STATE OF
ILLINOIS 11-20
11-15 ESTIMATED CONTROL COSTS FOR CONVEYORIZED
DEGREASERS FOR THE STATE OF ILLINOIS 11-20
11-16 ESTIMATED NUMBER OF COLD CLEANERS NEEDING
CONTROLS IN THE STATE OF ILLINOIS 11-20
XI
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Exhibit Following Page
11-17 ESTIMATED NUMBER OF OPEN TOP VAPOR
DEGREASERS NEEDING CONTROL IN THE STATE
OF ILLINOIS 11-20
11-18 ESTIMATED NUMBER OF CONVEYORIZED DEGREASERS
NEEDING CONTROLS IN THE STATE OF ILLINOIS 11-20
11-19 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SOLVENT METAL
DECREASING IN THE STATE OF ILLINOIS 11-23
12-1 DATA QUALITY 12-5
12-2 PETROLEUM REFINERIES IN ILLINOIS 12-6
12-3 INDUSTRY STATISTICS FOR REFINERIES IN
ILLINOIS 12-6
12-4 VACUUM PRODUCING SYSTEM UTILIZING A TWO-
STAGE CONTACT CONDENSER 12-9
12-5 VACUUM PRODUCING SYSTEM UTILIZING BOOSTER
EJECTOR FOR LOW VACUUM SYSTEMS 12-9
12-6 ESTIMATED HYDROCARBON EMISSIONS FROM
SELECTED REFINERY OPERATIONS IN ILLINOIS 12-10
12-7 INSTALLED CAPITAL COSTS OF VAPOR CONTROL
SYSTEMS FOR VACUUM PRODUCING SYSTEMS,
WASTEWATER SEPARATORS AND PROCESS UNIT
TURNAROUNDS 12-14
12-8 STATEWIDE COSTS FOR VAPOR CONTROL SYSTEMS
FOR REFINERY WASTEWATER SEPARATORS 12-15
12-9 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR REFINERY VACUUM
PRODUCING SYSTEMS, WASTEWATER SEPARATORS
AND PROCESS UNIT TURNAROUNDS IN THE STATE
OF ILLINOIS 12-18
13-1 DATA QUALITY 13-5
13-2 INDUSTRY STATISTICS FOR BULK TERMINALS IN
ILLINOIS 13-6
13-3 GASOLINE DISTRIBUTION NETWORK 13-6
13-4 DISTRIBUTION OF TANK TRUCK GASOLINE
LOADING TERMINALS BY AMOUNT OF THROUGHPUT
IN THE UNITED STATES 13-7
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Exhibit Following Page
13-5 VOC EMISSIONS FROM TANK TRUCK GASOLINE
LOADING TERMINALS IN ILLINOIS 13-9
13-6 VOC EMISSION CONTROL TECHNOLOGY FOR TANK
TRUCK GASOLINE' LOADING TERMINALS 13-10
13-7 FACTORY COSTS OF ALTERNATIVE VAPOR
CONTROL SYSTEMS 13-13
13-8 DESCRIPTION AND COST OF MODEL TANK TRUCK
GASOLINE LOADING TERMINALS EQUIPPED WITH
VAPOR CONTROL SYSTEMS 13-13
13-9 STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
FOR TANK TRUCK GASOLINE LOADING TERMINALS 13-14
13-10 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR TANK TRUCK
GASOLINE LOADING TERMINALS IN ILLINOIS 13-18
14-1 DATA QUALITY 14-5
14-2 INDUSTRY STATISTICS FOR BULK GASOLINE
PLANTS IN ILLINOIS 14-6
14-3 GASOLINE DISTRIBUTION NETWORK 14-6
14-4 DISTRIBUTION OF BULK GASOLINE
PLANTS BY AMOUNT OF THROUGHPUT 14-7
14-5 VOC EMISSIONS FROM BULK GASOLINE PLANTS
IN ILLINOIS 14-9
14-6 VOC EMISSION CONTROL TECHNOLOGY FOR BULK
GASOLINE PLANTS 14-10
14-7 ALTERNATIVE CONTROL METHODS FOR VAPOR
CONTROL AT BULK GASOLINE PLANTS 14-11
14-8 COSTS OF ALTERNATIVE VAPOR CONTROL
SYSTEMS 14-13
14-9 DESCRIPTION AND COST OF MODEL BULK PLANTS
EQUIPPED WITH VAPOR CONTROL SYSTEMS 14-14
14-10 STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
FOR BULK GASOLINE PLANTS 14-15
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Exhibit Following Pag<
14-11 STATEWIDE COSTS OF VAPOR CONTROL SYSTEM
BY SIZE OF BULK GASOLINE PLANT 14-15
14-12 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR BULK GASOLINE PLANTS
IN ILLINOIS 14-21
16-1 DATA QUALITY 16-4
16-2 INDUSTRY STATISTICS FOR GASOLINE
SERVICE STATIONS IN ILLINOIS 16-5
16-3 GASOLINE DISTRIBUTION NETWORK 16-6
16-4 CLASSIFICATION OF SERVICE STATIONS 16-6
16-5 GEOGRAPHIC DISTRIBUTION OF GASOLINE
THROUGHOUT ILLINOIS 16-6
16-6 VOC EMISSIONS FROM GASOLINE IN SERVICE
STATIONS 16-10
16-7 VOC EMISSION CONTROL TECHNOLOGY FOR
GASOLINE SERVICE STATIONS 16-11
16-8 STAGE I VAPOR CONTROL SYSTEM - VAPOR
BALANCING WITH SEPARATE LIQUID-VAPOR
RISERS 16-11
16-9 STAGE I VAPOR CONTROL SYSTEM - VAPOR
BALANCING WITH CONCENTRIC LIQUID-VAPOR
RISERS 16-11
16-10 STAGE I VAPOR CONTROL COSTS FOR A
TYPICAL GASOLINE DISPENSING FACILITY 16-14
16-11 STATEWIDE COSTS FOR STAGE I VAPOR
CONTROL OF GASOLINE SERVICE STATIONS 16-15
16-12 STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
BY SIZE OF GASOLINE DISPENSING FACILITY
IN ILLINOIS 16-15
16-13 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR GASOLINE
SERVICE STATIONS IN THE STATE OF ILLINOIS 16-15
17-1 DATA QUALITY 17-4
17-2 PETROLEUM ASPHALT FLOW CHART 17-5
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Exhibit Following Page
17-3 HISTORICAL NATIONAL SALES OF ASPHALT
CEMENT, CUTBACK ASPHALT AND ASPHALT
EMULSIONS 17-6
17-4 ESTIMATED HYDROCARBON EMISSIONS FROM THE
USE OF CUTBACK ASPHALT IN ILLINOIS 17-11
17-5 STATEWIDE COSTS FOR RACT FOR USE OF
CUTBACK ASPHALT 17-13
17-6 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTATING RACT FOR USE OF CUTBACK
ASPHALT IN THE STATE OF ILLINOIS 17-15
LIST OF FIGURES
Figure Following Page
11-1 SPRAY CLEANING EQUIPMENT 11-13
11-2 OPEN TOP DEGREASER 11-14
11-3 CROSS-ROD CONVEYORIZED DEGREASER 11-15
XV
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1. EXECUTIVE SUMMARY
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1. EXECUTIVE SUMMARY
This chapter summarizes the major elements and most
significant findings of the study to determine the economic
impact of implementing Reasonably Available Control Tech-
nology (RACT) guidelines for volatile organic compounds in
the State of Illinois. Further discussion and data are
presented in detail in the subsequent chapters of the report,
This Executive Summary is divided into three sections:
Objectives, Scope and Approach
Statewide Aggregate Economic Impact
for the 15 RACT Guidelines
Economic Implications of Each RACT
Guideline.
1-1
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1.1 OBJECTIVES, SCOPE AND
APPROACH
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1.1 OBJECTIVES, SCOPE AND APPROACH
The Clean Air Act Amendments of 1977 required the states
to revise their State Implementation Plans (SIPs) to provide
for the attainment and maintenance of national ambient air
quality standards in areas designated as nonattainment. The
Amendments require that each state submit the SIP revisions
to the U.S. Environmental Protection Agency (EPA) by January
1, 1979. These proposed regulations should contain an oxidant
plan submission for major urban areas to reflect the applica-
tion of Reasonably Available Control Technology (RACT) to
stationary sources for which the EPA has published guidelines.
The Amendments also require that the states identify and analyze
the air quality, health, welfare, economic, energy and social
effects of the plan provisions.
1.1.1 Objectives
The major objective of the contract effort was to
determine the direct economic impact of implementing RACT
standards for industrial categories in four states (Illinois,
Wisconsin, Ohio and Michigan) of Region V of the U.S. Environ-
mental Protection Agency. These studies will be used primarily
to assist EPA and state decisions on achieving the emission
limitations of the RACT standards.
1.1.2 Scope
The scope of this project was to determine the costs
and direct impacts of control to achieve RACT guidelines
limitations. The impact was addressed for each industry
and for each state so that the respective studies are ap-
plicable to individual state regulations. Direct economic
costs and benefits from the implementation of the/RACT
guidelines were identified and quantified. While secondary
(social, energy, employment, etc.) impacts were addressed,
they were not a major emphasis in the study. In summary,
direct economic impact analysis of each industrial category
was aggregated on a statewide basis for the RACT categories
studied.
In Illinois, the economic impact was
assessed for the following fifteen RACT
industrial categories:
Surface coating of cans
Surface coating of coils
Surface coating of paper
Surface coating of fabrics
1-2
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Surface coating of automobiles and
light duty trucks
Surface coating of metal furniture
Surface coating for insulation of
magnet wire
Surface coating of large appliances
Solvent metal cleaning
Bulk gasoline, terminals
Refinery vacuum producing systems,
wastewater separators and process
unit turnarounds
Bulk gasoline plants
Storage of petroleum liquids in
fixed roof tanks
Service stations—Stage I
Use of cutback asphalt.
In the determination of the economic impact of the RACT
limitations, the following are the major study guidelines:
The emission limitations for each
industrial category were studied at
the control level established by the
RACT guidelines. These are presented
in Exhibit 1-1, at the end of this
section. (In addition an alternative
scenario for the surface coating of
automobiles is presented in this report.)
The timing requirement for implementation
of controls to meet RACT emission limita-
tions was January 1, 1982.
All costs and emission data were presented
for 1977.
Emission sources included were existing
stationary point sources in most of the
applicable industrial categories with
VOC emissions greater than 3 pounds in any
hour or 15 pounds in any day.-'-
1 For some industrial categories (such as solvent metal cleaning
and fixed roof tanks), size characteristics are used as the
basis for inclusion, rather than emissions.
1-3
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The following volatile organic compounds
were exempted:
Methane
- Ethane
Trichlorotrifluorethane
1,1,1-trichloroethane (methyl
chloroform).!
The cost of compliance was determined from the
current level of control (i.e., if an affected
facility already had control in place, the cost
of compliance and the resulting VOC emissions
reduction are not included in this analysis).
1.1.3 Approach
The approach applied to the overall study was: a study
team with technology and economic backgrounds utilized available
secondary sources to estimate the emissions, statistics and
costs for each RACT industrial category; then, the study team
completed, calibrated and refined these estimates based on
approximately 60 interviews with a cross-section of industry
representatives in the four states. Because of the number of
point sources and the data available in the state emission
inventory, the methodology was specific for each RACT industrial
category studied. However, the general methodology applied
for two major classes of industrial categories was:
Surface coating RACT industrial categories
(cans, coils, fabrics, paper, automobiles and
light duty trucks, metal furniture, magnet wire
and large appliances)—The potentially
affected facilities, emissions and emission
characteristics were obtained primarily from
the state emission inventory. Therefore, the
following generalized methodology was applied:
A list of potentially affected
facilities was compiled from
secondary reference sources.
Data from the emission inventory
were categorized and compiled for
each RACT industrial category.
Firms not listed in the emission
inventory were identified. A
sampling of these facilities were
then interviewed by telephone when
there was doubt concerning their
inclusion.
The exemption status of methyl chloroform under these
guidelines may be subject to change.
1-4
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- Emissions, emission characteristics,
control options and control costs
were studied for relevant firms.
Interviews were conducted to determine
applicable control options and potential
control costs.
The study team then evaluated the con-
trol cost to meet the RACT requirements
and the potential emission reduction.
Nonsurface coating RACT industrial categories (bulk
gasoline plants, bulk gasoline terminals and refin-
eries, service stations, fixed roof tanks and sol-
vent metal cleaning)—Each category either represented
an exhaustive list of potentially affected facilities
or emissions data were not available (or categorized)
for these types of sources. Therefore, the following
generalized methodology was applied:
- Industry statistical data were collected
from secondary reference sources.
Statewide emissions were estimated by
applying relevant factors (e.g., emissions
per facility or throughput).
Control options and estimated costs to
meet the RACT guidelines were reviewed.
- Interviews were conducted to determine
applicable associated control options
and the cost of control.
1.1.4 Quality of Estimates
The quality of the estimates that are presented in this
report can be judged by evaluating the basis for estimates
of the individual study components. In each of the chapters
that deal with the development of estimated compliance cost,
the sources of information are fully documented.
In the determination of the economic impact for each
industrial category studied, the estimated compliance cost
is subject to variations due to inherent variations in
procedures for estimating:
Engineering costs
The number of sources affected.
1-5
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Engineering cost estimates, when performed for an individual
modification with specific equipment sized at the desired capacity,
are typically subject to variations of 25 percent. When engineering
cost estimates are performed on technologies not commercially
proven for a specific facility, the variations are -much greater,
many times over 100 percent.
Many of the RACT categories studied (such as solvent metal
cleaning) represent an exhaustive list of potentially affected
facilities that have not been previously identified or categorized.
Therefore, the actual number of facilities affected by a given
RACT industrial category had to be estimated from available data
sources.
If a study with unlimited resources were performed, to
estimate the specific cost to each individual facility affected
within the state, the study would be subject to a 25 percent to
50 percent variation because of the inherent variability of
engineering estimates and the uncertainty involved in the selection
and demonstrated capabilities of the control alternatives. Further-
more, a study of this type would take years to perform.
Therefore, to put a perspective on the estimates presented
in this report, the study team has categorically ranked by quali-
tative judgment the overall data quality of the major sources and,
therefore, of the outcomes. These data quality estimates were
ranked into three categories:
High quality ("hard data")—study inputs
with variation of not more than + 25 percent.
Medium quality ("extrapolated data")—study
inputs with variation of + 25 to jh 75 percent.
Low quality ("rough data")—study inputs with
variation of + 50 to +_ 150 percent.
Each of these data quality estimates is presented in the
individual chapters. The overall ranking of the study inputs
for each RACT industrial category was generally in the medium
quality range.
1-6
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Category
EXHIBIT 1-1(1)
U.S. Environmental Protection Agency
LISTING OP EMISSION LIMITATIONS THAT REPRESENT
THE PRESUMPTIVE NORM TO BE ACHIEVED THROUGH
APPLICATION OP RACT FOR FIFTEEN INDUSTRY CATEGORIES
RACT Guideline Emission Limitations31
Surface Coating Categories Based on
Low Organic Solvents (Ibs. solvent
per gallon of coating, minus water)
Surface Coating Of:
Cans
. Sheet basecoat (exterior and interior)
Overvarnish
Two-piece can exterior (basecoat and overvarnish)
. Two and three-piece can interior body spray
Two-piece can exterior end (spray or rollcoat)
. Three-piece can side-seam spray
. End sealing compound
Coils
. Prime and topcoat or single coat
Paper
Fabrics and vinyl coating
. Fabric
. Vinyl
Automobiles and Light Duty Trucks
. Prime application, flashoff and oven
. Topcoat application, flashoff and oven
. Final repair application, flashoff and oven
Metal Furniture
. Prime and topcoat or single coat
Magnet Wire
Large appliance
. Prime, single or topcoat
Solvent Metal Cleaning
Cold cleaning
Conveyorized degreaser
2.8
4.2
5.5
3.7
2.6
2.9
2.9
3.3
1.9
2.3
4.3
3.0
1.7
2.8
Provide cleaners with: cover; facility
to drain clean parts; additional free-
board; chiller or carbon absorber.
Follow suggested procedures to minimize
carryout.
Provide cleaners with: refrigerated
chillers or carbon adsorption system;
drying tunnel or rotating basket; safety
switches; covers. Follow suggested pro-
cedures to minimize carryout.
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EXHIBIT 1-1(2)
U.S. Environmental Protection Agency
Category
RACT Guidelines Emission Limitations31
Open top degreaser
M>
„,, Petroleum Refinery Sources
— . Vacuum producing systems
«M
. Wastewater separators
mf . Process unit turnaround
Bulk Gasoline Terminals
um
"** Bulk Gasoline Plants
Storage of Petroleum Liquids in Fixed
Roof Tanks
Service Stations (Stage I)
Use of Cutback Asphalt
Provide cleaner with: safety switches;
powered cover; chiller; carbon absorber.
Follow suggested procedures to minimize
carryout.
No emissions of any noncondensible VOC
from condensers, hot wells or accumulators
to a firebox, incinerator or boiler
Minimize emissions of VOC by providing
covers and seals on all separators and
forebays and following suggested operating
procedures to minimize emissions
Minimize emissions of VOC by depressurization
venting to vapor recovery, flare or firebox.
No emissions of VOC from a process unit
or vessel until it's internal pressure
is 136 kilo pascals (17.7 psia) or less
Equipment such as vapor control system
to prevent mass emissions of VOC from
control equipment to exceed 30 milligrams
per liter (4.7 grains per gallon) of gaso-
line loaded
Provide submerged filling and vapor bal-
ancing so that VOC emissions from control
equipment do not exceed 80 milligrams
per liter (4.7 grains per gallon) of
gasoline loaded
Provide single seal and internal floating
roof to all fixed roof storage vessels
with capacities greater than 150,000
liters (39,000 gal.) containing volatile
petroleum liquids for which true vapor
pressure is greater than 10.5 kilo
Pascals (1.52 psia)
Provide submerged fill and vapor balance
for any stationary storage tank located
at a gasoline dispensing facility
The manufacture, mixing, storage, use
or application may be approved where:
long-life stockpile storage is necessary;
the use or application is an ambient tem-
perature less than 10°C (50°F) is necessary;
or it is to be used solely as a penetrating
prime coat
Mote: An alternative scenario to the recommended RACT guidelines for surface coating
of automobiles is also studied. It assumes that the timing requirements and
possible limitations are modified to meet developing technologies.
a. Annotated description of RACT guidelines
Source; Regulatory Guidance for Control of Volatile Organic Compound Emissions from 15
Categories o£ Stationary Sources, U.S. Environmental Protection Agency, EPA-905/2-
78-001, April 1978.
-------
-------
1.2 STATEWIDE AGGREGATE ECONOMIC IMPACT
FOR THE FIFTEEN RACT GUIDELINES
-------
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1.2 STATEWIDE AGGREGATE ECONOMIC IMPACT
FOR THE FIFTEEN RACT GUIDELINES
The implementation of RACT emission limitations for fifteen
industrial categories in Illinois involves an estimated $200
million capital cost and $36 million annualized cost per
year. The net VOC emission reduction is estimated to be
150,000 tons annually from a 1977 baseline of 239,000 tons.
Exhibit 1-2, on the following page, presents a quantitative
summary of the emissions, estimated cost of control, cost
indicators and cost effectiveness of implementing RACT guide-
lines for fifteen industrial categories.1
Approximately 36,800 facilities are potentially
affected by the fifteen RACT guidelines in
Illinois.
Ninety-seven percent of the potentially
affected facilities are represented by the
solvent metal cleaning (20,000 facilities)
and service station (15,540 facilities) in-
dustrial categories.
Less than 1 percent (105 facilities) of the
potentially affected facilities are repre-
sented by the eight surface coating industrial
categories (cans, coils, paper, fabrics,
automobiles, metal furniture, magnet wire
and large appliances).
In 1977, the estimated annual VOC emissions (in-
cluding those already controlled) for the fifteen
RACT industrial categories totalled approximately
239,000 tons.
Three gas marketing categories (tank truck
loading terminals, bulk gas plants and service
stations) represented 35 percent of the total
VOC emissions
Solvent metal cleaning represented 22 percent
of the total VOC emissions (from the fifteen
RACT categories studied)
Refinery systems represented 3 percent of the
total VOC emisssions
1. An alternative scenario for the surface coating of automobiles
is also presented in the text of the next section. The EPA
recommended RACT limitations for automobile assembly plants
represent a waterborne topcoat system which would require
extensive modification of the current production lines. Under
the alternate scenario it is assumed that RACT requirements
are modified to meet specific technologies that are more
cost and energy effective.
1-7
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EXHIBIT 1-2
Number of
Facilities
Potentially
Industry Category Affected
Surface coating 30
of cans
Surface coating 9
of coils0
Surface coating 25
of paper
Surface coating 2
of fabrics
Surface coating 2
of automobiles
Surface coating of 24
metal furniture
Surface roaring i
for insulation
of magnet wire6
Surface coating of 8
large appliances
Solvent metal 20,000
cleaning
Refinery vacuum 12
wastewater
separators
and turnarounds
Tank truck gas- 34
oline loading
terminals
Bulk gasoline 1,100
plants
Storage of petro-
leum liquids in
fixed roof tanks'
Service Stations 15,540
(Stage I)
Cutback ASBhalt f
TOTAL 36,800
Emissions
Estimated VOC
Emissions
After set VOC
1977 VOC Implementing Emission
Emissions RACT Reductions
(tons/yr.) (tons/yr.) (tons/yx.)
3.200 2,360 5,840
2,318 2,318 0
27,300 5i200 22,100
600 120 480
4,000 1,300 2,700
1,606 231 1,375
51 51 0
4,140 1,240 2,800
51,400 39,000 12,400
7,600 400 7,200
22,630 2,300 20,330
11,500 3,700 7,800
- - -
48,900 30,700 18,200
49,000 0 49,000
239,000 89,000 150,000
SUMMARY OF IMPACT OF IMPLEMENTING RACT
GUIDELINES IN 15 INDUSTRIAL CATEGORIES — ILLINOIS
Cost
Cost of RACT Control Cost Indicators Effectiveness
Annuallzed
Cost as Annualizsd Annuallzed
Percent of Cost Per Cost (credit)
Capital Annualizad Value of Unit Per Ton of VOC
Costa Cost (credit) Shipments^ Shipment Reduction
(S millions) IS millions) (percent) (cost per unit) (5 per tons/yr.)
•*•«. °-9 0.1 negligible 145
.
32 8.6 1.3 increase of 1.1 360
to 1.6 percent
2.7 0.7 DA increase of 1.8 1,400
percent
100 15 0.9 $50/car 5,500
4.0 1.6 0.4 varies with area 2,206
coated
- - - - -
3.2 0.8 0.05 SO.IS/househola 254
appliance
10.6 0.9 <0.01 negligible 73
°-5 0.13 negligible negligible 18
10.4 (0.93) (0.1) negligible (45)
17.1 4.8 0-8 *0.0034/gal 615
- - • • •
14.7 3.7 0.14 <30.001/gal 203
0.2 0 0 0 0
300 36.1
Mote, riaures presented in thi» exhibit are rounded and approximated for comparison purpoeee
a. Includes one tiae coats
b. Value of shipments represents the total value in the specific industry category for the state being studied.
=. All coil coating and magnet wire coating facilities nave implemented controls prior to the RACT guidelines and are assumed
within compliance.
d. This represents the industrywide increase! email operations will be subject to a $0.005 to $0.01 gallon increase.
e. This study does not address the economic impact of Control requirements for this category.
t. Estimate use of cutback asphalt in 1977 was 269,000 tone.
Source i Boos, Allen t Burr'' *-"• Inc.
-------
Use of cutback asphalt represented 21 percent
of the total VOC emissions.
- Eight surface coating categories represented
20 percent of the total VOC emissions.
The net emission reduction achievable by implementing
the fifteen RACT guidelines is estimated to be
150,000 tons annually. The approximate percent of the
total VOC emissions reduced by implementing RACT
by industrial category group is:
Gas marketing categories - 31 percent of VOC
emission reduction
Use of cutback asphalt - 33 percent of VOC
emission reduction. (However, this assumes
complete discontinued use.)
Surface coating categories - 24 percent of
VOC emission reduction
Solvent metal cleaning category - 8 percent
of VOC emission reduction
Refinery vacuum systems - 5 percent of VOC
emission reduction.
The capital cost for the fifteen industrial categories
to achieve the RACT guidelines is estimated to be
$200 million.
Approximately 50 percent of the total estimated
capital cost is for control of automobile
assembly plants. The capital required to
meet RACT guidelines for automobile surface
coating is estimated to be $100 million. (An
alternative scenario to the recommended RACT
limitations for automobiles is also developed.
This alternate scenario would represent an
estimated capital cost of $12 million.)
- The three industrial categories dealing with
petroleum marketing (bulk gasoline plants,
bulk gasoline terminals and service stations)
account for approximately $42 million (or 21
percent of the total) of the estimated
capital cost.
1-8
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The annualized cost of the fifteen RACT industrial
categories to achieve the RACT guidelines is
estimated to be $36.2 million. The control of
automobile assembly plants is estimated to be
$15 million annualized cost (the alternate
scenario for auto assembly was an estimated
annualized cost of $2 million). In terms of
cost indicators, the annualized compliance cost
per value of shipments will have the largest effect
on the following industrial categories:
Paper coating—The annualized cost rep-
resent approximately 1.3 percent of the
1977 statewide value of shipments.
Surface coating of automobiles—The
annualized compliance costs represent
approximately 0.9 percent of 1977 state-
wide value of shipments.
Bulk gasoline plants—The annualized
compliance costs represent approximately
0.8 percent of the 1977 statewide value of
shipments.
1-9
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Technology developments and delivery of equipment
could present problems in achieving the 1982
timing requirements of the RACT guidelines.
- The recommended RACT guidelines for
automobile assembly plants would require
a waterborne topcoating. Manufacturers
could not convert facilities on a nation-
wide basis to waterborne topcoat systems
by the 1982 timeframe.
- Low solvent coating technology requires
further development for cost- and energy-
effective implementation of the RACT guide-
lines in the following industrial categories:
Surface coating of automobiles
Surface coating of large appliances
(high solids coatings have not been
commercially proven)
Surface coating of cans (end sealing
compound)
Surface coating of metal furniture
(full color line is currently not
available).
- Equipment delivery and installation of control
equipment were identified as potential
problems in the following industrial categories
Surface coating of paper
Solvent metal degreasing
Tank truck gasoline loading terminals
Bulk gasoline plants
Surface coating of fabrics
Gasoline service stations.
With the exception of bulk gasoline plants and
automobile assembly plants, the implementation of
the RACT guidelines are not expected to have major
impact on statewide productivity or employment.
- Capital cost requirements for bulk gasoline
plants could further concentrate a declining
industry. Many small bulk plants today are
marginal operations and further cost increases
may result in some plant closings.
1-10
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Conversion of automobile assembly plants
to waterborne topcoat systems would require
extensive modification of current facilities;
with potential increased productivity and
decreased employment for older facilities that
could modernize production lines.
The implementation of the RACT guidelines is ex-
pected to create further concentration for industrial
sectors requiring major capital and annualized
cost increases for compliance. RACT requirements
may have an impact on the market structure of the
following RACT industrial categories:
Bulk gasoline plants
Service stations
Surface coating of paper.
The implementation of the RACT guidelines for the
fifteen industrial categories is estimated to repre-
sent a net energy savings of 150,000 equivalent
barrels of oil annually; or 0.1 percent of the state-
wide energy demand for all manufacturing. Assuming a
value of oil at $13 per barrel, this is an equivalent
energy savings of $2.0 million annually. Exhibit 1-3,
on the following page, presents the estimated change
in energy demand from implementation of the RACT
guidelines in Illinois.
- RACT compliance requirement for the eight
surface coating industrial categories (cans,
coil, paper, fabrics, automobiles, metal
furniture, insulation of magnet wire and
large appliances) represent a net energy
demand of approximately 223,000 equivalent
barrels of oil annualy.
RACT compliance requirements for refinery
systems represent a net energy savings of
approximately 50,000 equivalent barrels of
oil annually.
RACT compliance requirements for the three
industrial categories dealing with petroleum
marketing (service stations, bulk gasoline
terminals, bulk gasoline plants) represent
a net energy savings of approximately 325,000
barrels of oil annually. However, the control
efficiency has not been fully demonstrated and
these estimates are likely to overstate the
achievable energy savings for bulk gasoline
plants and service stations.
1-11
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I i i t I f i i i i f i I i I I I i I i I i i i I i t f t f I i t I t i t
EXHIBIT 1-3
U.S. Environmental Protection Agency
ESTIMATED CHANGE IN ENERGY DEMAND RESULTING
FROM IMPLEMENTATION OF RACT GUIDELINES IN ILLINOIS
Industry Category
Surface coating of cans
Surface coating of coils
Surface coating of paper
Surface coating of fabrics
Surface coating of automobiles
Surface coating of metal furniture
Surface coating for insulation of magnet
Surface coating of large appliances
Solvent metal cleaning
Refinery systems
Tank truck gasoline loading terminals
Bulk gasoline plants
Storage of petroleum liquids in fixed
roof tanks
Service stations (STAGE I)
Use of cutback asphalt
TOTAL
Energy Demand Change
Increased (Decrease)
(Equivalent barrels of oil)
23,000
None
115,000
4,000
87,000
None
wire None
(6,400)
1,500
(50,000)
(139,000)
(62,000)
Not studied
(124,000)
None
Energy Demand Change
Cost/(Savings)
a
($ million)
0.3
None
1.5
0.1
1.1
None
None
(0.1)
negligible
(0.7)
(1.8)
(0.8)
Not studied
(1.6)
None
(150,900)
(2.0)
a. Based on the assumption that the cost of oil is $13 per barrel.
-------
In 1977, the statewide value of shipments of the fifteen
industrial categories potentially affected by RACT was $15.3
billion, which represents approximately 15 percent of Illinois'
total value of shipment of manufacturing goods. The esti-
mated annualized cost of implementing the RACT guidelines
($36 million) represents 0.2 percent of the value of shipments
for the fifteen RACT industrial categories affected. The
annualized cost represents 0.03 percent of the statewide total
value of shipment of all manufactured goods.
1-12
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1.3 ECONOMIC IMPLICATIONS OF EACH RACT GUIDELINE
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1.3 ECONOMIC IMPLICATIONS OF EACH RACT GUIDELINE
This section presents a summary of the economic impact
for each of the fifteen RACT industrial categories studied.
Following this section is a series of summary exhibits which
highlight the study findings for each industrial category.
1.3.1 Surface Coating of Cans
Currently there are thirty major can coaters in the state
of Illinois. The Chicago area is one of the largest can manu-
facturing centers in the country.
The industry-preferred method of control to meet the
RACT requirements is to convert to low solvent (waterborne)
coatings. However, low solvent coatings for end sealing
compounds are presently not available and may not be avail-
able by 1982. To meet the RACT requirements, can manu-
facturers may convert some facilities to waterborne two-
piece can lines (where commercially feasible) and install
thermal incineration for controlling high solvent coatings.
It is possible that the manufacturing of precoated stock
will be further centralized in larger facilities for cost-
effectiveness, in addition to meeting RACT requirements.
Emission controls are expected to cost $4.4 million in
capital and $0.9 million (approximately 0.1 percent of state-
wide industry value of shipments) in annualized costs to meet
RACT guidelines.
1.3.2 Surface Coating of Coils
There were nine coil coaters identified in the state
of Illinois. These facilities have already installed thermal
oxidation systems which are assumed to meet the RACT guide-
lines. Therefore, no significant economic impact in the state
of Illinois to implement the RACT guidelines is expected for
the coil coating industry category.
1.3.3 Surface Coating of Paper
This study covered 25 plants identified from the state
emission inventory who are primarily web coaters. Excluded
from this study are facilities engaged in publishing, who
may coat paper as a segment of the processing line. The
study assumes that these facilities would fall under other
RACT guidelines currently being developed, such as Graphic
Arts. Further definition of the paper coating category needs
to be established prior to regulatory enforcement.
1-13
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The individual retrofit situations and installation costs
for add-on controls are highly variable. Based on these
variations, the estimated capital cost to the industry is
between $27 million and $36 million, with annualized cost of
$6.7 million to $9.6 million (approximately 1.3 percent of the
statewide value of shipments). The smaller firms have indicated
they may not be able to secure the necessary capital funding
for add-on systems, and some may consider going out of the
business. The effect on employment will be a function of the
number of firms that may decide to curtail operations.
Assuming 35 percent heat recovery, the annual energy
requirements are expected to increase by approximately 115,000
equivalent barrels of oil per year. Energy consumption may
decrease if further efficient recovery of incinerator heat is
possible.
Incinerator equipment manufacturers have stated that
there may be significant problems in meeting the anticipated
demand for high heat recovery incinerators.
1.3.4 Surface Coating of Fabrics
There are two firms in Illinois identified as coaters
of fabric and affected by the proposed RACT guidelines.
It is estimated that these facilities will be required to
invest an estimated $2.7 million in capital and approximately
$0.7 million in annualized cost to meet RACT limitations.
No significant productivity, employment or market
structure dislocations should be associated with the im-
plementation of the RACT guideline.
Assuming a 70 percent heat recovery, about 4,000
barrels of additional fuel oil per year would be required to
operate the control equipment.
1.3.5 Surface Coating of Automobiles
There are two major companies operating automobile assembly
plants in Illinois. Illinois' value of shipments of automobiles
represents approximately 3.5 percent of the automobiles manufac-
tured in the U.S. The EPA recommended RACT guidelines would
require conversion to waterborne paints. However, the EPA
is currently considering some modifications of the RACT require-
ments for automobile assembly plants. Therefore, there are
two scenarios of RACT guidelines studied:
1-14
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Scenario I—Current RACT limitations implemented by
1982. Under this scenario it is assumed that automobile
assembly plants will convert facilities to the following
available paint technologies to meet the RACT requirements:
Cathodic electrodeposition for prime coat
Waterborne enamels for topcoat
High solids enamels for final repair.
The implementation of these technologies would require
extensive modification to the two facilities in Illinois.
The capital required would be approximately $100 million.
The estimated annual!zed compliance cost is $15 million and
would represent an increased energy demand of approximately
87,000 barrels of oil annually. If this increased cost
were passed on directly it would represent an increase in
price of $50 per automobile manufactured. These major modi-
fications would require approximately three to four years
for completion and although possibly achievable in Illinois,
all assembly plants in the U.S. could not convert to these
technologies by 1982.
Scenario II—Modified RACT requirements to meet specific
technologies. Under this scenario it is assumed that automobile
assembly plants will develop and apply the following paint
technologies:
Cathodic electrodeposition for prime coat
High solids enamels, urethane enamels, powder
coating or equivalent technologies for topcoat
High solids enamels for final repair.
The major area of modification in this scenario is the
technology applied for topcoat paints. Under this scenario it
it assumed that the RACT limitations could not be achieved by
the 1982 timeframe. It is assumed that manufacturers currently
using enamel paints would develop higher solids enamels that
would approach or achieve the emission reduction of waterborne
paints. The capital requirements for Scenario II are estimated
to be $12 million. The estimated annualized compliance cost
is $2 million. If this increased cost were passed on directly
it would represent an increase in price of $7 per automobile
manufactured.
1-15
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1.3.6 Surface Coating of Metal Furniture
There are 23 facilities in Illinois identified as manufac-
turers and coaters of metal furniture and potentially affected by
the proposed RACT guidelines. These facilities will be required
to invest an estimated $4 million in capital and approximately
$1.6 million (0.40 percent of the industry's 1977 value of ship-
ments) in annualized costs to meet the RACT limitations.
No significant productivity, employment or market structure
dislocations should be associated with the implementation of the
RACT guideline.
Conversion to waterborne coating may pose a problem for one
company (because of specific processing techniques) if suitable
waterborne coatings material capable of withstanding corrosive
environment were not developed in time.
1.3.7 Surface Coating for Insulation of Magnet Wire
This study has identified five facilities currently coating
magnet wire for insulation in the state of Illinois. All of these
facilities have already implemented controls which are assumed to
be in accordance with the RACT guidelines. Therefore, in Illinois,
the implementation of RACT guidelines for magnet wire coating is
not expected to have any substantial economic impact or reduce
emissions.
1.3.8 Surface Coating of Large Appliances
There are eight facilities identified as major coaters of
large appliances in Illinois. The industry statewide is estimated
to invest approximately $3.2 million in capital and incur additional
annualized costs of $0.8 million (approximately 0.05 percent of
industry statewide value of shipments) to meet the emission
limitations.
Assuming a "direct cost passthrough," the cost increase for
household appliances relates to a price increase of approximately
$0.15 per unit. Certain manufacturers could incur disproportionate
compliance costs, which could further deteriorate the profit
position of marginally profitable operations. Of the firms with
marginally profitable operations that may be affected, none of
the companies contacted indicated that they might cease production.
No major productivity, employment or market structure dislocations
appear to be associated with implementation of the RACT guide-
lines.
1-16
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The high solids (greater than 62 percent by volume)
topcoat application technique preferred by the industry has
not been commercially proven under normal operating conditions
although it appears to be technically feasible.
1.3.9 Solvent Metal Cleaning
This category includes equipment to clean the surface
for removing oil, dirt, grease and other foreign material by
immersing the article in a vaporized or liquid organic
solvent. The cleaning is done in one of three devices: a
cold cleaner, an open top vapor degreaser, or a conveyorized
degreaser. This type of cleaning is done by many firms in many
different types of industries.
Implementation of the proposed RACT guidelines for an
estimated 20,000 facilities is expected to have a negligible
economic effect on industry because of the relatively minor
changes required. Statewide, the many facilities potentially
affected represent a capital cost of $10.6 million and an
annualized cost of $0.9 million «0.01 percent of industry
value of shipments).
Because of the large number of degreasers that require
retrofit to meet RACT and the inability of manufacturers to
provide equipment on such a large scale, it is doubtful if
all degreasers can be retrofitted within the 1982 timeframe.
No major productivity, employment and market structure
dislocations will result from RACT implementation.
1.3.10 Refinery Vacuum Systems, Wastewater Separators
and Process Unit Turnarounds
There were 12 refinery facilities in the state of
Illinois potentially affected by the proposed RACT guidelines.
The RACT requirements represent a capital investment of approxi-
mately $500,000 and an annualized cost of approximately $130,000.
No significant productivity, employment or market
structure dislocations should be associated with the imple-
mentation of the RACT guideline.
1-17
-------
1.3.11 Tank Truck Gasoline Loading Terminals
There are 34 facilities identified in the state of
Illinois as tank truck gasoline loading terminals. Emission
control of these facilities is expected to require a capital
investment of $10.4 million. Product recovery of gasoline
will be accrued to bulk terminal operations not only from
bulk terminal emission control installations but also from
the recovery of vapors from service stations and bulk gasoline
plants. Based on this savings, the annualized credit for
implementation of RACT for bulk gasoline loading terminals is
estimated to be $0.9 million.
No significant productivity, employment or market
structure dislocations should be associated with implementing
the RACT guidelines.
1.3.12 Bulk Gasoline Plants
This industry is characterized by many small plants.
Of these plants, only a few percent are either new or modern-
ized. The majority of the plants are over 20 years old.
Most bulk plants are located in rural areas where imple-
mentation of RACT to stationary sources may not be required.
However, the economic analysis presented includes all bulk
gas plant facilities, regardless of location.
To meet the RACT requirements, bulk gas plants must be
equipped with vapor balance and submerged fill systems.
This recommended control system is not cost-effective for
the bulk plant operator as most of the economic credit (for
recovered vapors) would be accrued to a bulk terminal or
refinery.
The estimated capital cost and annualized cost to meet
compliance requirements for the 1,100 facilities in the state
of Illinois represent $17.1 million and $4.8 million (approxi-
mately 0.8 percent of industry statewide value of shipments),
respectively. Industrywide, the price of gasoline (assuming a
"direct cost pass-through") would be increased $0.003 per
gallon, but the small volume operators would be more severely
affected, with costs increasing between $0.005 per gallon and
$0.01 per gallon. Because of the competitiveness and low
profit structure in the industry, further cost increases
could force some marginal operations out of the business,
thus further concentrating the market structure. In urban
areas, the bulk gasoline plant markets have been declining
because of competition from retailers and tank truck term-
inals, and are expected to continue to decline regardless of
the RACT guidelines.
1-18
-------
The implementation of the RACT alternatives of submerged
filling and vapor balancing could produce an energy saving
equivalent to 62,000 barrels of oil per year assuming a
control efficiency as defined by the RACT guidelines. This
assumed control efficiency has not been fully demonstrated.
1.3.13 Storage of Petroleum Liquids in Fixed Roof Tanks
Under the direction of Illinois EPA, the economic impact
of implementing RACT for the storage of petroleum liquids in
fixed-roof tanks was not studied in detail by Booz, Allen.
However, the control requirements of RACT may affect
approximately 100 fixed roof storage tanks that are currently
exempted under Illinois Rule 205(a). Although this study does
not address the economic impact of controlling those currently
exempted tanks, the impact may be significant.
1.3.14 Service Stations
Of the estimated 15,540 gasoline dispersing facilities
potentially affected in Illinois, approximately 4 percent are
considered small gasoline stations (throughput less than 10,000
gallons per month). These stations will experience a cost
increase of almost $0.001 per gallon to implement RACT; larger
stations will experience a much smaller unit cost increase.
Statewide, the industry capital cost is $14.7 million and
annualized cost is $3.7 million (approximately 0.14 percent
of the statewide value of gasoline sold) for implementing
submerged fill and vapor balancing. The service stations
could experience loss of business while vapor control systems
are being installed.
1-19
-------
Implementation of the RACT guidelines may accelerate
the trend to high throughput stations because of the in-
creasing overhead costs. However, the RACT guidelines will
not cause major productivity and employment dislocations to
the industry as a whole.
It is estimated that implementing RACT guidelines for
service stations in Illinois will result in a net energy
savings equivalent to 124,000 barrels of oil per year. This
assumed control efficiency has not been fully demonstrated.
The economic benefit of the recovered gasoline vapors will
not accrue to the service stations.
1.3.15 Use of Cutback Asphalt
In 1977, it is estimated that 269,000 tons of cutback
asphalt were utilized in the state of Illinois. Replacement
of the solvent based asphalt with asphalt emulsion will cause
no dislocation in employment or worker productivity. Training
costs are estimated at $200,000.
It is anticipated that sufficient lead time is available
to assure an adequate supply of asphalt emulsion to meet
the increased demand and provide training for municipal
employees.
A summary of the direct economic implications of im-
plementing RACT in each of the 15 industrial categories
studied is presented in Exhibits 1-4 through 1-18, on the
following pages.
1-20
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EXHIBIT 1-4
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR CAN MANUFACTURING PLANTS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
VOC emissions
Industry preferred method of VOC
control to meet RACT guidelines
Discussion
There are 30 can manufacturing facilities
The Chicago area is one of the largest can
manufacturing centers in the country. The
1977 value of shipments was about $800
million
Beer and beverage containers rapidly
changing to two-piece construction
8,000 tons per year (Booz, Allen estimate)
theoretical uncontrolled level is 11,100
tons per year
Low solvent coatings (waterborne)
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized operating cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after control
Cost effectiveness of control
$9.5 million from uncontrolled state
(4.4 million above 1977 level). Current
investments are $15 million to $30 million
$2.7 million—about 0.3 percent of current
direct annual operating costs ($0.89 million
above 1977 level)
Assuming a direct pass-through of costs, no
significant change in price
Increase of 23,00 equivalent barrels of oil
annually to operate incinerators (virtually
no increase from 1977 level)
No major impact
No major impact
Accelerated technology conversion to
two-piece cans
Further concentration of sheet coating
operations into larger facilities
Low solvent coating technology for end
sealing compound
2,360 tons per year (28 percent of 1977
emi s s ion leve1)
$323 annualized cost/annual ton of VOC
reduction from theoretical level ($153
per ton attributable to RACT)
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 1-5
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR COIL COATING FACILITIES
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected facilities
Discussion
There are 9 coil coating facilities
coating coils in Illinois. They cur-
rently meet RACT emission limitations
Current industry technology trends
Due to the pressures of energy availability
as well as environmental protection, most
firms have or are installing regenerative
type incinerators
1977 VOC emissions (actual)
2,318 tons per year
Industry preferred method of VOC control
to meet RACT guidelines
Regenerative thermal incineration
Assumed method of control to meet RACT
guidelines
Regenerative thermal incineration
Affected Areas in Meeting RACT
Capital Investment (statewide)
None
Discussion
Annualized Cost (statewide)
None
Energy
None
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
No impact
No impact
No impact
No impact
None
VOC emission after control
2,318 tons per year
Cost effectiveness of control
None
Source: Booz, Allen 6 Hamilton Inc.
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EXHIBIT 1-6(1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR PAPER COATERS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected facilities
Indication of relative importance of the
industry to the state economy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC control
to meet RACT guidelines
Assumed method of control to meet RACT
guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem areas
Discussion
Approximately 25 plants have been identified
from the emission inventory. However, if
this category is interpreted to include all
types of paper coating, including publishing,
far more firms would be affected.
The 1977 value of shipments of the 25 plants
identified is estimated to be approximately
$600 million. These plants employment is
estimated to be approximately 9,500
Gravure coating replacing older systems
Approximately 27,300 tons per year were identifiei
from the emission inventory. Actual emissions
are expected to be higher.
Though low solvent coating use is increasing,
progress is slow. Add-on control systems will
probably be used.
Thermal incineration with primary and secondary
heat recovery
Discussion
Estimated to be $27 million to $36 million
depending on retrofit situations. This is
likely to be more than 100 percent of normal
expenditures for the affected paper coaters.
$6.7 million to $9.6 million annually. This
represents approximately 1.1 to 1.6 percent
of the 1977 annual sales for the affected paper
coaters on an industrywide basis.
Assuming a "direct cost pass-through"—1.1 to 1.6
percent on an industrywide basis
Assuming 35 percent heat recovery annual energy
requirements are expected to increase by approxi-
mately 115,000 equivalent barrels of oil annually.
Mo major impact
No major impact
Smaller firms may be unable to secure capital
funding for add-on systems, which are typically
$250,000 or more for a moderate-sized incinerator
to over $1 million for a carbon adsorber.
RACT guideline needs clear definition for
rule making.
Equipment deliverables and installation of in-
cineration systems prior to 1982 are expected to
present problems
Retrofit situations and installation costs are
highly variable
Type and cost of control depend on particular
solvent systems used and reduction in air flow
-------
Source: Booz, Allen & Hamilton Inc.
EXHIBIT 1-6(2)
U.S. Environmental Protection Agency
Affected Areas in Meeting RACT
VOC emissions after control
Discussion
5,200 tons/year (20 percent of 1977 VOC emission
level)
Cost effectiveness of control
$300 - $430 annualized cost/annual ton of VOC
reduction
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EXHIBIT 1-7
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR FABRIC COATERS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected facilities
Indication of relative importance of
industrial section to state economy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control to
meet RACT guidelines
Discussion
Two firms were identified as being affected
by the proposed regulation
The two plants affected are estimated to have
annual shipments of $30 million to $40 million.
These plants employ about 400 persons.
Newer plants are built with integrated coating
and emission control systems; older plants are
only marginally competitive now
Current emissions are estimated at about 600
tons/year
Direct fired incineration and water scrubbing
for shoft range, low solvent coatings are a
long range goal.
Direct fired incineration with primary
heat recovery.
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market Structure
RACT timing requirements (1982)
Problem areas
VOC emissions after RACT control
Cost effectiveness of RACT control
Discussion
Study team estimate is about $2.4 million
to $3.1 million.
Approximately $0.61 million to $0.85 million.
Assuming a "direct pass-through of costs"
prices of coated fabrics will increase by about
1.5 to 2.1 percent.
Assuming 35 percent heat recovery, about 5,500
equivalent barrels of additional fuel oil would
be required per year
No major impact
Mo major impact
No change in market structure within the state
is anticipated; firms affected have different
product lines
Plants may have problem in control equipment
deliveries
Additional capital and operating costs may make
the plants uncompetitive with more modern and
efficient ones
Capital and operating costs can only be approxi-
mated because of unknown retrofit situations
120 tons/year (20 percent of 1977 VOC emissions)
$1,250 to $1,750 annualized cost/annual ton
of VOC reduction.
Note: Cost data are based on emission information supplied by the Illinois EPA.
Source; Booz, Allen 6 Hamilton Inc.
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EXHIBIT 1-8(1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO I FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF ILLINOIS
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
Number of potentially affected facilities
Indication of relative importance of indus-
trial section to state enconomy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC control
to meet RACT guidelines
Assumed method of control to meet RACT
guidelines
Affected Areas in Meeting RACT
Scenario I
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity and employment
Discussion
Two companies operating two facilities
1977 value of shipments was approximately
$1.6 billion which represents approxi-
mately 1.6 percent of the state's manu-
facturing industry. Of all states,
Illinois ranks ninth in automobile
production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
4,000 tons per year
Cathodic electrodeposition for prime
coat. High solids enamel for topcoat.
Cathodic electrodeposition for prime coat
Waterborne enamels for topcoat
High solids enamels for final repair
Discussion
$100 million (approximately 400 percent
of current annual capital expenditures
for the industry in the state)
$15 million (approximately 0.9 percent
of the industry's 1977 statewide value
of shipments)
Assuming a "direct cost pass-through"
approximately $50 per automobile manu-
factured
Increase of 87,000 equivalent barrels
of oil annually primarily for operation
of waterborne topcoating systems
Conversion to waterborne systems would
require total rework of existing pro-
cessing lines. Major modifications
would probably increase efficiency and
line speed.
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EXHIBIT 1-8(2)
U.S. Environmental Protection Agency
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
Discussion
Market structure
RACT timing requirements (1982)
Problem areas
VOC emission after RACT control
Cost effectiveness of RACT control
Accelerated technology conversion to
electrodeposition primer coat
Conversion of all automobile assembly
plants nationwide to topcoating water-
borne systems cannot be achieved by 198.
Prime coat RACT limitations are based
on anodic electrodeposition systems
and should be modified to reflect
cathodic processing. Topcoat RACT
limitations are based on waterborne
coatings, which is not a cost or energy
effective alternative. Final repair
RACT limitations are based on high
solids enamel technology which is likely
to require major modifications for man-
ufacturer's using lacquer systems
1,300 tons per year (33 percent of 1977
emission level)
$5,550 annualized cost/annual ton of
VOC reduction
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 1-9(1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO II FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF ILLINOIS
SCENARIO II
(Modified RACT Requirements
To Meet Specific Technologies)
Current Situations
Number of potentially affected facilities
Indication of relative importance of indus-
trial section to state enconomy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC control
to meet RACT guidelines
Assumed method of control to meet RACT
guidelines
Affected Areas in Meeting RACT
Scenario II
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity and employment
Discussion
Two companies operating two facilities
1977 value of shipments was approximately
$1.6 billion which represents approximately
1.6 percent of the state's manufacturing
industry. Of all states, Illinois ranks
ninth in automobile production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
4 , 000 tons per year
Cathodic electrodeposition for prime
coat. High solids enamel for topcoat.
Cathodic electrodeposition for prime coat
High solids enamels for topcoat. High
solids enamel for final repair.
Discussion
$12 million (approximately 50 percent
of current annual capital appropriations
for the industry in the state)
$2 million (approximately 0.1 percent of
the industry's 1977 statewide value of
shipments)
Assuming a "direct cost pass-through"
approximately $7 per automobile manufac-
tured
Dependent on technology applied
No major effect
-------
EXHIBIT 1-9(2)
U.S. Environmental Protection Agency
SCENARIO II
(Modified RACT Requirements
To Meet Specific Technologies)
Current Situation
Market structure
RACT timing requirements
Problem area
VOC emission after RACT control
Cost effectiveness for RACT control
Discussion
No major effect
Primer and final repair limitations could
be implemented at most facilities by 1982
Topcoat limitations could be set at a 40
percent to 62 percent solids by 1985
dependent on technology developments
Limitations for topcoat are dependent
on technology development
1,300-2,100 tons per year (33 percent to
52 percent of 1977 emission levels dependent
on limitations)
$740-51050 annualized cost/annual ton
for VOC reduction
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-10
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING OF METAL
FURNITURE IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Discussion
There are 23 metal furniture manufacturing
companies with 24 facilities
1977 statewide value of shipments was $440
million
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC
control
Assumed method of VOC control to
meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Trend is towards the use of a variety of
colors
1,606 tons per year
Low solvent coatings
Low solvent coatings
Discussion
$4 million
$1.6 million (approximately 0.4 percent of
current value of shipments)
Varies from a few cents to more than $1 per
unit of furniture depending upon surface area
coated (assuming a "full-cost passthrough")
No major impact
No major impact
No major impact
No major impact on overall structure. However,
one company is expected to bear disproportionate
costs.
Companies using a variety of colors may face
a problem
Low solvent coating in a variety of colors
providing acceptable quality needs to be
developed
231 tons per year (15 percent of current
emissions level)
$1,206 annualized cost/annual ton of VOC
reduction
Source: Booz, Allen 6 Hamilton, Inc.
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EXHIBIT 1-n
U.S. Environmental Protection A9ency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING FOR INSULATION
OF MAGNET WIRE IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control to
Discussion
There are five facilities that coat magnet wire and
meet the RACT emission limitations
1977 statewide value of shipments was esti-
mated at $66 million and represents 8 percent of
the estimated $830 million value of shipments
of the magnet wire industry nationwide
51 tons per year
Waterborne coating or add on catalytic incinera-
tor with primary heat recovery
Waterborne coatings (where applicable) or add on
catalytic incinerator with primary heat recovery
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emissions after RACT control
Cost effectiveness of RACT control
Discussion
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
51 tons per year
No major impact
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-12
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control to
meet RACT guidelines
Discussion
There are eight major large appliance manufacturer
and coaters
1977 statewide value of shipments was estimated
at SI.6 billion and represents 10 percent of
the estimated $15 billion U.S. value of shipments
of the major appliance industry
4,136 tons per year
Waterborne primecoat and high solids topcoat
Waterborne primecoat and high solids topcoat
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$3.2 million
$800,000 which represents 0.05 percent of the
industry's 1977 statewide value of shipments.
Assuming a "direct cost pass-through"—increase
of $0.15/unit for household appliances (based on
a nominal price of $311 per unit appliance)
Reduced natural gas requirements in the curing
operation (equivalent to 6,400 barrels of oil
per year)
No major impact
No major impact
No major impact
Possible problem meeting equipment deliveries
and installation are anticipated if majority of
require deliveries in the same time frame
Commercial application of high solids (greater
than 62% by volume) has not been proven
1,244 tons/year (30 percent of 1977 emission
level)
$254 annualized cost/ton VOC reduction
Source: Booz, Allen £ Hamilton, Inc.
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EXHIBIT 1-13
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SOLVENT METAL DECREASING
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control
meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market Structure
RACT timing requirements (1982)
Problem Areas
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
About 20,000 plants
Value of shipments of firms in SIC groups af-
fected is in the range of $40 billion, about
one-half of the state's 1977 value of shipments.
Where technically feasible, firms are sub-
stituting exempt solvents
51,400 tons/year
Substitution. Otherwise lowest cost option
as specified by EPA will be used.
Equipment modifications as specified by the
RACT guidelines
Discussion
$10.6 million
$0.9 million, (less than 0.01 percent of the
1977 statewide value of shipments)
Metal cleaning is only a fraction of manu-
facturing costs; price effect expected to
be less than 0.01 percent
Less than 1,500 equivalent barrels of oil
per year increase
5-10 percent decrease for manually operated
degreasers. Will not effect conveyorized
cleaners.
No effect except a possible slight decrease
in firms supplying metal degreasing solvents
No change
Equipment availability—only a few companies
now supply the recommended control modifications
No significant problem areas seen
39,000 tons/year (76 percent of 1977 VOC emission
level—however, this does not include emission
controls for exempt solvents)
$73 annualized cost per ton of emissions reduced
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-14
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF IMPLEMENTING
RACT FOR REFINERY VACUUM PRODUCING SYSTEMS, WASTEWATER
SEPARATORS AND PROCESS UNIT TURNAROUNDS
IN THE STATE OF ILLINOIS
Current Situation
Kumber of potentially affected
facilities
Indication of relative impor-
tance of industrial section to
state economy
Current industry technology
trends
1977 VOC actual emissions
Industry preferred method of
VOC control to meet RACT
guidelines
Assumed method of VOC control
to meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost ._ii* <-'r'
(statewide)
Price
Energy3
Discussion
12
Productivity
Employment
Market structure
VOC emission after control
Cost effectiveness of control
1977 industry sales were $6.1 billion. The
estimated annual crude oil throughput was
434 million barrels
Most refineries comply with RACT with the
exception of 5 uncovered wastewater separators
7,583 tons per year
Vapor control of emissions by piping
emissions to refinery fuel gas system or
flare and covering wastewater separators
Vapor control of emissions from process
unit to refinery fuel gas system, cover
wastewater separators and piping emissions
from process units to flare.
Discussion
$473,000
$132,000
No major impact
With recovery of emissions—no change in
energy. Assuming full recovery of emissions
-—net savings of 50,000 equivalent barrel?
annually
No major impact
Mo major impact
No major impact
Approximately 400 tons per year
$18 annualized cost/annual ton of VOC
reduction
a. The calculation for determining net savings in barrels of oil:
7,203 tons x 2,000 Ibs x 125,000 btu/gallons
6.1 gallons/pound x 6,000,000 btu/barrel
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 1-15
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS-OF
IMPLEMENTING RACT FOR TANK TRUCK GASOLINE
LOADING TERMINALS IH ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Discussion
1977 industry sales were $986 million. The
estimated annual throughput was 2.321 billion
New terminals will be designed with vapor
recovery equipment
22,630 tons per year
Submerge or bottom fill and vapor recovery
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized credit (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after control
Cost effectiveness of control
Discussion
$10.42 million
$0.930 million (approximately .09 percent of
value of shipment
No change in price
Assuming full recovery of gasoline—net saving,
of 139,000 barrels annually from terminal
emissions
No major impact
No direct impact
No direct impact
Gasoline credit from vapors from bulk gasoline
plants and gasoline service stations require
uniform RACT requirements throughout the
state
2,300 tons per year
$45 annualized credit/annual ton of VOC
reduction from terminals assuming gasoline
credit from vapors returned from bulk gasoline
plants and gasoline service stations
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-16
U.S. Environmental PiuLccL-O - 7 • r-:\--'
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR BULK GASOLINL
PLANTS IN ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Discussion
1,100
1977 industry sales were $527 million. The
estimated annual throughput was 1.24 billion
gallons
Only small percent of industry has new/
modernized plants
11,500 tons per year
Bottom fill and vapor balancing (cost analysis
reflects top submerged fill, not bottom fill1.
Assumed method of control to meet
RACT guidelines
Top submerged fill and vapor balancing
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Discussion
$15.77 million
$4.32 million (approximately 0.8 percent of
value of shipment)
Assuming a "direct cost pass through"
Industrywide—$0.0034 per gallon increase
Small operations—$0.005 to $0.01 per
gallon increase
Assuming full recovery of gasoline—net savings
of 62,000 barrels annually
No major impact
No direct impact, however for plants closing,
potential average of 4.6 jobs lost per plant
closed
Market structure
RACT timing requirement (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Regulation could further concentrate a
declining industry. Many small bulk gas
plants today are marginal operations; further
cost increases could result in plant
closings
Potential equipment availability problem
Severe economic impact for small bulk plant
operations. Regulation could cause further
market imbalances. Technical feasibility
of cost effective alternatives has not been
effectively demonstrated
3,700 tons per year (32 percent of current
emissions level)
$555 annualized cost/annual ton of VOC
reduction
Source: Boo2, Allen & Hamilton Inc.
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Current Situation
Number of potentially affected
facilities
Indication of relative impor-
tance of industrial section to
state economy
Current industry technology
trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost
(statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emissions after control
Cost effectiveness of control
EXHIBIT 1-17
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR GASOLINE SERVICE
STATIONS IN THE STATE OF ILLINOIS
Discussion
An estimated 19,675 gasoline dispensing facilities
are located in the statp 15,540 are expected to
be potentially affected.
Industry sales are $2.75 billion with a yearly
throughput of 5.435 billion gallons
Number of stations has been declining and throughput
per station has been increasing. By 1980, one-half
of stations in U.S. will be totally self-service
48,900 tons per year from all station operations
Submerged fill and vapor balance
Discussion
$14.7 million
$3.7 million (approximately 0.14 percent of the
value of gasoline sold)
Assuming a "direct cost pass-through"—approximately
$.001 per gallon increase
Assuming full recovery of gasoline—net savings of
124,000 barrels annually
No major impact
No major impact
Compliance requirements may accelerate the industry
trend towards high throughput stations (i.e., mar-
ginal operations may opt to stop operations)
Older stations face higher retrofit costs—potential
concerns are dislocations during installation
30,700 tons per year from all station operations
$203 annualized cost/annual ton of VOC reduction
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-18
U.S. Environmental Protection Acerjcy
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR USE OF CUTBACK AS?-
IN THE STATE OF ILLINOIS
Current Situation
Use of potentially affected asphalt
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of control to meet
RACT guidelines
Discussion
In 1977, estimated use of cutback asphalt
was 269,000 tons
1977 sales of cutback asphalt were
estimated to be $24.8 million
Nationally, use of cutback asphalt has
been declining
49,000 tons annually
Replace with asphalt emulsions
Replace with asphalt emulsions
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualizefl cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$0.2 million
No change in paving costs are expected
No change in paving costs are expected
No major impact
No major impact
No major impact
No major impact
Long range supply of asphalt emulsions
are expected to be available
Winter paving
Short range supply of asphalt emulsions
Net VOC emission reduction is estimated
to be 49,000 tons annually (assuming no
further use of cutback asphalt)
$0 annualized cost/annual ton of VOC
reduction
Source: Booz, Allen 6 Hamilton Inc.
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2.0 INTRODUCTION AND OVERALL STUDY APPROACH
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2.0 INTRODUCTION AND OVERALL STUDY APPROACH
This chapter presents an overview of the study's purpose,
scope, methodology and quality of estimates. This chapter
is divided into six sections:
Background
Purpose of the contract effort
Scope
Approach
Quality of estimates
Definitions of terms used.
The approach and quality of the estimates are discussed
in detail in the respective chapters dealing with the speci-
fic RACT industrial categories (Chapters 3 through 17).
2-1
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2.1 BACKGROUND
To reduce volatile organic compound (VOC) emissions from
stationary sources, the U.S. Environmental Protection Agency
(EPA) is developing a series of emission limitations based
on application of control technology. These regulations are
meant to guide the states in revising their State Implementa-
tion Plan (SIP) to achieve the mandated National Ambient Air
Quality Standards for oxidants. The Clean Air Act Amendments
of 1977 require that each state submit a SIP revision to EPA
by January 1, 1979 for approval by July 1, 1979.
Specifically, the EPA requires that the oxidant plan
submissions for major urban areas should contain regulations
to reflect the application of Reasonably Available Control
Technology (RACT) to stationary sources for which the EPA
has published guidelines. Recommended VOC limitations repre-
sentative of RACT have been prepared for the following indus-
trial categories.
Control Of Volatile Organic Emissions From Existing
Stationary Sources—Surface Coating Of:
Cans
Coils
Paper
Fabrics
- Automobiles
Light-Duty Trucks
- Metal Furniture
Insulation Of Magnet Wire
Large Appliances
Control Of Volatile Organic Emissions From Solvent
Metal Cleaning
.Control Of Refinery Vacuum Producing Systems,
Wastewater Separators And Process Unit Turnarounds
Gasoline Marketing—Control Of:
Tank Truck Gasoline Loading Terminals
Volatile Organic Emissions From Bulk
Gasoline Plants
Volatile Organic Emissions From Storage
Of Petroleum Liquids In Fixed-Roof Tanks
Service Stations—Stage I
Control Of Volatile Organic Compounds From Use Of
Cutback Asphalt.
2-2
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Under the direction of Region V, the EPA commissioned ~. oz,
Allen and Hamilton Inc. (Booz, Allen) to determine the ecopc~ic
impact of implementing RACT standards in four states:
Illinois
Michigan
Ohio
Wisconsin.
The assignment was initiated on June 1, 1978, and the
research stage of the project was completed over a three-month
to four-month period, depending on the individual state require-
ments. A report was issued for each of the four states being
studied.
2-3
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2.2 PURPOSE OF THE CONTRACT EFFORT
To determine the economic impact of implementing RACT
standards for industrial categories in four states (Illinois,
Michigan, Ohio and Wisconsin) of Region V of the U.S.
Environmental Protection Agency. These studies will be used
primarily to assist EPA and state decisions on achieving the
emission limitations of the RACT standards.
2-4
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2.3 SCOPE
The primary task of this project is to determine the costs
and impact of control to achieve RACT guideline limitations. The
impact must be addressed for each industry and for each state so
that the respective studies are applicable to individual state
regulations. Direct economic costs and benefits that can be
realized from RACT implementation shall be identified and quan-
tified. While selected secondary (social, energy and employment)
impacts are to be addressed, they are not to be the major emphasis
in the study. In summary, an economic impact will be analyzed for
each of the industry categories in each state and the economic
impact of the RACT guidelines will be aggregated statewide.
In Illinois, the economic impact is assessed for the
following fifteen RACT industrial categories:
Surface coating of cans
Surface coating of coils
Surface coating of paper
Surface coating of fabrics
Surface coating of automobiles and light
duty trucks
Surface coating of metal furniture
Surface coating for insulation of magnet wire
Surface coating of large appliances
Solvent metal cleaning
Refinery vacuum producing systems, wastewater
separators and process unit turnarounds
Bulk gasoline terminals
Bulk gasoline plants
Storage of petroleum liquids in fixed roof tanks
Service Stations—Stage I
Use of cutback asphalt.
In the determination of the economic impact of the RACT
guidelines, the following are the major study guidelines:
The emission limitations for each industrial
category were studied at the control level
established by the RACT guidelines. These are
presented in Exhibit 2-1, on the following page.
2-5
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Category
EXHIBIT 2-1 11)
U.S. Environmental Protection Agency
LISTING OF EMISSION LIMITATIONS THAT REPRESENT
THE PRESUMPTIVE NORM TO BE ACHIEVED THROUGH
APPLICATION OF RACT FOR FIFTEEN INDUSTRY CATEGOME
RACT Guideline Emission Limitations5
Surface Coating Categories Based on
Low Organic Solvent Coatings (Ibs.
solvent per gallon of coating, minus
water)
Surface Coating Of:
Cans
. Sheet basecoat (exterior and interior)
Overvarnish
Two-piece can exterior (basecoat and overvarnish)
. Two and three-piece can interior body spray
Two-piece can exterior end (spray or rollcoat)
. Three-piece can side-seam spray
. End sealing compound
Coils
. Prime and topcoat or single coat
Paper
Fabrics and vinyl coating
. Fabric
. Vinyl
Automobiles and Light Duty Trucks
. Prime application, flashoff and oven
. Topcoat application, flashoff and oven
. Final repair application, flashoff and oven
Metal Furniture
. Prime and topcoat or single coat
Magnet Wire
Large appliance
. Prime, single or topcoat
Solvent Metal Cleaning
Cold cleaning
Conveyorized degreaser
Open top degreaser
Petroleum Refinery Sources
. Vacuum producing systems
2.8
4.2
5.5
3.7
2.6
2.9
2.9
3.8
1.9
2.8
4.8
3.0
1.7
2.8
Provide cleaners with: cover; facility
to drain clean parts; additional free-
board; chiller or carbon absorber.
Follow suggested procedures to minimize
carryout.
Provide cleaners with: refrigerated chiller
or carbon adsorption system; drying tunnel
or rotating basket; safety switches; covers
Follow suggested procedures to minimize
carryout.
Provide cleaner with: safety switches;
powered cover; chiller; carbon absorber.
Follow suggested procedures to minimize
carryout.
No emissions of any noncondensible voc
from condensers, hot wells or accumulators
to a firebox, incinerator or boiler.
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EXHIBIT 2-1(2)
U.S. Environmental Protection Agency
Category
RACT Guidelines Emission Limitations8
Kastewater separators
Process unit turnaround
Bulk Gasoline Terminals
Bulk Gasoline Plants
Storage of Petroleum Liquids in Fixed
Roof Tanks
Service Stations (Stage I)
Minimize emissions of VOC by providing
covers and seals on all separators and
forebays and following suggested operating
procedures to minimize emissions
Minimize emissions of VOC by depressurizatii
venting to vapor recovery, flare or firebox
No emissions of VOC from a process unit
or vessel until it's internal pressure
is 136 kilo pascals (17.7 psia) or less
Equipment such as vapor control system
to prevent mass emissions of VOC from
control equipment to exceed 80 milligrams
per liter (4.7 grains per gallon) of gaso-
line loaded
Provide submerged filling and vapor bal-
ancing so that VOC emissions from control
equipment do not exceed 80 milligrams
per liter (4.7 grains per gallon) of
gasoline loaded
Provide single seal and internal floating
roof to all fixed roof storage vessels
with capacities greater than 150,000
liters (39,000 gal.) containing volatile
petroleum liquids for which true vapor
pressure is greater than 10.5 kilo
Pascals (1.52 psia)
Provide submerged fill and vapor balance
for any stationary storage tank located
at a gasoline dispensing facility
Use of Cutback Asphalt
The manufacture, mixing, storage, use
or application may be approved where:
long-life stockpile storage is necessary;
the use or application is an ambient tem-
perature less than 10°C (50°F) is necessary;
or it is to be used solely as a penetrating
prime coat
Note: An alternative scenario to the recommended RACT guidelines for surface coating
of automobiles is also studied. It assumes that requirements are modified
to meet specific technologies.
a. Annotated description of RACT guidelines
Souice; Regulatory Guidance for Control of Volatile Organic Compound Emissions from 15
Categories of Stationary Sources, U.S. Environmental Protection Agency, EPA-90512-
78-001, April 1978.
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The t iining reuuir orient for iinp] >• ;r,entat iur, of
controls to meet RACT emission limitations was
January 1, 1982.
All costs and emission data were presented
for 1977.
Emissions sources included were existing
stationary point sources in the applicable
industrial categories with VOC emissions greater
than 3 pounds in any hour or 15 pounds in any day.
The impact of each of the RACT guidelines
was studied statewide (i.e., attainment areas,
nonclassified areas and other areas that
might not be regulated to the guidelines
stated above are included in this analysis).
The following volatile organic compounds were
exempted:
Methane
Ethane
Trichlorotriflorethane (Freon 113)
1,1,1-trichloroethane (methyl chloroform).!
The cost of compliance was determined from the
current level of control (i.e., if an affected
facility currently had an incinerator in place,
the cost of compliance and resulting VOC emission
reduction are not included in this analysis)»
iThe exemption status of methyl chloroform under these
guidelines may be subject to change.
2-6
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2.4 APPROACH
This section describes the overall approach and methodology
applied in this assignment. In general, the approach varied
for each state and also for each industrial category studied.
This section specifically describes the overall approach that
was applied for the state of Illinois. The methodology applied
to determine the economic impact for each of the fifteen RACT
industrial categories in Illinois is described in further
detail in the first section of each chapter dealing with the
specific RACT category.
There are four parts to this section to describe the
approach for determining estimates of:
Industry statistics
VOC emissions
Process descriptions
Cost of controlling VOC emissions.
2.4.1 Industry Statistics
The assembly of economic and statistical data for each
industrial category was an important element in establishing
the data base that was used for projection and evaluation of
the emissions impact. Some of the major variables for each
industrial category were:
Number of manufacturers
Number of employees
Value of shipments
Number of units manufactured
Capital expenditures
Energy consumption
Productivity indices
Current economic (financial) status
Industry concentration
Business patterns (small vs. large; downstream integration)
Age distribution of facilities
Future trends and developments.
Some of the industrial categories studied cover a large
number of potentially affected facilities. For these cate-
gories, industry statistical data were collected by applying a
categorical approach rather than by attempting to identify all
the individual firms likely to be affected. The industrial
categories studied by this approach included:
Solvent metal cleaning
Bulk gasoline plants
Storage of petroleum liquids in fixed roof tanks.
2-7
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For these industrial categories, secondary data sources
and nonconfidential Booz, Allen files served as the primary
resources for the data base. Industry and association
interviews were then conducted to complete, refine and
validate the industry statistical data base.
For the eight surface coating RACT industry categories
studied (cans, coils, paper, fabrics, automobiles and light
duty trucks, metal furniture, magnet wire and large appliances)
the number of facilities potentially affected was in a manageable
range (generally less than 30 facilities per RACT industrial
category); therefore, a more deliberate approach was applied:
As a first step, the facilities potentially af-
fected by the RACT guidelines were identified from
both the Illinois emission data and secondary
data sources.
These two independently compiled lists were
then correlated to identify the facilities
potentially affected but not listed as VOC
emitters in the Illinois emission data.
The Booz, Allen study team then performed
telephone interviews with a sampling of the
facilities identified where there was doubt
concerning inclusion. (For industrial
categories where only a few facilities were
identified, such as coil coating, all the
potentially affected facilities were contacted.)
Industry category statistical data were compiled
using secondary sources such as:
Department of Commerce
- Census of Manufactures
Trade associations
Bureau of Labor Statistics
National Technical Information Services.
The industry statistical data were refined by two
mechanisms:
Assessing the statistical data for reason-
ableness in comparison to the list of po-
tentially affected facilities
Using industry and association interviews for
completion and validation.
2-8
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2.4.2 VOC Emissions
An approach that made maximum utilization of the
existing Illinois emission data was defined.
State EPA representatives were interviewed to
determine the completeness and validity of emis-
sion data available for each RACT industrial
category. It was determined that:
- VOC emission data for major industrial
sources appeared to be reasonable.
- The emission data provided relevant data
that could be utilized for economic evaluation,
i.e., current emission levels (controlled and
uncontrolled emissions) and number of sources
(total and those controlled), type of control
implemented (if any) and average efficiency
of control.
The data base was not compiled in a baseline
consistent with the RACT industrial categories.
The Illinois EPA provided data for relevant industrial
categories. These RACT industrial categories in-
cluded:
Cans
Coils
Fabrics
Paper
Automobiles and light duty trucks
Metal furniture
Magnet wire
Large appliances
- Fixed roof tanks.
For the other RACT categories to be studied, the
emissions were estimated by applying relevant
factors (VOC emissions per facility, thruput,
etc.) that had been developed by EPA studies.
Although this categorical approach cannot be
validated to the degree of a point source by point
source approach, the emissions can be reasonably
estimated on a statewide basis because of the
large number of sources in each RACT industrial
category. Emissions were estimated by this
approach for the following RACT industrial categories:
Bulk gasoline plants
- Bulk gasoline terminals
Refinery systems
Solvent metal cleaning
Service stations
- Cutback asphalt.
2-9
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The emission estimates for each of the fifteen RACT
industrial categories studied were refined during
industry interviews.
2.4.3 Process Descriptions
For each of the industrial categories, the basic
technology and emission data were reviewed and summarized
concisely for subsequent evaluation of engineering alter-
natives. In this task, the RACT documents that had been
prepared for each industrial category and other air pol-
lution control engineering studies served as the basis for
defining technological practice. Additional alternatives to
control that met the requirements of the RACT guidelines were
identified from literature search. The most likely control
alternatives were assessed and evaluated by:
Technical staff at Booz, Allen
Interviews with industry representatives
Interviews with EPA representatives
Interviews with equipment manufacturers.
2.4.4 Cost of Controlling VOC Emissions
The cost of control to meet the requirements of the
RACT guidelines had been presented in the RACT documents,
other technical EPA studies and trade journal technical docu-
ments and by industry representatives. The approach applied
in developing capital and annualized cost estimates was to:
Utilize available secondary source information as
the primary data source.
Validate the control alternatives industry is
likely to apply.
Calibrate these cost estimates provided in tech-
nical documents.
It was not within the purpose or the scope of this
project to provide detailed engineering analyses to estimate
the cost of compliance.
Cost data presented within the body of the report were
standardized in the following manner:
All cost figures are presented for a base year,
1977.
2-10
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Capital cost figures represent installed equipment
cost including:
Engineering
- Design
Materials
Equipment
Construction.
The capital cost estimates do not account for costs
such as:
Clean-up of equipment
Lost sales during equipment downtime
Equipment startup and testing
Initial provisions (spare parts).
Capital related annual costs are estimated at 25
percent of the total capital cost per year (unless
explicitly stated otherwise). The estimation pro-
cedure applied was built up from the following factors
Capital recovery factor for interest and
depreciation of 16.3 percent, based on a
10 percent interest rate and 10 year life
of equipment.1
1 Depreciation and interest charges are based on a formula
supplied by EPA for an equal payment series capital recovery
factor:
A - P I i(l -I- i)n
where:
A » annualized charge for depreciation and interest
"P « initial amount invested
i « annual interest rate
n - life of investment in years
For the current study, the interest rate (i) is assumed to
be 10 percent, based on guidance provided by EPA. Investment
life (n) is assumed to be 10 years. This is based on figures
used in other studies, generally ranging from 10 to 12 years.
The lower figure was selected as most applicable because, with
retrofit situations, the useful life of the equipment is affected
both by its own life and by the remaining life of the system to
which it is added. When major modifications would be required
to a processing line (such as automobile assembly plants) that
would affect the useful life of the facility, a lower investment
life should be applied.
2-11
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Maintenance--4 to 5 percent
Taxes and insurance--4 percent.
The capital-related annual costs do not account
for investment costs in terms of return on invest-
ment parameters (i.e., the "opportunity cost" of
money is not included).
Annual operating costs of compliance with the
RACT guidelines were estimated for each of the
control alternatives studied. The annual oper-
ating costs included were:
Direct labor
- Raw material costs (or savings)
Energy
Product recovery cost (or savings).
Other types of costs, not included in this analysis,
involve compliance costs, such as:
Demonstration of control equipment
efficiency
Supervisory or management time
Cost of labor or downtime during
installation and startup.
The annualized cost is the summation of the
annual operating costs and the capital related
annual costs.
2.4.5 Comparison of Direct Cost with Selected Direct
Economic Indicators
In each of the industrial categories studied, after the
costs (or savings) of compliance had been determined, these
costs were compared with selected economic indicators. This
comparison was performed to gain a perspective on the com-
pliance costs rather than to estimate price changes or other
secondary effects of the regulation. Presented below are
typical comparisons of direct costs with indicators that are
presented in this study.
