. ซ.••• •.•::•••••<:••:•: i-:VV-' ->^ •;;^.V- ;•;-:-;;;>;;•:. •.:-:::-:.;-V " ..::^' ...•:.:, :KV.....:.V.V.. ..:-:::.::!' .:'..•.....-,' >'• •^.-••;:..Sa*;:- ^' S:;v::;.:::::m- ,•.•:•••'•.- . ' • • . • ,-, fE,?^.:;^:.^ Lifetlm* (n. years) • " •- •• '- ' '-'• :^ •••••• -• • ...,..-... ......K...-t..,......-....y.:.-.. fl jg ..'.,. . .,,...;, , :s?A-:?:'::;?v-;. .I...:-:.:-.....: .::;:.,..::.. .,.'.•' ', .;.-.•.-. •.•.• :*i6 ^.y,,,. .:.:::•::,.;••. •$•.!•>?• .: , , , ': :•:•; -• Cash Flow Estimate (C.aj) • , ;;-•-', ;,:;:;.';'V,::;;; - ........................................ iJiP-iis? :^';f:;;J;:|:;:v:-: ..,,,,,,,,;,,.-;,,,, : ..:;•..:•:•:...:• •.•.•ป:...>:.:v:.:.. :''•;?.':'.. '"'•!:'':'::;:''''.';:' vS^-'Sii :;'vs;:.:-:.;3||| Will " • ANNUAL3ZED CASH FLOW. rปS% a - • •! - .;;...;.; . '::;;l%:::'l'v:h .•;&;'. : .;:: -.•ซ:;.:.• ., ,:. "'v^Yvi. ':v;';":. ...•-:•.:•..••. .'•-: ,- ....•.-.•••• -• .• ":&a >ซ ^ ' rd= 10% •I--*:.'-,::;::-:----' %'-:|:v ::.••• -.v"^': 'W.r ;".::••:ซ• ^•^rk".^:: :•...: ,..:v;... 1 '••• ..';---.;-?.-k-i:.-. ..,.., ,,,, . rdซ1S% • . ....•.;.;....•.....•<....;• iEi! '^••:'->'" 'iv::.?^'";:'??:'- ''i?.::.".:^:',;:. ,::•:. _ ;•.'•'•••>'•;•?•.;• '::]:;:.:.' "W'l W.":v^.:, rd* .:::.:.:.y.V-.;-. '•'-:•:.ฃ.•"'• tft- ...x.;.:.;.:...^..... ill. •I *m?w lyiiiJai, ••:•:.::•..•.•.•.••. 1P/T .sfe;. '' ' A I — ' ' * '' In thousands of year-0 dollars
-------
    Worksheet I
Tier 1  • Hidden Costs
D Current Practice

D Alternative Practic

D Incremental
ITEM DESCRIPTION 	 "

A. DEPRECIABLE CAPITAL
EXPENDITURES
Al Monitoring Equipment
A2 Preparedness and Protective
Equipment
• A3 Additional Technology
A4 Other
B. EXPENSES
Bl Notification
BZ Reporting
B3 Monitoring/Testing
.. . ..-.-.• ••.-.]. •..• .-• ; •••" ฃ??•;>:•.;
B4 Recordkeeping , ,. ''"^.','7t^
B5 Planning/Studies/Modeling
B6 Training,/' .••.- ' ••;•?. , "v'.;.> .••.
B7 Inspections
B8 Manifesting ; •; -•..•."-. -K;
B9 Labeling
BIO Preparedness and
Protective Equipment ;
Bll Closure/Post Closure Care
B12 Medical Surveillance
B13 Insurance/Special Taxes
B14 Other.-"; V^ , :A v, -i fiiC^S






"\ CASH FLOW INFORMATION
Escalation
Rat*

-,.- .... •-.




, . .•-•. -. 	 •••'•'.':•.
First Year
of Cath Flow
(tr yปarป)

• •.'

;;;;;;;•: ..;;./;vj;?o;|.;,,
,....,.,..,, ...

^.•:.:0:v;j:,;::-S'
.:.•;.;•.::•; •-•.••.,^,:.

Llfatltrw
(n, years)
•


••;';'•'• .' ' vf:T.
• ::ซ.,. :.•"•":,:
,,,.'.,. ".<•;',-:

Cash Flow
Estlmat*
(C.aj)



..... ....... v,.,.
,:..,'.,„.., .".,:.,:.:





-
"ANNUAUZED CASH FLOW-2
rซS%



:•-:;:•• •••

rd= 10*



&%,:' ••'.
"^Fv .'
rf 15<*



.. -: '" ^""
•g:,^i
rde
-
it

S'i'y*!-' :'--'<:->'
;:'T.'.':-T '•'• r.;;
._;;.;!';•:-;;>-:.•
v^:"'^;!:
'^^.
;:ii^
^ In thousands of year-0 dollars

-------
     Worksheet II
Tier 2 • Liability Costs
ITEM .DESCRIPTION \ ,
-
A.
B.
BI
B2
B3
B4
PENALITIES AND FINES
FUTURE LIABILITIES
Treatment or Storage. in Tanks •
Transportation
, Disposal in Landfills
Other

a| ' '
— ' In thousands of year-0 dollars
- -: - CASH "FLOW INFORMATION

Escalation
Rate
(r , %)
ซ


/'.iifeSt
First Year
of Cash Flow
(t , years)



Lifetime
(n, years)
... ^ •;:_ :*.

ifcl
Cash Flow
Estimate
(C.aj)
; .

."•-.. ••-..-;4.?.
O Current Practice

D Alternative Pract
D Increments)
, ANNUAUZED CASH FLOW

rซ5%
d
.:..:;p:.-:,,x. ...

||ง.:-:.;::
r • ซ 10%
, a


;>x.:.;:v--:: ::;:
f ' ซ 15%
a


;.:},:'
rdV


'•V-;.::.

-------
     Worksheet II
Tier 2 • Liability Costs
ITEM rOESCTIPTlON^

A.
B.
BI
B2
B3
B4
PENALITIES AND FINES
FUTURE LIABILITIES
"Treatment or Storage, in Tanks
Transportation
Disposal in Landfills
Other

•^ In thousands of year-0 dollars
CASH FLOW INFORMATION

Escalation
Rat*
(V %)


-
First Yปar
of Cach Flow
(t , yaars)



Llfatlnw
(n, year*)
•; . •••'

^
Cash Flow
Estlmata
(C.aj)


. .. •;':<-;;
I I Current Practice

O  Alternative Practic

CH  Incremental
-ANNUAUZED'CASH FLOW-

r ป 5%
d
;' • v

';;ฃ::••,:;:.;;:
r = 10V.
d


•••'•'••*• ' '
rd*



'„-
•''.' "

*> ;•••

-------
ITEM DESCRIPTION

A.,
B.
ADJUSTMENT TO
EXPENSES
ADJUSTMENT TO
OPERATING REVENUES
                         Worksheet HI
                  Tier 3 'Less Tangible Costs
' *' CASH FLOW INFORMATION - - :

Escalation
•Rat*
 , , \- [, . , ^
Consumer Acceptance
• ... n::'.. QI
YES. NO:::
-( f *
Justification (Please./ustifyJ

' - • .-•• " ' •-•''••• • , • •
.• • - • , "-? '. '
i . .,
• , . ..:r..-.;;:::>;;:.r ;•; ?-m ;;; :%f::si:;:W;S:;;JUstification (Please justify) ' -"
Employee/ Union Relations:^
r .....;-, 	 ••; . :..;.,... , '. ...•.•v.,,>'..,ss;:
••.:;•;• .'•'^^^n^Ov
'•'• ' ' ' ' •'•. '>'-S YES" C;; NOซ:.
',•./'.; 'v":'--'-^;^----:;-V.:"':-:v-
. , Corporate Jmage.ss;
•::-:"".-i:fiSini;
;;,' ';;.;.• •;_;:YEs:v;';Nb.^
'
' ' '. '• : ' ."•.••'.'. ' • -:; ( '-•'..
- . ' ,.' " '-- .'.-.- "
. ' ' -- '• ' ' • ' ' •-.'..'
Justification (Please justify) •
\ .-• . • -

':'*:' ' . ,



-------
                                   Worksheet 111
                           Tier 3 • Less Tangible Costs

ITEM DESCRIPTION

•
A.
B.
ADJUSTMENT TO
EXPENSES

ADJUSTMENT TO
OPERATING REVENUES
'- CASH FLOW INFORMATION
Escalation
Raw
(r . */•)


First Yaar
of Caen Flow
(t yaars)


Lltatlm*
(n, yซarป


Estimate
(C.aj)


Q Alternative Practici

C3 incremental
    ^  In thousands of year-0 dollars
                                   TIER 3 COST FACTORS
                        Justification (Please justify)
    Consumer Acceptance

              D    a:.
              YES    N0;
Employee/Union Relations

              D    D
              YES   NO
                         Justification (Pieast justify)
                         Justification (Please justify)
        Corporate Image -

               D;   a..

-------
      Worksheet IV
       Cost Summary
(In thousands ofyear-0 dollars)
Tier
' ITEM DESCRIPTION
Alternative
a. DEPRECIABLE CAPITAL
EXPENDITURES
. b;::
-------
              WorKsheetiV
              Cost Summary
       (In thousands ofyear-0 dollars)
Tier
   JTEM DESCRIPTION
Alternative
a.
b;
c.
d.
e.
DEPRECIABLE CAPITAL
EXPENDITURES
^EXPENSES i''
OPERATING REVENUES
PENALTIES AND FINES
FUTURE LIABILITIES
ANNUAUZED -CASH FLOW

r-5%
Q.





v 10
-------
              Worksheet IV
            -   Cost Summary
        (In thousands ofyear-0 dollars)
Tier
   ITEM DESCRIPTION
Alternative
a.
b.
c.
d.
e.
DEPRECIABLE CAPITAL
EXPENDITURES
EXPENSES
OPERATING REVENUES
I PENALTIES AND FINES
FUTURE LIABILITIES
Current
a.
b.
c.
d.
e.
DEPRECIABLE CAPITAL
EXPENDITURES
•EXPENSES.::-; :. :":" 'V
OPERATING REVENUES
^PENALTIES ;AND FINES
FUTURE LIABILITIES
ANNUAUZED CASH FLOW

V*%





rd= 10%



..-.-..;•;>
f
rd= 15%
. ;




rd= ,






-------
      Worksheet IV
      Cost Summary
(In thousands ofyear-0 dollars)
Tier
- * ITEM DESCRIPTION
Alternative
a. DEPRECIABLE CAPITAL
EXPENDITURES
•b. EXPENSES
c. OPERATING REVENUES
d. PENALTIES AND FINES-
e. FUTURE LIABILITIES
Current
a. DEPRECIABLE CAPITAL
EXPENDITURES
b. EXPENSES .
c. OPERATING REVENUES
d. .PENALTIES AND FINES
e. FUTURE LIABILITIES

ANNUAUZED CASH FLOW

rcT














"•*


Tf




















.






-------
                 Worksheet V
              Financial Worksheet
          (In thousands ofyear-0 dollars)
Tier
ITEM DESCRIPTION
Alternative Less Current
^DEPRECIABLE CAPITAL
/EXPENDITURES
-b. EXPENSES
^'OPERATING REVENUES
d. PENALTIES AND FINES
,.,-A • •. .'.'T^T TTTTTTJ T? -*T T A'"DTT -TT*I PC' "'"
C* ••'.'*-. LJ. J. \_/ jc g*x. JL^irfiiJ | li'i*l j ii fa-fcf -;

"ANNUAUZED CASH FLOW^

rd* s^*
•^•••'



A':;.: ; .,-.
Vio%-
• •










6-.- •





f. TAX LIABILITIES
:ฃ1;NETVSAVINGS FOR TIER
Total Savings
THROUGH TIER 0
! THROUGH TIER 1 :.,:..
• THROUGH TIER 2
.;V|;:;THROUGH'TIER' :3\:^''^

"K.-:
:-.'•;: • • ' ••:•.*?.
..X'.v.,.- •...;••,;•
'•:*T !'.'.'"'• ' '••:-:'-:-
.•'• ': •• •"




••:f:r;v :







':.;?••' ':: •'. ,





IRR

•A;K;;;,:i.;,i,4


il Cash flow tstimates for alternative less current, by definition* is the same
   as cash flow estimates for incremental analysis.

-------
                  Worksheet V
               Financial Worksheet
           (In  thousands ofyear-0 dollars)
Tier
 j -<  ITEM DESCRIPTION
 Alternative Less Current
 a;: DEPRECIABLE: CAPITAL
  : EXPENDITURES
 b. EXPENSES
 COOPERATING REVENUES
 d. PENALTIES AND FINES
 eis FUTURE LIABILITIES
^ANNUALJZED CASH FLOW'-11

r* $%
o
-::"" .




rdซ 10%





rd= 15%





6 =





 f. TAX LIABILITIES
•prNET SAVINGS FOR TIER
 Total Savings
 IRR
THROUGH TIER 0
THROUGH :TIER;I .
THROUGH TIER 2
j: THROUGH TIER 3




.if::::'':,-:



:•.:;.::, ••.:•.:•;_
-


%.:•: • :-;•:.;.:






' !:?.;:"!': ~ . '.'', .'•' .•;':"

!':• J:':*': • *!":V V:':"'
 iJ CซA /7ow estimates for alternative less current, by definition, is the same
   as cask flow estimates for incremental analysis.

-------
                 Worksheet V
              Financial Worksheet
          (In thousands of year-0 dollars):
Tier
    ITEM DESCRIPTION
Alternative Less Current
a,DEPRECIABLE CAPITAL
  EXPENDITURES
b.  EXPENSES
COOPERATING REVENUES
d. PENALTIES AND FINES
 ;; FUTURE LIABILITIES.:
ANNUAUZED CASH FLOW"^

r ซ 5%
a





rd='lO%
'•.:••'



• •••'„
V 1S%





• &=





f. TAX LIABILITIES
      SAVINGS FORTTIER
Total Savings
ฃ\ Cash flow estimates for alternative less current, by definition, is the same
 •  as cash flow estimates for incremental analysis.   *
 IRR
THROUGH TIER 0
THROUGH TIER I'
THROUGH TIER 2
I!! THROUGH TIER 3












-'*•.'.

'.•::.:••• :- • •.

-









-










-------
                 Worksheet V
             Financial Worksheet
          (In thousands of year-0 dollars)
Tier
- ' ITEM DESCRIPTION
Alternative Less Current
a. :DEPRECIABLE CAPITAL
EXPENDITURES
b. EXPENSES
c. OPERATING REVENUES
d. PENALTIES AND FINES
e. FUTURE LIABILITIES


v|$NNU^ZED:;JM
rซ5%
d




1
•y. 10%





rd= 15%





& =





f. TAX LIABILITIES
g. .NET SAVINGS FOR TIER
                                                           IRR
THROUGH TIER 0
THROUGH TIER 1
THROUGH TIER 2
THROUGH TIER 3















-

•




   Cashflow estimates for alternative less current, by definition, is the same
   as cash flow estimates for incremental analysis.

-------
             APPENDIX B




HIDDEN COSTS OF SELECTED REGULATIONS

-------

-------
                                           APPENDIX B

                          HIDDEN COSTS  OF SELECTED REGULATIONS  •
                        '                      '    *                    •           '     ' '

       This appendix presents  a brief description of each specific  requirement included in the hidden
 regulatory cost protocol.  The specific requirements are categorized by regulatory program (and sub-
 categorized by the type of requirement).  The regulatory programs included in .this analysis are:

       •     Resource Conservation and Recovery Act,

       •     Comprehensive Environmental Response, Compensation, and Liability Act,

       •     Superfund Amendments and Reauthorization Act, Title III,                 .

       •     Clean Air Act,                                            -

       •     Clean Water Act, and

       •     Occupational Safety and Health ACL


 B.I  RESOURCE CONSERVATION AND RECOVERY ACT (RCRA)
                              ' • /      .     . • '     "            "  '
       The Resource  Conservation and Recovery Act  (RCRA) was designed to provide technical and
 financial assistance for the development of management plans and facilities for the recovery of energy and
, other resources from discarded materials and for the safe disposal of discarded materials,  and to regulate
 the management of hazardous  waste.

       In accordance with these goals, Federal regulations have been promulgated, many of which may
 involve hidden costs to your facility.  Many of the specific cost creating requirements can be found in Title
 40 of the Code of Federal Regulations Parts 262, 263, 264, 265, and 268.

       Exhibit B-l-1  indicates  the specific requirements associated with particular types of requirements
 that might create costs at your facility.  For example, notification costs under RCRA are driven by the
 notification requirements found in Sections 262.12, 262.53, 264.12, and 26437. Note that the Exhibit cites
 only the general provisions of the  RCRA regulations.  More specific requirements may apply to your
 particular facility, but are not  listed in Exhibit B-l-1.

       Finally, you should note that there may be additional, State- or local-level requirements for your
 facility under  this regulatory program.  These requirements usually do not lessen impact  of the federally
 dictated  Ones.  Indeed, they can require additional activities on your part and, therefore, costs that may
 help justify waste minimization implementations.   You should remain  aware of any  such  additional
 requirements imposed locally.
•.      '            '      '            , '        > ,-.',••              N
 B.1.1 Notification

  •     ง262.12     You must apply for an EPA identification number and notify EPA of your generator
                    status by submitting a Notification of Hazardous Waste Activity form  (8700-12).  This
                    is a one time cost                ••-..•       ,

  •_    ง262J53     You must notify EPA of your intention for exporting hazardous waste.

  •     ง264.12     (a)  As a TSDF owner/operator, you must notify EPA'in
        ง265.12     writing that you will be receiving waste from a foreign source at least four weeks prior
                    to initial  arrival of the waste to your facility.

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                                              B-2
.     ง264.12


•     ง264.12
    (ง265.12(b))

•     ง26437
      ง26537

•     ง264.72
      ง265.72  .

B.1.2  Reporting

•     ง262.41


•     ง262^5


•     ง262.56


•     ง262.43
       ง264.75
       ง265.75

       ง264.76
       ง265.76

       ง264.77
       ง265.77
(b) You must inform the generators of the waste received at your facility that you have
the appropriate permit

(c) Before transfer of ownership of your facility, you
must inform new owners of the requirements of 40 CFR 264 and 40 CFR 270.

You must notify and familiarize local authorities and
emergency response teams of your operations.

You must notify the  Regional EPA office of an improper
manifest receipt if not reconciled with the waste generator or transporter.
A Biennial Report (Form 8700-13A) must be submitted by March 1 every even-number
year to the regional EPA.office if hazardous-waste.i&^ent-off *ite*

If you receive an improper manifest or if you do not receive confirmation of manifest
receipt at all, you must file an Exception Report.

Primary  exporters of hazardous waste  must file an Annual Report summarizing
hazardous waste activities no later than March 1 of each year.

Additional reporting related to the quantity and  disposition of your waste may be
required according to RCRA sections 2002(a) and 3002(b).

Each TSDF must submit a Biennial Report (Form 8700-13B)
outlining waste activities.

Any non-exempt waste received without an accompanying
manifest must be reported to the regional  EPA

Additional reporting is required for releases, fires,
explosions and facility closures, etc.
B.1.3  Monitoring/Testing

•      ง264.13     TSDFs are required to obtain a detailed chemical and
       ง265.13     physical analysis of the wastes present at the facility.

•      ง264.97     Ground-water monitoring is required at all final status TSDFs.

•      ง265.90     Ground-water monitoring is required at land-based  units of Interim Status TSDFs.

B.1.4  Recordkeeping                      '

•      ง262.40     Generators must keep records of all manifests, Biennial Reports, Exception Reports,
                   and any test  results or waste analyses for a period of three years.

 •      ง262^7     For all hazardous waste exports, a primary exporter  must maintain a three year record
                   of  notification forms and Annual  Reports  along  with  a  record  of EPA's
                   Acknowledgement of Consent and confirmation of delivery of your hazardous wastes.

 •     ง263.22     RCRA Transporters  must keep a three year  record of all manifests signed by the
                   generator and the next designated transporter or designated facility.

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                                               B-3
•     ง264.73      TSDFs must maintain comprehensive operating records until            ~-
      ง265.73      closure of the facility.
               t             •      •          •.--'„.          ;             , •         •   >'
B.1.5 Planning/Studies/Modeling

•     ง264.98      A detection monitoring program is required at all Final Status TSDFs.

