United States
Environmental Protection
Agency
Air Programs Branch
230 S. Dearborn St.
Chicago, Illinois 60604
EPA 905/5-78-004
January 1979
Air
vvEPA
Economic Impact
of Implementing
RACT Guidelines in
the State of Wisconsin
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TABLE OF CONTENTS
CHAPTER TITLE
1.0 EXECUTIVE SUMMARY
2 . o INTRODUCTION AND OVERALL
STUDY APPROACH
3 o ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR CAN MANUFACTURING PLANTS
IN THE STATE OF WISCONSIN
4.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES TO THE SURFACE
COATING OF COILS IN THE STATE
OF WISCONSIN
5.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
PAPER IN THE STATE OF WISCONSIN
6.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
FABRICS IN THE STATE OF WISCONSIN
7.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE
COATING OF AUTOMOBILES IN THE
STATE OF WISCONSIN
8.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR SURFACE COATING OF METAL
FURNITURE IN THE STATE OF WISCONSIN
9.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE
COATING FOR INSULATION OF MAGNET
WIRES IN THE STATE OF WISCONSIN
10.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE
COATING OF LARGE APPLIANCES
IN THE STATE OF WISCONSIN
11.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR SOLVENT METAL CLEANING
(DECREASING) IN THE STATE OF
WISCONSIN
ill
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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 WISCO
13.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR TANK TRUCK GASOLINE LOAD
TERMINALS IN THE STATE OF WISCONS
14.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR BULK GASOLINE PLANTS IN
THE STATE OF WISCONSIN
15.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR STORAGE OF PETROLEUM
LIQUIDS IN FIXED-ROOF TANKS IN
THE STATE OF WISCONSIN
16.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT STAGE I FOR GASOLINE SERVICE
STATIONS IN THE STATE OF WISCONSI]
17.0 ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR USE OF CUTBACK ASPHALT
IN THE STATE OF WISCONSIN
IV
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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 1-3
1-2 SUMMARY OF IMPACT OF IMPLEMENTING RACT
GUIDELINES IN 15 INDUSTRIAL CATEGORIES
—WISCONSIN 1-7
1-3 ESTIMATED CHANGE IN ENERGY DEMAND
RESULTING FROM IMPLEMENTATION OF RACT
GUIDELINES IN WISCONSIN 1-11
1-4 - SUMMARY EXHIBITS OF THE FIFTEEN RACT
1-17 CATEGORIES 1-19
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 WISCONSIN 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 PRELIMINARY WISCONSIN POINT SOURCE
EMISSION—CAN COATING 3-13
3-11 REVISED WISCONSIN POINT SOURCE
EMISSIONS—CAN COATING 3-13
3-12 RACT GUIDELINES FOR CAN COATING
OPERATIONS 3-14
3-13 PERCENTAGE OF CANS TO BE MANUFACTURED
IN 1982 USING EACH VOC CONTROL ALTERNA-
TIVE 3-14
3-14 EMISSIONS FROM COATING TWO-PIECE ALUMINUM
BEER AND SOFT DRINK CANS PER MILLION CANS 3-22
3-15 EMISSIONS FROM COATING THREE-PIECE CANS
PER MILLION CANS 3-22
3-16 COST OF IMPLEMENTING RACT ALTERNATIVES
FOR REPRESENTATIVE CAN MANUFACTURING
PLANTS ($1,000) 3-24
3-17 COST OF COMPLIANCE TO RACT FOR THE CAN
MANUFACTURING INDUSTRY IN WISCONSIN 3-25
3-18 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR CAN MANUFACTURING
PLANTS IN THE STATE OF WISCONSIN 3-29
4-1 SURFACE COATING OF COILS DATA QUALITY 4-4
4-2 DIAGRAM OF A COIL COATING LINE 4-6
4-3 TYPICAL REVERSE ROLL COATER 4-6
4-4 ESTIMATED TONNAGE OF METAL COATED IN THE
U.S. IN 1977 WITH COIL COATING TECHNIQUES 4-8
4-5 SUMMARY OF EMISSION CONTROL COSTS 4-9
4-6 COIL COATING OPERATIONS IN WISCONSIN 4-10
4-7 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR COIL COATING
FACILITIES IN THE STATE OF WISCONSIN 4-11
5-1 DATA QUALITY—SURFACE COATING OF PAPER 5-5
5-2 1976 INDUSTRY STATISTICS—SURFACE COATING
OF PAPER SIC GROUPS IN WISCONSIN 5-6
vi
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Exhibit Following Page
5-3 HISTORICAL TRENDS IN VALUE OF SHIPMENTS
OF U.S. PLANTS ENGAGED IN PAPER COATING
($ millions) 5-7
5-4 EMISSION DATA FROM TYPICAL PAPER
COATING PLANTS 5-9
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 PROPOSED
PAPER COATING REGULATIONS 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 WISCONSIN 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 WISCONSIN 6-6
6-3 FIRMS EXPECTED TO BE AFFECTED BY THE
FABRIC COATING RACT REGULATIONS IN
WISCONSIN 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
VI1
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Exhibit Following Page
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
6-10 ANNUAL COST OF DIRECT FLAME INCINERATORS
(PRIMARY AND SECONDARY HEAT RECOVERY) 6-18
6-11 SUMMARY OF ASSUMPTIONS USED IN COST
ESTIMATE 6-18
6-12 ESTIMATED COSTS OF COMPLIANCE FOR THREE
PLANTS IDENTIFIED ($ MILLIONS) 6-18
6-13 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR FABRIC COATERS
IN THE STATE OF WISCONSIN 6-21
7-1 SURFACE COATING OF AUTOMOBILES DATA
QUALITY 7-4
7-2 LIST OF FACILITIES POTENTIALLY AFFECTED
BY THE RACT GUIDELINE FOR SURFACE
COATING OF AUTOMOBILES—WISCONSIN 7-5
7-4 WISCONSIN EMISSIONS—SURFACE COATING OF
AUTOMOBILES 7-10
7-5 SELECTION OF THE MOST LIKELY RACT
ALTERNATIVES UNDER SCENARIO I (RACT
COMPLIANCE BY 1982) 7-13
7-6 SELECTION OF THE LIKELY RACT ALTERNATIVES
UNDER SCENARIO II 7-13
7-7 ESTIMATED COST FOR MODEL PLANT TO MEET
AUTOMOBILE RACT REQUIREMENTS 7-18
7-8 STATEWIDE COSTS TO MEET THE RACT GUIDELINES
FOR AUTOMOBILE ASSEMBLY PLANTS 7-18
7-9 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT SCENARIO I FOR AUTOMOBILE
ASSEMBLY PLANTS IN THE STATE OF WISCONSIN 7-23
vin
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Exhibit Following Page
7-10 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO II FOR
THE AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF WISCONSIN 7-23
8-1 SURFACE COATING OF METAL FURNITURE
DATA QUALITY 8-4
8-2 LIST OF MANUFACTURERS WHO SURFACE COAT
METAL FURNITURE IN WISCONSIN 8-5
8-3 COMMON TECHNIQUES USED IN COATING OF
METAL FURNITURE PIECES 8-6
8-4 SUMMARY OF HYDROCARBON EMISSIONS FROM
METAL FURNITURE MANUFACTURING FACILITIES
IN WISCONSIN 8-7
8-5 EMISSION LIMITATIONS FOR RACT IN SURFACE
COATING OF METAL FURNITURE 8-7
8-6 RACT CONTROL OPTIONS FOR THE METAL
FURNITURE INDUSTRY 8-7
8-7 ESTIMATED COST OF CONTROL FOR MODEL
EXISTING ELECTROSTATIC SPRAY COATING LINES 8-9
8-8 ESTIMATED COST OF CONTROL OPTIONS FOR
MODEL EXISTING DIP COATING LINES 8-9
8-9 STATEWIDE COSTS FOR PROCESS MODIFICATIONS
OF EXISTING METAL FURNITURE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION
CONTROL 8-9
10-1 SURFACE COATING OF LARGE APPLIANCES
DATA QUALITY 10-5
10-2 LIST OF MANUFACTURERS, POTENTIALLY
AFFECTED BY RACT GUIDELINES, WHO SURFACE
COAT LARGE APPLIANCES IN WISCONSIN 10-6
10-3 INDUSTRY STATISTICS—SURFACE COATING OF
LARGE APPLIANCES IN THE STATE OF WISCONSIN 10-6
10-4 COMPARISON OF LARGE APPLIANCE STATISTICS
WITH STATE OF WISCONSIN ECONOMIC DATA 10-6
10-5 HISTORICAL U.S. SALES FIGURES—SELECTED
MAJOR HOUSEHOLD APPLIANCES FOR 1968-
1977 10-7
ix
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Exhibit , Following Page
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 WISCONSIN 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 WISCONSIN 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 WISCONSIN 10-12
10-16 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR SURFACE COATING
OF LARGE APPLIANCES IN THE STATE OF
WISCONSIN 10-16
11-1 DATA QUALITY 11-13
11-2 ESTIMATED NUMBER OF VAPOR DEGREASERS
IN WISCONSIN 11-14
11-3 ESTIMATED NUMBERS OF COLD CLEANERS IN
WISCONSIN 11-14
x
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Exhibit Following Page
11-4
11-5
11-6
11-7
11-8
11-9
11-10
11-11
11-12
11-13
11-14
11-15
11-16
11-17
11-18
11-19
ESTIMATE OF NONEXEMPT SOLVENT METAL
CLEANERS IN WISCONSIN
SOLVENTS CONVENTIONALLY USED IN SOLVENT
METAL DECREASING
CONTROL SYSTEMS FOR COLD CLEANING
EPA PROPOSED CONTROL SYSTEMS FOR OPEN
TOP VAPOR DEGREASERS
EPA PROPOSED CONTROL SYSTEMS FOR
CONVEYORIZED DEGREASERS
AVERAGE UNIT EMISSION RATES AND EXPECTED
EMISSION REDUCTIONS
ESTIMATED CURRENT AND REDUCED EMISSIONS
FROM SOLVENT METAL CLEANING IN WISCONSIN
(Short Tons)
CONTROL COSTS FOR AVERAGE-SIZED COLD
CLEANER WITH 5.25 FT.2 AREA
CONTROL COSTS FOR AVERAGE-SIZED OPEN TOP
VAPOR AND CONVEYORIZED CLEANERS
ESTIMATED CONTROL COSTS FOR COLD CLEANERS
FOR THE STATE OF WISCONSIN
ESTIMATED CONTROL COSTS FOR OPEN TOP
VAPOR DEGREASERS FOR THE STATE OF
WISCONSIN
ESTIMATED CONTROL COSTS FOR CONVEYORIZED
DEGREASERS FOR THE STATE OF WISCONSIN
ESTIMATED NUMBER OF COLD CLEANERS NEEDING
CONTROLS IN THE STATE OF WISCONSIN
ESTIMATED NUMBER OF OPEN TOP VAPOR
DEGREASERS NEEDING CONTROL IN THE STATE
OF WISCONSIN
ESTIMATED NUMBER OF CONVEYORIZED DEGREASERS
NEEDING CONTROLS IN THE STATE OF WISCONSIN
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
11-14
11-15
11-19
11-19
11-19
11-21
11-21
11-22
11-22
11-22
11-22
11-22
11-22
11-22
11-22
IMPLEMENTING RACT FOR SOLVENT METAL
DECREASING IN THE STATE OF WISCONSIN 11-25
XI
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Exhibit Following Page
12-1 DATA QUALITY 12-5
12-2 PETROLEUM REFINERIES IN WISCONSIN 12-6
12-3 INDUSTRY STATISTICS FOR REFINERIES IN
WISCONSIN 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 WISCONSIN 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 VACUUM PRODUCING SYSTEMS,
WASTEWATER SEPARATORS AND PROCESS UNIT
TURNAROUNDS 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 WISCONSIN 12-18
13-1 DATA QUALITY 13-5
13-2 INDUSTRY STATISTICS FOR TANK TRUCK GASO-
LINE LOADING TERMINALS IN WISCONSIN 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
13-5 VOC EMISSIONS FROM TANK TRUCK GASOLINE
LOADING TERMINALS IN WISCONSIN 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
xii
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Exhibit Following Page
13-8
13-9
13-10
14-1
14-2
14-3
14-4
14-5
14-6
14-7
14-8
14-9
14-10
14-11
14-12
15-1
15-2
DESCRIPTION AND COST OF MODEL TANK TRUCK
GASOLINE LOADING TERMINALS EQUIPPED WITH
VAPOR CONTROL SYSTEMS
STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
FOR TANK TRUCK GASOLINE LOADING TERMINALS
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR TANK TRUCK
GASOLINE LOADING TERMINALS IN WISCONSIN
DATA QUALITY
INDUSTRY STATISTICS FOR BULK GASOLINE
PLANTS IN WISCONSIN
GASOLINE DISTRIBUTION NETWORK
DISTRIBUTION OF BULK GASOLINE
PLANTS BY AMOUNT OF THROUGHPUT
VOC EMISSIONS FROM BULK GASOLINE PLANTS
IN WISCONSIN
VOC EMISSION CONTROL TECHNOLOGY FOR BULK
GASOLINE PLANTS
ALTERNATIVE CONTROL METHODS FOR VAPOR
CONTROL AT BULK GASOLINE PLANTS
COSTS OF ALTERNATIVE VAPOR CONTROL
SYSTEMS
DESCRIPTION AND COST OF MODEL BULK PLANTS
EQUIPPED WITH VAPOR CONTROL SYSTEMS
STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
FOR BULK GASOLINE PLANTS
STATEWIDE COSTS OF VAPOR CONTROL SYSTEM
BY SIZE OF BULK GASOLINE PLANT
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR BULK GASOLINE PLANTS
IN WISCONSIN
DATA QUALITY
TYPICAL FIXED ROOF TANK
13-13
13-14
13-18
14-5
14-6
14-6
14-7
14-10
14-10
14-11
14-13
14-14
14-14
14-15
14-21
15-4
15-5
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Exhibit Following Page
15-3 SCHEMATIC OF TYPICAL FIXED ROOF TANK
WITH INTERNAL FLOATING COVER 15-6
15-4 TYPICAL FLOTATION DEVICES AND PERIMETER
SEALS FOR INTERNAL FLOATING COVERS, AND
COVERED FLOATING ROOF 15-7
15-5 INSTALLED COST OF SINGLE SEAL FLOATING
ROOF TANKS (PRICES APPROXIMATE) 15-9
15-6 VOC EMISSIONS CONTROL COSTS FOR STORAGE
OF PETROLEUM LIQUIDS IN FIXED-ROOF TANKS
IN WISCONSIN 15-9
15-7 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR STORAGE OF
PETROLEUM LIQUIDS IN THE STATE OF
WISCONSIN 15-10
16-1 DATA QUALITY 16-4
16-2 INDUSTRY STATISTICS FOR GASOLINE
SERVICE STATIONS IN WISCONSIN 16-5
16-3 GASOLINE DISTRIBUTION NETWORK 16-6
16-4 CLASSIFICATION OF SERVICE STATIONS 16-6
16-5 VOC EMISSIONS FROM GASOLINE SERVICE
STATIONS 16-9
16-6 VOC EMISSION CONTROL TECHNOLOGY FOR
GASOLINE SERVICE STATIONS 16-10
16-7 STAGE I VAPOR CONTROL SYSTEM - VAPOR
BALANCING WITH SEPARATE LIQUID-VAPOR
RISERS 16-10
16-8 STAGE I VAPOR CONTROL SYSTEM - VAPOR
BALANCING WITH CONCENTRIC LIQUID-VAPOR
RISERS 16-10
16-9 STAGE I VAPOR CONTROL COSTS FOR A
TYPICAL GASOLINE DISPENSING FACILITY 16-13
16-10 STATEWIDE COSTS FOR STAGE I VAPOR
CONTROL OF GASOLINE SERVICE STATIONS 16-14
16-11 STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
BY SIZE OF GASOLINE DISPENSING FACILITY
IN WISCONSIN 16-14
xiv
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Exhibit Following Page
16-12 SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT FOR GASOLINE
SERVICE STATIONS IN THE STATE OF WISCONSIN 16-18
17-1 DATA QUALITY 17-3
17-2 PETROLEUM ASPHALT FLOW CHART 17-5
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 WISCONSIN 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 WISCONSIN 17-15
LIST OF FIGURES
Figure Following Page
11-1 SPRAY CLEANING EQUIPMENT 11-16
11-2 OPEN TOP DEGREASER 11-17
11-3 CROSS-ROD CONVEYORIZED DEGREASER 11-18
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 in the State of Wisconsin. 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
fifteen 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
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. For existing
stationary sources, these limitations reflect the application
of Reasonably Available Control Technology (RACT). The
limitations are established to guide the states in revising
their State Implementation Plans (SIP) to achieve the National
Ambient Air Quality Standards for oxidants. The EPA requires
that the oxidant plan submissions for major urban areas should
contain regulations to reflect the application of RACT to
stationary sources for which the EPA has published guidelines.
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 pri-
marily 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 guideline
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 Wisconsin, the economic impact was assessed
for the following 15 RACT industrial cate-
gories:
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 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 1-1, on the following
page. (In addition an alternate scenario for the
surface coating of automobiles is presented in
this report).
The timing requirement for implementation of
controls to meet RACT emission limitations
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
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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Category
EXHIBIT 1-1 (1)
U.S. Environmental Protection Agency
LISTING OF EMISSION LIMITATIONS THAT REPRESENT
THE PRESUMPTIVE NORM TO BE ACHIEVED THPOLG1!
APPLICATION OF RACT FOR FIFTEEN INDUSTRY CATEOO^IL
RACT Guideline Emission Limitations3
Surface Coatina 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
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 chillers;
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.
-------
EXHIBIT 1-1 (2)
U.S. Environmental Protection Agency
Category
RACT Guidelines Emission Limitations3
Petroleum Refinery Sources
Vacuum producing systems
Wastewater separators
. Process unit turnaround
Bulk Gasoline Terminals
Bulk Gasoline Plants
Storage of Petroleum Liquids in Fixed
Roof Tanks
Service Stations (Stage I)
Use of Cutback Asphalt
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 depressurizat
venting to vapor recovery, flare or firebo
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
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 necessar
or it is to be used solely as a penetratin
crime coat
Note:An alternative scenario to the recommended PACT 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
Source: Regulatory Guidance for Control of Volatile Organic Compound Emissions from 15
Categories of Stationary Sources, U.S. Environmental Protection Agency, EPA-SU
78-001, April 1578.
-------
The following volatile organic compounds were
exempted:
Methane
Ethane
Trichlorotrifluorethane (Freon 113)
1,1,1-trichloroethane (methyl chloroform).1
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 avail-
able 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 from the state
emission inventory. Therefore, the follow-
ing 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.
iThe exemption status of methyl chloroform under these
guidelines may be subject to change.
1-4
-------
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, re-
fineries, service stations, fixed roof tanks,
solvent metal cleaning and use of cutback asphalt)—
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 gener-
alized 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 re-
viewed .
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.
1-5
-------
In the determination of the economic impact for each
industrial category studied, the estimated compliance cost
is subject to inherent variations in the procedures for esti-
mating:
Engineering cost estimates
The number of sources affected.
Engineering cost estimates, when performed for an indi-
vidual 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 more than 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 esti-
mated from available data sources.
Therefore, 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 uncer-
tainty involved in the selection and demonstrated capabilities
of the control alternatives. Furthermore, 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
qualitative 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 per-
cent.
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 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
-------
1.2 STATEWIDE AGGREGATE ECONOMIC IMPACT
FOR THE FIFTEEN RACT GUIDELINES
-------
1.2 STATEWIDE AGGREGATE ECONOMIC IMPACT
FOR THE FIFTEEN RACT GUIDELINES
The implementation of RACT emission limitations for fifteen
industrial categories in Wisconsin involves an estimated $211
million capital cost and $37 million annualized cost per
year. The net VOC emission reduction is estimated to be
82,300 tons annually. 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 guidelines for fifteen industrial categories.1
Approximately 24,000 facilities are potentially
affected by the fifteen RACT guidelines in
Wisconsin.
Ninety-five percent of the potentially
affected facilities are represented by the
solvent metal cleaning (15,000 facilities)
and service station (7,900 facilities) in-
dustrial categories.
Less than 1 percent (43 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
119,000 tons.
Three gas marketing categories (tank truck
loading terminals, bulk gas plants and service
stations) represented 32 percent of the total
VOC emissions.
Solvent metal cleaning represented 16 percent
of the total VOC emissions (from the fifteen
RACT categories studied).
Fixed roof tanks represented 4 percent of the
total VOC emissions.
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
-------
EXHIBIT 1-2
0.5. Environmental Protection Agency
sumARt OF IMPACT or IMPLEMENTING KACT
OTIDELINES IN IS INDUSTRIAL CATEGORIES—WISCONSIN
Industry Category
Surface coating
of can*
Surface coating
of coils
Surface coating
of paper
Surface coating
of fabric*
Surface coating
of autosobiles
Surface coating of
natal furniture
Surface coating for
insulation of
nagnet wirec
Surface coating of
large appliances
Solvent metal
cleaning
Refinery vacuusi
MiMber of
Facilities
Potentially
Affected
a
3
10
3
3
9
—
7
15,000
1
1977 VOC
Emissions
(tons/yr. )
4,200
SO)
6,400
1,070
11.200
350
~
4OO
19.2OO
5,600
Seisaiona
Estimated VOC
Emissions
After
Implementing
RACT
(tona/yr. )
1.100
116
1,200
210
1.5OO
60
-
120
14,700
240
Hat VOC
Emission
Reductions
(tons/yr. )
3,100
387
5.2OO
860
9,700
290
~
2*0
4,5OO
5,360
Capital
Coat*
(J millions)
2.6
0.7
7.1
2.8
ISO
0.30
™
2.7
2.8
0.17
Annualizad
Coat as
Percent of
Annuallzed Value of
Coat (credit) Shipments0
(J millions) (percent)
0.10 0.1
0.18 HA
1.9 0.4
0.6 1.5
25 0.7
0 07 0.50
• "
0.68 0.11
0 26 0 015
0.03 0.02
Annualizad
Cost Per
Unit
(cost per unit)
0
HA
Incressa of 0.3-
0.5 percent
Increase of about
1.5 percent
$40/vehicle
Varies with area
coated
-
$0.19/houeenold
appliance
Negligible
-
Coat
Effect! veneaa
Annualizad
Coat (credit)
Par Ton of VOC
Reduction
($ per tona/yr.)
277
490
375
700
2,570
255
-
2,232
SB
6
syataaa, waatevater
separators and
turnarounds
Tank truck gasoline 41
loading terminals
Bulk gasoline plants 1,262
plants
Storage of petroleum 11
liquids in fized
roof tanks
Service atationa
(Stage I)
Cutback asphalt
TOTAL
7,900
24.258
5.050
11,850
4,500
500
3,300
450
21,700 13,400
27,2OO 0
119.200 36.900
4,550
8,550
4,050
8,300
27.2OO
92,30O
12.6
19.2
2.14
1.2
5 27
0.07
0.13
1.5 $O.OOS/gal.d
<$0.01/gal.
KA
0.15
61
615
16
-------
Use of cutback asphalt represented 23 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
82,300 tons annually. The approximate percent of the
total VOC emissions reduced by implementing RACT
by industrial category group is:
Solvent metal cleaning category—5 percent
of VOC emission reduction
Gas marketing categories—26 percent of VOC
emission reduction
Fixed roof tanks—5 percent of VOC emission
reduction
Surface coating categories—24 percent of
VOC emission reduction
Refinery vacuum systems—7 percent of VOC
emission reduction
Use of cutback asphalt—33 percent of VOC
emission reduction. (However, this assumes
complete discontinued use of solvent-based
material.)
The capital cost for the fifteen industrial categories
to achieve the RACT guidelines is estimated to be
$211 million. Approximately 71 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 $150 million. (An alternative scenario
to the recommended RACT limitations for
automobiles is also developed. This alternative
scenario would represent an estimated capital
cost of $35 million.)
The four industrial categories dealing with
petroleum (bulk gasoline plants, bulk gasoline
terminals, service stations and fixed roof tanks)
account for approximately $41 million (or 19
percent of the total) of the estimated capital
cost.
1-8
-------
The annualized cost of the fifteen RACT industrial
categories to achieve the RACT guidelines is
estimated to be $37 million. The control of
automobile assembly plants has an estimated
$25 million annualized cost (the alternative
scenario for auto assembly has an estimated
annualized cost of $5 million). In terms of
cost indicators, the annualized compliance cost
per value of shipments will have the largest effect
on the following industrial categories:
Surface coating of fabrics—The annualized
compliance costs represent approximately
1.5 percent of the 1977 value of ship-
ments for the firms affected.
Bulk gasoline plants—The annualized costs
represent approximately 1.5 percent of the
1977 value of shipments for the firms
affected.
Surface coating of automobiles—The
annualized compliance costs represent
approximately 0.7 percent of the 1977 value
of shipments for the firms affected.
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 top coating. Manufacturers
could not convert facilities on a nation-
wide basis to waterborne top coat systems.
- 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)
1-9
-------
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 large appliances
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.
Conversion of automobile assembly plants
to waterborne topcoat systems would require
extensive modification of current
facilities; with potential increased produc-
tivity 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 some
industrial sectors requiring major capital and
annualized cost increases for compliance. RACT
requirements may have an impact on the market struc-
ture and trends in the following RACT industrial
categories:
Bulk gasoline plants
Service stations
Surface coating of paper.
1-10
-------
The implementation of the RACT guidelines for the
fifteen industrial categories is estimated to
represent a net energy savings of 59,000 equivalent
barrels of oil annually; or 0.06 percent of the
statewide energy demand for all manufacturing. Assuming
a value of oil at $13 per barrel, this is an equivalent
energy savings of $770,000 annually. Exhibit 1-3, on
the following page, presents the estimated change
in energy demand for implementation of the RACT
guidelines in Wisconsin.
RACT compliance requirements 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 160,000 equivalent
barrels of oil annualy.
RACT compliance requirements for refinery
systems represent a net energy savings of
approximately 45,500 equivalent barrels of
oil annually.
RACT compliance requirements for the four
industrial categories dealing with petroleum
marketing (service stations, fixed roof tanks
bulk gasoline terminals, bulk gasoline plants)
represent a net energy savings of approximately
173,000 barrels of oil annually. However, the
control efficiency has not been fully demon-
strated and these estimates are likely to
overstate the achievable energy savings for
bulk gasoline plants and service stations.
In 1977, the statewide value of shipments of the fifteen
industrial categories potentially affected by RACT was $7.4
billion, which represents approximately 22 percent of Wisconsin's
total value of shipment of manufactured goods. The esti-
mated annualized cost of implementing the RACT guidelines
($37 million) represents 0.5 percent of the value of shipments
for the fifteen RACT industrial categories affected. The
annualized cost represents 0.1 percent of the statewide total
value of shipment of all manufactured goods.
1-11
-------
EXHIBIT 1-3
U.S. Environmental Protection Agency
ESTIMATED CHANGE IN ENERGY DEMAND RESULTING
FROM IMPLEMENTATION OF RACT GUIDELINES IN WISCONSIN
Industry Category
Surface coating of cans
Surface coating of coils
Surface coating of paper
Surface coating of fabrics
Surface coating of automobiles
Surface coating of metal
furniture
Surface coating for insula-
tion of magnet wire
Surface coating of large
appliances
Solvent metal cleaning
Refinery systems
Tank truck gasoline loading
terminals
Bulk gasoline plants
Storage of petroleum liquids in
fixed roof tanks
Service stations (STAGE I)
Use of cutback asphalt
TOTAL
Energy Demand Change
Increase (Decrease)
(Equivalent barrels of oi1)
4,000
2,300
30,000
5,000
124,000
None
None
(5,600)
negligible
(45,500)
(31,000)
(58,000)
(27,400)
(56,600)
None
(58,800)
Energy Demand Change
Cost/(Savings)3
($ million)
0.05
0.03
0.40
0.07
1.61
None
None
(0.07)
negligible
(0.6)
(0.41)
(0.75)
(0.36)
(0.74)
None
(0.77)
a. Based on the assumption that the cost of oil is $13 per barrel.
Source; Booz, Allen & Hamilton Inc.
-------
1.3 ECONOMIC IMPLICATIONS OF EACH RACT GUIDELINE
-------
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. Fol-
lowing this section is a series of summary exhibits which high-
light the study findings for each industrial category.
1.3.1 Surface Coating of Cans
Currently there are eight major can coaters in the state
of Wisconsin. In addition, approximately seven other satellite
plants fabricate metal food cans from precoated stock.
The industry-preferred method of control to meet the
PACT 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 large facilities out of state for
cost-effectiveness, in addition to meeting RACT requirements.
Emission controls are expected to cost $2.6 million in capital
and $100,000 in annualized costs (approximately 0.10 percent of
statewide industry value of shipments) to meet RACT guidelines.
1.3.2 Surface Coating of Coils
Of the three identified coil coaters in the state of
Wisconsin, two will require RACT guidelines. One facility
has already installed a thermal oxidation system which is
assumed to meet the RACT guidelines. Both companies subject
to the RACT guidelines expect to install thermal incineration
with primary heat recovery if suitable substitute water-based
or high solids enamels are not available within the regulation
time frame requirements. Assuming thermal incineration controls,
the capital costs are estimated at $700,000 and the annual costs
at $175,000.
1.3.3 Surface Coating of Paper
This study covered 10 plants identified from the state
emission inventory. Excluded from this study are facilities
engaged in publishing, which 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.
Further definition of the paper coating category needs to be
established prior to regulatory enforcement.
1-12
-------
The individual retrofit situations and installation costs
for add-on controls are highly variable. Based on these varia-
tions, the estimated capital cost to the industry is between
$6.4 million and $7.8 million, with an annualized cost of $1.6
million to $2.3 million (approximately 0.4 percent of the
statewide industry 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 70 percent heat recovery, the annual energy
requirements are expected to increase by approximately
30,000 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 on a nationwide basis.
1.3.4 Surface Coating of Fabrics
There are two firms in Wisconsin 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 $2.8 million in capital and approximately $0.60
million (approximately 1.5 percent of statewide industry value
of shipments) in annualized cost to meet RACT limitations.
The companies affected estimated their capital costs at
closer to $3.5 million to $4 million.
No significant productivity, employment or market
structure dislocations should be associated with the im-
plementation of the RACT guideline.
Incinerator equipment manufacturers have stated that
there may be significant problems in meeting the anticipated
demand for high heat recovery incinerators.
Assuming a 70 percent heat recovery, about 5,000
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 three automobile
assembly plants in Wisconsin. Wisconsin is the seventh largest
state in terms of automobile production in the U.S. and the
value of shipments of automobiles represents approximately
10 percent of the statewide value of manufacturing shipments.
The EPA recommended RACT guidelines would require conversion
to waterborne paints. However, the EPA is currently consider-
ing some modifications of the RACT requirements for automobile
assembly plants. Therefore/ there are two scenarios of RACT
guidelines studied:
1-13
-------
Scenario I—Current RACTlimitations implemented by
19JS2. 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 electrodposition for prime coat
Waterborne enamels for topcoat
High solids enamels for final repair.
The implementation of these technologies would require
extensive modification to all three facilities in Wisconsin.
The capital required would be approximately $150 million or
300 percent of the estimated current annual capital appropriations.
The estimated annualized compliance cost is $25 million and
would represent an increased energy demand of approximately 124,000
barrels of oil annually. If this increased cost were passed
on directly, it would represent an increase in price of $40
per vehicle manufactured. These major modifications would
require approximately three to four years for completion and,
although possibly achievable in Wisconsin, 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. 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. At General Motor's facilities
(which use lacquer paints) the conversion to other technology
developments is still likely to require major plant modifications.
The capital requirements for Scenario II are estimated to be
$35 million or 70 percent of the current annual capital
appropriations in the state. The estimated annualized
compliance cost is $5 million. If this increased cost were
passed on directly, it would represent an increase in price
of $8 per vehicle manufactured.
1-14
-------
1.3.6 Surface Coating of Metal Furniture
There are nine firms in Wisconsin 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 $300,000 in capital and
approximately $75,000 (0.5 percent of the industry's 1977
value of shipments) 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 if suitable waterborne coatings material
capable of withstanding a corrosive environment were not developed
in time.
1.3.7 Surface Coating for Insulation of Magnet Wire
This study has not identified any facilities currently
coating magnet wire for insulation in the state of Wisconsin.
Therefore, in Wisconsin the implementation of RACT guidelines
for magnet wire coating is not expected to have any economic
impact or to reduce emissions.
1.3.8 Surface Coating of Large Appliances
There are seven companies identified as major coaters of
large appliances in Wisconsin. The industry statewide is
estimated to invest approximately $2.7 million in capital
and incur additional annualized costs of $680,000 (approx-
imately 0.11 percent of industry statewide value of ship-
ments) to meet the emission limitations.
Assuming a "direct cost pass-through," the cost increase
for household appliances relates to a price increase of approximate!;
$0.19 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 severely affected,
none of the companies contacted indicated that they might cease
production. No major productivity, employment or market struc-
ture dislocations appear to be associated with implementation
of the RACT guidelines.
1-15
-------
The high solids (greater than 62 percent by volume)
topcoat application technique preferred by the industry has
not been 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 15,000 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 $2.8 million and an annua-
lized cost of $260,000 (approximately 0.015 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 nationwide 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 was one refinery facility in the state of Wisconsin
potentially affected by the proposed RACT guidelines. The
RACT requirements represent a capital investment of approxi-
mately $168,000 and an annualized cost of approximately
$34,000.
No significant productivity, employment or market
structure dislocations should be associated with the imple-
mentation of the RACT guideline.
1-16
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1.3.11 Tank Truck Gasoline Loading Terminals
There are 41 facilities identified in the state of
Wisconsin as tank truck gasoline loading terminals. Emission
control of these facilities is expected to require a capital
investment of $12.6 million. Product recovery of gasoline
will accrue 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. The annualized cost for implementation of RACT for
bulk gasoline loading terminals is estimated to be $1.2
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 accrue to a bulk terminal or refinery.
The estimated capital cost and annualized cost to meet
compliance requirements for the 1,262 facilities in the state
of Wisconsin represent $19.2 million and $5.27 million (approx-
imately 1.5 percent of industry statewide value of shipments),
respectively. Industrywide, the price of gasoline (assuming a
"direct cost pass-through") would be increased $0.005 per gal-
lon, 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 con-
centrating the market structure. In urban areas, the bulk
gasoline plant markets have been declining because of competition
from retailers and tank truck terminals, and are expected to
continue to decline regardless of the RACT guidelines.
1-17
-------
The implementation of the RACT alternatives of submerged
filling and vapor balancing could produce an energy saving
equivalent to 58,000 barrels of oil per year assuming a
control efficiency as defined by the RACT guidelines.
This assumed control efficiency has not been fully demon-
strated.
1.3.13 Storage of Petroleum Liquids in Fixed Roof Tanks
There are approximately 11 fixed roof tanks, each of which
is greater than 40,000 gallons and used for storing petroleum
liquids.
These tanks are owned by major oil companies, large
petrochemical firms and bulk gasoline tank terminal com-
panies. The capital cost to equip these fixed roof tanks
with a single floating roof is estimated to be $2.14 million.
The estimated annualized cost is $66,000, which would repre-
sent a price increase (assuming "direct cost pass-through")
of less than $0.01 per gallon of throughput.
No significant productivity, employment or market
structure dislocations will be associated with the imple-
mentation of the RACT guidelines.
Implementation of the RACT guideline is estimated to
represent a net energy savings of 27,400 equivalent barrels
of oil annually (assuming 90 percent control efficiency.)
1.3.14 Service Stations
Of the estimated 7,900 gasoline dispensing facilities
potentially affected in Wisconsin, 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 estimated
at $7.49 million and annualized cost at $1.79 million (approxi-
mately 0.15 percent of the statewide value of gasoline sold)
for implementing submerged fill and vapor balancing.
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.
1-18
-------
It is estimated that implementing RACT guidelines for
service stations in Wisconsin will result in a net energy
savings equivalent to 56,000 barrels of oil per year,
assuming 98 percent recovery of gasoline. 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 183,000 tons of cutback
asphalt were utilized in the state of Wisconsin. 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 1-17, on the
following pages.
