i?i> A //iCn/t-RI/Oftta Office of Air Quality EPA-450 3-81-003a
EPA/45U/3-»l/W»» ,t|Qn p|annmg and Standards
Research Triangle Park NC 27711
A
Air
»EPA VOC Emissions Draft
from Volatile EIS
Organic Liquid
Storage Tanks —
Background Information
for Proposed Standards
Preliminary Draft
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EPA-450/3-81-003a
VOC Emissions from Volatile Organic
Liquid Storage Tanks —
Background Information
for Proposed Standards
Emission Standards and Engineering Division
U.S. ENVIRONMENTAL PROTECTION AGENCY
Office of Air, Noise, and Radiation
Office of Air Quality Planning and Standards
Research Triangle Park, North Carolina 27711
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TABLE OF CONTENTS
Section Page
1 SUMMARY 1-1
1.1 Regulatory Alternatives 1-1
1.2 Environmental Impact 1-2
1.3 Economic Impacts 1-2
2 INTRODUCTION
2.1 Background and Authority for Standards 2-1
2.2 Selection of Categories of Stationary Sources . . . 2-4
2.3 Procedure for Development of Standards of
Performance 2-6
2.4 Consideration of Costs 2-8
2.5 Consideration of Environmental Impacts 2-9
2.6 Impact on Existing Sources 2-10
2.7 Revision of Standards of Performance 2-11
3 VOLATILE ORGANIC LIQUID STORAGE 3-1
3.1 The Volatile Organic Liquid Storage Industry. . . . 3-1
3.2 Storage Tanks 3-3
3.3 Baseline Control and Emissions Estimates 3-34
3.4 References 3-39
4 CONTROL TECHNIQUES 4-1
4.1 Overview 4-1
4.2 Fixed Roof Tanks 4-7
4.3 Internal Floating Roof Tanks 4-9
4.4 External Floating Roof Tanks 4-17
4.5 Vapor Control or Recovery Systems on Fixed Roof
Tanks 4-20
4.6 References 4-25
5 MODIFICATION AND RECONSTRUCTION 5-1
5.1 Provisions for Modifications and Reconstruction . . 5-1
5.2 Applicability to Volatile Organic Liquid Storage. . 5-3
(continued)
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TABLE OF CONTENTS (Concluded)
Section Page
6 REGULATORY ALTERNATIVES AND MODEL PLANTS 6-1
6.1 Regulatory Alternatives 6-1
6.2 Model Plants 6-4
7 ENVIRONMENTAL IMPACTS 7-1
7.1 Introduction 7-1
7.2 Air Pollution Impacts 7-1
7.3 Water Quality and Solid Waste Impacts 7-5
7.4 Energy Impact 7-6
7.5 Other Environmental Concerns 7-6
7.6 References 7-7
8 COST ANALYSIS 8-1
8.1 Capital Costs 8-2
8.2 Annualized Capital Costs 8-18
8.3 Annualized Costs 8-20
8.4 Cost Effectiveness 8-20
8.5 Cost of Other Federal Regulations 8-21
8.6 Costs and Cost Effectiveness of Controls on an
Individual Tank 8-27
8.7 References 8-34
9 ECONOMIC IMPACT 9-1
9.1 Industry Profile 9-1
9.2 Economic Impacts of Regulatory Alternatives .... 9-30
9.3 Regulatory, Inflationary, Socioeconimic, and
Small-Business Impact 9-49
9.4 References 9-51
APPENDICES
A A-l
B B-l
n
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LIST OF FIGURES
Figure Page
3-1 Typical fixed roof tank 3-5
3-2 External floating roof tank 3-7
3-3 Internal floating roof tanks 3-8
3-4 Primary seals 3-11
3-5 Rim-mounted secondary seals on external floating
roofs 3-13
3-6 Metallic shoe seal with shoe-mounted secondary seal . . 3-14
3-7 Typical flotation devices and perimeter seals for
internal floating roofs 3-16
3-8 Rim mounting of a secondary seal on internal floating
roof 3-18
3-9 Typical internal floating roof tank cross section . . . 3-20
3-10 Internal floating roof deck fittings 3-21
3-11 Baseline control summary 3-36
3-12 Baseline emissions totals (Mg/yr: 1977 tank population)
and numbers of tanks by vapor pressure/tank size
region 3-38
4-1 Emissions rates for alternative equipment types
(50 turnovers per year) 4-5
4-2 Emissions rates for alternative equipment types
(10 turnovers per year) 4-6
4-3 Carbon adsorption unit using steam regeneration .... 4-22
4-4 Thermal oxidation unit 4-24
9-1 Organic chemical industry flow chart 9-2
9-2 VOL storage tank market for tanks in volume interval
as characterized in the economic impact analysis . . . 9-33
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LIST OF TABLES
Table Page
1-1
3-1
3-2
3-3
3-4
3-5
3-6
4-1
4-2
4-3
4-4
4-5
4-6
6-1
6-2
7-1
7-2
8-1
8-2
Assessment of Environmental, Energy, and Economic
Impacts for Each Regulatory Alternative Considered
for New VOL Storage Vessels
National Industrial VOL Tank Distribution According to
Vapor Pressure (1977)
National Industrial VOL Tank Distribution According to
Tank Size (1977)
Statistics for the National Tank Population in VOL
Terminal Storage (1979)
Seal Related Factors for External Floating Roof
Tanks
Typical Number of Columns as a Function of Tank
Diameters
Summary of Deck Fitting Loss Factors (Kf) and
Typical Number of Fittings (Nf)
Hierarchy of Equipment Types Based on Emissions Rate. .
Model Tank Emission Rates for Different Equipment
Options
Effectiveness of Internal and External Floating Roof
Tanks Compared to a Fixed Roof Tank for the Model
Tank
"Controlled" and "Uncontrolled" Internal Floating Roof
Deck Fittings
Internal Floating Roof Rim Seal Systems Seal Loss
Factors and Control Efficiencies
External Floating Roof Tank Seal System Control
Efficiencies
Model Terminal
Model Producer/Consumer
Fifth-Year Emissions Resulting from the Regulatory
Alternatives
Fifth-Year Emissions Reductions Resulting from the
Regulatory Alternatives
Estimated Installed Capital Cost of a Fixed Roof
Tank
Estimated Installed Capital Cost of a Noncontact
Internal Floating Roof
(continued)
iv
1-3
3-2
3-2
3-4
3-28
3-32
3-33
4-3
4-8
4-11
4-12
4-14
4-19
6-6
6-6
7-3
7-4
8-3
8-4
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LIST OF TABLES (Continued)
Table Page
8-3 Estimated Installed Cost of a Welded Contact Internal
Floating Roof with Secondary Seals 8-5
8-4 Estimated Installed Capital Cost of External Floating
Roof Tanks with Secondary Seals 8-6
8-5 Cost of Regulatory Alternative I 8-9
8-6 Cost of Regulatory Alternative II 8-10
8-7 Cost of Regulatory Alternative III 8-11
8-8 Cost of Regulatory Alternative IV 8-12
8-9 Cost of Regulatory Alternative V 8-13
8-10 Cost of External Floating Roof Tanks with Primary Seal
and Secondary Seal 8-14
8-11 Cost of External Floating Roof Tanks with Liquid-Mounted
Primary Seal and Secondary Seal 8-15
8-12 Cost of Vapor Control by Incineration Techniques .... 8-16
8-13 Cost of Vapor Recovery by Carbon Adsorption
Techniques 8-17
8-14 Lifetimes of Control Equipment 8-19
8-15 Cost Annualizing Assumptions 8-19
8-16 Federal Laws Regulating Toxic Chemicals 8-22
8-17 Statutes That May be Applicable to the Manufacture and
Storage of Volatile Organic Liquids 8-23
8-18 Proposed Regulations That Will Affect the Chemical
Manufacturing Industry 8-26
8-19 Capital and Annualized Costs for Baseline and Control
Equipment for the Model VOL Tank 8-28
8-20 Absolute Cost Effectiveness of Controlling Fixed Roof
Tank Emissions from the Model Tank 8-29
8-21 Incremental Cost Effectiveness between Internal Floating
Roof Seal Types in the Model Tank 8-30
8-22 Incremental Cost Effectiveness of Controlling Deck
Seam Emissions in the Model Tank 8-31
8-23 Regulatory Alternatives and Incremental Cost
Effectiveness ($/Mg) between Regulatory Alternatives
in the Model Tank 8-32
8-24 Incremental Cost Effectiveness between Equipment
Specified by Each Regulatory Alternative and an External
Floating Roof Tank with a Mechanical Shoe Seal and a
Secondary Seal 8-33
(continued)
v
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LIST OF TABLES (Continued)
Table Page
9-1 Resource Use by Producers of Industrial
Organic Chemicals (SIC 286) 9-6
9-2 Resource Use by Producers of Plastics Materials
and Synthetics (SIC 282) 9-7
9-3 Capital Expenditures and Operating Rates for
SIC 286 and SIC 282, 1958-1978 9-8
9-4 Historical Production and Sales of Industrial
Organic Chemicals, 1955-1981 9-10
9-5 Historical Production and Sales of Plastics
and Resins Materials, 1955-1981 9-11
9-6 Export and Import Values of Industrial Organic Chemicals
(SIC 286) Excluding Gum and Wood Chemicals (SIC 2861)
for Selected Years Between 1972 and 1981 9-13
9-7 Export and Import Values of Plastics Materials and
Synthetics (SIC 282) for Selected Years Between
1972 and 1981 9-13
9-8 Industry-wide Market Concentration Based on
Capacity Share Data, 1976 9-17
9-9 Geographic Distribution of Establishments, Employees,
and Value of Shipments of SIC 286, Industrial Organic
Chemicals 9-18
9-10 Geographic Distribution of Establishments, Employees,
and Value of Shipments of SIC 282, Plastics Materials
and Synthetics 9-20
9-11 Total 1982 Merchant Liquid Bulk Capacity, by State .... 9-21
9-12 Historical Price Data for Industrial Organic Chemicals
and Plastics, Resins, and Elastomers, 1955-1981 9-23
9-13 Projection of VOL Storage Tank Construction—1984 to
1988 All Capacities, Vapor Pressures, and Roof Designs . . 9-28
9-14 Estimated Percentage Distribution of VOL Storage Tanks
by Vapor Pressure and Tank Capacity, 1977 9-29
9-15 Projection of VOL Storage and Construction by
Vapor Pressure and Tank Size, 1984-1988 9-31
9-16 Price Impacts of the Regulatory Alternatives for the
Model Terminal and Model Producer/Consumer 9-37
9-17 Percentage Change in Output Price for the Model Plants
Due to the Regulatory Alternatives 9-38
9-18 Investment Impacts of Regulatory Alternatives for the
Model Independent Terminal and Model Producer/Consumer
(103 $1982) 9-40
(continued)
vi
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LIST OF TABLES (Concluded)
Table Page
9-19 The New Tank Population Impacted by Regulatory
Alternative I as a Percentage of the Projected New
Tank Population 9-42
9-20 The New Tank Population Impacted by Regulatory
Alternatives II-V as a Percentage of the Projected
New Tank Population 9-43
9-21 Additional Nationwide Investment in VOL Storage
Required by the Regulatory Alternatives, 1984-1988 9-47
9-22 Fifth-Year Nationwide Annualized Cost of the
Regulatory Alternatives 9-48
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1. SUMMARY
Standards of performance for new stationary sources are established
under Section 111 of the Clean Air Act (42 U.S.C. 7411), as amended in
1977. Section 111 directs the Administrator to establish standards of
performance for any category of new stationary source of air pollution
which "causes or contributes significantly to, air pollution which may
reasonably be anticipated to endanger public health or welfare." This
background information document supports the proposed standards, which
would control emissions of volatile organic compounds (VOCs) from vessels
that store volatile organic liquids (VOLs). VOL storage vessels are
primarily located at chemical manufacturing facilities and bulk storage
terminals. These vessels are used for storing a variety of materials,
including raw materials, final products, and/or usable byproducts, as
well as waste tars, residues, and nonusable byproducts.
1.1 REGULATORY ALTERNATIVES
In order to evaluate the environmental, economic, and energy impacts
associated with implementation of a standard for VOL storage vessels,
the Administrator has examined the impacts of several regulatory
alternatives for VOL storage vessels. The VOL regulatory alternatives,
in order of increasing emission control potential, would require that
each vessel storing a VOL be equipped with the control technology described
as follows:
• Regulatory Alternative 0 - no additional control over baseline.
• Regulatory Alternative I - an internal floating roof with a
vapor-mounted primary seal (IFR ).
• Regulatory Alternative II - an internal floating roof with a
liquid-mounted primary seal (IFR-, ).
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• Regulatory Alternative III - an internal floating roof with a
liquid-mounted primary seal and controlled deck fittings
• Regulatory Alternative IV - an internal floating roof with a
liquid-mounted primary seal controlled deck fittings, and a
continuous secondary seal (IFR, f ).
• Regulatory Alternative V - a welded internal floating roof
with a liquid-mounted primary seal, controlled deck fittings
and a continuous secondary seal ( IFR, , ).
w lm,cf,ss
1.2 ENVIRONMENTAL IMPACT
The environmental regulatory alternatives are summarized in Table 1-1.
None of the alternatives has any adverse environmental impacts. The
environmental impacts are discussed in detail in Chapter 7.
1.3 ECONOMIC IMPACTS
The economic impacts are also summarized in Table 1-1. None of the
alternatives have any potential adverse economic impacts. The economic
impacts are discussed in detail in Chapter 9.
1-2
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2. INTRODUCTION
2.1 BACKGROUND AND AUTHORITY FOR STANDARDS
Before standards of performance are proposed as a Federal regulation,
air pollution control methods available to the affected industry and the
associated costs of installing and maintaining the control equipment are
examined in detail. Various levels of control based on different
technologies and degrees of efficiency are expressed as regulatory
alternatives. Each of these alternatives is studied by EPA as a
prospective basis for a standard. The alternatives are investigated in
terms of their impacts on the economics and well-being of the industry,
the impacts on the national economy, and the impacts on the environment.
This document summarizes the information obtained through these studies
so that interested persons will be able to see the information considered
by EPA in the development of the proposed standard.
Standards of performance for new stationary sources are established
under Section 111 of the Clean Air Act (42 U.S.C. 7411) as amended,
hereinafter referred to as the Act. Section 111 directs the Administrator
to establish standards of performance for any category of new stationary
source of air pollution which "causes, or contributes significantly to,
air pollution which may reasonably be anticipated to endanger the public
health or welfare."
The Act requires that standards of performance for stationary
sources reflect "the degree of emission reduction achievable which
(taking into consideration the cost of achieving such emission reduction,
and any nonair quality health and environmental impact and energy
requirements) the Administrator determines has been adequately
demonstrated for that category of sources." The standards apply only to
stationary sources whose construction or modification commences after
regulations are proposed by publication in the Federal Register.
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The 1977 amendments to the Act altered or added numerous provisions
that apply to the process of establishing standards of performance.
1. EPA is required to review the standards of performance every
4 years and, if appropriate, revise them.
2. EPA is authorized to promulgate a standard based on design,
equipment, work practice, or operational procedures when a standard
based on emission levels is not feasible.
3. The term "standards of performance" is redefined, and a new
term "technological system of continuous emission reduction" is defined.
The new definitions clarify that the control system must be continuous
and may include a low-polluting or nonpolluting process or operation.
4. The time between the proposal and promulgation of a standard
under Section 111 of the Act may be extended to 6 months.
Standards of performance, by themselves, do not guarantee protection
of health or welfare because they are not designed to achieve any specific
air quality levels. Rather, they are designed to reflect the degree of
emission limitation achievable through application of the best adequately
demonstrated technological system of continuous emission reduction,
taking into consideration the cost of achieving such emission reduction,
any nonair quality health and environmental impacts, and energy
requirements.
Congress had several reasons for including these requirements.
First, standards with a degree of uniformity are needed to avoid situations
in which some States may attract industries by relaxing standards relative
to other States. Second, stringent standards enhance the potential for
long-term growth. Third, stringent standards may help achieve long-term
cost savings by avoiding the need for more expensive retrofitting if
pollution ceilings are reduced in the future. Fourth, certain types of
standards for coal-burning sources can adversely affect the coal market
by driving up the price of low-sulfur coal or effectively excluding
certain coals from the reserve base because their untreated pollution
potentials are high. Congress does not intend that new source performance
standards contribute to these problems. Fifth, the standard-setting
process should create incentives for improved technology.
2-2
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Promulgation of standards of performance does not prevent State or
local agencies from adopting more stringent emission limitations for the
same sources. States are free under Section 116 of the Act to establish
even more stringent emission limits than those established under Section 111
or those necessary to attain or maintain the National Ambient Air Quality
Standards (NAAQS) under Section 110. Thus, new sources may in some
cases be subject to limitations more stringent than standards of performance
under Section 111, and prospective owners and operators of new sources
should be aware of this possibility in planning for such facilities.
A similar situation may arise when a major emitting facility is to
be constructed in a geographic area that falls under the provisions for
prevention of significant deterioration of air quality in Part C of the
Act. These provisions require, among other things, that major emitting
facilities to be constructed in such areas be subject to best available
control technology. The term "best available control technology" (BACT),
as defined in the Act, means:
an emission limitation based on the maximum degree of reduction
of each pollutant subject to regulation under this Act emitted
from, or which results from, any major emitting facility,
which the permitting authority, on a case-by-case basis,
taking into account energy, environmental, and economic impacts
and other costs, determines is achievable for such facility
through application of production processes and available
methods, systems, and techniques, including fuel cleaning or
treatment or innovative fuel combustion techniques for control
of each such pollutant. In no event shall application of
"best available control technology" result in emissions of any
pollutants which will exceed the emissions allowed by any
applicable standard established pursuant to Sections 111 or
112 of this Act. (Section 169(3)).
Although standards of performance are normally structured in terms
of numerical emission limits where feasible, alternative approaches are
sometimes necessary. In some cases, physical measurement of emissions
from a new source may be impractical or exorbitantly expensive.
Section lll(h) provides that the Administrator may promulgate a design
or equipment standard in those cases in which it is not feasible to
prescribe or enforce a standard of performance. For example, emissions
of hydrocarbons from storage vessels for petroleum liquids are greatest
during tank filling. The nature of the emissions (high concentrations
2-3
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for short periods during filling and low concentrations for longer
periods during storage) and the configuration of storage tanks make
direct emission measurement impractical. Therefore, a more practical
approach to standards of performance for storage vessels has been equipment
specification.
In addition, Section lll(j) authorizes the Administrator to grant
waivers of compliance to permit a source to use innovative continuous
emission control technology. To grant the waiver, the Administrator
must find (1) a substantial likelihood that the technology will produce
greater emission reductions than the standards require, or an equivalent
reduction at lower economic, energy, or environmental cost, (2) the
proposed system has not been adequately demonstrated, (3) the technology
will not cause or contribute to an unreasonable risk to the public
health, welfare, or safety, (4) the governor of the State where the
source is located consents, and (5) the waiver will not prevent the
attainment or maintenance of any ambient standard. A waiver may have
conditions attached to ensure that the source will not prevent attainment
of any NAAQS. Any such condition will have the force of a performance
standard. Finally, waivers have definite end dates and may be terminated
earlier if the conditions are not met or if the system fails to perform
as expected. In such a case, the source may be given up to 3 years to
meet the standards with a mandatory progress schedule.
2.2 SELECTION OF CATEGORIES OF STATIONARY SOURCES
Section 111 of the Act directs the Adminstrator to list categories
of stationary sources. The Administrator "shall include a category of
sources in such list if in his judgment it causes, or contributes
significantly to, air pollution which may reasonably be anticipated to
endanger public health or welfare." Proposal and promulgation of standards
of performance are to follow.
Since passage of the Clean Air Amendments of 1970, considerable
attention has been given to the development of a system for assigning
priorities to various source categories. The approach specifies areas
of interest by considering the broad strategy of the Agency for implementing
the Clean Air Act. Often, these "areas" are actually pollutants emitted
2-4
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by stationary sources. Source categories that emit these pollutants are
evaluated and ranked by a process involving such factors as (1) the
level of emission control (if any) already required by State regulations,
(2) estimated levels of control that might be required from standards of
performance for the source category, (3) projections of growth and
replacement of existing facilities for the source category, and (4) the
estimated incremental amount of air pollution that could be prevented in
a preselected future year by standards of performance for the source
category. Sources for which new source performance standards were
promulgated or were under development during 1977, or earlier, were
selected on these criteria.
The Act amendments of August 1977 establish specific criteria to be
used in determining priorities for all major source categories not yet
listed by EPA. These are (1) the quantity of air pollutant emissions
that each such category will emit or will be designed to emit, (2) the
extent to which each such pollutant may reasonably be anticipated to
endanger public health or welfare, and (3) the mobility and competitive
nature of each such category of sources and the consequent need for
nationally applicable new source standards of performance.
The Administrator is to promulgate standards for these categories
according to the schedule referred to earlier.
In some cases, it may not be feasible to immediately develop a
standard for a source category with a high priority. This situation
might occur when a program of research is needed to develop control
techniques, or because techniques for sampling and measuring emissions
may require refinement. In developing standards, differences in the
time required to complete the necessary investigation for different
source categories must also be considered. For example, substantially
more time may be necessary if numerous pollutants must be investigated
from a single source category. Furthermore, even late in the development
process, the schedule for completion of a standard may change. For
example, inability to obtain emission data from well-controlled sources
in time to pursue the development process systematically may force a
change in scheduling. Nevertheless, priority ranking is, and will
continue to be, used to establish the order in which projects are initiated
and resources assigned.
2-5
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After the source category has been chosen, the types of facilities
within the source category to which the standard will apply must be
determined. A source category may have several facilities that cause
air pollution; emissions from these facilities may vary from insignificant
to very expensive to control. Economic studies of the source category
and of applicable control technology may show that air pollution control
is better served by applying standards to the more severe pollution
sources. For this reason, and because there is no adequately demon-
strated system for controlling emissions from certain facilities, standards
often do not apply to all facilities at a source. For the same reasons,
the standards may not apply to all air pollutants emitted. Thus, although
a source category may be selected to be covered by a standard of
performance, all pollutants or facilities within that source category
might not be covered by the standards.
2.3 PROCEDURE FOR DEVELOPMENT OF STANDARDS OF PERFORMANCE
Standards of performance must (1) realistically reflect best
demonstrated control practice, (2) adequately consider the cost, the
nonair-quality health and environmental impacts, and the energy requirements
of such control, (3) be applicable to existing sources that are modified
or reconstructed as well as to new installations, and (4) nreet these
conditions for all variations of operating conditions being considered
anywhere in the country.
The objective of a program for developing standards is to identify
the best technological system of continuous emission reduction that has
been adequately demonstrated. The standard-setting process involves
three principal phases of activity: (1) information gathering, (2) analysis
of the information, and (3) development of the standard of performance.
During the information-gathering phase, industries are queried
through a telephone survey, letters of inquiry, and plant visits by EPA
representatives. Information is also gathered from many other sources,
and a literature search is conducted. From the knowledge acquired about
the industry, EPA selects certain plants at which emission tests are
conducted to provide reliable data that characterize the pollutant
emissions from well-controlled existing facilities.
2-6
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In the second phase of a project, the information about the industry
and the pollutants emitted is used in analytical studies. Hypothetical
"model plants" are defined to provide a common basis for analysis. The
model plant definitions, national pollutant emission data, and existing
State regulations governing emissions from the source category are then
used in establishing "regulatory alternatives." These regulatory
alternatives are essentially different levels of emission control.
EPA conducts studies to determine the impact of each regulatory
alternative on the economics of the industry and on the national economy,
on the environment, and on energy consumption. From several possibly
applicable alternatives, EPA selects the single most plausible regulatory
alternative as the basis for a standard of performance for the source
category under study.
In the third phase of a project, the selected regulatory alternative
is translated into a standard of performance, which, in turn, is written
in the form of a Federal regulation. The Federal regulation, when
applied to newly constructed plants, will limit emissions to the levels
indicated in the selected regulatory alternative.
As early as is practical in each standard-setting project, EPA
representatives discuss the possibilities of a standard, and the form it
might take with members of the National Air Pollution Control Techniques
Advisory Committee. Industry representatives and other interested
parties also participate in these meetings.
The information acquired in the project is summarized in the background
information document (BID). The BID, the standard, and a preamble
explaining the standard are widely circulated to the industry being
considered for control, environmental groups, other government agencies,
and offices within EPA. Through this extensive review process, the
viewpoints of expert reviewers are considered as changes are made to the
documentation.
A "proposal package" is assembled and sent through the offices of
EPA Assistant Administrators for concurrence before the proposed standard
is officially endorsed by the EPA Administrator. After being approved
by the EPA Administrator, the preamble and the proposed regulation are
published in the Federal Register.
2-7
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As a part of the Federal Register announcement of the proposed
regulation, the public is invited to participate in the standard-setting
process. EPA invites written comments on the proposal and also holds a
public hearing to discuss the proposed standard with interested parties.
All public comments are summarized and incorporated into a second volume
of the BID. All information reviewed and generated in studies in support
of the standard of performance is available to the public in a "docket"
on file in Washington, D.C.
Comments from the public are evaluated, and the standards of
performance may be altered in response to the comments.
The significant comments and EPA's position on the issues raised
are included in the "preamble" of a promulgation package, which also
contains the draft of the final regulation. The regulation is then
subjected to another round of review and refinement until it is approved
by the EPA Administrator. After the Administrator signs the regulation,
it is published as a "final rule" in the Federal Register.
2.4 CONSIDERATION OF COSTS
Section 317 of the Act requires an economic impact assessment with
respect to any standard of performance established under Section 111 of
the Act. The assessment is required to contain an analysis of (1) the
costs of compliance with the regulation, including the extent to which
the cost of compliance varies depending on the effective date of the
regulation and the development of less expensive or more efficient
methods of compliance, (2) the potential inflationary or recessionary
effects of the regulation, (3) the effects the regulation might have on
small business with respect to competition, (4) the effects of the
regulation on consumer costs, and (5) the effects of the regulation on
energy use. Section 317 also requires that the economic impact assessment
be as extensive as practicable.
The economic impact of a proposed standard upon an industry is
usually addressed both in absolute terms and in terms of the control
costs that would be incurred as a result of compliance with typical,
existing State control regulations. An incremental approach is necessary
because both new and existing plants would be required to comply with
2-8
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State regulations in the absence of a Federal standard of performance.
This approach requires a detailed analysis of the economic impact from
the cost differential that would exist between a proposed standard of
performance and the typical State standard.
Air pollutant emissions may cause water pollution problems, and
captured potential air pollutants may pose a solid waste disposal problem.
The total environmental impact of an emission source must, therefore, be
analyzed and the costs determined whenever possible.
A thorough study of the profitability and price-setting mechanisms
of the industry is essential to the analysis so that an accurate estimate
of potentially adverse economic impacts can be made for proposed standards.
It is also essential to know the capital requirements for pollution
control systems already placed on plants so that the additional capital
requirements necessitated by these Federal standards can be placed in
proper perspective. Finally, it is necessary to assess the availability
of capital to provide the additional control equipment needed to meet
the standards of performance.
2.5 CONSIDERATION OF ENVIRONMENTAL IMPACTS
Section 102(2)(C) of the National Environmental Policy Act (NEPA)
of 1969 requires Federal agencies to prepare detailed environmental
impact statements on proposals for legislation and other major Federal
actions significantly affecting the quality of the human environment.
The objective of NEPA is to build into the decisionmaking process of
Federal agencies a careful consideration of all environmental aspects of
proposed actions.
In a number of legal challenges to standards of performance for
various industries, the United States Court of Appeals for the District
of Columbia Circuit has held that environmental impact statements need
not be prepared by the Agency for proposed actions under Section 111 of
the Clean Air Act. Essentially, the Court of Appeals has determined
that the best system of emission reduction requires the Administrator to
take into account counter-productive environmental effects of a proposed
standard, as well as economic costs to the industry. On this basis,
therefore, the Court established a narrow exemption from NEPA for EPA
determination under Section 111.
2-9
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In addition to these judicial determinations, the Energy Supply and
Environmental Coordination Act (ESECA) of 1974 (PL-93-319) specifically
exempted proposed actions under the Clean Air Act from NEPA requirements.
According to Section 7(c)(l), "no action taken under the Clean Air Act
shall be deemed a major Federal action significantly affecting the
quality of the human environment within the meaning of the National
Environmental Policy Act of 1969." (15 U.S.C. 793(c)(l))
Nevertheless, the Agency has concluded that the preparation of
environmental impact statements could have beneficial effects on certain
regulatory actions. Consequently, although not legally required to do
so by Section 102(2)(C) of NEPA, EPA has adopted a policy requiring that
environmental impact statements be prepared for various regulatory
actions, including standards of performance developed under Section 111
of the Act. This voluntary preparation of environmental impact statements,
however, in no way legally subjects the Agency to NEPA requirements.
To implement this policy, a separate section in this document is
devoted solely to an analysis of the potential environmental impacts
associated with the proposed standards. Both adverse and beneficial
impacts in such areas as air and water pollution, increased solid waste
disposal, and increased energy consumption are discussed.
2.6 IMPACT ON EXISTING SOURCES
Section 111 of the Act defines a new source as "any stationary
source, the construction or modification of which is commenced" after
the proposed standards are published in the Federal Register. An existing
source is redefined as a new source if "modified" or "reconstructed" as
defined in amendments to the general provisions of Subpart A of 40 CFR
Part 60, which were promulgated in the Federal Register on December 16, 1975
(40 FR 58416).
Any physical or operational change to an existing facility which
results in an increase in the emission rate of any pollutant for which a
standard applies is considered a modification. Reconstruction, on the
other hand, means the replacement of components of an existing facility
to the extent that the fixed capital cost exceeds 50 percent of the cost
of constructing a comparable entirely new source and that it be technically
2-10
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and economically feasible to meet the applicable standards. In such
cases, reconstruction is equivalent to a new construction.
Promulgation of a standard of performance requires States to establish
standards of performance for existing sources in the same industry under
Section lll(d) of the Act if the standard for new sources limits emissions
of a designated pollutant (i.e., a pollutant for which air quality
criteria have not been issued under Section 108 or which has not been
listed as a hazardous pollutant under Section 112). If a State does not
act, EPA must establish such standards. General provisions outlining
procedures for control of existing sources under Section lll(d) were
promulgated on November 17, 1975, as Subpart B of 40 CFR Part 60
(40 FR 53340).
2.7 REVISION OF STANDARDS OF PERFORMANCE
Congress was aware that the level of air pollution control achievable
by any industry may improve with technological advances. Accordingly,
Section 111 of the Act provides that the Administrator "shall, at least
every 4 years, review and, if appropriate, revise" the standards.
Revisions are made to ensure that the standards continue to reflect the
best systems that become available in the future. Such revisions will
not be retroactive but will apply to stationary sources constructed or
modified after the proposal of the revised standards.
2-11
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3. VOLATILE ORGANIC LIQUID STORAGE
3.1 THE VOLATILE ORGANIC LIQUID STORAGE INDUSTRY
Volatile organic liquid (VOL) storage vessels are primarily located
at chemical manufacturing and producing facilities and at bulk liquid
transfer terminals. An economic description of these industries is
contained in Section 9.1. The storage of VOL within these industries is
described below.
3.1.1 Industrial Service (Chemical Manufacturing)
Tanks are used for storing a variety of organic liquids, including
raw materials, final products, and/or usable byproducts, as well as
waste tars, residues, and other wastes. Available data were analyzed to
determine the number of tanks in the nation containing volatile organic
123 4
liquids. ' ' The 1977 industrial tank population was found to be 27,540.
The vapor pressure of the material to be stored is a major factor
in choosing the tank type to be used. In practice, fixed roof tanks are
predominantly used for storing materials with vapor pressures up to
34.5 kPa; floating-roof tanks are also used to store materials in the
same range. Table 3-1 gives the distribution of tanks nationally,
according to the vapor pressure of the VOLs stored in fixed and floating
roof tanks. Other factors such as material stability, safety hazards,
and multiple use also affect the choice of tank type for a particular
organic liquid. Table 3-2 gives the national tank distribution by
storage capacity for fixed roof and floating roof tanks.
3.1.2 Terminal Service
A terminal is a nonmanufacturing site that stores commodities in
bulk quantity. Only those terminals that store VOL were of concern to
this study. Telephone directories of selected cities were searched for
terminal listings. As a result of this survey, it was determined that
data obtained from the Independent Liquid Terminal Association (ILTA)
-------
Table 3-1. NATIONAL INDUSTRIAL VOL TANK DISTRIBUTION ACCORDING
TO VAPOR PRESSURE (1977)
Vapor pressure,
(kPa)
0 - 3.5
3.5 - 6.9
6.9 - 10.3
10.3 - 34.5
34.5 - 58.6
£58.6
Total
Percent of Total
Table 3-2.