•     ง265.93      An  outline of a ground-water quality assessment program is required at all  Interim
                   Status TSDFs.

•     ง264.99      A compliance monitoring program is required at all Final Status TSDFs.

•     Pan 264     Subpart D  TSDFs must develop a Contingency Plan and
      Pan 265     Emergency Procedures and submit copies to local fire departments, police departments,
                   hospitals, and  emergency response teams.

•     ง264.142     TSDFs must have developed a cost estimate for facility,
      ง265.142 ,    closure.                                                    '._'.-

•     ง264.144     TSDFs must have developed a cost estimate for facility
      ง265.144   '  post-closure care.

B.1.6 Training

•     ง26234      At least one person at all generator facilities must be trained to coordinate emergency
              •     response measures.

•     ง264.16      TSDFs must provide a facility personnel training program.                •
      ง265.16   '   ,         :

•     ง264.55      An  emergency coordinator must be trained to coordinate
      ง265.55      emergency response measures at TSDFs.
B.1.7  Inspections
                   Specific types of TSDFs have their own inspection regulations, which can be found in
                   ง264.174, ง264.195, ง264.226, ง264.253, ง264.254, ง264303, ง264.347.
•     ง265.201     Small quantity generators have a series of requirements if they accumulate waste in
                   tanks.                                                   .    •

*     ง265.195     Generators may store hazardous waste in tanks provided that they inspect daily  the
                   tanks and document this in operations records.

B.1.8  Manifesting

•     Part 262     Subpart B  A completed copy of each manifest must be given to each transporter and
                   the owner/operator of the designated facility as well as the generator.

•     ง263.20      Transporters must complete and "distribute copies of the manifest to the next delivery
                   point and to the designated facility handling the waste.

•     ง264.71      TSDFs must sign all manifest copies, note any significant
      ง265.71      discrepancies, give the transporter an immediate copy, and send a copy to the generator.

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                                               B-4
B.1.9  Labeling                                                            -

.     ง26231      As a generator, each package shipped must be labeled as part of a pre-transportation
                   requirement

      ง26232      Each package of hazardous waste must, be marked by the generator before sending.

      ง26233      Before transporting hazardous waste or offering the hazardous waste for transportation
                   off site, the generator must placard or offer the appropriate placard to the transporter.

B.1.10  Preparedness/Protective Equipment

 •     ง26432     TSDFs are required  to have an internal communicating
       ง26433     alarm system, devices for summoning local assistance,
       ง26434     fire control equipment, and a water supply system.  You
       ง26532     must also have a 24-hour surveillance system, a physical                        •
       ง26533     facility barrier, and a means of controlling entry to
       ง26534     your facility (including sufficient warning signs).

 B.1.11  Closure/Post-Closure Assurance

 .     ง264143    A TSDF owner/operator must establish financial assurance            ,.'.,.  .,.>
       ง265:143    for dosure of the facility through the selection of one of the options listed m this
                   section.

 •     ง264.145    The owner/operator of a  hazardous waste management unit
       ง265.145    must establish financial assurance for post-closure care.

 B.1.12 Insurance and Special Taxes

  .      s?64147     TSDFs are required to demonstrate financial
        ง265147     responsibility  for injuries  and property damages  to  third  parties either  through
        ง           SSrance oT through some other trust .fund that will provide at least $1 nuuior,Mfor
                    accidental occurrences with an annual aggregate of $2 million exclusive of legal defense
                    costs.

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                                             B-5
                                        EXHIBIT B-l-1

                REGULATORY COSTS UNDER THE RESOURCE CONSERVATION
                                 AND RECOVERY ACT (RCRA)
      Type of Requirement
              Specific Requirement in 40 CFR
Notification


Reporting


Monitoring/Testing

Recordkeeping

Planning/Studies/Modeling


Training

Inspections

Manifesting

Labeling

Preparedness/Protective
Equipment         ,

Closure/Post-Closure Assurance

Medical Surveillance

Insurance and Special Taxes
ง262.12, ง26153, ง264.12, ง26437,  ง264.72, ง265.12, ง26537,
ง265.72

ง264.75, ง262.41, ง26143, ง262^5,  ง262^6, ง264.76, ง264.77,
ง265.75, ง265.76, ง265.77

ง264.13, ง264.97, ง265,13, ง265.90

ง262.40,. ง26237, ง262.73, ง263.22, ง265.73

ง264.142, ง264 Subpart D, ง265 Subpart D, ง264.98,
ง264.99, ง264.144, ง265.93, ง265.142, ง265.144

ง26234(d)(5)(i), ง264.16, ง264.55, ง265.16, ง265.55

ง264 Subparts I  - X, ง265.201, ง265.195

ง262 Subpart B, ง263.20, ง264.71, ง265.71

ง26231, ง26232, ง26233

ง264.32, ง26433, ง264.34, ง26532, ง26533, ง265.34


ง264.143, ง264.145, ง265.143, ง265.145

NA                   " V  ' •• •  •  '    -        '. '  "    . -.

ง264.147, ง265.147              '•.-..'
NA = Not Applicable

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                                            B-6
B.2 COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY
    ACT (CERCLA)
      The Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA)
.as enact J I to'provide  for liability, compensation, cleanup, and emergen cy  respo ** f<ป hazardous
substances released into the environment and the cleanup of inactive hazardous waste disposal sites.
      The subsequent promulgation of Federal regulations may involve hidden * ft^J"?! ซ Smer
     facffitv  Although the primary impact of CERCLA cost considerations will be addressed ro Chapter
     e Se UabS CosteTS H) section of this benefits manual), there are some factors that should
       fert here.  Namely, Ae tax on certain chemicals could be considered  a hidden overhead cost at
     facility. The Section 4661 taxes are listed in Exhibit B-2-1 and appear in Subtitle A, Subchapter B
of CERCLA.

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                                           B-7
                                      EXHIBIT B-2-1


                TAX ON CERTAIN CHEMICALS UNDER CERCLA SECTION 4661
Chemical
Acetylene
Ammonia
Antimony
Antimony trioride
Arsenic
Arsenic trioxide
Barium sulfide
Benzene
Bromine
Butadiene
Butane
Butylene
Cadmium
Chlorine
Chromite
Chromium
Cobalt
Cupric oxide
Cupric sulfate
Cuprous oxide ,
Ethylene
Amount of Tax
(S per Ton)
4.87
2.64
4.45
3.75
4.45
3.41
230
.4.87
4,45
. 4.87
4.87
4.87
4.45
2.70
1.52
4.45
4.45
3.59
1.87
3.97 .
4.87
Chemical
Hydrochloric acid
Hydrogen fluoride
Lead oxide
Mercury
Methane
Naphthalene
Nickel
Nitric acid
Phosphorous
Potassium dichromate
Potassium hydroxide
Propylene ,
Sodium dichromate
Sodium hydroxide
Stannic chloride
Stannous chloride
Sulfuric acid
Toluene
Xylene
Zinc chloride .
Zinc sulfate _
Amount of Tax
($ per Ton)
0.29
4.23
4.14
4.45
3.44
4.87
4.45
0.24
~ 4.45
1.69
0.22
4.87
1.87
0.28
2.12
2.85
0.26
4.87
4.87
2.22
1.90
SOURCE: SARA (PL 99-499) Subtitle A, Subchapter B Section 4661.
                              t.    •                 •       •  '   . , •

NOTE:   The majority of costs associated with CERCLA are considered within

       the Future Liabilities (Tier II) section of this benefits .manual
       Only the Section 4661 taxes are included in Tier I.

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                                               B-8
B3  SUPERFUND AMENDMENTS AND REAUTHORIZATION ACT, TITLE HI (SARA TITLE

      Title III of the Superfund  Amendments and Reauthorization Act, which  is also known as  the
Emergency Planning and Community Right-to-Know Act of 1986, is intended to encourage and support
emergency planning efforts at the State and local levels and provide the public and local governments with
information concerning potential chemical hazards present in their communities.  The emergency planning
requirements of SAPA Title III  recognize the  need to establish and  maintain  contingency plans  for
responding to chemical accidents  which  can inflict health  and environmental  damage as well as cause
significant disruption within a community.

      Federal regulations designed to produce these goals have been promulgated and could  possibly
involve hidden costs at your facility. Many of the specific cost creating requirements can be found in Title
40 CFR Parts 350, 355, 370, and 372.

      The most important requirements are Sections 312 and 313 of SARA. Section 312 covers emergency
preparedness for accidental releases while  Section 313 calls for reporting. alL environmental releases of
Section 313 chemicals. The regulations corresponding to these two sections are found in 40 CFR ง370.25
and ง37230, respectively, and are presented in Subsection B3.2 below.  The reports submitted under SARA
Section 313 have begun to bring scrutiny on facilities from the communities where the facilities are located.
EPA feels that this reporting requirement will have a major influence on pollution prevention.

      Exhibit B-3-1 indicates the specific requirements associated with particular types of requirements that
might create costs at your facility.  For example, notification costs under SARA Title III are driven by the
specific notification requirements found in  Sections 35530 and 355.40.

      Finally, you should note that there  may be additional, State- or local-level requirements  for your
facility under this regulatory program.  These requirements usually do not lessen impact of the  federally
dictated ones.  Indeed, they can require additional activities on your part, and, therefore, costs that  may
help justify waste minimization implementations.   You  should remain aware of any such additional
requirements imposed locally.

B3.1 Notification

•     ง35530     (b)    You are required to  notify the State emergency  response  commission  (or
                   Governor if no commission exists) that your facility is subject to the provisions of Part
                   355.

•     ง35530     (d)(l)  You  must inform the local emergency planning  committee of  any  facility
                   changes that will affect emergency planning, and
                   (2)     you are required to furnish information relevant to emergency planning upon
                   request.

•     ง355.40     (b)(l)  You are required to inform the community emergency coordinator or the local
                   emergency response  committee of the area most likely to be affected by a release.
                   (3)      You  are also required to submit a written  follow-up emergency notice after
                   a release.
                    (2) and (4) give  information regarding what the notices should include and what
                   exceptions exist

 •     ง372.45      If you  sell or distribute a mixture  or trade name product to a facility described in
                    ง372.22, you  must inform each person who receives  the  material of toxic chemical
                    information as described in  ง372.45(b).

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                                              B-9
B3.2  Reporting

•     ง370.21
      ง37025
      ง37230
                   (a)    You may be required to submit a Material Safety Data Sheet (MSDS) for each
                   hazardous chemical present at your facility to the local emergency response committee,
                   the State commission and the local fire department   (Note:  there are alternative
                   reporting methods in lieu of the MSDS report -see ง370.21(b))

                   (c)    Significant additional information concerning the hazardous chemical must be
                   submitted in a revised MSDS report                         •  ,           •

                   (d)    You must submit a MSDS. report upon request by the emergency response
                   committee.

                   (a)  ,  If you are subject to Part 370 then you must submit an inventory form to the
                   emergency response commission, committee and local fire department  The report must
                   contain Tier I information and shall be submitted before March 1 of each year, starting
                   in 1988.  (Note:  a Tier II form may be submitted in  lieu of the Tier I form - see
                   ง370.25(b))

                   (c)    You must submit a Tier II report  if requested by the emergency response
                   commission.

                   (a)    For  each toxic chemical  known to be  manufactured (including imported),
                   processed, or otherwise used in excess of an applicable threshold quantity (see ง37225),
                   the owner/operator must submit EPA Form  R (EPA Form 9350-1) to EPA and to the
                ,   State in which the facility is located (the chemicals for which this requirement currently
                   applies are found in Part 372 Subpart D).

                   (b)    A Form R report also may need to be completed for  a toxic  chemical known
                   to be present  as a  component  of a mixture or trade name  product  that exceeds
                   thresholds as defined in paragraph (a).                *

                   Note:  .ง37230(b)(2) provides guidelines for determining  threshold amounts if the
                   concentration or identity of a chemical is unknown in a trade name product
                   Note also:  Certain reporting exemptions exist for de minimis concentrations of a toxic
                   chemical, articles, specific uses, laboratory activities, certain owners of leased properties,
                   and certain operators of establishments on leased  property. Details  of these exemptions
                   can be found in ง37238.

B33  Recordkeeping                                ~   "

•     ง372.10      (a)    If you are subject to Part 372 you are required to keep  records of the following
                   for 3 years:
                   (1)    the report you submit  under ง37230
                   (2)    compliance determination materials and documentation under ง372.22 or ง372.45
                   (3)    documentation supporting the Form R (ง37230) report (for documentation
                   details see ง372.10(3))              '

                   (b)    If you are subject to the  notification requirements of Part 372 then you are
                   required to  keep records of the following for 3 years:
                   (1)   . all supporting materials and documentation used to determine whether a notice
                   is required under' ง372.45
                   (2)   all supporting materials and documentation  used in developing each required
                   notice under ง372.45 and a copy of each notice.

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                                               B-10
B.3.4 Inspections                                                           .

      ง370 25      If you submit an inventory form under ง37025 then you are required to allow on-site
                   inspection by the fire department having jurisdiction over the facility upon request of
                   the department, and shall provide specific location information on hazardous chemicals
                   at the facility.

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                                          B-ll
                                      EXHIBIT B-3-1                 .
                          REGULATORY COSTS UNDER TITLE HI
           THE SUPERFUND AMENDMENTS'AND REAUTHORIZATION ACT (SARA)
      Type of Requirement
Specific Requirement in 40 CFR
Notification
Reporting
Monitoring/Testing
Recordkeeping
Planning/Studies/Modeling
Training
Inspections
Manifesting
Labeling
Preparedness/Protective Equipment
Closure/Post-Closure Assurance
Medical Surveillance
Insurance and Special Taxes
ง35530, ง355.40, ง372.45
ง370.21, ง370.25, ง370.28, ง37230
NA                    '
ง372.10                -
NA      '',...;
NA        -.         .'
ง370.25
NA
NA"
NA
NA
NA
NA = Not Applicable

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B.4  CLEAN AIR ACT (CAA)                                                 '
                   t                            -                             '
      Section 101(b) of the Clean Air Act (CAA) states that the purposes of the Act are to protect and
enhance the quality of the nations air resources so as to promote the public health and welfare and the
productivity capacity  of its population; to initiate  and accelerate a  national research and development
program to achieve the prevention and control of air pollution; to provide technical and financial assistance
to State and local governments in connection with the development  and execution of their air pollution
prevention and control programs; and to encourage and assist the development and operation of regional
air pollution control programs.                  .                        *

      Federal regulations  have been promulgated pursuant to these goals, several of which may involve
hidden costs at your facility.  Many of the specific cost-creating regulations include 40 CFR Parts 58, 60,
61, 66, and  67.

      Exhibit B-4rl  indicates the types of hidden costs associated with specific CAA regulations.  For
example, reporting costs attach to the reporting requirements in Sections 60.7, 61.09, and 61.11. Note that
this Exhibit cites only the general provisions of the CAA regulations.   Other, industry-specific requirements
may apply to you  but are not listed  in Exhibit B-4-1.       -

      Exhibit B-4-2 provides a list of the industries with specific regulations on standards of performance
for new stationary sources of air emissions, and gives the location in 40 CFR Pan 60 where they can be
found. You should be aware of these regulations when determining regulatory costs at your facility.

      Specific regulations may also  apply if you emit hazardous air  pollutants as defined by Section 112
of the CAA.  Exhibit B-4-3 lists these pollutants.

      In  addition to the hazardous air pollutant regulations, industry-  and  chemical-specific  National
Emissions Standards for hazardous air pollutants (NESHAPS) may also apply to  your facility.  The
industries and chemicals as well as their location in 40 CFR are listed in Exhibit B-4-4.

       Not included in this general overview are the requirements surrounding" the Prevention of Significant
Deterioration (PSD)  permits or the nonattainment permits.  These programs are driven in most areas  by
State implementation plans and  consequently  vary  from region to region.   There may be  reporting,
monitoring, and recordkeeping costs associated with these permits and Other local regulations, which you
should  be aware of when calculating your hidden O&M costs.     ,

B.4.1 Notification

•     ง60.7        (a)    You are required to furnish the Administrator of the Environmental Protection
                    Agency or the appropriate State agency with written notification of:
                    (1)    the date that construction  of an  affected  facility  (a facility  with  applicable
                    stationary source standards) is commenced;
                    (2)    the anticipated date  of initial startup of an affected  facility,
                    (3)    the actual date of initial startup of an affected facility;
                    (4)    any physical or operational change to your facility that increases the emission
                    rate of any air pollutant;
                    (5)    the date of your continuous monitoring system initial demonstration;
                    (6)    the anticipated date for conducting opacity observations; and
                    (7)    the use of your continuous opacity monitoring system data results to determine
                    compliance with the applicable capacity standard during a performance test.

 •     ง61.09       You are required to provide notification of the anticipated and actual  startup of a
                    facility with hazardous emissions (Exhibit B-4-4).

 •     ง61.13       If your facility emits hazardous pollutants to the air (Exhibit B-4-2), there are further
                    notification requirements, including notice of startup and notice of all emissions tests.

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                                               B-13
B.4.2  Reporting

•     ง60.7        (c)    You are required to submit a Compliance and Monitoring Assessment Report
                   every calendar quarter.  The report should contain  compliance data and relevant
                   monitoring and process data.     ......

•     ง60.8        Performance test results are to be reported as indicated by the appropriate regulatory
                   agency.                              _               .

•     ง60.11       All opacity test results are to be reported to the appropriate regulatory agency.

•     ง61.10       If you are the owner or operator of an existing source or a new source which had an
                   initial startup before  the  effective date of the regulation, then you are  required to
                   submit a report that includes identity of the hazardous pollutants, amounts emitted,
                   control devices used, etc.

•     ง61.14       The results of any performance test of your hazardous pollutant monitoring system must
                   be recorded.                                         \

B.4.3  Monitoring/Testing

•     ง60.13       Each operator of an emissions producing facility must install a continuous monitoring
        - •"• ,    ' • "'system.'     -'      •.     '             -   •     '    • •    ,      .

•     ง60.8        Also  required is emissions control  performance testing, for which you must provide
                   sampling ports, sampling platforms, safe access to sampling platforms, and utilities for
                   sampling equipment.                                        ,

•     ง60.11       Your facility may employ a Continuous Opacity Monitoring System (CQMS) in order
                   to demonstrate compliance with opacity regulations.

•     ง61.14       Hazardous pollutant emissions (Exhibit B-4-3) require additional monitoring.

•     ง61.13       Additional emissions tests  are also  required  for hazardous pollutants (Exhibit B-4-3).

B.4.4  Recordkeeping

•     ง60.7        (b)   You are required to maintain records of the following:
                         the occurrence and duration of any startup, shutdown, or malfunction of the
               -          facility;;
                   -     the occurrence and duration of pollution control equipment failure or monitoring
                         equipment failure.

•     ง60.8        All performance test data  must be  recorded.

•     ง60.11       All opacity test data must be recorded.

•     ง61.14       Hazardous pollutant monitoring data must be recorded.

•     ง61.13       Hazardous emissions  test  results must be recorded.           ,

B.4.5 Inspections

•     ง60.11       Part of regulation compliance enforcement includes the inspection of point sources of
                   pollution.         .

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                                              B-14
                                         EXHIBIT B-4-1

                   REGUIATORY COSTS UNDER THE CLEAN AIR ACT (CAA)
      Type of Requirement
Notification

Reporting

Monitoring/Testing

Recordkeeping

Planning/Studies/Modeling

Training

Inspections

Manifesting

Labeling

Preparedness/Protective Equipment

Closure/Post-Closure Assurance

Medical Surveillance

Insurance and Special Taxes   	
     Specific Requirement in 40 CFR a/
.  ง60.7, ง61.09, ง61.13 ,b/

  ง60.7(c), ง60.8, ง60.11, ง61.10, ง61.14 b/

  ง60.8, ง60.11, ง60.13, ง61.13, ง61.14 b/

  ง60.7(b), ง60.8, ง60.11, ง61.13(g), ง61.14 b/

  NA         .

  NA

  ง60.11

  NA

  NA            .

  NA           '.

  NA

  NA

   NA
 NA -    Not Applicable; i.e.,  no general (i.e., not industry-specific)  requirements  apply to  this cost
          category.

 a/        Citations to general regulatory provisions only, i.e., industry-specific requirements are not cited
          in this exhibit

 b/        Chemical-specific standards apply.