1-19
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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 WISCONSIN
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 control to meet
RACT guidelines
Discussion
There are eight major can manufacturing
facilities and seven other satellite
plants manufacturing fabricated metal
food cans from precoated stock
1977 Value of Shipments was $350 million.
Industry is closely related to state's
brewing and dairy industries
Beer and beverage containers rapidly
changing to two-piece can construction
4,100-4,200 tons per year
Low solvent coatings (waterborne)
Low solvent coatings (waterborne)
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
$2.6 million from uncontrolled state;
approximately 13 to 25 percent of
current annual capital appropriations
for the industry; $1.5 million above
1977 in-place level
$100,000 (approximately 0.1 percent
of current direct annual operating
costs)
No price increase
Increase of 4,000 equivalent barrels of oil
annually for operation of facilities
that have to utilize incinerators (1,000
equivalent barrels above 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 for end sealing
compound will probably not be available
Low solvent coating technology
for end sealing compound
1,200 tons per year (29 percent
of 1977 emission level)
$277 annualized cost/annual ton of VOC
reduction from theoretical level attributed
.to implementation of 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 WISCONSIN
Current Situation
Number of potentially affected facilities
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
There are three coil coating facilities
potentially affected by the coil coating
RACT guideline in Wisconsin. One firm
currently meets RACT emission limitations
Due to the pressures of energy availability
as well as environmental protection, most
firms have installed or intend to install
regenerative-type incinerators
503 tons per year, of which 447 tons is
subject to RACT compliance
Regenerative thermal incineration; high
solids or waterborne enamels
Regenerative thermal incineration
Affected Areas in Meeting RACT
Capital Investment (statewide)
Annual!zed Cost (statewide)
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$700,000 incremental capital required by one
firm if they were to install controls on a
new processing line
$175,000
Assuming 70 percent heat recovery, energy
requirements are expected to increase
by approximately 2,300 equivalent barrels
of oil annually
No major impact
No major impact
The captive coil coating operation not
meeting the RACT limitation may opt to
purchase coated material in lieu of in-
vesting significant capital requirements
Implementation of thermal incineration
may be delayed due to delivery installation
problems
Low solvent coating technology is currently
inadequate to meet product requirements
116 tons per year (23 percent of 1977 VOC
emission level)
$490 annualized cost/annual ton of COC
reduction
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 1-6
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR PAPER COATERS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected facilities
Indication of relative importance of
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
Ten plants have been identified from the
emission inventory. However, if this
category is interpreted to include all
types of paper coating, including pub-
lishing, far more firms would be affected
The 1977 value, of shipments of the ten
plants identified is estimated to be
approximately $420 million. These plants
are estimated to employ approximately
5,600 people
Gravure coating replacing older systems
Approximately 6,400 tons per year were
identified from the emission inventory.
Actual emissions are expected to be higher
Though low solvent coating use is increas-
ing 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 $6.4 million to $7.8
million depending on retrofit situations.
This will be more than 100 percent of
normal capital expenditures for the
affected paper coaters
$1.6 million to $2.3 million annually.
This represents approximately 0.3 to
0.5 percent of the 1977 annual sales for
the affected paper coaters
Assuming a "direct cost pass-through"~
0.3 percent to 0.5 percent
Assuming 70 percent heat recovery, energy
requirements are expected to increase by
approximately 30,000 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 more than
$1 million for a carbon adsorber
RACT guideline needs clear definition for
rule making
Equipment deliveries and installation of
incineration systems prior to 1982 are
expected to present problems
Retrofit situations and installation costs
are highly variable
Type and cost of control depend on particu-
lar solvent systems used and reduction in
air flow
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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 WISCONSIN
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
Three firms were identified as being affected
by the proposed regulation
Total value of shipments by the three plants
identified is about ?40 million. These plants
employ about 500 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 1,070
tons/year
Direct fired incineration for short range,
low solvent coatings are a long-range goal
Direct fired 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
VOC emissions after RACT control
Cost effectiveness of RACT control
Discussion
Study team estimate is about $2.5 million to
$3.0 million. Companies affected estimate
costs to be as much as $3.5 million to $4
million
Approximately $0.6 million, which represents
about 1.5 percent of these 1977 value of
shipments
Assuming a "direct pass-through of costs,"
prices of coated fabrics will increase by about
1.5 percent
Assuming 70 percent heat recovery, about 5,000
equivalent barrels of additional fuel oil would
be required per year
No major impact
No 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
210 tons/year (20 percent of 1977 VOC emissions)
$700 annualized cost/annual ton of VOC reduction
Note; Cost data are based on emission information supplied by the Wisconsin Department
of Natural Resources.
Source; Booz, Allen & 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 WISCONSIN
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
Number of potentially affected facilities
Indication of realtive 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
Discussion
Two companies operating three facilities
1977 value of shipments was approximately
$3.5 billion which represents approximately
10 percent of the states manufacturing
industry. Of all states, Wisconsin ranks
seventh in automobile production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
11,240 tons per year
Cathodic electrodeposition for prime
coat, manufacturers with enamel topcoat—
high solids enamel, manufacturers with
lacquer topcoat--unkown
Cathodic electrodeposition for prime coat
Waterborae enamels for topcoat
High solids enamels for final repair
Affected Areas in Meeting RACT
Scenario I
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity and employment
Market structure
Discussion
$150 million (approximately 300 percent
of current annual capital expenditures
for the industry in the state)
$25 million (approximately 0.7 percent of
the industry's 1977 statewide value of
shipments)
Assuming a "direct cost pass-through"
approximately $40 per vehicle manufactured
Increase of 124,000 equivalent barrels
of oil annually primarily for operation
of waterborne topcoating systems
Conversion to waterborne systems would
require total rework of existing processing
lines. Major modifications would probably
increase efficiency and line speed of
older units and possibly shutting 4own
one facility.
Accelerated technology conversion to
electrodeposition primer coat.
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EXHIBIT 1-8 (2)
U.S. Environmental Protection Agency
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
RACT timing requirements (1982)
Problem areas
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
Nationwide conversion of all automobile
assembly plants to topcoating waterborne
systems cannot be achieved by 1982.
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 alter-
native. Final repair RACT limitations
area based on high solids enamel tech-
nology which is likely to require major
modifications for manufacturers using
lacquer systems
1,500 tons per year (13 percent of 1977
emission level)
$2,570 annualized cost/annual ton of
VOC reduction
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 1-8 (3)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO II FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF WISCONSIN
SCENARIO II
(RACT Requirements Are Modified
To Meet Specific Technologies)
Current Situation
Number of potentially affected facilities
Indication of realtive 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
Market structure
RACT timing requirements
Problem area
VOC emission after RACT control
Cost effectiveness of RACT controls
Discussion
Two companies operating three facilities
1977 value of shipments was approximately
$3.5 billion which represents approximately
10 percent of the states manufacturing
industry. Of all states, Wisconsin ranks
seventh in automobile production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
11,240 tons per year
Cathodic electrodeposition for prime
coat, manufacturers with enamel topcoat-
high sales enamel, manufacturers with
lacquer topcoat—unknown
Cathodic electrodeposition for prime coat
High solids enamels, urethane enamels or
powder coating for topcoat
High solids enamel for final repair
Discussion
$35 million (approximately 66 percent
of current annual capital appropriations
for the industry in the state)
$5 million (approximately 0.1 percent of
the industry's 1977 statewide value of
shipments)
Assuming a "direct cost pass-through"
approximately $8 per vehicle manufactured
Dependent on technology applied
No major effect
No major effect—however, General Motors
is likely to have higher conversion costs
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,
depending on technology developments
Limitations for topcoat are dependent on
technology development
1,500-2,700 tons per year (13 percent to
24 percent of 1977 emission levels depen-
dent on limitations)
$530-5610 annualized cost/annual ton of
VOC reduction
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-9
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING OF
METAL FURNITURE IN WISCONSIN
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 control to meet
RACT guidelines
Discussion
There are nine metal furniture manufacturers
and coaters
1977 value of shipments was estimated at $150
million and represents 6.3 percent of the es-
timated U.S. value of shipments
353 tons per year
Low solvent coatings
Low solvent coatings
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirement (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Dicsussion
$0.33 million
$75,000 which represents 0.05 percent of the
industry's 1977 value of shipments
Increase a few cents to over $I/unit depending
on the surface area coated (assuming a full cost
pass through)
No major impact
No major impact
No major impact
No major impact
Conversion to waterborne coating may pose a
problem for one company if suitable waterborne
coating material capable of withstanding cor-
rosive environment were not developed in time
Development of suitable waterborne coating
material for corrosive environment
59 tons/year (17 percent of 1977 emission level)
$1,125 capital cost/annual ton VOC reduction
$255 annualized cost/ton 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 LARGE
APPLIANCES IN THE STATE OF WISCONSIN
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 seven major large appliance manu-
facturers and coaters
1977 statewide value of shipments was estimated
at 5600 million and represents 4 percent of the
estimated $15 billion U.S. value of shipments
of the major appliance industry
400 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
$2.7 million
$625,000 which represents 0.11 percent of the
industry's 1977 statewide value of shipments
Assuming a "direct cost pass-through"—increase
of $0.19/unit for household appliances (based on
a price of $170 per household appliance)
Reduced natural gas requirements in the curing
operation (equivalent to 5,600 barrels of oil
per year)
No major impact
No major impact
No major impact
No problem meeting equipment deliveries and
installation are anticipated
Commercial application of high solids
(greater than 62% by volume) has not been
proven
120 tons/year (30 percent of 1977 emission
level)
$2,232 annualized cost/ton VOC reduction
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 1-11
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SOLVENT METAL DECREASING
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected facilities
Indication of relative importance of in-
dustrial 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
Discussion
About 15,000 plants
Value of shipments of firms in SIC groups
affected is in the range of $16.0 billion,
about one-half of the state's 1977 value
of shipments.
Where technically feasible, firms are sub-
stituting exempt solvents.
19.,200 tons/year of which 7,900 tons are
subject to RACT
Substitution. Otherwise lowest cost option
as specified by EPA will be used.
Equipment modifications as specified by the
RACT guidelines
Affected Areas in Meeting RACT
Capital investment Cstatewidel
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
$2.8 million
$0.26 million, (approximately 0.015 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
Lass than 600 equivalent barrels of oil
per year increase
5-10 percent decrease for manually operated
degreasers. Will not affect 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 modifi-
cations
No significant problem areas seen. Most
firms will be able to absorb cost.
14,700 tons/year (77 percent of 1977 VOC
emission level—however, this does not in-
clude emission controls for exempt solvents)
$58 annual!zed cost per ton of emissions
reduced.
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 REFINERY VACUUM PRODUCING SYSTEMS, WASTEWATER
SEPARATORS AND PROCESS UNIT TURNAROUNDS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected
facilities
Indication of relative importance
tance of industrial section to
state economy
1977 VOC actual emissions
Industry preferred method of
VOC control to meet RACT
guidelines
Assumed method of VOC control
to meet RACT guidelines
Discussion
1977 industry sales were $200 million. The
estimated annual crude oil throughput was
16 million barrels
5,600 tons per year
Vapor recovery of emissions by piping
emissions to refinery fuel gas system or
flare and covering wastewater separators
Vapor recovery by piping emissions from
vacuum producing systems to refinery fuel gas
system. Cover wastewater separator, pipe
emissions from process units to flare
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost
(statewide)
Price
Energy
Productivity
Employment
Market structure
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$168,000
$34,000 (approximately 0.02 percent of
the current industry value of shipments)
No major impact
Assuming full recovery of emissions
—net savings of approximately 1,000
equivalent barrels annually
No major impact
No major impact
No major impact
240 tons per year (4 percent of 1977
emission level)
$6 annualized cost/annual ton of 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 TANK TRUCK GASOLINE
LOADING TERMINALS IN WISCONSIN
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
41
1977 industry sales were $940 million, with
annual throughput of 2.211 billion gallons.
New terminals are being designed with vapor
recovery equipment
5,050 tons per year
Submerge fill or bottom fill and vapor recovery
Affected Areas in Meeting RACT
Capital investment (statewide
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$12.6 million
$1.2 million (approximately 0.13 percent of
industry value of shipment)
No change in price assuming a "direct cost
passthrough"
Assuming 90 percent recovery of gasoline
--net savings of 31,000 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
500 tons per year (10 percent of 1977
emission level)
$61 annualized cost/annual ton of VOC
reduction from terminals assuming gasoline
credit from vapors returned from bulk gasoline
plants and gasoline service stations
Source: Boo2, Allen & Hamilton Inc.
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EXHIBIT 1-14
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR BULK GASOLINE PLANTS IN WISCONSIN
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
Affected Areas in Meeting RACT
Capital investment (statewide)
Annual!zed cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
1,262
1977 industry sales were $343 million, with
annual throughput of 0.81 billion gallons.
The primary market is rural accounts
Only small percent of industry has new/modern-
ized plants
11,850 tons per year
Top submerge or bottom fill and vapor bal-
ancing (cost analysis reflects top submerged
fill, not bottom fill)
Discussion
$19.2 million
$5.27 million (approximately 1.5 percent of
industry value of shipment)
Assuming a "direct cost passthrough," $.0065
per gallon increase industrywide
Assuming full recovery of gasoline—net savings
of 58,000 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 declining
industry. Many small bulk gas plants today are
marginal operations; further cost increases
could result in plant closings
Potential severe economic impact for small bulk
plant operations. Regulation could cause
further market imbalances. Control efficiency
of cost effective alternative has not been
effectively demonstrated
3,272 tons per year (27 percent of
1977 emission level)
$615 annualized cost/annual ton of
VOC reduction
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 STORAGE OF PETROLEUM LIQUIDS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected
storage tanks
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
Actual 1977 VOC emissions
Preferred method of VOC control to
meet RACT guidelines
Discussion
11
The annual throughput was an estimated
707.7 million gallons
Internal floating roof tanks utilizing
a double seal have been proven to be
more cost effective
4,452 tons per year
Single seal and internal floating roof
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$2.14 million
$66,000
Assuming a "direct cost passthrough"
—less than 0.1 cents per gallon of
throughput
Assuming 90 percent reduction of current
VOC level, the net energy savings repre-
sent an estimated savings of 27,377
equivalent barrels of oil annually
No major impact
No major impact
No major impact
Potential availability of equipment to
implement RACT standard
445 tons per year (10 percent of 1977
emission level)
$16 annualized cost/annual ton of VOC
reduction
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 1-16
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR GASOLINE SERVICE STATIONS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
Actual 1977 VOC emissions
Preferred method of VOC control to
meet RACT guidelines
Discussion
Approximately 7,900 gasoline dispensing
facilities
Industry sales are SI.193 billion with a yearly
throughput of 2.354 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
21,680 tons per year from all station operation
Submerged fill and vapor balance
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
S7.49 million
$1.79 million (approximately 0.15 percent of
the value of gasoline sold)
Assuming a "direct cost pass-through"—
less than $0.001 per gallon increase
Assuming full recovery of gasoline—net
savings of 56,600 barrels annually
No major impact
No major impact
Compliance requirements may accelerate the
industry trend towards high throughput stations
(i.e., marginal operations may opt to cease
operations')
Older stations face higher retrofit costs—
potential concerns are dislocations during
installations
13,387 tons per year from all station operation
(61 percent of 1977 emission level)
$215 annualized cost/annual ton of VOC reduction
Source; Booz, Allen & Hamilton Inc.
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Exhibit 1-17 (1)
U.S. Environmental Protection Agency
SUMMARY OF-DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTATING RACT FOR USE OF CUTBACK ASPHALT
IN THE STATE OF WISCONSIN
Current Situation
Use potentially affected
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
In 1977, estimated use of cutback asphalt
was 183,000 tonsa
1977 sales of cutback asphalt were
estimated to be $16.8 million
Nationally, use of cutback asphalt has
been declining
27,200 tons annually
Replace with asphalt emulsions
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
Discussion
$0.2 million
No change in paving costs is expected
No change in pavings costs is expected
No major impact to the user*5
No major impact
No major impact
No major impact
Winter paving
Short range supply of asphalt emulsions
a.
b.
All of this use may not be affected by the regulations because
of likely exemptions.
If all cutback asphalt were replaced with emulsions, up to 271,456
equivalent barrels of oil savings might accrue to the manufacturer,
not user. This is based on the difference in total energy asso-
ciated with manufacturing, processing and laying of cutback asphalt
(50,200 Btu per gallon) and emulsions (2,830 Btu per gallon). One
ton of cutback asphalt or emulsion contains 256 gallons and one
barrel of oil contains 6.05 million Btus.
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Exhibit 1-17(2)
U.S. Environmental Protection Agency
Current Situation
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
Net VOC emissions reduction is estimated
to be 27,200 tons annuallyc (100 percent
of 1977 emission level)
$0 annualized cost/annual ton of VOC
reduction level)
c. Based on replacing all cutback asphalt with emulsions.
Source; Booz, Allen & Hamilton Inc.
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2.0 INTRODUCTION AND OVERALL STUDY APPROACH
-------
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 I, 1979 for approval by July, 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 Booz,
Allen and Hamilton Inc. (Booz, Allen) to determine the economic
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 defend EPA and state decisions on achieving the
emission limitations of the RACT standardsi
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 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 Wisconsin, 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(1)
U.S. Environmental Protection Agency
LISTING OF EMISSION LIMITATIONS THAT REPRESENT
THE PRESUMPTIVE NORM TO BE ACHIEVED THROUGH
APPLICATION OF RACT FOR FIFTEEN INDUSTRY CATEGC
RACT Guideline Emission Limitations3
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.S
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 chilli
or carbon adsorption system; drying tunre:
or rotating basket; safety switches; cove:
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.
-------
EXHIBIT 2-1(2)
U.S. Environmental Protection Agency
Category
RACT Guidelines Emission Limitations3
Wastewater 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 depressurizatioi
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
Source:
Regulatory Guidance for Control of Volatile Organic Compound Emissions from 15
Categoriesjjf Stationary Sources, U.S. Environmental Protection Agency. EPA-405/2-
78
April 1978.
-------
The timing requirement for implementation 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 most of 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 guide-
lines stated above are included in this
analysis).
The following volatile organic compounds were
exempted:
Methane
Ethane
Trichlorotrifluorethane (Preon 113)
1,1,1-trichloroethane (methyl chloroform).1
The cost of compliance was determined from
the current level of control (i.e., if an
affected facility currently had an incin-
erator in place, the cost of compliance and
resulting VOC emission reduction are not
included in this analysis).
The 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 Wisconsin. The methodology applied
to determine the economic impact for each of the fifteen RACT
industrial categories in Wisconsin is described in further
detail in the first section of each chapter dealing with the
specific RACT category.
There are five parts to this section to describe the
approach for determining estimates of:
Industry statistics
VOC emissions
Process descriptions
Cost of controlling VOC emissions
Comparison of direct cost with selected direct
economic indicators.
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 economics (financial) status
Industry concentration
Business patterns (small vs. large; downstream integration)
Age distribution of facilities
Future trends and developments.
2-7
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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.
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 Wisconsin emission inventory 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 Wisconsin emission inventory.
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.
2-8
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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.
2.4.2 VOC Emissions
An approach that made maximum utilization of the
existing Wisconsin emission inventory 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 inventory provided relevant data
that could be utilized for economic evaluation,
i.e., air flow rate, type of process, the
input and emission factors.
The data base was not compiled in a baseline
consistent with the RACT industrial categories.
A project task was established to compile data from
the Wisconsin emission inventory for relevant
industrial categories These RACT industrial
categories included:
Cans
Coils
Fabrics
- Paper
Automobiles
Metal furniture
Large appliances
Magnet wire
Fixed roof tanks.
2-9
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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
Solvent metal cleaning
Service stations
Cutback asphalt.
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.
2-10
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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 costs 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.
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:
- Depreciation—10 percent (assuming straight-
line over a ten-year life)
Interest—8 percent
Maintenance—4 percent
Taxes and insurance—3 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).
2-11
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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.
2-12
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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. «
This analysis was based on the average
cost change (including those facilities
that may have little or no economic
impact associated with meeting the pro-
posed standards) divided by the average
unit price of goods manufactured.
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 stand-
ards.
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).
2-13
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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
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.
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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.
2-15
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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.
2-16
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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.
2-17
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3.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
CAN MANUFACTURING PLANTS
IN THE STATE OF WISCONSIN
-------
3.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
CAN MANUFACTURING PLANTS
IN THE STATE OF WISCONSIN
This chapter presents a detailed economic analysis of
implementing RACT controls for can manufacturing plants in the
State of Wisconsin. 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
-------
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 Wisconsin.
The quality of the estimates is described in detail in
the latter part of this section.
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 Wisconsin
point source emission inventory and a review of the 1976 County
Business Patterns and supplemented by 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 Insti-
tute.
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 ) 7.76
Indiana Withheld
TOTAL 1,126.5 24.97
3-2
-------
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
For 1977, the U.S. Industrial Outlook,
1977 indicates that the increase in
production is 3 percent, with a 10
percent increase in value of shipments.
This factor was used to estimate 1977
can production and the value of ship-
ments .
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 Wisconsin point source emission
inventory and from interviews.
3.1.2 VOC Emissions
The data for determining the current level of emissions
from the eight large plants was provided by the Wisconsin point
source emission inventory. These emission estimates were for
1976; no adjustment for 1977 was made. Emissions from the seven
smaller satellite assembly plants were estimated through the
development of a representative can assembly plant.
3.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for can manufac-
turing plants are described in Control of Volatile Organic Emis-
sions from Existing Stationary Sources, EPA-450/2-77-008. The
data provide the alternatives available for controlling VOC
emissions from can manufacturing plants. Several studies of VOC
emission control 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 manufacturing plants in Wisconsin. 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 Can Manufacturers Institute to the state EPA programs.
3-3
-------
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
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 knowledgeable individuals in the
can manufacturing industry.)
Aggregating costs to the total industry in
Wisconsin.
Costs were determined from analysis of the previously
mentioned studies:
Control of Volatile Organic Emissions from
Existing Stationary Sources, EPA-450/2-77-008
3-4
-------
Air Pollution Control Engineering and Cost
Study of General Surface Coating Industry,
Second Interim Report, Springborn Labora-
tories
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 Wisconsin were developed based on the plant operational data
included in the Wisconsin point source 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 Wisconsin.
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 Wisconsin. A rating
scheme is presented in this section to indicate the quality of
the data available for 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 interviews, analysis
of previous studies and best engineering judgment. 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
-------
EXHIBIT 3-1
U.S. Environmental Protection Agency
DATA QUALITY
Study Outputs
Industry statistics
A B
Hard Extrapolated
Data Data
X
Estimated
Data
Emissions
X
Cost of emissions
control
X
Statewide costs of
emissions
X
Overall quality of
data
X
Source; Booz, Allen & Hamilton Inc.
-------
3.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business trends
for can manufacturing plants in Wisconsin are presented in this
section. Data in this section form the basis for assessing
the impact of implementing RACT for control of VOC emissions
from can manufacturing plants in the state.
3.2.1 Size of the Industry
There are eight major can manufacturing facilties in
Wisconsin. In addition, approximately seven other satellite
plants fabricate metal food cans from precoated stock.
Exhibit 3-2, on the following page, presents a summary of can
manufacturing facilities potentially affected in the state. The
industry shipped 4.1 billion cans with a value of approximately
$350 million in 1977. The estimated number of employees in 1977
was 3,000. Can industry capital investments in Wisconsin are
estimated to have been $10 million to $20 million in 1977
(based on an extrapolation of 1972 data.)
3.2.2 Comparison of the Industry to the State Economy
The Wisconsin can manufacturing industry is closely tied
to the brewing and dairy industries in the state. The industry
employs 0.2 percent of the state labor force, excluding govern-
ment employees. Although the production of cans in the state
has increased from approximately 4.5 percent of the national
total in 1967 to approximately 5.5 percent in 1977, the state
appears to be a net importer of cans, primarily from the Chicago
area.
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. Of the eight
major can manufacturing facilities in Wisconsin, four are
independent and four are captive. At least two of the satellite
can assembly plants are operated by American Can Company,
utilizing stock coated by American Can at their Milwaukee plant.
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:
3-6
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EXHIBIT 3-2 (1)
U.S. Environmental Protection Agency
LIST OF METAL CAN MANUFACTURING
FACILITIES POTENTIALLY AFFECTED
BY RACT IN WISCONSIN
Name of Firm
American Can Co.
Location
Milwaukee
Carnation Can Co.
Carnation Can Co.
Continental Can Co.
Continental Can Co.
Continental Can Co.
Miller Brewing Co.
Jos. Schlitz Brewing Co.
Menomonee Falls
Waupun
Glendale
LaCrosse
Racine
Milwaukee
Oak Creek
Product
2- and 3-piece beer and
food cans
2-piece steel beer cans
3-piece beer and food
cans
2-piece aluminum
2-piece aluminum cans
3-piece assembly
3-piece assembly
2-piece aluminum beer
cans
2-piece aluminum beer
cans and soda cans
Notes
More than 80 percent of output
is beer cans
Extensive sheet coating and
decorating to supply satellite
can assembly plants
Two 2-piece can lines
Extensive sheet coating and
decorating to supply satellite
can assembly plants
Two 2-piece can lines
General purpose cans
Captive use only
Interior spray coat
One can line
Beer cans used captively
Soda cans sold commercially
Two can lines
-------
EXHIBIT 3-2 (2)
U.S. Environmental Protection Agency
Name of Firm Location
Carnation Company Oconomowoc
Fall River Canning Co. Cambria
Green Giant Ripon
Heekin Can Augusta
Libby, MeNeill and Libby Baraboo
National Can Company Green Bay
Oconomowoc Canning Co. DeForest
Product
3-piece condensed milk
3-piece food cans
3-piece food cans
3-piece pet food cans
3-piece food cans
3-piece food cans
3-piece food cans
Notes
a & c
a & b & c
Two can lines
a & b & c
All cans are sold commercially
Two can lines
a & c
Stock is coated at the Libby
plant at Chicago
All cans are sold commercially
a & c
Notes:
a.
b.
c.
All captive
Plant operated by American Can Company using stock coated at their Milwaukee facility.
Production using pre-coated stock and can ends that are pre-compounded. The only
coating operation is post striping.
Source; Booz, Allen £, Hamilton, Inc.; Wisconsin State Emission Inventory, 1976; Thomas Register, 1978
-------
The need to protect different products with
varying 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 different
shapes, styles 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.
Type of Can Percent of Total Production
Beer and soft drink 54
Fruit and vegetable 18
Food cans in the category that
includes soup cans 8
Other 2Q_
TOTAL 100
In Wisconsin, the can industry is focused on meeting the
needs of the brewing, dairy and vegetable canning industries in
the state. The industry does not offer a significant line of
general purpose cans to other states. The requirements for
these cans in Wisconsin are probably met from plants in the
Chicago area. Of the 4.1 billion cans produced in Wisconsin in
1977, approximately 2.5 billion (61 percent) are estimated to
have been beer and soft drink cans, and 1.6 billion (39 percent)
were food cans.
1.0 billion food cans were produced in satellite
assembly plants.
0.6 billion food cans were produced in major
can plants with coating facilities.
1.6 billion beer and soft drink cans were produced
on two-piece can making machinery.
0.9 billion beer and soft drink cans were produced
using three-piece construction.
3-7
-------
The can industry in Wisconsin, as well as nationally, has
experienced rapid technological changes since 1970 caused by
the introduction of a new can making technology—the two-piece
can. The changes in can manufacturing technology have resulted
in the closing of many can plants producing the traditional
three-piece product and in other plants replacing their 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
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3.3 THE TECHNICAL SITUATION IN 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 Wisconsin.
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
COATING
TRAV
SHEET (PLATE)
FEEDER
•ASE COATER
WICKET OVEN
SHEET (PLATE)
STACKER
Source: U.S. Environmental Protection Agency
-------
•LANKfT
CYLINDER
SHEET (PLATt)
fEEDER
INK
AFf LICATORS
EXHIBIT 3-4
U.S. Environmental Protection Agency
SHEET PRINTING OPERATION
LITHOGRAPH
COATER
OVER VARNISH
COATEM
WICKET OVEN
SHEET (PI ATE)
STACKER
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
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EXHIBIT 3-5
•J.S. Environmental Protection Agency
CAN END, AND THREE-PIECE BEER AND BEVERAGE
CAN FABRICATING OPERATION
SHEET (PLATII STACK
SCROLL
STRIP SHEARER
COMPOUND LINER
TAIFORMER
ENDSEAMER
FORMED
SOLDERED
OR CEMENTED
,4"
100 Y MAKER
SIDE SEAMi
• SPRAY
OVEN
INSIDE
•OOY
SPRAY
NECKER AND HANGER
fAlllTlllOlOAO
lEAICTEHEH
-------
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. In Wisconsin, at least
two, of the estimated seven, two-piece can lines
produce steel cans.
3-11
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EXHIBIT 3-6
U.S. Environmental Protection Agency
TWO-PIECE ALUMINUM CAN FABRICATING AND COATING
OPERATION
CANS
con
CUPPER
WALL
IRONER
OVEN
INTERIOR IODV SPRAY
ANO EXTERIOR END SPRAY
AND/OR ROLL COATER
WASHER
LEAK
TESTER
OVEN
•ASE COAT TRAY
EXTERIOR IASE COATER
I
CANS
PRINTER ANO OVER-VARNISH
COATER
COLOR 4
COLOR!
COLOR!
COLOR 1
VARNISH TRAY
NECKERANO
FLANGER
OVEN
Source: U.S. Environmental Protection Agency
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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 manu-
facture 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 approximately 4,500 tons.
Emissions from 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 1,600 0.67 1,072
soft drink
End sealing compound 1,000 0.22 220
for Schlitz and
Miller lines
3-piece beer and 900 1.79 1,611
soft drink
3-piece food and 1,600 0.99 1,584
other
TOTAL 4,487
3-12
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EXHIBIT 3-7 (1)
U.S. Environmental Protection Agency
EMISSIONS FOR TYPICAL COATING
OPERATION USED IN THE MANUFACTURE
OF TWO-PIECE CANS
Coating Properties
Operation,
Organic Systems
Print and varnish
Size and print
White base coat and
print
Interior body spray
End coating Al
End coating steel
Low Solvent Systems
Waterborne
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*3
Organic
Density
(Ib./gal.)
8.0
8.0
11.0
7.9
8.0
8.0
8.5
8.5
11.7
8.55
8.5
8.5
Solids
(wt. »)
45
40
62.5
26
45
45
35
30
62
20
35
35
Solvent
(wt. *)
100
100
100
100
100
100
20
20
20
20
20
20
(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
Water
(gal. /gal.
coating)
0
0
0
0
0
0
0.53
0.57
0.43
0.66
0.53
0.53
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
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
Yield
(1000 can/
gal.)
12
20
9
6a
200
40
11
17
8
5a
200
40
8.0
95
100
0.40
0.40
0.40
25
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EXHIBIT 3-7 (2)
U.S. Environmental Protaction Agency
Operation
Production
Organic Systems
Print and varnish
Size and print
White base coat
and print
Interior body
spray
End coating Al
End coating steel
Low Solvent Systems
Waterborne
Print and varnish
Size and print
White base coat
and print
Interior body
spray
End coating Al
End coating steel
UV Cured High solids
Print and varnishb 650
(cans/min.)
650
650
650
650
650
650
h 650
650
650
650
650
1 650
(Million
cana/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
Coating Consumed
253.5
(gal./hr.)
3.25
1.95
4.33
6.50
0.20
0.98
3.55
2.29
4.88
7.80
0.20
0.98
1.56
(1000 gal./yr.
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
voc
(Ib./nr.)
14.3
9.4
17.8
38.0
0.9
4.3
3.9
2.7
4.3
10.6
0.2
1.1
(tons/yr.)
46.5
30.6
57.9
123.5
2.9
14.0
12.7
8.8
14.0
34.5
0.7
3.6
(Ib. /million cans)
364
241
457
974
23
110
100
69
110
272
6
28
0.6
2.0
15
a. Assuming 75 percent beer cans, all given a single coat, and 25 percent soft drink cans, given a double coating
b. Booz, Allen & Hamilton Inc. estimate based on data supplied by CMI, individual can manufacturers and the EPA
document 450/2-77-008
Source: Booz, Allen S, 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. Environmental Protection Agency
COATING AND PRINTING OPERATIONS USED IN
THE MANUFACTURE OF THREE-PIECE CANS
(Sheet Coating Operation)
Operation
Coating Properties
Conventional Organics Systems
Sizing and print
Inside basecoat
Outside white and print
Outside sheet printing and
varnish
Density
(Ib./gal.)
8.0
8.05
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
Water
(gal/gal
coating)
0
0
0
0
VOC
(lb. solvent/
gal. less
water)
4.80
4.83
4.13
4.40
VOC
(lb. solvent/
gal. including
water)
4.80
4.83
4.13
4.40
Dry Coating Thickness
5
20
40
10
basebox)
0.086
0.346
0.692
0.172
Low Solvent Systems
Sizing (waterborne)
Inside basecoat
High solids
Waterborne
Outside white
High solids
Waterborne
Outside sheet print and
varnish (waterborne)
8.5
30
20
1.19
0.57
8.0
8.8
12.0
11.7
8.5
80
40
80
62
35
100
20
100
20
20
1.60
1.06
2.40
0.89
1.11
0
0.51
0
0.43
0.53
2.76
1.60
2.15
2.40
1.55
2.36
1.19
60
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 Organics Systems
Sizing and print
Inside basecoat
Outside white and print
Outside sheet printing and varnish
Low Solvent Systems
Sizing (waterborne)
Inside basecoat
High solids
Waterborne
Outside white
High solids
Waterborne
Outside sheet print and varnish
(waterborne)
Production
Coating Consumption
(base box
hr.)
150
150
150
150
150
150
150
150
150
150
(1000 base boxesa
year)
240
240
240
240
240
240
240
240
240
240
(gallon
basebox)
.027
.107
.100
.048
.034
.054
.098
.072
.095
.057
(gallon
hour)
4.1
16.1
15.0
7.2
5.1
8.1
14.7
10.8
14.3
8.6
(1000 gal.
year)
6.6
25.7
24.0
11.5
8.1
13.0
23.5
17.3
22.9
13.8
VOC
(Ib.
hour)
19.7
77.8
62.0
31.7
6.1
13.0
15.4
25.9
12.6
9.5
(tons
year)
15.8
62.2
49.6
4.9
10.4
12.3
20.7
10.1
7.6
( Ibs
1000 base boxes)
130
517
413
211
41
87
103
172
641
63
a. Assuming 1,600 hours per year of operation.
Source: Bo°2' Allen & Hamilton Inc. estimates based on data supplied by CMI and individual can companies.
-------
EXHIBIT 3-9 (1)
U.S. Environmental Protection Agency
EMISSIONS OF TYPICAL COATING
OPERATIONS USED IN THREE-PIECE
CAN ASSEMBLY
Coating Properties
Operation Density
(Ib./gal.)
Organic Systems
Interior body spray
(beer)
Inside stripe
(beer & bev.)
(food)
Outside stripe
(beer)
End sealing compound
(beer & bev.)
(food)
Low Solvent Systems (water
Interior body spray
(beer)
Inside stripe
(beer & bev.)
(food)
Outside stirpe
(beer)
End sealing compound
(beer & bev.)a
(food)a
7.9
8.0
8.0
8.0
7.1
7.1
borne)
8.55
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
-------
EXHIBIT 3-9 (2)
U.S. Environmental Protection Agency
Operation
Production^
(cans/min.)
Oiganic Systems
Interior body 400
spray (beer)
Inside stripe
(beer & bev.) 400
(food) 400
Outside stripe 400
(beer)
End sealing
compound
(beer & bev.) 400
(food) 400
Low Solvent Systems
(Waterborne)
Interior body 400
spray (beer)
Inside stripe
(beer & bev.) 400
(food) 400
Outside stripe 400
(beer)
End sealing
compound
(beer s, bev.)a 400
(food)3 400
(Million
cans/yr.)
120
120
72
120
120
72
Coating Consumed
120
120
72
120
120
72
(gal.Ar.)
6.00
0.30
0.30
0.48
2.40
2.40
4.B
0.30
0.30
0.53
2.40
2.40
(1000 gal./yr.)
30.0
1.5
0.9
2.4
12.0
7.2
24.0
1.5
0.9
2.6
12.0
7.2
voc
Ub./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.)
87.8
5.3
3.2
8.3
26.0
15.6
16.3
0.8
0.5
1.5
1.0
0.6
(Ib. /mi 11 ion cans
1,463
88
88
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 beer and beverage cans.
Source: Booz, Allen & Hamilton Inc. estimates based on data supplied by CMI and individual can companies
-------
The preliminary Wisconsin point source emission inventory
showed a total emissions of 4,278 tons in 1977. This number
was subsequently revised to 4,577 tons.
Exhibit 3-10, on the following page, presents
the preliminary estimate of total emissions
from the eight major can manufacturing facili-
ties.
Exhibit 3-11, following Exhibit 3-10, shows
the revised estimate of VOC from the eight
major can manufacturing facilities.
Booz, Allen believes that there may be two discrepancies
in the revised emission inventory:
The two two-piece can manufacturing lines
at American Can's Milwaukee facility appear
to be omitted.
Emissions from the end compounding line
at the Miller plant appear too high, per-
haps by an order of magnitude.
An analysis of the interview notes and the emissions data
provided indicated that less than 20 percent of the emissions
were being controlled in 1977, resulting in an emission reduction
of less than 10 percent. Booz, Allen believes that actual 1977
emissions were 4,100 to 4,200 tons.
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
PRELIMINARY WISCONSIN POINT SOURCE EMISSION—CAN COATING
File
Number
410026
410001
320020
140020
680375
Company Name, Location
American Can Co.