Number
Fixed-roof
16,350
3,560
1,950
3,800
500
190
26,350
95.7
NATIONAL INDUSTRIAL VOL
TANK SIZE
of tanks nationwide
Floating- roof
170
100
70
790
40
20
1,190
4.3
TANK DISTRIBUTION ACCORDING
(1977)
Total
16,520
3,660
2,020
4,590
540
210
27,540
100.
TO
Tank size,
(m3)
0 - 75
75 - 150
150 - 375
375 - 3,750
3,750 - 15,000
^15,000
Total
Percent of Total
Number of tanks nationwide
Fixed-roof
12,270
3,910
3,770
5,840
520
40
26,350
95.7
Floating-roof
20
30
180
610
320
30
1,190
4.3
Total
12,290
3,940
3,950
6,450
840
70
27,540
100.
3-2
-------
would serve as a sufficient approximation of the national terminal
population. Sixty-eight ILTA member companies operate more than 150
terminals. Of these, 82 terminals handle VOLs. It was assumed that any
terminal storing VOL devoted its entire storage volume to VOL. Statistics
for the tanks in the 82 VOL terminals are given in Table 3-3.
3.2 STORAGE TANKS
3.2.1 Types of Storage Tanks
There are three types of vessels of concern in developing standards
of performance for VOL storage vessels:
• fixed roof tanks;
• external floating roof tanks; and
• internal floating roof tanks.
These tanks are cylindrical in shape with the axis oriented perpendicular
to the foundation. The tanks are almost exclusively above ground.
Below-ground vessels and horizontal vessels (i.e. with the axis parallel
to the foundation) also can be used in VOL service. However, these
types of vessels are much less common in VOL service than the other tank
types listed above. For the most part, are less than 100 cubic meters
(26,400 gallons) in capacity. Consequently, their contribution to
nationwide VOL storage emissions is minor. Controls applicable to
horizontal tanks primarily are limited to closed vent systems and control
devices as discussed in Chapter 4. Since their contribution to nationwide
emissions is minor, no detailed equipment description is provided for
these types of roofs. For a similar reason, no detailed equipment
description is provided for pressure vessels. This section, therefore,
addresses only fixed roof, external floating and internal floating roof
tanks.
3.2.1.1 Fixed Roof Tanks. Of currently used tank designs, the
fixed-roof tank is the least expensive to construct and is generally
considered as the minimum acceptable equipment for the storage of VOLs.
A typical fixed-roof tank, which is shown in Figure 3-1, consists of a
cylindrical steel shell with a cone- or dome-shaped roof that is permanently
affixed to the tank shell. A breather valve (pressure-vacuum valve),
which is commonly installed on many fixed roof tanks, allows the tank to
3-3
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Table 3-3. STATISTICS FOR THE NATIONAL TANK POPULATION IN
VOL TERMINAL STORAGE (1979)
CAPACITY
Total capacity in data base: 1.390 x 1010 liters (3,670 x 106 gal)
Average capacity for a terminal: 1.78 x 108 liters (47 x 106 gal)
Median capacity for a terminal: 9.35 x 107 liters (25 x 106 gal)
NUMBER OF TANKS
Total number of tanks at terminals in data base: 4,212
Average number of tanks per terminal: 54
Median number of tanks per terminal: 37.5
SMALLEST TANK3
Average size of smallest tank: 1.2 x 106 liters (318.9 x 103 gal)
Median size of smallest tank: 1.59 x 10s liters (42 x 103 gal)
AVERAGE TANK SIZE: 3.3 x 106 liters (872 x 103 gal)
LARGEST TANKb
Average size of largest tank: 1.36 x 107 liters (3,599 x 103 gal)
Median size of largest tank: 9.22 x 106 liters (2,436 x 103 gal)
aVolume of the smallest tank at each terminal.
Volume of the largest tank at each terminal.
3-4
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PRESSURE-VACUUM
VALVE
GAUGE HATCH
MANHOLE
MANHOLE
TANK
SUPPORT
COLUMN
NOZZLE
(FOR SUBMERGED FILL
OR DRAINAGE)
Figure 3-1. Typical fixed roof tank.
3-5
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operate at a slight internal pressure or vacuum. Because this valve
prevents the release of vapors only during very small changes in
temperature, barometric pressure, or liquid level, the emissions from a
fixed roof tank can be appreciable.
3.2.1.2 External Floating Roof Tanks. A typical external floating
roof tank is shown in Figure 3-2. This type of tank consists of a
cylindrical steel shell equipped with a deck or roof that floats on the
surface of the stored liquid, rising and falling with the liquid level.
The liquid surface is completely covered by the floating roof except in
the small annular space between the roof and the shell. A seal attached
to the roof touches the tank wall (except for small gaps in some cases)
and covers the remaining area. The seal slides against the tank wall as
the roof is raised or lowered.
3.2.1.3 Internal Floating Roof Tanks. An internal floating roof
tank has both a permanently affixed roof and a roof that floats inside
the tank on the liquid surface (contact roof), or supported on pontoons
several inches above the liquid surface (noncontact roof). The internal
floating roof rises and falls with the liquid level. Typical contact
and noncontact internal floating roof tanks are shown in Figures 3-3a
and 3-3b, respectively.
Contact-type roofs include (1) aluminum sandwich panel roofs with a
honeycombed aluminum core floating in contact with_the liquid; (2) resin
coated, glass fiber reinforced polyester (RFP) buoyant panels, floating
in contact with the liquid; and (3) pan-type steel roofs, floating in
contact with the liquid with or without the aid of pontoons. The majority
of contact internal floating roofs currently in VOL service are steel-pan
type or aluminum sandwich panel type. The RFP roofs are less common.
Several variations of the pan-type contact steel roof exist. The
design may include bulkheads, or open compartments, around the perimeter
of the roof to minimize and/or localize the effects of liquid that may
leak or spill onto the deck. Alternately, the bulkheads may be covered
to form sealed compartments (i.e., pontoons), or the entire pan may be
covered to form a sealed double deck steel floating roof. Construction
is generally welded steel.
3-6
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Figure 3-2. External floating roof tank (pontoon type).
3-7
-------
Center Vtnt
Peripheral Roof Vtnt
Primary Seal
Manhole
Peripheral Roof Vent
Primary Seal
Manhole
Tank Support Col am with Column Well
a. Contact internal floating roof.
Center Vent
R1m Plate
R1n Pontoons
R1gi Pontoons
Pontoons
•Tank Support Column with Column Well
Vapor Space
b. Noncontact Internal floating roof.
Figure 3-3. Internal floating roof tanks.
3-8
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Noncontact-type roofs typically consist of an aluminum deck on an
aluminum grid framework supported above the liquid surface by tubular
aluminum pontoons. The deck skin for the noncontact-type floating roofs
typically is constructed of rolled aluminum sheets (about 1.5 m wide and
0.58 mm thick). The overlapping aluminum sheets are joined by bolted
aluminum clamping bars that run perpendicular to the pontoons to improve
the rigidity of the frame. The deck skin seams can be metal on metal or
gasketed with a polymeric material. The pontoons and clamping bars form
the structural frame of the floating roof. The presence of deck seams
in the noncontact internal floating roof design contributes to emissions
from the internal floating roof tank. Aluminum sandwich panel contact-type
internal floating roofs share this design feature. The sandwich panels
are joined with bolted mechanical fasteners that are similar in concept
to the noncontact deck skin clamping bars. Steel-pan contact internal
floating roofs are constructed of welded steel sheets and have no deck
seams. Similarly, the resin-coated, reinforced fiberglass panel roofs
have no apparent deck seams. The panels are butted and lapped with
resin-impregnated fiberglass fabric strips. The significance of deck
seams to emissions from internal floating roof tanks is addressed in
Chapter 4.
It should be recognized that the roof physically occupies a finite
volume of space that takes away from the maximum liquid storage capacity
of the tank. When completely full, the floating roof touches or nearly
touches the fixed roof. Consequently, the effective height of the tank
decreases, thus limiting the storage capacity. The reduction in the
effective height varies from about 1 to 2 feet depending on the type and
design of the floating roof employed.
All types of internal floating roofs, like external floating roofs,
commonly incorporate flexible perimeter seals or wipers that slide
against the tank wall as the roof moves up and down. These seals are
discussed in detail in Section 3.2.2.2. Circulation vents and an open
vent at the top of the fixed roof are generally provided to minimize the
possibility of hydrocarbon vapors accumulating in concentrations approaching
the flammable range.
3-9
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3.2.2 Types of Floating Roof Perimeter Seals
3.2.2.1 External Floating Roof Seals. Regardless of tank design,
a floating roof requires a closure device to seal the gap between the
tank wall and the roof perimeter. A primary seal, the lower seal of a
two-seal system, can be made from various materials suitable for organic
liquids service. The basic designs available for primary seals are
(1) mechanical shoe seals, (2) liquid-filled seals, and (3) (vapor- or
liquid-mounted) resilient foam log seals. Figure 3-4 depicts these
three general types of seals.
One major difference in seal system design is the way in which the
seal is mounted with respect to the liquid. Figure 3-4c shows a vapor
space between the liquid surface and seal, whereas, in Figures 3-4a and
3-4d, the seals are resting on the liquid surface. These liquid-filled
tube and resilient foam seals are classified as liquid- or vapor-mounted
seals depending on their location. Mechanical shoe seals are different
in design from liquid-filled or resilient foam log seals and cannot be
characterized as liquid- or vapor-mounted. However, because the shoe
and envelope combination precludes communication between the annular
vapor space above the liquid and the atmosphere (see Figure 3-4b), the
performance of a mechanical shoe seal is more like that of a liquid-mounted
seal than a vapor-mounted seal.
3.2.2.1.1 Mechanical shoe seal. A mechanical shoe seal, otherwise
known as a "metallic shoe seal" (Figure 3-4b), is characterized by a
metallic sheet (the "shoe") 75 to 130 cm (30 to 51 in) high held against
the vertical tank wall. The shoe is connected by braces to the floating
roof and is held tightly against the wall by springs or weighted levers.
A flexible, coated fabric (the "envelope") is suspended from the shoe
seal to the floating roof to form a vapor barrier over the annular space
between the roof and the primary seal.
3.2.2.1.2 Liquid-filled seal. A liquid-filled seal (Figure 3-4a)
may be a tough fabric band or envelope filled with a liquid, or it may
be a flexible polymeric tube 20 cm to 25 cm (8 inch to 10 inch) in
diameter filled with a liquid and sheathed with a tough fabric scuff
band. The liquid is commonly a petroleum distillate or other liquid
that will not contaminate the stored product if the tube ruptures.
3-10
-------
Tank
Wall
Scuff
Metallic Weather
Shield
Floating Roof
Liquid Filled
Tube
a. Liquid-filled seal with weather
shield.
/I
Tank
Wall
Metallic Heather
Shield
Floating Roof
Seal Fabric
, - Resilient Foam
Vapor Space
c. Vapor-mounted resilient foam-
filled seal with weather shield.
.Tank Wall
Floating Roof
Vapor Space
b. Metallic shoe seal.
Tank
Wall
Metallic Weather
Shield
Floating Roof
•-Seal Fabric
J4Resilient Foam
d. Liauid-mounted resilient foam-
filled seal with weather shield
Figure 3-4. Primary seals.
3-11
-------
Liquid-filled seals are mounted on the product liquid surface with no
vapor space below the seal.
3.2.2.1.3 Resilient foam-filled seal. A resilient foam-filled
seal is similar to a liquid-filled seal except that a resilient foam log
is used in place of the liquid. The resiliency of the foam log permits
the seal to adapt itself to some imperfections in tank dimensions and in
the tank shell. The foam log may be mounted above the liquid surface
(vapor-mounted) or on the liquid surface (liquid-mounted). Typical
vapor-mounted and liquid-mounted seals are presented in Figures 3-4c and
3-4d, respectively.
3.2.2.1.4 Secondary seals on external floating roofs. A secondary
seal on an external floating roof is a continuous seal mounted on the
rim of the floating roof and extending to the tank wall, covering the
entire primary seal. Secondary seals are normally constructed of flexible
polymeric materials and mounted such that they provide a wiping action
against the tank wall as the roof raises and lowers. Figure 3-5 depicts
several primary and secondary seal systems. An alternative secondary
seal design incorporates a steel leaf to bridge the gap between the roof
and the tank wall. The leaf acts as a compression plate to hold a
polymeric wiper against the tank wall.
Installed over a primary seal, a secondary seal provides a barrier
for VOC emissions that escape from the small vapor space between the
primary seal and the wall and through any openings or tears in the seal
envelope of a metallic shoe seal (Figure 3-5). Although not shown in
Figure 3-5, a secondary seal can be used in conjunction with a weather
shield as described in the following section.
Another type of secondary seal is a shoe-mounted secondary seal. A
shoe-mounted seal extends from the top of the shoe to the tank wall
(Figure 3-6). These seals do not provide protection against VOC leakage
through the envelope. Holes, gaps, tears, or other defects in the
envelope can permit direct communication between the saturated vapor
under the envelope and the atmosphere. Wind can enter this space through
envelope defects, flow around the circumference of the tank, and exit
with saturated or nearly saturated VOC vapors.
3-12
-------
•TAttK
KMMIOUNTED
,Sf CONOARr UAL
TA«K
•All
MMioumo tscoaOANv SEAL
t
IMCMOO^ '
UUFF IAMD
X-IIOUIO-FILLEOTUIE
a. Shoe seal with rim-mounted
secondary seal.
b. Liquid-filled seal with rim-
mounted secondary seal.
RMUMOUWTED
,ICCO»DARYSEAL
c. Resilient foam seal (vapor-
mounted) with rim-mounted
secondary seal.
d. Resilient foam seal (liquid-
mounted) with rim-mounted
secondary seal.
Figure 3-5 (a-d).
Rim-mounted secondary seals on
external floating roofs.
3-13
-------
TANK
SECONDARY SEAL
(WIPER TYPI)
^FLOATING ROOF
VAPOR SPACE
Figure 3-6. Metallic shoe seal with shoe-mounted secondary seal.
3-14
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3.2.2.1.5 Weather shield. A weather shield (Figures 3-4a, 3-4c,
and 3-4d) may be installed over the primary seal or the primary and
secondary seals, to protect it, or them, from deterioration caused by
debris and exposure to the elements. Typically, a weather shield is an
arrangement of overlapping thin metal sheets pivoted from the floating
roof to ride against the tank wall. The weather shield, by the nature
of its design, is not an effective vapor barrier. For this reason, it
differs from the secondary seal. Although the two devices are conceptually
similar in design, they are designed for and serve different purposes.
3.2.2.2 Internal Floating-Roof Tank Seals. Internal floating
roofs typically incorporate one of two types of flexible, product-resistant
primary seals: resilient foam-filled seals or wiper seals. Similar to
those employed on external floating roofs, each of these seals closes
the annular vapor space between the edge of the floating roof and the
tank shell. They are designed to compensate for small irregularities in
the tank shell, and allow the roof to move freely up and down in the
tank without binding.
3.2.2.2.1 Resilient foam-filled seal. A resilient foam-filled
seal used on an internal floating roof is similar in design to that
described in Section 3.2.2.1.3 for external floating roofs. Two types
of resilient foam-filled seals for internal floating roofs are shown in
Figures 3-7a and 3-7b. These seals can either be mounted in contact
with the liquid surface (liquid-mounted) or several centimeters above
the liquid surface (vapor-mounted).
Resilient filled seals work on the principle of expansion and
contraction of a resilient material to maintain contact with the tank
shell while accommodating varying annular rim space widths. These seals
consist of a core of open-cell foam encapsulated in a coated fabric.
The elasticity of the foam core pushes the fabric into contact with the
tank shell. The seals are attached to a mounting on the deck perimeter
and are continuous around the circumference. Urethane coated nylon
fabric and polyurethane foam are commonly employed materials. For
emission control, it is important that the mounting and radial seal
joints be vapor-tight and that the seal be in substantial contact with
the tank shell.
3-15
-------
a. Resilient foam-filled seal (vapor-mounted).
Contact internal floating roof
/aluminum sandwich panel roof)
•V- L
•Resilient foam-filled seal
b. Resilient foam-filled seal (liquid-mounted)
Resilient foam-filled seal
f^* • • ^
C * • * • •
\r« * • • • j
Viv^r
Tank w<
/LOntaC t i ntcrna 1 T I Oa ti ng TOUT
(pan -type steel roof) /
ill
c. Elastomeric wiper seal.
lastomeric wiper seal
i
Non-contact internal floating roof
Pontoon-^
. ,ontoon
\ ^Metal seal ring
Tank wall
Note: v - vapor
L - liquid
Figure 3-7. Typical flotation devices and perimeter seals for
internal floating roofs.
3-16
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3.2.2.2.2 Primary wiper seals. Wiper seals are commonly used as
primary seals for internal floating roof tanks. This type of seal is
depicted in Figure 3-7c.
Wiper seals generally consist of a continuous annular blade of
flexible material fastened to a mounting on the deck perimeter, spanning
the annular rim space, and contacting the tank shell. The mounting is
such that the blade is flexed, and its elasticity provides a sealing
pressure against the tank shell. A vapor space exists between the
liquid stock and the bottom of the seal; such seals are vapor-mounted.
For emission control, it is important that the mounting be vapor-tight,
that the seal be continuous around the circumference, and that the blade
be in substantial contact with the tank shell.
Two types of wipers are commonly used. One type consists of a
cellular, elastomeric material tapered in cross section with the thicker
portion at the mounting. Buna-N rubber is a commonly-used material.
All radial joints in the blade are joined.
A second type of wiper seal construction uses a foam core wrapped
with a coated fabric. Urethane on nylon fabric and polyurethane foam
are common materials. The core provides the flexibility and support
while the fabric provides the vapor barrier and wear surface.
A third type of wiper seal consists of overlapping segments of seal
material (shingle-type seal). Single-type seals differ from the wiper
seals discussed previously in that they do not provide a continuous
vapor barrier.
3.2.2.2.3 Secondary seals for internal floating roof tanks.
Secondary seals may be used to provide some additional evaporative loss
control over that achieved by the primary seal. The secondary seal
would be mounted to an extended vertical rim plate, above the primary
seal, as shown in Figure 3-8. Secondary seals can be either an elastomeric
wiper seal or a resilient foam-filled seal as described in Sections 3.2.2.2.2
and 3.2.2.2.1, respectively. For a given roof design, the use of a
secondary seal further limits the operating capacity of a tank due to
the need to avoid interference of the seal with the fixed roof rafters
when the tank is filled. Currently, secondary seals are not commonly
used on internal floating roof tanks .
3-17
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SECONDARY SEAL
PRIMARY SEAL
IfttERSED IN VOL
CONTACT TYPE
INTERNAL FLOATING ROOF
Figure 3-8. Rim mounting of a secondary seal on internal floating roof.
8
3-18
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3.2.3 Types of Internal Floating Roof Deck Fittings
The majority of Section 3.2.3 largely is from a draft American
Petroleum Institute publication that is expected to be published in
June, 1983.
There are numerous fittings that penetrate or are attached to an
internal floating roof. These fittings serve to accommodate structural
support members or to allow for operational functions. A cross section
of an internal floating roof tank showing typical fittings is depicted
in Figure 3-9. The fittings can be a source of evaporative loss, in
that, they require penetrations in the deck. Other accessories are used
that do not penetrate the deck and are not, therefore, sources of
evaporative loss. The most common fittings with relevance to controllable
vapor losses are described in the following sections.
3.2.3.1 Access Hatches. An access hatch consists of an opening in
the deck with a peripheral vertical well attached to the deck and a
removable cover to close the opening. An access hatch is sized to
provide for passage of workers and materials through the deck for
construction or servicing. The cover can rest directly on the well, or
a gasketed connection can be used to reduce evaporative loss. Bolting
the cover to the well provides further loss reduction. With noncontact
decks, the well should extend down into the liquid stock to seal off the
vapor space below the deck. Figure 3-10a depicts an access hatch that
is suitable for use on a steel contact internal floating roof.
3.2.3.2 Column Wei Is. The most common fixed roof designs are
normally supported from inside the tank by means of vertical columns,
which necessarily penetrate the floating deck. (Some fixed roofs are
entirely self-supporting and, therefore, have no support columns.)
Columns are made of pipe with circular cross sections or of structural
shapes with irregular cross sections. The number of columns varies with
tank diameter, from a minimum of one to over 50 for very large tanks.
Figure 3-10b depicts a column well for a built-up column.
The columns pass through deck openings with peripheral vertical
wells. With noncontact decks, the well should extend down into the
liquid stock. Generally, a closure device exists between the top of the
well and the column. Several proprietary designs exist for this closure,
3-19
-------
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3-22
-------
including sliding covers and fabric sleeves, which must accommodate the
movements of the deck relative to the column as the liquid levels change.
A sliding cover rests on the upper rim of the column well (which is
normally fixed to the roof) and bridges the gap or space between the
column well and the column. The cover, which has a cutout or opening
around the column, slides in a vertical direction relative to the column
as the roof raises and lowers. At the same time, the cover slides in a
horizontal direction relative to the rim of the well, which is fixed to
the roof. A gasket around the rim of the well reduces emissions from
this fitting. A flexible fabric sleeve seal between the rim of the well
and the column (with a cutout or opening to allow vertical motion of the
seal relative to the columns) similarly accommodates limited horizontal
motion of the roof relative to the column. A third design, which is
proprietary, is depicted in Figure 3-10b. This design, in effect,
combines the advantages of the flexible fabric sleeve seal with a well
that excludes all but a small portion of the liquid surface from direct
communication with the vapor space above the floating roof.
3.2.3.3 Roof Legs or Hanger Wells. To prevent damage to fittings
underneath the deck and to allow for tank cleaning or repair, supports
are provided to hold the deck a pre-determined distance off the tank
bottom. These supports consist of adjustable or fixed legs attached to
the floating deck or hangers suspended from the fixed roof. For adjustable
legs or hangers, the load-carrying element passes through a well or
sleeve in the deck. With noncontact decks, the well should extend into
the liquid stock. Figure 3-10c depicts a roof leg assembly.
3.2.3.4 Sample Pipes or Wells. A sample well may be provided to
allow for sampling of the liquid stock. Typically, the well is funnel-
shaped to allow for easy entry of a sample thief. A closure is provided,
which is typically located at the lower end of the funnel and which
frequently consists of a horizontal piece of fabric slit radially to
allow thief entry. The well should extend into the liquid stock on
noncontact decks. Figure 3-10d depicts a sample well assembly.
Alternately, a sample well may consist of a slotted pipe extending
into the liquid stock, equipped with an ungasketed or gasketed sliding
6
cover.
3-23
-------
3.2.3.5 Vacuum Breakers. When the internal floating deck is
either being landed on its legs or floated off its legs, a vacuum breaker
is used to equalize the pressure of the vapor space across the deck.
This is accomplished by opening a deck penetration that usually consists
of a well formed of pipe or framing on which rests a cover. To the
underside of the cover is attached a guided leg of such length that it
contacts the tank bottom as the internal floating deck approaches the
tank bottom. When in contact with the tank bottom, the guided leg
mechanically opens the breaker by lifting the cover off the well. When
the leg is not contacting the bottom, the penetration is closed by the
cover resting on the well. The closure may be with or without a gasket
between the cover and neck. Since the purpose of the vacuum breaker is
to allow the free exchange of air and/or vapor, the well does not extend
appreciably below the deck. Figure 3-10e depicts a pressure vacuum
assembly. The gasket on the underside of the cover, or conversely on
the upper rim of the well, provides a small measure of emission control
(•v-20 percent emissions reduction) during periods when the roof is free
floating and the breaker is closed.
3.2.3.6 Automatic Gauge Float Wells. Gauge floats are used to
indicate the level of stock within the tank. They usually consist of a
float residing within a well that passes through the floating deck. The
float is connected to an indicator on the exterior of the tank via a
tape passing through a guide system on the fixed roof. The float rests
on the stock surface within the well. The well is closed by a cover
that rests on the well. Evaporation loss can be reduced by gasketing
and/or bolting the connection between the cover and the rim of the well.
The cable passes through a bushing located at the center of the cover.
As with other similar deck penetrations, the well extends into the
liquid stock on noncontact floating decks. Figure 3-10f depicts a
bolted automatic gauge float well assembly.
3.2.3.7 Ladder Wells. Some tanks are equipped with internal
ladders that extend from a manhole in the fixed roof to the tank bottom.
The deck opening through which the ladder passes is constructed with
similar design details and considerations as those for column wells, as
discussed in Section 3.2.3.2.6
3-24
-------
3.2.4 Storage Tank Emissions and Emission Equations
3.2.4.1 Fixed-Roof Tank Emissions. The major types of emissions
from fixed-roof tanks are breathing and working losses. Breathing loss
is the expulsion of vapor from a tank vapor space that has expanded or
contracted because of daily changes in temperature and barometric pressure.
The emissions occur in the absence of any liquid level change in the
tank.
Filling losses are associated with an increase of the liquid level
in the tank. The vapors are expelled from the tank when the pressure
inside the tank exceeds the relief pressure as a result of filling.
Emptying losses occur when the air that is drawn into the tank during
liquid removal saturates with hydrocarbon vapor and expands, thus exceeding
the fixed capacity of the vapor space and overflowing through the pressure
vacuum valve. Combined filling and emptying losses are called "working
losses."
Emission equations for breathing and working losses were developed
for EPA Publication No. AP-42. The equations used in estimating
emissions rates for fixed roof tanks storing VOL are:
4 = LB + Lw (3-1)
LD = 1.02 x 10-5 M ( P_)°-68 Di.73Ho.siTo.sF CK (3-2)
B v 14 7_p p c
L, = 1.09 x 10-8M PVNK K (3-3)
w v n c
where, Lj = total loss (Mg/yr)
LB = breathing loss (Mg/yr)
L, = working loss (Mg/yr)
M = molecular weight of product vapor (Ib/lb mole); 80 assumed
v as a typical value for VOL liquids
P = true vapor pressure of product (psia)
D = tank diameter (ft)
H = average vapor space height (ft): use tank specific values
or an assumed value of one-half the tank height
T = average diurnal temperature change in °F; 20°F assumed as
a typical value
3-25
-------
F = paint factor (dimensionless); 1.0 for clean white paint
C = tank diameter factor (dimensionless):
for diameter ^ 30 feet, C = 1
for diameter < 30 feet,
C = 0.0771 D - 0.0013(D2) - 0.1334
K = product factor (dimensionless) =1.0 for VOL
L*
V = tank capacity (gal)
N = number of turnovers per year (dimensionless)
K = turnover factor (dimensionless):
for turnovers > 36, Kn = 18gN+ N
for turnovers ^ 36, K =1
3.2.4.2 External Floating-Roof Tank Emissions. Standing-storage
losses, which result from causes other than a change in the liquid
level, constitute the major source of emissions from external floating
roof tanks. The largest potential source of these losses is an improper
fit between the seal and the tank shell (seal losses). As a result,
some liquid surface is exposed to the atmosphere. Air flowing over the
tank creates pressure differentials around the floating roof. Air flows
into the annular vapor space on the leeward side and an air-vapor mixture
flows out on the windward side.
Withdrawal loss is another source of emissions from floating roof
tanks. When liquid is withdrawn from a tank, the floating roof is
lowered, and a wet portion of the tank wall is exposed. Withdrawal loss
is the vaporization of liquid from the wet tank wall.
VOL emissions from external floating roof tanks are estimated using
equations based on a pilot tank study conducted for the EPA by the
Q
Chicago Bridge and Iron Company. Appendix C describes the development
of the emission equations and the associated emission factors.
From the equations presented below, it is possible to estimate the
total evaporation loss for external floating roof tanks, Ly, which is
the sum of the withdrawal loss, L,, and the external floating roof seal
11
loss, LSE- These equations in large part are extracted from AP-42.
However, minor changes have been made to update the equations. (Note:
external floating roof tanks have no appreciable losses from fittings.)
3-26
-------
LT = Lw + LSE (3-4)
Ly = 4.28 x 10"4 QCWL/D (3-5)
LSE = KSvNp*DMV KC/2205 (3~6)
where, LT = total loss (Mg/yr)
LW = withdrawal loss (Mg/yr)
L^r = seal loss from external floating roof tanks (Mg/yr)
Q = product average throughput (bbl/yr);
tank capacity (bbl/turnover) x turnovers/yr
C = product withdrawal shell clingage factor (bbl/103 ft2); use
0.0015 bbl/103 ft2 for VOL in a welded steel tank with
light rust (0.0075 for dense rust)
W, = density of product (Ib/gal); 7.4 to 8.0 Ib/gal assumed as
typical range for VOL liquids
D = tank diameter (ft)
KS = seal factor: obtain from Table 3-4
V = average windspeed for the tank site (mph);
10 mph assumed average windspeed
N = seal windspeed exponent (dimensionless): obtain from
Table 3-4
P* = the vapor pressure function (dimensionless);
P* = 0.068P/((1 + (1 - 0.068P)0-5)2)
P = the true vapor pressure of the materials stored (psia)
MV = molecular weight of product vapor (Ib/lbmole)
K« = product factor (dimensionless) =1.0 for VOL
3.2.4.3 Internal Floating Roof Tank Emissions. As ambient wind
flows over the exterior of an internal floating roof tank, air flows
into the enclosed space between the fixed and floating roofs through
some of the shell vents and out of the enclosed space through others.
Any VOC vapors that have evaporated from exposed liquid surface and that
have not been contained by the floating deck will be swept out of the
enclosed space.
Losses of VOC vapors from under the floating roof occur in one of
four ways:
(1) through the annular rim space around the perimeter of the
floating roof (rim or seal losses);
(2) through the openings in the deck required for various types of
fittings (fitting losses);
3-27
-------
Table 3-4. SEAL RELATED FACTORS FOR
EXTERNAL FLOATING ROOF TANKS3
Seal type
Metallic shoe seal
Primary seal only
With shoe mounted secondary seal
With rim mounted secondary seal
Liquid mounted resilient seal
Primary seal only
With weather shield
With rim mounted secondary seal
Vapor mounted resilient seal
Primary seal only
With weather shield
With rim mounted secondary seal
(Ks)b
1.2
0.8
0.2
1.1
0.8
0.7
1.2
0.9
0.2
(N)C
1.5
1.2
1.0
1.0
0.9
0.4
2.3
2.2
2.6
aBased on emissions from tank seal system with emissions
control devices (roof, seals, etc.) in reasonably good
working condition, no visible holes, tears or unusually
large gaps between the seals and the tank wall.
KC = seal factor in Equation 3-6.
N = seal windspeed exponent (dimensionless) in
Equation 3-6.
3-28
-------
(3) through the nonwelded seams formed when joining sections of
the deck material (deck seam losses); and
(4) through evaporation of liquid left on the tank wall following
withdrawal of liquid from the tank (withdrawal loss).
The withdrawal loss from an internal floating roof tank is similar to
that discussed in the previous section for external floating roofs. The
other losses, seal losses, fitting losses and deck seam losses, occur
not only during the working operations of the tank but also during free
standing periods. The mechanisms and loss rates of internal floating
roof tanks was studied in detail by the Chicago Bridge and Iron Company
for the American Petroleum Institute. The results of this work form
the basis for internal floating roof emissions discussion.
Several potential mechanisms for vapor loss from the rim seal area
of an internal floating roof tank can be postulated:
• circumferential vapor movement underneath vapor-mounted rim
seals;
• vertical mixing, due to diffusion or air turbulence, of the
vapor in gaps that may exist between any type of rim seal and
the tank shell;
t expansion of vapor spaces in the rim area due to temperature
or pressure changes;
• varying solubility of gases, such as air, in the rim space
liquid due to temperature and pressure changes;
• wicking of the rim space liquid up the tank shell; and
• vapor permeation through the sealing material.
For external floating roof tanks, wind-generated air movement across the
roof is the dominant factor affecting rim seal loss. In comparison, for
freely-vented internal floating roof tanks, in which the air movement is
significantly reduced, no clearly dominant loss mechanism can be discerned.
Vapor permeability is the only potential rim seal area loss mechanism
that is readily amenable to independent investigation. Seal fabrics are
generally reported to have very low permeability to typical hydrocarbon
vapors, such that this source of loss is not considered to be significant.
However, if a seal material is used that is highly permeable to the
3-29
-------
vapor from the stored stock, the rim seal loss could be significantly
higher than that estimated from the rim seal loss equation presented
later in this section. Particularly when dealing with VOL rather than
petroleum liquids, attention must be paid to the properties of the
individual compounds being stored. For instance, benzene is suspected
of having permeability losses that equal or exceed convective and diffusion
13
losses from the seal. Additional permeability data for VOL/seal
material combinations must be developed to fully characterize the
significance of permeability losses. Permeability is discussed in more
detail in Appendix C.
The extent to which any or all of these mechanisms contributes to
the total fitting loss is not known. The relative importance of the
various mechanisms probably depends on the type of fitting, the design
of the fitting seal, and whether or not the deck is in contact with the
stored liquid.