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                                            B-15
                                       EXHIBIT B-4-2

                     CLEAN AIR ACT INDUSTRY-SPECIFIC REGUIATIONS
            ON STANDARDS OF PERFORMANCE FOR NEW STATIONARY SOURCES
                    Affected Industry
                                       Reference in 40 CFR
Ammonium Sulfate Manufacture
Asphalt Concrete Plants
Asphalt Processing and Asphalt Roofing Manufacture
Automobile and Light-Duty Truck Surface Coating Operations
Coal Preparation Plants
Electric Utility Steam Generation (Construction commenced
  after 9A8/78)       „
Ferroalloy Production Facilities
Fossil-Fuel Fired Steam Generators (Construction commenced
  after 8/17/71)
Glass Manufacturing Plants
Grain Elevators
Graphic Art Industry: Publication Rotogravure Printing
Incinerators
Industrial Surface Coating:  Large Applications
Industrial-Commercial-Institutional Steam Generating Units
Kraft Pulp Mills
Lead-Acid Battery Manufacturing Plants
Lime Manufacturing Plants
Metal sCoil Surface Coating
Metallic Mineral Processing Plants
Nitric Acid Plants           •      ,
Petroleum Refineries
Phosphate Fertilizer Industry:
Phosphate Fertilizer Industry.
  Storage Facilities
Phosphate Fertilizer Industry:
Phosphate Fertilizer Industry:
Phosphate Fertilizer Industry:
Phosphate Rock Plants
Portland Cement Plants
Pressure Sensitive Tape and Label Surface Coating Operations
Primary Aluminum Reduction Plants
Primary Copper Smelters
Primary Emissions from Basic Oxygen Process Furnaces
  (Construction commenced after 6/11/73)
Primary Lead Smelters
Primary Zone Smelters
Secondary Brass and Bronze Ingot Production Plane
Secondary Emissions from Basic Oxygen Process Steelmaking
  Facilities (Construction commenced after 1/20/83)
Sewage Treatment Plants
Secondary Lead Smelters
Stationary Gas Turbines
Triple Superphosphate Plants
Granular Triple Superphosphate  ,

Diammonium Phosphate Plants'
Superphosphoric Acid Plants
Wet-Process Phosphoric Acid Plants
ง60, Subpart PP
ง60, Subpart I
ง60, Subpart UU
ง60, Subpart MM
ง60, Subpart Y
ง60, Subpart Da

ง60, Subpart Z
ง60, Subpart D

ง60, Subpart CC
^eO^Subpart DD
ง60, Subpart QQ
ง60, Subpart E
ง60, Subpart SS
ง60, Subpart Db
ง60, Subpart BB
ง60, Subpart KK
ง60, Subpart HH
ง60, Subpart TT
ง60, Subpart LL
ง60, Subpart G
ง60, Subpart J
ง60, Subpan W
ง60, Subpart X

ง60, Subpart V
ง60, Subpart U
ง60, Subpart T
ง60, Subpart NN
ง60, Subpart F
ง60, Subpart RR
ง60, Subpart S
ง60, Subpart P
ง60, Subpart N

ง60, Subpart R
ง60, Subpart Q
ง60, Subpart M
ง60, Subpart Na

ง60, Subpart O
ง60, Subpart L
ง60, Subpart GG

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                                           B-16
                                  EXHIBIT B-4-2 (continued)

                    CLEAN AIR ACT INDUSTRY-SPECIFIC REGULATIONS
            ON STANDARDS OF PERFORMANCE FOR NEW STATIONARY SOURCES


                    Affected Industry                 '              Reference in 40 CFR

Steel Plants: Electric Arc Furnaces                                     ง60, Subpart AA
Steel Plants: Electric Arc Furnaces and Argon-Oxygen                    ง60, Subpart AAa
  Decarburization Vessels (Constructed after 8/17/83)                             .
Storage Vessels for Petroleum Liquids (Construction,                      ง60, Subpart K
  reconstruction, or modification  commenced between 6A1/73
  and 5/19/78)
Storage Vessels for Petroleum Liquids (Construction,                      ง60, Subpart Ka
  reconstruction, or modification commenced between 5/18/78-
  and 7/23/84)                               '              ,
Sulfuric Acid Plants                                                   ง60, Subpart H
Surface Coating of Metal Furniture                                     ง60, Subpart EE
Synthetic Organic  Chemicals Manufacturing: Equipment Leaks             ง60, Subpart W
  ofVOC
Volatile Organic Liquid Storage Vessels (Construction,                    ง60, Subpart Kb
  reconstruction, or modification commenced after 7/23/84)


SOURCE:  40 CFR  Part 60.

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                                             B-17
                                        EXHIBIT B-4-3                 .

         HAZARDOUS AIR POLLUTANTS WITH PARTICULAR EMISSIONS STANDARDS
                                 UNDER THE CLEAN AIR ACT
      The following list presents the substances that, pursuant to Section 112 of the Clean Air Act, have
been designated as hazardous air pollutants;  Special emissions standards apply to these substances which
may be significant in determining hidden costs at your facility.

                  Asbestos                            Inorganic Arsenic
                  Benzene                            Mercury
                  Beryllium                           Radionuclides
                  Coke Oven Emissions                 Vinyl Chloride

      The following list presents other substances for which a Federal Register notice has been published
that included consideration of the serious health effects, including cancer, for ambient air exposure to the
substance. .Special emissions standards may also apply to these substances.

                  Acrylonitrile                         Hexachlorocyclopsntadiene
                  1,3-Butadiene                        Manganese
                  Cadmium                           Methyl Chloroform                     _
                  Carbon Tetrachloride                 Methylene Chloride
                  Chlorinated Benzenes                 Nickel
                  Chlorofluorocarbon                   Perchloroethylene
                  Chloroform                         Phenol
                  Chloroprene                         Polycyclic Organic Matter
                  Chromium                           Toluene
     •  •  •         Copper                             Trichloroethylene
                  Epichlorhydrin                       Vinylidine Chloride
                  Ethylene Dichloride                  Zinc and Zinc Oxide
                  Ethylene Oride


SOURCE:  40GFRPaft61                       ^

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                                           B-18
                                      EXHIBIT B-4-4

            INDUSTRIES WITH PARTICULAR NATIONAL EMISSIONS STANDARDS
              FOR HAZARDOUS AIR POLLUTANTS UNDER THE CLEAN AIR ACT
                     Industry
Asbestos
Beryllium
Beryllium Rocket Motor Firing
Equipment Leaks (Fugitive Emission Sources)
Equipment Leaks (Fugitive Emission Sources) of Benzene
Inorganic Arsenic Emissions From Arsenic Trioride and
  Metallic Arsenic Production Facilities
Inorganic Arsenic Emissions From Glass Manufacturing
  Plants                               '           '
Inorganic Arsenic Emissions From Primary Copper Smelters
Mercury                                        ซ>ซT5\
Radionuclide Emissions From Department of Energy (DOE)
  Facilities
Radionuclide Emissions From Elemental Phosphorous Plants
Radionuclide Emissions From Utilities Licensed by the
  Nuclear Regulatory Commission (NRC) and Federal
  Facilities Not Covered By Subpart H
Radon-222 Emissions From Licensed Uranium  Mill Tailings
Radon-222 Emissions From Underground Uranium Mines
Vinyl Chloride
Reference in 40 CFR
 ซ.^ซiMMซB•—^^— -

  ง61, Subpart M
  ง61, Subpart C
  ง61, Subpart D
  ง61, Subpart V
  ง61, Subpart J
  ง61, Subpart P

  ง61, Subpart N

  ง61, Subpart O
  ง61, Subpart E
  ง61, Subpart H

  ง61, Subpart K
  ง61, Subpart I
   ง61, Subpart W
   ง61, Subpart B
   ง61, Subpart F
 SOURCE: 40 CFR Part 61.

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                                               B-19
B.5    CLEAN WATER ACT (CWA)                                          •

       Section 101.(a) of. the Clean Water Act (CWA) states that the objective of the Act is to restore and
maintain the chemical, physical and biological integrity of the Nation's waters.

       In an attempt to achieve these goals, Federal regulations have been promulgated which include isuch
provisions as  monttoring and treatment standards, effluent ^^.^^.^^rd^a^'
etc. Many of these regulations may involve hidden costs to your facility.  In particular, 40 CFR Parts 117,
122, 123, 129, and 403 are significant in defining hidden regulatory costs.  ;
       Exhibit B-5-1 indicates  the types Of hidden costs associated                  iia-
 example, notification costs attach to the notification requirements of Section 122.41, 117.21  and 129.5.
 Note that the Exhibit presents only general CWA provisions.  Pollutant- and industry-specific regulations
 may apply to you that are not listed in this Exhibit

       Exhibit B-5-2 provides a list of toxic pollutants with particular effluent guidelines  found in 40 CFR
 ง401.15.  Regulation of these pollutants could mean additional costs at your facility.

       Industry-specific effluent guidelines may also apply to your facility, and could mean added regulatory
 cost  Industries subject to these guidelines are listed in Exhibit B-5-3.  The list also includes the location
 in 40 CFR.
     ,                           ! '                .        ,  -
       Finally, you should note that there may be additional, State- or local-level requirements for your
, facility under this regulatory program.  These requirements usually do not lessen impact of the federally
 dictated  ones.  Indeed, they can require additional activities on your part, and, therefore, costs that may
 help justify  waste minimization  implementations.  You should remain aware of any such additional
 requirements imposed locally.
 B.5.1  Notification

  •     ง122.41
        ง117.21
        ง129.5
  •      ง403.12 .


  B.5.2  Reporting

  •      ง122.41
(to   If YOU are the owner/operator of a facility that directly discharges into navigable
waterways or discharges into  Privately Owned Treatment Works (POTWs), you have
the duty to provide discharge information to the EPA or to the appropriate State
agency for decision making purposes. This notification requirement is described within
the National Pollutant Discharge Elimination System (NPDES) permitting process.

You have notification responsibilities following the direct discharge pf a reportable
quantity of any hazardous pollutant (Exhibit B-5-2) that exceeds promulgated standards.

(a)(l)   You must notify the Administrator that you have a toxic pollutant discharge
within 60 days of the promulgation of the standard.
(2)    You must also notify the Administrator if you intend to commence any activity
which would  result in the discharge of  a toxic pollutant  that has specific effluent
standards.

(f)    The Industrial User must notify the POTW of any slug loading as defined by
ง403.5(b)(4).
 (1)    The EPA or the appropriate State agency requires a report of the following:
 (1)   Planned changes to the permitted facility;
 (2)   Anticipated noncompliance;
,(3)   Notice of transfer of permit;
 (4)   Monitoring results;
 (5)   Compliance schedules;

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                                              B-20
                   (6)    24-hour reporting of unanticipated discharges that present an immediate health
                   threat to the public,
                   (7)    Other noncompliance; and
                   (8)    Relevant facts not initially reported (supplemental reports).

•     ง122.44      The frequency of these reports depends on the nature and effect of the discharge, but
                   will be performed at least once yearly.

•     ง129.5       (d)(2) You are required to file annual compliance reports if you are subject to any
                   toxic standard or prohibition (unless already included in your NPDES permit)

•     ง403.12      Industrial Users  discharging to POTWs have further  reporting requirements, which
                   include:

                   (b)    Baseline Monitoring Reports (performed once; it provides general information
                   about your  facility and process);

                   (d)    report on compliance with categorical pretreatment standard deadlines  (also
                   performed only one time);

                   (e)    periodic reports on continued compliance (performed twice yearly, in June and
                   December).                       .

•     ง129.5       (d)(l) Reporting compliance conditions is required upon the compliance date for any
                   Exhibit B-5-2 toxic pollutant effluent standard or prohibition.
                   (2)   Within 60 days following the close of each calendar year, each owner or operator
                   of a discharge  subject to any   toxic standard or prohibition  must report to the
                   appropriate agency.

B.5.3 Monitoring/Testing

•     ง122.41      Q)    to order  to meet comprehensive reporting requirements, you must perform
                   monitoring and sampling of your  effluent streams  for  the purpose  of increased
                   compliance.

•     ง403.12      (g)   Monitoring  is also required  to  demonstrate continued  compliance  with
                   pretreatment standards for discharges to POTWs.

•      ง129.5      (d)(3) For toxic effluents, you must take 5 discharge samples at approximately equal
                   intervals throughout the working day.

B.5.4 Recordkeeping

 •      ง122.41      0)   You are required to keep accurate records of all monitoring information under
                   the NPDES.

 •      ง403.12     (1)    All  Industrial Users of POTWs are  required to maintain records of  all
                   information resulting from monitoring activities.

 •     ง129.5       (d)(l>2)  You are ako required to provide records of all  toxic pollutants (Exhibit B-
                    5-2) and toxic effluent discharge compliance.

 B.5.5  Inspections                                    <
 .     ง122.41      (i)    The EPA or the appropriate State agency has legal authority to enter your
                    facility for the purposes of inspection and investigation of compliance.

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B.5.6  Preparedness/Protective Equipment                                    •      •
       :•                ' .   I  .  '  .'.         ..,    • .      ,                     '     _   '  '•
•     ง122.41      (e)    This provision requires the operation of backup or auxiliary facilities or similar
                   systems which are installed by a NPDES permittee only when the operation is necessary
                   to achieve compliance with the conditions of the NPDES permit

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                                              B-22
                                         EXHIBIT B-5-1

                 REGULATORY COSTS UNDER THE CLEAN WATER ACT (CWA)
      Type of Requirement
  Specific Requirement in 40 CFR a/
Notification

Reporting

Monitoring/Testing

Recordkeeping

Planning/Studies/Modeling

Training

Inspections

Manifesting

Labeling

Preparedness/Protective Equipment

Closure/Post-Closure Assurance

Medical Surveillance

Insurance and Special Taxes  	
ง117.21, ง122.41(h), ง129.5(a)(l,2)

ง122.41, ง122.44, ง129.5(d)(l,2), ง403.12

ง122.410), ง129.5(d)(13), ง403.12

ง122.410), ง!29.5(d)(U), ง403.120)

NA

NA

ง122.41(i),

NA

NA

ง122.41(6)

NA

NA

NA
NA = Not Applicable; i.e., no general (i.e., not industry-specific) requirements apply to this cost category.

a/     Citations to  general  regulatory  provisions only,  i.e.,  neither  industry- nor  chemical-specific
       requirements are cited in this exhibit.

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                                              B-23




                                         EXHIBIT B-5-2
                            :  .        '           '         / •     '       •r '

                     TOXIC POLLUTANT^ UNDER THE CLEAN WATER ACT
      The following list is comprised of the toxic pollutants designated pursuant to Section 307(a)(l) of
CWA   •       .'      '•   '    •   :'  .".-..     .'     ... ';            .  '     :   -'   ,-   '    -   •• "

      Effluent standards have been promulgated for substances in bold.  General and chemical-specific
standards for these toxic pollutants can be found in 40 CFR 129.
                     s              '                                '         ,

      Effluent standards are to eventually be promulgated for all substances on this list
Acenaphthene             .
Acroiein
Acrylonitrile                      ,
Aldrin/Dieldrin
Antimony and compounds              >
Asbestos
Benzene
Benzidine
Beryllium and compounds             -••'  '
Cadmium and compounds
Carbon tetrachloride              ;
Chlordane (technical mixture and metabolites)
Chlorinated benzenes (other than
  dichlorobenzenes)
Chlorinated ethanes (including 1,2-
  dichlbroethane, 1,1,1-trichloroethane, and
  hexachloroethane)
Chloroalkyl ethers cnloroethyl and mixed ethers)
Chlorinated naphthalene
Chlorinated phenols  (other than those listed
  elsewhere, includes trichlorophenols and
  chlorinated cresols)             '
Chloroform
2-chlorophenol
Chromium and compounds
Copper and compounds
Cyanides
DDT and metabolites
Dichlorobenzenes (1,2-, 1,3, and 1,4-
  dichlorobenzenes)
Dichlorobenzidine              .
Dichloroethylenes (1,1-and 1,2-dichloroethylene)
2,4-dichlorophenol
Dichlprppropane and dichloropropene
2,4-dimethylphenol
Dinitrotoluene
Diphenylhydrazine
Endosulfan and  metabolites
Endrin and metabolites
Ethylbenzene -••-•-,-
Fluoranthene
Haloethers (other than those listed elsewhere,
  includes chlorophenylphenyl ethers,
  bromophenylphenyl either, bis(dichloroisopropyl)
  ether, bis(chloroethoxy) methane and
  poiychlorinated diphenyl ethers)
Halomethanes (other than those listed elsewhere;
  includes methylene chloride, meihylchloride,
  methylbromide, bromoform, dichlorobromo-
  methane)      '
Heptachlor and metabolites
Hexachlorobutadiene
Hexachlorocyclohexane
Hexachlorocyclopentadienelsophorone
Lead and compounds
Mercury and compounds
Naphthalene       ,
Nickel and compounds
Nitrobenzene          *
Nitrophenols  (including 2,4-dinitrophenol,
  dinitrocresol)
Nitrosamines             .
Pentachlorophenol   '
Phenol
Phthalate esters
Poiychlorinated biphenyls (PCBs)
Polynuclear aromatic hydrocarbons  (including
  benzanthracenes, benzopyrenes, benzofluoranthene,
  chrysenes, dibenzanthracenes, and indenopyrenes)
Selenium and compounds
Silver and compounds
23,7,8-tetrachlorodibenzo-p-dioxin (TCDD)
Tetrachloroethylene
Thallium and compounds'
Toluene

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                                       B-24




                              EXHIBIT B-5-2 (continued)

                  TOXIC POLLUTANTS UNDER THE CLEAN WATER ACT
                               Toxaphene
                               Thchloroethylene
                               Vinyl chloride
                               Zinc and compounds
SOURCE: 40 CFR Part 401.

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                                            B-25
                                       EXHIBIT B-5-3

                  INDUSTRIES WITH PARTICULAR EFFLUENT GUIDELINES
                     AND STANDARDS UNDER THE CLEAN WATER ACT
                  Industry                                            Reference in 40 CFR.

Aluminum Penning      '                                                     ง467
Asbestos Manufacturing                                                       ง427
Battery Manufacturing Point Source Category                                    ง461
Builders Paper and Board Mills                                                ง431
Canned and Preserved Fruits and Vegetables,	 ..    .   ..	  	    ..ง407
Canned and Preserved Seafood                                                 ง408
Cement Manufacturing                                                        ง411
Coil Coating         .                                                        ง465
Copper Forming                                                              ง468
Dairy Products                                                               ง405
Electrical and Electronic  Components                                           ง469
Electroplating                                                                ง413
Explosives Manufacturing                                                      ง458
Feedlots                                                              .       ง412
Ferroalloy Manufacturing                                                      ง424
Fertilizer Manufacturing                                 .                      ง418
Glass Manufacturing                                                          ง426
Grain Mills                 .                                 _               ง406
Gum and Wood Chemicals  Manufacturing                                       ง455
Hospitals v                                                                .  ง460
Ink Formulating                                                              ง447
Inorganic Chemicals                                                ". •        ง415
Iron and Shell Manufacturing                                                  ง420
Leather Tanning and Finishing                                                 ง425
Meat Products                                                               ง432
Metal Finishing                                                               ง433
Metal Molding and Casting                                                    ง464
Mineral Mining and Processing                                                 ง436
Nonferrous Metals                                                            ง421
Nonferrous Metals Forming and Metal Powders                                  ง471
Offshore Oil and Gas Extraction                                 .         ,     ง435
Ore Mining and Dressing                                                     ง440
Organic Chemicals                                                            ง414
Paint Formulating                                                            ง446.
Paving and Roofing Materials                                                  ง443
Petroleum Refining                                                           ง419
Pharmaceutical Manufacturing                                                 ง439
Phosphate Manufacturing                                                     ง422
Photographic Processing                                                  .     ง459

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                                         B-26
                                EXHIBIT B-5-3 (continued)

                 INDUSTRIES WITH PARTICULAR EFFLUENT GUIDELINES
                    AND STANDARDS UNDER THE CLEAN WATER ACT
                 Industry
                                                                 Reference in 40 CFR
Plastics Molding and Forming
Porcelain Enameling
Pulp, Paper and Paper Board
Rubber Processing
Soaps and Detergents
Stream Electric Power Generating
Sugar Processing
Textiles
Timber Products
 ง463
 ง466
 ง430
 ง428
 ง417
•ง423
 ง409
 ง410
 ง429
SOURCE: 40 CFR.