6000 N. Teutonia Ave.
Milwaukee, WI 53209
Continental Can Co.
4300 N. Port Washington Rd.
Glendale, WI 53212
Continental Can Co., Inc.
Plant #437
1501 Saint James St.
Lacrosse, WI 54601
Carnation Co. - Can Div.
S. Madison St.
Waupun, WI 53963
Carnation Can Co.
N. 90 W. 14600 Commerce Dr.
Menomonee Falls, WI 53051
Process Description
3-piece side seam spray
3-piece can side seam spray
3-piece side seam spray
3-piece can side seam spray
Litho coating 2-piece can
Litho coating 2-piece can
Oven exhaust
Compound LNG
Varnish
Lacquer spray
Can assembly
Coating
Interior vinyl coating
Inside stripe spray
Coating line
Inside spray line
Misc. solvent
Can liner machine
Current Controls^
Type Efficiency
0 0
0
0
0
99
99
0
0
Current VOC Emission
TPY TPD (Ib./hr.)
74.10 0.30 24.70
163.13
37.30
191.82
78.95C
78.95°
1235.41
306.00
0.65
0.15
0.77
0.23C
0.23C
4.09
1.22
54.36
12.43
63.94
19.35C
19.35C
340.90
102.00
728.00 2.91 242.67
830.00 4.15 345.83
35.60 0.18 14.83
178.00 0.55 45.78
37.25 0.87 108.30
0.68 0.00 0.49
19.19 0.08 6.40
104.16 0.42 52.08
43.37 0.17 21.69
4.07 0.02 2.04
VOC Emission
Factorb
(Ib./gal.)
6.70
6.30
6.70
6.30
6.30
6.30
4.60
4.50
5.33
5.81
3.04
RACT
Standards
(Ib./gal.)
5.50
5.50
5.50
5.50
2.80
2.80
2.80
3.70
2.80
4.20
2.80
6.30
4.00
6.00
0.67d
5.56
7.11
0.56d
2.80
2.80
2.80
2.80
4.20
2.80
2.80
-------
EXHIBIT 3-10(2)
U.S. Environmental Protection Agency
File
Number
520075
410089
410357
Company Mama, Location
Continental Can Co.
Plant #445
1901 Chickory Rd.
Racine, HI 53403
Miller Brewing Co.
8500 W. Tower Ave.
Milwaukee, HI 53224
Jos. Schlitz Brewing Co.
7620 S. 10th Street
Oak Creek, HI 53154
Total
Total above RACT standard
Process Description
Lacquer spray
Assembly section
Beer can mfg. line
East can line
Hest can line
Current Controls^
Type
0
0
1
Efficiency
0
0
90
Current VOC
TPY
0.26
16.33
0.03
TPD
0.01
0.06
0.00
Emission
(Ib./hr.)
1.25
7.85
0.02
VOC Emission
Factor*3
(Ib./gal.)
7.04
6.53
0.77
RACT
Standards
(Ib./gal.)
2.80
2.80
5.50
85 57.54 0.18 14.66
85 57.54 0.18 14.66
4277.68 17.42 1515.28
4139.31 16.96 1477.80
0.84
0.84
5.50
5.50
Note:
a. 0 indicates no control or percent efficiency is not listed; 1 indicates incineration is the type of
control.
b. Assumptions listed on exhibits entitled "Supplementary Data For Hisconsin Point Source Emission" are
used to calculate VOC emission factor in Ibs./gal.
c. The reported VOC emissions are not in the same range as those without control, even though controls are reported.
It is possible that the reported VOC are before incineration.
d. The reported VOC emission factor is below RACT standards even though no controls are reported.
Source: Boos, Allen & Hamilton Inc. analysis of Wisconsin Point Source Emission Inventory.
-------
EXHIBIT 3-11(1)
U.S. Environmental Protection Agency
REVISED WISCONSIN POINT SOURCE EMISSIONS—CAN COATING
File
Number
41001
410026
410089
410357
520075
680375
320020
1300
140020
Continental Can Co.
American Can Co.
Miller Brewing Co.
Jos. Schlitz
Brewing Co.
Continental Can Co.
Continental Can Co.
Continental Can Co.
Oconomowoc Canning Co.
Carnation Company
Process Description
P-30 Varnish
P-32 Lacquer spray
P-33 Can assembly
P-32
P-33
P-36
P-37
P-39
P-31 Bottom coater
P-32 Inside coat sprayer
P-33 End linine compound
Exterior basecoat
Exterior overvarnish
Interior spray coat
End sealing compound
P-31 Lacquer sprays
P-30 Assembly section
P-30 Misc. solvents
P-31 Litho line
P-32 Coating line
P-33 Can forming line
P-34 Inside spray
P-35 Can liner
P-36 Litho press
Coating
3-piece side seam
End sealing compound
2 S 3 piece can interior
3-piece side seam
563-803
163-812
P259
End sealing compound
9179
91014
1105
1108
Current
Emission
728.0
830.0
35.6
74.10
163.13
37.30
191.82
306.00
2.46
258.29
742.50
10.21
194.07
384.29
59.39
0.26
16.33
43.37
87.86
19.19
5.23
104.15
4.07
0.12
178.00
2.12
18.35
16.88
0.09
0.67
0
16.38
5.73
33.10
1.30
VOC Emission
Factor
Lbs. Solvent
(gal. coating)
Current
Volume
% Solids
5.33
5.81
5.81
6.70
6.30
6.70
6.30
4.50
6.08
6.08
4.50
4.71
4.71
5.89
4.34
7.04
60
25
25
25
25
25
25
33
18.5
18.5
26.7
3.6
3.6
2.0
4.1
04.4
6.53
3.93
6.09
5.56
0.56/100 gal.
0.03 Ib./lb.
6.30
6.41
4.17
6.53
73
28
6.75
3.99
4.49
4.17
4.27
07.0
46.7
17.3
24.5
91.4
12.9
43.4
14.0
27.0
32.0
10.0
45.8
39.0
43.3
42.0
VOC Emission
Factor
Lbs. Solvent
(gal. solids)
8.88
23.24
23.24
26.80
25.20
26.80
25.20
13.64
32.86
32.86
16.85
13.08
13.08
29.45
'10.59
160.00
93.29
8.42
35.20
13.35
6.1 x 10~3
49.69
9.61
46.64
21.22
16.50
67.50
8.71
11.51
9.63
10.17
RACT Emission
Factor
Lbs. Solvent
(gal. coating)
2.8
4.2
5.5
2.8
4.2
4.2
5.5
3.7
4.2
4.2
3.7
2.8
2.8
4.2
3.7
4.2
5.5
2.8
5.5
4.2
3.7
2.80
5.50
3.70
4.20
5.50
5.50
5.50
.70
.70
.70
.70
Fall River Canning
Can coating
6.41
8.30
14.0
59.40
5.50
-------
EXHIBIT 3-11(2)
U.S. Environmenta] Protection Agency
File
Number
41001
410026
410089
410357
520075
680375
Continental Can Co.
American Can Co.
Miller Brewing Co.
Jos. Schlitz
Brewing Co.
Continental Can Co.
Continental Can Co.
320020
1300
140020
Continental Can Co.
Oconomowoc Canning Co.
Carnation Company
Process Description
P-30 Varnish
P-32 Lacquer spray
P-33 Can assembly
P-32
P-33
P-36
P-37
P-39
P-31 Bottom coater
P-32 Inside coat sprayer
P-33 End linine compound
Exterior basecoat
Exterior overvarnish
Interior spray coat
End sealing compound
P-31 I-acquer sprays
P-30 Assembly section
P-30 Misc. solvents
P-31 r.itho line
P-32 Coating line
P-33 Can forming line
P-34 Inside spray
P-35 Can liner
P-36 Litho press
Coating
3-piece side seam
End sealing compound
2- & 3-piece can interior
3-piece side seam
563-803
163-812
P259
End sealing compound
9179
91014
1105
1108
RACT
Volume
% Solids
62
44
25
62
44
44
25
50
44
44
50
62
62
44
50
44
25
62
25
44
50
RACT Emission
Factor
liis . Solvent
(gal. solids)
4.52
9.55
22.00
4.52
9.55
9.55
22.00
7.40
19.55
9.55
7.40
4.52
4.52
9.55
7.40
9.55
22.00
4.52
22.00
9.55
7.40
Percent
Solvent
Reduction
49.2
58.9
5.3
83.1
62.1
64.4
12.7
45.7
70.96
70.96
56.1
65.5
65.5
67.6
30.1
94.0
76.4
75.0
46.3
0.0
37.5
28.5
0.0
0.0
Emission
Reduction
TPY
357.90
489.09
• 1.90
61.61
101.34
24.01
24.36
139.94
1.75
183.28
416.49
6.69
127.08
259.73
17.87
0.24
12.48
32.53
40.71
0.00
1.96
29.66
0.00
0.00
VOC Emission
Under RACT
TPY
370.10
340.91
33.70
12.49
61.79
13.29
167.46
166.06
0.71
75.01
326.01
3.52
66.99
124.56
41.52
0.02
3.85
10.84
47.15
19.19
3.27
74.49
4.07
0.12
62
25
50
44
25
25
25
50
50
50
50
4.52
22.00
7.40
9.55
22.00
22.00
22.00
Assumed 60
55.7
23.0
79.5
0
0
67.4
40
40
40
40
15.
35.
23.
27.2
106.8
1.18
4.22
13.43
0
0
0
2.47
2.05
7.67
0.35
71.2
0.94
14.13
3.45
0.09
0.67
O
13.91
3.68
25.43
0.95
Fall River Canning
Can coatinq
25
22.00
-------
The RACT guidelines have established different limitations
for each of four groups of can coating operations. Exhibit
3-12, on the following page, presents the recommended VOC
limitations, compared with typical, currently available, con-
ventional 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 Wisconsin as well
as nationally.
The industry preferred response will be to
use low solvent coatings (primarily water-
borne) wherever technically feasible because
of their low cost—see incremental cost
comparisons on Exhibits 3-14 and 3-15.
The choice between thermal in-
cinerators and catalytic incin-
erators will be based on the
availability of fuel and the
preference of the individual
companies.
Incinerators with primary heat
recovery will be used in pre-
ference 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 several can plants
that have evaluated this control approach.
Ten likely control alternatives, as well as the
three base cases, are discussed in the following
paragraphs. The percentage of cans likely to be
manufactured by each of the control options, by
1982, is summarized in Exhibit 3-13, following
Exhibit 3-12. The resulting emissions are
summarized in Exhibits 3-14 and 3-15, at the
end of this section. For cases involving incin-
eration, the following assumptions were made.
3-14
-------
EXHIBIT 3-12
U.S. Environmental Protection Agency
RACT GUIDELINES FOR CAN COATING OPERATIONS
Typical Currently
Available
Coating Operation Recommended Limitation Conventional Coatings
kg. per literIbs. per gallon Ibs. per gallon
of coating of coating of coating
(minus water) (minus water) (minus water)
Sheet basecoat (exterior) 0.34 2.8 4.1-5.5
and interior) and over-
varnish; two-piece can
exterior (basecoat and
overvarnish)
Two- and three-piece can 0.51 4.2 6.0
interior body spray,
two-piece can exterior
end (spray or roll coat)
Three-piece can side-seam 0.66 5.5 7.0
spray
End sealing compound 0.44 3.7 4,3
Source; U.S. Environmental Protection Agency
-------
EXHIBIT 3-13
U.S. Environmental Protection Agency
PERCENTAGE OF CANS TO BE MANUFACTURED
IN 1982 USING EACH VOC CONTROL ALTERNATIVE
VOC Control Alternatives
Low Solvent
Water- Coatings
borne or Thermal Except UV Cured
Type Other Low Incineration Print Only, End Sealant Outside Varnish
of Can Solvent with Primary All Low Solvent Which Is Waterborne
Manufactured Coatings Heat Recovery Coatings Incinerated Inside Spray
2-piece beer 40 10 50
and soft
drink
3-piece beer 25 10 — 65
and soft
drink
3-piece food 25 20 — 55
and other
cans
Source: Booz, Allen & Hamilton, Inc.
-------
Energy cost is $2.25 per million
UTIlc
BTUs.
Capital cost is $20,000 per 1,000
CFM.
Incinerators operate at 10 percent
of the lower explosion limit.
90 percent of the roller coating
emissions are collected and incin-
erated.
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 Wisconsin are produced with one exterior coat-
ing, a procedure defined as print and varnish.
The can is printed directly over the base metal
and then varnished using a low solids organic-
borne varnish—eliminating the base coat.
The interior of the can is sprayed, using a non-
comforming interior body spray.
The end of the can is spray coated, using a non-
comforming body spray.
In this base case alternative, no incineration is assumed
although, in fact, most of the operations in Wisconsin currently
incinerate some of the emissions to control the particulates.
The coating consumption is approximately 250 gallons per million
cans, resulting in emissions 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.
3-15
-------
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
capital cost is 25 percent of the total installed
capital cost and that 250 million cans are pro-
duced annually on the coating line.
The cost of the coatings is the same as for
conventional coatings—industry sources
believe that by 1980 this will be the case.
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 in
Wisconsin.
The capital required for three incinerators
would be about $66,000—at $20,000 installed
cost per 1,000 CFM.
Annualized capital cost includes depreciation, interest, taxes
insurance and maintenance.
3-16
-------
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.
The cost of incineration is about $441 per ton of emission
removed. It is estimated that 10 percent two-piece can pro-
duction will utilize this alternative by the end of 1981—some
of the 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 opera-
tions—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.
3-17
-------
The elimination of one coating operation would result
in a net saving of about $750 per million cans, composed 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 50 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.
The energy saving is about $105 per million
cans.
The annualized capital cost for converting
the coating systems to UV cured and water-
borne 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 imple-
mented 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
3-18
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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 a 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.
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.
3-19
-------
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 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 cost to convert to waterborne coat-
ings 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 cur-
rently employed in the base case are retrofitted with thermal
incinerators.
The capital required for five incinerators would be about
$320,000—assuming an installed cost of $20,000 per 1,000 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.
The total incremental cost of adopting thermal incinera-
tion 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 esti-
mated that it will be employed only on 10 percent of all
three-piece beer and soft drink cans manufactured in Wisconsin
in 1982.
3-20
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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 65 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.
3.3.4.11 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 of
waterborne coatings will be available to meet industry
requirements by 1982 because:
3-21
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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 avail-
able 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.
The total incremental cost of this scenario is about
$200 per million cans; $192 in capital cost and $17 in energy
costs. The emissions are reduced by about 79 percent to 0.25
tons per million cans. It is estimated that 55 percent of
the cans would be produced using this approach.
3-22
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EXHIBIT 3-14
U.S. Environmental Protection Agency
EMISSIONS FROM COATING TWO-PIECE ALUMINUM
BEER AND SOFT DRINK CANS PER MILLION CANS
Alternative
Annualized Incremental Costs
Annualized
Capital Coat Materials Energy Total
($) <$) ($) ($)
voc
Emissions
(tons)
Emissions
VOC
Decrease
(tons) %
Incremental
Cost
(per ton)
1978 BASE CASE 0
Print and varnish
Nonconfirming interior
body spray (exempt
solvents)
Find coating
WATERBORNE AS PROPOSED 120
IN RACT
BASE CASE WITH THERMAL 266
INCINERATORS &
PRIMARY HEAT RECOVERY
SUPPLEMENTAL SCENARIO 1 80
Print only
Waterborne interior
body spray
End coati ng using a
low varnish solvent
SUPPLEMENTAL SCENARIO 2 120
Print
UV cured varnisli
Waterborne interior
body spray
End coating using a
low solvent varnish
250
0.67
30
66
20
30
540
62
230
30
128
750
340
250
200
810
JOS
734
240
0.19 0.48 75
0.39 0.29 42
0.15
0.52
78
63
441
0.14 0.53 79 1415
1411
a. Not Applicable
Source! Booz, Allen & Hamilton Inc. estimates
-------
EXHIBIT 3-15
U.S. Environmental Protection Agency
EMISSIONS PROM COATING THREE-PIECE
CANS PER MILLION CANS
Case
Annualized Incremental Costs
Capital
(S)
Annualized
Capital
Coat/Milliona Materials Energy Total
<$) ($) ($) ($)
Coating And Emissions
VOC
Emissions
(tons)
VOC
Decrease
(tons) %
Incremental
Cost
($ per ton)
1978 BASE CASE
Interior base coat
Decoration and/or
varnish
Interioring and
exterioring stripe
Interior spray
End sealant
WATERBORNE AS PROPOSED
IN RACT
BASE CASE WITH THERMAL
INCINERATORS AND HEAT
RECOVERY PRIMARY
SUPPLEMENTAL SCENARIO 3
Waterborne except end
sealant which is incin-
era ted
416
2670
686
104
668
171
BEVERAGE CANS
0 0
894
104
166 834
20 191
720
694
715
1.79
0.34 1.45 81
0.74 1.05 59
0.35 1.44 80
72
794
133
1978 BASE CASE
Interior base coat
Exterior base coat
Interior stripe
End sealant
WATERBORNE AS PROPOSED
IN RACT
BASE CASE WITH THERMAL
INCINERATORS AND
PRIMARY HEAT RECOVERY
SUPPLEMENTAL SCENARIO 4
All waterborne except
end sealant which is
incinerated
453
2380
768
113
595
192
FOOD CANS
0 0
95 687
95 687
17 209
424
439
424
435
0.99
0.24 0.75 76
0.19 0.80 81
0.23 0.76 77
151
859
275
a. Not Applicable
Source•. Dooz, Allen S 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 emissions 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
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Capital and annualized costs for each of the representative
plants are presented for each applicable alternative on Exhibit
3-16, on the following page. In summary, the capital cost to
adopt the alternative controls to the four representative plants
ranges from $20,000 (to convert the can assembly plant to water-
borne coatings) to more than $400,000 (to retrofit the three-
piece coating and assembly plant with incinerators). The incre-
mental 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).
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,
consumption patterns or other areas not directly related to
RACT 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 Wisconsin 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, Wisconsin costs can be
readily estimated from data developed on a nationwide basis.
Extrapolation of the costs to the statewide industry
requires, first, segmenting the industry in Wisconsin 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 pre-
sented in section 3.2.3.
Emissions (per million cans) from the pro-
duction of cans using the various coating
operations were presented in Exhibits 3-7,
3-8 and 3-9 and combined on Exhibits 3-14
and 3-15, for several control alternatives
for the major types of cans (including
print only).
3-24
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EXHIBIT 3-16
U.S. ENVIRONMENTAL PROTECTION AGENCY
COST OF IMPLEMENTING RACT ALTERNATIVES FOR
REPRESENTATIVE CAN MANUFACTURING PLANTS ($1,000)
Representative Plant
Waterborne
Waterborne Thermal Incinerators Print Only/Waterborne UV Cured/Waterborne Incinerate End Sealant
Capital Annual Capital Annual Capital Annual Capital Annual Capital Annual
Expense Expense Expense Expense Expense
A. 2-piece beer fi soft 60
drink can
2 lines
500 million cans
B. 3-piece beer & soft 100
drink and food can
coating and assembly
plant
1 coating line
1 sheet varnish line
3 assembly lines
310 million cans
C. Sheet coating facility 30
for 50% beer cans fi
50% food cans
1 sheet coating line
1 sheet varnishing line
1 end compounding line
Supplies stock for 290
million cans
15
25
132
415
64
387
40
(375)
60
367
138
106
255
143
82
34
D. Food can assembly plant
2 assembly lines
with inside striping
144 million cans
20
60
20
a. Not applicable
b. Not considered to be a likely response by 1982
Source: Booz, Allen S Hamilton Inc. estimates
-------
Theoretical uncontrolled emissions were cal-
culated by multiplying the number of cans
of each type by the 1977 least case alterna-
tive on Exhibits 3-14 and 3-15. This estimate
of 4,487 tons was presented in section 3.3.2.
Because the data in the Wisconsin emissions
inventory were incomplete, the assessment of
the current situation was based primarily on
the data collected from the interviews and
the work completed for other states in EPA
Region V. Net emissions were reduced to
the 1977 base line of 4,100 tons to 4,200
tons.
300-400 tons through incineration
Significant solvent coatings usage
is believed to have begun in 1978
and therefore was not included in
the baseline adjustment.
The industry response in 1982 to the RACT alternatives
was presented in section 3.3.4 and summarized on Exhibit 3-
13. It included a discussion of the cost and emission
reductions from the theoretical level of uncontrolled emis-
sion. Exhibit 3-17, on the following page, shows that
likely industry capital expenditures of $2.6 million will be
required to comply with RACT. The annualized compliance cost
is estimated at $100,000, excluding a credit of $600,000 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 package materials. It is
estimated that emissions will be reduced by 2,600 tons from
the theoretical level of 4,500 tons, excluding an additional
400 ton reduction that is expected to result through the
increased usage of print only. Because of the annual cost
savings involved, the industry will probably take the steps
indicated for two-piece cans whether or not the regulation
is in place. The capital cost applicable to the regulation
is estimated at $2.62 million. It would be $50,000 to
$100,000 higher without the conversion to print only.
Annual unit cost of emission reduction is estimated to
be $277 per ton. Three-piece food and other cans have the
highest unit cost, $360 per ton. The incineration of can
ends also has a high unit cost, $409 per ton.
3-25
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EXHIBIT 3-17(1)
U.S. Environmental Protection Agency
COST OF COMPLIANCE TO RACT FOR THE
CAN MANUFACTURING INDUSTRY IN WISCONSIN
CAN TYPE
Can Production
(millions of units)
Water-
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
Capital Investment
(thousands of S)
Water-
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
2-Piece
Beer and
Soft Drink
640
160
BOO
1600
77
43
64
184
Can Ends
for 2-Piece
Cans
85
85
3-Piece
Beer and
Soft Drink 225
90
585
900
94
240
401
735
3-Piece
Food and
Other Cans
Subtotal
400
320
880
1,600
4,100
181
352
762
1,045
64
676
1,162
1,619
2,623
-------
EXHIBIT 3-17(2)
U.S. Environmental Protection Agency
CAN TYPE
Annual Compliance Cost
(thousands of $)
Emission Reduction
(tons)
Low Solvent
Water- Coatings
borne or Thermal Except
Other Low Incineration Print Only, End Sealant
Solvent with Primary All Low Solvent Which Is
Coatings Heat Recovery Coatings Incinerated Total
2-Plece
Beer and
Soft Drink 19 20 (600) 0 (561)
Can Ends
for 2-Piece
Cans a a a 27 27
3-Piece
Beer and
Soft Drink 23 75 0 100 198
3-piece
Food and
Other Cans 45 221 0 176 442
Subtotal 87 316 (600) 303 106
Less Con-
trols in
Place a 20 a a (20)
Less
Amount
Not RACT a a 624 a 624
TOTAL
RACT 67 296 24 303 71O
Low Solvent
Water- Coatings
borne or Thermal Except Unit
Other Low Incineration Print Only, End Sealant Cost of
Solvent with Primary All Low Solvent Which Is Emission
Coatings Heat Recovery Coatings Incinerated Total Reduction
($ per ton)
307 46 424 a 777 (722)
a a a 66 66 409
326 94 a 842 1,262 157
300 256 a 669 1,225 360
933 396 424 1,577 3,330 32
a 340° a a 340 a
a a 424 a 424 a
933 56 0 1,577 2,566 277
a. Not Applicable
b. One billion can ends coated
c. Averaqe of estimate
Source: Boo?., 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 inter-
mittent. 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 maintain capa-
bility to utilize both conventional and low solvent coatings, the
projections would be changed as follows:
Capital expenditure would be increased
by $3.2 million or 125 percent.
Annual cost would increase by $800,000.
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 Wisconsin
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 4,150 tons,
implementation of RACT will reduce emissions by approximately
2,550 tons to the same 1,600 tons (excluding the additional 400
ton reduction for conversion to print only). The 1982 reduction
is expected to emphasize waterborne coatings rather than inciner-
ation. Assuming that no new incinerators will be constructed,
the capital cost for converting from the existing level of
control in 1977 to meet the RACT guidelines would be about
$500,000.
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 suffi-
cient quantity to meet their volume
requirements
Acquiring the necessary VOC control equip-
ment
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 excep-
tion, RACT can be achieved by January 1, 1982, using low
3-27
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solvent coatings—primarily waterborne. The coating most
likely to be unavailable in 1982 is the end sealing com-
pound. 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.
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!zed cost of implementing RACT with the total
value of cans sold in the state
The net incremental annualized cost from the uncontrolled
level to can manufacturers is estimated to be $0.1 million
(less than 0.1 percent) of current manufacturing costs. How-
ever, this includes a credit of $624,000 for reduced material
and energy costs that arise from reducing the number of coat-
ings on two-piece cans. Excluding this credit, meeting the
RACT limitations would represent an annualized cost of $710,000
(approximately 0.2 percent of the value of shipments).
3.5.4 Ancillary Issues Relating to the Impact of RACT
This section presents two related issues that were
developed during the study.
The can manufacturers are seeking to have the guidelines
altered to encompass a plantwide emission 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.
3-28
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High solvent coatings represent a considerable fire hazard.
The conversion to low solvent coatings had reduced fire insurance
costs for at least one can manufacturing facility.
Exhibit 3-18, on the following page, presents a summary
of the current economic implications of implementing RACT
for can manufacturing plants in the State of Wisconsin.
3-29
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EXHIBIT 3-18
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR CAN iMANUFACTURING PLANTS
IN THE STATE OF WISCONSIN
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 control to meet
RACT guidelines
Discussion
There are eight major can manufacturing
facilities and seven other satellite
plants manufacturing fabricated metal
food cans from precoated stock
1977 Value of Shipments was $350 million.
Industry is closely related to state's
brewing and dairy industries
Beer and beverage containers rapidly
changing to two-piece can construction
4,100-4,200 tons per year
Low solvent coatings (waterborne)
Low solvent coatings (waterborne)
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
$2.6 million from uncontrolled state;
approximately 13 to 25 percent of
current annual capital appropriations
for the industry; $1.5 million above
1977 in-place level
$100,000 (approximately 0.1 percent
of current direct annual operating
costs)
No price increase
Increase of 4,000 equivalent barrels of oil
annually for operation of facilities
that have to utilize incinerators (1,000
equivalent barrels above 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 for end sealing
compound will probably not be available
Low solvent coating technology
for end sealing compound
1,200 tons per year (29 percent
of 1977 emission level)
$277 annualized cost/annual ton of VOC
reduction from theoretical level attributed
to implementation of RACT
Source; Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
Control of Volatile Organic Emissions from Existing 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 WISCONSIN
-------
4.0 THE ECONOMIC IMPACT OF IMPLEMENTATION
OF RACT GUIDELINES TO THE SURFACE COATING
OF COILS IN THE STATE OF WISCONSIN
As will be shown in this chapter, economic impacts will
result from the implementation of RACT standards to the coil
coating businesses in the state of Wisconsin.
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 Wisconsin
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 Wisconsin.
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 Wisconsin 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.
Because the majority of coil coating operations are captive,
data on the value of shipments were not available. Also the
number of employees in this industry category were not available.
4.1.2 VOC Emissions
Booz, Allen developed a listing of three facilities, identified
as hydrocarbon emitters in the surface coating of coils covered
by RACT in the state of Wisconsin. This listing of industries
subject to RACT guidelines for hydrocarbon emissions and the emis-
sion data are based on information provided by the Wisconsin
Department of Natural Resources. The list, therefore, may not be
all inclusive, or it may include some industries that may not be
actually performing the coating operations indicated or identified
by the RACT category. The emissions for 1977 and only those facili-
ties with greater than two tons per year emission are included.
4-2
-------
4.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for the surface
coating of coils are described in 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.
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
Developing 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,
4-3
-------
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
Wisconsin.
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 Wisconsin. 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
X
Overall quality of data
X
Source: Booz, Allen & Hamilton Inc.
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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 (EPA-905/2-78-001)
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
-------
EXHIBIT 4-2
U.S. Environmental Protection Agency
DIAGRAM OF A COIL COATING LINE
ACCUMULATOR
SPLICER
U
UNCOILING
METAL
Q
ACCUMULATOR
PRIME
COATER
METAL CLEANING PRETREATMENT
_d
PRIME
OVEN
PRIME
QUENCH
£
SHEAR
TOPCOAT
COATER
TOPCOAT
OVEN
TOPCOAT
QUENCH
U
RECOILING
METAL
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).
-------
EXHIBIT 4-3
U.S. Environmental Protection Agenc
TYPICAL REVERSE ROLL COATER
INTO OVEN
APPLICATOR 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 explosion
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 squeegee 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
(EPA-905/2-78-001) 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
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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.
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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.
The model is applied to individual firms where information
is not available concerning the costs of implementing the RACT
alternatives.
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
Case
Total
Investment
S
Increase
over
Base Case
$
Total
Annual
Cost
5
Increased
Annual Cost
over
Base Case
$
Cost/Unit
1000 SF
(1000 SM)
$
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 Ton)
To Remove
Solvent
$
I Base Case - 3,300,000
solvent-borne
primecoat
s topcoat
2,977,400
14.59
(157.05)
832.3
(755)
II . Waterborne 3,350,000 50,000 2,985,800 8,400
primecoat
s topcoat
14.64 0.05 0.3
(157.58)
98.9
(89.9)
733.4
(665.1)
88
11.45
(12.63)
III Base Case with 3,554,260 254,260 3,052,860 75,460
thermal incin-
erators on
ovens; primary
heat recovery
14.96 0.37 2.5
(161.03)
158.1
(143.5)
674.2
(611.5)
81
111.93
(123.40)
Source: Booz, Allen S Hamilton Inc.
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4.3 COIL COATING OPERATIONS IN THE STATE OF WISCONSIN
At present, there are three coil coating operations in
Wisconsin. Details pertinent to these operations are shown
in Exhibit 4-6, on the following page. Of the three firms
listed, one (Inryco) has installed an incinerator and is
assumed to meet the RACT guidelines. The Rollex Corporation
and the Mirro Company have one line each which has not imple-
mented emission control equipment.
4-10
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EXHIBIT 4-6
U.S. Environmental Protection Agency
COIL COATING OPERATIONS IN WISCONSIN
Company
Inryco
Rollex Corp.
Mirro Inc.
Total
No. of Coil
Plant Location Coating Lines
Milwaukee, WI
Ixonia, WI
Manitowoc, WI
1
1
Present
Emissions
(tons/yr)
26
227
250a
503
Type of Emission Control
Coatings Equipment
Solvent
Solvent
Solvent
Incinerator
None
None
Comment
Currently meeting RACT
Presently not in
"compliance
Presently not in
compliance
a. Estimated from paint usage data provided by Mirro.
Source: Booz, Allen & Hamilton Inc.
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4.4 DIRECT ECONOMIC IMPLICATIONS
Application of RACT standards to the coil coating
business in Wisconsin will have an economic impact on the
companies affected. Of the three identified coil coating
operations in Wisconsin, two would be required to add
emission control procedures.
The two companies affected were interviewed by the Booz,
Allen study team, and both expressed concern over the economic
viability of their firms, if they were required to make major
capital investments for incineration to meet RACT requirements.
Both companies are looking into waterborne and high solids
enamels as possible substitutes for their conventional enamel
systems; however, enamel substitute coatings that will meet
customer requirements have not yet been developed.
The Rollex Company indicated that if it were required to
implement the incineration option to meet RACT, then major
building alterations will be required. This cost would
however, be significantly greater than the estimated $75,000
to $100,000 capital cost of the incinerator; and, in the judg-
ment of the Booz, Allen study team, could run four to five times
the equipment cost or between $300,000 and $500,000 in installed
costs. As indicated by Rollex, this capital requirement would
seriously threaten the economic solvency of the company.
The Mirro Company has estimated that it would cost them
$100,000 in capital and $100,000 to install an incinerator
to meet RACT. They indicate that this amount of capital outlay
would represent a financial hardship on the company that could
threaten its economic viability. They are looking into high
solids or waterborne enamel substitutes to meet RACT but have
not yet found a system that will adequately meet their customers'
requirements.
Since costs for possible building modification by Rollex
are not available, the total capital costs for implementation of
incineration for both companies affected cannot be estimated
with a great deal of accuracy.
Exhibit 4-7, on the following page, summarizes the findings
presented in this chapter. y
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 WISCONSIN
Current Situation
Number of potentially affected facilities
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
There are three coil coating facilities
potentially affected by the coil coating
RACT guideline in Wisconsin. One firm
currently meets RACT emission limitations
Due to the pressures of energy availability
as well as environmental protection, most
firms have installed or intend to install
regenerative-type incinerators
503 tons per year, of which 447 tons is
subject to RACT compliance
Regenerative thermal incineration; high
solids or waterborne enamels
Regenerative thermal incineration
Affected Areas in Meeting RACT
Capital Investment (statewide)
Annualized Cost (statewide)
Energy
Productivity
Employment
Market structure
RACT timing requirements (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$700,000 incremental capital required by one
firm if they were to install controls on a
new processing line
?175,000
Assuming 70 percent heat recovery, energy
requirements are expected to increase
by approximately 2,300 equivalent barrels
of oil annually
No major impact
No major impact
The captive coil coating operation not
meeting the RACT limitation may opt to
purchase coated material in lieu of in-
vesting significant capital requirements
Implementation of thermal incineration
may be delayed due to delivery installation
problems
Low solvent coating technology is currently
inadequate to meet product requirements
116 tons per year. (23 percent of 1977 VOC
emission level).
$490 annualized cost/annual ton of COC
reduction
Source; Booz, Allen & Hamilton Inc.
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BIBLIOGRAPHY
Springborn Laboratories Inc.
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.
EPA-450/2-77-008, May, 1977
U.S. Environmental Protection Agency, Regulatory
Guidance for Control of Volatile Organic Compound
Emissions From 15 Categories of Stationary Sources.
EPA-905/2-78-001, April, 1978
Private conversations with the following:
National Coil Coaters Association
Alsar Inc., Southfield, Michigan
Wolverine Aluminum Corp., Lincoln Park, Michigan
Rollex Co., Ixonia, Wisconsin
Mirro Co., Manitowoc, Wisconsin
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5.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR PLANTS
SURFACE COATING PAPER IN THE
STATE OF WISCONSIN
-------
5.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR PLANTS
SURFACE COATING PAPER IN THE
STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT for plants in the State of Wisconsin 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 esti-
mates
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 and coating equipment
and materials manufacturers; and a review of pertinent pub-
lished 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 Lockwoods1 Directory 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.
The majority of VOC emissions from paper coating result
from coating done by firms in SIC grouping 2641, paper
coating and glazing. However, because of the total number
of firms which may coat paper as part of their normal busi-
ness, we have included in our industry statistics the data
for all firms grouped in the list above.
We have relied heavily on the Wisconsin emission inven-
tory to identify the firms expected to be affected by the
proposed paper coating regulations and their reported emissions,
In some cases, telephone interviews were made with plant per-
sonnel to confirm this information.
5.1.2 VOC Emissions
The Wisconsin emission inventory was used as a basis for
estimation of the total VOC emissions to be expected in the
state. Though the inventory may be incomplete, it is
expected to account for the majority of the emissions in the
state and for large single sources. The inventory, however,
may omit a number of small firms that have low total emis-
sions 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
document 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
controlled by reformulation and by control devices was
estimated 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
Type of control to be used-coating reformu-
lation or control device
A development of capital, operating and energy
requirements for use of a control device for
an average-sized model installation
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 sup-
pliers 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.
Both coaters and equipment manufacturers were consulted
to obtain their opinions on the likelihood of meeting proposed
RACT compliance schedules. In all interviews made, proposed
schedules appeared to be unrealistic; therefore, these firms
were asked to estimate their likely costs based on the assump-
tion that equipment will be available for their selected
control option.
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 Wisconsin.
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
Wisconsin. 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.
It should be noted that the economic estimates pre-
sented in this report are based primarily on the State of
Wisconsin Department of Natural Resources emission inventory.
Although the identification of the number of firms affected
by this regulation may not be complete, it is considered
that the largest emitters are included and that the emissions
inventoried include 80 percent or more of the total emissions
in the paper coating category.
5-5
-------
EXHIBIT 5-1
U.S. Environmental Protection Agency
DATA QUALITY—SURFACE COATING OF PAE
Study Outputs
A
Hard Data
B
Extrapolated
Data
Estimated
Data
Industry statistics
Emissions
X
Cost of emissions control
X
Economic impact
X
Overall quality of data
X
Source: Booz, Allen & Hamilton Inc.
-------
5.2 INDUSTRY STATISTICS
Industry characteristics, statistics and trends for
paper coating in Wisconsin 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 in which the only major activity is
paper coating.
5.2.1 Size of the Industry
The Bureau of Census reports a total of 255 firms in
16 SIC categories in Michigan 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.
The 79 firms in SIC category 2641, those expected to
be most affected by the proposed regulations, have estimated
payroll of $157 million, with a total of about 11,300 employees,
However, the Wisconsin inventory actually indicates a
total of ten plants expected to be covered under the paper
coating RACT category and only two of these list themselves
under SIC category 2641. The number of employees estimated
to be employed by these firms is 5,577.