Annualized cost in relation to current price—To
gain a perspective on the compliance cost in re-
lation to current prices of the manufactured items
at the potentially affected facilities, the annu-
alized cost is presented in terms of a price in-
crease assuming a direct pass-through of costs to
the marketplace.
2-12
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This analysis was based on the average cost
change (including those facilities that may
have little or no economic impact associated
with meeting the proposed standards) divided
by the average unit price of goods manufac-
tured.
For this reason as well as many others (that
might be addressed in a rigorous input-output
study to estimate eventual price increase),
this analysis should not be interpreted as a
forecast of price changes due to the proposed
standards.
Annualized costs as a percent of current value of
shipment—The annualized costs applied are for all
those facilities potentially affected divided by
the estimated value of shipments for the statewide
industrial category (i.e., including those facili-
ties which currently may meet the proposed stand-
ard) . This approach tends to understate the effect
to those specific firms requiring additional ex-
penses to meet the proposed standard. Therefore,
when available, the compliance cost is also pre-
sented as a percent of the value of shipments for
only those firms not currently meeting the pro-
posed regulation.
Capital investment as a percent of current annual
capital appropriations—Estimated statewide capital
investment for the potentially affected facilities
divided by the estimated capital appropriations for
the industry affected as a whole in the state (in-
cluding those facilities that may not require any
capital investment to meet the proposed standard).
2.5 QUALITY OF ESTIMATES
The quality of the estimates that are presented in this
report can be judged by evaluating the basis for estimates
of the individual study components. In each of the chapters
that deal with the development of estimated compliance cost,
the sources of information are fully documented. In addition,
the study team has categorically ranked the overall data qual-
ity of the major sources and, therefore, of the outcomes. These
data quality estimates were ranked into three categories:
High quality ("hard data")—study inputs
with variation of not more than + 25 per-
cent
2-13
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Medium quality ("extrapolated data")—study
inputs with variation of + 25 to + 75 percent
Low quality ("rough data")—study inputs with
variation of + 50 to + --150 percent.
Each of these data quality estimates are presented in
the individual chapters. The overall quality ranking of the
study inputs for each RACT industrial category was generally
in the medium quality range.
12-14
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2.6 DEFINITIONS OF TERMS
Listed below are definitions of terms that are used
in the body of the report:
Capture system—the equipment (including
hoods, ducts, fans, etc.) used to contain,
capture, or transport a pollutant to a
control device.
Coating applicator—an apparatus used to
apply a surface coating.
Coating line—one or more apparatuses or
operations which include a coating appli-
cator, flash-off area and oven, wherein
a surface coating is applied, dried and/
or cured.
Control device—equipment (incinerator,
adsorber or the like) used to destroy
or remove air pollutant(s) prior to dis-
charge to the ambient air.
Continuous vapor control system—a vapor
control system that treats vapors displaced
from tanks during filling on a demand basis
without intermediate accumulation.
Direct cost pass-through—the relationship
of the direct annualized compliance cost
(increase or decrease) to meet the RACT
limitations in terms of units produced
(costs per unit value of manufactured goods.)
Emission—the release or discharge, whether
directly or indirectly, of any air pollutant
into the ambient air from any source.
Facility—any building, structure, installa-
tion, activity or combination thereof which
contains a stationary source of air contam-
inants .
Flashoff area—the space between the appli-
cation area and the oven.
Hydrocarbon—any organic compound of carbon
and hydrogen only.
12-15
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Incinerator—a combustion apparatus designed
for high temperature operation in which solid,
semisolid, liquid or gaseous combustible
wastes are ignited and burned efficiently
and from which the solid and gaseous residues
contain little or no combustible material.
Intermittent vapor control system—a vapor
control system that employs an intermediate
vapor holder to accumulate vapors displaced
from tanks during filling. The control
device treats the accumulated vapors only
during automatically controlled cycles.
Loading rack—an aggregation or combination
of gasoline loading equipment arranged so
that all loading outlets in the combination
can be connected to a tank truck or trailer
parked in a specified loading space.
Organic material—a chemical compound of
carbon excluding carbon monoxide, carbon
dioxide, carbonic acid, metallic carbides
or carbonates, and ammonium carbonate.
Oven—a chamber within which heat is used
to bake, cure, polymerize and/or dry a
surface coating.
Prime coat—the first film of coating
applied in a two-coat operation.
Reasonably available control technology
(RACT)—the lowest emission limit as defined
by EPA that a particular source is capable
of meeting by the application of control
technology that is reasonably available
considering technological and economic
feasibility. It may require technology
that has been applied to similar, but not
necessarily identical, source categories.
Reid vapor pressure—the absolute vapor
pressure of volatile crude oil and volatile
nonviscous petroleum liquids, except liqui-
fied petroleum gases, as determined by
American Society for Testing and Materials,
Part 17, 1973, D-323-72 (Reapproved 1977).
Shutdown—the cessation of operation of
a facility or emission control equipment.
12-16
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Solvent—organic material which is
liquid at standard conditions and which is
used as a dissolver, viscosity reducer or
cleaning agent.
Standard conditions—a temperature of 20°C
(68°F) and pressure of 760 millimeters of
mercury (29.92 inches of mercury).
Startup—the setting in operation of a source
or emission control equipment.
Stationary source—any article, machine,
process equipment or other contrivance from
which air pollutants emanate or are emitted,
either directly or indirectly, from a fixed
location.
Topcoat—the final film of coating applied
in a multiple coat operation.
True vapor pressure—the equilibrium partial
pressure exerted by a petroleum liquid as
determined in accordance with methods described
in American Petroleum Institute Bulletin 2517,
"Evaporation Loss from Floating Roof Tanks,"
1962.
Equivalent barrel of oil—energy demand is
converted into barrels of oil at the conver-
sion rate of 6,000,000 BTU per barrel of
oil.
Vapor collection system—a vapor transport
system which uses direct displacement by the
liquid loaded to force vapors from the tank
into a vapor control system.
Vapor control system—a system that prevents
release to the atmosphere of at least 90
percent by weight of organic compounds in
the vapors displaced from a tank during
the transfer of gasoline.
Volatile organic compound (VOC)—any compound
of carbon that has a vapor pressure greater
than 0.1 millimeters of mercury at standard
conditions excluding carbon monoxide, carbon
dioxide, carbonic acid, metallic carbides
or carbonates and ammonium carbonate.
12-17
-------
-------
3.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
CAN MANUFACTURING PLANTS
IN THE STATE OF ILLINOIS
-------
-------
3.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
CAN MANUFACTURING PLANTS
IN THE STATE OF ILLINOIS
This chapter presents a detailed economic analysis of
implementing RACT controls for can manufacturing plants in the
State of Illinois. The chapter is divided into five sections:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic implications
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of can
manufacturing plants, interviews and analysis.
3.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for can manufacturing plants in Illinois.
The quality of the estimates is described in detail in
the latter part of this section.
3-1
-------
3.1.1 Industry Statistics
Industry statistics on can manufacturing plants were
obtained from several sources. All data were converted to
a base year 1977 based on specific scaling factors. The
number of establishments for 1977 was based on the Illinois
Emission Inventory and supplemented by a review of the 1976
County Business Patterns and interviews with selected can
manufacturing corporations. The number of employees was
obtained from the 1976 County Business Patterns and refined
based on information supplied by the Can Manufacturers
Institute.
The number of cans manufactured was based upon scaling up
1972 published data to 1977.
The 1972 Census of Manufactures reported a total
U.S. volume of shipments of 78 billion units with
a value of $4.5 billion.
The value of shipments in the East North Central
Region was reported as:
Value of Percent of
State Shipments, 1972 U.S. Total
($ Million)
Ohio 236.5 5.24
Illinois 465.9 10.33
Michigan 74.0 1.64
Wisconsin Withheld
Indiana Withheld
7.76
TOTAL 1,126.5 24.97
The value of shipments for 1976 in the U.S. was reported
to be $6,357 million. Based upon the same ratio of
state production to total U.S. production as in 1972,
the 1976 production in the states was estimated to
have been:
1976 Value of Units Produced
State Shipments 1976
($ Million) (Billion)
Ohio 333.3 4.4
Illinois 656.7 8.6
Michigan 104.3 1.4
Wisconsin 304.8 4.0
3-2
-------
For 1977, the Current Industrial Reports indicates that
the increase in production is 3 percent with a 10 per-
cent increase in value of shipments. This factor was
used to estimate 1977 can production and the value
of shipments.
The product mix of the type of cans currently produced
in the state was estimated using the national average
and refined using data obtained from the Illinois Emis-
sion Inventory and from interviews.
3.1.2 VOC Emissions
The data for determining the current level of emissions
from 21 plants was provided by the Illinois Emission Inventory.
These were compared with emissions estimated through the develop-
ment of representative can assembly plants.
3.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for can manufacturing
plants are described in Control of Volatile Organic Emissions
from Stationary Sources, EPA-450/2-77-008. These data provide
the alternatives available for controlling VOC emissions from
can manufacturing plants. Several studies of VOC emission con-
trol were also analyzed in detail, and the industry trade
association and can manufacturers were interviewed to ascertain
the most likely types of control techniques to be used in can manu-
facturing plants in Illinois. The specific studies analyzed were
Air Pollution Control Engineering and Cost Study of General
Surface Coating Industry, Second Interim Report, Spnngborn
Laboratories, and informational literature supplied by the Can
Manufacturers Institute to the state EPA programs.
The alternative approaches to VOC control as presented in
the RACT document were supplemented by several other approaches.
The approaches were arrayed and the emissions to be reduced from
using each type of control were determined. This scheme forms the
basis of the cost analysis, for which the methodology is described
in the following paragraphs.
3.1.4 Cost of Control Approaches and the Resulting Reduction
in VOCs
The costs of VOC control approaches were developed by:
Separating the manufacturing process into discrete
coating operations:
By can manufacturing technology
By type of can manufactured; i.e., beer vs. food
3-3
-------
Determining the alternative approaches to control
likely to be used for each type of coating operation
Estimating installed capital costs for each
approach
Estimating the probable use of each approach to
control considering:
Installed capital cost
Annualized operating cost
- Incremental costs for materials and energy
Technical feasibility by 1981
(This estimate was based on discussions with
knowledgable individuals in the can manufacturing
industry.)
Aggregating costs to the total industry in Illinois.
Costs were determined from analysis of the previously
mentioned studies:
Control of Volatile Organic Emissions from
Stationary Sources, EPA-450/2-77-008
Air Pollution Control Engineering and Cost
Study of General Surface Coating Industry,
Second Interim Report"! Springborn Laboratories
and from informational data supplied by the Can Manufacturers
Institute and from interviews with major can manufacturing
companies.
The cost of compliance and the expected emission reduction
in Illinois were developed based on the plant operational data
(included in the Illinois Emission Inventory) and refined using
interviews with can manufacturers. Based upon the assessment of
the degree and types of controls currently in place, the cost of
VOC emission control and the net reduction in emissions were
estimated.
3.1.5 Economic Impact
The economic impact was analyzed by considering the lead
time requirements needed to implement RACT, assessing the
feasibility of instituting RACT controls in terms of available
technology, comparing the direct costs of RACT control to
various state economic indicators and assessing the secondary
impacts on market structure, employment and productivity from
implementing RACT controls in Illinois.
3-4
-------
3.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls on can manufacturing plants in Illinois. A rating
scheme is presented in this section to indicate the quality of
the data available for use in this study. A rating of "A"
indicates hard data, "B" indicates data were extrapolated from
hard data and "C" indicates data were estimated based on inter-
views, analyses of previous studies and best engineering judg-
ment. Exhibit 3-1, on the following page, rates each study
output and overall quality of the data. However, emission
data are only as good as the assessment of the 1977 technical
approach to emission controls, particularly the degree of
usage of "exempt" solvents and the percentage of solvent
that is actually incinerated.
3-5
-------
Study Outputs
Industry statistics
Emissions
Cost of emissions
control
Statewide costs of
emissions
Overall quality of
data
EXHIBIT 3-1
U.S. Environmental Protection Agency
DATA QUALITY
A B C
"Hard "Extrapolated "Estimated
Data" Data" Data"
Source; Booz, Allen & Hamilton Inc.
-------
3.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business trends
for can manufacturing plants in Illinois are presented in this
section. The source of industry statistics was the Illinois
emissions inventory, The Can Manufacturer's Insitute and the
individual can manufacturing companies. Data in this section
form the basis for assessing the impact of implementing RACT
to VOC emissions from can manufacturing plants in the state.
3.2.1 Size of the Industry
There are approximately 30 major can manufacturing facilities
in Illinois. The Chicago area is one of the largest can manufac-
turing centers in the country. In addition to producing cans to
meet local requirements:
A substantial amount of general purpose cans, such
as paint cans and also aerosol cans are produced
for shipment throughout the midwest.
Coated stock is produced and shipped to other
satellite plants located throughout the midwest.
Exhibit 3-2, on the following page, presents a
summary of can manufacturing facilities in the
state.
The value of industry shipments in 1977 is estimated
at about $800 million:
9.0 billion cans with a value of $720
million
2.0 billion can equivalents of coated
stock with an estimated value of $80
million.
There were an estimated 7,700 employees in 1977. Can industry-1
capital investments were an estimated $15 million to $30
million in 1977, based upon the extrapolation of 1972 data.
3.2.2 Comparison of the Industry to the State Economy
The Illinois can manufacturing industry employs 0.2 per-
cent of the state labor force, excluding government employees.
The state is the second largest producer of cans, after Cali-
fornia, and is the center of can manufacturing in the north
central region.
3.2.3 Characterization of the Industry
The can industry is composed of independent and captive
manufacturers. Nationwide, about 70 percent of all cans are
produced by independent manufacturers and about 30 percent by
captive producers. The majority of captive can producers use
the cans to package canned food/soup and beer. In Illinois,
the independent producers dominate the can production with 80
to 90 percent of the volume.
3-6
-------
EXHIBIT 3-2 (1)
U.S. Environmental Protection Agency
LIST OF METAL CAN MANUFACTURING FACILITIES
POTENTIALLY AFFECTED BY RACT IN ILLINOIS
Name of Firm
American Can Company
American Can Company
Continental Can Company
Continental Can Company
Continental Can Company
Continental Can Company
Continental Can Company
Continental Can Company
Continental Can Company
Continental Can Company
National Can Company
National Can Company
Crown Cork and Seal
Crown Cork and Seal
Crown Cork and Seal
Wisconsin Can Co.
Location
Chicago (Englewood)
Hoopeston
Chicago (Clearing)
Alsip
Chicago (.North Mound)
Chicago (Clearing)
Chicago (Stock yard)
Peoria
Danville
Itasca
Chicago (Clearing)
Chicago (Kedzie)
Chicago
Bradley
Kamkakee
Chicago
Product
3-piece general purpose cans
2-piece food cans
3-piece food cans
3-piece general purpose cans
Can ends
Can coating
3-piece beer and soft drink
assembly
General purpose cans
General prupose cans
Meat cans
3-piece beer and soft drink
3-piece general purpose cans
3-piece general purpose cans
3-piece food cans
3-piece aerosol cans
3-piece beer and soft drink
cans
Notes
The plant is a major coating
facility supplying coated
stock to other plants
Coating and assembly operations
are performed at this plant
The plant is a major coating
facility supplying coated
stock and compounded ends to
other plants
Assembly only
Assembly only
Assembly only
The plant supplies coated stock
to other plants
Assembly only
-------
i I } I J I I t I t i i
EXHIBIT 3-2 (2)
U.S. Environmental Protection Agency
Name of Firm Location
Cambell Soup Company Chicago
Del Monte Corp. Rochelie
General Foods, Culumet Div. Chicago
Libby McNeil K Libby Chicago
Perk Foods Park Ridge
Sherwin Williams Co. Elgin
Armstrong Container Chicago
Central Can Chicago
Clark Manufacturing Company Rockford
EKCO Wheeling
Internation Can Chicago
Olive Can Chicago
Rofkford Can Rockford
Vulcan Containers Hillside
Product
Notes
Source; Booz, Allen and Hamilton Inc; Illinois Emission Inventory.
-------
The independent can producers generally operate on a "job
shop" basis, producing cans for several customers on the same
production facilities. In addition to differences in can
size and shape, there are differences in coatings resulting
from:
The need to protect different products with vary-
ing characteristics from deterioration through
contact with the metal can
The decoration requirements of customers and
requirements for protection of the decoration.
Nationally, the can industry produces more than 600 differ-
ent shapes, types and sizes to package more than 2,500 products.
A relatively few can sizes and coating combinations employed for
packaging beverages and food represent about 80 percent of the
market. The approximate percentage of total can production
represented by the major groups follows.
Percent of
Type of Can Total Production
Beer and soft drink 54
Fruit and vegetable 18
Food cans in the category
that includes soup cans 8
Other 20
TOTAL 100
In Illinois, the can industry is focused on meeting the
needs of the canning industry in the state. Large integrated
plants in the Chicago area are a major source of precoated
stock, general purpose cans and aerosal cans for the north
central region.
The can industry in Illinois produced 9.6 billion cans in
1977, as well as coated stock for an estimated 2 billion cans
that were assembled out of state.
8.6 billion food, general cans and aerosol cans
were produced almost entirely of three-piece
construction.
0.5 billion three-piece beer and soft drink cans
were produced.
0.5 billion beer and soft drink cans were produced
using two-piece construction.
3-7
-------
Stock for 1.0 billion beer and soft drink cans was
coated for shipment to plants in other states.
Stock for 1.0 billion food and general purpose cans was
coated for shipment to plants in other states.
The can industry in Illinois, as well as nationally, has
experienced rapid technological changes since 1970 caused by
the introduction of new can making technology—the two-piece
can. These changes in can manufacturing technology have
resulted in the closing of many can plants producing the
traditional three-piece product and replacing the capacity
with two-piece cans. There is evidence that this trend will
continue, so that by 1981 about 80 percent of the beer and
beverage cans and a relatively small but growing percentage
of other cans will be of two-piece construction.
3-8
-------
3.3 THE TECHNICAL SITUATION IK THE INDUSTRY
This section presents information on can manufacturing
operation, estimated VOC emissions, the extent of current
emission control and the likely alternatives which may be
used for controlling VOC emissions in Illinois.
3.3.1 Can Manufacturing Operations
The can industry produces cans using two fundamental
technologies, the traditional three-piece method and the
newer two-piece technology.
The three-piece can technology consists of two separate
operations: sheet coating and can fabrication (assembly). Sheet
coating and can assembly operations are frequently performed in
separate facilities. The major can manufacturers operate cen-
tralized facilties for the coating and decorating of flat sheets.
These centralized plants are often called "feeder plants." Sheets
are coated at a rate of about 2.5 base boxes per minute, which
is equivalent to approximately 1,250 twelve-ounce cans per
minute. The specific operations in three-piece can manufacture
are summarized below.
Sheets of metal are coated and decorated with
28 or 35 can bodies (outs). This is accomplished
in two steps.
The sheets are base coated on the interior
side and then passed through a wicket oven.
Food cans, as well as some beer and soft drink
cans, are given an exterior base coat.
In the case of beer and soft drink cans,
the base coated sheets are decorated (printed),
over coated with varnish and then cured in a
smaller wicket oven.
Exhibits 3-3 and 3-4, on the following page,
present flow diagrams of the base coating
and decorating operations.
3-9
-------
EXHIBIT 3-3
U.S. Environmental Protection Agency
SHEET BASE COATING OPERATION
IT ACM*
Source; U.S. Environmental Protection Agency
-------
EXHIBIT 3-4
U.S. Environmental Protection Agency
SHEET PRINTING OPERATION
••AIM
0VIMVAMNMI
C0AIM
Source; U.S. Environmental Protection Agency
-------
Can bodies are formed from the coated sheets.
The printed sheets are slit into individual
body blanks and fed into the "body maker."
The blank is rolled into a cylinder and
soldered, welded or cemented.
The seam is sprayed (striped) on the
inside and outside with an air dry lacquer
to protect the exposed metal. Sometimes
this is done only on the inside surfaces.
Can ends are formed from coated sheet stock and
fed to the end seamer where final fabrication is
completed.
Can ends are stamped from coated stock and
perimeter coated with synthetic rubber com-
pound gasketing.
Solvent-based compounds are air-dried and
water-based compounds are oven-dried.
The can is fabricated from the body and the end in an
"end sealer," leak tested and palletized for shipment.
Exhibit 3-5, on the following page, presents a schematic
of can end and three-piece can fabricating operations.
Two-piece cans are generally manufactured in an integrated
high-speed process capable of producing 600 or 800 cans
per minute.
Coil stock is formed into a shallow cup.
The cups are drawn and ironed into the form
of a can.
The cans are washed to remove the lubricant.
An exterior base coat is applied (if required)
by reverse roller coating and cured in a con-
tinuous oven.
The cans are printed and then coated with a
protective varnish. The coating is then baked
in an oven. Steel cans are sometimes given two
separate interior coatings.
3-10
-------
EXHIBIT 3-5
U.S. Environmental Protection Agency
CAN END, AND THtfEE-PIECE BEER AND BEVERAGE
CAN FABRICATING OPERAliON
»»M MClMMt
0W M*V
iriuf
IIMfUlM
Source: U.S. Environmental Protection Agency
-------
The cans are necked, flanged and tested.
The interior of the cans are spray coated
and baked in the oven.
An exterior end spray coating is applied:
For aluminum cans to prevent blocking
For steel cans to prevent rusting.
Exhibit 3-6, on the following page, is a process
diagram of a two-piece can fabricating and coating
operation.
Two-piece cans are largely made from aluminum.
Virtually all aluminum cans are of two-piece
construction.
Aluminum lends itself to two-piece construction,
yet offers no advantage to warrant converting
three-piece can lines to aluminum.
There are a limited number of two-piece steel
can production facilities.
3-11
-------
EXHIBIT 3-6
U.S. Environmental Protection Agency
TWO-PIECE ALUMINUM CAN FABRICATING AND COATING
OPERATION
•Mil
NMMffl
•AMI*
•AltCMflMV
•miMMftAUCMTlft
MflMWI N»V «m»f
IIT! M«« IN* WAV
IIM
tillI •
MC«f«MM
Source: U.S. Environmental Protection Agency
-------
3.3.2 Emissions and Current Controls
The can industry is moving toward products with inherently
lower VOC emissions during manufacture. Differences in the
manufacturing process between two-piece and three-piece cans
allow for a 50 percent to 60 percent reduction in emissions in
converting from a three-piece beer can to a two-piece beer can
decorated in a similar manner. This is caused by a greater
number of interior coating operations for three-piece cans, as
well as a tendency to eliminate certain exterior coatings on
two-piece beer and soft drink cans. The exhibits, on the
following pages, present the emissions from typical can coating
operations based upon average coating properties, can production
rates and annual hours of operation. They present data for
conventional systems, as well as for low solvent systems. It is
important to note that, in most instances, can manufacturing
does not require all the coatings.
Exhibit 3-7 presents VOCs resulting from coating
operations used in the manufacture of two-piece
cans.
Exhibit 3-8 presents VOCs resulting from sheet
coating operations used in the manufacture of
three-piece cans.
Exhibit 3-9 presents VOCs resulting from typical
three-piece can assembly operations.
The emissions from the industry, developed through the
analysis of typical coating operations and the assumed product
mix, total an uncontrolled level of 11,200 tons. Emissions frnrr
producing typical products are included in Exhibits 3-13 and 3-14
under the 1978 base case alternatives.
Can Type Quantity VOC Total VOC
(million) (tons/million) (tons)
2-piece beer and 500 0.67 335
soft drink
3-piece beer and 500 1.79 895
drink
3-piece food and 8,600 0.99
other
Sheet coating 2,000 0.73
TOTAL 11,204
3-12
-------
EXHIBIT 3-7 (1)
U.S. Environmental Protection Agency
EMISSIONS FOR TYPICJU. COATING
OPERATION USED IN THE MAHUFACTURE
OF TWO-PIECE CAMS
Coating Properties
Operation
Organic Systeaa
Print and varnish
Siie and print
White base coat and
print
Interior body spray
End coating Al
End coating steel
Low Sol-rent Systems
Waterbome
Print and varnish
Size and print
White base coat and
print
Interior body spray
End coating Al
End coating steel
UV Cure High Solids
Print and varnish*'
Organic
Density
(Ib./gal.)
0.0
0.0
11.0
7.9
8.0
0.0
0.5
0.5
11.7
0.55
0.5
8.5
8.0
Solids
(wt. t)
45
40
62.5
26
45
45
35
30
62
20
35
35
95
Solvent
(wt. *)
100
100
100
100
100
100
20
20
20
20
20
20
100
(Ib./gal.)
4.40
4.80
4.13
5.85
4.40
4.40
1.11
1.19
0.89
1.37
1.11
1.11
0.40
Water
(gal. /gal.
coating)
0
0
0
0
0
0
0.53
0.57
0.43
0.66
0.53
0.53
0
VOC
(Ib. solvent/
gal. less water)
4.40
4.80
4.13
5.85
4.40
4.40
2.36
2.76
1.55
3.99
2.36
2.36
0.40
VOC
(Ib. solvent/
gal. incl. water)
4.40
4.80
4.13
5.85
4.40
4.40
1.11
1.19
0.88
1.36
1.11
1.11
0.40
Yield
(1000 can/
gal.)
12
20
9
6a
200
40
11
17
8
5"
200
40
25
-------
i i
I i i f
I I
I i
EXHIBIT 3-7 (2)
U.S. Environmental Protection Agency
Operation
Production
(cans/min.)
Organic Syatema
Print and varnish
Sic* and print
white baM coat
and print
Interior body
•pray
End coating Al
Bid coating steel
tow Solvent Systems
Waterborne
Print and varnish
Size and print
Whit* base coat
and print
Interior body
spray
End coating Al
End coating steel
UV Cured High solids
Print and varnlnhb
650
650
650
650
650
650
650
650
650
650
650
650
650
(Million
canm/yr.)
253.5
253.5
253.5
253.5
253.5
253.5
253.5
253.5
253.5
253.5
253.5
253.5
253.5
Coating Consumed
VOC
(gal./hr.)
3.25
1.95
4.33
6.50
0.20
0.98
3.55
2.29
4.89
7.80
0.20
0.98
1.56
(1000 gal./yr.) (Ib./hr.)
21.1
12.7
28.1
42.3
1.3
6.4
23.1
14.9
31.7
50.7
1.3
6.4
10.1
14.3
9.4
17.8
38.0
0.9
4.3
3.9
2.7
4.3
10.6
0.2
1.1
0.6
(tons/yr.)
46.5
30.6
57.9
123.5
2.9
14.0
12.7
B.e
14.0
34.5
0.7
3.6
2.0
(lb./million cans)
364
241
457
974
23
110
100
69
110
272
28
15
a. Assuming 75 percent beer cans, all givan a (ingle coat, and 25 percent soft drink cans, given a double coating
b. Booz, Allen C Hamilton Inc. estimate baaed on data supplied by CHI, individual can manufacturers and the EPA
document 450/2-77-008
Source; Booz, Allen t Hamilton Inc. estimates based on data supplied by Can Manufacturers Institute and interviews
with can companies.
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EXHIBIT 3-8 (1}
U.S. Environnental Protection Agency
COATING AMD PRINTING OPERATIONS USED IN
THE MANUFACTURE OF THREE-PIECE CANS
(Sheet Coating Operation)
Operation
Coating Properties
Conventional Organlcs System
Sizing and print
Inside basecoat
Outside white and print
Outside sheet printing and
varnish
Density
(Ib./gal.)
8.0
8. OS
11.0
8.0
Solids
(wt »)
40
40
62.5
45
Organic
Solvent
(wt %) (Ib./gal.)
100 4.80
100 4.83
100 4.13
100 4.40
Hater
(gal/gal
coating)
0
0
0
0
VOC
(Ib. solvent/
gal. less
water)
4.80
4.83
4.13
4.40
VOC
(Ib. solvent/
gal. including
water)
4.80
4.83
4.13
4.40
Dry Coating Thickness
( Ib.
5
2O
40
10
base box)
0.086
0.346
0.692
0.172
Low Solvent Systems
Sizing (waterborne)
Inside basecoat
High solids
Materborne
Outside white
High solids
Naterborne
Outside sheet print and
varnish (waterborne)
B.S
8.0
8.8
12.0
11.7
8.5
30
80
40
80
62
35
20
100
20
100
20
20
1.19
1.60
1.O6
2.40
0.89
1.11
0.57
0
0.51
0
0.43
0.53
2.76
1.60
2.15
2.40
1.55
2.36
1.19
1.60
1.05
2.40
0.88
1.11
20
20
40
40
10
0.086
0.346
0.346
0.692
0.692
0.172
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EXHIBIT 3-8 (2)
U.S. Environmental Protection Agency
Operation
Conventional Organic* Systems
Siting and print
Inside basecoat
Outside white and print
Outside sheet printing and varnish
Production
(base box (10OO base boxes3
Coating Consumption
VOC
hr.)
150
150
ISO
150
year)
340
240
240
240
(gallon
basebox)
.027
.107
.100
.040
4.1
16.1
15.0
7.2
(1000 gal.
year)
6.6
25.7
24.0
11.5
hour)
19.7
77.8
62.0
31.7
(tons
year)
15.8
62.2
49.6
Ibs
10OO base boxes)
130
517
413
211
tow Solvent Systeas
Siting (waterborne)
Inside basecoat
Nigh solids
Haterborne
Outside white
High solids
Waterborne
Outside sheet print and varnish
(waterborne)
150
150
150
150
ISO
150
240
240
240
240
240
240
.034
5.1
8.1
054
098
072
095
057
8.1
14.7
10.8
14.3
8.6
13.0
23.5
17.3
22.9
13.8
6.1
4.9
41
13.0
15.4
25.9
12.6
9.5
10.4
12.3
20.7
10.1
7.6
87
103
172
841
63
a. Assuming 1,600 hours per year of operation.
Source; Boot, Allen t Hamilton Inc. estimates based on data supplied by CMI and individual can companie
-------
EXHIBIT 3-9 (1)
U.S. Environmental Protection Agency
EMISSIONS OF TYPICAL COATING
OPERATIONS USED IN THREE-PIECE
CAN ASSEMBLY
Coating Properties
Operation Penalty
Ub./gal.)
Organic Systems
Interior body spray
(beer)
Inside stripe
(beer t bev.)
(food)
Outside atrip*
(beer)
End sealing compound
(beer t bev.)
(food)
Low Solvent Sysbeos (water
Interior body spray
(beer)
Inside stripe
(beer C bev.)
(food)
Outside stirpe
(beer)
End sealing compound.
(beer £ bev.)a
(food)8
7.9
B.O
8.0
0.0
7.1
7.1
borne)
B. 55
8.55
8.55
8.55
9.00
9.00
Solids
(wt. %)
26
13.5
13.5
13.5
39
39
20
36
36
36
40
40
Organic
Solvent
(wt. *) (Ib./gal.)
100
100
100
100
100
100
20
20
20
20
3
3
5.85
6.9
6.9
6.9
4.3
4.3
1.37
1.09
1.09
1.09
0.16
0.16
Water
(gal. /gal.
coating)
0
0
0
0
0
0
0.66
0.53
0.53
0.53
0.63
0.63
VOC
(Ib. solvent/
gal. less water)
5.85
6.92
6.92
6.92
4.33
4.33
3.99
2.30
2.30
2.30
0.43
0.43
VOC
(Ib. solvent/
gal. incl . water)
5.85
6.92
6.92
6.92
4.33
4.33
1.36
1.08
1.08
1.08
0.16
0.16
Yield
(1000 can/
gal.)
4
70
70
50
10
10
5
70
70
45
10
10
-------
i i
EXHIBIT 3-9 (2)
U.S. Environmental Protection Agency
Operation
Productionb
Coating Consumed
(cans/ain.)
Organic Systems
Interior body 400
spray (beer)
Inside stripe
(beer S bev.) 400
flood) 400
Outside stripe 400
(beer)
Old sealing
compound
(beer « bev.) 400
(food) 400
Low Solvent System*
(Waterborne)
Interior body 400
spray (beer)
Inside stripe
(beer t bev.) 400
(food) 400
Outside stripe 4OO
(beer)
Bid sealing
compound
(beer C bev.)* 400
(food)" 400
(Million
cans/yr.)
120
120
72
120
120
72
120
120
72
120
120
72
(gal./hr.)
6.00
O. 3O
O. 3O
0.48
2.40
2.40
4.8
0.30
0.30
0.53
2.40
2.40
(1000 gal./yr.)
30.0
1.5
O.9
2.4
12.0
7.2
24.0
1.5
0.9
2.6
12.0
7.2
voc
(Ib./hr.)
35.1
2.1
2.1
3.3
10.4
10.4
6.5
0.3
0.3
0.6
0.4
0.4
(tons/yr.)
B7.8
5.3
3.2
8.3
26.0
15.6
16.3
0.8
0.5
1.5
1.0
0.6
(Ib. /mill ion cans
1,463
88
en
138
433
433
272
13
13
25
17
17
a. Waterborne systems are currently only used on aerosol and oil cans.
b. Assumes 4,000 hours per year, as an average of 3,000 hours for food cans and 5,000 hours for boer and beverage cans.
Source; Booz, Allen t Hani1ton Inc. estimates based on data supplied by CMI and individual can companies
-------
3.3.2 Emissions and Current Controls
Exhibit 3-10, on the following page, shows the total
emissions from 21 can manufacturing f a<~i] 3 tie0; to be about
5,900 tons per year. The source of these emission data is the
Illinois Emission Inventory. The data indicate that, at
the present time, in-place controls have reduced emissions
by about 4,200 tons. However, during the interviews with the
can manufacturers, serious questions arose about the accuracy
of the data for certain facilities—the impact of two errors
identified increased 1977 VOC emissions by 1,200 tons per year
to 7,100 tons.
The industry in Illinois is currently controlling emissions
on an estimated 40 percent of the coating throughput. Three
methods are being used to reduce emissions:
The use of exempt solvents as defined by rule 66—
this is not acceptable under RACT
Incineration
Low solvent coatings.
The emissions fro™ the industry developed through the analysis
of typical coating ope r .^ *;: *• r r; and the ass'j^ef prcd-r-t iri x t:'?!1
an uncontrolled level of 11,100 tons—as compared to about
10,100 in the Illinois emissions inventory. An analysis of the
interview notes and the Illinois emissions inventory indicates
that emissions in 1977 were about 8,OCO tons per year—a 25
percent reduction.
3.3.3 RACT Guidelines
The RACT Guidelines for VOC emission control are specified
as the amount of allowable VOC, in pounds per gallon of coating,
minus any water in the solvent system. To achieve this
guideline, RACT suggests the following options:
Low solvent coatings
Waterborne
High solids
Powder coating
Ultraviolet curing of high solids coatings
Incineration
Carbon adsorption.
3-13
-------
EXHIBIT 3-10 (1)
U.S. Environmental Protection Agency
ILLINOIS EMISSION INVENTORY
I.D. No.
031012AAY
Facility Name No. of
Process Sources
Continental Can Co.
Litho coating oven 4
Litho coating oven 2
No. of
Sources
with
Controls
0
2
Type of
Control
Average
Control
Efficiency
(Percent)
0
catalytic 92
incinerator
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
562
41
Potential
Control
Efficiency
(percent)
90
-
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
505
-
Litho decorating
press line/oven
Solder pot, inside/
outside stripe
End comp. lining
units
water base 100
153
75
90
90
138
68
031186AAR Continental Can Co.
Lacquer spray
machine
Bank
Inside coating oven
1
1
0
0
0
0
67
42
17
90
90
90
60
38
15
-------
EXHIBIT 3-10 (2)
U.S. Environmental Protection Agency
I.D. No.
Facility Name
Process
No. of
Sources
No. of
Sources
with
Controls
Type of
Control
Average
Control
Efficiency
(Percent)
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
Potential
Control
Efficiency
(percent)
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
031438AAN Sherwin Williams Co.
Coating line #1 and 2
424
90
382
Fringing line #3
and 14
Soldering Flux
209
33
90
90
188
30
031600ACP Central Can Co.
Litho baking oven
26
90
23
031600ACY Continental Can Co.
Coater and oven C7, 3
C8, C9
Coater and oven 6
Solder pot, inside/ 21
outside stripe
Litho press and 8
oven
End comp. lining 12
and oven
0
0
1 catalytic
incinerator
95
0
0
288
331
173
60
90
90
90
90
259
298
156
54
-------
t i I 1 I t
EXHIBIT 3-10 (3)
U.S. Environmental Protection Agency
I.D. No.
031600AID
Facility Name No. of
Process Sources
Campbell Soup Co.
Can end lining 16
Coating oven 2
No. of
Sources
with
Controls
0
2
Average
Control
Type of Efficiency
Control (Percent)
0
afterburner 90
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
320
Potential
Control
Efficiency
(percent)
90
Potential
Emission
Reduction
Thru RACT
(Tons/Yr . )
288
031600AQM American Can Co.
Compound liner/ 76
dryer
Side seam 18
Coating oven 8
Litho press oven 9
U.V. oven 3
0
8
9
3
3 afterburners* 90
S 5 catalytic inc.
9 afterburners* 90
U.V. oven 90
701
178
106
110
1
90
90
631
160
(*Permit File indicates these afterburners are not being used.)
-------
EXHIBIT 3-10 (4)
U.S. Environmental Protection Agency
I.D. No.
031600ARM
Facility Name No. of
Process Sources
Continental Can Co.
Ovens 4
Ovens 8
Press lines 13
Cap lining comp. 25
No. of
Sources
with
Controls
4
8
0
0
Average
Control
Type of Efficiency
Control (Percent)
catalytic >85
afterburners
afterburners 95
0
0
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
29
3
255
53
Potential
Control
Efficiency
(percent)
90
90
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
230
48
ovens
Paint spray and
drying booths
11
90
10
031600AYB Wisconsin Can Co.
Coating oven
Lithographic oven
1
1
0
0
0
0
21
8
90
90
19
7
-------
tit!
i 1 i
EXHIBIT 3-10 (5)
U.S. Environmental Protection Agency
I.D. No.
031600BEI
031600BPR
Facility Name No. of
Process Sources
National Can Co.
Inside seam stripe 5
Outside stripe 5
360° body spray 5
Bake oven 4
Libby, McNeil and
Libby Co.
No. of
Sources
with
Controls
0
0
0
0
Average
Control
Type of Efficiency
Control (Percent)
0
0
0
0
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
3
8
8
16
Potential
Control
Efficiency
(percent)
90
90
90
90
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
2
7
7
14
Coater ovens
Incinerator
92
031600BQN Crown Cork and Seal
Press lines - ovens, 4
litho
No. 2 line, oven 2
Stripping baths 10
2
0
afterburner 90
afterburner 90
3
8
90
-------
EXHIBIT 3-10 (6)
U.S. Environmental Protection Agency
I.D. No.
Facility Name No. of
Process Sources
Continental Can Co.
No. of
Sources
with
Controls
Average
Control
Type of Efficiency
Control (Percent)
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
Potential
Control
Efficiency
(percent)
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
Litho coater/ovens
#2, 4, 6, 7
Litho coater/ovens
#9, 10
0
catalytic 87
incinerator
150
21
90
135
Can assembly lines
End compound lines
031821AAB National Can Co.
Coater ovens
Lithograph ovens
Spray machine #13
Seam stripe lines
8
4
2
3
1
7
0
0
2
3
0
0
0
0
afterburner 95
afterburner 95
0
0
5 90
3 90
17
not known -
3 90
31 90
4
2
2
28
-------
EXHIBIT 3-10 (7)
U.S. Environmental Protection Agency
I.D. No.
091020AAW
Facility Name No. of
Process Sources
Crown Cork & Seal
Co., Inc.
Coater oven 1
Printer oven 1
No. of
Sources
with
Controls
0
1
Average
Control
Type of Efficiency
Control (Percent)
0
high solid not known
Current
Average
Hydrocarbon
Emissions
(Tons/Yr . )
0.12
Potential
Control
Efficiency
(percent)
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
Inside/bottom
spray machines
Twin bake oven
12
ink
0
22
27
90
90
20
24
141805AAF Del Monte Corp.
Coater and oven
Coater and oven
Heat sens, paint
2
2
1
0
0
0
0
0
0
151
182
<1
90
90
-
136
164
-
spray
-------
EXHIBIT 3-10 (8)
U.S. Environmental Protection Agency
I.D. No.
143065ABM
183020AFK
18304 5AAA
Facility Name
Process
Continental Can Co.
Inside stripe
Outside stripe
Lacquer spray
Drying oven
Continental Can Co.
Solder lines
LSM-Machine
LSM-Bank
IBO-oven
American Can Co.
Coaters
Compound dryer
No. of
Sources
3
3
3
3
6
1
1
1
2
15
No. of
Sources
with
Controls
0
0
0
0
0
0
0
0
0
0
Average
Control
Type of Efficiency
Control (Percent)
0
0
0
0
0
0
0
0
0
0
Current
Average
Hydrocarbon
Emissions
(Tons/Yr . )
6
19
162
72
25
6
4
2
20Q
7
Potential
Control
Efficiency
(percent)
90
90
90
90
90
90
90
90
90
90
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
5
17
146
65
23
5
3
2
180
6
-------
EXHIBIT 3-10 (9)
U.S. Environmental Protection Agency
I.D. No.
201030ACW
Facility Name
Process
National Can Co.
Inside stripe
Outside stripe
Bake oven
360 body spray
No. of
Sources
No. of with Type of
Sources Controls Control
60
30
30
30
Average
Control
Efficiency
(Percent)
0
0
0
0
Current
Average
Hydrocarbon
Emissions
(Tons/Yr.)
7
8
9
6
Potential
Control
Efficiency
(percent)
90
90
90
90
Potential
Emission
Reduction
Thru RACT
(Tons/Yr.)
6
7
8
5
201030AOI Clark Mfg. Co.
Coating oven, PI,
2, 6
Coating oven, Cl,
4, 5, 6
Coaters
TOTALS
0
441
2
77
afterburner 95
afterburner 95
231
67
8
5,864
90
210
4,847
Note 1: Total uncontrolled number of sources = 364
Note 2: Total uncontrolled current average HC emissions - 5,389 tons/yr.
Sourcet Illinois Environmental Protection Agency.
-------
The RACT guidelines have established different limitations
for each of four groups of can coating operations. Exhibit
3-11, on the following page, presents the recommended VOC
limitations, compared with typical, currently available, conven-
tional coatings.
3.3.4 Selection of the Most Likely RACT Alternatives
Projecting the most likely industry response for control
of VOC emissions in can manufacturing facilities is complicated
by the thousands of different products offered by the can
industry. Based on industry interviews, several general assump-
tions can be made regarding the industry in Ohio as well as nation-
ally.
The industry preferred response will be to use low
solvent coatings (primarily waterborne) wherever
technically feasible because of their low cost—see
incremental cost comparisons on Exhibits 3-13 and
3-14.
The choice between thermal incinerators
and catalytic incinerators will be based
on the availability of fuel and the pref-
erence of the individual companies.
Incinerators with primary heat recovery
will be used in preference to those with
secondary recovery or no heat recovery.
The industry will not install carbon adsorption
systems because of the very poor performance record
established to date in sever; 1 can plants that have
evaluated this control approach.
Twelve likely control alternatives, as well as the three
base cases, are discussed in the paragraphs below.
The percentage of cans likely to be manufactured by
each of the control option alternatives, by 1982, is
summarized in Exhibit 3-12, following Exhibit 3-11.
The resulting emissions are summarized in Exhibits
3-13 and 3-14, at the end of this section. For
cases involving incineration, the following assump-
tions were made.
Energy cost is $2.25 per million BTUs.
Capital cost is $20,000 per CFM.
Incinerators operate at 10 percent of the lower
explosive limit.
90 percent of the roller coating emissions are
collected and incinerated.
3-14
-------
EXHIBIT 3-11
U.S. Environmental Protection Agency
RACT GUIDELINES FOR CAN COATING OPERATIONS
Coating Operation
Recommended Limitation
kg. per liter
of coating
(minus water)
Sheet basecoat (exterior) 0.34
and interior) and over-
varnish; two-piece can
exterior (basecoat and
overvarnish)
Two- and three-piece can 0.51
interior body spray,
two-piece can exterior
end (spray or roll coat)
Three-piece can side-seam 0.66
spray
End sealing compound 0.44
Ibs. per gallon
of coating
(minus water)
2.6
4.2
5.5
3.7
Typical Currently
Available
Conventional Coatings
Ibs. per gallon
of coating
(minus water)
4.1-5.5
6.0
7.0
4.3
Source: U.S. Environmental Protection Agency
-------
EXHIBIT 3-12
U.S. Environmental Protection Agency
PERCENTAGE OF CANS MANUFACTURED
USING EACH ALTERNATIVE
Low Solvent
Water- Coatings
borne or Thermal Except UV Cured
Other Low Incineration Print Only, End Sealant Outside Varnish
Solvent with Primary All Low Solvent Which Is Waterborne
Can Type Coatings Heat Recovery Coatings Incinerated Inside Spray
2-piece beer 40 10 50 — 0
and soft
drink
3-piece beer 25 20 — 55
and soft
drink
3-piece food 25 20 — 55
and other
cans
Sheet coating 60 40
and end com-
pounding in
feeder plants
of material
to be shipped
for assembly
elsewhere
Source; Boo2, Allen £ Hamilton Inc.
-------
30 percent of the interior spray coating emissions
are collected and incinerated.
The assumptions on cost operating parameters and likely in-
dustry response to each control alternative were based upon dis-
cussions with knowledgeable industry sources and on Air Pollution
Control Engineering and Cost Study of General Surface Coating
Industry, Second Interim Report, Springborn Laboratories.
3.3.4.1 Two-Piece Beer and Soft Drink Cans—1978 Base Case
At the present time, the majority of beer and soft drink
cans produced in Illinois are produced with one exterior coating,
a procedure defined as print and varnish.
The can is printed directly over the base metal
and then varnished using a high solvent organic-
borne varnish—eliminating the base coat.
The interior of the can is sprayed, using a high
solvent interior body spray.
The end of the can is spray coated, using a high
solvent body spray.
In this base case alternative, no incineration is assumed
although, in fact, most of the operations in Illinois currently
incinerate some of the emissions. The coating consumption is
approximately 250 gallons per million cans, resulting in emis-
sions of 0.67 tons per million cans.
3.3.4.2 Two-Piece Beer and Soft Drink Cans—Waterborne
Coatings as Proposed in RACT
In this alternative, all the coating operations
currently employed in the base case have been converted to
waterborne coatings. The cost of converting to waterborne
systems was assumed to be minimal.
The capital cost for converting each of three
coating operations was estimated to be $10,000.
This results in an annualized cost of $30 per
million cans—assuming that the annualized cost
of capital is 25 percent of the total installed
capital cost and that 250 million cans are
produced annually on the coating line.^-
The cost of the coatings is the same as for con-
ventional coatings—industry sources believe that
by 1980 this will be the case.
1 Annualized capital cost includes depreciation, interest,
taxes, insurance and maintenance.
3-15
-------
The energy consumption is the same—this would
appear reasonable since most energy consumed is
used to heat the belt and the metal cans.
The yield (spoilage) is the same—it appears that
the industry will continue to encounter significant
spoilage in changing over to new coatings. However,
as the technology is established, it is assumed
that spoilage will decline to currently acceptable
levels.
The total incremental annualized compliance cost of using
waterborne solvents is estimated to be about $30 per million
cans. This represents a direct cost increase of less than 0.05
percent. The emissions would be reduced to 0.19 tons per million
cans—a 75 percent reduction at a cost of about $62 per ton
of VOC removed.
It is estimated that 40 percent of the two-piece beer
and soft drink cans would be produced using this alternative
by 1981—primarily for steel cans.
3.3.4.3 Two-Piece Beer and Soft Drink Cans—Base Case with
Thermal Incinerators and Primary Heat Recovery
This alternative assumes that all coating operations cur-
rently employed in the base case are retrofitted with thermal
incinerators. This alternative is presently employed on several
two-piece can lines in Illinois.
The capital required for three incinerators would be
about $66,000—at $20,000 installed cost per CFM.
The annualized capital cost would be about $66
per million cans.
The energy costs to operate the incinerators would
be about $62 per million cans, at $2.25 per million
BTUs.
Material cost would be comparable to the base
case.
The total incremental cost to incinerate emissions from
conventional coatings would be about $128 per million cans.
This represents a cost increase of approximately 0.2 percent,
to reduce emissions by about 42 percent to 0.39 tons per million
cans. The reason for the low overall efficiency is that a
considerable portion of the VOC escapes as fugitive emissions
prior to incineration.
90 percent of the exterior coating emissions reach
the incinerator.
30 percent of the interior spray coating emissions
reach the incinerator.
3-16
-------
The cost of incineration is about $441 per ton of emission
removed. It is estimated that no two-piece can production will
utilize this alternative by the end of 1981—incinerators currently
in use will be shut down.
3.3.4.4 Two-Piece Beer and Soft Drink Cans—Supplemental
Scenario I
This alternative is based upon combining low solvent coatings
with industry product trends that lower the product cost, it
includes:
Print only, eliminating all coating operations—
this is used for some aluminum cans at the present
time
Waterborne interior body spray as proposed by
RACT
End coatings using a low solvent varnish—either
waterborne or high solids.
The elimination of one coating operation would result
in a net saving of about $750 per million cans, comprised of
a material savings of about $540 and an energy saving of
about $230 per million cans. The incremental capital cost
would be $20 per million cans. Emissions are reduced by 79
percent to 0.14 tons per million cans, at a saving of about
$1,450 per ton of emissions reduced or about $1,300 per ton
of emission controlled. It is estimated that 60 percent of
the cans produced in 1982 will utilize this method.
However, it is questionable whether, in determining the
economic impact of VOC regulations, the implementation of RACT
can be given credit for market driven changes in product con-
figuration. Without the credit, the annualized cost would be
$20 per million cans.
3.3.4.5 Two-Piece Beer and Soft Drink Cans—Supplemental
Scenario II
This scenario is based upon the use of an experimental
UV cured varnish, a waterborne interior body spray and an end
coating using a low solvent varnish.
Because of the current high cost of UV cured varnishes,
this approach is only experimental. Based on today's
prices of about $6.50 per gallon for conventional varnishes
and $16.25 for UV cured varnishes, this is the most expensive
approach to emission reduction, about $734 per million cans.
The incremental varnish cost is about $810 per
million cans.
3-17
-------
The energy saving is about $105 per million cans.
The annualized capital cost for converting the
coating systems to UV cured and waterborne coatings
is about $30 per million cans.
This scenario provides a 78 percent reduction in emissions
from the base case, to 0.15 tons per million cans at a cost
of about $1,400 per ton of emission reduced. Because of the
high cost, it is not expected that this approach will be
implemented by 1982.
3.3.4.6 Three-Piece Beer and Soft Drink Cans—Base Case
At the present time, the majority of three-piece beer
and soft drink cans are produced by the following coating
operations:
Interior base coat
Decoration and over varnish
Interior and exterior stripe
Interior spray coating
End sealant.
The production of beer cans differs from the production of
soft drink cans in some respects, the impact of which has not been
considered in this study.
Beer cans almost always have an exterior stripe,
but soft drink cans frequently do not.
Beer cans always have an inside spray coating but
soft drink cans usually do not. However, soft
drink cans frequently have & heavier inside base
coat to offset the elimination of the spray
coating.
Consideration of these differences has been elminated to reduce
the complexity of the study. Because of the declining importance
of three-piece beer and beverage cans, the impact will be smaller
in 1982 than it would be currently.
The total emissions from this alternative are 1.79 tons
per million cans (2.5 times the emissions from a similar two-
piece can).
3.3.4.7 Three-Piece Beer and Soft Drink Cans—Waterborne
Coatings as Proposed in RACT
In this alternative, all the coating operations currently
employed in the base case have been converted to waterborne
coatings. The cost of converting to waterborne systems was
assumed to be minimal.
3-18
-------
The capital cost for converting each of five
coating operations was assumed to be $10,000.
This results in an annualized capital cost of
$104 per million cans—assuming that the cost of
capital and maintenance is 25 percent of the total
installed capital cost and that 120 million cans
are produced annually on the coating line.
The raw material cost of coatings is the same as
for conventional coatings.
The energy consumption is the same—this would
appear reasonable since most of the energy is
consumed to heat the wickets and belts and also
the can metal.
The yield (spoilage) is the same—it appears that
the industry will continue to encounter signi-
ficant spoilage in changing over to new coatings.
However, as the technology is established, it is
assumed that spoilage will decline to currently
acceptable levels.
The total incremental cost to convert to waterborne
coatings is estimated to be about $100 per million cans.
This represents a cost increase of about 0.15 percent. The
emissions would be reduced to 0.34 tons per million cans, an
80 percent reduction at a cost of about $72 per ton.
It is estimated that 25 percent of all beer and soft
drink facilities will employ this option. The acceptance of
this technology will be retarded by the lack of a complete
line of available coatings.
3.3.4.8 Three-Piece Beer and Soft Drink Cans—Base Case with
Thermal Incinerators and Primary Heat Recovery
This alternative assumes that all coating operations
currently employed in the base case are retrofitted with
thermal incinerators. Several thermal incinerators
are currently being employed on coating lines in Illinois.
The capital required for five incinerators would be
about $320,000—assuming an installed cost of $20,000 per CFM.
The annualized capital cost would be about $668
per million cans.
The energy cost to operate the incinerators would
be $166 per million cans.
The material costs would be the same as the base
case.
3-19
-------
The total incremental cost of adopting thermal in-
cineration is estimated to be about $834 per million cans.
This represents a cost increase of about 0.2 percent. The
emissions would be reduced by 59 percent to 0.74 tons per
million cans at a cost of $794 per ton of emissions
removed. Because of the prohibitively high costs of this
alternative, it is estimated that it will be employed only
on 20 percent of all three-piece beer and soft drink cans
manufactured in Illinois in 1982.
3.3.4.9 Three-Piece Beer and Soft Drink Cans—All Waterborne
Except End Sealant, Which Is Thermally Incinerated
It is likely that the can industry will adopt a hybrid
system which will focus on waterborne or possibly other
low solvent coatings and thermal incineration of the end
sealant and which probably will not be universally available
by 1982. Because end sealing compounds represent approximately
12 percent of the VOC from three-piece beer and soft drink can
manufacture, this case was developed under the assumption that
technology-based exceptions will not be granted.
The capital cost of converting four coating
operations and adding one incinerator would be
about $340 per million cans.
The additional energy costs of one incinerator
would be about $93 per million cans.
Material cost would be the same.
The total incremental cost of this scenario would be
about $171 per million cans. This represents a cost in-
crease of about 0.2 percent, to reduce emissions by 80
percent. It is estimated that about 55 percent of the beer
and soft drink cans will be produced using this technology.
3.3.4.10 Three-Piece Food Cans—Base Case
Three-piece food cans are currently produced
utilizing the following coating operations:
Interior base coat
Exterior base coat
Interior stripe
End sealant.
The emissions from this case are estimated to be 0.99
tons per million cans.
3-20
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3.3.4.11 Three-Piece Food Cans—Waterborne as Proposed in RACT
In this alternative, all the coating operations
currently employed in the base case have been converted to
Waterborne coatings.
The total incremental cost to convert to waterborne
coatings is estimated to be $113 per million cans. A 76
percent reduction in emissions is achieved, to 0.24 tons per
million cans. It is unlikely that a complete spectrum 6f
waterborne coatings will be available to meet industry
requirements by 1982 because:
The focus of research is on two-piece beer and
soft drink cans, which is the most rapidly
growing market segment.
The need to achieve FDA approval for the broad
spectrum of products required has caused coating
manufacturers to focus on the large-volume coatings
required for beer and soft drinks.
As a result, it is estimated that only 25 percent of
the cans will be produced using this control approach.
3.3.4.12 Three-Piece Food Cans—Base Case with Thermal
Incinerators and Primary Heat Recovery
This alternative assumes that all coating operations
currently employed in the base case are retrofitted with thermal
incinerators.
The total incremental cost of adopting this approach is
estimated to be about $690 per million cans; about $595
in capital cost and $95 in energy costs. Emissions
would be reduced by 81 percent, to 0.19 tons per million
cans. An estimated 20 percent of the cans would be produced
using this approach.
3.3.4.13 Three-Piece Food Cans—All Waterborne Except
End Sealant, Which Is Thermally Incinerated
Because waterborne and other low solvent coatings
are not available, it is likely that the industry will
develop a hybrid approach utilizing waterborne coatings
where available and incinerating the balance of the emissions.
The end sealing compound appears to be the coating most likely
to be unavailable in low solvent form by 1982—end sealing
compounds release about 18 percent of the VOC emissions from
food can manufacturing operations.
3-21
-------
The total incremental cost of this scenario is about
$200 per million cans; $500 in capital cost and $100 in
energy costs. The emissions are reduced by about 79 percent
to 0.25 tons per million cans. It is estimated that 55 percent
of the cans would be produced using this approach.
3.3.4.14 Sheet Coating Feeder Plant—Low Solvent As
Proposed in RACT
In this alternative all the sheet coating and end
compounding operations will be converted to waterborne. The
total incremental cost to convert to waterborne is estimated
to be about $15 per million cans. It is unlikely that a
complete spectrum of waterborne coatings will be available
to meet industry requirements by 1982; as a result, 60 percent
of the stock will be coated with waterborne coatings.
3.3.4.15 Sheet Coating Feeder Plant—Thermal Incinerators
And Primary Heat Recovery
This alternative assumes that all sheet coating
and end compounding lines are retrofitted with incinerators.
At the present time a significant number of sheet coating lines
in Illinois already are operating incinerators. Because of the
already installed incinerators and the lack of a complete
spectrum of coatings, it is estimated that 40 percent of the
stock will be coated using thermal incinerators for VOC control,
3-22
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EXHIBIT 3-13
U.S. Environmental Protection Agency
EMISSIONS FROM COATING TWO-PIECE ALUMINUM
BEER AND SOFT DRINK CANS
Alternative
Annual!zed Incremental Costs (S/mlllion cans)
Annualized
Capital Capital Cost Matprials Energy Total
($/milllon
cans)
Coatinq
Input
(gals./million
cans)
Emissions
voc
Emissions
voc
Decrease
(tons/million (tons/million
cans) cans)
Incremental
Co«;t
IS/ton)
1978 MSB CASE 0
Print and varnish
Nonoonfirming interior
body »pr«y (exempt
solvents)
End coating
WATERBORHE AS PROPOSED 12O
IN RACT
BASE CASE WITH THERMAL 266
INCINERATORS «
PRIMARY HEAT RECOVERY
SUPPLEMENTAL SCENARIO 1 BO
Print only
Waterborne interior
body spray
End coating using a
low varnish aolvent
SUPPLEMENTAL SCENARIO 2 120
Print
UV cured varnish
Waterborne Interior
body spray
End coating using a
low solvent varnish
250
0.67
30
66
20
30
30
62 128
(540) (230) (750)
340
250
2OO
0.19 0.48 75
0.39 0.29 42
BIO
105 734
240
63
441
0.14 0.53 79 (1415)
0.15 0.52 78 1411
a. Not Applicable
Source: Booz, Allen t Hamilton Inc. estimates
-------
EXHIBIT 3-14
U.S. Environmental I'toLuct ion Agency
EMISSIONS FROM COATING THREE-PIECE CANS
Case
Capital
(S/million
cans)
Annualized Incremental Costs ($/million cans)
Annualized
Capital
Cost/Millions Materials Energy Total
Coating And Emissions
Coating VOC VOC Incremental
_Input Emissions Decrease Cost
(gals./million(tons/million (tons/million ($/ton)
cans) cans) cans)
1978 BASE CASE 0
Interior base coat
Decoration and/or
varnish
Interioring and
exterioring stripe
Interior spray
End sealant
WATERBORNE AS PROPOSED 416
IN RACT
BASE CASE WITH THERMAL 2670
INCINERATORS AND HEAT
RECOVERY PRIMARY
SUPPLEMENTAL SCENARIO 3 686
Waterborne except end
sealant which is incin-
erated
1978 BASE CASE 0
Interior base coat
Exterior base coat
Interior stripe
End sealant
WATERBORNE AS PROPOSED 453
IN RACT
BASE CASE WITH THERMAL 2380
INCINERATORS AND
PRIMARY HEAT RECOVERY
SUPPLEMENTAL SCENARIO 4 768
All waterborne except
end sealant which is
incinerated
BEVERAGE CANS
0 0
894
1.79
104
668
171
113
595
192
0 104
166 834
20 191
FOOD CANS
0 0
0 113
95 687
17 209
720
694
715
424
439
424
435
0.34 1.45 81
0.74 1.05 59
0.35 1.44 80
0.99
0.24 0.75 76
0.19 0.80 81
0.23 0.76 77
72
794
133
151
859
275
a. Not'Applicable
Source: Booz, Allen 6 Hamilton Inc. estimates;
-------
3.4 COST AND VOC BENEFIT EVALUATIONS FOR THE MOST LIKELY
RACT ALTERNATIVES'
Costs for alternative VOC emission controls are presented
in this section based upon the costs per million cans developed
for each alternative in the previous section. The extrapolation
is based upon can production and emission for actual can
manufacturing processes and not upon the representative plants.
3.4.1 Costs for Alternative-Control Systems
Although there is no typical can manufacturing facility,
the following four representative plants describe the situation
in most can manufacturing facilities.
Representative Plant A produces two-piece beer and
soft drink cans on two lines. Each line operates
at 650 cans per minute for 6,500 hours annually,
to produce approximately 250 million cans—total
plant production is 500 million cans.
Representative Plant B produces 80 percent three-
piece beer and soft drink cans and 20 percent three-
piece food cans using three assembly lines. The
sheet coating lines operate at 2.5 base boxes per
minute for about 4,000 hours per year, to support
the three assembly lines. Each can assembly line
operates at 400 cans per minute, the beer lines
for 5,000 hours annually and the food can lines
for 3,000 hours annually.
Representative Plant C coats and decorates flat
stock for use in satellite assembly plants. The
plant coats at 2.5 base boxes per minute. Its
operating rate is approximately 1,000 hours per
satellite plant production line. Assuming the
plant supports four lines, its operating rate would
be 4,000 hours annually.
Representative Plant D produces food cans from
precoated stock. It contains two can assembly
lines, each of which operates at 400 cans per
minute for 3,000 hours annually. The total plant
production is 144 million cans.
3-23
-------
The capital cost to adopt the alternative controls to the
four representative plants ranges from $20,000 (to convert the
can assembly plant to waterborne coatings) to more than $400,000
(to retrofit the three-piece coating and assembly plant with
incinerators). The incremental operating costs (energy plus
25 percent of capital) range from a savings of $375,000 (for
the two-piece beer and soft drink plant that was converted to
"print only") to a cost of $387,000 (for operating incinerators
at the three-piece coating and assembly plant). Capital and
annual operating costs for each of the representative plants
are presented for each applicable alternative on Exhibit 3-15,
on the following page.
3-4.2 Extrapolation of the Costs to the Statewide Industry
The costs developed are incremental costs based on the
production volume and mix estimate for 1977. Industry changes
related to plant closings, conversion to two-piece lines, con-
sumption patterns or other areas not directly related to FACT
implementation were not included. One exception is that the
trend to print-only on existing lines was addressed and the
portion allocated to RACT was estimated and included in the
final figures.
The can manufacturing industry in Illinois is part of an
integrated nationwide network (the greatest volume of cans are
produced by firms with nationwide operations for customers who
source their products nationwide), of facilities using established
and nonproprietary technology. Therefore, Illinois costs can be
readily estimated from data developed on a nationwide bases.
Extrapolation of the costs to the statewide industry requires,
first, segmenting the industry in Illinois according to the types and
number of major cans produced, quantifying emissions from each
type of can production and identifying the 1977 level of controls,
if any, to develop a 1977 baseline case. Second, the likely
industry response to the regulations must be developed; and
finally, the cost of implementing this response must be calculated.
The data and estimates necessary to perform this extrapolation
have been presented in previous sections.
Can production (in units) by type was presented in
section 3.2.3.
Emissions (per million cans) from the production of
cans using the various coating operations was pre-
sented in Exhibits 3-7, 3-8 and 3-9 and combined
on Exhibits 3-13 and 3-14, for several control
alternatives for the major types of cans (including
print only).
3-24
-------
EXHIBIT 3-15
U.S. Environmental Protection Agency
COST OF IMPLEMENTING RACT ALTERNATIVES FOR
REPRESENTATIVE CAN MANUFACTURING PLANTS ($1,000)
* Watarbomo
t«o riant Haterborne Thc-mal Incineratora Print Only/Materborna UV Curad/Matarborne Incinerate Did Sealant
Capital Annual Capital Annual Capital Annual Capital Annual CapitalAnnual
Eapanaa Eapenae Eapcnao Eapenea tapenae
*. a-filee* boar ft »oft «> IS 132 M 40 (375) «O 3*7
1 linee
SO* •lllla
9-t>Ioeo boar ft oo»t 100 25 415 3»7 a abb 1M 1M
aklak and food can
eoatiaaj and aai
1 eoatiaf li«a
I akMt vanlal) lin*
9 MMa»>ly HIM*
UO •Ullio*
ooatiftf facility 30 • 255 141 a • b b «2
lor M« bMv oana •
SO* f«te4 can*
I aa*at ooatina; tin*
1 ahMt vatniahinaj Una)
•HWltM stack (or 2«0
•Ullloa
0. ftoo* caw asMoJily plant 20 S 60 20
i aaaaafely Una*
witk in* Ida •trlpln*
144 «111 ton cana
a. Nut applicable
b. Not considered to be a likely resins* by Itttt
Sourcai Boos, Allan I Haaiilton Inc. eatimat**
-------
Theoretical uncontrolled emissions were calculated
by multiplying the number of cans of each type by
the 1977 base case alternative on Exhibits 3-13
and 3-14. This estimate of 11,204 tons was pre-
sented in section 3.3.2.
Emissions from the Illinois can manufacturing industry were
reduced by an estimated 3,000 tons per year by the end of 1977,
through control approaches acceptable under RACT. The 1977
emission reduction was achieved to the 1977 base line of 8,200
tons:
2,500 tons through incineration
500 tons through waterborne and other low
solvent coatings.
The industry response in 1982 to the RACT alternatives
was presented in section 3.3.4 and summarized on Exhibit 3-12.
It included a discussion of the cost and emission reductions
from the theoretical level of uncontrolled emission. Exhibit
3-16, on the following page, shows that likely industry capital
expenditures of $9.6 million will be required to comply with
RACT. The annual compliance cost is estimated at $2.9 million
excluding a credit of $230,000 for reduced material and energy
costs that arise from reducing the number of coatings on two-
piece cans to enhance their cost effectiveness against other
packages. It is estimated that emissions will be reduced by
8,800 tons from the theoretically uncontrolled level of 11,200
tons, excluding an additional 100 ton reduction that is expected
to result through the increased usage of print only.
With the 1977 base line at 8,200 tons, it is expected
that the industry will incur an incremental annual expense
of $885,000 to reduce the emissions to 2,360 tons. The
relatively low incremental cost of $153 per ton is a direct
result of the fact that the industry is not expected to
increase the number of incinerators and may decrease slightly
the utilization of existing incinerators.
3-25
-------
EXHIBIT 3-16(1)
U.S. Environmental Protection Agency
COST OF COMPLIANCE TO RACT FOR THE
CAN MANUFACTURING INDUSTRY IN ILLINOIS
CAM TYPE
Can Production
(millions of units)
Mater-
borne or
Other Low
Solvent
Coatings
Thermal
Incineration
with Primary
Heat Recovery
Print Only,
All Low Solvent
Coatings
Low Solvent
Coatings
Except
End Sealant
which Is
Incinerated
Total
Water-
borne or
Other Low
Solvent
Coatings
Capital Investment
(thousands of S)
Thermal
Incinerntion
with Primary
Heat Recovery
Print Only,
All Low Solvent
Coatings
Low Solvent
Coatings
Except
End Sealant
Which Is
Incinerated Total
2-Piece
Beer and
Soft Drink
200
300
500
24
48
3-Piece
Beer and
Soft Drink
125
100
275
500
52
266
154
472
3-Piece
Food and
Other Cans 2,150
1,720
4,730
8,600
542
4,095
3,633
8,270
Sheetcoating
operations
for ship-
ment out
of Illinois 1,200
800
2,000
124
703
827
Total RACT
11,600
742
5,064
24
3,707
9,617
-------
KXHiniT 3-16(2)
U.S. Environmental Protection Agency
CAN TYPE
Annual Compliance Cost
(thousands of S)
Emission Reduction
(tons)
Low Solvent
Water- Coatings
borne or Thermal i:xcopt
Other Low Incineiation Print Only, End Sealant
Solvent with Primary All Low Solvent Which Is
Coatings Heat Recovery Coatings Incinerated Total
2-Piece
Beer and
Soft Drink 6 0 (225) a (219)
3-Piece
Beer and
Soft Drink 13 83 a 47 143
3-Piece
Food and
Other Cans 242 1,181 a 946 2,369
Sheetcoating
operations
for ship-
ment out
of Illinois 21 394 a a 415
Subtotal 282 1,658 (225) 993 2,708
Less con-
trols in
place prior
to 1977 53 1,658 0 336 2,047
Less product
changes a a 234 a (234)
Total RACT 229 0 ') 657 B85
Low Solvent
Water- Coatings
borne or Thermal Except Unit
Other Low Incineration Print Only, End Sealant Cost of
Solvent with Primary All Low Solvent Which Is Emission
Coatings Moat Recovery Coatings Incinerated Total Reduction
($ per ton]
96 0 159 a 255 (858)
181 104 a 396 681 209
1,613 1,376 a 3,596 6,585 360
792 527 a a 1,319 600
2,682 2,007 159 3,992 8.R40 323
500 2,000 0 (500) (3,000)
a a (78) a (78)
2,1(12 7 81 3,492 5,762 151
a. Not applicable
Source: Mooz, Allen & Hamilton Inc.
-------
The substantial cost of developing, testing and obtaining
FDA approval of low solvent coatings has not been included in
this evaluation, because it is outside the scope of this study
and the bulk of it will probably be incurred at the national
level. An evaluation of these costs and the degree to which they
should properly be allocated to each state must be undertaken
on a national basis.
A factor that should be taken into account is that the
analysis assumes that production lines will be converted in
proportion to the number of cans made by each production mode.
Where a single line makes several types of cans, a portion of
which can be converted to low solvent systems, the production
line might still require installation of afterburner control
under RACT requirements, though its use would only be intermit-
tent. The potential effect of this on the cost estimates is
difficult to quantify. It is discussed below.
If we assume that all sheet coating and three-piece
assembly lines were required to install incinerators, to main-
tain capability to utilize both conventional and low solvent
coatings, the projections would be changed as follows:
Capital expenditure would be increased by $25
million or approximately 300 percent.
Annual cost would increase by $625 million.
This represents the capital related costs only.
Emissions reduction estimates would be unchanged.
The figures presented above represent outside limits with
actual experience likely to fall somewhere between the two
figures. Since most of the can fabrication facilities in Illi-
nois are dedicated to beverage cans, for which low solvent coatings
systems are likely to be developed by 1982, the effect of
this capability maintenance factor will be felt on relatively
few production lines.
Assuming that 1977 baseline emissions were 8,200 tons,
implementation of RACT will reduce emissions by approximately
5,800 tons to the same 2,440 tons (excluding the additional
800 ton reduction for conversion to print only). The 1982
reduction is expected to emphasize waterborne coatings rather
than incineration.
3-26
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3.5 DIRECT ECONOMIC IMPLICATIONS
This section presents the direct economic implications
of implementing RACT controls to the statewide industry, in-
cluding: availability of equipment and capital; feasibility
of the control technology; and impact on economic indicators
such as value of shipments, unit price, state economic variables
and capital investment.
3.5.1 RACT Timing
RACT must be implemented statewide by January 1, 1982.
This implies that can manufacturers must have either low
solvent coatings or VOC control equipment installed and
operating within the next three years. The timing of RACT
imposes several requirements on can manufacturers including:
Obtaining development quantities of low solvent
coatings from their suppliers and having them
approved by their customers
Having coating makers obtain FDA approval where
necessary
Obtaining low solvent coatings in sufficient
quantity to meet their volume requirements
Acquiring the necessary VOC control equipment
Installing and testing incinerators or other VOC
control equipment to insure that the system
complies with RACT.
The sections which follow discuss the feasibility and the economic
implications of implementing RACT within the required timeframe.
3.5.2 Feasibility Issues
Technical and economic feasibility issues implementing
RACT controls are discussed in this section.
The can manufacturing industry, in conjunction with coating
suppliers and incinerator vendors, has extensively evaluated
most of the approaches to meeting RACT. The feeling in the
industry is that, but for one notable exception, RACT can be
achieved by January 1, 1982, using low solvent coatings—
primarily waterborne. The coating most likely to be unavailable
in 1982 is the end sealing compound. The physical characteristics
of this material, as well as its method of application, do not lend
themselves to incineration. Currently, the coating is air dried
over a period of 24 hours.
3-27
-------
The can manufacturers have shut down a significant number
of three-piece can manufacturing facilities. It appears likely
that the implementation of RACT will accelerate this trend
because of the lower cost of compliance with two-piece cans and
the probable reluctance on the part of can manufacturers to
invest capital in facilities producing products with declining
demand. •
3.5.3 Comparison of Direct Cost with Selected Direct
Economic Indicators
This section presents a comparison of the net increase
in the annual operating cost of implementing RACT with
the total value of cans sold in the state, the value of
wholesale trade in the state and the unit price of cans.
The net incremental operating cost from the uncontrolled
level to can manufacturers is estimated to be $2.7 million
(0.3 percent) of current manufacturing costs. The future
economic impact on the industry is likely to be considerably
less than $2 million because of considerable controls already
in place.
3.5.4 Ancillary Issues Relating to the Impact of RACT
This section present two related issues that were developed
during the study.
The can manufacturers are seeking to have the guidelines
altered to encompass a plantwide emissions basis. This would
allow a credit from one operation, where emissions were reduced
to below the RACT recommended level, to be applied to another
operation that is not in compliance. The plant would be in
compliance if the total emissions were reduced to the level
proposed in RACT. It appears that the impact of this proposed
regulation, if accepted, would be to further concentrate the
difficult-to-control emissions, such as end sealing compounds,
into the largest facilities and to reduce further the number of
can assembly plants.
High solvent coatings represent a considerable fire hazard.
The conversion to low solvent coatings has reduced fire insurance
costs for at least one can manufacturing facility.
Exhibit 3-17, on the following page, presents a summary
of the current economic implications of implementing RACT
for can manufacturing plants in the State of Illinois.
3-28
-------
EXHIBIT 3-17
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR CAN MANUFACTURING PLANTS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
VOC emissions
Industry preferred method of VOC
control to meet RACT guidelines
Discussion
There are 30 can manufacturing facilities
The Chicago area is one of the largest can
manufacturing centers in the country. The
1977 value of shipments was about S800
million
Beer and beverage containers rapidly
changing to two-piece construction
8,000 tons per year CBooz, Allen estirate)
theoretical uncontrolled level is 11,100
tons per year
Low solvent coatings (waterborne)
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized operating cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after control
Cost effectiveness of control
$9.5 million from uncontrolled state
(4.4 million above 1977 level). Current
investments are S15 million to $30 million
$2.7 million—about 0.3 percent of current
direct annual operating costs ($0.89 millior
above 1977 level)
Assuming a direct pass-through of costs, no
significant change in price
Increase of 23,00 equivalent barrels of oil
annually to operate incinerators (virtually
no increase from 1977 level)
No major impact
No major impact
Accelerated technology conversion to
two-piece cans
Further concentration of sheet coating
operations into larger facilities
Low solvent coating technology for end
sealing compound
2,360 tons per year (28 percent of 1977
emission level)
$323 annualized cost/annual ton of VOC
reduction from theoretical level ($153
per ton attributable to RACT)
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
Control of Volatile Organic Emissions from Stationary Sources,
EPA-450/2-77-008, May 1977.'
Air Pollution Control Engineering and Cost Study of General
Surface Coating Industry, Second Interim Report, Springborn
Laboratories, Enfield, CT, August 23, 1977
Private conversations at the following companies
American Can Company, Greenwich, Connecticut
Continental Can Company, Chicago, Illinois
Heekin Can Company, Augusta, Wisconsin
National Can Company, Chicago, Illinois
Libby McNeil & Libby, Baraboo, Wisconsin
Joseph Schlitz Brewing Company, Oak Creek, Wisconsin
Carnation Company, Waupam, Wisconsin
Campbell Soup Company, Napoleun, Ohio
Green Giant Company, Ripon, Wisconsin
Fall River Canning Company, Fall River, Wisconsin
Miller Brewing Comapny, Miller, Wisconsin
Ocononowoc Canning Company, DeForest, Wisconsin
Diversified Packagers, Howell, Michigan
Can Manufacturers Institute, Washington, D.C.
-------
-------
4.0 THE ECONOMIC IMPACT OF IMPLEMENTATION
OF RACT GUIDELINES TO THE SURFACE COATING
OF COILS IN THE STATE OF ILLINOIS
-------
-------
4.0 THE ECONOMIC IMPACT OF IMPLEMENTATION
OF RACT GUIDELINES TO THE SURFACE COATING
OF COILS IN THE STATE OF ILLINOIS
As will be shown in this chapter, there will be no economic
impact resulting from the implementation of RACT standards to
the coil coating business in the state of Illinois. This is
due, primarily, to the current existence of adequate VOC emission
control methods being implemented in the state.
This chapter is divided into four sections:
Specific methodology and quality of estimates
Applicable RACT guidelines and control technology
Coil coating operations in the state of Illinois
Direct economic implications
4-1
-------
4.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Economic impacts
for the surface coating of coils in Illinois.
An overall assessment of the quality of the estimates is
detailed in the latter part of this section.
4.1.1 Industry Statistics
Coil coating is listed under Standard Industrial Classi-
fication (SIC) 3479. Our methodology to gather statewide
statistical data on coil coating in Illinois was as follows:
A list of potentially affected facilities was
compiled from the state emission inventory.
Interviews were performed with those companies
appearing on the list of emitters to validate
their participation in this industry sector (this
list was not 100 percent validated).
4.1.2 VOC Emissions
The state of Illinois EPA identified nine coil coating
facilities with twelve coating lines. The following sources
were utilized by the Illinois EPA to identify VOC emitters in
this industry category:
Illinois EPA emission inventory
National Coil Coaters Association
Thomas Register
Industrial Yellow Pages of Chicago.