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                                                B-27
 B.6 OCCUPATIONAL SAFETY AND HEALTH ACT (OSHA)

       The Occupational Safety and Health Act (OSHA), developed under the Department of Labor, was
 written to preserve employee health and safety in the workplace.  OSHA was enacted under P.L. 91-596,
 December 29,1970, and was amended by Public Law (PX.) 93-237, January 2,1974, P.L. 95-251, March 27,
 1978,  P.L. 97-375, December 21, 1982^  and P.L. 98-620, November 8, 1984.  The act assures safe and
 healthful working conditions  for working men and women by authorizing enforcement of the standards
 developed under the act; by assisting and encouraging the States in their efforts to assure safe' and healthful
 working  conditions;  by providing for  research,  information, education, and training  in  the field of
 occupational safety and health; and for other purposes.

       OSHA regulations occur in Title 29  of the Code of Federal Regulations in Parts 1900 to 1999.
 These Parts include regulation on all employee-related provisions, many of which are unrelated  to (and
 unaffected by) hazardous materials manufacturing, processing, repackaging, release, handling, or  storage.
 The OSHA regulatory requirements outlined in this  appendix-concern only general and chemical-related
 occupational/safety and health provisions.  Many of the specific cost creating requirements  can be found
 in Title 29 CFR Parts 1904 and 1910.
                      •               '          '           '. '                   \
       Exhibit B-6-1  presents specific requirements associated with particular types of requirements that
 might create costs at your facility.  For example, notification costs under OSHA are driven by the specific
 notification requirements found in Sections 1910.1200(g)(8) and those associated with the chemical-specific
 requirements for chemicals  listed in Exhibit  B-6-2.                         ;

       The special chemical requirements in OSHA include 30 chemicals and chemical types (see Exhibit
 B-6-2).  The additional requirements for these substances can be very extensive (for instance, requiring that
 a closed or isolated system  be constructed for 4^Nitrobiphenyl) but usually fall within the same regulatory
 cost categories as the previous regulatory costs.  These 30 chemical and chemical types are not included in
 the cost  protocol due to their specificity. If you  have any of these species, you  can quantify any reducible
 costs  by understanding the  additional requirements imposed on your facility. Exhibit B-6-2 presents the
 chemicals/chemical types that have special provisions in OSHA and their section location in Title 29 of the
 Code of Federal Regulations.

       Finally, you should note that you are required, according to ง1904.10 of 29 CFR, to comply with any
 State  plans  that are in  place.  These  plans can not be less stringent than  the federal  requirements.
 However, they can be a source of even  more requirements.  You should remain aware of any additional
 requirements imposed locally.

 B.6.1  Notification

 •     ง1910.1200  (g)(8)  You must maintain copies of the required material safety data sheets (MSDSs)
                    for each hazardous chemical in the workplace readily available to employees during each
                    work shift.

-••..•              There are notification requirements associated with the constituents located in Exhibit
                    B-6-2 that may be reduced if the material is removed from usage and handling at your
                    facility.                      '  ,  .   .

 B.6.2 Reporting '„,.

 •      ง1904.4      You must make available a  record of all injuries and illnesses having occurred at the
                    site upon the occurrence of an incident                              ;

 •      ง1904.5      You must post  an annual summary of occupational injuries and illnesses  for each
                    establishment                                                           t *

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                                               B-28
•     ง1904.8      You must, within 48 hours of the occurrence of an employment accident which is fatal
                   to one or more employees or which results  in the hospitalization of one or more
                   employees, report the incident.

•     ง1904.21  •   You must, upon receipt of an Occupational Injuries and Illnesses Survey Form, fill it
                   out and return it                     .

•     ง1904.15     Companies with less than 10 employees are exempt from ง1904 except for the previous
                   three requirements, Le., งง1904.5, 1904.8, and 1904.21.

•     ง1904.16     Establishments in SICs 52-89 (excluding 52-54, 70, 75, 76, 79, and 80) are exempt from
                   part 1904 except for the previous three requirements:  งง1904.5, 1904.8, and  1904.21.

•                  There are additional reporting requirements associated with the constituents located in
                   Exhibit 1-2 that  may be reduced if the material is removed from usage and handling
                   at your facility.

B.63 Monitoring/Testing

•                  There are monitoring requirements associated with the constituents located in Exhibit
                   B-6-2 that may be reduced if the material is removed from usage and handling at your
                   facility.
B.6.4
Recordkeeping

ง1904.2      You must

ง1904.6
                                   '" a log and summary of occupational injuries and illnesses.
       ง1904.7
You must keep the records specified in งง1904.2, .4, and 5 for a period of five years
following the end of the year to which they relate.

You must  provide, upon  request, the records  specified in  งง1904.2, .4, and .5  for
inspection and copying by authorized officials.
•      ง1910.120   (o)(2)   An  accurate record  of the medical surveillance program must be  kept.
                   Information to be kept includes name and social security number of the employee, the
                   physician's written opinions, employee medical  complaints,  and  a  copy  of the
                   information provided to the examining physician.

•                  There are additional recordkeeping  requirements  associated with the constituents
                   located in Exhibit B-6-2 that may be reduced if the material is removed from usage and
                   handling at your facility.

B.6.5  Planning/Studies/Modeling

•      ง1910.1200  (e)    You are required  to have a written hazard communication program, available
                   to employees, their designated representatives, and authorized officials.

•      ง191038    You must develop an emergency action plan.

•      ง1910.120   (o)(3) A safety and health program must be developed and implemented for employees
                   involved in hazardous waste operations. The program must be designed  to identify,
                   evaluate, and control safety and health hazards in  their facilities for the  purpose of
                   employee protection.

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                                               B-29
      ง1910.120
      ง1910.120
B.6.6 Training

•    .ง1910.1200
      ง1910.120
B.6.7  Inspections
B.6.8  Labeling
 (1)    An emergency  response  plan must also be  developed and implemented by
 employers to handle anticipated emergencies prior to the commencement of hazardous
 waste operations.

 (o)(4) A decontamination procedure must be developed, communicated to employees
 and implemented before any employees or equipment may enter areas on site where
 potential for exposure to hazardous substances exist (r,ee ง1910.120(k)).

There are additional planning requirements.associated with the substances located in
 Exhibit B-6-2 that may be reduced if the material is removed from usage and handling
 at your facility.
 (h)    You must supply your employees with information and training on hazardous
 chemicals in their work area upon  initial assignment, and  upon addition of a new
 hazard.   '                                                                .  •   .

 (o)(5) A training program must be developed and implemented for employees involved
 with hazardous waste operations.  Initial training must be for 24 hours and refresher
 training must be 8 hours  annually.  .

 There are  additional training requirements associated with the substances located  in
 Exhibit B-6-2 that may be reduced if the material is removed from usage and handling
 at your facility.                                   ^
                   There are inspection requirements associated with the constituents located in Exhibit
                   B-6-2 that may be reduced if the material is removed from usage and handling at your
                   facility.
•     งง1910.1200 (f)(4)-(8)  You must label each container of hazardous chemicals in the workplace with
                   the appropriate information.

•                  There are additional labeling requirements associated with the substances located in
                   Exhibit B-6-2 that may be reduced if the material is removed from usage and handling
                   at your facility.               "                     ,               :          -
               - -    \             •                    i        •
B.6.9 Preparedness and Protective Equipment

•     ง1910.1000   An Employee's  exposure to  many substances is restricted by substances level  and
                   duration of exposure - see tables Z-l, Z-2, and Z-3 in 29 CFR, Part 1910, Subpart Z.

•                  There are additional requirements (i.e., isolated or closed  chemical systems, clothing,
                   restricted areas, washing and showering facilities, equipment maintenance, breathing
                   apparatus, etc) associated with the substances located in  Exhibit B-6-2 that may be
                   reduced if the material is removed from usage and handling at your facility.
       t   •  •                    '                                    '      .                      .
B.6.10 Medical Surveillance

*     ง1910.120    (o)(2)  A medical surveillance program must be instituted for all employees exposed
                   to hazardous substances or health hazards above permissible limits for 30 days or more
                   a year, as well as for those on respirators for 30 days or more a year and all hazardous

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                           B-30
materials (HAZMAT) employees.  Medical examinations and consultations must be
made available to employees eveiy 12 months, as well as prior to and at the termination
of employement (see ง1910.120(f)).

There are medical surveillance requirements associated with the  substances located in
Exhibit B-6-2 that may be reduced if the "material is removed from usage and handling
at your facility.

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                                             P-31
                                        EXHIBIT B-6-1                   .
                  REGULATORY COSTS UNDER THE OCCUPATIONAL SAFETY
                                  AND HEALTH ACT (OSHA)
         Type of Requirement
    Specific Requirement in 29 CFR a/
Notification
Reporting
Monitoring/Testing
Recordkeeping
Planning/Studies/Modeling        ,
Training
Inspections
Manifesting
Labeling
Preparedness and Protective Equipment
Closure/Post-Closure assurance
Medical Surveillance
Insurance and Special Taxes
 ง1910.1200(g)(8) b/ ... '   .    •  "' •
 ง1904.4, ง1904.5, ง1904.8, ง1904.21 by
 NAb/
 ง1904.2, ง1904:6, ง1904.7, ง1910.120(o)(2) b/
 ง191038, ง1910.1200(6), ง1910,120(o)(3),(4) b/
 ง1910.1200(h), ง1910.120(o)(5) b/
 NAb/
'•NA ;               _.',.'    -...--
 ง1910.1200(i)(4).(8) b/
 ง1910.1000, ง1910.1200(g)(8) b/
 NA   ,.    -  .  ..."  "
 ง1910.i20(o)(2) b/
 NA
NA = Not Applicable; i.e., no general (i.e^ not chemical-related) requirements apply to this cost category.
a/     These regulatory cites cover only OSHA provisions concerning chemical-related occupational safety
       and health.
b/     Chemical-specific requirements apply (see Exhibit B-6-2).

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                                             B-32
                                        EXHIBIT B-6-2

                    OSHA CHEMICALS AND ASSOCIATED REQUIREMENTS
             Cherrical/Chemical Type
Reference in 29 CFR
 l,2-dibromo-3-chloropropane
 2-acetylaminofluorene
 3,3'-dichlorobenzidine
 4-aminediphenyl
 4-dimethylaminoazobenzene
 4-nitrobiphenyl
 Acetylene
 Alpha-naphthylamine
 Asbestos

 Benzidine
 Beta-naphthylamine
 Beta-propiolactone
. Bis-chloromethyl Ether
 Coke Oven Emissions
 Cotton Dust
 Dip Tanks Containing Flammable and Combustible Liquids
 Ethyleneimine
 Explosives and Blasting Agents
 Flammable and Combustible Materials
 Hydrogen
 Inorganic Arsenic
 Lead
 Methyl Chloromethyl Ether
 Nitrous Oxide
 N-nitrosodimethylamine
 Oxygen
 Spray Finishing Using Flammable and Combustible Materials
 Storage and Handling of Anhydrous Ammonia
 Storage and Handling of Liquefied Petroleum Gasses
 Vinyl Chloride
     ง1910.1044
     ง1910.1014
     ง1910.1007
     ง1910.1011
     ง1910-1015
     ง1910.1003
     ง1910.102
     ง1910.1004
     ง1910.1001,
     ง1910.1101
     ง1910.1010
     ง1910.1009
     ง1910.1013 •
     ง1910.1008
     ง1910.1029
     ง1910.1043
     ง1910.108
     ง1910.1012
     ง1910.109
     ง1910.106
     ง1910.103
     ง1910.1018
     ง1910.1025
     ง1910.1006
     ง1910.105
     ง1910.1016
     ง1910.104
     ง1910.107
     ง1910.111
     ง1910.110
     ง1910.1017
 SOURCE:  29 CFR

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     APPENDIX C
   1
FUTURE LIABILITY COSTS

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                                           APPENDIX C

                                    FUTURE LIABILITY COSTS


      This appendix presents the cost calculation sheets for estimating future liabilities. Estimating future
liability costs is judgmental in nature.  You are encouraged  to be conservative in  your estimates thus
reflecting your emphasis on PP as a goal and not profit maximization. Your estimates of future liability
costs will reflect subjective corporate policy and not precise scientific calculations.

      To illustrate the concept of timing and magnitude of future  liability costs, this appendix presents a
number of cost equations.  All the cost equations are based on a  number of implicit assumptions which
are not spelled  out in this manual.  Some  of these assumptions  may not be applicable to  your firm.
Furthermore, because  the timing and magnitude of liability costs are inherently uncertain, they are best
represented by probability distributions  (i.e.,  likelihood of various  levels  of costs at various times in the
future) and not  by single point estimates as presented in this appendix.  Simple cost equations thus may
not represent accurately the potential for liability costs associated with waste management at your firm. For
these reasons, you should not use the numbers  and equations presented in this appendix without detailed
analysis and scrutiny.

      Future liability  (FL) costs can attach to  both  the current practice and the PP alternative.  Future
liability costs are strictly equal to zero if  and  only  if your company generates no hazardous waste and
releases no hazardous materials.  Opportunities  for future liabilities can arise from non-permitted potential'
releases as well as permitted releases. This appendix outlines methods for calculating the potential liabilities
associated with the following waste management activities:

       •      Treatment  or storage'in tanks;
       •      Transportation; and
       •      Land disposal (on-site or off-site)..

      There are seven types  of  future liability costs that  are potentially associated with each waste or
materials management activity:

       FL1:  Soil and waste removal and treatment         .                    ,
       FL2:  Ground-water removal and treatment
       FL3:  Surface sealing
       FL4:  Personal injury
       FL5:  Economic loss             '   -
       FL6:  Real property damage
       FL7:  Natural resource damage.                         N                            '

       This appendix suggests the form of the cost  equation for estimating future liability of each type.
While the cost equation basically has the same form across waste management activities for a given liability
type, the values of the parameters entering  in the cost equation  may vary from one waste management
activity to another.  Exhibits C-l to C-7 contain the equations and management-specific parameter values
for estimating FL1 through FL7, respectively.   For example, Exhibit C-l suggests the form of the equation
for estimating the costs of soil arid waste removal and treatment Exhibit C-l also suggests values or ranges
of values for the parameters of the cost equation for tanks and transportation separately (there are no costs
for soil and waste removal and treatment  for landfill disposal). Exhibit  C-8 illustrates the calculation of
the year when liabilities are expected to be incurred, i.e., the first year of cash flow;                -   •

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                                                C-2
                                           EXHIBIT C-l

                         SOIL AND WASTE REMOVAL AND TREATMENT
                                   (FL1, in thousands of dollars)

                                       FL1 =: 8.9 x a x b x Q

       FL1 gives the general equation for estimating the costs of soil and waste removal and treatment
This same equation applies to potential releases from tanks and transportation (this cost is not applicable
to landfill disposal). However, you will need to select different values of the parameters a, b, and Q (as
provided below) depending on the waste management practice analyzed.  For example, if you are analyzing
the costs  of soil and waste removal and treatment associated with storage in underground tanks, you will
set a equal to 2, select a value of b between 0.0001 and 0.1, and set Q equal to the total annual quantity
of waste stored in tanks.                      •
Tanks;

a =  correction factor
  —  2 (if underground)
  =  1 (if above ground),

b =  fraction of the total annual quantity (treated or stored in tanks) expected to be released
  =  0.0001 to  0.1 depending on the type of tank (above ground  or under ground; carbon,  concrete,
      stainless, or fiberglass)                                         .

Q SB  total quantity of waste treated or stored in tank (kgal/yr)


Transportation;
b =   fraction of the annual quantity (transported) expected to be released
  ซ   9.5x10-* x D + 7.6xlO"* (tanker truck for bulk liquids)
  ป   2.4xlff6 x D -f 2.9x10^ (flatbed truck for drums)

D SB   distance to treatment or disposal facility (miles)

Q =   total quantity of waste  transported (kgal/yr)


Landfill Disposal;

Not Applicable:     Because landfills contain a large volume of waste and excavation costs are very high,
                   excavation is unlikely to be the preferred option for remediating a leaking landfill
                   Leaking landfills result in costs for pumping arid treating ground water (see Exhibit C-
                   2).

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                                               C-3
                                          EXHIBIT C-2                    '
                                                         *          '           --•--,

                         GROUND-WATER REMOVAL AND. TREATMENT
                                   (FL2, in thousands of dollars)                          .......

                                       FL2 = a  •ป- (bx'c)

      FL2 gives the general equation for estimating the costs of ground-water removal and treatment
This same equation applies to potential releases from tanks and landfill disposal (this cost does not apply
to transportation practices because releases during transportation generally do not result, in ground-water
contamination).  The values of a and c are given below as a function Of other parameters whose values
depend on the waste management practice considered.
                                                     '          '                 ,;           . " •
a =  capital costs               ,
  =  91 + [(0-25 x D x W) + 0.08 D2 '+ 137 W * 91 D +
            (0.015 x CC x V x W) -+ (0.005 x CC x V x D)] / 1,000

b =  O&M cost
  =  92 + [11 W 4- 8 D + (0.015 x OM x V x W) +  (0.005 x OM x V x D)] / 1,000

D =  distance to nearest drinking water well (meters)                                '  '   j, "  ' ' '
  =  150m to 3^00 m                          '

W = , width of ground-water plume at facility boundary (meters)

V=  ground-water velocity (meters/year)
  =  30 m/yr to 3,000 rn^yr

CC = unit capital cost of ground-water treatment (S/cubic meter/day)

OM = unit operating and maintenance cost of ground-water treatment
      (($#ear/)/(cubic meter/day))

Tanks;

c  =  multiplicative factor to determine present value of all O&M costs
   =  4 to8                    ;

CC = 440 S/m3/day                       .
OM =120 T$/year)/(m5/day)

W = 3m to 10pm

Transportation:

Not Applicable

Landfill Disposal;

c  =_  5 to 25                                       .  '                                 .

CC = 340 $/m5/day
OM =85
 W=  500m to 700m

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                                              C-4
                                          EXHIBIT C-3                    .

                                      SURFACE SEALING
                                  (FL3, in thousands of dollars)

                                         FL3 = CS x A-

      FL2 gives the general equation for estimating the  costs of surface sealing.  This cost applies to
landfill disposal and not to tanks and transportation.  CS and A are given below.
Tanks and Transportation;

Not Applicable

Landfill Disposal;

CS - unit cost of surface sealing landfills (kS/acre)
  ^  7 to 46 k$/acre

A =  area of the landfill (acres)
  ป  65  to 150 acres

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                                                 C-5
                                            EXHIBIT C-4                              ,

                                        PERSONAL INJURY
                                 '   (FL4, in thousands of dollars)

                                            FL4 = a x b

.'• -    FL4 gives.the general equation for  estimating the costs of personal injury.  This same equation
 applies to potential releases from tanks and  landfill disposal (this cost does not apply to transportation
 practices).  Potential values of a and b are given below.


 Tanks or Landfill Disposal;            •                                    .1
                                                           •               .                .  v '•••.-•
 a =   average claim per person for lost time due to disability and mortality, medical costs related to illness,
       and medical monitoring costs                                                    •
  =   $56,000 per person (default value)                   • '  •   •   v             • '  ,  .

 b =   potentially affected population
  =   15,000 (worst case default value)
  =    3,500 (typical case default value)
  =      10 (best case default value)                               .               ,

 Transportation;                                                                        •

 Not Apph'cable

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                                               C-6
                                           EXHIBIT C-5

                                        ECONOMIC LOSS
                                    (FL5, in thousands of dollars)

                             FL5 = cost to replace a water- supply source


 Tanks and landfill Disposal;

       As a first approximation, ELS may be assumed to be a strict function of the size of the population
 served.  In reality, the cost to replace a water supply source varies with many other parameters such as
 distance to nearest alternative source of water, cost of purchasing water from an alternative source, etc.
                                   •  ••  •            .;           '               t

                                 Cost to Replace Water Supply Source 2
 Population Served	(Thousand 1986$)	_

      50-99                                  343          ;
     100-499                                  412
     500-999                                  617
   1,000-   2,499                               1.040
   2^00-   4,999                               1.812
   5,000-   9,999                               2,424
  10,000- 99,999                              10,443
 100,000-999,999                         .    51,747
 1,000,000 +                                  333,947


 Transportation!