Floating decks are typically made by joining several sections of
deck material together, resulting in seams in the deck. To the extent
that these seams are not completely vapor tight, they become a source of
loss. Generally the same loss mechanisms discussed for deck fittings
may apply to deck seams.
Emissions from internal floating roof tanks can be estimated from
ollowing equations : (Note that these c
freely vented internal floating roof tanks.)
LT = Lw + Lr + Lf
LT = the total loss (Mg/yr)
the following equations : (Note that these equations apply only to
LT = Lw + Lr + Lf + Ld (3"7)
where: i w r T a
where D = tank diameter (ft)
N = number of columns (dimensionless)
F = effective column diameter (ft); 1.0 assumed
L = the rim seal loss (Mg/yr) = (K D) P* M Kr/2205
I I V x*
Lf = the fitting loss (Mg/yr) = (Ff) P My Kc/2205
Ld = the deck seam loss (Mg/yr) = (Fd Kd D2) P My Kc/2205
3-30
-------
K = the rim seal loss factor (Ib mole/ft yr) that for an
average fitting seal is as follows:
Seal system description Kr (1b mo1e/ft
Vapor-mounted primary seal only 6.7
Liquid-mounted primary seal only 3.0
Vapor-mounted primary seal plus
secondary seal 2.5
Liquid-mounted primary seal plus
secondary seal 1.6
D = the tank diameter (ft)
*
P = the vapor pressure function (dimensionless)
P* = 0.068 P/((l + (1 - 0.068 P)0'5)2)
P = the true vapor pressure of the material stored (psia)
M = the average molecular weight of the product vapor
(Ib/lbmole). A typical value for VOL liquids is
80 Ib/lbmole.
KC = the product factor (dimensionless) =1.0 for VOL
2205 = constant (Ib/Mg)
F, = the total deck fitting loss factor (Ibmole/yr)
(Nf Kf ) = [(Nf Kf ) + (Nf Kf )+...+ (N Kf
i Ti Tl Tl T2 T2 n Tn
where:
N
f.= number of fittings of a particular type
(dimensionless). Nf is determined for the
specific tank or estimated from Tables 3-5
and 3-6
I/
f. = deck fitting loss factor for a particular type
1 fitting (Ibmole/yr). Kf is determined for each
fitting type from Table 3-6
n = number of different types of fittings (dimensionless)
3-31
-------
Table 3-5. TYPICAL NUMBER OF COLUMNS AS A
FUNCTION OF TANK DIAMETERS6
Tank diameter range Typical number
D (ft) columns, N^
0 <
85 <
100 <
120 <
135 <
150 <
170 <
190 <
220 <
235 <
270 <
275 <
290 <
330 <
360 <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
: D <
85
100
120
135
150
170
190
220
235
270
275
290
330
360
400
1
6
7
8
9
16
19
22
31
37
43
49
61
71
81
Note: This table was derived from a survey of
users and manufacturers. The actual number of
columns in a particular tank may vary greatly
depending on age, roof style, loading specifi-
cations, and manufacturing perogatives. This
table should not supersede information based
on actual tank data.
3-32
-------
Table 3-6. SUMMARY OF DECK FITTING LOSS FACTORS (Kf) AND
TYPICAL NUMBER OF FITTINGS (Nf)6
Deck fitting loss Typical number
factor, Kf of fittings,
Deck fitting type (Ibmole/yf) (Nf)
1. Access Hatch 1
a. Bolted cover, gasketed 1.6
b. Unbolted cover, gasketed 11
c. Unbolted cover, ungasketed 25
2. Automatic Gauge Float Well 1
a. Bolted cover, gasketed 5.1
b. Unbolted cover, gasketed 15
c. Unbolted cover, ungasketed 28
3. Column Well (see Table 3-5)
a. Built-up column-sliding cover,
gasketed 33
b. Built-up column-sliding cover,
ungasketed 47
c. Pipe column-flexible fabric
sleeve seal 10
d. Pipe column-sliding cover,
gasketed 19
e. Pipe column-sliding cover,
ungasketed 32
4. Ladder Well 1
a. Sliding cover, gasketed 56
b. Sliding cover, ungasketed 76
5. Roof Leg or Hanger Well ,, JD D2 **
a. Adjustable 7.9 ^ 10 600;
b. Fixed 0
6. Sample Pipe or Well 1
a. Slotted pipe-sliding cover,
gasketed 44
b. Slotted pipe-sliding cover,
ungasketed 57
c. Sample well-slit fabric seal,
10% open area 12
Q2 **
7. Stub Drain*, 1-inch diameter 1.2
8. Vacuum Breaker
a. Weighted mechanical actuation,
gasketed 0.7
b. Weighted mechanical actuation,
ungasketed 0.9
* Not used on welded, contact internal floating decks.
** D = tank diameter (ft).
3-33
-------
F, = the deck seam length factor (ft/ft2)
= 0.15, for a deck constructed from continuous metal sheets
with a 7 ft spacing between seams
= 0.33, for a deck constructed from rectangular panels 5 ft
by 7.5 ft
= 0.20, an approximate value for use when no construction
details are known
K. = the deck seam loss factor (Ibmole/ft yr)
= 0.34 for non-welded roofs
= 0 for welded decks
3.3 BASELINE CONTROL AND EMISSIONS ESTIMATES
The baseline control level is set by state regulations that affect
VOL storage vessels. The control requirements are set forth in the
State implementation plans (SIP). A typical SIP requires tanks with
capacities greater than 40,000 gallons (=150 m3) storing material with
vapor pressures greater than 1.5 psia (slO.5 kPa), but less than 11 psia
(=76.6 kPa), to have a floating roof. For this group of tanks, baseline
control is assumed to be the noncontact internal floating roof with a
vapor-mounted primary seal, because it is the least costly means of
complying with the SIPs. A typical SIP requires tanks with capacities
greater than 40,000 gallons (=150 m3) storing liquids with vapor pressures
greater than 11 psia (=76.6 kPa) to either have vapor recovery systems
or to be constructed as high pressure vessels. Therefore, vapor recovery
is assumed to be the baseline control for this group of tanks.
Texas contains an estimated 35 percent of the total national VOL
tank population and has an atypical SIP. Texas requires tanks with
capacities greater than 25,000 gallons (=95 m3) storing VOL with a vapor
pressure greater than 0.5 psia (=3.5 kPa) but less than 11 psia (=76.6 kPa)
3-34
-------
to have a floating roof. Tanks with capacities greater than 25,000 gallons
(s95 m3) storing VOL with vapor pressures greater than 11 psia (276 kPa)
must have a vapor recovery system. Texas contains such a significant
portion of the tank population that this difference in cutoff size must
be considered in the baseline control level. Therefore, in addition to
the floating roofs in all tanks with capacities greater than 40,000 gallons
(=150 m3) and storing VOL with vapor pressures between 1.5 and 11 psia
(=10.5 and 76.6 kPa), it is assumed that 35 percent of the tanks with
capacities between 25,000 gallons and 40,000 gallons (s95 m3 to 150 m3)
storing VOL with vapor pressures between 0.5 psia and 11.5 psia (=3.5 to
76 kPa) will be constructed with noncontact internal floating roofs with
vapor-mounted primary seals in the absence of a standard of performance.
It is further assumed that 35 percent of the tanks that have capacities
between 25,000 gallons and 40,000 gallons (s95 m3 and 150 m3) storing
VOL with vapor pressures greater than 11 psia (=76.6 kPa), will be
constructed with vapor recovery systems or stored in pressure vessels.
This is in addition to the vapor recovery systems or pressure vessels
for all tanks greater than 40,000 gallons (=150 m3) and storing VOL with
vapor pressures exceeding 11 psia (76.6 kPa).
The remaining 65 percent of the tanks that have capacities between
25,000 gallons (s95 m3) and 40,000 gallons (=150 m3) and storing materials
with vapor pressures between 0.5 and 1.5 psia (S3.5 and 10.5 kPa) are
assumed to be uncontrolled, fixed-roof tanks. It is assumed that every
tank smaller than 25,000 gallons (s95 m3) and every tank storing material
with a vapor pressure less than 0.5 psia (s3.5 kPa) will be constructed
as an uncontrolled, fixed-roof tank. Figure 3-11 summarizes the baseline
control assumptions.
The total VOC emission rate from VOL storage vessels is estimated
to be 37,800 Mg/yr based on the 1977 tank population described in
Section 3.1 and the baseline control levels. This estimate assumes that
currently existing or developing state regulations are fully implemented
on the 1977 tank population. Included in this emissions total are an
estimated 34,000 Mg/yr of VOC emitted from fixed roof tanks and an
estimated 3,800 Mg/yr of VOC from floating roof tanks. The 37,800 Mg/yr
emissions total is broken down among the three vapor-pressure/tank-size
3-35
-------
1
1
1
1
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o c '
f- S. 1
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1
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o vi •<-> en i
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01 VI C (O •!-
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3anss3ad
3-36
-------
regions that comprise the baseline control level scenario in Figure 3-12.
Note that the number of tanks storing liquids with vapor pressures
greater than 58.7 kPa (8.5 psia) is less than 1 percent of the tank
population. These tanks have very little effect on the estimated number
of tanks and emissions listed in Figure 3-12.
3-37
-------
11.0
cv*
I
1.5
1.0
0.5
Number of tanks
Emissions
Fixed roof 0
Floating roof 2,786
Total 2,786
0
3.000
3,000
Number of tanks
Fixed roof
Floating roof
Total
Emissions
(mg/yr)
13,100
800
2,878 13,900
Number of tanks
Fixed roof 21,876
Floating roof 0
Total 21,876
J
Emissions
(mg/yr)
20,900
0
20,900
20
30
35
40
TANK VOLUME (103 gallons)
Figure 3-12.
Baseline emissions totals (mg/yr; 1977 tank population)
and numbers of tanks by vapor pressure/tank size region,
3-38
-------
3.4 REFERENCES
1. Erickson, D. G. Emission Control Options for the Synthetic Organic
Manufacturing Industry; (Unpublished draft submitted in fulfillment
of EPA Contract No. 68-02-2577). Hydroscience, Inc. Knoxville,
Tennessee. October 1978. 97 p.
2. Radian, Inc. The Revised Organic Chemical Producers Data Base
System, Final Interim Report; (Submitted in fulfillment of EPA
Contract No. 68-03-2623.) Austin, Texas. March 1979.
3. Booz, Allen, and Hamilton, Foster D. Snell Division. Cost of
Hydrocarbon Emissions Control to the U.S. Chemical Industry (SIC 28).
Manufacturing Chemists Association. Florham Park, New Jersey.
December 1977.
4. Memorandum from Rockstroh, M. A., TRW to Moody, W. T., TRW.
February 1, 1980.
5. International Liquid Terminals Association. Bulk Liguid Terminals
and Storage Facilities, 1979 Directory. Washington, D.C. 1979.
85 p.
6. The American Petroleum Institute (API) Draft Document, Evaporation
Loss from Internal Floating Roof Tanks. API Publication 2519.
Third Edition. 1982.
7. RFI Services Corporation. The Woodlands, Texas. Figures extracted
from promotional literature with the permission of the company.
8. U.S. Environmental Protection Agency. Measurements of Benzene
Emissions from a Floating-Roof Test TanEReport No. EPA-450/3-79-020.
Research Triangle Park, North Carolina. June 1979.
9. Brown Boiler and Tank Works, Ltd. Franklin, Pennsylvania. Figure
extracted from promotional literature with the permission of the
company.
10. Ultraflote Corporation. Houston, Texas. Figure extracted from
promotional literature with the permission of the company.
11. U.S. Environmental Protection Agency. Compilation of Air Pollution
Emission Factors. Report No, AP-42; Supplement 12, Research Triangle
Park, North Carolina. April 1981.
12. TRW Environmental Division, Background Documentation for Storage of
Organic Liquids. EPA Contract No. 68-02-3174. Research Triangle
Park, N.C. May 1981.
13. U.S. Environmental Protection Agency, Draft Volume II Background
Information Document for Benzene Storage Hazardous Air Pollutant
Standards, EPA 450/ , January 1983.
3-39
-------
4. CONTROL TECHNIQUES
This section describes the control techniques applicable to emissions
of volatile organic compounds (VOC) from the storage of volatile organic
liquids (VOL). It should be recognized that the emission sources in
this industry are "un-traditional" in the sense that they do not have
exhaust streams that normally are controlled by add-on control devices.
Consequently, the evaluation of control techniques is not a straight-forward
process of identification, testing and direct comparison of a series of
add-on devices. Rather, it is the comparison of alternative tank types
and equipment options that can be selected for use in storing VOL.
4.1 OVERVIEW
As discussed in Chapter 3, there are three major types of vessels
used to store VOL: fixed roof tanks, internal floating roof tanks, and
external floating roof tanks. In addition, optional equipment designs
exist within each major tank type (e.g. seal design, roof fabrication
fittings closure). Each tank type and equipment option has its own
associated emissions rate. In effect, there is a spectrum of equipment
options, with a corresponding spectrum of emission rates. The control
techniques to be evaluated are these alternative storage vessel equipment
types.
The major equipment options that affect emissions from the storage
of VOL include:
• the tank type: fixed roof, internal floating roof, or external
floating roof;
• the floating roof deck type: welded or bolted (pertinent to
internal floating roof tanks only);
-------
0 the floating roof primary seal location: liquid- or vapor-mounted
(pertinent to internal and external floating roof tanks);
0 the types of deck fittings: controlled or uncontrolled (pertinent
to internal floating roof tanks only);
• the floating roof seal system: primary seals only or primary
and secondary seals (pertinent to internal and external floating
roof tanks); and
• the use of add-on vapor control techniques: incinerators,
adsorbers, or refrigerated condensers (pertinent to fixed roof
tanks only).
Considering the optional types of equipment that can be used to
store VOL, a hierarchy of equipment alternatives can be developed based
on emission rate. This hierarchy, in order of decreasing emission
rates, is listed in Table 4-1. The types of storage vessel equipment
listed in Table 4-1 are described in detail in Chapter 3. Chapter 3
also outlines equations for estimating the emission rate for each of the
major tank types and the equipment options that are available. These
equations and the test data used to develop the equations (discussed in
Appendix C) form the basis for evaluating the effectiveness of the
control techniques discussed in this chapter.
The hierarchy of equipment options presented in Table 4-1 suggests
that the emission rate of each control option relative to the others
remains constant over all situations that may be found in the VOL storage
industry. This is the case among the internal floating roof tanks,
fixed roof tanks, and external floating roof tanks with liquid-mounted
primary and secondary seals (Options 1, 3-7, and 9 in Table 4-1). For
the most part, the relationship also holds true over the range of conditions
(e.g. vapor pressure, number of turnovers, etc.) commonly found in the
industry for the vapor recovery or control and for the external floating
roof tank, vapor-mounted primary and secondary seal (Options 2 and 8 in
Table 4-1). The ranking of these two options, however, does vary with
the tank size and the vapor pressure of the material stored. To illustrate
the relative emission rates of the equipment options, the total emission
rates for each option for a range of tank sizes (100 to 10,000 m2) has
4-2
-------
Table 4-1. HIERARCHY OF EQUIPMENT TYPES BASED ON EMISSIONS RATE'
Control
Option
1
2b
Equipment description
Fixed roof tank (baseline)
External floating roof tank, vapor-mounted
Abbreviated
notation
Fixed roof tank
EFR
primary and secondary seals
Internal floating roof tank, bolted construc-
tion (contact or noncontact), vapor-mounted
primary seal only, with uncontrolled deck
fittings
Internal floating roof tank, bolted construc-
tion (contact or noncontact), liquid-mounted
primary seal only, with uncontrolled deck
fittings
Internal floating roof tank, bolted construc-
tion (contact or noncontact), liquid-mounted
primary seal only, with controlled deck
fittings
Internal floating roof tank, bolted construc-
tion (contact or noncontact), liquid-mounted
primary and secondary seals, with controlled
deck fittings
Internal floating roof tank, welded construc-
tion (steel pan or FRP deck), liquid-mounted
primary and secondary seals, with controlled
deck fittings
Fixed roof tank with thermal oxidation,
carbon adsorption or refrigerated condenser
add-on vapor recovery equipment
External floating roof tank, deck types are
welded construction, liquid-mounted primary
and secondary seals, controlled deck fittings
are not applicable
vm,ss
bIFRlm
bIFRlm,cf
TCD
birKlm,cf,ss
wIFRlm,cf,ss
Vapor recovery
or control
EFR
1m,ss
Listed in order of decreasing emission rates; Control Option 1
possessing the largest emission rate and Control Option 9 possessing
the smallest emission rate.
3The rank based on emissions rate for this option varies depending on
the specific parameters (e.g., number of turnovers, tank size) of
the tank being considered.
4-3
-------
been calculated and plotted in Figures 4-1 and 4-2. Figures 4-1 and 4-2
are for tanks with 50 and 10 turnovers per year, respectively. The
plotted emission rates are for a stored VOL with a vapor pressure (in
liquid and condensed vapor phase) of 34.5 kPa (5 psia). (See Figures 4-1
and 4-2.)
Apart from the intrinsic emission-affecting characteristics of each
tank type and equipment option, the emission rate from all storage
vessel types is affected by the vapor pressure of the material stored
and the frequency of tank turnovers. The impact of the vapor pressure
and the turnover rate on the emission rate, however, varies among the
three major tank types. Consequently, the hierarchy of equipment-types,
or the relative emission rates of the various equipment types, can be
affected by these variables. Comparison of Figures 4-1 and 4-2 illustrates
the effects of turnovers. The tank scenarios, for which emission rates
are plotted, are identical in these figures except for the turnover
rate. Figure 4-1 is for tanks experiencing 50 turnovers per year and
Figure 4-2 is for tanks experiencing 10 turnovers per year. It can be
seen that decreasing the annual turnover rate from 50 to 10 decreases
the emission rate for fixed roof tanks and fixed roof tanks with vapor
recovery or control systems; conversely, the turnover rate has very
little effect on internal and external floating roof tank emission
rates: consequently, the higher the turnover rater the larger the
difference between fixed roof and floating roof tank emission rates.
The rank or relative effectiveness of fixed roof tanks equipped with
vapor recovery or control devices is adversely affected by an increase
in the turnover rate (i.e., the relative effectiveness as a control
technique decreases).
The effects that the vapor pressure of the stored VOL has on the
relative emission rates of the equipment options are not illustrated by
Figure 4-1. As the vapor pressure of the stored liquid increases, the
emission rates from both fixed and floating roof tanks increase. However,
the vapor pressure functions in the equations used to estimate losses
from fixed and floating roof tanks differ, and, therefore, the percent
increase in floating roof tank emissions is greater than the percent
4-4
-------
1,000
CD
QJ
to
O
to
100
10
1.0
0.1
0.01
10
100
1,000
10,000
-(2)
-(3)
-(5)
-(6)
-(4)
Tank Capacity (fr)
Figure 4-1. Emissions rates for alternative equipment types
(50 turnovers per year; vapor pressure = 1.0 psia).
4-5
-------
1,000
100
QJ
4->
(B
I/)
to
10
1.0
0.1
0.01
w""lm,cf,ss.
S(5> = EFRms
- EFRms,ss
10
100
Tank Capacity (M
,000
10,000
Figure 4-2. Emissions rates for alternative equipment types
(10 turnovers per year; vapor pressure =1.0 psia).
4-6
-------
increase in fixed roof tank emissions for a similar increment in vapor
pressure. (Note that this trend may reverse above 8.5 psia depending on
the ratio of fixed roof tank breathing losses to working losses.)
Consequently, an increase in vapor pressure decreases the difference
between fixed and floating roof tank emission rates. This is opposite
to the effect of the turnover rate. Within the range of conditions
commonly found in VOL storage vessels, however, neither the effect of
the vapor pressure nor the turnover rate changes the rank of the fixed
roof tank and floating roof tank equipment options.
Because the emission rate from all types of tanks is affected by a
number of tank variables (i.e., vapor pressure, tank size, turnovers,
the nature of the VOL), a single model tank is used as a common basis
for evaluating effectiveness. The model tank has the following
characteristics:
• tank diameter - 9.1 m (30 ft);
• tank height - 9.1 m (30 ft);
• tank capacity - 606 m3 (160,000 gallons);
• vapor pressure of the VOL stored - 6.9 kPa (1 psia);
t density of VOL stored - 7.4 Ib/gallon;
• molecular weight of the product vapor - 80 Ib/lbmole; and
• turnover rate - 50 per year.
The emissions associated with the model tank under each equipment
option have been estimated with the equations presented in Chapter 3 and
listed for comparison in Table 4-2. The significance of these emission
estimates are discussed in the following sections.
4.2 FIXED ROOF TANKS
A fixed roof tank is the minimum acceptable equipment currently
employed for the storage of VOL. The discussion of control techniques,
therefore, will relate the effectiveness of alternative storage equipment
types to the effectiveness of fixed roof tanks. Working and breathing
losses normally incurred from the storage of VOL in fixed roof tanks can
be reduced in any of the following ways:
(1) by the installation of an internal floating roof with rim
seals;
4-7
-------
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-------
(2) by the construction of an external floating roof tank with
liquid-mounted primary and secondary seals in lieu of a fixed
roof tank; and
(3) by the installation and use of a vapor recovery system (e.g.,
carbon adsorption or refrigerated condensation) or a vapor
control system (e.g., incineration).
This list defines only the major types of control techniques applicable
to the storage of VOL. Optional equipment designs that influence the
effectiveness of minimizing VOL emissions exist within each major type
of control technique. The following sections discuss the relative
effectiveness of these equipment options.
4.3 INTERNAL FLOATING ROOF TANKS
Internal floating roof tanks with rim seal systems emit less VOC
per unit of storage than fixed roof tanks. In new and replacement tank
situations, internal floating roof tanks can be constructed in lieu of
fixed roof tanks. In this sense they are a control technology for fixed
roof tanks. Internal floating roofs also can be used directly as a
control device for existing fixed roof tanks. This requires minor
modifications to the tank shell (e.g., cutting roof vents).
Depending on the type of roof and seal system selected, an internal
floating roof in the model fixed roof tank will reduce the emission rate
by 93.4 to 97.3 percent. An internal floating roof, regardless of
design, reduces the area of exposed liquid surface in the tank. Reducing
the area of exposed liquid surface, in turn, decreases the evaporative
losses. The largest emissions reduction available from the control
options is achieved by the presence of the floating roof vapor barrier
that precludes direct communication between a large portion of the
liquid surface and the atmosphere. All internal floating roofs share
this design benefit. The relative effectiveness of one internal floating
roof design over another, therefore, is a function of how well the
floating roof can be sealed.
From an emissions standpoint, the most basic internal floating roof
design is the noncontact, bolted, aluminum, internal floating roof with
a single vapor-mounted wiper seal. As discussed in Section 3.2.4.3,
4-9
-------
there are four types of losses from this roof design. These losses with
an estimate of their respective percentage contributions to the total
loss from the model tank are as follows:
(1) rim or seal losses; 32%
(2) fitting losses; 51%
(3) deck seam losses; and 10%
(4) withdrawal losses. 7%
With the exception of withdrawal losses, which are inherent in all
internal floating roof designs, the losses listed above can be reduced
by employing roofs with alternative design features. Table 4-3 lists
alternative floating roof equipment designs and the model tank emission
rate associated with each type of equipment. Table 4-3 is calculated
from the emission estimates in Table 4-2 by adding the appropriate
emission components for each case. The following sections elaborate on
the alternative equipment that can be employed on internal floating
roofs. The discussion is arranged according to the major emissions
categories.
4.3.1 Controls for Fitting Losses
Fitting losses occur through the penetrations in an internal floating
deck. Penetrations exist to accommodate the various types of fittings
that are required for proper operation of an internal floating roof.
Fitting losses can be controlled with gasketing and sealing techniques,
or by the substitution of a lower emitting fitting type that serves the
same purpose. Table 4-4 lists the fitting types that are pertinent to
emissions and an abbreviated description of the equipment that is considered
to be representative of "uncontrolled" fittings and "controlled" fittings.
Certain fitting types are not amenable to control. These are not listed
in Table 4-4. Section 3.2.3 provides a more detailed description of the
various fitting types and the "control techniques" that can be applied.
The effectiveness of fitting "controls" at reducing the overall
emission rate is a function of the number of fittings of each type that
are employed on a given tank. On the model tank, which is representative
of a typical medium sized tank, fitting "controls" reduce the total
4-10
-------
Table 4-3. EFFECTIVENESS OF INTERNAL AND EXTERNAL ,
FLOATING ROOF TANKS COMPARED TO A FIXED ROOF TANK FOR THE MODEL TANKJ
Internal
or external
roof tank
floating
Fixed roof tank
Case Equipment type*
Total emission
rate (Mg/yrr
Reduction over
fixed roof tank
emission rate
Total emission rate 1
6.22 Mg/yr
(Working loss = 5.34) 2
(Breathing loss = 0.88)
3
4
5
6
7
8
9
10
11
12
13
.IFR
b vm
bIFRvm,cf
bIFRvm,cf,ss
bIFRlm
bIFRlm,cf
TFR
b1 Klm,cf,ss
TFR
wirKlm,cf,ss
EFR4
vm
EFR4
vm,ss
EFRL
1m
EFR4
1m, ss
EFR4
ms
EFR4
ms.ss
0.408
0.308
0.228
0.338
0.238
0.211
0.171
4.62
1.55
0.24
0.064
0.76
0.068
93.4%
95.0%
96.3%
94.6%
96.2%
96.6%
97.3%
25.7%
75.1%
96.1%
99.0%
87.8%
98.9%
Model tank is 160,000 gallons capacity; 30 feet in diameter, 30 feet in
height, 1 psia vapor pressure, 80 Ib/lbmole molecular weight of product and
condensed product vapor and 50 turnovers per year.
7
"Nomenclature explanation - .IFR f - The subscript b or w indicates a
bolted or welded roof deck; IFR TnSicates an internal floating roof type; EFR
indicates an external floating roof tank type; the subscript vm, 1m, or ms
indicates a vapor-mounted, liquid-mounted or metallic shoe primary seal; the
subscript cf indicates controlled fittings as described in the notes of
Table 4-2; lack of the cf subscript indicates uncontrolled fittings; the
subscript ss indicates a rim-mounted secondary seal; a lack of the ss
subscript indicates that no secondary seal is employed.
Sum of seal loss, fitting loss, deck loss and working loss from Table 4-2.
External floating roofs are all welded construction and do not incur
appreciable deck seam losses.
4-11
-------
Table 4-4. "CONTROLLED" AND "UNCONTROLLED"
INTERNAL FLOATING ROOF DECK FITTINGS
Deck fitting type
Equipment descriptions
Uncontrolled
Controlled
1. Access hatch
2. Automatic gauge
float well
3. Column wel1
4. Ladder well
5. Sample pipe or
well
6. Vacuum breaker
Unbolted, ungasketed cover*;
or unbolted, gasketed
cover
Unbolted, ungasketed cover*;
or unbolted, gasketed
cover
Built-up column-sliding
cover, ungasketed*;
built-up column-sliding
cover, gasketed;
pipe column-sliding cover,
ungasketed; or
pipe column-sliding cover,
gasketed
Ungasketed sliding cover* Gasketed sliding cover
Bolted, gasketed cover
Bolted, gasketed cover
Pipe column-flexible
fabric sleeve seal
Slotted pipe-sliding cover,
ungasketed; or
slotted pipe-sliding cover,
gasketed
Weighted mechanical
actuation, ungasketed*
Sample well with slit
fabric seal, 10% open
area*
Weighted mechanical
actuation, gasketed
*The fittings assumed in the uncontrolled case for estimating the effective-
ness of fittings controls are marked with a single asterisk in the above
table. This fittings scenario is representative of no single tank, but
rather is the composite of what is estimated based on a survey of users and
manufacturers to be typical of fittings on the majority of tanks currently
in service. Note that the sample well with split fabric seal was used in the
"uncontrolled" case for calculating emissions because it is in common use.
It was also used in the "controlled" case because it is the lowest emitting
fitting type.
4-12
-------
fitting loss by about 48 percent. Since fitting losses are about 51 percent
of the total internal floating roof tank loss (i.e., for an IFR case),
the fitting "controls" reduce the overall internal floating roof tank
emission rate by about 25 percent over the IFR without fitting controls.
The additional emission reduction obtained by controlling fitting emissions
increases the control efficiency of the IFR from 93.4 percent to
95.0 percent over a fixed roof tank as the base case.
4.3.2 Controls for Seal Losses
Internal floating roof seal losses can be minimized in either of
two ways or their combination:
(1) by employing liquid-mounted primary seals instead of vapor-mounted
seals;
(2) by employing secondary wiper seals in addition to primary
seals.
All seal systems should be designed, installed and maintained to
minimize the gap between the seals and the tank shell. The test data
discussed in Appendix C support the general conclusion that seal losses
increase rapidly when the seal gap exceeds 63.5 square centimeters per
meter of tank diameter (3 inVft diameter). Below this level, the
effect of seal gap on seal loss is much less pronounced.
The effectiveness of alternate internal floating roof seal systems
can be evaluated through inspection of the rim seal loss factors (K )
that have been developed based on test data (summarized in Appendix C)
for estimating losses for various seal systems. These factors are
listed in Table 4-5. (Note these factors are for seals with average
gaps.) Also listed in Table 4-5 are control efficiency and incremental
control efficiency estimates. The control efficiency estimates (column 3
in Table 4-5) indicate the effectiveness of the various seal systems at
reducing emissions over the level achieved by a vapor-mounted primary
seal. (Note that the vapor-mounted primary seal is assumed to be the
baseline control level to provide a common basis of comparison.) The
incremental control efficiency estimates (column 4 in Table 4-5) demonstrate
the effectiveness of each seal system relative to the next less stringent
seal system (i.e., the next higher emitting seal system). These
efficiencies are calculated directly from the Kr values.
4-13
-------
Table 4-5. INTERNAL FLOATING ROOF RIM SEAL SYSTEMS
SEAL LOSS FACTORS AND CONTROL EFFICIENCIES
Seal loss control
K efficiency related Incremental
Seal system (Ib-mole/ft-yr) to baseline control efficiency
Vapor-mounted
primary seal only
Liquid-mounted
primary seal only
Vapor-mounted
primary and
secondary seals
Liquid-mounted
primary and
seconadary seals
6.7
3.0
2.5
1.6
IFR baseline (0%)
55%
63%
76%
55%
17%
36%
4-14
-------
Application of a liquid-mounted primary and secondary seal system
in place of a vapor-mounted primary seal would reduce seal losses an
estimated 76 percent. On the model tank, where these seal losses represent
roughly one-third of the total loss from the tank (i.e., .IFR case),
this 76% reduction in seal losses translates to a 24% reduction in the
total loss from the floating roof tank. Relative to fixed roof tank
emissions, the additional control provided by the liquid-mounted primary
and secondary seal system over the vapor-mounted primary seal system
increases the effectiveness of the internal floating roof from 95.0 percent
to 96.2 percent. (See Case 2 vs. Case 5 in Table 4-3.)
The currently available emissions test data suggest that the location
of the seal (i.e., vapor- or liquid-mounted) and the presence of a
secondary seal are the primary factors affecting seal losses. A liquid-
mounted primary seal has a lower emissions rate and thus a higher control
efficiency, than a vapor-mounted seal. A secondary seal, be it in
conjunction with a liquid- or a vapor-mounted primary seal, provides an
additional level of control. The emission test data (addressed in
Appendix C) and the corresponding equations for estimating emissions
(presented in Chapter 3) indicate that the type of seal employed (i.e.,
resilient tube seal, liquid-filled seal, etc.) plays a less significant
role in determining the emissions rate. The type of seal is important
only to the extent that the seal must be suitable for the particular
application to which it is applied. For instance, a blade-type,
elastomeric, wiper seal is commonly employed as a vapor-mounted primary
seal or as a secondary seal for an internal floating roof. Because of
its shape and materials of construction, this seal may not be suitable
for use as a liquid-mounted primary seal. Resilient foam-filled tube
and wedge shaped seals, on the other hand, can be used as both liquid-
and vapor-mounted seals. Section 3.2.2 provides additional information
on the types of seals that are suitable for various applications. The
point to be made here, however, is that the seal type has a small impact
on seal losses relative to the impact of the location of the seal and
the presence of a secondary seal. Appendix C addresses the test data
pertinent to this conclusion.
4-15
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4.3.3 Deck Seam Losses
Depending on the type of floating roof employed, deck seam losses
can contribute to the total loss from an internal floating roof. For
the model tank used as a basis for comparison throughout this section
(i.e., tJFRvm), deck seam losses are 10% of the total loss. When seal
losses and fitting losses are controlled, the relative contribution to
the total loss from deck seams increases. In the case of a bolted,
noncontact, internal floating roof with liquid-mounted primary seals,
controlled deck fitting losses, and secondary seals (. IFR, f ),
3 J b lm,cf,ss
deck seam losses contribute about 20 percent of the total loss.