4.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emission for the surface
coating of coils are described in Control of Volatile Organic
Emissions from Existing Sources, Volume II; Surface Coatings
of Cans, Coils, Paper, Fabrics, AutomobiTes and Light Duty
Trucks, EPA-405/2-77-008, May 1977.
4-2
-------
4.1.4 Cost of Control of VOC Emissions for Surface
Coating of Coils
The costs of control of volatile organic emissions for
surface coating of coils were developed by:
Determining the alternative types of control
systems likely to be used
Estimating the probable use of each type of control
system
Defining system components
Defining a model plant
Applying the costs developed by Springborn
Laboratories (under EPA contract number 68-02-2075,
August 23, 1977) to the most likely alternative
types of control:
Installed capital cost
Direct operating cost
Annual capital charges
Energy requirements
Extrapolating model costs to individual industry
sectors
Aggregating costs to the total industry for the state,
4.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements to implement RACT, assessing the
feasibility of instituting RACT controls in terms of capital
availability and equipment availability, comparing the direct
costs of RACT control to various state economic indicators and
assessing the secondary effects on market structure, employment
and productivity as a result of implementing RACT controls in
Illinois.
4-3
-------
4.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls on the surface coating of coils in Illinois. A rating
scheme is presented in this section to indicate the quality of
the data available for use in this study. A rating of "A" indicates
hard data (data that are published for the base year), "B" indicates
data that were extrapolated from hard data and "C" indicates data
that were not available in secondary literature and were estimated
based on interviews, analysis of previous studies and best
engineering judgment. Exhibit 4-1, on the following page, rates
each study output listed and the overall quality of the data.
4-4
-------
EXHIBIT 4-1
U.S. Environmental Protection Agency
SURFACE COATING OF COILS
DATA QUALITY
Study Outputs
Industry statistics
Hard Data
B
Extrapolated
Data
Estimated
Data
X
Emissions
X
Cost of emissions control
X
Economic impact
Overall quality of data
Source: Booz, Allen & Hamilton Inc.
-------
4.2 APPLICABLE RACT STANDARDS AND CONTROL TECHNOLOGY
This section includes a review of:
Applicable RACT standards
The technology of coil coating
Commercial aspects of the business
Approved control technologies
Estimated capital and operating costs to control
VOC emissions.
4.2.1 Approved RACT Standards
As indicated in the EPA guidelines Article XX.9204, subpart
(d) (1):
...no owner or operator of a coil coating line...
may cause, allow or permit discharge into the
atmosphere of any volatile organic compounds in
excess of 0.31 kilograms per liter of coating
(2.6 pounds per gallon), excluding water,
delivered to the coating applicator from prime
and topcoat or single coat operations.
Thus, of the approximately 4 to 6 pounds of VOC contained
in a gallon of paint to be applied with coil coating techniques,
the operator must not allow emission of more than 2.6 pounds.
The reduction in emissions may be achieved by utilization of
low solvent content coating technology, thermal incineration
or other approved methods.
4.2.2 The Technology of Coil Coating
Coil coating is the coating of any flat metal (aluminum
or steel typically) sheet or strip that comes in rolls or coils.
This process consists of taking the coil through a series of
steps in one continuous process. Generally, these steps include
Cleaning—removal of mill-applied protective oils,
dirt, rust and scale
Rinsing—removal of the products of the cleaning
process
Pretreating—with chemicals such as iron and zinc
phosphates, chromates and complex oxides to prepare
the metal for coatings
Rinsing—after the pretreatment
1. National Coil Coaters Association brochure
4-5
-------
Painting—commonly by application of primer and finish
coats with a "reverse" roller technique in which
the roll applying the coating turns in the opposite
direction of the metal being coated
Curing—all coatings are cured in seconds as they
pass through ovens, mostly of the convention or
heat air type. At the end of the curing operation,
the coated metal is recoiled for shipment.
Configurations of coil coating lines differ. On some
lines, the metal is uncoiled at one end of the line and recoiled
at the opposite end. On other lines, called "wrap around"
lines, the metal is uncoiled and recoiled at about the same
point on the line. Some coil coating lines have a single coater
and one curing or baking oven; others, called "tandem" lines,
have several successive coaters each followed by an oven, so that
several different coatings may be applied in a single pass.
Exhibit 4-2, on the following page, is a schematic of a "tandem"
coil coating line.
The metal on the coil coating line is moved through the
line by power-driven rollers. It is uncoiled as the process
begins and goes through a splicer, which joins one coil of metal
to the end of another coil for continuous, nonstop production.
The metal is then accumulated so that, during a splicing operation,
the accumulator rollers can descend to provide a continuous
flow of metal throughout the line. The metal is cleaned at
temperatures of 120°F to 160°F, brushed, and rinsed to remove
dirt, mill scale, grease and rust before coating begins. The
metal is then treated for corrosion protection and for proper
coating adhesion with various pretreatments, depending on the
type of metal being coated and the type of coatings applied.
The first coat or primecoat may be applied on one or both
sides of the metal by a set of three or more power-driven rollers.
The pick-up roll, partially immersed in the coating, transfers
the coating to the applicator roll. The metal is coated as
it passes between the applicator roll and the large back-up
roll. The metal is typically reverse roll coated. Exhibit 4-3,
following Exhibit 4-2, is a schematic of a typical roll coater.
A third roll, called a "doctor" roll, may be used to control
film thickness when applying a high viscosity coating, by making
contact with the pick-up roll.
4-6
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EXHIBIT 4-2
U.S. Environmental Protection Agency
DIAGRAM OF A COIL COATING LINE
ACCUMULATOR
SPLICER
U
UMCOIIINC
METAl
Q
ACCUMULATOR
PRIME
COATER
METAl CLEANING PRETREATMENT
PRIME
OVEN
PRIME
OUENCH
SHEAR
TOPCOAT
COATER
TOPCOAT
OVEN
TOPCOAT
QUENCH
RECOILING
METAl
Source: Control of Volatile Organic Emissions from Existing Stationary Sources-Volume II; Surface
Coatings of Cans, Coils, Paper, Fabricsf Automobiles and Light Duty Trucks (EPA,
405/2-77-008, May 1977).
-------
EXHIBIT 4-3
U.S. Environmental Protection Aoer
TYPICAL REVERSE ROLL COATER
APPLICATOR ROLL
INTO OVEN-
PICKUP ROLL
PICKUP ROLL
FLOW OF METAL INTO COATER
Source; Control of Volatile Organic Emissions from Existing Stationary
Sources-Volume II; Surface Coatings of Cans, Coils, Paper,
Fabrics, Automobiles and Light Duty Trucks (EPA, 405/2-77-008,
May 1977).
-------
The applied coating is usually dried or baked in a
continuous, catenary or flotation or a double-pass oven that
is multizone and high production. The temperatures of the
preheat, drying or baking zones may range from 100°F to
1000°F depending on the type and film thickness of coating
used and the type of metal being coated. The flow rates of
the ovens' exhausts may vary from approximately 4,000 scfm
to 26,000 scfm. Many of these ovens are designed for
operation at 25 percent of the room-temperature lower explosive
level when coating at rated solvent input. As the metal
exits the oven, it is cooled in a quench chamber by either a
spray of water or a blast of air followed by water cooling.
A second coat or topcoat' may be applied and cured in a
manner similar to the primecoat. The topcoat oven, however,
is usually longer than the primecoat oven and contains more
zones.
Another method of applying a primecoat on aluminum coils
or a single coat on steel coils is to electrodeposit a water-
borne coating to either one or both sides of the coil. The
coil enters a V-shaped electrocoating bath that contains a roll
on the bottom. As the metal goes around the roll, electrodes on
each side can be activated and permit the coagulation of the paint
particles on either one or both surfaces of the coil. The coated
coil is then rinsed and wiped by squeeges to remove the water and
excess paint particles. For steel coils, the electrodeposited
coating must be baked in an oven. For aluminum coils, however,
the primecoat is stable enough to go over rolls immediately to
the topcoat coater without destroying the finish, and then be
baked as a two-coat system.
After cooling, the coated metal passes through another
accumulator, is sheared at the spliced section, usually waxed
and finally recoiled. The accumulator rolls rise during the
shearing process, collecting the coated metal to ensure
continuous production.
Organic vapors are emitted in three areas of a coil
coating line: the areas where the coating is applied, the oven
and the quench area. The oven emits approximately 90 percent
of the organic vapors and a majority of the other pollutants.
Of the remaining 10 percent of hydrocarbons emitted, approxi-
mately 8 percent are emitted from the coater area and approxi-
mately 2 percent are emitted from the quench area.
4-7
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4.2.3 Commercial Aspects of the Business
Coil coating was first practiced in the 1930s as a
technique to coat metal for Venetian blinds. As the tech-
nical, operating and economic advantages became apparent,
the industry experienced remarkable growth. Since 1962, for
example, estimated shipments have shown an average annual
growth rate of some 16.5 percent. By 1977, as shown in
Exhibit 4-4, on the following page, more than four million
tons of aluminum and steel were coated using this method.
In terms of dollars, the four million tons of coated
coil produced in the U.S. in 1977 represented a total product
value of some $3.5 billion. Other pertinent indicators of
the scale of this business include the following:
Approximately 13 billion square feet of coated
coil were produced.
Organic coatings of several types currently
utilized by the coil coaters in North America
represent 19 million gallons. These, coupled
with various types of film laminates, represent
a total estimated value of $140 million in
coatings.
Chemical pretreatment for coil coaters is es-
timated at a value of $10 million.
It requires approximately 12.8 billion cubic feet
of natural gas and 4.1 million gallons of propane
to cure these coatings. To coat the equivalent
metal by "post painting" would require approxi-
mately five times this amount of energy.
Today, there are 182 coil coating lines in North
America, ranging in maximum coil width capacity
from 2 to 60 inches and capable of running at
maximum speed from 100 to 700 feet per minute.
If all these lines were running at full capacity,
it is estimated that they could coat more than 20
billion square feet of metal per year.
4.2.4 Approved Control Technologies
Per the Environmental Protection Agency Guidelines in
Article XX.9204, subpart (d)(2), the emission limit shall be
achieved by:
The application of low solvent content coating
technology; or
4-8
-------
EXHIBIT 4-4
Environmental Protection Agency
ESTIMATED TONNAGE OF METAL COATED IN THE
U.S. IN 1977 WITH COIL COATING TECHNIQUES
Market
Building products
Transportation
Appliances
Containers, packaging
Furniture, fixtures
and equipment
Other uses
Steel
Shipments
(tons)
1,100,000
1,400,000
140,000
80,000
110,000
220,000
3,050,000
Aluminum
Shipments
(tons)
610,000
100,000
25,000
200,000
15,000
50,000
1,000,000
Source: National Coil Coaters Association statistics.
-------
Incineration, provided that 90 percent of the
nonmethane volatile organic compounds (VOC measured
as total combustible carbon) which enter the
incinerator are oxidized to carbon dioxide and
water; or
A system demonstrated to have control efficiency
equivalent to or greater than provided under
the preceding paragraphs. . .and approved by
the Director.
4.2.5 Estimated Capital and Operating Costs to Control VOC
Emissions
Estimates of capital and operating costs to control VOC
emissions from coil coating operations were prepared by
Springborn Laboratories, Inc., for the Environmental Protection
Agency (Contract No. 68-02-2075, August 23, 1977). These
estimates are discussed in this section.
The model chosen handles material 40 inches wide and
coats at a speed of 300 feet per minute. This yields a
yearly production of 204 million square feet when operated
for 4,000 hours per year. The material usage is 344,630
gallons of paint and 34,460 gallons of solvent per year.
Case I The base case with no controls for emissions;
shows the cost of a new line using conventional
enamel coating which does not meet RACT
Case II The use of waterborne coating materials with
no additional treatment of emissions
Case III The base case with a thermal incinerator on
each of the primecoat and topcoat ovens.
Due to the relation of the coating appli-
cator to the curing oven, the oven exhausts
are assumed to be 90 percent of total emissions.
The incinerator is figured with primary heat
exchange to minimize the fuel costs and
operates at an average 90 percent efficiency.
Emission control costs for each of the cases studied
are summarized in Exhibit 4-5, on the following page. As
indicated, additional capital costs to install emission control
systems range from $50,000 to $254,000 over the base case
capital cost depending on the alternative selected. Operating
costs range from $8,000 to $75,000 more than the base case, or
0.3 percent to 2.5 percent increased cost per unit. Costs per
ton of solvent range from $11 to $112.
4-9
-------
EXHIBIT 4-5
U.S. Environmental Protection Agency
SUMMARY OF EMISSION CONTROL COSTS
Output 204,000,000 SF/yr.
(18,950,000 sq. meters)
4,000 hours/year
Total
Investment
Increase
over
Base Case
Increased
Total Annual Cost
Annual over
Cost Base Case
Cost/Unit
1000 SF
(1000 SM)
Case
Increased
Cost Per
1000 SF
over Base
S %
Tons
(Metric Tons)
Solvent
Emitted/Yr.
Decreased
Emission
over Base
(Metric Tons)
Emission
Reduction
Cost/Ton
(Metric Tun)
To Hemovf*
Solvent
Base Case -
solvent-borne
primecoat
K topcoat
3,300,000
2,977,400
14.59
(157.05)
832.3
(755)
II
Waterborne
primecoat
K topcoat
3,350,000
50,000
2,985,800
8,400
14.64
(157.58)
0.05 0.3
98.9
(89.9)
733.4
(665.1)
88
(12.61)
III Base Case with
thermal incin-
erators on
ovens; primary
heat recovery
3,554,260
254,260
3,052,860 75,460
14.96
(161.03)
0.37 2.5
158.1
(143.5)
674.2
(611.5)
81
111 .
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4.3 COIL COATING OPERATIONS IN THE STATE OF ILLINOIS
At present, there are nine coil coating facilities with
twelve coating lines in Illinois. Details pertinent to these
operations are shown in Exhibit 4-6, on the following page.
As shown in the exhibit, all nine firms have installed incin-
eration and are assumed to be meeting the RACT guidelines.
4-10
-------
EXHIBIT 4-6
U.S. Environmental Protection Agency
COIL COATING OPERATIONS IN ILLINOIS
Company
Reveve Aluminum
Reynolds Metals
Pre-Finish Metals
Litho-Strip Co.
Seaway Building
Prod.
Finished Metals
Inc.
Alumax Mill Prod.
American Nickeloid
Zeger's Inc.
TOTAL
Plant Location
Franklin Park
McCook
Elk Grove
Chicago
Chicago
Chicago
Morris
Peru
Peotone
Current VOC
Emissions
(tons/yr . )
156
Negligible
847
123
11
-
0.2
Negligible
7
Emission Control
Equipment
Afterburner with
scrubber
Afterburner
Afterburners
Afterburners
Afterburners
Afterburners
Afterburners
Afternburners
Afterburners
Comment
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
Currently meeting
RACT
l,144e
a. This is the total from the oven area. An additional 1,172 tons/year is emitted and not controlled
from the coater and quench area for an overall total of 2,318 tons/year.
Source; Illinois EPA, report dated June 9, 1978
-------
4.4 DIRECT ECONOMIC IMPLICATIONS
As previously indicated, application of RACT standards
to the coil coating business in Illinois will have no economic
impact, because the nine firms coating coils in Illinois have
implemented incineration and are assumed to be in compliance.
Exhibit 4-7, on the following page, summarizes the
findings presented in this chapter.
4-11
-------
EXHIBIT 4-7
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR COIL COATING FACILITIES
IN THE STATE OF ILLINOIS
Current Situation
Number .of potentially affected facilities
Discussion
There are 9 coil coating facilities
coating coils in Illinois. They cur-
rently meet RACT emission limitations
Current industry technology trends
Due to the pressures of energy availability
as well as environmental protection, most
firms have or are installing regenerative
type incinerators
1977 VOC emissions (actual)
2,318 tons per year
Industry preferred method of VOC control
to meet RACT guidelines
Regenerative thermal incineration
Assumed method of control to meet RACT
guidelines
Regenerative thermal incineration
Affected Areas in Meeting RACT
Capital Investment (statewide)
None
Discussion
Annualized Cost (statewide)
None
Energy
None
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
No impact
No impact
No impact
No impact
None
VOC emission after control
2,318 tons per year
Cost effectiveness of control
None
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
Springborn Laboratories, Inc., Air Pollution Control
Engineering and Cost Study of General Surface Coating
Industry, Second Interim Report. EPA Contract No.
68-02-2075, August 23, 1977.
U.S. Environmental Protection Agency, Control of
Volatile Organic Emissions from Existing Stationary
Sources, Volume II. Surface Coating of Cans, Coils,
Paper, Fabrics, Automobiles and Light Duty Trucks.
Private conversations with:
National Coil Coaters Association
-------
-------
5.0 THE ECONOMIC IMPACT OF IMPLEMENT-
ING RACT FOR PLANTS SURFACE COATING
PAPER IN THE STATE OF ILLINOIS
-------
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5.0 THE ECONOMIC IMPACT OF IMPLEMENT-
ING RACT FOR PLANTS SURFACE COATING
PAPER IN THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT for plants in the State of Illinois which
are engaged in the surface coating of paper. This is meant
to include protective or decorative coatings put on paper, pressure-
sensitive tapes regardless of substrate, related web coating
processes on plastic film and decorative coatings on metal
foil, but does not include conventional printing processes which
apply inks. The chapter is divided into five sections:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Cost and VOC reduction benefit evaluations
for the most likely RACT alternatives
Direct economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines; previous studies of paper
coating; interviews with paper coaters, coating equipment and
materials manufacturers; and a review of pertinent published
literature.
5-1
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5.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impacts
for plants engaged in the surface coating of paper. The
quality of these estimates is discussed in the last part of
this section.
5.1.1 Industry Statistics
Paper coating is practiced in a number of industries.
Among products that are coated using organic solvents are:
adhesive tapes; adhesive labels; decorated, coated and
glazed paper; book covers; office copier paper; carbon
paper; typewriter ribbons; photographic film; paper cartons;
and paper drums. The firms coating paper are classified in
a number of groupings in the U.S. Department of Commerce's
Standard Industrial Classification system. The major coaters
may be found in the following 16 SIC groups:
SIC Description
2611 Pulp mills
2621 Paper mills, except building paper mills
2631 Paperboard mills
2641 Paper coating and glazing
2643 Bags, except textile bags
2645 Diecut paper and paperboard and cardboard
2649 Paper converting, n.e.c.
2651 Folding paperboard boxes
3291 Abrasive products
3292 Asbestos products
3293 Gaskets, packing and sealing devices
3497 Metal foil and leaf
3679 Electronic components, n.e.c.
3842 Orthopedic, prothetic and surgical
appliances and supplies
3861 Photographic equipment and supplies
3955 Carbon paper and inked ribbons
5-2
-------
This list does not include plants listed in the SIC category
2700 (Printing, Publishing and Allied Industries), where
paper coating other than printing may also be a part of the
overall processing of the printed product.
Statistics concerning these industries were obtained
from a number of sources. All data where possible were
converted to the base year 1977 for the state using scaling
factors developed from U.S. Department of Commerce data as
presented in County Business Patterns. The primary sources
of economic data were the 1972 Census of Manufactures
and 1976 Annual Survey of Manufactures. Industry oriented
annuals such as Lockwoods1Directory and Davidson's BlueBook
and the Thomas Register of American Manufacturers were used
to identify some of the individual companies engaged in
paper conversion (i.e., coating of paper in roll form for
sale to other manufacturers) and to identify other paper
coating firms in the state.
The final list of firms expected to be affected by the
proposed regulations was then obtained by a comparison of the
directory review with the Illinois Environmental Protection
Agency emission inventory and further confirmation by telephone
interviews with most of the firms.
5.1.2 VOC Emissions
The Illinois emission inventory was used as a basis for
estimation of the total VOC emissions to be expected in the
state. The inventory may omit a few small firms that have low
total emissions but could be affected by the RACT guideline.
5.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions from sources
included in the paper coating category are described in Control
of Volatile Organic Emissions from Existing Stationary Sources,
Volume II (EPA-450/2-77-008).The feasibility of applying the
various control methods to paper coating discussed in this docu-
ment was reviewed with coating firms, coating suppliers,
coating equipment manufacturers and industry associations.
These methods include both coating reformulation and the use of
control devices, such as incinerators and carbon adsorbers.
5-3
-------
Because of the wide variety of coating processes and
coating materials in use/ most methods of control will find
some applicability. The percentage of emissions to be con-
trolled by reformulation and by control devices was esti-
mated based on a review of the literature and on information
obtained from the interviews described above.
5.1.4 Cost of Control and Estimated Reduction of VOC
Emissions
The overall costs of control of VOC emissions in accord
with the proposed regulations were determined from:
Estimated current emissions
Estimated type of control to be used
A development of capital, operating and energy
requirements for an average-sized model installa-
tion
Extrapolation of the model plant costs to an
industry total based on current emissions.
Model plant costs were primarily based on information provided
from:
Control of Volatile Organic Emissions from Existing
Stationary Sources, Volume I (EPA-450/2-76-028)
Air Pollution Control Engineering and Cost
Study of General Surface Coating Industry, Second
Interim Report, Springborn Laboratories.
Additional cost data were supplied by equipment and material
suppliers and published literature sources. Major coaters were
consulted to determine industry views on acceptable control
methods and, in some cases, to provide direct estimates of their
projected control costs and experience in control equipment
installations.
5-4
-------
5.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements to implement RACT, assessing the
feasibility of instituting RACT controls in terms of capital
and equipment availability, comparing the direct costs of
RACT control to various state economic indicators and as-
sessing the secondary effects on market structure, employ-
ment and productivity as a result of implementing RACT
controls in Illinois.
5.1.6 Quality of Estimates
Several sources of information were utilized in as-
sessing the emissions, cost and economic impact of imple-
menting RACT controls on the surface coating of paper in
Illinois. A rating scheme is presented in this section to
indicate the quality of the data available for use in this
study. A rating of "A" indicates hard data (data that are
published for the base year), "B" indicates data that were
extrapolated from hard data and "C" indicates data that were
not available in secondary literature and were estimated
based on interviews, analysis of previous studies and best
engineering judgment. Exhibit 5-1, on the following page,
rates each study output listed and the overall quality of
the data.
5-5
-------
EXHIBIT 5-1
U.S. Environmental Protection Agency
DATA QUALITY—SURFACE COATING OF PAPER
Study Outputs
Hard Data
B
Extrapolated
Data
Estimated
Data
Industry statistics
Emissions
Cost of emissions control
X
Economic impact
X
Overall quality of data
X
Source: Booz, Allen & Hamilton Inc.
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5.2 INDUSTRY STATISTICS
Industry characteristics, statistics and trends for
paper coating in Illinois are presented in this section.
This information forms the basis for assessing the total
impact of implementing RACT for control of VOC emissions in
the state and for the effect upon individual firms. Though
there are a number of firms which coat paper as a part of
the manufacturing process, this discussion concentrates
primarily on those firms whose only major activity is paper
coating.
5-2.1 Size of the Industry
The Bureau of Census reports a total of about 563 firms
in 16 SIC categories in Illinois where paper coating, as
defined in proposed RACT guidelines, is the main business
of the firm or may be a part of its manufacturing activity.
The number of firms and other relevant statistics in each
SIC grouping are summarized in Exhibit 5-2, on the following
page.
Total value of shipments for these firms is estimated
to be about $3.4 billion, with a total of about 55,000
employees. New capital expenditures are estimated to be
about $122 million annually, based on the most recent
(1976) Annual Survey of Manufactures.
The 35 firms in SIC category 2641, those expected to be
most affected by the proposed regulations, have estimated
shipments of $257 million, with a total of 3,400 employees.
The Illinois inventory lists a total of 25 plants expected
to be covered under the paper coating RACT category.
5.2.2 Comparison of the Industry to the State Economy
A comparison of the value of shipments of plants in the
SIC categories listed above with the state economy indicates
that these plants represent about 4.5 percent of the total
value of shipments in Illinois. The industry employs 1.5
percent of all manufacturing employees in the state.
5-6
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EXHIBIT 5-2
U.S. Environmental Protection Agency
1976 INDUSTRY STATISTICS—SURFACE
COATING OF PAPER SIC GROUPS IN ILLINOIS
SIC Code
2611
2621
2631
2641
2643
2645
2649
2651
3291
3292
3293
3497
3679
3842
3861
3955
Total
Description
Pulp mills
Paper mills, except building
paper mills
Paperboard mills
Paper coating and glazing
Bags, except textile bags
Diecut paper and paperborad
and cardboard
Paper converting, n.e.c.
Folding paperboard boxes
Abrasive products
Asbestos products
Gaskets, packing and sealing
devices
Metal foil and leaf
Electronic components, n.e.c.
Orthopedic, prothetic and
surgical appliances and supplies
Photographic equipment and
supplies
Carbon paper and inked ribbons
Number
of
Plants
b
5
9
35
48
35
32
48
37
8
40
7
122
52
80
5
563
Total
Number of
Employees
b
588
1,475
3,432
4,814
1,428
1,500
3,882
2,161
1,205
6,677
725
11,360
7,071
8,679
340
55,337
Total
Payroll
($1,000)
b
8,952
20,714
42,942
54,446
17,190
c
52,694
26,610
15,095
84,648
7,851
116,257
92,792
117,689
4,690
662,570
Estimated Value
of Shipments3
($1,000)
b
53,300
137,200
257,100
334,000
104,200
84,000
236,000
390,000
77,400
288,900
20,000
425,900
373,600
600,500
30,100
3,420,800
Estimated
New Expenditures'
($1,000)
b
4,700
17,100
7,700
9,500
2,900
1,600
6,100
12,100
1,500
10,100
900
17,400
12,700
23,400
500
128,200
a. Estimated by using ratios of (value of shipment/total salary and wages) and (capital expenditures/total salary and wages) for each SIC group
as published in 1976 Annual Survey of Manufactures
b. None listed.
c. Not listed to protect proprietary information.
Source! Booz, Allen & Hamilton Inc.: 1976 County Business Patterns, and Annual Survey of Manufactures, U.S. Department of Commerce
-------
5.2.3 Historical and Future Patterns of the Industry
The nationwide value of shipments in the industries expected
to be affected by the proposed paper coating regulations, in
general, exceed the growth rate of the economy. As summarized in
Exhibit 5-3, on the following page, the value of shipments
increased in every category between 1972 and 1976, with an average
annual growth rate of about 12.1 percent over the period. Com-
pared to an average inflationary rate of 6 to 8 percent, this is
equivalent to a real growth rate of 4 to 6 percent. In some
individual categories, growth rates were even greater. Paper
production increased by an uncorrected average annual growth
rate of 16.5 percent; metal and foil by 16 percent; paper
coating and glazing by about 12 percent, only slightly less
than the average.
It is expected that the growth rate will continue at
these rates for the near future.
5-7
-------
EXHIBIT 5-3
U.S. Environmental Protection Agency
HISTORICAL TRENDS IN VALUE OF SHIPMENTS OF
U.S. PLANTS ENGAGED IN PAPER COATING ($ millions)
SIC Code
2611
2621
2631
2641
2643
2645
2649
2651
3291
3292
3293
3499
3679
3842
3861
3955
Total
1972
710
6,385
4,153
1,954
1,886
676
631
1,487
888
763
665
702
3,060
1,450
5,624
237
31,271
1973
849
7,514
4,862
2,284
2,183
747
833
1,644
1,067
823
723
753
3,430
1,620
6,435
268
36,035
1974
1,525
9,942
6,516
2,645
2,867
923
1,079
1,890
1,235
963
835
973
3,210
1,800
7,490
309
42,400
1975
1,630
9,650
6,055
2,626
2,980
943
1,090
1,952
1,222
900
843
1,065
3,450
2,090
7,627
285
44,408
1976
2,055
11,768
6,724
3,074
3,379
1,027
1,288
2,223
1,433
988
1,020
1,267
4,120
2,240
8,844
294
51,744
Source:T976 Annual Survey of Manufactures, U.S. Department of Commerce.
-------
5.3 TECHNICAL SITUATION IN THE INDUSTRY
This section presents a description of the principal
processes used in the surface coating of paper and similar
products proposed to be included under the RACT Surface
Coating of Paper regulations. These products include a myriad
of consumer and industry oriented items, such as pressure-
sensitive tapes, adhesive labels, book covers, milk cartons,
flexible packaging materials and photographic film. As
indicated earlier, in Illinois, about 25 plants were identified
as producers of such products, which are coated by processes
covered under this RACT category not including those which may
be classified under publishing or printing. Also discussed
are estimated VOC emissions for the state and extent of con-
trols in current use.
5.3.1 General Coating Process Description
In organic solvent paper coating, resins are dissolved
in an organic solvent mixture and this solution is applied
to a web (continuous roll) of paper. As the coated web is
dried, the solvent evaporates and the coating cures. An
organic solvent has several advantages: it will dissolve
organic resins that are not soluble in water, its components
can be changed to control drying rate, and the coatings show
superior water resistance and better mechanical properties
than most types of waterborne coatings. In addition, a
large variety of surface textures can be obtained using
solvent coatings.
Most organic-solvent-borne coating is done by paper
converting companies that buy paper from the mills and apply
coatings to produce a final product. The paper mills them-
selves sometimes apply coatings, but these are usually
waterborne coatings consisting of a pigment (such as clay)
and a binder (such as starch or casein). However, much
additional coating is done by firms only as part of the
manufacturing process. For instance, many printed items
(e.g., periodical covers, playing cards and cartons) are
printed first and then coated in the printing plant with a
protective coating which can provide abrasion resistance,
water resistance or decorative effects.
5-8
-------
Nationwide emissions of organic solvents from paper
coating have been estimated to be 0.56 million tons per
year.1 This estimate includes resin emissions from sol-
ventless polyethylene extrusion coatings applied to milk
cartons and resin emissions from water emulsion coatings and
from rubber adhesives used to glue paper bags and boxes. A
lower estimate, based on solvent emissions from the type of
coating operations found in SIC 2641, is 0.35 million tons
per year. The true total emission rate, however, is probably
closer to the 0.56 million tons per year value. This is
slightly less than 3.0 percent of the estimate of 19 million
tons per year of hydrocarbon emissions from all stationary
sources previously reported by EPA.2 Manufacturing of
pressure-sensitive tapes and labels, the largest single sol-
vent emission source in SIC 2641, alone accounts for 0.29
million tons per year.
Solvent emissions from an individual coating facility
will vary with the size and number of coating lines. A
plant may have one or as many as 20 coating lines. Uncon-
trolled emissions from a single line may vary from 50 pounds
per hour to 1,000 pounds per hour, depending on the line
size. The amount of solvent emitted also depends on the
number of hours the line operates each day.
Exhibit 5-4, on the following page, gives typical
emission data from various paper coating applications.
5.3.2 Nature of Coating Materials Used
The formulations usually used in organic-solvent-borne
paper coatings may be divided into the following classes:
film-forming materials, plasticizers, pigments and solvents.
Dozens of organic solvents are used. The major ones are:
toluene, xylene, methyl ethyl ketone, isopropyl alcohol,
methanol, acetone and ethanol.
Although a single solvent is frequently used, often a
solvent mixture is necessary to obtain the optimum drying
rate. Too rapid drying results in bubbles and an "orange
peel" effect in the coating; whereas, slow drying coatings
require more time in the ovens or slower production rates.
Variations in the solvent mixture also affect the solvent
qualities of the mix.
1. T. W., Hughes, et al., Source Assessment: Prioritization
of Air Pollution from Industrial Surface Coating Operations,
Monsanto Research Corporation, Dayton, Ohio. Prepared
for U.S. Environmental Protection Agency, Research Triangle
Park, N.C., under Contract No. 68-02-1320 (Tech. 14)
Publication No. 650/2-75-019a.
2. EPA-450/2-76-028, Op. Cit.
5-9
-------
EXHIBIT 5-4
U.S. Environmental Protection Agency
EMISSION DATA FROM TYPICAL PAPER COATING PLANTS3
Number
of coating Solvent
lines Usage
(Ib./day)
2 10,000
5 15,000
8 9,000
2 1,200
10 24,000
20 55,000
3 5,000
3 21,000
1 10,500
Solvent Control
Emissions Efficiency (%)"
(Ib.day)
10,000
15,000
9,000
1,200
950 96
41,000 90
1,500 90
840 96
500 96
Control
Device
None
None
None
None
Carbon
adsorption
Carbon
adsorption
(not all lines
controlled)
Carbon
adsorption
Carbon
adsorption
Afterburner
a. Data are based on EPA sponsored survey of actual paper coating plants.
b. Neglecting emissions that are not captured in the hooding system.
Source: Control of Volatile Organic Emission from Existing Stationary Sources (EPA-450/2-77-008).
-------
The main classes of film formers used in conventional
paper coating are cellulose derivatives and vinyl resins.
The most commonly used cellulose derivative, nitrocellulose
has been used for paper coating decorative paper, book
covers and similar items since the 1920s. It is relatively
easy to formulate and handle, and it dries quickly, allowing
lower oven temperatures than vinyl coatings. The most
common vinyl resin is the copolymer of vinyl chloride and
vinyl acetate. These vinyl copolymers are superior to
nitrocellulose in toughness, flexibility and abrasion re-
sistance. They also show good resistance to acids, alkyds,
alcohols and greases. Vinyl coatings tend to retain solvent,
however, so that comparatively high temperatures are needed.
In general, nitrocellulose is most applicable to the dec-
orative paper field, whereas vinyl copolymers are used for
functional papers, such as some packaging materials.
In the production of pressure-sensitive tapes and
labels, adhesives and silicone release agents are applied
using an organic solvent carrier. The adhesive layer is
usually natural or synthetic rubber, acrylic or silicone.
Because of their low cost, natural and synthetic rubber
compounds are the main film formers used for adhesives in
pressure-sensitive tapes and labels, although acrylic and
silicone adhesives offer performance advantages for certain
applications. In most cases tapes and labels also involve
the use of release agents applied to a label carrier or the
backside of tape to allow release. The agents are usually
silicone compounds applied in a dilute solvent solution.
5.3.3 Coating Process Most Commonly Used
Exhibit 5-5, on the following page, shows a typical
paper coating line. Components include an unwind roll, a
coating applicator (knife, reverse roll or gravure), an
oven, various tension and chill rolls and a rewind roll.
The unwind, rewind and tension rolls display various degrees
of complexity, depending on the design of the line.
The coating applicator and the oven are the main areas
of organic emission in the paper coating facility.
Coatings may be applied to paper in several ways. The
main application devices are knives, reverse rollers or
rotogravure devices.
A knife coater (Exhibit 5-6, following Exhibit 5-5)
consists of a blade that scrapes off excess coating on the
paper. The position of the knife (relative to the paper
surface) can be adjusted to control the thickness of the
coating. The knife coater is simply constructed and easy to
clean.
5-10
-------
EXHIBIT 5-5
U.S. Environmental Protection Agency
TYPICAL PAPER COATING LINE
ZONE1
EXHAUST
ZONE 2
EXHAUST
HEATED AIR
FROM BURNER
REVERSE ROLL
COATER
UNWIND
\
HOT AIR NOZZLES
TT
TENSION ROLLS
REWIND
Source; Control of Volatile Organic Emissions from Existing Stationary Sources, Volume II;
Surface Coating of Cans, CoTIs , Papery Fabrics r^Auhoniobilos^ nnd _Light-
Duty Trucks, " EPA "450/2-77-008, MayTT977 ~~ ~ '''
-------
EXHIBIT 5- 6
U.S. Environmental ^Protection Agency
KNIFE COATER
EXCESS COATING
ILADE
COATED WEB
PAPER WEB
Source: Control of Volatile Organic Emissions from Existing Stationary Sources, Volume II;
Surface Coatfng of cfans, Coils, Taper, fabrics ,_Xutomob i los, and Light-
Duty Trucks, EPA 45Q~/2-77-008, "May, 1977"'
-------
The reverse roll coater (Exhibit 5-7, on the following
page) applies a constant thickness of coating to the paper
web, usually by means of three rolls, each rotating in the
same direction. A transfer roll picks up the coating solu-
tion from a trough and transfers it to a coating roll.
(Sometimes there is no transfer roll and the coating is
pumped directly onto a coating roll.) A "doctor roll"
removes excess material from the coating roll. The gap
between the doctor roll and the coating roll determines the
thickness of the coating. The web is supported by a rubber
backing roll where the coating roll contacts the paper. The
coating roll turns in a direction opposite to that of the
paper, hence the name "reverse roll." This reverse direction
of the coating roll reduces striations in the coating that
can form if the coating roll is turned in the same direction
as the paper web.
Knife coaters can apply solutions of much higher vis-
cosity than roll coaters and thus, less solvent is emitted
per pound of coating applied. Knife coaters handle coatings
with viscosity up to 10,000 centipoise (cp). Reverse roll
coaters operate best in a much more dilute range, where
viscosity is 300 to 1,500 cp. Roll coaters, however, can
usually operate at higher speeds and show less tendency to
break the paper.
Rotogravure, another type of application method used by
paper coaters, is usually considered a printing operation.
With it, the image area on the coating or rotogravure roll
is recessed relative to the nonimage area. The coating is
picked up in the recessed area of the roll and transferred
directly to the substrate. The gravure printer can print
patterns or a solid sheet of color on a paper web. Roto-
gravure can also be used to apply materials, such as silicone
release coatings for pressure-sensitive tapes and labels.
Because of the similarities, the regulation is applicable to
gravure as well as knife and roll coating.
Most solvent emissions from coating paper come from the
dryer or oven. Ovens range from 20 feet to 200 feet in
length and may be divided into two to five temperature
zones. The first zone, where the coated paper enters the
oven, is usually at a low temperature (IIO^F). Solvent
emissions are highest in this zone. Other zones have
progressively higher temperatures that cure the coating
after most of the solvent has evaporated. The typical
curing temperature is 250°F, although in some ovens tem-
peratures of 400°F are reached. This is generally the
maximum because higher temperatures can damage the paper.
Exhaust streams from oven zones may be discharged indepen-
dently to the atmosphere or into a common exhaust and sent
to some type of air pollution control device. The average
exhaust temperature is about 200°F.
5-11
-------
EXHIBIT 5-r7,
U.S. Environmental Protection Agency
REVERSE ROLL COATER
DOCTOR ROLL
METERING GAP
TRANSFER ROLL
COATED PAPER WEI
BACKING ROIL
COATING RESERVOIR
Source; Control of Volatile Organic Emissions from Existing Stationary Sources,
Volume II; Surface Coating of Cans, Coils/ Paper, Fabrics, Automobiles,
and Light-Duty Trucks, EPA 450/2-77-008, May, 1977
-------
However, in some coatings, such as in the manufacture
of photographic films or thermographic recording paper, the
heat sensitivity of the films requires that temperatures
considerably lower than this must be used. Exhaust temper-
atures may be as low as 100°F. Thus, much larger relative
volumes of air must be used than is possible with common
paper coating.
5.3.3 Current VOC Emissions
This section presents the estimated VOC emissions from
paper coating operations in Illinois for the year 1977,
based on the inventory of air pollution sources. A summary
of this inventory and applicable emissions for the paper coat-
ing RACT category is presented in Exhibit 5-8, on the following
page. The plants listed are believed to represent the major
sources of emissions in the state and in total represent the
major portion (probably 80 percent to 90 percent) of paper
coating emissions.
5.3.4 RACT Guidelines
The RACT guidelines1 for control of VOC emissions from
the surface coating of paper require that emission dis-
charges of VOCs be limited to 2.9 pounds per gallon of
coating material delivered to the coating applicator.
The recommended methods of achieving this requirement
are:
The application of low solvent content coatings;
or
Incineration, provided that 90 percent of the
nonmethane VOCs (measured as combustible carbon)
which enter the incinerator are oxidized to carbon
dioxide and water; or
A system demonstrated to have control efficiency
equivalent to or greater than provided by either
of the above methods.
In the following section are discussed several methods
of low solvent and solventless systems, which have been
demonstrated to be applicable to some paper coating prod-
ucts, and the two principal add-on systems, incineration and
carbon adsorption, generally used for emission control.
This information has been extracted principally from the
previously cited EPA report, Control of Volatile Organic
Emissions from Existing Stationary Sources, Volume II, which
should be consulted for a more thorough discussion. In some
instances, additional comment was obtained from coaters,
coating material suppliers and control equipment manufacturers.
3TI Regulatory Guidance for Control of Volatile Organic Compounds
from 15 Categories of Stationary Sources, EPA-905/2-78-001
5-12
-------
EXHIBIT 5-8
U.S. Environmental Protection Agency
PLANTS EXPECTED TO BE AFFECTED BY PAPER COATINGS
RACT REGULATIONS IN ILLINOIS
Plant
American Decal Mfg. Co.
Arvey Corp.
Bogcraft Corp. of
America
Borden Chemical Co.
Chicago Decal Co.
Cromwell Paper Co.
Dietzgen Corp.
Diamond T. Packaging
Corp.
Engineered Coated
Products, Inc.
International Paper Co.
Joanna Western Mills
Kencote Laminations,
Inc.
Ludlow Corp.
Meyercord
3M Company
Nabisco
Nashua
Paper Converting Corp.
H.P. Smith Paper Co.
Standard Packaging
Teledyne Post
Tuck Industries
Heber Marking Systems
Weber Valentine Co.
Weldon Industries
Location
Employees
Chicago
Chicago
Chicago
Winnetka
Chicago
Chicago
Des Plainea
Addison
300
185
600
500
50
175
250
35
Northbrook
10
Type Of
Control Now Used
None
None
None
Incinerator
None
None
None
None
None
Total Emissions
(tons/yr.)
310
29
477
6,966
205
3
832
5
245
Peoria
Chicago
Lake Bluff
Chicago
Carol Stream
Bedford Park
Marseilles
Chicago
Chicago
Chicago
Elgin
Chicago
Carbondale
Arlington Hts.
Elk Grove
Harvey
365
850
15
100
500
2,240
280
300
110
350
100
35
1,600
400
75
15
None
None
None
Incinerator
None
Incinerator
None
None
None
None
None
None
Carbon Adsorption
Carbon Adsorption
None
None
936
138
24
191
346
11,748
2,476
690
6,873
535
126
1,032
272
42
1
4
Total
Applicable Emissions
(tons/yr.)
310
29
477
6,873
205
3
832
S
245
936
138
24
182
346
11,684
2,476
690
6,873
535
126
1,032
0
0
1
4
Coated Paper Products
Produced At Plant
Decalomania
Gummed labels
Coated paper and foils
Pressure sensitive tapes
Decalomania
Specialty coated paper and
tapes
Drafting and copying papers
Coated and laminated papers
Laminated paper and foils
Labels
Vinyl and pyroxylin coated
papers
Coated and laminiated papers
Pressure sensitive papers,
films, tapes
Decalomania, pressure
sensitive films
Pressure sensitive tapes
Display cartons
Coated paper and paper board
Coated paper and paper board
Coated and laminated papers
Laminated papers and foils
Drafting and copying papers
Pressure sensitive tapes
Labels
Drafting and copying papers
Pressure sensitive papers
and films
9,440
27,749
27,269
Source: Booz, Allen S Hamilton Inc., Illinois EPA emission data, Illinois Directory of Manufacturers.
-------
5.3.5 Low Solvent and Solventless Coatings
In Exhibit 5-9, on the following page, are listed
several types of coating materials, which have found utility
in paper coating, and an estimate of expected solvent reduction.
5.3.5.1 Waterborne Coatings
Waterborne coatings have long been used in coating
paper to improve printability and gloss. The most widely
used types of waterborne coatings consist of an inorganic
pigment and nonvolatile adhesive. These waterborne coatings
are useful but cannot compete with organic solvent coatings
in properties such as weather, scuff and chemical resistance.
Newer waterborne coatings have been developed in which a
synthetic insoluble polymer is carried in water as a colloidal
dispersion or an emulsion. This is a two-phase system in
which water is the continuous phase and the polymer resin is
the dispersed phase. When the water is evaporated and the
coating cured, the polymer forms a film that has properties
similar to those obtained from organic-solvent-based coatings.
5.3.5.2 Plastisols and Organisols
Plastisols are a colloidal dispersion of synthetic
resin in a plasticizer. When the plasticizer is heated, the
resin particles are solvated by the plasticizer so that they
fuse together to form a continuous film. Plastisols usually
contain little or no solvent, but sometimes the addition of a
filler or pigment will change the viscosity so that organic
solvents must be added to obtain desirable flow character-
istics. When the volatile content of a plastisol exceeds 5
percent of the total weight, it is referred to as an organisol.
Paper is coated with plastisols to make such products
as artificial leather goods, book covers, carbon paper and
components of automobile interiors. Plastisols may be
applied by a variety of means, but the most common method is
probably reverse roll coating. One advantage of plastisols
is that they can be applied in layers up to 1/8 thick. This
avoids the necessity of multiple passes through a coating
machine.
5-13
-------
EXHIBIT 5-9
U.S. Environmental Protection Agency
ACHIEVABLE SOLVENT REDUCTIONS USING LOW
SOLVENT COATINGS IN PAPER COATING INDUSTRY
Type of Low Solvent-Coating
Waterborne coatings
Plastisols
Hot melts
Extrusion coatings
Pressure-sensitive adhesives
Waterborne
Hot melts
Prepolymer
Silicone release agents
100 percent nonvolatile coatings
Waterborne emulsions
Reduction Achievable (%)a
80-99
95-99
99+
99+
80-99
99
99
99+
80-99
a. Based on comparison with a conventional coating containing 35 percent solids by volume
and 65 percent organic solvent by volume.
Source: EPA 450/2-77-008, op. cut.
-------
5.3.5.3 Hot Melt Coatings
Hot melt coatings contain no solvent; the polymer resins
are applied in a molten state to the paper surfaces. All the
materials deposited on the paper remain as part of the coating.
Because the hot melt cools to a solid coating soon after it is
applied, a drying oven is not needed to evaporate solvent or to
cure the coating. Energy that would have been used to heat an
oven and to heat makeup air to replace oven exhaust is therefore
saved. Considerable floor space is also saved when an oven is
not used. In addition, the paper line speed can be increased
because the hot melt coating cools faster than a solvent coat-
ing can dry.
One disadvantage with hot melt coatings is that materials that
char or burn when heated cannot be applied by hot melt. Other
materials will slowly degrade when they are held at the necessary
elevated temperatures.
Hot melts may be applied by heated gravure or roll coaters
and are usually applied at temperatures from 150°F to 450°F.
The materials with a lower melting point are generally waxy
materials with resins added to increase gloss and hardness. The
materials with a higher melting point form films that have superior
scuff resistance, transparency and gloss. These coatings form
excellent decorative finishes. One particular advantage of
hot melts is that a smooth finish can be applied over a rough
textured paper. This is possible because the hot melt does not
penetrate into the pores of the paper.
5.3.5.4 Extrusion Coatings
A type of hot melt coating, plastic extrusion coating is a
solventless system in which a molten thermoplastic sheet is
discharged from a slotted dye onto a substrate of paper, paper-
board or snythetic material. The moving substrate and molten
plastic are combined in a nip between a rubber roll and a chill
roll. A screw-type extruder extrudes the coating at a temperature
sometimes as high as 600°F. Low and medium density polyethylene
are used for extrusion coating more than any other types of resins.
5-14
-------
5.3.5.5 Pressure-Sensitive Adhesive Coatings
In 1974, sales of pressure-sensitive adhesives in the
United States exceeded $1 billion, and the growth rate was
about 15 percent per year. Products using pressure-sensitive
adhesives include tapes and labels, vinyl wall coverings and
floor tiles. Nationwide, organic solvent emissions from
pressure-sensitive tape and label manufacture have been esti-
mated to be 580 million pounds per year.
Waterborne adhesives have the advantage that they can be
applied with conventional coating equipment. Waterborne emul-
sions, which can be applied less expensively than can solvent-
borne rubber-based adhesives, are already in use for pressure-
sensitive labels. A problem with Waterborne adhesives is that
they tend to cause the paper substrate to curl and wrinkle.
Pressure-sensitive hot melts currently being marketed
consist mostly of styrene-butadiene rubber block copolymers.
Some acrylic resins are used, but these are more expensive. The
capital expense of hot melt coating equipment is a problem for
paper coaters that have already invested heavily in conventional
solvent coating equipment.
Prepolymer adhesive coatings are applied as a liquid
composed of monomers containing no solvent. The monomers
are polymerized by either heat or radiation. These prepolymer
systems show promise, but they are presently in a developmental
stage only.
5.3.5.6 Silicone Release Coatings
Silicone release coatings, usually solventborne, are
sometimes used for pressure-sensitive, adhesive-coated products.
Two low-solvent alternatives are currently on the market. The
first is a 100 percent nonvolatile coating which is usually
heatcured, but may be radiation cured. This is a prepolymer
coating which is applied as a liquid monomer that is crosslinked
by the curing process to form a solid film. The second system
is water emulsion coatings which is lower in cost than the pre-
polymer coating. However, because of wrinkling and other applica-
tion problems the waterborne coating may be of limited value.
Some silicone coating materials which are under development
use single solvent systems that can be readily recovered by car-
bon adsorption. Current coatings are troublesome since some
silicone is carried into the adsorber where it clogs the carbon
pores to reduce adsorption efficiency.
5-15
-------
5.3.6 Incineration
Catalytic and direct thermal incineration processes convert
hydrocarbons to carbon dioxide and water at high temperatures.
Incineration is widely accepted as a reliable means of reducing
hydrocarbon emissions by 90 percent or more.
Generally, the major disadvantage of this approach is
the increased energy required to raise the exhaust gas tem-
peratures above 1,200°F for direct incineration and 700°F
for catalytic incineration. Natural gas is the most commonly
used fuel though fuel oils, propane or other fluid hydrocarbons
can be employed. Fuel oil is not generally acceptable because
of the sulfur oxides generated in combustion or possible catalyst
poisoning in the oil. Another problem is the generation of
nitrogen oxides in direct fired incinerators because of the
exposure of air to high-temperature flames.
The increased energy consumption can, in some cases, be
reduced or eliminated by heat exchange of the exhaust gases with
fresh emissions (primary heat recovery) or by use of the hot in-
cinerator exhaust gases in process applications (secondary heat
recovery). Typical use of secondary heat recovery is for oven
heat in drying or baking ovens. In fact, with efficient primary
exchange and secondary heat recovery, total fuel consumption of
an incinerator-oven system can be less than that for the oven
before the incinerator is added. The heat required to sustain
the system comes from the combustion of the volatile organic
compounds in the exhausts.
Both catalytic and direct fired systems are capable of
high heat recovery efficiency if several conditions occur:
VOC concentrations are or can be increased
to 8-10 percent or more of their LEL
(lower explosion limit).
Oven temperatures are sufficiently high to
be able to use most of the sensible heat in the
exhaust gases after primary heat exchange.
Usually, temperatures above 140°F to 150°F can
be sufficient to allow 85 percent or more over-
all heat recovery.
Where catalytic incinerators are used, no
compounds must be present in the gases
treated which could poison or blind the
catalyst.
5-16
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In most paper coating operations, except for heat-sensitive
products such as photographic paper and film, these condi-
tions can be met. In other cases, 50-85 percent primary
heat recovery can be attained and at least a portion of the
incinerator exhaust heat can be used for in-plant energy
requirements.
Paper coaters who use coating machinery for a multi-
plicity of processes have commented that catalytic incin-
eration would probably not be used because of the possibility
of catalyst poisoning. Direct fired incineration would be
used.
5.3.7 Carbon Adsorption
Carbon adsorption has been used since the 1930s for
collecting solvents emitted from paper coating operations.
Most operational systems on paper coating lines were in-
stalled because they were profitable. Pollution control has
usually been a minor concern. Carbon adsorption systems at
existing paper coating plants range in size from 19,000 scfm
to 60,000 scfm. Exhausts from several paper coating lines
are often manifolded together to permit one carbon adsorption
unit to serve several coating lines. Paper products that
are now made on carbon-adsorption-controlled lines include
pressure-sensitive tape, office copier paper and decorative
paper.
Carbon adsorption is most adaptable to single solvent
processes. Many coaters using carbon adsorption have re-
formulated their coatings so that only one solvent is re-
quired. Toluene, a widely used solvent for paper coating,
is readily captured in carbon adsorption systems.
The greatest obstacle to the economical use of carbon
adsorption is that, in some cases, reusing recovered sol-
vents may be difficult. In many coating formulations, a
mixture of several solvents is needed to attain the desired
solvency and evaporation rates. Also if different coating
lines within the plant use different solvents and are all
ducted to one carbon adsorption system, then there may be
difficulty reusing the collected solvent mixture. In some
cases, such as in the preparation of photographic films or
thermographic recording paper, extremely high purity sol-
vents are necessary to maintain product performance and even
distillation may be insufficient to produce the quality of
recovered solvent needed. For most other coating formulations,
distillation is adequate.
5-17
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Separation of solvent mixtures by distillation is a
well-established technology and several plants are already
doing this. One paper coating plant has been using such
distillation procedures since 1934. Distillation equipment
can be expensive, however, and it is hard to build flexibility
into a distillation system. Flexibility is needed because
many paper coaters, especially those who do custom work for
others, are constantly changing solvent formulations.
However, in some plants where mixed solvents are used,
azeotropic mixtures can occur which can be separated only by
specialized techniques. Even large coaters have commented
that they did not have the knowledge at hand necessary for
the complex distillation and separation procedures needed.
Another problem with carbon adsorption is the potential
of generating explosive conditions in the adsorber because
of the localized increases in combustible organic material
concentrations. Ignition apparently can be caused by static
electricity in systems where dry air at high flow rates is
treated. Several explosions of absorbers have been reported
in paper coating and other plants.
Also, adsorption of solvents containing water soluble
compounds (such as alcohols, ketones or esters) can present
a secondary pollution problem where steam is used for re-
generation. Additional treatment of the condensed steam
with its content of dissolved organics would be required,
increasing the complexity of the solvent recovery system and
its cost.
5-18
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5.4 COST AND VOC REDUCTION BENEFIT EVALUATIONS
FOR THE MOST LIKELY RACT ALTERNATIVES
This section discusses the projected costs of control
for paper coating in the state, based on the emission in-
ventory developed by the Illinois Environmental Protection
Agency and information developed by EPA sources. Where
possible, the validity of the costs were confirmed with
coating firms and equipment manufacturers.
Though some coaters will substitute low solvent or
solventless coating for current high solvent systems, no
reliable information was available to estimate the amount of
such coatings which might be used. Several coaters also
commented that though they had low solvent coatings under
development the coatings would not be sufficiently evaluated
to meet proposed compliance schedules. Therefore, it has
been assumed (for cost estimating purposes) that either incin-
eration or carbon adsorption will be used to comply with the
proposed regulations.
5.4.1 Costs of Alternative Control Systems
Exhibits 5-10 and 5-11, on the following pages, present
costs for typical incineration and carbon adsorption systems
as developed by EPA sources. Both systems are based on the
assumption that exhaust air flow rates can be reduced suf-
ficiently to attain LEL levels of 25 percent. This is
possible with well-designed ovens where excess air can be
reduced or where product characteristics allow.
Several paper coaters indicate that this may not be
possible with older coating lines or with certain types of
coating. Coating drying rate is a function of air^flow
rate, temperature and vapor concentration in the air. If
air flow rates are to be reduced, drying temperatures or
drying times must be increased. Because of the heat sen-
sitivity of some coating, temperature increases may not be
possible. Increase in drying time will necessitate either
more time in the ovens or reduced production rates. Several
coaters of heat sensitive products indicated that in order
to achieve special characteristics they could not increase
emission concentrations above 5 to 6 percent of LEL and
could not use oven temperatures above 140°F. Plants manu-
facturing conventional coated products, however, can de-
crease air flow rates sufficiently to increase VOC con-
centrations in the exhausts to 40-50 percent with only
moderate increases in temperatures or changes in production
rates. We have assumed for cost estimation purposes that a
25 percent LEL can be attained on the average.
5-19
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EXHIBIT 5-10 -
U.S. Environmental Protection Agency
INCINEPJVTION COSTS FOR A TYPICAL PAPER
COATING OPERATION
Incineration Device
No heat recovery
Catalytic
Noncatalytic
(Afterburner)
Installed Cost
($)
155,000
125,000
Annualized Cost
(S/yr.)
100,000
105,000
Control Cost
($/ton of solvents
recovered)
51
54
Primary heat
recovery
Catalytic
Noncatalytic
(Afterburner)
180,000
150,000
75,000
66,000
39
34
Primary and
secondary heat
recovery
Catalytic
Noncatalytic
(Afterburner)
220,000
183,000
54,000a
26,000a
28*
13*
Note: Typical operation parameters are: process rate of 15,000 scfm; temperature of 300°F,
operation at 25 percent of LEG. See Volume I, Chapter 4, for costs for other
operating parameters. Costs are believed to be valid only for mid-1974.
a. Assumes heat is recovered and used at a total heat recovery of 70 percent.
Source: EPA-450/2-76-028
-------
EXHIBIT 5-11 -
U.S. Environmental Protection Agency
CARBON ADSORPTION COSTS FOR PAPER COATING INDUSTRY
No credit for recovered
solvent
Installed Cost
($)
320,000
Annualized Cost
(S/yr.)
127,000
Control Cost
($ ton of solvent
recovered)
125
Recovered solvent credited
at fuel value
320,000
60,000
40
Solvent credited at market
320,000
(100,000)a
(50)a
Note: Operating parameters are: process rate of 15,000 scfm, temperature of 170°F,
operation at 25 percent of LEC. See Volume I, Chapter 4, for details on cost
estimates. Costs are believed to be valid only for mid-1974.
a. Costs in parenthesis indicate a net gain.
Source: EPA-450/2-76-028
-------
Both incinerator costs and adsorber costs are a func-
tion of equipment size and vary generally with air flow
rate. It was assumed for projection of overall costs in the
state that control equipment, on the average, would be sized
for 15,000 scfm per unit. In most plants, it is impractical
to manifold exhausts so that all exhausts could be treated
in one add-on emission control system. In the case of
incinerators, it would be difficult to use secondary heat
recovery on ovens where the incinerator is remote from the
oven.
The major problem in estimating total installed costs
of control systems is the added cost of installation. The EPA
estimates were made on the assumption of an easily retrofitted
system. In practice, coaters have found actual installed costs
to be three to five times those summarized in Exhibits 5-10
and 5-11, which are based on costs in EPA 450/2-76-028, Control
of Volatile Organic Emissions from Existing Stationary Sources.
The differences, other than for inflation caused cost
increases, result from varying retrofit situations. In essen-
tially all cases, the plants affected are old; installation of
new air handling systems, coating line enclosure, possible
need for new ovens or other emission collection systems can be
a sizeable portion of the cost of an overall emission control
system. For instance, in one plant where a catalytic incinera-
tor with secondary heat recovery was installed, total project
cost was about five times the base price of the incinerator.
The major cost was not the incinerator but the requirement for
new ovens for emission collection.
The experience of E.I. DuPont de Nemours and of equipment
manufacturers also illustrate the need to increase these previous
EPA estimates. E.I. DuPont de Nemours, based on their experience
on actual installed equipment, estimates1 $1.2 million for a
carbon adsorber to treat 15,000 scfm of exhaust gases. Recent
prices from manufacturers of recuperative-type incinerators
for a 15,000 scfm direct-fired, ceramic bed primary recuperative
heat exchanger are about $150,000 for the incinerator alone;
installed costs, with provision for return of exhausts for
secondary heat recovery, are estimated to be more than $300,000.
The estimates in Exhibits 5-10 and 5-11 indicate installed costs
of $320,000 for an equivalent adsorber, and $140,000 for the
incinerator.
1T.A. Kittleman and A.B. Akell, "The Cost of Controlling Organic
Emissions," Chemical Engineering Progress, April 1978.
2Discussions with REECO, Inc., Morris Plains, N.J. and Bobst-
Champlain, Roseland, N.J.
5-20
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5.4.2 Estimated Statewide Costs
The total emissions considered to be applicable under RACT,
as tabulated in Exhibit 5-8, are about 27,300 tons per year. In
developing estimated costs of compliance by affected coaters, it
was assumed that 75 percent of emissions would be controlled by
incineration and the remaining 25 percent by carbon adsorption.
In some cases, coaters would prefer to use low solvent or water-
based coatings since these promise lower overall operating costs.
However, since development of coatings and evaluation of coated
products would require several years, it is not likely that use
of these coating materials will have significant impact on control
costs, if current compliance deadlines are to be met. The study
team, therefore, considers that add-on control devices are the
most likely method of control to be used to meet compliance dead-
lines and that, based on discussions with coaters, a 75 percent
to 25 percent apportioning of incineration or carbon adsorption
is the most appropriate. Mode of compliance can be identified
further only by a detailed examination of the processes and coating
materials used at each location and by in-depth cost analyses of
compliance alternatives.
Based on the Illinois emission inventory, it is estimated
that 150 uncontrolled emission sources from the paper coating
plant are affected. It was assumed that an average of at least
two sources could be combined and emissions ducted into a single
incinerator or carbon adsorber. This assumption, combined with
the assumption that the firms can reduce air flow to achieve 25
percent of the LEL, led to the estimation of compliance costs based
on a total of 75 add-on control devices—19 carbon adsorbers and
56 incinerators—at an average flow rate of 2,800 SCFM. With
incinerators assumed to provide only primary heat recovery and
carbon adsorbers to have recovered solvent valued at fuel prices,
costs were then obtained from Control of Volatile Organic Emis-
sions from Existing Stationary Sources, Vol. I: Control Methods
for Surface-Coating Operations, EPA-450/2-76-028.Key assumptions
used here and in this report are summarized in Exhibit 5-12, on the
following page.
These base costs were modified by multiplying capital costs
by a factor of three and four and adjusting annual costs for in-
flation and the increased capital costs. As discussed above in
Section 5.4.1, the base costs in the EPA-450/2-76-028 report are
low by a factor of three to four, since they do not reflect diffi-
cult retrodfit factors and other capital requirements in a complete
emission control system and require updating to 1977.
5-21
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EXHIBIT 5-12
U.S. Environmental Protection Agency
SUMMARY OF ASSUMPTIONS USED IN COST ESTIMATE
Assumptions
75 percent of emissions are controlled by incineration with primary heat
recovery; only 25 percent by carbon adsorption with recovered
solvent credited at fuel prices.
25 percent LEL is equal to 3,000 ppm of toluene by volume.
Air flow can be reduced to reach 25 percent LEL.
The price of a 2,800 SCFM system can be used as an average. No costs are
added for distillation or additional waste disposal for carbon adsorption.
27,300 tons of emissions are treated per year over an operating period of
5,840 hours per year.
Other assumptions regarding incinerator and adsorber prices, as estimated in
Control of Volatile Organic Emissions from Existing Stationary Sources,
Vol. I: Control Methods for Surface-Coating Operations, EPA-450/2-76-028,
are valid.
Source: Booz, Allen & Hamilton Inc.
-------
Using these cost estimating procedures, total capital
costs of compliance are estimated to range from $27 million
to $36 million, with equivalent annualized costs of $6.7 million
to $9.6 million. As stated earlier in this report, total emission
sources identified probably represent at least 90 percent of the
paper coaters identified. These costs similarly are expected
to represent at least 90 percent or better of the papercoating
RACT compliance costs for the state.
5.4.3 Estimated Emission Reduction
Assuming that 90 percent of all solvents used in coating
operations can be collected by properly designed hoods and
ovens, emissions could be reduced by 22,100 tons per year.
This is based on a 90 percent capture of emissions by a carbon
adsorber or destruction in an incinerator, an overall reduction
in emissions of 81 percent.
5-22
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5.5 DIRECT ECONOMIC IMPACTS
This section presents the direct economic implications of
implementing the RACT guidelines for surface coating of paper
on a statewide basis. The analysis includes the availability
of equipment and capital; feasibility of the control technology;
and impact on economic indicators, such as value of shipments,
ujiit price (assuming full cost pass-through) , state economic
variables and capital investment.
5.5.1 RACT Timing
Current proposed guidelines for paper coating suggest
three sets of compliance deadlines for alternative methods of
compliance.-1- Generally, for add-on systems they call for
installation of equipment and demonstration by mid-1980 or
late 1980; for low solvent systems, by late 1980 or mid-1981,
depending upon the degree of research and development needed.
Major coaters, material suppliers and equipment manufacturers
believe these deadlines to be unattainable.
Normally, large incinerator and carbon adsorption
systems will require about a year or more from
receipt of purchase to install and start up the
system. Engineering may require three months
or more, fabrication three to six months and
installation and startup as long as three
months. A major coater with considerable
experience with similar installations estimates
that the complete cycle of installation, from
initial selection of control method to testing
of the system, would require 37 months plus an
additional 12 months to establish an economically
sound method of control.
Only a1 small number of companies manufacture
incineration systems with proven high heat recovery.
The cumulative effect of equipment requirements by
all firms in the U.S. needing control devices could
severely impede the ability of these firms to supply
equipment. . In some cases, the most efficient devices
are only now undergoing initial trials, and no pro-
duction capacity has been developed.
Regulatory Guidance for Control of Volatile Organic Compound
Emissions from 15 Source Categories, EPA-905/2-78-001
5-23
-------
A major coating firm estimates that the use of
low solvent or solventless coatings may take
as long as 68 months from initial research,
through product evaluation and customer acceptance
to final production. Product and process development
alone may take as long as 24 months and product
evaluation over 14 months. These comments are in
general agreement with those made by other coaters.
In general, it appears that if either add-on control
systems are used or new low solvent systems need to be developed,
deadlines must be extended.
5.5.2 Technical Feasibility Issues
Though low solvent or solventless materials are used in
many paper coating operations at present, many types of solvent-
based systems have no satisfactory replacement. The alternative
materials do not meet the product quality standards demanded
by the coaters. Additional development is needed and will require
the combined efforts of both the coaters (who must maintain
product quality) and the coating material suppliers. Ideally,
the new coating materials should be adaptable to existing coat-
ing equipment to minimize additional capital investment.
As discussed above, both incineration and carbon adsorption
are not completely satisfactory add-on control systems.
Incineration requires large volumes of additional fuel if good
heat recovery is not accomplished; carbon adsorption is not
usable on many coating systems because of the multiplicity
of compounds used in solvent mixtures.
5.5.3 Comparison of Direct Cost with Selected Direct
Economic Indicators
The net increase in annual operating costs to coaters was
estimated at $6.7 million to $9.6 million. These additional
costs are projected to represent 1.1 percent to 1.6 percent of
the total annual value of shipments (about $600 million) of the
firms identified to be affected by the proposed regulations.
Assuming a "direct pass-through" of these costs, prices will
increase by about the same fraction.
The major economic impact in terms of cost to most indivi-
dual companies will be the large capital expenditures required
for add-on devices, rather than increased annual operating costs.
For most companies, these costs would exceed their current•level
of capital expenditures for plant improvement and expansion. A
large pressure-sensitive paper coater, for instance, has estimated
that a capital investment of about $2 million would be needed
to meet proposed guidelines. His current capital expenditure
program is normally in the range of $1.5 million.
5-24
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A typical case is a Michigan firm which manufacturers
various types of recording paper and produces 40 percent of the
electrocardiogram paper used in this country. Although with
additional development some of its coating solutions could
be replaced with low solvent or waterborne ones, incineration
or carbon adsorption would be the only method of complying with
the regulation as now proposed. Based on projected costs for
either of these add-on control systems, the firm is seriously
considering terminating or moving operations. Similar financial
difficulties are foreseen for marginally profitable firms which
have limited capital access or for which the added annual costs
of compliance are prohibitive.
Similar comments have been obtained from other coaters,
particularly small ones, who believe that the capital cost of
add-on controls will present a major capital acquisition problem.
5.5.4 Selected Secondary Economic Impacts
This section discusses the secondary impact of implementing
RACT on employment, market structure and productivity.
Employment is expected to be only moderately affected.
Employment would be reduced if marginally profitable facilities
closed, but the present indication from the industry is that
plant closures may occur only for small firms with limited
capital access. However, even large firms may be forced to
close down marginally profitable coating lines with a
resultant decrease in employment.
It is likely that market stucture may be affected by the
closure of firms with limited capital access, with their sales
being absorbed by larger firms. The number of closures, however,
is expected to be small if capital resources can be made
available to the companies, since operating costs have only a
small effect on sales price and would be the same for all firms
affected.
No significant affect on overall productivity is foreseen
except for a small change resulting from the need for add-on
control system operating and maintenance personnel.
Exhibit 5-13, on the following page, summarizes the
conclusions reached in this study and the implications of
the estimated costs of compliance for paper coaters.
5-25
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EXHIBIT 5-13
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR PAPER COATERS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected facilities
Indication of relative importance of the
industry to the state economy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC control
to meet RACT guidelines
Assumed method of control to meet RACT
guidelines
Discussion
Approximately 25 plants have been identified
from the emission inventory. However, if
this category is interpreted to include all
types of paper coating, including publishing,
far more firms would be affected.
The 1977 value of shipments of the 25 plants
identified is estimated to be approximately
$600 million. These plants employment is
estimated to be approximately 9,500
Gravure coating replacing older systems
Approximately 27,300 tons per year were identified
from the emission inventory. Actual emissions
are expected to be higher.
Though low solvent coating use is increasing,
progress is slow. Add-on control systems will
probably be used.
Thermal incineration with primary and secondary
heat recovery
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem areas
Discussion
Estimated to be $27 million to $36 million
depending on retrofit situations. This is
likely to be more than 100 percent of normal
expenditures for the affected paper coaters.
$6.7 million to $9.6 million annually. This
represents approximately 1.1 to 1.6 percent
of the 1977 annual sales for the affected paper
coaters on an industrywide basis.
Assuming a "direct cost pass-through"—1.1 to 1.6
percent on an industrywide basis
Assuming 35 percent heat recovery annual energy
requirements are expected to increase by approxi-
mately 115,000 equivalent barrels of oil annually.
No major impact
No major impact
Smaller firms may be unable to secure capital
funding for add-on systems, which are typically
$250,000 or more for a moderate-sized incinerator
to over $1 million for a carbon adsorber.
RACT guideline needs clear definition for
rule making.
Equipment deliverables and installation of in-
cineration systems prior to 1982 are expected to
present problems
Retrofit situations and installation costs are
highly variable
Type and cost of control depend on particular
solvent systems used and reduction in air flow
-------
Source; Booz, Allen t Hamilton Inc.
EXHIBIT 5-13(2)
U.S. Environmental Protection Agency
Affected Areas in Meeting RACT
VOC emissions after control
Discussion
5,200 tons/year (20 percent of 1977 VOC emission
level)
Cost effectiveness of control
$300 - $fl30 annualized cost/annual ton of VOC
reduction
-------
BIBLIOGRAPHY
Davidson's Textile Blue Book/ 1977.
T. W., Hughes, et al., Source Assessment; Prioritization
of Air Pollution from Industrial Surface Coating Operations,
Monsanto Research Corporation, Dayton, Ohio. Prepared for
U.S. Environmental Protection Agency, Research Triangle Park,
N.C., under Contract No. 68-02-1320 (Tech. 14) Publication
No. 650/2-75-019a.
T. A. Kittleman and A. B. Akell, "The Cost of Controlling
Organic Emissions," Chemical Engineering Progress, April 1978.
Lockwoods Directory of the Paper Industry, 1977.
Springborn Laboratories, Air Pollution Control Engineering and
Cost Study of General Surface Coating Industry, Second Interim
Report. EPA Contract No. 68-0202075, August 23, 1977.
State Industrial Directories Corporation, 1978-79 Illinois
State Industrial Directory, 1978.
Thomas Register of American Manufacturers, 1978.
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Existing Stationary Sources, Volume I.
EPA-450/2-76-028, May 1977.
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Existing Stationary Sources, Volume II.
EPA-450/2-77-008, May 1977.
U.S. Environmental Protection Agency, Regulatory Guidance for
Control of Volatile Organic Compounds Emissions from 15 Categories
of Stationary Sources, EPA-905/2-78-001, April 1978.
U.S. Department of Commerce, Annual Survey of Manufactures, 1976.
U.S. Department of Commerce, County Business Patterns, 1976.
U.S. Department of Commerce, Census of Manufactures, 1972.
-------
Private conversations with:
Armak Co.
American Can Co.
Fasson
Presto Adhesive Paper Co.
3M Company
Morgan Adhesives
National Flexible Packaging Assn.
Pressure Sensitive Tape Council
Continental Can Co.
General Electric Co.
Mead Corp.
St. Regis Paper Co.
World Wild Games
TEC Systems
Overly Inc.
Bobst-Champlain
REECO, Inc.
Arvey Corp.
Bagcraft Corp. of America
Chicago Decal Co.
Diamond T. Packaging Corp.
Engineered Coated Products, Inc.
Joanna Western Mills
Ludlow Corp.
Meyercord
Nabisco
Nashua
Standard Packaging
Weber Marking Systems
Weber Valentine Co.
Weldon Industries
Marysville, Ml/Alliance, OH
Greenwich, CT
Painesville, OH
Miamisburg, OH
St. Paul, MN
Milan, OH
Cleveland, OH
Chicago, IL
Newark, OH
Coshocton, OH
Chillicothe, OH
Battle Creek, Ml/Troy, OH
Radnor, OH
DePere, WI
Neenah, WI
Roseland, NJ
Morris Plains, NJ
Chicago, IL
Chicago, IL
Chicago, IL
Addison, IL
Northbrook, IL
Chicago, IL
Chicago, IL
Carol Stream, IL
Marseilles, IL
Chicago, IL
Elgin, IL
Arlington Hts., IL
Elk Grove, IL
Harvey, IL
-------
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6.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
FABRICS IN THE STATE OF ILLINOIS
-------
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6.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
FABRICS IN THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact of
implementing RACT for plants in the State of Illinois which are
engaged in the surface coating of fabrics and vinyls. This RACT
category is meant to include the roll, knife or rotogravure
coating and oven drying of textile fabrics (to impart strength,
stability, appearance or other properties), or of vinyl coated
fabrics or vinyl sheets. It includes printing on vinyl coated
fabrics or vinyl sheets to modify appearance but not printing
on textile fabrics for decorative or other purposes. It does
not, however, include the coating of fabric substrates with
vinyl plastic polymers which are usually applied as melts or
plastisols that result in only minor amounts of emissions. The
chapter is divided into six sections:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Alternative control methods
Cost and VOC reduction benefit evaluations
for the most likely RACT alternatives
Direct economic impacts.
Each section presents detailed data and findings based on
analyses of the RACT guidelines, previous studies of fabric
coating, interviews with fabric and vinyl coaters, coating
equipment and materials manufacturers, add-on control equipment
manufacturers, and a review of pertinent published literature.
6-1
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6.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impacts
for plants in the state engaged in the surface coating of fabrics
and vinyls. The quality of these estimates is discussed in the
last part of this section.
6.1.1 Industry Statistics
The coating of fabrics is used to produce a large variety
of common consumer and industrial products. Typical products
are raincoats, upholstery, wall covering, tablecloths, window
shades, gasketing, diaphragms, lifeboats and bookcovers. In
most cases the finished product is manufactured by firms which
purchase the coated fabric from a manufacturer whose principal
activity is fabric coating. However, there are a number of
vertically integrated firms (the major automobile manufacturers
are typical) which both coat fabrics and manufacture finished
goods from them. Other exceptions are firms which both manu-
facture fabrics and coat them. Thus firms which coat fabrics
or vinyl coated fabrics or sheeting can be found in a number
of Standard Industrial Classification categories; these are
listed below:
SIC Description
2211 Broad woven fabric mills, cotton
2221 Broad woven fabric mills, man-made and silk
2241 Narrow fabrics and other, small wares mills
2258 Warp knit fabric mills
2261 Finishers of broad woven fabrics of cotton
2262 Finishers of broad woven fabrics of man-made
fiber and silk
2269 Finishers of textiles, n.e.c.*
2295 Coated fabrics, not rubberized
2297 Nonwoven fabrics
3069 Fabricated rubber products, n.e.c.*
3079 Miscellaneous plastics products
3291 Abrasive products
3293 Gaskets, packing, sealing devices
*not elsewhere classified
6-2
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General statistics concerning the firms included in
these SIC groupings were obtained from the most recent
Census of Manufacturers, County Business Patterns and other
economic summaries published by the U.S. Department of
Commerce.
Data on industrywide shipments of coated fabrics were
obtained from the Textile Economics Bureau (New York City,
N.Y.). Identification of individual candidate firms which
might be affected by the proposed regulation was made by
review of industry directories:
Davidson's Textile Blue Book
Rubber Red Book
Modern Plastic Encyclopedia
Thomas Register of American Manufacturers
Illinois Directory of Manufacturers
Membership list of the Canvas Products Association.
A list of establishments expected to be affected by the
proposed fabric coating RACT regulations in the state was sent
to the Illinois EPA for comparison with its emission inventory.
Seven firms were located which have fabric coating operations.
These firms were interviewed by telephone by the study team to
verify their emissions and type of coating operations. Only two
firms were found which appear to be affected by the proposed
regulations:
Joanna Western Mills, Chicago
Western Acadia, Inc., Chicago.
The other firms either did not use roll-type coating or had
emissions sufficiently low not to be affected.
6.1.2 VOC Emissions
The Illinois Environmental Protection Agency emission
inventory was used as a basis for the estimation of the total
VOC emissions from the fabric coating plants identified.
They are believed to represent 90 percent or more of the
emissions in this RACT category. Emissions from fabric coating
plants not identified in the state, if they exist, are expected
to be small and negligible.
6-3
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6.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions from fabric
coating processes are described in Control of Volatile Organic
Emissions from Existing Stationary Sources, Volume II
(EPA-450/2-77-008). The report suggests the use of various
low solvent or solventless coatings which have found some
use in the industry, as well as add-on devices, such as
incinerators or carbon adsorbers. In some cases waterborne
of other low solvent coatings can be used.
6.1.4 Cost of Control and Estimated Reduction of VOC Emissions
The overall costs of control of VOC emissions were determined
by an independent estimate of control costs by the study team
based upon emissions obtained from the Illinois Environmental
Protection Agency inventory.
This estimate used design and cost information provided by
incinerator manufacturers or available in the published litera-
ture and in the following EPA reports:
Control of Volatile Organic Emissions from Existing
Stationary Sources, Volume I (EPA-450/2-76-028)
Air Pollution Control Engineering and Cost Study of
General Surface Coating Industry, Second Interim
Report, Springborn Laboratories.
Estimates of emission reduction are largely dependent upon
the efficiency with which solvents can be collected from the
coating operation. In formulation of the proposed regulation,
EPA has estimated that, by proper collection system design, at
least 90 percent of the solvents in the applied coating
material can be collected. This 90 percent is not meant to
include solvents which might be lost in the compounding of
the coating or used for cleaning of the process equipment
or fabric.