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 2.8 percent of the total
value of shipments in Wisconsin. The industry employs 2.0
percent of all manufacturing employees in Wisconsin, with a
payroll equal to about 2.2 percent of the state total for
all employees in manufacturing industries.
The ten plants affected are estimated to have annual
shipments of about $420 million, based on an average of
about $75,000 per employee.
5-6
-------
SIC Code
Description
2611
2621
2631
2641
2643
2645
2649
2651
3291
3292
3293
3497
3679
3842
3861
3955
Total
Pulp mills
Paper mills, except building
paper mills
Paperboard mills
Paper coating and glazing
Bags, except textile bags
Diecut paper and paperboard
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, protetic and
surgical appliances and supplies
Photographic equipment and
supplies
Carbon paper and inked ribbons
a. Not listed to protect proprietary information.
b. None
EXHIBIT 5-2
U.S. Environmental Protection Agency
1976 INDUSTRY STATISTICS—SURFACE
COATING OF PAPER SIC GROUPS IN WISCONSIN
Number
of
Plants
7
43
5
79
15
7
8
11
10
b
8
b
28
22
12
b
Total
Number of
Employees
750
18,223
938
11,339
407
345
550
898
1,500
b
71
b
901
929
750
b
Total
Payroll
(§1,000)
a
281,739
14,177
157,108
4,268
3,847
5,600
10,800
a.
b
1,029
b
9,085
7,627
a
b
255
37,611
495,280
-------
5.2.3 Historical and Future Patterns of the Industry
The national 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. Compared to an average inflationary rate of 6 per-
cent to 8 percent, this is equivalent to a real growth rate
of 4 percent 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 growth 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
3497
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
1974
36,035
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; 1976 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. Also
discussed are estimated VOC emissions for the state.
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 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
solvent 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-solventborne
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.
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.
2EPA - 450/2-76-028, Op. Cit.
5-9
-------
EXHIBIT 5-4
U.S. Environmental Protection Agency
EMISSION DATA FROM TYPICAL PAPER COATING PLANTS
Number
of coating
Lines
2
5
8
2
10
20
3
3
1
a. Neglecting
Solvent
Usage
(Ib./day)
10,000
15,000
9,000
1,200
24,000
55,000
5,000
21,000
10,500
emissions that are not captured
Source: Control of Volatile Organic Emissions
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
in the hooding system.
from Existing Stationary Sources
Control
(%)a Device
None
None
None
None
Carbon
adsorption
Carbon
adsorption
(not all lines
controlled)
Carbon
adsorption
Carbon
adsorption
Afterburner
(EPA-450/2-76-028) .
-------
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
UNWIND
HOT AIR NOZZLES
REVERSE ROLL
COATER
^
— 1 f • 4 • •
--^0 o
it M ~~
o o ^
OVEN
TENSION ROLLS
REWIND
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
-------
EXHIBIT 5- 6
U.S. Environmental Protection Agency
KNIFE COATER
EXCESS COATING
•LADE
COATED WEB
PAPER WEB
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
-------
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 (110°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 WEB
BACKING ROLL
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 are possible with common
paper coating.
5.3.3 Current VOC Emissions
This section presents the estimated VOC emissions from
paper coating operations in Wisconsin for the year 1977,
based on the Wisconsin Department of Natural Resources in-
ventory of air pollution sources. A summary of this inven-
tory and applicable emissions for the paper coating RACT
category is presented in Exhibit 5-8, on the following page.
Plants listed are believed to represent the major single
sources of emissions in the state and in total represent
the major portion of paper coating emissions.
5.3.4 RACT Guidelines
The RACT guidelines 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.
5-12
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EXHIBIT 5-8
U.S. Environmental Protection Agency
PLANTS EXPECTED TO BE AFFECTED BY
PROPOSED PAPER COATING REGULATIONS
Estimated
Plants
Akrosil Corp.
American Can Co.
Neenah Plant
American Can Co.
River Street Plant
American Can Co.
Wausau Plant
Central Paper Co.
Milprint Inc.
NCR Appleton Papers
Shade Information
Systems
Thilmany Pulp and
Paper
W.H. Brody
Location
Menasha
Neenah
Menasha
Wausau
Menasha
Milwaukee
Appleton
DePere
Kaukauna
Milwaukee
Applicable
Emissions
(tons/yr)
327
1,366
1,496
12
170
1,322
144
381
969
206
Number of
Employees
95
420
550
605
210
687
1,152
222
1,586
50
6,393
5,577
-------
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 inch thick.
This avoids the necessity of multiple passes through a
coating machine.
Although organic solvents are not evaporated from
plastisols, some of the plasticizer may volatilize in the
oven. This plasticizer will condense when emitted from the
exhaust stack to form a visible emission.
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 450/2-76-028, op. cit.
-------
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
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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
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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 percent to 10 percent or more of their
lower explosion limit (LEL).
Oven temperatures are sufficiently high to
enable use of most of the sensible heat in
the exhaust gases after primary heat ex-
change. Usually, temperatures above 140°F
to 150°F can be sufficient to allow 85 per-
cent or more overall 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 for-
mulations, 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 Wisconsin Department of Natural
Resources 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 that either incineration 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.
Many 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, to achieve
special characteristics, they could not increase emission
concentrations above 5 percent 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
INCINERATION COSTS FOR A TYPICAL PAPER
COATING OPERATION
Incineration Device
No heat recovery
Catalytic
Noncatalytic
(Afterburner)
Installed Cost
($)
155,000
125,000
Annualized Cost
($/yr.)
100,000
105,000
Control Cost
($/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
28a
13*
Note: Typical operation parameters are: process rate of 15,000 scfm; temperature of 300°F,
operation at 25 percent of LEL. Costs are believed to be valid for mid-1975.
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
($1
320,000
Annualized Cost
($/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)'
Note: Operating parameters are: process rate of 15,000 scfm, temperature of 170°F,
operation at 25 percent of LEL. Costs are believed to be valid only for mid-1975.
a. Costs in parentheses indicate a net gain.
Source: EPA-450/2-77-008
-------
Both incinerator costs and adsorber costs are a func-
tion of equipment size and vary generally with air flow
rate. It was assumed based on similar studies on paper
coating in other states for projection of overall costs
in the state that control equipment, on the average, would
be sized for 2,800 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. For this reason and the lack of detailed information
on each plant, it was also assumed that only primary heat
recovery would be used. This assumption only slightly
decreases capital costs and has a moderate effect upon annual-
ized costs since the higher capital costs associated with
secondary heat recovery are offset by fuel savings.
Because of the lack of the suitability of recovered
solvent for in-process uses, it was assumed that recovered
solvent would only be credited at fuel values.
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 450/2-77-008, 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 and the pos-
sible need for new ovens for 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
incinerator with secondary heat recovery was installed, total
project cost was about five times the base price of the incin-
erator. The major cost was not the incinerator but the require-
ment 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, estimates^ $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;
T.A. Kittleman and A.B. Akell, "The Cost of Controlling Organic
Emissions," Chemical Engineering Progress, April 1978.
5-20
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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.
5.4.2 Estimated Statewide Costs
The total emissions considered to be applicable under RACT,
as tabulated in Exhibit 5-8, are about 6,400 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 emission inventory as summarized in Exhibit
5-8, in Section 5.3.3, ten firms will probably be affected by the
proposed regulations. Using an average of 2,800 scfm per add-on
control device, the assumptions discussed in the previous section,
a total of about 18 add-on control devices—five carbon adsorbers
and 13 incinerators—would be required. 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 Emissions from Existing
Stationary Sources, Vol. I; Control Methods for Surface-Coating
Operations, EPA-450/2-77-008.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 in Sec-
tion 5.4.1, the base costs in the EPA-450-77-008 report are low
by a factor of three to four, since they do not reflect diffi-
cult retrofit factors and other capital requirements in a complete
emission control system and require updating to 1977.
Discussions with REECO, Inc., Morris Plains, N.J., and Bobst-
Champlain, Roseland, N.J.
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 and
secondary heat recovery; 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.
6,400 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 $6.4 million
to $7.8 million, with equivalent annualized costs of $1.6
million to $2.3 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.
This estimate is highly dependent on the ability of the
plants affected to reduce air flow rates sufficiently to attain
an organic content of 25 percent of the lower explosion limit
(LEL) and on the ease of retrofit of add-on control devices.
In many older plants, installation of a control device will be
overly difficult and expensive. For example, at one Wisconsin
paper coating plant, personnel have estimated the installed cost
of incinerator systems to range from $2.8 million to $5.6
million. The costs depend primarily on reducing air flows
in their coating operations. They have, however, encountered
problems with product quality when air flows are reduced
to achieve a 25 percent of LEL in drying ovens.
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 5,200 tons per year.
This is based on a 90 percent capture of emissions by a carbon
adsorber or destruction in an incinerator, for 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,
unit price (assuming full cost pass-through), state economic
variables and capital investment.
5.5.1 RACT Timing
Current proposed guidelines for paper coating suggest
several compliance deadlines for alternative methods of com-
pliance. 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 ad-
sorption 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 econom-
ically sound method of control.
Only a small number of companies manufacture
incineration systems with proven high heat
recovery. The cumulative effect of equip-
ment 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 Categories of Stationary Sources,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 re-
search, 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 sys-
tems 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. Incin-
eration 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 the annualized costs to coaters
in the state is estimated at $1.6 million to $2.3 million.
These costs are approximately 0.3 percent to 0.5 percent of
total shipments of coaters expected to be affected by RACT.
In a recent report^ for a model plant, incineration with
primary heat exchange was shown to add only about 2 percent
to annualized costs.
Springborn Laboratories, Inc., op. cit.
5-24
-------
The major economic impact to individual companies will be
the large capital expenditures required for add-on devices rather
than increased annualized costs. For most companies, compliance
requirements for add-on systems, which appear to be the only
practical method of meeting proposed guidelines, may far exceed
their normal level of capital expenditures for plant improvement
and expansion.
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 structure 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 additional operating costs
for control are expected to have small effect on sales price.
No significant effect on overall productivity is foreseen
except for the small change due to 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
-------
EXHIBIT 5-13
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR PAPER COATERS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected facilities
Indication of relative importance of
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
Ten plants have been identified from the
emission inventory. However, if this
category is interpreted to include all
types of paper coating, including pub-
lishing, far more firms would be affected
The 1977 value of shipments of the ten
plants identified is estimated to be
approximately $420 million. These plants
are estimated to employ approximately
5,600 people
Gravure coating replacing older systems
Approximately 6,400 tons per year were
identified from the emission inventory.
Actual emissions are expected to be higher
Though low solvent coating use is increas-
ing 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 $6.4 million to $7.8
million depending on retrofit situations.
This will be more than 100 percent of
normal capital expenditures for the
affected paper coaters
$1.6 million to $2.3 million annually.
This represents approximately 0.3 to
0.5 percent of the 1977 annual sales for
the affected paper coaters
Assuming a "direct cost pass-through"—
0.3 percent to 0.5 percent
Assuming 70 percent heat recovery, energy
requirements are expected to increase by
approximately 30,000 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 more than
$1 million for a carbon adsorber
RACT guideline needs clear definition for
rule making
Equipment deliveries and installation of
incineration systems prior to 1982 are
expected to present problems
Retrofit situations and installation costs
are highly variable
Type and cost of control depend on particu-
lar solvent systems used and reduction in
air flow
-------
EXHIBIT 5-13(2)
U.S. Environmental Protection Agency
Affected Areas in Meeting RACT
VOC emissions after control
Discussion
1,200 tons/year (19 percent of 1977
VOC emission level)
Cost effectiveness of control
$300 - $450 annualized cost/annual ton
of VOC reduction
Note: Cost data are based on emission information supplied by the Wisconsin Department
of Natural Resources
Source: Booz, Allen & Hamilton Inc.
-------
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 Wisconsin
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, 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 conversation 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.
Engineering Coated Products, Inc.
Joanna Western Mills
Ludlow corp.
Meyercord
Nabisco
Nashua
Standard Packaging
Weber Marking Systems
Weber Valentine Co.
Weldon Industries
Cadillac Products
C&S Carton, Incorporated
Muskegon Paper Box Company
Packaging Corp. of America
Packaging Corp. of America
Packaging Corp. of America
Potlatch Forrest, Incorporated
Continental Can Company
Greif Brothers Corporation
Union Camp Corporation
.Consolidated Packaging Corp.
Armak Company
Label Technique, Incorporated
Simplex Industries
Quality Park Products
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
Warren, MI
Marshall, MI
Muskegon, MI
Portage, MI
Grand Rapids, MI
Grandville, MI
St. Joseph, MI
Three Rivers, MI
Wyondotte, MI
Monroe, MI
Monroe, MI
Marysville, MI
Sturgis, MI
Constantine, MI
Birmingham, MI
-------
Private conversation with: (continued)
Graphic Controls Corporation Alpena, MI
Proctor & Gamble Paper Products Cheboygan, MI
Akrosil Corp. Menasha, WI
American Can Co. Neenah, WI
American Can Co. Menasha, WI
American Can Co. Wausau, WI
Central Paper Co. Menasha, WI
Milprint Inc. Milwaukee, WI
NCR Appleton Papers Appleton, WI
Shade Information Systems DePere, WI
Thilmany Pulp and Paper Kaukauna, WI
W.H. Brody Milwaukee, WI
Fox River Paper Company Appleton, WI
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6.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
FABRICS IN THE STATE OF WISCONSIN
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6.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR PLANTS SURFACE COATING
FABRICS IN THE STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact of
implementing RACT for plants in the State of Wisconsin 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 and add-on control equip-
ment 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 who
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
Manufactures, 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 a review of
industry directories:
Davidson's Textile Blue Book
Rubber Red Book
Modern Plastic Encyclopedia
Thomas Register of American Manufacturers
Wisconsin Directory of Manufacturers
Membership list of the Canvas Products Association.
In addition, the Wisconsin Department of Natural Resources
1977 emission inventory was scanned for firms listed in each
of the SIC groupings tabulated above. A telephone survey was
then made to verify the activities of candidate firms which
would be affected by this RACT category. Only three companies
could be found which coat either fabric or vinyl coated mate-
rials, by the methods specified in the proposed regulations,
and are expected to be affected by the regulations. Though
there may be other unidentified plants in the state which
coat fabrics as defined under the RACT category, they are
expected to be few in number with minimal emissions.
6.1.2 VOC Emissions
The Wisconsin Department of Natural Resources emission
inventory was used as a basis for the estimation of the total
VOC emissions from the fabric coating plants identified. The
emission rates were confirmed in interviews by the study team
with the firms concerned and thus are believed to be valid. They
are expected to represent 90 percent or more of the emissions
in this RACT category.
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. The two firms expected
to be affected by the regulation in Wisconsin indicated in '
interviews that add-on was the only reasonably available
emission control technology applicable to their coating
processes at this time. Waterborne or low solvent coatings
are either currently unavailable for their product lines or
of limited applicability.
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 Wisconsin Department of
Natural Resources inventory.
This independent estimate used design and cost information
provided by incinerator manufacturers or available in the
published literature and in the following EPA reports:
Control of Volatile Organic Emissions from Existing
Stationary Sources, Volume I (EPA-450/2-76-0281
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. This collection efficiency, combined with incin-
eration that reduces collected VOC emissions 90 percent,
results in a total reduction of 81 percent.
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 structure, employment
and productivity as a result of implementing RACT controls in
Wisconsin. Since three 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 Wisconsin. 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 Agencr
DATA QUALITY—SURF ACE COATING OF FABR!
Study Outputs
Hard Data
B C
Extrapolated Estimate!
Data Data
Industry statistics
X
Emissions3
Cost of emissions control
X
Economic impact
X
Overall quality of data
X
a. Emission data supplied by Wisconsin Department of
Natural Resources, 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
effects 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 249 plants in SIC categories in
which plants coating fabrics in Wisconsin 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, other published information
and telephone interviews, only three plants were found in which
fabric coating, as defined in the proposed "fabric coating"
regulation, is being used. Statistics concerning these three
plants are summarized in Exhibit 6-3, following Exhibit 6-2.
As shown, the three firms are estimated to employ a
total of about 500 people. They are estimated to have an
annual value of shipments of about $40 million collectively.
Individual estimated annual value of shipments are not tabu-
lated to protect proprietary information.
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
more than 0.1 percent of the total value shipments by
manufacturing plants and employ about 0.08 percent of
manufacturing workers in Wisconsin.
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 $301 million for all coated fabrics
Pyroxylin (cellulose nitrate) coatings,
6-6
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EXHIBIT 6-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR PLANTS IN SIC CATEGORIES
WHERE FABRIC COATING MAY BE USED IN WISCONSIN
SIC Name
2211 Broad woven fabric mills, cotton
2221 Broad woven fabric mills, man-made and silk
2241 Narrow fabrics and other, small wares mills
2258 Warp knit fabric mills
2261 Finishers of broad woven fabrics of cotton
2262 Finishers of broad woven fabrics of man-
made fiber and silk
2269 Finishers of textiles, n.e.c.
2295 Coated fabrics, not rubberized
2297 Nonwoven fabrics
3069 Fabricated rubber products, n.e.c.
3079 Miscellaneous plastics products
3291 Abrasive products
3293 Gaskets, packing, sealing devices
Number of
Firms
b
2
b
b
b
b
b
5
3
25
194
10
10
249
Number of
Employees
170
350
170
1,266
10,983
1,700
555
15,194
Annual
Payroll
($ thousand)
a
a
13,475
115,068
a
5,925
134,468
a. Not reported to protect proprietary information.
b. None listed
Source; 1976 County Business Patterns, U.S. Department of Commerce.
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EXHIBIT 6-3
U.S. Environmental Protection Agency
FIRMS EXPECTED TO BE AFFECTED BY THE
FABRIC COATING RACT REGULATIONS IN
WISCONSIN
Firm
Uniroyal Inc.
Estimated Annual
Location Value of Shipments
($ million)
Stoughton a
Employees
280
Estimated
Emissions Activity
(tons/year)
604
Vinyl coating
Kimberly-Clark Corp.
Appleton
116
145
Nonwoven fabric
coating
Rainfair Inc.
Racine
$40
1001
496
320
1,069
Fabric and vinyl
coating
a. Not indicated to protect proprietary information.
b. Estimated
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 6-4
U.S. Environmental Protection Agency
U.S. ANNUAL VALUE OF SHIPMENTS OF COATED FABRICS
($ 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
154.1
26.3
67.9
27.3
693.7
188.0
29.4^
73. 6b
34.5
728.7
212.6
(13.6)a
83. 5b
28.0
681.5
202.7
(1.4)a
72. Ob
32.5
817.4
213.8
(33.8
80.0
876.5 1,011.9 1,156.5
985.6 1,177.5
Notes:
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
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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
Coated and Protective Fabrics'3
133.7
149.3
167.5
137.8
177.6
TOTAL
229.1
250.2
232.2
203.1
259.1
Notes:
a,
b.
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, Technicon, November 1977
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because of their low cost and ease of application,
continue to occupy a steady though proportionately
smaller share of the market. Natural and artifical rubber
coated fabrics, because of unique properties not obtainable
with plastic materials, also maintain a substantial (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 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; balloons; 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
emzssions from this operation.
6-8
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EXHIBIT 6-6
U.S. Environmental Protection Agency
TYPICAL FABRIC COATING OPERATION
RUBBER
PIGMENTS
CURING AGENTS
SOLVENT
I
MILLING
MIXING
DRYING AND
CURING
COATING
APPLICATION
FABRIC
COATED PRODUCT
Source; Control of Volatile Organic Emissions from Existing
Stationary Sources, Volume II (EPA-450/2-76-028)
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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 sol-
vent
Cleaning coating lines with solvent
Evaporation of solvent from the coated fabric
after it leaves the coating line. From 2 percent
to 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 solventborne
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
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
4 SUBSTRATE
COATING
SUBSTRATE
HARD RUBBER OR STEEL ROLI ER
Source; Control of Volatile Organic Emissions from Existing
Stationary Sources, Volume II (EPA-450/2-76-028)
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EXHIBIT 6-8
U.S. Environmental Protection Agency
ROLLER COATING OF FABRIC
COATED FABRIC
SUBSTRATE
Source; Control of Volatile Organic Emissions from Existing
Stationary Sources, Volume II (EPA-450/2-76-028)
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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, three fabric or vinyl coaters have
been identified in Wisconsin. The total VOC emission from
coating lines is estimated to be 1,069 tons for these plants
with the majority of this, about 600 pounds per year, originating
at the Uniroyal, Inc. vinyl coating plant in Stoughton. These
emissions are reported to be primarily methyl ethylketone.
No controls are now used by any of the three plants.
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.
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 percent to 100 per-
cent, through the 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
content 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.
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 1,20QOF 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 of more of their lower explosion limit
(LEL).
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
-------
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, three major coaters
were identified.
6.5.1 Costs of Alternative Control Systems
Exhibits 6-9 and 6-10, following the next page, summarize
costs for typical incineration systems using primary heat and
secondary heat exchange. These curves and other cost informa-
tion obtained from Control of Volatile Organic Emissions from
Existing Stationary Sources, Volume I (EPA-450/2-76-028) were
used, as discussed in the next section, to estimate compliance
costs for the three firms believed to be affected. It is
assumed that current exhaust flow rates can be reduced suf-
ficiently to attain 25 percent of LEL. This is possible with
well-designed capture systems in most cases, as discussed in
previous EPA guideline reports, such as Control of Volatile
Organic Emissions from Existing Stationary Sources Volume II
(EPA-450/2-77-008).Exceptions may occur where product drying
times or other coating characteristics may not permit such
operation. However, this assumption and the use of secondary
heat recovery appear to be achievable for the three firms
considered to be affected.
A representative of one of the firms believed that they
could replace a portion of their coating materials with water-
borne materials and thereby achieve current RACT on a plant-
wide basis. In lieu of this, they would use incineration.
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 Exhibits 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
T.A. Kittleman and A.B. Akell, "The Cost of Controlling Organic
Emissions," Chemical Engineering -Progress, April 1978.
6-17
-------
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 incin-
erator.
6.5.2 Estimated Compliance Costs
As discussed above, emissions considered to be appli-
cable under RACT for fabric coating are 1,069 tons per
year. Based on the EPA cost data presented in Exhibit 6-9
and 6-10, the minimum capital costs for compliance are
estimated to be about $680,000. This assumes that retrofit
will involve minimal difficulty, that air flow can be reduced
sufficiently to allow oven operation at 25 LEL and that direct
fired incinerators would be used. Other assumptions used
in this estimate are summarized in Exhibit 6-11, following
Exhibit 6-10.
However, because of the anticipated retrofit factors
(such as the additional costs for enclosing coating ovens,
requirements for temporary removal or shutdown of equipment,
roof mounting of the incinerators, addition of new fuel supply
systems), the total capital cost will be about three to four
times this or about $2.45 million to $3.08 million and will
be distributed about as shown in Exhibit 6-12, following
Exhibit 6-11.
Uniroyal personnel have estimated total capital to meet
the proposed regulation at $2.7 million. Based on this
estimate, total statewide expenditures would be about $3.5
million to $4.0 million. Both cost estimates are subject to
the basic assumptions used, the most critical being the level
of LEL which can be achieved and the period over which emissions
occur; both determine the operating air flow rates which are
the major determinant of cost.
Annualized costs are estimated by the study team
to be about $600,000 for the three firms, as shown in Exhibit
6-12. Uniroyal has estimated about $500,000 for its Stoughton
plant. The estimate of operating costs is very sensitive to
the estimated capital costs and the degree of heat recovery
which can be achieved. Normally, capital charges for
depreciation, taxes, adminstrative costs, maintenance and
interest would be about 25 percent of capital; in this
case, minimum capital charges would be $0.6 million to
$0.75 million. However, this and other operating costs
are offset by fuel savings from the combustion of the
VOC emissions.
6-18
-------
EXHIBIT 6-9
U.S. Environmental Protection Agency
CAPITAL COST FOR DIRECT FLAME AND CATALYTIC
INCINERATORS WITH PRIMARY AND SECONDARY
HEAT EXCHANGE
o
LJ
_J
<
£
oZ
120
80
10
15 20 25 30
PROCESS FLOW. 10* jclm (APPROXIMATE)
35
40
45
-------
EXHIBIT 6-10
U.S. Environmental Protection Agency
ANNUAL COST OF DIRECT FLAME INCINERATORS
(Primary and secondary heat recovery)
in
o
CJ
700
600
500
400
< 300
200
100
10
20 30
FLOW, vcfmx 1fl
40
SO
—!^: ~ORtro1 QfJl?1?^1! 9rganic Emissions from Existing Stationary
-------
EXHIBIT 6-11
U.S. Environmental Protection Agency
SUMMARY OF ASSUMPTIONS USED IN COST ESTIMATE
Assumptions
90 percent of emissions are controlled by incineration with primary and
secondary heat recovery; 90 percent of solvent emissions from the coating
line are collected. Total reduction is 81 percent.
25 percent LEL is equal to 3,000 ppm of methyl ethylketone by volume.
Air flow can be reduced to reach 25 percent LEL
Emission rate is constant over a period of 5,840 hours per year.
A total of six incinerators, with about 2,000 SCFM capacity, are used.
Other assumptions regarding incinerator prices and operating parameters, as estimated
in Control of Volatile Organic Emissions from Existing Stationary Sources, Vol. I:
Control Methods for Surface-Coating Operations, EPA-450/2-76-028, are valid.
Source; Booz, Allen & Hamilton Inc.
-------
EXHIBIT 6-12
U.S. Environmental Protection Agency
ESTIMATED COSTS OF COMPLIANCE
FOR THREE PLANTS IDENTIFIED
($ millions)
Plant
Uniroyal, Inc.
Estimated
Capital Costs for Direct
Fired Incineration
1.4-1.76
Estimated
Annualized
Costs
0.3
Kimberly-Clark Company
0.35-0.44
0.1
Rainfair, Inc.
0.70-0.88
2.45-3.08
0.2
0.6
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
several 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 Co
^mi!S1°nS fr°m 15 Categ°ries of Stationary Sources.
£— to — UUi. ——
6-19
-------
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 need to be extended.
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 usable 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 confi-
dence since operating 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 $600,000 as presented in Exhibit
6-12, and the estimated value of shipments of the two
firms, annual compliance costs would be about 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 rub-
berized fabric.
•'-Springborn Laboratories, Inc., op.cit.
6-20
-------
The major economic impact in terms of cost to indi-
vidual companies will probably be capital related rather
than from increased annualized costs. The capital re-
quired for RACT compliance will present a significant
amount of capital appropriations for the three companies
affected. Compliance requirements for add-on systems, which
appear to be the only practical method of meeting proposed
guidelines, would equal or exceed their normal levels of
capital expenditure for plant improvement and expansion.
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 the plants identified to be included in the
fabric coating category employ a total of about 500 workers.
Though compliance may affect the financial performance of the
plants, none are expected to shut down operations totally.
They may, however, terminate certain unprofitable and uncompetitive
product lines which could slightly affect employment.
If add-on control devices are installed, a few operation
and maintenance personnel may be added at both plants.
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.
Exhibit 6-13, on the following page, summarizes the
conclusions and projected implications of the results from
this study.
6-21
-------
EXHIBIT 6-13
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR FABRIC COATERS
IN THE STATE OF WISCONSIN
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
Three firms were identified as being affected
by the proposed regulation
Total value of shipments by the three plants
identified is about $40 million. These plants
employ about 500 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 1,070
tons/year
Direct fired incineration for short range,
low solvent coatings are a long-range goal
Direct fired 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
VOC emissions after RACT control
Cost effectiveness of RACT control
Discussion
Study team estimate is about $2.5 million to
$3.0 million. Companies affected estimate
costs to be as much as $3.5 million to $4
million
Approximately $0.6 million, which represents
about 1.5 percent of these 1977 value of
shipments
Assuming a "direct pass-through of costs,"
prices of coated fabrics will increase by aboul
1.5 percent
Assuming 70 percent heat recovery, about 5,000
equivalent barrels of additional fuel oil woul<
be required per year
No major impact
No 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 maki
the plants uncompetitive with more modern and
efficient ones
Capital and operating costs can only be approx,
mated because of unknown retrofit situations
210 tons/year (20 percent of 1977 VOC emission,
$700 annualized cost/annual ton of VOC reductii
Note: Cost data are based on emission information supplied by the Wisconsin Department
of Natural Resources.
Source: Booz, Allen & Hamilton Inc.
-------
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 Wisconsin 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
Ford Motor Company, Dearborn, Michigan
St. Clair Rubber Company, Marysville, Michigan
Rospatch Label Company, Rospatch, Michigan
Cadillac Rubber and Plastics, Cadillac, Michigan
Textile Industries, Detroit, Michigan
Flexoid, Hazel Park, Michigan
Wayne Gasket, Mt. Clemens, Michigan
Uniroyal Inc., Stoughton, Wisconsin
Kimberly Clark Corp., Appleton, Wisconsin
Rainfair Inc., Racine, Wisconsin
-------
7.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF AUTOMOBILES
IN THE STATE OF WISCONSIN
-------
7.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF AUTOMOBILES
IN THE STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT for surface coating of automobiles in the
State of Wisconsin.
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 submissions to public hearing and analysis.
7-1
-------
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 Wisconsin.
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.
Because there were only two major companies in the state, these
companies were both interviewed.
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 in the 1976 Wisconsin Point Source
Emissions Inventory and industry interviews. It was found
that the emission inventory understated the emissions from
automobile assembly plants and these are adjusted accordingly
in this chapter.
7.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions for the surface
coating of large appliances are described in Control of Volatile
Organic Emissions from Existing Stationary Sources—Volume II
(EPA-450/2-77-008, May 1977). Both manufacturers were inter-
viewed to ascertain the most feasible types of control for
organic emissions in the coating of automobiles.
7-2
-------
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
-------
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
Wisconsin.
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 Wisconsin.
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
-------
EXHIBIT 7-1
U.S. Environmental Protection Agency
SURFACE COATING OF AUTOMOBILES
DATA QUALITY
Study Outputs
Hard Data
B
Extrapolated
Data
Estimated
Data
Industry statistics
X
Emissions
X
Cost of emissions control
X
Economic impact
X
Overall quality of data
X
Source: Booz, Allen & Hamilton Inc.
-------
7.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business trends
for automobile assembly plants in Wisconsin are presented in this
section. Data in this section form the basis for assessing
the impact of implementing RACT for control of VOC emissions
from automobile manufacturing plants in the state.
7.2.1 Size of the Industry
There are three major automobile manufacturing facilities
that would be affected by the RACT guidelines in Wisconsin.
General Motors has an assembly plant in Janesville and American
Motors has two assembly plants in Kenosha. Exhibit 7-2, on the
following page, presents the potentially affected facilities and
the approximate number of automobiles and light duty trucks
manufactured in the state.
In 1977, there were approximately 520,000 automobiles
manufactured in Wisconsin, approximately 6.4 percent of the
automobiles manufactured in the U.S. There are six states that
currently manufacture more automobiles than Wisconsin, but
only three (Michigan, Missouri and Ohio) with appreciably
more automobile production. The table below presents the
percent of U.S. car production by state for the 1976 model year.
State Percent of U.S. total automobile production
Michigan 33.9
Missouri 9.2
Ohio 8.7
New Jersey 6.8
California 6.7
Georgia 6.6
Wisconsin 6.4
Other states 21.7
Additionally, there were approximately 110,000 light duty
trucks manufactured at the General Motors plant in Janesville.
The 1977 value of shipments of automobile and light duty trucks
in Wisconsin is estimated to be $3.5 billion. These manufacturing
facilities employ approximately 15,000 employees. The capital
expenditures for these three plants are not available; however,
historically, the auto industry's nationwide expenditures for new
plant and new equipment are 1 percent to 2 percent of the value
of shipments.
7-5
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EXHIBIT 7-2
U.S. Environmental Protection Agency
LIST OF FACILITIES POTENTIALLY AFFECTED
BY THE RACT GUIDELINE FOR SURFACE
COATING OF AUTOMOBILES - WISCONSIN
Company or Division
General Motors: GM
Assembly
Location
Janesville
Make and Type of Vehicle
Manufactures
Chevrolet
Chevrolet, CMC - Commercial
Vehicle
Automobile Production
for the 1976 Model Year
236,000
Truck Production
for 1976 Model Year
112,000
American Motors
Kenosha (Main Concord, Matador, Pacer and
Plant and Lakefront Gremlin
Plant)
284,000
None
Total, Wisconsin (approximately 6.4 percent of U.S.
total automobile production)
519,000
112,000
Source; Plants of U.S. Motor Vehicle Manufacturers, 1978, Motor
Vehicle Manufacturers Association of the United States, Inc.
-------
7.2.2 Comparison of the Industry to the State Economy
The Wisconsin automobile and light duty truck assembly industry
employs 3 percent of the state labor force, excluding government
employees. The value of shipments from automobile assembly
plants represents approximately 10 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 invested extensive capital 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
cathodic electrodeposition because of the increased coverage,
uniformity and paint recovery. Some of the anodic electrode-
position 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. utilize spray, dip or flow coating.
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 desposited 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 facilities
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 C6.5 pounds of organic solvent
per gallon of coating) and the waterborne had
2.8 pounds of organic solvent per gallon of coating
(as do GM 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
utilization 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,
Massachusetts, and Metuchen, New Jersey. Along
with process color change and other difficulties
that are potentially 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
coatings 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 exposure
to isocyanates from the coatings. Exposure would
have to be minimized to assure worker safety.
High solids (35-55 percent by volume solids) dis-
persion lacquers—Many suppliers have taken an
intermediate 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 additional 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 (1 to 2 years) some higher solids
colors may be available for use, however it is un-
likely 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 Wisconsin and the current
level of emission controls in the state. Exhibit 7-4, on
the following page, shows the estimated emissions in 1977
from the two major companies. A recently shut down American
Motors plant in Milwaukee was excluded from this analysis,
since it is not expected to be reopened.
The General Motors facility at Janesville manufacturers
both automobiles and light duty trucks. The total VOC
emissions from this facility are approximately 8,000
tons per year.
Prime coat application is planned to be
converted to cathodic electrodeposition
by the end of 1978.
Automobile topcoat is a solution acrylic lacquer
at approximately 13 percent solids.
Light duty trunk topcoat is an enamel at
approximately 28 to 32 percent solids.
Automobile final repair coatings are a solution
lacquer at approximately 13 percent solids.
Light duty truck final repair is an enamel
at approximately 28 to 32 percent solids.
American Motors has two assembly facilities in
Kenosha, Wisconsin (Main Plant and Lakefront Plant).
In terms of surface coating processing, both plants
have similiar types of coating operations. The VOC
emissions from these two facilities are approximately
3,260 tons per year.
There are two different primer coats applied
to the auto bodies:
An epoxy dip primer at 38 percent solids
A reinforcement spray primer at 30 percent
solids
The topcoat is an enamel system at 30 percent
solids (+5 percent). The light metallic colors
have a lower solids content.
7-10
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EXHIBIT 7-4
U.S. ENVIRONMENTAL PROTECTION AGENCY
WISCONSIN EMISSIONS — SURFACE
COATING OF AUTOMOBILES
Wisconsin
File
Number
540004
300008
300007
Company Name, Location
GM Assembly Division
1000 Industry Ave.
Janesville, WI 53545
American Motors Corp.
Lakefront Plant
57th Street & 4th Avenue
Kenosha, WI 53140
American Motors Corp.
Main Plant
5626 25th Avenue
Kenosha, WI 53140
Process Description
Automobiles—solvent-based primers
and solution laquer topcoats
Light duty trucks—solvent-based
primers and enamel topcoats
Dip and spray primer system
and enamel topcoat
Dip and spray primer and
enamel topcoat
1977
VOC
Emissions
(tons per year)
6,850
1,130
1,680
1,580
Total, Wisconsin 1977
11,240
Source; Wisconsin Department of Natural Resources
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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. They do 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.
7-11
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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.
7-12
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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 7-5 and 7-6, on the following pages, present the
selection of the most likely RACT alternatives under the two
scenarios.
7-13
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EXHIBIT 7-5
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 water-borne or high
solids "surfacer"
Topcoat
Spray, dip or flow coat
primers with incinera-
tion
Water-borne 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 corrosion
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 7-6(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 corrosic
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 "surfacei
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 7-6 (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 7-6(3)
U.S. Environmental Protection Agency
Processing Control
Area Alternatives Discussion
Current or modified coat- High operating cost foi
ings with incineration energy demands
Source: Booz, Allen & Hamilton Inc.
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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,
7-14
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Direct operating costs (utilities, direct labor
and raw materials) would be approximately $20,000
less annually than for conventional application
techniques.
Interest, depreciation, taxes and insurance are
estimated to be $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.l
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.
7-15
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The annualized cost of the conversion to
a waterborne system would be approximately
$8 million.
The additonal energy demands are estimated
to be equivalent to approximately 38,000
equivalent barrels of oil annually.