 Not Applicable
    1 U.S. EPA, Technologies and Costs for the Removal of Fluoride from Potable Water Supplies," Final
Draft, July 1983, pp. 58-78.

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                                               C-7
                                          EXHIBIT C-6                   •

                                   REAL PROPERTY DAMAGE
                                   (FL6, in thousands of dollars)

                                         FL6 = a x bx'c

       FL6 gives the general equation for estimating the costs of property damage due to contamination of
 ground water underlying private property.  This same equation applies to potential releases from tanks and
 landfill disposal (this cost does not apply to transportation practices).  The values of a, b, and c are given
 below as a function of the width of the ground-water plume, W, which is a function of the management
 practice considered.


 a =   devaluation factor         .                                         .
       0.15 to 030
      -        .       "\      /..''•••'•'.         •."       '•        ••.:•-"•.•
 b =   land value (kS/acre)
       0.9 to 3.5

 c=   area of the off-site plume       \  •  •
  F   [033  D2 + p x W) - OJ W2] / 4047

 D=  distance to nearest drinking water well (meters)
       150 m to 3200m                                .

 W =  width of ground-water plume at facility boundary (meters)


 Tanks;             ,                v
                                              "          *       tr   ' •                 "
 W as  3 m to  100 m
Transportation;

Not Applicable


Landfill Disposal;

W = 500 m to 700 m

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                                               C-3
                                           EXHIBIT C-7

                                 NATURAL RESOURCE DAMAGE
                                   (FL7, in thousands of dollars)

                                           FL7 = a x b

      EL7  gives the  general  equation  for  estimating the costs of natural resource damage  due to
contamination of surface water.  This same equation applies to potential releas.es from tanks, transportation,
and landfill disposal.   The values of a and b are given below as a function of the management practice
considered.


a =   the unit cost of dredging and disposing of contaminated material plus the cost of fish  killed (k$/acre)

b ซซ"  area of surface water contaminated (acres)

                       •''                   '                          '
Tanks and Landfill Disposal;
                                      /                           '  :            '
as   692 (default value, 1986 kS)                                            .

b =  1 acres to 3 acres


Transportation!

as   692 (default value, 1986 kS)

b s  1 x d to 3 x d (default values)                                               ,

d =  quantity expected to be  released, expressed as a fraction of the annual quantity transported
  s   0.5xl(T* x D + 7.6XKT*5 (tanker truck for bulk liquids)
  ป   2.4xl(T(5 x D + 2.9XKT* (flatbed truck for drums)

D **  distance to treatment or disposal facility (miles)

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                                               C-9
                                          EXmBIT C-8                  •

                   EXPECTED YEAR IN WHICH LIABILJTIES ARE INCURRED

                                    Year = Time + (D x KF)/V


Time =     the ejcpected time lapse between the start of the project and the initial release (years) (range
            from one to twenty years)                      .                 ,
                                    i       ,                  • '~ ^.         '     ,
D=  distance to the nearest drinking water well (meters)
  =   150 (worst case default value)
  SB   1,500 (typical case default value)
  =   3,200 (best case default value)

RF = retardation factor for waste constituents (range from 1 to 1,000)

V =  the:ground-water velocity (rn^r)                                       "
  =   3,000 (worst case default value)
  =,  300 (typical case default value)
  =   30 (best case default value)

Tanks;

Time =     1 to 20 years

Transportation;                                                  *

Time =  1

D =  0    -;      :.::   .          '  .   ' ':   ._.•."         . ,   .            '••'   ";:   .  '-

Landfill Disposal:         •


Time =    1 to 40 years

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        APPENDIX D
                 •  f


HYPOTHETICAL FIRM EXAMPLE

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                                            APPENDIX D

                                 HYPOTHETICAL FIRM EXAMPLE        .


       This appendix illustrates the use of the manual with a hypothetical firm example.  This analysis is
 presented to demonstrate:

     ,  (1)   the mechanics of the cost and financial protocols; and

       (2)   the  usefulness of the results; for evaluating the economic feasibility  of PP
             projects.                .

 The example calculations presented are only  meant to be  illustrative of the manual's use. Furthermore,
 these calculations are limited in general to the types of costs  identified in this Phase II Manual.  In all
 worksheets (in this appendix as well as in the entire manual),  positive cash flows correspond to cash inflow
 (i.e., the firm makes money) and negative cash flows correspond to cash outflow ,(Le., the firm loses money).
 This rule does not apply in the cost tables of Tier 0 (usual costs, Exhibit D-2), Tier 1 (hidden regulatory
 costs, Exhibit D-4) and Tier 2 (future liability costs, Exhibit D-5); because these cost tables are used to
 estimate costs only (i.e., dollars out), all costs  are represented as positive numbers for  convenience. When
 reporting cost numbers from the cost tables to the worksheets, the hypothetical user is very careful to place
 a minus sign (-) before all cost estimates (i.e., cash outflow)

       This appendix is organized in six sections.  Section  D.I introduces the hypothetical firm's current
 practice and PP alternative.  Section D.2 presents the "standard" or usual (Tier 0) calculations for evaluating
 the economic feasibility of  the PP alternative. Sections D3  through D.5 present the Tier 1, Tier 2, and
 Tier 3  calculations,  respectively.  Section D.6 presents  a  summary of the  calculations done by  the
 hypothetical firms.  The worksheets completed by the hypothetical user are attached at the end of this
 appendix as well as in separate form to faciu'titate going back and forth between the text of this appendix
 and  the numbers presented in the worksheets.


 D.1   PRESENTATION OF HYPOTHETICAL FIRM                      "

      The hypothetical firm, Auric Jewelry Inc. (AJI), owned by J.F. Auric, is  a participant in the metal
 finishing industry (SIC 3910) and is a producer of gold-electroplated jewelry. AJI has annual revenues of
 $10 million per year and employs 40 people.  The firm has been in the plating business for two decades
 and has continued to be profitable.  The company operates a single plating facility that is located  in an
 industrial park  on the outskirts of a  large  city.   Exhibit D-l summarizes the characteristics of waste
 management practices under the current practice and the PP  alternative.

      Description of Current Practice

      The electroplating process used by AJI plates gold onto a nickel base. Before entering the plating
 operation, the metal settings to be plated are precleaned at room temperature (i.e., cold cleaned) with the
 chlorinated solvent 1,1,1-trichlorOethane (TCA) in an open top vapor degreaser.

      The AJI  gold plating bath is maintained indefinitely  by protection  from contamination  through
 continuous filtration, and by replenishment of the depleted  plating chemicals. After plating, the parts are
 dipped in two consecutive still rinse baths (rinse baths that are not supplied with a continuous stream of
water), and then a running rinse bath.  Dragout is minimized using  standard good housekeeping practices
 (e.g., hanging parts over tanks). Because gold, cyanide, and other contaminants accumulate in the still bath
 rinsewater, the rinsewater can be recycled to the plating baths, and the cyanide (or more importantly for
 Mr. Auric, the gold) can be recovered.  Furthermore, because the rinse in the still bath captures most of
 the cyanide, the  cyanide level of the running rinsewaters .is low enough to allow the Stream to be discharged
 to a  POTW (Publically-Owned Treatment Works).

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                                               D-2
                             .             EXHIBIT D-l

                   SUMMARY OF CURRENT AND ALTERNATIVE PRACTICES
            Current Practice
                                                                       PP Alternative
1,1,1-Trichloroethane  used  in  the  precleaning
process. Spent solvents from the precleaning step
(2,100 Ib/month, F002 waste) are shipped off-site
to solvent reclamation facility. Still bottoms from
reclaimer  incinerated and ashes are landfilled.

No other  precleaning effluent
Cyanide-gold electroplating  bath is continuously
filtered to be indefinitely maintained, but would
be an F007 waste if disposed.

Filtrate from the plating bath (<100 kilograms
per  month   of  F008  waste) is generated and
disposed as a hazardous waste.

Rinsewater from the  electroplating process, also
an F007 waste, is discharged to local POTW.
Aqueous alkali cleaning process is used.  The
spent cleaner is  taken back by the  vendor at
system maintenance.
Additional rinsewater  (ultimately  discharged to
local POTW)  is  produced in the  precleaning
process upon exiting the cleaning step.

Cyanide-gold  bath  is  unchanged  in  the  PP
alternative.
 Filtrate is unchanged in the PP alternative, but is
 not  disposed  as  hazardous  waste  due   to
 elimination of large quantity generator status.

 Rinsewater production and handling unchanged in
 PP alternative.

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                                                 D-3
        Characteristics of Waste Streams
    . •  •      .                 • •      •        .  .      -  -   •                    •             . v
        The firm uses 60,000 pounds of solvents  per year for the precleaning operation.  Despite practices
  to minimize evaporation,  a large proportion (58 percent) of the solvents is lost to evaporation.  The
  remaining 42  percent becomes spent solvents  containing 1,1,1-trichloroethane (TCA) with 10 percent
  suspended solids and 5 ppm  nickel. The facility therefore generates about 2,100 pounds per month of
  spent TCA (2,100 Ibs/mo = 0.42 x 60,000 ibsyyr '+ 12 mo/yf) or about 2^50 gallons per year (at a density
  of 10.7  pounds per gallon).  Under the Resource Conservation arid Recovery Act (RCRA) directives
  regulating the  disposal of hazardous waste, TCA is a "listed" F002 waste and, therefore, AJI is a hazardous
  waste generator.           ,                                          .

        The filters on the gold plating bath are changed biweekly and sent off-site for reclamation  of gold
  and possible filter reuse. The generated filtrate amounts to just below 100 kilograms per month (i.e., about
  200 pounds). The filtrate is also a listed waste under RCRA (F008).  Since the facility generates more than
  liOOO kilograms or 2^20 pounds per month of hazardous waste (2,100,lbs of F002 waste plus about 200 Ibs
  of F008 waste), AJI is classified as a large quantity hazardous waste generator.

        The plating bath (if it were riot indefinitely maintained)  and  any rinsewaters generated in the process,
  would be considered RCRA F007 wastes, if disposed of as solid wastes. However, since they are discharged
  to a POTW, they fall under  the jurisdiction of the Clean Water  Act (CWA).  As mentioned above, the
  cyanide  level (the only constituent of concern in the rinsewater waste  stream) is low enough-to allow
  rinsewater discharge without  pretreatment.       .
     •       '               -     '     '-               ,          . . S           \   : -~     '
        Waste Management Practices

        There are two hazardous waste streams  disposed in the current practice, the spent solvent (2,100
  Ibs/m'o)  and the plating bath filtrate (200 Ibs/mo).  The spent solvent waste stream is temporarily stored on
  site in an above ground tank  with a 600-gallon capacity.  At least  once every 90 days, the tank is emptied,
  and the waste is manifested,  picked-up, and transported off site in a tank truck by a solvent reclamation
  facility.2 The  solvent recycler reclaims the solvent through a  distillation process.  The still bottoms from
  this process are still classified as an F002 waste and must be dealt with further by the reclamation facility,
  these bottoms are  incinerated to  meet the land disposal  restrictions  and the ashes landfilled.   The
  reclamation facility has the distillation process, incinerator, and landfill on site.

        The filtrate is placed in a drum, also sent off site at least once every 90  days. The drum is stored
  in a secure area and is kept  closed except when adding  the filtrate.  The solvent reclamation facility also
  takes this waste and places it in its landfiU after incineration.

        Description of Alternative Practice

        Following  the procedures of the EPA Waste Minimization  Opportunity Assessment Manual, the
  operating personnel of this facility  have conducted a waste minimization audit and  proposed  a PP
  alternative.    The PP  alternative  chosen  is  characterized  as source  reduction  through  raw  material
  substitution. This proposed  project entails  the replacement  of the chlorinated solvent precleaner with a
  conveyorized,  aqueous based  spray-cleaning system. The proposed process equipment varies greatly from
  the batch solvent cleaner, and,  therefore, AJI must purchase new equipment  when substituting for the
  chlorinated solvent
         In the PP alternative, the only waste stream generated and disposed as a solid waste is the filtrate
  from the gold plating bath which, as mentioned previously, amounts to less than 100 kilograms per month.
    2 F002 solvent wastes are restricted from land disposal as explained in Appendix E.  Economics dictate
that the spent solvent be recycled off-site.

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                                               D-4
Again, the plating bath (indefinitely maintained) is not a source of waste; and any rinsewaters produced in
the process are discharged to a POTW and fall under the authority of the CWA,

       Upon  regular maintenance of the aqueous based cleaning  system, the producer of the aqueous
cleaning chemicals takes back the spent cleaning solution in order to recover some of the proprietary
chemicals used in the formulation.  Therefore, this waste is not disposed by AJI.  The additional rinsewaters
produced in the rinsing portion of the aqueous cleaning process are also discharged to the POTW.

       Waste Management Practices                                                  '

       In the alternative, the only hazardous waste stream is the filtrate.  However, since the quantity of
the waste stream is less than 100 kilograms per month, the facility is conditionally exempt under  federal
RCRA regulations and the filtrate may be disposed of as a non-hazardous waste.  Note, however, that the
facility could be regulated under certain state RCRA programs  (e.g., California has no small quantity
generator status).

       In addition,  preliminary engineering calculations  indicate  that the wastewater effluent from the
aqueous cleaning system will contain 2 percent suspended solids and 1 ppm nickel and can be discharged
to a POTW,  like the plating bath rinsewater  (without pretreatment).


D.2    TIER 0:  USUAL COSTS

       Mr. Auric decides to perform the Tier 0 analysis once for the current practice and once for  the PP
alternative.   That is, he chooses to calculate  the costs of the current practice and the PP alternative
separately. Alternatively, he could have chosen to estimate the difference in costs between the current and
alternative practices.

       D.2.1  Tier 0 Cost Calculations

       Mr. Auric summarizes his estimates of usual costs for the current and alternative practices in  Exhibit
D-2.  He then uses these estimates of Tier 0 cash flows to complete the middle blocks of one Worksheet
0 for current practice and another Worksheet 0 for the alternative practice.

       Mr. Auric Estimates Costs under the Current Practice
                                                            *
       Mr. Auric, who is the plant engineer as well as the plant owner, realizes  that the open top vapor
degreaser and other related process  equipment are very old and hve a market value of close to zero.
Therefore, he considers capital costs under the current practice as "sunk" costs, and therefore equal  to zero.

       The current practice operating expenses are comprised of raw material, maintenance, and disposal
costs.  The annual raw material cost for TCA is $45,000, based on purchasing 60,000 pounds at $0.75 per
pound. The solvent cleaner is serviced four times a year at a cost of $1,000 for parts and labor, for a total
annual maintenance cost of $4,000. The facility sells the spent solvents to an off-site reclaimer at 94 cents
per gallon (roughly 9 cents per pound);  hence a  total annual  revenue from sales of spent solvents (a by-
product)  equal to $2ฃ00 per year.

       Mr. Auric Estimates Costs under the Alternative Practice

       The vendor of the  equipment and materials  submits  a bid with quoted  capital costs for  the PP
alternative of $155,000. This includes $100,000 for the cleaning system, $40,000  for the dryer, and $1,500
to install the equipment  The lifetime of the cleaning system and dryer is 20 years.

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                     -•.      ••   -.     ,D-5   '   -     ••  -' '.



                           - :      EXHIBIT D-2

                     SUMMARY OF USUAL COST ESTIMATES
Cash Flow
Description
Current Practice
Capital Costs
Raw Materials
Maintenance
Item and Quantity .
i . •

NA
60,000 Ibs/yr of TCA
Servicing of solvent
Unit Cost

NA
$0.75/lb
@ $1,000
Cash Flow
Estimate

SO
$45,000 /yr
, $4,ooo yyr
                    cleaner 4 times a year

By-Product Revenues 2350 gal/yr of spent
                    TCA sold to recycler
                      $0.94/gal     $2^00 /yr
Alternative Practice

Capital Costs
         r1     . •



Raw Materials

Maintenance


Disposal





Energy
Cleaning System
Dryer
Installation

Water and Chemical

Servicing of Aqueous
cleaner 6 times a year

Permit fee for POTW
discharge of wastewater
effluent from aqueous
cleaning system

Electricity to  operate
conveyor and spraying
systems
NA
NA
NA
NA
@ $2,000
$100,000
$40,000
$1,500
$5,000 /yr
$12,000 /yr
NA
NA
$2,000/yr
$10,000 /yr

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                                               D-6
       The operating expenses for the PP project are comprised of raw material, maintenance, disposal, and
 energy costs.  The annual raw material cost includes  the cost of water and chemical cleaner for a total of
• about $5,000. The aqueous cleaner requires maintenance six times a year at a cost of $2,000 each time, for
 a total annual maintenance cost of $12,000. The annual disposal cost for the proposed project is $2,000;
 this cost represents  increased permit fee for POTW discharge of the effluent from the aqueous cleaning
 system.  The annual energy cost of this new  equipment is $10,000 of electricity charges to operate the
 conveyor and spraying systems.  The PP project will  not affect the labor costs of the facility.

       Mr. Auric Completes the Middle Blocks of Two Tier 0 Worksheets

       The first step in analyzing the economic benefits  of the PP alternative is to  complete the cost
 worksheets for Tier 0.  Mr. Auric has chosen to complete one Worksheet 0 for the current practice and
 one Worksheet 0 for the PP alternative.  Alternatively, Mr. Auric could have chosen to complete only one
 Worksheet 0 by focusing on the difference in  costs between the  current and alternative practices.

       Mr. Auric first checks the •Current Practice* box in the upper right corner of one Worksheet 0 (page
 D-31); he  will use that worksheet for the current practice. Likewise, he checks the "Alternative Practice"
 box in the upper right corner of another blank Worksheet  0  (page D-32) which he will use for the
 alternative practice.

       Mr. Auric then copies the cash flow estimates for the current and alternative practices from Exhibit
 D-2 into the appropriate columns of the two worksheets. For example, Exhibit D-2 indicates raw materials
 costs of $45,000 per year under the current practice. Hence, Mr. Auric writes -45 on the current practice
 Worksheet 0 in the  cash flow estimate column on line B8 (Raw Materials).  Note that Mr. Auric is careful
 to (1) convert the cash flow estimates in Exhibit D-2 into  units of thousands of dollars (e.g., 45 is $45,000
 divided by 1,000), and (2)  place the minus sign before cash flow estimates corresponding to cash outflow
 or money  spent (e.g., -45).

       The next step for Mr.  Auric is to complete the other middle-block columns  of the  two Tier 0
 worksheets; i.e., escalation, first year of cash flow, and lifetime of each cash flow item.  To keep the example
 as straightforward as possible, Mr. Auric assumes the same escalation rate (i.e., expected future inflation),
 same first year, and same lifetime for all cash flows.  Mr Auric assumes an escalation rate of 4 percent, a
 first  year  of cash flow of 0 (i.e., starting this year), and a lifetime of 20 years (i.e., lifetime of the PP
 equipment).  Taking advantage of this simplifying assumption  and of the fact that he does not have one-
 time expenses mixed with his recurrent expenses (see notes 1 and 2 below), Mr. Auric sums upward all cash
 flows within the  same category (i.e.,  expenses, operating revenues)  and writes the sum totals in  the
 approriate lines of the worksheets (e.g., -49 for expenses under the current practice, -29 for expenses under
 the alternative practice).

       In  general, you  may not sum cash flow estimates in the  middle block of a cost worksheet as Mr.
 Auric does in this example if

       (1)    You assign different values to either escalation, or first  year of cash flow, or
              lifetime for different cash flows  within the same  category (e.g., expenses).  For
              example, if you assign a higher escalation rate to  hazardous waste disposal costs
              than to energy costs, then you will need to keep those two cash flows separate
              for purposes of  the  financial calculations (i.e^ for completing  the right-hand
              block of Worksheet 0); or

       (2)   You have both  one-time expenses and recurring  expenses.  As explained in
              Exhibit  6-1  of Chapter 6 of this manual,  one-time expenses (line items Bl
              through B6) and recurring expenses (line items B7 through B14) are treated
              differently in the financial calculations and thus must be kept separate when
              completing the cost worksheets.  For example, if you have both a salvage value
              cash flow (line item  B3)  and a  labor cash flow (line item Bll), then you may

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                                               D-7
            , not sum the estimates of cash flows  associated with those  two items in  the
             middle block of Worksheet 0.                        .