Deck seam losses are inherent in several floating roof types. Any
roof constructed of sheets or panels fastened by mechanical fasteners
(bolted) is expected to experience deck seam losses. Two roof types
were tested to determine deck seam losses (see Appendix C). The first
was a bolted, aluminum, noncontact roof and the second was a bolted,
aluminum panel-type, contact roof. The design of the mechanical fasteners
employed on these two roof types varies significantly. In addition,
one roof type floats above the liquid surface while the other floats in
contact with the liquid surface. Despite these differences, the seams
on these two roof types were found to emit at roughly the same rate per
meter of seam. Deck seam losses, therefore, are considered to be a
function of the length of the seams only and not the type of the seam or
its position relative to the liquid surface.
The control for deck seam losses is achieved by selection of a roof
type with vapor-tight deck seams. The welded deck seams on steel pan
roofs are vapor tight. Also, it is likely that the fiberglass lapped
seams of a glass fiber reinforced polyester roof (FRP) are vapor tight
as long as the permeability of the liquid through the seam lapping
materials is negligible. Some manufacturers provide gaskets for bolted
metal deck seams. Deck seam gaskets also may retard deck seam losses by
providing an additional barrier to diffusion and other possible deck
seam loss mechanisms. The permeability of the liquid through the gasketing
material also would be a factor. No test data are available to evaluate
the effects of gaskets on deck seam losses.
4-16
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Selection of a welded roof rather than a bolted roof will eliminate
deck seam losses. The elimination of deck seam losses improves the
overall effectiveness relative to a fixed roof tank of an internal
floating roof with liquid-mounted primary seals, secondary seals and
controlled fitting losses from a 96.6 to 97.3 percent control efficiency
(see Case 6 vs. Case 7 in Table 4-3).
4.4 EXTERNAL FLOATING ROOF TANKS
External floating roof tanks emit less VOC per unit of storage
capacity than fixed roof tanks. Depending on the rim seal system employed,
they also can emit less VOC per unit of storage capacity than internal
floating roof tanks. In the sense that external floating roof tanks may
be used in place of fixed or floating roof tanks in new or replacement
tank situations, they represent a control technology for the storage of
VOL.
External floating roof tanks do not experience the fitting losses
or deck seam losses that occur with most internal floating roof tanks.
The external floating roof tanks are constructed almost exclusively of
welded steel. This accounts for the absence of deck seam losses.
Further, because of the roof design, few if any deck penetrations are
necessary to accommodate fittings.
Penetrations in an external floating roof tank generally are needed
only for some types of antirotation guides and emergency liquid drains.
These fitting types are not employed on all external floating roofs.
Because the number of deck penetrations in an external floating roof is
small relative to the number in an internal floating roof, fitting
losses from external floating roof tanks are assumed to be negligible.
No emission test data, however, are available to verify this assumption.
Rim seal losses and withdrawal losses that are similar in nature to
those experienced by internal floating roof tanks, do occur with external
floating roof tanks. The only difference in this respect between external
floating roofs and internal floating roofs is that the external floating
roof seal losses are believed to be dominated by wind induced mechanisms.
Withdrawal losses in external floating roof tanks, as with internal
floating roof tanks, are entirely a function of the turnover rate and
4-17
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inherent tank shell characteristics. No control measures have been
identified that are applicable to withdrawal losses from floating roof
tanks.
Rim seal losses from external floating roof tanks vary depending on
the type of seal system employed. As with internal floating roof rim
seal systems, the location of the seal (i.e., vapor- or liquid-mounted)
is the most important factor affecting the effectiveness of resilient
seals for external floating roof tanks. Liquid-mounted seals are more
effective than vapor-mounted seals at reducing rim seal losses. Metallic
shoe seals, which commonly are employed on only external floating roof
tanks, are more effective than vapor-mounted resilient seals but less
effective than liquid-mounted resilient seals.
The relative effectiveness of the various types of seals can be
evaluated by analyzing the seal factors (K factor and wind velocity
exponent, N) contained in Table 3-4 of the previous chapter. These seal
factors were developed on the basis of emission tests conducted on a
pilot scale tank. The results of the emission tests are published in an
American Petroleum Institute bulletin. To compare the relative
effectiveness of the alternate seal systems, the seal factors were used
with an assumed wind velocity (10 MPH) to generate directly comparable
emission factors. These factors, which have meaning only in comparison
to one another, are listed in Table 4-6 for alternative seal systems.
In addition, the table contains control efficiencies (relative to the
least effective seal system) and incremental control efficiencies (relative
to the next higher emitting seal system) calculated directly from the
emission factors. From the information in Table 4-6, it is clear that
vapor-mounted primary seals on external floating roof tanks are
significantly less effective than liquid-mounted or metallic shoe primary
seals. Further, secondary seals provide an additional measure of control.
Considering the model tank that is used as a basis of comparison
throughout this chapter, an external floating roof tank with liquid-mounted
primary seals has about the same effectiveness as an internal floating
roof tank with liquid-mounted primary seals and controlled fitting
losses (see Case 10 vs. Case 5 in Table 4-3). An external floating roof
4-18
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Table 4-6. EXTERNAL FLOATING ROOF TANK
SEAL SYSTEM CONTROL EFFICIENCIES3
Seal system description
Emissions
factor N
Ks (10)"
Seal loss
control .
efficiency
Incremental seal
loss control
efficiency
Vapor-mounted resilient
primary seal only
Vapor-mounted resilient
primary seal and
secondary seal
Metallic shoe primary
seal only
Metallic shoe primary
seal with a shoe-
mounted wiper seal
Liquid-mounted resilient
primary seal only
Metallic shoe primary
seal with rim-mounted
secondary seal
Liquid-mounted resilient
primary seal with rim-
mounted secondary seal
239 EFR assumed
baseline seal
technology
80 66%
38 84%
13 95%
11 95%
2.0 99%
1.8 99%
66%
53%
66%
Negligible
difference
82%
Negligible
difference
For well designed seal systems with "average" gaps between the seal and
the tank shell. Calculated from the K and N values listed in
Table 3-4. s
Rim seal loss control efficiency relative to the least effective seal
alternative.
cRim seal loss control efficiency relative to the next less effective
seal alternative.
4-19
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tank with liquid-mounted primary and secondary seals yields the highest
level of control achievable with the floating roof tank technology. A
welded internal floating roof tank with liquid-mounted primary and
secondary seals and controlled fitting losses reduces emissions over the
fixed roof tank level by about 97.3 percent (see Case 7 in Table 4-3).
An external floating roof tank with liquid-mounted primary and secondary
seals exceeds this control level and achieves an estimated 99.0 percent
reduction in emissions over the fixed roof tank level. The percentage
reduction in emissions over the fixed roof tank case will vary, of
course, with tank characteristics (e.g., tank size, vapor pressure of
material stored). The external floating roof with liquid-mounted primary
and secondary seals, however, remains the most effective floating roof
tank technology from an emissions reduction standpoint. It must be
recognized that this conclusion, as with all the conclusions in this
chapter about the relative effectiveness of floating roof designs, is
based on the results of emission tests conducted on a pilot scale tank
(summarized in Appendix C). The test program was extensive in nature,
but caution must be exercised when extrapolating results and conclusions
to full size facilities that can be influenced by a large number of
factors that cannot be easily controlled in a real environment (e.g.,
wind speed, temperature, etc.).
4.5 VAPOR CONTROL OR RECOVERY SYSTEMS ON FIXED ROOF TANKS
Losses from fixed roof tanks can be reduced by collecting the
vapors and either recovering or oxidizing the VOC. In a typical vapor
control system, vapors remain in the tank until the internal pressure
reaches a preset level. A pressure switch, which senses the pressure
buildup in the tank, then activates blowers to collect and transfer the
vapors through a closed vent system. A redundant blower system is
provided in this service to ensure that no vapors will be released to
the atmosphere in the event of a primary blower malfunction. The closed
vent system ducts the vapors to a recovery or oxidizer unit.
To prevent flashbacks from the control equipment, the vapors in the
closed vent system from the tank may be saturated above the upper explosive
limit in a saturator. Other safety precautions also are exercised such
4-20
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as nitrogen blanketing and use of flame arresters. The particular
precautions employed vary widely depending on the design of individual
systems and the operating preference of individual companies.
4.5.1 Carbon Adsorption
Although there is little commercial operating experience for VOL
applications of carbon adsorption, carbon adsorption for recovery of
other organic vapors has been demonstrated, and the application of this
4
technology to VOL recovery should not be difficult. The general principle
of adsorption is described below to facilitate the description of a
carbon adsorption unit.
Carbon adsorption uses the principle of carbon's affinity for
nonpolar hydrocarbons to remove VOC from the vapor phase. Activated
carbon is the adsorbent; the VOC vapor that will be removed from the
airstream is referred to as the adsorbate. The VOC vapor is adsorbed by
a physical process at the surface of the adsorbent. The proposed VOC
carbon adsorption unit consists of a minimum of two carbon beds plus a
regeneration system. Two or more beds are necessary to ensure that
one bed will be available for use while the other is being regenerated.
The carbon beds can be regenerated using either steam or vacuum
(Figure 4-3). In steam regeneration, steam is circulated through the
bed, raising the VOC vapor pressure. The vaporized VOC is thus removed
with the steam. The steam-VOC mixture is condensed, usually by an
indirect cooling water stream, and routed to a separator. The VOL is
then decanted and returned to storage, and the contaminated water is
sent to the plant wastewater system for treatment. Cooling water,
electricity, and steam are the required utilities for a steam regeneration
system. The other method of regenerating the carbon, vacuum regeneration,
is performed by pulling a high vacuum on the carbon bed. The VOC vapor
desorbed by this process is condensed and returned to storage.
4.5.2 Oxidation Units
Thermal and catalytic oxidizers have been used successfully to
dispose of VOC vapors in other industries. Thermal oxidation is the
most direct means of VOC vapor disposal, uses the fewest moving parts
and is the simplest to operate. The vapor mixture is injected via a
4-21
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4-22
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burner manifold into the combustion area of the incinerator. Pilot
burners provide the ignition source, and supplementally fueled burners
add heat when required. The amount of combustion air needed is regulated
by temperature-controlled dampers. Figure 4-4 shows a typical thermal
oxidation unit.
Flashback prevention and burner stability can be achieved by saturating
the vapors with a suitable hydrocarbon to a concentration above the
upper explosive limit. In addition, two water seal flame arresters can
be used to ensure that flashbacks do not propagate from the burner to
the rest of the closed vent system. As mentioned, safety practices and
equipment vary widely depending on system design and the operating
preference of individual companies. A significant advantage of thermal
oxidizers is that they can dispose of a wide range of VOLs. Fuel
consumption and catalyst repacement are the major cost factors in
considering thermal and catalytic oxidation.
4.5.3 Refrigerated Vent Condensers
A refrigerated vent condenser collects the VOL vapors exiting
through the vents and condenses them. The vents open and close as the
pressure within the tank increases and decreases. Pressure changes
occur when the tank is being filled or emptied, or when the temperature
changes. Condensers are designed to handle the maximum flow rate expected
at any given time, which usually occurs during filling. Freezing of
moisture or VOL is handled by a defrost-separation-recovery system. The
efficiency of vent condensers depends upon the vapor concentration and
the condensing temperature.
4.5.4 Control Efficiencies of Vapor Recovery or Control Systems
The carbon adsorption vapor control system is estimated to reduce
emissions from the VOL storage vessel by approximately 98 percent. This
efficiency is based on a measured carbon adsorption unit efficiency of
98 percent during gasoline loading operations.
The thermal oxidation vapor control system is estimated to reduce
emissions from the VOC storage vessel by approximately 98 percent. This
efficiency is based on a measured thermal oxidation unit efficiency of
98 percent during a wide variety of operations. ' At very low flow
rates, or at low VOC inlet concentrations, somewhat less than 98 percent
of the VOC vapors leaving the storage vessel may be incinerated.
4-23
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OUTLET VAPOR
PILOT
BURNER
FUEL
t-
VAPOR
BURNER
I
STACK
MAIN BURNER
AIR DAMPER
VOL
VAPOR SOURCE
WATER SEAL-
,. 4
Figure 4-4. Thermal oxidation unit.
4-24
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4.6 REFERENCES
1. The American Petroleum Institute (API), Draft Document, Evaporation
Loss from Internal Floating Roof Tanks, API Publication 2519,
Third Edition, 1982.
2. McAllister, Dr. R. Memorandum to the Volatile Organic Liquid
Storage Standard Docket (No. A-80-51) regarding permeability losses
through seal materials and deck seal loss mechanisms. Dated
February 1983.
3. Evaporation Loss from External Floating Roof Tanks. Bulletin
No. 2517. American Petroleum Institute. Washington, D.C. 1980.
4. U.S. Environmental Protection Agency, Evaluation of Control Technology
from Benzene Transfer Operations, Research Triangle Park,
North Carolina, EPA-450/3-78-018, April 1978.
5. Letter from McLaughlin, Nancy D., U.S. Environmental Protection
Agency to D. Ailor, TRW Inc. Comments on the benzene storage model
plants package. May 3, 1979.
6. Letter and attachments from D. C. Mascone, EPA/CPB, to J. R. Farmer,
EPA. June 11, 1980. Memo concerning thermal incinerator performance
for NSPS.
7. U.S. Environmental Protection Agency. Organic Chemical Manufacturing,
Volume 4: Combustion Control Devices. Research Triangle Park,
North Carolina. Publication No. EPA-450/3-80-026. December 1980.
4-25
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5. MODIFICATIONS AND RECONSTRUCTION
After the new source performance standards (NSPS) have been promulgated
in accordance with Section 111 of the Clean Air Act, as amended, all
affected facilities will include those facilities constructed, modified,
or reconstructed after the date of promulgation. The NSPS could also
apply to an existing facility as defined in 40 CFR 60.2. An existing
facility would become an affected facility if it were determined to be
modified or reconstructed. This chapter describes the conditions under
which an existing facility would become subject to the standards of
performance. The enforcement division of the appropriate EPA regional
office would make the final determination as to whether a source were
modified or reconstructed and would therefore become an affected facility.
This chapter also defines potential modifications and reconstructions.
5.1 PROVISIONS FOR MODIFICATIONS AND RECONSTRUCTION
5.1.1 Definition of Modification
It is important that these provisions be understood before considering
examples of potential modifications. Section 60.14 defines modification
as follows:
"Except as provided under paragraphs (e) and (f) of this
section, any physical or operational change to an existing
facility which results in an increase in the emission rate to
the atmosphere of any pollutant to which a standard applies
shall be considered a modification within the meaning of
Section 111 of the Act. Upon modification, an existing facility
shall become an affected facility for each pollutant to which
a standard applies and for which there is an increase in the
emission rate to the atmosphere."
Paragraph (e) lists certain physical or operational changes that
are not considered modifications, regardless of any changes in the
emission rates. These changes are:
-------
1. Routine maintenance, repair, and replacement.
2. An increase in the production rate not requiring a capital
expenditure as defined in Section 60.2.
3. An increase in the hours of operation.
4. Use of an alternative fuel or raw material if, prior to the
standard, the existing facility was designed to accommodate
that alternate fuel or raw material, except for conversion to
coal required for energy consideration.
5. The addition or use of any system or device whose primary
function is the reduction of air pollutants, except when an
emission control system is removed or replaced by a system
considered to be less efficient.
6. The relocation or change in ownership of an existing facility.
Paragraph (b) specifies that an increase in emissions is defined in
kilograms per hour and delineates the methods for determining the increase,
including the use of emission factors, material balances, continuous
monitoring systems, and manual emission tests. Paragraph (c) affirms
that the addition of an affected facility to a stationary source does
not make any other facility within that source subject to standards of
performance. Paragraph (f) simply provides for superseding any
conflicting provisions.
5.1.2 Definition of Reconstruction
Section 60.15 regarding reconstruction states:
"If an owner or operator of an existing facility proposes
to replace components, and the fixed capital cost of the new
components exceeds 50 percent of the fixed capital cost that
would be required to construct a comparable entirely new
facility, he shall notify the Administrator of the proposed
replacements. The notice must be postmarked 60 days (or as
soon as practicable) before construction of the replacements
is commenced. . ."
The reconstruction provision of the regulation prevents an owner or
operator from continuously replacing an operating process, except for
support structures, frames, housing, etc. in an attempt to avoid
compliance with NSPS.
5-2
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5.2 APPLICABILITY TO VOLATILE ORGANIC LIQUID STORAGE
This section outlines the applicability of the modification provisions
to existing plants and describes the applicability of reconstruction to
this industry. This is only a general discussion of changes that would
require an existing facility to comply with the standard. The final
determination would be made by the appropriate EPA regional office on a
case-by-case basis.
5.2.1 Modification Examples
Few, if any, modifications can be made to a storage vessel. Because
replacement of frame, housings, and supporting structures would not
increase emissions from a storage vessel, such a replacement would not
constitute a modification. For the purposes of applicability of these
CAA provisions to a storage vessel, a change in the stored liquid from a
reactive VOC non-emitting liquid to a reactive VOC emitting liquid does
not constitute an operational change; the vessel operation would be
identical for all liquids. A change of liquids, therefore, does not
constitute a modification.
5.2.2 Reconstruction Examples
The reconstruction provision of the regulation is relatively
straightforward in that, regardless of the VOC emission rate, an existing
facility may become an affected facility if the fixed capital cost of
new components exceeds 50 percent of the fixed capital cost of a comparable,
entirely new facility. It is expected that only under catastrophic
circumstances (e.g., total destruction of the storage vessel by fire or
explosion, collapse of an external floating roof or collapse of a fixed
roof) would a facility be affected by the NSPS reconstruction provision.
Because associated structures (frames, housing, etc.) are not part of a
tank, replacement of such a structure would not constitute a reconstruction.
5-3
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6. REGULATORY ALTERNATIVES AND MODEL PLANTS
This chapter defines control options that are to be evaluated as
regulatory alternatives in developing standards of performance for the
storage of volatile organic liquids (VOL). The technologies that constitute
the control options are applicable to specific storage vessel types. A
regulatory alternative refers to a potential requirement that a particular
control technology or an array of technologies (a control option) be
applied to all new, modified, and reconstructed storage vessels. In
evaluating the economic impacts of the regulatory alternatives, model
plants are employed. Both the regulatory alternatives and the model
plants are presented in this chapter.
6.1 REGULATORY ALTERNATIVES
The methodology for selecting the Best Demonstrated Technology (BDT)
for VOL storage vessels focuses on the impacts and costs of applying
control options to specific tank types. Discussions of this methodology
and the selection of BDT are contained in the preamble. The nationwide
environmental and economic impacts of BDT, however, must be evaluated.
Therefore, in order to structure and to perform these analyses, potential
control options that might comprise BDT have been arrayed into regulatory
alternatives.
Three criteria were used to select control options for evaluation
as regulatory alternatives. They are:
1. Potential emission reduction;
2. Cost; and
3. Applicability.
In Chapter 4 the potential control technologies that may reasonably
constitute BDT are identified. Table 4-2 presents the potential emission
reduction obtained by various equipment types on various emission sources,
-------
and Table 4-3 presents the emission reduction obtained over a fixed roof
tank baseline. In Chapter 8, Tables 8-20 through 8-24 present the
individual tank cost effectiveness analysis of potential control
technologies for BDT.
To analyze the impacts of regulatory alternatives, the emissions
from the baseline (no additional Federal regulation) must be calculated.
Therefore, Regulatory Alternative 0 would require no additional equipment
over currently required controls and represents the VOL baseline. All
emissions and costs of subsequent regulatory alternatives are analyzed
relative to the baseline data.
Current regulations (the baseline) allow fixed roof storage vessels
to be constructed in certain size and vapor pressure ranges. Because
BDT could involve internal floating roof tanks, it was decided to examine
the impacts of requiring that fixed roof tanks be constructed as internal
floating roof tanks. As the tables in Chapter 4 demonstrate, building
new internal floating roof tanks with vapor-mounted primary seals and
typical fittings in place of fixed roof tanks, provides a 93 percent
emission reduction in the model storage vessel. (The model vessel is
described in Chapter 4.) This is equivalent to the level of control
required by the NSPS for petroleum liquid storage vessels. This equipment
(internal floating roof, vapor-mounted primary seal, and uncontrolled
fittings) was selected as Regulatory Alternative I.
Internal floating roof tanks have four emission sources. These
are:
1. Rim seal losses;
2. Fitting losses;
3. Deck seam losses; and
4. Working losses.
Equipment that will reduce emissions from these sources is available.
Therefore, potential emission reductions from these sources were examined
for the development of regulatory alternatives.
As demonstrated in Chapter 4, equipping internal floating roof
tanks with liquid-mounted primary seals instead of vapor-mounted primary
seals would provide an additional emissions reduction by decreasing the
rim seal losses. To examine the impacts of this equipment, Regulatory
6-2
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Alternative II would require each tank to be equipped with an internal
floating roof with a liquid-mounted primary seal but would allow
uncontrolled fittings. This alternative would reduce fixed roof tank
emissions by 95 percent.
The next more stringent control option would require an emission
reduction from the fittings on internal floating roof tanks. To examine
the impacts of this equipment, Regulatory Alternative III is formulated
by requiring that the internal floating roof be equipped with a liquid
mounted primary seal and controlled fittings. This alternative would
reduce fixed roof tank emissions by about 96 percent.
At this point in the development of regulatory alternatives all the
emission sources of the internal floating roof with the exception of
working losses and deck seams have been controlled. There are no equipment
controls for working losses, so no regulatory alternative to examine the
impacts of controlling these losses could be developed. In examining
controls for deck seams, the information presented in Tables 8-21 and 8-22
demonstrates that it is more cost effective to require a further emission
reduction from the rim seal area than from deck seams. To examine this,
Regulatory Alternative IV was formulated by requiring that an internal
floating roof be equipped with a liquid-mounted primary seal and a
secondary seal and with controlled fittings. This group of control
technologies reduces the fixed roof tank emissions by about 97 percent.
Regulatory Alternative V requires that deck seam emissions be
reduced through the use of welded decks in addition to the equipment
required by Alternative IV. This array of equipment reduces fixed roof
tank emissions by about 97 percent.
At this point in the development of regulatory alternatives all of
the emissions sources from internal floating roof tanks have been reduced
to the greatest possible extent. Therefore, other control options that
do not involve internal floating roofs were examined.
Tanks could be equipped with vapor control recovery systems. Such
a system would be expected to provide about 95 percent emission reduction.
This system is not as efficient as the control equipment required by
Regulatory Alternatives IV and V and is much more costly. Therefore,
vapor control or recovery systems were rejected as a regulatory alternative.
6-3
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External floating roof tanks with liquid-mounted or mechanical
shoes primary seals and a secondary seal were examined as a possible
regulatory alternative. External floating roof tanks are only available
in size ranges that are generally larger than the size range of most VOL
tanks; 59 percent of VOL storage vessels are projected to have diameters
less than 6 meters. For these reasons external floating roof tanks were
not selected for evaluation as a regulatory alternative.
In summary, the regulatory alternatives would require that each
vessel storing a VOL be equipped with the control technology described
as follows:
• Regulatory Alternative 0 - no additional control over baseline.
t Regulatory Alternative I - an internal floating roof with a
vapor-mounted primary seal (IFR ).
0 Regulatory Alternative II - an internal floating roof with a
liqud-mounted primary seal (IFR, ).
• Regulatory Alternative III - an internal floating roof with a
liquid-mounted primary seal and controlled deck fittings
• Regulatory Alternative IV - an internal floating roof with a
liquid-mounted primary seal controlled deck fittings, and a
continuous secondary seal (IFR, ~ ).
• Regulatory Alternative V - a welded internal floating roof
with a liquid-mounted primary seal, controled deck fittings
and a continuous secondary seal ( IFR, , ).
w ImjCf.ss
6.2 MODEL PLANTS
Model plants are developed for use in evaluating the worst-case
economic impacts that the regulatory alternatives may have on affected
industries. For VOL storage, as is discussed in Chapter 7, nationwide
impacts are projected from an extrapolation of the 1977 tank volume and
vapor pressure distribution as presented in Section 3.1. The model
plants described in this chapter are used to evaluate potential adverse
economic impacts on individual plants. (The economic impact analyses
6-4
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are presented in Chapter 9.) Because there is a greater potential
adverse economic impact upon small facilities, small plants or facilities
are selected as worse-case examples. The model plants consist of a
model terminal and a model producer/consumer. These model plants are
based on actual facilities that have parameters suitable for use in the
economic impact analysis.
6.2.1 Model Terminal
The model terminal data are presented in Table 6-1. These data are
formatted to facilitate comparison with the nationwide VOL storage
terminal statistics presented in Chapter 3 (see Table 3-3). The model
has roughly as many vessels as the average terminal. However, for the
most part, the vessels in the model terminal are smaller in size than
the vessels in the average terminal. In general, small vessels are more
expensive per unit volume of storage capacity to control than larger
vessels. Also, the volume of material that passes through the model
terminal is small. Because of this, the additional costs that result
from the implementation of regulatory alternatives are higher on a
per-volume-throughput basis. Finally, as a general rule, any small
business faces higher costs of capital than a large corporation. It is
assumed that the model terminal operates as an independent facility and
would, therefore, face these higher costs of capital.
6.2.2 Model Producer/Consumer
The model producer/consumer represents a small chemical manufacturing
facility. It is assumed that a small facility is likely to be more
severely affected by the regulatory alternatives under consideration.
The model producer/consumer facility consists of small vessels and
produces small amounts of an inexpensive product. The lower product
price minimizes potential recovery credits associated with the installation
of controls.
The model producer/consumer data are presented in Table 6-2. The
model facility produces fewer than 4.54 x 106 kilograms per year (107 pounds
per year) of a product that sells for $0.35 per kilogram ($0.16 per
pound). Both the production capacity and product price for the model
producer/consumer are smaller than the average capacity and price for
organic chemicals estimated from the Organic Chemical Producters Data
Base (see Chapter 9).
6-5
-------
Table 6-1. MODEL TERMINAL
Terminal capacity - 14,000 m3 (=3.6 x 106 gal)
Number of tanks - 48
Volume of smallest tank - 3.8 m3 (si,000 gal)
Average tank volume - 300 m3 (s80 x 103 gal)
Volume of largest tank - 2,300 m3 (=600 x 103 gal)
Average number of annual
turnovers per tank - 2.9
Terminal throughput - 39,000 m3 (=10,000 x 103 gal)
Table 6-2. MODEL PRODUCER/CONSUMER
Plant production capacity - <4.5 x 106 kg/year
(<107 Ib/yr)
Plant tank capacity - 2,000 m3 (=530 x 103 gal)
Number of tanks - 11
Average tank volume - 190 m3 (=50 x 103 gal)
Volume of largest tank - 330 m3 (=88 x 103 gal)
Volume of smallest tank - 14 m3 (="4,000 gal)
6-6
-------
7. ENVIRONMENTAL IMPACTS
7.1 INTRODUCTION
This chapter discusses the fifth-year environmental impacts of each
regulatory alternative presented in Chapter 6. The fifth-year impacts
are the impacts that would be incurred by the new, modified, and
reconstructed facilities constructed during the five years following
implementation of the regulatory alternatives. In these analyses, a
base year of 1983 is assumed (i.e., the regulatory alternatives would be
in force starting in 1983). The nationwide impacts that are evaluated
include:
• air pollution impacts;
• water pollution impacts;
• energy impacts; and
• other environmental concerns.
The nationwide impacts are developed from the number of affected
facilities (i.e., VOL storage vessels) projected to be constructed
during the five years following the baseline date. Chapter 9 explains
the derivation of a bivariate distribution, by tank size and vapor
pressure of the VOL stored, of the numbers of affected facilities that
are projected to be constructed between 1983 and 1988. The potential
environmental impacts of the regulatory alternatives are estimated with
this bivariate distribution of affected facilities and the knowledge of
the baseline control levels (discussed in Section 3.3) that would result
in the absence of performance standards.
7.2 AIR POLLUTION IMPACTS
Adoption of any of the regulatory alternatives will reduce VOC
emissions in the years following the implementation. The magnitude
-------
of the emissions reductions to be achieved by the regulatory alternatives
is estimated based on the estimated five-year total number of affected
new and replacement tanks to be constructed, the tank size vapor pressure
percentage distribution discussed in Chapter 9, and the equations for
predicting emissions from the various VOL storage vessel equipment types
(presented in Section 3.2). An average emission rate for tanks in each
tank size/vapor pressure interval in the distribution is calculated by
using the average capacity of the interval, the average vapor pressure
of the interval, and the average number of tank turnovers for the tank
size range. The emissions per tank in the interval are then multiplied
by the number of tanks in the tank size/vapor pressure interval. The
total emissions rate for a given regulatory alternative is determined by
summing across the tank size/vapor pressure intervals. This procedure
is repeated for the baseline control level and each regulatory alternative.
Emissions reductions are determined by subtracting the baseline emissions
rate from the emissions rate for each regulatory alternative.
Table 7-1 and 7-2 list the emission rates and emission reductions,
respectively, associated with each regulatory alternative. The emission
values in the tables are in megagrams per year, reflecting the annual
emissions or emission reduction from the affected facilities that are
projected to be constructed during the five years following the baseline
date (1983-1988). Each table provides estimates for ten alternate tank
size/vapor pressure cutoff levels. For example, row two of Table 7-1
provides emission estimates assuming that the minimum tank size affected
by the regulation is 75 m3 (20,000 gallons) and the minimum vapor pressure
affected by the regulation is 3.5 kPa (0.5 psia). A projected 3,749 tanks
will be constructed in the five years following 1983 that are above
these cutoff conditions and, therefore, would be affected by an NSPS
that implemented cutoffs at these levels. The tanks regulated at this
cutoff will emit 10,845 Mg/yr under the baseline control level, 2,502 Mg/yr
under Regulatory Alternative I and so forth for the remaining regulatory
alternatives. Referring to Table 7-2 for this same cutoff, Regulatory
Alternative I will effect a 8,343 Mg/yr reduction in VOC emissions;
Regulatory Alternative II will effect a 8,780 Mg/yr reduction in VOC
emissions, and so forth for the remaining regulatory alternatives.
7-2
-------
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-------
7.3 WATER QUALITY AND SOLID WASTE IMPACTS
The control technologies selected as regulatory alternatives do not
generate wastewater or solid waste during their operation as control
devices. During tank turnarounds and periods when tanks are not in
service, however, wastewater and solid waste may be generated. Inspection
and maintenance operations can generate both wastewater and liquid/solid
wastes that require treatment or special disposal techniques. Most
major inspections and/or repairs require that the vessel be cleaned and
degassed. The concern is that the environment inside the tank be free
of potential explosive and toxic hazards prior to introducing personnel
for inspections or repairs.
Cleaning and degassing generally involves the following steps :
I. Removing residual product with a vacuum truck;
2. Lessening rust scale, if present, with high pressure water and
removing debris;
3. Washing the tank with high pressure water and detergents; and
4. Rinsing the tank with water.
The residual product constitutes a waste that, depending on the
nature of the VOL stored in the tank, may have to be disposed of with
conventional solid waste disposal techniques or as a hazardous waste in
compliance with the requirements of the Resource Conservation and Recovery
Act (RCRA). The washwater, again depending on the nature of the VOL
stored, constitutes wastewater for treatment in conventional wastewater
treatment systems, or sometimes hazardous waste for disposal in compliance
with RCRA. Another degassing methodology involves the application of a
sustained forced draft to the interior of the vessel for a sufficient
period to evaporate all residual product. This technique generally
involves no wastewater or hazardous solid waste disposal. However, air
emissions do result.
For the most part, tank degassing and the resultant waste impacts
occur irrespective of the regulatory alternatives. On the average,
tanks are cleaned, degassed and inspected on about a 10-year cycle.
7-5
-------
7.4 ENERGY IMPACT
The control technologies selected for the regulatory alternatives
do not increase the power or other energy requirements of the VOL storage
vessels. Therefore, no energy impacts are attributable to the regulatory
alternatives.
7.5 OTHER ENVIRONMENTAL CONCERNS
7.5.1 Irreversible and Irretrievable Commitment of Resources
The regulatory alternatives would not preclude the development of
future control options nor would they curtail any beneficial use of the
environment. No long-term environmental losses would result from the
regulatory alternatives.
7.5.2 Environmental Impact of Delayed Standards
The only environmental impact associated with a delay in proposing
and promulgating the standard would be an increase in VOC emissions from
storage tanks attributable to the construction of new tanks.
7-6
-------
7.6 REFERENCES
1. Memorandum from J. L. Shumaker to W. Moody of TRW Environmental
Division regarding Retrofit IRF and Degassing Costs, December 21,
1982.
7-7
-------
8. COST ANALYSIS
This chapter summarizes the cost analysis data. Installed capital
costs are presented in Section 8.1 for the types of equipment specified
in the regulatory alternatives outlined in Chapter 6. For each type of
equipment, cost estimates are presented for the range of tank sizes
commonly employed in the storage of volatile organic liquids (VOL).