The resulting VOC emission from a waterborne 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 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 based on the following control alternatives:
Cathodic or anodic electrodeposition of
primers
High solids enamels, urethane enamels, or
powder coatings technologies developed for
topcoat application
35 percent solids enamel 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. Therefore,
costs were estimated for manufacturers currently using
enamels and lacquers.
For manufacturers that are currently using
enamel topcoating, this analysis assumes
that they would meet the RACT requirements
with high solids enamel technology develop-
ments .
7-16
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- Under this scenario, minimal changes in
capital and operating costs 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 achievable, based on
projected technology developments
that are currently being applied by
other industrial sectors.
For manufacturers that are currently using lacquer
topcoat systems, there is likely to be significant
capital requirement to meet further technology
development:
A conversion to high solids enamel is
likely to require changes in equipment,
such as:
Conveyor systems
Ovens
In-house repair
Spray systems
Sludge disposal system.
The conversion requirements for urethane
enamels or powder coatings is at too
early a stage to estimate costs.
The equipment modifications would depend
on the particular technology adapted at
these facilities and the available equip-
ment. Based on Booz, Allen study team
estimates, the anticipated capital
costs are likely to be less than $10
million per facility. Therefore, for
purposes of this study, a judgmental
analysis leads to the following cost
determination to convert current lacquer
processing:
Capital cost of $10 million
Annualized cost of $1.5 million
(based on capital related annualized
costs of 15 percent of capital cost).
7-17
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Exhibit 7-7, on the following page, presents the conversion
costs for the two scenarios developed.
7.4.3 Extrapolation to the Statewide Industry
Exhibit 7-8, following Exhibit 7-7, presents the extra-
polated costs of meeting the RACT guidelines under two scenarios
that were developed. These costs are based upon:
The estimates of cost of compliance under
the control alternatives in the two scenarios
that were presented in sections 7.4.1 and 7.4.2.
The processing techniques at the three
potentially affected facilities in the state:
The two American Motors facilities
utilize enamel topcoat systems.
The General Motors facility has a
cathodic electrodeposition system
(planned to be operational by the
end of 1978). The automobile assembly
line has a lacquer topcoat system and
the light duty truck assembly line has
an enamel topcoat system.
Application of the model plant costs developed
under each scenario to each specific facility
affected in the state and aggregating the results.
7-18
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EXHIBIT 7-7
U.S. Environmental Protection Agency
ESTIMATED COST FOR MODEL PLANT TO
MEET AUTOMOBILE RACT REQUIREMENTS
SCENARIO I
Primer
Topcoat
Final Repair
Total,
Scenario I
Capital Cost
($ 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 <1-<10
Facilities/
Laquer
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 7-8
U.S. Environmental Protection Agency
STATEWIDE COSTS TO MEET THE RACT GUIDELINES
FOR AUTOMOBILE ASSEMBLY PLANTS
Characteristic
Number of plants3
1977 VOC emissions
(tons per year)
Scenario I
3
11,240
Scenario II
3
11,240
Potential emission
reduction
(tons per year)
9,740
8,540-9,740b
VOC emissions after
RACT
(tons per year)
1,500
1,500-2,700
Capital cost
($ millions, 1977)
150
35
Annualized cost
($ millions, 1977)
25
Annualized cost per
ton of emission reduction
2,570
530-610
a. There are two production lines at the Janesville plant
(automobiles and light duty trucks).
b. 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.
3.5.1 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 three 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 American Motors, which has two
older facilities in Kenosha, 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 all three affected
facilities in Wisconsin.
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 Wisconsin 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 the General Motors automotive line,
which utilizes lacquers, this represents
a significant change in technology.
Spot repair procedures and possibly
conveyor systems would have to be
modified for implementation.
At American Motors and at the General
Motors' light duty truck line, which uti-
lize 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
higher solids enamel repairs).
Under Scenario II, it is assumed that the RACT requirements
are modified to meet specific technologies. The only major pro-
cessing area where significant modifications need to be adapted
would be for topcoating.
It is likely that higher solids enamels tech-
nologies will be developed over the next two
or three years, although it is highly unlikely
a 62 percent solids enamel could be developed
before 1980.
Topcoat changes at the General Motors automotive
line 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 for 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 the low solvent
coatings—primarily waterborne.
It is probable that the final repair limitations
could be achieved (with moderate technology advances)
at the automobile facilities currently using enamel
systems. The final repair modifications required
at General Motors would depend on the future topcoat
technology selected to meet RACT requirements.
7.5.3 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 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, water-
borne topcoat processes and a 35 percent solids enamel topcoat.
The capital requirement is estimated to be
$150 million, which represents approximately
300 percent of normal capital expenditures
(assuming current capital expenditures
represent 1.5 percent of value of shipments).
The net annualized cost increase is estimated
to be $25 million, which represents approxi-
mately 0.7 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 $40 per
vehicle manufactured.
The automobile manufacturing industry is a
significant part of the statewide economy
and the direct cost increase of compliance
represents approximately 0.1 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 technology developments:
The capital requirement is estimated to
be approximately $35 million, which
represents approximately 66 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 $5 million, which represents approximately
0.1 percent of the value of shipments.
Assuming a "direct cost pass-through", the price
increase would be approximately $8 per vehicle
manufactured.
The direct cost increase of compliance represents
approximately 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 manufacturing is a significant portion of
Wisconsin's manufacturing industry and Wisconsin ranks as the
seventh largest automobile manufacturing state in the nation.
However, a significant portion of this production is from
older facilities in the state.
If the recommended RACT limitations (Scenario I)
require waterborne coating technology, the
effect would probably be a total remodeling
of existing lines and facilities. For American
Motors, this could lead to the replacement of
the two existing facilities with one high
speed automated line. This might represent
a significant effect on the employment at these
facilities. Also, productivity is likely
to increase.
If the RACT limitations are modified to
developing technologies, no significant effect
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 is 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 7-9 and 7-10, 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 Wisconsin.
7-23
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EXHIBIT 7-9 (1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO I FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF WISCONSIN
SCENARIO I
(RACT Limitations
Implemented By 1982)
Current Situation
Number of potentially affected facilities
Indication of realtive 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
Discussion
Two companies operating three facilities
1977 value of shipments was approximately
$3.5 billion which represents approximately
10 percent of the states manufacturing
industry. Of all states, Wisconsin ranks
seventh in automobile production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
11,240 tons per year
Cathodic electrodeposition for prime
coat, manufacturers with enamel topcoat—
high solids enamel, manufacturers with
lacquer topcoat—unkown
Cathodic electrodeposition for prime coat
Waterborne enamels for topcoat
High solids enamels for final repair
Affected Areas in Meeting RACT
Scenario I
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity and employment
Market structure
Discussion
$150 million (approximately 300 percent
of current annual capital expenditures
for the industry in the state)
$25 million (approximately 0.7 percent of
the industry's 1977 statewide value of
shipments)
Assuming a "direct cost pass-through"
approximately $40 per vehicle manufactured
Increase of 124,000 equivalent barrels
of oil annually primarily for operation
of waterborne topcoating systems
Conversion to waterborne systems would
require total rework of existing processing
lines. Major modifications would probably
increase efficiency and line speed of
older units and possibly shutting down
one facility.
Accelerated technology conversion to
electrodeposition primer coat.
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EXHIBIT 7-9 (2)
U.S. Environmental Protection Agency
SCENARIO I
(RACT Limitations
Implemented By 1982}
Current Situation
RACT timing requirements (1982)
Problem areas
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
Nationwide conversion of all automobile
assembly plants to topcoating waterborne
systems cannot be achieved by 1982.
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 alter-
native. Final repair RACT limitations
area based on high solids enamel tech-
nology which is likely to require major
modifications for manufacturers using
lacquer systems
1,500 tons per year (13 percent of 1977
emission level)
$2,570 annualized cost/annual ton of
VOC reduction
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 7-10
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS
OF IMPLEMENTING RACT SCENARIO II FOR
AUTOMOBILE ASSEMBLY PLANTS IN THE
STATE OF WISCONSIN
SCENARIO II
(RACT Requirements Are Modified
To Meet Specific Technologies)
Current Situation
Number of potentially affected facilities
Indication of realtive 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
Market structure
RACT timing requirements
Problem area
VOC emission after RACT control
Cost effectiveness of RACT controls
Discussion
Two companies operating three facilities
1977 value of shipments was approximately
$3.5 billion which represents approximately
10 percent of the states manufacturing
industry. Of all states, Wisconsin ranks
seventh in automobile production
Prime coat—cathodic electrodeposition
topcoats—higher solids enamels for
manufacturers using enamel systems
11,240 tons per year
Cathodic electrodeposition for prime
coat, manufacturers with enamel topcoat—
high sales enamel, manufacturers with
lacquer topcoat—unknown
Cathodic electrodeposition for prime coat
High solids enamels, urethane enamels or
powder coating for topcoat
High solids enamel for final repair
Discussion
$35 million (approximately 66 percent
of current annual capital appropriations
for the industry in the state)
$5 million (approximately 0.1 percent of
the industry's 1977 statewide value of
shipments)
Assuming a "direct cost pass-through"
approximately $8 per vehicle manufactured
Dependent on technology applied
No major effect
No major effect—however. General Motors
is likely to have higher conversion costs
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,
depending on technology developments
Limitations for topcoat are dependent on
technology development
1,500-2,700 tons per year (13 percent to
24 percent of 1977 emission levels depen-
dent on limitations)
$530-$610 annualized cost/annual ton of
VOC reduction
Source: Booz, Allen & Hamilton Inc.
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8.0 ECONOMIC IMPACT OF IMPLEMENTING RACT
FOR THE SURFACE COATING OF METAL
FURNITURE IN THE STATE OF WISCONSIN
-------
8.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
SURFACE COATING OF METAL
FURNITURE IN THE STATE OF
WISCONSIN
This chapter presents a detailed economic analysis
of implementing RACT controls for surface coating of metal
furniture in the State of Wisconsin. 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
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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 Wisconsin.
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 Wisconsin point source emission inventory and sup-
plemented by a review of the 1976 County Business Patterns,
The Thomas Register and interviews with metal furniture
manufacturing corporations. The number of employees was
obtained from interviews with the metal furniture manufac-
turers. The value of shipments for three large firms was
obtained from industry interviews. The value of shipments
per employee for these firms was then used to estimate the
value of shipments for the remaining firms.
8.1.2 VOC Emissions
The VOC emissions were determined from an analysis of
the Wisconsin point source emissions inventory and inter-
views with the metal furniture manufacturers in Wisconsin.
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 Existing Stationary Sources/ EPA-
450/2-77-032.The data provide the alternatives available
for controlling VOC emissions from metal furniture manufac-
turing plants. Several studies of VOC emission control were
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
8-2
-------
manufacturing plants in Wisconsin. The specific studies
analyzed were Air Pollution Control Engineering and Cost
Study of General Surface Coating Industry, Second Interim
Report, Springborn Laboratories, and informational liter-
ature 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 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
8-3
-------
handling, 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 Wisconsin.
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 Wisconsin. 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, analy-
sis or 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.
8-4
-------
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.
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8.2 INDUSTRY STATISTICS
Industry characteristics, statistics and business
trends for metal furniture manufacturing plants in
Wisconsin 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, government
and private offices. Household metal furniture is manu-
factured primarily for home use and for some general
office use, such as for reception areas and lounges.
The metal furniture industry in Wisconsin manufactures
only business/institutional furniture. The industry is
highly competitive nationally, however, the manufacturers
in Wisconsin do not compete among themselves since each
manufacturer's product lines differ from those of the
others.
8.2.2 Size of the Industry
The Wisconsin point source emissions inventory and
Booz, Allen interviews have identified nine companies
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 $150 million
in business/institutional metal furniture shipments in
1977. This is equivalent to about 6.3 percent of the U.S.
value of shipments of business/institutional metal furniture.
The estimated number of employees in the metal furniture
industry in Wisconsin for 1977 was approximately 2,800.
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 0.44 percent of the
total Wisconsin value of shipments of all manufactured
goods. The industry employs 0.18 percent of all people
employed in manufacturing in Wisconsin.
1-5
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Exhibit 8-2
U.S. Environmental Protection Agency
LIST OF MANUFACTURERS WHO SURFACE COAT
METAL FURNITURE IN WISCONSIN
Facility Name
Hamilton Industries, Inc.
Invincible Metal Furniture Co.
Kreuger Metal Products, Inc.
Northwest Metal Products
Continental Inc.
Gerber Manufacturing Co.
Maysteel Corp.
Berlin Seating
Hough Manufacturing Corp.
Location
Two Rivers
Manitowoc
Green Bay
Green Bay
Columbia County
Madison
Marysville
Waupun
Janesville
Source: Booz, Allen & Hamilton Inc.
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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
Wisconsin.
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.
Most metal furniture is finished with a single coat
applied by spraying, dipping or flow coating. The
latter two techniques are generally used when manufac-
turers use only 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.
8-6
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Exhibit 8-3
U.S. Environmental Protection Agency
COMMON TECHNIQUES USED IN COATING OF METAL
FURNITURE PIECES
FROM
MACHINE SHOP
ELECTROSTATIC. OR
CONVENTIONAL AIR OR
AIRLESS SPRAY COATING
FLASHOFF
AREA
TO FINAL
ASSEMBLY
PRIME COAT. FLASHOFF AREA
AND OVEN
(OPTIONAL)
CLEANSING AND
PHETREATMENT
FLOW COATING
TOPCOAT OR SINGLE
COAT APPLICATION
Source: U.S. Environmental Protection Agency
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8.3.2 Emissions and Current Controls
This section presents the estimated VOC emissions
from metal furniture manufacturing facilities in VJisconsin
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 nine metal furniture
manufacturing facilities to be about 353 tons per year.
These data were based on the Wisconsin point source
emissions inventory and interviews with the manufacturers.
None of the manufacturers have installed complete
hydrocarbon control systems to comply with the RACT guide-
lines, although some progress has been made towards
controlling the hydrocarbon emissions. Invincible Metal
has converted to medium solid (50 percent to 60 percent
volume solid) paint; Hamilton Industries has converted
about 5 percent of their production to powder coating, and
is experimenting with waterborne coatings. Kreuger Metal
has also converted about 10 percent of their coating
operations to powder coatings.
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, following Exhibit 8-4. 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.
5-7
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Facility Name
Hamilton Industries, Inc.a
Invincible Metal Products, Inc.a
Kreuger Metal Products, Inc.
Northwest Metal Products0
Continental Inc.a
Gerber Manufacturing Co.a
May steel Corp.13
Berlin Seating Co.a
Hough Manufacturing Corp.a
EXHIBIT 8-4
U.S. Environmental Protection Agency
SUMMARY OF HYRDROCARBON EMISSIONS FROM
METAL FURNITURE MANUFACTURING FACILITIES
IN WISCONSIN
Type of
Coating
Process
spray
spray,
dip
spray
spray
spray
spray
spray
spray
spray
Number of
Coating
Lines
5
1
1
1
1
1
1
1
1
1
Current
VOC
Emissions
(ton/yr)
166
69
10
20
negligible
5
3
40
4
36
353
a. Based on Wisconsin point source emissions inventory.
b. Booz, Allen estimate, based on data supplied by the manufacturer.
c. Since no data were available, assumed negligible, based on the facility size.
Source
Booz, Allen & Hamilton Inc.
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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
90-95a
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
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
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
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
Control Options
Carbon adsorption
(continued)
Affected Facility
and Application
Typical Percent
Reduction
Incineration
Prime, single or
topcoat (ovens)
90
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
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
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 Existing Stationary Sources—Volume III; Surface
Coating of Metal Furniture, EPA-450/2-77-032, December 1977.
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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 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 the industry representatives indicate
that the eight affected manufacturers in Wisconsin will use
different control options: Two of the manufacturers will
modify the existing spraying equipment to handle water-
borne coatings; five of the manufacturers are expected to
modify existing spraying equipment to handle high solids
and the existing dip coating equipment to handle water-
borne coatings; and the remaining manufacturer with measure-
able hydrocarbon emissions is expected to convert to powder
coating operations.
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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. These costs are then extrapolated to the
statewide industry.
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 were changed to 30 percent
solids coating, conversion to higher solids (70 percent)
would not result in a savings. Similarly, capital costs
for conversion to waterborne coating would increase dra-
matically, if significant changes to the facility were
needed, compared to the assumption of cleaning and corro-
sion protection only of existing dip tanks.
8-9
-------
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
Incremental Costs for
Conversion
Base
Plant
Cost
Incremental Costs for
Conversion
25% Higher 25% Higher
Solids Solids Waterborne Powder Solids Solids Waterborne Powder
255
175
48
223
N/A
N/A
N/A
15
(6)
3
(3)
21
86
(143)
15
5
3
8
20
80
400
60 1,200 62
17 1,113 (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
80
197
317
343
59
402
380
97
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. Environmental 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 Wisconsin. The estimates
were derived based on the following:
The eight 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 powder coating line
was obtained from Kreuger Metal Products, Inc.
The annual capital charges were estimated to
be 18.7 percent of the capital cost, not in-
cluding maintenance costs.
Based on the data from the U.S. EPA, the incre-
mental annual operating cost was determined to
proportional to the amount of emissions reduc-
tion and was scaled up from the model plant
costs.
The data in Exhibit 8-9 show that the control of
VOC for surface coating of metal furniture to meet the
RACT guidelines in Wisconsin would require a statewide
8-10
-------
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
Number of plants
Number of process lines
Uncontrolled emissions (ton/yr)
Potential emission reduction (ton/yr)
Installed capital cost ($000) C
Direct annual operating cost (credit)
($000) (1-3 shifts/day)0
Annual capital charges (credit)
,($000)
Net annualized cost (credit) ($000)
Annualized cost (credit) per ton of
emission reduced ($)
High
Solids
Spray
5
5
154
132
96
(38)
18
(20)
(130)
Waterborne Waterborne
Spray Powder Dip Total
2 118
6 1 1 13
169 20 10 353
135 19 8 294
105 80 50 331
34 14 3 13
20 15 9 62
54 29 12 75
400 1,526 1,500 255
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,
and 97 percent for powder coating lines.
c. Based on cost for model plant A-l and B-l from Exhibits 8-7 and 8-8, and from data
provided by Krueger Metal for powder coating and Invincible for dip coating.
d. 18.7 percent of capital cost.
Source: ^ooz, Allen & Hamilton Inc.
-------
capital investment of about $331,000 and an annualized cost
of about $75,000. It_ should be noted that these findings
are based on the assumption that all metal furniture manu-
facturing plants will experience average costs or savings
similar to those experienced by the model plants. Some
plants in Wisconsin may require -substantial capital invest-
ment to modify the existing facilities to meet the RACT while
others will require less.
8-11
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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.
1-12
-------
Three metal furniture manufacturers in Wisconsin
interviewed during this study have attempted to implement
the control systems discussed in this report. One manu-
facturer of laboratory furniture has been experimenting
with waterborne coating for several years, but has not
been able to obtain satisfactory coating capable of with-
standing the corrosive laboratory environment. This
manufacturer intends to convert to waterborne coating;
however, unless a satisfactory waterborne coating for
corrosive environments is developed in time, this manu-
facturer will not be able to comply with the RACT guide-
lines by 1982. The other manufacturers do not foresee
any technical problem in complying with the RACT guide-
lines, but the capital investment of $50,000 to $80,000
required to comply with the RACT guidelines represents a
significant capital expenditure for them.
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 0.05
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 major economic impact in terms of cost to
individual companies will be capital related rather
than from increased annualized costs. The capital
required for RACT compliance may present a significant
capital appropriation problem for the two small com-
panies affected in the state. However, none of the
companies interviewed had considered going out of
business because of the projected increased capital
requirements.
5-13
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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.
The implementation of the RACT guidelines is not
expected to have a significant impact on the present
market structure or productivity.
Exhibit 8-10, on the following page, summarizes the
conclusions presented in this report.
8-14
-------
EXHIBIT 8-10
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SURFACE COATING OF
METAL FURNITURE IN WISCONSIN
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 control to meet
RACT guidelines
Discussion
There are nine metal furniture manufacturers
and coaters
1977 value of shipments was estimated at $150
million and represents 6.3 percent of the es-
timated U.S. value of shipments
353 tons per year
Low solvent coatings
Low solvent coatings
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
RACT timing requirement (1982)
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Dicsussion
$0.33 million
$75,000 which represents 0.05 percent of the
industry's 1977 value of shipments
Increase a few cents to over $I/unit depending
on the surface area coated (assuming a full cost
pass through)
No major impact
No major impact
No major impact
No major impact
Conversion to waterfaorne coating may pose a
problem for one company if suitable waterborne
coating material capable of withstanding cor-
rosive environment were not developed in time
Development of suitable waterborne coating
material for corrosive environment
59 tons/year (17 percent of 1977 emission level)
$1,125 capital cost/annual ton VOC reduction
$255 annualized cost/ton VOC reduction
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
U.S. Environmental Protection Agency, Control of Volatile
Organic Emissions from Existing 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 at the following:
Kreuger Metal Green Bay, WI
Hamilton Industries Two Rivers, WI
Invincible Metal Furniture Monitowoc, WI
Northwest Metal Products Green Bay, WI
Gersen Manufacturing Co. Madison, WI
Maysteel Corp. Mayville, WI
Berlin Seating Waupun, WI
Hough Manufacturing Corp. Janesville, WI
Lee Mfg. Co. Oak Creek, WI
Richardson Bros. Sheboygan Falls, WI
Svoboda Industry Kewunee, WI
Thill, Inc. Oshkosh, WI
Buckstaff Co. Oshkosh, WI
Decar Corp. Middleton, WI
Mayville Metal Products Mayville, WI
A. S. Pletsch Co. Milwaukee, WI
Stanwood Corp. Stanley, WI
-------
9.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE COATING
FOR INSULATION OF MAGNET WIRE IN
THE STATE OF WISCONSIN
-------
9.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT GUIDELINES FOR SURFACE COATING
FOR INSULATION OF MAGNET WIRE IN
THE STATE OF WISCONSIN
From the following data sources on facility identifica-
tion, emissions and value of shipments, the Booz, Allen study
team concludes that there are no facilities currently surface
coating magnet wire for insulation in the state of Wisconsin.
Thomas Register
Sales and Marketing Management, April 24, 1978
Wisconsin Point Source Emissions Inventory
1972 Census of Manufactures, Nonferrous
Metal Mills and Miscellaneous Primary
Metal Products
1976 Current Industrial Reports, Insulated
Wire and Cable, issued July, 1977
Annual Survey of Manufactures, 1976.
Therefore, based on the information available, no
facilities will be affected in the state of Wisconsin by
implementation of RACT guidelines for the magnet wire
industry.
-------
10.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF
WISCONSIN
-------
10.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT GUIDELINES
FOR SURFACE COATING OF LARGE
APPLIANCES IN THE STATE OF
WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT for surface coating of large appliances
in the State of Wisconsin. 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 Wisconsin.
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 seven 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 Reports provides detailed industry
statistical data for the major 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:
10-2
-------
A list of potentially affected facili-
ties was compiled from the state emission
inventory, associations and trade journals.
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 24, 1978)
1972 Census of Manufactures.
The Booz, Allen study team, utilizing all
available inputs, including interviews
with selected manufacturers, determined
an estimated 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
Booz, Allen developed a listing of seven facilities, identi-
fied as hydrocarbon emitters in the surface coating of large
appliances, covered by RACT in the state of Wisconsin. This
listing is based on information provided by the 1976 Wisconsin
Point Source Emission Inventory. The list, therefore, may not
be all inclusive, or it may include industries that may not be
actually performing the coating operations indicated or identified
by the RACT category. Sufficient data and resources were not
available to verify each listing.
10-3
-------
10.1.3 Processes for Controlling VOC Emissions
Processes for controlling VOC emissions 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.
All manufacturers interviewed agreed that, currently, con-
sideration was being given to meeting the present RACT deadlines
through one modification to the existing topcoating equipment
(i.e., high solids) and through two possible alternatives to
prime coating 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 alterna-
tives. 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
10-4
-------
Extrapolating model costs to individual industry
sectors
Aggregating costs to the total industry for the
state.
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
Wisconsin.
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
-------
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
X
Economic impact
X
Overall quality of data
X
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 Wisconsin 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
forms the basis for assessing the impact on this industry
of implementing RACT to VOC emissions in Wisconsin.
10.2.1 Size of the Industry
Information from the Wisconsin Point Source Emission Inven-
tory and Booz, Allen interviews have identified seven companies
participating in the manufacture and coating of large appliances,
as shown in Exhibit 10-2, on the following page. These companies
accounted for between $390 million to $865 million in shipments.
The estimated number of employees in 1977 was between 4,000
and 5,000. These data and the sources of information are
summarized in Exhibit 10-3, following Exhibit 10-2, and indicate
that Wisconsin shipped an estimated 2 percent to 6 percent of
the U.S. value of shipments.
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 between
1.0 percent and 2.7 percent of the total Wisconsin value of ship-
ments of all manufactured goods. The industry employs between
0.8 percent and 0.9 percent of all people employed in manufac-
turing in Wisconsin. 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 WISCONSIN
Facility Name
Insinkerator Div.
Emerson Electric
Location
Racine
Kelvinator Commercial Products
Malleable Iron Range Co.
McGraw Edison Co.
M-C Company
Trane Co.
United Refrigerator Co.
Manitowoc
Beaver Dam
Ripon
Manitowoc
LaCrosse
Hudson
Source: Wisconsin Point Source Emission Inventory and Booz
Allen & Hamilton Inc. analysis
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EXHIBIT 10-3
U.S. Environmental Protection Agency
INDUSTRY STATISTICS—SURFACE COATING OF
LARGE APPLIANCES IN THE STATE OF WISCONSIN
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. Totals3
1977
Estimated
No. of Units
Shipped
(Thousand)
b
b
b
5,000
7,300
8,500
9,300
Estimated Estimated
Value of Percent of U.S.
Shipments Shipments
(5 million)
200 4-8
9,500 1-3
150 1-2
1,500 5-10
2,000 5-10
1,500 2-5
800 10-15
Wisconsin Totals3
Estimated
Value of
Shipments
($ million)
8-16
100-300
2-4
70-150
100-200
30-75
80-120
Estimated
No. of Units
Shipped
(Thousand)
b
b
b
250-500
350-750
170-450
930-1400
15,650
2-6
390-865
1,700-3,100
a- Current Industrial Reports. Major Household Appliances, 1977 (issued June 1978) for categories 3631, 3632, 3633 and
Census of Manufactures Service Industry Machine Shops (issued March 1975 and updated to 1977) for categories
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 WISCONSIN ECONOMIC DATA
Estimated Wisconsin
Economic Indicators
Total 1977 value
of shipments of
all manufactured
goods
Number of employees
in manufacturing
$.34.1 Billion
500,000-550,000
Estimated Percent of Wisconsin
Manufacturing Economy Engaged
in Large Appliance Manufacturing
1.0 to 2.7
0.8 to 0.9
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 24,
1978) for categories 3631, 3632, 3633 and 3585; Sales and Marketing Management,
April 25, 1977; 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
Washer
Dryer
Range
Dishwasher
Refrigerator 5.2
Appliance Sales (Millions of Units)
1968
2.9
2.9
4.4
1.9
5.2
1969
4.4
3.0
4.5
2.1
5.3
19
4
2
4
2
5
70
.1
.9
.5
.1
.3
1971
4.6
3.3
4.3
2.5
5.7
19
5
3
4
3
6
72
.1
.9
.8
.2
.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
-------
EXHIBIT 10-6
U.S. Environmental Protection Agency
FIVE-YEAR U.S. SALES FORECAST FOR
SELECTED MAJOR HOUSEHOLD APPLIANCES
(1978-1982)
Appliance Estimates (Millions of Units)
Appliance
Washer
Dryer
Range
Dishwasher
Refrigerator
1978 1979 1980 1981 1982
5.4 5.6 5.7 5.8 5.8
4.0 4.2 4.4 4.5 4.6
5.2 5.4 5.6 5.7 5.8
3.7 3.9 4.1 4.4 4.6
6.0 6.2 6.4 6.5 6.6
Source: 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 Wisconsin 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
-------
1 XlilUIT 1(1- 7
U.S. Environmental Protection Agency
PRESENT MAMUI-'ACI'UIUNi; TECHNOLOGY DESCRIPTION
AND PI:I TREATMENT
!J! :_><[< ! I 'TliiN
! Ian.-'. plant typically manu-
oil' ot I Wo dllfeicnt types ot
and conl.iins only one or
. ' J 1 .t . may 1 a in I.' I 1 oin 1 , 2OIJ to
; , ' ,•' IP. t.-i L. ( i/-l to -!-]/:•
•n i ' L .) in 1 ength
' iiif> in.iy opi-rate at speeds of
! to I •• iin'tei •_, ( H) to bO leet)
i >.•! mi nu t .:
1 11 ti .lie t i ,ins(>ort.i:d on overliead
. i-'lu-uud iii aii alkcillne solution
. I.' i nsi .1
. "'ii-.iied wiih ^inc or iron plios-
'Irojie.i with chroiiuite (it
•ion |oot hs i i|u i pp. d
with water wash and und. i .jo. :.
,1 I.J-nllnUte llashoft pel lo.l
Insidi ol many ex t el J or Large ai^pli-
a In .: pa I t ', alt- • ,1 u ayi-i i w 1 L h . |e 1 -,. Jll 1 t e
t.'i additional HUM.,tuli- t . s i si an.-.-
an.t I . »! sourikl d. adi -ii I n.j
CIIKING PROCUSS DESCRIPTION
Coated parts are baked for about
20 minutes at lbO°C to
-------
EXHIBIT 10-8
U.S. Environmental Protection Agency
DIAGRAM OF 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
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 VOCDemis-
sions in Wisconsin 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
Dip 50
Flow coat
60
Spray 80
The percent reduction of emissions for prime coating with
waterborne dip of 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 Wisconsin. The estimated emissions in Wisconsin from seven
appliance coating facilities are 400 tons per year.
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 WISCONSIN
Facility Name
Current Average
Hydrocarbon
Emissions
(Ton/Year)
Potential Control
Efficiency
with PACT
(Percent)
Potential Emission
Reduction
with RACT
(Ton/Year)
Insinkerator Div.
Emerson Electric
30
70
21
Kelvinator Commercial Products
20
70
14
Malleable Iron Range Co,
McGraw Edison Co.
M-C Company
30
200
10
70
70
70
21
140
Trane Co.
80
70
50
United Refrigerator Co.
Total
30
400
70
21
280
Source: Wisconsin Point Source Emissions Inventory
-------
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
kg solvent per liter Ibs. solvent per gallon
Affected of coating of coating
Facility (minus water) (minus water)
Prime, single
or topcoat
application
area, flash-
off area and
oven 0.34 2.8
Source: Control of Volatile Organic Emissions from Existing
Stationary Sources—Volume V; Surface Coating of
Large Appliances, EPA-450/2-77-034, December 1977.
-------
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 / High Solids (Sprayl
Doors
Lids
Panels \\ "V Top or Exterior
Cases \\ Single Coat and
Interior Parts \\ Sound Deadener
Waterborne
(Spray, Dip or Flow Coat)
Carbon Adsorption
Prime, Single or
Topcoat Application \
and Flashoff Areas
\
Waterborne
(Spray, Dip or Flow Coat)
Incineration
Ovenss Spray Booths/
\ Carbon Adsorption
Source^ Control of Volatile Organic Emissions from Existing Stationary Sources—Volqroe V: Surface Coating of Large Appliances, EPA-450/2-77-034,
December 1977.
-------
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)
90-953
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
spray booths
Carbon adsorption
901
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.
This percent reduction in VOC emissions is only across
r
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: Control of Volatile Organic Emissions from Exist J nq Stationary Sn..rn.,B—Vr,i.««. V:
Surface Coatings of Large Appliances. EPA-450/;- ril(\ii, r^^b-r J977.
-------
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 electrodeposition 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
-------
EXHIBIT 10-13
U.S. Environmental Protection Agency
MOST LIKELY RACT CONTROL ALTERNATIVES FOR
SURFACE COATING OF LARGE APPLIANCES
IN STATE OF WISCONSIN
Coat
Prime
Existing System
Dip or flow coating
Conventional solvent
Most Likely Alternative Control Techniques
Dip or flow coating with waterborne
solvent
Electrostatic application with discs
or bells of high solids coatings
Preheat paint, or
Use high speed discs
or bells
Top
Electrostatic appli-
cation with discs or
bells of conventional
solvents
Electrostatic application with discs or
bells of high solids coating
Preheat paint, or
Use high speed discs
or bells
Source: Booz, Allen & Hamilton Inc.
-------
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
solventborne 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 primecoat 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 waterborne 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
-------
EXHIBIT 10-14
U.S. EnvironmcnLa] Protection Agency
ESTIMATED COST FOR PROCESS MODIFICATION
OF EXISTING LARGE APPLIANCE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION CONTROL
1' >: i ij': i n^ Sy a t em
!') lllli'COdt
(Viiivi-iiL Luna I
LJU ! Von t — b.ilaod
i-i '. p OL t low
Conventional
so 1 vc-n L — 1 >astjd
i- ' t.'C tl OS la tlC
.•joray, dibC
01 boll
'"oocoat
Conventional
sol von'..- batied
t- leotrotj ta 11 c
spray, ciiac
or bo ' 1
Most Likely
Control Alternative
Watorborne dip of
tlow coat
Hiyh solids
electrostdtic
High solids
electrostatic
Major Process
Modi Citation
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 confiyuration
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
Moo 2 , A Men
Hamilton J no .
-------
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 $6,000 per year per line (equivalent to 700 cubic
feet of natural gas/hour/line).
The overall cost of coating materials may increase slightly
even though conversion to water-based or high solids coating
will eliminate the need for solvent thinning. This overall
increase is expected because of the anticipated price increases
in the coatings that will be required to meet the RACT guidelines
At this time, definitive numbers in the changes of paint prices
cannot be developed but an overall paint cost increase of
between 10 percent and 20 percent may be anticipated.
10.5.2 Extrapolation to the Statewide Industry
Exhibit 10-15, on the following page, extrapolates the
costs for meeting RACT guidelines for VOC emission control
for surface coating of large appliances to the statewide
industry in Wisconsin. The estimates are based on the following
assumptions:
All large appliance coaters will implement
the control alternatives stated in this
report to comply with RACT.
10 12
-------
EXHIBIT 10-15
U.S. Environmental Protection Agency
STATEWIDE COSTS FOR PROCESS MODIFICATIONS OF
EXISTING LARGE APPLIANCE COATING LINES
TO MEET RACT GUIDELINES FOR VOC EMISSION CONTROL
WISCONSIN
Characteristic
Plants with Top-
coat Process Only
Number of plants 4
Number of process lines 8
Estimated value of shipments
($ Million) 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-309e
Plants with Primecoat
and Topcoat Process
3
6
a
a
a
1425
(12-36)
356
320d-344S
Total
7
14
390-865
400
280
2725
(28-84)
81
597d-653e
2132d-2332e
a. Not 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 7 plants identified by the Wisconsin
EPA and from Booz, Allen interviews 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 modifications
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 assumptions, the total capital cost
to the industry in Wisconsin for process modifications to meet
RACT guidelines is estimated at $2.7 million. The annual cost
is estimated at $2,132 to $2,332 per ton of emission controlled.
10-13
-------
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 sev-
eral requirements on major appliance coaters:
Determine the appropriate emission control
system.
Raise or allocate capital to purchase
equipment.
Acquire the necessary equipment for emis-
sion control.
Install and test the emission control
equipment to insure that the system com-
plies with RACT.
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 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
-------
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 130°F-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 0.11 percent of the
industry's 1977 value of shipments manufactured in the state.
This increase may translate to an approximate cost increase
of $0.19 per unit of household appliance coated; the average
cost of a unit is $170.
The major economic impact in terms of cost to individual
companies will be capital related rather than from increased
annualized costs. The capital required for RACT compliance
may represent a significant amount of capital appropriations
for the companies 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., if certain
manufacturers incur disproportionate compliance costs they
probably will 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 implementing RACT for
surface coating of large appliances in the state of Wisconsin.
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 WISCONSIN
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 seven major large appliance manu-
facturers and coaters
1977 statewide value of shipments was estimated
at $600 million and represents 4 percent of the;
estimated $15 billion U.S. value of shipments
of the major appliance industry
400 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
$2.7 million
$625,000 which represents 0.11 percent of the
industry's 1977 statewide value of shipments
Assuming a "direct cost pass-through"—increase
of $0.19/unit for household appliances (based on
a price of $170 per household appliance)
Reduced natural gas requirements in the curing
operation (equivalent to 5,600 barrels of oil
per year)
No major impact
No major impact
No major impact
No problem meeting equipment deliveries and
installation are anticipated
Commercial application of high solids
(greater than 62% by volume) has not been
proven
120 tons/year (30 percent of 1977 emission
level)
$2,232 annualized cost/ton VOC reduction
Source; Booz, Allen & 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 Existing Stationary
Sources—Volume V; Surface Coating of Large Appliances,
EPA-450/2077-034, December 1977.