       D.2.2  Tier 0 Financial Calculations                                            ' >'

       In order to perform the  financial analysis of the PP. project, Mr Auric assumes the following

       (1)    The minimum rate of return that he is willing to accept is 15 percent; Le.,  the
             hurdle rate or minimum acceptable rate of return to his firm is 15 percent; and

       (2)    The federal corporate tax rate is 34 percent and the state corporate tax rate is
             10 percent for a total corporate tax rate of 44 percent

With these two assumptions, and the results of the cost calculations (Le., escalation rate is 4 percent, first
year of cash flow is year 0 or 1989, lifetime is 20 years, and  cash flow estimate as calculated), Mr. Auric
is now equipped to apply the financial calculations described  in Chapter 6 of this  manual Following the
procedures described  in  Chapter 6, Mr, Auric completes first the right-hand blocks of the  two Tier 0
worksheets, then Worksheet IV for Tier 0, and finally Worksheet V for Tier 0.

       Mr. Auric Completes the Right-Hand Blocks of the Two Tier 0 Worksheets              •

       J.F. first completes the right-hand blocks of the two Tier 0 worksheets by annualizing the cash flows
of the middle block.   For that, he uses as appropriate Equations (6.1) through (6.5) and Exhibits 6-J
through 6-3 of Chapter 6.  For example, in Worksheet 0 for current practice, J.F.  calculates annualized
expenses for three values  of the discount rate (5%, 10%, and 15%). From the middle block, J.F. knows
that the current practice costs $49,000 a year in 1989.  Next year, the expenses associated with the current
practice will increase  due to inflation and will amount to  550,960  (Le., 1.04 x $49,000).  In the following
year, the expenses associated with the current practice will amount  to $53,000 (Le., 1.042 x $49,000 = 1.04
x $50,960). In year 2010 (Le., 20 years from now), these expenses are expected to increase to $107,400 due
to inflation (i.e., 1.0420 x $49,000).  The purpose of the annualization is to find the constant annual amount
that would have the same value  in  present  terms as this  stream of cash flows  just described.  The
calculation of this annualized cash flow requires that a factor,  referred to as the discount rate, be specified.
At a 5% discount rate, J.F. calculates the annualized expenses under current practice using Equation (6.1):

       Annualized Expenses =  PVF1 x AF x $49,000.                                      ,

Because all his expenses are of  the recurrent type (line items  B8 and B14, see Exhibit 6-1), PVF1 is given
by Equation (63):

       PVF1  = p*xPVF2

where

       p m (1 + re) / (1 + rd)  = (1 +  0.04) / ( 1 + 0.05) = 0.99 (Equation (6.5))

       t/= 0 (first year of cash flow); therefore pฐ  = 1            ^
           - •             •, v    -            '              " • '•              --          '
       PVF2  = (1 - p") / ( 1 - p)  = 183  (Equation (6.4) or Exhibit 6-2)

Therefore

       PVF1  = 1 x PVF2 = 183

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                                                D-8
        On the other hand, for a discount rate rd of 5 percent and a lifetime of 20 years, AF is equal to 0.08
 (see Exhibit 6-3).  Hence the annualized expenses under the current practice for a discount rate of 5%:

        Annualized Expenses =  183 x 0.08 x $49,000 = $71,900

 Mr  Auric writes this value (-71.9) in the Worksheet 0 for" current practice under the column V* = 5%."
 Using the same procedures, Mr. Auric calculates annualized cash flows for discount rate values of 5 percent,
 10 percent, and 15 percent for all cash flows estimated in the middle blocks of Worksheet 0 for the current
 practice and Worksheet 0 for the alternative practice. Note that the annualized cash flows decrease (in
 absolute terms) with higher values of the discount rate.5 For example, the annualized expenses under the
 current practice are -71.9, -712,  and -70.9 for rd values equal to 5 percent, 10 percent, and 15 percent,
 respectively  This is because as the discount rate increases, the present value of the stream of cash flows
 associated with each  cash flow item decreases.  That is, as the discount rate increases, future cash flows
 have less value in present terms.

        Mr. Auric Completes Worksheet IV for Tier 0

        Having completed the two Tier 0 worksheets, Mr. Auric now takes a blank Worksheet IV and writes
 0 in the tier box in the upper right corner to indicate that he is doing the Tier 0 analysis.  Mr. Aunc wiU
 use Worksheet  IV to summarize the annualized cash flow results.  He copies the annualized capital
 expenditures, expenses, and operating revenues from lines A, B, and C of the two Tier 0 worksheets on the
 corSpondingTb, and c lines of Worksheet IV. For example, he copies -71.9, -71.2, and -70.9 on line b
 (expenses) of the current box of Worksheet IV. As discussed in Chapter 6, Step 2, Mr. Aunc would not
 have had to complete Worksheet IV if he had chosen to  perform the Tier 0 analysis incrementally.

        Mr. Auric Completes Worksheet V for Tier 0

        Having completed Worksheet IV, Mr. Auric will now estimate the key financial indicators of the
  PP  project using a blank Worksheet V where he writes 0 in the Tier box in  the upper right corner.
  Following the procedures described  in Step 3 of Chapter  6, he first calculates the incremental annualized
  cash  flows;  i/, the difference  between the annualized  cash flows under the  PP alternative and  the
  annualized cash flows under the current practice as summarized in Worksheet IV, Tier 0.  For example, Mr.
  Auric calculates incremental expenses of 29.4 (i.e.,  -42.6 -(-71.9)) for a discount rate value of 5 percent.

         Mr. Auric then calculates the tax liabilities of the PP alternative relative to the current practice using
  Equation (6.7) of Chapter 6:

         Incremental Tax Liability = - r, x [(FD x a)  + b +  c + e]

  where r. is  the corporate tax  rate (federal plus state, equal to 44 percent for Mr. Auric) and FD  is a
  depreciation factor given by Equation (6.8) or Exhibit 6-4  as a function of the discount rate id.  For  id
  equal to 10 percent, for example, FD is equal to 0.72 and the tax liability is -$4,500 per year since

         - 4.5 = - 0.44 x [(0.6274  x -24.8) + 28.9 -3.2 + 0]

  Under the PP project, Mr. Auric would pay $4,500 worth  of taxes more than under the current practice
  assuming a discount rate of 10 percent
     3 Due to rounding, the annualized operating revenues under the current practice appear to remain
constant (equal to 3.2) as the .discount rate varies.  In reality, these annualized operating revenues do
•decrease as the discount rate increases.

-------
                                               D-9
      Mr.  Auric then computes the net annualized savings at  Tier  0 by adding lines a through  f of
Worksheet V.  For example, the net annualized savnigs for a 5 percent discount rate is equal to $6,800
since  '     -.'       ^  '  •         .  .•-        '    '       '        ....-•   •  '     •      .-.-.'

      6.8 =  - 12.4 + 29,4 - 3.2 - 6.9                   •

This means that if Mr. Auric was willing to accept a return on his investment equal to 5 percent, the PP
alternative would seem accpetable since it would save an equivalent amount of $6,800 annually.  However,
Mr. Auric has determined upfront that he would not invest in the PP project unless it gave a return on his
money of at least 15 percent  As Worksheet V indicates, at a discount rate of 15 percent, the PP project
loses an estimated $3,500 annually compared to the current practice and therefore is not cost-justified.

      Mr.  Auric reaches the same conclusion by estimating the Internal Rate of Return (IRR) of his PP
project at Tier 0.  The IRR is the discount rate value that results in total annualized savings equal to SO.
Mr. Auric repeats  the previous calculations iterating 14 in order to determine the internal rate of return
(IRR).  He estimates that the IRR of the PP alternative relative to the current practice is  equal to 12
percent and confirms that the alternative, at this level of examination, is not economically justified given
his firm's minimum acceptable rate of return of 15 percent

      Because Mr. Auric is keenly aware of his paperwork, reporting,  and other regulatory requirements,
and because the project is close (12% vs. 15%), he decides to pursue the analysis a bit further.  Also, Mr.
Auric decides to perform the Tiers 1, 2, and 3 analyses on an "incremental" basis  because he  feels he can
better estimate these cash flows incrementally rather  than  separately for  the current practice and PP
alternative.  Therefore, he will use only one Worksheet I, one Worksheet II, and one Worksheet ni and
check the "Incremental" box in those worksheets.
DJ  TIER 1:  HIDDEN REGULATORY COSTS

      D.3.1 Tier 1 Cost Calculations

      Mr. Auric uses the Tier 1 protocol incrementally to more accurately estimate the "true" cost of his
current practice.  In a first step, Mr. Auric fills out the regulatory status questionnaire to reflect both his
current and alternative practices (see Exhibit D-3). The purpose of this first step is to highlight the specific
regulatory requirements that he has to comply with currently and under the PP alternative. For example,
J.F. circles status Number 1 under the current practice but not under the PP,alternative to indicate that,his
firm is currently a large quantity generator but would no longer be one under the PP alternative. In this
exercise,  Mr. Auric finds that he is subject to regulatory requirements in several programs (i.e., RCRA,
SARA Title III, CWA, and  QSHA), which  include numerous types of requirements (i.e.,  notification,
reporting, recordkeeping, planning, training, inspections, manifesting,  labeling, and protective equipment).

      His next step  is  to estimate the incremental annual costs  of  complying  with each applicable
requirement, using the Tier 1  cost tables.  As shown in Exhibit D-4, J.F. circles on the cost tables the status
numbers established in Step 1. For each  requirement, he then estimates the cash flows using the formulae
and  default values  provided  in the cost  tables. In  several .cases Mr. Auric,could directly estimate  the
incremental Annual Cost for the requirement from his  personal  experience; instead of using the cost
equations and defaults provided.  He sums the estimates on each cost table and reports this cost estimate
into the  "Cash Flow11 column of Worksheet L  As shown in Worksheet I, his incremental bidden O&M
expenses equal $2,490 per year.

      The next step  is to analyze the financial implications  of the $2,490 (+2.49) in estimated lower
regulatory compliance costs.

-------
                                             D-10
                                         EXHIBIT D-3

                           REGULATORY STATUS QUESTIONNAIRE
                             (for current and alternative practices) a/
         Status Number
Current Practice    PP Alternative
                                  . Does/Is Your Facility:
Resource Conservation and Recovery Act
 .-—fl)              1            A RCRA large quantity generator?
**      2              2            A RCRA small quantify generator?
       3  _^ A        3            A primary exporter of hazardous waste?
          """   "      4            Have hazardous waste storage, tank(s) on site?
                      5            Transport hazardous waste?
       6  W"\JP      6            A final status TSD facility?
       7              7            An interim status TSD facility?

Comprehensive Environmental Response, Compensation, and Liability Act b/
       g              s            Have CERCLA Section 4661 chemicals (see Exhibit B-2rl)
 Superfund Amendments and Reauthorization Act, Title
       10
10
Clean Air Act
13
14
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Si.
s/
s/
 Clean Water Act
        15
 15
Handle any 40 CFR ง355 Appendix A and B extremely hazardous
substances at of above their Title III threshold?

Occasionally release reportable quantities (see 40 CFR ง302 and
Table 302.4) of CERCLA hazardous substances or any 40 CFR ง355
Appendix A and B extremely hazardous substances?

Maintain  any  material  safety  data  sheets  under  29  CFR
ง1910.1200(g)(8) (see (22) under OSHA)?

Have 10 or more employees and fall within SIC codes 2000 to 3999
and within the current calendar year handle 40 CFR ง372.65 toxic
chemicals above thresholds stated in 40 CFR ง372.25?

A new stationary source (see Exhibit B-4-2 of Appendix B)?

Emit Section 112 hazardous air  pollutants (see Exhibit B-4-3 of
Appendix B)?

Within an industry listed in Exhibit B-4-4 of Appendix B?

Have a PSD permit?

Have a nonattainment permit?


Discharge wastewaters directly to surface water?

Discharge wastewaters  to a publicly  owned  treatment  works
 (POTW)?

-------
                                            .D-ll
                                   EXHIBIT D-3 (continued)

                           REGULATORY STATUS QUESTIONNAIRE
                             (for current and alternative .practices) a/
         Status Number
Current Practice    PP Alternative                        .  Does/Is Your Facility:

Clean Water Act (continued)      ;
       17             17           Occasionally discharge reportable quantities of hazardous substances
                                   as defined in 40 CFR ง117?

                      '({jp          Have toxic pollutant discharges listed in Exhibit B-5-2 of Appendix
                                   B for which chemical-specific standards have been promulgated?
                      __
                                   Within an industry listed in Exhibit B-5-3 of Appendix B?
     (grfuK^—tg>

Occupational Safety and Health Act
       19              19           Have less than 10 employees or is it within SICs 52-89 (except 52-
                                   54,70,75,76,79,80)?                  \

       20              20           Have 10 or more employees and is it not within SICs 52-89 (except
                                   52-54,70,75,76,79,80)?

                                   Have OSHA air contaminants as per 29 CFR ง1910.1000, Table Z-
                                   Handle  any   hazardous  chemicals  as  defined,  in  29  CFR
                                   ง1910.1200(c)?

       23             23           A hazardous waste treatment, storage, and disposal facility (regulated
                                   under 40 CFR Parts 264 or 265), or a large quantity generator of
                                   hazardous waste, or a facility accumulating hazardous wastes for 90
                                   or more days  (as defined in 40 CFR ง26234)?
        .  •  '         •'        :      •.'.''..'-         '•<.'.••'.•".•    -..'•
       c/              c/           Handle any OSHA chemicals listed in Exhibit B-6-2?
a/    For funher information about the regulatory programs, see Appendix B or the appropriate sections
      of the Code of Federal Regulations. Other Federal Programs (e.g., Toxic Substances Control Act,
      Safe Drinking Water Act) and state programs (e.g., New Jersey ECRA) may apply but were not
      analyzed in this manual due to resource'limitations.  Note that SARA Section 312 (reporting on
      emergency preparedness) is covered by Status Number 11 and SARA Section  313, (reporting on
      environmental releases) is covered under Status Number 12.

b/    Most of these costs are covered in Tier 2, Liability Costs - Chapter 4.

c/    These questions apply to additional chemical or industry-specific  requirements that can impose
      significant costs, and should be considered.  Due to their specific nature, however, these costs are
      not quantified in this manual       .                                                  -   ,

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-------
                                               D-26
      D.3.2  Tier 1 Financial Calculations

      After completing his Tier 1 cost calculations (i.e., middle block of Worksheet I), Mr. Auric proceeds
to Chapter 6, where he again uses the financial calculations to  discern whether or not his PP alternative
is economically justified at the Tier 1 level.

      Mr. Auric maintains the escalation rate at four percent, the first year of cash flow at the current year
(year 0), and the project lifetime at 20 years. As in Tier 0, after entering cash flows into the worksheet,
Mr. Auric calculates the annualized costs for each Of the non-zero expense items, then sums the costs onto
line B (note that no currently foreseeable regulation would require incremental capital expenditures in Tier

1>'
      He reports onto Worksheet V the incremental annualized costs from Worksheet I  (J.F.  does  not
need Worksheet IV in Tier 1 because he  performs the analysis incrementally).  Using  the procedures
described in Step 3 of Chapter 6, Mr. Auric calculates the  tax liability and the net annualized savings of
the PP alternative relative to the  current practice, taking into account hidden  regulatory costs only (Tier
1).  With annualized cash flow increasing by S3,600, the Tier 1 tax liability is -$1,600 per year so that the
net'annualized savings for Tier 1 are $2,000  per year (i.e., hidden regulatory costs are about $2,000 less per
year with the PP alternative than with the current practice after  considering $1,600 increase in taxes).  Net
savings through  Tier 1 are -$1,500 at a 15 percent discount rate.  The NPV through Tier 1 is -$9,400 (i.e.,
total annualized savings of -1,500 divided by an annualization factor of 0.1598).  Mr. Auric then determines
the internal rate of return (IRR) which equals 13.7 percent.  Mr. Auric concludes that the alternative is  still
not economically justified through Tier 1.  Therefore, Mr. Auric proceeds to higher-level tiers of the cost
protocol; Le.,  liability costs in Tier 2 and less tangible costs in Tier 3.


D.4   TIER 2:  LIABILITY COSTS

      D.4.1  Tier 2 Cost Calculations

      This hypothetical example does not include in Tier 2 the penalties and fines discussed in Chapter
3.  Due to resource limitations in developing this example,  only future liability costs are assessed. Please
note that if your firm is found  to be in violation  of any environmental laws, the fines and penalties can be
severe.

      Mr. Auric first identifies the waste  management activities that may  impose  some liability on his
firm.  Chapter 4 identifies the following three hazardous  waste management activities:

      •      Treatment or storage in tank(s);

      •      Transportation; and
                                                              '  •                -    -          i •   '
      •      Disposal in a landfill (on-site  or off-site).

Mr. Auric determines that as a result  of his current activity, he has undertaken and still undertakes each
of the three activities and is, therefore, subject to potential liabilities  for each. His alternative practice,
however, would  not require any of these activities in the future.

      Having determined the waste management activities he currently engages in, Mr. Auric uses Appendix
C to estimate the costs of future liabilities.  Since AJI is subject to aU types of liabilities under the current
practice, all of the equations in Appendix C are applicable.  Using these equations, Mr. Auric completes
Exhibit D-5).  That is, he estimates the total liability costs attached to each waste management practice, his

-------
                                              D-27



                                          EXHIBIT D-5

                          TIER 2 COST TABLES (FUTURE LIABILITIES)
    Type of Liability


Soil and Waste Removal
and Treatment

Ground-Water Removal
and Treatment

Surface Sealing

Personal Injury

Economic Loss

Real Property Damage

Natural Resource Damage



Total Liability (TL)


Your Share of Total
Liability (fL)


Cash Flow Estimate
(=TLxfL)
                               Exhibit*               Tanks                              Land
                             in Appendix C a/    Treatment/Storage     Transportation    Disposal
C-l


C-2


C-3

C-4

C-5

C-6.

C-7



NA


NA



NA
                                                     o

                                                    o
                                                  O
                                                 $13-
                                                                                       0.  o;
                                                 2/2.
First Year of Cash Flow b/
                                  C-8
NA = Not Applicable

a/    Refer to Appendix C, Exhibits C-l  through C-8, for preliminary illustrative guidance on how to
      estimate each type of liability and the first year of cash flow.  Note, however, that Appendix C is
      meant only to be illustrative of the concept  and mechanics of future liabilities associated with
      hazardous materials and waste management. Appendix C cannot and should not be used for definite
      answers to the very complex problem of liabilities.          ,

b/    The timing of future liabilities is very important because, other things being equal, liabilities incurred
      in a distant future have a smaller net present value, and therefore a lesser impact on' the economic
      feasibility  of a PP alternative, than liabilities incurred in the near future.

-------
                                                D-28
decision.

       D.4.2  Tier 2 Financial Calculations




annualized costs of projected liabilities is still $84,000 per year.
 far exceeds his 15 percent minimum acceptable rate of return.

        D.43  By-Difference Technique

        Mr Auric performs the by-difference calculations because he does not have great











  costs are taken into account

         At this Doint in the analysis, Mr. Auric could stop the economic analysis of the PP alternative.
                            ซ fre'addressed next as an illustration of the Tier 3 cost analyse

liabilities (as uiustraiea in ^ppeuuiA v^/, "ป~  ..~i-~	
estimated "by difference.'  Section(s) D.4.1 and D.4.2 present
predictive modeling framework for estimating liability costs.
technique.

-------
                                               D-29
D.5  TIER 3:  LESS TANGIBLE COSTS                                    •

•       Mr. Auric recognizes that less tangible potential costs such as adverse community and labor relations,
and unfavorable loan rates to facilities managing hazardous waste, if favorably controlled, will result in an
increase in revenues  for Auric Jewelry Inc.  He proceeds to the Tier 3 level to estimate the potential
revenue increase.         ,                           _  "               .