Incineration was selected as the control method for
estimating purposes at a reduction efficiency of 90 percent.
Though carbon adsorption or low solvent coatings might be
applicable in an individual case, final costs are not expected
to be significantly different than incineration.
6-4
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6.1.5 Economic Impacts
The economic impacts were determined by: analyzing the
lead time requirements to implement RACT; assessing the
feasibility of instituting RACT controls in terms of capital
availability and equipment availability; comparing the direct
costs of RACT control to various state economic indicators; and
assessing the secondary effects on market strii ture, employment
and productivity as a result of implementing RACT controls in
Illinois. Since two companies appear to be affected,
detailed statements concerning the impact of the regulations
upon certain individual economic factors are not possible.
Proprietary information, such as annual capital expenditures
and value of shipments, is not available.
6.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls on the surface coating of fabrics in Illinois. A
rating scheme is presented in this section to indicate the
quality of the data available for use in this study. A rating
of "A" indicates hard data (data that are available for the
base year), "B" indicates data that were extrapolated from
hard data and "C" indicates data that were not available in
secondary literature and were estimated based on interviews,
analysis of previous studies and best engineering judgment.
Exhibit 6-1, on the following page, rates each study output
listed and the overall quality of the data.
6-5
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EXHIBIT 6-1
U.S. Environmental Protection Agency
DATA QUALITY—SURFACE COATING OF FABRICS
B C
A Extrapolated Estimated
Study Outputs Hard Data Data Data
Industry statistics X
Emissions Xa
Cost of emissions control X
Economic impact X
Overall quality of data X
a. Emission data supplied by Illinois Environmental Protection
Agency, state emission inventory.
Source; Booz, Allen & Hamilton Inc.
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6.2 INDUSTRY STATISTICS
Industry characteristics, statistics, and trends for
fabric coating are presented in this section. This information
forms the basis for assessing the total impact of implementing
RACT for control of VOC emissions in this category upon the
state economy and upon the individual firms concerned. The
e,ffects upon the firms involved are somewhat different because
of their relative sizes; though proportionately the effects
are similar.
6.2.1 Size of the Industry
The Bureau of Census, in 1976 County Business Patterns,
reported a total of about 1,378 plants in SIC categories in
which plants coating fabrics in Illinois would be expected
to be tabulated.
Pertinent data concerning these plants are summarized
in Exhibit 6-2, on the following page. As mentioned earlier
based on a review of industrial directories and other published
information, two plants were found in which fabric coating,
as defined in the proposed "fabric coating" regulation, is
being used. Statistics concerning these two plants are
summarized in Exhibit 6-3, following Exhibit 6-2.
As shown, these two firms are estimated to employ a total
of 400 people in their coating production facilities.
6.2.2 Comparison of the Industry to the State Economy
A comparison of the value of shipments of these plants
with the state economy indicates that these plants represent
a small percentage of the total value of shipments by manu-
facturing plants and employ about 0.02 percent of manufacturing
workers in Illinois.
6.2.3 Historical and Future Patterns of the Industry
The fabric coating industry in the U.S., except for the
general economic slump in 1975, has shown a gradual but
steady growth in sales and shipments over the last several
years as demonstrated by Exhibits 6-4 and 6-5, following
Exhibit 6-3. The largest growth in terms of dollar value of
shipments was for vinyl coated fabrics which increased by
$215.5 million in shipments from 1972 to 1976, compared with
an increase of $301 million for all coated fabrics. Pyroxylin
(cellulose nitrate) coatings, because of their low cost and
ease of application, still continue to occupy a steady though
6-6
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EXHIBIT 6-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR PLANTS IN SIC CATEGORIES
WHERE FABRIC COATING MAY BE USED IN ILLINOIS
SIC Name
2211 Broad woven fabric mills, cotton
2221 Broad woven fabric mills, man-made and silk
2241 Narrow fabrics and other, small wares mills
2258 Warp knit fabric mills
2261 Finishers of broad woven
2262 Finishers of broad woven
made fiber and silk
2269 Finishers of textiles, n.e.c.
2295 Coated fabrics, not rubberized
2297 Nonwoven fabrics
3069 Fabricated rubber products, n.e.c.
3079 Miscellaneous plastics products
3291 Abrasive products
3293 Gaskets, packing, sealing devices
fabrics of cotton
fabrics of man-
Number of
Firms
b
4
b
b
6
b
Number of
Employees
91
174
350
750
3,500
31,296
2,161
6,677
44,999
Annual
Payroll
($OOOs)
862
2,535
a
a
338,867
26,610
84,648
453,522
a. Not reported to protect proprietary information.
b. None listed
Source; 1976 County Business Patterns, U.S. Department of Commerce,
-------
EXHIBIT 6-3
U.S. Environmental Protection Agency
FIRMS EXPECTED TO BE AFFECTED BY THE
FABRIC COATING RACT REGULATIONS IN ILLINOIS
Firm
Location
Employees
Activity
Joanna Western Mills
Western
Chicago
Chicago
1,000
600
Vinyl coating
Various coated fabrics
Source: Booz, Allen and Hamilton Inc.
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EXHIBIT 6-4
U.S. Environmental Protection Agency
U.S. ANNUAL VALUE OF SHIPMENTS OF COATED FABRICS
($ millions)
Item
1972
1973
1974
1975
1976
Pyroxylin-Coated Fabrics
Vinyl Coated Fabrics
Other Coated Fabrics
Coated Fabrics, not rubberized
Rubber Coated Fabrics
TOTAL
26.3
601.9
154,
26,
1
3
67.9
27.3
693.7
188.0
29.4
73.61
34.5
728.7
212.6
(13.6)a
83.5b
876.5 1,011.9 1,156.5
28.0
681.5
202.7
(1.4)
72.Ob
32.5
817.4
213.8
(33.8)
80.0
b
985.6 1,177.5
a. Values obtained by difference from gross shipments of all coated fabrics, not rubberized
b. Booz, Allen estimate based on shipments of "Other Rubber Goods, N.E.C.", SIC Code 30698
Source: 1976 Annual Survey of Manufactures
-------
EXHIBIT 6-5
U.S. Environmental Protection Agency
U.S. ANNUAL SHIPMENTS OF BACKING MATERIALS FOR
COATED FABRICS
(in millions of pounds)
Transportation Fabric, all fibers'
1972
95.4
1973
100.9
1974
64.6
1975
65.3
1976
81.5
Coated and Protective Fabrics
133.7
149.3
167.5
137.8
177.6
TOTAL
229.1
250.2
232.2
203,1
259.1
a.
Transportation fabric includes auto seat upholstery and slipcovers, sidewall, headlining
and sheeting. The cotton poundage include the knit and woven fabric used as the backing
for vinyl sheeting. The item includes convertible auto tops & replacements thereof, as
well as upholstery used in other kinds of transportation, such as airplanes, railroad &
subway cars, buses, etc. It does not include seat padding, transportation rugs window
channeling flocking, tassels, trim, etc., or the textile glass fiber used in reinforced
plastic seating for subways, buses, etc.
Coated and protective fabrics includes parachutes, deceleration chutes and tow targets;
awnings; beach, garden & tractor umbrellas; inflatable dunnage and cushions, air-supported
structures and automotive air-spring diaphragms; boat and pool covers; tarpaulin covers
for athletic fields, etc.; also, the substrates used for vinyl sheeting. The cotton
poundage include awnings, boat covers, tarpaulins and tents. Not included here are the
cotton poundages used for vinyl substrates. Such poundages are tabulated with their
appropriate end use, i.e., transportation upholstery, upholstery, etc. Does not include
man-made fiber surfaces for recreational fields.
Source: Textile Economics Bureau, Technicpn, November 1977
-------
proportionately smaller share of the market. Natural and
artifical rubber coated fabrics, because of unique properties
not obtainable with plastic materials, also maintain a sub-
stantial (about 10 percent) share of the coated fabric market.
Vinyl and urethane coatings, however, are replacing a larger
share of both markets.
6-7
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6.3 TECHNICAL SITUATION IN THE INDUSTRY
This section describes the principal materials and
processes used in fabric and vinyl coating and various
methods which are considered to be reasonably available
control technology to meet the proposed regulations. The
proposed RACT guidelines for fabric coating and an estimate
of the total VOC emission reduction possible if the guide-
lines are implemented in the state are also presented.
6.3.1 General Coating Process Description
Fabrics are coated primarily to render them resistant
to penetration by various fluids or gases, improve abrasion
resistance or modify the appearance or texture. Typical
examples are materials used in shower curtains; rubber life
rafts; ballons; drapery material; synthetic leathers for
shoes, upholstery or luggage; table cloths; and outdoor
clothing. The base fabrics can be asbestos fiber cloth,
burlap and pite, cotton drill, duck canvas, glass fabrics,
knit cotton or rayon, nonwoven fabrics or nylon sheeting.
In the case of coating of vinyls, the substrate is a flexible
vinyl sheet or cloth-supported vinyl on which a coating is
applied to enhance the appearance or durability of the vinyl
surface.
Typical coating materials are rubber compounds, vinyl
resins of various types, polyesters, polyurethanes, nitro-
cellulose resins, oleo resins, phenolic resins, epoxy resins
and polyethylene. Various techniques are used for applying
these coatings as melts, plastisols, latexes, solutions
or other forms. Since these proposed guidelines are primarily
concerned with coatings applied as solutions, where large
volumes of volatile organic materials can be emitted, the
following discussions will be limited primarily to processes
for coating with coating materials dissolved in organic
solvents.
Exhibit 6-6, on the following page, shows the general
operations involved in most fabric or vinyl coating operations,
Four basic operations are involved:
Milling — Milling is primarily restricted to
coatings containing rubber. Natural and synthetic
rubbers are usually milled with pigments, curing
agents and fillers to produce a homogeneous mass
that can be dissolved in a suitable solvent.
Organic solvents are not usually involved in the
milling process; thus, there are seldom any organic
emissions from this operation.
6-8
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EXHIBIT 6-6
U.S. Environmental Protection Agency
TYPICAL FABRIC COATING OPERATION
PIGMENTS
CURING AGENTS
SOLVENT
1
MILLING
MIXING
DRYING AND
CURING
COATING
AmiCATtON
FAIRIC
-> COATED PRODUCT
Source; Control of Volatile Organic Emissions from Existing Stationary Sources,
Volume II (EPA-450/2-76-028)
-------
Mixing — Mixing is the dissolution of solids
from the milling process in a solvent. The
formulation is usually mixed at ambient
temperatures. Sometimes only small fugitive
emissions occur. However, some vinyl coaters
estimate that as much as 25 percent of plant
solvents are lost in mixing operations.
Coating Application — Fabric is usually coated
by either a knife or a roller coater. Both
methods are basically spreading techniques
used for high speed application of coatings
to flat surfaces. In some unique situations,
dip coating may be used.
Drying and Curing — Finally, the coating is
dried or cured in a final operation using
heat or radiation to remove the solvents
or set the coating.
In general, the coating line is the largest source of
solvent emissions in a fabric coating plant, and the most
readily controllable. Some coating plants report that over
70 percent of solvents used within the plant are emitted
from the coating line. Other plants, especially those
involved in vinyl coating, report that only 40 to 60
percent of solvents purchased by the plant are emitted
from the coating line. Remaining solvents are lost as
fugitive emissions from other stages of processing and in
cleanup. These fugitive losses are generated by:
Transfer from rail cars or tank trucks to
storage tanks, and subsequent transfer to
processing tanks
Breathing losses from vents on storage
tanks
Agitation of mixing tanks which are vented
to the atmosphere
Solvent evaporation from cleanup of the
coating applicator when coating color or
type is changed
Handling, storage and disposal of solvent
soaked cleaning rags
Waste ink disposal — Waste ink is usually
distilled to recover much of solvent. After
distillation the sludge, which still contains
some solvent, is usually dumped in a land-
fill
6-9
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Losses from drums used to store coatings
which are being pumped onto a coating appli-
cator. These are usually drums which are
not hooded and may not even be covered
Cleaning empty coating drums with solvent
Cleaning coating lines with solvent
Evaporation of solvent from the coated fabric
after it leaves the coating line. From 2-3
percent of total plant solvent usage
remains in the product. Half of this may
eventually evaporate into the air.
Control techniques for the above types of sources
include tightly fitting covers for open tanks, collection
hoods for areas where solvent is used for cleanup and
closed containers for solvent wiping cloths.
6.3.2 Nature of Coating Materials Used
Coating formulations used in organic-solvent-borne
coatings normally incorporate film-forming materials/
plasticizers, pigments and solvents. A multitude of
organic solvents are used; solvents such as acetone toluene,
heptane, xylene, methyl ethylketone, isobutyl alcohol and
tetrahydrofuran are widely used in rubber, vinyl and ure-
thane coating formulations.
In some cases, a single solvent is used, but more
generally mixed solvents are employed to obtain optimum
drying rates and coating mixture properties. Too rapid
drying results in undesirable surface properties such
as "orange peel" or other effects; improper viscosity or
solvency of the coating mixture may prevent proper coating
of the substrate; slow drying can limit production rates.
As discussed earlier, a number of film-forming
materials are used. Typical coating materials are epoxy
resins, melamine-formaldehyde resins, nitrocellulose resins,
oleoresinous compounds, phenolic resins, polyesters, poly-
urethanes, rubber compounds and vinyl resins. Miscellaneous
resins such as polyethylene and ethylene copolymers, starch
and casein compounds, and acrylic resins are not discussed here
since most use coating techniques which are not solvent related.
6-10
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Plasticizers are added where the flexibility of the
coating is important, such as in clothing or upholstery
fabric. Pigments or opacifiers are added to clear film
formers to provide the colors or other appearance effects
desired or are used in inks as a separate coating operation
to modify the surface of the coating. Pigments applied
as a printed coating are normally further coated with a
clear finish coat to provide the luster desired and provide
protection from wear.
6.3.3 Coating Processes Commonly Used
Exhibits 6-7 and 6-8, on the following pages, illustrate
the two major methods of applying solvent-based coatings—
knife coating and roll coating.
Knife coating is probably the least expensive
method. The substrate is held flat by a roller
and drawn beneath a knife that spreads the
viscous coating evenly over the full width
of the fabric. Knife coating may not be
appropriate for coating materials such as
certain unstable knitgoods, or where a
high degree of accuracy in the coating
thickness is required.
Roller coating is done by applying the
coating material to the moving fabric, in
a direction opposite to the movement of the
substrate, by hard rubber or steel rolls.
The depth of the coating is determined by
the gap between rolls (A and B as shown
in Exhibit 6-7). The coating that is trans-
ferred from A to B is then transferred to
the substrate from roll B. Unlike knife
coaters, roller coaters apply a coating
of constant thickness without regard to
fabric irregularities.
Rotogravure printing is widely used in vinyl coating
of fabrics and is a large source of solvent emissions. Roto-
gravure printing uses a roll coating technique in which the
pattern to be printed is etched as a series of thousands
of tiny recessed dots on the coating roll. Ink from a
reservoir is picked up in these recessed dots and is trans-
ferred to the fabric surface. Shadow prints are used to
simulate leather grain. A variety of patterns are printed
on such items as vinyl wall paper. A transparent protective
topcoat over the printed pattern is also applied with roto-
gravure techniques.
6-11
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EXHIBIT 6-7
U.S. Environmental Protection Agency
KNIFE COATING OF FABRIC
COATING
KNIFE
COATED FABRIC TO DRYER
EXPANDED COATED FABRIC
COATING
SUBSTRATE
SUBSTRATE
HARD RUBBER OR STEEL ROU ER
Source; Control of Volatile Organic Emissions from Existing Stationary Sources,
Volume II (EPA-450/2-76-028)
-------
EXHIBIT 6-8
U.S. Environmental Protection Agency
ROLLER COATING OF FABRIC
COATED FABRIC
JHM
SUISTRAU
Source; Control of Volatile Organic Emissions from Existing Stationary Sources,
Volume II (EPA-450/2-76-028)
-------
Solvent emissions from the coating applicator account
for 25 to 35 percent of all solvent emitted from a coating
line. This solvent may be collected by totally enclosing
the coating applicator in a small room or booth and sending
all booth exhaust to a control device. However, a total
enclosure of the coater may be difficult to retrofit on
many existing lines. Another alternative is to cover the
coater with a hood which can collect most of the solvent
emissions.
The final operation in the coating process is the
drying and curing of the applied coating material. Sixty-
five to 75 percent of solvent emissions from the coating
line usually occur in this step. In most ovens, almost
all solvent emissions are captured and vented with exhaust
gases. On some coating lines the emissions from the coating
applicator hood are ducted to the oven and included with the
oven exhaust.
Estimated and reported solvent concentration levels
from drying operations range between 5 and 40 percent of
the LEL (lower explosion limit). Typically, drying ovens
are designed to process fabric on a continuous basis, opera-
ting with a web or conveyor feed system. Ovens can be
enclosed or semienclosed and, depending on size, may
exhaust from a few thousand to tens of thousand of cubic
feet per minute of air. If an add-on control device is
to be installed, it is generally in the owner's best
interest to minimize the volume of air since the cost of
add-on control devices is largely determined by the
amount of air treated.
The oven heat increases the evaporation rate of the
solvent and, with some coatings, will produce chemical
changes within the coating solids to give desired proper-
ties to the product. In many cases, evaporation rates are
controlled to give the desired properties to the coated
fabric.
Many drying ovens in older plants are only semienclosed.
As a consequence/ they draw in excessive dilution air. Sol-
vent concentrations range between 5 and 12 percent of the LEL
according to both calculations and reports by industry. How-
ever, levels of up to 50 percent of the LEL are possible if
proper safety devices are used. At least three plants in the
United States are operated at 40 to 50 percent of LEL.
6-12
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6.3.4 Emissions and Current Controls
As discussed earlier, only two fabric or vinyl coaters
have been identified in Illinois. The total VOC emissions
from coating lines is estimated to be 600 tons for these
plants with the majority of this originating at the Joanna
Western Mills vinyl coating plant in Chicago.^
No controls are now used by these plants except for
.replacement of some coatings with waterborne ones.
6.3.5 RACT Guidelines
The RACT guidelines for control of VOC emissions from
fabric coating require that emissions from coating lines
be limited to a level of 2.9 pounds per gallon of coating
for coating of fabric substrates and 3.8 pounds per gallon
for coating of vinyl substrates. Both limits are based
upon the use of an add-on device which recovers or destroys
81 percent of the VOC introduced in the coating. This the
U.S. EPA considers to be achievable by capture of 90 percent
of the VOC emissions and destruction of these emissions in
an add-on device such as an incinerator. In some cases,
alternative low solvent or solventless coatings can also be
used to meet these limits.
1. The Illinois state inventory indicates total emissions of
about 1,300 tons per year for this plant. However, plant
personnel have reestimated emissions to be about 600 tons
per year.
6-13
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6.4 ALTERNATIVE CONTROL METHODS
In this section are briefly discussed methods of low
solvent and solventless systems, which have been demon-
strated to be applicable to some fabric coating products,
and the two principal add-on systems, incineration and
carbon adsorption, generally used for emission control.
This information has been extracted principally from the
previously cited EPA report, Control of Volatile Organic
Emissions from Existing Stationary Sources, Volumes I and II,
which should be consulted for a more thorough discussion.
In some instances, additional comment was obtained from coaters,
coating material suppliers and control equipment manufacturers.
6.4.1 Low Solvent and Solventless Coatings
Organic emissions can be reduced 80 to 100 percent
through use of coatings which inherently have low levels of
organic solvents. Both high-solids and waterborne coatings
are used. The actual reduction achievable depends on the
organic solvent contents of the original coating and the new
one. Using a coating which has a low organic solvent con-
tent may preclude the need for an emission control device.
Often the coating equipment and procedures need not be
changed when a plant converts to coatings low in organic
solvent.
Although a number of companies have converted to low
solvent coating, either in part or in total, one may not
presume them to be universally applicable. Each coating
line is somewhat unique and many coated fabrics have dif-
ferent specifications.
None of the plants identified were aware of suitable
alternative coatings currently available which would meet
the quality and performance standards required in all of
their products. Both firms have, over the last several
years, converted to waterborne coatings on some products and
believe that, if sufficient time were allowed for research
and development, a majority of their coatings could be
replaced by low solvent ones. There may be some coatings
which could not be replaced.
6-14
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6.4.2 Incineration
Catalytic and direct thermal incineration processes
convert hydrocarbons to carbon dioxide and water at high
temperatures. Incineration is widely accepted as a reliable
means of reducing hydrocarbon emissions by 90 percent or
more.
Generally, the major disadvantage of this approach is
the increased energy required to raise the exhaust gas
temperatures over 1,200°F for direct incineration and 700°F
for catalytic incineration. Natural gas is the most commonly
used fuel though propane, fuel oils, or other fluid hydro-
carbons can be employed. Fuel oil is not generally acceptable
because of the sulfur oxides generated in combustion or the
presence of catalyst poisons in the oil. Another problem is
the generation of nitrogen oxides in direct fired incinerators
resulting from the exposure of air to high-temperature flames.
The increased energy consumption can, in some cases, be
reduced or eliminated by heat exchange of the exhaust gases
with fresh emissions (primary heat recovery) or by use of
the hot exhaust gases in process applications (secondary
heat recovery). Typical use of secondary heat recovery is
for oven heat in drying or curing ovens. In fact, with
efficient primary exchange and secondary heat recovery,
total fuel consumption of an incinerator-oven system can be
less than that for the oven before the incinerator is added.
The heat required to sustain the system comes from com-
bustion of volatile organic compounds in the exhausts.
Both catalytic and direct fired systems are capable of
high heat recovery efficiency if several conditions occur:
VOC concentrations are or can be increased to 8-10
percent or more of their LEL (lower explosion
limit) .
Oven temperatures are sufficiently high to enable
use of the sensible heat in the exhaust gases
after primary heat exchange. Usually, oven
temperatures above 140°F are sufficient to allow
85 percent or more overall heat recovery.
Where catalytic incinerators are used, no com-
pounds must be present in the gases treated which
could poison or blind the catalyst.
6-15
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In most coating operations, drying and curing tem-
peratures are 250°F or higher. By reduction of air flow to
reach exhaust levels of 8-10 percent or higher and proper
design of the heat recovery system, it may be possible to
achieve overall heat recoveries of 85 percent or greater.
For purposes of cost estimation it was assumed that such
heat recovery efficiency could be reached.
6.4.3 Carbon Adsorption
Carbon adsorption has been used since the 1930s for
collecting solvents emitted from paper coating operations.
Most operational systems on coating lines were installed
because they were profitable. Pollution control has usually
been a minor concern. Carbon adsorption systems on coating
lines range in size from a few thousand to tens of thousands
of cubic feet per minute. Exhausts from several coating
lines are often manifolded together to permit one carbon
adsorption unit to serve several coating lines.
The greatest obstacle to the economical use of carbon
adsorption is that, in some cases, reusing solvent may be
difficult. In many coating formulations, a mixture of
several solvents is needed to attain the desired solvency
and evaporation rates. If this solvent mixture is recovered,
it sometimes cannot be reused in formulating new batches of
coatings. Also if different coating lines within the plant
use different solvents and are all ducted to one carbon
adsorption system, then there may be difficulty reusing the
collected solvent mixture. In this case, solvents must be
separated by distillation.
However, in some cases azeotropic, constant boiling,
mixtures can occur which can be separated only by spe-
cialized techniques. Most coating firms would not have the
skills necessary for the complex distillation and separation
procedures needed. For small adsorption systems, the ad-
ditional separation expenses would probably exceed the cost
of fresh solvent.
Also, adsorption of solvents containing water soluble
compounds (such as alcohols, ketones or esters) can present
a secondary pollution problem where steam is used for bed
regeneration. Additional treatment of the condensed steam
with its content of dissolved organics would be required,
increasing the complexity of the solvent recovery system and
its cost.
6-16
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6.5 COST AND VOC REDUCTION BENEFIT EVALUATIONS
FOR THE MOST LIKELY RACT ALTERNATIVES
This section discusses the projected costs of control
for fabric coating in the state. Where possible, the validity
of the costs were confirmed with coating firms and equipment
manufacturers.
As discussed earlier in this report, only two major
coaters were identified. The major impact of the regula-
tion will be upon the Joanna Western Mills plant.
6.5.1 Costs of Alternative Control Systems
Exhibits 6-9 and 6-10, following the next page, summarize
costs for typical incineration systems as developed by EPA
sources. These are based on the assumption that exhaust flow
rates can be reduced sufficiently to obtain LEL levels of 25
percent. This is possible with well-designed capture systems
where intake air flows can be reduced.
The major problem in estimating individual installed
costs of control systems is the added cost of installation.
The EPA estimates were made on the assumption of an easily
retrofitted system. In practice, coaters have found actual
installed costs to be three to five times those summarized
in Exhibit 6-9 and 6-10. For instance, E.I. DuPont de Nemours,
based on their experience on actual installed equipment,
estimates^ $1.2 million for a carbon adsorber to treat
15,000 scfm of exhaust gases. Recent prices from recuper-
ative type incinerator manufacturers for a 15,000 scfm
direct fired, ceramic bed primary recuperative heat exchanger
are about $150,000 for the incinerator alone. Installed
costs, with provision for return of exhausts for secondary
heat recovery, are estimated at more than $300,000. The
estimates in Exhibits 6-9 and 6-10 indicated costs of $320,000
for an equivalent adsorber, and $140,000 for the incinerator.
T.A. Kittleman and A.B. Akell, "The Cost of Controlling Organic
Emissions," Chemical Engineering Progress, April 1978.
6-17
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6.5.2 Estimated Compliance Costs
As discussed on the previous page, emissions considered
to be applicable under RACT for fabric coating are about 600
tons per year. About four tons per year are emitted by the
Western Acadia operation. This company has estimated that
its emissions can be reduced to meet RACT regulations for a
capital cost of $7,000-$10,000 by use of a wet scrubber.
Qperating costs are expected to be negligible because of
recovery and reuse of solvents.
Personnel contacted at the Joanna Western Mills plant
have indicated that their long-range plan for compliance
would be directed to substitution of waterborne coating
materials for those presently used. However, product develop-
ment and evaluation would require several years and would
extend beyond proposed RACT compliance schedules. They have
not estimated costs for add-on systems. The study team,
using EPA cost data as presented in Exhibits 6-9 and 6-10,
on the following pages (but with capital costs multiplied
by three and four to account for retrofit difficulty and
inflation), has estimated a compliance cost for Joanna Western
at $2.4 million to $3.1 million for capital and $0.6 million to
$0.85 million in annual operating costs using a direct fired
incinerator with primary heat recovery only. This assumes that
seven direct fired incinerators with primary heat recovery
would be used and that air flow can be reduced sufficiently
to allow oven operation at 25 LEL. Other assumptions used
in this estimate are summarized in Exhibit 6-11, following
Exhibit 6-10.
As mentioned above, the EPA capital costs obtained by
using Exhibit 6-9 were multiplied by three and four to account
for difficult retrofit of add-on incinerators. Normally
problems involving temporary removal or shutdown of equipment,
roof mounting, addition of new fuel systems or enclosing of
coating lines and ovens are encountered when incinerators or
other add-on control devices are installed on in-place
coating lines. Annual operating costs were adjusted to take
care of these additional capital costs.
The estimate of annualized cost is very sensitive to
the estimated capital costs and the degree of heat recovery
which can be achieved. Normally, capital charges for depre-
ciation, taxes, administrative costs, maintenance and interest
would be about 25 percent .of capital; in this case, minimum
capital charges would be about $0.6 million to $0.78 million.
However, this and other operating costs could be offset by
fuel savings from the combustion of the VOC emissions, if
secondary heat recovery were possible. The savings, however,
would probably be less than 10 percent.
6-18
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80
EXHIBIT 6-9
U.S. Environmental Protection Agency
CAPITAL COST FOR DIRECT FLAME AND CATALYTIC
INCINERATORS WITH PRIMARY HEAT EXCHANGE
10
IS 20 25 30
PROCESS FLOW. 103ufm (APPROXIMATE)
35
40 45
Source; Control of Volatile Organic Emissions from Stationary Sources, Volume I
(EPA-450/2-76-028)
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EXHIBIT 6-10
U.S. Environmental Protection Agency
ANNUAL COST OF DIRECT FLAME INCINERATORS
WITH PRIMARY HEAT RECOVERY AT 300° F
ANNUAL COST, $*103
§
Source: Control of Volatile Organic Emissions from Stationary Sources, Volume I
(EPA-450/2-76-028)
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EXHIBIT 6-11
U.S. Environmental Protection Agency
SUMMARY OF ASSUMPTIONS USED IN COST ESTIMATE
Assumptions
For 600 tons per year of current emissions, 90 percent of emissions are controlled
by incineration with primary heat recovery; 90 percent of solvent emissions from
the coating line are collected. Total reduction is 81 percent. An additional 4 tons
per year are controlled by a water scrubber.
25 percent LEL is equal to 3,000 ppm of methylethyl ketone by volume for purposes of
incineration cost estimation.
Air flow can be reduced to reach 25 percent LEL.
Emission rate is constant over a period of 2,000 hours per year.
Other assumptions regarding incinerator prices and operating parameters, as estimated
in Control of Volatile Organic Emissions from Existing Stationary Sources, Vol. Ij
Control Methods for Surface-Coating Operations, EPA-450/2-76-028, are valid.
Source: Booz, Allen & Hamilton Inc.
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6.6 DIRECT ECONOMIC IMPACTS
This section presents the direct economic implications of
implementing the RACT guidelines for surface coating of fabrics
on a statewide basis. The analysis includes the availability
of equipment and capital; feasibility of the control technology;
and impact on economic indicators, such as value of shipments,
unit price (assuming full cost pass-through), state economic
variables and capital investment.
6.6.1 RACT Timing
Current proposed guidelines for fabric coating suggest
three sets of compliance deadlines for alternative methods of
compliance.1 Generally, for add-on systems they call for
installation of equipment and demonstration by mid-1980 or
late 1980; for low solvent systems, by late 1980 or mid-1981,
depending upon the degree of research and development needed.
Major coaters, material suppliers and equipment manufacturers
believe these deadlines to be unattainable.
Normally, large incinerator and carbon adsorp-
tion systems will require about a year or more
from receipt of purchase to install and start
up the system. Engineering may require three
months or more, fabrication three to six months
and installation and startup as long as three
months. A major paper coater with considerable
experience with similar installations estimates
that the complete cycle of installation, from
initial selection of control method to testing
of the system, would required 37 months plus an
initial 12 months to establish an economically
sound method of control.
Only a small number of companies manufacture
incineration systems with proven high heat
recovery. The cumulative effect of equipment
requirements by all firms in the U.S. needing
control devices could severely impede the
ability of these firms to supply equipment.
In some cases, the most efficient devices
are only now undergoing initial trials, and
no production capacity has been developed.
Regulatory Guidance for Control of Volatile Organic Compound
Emissions from 15 Source Categories, EPA-905/2-78-001.
6-19
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A major coating firm estimates that the use of
low solvent or solventless coatings may
take as long as 68 months from initial research,
through product evaluation and customer accept-
ance to final production. Product and process
development alone may take as long as 24
months and product evaluation over 14 months.
In general, it appears that if either add-on control
systems are used or new low solvent systems need to be
developed, deadlines may need to be extended.
The Western Acadia plant personnel, however, indicated
that they would probably not have any difficulty meeting
proposed deadlines since a relatively small scrubber would
be required. Joanna Western Mills may have a problem meeting
the RACT timing requirements if equipment availability is a
problem. Several individual incinerator systems will be
needed at the plant; it does not appear practical to use a
single system because of the number of coating lines and
vagaries of production schedules.
6.6.2 Technical Feasibility Issues
As discussed above, low solvent or solventless mater-
ials are used in many coating operations. At present, however,
many types of solvent-based systems have no satisfactory re-
placement. The alternative materials do not meet the product
quality standards demanded by the coaters. Additional
development is needed and will require the combined efforts
of both the coaters (who must maintain product quality) and
the coating material suppliers. Ideally, the new coating
materials should be adaptable to existing coating equipment
to minimize additional capital investment.
As discussed above, both incineration and carbon
adsorption are not completely satisfactory add-on control
systems. Incineration requires large volumes of additional
fuel if good heat recovery is not achieved; carbon adsorp-
tion is not usuable on many coating systems because of the
multiplicity of compounds used in solvent mixtures.
6.6.3 Comparison of Costs with Selected Economic
Indicators
The net increase in the annualized costs to coaters
cannot be estimated with a high degree of confidence since
direct costs are highly sensitive to various retrofit
situations, the efficiency of heat recovery and other factors,
as discussed above. Based on the estimated annual costs of
about $0.61 million to $0.85 million, and the estimated value
of shipments of the two firms, annual compliance costs would
6-20
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be about 1.5 to 2.1 percent of the value of shipments.
In a recent report,^ increased costs for control of
emissions from a rubber coating line using incineration
with primary heat recovery were estimated to be about 0.9
percent of the price of the finished rubberized fabric.
The major economic impact in terms of cost to individual
companies will probably be capital related rather than from
the increased annualized costs. According to discussions
with Joanna Western Mills personnel, the capital required for
RACT compliance represents a significant amount of capital
for the plant and may force the company to consider shutting
down affected operations.
6.6.4 Selected Secondary Economic Impacts
This section discusses the secondary impact of imple-
menting RACT on employment, market structure and productivity.
Total employment in the state is expected to be marginally
affected since about 400 production workers are employed by the
plants identified. Joanna Western Mills may terminate some
coating operations if compliance costs are prohibitive. However,
coating is only a part of the operation at this plant and
personnel terminations are expected to be minimal.
There would be no change in the market structure within
the state since the firms identified are in different markets
and have different product lines.
Productivity is not expected to be affected except for
a short period when lines must be shut down for modifications
or installation of equipment.
Exhibit 6-12, on the following page, summarizes the
conclusions and projected implications of the results from
this study.
1 Springborn Laboratories, Inc., op. cit.
6-21
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EXHIBIT 6-12
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR FABRIC COATERS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected facilities
Indication of relative importance of
industrial section to state economy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control to
meet RACT guidelines
Discussion
Two firms were identified as being affected
by the proposed regulation
The two plants affected are estimated to have
annual shipments of $30 million to $40 million.
These plants employ about 400 persons.
Newer plants are built with integrated coating
and emission control systems; older plants are
only marginally competitive now
Current emissions are estimated at about 600
tons/year
Direct fired incineration and water scrubbing
for shoft range, low solvent coatings are a
long range goal.
Direct fired incineration with primary
heat recovery.
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market Structure
RACT timing requirements (1982)
Problem areas
VOC emissions after RACT control
Cost effectiveness of RACT control
Discussion
Study team estimate is about $2.4 million
to $3.1 million.
Approximately $0.61 million to $0.85 million.
Assuming a "direct pass-through of costs"
prices of coated fabrics will increase by about
1.5 to 2.1 percent.
Assuming 35 percent heat recovery, about 5,500
equivalent barrels of additional fuel oil would
be required per year
No major impact
No major impact
No change in market Btructure within the state
is anticipated; firms affected have different
product lines
Plants may have problem in control equipment
deliveries
Additional capital and operating costs may make
the plants uncompetitive with more modern and
efficient ones
Capital and operating costs can only be approxi-
mated because of unknown retrofit situations
120 tons/year (20 percent of 1977 VOC emissions)
$1,250 to $1,750 annualized cost/annual ton
of VOC reduction.
Note; Cost data are based on emission information supplied by the Illinois EPA.
Source: Booz, Allen & Hamilton Inc.
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BIBLIOGRAPHY
Davidson's Textile Blue Book, 1977.
T.W. Hughes, et al., Source Assessment; Prioritization
of Air Pollution from Industrial Surface Coating Operations,
Monsanto Research Corporation, Dayton, Ohio. Prepared for
U.S. Environmental Protection Agency, Research Triangle Park,
N.C., under Contract No. 68-02-1320 (Tech. 14) Publication
No. 650/2-75-019a.
T.A. Kittleman and A.B. Akell, "The Cost of Controlling
Organic Emissions," Chemical Engineering Progress, April 1978.
Springborn Laboratories, Air Pollution Control Engineering
and Cost Study of General Surface Coating Industry, Second
Interim Report, EPA Contract No. 68-02-2075, August 23, 1977.
Textile Economics Bureau, Technicon, November 1977, State
Industrial Directories Corporation, 1978-79 Illinois State
Industrial Directory, October 1978.
Thomas Register of American Manufacturers, 1978.
U.S. Department of Commerce, County Business Patterns,
Illinois, 1976.
U.S. Department of Commerce, Annual Survey of Manufactures,
1976, Industry Profiles, M76(AS)-7
U.S. Department of Commerce, Annual Survey of Manufactures,
1976, Value of Product Shipments, M76(AS)-2
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Existing Stationary Sources, Volume I,
EPA-450/2-76-028, May 1977.
U.S. Environmental Protection Agency, Control of Volatile Organic
Emissions from Existing Stationary Sources, Volume II, EPA-450/2-
77-008, May 1977.
U.S. Environmental Protection Agency, Regulatory Guidance for
Control of Volatile Organic Compounds Emissions from 15
Categories of Stationary Sources, EPA-950/2-78-001, April 1978.
-------
Private conversations with:
Canvas Products Association International, St Paul,
Minnesota
Overly, Inc., Neenah, Wisconsin
Textile Economics Institute, New York City, New York
TEK Systems, DePere, Wisconsin
Joanna Western Mills, Chicago, Illinois
Western Acadia, Chicago, Illinois
Bobst Champlain, Roseland, New Jersey
REECO, Inc., Morris Plains, New Jersey
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7.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF AUTOMOBILES
IN THE STATE OF ILLINOIS
-------
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7.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF AUTOMOBILES
IN THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT for surface coating of automobiles in the
State of Illinois.
The capital cost and energy requirements to achieve the
recommended RACT limitations were anticipated to be higher
than for any other industrial category studied. In addition,
the EPA is currently considering modifying the limitations in
certain areas. Therefore, the economic impact and analysis
for surface coating of automobiles is presented in two scenarios
of RACT implementation:
RACT compliance by 1982
Modified RACT requirements to meet specific
technologies.
To the extent that light duty trucks are also manufactured in
the same automobile assembly plant, their impact is included.
The chapter is divided into five sections including:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of the
application of surface coatings on automobiles, interviews,
industry public hearing submissions and analysis.
7-1
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7.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact
for the surface coating of automobiles in Illinois.
An overall assessment of the quality of the estimates
is detailed in the latter part of this section.
7.1.1 Industry Statistics
The potentially affected facilities were identified from
the emission inventory and from Ward's Automotive Yearbook.
Detailed industry statistical data for value of shipments,
capital expenditures, employment, etc., were not available for
the state in secondary sources (only two companies manufacturing)
Therefore, these estimates were factored from national data
based on the number of units output in the state and study team
analysis.
The number of units manufactured in 1976 was obtained
from Ward's Automotive Yearbook.
7.1.2 VOC Emissions
Booz, Allen estimated the 1977 VOC emissions based on
information provided by the Illinois EPA and industry interviews.
7.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for the surface
coating of automobiles are described in Control of Volatile
Organic Emissions from Existing Stationary Sources—Volume II
(EPA-450/2-77-008, May 1977). Manufacturers were interviewed
to ascertain the most feasible types of control for organic
emissions in the coating of automobiles.
7-2
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7.1.4 Cost of Control of VOC Emissions
The costs of control of volatile organic emissions were
developed by:
Determining the alternative types of control
systems likely to be used
Estimating the probable use of each type of
control system
Defining system components
Developing installed capital costs for modifi-
cations of likely coating processes based on
industry estimates, EPA estimates and Booz, Allen
study team judgment
Developing costs of control for the likely coating
processes on a model plant basis:
Installed capital costs
Direct operating costs
Annual capital charges
Energy requirements
Applying model plant costs to the specific facilities
affected in the state and aggregating costs to the
total industry for the state.
These costs were presented for two scenarios of RACT
implementation:
RACT compliance by 1982
Modified RACT requirements to meet specific
technologies.
Under the first scenario (RACT compliance by 1982), a
waterborne system similiar to the systems used in developing
RACT guidelines was studied.
Under the second scenario, a high solids enamel topcoat
system (or other equivalent technology) that is not fully
developed (commercially for automobile coatings) was studied.
7-3
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7.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements to implement RACT, assessing the
feasibility of instituting RACT controls in terms of capital
availability and equipment availability, comparing the direct
costs of RACT control to various state economic indicators and
assessing the secondary effects on market structure, employment
and productivity as a result of implementing RACT controls in
Illinois.
7.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls on the surface coating of automobiles in Illinois.
A rating scheme is presented in this section to indicate the
quality of the data available for use in this study. A rating
of "A" indicates hard data (data that are published for the
base year), "B" indicates data that were extrapolated from hard
data and "C" indicates data that were not available in secondary
literature and were estimated based on interviews, analysis of
previous studies and best engineering judgment. Exhibit 7-1,
on the following page, rates each study output listed and the
overall quality of the data.
7-4
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Study Outputs
EXHIBIT 7-1
U.S. Environmental Protection Agency
SURFACE COATING OF AUTOMOBILES
DATA QUALITY
Hard Data
B
Extrapolated
Data
Estimated
Data
Industry statistics
Emissions
X
Cost of emissions control
Economic impact
Overall quality of data
X
Source: Booz, Allen & Hamilton Inc.
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7.2 INDUSTRY STATISTICS
Industry characteristics, statistics and trends for
automobile assembly plants in Illinois are presented in this
section. Data in this section form the basis for assessing
the impact of implementing RACT for control of VOC emissions
for automobile manufacturing plants in the state.
7.2.1 Size of the Industry
There are two major automobile manufacturing facilities
that would be affected by the RACT guidelines in Illinois.
Chrysler has an assembly plant in Belvidere and Ford has an
assembly plant in Chicago. Exhibit 7-2, on the following page,
presents the potentially affected facilities and the approxi-
mate number of automobiles manufactured.
In 1977, there were approximately 280,000 automobiles
manufactured in Illinois, approximately 3.5 percent of the
automobiles manufactured in the U.S. The 1977 value of
shipments in Illinois was approximately $1.6 billion. The
industry employed approximately 7,000 to 8,000 people. The
capital expenditures for these two plants are not available;
however, historically the expenditures in the auto industry
nationwide for new plant and new equipment is 1-2 percent
of the value of shipments.
7-5
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EXHIBIT 7-2
U.S. Environmental Protection Agency
LIST OF POTENTIALLY AFFECTED
FACILITIES BY THE RACT
GUIDELINE FOR SURFACE COATING
OF AUTOMOBILES - ILLINOIS
Company or Make and Type of Automobile Production
Division Location Vehicle Manufactured for 1976 Model Year
Chrysler-Belvidere Belvidere Plymouth Horizon and 117,000
Assembly Dodge Omni
Ford-Automotive Chicago Thunderbird 165,000
Assembly Division
Total, Illinois (approximately 3.5 percent of U.S.
total automobile production) 282,000
Source: Plants of U.S. Motor Vehicle Manufacturers, 1978, Motor
Vehicle Manufacturers Association of the United States, Inc.
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7.2.2 Comparison of the Industry to the State Economy
The Illinois automobile industry employs 0.6 percent of
the state labor force, excluding government employees, and
represents approximately 1.5 percent of the statewide value
of products manufactured.
,7.2.3 Characterization of the Industry
The RACT guidelines apply only to automobile assembly plants
and not to custom shops, body shop or other repainting operations,
The automobile assembly industry receives parts from a variety
of sources and produces finished vehicles. Various models,
usually of the same general body style, may be built on an
assembly line. Assembly lines typically operate at 30 to 75
vehicles per hour and produce approximately 4,000 vehicles per
year.
The automobile manufacturing industry is unique in that
these companies are large and have extensive expertise in the
coatings technology developed. The surface coating of the
automobile must offer adequate protection against corrosion as
well as provide an attractive appearance and durability for the
customer. In developing technologies to meet the market needs,
the manufacturers have extensive capital invested in specific
technologies. The major difference in current technology within
the industry is the raw material and the associated equipment
used for top coating applications. General Motors has tradi-
tionally utilized lacquer systems while other manufacturers
traditionally utilize enamel coatings. In 1977, there were
only two plants using waterborne enamels, Van Nuys and South
Gate California, both General Motors facilities. For prime
coating of automobiles there has been a recent trend towards
water-based cathodic electrodeposition because of the increased
coverage, uniformity and paint recovery. Some of the anodic
electrodeposition facilities installed in the late 1960s
and 1970s have converted to cathodic to eliminate odor
problems and further improve corrosion protection. However,
the majority of the plants in the U.S. still utilize spray,
dip or flow coating with solvent-based coatings.
7-6
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7.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents an overview of the types of coating
process alternatives that might be used to reduce emissions
from the surface coating of automobiles.
7.3.1 Process Description of Surface Coating of Automobiles
There are two major process areas for the surface coating
of automobiles:
Prime coat
Topcoat.
Processes for assembly of automobiles are described in
Control of Volatile Organic Emissions from Existing Stationary
Sources—Volume II (EPA-450/2-77-008, May 1977).
This section provides a summary of central technologies
that may be used for reducing solvent emissions.
7.3.1.1 Primers
The prime coat serves the dual function of protecting the
surface from corrosion and providing for good adhesion of the
topcoat. Currently, most primers used are organic solventborne
and are applied by a combination of manual and automatic spray,
dip or flow coating methods. However, there are a number of
new low-organic solvent-based primers, now used in limited
quantities, that could replace these:
Electrodeposition primers—These are electro-
phoretically deposited waterborne primers.
The process can be either cathodic or anodic.
The cathodic, which was developed more recently,
offers an improved corrosion protection but
does have slightly more VOC emissions than the
anodic process. Many automobile assembly facili-
ties have recently invested substantial capital
to convert facilities to the cathodic electro-
deposition process.
Waterborne primers—These are waterborne
primers that are applied by spray, dip or flow
coating processes. The processes require less
capital than an electrodeposition process
but do not offer the product quality advantages.
Powder primers—This technology is still in early
development stages but it could offer significant
emission reductions. Major technical problems to
date have been the significant processing changes
required and product smoothness.
7-7
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7.3.1.2 Topcoats
Two types of topcoats are currently used in industry—
lacquers and enamels. Most General Motors facilities are
based on lacquer technology while the other automobile manu-
facturers all employ enamel topcoats. There are a number of
technology developments which may apply in future periods.
Waterborne topcoats—Reductions in organic solvent
emissions of up to 92 percent from topcoat spray booths
and ovens are achievable using waterborne topcoats.
The exact reduction depends on both the original
coating and the replacement. If, for example, the
lacquer (6.5 pounds of organic solvent per gallon
of coating) and the waterborne had 2.8 pounds of
organic solvent per gallon of coating (as do OM
coatings in California), reduction would be 92
percent. If the original coating were 33 volume
percent solids, reduction would be 70 percent.
Waterborne topcoats are currently being used at
two General Motors automobile assembly plants in
California on a full-scale basis. Although there
can be no argument as to the technical feasibility
of waterborne topcoats, the number of major process
modifications necessary to retrofit this technology
to an existing plant are significant (often requiring
a completely new processing line). Also, the utili-
zation of energy is much greater than for solvent
systems.
Powder coatings—Acrylic powder coatings have been
evaluated as topcoats for General Motors and Ford
cars on a development basis at Framingham, Massachu-
setts, and Metuchen, New Jersey. Along with process
color change and other difficulties that are poten-
tially correctable, the greatest remaining obstacle
to powder utilization as an automotive topcoat is
the lack of an acceptable metallic color. This
commercial unacceptability of powder metallic
colors would be a particular problem, since over
50 percent of cars manufactured over the past
several years have been metallic.
Although very low in hydrocarbon emissions, powder
coating do not represent a viable approach for
automobile manufacturers in the near-term future.
7-8
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High solids (60-80 percent by volume solids) two-
component urethanes—Considerable research effort
is being devoted to high solids (60-80 percent by
volume solids) low-temperature curing urethane
systems. Experience with urethanes in general
in the aircraft industry indicates excellent
weathering and environmental resistance at the
low coating weights required on aircraft, although
the urethanes used are not at 60-80 percent solids
as applied.
At this point in time, there does not appear to
have been any major evaluation by automotive manu-
facturers of the high solids materials.
High solids urethane systems do offer significant
potential in reducing emissions and energy costs,
but would not be expected to be available for auto-
motive use in the near future.
An additional problem with urethanes is the expo-
sure to isocyanates from the coatings. Exposure would
have to be minimized to assure worker safety.
High solids (35-55 percent by volume solids) disper-
sion lacquers—Many suppliers have taken an inter-
mediate approach to high solids systems. For
example, a 55 percent solids dispersion system
is currently in use on trucks in Canada on an
advanced development basis. High solids dispersion
systems (35 percent) have also recently been
evaluated at an Oldsmobile plant.
None of these, however, have been production proven on
automotive lines and additonal development would be
required to evaluate their performance.
High solids (30-62 percent by volume solids) enamels—
All major automobile manufacturers other than
General Motors use enamel topcoats. The average
solids content of enamels currently being applied
is approximately 30 percent; metallic colors
usually have a lower solids content. Paint suppliers
and the automotive industry are actively attempting
to achieve higher solid enamels.
7-9
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In the short term (one to two years) some higher
solids colors may be available for use; however, it
is unlikely that the full color offering (especially
metallics) could be converted to high solids tech-
nology.
7.3.2 Emissions and Current Controls
This section presents the estimated VOC emissions from
automobile assembly facilities in Illinois in 1977 and the
current level of emission controls implemented in the state.
Exhibit 7-3, on the following page, shows the total emissions
from the two facilities affected. The VOC emissions are estimated
based on the following level of current control and coating
processes:
Chrysler facility in Belvidere was recently con-
verted from manufacturing full-sized cars to
making the subcompact Dodge Omni and Plymouth
Horizon. The total 1977 VOC emissions from the
facility were approximately 2,600 tons per year.
Of the current emissions 132 tons per year are
from waterborne prime coat which are assumed to
meet the RACT guidelines.
Prime coats—After an initial waterborne dip
coating, the auto bodies enter a primer booth
with five application stations:
Manual electrostatic spray for body
interior
Air-atomized automatic guns
Manual spray reinforcement
Air atomizer automatic guns
Manual spray reinforcement.
- Lower body painting—Auto bodies for two tone
colors and receiving a black acrylic coating on
the lower body are separated from the main
conveyor to a different one. At this conveyor
the lower portion is spray painted and then
transported back to the main conveyor.
Topcoat—The topcoat booth consists of five
application situations:
Manual spray painting
Programmed automatic spray
Manual spray painting
Programmed automatic spray
Final touch-up manual spray.
7-10
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EXHIBIT 7-3
U.S. Environmental Protection Agency
ILLINOIS EMISSIONS-SURFACE
COATING OF AUTOMOBILES
Facility/ Coating Estimated
Location Process 1977 VOC Emissions
'(tons per year)
Chrysler Corporation Prime Coat 954a
Belvidere, IL. Topcoat 1,307
Repair 319
2,580
Ford Corporation Prime Coat (E Coat) 70
Chicago, IL. Topcoat 1,082
Flow Coat 217
Repair 23
1,392
Total, Illinois 3,972
a. Approximately 132 tons per year of the prime coat represents
high solid coating and would be controlled emissions under
the RACT guidelines.
b. The prime coat at the Ford facility is a cathodic electro-
deposition primer, which is assumed for purposes of this
analysis to meet the RACT requirements. The Ford estimated
emissions are higher than the Illinois EPA estimates by
approximately 50 tons per year.
Source; Illinois Environmental Protection Agency, Booz, Allen
& Hamilton Inc.
-------
The Ford facility in Chicago recently converted the
prime coat application to a cathodic electrophoretic
system "E-Coat." Although the proposed EPA limitation
for prime coat is based on anodic E-coat systems,
for purposes of this study it is assumed the current
prime coat operation would meet the control requirement
of RACT.
The cathodic E-coat solvent content is approxi-
mately 2.0 pounds per gallon versus the anodic
solvent content recommended by the RACT guidelines
of 0.8 pounds per gallon.
The current topcoat application utilizes an enamel
coating with approximately 28 percent solids.
- The current final repair utilizes an enamel with
approximately 30 percent solids.
7-11
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7.3.3 RACT Guidelines
The RACT guidelines (as recommended in EPA-450/2-77-008)
for VOC emission control specify the amount of allowable
VOC in pounds per gallon of coating, minus any water in the
solvent system. The RACT guidelines have established different
limitations .for each process operation. These recommended
limits are shown in the table below.
Average Lbs. VOC/
Affected Gallons of Coating
Process Operations Minus Water
Prime application and flash-off 1.9
area, and oven
Topcoat application, flash-off 2.8
area, and oven
Final repair application, flash- 4.8
off area, and oven
These limits apply to all objects surface coated in the
plant, including the body, fenders, chassis, small parts, wheels
and sound deadeners. It does not apply to adhesives.
These guidelines, as stated, are very specific to certain
types of control options, either in emission limit or timing,
that may be subject to change by the EPA, in the near future.
The prime coat application limitations were based
on an anodic electrodeposition system followed
by a 25 percent solids waterborne surface coat
for thickness and improved adhesion of the top-
coat. Since the guideline development, it has
been recognized that a cathodic electrodeposition
system offers additional benefits especially
in the areas of increased corrosion protection
and odor control. With current coating technology,
the 1.9 pounds per gallon limitations of the RACT
guidelines cannot be achieved with a cathodic system
(emissions would be approximately 2.1 pounds per
gallon). In light of continued technology develop-
ment and potential change in limits, it was assumed
for purposes of this anaylsis, that a cathodic
electrodeposition process with emissions of
approximately 2.1 pounds per gallon would meet
the RACT requirements.
7-12
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The topcoat limits were based on water-
borne systems that were introduced at the
General Motors South Gate and Van Nuys,
California, facilities to meet Los Angeles
emission regulations. For purposes of
this analysis, two scenarios were assumed
in which RACT topcoat limitations could
be met—(1) waterborne coatings and (2)
other technology with equivalent emission
character. It is anticipated that new
technology will be developed which will
effect reductions equivalent to water-
borne coatings at lower costs and energy
use.
7.3.4 Selection of the Most Likely RACT Alternatives
Projecting the most likely industry response for control
of VOC emissions in automobile assembly facilities is compli-
cated by the different processing techniques manufacturers have
in place and the potential change of recommended RACT limita-
tions. Several general assumptions can be made.
The RACT limitations as recommended (EPA-450/2-77-
008) for prime coat application, flash-off area and
oven are specifically based on use of an anodic
electrodeposition system followed by a 25 percent
solids waterborne coating. Recent technology
developments in cathodic electrodeposition provide
an improved system (versus anodic electrodeposition)
and, therefore, this is likely to be the preferred
industry response wherever feasible. A cathodic
system has somewhat higher solvent content than anodic
electrodeposition systems. The capital and operating
costs for both electrodeposition systems are similar.
The RACT limitations, as recommended for topcoat
application, flash—off area and oven, are specifically
based on use of waterborne coatings at two General
Motors facilities. Although this alternative is
extremely capital and energy intensive, it is the
only currently available proven alternative that
would meet the recommended RACT limitations, if
compliance is required by the 1982 timeframe.
Other topcoat coating technologies (such as high
solids enamels, urethane enamels or powder coatings)
could potentially offer significant emission reduc-
tion and be cost effective for manufacturers. These
alternative materials are generally more expensive on a
per pound basis in relation to current coatings. The
coating cost per vehicle would be less only if thinner
coats could be applied. However, these application
technologies are at various stages of development
and none have been technically proven for an automotive
assembly plant.
7-13
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The industry will install incinerators only as a
last resort if there is no economically feasible,
low solvent coating technology available. The annual
cost of energy requirements for the incineration of
large volume and low concentration air flows (such
as would be required to control the total facility) is
generally cost prohibitive. Incineration may, however,
be used in combination with coatings of reduced solvent
content to produce emission levels in accord with the
RACT guidelines. For instance, an assembly plant using
a topcoat enamel system may use a higher solids enamel
and incinerate a portion of the emission from the spray
booths or ovens. /
Carbon adsorption systems are not a likely control
alternative because of the large air flow rate
of the spray system.
Due to the uncertainty of the industry response to the
RACT recommended limitations, two scenarios of selection of
alternatives were developed for purposes of this study.
Scenario I (High Side)—the industry response
to meet the recommended RACT limitations by
1982 would be:
Prime coat—anodic or cathodic
electrodeposition
Topcoat—waterborne coating
Final repair—solventborne enamel with
35 percent solids
Scenario II (Technology Dependent)—RACT requirements
are modified to meet specific technologies.
Exhibit 7-4 and 7-5, on the following pages, present the
selection of the most likely RACT alternatives under the two
scenarios.
7-14
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EXHIBIT 7-4
U.S. Environmental Protection Agency
SELECTION OF THE MOST LIKELY RACT
ALTERNATIVES UNDER SCENARIO I (RACT
COMPLIANCE BY 1982)
Processing
Area
Primer
Control
Alternatives
Anodic electrodeposition
primer followed by water-
borne "surfacer"
Cathodic electrodeposi-
tion primer followed by
a waterborne or high
solids "surfacer"
Topcoat
Spray, dip or flow coat
solvent-based primers
with incineration
Waterborne enamels
Repair
35 percent solids
enamel
Current or modified
coatings with incin-
eration
Discussion
Very low VOC emission
levels are achievable
yet system has some
technology disadvantages
to other alternatives
Offers improved corrosior
protection and eliminates
odor problem of anodic
"E-coat"
VOC emission levels are
moderately higher than
the recommended RACT
limitations
High operating cost for
energy demands
Only technologically
proven alternative that
would meet the RACT
requirements
Extremely high capital
cost and energy require-
ments
Technology is not fully
developed, i.e., some
colors cannot be matched
with currently available
coatings
High operating cost for
energy demands
Source; Booz, Allen & Hamilton Inc.
-------
EXHIBIT 7-5 (1)
U.S. Environmental Protection Agency
SELECTION OF THE LIKELY RACT
ALTERNATIVES UNDER SCENARIO II
Processing
Area
Primer
Control
Alternatives
Anodic electrodeposition
primer followed by water-
borne "surfacer"
Cathodic electrodeposi-
tion primer followed by
a waterborne or high
solids "surfacer"
Other spray, dip or
flow coat primers with
incineration
Powder coatings
Topcoat
Waterborne enamels
Discussion
Very low VOC emission
levels are achievable
yet system has some
technology disadvantages
to other alternatives
Offers improved corrosioj
protection and eliminate!
odor problem of anodic
"E-coat"
VOC emission levels are
moderately higher than
the recommended RACT
limitations
High operating cost for
energy demands
Undeveloped technology,
however, has potential
applications for use
on steel or as "surfacer
Low VOC emission levels
might be achievable and
cost effective
Only technologically
proven alternative that
would meet the RACT
requirements
Extremely high capital
cost and energy require-
ments
-------
EXHIBIT 7-5(2)
U.S. Environmental Protection Agency
Processing
Area
Control
Alternatives
High solids enamels
Urethane enamels
Powder
Repair
35 percent solids
enamel
Discussion
Technology to achieve
the 62 percent solids
required by RACT limi-
tations is not developed.
However, paint suppliers
are optimistic for
potential application
of up to a 55 percent
solids enamel
If technology develops,
only minor modifications
would be required at
facilities currently
using enamels
Major modifications
would still be required
for facilities using
lacquer coatings
Technology is not
developed
Potentially large
energy savings and
improved properties
Toxicity protection is
required for workers
Technology is not
developed
Potential energy and
recovery savings
Color limitations
Technology is not fully
developed, i.e., some
colors cannot be matched
with currently available
coatings
-------
EXHIBIT 7-5(3)
U.S. Environmental Protection Agency
Processing Control
Area Alternatives Discussion
Current or modified coat- High operating cost for
ings with incineration energy demands
Source; Booz, Allen & Hamilton Inc.
-------
7.4 COST AND VOC BENEFIT EVALUATIONS FOR THE MOST LIKELY RACT
ALTERNATIVES
Costs for the two assumed scenarios of alternative VOC
emission controls are presented in this section. Under Scenario
I, it is assumed that the RACT requirements would be met by a
waterborne system. Under Scenario II, it is assumed that the
RACT requirements are modified to meet specific technologies.
The costs presented in this section are based on studies
performed by the EPA and automobile manufacturers to determine
the estimated costs for actual plants. The study team utilized
published data to develop the cost estimate presented in the
section. The final section presents an extrapolation of the
typical costs for automobile assembly plants to meet the
RACT requirements for the two scenarios.
7.4.1 Costs for Alternative Control Systems under Scenario I
Under Scenario I, it is assumed that the RACT requirements
must be met with existing proven technology. Therefore, the
following control alternatives are assumed:
Cathodic or anodic electrodeposition of
primers. Although the RACT requirements of
1.9 pounds of VOC emissions per gallon of
coating are specific for the anodic process,
this analysis assumes that cathodic electro-
deposition of waterborne coatings would meet
the RACT requirements
Waterborne topcoat system
35 percent volume solids enamel repair system.
A electrodeposition waterborne system can be used only
directly over metal or other conductive surfaces. Although the
system offers an improved product advantage over other types of
primer application methods, the conversion represents a signifi-
cant capital cost. The cost of conversion for a typical electro-
deposition system at an automobile assembly plant is presented
below.1 Costs will vary significantly depending on the retrofit
situation.
The installed capital cost would be approximately
$10 million to $12 million, not including additional
energy requirements (if necessary).
1 These cost estimates were developed by the Booz, Allen study
team after a review of operating costs reported in Control of
Volatile Organic Emissions from Existing Stationary Sources—
Volume II(EPA-450/2-77-008) and estimates provided by General
Motors, Ford Motor Company, and American Motors in Technical
Support Documentation for the states of Ohio, Illinois and Wisconsin.
7-15
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Direct operating costs (utilities, direct labor
and raw materials) would be approximately $20,000
less annually than conventional application
techniques.
Interest, depreciation, taxes and insurance are
estimated to be approximately $1.5 million annually
(assuming 15 percent of capital investment based
on a 25-year equipment life and 10 percent interest
rate).
Therefore, the total annualized cost of the conver-
sion to an electrodeposition waterborne system would
be approximately $1.5 million.
The additional energy demands are estimated to be
5 million to 6 million kilowatt hours per year.
If the electrodeposition system were anodic, the resulting
VOC emissions would be approximately 1.9 pounds of VOC per gallon
of coating for the priming operation including primer surfacer.
If the electrodeposition system were cathodic, the resulting
VOC emissions would be approximately 2.5 pounds of VOC per
gallon of coating. For purpose of economic analysis, it is
assumed that both anodic and cathodic EDP require essentially
equivalent cost.
The conversion of the topcoat application to a waterborne
system would require extensive modification of the existing
facilities, essentially equivalent to the cost of new line. The
conversion would require changes, such as humidification equip-
ment, a longer spray booth, new ovens, replacement of existing
piping with stainless steel piping, sludge handling equipment,
floor conveyors (for some facilities) and additional power
generating equipment. The conversion cost for a waterborne
system has been estimated by the EPA and all the major automobile
manufacturers. These estimates may differ by 100 percent, depending
on the particular facility being studied. After an evaluation
of these cost estimates and the EPA cost estimates in the
RACT guidelines, the study team found that a typical facility
is likely to incur the following costs to convert to a
waterborne system.!
The installed capital cost would be approximately
$40 million to $50 million, including additional
power requirements.
Incremental direct operating costs (utilities,
direct labor and raw materials) would be approxi-
mately $750,000 annually, mostly for energy.
Interest, depreciation, taxes, and insurance
are estimated to be approximately $7 million
annually (assuming 15 percent of capital
based on a 25-year equipment life and 10 percent
interest rate).
1Ibid.
7-16
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The annualized cost of the conversion to
a waterborne system would be approximately
$8 million.
The additional energy demands are estimated
to be equivalent to approximately 38,000
equivalent barrels of oil annually.
The resulting VOC emission from a waterborne topcoat
system would be approximately 2.8 pounds of VOC per gallon of
coating.
The cost of conversion to a 35 percent enamel for topcoat
repair is assumed to be minimal in relation to the conversion costs
for the other coating applications. A 35 percent topcoat repair
enamel cannot be obtained today for all types of paints applied.
However, this limitation might be met by incinerating a portion
of the total emissions to achieve the equivalent of a 4.8 pounds
per gallon limitation.
7.4.2 Cost for Alternative Control Systems under
Scenario II
Under Scenario II, it is assumed that the RACT requirements
are modified to meet specific technologies. Therefore, the
following control alternatives are assumed:
Cathodic or anodic electrodeposition of
primers is used.
High solids enamels, urethane enamels or
powder coatings technologies are developed
for topcoat application.
35 percent solids enamel is used for topcoat
repair.
The conversion cost for a electrodeposition waterborne
system would be the same as developed for Scenario I.
The conversion of the topcoat application to a high
solids enamel, urethane enamel or powder coating would
depend on the particular system applied and the current
coating technology used by the manufacturer.
Since both manufacturers in Illinois currently use
enamel topcoating, this analysis assumes
that they would meet the RACT requirements
with high solids enamel technology develop-
ments .
7-17
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Under this scenario, minimal capital
and operating costs changes would
be required as the existing equipment
is likely to be adjustable to higher
solids coatings.
The average VOC emissions per gallon of
coating would depend on the high solids
enamels that are developed. Depending
on the timing constraints, high solid
enamels ranging from 40 percent to 63
percent could be achieveable based on
projected technology developments
that are currently being applied by
other industrial sectors.
Exhibit 7-6, on the following page, presents the conversion
costs for the two scenarios developed.
7.4.3 Extrapolation to the Statewide Industry
Exhibit 7-7, following Exhibit 7-6, presents the extra-
polated costs of meeting the RACT guidelines under two scenarios
that were developed. These costs are based upon:
The estimates of cost of compliance under
the control alternatives in the two scenarios that
were presented in sections 7.4.1 and 7.4.2
The processing techniques at the two potentially
affected facilities in the state
Application of the model plant costs developed under
each scenario to each specific facility affected in
the state and aggregating the results (i.e., if
cathodic electrodeposition is already in operation
at a specific facility, the cost of compliance and
the resulting potential emission reductions would
not be included in this analysis).
7-18
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EXHIBIT 7-6
U.S. Environmental Protection Agency
ESTIMATED COST FOR MODEL PLANT TO
MEET AUTOMOBILE RACT REQUIREMENTS
SCENARIO I
Primer
Topcoat
Final Repair
Total,
Scenario I
Capital Cost
($ millions)
10-12
40-50
50-62
Direct
Operating Cost
($ millions)
(0.02)
0.8
0.78
Annualized
Capital Cost
($ millions)
1.5-1.8
6.0-7.5
7.5-9.3
Annualized
Cost--Rounded
($ millions)
1.6
8
Energy
Demand
(equivalent
barrels of oil)
13,000
37,000
9.6
50,000
SCENARIO II
Primer 10-12
Topcoat
(Enamel
Facilities/
Lacquer
Facilities)
Final Repair -
Total,
Scenario II 10-22
(0.02)
1.5-1.8
1.5-3.3
1.6
1.6-3.1
13,000
13,000
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 7-7
U.S. Environmental Protection Agency
STATEWIDE COSTS TO MEET THE RACT GUIDELINES
FOR AUTOMOBILE ASEMBLY PLANTS
Characteristic
Number of plants
1977 VOC emissions
(tons per year)
Scenario I
2
4,000
Scenario II
4,000
Potential emission
reduction
(tons per year)
2,700
1, 900-2,700*
VOC emissions after
RACT
(tons per year)
1,300
1,300-2,100
Capital cost
($ millions, 1977)
100
12
Annualized cost
($ millions, 1977)
15
Annualized cost per
ton of emission reduction
5,550
740-1050
a. Emission reduction based on average solids concentration
of topcoat of 40 percent to 62 percent.
Source; Booz, Allen & Hamilton Inc.
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7.5 DIRECT ECONOMIC IMPLICATIONS
This section presents the direct economic implications
of implementing RACT controls to the statewide industry, in-
cluding: availability of equipment and capital; feasibility
of the control technology; and impact on economic indicators,
such as value of shipments, unit price, state economic
variables and capital investment. In this section, both
scenarios that were developed for surface coating of auto-
mobiles are discussed.
7.5.1 RACT Timing
Under Scenario I, it is assumed that the recommended
RACT guidelines must be implemented statewide by 1982. This
implies that the automobile manufacturers must have either
low solvent coatings or VOC control equipment installed and
operating within the next four years. The timing of RACT
is discussed for each of the major processes within auto-
mobile facilities.
To meet the RACT requirement for primer coating
operations, cathodic or anodic electrodeposition
will have to be installed. In general, the
industry has been installing the cathodic electro-
deposition process over the past few years
and many new installations are planned over
the next few years.
These timing requirements for primers
represent a moderate forcing of the
current technology trend for most
manufacturers.
For Chrysler Corporation the conversion
to an electrodeposition process represents
significant changes in their current process.
Construction plans would have to start
immediately to meet the 1982 timeframe.
To meet the RACT requirements for topcoating
operations, the only proven technology existing
today is waterborne coating.
Conversion to waterborne coatings
represents a complete changeover of
existing facilities. Essentially,
new production lines would have to
be installed at both facilities in Illinois.
7-19
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Construction alone would probably take
between three to four years. Although
this deadline of construction might be
met if Illinois were the only state
implementing RACT, it could not be
met on a nationwide basis by automobile
manufacturers.
To meet the RACT requirements for final repair,
the equivalent of a 35 percent solids enamel
must be achieved.
At Chrysler and Ford, which both utilize
enamel systems, it has not been proven
that high solids enamels can be achieved
for metallic colors. The timing require-
ments might have to be met with add-on
control equipment in the short run (until
technology developments are proven for
high solids enamel repairs).
Under Scenario II, it is assumed that the RACT timing
requirements are modified to meet specific technologies. The
only major processing area where significant modifications
need to be adapted would be for topcoating.
It is likely that high solids enamels technol-
ogies will be developed over the next two or
three years, although it is highly unlikely
a 62 percent solids enamel could be developed
before 1982.
Topcoat changes at Chrysler and Ford are likely to
be substantial unless an adaptable technology
can be developed.
The sections which follow further discuss the feasibility
of implementing RACT within the required timeframe and the
economic implications.
7-20
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7.5.2 Feasibility Issues
Technical and economic feasibility issues of implementing
RACT controls are discussed in this section.
The RACT controls for primer operations could
be achieved by a 1982 timeframe if they are
modified to incorporate the cathodic electro-
deposition processing technology. However,
in some older facilities where changes are
extensive, additional time may be required.
The capital construction requirements to achieve
waterborne topcoat RACT limitations cannot be
achieved on a nationwide basis by 1982.
The automobile manufacturing industry has extensively
evaluated most of the approaches to meeting RACT.
The feeling in the industry is that RACT cannot be
achieved by January 1, 1982, using low solvent coatings-
primarily waterborne.
It is probable that the final repair limitations could
be achieved (with moderate technology advances) at all
automobile facilities currently using enamel systems.
7.5.3 Comparison of Direct Cost With Selected Direct
Economic Indicators
This section presents a comparison of the net increase
in the annualized cost of implementing RACT with automobiles
manufactured in the state, the value of wholesale trade in
the state and the unit value of automobiles.
Under Scenario I, which assumes that the recommended
RACT limitations are met with electrodeposition for primers,
waterborne topcoat processes and a 35 percent solids enamel
topcoat:
The capital requirement is estimated to be
$100 million, which represents approximately
400 percent of normal capital expenditures
(assuming current capital expenditures
represent 1.5 percent of value of shipments).
The net annualized cost increase is esti-
mated to be $15 million, which represents
approximately 0.9 percent of the statewide
auto industry's value of shipments.
7-21
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Assuming a "direct cost pass-through" the net
price increase would be approximately $50 per
car manufactured.
The automobile manufacturing industry represents
approximately 1 to 2 percent of the statewide economy
and the direct cost increase of compliance
represents approximately 0.01 percent of
the value of shipments statewide (all manu-
facturing industry).
Under Scenario II, which assumes that the RACT requirements
are modified to meet specific technologies:
The capital requirement is estimated to
be approximately $12 million, which
represents approximately 50 percent of
normal capital expenditures (assuming
capital expenditures represent 1.5 per-
cent of value of shipments).
The net annualized cost increase is approxi-
mately $2 million, which represents approximately
0.1 percent of the value of shipments.
Assuming a "direct cost pass-through" the price
increase would be approximately $7 per car
manufactured.
The direct cost increase of compliance represents
less than 0.01 percent of the value of shipments
statewide (all manufacturing industry).
7.5.4 Ancillary Issues Relating to the Impact of RACT
The automobile manufacturers are seeking to have the
guidelines altered to encompass a plant-wide emissions basis.
This would allow a credit from one operation, where emissions
were reduced to below the RACT recommended levels, to be
applied to another operation that is not in compliance under
this proposal. The plant would be in compliance if the total
emissions were reduced to the level proposed in RACT. It
appears that the impact of this proposed regulation, if
accepted, would be a reduction in compliance cost of the
RACT requirements. For instance, a manufacturer might
lower the emissions from prime coats below the RACT standard
to avoid installing emission control equipment for final
repair coating operations.
7-22
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7.5.5 Selected Secondary Economic Impact
This section discusses the secondary impact of implementing
RACT in employment, market structure and productivity.
The automobile assembly industry represents approximately
1 to 2 percent of Illinois' manufacturing industry and Illinois
ranks as the ninth largest automobile manufacturing state in
the nation.
If the recommended RACT limitations (Scenario I)
require waterborne coating technology, the
effect would probably be a total remodeling
of existing lines and facilities. This could lead
to the remodeling of the two existing facilities
with higher speed lines. This might represent
a decrease in employment at these facilities
and a moderate increase in productivity.
If the RACT limitations are modified to
developing technologies, no significant effects
on employment and productivity are forecast.
The effect is likely to be a slight decrease
in employment (20 to 30 employees) as tech-
nological improvements are incorporated.
Regardless of the RACT scenario implemented, no signi-
ficant change in market structure is likely to occur.
Under Scenario I, all manufacturers would
incur cost increases and none of the manu-
facturers stated that this would result
in market structure changes.
Under Scenario II, General Motors facilities in
other states are likely to incur higher costs than
other manufacturers but less cost per facility than
under Scenario I. General Motors feels that all of
the currently proven technology alternatives and final
repair would result in quality tradeoffs (with the
exception of retrofit control equipment).
Exhibits 7-8 and 7-9, on the following pages, present
a summary of the current economic implications of implementing
RACT under the two scenarios studied for automobile assembly
plants in the state of Illinois.
7-23
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EXHIBIT 7-8(1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO I FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF ILLINOIS
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
Number of potentially affected facilities
Indication of relative importance of indus-
trial section to state enconomy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC control
to meet RACT guidelines
Assumed method of control to meet RACT
guidelines
Affected Areas in Meeting RACT
Scenario I
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity and employment
Discussion
Two companies operating two facilities
1977 value of shipments was approximately
$1.6 billion which represents approxi-
mately 1.6 percent of the state's manu-
facturing industry. Of all states,
Illinois ranks ninth in automobile
production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
4,000 tons per year
Cathodic electrodeposition for prime
coat. High solids enamel for topcoat.
Cathodic electrodeposition for prime coat
Waterborne enamels for topcoat
High solids enamels for final repair
Discussion
$100 million (approximately 400 percent
of current annual capital expenditures
for the industry in the state)
$15 million (approximately 0.9 percent
of the industry's 1977 statewide value
of shipments)
Assuming a "direct cost pass-through"
approximately $50 per automobile manu-
factured
Increase of 87,000 equivalent barrels
of oil annually primarily for operation
of waterborne topcoating systems
Conversion to waterborne systems would
require total rework of existing pro-
cessing lines. Major modifications
would probably increase efficiency and
line speed.
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EXHIBIT 7-8 (2)
U.S. Environmental Protection Agency
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
Market structure
RACT timing requirements (1982)
Problem areas
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
Accelerated technology conversion to
electrodeposition primer coat
Conversion of all automobile assembly
plants nationwide to topcoating water-
borne systems cannot be achieved by 1981
Prime coat RACT limitations are based
on anodic electrodeposition systems
and should be modified to reflect
cathodic processing. Topcoat RACT
limitations are based on waterborne
coatings, which is not a cost or energy
effective alternative. Final repair
RACT limitations are based on high
solids enamel technology which is likely
to require major modifications for man-
ufacturer's using lacquer systems
1,300 tons per year (33 percent of 1977
emission level)
$5,550 annualized cost/annual ton of
VOC reduction
Source; Booz, Allen & Hamilton Inc.
-------
EXHIBIT 7-9(1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO II FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF ILLINOIS
SCENARIO II
(Modified RACT Requirements
To Meet Specific Technologies)
Current Situations
Number of potentially affected facilities
Indication of relative importance of indus-
trial section to state enconomy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC control
to meet RACT guidelines
Assumed method of control to meet RACT
guidelines
Affected Areas in Meeting RACT
Scenario II
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity and employment
Discussion
Two companies operating two facilities
1977 value of shipments was approximately
$1.6 billion which represents approximately
1.6 percent of the state's manufacturing
industry. Of all states, Illinois ranks
ninth in automobile production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
4,000 tons per year
Cathodic electrodeposition for prime
coat. High solids enamel for topcoat.
Cathodic electrodeposition for prime coat
High solids enamels for topcoat. High
solids enamel for final repair.
Discussion
$12 million (approximately 50 percent
of current annual capital appropriations
for the industry in the state)
$2 million (approximately 0.1 percent of
the industry's 1977 statewide value of
shipments)
Assuming a "direct cost pass-through"
approximately $7 per automobile manufac-
tured
Dependent on technology applied
No major effect
-------
EXHIBIT 7-9(2)
U.S. Environmental Protection Agency
SCENARIO II
(Modified RACT Requirements
To Meet Specific Technologies'.
Current Situation
Market structure
RACT timing requirements
Problem area
VOC emission after RACT control
Cost effectiveness for RACT control
Discussion
No major effect
Primer and final repair limitations could
be implemented at most facilities by 1982
Topcoat limitations could be set at a 40
percent to 62 percent solids by 1985
dependent on technology developments
Limitations for topcoat are dependent
on technology development
1,300-2,100 tons per year (33 percent to
52 percent of 1977 emission levels dependent
on limitations)
$740-$1050 annualized cost/annual ton
for VOC reduction
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
"Ford's War On Rust," Industrial Finishing. August 1978.