Cost data also are presented for several control alternatives (external
floating roof tanks and vapor control equipment) that are considered in
Chapter 6 but that are not selected as regulatory alternatives. In
addition to the cost estimates for individual tank size/control alternative
combinations, the aggregate cost impacts from applying the regulatory
alternatives to the model plants are estimated. Sections 8.1 through 8.4
present estimates of the capital costs, annualized costs, and cost
effectiveness for model terminal and model producer/consumer facilities.
Model plants are discussed in detail in Chapter 6.
All costs are calculated as average costs over the cost of the
baseline control level presented in Section 3.3. For the purposes of
the cost analysis presented in this chapter, all tanks with a capacity
greater than or equal to 75 cubic meters (20,000 gallons) and storing a
liquid with a true vapor pressure g-reater than or equal to 3.5 kilopascals
(0.5 psia) are assumed to be affected by the regulatory alternatives.
Because the model terminal and model producer/consumer facilities will
not be used to evaluate the effectiveness of the regulatory alternatives
in controlling emissions, no emission information is presented in this
chapter.
The cost analysis follows a prescribed approach. Capital costs,
which represent the initial investment for control equipment and
installation, are estimated based on vendor quotes and EPA documents.
From these estimates, correlations and factors have been developed to
approximate capital costs for the range of tank sizes commonly used in
the industry. The capital cost is annualized by applying a capital
recovery charge, which is based on an estimated equipment lifetime and
the interest rate on the capital, and by adding costs for taxes and
-------
insurance. The total annualized cost, excluding product recovery credits,
attributable to each regulatory alternative is estimated by adding
operating costs to the annualized capital cost. The total annualized
cost, including product recovery credits, is estimated by subtracting
the value of the recovered product from the annualized costs. Cost
effectiveness is the total annualized cost divided by the emission
reductions obtained by applying each regulatory alternative.
8.1 CAPITAL COSTS
The capital costs for the regulatory alternatives are based on cost
123
estimates obtained from industry vendors and EPA reports. ' ' Vendors
were contacted and asked to provide estimates of the costs to construct
fixed roof tanks, external floating roof tanks, and secondary seals, as
well as the cost to install internal floating roofs in fixed roof tanks.
(See Tables 8-1, 8-2, 8-3, and 8-4.) Internal floating roof cost data
are based on a fourth-quarter 1982 survey of equipment manufacturer's
prices. Other cost estimates are based on data collected in a similar
manner in late 1979 and early 1980. These estimates have been scaled
4
based on Chemical Engineering general cost indexes to reflect second-
quarter 1982 dollar estimates. All capital costs are at least equivalent
to study estimates (+30 percent accuracy).
The capital cost of an internal floating roof depends mainly upon
the liquid surface area. Therefore, the capital costs for these devices
are given only as a function of the tank diameter, which is directly
related to surface area. The cost of a fixed roof tank, however, is a
function of the volume capacity of the tank*. Tank and roof costs
An estimating technique has been developed to relate tank volume to tank
height and diameter and thereby aid the comparison of fixed roof tank costs
to floating roof costs. The formula is based on the fact that tank heights
generally increase in about 2.62 meter (8 foot) increments (due to the
width of sheet steel) and that for other than small tanks, the height to
diameter ratio rarely exceeds unity in industry practice. The formula,
which has been used in the development of the capital cost tables,
is as follows:
Tank capacity (V) Tank height (H) Tank diameter (D)
in cubic meters in meters in meters
0-45 2.62 ,
46-91 5.25
92-307 7.87
308-1,136 10.5
1,137-11,590 13.1
>11,590 15.7
8-2
-------
Table 8-1. ESTIMATED INSTALLED,CAPITAL COST
OF A FIXED ROOF TANKD'b
(second-quarter 1982 dollars)
Tank
volume,
(m3)
75
150
250
500
1,000
5,000
10,000
Tank
diameter,
(m)
4.3
4.9
6.4
7.8
11.0
22.0
31.2
Tank
cost3'
($)
13,300
19,900
26,700
39,800
59,400
150,400
224,300
Estimated from the equation: Cost ($1000) = 0.883 V0'577;
where, V = tank volume in cubic meters; with correlation
coefficient r2 >0.99. This equation yields first-quarter
1980 cost estimates that were scaled by a factor of 1.25 to
reflect second-quarter 1982 prices.
Excluding the cost of the foundation, land, etc. that are
not affected by the regulatory alternatives.
8-3
-------
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8-4
-------
Table 8-3. ESTIMATED INSTALLED COST OF A WELDED CONTACT INTERNAL
FLOATING ROOF WITH SECONDARY SEALS
(fourth-quarter 1982 dollars)
Tank Roof
diameter cost3
(m) ($)
5 15,900
10 30,000
15 44,000
20 58,100
25 72,100
30 86,100
aThe basic cost of the roof and primary seal is estimated from the
equation: cost ($1000) = 1.91 + 2.54D; where D equals the tank diameter
in meters with the correlation coefficient r2 = 0.883. The additional
cost of a secondary seal is estimated based on the factor, $85 per linear
meter of circumference. The secondary seal cost is the average price of
13 seals from 8 different vendors.
8-5
-------
Table 8-4. ESTIMATED INSTALLED CAPITAL COST , fi 7
OF EXTERNAL FLOATING ROOF TANKS WITH SECONDARY SEALS3'b>/
(second-quarter 1982 dollars)
Tank
volume,
(m3)
75
150
250
500
1,000
5,000
10,000
Tank
diameter,
(m)
4.3
4.9
6.4
7.8
11.0
22.0
31.2
Tank .
costa'b
($)
22,100
32,300
42,300
61,900
89,900
218,000
319,000
a 0 552
Cost of tank estimated from the equation: Cost ($1000) = 1.54 V ;
where, V = tank volume in cubic meters; with the correlation coefficient
r2 = 0.98. This equation yields first-quarter 1980 cost estimates tbat
were scaled by a 1.25 factor to reflect second-quarter 1982 dollars.
The additional cost of the secondary seal is estimated to be $85 per
linear meter of roof circumference.
8-6
-------
are not related to the vapor pressure of the material stored in the
range of products potentially affected by a VOL storage regulation (i.e.
<^11 psia). For each type of equipment (i.e., internal floating roof,
fixed roof tank, etc.) an equation of predicted capital costs was derived
from the available data (vendor quotes). These equations are used in
all subsequent cost analyses.
Table 8-1 presents costs for fixed roof tanks. These are installed
capital costs including the cost of materials, transportation, labor,
testing, and other vendor-incurred costs associated with erection of the
tank. The estimates assume that a suitable location and foundation are
available. Examples of the costs that are excluded include the cost of
land, providing utilities to the site, and a concrete foundation. Such
costs are fixed and constant irrespective of possible regulations for
VOL storage vessels. Since they do not affect the regulatory decisions,
they are not considered in the cost analysis.
Table 8-2 presents installed cost estimates for internal floating
roofs with successively more stringent (i.e. lower emitting ) alternative
equipment. As discussed in Chapter 4, noncontact roofs are constructed
of primarily aluminum materials. The basic roof costed in the table is
equipped with a single, vapor-mounted, wiper type, deck perimeter seal
(primary seal). The next costed alternative is a liquid-mounted, resilient
tube, primary seal in place of the vapor-mounted wiper type seal. The
third alternative includes the liquid-mounted primary seal, but adds
"controls" to certain deck fittings. Deck fittings and the "controls"
for deck fittings are described in Chapter 3 and Chapter 4, respectively.
Briefly, "controls" for deck fittings are gaskets for covers, sleeve
seals for support columns and the use of a sample well with a split
fabric seal in place of a slotted sample pipe. The installation and use
of "controlled" fittings has a negligible effect on the cost of the
floating roof. The small additional cost of gaskets and seals (^$200)
is offset by the savings from installing a sample well instead of a
slotted sample pipe ($100 to $300).8 Also, "controlled" fittings are
not expected to significantly increase operating costs of internal
floating roofs. The final alternative costed in Table 8-2 combines all
8-7
-------
the preceding alternatives. It includes a liquid-mounted primary seal,
"controlled" deck fittings and a wiper type secondary deck perimeter
seal (secondary seal).
Table 8-3 presents the estimated installed cost of welded contact
internal floating roofs (steel pan) with secondary seals. The primary
seal included in these cost estimates is a metallic shoe seal, a liquid-
mounted resilient tube seal, or a wiper type seal. Vendor quotes for
steel pan roofs with each of these seal types were correlated to produce
an "average" or "typical" roof cost function (see Table 8-3). The roof
is constructed of steel. Larger roof sizes include auxiliary pontoon
flotation.
Table 8-4 presents estimates of the installed capital cost of
external floating roof tanks. It is important to realize that these
costs include the tank shell in addition to the roof. The cost of
control over the fixed roof tank baseline costs is the difference between
the external floating roof costs (Table 8-4) and the fixed roof tank
cost (Table 8-1) for equivalent tank sizes. The tanks costed in Table 8-4
include primary and secondary seal costs. The primary seals are either
liquid-mounted or vapor-mounted resilient tube seals. For external
floating roof tanks, the location of the primary seal (i.e. vapor- or
liquid-mounted) does not significantly affect the roof cost.
The incremental cost of the control alternatives can be approximated
from the estimates contained in Tables 8-1 through 8-4. The comparison
of control alternative costs, however, must be made for tanks of equivalent
diameter or volume. Care must also be taken to ensure that comparisons
are made between equivalent types of equipment, i.e., roof cost versus
roof cost or tank cost versus tank cost.
Tables 8-5 through 8-13 present the costs of applying Regulatory
Alternatives I-V, the external floating roof control options, and the
vapor control alternatives to the model terminal and the model
producer/consumer facilities. The model plants are discussed in Chapter 6
and described in Appendix D. Although the model plants contain a number
of tanks (terminal, 48 tanks; producer/consumer, 11 tanks), the regulatory
alternatives affect only a fraction of the respective tank populations.
The majority of tanks are exempted on the basis of size and vapor
8-8
-------
Table 8-5. COST OF REGULATORY ALTERNATIVE I*
(fourth-quarter 1982 dollars)
Cost parameters
Capital cost
Annuali zed capital charges
Model
terminal
56,000
6,580
Model
producer/
consumer
15,800
1,860
Annual taxes, insurance and
administration
Operating costs
Maintenance
Inspection
Total annualized cost without
product recovery credits
Total annualized cost with
product recovery credits
@ $460/Mg
Cost effectiveness in dollars per
megagram VOC emssions reduction
2,240
2,800
560
12,180
7,530
744
630
790
160
3,440
2,090
714
*Noncontact internal floating roof with a vapor-mounted primary seal.
8-9
-------
Table 8-6. COST OF REGULATORY ALTERNATIVE II*
(fourth-quarter 1982 dollars)
Cost parameters
Capital cost
Annual i zed capital charges
Model
terminal
56,600
6,670
Model
producer/
consumer
16,000
1,890
Annual taxes, insurance and
administration
Operating costs
Maintenance
Inspection
Total annualized cost without
product recovery credits
Total annualized cost with
product recovery credits
@ $460/Mg
Cost effectiveness in dollars per
megagram of VOC emissions reduction
2,260
2,830
570
12,330
7,480
710
640
800
160
3,490
1,610
395
*Noncontact internal floating roof with a liquid-mounted primary seal
8-10
-------
Table 8-7. COST OF REGULATORY ALTERNATIVE III*
(fourth-quarter 1982 dollars)
Cost parameters
Capital cost
Annual i zed capital charges
Model
terminal
56,600
6,670
Model
producer/
consumer
16,000
1,890
Annual taxes, insurance and
administration 2,260
Operating costs
Maintenance 2,830
Inspection 570
Total annualized cost without
product recovery credits 12,330
Total annualized cost with
product recovery credits
@ $460/Mg 7,190
Cost effectiveness in dollars per
megagram of VOC emissions reduction 644
640
800
160
3,490
533
87
*Noncontact internal floating roof with liquid-mounted primary seal and
gasketed deck fittings.
8-11
-------
Table 8-8. COST OF REGULATORY ALTERNATIVE IV*
(fourth-quarter 1982 dollars)
Cost parameters
Capital cost
Annuali zed capital charges
Model
terminal
71,830
9,130
Model
producer/
consumer
23,210
3,050
Annual taxes, insurance and
administration 2,870
Operating costs
Maintenance 3,590
Inspection 720
Total annualized cost without
product recovery credits 16,310
Total annualized cost with
product recovery credits
@ $460/Mg 11,010
Cost effectiveness in dollars per
megagram of VOC emissions reduction 957
930
1,160
230
5,370
2,230
326
*Noncontact internal floating roof with liquid-mounted primary seal,
secondary seal and gasketed deck fittings.
8-12
-------
Table 8-9. COST OF REGULATORY ALTERNATIVE V*
(fourth-quarter 1982 dollars)
Cost parameters
Capital cost
Annual ized capital charges
Model
terminal
184,800
22,400
Model
producer/
consumer
90,800
11,000
Annual taxes, insurance and
administration
Operating costs
Maintenance
Inspection
Total annualized cost without
product recovery credits
Total annualized cost with
product recovery credits
@ $460/Mg
Cost effectiveness in dollars per
megagram of VOC emissions reductin
7,390
9,240
1,850
40,880
35,500
3,040
3,630
4,540
910
20,080
16,770
2,330
*Welded contact internal floating roof with liquid-mounted primary seal,
secondary seal and gasketed deck fittings.
8-13
-------
Table 8-10. COST OF EXTERNAL FLOATING ROOF TANKS WITH
PRIMARY SEAL AND SECONDARY SEAL
(second-quarter 1982 dollars)
Cost parameters
Capital cost
Annual ized capital charges
Model
terminal
150,920a
18,420
Model
producer/
consumer
47,210a
5,900
Annual taxes, insurance and
administration
Operating costs
Maintenance
Inspection
Total annualized cost without
product recovery credits
Total annualized cost with
product recovery credits
6,040
7,550
1,500
33,510
1,890
2,360
470
10,620
@ $460/Mg
Cost effectiveness in dollars per
megagram of VOC emissions reduction
b
b
b
b
Costs above the baseline control cost.
External floating roofs do not reduce emissions beyond the baseline level.
Therefore, no emissions reduction credits exist. Emissions rates for both
the model terminal and the model producer/consumer are expected to increase.
Consequently, cost effectiveness for the alternative is undefined.
8-14
-------
Table 8-11. COST OF EXTERNAL FLOATING ROOF TANKS WITH
LIQUID-MOUNTED PRIMARY SEAL AND SECONDARY SEAL
(second-quarter 1982 dollars)
Cost parameters
Capital cost
Annual ized capital charges
Model
terminal
150,920*
18,420
Model
producer/
consumer
47,210*
5,900
Annual taxes, insurance and
administration
Operating costs
Maintenance
Inspection
Total annualized cost without
product recovery credits
Total annualized cost with
product recovery credits
6,040
7,550
1,500
33,510
1,890
2,360
470
10,620
@ $460/Mg
Cost effectiveness in dollars per
ton of VOC emissions reduction
29,350
3,250
10,400
21,990
*Costs above the baseline control cost.
8-15
-------
Table 8-12. COST OF VAPOR CONTROL BY INCINERATION TECHNIQUES
(second-quarter 1982 dollars)
Cost parameters
Model
terminal
Model
producer/
consumer
Capital cost
Annualized capital charges
Annual taxes, insurance and
administration
Operating costs
Maintenance
Labor
Energy
Total annualized cost without
product recovery credits
Total annualized cost with
product recovery credits
@ $460/Mg
Cost effectiveness in dollars per
megagram of VOC emissions reduction
631,000
114,000
4,100
31,600
27,200
4,900
181,800
a,b
631,000
114,000
4,100
31,600
27,200
4,900
181,800
a,b
15,500
20,700
Cost estimates assume one incineration unit and saturator per facility
(see Chapter 4).
3Based on a first-quarter 1980 estimate scaled by a 1.25 factor to reflect
second-quarter 1982 prices.
"Because there are no recovery credits, the cost is equal to the total
annualized cost without product recovery credits.
8-16
-------
Table 8-13. COST OF VAPOR RECOVERY BY CARBON ADSORPTION TECHNIQUES
(second-quarter 1982 dollars)
Cost parameters
Capital cost
Annual ized capital charges
Annual taxes, insurance and
Administration
Model
terminal
631,000a'b
114,000
4,100
Model
producer/
consumer
631,000a'b
114,000
4,100
Operating costs
Maintenance 31,600
Labor 45,000
Energy 60,000
Total annualized cost without
product recovery credits 255,000
Total annual ized cost with
product recovery credits
@ $460/Mg 249,600
Cost effectiveness in dollars per
megagrams of VOC emissions reduction 21,280
31,600
45,000
60,000
255,000
250,970
28,650
aAssumes one unit per facility sized for 0.142 standard3m /s of saturated
vapor diluted to 25% LEL for a total of 8.0 standard m /s.
Based on a first-quarter 1980 estimate scaled by a factor of 1.25 to
reflect second-quarter 1982 prices.
8-17
-------
pressure. Four tanks (2 fixed roof and 2 floating roof tanks) are
affected by the regulatory alternatives in the model producer/consumer
plants. The model terminal has five affected tanks (4 fixed roof and
1 floating roof tank). These tanks can be identified by inspection of
Appendix D with an understanding of the baseline control level described
in Section 3.3. The base capital cost of all storage vessels at the
model terminal is 1.07 million dollars, and the base capital cost of
storage vessels at the model producer/consumer plant is 0.25 million
dollars. As mentioned previously, these costs do not include foundation
costs, land costs or other costs that are not affected by the regulatory
alternatives.
The cost of a vapor control system is a function of the vapor flow
rate to the system. This flow rate is controlled by the rate at which
liquids are pumped into the tank and not by tank diameter or volume. No
cost tables are presented for vapor recovery. The capital costs of
installing a carbon adsorption or thermal oxidation vapor control system
to reduce volatile organic compound (VOC) emissions from the model
1 2
plants are estimated from information supplied by EPA reports. ' (See
Tables 8-12 and 8-13.) It is assumed that each system is sized for a
stream of saturated vapor at 0.142 standard cubic meters per second
(0.142 standard m3/s). Because of the large size of the vapor control
systems, it is assumed that only one system is needed for each model
facility. However, because of product compatibility or operating problems,
actual facilities might need more than one unit; therefore, the cost
estimates are almost certainly low.
8.2 ANNUALIZED CAPITAL COSTS
The capital cost for each regulatory alternative is annualized
assuming the useful equipment lifetimes listed in Table 8-14. In estimating
the annualized capital cost for the equipment, it is assumed the capital
is borrowed at a 10 percent real interest rate. Based on the estimated
equipment lifetimes and the assumed interest rate, annualized capital
costs are estimated with the capital recovery factor method.
8-18
-------
Table 8-14. LIFETIMES OF CONTROL EQUIPMENT
Device
Tank and floating roof
Secondary seals
Carbon adsorber
Thermal oxidizer
Lifetime (yrs)
20
10
10
10
Capital
Recovery
Factor9
0.11746
0.16275
0.16275
0.16275
aCapital recovery factor determined by the equation:
CRF = 1(1 + i)n/(l + i)n - 1;
where i = the annual interest rate and
n = the equipment lifetime.
Table 8-15. COST ANNUALIZING ASSUMPTIONS
Item
Charge
Tax, insurance, and administration
Maintenance
Inspection
Interest rate
Labor
Natural gas
Electricity
Energy other than natural gas or electricity
4% of capital cost
5% of capital cost
1% of capital cost
10%
$16/hr
$3.00/109 J
$0.04/kWh
$2.50/109 J
8-19
-------
8.3 ANNUALIZED COSTS
The annualized cost without product recovery credits is calculated
by adding the annualized capital charges to the costs for taxes, insurance
and administration (4 percent of the capital costs) and the operating
costs. Operating costs include the yearly maintenance charge of 5 percent
of the capital cost, and an inspection charge of 1 percent of the capital
cost. (See summary in Table 8-15.) The factors used to estimate the
cost of taxes and administration (4 percent) and maintenance costs
Q
(5 percent) are based on operating experience of the Hydroscience Company.
In respect to vapor control systems, utility expenses are estimated
using electricity costs of $0.04 per kilowatt-hour, natural gas costs of
9 9
$3.00 per 10 joules, and other energy costs of $2.50 per 10 joules.
Emission monitoring costs were included in the annualized estimates for
a flame ionization hydrocarbon detector at $4,500, for a flow measurement
device at $2,500, and for bottled gas to operate the flame ionization
detector at $2,625 per year. These monitoring costs were annualized for
a charge of $3,750 per year. Additionally, it is assumed that 500 hours
of operating labor at $16 per hour will be required to operate and
maintain the emission monitoring system.
The total annualized cost with product recovery credits is calculated
by accounting for the value of any recovered product. The recovered
product was costed based on a weighted average product value of roughly
100 synthetic organic chemicals. A price of $460/megagram represents
the weighted average product value (1978 average scaled to 1982 dollars
with a factor of 1.55 based on the Chemical Engineering Journal Industrial
Chemical Producer's Price Index). The amount of recovered product was
assumed equal to the emissions difference between the baseline emissions
and each regulatory alternative, except for thermal oxidation. Because
the thermal oxidation unit destroys VOC vapors, no recovery credits were
assumed.
8.4 COST EFFECTIVENESS
The cost effectiveness of a regulatory alternative is defined as
the cost per metric ton of VOC removed. The average product price of
8-20
-------
$460/megagram was used in these calculations to quantify credits for
recovered product that would be lost under the baseline conditions. The
cost effectiveness values presented in Table 8-5 through 8-13 are in
units of dollars per megagram of VOC determined by dividing the total
annualized cost by the emission reduction achieved by a regulatory
alternative or control technique.
8.5 COST OF OTHER FEDERAL REGULATIONS
There are a wide variety of Federal statutes that affect the
manufacture and storage of volatile organic liquids. Table 8-16 lists
12 Federal statutes that control human and environmental exposure to
toxic chemicals. The same statutes will also apply to volatile organic
liquids (VOLs). Regulatory action required by these statutes controls
the chemicals in products and wastes, ambient and occupational environments,
chemical identification, chemical sources, and the handling, discharge,
and ultimate disposal of chemicals. These regulations will cause an
outlay of capital by the chemical manufacturing industry. Total spending
for pollution control by the chemical industry in 1979 was expected to
be $639 million. Costs to specific segments of the industry, however,
are difficult to distinguish on the basis of published data. The costs
of the proposed regulations are difficult to estimate because of the
lack of available information regarding the content of the final
regulations. This section summarizes the available data on costs imposed
upon the chemical manufacturing and storage industries by Federal
regulations and discusses the impact of these costs on their operations.
Regulatory statutes that apply to manufacturers and users of VOLs
are listed in Table 8-17. This list includes the statutes from Table 8-16,
in addition to several others, and briefly describes the provisions,
12
requirements, and regulatory concerns of each statute. The last
column lists and describes the approximate costs of the statutes. In
some cases, this column is blank because relevant cost data could not be
found. Most of the costs available are for the general chemical industry
and are not subdivided into costs for handlers of VOLs. However,
Table 8-17 does show that these costs are considerable. Other indirect
costs, such as the "abandonment" of new chemicals, and decreases in
8-21
-------
Table 8-16. FEDERAL LAWS REGULATING TOXIC CHEMICALS
Title Abbreviation Public Law No
Toxic Substance Control Act of 1976
Food, Drug, and Cosmetic Act, as amended
in 1976
Occupational Safety and Health Act of 1980
Consumer Product Safety Act of 1970
Marine Protection, Research and Sanctuaries
Act of 1972
Federal Pesticide Act of 1978
Clean Air Act, as amended in 1977
Federal Water Pollution Control Act,
amended as Clean Water Act of 1977
Safe Drinking Water Act of 1974
Resource Conservation and Recovery Act of 1976
Hazardous Materials Transportation Act of 1970
National Environmental Policy Act of 1969
TSCA
FDCA
OSHA
CPSA
Ocean Dumping
FPA
CAA
FWPCA
CWA
SDWA
RCRA
HMTA
NEPA
94-469
94-295
91-596
92-573
92-532
95-396
95-95
92-500
95-217
93-523
94-580
91-458
91-190
8-22
-------
Table 8-17. STATUTES THAT MAY BE APPLICABLE TO THE MANUFACTURE
AND STORAGE OF VOLATILE ORGANIC LIQUIDS
Statute
Applicable provision, regulation, or
requirement of statute
Approximate costs incurred
Toxic Substances Control Act
Food, Drug, and Cosmetic Act
Occupational, Safety, and
Health Act
• Premanufacture notification
i Labelling, recordkeeping
• Reporting requirements
• Toxicity testing
Consumer Product Safety Act
Marine Protection, Research and
Sanctuaries Act
Federal Pesticide Act
Clean Air Act and Amendments
• Consumer use of chemicals
• Walking-working surface standards
• Means of egress standards
• Occupational health and
environmental control standards
• Hazardous material standards
• Personal protective equipment
standards
• General environmental control
standards
• Medical and first aid standards
• Fire protection standards
• Compressed gas and compressed air
equipment
• Welding, brazing, and cutting
standards
• Consumer use of chemicals
• Ocean dumping permits
• Recordkeeping and reporting
• Consumer use of chemicals
• State Implementation Plans
• National Emission Standards For
Hazardous Air Pollutants
• New source performance standards:
Air oxidation
Volatile organic liquid storage
• PSD construction permits
• Nonattainment construction permits
• General reporting rule (Section 8(a))
is expected to initially cost
chemical manufacturers about
$6 million. EPA estimates the cost
will be $420 for each chemical a
manufacturer produces.
• Costs for entire chemical industry
projected to be $100-200 million per
year. Preinventory notification ,7
cost: $1,200-1,500 per chemical.
• $220/year per worker.
18
• About $256 million lost due to
cancellatioOqOr suspension of
pesticides.iy
• About $249 million spent by entire
chemical,industry for air pollution
control.
(continued)
8-23
-------
Table 8-17. Concluded
Statute
Applicable provision, regulation or
requirement of statute
Approximate costs incurred
Clean Water Act
Safe Drinking Water Act
Resource Conservation and
Recovery Act
Hazardous Materials
Transportation Act
National Environmental Policy
Act
Coastal Zone Management Act
Power Plant and Industrial
Fuel Use Act
Discharge permits
Effluent limitations guidelines
New source performance standards
Control of oil spills and
discharges
Pretreatment requirements
Monitoring and reporting
Permitting of industrial projects
that impinge on wetlands or
public waters
• Environmental impact statements
• Requires underground injection
control permits
• Permits for treatment, storage,
and disposal of hazardous
liquids.
• Establishes system to track
hazardous wastes
• Establishes recordkeeping,
labelling, and monitoring
system for hazardous wastes
• Superfund
• Requires environmental impact
statements
• Allows states to veto Federal
permits for plants to be sited
in coastal zones
• Prohibits new, major, industrial
power plants, which utilize fuel
oil or natural gas
• Increased annual costs to pesticide
manufacturers, caused by regula-
tions, under Sections 301 and 304,
would range between 0.2 and 2
percent of the revenues from pesti-
cide chemicals. Profitability
would be reduced for some
manufacturers.
• Total annual cost of $243 million
incurred by organic chemical,
pesticide, and explosives industries
to comply with EPA hazardous waste
regulations.
• Another source estimates
$414 million total expenditure by
entire chemical industry for water
pollution control.
• Only one out of the more than 500
surface dumps and landfills would
meet RCRA standards. Over
$1 bill ion,Deeded to upgrade the
others."'"
• Proposed that $400 million of
$6 billion superfund come from
annual industry fees on oil,
chemical, and heavy metal
industries. Part of fund would
come from fee, not to exceed $5
per ton on chemicals. Fund applies
only to past disposal practices.
• Waste disposal costs are expected
to rise from $1.50-$5.00 per ton.
to over $50 per ton under RCRA.
8-24
-------
innovation, productivity, job opportunities, and "incentive for
entrepreneurial initiative," are not easily quantified and are
13 14
excluded. ' In addition, health and economic benefits of the regulations
are not considered.
The economic impact of these regulations on the chemical industry
is not fully quantified. The Council on Environmental Quality reported
in 1979 that the economic health of this industry is better than most
and that few plant closings are expected solely because of the costs of
25
compliance with standards and regulations. A 1978 study by EPA's
Office of Solid Waste Management found, with regard to regulations
concerning hazardous wastes, that "certain individual segments of the
industry will be subject to more severe impacts than the industry as a
oc
whole, but no plant closures will result directly from the regulations."
In contrast, a survey sponsored by the Chemical Specialties Manufacturers
Association reported that 14 percent of the firms surveyed said that
present and upcoming EPA regulations could cause them to close. Nine
percent said that EPA rules could cause a change of ownership. The
survey stressed that the greatest difficulty caused by the regulations
would be increased operating costs, followed by reporting and recordkeeping
13
requirements and increased capital costs. Part of this discrepancy in
the perceived impact of Federal regulations may be reduced through the
efforts of the Interagency Regulatory Liaison Group (IRLG). The IRLG
intends to strongly emphasize the coordination of regulations being
developed by member groups and will also emphasize the economic analysis
of the proposed regulations. Agencies participating in the IRLG include
EPA, the Occupational Safety and Health Administration, the Consumer
Product Safety Commission, the Food and Drug Administration, and the
07
Food Safety and Quality Service.
A list of currently proposed regulations that will affect the
28
chemical industry is given in Table 8-18. The economic impact of
these regulations will be unclear until their final forms are determined
from a number of regulatory alternatives. Studies of the economic
effects of many of these regulations are underway at this time.
8-25
-------
Table 8-18. PROPOSED REGULATIONS THAT WILL AFFECT THE CHEMICAL
MANUFACTURING INDUSTRY
(as listed in the Calendar of Federal Regulations)
Agency
Title of regulation
Page No. in calendar
DOL-OSHA Chemical Warning Systems
DOL-OSHA Safety standard for walking and working
surfaces
EPA-OANR National Emission Standards for
Hazardous Air Pollutants - Benzene
EPA-OANR Policy and Procedures for Identifying,
Assessing, and Regulating Airborne
Substances Posing a Risk of Cancer
EPA-OANR Regulations for the prevention of
significant deterioration resulting
from hydrocarbons for carbon monoxide,
nitrogen oxides, ozone, and lead
EPA-OPTS Rules and notice forms for premanu-
facture notification of new chemical
substances
EPA-OPTS Standards and Rules for Testing of
Chemical Substances and Mixtures
EPA-OWWM Hazardous waste regulations: Core
regulations to control hazardous solid
waste from generation to final disposal
68278
68283
68239
68292
68244
68294
68297
68299
8-26
-------
8.6 COSTS AND COST EFFECTIVENESS OF CONTROLS ON AN INDIVIDUAL TANK
This section presents the costs and cost effectiveness of controlling
an individual tank. The tank selected for analysis is the model tank
presented in Chapter 4, Section 1. Emissions from the possible
configurations of the model tank are presented in Table 4-2. The capital
and annualized cost (without product recovery credits) of controls are
presented in Table 8-19. Both the absolute cost effectiveness and the
incremental cost effectiveness will be discussed.
The absolute cost effectiveness is defined as the total annualized
cost of a particular control option minus the value of product recovery
credit (the difference yielding the net annualized cost), divided by the
total emissions reduction achieved by going from no control to that
control option. Incremental cost effectiveness is defined as the difference
in net annualized cost between two control options, divided by the
difference in emission reduction between the same two options.
Table 8-20 presents the absolute cost effectiveness of building the
model tank as a new internal floating roof tank in place of a fixed roof
tank. Table 8-21 presents the incremental cost effectiveness of controlling
seal emissions from an internal floating roof. Table 8-22 presents the
incremental cost effectiveness of controlling deck seam emissions by the
use of welded decks. Consistent with the assumption used previously in
this chapter, the cost of controlling fittings is assumed to be zero;
the cost effectiveness of these controls is, therefore, zero. Based on
the above information, Table 8-23 presents the incremental cost
effectiveness between the regulatory alternatives. Because it is possible
to replace a fixed roof tank with an external floating roof, an analysis
of the internal floating roof equipment requirements of the regulatory
alternatives was made relative to an external floating roof tank with a
mechanical shoe seal and a secondary seal. Table 8-24 presents the
incremental cost effectiveness of building the model tank as an external
floating roof tank with a mechanical shoe primary seal and a secondary
seal instead of the equipment required by each regulatory alternative.