    ,   D.5.1 Tier 3 Cost Calculations

       To estimate the economic impact of less tangible costs on his gold  plating operation,  Mr.  Auric
completes  Worksheet III incrementally. Mr. Auric first describes qualitatively the less tangible benefits of
his PP project  He recognizes that the project will improve his firm's public image and thus  increase net
revenues from sales  of gold-plated jewelry.   According to a marketing survey  conducted by ids trade
association, Mr. Auric  estimates that an improved corporate image resulting  from innovative  hazardous
waste management will increase his  gross sales by 03 percent. Based upon his 1989 annual revenues of $10
million, he thus estimates that  the  PP alternative will increase his annual operating revenues by $30,000.
He also knows that his pre-tax  net revenues are roughly equal  to  10 percent of  his gross revenues.
Therefore, he estimates that the PP alternative will increase his net revenues  by  $3,000 a year. He thus
writes +3  under 'cash flow estimate" in the "adjustment to operating revenues" line of Worksheet IIL

       D.5.2 Tier 3 Financial Calculations

       After completing his analysis of Tier 3 costs, Mr. Auric proceeds a final time to Chapter^.  Using
the financial calculations, he finds that less tangible benefits can be as high as $2,400 a year at his minimum
acceptable rate of return and would bring  the  IRR of the PP project up to 34 percent The PP project
looks even better than  before.                                                              ,   ,


D.6   SUMMARY OF  MR. AURICS CALCULATIONS

       Exhibit D-6 summarizes the cost savings or benefits to the hypothetical firm  at each of the four
'tiers' or levels of analysis. For the hypothetical firm, the cost savings from raw materials are not large
enough to compensate  for increased costs such as the capital expenditure for purchase and installation of
the mechanized aqueous-based cleaner.  At the Tier 0 level, the PP  project costs an additional $3,500 a
year  compared to the current practice and has an Internal Rate of Return (IRR) of 12 percent, which is
less than the 15 percent rate of return required by Mr. Auric for investing in new projects.  Therefore, the
PP project is not justified using usual costs only.

       The PP project continues to be not cost-justified when considering hidden  regulatory costs (Tier .1)
in addition to usual  costs.   Despite the  additional cost  savings  associated  with reduced  regulatory
requirements (e.g., less inspections), the PP project continues to cost $1,500 more  than the current practice
each year with an IRR of 13.7 percent (still  less than the 15 percent minimum acceptable rate of return).

        The PP project becomes cost-justified when liability costs (Tier 2)  are added to usual costs and
hidden regulatory costs. Compared to the current practice, the PP project is  estimated to save $45,600 a
year  in the form of reduced future  liabilities  associated with the management (especially solvent storage in
 tanks and ash disposal in landfill) of hazardous waste and materials. The PP project has an estimated IRR
of 33 percent, which far exceeds  the  15 percent minimum rate of return acceptable to Mr. Auric.

       The PP project  looks even better when less  tangible benefits (Tier  3), such as increased sales
 resulting from improved corporate image, are also taken into account At the Tier 3  level, the PP project
 is estimated  to save $48,000 a vear compared to the current practice.  Because the IRR  estimate (34
 percent) is greater than 15 percent, the PP project is cost-justified.

-------
                                            D-30
                                        EXHIBIT D-6

                   BENEFITS TO THE HYPOTHETICAL FIRM OF SWITCHING
                      FROM CURRENT PRACTICE TO PP ALTERNATIVE
 Level of Analysis/
Benefits
Project Justification
           Cost Item
     Net Savings or

(in $ per year) a/
Tier 0: Usual Capital Costs and O&M Costs
PP alternative not cost-
justified. Fails to meet
the firm's 15% minimum
rate of return on investment
Tier 1: Hidden Regulatory Costs

PP alternative not cost-
justified.  Fails to meet
the firm's 15% minimum
rate of return on investment.
Tier 2: Liabilities

PP alternative is cost-
justified. Has an IRR of 33%,
which is greater than 15%
minimum rate of return on
investment
Tier 3:  Less Tangible Benefits

PP alternative is cost-
justified.  Meets the firm's
hurdle for investments
(34% > 15%)
Equipment and installation
Raw Materials
Energy
Disposal
Maintenance
Revenues

Tier 0 Taxes
After-Tax Savings Through Tier 0
IRR Through Tier 0
Reporting
Inspections
Other

Tier 1 Taxes
After-Tax Savings Through Tier 1
IRR Through Tier 1
Treatment or Storage in Tank
Transportation
Disposal in Landfill

Tier 2 Taxes
After-Tax Savings Through Tier 2
IRR Through Tier 2
 Net Increase in Operating Revenues

 Tier 3 Taxes
 After-Tax Savings Through Tier 3
 IRR Through Tier 3
     -$24,800
      $57,900
     -$14,500
      -$2,900
     -$11,600
      -$3,200

      .$4,500
      -$3,500
          12%
         $930
       $1,800
         $870

      -$1,600
      -$1,500
         13.7%
       $47,500
       $1300
       $35300

      -$37,000
       $45,600
           33%
       $4300

       -$1,900
       $48,000
           34%
 a/     All savings are before tax except when in bold.  A discount rate of 15 percent is assumed.  Negative
       estimates represent a cost increase or net loss. Positive estimates represent a cost decrease or net
       benefit  All numbers may not add up due to rounding.

-------
    Worksheet 0
Tier 0 • Usual Costs
Buurrent Practice

D Alternative Practice

O Incremental
ITEM DESCRIPTION *
" *' ',
A. DEPRECIABLE CAPITAL
EXPENDITURES
. ';;.-:.-A3 . ..Equipment •• '-V '
.'' -:... ' .- ..•••: , '.. :. '" ..'• '. ••'. •-••'•:
A2 Materials
:?:>A'3 viSUliBty Connections ' •: '.'.^..
A4 Site Preparation
•• vA5 Installation •-'. } '•.' • > ,;K:;L.
A6 Engineering & Procurement
B. EXPENSES
Bl Start-up

:B2 Pennitling •.;. '':';^'f$jj*--
B3 Salvage Value
B4 •• 'Training . • ; - '' ' " • , :''?.:;if;:;
B5 Initial Catalysts
B6 Working Capital i;
B7 Disposal
B8 Raw Materials
B9 Utilities
BIO Catalysts & Chemicals
Bll Labor

B12 Supplies
B13 Insurance .
B14 Other t ^fl.CU'nf
^?:::f:v>;.::.;%:::,

0

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ANNUA1JZED CASH FLOW^I

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-------
    Worksheet 0
Tier 0 • Usual Costs
O Current Practice

Q^AIternative Practice

Q Incremental
ITEM OESOtfPTlON _ ; .

A. DEPRECIABLE CAPITAL
EXPENDITURES
Al Y.-Equiproenl ' '••"<"..•' "'",.
A2 Materials
A3 Utility Connections' ; ..,.;.-
A4 Site Preparation
AS installation : , :'-;-' ';';:; ••"•..,::&-.
A6 Engineering &. Procurement
B.. EXPENSES
Bl Start-up
B2 Permitting < '- '- •'-• -'['^ \.
B3 Salvage Value
B4 Training - . •;.. :.: j: *'lj;. f
..:,.. . :.:'.*•:.".."•>•••• v-'-i'i :i
B5 Initial Catalysts
B6 Working Capital , f '•
B7 Disposal
B8 Raw Materials
B9 Utilities
BIO Catalysts &. Chemicals
Bll Labor
BX2 Supplies
B13 Insurance
B14 Other i ^WQj/nJ&Jrtja/njyc.-
C. OPERATING REVENUES
Cl Revenues
C2 By-product Revenues

















^ , ,15ASH -FLOW ' INFORMAliON^ J
Escalation
Rat*
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ANNUAUZED CASH FLOWJ^
V^
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-------
               Worksheet IV
                Cost Summary
         (In thousands ofyear-0 dollars)
Tier
    ITEM DESCRIPTION
 Alternative
a. DEPRECIABLE CAPITAL
  EXPENDITURES
b. EXPENSES
c. OPERATING REVENUES
d. PENALTIES AND FINES,
e, FUTURE LIABILITIES
 Current
a. DEPRECIABLE CAPITAL
  EXPENDITURES
b. EXPENSES
c. OPERATING REVENUES
e. FUTURE LIABILITIES
ANNUALJZED CASH FLOW

r * 5%
Q
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-------
                 Worksheet V
              Financial Worksheet
          (In thousands of year-0 dollars)
       Tier
    ITEM DESCRIPTION
Alternative Less Current
a. DEPRECIABLE CAPITAL
  EXPENDITURES
b. EXPENSES
c; OPERATING REVENUES
d. PENALTIES AND FINES
e. FUTURE LIABILITIES
ANNUAUZED CASH FLOW"11

rd.6%
-12.4
23.4
-3.Z
—
	 ::
rf 10%
-18.2.
2.3
-3.Z
—
'.. —
rd= 15%
-24.ฃ
2.2.3
-3.2.
	
- —
- 6-/Z
-2o.?
2.3
-3.2.
	
— —
f.  TAX LIABILITIES
-ฃ-3
-&
-4.5
-$.!•
g. NETISAVINGS FOR TIER
 Total Savings
0
         IRR
THROUGH TIER 0
THROUGH TIER 1
THROUGH TIER 2
THROUGH TIER 3

6.8



Z.I



-3.5



0




12-%



   Cashflow estimates for alternative less current, by definition, is the same
   as cash flow estimates for incremental analysis.

-------
    Worksheet!
Tier 1  • Hidden Costs
ITEM [DESCRIPTION ''',*>

A. DEPRECIABLE CAPITAL
EXPENDITURES
. ; :iAl Monitoring Equipment
A2 . Preparedness and Protective
Equipment '
•A3 Additional .Technology -.;^i :.';ฃ&,..
= •.".".. ' •• . !: .-:-':'-:-:;'-'::::::'- "'
A4 Other
B. EXPENSES
Bl Notification
-:B2 Reporting
B3 Monitoring/Testing
^ B4 iRecordkeeping
B5 Planning/Studies/Modeling
B6 ; ^Training
B7 Inspections
•' BS Manifesting . ';:;':-:>:V;ซVฅJ^-
B9 Labeling
.'BIO ".Preparedness .and
Protective Equipment
Bll Closure/Post Closure Care
B12 Medical Surveillance
B13 Insurance/Special Taxes '
B14 Other











CASH FLOW INFORMATION ^ „,
* ' ' '
Escalation
Rat*



,-•/•'• • ' : . ••
4
w:
.Je
^
-.


/
/
/
/
First Yซar
of Cash Flow
(tr yปars)

'<:, " • ' ' '••;
••••• '•'' .•.•1;.;i:;
0
' ". . .... '-• -:;:••.:•.
^:'^SK?,

\
x
/\

-


Lifetime .
(n, years)
•
'•'•'.."- .
' " ' ••'•!''•
2.0
tfi
ms
1
•






Cash Flow
Estlmat*
(C.aj)

• ;..':
••• .••,-,,;;::,,.
2.45
0. 003
'Zo-J&b
iip-

0.33
0,o3
o.io



f
•^ In thousands of year-0 dollars '.,,'.
D Current Fvacxvce

CI Alternative Practic

E^lncremental
                              ANNUAUZED CASH
                             rd.S%
                             3.?
     3.6

-------
                Worksheet V
            . Financial Worksheet
          (In thousands ofyear-0 dollars)
                            Tier
'* ITEMfDESCRIPT1pN "' "
Alternative Less Current
, a. ^DEPRECIABLE CAPITAL
EXPENDITURES
b. EXPENSES
c: OPERATING ^REVENUES
d. PENALTIES AND FINES
e. 1FUTURE LIABILITIES


"ANNUA1JZED CASH FLOW-11
r • ป BVป
o
'—
3.?
__•;
	
	 '::
rdซ 10%
.• 	 —
3.^
••——..
— —
•" '; — .
rf 16%
: — '
3.6
. — — '
—
	 •-.:>ป.
rl&
•••—•*
3.6"
•• — _
—
• — ; ,
f. TAX LIABILITIES
-u
g; NET SAVINGS TOR TIER
Total Savings
                              IRR
THROUGH TIER 0
THROUGH :TIER i
THROUGH TIER 2
THROUGH TIER 3 / "

^.f
?,3


2. 1
4


--34T
-/.S"


-2.
a



/2JT
ซ?4


 il Cashflow estimates for alternative less current, by definition, is the same
   as cash flow estimates for incremental analysis.

-------
      Worksheet II
Tier 2 • Liability Costs
D Current Practice
D Alternative Practio

B^Tnbremental
ITEM DESCRIPTION \

A. VENALITIES AND FINES
B. FUTURE LIABILITIES
B I. .Treatment .or. Storage, in 'Tanks
B2 Transportation .
B3 Disposal in Landfills , ../. .,
B4 Other


, CASH FLOW INFORMATION ]
Escalation
Rate

' —
""4V;-
4:
First Year
of Cash Flow
(t . years)


**.
Lifetime
(n, years)


**ฃ
Casn Flow
Estimate
(C.aj)

	 • 	 ~
— — 	 	

al ' ' - ' • ' ' •'-.,'• . -•
— ' In thousands of year-0 dollars • -' ' '^

:
ANNUAUZED CASH FLOW-"1
r * 5%
d

-/w.f.
5S.2

re 10%'
a

34, S
1.4

d

P4. 1
''•3

r K


-., •:;'•


-------
                 Worksheet V
              Financial Worksheet
          (In thousands ofyear-0 dollars)
  ' ' ITEM DESCRIPTION
Alternative Less Current
;a. ^DEPRECIABLE CAPITAL
EXPENDITURES
b.
C.:'
d.
•e..
EXPENSES
OPERATING
PENALTIES

REVENUES
AND FINES
FUTURE LIABILITIES
                              ANNUAUZED CASH FLOW-
Vs*
•ri-~-
• 	
_-_.
	 •.
1QO.B
rdซ10%
•.'•- 	
	
: 	 _'"
	
34.5-
rd= 15%
-•.:__ 	
	
•- 	 •
' 	
^4.!
&=33
;..': 	 ;
	
'_ — •
	
to
Tier
 f. TAX LIABILITIES
-44-4
-4I.6
-3?
-I3.4
 g. .NET SAVINGS FOR TIER
 Total Savings
   THROUGH TIER 0
   THROUGH TIER 1
   THROUGH TIER 2
   THROUGH TIER 3
€.%
S..3:
ฃ>$.?>

Z.I
4'
$7

-3.5"
-/.C
4S1.6

—
-24.?
0
""'••••;.' '•'
  i! Cashflow estimates for alternative less current, by definition, is the same
    as cash flow estimates for incremental analysis.
                                                            IRR

-------
- ITEM DESCRIPTION' ,

A.
B.
ADJUSTMENT TO
EXPENSES

ADJUSTMENT TO
OPERATING REVENUES
                           Worksheet HI
                    Tier 3 •Less Tangible Costs
O Current Practice

D Alternative Practic

   Incremental
CASH FLOW INFORMATION

Escalation
Rat*


';4:: 	 '
First Yซar
of Cash Flow
(tr years)

0 :
Lifetime
(n, yoarc) •
.'
dZO...:.
Cafh Flow
Estimate
(C.aj)

v3 "';
ANNUAUZED CASH FLOW-2

r ซ5%
d

4.4
rdซ 10%

4-4'^
^.,16%

4-3.
•y


1 In thousands of year-0 dollars

' ' % "

Consumer Acceptance
r-, W
n s
YES /NO'

.,-,...

Employee/Union Relations:
n Isf
YES 'NO



Corporate Image , :
'YES* NO ::

' , ' • ' ;'i:-


TIER 3 COST FACTORS /
Justification (Please justify)
'," •'•'•' '


-.---': - '• . ' • ' ' ' - . .
Justification (Please justify) ,• -


- ' - - " ''"-•".- • ' ,

Justification (Please justify) ' ' (
TA^ '72^6^ ^JUM&ff*-~ i^^ff' UK& •
MKtArtX^ <*JK^ ^^#17 /fJ^L OVtL
. ' ...-'/"••' /f/
- • *• ' !/ ' .. • "
•:; :/ ••'••. , :..:..- •:•'•-:•• . •• .'" • • •:.; . -•;••••• -v.-:; •• '••:"' ;.'. /:;• /" ...'•:. 'y.';^-'- '"•''•'-•.'- ^:^:: : •'



















-------
                Worksheet V
             Financial Worksheet
         (In thousands ofyear-0 dollars)
Tier
^-|TEM^SCR.PT.ON^ ^
Alternative Less Current
a. DEPRECIABLE CAPITAL
EXPENDITURES
b. EXPENSES
•COOPERATING REVENUES
d. PENALTIES AND FINES
el FUTURE LIABILITIES


ANNUAUZED CASH FLOW^1
T = 5% '
d


4r&.


V*

,
4,41

:;v::: •;>,
Vซv.
': "" ."'•..}

•^3-


:&=34


^.5-


f. TAX LIABILITIES
-/.3
-/.f
-/.3
-Z
g;:;NET.:;SAVINGS .FOR TIER;
                                                            IRR
j[ utut, ut*vt/t5ป>
THROUGH TIER 0
THROUGH TIER 1
THROUGH TIER 2
THROUGH TIER 3 V

6.8
2.2
6S. 3
&.9
Z.I
*--:.-
s*
S9S
-s,r
ฑi&
4S.6
' -4* •"•••
— :
— .
-z.y
"*>-

tZ#
&*%
33%
34-%
  •J Cashflow estimates for alternative less current, by definition, is the same
    as cash flow estimates for incremental analysis.

-------
                                          APPENDIX E

                             TREATMENT STANDARDS UNDER THE
                                LAND DISPOSAL RESTRICTIONS


       In the 1984 Hazardous and Solid Waste Amendments (HSWA) to the Resource Conservation and
 Recovery Act (RCRA), Congress mandated restrictions on .the land disposal of hazardous wastes.  Under
 the land disposal restrictions (LDRs), most hazardous wastes can no longer be land disposed without prior
 treatment  Treatment standards may be one of two types:  concentration-based standards or technology-
 based standards.  To comply with the land disposal restrictions, you must:

       (1)   Treat your waste to reduce the concentration of each hazardous constituent to
             below its respective concentration standard  if a concentration-based treatment
             standard has been issued for your waste type;  or

       (2)   Treat your waste by the specified technology if a technology-based treatment
             standard has been issued for your waste type.

       Hazardous wastes have been divided into three main classes for the purpose of scheduling and issuing
 the LDR rulemaking:

       •     Solvents and diodns;
       •     California list wastes; and                                     ,
       •     The scheduled wastes.                                 • . '•

 The scheduled wastes are subdivided into thirds based on the quantity generated nationally and the waste's
 toxicity.  For example, the first-third of the scheduled wastes is comprised .of the highest quantity, highest
 toxicity waste types.  EPA has promulgated final rules restricting the land disposal of solvents, dioxins,
 California list wastes, and First and Second Third wastes.  EPA will propose and finalize the Third Third
 land disposal restrictions no later than May 8,1990.  In the future, the land disposal restrictions program
 may be applied to a much broader range of wastes under the Toxicity Characteristic (TC) rule now being
 developed.                                                           "

      For information on  treatment standards and effective dates for all hazardous wastes, please contact
 EPA's Office of Solid Waste or the RCRA Hotline (1-800-424-9346 or 1-202-382-3000). Note that guidance
 on  the LDRs and an outline of the  process to determine if the LDRs are applicable to a waste are also
 available from two sources:

      •      Superfund LDR Fact Sheets. OSWER Directives 93473-01FS - 06FS (July, 1989);  and

      •      Superfund LDR Appendices. Appendices A-l through A-6 of the Draft Superfund Guidance
             on Complying With the RCRA Land Disposal Restrictions (LDRsl OSWER Directive 9347.2-
             01 (draft version, not yet published).

Following is a summary of each of these two documents with information on obtaining a copy for each.

      Superfund LDR Fact Sheets

      The following fact sheets are available in this series:                              '

 .     1-    Overview of the RCRA Land Disposal Restrictions                  N ".
      2 -    Overview of California  List Wastes
      3-    Overview of LDR Treatment Standards and  Minimum Technology Requirements
      4-     Overview of Soft and Hard Hammer Restrictions
      5 -    When are the LDRs Applicable Requirements?
      6-    Obtaining an LDR Treatability Variance During Superfund Remedial Actions

-------
                                              E-2
      Copies of these fact sheets are available from the EPA Headquarters Public Information Center, 202-
475-7751.

      Superfund LDR Appendices to the Draft Superfund Guidance on Complying With the LDRs

      The Office  of Emergency and  Remedial Response (OERR)  has  prepared six appendices that  ^
summarize the LDRs in effect as of June 8,1989.  These appendices summarize the LDRs in effect for
each RCRA hazardous waste, and if a treatment standard is in effect, what the treatment levels or method
of treatment are for each constituent The appendices also provide a list of the constituents found in each
restricted  waste (organized by constituent), and effective dates for soil and debris wastes subject to  the
LDRs.