Carl A. Gottesman, "The Finishing Touch," Coat and Paintino ..
April 28, 1977, pp. 19-24.
"G.M.'s Mel Halstead Looks At...," Industrial Finishing.
April 1977, pp. 16-20.
Bruce N. McBane, "Automotive Coatings," Treastise on Coating ^t
Vol. 4; Formulations, Part I, R.R. Myers and J.S. Long, ed^N"'
New York, Marcel Dekker, 1975.
Herbert W. Reiner, "It Pays to Electrocoat, " Plating and
Surface Finishing. May 1976, pp. 15-20.
R.E. Roberts and J.B. Roberts, "Reducing Solvent Emissions ^n
Automotive Spray Paint," J. Air. Poll. Control Assoc. Vol. >6
No. 4 (April 1976), pp. 353-358.
Joe Schrantz, "The Lincoln Clear Coat Program," Industrial
Finishing. July 1978, pp. 20-23.
General Motors Corporation, Recommended VOC Emission Limitat ions
and Technical Support Document for the State of Ohio, ~-
Motor Vehicle Manufacturers Association of the U.S., Inc.,
Plants of U.S. Motor Vehicle Manufacturers. December 1977.
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Existing Stationary Sources, Vol. 1^.
EPA-450/2-77-008, May 1977.
Letter to Mr. Ned E. Williams, Director, Ohio Environmental
Protection Agency, from Environmental Activities Staff of G<->))Oral
Motors Corporation, August 16, 1978.
Private conversations at General Motors Warren, Michigan
Private conversations at American Motors, Detroit, Michigan.
Private conversations at Ford Motor Company, Dearborn, Michiqan
-------
-------
8.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
SURFACE COATING OF METAL
FURNITURE IN THE STATE OF
ILLINOIS
-------
-------
8.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
SURFACE COATING OF METAL
FURNITURE IN THE STATE OF
ILLINOIS
This chapter presents a detailed economic analysis
of implementing RACT controls for surface coating of metal
furniture in the State of Illinois. The chapter is
divided into six sections:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Cost and VOC reduction benefit for the most
likely RACT alternatives
Direct economic implications
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of
metal furniture plants, interviews and analysis.
8-1
-------
8.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for estimating:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for surface coating of metal furniture in Illinois.
The quality of the estimates is described in detail
in the last part of this section.
8.1.1 Industry Statistics
Industry statistics on metal furniture manufacturing
plants were obtained from several sources. All data were
converted to a base year 1977, based on specific scaling
factors. The number of establishments for 1977 was based
on the Illinois Point Source Emission Inventory and supple-
mented by a review of the 1976 County Business Patterns
and interviews with selected metal furniture manufacturing
corporations. The number of employees was obtained from
the 1976 County Business Patterns and refined based on
information obtained during interviews with selected metal
furniture manufacturers.
The industry value of shipments was estimated by
scaling up 1972 and 1975 published data to 1977, based on
industry growth rates presented in Predicasts. Because of
the lack of uniform data, different approaches were used
for the household furniture and business/institutional
furniture subcategories of this industry, as discussed
below.
8.1.1.1 Value of Shipments for Household Metal
Furniture
The 1976 Current Industrial Reports presented the 1976
U.S. value of shipments of household metal furniture (SIC
2514) as $1,161 million and indicated an 8.7 percent increase
in the value of shipments for 1977. The 1972 Census of
Manufactures reported that the value of shipments in the
East North Central region was 25 percent of the U.S. value
of shipments. The breakdown of the value of shipments in
this region was reported as follows:
8-2
-------
Percent of Percent of
State Regional Total U.S. Total
Ohio 7 1.8
Illinois 52 13.0
Michigan 4 1.0
Wisconsin 16 4.0
Indiana 21 5.3
The 1977 value of shipments of metal household fur-
niture in Illinois was estimated by scaling up the 1976
U.S. value of shipments to 1977 based on industrywide
growth rates and applying the above regional breakdown.
8.1.1.2 Value of Shipments for Business/Institutional
Metal Furniture
Business/institutional metal furniture includes
office furniture (SIC 2522), metal partitions (SIC 2542)
and public building furniture (SIC 2531). The value of
shipments for each of these groups was obtained as
follows:
For office furniture, the 1976 Current Indus-
trial Reports presented the U.S. value of
shipments as $1,002 million and indicated an 8
percent increase in the value of shipments for
1977. It also reported a 47.4 percent share
of the U.S. value of shipments for the East
North Central region. Since the regional break-
down of value of shipments was not available,
the regional breakdown by the number of estab-
lishments with 20 or more employees (as given
in the Current Industrial Reports) was used to
estimate the value of shipments for individual
states:
Percent of Regional
State Number of Establishments
Ohio 22
Illinois 15
Wisconsin 7
Michigan ' 50
Indiana 6
The 1977 value of shipments was estimated by
scaling up the 1976 U.S. value of shipments
to 1977 (based on industry growth rates by
Predicasts) and using the above breakdown.
8-3
-------
For metal partitions, which also include shelv-
ing, lockers, storage racks and accessories and
miscellaneous fixtures, the 1972 Census of
Manufactures reported the value of shipments
for Illinois as $118.5 million. The 1977 value
of shipments was estimated by assuming a 6
percent linear rate of growth between 1972 and
1977.
For public building furniture which includes
metal, wood and plastic furniture for stadiums,
schools and other public buildings, the 1972
Census of Manufactures reported the U.S. value
of shipments as $546.9 million and the value of
shipments for the East North Central region as
$197.9 million. The value of shipments for Ohio,
Indiana and Michigan was reported as $20 million,
$17.4 million and $90.2 million, respectively.
The data for Illinois and Wisconsin were not
reported. The breakdown among metal, wood and
plastic furniture was also not reported. Inter-
views with the metal furniture manufacturer in
Wisconsin indicated no manufacturing of public
building furniture there. Therefore, for the
purpose of this analysis, the remainder of the
East North Central value of shipments was
assumed to be manufactured in Illinois. Because
of the lack of data on the breakdown among metal
and other types, half of the total value of
shipments was assumed to be for metal furniture.
The 1977 value of shipments was estimated by
assuming a 6 percent linear rate of growth
between 1972 and 1977.
8.1.2 VOC Emissions
The VOC emissions were obtained from the Illinois
emissions inventory as reported in the June, 1978, "Memo-
randum on Technical Support for RACT" prepared by the
Illinois EPA and were modified by Booz, Allen by inter-
viewing several large plant operators.
8.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for metal
furniture plants are described in Control of Volatile
Organic Emissions from Stationary Sources, EPA-450/2-77-
032. The data provide the alternatives available for
controlling VOC emissions from metal furniture manufactur-
ing plants. Several studies of VOC emission control were
8-4
-------
also analyzed in detail, and metal furniture manufacturers
were interviewed to ascertain the most likely types of
control techniques to be used in metal furniture manufac-
turing plants in Illinois. The specific studies analyzed
were Air Pollution Control Engineering and Cost Study of
General Surface Coating Industry, Second Interim Report,
Springborn Laboratories, and informational literature
supplied by the metal furniture manufacturers.
8.1.4 Cost of Controlling VOC Emissions for Surface
Coating of Metal Furniture
The costs of control of volatile organic emissions
for surface coating of metal furniture were developed by:
Determining the alternative types of control
systems likely to be used
Estimating the probable use of each type of
control system
Defining equipment components
Developing installed capital costs for modifi-
cations of existing systems
Aggregating installed capital costs for each
alternative control system
Defining two model plants
Developing costs of a control system for the
model plants:
Installed capital cost
Direct operating cost
Annual capital charges
Energy requirements
Extrapolating model costs to individual industry
sectors
Aggregating costs to the total industry for the
state.
The model plants used as the bases for estimating the
costs of meeting RACT were solvent-based dipping and elec-
trostatic spraying operations. The cost of modifications
to handle waterborne or high solids was not considered to be
8-5
-------
a function of the type of metal furniture to be coated,
since no modifications to the production lines are
necessary. Modifications are required only to the coatings
handling and pumping and spraying equipment, and these
would not differ for different types of furniture pieces.
8.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements to implement RACT, assessing the
feasibility of instituting RACT controls in terms of capi-
tal availability and equipment availability, comparing the
direct costs of RACT control to various state economic
indicators and assessing the secondary effects on market
structure, employment and productivity as a result of
implementing RACT controls in Illinois.
8.1.6 Quality of Estimates
Several sources of information were utilized in
assessing the emissions, cost and economic impact of im-
plementing RACT controls on the surface coating of metal
furniture in Illinois. A rating scheme is presented in
this section to indicate the quality of the data available
for use in this study. A rating of "A" indicates hard
data (data that are published for the base year), "B"
indicates data that were extrapolated from hard data and
11C" indicates data that were not available in secondary
literature and were estimated based on interviews, analy-
sis of previous studies and best engineering judgment.
Exhibit 8-1, on the following page, rates each study
output listed and the overall quality of the data.
8-6
-------
EXHIBIT 8-1
U.S. Environmental Protection Agency
SURFACE COATING OF METAL FURNITURE DATA QUALITY
ABC
Extrapolated Estimated
Study Outputs Hard Data Data Data
Industry
statistics X
Emissions X
Cost of
emissions
control X
Economic impact X
Overall quality
of data X
Source: Booz, Allen & Hamilton.Inc.
-------
8.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business
trends for metal furniture manufacturing plants in
Illinois are presented in this section. Data in this
section form the basis for assessing the impact of im-
plementing RACT for control of VOC emissions from metal
furniture manufacturing plants in the state.
8.2.1 Industry Characteristics
Metal furniture is manufactured for both indoor and
outdoor use and may be divided into two general categor-
ies: office or business and institutional, and
household. Business and institutional furniture is
manufactured for use in hospitals, schools, athletic
stadiums, restaurants, laboratories and other types of
institutions, and government and private offices. House-
hold metal furniture is manufactured mostly for home and
general office use.
The household metal furniture manufacturing facili-
ties outnumber the office metal furniture manufacturing
facilities by a factor of two, but the individual
facilities of the latter are usually twice as large as
those of the former.
8.2.2 Size of the Industry
The Illinois EPA reports and Booz, Allen interviews
have identified 23 companies with 24 plants participating
in the manufacture and coating of metal furniture, as
shown in Exhibit 8-2, on the following page. These
companies accounted for an estimated $160 million in
household metal furniture shipments and $280 million in
business/institutional metal furniture shipments in 1977.
This is equivalent to about 13 percent and 12 percent of
the U.S. value of shipments of household and business/
institutional metal furniture, respectively. The esti-
mated number of employees in the entire metal furniture
industry in Illinois for 1977 was between 4,700 and 6,200.
8.2.3 Comparison of the Industry to the State Economy
A comparison of the value of shipments of metal
furniture with the state economy indicates that the metal
furniture industry represents about 0.4 percent of the
total Illinois value of shipments of all manufactured
8-7
-------
EXHIBIT 8-2
U.S. Environmental Protection Agency
LIST OF MANUFACTURERS POTENTIALLY AFFECTED
BY RACT GUIDELINES FOR SURFACE COATING OF
METAL FURNITURE IN ILLINOIS
Facility Name
All Steel Equipment, Inc.
Aurora Steel Products
Bentson Industries, Inc.
Century Display Mfg. Corporation
Clarin Corporation
Coach & Car Equipment Corporation
Douglas Furniture Corporation
Edsal Manufacturing
Filip Metal Cabinet Company
Howe11 Company
Illinois Range
Lyon Metal Products, Inc.
Marvel Metal Products Company
Monarch Metal Products Corporation
Newell Companies
Quaker Industries, Inc.
Reflector Hardware Company
St. Charles Mfg. Company
Speco Wire Company
Triangle Home Products, Inc.
Universal Bleacher Company
Western Manufacturing Company
Zenith Radio Corporation
Location
Montgomery
Aurora
Aurora
Franklin Park
Lake Bluff
Elk Grove
Bedford Park
Chicago
Chicago
St. Charles
Mt. Prospect
Montgomery
Chicago
Elk Grove
Freeport
Antioch
Melrose Park
St. Charles
Chicago
Chicago
Champaign
Aurora
Aurora
Source; Illinois EPA Memorandum of June 8, 1978, and
Booz, Allen and Hamilton Inc. interviews.
-------
goods. The industry employs between 0.4 percent and 0.5
percent of all people employed in manufacturing in
Illinois.
8-8
-------
8.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents information on metal furniture
manufacturing operation, estimated VOC emissions, the
extent of current control and the likely alternatives
which may be used for controlling VOC emissions in
Illinois.
8.3.1 Metal Furniture Manufacturing and Coating
Operation
Manufacturing of metal furniture consists of the
following steps: fabrication of furniture parts, coating
and final assembly. Coating operations usually include
surface preparation, coating and curing.
The surface preparation typically consists of
cleansing, pretreating, hot and/or cold rinse and drying.
Depending on individual facilities, these steps may be
eliminated by substituting an organic solvent cleaning
operation or cleaning pieces in a shot-blast chamber. A
few facilities in Illinois do not require surface prepa-
ration because of special fabricating methods and paint
formulation.
Most metal furniture is finished with a single coat
applied by spraying, dipping and flow coating. The
latter two techniques are generally used when manufac-
turers only use one or two colors. Spraying is used
when a variety of colors are offered and is accomplished
by electrostatic spraying or by the conventional airless
or air spray methods. If the product requires two coats,
a primecoat is applied by one of the same methods used
for the topcoat or single coat.
Most painted furniture or furniture pieces are baked
in an oven; however, in some cases they are air dried.
After the coating application and before baking, the
solvent in the coating film is allowed to rise slowly in
a flash-off area to avoid popping of the film during
baking. The common steps in the coating operations are
illustrated in Exhibit 8-3, on the following page.
Most of the coatings applied to metal furniture are
enamel, although some lacquers and metallic coatings are
also used. Coating thickness generally varies from 0.7
to 1.5 mils.
8-9
-------
Exhibit 8-3
U.S. Environmental Protection Agency
COMMON TECHNIQUES USED IN COATING OF METAL
FURNITURE PIECES
ELECTROSTATIC. OR
CONVENTIONAL AIR OR
AIRLESS STRAY COATING
TO FINAL
ASSEMBLY
PRIME COAT. FLASHOFF AREA
AND OVEN
(OPTIONAL)
FROM
MACHINE SHOP
CLEANSING AND
PRETMEATMENT
FLOW COATING
TOPCOAT OR SINGLE
COAT APPLICATION
Source: U.S. Environmental Protection Agency
-------
8.3.2 Emissions and Current Controls
This section presents the estimated VOC emissions
from metal furniture manufacturing facilities in Illinois
in 1977 and the current level of emission controls imple-
mented in the state. Exhibit 8-4, on the following page,
shows the total emissions from the 24 metal furniture
manufacturing facilities to be about 1,606 tons per year.
These data were obtained from Illinois EPA Memorandum of
June 1978, and were obtained from Illinois EPA Memorandum of
several manufacturers. Except for Aurora Steel Products
and Howell Company, none of the manufacturers have imple-
mented complete hydrocarbon emissions controls systems.
Aurora Steel Products and Howell recently converted their
existing coating lines to water-based coating and powder
coating, respectively. Some of the other manufacturers
have been experimenting with alternative control systems,
but are not yet ready to install a complete system.
8.3.3 RACT Guidelines and Control Options
The emission limitations that can be achieved through
the application of Reasonably Available Control Technology
(RACT) for the metal furniture coating industry are
present in Exhibit 8-5, on the following pages. This
emission limit is based on the use of low organic solvent
coatings. It can also be achieved with waterborne coat-
ings and is approximately equivalent (on the basis of
solids applied) to the use of an add-on control device
that collects or destroys about 80 percent of the solvent
from a conventional high organic solvent coating. In some
cases, greater reductions (up to 90 percent) can be
achieved by installing new equipment which uses powder or
electrodeposited waterborne coatings. A comparison of the
various control options is presented in Exhibit 8-6,
following Exhibit 8-5.
8.3.4 Selection of the Most Likely RACT Alternatives
The choice of application of control alternatives,
for the reduction of hydrocarbon emissions in existing
facilities for the surface coating of metal furniture,
requires a line-by-line evaluation. A number of factors
must be considered, based on the individual characteristics
of the coating line to be controlled. The degree of
economic dislocation is a function of these factors.
The first factor to be considered is whether the
existing equipment can be used by the substitution of a
8-10
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EXHIBIT 8-4
U.S. Environmental Protection Agency
SUMMARY OF HYDROCARBON EMISSIONS FROM METAL FURNITURE
MANUFACTURING FACILITIES IN ILLINOIS
I.D. Number
019 010 ACD
031 012 AAT
031 096 ACC
031 186 ABI
031 198 AAR
031 440 AAQ
031 440 AFF
031 600 BPK
031 600 BQO
031 600 CEI
031 600
031 600
031 600
089 005
089 005
089 005
089 005
089 005
089 055
089 483
089 483
097 005
097 075
177 020
DKM
DOY
EDF
AAN
AAR
ABE
AGI
AAF
AAQ
ABF
ABI
AAB
AAP
AAM
Facility Name
Universal Bleacher Company
Douglas Furniture Corp.
Century Display Mfg.
Reflector Hardware Company
Illinois Range
Coach & Car Equipment
Corporation
Monarch Metal Products
Corporation
Edsal Manufacturing
Zenith Radio Corporation
Triangle Home Products
Inc.
Filip Metal Cabinet Co.
Speco Wire Company
Marvel Metal Products Co.
Aurora Steel Products
Bentson Industries, Inc.
Lyon Metal Products, Inc.
Western Manufacturing Co.
Lyon Metal Products, Inc.
All-Steel Equipment Co.
Howe11 Company
St. Charles Mfg. Company
Quaker Industries, Inc.
Clarin Corporation
Newell Companies
Total
No. of
Sources
4
4
7
3
1
1
Current Average
Hydrocarbon
Emissions
(Tons/Year)
49
26
Negligible
20
Negligible
Negligible
21
7
1
1
4
3
5
6
2
5
2
23
27
6
8
5
6
2
102
23
9
44
Negligible
72
Negligible
3
25
8
450
600
Negligible
118
Negligible
17
19
1,606
a. These are uncontrolled emissions.
Source: Illinois EPA Memorandum of June 1978, and Booz,
Allen and Hamilton Inc. Interviews.
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EXHIBIT 8-5
U.S. Environmental Protection Agency
EMISSION LIMITATIONS FOR RACT IN SURFACE
COATING OF METAL FURNITURE
Recommended Limitation
Affected Facility
Metal furniture coating line
kg of organic solvent
emitted per liter of
coating (minus water)
0.36
Ibs. of organic solvent
emitted per gallon of
coating (minus water)
3.0
Source: Environmental Protection Agency.
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EXHIBIT 8-6(1)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE METAL FURNITURE INDUSTRY
Control Options
Waterborne
(electrodeposition,
EDP)
Affected Facility
and Application
Primecoat or
single coat
Typical Percent
Reduction
90-953
Comparison of Control Options
Provides excellent coverage
corrosion protection and
resistance
Fire hazards and potential
toxicity are reduced
Dry off oven may be omitted
after cleansing if an iron-
phosphate pretreatment is
used
Waterborne (spray dip
or flow coat)
All applications
60-90
Good quality control due to
fully automated process may
be offset by increased
electrical requirements for
the coating, refrigeration
and circulation systems if
EDP replaces waterborne
flow or dip coating opera-
tions. This would not be
true if EDP replaces a
spraying operation
EDP can be expensive on small-
scale production lines
This will likely be the first
option considered because of
the possibility that these
coatings can be applied
essentially with existing
equipment
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EXHIBIT 8-6(2)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE METAL FURNITURE INDUSTRY
Control Options
Waterborne (spray dip
or flow coat)
(continued)
Affected Facility
and Application
Typical Percent
Reduction
Comparison of Control Options
Requires a longer flash-off
area than organic solvent-
borne coatings
Curing waterborne coatings
may allow a decrease in
oven temperature and some
reduction in airflow, but
limited reduction if high
humidity conditions occur
Spraying electrostatically
requires electrical isola-
tion of the entire system.
Large lines may be difficult
to convert because coating
storage areas may be
hundreds or thousands of
feet away from the
application area
Dip or flow coating applica-
tion requires closer
monitoring due to its
sensitive chemistry
Weather conditions affect the
application, so flash-off
time, temperature, air
circulation and humidity
must be frequently monitored
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EXHIBIT 8-6(3)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE METAL FURNITURE INDUSTRY
Control Options
Waterborne (spray dip
or flow coat)
(continued)
Powder (spray or dip)
Affected Facility
and Application
Typical Percent
Reduction
Top or single coat
95-99
Comparison of Control Options
Changes in the number of nozzles
may be required
Sludge handling may be more
difficult
No solid or liquid wastes to
dispose of
Powder may reduce energy
requirements in a spray booth
and the ovens because less
air is required than for
solvent-borne coatings and
flash-off tunnel is
eliminated
Powder can be reclaimed, result-
ing in up to 98% coating
efficiency
All equipment (spray booths,
associated equipment and
often ovens) used for liquid
systems must be replaced
Powder films cannot be applied
in thicknesses of less than
2 mils and have appearance
limitations
Powder coatings may be subject
to explosions
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EXHIBIT 8-6(4)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE METAL FURNITURE INDUSTRY
Control Options
Powder (spray or
dip)(continued)
Affected Facility
and Application
Typical Percent
Reduction
High solids (spray)
Top or single coat
50-80
Carbon adsorption
Prime, single or
top coat
(application
and flash-off
areas)
90
Comparison of Control Options
Excessive downtime (half-hour)
is required during color
changes. If powders are not
reclaimed in their
respective colors, coating
usage efficiency drops to
50% to 60%
May be applied with existing
equipment
Reduces energy consumption
because it requires less
airflow in the spray booth,
oven and flash-off tunnel
Potential health hazard asso-
ciated with isocyanates used
in some high-solid two-
component systems
Although it is technically
feasible, no metal
furniture facilities are
known to use carbon
adsorption
Additional energy requirements
is a possible disadvantage
Additional filtration and
scrubbing of emissions from
spray .booths may be
required
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EXHIBIT 8-6(5))
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE METAL FURNITURE INDUSTRY
Control Options
Carbon adsorption
(continued)
Affected Facility
and Application
Typical Percent
Reduction
Comparison of Control Options
There is little possibility
of reusing recovered solvents
because of the variety of
solvent mixtures
Many facilities may require
dual-bed units which require
valuable plant space
Particulate and condensible
matter from volatilization
and/or degradation of resin,
occurring in baking ovens
with high temperature, could
coat a carbon bed
Incineration
Prime, single or
topcoat (ovens)
90
These are less costly and more
efficient than carbon
adsorbers for the baking
ovens because the oven
exhaust temperatures are too
high for adsorption and the
high concentration of organics
in the vapor could provide
additional fuel for the
incinerator
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EXHIBIT 8-6(6)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE METAL FURNITURE INDUSTRY
Affected Facility Typical Percent
Control Options and Application Reduction Comparison of Control Options
Incineration Heat recovery system to reduce
(continued) fuel consumption would be
desirable and would make
application and flash-off
area usage a viable option
a. The base case against which these percent reductions were calculated is a high organic
solvent coating which contains 25 volume percent solids and 75 percent organic solvent.
The transfer efficiencies for liquid coatings were assumed to be 80 percent for spray, 90
percent for dip or flow coat, 93 percent for powders and 99 percent for electrodeposition.
b. This percent reduction in VOC emissions is only across the control device and does not take
into account the capture efficiency.
Source; Control of Volatile Organic Emissions from Stationary Sources—Volume III; Surface Coating
of Metal Furniture, EPA-450/2-77-032, December 1977.
-------
coating material which will meet the RACT guideline.
This alternative would require the least capital expen-
diture and may minimize production downtime.
If the existing equipment has to be modified,
replaced or expanded, factors to consider are the kind
of changes that have to be made, the capital costs, the
change in operating costs, the length of time needed to
make the changes, the effect on the production rate, the
operational problems that will have to be handled and
the effect on the quality of the product.
Interviews with industry representatives indicate
that most manufacturers will use their existing spraying
equipment and modify it to handle high solids or water-
borne coatings. The existing dipping or flow coating
equipment will be modified to handle waterborne coating.
One manufacturer reportedly has to modify an existing dip
coating equipment to electrodeposition to meet the RACT
guidelines.
8-11
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8.4 COST AND VOC REDUCTION BENEFIT EVALUATIONS FOR THE
MOST LIKELY RACT ALTERNATIVES
This section presents the cost for the most likely
control systems and associated VOC reduction benefit.
First the costs for the two types of model plants are
presented, which are then extrapolated to the statewide
industry. For one plant in the state, the costs were
obtained directly from the manufacturer.
8.4.1 Model Plant Costs and VOC Reduction Benefits
Two types of model plants, each with different
sizes, were selected for the surface coating of metal
furniture. The first type included an electrostatic
spraying line with outputs of 3 million square feet and
48 million square feet of surface area coated per year.
The second type included a dip coating line with outputs
of 7 million square feet and 22.5 million square feet of
surface area coated per year. Assuming a one-color
single-coating line, the capital, operation and mainte-
nance costs for the model plant were estimated. The cost
of pretreatment facilities, ovens and plant building was
excluded from total capital costs. The annualized cost
includes coating materials, utilities, operation and
maintenance labor, maintenance material and capital
charges (depreciation, interest, taxes, insurance and
administrative charges). General plant overhead cost was
excluded from the annualized cost. The estimated costs
for the model base plant and the incremental costs for
the most likely control options are presented in Exhibit
8-7 for the electrostatic spraying and in Exhibit 8-8 for
dip coating lines, on the following pages.
The assumptions for the cost estimates are discussed
in the RACT guidelines document (EPA-450/2-77-032). It
should be noted that the incremental costs, or savings
can change significantly if the underlying assumptions
are changed. For example, if the base plant assumption
of 25 percent solids coating was 30 percent solids coat-
ing, no savings for conversion to higher solids (70 per-
cent) would result. Similarly, capital costs for
conversion to waterborne coating would increase
dramatically, if significant changes to the facility were
needed, compared to the assumption of cleaning and
corrosion protection only of existing dip tanks.
8-12
-------
Installed capital cost ($000)
Direct operating costs (savings)
($000)
Capital charges ($000/yr)
Net annualized cost (credit)
($000/yr)
Solvent emissions controlled
(tons/yr)
Percent emissions reduction
Annualized cost (credit) per ton
of VOC controlled ($/ton)
Exhibit 8-7
U.S. Environmental Protection Agency
ESTIMATED COST OF CONTROL FOR MODEL
EXISTING ELECTROSTATIC SPRAY COATING LINES
Model Plant A-l
(3 Million Square Feet/Yr)
Model Plant A-2
(48 Million Square Feet/Yr)
Base
Plant
Cost
25% Higher
Incremental Costs for
Conversion
Base
Plant
Cost
25%
Incremental Costs for
Conversion
Higher
Solids Solids Waterborne Powder Solids Solids Waterborne Powder
255
175
48
223
N/A
15
(6)
3
(3)
21
N/A 86
N/A (143)
15
5
3
8
20
80
400
60 1,200
17 1,113
62
(81)
11 224 12
28 1,337 (69)
24 N/A 336
97 N/A 86
1,167 N/A (205)
62
50
12
62
314
317
343
59
402
380
80 97
197 1,076
Note: 1977 dollars and short tons
Source: Control of Volatile Organic Emissions from Existing Stationary Sources, Volume III; Surface
Coating of Metal Furniture, EPA-450/2-77-032, December 1977.
-------
Installed capital cost ($000)
Direct operating costs
($000)
Capital charges ($000/yr)
Net annualized cost ($000/yr)
Solvent emissions controlled
(tons/yr)
Percent emissions reduction
Annualized cost per ton of
VOC controlled ($/ton)
Exhibit 8-8
U.S. i.nvironmental Protection Agency
ESTIMATED COST OF CONTROL OPTIONS FOR
MODEL EXISTING DIP COATING LINES
Model Plant B-l Model Plant B-2
(7 Million Square Feet/Yr) (22.5 Million Square Feet/Yr)
Base
Plant
Cost
25%
Solids
105
135
20
155
N/A
N/A
N/A
Incremental Costs
for Conversion to
Waterborne
3
10
1
11
27
80
407
Base
Plant
Cost
25%
Solids
215
450
40
490
N/A
N/A
N/A
Incremental Costs
for Conversion to
Waterborne
5
17
1
18
122
80
148
Note: 1977 dollars and short tons
Source: Control of Volatile Organic Emissions from Existing Stationary Sources,
Volume III; Surface Coating of Metal Furniture, EPA-50/2-77-032,
December 1977
-------
8.4.2 Extrapolation of Control Costs to the
Statewide Industry
Exhibit 8-9, on the following page, presents the
extrapolated costs for meeting RACT guidelines for VOC
emission control for surface coating of metal furniture
to the statewide industry in Illinois. The estimates
were derived based on the following:
The 17 plants listed in Exhibit 8-4 that emit
measurable quantity of hydrocarbons would
require controls to comply with the RACT
guidelines.
The distribution of control options was based
on industry interviews, as well as Booz, Allen
estimates. In general, existing spray coating
lines are likely to convert to high solids
where high quality finish is required and to
waterborne where less emphasis is placed on
appearance.
The capital cost of control for high solids
spray, waterborne spray and waterborne dip
coating was estimated by scaling up the model
plants A-l and B-l costs by a capacity factor
calculated as follows. The capacity factor
was estimated to be one for the coating lines
with emissions per line equal to or less than
those of the model plants. For the coating
lines with greater emissions per line than
those of the model plant, the capacity factor
per line was determined to be equal to:
(actual emissions/model plant emissions) '
The capital cost for the EDP conversion was
obtained from Lyon Metal Products, Inc.,
which must replace its existing dip coating
operations with completely new equipment
and remodel the plant. The annual capital
charges were estimated to be 18.7 percent of
the capital cost not including maintenance costs.
Based on the data from the U.S. EPA, the incre-
mental annual operating cost for high solids
spray, waterborne spray and waterborne dip
coating was determined to be proportional to
the amount of emissions reduction and was scaled
up from the model plant costs. For the EDP
conversion, the cost was obtained from Lyon
Metal Products.
8-13
-------
Exhibit 8-9
U.S. Environmental Protection Agency
STATEWIDE COSTS FOR PROCESS MODIFICATIONS OF
EXISTING METAL FURNITURE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION CONTROL
Projected Control Option
Characteristic
High
Number of plantsa
Number of process lines
Uncontrolled emissions (ton/yr)
Potential emission reduction (ton/yr)
Installed capital cost ($000)°
Direct annual operating cost (credit)
($000) (1-3 shifts /day)0
Annual capital charges (credit)
($000)
Net annualized cost (credit) ($000)
Annualized cost (credit) per ton of
emission reduced ($)
Solids
Spray
8
15
835
718
357
(219)
67
(152)
(65)
Waterborne
Spray
8
8
203
162
140
42
26
68
475
EDP
1
3
340
313
3,500
1,019
655
1,674
5,348
Waterborne
Dip
3
5
228
182
10
67
2
69
518
'Total
17
31
1,606
1,375
4,007
909
750
1,659
1,206
a. Total number of plants is less than the sum of individual columns because some
plants have both spraying and dipping lines.
b. Based on control efficiency of 86 percent for high solids, 80 percent for waterborne,
92 percent for EDP, and 97 percent for powder coating.
c. Based on cost for model plant A-l and B-l from Exhibits 8-7 and 8-8, and from data
provided by Lyon Metal Products for EDP.
d. 18.7 percent of capital cost.
Source: Booz, Allen fi Hamilton Inc.
-------
The data in Exhibit 8-9 show that the control of
VOC for surface coating of metal furniture to meet the
RACT guidelines in Illinois would require a statewide
capital investment of abrmt $4 million and an annualized
cost of about $1.6 million. The bulk of these costs
are expected to be borne by one plant in the state.
8-14
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8.5 DIRECT ECONOMIC IMPACTS
This section presents the direct economic impacts
of implementing the RACT guidelines for surface coating
of metal furniture, on a statewide basis. The analysis
includes the availability of equipment and capital;
feasibility of the control technology; and impact on
economic indicators, such as value of shipments, unit
price (assuming full cost passthrough), state economic
variables and capital investment.
8.5.1 RACT Timing
RACT must be implemented statewide by January 1,
1982. This implies that surface coaters of metal furni-
ture must have made their process modifications and be
operating within the next three years. The timing
requirements of RACT impose several requirements on metal
furniture coaters:
Determine the appropriate emission control
system.
Raise or allocate capital to purchase new
equipment or modify existing facilities.
Acquire the necessary equipment or coating
material for emission control.
Install new equipment or modify existing
facilities and test equipment and/or new
materials to ensure that the system com-
plies with RACT and provides acceptable
coating quality.
Generate sufficient income from current
operations to pay the additional annual
operating costs incurred with emission
control.
The sections which follow discuss the feasibility
and the economic implications of implementing RACT
within the requirement timeframe.
8.5.2 Feasibility Issues
Technical and economic feasibility issues of
implementing the RACT guidelines are discussed in this
section.
8-15
-------
Several metal furniture manufacturers interviewed
during this study have attempted to implement the con-
trol systems discussed in this report. One has already
converted the entire facility to waterborne electrostatic
spray and dip coating during plant modernization, whereas
another has converted to powder coating. Because these
manufacturers use a limited number of colors, they have
been able to successfully convert their existing opera-
tions to waterborne or powder coating. Others interviewed
use a variety of colors, some as many as 1,500, and have
experimented with high solids and waterborne coatings,
but have not succeeded in obtaining the desired quality
paint formulations in the variety of colors needed from
the suppliers. One manufacturer employs a unique fabri-
cation process and paint formulation that allow him to
dip coat his products without pretreatment. Unless a
compatible coating formulation is made available, this
manufacturer may have to incur substantial capital and
operating costs to completely modify his existing opera-
tions to comply with the RACT guidelines. The development
of suitable coating materials in a variety of colors is
the key to successful implementation of RACT in the
required time.
Unless major modifications are required, such as
complete isolation of large coating facilities to convert
to electrostatically sprayed waterborne coating, the cost
of conversion to high solids or waterborne coatings is
not likely to have a significant effect on the implemen-
tation of the RACT guidelines for surface coating of
metal furniture.
8.5.3 Comparison of Direct Cost With Selected Direct
Economic Indicators
The net increase in the annualized cost to the
coaters of metal furniture represents approximately 0.4
percent of the industry's 1977 value of shipments manu-
factured in the state. This increase may translate to
a few cents per unit of furniture manufactured to more
than $1 per unit manufactured, depending on the furniture
surface area coated.
The cost of control to meet the RACT guidelines in
the required time will have a severe economic impact on
one company in the state — Lyon Metal Products, Inc.,
which contributes about 30 percent of the VOC emissions
from surface coating of metal furniture in Illinois, must
incur more than three times its normal annual capital
8-16
-------
expenditure and significant annualized cost to com-
ply with the RACT guidelines. This is estimated to
be equivalent to the company's profit for two years
and would raise the production costs.
The major economic impact in terms of cost to the
other companies will be capital related rather than from
increased annualized costs. The capital required
for RACT compliance may present a signiticant capital
appropriation problem for the companies affected, only
if significant facilities modifications were required.
In general, marginally profitable companies may be
more severely affected, although none of the companies
interviewed had considered going out of business because
—of the projected increased capital requirements.
8-17
-------
8.6 SELECTED SECONDARY ECONOMIC IMPACTS
This section discusses the secondary impact of
implementing RACT on employment, market structure and
productivity.
Employment is expected to remain unchanged. Employ-
ment would be reduced if marginally profitable facilities
closed, but the present indication from the industry is
that no such closures are anticipated.
It appears that implementation of the RACT guide-
lines may temporarily weaken the market position of one
large company in the state, but the overall impact on the
market structure is not expected to be significant.
Productivity for those coaters who would be coating
only with high solids could be increased, because they
will be able to get more paint on per unit volume
and reduce paint application time.
8-18
-------
EXHIBIT 8-10
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING OF METAL
FURNITURE IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Discussion
There are 23 metal furniture manufacturing
companies with 24 facilities
1977 statewide value of shipments was $440
million
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC
control
Assumed method of VOC control to
meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Trend is towards the use of a variety of
colors
1,606 tons per year
Low solvent coatings
Low solvent coatings
Discussion
$4 million
$1.6 million (approximately 0.4 percent of
current value of shipments)
Varies from a few cents to more than $1 per
unit of furniture depending upon surface area
coated (assuming a "full-cost passthrough")
No major impact
No major impact
No major impact
No major impact on overall structure. However,
one company is expected to bear disproportionate
costs.
Companies using a variety of colors may face
a problem
Low solvent coating in a variety of colors
providing acceptable quality needs to be
developed
231 tons per year (15 percent of current
emissions level)
$1,206 annualized cost/annual ton of VOC
reduction
Source: Booz, Allen & Hamilton, Inc.
-------
BIBLIOGRAPHY
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Stationary Sources, Volume III;
Surface Coating of Metal Furniture. EPA-450/2-77-032,
December 1977.
U.S. Department of Commerce, County Business Patterns,
1976.
U.S. Department of Commerce, Census of Manufactures, 1977.
Springborn Laboratories, Air Pollution Control Engineering
and Cost Study of General Surface Coating Industry, Second
Interim Report, Enfield, CT, August 23, 1977.
Private conversations with:
Universal Bleacher, Champaign, Illinois
St. Charles Mfg. Co., St. Charles, Illinois
Triangle Home Products, Chicago, Illinois
Quaker Industries, Antioch, Illinois
Clarin Corp., Lake Bluff, Illinois
Aurora Steel Products, Aurora, Illinois
Howell Co., St. Charles, Illinois
St. Charles Mfg. Co., St. Charles, Illinois
Lyon Metal Prod., Montgomery, Illinois
All Steel Equip. Inc., Montgomery, Illinois
-------
9.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE COATING
FOR INSULATION OF MAGNET WIRE IN
THE STATE OF ILLINOIS
-------
-------
9.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE COATING
FOR INSULATION OF MAGNET WIRE IN
THE STATE OF ILLINOIS
The State of Illinois EPA has identified five facilities
that surface coat magnet wire for insulation. The information
from the emission inventory indicates that all these facilities
have implemented controls that conform to the RACT guidelines
as acceptable control alternatives.
Exhibit 9-1, on the following page, lists the data from
the State of Illinois emission inventory on the magnet wire
coaters. Exhibits 9-2, 9-3 and 9-4, following Exhibit 9-1,
summarize the emission limitations and control options for
surface coating for insulation of magnet wire.
Based on the following, there will be no economic
impact in Illinois for implementing RACT in the industry
category of surface coating for insulation of magnet wire:
All magnet wire coaters have been identified
by the Illinois EPA.
The controls shown on the Illinois EPA emission
inventory have been implemented by these facili-
ties.
The controls are expected to meet the RACT
guidelines.
Exhibit 9-5, following 9-4, presents a summary of the
current economic implications of implementing the RACT guide-
lines for the surface coating for insulation of magnet wire
in Illinois.
9-1
-------
EXHIBIT 9-1
U.S. ENVIRONMENTAL PROTECTION AGENCY
MAGNET WIRE COATERS IN THE STATE OF ILLINOIS
Facility
Chicago Magnet Wire Corp.
Ananconda Wire and Cable
Liberty Copper and Wire Co.
Horning Wire Corp.
Essex International Corp.
TOTAL
Type of Control
EXT. Thermal
Incinerator
Catalytic After-
burner
Catalytic and
Thermal Incin-
erators
Thermal Afterburner
Afterburners
Current
Hydrocarbon
Emission
(tons/yr.)
11
1
25_
51
Average Control
Efficiency
(percent)
98.5
90.0
85
99
97.5-99.5
88.5 (avg.)
Potential Emission
Reduction through
PACT
(tons/yr.)
0
0
Source; Illinois EPA report, June 9, 1978
-------
EXHIBIT 9-2
U.S. Environmental Protection Agency
EMISSION LIMITATIONS FOR RACT IN THE
SURFACE COATING FOR INSULATION OF MAGNET WIRE
Recommended Limitations For
Low Solvent Coatings
kg solvent per liter Ibs. solvent per gallon
Affected of coating of coating
Facility (minus water) (minus water)
Wire coating oven 0.20 1.7
Source t Control of Volatile Organic Emissions from Stationary
Source—Volume IV; Surface Coating for Insulation of
Magnetic Wire, EPA-450/2-77-033, December 1977.
-------
EXHIBIT 9-3
U.S. Environmental Protection Agency
SUMMARY OF APPLICABLE CONTROL TECHNOLOGY
FOR CONTROL OF ORGANIC EMISSION FROM THE
SURFACE COATING FOR INSULATION
OF MAGNET WIRE
CARBON ADSORPTION
MAGNET WIRE COATING
EMISSION CONTROL
OPTIONS
LOW SOLVENT
COATINGS
WATERBORNE
HOT MELT(l)
^^^_^w
ULTRAVIOLET CURED(2)
XELECTRO DEPOSITION(3)
POWDER COATINGS
(EPOXY)
\
\INCINERATION
INTERNAL CATALYTIC
EXTERNAL CATALYTIC
INTERNAL THERMAL
XTERNAL THERMAL
Notes: (1) Has been used successfully in Europe.
(2) Available for specialized applications.
(3) Theoretically possible, but not commercially developed.
Source: Control of Volatile Organic Emissions from Existing Stationary
Sources—Volume IV; Surface Coating for Insulation of Magnet
Wire, EPA-450/2-77-033, December 1977.
-------
EXHIBIT 9-4(1)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE SURFACE
COATING FOR INSULATION OF MAGNET WIRE
Affected Facility
Magnet wire coating ovens
Control Options
Incineration
Catalytic, internal
Typical Percent
Reduction
75-95
Catalytic, external
75-95
Thermal, internal
Thermal, external
Low solvent coating
Waterborne coating
Powder coating
98
98
80
Comparison of Control Options
All major wire oven designers now incorporate
internal catalysts into their design. This
design recirculates clean, heated air into
the wire drying zone. However, this option
will not be considered part of this study
since it is not a retrofit option.
An add-on option, this is energy intensive and
is not easily adapted to primary heat
recovery. Catalytic devices cannot be imple-
mented where polyester amide-imide coatings
are used, since they act as catalyst poison.
Experimental catalysts are being developed
to overcome this problem.
Hot, clean gases can be recirculated back to
the drying zone but this type of incinerator
has not been popular with wire coaters
because it is a high energy user.
This option is readily adaptable to both pri-
mary and secondary heat recovery.
This option has not been developed with the
properties that meet all wire coating needs.
Presently being used in small quantities,
these are not available with properties suit-
able for all wire coating applications and
don't have good high-temperature resistance.
Applied to wire on an experimental basis. The
upper temperature range of 130°C for epoxy
powder coating is well below the 220°C
operating temperature at which many types of
electrical equipment must operate. Powder
can be used only on large diameter wires.
For finer wire, the powder particle approaches
the wire diameter and will not adhere well
to the wire.
-------
EXHIBIT 9-4(2)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE SURFACE
COATING FOR INSULATION OF MAGNET WIRE
Typical Percent
Affected Facility Control Options Reduction Comparison of Control Options
Hot melt coating a This has been reported successful in Europe.
Ultraviolet cured coatings a This is available for specialized systems.
Electrodeposition coatings a This is theoretically possible; but once a
layer of coating is applied by the wire,
the surface is insulated against further
electrodeposition.
a.Not available
nf Volatile Oraanic Emissions from Existing ..
150/2-77-003, December 1977
Source: Control of Volatile Organic Emissions from Existing Stationary Sources—Volume IV:
Surface Coating for Insulation of Magnet Wire EPA-45' = *•=-=
-------
EXHIBIT 9-5
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING FOR INSULATION
OF MAGNET WIRE IN THE STATE OF ILLINOIS
Current Situation
Number of potentially -affected
facilities
Indication of relative importance
of industrial section to state
economy
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control to
Discussion
There are five facilities that coat magnet wire and
meet the RACT emission limitations
1977 statewide value of shipments was esti-
mated at $66 million and represents 8 percent of
the estimated $630 million value of shipments
of the magnet wire industry nationwide
51 tons per year
Waterborne coating or add on catalytic incinera-
tor with primary heat recovery
Waterborne coatings (where applicable) or add on
catalytic incinerator with primary heat recovery
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emissions after RACT control
Cost effectiveness of RACT control
Discussion
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
No major impact
51 tons per year
No major impact
Source: Booz, Allen & Hamilton Inc.
-------
-------
10.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF
ILLINOIS
-------
-------
10.0 THE ECONOMIC IMPACT OF
IMPLEMENTING -RACT GUIDELINES
FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF
ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT for surface coating of large appliances
in the State of Illinois. The chapter is divided into six
sections including:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Emissions and current controls
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of the
application of surface coatings on large appliances, inter-
views and analysis.
10-1
-------
10.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impacts
for the surface coating of large appliances in Illinois.
An overall assessment of the quality of the estimates
is detailed in the latter part of this section.
10.1.1 Industry Statistics
The major appliance industry contains six major indus-
trial areas as defined by the Standard Industrial Code (SIC).
SIC Code Description
3582 Commercial laundry
3585 Commercial refrigeration and air
conditioning
3589 Commercial cooking and dishwashing
3631 Household cooking
3632 Household refrigerator and freezer
3633 Household laundry
3639 Household appliances, N.E.C.
(includes water heaters,
dishwashers, trash compactors)
Current Industrial Report provides detailed industry
statistical data for the ma^or appliance industry on a national
basis. However, because of confidentiality and disclosure
problems, there is no individual data source which provides
a comprehensive analysis of the statistical data for each
individual state. Therefore, our methodology to provide
statewide major appliance statistical data was as follows:
A list of potentially affected facili-
ties was compiled from the state emission
inventory, associations and trade journals.
10-2
-------
Interviews were performed with some of
the manufacturers to validate the list
of potentially affected facilities (this
list was not 100 percent validated).
Secondary source data were collected for each
of the industry categories from sources such
as:
Sales and Marketing Management
(April 25, 1978)
1972 Census of Manufactures.
The Booz, Allen study team, utilizing all
available inputs, including interviews with
selected manufacturers, determined an esti-
mated percent of the total U.S. value of
shipments applicable to the state in each
SIC category.
For those categories which included products not included
in this study, the value of shipments of these items were
factored out of the totals.
Data on number of units shipped were not available for
commercial appliances, so economic impact based on unit
costs for the total large appliance industry could not be
calculated.
10.1.2 VOC Emissions
The Illinois EPA conducted a survey to determine the VOC
emissions for the coating of large appliances since no data
were available in the state's emissions inventory. Emissions
were determined for four companies with eight manufacturing and
coating facilities identified as major emitters in this cate-
gory. The emission data provided by the Illinois EPA survey
are used as the basis for current VOC emissions in this
report.
10.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emission for the surface
coating of large appliances are described in Control of Volatile
Organic Emissions from Existing Stationary Sources—Volume V;
Surface Coating of Large Appliances, (EPA-450/2-77-034,
December 1977). Several manufacturers of large appliances and
coating application equipment were interviewed to ascertain the
most feasible types of control for organic emissions in the
coating of large appliances.
10-3
-------
All manufacturers interviewed agreed that, currently,
consideration was being given to meeting the present RACT dead-
lines through one modification to the existing topcoating
equipment (i.e., high solids) and through two possible alter-
natives to primecoating operations (i.e., waterborne dip
or flow coat or high solids), depending on the type of
existing equipment. Therefore, the analysis for this report
was based on these alternatives. The methodology for the
cost analysis is described in the following paragraphs.
10.1.4 Cost of Control of VOC Emissions for Surface
Coating of Large Appliances
The costs of control of volatile organic emissions for
surface coating of large appliances were developed by:
Determining the alternative types of control
systems likely to be used
Estimating the probable use of each type of control
system
Defining system components
Developing installed capital costs for modifi-
cations of existing systems
Aggregating installed capital costs for each
alternative control system
Defining a model plant
Developing costs of a control system for the
model plant:
Installed capital cost
Direct operating cost
Annual capital charges
Energy requirements
Extrapolating model costs to individual industry
sectors
Aggregating costs to the total industry for the
state.
10-4
-------
The model plant that was used as a basis for establishing
the cost of process modification to meet RACT was a solvent-
based dip (or flow coat) primecoat and a solvent-based electro-
static bell or disc topcoat. The cost of modification to water-
borne dip or flow coat primecoat and to high solids electrostatic
disc or bell topcoat was not considered to be a function of the
type of major appliance to be coated, since no modifications to
the production lines are necessary. Modifications are required
only to the coatings handling and pumping and spraying equipment,
and these would be approximately the same whether washers, dryers
or refrigerators were being coated.
Since industry interviewees indicated that about half
the household appliance industry primecoats before topcoating
and half does not, the costs of control for the industry
will reflect the additional cost that half the industry must
incur in having to convert both phases of its coating operation
to meet RACT guidelines.
10.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements to implement RACT/ assessing the
feasibility of instituting RACT controls in terms of capital
availability and equipment availability, comparing the direct
costs of RACT control to various state economic indicators and
assessing the secondary effects on market structure, employment
and productivity as a result of implementing RACT controls in
Illinois.
10.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls on the surface coating of large appliances in Illinois.
A rating scheme is presented in this section to indicate the
quality of the data available for use in this study. A rating
of "A" indicates hard data, (data that are published for the
base year), "B" indicates data that were extrapolated from hard
data and "C" indicates data that were not available in secondary
literature and were estimated based on interviews, analysis of
previous studies and best engineering judgment. Exhibit 10-1,
on the following page, rates each study output listed and the
overall quality of the data.
10-5
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EXHIBIT 10-1
U.S. Environmental Protection Agency
SURFACE COATING OF LARGE APPLIANCES
DATA QUALITY
Study Outputs
Hard Data
B
Extrapolated
Data
Estimated
Data
Industry statistics
X
Emissions
X
Cost of emissions control
Economic impact
Overall quality of data
Source: Booz, Allen & Hamilton Inc.
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10.2 INDUSTRY STATISTICS
Industry statistics and business trends for the manufac-
ture and surface coating of large appliances in Illinois are
presented in this section. The discussion includes a descrip-
tion of the number of facilities, a comparison of the size
of the major appliance industry to the state economic indi-
cators, a historical characterization of the industry and an
assessment of future industry patterns. Data in this section
form the basis for assessing the impact on this industry
of implementing RACT to VOC emissions in Illinois.
10.2.1 Size of the Industry
The Illinois EPA reports and Booz, Allen interviews have
identified four companies with eight facilities participating
in the manufacture and coating of large appliances as shown in
Exhibit 10-2, on the following page. These companies accounted
for between $1.2 billion and $2.1 billion in shipments. The
estimated number of employees in 1977 was between 8,000 and
10,000. This data and the sources of information are summarized
in Exhibit 10-3, following Exhibit 10-2, and indicate that
Illinois shipped an estimated 8 percent to 13 percent of the
U.S. value of shipments in the large appliance industry.
10.2.2 Comparison of the Industry to the State Economy
A comparison of the value of shipments of large appliances
(in the SIC categories stated previously) with the state economy
indicates that the large appliance industry represents 1.0
percent to 2.0 percent of the total Illinois value of shipments
of all manufactured goods. The industry employs between
0.6 percent and 0.8 percent of all people employed in manufac-
turing in Illinois. These figures are shown in Exhibit 10-4,
following Exhibit 10-3, along with the sources of the data.
10.2.3 Historical and Future Patterns of the Industry
The shipments of major appliances have generally followed
the economic condition of the country. In the last ten years,
sales have generally increased annually, except during the
recession in 1974 and 1975. Shipments peaked in 1973 for all
major appliances.
Shipments picked up in 1976 and continued to grow in
1977. The outlook through 1982 is a continued annual growth
of about 3 percent to 5 percent.
10-6
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EXHIBIT 10-2
U.S. Environmental Protection Agency
LIST OF MANUFACTURERS, POTENTIALLY AFFECTED
BY RACT GUIDELINES, WHO SURFACE COAT
LARGE APPLIANCES IN ILLINOIS
Facility Name
Admiral Appliance
Fedders Corporation
General Electric
(Clothes washers, dryers)
General Electric3
(Washers, dryers)
General Electric
(Cooking equipment)
General Electric
(Hotpoint Range Div.)
General Electric
(Refrigerator Div.)
Norge Fedders Corp.
Location
Galesburg
Effingham
Chicago
Chicago
Chicago Heights
Cicero
Cicero
Marion
a •
Represents separate emissions permit from the listing above.
Source; Illinois EPA Memorandum of June 8, 1978, and Booz,
Allen and Hamilton Inc. interviews.
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EXHIBIT 10-3
U.S. Environmental Protection Agency
INDUSTRY STATISTICS—SURFACE COATING OF LARGE APPLIANCES
ILLINOIS
SIC Code RACT Category
3582 Commercial laundry
3585 Commercial refrigeration
and air conditioning
3589 Commercial cooking
and dishwashing
3631 Household cooking
3632 Household refrigerator
and freezer
3633 Household laundry
3639 Household appliances:
Water heaters
Dishwashers
Trash compactors
TOTAL
U.S. Totals'*
1977
Estimated
No. of Units
Shipped
(thousand)
b
b
b
5,000
7,300
8,500
9,300
Estimated
Value of
Shipments
(? million)
200
9,500
150
1,500
2,000
1,500
800
Estimated
Percent of U.S.
Shipments
20-30
2-4
15-20
20-30
15-20
20-25
8-10
Illinois Totals3
Estimated
Value of
Shipments
($ million)
40-60
200-400
25-30
300-500
300-400
300-400
65-80
Estimated
No. of Units
Shipped
(thousand)
b
b
b
1,000-1,500
1,100-1,500
1,700-2,100
750-950
15,650
8-13
1,230-2,070
4,550-6,050
a. Current Industrial Reports, Major Household Appliances, 1977 (issued June 1978) for categories 3631, 3632, 3633 and
3639.1972 Census of Manufactures Service Industry Machine Shops (issued March 1975 and updated to 1977) for categories
3582, 3585 and 3589.Sales and Marketing Management (April 25, 1977) for categories 3631, 3632, 3633 and 3585.
b. Not available
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 10-4
U.S. Environmental Protection Agency
COMPARISON OF LARGE APPLIANCE STATISTICS WITH STATE
OF ILLINOIS ECONOMIC DATA
Estimated Illinois
Economic Indicators
Estimated Percent of Illinois
Manufacturing Economy Engaged
in Large Appliance Manufacturing
Total 1977 value
of shipments of all
manufactured goods
$103 billion
1.0 to 2.0
Number of employees
in manufacturing
1.2-1.3 million
0.6 to 0.8
Source; Current Industrial Reports, Major Household Appliances, 1977 (issued June 1978)
for categories 3631, 3632, 3633 and 3639; 1972 Census of Manufactures
Industry Machines and Machine Shops (issued March 1975 and updated to 1977)
for categories 3582, 3585 and 3589; Sales and Marketing Management (April 25,
1977) for categories 3631, 3632, 3633 and 3585; Sales and MarkeTIng Management,
April 24, 1978; Annual Survey of Manufactures, Statistics for States Standard
Metropolitan Statistical Areas, Large Industrial Counties and Selected Cities,
1976; Booz, Allen & Hamilton Inc.
-------
The growth of the major appliance market will be reflected
in the growth of the housing industry and the socio-economic
effects of the trends toward smaller families, single-person
households, higher energy costs and the like.
Historical and future growth patterns are shown in
Exhibits 10-5 and 10-6, on the following pages.
10-7
-------
EXHIBIT 10-5
U.S. Environmental Protection Agency
HISTORICAL U.S. SALES FIGURES—SELECTED MAJOR
HOUSEHOLD APPLIANCES FOR 1968-1977
Appliance Sales (Millions Of Units)
Appliance
Washer
Dryer
Range
Dishwasher
Refrigerator
1968
2.9
2.9
4.4
1.9
5.2
1969
4.4
3.0
4.5
2.1
5.3
1970
4.1
2.9
4.5
2.1
5.3
1971
4.6
3.3
4.3
2.5
5.7
1972
5.1
3.9
4.8
3.2
6.3
1973
5.5
4.3
5.0
3.7
6.8
1974
4.9
3.6
4.1
3.3
5.9
1975
4.2
2.9
3.6
2.7
4.6
1976
4.5
3.1
4.2
3.1
4.8
1977
4.9
3.6
4.7
3.4
5.7
Source; Appliance, April 1978, pp. 37-40.
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EXHIBIT 10-6
U.S. Environmental Protection Agency
FIVE-YEAR U.S. SALES FORECAST FOR
SELECTED MAJOR HOUSEHOLD APPLIANCES
(1978-1982)
Appliance
Washer
Dryer
Range
Dishwasher
Refrigerator
Appliance Estimates (Millions Of Units)
1978
5.4
4.0
5.2
3.7
6.0
1979
5.6
4.2
5.4
3.9
6.2
1980
5.7
4.4
5.6
4.1
6.4
1981
5.8
4.5
5.7
4.4
6.5
1982
5.8
4.6
5.8
4.6
6.6
Sourcet Appliance, January 1978, pp. 54-55.
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10.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents the process description for the prep-
aration, application and curing of surface coatings for large
appliances, estimated VOC emissions from facilities coating large
appliances in Illinois and the extent of current control in use.
10.3.1 Large Appliance Process Description
A large appliance plant typically manufactures one or two
types of appliances and contains only one or two lines. The
lines may range from 1,200 to 4,000 meters (3/4 mile to 2-1/2
miles) in length and operate at speeds of 3 to 15 meters (10
to 50 feet) per minute.
Cases, doors, lids, panels and interior parts for large
appliances are stamped from sheet metal and hung on overhead
conveyors. The parts are transported to the cleaning and pre-
treatment sections which are typically located on the ground
floor of the plant.
Exhibit 10-7 and Exhibit 10-8, on the following pages,
describe and illustrate the pretreatment, coating and curing
processes for a typical large appliance facility.
10-8
-------
EXHIBIT 10-7
U.S. Environmental Protection Agency
PRESENT MANUFACTURING TECHNOLOGY DESCRIPTION
MANUFACTURING AND PRETREATMENT
PROCESS DESCRIPTION
Large appliance plant typically manu-
facturers one or two different types of
appliances and contains only one or
two lines
. Lines may range from 1,200 to
4,000 meters (3/4 to 2-1/2
miles) in length
. Lines may operate at speeds of
3 to 15 meters (10 to 50 feet)
per minute
Parts are transported on overhead
conveyors
. Cleaned in an alkaline solution
. Rinsed
. Treated with zinc or iron phos-
phate
. Rinsed again
. Treated with chromate (if
iron phosphate is used)
. Dried at 300°F to 400°F in a
gas fired oven and cooled before
coating
Exterior parts may enter a prime
preparation booth to check the
pretreatment
. Parts can be sanded and tack-
ragged (wiped) to provide an
even finish
COATING PROCESS DESCRIPTION
Primecoat or interior single coat
(0.5 to 1.0 mils) is applied
. Dip coating occurs in a con-
tinuously agitated tank
. Flow coating occurs in an
enclosed booth as the parts
move through on a conveyor
and are sprayed by station-
ary or oscillating nozzles
- Parts may enter a flash-
off tunnel to allow
coating to flow out
properly
. Spray coating occurs in booths
either by automatic electro-
static spraying or manually
- Flashoff of 7 minutes
to allow solvents to rise
slowly in the film to avoid
popping in the oven
Prior to topcoating, the parts are
checked for smoothness and manually
sanded, "tack-ragged" or retouched
with a spray gun
Topcoat or exterior single coat
(direct-to-metal topcoat (1.0 to
1.5 mils) is applied
. Usually applied by automated
electrostatic discs, bell or
other type of spray equipment
. Usually applied in many colors
. Applied in side-draft or down-
draft spray booths equipped
with water wash and undergoes
a 10-minute flashoff period
Inside of many exterior large appli-
ance parts are sprayed with gelsonite
for additional moisture resistance
and for sound deadening
CURING PROCESS DESCRIPTION
Coated parts are baked for about
20 minutes at 180°C to 230°C
(350°F to 450°F) in a multipass
oven
TYPICAL COATINGS AND
SOLVENTS
Coatings include:
. Epoxy
. Epoxy-acrylic
. Acrylic or polyester
enamels
. Alkyd resins
Solvents include:
. Esters
. Keytones
. Aliphatics
. Alcohols
. Aromatics
. Ethers
. Terpenes
Baked for 20 to 30 minutes at
140°C to 180°C (270°F to 350°F)
in a multipass oven
-------
EXHIBIT 10-8
U.S. Environmental Protection Agency
DIAGRAM OP A LARGE APPLIANCE COATING LINE
DIRECT TO METAL TOPCOAT
FROM SHEET METAL MANUFACTURING
EXTERIOR PARTS
(CASES, LIDS AND DOORS)
INTERIOR
PARTS
CLEANSING AND
PRETREATMENT
SECTION
FLASHOFF
(OPEN OR TUNNELED)
FLASHOFF
(OPEN OR TUNNELED)
PRIME DIP
SINGLE COAT
I
TO ASSEMBLY
Source: Control Of Volatile Organic Emissions From Existing Stationary Sources—Volume V: Surface Coating Of
Large Appliances, EPA-450/2-77-034, December 1977.
-------
10.4 EMISSIONS AND CURRENT CONTROLS
This section presents information on the distribution of VOC
emissions during the coating operation, the estimated VOC emis-
sions in Illinois in 1977 and the current level of emission con-
trol implemented in the state.
VOC emissions occur in three areas during the process of
'coating large appliances. They are the application, flashoff and
oven areas. The percent distribution of VOC emissions by area
is as follows:
Percent of VOC Emission
Application Application
Method and Flashoff Oven
Dip 50 50
Flow coat 60 40
Spray 80 20
The percent reduction of emissions for prime coating with
waterborne dip or flow coat operations was assumed to be 80
percent and for high solids (62 percent volume) top coat 60
percent. An overall average of 70 percent reduction in VOC
emissions is assumed in implementation of RACT guidelines for
surface coating of large appliances.
Exhibit 10-9, on the following page, shows the total esti-
mated emissions in tons per year from coaters of major appliances
in Illinois. The estimated emissions in Illinois from eight
appliance coating facilities are 4,136 tons per year.
The Illinois EPA's list of emitters indicates three facil-
ities which have implemented the use of water-based coatings as
a means of reducing their VOC emissions.
10.4.1 RACT Guidelines
The RACT guidelines for control of VOC emissions from the
surface coating of major appliances require the following:
Use of waterborne, high solids (at
least 62 percent by volume) or powder
coating to reduce VOC emissions
Use of add-on control devices, such as
incinerators or carbon adsorbers.
Exhibits 10-10, 10-11 and 10-12, following Exhibit 10-9,
summarize the RACT emission limitations and control options for
VOC emissions control for surface coating of large appliances.
10-9
-------
EXHIBIT 10-9 -
U.S. Environmental Protection Agency
RACT DATA SUMMARY FOR ESTIMATED VOC EMISSIONS FOR
SURFACE COATING OF LARGE APPLIANCES IN STATE OF ILLINOIS
Facility Name
Admiral Appliance
Fedders Corporation
General Electric
(Clothes washers, dryers)
General Electric
(Cooking equipment)
General Electric
(Hotpoint Range Div.)
General Electric
(Refrigerator Div.)
General Electric
(Washers, dryers)
Norge Fedders Corporation
Total
Current Average
Hydrocarbon
Emissions
Potential Control
Efficiency
with RACT
Potential Emission
Reduction
with RACT
(Ton/Year)
2,472
287
149
61
51
849
134
133
4,136
(Percent)
70
70
70
70
70
70
70
70
(Ton/Year)
1,730
200
104
43
35
594
93
93^
2,892
Source: Illinois EPA Memorandum of June 9, 1978.
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EXHIBIT 10-10
U.S. Environmental Protection Agency
EMISSION LIMITATIONS FOR RACT IN THE
SURFACE COATING OF LARGE APPLIANCES
Recommended Limitations For
Low Solvent Coatings
Affected
Facility
Prime, single
or topcoat
application
area, flash-
off area and
oven
kg solvent per liter
of coating
(minus water)
Ibs. solvent per gallon
of coating
(minus water)
0.34
2.8
Source; Control of Volatile Organic Emissions from Stationary
Sources--Vglume V; Surface Coating of Large Appliance's,
EPA-450/2-77-034, December 1977.
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EXHIBIT 10-11
U.S. Environmental Protection Agency
SUMMARY OF APPLICABLE CONTROL TECHNOLOGY FOR
COATING OF LARGE APPLIANCE DOORS, LIDS,
PANELS, CASES AND INTERIOR PARTS
Waterborne
Prime or Interior
'Single Coat
Electrodeposition (EDP)
Waterborne
(Spray, Dip or Flow Coat)
Powder
Top, Exterior or
Interior Single
Coat
Waterborne
(Spray, Dip or Flow Coat)
LARGE APPLIANCES
Doors
Lids
Panels
Cases
Interior Parts
Top or Exterior
Single Coat and
Sound Deadener
High Solids (Sprayl
Waterborne
(Spray, Dip or Flow Coat)
Carbon Adsorption
Prime, Single or
Topcoat Application
and Flashoff Areas
Waterborne
(Spray, Dip or Flow Coat)
Incineration
1 Ovens s Spray Booths„
Carbon Adsorption
Source:
Control of Volatile Emissions From Existing Stationary Sources—Volume V: Surface Coating of Large Appliances,
EPA-450/2-77-034, December 1977.
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i i
EXHIBIT 10-12(1)
U.S. Environmental Protection Agency
RACT CONTROL OPTIONS FOR THE
LARGE APPLIANCE INDUSTRY
Affected Facility
and Application
Control Options
Typical Percent
Reduction
Comparison of Control Options
Prime or interior
single coat
Waterborne
(electrodeposition,
EDP)
90-95a
All applications
Waterborne (spray
dip or flow coat)
70-90a
Provides excellent coverage corrosion protec-
tion and detergent resistance
Fire hazards and potential toxicity are reduced
Dry off oven may be omitted after cleansing if
an iron-phosphate pretreatment is used
Lower energy consumption via lower ventilation
requirements
Good quality control due to fully automated
process may be offset by increased electrical
requirements for the coating, refrigeration
and circulation systems if EDP replaces
waterborne flow or dip coating operations
This would not be true if EDP replaces a
spraying operation
EDP can be expensive on small-scale production
lines
This will likely be the first option considered
because of the possibility that these
coatings can be applied essentially with
existing equipment
Requires a longer flash-off area than organic
solvent-borne coatings
Curing waterborne coatings may allow a de-
crease in oven temperature and some reduc-
tion in airflow but limited reduction if
high humidity conditions occur
-------
EXHIBIT 10-12(2)
U.S. Environmental Protection Agency
Affected Facility
and Application
Control Options
Typical Percent
Reduction
Top, exterior or
interior single
coat
Powder
95-99a
Comparison of Control Options
Spraying electrostatically requires electrical iso-
lation of the entire system. Large lines may
be difficult to convert because coating storage
areas may be hundreds or thousands of feet away
from the application; area
Dip or flow coating application requires closer
monitoring due to their sensitive chemistry
Weather conditions affect the application, so both
flash-off time, temperature, air circulation and
humidity must be frequently monitored
Changes in the number of nozzles may be required
Sludge handling may be more difficult
No solid or liquid wastes to dispose of
Powder may reduce energy requirements in a spray
booth and the ovens because less air is required
than for solvent-borne coatings and flash-off
tunnel is eliminated
Powder can be reclaimed resulting in up to 98%
coating efficiency
All equipment (spray booths, associated equipment
and often ovens) used for liquid systems must be
replaced
Powder films cannot be applied in thicknesses in
less than 2 mils and have appearance limita-
tions
Powder coatings may be subject to explosions
Excessive downtime (half-hour) is required during
color changes. If powders are not reclaimed
in their respective colors, coating usage
efficiency drops to 50% to 60%
-------
EXHIBIT 10-12(3)
U.S. Environmental Protection Agency
Affected Facility
and Application
Top or exterior single
coat and sound
deadener
Control Options
High solids (spray)
Typical Percent
Reduction
60-803
Prime, single of top
coat application
and flash-off »nd
spray booths
Carbon adsorption
90r
Ovens
Incineration
90
The base case against which these percent reductions were
calculated is a high organic solvent coating which con-
tains 25 volume percent solids and 75 percent organic
solvent. The transfer efficiencies for liquid coatings
were calculated to be 80 percent, for powders about 93
percent and for electrodeposition about 99 percent.
reduStion ln VOC ^missions is only across the
"^ ^ ^ aCC°Unt the CaptUre
Comparison of Control Options
May be applied with existing equipment
Reduces energy consumption because it requires
less airflow in the spray booth, oven and
flash-off tunnel
Potential health hazard associated with iso-
cyanates used in some high-solid two-component
systems
Although it is technically feasible, no larger
appliance facilities are known to use carbon
adsorption
Additional energy requirements is a possible
disadvantage
Additional filtration and scrubbing of emissions
from spray booths may be required
There is little possibility of reusing recovered
solvents because of the variety of solvent
mixtures
Many facilities may require dual-bed units which
will require valuable plant space
Particulate and condensible matter from
volatilization and/or degradation of resin
occuring in baking ovens with high temperature
could coat a carbon bed
These are less costly and more efficient than
carbon adsorbers for the baking ovens because
the oven exhaust temperatures are too high for
adsorption and the high concentration of organics
in the vapor could provide additional fuel for
the incinerator
Heat recovery system to reduce fuel consumption
would be desirable and would make application
and flash-off area usage a viable option
Source:
Organic,g™j;53ions frot" Stationary Sources—Volume V: Surface Coatinqs of Large Appliances
-------
10.4.2 Selection of the Most Likely RACT Alternatives
The choice of application of control alternatives, for the
reduction of hydrocarbon emissions in existing facilities for
the surface coating of large appliances, requires a line-by-line
evaluation. A number of factors must be considered, based on
the individual characteristics of the coating line to be con-
trolled. The degree of economic dislocation is a function of
these factors.
The first factor to be considered is whether the existing
equipment can be used by the substitution of a coating material
which will meet the RACT guideline. This alternative would re-
quire the least capital expenditure and minimize production
downtime.
If the existing equipment has to be modified, replaced
or added to, other factors to consider are the kinds of changes
that have to be made, the capital costs, the change in operating
costs, the length of time needed to make the changes, the
effect on the production rate, the operational problems that
will have to be handled and the effect on the quality of the
product.
Interviews with industry representatives indicate a
unanimous opinion in the area of choosing the alternative(s)
for VOC emission control in coating large appliances. The
industry intends to use their existing topcoat application
equipment and modify it to handle high solids. Those companies
that use a primecoat will convert their conventional solvent
systems to either waterborne dip or flow coat or high solids
discs or bells. The alternatives are shown in Exhibit 10-13,
on the following page.
Other alternatives such as electrodeoosition for prime-
coating or powder coating for single coat application may be
implemented in special cases, i.e., where extensive corrosion
protection is required. These alternatives are not incorporated
into this study because their applicability was not specifically
identified in this state.
10-10
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EXHIBIT 10-13
U.S. Environmental Protection Agency
MOST LIKELY RACT CONTROL ALTERNATIVES FOR
SURFACE COATING OF LARGE APPLIANCES
IN STATE OF ILLINOIS
Coat
Prime
Existing System
Dip or flow coating with
conventional solvent
Top
Electrostatic application
with discs or bells of
conventional solvents
Most Likely Alternative Control Techniques
Dip or flow coating with water-
borne solvent
Electrostatic application with
discs or bells of high solids
coatings
Preheat paint, or
Use high speed discs
or bells
Electrostatic application with
discs or bells of high solids
coating
Preheat paint, or
Use high speed discs
or bells
Source: Booz, Allen & Hamilton, Inc.
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10.5 COST AND VOC REDUCTION BENEFIT EVALUATIONS FOR THE
MOST LIKELY RACT ALTERNATIVES
Costs for the VOC emission control systems are presented
in this section. The costs for the alternative primecoat
and topcoat applications are described individually. The
final section presents an extrapolation of typical costs for
surface coating of large appliances to the statewide industry.
•10.5.1 Costs for Alternative Control Systems
Estimates of capital and annualized costs are presented
for controlling solvent emissions from application areas and
curing ovens in primecoats and topcoats of large appliances.
The process modifications involve the converting of a
solvent-borne primecoat or topcoat line to a coating system
which emits lesser amounts of VOC. The coating lines and
the costs for their modification are shown in Exhibit 10-14,
on the following page.
If an existing prime coat conventional-solvent based
dip operation is converted to waterborne dip, the capital
costs cover the requirements for additional equipment for
close humidity and temperature control during flashoffs and
for changeover to materials handling system (pumps and
piping) that can handle water borne coatings without corrosion
related problems. Based on these assumptions, the capital
installed cost of these modifications is estimated at between
$50,000 and $75,000. No additional floor space is required
so the capital allocated building costs remain unchanged.
The fixed costs associated with the increased capital requirements
are estimated at between $15,000 and $20,000. This includes
depreciation, interest, taxes, insurance, administration expenses
and maintenance materials.
For the conversion of primecoat or topcoat solvent-
based electrostatic disc or bell spray to high solids, the
cost of such conversion is based on a number of assumptions:
that the paint will have to be preheated to reduce the viscosity
prior to application, that the existing pumping system will
have to be replaced (including the installation of larger
capacity/head pumps and large diameter piping) and that high
speed (25,000 to 50,000 RPM) turbine or air drive discs or
bells will be required. Also, it is assumed that the type of
booth remains unchanged and that the existing painting configuration
(including the proper indexing layout) requires no change.
10-11
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EXHIBIT 10-14
U.S. Environmental Protection Agency
ESTIMATED COST FOR PROCESS MODIFICATION
OF EXISTING LARGE APPLIANCE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION CONTROL
Existing System
Primecoat
Conventional
solvent-based
dip or flow
Conventional
solvent-based
electrostatic
spray, disc
or bell
Most Likely
Control Alternative
Waterborne dip of
flow coat
High solids
electrostatic
Topcoat
Conventional
solvent-based
electrostatic
spray, disc
or bell
High solids
electrostatic
Major Process
Modification
Instrumentation for close
control of temperature and
humidity
Total repiping and replace-
ment of pumps
Pre-heating system
Installation of high
disc or bells
Repiping for larger
line sizes and possible
coatings pump replace-
ments
Major revamp of booth
line configuration
and air handling system
in addition to changes
stated above
Preheating system
Installation of high
speed disc or bells
Repiping for larger
line sizes and
possible coatings
pump replacement
Major revamp of booth
configuration and air
handling system in
addition to changes
stated above
Capital Cost
Installed capital
$50,000 - $75,000
Annualized cost
$15,000 - $20,000
Installed capital
$50,000 - $75,000
Annualized cost
$15,000 - $20,000
Installed capital
$150,000 - $250,000
Annualized cost
$37,000 - $63,000
Installed capital
$50,000 - $75,000
Annualized cost
$15,000 - $20,000
Installed capital
$750,000 - $250,000
Annualized cost
$37,000 - $63,000
Source: Booz, Allen & Hamilton Inc.
-------
Based on these assumptions, the capital installed cost of
these modifications is estimated at between $50,000 and
$75,000. No additional floor space is required so the capital
allocated building costs remain unchanged. The fixed costs
associated with the increased capital requirements are
estimated at between $13,000 and $19,000. This includes
depreciation, interest, taxes, insurance, administration
expenses and maintenance materials.
Each paint application conversion to meet RACT has its
own unique characteristics. Where such conversions require
major changes in booth structure, paint application techniques
and air handling system, the costs will be considerably higher
than the figures stated above. A first pass estimate, provided
from industry interviews with appliance coaters, at these major
changes indicates a capital requirement of $150,000 to $250,000
per booth. The annualized costs would be $37,000 to $63,000.
Based on industry interviews and Booz, Allen judgment, it is
assumed that 50 percent of the topcoating application units
will require major modifications.
The annual operating expenses will not change appreciably
because the manpower requirements remain the same for the
two systems. There will be a minor savings in the utilities,
associated with the oven curing of the high solids coating.
This could amount to about $1 per hour of operation time
($2,000 to $6,000 per year per line (equivalent to 700 cubic
feet of natural gas/hour/line).
The overall cost of coating materials may increase slightly
even though conversion to water-based or high solids coating
will eliminate the need for solvent thinning. This overall
increase is expected because of the anticipated price increases
in the coatings that will be required to meet the RACT guidelines,
At this time, difinitive numbers in change of paint prices cannot
be developed but an overall paint cost increase of between 10
percent and 20 percent may be anticipated.
10.5.2 Extrapolation to the Statewide Industry
Exhibit 10-15, on the following page, extrapolates the
costs for meeting RACT guidelines for VOC emission control
for surface coating of large appliances to the statewide
industry in Illinois. The 'estimates are based on the following
assumptions:
All large appliance coaters will imple-
ment the control alternatives stated in this
report to comply with RACT.
10-12
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EXHIBIT 10-15
U.S. Environmental Protection Agency
STATEWIDE COSTS FOR PROCESS MODIFICATIONS OF
EXISTING LARGE APPLIANCE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION CONTROL
ILLINOIS
Characteristic
Plants with Top-
coat Process Only
Number of plants 4
Number of process lines 8
Estimated value of shipments
($ Billion) a
Uncontrolled emissions (Ton/yr) a
Potential emission reduction (Ton/yr) a
Installed capital costb ($ Thousand) 1,300
Direct annual operating cost (credit)
($ Thousand) (1-3 shifts/day)
Annual capital charges ($ Thousand)
Net annualized costc
($ Thousand)
Annual cost per ton of emission
reduced ($)
(16-48)
325
277d -
Plants with Primecoat
and Topcoat Process
4
8
a
a
a
1,900
(16-48)
475
427d - 459e
Total
8
16
1.2-2.1
4,136
2,892
3,200
(32-96)
800
704d - 768e
243d - 265^
aTNot available
b. Figures represent the upper limit of the installed capital cost
and annual capital charge
c. Net annualized cost is the"summation of the direct annual operating cost and the annual
capital charges
d. Represents a three shift/day operation
e. Represents a one shift/day operation
Source: Booz, Allen & Hamilton Inc.
-------
The distribution of primecoat or topcoat
or both as applications, as per industry
interview, is: 50 percent of the coaters
topcoat only; the other half both primecoat
and topcoat the appliances, unless specific
information was available for individual
facilities.
Each plant is assumed to have two process
lines.
Also 50 percent of the topcoat applications
require major modifications to meet RACT.
The eight plants identified by the Illinois
EPA represent the majority of all the
state industry production of large
appliances.