8-27
-------
Table 8-19. CAPITAL AND ANNUALIZED COSTS FOR BASELINE AND CONTROL
EQUIPMENT FOR THE MODEL VOL TANK
Item
Capital Cost
($)
Annualized Cost
($)
1. Fixed roof tank
2. External floating roof tank
with mechanical shoe primary
seal only
3. Bolted deck
4. Welded deck
5. Secondary seal for internal or
external floating roof tank
6. Liquid-mounted primary seal
35,600
52,900
10,700
25,100
2,440
75
7,750
11,500
2,330
5,460
640
17
8-28
-------
Table 8-20. ABSOLUTE COST EFFECTIVENESS OF CONTROLLING FIXED ROOF
TANK EMISSIONS FROM THE MODEL TANK
Tank Type/Equipment
Emissions Cost Effectiveness
(Mg/yr) ($/Mg)
I. Fixed roof tank
II. Internal floating roof tank
A. Bolted deck, vapor-
mounted primary seal,
uncontrolled fittings
B. Bolted deck, liquid-
mounted primary seal,
uncontrolled fittings
C. Bolted deck, liquid-
mounted primary seal,
controlled fittings
D. Bolted deck, liquid-
mounted primary seal
and secondary seal,
controlled fittings
E. Welded deck, liquid-
mounted primary seal
and secondary seal
controlled fittings
III. External floating roof tank
with mechanical shoe
primary seal and secondary
seal
6.22
0.41
0.34
0.24
0.21
0.17
0.068
41
39
32
137
650
390
Not applicable.
8-29
-------
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8-30
-------
Table 8-22. INCREMENTAL COST EFFECTIVENESS OF CONTROLLING
DECK SEAM EMISSIONS IN THE MODEL TANK
Incremental
Cost Effectiveness
Base Case End Case ($/Mg)
Bolted deck Welded deck 77,900
8-31
-------
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8-32
-------
Table 8-24. INCREMENTAL COST EFFECTIVENESS BETWEEN EQUIPMENT
SPECIFIED BY EACH REGULATORY ALTERNATIVE AND AN EXTERNAL
FLOATING ROOF TANK WITH A MECHANICAL SHOE SEAL AND A SECONDARY SEAL
Regulatory alternative
as ase case Emission reduction Cost effectiveness
Number Equipment (Mg) ($/Mg)
0
I
II
III
IV
V
FR
.IFR
b vm
bIFRlm
bIFRlm,cf
TPR
bir*lm,ss,cf
TCR
wirKlm,ss,cf
6.15
0.34
0.27
0.17
0.14
0.10
390
5,700
7,210
11,700
9,660
NA3
Notation is as follows:
FR = fixed roof tank
IFR - internal floating roof tank
EFR = external floating roof tank
b = bolted deck
w = welded deck
1m = liquid-mounted primary seal
vm = vapor-mounted primary seal
ms = mechanical shoe primary seal
ss = secondary seal
cf = controlled fittings
p
The annualized cost without product recovery credit is calculated as
follows:
Annualized cost = (cost of external floating roof tank + cost of
secondary seal) - (cost of fixed roof tank + cost
of controls).
Regulatory Alternative V is more expensive than the EFR control option.
Therefore, cost effectiveness is undefined. '
8-33
-------
8.7 REFERENCES
1. Basdekis, H. S. Emissions Control Options for the Synthetic Organic
Chemicals Manufacturing Industry; (draft document submitted to
EPA). Hydroscience, Inc. Knoxville, Tennessee. February 1980.
100 p.
2. Blackburn, J. W. Emissions Control Options for the Synthetic
Organic Chemicals Manufacturing Industry; (draft document submitted
to EPA). Hydroscience, Inc. Knoxville, Tennessee. December 1979.
120 p.
3. Memoranda from Shumaker, J.L. to Moody, W. of TRW Environmental
Protection Agency, dated October 11, 1982. Summarizing cost data
from 11 equipment manufacturers and the correlation of data into
general equipment cost equations.
4. "Economic Indicators" Chemical Engineering, May 19, 1980, January
22, 1980, and October 4, 1982.
5. Telecon. Hyatt, Terry, Pittsburgh, Des Moines with Rockstroh, Margaret,
TRW. May 19, 1980. Costs of cone roof tanks, external floating-roof
tanks, and secondary seals.
6. Letter from Rutland, McBarnett, GATX, to Guidetti, R., TRW.
December 3, 1979. Costs for external floating-roof tanks and cone
roof tanks.
7. Telecon. Stilt, George, Pittsburgh Des Moines with May, George,
TRW. April 10, 1980. Costs of external floating roof tanks and
secondary seals.
8. Memorandum regarding internal floating roof deck fittings costs
from J. Shumaker to W. Moody, TRW Environmental Division, Research
Triangle Park, NC. November 8, 1982.
9. Erickson, D. G. Draft Storage and Handling Report; Emission Control
Options for the Synthetic Organic Chemicals Manufacturing Industry.
Hydroscience, Inc. prepared for the U.S. Environmental Protection
Agency, Research Triangle Park, NC. Contract No. 68-02-2577.
October 1978.
10. Unit Process Guide to Organic Chemical Industries, Vol. 1. Science
Publishers, Inc. Ann Arbor, Michigan.
11. News Flashes. Chemical Engineering. 86:12. 1979. p. 77.
12. U.S. Environmental Protection Agency. VOC Fugitive Emissions in
Synthetic Organic Chemicals Manufacturing Industry - Background
Information for Proposed Standards; (Preliminary draft). Research
Triangle Park, North Carolina. March 1980. p. 8-25, 8-26.
8-34
-------
13. Chemical Specialties Manufacturers Cite EPA as Having Biggest
Economic Effect. Chemical Regulation Reporter. November 2, 1979.
p. 1317.
14. Jellinek Says EPA Will Use Authority to Compel Disclosure of PMN
Information. Chemical Regulation Reporter. January 11, 1980.
p. 1586.
15. Nader Group Scores Industry Figures on Costs, Benefits of Health
Regulations. Chemical Regulation Reporter. October 12, 1979.
p. 1107.
16. EPA Estimates TSCA Reporting Role Would Cost Chemical Industry
$6 Million. Chemical Regulation Reporter. Bureau of National
Affairs, Inc. January 11, 1980. p. 1585.
17. Proprosal of Premanufacture Notification Notice Form and Provision
of Rules 40 CFR, Part 720.44(201). Washington, D.C. U.S. Government
Printing Office. October 16, 1979.
18. Arthur Anderson and Co. Cost of Government Regulation Study.
Washington, D.C. March 1979.
19. Cost of Pesticide Cancellations, Suspensions "Nominal," EPA Report
Says. Chemical Regulation Reporter. February 29, 1980. p. 1794.
20. EPA Water Act Regulations for Pesticide Industry Upheld. Chemical
Regulation Reporter. May 18, 1979. p. 220-221.
21. RCRA Waste Disposal Discussed. Chemical Regulation Reporter.
April 27, 1979. p. 93.
22. Union Carbide Sees $2 Billion Price to Upgrade Storage Ponds Under
RCRA. Chemical Regulation Reporter. April 27, 1979. p. 98.
23. Government Considers $6 Billion Fund. Chemical Regulation Reporter.
May 4, 1979. p. 119.
24. Disposal Costs for Handling Wastes Outlined by Consultant at
Conference. Chemical Regulation Reporter. September 21, 1979.
p. 982.
25. Environmental Quality, The Ninth Annual Report of the Council on
Environmental Quality. Council on Environmental Quality.
Washington, D.C. December 1978.
26. Study Reports Costs of Complying with Anticipated EPA Regulations.
Chemical Regulation Reporter. 1978. p. 272.
27. Economic Analyses, Coordination to be Emphasized by IRLG in 1980-1981.
Chemical Regulation Reporter. January 11, 1980. p. 1590.
28. Calendar of Federal Regulations. Federal Register, 44:230.
November 29, 1979.
8-35
-------
9. ECONOMIC IMPACT
9.1 INDUSTRY PROFILE
9.1.1 Introduction
The industry profile describes the economic characteristics of industries
that store volatile organic liquids (VOLs). Its purpose is to provide back-
ground information necessary to formulate and execute the economic impact
analysis of Section 9.2. The discussion begins by identifying and describing
the industries of interest: those involved in VOL production, VOL consump-
tion, and VOL storage at merchant terminals. Information on the basic supply
and demand conditions of these industries, including production and sales
levels and inputs into their production activities, is presented in the basic
conditions subsection. Three subsections are then devoted to a discussion of
the structure, conduct, and performance of firms in the three industry seg-
ments of interest.* The section concludes with a presentation of the meth-
odology and results for projecting the nationwide VOL storage tank population
for the 1984-1S88 period.
9.1.2 Identification and Description of VOL-Storing Industries
9.1.2.1 VOL Producers. Figure 9-1 is a flowchart of the organic chem-
icals industry from raw feedstocks to end products. VOL manufacturers are
part of this industry, which is complex because many chemicals it manufactures
subsequently are used to produce other chemicals. Hegman, for example, esti-
mates that intraindustry shipments constitute as much as two-thirds of total
sales in the organic chemical industry.2 This phenomenon frequently results
in double counting of the output of primary and intermediate chemicals and
hampers accurate measurement of production and sales.
Manufacturers of VOLs are classified in the three-digit standard indus-
trial classification (SIC) code 286, Industrial Organic Chemicals. This
*For the benchtwrk definition of these terms and their role in economic
analysis, see Reference 1.
------- An error occurred while trying to OCR this image.
-------
category also includes establishments primarily engaged in the manufacture of
some nonvolatile and solid chemicals. For example, SIC 286 includes establish-
ments primarily engaged in the manufacture of fabricated rubber and explosives.
While establishments primarily engaged in the manufacture of industrial
organic chemicals are classified in SIC 286, establishments classified in
other SIC industries produce these chemicals as secondary products. Approx-
imately 20 percent of all industrial organic chemicals are produced in estab-
lishments not classified in SIC 286.3
9.1.2.2 VOL Consumers. Industries in SIC 28, Chemicals and Allied
Products, consume the largest amount of VOLs. The largest consuming industry
is also the producing industry: SIC 286, Industrial Organic Chemicals. Other
important consuming industries are SIC 282, Plastics Materials and Synthetics;
SIC 283, Drugs; SIC 284, Soaps, Cleaners, and Toilet Goods; and SIC 287,
Agricultural Chemicals. Booz, Allen, and Hamilton, Inc., conducted a survey
of organic emissions to identify which consuming industries store significant
amounts of VOLs. The survey indicates that industrial organic chemical pro-
ducers, who in most cases are also VOL consumers, accounted for 64 percent of
VOL emissions from storage tanks.4 It also indicates that an additional 20
percent of all VOL emissions from storage tanks within the chemical industry
originated in SIC 282, Plastics Materials and Synthetics. Other consuming
industries each generate less than 5 percent of storage tank emissions and are
not considered further here.
Flows of industrial organic chemicals are traced from SIC 286, Industrial
Organic Chemicals, to other industries, based on U.S. Department of Commerce
1972 input/output tables.5* Major consumers of industrial organic chemicals
not included in SIC 28 are SIC 22, Textile Mill Products; SIC 30, Rubber and
Miscellaneous Plastics Products; and SIC 24, Lumber and Wood Products. The
major types of chemicals provided to these users are dyes, lakes, toners,
creosote oil, rubber-processing chemicals, and plasticizers. Shipments of
^Industrial organic chemicals are included in two input/output commodity
groups: Industrial Organic and Inorganic Chemicals, and Gum and Wood
Chemicals. The commodity-by-commodity input/output table lists the percen-
tage of total U.S. output of the above chemicals consumed by producers of
other commodities. Any commodity that accepted 1 percent or more of the flow
of output of either industrial organic and inorganic chemicals or gum and
wood chemicals was included in the 1972 Census of Manufactures under the
appropriate industry group. Data on consumption of industrial organic
chemicals appear in the input/output table on materials consumed by kind.
9-3
-------
these products amounted to $701 million in 1972, or about 6.1 percent of total
industry shipments from SIC 286.6 Because the amount is so small, storage of
chemicals outside of SIC 28 has been disregarded.
Another user is SIC 516, Wholesale Trade of Chemicals and Allied Products,
whose establishments purchase chemicals for repackaging and reselling. Indus-
try contacts indicate that the storage tanks used by distributors typically
have less than 75 m3 capacity.7 Because this capacity is less than the cut-
offs considered under each regulatory alternative, this profile does not
include wholesale distributors.
9.1.2.3 VOL Storage Terminals. Data on storage services are difficult
to collect for three reasons. First, most of the small private-merchant
terminals that store VOLs do not report financial data publicly. Second, many
of the larger publicly traded companies aggregate data on chemical storage
services with data from other accounting units or with data from storage of
other commodities, making it impossible to assess the financial and economic
performance of VOL storage enterprises from a specific SIC code. Data on
chemical storage services are included in SIC 4226, Special Warehousing and
Storage Not Elsewhere Classified, along with data on merchant warehousing of
other commodities such as petroleum, whiskey, and furs. Thus, data reported
for this category in the 1972 Census of Business Services do not represent
chemical storage services as such. Furthermore, because establishments are
classified by their primary functions and because chemical storage is usually
a secondary function, data on much of the chemical storage industry are con-
tained in SIC industry categories other than SIC 4226. Proprietary or captive
terminals, if used as storage points rather than as wholesale distribution
centers, are classified as auxiliary establishments for which no revenues or
other statistics are reported.
For this report, information on bulk chemical storage was obtained from a
trade association, the Independent Liquid Terminals Association (ILTA). Mem-
bers of this organization range from a merchant terminal operator with 1 ter-
minal comprised of 7 tanks to an operator with 14 terminals and a total of
1,469 tanks. Few terminal operators report revenues or other statistics and,
of those who do, statistics for chemical storage are combined with statistics
for other operations.8 For specific information, nine liquid terminal oper-
ators were contacted. No statistics were collected on proprietary terminals.
9-4
-------
9.1.3 Basic Conditions
This section addresses supply conditions, which are determined largely by
technological considerations, and demand conditions, which depend primarily on
product attributes.
9.1.3.1 Supply Conditions. Employment, assets, and costs of materials
for industrial organic chemicals between 1972 and 1977 are provided in Table
9-1. Total employment in the industrial organic chemical industry increased
about 12 percent over this 5-year period. Assets also have increased since
1972. Expenditures on materials have tripled, largely because of the increased
cost of petroleum-based raw materials.
Resource use in Plastics Materials and Synthetics (SIC 282) is presented
in Table 9-2. In contrast to the industrial organic chemical industry, this
industry is becoming more capital intensive. Total employment fell by almost 3
percent between 1972 and 1977, and the number of production workers declined
by over 4 percent. Over roughly the same period, the value of assets increased
38 percent. Between 1972 and 1977, expenditures on materials increased dramat-
ically, by over 130 percent, primarily because of increased fuel and feedstock
prices.
Capital expenditures and operating rates for the VOL-producing and VOL-
consuming industries are presented in Table 9-3, in both current and constant
dollars, for the years 1958 to 1978. Expenditures by VOL producers declined
for some years prior to 1972. When oil prices increased sharply in 1973,
expenditures started to grow again in real terms, rising by almost 200 percent
over 5 years. A trade survey indicated that these new expenditures were for
improvements in old plants and process efficiency gains rather than for new
capital assets.10 Capital expenditures in SIC 282, Plastics Materials and
Synthetics, have increased steadily since 1958 as demand for plastics has
grown. The most dramatic growth occurred after 1973, when plastics and resins
companies began large expansion programs, after which expenditures declined as
companies invested in process improvements.
9.1.3.2 Demand Conditions.
9.1.3.2.1 VOL producers and consumers. Demand for VOL storage services
depends upon demand for VOL chemicals and upon the inventory and distribution
practices of VOL producers and consumers. VOL producers and consumers choose
to hold inventories, onsite or in terminals, to facilitate production and
9-5
-------
TABLE 9-1. RESOURCE USE BY PRODUCERS OF
INDUSTRIAL ORGANIC CHEMICALS (SIC 286)9
Year
1972
1973
1974
1975
1976
1977
Employment
do3)
136.5
137.8
135.2
137.3
141.8
152.8
Production
workers
(10s)
87.9
89.2
88.2
86.4
90.3
97.9
Cost of ,
materials '
($106)
5,514.4
6,488.4
10,608.8
11,765.7
14,713.9
17,607.7
Assets3'5
($106)
12,490.9
13,258.9
14,068.3
16,360.3
18,972.9
N/A
aCurrent dollars.
The adjective "current" or "nominal" describes the measurement of an economic
magnitude in current prices; i.e., prices pertaining to the year in question.
When current or nominal values are compared for different years, no account
is taken of general price inflation or deflation. By contrast, the adjective
"real" or "constant" refers to attempts to measure economic magnitudes by
the quantity of real goods and services they command; i.e., with the general
rate of inflation deducted to record the real command over resources.
9-6
-------
TABLE 9-2. RESOURCE USE BY PRODUCERS OF
PLASTICS MATERIALS AND SYNTHETICS (SIC 282)9
Year
1972
1973
1974
1975
1976
1977
Employment
(10s)
161.9
164.1
169.8
150.3
152.8
157.1
Production
workers
do3)
116.0
118.6
121.8
104.0
107.0
111.1
Cost of a
materials
($106)
4,854.9
5,310.6
8,521.9
8,591.7
10,687.5
11,552.6
Assets3
($106)
9,468.5
10,090.6
11,268.3
12,220.3
13,047.7
N/A
Current dollars.
9-7
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9-8
-------
sales; i.e., they accept the cost of holding some VOL inventory in exchange
for improved operating productivity and sales. For both producers and con-
sumers, inventories are held in bulk due to economies of scale in storage.
Table 2-4 presents data on production and sales of industrial organic
chemicals for zhe period 1955 to 1981. Production of industrial organic chem-
icals increased at an average annual rate of 6 percent from 1955 to 1974.
However, following the sharp rise in oil prices in 1974 and the decreasing
demand for chenicals during the 1975 recession, 1975 production declined to 85
percent of the previous year's output. Production declined again slightly in
1976 as producers and consumers both tried to reduce inventories. With eco-
nomic recovery, production of industrial chemicals increased, rising to 90 per-
cent of the 1974 output in 1978 and surpassing the 1974 level thereafter.
Physical sales followed a similar pattern, increasing at a 6 percent
average annual growth rate from 1955 to 1973. However, rapidly increasing
feedstock prices in 1974 resulted in higher chemical prices. In 1975, the
physical sales volume dropped to 80 percent of 1973 levels, as the impact of
higher real prices was compounded by the 1975 recession. Physical sales
further declined in 1976 to 77 percent of their 1973 level, began to grow
again in 1977, and rose in 1978 to 83 percent of the 1973 peak. The 1973 peak
was matched in 1979, but physical sales weakened again in 1980 and 1981. Phy-
sical sales of industrial organic chemicals consistently have represented about
50 percent of production over the period 1955 to 1978. The other 50 percent
is 'captively consumed.
Between 1573 and 1981, current dollar sales increased much more rapidly
than did output and physical sales volumes. In some years, dollar sales
increased as chemical prices rose even though production and physical sales
volumes decreased. Dollar sales increased over 50 percent in 1974, while the
physical sales volume fell 3.7 percent. Revenues changed very little as the
volume of physical sales fell sharply between 1974 and 1975. In 1976, dollar
sales began to grow again.
Table 9-5 contains production and sales data for plastics and resins
materials, the largest VOL consumer. From 1955 to 1973, production and physi-
cal sales grew at an annual average of over 10 percent. In 1974, sharply
rising prices for raw materials reduced output by 15 percent although the
physical sales volume grew by over 11 percent. In 1975, physical sales fell
9-9
-------
TABLE 9-4. HISTORICAL PRODUCTION AND SALES OF
INDUSTRIAL ORGANIC CHEMICALS, 1955-198114a
Year
1955
1956
1957
1958
1959
1950
1961
1962
1963
1965
1965
1956
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
Production
(106 Mg)
23.5
27.8
26.7
24.9
25.0
27.1
27.6
30.1
32.5
36.3
40.1
44.3
45.7
51.4
56.8
57.8
57.7
65.6
69.9
71.8
61.0
61.9
61.2
64.6
82.1
77.8
77.5
Physical
sales
(106 Mg)
11.9
12.6
12.7
11.9
12.3
12.9
13.4
14.2
15.1
17.5
19.0
20.8
21.7
24.7
27.4
28.1
28.6
33.3
36.2
34.9
29.0
27.9
29.1
30.0
36.3
34.9
33.8
Ratio of
physical
sales to
production
50.6
45.3
47.6
47.8
49.2
47.6
48.6
47.2
46.5
48.2
47.4
46.9
47.5
48.0
48.6
47.5
46.3
50.8
51.8
48.6
47.5
45.1
47.5
46.4
44.2
44.9
43.6
Dollar
salesb'C
($106)
2,811
3,008
3,097
3,039
3,498
3,672
4,040
4,082
4,210
4,697
5,182
5,762
6,359
7,047
7,277
7,381
7,592
8,558
10,049
15,245
15,355
16,455
17,945
19,397
26,007
29,057
30,995
These data reflect some double counting due to the interindustry trade
.already noted.
These figures are developed by aggregating data in the following
International Trade Commission industrial categories: tar, tar crudes,
cyclic intermediates, dyes, lakes and toners, flavor and perfume materials,
rubber-processing chemicals, plasticizers, pesticides, miscellaneous end-use
chemicals, and miscellaneous cyclic and acyclic chemicals. Prior to 1975,
data on chemicals in the latter category were reported as Miscellaneous
Synthetic Organic Chemicals. Figures for 1976 through 1978 are not strictly
comparable to figures for other years due to a change in one product classi-
fication. The original classification was restored in 1979.
Dollar sales are presented in current dollars.
9-10
-------
TABLE 9-5. HISTORICAL PRODUCTION AND SALES OF
PLASTICS AND RESINS MATERIALS, 1955-198114C
Year
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
Production
(106 Mg)
2.6
2.9
3.0
3.1
3.9
4.1
4.3
5.0
5.5
6.1
6.9
7.9
8.0
9.4
10.7
10.7
11.7
14.0
16.4
13.9
13.4
15.9
18.3
20.2
21.7
19.5
20.6
Physical
sales
(106 Mg)
2.4
2.6
2.7
2.8
3.5
3.6
3.9
4.5
4.7
5.3
5.9
6.8
6.9
8.2
9.0
9.5
10.2
12.3
14.6
16.3
11.3
12.9
15.4
16.9
18.5
16.7
17.9
Ratio of
physical
sales to
production
92
90
90
90
90
88
91
90
85
87
86
86
86
87
84
89
87
88
89
117
84
81
84
84
85
86
87
Dollar
salesb'C
($106)
1,651
1,730
1,811
1,819
2,333
2,351
2,427
2,658
2,770
2,930
3,346
3,658
3,547
3,880
4,235
4,298
4,541
5,353
6,644
9,416
8,461
10,148
12,822
14,224
17,705
18,291
19,597
These data reflect some double counting due to the interindustry trade
already noted.
These figures are based on the summation of two International Trade
Commission categories: plastics and resins materials, and elastomers
(synthetic rubber).
C0ollar sales are presented in current dollars.
9-11
-------
by 30 percent as price increases and the 1975 recession sharply reduced demand
for plastics and resins. Manufacturers reduced 1975 production by only 3.6
percent, however, allowing inventories to increase. In 1976, the physical
sales volume increased again as general economic activity in the United States
began to rise. Physical sales continued to grow in 1977 and exceeded the pre-
vious (1974) peak level from 1978 through 1981.
Dollar sales of plastics and resins grew 14.3 percent annually between
1975 and 1978 as producers of automobiles and other durable goods, responding
to rising energy prices, sought to replace heavier materials (e.g., steel and
glass) with lighter weight plastics. Although prices of plastics and resins
also increased, potentially adverse impacts of those price increases on demand
for these materials were offset by sharply rising prices for substitute com-
modities, steel and glass, which are also manufactured by energy-intensive
production processes. The combined effect of the increased physical sales
volume and rising prices substantially increased dollar sales between 1974 and
1981.
International trade is another potentially important component of demand.
Specific data on the import and export of VOLs is not available. The follow-
ing discussion therefore presents international trade data for Industrial
Organic Chemicals (SIC 286) and Plastics Materials and Synthetics (SIC 282).
International trade data on tank storage services are also unavailable.
Table 9-6 presents data on exports and imports of industrial organic
chemicals for the years 1972-1981. Comparing these data to dollar sales data
indicates that a substantial and, over this time period, growing portion of
sales is for export. Imports of industrial organic chemicals have been
growing at about the same rate as have industry sales but are much smaller
than the level of exports, so trade in industrial organic chemicals has con-
tributed favorably to the U.S. balance of trade.
Table 9-7 presents data on exports and imports of plastics materials and
synthetics. These data also indicate a favorable balance of trade. Growth in
the value of both exports and imports has just kept pace with the value of
industry shipment. International competition in Plastics Materials and Resins
(SIC 2821), however, is expected to erode favorable trade balances that sector
currently maintains.16
9.1.3.2.2 VOL storage terminals. Chemicals are stored in terminals for
9-12
-------
TABLE 9-5. EXPORT AND IMPORT VALUES OF INDUSTRIAL ORGANIC CHEMICALS (SIC 286)
EXCLUDING GUM AND WOOD CHEMICALS (SIC 2861)
FOR SELECTED YEARS BETWEEN 1972 AND 198115
Year
1972
1977
1978
1979
1980
1981
Estimated.
TABLE 9-7.
AND SYNTHETICS
Year
1972
1977
1978
1979
1980
1981
Exports
1,073.1
2,879.4
3,812.9
5,493.9
6,292.1
6,500.0a
EXPORT AND IMPORT VALUES OF
(SIC 282) FOR SELECTED YEARS
Exports
766.9
1,751.6
1,973.5
3,181.2
3,973.5
3,861.2a
Imports
448.6
1,094.8
1,484.2
1,784.7
2,008.7
2,050.0a
PLASTICS MATERIALS
BETWEEN 1972 AND 198116
Imports
273.2
385.6
509.6
513.8
521.2
597. 8a
Estimated.
9-13
-------
short periods partly because of the need for transshipment: changes in the
mode of transportation between origin and final destination. Chemicals often
are moved in large bulk shipments to a distribution center by barge or rail
car. These large shipments are then partitioned into smaller lots for trans-
port by truck to areas not served by barge or rail. The amount of transshipment
undertaken depends upon locations (origin and destination), alternative trans-
portation costs, product stability, and storage costs.
Terminals are operated on a proprietary basis and by independent companies.
Proprietary terminals are owned and operated exclusively by chemical producers
as part of their distribution systems. Independently operated facilities,
often called merchant terminals, provide storage services on a contract basis.
The merchant terminals lease capacity to chemical producers near markets not
served by appropriate proprietary terminals and at points where transshipment
occurs. They may also be used by producers when extra storage capacity is
required on a short-term basis.
Most terminal operations store other liquid and dry bulk commodities in
addition to VOLs. Liquids like petroleum, fats, fertilizers, and dry goods of
many types commonly are stored at terminals. Depending on the terminal's
location, chemicals account for 5 to 25 percent of a facility's bulk, liquid
capacity and a slightly greater percentage of revenues from bulk liquid
storage.9 At any given time a small percentage of a terminal's capacity will
hold VOLs. Conversion of a tank from another use to .VOL storage is possible
but requires purging of the tank, an expensive and time-consuming process
undertaken only about once every 5 to 10 years. Therefore, most tanks are
believed to be in designated service as far as VOL storage is concerned.
9.1.4 Market Structure
Issues addressed in the market structure section of this profile include
vertical integration, market concentration, geographic distribution of plants,
and barriers to entry.
9.1.4.1 Vertical Integration. A firm that produces raw materials or
fabricated inputs used in the production of its primary output or that engaged
in further processing of its primary output is said to be vertically integrated.
Vertical integration is apparent among firms that produce, consume, and store
VOLs.
9.1.4.1.1 VOL producer and consumer firms. The relationship between a
9-14
-------
firm's production cost and output price is affected, among other things, by
the extent to which the industry is vertically integrated. Within VOL produc-
tion and consumption, vertical integration is extensive. Captive consumption
of VOLs averaged about 52 percent of total output during the period 1955 to
1978, a ratio that varied only slightly from year to year (see Table 9-4).
Vertical integration of VOL production and consumption extends to storage
services. In addition to proprietary storage at the production site, many
large firms establish proprietary terminals that can serve the needs of nearby
markets quickly. Because VOL producers and consumers manufacture a range of
non-VOL products, proprietary terminals also provide storage for other chem-
ical and petroleum products (e.g., fuels). When proprietary storage capacity
is not available, merchant terminals are leased to store these chemicals.
9.1.4.1.2 Merchant terminals. Many merchant terminal companies are
proprietorships or partnerships, some with only a single terminal, and many
are vertically integrated into distribution or repackaging services. Petro-
leum distributors are the most typical type of merchants providing chemical
storage. A few operators are large, international corporations with many
terminals in the United States and abroad. Typically, these large firms are
integrated vertically into distribution and other transportation services.
9.1.4.2 Market Concentration. Market concentration addresses the issue
of whether individual market participants exercise economic power. Typically,
market concentration indicates the share of business held by leading firms in
an industry. Concentration ratios based on the four largest producers in an
industry are cited most frequently.
Hundreds of VOL chemicals exist, covering a wide variety of production
characteristics, output levels, applications and, consequently, market con-
ditions. Many VOL chemicals (e.g., formaldehyde and alcohols) are manufac-
tured by a relatively large number of firms through various processes. The
products have a wide range of end uses in which substitute materials often can
be used. These markets therefore tend to be highly competitive. Other VOL
chemicals (e.g., succinonitrile and isoamylene) are manufactured by a small
number of producers (in some cases, only one) and have no close substitutes in
their end uses. In these markets, producers may be able to influence market
prices considerably, at least in the short run.
The precise degree of market concentration in VOL production and consump-
9-15
-------
tion is difficult to evaluate because it varies considerably among products.
However, a general assessment of the industry-wide situation may be made based
on capacity share data presented in Table 9-8. These data suggest that no one
company or group of companies dominates the industry. In 1976, the top 4 com-
panies owned only 18 percent of total VOL capacity and the top 20 firms owned
45.39 percent of total VOL capacity.
9.1.4.3 Geographic Distribution of Plants.
9.1.4.3.1 VOL producers. The location of VOL storage is extremely
important to determinate its commercial value. Table 9-9 contains 1972 and
1977 data on geographic distribution of production sites of industrial organic
chemicals.* VOLs are produced in almost every region of the country.! Most
of the plants are small, employing fewer than 20 workers. The largest plants
are clustered in the South near raw material supplies and in the Middle Atlan-
tic States close to industries that use the finished products.
The 1977 statistics suggest that three changes may have taken place in
the VOL-producing and VOL-consuming industries. First, a shift in the loca-
tion of plants is apparent among different regions of the country. These data
indicate that the number of plants in the Middle Atlantic and West North
Central States is declining and that a large portion of the new plants are
being constructed in the East North Central and West South Central States.
Second, plant size, as measured by the number of employees, appears to be
increasing. In each of the three sectors comprising SIC 286, Industrial
^Industry definitions for SIC 2861, SIC 2865, and SIC 2869 used by the Bureau
of the Census do not correspond precisely to definitions of the organic
chemicals industry used by the International Trade Commission. Thus, data
presented in Table 9-9 are not strictly comparable with data presented in
Table 9-4.
tGeographic regions as defined by the Bureau of the Census are: NORTHEAST
New England States: Connecticut, Maine, Massachusetts, New Hampshire,
Rhode Island, and Vermont. Middle Atlantic States: New York, New Jersey,
and Pennsylvania. NORTH CENTRAL East North Central States: Ohio, Indiana,
Illinois, Michigan, and Wisconsin. West North Central States: Minnesota,
Iowa, Missouri, North Dakota, South Dakota, Nebraska, and Kansas. SOUTH
South Atlantic States: Delaware, Maryland, District of Columbia, Virginia,
West Virginia, North Carolina, South Carolina, Georgia, and Florida. East
South Central States: Kentucky, Tennessee, Alabama, and Mississippi. West
South Central States: Arkansas, Louisiana, Oklahoma, and Texas. WEST
Mountain States: Montana, Idaho, Wyoming, Colorado, New Mexico, Arizona,
Utah, and Nevada. Pacific States: Washington, Oregon, California, Hawaii,
and Alaska.
9-16
-------
TABLE 9-8. INDUSTRY-WIDE MARKET CONCENTRATION BASED ON
CAPACITY SHARE DATA, 197617
Number Percent Estimated Percent of
of firms of firms capacity (Mg) industry capacity
Top 4 0.72 58,751.8 18.3
Top 8 1.43 91,820.6 28.6
Top 20 3.58 145,752.34 45.39
Top 40 7.17 186,681.62 58.14
9-17
-------
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Organic Chemicals, the percentage of large plants increased. Third, a shift
in resources away from SIC 2861, Gum and Wood Chemicals, to SIC 2869, Indus-
trial Organic Chemicals Not Elsewhere Classified, is apparent. The former
industry lost 20 plants and the latter gained 55 plants in 5 years.