Private conversations with the following:
Association of Home Appliances Manufacturers, Chicago, Illinois
Ferro Corporation, Cleveland, Ohio
McGraw Edison, Racine, Wisconsin
Nordsen Corporation, Amherst, Ohio
Ransburg Corporation, Indianapolis, Indiana
Trane Co., LaCrosse, Wisconsin
-------
11.0 THE ECONOMIC IMPACT FOR IMPLEMENTING RACT
FOR SOLVENT METAL CLEANING (DECREASING) IN
THE STATE OF WISCONSIN
-------
11.0 THE ECONOMIC IMPACT OF IMPLEMENTING RACT FOR
SOLVENT METAL CLEANING (DECREASING)
IN THE STATE OF WISCONSIN
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; interviews
with degreaser users, equipment manufacturers and material
manufacturers; and a review of pertinent published literature.
11-1
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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 operations
and maintenance operations. The conveyorized cleaners are
designed for continuous use and are normally found in manufacturing
operations. A more detailed discussion 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 manufacturing. There
are also an estimated 22,000 open top vapor degreasers and 4,000
conveyorized vapor 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.
Control of Volatile Organic Emissions from Solvent Metal
Cleaning, EPA-450/2-77-022, November, 1977.
11-2
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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 operations
and maintenance operations. The conveyorized cleaners are
designed for continuous use and are normally found in manufacturing
operations. A more detailed discussion 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 manufacturing. There
are also an estimated 22,000 open top vapor degreasers and 4,000
conveyorized vapor 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.
Control of Volatile Organic Emissions from Solvent Metal
Cleaning, EPA-450/2-77-002, November, 1977.
11-3
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As recently as 1974, degreasing operations were exempt
from regulation in 16 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. How-
ever, 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 sizable
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 tem-
perature 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 implementing
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 industry-
wide 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.
11-4
-------
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 manufacturing 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 deter-
mined for the state. The average number of plants using solvent
metal degreasing and the average number and types 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 the 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 conveyorized cleaners by 100/85, the EPA2
estimated ratio of total conveyorized cleaners to vapor conveyor-
ized cleaners in the U.S.
Interviews with Parker Johnson, Vice President, Sales,
Baron Blakeslee Corp., Cicero, Illinois and with Richard
Clement, Sales Manager, Detrex Chemical, Detroit, Michigan,
July 1978.
Control of Volatile Organic Emissions from Solvent Metal
Cleaning, EPA-450/2-77-022, November 1977.
11-5
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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 estimate1 of 1,300,000
cold metal cleaners in the U.S., which include 390,000 in manu-
facturing use and 910,000 in maintenance or service use.2 Then:
The EPA estimate of all cold cleaners in manu-
facturing 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 main-
tenance 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
IEPA-450/2-77-002, Op. cit.
2 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
establishments.
11-6
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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 estimatel of 1,300,000
cold metal cleaners in the U.S., which include 390,000 in manu-
facturing use and 910,000 in maintenance or service use.2 Then:
The EPA estimate of all cold cleaners in manu-
facturing 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 main-
tenance 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,
1EPA-450/2-77-022, Op. cit.
2 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
establishments.
11-7
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11.1.3 Method of Estimation of Affected Degreasers
The RACT guidelines propose several exemptions for degreasers
based primarily on size, type of solvent used or emission rate.
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
trichlorotrifluoroethane 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.2 For the purpose of
calculating cost impacts in this study, 35 per-
cent was used. About 10 percent of conveyorized
cleaners are expected to be exempt2 and about
20 percent of cold cleaners.^
Oven top vapor degreasers with less than one
square meter (10.8 square feet) air/vapor inter-
face and conveyorized degreasers with less than
two square meters (21.6 square feet) interface
are to be exempt. This exemption applies to
about 30 percent of open top cleaners and 5 per-
cent of conveyorized degreasers.2
Interviews 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
11-8
-------
The guidelines leave open to the degreaser user the option of
changing from a 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. In most cases,
1,1,1-trichloroethane would be used as a substitute for existing
solvents; this would require equipment conversions because of
potential corrosiveness and other properties of this compound.
Estimations of costs of conversion were not made since data are
unavailable on a number of systems which could be converted.
If Freon 113 were used as a substitute, new cleaners would
probably have to be purchased.
No reliable data have 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 fractions 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 - fraction 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 milli-
meters of mercury at 38
11-9
-------
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.
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 re-
frigerated 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
11-10
-------
Openings must be minimized during operation
so that entrances and exits silhouette work-
loads; and
Downtime covers must be provided for closing
off the entrace and exit during shutdown
hours.
Exhibits 11-6, 11-7 and 11-8, in section 11.4, 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.
11.1.5 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 regu-
lations are based on information presented in Control of Volatile
Organic Emissions from Solvent Metal Cleaning, EPA-450/2-77-Q22,
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 guidelines can result in a reduction of
50 percent to 69 percent for various types of degreasers. Emission
levels which would result from implementation of the RACT pro-
posals 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 53 percent reduction was
used for cold cleaners. For open top vapor and conveyorized
cleaners, a 60 percent reduction was used.
11-11
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11.1.6 Method of Estimation of Compliance Costs
Compliance costs 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, how-
ever, 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 based on further
discussions with equipment manufacturers. In the report, costs
were presented for various retrofit control options; in each case,
the control which would provide minimum net annualized costs was
used. Other costs not presented in the EPA report were determined
as follows:
Capital costs for safety switches, minimizing
conveyorized cleaner openings and downtime
covers were estimated on the basis of discussions
with equipment 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, $2,500
per drying tunnel and $1,000 for reducing
openings for conveyorized cleaners.
An average of $300 was estimated as the cost to
increase freeboard of cold cleaners using high
volatility solvents.
Additional annual capital charges were estimated
at 25 percent of capital costs, to include depre-
ciation, interest, maintenance, insurance and
administrative costs.
Labor costs for mounting downtime covers on con-
veyorized 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.
11-12
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11.1.7 Quality Of Estimates
Several sources of information were utilized in assessing
the emissions, direct compliance cost and economic impact of imple-
menting RACT controls on plants using solvent metal degreasers
in Wisconsin. 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 not available
in secondary literature and were extrapolated from hard data
and "C" indicates data were estimated based on interviews, analyses
of previous studies and best engineering judgment. Exhibit 11-1,
on the following page, rates each study output and overall quality
of the data.
11-13
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EXHIBIT 11-1
U.S. Environmental Protection Agency
DATA QUALITY
Study Outputs
A B C
Hard Extrapolated Estimated
Data Data 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.
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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 503 open top
vapor degreasers, 119 conveyorized degreasers and 30,900 cold
cleaners are estimated to be in use in Wisconsin 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 conveyorized 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 establishments
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 industries.
These classifications include such industries as automotive,
electronics, app/liances, 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 manufacturing 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, 633 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 3,165 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.
11-14
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EXHIBIT J1-2U)
U.S. Environmental Protection Agency
ESTIMATED NUMBER OF VAPOR OEGREASERS
IN WTSCONSINe
SIC Group
Item
Number of Wisconsin
plants with more
than 19 employees3
Percent of U.S.
plants using sol-
vent degreasingb
Percent of Wisconsin
plants using sol-
vent degreasing
Number of Wisconsin
plants using sol-
vent degreasing
Percent of U.S.
plants using vapor
degreasing
Percent of Wisconsin
plants using vapor
degreasing
Number of Wisconsin
plants using vapor
degreasing
Average number of
vapor degreasers
per U.S. plant
Average number of
vapor degreasers
per Wisconsin
plant
Number of vapor de-
greasers in Wisconsin
25
Metal
Furniture
71
46
45
32
48
46
1.98
1.85
28
33
Primary
Metals
155
40
39
60
42
40
24
2.21
2.06
49
34
Fabricated
Products
309
42
41
127
41
39
49
1.62
1.51
74
35 36
Nonelectri- Electrical
cal Machinery Equipment
458
52
51
233
33
31
72
1.61
1.50
151
55
108
81
67
64
52
2.03
1.89
98
37
Transptn.
Equipment
73
50
49
36
43
41
15
3.25
3.03
45
38
Instruments
and clocks
65
64
28
62
59
16
2.27
2.12
34
39
Misc.
Industry Total
96 1,357
39
38
36
56
53
11
1.02
0.95
10
633
446
-------
EXHIBIT 11-2(2)
U.S. Environmental Protection Agency
(Wisconsin)
SIC Group
Item
Percent in U.S.
as open top de-
greasers
Percent in Wisconsin
as open top de-
greasers
Number of open top
vapor degreasers
in Wisconsin
Number of conveyor-
ized vapor degreasers
in Wisconsin
25
Metal
E'urniture
74
69
19
33
Primary
Metals
79
74
36
13
34
Fabricated
Products
79
74
55
19
35 36
Nonelectri- Electrical
cal Machinery Equipment
81
76
82
26
87
81
79
19
37
Transptn.
Equipment
87
81
36
38
Instruments
and clocks
94
88
30
39
Misc.
Industry Total
89
83
34 5C
101'
Note: All data based on plants with more than 19 employees
a. Source: County Business Patterns, U.S. Dept. of Commerce, 1976
b. Source of data on percentage of solvents degreasing, those with open top or conveyorized vapor degreasers and average
numbers of degreasers per plant: Study to Support New Source Performance Standards for Solvent Metal Cleaning Operations,
Dow Chemical Company under EPA Contract 68-02-1329, June 30, 1976
c. To adjust quantities to account for vapor degreasers in other SIC groups 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 groups.
d. To 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.
e. Number of degreasers rounded to nearest whole integer.
Source; Booz, Allen & Hamilton Inc. analysis of Department of Commerce and EPA Reports
-------
EXHIBIT 11-3
U.S. Environmental Protection Agency
ESTIMATED NUMBERS OF COLD
CLEANERS IN WISCONSIN
U.S.
Total number of plants in SIC Groups 125,271
25, 33, 34, 35, 36, 37, 38, 39a
Estimated number of cold cleaners in 390,000
manufacturing"
Total number of plants in service 227,350
industries 551, 554, 557, 7538, 7539, 7964a
Estimated number of cold cleaners 910,000
in maintenance and service use°'c
Estimated total number of cold cleaners3 1,300,000
Notes:
a. Source: 1976 County Business Patterns, U.S. Department of Commerce, 1976.
b. Source: Control of Volatile Organic Emissions From Solvent Metal Cleaning
Wisconsin
3,165
9,850
4,992
21,050
30,900
, EPA-450/
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 NONEXEMPT SOLVENT METAL
CLEANERS IN WISCONSIN
Exemption
Cold
Number of Cleaners by Type
Open Top Vapor
Conveyorized
Total number of
cleaners
30,900
503
119
Number exempt by size
21,630
150
Number nonexempt by
size
9,270
353
113
Number further exempted
by type of solvent
used
1,850
176
11
Total number of non-
exempt cleaners
7,420
177
102
Source: Booz, Allen & Hamilton Inc.
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11.3 THE TECHNICAL SITUATION IN THE INDUSTRY
11.3.1 Solvent Metal Cleaning Processes1
Solvent metal cleaning describes those processes using non-
aqueous solvents to clean and remove soils from metal surfaces.
These solvents, which are principally derived from petroleum,
include petroleum distillates, chlorinated hydrocarbons, keytones
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 of 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.
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 des-
cription of the techniques and devices used for solvent
degreasing.
11-15
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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
Trlchlorotrifluoroethane
(FC-113)
Ketones
Acetone
Methyl ethyl ketone
Source; Booz, Allen & Hamilton Inc.
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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 disposed
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 national
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 square meters (4 square
feet) of opening and about 0.1 cubic meters (30 gallons)
of 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 maintenance 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 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 maintenance and manufacturing purpose
and thus are difficult to classify.
11-16
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-------
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 dis-
solves 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 withdrawn 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 solvent
vapor. At least one section of the tank is equipped with a heating
system that uses steam, electricity or fuel combustion 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.
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 equipment. 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.
11-17
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FIGURE 11-2
U.S. Environmental Protection Agency
OPEN TOP DEGREASER
Safety Thermostat
Condensing Coils
Temperature
Indicator
Cleanout Door
Solvent Level Sight Glass
Freeboard
Water Jacket
Condensate Trough
Water Separator
Heating Elements
Work Rest And Protective Grate
Source: EPA 450/2-77-022
-------
Nearly all vapor degreasers are equipped with a water
separator, such as that depicted in Figure 11-2. The condensed
solvent and moisture are collected in a trough below the con-
denser 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, oper-
ating 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 de-
greasers 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 constant
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 de-
greasers .
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 con-
tained 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.
11-18
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FIGURE 11-3
n q Environmental Protection Agency
CONVEYORIZED DEGREASER
-------
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 practices
and simple, inexpensive control equipment. Control system B con-
sists of system A plus other devices that increase the effective-
ness 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 Exhibits 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.
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 tech-
niques 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 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
reductions in a few applications.
EPA-450/2-77-022
11-19
-------
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*** of 0.7
b. Water cover (solvent must be insoluble in ano 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.
*** Freeboard ratio is defined as the freeboard height divided by the width of the degreaser.
Source: EPA-450/2-77-022
-------
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 in/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'a 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.
o o 2
9. Exhaust ventilation should not exceed 20 nr/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).
-------
J-iAll-LO-L J. JL.L — I (Z)
U.S. Environmental Protection Agency
3. Major Control Device:
Either: a. Freeboard ratio greater than or equal to 0.75, and if the degreaser opening is
1 m2 (10 ft ), 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/min 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 #1 to #6.
Operating Requirements:
Same as in System A.
Source; EPA-450/2-77-022
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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 m-^/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.
-------
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 emission 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 additional
devices required in system B generally control only bath evapor-
ation, about 20 percent to 30 percent of the total emissions from
an average cold cleaner. For cold cleaners with high volatility
solvents, bath evaporation may contribute about 50 percent of the
total emissions; EPA estimates that system B could achieve 69 ( + 20)
percent control efficiency, whereas system A might achieve only
55C+ 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, en-
closed 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 pre-
vent 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.
EPA estimates that system A may reduce open top vapor de-
greasing emissions by 45(+ 15) percent, and system B by 60 (+ 15)
percent. For an average-sized open top vapor degreaser, systems
A and B would reduce emissions from 9.5 metric tons per year down
to about 5.0 and 3.8 metric tons per 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 conveyorized
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 de-
greasers as recommended by EPA are in Exhibit 11-8. Control
system A requires only proper operating procedures which can be
implemented, in most cases, without large capital expenditures.
Control system B, on the other hand, requires a major control
device.
11-20
-------
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.
11.3.3 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 implementation 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 achievable 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 19,200 short tons per year to a total of 14,600 short tons
per year. The major portion of these reduced emissions 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 4,500 short tons per
year (19,200 minus 14,700).
11-21
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EXHIBIT 11-9
U.S. Environmental Protection Agency
AVERAGE UNIT EMISSION RATES AND EXPECTED
EMISSION REDUCTIONS
1. EMISSION RATES WITHOUT CONTROLS
Averaged Emission Rate
Type of Degreaser Per Unit (short tons/yr.)
Cold cleaners, batch a 0.33
Open top vapor degreaser 11.00
Conveyorized degreaser 29.70
2. 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)
a. Does 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 WISCONSIN
(Short Tons)
Type of Cleaner
Open top vapor
Conveyorized
Cold
Estimated
Current
Emissions
5,500
3,500
10,200
Estimated
Emissions
Subject to RACT
2,500
3,000
2,400
Emissions Estimated
from Nonexempt
Cleaners After
RACT
1,000
1,200
1,200
Estimated
Emissions from
Exempt Cleaners
after RACTa
3,000
500
7,800
Estimated
Total
Emissions
after RACTa
4,000
1,700
9,000
Total
19,200
7,900
3,400
11,300
14,700
a. Includes emissions from cleaners exempt by size or using 1,1,1-trichloroethane or Freon 113
Source: Booz, Allen & 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 benefits 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 summarized
in Exhibits 11-13, 11-14 and 11-15, following Exhibit 11-12, on the
assumption that control method B is used to maximize emission re-
duction 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 $2.8 million in capital and $0.26 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 most cases the regulations are not expected to present a
financial burden to individual firms. The largest single expendi-
ture would be for retrofitting a monorail conveyorized degreaser
with chiller, switches, drying tunnel, reduced openings and down-
time covers. Total cost for an average-sized degreaser of about
3.8 square meters area (40.9 square feet) would be less than $12,500.
A large unit, 14 square meters, would cost about $27,000 to $30,000.
Since these conveyorized systems would be used only in large plants
with large sales volumes, this implementation cost is not expected
to present a hardship to any particular firms. However, a few
marginally profitable firms may find access to capital difficult.
The number of such firms is anticipated to be small.
11-22
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EXHIBIT 11-11
U.S. Environmental Protection Agency
CONTROL COSTS FOR AVERAGE-SIZED
COLD CLEANER WITH 5.25 ft.2 AREA
Item
Installed capital ($)
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
Solvent^
365.00
2.60
91.25
(39.36)
54.49
a. Costs include only a drainage facility for low volatility solvents
b. Includes $65 for drainage facility, a mechanically assisted cover,
and extension of freeboard.
c. Capital charges used in study estimate were 25 percent of capital
instead of 17 percent used in EPA report.
Source; EPA-450/2-77-022, op. cit.
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EXHIBIT 11-12
U.S. Environmental Protection Agency
CONTROL COSTS FOR AVERAGE-SIZED
OPEN TOP VAPOR AND CONVEYORIZED CLEANERS
1. CONTROL COSTS FOR TYPICAL SIZE OPEN TOP VAPOR DEGREASER
(Vapor to Air Area of 1.67 m2)
Control Technique
Installed capital ($)
Direct operating
cost ($/yr.)
Capital charges ($/yr.)
Solvent cost (credit)
($/yr.)
Net annualized cost
(credit) ($/yr.)
Manual
Cover
300
10
75
(860)
Carbon
Adsorptiona
10,300
451
2,575
(1,419)
Refrigerated
Chiller
6,500
259
1,625
(1,290)
Extended Freeboard
& Powered Cover
8,000
100
2,000
(1,161)
(775)
1,607
594
939
2. CONTROL COSTS FOR TYPICAL CONVEYORIZED DEGREASERS
(Vapor to Air Vapor Area of 3.8 m2)
Control Technique
Installed capital ($)
Direct operating
costs ($/yr.)
Capital charges ($/yr.)'
Solvent cost (credit)
($/yr.)
Net annualized cost
(credit) ($/yr.)
Monorail Degreaser
(263)
(3,065)
Crossrod Degreaser
Carbona
Adsorber
17,600
970
4,400
(5,633)
Refrigerated
Chiller
8,550
430
2,138
(5,633)
Carbona
Adsorber
17,600
754
4,400
(2,258)
Refrigerated
Chiller
7,460
334
1,865
(2,258)
2,896
(59)
a. Not used in cost estimates since net annualized costs for carbon absorption
are the highest for any control method.
b. Capital charges used in study estimate were 25 percent of capital instead of
17 percent used by EPA source.
Source; EPA 450/2-77-022, op. cit. modified for 25 percent capital
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EXHIBIT 11-13
U.S. Environmental Protection Agency
ESTIMATED CONTROL COSTS FOR COLD CLEANERS
FOR THE STATE OF WISCONSIN
1. CAPITAL COSTS
Item
Capital
Number of Degreasers
Needing Conversion
3,226
Costs ($)
812,000
2. ANNUALIZED COSTS
Item
Direct operating costs
Capital charges
Solvent cost (credit)
Net annualized costs
Costs ($)
5,800
203,000
(87,600)
121,200
a. Assumes that all solvent meets high volatility specifications.
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 11-14
U.S. Environmental Protection Agency
ESTIMATED CONTROL COSTS FOR OPEN TOP
VAPOR DEGREASERS FOR THE STATE OF WISCONSIN
1. CAPITAL COSTS
Item
Safety switches
Powered covers
Manual covers
Total
Costs ($)
5,900
1,104,000
20,700
1,130,600
2. ANNUALIZED COSTS
Item
Direct operating costs
Capital charges
Solvent cost (credit)
Net annualized costs
Costs ($)
14,500
282,600
(219,600)
77,500
Source: Booz, Allen & Hamilton Inc.
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EXHIBIT 11-15
U.S. Environmental Protection Agenc
ESTIMATED CONTROL COSTS FOR CONVEYORI
DEGREASERS FOR THE STATE OF WISCONS
1. CAPITAL COSTS
Item
Refrigerator chillers
Monorail degreasers
Crossrod degreasers
Safety switches
Drying tunnel
Reduce openings
Downtime covers
Total
Costs ($)
316,400
410,300
5,000
25,000
92,000
27,600
876,300
2. ANNUALIZED COSTS
Item
Direct operating costs
Capital charges
Solvent cost (credit)
Net annualized cost
Costs ($)
172,300
219,100
(332,600)
58,800
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 WISCONSIN
Percent of Number of Cleaners
Type of Control Cleaners Needing Control5 Needing Control
Manual cover 30 2,226
a. Assumes that all solvent meets high volatility specifications.
Source; Booz, Allen & Hamilton Inc.
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EXHIBIT 11-17
U.S. Environmental Protection Agenc
ESTIMATED NUMBER OF OPEN TOP VAPOF
DEGREASERS NEEDING CONTROL IN THE
STATE OF WISCONSIN
Percent of Number of Cleaner
Type of Control Cleaners Needing Control Needing Control
Manual covers 30 69
Safety switches 20 46
Powered cover 60 138
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 WISCONSIN
Percent of Cleaners Number of Cleaners
Type of Control Needing Control Needing Control
Refrigerated chillers for 36 37
monorail and miscel-
laneous type cleanersa
Refrigerated chillers for 54 55
crossrod type cleaners
Safety switches 20 20
Drying tunnel 10 10
Minimized openings 90 92
Downtime covers 90 92
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 (230 open top vapor degreasers, 102 conveyorized de-
greasers and 7,420 cold cleaners in Wisconsin alone) and because
each requires retrofitting of a control device, some users may
not be able to comply within proposed compliance schedules because
equipment is not available. 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
converted to 1,1,1-trichloroethane and thus become exempt. In
fact, many metal solvent cleaners have been converted to trichloro-
ethane 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 constructic
Trichloroethane can be extremely corrosive if stabilizers are in-
sufficiently replenished. In fact, stainless steel vapor degreasei
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 is 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 annualized costs required by solvent
metal cleaner owners. For example, total shipments in SIC groups
25 and 33-39 alone exceeded $16.1 billion in 1975 and are expected
to exceed $18 billion in 1978. Total capital expenditures for
retrofitting are estimated to amount to about 0.015 percent of
this; annualized costs are estimated to be less than 0.01 percent,
including a slight drop in productivity because of work practice
modifications.
Similarly, implementation is expected to have a negligible
impact on total capital expenditures, which amounted to about
$30 million in 1975 for these eight SIC groups. Since it appears
that compliance may require several years in practice, average
capital expenditures will be about $1.1 million to $1.4 million
per year and would be about 0.3 percent or less of normal capital
expenditures for plants in these SIC groups. Considering 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. Total solvent credits were estimated at
about $0.6 million for all types of cleaners, as shown in Exhibits
11-13, 11-14 and 11-15. This reduction in solvent purchases may
result in a small loss of employment for firms supplying metal
cleaning solvents.
11-23
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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 1.7 square meters size.1 For a typical
conveyorized degreaser of about 3.8 square meters size, consumption
is estimated, on this basis, to be 0.5 kw to 5.0 kw. Only con-
veyorized degreasers are expected to use chillers to comply; and
about 90 percent or 92 of these currently do not have chillers.
Assuming 2,250 hours per year operation, total additional energy
consumption annually would be about 105,000 kw-hours to 1,050,000
kw-hours. This is equal to $4,200 to $42,000 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.
EPA-450/2-7-022,op.cit.
11-24
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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 normally a minor step in the manufacturing or
service process, any change in productivity and employment in
user plants will be insignificant.
There will, however, be some temporary increases in employ-
ment 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 employ-
ment 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. Even this would probably not be a
significant financial burden to small-sized firms.
Exhibit 11-19, on the following page, summarizes the con-
clusions presented in this report.
11-25
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EXHIBIT 11-19
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR SOLVENT METAL DECREASING
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected facilities
Indication of relative importance of in-
dustrial 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
Discussion
About 15,000 plants
Value of shipments of firms in SIC groups
affected is in the range of $16.0 billion,
about one-half of the state's 1977 value
of shipments.
Where technically feasible, firms are sub-
stituting exempt solvents.
19,200 tons/year of which 7,900 tons are
subject to RACT
Substitution. Otherwise lowest cost option
as specified by EPA will be used.
Equipment modifications as specified by the
RACT guidelines
Affected Areas in Meeting RACT
Capital investment (statewide!
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market Structure
RACT timing requirements (19.82)
Problem Areas
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$2.8 million
$0.26 million, (approximately 0.015 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 600 equivalent barrels of oil
per year increase
5-10 percent decrease for manually operated
degreasers. Will not affect 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 modifi-
cations
No significant problem areas seen. Most
firms will be able to absorb cost.
14,700 tons/year (77 percent of 1977 VOC
emission level—however, this does not in-
clude emission controls for exempt solvents)
$58 annualized cost per ton of emissions
reduced.
Source: Booz, Allen & Hamilton Inc.
-------
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 68-02-1329, June 30, 1976.
Private conversations with the following:
Detrex 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
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12.0 THE ECONOMIC IMPACT OF IMPLEMENTING
RACT FOR CONTROL OF REFINERY VACUUM
PRODUCING SYSTEMS', WASTEWATBR SEPARATORS
AND PROCESS UNIT TURNAROUNDS IN THE
STATE OF WISCONSIN
-------
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 WISCONSIN
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 Wisconsin. 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
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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 wisconsii
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 Refinery 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.——
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 Wisconsin. The specific studies analyzed
were: Human Exposures to Atmospheric Emissions from Refineries,
American Petrqleuiv. 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.
12.1.4 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
Determining installed capital costs to the refinery
in Wisconsin
12-3
-------
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.
It was assumed thit the one refinery in Wisconsin has not
implemented any controls because of its aga.
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
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 Wisconsin.
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 Wisconsin. 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
12-4
-------
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
-------
Overall quality of
data
. Exhibit 12-1
U.S. Environmental Protection Agencv
DATA QUALITY
Study Outputs
Industry statistics
Emissions
Cost of emissions
control
Statewide costs of
emissions
Economic impact
Hard Data
B
Extrapolated
Data
Estimated
Data
Source: Boo2, Allen S Hamilton, Inc.
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12.2 INDUSTRY STATISTICS
Industry facilities, statistics and business trends
for the refinery in Wisconsin 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 is one refinery in Wisconsin, 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 the Wisconsin refinery 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 Wisconsin by comparing industry
statistics to state economic indicators. Employees in the
refining industry represent 0.01 percent of the total state
civilian labor force of Wisconsin. The value of refined
products from the Wisconsin refinery represents approximately
1.8 percent of the total value of wholesale trade in Wisconsin
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 WISCONSIN
Vacuum
Distillation
Name of Firm Location Crude Capacity Capacity
~~~ (000, barrels per day) (000, barrels per day)
Murphy Oil Corp. Superior 47 21
Source: Oil & 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 WISCONSIN
Establishments
Employees
Output
(000, barrels
per day)
Yearly
Value of
Shipments
($ Million, 1977)
Yearly
Capital
Expenditures
($ Million, 1977)
200
45,000
200
20
a. Estimated by Booz, Allen & Hamilton Inc., based on County Business Patterns (Department of Commerce),
in 1976.
b. Based 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 toal 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.
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 Wisconsin, 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 Wisconsin.
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 199mmHg
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 contact 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 tower and/
or wastewater treatment requirements compared to steam ejector
systems. Aside from the stripping steam, the ejected steam is
essentially all hydrocarbon, so it can 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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TT <= r, • Exibit 12-4
U.S. Environmental Protection Agency
VACUUM PRODUCING SYSTEM UTILIZING
A TWO-STAGE CONTACT CONDENSER
CONDENSER WATER
INCOMING ^
NONCONDENSABLES
AND PROCESS
STEAM
BAROMETRIC LEG
BAROMETRIC
CONDENSERS
T JET STEAM
2nd STAGE
t
TO ATMOSPHERE
OR TO A
CONDENSER FOR
J ET STEAM
HOT WELL
Source; Control of Refinery Vacuum Producing Systems,
Wastewater Separators and Process Unit Turnarounds,
EPA-450/2-77-025.
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Exhibit 12-5
U.S. Environmental Protection Agency
VACUUM PRODUCING SYSTEM UTILIZING
BOOSTER EJECTOR FOR LOW-VACUUM SYSTEM?
CONDENSER WATER
|3rd STAGE
INCOMING
NONCONDENSABLES
AND PROCESS STEAM
T
TO ATMOSPHERE
OR A CONDENSER
OR TO OTHER
NONCONDENSING
STAGES
BAROMETRIC LEG
HOT WELL
Source; Control of Refinery Vacuum Producing Systems,
Wastewater Separators and Process Unit Turnarounds,
EPA-450/2-77-025.
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12.3.3 Wastewater 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 mixtures
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
Refinary units, such as reactors and fractionators, are
periodically shut down and emptied for internal inspection,
and startup 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 atmosphere,
it is through a blowdown stack which is usually remotely
located to ensure that combustible mixtures will not be
released within the refinery.
12.3.4 Emissions and Current Controls
This section presents the estimated VOC emissions from
selected refinery operations in Wisconsin in 1977. It is
assumed that no controls have been implemented for vacuum
producing systems, wastewater separators and process unit
turnarounds in the one refinery in Wisconsin. Exhibit 12-6,
on the following page, shows total estimated emissions from
12-10
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Exibib 12-6
U.S. Environmental Protection Agency
ESTIMATED HYDROCARBON EMISSIONS FROM
SELECTED REFINERY OPERATIONS IN WISCONSIN
. Estimated Hydrocarbon Emissions (TPY)
\
Number of Without. At Complete
a h
Refineries Control Control "
Vacuum Producing Systems 148 negligible
Wastewater Separators 657 negligible
Process Unit Turnarounds 4,763 238
TOTAL 5,568 238
a. 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 Emissions Factors, EPA-450/3-76-039.
It was assumed that emissions from wastewater separators were 40 percent of the emission calculated
using the EPA emission factor for wastewater separators since it is expected that the vapor pressure
is .4 psi rather than 1.5 psi.
b. Assumes 95 percent recoveries.
Source: Booz, Allen & Hamilton Inc.
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the refinery in Wisconsin, along with estimated emissions
at the complete level of control.
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 Wisconsin.
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 noncondensable
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 RACT 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
12.3.7.1 Controlling Emissions from Vacuum Producing Units
Steam ejectors with contact condensers, steam ejectors
with surface condensers, and mechanical vacuum pumps all dis-
charge 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)
12-11
-------
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 VOC are used in the refinery fuel
gas system, thus creating a credit in cost for recovered
petroleum.
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 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 compartment 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
95 percent of these emissions are captured and sent to a
floor system.
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 hydro-
carbons, the vapors can be added to the fuel gas system,
flared or directly vented to atmosphere. Atmospheric
emissions will be greatly reduced if the vapors are combusted
as fuel gas or flared until the pressure in the vessel is as
close to atmospheric pressure as practicably possible.
The exact pressure at which the vent to the atmosphere is
opened will depend on the pressure drop of the disposal
system. Most refineries should easily be able to depressurize
processing units to five psig or below, before venting to the
atmosphere. Many refineries depressurize a vessel to almost
12-12
-------
atmospheric pressure and then steam the vessel to the flare
header, before opening it to atmosphere. In some refineries,
the hydrocarbon concentration is as low as 1 percent to 30
percent before the vessel is vented to atmosphere. It is
assumed 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 the refinery in Wisconsin,
12-13
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12.4 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 emission control
systems described in Section 12.3 are described for vacuum
producing systems, wastewater separators and process unit
turnarounds individually, followed by an aggregation of
these costs for the refinery in Wisconsin.
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 mechnical 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 arrestor
For vacuum producing systems using contact
(barometric) condensers, typical equipment includes:
- 400 feet of piping
12 valves
- 2 flame arresters
- 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 Corporation. The RACT guideline document entitled Con-
trol of Refinery Vacuum Producing Systems, Wastewater Separators
and Process Unit Turnarounds cites a cost of $12.50 per square
foot which has been used in this report. Refineries with old
wastewater separators may be required to rebuild the separators.
Such costs have not been reflected in this reoort because of a
lack of data.
• -> -i i
J.^.— 1 -i
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Exhibit 12-7
U.S. Environmental Protection Agency
INSTALLED CAPITAL COSTS OF VAPOR CONTROL SYST
FOR VACUUM PRODUCING SYSTEMS, WASTEWATER
SEPARATORS AND PROCESS
UNIT TURNAROUNDS
Vacuum Producing
Systems
Surface
Condensors
or Mechanical
($, 1977)
Contact
Condensers
($, 1977)
Wastewater
Separators
($, 1977)
Process Unit
Turnarounds
($, 1977)
24,000
52,000
63,000
100,000
Note: Capita], costs are for a typical 100,000 barrel per day refinery.
a. Equipment includes 200 feet of piping, 6 valves and 1 flame
arrester.
b. Equipment includes 400 feet of piping, 12 valves, 2 flame
arresters, 100 ft.2 area hotwell cover.
c. Cover for 5,000 ft.2 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 $10,000 per pro-
cess unit; there are, on the average, ten process units for
a 100,000 barrel per day refinery.
Cost estimates obtained from Control of Refinery Vacuum
Producing Systems, Wastewater Separators and Process Unit
Turnarounds, EPA-450/2-77-025 and verified through inter-
views will vary from one refinery to another reflecting the
variability in refinery size, configuration, age, product
mix and degree of control.
In Wisconsin it is assumed that no controls have been
implemented due to the age of the refinery.
The remainder of this section presents the costs for
controlling these refinery emissions.
12.4.2 Extrapolation to the Statewide Industry
Exhibit 12-8, on the following page, shows the aggre-
gation of vapor recovery costs to the refinery in Wisconsin.
The cost estimates are based on the following assumptions:
The wastewater separator is estimated to be
7,500 square feet.
The refinery is equipped with vacuum producing
systems with contact condensers.
The refinery has 5 process units.
Installed capital cost includes parts and labor.
Annualized direct operating costs, expected to be
3 percent of installed capital costs, include
costs for labor, utilities, recordkeeping and
training.
Annualized capital charges, estimated to be 25
percent of installed capital costs, include costs
for depreciation, interest, maintenance, taxes and
insurance.
12-15
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Exhibit 12-8
U.S. Environmental Protection Agency
STATEWIDE COSTS FOR VAPOR CONTROL
SYSTEMS FOR REFINERY VACUUM PRODUCING
SYSTEMS, WASTEWATER SEPARATORS AND
PROCESS UNIT TURNAROUNDS
Characteristics/Cost Item
Number of refineries
Total refinery capacity
(barrels per day)
Emission reduction
(tons/year)
Installed capitala
($, 1977)
Direct annual operating
cost f$, 1977)
Annual capital charges
C$, 1977)
Annual gasoline creditb
($, 1977)
Net annual cost
($, 1977)'
Annual cost per ton of
emissions reduced
. C$ per ton)
Data
1
47,000
5,330
168,500
5,055
42,125
12,750
34,430
Installed capital cost is $94,500 for Wastewater separator,
$24,000 for vacuum producing system and $50,000 for process
units.
Based on 95 percent of reduced emissions recovered from vacuu
producing systems, 140 tons, ana valued at $13.00 per carrel.
:um
Source: Booz, Allen & Hamilton Inc.
-------
The petroleum credit is based on recovering 95
percent of emissions from vacuum producing systems
and is valued at $13.00 per barrel.
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, the total cost to the industry for
installing vapor recovery equipment is estimated to be $168,500
The amount of petroleum recovered is valued at approximately
$12,750. The annual cost is estimated to be $6 per ton.
12-16
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12.5 DIRECT ECONOMIC IMPACTS
This section presents the direct economic impacts of
implmenting RACT for the refinery in Wisconsin. The impacts
include capital availability, technical feasibility and
value of shipments. It was assumed that emissions from
vacuum producing systems, wastewater separators and process
unit turnarounds are uncontrolled.
Capital availability—The Wisconsin refinery will
need to raise an estimated $168,500 to implement
RACT controls. It is expected that the refiner
will be able to raise sufficient capital.
Technical feasibility—Emission controls for
vacuum producing units, wastewater separators
and process unit turnarounds have been success-
fully demonstrated in several refineries in the
United States. It is expected that Wisconsin
will be able to successfully implement emission
controls to comply with RACT.
Value of shipments—The net annalized cost of
implementing RACT control is estimated to be
$34,000 which represents approximately 0.02 per-
cent of the current value of shipments at the
refinery.
The section which follows discusses the secondary
impacts resulting from implementing RACT in Wisconsin.
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 Wisconsin.
Market structure—The market structure will remain
unchanged when RACT is implemented in Wisconsin.
Productivity—Worker productivity will probably be
unaffected by implementing RACT in Wisconsin.