For the specific alternatives listed in
Exhibit 10-14, the cost of process modifica-
tions for the prime or top coat operations
are the same.
Actual costs to large appliance coaters may vary depending
on the type of control alternative, manufacturer's equipment
and coating material selected by each manufacturing facility.
Based on the above, the total capital cost to the
industry in Illinois for process modifications to meet
RACT guidelines is estimated at approximately $3.2 million.
The annual cost is estimated at $243-$265 per ton of emission
controlled.
10-13
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10.6 DIRECT ECONOMIC IMPACTS
This section presents the direct economic impacts of
implementing the RACT guidelines for surface coating of large
appliances on a statewide basis. The analysis includes the
availability of equipment and capital; feasibility of the con-
trol technology; and impact on economic indicators, such as
value of shipments, unit price (assuming full cost passthrough),
state economic variables and capital investment.
10.6.1 RACT Timing
RACT must be implemented statewide by January 1, 1982.
This implies that surface coaters of large appliances must have
made their process modifications and be operating within the
next three years. The timing requirements of RACT impose several
requirements on major appliance coaters:
Determine the appropriate emission control
system.
Raise or allocate capital to purchase
equipment.
Acquire the necessary equipment for emission
control.
Install and test the emission control
equipment to insure that the system complies
with RACT.
Generate sufficient income from current
operations to pay the additional annualized
costs incurred with emission control.
The sections which follow discuss the feasibility and the
economic implications of implementing RACT within the required
timeframe.
10.6.2 Technical Feasibility Issues
Technical and economic feasibility issues of implementing
the RACT guidelines are discussed in this section.
Only one major appliance manufacturer interviewed has
attempted to implement the control alternatives discussed in
this report. The company has converted its conventional solvent
flow primecoat to water reducible flow coat.
10-14
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Although a longer flash-off period for water reducible coatings
is usually required, there was not enough floor space available
to add the process line. However, additional heating was added
and the flash-off area temperature was elevated to 130OF-180°F.
Also, extensive humidity controls had to be added because of the
sensitivity of water reducible finish to moisture in the flash-
off area.
The facility also has attempted the application of medium
solids polyester (55 percent to 60 percent by volume) as a top-
coat, using the existing electrostatic discs. There have been
no attempts at pre-heating the paint, and the discs have been
run at 2,400 RPM to 3,300 RPM. The unit, as it is presently
constituted, will not apply 62 percent volume solids or higher.
Pre-heat and/or higher speed disc modifications will have to
be made to handle the more viscous coatings. Under the present
operating conditions, the facility is not meeting the RACT
guidelines for solvent emission control.
The equipment manufacturers interviewed have indicated
that present technology is available to handle and apply high
solids (greater than 62 volume percent solids) using electrostatic
discs or bells. This requires the use of pre-heaters and high
speed application. In addition, high solids coating material
suppliers indicated that sufficient quantities of paint would
be available to meet the expected market demand. Application
equipment manufacturers have indicated that, even with the
projected demand for their equipment, they can maintain a 10-week
to 12-week delivery schedule.
10.6.3 Comparison of Direct Cost with Selected Direct
Economic Indicators
The net increase in the annualized cost to the
coaters of large appliances represents approximately 0.05
percent of the industry's 1977 value of shipments manufactured
in the state. This increase may translate to an approximate
cost increase of $0.15 per unit of household appliance coated;
the average cost of a unit is $311.
The major economic impact in terms of cost to individual
companies will be capital related rather than from increased annualizec
costs. The capital required for RACT compliance may represent
a significant amount of capital appropriations for the com-
panies affected.
Any marginally profitable companies may be severely affected,
although none of the companies interviewed had considered going
out of business because of the projected increased capital
requirements and inability to pass on these costs through higher
prices.
10-15
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10.6.4 Selected Secondary Economic Impacts
This section discusses the secondary impact of implementing
RACT on employment, market structure and productivity.
Employment is expected to remain unchanged. Employment would
be reduced if marginally profitable facilities closed, but the
present indication from the industry is that no such closures are
•anticipated.
It appears that implementation of the RACT guidelines will
have no significant impact on the present market structure.
The major appliance industry can be characterized as being highly
competitive and manufacturers interviewed state that the regulation
may present some cost inequities to smaller and/or less profitable
production lines, i.e., direct cost increases will probably not
be passed along in the marketplace in the form of a price increase
and could further deteriorate the profit position of marginally
profitable operations.
Productivity for those coaters who are topcoating only
with high solids may be increased if they are able to get
more paint on per unit volume and reduce paint application
time.
Exhibit 10-16, on the following page, presents a summary
of the current economic implications of implementation RACT
for surface coating of large appliances in the state of Illinois,
10-16
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EXHIBIT 10-16
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control to
meet RACT guidelines
Discussion
There are eight major large appliance manufacture:
and coaters
1977 statewide value of shipments was estimated
at $1.6 billion and represents 10 percent of
the estimated $15 billion U.S. value of shipments
of the major appliance industry
4,136 tons per year
Waterborne primecoat and high solids topcoat
Waterborne primecoat and high solids topcoat
Affected Areas in Meeting RACT
Capital investment (statewide)
Annual!zed cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$3.2 million
$800,000 which represents 0.05 percent of the
industry's 1977 statewide value of shipments.
Assuming a "direct cost pass-through"—increase
of $0.15/unit for household appliances (based on
a nominal price of $311 per unit appliance)
Reduced natural gas requirements in the curing
operation (equivalent to 6,400 barrels of oil
per year)
No major impact
No major impact
No major impact
Possible problem meeting equipment deliveries
and installation are anticipated if majority of
require deliveries in the same time frame
Commercial application of high solids (greater
than 62% by volume) has not been proven
1,244 tons/year (30 percent of 1977 emission
level)
$254 annualized cost/ton VOC reduction
Source: Booz, Allen 6 Hamilton, Inc.
-------
BIBLIOGRAPHY
Appliance, April 1978
Annual Survey of Manufactures, 1976
Census of Manufactures, Industry Machines
and Machine Shops,1972
Current Industrial Reports, Major Household
Appliances, 1977
Sales and Marketing Management, April 24, 1978
U.S. Environmental Protection Agency, Control of
Volatile Organic Emissions from Stationary Sources-
Volume V; Surface Coating of Large Appliances.
EPA-450/2-77-034, December 1977.
Private conversations with:
Admiral Appliance, Galesburg, Illinois
Ametek Corp., Moline, Illinois
Association of Home Appliances Manufacturers, Chicago, Illinois
Autocrat Corp., New Athens, Illinois
Eagle Range, Belleville, Illinois
Ero Industries, Chicago, Illinois
Eureka Co., Bloomington, Illinois
Evans George Corp., Moline, Illinois
Fedders Corporation, Effingham, Illinois
Ferro Corporation, Cleveland, Ohio
Freezer King, Chicago, Illinois
General Electric Corp., Louisville, Kentucky
Interrad, Stamford, Connecticut
Kewanee Washer Corp., Kewanee, Illinois
Modine Manufacturing Co., McHenry, Illinois
Nordsen Corporation, Amherst, Ohio
Norge-Fedders, Marion, Illinois
Ransburg Corporation, Indianapolis, Indiana
-------
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11.0 THE ECONOMIC IMPACT OF IMPLEMENTING RACT FOR
SOLVENT METAL CLEANING (DECREASING) IN THE
STATE OF ILLINOIS
-------
-------
11.0 THE ECONOMIC IMPACT OF IMPLEMENTING RACT FOR
SOLVENT METAL CLEANING (DECREASING) IN THE~
STATE OF ILLINOIS
This chapter summarizes the estimated economic impact
of the implementation of reasonably available control
technology for volatile organic compound emissions from
solvent metal degreasers. Solvent metal degreasing is the
process of cleaning the surfaces of articles to remove oil,
dirt, grease and other foreign material by immersing the
article in a vaporized or liquid organic solvent. The
chapter is divided into six sections:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Estimated costs of RACT implementation
Direct economic impacts
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines; previous studies of
paper coating; interviews with degreaser users, equipment
and materials; and a review of pertinent published literature.
11-1
-------
11.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATE
11.1.1 Background
Solvent metal cleaning is normally done in one of three
devices:
A cold cleaner, in which the article is immersed,
sprayed or otherwise washed in a solvent at or
about room temperature
An open top vapor degreaser, in which the article
is suspended in a solvent vapor over a pool of
boiling solvent. The solvent vapors condense on
the article and dissolve or wash soils and greases
from it
A conveyorized degreaser, in which articles are
conveyed on a chain, belt or other conveying
system either through a spray or pool of cold
solvent or through a vapor of a boiling solvent.
The cold cleaner and open top vapor degreaser are designed
for batch cleaning and are used in both manufacturing
and maintenance operations. The conveyorized cleaners
are designed for continuous use and are normally found
only in manufacturing operations. A more detailed discus-
sion of these cleaners is presented in a later section
of this chapter.
The EPA has estimated^ that about 1.3 million cold
cleaners operate in the U.S.; about 70 percent are used in
maintenance or service cleaning and 30 percent in manu-
facturing. There are also an estimated 22,200 open top
vapor degreasers and 4,000 vapor conveyorized degreasers.
In 1975, estimated emissions in the United States from these
cleaners exceeded 700,000 metric tons, making solvent
cleaning the fifth largest stationary source of organic
emissions.
1
Control of Volatile Organic Emissions From Solvent Metal
Cleaning, EPA-450/2-77-022, November, 1977.
11-2
-------
As recently as 1974, degreasing operations were exempt
from regulation in sixteen states, since they rarely emitted
more than the 3,000 pounds per day of volatile organic compounds
(VOC) which was the regulatory level then in effect in these
states. They could also qualify for exemption by the substitution
of a solvent not considered to be photochemically active. However,
the EPA1s current direction is toward positive reduction of all
VOC emissions, and the EPA has proposed control technology for
solvent metal cleaning operations which can achieve sizeable
total VOC emission reduction. This technology involves the use
of proper operating practices and the use of retrofit control
equipment.
Proper operating practices are those which minimize solvent
loss to the atmosphere. These include covering degreasing equip-
ment whenever possible, properly using solvent sprays, employing
various means to reduce the amount of solvent carried out of the
degreaser on cleaned work, promptly repairing leaking equipment
and most important, properly disposing of wastes containing volatile
organic solvents.
In addition to proper operating practices, many control
devices can be retrofitted to existing degreasers; however,
because of the diversity in their designs, not all degreasers
require the same type of control devices. Small degreasers using
a room temperature solvent may require only a cover, whereas
large degreasers using boiling solvent may require a refrigerated
freeboard chiller or a carbon adsorption system. Two types of
control equipment which will be applicable to many degreaser designs
are drainage facilities for cleaned parts and safety switches and
thermostats, which prevent large emissions from equipment malfunction.
These controls, the types of degreasers to which they can be applied
and the expected emission reductions are described later in this
chapter.
11.1.2 Method of Estimation of the Number of Degreasers
Subsequent estimation of the economic impact of imple-
menting the proposed RACT for solvent metal cleaning is based
upon a determination of the number of solvent metal cleaners
in the state. This determination was made on the basis of a
detailed industrywide study of metal degreasing in the U.S., conducted
by the Dow Chemical Company under contract to the EPA. The
results of the study are reported in: Study to Support New
Source Performance Standards for Solvent Metal Cleaning
Operations, Contract No. 68-02-1329, June 30, 1976.
11-3
-------
The report was based on a telephone survey of more than
2,500 plants in the metal working industry (SIC groups 25, 33,
34, 35, 36, 37, 38 and 39) with more than 19 employees. The
report presents estimates of the:
Percentage of U.S. plants using solvent degreasing
Percentage of plants using cold cleaners, open top
vapor degreasers or conveyorized cleaners
Average number and type of vapor degreasers used
in these plants
Distribution of these quantities by region.
All of these quantities are further identified by the
eight metal working industries. In the report (based on the
1972 Census of Manufactures) 15,294 open top and 2,796
conveyorized vapor degreasers were estimated to be in use
in the eight SIC groups; an additional 5,000 to 7,000 open
top degreasers were estimated^ to be in use in 1972 in manu-
facturing or service firms not included in one of the eight
SIC groups or in firms with less than 20 employees.
To determine the number of open top and conveyorized vapor
metal degreasers in the state, first the number of plants with
more than 19 employees in each of the eight SIC groups was determined
for the state. The average number of plants using solvent metal
degreasing and the average number and type of cleaners used per plant
were then obtained by using the factors presented in the Dow report.
The results of these calculations and the factors used are tabulated
in Exhibit 11-2, in section 11.2. The total number of open top
degreasers in the state was then estimated by multiplying the
number expected to be used in the eight metal working SIC groups by
the ratio of 22,200/15,200 (the ratio of total open top units in the
U.S. to that used in the eight SIC groups in the U.S.).
Because of their expense and function, conveyorized vapor
degreasing units are most likely to be used in manufacturing only.
Therefore, the total number of these units in the state was assumed
to be same as that calculated for the eight SIC metal working
industries. The total number of conveyorized cleaners, vapor and
cold, was then determined by multiplying the number of vapor con-
veyorized cleaners by 100/85, the EPA2 estimated ratio of total
conveyorized cleaners to vapor conveyorized cleaners in the U.S.
1Interviews with Parker Johnson, Vice President, Sales,
Baron Blakeslee Corp., Cicero, Illinois and with Richard
Clement, Sales Manager, Detrex Chemical, Detroit, Michigan,
July 1978.
2 Control of Volatile Organic Emissions From Solvent Metal
Cleaning, EPA-450/2-77-022, November 1977.
11-4
-------
The number of cold cleaners in the state was based on
the Dow estimates of cold cleaning done in plants in the eight
SIC metal working industries and the EPA estimate of 1,300,000
cold metal cleaners in the U.S., which include 390,000 in
manufacturing use and 910,000 in maintenance or service use.
Then:
The EPA estimates of all cold cleaners in manufacturing
use in the U.S. was multiplied by the ratio of the number
of plants in the metal working industries (SICs 25
and 33-39) in the state to the number in the U.S.
The EPA estimates of all cold cleaners in maintenance
and service use in the U.S. were multiplied by the
ratio of the number of plants in the metal working
industries plus selected service industries (SIC codes
551, 554, 557, 7538, 7539, 7964) for the state to the
number in the U.S. These service industries are
expected to have at least one or more cold cleaners.
SIC 551 applies to industries categorized as new
or used car dealers.
SIC 554 applies to industries categorized as
gasoline service stations.
SIC 557 applies to industries categorized as
motorcycle dealers.
SIC 7538 applies to industries categorized as
general automotive repair shops.
SIC 7539 applies to industries categorized as
automotive repair shops, n.e.c.
SIC 7964 applies to industries categorized as
armature rewinding shops.
The estimates of the total number of cold cleaners in the state
obtained by these calculations are tabulated in Exhibit 11-3.
Cold cleaners in manufacturing use are meant to include only
those cleaners employed in the manufacturing process; cold
cleaners in maintenance and service use are those employed
for this purpose by either manufacturing or service establish-
ments.
11-5
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11.1.3 Method of Estimation of Affected Degreasers
The RACT guidelines propose several exemptions for degreasers
based on size, type of solvent used or emission rate.
The RACT guidelines apply to cleaners with emissions
over 15 pounds in any one day or 3 pounds in any one
hour whichever is greater. it has been estimated1
that about 70 percent of cold cleaners would have
VOC emissions less than this and would not be affected.
Cleaners used exclusively for chemical or physical
analysis or determination of product quality and
acceptance are to be exempt. Since few such cleaners
exist, no correction was made to the estimated number
of cleaners used in determining the estimated compliance
costs.
Those cleaners using 1,1,1-trichloroethane and tri-
chlorotrifluoroethane are to be exempt. Estimates
of the number of open top degreasers which use either
of these solvents range from 35 percent to 60 percent.^
For the purpose of calculating cost impacts in this
study, 35 percent was used. About 10 percent of con-
veyorized cleaners are expected to be exempt^ and about
20 percent of cold cleaners.^
Open top vapor degreasers with less than one square
meter (10.8 square feet) air/vapor interface and
conveyorized degreasers with less than two square
meters (21.6 square feet) are to be exempt. This
exemption applies to about 30 percent of open top
cleaners and 5 percent of conveyorized degreasers.
The guidelines leave open to the degreaser user the option of
changing from nonexempt solvent to an exempt one. In most
cases, this will require some modification of the degreaser
and an additional expense for the modification. In this study
it was assumed that no substitution is made.
Interview with Safety-Kleen Co., Gray-Mills Co. and Kleer-
Flo Co. personnel; these firms are manufacturers of cold
solvent metal degreasing equipment.
Based on information in EPA 450/2-77-022, op. cit., and
interviews with Baron-Blakeslee and Detrex Chemical personnel,
Dow report, op. cit.
11-6
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No reliable information has been found which relate size of
cleaner with solvent composition. Therefore, we have assumed a
uniform distribution of solvent composition with cleaner size,
•i.e., the number of small cleaners using exempt solvents is the
same as the number of large cleaners using exempt solvents. For
instance, the total of affected open top vapor degreasers in the
state was determined by multiplying the total number of open top
vapor degreasers in the state by the fractionsl that are nonexempt
by solvent use and by size, i.e.:
Number exempt by size = (Total number of open top
degreasers) x (Fraction exempt by size, 0.3)
Number exempt by solvent = (Total number of open
top degreasers - number exempt by size) x
(Fraction exempt by solvent, 0.35)
Total number of affected (non-exempt) degreasers =
(Total number of open top degreasers) - (Number
exempt by size) - (Number exempt by solvent)
The resulting estimate of the total number of degreasers in the
state and those exempt from the proposed regulations by size and
solvent composition are summarized in Exhibit 11-4, in section
11.2.
11.1.4 Method of Estimation of Number and Type of Retrofitted
Controls Needed
The proposed regulations specify certain controls which can be
retrofitted to existing solvent metal cleaners. These are discussed
in detail in a later section of this chapter. Briefly they are:
For affected cold cleaners
A cover must be installed when the solvent used has
a volatility greater than 15 millimeters of mercury
at 38°C, or is agitated, or the solvent is heated; and
An internal drainage facility (or, where that is
not possible, an external closed drainage facility)
must be installed, such that the cleaned parts
drain while covered when the solvent used has a
volatility greater than 32 millimeters of mercury
at 38°C; and
Where the solvent has a volatility greater than
32 millimeters of mercury at 38°C, a freeboard
must be installed that gives a freeboard ratio
(i.e., distance from cleaner top to solvent surface
divided by cleaner width) greater than or equal to
0.7; or a water cover where the solvent is heavier
and immiscible or unreactive with water; or some
other system of equivalent control.
•"- See discussion on page 11-6.
11-7
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For affected open top vapor degreasers--
The vapor degreaser must be equipped with a
cover; and
A spray safety switch must be installed which
shuts off the spray pump when the vapor level
drops more than 4 inches; and
If the freeboard ratio is greater than 0.75,
a powered cover must be installed or a refrigerated
chiller; or an enclosure in which a cover or door
opens only when the dry part is entering or
exiting the degreaser; or a carbon adsorption
system; or an equivalent control system.
For affected conveyorized degreasers—
A refrigerated chiller; or carbon adsorption
system; or another equivalent control system
must be installed; and
The cleaner must be equipped with a drying
tunnel or rotating basket to prevent cleaned
parts from carrying out solvent; and
A condenser flow switch and thermostat, a spray
safety switch and a vapor high level control
thermostat must be installed; and
Openings must be minimized during operation
so that entrances and exits silhouette workloads;
and
Downtime covers must be provided for closing off
the entrance and exit during shutdown hours.
Exhibits 11-16, 11-17 and 11-18, of this chapter, summarize estimates
of the percentage of nonexempt cleaners needing these controls.
Equipment manufacturers were the primary source of the percentages
used. In applying this information, it was assumed that the
number and types of controls needed were independent of size.
11-8
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11.1.5 Method of Estimation of Current Emissions and Expected
Reductions
Current VOC emissions from solvent metal degreasing and the
reductions anticipated by the enforcement of the proposed regulations
are based on information presented in Control of Volatile Organic
Emissions from Solvent Metal Cleaning, EPA-450/2-77-022, November
1977. This report estimates average emissions for each type of
degreaser. The total current emissions were obtained by multiplying
these estimated average emissions by the number of each type of
degreaser in the state.
The report also estimates the reduction in emissions possible
by implementation of various types of controls. The methods proposed
in recent EPA guidance can result in reduction of 50 percent to 69
percent for various types of degreasers. Emission levels which would
result from implementation of the RACT proposals for solvent metal
cleaners were obtained by use of these estimated reductions for the
number of affected cleaners in the state. For purposes of estimation,
a 50 percent reduction was used for cold cleaners. For open top
vapor and conveyorized cleaner, a 60 percent reduction was used.
11.1.6 Method of Estimation of Compliance Costs
Compliance costs also were based primarily on the cost data
presented in the EPA report, Control of Volatile Organics Emissions
from Solvent Metal Cleaning, for average-sized, cold, open top
vapor and conveyorized cleaners. The cost data, however, were
verified by discussions with equipment manufacturers. Where some
costs, such as for safety switches or downtime covers, were not
estimated in the report, estimates were made based on further
discussions with equipment manufacturers. In the EPA report, costs
were presented for various retrofit control options; in each case
the control which would provide minimum net annualized costs was
used in the estimates made here. Other costs not presented in
the EPA report were determined as follows:
Safety switches, minimizing conveyorized cleaner
openings, and downtime cover capital costs were
estimated on the basis of discussions with equip-
ment manufacturers. Costs used were:
$275 per manual cover and $100 per safety switch
installation for open top vapor degreasers
$250 per safety switch installation, $300 per
downtime cover installation, $2500 per drying
tunnel, and $1000 for reducing openings for
conveyorized cleaners.
11-9
-------
$300 was used as an average cost for increasing
freeboard of cold cleaners using high volatility
solvents.
Annual capital charges were estimated as 25 percent
of capital costs, to include depreciation, interest,
maintenance, insurance and administrative costs.
Labor costs for mounting downtime covers on conveyorized
cleaners at shift end were estimated at $1,500 per year
per cleaner.
Additional costs which might result from decreased
productivity, labeling and other requirements of the
proposed regulations were assumed to be small and
negligible.
11.1.7 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, direct compliance cost and economic impact of
implementing RACT controls on plants using solvent metal degreasers
in Illinois. A rating scheme is presented in this section to
indicate the quality of the data available for use in this study.
A rating of "A" indicates hard data, "B" indicates data that were
not available in secondary literature and were extrapolated from
hard data (i.e., data that are published for the base year) and
"C" indicates data were estimated based on interviews, analyses
of previous studies and best engineering judgement. Exhibit 11-1,
on the following page, rates each study output and overall quality
of the data.
11-10
-------
EXHIBIT 11-1
U.S. Environmental Protection Agency
DATA QUALITY
Study Outputs
A B
Hard Extrapolated
Data Data
Estimated
Data
Industry statistics
X
X
Emissions
X
Cost of emissions
control
X
X
Statewide costs of
emissions
X
Overall quality of
data
X
Source; Booz, Allen & Hamilton Inc.
-------
11.2 INDUSTRY STATISTICS
This section summarizes an estimation of the total
number of solvent metal cleaners in the state determined by
the methods discussed in section 11.1.2 of this report. As
shown in Exhibits 11-2 and 11-3, on the following pages, a
total of 1,466 open top vapor degreasers, 325 conveyorized
degreasers and 77,900 cold cleaners are estimated to be in
use in Illinois in manufacturing, maintenance or service.
As discussed earlier, not all of these will be subject to
RACT regulations because of size or solvent exemptions.
About 30 percent of open top vapor degreasers, 5 percent of
conveyorized degreasers and 70 percent of cold cleaners are
expected to be exempt on the basis of size. About 35
percent of open top vapor degreasers, 10 percent of con-
veyorized degreasers and 20 percent of cold cleaners are
expected to be exempt because they use exempt solvents 1,1,1-
trichloroethane or Freon 113. Applying these factors
results in the total of affected cleaners shown in Exhibit
11-4, following Exhibit 11-3.
It is difficult to estimate the number of establish-
ments affected by the regulations, since a plant may have
one or many cleaners of each type. In fact, large-scale
users may have more than 100 degreasing operations in one
plant location. Metal working industries would be major
users; eight SIC codes, 25 and 33-39, cover these indus-
tries.
These classifications include such industries as auto-
motive, electronics, appliances, furniture, jewelry, plumbing,
aircraft, refrigeration, business machinery and fasteners.
However, use of solvent cleaning is not limited to those
industries, since many cleaners are used, for both manufac-
turing and maintenance, in nonmetal working industries such
as printing, chemicals, plastics, rubber, textiles, paper
and electric power. Also, most automotive, railroad, bus,
aircraft, truck and electric motor repair stations use metal
solvent cleaners at least part time.
As shown in Exhibit 11-2, 1,649 establishments in the SIC
codes 25 and 33-39, with more than 19 employees are estimated
to use solvent metal degreasing. However, as shown in
Exhibit 11-3, following Exhibit 11-2, there are a total of
8,938 plants in SIC groups 25 and 33-39 and an additional,
10,397 plants in service industries; all of these are expected
to have some type of solvent degreasers and could be potentially
affected.
11-11
-------
EXHTBTT 11-2 (1)
U.S. Environmental Protection Agency
ESTIMATED NUMBER OF VAPOR DEGREASERS
IN ILLINOIS
Item
Number of Illinois
plants with more
than 19 employees3
Percent of U.S.
plants using sol-
vent degreasing''
Percent of Illinois
plants using sol-
vent degreasing
Number of Illinois
plants using sol-
vent degreasing
Percent of U.S.
plants using vapor
degreasing
Percent of Illinois
plants using vapor
degreasing
Number of Illinois
plants using vapor
degreasing
Average number of
vapor degreasers
per U.S. plant
Average number of
vapor degreasers
per Illinois plant
Nunfcer of vapor de-
greasers in Illinois
25
Metal
Furniture
165
46
45
74
48
46
34
1.98
1.85
63
33 34
Primary Fabricated
Metals Products
SIC Group
36
"39"
320
40
39
125
42
40
50
2.21
2.06
103
1,058
42
41
434
41
39
170
1.62
1.51
257
35 36 37 38
Nonelectri- Electrical Transptn. Instruments Misc.
cal Machinery Equipment Equip-nent and clocks Industry
914
52
51
466
33
31
144
1.61
1.50
216
528
55
54
285
67
64
182
2.03
1.89
142
50
49
70
43
41
29
343
3.25
3.03
88
160
65
64
102
62
59
67
2.27
2.12
142
72
1.02
0.95
68
Total
3,533
246
39
38
93 1,649
56
53
748
1,280
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EXHIBIT 11-2 (2)
U.S. Environmental Protection Agency
(Illinois)
Item
Percent in U.S.
as open top de-
greasers
Percent in Illinois
as open top de—
greasers
tftariber of open top
vapor degreasers
in Illinois
Number of conveyor-
ized vapor degreasers
in Illinois
25
Metal
Furniture
74
69
44
19
33 31
Primary Fabricated
Metals Products
79
74
76
27
79
74
190
67
35
Nonelectri-
eal Machinery
81
76
164
52
SIC Group
36
Electrical
Equipment
87
81
278
65
37
Transptn.
Equipment
87
81
71
17
38
Instruments
and clocks
94
88
125
17
39
Misc.
Industry Total
89
83
56 1,004C
12
276°
Note: All data based on plants with more than 19 employees. Nunber of degreasers rounded to nearest whole integer.
a. Source! County Business Patterns, U.S. Dept. of Commerce, 1976
b. Source of data on percentage of solvents degreasing, those with open tap or conveyorized vapor degreasers and average
nunfoers of degreasers per plant: Study to Support New Source Performance Standards for Solvent Metal Cleaning Operations,
Dow Chendcal Company under EPA Contract 68-02-1329, June 30, 1976
c. to adjust quantities to account for vapor degreasera in other SIC qroups multiply by the factor (22,200/15,200), the ratio
of all vapor degreasers in U.S. to open top vapor degreasers in metal working SIC qroups.
d. Tto adjust quantities to include cold conveyorized cleaners, multiply by 100/85, since conveyorized vapor cleaners are
estimated to represent 85 percent of all conveyorized cleaners.
Source: Booz, Allen 6 Hamilton Inc. analysis of Department of Comerce and EPA Reports
-------
EXHIBIT 11-3
U.S. Environmental Protection Agency
ESTIMATED NUMBERS CF COLD
CLEANERS IN ILLINOIS
U.S.
Total number of plants in SIC Groups
25,33,34,35,36,37,38,39a
Estimated number of cold cleaners in
manufacturing^
Total number of plants in service
industries 551,554,557,7538,7539,7964a
Estimated number of cold cleaners
in maintenance and service useb'c
Estimated total number of cold cleaners3
125,271
400,000
227,350
900,000
1,300,000
Illinois
8,938
28,600
10,397
49,300
77,900
Notes:
a. Source: 1976 County Business Patterns, U.S. Department of Comerce, 1976.
b. Source: Control of Volatile Organic Emissions From Solvent Metal Cleaning, EPA-450/2-77-022,
November 1977.
c. This includes cold cleaners in maintenance and service applications in both manufacturing and
repair firms.
Source: Booz, Allen & Hamilton Inc.
-------
EXHIBIT 11-4
U.S. Environmental Protection Agency
ESTIMATE OF AFFECTED SOLVENT METAL
CLEANERS IN ILLINOIS
Exemption
Total number of
cleaners
Number exempt by size
Number nonexempt by
size
Number further exempted
by type of solvent
used
Total number of affected
cleaners
Number of Cleaners by Type
Cold
77,900
54,530
23,370
4,670
18,700
Open Top Vapor
1,466
440
1,026
359
667
Conveyorized
325
17
308
31
277
Note: Number of cold cleaners rounded to nearest 10 units; others to
nearest integer.
Source: Booz, Allen & Hamilton Inc.
-------
11.3 THE TECHNICAL SITUATION IN THE INDUSTRY
11.3.1 Solvent Metal Cleaning Processes1
Solvent metal cleaning describes those processes using
nonaqueous solvents to clean and remove soils from metal
surfaces. These solvents, which are principally derived
from petroleum, include petroleum distillates, chlorinated
hydrocarbons, ketones and alcohols. Organic solvents, such
as these, can be used alone or in blends to remove water-
insoluble soils for cleaning purposes and to prepare parts
for painting, plating, repair, inspection, assembly, heat
treatment or machining.
A broad spectrum of organic solvents is available.
Choices among the solvents are based on the solubility of
the soil, toxicity, flammability, evaporation rate, effect
on nonmetallic portions of the part cleaned and numerous
other properties. Exhibit 11-5, on the following page, lists
solvents normally used in solvent degreasing.
The cleaning techniques can be broken down into two cate-
gories: cold cleaning and vapor degreasing. In cold cleaning,
parts are dipped, sprayed, brushed or wiped with solvents at or
near room temperature. In vapor degreasing, cold parts are
suspended in a solvent vapor which condenses on the parts and
dissolves greases and other soils.
Typically, the cleaning process is done in one of three
types of cleaners or degreasers:
A cold cleaner
An open top vapor degreaser
A conveyorized degreaser.
1
The descriptive and other information in this section has
been obtained from Control of Volatile Organic Emissions
from Solvent Metal Cleaning (EPA-450/2-77-022, November,
1977).This document should be consulted for a more
detailed description of the techniques and devices used
for solvent degreasing.
11-12
-------
EXHIBIT 11-5
U.S. Environmental Protection Agency
SOLVENTS CONVENTIONALLY USED IN
SOLVENT METAL DECREASING
General Type
Alcohols
Solvent
Ethanol (95%)
Isopropanol
Methanol
Alipatic hydrocarbons
Heptane
Kerosene
Stoddard
Mineral spirits 66
Aromatic hydrocarbons
Benzene
SC 150
Toluene
Turpentine
Xylene
Chlorinated solvents
Carbon tetrachloride
Methylene chloride
Perchloroethylene
1,1,1-trichloroethane
Trichloroethylene
Fluorinated solvents
Trichlorotrifluoroethane
(Freon 113)
Ketones
Acetone
Methyl ethyl ketone
Source
Booz, Allen & Hamilton Inc.
-------
11.3.1.1 Cold Cleaners
Cold cleaner operations include spraying, brushing, flush-
ing and immersion. The solvent occasionally is heated in cold
cleaners but always remains well below its boiling point.
Cold cleaners are estimated to result in the largest total
emission of the three categories of degreasers. This is primarily
because there are so many of these units (more than 1 million
nationally) and because much of the waste solvent that is dis-
posed of is allowed to evaporate. It is estimated that cold
cleaners emit 420,000 short tons of organics per year, about
55 percent of the national degreasing emissions. Cold cleaning
solvents nationally account for almost all of the aliphatic,
aromatic and oxygenated degreasing solvents and about one-third
of halogenated degreasing solvents.
Despite the large aggregate emission, the average cold
cleaning unit generally emits only about one-third ton per
year of organics, with about one-half to three-fourths of that
emission resulting from evaporation of the waste solvent at a
disposal site.
In a typical cold cleaner (Figure 11-1, on the following
page), dirty parts are placed in a basket and are cleaned manually
by spraying or soaking in a dip tank. The solvent in this dip
tank is often agitated to enhance the cleaning action. After
cleaning, the basket of cleaned parts may be suspended over the
solvent to allow the parts to drain, or the cleaned parts may be
drained on an external drainage rack which routes the drained
solvent back into the cleaner. The cover should be closed when-
ever parts are not being handled in the cleaner. Typically, a
maintenance cold cleaner has about 0.4 m (4 ft.2) of opening
and about 0.1 m3 (30 gallon) capacity.
The two basic types of cold cleaners are maintenance
cleaners and manufacturing cleaners. The maintenance cold
cleaners are usually simpler, less expensive and smaller. They
are designed principally for automotive and general plant main-
tenance cleaning.
Manufacturing cold cleaners usually give a higher quality
of cleaning than maintenance cleaners do, and are thus more
specialized. Manufacturing cold cleaning is generally an
integral stage in metal working production. There are fewer
manufacturing cold cleaners than maintenance cleaners, but the
former tend to emit more solvent per unit because of the larger
11-13
-------
FIGURE 11-1
U.S.Environmental Protection Agency
SPRAY CLEANING EQUIPMENT
Source: EPA-450/2-77-022, op. cit
-------
size and workload. Manufacturing cleaners use a wide variety
of solvents, whereas maintenance cleaners use mainly petroleum
solvents such as mineral spirits (petroleum distillates and
Stoddard solvents). Some cold cleaners can serve both mainten-
ance and manufacturing purposes and thus are difficult to
classify.
11.3.1.2 Open Top Vapor Degreasers
Vapor degreasers clean through the condensation of hot
solvent vapor on colder metal parts. Open top vapor degreasers
are batch loaded, i.e., they clean only one workload at a time.
Open top vapor degreasers are estimated to result in the
second largest emission of the three categories of degreasers.
It is estimated that open top vapor degreasers emit 220,000 short
tons of organic per year, this being about 30 percent of the
national degreasing emissions.
In the vapor degreaser, solvent vapors condense on the
parts to be cleaned until the temperature of the parts
approaches the boiling point of the solvent. The condensing
solvent both dissolves oils and provides a washing action to
clean the parts. The selected solvents boil at much lower
temperatures than do the contaminants; thus, the solvent/soil
mixture in the degreaser boils to produce an essentially pure
solvent vapor.
The simplest cleaning cycle involves lowering the parts
into the vapor zone so that the condensation action can
begin. When condensation ceases, the parts are slowly with-
drawn from the degreaser. Residual liquid solvent on the parts
rapidly evaporates as the parts are removed from the vapor
zone. The cleaning action is often increased by spraying the
parts with solvent (below the vapor level) or by immersing
them into the liquid solvent bath.
A typical vapor degreaser, shown in Figure 11-2, on the
following page, is a tank designed to produce and contain sol-
vent vapor. At least one section of the tank is equipped with
a heating system that uses steam, electricity or fuel combus-
tion to boil the solvent. As the solvent boils, the dense
solvent vapors displace the air within the equipment. The
upper level of these pure vapors is controlled by condenser
coils located on the sidewalls of the degreaser. These coils,
which are supplied with a coolant such as water, are generally
located around the entire inner surface of the degreaser, although
for some smaller equipment they are limited to a spiral coil
at one end of the degreaser. Most vapor degreasers are also
equipped with a water jacket which provides additional cooling
and prevents convection of solvent vapors up hot degreaser walls.
11-14
-------
FIGURE 11-2
U.S.Environmental Protection Agency
OPEN TOP DEGREASER
Safety Thermostat
Condensing Coifs
Temperature
Indicator
Oeanout Door
Solvent Level Sight Glass
Freeboard
Water Jacket
Condensate Trough
t
Water Separator
Heating Elements
Work Rest And Protective Grate
Source: EPA-450/2-77-022, op. cit.
-------
The cooling coils must be placed at some distance below
the top edge of the degreaser to protect the solvent vapor
zone from disturbance caused by air movement around the equip-
ment. This distance from the top of the vapor zone to the
top of the degreaser tank is called the freeboard and is
generally established by the location of the condenser coils.
Nearly all vapor degreasers are equipped with a water
separator, such as that depicted in Figure 11-2. The con-
densed solvent and moisture are collected in a trough below
the condenser coils and directed to the water separator.
The water separator is a simple container which allows the
water (being immiscible and less dense than solvents) to
separate from the solvent and decant from the system while
the solvent flows from the bottom of the chamber back into the
vapor degreaser.
11.3.1.3 Conveyorized Degreaser
There are several types of conveyorized degreasers, operat-
ing both with cold and with vaporized solvents. An average
conveyorized degreaser emits about 25 metric tons per year of
solvent; however, because of their limited numbers, these
degreasers contribute only about 15 percent of the total solvent
degreasing emissions. Because of their large work capacity,
conveyorized degreasers actually emit less solvent per part
cleaned than either open top vapor degreasers or cold cleaners.
In conveyorized equipment, most, and sometimes all, of the
manual parts handling associated with open top vapor degreasing
has been eliminated. Conveyorized degreasers are nearly always
hooded or covered. The enclosure of a degreaser diminishes
solvent losses from the system as the result of air movement
within the plant. Conveyorized degreasers are used by a broad
spectrum of metal working industries but are most often found
in plants where there is enough production to provide a con-
stant stream of products to be degreased.
There are a number of types of conveyorized degreasers
employing various techniques of conveying the parts, either
through a pool or spray of cold cleaning solvents or through
a space containing vaporized solvent. A cross-rod degreaser
(Figure 11-3, on the following page) illustrates the general
concepts of operation of the various types of conveyorized
degreasers.
11-15
-------
FIGURE 11-3
U.S.Environmental Protection Agency
CROSS-ROD CONVEYORIZED DEGREASER
Source: EPA-450/2-77-022, op. cit.
-------
The cross-rod degreaser obtains its name from the rods
between the two power driven chains from which parts are
supported as they are conveyed through the equipment. The
parts are contained in pendant baskets or, where tumbling
of the parts is desired, perforated cylinders. These
cylinders are rotated by a rack and pinion design within the
solvent and/or the vapor zone. This type of equipment lends
itself particularly well to handling small parts which need
to be immersed in solvent to obtain satisfactory cleaning or
require tumbling to provide drainage from cavities in the
parts.
Other types of conveyorized degreasers similarly use
rotating wheels, conveyor belts, monorail or other systems
to convey the parts through the degreasing medium.
11.3.2 Proposed Emission Control Systems for Solvent
Metal Cleaners"!
The EPA has proposed two different emission control methods,
A and B, for each of the three types of cleaners: cold, open
top vapor and conveyorized. The control methods can be combined
in various ways to form a number of alternative control systems.
Generally, control system A consists of proper operating prac-
tices and simple, inexpensive control equipment. Control system
B consists of system A plus other devices that increase the
effectiveness of control. Elements of control systems A or B
can be modified to arrive at the level of control needed. The
control systems are presented in the three exhibits, Exhibit
11-6, 11-7 and 11-8, on the following pages, and are briefly
discussed below. In general, use of control system B has been
proposed to maximize emission reductions.2
11.3.2.1 Cold Cleaning Control Systems
The most important emission control for cold cleaners is
the control of waste solvent. The waste solvent needs to be
reclaimed or disposed of so that a minimum evaporates into the
atmosphere. Next in importance are the operating practices of
closing the cover and draining cleaned parts. Several other
control techniques become significant only in a small fraction
of applications.
The difference in effect between systems A and B (Exhibit
11-6) is not large because most of the cold cleaning emissions
are controlled in system A. If the requirements of system A
1
Control of Volatile Organic Emissions From Solvent Metal
Cleaning, EPA-450/2-77-022 (November 1977).
2
Regulatory Guidance for Control of Volatile Organic Emissions
from 15 Categories of Stationary Sources, EPA-905/2-78-001,
(April 1978) .
11-16
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EXHIBIT 11-6
U.S. Environmental Protection Agency
CONTROL SYSTEMS FOR COLD CLEANING
Control System A
Control Equipment:
1. Cover
2. Facility for draining cleaned parts
3. Permanent, conspicuous label, summarizing the operating requirements
Operating Requirements:
1. Do not dispose of waste solvent or transfer it to another party, such that greater than 20 percent
of the waste (by weight) can evaporate into the atmosphere.* Store waste solvent only in covered containers.
2. Close degreaser cover whenever not handling parts in the cleaner.
3. Drain cleaned parts for at least 15 seconds or until dripping ceases.
Control System B
Control Equipment:
1. Cover: Same as in System A, except if (a) solvent volatility is greater than 2 Kpa (15 mm Hg or 0.3 psi)
measured at 38*C (100°F),** (b) solvent is agitated, or (c) solvent is heated, then the cover must be designed so that
it can be easily operated with one hand. (Covers for larger degreasers may require mechanical assistance, by spring
loading, counterweighting or powered systems.)
2. Drainage facility: Same as in System A, except that if solvent volatility is greater than about 4.3 Kpa
(32 mm Hg or 0.6 psi) measured at 38° C (100°F), then the drainage facility must be internal, so that parts are
enclosed under the cover while draining. The drainage facility may be external for applications where an internal
type cannot fit into the cleaning system.
3. Label: Same as in System A
4. If used, the solvent spray must be solid, fluid stream (not a fine, atomized or shower type spray)
and at a pressure which does not cause excessive splashing.
5. Major control device for highly volatile solvents: If the solvent volatility is 4.3 Kpa (33 mm Hg or
0.6 psi) measured at 38°C (100'F), or if solvent is heated about 50°C (120°F), then one of the following control
devices must be used:
a. Freeboard that gives a freeboard ratio*** 0.7
b. Hater cover (solvent must be insoluble in and heavier than water)
c. Other systems of equivalent control, such as refrigerated chiller or carbon absorption.
Operating Requirements:
Same as in System A
* Water and solid waste regulations must also be complied with
*• Generally solvents consisting primarily of mineral spirits (Stoddard) have volatilities 2 Kpa.
*** Freetoard ratio is defined as the freeboard height divided by the width of the degreaser.
-------
EXHIBIT 11-7(1)
U.S. Environmental Protection Agency
EPA PROPOSED CONTROL SYSTEMS FOR OPEN TOP VAPOR DEGREASERS
Control System A
Control Equipment:
1. Cover that can be opened and closed easily without disturbing the vapor zone.
Operating Requirements:
1. Keep cover closed at all times except when processing work loads through the degreaser.
2. Minimize solvent carry-out by the following measures:
a. Rack parts to allow full drainage.
b. Move parts in and out of the degreaser at less than 3.3 m/sec (11 ft/min).
c. Degrease the work load in the vapor zone at least 30 sec. or until condensation ceases.
d. Tip out any pools of solvent on the cleaned parts before removal.
e. Allow parts to dry within the degreaser for at least 15 sec. or until visually dry.
3. Do not degrease porous or absorbent materials, such as cloth, leather, wood or rope.
4. Work loads should not occupy more than half of the degreaser's open top area.
5. The vapor level should not drop more than 10 cm (4 in) when the work load enters the vapor zone.
6. Never spray above the vapor level.
7. Repair solvent leaks immediately, or shut down the degreaser.
8. Do not dispose of waste solvent or transfer it to another party such that greater than 20 percent of the
waste (by weight) will evaporate into the atmosphere. Store waste solvent only in closed containers.
"\ 2 2
9. Exhaust ventilation should not exceed 20 m /min per m (65 cfm per ft ) of degreaser open area, unless
necessary to meet OSHA requirements. Ventilation fans should not be near the degreaser opening.
10. Water should not be visually detectable in solvent exiting the water separator.
Control System B
Control Equipment:
1. Cover (same as in system A).
2. Safety switches
a. Condenser flow switch and thermostat - (shuts off sump heat if condenser coolant is either not circulating
or too warm).
b. Spray safety switch - shuts off spray pump if the vapor level drops excessively, about 10 cm (4 in).
-------
EXHIBIT 11-7(2)
U.S. Environmental Protection Aqency
3. Major Control Device:
Either: a. Freeboard ratio greater than or equal to 0.75, and if the degreaser opening is
1m2 (10 ft2), the cover must be powered,
b. Refrigerated chiller,
c. Enclosed design (cover or door opens only when the dry part is actually entering or
exiting the degreaser),
d. Carbon adsorption system, with ventilation 15 m3/roin per m2 (50 cfm/ft2) or air/vapor
area (when cover is open), and exhausting 25 ppm solvent averaged over one complete adsorption cycle, or
e. Control system, demonstrated to have control efficiency, equivalent to or better than
any of the above.
4. Permanent, conspicuous label, summarizing operating procedures II to 16.
Operating Requirements:
Same as in System A.
Source: EPA-450/2-77-022, op. cit.
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EXHIBIT 11-8
U.S. Environmental Protection Agency
EPA PROPOSED CONTROL SYSTEMS FOR CONVEYORIZED DEGREASERS
Control System A
Control Equipment: None
Operating Requirements:
1. Exhaust ventilation should not exceed 20 m3/min per m2 (65 cfm per ft2) of degreaser opening,
unless necessary to meet OSHA requirements. Work place fans should not be used near the degreaser opening.
2. Minimize carry-out emissions by:
a. Racking parts for best drainage.
b. Maintaining verticle conveyor speed at 3.3 m/min (11 ft/min).
3. Do not dispose of waste solvent or transfer it to another party such that greater than 20 percent
of the waste (by weight) can evaporate into the atmosphere. Store waste solvent only in covered containers.
4. Repair solvent leaks immediately, or shut down the degreaser.
5. Water should not be visibly detectable in the solvent exiting the water separator.
Control System B
1. Major control devices; the degreaser must be controlled by either:
a. Refrigerated chiller,
b. Carbon adsorption system, with ventilation 15 m2/min per m2 (50 cfm/ft2) of air/vapor area (when down-time
covers are open), and exhausting 25 ppm of solvent by volume averaged over a complete adsorption cycle, or
c. System demonstrated to have control efficiency equivalent to or better than either of the above.
2. Either a drying tunnel, or another means such as rotating (tumbling) basket, sufficient to prevent cleaned parts
from carrying out solvent liquid or vapor.
3. Safety switches
a. Condenser flow switch and thermostat - (shuts off sump heat if coolant is eiter not circulating or too warm).
b. Spray safety switch - (shuts off spray pump or conveyor if the vapor level drops excessively, e.g. 10 cm (4 in.))
c. Vapor level control thermostat - (shuts off sump heat when vapor level rises too high).
4. Minimized openings: Entrances and exits should silhouette work loads so that the average clearance (between
parts and the edge of the degreaser opening) is either 10 cm (4 in.) or 10 percent of the width of the opening.
5. Down-time covers: Covers should be provided for closing off the entrance and exit during shutdown hours.
Operating Requirements:
1. to 5. Same as the System A
6. Down-time cover must be placed over entrances and exits of conveyorized degreasers immediately after the
conveyor and exhaust are shut down and removed just before they are started up.
Source: EPA-450/2-77-022, op. cit.
-------
were followed conscientiously by nearly all of the cold
cleaning operators, there would be little need for the
additional system B requirements. However, because cold
cleaning operators tend to be lax in keeping the cover
closed, equipment requirements #1 and #4 in system B are
added. Similarly, the modifications for #2 and the equipment
requirements in #3 would effect significant emission reduc-
tions in a few applications.
The effectiveness of the control systems depends greatly
on the quality of operation. On the average, system A is
estimated to be able to reduce cold cleaning emissions by
50 ( + 20) percent and system B may reduce it by 53 (+ 20)
percent. The low end of the range represents the emTssion
reduction projected for poor compliance, and the high end
represents excellent compliance. The expected benefit from
system B is only slightly better than that for system A for
an average cold cleaner because the additonal devices required
in system B generally control only bath evaporation, about 20
to 30 percent of the total emission from an average cold
cleaner. For cold cleaners with high volatility solvents,
bath evaporation may contribute about 50 percent of the total
emission; EPA estimates that system B could achieve 69 (+20)
percent control efficiency, whereas system A might achieve
only 55 (+ 20) percent.
11.3.2.2 Open Top Vapor Degreasing Control Systems
The basic elements of a control system for open top vapor
degreasers are proper operating practices and use of control
equipment. There are about ten main operating practices. The
control equipment includes a cover, safety switches and a major
control device, either high freeboard, refrigerated chiller,
enclosed design or carbon adsorption as outlined in Exhibit 11-7
A vapor level thermostat is not included because it is
already required by OSHA on "open surface vapor degreasing
tanks." Sump thermostats and solvent level controls are
used primarily to prevent solvent degradation and protect the
equipment and thus are also not included here. The emission
reduction by these controls is a secondary effect in any event.
The two safety switches serve primarily to reduce vapor solvent
emissions.
11-17
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EPA estimates that system A may reduce open top vapor
degreasing emissions by 45 (+15) percent, and system B by
60 (+15) percent. For an average-sized open top vapor de-
greas~er, systems A and B would reduce emissions from 9.5
metric tons/year down to about 5.0 and 3.8 metric tons/
year, respectively. It is clear that system B is appreciably
more effective than system A.
11.3.2.3 Conveyorized Degreasing Control Systems
Control devices tend to work most effectively on con-
veyor ized degreasers, mainly because they are enclosed. Since
these control devices can usually result in solvent savings,
they often will net an annualized profit. Two control systems
for conveyorized degreasers as recommended by EPA are in Exhibit
11-8. Control system A requires only proper operating pro-
cedures which can be implemented, in most cases, without large
capital expenditures. Control system B, on the other hand,
requires a major control device.
Major control devices can provide effective and economical
control for conveyorized degreasers. A refrigerated chiller
will tend to have a high control efficiency, because room
drafts generally do not disturb the cold air blanket. A
carbon adsorber also tends to yield a high control efficiency,
because collection systems are more effective and inlet streams
contain higher solvent concentrations for conveyorized
degreasers than for open top vapor degreasers.
11-18
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11.3.3 Emissions and Expected Emission Reduction
In Exhibit 11-9, on the following page, are summarized
the average emissions from solvent metal degreasers by type
and also the percent emission reduction expected by imple-
mentation of Type B method of controls on nonexempt degreasers.
The levels are based on estimated emissions as presented in the
previously referenced EPA report (EPA 450/2-77-022) and represent
current average emission levels and expected reductions achiev-
able if emission controls are rigorously enforced. For estimation,
50 percent reduction was used for cold cleaners and 60 percent
for open top vapor and conveyorized degreasers.
Exhibit 11-10, following Exhibit 11-9, presents the estimated
current emissions from solvent metal degreasing and the expected
emissions if the B methods of control are implemented for metal
cleaners and proposed exemptions for size and type of solvent are
implemented. As shown, emissions are expected to be reduced from
about 51,400 short tons per year to a total of 39,000 short tons
per year. The major portion of these reduced emissions, 29,700
tons, are from solvent metal cleaners exempt from the proposed
RACT regulations either by size or by the nature of solvent used.
Implementation of the regulations will reduce emissions by 4,100
12,400 tons per year (51,400 minus 39,000).
11-19
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EXHIBIT 11-9
U.S. Environmental Protection Agency
AVERAGE UNIT EMISSION RATES AND EXPECTED
EMISSION REDUCTIONS
EMISSION RATES WITHOUT CONTROLS
Averaged Emission Rate
Type of Degreaser Per Unit (short tons/yr.)
Cold cleaners, batch3 0.33
Open top vapor degreaser 11.00
Conveyorized degreaser 29.70
PERCENT EMISSION REDUCTION EXPECTED WITH TYPE B CONTROLS
Percent Emission
Type of Degreaser Reduction Expected
Cold cleaner, batch
Low volatility solvents 53 ( + 20)
High volatility solvents 69 ( + 20)
Open top vapor degreaser 60 (+15)
Conveyorized degreaser 60 ( + 15)
iuDoes not include emissions from conveyorized-type cold cleaners which represent
about 15 percent of all Conveyorized cleaners.
Source: EPA-450/2-77-022, op. cit.
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EXHIBIT 11-10
U.S. Environmental Protection Agency
ESTIMATED CURRENT AND REDUCED EMISSIONS FROM
SOLVENT METAL CLEANING IN ILLINOIS13
Type of Cleaner
Open top vapor
Conveyorized
Cold
Estimated
Current
Emissions
16,100
9,600
25,700
Estimated
from Nonexempt
Cleaners After
RACT
2,900
3,300
3,100
Estimated
Emissions From
Exempt Cleaners
After RACTa
8,800
1,400
19,500
Estimated
Total
Emissions
After RACTa
11,700
4,700
22,600
Total
51,400
9,300
29,700
39,000
a. Includes emissions from cleaners exempt by size or using 1,1,1-trichloroethane or Freon 113
b. All numbers rounded to nearest 100 tons/year
Source; Booz, Allen 6 Hamilton Inc.
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11.4 ESTIMATED COSTS OF RACT IMPLEMENTATION
As discussed in Section 11.1.6, compliance costs are based
upon EPA estimates of the costs and savings of various retro-
fitted methods of control. These estimates are summarized in
Exhibits 11-11 and 11-12, on the following pages.
Costs of implementation of the RACT regulations are summar-
ized in Exhibits 11-13, 11-14 and 11-15, on the assumption
that control methods B are used to maximize emission reduction
on nonexempt cleaners. Exhibits 11-16, 11-17, and 11-18
summarize the number and type of controls needed by cleaner
type as determined from interviews with cleaner manufacturers.
Total expenditures for all cleaners, vapor and cold types,
are estimated to be about $10.2 million in capital and about
$0.9 million in net annualized costs. The low net annualized
costs result primarily from the savings in solvent use which
the regulations are expected to provide.
In no case are the regulations expected to present a finan-
cial burden to individual firms. The largest single expenditure
would be for retrofitting a monorail conveyorized degreaser with
chiller, switches, drying tunnel, reduced openings and downtime
covers. Total cost for an average-sized degreaser of about
3.8-square-meters area would be less than $12,500. A large
unit, 14 square meters, would cost about $27,000 to $30, 000.-1
Since these conveyorized systems would only be used in large
plants with large sales volumes, this implementation costs is not
expected to present a hardship to any particular firm.
1
Based on a six-tenths cost scale factor.
11-20
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EXHIBIT 11-11
U.S. Environmental Protection Agency
CONTROL COSTS FOR COLD CLEANER
WITH 5.25 ft.2 AREA
Item
Installed capital ($)
Direct operating costs ($/yr.)
Capital charges ($/yr.)c
Solvent cost (credit) ($/yr.)
Annualized cost (credit) ($/yr.)
Low Volatility
Solvent5
25.00
1.00
4.30
(4.80)
0.50
High Volatility
Solventb
365.00
2.6
91.25
(39.36)
54.49
a. Costs include only a drainage facility for low volatility solvents,
b. Includes $65 for drainage facility, a mechanically assisted cover,
and extension of freeboard.
c. Capital charges used in study estimate were 25 percent of capital
instead of 17 percent used in EPA report.
Source; EPA-450/2-77-022, op. cit.
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EXHIBIT 11-12
U.S. Environmental Protection Agency
CONTROL COSTS FOR AVERAGE-SIZED
OPEN TOP VAPOR AND CONVEYORIZED CLEANERS
1. CONTROL COSTS FOR TYPICAL SIZE OPEN TOP VAPOR DEGREASER
(Vapor to Air Area of 1.67 m^)
Control Technique
Installed capital ($)
Direct operating
cost ($/yr.)
Capital charges ($/yr.)b
Solvent cost (credit)
(S/yr.)
Net annualized cost
(credit) ($/yr.)
Manual
Cover
300
10
75
(860)
(775)
Carbon
Adsorption3
10,300
451
2,575
(1,419)
1,607
Refrigerated
Chiller
6,500
259
1,625
(1,290)
594
Extended Freeboard
& Powered Cover
8,000
100
2,000
(1,161)
939
2. CONTROL COSTS FOR TYPICAL CONVEYORIZED DEGREASERS
(Vapor to Air Vapor Area of 3.8 m^)
Monorail Degreaser
Crossrod Degreaser
Control Technique
Installed capital ($)
Direct operating
costs ($/yr.)
Capital charges ($/yr.)k
Solvent cost (credit)
(S/yr.)
Annualized cost (credit)
($/yr.)
Carbona
Adsorber
17,600
970
4,400
(5,633)
(263)
Refrigerated
Chiller
8,550
430
2,138
(5,633)
(3,065)
Carbona
Adsorber
17,600
754
4,400
(2,258)
2,896
Refrigerated
Chiller
7,460
334
1,865
(2,258)
(59)
a. Not used in cost estimates since net annualized costs for carbon absorption
are the highest for any control method.
b. Capital charges used in study estimate were 25 percent of capital instead of
17 percent used by EPA source.
Source; EPA 450/2-77-022, op. cit.
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EXHIBIT 11-13
U.S. Environmental Protection Agency
ESTIMATED CONTROL COSTS FOR COLD CLEANERS
FOR THE STATE OF ILLINOIS
1. CAPITAL COSTS
Item
Number of Degreasers
Needing Conversion
Costs
a
Capital
12,720
$4,320,000
2.
ANNUALIZED COSTS
Item
Direct operating costs
Capital charges
Solvent cost (credit)
Net annualized costs
Costs
$ 31,500
1,080,000
(468,000)
$ 463,500
a. It was assumed that all solvents used in cold cleaners meet
specifications as outlined for high volatility solvents.
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 11-14
U.S. Environmental Protection Agency
ESTIMATED COSTROL COSTS FOR OPEN TOP
VAPOR DEGREASERS FOR THE STATE OF ILLINOIS
1. CAPITAL COSTS
Item
Safety switches
Powered covers
Manual covers
Total
Costs
$ 13,300
3,333,000
55,100
$3,401,400
2.
ANNUALIZED COSTS
Item
Direct operating costs
Capital charges
Solvent cost (credit)
Net annualized costs
$ 255,600
Source; Booz, Allen & Hamilton Inc.
-------
EXHIBIT 11-15
U.S. Environmental Protection Agency
ESTIMATED CONTROL COSTS FOR CONVEYORIZED
DEGREASERS FOR THE STATE OF ILLINOIS
1. CAPITAL COSTS
Item
Refrigerator chillers
Monorail degreasers
Crossrod degreasers
Safety switches
Drying tunnel
Reduce openings
Downtime covers
Total
Costs
$ 865,300
1,118,500
13,800
70,000
250,000
75,000
$2,392,600
ANNUALIZED COSTS
Item
Direct operating costs
Capital charges
Solvent cost (credit)
Net annualized cost
Costs
$ 468,100
598,100
(902,000)
$ 164,200
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 11-16
U.S. Environmental Protection Agency
ESTIMATED NUMBER OF COLD CLEANERS
NEEDING CONTROLS IN THE STATE
OF ILLINOIS
Percent of Number of Cleaners3
Type of Control Cleaners Needing Control Needing Control
Drainage facility 5 940
Freeboard and 63 11,780
drainage0
a. Numbers rounded to nearest 10 units.
b. Based on 10 percent of cleaners using low volatility solvents
and half of these needing drainage facilities.
c. Based on 90 percent of cleaners using high volatility solvents
and 70 percent of these needing additional freeboard and
drainage.
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 11-17
U.S. Environmental Protection Agency
ESTIMATED NUMBER OF OPEN TOP VAPOR
DEGREASERS NEEDING CONTROL IN THE
STATE OF ILLINOIS
Percent of Number of Cleaners
Type of Control Cleaners Needing Control Needing Control
Manual covers 30 200
Safety switches 20 133
Powered cover 60 400
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 11-18
U.S. Environmental Protection Agency
ESTIMATED NUMBER OF CONVEYORIZED
DEGREASERS NEEDING CONTROLS
IN THE STATE OF ILLINOIS
Percent of Cleaners Number of Cleaners
Type of Control Needing Control Needing Control
Refrigerated chillers for 36 100
monorail and miscel-
laneous type cleaners3
Refrigerated chillers for 54 150
crossrod type cleaners
Safety switches 20 55
Drying tunnel 10 28
Minimized openings 90 250
Downtime covers 90 250
a. Refrigerated chillers were estimated to be needed only on
about 90 percent of all conveyorized vapor degreasers; thus,
the percent of units needed by monorail-miscellaneous and
crossrod types add only to 90 percent.
Source; Booz, Allen & Hamilton Inc.
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11.5 DIRECT ECONOMIC IMPLICATIONS
11.5.1 Time Required to Implement Proposed RACT Regulations
Because so many degreasers are affected under the
proposed regulation (667 open top vapor degreasers, 277
conveyorized degreasers and 18,700 cold cleaners in Illinois
alone) and because each requires retrofitting of a control
device, some users may not be able to comply within proposed
compliance schedules because of equipment availability. J-
Discussions with personnel from the major manufacturers of
vapor and cold degreasers reveal that none are prepared to
provide the necessary controls in quantities to meet a
cumulative U.S.-wide demand. Some cleaners could be con-
verted to 1,1,1-trichloroethane and thus become exempt. In
fact, many metal solvent cleaners have been converted to
trichloroethane in the last few years in anticipation of
RACT regulations. However, not all existing machines can be
converted because of inadequate condensing sections or
improper materials of construction. Trichloroethane can be
extremely corrosive if stabilizers are insufficiently reple^
nished. In fact, stainless steel vapor degreasers using
1,1,1-trichloroethane have been reported to fail because of
corrosion following the loss of stabilizer.
11.5.2 Effect of Compliance upon Selected Economic Indicators
Implementation of the proposed regulations are expected
to have a negligible effect on factors such as value of
shipments, prices, capital investment or the state economy
as a whole, because of the low total capital and annual
operating costs required by solvent metal cleaner owners.
For example, total shipments in SIC groups 25 and 33-39
alone exceeded $39.3 billion in 1975 and are expected to
exceed $45 billion in 1978. Total capital expenditures for
retrofitting are estimated to amount to less than 0.01
percent of this; annualized costs are estimated to be less
than 0.004 percent, including a slight drop in productivity
because of work practice modifications.
1
Based on comments by several degreasing equipment manufacturers
who have not geared up production for potential demands created
by implementation of RACT guidelines.
11-21
-------
Similarly, implementation is expected to have a neg-
ligible impact on total capital expenditures, which amounted
to about $1.5 billion in 1975. Since it appears that com-
pliance may require several years in practice, average
capital expenditures will be about $2.0 million to $2.5 million
per year and would be about 0.2 percent or less of normal
capital expenditures for plants in these SIC groups. Con-
sidering that these expenditures are spread over service
industries, and other industries also not included in SICs
25 and 33-39, the overall economic impact is even less
significant.
Implementation of the regulations will reduce demand
for metal cleaning solvents. At an average price of 15 cents
per pound (mineral spirits are about 10 cents per pound;
chlorinated solvents are about 20 cents per pound), this would
result in a reduction in solvent sales of about $3.6 million
annually, based on a reduction in emissions of 12,400 tons
per year, as summarized in Exhibit 11-10, following page 11-19.
This may result in a loss of employment for firms supplying
metal cleaning solvents.
11.5.3 Effect of Compliance upon Energy Consumption
Carbon adsorbers, refrigerated chillers and distillation units
are the principal energy consuming control devices used for
controlling degreasing emissions. The refrigerated chiller, which
would probably be the preferred method of control because of its
low capital and operating costs, will increase a degreaser's
energy consumption by about 5 percent. The EPA has estimated
consumption of 0.2 kw to 2.2 kw by a chiller, used on a typical
open top vapor degreaser of 1.7m2 size.2 For a typical conveyorized
degreaser of about 3.8nr size, consumption is estimated, on this
basis, to be 0.5 kw to 5.0 kw. Only conveyorized degreasers are
expected to use chillers to comply; and about 90 percent or 250
of these currently do not have chillers. Assuming 2,250 hours
per year operation, total additional energy consumption annually
would be about 280,000 kw-hours to 2,800,000 kw-hours. This is
equal to $11,200 to $112,000 per year in additional power costs,
at a cost of $0.04 per kw-hour. Most of this cost is recovered
by savings in solvent use.
1
Data from 1976 Census of Manufactures, for average capital
expenditures per employee in these SIC groups, were used in
conjunction with County Business Patterns data to estimate
these values.
2
EPA-450/2-77-022, op. cit.
11-22
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11.6 SELECTED SECONDARY ECONOMIC IMPACTS
Implementation is also expected to have minor, if not negligible,
impact upon other factors, such as employment, market structure and
productivity. The proposed regulations include some change in work
practices which will decrease productivity in the metal cleaning
operation by 5 percent to 10 percent. Since metal cleaning is nor-
mally a minor step in the manufacturing or service process, any
change in productivity and employment in user plants will be insig-
nificant.
There will, however, be some temporary increase in employment
by those firms manufacturing such components as refrigeration chillers
and drying tunnels, that may be required for retrofit controls. No
estimates have been made because manufacturers of such components
are located throughout the country. This temporary increase
however, may be balanced by a slight decrease in employment
occurring because of lower solvent consumption. The decrease
would occur primarily in shipping and repackaging operations.
The implementation of the RACT guidelines should not have
any major effect on the current market structure of the industries
using solvent metal cleaning. Cleaners requiring highest retro-
fitting costs (i.e., for conveyorized cleaners) are generally
owned by large firms. Smaller firms would be expected to have
only cold cleaners or open top vapor degreasers. The highest
capital costs would be for an open top unit which would require
an expenditure of $8,000 or less to comply. This is not expected
to be a significant financial burden even to small-sized firms.
Exhibit 11-19, on the following page, summarizes the con-
clusions presented in this report.
11-23
-------
EXHIBIT 11-19
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SOLVENT METAL DECREASING
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
1977 VOC emissions (actual)
Industry preferred method of VOC
control to meet RACT guidelines
Assumed method of VOC control
meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market Structure
RACT timing requirements (1982)
Problem Areas
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
About 20,000 plants
Value of shipments of firms in SIC groups af-
fected is in the range of $40 billion, about
one-half of the state's 1977 value of shipments
Where technically feasible, firms are sub-
stituting exempt solvents
51,400 tons/year
Substitution. Otherwise lowest cost option
as specified by EPA will be used.
Equipment modifications as specified by the
RACT guidelines
Discussion
$10.6 million
$0.9 million, (less than 0.01 percent of the
1977 statewide value of shipments)
Metal cleaning is only a fraction of manu-
facturing costs? price effect expected to
be less than 0.01 percent
Less than 1,500 equivalent barrels of oil
per year increase
5-10 percent decrease for manually operated
degreasers. Will not effect conveyorized
cleaners.
No effect except a possible slight decrease
in firms supplying metal degreasing solvents
No change
Equipment availability—only a few companies
now supply the recommended control modifications
No significant problem areas seen
39,000 tons/year (76 percent of 1977 VOC emissic
level—however, this does not include emission
controls for exempt solvents)
$73 annualized cost per ton of emissions reduced
Source; Booz, Allen & Hamilton Inc.
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BIBLIOGRAPHY
U.S. Department of Commerce, County Business Patterns,
1976.
U.S. Department of Commerce, Census of Manufactures,
1972.
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Solvent Metal Cleaning EPA-450/2-
77-022, November 1977.
U.S. Environmental Protection Agency, Regulatory Guidance
for Control of Volatile Organic Emissions from 15 Categories
of Stationary Sources EPA-905/2-78-001, April 1978.
Dow Chemical Company, Study to Support New Source Performance
Standards for Solvent Metal Cleaning Operations EPA Contract
68-02-1329, June 30, 1976.
Private conversations with the following:
De.trex Chemical Company, Detroit, Michigan
Ethyl Corporation, Baton Rouge, Louisiana
DuPont, Wilmington, Delaware
Dow Chemical Company, Midland, Michigan
PPG, Pittsburgh, Pennsylvania
Allied Chemical Company, Morristown, New Jersey
R. R. Street, Detroit, Michigan
Baron-Blakeslee Corporation, Cicero, Illinois
Hercules Inc., Wilmington, Delaware
Texas Eastman, Longview, Texas
-------
12.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR CONTROL OF REFINERY VACUUM
PRODUCING SYSTEMS, WASTEWATER SEPARATORS
AND PROCESS UNIT TURNAROUNDS IN THE
STATE OF ILLINOIS
-------
-------
12.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR CONTROL OF REFINERY VACUUM
PRODUCING SYSTEMS, WASTEWATER
SEPARATORS AND PROCESS UNIT TURNAROUNDS
IN THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT controls of refinery vacuum producing
systems, wastewater separators and process unit turnarounds
in the State of Illinois. The chapter is divided into six
sections including:
Specific methodology and quality of estimates
Industry statistics
The technical situation of the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic implications
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of
refineries, interviews and analysis.
12-1
-------
12.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for control of refinery vacuum producing systems, wastewater
separators and process unit turnarounds in the State of Illinois,
An overall assessment of the quality of the estimates
is detailed in the latter part of this section.
12.1.1 Industry Statistics
Industry statistics on refineries were obtained from
several sources. All data were converted to a base year,
1977, based on the following methodologies:
The number of refineries for 1977 was obtained
from the Oil and Gas Journal, March 20, 1978
and the American Petroleum Institute.
The number of employees in 1977 was estimated
based on data from the County Business Patterns,
Department of Commerce, 1976.
The output in barrels per day of refined petroleum
liquids was estimated based on data supplied by the
American Petroleum Institute for 1977.
Value of shipments was estimated based on a value
of refined product of $13.95 per barrel. This
price was obtained from the National Petroleum
News Fact Book, 1977.
Capital expenditures were estimated based on data
from the Chase Manhattan Bank.
12-2
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12.1.2 VOC Emissions
Uncontrolled emissions from wastewater separators and
process unit turnarounds were estimated using factors from
Control of Refining Vacuum Producing Systems, Wastewater
Separators and Process Unit Turnarounds, EPA-450/2-77-025.
Uncontrolled emissions from vacuum producing systems were
estimated using Revision of Evaporative Hydrocarbon Emission
Factors, EPA-450/3-76-039.Emissions at existing levels of
control were estimated using data supplied by the Illinois
Environmental Protection Agency. Emissions at complete
control were estimated based on percent recoveries estimated
in Control of Refinery Vacuum Producing Systems, Wastewater
Separators and Process Unit Turnarounds, EPA-450/2-77-025.
12.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions from refinery
vacuum producing systems, wastewater separators and process
unit turnarounds are described in Control of Refinery Vacuum
Producing Systems, Wastewater Separators and Process Unit
Turnarounds, EPA-450/2-77-025.These data provide
the alternatives available for controlling VOC emissions from
these refinery operations. Several studies of VOC emission
control were also analyzed in detail; and petroleum trade
associations, refinery operators and vapor control equipment
manufacturers were interviewed to ascertain the most likely
types of control processes which would be used in refineries
in Illinois. The specific studies analyzed were: Technical
Support Document Petroleum Refinery Sources, Illinois
Environmental Protection Agency; Human Exposures to
Atmospheric Emissions from Refineries/ American Petroleum
Institute, July 1973; and Economic Impact of EPA's Regulations
on the Petroleum Refining Industry.
The alternative types of vapor control equipment likely
to be applied to refinery vacuum producing systems, waste-
water separators and process unit turnarounds were described,
and percentage reductions from using each type of control
were determined. The methodology for the cost analysis based
on this scheme is described in the following paragraphs.
12-3
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12.1.4 Cost of Vapor Control Systems
The costs of vapor control systems were developed by:
Determining the alternative types of control
systems likely to be used
Developing installed capital costs for each control
system
Aggregating applicable installed capital costs to
the refineries in the state
Developing additional costs including:
Direct operating costs
Annual capital charges
- Petroleum credit
Net annual cost.
Costs were determined from analyses of the following
previous studies:
Control of Refinery Vacuum Producing Systems,
Wastewater Separators and Process Unit Turnarounds/
EPA 450/2-77-025
Hydrocarbon Emissions from Refineries, American
Petroleum Institute, October 1977
and from interviews with petroleum marketers' associations,
refinery operators, major oil companies and vapor control
equipment manufacturers.
The assignment of the estimated cost of control for
refineries in Illinois required knowledge of the level of
current controls, the number of refineries and characteris-
tics of uncontrolled refinery processes. These data were
provided by the Illinois Environmental Protection Agency.
It is estimated that all of the 12 refineries in Illinois
would currently comply with RACT requirements except at five
refineries for uncovered wastewater separators.
12.1.5 Economic Impacts .
The economic impacts were determined by analyzing_the
leadtime requirements needed to implement RACT; assessing
the feasibility of instituting RACT controls in terms of
capital availability and equipment availability; comparing
12-4
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the direct costs of RACT control to various state economic
indicators; and assessing the secondary effects on market
structure, employment and productivity as a result of im-
plementing RACT controls in Illinois.
12.1.6 Quality of Estimates
Several sources of information were utilized in
assessing the emissions, cost, and economic impact of
implementing RACT controls on selected refinery operations
in Illinois. A rating scheme is presented in this section
to indicate the quality of the data available for use in
this study. A rating of "A" indicates hard data (i.e.,
data that are published for the base year); "B" indicates
data that were extrapolated from hard data; and "C"
indicates data that were not available in secondary
literature and were estimated based on interviews, analyses
of previous studies and best engineering judgment.
Exhibit 12-1, on the following page, rates each study output
listed and the overall quality of the data.
12-5
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Exhibit 12-1
U.S. Environmental Protection Agency
DATA QUALITY
B C
A Extrapolated Estimated
Study Outputs Hard Data Data Data
Industry statistics
,Emissions
Cost of emissions
control
Statewide costs of
control
Economic impact
Overall quality of
data
Source; Booz, Allen & Hamilton, Inc.
-------
12.2 INDUSTRY STATISTICS
Industry facilities, statistics and business trends
for refineries in Illinois are presented in this section.
The discussion includes a description of the facilities
and their characteristics, a comparison of the size of the
refining industry to state economic indicators, a historical
characterization and description of the industry and an
assessment of future industry patterns. Data in this
section form the basis for assessing the impact on this
industry of implementing RACT to VOC emissions from selected
refinery operations.
12.2.1 Size of the Industry
There are 12 refineries in Illinois, each listed in
Exhibit 12-2, on the following page, along with location,
crude capacity and vacuum distillation capacity. The
statewide employment, output, value of shipments and capital
expenditures for Illinois refineries are displayed in
Exhibit 12-3, following Exhibit 12-2.
12.2.2 Comparison of the Industry to the State Economy
In this section, the refining industry is compared to
the economy of the State of Illinois by comparing industry
statistics to state economic indicators. Employees in the
refining industry represent 0.1 percent of the total state
civilian labor force of Illinois. The value of refined
products from Illinois refineries represents approximately
15 percent of the total value of wholesale trade in Illinois
in 1977.
12.2.3 Industry Trends
Petroleum refining is the third largest industry in
the United States. Until the 1970s the output of the
refining industry had grown at a steady rate. Currently,
approximately 280 refineries are owned by approximately
140 firms, located in 40 of the 50 states, Guam, Puerto
Rico and the Virgin'.Islands. The refining industry
manufactures hundreds of distinguishably different products,
which may be grouped into four broad product classes:
gasoline, middle distillates, residual and other.
The bulk of refining is done by firms which also market
refined products or produce crude oil, or both.
12-6
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Exhibit 12-2
U.S. Environmental Protection Agency
PETROLEUM REFINERIES IN ILLINOIS
Name of Firm
Amoco Oil Company
Clark Oil & Refining Corp
Marathon Oil Corp
M. T. Richards Inc.
Mobil Oil Corp
Shell Oil Co.
Texaco, Inc.
Union Oil Company of California
Wireback Oil Co., Inc.
Yetter Oil Co.
TOTAL
Location
Wood River
Blue Island
Hartford
Joliet (Robinson)
Crossville
Joliet
Wood River
Lawrenceville
lockport
Lemont
Plymouth
Colmar
Crude Capacity
(000 barrels per day)
95
70
55
205
0.7
200
295
88
76
159
2
1
Vacuum
Distillation
Capacity
(000 barrels per day)
36
27
18
62
88
95
24
14
55
1,246.7
420
Source; Qil S Gas Journal, March 20, 1978, pp. 108-130, and American Petroleum Institute
-------
Exhibit 12-3
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR
REFINERIES IN ILLINOIS
Establishments
Employees
Output
(000, barrels
per day)
Yearly
Value of
Shipments
($ Million, 1977)
Yearly
Capital
Expenditures
($ Million, 1977)
12
6,300
1,190
6,100
190
a. Estimated by Booz, Allen fi Hamilton Inc., based on County Business Patterns (Department of Commerce),
in 1976.
b. Baaed on data supplied by the American Petroleum Institute for 1977.
c. Assumes a value of $13.95 per barrel as average for 1977 (source: National Petroleum News
Factbook, 1977).
d. Assumes capital expenditures in 1976 in the state were the same percent of the total U.S.
expenditure on refineries as in 1977. Data for 1976 supplied by the Chase
Manhattan Bank.
-------
Foreign, Federal, state and local governments all
influence the oil product market in terms of taxes,
price controls, tariffs on imports of crude oil and products.
Foreign crude oil price had, until 1973, been lower than
prices for domestic crude oil. Since the advent of the OPEC
cartel in 1975, imported crude oil prices have risen
sharply.
The most modern refinery in Illinois is the Mobil
Oil Refinery in Joliet, which was built in the early 1970s.
12-7
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12.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents information on refinery operation,
estimated VOC emissions from selected refinery operations
in Illinois, the extent of current control in use, the
requirements of vapor control under RACT and the likely
RACT alternatives which may be used for controlling VOC
emissions from selected refinery operations in Illinois.
i
12,3.1 Refinery Operations
The refinery operations considered in this report are:
Vacuum producing systems
Wastewater separators
Process unit turnarounds.
The emissions from these sources vary from one petroleum
refinery to another depending on such factors as refinery
size and age, crude type, processing complexity, application
of control measures.and degree of maintenance.