9.1.4.3.2 VOL consumers. The geographic distribution of VOL consumers
is presented in Table 9-10. In general, plants in this industry (SIC 282,
Plastics Materials and Synthetics) are larger than VOL-producing plants are;
over 75 percent of SIC 282 firms employ more than 20 workers. Overall, the
industry is not as geographically concentrated as the industrial organic chem-
ical industry is; but a high proportion of the plants are located in the
Middle Atlantic, South Atlantic, and East North Central States.
9.1.4.3.3 Terminals. Data on capacity of merchant storage terminals, by
State, are presented in Table 9-11. Over half (51 percent) of ILTA members
are located in Texas, Louisiana, and New Jersey. These data must be inter-
preted cautiously with respect to VOL storage, however, because capacity esti-
mates include many large petroleum storage tanks.
Although data on proprietary storage are not available, major oil firms
that also produce VOLs often use their petroleum distribution terminals to
handle chemicals. Many of these terminals, along with a number of terminals
owned by chemical producers, are located along the inland waterway system that
covers the North Central and Southern States.
9.1.4.4 Barriers to Entry. Although entry into and departure from the
principal industries storing VOL could not be measured directly, some general
comments are appropriate about conditions facing firms considering entry into
the industry. Entry can take two forms. First, a chemical producer or con-
sumer can enter by acquiring tanks for proprietary storage or vertical
integration. These firms face apparently surmountable barriers of capital
formation, expertise, and local laws and standards. A storage facility
requires expenditures for tanks, land, and concrete pads. Support services,
labor, and maintenance must be provided. Such firms also must find or develop
expertise in managing storage operations.. Before construction of the facility
can begin, permits must be obtained from Federal, State, and local Government
agencies, and construction usually must conform to standards set by private
organizations. All of these barriers can be overcome if the internal rate of
return on the investment is sufficiently attractive. Alternatively, many
firms can bypass legal barriers to entry by purchasing an established storage
facility.
9-19
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9-20
-------
TABLE 9-11. TOTAL 1982 MERCHANT LIQUID BULK CAPACITY, BY STATE8
State
Total capacity
(m3)
Share of total
U.S. capacity
Alabama
Arizona
Arkansas
Cal i form' a
Colorado
Connecticut
Delaware
Florida
Georgia
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maryland
Michigan
Minnesota
Mississippi
Missouri
Nebraska
Nevada
New Jersey
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
South Dakota
Tennessee
Texas
Virginia
Washington
West Virginia
Wisconsin
Total
337,269
24,009
72,989
1,428,962
12,100
550,459
184,758
294,198
663,982
1,866,126
135,180
781,948
291,471
4,055
4,001,388
260,190
39,988
581,719
154,548
239,763
273,035
8,268
4,230,975
1,464,066
409,807
126,271
257,501
440,876
429,917
1,416,862
156,186
133,823
5,944,659
20,218
187,886
120,840
64,939
27,617,231
1.22
0.09
0.26
5.17
0.04
1.99
0.67
1.06
2.40
6.76
0.49
2.83
1.06
0.01
14.51
0.94
0.14
2.11
0.56
0.87
0.99
0.03
15.32
5.30
1.48
0.46
0.93
1.60
1.56
5.13
0.57
0.48
21.53
0.07
0.68
0.44
0.24
100.00
9-21
-------
Potential merchant terminal operators face similar barriers, among them
capital formation, which is often more difficult for the small business than
for the larger business. Also, capital formation may be more difficult for
new terminal operators than for existing operators wishing to expand their
operations but is not anticipated to represent a barrier sufficient to prevent
entry into the industry.
9.1.5 Market Conduct
This section focuses on pricing behavior in the industrial organic chem-
icals and merchant terminals industries. The observations could be helpful
for assessing the price impacts of the proposed new source performance stand-
ard (NSPS).
9.1.5.1 Chemical Pricing. VOL producers and consumers manufacture many
chemicals embracing a wide variety of characteristics. Potential for substi-
tution and/or intermediate competition varies considerably from chemical to
chemical. In general, though, a price-induced incentive to substitute is
diminished by the fact that good substitutes are frequently also VOLs. The
substitutes are therefore also subject to cost and price changes related to a
storage standard or other common factors.
Table 9-12 presents price data for industrial organic chemicals and plas-
tics, resins, and elastomers materials from 1955 to 1981. These data indicate
that during the era of stable, low-energy prices from 1955 to 1973, chemical
prices remained stable in current terms and declined slightly in constant terms.
Following the rapid increase in energy prices in the fall of 1973 and in 1974,
the average current price of organic chemicals rose sharply and continued to
increase between 1975 and 1981. However, constant prices increased at a much
slower rate than did current prices.
Data in Taile 9-12 also indicate that both current and constant prices
for plastics and resins declined during the period 1955 to 1972 as energy
prices remained stable and production technology improved. However, the sharp
increase in raw rraterial prices in 1973 resulted in a 29 percent increase in
current prices for those products between 1973 and 1974. The product prices
of the industry again increased substantially between 1974 and 1975. There-
after, the rate at which current prices increased slowed, and real prices
remained stable between 1975 and 1977. Between 1977 and 1981, the real price
of plastics, resins, and elastomers fell.
9-22
-------
TABLE 9-12. HISTORICAL PRICE DATA FOR INDUSTRIAL ORGANIC CHEMICALS
AND PLASTICS, RESINS, AND ELASTOMERS, 1955-1981
Industrial organic
chemicals
Plastics, resins, and
elastomers
Average unit prices
Year
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
Current3
(C/kg)
24
24
24
26
28
28
30
29
28
27
27
28
29
29
27
26
27
26
28
44
53
59
62
65
72
83
92
Constant
(
-------
9.1.5.2 Merchant Terminal Storage Pricing. Results of a telephone sur-
vey of nine merchant terminal operators suggest two general pricing schemes
are practiced. Under the simpler method, the terminal charges a fee (often
called a throughput fee) for each unit of chemical that passes through its
storage tanks.* Individual terminals adjust throughput fees to reflect varia-
tions in quality of storage service provided to the customer and in physical
properties of the chemical to be stored.
Under the more complex pricing system, the terminal charges a basic fixed
fee for the duration of the storage contract to recover fixed costs associated
with the terminal's storage facilities and costs associated with handling a
minimum volume of throughput.t If throughput exceeds the level on which the
minimum charge is based, the terminal levies an additional per-unit charge on
the additional volume of chemicals it handles to cover the cost of additional
labor, energy, and materials inputs. Often, as the volume of throughput and
the number of tank turnovers (throughput divided by tank capacity) increase,
the price charged by the terminal for additional throughput is reduced, re-
flecting economies of scale in handling large numbers of turnovers.^ Com-
panies apparently vary the fixed fee they charge according to market
conditions so discounts may be offered when demand for storage services is
low. Payment for additional throughput services is made in two parts. Half
of the throughput rate is collected as the chemicals are unloaded from trucks,
rail cars, or barges into the storage tank and the remainder is collected as
*For example, a customer may require storage for 1.5 million £/yr of methyl
alcohol. If the throughput rate for methyl alcohol is 3
-------
the chemicals leave storage. The basic fee is collected while the tank is
used.
Other storage pricing systems may be used in addition to the two methods
described here but were not identified in the survey, which covered only
approximately 10 percent of all merchant terminal operators. Details of the
pricing policies used by the remaining. 90 percent of VOL merchant terminals
were not available.
Finally, it should be noted that virtually every storage contract is
unique because of the large number of services offered by terminals to
customers. Variables that affect basic rates and throughput surcharges in-
clude options that may be added to a tank (e.g., floating roofs, nitrogen
blankets, refrigeration, insulation, steam heating, special linings, auxiliary
pumps, vapor recovery systems, and other pollution control devices), modes of
transportation, length of contracts,* age of tanks,t and corrosivity and
toxicity of chemicals.f Additional services add to storage costs, which are
passed directly to the customer in the contract.
9.1.6 Market Performance
9.1.6.1 VOL Producers' and Consumers' Financial Characteristics. Two
recent EPA reports presented data and results of an analysis on fiscal year
(FY) 1977 financial data for a sample of 100 chemical firms.23'24 It was
estimated that the average aftertax cost of capital measured in current dollar
terms for chemical firms was 10.81 percent. If capital costs are distributed
normally, S5 percent of the industry firms face aftertax capital costs ranging
from 8.95 to 12.67 percent.
9.1.6.2 Merchant Terminals' Financial Characteristics. A financial pro-
file of terminal services could not be developed because (1) financial data
are not provided by many firms and (2) data on the terminal operations of ver-
tically integrated firms are not reported separately from other operations on
Security and Exchange Commission (SEC) 10K forms.
The basic rate of a 1-year contract is likely to be higher than that of a
15-year contract due to the capital recovery factory.
fin Texas, State regulations require different designs on tanks built before
and after 1976.
fCorrosivity requires relining of the tanks, and toxicity requires special
handling equipment and techniques.
9-25
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9.1.7 Projected New and Reconstructed VOL Storage Tanks: Calendar Years
1984-1988
The projection for new and reconstructed tanks has two components: tanks
that replace retiring tanks and tanks that increase total storage capacity.
The projection's methodology and results for each component are discussed
separately below.
Replacement tanks were projected by three steps. First, the number of „
tanks in place in each of the years 1954-1977 has been estimated by using the
Federal Reserve Board index of organic chemical production as a proxy of VOL
chemical production capacity during the 1954-1977 period.25'26 This index has
been smoothed through regression procedures,* and the total number of VOL
tanks in place for each of the years is computed based on the regression equa-
tion and 1977 data on the number of VOL storage tanks.27'28 Inherent in this
procedure is the assumption that the ratio of storage capacity to production
capacity is constant.
Second, a tank age profile for 1977 has been constructed by using a recur-
sive procedure that assigns ages to tanks based upon the number of tanks
existing in the prior years as established in the first step of this metho-
dology. Additional assumptions required for this procedure are as follows:
1. A tank's economic life is assumed to be 20 years, an assumption
consistent with the tank cost methodology of Chapter 8.
2. During the initial year (1954) of the recursive process the age of
tanks was uniformly distributed between 1 and 20 years. This assump-
tion is fairly arbitrary but, because the number of tanks estimated
in 1954 (3,800) is estimated to be less than 14 percent of the total
number in 1977 (27,540), alternate assumptions are unlikely to pro-
duce substantially different results.
3. All obsolete (20-year old) tanks were replaced and new tanks pur-
chased at the beginning of each year. This assumption is necessary
simply because the recursive procedure is a discrete approximation
*The smoothed data are the predicted values of the index with a log linear
specification: In Y. = .079 t. In Y. is the natural logarithm of the
production index for year t (t = 1954 to 1977), and .079 is estimated
through least squares procedures with the regression line constrained to
pass through the observation for 1977.
9-26
-------
of a continuous process. Alternate assumptions, including refine-
ments in the time interval used, are also unlikely to produce sub-
stantially different results.
The recursive procedure works as follows: given the age distribution of
tanks in 1954 (assumption 2 above), age all existing tanks 1 year, compute the
number of replacement tanks required in 1955 (the number of tanks that have
aged to 21), compute the number of new tanks required in 1955 (the difference
between the total tanks in 1955 and 1954), and construct an age distribution
of tanks in 1955. This process is repeated year by year until an age distri-
bution of tanks for 1977 has been generated.
The third step in projections of tank replacement for 1984-1988 is to use
the 20-year economic life assumption and the age distribution of tanks in 1977
to compute the number of tanks in each of the projection years. That is, each
tanks in the 1977 age profile that will be 21 years old in a projection year
will be replaced in that year. These results indicate that 4,900 replacement
tanks will be constructed during the period 1984-1988 (see row 1 of Table 9-13).
Projected VOL storage tanks construction that adds new capacity nationwide
is based upon forecasted growth of the organic chemicals industry. The Federal
Reserve Board index of organic chemical production, extrapolated to the
1984-1988 period from data for the period 1954 to 1977, indicates an average
annual growth rate of about 7.9 percent. Chemical industry observers from the
American Chemical Society and the U.S. Department of Commerce have independ-
ently indicated some apparent slackening in long-term growth in the organic
chemicals sector and a probably more realistic growth rate of 4 to 6 percent
for the projection period.29'30 On this basis, 5 percent annual growth in the
organic chemicals industry and proportionate increases in tank and production
capacities are assumed to project new capacity tanks (see row 2 of Table 9-13).
Over the period 1984-1988, 10,200 new capacity tanks are projected. By com-
parison, a 7.9 percent growth rate from 1977 would have resulted in a projec-
tion of 21,620 new capacity tanks in the period. Total new tank construction
in the projection period is shown in row 3 of Table 9-13.
Finally, the projection of new tanks during 1984-1988 is disaggregated by
capacity and vapor pressure. A 1977 survey of VOL storage tanks provided an
estimated pressure and volume distribution for the tanks (see Table 9-14 for a
summary).31'32 This percentage distribution table was secular multiplied by
9-27
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9-28
-------
TABLE 9-14. ESTIMATED PERCENTAGE DISTRIBUTION OF VOL STORAGE TANKS
BY VAPOR PRESSURE AND TANK CAPACITY, 1977a
Vapor pressure (KPa)
Capacity
(m3)
0-75
75-150
150-375
375-3,750
3,750-15,000
>15,000
TOTAL
0-
3.5
27.98
9.26
8.94
12.84
1.12
0.03
60.17
3.5-
6.9
6.55
1.58
1.68
2.98
0.36
0.00
13.15
6.9-
10.3
3.22
0.93
1.17
1.58
0.35
0.07
7.32
10.3-
34.5
5.14
2.32
2.28
5.59
1.10
0.19
16.62
34.5-
58.6
1.23
0.03
0.19
0.46
0.09
0.00
2.00
>58.6
0.39
0.13
0.06
0.16
0.00
0.00
0.75
TOTAL
44.51
14.25
14.32
23.61
3.02
0.29
100.00
The original percentage distribution table covers 24 volume intervals and 18
pressure intervals. This table summarizes the distribution table for relevant,
aggregate intervals of both volume and pressure. All computations of
economic impact were performed using the intervals and data of the original
distribution table.
9-29
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the projected new tank totals of Table 9-13 to yield volume and pressure inter-
vals for the period 1984-1988.* Table 9-15 shows the summary results of this
multiplication for all new tanks projected for 1984-1988. This application of
the estimated 1977 tank distribution assumes the VOL storage tank distribution
by vapor pressure and tank size will remain constant over time.
All projections described in this subsection are based on assumptions and
data described above. While they are as accurate as the data and assumptions
permit, changes in the economy, technological advances, development of competi-
tive substitutes, discovery of new product uses, and changes in market stability
may affect actual industry growth. Such occurrences are difficult to antici-
pate. These projections reflect the most probable scenario and are the best
possible, given the data available.
9.2 ECONOMIC IMPACTS OF REGULATORY ALTERNATIVES
This section presents the estimated impacts of the regulatory alterna-
tives on the users of VOL storage tanks. Six regulatory alternatives are
considered, the first of which is the baseline case from which the impacts are
measured. In general, the alternatives are increasingly more stringent moving
from the baseline to Regulatory Alternative V. The economic impacts considered
in turn are: the impact on the price of the output of the two model plants,
the impact on investment in the two model plants, the impact on investment in
VOL storage nationwide and the impact on the annual costs of VOL storage nation-
wide.
9.2.1 Product Price Impacts
Estimates of the impact of the regulatory alternatives on product prices
have been developed based on two model plants: an independent storage terminal
and a VOL chemical producer/consumer. The tank requirements and other charac-
teristics of these two facilities are described in detail in Chapter 6. They
were selected for analysis because it is believed that they would experience
relatively greater than average cost impacts as a result of the imposition of
any of the regulatory alternatives. Before turning to the estimates, a brief
description of the general approach and assumptions is first presented.
In the long-run the market price of a product produced by a competitive
industry is equal to the average cost, including a normal return on investment,
*There are 24 volume intervals and 18 vapor pressure intervals in the original
percentage distribution table.
9-30
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TABLE 9-15. PROJECTION OF VOL STORAGE TANK CONSTRUCTION .
BY VAPOR PRESSURE AND TANK SIZE, 1984-19883'0
Vapor pressure (KPa)
Capacity
(m3)
0-75
75-150
150-375
375-3,750
3,750-15,000
>15,000
TOTAL
o-
3.5
4,500
1,490
1,440
2,070
180
10
9,680
3.5-
6.9
1,050
250
270
480
60
0
2,120
6.9-
10.3
520
150
190
250
60
10
1,180
10.3-
34.5
830
370
370
900
180
30
2,670
34.5-
58.6
200
10
30
70
20
0
320
>58.6
60
20
10
30
0
0
120
TOTAL
7,160
2,290
2,300
3,890
490
50
16,090
The original percentage distribution table covers 24 volume intervals and 18
pressure intervals. This table summarizes the distribution table for relevant,
aggregate intervals of both volume and pressure. All computations of
economic impact were performed using the intervals and data of the original
distribution table.
Rows and columns may not sum to totals due to rounding.
9-31
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of new facilities. This is because firms will not choose to build a new facil-
ity unless they anticipate that the market price will be sufficient to cover
all costs. Thus, the change in the average operating cost of a new facility
due to an NSPS is the best point estimate of the long-run product price impact
of the regulatory alternatives under consideration. In a case such as that
presented here, where the model facilities utilized would be expected to experi-
ence greater than typical cost increases, the average industry price effects
measured in this way would be overstated.
As documented in Chapter 8, all the regulatory alternatives except the
baseline will increase tank fabrication costs. This increase in cost can be
taken as the increase in the price of tanks to the VOL tank users based on the
same logic as outlined above. For a constant cost tank industry, as illus- m
trated in Figure 9-2, this increase in average costs will show up as a vertical
shift in a horizontal supply curve from S to S1. The price of tank type i in
year t will rise from P to P1.
However, the long-run impacts of the regulatory alternatives on the price
of VOL storage services cannot be simply calculated from this price change
alone. This is because the regulatory alternatives considered here impact ser-
vices and performance, as well as the price of the tanks. In principle, at
least, these impacts can affect the cost of storage services in three ways:
they reduce the effective capacity of a tank due to the insertion of an inter-
nal roof; they reduce storage capacity requirements because they improve
storage efficiency, and they reduce VOL vaporization and, hence, VOL losses.
The first impact is mechanical in origin: an internal floating roof
occupies 1 to 2 feet of vertical space in a storage tank, thus decreasing the
effective capacity of the tank. The capacity reduction is inversely related
to the height of the tank and ranges between 6 and 12 percent of capacity for
a 75-ic3 tank that is 16 feet high and between 2 and 4 percent of volume for a
20,000-m3 tank that is 48 feet high. Thus, everything else being equal, this
feature of the regulatory alternatives would tend to increase the number of
tanks impacted as more tanks would be needed to store a given volume of VOL.
Second, the reduction in VOL vaporization accompanying the regulatory
alternatives will affect the capacity requirements of VOL storers. Specif-
ically, the use of more efficient tanks means that less VOL will be needed to
serve given production or marketing requirements. Thus, everything else being
9-32
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$/Tank
P'
S'
Tt 4+1 Tanks/Year
Figure 9-2. VOL storage tank market for tanks in volume interval i
as characterized in the economic impact analysis.
9-33
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equal, this feature of the regulatory alternatives would tend to decrease the
number of tanks impacted. Fewer tanks would be needed to store a given volume
of VOL. The magnitude of the reduction in tank requirements will depend on
the effectiveness of vapor emissions reduction and the relationship between
storage tank capacity and VOL use. Assuming a capacity to throughput ratio of
0.4 and the equipment effectiveness described in Chapter 7, the requirement
for tank storage capacity would be reduced by roughly 1 percent.
The proposed regulatory alternatives therefore initiate two influences on
storage costs that work in opposite directions. Since the magnitudes of these
influences are thought to be relatively small as well as contrary, no attempt
is made to adjust estimates of VOL storage tank requirements to account for
them in each regulatory alternative.
The final impact is also technical in origin but has important economic
implications. In particular, since the additional equipment required by the
regulatory alternatives will reduce the amount of VOL vaporized, fewer valu-
able VOLs will be lost to the atmosphere. Therefore, this quality improvement
in the tanks will at least partially offset any increase in the price of the
tanks. This consideration is incorporated into the analysis. With this back-
ground, the mechanics of the procedure used to develop the price impacts in
next discussed.
The change in the price of VOL storage services was estimated for both
model plants using Equation 9-1:
20 _t
kn + k, = ITC + I [(1 - G)(P • Q - C) + G'D,] (1 + r) r , (9-1)
u i t=1 t
where kQ = initial incremental investment
k.. = incremental investment in year 10 discounted to the
present
ITC = the investment tax credit (10 percent)
r = real after tax rate of discount (10 percent)
t = year (1,2,3,. . .,20)
Q = annual output
P = change in price
9-34
-------
C = incremental annual operating cost
G = tax rate (49 percent)
D. = straight line depreciation in year t, with an assumed 20
year commercial life for floating roofs and 10 year
commercial life for seals.
Equation 9-1 is a financial balance equation that states that the present
value of the investment and operating costs required by the regulatory alter-
native must be equal to the present value of the stream of revenues. By
solving the equation for P, one obtains the change in the price of the product
or service required if the plant or terminal operator is to achieve a return
on investment for the mandated equipment that is competitive with other invest-
ment opportunities.
The general features of the financial balance computation are as follows.
The firm obtains a 10 percent investment tax credit on the equipment purchase.
The computation is done on an after tax basis where the income tax rate is 49
percent of net revenues. All revenues are in constant 1982 dollars, so the 10
percent rate of discount selected for this analysis is a constant (or real)
after tax rate. A 10 percent rate of discount is consistent with that employed
in Chapter 8 for annualization of capital costs. As discussed in Section 9.1,
financial data for 1978 from a sample of 100 chemical companies shows an
average after tax rate of return of 10.81 percent. Given the inflationary
economic environment of 1978, the real rate of return to the firms would
likely have been somewhat less that 10 percent. Using a real after tax dis-
count rate that is arguably high tends to overstate the price impact of the
regulatory alternatives. Finally, a 20-year commercial life for tanks was
assumed in keeping with the analysis of Chapter 8.
Parameters assumed in the use of Equation 9-1 include a model terminal
throughput rate of 39 x 10 kg/year and a model VOL producer/consumer output
of 80 percent of a production capacity of 4.5 x 10 kg/year. Capital costs
and operating expenses are taken from Chapter 8. Equation 9-1 was solved both
without and with adjustments allowing a $460/Mg emission savings credit to be
subtracted from operating costs for each model plant. The $460/Mg figure is
based upon a weighted average price of organic chemicals computed for 1978
production and prices as inflated to 1982 dollars by a chemical producers
9-35
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price index.*
The projected price impacts on VOL storage services of the regulatory
alternatives with and without the emission savings credit are shown in
Table 9-16. As was anticipated, the price impacts increase with increases in
the stringency of the regulatory alternatives. Recognition of the value of
emission savings reduces the price impacts somewhat.
To help place these values in perspective, the price impacts were divided
through by the estimated product price and multiplied by 100 to obtain esti-
mates of the percentage change in the product prices for the two model plants.
S460/Mg was used to estimate the product price of the model producer/consumer
and $0.01/kg was used as the average storage charge of the model independent
terminal. This later value is based upon an estimated capital cost of the
model terminal, inclusive of land and tank foundations, of $1.72 x 106 1982
dollars and operating costs equal to 7 percent of the capital costs. The l$/kg
figure was determined by applying these costs to Equation 9-1 and solving for
price. This capital cost is probably very conservative since it excluded the
purchase and installation cost of pumps, piping, gauges, etc., that ordinarily
constitute a substantial portion of the capital expenses of a storage terminal.
If higher capital costs were used, the computed price of storage would be
higher, and the percentage change in price due to the regulatory alternatives
would be even lower.
Table 9-17 presents the estimated percentage changes in VOL storage prices
and VOL output prices. These percentages are very small for the model producer/
consumer since VOL storage is such a small part of his costs. The percentage
change in the average price of storage at the model terminal is somewhat higher,
ranging from 3.7 to 4.3 percent for Regulatory Alternatives I through IV and
11.8 percent for Regulatory Alternative V with an emission savings credit.
9.2.2 Investment Impacts
The investment impacts of the regulatory alternatives for the model plant
and VOL storage industry are provided below.
9.2.2.1 Model Plant Investment Impacts. As reported in Chapter 8, the
installed capital cost of VOL storage tanks alone for the model terminal is
*The 1978 weighted average price was obtained from Reference 24. Inflation to
1982 was performed using the Industrial Chemical Procedures Price Index from
the Chemical Engineering Journal. The adjustment is documented in Reference
33.
9-36
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TABLE 9-16. PRICE IMPACTS OF THE REGULATORY ALTERNATIVES
FOR THE MODEL TERMINAL AND MODEL PRODUCER/CONSUMER
Model independent
terminal
(t/kg)
Regulatory
alternative
I
II
III
IV
V
Without
emission
savings
credit
0.049
0.050
0.051
0.056
0.132
With
emissi on
savings
credit
0.037
0.038
0.038
0.043
0.118
Model producer/
consumer
(«t/kg)
Without
emission
savings
credit
0.15
0.17
0.20
0.23
0.72
With
emission
savings
credit
0.11
0.11
0.11
0.14
0.63
*The emission savings credit is calculated in Chapter 8 based on a price
for VOL of $460/Mg ($ 1982).
9-37
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TABLE 9-17. PERCENTAGE CHANGE IN OUTPUT PRICE FOR THE MODEL
PLANTS DUE TO THE REGULATORY ALTERNATIVES
Model independent
terminal
Regulatory
alternative
I
II
III
IV
V
Without
emission
savings
credit
4.9
5.0
5.1
5.6
13.2
With
emi ssion
savings
credit
3.7
3.8
3.8
4.3
11.8
Model producer/
consumer
Without
emi ssion
savings
credit
0.3
0.4
0.4
0.5
1.6
With
emission
savings
credit
0.2
0.2
0.2
0.3
1.4
The average price of storage per kg was assumed to be $0.01 ($ 1982).
DThe average price of VOL was assumed to be $460/Mg ($ 1982).
"The emission savings credit is calculated in Chapter 8 based on a price
of VOL of $460/Mg ($ 1982).
9-38
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1.07 million in 1982 dollars. The installed capital cost of the storage tanks
alone of the model chemical producer/consumer was estimated to be 0.25 million
1982 dollars. Incremental capital costs were computed for each of the model
plants for each of the regulatory alternatives. These costs, previously pre-
sented in Chapter 8, are consolidated in Table 9-18. They show additional
investment requirements of between 56 and 185 thousand 1982 dollars for the
independent terminal and between 16 and 91 thousand 1982 dollars for the model
producer/consumer of VOLs.
9.2.2.3 Nationwide Investment Impacts. Nationwide impacts depend on the
volume and vapor pressure characteristics of new tanks in each year of analysis.
Therefore, the first step in the estimation of the nationwide investment impact
of regulatory alternatives is to estimate the number of new tanks that would
be subject to VOL regulations by year, t; by volume interval, i; and by pres-
sure interval, p. As described in Subsection 9.1.7, this is done by scalar
multiplication of each of the annual projections of new tanks from Subsection
9.1.7 by a percentage distribution table containing estimates of the percen-
tage of tanks in each volume and pressure interval based upon the 1977 survey
of VOL storage tanks.27'28 The resulting values, T^, are the number of VOL
tanks in year t, volume interval i, and pressure interval p that are projected
to be subject to regulation.
In conjunction with the baseline conditions of Chapter 3, these values
are then used to estimate the impacted tank population of each regulatory
alternative. The impacted tank population is that portion of the new tank
population in any year that will actually undergo design changes and
experience cost increases under each regulatory alternative. The impacted
tank population for any regulatory alternative, year, and volume interval is
found by summing T." values over appropriate pressure intervals and by scaling
by appropriate baseline assumptions. For example, the summation over vapor
pressures for the volume interval 95 m3 to 115 m3 under Regulatory Alternative I
excludes VOL tanks whose vapor pressures are less than ~ 3.5 kPa because they
are lower than the 3.5-kPa baseline cutoff. In addition, this summation scales
the number of remaining tanks in the volume interval by 0.65 because the base-
line assumes that 35 percent of the new VOL storage tanks in that interval
would be built with internal floating roofs even without Regulatory Alternative
I. The resulting value, T^, is the estimated number of tanks in volume interval
L
i and year t that are impacted by Regulatory Alternative I.
9-39
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TABLE 9-18. INVESTMENT IMPACTS OF REGULATORY ALTERNATIVES FOR
THE MODEL INDEPENDENT TERMINAL AND MODEL PRODUCER/
CONSUMER (10s $1982)
Regulatory Model independent Model producer/
alternatives terminal consumer
Baseline 1,070.0 250.0
I 56.0 15.8
II 56.6 16.0
III 56.6 16.0
IV 71.8 23.2
V 184.8 90.8
9-40
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Table 9-19 shows the tank population impacted by Regulatory Alternative I
as a percent of the projected new VOL storage tank population. Of course, the
actual number of tanks impacted will vary by year. Table 9-20 presents similar
data for Regulatory Alternatives II through V. The percentages are the same
for each of these four regulatory alternatives because they cover the same
volume and pressure ranges and because the baseline conditions assume that
none of these technologies would have otherwise been adopted.
Calculation of T, is therefore based on the number of new storage tanks
projected in Subsection 9.1.7. The projections were developed in the absence of
an NSPS for storage tanks. With higher prices for a product, due, for example
to an NSPS, quantity demanded typically decreases. The decision to treat
demand as constant in any given year is based upon the following analysis.
A pure number called the elasticity of demand can be used to relate
changes in the price of tanks to changes in the quantity of tanks demanded.
More specifically, the elasticity of demand for tanks, n,-r> is the ratio of the
proportionate change in quantity due to a proportionate change in price where
other prices, technology, etc., are held constant.* Alfred Marshall proposed
four determinants of the demand elasticity for any factor of production, such
as VOL storage tanks, within an industry. As modified to reflect a two-factor,
constant-returns-to-scale production technology by Layard and Walters,34 the
price elasticity, ru, of VOL production, consumption, or storage varies
directly with the following:
1. The elasticity of demand (rjy) for VOLs, VOL products, or VOL
storage.
2. The elasticity of substitution, ST Y» between the factor in
question, T, and the other factor, Y. '
3. The share of tanks in the production cost so long as the elasticity
of demand for VOLs, VOL products or VOL storage, n.u» exceeds the
elasticity of substitution of the factors, Sy w-
4. The supply elasticity of the other factor, EW, used to produce VOLs,
VOL products, or VOL storage.
*The elasticity of demand is sometimes referred to as the own-price elasticity
of demand to distinguish it from the influence of other prices and income
changes that can affect demand. It may be defined mathematically as
3T
D P , where Tn is the rate at which tanks are demanded and P is
nT 3P " T the price of tanks.
9-41
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TABLE 9-19. THE NEW TANK POPULATION IMPACTED BY REGULATORY ALTERNATIVE I
AS A PERCENTAGE OF THE PROJECTED NEW TANK POPULATION
Tank
volume
(m3)3
75b to 95
95 to 150
150 to 375
375 to 3,750
3,750 to 15,000
>15,000
Percentage of
Tanks with vapor pressure
between 3.5 and 10.3 kPa
--
—
1.85
2.95
0.46
0.05
new tank population
Tanks with vapor
greater than 10
2.73C
1.47C
0
0
0
0
pressure
.3 kPa
The six volume intervals presented here are aggregates. Calculations
are performed using the corresponding percentages from the 24 volume
intervals of the 1977 survey.27'28
Tanks with volume less that 75 m3 are below the minimum cutoff point con-
sidered for Regulatory Alternative I.
cThe percentages of projected new tank population for tanks with volume
capacities between 75 and 95 m3 and between 95 and 150 m3 are for all
tanks having vapor pressure greater than 3.5 kPa.
9-42
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TABLE 9-20. THE NEW TANK POPULATION IMPACTED BY REGULATORY ALTERNATIVES II-V
AS A PERCENTAGE OF THE PROJECTED NEW TANK POPULATION
Tank Percentage of new tank population
volume Tanks with vapor pressures Tanks with vapor pressures
(m3)3 between 3.5 and 10.3 kPa greater than 10.3 kPa
75b to 95 -- 2.73C
95 to 150
150 to 375
375 to 3,750
3,750 to 15,000
>15,000
—
2.85
4.56
0.71
0.07
2.26"-
2.53d
6.22d
1.19d
0.19d
The six volume intervals presented here are aggregates. Calculations
are performed using the corresponding percentages from the 24 volume
intervals of the 1977 survey.27'28
Tanks with volume less that 75 m3 are below the minimum cutoff point con-
sidered for this Regulatory Alternative I.
The percentages of projected new tank population for tanks with volume
capacities between 75 and 95 m3 and between 95 and 150 m3 are for all
tanks having vapor pressure greater than 3.5 kPa.