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 IMPLEMENTING
RACT FOR REFINERY VACUUM PRODUCING SYSTEMS, WASTEWATER
SEPARATORS AND PROCESS UNIT TURNAROUNDS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected
facilities
Indication of relative importance
tance of industrial section to
state economy
1977 voc actual emissions
Industry preferred method of
VOC control to meet RACT
guidelines
Assumed method of VOC control
to meet RACT guidelines
Discussion
1977 industry sales were $200 million. The
estimated annual crude oil throughput was
16 million barrels
5,600 tons per year
Vapor recovery of emissions by piping
emissions to refinery fuel gas system or
flare and covering wastewater separators
Vapor recovery by piping emissions from
vacuum producing systems to refinery fuel gas
system. Cover wastewater separator, pipe
emissions from process units to flare
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost
(statewide)
Price
Energy
Productivity
Employment
Market structure
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$168,000
$34,000 (approximately 0.02 percent of
the current industry value of shipments)
No major impact
Assuming full recovery of emissions
—net savings of approximately 1,000
equivalent barrels annually
No major impact
No major impact
No major impact
240 tons per year (4 percent of 1977
emission level)
$6 annualized cost/annual ton of VOC
reduction
Source: Sooz, Allen & Hamilton Inc.
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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, EP~AT9'0~5/
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. 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.
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13.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
TANK TRUCK GASOLINE
LOADING TERMINALS IN
THE STATE OF WISCONSIN
-------
13.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
TANK TRUCK GASOLINE
LOADING TERMINALS IN
THE STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT controls for tank truck gasoline loading
terminals in the State of Wisconsin. 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
Wisconsin.
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 extrap-
olated from the 1972 Census of Wholesale Trade,
Petroleum Bulk Stations and Terminals, based on
the decline in the number of terminals from 1967
to 1972.
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 Wisconsin 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 Boojk,
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 Wisconsin were estimated based on gasoline throughput,
emission factors and characteristics of tank truck gasoline
loading terminals presented in Hydrocarbon Control Strategies
for Gasoline Marketing Operations, EPA-450/3-78-017.
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 Wisconsin. The specific studies analyzed were:
Demonstration of Reduced Hydrocarbon Emissions from Gasoline
Loadingf Terminals', PB-2'4"3'~ 363~; 'Systems and Costs to Control
Hydrocarbon Emissigns>jfrom_S;tationary SjourGeSf PB-236 921;
and The Economic Ijnpact 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 cf 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
Wisconsin
Aggregating costs to the total industry in Wisconsin.
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
Wisconsin required a profile of tank truck gasoline loading
terminals in the state by size of gasoline throughput. A
national profile is presented which is assumed to approximate
the terminals in Wisconsin, since no other data were avail-
able to characterize terminal throughput in Wisconsin.
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 Wisconsin.
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 Wisconsin. 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 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
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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 Wisconsin 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 Wisconsin
13.2.1 Size of the Industry
There were an estimated 41 tank truck gasoline loading
terminals, as of 1977, in Wisconsin. Industry sales were in
the range of $940 million, with an estimated yearly through-
put of 2.211 billion gallons of gasoline. The estimated
number of employees in 1977 was 466 . These data and the
sources of information are summarized in Exhibit 13-2, on
the following page. Annual capital investments have not
been estimated. In general, tank truck gasoline loading
terminal investments are for plant and equipment to replace
worn-out facilities, modernize the establishments or improve
operating efficiencies.
13.2.2 Comparison of the Industry to the State Economy
A comparison of the tank truck gasoline loading terminal
industry to the economy of the State of Wisconsin is shown 'in
this section by comparing industry statistics to state
economic indicators. Employees in the tank truck gasoline
loading terminal industry represent 0.02 percent of the total
state civilian labor force of Wisconsin. The value of gasoline
sold from terminals represented approximately 19 percent of the
total value of wholesale trade in Wisconsin in 1977.
13.2.3 Characterization of the Industry
Tank truck gasoline loading terminals are the primary
distribution point in the petroleum product marketing network
as shown in Exhibit 13-3, following Exhibit 13-2. Terminals
receive gasoline from refineries by pipeline, tanker or
barge.
13-6
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Exhibit 13-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR TANK TRUCK
GASOLINE LOADING TERMINALS IN WISCONSIN
Number of Number of
Establishments Employees Sales Gasoline Throughput
($ Billion, 1977) (Billions of Gallons)
41a 466b 0.94° 2.211d
a. Booz, Allen & Hamilton Inc. estimate based on the 1972 Census of
Wholesale Trade, Petroleum Bulk Stations and Terminals.
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
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Exhibit 13-3
U.S. Environmental Protection Agency
GASOLINE DISTRIBUTION NETWORK
REFINERY
V
V.,
BULK .
PLANT
TERMINAL
V
» <•• • ••
\/
LARGE VOLUME
ACCOUNTS
RETAIL
COMMERCIAL
AGRICULTURAL
—o
SHALL VOLUME
ACCOUNTS
AGRICULTURAL
COMMERCIAL
RETAIL
CUSTOMER
PICK-UP
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 Wisconsin, for the purpose of this analysis, since no
other data were available unique to Wisconsin.
13-7
-------
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.
-------
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 Wisconsin, 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 Wisconsin.
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 has an average
of 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. It is assumed that bottom filling is used at 25
percent of the terminals in Wisconsin. 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 Wisconsin 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 Wisconsin. The estimated VOC emissions from the 41
tank truck gasoline loading terminals are 5,Q50 tons r-er vear,
It is estimated that bottom filling is used at 25
percent of the gasoline terminals in Wisconsin and that
the remaining terminals employ top submerged filling. It
13-9
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Exhibit 13-5
U.S. Environmental Protection Agency
VOC EMISSIONS FROM TANK TRUCK GASOLINE
LOADING TERMINALS IN WISCONSIN
Number of Estimated
Facilities Number of Tanks Total Emissions
(tons/year)
41 184a 5,050b
a. Based on Illinois EPA survey indicating 4.5 tanks
per facility.
b. Booz, Allen & Hamilton Inc. estimate based on data
from 21 bulk gasoline terminals operating emission
data to the Wisconsin emission inventory.
Source: Booz, Allen & Hamilton Inc.
-------
s also estimated that two thirds of the terminal storage
apacity is floating roof tanks and the remaining storage
apacity is fixed roof tanks. These estimates are based
n national data presented in Hydrocarbon Control Strategies
or Gasoline Marketing Operations, EPA-450/3-78-017. An
ssumption was made for purposes of this report rhat no
erminals in Wisconsin are currently equipped with vapor re-
overy systems, since no data were obtained from industry
nterviews to indicate otherwise.
3.3.3 RACT Guidelines
The RACT guildelines for VOC emissions control from tank
ruck gasoline loading terminals require the following con-
col 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.
chibit 13-6, on the following page, summarizes the RACT
sidelines for VOC emissions control from tank truck gasoline
fading terminals.
3.3.4 Selection of the Most Likely RACT Alternatives
Control of VOC emissions from tank truck gasoline
oading terminals is achieved using submerged or bottom
illing of storage tanks and of tank trucks and vapor control
f the loading of outgoing trailer-transport trucks. There
re several alternative means of achieving vapor control at
ank truck gasoline loading terminals, based on the type of
apor control equipment installed.
Four likely alternatives for vapor control are:
Adsorption/absorption
Compression refrigeration absorption
Refrigeration
Thermal oxidation.
]ach type of vapor control system is briefly described next.
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
-------
13.3.4.1 Adsoprtion/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.
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 competi-
tive 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 pres-
sure 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 Wisconsin.
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 estimated to be
more costly to build.
13-11
-------
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
vented directly to the thermal oxidizer. It is not expected
that this type of vapor control system will be used in
Wisconsin 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 Wisconsin.
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 Wisconsin can be characterized
by Model Terminal A; the remaining 50 percent are assumed to
be characterized by Model Terminal B.
13-13
-------
Exhibit 13-7
U.S.-Environmental Protection Agency
FACTORY COSTS OF ALTERNATIVE
VAPOR CONTROL SYSTEMS
Type of Control System
Factory Cost
for 250,000
gallon per
day system
($000, 1977)
Factory Cost
for 500,000
gallon per
day system
($000, 1977)
Ad sorption/Abso rpt ion
Compre s s ion-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,
draft report, July 1978.
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 S Hamilton Inc. estimates
-------
Tank Truck Gasoline Loading
Terminal Characteristics
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
Throughput
Loading racks
Storage tanks
Tank trucks
Compartments per account truck
Vapor control systems
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 costa $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
74,550
102,500
19,800
17,050
1,500
_
38,350
74,550
112,900
a. Includes factory cost of equipment, installation and modifications
(100 percent of factory cost) and cost of $3,000 per truck for
modifications
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 ($3,000 per truck)
Annualized direct operating costs which include elec-
tricity, maintenance, operating labor and carbon
replacement costs. Maintenance costs for the
adsorption/absorption system are slightly lower
than those for refrigeration
Annualized capital charges, which include costs for
depreciation, interest, taxes and insurance and
are estimated to be 21 percent of the installed
capital cost
Net annualized costs, which are the sum of the
capital charges and direct operating costs. It
should be noted that gasoline credit has not yet
been accounted for. Gasoline credit will be taken
into account when the costs are extrapolated to
the industry.
Another cost characterization that can be made is hydrocarbon
reduction versus cost. This finding will also be shown in
the statewide analysis.
13.4.3 Extrapolation to the Statewide Industry
Exhibit 13-9, on the following page, shows the extrap-
olation of vapor recovery costs to the statewide industry in
Wisconsin. The estimates are based on the following assump-
tions :
In Wisconsin, 50 percent of the tank truck gasoline
loading terminals can be characterized by Model
Terminal A and the remaining can be characterized
by Model Terminal B.
Fifty percent of the terminals will implement the
adsorption/absorption vapor control system to com-
ply with RACT and the other 50 percent will imple-
ment the refrigeration system to comply with RACT.
-------
Exhibit 13-9
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL SYSTEMS
FOR TANK TRUCK GASOLINE LOADING TERMINALS
Characteristic/Cost Item Data
Number of terminals 41
Total annual throughput 2.211
(billions of gallons)
Uncontrolled emissions 5,050
(tons/year)
Emission reductiona 4,550
(Tons/year)
Installed capital cost 12.566
($ million, 1977)
Direct annual operating cost 1.122
($ million, 1977
Annual capital charges 2.639
($ millions, 1977)
Annual gasoline credit*3 2.545
($ millions, 1977)
Net annualized cost 1.216
($ millions, 1977)
Annual cost per ton of 267
emissions terminal
emissions only
($ per ton)
Annual cost per ton of 61
emissions reduced53
($ per ton)
Annual cost per ton of 390
emissions reduced from
gasoline marketing0
a. Based on 90 percent control of emissions
b. Based on 19,910 tons of emissions recovered which includes 90
percent of me 8,240 tons collected from gasoline service
stations, 90 psr^ent of the 7,720 tons collected from bulk
plants, and 4,550 tons collected at the terminal
c. Annual cost of emissions reduced from gasoline marketing based
on the sum of net annualized cost from terminals, bulk plants,
gasoline dispensing facilities, and fixed roof tanks divided
by the sum of emission reduction from these same categories
Source: Booz, Allen s Hamilton Inc.
-------
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 annual cost per ton of emis-
sions controlled from terminals is estimated to be $267.
The overall cost of emissions controlled from bulk ter-
minals, including the gasoline recovery from bulk plants
and service stations, is estimated at $61 per tone- controlled,
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 must be implemented statewide 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
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
gasoline savings for terminals, which would minimize the annualized
cost of vapor control.
13.5.3 Comparison of Direct Cost With Selected Direct
Economic Indicators
This section presents a comparison of the net
annualized cost 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 cost to the tank truck gasoline
loading terminals resulting from RACT represents 0.1
percent of the total gasoline sold in the state. When
compared to the statewide value of wholesale trade, the
annualized cost 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
of 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 WISCONSIN
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
41
1977 industry sales were $940 million, with
annual throughput of 2.211 billion gallons.
New terminals are being designed with vapor
recovery equipment
5,050 tons per year
Submerge fill or bottom fill and vapor recovery
Affected Areas in Meeting RACT
Capital investment (statewide
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$12.6 million
$1.2 million (approximately 0.13 percent of
industry value of shipment)
No change in price assuming a "direct cost
passthrough"
Assuming 90 percent recovery of gasoline
—net savings of 31,000 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
500 tons per year (10 percent of 1977
emission level)
?61 annualized cost/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 Stationarv 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.
Hydrocarbon Control Strategies for Gasoline Marketing
Operations, EPA-450/3-78-017.
Private conservation 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, Oklahmoa.
Private conversation with Mr. Frederic Rainey, Shell Oil
Company, Houston, Texas.
-------
"1978 Marketing Directory and Yearbook," Michigan Petroleum
Association, 1978.
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 III
THE STATE OF WISCONSIN
-------
14.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
BULK GASOLINE PLANTS IN
THE STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT controls for bulk gasoline plants in
the State of Wisconsin. 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
-------
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 Wisconsin.
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 pro-
vided by the Wisconsin Department of Natural
Resources based on interviews with district petro-
leum inspectors in Wisconsin.
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 Wisconsin 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 (42.51£/gallon—reported in
the National Petroleum News Fact Book, 1978).
14-2
-------
14.1.2 VOC Emissions
VOC emissions were estimated for bulk gasoline plants
in Wisconsin based on the following methodology: Emissions
per 1,000 gallons of throughput presented in Control of
Volatile Organic Emissions from Bulk Gasoline Plants, EPA-
450/2-77-035 were multiplied by the estimated number of
gallons of gasoline sold from bulk gasoline plants in
Wisconsin in 1977.
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 controlling VOC emis-
sions 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 Wisconsin. The
specific studies analyzed were: Evaluation of Top Loading
Vapor Balance Systems for Small Bulk Plants, EPA 340/1-77-014;
Economic Analysis of Vapor Recovery Systems on Small Bulk
Plants, EPA 340/1-77-013; Systems and Costs to Control Hydro-
Carbon 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
Estimating the probable use of 'each type of con-
trol system
Defining systems components
14-3
-------
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 annual cost
Assigning model plant costs to plants in Wisconsin
Aggregating costs to the total industry in
Wisconsin.
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.
The assignment of the estimated cost of control to
Wisconsin 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.
14-4
-------
Bulk plant throughput of gasoline nationally was
reported in Economic Analyses of Vapor Recovery Systems
on Small Bulk Plants. This profile was applied to bulk
plants in Wisconsin since no more specific data were
available.
The Wisconsin Department of Natural Resources reported
that no bulk gasoline plants currently bottom fill and that
an estimated 35 percent of the bulk gasoline plants cur-
rently top splash fill and the remaining 65 percent top
submerge fill.
No data were available on how many bulk gasoline plants
in Wisconsin are equipped with vapor control equipment.
Therefore, for purposes of this report it was assumed that
no plant is currently equipped with vapor control.
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 Wisconsin.
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
Wisconsin. 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
-------
Exhibit 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 Wisconsin 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 Wisconsin.
14.2.1 Size of the Industry
There were an estimated 1,262 bulk gasoline plants, as
of 1977, in Wisconsin. Industry sales were in the range of
$343 million, with an estimated yearly throughput of 0.807
billion gallons of gasoline. The estimated number of em-
ployees in 1977 was 5,868. These data and the sources of
information are summarized in Exhibit 14-2, on the following
page. Annual capital investments have not been estimated.
In general, bulk plant capital investments are for plant
and equipment to replace worn-out facilities, modernize the
establishments, or improve operating efficiencies.
14.2.2 Comparison of the Industry to the State Economy
A comparison of the bulk gasoline plant industry to
the economy of the State of Wisconsin is shown in this
section by comparing industry statistics to state
economic indicators. Employees in the bulk gasoline
plant industry represent 0.3 percent of the total state
civilian labor force of Wisconsin. The value of gasoline
sold from bulk plants represented less than one percent
of the total value of wholesale trade in Wisconsin.
14.2.3 Characterization of the Industry
Bulk plants are an intermediate distribution point
in the petroleum product marketing network as shown in
Exhibit 14-3, following Exhibit 14-2. Bulk gasoline plants
compete with bulk gasoline tank terminals and large retail
gasoline outlets. Ownership and operation of bulk plants
are predominantly by independent jobbers and commissioned
14-6
-------
Exhibit 14-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR BULK GASOLINE
PLANTS IN WISCONSIN
Number of Number of Sales Gasoline Sold
Establishments Employees ($ Billion, 1977) (Billions of Gallons)
1,262 a 5,868 b 0.343 C 0.807 d
a. Wisconsin Department of Natural Resources estimate. Of the 1315
bulk plants, 4 percent handle fuel oil and are excluded from the
number of affected establishments.
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 multiplied
by the national dealer tankwagon price in 1977 (42.51£/gallon)
National Petroleum News Fact Book, 1978.
d. Booz, Allen & Hamilton 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..
BULK
PLANT
v V
SMALL VOLUME
ACCOUNTS
AGRICULTURAL
COMMERCIAL
RETAIL
TERMINAL
'T
I
i
I
o
LARGE VOLUME
ACCOUNTS
RETAIL
COMMERCIAL
AGRICULTURAL
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 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 nationally.
Since no data specific to Wisconsin are available, it
is assumed (for purposes of this report) that the national
distribution characterizes bulk gasoline plants in Wisconsin.
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.l This decine is largely attributable to
major oil companies disposing of commission-agent-operated
bulk plants.
National Petroleum News Fact 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 Systems
on Small Bulk Plants, EPA, September 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 Wisconsin, 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 Wisconsin.
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 splash filling is used in about
35 percent of bulk plants and top submerged filling in the
remaining 65 percent. No bulk plants reportedly use bottom
filling in Wisconsin according to the Wisconsin Department
of Natural Resources. 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.
The facility description was synthesized from informa-
tion obtained from:
Control of Volatile Organic Emissions from
Bulk Gasoline Plants, EPA-450/2-77-035.
Stage I Vapor Recovery and Small Bulk Plants in
Washington, D.C., Baltimore, Maryland, and
Houston/Calveston, Texas, EPA-340/1-77-101
Economic Analysis of Vapor Recovery Systems on
Small Bulk Plants, EPA 340/1-77-013
Industry interviews.
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 con-
trolled by adjusting the pressure relief valve on the storage
tank.
The final major occurrence of emissions is during loading
of account trucks which dispense gasoline to bulk plant
customers. The cause of emissions during account truck
14-9
-------
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 Wisconsin in 1977. No data were
found to indicate that any bulk gasoline plant in Wisconsin
is already equipped with vapor control equipment.
Exhibit 4-5 on the following page, shows the total estimated
emissions in tons per year from bulk plants in Wisconsin.
The estimated VOC emissions from the 1,262 bulk plants are
11,849 tons per year.
It was found that 65 percent of the loading facilities
are currently equipped with submerged loading equipment,
and that approximately 35 percent of bulk gasoline plants
in Wisconsin use splash 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, following Exhibit 14-5, summarizes the RACT
guidelines for VOC emissions control from bulk gasoline
plants.
14-10
-------
Exhibit 14-5
U.S. Environmental Protection Agency
VOC EMISSIONS FROM BULK GASOLINE
PLANTS IN WISCONSIN
Number of Yearly Total Emissions
Facilities Throughput (gallons) (Tons/year)
1,262 807,000,000 11,849
Source: Booz, Allen & Hamilton Inc. estimate based on data from the
Wisconsin Department of Natural Resources.
-------
TTV rr 7" Q T ri '
Z. A n J. E J. 1 J. T ~ O
U.S. Environmental Protection Agenc
VCC EMISSION CONTROL TECHNOLOGY FO?
BULK GASOLINE PLANTS
Facilities
Affected
Bulk plants with
daily throughputs
of 76,000 liters
(20,000 gallons)
of gasoliiie or less
sources or
Emissions
Vapor displacement
from filling ac-
count trucks, and
breathing losses
and working losses
from storage tanks
HACT Control
Guideline
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.
-------
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.
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 top submerged loading
and equipping the bulk plant 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.
It is estimated that bulk plant operators in Wisconsin
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:
14-11
-------
Exhibit 14-7
U.S. Environmental Protection Agenc\
ALTERNATIVE CONTROL METHOD
FOR VAPOR CONTROL AT BULK GASOLINE PL;
Alternative Number
Description of
Control Method
Top submerge filling and
vapor balance entire system
II
Vapor balance existing
bottom filled, bulk
plant
n:
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
-------
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.
The cost for this alternative would be similar to
costs for Control Alternative I based on interviews with
equipment manufacturers.
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
-------
14.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATIONS
FOR THE MOST LIKELY RA.CT 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 projection 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 for bulk plants in Wisconsin. 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 oper-
ators 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.
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 Wisconsin that any bulk
gasoline plant in Wisconsin would be willing to implement
a system this costly. This alternative, therefore, is not
included in the projection of vapor control costs to the
statewide industry in the next section.
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
14-13
-------
Exhibit 14-8
U.S. Environmental Pro-action Agency
C^STS OF ALTERNATIVE VA.P^R CCXTRCL SY'STE"';
Alternative
Alternative
.-.iterr.ativs
Cost Estimate
(Includes ccnversi
to botton filli
National Oil
Jobbers Council
estimate
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)
Similar to costs 1 truck (4-con-
fer alternative partments)
T
1 loading rack
(3 arms)
3-inch system
Pre-set merers
Direct cost
(No labor)
Pacific Environ-
mental Services
estimate of
Houston/Gaiveston
area system
1 loading rack
Meters
Average instal-
led cost
$3,200 (without
metering)
$7,700 (with
metering)
Wiggins system
1 truck 4-com-
partments '
rre-se- meters
Source: National Oil Jobbers Council, Pacific
Environmental Services Inc., Wiggins
Division, Delaware Turbines, Inc.'
313,416
-------
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 Wisconsin can be characterized by Model Plant A;
the remaining 25 percent are assumed to be characterized
by Model Plant B.
The costs for the model plants are used in Section
14.4.3 to project 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 .
Annualized capital charges, estimated to be 25 per-
cent of installed capital costs, including costs
for depreciation, interest, maintenance, taxes,
and insurance
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 projected
to the industry.
Another cost characterization that can be made is hydro-
carbon reduction versus cost. This finding will also be
shown in the statewide analysis.
14.4.3 Projection to the Statewide Industry
Exhibit 14-10, on the following page, shows the extrap-
olation of vapor recovery costs to the statewide industry
in Wisconsin. The estimates are based on the following:
1. Control of Volatile Organic Emissions from Bulk Gasoline
Plants, EPA 450/2-77-035, p. 4-6.
14-14
-------
Exhibit 14-9
U.S. Environmental Protection Agency
DESCRIPTION AND COST CF 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 13,000 gallons/day
1 1
3 3
2 4
Alternative I
Alternative I
Bulk Plant
Costs
installed capital costa
Annualized direct operating
costs !i 3 percent of
installed cost
Annualized capital
charges '? 25 percent
of installed capital
cost
Net annualized cost
(not including gasoline
credit)
313,700
411
S,425
3,836
$19,700
4.91
a. Cost T:O modify one 4-ccmpartnent account truck estimated
to be 33,000.
Source: sooz, Allen & Hamilton, Inc.
-------
Exhibit 14-10
U.S. Environmental Protection Agenc
STATEWIDE COSTS OF VAPOR CONTROL
SYSTEMS FOR BULK GASOLINE PLANTS
Characteristic/Cost Iterr, Data
Number of facilities 1,262
Total annual throughput
(billions of gallons) 0.807
Uncontrolled emissions (current)
(tons/year) 11,849
Emission reduction3
(tons/year) 8,577
Met emissions (after control)
(tons/year) 3,272
Installed capital*3
($ million, 1977) 19.252
Direct annual operating
cost ($ million, 1977) 0-577
Annual capital charges
($-millions, 1977)
Annual gasoline creditc
($ million, 1977) 0.112
Net annualized cost
($ millions, 1377) 5'278
Annual cost per ton of
emissions reduced
(S per ten) 615
a. Emission reduction based on data in Control of Volatile Organic
Emissions from Bulk Gasoline Plants, EPA-450/2-77-035.
b. Includes cost of $66,750 to equip 442 bulk plants with a submerge
fill pipe at a cost of $150 per plant.
c. Based on 10 percent of reduced emissions remaining at bulk plant
and valued at 40C per gallon.
Source: Bocz, Allen S Hamilton, Inc.
-------
In Wisconsin, 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 vapor control system to comply with RACT.
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 $19 million. The amount of gasoline
prevented from vaporizing using vapor control is valued at
$112,000. Ten percent of total emissions can be credited
to the bulk plant since installation of vapor control equip-
ment will reduce the amount of vaporization by an estimated
10 percent. 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 and arrayed in
Exhibit 14-11. 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.
Emissions were allocated based on the estimated percentage
of statewide throughput in each throughput class. Annualized
costs were distributed for each throughput class based on
that national percentage of plants in each throughput
class.
14-15
-------
Exhibit 14-11
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL
SYSTEM BY SIZE OF BULK GASOLINE PLANT
')f
ual
luil k i'l ant (,,..,ol i in l'ciri'ciil a«jc Annual Vik I'm LSS ions Atlor Vor [ mission l.fiu ssions rstimat". d Cost For Co, 9'>'_J
O, OOO - /, 'ITJ
H,000 - 'i/j'-J')
10,000 - 11,'W4
L^ , 000 - 11, 9'J'J
M,000 - lb,4c>y
H,,000 - 1 7.» 257 3.0
V>H 1,459 17.0
1'stimaUd
Annual Cost
(5 millions, 1977)
1.151
1 . 296
. 7GH
.385
.827
.274
.071
.143
.071
. 140
I't ruent
Total Ann
Cost Ft.
V.lpol R(*c
21. Gl
24.33
14.42
7.2!
15.53
5.14
1.33
2.G8
1 .33
-------
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 not similar to a small, independently
owned bulk plant.
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 is
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 three years that are
similar to the control system implemented in the Houston/
Galveston area; thus making the delivery of RACT control eauio-
ment 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, could possibly experience
a direct cost increase of nearly 0.5 cents per gallon if they
implement RACT. This will affect an estimated 30 percent
of the bulk plants in the state and most of these plants
are believed to be 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
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.-^- 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. It is
possible that the industry decline could continue and that
some bulk plant operators may cease operations because of
their present financial condition and the additional finan-
cial 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 1.5 percent of"
the total gasoline sold in the state from bulk gasoline
plants. When compared to the statewide value of wholesale
trade, these annual cost increases are minimal. The impact
on the unit price of gasoline varies with the bulk plant
throughput. As discussed in the preceding section, the
1 Economic Analysis of Vapor Recovery Systems on Small Bulk Plants^,
EPA 340/1-77-013, September 1976.
14-18
-------
small bulk plants may experience a direct cost increase of up
to 0.25 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-
menting RACT on employment, market structure, and productiv-
ity.
For bulk gasoline plants that comply with the RACT
requirements, no additional manpower requirements are
2xpected. Overall bulk gasoline plant industrial sector
smployment may continue to decline if the number of bulk
gasoline plants operating in the state declines. Based on
the statewide estimates of number of employees and number
Df bulk plants, an average of approximately 4.6 jobs could
be lost with the closing of a bulk plant. No estimate was
nade of the number of bulk plants that may close due to RACT.
The impact of the market structure for bulk plants
iiffers significantly in urban and rural areas. The
importance of bulk plants in the urban areas may be declining
oecause of competition from retailers and tank truck terminals
and could 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
50 percent of the customers served by the small bulk plants
Ln the rural areas are farm accounts, which could be severely
impacted if many small bulk plants are forced out of business.
The increased annualized cost of complying with RACT may
create market imbalances if the compliance cost cannot be
passed on to the marketplace in terms of 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 could be threatened. Bulk plants
not equipped with vapor control equipment may not be able to
serve gasoline service stations equipped with vapor control
equipment due to incompatible hardware configurations. A
uniform policy, therefore, is necessary so that market dis-
ruptions due to equipment incompatibility 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 conrrol 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
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EXHIBIT 14-12
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR BULK GASOLINE PLANTS IN WISCONSIN
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
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
1,262
1977 industry sales were $343 million, with
annual throughput of 0.81 billion gallons.
The primary market is rural accounts
Only small percent of industry has new/modern-
ized plants
11,850 tons per year
Top submerge or bottom fill and vapor bal-
ancing (cost analysis reflects top submerged
fill, not bottom fill)
Discussion
$19.2 million
$5.27 million (approximately 1.5 percent of
industry value of shipment)
Assuming a "direct cost passthrough," $.0065
per gallon increase industrywide
Assuming full recovery of gasoline—net savings
of 58,000 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 declining
industry. Many small bulk gas plants today are
marginal operations; further cost increases
could result in plant closings
Potential severe economic impact for small bulk
plant operations. Regulation could cause
further market imbalances. Control efficiency
of cost effective alternative has not been
effectively demonstrated
3,272 tons per year (27 percent of
1977 emission level)
$615 annualized cost/annual ton of
VOC reduction
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
National Petroleum News Fact Book, 1967, 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.
Economic Analysis of Vapor Recovery Systems on Small Bulk
Plants, EPA 340/1/77-013.
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 340/1-7-014, 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.
Private conversation with Mr. William Deutsch, Illinois
Petroleum Marketers Association, Springfield, Illinois.
-------
15.0 STORAGE OF PETROLEUM
LIQUIDS IN FIXED-ROOF
TANKS IN WISCONSIN
-------
15.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR STORAGE
OF PETROLEUM LIQUIDS IN FIXED-ROOF
TANKS IN THE STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT controls for the storage of petroleum
liquids in fixed-roof tanks. The major sections of the
chapter include:
Specific methodology and quality of estimates
Technical characteristics of fixed-roof tanks and
VOC emission control technology
Profile of statewide fixed-roof tank industry
and estimated annual VOC emissions
Cost of controlling VOC emissions
Economic impact.
Each section presents detailed data and findings based
on analyses of the RACT guidelines, previous studies of
fixed-roof storage tanks, interviews and analysis.
15-1
-------
15.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining:
Technical characteristics of fixed-roof tanks
Profile of fixed-roof tanks
VOC emissions
Cost of vapor control systems
Economic impact of emission control for the storage
of petroleum liquids in fixed-roof tanks.
The quality of these estimates is discussed in the last
part of this section.
15.1.1 Technical Characteristics of Fixed-Roof Tanks
The technical characteristics of fixed-roof tanks and
processes for controlling their emissions were obtained
mainly from the RACT guideline entitled; Control of Volatile
Organic Emissions from Storage of Petroleum Liquids in Fixed-
Roof Tanks, EPA-450/2-77-036, and from several other studies
of fixed-roof tanks listed in the reference section of this
report.
15.1.2 Profile of Fixed-Roof Tanks
The Wisconsin Department of Natural Resources provided
a listing of fixed-roof tanks greater than 40,000 gallon
capacity used for storing petroleum liquids in Wisconsin
from their emissions inventory. An additional three tanks
were also reported from recent data received from District
petroleum inspectors in the Greenbay, Wisconsin area which
were not in the emissions inventory. In many cases either
tank capacity or annual throughput were missing. These
data were estimated based on 30 tank turnovers per year
based on data in a report, Benzene Emission Control Costs
in Selected Segments in the Chemical Industry.
The Wisconsin emissions inventory covers the entire
state although data for Southeastern Wisconsin, Madison,
Wisconsin and the Lake Superior area are the most complete
portions of the inventory. The remaining area of the
15-2
-------
state contains incomplete information and needs to be
verified and updated.
It is therefore determined that the fixed-roof tank
profile presented in this report is only a partial profile
of the tanks, statewide.
15.1.3 VOC Emissions
Statewide VOC emissions were calculated for petroleum
liquids stored in fixed-roof tanks in Wisconsin by using
U.S.EPA emission factors reported in Revision of Evaporative
Hydrocarbon Emission Factors, Radian Corp., August 1976.
15.1.4 Cost of Vapor Control Systems
The costs of vapor control systems were developed by:
Determining the type of control system
Developing installed capital costs for each tank
Developing total annual costs of control systems
for the number of tanks in the state including:
Installed capital cost
- Direct operating costs
Annual capital charges
Petroleum liquid credit
- Net annual cost
Aggregating costs to the total industry in
Wisconsin.
Costs were determined from analyses of the following
studies:
Control of Volatile Organic Emissions from Storage
of Petroleum Liquids in Fixed-Roof Tanks,
EPA 450/2-77-036
Benzene Emission Control Costs in Selected
Segments of the Chemical Industry, prepared for
Manufacturing Chemists Association by Booz, Allen
& Hamilton Inc., June 12, 1978
and from interviews with petroleum marketers' associations,
petrochemical manufacturers and vapor control equipment
manufacturers.
15-3
-------
15.1.5 Economic Impact of Emission Control
The economic impact of emission control for equipping
fixed-roof tanks used for storing petroleum liquids can
be determined only in terms of the statewide cost of con-
trols. Since several industries use fixed-roof tanks, eco-
nomic impacts on individual industries depend on the extent
to which the industries must bear the increased cost. The
economic impact analysis in this report is, therefore, limited
to estimating statewide costs of controls and qualitatively
assessing the potential impacts of these costs on various
industries.
15.1.6 Quality of Estimates
Several sources of information were utilized in assessing
the emissions, cost and economic impact of implementing RACT
controls for fixed-roof tanks in Wisconsin. 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" in-
dicates hard data (i.e., data that were extrapolated from
hard data); and "C" indicates data that were not available
in secondary literature and were estimated based on inter-
views, analyses of previous studies and best engineering
judgment. Exhibit 15-1, on the following page, rates each
study output listed and the overall quality of the data.
15-4
-------
Exhibit 15-1
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.
-------
lb.2 TECHNICAL CHARACTERISTICS OF FIXED-ROOF TANKS FOR STORING
PETROLEUM LIQL'IDS ' ~~
This section describes the technical characteristics of
rixed-roof tanks for storing petroleum, liquids, the sources
and types of VOC emitted by these tanks, the control
measures for reducing VOC emissions from fixed-roof tanks
and RACT Guidelines.
15.2.1 Characteristics of Fixed-Roof Tanks for Storing
Petroleum Liquids~~~
Fixed-roof tanks consist of a cylindrical steel shell
with a permanently affixed roof as characterized in Exhibit
15-2, on the following page. The roof design may vary from
cone shape to flat. The fixed-roof tank is the least expen-
sive type of storage tank to construct and is generally con-
sidered to be the minimum acceptable standard for storage of
petroleum liquids. The tank is designed to operate at only
slight internal pressure or vacuum.
Fixed-roof tanks having greater than 40,000-gallon capa-
city and containing petroleum liquids greater than 1.52 psia
are the specific fixed-roof tanks under analysis in this
report. These tanks are used for storing petroleum liquids
at refineries, bulk terminals and tank farms and ^Icna oipe-
lines. Tanks are generally loaded by submerged fill and are
unloaded into tank cars, tanK trucx.s, ships, barges or jJipeiines.
The processes of petroleum liquid storage, tank loading
and unloading are a major source of VOC emissions in Wisconsin.
Specific sources and types of emissions from such tanks are
discussed in the paragraphs which follow.
15.2.2 Sources and Types of VGC Emissions from Fixed-Roof
Storage Tanks
VOC emissions result from the process of storing petro-
leum liquids in fixed-roof storage tanks and loading and
unloading tanks with petroleum liquids. Fixed-roof tanks
are designed to operate at only slight internal pressure or
vacuum,and as a result: the emissions from storage, filling
and emptying can be appreciable.
15-5
-------
U.S. Er.viror.rier.rai Protection -.c
TYPICAL FIXED ROOF TANK
Thief Hatch
-Vent
\
Nozzle
For submerged fil 1
or drainage)
Source; Regulatory Guidance for Control of Volatile Organic Compound
Emissions from 15 Categories of Stationary Sourcas_,
EPA-905/2-78-001, U.S. Environmental Protection Agency, April 1978
-------
15.2.2.1 Emissions from Petroleum Liquid Storage
Emissions from petroleum liquid storage, referred to
as breathing losses, occur from changes in temperature and
pressure in the storage tank. Vapors are expelled from
the tank when diurnal temperature and barometric pressure
changes cause expansion and contraction of the volatile
petroleum liquid. These VOC emissions or losses occur in
the absence of any liquid level change in the tank.
Breather valves (pressure vacuum) are installed on many
fixed-roof tanks to prevent vapors from escaping to the
atmosphere because of small changes in temperature and
barometric pressure or very small fluctuations in liquid
level. These vents, however, will vent vapors to the
atmosphere during normal filling and draw air into the tank
during emptying.
15.2.2.2 VOC Emissions from Filling and Emptying Storage
Tanks
VOC emissions resulting from filling and emptying storage
tanks are referred to as "working losses." As a tank is filled
the vapor laden air in the airspace between the liquid and the
tank top is displaced to the atmosphere through breather vents.
Emptying losses occur when air drawn into the tank through
the breather vent becomes saturated with hydrocarbon vapor and
expands such that the volume of the vapor laden air exceeds
the capacity of the vapor space.