12.3.2 Vacuum Producing Systems
Crude oil is a mixture of many different hydrocarbon
compounds. These compounds are distinguished by their
hydrocarbon type and by their normal boiling temperatures.
In crude oil refining, the first processing step is the
physical separation of the crude oil into different fractions
of specific boiling temperature ranges. This separation is
performed in the atmospheric distillation unit and in the
vacuum distillation unit.
Vacuum distillation receives its name from the sub-
atmospheric operating pressure of the fractionation tower(s)
employed. The vacuum distillation separates heavy petroleum
distillates from reduced crude (atmospheric distillation tower
bottoms). Vacuum fractionation with steam stripping is
employed to avoid excessive temperatures that would be
encountered in producing these heavy distillates by atmospheric
fractionation. .
In the vacuum distillation process reduced crude is
first heated in a direct-fired furnace to a predetermined
temperature of approximately 730°F-770°F. The hot oil is
then charged to the vacuum producing' unit for separation of
distillates from the charge stock. Vacuum residuum is
12-8
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recovered as the fractionator's bottoms product. Vacuum
fractionators are maintained at approximately lOOmmHg
absolute pressure by one of the following:
Steam ejectors with contact condensers
Steam ejectors with surface condensers
Mechanical pumps.
12.3.2.1 Steam Ejectors with Contact Condensers
Direct contact or barometric condensers are used for
maintaining a vacuum by condensing the steam used in the
ejector jet plus steam removed from the distillation column.
In the contact condenser, condensable VOC and steam from
the vacuum still and the jet ejectors are condensed by
intimately mixing with cold water. The noncondensable
VOC is frequently discharged to the atmosphere. A two-stage
steam jet ejector is shown in Exhibit 12-4, on the following
page, and a three-stage ejector with a booster is shown
in Exhibit 12-5, following Exhibit 12-4. These are
typical of vacuum producing systems used in existing refineries,
12.3.2.2 Steam Ejectors with Surface Condensers
Modern refiners prefer surface condensers to contact
condensers. In a surface condenser, noncondensables and
process steam from the vacuum still, mixed with steam
from the jets, are condensed by cooling water in tube heat
exchangers and thus do not come in contract with cooling
water. This is a major advantage since it reduces by
25-fold the quantity of emulsified wastewater that must
be treated. A disadvantage of surface condensers is their
greater initial investment and maintenance expense for
the heat exchangers and additional cooling tower capacity
necessary for the cooling water.
12.3.2.3 Mechanical Vacuum Pumps
Steam jets have been traditionally favored over vacuum
pumps. Recently, however, because of high energy costs for
generating steam and the cost for disposing of wastewater
from contact condensers, vacuum pumps are being used. In
addition to energy savings, vacuum pumps have fewer cooling
and/or wastewater treatment requirements compared to steam
ejector systems. Aside from the stripping steam, the ejected
stream is essentially all hydrocarbon, so it ban be vented
through a small condenser before being combusted in a flare
or sent to the refinery fuel gas system.
12-9
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_ _ . Exibit 12-4
u.b. Environmental Protection Agency
VACUUM PRODUCING SYSTEM UTILIZING
A TWO-STAGE CONTACT CONDENSER
CONDENSER WATER
INCOMING
NONCONDENSABLES
AND PROCESS
STEAM
"BAROMETRIC LEG V
rh
BAROMETRIC
CONDENSERS
T JET STEAM
2nd STAGE
t
TO ATMOSPHERE
OR TO A
CONDENSER FOR
JET STEAM
HOT WELL
Source: Control of Refinery Vacuum Producing Systems,
Wastewater Separators and Process Unit Turnarounds,
EPA-450/2-77-025.
-------
Exhibit 12-5
U.S. Environmental Protection Agency
VACUUM PRODUCING SYSTEM UTILIZING
BOOSTER EJECTOR FOR LOW-VACUUM SYSTEMS
JET STEAM
i
CONDENSER WATER
3rd STAGE
INCOMING
NONCONDENSABLES
AND PROCESS STEAM
T
TO ATMOSPHERE
OR A CONDENSER
OR TO OTHER
NONCONDENS1NG
STAGES
BAROMETRIC LEG
H HOT WELL
Source; Control of Refinery Vacuum Producing Systems,•
Wastewater Separators and Process Unit Turnarounds,
EPA-450/2-77-025.
-------
12.3.3 Wastevater Separators
Contaminated wastewater originates from several sources
in petroleum refineries including, but not limited to, leaks,
spills, pump and compressor seal cooling and flushing,
sampling, equipment cleaning, and rain runoff. Contaminated
wastewater is collected in the process drain system and
directed to the refinery treatment system where oil is
skimmed in a separator and the wastewater undergoes additional
treatment as required.
Refinery drains and treatment facilities are a source
of emissions because of the evaporation of VOC contained in waste-
water. VOC will be emitted wherever wastewater is exposed
to the atmosphere. As such, emission points include open
drains and drainage ditches, manholes, sewer outfalls, and
surfaces of forebays, separators and treatment ponds. Because
of the safety hazards associated with hydrocarbon-air mix-
tures in refinery atmospheres, current refinery practice
is to seal sewer openings and use liquid traps downstream
of process drains, thus minimizing VOC emissions from drains
and sewers within the refinery.
12.3.4 Process Unit Turnarounds
Refinery units,such as reactors and fractionators,
are periodically shut down and emptied for internal inspec-
tion, and start-up is termed a unit turnaround. Purging
the contents of a vessel to provide a safe interior
atmosphere for workmen is termed a vessel blowdown. In a
typical process unit turnaround, liquid contents are pumped
from the vessel to some available storage facility. The
vessel is then depressurized, flushed with water, steam,
or nitrogen and ventilated. Depending on the refinery
configuration, vapor content of the vessel may be vented
to a fuel gas system, flared or released directly to
atmosphere. When vapors are released directly to the atmosphere,
it is through a blowdown stack which is usually remotely
located to ensure that combustible mixtures will not be
released within the refinery.
12.3.5 Emissions and Current Controls
This section presents the estimated VOC emissions from
selected refinery operations in Illinois in 1977 and the
estimated current level of emission control already implemented
in the state. Exhibit 12-6, on the following page, shows total
12-10
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Exibit 12-6
U.S. Environmental Protection Agoncy
ESTIMATED HYDROCARBON EMISSIONS EROM
SELECTED REFINERY OPERATIONS IN ILLINOIS
Estimated Hydrocarbon Emissions (TPY)
State
Illinois
Number of
Refineries
12
Without
Control
Vacuum Producing Systems
Wastewater Separators
Process Unit Turnarounds
4,093
18,191
131,900
154,184
At Estimated
Existinq Level of
Control
Negligible
7,583
Negligible
7,583
At Complete
Control0
Negligible
Negligible
Negligible
Negligible
a.
b.
c.
Emissions are estimated using factors from Control of Refining Vacuum Producing Systems, Wastewater
Separators and Process Unit Turnarounds, EPA-450/2-77-025. Emissions from vacuum producing systems
were estimated using Revision of Evaporative Hydrocarbon Emission Factors, EPA-450/3-76-039.
Current level of emissions was estimated using data supplied by the State of Illinois. Emissions
from wastewater separators for the five refineries with uncovered wastewater separators are
estimated to be 40 percent of the emissions calculated using U.S. EPA emission factors, since the
vapor pressure is approximately 0.4 psi.
Assumes the percent recoveries estimated in Control of Refinery Vacuum Producing Systems, Wastewater
Separators and Process Unit Turnarounds.
Source; Booz, Allen & Hamilton Inc.
-------
estimated emissions from the 12 refineries in Illinois,
if there were no emission controls for vacuum producing
units, wastewater separators or process unit turnarounds.
The emissions at the existing level of control are also
shown, along with estimated emissions at the complete level
of control.
In Illinois, refineries have already implemented
control measures for vacuum producing units, for process unit
turnarounds and for more than half of the wastewater
separators. Five wastewater separators at refineries in
Illinois are presently not covered.
Emissions were estimated based on EPA emission factors
reported by U.S. EPA. The EPA is currently updating emission
factors based on a new analysis of previous test data. EPA
reports the emission factors may change as a result of
their ongoing program; therefore, caution must be exercised
in using these uncertain emission factors in Illinois.
12.3.6 RACT Guidelines
The RACT guidelines for VOC emission control from
vacuum producing systems, wastewater separators and process
unit turnarounds require the following control systems:
Vacuum producing units—The control measure
for vacuum producing units is to vent the non-
condensable hydrocarbon stream to a flare or to
the refinery fuel gas system.
Wastewater separators—The control measure for
emissions from wastewater separators is to cover
the separators. Emissions are collected and sent
to the flare or refinery fuel gas system.
Process unit turnarounds—Process unit turnaround
emissions are controlled by piping emissions to a
flare or to the refinery fuel gas system.
Proper operation and maintenance of equipment will also
reduce emissions from cracks and leaks in the system.
12.3.7 Selection of the Most Likely PACT Alternative
The techniques for the control of VOC emissions from
refinery vacuum producing systems, wastewater separators
and process unit turnarounds are discussed in detail in
this section.
12-11
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12.3.7.1 Controlling Emissions from Vacuum Producing Units
Steam ejectors with contact condensers, steam ejectors
with surface condensers and mechanical vacuum pumps all
discharge a stream of noncondensable VOC while generating
the vacuum. Steam ejectors with contact condensers also
have potential VOC emissions from their hot wells. VOC
emissions from vacuum producing systems can be prevented
by piping the noncondensable vapors to an appropriate
firebox or incinerator or (if spare compressor capability
is available) by compressing the vapors and adding them to
refinery fuel gas. The hot wells associated with contact
condensers can be covered and the vapors incinerated.
Controlling vacuum producing systems in this manner will
result in negligible emissions of hydrocarbons from this
source. Such systems are now in commercial operation
and have been retrofitted in existing refineries. For
purposes of this report it is assumed that recovered VOCs
are used in the refinery fuel gas system.
12.3.7.2 Controlling Emissions from Wastewater Separators
Reasonable control of VOC emissions from wastewater
separators consists of covering the forebays and separator
sections, thus minimizing the amount of oily water exposed
to the atmosphere. Commercially operating systems include
a solid cover with all openings sealed, totally enclosing
the compartment liquid contents, or a floating pontoon or
double-deck type cover, equipped with closure seals to
enclose any space between the cover's edge and compartment
wall. Also, any gauging and sampling device in the com-
partment cover can be designed to provide a projection
into the liquid surface to prevent VOC from escaping. The
sampling device can also be equipped with a cover or lid
that is closed at all times except when the device is in
actual use. It is assumed that these emissions are not
recovered and are flared.
12.3.7.3 Controlling Emissions from Process Unit Turnaround
A typical process unit turnaround would include
pumping the liquid contents to storage, purging the vapors
by depressurizing, flushing the remaining vapors with water,
steam or nitrogen, and ventilating the vessel so workmen
can enter. The major potential source of VOC emissions is
in depressurizing the vapors to the atmosphere. After the
vapors pass through a knockout pot to remove the condensable
hydrocarbons, the vapors can be added to the fuel gas system,
flared or directly vented to the atmosphere. It is assumed
12-12
-------
that no VOC emissions are recovered and used in the
refinery fuel gas system.
The sections which follow discuss the costs of imple-
menting these control techniques at refineries in Illinois,
12-13
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12.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATION_S
FOR THE MOST LIKELY RACT ALTERNATIVES
Costs for VOC emission control equipment are presented
in this section. The costs for the three emission control
systems described in Section 12.3 are described for vacuum
producing systems, wastewater separators and process unit
turnarounds individually, followed by an extrapolation of
costs for the remaining five uncovered wastewater separators
to the statewide industry.
12.4.1 Costs for Emission Control Systems
The installed capital costs for the three emission
control systems (summarized in Exhibit 12-7, on the following
page) were derived from analysis of the RACT guidelines, from
interviews with refinery operators and major oil companies
and from previous cost and economic studies of refineries.
Control measures for vacuum producing systems, at a
typical 100,000 barrel per day capacity refinery, range in
costs from approximately $24,000 for vacuum producing systems
using either surface condensers or mechanical pumps to
$52,000 for vacuum producing systems using contact (baro-
metric) condensers. These cost estimates are based on the
refinery requiring the following equipment.
For vacuum producing systems using other surface
condensers or mechanical pumps, typical equipment
includes:
200 feet of piping
6 valves
1 flame arrester.
For vacuum producing systems using contact
(barometric) condensers, typical equipment includes:
400 feet of piping
12 valves
2 flame arrestors
Hotwell cover area of 100 feet.
Control of wastewater separators using covers can range
from $30 per square foot to $2,000 per square foot, depending
upon the types of covers used.according to an interview with
Exxon. In Control of Refinery Vacuum Producing Systems, ^-Taste-
water Separators and Process Unit Turnarounds, the cost is $12.50
per square foot, which is a reasonable estimate if major rebuildin
is not required. This cost has been used in this report. Re-
fineries with old wastewater separators may be required to rebuild
the separators. Such costs have not been reflected in this report
because of lack of data. The estimated cost does not include any
product recovery equipment costs that could be required for a
system with recovery of vapors.
-------
Exhibit 2-7
U.S. Environmental Protection Agency
INSTALLED CAPITAL COSTS OF VAPOR CONTROL SY
FOR VACUUM PRODUCING SYSTEMS, WASTEWATE
SEPARATORS AND PROCESS
UNIT TURNAROUNDS
Vacuum Producing
Systems
Surface
Condensers Contact
or Mechanical Condensers
($, 1977) ($, 1977)
Wastewater
Separators
($, 1977)
Process Unit
Turnarounds
($, 1977)
24,000
52,000
63,000
100,000
Note: Capital costs are for a typical 100,000 barrel per day refinery.
a. Equipment includes 200 feet of piping, 6 valves and 1 flame
arrester.
*>• Equipment includes 400 feet of piping, 12 valves, 2 flame
arrestors, 100 ft.2 area hotwell cover.
c. Cover for 5,000 ft.^ wastewater separator.
d. Equipment includes 1,000 ft. of piping and 20 valves.
Source; Control of Refinery Vacuum Producing Systems, Wastewater
Separators and Process Unit Turnarounds, EPA 450/2-77-025,
pp. 4-10.
-------
Equipment required for controlling emissions from pro-
cess unit turnarounds basically includes piping and valves.
The installed capital costs for a typical 100,000 barrel
per day refinery would be in the range of $10,000 per pro-
cess unit; there are, on the average, ten process units for
a 100,000 barrel per day refinery.
Cost estimates obtained from Control of Refinery Vacuum
Producing Systems, Wastewater SepaFators and Process Unit~
Turnarounds, EPA-450/2-77-025 and verified through inter-
views will vary from one refinery to another, reflecting the
variability in refinery size, configuration, age, product mix
and degree of control.
In Illinois, the twelve refineries have already incurred
costs for control of vacuum producing systems, process unit
turnarounds and all but five wastewater separators.
The remainder of this section,therefore, presents the
costs for covering the five remaining wastewater separators.
12.4.2 Extrapolation to the Statewide Industry
Exhibit 12-8, on the following page, shows the extrap-
olation of vapor control, costs for covering five wastewater-
separators to the statewide industry in Illinois. The
estimates are based on the following:
Each wastewater separator is on the average 7,500
square feet based on interviews with petroleum re-
finers in Illinois.
All five refineries will implement the controls
to wastewater separators to comply with RACT.
Installed capital costs, including parts and labor,
were calculated based on $12.50 per square foot
times the area of the wastewater separator.
Annualized direct operating costs, expected to
be 3 percent of installed capital costs, include
costs for,labor, utilities, recordkeeping, and
training.
Annualized capital charges, estimated to be 25
percent of installed capital costs, include costs
for depreciation, interest, maintenance, taxes and
insurance.
Direct operating costs extrapolated from data in Control of Refinery
Vacuum Producing Systems, Wastewater Separators and Process Unit
Turnarounds, assuming maintenance is 4 percent of installed capital
cost.
12-15
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Exhibit 12-8
U.F. Environmental Protection Agency
STATEWIDE COSTS FOR VAPOR CONTROL
SYSTEMS FOR REFINERY WASTEWATEP SEPARATOR
Characteristics/Cost Item
Number of units
Total refinery capacity
(barrels per day)
Emission reduction
(tons/year)
Installed capital
($ millions, 1977}
Direct annual operating
cost ($ millions, 1977)
Annual capital ch?rg-='S
'? million;, 1977)
Data
5
557,700
7,203
0.473
0.014
0.138
Net annual cost
($millions, 1977)
Annual cost per ton of
emissions reduced
($ per ton)
0.132
18
a. These costs do not include any petroleum credit for controlled
emissions. If a product recovery system were installed, there
could be a potential petroleum credit of $655,000 annually.
However, additional cost is also likely to be required for the
product recovery systems.
Source; Booz, Allen & Hamilton Inc.
-------
No recovery system and associated product
savings are included for controlled VOCs.
Net annualized costs are the sum of the capital
charges and direct operating costs, less the-
petroleum credit.
Actual costs to refinery operators may vary, depending on the
type of manufacturer's equipment selected by each refinery
operator.
Based on the above assumptions, the total cost to the
industry for installing vapor recovery equipment on the
five remaining uncovered wastewater separators is estimated
to be $473,000. The annualized cost is estimated to be
$132,000. There is an estimated potential savings of more
than $650,000 annually for the recovery of gasoline vapors.
However, this savings is not included in the costs presented
as the cost of additional recovery equipment that may be required
is not included.
12-16
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12.5 DIRECT ECONOMIC IMPACTS
This section presents the direct economic impacts
of implenrienting RACT to refineries in Illinois. Impad =
include capital availability, technical feasibility and
value of shipments.
Since all refinery vacuum producing systems and
process unit turnarounds have already been controlled and
meet RACT requirements, remaining impacts result from
covering the five uncovered wastewater separators in Illinois.
Capital availability—It is expected that refine--
in Illinois will be "able to raise the estimated
$471,000 to cover five wastewater separators..
Technical feasibility—Wastewater separators have
been successfully covered at several refineries
in the United States. Therefore, it is expected
that Illinois refiners will be able to comply
technically with RACT.
Value of shipments—The net annualized cost for
implementing RACT is estimated to be an insignificent
percent of the value of refined products in Illinois.
Petroleum credit—An estimated $655,000 in petroleu-r
credits to refiners in Illinois could potentially be
achieved with the installation of additional vapor
recovery systems.
12-17
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12.6 SELECTED SECONDARY ECONOMIC IMPACTS
This section discusses the secondary impact of imple-
menting RACT on employment, market structure and productiv-
ity.
Employment—No change in employment is anticipated
from implementing RACT in Illinois.
Market structure—The market structure will remain
unchanged when RACT is implemented in Illinois.
Productivity—Worker productivity will probably be
unaffected by implementing RACT in Illinois.
Exhibit 12-9, on the following_page, summarizes the
findings of this chapter.
12-18
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Exhibit 12-9
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF IMPLEMENTIN<
RACT FOR REFINERY VACUUM PRODUCING SYSTEMS, WASTEWATE1
SEPARATORS AND PROCESS UNIT TURNAROUNDS
IN THE STATE OF ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative impor-
tance of industrial section to
state economy
Current industry technology
trends
1977 VOC actual emissions
Industry preferred method of
VOC control to meet RACT
guidelines
Assumed method of VOC control
to meet RACT guidelines
Discussion
12
1977 industry sales were $6.1 billion. The
estimated annual crude oil throughput was
434 million barrels
Most refineries comply with RACT with the
exception of 5 uncovered wastewater separate
7,583 tons per year
Vapor control of emissions by piping
emissions to refinery fuel gas system or
flare and covering wastewater separators
Vapor control of emissions from process
unit to refinery fuel gas system, cover
wastewater separators and piping emissions
from process units to flare.
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost ._n<-i
-------
BIBLIOGRAPHY
Control of Refinery Vacuum Producing Systems, Wastewater
Separators and Process Unit Turnarounds, EPA-450/2-77-025,
October 1977.
Revision of Evaporative Hydrocarbon Emission Factors, PB-267
659, Radian Corp., August 1976.
Control of Hydrocarbon Emissions from Petroleum Liquids,
PB-246 650, Radian Corp., September 1975.
Regulatory Guidance for Control of Volatile Organic Compound
Emissions from 15 Categories of Stationary Sources, EPA 905/
2-78-001, April 1978.
Systems and Costs to Control Hydrocarbon Emissions from
Stationary Sources, PB-236 921, Environmental Protection
Agency, September 1974.
Economic Impact of EPA's Regulations on the Petroleum Refining
Industry, PB-253 759, Sobotka and Co., Inc., April 1976.
Hydrocarbon Emissions from Refineries, American Petroleum
Institute, Publication No. 928, July 1973.
Technical Support Document, Petroleum Refinery Sources,
Illinois Environmental Protection Agency.
Petroleum Refining Engineering, W.L. Nelson, McGraw-Hill Book
Company, Inc. New York, 1958.
Petroleum Refinery Manual, Henry Martin Noel, Reinhold Publish-
ing Corporation, New York, 1959.
Oil and Gas Journal, April 23, 1973.
Petroleum Products Handbook, Virgil B. Guthrie, Editor, Mcgraw-
Hill Book Company, New York, 1960.
-------
Private conversations with the following:
Mr. Ed Sullivan, Amoco Oil Refinery, Wood River,
Illinois.
Mr. Oliver Goodlander, Texaco Refinery, Lockport,
Illinois.
Mr. Fritz, Exxon Research, New Jersey
Mr. Gordon Potter, Exxon Corporation, Houston,
Texas
Mr. Chuck Masser, U.S. EPA, Research Triangle
Park, North Carolina
Mr. Karlowitz, American Petroleum Institute,
Washington, D.C.
-------
-------
13.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
TANK TRUCK GASOLINE
LOADING TERMINALS IN
THE STATE OF ILLINOIS
-------
-------
13.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
TANK TRUCK GASOLINE
LOADING TERMINALS IN
THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT controls for tank truck gasoline loading
terminals in the State of Illinois. The chapter is divided
into six sections including:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic implications
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of tank
truck gasoline loading terminals, interviews and analysis.
13-1
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13.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for tank truck gasoline loading terminals in the State of
Illinois.
An overall assessment of the quality of the estimates
is detailed in the latter part of this section.
13.1.1 Industry Statistics
Industry statistics on tank truck gasoline loading
terminals were obtained from several sources. All data
were converted to a base year, 1977, based on the following
specific methodologies:
The number of establishments for 1977 was reported
by the Illinois Environmental Protection Agency.
The number of employees in 1977 was derived by
determining the number of employees per establish-
ment in 1972 from the 1972 Census of Wholesale
Trade, Petroleum Bulk Stations and Terminals and
multiplying this factor by the number of establish-
ments estimated for 1977.
The number of gallons of gasoline sold in 1977 in
the State of Illinois was estimated from 1972
sales (reported in the 1972 Census of Wholesale
Trade, Petroleum Bulk Stations and Terminals)
and factored to 1977 based on the net national
change in demand for gasoline from 1972 to 1977
(reported in the National Petroleum News Fact Book,
1978). ~ ~~~~
Sales, in dollars, of motor gasoline for 1977 were
estimated by multiplying the number of gallons of
gasoline sold in 1977 by the national dealer tank-
wagon price in 1977 (42.5£/gallon), which was also
reported in the National Petroleum News Fact Book,
1978. ~~~~~
13-2
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13.1.2 VOC Emissions
VOC emissions for tank truck gasoline loading terminals
in Illinois were provided by the Illinois Environmental Pro-
tection Agency from their emissions inventory. Illinois EPA
verified the data and calculated the emissions where data
were missing.
13.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for tank truck
gasoline loading terminals are described in Control of
Hydrocarbons from Tank Trucks Gasoline Loading Terminals,
EPA-450/2-77-026.These data provide the alternatives avail-
able for controlling VOC emissions from tank truck gasoline
loading terminals. Several studies of VOC emission control
were also analyzed in detail, and interviews with petroleum
trade associations, terminal operators and vapor control
equipment manufacturers were conducted to ascertain the most
likely types of control processes which would be used in
terminals in Illinois. The specific studies analyzed were:
Demonstration of Reduced Hydrocarbon Emissions from Gasoline
Loading Terminals, PB-243 363; Systems and Costs to ControT~
Hydrocarbon .Emissions from Stationary Sources, PB-236 921;
and The Economic Impact of Vapor Control in the Bulk Storage
Industry, draft report to U.S. EPA by Arthur D. Little.
The alternative types of vapor control equipment likely
to be applied to tank truck gasoline loading terminals were
analyzed. Model plants reflecting each control alternative
were defined and each type of control alternative used was
applied to the number of tank truck gasoline loading ter-
minals in the state. The methodology for the cost analysis
of VOC emissions control is described in the following para-
graphs.
13.1.4 Cost of Vapor Control Systems
The costs of vapor control systems were developed by:
Determining the alternative types of control
systems likely to be used
Estimating the probable use of each type of control
system
Defining systems components
13-3
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Developing installed capital costs for systems
components
Aggregating installed capital costs for each
alternative control system
Defining two model terminals based on throughput
levels
Developing costs of the alternative control systems
for the two model terminals including:
Installed capital cost
Direct operating costs
Annual capital charges
Gasoline credit
Net annual cost
Assigning model terminal costs to terminals in
Illinois
Aggregating costs to the total industry in Illinois
Costs were determined mainly from analyses of the RACT
guidelines and from interviews with petroleum marketers'
associations, terminal operators and vapor control equip-
ment manufacturers.
The assignment of the estimated cost of control to
Illinois required a profile of tank truck gasoline loading
terminals in the state by size of gasoline throughput. A
national profile is presented which was used to approximate
the terminals in Illinois since no data specific to Illinois
were available.
13.1.5 Economic Impact
The economic impacts were determined by analyzing the
lead time requirements needed to implement RACT; assessing
the feasibility of instituting RACT controls in terms of
capital availability and equipment availability; comparing
the direct costs of RACT control to various state economic
indicators; and assessing the secondary effects on market
structure, employment and productivity as a result of im-
plementing RACT controls in Illinois.
13-4
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13.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls on gasoline terminals in Illinois. A rating i
scheme is presented in this section to indicate the quality
of the data available for use in this study. A rating of
"A" indicates hard data (i.e., data that are published for
the base year); "B" indicates data that were extrapolated
from hard data; and "C" indicates data that were not avail-
able in secondary literature and were estimated based on
interviews, analyses of previous studies and best engineer-
ing judgment. Exhibit 13-1, on the following page, rates
each study output listed and the overall quality of the data.
13-5
-------
Exhibit 13-1
U.S. Environmental Protection Agency
DATA QUALITY
B C
A Extrapolated Estimated
Study Outputs Hard Data Data Data
Industry statistics
Emissions
Cost of emissions
control
Statewide costs of
emissions
Economic impact
Overall quality of
data
Source; Booz, Allen & Hamilton, Inc.
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13.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business trends
for tank truck gasoline loading terminals in Illinois are
presented in this section. The discussion includes a de-
scription of the number of facilities and their character-
istics, a comparison of the size of the gasoline terminal
industry to state economic indicators, a historical charac-
terization and description of the industry and an assessment
of future industry patterns. Data in this section form the
basis for assessing the impact on this industry of implemen-
ting RACT on tank truck gasoline loading terminals in Illinois
13.2.1 Size of the Industry
There were an estimated 34 tank truck gasoline loading
terminals, as of 1977, in Illinois. Industry sales were in
the range of $986 million, with an estimated yearly through-
put of 2.321 billion gallons of gasoline. The estimated
number of employees in 1977 was 853. These data and the
sources of information are summarized in Exhibit 13-2, on
the following page. Annual capital investments have not
been estimated. In general, tank truck gasoline loading
terminal investments are for plant and equipment to replace
worn-out facilities, modernize the establishments or improve
operating efficiencies.
13.2.2 Comparison of the Industry to the State Economy
A comparison of the tank truck gasoline loading terminal
industry to the economy of the State of Illinois is shown in
this section by comparing industry statistics to state
economic indicators. Employees in the tank truck gasoline
loading terminal industry represent 0.01 percent of the total
state civilian labor force of Illinois. The value of gasoline
sold from terminals represented less than 2 percent of the
total value of wholesale trade in Illinois in 1977.
13.2.3 Characterization of the Industry
Tank truck gasoline loading terminals are the primary
distribution point in the petroleum product marketing network
as shown in Exhibit 13-3, following Exhibit 13-2. Terminals
receive gasoline from refineries by pipeline, tanker or
barge.
13-6
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Exhibit 13-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR BULK TERMINALS
IN ILLINOIS
Number of Number of Sales Gasoline Sold
Establishments Employees ($ Billion, 1977) (Billions of Gallons)
343 85 3b 0.986C . 2.321*3
a. Illinois Environmental Protection Agency.
b. Booz, Allen & Hamilton Inc. estimate based on the ratio of the
number of employees to the number of establishments in 1972.
c. Number of gallons of motor gasoline sold in 1977 multiplied by
the national dealer tankwagon price in 1977 (42.51£/gallon)•
d. Booz, Allen & Hamilton Inc. estimate based on national change
in demand for gasoline from 1972 to 1977 (+10%). National
Petroleum Kews Fact Book, 1978.
-------
Exhibit 13-3
U.S. Environmental Protection Agency
GASOLINE DISTRIBUTION NETWORK
REFINERY
TERMINAL
V
V
BULK
PLANT
\/
LARGE VOLUME
ACCOUNTS
RETAIL
COMMERCIAL
AGRICULTURAL
•r-
V
^
"1
i
i
SMALL VOLUME
ACCOUNTS
AGRICULTURAL
COMMERCIAL
RETAIL
CUSTOMER
PICK-UP
o
O
Typical delivery route of truck-trailer
Typical delivery route of account truck
Typical transaction with consumer coming to supplier
Final Product Usage
Source; Economic Analysis of Vapor Recovery Systems on Small
Bulk Plants, EPA 240/1-77-013, September 1976, p. 3-2.
-------
Most gasoline terminals load all of the petroleum
product they receive into truck transports at the terminals'
loading racks. These truck transports usually have storage
capacities between 8,000 and 9,000 gallons and deliver gasoline
to service stations and bulk gasoline plants for further
distribution.
Over two-thirds of the gasoline terminals in the United
States are owned by major oil companies and refiner/marketers.
The remaining gasoline terminals are owned by independents.
The major oil companies and regional refiners own a propor-
tionately greater number of the large gasoline terminals and
proportionately fewer of the small gasoline terminals.
Approximately ten years ago, petroleum companies began
to consider gasoline terminals as separate profit centers.
Terminals are now expected to recover all operating expenses
as well as to provide an acceptable return on capital. Since
terminals are now treated as profit centers, petroleum mar-
keters have closed many uneconomic and marginal facilities
throughout the country. Some marketers have withdrawn
from selected regions of the country as part of their over-
all corporate strategy. Gasoline terminals in these markets
are being consolidated, sold or closed.
Gasoline terminals are generally located near refineries,
pipelines and large metropolitan areas. The daily through-
put ranges from 20,000 gallons per day to over 600,000 gallons
per day.
Exhibit 13-4, on the following page, shows an estimated
national distribution of gasoline terminals by throughput.
This distribution is assumed to be representative of terminals
in Illinois, for the purpose of this analysis since detailed
data of terminal throughput for Illinois were not. available.
13-7
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Exhibit 13-4
U.S. Environmental Protection Agency
DISTRIBUTION OF TANK TRUCK GASOLINE
LOADING TERMINALS BY AMOUNT OF THROUGHPUT
IN THE UNITED STATES
Gasoline
Throughput Percentage
(gallons per day) of Plants
Less than 200,000
200,000 to 399,000
400,000 to 599,000
Over 600,000
48
27
21
4
Total
100
Source: Bureau of Census, 1972 Census of Wholesale Trade.
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13.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents information on tank truck gasoline
loading terminal operations, estimated VOC emissions from
terminal operations in Illinois, the extent of current con-
trol in use, the requirements of vapor control required by
RACT and the likely RACT alternatives which may be used for
controlling VOC emissions from gasoline terminals in Illinois.
13.3.1 Tank Truck Gasoline Loading Terminal Operations
Tank truck gasoline loading terminals are the primary
distribution facilities which receive gasoline from pipelines,
tankers and barges; store it in above-ground storage tanks;
and subsequently dispense it via tank trucks to bulk gasoline
plants and service stations. Tank truck gasoline loading
terminals with an average daily gasoline throughput of 20,000
gallons per day or more (as defined by EPA) require vapor
control equipment to reduce VOC emissions from gasoline
terminal operations.
13.3.1.1 Facilities
Gasoline terminal facilities generally include tanks
for gasoline storage, loading racks and incoming and outgoing
tank trucks.
The most prevalent type of gasoline storage tank found
at gasoline terminals is the above-ground storage tank.
These tanks are usually cylindrical with domed ends (ver-
tical or horizontal). Typical storage capacities range from
500,000 to 5,000,000 gallons and each terminal averages
4.5 tanks.
A typical loading rack used for dispensing gasoline to
account trucks includes shut-off valves, meters, relief
valves, electrical grounding, lighting, by-pass plumbing and
loading arms. Loading may be by bottom fill, top splash or top
submerged fill. Bottom filling is used at 90 percent of
the terminals in Illinois. The remaining terminals employ
top submerged filling. A typical tank truck gasoline loading
terminal has one or two loading racks equipped with 4 to
20 loading arms, with an average gasoline pumping rate of
495 gallons per minute.
Trailer-transport trucks are used to supply bulk plants
and gasoline service stations with gasoline. Trailer-
transport trucks have four to six compartments and deliver
13-8
-------
approximately 8,000 to 9,000 gallons of gasoline to the bulk
plant or service station. Most commonly, trailer-transport
trucks are owned by oil companies or commercial carriers.
There are several trucks per facility. One terminal operator
who pumps 1.26 million gallons of gasoline per day reported
that he owns 30 trucks.
13.3.1.2 Operations
VOC emissions occur at various stages in tank truck
gasoline loading terminal operations. Gasoline is loaded
into trailer-transport trucks from gasoline storage tanks
via loading racks. The two methods of loading gasoline into
tank trucks are bottom filling and top submerged filling.
Emissions occur_from this operation through the displacement
of vapor laden air in the tank truck with gasoline, leakage in
seals and overfilling the truck. Vapor collection and proper
operation and maintenance are the recommended method for
controlling these emissions.
Another major source of emissions is from vaporization
of gasoline in the storage tank because of changes in pres-
sure in the tank caused by variation in temperature. These
emissions, referred to as breathing losses, are controlled
by adjusting the pressure relief valve on the storage tank
and equipping storage tanks of greater than 40,000 gallon
capacity with internal floating roofs.
Vapors collected during tank truck filling are condensed
or oxidized by vapor controlled equipment discussed in detail
in Section 13.3.4.
13.3.2 Emissions and Current Controls
This section presents the estimated VOC emissions from
tank truck gasoline loading terminals in Illinois in 1977
and the current level of emission control already implemented
in the state. Exhibit 13-5, on the following page, shows the
total estimated emissions in tons per year from gasoline ter-
minals in Illinois. Emissions were calculated by the Illinois
EPA. The estimated VOC emissions from the 34 tank truck
gasoline loading terminals are 22,629 tons per year.
Bottom filling is used at 90 percent of the gasoline
terminals in Illinois.
13-9
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Exhibit 13-5
U.S. Environmental Protection Agency
VOC EMISSIONS FROM TANK TRUCK GASOLINE
LOADING TERMINALS IN ILLINOIS
Number of Estimated
Facilities Number of Tanks Total Emissions
(tons/year)
34 1533 22,629b
a. Based on Illinois EPA survey indicating 4.5 tanks
per facility.
b. Illinois Environmental Protection Agency.
Source; Illinois Environmental Protection
Agency
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13.3.3 RACT Guidelines
The RACT guidelines for VOC emission control from tank
truck gasoline loading terminals require the following con-
trol systems:
Top submerged or bottom fill of gasoline storage
tanks and outgoing tank trucks
Vapor collection from trailer-transport truck
loading
Vapor recovery or thermal oxidation of collected
vapors
Proper operation and maintenance of equipment.
Exhibit 13-6, on the following page, summarizes the RACT
guidelines for VOC emissions control from .tank truck gasoline
loading terminals.
13.3.4 Selection of the Most Likely RACT Alternatives
Control of VOC emissions from tank truck gasoline
loading terminals is achieved using submerged or bottom
filling of storage tanks and of tank trucks and vapor control
of the loading of outgoing trailer-transport trucks:. There
are several alternative means of achieving vapor control at
tank truck gasoline loading terminals, based on the type of
vapor control equipment installed.
Four likely alternatives for vapor control are:
Adsorption/absorption
Compression refrigeration absorption
Refrigeration
Thermal oxidation.
Each type of vapor control system is briefly described below.
13.3.4.1 Adsorption/Absorption (AA)
Vapor control by adsorption/absorption is achieved by
the following method. Vapors from tank truck loading oper-
ations are collected and directed to one of two activated
carbon beds. Vapors are condensed into pores in the carbon.
13-10
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Exhibit 13-6
U.S. Environmental Protection Agency
VOC EMISSION CONTROL TECHNOLOGY FOR
TANK TRUCK GASOLINE LOADING TERMINALS
Facilities Affected Sources of Emissions RACT Control Guideline
Tank truck ter- Filling tank Top submerge or
minals with daily trucks and bottom fill tank
throughput of breathing and truck and one of
greater than 76,000 working losses the following vapor
liters (20,000 from storage control systems:
gallons) of gaso- tanks
line - Adsorption/
Absorption
Refrigeration
Compression
Refrigeration
Absorption
Thermal
Oxidation
Leakage Maintenance of
areas that may
leak
Source: U.S. Environmental Protection Agency
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These vapors are then regenerated by pulling a vacuum over
the bed. Cold gasoline is then circulated in a separator
and the hot vapors are absorbed into the cold gasoline.
This process has recently been marketed and is becoming
competitive with the refrigeration system described below.
It has been reported that less maintenance is required for
this type of vapor recovery system than for the other three
,. types.
13.3.4.2 Compression Refrigeration Absorption (CRA)
Vapor control by compression refrigeration absorption
is achieved by the following method. Vapors from tank truck
loading operations are collected in a vapor holder. The
pressure is increased in the holder, thus causing vapors to
condense. Further condensation is then achieved by mixing
chilled gasoline and vapors under pressure and the vapors
are absorbed into the gasoline. This system is becoming
less popular than the more recently developed refrigeration
system described below and it is not expected that this type
of system will be used in Illinois.
13.3.4.3 Refrigeration (RF)
Vapor recovery using refrigeration is based on the
condensation of gasoline vapors by refrigeration at atmos-
pheric pressure. Vapors displaced from tank truck loading
operations enter a horizontal fin-tube condenser where they
are cooled to a temperature of about -40°F and condensed.
Because vapors are treated as they are vented from tank
trucks, no vapor holder is required. Condensate is with-
drawn from the condenser and the remaining air containing
only a small amount of hydrocarbons is vented to the atmos-
phere. This system is priced competitively with AA systems
because of market pressure, although it is esimated to be
more costly to build.
13.3.4.4 Thermal Oxidation (OX)
Vapor control by thermal oxidation is achieved by
incineration devices. Gasoline vapors are displaced to a
vapor holder. When the vapor holder reaches its capacity,
vapors are released to the oxidizer, after mixing with a
properly metered air stream, and combusted. Later models of
this type of thermal oxidizer do not require vapor holders;
vapors from the tank trucks during loading operations are
13-11
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vented directly to the thermal oxidizer. It is not expected
that this type of vapor control system will be used in
Illinois since there are fire hazards with a flame and
terminal operators are also reportedly reluctant to burn
valuable hydrocarbons.
13.3.5 Leak Prevention from Tank Trucks
For vapor control systems to operate--optimally,
it is essential to maintain leakless tank trucks. This is
achieved by using proper operating procedures and periodic
maintenance of hatches, P-V valves and liquid and gaseous
connections.
13-12
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13.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATIONS FOR
THE MOST LIKELY RACT ALTERNATIVES
Costs for VOC emission control equipment are presented
in this section. The costs for the four types of vapor con-
trol systems described in Section 13.3 are presented for two
model tank truck gasoline loading terminals. The final sec-
tion presents an extrapolation of model terminal control
costs to the statewide industry.
13.4.1 Factory Costs for Four Types of Vapor Control Systems
The factory costs for the four types of vapor control
systems (summarized in Exhibit 13-7, on the following page)
were derived from analysis of the RACT guidelines; from
interviews with terminal operators, major oil companies and
equipment manufacturers; and from previous cost and economic
studies of tank truck gasoline loading terminals.
Adsorption/absorption and refrigeration systems are
expected to be the only two types of vapor control systems
used at tank truck gasoline loading terminals in Illinois.
It is estimated that 50 percent of the systems will be
adsorption/absorption and the other 50 percent will be
refrigeration systems. Factory costs for both systems are
assumed to be equal because of competitive pressures. Mainte-
nance costs for refrigeration systems are approximately 2
percent higher than those for adsorption/absorption systems.
13.4.2 Costs for Two Model Tank Truck Gasoline Loading
Terminals
Two model tank truck gasoline loading terminals and
their associated vapor control costs are characterized in
this section. The costs are based on the control estimates
for adsorption/absorption and refrigeration systems reported
by equipment manufacturers and through interviews.
Exhibit 13-8, following Exhibit 13-7, defines two model
tank truck gasoline loading terminals characteristics and
associated control costs. It is assumed that approximately
50 percent of the terminals in Illinois can be characterized
by Model Terminal A; the remaining 50 percent are assumed to
be characterized by Model Terminal B.
13-13
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Exhibit 13-7
U.S.'.Environmental Protection Agency
FACTORY COSTS OF ALTERNATIVE
VAPOR CONTROL SYSTEMS
Type of Control System
Factory Costc
for 250,000
gallon per
day system
($000, 1977)
Factory Cost
for 500,000
gallon per
day system
($000, 1977)
Adsorption/Absorption
Compression-Refrigera-
tion- Absorption
Refrigeration
Thermal Oxidation
120
128
120C
72
155
164
155
95
a. Costs are based on average of range of costs quoted by vendors
to the U.S. Environmental Protection Agency and reported in The
Economic Impact of Vapor Control on the Bulk Storage Industry, p. D.3,,
'draft report, July 1978. v ' '
b. Hydrotech Engineering reported a factory price of $92,000 for a
250,000 gallon per day unit.
c. Expect system priced competitively to adsorption/absorption system
due to market pressure.
Source: Hydrotech, U.S. Environmental Protection Agency, Exxon and
Booz, Allen & Hamilton Inc. estimates
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Tank Truck Gasoline Loading
Terminal Characteristics
Throughput
Loading racks
Storage tanks
Tank trucks
Compartments per account truck
Vapor control systems
Exhibit 13-8
U.S. Environmental Protection Agency
DESCRIPTION AND COST OF MODEL TANK
TRUCK GASOLINE LOADING TERMINALS
EQUIPPED WITH VAPOR CONTROL SYSTEMS
Model Terminal A
Model Terminal B
250,000 gallons/day ' 500,000 gallons/day
1 1
3 3
6 15
Adsorption/Absorption Adsorption/Absorption
Refrigeration Refrigeration
Tank Truck Gasoline Loading
Terminal Costs
AA
RF
AA
RF
Installed capital cost $258,000 $258,000 $355,000 $355,000
Annualized direct operating costs
. Electricity
Maintenance
Operating labor
Carbon replacement
Subtotal (direct operating costs)
Annualized capital charges
Net annualized cost (not in-
cluding gasoline credit)
3,900
10,800
1,500
2,400
18,600
54,180
72,780
9,900
13,200
1,500
_
24,600
54,180
78,780
7,800
13,950
1,500
4,700
27,950
74,440
102,500
19,800
17,050
1,500
—
38,350
74,550
112,900
SOURCE: Booz, Allen & Hamilton, Inc.
-------
.The costs for the model terminals are used in Section
13.4.3 to extrapolate costs of vapor control equipment to
the industry statewide. The costs for each model terminal
are:
Installed capital cost, which includes equipment
and modification costs, labor and costs to modify
trucks ($3,000 per truck)
Annualized direct operating costs which include elec-
tricity, maintenance, operating labor and carbon
replacement costs. Maintenance costs for the
adsorption/absorption system are slightly lower
than those for refrigeration
Annualized capital charges, which include costs for
depreciation, interest, taxes and insurance and
are estimated to be 21 percent of the installed
capital cost
Net annualized operating costs, which are the sum
of the capital charges and direct operating costs.
It should be noted that gasoline credit has not
yet been accounted for. Gasoline credit will be
taken into account when the costs are extrapolated
to the industry.
Another cost characterization that can be made is hydrocarbon
reduction versus cost. This finding will also be shown in
the statewide analysis.
13.4.3 Extrapolation to the Statewide Industry
Exhibit 13-9, on the following page, shows the extrap-
olation of vapor recovery costs to the statewide industry in
Illinois. The estimates are based on the following:
In Illinois, 50 percent of the tank truck gasoline
loading terminals can be characterized by Model
Terminal A and the remaining can be characterized
by Model Terminal B.
Fifty percent of the terminals will implement the
adsorption/absorption vapor control system to com-
ply with RACT and the other 50 percent will imple-
ment the refrigeration system to comply with RACT-.
13-14
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Exhibit 13-9
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
FOR TANK TRUCK GASOLINE LOADING TERMINALS
Characteristic/Cost Item
Number of terminals
Total annual throughput
(billions of gallons)
Uncontrolled emissions 22,629
(tons/year)
Emission reduction from 20,366
terminals (tons/year;
Installed capital cost 10.42
($ million, 1977)
Direct annual operating costs 0.930
{$ million, 1977)
Annual capital charges 2.188
($ millions, 1977)
Annual gasoline credit3 5.689
($ millions, 1977)
Net annualized cost (credit) (0.931)
($ millions, 1977)
Annual cost per ton of 25
emissions, terminal emissions
only ($ per ton)
Annual cost (credit) per ton (45)
of emissions reduced3
($ per ton)
Annual cost (credit) per ton 211
of emissions reduced from
gasoline marketing*3 ($ per ton)
a. Based on 44,492 tons of emissions recovered which includes 90 per-
cent of the 19,025 tons collected from gasoline service stations,
90 percent of the 7,782 tons collected from bulk plants and 20,366
tons collected at the terminal. Gasoline credit is calculated by
multiplying the number of tons of emissions collected by the esti-
mated number of gallons in a ton (294 gallons) by a price of $.39
per gallon
b. Annual cost of emissions reduced from gasoline marketing based on
sum of net annualized costs from terminals, bulk plants, gasoline
dispensing facilities and fixed-roof tanks divided by'the sum of
emissions reductions from these same categories.
Source: Booz, Allen & Hamilton Inc.
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RACT is implemented at bulk gasoline plants and
gasoline service stations in the state. Ninety
percent of the gasoline vapors collected from bulk
gasoline plants and gasoline service stations are
recovered and credited to the tank truck gasoline
loading terminal.
Based on the above, the total cost to the industry
for installing vapor recovery equipment is estimated
to exceed $10 million. The amount of gasoline recovered
from terminals, bulk gasoline plants and gasoline ser- i
vice stations is valued at $5.689 million. The annual
cost per ton of emissions controlled from terminals is
estimated to be $25 per ton. The overall cost per ton of
emissions controlled from bulk terminals including the
gasoline recovery from bulk plants and service stations
represents an estimated savings of $45 per ton.
13-15
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13.5 DIRECT ECONOMIC IMPLICATIONS
This section presents the direct economic implications
of implementing RACT controls to the statewide industry,
including availability of equipment and capital; feasibility
of the control technology; and impact on state economic in-
dicators .
13.5.1 RACT Timing
RACT is assumed to be implemented by January 1, 1982.
This implies that tank truck gasoline loading terminal oper-
ators must have vapor control equipment installed and oper-
ating within the next three _years. The timing requirements
of RACT impose several requirements on terminal operators
including:
Determining appropriate vapor control system
Raising capital to purchase equipment
Acquiring the necessary vapor control equipment
Installing and testing vapor control equipment to
insure that the system complies with RACT.
The sections which follow discuss the feasibility and the
economic implications of implementing RACT within the re-
quired timeframe.
13.5.2 Feasibility Issues
Technical and economic feasibility issues of implementing
RACT controls are discussed in this section.
Several tank truck gasoline loading terminal operators
in the United States have successfully implemented vapor
control systems. State adoption of RACT regulations will
generate a new demand for vapor control systems. It is
expected that sufficient leadtime is available to meet the
increased demand, for equipment.
13-16
-------
In the area of economic feasibility it has been
reported from interviews that terminal operators should
have access to capital to purchase vapor control equipment,
and it is expected from information through interviews that
terminals will not cease operations because of the cost of
implementing RACT. If RACT is implemented statewide at tank
truck gasoline loading terminals, bulk gasoline plants and
gasoline service stations, there should be a potential savings
for terminals if the total system operates at maximum
efficiency.
13.5.3 Comparison of Direct Cost with Selected Direct
Economic Indicators
This section presents a comparison of the net annualized
credit of implementing RACT with the total value of gasoline
sold in the state and the value of wholesale trade in the
state.
The net annualized credit to the tank truck gasoline
loading terminals resulting from RACT represents .09 percent
of the total gasoline sold in the state. When compared to
the statewide value of wholesale trade, the annualized
credit is small.
13-17
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13.6 SELECTED SECONDARY ECONOMIC IMPACTS
This section discusses the secondary economic impact
of implementing RACT on employment, market structure and
productivity.
Employment—No decline in employment is predicted
since terminals should not close solely because
of RACT requirements. A slight increase in operating
and maintenance labor will be required through imple-
mentation of RACT but this is predicted to have
minimal impact on any employment increase.
Market structure—No change in market structure
is expected from implementation of RACT.
Productivity—No change in worker productivity is
expected to result from implementation of RACT.
Exhibit 13-10, on the following page, presents a summary
qf the findings of this report.
13-18
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Exhibit 13-10
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR TANK TRUCK GASOLINE
LOADING TERMINALS IN ILLINOIS
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT ouidelines
Discussion
34
1977 industry sales were $986 million. The
estimated annual throughput was 2.321 billion
New terminals will be designed with vapor
recovery equipment
22,630 tons per year
Submerge or bottom fill and vapor recovery
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized credit (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after control
Cost effectiveness of control
Discussion
$10.42 million
$0.930 million (approximately .09 percent of
value of shipment
No change in price
Assuming full recovery of gasoline—net saving;
of 139,000 barrels annually from terminal
emissions
No major impact
No direct impact
No direct impact
Gasoline credit from vapors from bulk gasoline
plants and gasoline service stations require
uniform RACT requirements throughout the
state
2,300 tons per year
$45 annualized credit/annual ton of VOC
reduction from terminals assuming gasoline
credit from vapors returned from bulk gasoline
plants and gasoline service stations
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
National Petroleum News Fact Book, 1976, McGraw Hill, Mid-
May 1976.
National Petroleum News Fact Book, 1977, McGraw Hill, Mid-
May 1977.
•National Petroleum News Fact Book, 1978, McGraw Hill, Mid-
June 1978.
Control of Hydrocarbons from Tank Truck Gasoline Loading
Terminals/ EPA-450/2-77-026, U.S. environmental
Protection Agency, October 1977.
The Economic Impact of Vapor Control on the Bulk Storage
Industry, prepared for U.S. Environmental Protection
Agency by Arthur D. Little, draft report, July 1978.
Regulatory Guidance for Control of Volatile Organic Compound
Emissions from 15 Categories of Stationary Sources,
EPA-905/2-78-001, April 1978.
Systems and Costs to Control Hydrocarbon Emissions from
Stationary Sources, PB-236 921, Environmental Protection
Agency, September 1974.
1972 Census of Wholesale Trade, Petroleum Bulk Stations and
Terminals, U.S. Bureau of Census.
Demonstration of Reduced Hydrocarbon Emissions from Gasoline
Loading Terminals, PB-234 363.
Private conversation with Mr. Clark Houghton, Mid-Missouri
Oil Company.
Private conversation with Mr. Gordon Potter, Exxon, Houston,
Texas.
Private conversation with Mr. James McGill, Hydrotech,
Tulsa, Oklahoma.
Private conversation with Mr. Frederick Rainey, Shell Oil
Company, Houston, Texas.
-------
Private conversation with Mr. William Deutsch, Illinois
Petroleum Marketers Association, Springfield, Illinois
Private conversation with Mr. Richard Pressler, Illinois
Environmental Protection Agency, Springfield, Illinois
-------
14.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
BULK GASOLINE PLANTS IN
THE STATE OF ILLINOIS
-------
-------
14.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
BULK GASOLINE PLANTS IN
THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT controls for bulk gasoline plants in
the State of Illinois. The chapter is divided into six
sections including:
Specific methodology and quality of estimates
Industry statistics
The technical situation of the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic implications
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of bulk
gasoline plants, interviews, and analysis.
14-1
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14.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for bulk gasoline plants in the State of Illinois.
An overall assessment of the quality of the estimates
is detailed in the latter part of this section.
14.1.1 Industry Statistics
Industry statistics on bulk gasoline plants were
obtained from several sources. All data were converted to
a base year, 1977, based on the following methodologies:
The number of establishments for 1977 was provided
by the Illinois Environmental Protection Agency
(EPA).
The number of employees in 1977 was derived from
the 1972 Census of Wholesale Trade, Petroleum Bulk
Stations and Terminals, by determining the number
of employees per establishment in 1972 and mul-
tiplying this factor by the number of establish-
ments reported for 1977.
The number of gallons of gasoline sold in 1977 in
the State of Illinois was estimated based on 1972
data (reported in 1972 Census of Wholesale Trade,
Petroleum Bulk Stations and Terminals) and factored
to 1977 based on the net national change in demand
for gasoline (reported in the National Petroleum
News Fact Book, 1978).
Sales, in dollars, of motor gasoline for 1977 were
estimated by multiplying the number of gallons of
gasoline sold in 1977 by the national dealer tank-
wagon price in 1977 (42.51C/gallon—reported in
the National Petroleum News Fact Book, 1978) .
14-2
-------
14.1.2 VOC Emissions
The Illinois EPA conducted a survey to determine the
VOC emissions for bulk gasoline plants since no data were
available in the state emissions inventory. Emissions were
determined for a sample of 70 bulk gasoline plants selected
at random from the listing of bulk gasoline plants in the
Illinois EPA emissions inventory data base. From these
sample emissions data, the Illinois EPA calculated average
gasoline throughput and emissions to arrive at figures for
a "typical" gasoline bulk plant. The figures for the
"typical" plant were then multiplied by the number of plants
in Illinois to estimate overall emissions. The emissions
data provided by the Illinois EPA survey are used in this
report.
14.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for bulk
gasoline plants are described in Control of Volatile
Organic Emissions from Bulk Gasoline Plants, EPA-450/2-77-
035. These data provide the alternatives available for con-
trolling VOC emissions from bulk gasoline plants. Several
studies of VOC emission control were also analyzed in detail,*
and interviews with petroleum trade associations, bulk plant
operators, and vapor control equipment manufacturers were
conducted to ascertain the most likely types of control
processes which would be used in bulk gasoline plants in
Illinois. The specific studies analyzed were: Evaluation
of Top Loading Vapor Balance Systems for Small Bulk Plants,
EPA340/1-77-014; Economic Analysis of Vapor Recovery
Systems on Small Bulk Plants, EPA 340/1-77-013; Systems
and Costs to Control Hydrocarbon Emissions from Stationary
Sources, EPA PB-236 921; and Study of Gasoline Vapor
Emission Controls at Small Bulk Plants, EPA PB-267-096.
The alternative types of vapor control equipment likely
to be applied to bulk gasoline plants were arrayed, and
percentage reductions from using each type of control were
determined. The methodology for the cost analysis based on
this scheme is described in the following paragraphs.
14.1.4 Cost of Vapor Control Systems
The costs of vapor control systems were developed by:
Determining the alternative types of control
systems likely to be used
14-3
-------
Estimating the probable use of each type of control
system
Defining systems components
Developing installed capital costs for systems
components
Aggregating installed capital costs for each
alternative control system
Defining two model plants
Developing costs of control systems for model
plants including
Installed capital cost
Direct operating costs
Annual capital charges
Gasoline credit
Net annualized cost
Assigning model plant costs to plants in Illinois
Aggregating costs to the total industry in
Illinois.
Costs were determined from analyses of the following
previous studies:
Control of Volatile Organic Emissions from Bulk
Gasoline Plants. EPA 450/2-77-035
Study of Gasoline Vapor Emission Controls at
Small Bulk Plants, EPA PB-267 096
Economic Analysis of Vapor Recovery Systems on
Small Bulk Plants, EPA, 340/1-77-013
Evaluation of Top Loading Vapor Balance Systems
for Small Bulk Plants, EPA 340/1-77-014
and from interviews with petroleum marketers' associations,
bulk plant operators, and vapor control equipment manufac-
turers.
14-4
-------
The assignment of the estimated cost of control to
Illinois required a profile of bulk plants for the state,
showing the percentage of plants for:
Various ranges of throughput
Using top loading for account trucks
Using bottom loading
Plants with vapor control equipment already installed.
Since detailed data on bulk gasoline plant characteristics
were not available for Illinois, it was assumed that data
developed in a previous study of small bulk plants in
Colorado and California could be used to characterize
bulk plant throughput in Illinois" ty throughput ranges.
14.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements needed to implement RACT; assessing
the feasibility of instituting RACT controls in terms of
capital availability and equipment availability; comparing
the direct costs of RACT control to various state economic
indicators; and assessing the secondary effects on market
structure, employment, and productivity as a result of im-
plementing RACT controls in Illinois.
14.1.6 Quality of Estimates
Several sources of information were utilized in
assessing the emissions, cost, and economic impact of
implementing RACT controls on bulk gasoline plants in
Illinois. A rating scheme is presented in this section to
indicate the quality of the data available for use in this
study. A rating of "A" indicates hard data (i.e., data that
are published for the base year); "B" indicates data that were
extrapolated from hard data,- and "C" indicates data that were
not available in secondary literature and were estimated
based on interviews, analyses of previous studies, and best
engineering judgment. Exhibit 14-1, on the following page,
rates each study output listed and the overall quality of
the data.
14-5
-------
bxnibit 14-1
U.S. Environmental Protection Agency
DATA QUALITY
B C
A Extrapolated Estimated
Study Outputs Hard Data Data Data
Industry statistics
Emissions
Cost of emissions
control
Statewide costs of
emissions
Economic impact
Overall quality of
data
Source: Booz, Allen & Hamilton, Inc.
-------
14.2 INDUSTRY STATISTICS
Industry characteristics, statistics, and business
trends for bulk gasoline plants in Illinois are presented
in this section. The discussion includes a description of
the number of facilities and their characteristics, a com-
parison of the size of the bulk gasoline plant industry to
•state economic indicators, a historical characterization and
description of the industry, and an assessment of future
industry patterns. Data in this section form the basis for
assessing the impact on this industry of implementing RACT
to VOC emissions from bulk gasoline plants in Illinois.
14.2.1 Size of the Industry
There were an estimated 1,126 bulk gasoline plants, as
of 1977, in Illinois. Industry sales were in the range of
$527 million, with an estimated yearly throughput of 1.241
billion gallons of gasoline. The estimated number of em-
ployees in 1977 was 5,187. These data and the sources of
information are summarized in Exhibit 14-2, on the following
page. Annual capital investments have not been estimated.
In general, bulk plant capital investments are for plant
and equipment to replace worn-out facilities, modernize the
establishments, or improve operating efficiencies.
14.2.2 Comparison of the Industry to the State Economy
A comparison of the bulk gasoline plant industry to
the economy of the State of Illinois is shown in this
section by comparing industry statistics to state
economic indicators. Employees in the bulk gasoline
plant industry represent 0.1 percent of the total state
civilian labor force of Illinois. The value of
gasoline sold from bulk plants represents 0.7 percent
of the total value of wholesale trade in Illinois in
1972. Data were not available for comparison in 1977.
14.2.3 Characterization of the Industry
Bulk plants are an intermediate distribution point
in the petroleum product marketing network as shown in
Exhibit 14-3, following Exhibit 14-2. Bulk gasoline plants
compete with bulk gasoline tank terminals and large retail
gasoline outlets. Ownership and operation of bulk plants
are predominantly by independent jobbers and commissioned
14-6
-------
Exhibit 14-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR BULK GASOLINE
PLANTS IN ILLINOIS
Number of Number of
Establishments Employees Sales Gasoline Sold
($ billion, 1977) (billions of gallons)
l,126a 5,187b 0.527° 1.241d
Sources:
a. State of Illinois
b. Booz, Allen & Hamilton estimate based on the ratio of the
number of employees to the number of establishments in 1972
c. Number of gallons of motor gasoline sold in 1977, mulitiplied
by the national dealer tankwagon price in 1977 (42.51£/gallon)
National Petroleum News Fact Book, 1978
d. Booz, Allen & Hamilton Inc. estimate based on national change
in demand for gasoline from 1972 to 1977 (+10%). National
Petroleum News Fact Book, 1978.
-------
Exhibit 14-3
U.S. Environmental Protection Agency
GASOLINE DISTRIBUTION NETWORK
REFINERY
V
v
V..
BULK
PLANT
A
SMALL VOLUME
ACCOUNTS
AGRICULTURAL
COMMERCIAL
RETAIL
O
I
i
i
•h-
TERMINAL
V
LARGE VOLUME
ACCOUNTS
RETAIL
COMMERCIAL
AGRICULTURAL
CUSTOMER
PICK-UP
-*- Typical delivery route of truck-trailer
— *- Typical delivery route of account truck
- Typical transaction with consumer coming to supplier
Final Product Usage
O
Source: Economic Analysis of Vapor Recovery Systems on Small
Bulk Plants, EPA 340/1-77-013, September 1976, p. 3-2.
-------
agents but also includes cooperatives and salaried employees.
The independent jobber owns the equipment and structures
at his bulk plant, the inventory, and rolling stock, and
he contracts directly with the oil company for gasoline. A
commissioned agent usually does not own the equipment and
facilities but operates the bulk plant for a major integrated
oil company.
Bulk gasoline plants are typically located near towns
and small cities, since their predominant market is agri-
cultural and small retail accounts. The maximum daily
throughput of a bulk gasoline plant ranges from less than
2,000 gallons per day up to 20,000 gallons per day.
Exhibit 14-4, on the following page, shows a typical distri-
bution of bulk gasoline plants by plant throughput in Illinois
based on national data.
It is estimated that the majority of the bulk gasoline
plants are up to 25 years old, with a few new modernized,
higher volume plants. Forty years ago, bulk gasoline plants
were a major link in the gasoline distribution network.
From that time, their importance has been declining in the
marketing sector of the petroleum industry, basically for
economic reasons. There is evidence that profitability in
bulk gasoline plants has been decreasing. The number of
bulk gasoline plants decreased by 11 percent nationally
from 1967 to 1972 and is predicted to continue declining
in the near term.--- This decline is largely attributable to
major oil companies disposing of commission-agent-operated
bulk plants.
National Petroleum News Pact Book, 1976.
14-7
-------
Gasoline
Throughput
(gallons per day)
Exhibit 14-4
U.S. Environmental Protection Agency
DISTRIBUTION OF BULK GASOLINE PLANTS
BY AMOUNT OF THROUGHPUT
Percentage
of Plants
Less than 2,000
2,000 to 3,999
4,000 to 5,999
6,000 to 7,999
8,000 to 9,999
10,000 to 11,999
12,000 to 13,999
14,000 to 15,999
16,000 to 17,999
18,000 to 20,000
24
27
16
8
12
4
1
2
1
5
Source; Economic Analysis of Vapor Recovery Sys-
tems on Small Bulk Plants, EPA, Septem-
ber 1976.
-------
14.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents information on bulk gasoline
plant operation, estimated VOC emissions from bulk gasoline
plant operations in Illinois, the extent of current control
in use, the requirements of vapor control required by RACT
and the likely RACT alternatives which may be used for con-
trolling VOC emissions from bulk gasoline plants in Illinois.
14.3.1 Bulk Gasoline Plant Operations
Bulk gasoline plants are typically secondary distribu-
tion facilities which receive gasoline from bulk gasoline
tank terminals by trailer-transport trucks; store it in
above-ground storage tanks; and subsequently dispense it
via account trucks to local farms, businesses and service
stations. Bulk gasoline plants with an average daily
gasoline throughput of 20,000 gallons per day or less have
been defined by EPA as requiring vapor control equipment
to reduce VOC emissions from bulk gasoline plant operations.
14.3.1.1 Facilities
Bulk plant facilities generally include tanks for
gasoline storage, loading racks and incoming and outgoing
tank trucks.
The most prevalent type of gasoline storage tank found
at bulk gasoline plants is the above-ground storage tank.
These tanks are usually cylindrical with domed ends (vertical
or horizontal). Typical storage capacities range from
13,000 to 20,000 gallons and the number of tanks
at each plant ranges from one to eight, with an average of
three tanks per plant.
A typical loading rack used for dispensing gasoline to
account trucks includes shut-off valves, meters, relief
valves/ electrical grounding, lighting, by-pass plumbing
and loading arms. Loading may be by bottom fill, top
splash, submerge fill pipe through hatches, or dry connections
on the tops of trucks. Top filling is used in about 95
percent of bulk plants and bottom filling in the remaining
,5 percent, although the industry trend is toward bottom
filling. A typical bulk gasoline plant has one loading
rack with an average gasoline pumping rate of 125 gallons
per minute.
14-8
-------
Trailer-transport trucks supply bulk plants with gasoline,
while account trucks deliver gasoline to bulk plant customers.
Trailer-transport trucks have four to six compartments and
deliver approximately 8,000 gallons of gasoline to the bulk
plant. Most commonly, trailer-transport trucks are owned by
oil companies or commercial carriers. Account trucks
.usually have four compartments with a total capacity of
2,000 gallons. Bulk plants have an average of two account
trucks, and these trucks are most commonly owned by the
bulk plant operator.
14.3.1.2 Operations
VOC emissions occur at various stages in bulk plant
operations. Gasoline is unloaded from trailer-transport
trucks into gasoline storage tanks. The two methods of
unloading gasoline into storage tanks are bottom filling
and top submerged filling. Emissions occur from this
operation through the displacement of vapor laden air in
the storage tank with gasoline. Vapor balancing between
the tank truck and the storage tank is the recommended
method for controlling these emissions.
Another major source of emissions is from vaporization
of gasoline in the storage tank because of changes in
pressure in the tank caused by variation in temperature.
These emissions, referred to as breathing losses, are controlled
by adjusting the pressure relief valve on the storage tank.
The final major occurrenceof emissions is during loading
of account trucks which dispense gasoline to bulk plant
customers. The cause of emissions during account truck
filling is from turbulence of the liquids being loaded and
the resulting vaporization. The vapor laden air in the
account truck is displaced to the atmosphere during filling.
Top loading account trucks cause greater emissions than
trucks loading from the bottom since greater liquid
turbulence occurs. Vapor balancing the account truck and
the storage tank is the primary method for controlling
emissions.
14.3.2 Emissions and Current Controls
This section presents the estimated VOC emissions from
bulk gasoline plants in Illinois in 1977 and the current
level of emission control already implemented in the state.
Exhibit 14-5, on the following page, shows the total estimated
14-9
-------
Exhibit 14-5
U.S. Environmental Protection Agency
VOC EMISSIONS FROM BULK GASOLINE
PLANTS IN ILLINOIS
Number of Estimated Average Daily
Facilities Number of Tanks Throughput Total Emissions
(gallons) (tons/year)
.1,126 3,378 3,400,000 11,500
Source: Illinois Environmental Protection Agency
-------
emissions in tons per year from bulk plants in Illinois.
Emissions were calculated by the Illinois EPA based on a
detailed survey of bulk gasoline plants in Illinois. The
estimated VOC emissions from the 1,126 bulk plants are
11,500 tons per year.
Illinois EPA assumed that 95 percent of the loading facil-
ities are currently equipped with submerged loading equipment,
although actual data in the Illinois permit files do not
verify this. However, Illinois EPA verified this assumption
with their permit and field operations personnel. Approxi-
mately 5 percent of bulk gasoline plants in Illinois report-
edly use bottom filling.
14.3.3 RACT Guidelines
The RACT guidelines for VOC emission control from
bulk gasoline plants require the following control systems:
Top submerged or bottom fill of gasoline storage
tanks and outgoing account trucks
Vapor balancing between the incoming trailer-
transport truck and the gasoline storage tank
Vapor balancing between the gasoline storage
tank and the outgoing account truck
Proper operation and maintenance of equipment.
Exhibit 14-6, on the following page, summarizes the RACT
guidelines for VOC emissions control from bulk gasoline
plants.
14.3.4 Selection of the Most Likely RACT Alternatives
Control of VOC emission from bulk gasoline plants is
achieved using submerged or bottom filling of storage tanks
and account trucks and vapor balancing between the loading
and unloading of incoming and outgoing trailer-transport
trucks and the gasoline storage tanks. There are several
alternative means of achieving vapor control at bulk gasoline
plants, based on the manner in which the bulk plant is
operated.
14-10
-------
EXHIBIT 14-6
U.S. Environmental Protection Age
VOC EMISSION CONTROL TECHK' .L'">. /; :
BULK GASOLINE PLANTS
Facilities
Affected
Bulk plants with
daily throughputs
of 76,000 liters
(20,000 gallons)
of gasoline or less
Sources of
Emissions
RACT Control
Guideline
Vapor displacement
from filling ac-
count trucks, and
breathing losses
and working losses
from storage tanks
Submerge filling and
vapor balancing:
. Vapor balancing of
transport truck and
storage tank
. Vapor balancing of
storage and
account truck
Cracks in seals
and connections
Proper operation
maintenance
Improper hook up
of liquid lines
and top loading
nozzles
Proper operation
maintenance
Truck cleaning
Proper operation
maintenance
Pressure vacuum
relief valves
Proper operation
maintenance
Source: Control of Volatile Organic Emissions from Bulk Gasoline
Plants. EPA-450/2-77-035.
-------
Three likely control alternatives, summarized in
Exhibit 14-7, on the following page, are discussed separately
in the paragraphs which follow.
14.3.4.1 Alternative I
Control Alternative I involves equipping existing top
submerged fill bulk plants with a vapor balancing system.
In detail, this control alternative implies:
Submerged filling of gasoline storage tanks
Vapor balancing between the incoming trailer-
transport truck and the gasoline storage tank
Submerged top loading of outgoing account trucks
Vapor balancing of gasoline storage tank and
outgoing account truck
Equipping account trucks with vapor balancing
connections.
The Illinois Petroleum Marketers Association reported
that 95 percent of the bulk gasoline plants in Illinois
use top submerged loading systems for filling account trucks.
It is estimated that 95 percent of the bulk plants in Illinois
would select Control Alternative I to achieve vapor recovery
to meet the state RACT requirements. During interviews,
the industry has questioned whether vapor recovery by this
control method will achieve 90 percent emissions recovery
as stated in the RACT guidelines.
14.3.4.2 Alternative II
Control Alternative II involves implementing a complete
vapor balancing system on bulk plants which currently operate
with bottom filling. In detail this control alternative
encompasses:
Vapor balancing between the incoming trailer-
transport truck and the gasoline storage tank
Vapor balancing between the gasoline storage tank
and the outgoing account truck
Modification of account trucks to accommodate a
vapor recovery connection.
14-11
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Exhibit 14-7
U.S. Environmental Protection Agency
ALTERNATIVE CONTROL METHODS
FOR VAPOR CONTROL AT BULK GASOLINE PLAI
Description of
Alternative Number Control Method
Vapor balance entire system
II Vapor balance existing
bottom filled bulk
plant
III Convert top filled bulk
plant to bottom filled,
and vapor balance total
system
Source: BOOZ, Allen and Hamilton analysis of Control of Volatile
Organic Emissions from Bulk Gasoline Plants,
EPA-450/2-77-035.
-------
The Illinois Petroleum Marketers Association reports that
approximately 5 percent of the bulk gasoline plants in
Illinois use bottom filling. These plants would be the more
modern bulk plants. In some cases, it is estimated that bulk
gasoline plants which bottom fill are already equipped with
vapor balancing systems.
14.3.4.3 Alternative III
Control Alternative III involves converting top loading
bulk gasoline plants to bottom filling and implementing a
complete vapor balancing system. In detail, this control
alternative entails:
Converting the loading rack to bottom filling
Converting storage tank loading to bottom filling
Vapor balancing the incoming trailer-transport
truck and the gasoline storage tank
Converting the account truck to bottom loading and
installing vapor balancing connections on the
account truck.
The additional cost of converting a bulk plant from
top filling to bottom filling makes Control Alternative III
more costly than Control Alternative I. This additional
cost may be attributable to improved bulk plant operations,
rather than compliance with the proposed limitations.
14-12
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14.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATIONS
FOR THE MOST LIKELY RACT ALTERNATIVES
Costs for VOC emission control equipment are presented
in this section. The costs for the three alternative
control systems described in Section 14.3 are described
individually, followed by costs for typical bulk plants.
The final section then presents an extrapolation of
typical bulk gasoline plant control costs to the statewide
industry.
14.4.1 Costs for Alternative Control Systems
The costs for the three alternative control systems
(summarized in Exhibit 14-8, on the following page) were
derived from analysis of the RACT guidelines, from
interviews with bulk plant operators and petroleum marketing
trade associations and from previous cost and economic
studies of small bulk plants.
Control Alternative I is expected to be the most widely
applied system primarily because of the cost. The Illinois
Petroleum Marketers Association reports that 95 percent of
the bulk gasoline plants in Illinois employ top submerged
filling. The U.S. EPA currently endorses the cost estimates
developed by Pacific Environmental Services, Inc. for the
Houston/Galveston area bulk plants. However, several large
volume bulk plant operators who were interviewed have
reported vapor control costs in excess of $50,000 which
included conversion of the loading rack to bottom filling.
Control Alternative II is similar in cost to Control
.Alternative I based on interviews with equipment manufacturers
regarding costs for vapor balancing existing top submerged and
bottom filled bulk gasoline plants. Since no data are avail-
able it is assumed that the 5 percent of bulk plants which cur-
rently bottom fill must equip their plants with vapor balancing
to comply with RACT.
Control Alternative III is the most costly control
system. Several bulk gasoline plant operators interviewed
in California and Maryland have adopted this system, although
it cannot be shown from the data in Illinois that any bulk
gasoline plant in Illinois would be willing to implement
a system this costly. This alternative, therefore, is not
included in the extrapolation of vapor control costs to the
statewide industry in the next section.
14-13
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Exhibit 14-8
U.S. Environmental Protection Agency
COSTS OF ALTERNATIVE VAPOR CONTROL SYSTEMS
Cost Estimate
National Oil
Jobbers Council
estimate
Alternative
I
1 truck (4-com-
partments)
1 loading rack
(3 arms)
3-inch system
Pre-set meters
Direct Cost
(no labor)
$20,524 (with-
out air)
$22,754 (with
air)
Alternative Alternative
II III
(Includes conversion
to botton filling)
Similar to costs 1 truck (4-com-
for alternative partments)
I
1 loading rack
(3 arms)
3-inch system
Pre-set meters
Direct cost
(No labor)
$27,729
Pacific Environ-
mental Services
estimate of
Houston/Galveston
area system
1 loading rack
Meters
Average instal-
led cost
$3,200 (without
metering)
$7,700 (with
metering)
Wiggins sysfem
Source:
National Oil Jobbers Council, Pacific
Environmental Services Inc., Wiggins
Division, Delaware Turbines, Inc.
1 truck 4-com-
partments )
1 loading rack
(4 arms)
Pre-set meters
Installed cost
$17,352-
$18,416
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14.4.2 Costs for Two Model Bulk Plants
Two model bulk plants and their associated vapor control
costs are characterized in this section. The costs are
based on the control estimates for Control Alternative I,
reported by Pacific Environmental Services, Inc. for bulk
plants in the Houston/Galveston area. Several other bulk
.plant operators have reported costs in excess of $50,000
for vapor control systems although U.S. EPA estimates that
these systems exceed the level of adequacy required to meet
RACT.
Exhibit 14-9, on the following page, defines two model
bulk plant characteristics and associated control costs.
It is assumed that approximately 75 percent of the bulk plants
in Illinois can be characterized by Model Plant A; the
remaining 25 percent are assumed to be characterized by Model
Plant B. Since bulk plants only have one loading rack the only
difference between Model Plant A and Model Plant B is in the
number of trucks.
The costs for the model plants are used in Section 14.4.3
to extrapolate costs of vapor control equipment to the
industry statewide. The costs for each model plant are:
Installed capital cost, which includes parts
and labor
Annualized direct operating costs, expected to be
3 percent of installed capital costs, including
costs for labor, utilities, recordkeeping and
training costs
Annualized capital charges, estimated to be 25 per-
cent of installed capital costs, including costs
for depreciation, interest, maintenance, taxes and
insurance
Net annualized costs, which are the sum
of the capital charges and direct operating costs.
No gasoline credit is expected for bulk plants in
Illinois.
Another cost characterization that can be made is hydro-
carbon reduction versus cost. This finding will be
shown in the statewide analysis.
14-14
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Exhibit 14-9
U.S. Environmental Protection Agency
DESCRIPTION AND COST OF MODEL BULK PLANTS
EQUIPPED WITH VAPOR CONTROL SYSTEMS
Bulk Plant
Characteristics
Throughput
Loading racks
Storage tanks
Account trucks
Compartment per account
truck
Vapor control system
Model Bulk
Plant A
Model Bulk
Plant B
2,500 gallons/day
1
3
2
13,000 gallons/day
1
3
4
4 4
Alternative I or II Alternative I or II
Bulk Plant
Costs
Installed capital cost3
Annualized direct operating
costs @ 3 percent of
installed cost
Annualized capital
charges @ 25 percent
of installed capital
cost
Net annualized cost
(not including gasoline
credit)
$13,700
411
3,425
3,836
$19,700
591
4,925
5,516
a. Cost to modify one 4-compartment account truck estimated
to be $3,000.
Source: Booz, Allen & Hamilton, Inc.
-------
14.4.3 Extrapolation to the Statewide Industry
Exhibit 14-10, on the following page, shows the extrap-
olation of vapor recovery costs to the statewide industry
in Illinois. The estimates are based on the following:
In Illinois, 75 percent of the bulk gasoline
plants can be characterized by Model Plant A
and the remaining can be characterized by Model
Plant B
All bulk plants will implement the Control Alter-
native I or II vapor control system to comply with
RACT. Since Control Alternative II costs are sim-
ilar to Control Alternative I costs, it was not nec-
essary to define separate model plants for Control
Alternative II.