The baseline control assumptions specify that tanks with volume greater
than 150 m3 and vapor pressures greater than 76 kPa have vapor control
systems or are pressure 'vessels. Since the upper vapor pressure interval
of the 1977 sample intervals covered all tanks with vapor pressures greater
than 59 kPa, there was no basis in the sample data to distinguish between
tanks in that interval with vapor pressures greater than 76 kPa and those
with vapor pressure less than 76 kPa. A working assumption that all the
tanks in the upper interval had pressures between 59 and 76 kPa was adopted.
Only a small number of tanks was affected by the assumption (0.22 percent
of the total VOL tank population).
9-43
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The lower these factors, the lower n-, and, consequently, the less the quantity
of tanks demanded will adjust to changes in the price of tanks. Each of these
four considerations is discussed below for VOL storage tanks.
First, as suggested by the relatively stable physical output in the face
of rapidly rising prices in the industrial organic chemicals and plastics indus-
tries during the late 1970s (see Tables 9-4 and 9-5), the demand elasticity
for VOLs, as a group, is probably fairly small. The qualifier "as a group" is
important in this context since most substitutes for the VOLs that do have good
substitutes in particular applications are also likely to be VOLs. Storage of
the substitutes would therefore also be subject to the standards.
Second, the elasticity of substitution for bulk VOL storage is very small
because alternative, low-cost means of providing the same service is not read-
ily apparent.* This is especially the case with terminals since storage is
their principal purpose. Most bulk VOL storage tanks either already have been
or, under the regulatory alternatives, are about to be affected by standards
of this type. Therefore, it is not feasible to substitute uncontrolled tanks
for controlled tanks. The cost advantage enjoyed by large tanks (see Chapter 8)
probably will also sharply limit substitution of uncontrolled small-volume tanks
for the large-volume tanks affected by the regulatory alternatives. Finally,
VOL storage service is a crucial part of the production and consumption of VOLs
in that it is nearly a fixed component of a plant design.
Third, the share of VOL storage costs in the production of VOLs or VOL
products is also likely to be small. In the model producer/consumer plant
described in Chapter 6, capital costs for VOL storage comprise between 2 and
11 percent of total capital costs (depending on the regulatory alternative)
and at most just over I percent of total annual capital and operating costs.
However, in the case of VOL storage terminals the share of tank costs in total
costs is likely to be somewhat higher.
Fourth, although the elasticity of supply for other factors used with VOL
storage tanks is more problematic, recent world experience suggests that for
*The elasticity of substitution is a measure of the proportionate change in
the use of different factors of production in response to a proportionate
change in the price ratio of those factors. In effect, it measures the
feasibility and desirability of substituting one factor for another.
There are a number.of different expressions for the elasticity of sub-
stitution, all fairly cumbersome. The interested reader is referred to
Reference 34.
9-44
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at least in one critical input category for VOL producers, that of petroleum
feedstocks, the supply is relatively price inelastic.*
Based upon these considerations, this economic impact analysis adopts the
working assumption that the demand for VOL storage tanks is perfectly inelastic
within the range of relevant tank prices. This demand condition is depicted
in Figure 9-2 as demand curve D. In the event of a rise in the price of tanks
from P to P1, the demand for tanks and, hence, the number of impacted VOL stor-
age tanks will remain unchanged at the rate T, per year. This characterization
of tank demand is recognized to be extreme in the sense that, as noted above,
one usually observes at least some reduction in demand in response to price
increases for most commodities. However, there are no publicly available data
on the prices and quantities of VOL storage tanks that can be used to estimate
the elasticity of demand for storage tanks. Furthermore, if demand is treated
as perfectly inelastic, the likely direction of any error associated with this
assumption is known. That is, the impact of each of the regulatory alternatives
on the cost of VOL storage is overestimated since if any nonzero elasticity
of demand is used fewer new tanks would be projected and subject to the standards
and additional cost.
As illustrated by demand schedule Dp in Figure 9-2, the economic analysis
allows for economic growth by specifying a shift in the demand for VOL storage
tanks over time. As the economy grows, there will be some growth in the
demand for VOL chemicals and, hence, for new and replacement VOL storage tanks.
The magnitude of this growth between periods t and t+1 is reflected in the
demand curves for the respective periods and the difference T?+, - T? . The 5
percent growth rate in new tank capacity demand and the tank replacement
schedule, adopted for the projections in Section 9.1, are also adopted as the
quantitative basis for these shifts in demand.
As discussed above, data on the impacted VOL tank population for each
regulatory alternative, year, pressure interval and volume interval determine
the value of T^ in Figure 9-2. The regression equations of cost against volume
estimated in Chapter 8 for each regulatory alternative are then used to deter-
*The elasticity of supply is defined analogously to the elasticity of demand:
the ratio of a proportionate change in the quantity supplied to a proportionate
change in the supply price. For a discussion see Reference 35.
9-45
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mine the change in the price of a tank in that volume interval, P1 - P.*
Multiplying T^ by P1 - P gives an estimate of the area P'abP in Figure 9-2.
\f
This is the estimated investment impact, in 1982 dollars, of the particular
regulatory alternative in question on tanks in the given volume interval in
the year t. These values are then summed over all the volume intervals to
obtain the nationwide investment impact of the regulatory alternative in year
t. Finally, annual investment values for the years 1984-1988 are summed to
obtain an estimate of the cummulative nationwide investment impact for the
projection period.
Table 9-21 presents the resulting data on nationwide investment impacts
for each regulatory alternative using this methodology. For comparison, the
estimated investment in new VOL tanks covered by the baseline conditions (>75
m3 and >3.5 KPa) exclusive of vapor recovery equipment or pressure vessel
costs is also included. The investment impacts for Regulatory Alternatives II
and III are the same because they are estimated in Chapter 8 to have the same
impact on the cost of a tank.
9.2.3 Nationwide Annualized Cost Impacts
The total annual cost of each of the regulatory alternatives is dependent
on the number of new tanks put in place over the five year period and the
change in the annualized cost of each tank. The annualized cost represents
the annual financial obligations imposed by the regulatory alternative on pur-
chasers of VOL storage tanks. In particular, fifth-year costs include payments
related to the regulatory alternatives in the fifth year for debt and operating
expenses associated with tanks purchased in each of the 4 previous years as
well as those expenses newly incurred due to tank purchases in the fifth year.
These costs, in constant 1982 dollars, are presented in the second column of
Table 9-22. They range from 3.3 million dollars for Regulatory Alternative I
to just over 26 million dollars for Regulatory Alternative V.
*The change in price in this analysis is equivalent to a change in cost since
tank fabricators will not contract to build new tanks unless their costs are
covered by the price (see subsection 9.2.1 above). For those regression
equations expressed in terms of diameter, an equivalent volumetric relation-
ship was derived using a correspondence between diameter and height suggested
by Reference 36. The change in the cost or price for any volume interval is
estimated by using the mid-point of that interval in the regression equation.
For the interval that is unboundered (>15,000 m3), a volume of 20,000 m3 was
used.
9-46
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TABLE 9-21. ADDITIONAL NATIONWIDE INVESTMENT IN VOL STORAGE
REQUIRED BY THE REGULATORY ALTERNATIVES, 1984-1988
Estimated
investment
under baseline
assumptions '
Additional .
nationwide investment
($106, constant 1982 dollars)
Year
1S84
1985
1986
1987
1988
1984-1988
($106, constant
1982 dollars)
41.94
43.86
44.31
45.92
52.04
224.57
I
2.70
2.87
2.93
3.07
3.39
14.84
II & III
2.75
2.93
2.99
3.14
3.46
15.16
IV
4.70
4.96
5.04
5.27
5.86
25.54
V
21.67
22.69
22.97
23.84
26.84
116.13
an estimate of the nationwide investment that would be made in new tanks
with volumes > 75 m3 containing liquids with vapor pressures > 3.5 kPa
without implementation of any of the regulatory alternatives. This estimate
is exclusive of any investment in vapor recovery equipment or pressure
vessels.
Annual values are not dicounted to the present.
9-47
-------
TABLE 9-22. FIFTH-YEAR NATIONWIDE ANNUALIZED COST OF
THE REGULATORY ALTERNATIVES
Regulatory
alternative
I
II
III
IV
' V
Without
emission
savings
credit
3.25
3.34
3.34
6.11
26.14
Fifth-year annual i zed cost
($106, constant 1982 dollars)
With
emission
savings
credit
-0.56
-0.67
-1.01
1.68
21.61
aCredit computed using a VOL price of $460/Mg.
9-48
-------
As discussed above, the tanks impacted by the regulatory alternatives
will also generate some additional economic benefits for tank users because
they reduce vaporization of valuable VOLs. The tank owners are better off by
the amount of emissions reductions times the value of the chemical saved.
Nationwide emissions reductions for each regulatory alternative in the fifth
year after promulgation are estimated in Chapter 7. The $460/Mg estimate of
the value of VOL was applied to these emissions reductions to obtain an
estimate of the nationwide economic benefit of this emissions reduction to VOL
tank users in 1988. The resulting emission savings credit was then applied
against annualized costs; the results are shown in column 3 of Table 9-22. On
a nationwide basis, the first three regulatory alternatives produce net eco-
nomic benefits in 1988 when an emission savings credit is included in the cal-
culation. The fact that the nationwide annual costs are negative is not incon-
sistent with the finding of positive costs of these alternatives for the two
model plants since the model plants were selected so as to exhibit a greater
than average economic impact.
9.3 REGULATORY, INFLATIONARY, SOCIOECONOMIC, AND SMALL-BUSINESS IMPACTS
9.3.1 Executive Order 12291
Executive Order 12291 requires the conduct of a regulatory impact analy-
sis (RIA) of a proposed regulation if the regulation is likely to result in
1. An annual effect on the economy of $100 million or more.
2. A major cost or price increase for consumers; individual industries;
Federal, State, or local government agencies; or geographic regions.
3. Significant adverse effects on competition, employment, investment,
productivity, innovation, or ability of United States-based enter-
prises to compete with foreign-based enterprises in domestic or
foreign markets.
Estimated nationwide investment impacts on tank purchases listed in Table
9-21 show that, for all years from 1983 through 1988 and all regulatory alterna-
tives, the investment impact would be substantially less than $100 million per
year. When the capital costs associated with the regulatory alternatives are
annualized and credit is given for reduction in VOL vaporization, it is esti-
mated that the first three regulatory alternatives actually generate nation-
wide cost savings in 1988 (see Table 9-22). Regulatory Alternatives IV and V
show nationwide annualized cost increases after credit for emission savings of
9-49
-------
$1.61 x 10 and $21.61 x 10 , respectively. These are very small figures
compared to the investment and sales levels of VOL storing industries.
Percentage price increases for the model terminal are higher than those
for a model producer/consumer but were still less than 5 percent for Regulatory
Alternatives I through IV after emission savings credits. Regulatory Alterna-
tive V was estimated to increase the price of storage at the model terminal by
13.2 percent without an emissions reduction credit and by 11.8 percent with
such a credit.
Based on these results, the proposed standards do not qualify as major
regulatory alternatives under the criteria enumerated above: the annual
effect on the economy is substantially less than $100 x 106, the price impacts
are small, and the standard will not have a significant effect on the opera-
tion of the domestic economy or its international trade. Therefore, a regula-
tory impact analysis and associated benefit/cost calculations need not be per-
formed. While this is the case, it is still worthwhile to note, in a qualita-
tive fashion, the benefits against which the costs discussed above should be
balanced.
The standards will reduce the rate of emission of VOLs to the atmosphere.
These compounds are precursors of photochemical oxidants, particularly ozone.
The EPA publication Air Quality Criteria for Ozone and Other Photochemical
37
Oxidants explains the effects of exposure to elevated ambient concentrations
of oxidants. (The problem of ozone depletion of the upper atmosphere and its
relation to this standard are not addressed here.) These effects include
1. Human health effects. Ozone exposure has been shown to cause
increased rates of respiratory symptoms such as coughing,
wheezing, sneezing, and short-breath; increased rates of head-
ache, eye-irritation and throat irritation; and increases in
the number of red blood cells. One experiment links ozone
exposure to damage to human chromosomes.
2. Vegetation effects. Reduced crop yields as a result of damges
to leaves and/or plants have been shown for several crops
including citrus, grapes, and cotton. The reduction in crop
yields was shown to be linked to the level of duration of ozone
exposure.
3. Materials effects. Ozone exposure has been shown to accelerate
the deterioration of organic materials such as plastics and
rubber (elastomers), textile dyes, fibers, and certain paints
and coatings.
9-50
-------
4. Ecosystem effects. Continued ozone expoure has been shown to
be linked to the disappearance of trees such as Ponderosa and
Jeffrey Pines and death of predominant vegetation. Hence con-
tinued ozone exposure places a stress on the ecosystem.
In addition to reducing the severity of the physical and biological effects
enumerated above, the regulatory action is likely to improve the aesthetic and
economic value of the environment through, for example, beautification of natural
and undeveloped land because of increased vegetation, improved visibility, and
reduced incidence of noxious odors.
9.3.2 The Regulatory Flexibility Act
The Regulatory Flexibility Act requires the conduct of a regulatory flex-
ibility analysis (RFA) if a substantial number of small firms are significantly
adversely impacted by the regulatory alternatives examined. In Chapter 6, the
model independent terminal and model producer/consumer were identified as small
facilities. The economic impact of regulatory alternatives on these facilities
was not found to be significant.
9.4 REFERENCES
1. Scherer, P.M. Industrial Market Structure and Economic Performance.
Chicago, Rand McNally College Publishing Company, 1980.
2. Hegman, George B. In: World Outlook for Petrochemicals. Cambridge,
Arthur D. Little, Inc., August 1978. p. 7.
3. U.S. Department of Commerce, Bureau of the Census. 1977 Census of Manu-
factures. Part 2, SIC Major Groups 27-34. U.S. Government Printing
Office. Washington, DC. 1981. p. 28F-13.
4. Booz, Allen, and Hamilton, Inc. Cost of Hydrocarbon Emissions Control to
the U.S. Chemical Industry (SIC 28). Exhibit VI-6. Florham Park, NJ.
December 1977.
5. U.S. Department of Commerce, Bureau of Economic Analysis. 1972 Input-
Output Tables: Structure of the U.S. Economy. U.S. Government Printing
Office. Washington, DC.
6. U.S. Department of Commerce, Bureau of the Census. 1972 Census of Manu-
factures. Volume 11, Industrial Statistics, Part 2, SIC Major Group 27-34.
U.S. Government Printing Office. Washington, DC. p. 28F-13-28F-15.
August 1976.
7. Memorandum from Hart, Marge, National Association of Chemical Distribu-
tors, to Rockstroh, Margie, TRW, Inc. 1980.
8. Independent Liquid Terminals Association. 1982 Bulk Liquid Terminals
Directory, 7th Edition. Washington, DC. 1982. 99 p.
9. Reference 3, p. 28F-5, 28B-5.
10. Fallwell, William F. Chemical Capital Spending to Turn up in 1979.
Chemical and Engineering News. 56:10-12. December 11, 1978.
9-51
-------
11. U.S. Department of Commerce, Bureau of the Census. Business Statistics,
1977. U.S. Government Printing Office. Washington, DC. 1979. p. 46.
12. Reference 6, p. 28F-5, 28B-5.
13. Operating Rate. Chemical and Engineering News. 515:59. June 11, 1979.
14. U.S. International Trade Commission. U.S. Production and Sales—Synthetic
Organic Chemicals (for the years 1955 through 1981). Table 1. U.S.
Government Printing Office. Washington, DC.
15. U.S. Department of Commerce, Bureau of Industrial Economics. 1982 U.S.
Industrial Outlook. U.S. Government Printing Office. Washington, DC.
January 1982. p. 102-103.
16. Reference 15, p. 120, 141, 316.
17. Radian Corporation. Organic Chemical Producers Data Base, 1976.
Research Triangle Park, NC. Contract No. 68-02-2623. 1978.
18. Reference 6, p. 28F-8, 28F-9.
19. Reference 3, p. 28F-7, 28F-8.
20. Reference 6, p. 28B-7, 28B-8.
21. Reference 3, p. 28B-8, 28B-9.
22. U.S. Department of Labor, Bureau of Labor Statistics. Producer Prices
and Price Indexes. Supplements 1978-1982 (data for 1977 to 1981). U.S.
Government Printing Office. Washington, DC.
23. U.S. Environmental Protection Agency. VOC Fugitive Emissions in Synthetic
Organic Chemicals Manufacturing Industry-Background Information for
Proposed Standards. Research Triangle Park, NC. EPA-450/3-80-033a.
November 1980. p. 9-1-9-36, E-l-E-11.
24. U.S. Environmental Protection Agency. Fugitive Emission Sources of
Organic Compounts—Additional Information on Emissions, Emission
Reductions, and Costs. Research Triangle Park, NC. EPA-450/3-82-010.
April 1S82. p. A-l-A-23.
25. Federal Reserve Statistical Release Industrial Production, G.12.3. Board
of Governors of the Federal Reserve System. Washington, DC. 1954-1977
(monthly).
26. Predicasts, Inc. Predicasts Basebook. Cleveland, OH. 1960-1980.
27. Hydroscience, Inc. Emissions Control Options for the Synthetic Organic
Chemicals Manufacturing Industry: Storage Handling Report. Knoxville,
TN. March 1979.
28. Letter from Rockstroh, M.A., TRW, Inc., to Smith, V., RTI. July 10,
1980.
29. Telecon. Anderson, Don, RTI, with Greek, Bruce, American Chemical
Society. October 29, 1982.
30. Telecon. Anderson, Don, RTI, with Pfann, Harry, Department of Commerce.
October 29, 1982.
31. Letter from Rockstroh, M.A., TRW, to Moody, W.T., TRW. February 1, 1980.
32. Radian, Inc. The Revised Organic Chemical Producers Data Base System,
Final Interim Report. Austin, Texas. EPA Contract No. 68-03-2623.
March 1979.
9-52
-------
33. Letter from Shumaker, J. , TRW, to Morn's, G.E., RTI. January 3, 1983.
34. Layard, P.R.G., and A.A. Walters. Microeconomic Theory. New York,
McGraw-Hill Book Company, 1978. p. 260-270.
35. Reference 33, p. 221-230.
36. Memorandum from Moody, W.T., TRW, to Morris, G.E., RTI, December 17,
1982.
37. Air Quality Criteria for Ozone and other Photochemical oxidants. U.S.
Environmental Protection Agency. Publication No. EPA-600/8-78-004.
April 1978.
9-53
-------
APPENDIX A - EVOLUTION OF
THE BACKGROUND INFORMATION DOCUMENT
-------
Al. Literature Review
November 1978
November 22, 1978
December 1979
January 1980
January 1980
January 1980
January 1980
January 1980
January 1980
January 1980
Hydroscience Inc. Emission Control Options for
the Synthetic Organic Chemicals Industry -
Storage and Handling Report, October, 1979.
Letter with attached report from Kern, R. C.
November 22, 1978, Ultraflote, to R. K. Burr,
EPArCPB, Hydrocarbon Emission Loss Measurements
on a 20 Foot Diameter Pilot Test Tank with an
Ultraflote and a CBI Weathermaster Internal
Floating Roof.
Letter and attachment from Lee, B. , Radian
Corporation, to Moody, W. T. , TRW.'EED.
November 30, 1979. Letter transmitting
updated version of the report generated August
1978 from the Organic Chemical Producers Data
Base.
Evaporation Loss in the Petroleum Industry -
Causes and Control, Evaporation Loss Committee,
American Petroleum Institute, February 1959.
Evaporation Loss from Floating-Roof Tanks,
Evaporation Loss Committee, American Petroleum
Institute, February 1962.
Petrochemical Evaporation Loss from Storage
Tanks, Division of Refining, American Petroleum
Institute, November 1969.
Venting Atmospheric and Low-Pressure Tank
(Nonrefrigerated and Refrigerated), Refining
Department, American Petroleum Institute,
December 1973.
Use of Internal Covers and Covered Floating
Roofs to Reduce Evaporation Loss, American
Petroleum Institute, 1976.
Measurement and Determination of Hydrocarbon
Emissions in the Course of Storage and Transfer
in Above-Ground Fixed Cover Tanks With and
Without Floating Covers, BMI-DGMK Projects
4590-10 and 4590-11, Translated for EPA by
Literature Research Company, 1976.
Hydrocarbon Emissions from Floating Roof
Petroleum Tanks, Western Oil and Gas
Association, January 1977.
A-2
-------
January 1980
February 1980
February 1980
February 1980
February 1980
April 1980
March 1980
June 1980
June 1980
June 1980
June 1980
Cost of Hydrocarbon Emissions Control to the
U.S. Chemical Industry (SIC 28), Volumes I and
II, Manufacturing Chemists Association,
December 1977.
Control of Volatile Organic Emissions from
Storage of Petroleum Liquids in Fixed-Roof
Tanks, EPA-450/2-77-036, EPA-.CPB, December
1977.
Evaluation of Hydrocarbon Emissions from
Petroleum Liquid Storage, EPA-450/3-78-012,
R. K. Burr, EPA:CPB, March 1978.
Suggested Emission Factors for Fixed-Roof
Storage Tanks, A. L. Wilson, Engineering-
Science, Inc., November 13, 1978.
Control of Volatile Organic Emissions from
Petroleum Liquid Storage in External Floating
Roof Tanks, EPA-450/2-78-047, EPA:CPB,
December 1978.
The Revised Organic Chemical Producers Data
Base System, EPA Contract No. 68-02-2623
(Radian Corporation), A. Jefcoat, EPA:IERL,
March 31, 1979.
Comments on the "BMI-DGMK" Report, J. Zabaga,
Mobile Oil Company, June 16, 1978.
Bulk Liquid Terminals and Storage Facilities,
Independent Liquid Terminals Association, 1979
(Directory).
Emissions Control Options for the Synthetic
Organic Chemicals Manufacturing Industry,
Thermal Oxidation, (Draft), EPA Contract
No. 68-02-2577, EPA:ESED, December 1979.
Emissions Control Options for the Synthetic
Organic Chemicals Manufacturing Industry,
Carbon Adsorption (Draft), EPA Contract
No. 68-02-2577, EPA:ESED, February 1980.
Emissions Control Options for the Synthetic
Organic Chemicals Manufacturing Industry,
Thermal Oxidation Supplement (Draft), EPA
Contract No. 68-02-2577, EPA:ESED, February 1980.
A-3
-------
A2. Information from Other Sources
January 1979
April 1979
September 1979
October 1979
December 1979
December 1979
March 1980
March 1980
March 1980
April 1980
H. F. Ellenburg, Instrumentation Products Co.,
to L. Hayes, TRW:EED, December 20, 1978, Letter
with enclosed information on vapor recovery
systems for storage tanks and solvent transfer
facilities.
T. W. Mix, Merix Corporation to R. K. Burr,
EPArCPB, April 21, 1979, Letter with enclosed
summary print-out of input and output losses of
above-ground gasoline tanks on farms.
B. Lee, Radian Corporation, to W. T. Moody,
TRW:EED, August 31, 1979, Letter with enclosed
information from the Organic Chemical Producers
Data Base.
J. K. Walters, American Petroleum Institute, to
R. K. Burr, EPA.-CPB, September 14, 1979, Letter
with enclosed technical comments of the American
Petroleum Institute on the draft report
"Measurement of Benzene Emissions from a
Floating Roof Test Tank."
M. Rutland, GATX, to R. Guidetti, TRW:EED,
December 3, 1979, Letter concerning budgetary
prices for standard API-650 Cone Roof Tanks
and Floating Roof Tanks.
E. B. Dees, TRW:EED, to M. R. Frega, Frega
Associates, Inc., December 6, 1979, Letter
requesting information to be used in an industry
profile for volatile organic liquids storage.
H. Reiss, Altech Industries, Inc., to G. May,
TRW:EED, February 26, 1980, Letter with
summarized budget price information.
T. P. Tremblay, Chicago Bridge & Iron Company,
to W. T. Moody, TRW:EED, February 27, 1980,
Letter concerning price differentials
Weathermaster Floating Roof Tank versus cone
roof tank-revision 1.0.
T. T. Fung, Systems Division, to M. A. Rockstroh,
TRW:EED, March 14, 1980, Letter concerning
acetone storage tank emissions control study.
J. J. Dechant, Brown Boiler & Tank Works, 'Ltd.,
to TRW:EED, March 27, 1980, Letter concerning
quotation with budget figures in order to erect
acetone storage tanks.
A-4
-------
May 1980
May 1980
June 1980
June 1980
June 1980
June 1980
July 1980
July 1980
October 1982 to
December 1982
January 1983
J. R. Farmer, EPA:CPB, to R. L. Stuart,
Monsanto Company, April 28, 1980, Letter
with enclosed background information to
support the volatile organic liquids regulation
with attached list of addressees.
Comments on the Volatile Organic Liquids
Background Information, H. D. Kerfman,GATX,
May 1980.
L. P. Hughes, Mobay Chemical Corporation,
to W. T. Moody, TRWrEED, May 29, 1980,
Letter with enclosed responses regarding
possible tank emission recovery systems.
Dr. F. S. Lisella, Department of Health and
Human Services, to J. R. Farmer, EPA:CPB,
June 2, 1980, Letter commenting on the
draft copy of Volatile Organic Compound
Emissions from Volatile Organic Liquid
Storage Tanks.
R. E. Kinghorn, R.F.I. Services Corp., to
W. T. Moody, TRW:EED, June 9, 1980, Letter
concerning prices for conventional cone
roof tanks constructed to API 650 code.
T. P. Tremblay, Chicago Bridge & Iron Company,
to W. T. Moody, TRW:EED, June 22, 1980,
Letter concerning price differentials
Weathermaster Floating Roof Tank versus
cone roof tank.
R. Harrison, Western Oil and Gas Association,
to J. R. Farmer, EPA-.ESED, June 27, 1980,
Letter commenting on the draft document
"Volatile Organic Compound Emissions from
Volatile Organic Liquids Storage Tanks."
J. K. Walters, American Petroleum Institute,
to J. R. Farmer, EPArESED, June 30, 1980,
Letter commenting on the draft document
"Volatile Organic Compound Emissions from
Volatile Organic Liquids Storage Tanks."
Updated costs of control equipment obtained
from 15 vendors.
W. F. O'Keefe, American Petroleum Institute
(API) to S. R. wyatt, EPArESED, Letter
concerning emissions calculations (including
final API Bulletin 2519 evaporation loss
from internal floating roof tanks).
A-5
-------
A3. Emission Source Measurement
May 1979
June 1979
August 1979
March 1982
Emission Measurements on a Floating Roof
Pilot Test Tank, R. J. Laverman, Chicago
Bridge & Iron Company, May 16, 1979.
Measurement of Benzene Emissions from a
Floating Roof Test Tank, EPA-450/3-79-020,
R. K. Burr, EPA:CPB, June 1979.
Hydrocarbon Emission Measurements of Crude
Oil on the 20 Foot Diameter Floating Roof
Pilot Test Tank, R. J. Laverman, Chicago
Bridge & Iron Company, August 15, 1978.
Testing Program to Measure Hydrocarbon
Emissions From A Controlled Internal Floating
Roof Tank, for American Petroleum Institute
Committee on Evaporative Loss Measurement
Task Group 2519, R. J. Laverman, T. J. Haynie,
and J. F. Newbury, Chicago Bridge & Iron
Company, March 1982.
A-6
-------
A4. Plant and Other Related Trips
November 14-17, 1978
November 15, 1978
November 15, 1978
August 14, 1980
August 20, 1980
August 21, 1980
August 26, 1980
Trip to Hydroscience Inc., to discuss data
base and Phase I report.
Trip to Exxon Chemicals, Baton Rouge, Louisiana,
to obtain information on the rail car loading
facility.
Trip to Gilmore Maxine Services, Baton Rouge,
Louisiana, to inspect a barge cleaning facility.
Trip to Conoco Chemical, Baltimore, Maryland, to
inspect a vapor recovery system.
Trip to Vulcan Materials, Geismar, Louisiana, to
inspect a vapor recovery system.
Trip to Amoco Chemical, Texas City, Texas, to
inspect a vapor recovery system.
Trip to Dow Chemical, Midland, Michigan, to
inspect two vapor recovery systems.
A-7
-------
A5. Meetings with Industry
March 20, 1979
August 9, 1979
September 2, 1982
December 15, 1982
January 26, 1983
Meeting with Dow Chemical Corporation to
discuss small vessel (=20,000 gallon)
control techniques and industry trends.
Meeting with the Chemical Manufacturers
Association to discuss the regulatory
approach and control technologies.
Meeting with the American Petroleum Institute
to discuss 1) the analytical approach used
by API in developing storage vessel emission
factors for the Bulletin 2519 "Evaporative
Loss from Internal Floating Roof Tanks";
2) the EPA approach for emission factors
development; and 3) the effect of roof
configuration upon emissions.
Meeting with the American Petroleum Institute
to discuss EPA study and review of internal
floating roof vessel emissions and the API
testing program.
Meeting with the American Petroleum
Institute (API) to discuss the new API
testing preliminary data available on
floating roof vessel emissions.
A-8
-------
A6. Reports and Review Process
December 14, 1978
January 29, 1979
March 14, 1979
August 1979
November 29, 1979
January 18, 1980
March 26, 1980
June 20, 1980
October 1980
December 3, 1980
December 1980
April 2, 1981
October 1981
March 1983
J. L. Shumaker, EPA:CPB, to V. Smith, Research
Triangle Institute, Letter concerning the
finalization of SQCMI to be used in all
generic standards.
E. C. Pulaski, TRW-.EED, to V. Smith, Research
Triangle Institute, Letter with enclosed
model facilities for synthetic organic
chemical storage facilities.
R. C. Weber, EPA:CPB, to E. Pulaski, TRW:EED,
Letter confirming deletion of Handling
portion or SOCMI Storage and Handling NSPS.
Decision to expand SOCMI storage to VOL.
W. T. Moody, TRWrEED, to the Volatile Organic
Liquids Docket Files, Memo with an attached
selection of Model Facilities.
W. T. Moody, TRW:EED, to the Volatile Organic
Liquids Docket Files, Memo concerning tanks
involved in industrial organics.
Model Plants and Regulatory Alternatives are
finalized.
Decision on the basis of the standard.
Working Group Review.
National Air Pollution Control Techniques
Advisory Committee Meeting.
Steering Committee Review.
Assistant Administrator Review.
Package withdrawn from review process and
returned to OAQPS.
Steering Committee review of the revised
standard based upon newly available emissions
information.
A-9
-------
APPENDIX B - INDEX TO ENVIRONMENTAL IMPACT CONSIDERATIONS
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cNVIRONMENTAT
PROTECTION
AGENCY
DALLAS, TEXAS
LIBRARY
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TECHNICAL REPORT DATA
REPORT NO. 2.
EPA-450/3-81-003a
TITLE AND SUBTITLE
VOC Emissions from Volatile Organic Liquid Storage
Tanks - Background Information for Proposed Standards
AUTHOR(S)
PERFORMING ORGANIZATION NAME AND ADDRESS
Office of Air Quality Planning and Standards
Environmental Protection Agency
Research Triangle Park, North Carolina 27711
. SPONSORING AGENCY NAME AND ADDRESS
DAA for Air Quality Planning and Standards
Office of Air, Noise, and Radiation
U.S. Environmental Protection Agency
Research Triangle Park, North Carolina 27711
3 RECIPIENT'S ACCESSION NO.^f*
5 REPORT DATE t *. \ ', AC
6 PERFORMING ORGANIZATICM-Cj
•VsP'
Bv'CY
, TEXAS
tfflnr
8. PERFORMING ORGANIZATION REPORT NO
10. PROGRAM ELEMENT NO.
11. CONTRACT/GRANT NO.
68-02-3063
13. TYPE OF REPORT AND PERIOD
Draft
COVERED
14. SPONSORING AGENCY CODE
EPA/200/04
. SUPPLEMENTARY NOTES
.ABSTRACT
Standards of Performance for the control of VOC emissions from Volatile Organic
Liquid (VOL) storage tanks are being proposed under the authority of Section 111
of the Clean Air Act. These standards would apply to all new and'existing storage
tanks having a capacity of 75 cubic meters or larger, which are to be used for the
storage of VOL. This document contains background information and environmental
and economic impact assessments of the regulatory alternatives considered in
developing the proposed standards.
KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
ir pollution Equipment standard
Dilution control Standards of Performance
torage tanks
Dntact floating roofs
lemical manufacturing plants
Dlatile Organic Compounds
Dlatile Organic Liquids
jlk Liquid Terminals
DISTRIBUTION STATEMENT
Unlimited
b.lDENTIFIERS/OPEN ENDED TERMS
Air Pollution Control
19. SECURITY CLASS (This Report)
Unclassified
20 SECURITY CLASS (This page)
Unclassified
r. COSATI Field/Group
13 B
21 NO. OF PAGES
199
22. PRICE
A Form 2270-1 (Rev. 4-77) PREVIOUS EDITION i s OBSOLETE
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