Additional VOC emissions occur during tank cleaning
and from any corrosion spots or deterioration in the tank.
15.2.3 Techniques for VOC Emission Control
Fixed-roof tank emissions are most readily controlled by
the installation of internal floating roofs. An internal
floating roof for fixed-roof tanks is a cover floating on
the liquid surface inside the tank, rising and falling with
the liquid level. Exhibit 15-3, on the following page, is a
schematic of a typical fixed-roof tank equipped with an
internal floating roof or cover. There are two types of
internal floating roofs:
A pan-type steel floating roof
A nonferrcus floating roof made of aluminum or
polyurethane.
15-6
-------
U.S. Envi roiimeiii-ci I protection Aqoncy
SCHEMATIC OF TYPICAL F1XEU ROOK TANK
WITH INTERNAL FLOATING COVER
.XYnler Vent
Au.^ matic
Tank Gauge Piping
Step on Thief llalch
l-ocaieil Over Sample Well
Opiionnl Overflow Venl
d C»lile Ro»f AlUK liitn-nt
Anti-Itotatiun Kw>f Fitting
Penpheral ituof Vent/
ll^t< h
," « S S Oruunil CMe,
Automatic G'uigo Klo»t Well —
S«niple Well
Shell MitnMray
Roof to
Shell Sea'
Anti-ftutation Cable Passen
Through Kitting Uoltitl to Film 1'l.ite
Rim Pontouna
Anti Holatlun I.ug Welded to Floor
Tank Supijort Column with Column \Vi-ll
ftlm Puntbiinn ^
Cover
Vniutim llrcakt*r and Actuator Leg
Source: Regulatory Guidance for Control of Volatile Organic Com}x>und Emissions from 15
-.ate^ories Qf stationary Sources, EPA-905/2-78-001, U.S. Environmental Protection
Agency, April 1978
-------
The fixed-roof protects the internal floating roof and
seal from deterioration from climatological effects and
eliminates the possibility of the floating roof sinking from
the weight of rain or snow loads.
A closure device must be used to seal the gap between
the tank shell and the internal floating roof around the roof
perimeter. Special materials are available for the closure
device in a wide range of designs to accommodate the entire
spectrum of petroleum liquids. Exhibit 15-4, on the following
page, illustrates several typical internal floating roofs and
perimeter closure seals.
Other modifications may need to be made to the fixed-
roof tank before it is equipped with an internal floating roof.
Tank shell deformations and obstructions may require correc-
tion; special structural modifications such as bracing, re-
inforcing and plumbing vertical columns may be necessary.
Anti-rotational guides should be installed to keep the in-
ternal floating roof openings in alignment with the fixed-
roof openings. Special vents are installed on the fixed
_roof or on the walls at the top of the .shell to minimize
the possibility of VOCs approaching the flammable range in
the vapor space.
15.2.4 RACT Guideline for VOC Emission Control
The RACT guidelines call for installation of an internal
floating roof for fixed-roof tanks storing greater than
40,000 gallons of petroleum liquids with a true vapor pressure
that exceeds 1.52 psia. The_guidelines do not apply to
storage tanks equipped with external ^floating roofs or to storage
tanks having capacities less than 416,000 gallons used to
store crude oil and condensate prior to lease custody trans-
fer.
It is expected that the State of Wisconsin will prepare
legislation for the storage of petroleum liquids which is
modeled after the RACT auidelines.
"Custody transfer" means the transfer of produced crude oil and/or
condensate, after processing and/or treating in the production
operations, from storage tanks or automatic transfer facilities
to pipelines or any other forms of transportation.
15-7
-------
Exhibit 15-4
U.S. Environmental Protection Agency
TYPICAL FLOTATION DEVICES AND PERIMETER SEALS
FOR INTERNAL FLOATING COVERS, AND
COVERED FLOATING ROOF
Aluminum deck supported above
liquid by tubular aluminum pontoons
Elastomer wiper seal
>
/ ~-~^
•-ll_y
L
y
i i
r "\ Note: v = vapoV
V / L = liquid
\
\\ Pontoon
Mo-hal c Cia 1 y»nnn
Deck
)
6
\. Pontoon
Tank shell
Aluminum sandwich panels" with honeycombed
aluminum core floating on surface
Sanwich~paneTr
7
v L
Foam filled coated fabric
Foam filled
/ coated fabric
Steel pan
7
Source: Based on Annex A, API Publication 2519, Second Edition
-------
15.3 PROFILE OF FIXED-ROOF TANKS FOR STORING PETROLEUM
LIQUIDS AND ESTIMATED VOC EMISSIONS
This section contains a profile of fixed-roof tanks
used for storing petroleum liquids in the State of Wisconsin
and the estimated annual VOC emissions from these tanks.
The Wisconsin Department of Natural Resources compiled
a list of fixed-roof tanks from their emissions inventory
and from data obtained from District petroleum inspectors.
The capacity of each tank and the type of petroleum liquid
stored were provided. In summary, there are approximately
11 fixed-roof tanks greater than 40,000 gallon capacity
(storing petroleum liquids subject to the RACT limitations)
and not equipped with an internal floating roof in Wisconsin.
The total storage capacity of these tanks is estimated to
be 22 million gallons and the annual throughput of petroleum
liquid is estimated to be 707.7 million gallons.
It is estimated that annual VOC emissions from the
storage of petroleum liquids in fixed-roof tanks in Wisconsin
are 4,452 tons per year.
It is further estimated that these emissions could be
reduced by 90 percent or to 445 tons per year by imple-
menting RACT in Wisconsin.
15-8
-------
15.4 COST OF CONTROLLING VOC EMISSIONS
This section presents a cost analysis of equipping
fixed-roof tanks used for storing petroleum liquids with
internal floating roofs as a means for controlling VOC
emissions.
The costs for emission control equipment include:
Installed capital cost, including parts and
labor
Annual capital charges, estimated to be 25 percent
of installed capital cost and including costs for
depreciation, interest, maintenance, taxes and
insurance
Annualized direct operating costs, estimated to be
2 percent of installed capital cost and including
costs for inspection and recordkeeping
Annual petroleum liquid credit calculated by
multiplying emission reduction by the volume of
the petroleum liquid divided by the liquid density
Net annualized costs, the sum of the capital
charges and direct operating costs less the
petroleum liquid credit.
Capital costs were determined for each tank from the graph
in Exhibit 15-5, on the following page. This graph was pre-
pared by Eooz, Allen based on interviews with petroleum
refineries, petrochemical manufacturers, tank manufacturers
and emission control equipment manufacturers. Total
installed capital cost, including labor, is two times the
value given on the graph. All costs are for 1977.
A summary of the cost aggregated statewide from the
emission control of petroleum liquids stored in fixed-roof
tanks is shown in Exhibit 15-6, following Exhibit 15-5.
The total installed capital costs for equipping the 11
fixed-roof tanks in Wisconsin with internal floating roofs
exceeds $2 million. The net annualized cost is approximately
$65,800 at a cost of $16 Per ton of emissions reduced
15-9
-------
Exhibit 15-5
. Environmental Protection Agency
INSTALLED COST CF SINGLE SEAL
FLOATING ROOF TANKS
(Prices Approximate)
CAPACITY OP TANK
Source: Communications with Ultra-Float Inc., Booz, Allen & Hamilton
Inc. analysis
-------
Exhibit 15-6
U.S. Environmental Protection Agency
VOC EMISSIONS CONTROL COSTS FOR
STORAGE OF PETROLEUM LIQUIDS IN
FIXED-ROOF TANKS IN WISCONSIN
SUMMARY OF COSTS
Number of tanks 11
Total capacity 22.128
(millions of gallons)
Estimated annual throughput 707.7
(billions of gallons)
Uncontrolled emissions 4,452
(tons per year)
Emissions reduction 4,008
(tons per year)
VOC emissions after RACT 445
(tons per year)
Installed capital cost 2.14
($, millions, 1977)
Annualized capital charges 0.535
($, millions, 1977)
Annualized direct operating costs Q Q^
($, thousands, 1977)
Annual petroleum credit 0.512a
($, millions, 1977)
Net annualized cost 0.066
($, millions, 1977)
Annualized cost per ton of 16
emissions reduced ($, 1977)
a. Assume value of petroleum liquid saved
is $.39 per gallon and density of
petroleum liquid is 6.1 Ibs. per gallon.
Source: Booz, Allen & Hamilton Inc.
-------
15. 5 ECONOMIC IMPACT
This section discusses the economic impact of equipping
fixed-roof tanks used for storing petroleum liquids with in-
ternal floating roof to control VOC emissions. The impacts
analyzed include: total cost statewide; identification of
industries that may be affected and their ability to raise
the capital needed for the controls; and effects on employ-
ment, productivity and market structure.
Total Cost in Wisconsin—An estimated $2.14
million will be required statewide in Wisconsin
to equip fixed-roof tanks for storing petroleum
liquids with internal floating roofs. This
represents approximately 0.77 percent of the
value of petroleum liquid throughput from
uncontrolled fixed-roof tanks in Wisconsin.
Industries affected—Fixed-roof tanks, greater
than 40,000 gallons, used for storing petroleum
liquids are owned by major oil companies, large
petrochemical firms and bulk gasoline tank
terminal companies. It is expected that these
companies will be able to meet the capital
requirements.
Employement—No change in employment is expected
from the implementation of RACT.
Productivity—No change in worker productivity is
expected to result from the implementation of RACT.
Market structure—No change in market structure is
expected to result from the implementation of RACT.
Exhibit 15-7 on the following page presents a summary
of the findings of this report
15-10
-------
EXHIBIT 15-7
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR STORAGE OF PETROLEUM LIQUIDS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected
storage tanks
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
Actual 1977 VOC emissions
Preferred method of VOC control to
meet RACT guidelines
Discussion
11
The annual throughput was an estimated
707.7 million gallons
Internal floating roof tanks utilizing
a double seal have been proven to be
more cost effective
4,452 tons per year
Single seal and internal floating roof
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$2.14 million
$66,000
Assuming a "direct cost passthrough"
—less than 0.1 cents per gallon of
throughput
Assuming 90 percent reduction of current
VOC level, the net energy savings repre-
sent an estimated savings of 27,377
equivalent barrels of oil annually
No major impact
No major impact
No major impact
Potential availability of equipment to
implement RACT standard
445 tons per year (10 percent of 1977
emission level)
S16 annualized cost/annual ton of VOC
reduction
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
Benzene Emission Control Costs in Selected Segments of the
Chemical Industry, prepared for Manufacturing Chemists
Association by Booz, Allen & Hamilton Inc., June 12, 1978.
Control of Volatile Organic Emissions from Storage of
Petroleum Liquids in Fixed-Roof Tanks, SPA-450/2-77-036,
U.S. Environmental Protection Agency, December 1977.
Regulatory Guidance for Control of Volatile Organic Com-
pound Emissions from 15 Categories of Stationary Sources,
EPA-905/2-78-001, U.S. Environmental Protection Agency,
April 1978.
Revision of Evaporative Hydrocarbon Emissions, PB-267 659,
Radian "CorpY",August 1976.
-------
16.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT STAGE I
FOR GASOLINE SERVICE STATIONS
IN THE STATE OF WISCONSIN
-------
16.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT STAGE I
FOR GASOLINE SERVICE STATIONS
IN THE STATE OF WISCONSIN
This chapter presents a detailed analysis of implement-
ing RACT Stage I controls for gasoline service stations
in the State of Wisconsin. 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
analvsis.
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 Wisconsin.
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 reported in National
Petroleum News Factbook, 1978. The number of "non-
service 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.1
The number of employees in 1977 was determined by multiply-
ing the national average number of employees per service
station (3.5) by the number of establishments in the state
which was reported by 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. 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 (50.7£/gallon) which was also
reported in the National Petroleum News Factbook, 1978.
16.1.2 VOC Emissions
Emissions from gasoline dispensing facilities (including
emissions from underground tank breathing, underground tank
filling, vehicle refueling and spillage) in Wisconsin were
Prepared for the Department of Labor, OSHA, C79911, March
1978, pp. 4-7.
16-2
-------
calculated by multiplying emission factors by gasoline through-
put statewide. The emission factors were reported in
Hydrocarbon Control Strategies for Gasoline Marketing
Operations, EPA-450/3-78-017, April 1978. It was estimated,
based on interviews, that 90 percent of the gasoline dis-
pensing facilities in Wisconsin currently employ submerge
filling of gasoline storage tanks and the remaining 10
percent employ splash fill.
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 emissions 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 Wisconsin. The specific studies analyzed
were: Economic Impact of Stage II Vapor Recovery Regula-
tions; Working Memoranda, EPA-450/3-76-042; A Study of
Vapor Control Methods for Gasoline Marketing Operations,
PB-246-088, 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 annualized cost
Aggregating costs to the statewide gasoline
service station industry.
16-3
-------
Costs were determined from analyses of the studies
listed previously and from interviews with petroleum marketers'
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 information from industry
interviews. Costs for the two systems are assumed to be
represented by the costs developed for the model service
station. Statewide costs were projected 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.
-------
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, an
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 Wisconsin.
16.2.1 Size of Industry
There were an estimated 4,213 gasoline service stations
in Wisconsin in 1977, and an additional estimated 5,771 "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
$1.10 billion with a yearly throughput of 2.354 billion
gallons of gasoline. The estimated number of employees
in 1977 was 14,700 employees in service stations and
11,542 employees in "non-service stations" for a total
of 26,200 employees. These data and the sources of informa-
tion are summarized in Exhibit 16-2, on the following page.
Total capital investments by the service station industry
were not identified, although in general gasoline service
station operators make investments in plant and equipment
to replace worn-out facilities and equipment, modernize the
establishments or improve operating efficiencies.
16.2.2 Comparison of Industry to State Economy
The gasoline service station industry is compared to
the economy of the State of Wisconsin in this section by
comparing industry statistics to state economic indicators.
Employees in the gasoline service station industry represent
approximately 1 percent of the total state civilian labor
force of Wisconsin. The value of gasoline sold from gasoline
service stations represented 5 percent of the total value of
retail trade in Wisconsin in 1977.
16-5
-------
Exhibit 16-2
U.S. Environmental Protection Agency
INDUSTRY STATISTICS FOR GASOLINE
SERVICE STATIONS IN WISCONSIN
Number of Facilities
Number of Employees
Service Non-Service Service Non-Service
Stations Stations Stations Stations
4,213
5,771"
14,700
11,542
Sales
;$Billion, 1977)
1.193e
Gasoline Sold
(Billions of Gallons)
2.354f
a. National Petroleum News Fact Book, 1978.
b. Includes gasoline dispensing facilities such as marinas, general aviation
facilities, commercial and industrial gasoline consumers and rural
operations with gas pumps.
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 Factbogk, 1978, p. 78.
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 stations 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.
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 Wisconsin and
is predicted to continue. It is estimated that, by 1980,
one-half the gasoline stations in the country will be totally
self-service.
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"
Economic Impact of Stage II Vapor Recovery Regulations; Working
Memoranda, EPA-450/3-76-042, November 1976, p. 6.
Ibid., p. 2.
16-6
-------
Exhibit 16-3
U.S. Environmental Protection Agency
GASOLINE DISTRIBUTION NETWORK
REFINERY
V
BULK
PLANT
v V
TERMINAL
V
\/
LARGE VOLUME
ACCOUNTS
RETAIL
COMMERCIAL
AGRICULTURAL
A
•l«
SMALL
VOLUME
ACCOUNTS
AGRICULTURAL
COMMERCIAL
RETAIL
o
CUSTOMER
PICK-UP
O
•^—• « -^H - .
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 340/1-77-013, p. 3-2.
-------
Exhibit 16-4
U.S. Environmental Protection Agency
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
-------
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
Wisconsin 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
control in use, the vapor control requirements of RACT and
the likely alternatives which may be used for controlling
VOC emissions from service stations in Wisconsin.
16.3.1 Gasoline Service Station Operations
Gasoline service stations are the final distribution
point in the gasoline marketing network. Gasoline is de-
livered 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 dis-
pensed 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 re-
maining 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.
16.3.1.1 Facilities
Equipment at gasoline dispensing facilities used in
handling gasoline 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 based on informa-
tion in Hydrocarbon Control Strategies for Gasoline Marketing
Operations, p. 2-17. 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 sub-
sequent storage in underground tanks.
16-8
-------
16.3.1.3 Operations
Uncontrolled VOC emissions at service stations come from
loading and unloading losses from tank trucks and underground
tanks, refueling losses from vehicle tanks and breathing
losses from the underground tank vent. Stage I vapor control
applies to 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 more emissions than submerged loading.
More specifically, losses occur when:
Organic liquids vaporize into the air that is
drawn into the tank truck compartment during
unloading of the tank truck.
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
available 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 Wisconsin in 1977 and the cur-
rent level of -emission control already implemented in the
state. Exhibit 16-5, on the following page, shows the total
estimated emissions in tons per year from gasoline service
stations in Wisconsin. Emissions, based on gasoline through-
put, are estimated to be 21,680 tons per year. Emissions
include emissions from underground tank breathing, underground
tank filling, vehicle refueling and spillage.
16-9
-------
Exhibit 16-5
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)
9,984 2,354 21,680
Source: Booz, Allen & Hamilton Inc.
-------
It was assumed that 90 percent of storage tank loading
was by the submerged fill method based on industry interviews.
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.
Exhibit 16-6, 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 alterna-
tive 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
connection (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 16-7, fol-
lowing Exhibit 16-6, 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 16-8, employs a concentric
liquid vapor return line, thus requiring only one tank riser.
16-10
-------
Exhibit 16-6
U.S. Environmental Protection Agenc
VOC EMISSION CONTROL TECHNOLOGY FO.
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
fillingr and submerge
filling
Source: Design Criteria for Stage I Vapor Control Systems,
Gasoline Service Stations, U.S. EPA, November 1975.
-------
Exhibit 16-7
U.S. Environmental Protection Agency
STAGE I VAPOR CONTROL SYSTEM -
VAPOR BALANCING WITH SEPARATE LIQUID-VAPOR RISE]
Cc:.p.ll lu.-nt
Vent Valves
r
Orifice or P-V Vjlve
Unless Pro.cd.
V
-------
Exhibit 16-8
U.S. Environmental Protection Agency
STAGE I VAPOR CONTROL SYSTEM -
7APOR BALANCING WITH CONCENTRIC LIQUID-VAPOR RISi
or P-V
Product and
Vapor U:por Ulancing .ith
r.Cu itric ilq-id - vipor
riser.
Source: Design Criteria for Stage I Vapor Control Systems Gasoline
Service Stations, U.S. EPA, November 1975
-------
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
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 with RACT requirements.
It is estimated based on industry interviews that 25 percent
of the service stations would install the two point system,
bearing a higher cost but achieving greater efficiency.
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 16-8, 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
16-11
-------
storage tank fill rates to some extent. It is estimated
based on industry interviews that 75 percent of the gasoline
service stations would install 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 manifolded piping
system, care must be exercised to prevent contamination of
"no-lead" gasoline products.
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 ex-
tending 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.
16-12
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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 aasoline service
station in Exhibit 16-9, on the following page. The cost of
Stage I vapor control for a typical service station of 44,000
gallons per month throughput has been estimated as follows.
Capital costs of installing the two point vapor-balancing
equipment at existing service stations are about $2,000 per
station. This cost includes equipment costs ($300-$500) and
installation ($1,300-$!,600). The installed capital cost
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 in-
stalled capital cost and include interest, depreciation,
taxes and maintenance. This cost analysis does not consider
the cost of tank truck modifications. 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 will be included
in the statewide costs in the next section. The net
annualized cost for a typical gasoline service station
with 44,000 gallons per month throughput is estimated
to be $500 for the two point system and $150 for the
concentric or coaxial system.
Air Pollution Control Technology Applicable to 26 Sources of
Organic Compounds, U.S. Environmental Protection Agency, May 27,
1977. (This cost includes excavation and construction of mani-
folded storage tanks.)
16-13
-------
Exhibit 16-9
U.S. Environmental Protection Agency
STAGE I VAPOR CONTROL COSTS FOR A
TYPICAL GASOLINE SERVICE STATION
Description of Model Gasoline Station
Monthly throughput (gallons) 40,000
Number of storage tanks 3
Costs
($, 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, in-
surance and maintenance
Source: Booz, Allen & Hamilton Inc.
-------
16.4.2 Extrapolation to the Statewide Industry
This section presents an extrapolation of vapor control
costs to the statewide industry. An estimated 21 service sta-
tions and 2,077 non-service stations may be exempted from the
Wisconsin 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
Industry, p. 47.
Exhibit 16-10, 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 be $7,490,000. The
amount of gasoline prevented from vaporizing using sub-
merged filling of gasoline storage tank is valued at
$82,000. The annual cost per ton of emissions controlled
is estimated to be $215 per ton.
The distribution of the statewide costs and emissions
reduction by the size of gasoline service stations based
on throughput is shown in Exhibit 16-11, following Exhibit
16-10. Based on these data, gasoline service stations with
throughput less than 24,000 gallons per month account for
45 percent of the estimated statewide cost of control but
only 23 percent of the estimated emissions reduction from
gasoline service stations.
16-14
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Exhibit 16-10
U.S. Environmental Protection Agency
STATEWIDE COSTS FOR STAGE I VAPOR
CONTROL OF GASOLINE SERVICE STATIONS
Summary of Costs
Number of affected facilities 7,886
Estimated annual throughput from 2.228
affected facilities3
(billions of gallons)
Uncontrolled emissions 21,680
(tons/year)
Emissions reduction13 8,293
(tons/year)
Emissions after RACT 13,387
control (tons/year)
Installed capital costs 7.49
($ millions)
Annual capital costs 1.87
($ millions)
Annual gasoline creditc 0.082
($ millions)
Net annualized cost 1.788
($ millions)
Net annualized cost 215
per ton of emissions
reduced
($ per ton/year)
a. Total annual throughput adjusted to exclude potentially exempted
facilities.
b. Emission reduction based on reducing emissions from tank filling
by employing submerge filling and vapor balancing.
c. Gasoline credit calculated based on converting from splash fill
to submerged fill and gasoline valued at $0.507 per gallon.
Source: Booz, Allen & Hamilton, Inc.
-------
Exhibit 16-11
U.S. Environmental Protection Agency
STATEWIDE COSTS OF VAPOR CONTROL
SYSTEMS BY SIZE OF GASOLINE
DISPENSING FACILITY IN OHIO
Gasoline Dispensing Percentage3
Facility Throughput of Facilities
(000 gallons per month)
10 4.5
11-24 40.7
25-49 31.2
50-99 18.7
100 4.9
Current Estimated
Percentage3 Annual
of Volume VOC Emissions
(tons per year)
1 217
22 4,769
JO 6,504
33 7,154
14 3,035
Estimated
Annual VOC
Emission After
RACT Control
(tons per year)
129
2,848
3,884
4,272
1,812
Net Hydro-
Net VOC Percentage of Percentage carbon Control
Emission Total VOC Estimated of Total Cost Kffec-
Reduction Emissions Reduced Annual Cost Annual Cost tiveness
(tons per year)
88 1
1,921 22
2,620 30
2,882 33
1,223 14
($,
0.
0.
0.
0.
0.
millions,
1977)
103 4.5
931 40.7
.714 31.2
.428 18.7
.112 4.9
( S, 1977
tons per
1,170
484
272
148
91
year)
a. The Economic Impact of Vapor Recovery Regulations on the Service
St-at-inn TnHna-l-i-\7 r-i "3 O
Station Industry, p. 32.
Source: Booz, Allen & Hamilton Inc.
-------
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 sufficent 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 equipment available for the implementation of Stage
I RACT.
16-15
-------
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 may
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
from the oil company's capital budget.
It is estimated that small gasoline service stations x^ith
throughput less than 10,000 gallons per month (which represent
approximately 4.5 percent of the service stations in the state)
could 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 may experience a
much smaller cost increase. For example, service stations
in the Washington, B.C. area have been required to implement
Stage I and II vapor control.
This could put the smaller stations at a competitive
disadvantage in terms of passing on the costs to the
customers by raising prices. Recent experience indicates
that temporary disruptions resulting from Stage I RACT
control installation can have serious impacts on the ser-
vice 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 in-
stalled. .Service station driveways were torn up, greatly
1 Economic Impact of Stage II Vapor Recovery Regulations: Working
Memoranda, EPA-450/3-76-042, November 1976.
16-16
-------
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 may 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 this
trend as marginal operations may opt not to invest in the re-
quired capital costs. Sufficient data for this state are not
available 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 approximately
0.15 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.
16-17
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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 signif-
icantly 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 station is
predicted to increase.
The productivity impact on a specific service station
operation is expected to be slight. Fill rates for loading
gasoline storage tanks may slightly decline if coaxial or
concentric vapor hose connections are used.
Exhibit 16-12, on the following page, presents a summary
of the findings of this report.
16-18
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EXHIBIT 16-12
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTING RACT FOR GASOLINE SERVICE STATIONS
IN THE STATE OF WISCONSIN
Current Situation
Number of potentially affected
facilities
Indication of relative importance
of industrial section to state
economy
Current industry technology trends
Actual 1977 VOC emissions
Preferred method of VOC control to
meet RACT guidelines
Discussion
Approximately 7,900 gasoline dispensing
facilities
Industry sales are $1.193 billion with a yearly
throughput of 2.354 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
21,680 tons per year from all station operation
Submerged fill and vapor balance
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
$7.49 million
$1.79 million (.approximately 0.15 percent of
the value of gasoline sold)
Assuming a "direct cost pass-through"—
less than $0.001 per gallon increase
Assuming full recovery of gasoline—net
savings of 56,600 barrels annually
No major impact
No major impact
Compliance requirements may accelerate the
industry trend towards high throughput stations
(i.e., marginal operations may opt to cease
operations)
Older stations face higher retrofit costs—
potential concerns are dislocations during
installations
13,387 tons per year from all station operation
(61 percent of 1977 emission level)
$215 annualized cost/annual ton of VOC reduction
Source: Booz, Allen & Hamilton Inc.
-------
BIBLIOGRAPHY
Economic Impact of Stage II Vapor Recovery Regulations^
Working Memoranda, EPA-450/3-76-042, November 1976.
National Petroleum News Fact Book/ 1978, McGraw Hill,
Mid-June 1978.
Cost Data-Vapor Recovery Systems at Service Stations/
PB-248 353, September 1975.
Human Exposure to Atmospheric Benzene, 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 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.
-------
17.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
USE OF CUTBACK ASPHALT
IN THE STATE OF WISCONSIN
-------
17.0 THE ECONOMIC IMPACT OF
IMPLEMENTING RACT FOR
USE OF CUTBACK ASPHALT
IN THE STATE OF WISCONSIN
This chapter presents a detailed analysis of the impact
of implementing RACT for use of cutback asphalt in the State
of Wisconsin. 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
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
-------
17.1 SPECIFIC METHODOLOGY AND QUALITY OF ESTIMATES
This section describes the methodology for determining
estimates of:
Industry statistics
VOC emissions
Process for controlling VOC emissions
Cost of controlling VOC emissions
Economic impact of emission control
for the use of cutback asphalt in Wisconsin.
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
Wisconsin 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 described 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 emulsion in place of cutback
1 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 implications. 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
-------
Exhibit 17-1
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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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
Wisconsin.
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 how
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, primarily
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 appears 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 Wisconsin. Although some cutback asphalt
may be produced in Wisconsin, the production industry is not
the focus of this study since RACT requires control of the
use of cutback asphalt. An estimated 183,000 tons of cut-
back asphalt were purchased in Wisconsin in 1977 at a value
of $16.8 million. The value is based on an estimated average
price per gallon of $0.36.
Cutback asphalt is primarily used in paving in Wisconsin.
The number of employees involved in cutback asphalt pavinq
operations in Wisconsin 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 17-2
U.S. Environmental Protection Agen<
PETROLEUM ASPHALT FLOW CHART
on
PETROLEUM ASPHALT FLOW CHART
PROCESSING
HELD STORAGE. PUMfING STATION
GASOLINE
UGMT SOLVENTS
KEROSENE
tIGHT 1URNE1 OIL
DIESEl OIL
IUM1CATING OH!
|| This simplified graphic chart shows
the inter-relationships of petroleum RESIDUAL
[•—| products, with gasoline, oil and
—-' asphalt flowing from the same oil
=31 well.
Alt
STIll
AH
BLOWN
ASPHALTS
GAS
PfTIOLEUM
SAND AND WATER
tlfNOEl
BLENDER
SLENDER
DECEMBER 1968
WATER oaeM,?A5N?N
ASPHALT CIMIMTS
HOW CUIINO
IIOUIO ASPMAUS
AND »OAO OUS
(MAT ALSO 8f
PtEMIED IY DltECT
CMSTIILATICN)
MIO4UM CUtlMO
LIQUID ASPHALT}
»APIO CUKINO
LIQUID ASPMAtTS
IMUISIMID ASPHALTS
CUTBACK
ASPHALT
Source.; The Asphalt Institute
-------
17.2.3 Comparison to Statewide Economy
The value of shipments of cutback asphalt to the
statewide value of wholesale trade in Wisconsin is approx-
imately 0.01 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.
The comparison between cutbacks and emulsions is some-
what different when one looks at quantity requirements.
Though technically interchangeable in many applications,
it is typically the case that more emulsion must be applied
than cutback for an identical task. This is because emul-
sions have a lower asphalt content than cutbacks on a per
gallon basis. Estimates on quantity conversions (substi-
tutability) range from one-to-one to one-to-two in favor
of cutbacks depending on the type of emulsion and the given
application. However, in terms of average cost of usage,
currently, price and quantity differentials tend to be
offsettincr. Thus the cost of usage should be approximately
the same.1
Interview materials from the Asphalt Institute, College Park,
Maryland. Contention that the price per mile of emulsions is
cheaper than oil based asphalts that are currently being made.
Though true, the contention is misleading because the comparison
is between hot mix asphalts and emulsions in overlay applications.
Cutbacks are not used in overlay applications.
17-6
-------
Exhibit 17-3
U.S. Environmental Protection Agency
HISTORICAL NATIONAL SALES OF ASPHALT CEMENT,
CUTBACK ASPHALT AND ASPHALT EMULSIONS
YEAR
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
72.7
73.8
74.2
74.8
77.4
75.7
75.3
(000 of tons)
4,096
3,994
3,860
4,220
3,359
3,072
3,038
17.4
16.7
15.9
15.6
13.6
14.2
14.2
(000 of tons
2,341
2,275
2,399
2,585
2,208
2,197
2,254
9.9
9.5
9.9
9.6
9.0
10.1
10.5
23,594
23,821
24,305
27,040
24,642
21,593
21,474
Source: U.S. Bureau of Mines
-------
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 Wisconsin.
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 resistant. 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 of
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
-------
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 Wisconsin, cutback asphalt is used
in construction and maintenance of secondary roads throughout
the state.
17-9
-------
It is the petroleum distillate (diluent) in the cutback
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 asphalt,
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 previ-
ously.
17.3.5 VOC Emission Control Procedure for Wisconsin
The State of Wisconsin is preparing draft legislation
on the use of cutback asphalt which will be modeled after
the RACT guidelines.
17.3.6 Statewide Emissions
Total emissions from the use of cutback asphalt in
Wisconsin for 1977 are estimated at 27,200 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 17-4
U.S. Environmental Protection Agency
ESTIMATED HYDROCARBON EMISSIONS FROM THE
USE OF CUTBACK ASPHALT IN WISCONSIN
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
35 65 83 7.1 13.6 6.5 27.2
]977 sales were assumed to equal 1976.
Source: Mineral Industries Surveys, 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
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17.4 COST AND HYDROCARBON REDUCTION BENEFIT EVALUATIONS 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 Wisconsin.
Costs to users of cutback asphalt who must convert to
emulsions are primarily those expenditures associated with
retraining personnel and making minor equipment modifications.
The existing price/gallon advantage accruing to emulsions
is approximately offset by the quantity advantage accruing
to cutbacks (in terms of required asphalt content and com-
parative durability). Put differently, expenditures on
materials should remain approximately constant, but those
on capital and labor should increase as users convert to
asphalt emulsions. The most significant cost to the user
will be for retraining personnel in the methods of asphalt
emulsion application. It is estimated that those 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.
17-12
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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.
17.4.2 Extrapolation to the Statewide Industry
The total costs to Wisconsin for converting from using
cutback asphalt to using asphalt emulsions are estimated at
$162,000 and the cost per ton of hydrocarbon emissions re-
duced is estimated at $6, assuming all cutbacks could be
replaced with emulsions. Annualized costs are negligible,
since minor equipment costs and retraining costs are not
capitalized. A summary of these costs is given in Exhibit
17-5, on the following page.
By way of comparison, highway and street construction
costs for all government systems in Wisconsin for 1976
:
Capital outlay - $298 million
Maintenance - $206 million
Administration - $35 million.
1. Federal Highway Administration, Office of Highway Statistics,
Table HF-2.
17-13
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Exhibit 17-5
U.S. Environmental Protection Agaric
STATEWIDE COSTS FOR RACT
FOR USE OF CUTBACK ASPHALT
Direct Cost Summary
Cutback asphalt used 183
(thousands of tons)
Potential emissions a 27,200
reduction from converting
to use of asphalt
emulsions
(tons per year)
Retraining costsb $129,600
Equipment modification costsc $ 32,400
Total one-time costs $162,000
One-time costs per ton of $ 6
emissions reduced
Annualized cost per ton $ 0
of emission reduced
a. No estimate was available of the current use of cutback asphalt
that might be exempted under the RACT Guidelines fin other states
this estimate ranged from 20 to 80 percent of the current cutback
asphalt consumption).
b. Cost based on retraining six employees per county
c. Cost based on modifying three distributor trucks per county.
Source: Booz, Allen & Hamilton Inc.
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17.5 ECONOMIC IMPACTS
This section presents a discussion of the economic
impacts and the technical feasibility of implementing RACT
for the use of cutback asphalt in Wisconsin. 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 cut-
back 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 Wisconsin, has con-
verted 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 i
employment; on productivity; and on market structure.
The overall economic impact of implementing RACT for
use of cutback asphalt in Wisconsin is estimated to be minimal.
Specific economic impacts include impacts on:
Cost—The estimated one-time cost of $162,000
distributed over 72 counties in Wisconsin is small
compared to the total statewide cost of highway
construction.
Price—The prices of cutack 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 adeuqate supply of asphalt
emulsion to meet the increased demand in Wisconsin.
Employment—No change in employment is predicted
from implementing RACT, although it will be neces-
sary to train approximately 432 employees in Wis-
consin in the use of asphalt emulsions.
Productivity—Worker productivity is not expected
to be substantially affected 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, on the following page, presents a
summary of the findings of this report.
17-15
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Exhibit 17-6 (1)
U.S. Environmental Protection Agency
SUMMARY OF DIRECT ECONOMIC IMPLICATIONS OF
IMPLEMENTATING RACT FOR USE OF CUTBACK ASPHALT
IN THE STATE OF WISCONSIN
Current Situation
Use potentially affected
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
In 1977, estimated use of cutback asphalt
was 183,000 tonsa
1977 sales of cutback asphalt were
estimated to be $16.8 million
Nationally, use of cutback asphalt has
been declining
27,200 tons annually
Replace with asphalt emulsions
Affected Areas in Meeting RACT
Capital investment (statewide)
Annualized cost (statewide)
Price
Energy
Productivity
Employment
Market structure
Problem area
Discussion
$0.2 million
No change in paving costs is expected
No change in pavings costs is expected
No major impact to the user13
No major impact
No major impact
No major impact
Winter paving
Short range supply of asphalt emulsions
a. All of this use may not be affected by the regulations because
of likely exemptions.
b.
If all cutback asphalt were replaced with emulsions, up to 271,456
equivalent barrels of oil savings might accrue to the manufacturer,
not user. This is based on the difference in total energy asso-
ciated with manufacturing, processing and laying of cutback asphalt
(50,200 Btu per gallon) and emulsions (2,830 Btu per gallon). One
ton of cutback asphalt or emulsion contains 256 gallons and one
barrel of oil contains 6.05 million Btus.
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Exhibit 17-6 (2)
U.S. Environmental Protection Agency
Current Situation
VOC emission after RACT control
Cost effectiveness of RACT control
Discussion
Net VOC emissions reduction is estimated
to be 27,200 tons annuallyc (100 percent
of 1977 emission level)
$0 annualized cost/annual ton of VOC
reduction level)
c. Based on replacing all cutback asphalt with emulsions.
Source; Booz, Allen & Hamilton Inc.
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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
N. Traxler, Reinhold Publishing Company, New York,
1961.
The Asphalt Handbook, The Asphalt Institute, April 1965.
Introduction to Asphalt, The Asohalt Institute, Novem-
ber 1967.
Telephone interview with Mr. Charles Maday, U.S. EPA
Telephone interview with Mr. Charles Owen, The Asphalt
Institute
Telephone interview with Mr. Terry Drane, Emulsified
Asphalt, Inc.
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