Actual costs to bulk plant operators may vary depending on
the type of control alternative and manufacturer's equipment
selected by each bulk plant operator.
Based on the above assumptions, the total cost to
the industry for installing vapor recovery equipment is
estimated to exceed $17 million. The annual cost per ton of
emissions controlled is estimated to be $615 per ton.
The statewide costs of vapor control systems by size of
bulk gasoline plant are analyzed with arrayed in Exhibit 14-11,
following Exhibit 14-10. It is noted that bulk plants with
throughput less than 4,000 gallons per day achieve only
20-percent reduction in overall emissions yet bear over 45
percent of the annual cost of hydrocarbon emission control.
Costs for each throughput class were determined by multiplying
the number of plants in each class by the net annualized cost
for the model plant characterized for that throughput class.
Emissions were allocated based on estimated total throughput
for each throughput class.
14-15
-------
Exhibit 14-10
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL
SYSTEMS FOR BULK GASOLINE PLANTS
Characteristic/Cost, Item
Number of facilities
Total annual throughput
(billions of gallons)
Uncontrolled emissions (current)
(tons/year)
Emission reduction
(tons/year)
Net emissions (after control)
(tons/year)
Installed capital
($ million, 1977)
Direct annual operating
cost ($ million, 1977)
Annual capital charges
($-millions, 1977)
< a
Annual gasoline credit
($, 1977)
Net annualized cost
($ millions, 1977)
Annual cost per ton of
emissions reduced
($ per ton)
Data
1,126
1.241
11,500
7,782
3,718
17.11
a 513
4.277
0
4.79
615
a. Based on reduced emissions remaining at bulk plant since there is
no conversion from splash fill to submerge fill required.
Sources Booz, Allen & Hamilton, Inc.
-------
Exhibit 14-11
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL
SYSTEM BY SIZE OF BULK GASOLINE PLANT
Bulk Plant Gasoline
Throughput
Percentage
of Plants
(gallons per day)
Less than 2,000
2,000 -
4,000 -
6,000 -
8,000 -
10,000 -
12,000 -
14,000 -
16,000 -
18,000 -
3,999
5,999
7,999
9,999
11,999
13,999
15,999
17,999
20,000
24
27
16
8
12
4
1
2
1
5
Current
Estimated
Annual VOC
Emissions
(tons per year)
736
1,667
1,644
1,150
2,219
908
253
622
346
1,955
Estimated
Annual VOC
Emissions After
RACT Control
(tons per year)
238
539
532
372
717
294
82
200
112
632
Not
VOC Fmission
Reduction
(tons per year)
498
1,128
1,112
778
1,502
614
171
422
234
1.323
Percentage
of Total VOC
Emissions
Reduced
Fst incited
Annual Cost
Percent of
Total Annual
Cost For
Vapor Recovery
(S millions, 1977)
6.4
14.5
14.3
10.0
19.3
7.9
2.2
5.4
3.0
17.0
1.015
1 . 166
. 614
. 149
. 744
.24K
.060
. 121
. 060
. 30S
21
24
14
7 .
15,
V
1 .
2.
1.
6.
.63
. 36
.50
. 29
.54
.18
, 25
52
25
43
Net Hydrocarbon
Cost
Effectiveness
( 5. 177; I
\tons per year/
2.07R
1,031
624
448
49S
403
350
286
256
232
Source: Booz, Allen S Hamilton Inc.
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14. 5 DIRECT ECONOMIC IMPLICATIONS
This section presents the direct economic implications
of implementing RACT controls to the statewide industry,
including availability of equipment and capital; feasibility
of the control technology; and impact on economic indicators,
such as value of shipments, unit price (assuming full cost
passthrough), state economic variables and capital investment.
14.5.1 RACT Timing
RACT must be implemented statewide by January 1, 1982.
This implies that bulk gasoline plant operators must have
vapor control equipment installed and operating within
the next three years. The timing requirements of RACT
impose several requirements on bulk plant operators
including:
Determining appropriate vapor control system
Raising capital to purchase equipment
Generating sufficient income from current opera-
tions to pay the additional annual operating
costs incurred with vapor control
Acquiring the necessary vapor control equipment
Installing and testing vapor control equipment to
insure that the system complies with RACT.
The sections which follow discuss the feasibility and the
economic implications of implementing RACT within the
required timeframe.
14.5.2 Feasibility Issues
Technical and economic feasibility issues of implement-
ing RACT controls are discussed in this section.
Several bulk plants in the U.S. have attempted to implement
vapor control systems with varying degrees of success. One
bulk plant operator interviewed in Maryland implemented vapor
recovery at a cost of $65,000 in 1974. The operator indicated
that recent tests have shown the system operates well within
the 90 percent recovery requirement of RACT. This particular
bulk plant was converted to bottom filling and completely
vapor balanced. The plant's throughput was 20,000 gallons
14-16
-------
per day and included one loading rack and three account
trucks. This plant would be characterized as installing a
sophisticated Alternative III control system. The plant
is also operated by a major oil company, so capital avail-
ability problems were minimized.
Bulk plants in the Houston/Calveston area, on the
contrary, have implemented "bare bone" type control systems
that were individually designed and installed at a bulk
plant which was owned by a major oil company. No emission
data are available to verify whether these systems are in
compliance, but U.S. EPA estimates that these control systems
are sufficient to meet the requirements of RACT. These
systems are not marketed by any equipment manufacturer;
therefore, their availability for widespread application
may be doubtful at the present time.
State adoption of RACT regulations will generate a
demand for economical vapor control systems for bulk plants.
It is, therefore, anticipated that off-the-shelf systems
could be developed within the next four years that are
similar to the control system implemented in the Houston/
Galyeston area; thus making the delivery of RACT control
equipment feasible.
A number of economic factors are involved in determining
whether a specific bulk plant operator will be able to
implement vapor control systems and still remain profitable.
These include:
Degree of competition
Ability to pass on a price increase
The current profitability of the plant
Age of the plant
State of repair of the plant
Ownership—major oil company or private individual.
It is estimated that small bulk plants, with throughput
less than 4,000 gallons per day, will experience a direct
cost increase of nearly 0.5 cents per gallon if they implement
RACT.1 This will affect an estimated 50 percent of the bulk
plants in the state. Many of these plants may be located in
rural areas.
The key to the direct economic impact will be the
ability of a bulk plant operator to pass on up to a 0.5
cent increase in the price of gasoline to customers (assuming •
a full cost passthrough). One small bulk plant operator
in Missouri reported during an interview that his gross
Estimated based on dividing net annual cost for Model
Plant A by annual throughput for a 4000 gallon per day
bulk plant. This assumes full cost passthrough.
14-17
-------
profit margin per gallon of gasoline is 4 to 5 cents per
gallon. His net profit margin is 0.5 cent per gallon.
This operator stated that he plans to discontinue operations
rather than comply with RACT. Again, sufficient data are
not available to determine if this would be typical of
small bulk plants in the state. In a previous study of
the economics of vapor recovery for small bulk plants, a
trend of declining profitability in bulk plant operations
•was identified.1 If this trend continues, vapor control
systems may not be affordable at marginal plants. Many
bulk plants now operate at a profit only because their
plants are fully depreciated. In the same study it was
also determined that a large percentage of small bulk
plants may not be able to raise sufficient capital to
purchase vapor control equipment. Furthermore, it is
estimated that the price of vapor control systems is likely
to increase in the future at a rate greater than the GNP.
One bulk plant operator stated that prices for vapor control
have risen 30 percent over the past three years. Industry
decline may continue and some bulk plant operators may cease
operations because of their present financial condition and
the additional financial burden of the RACT requirements.
The paragraphs which follow compare statewide compliance
costs of RACT control, in 1977 dollars, to various economic
indicators.
14.5.3 Comparison of Direct Cost With Selected Direct
Economic Indicators
This section presents a comparison of the net increase
in the annual operating cost of implementing RACT with
the total value of gasoline sold in the state, the value
of wholesale trade in the state, and the unit price of
gasoline.
The net increase in the annualized cost to the
bulk gasoline plants due to RACT represents 0.9 percent of
the total gasoline sold in the state. When compared to the
statewide value of wholesale trade, these annual cost in-
creases represent 0.01 percent. The impact on the unit
price of gasoline varies with the bulk plant throughput.
As discussed in the preceding section, the small bulk plants
1
Economic Analysis of Vapor Recovery Systems on Small Bulk
Plants, EPA 340/1-77-013, September 1976.
14-18
-------
may experience a direct cost increase of up to 0.5 cent per
gallon of gasoline sold, whereas the large bulk plants may
experience a much smaller direct cost increase.
Assuming a full cost passthrough, the price of gasoline
is likely to rise more in rural areas than urban areas
(i.e., the small volume bulk plants tend to be located in
rural areas).
14-19
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14.6 SELECTED SECONDARY ECONOMIC IMPACTS
This section discusses the secondary impact of imple-
meting RACT on employment, market structure, and productiv-
ity.
\
For bulk gasoline plants that comply with the RACT
.requirements, manpower requirements are not likely to be
required. Overall bulk gasoline plant industrial sector
employment may continue to decline'if the number of bulk
gasoline plants operating in the state declines further.
Based on the statewide estimates of number of employees
and number of bulk plants, an average of approximately 4.6
jobs could be lost with the closing of a bulk plant. No
estimate was made of the number of bulk plants that might
closed due to RACT.
The impact on the market structure for bulk plants
differs significantly in urban and rural areas.. The
importance of bulk plants in the urban areas is apparently
declining because of competition from retailers and tank
truck terminals and may continue to decline regardless of
RACT requirements.
In rural areas, the bulk plants serve as a vital link
in the gasoline distribution network, since large trailer
transport trucks cannot be accommodated by many rural roads
serving the farm accounts. It is estimated that approximately
60 percent of the customers served by the small bulk plants
in the rural areas are farm accounts, which could be severely
impacted if the small bulk plants decide to go out of business.
The increased annualized cost of complying with RACT nay create
market imbalances if the compliance cost cannot be passed on
to the market place in terms of a price increase (i. e., the
market structure would tend to concentrate further). As small
bulk plant operators cease operation, the supply of fuel to some
farmers may be threatened. Bulk plants not equipped with vapor
control equipment may not be able to serve gasoline service sta-
tions equipped with vapor control equipment due to incompatible
hardware configurations. A uniform -policy, therefore is nec-
essary so that market disruptions due to equipment incompatibil-
ity are minimized.
The productivity of a specific bulk plant will be a
function of the type of vapor control system installed.
If a bulk plant converts to bottom filling along with vapor
recovery, the productivity of the bulk plant should increase.
14-20
-------
However, some vapor control systems may decrease plant
productivity if flow rates substantially decline, requiring
longer times to load and unload trucks.
Exhibit 14-12, on the following page, presents a summary
of the findings of this report.
14-21
-------
Exhibit 14-12
U.S. Environmental Protectior. Agency
SUMMARY OF DIRZCT ECONOMIC IIIPLICATICNS CF
IMPU-1ENTING RACT FOR SULK GASOLINE PLANTS I:.1 Ili:::C
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
ecohomy
Current industry technology trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Discussion
1,100
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after control
Cost effectiveness
1977 industry salss were 3527 million. The
estimated annual throughput was 1.24 billion
gallons
Only small percent of industry has new/modern
ized plants
11,500 tons per year
Top submerge or bottom fill and vapor balanc:
(cost analysis reflects top submerged fill, i
bottom fill)
Discussion
$17.11 million
$4.79 million (approximately 0.9 percent of
value of shipnent)
Assuming a "direct cost passthrough"
Industrywide—$.0034 per gallon increase
. Small operations— $.005 per gallon
increase
Assuming full recovery of gasoline—net savin
of 62,000 equivalent barrels annually
No major impact
No direct impact, however for plants closing,
potential average of 4.6 jobs lost per plant
closed
Regulation could further concentrate a declin
industry. Many small bulk gas plants today a
marginal operations; further cost increases
could result in some plant closings
Potential severe economic impact for small bv
plant operations. Regulation could cause
further market imbalances. Control efficienc
of cost effective alternatives has not been
effectively demonstrated
3,700 tons per year
$615 annualized cost/annual ton of VOC reduct.
Source: Booz, Allen & Hamilton, Inc.
-------
BIBLIOGRAPHY
National Petroleum Newsfact Book, 1967,
McGraw Hill, Mid-May 1976.
National Petroleum Newsfact Book,'1977,
McGraw Hill, Mid-May 1977.
National Petroleum Newsfact Book, 1978,
McGraw Hill, Mid-June 1978.
Economic Analysis of Vapor Recovery Systems on Small
Bulk Plants, EPA 340/1-77-013, September 1976.
Stage I Vapor Recovery and Small Bulk Plants in
Washington, D.C., Baltimore, Maryland, and Houston/
Galveston, Texas, EPA 340/1-77-010, April 1977.
Evaluation of Top Loading Vapor Balance Systems for
Small Bulk Plants, EPA 340/1-77-014, April 1977.
Regulatory Guidance for Control of Volatile Organic
Compound Emissions from 15 Categories of Stationary
Sources, EPA 905/2-78-001, April 1978.
Systems and Costs to Control Hydrocarbon Emissions
from Stationary Sources, PB-236 921, Environmental
Protection Agency, September 1974.
Control of Volatile Organic Emissions from Bulk Gasoline
Plants, EPA 450/2-77-035, December 1977.
Memorandum "Meeting with EPA and Others on Bulk
Plant Vapor Recovery," National Oil Jobbers Council,
Mr. Bob Bassman, Counsel, March 21, 1978.
Letter to Mr. William F. Hamilton, Economic Analysis
Branch, United States Environmental Protection
Agency, from California Independent Oil Marketers
Association, February 28, 1978.
-------
Private conversation with Mr. Clark Houghton,
Missouri bulk plant operator.
Private conversation with Mr. D. L. Adams,
Phillips Petroleum, Towson, Maryland.
Private conversation with Mr. Robert Schuster,
bulk plant operator in Escondido, California.
Private conversation with Mr. Burton McCormick,
bulk plant operator in Santa Barbara, California.
"The Lundburg Letter," Pele-Drop, North Hollywood
California.
"1978 Marketing Directory and Yearbook,"
Michigan Petroleum Association, 1978.
Private conversation with Mr. William Deutsch,
Illinois Petroleum Marketers Association,
Springfield, Illinois.
-------
-------
15.0 STORAGE OF PETROLEUM
LIQUIDS IN FIXED-ROOF
TANKS IN ILLINOIS
-------
-------
15.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
STORAGE OF PETROLEUM LIQUIDS
IN FIXED-ROOF TANKS IN THE
STATE OF ILLINOIS
Under the direction of the Illinois EPA the economic
impact of implementing RACT for the storage of petroleum
liquids in fixed-roof tanks was not studied in detail at
Booz, Allen. It was originally felt by the Illinois EPA
that the economic impact would be minimal due to an existing
regulation, Illinois Rule 205(a).
Illinois Rule 205(a) currently requires floating roofs
or equivalent control on fixed-roof tanks of more than 40,000
gallon capacity, with the exception of tanks located in rural
areas and certain tanks containing Illinois crude oil. Imple-
mentation of RACT would require control for those tanks cur-
rently exempted under Rule 205(a) and effected by the RACT
limitations.
It was recently estimated that there may be approximately
100 fixed roofs exempted under Rule 205(a) potentially affected
by the RACT limitations.
Although this study does not address the control costs of
fixed roof tanks, the economic impact may be significant for
control requirements of approximately 100 tanks in the state of
Illinois.
15-1
-------
-------
16.0 THE ECONOMIC IMPACT OF
'IMPLEMENTING RACT STAGE I
FOR GASOLINE SERVICE STATIONS
IN THE STATE OF ILLINOIS
-------
-------
16.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT STAGE I
FOR GASOLINE SERVICE STATIONS
IN THE STATE OF ILLINOIS
This chapter presents a detailed analysis of implement-
ing RACT Stage I controls for gasoline service stations
in the State of Illinois. The chapter is divided into six
sections including:
Specific methodology and quality of estimates
Industry statistics
The technical situation of the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic implications
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of
gasoline service station vapor recovery, interviews and
analysis.
16-1
-------
16.1 SPECIFIC METHODOLOGY AND QUALITY
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Processes for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for gasoline service stations in the State of Illinois.
The quality of the estimates based on a three point
scale is described in detail in the latter part of this
section.
16.1.1 Industry Statistics
Industry statistics on gasoline service stations were
obtained from several sources. All data were converted to
a base year, 1977, based on specific scaling factors. The
number of service stations for 1977 was provided by the
Illinois Environmental Protection Agency (EPA). The number
of "non.rservice stations" was estimated to be an additional 137
percent of the number of service stations in the state, based
on a study entitled, The Economic Impact of Vapor Recovery
Regulations on the Service Station Industry-i. The number
of employees in 1977 was determined by multiplying the
national average number of employees per service station
(3.5) by the number of establishments in the state which was
reported in 1977. The number of employees at "non-service"
stations is estimated to be two employees per facility. The
number of gallons of gasoline sold in 1977 in the state was
reported in the National Petroleum News Factbook, 1978 p.78.
Sales, in dollars, of motor gasoline for 1977 were estimated
by multiplying the number of gallons of gasoline sold in
1977 by the average national service station price (excluding
tax) in 1977 (50.7C/gallon) which was also reported in the
National Petroleum News Factbook, 1978.
16.1.2 VOC Emissions
VOC emissions for gasoline service stations were
estimated by applying U.S. EPA emission factors to the
1977 gasoline throughput.
Prepared for the Department of Labor, OSHA, C79911, March 1978,
pp. 4-7.
16-2
-------
16.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for gasoline
service stations are described in Design Criteria for Stage
I Vapor Control Systems Gasoline Service Stations.This
document provides data on alternative methods available for
controlling VOC emissions from gasoline service stations.
Several studies of VOC emission control were also analyzed
in detail and interviews with petroleum trade associations,
gasoline service station operators and vapor control equip-
ment manufacturers were conducted to ascertain the most
likely types of equipment which would be used in gasoline
service stations in Illinois. The specific studies analyzed
were: Economic Impact of Stage II Vapor Recovery Regula-
tions; Working Memoranda, EPA-450/2-76-042; A Study of
Vapor Control Methods for Gasoline Marketing Operations,
PB-246-008, Radian Corporation; Reliability Study of Vapor
Recovery Systems at Service Stations, EPA-450/3-76-001;
Technical Support Document Stage I Vapor Recovery at Service
Stations, draft, Illinois Environmental Protection Agency.
16.1.4 Cost of Vapor Control Systems
The costs of vapor control systems were developed by:
Developing costs of two different control systems
for a model service station including:
Installed capital cost
Direct operating costs
Annual capital charges
Gasoline credit
Net annual cost
Aggregating costs to the statewide gasoline station
industry.
Costs were determined from analyses of the studies
listed previously and from interviews with petroleum mar-
keters' associations, gasoline service station operators
and vapor control equipment manufacturers.
It was assumed that 75 percent of the gasoline dispensing
facilities would install coaxial or concentric vapor balance
systems, and the remaining 25 percent would install the two
point vapor balance system based on interviews with gasoline
service station dealer trade associations. Costs for the two
systems are assumed to be represented by the costs developed
for the model service station. Statewide costs were projected
16-3
-------
from the model costs. It was assumed that all gasoline
dispensing facilities in the state will be required to meet
the RACT guidelines.
16.1.5 Economic Impacts
The economic impacts were determined by analyzing the
lead time requirements needed to implement RACT; assessing
the feasibility of instituting RACT controls in terms of
capital and equipment availability; comparing the direct
costs of RACT control to various state economic indicators;
and assessing the secondary impacts on market structure,
employment and productivity resulting from implementation
of RACT controls.
16.1.6 Quality of Estimates
Several sources of information were utilized in
assessing the emissions, cost and economic impact of
implementing RACT controls on gasoline service stations.
A rating scheme is presented in this section to indicate
the quality of the data available for use in this study.
A rating of "A" indicates hard data (i.e., data that are
published for the base year); "B" indicates data that were
extrapolated from hard data? and "C" indicates data that
were not available in secondary literature and were estimated
based on interviews, analyses of previous studies and best
engineering judgment. Exhibit 16-1, on the following page,
rates each study output and the overall quality of the data.
16-4
-------
Exhibit 16-1
U.S. Environmental Protection Agency
DATA QUALITY
ABC
Study Outputs Hard Data Extrapolated Estimated
Data Data
Industry statistics
Emissions
Cost of emissions
control
Statewide costs of
emissions
Economic impact
Overall quality of
data
Source: Booz, Allen & Hamilton, Inc.
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16.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business trends
for gasoline service stations are presented in this section.
The discussion includes a description of the number of facil-
ities and their characteristics, a comparison of the size of
the service station industry to state economic indicators, a
historical characterization and description of the industry
and an assessment of future industry patterns. Data in this
section form the basis for assessing the impact on this in-
dustry of implementing RACT to VOC emissions from gasoline
service stations in Illinois.
16.2.1 Size of Industry
There were an estimated 8,302 gasoline service stations
in Illinois in 1977, and an additional estimated -11,373 "non-
service stations" which include gasoline dispensing facil-
ities such as marinas, general aviation facilities, commer-
cial and industrial gasoline consumers and rural operations
with gas pumps. Industry sales were in the range of
$2.75 billion, with a yearly throughput of 5.435 billion
gallons of gasoline. The estimated number of employees
in 1977 was 29,000 employees in service stations and
22,700 employees in "non-service stations" for a total of
51,700 employees. These data and the sources of information
are summarized in Exhibit 16-2, on the following page. Total
capital investments by the service station industry were not
identified, although in general gasoline service station
operators make investments in plant and equipment to replace
worn-out facilities and equipment, modernize the establish-
ments or improve operating efficiencies.
16,2.2 Comparison of Industry to State Economy
The gasoline service station industry is compared to
the economy of the State of Illinois in this section by
comparing industry statistics to state economic indicators.
Employees in the gasoline service station industry represent
approximately 0.95 percent of the total state civilian labor
force of Illinois. The value of gasoline sold from gasoline
service stations represented 12 percent of the total value
of retail trade in Illinois in 1977.
16-5
-------
Exhibit 16-2
U.S. Environmental Protection- Agency
INDUSTRY STATISTICS FOR GASOLINE
SERVICE STATIONS IN ILLINOIS
Number of Facilities Number of Employees
Service Non-Service Service Non-Service
Stations Stations Stations Stations Sales Gasoline Sold
($Billion, 1977) (Billions of Gallons)
8,3023 ll,373b 29,000° 22,700d 2.75e 5.435f
a. State of Illinois.
b. Includes gasoline dispensing facilities such as marinas, general aviation
facilities, commercial and industrial gasoline consumers and rural
operations with gas pumps. The number of facilities is estimated to be 137
percent of the number of service stations.
c. Estimate based on the ratio of the number of employees to the number of
establishments nationally in 1977.
d. Estimate based on two employees per facility.
e. Number of gallons of motor gasoline sold in 1977 multiplied by the national
service station price in 1977 (50.70£/gallon)• National Petroleum News Fact
Book, 1978.
f. National Petroleum News Factbook, 1978.
Source; Booz, Allen & Hamilton Inc.
-------
16.2.3 Characterization of the Industry
Gasoline service stations and retail outlets are the
final distribution point in the petroleum marketing network,
as shown in Exhibit 16-3, on the following page. Several
types of gasoline service station and retail gasoline out-
lets offer services ranging from self-service to full ser-
vice. A general classification of service stations in the
United States is listed in Exhibit 16-4, following Exhibit
16-3, along with the percentage of each type of station
existing nationally in 1977. Service station ownership may
be characterized by one of the following four arrangements:
Supplier owned/supplier operated
Supplier owned/dealer operated
Dealer owned/dealer operated
Convenience store.
An estimated 26 percent of service stations are owned
and operated by the station's supplier of gasoline, 44 percent
are owned by the supplier and leased to a dealer, and 30 ,
percent are owned and operated by an independent dealer.
Gasoline marketing is characterized by high fixed costs,
with operations varying by degree of labor intensity. Con-
ventional service stations (service bay with mechanics on
duty and nongasoline automotive items available) are the
most labor intensive, while self-service "gas and go" sta-
tions exemplify low labor intensity.
Gasoline throughput by geographical area in Illinois
is shown in Exhibit 16-5, following Exhibit 16-4. Approx-
imately one-half of the statewide throughput occurs in the
Chicago area.
The number of gasoline service stations nationally has
been declining since 1972, while the throughput per station
has been rising. This trend is also evident in Illinois and
is predicted to continue. It is estimated that, by 1980,
one-half the gasoline stations in the country will be totally
self-service .2
16.2.4 Gasoline Prices
Gasoline prices vary among types of gasoline stations
within a geographical area. Convenience stores are apt to
have higher pump prices than large self-service "gas and go"
1Economic Impact of Stage II Vapor Recovery Regulations; Working
Memoranda, EPA-450/3-76-042, November 1976, p. 6.
2 Ibid., p. 2.
16-6
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Exhibit 16-3
U.S. Environmental Protection Agency
GASOLINE DISTRIBUTION NETWORK
REFINERY
\/
SMALL VOLUME
ACCOUNTS
AGRICULTURAL
COMMERCIAL
RETAIL
o
TERMINAL
\
\i/ y
T
1
' \ X
BULK
PLANT
t
i
j
i
!
V
LARGE VOLUME
ACCOUNTS
RETAIL
COMMERCIAL
AGRICULTURAL
—o
/v
"i
CUSTOMER
PICK-UP
Typical delivery route of truck-trailer
— — —-*- Typical delivery route of account truck
————*• Typical transaction with consumer coming to supplier
/""S Final Product Usage
Source: Economic Analysis of Vapor Recovery Systems on Small Bulk
Plants, EPA 340/1-77-013, p. 3-2.
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Exhibit 16-4
U.S. Environmental Protection Agencj
CLASSIFICATION OF SERVICE STATIONS
Type of Service Station Percentage of Population
Full-service 41.8
Self-service 9.4
Split island 37.3
Convenience store 4.4
Car wash 4.5
Truck stop 1.9
Mini service 0.7
TOTAL 100.0
Source: National Petroleum News Fact Book, 1978, p. 106
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Exhibit 16-5
U.S. Environmental Protection Agency
GEOGRAPHIC DISTRIBUTION OF GASOLINE
THROUGHPUT IN ILLINOIS
Area
Chicago
(6- counties)
E. St. Louis
(2- counties)
Peoria
(2-counties)
Rock Island
(1-county)
Rockford
(1- county)
Springfield
(1- county)
Decatur
(1-county)
Champaign-Urbana
(1-county)
Bloomington-Normal
(1- county)
Rest of the state
TOTAL
Yearly
Gasoline
Throughput
(1000
gallons:)
2,305,650
199,014
174,744
72,810
106,788
82,518
58,248
77,664
82,518
1,694,046
4,854,000
Source; Illinois Environmental Protection Agency
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stations. The pump price less the dealer tank wagon price
represents the gross margin on a gallon of gasoline. Gaso-
line service station operating costs then must come out of
the gross margin for gasoline as well as the gross margin
for other products which may be sold at the service station
Operating costs vary substantially among the various types
of service stations. It is reported that some service sta-
tions operate with nearly zero net margin or profit, while
others may enjoy up to four to five cents per gallon profit
Sufficient data are not available on service stations in
Illinois to present a thorough analysis of existing price
structures and degree of competition in the industry within
the State
16-7
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16.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents information on gasoline service
station operation, estimated VOC emissions from service
station operations in the state, the extent of current con-
trol in use, the vapor control requirements of RACT and the
likely alternatives which may be used for controlling VOC
emissions from service stations in Illinois.
16.3.1 Gasoline Service Station Operations
Gasoline service stations are the final distribution
point in the gasoline marketing network. Gasoline is deliv-
ered from bulk gasoline plants via account truck or from
the bulk gasoline tank terminal via trailer-transport
truck, stored in underground storage tanks and subsequently
dispensed via pump to motor vehicles. Service stations are
characterized by their services and business operations:
full-service stations, split island stations, self-service
stations, and convenience store operations. In full-service
stations, attendants offer all services, including gasoline
pumping and mechanical check-ups. If fuel is used at any
of the last three classes of stations, the customers may
fill up the tanks themselves. In split island stations,
both self-service and full service are offered. At the
two remaining types of stations, only self-service is
available.
Gasoline service stations and other gasoline dispensing
facilities will be required to comply with Stage I vapor
control by January 1, 1982. The requirements of the regu-
lation will not apply to:
Transfers made at gasoline dispensing facilities
to any stationary tank with a capacity of less
than 2,000 gallons which is in place before
January 1, 1979; or,
Transfers made at gasoline dispensing facilities
to any stationary tank equipped with a floating
roof or its equivalent which has been approved
by the agency; or,
16-8
-------
Transfers made at gasoline dispensing facilities
to any stationary tank with a capacity of less
than 250 gallons which is installed after December
31, 1978; or,
Transfers made to any stationary tank with a
capacity of less than 440 gallons used primarily
for the fueling of agricultural equipment which
is installed after December 31, 1978.
Illinois EPA estimates these exemptions will affect
less than 5 percent of the state throughput of gasoline.
16.3.1.1 Facilities
Equipment used in handling gasoline at gasoline dis-
pensing facilities are: gasoline storage tanks, piping,
and gasoline pumps. The most prevalent type of gasoline
storage tank is the underground tank. It is assumed that
there are typically three storage tanks per facility.^-
Gasoline is dispensed to motor vehicles through pumps, and
there may be anywhere from one to twenty pumps per facility.
Stage I vapor control regulations apply to the delivery
of gasoline to the facility and the subsequent storage in
underground tanks.
16.3.1.3 Operations
Uncontrolled VOC emissions at service stations come
from loading and unloading losses from tank trucks and under-
ground tanks, refueling losses from vehicle tanks and
breathing losses from the underground tank vent. Stage I
vapor control applies to losses from tank truck unloading
and working and breathing losses from underground storage
tanks.
Tank trucks are unloaded into underground storage tanks
either by splash loading or submerged loading. Splash
loading results in greater emissions than submerged loading.
More specifically, more losses occur when:
Organic liquids vaporize into the air that is
drawn into the tank truck compartment during
unloading of the tank truck.
Hydrocarbon Control Strategies for Gasoline Marketing Operations,
EPA-450/3-78-017.
16-9
-------
Vapors are displaced from the underground storage
tank during tank loading.
Changes in temperature and pressure in the under-
ground storage tank result in vapors being vented
to the atmosphere.
The control measures involve vapor balancing between
the tank truck and storage tank and submerged filling of the
gasoline storage tank. Vapor recovery systems are also avail-
able for emission control when combined with a vapor balancing
system.
Since most storage tanks at gasoline service stations
are relatively small and underground, it is unlikely that
they are equipped with sophisticated control equipment. The
breathing losses, therefore, can be controlled only by ad-
justing the pressure relief valve.
16.3.2 Emissions and Current Controls
This section presents the estimated VOC emissions from
gasoline service stations in Illinois in 1977 and the current
level of emission control already implemented in the state.
Exhibit 16-6, on the following page, shows the total es-
timated emissions in tons per year from gasoline service
stations in Illinois. Emissions were calculated
based on gasoline throughput and are estimated to be 48,923
tons per year.
Illinois EPA determined that nearly all storage tank
loading was by the submerge fill method based on their
interviews with industry.
16.3.3 RACT Guidelines
The RACT guidelines for Stage I VOC emission control
from gasoline service stations require the following con-
trols:
Submerged fill of gasoline storage tanks
Vapor balancing between the truck and the gasoline
storage tank
Proper operation and maintenance of equipment.
16-10
-------
Exhibit 16-6
U.S. Environmental Protection Agency
VOC EMISSIONS FROM GASOLINE
SERVICE STATIONS
Estimated
Number of
Facilities Average Yearly Throughput Total Emissions
(Millions of Gallons) (Tons/Year)
19,675 5,435 48,923
Source; Booz, Allen & Hamilton Inc.
-------
Exhibit 16-7, on the following page, summarizes the RACT
guidelines for VOC emissions control from gasoline service
stations.
16.3.4 Selection of the Most Likely RACT Alternatives
Stage I control of VOC emissions from gasoline service
stations is achieved using submerged filling of storage tanks
and vapor balancing between the unloading of incoming tank
trucks and the gasoline storage tanks. There are alternative
means of achieving vapor balance based primarily on the method
of connecting the vapor return line to the gasoline storage
tank. The two primary methods for connecting vapor return
lines, two point connection and coaxial or concentric con-
nection (often referred to as tube-in-tube connection), are
described in Sections 16.3.4.2 and 16.3.4.3.
16.3.4.1 Vapor Balance System
The purpose of the vapor balance system is to return
displaced vapors from the underground gasoline storage tank
to the tank truck during storage tank loading. There are
two basic versions of vapor balancing for Stage I.
The "two point" method depicted in Exhibit 16-8, fol-
lowing Exhibit 16-7, shows a storage tank with two risers.
One riser is for fuel delivery and the other is for returning
vapors to the tank truck. The other method, "concentric or
coaxial system," shown in Exhibit 16-9, employs a concentric
liquid vapor return line, thus requiring only one tank riser.
The vapor balance systems use flexible hoses carrying
liquid gasoline from the tank truck down a drop tube to the
underground storage tank. Entering liquid forces the air-
hydrocarbon mixture in the storage tank out through a flex-
ible vapor return hose to the tank truck. At the truck, the
vapor return hose is connected to a piping manifold which is
interconnected with the truck compartments by vents. The
vents are opened selectively during truck unloading, allow-
ing returning vapors from the underground tank to enter
respective product compartments on the truck.
16.3.4.2 Two Point Vapor Balance System
The most effective method of transferring displaced
vapors from the underground tank to the truck is by using
16-11
-------
Exhibit 16-7
U.S. Environmental Protection Agency
VOC EMISSION CONTROL TECHNOLOGY FOR
GASOLINE SERVICE STATIONS
Facilities
Affected
Sources of
Emissions
Gasoline service
stations and gas-
oline dispensing
facilities
Storage tank fill-
ing and unloading
tank truck
RACT Control
Guidelines
Stage I vapor control
system, i.e. vapor
balance system which
returns vapors dis-
placed from the stor-
age tank to the truck
during storage tank
filling; and submerge
filling
Source; Design Criteria for Stage I Vapor Control Systems,
Gasoline Service Stations, U.S. EPA, November 1975.
-------
Exhibit 16-8
U.S. Environmental Protection Agency
STAGE I VAPOR CONTROL SYSTEM -
VAPOR BALANCING WITH SEPARATE LIQUID-VAPOR RI-
Cc. p 11 Li'«-nc
Vent V«1vcs
Ortffcc or T-V Vjlve
Unless Pru'l.iCt jnd
Vjpir Huii^ «rt
Jnttrlocl.td.
V*(>or Return
Hose (j" ID)
Va;/or bilac«:)nj with
STdiate liquid - vtpor
risers.
Design Criteria for Stage I Vapor Control Systems Gasoline
Service Stations, U.S. EPA, November 1975
-------
Exhibit 16-9
U.S. Environmental Protection Agency
STAGE I VAPOR CONTROL SYSTEM -
VAPOR BALANCING WITH CONCENTRIC LIQUID-VAPOR RISERS
Orifice or P-Y VaUe
Product «nd
Vij.or ll;scs jre
Interlocked.
Cr.yl.rcik,
Interlock or
1 ;r,c-nt
Source; Design Criteria for Stage I Vapor Control Systems Gasoline
Service Stations. U.S. EPA November 1975
-------
a separate connection to the underground storage tank for
the vapor return hose as shown in Exhibit 16-8. Equipment
costs for this type of system are less expensive than for
the coaxial or concentric system, although installation costs
are considerably higher. U.S. EPA has tested this type of
system to show that it complies to RACT requirements. It is
•estimated that 25 percent of the service stations would in-
stall the two point system featuring a higher cost but
achieving greater efficiency, based on information from
industry interviews.
16.3.4.3 Concentric or Coaxial Vapor Balance Systems
At some gasoline service stations, a separate riser is
not available on storage tanks or the gasoline service sta-
tion operator does not wish to incur the additional instal-
lation expense to excavate to an unused entry to install a
separate riser. For these cases, coaxial devices have been
developed to remove vapors from the same opening through
which the fuel is delivered.
As shown in Exhibit 16-9, a drop tube of smaller diameter
is inserted in the existing fuel riser. The vapors exit
through the annular space. A coaxial adaptor fits on the
riser and provides connections for the fuel delivery hose and
the vapor return hose. In the other system, the fuel and
vapor passages are separated in a "Y" fitting which is per-
manently attached to the underground tank. The fittings for
the hose connections are located in a conventional manhole.
Most of these coaxial devices provide less cross-sectional
area in the vapor return passage than do separate connectors
and tend to reduce vapor recovery efficiency and gasoline
storage tank fill rates to some extent. It is estimated
that 75 percent of t he gasoline service stations would in-
stall this type of system due to the lower installed cost
of the system.
16.3.4.4 Manifolded Vent Lines
Several schemes have been used to manifold vents from
two or more tanks to a common vapor hose connection. Mani-
folding may be above or below grade. A number of configura-
tions have been developed for use with suitable vent restric-
tions. A three-way connector provides the most effective
arrangement since connection of the vapor hose to the common
connector blocks flow to the atmosphere and routes all dis-
placed vapor to the tank truck. In any manifold piping
system, care must be exercised to prevent contamination of
"no-lead" gasoline products.
16-12
-------
16.3.4.5 Drop Tubes for Submerged Filling
Submerged fill is required by Stage I vapor control.
The submerged fill requirement means use of a drop tube
extending to within six inches of the storage tank bottom.
Under normal industry practices, a tube meeting this spec-
ification will always be submerged since the storage tanks
are not pumped dry.
16-13
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16.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATIONS FOR
STAGE I RACT REQUIREMENTS
Costs for VOC emission control equipment are presented
in this section. The costs for a typical gasoline service
station are described, followed by an extrapolation to the
statewide industry.
16.4.1 Costs for Vapor Control Systems
The costs for vapor control systems were derived from
analysis of the petroleum marketing trade association data and
from previous cost and economic studies of gasoline service
stations, and are summarized for a typical gasoline service
station in Exhibit 16-10, on the following page. The cost
has been estimated as follows: capital costs of installing
vapor-balance equipment at existing service stations are
about $2,000 per station. This cost includes equipment costs
($300-$500) and installation ($1,300-$1,600)-1 The installed
capital costs for a coaxial or concentric system is reported
by U.S. EPA to be $150 to $200 per tank, including parts and
labor. Annualized capital costs are estimated at 25 percent
of installed capital cost and include interest, depreciation,
taxes and maintenance. This cost analysis does not consider
the cost of tank truck modification. The cost of modification
of trucks to receive the displaced vapors is about $2,000-$3,000
per truck. It is assumed that the service station operator
does not own the tank truck and, therefore, will not bear
this cost.
Stage I vapor control at service stations will not
increase direct annual operating costs. Gasoline credit
is not included in Exhibit 16-9, but it will be included
in the statewide costs in the next section. The net
annualized cost for a typical gasoline service station is
estimated to be $500 for the two point system and $150
for the concentric or coaxial system.
1- Air Pollution Control Technology Applicable to 26 Sources of
Organic Compounds, U.S. Environmental Protection Agency, May 27 ,
1977. (This cost includes excavation and construction of mani-
folded storage tanks.)
16-14
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Exhibit 16-10
U.S. Environmental Protection Agency
STAGE I VAPOR CONTROL COSTS FOR A
TYPICAL GASOLINE SERVICE STATION
Description of Model Gasoline Station
Monthly throughput (gallons) 40,000
Number of storage tanks 3
Costs
($, 1977)
Coaxial or
Two Point Concentric
System System
Installed capital cost 2,000 600
Annualized capital charges 500 150
Direct operating cost 0 0
Net annualized cost 500 150
a. Twenty-five percent of installed capital cost.
Includes depreciation, interest, taxes, insurance
and maintenance.
Source; Booz, Allen & Hamilton Inc.
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16.4.2 Extrapolation to the Statewide Industry
This section presents an extrapolation of vapor control
costs to the statewide industry. An estimated 41 service
stations and 4,094 non-service stations may be exempted from the
Illinois regulation since these facilities are deemed to have
storage tanks less than 2,000 gallon capacity. These facilities
are excluded in the statewide cost analysis. Exempted facilities
were estimated from national data presented in The Economic
impact of Vapor Recovery Regulations on the Service Station
Industry, p. fl~. ~~~
Exhibit 16-11, on the following page, shows the extra-
polation of vapor control costs to the statewide industry
based on the costs for a typical gasoline service station.
It should be noted that actual costs to service station
operators may vary depending on the type of control method
and manufacturer's equipment selected by each service station
operator.
The total cost to the industry for installing vapor
control equipment is estimated to exceed $14.7 million.
The annual cost per ton of emission controlled is estimated
to be $203 per ton.
The distribution of the statewide costs and emissions
reduction by the size of gasoline service stations based
on throughput is shown in Exhibit 16-12, following Exhibit
16-11. Based on these data, gasoline service stations with
throughput less than 24,000 gallons per month account for
45 percent of the estimated statewide cost of control, but
only 23 percent of the estimated emissions reduction for
gasoline service stations.
16-15
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EXHIBIT 16-11
U.S. Environmental Protection Agency
STATEWIDE COSTS FOR STAGE I VAPOR
CONTROL OF GASOLINE SERVICE STATIONS
Summary of Costs
Estimated number of affected facilities 15,540
Estimated annual throughput from affected 5.187
facilitiesa (billions of gallons)
1977 VOC actual emissions (all facilities) 48,923
(tons/year)
Emissions reduction 18,157
(tons/year)
Emissions after reduction 30,766
(tons/year)
Installed capital 14.763
($ millions)
Annualized capital cost 3.69
($ millions)
Annual gasoline creditc 0
($ millions)
Net annualized cost 3.69
($ millions)
Annual cost per ton of emissions reduced 203
($ per ton/year)
a. Assume 5,000 gallons per month at each affected facility.
b. Emission reduction results from vapor balancing the affected
facilitiies.
c. No gasoline credit since top submerged fill is currently imple-
mented .
Source: Booz, Allen & Hamilton Inc.
-------
Current Estimated
Gasoline Dispensing Percentage3 Percentage'1 Annual
Facility Throughout of Facilities of Volume voc Emissions
(000 gallons per month) (tons per ye.ir)
10 4.5 1 489
11-24 40.7 22 10,763
25-49 31.2 30 14,676
50-99 18.7 33 16,144
100 4.9 14 6,849
Exhibit 16-12
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL
SYSTEMS BY SIZE OF GASOLINE
DISPENSING FACILITY IN ILLINOIS
Estimated
Annual VOf
Emission After
RACT ' pnt t ci 1
Net VOf
TmisR ion
. . . -
299
6,577
8.969
9,866
4,185
190
4,185
5,707
6,278
2,663
Total voc
Emissions P"
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16.5 DIRECT ECONOMIC IMPLICATIONS
This section presents the direct economic implications
of implementing Stage I RACT controls to the statewide
industry including availability of equipment and capital;
feasibility of the control technology; and impact on economic
indicators, such as value of shipments, unit price, state
'economic variables and capital investment.
16.5.1 RACT Timing
RACT must be implemented statewide by January 1, 1982.
This means that gasoline service station operators must
have vapor control equipment installed and operating within
the next three years. The timing requirements of RACT impose
several requirements on service station operators including:
Determining the appropriate method of vapor balancing
Raising capital to purchase equipment
Generating sufficient income from current opera-
tions to pay the additional annual operating
costs incurred with vapor control
Acquiring the necessary vapor control equipment
Installing and testing vapor control equipment to
insure that the system complies with RACT.
The sections which follow discuss the feasibility and
economic impacts of meeting the above requirements within
the required timeframe.
16.5.2 Feasibility Issues
Technical and economic feasibility issues of implement-
ing RACT-controls are discussed in this section.
Gasoline service stations in several air quality control
regions of the United States have successfully implemented
Stage I vapor control systems.
State adoption of Stage I RACT regulations will generate
additional demand for the vapor control systems for gasoline
service stations. However, it is estimated that off-the-shelf
systems will be readily available within the next three years
thus making the implementation of Stage I RACT technically
feasible.
16-16
-------
A number of economic factors are involved in determining
whether a specific service station operator will be able to
implement vapor control systems and still remain profitable.
These include:
Ability to obtain financing
. . Ownership—major oil company or private individual
Ability to pass on a price increase
The current profitability of the service station
Age of the station.
A major finding in a study on gasoline service station
vapor control was that small service stations could have
problems raising the necessary capital to purchase and in-
stall vapor control equipment. The inability to raise the
necessary capital to install vapor control equipment is ,
predicted to cause the closing of some service stations.
Service stations that are owned by major oil companies
may have better access to capital than privately owned ser-
vice stations. A private service station owner may have to
borrow capital from local banks, friends or relatives, whereas
a station owned by a major oil company may receive funding
out of the oil company's capital budget.
It is estimated that small gasoline service stations with
throughput less than 10,000 gallons per month (which represent
approximately''4.5 percent of the service stations in the state)
will experience a cost increase of nearly 0.4 cents per
gallon to implement RACT, using the two point vapor balance
system, whereas larger service stations will experience a
much smaller cost increase. This will put the smaller
stations at a competitive disadvantage in terms of passing
on the costs to the customer by raising prices. Recent
experience indicates that temporary disruptions resulting
from Stage I RACT control installation can have serious
impacts on the service station profitability. In an
interview, the- Greater Washington/Maryland Service Station
Association reported that several stations experienced
loss of business for up to three weeks while Stage I
vapor control was being installed. Service station
Economic Impact of Stage II Vapor Recovery Regulations; Working
Memoranda, EPA-450/3-76-042, November 1976.
16-17
-------
driveways were torn up, greatly restricting access to pumps.
In some instances, oil company owned service stations were
sold or closed down because the oil companies did not want
to expend funds for vapor control at these marginally
profitable operations.
The older service stations reportedly will experience
greater cost and temporary loss of business than new gaso-
line stations when implementing Stage I vapor control be-
cause of the more extensive retrofit requirements.
The number of gasoline service stations has been de-
clining nationally over the past few years for a number of
reasons, including a trend towards reducing overhead costs
by building high throughput stations. This trend is likely
to continue whether or not vapor control is required. Im-
plementation of Stage I RACT control may simply accelerate
as marginal operations may opt not to invest in the required
capital costs. Sufficient data for this state are not avail-
able to quantify the magnitude of this impact.
The paragraphs which follow compare statewide costs of
RACT control, in 1977 dollars, to various economic indicators,
16.5.3 Comparison of Direct Cost with Selected Direct
Economic Indicators
This section presents a comparison of the net increase
in the annual operating cost of implementing RACT with the
total value of gasoline sold in the state, the value of re-
tail trade in the state, and the unit price of gasoline.
The net increase in the annualized cost to the gasoline
service station industry from RACT represents 0.14 percent of
the value of the total gasoline sold in the state. Compared
to the statewide value of retail trade, this annual cost
increase is small. The impact of the unit price of gasoline
on individual stations varies with the gasoline service
station throughput.
16-18
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16.6 SELECTED SECONDARY ECONOMIC IMPACTS
This section discusses the secondary impact of imple-
menting RACT on employment, market structure and gasoline
station operation.
Employment is expected to decline, if a number of small,
marginally profitable gasoline service stations cease opera-
tion in lieu of investing capital for compliance with RACT.
Based on the statewide estimates of number of employees and
number of service stations, approximately three jobs will be
lost with the closing of a gasoline service station. No
estimate was made of the total number of service stations
that may close due to RACT.
The market structure is not expected to change sig-
nificantly because of Stage I vapor control requirements.
The industry trend is such that there would be 50 percent
self-service stations by the 1980s. The total number of
stations is predicted to decline, while throughput per sta-
tion is predicted to increase.
The impact on a specific service station operation is
expected to be slight. Fill rates for loading gasoline
storage tanks may decline slightly if coaxial or concentric
vapor hose connections are used.
Exhibit 16-13, on the following page, presents a
summary of the findings of this report.
16-19
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Current Situation
Number of potentially affected
facilities
Indication of relative impor-
tance of industrial section to
state economy
Current industry technology
trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost
(statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emissions after control
Cost effectiveness of control
Exhibit 16-13
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR GASOLINE SERVICE
STATIONS IN THE STATE OF ILLINOIS
Discussion
An estimated 19,675 gasoline dispensing facilities
are located in the statp 15,540 are expected to
be potentially affected.
Industry sales are $2.75 billion with a yearly
throughput of 5.435 billion gallons
Number of stations has been declining and throughput
per station has been increasing. By 1980, one-half
of stations in U.S. will be totally self-service
48,900 tons per year from all station operations
Submerged fill and vapor balance
Discussion
$14.7 million
$3.7 million (approximately 0.14 percent of the
value of gasoline sold)
Assuming a "direct cost pass-through"—approximately
$.001 per gallon increase
Assuming full recovery of gasoline—net savings of
124,000 barrels annually
No major impact
No major impact
Compliance requirements may accelerate the industry
trend towards high throughput stations (i.e., mar-
ginal operations may opt to stop operations)
Older stations face higher retrofit costs—potential
concerns are dislocations during installation
30,700 tons per year from all station operations
$203 annualized cost/annual ton of VOC reduction
Source: Booz, Allen & Kami Iton Inc.
-------
BIBLIOGRAPHY
Economic Impact of Stage II Vapor Recovery Regulations:
Working Memoranda, EPA-450/3-76-042, November 1976.
National Petroleum News Factbook, 1978, McGraw Hill,
Mid-June 1978.
Cost Data-Vapor Recovery Systems at Service Stations,
PB-248 353, September 1975.
Human Exposure to Atmospheric Benzine, EPA Contract
No. 68-01-4314, October 1977.
Reliability Study of Vapor Recovery Systems at Service
Stations, EPA-450/3-76-001, March 1976.
Regulatory Guidance for Control of Volatile Organic
Compound Emissions from 15 Categories of Stationary
Sources, EPA-905/2-78-001, April 1978.
Systems and Costs to Control Hydrocarbon Emissions
from Stationary Sources?, PB-236 921, Environmental
Protection Agency, September 1974.
Private conversation with Mr. Vic Rasheed, Greater
Washington/Maryland Service Station Association.
"The Lundburg Letter," Pele-Drop, North Hollywood,
California.
Revision of Evaporative Hydrocarbon Emission Factors,
Radian Corporation, PB-267 659, August 1976.
A Study of Vapor Control Methods for Gasoline Marketing
Operations, Radian Corporation, PB-246 088, April 1975.
Design Criteria for Stage I Vapor Control Systems
Gasoline Service Stations, U.S. EPA, November 1975.
Hydrocarbon Control Strategies for Gasoline Marketing
Operations, EPA-450/3-78-017, April 1978.
-------
-------
17.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
USE OF CUTBACK ASPHALT
IN THE STATE OF ILLINOIS
-------
-------
17.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
USE OF CUTBACK ASPHALT
IN THE STATE OF ILLINOIS
This chapter presents a detailed analysis of the impact
of implementing RACT for use of cutback asphalt in the State
cof Illinois. The chapter is divided into six sections
'including:
Specific methodology and quality of estimates
Industry statistics
The technical situation in the industry
Cost and VOC reduction benefit evaluations for
the most likely RACT alternatives
Direct economic implications
Selected secondary economic impacts.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of the
use of cutback asphalt, interviews and analysis.
17-1
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17.1 SPECIFIC METHODOLOGY AND QUALITY 0? ESTIMATES
This section describes the methodology for deterir.inine-
estimates of:
Industry statistics
VOC emissions
Controlling of VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for the use of cutback asphalt in Illinois.
An overall assessment of the quality of the estimates
is detailed in the latter part of this section.
17.1.1 Industry Statistics
Industry statistics on the use of cutback asphalt were
obtained from the U.S. Bureau of Mines. Sales in tons
were available for 1976. Sales in 1977 were assumed to be
equal to 1976. The value of shipmentswas calculated by
applying an average unit price of 36 cents per gallon.
17.1.2 VOC Emissions
VOC emissions from the use of cutback asphalt in
Illinois were calculated by multiplying the emission factors
for cutback asphalt by the number of tons of asphalt used.
The emission factor for slow cure asphalt is 0.078 tons per
ton, for medium cure asphalt 0.209 tons per ton, and for
rapid cure asphalt 0.20 tons per ton.^
17.1.3 Process for Controlling VOC Emissions
The process for controlling VOC emissions from the use
of cutback asphalt is decribed in "Control of Volatile
Organic Compounds from Use of Cutback Asphalt,"
EPA-450/2-77-037, and "Air Quality and Energy Conservation
Benefits from Using Emulsions to Replace Cutbacks in'Certain
Paving Operations," EPA-450/12-78-004. Interviews were
conducted with asphalt trade associations, asphalt producers,
and government agencies to gather the most up-to-date
information on costs for cutback asphalt and asphalt emul-
sions, the feasibility of using emulsions in place of cutback
"Control of Volatile Organic Compounds from Use of Cutback
Asphalt," EPA-450/2-77-037, p. 1-3.
17-2
-------
asphalt and the associated cost ir.piications. Other sources
of information were "Mineral Industry Surveys," U.S. Bureau
of Mines; "Magic Carpet, the Story of Asphalt," The Asphalt
Institute; "Technical Support for RACT Cutback Asphalt,"
State of Illinois; and "World Use of Asphalt Emulsion,"
paper by Cyril C. Landis, Armak Company.
17.1.4 Cost of Vapor Control
The costs for control of VOC emissions from the use of
cutback asphalt are incurred by using emulsions in place of
cutback asphalt. These costs include:
Differential cost per gallon of emulsion versus
cutback asphalt
Changes in equipment for applying emulsions in
place of cutback asphalt
Training of personnel to work with asphalt
emulsions in place of cutback asphalt.
Additionally, if every state incorporates the RACT
guidelines, additional plant capacity to produce asphalt
emulsions would have to be created.
Costs were determined from analyses of the studies
listed above and from interviews with asphalt trade asso-
ciations, government agencies and producers and users of
cutback asphalt and emulsions. Differential costs were for
replacing cutback asphalt with asphalt emulsions, and these
costs were extrapolated to the state.
17.1.5 Economic Impacts
The economic impacts were determined by assessing the
feasibility of instituting RACT controls; analyzing the lead
time requirements for implementing RACT; and determining any
changes in employment, productivity and market structure.
17.1.6 Quality of Estimates
Several sources of information were utilized in
assessing the emissions, cost and economic impact of
implementing RACT for the use of cutback asphalt. A rating
scheme is presented in this section to indicate the quality
17-3
-------
of the data available for use in this study. A rating of
"A" indicates hard data (i.e., data that are published for
the base year); "B" indicates data that were extrapolated
from hard data; and "C" indicates data that were not avail-
able in secondary literature and were estimated based on
interviews, analyses of previous studies and best engineering
judgment. Exhibit 17-1, on the following page, rates each
study output listed and the overall quality of the data.
17-4
-------
Industry statistics
Emissions
Cost of emissions
control
Statev.'ide costs of
emissions
Economic impact
Overall quality of
data
Exnibit 17-1
U.S. Enviror.r.er.tai Proteriic;
ABC
Study Outputs Hard Data Extrapolated Estinated
Data Data
Source: Booz, Allen & Hamilton, Inc.
-------
17.2 INDUSTRY STATISTICS
This section presents information on the cutback
asphalt industry, statewide statistics of cutback asphalt
use, and comparison of cutback asphalt consumption to the
statewide value of wholesale trade. A history of the use
of cutback asphalt and its future pattern of use are also
discussed. Data in this section form the basis for assessing
the technical and economic impacts of implementing RACT in
Illinois.
17.2.1 Industry Description
The cutback asphalt industry encompasses the production
and use of cutback asphalt. Cutback asphalt is one product
resulting from the refining and processing of asphalt from
crude oil. Exhibit 17-2, on the following page, depicts hew
asphalt is produced at the refinery and then further processed.
Cutback asphalt is produced from refined asphalt and petroleum
liquids at an asphalt mixing plant. It is then stored in
tanks or loaded into tank trucks and sold to end users, pri-
marily state highway organizations and construction contractors,
Since RACT control requires the use of asphalt emulsions
to replace cutback asphalt, it is necessary to understand how
each of the asphalt types is produced. A discussion of as-
phalt production and use antfears in a later section of this
report.
17.2.2 Size of the Cutback Asphalt User Industry
This report addresses the size of the cutback asphalt
user industry in Illinois. Although some cutback asphalt
may be produced in Illinois, the production industry is not
the focus of this study since RACT requires control of the
use of cutback asphalt. An estimated 269,000 tons of cut-
back asphalt were purchased in Illinois in 1977 at a value
of $24.8 million. The value is based on an estimated average
price per gallon of $0.36.
Cutback asphalt is primarily used in paving in Illinois.
The number of employees involved in cutback asphalt paving
operations in Illinois is unknown although it was estimated
from interviews that there are approximately six employees
per county currently employed in the use of cutback asphalt.
17-5
-------
Exhibit l~-2
U.S. Environmental ?rctect.icr. .-.•:
PETROLEUM ASP K.-.LT F1C/: CH.-.?,:
PETROLEUM ASPHALT FLOW CHART
HOCISS'NC
GASOUN1
SOlVINTS
v- IMOStNE
IIGHT lutNH Oil
OUS
•AFio cuttNc
IIOUIO ASFMAITS
K IMULSIf IID ASPHALTS
CUTBACK
Source:
Asphalt Institute
-------
17.2.3 Comparison to Statewide £cono~y
The value of shipments of cutback asphalt to the
statewide value of wholesale trade in Illinois is aporox-
imately 0.08 percent.
17.2.4 Demand for Cutback Asphalt
In the 1920s and 1930s, cutback asphalt emerged as a
low-cost adequate binder for paving materials that provided
weather resistance and a dust-free surface to respond to the
rapidly growing demand for increased highway mileage brought
on by the increasing numbers of automobiles. After the
Second World War, the sale of cutback asphalts remained at
an almost constant level while the sales and use of asphalt
cement more than quadrupled from 1954 to 1974. Since 1973,
the use of cutback asphalt has decreased. Exhibit 17-3, on
the following page, shows the historical sales nationally
from 1970 to 1976 of asphalt cement, cutback asphalt and
asphalt emulsions.
17.2.5 Prices
Historically, asphalt emulsions were up to 10 percent
less expensive per gallon than cutback asphalt; currently,
the price difference is not appreciable.
17-6
-------
YEAR
Exhibit 17-3
U.S. Environmental Protection Agency
HISTORICAL NATIONAL SALES OF ASPHALT CEMENT,
CUTBACK A.SPHALT AND ASPHALT EMULSIONS
ASPHALT CEMENT
Percent
Use of of Total
CUTBACK ASPHALT
Percent
Use of of Total
ASPHALT EMULSIONS TOTAL
Percent
Use of of Total Use of
(000 of tons)
1970
1971
1972
1973
1974
1975
1976
17,158
17,612
18,046
20,235
19,075
16,324
16,183
72
73
74
74
77
75
75
.7
.0
.2
.0
.4
.7
.3
(000 of tons)
4
3
3
4
3
3
3
,096
,994
,860
,220
,359
,072
,038
17
16
15
15
13
14
14
.4
.7
.9
.6
.6
.2
.2
(000 of tons
2,
2,
2,
2,
2,
2,
2,
341
275
399
585
208
197
254
9.9
9.5
9.9
9.6
9.0
]0.1
10.5
23,594
23,821
24,305
27,040
24,042
21,593
21,474
Source: U.S. Bureau of Mines
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17.3 THE TECHNICAL SITUATION IN THE INDUSTRY
This section presents information on the use and
production of asphalt. The sources and VOC emission
characteristics of cutback asphalt are then described
followed by: estimated statewide VOC emissions from the
use of cutback asphalt; the VOC control measures required
by RACT; and the VOC emission control procedure for use of
cutback asphalt in Illinois.
17.3.1 Asphalt and Its Uses
Asphalt is a by-product of petroleum distillation
(natural or man-made) which has been put to use in many
different ways. In ancient times, asphalt was used in its
natural form to caulk boats and ships, for mortar in masonry
construction and as cement for mending stone tools. In the
present day, asphalt is used primarily for paving and in a
wide range of construction applications including: roofing,
weatherproofing, floor tile, insulating materials, molded
electrical equipment, papers, shingles and coatings.
Asphalt is highly suitable for paving because it is
durable and weather resistent. The types of paving appli-
cations in which asphalt is used range from a thin layer
sprayed on a dirt road to keep down dust, to a heavy duty
pavement of thick layers of asphalt mixed with aggregate
designed to carry heavy traffic. Asphalt pavement may vary
greatly in thicknesses and strengths, depending on the
traffic it will be required to carry.
Three major types of asphalt pavements are currently
in use in the United States:
Asphalt cement
Cutback asphalt
Asphalt emulsions.
Asphalt cement pavements are often referred to as "hot
mix." This type of pavement is not under consideration for
RACT. Cutback and asphalt emulsions fall into the class of
"liquid asphalt" and are discussed in detail since RACT
guidelines specify replacing the use of highly volatile
cutback asphalt with asphalt emulsions.
Cutback asphalts are produced by liquifying asphalt
cement by blending it with a petroleum solvent. Three basic
types of cutback asphalt are:
17-7
-------
Slow cure asphalt, sometimes referred to as road
oil, is composed of asphalt cement and oils cf
low volatility.
Medium curing cutback asphalt is a liquid asphalt
composed of asphalt cement and a kerosene-type
diluent of medium volatility.
• . Rapid curing cutback asphalt is liquid asphalt
composed of asphalt cement and a naphtha of
gasoline-type diluent of high volatility.
Asphalt emulsions are emulsions of asphalt cement and
water which contain a small amount of emulsifying agent.
Asphalt and water are normally immiscible products, but the
emulsifying agent causes the two products to mix.
Cutback and emulsified asphalt are used in nearly all
paving applications. In most applications, cutback asphalt
and asphalt emulsions are sprayed directly on the road sur-
face; the principal other mode is in cold mix applications
normally used for wintertime patching. As cutback asphalt
cures, VOC evaporates to the atmosphere. Asphalt emulsions,
however, consist of asphalt suspended in water, which
evaporates during curing.
17.3.2 Production of Asphalt
Asphalt is a product of the distillation of crude oil.
It is found naturally and can also be produced from petroleum
refining. Almost all asphalt used in the United States is
refined from petroleum. Such asphalt is produced in a
variety of types and grades ranging from hard brittle solids
to almost water-thin liquids. The types of products pro-
duced from refining crude oil are shown in Exhibit 17-2.
About 70 percent of the asphalt produced in the United States
is used for paving.
Asphalt is distilled from crude oil at refineries. The
"crude" is distilled at atmospheric pressure to remove the
lower boiling materials, such as gasoline, kerosene, diesel
oil and gas oil. Nondistillable asphalt is then recovered
from selected topped crude by vacuum distillation; oil and
wax are removed as distillates; and the asphalt is left as
residue. At this stage of production, asphalt cement has
been produced. Some of this product is then blended with
various petroleum solvents to produce cutback asphalt. As-
phalt cement is further processed at an emulsion plant to
produce asphalt emulsion. Asphalt cement used directly for
paving must be heated and mixed with aggregate at a "hot mix"
plant.
17-8
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17.3.2.1 Cutback Asphalt Manufacture
Cutback asphalt is manufactured by blending asphalt
cement and solvents at an asphalt mixing plant. Processes
for manufacturing cutback asphalt can be batch or continu-
ous. In batch processing, a suitable solvent is pumped into
a vessel, then hot. (fluid) asphalt is added and both compo-
nents are mixed by mechanical agitation. When the appropri-
ate formula has been obtained the mixture is poured into
tanks and sealed. Increased demand for cutback asphalt
brought about the advent of continuous processing for manu-
facture. In a continuous process the asphalt and solvent
are pumped through positive displacement meters to a mixing
or blending station and then through a heat exchanger to
storage tank, ship, tank car or tank truck.
17.3.2.2 Asphalt Emulsion Manufacture
Continuous manufacture is the most common process for
manufacturing asphalt emulsions. In this process, the as-
phalt and water are mixed or emulsified in a colloidal mill,
In most types of colloidal mills, the hot asphalt is drawn
out into thin films between a stator and a high speed rotor
The metal surfaces may be smooth or rough and the space be-
tween them is adjustable. In the presence of the aqueous
emulsifying solution, the film breaks into the small drops
found in the finished emulsion. Asphalt emulsions must be
perfectly homogeneous and able to withstand storage and
shipping. Most emulsions must not be subjected to temper-
atures below 0°C because freezing of the aqueous solution
will coagulate the asphalt particles.
17.3.3 Sources and VOC Emission Characteristics of Cutback
Asphalt
Hydrocarbons evaporate from cutback asphalts at the
job site and at the mixing plant. At the job site, hydro-
carbons are emitted from equipment used for applying the
asphaltic product and from road surfaces. At the mixing
plant, hydrocarbons are released during mixing and stock-
piling. The largest source of emissions, however, is the
road surface itself. In Illinois, cutback asphalt is used
in construction and maintenance of secondary roads throughout
the state.
17-9
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It is the petroleum distillate (diluent) in the cu-bar
asphalt that evaporates. The percentage of diluent that
evaporates depends on the cure type.
The diluent in the three types of cutback asphalt that
evaporates represents the following average weight percent
of the asphalt mix:
Slow cure—25 percent
Medium cure—70 percent
Rapid cure—80 percent.
Total emissions from the use of cutback asphalt are
discussed below.
17.3.4 RACT Guidelines
The RACT guidelines specify that the manufacture,
storage and use of cutback asphalt may not be permitted
unless it can be shown that lifelong stockpile storage is
necessary, or the use of application at ambient temperatures
less than 50°F is necessary, or the cutback asphalt is to be
used solely as a penetrating prime coat. The RACT guidelines
advise the use of asphalt emulsion in place of cutback asphali
Emissions from asphalt emulsion are negligible, and it has
been demonstrated in several parts of the country that as-
phalt emulsion is an adequate substitute for cutback asphalt.
To use asphalt emulsion in place of cutback asphalt,
it will be necessary to:
Retrain employees on the use of asphalt emulsions
Make minor modifications to equipment used in
applying cutback asphalt to accommodate asphalt
emulsions, including:
The possible need for new nozzles on the truck
which applies the asphalt, called a distribu-
tor truck
Adjustments to the pumps to apply the emul-
sion
- Cleaning equipment prior to using emulsion
Create emulsion plant capacity to meet the in-
creased demand
17-10
-------
Provide asphalt manufacturing facilities with
venting for steam.
It is reported that asphalt emulsions cannot be applied in
the rain. This is currently true for rapid cure and medium
cure cutback asphalt. The same equipment that is used to
apply cutback asphalt can be used with asphalt emulsions,
with the exception of minor equipment modifications listed
previously.
17.3.5 VOC Emission Control Procedure for Illinois
The State of Illinois has prepared draft legislation
on the use of cutback asphalt as summarized below.
After December 31, 1980, no person shall, cause, allow
or permit the manufacture, mixing, storage, use or applica-
tion of cutback asphalt, except where the use or application
of cutback asphalt commences on or after October 1st of any
year and such use or application is completed by April 30th
of the following year. With prior approval of the Illinois
EPA, lifelong stockpiling of cutback asphalt is permitted.
It is permissible to use cutback asphalt solely as a pene-
trating prime coat.
17.3.6 Statewide Emissions
Total emissions from the use of cutback asphalt in
Illinois for 1977 are estimated at 49,100 tons. Exhibit 17-4,
on the following page, shows a breakdown of emissions for
rapid, medium and slow cure cutback asphalt.
17-11
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Exhibit 17-1
U.K. Environmental I'r otect.ion Aqoncy
ESTIMATED IIYUKOCAUnON EMfSS TOMS KI«)M Tl
US!'1. OK CUTBACK ASPHALT 1M ILLINOIS
Sales3
of
Cutback Estimated Hydrocarbon Emissions
Asphalt In 1977
(000 Tons) (000 Tons)
Rapid Medium Slow Rapid Medium Slow
Cure Cure Cure Cure Cure Cure Total
76 111 52 15.5 29.5 4.1 49.1
1977 sales were assumed to equal 1976.
Source; Mineral Industries Survr-ys, U.S. Dept. of the Interior, Bureau of Mines; "Control of
Volatile Organic Compounds from the Use of Cutback Asphalt," EPA 450/2-77-037
-------
17.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATION'S FOR
RACT REQUIREMENTS
Costs for using asphalt emulsions in place of cutback
asphalts are presented in this section. Each cost item is
discussed and quantified and the total cost is then cal-
culated on a statewide basis.
17.4.1 Costs Associated with Using Asphalt Emulsions in
Place of Cutback Asphalt
Costs for using asphalt emulsions in place of cutback
asphalt were determined through interviews with asphalt trade
associations and asphalt manufacturers and previous studies
of asphalt. Costs will be incurred by both producers and
users of cutback asphalt and asphalt emulsions.
Asphalt producers may incur costs in building additional
emulsion plants for producing asphalt emulsions if current
plant capacity is inadequate to meet increased demand. These
costs would be incurred nationwide. Insufficient data are
available to quantify such costs for Illinois.
Costs to users of cutback asphalt who must convert to
using asphalt emulsions include retraining costs and minor
equipment modification costs. The price per gallon of cut-
back asphalt is approximately equal to -the cost for asphalt
emulsions; therefore, no additional cost would be incurred
for materials. The most significant cost to the user would
be for retraining personnel to apply asphalt emulsions. It
is estimated that these training costs are $300 per person
including the cost of supervision for the training session.
Modification of trucks used in applying asphalt consists
of replacing nozzles at a cost of $5 per nozzle. An average
truck is equipped with 30 nozzles; therefore, the cost per
truck would be $150. Other equipment costs include adjusting
pumps and cleaning equipment before asphalt emulsions can be
applied, and these are considered to be minimal.
Total user costs are assumed to be incurred on a one
time basis. Minor equipment costs are generally not capi-
talized but are expensed in the accounting period in which
they are incurred. The paragraph which follows shows total
costs to the state for converting from the use of cutback
asphalt to asphalt emulsion.
17-12
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17.4.2 Extrapolation to the Statewide Industry
The total costs to Illinois for converting from usincr
cutback asphalt to using asphalt emulsions are estimated at
$229,000, and the cost per ton of hydrocarbon emissions re-
duced is estimated at $4.66. A summary of these costs is
given in Exhibit 17-5, on the following page.
17-13
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Exhibit 17-5
U.S. Environmental Protection Acer.cy
STATEWIDE COSTS FIR RACT
FOR USE OF CUTBACK ASPHALT
Direct Cost Summary
Cutback asphalt used 269
(thousands of tons)
Potential emissions 49,100
reduction from converting
to use of asphalt
emulsions
(tons per year)
Retraining costs3 $183,600
Equipment modification costs 5 45,900
Total one-time costs $229,000
One-time costs per ton of $ 4.66
emissions reduced
Annualized operating cost per ton $ 0
of emission reduced
a' Cost based on retraining six employees per county
k- Cost based on modifying three distributor trucks per county.
Source: Booz, Allen & Haaiilton Inc.
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17.5 ECONOMIC IMPACTS
t
This section presents a discussion of the economic
impacts and the technical feasibility of implementing RACT
for the use of cutback asphalt in Illinois. The technical
feasibility is primarily associated with whether asphalt
emulsions can be substituted for cutback asphalt in paving
applications. The use of asphalt emulsions in place of
cutback asphalt has been demonstrated, to be technically
feasible in several states in the United States. New York
State, where the climate is similar to that of Illinois, has
converted 100 percent from cutback to asphalt emulsions with
little or no difficulty. Economic impacts include the effects
of implementing RACT on cost, price, supply and demand; on
employment; on productivity; and on market structure.
The overall economic impact of implementing RACT for
use of cutback asphalt in Illinois is estimated to be minimal.
Specific economic impacts include impacts on:
Cost—The estimated one-time cost of $229,000
distributed over 102 counties in Illinois is small
compared to the total statewide cost of highway
construction.
Price—The prices of cutback asphalt and asphalt
emulsions are predicted to be unaffected by RACT.
Supply and Demand—The demand for asphalt emulsion
is predicted to more than double by 1980 when RACT
is scheduled for implementation, since the use of
asphalt emulsion will replace the current use of
cutback asphalt. Producers of asphalt emulsions
may have to build new emulsion plants to meet the
expanded demand when RACT is implemented nationally.
It is anticipated that sufficient lead time is
available to assure an adequate supply of asphalt
emulsion to meet the increased demand in Illinois.
Employment—No change in employment is predicted
from implementing RACT, although it will be
necessary to train approximately 600 employees
in Illinois on the use of asphalt emulsions.
Productivity—Worker productivity is not expected
to be affected substantially by implementation of
RACT.
17-14
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Market Structure—No change in market structure
for the use of asphalt emulsions in place of cut
back asphalt is anticipated since the products
are procured in a similar manner.
Exhibit 17-6 presents a summary of the findings of
this report.
17-15
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Current Situation
Number of potentially affected
facilities
Indication of relative impor-
tance of industrial section to
state economy
Current industry technology
trends
1977 VOC actual emissions
Industry preferred method of VOC
control to meet RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost
(statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emissions after control
Cost effectiveness of control
Exhibit 17-6
U.S. Environmental Protectaoij Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR GASOLINE SERVICE
STATIONS IN THE STATE OF ILLINOIS
Discussion
An estimated 19,675 gasoline dispensing facilities
are located in the statp 15.540 are expected to
be potentially affected.
Industry sales are $2.75 billion with a yearly
throughput of 5.435 billion gallons
Number of stations has been declining and throughput
per station has been increasing. By 1980, one-half
of stations in U.S. will be totally self-service
48,900 tons per year from all station operations
Submerged fill and vapor balance
Discussion
$14.7 million
$3.7 million (approximately 0.14 percent of the
value of gasoline sold)
Assuming a "direct cost pass-through"—approximately
$.001 per gallon increase
Assuming full recovery of gasoline—net savings of
124,000 barrels annually
No major impact
No major impact
Compliance requirements may accelerate the industry
trend towards high throughput stations (i.e., mar-
ginal operations may opt to stop operations)
Older stations face higher retrofit costs—potential
concerns are dislocations during installation
30,700 tons per year from all station operations
$203 annualized cost/annual ton of VOC reduction
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
"Control of Volatile Organic Compounds from Use of
Cutback Asphalt," EPA-450/2-77-037, December 1977.
"Air Quality and Energy Conservation Benefits from Using
Emulsions to Replace Asphalt Cutbacks in Certain Paving
Operations," EPA-450/2-78-004, January 1978.
"Mineral Industry Surveys," U.S. Department of the
Interior, Bureau of Mines, June 27, 1977.
"Magic Carpet, The Story of Asphalt," The Asphalt
Institute, 1977.
"Proposed Amendments to Pollution Control Regulations,"
Illinois Environmental Protection Agency.
"Technical Support for RACT Cutback Asphalt," Illinois
Environmental Protection Agency.
"World Use of Asphalt Emulsion," Cyril C. Landise, '
Armak Company, Chicago, Illinois, March 5, 1975.
"Atmospheric Emissions from the Asphalt Industry,"
PB-227 372, National Environmental Research Center,
December 1973.
Asphalt, Its Composition, Properties and Uses, Ralph
M. Traxler, Reinhold Publishing Company, Hew York,
1961.
The Asphalt Handbook, The Asphalt Institute, April 1965.
Introduction to Asphalt, The Asphalt Institute, Novem-
ber 1967.
Telephone interview with Mr. Charles Maday, U.S. EPA,
August 1978.
Telephone interview with Mcr. Charles Owen, The Asphalt
Institute, August 1978.
Telephone interview with Mr. Terry Drane, Emulsified
Asphalt, Inc., August 1978.
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TECHNICAL REPORT DATA
(Please read Inunctions on the rercnc before- coinplctinpl
1 REPORT NO. 2.
EPA-905/5-78-001
4. TITLE ANDSUBTITLE
Economic Impact of Implementing RACT guide-
lines in the State of Illinois
7 AUTHOR(S)
9. PERFORMING ORGANIZATION NAME AND ADDRESS
Booz, Allen & Hamilton Inc.
Foster D. Snell Division (Florham Park, N.J.)
&. Public Management Technology Center
(Bethesda, MD)
12. SPONSORING AGENCY NAME AND ADDRESS
U.S. Environmental Protection Agency
Region V
Air Programs Branch
Chicacro, IL 60604
3. RECIPIENT'S ACCESSION NO.
5. REPORT DATE
6. PERFORMING ORGANIZATION CODE
8. PERFORMING ORGANIZATION REPORT NO
10. PROGRAM ELEMENT NO.
11. CONTRACT/GRANT NO.
68-02-2544, Task 3
13. TYPE OF REPORT AND PERIOD COVERED
Fi na 1 RfapnTt-
14. SPONSORING AGENCY CODE
15. SUPPLEMENTARY NOTES
EPA Project Officer: Rizalino Castanares
16. ABSTRACT
The major objective of the contract effort was to determine the
direct economic impact of implementing RACT standards in Illinois.
The study is to be used primarily to assist EPA and Illinois decisions
on achieving the emission limitations of the RACT standards.
The economic impact was assessed for the following 15 RACT indus-
trial categories: surface coatings (cans, coils, paper, fabrics, auto-
mobiles and light duty trucks, metal furniture, insulation of magnet
wire, large applicances); solvent metal cleaning; bulk gasoline term-
inals; refinery systems; bulk gasoline plants; storage of petroleum
liquids in fixed roof tanks; gasoline dispensing stations—Stage I;
and use of cutback asphalt.
The scope of this project was to determine the costs and direct
impact of control to achieve RACT guideline limitations for these 15
industry categories in Illinois. Direct economic costs and benefits
from the implementation of RACT limitations were identified and quanti-
fied while secondary impacts (social, energy, employment, etc.) are
addressed, they were not a major emphasis in the study.
17. KEY WORDS AND DOCUMENT ANALYSIS
a. DESCRIPTORS
Gasoline marketing
Air pollution
Metal coatings
Solvent substitution
Emission limits
13. DISTRIBUTION STATEMENT
Unlimited
b.lDENTIFIERS/OPEN ENDED TERMS
Air pollution contro
Stationary sources
Illinois
Economic impact
Hydrocarbon emission
Coatings
19. SECURITY CLASS (This Report)
Unclassified
20. SECURITY CLASS (This page!
Unclassified
c. COSATI Field/Group
L
3
21. NO. OF PAGES
22. PRICE
EPA Form 2220-1 (9-73)
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