      Copies of the appendices will be available  when the Guidance document is published, and  the
appendices will be updated when the Third Third LDR rule is published in May, 1990.
                                                                                                    J-

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&EPA
             United,States      Office of Policy, Planning
             Environmental Protection  and Evaluation
             Agency
Pollution Prevention
Benefits Manual
             Volume I:  The Manual
             Volume II: Appendices

                          Phase II
                          EPA/230/R-89/100
                          October 1989
                                      Printed on Recycled Paper

-------

-------
Pollution Prevention Benefits Manual

               Volume!: The Manual

                              Phase II
                             Prepared for: Office of Policy, Planning and
                                       Eyaiuation and
                                       Office of Solid Waste

                                       U.S. Environmental Protection
                                       Agency
                                       October 1989
                                           EPA

-------

-------
      .                      TABLE OF CONTENTS


                              VOLUME I, THE MANUAL
   f                       •       •       •        ,                     _••=,"#

                       • r  '  ;  '      ' •   -.'••••     ..•-:.•   -. .     •  .    Page

ACKNOWLEDGEMENTS : . . .". . . • • •. ---- '•_••• .>........ ..... ...... .... ... .....   fe
PREFACE  -i
CHAPTER 1:  iNTRODUCTION  ........

     .   1.1  What Is Pollution Prevention?
            1.1.1   What Does EPA Mean By Waste Minimization?  ---- ... ...... • •• •  w
            "l.li   What Does EPA Mean By Pollution Prevention?  ........>.... ----   1-1

        1.2  Why Should You Undertake Pollution Prevention?  ...... ......... .....   1-2

        13  What Approach .Is Used In This Manual?  ........ ..... .............   1-3

            13.1   Four-Tier Cost Protocol   ... ...... . ..... -.-... ----- ..........   1-3
            13.2   Common financial Protocol  ...... ........... — ...........   1-5-

        1.4  What Will You Get Out Of This Manual? . . . ...................... ^   1-5

        1.5  How Is This Manual Organized? '. . . ... . . . .;...-. ... .... .,. • • • • • •'•-• ••-.... *•*


 CHAPTER 2:  TIER 0 COST PROTOCOL: USUAL COSTS  . ... .... . . ... . . . . *•;: .... . . .   2-1

        Introduction  .............. -^ •••'••••••••••'• 'V; ••••••••••••••" •

        Step 1: Identify PP Alternatives ...  .ป.-..'., ---- . ..... .................   2-2

        Step 2: Estimate The' Usual Costs Of Current And Alternative Practices  ........   2-3

        Step 3: Complete  The Tier 0 Cost Worksheet .................•••..••••   2-7


 CHAPTER 3:. TIER i COST PROTOCOL: HIDDEN REGULATORY COSTS . . ... . . . . . . .   3-1

       7  Step 1: Establish Your Fadlity's Regulatory Status . . . . . . . . ..... ..'. ..... . . .  .3-2

         Step 2: Estimate Hidden Capital Expenditures  .................. ..... "... ซ   3-2

         Step 3: Estimate Hidden Expenses  . ... . . ... . . . . ...... .-.• • > •  • ซ • • • • ••-.ซ• • •   3*5

         Step 4: Complete Middle Block of Worksheet.!  ............ ---- ...........   3-6

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                                            ii
                        TABLE OF CONTENTS (continued)



                           VOLUME I, THE MANUAL (continued)
 CHAPTER 4: TIER 2 COST PROTOCOL:  LIABILITY COSTS . .' ......... ...... ____ . .    4,1



         Introduction  . ............ . ............ .........'. ....... .......    4-2



         Step 1: Identify Regulatory Programs Under Which Penalties and/or Fines

                Could Be Incurred  ......... ............ . . . ................    4.2



         Step 2: Estimate the Expected Annual Penalties and Fines Associated with

                Each Program/Requirement  ..... ................... ..........    4-2
   •                     ,                               '      ,


         Step 3: Identify Waste Management Components to Which Liabilities Can Attach   . •    4-4



         Step 4: Estimate Total Expected Liabilities  .... ..... . ..................    4^ '



         Step 5: Estimate Year When Liabilities are Expected to be Incurred ..;,.......    4-6



         Step 6: Estimate Your Share of Total Future Liabilities  ..... ..............;    4-6





CHAPTER 5:  TIER 3 COST PROTOCOL:. LESS TANGIBLE COSTS ......... ........  '  5-1



         Introduction   . . ..... ฐ ....... . . . , ........ . ....... ..... . . . ..... ....    5-2



         Step 1: Qualify Less Tangible Benefits Of Pollution Prevention  . ... . . . ..... ___    5-2



         Step 2: Quantify Less Tangible Benefits Of Pollution Prevention   ..... . .......    5-2





CHAPTER 6:  FINANCIAL PROTOCOL   ______ . ____ ..... ........ "...'.'...';.....';    6-1



         Step 1: Evaluate Arinualired Cash Flows For Each Cash Flow Item  ......'....;    6-2      v-



         Step 2: Evaluate Incremental Annualized Cash Flows ...... ..... . . . ........    6-7
    i                                         -  • .                             '


         Step 3: Evaluate Key Financial Indicators Of Your PP Alternative  ....... .....   6-7



         Step 4:  Evaluate Economic Feasibility Of Your PP Alternative  ..... ........    6-12

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                                        iii
                      TABLE OF CONTENTS (continued)

                              VOLUME IL APPENDICES
APPENDIX As  BUNK WORKSHEETS
APPENDIX B:  HIDDEN COSTS OF SELECTED REGULATIONS . . . ... . ..... ..... . . . ."  B-l

        B.I  Resource Conservation and Recovery Act (RCRA)  .... .-. . . ... .... .*• ...   B-l

             B.1.1  Notification  ....;... ...v.v... ---- ....................   B-l
             B.1.2  Reporting  .^... .....••.;•••• — ซ••ซ.••••ซ.ซ•-••••*•••
             3.13  Monitoring/Testing  ........ ---- ,.... ----- , ..... .........
             B.1.4  Recordkeeping  .... . ------ .:............ ------ ...... ----
             B.1.5  Pianning/Studies/Modeling  . . ........ — "... ... . . • . ...... .*•••-
             B.1.6 Training  - ........ • ---- •••• ---- ....... ...... '....,..,... i'.   B-3
             B.1.7  Inspections  ' ....... ..... ...........'.............. ----   B-3
            • B.1.8  Manifesting  . ... .'.. ........... ..... ...... ---- ...........   B-3
             B.1.9  Labeling   .'.../ ..... ................. *..-. .... ----- ......   f-4
             B.1.10 Preparedness/Protective Equipment  . . ......... .................   B-4
             B.l.ll Ciosure/Post-Closure Assurance  .......*..;..............••: B-4
             B.1.12 Insurance.and Special Taxes  . . .-. . . ... .......... . : . .... • ... .  B-4

      .  B.2  Comprehensive Environmental Response, Compensation, and Liability
             Act (CERCLA) -'.. , .. .. . . • ....... ..ป ... ..... • . •> ..ซ > • • :-• • • ••••
         B.3  Superfund Amendments and Reauthorization Act Title HI (SARA Title III)  . .   B-8
             B3.1  Notincation  .,
             B.3.2  Reporting ...
             B3.3  Recordkeeping .
             B3.4  Inspeaions  ..
         B.4  .Clean Air Act (CAA)
                          •      •      : i    , ... -„„ ,.,; „       " •     •';"'•     •   ..   ' • *> <<7 "
             B.4.1  Notification  .:../. ;>.^ /.-...; -.'ij-'.-.v-'. '....... ; ...... .-.vi;.,..v. ,  ป-iz
             • B;4.2  Reporting  '                ............ .'•• ..............   B-13
              B.43   Monitoring/Testing  . ----- ...............••••••.•.••-•.•ซ
              B.4.4   Recordkeeping  ........ ,..v. ....-.......-..•;_•...••.•• -v- .;-i •-•
                    Inspections   .............. ---- ........................   B-13
         B.5  Qean Water Aa(CWA)
              B.5.1   Notification  ... ...... '"..
              B.5.2   Reporting  ...,............
              B.5.3   Monitoring/Testing^. ---- .....
              B.5.4   Recordkeeping^ . ...... . , — ..
              B.5.5   Inspections  ...........:....
              B.5,6   Preparedness/Protective Equipment

-------
                         TABLE OF CONTENTS (continued)

                           VOLUME n, APPENDICES (continued)
                                                                   .
        .  B.6  Occupational Safety and Health Act (OSHA)  .... ____ . ... . . . . . . ......   B-27

              B.6.1  Notification  ........ ..... .......... ........ ...........   B-27
              B.6.2  Reporting  . ............ ........ ............ ......... . .   B-27
             ' B.63  Monitoring/Testing  ........ ........... ................ ...   B-28
              B.6.4 ' Recordkeeping  ......... ... .......... ............. ....   B-28
              B.6.5  Planning/Studies/Modeling  ................... . .. ....... . ..   B-28
              B.6.6  Training  .................... . ......................   B-29
              B.6.7.  Inspections   . ................. . ..................... .   B-29
            ,  B.6.8  Labeling  . ...................................... ....   B-29
              B.6.9  Preparedness/Protective Equipment  ..... . . ............. .....   B-29
              B.6.10 Medical Surveillance  . .' ................ '. . . . .............   B-29


 APPENDIX C-  FUTURE UABELTIY COSTS  ......... ..... , ____ .;......... .....   C-I


 APPENDIX D.:  HYPOTHETICAL FIRM EXAMPLE   . . . ..... ........ ............. ''-  D-I

         D.I  Presentation Of Hypothetical  Finn  ____ .......... ...... ...... ....   I>4
                                                         1 '  ,  -         ' '       .       ' *'
         D.2  Tier 0:  Usual Costs  ... ........  . ......... ____ ............. . .
              D.2.1  Tier 0 Cost Calculations  .......... ............. ..... .:,...   b-4
             . D.2.2  Tier 0 Financial Calculations  ... ...... ............. .......   D-7

         D3  Tier 1:  Hidden Regulatory Costs  ........ ..... ..... ____ .........   D-9

              D3.1  Tier 1 Cost Calculations  ..................... ..... ......   D-9
              D3.2-  Tier 1 Financial Calculations  ....... .............. ........   D-26

         D.4  Tier 2:  Liability Costs  ____ ........ '. ..... ........ ........ _____   D-26

           •   D.4.1  Tier 2 Cost Calculations  .................... ..... :......   D-26
       •  •    'D.4.2  Tier 2 Financial Calculations  ... ........ .... ............ . .   D-28
              D.43  By Difference Teclmique  ... ____ .. ____ ... i ...... ____ . ......   D-28

         D^  Tier 3:  Less Tangible Costs  ... ....... .' . . . .  .............. ......   D-29
                                             *              •     '
              D.5.1  Tier 3 Cost Calculations  ......... ..... ... .. ......... . ...   D-29
              D^.2  Tier 3 Financial Calculations  ....... . .....................   D-29

         D.6  Summary of Mr. Auric's Calculations   ................ ..... .......   D-29


APPENDIX E: TREATMENT STANDARDS UNDER THE LAND DISPOSAL RESTRICTIONS    E-l

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                          LIST OF EXHIBITS
                          VOLUME X THE MANUAL
                                                                   Page
EXHIBIT 1-4-   APPROACH AND ORGANIZATION OF MANUAL: FOUR-TIER        '
             COST PROTOCOLS AND FINANCIAL PROTOCOL  .........'....   1-4

EXHIBIT 1-2-   BENEFITS TO THE HYPOtHETICAL FIRM OF SWITCHING
             FROM CURRENT PRACTICE TO PP ALTERNATIVE ..............   1-7


EXHIBIT 3-1:   REGULATORY STATUS QUESTIONNAIRE	••••   *-*


EXHIBIT 4-1-   SUMMARY OF PENALTIES AND FINES UNDER EPA FEDERAL
             PROGRAMS (FISCAL YEAR1987)	....	....>..........   4-3

EXHIBIT 4-2:.   COST TABLE FOR FUTURE LIABILITIES  ...........-,....". .'..   4-5


EXHIBIT 6-1:   TYPE OF CASH FLOW FOR.EACH CASH  FLOW ITEM  ,'.. .. .	   6-4

EXHIBIT 6-2:   TABLE OF VALUES OF PRESENT VALUE FACTOR 2 (PVF2) .....   ซ

EXHIBIT 6-3:   TABLE OF VALUES OF ANNUAU2ATION FACTOR (AF)  ...... /   6*

EXHIBIT 6-4:   TABLE OF VALUES OF DEPRECIATION FACTOR (FD)  ........   641

                          VOLUME II, APPENDICES

EXHIBIT B-l-1:   REGULATORY COSTS UNDER THE RESOURCE CONSERVATION.
  ,            AND RECOVERY ACT (RCRA) /.......... .... ...V. .........  B-5 ;

EXHIBrr B-2-1:   TAX ON CERTAIN CHEMICALS UNDER CERCLA SECTION 4661  ..   B-7"

EXHIBIT B-3-1:   REGULATORY COSTS UNDER TITLE III               .
              THE SUPERFUND AMENDMENTS AND REAUTHORIZA.T1PN ACT    B-ll

EXHIBIT B^4-i:   REGULATORY COSTS UNDER THE CLEAN AIR ACT^CAA) .. v..   B-14

EXHIBIT B-4^2:   CLEAN AIR ACT INDUSTRY-SPECIFIC REGULATIONS ON
              STANDARDS OF PERFORMANCE FOR NEW STATIONARY
              SOURCES  ......I........:.....	••	   ^15
                  -.'-'."      .''*•'     .        .-'..'.- '-rv-1 y   -••..•

EXHIBIT B-4-3:   HAZARDOUS AIR POLLUTANTS WITH PARTICULAR EMISSIONS     7
              STANDARDS UNDER THE CLEAN AIR ACT  ..I..	   B-17

EXHIBIT B-4-4:   INDUSTRIES WITH PARTICULAR-NATIONAL EMISSIONS         v
              STANDARDS FOR HAZARDOUS Am POLLUTANTS UNDER THE
              CLEAN AIR ACT  .......>..v.......... J. r...-V	......   B-18

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                                    vi
                      LIST OF EXHIBITS (continued)

                       VOLUME n, APPENDICES (continued)
                                                                     Page
. EXHIBIT B-5-1:   REGULATORY COSTS UNDER THE CLEAN WATER ACT  . _______   B-22

 EXHIBIT B-5-2: ,  TOXIC POLLUTANTS UNDER THE CLEAN WATER ACT  . ....... . , B-23
                                          s          .'..-'    "      ' '
 EXHIBIT B-5-3:'  INDUSTRIES WITH PARTICULAR EFFLUENT GUIDELINES
               AND STANDARDS UNDER THE CLEAN WATER ACT  ..........   B-25

 EXHIBIT B-6-1:   REGULATORY COSTS UNDER i THE OCCUPATIONAL SAFETY
              •AND HEALTH ACT (OSHA) .....; ..... . ........... •••••••   B-31

 EXHIBIT B-6-2:   OSHA CHEMICALS AND ASSOCIATED REQUIREMENTS  . . ......   B-32


 EXHIBIT C-l:    SOIL AND WASTE REMOVAL AND TREATMENT  ......... ____   C-2

 EXHIBIT C-2:    GROUND.WATER REMOVAL AND .TREATMENT ..............   C-3

 EXHIBIT C-3:   . SURFACE SEALING  . .... ..... . ........ '. ..... ..... . .....   O4

 EXHIBIT 04:    PERSONAL INJURY  ...... ............. ............ •.•-••   C-5

 EXHIBIT C-5:    ECONOMIC LOSSES  . . ..... ........ .......... . ____ .... . .   O6

 EXHIBIT C-6:    REAL PROPERTY DAMAGE . ..... ......... . . ............. ,  C-7

 EXHIBIT C-7:    NATURAL RESOURCE DAMAGE  ............. .............   OS

 EXHIBIT C-8:   • EXPECTED YEAR IN WHICH LIABILITIES ARE INCURRED   ____ .09


 EXHIBIT D-l:    SUMMARY OF CURRENT AND 'ALTERNATIVE PRACTICES   ______  D-2

 EXHIBIT D-2:    SUMMARY OF USUAL COST ESTIMATES  ..... ........ ,, ____  D-5
         .-                ,            '                  '
 EXHIBIT D-3:    REGULATORY STATUS QUESTIONNAIRE  ...... .'.-....'... ____  D-10

 EXHIBIT D^t:    TIER 1 COST TABLES (HIDDEN REGULATORY COSTS) . ____ ....  D-12

 EXHIBIT D-5:    TIER 2 COST TABLES (FUTURE LIABILITIES)  ................  D-27

^EXHIBIT D-6:   -BENEFITS TO THE KtYPOTHETICAL FIRM OF  '         '
               SWITCHING FROM CURRENT PRACTICE TO'PP ALTERNATIVE .  .  D-30

                                    '          ••••'.••.••               '
 EXHIBIT E-l:    TREATMENT STANDARDS FOR WASTES AFFECTED BY THE
               LAND DISPOSAL RESTRICTIONS  ... ..... . ......... .... ----   E-2

 EXHIBIT E-2:    TYPICAL TREATMENT AND .DISPOSAL COSTS . . V. ...... . .....   E-7

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            - '. •  ;   ; -.     :    •   '   '•    vii     -     •••..-.."     '"    •- . ''




                             LIST OF COST TABLES


                               VOLUME i, THE MANUAL




              " -•'.     •     '  '    •'"'.'-'.-'     -   :     ''"'; ''-'•"-'  "  '.  -.       Page


 TABLE 3-1": Notification  	............_'..............	.......-..-...:-....   ' 3-9'


 TABLE 3-2:" Reporting  ...'....'..."...'.............'.... ....,...........•...".    3-11


 TABLE 3-3: Monitoring/Testing  .....	:.........	;	......    3-13


 TABLE 3-4: Recordkeeping  ........-.	•._...... ...'..•	................    3-15
*    •   '                   :         '                                   i
 TABLE 3-5: Planning/Studies/Modeling  ......	._.	    3-}7


 TABLE 3-6: Training  ..................... • -.- • • >'• •'••• ••• •........;...',.. .•>    3-19
         '       '    -     ' -                 r                    -             ' ^ '' ~ '•

 TABLE 3-7: Inspections "	.'......"..    3-21


 TABLE3-8: Manifesting  .....:.............	..........................    3-23


 TABLE 3-9: Labeling  ..... .... V. .......'...... ... .... ..'.'....".......	,..   . 3-25


 TABLE, 3-10:Preparedness/Protective  Equipment (Maintenance)  ;.-......... — ...-•••••.• ?*27


 TABLE 3-ll:Closure/Post Closure Assurance Facility-Specirlc Costs  ......... ...... .. .-,.    3-29


 TABLE 3-12:Medica! Surveillance  ....... '..........	.....ป;•....... .. ..-, ...... .3-31


 TABLE 3-13:Insurance and Special Taxes Requirement-Specific Costs  ..-......;,.......    3-33


 TABLE 3-14:Other	 .•-........... . .>.•..*.'.''  3-35

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                                   via





                         LIST OF WORKSHEETS


                           VOLUME I, THE MANUAL
WORKSHEETO:  TIER 0 - USUAL COSTS  .....'. ..... ..;.... ...... .........   2-9


WORKSHEET I:  TIER 1 - HIDDEN COSTS  ... . ............. .... ......... . ..  '3.37


WORKSHEET 11:. TIER 2 - LIABILITY COSTS .... ...........................   4.7
       \      ซ                        ,                                .


WORKSHEET W: TIER 3 - LESS TANGIBLE COSTS  .. ......... .; ..... . .......   54



WORKSHEET IV: 'COST SUMMARY , ......... . .............. ........ ......   6-13


WORKSHEET V:  FINANCIAL WORKSHEET  ........... ............... . ____   5.14



     :                     VOLUME n, APPENDICES




WORKSHEETO:  TIER 0 - USUAL COSTS  ..... ............ ...... ....... ____   A-l



WORKSHEET I:  TIER 1 - HIDDEN COSTS  .... ........ . ...... ............ i   A-3



WORKSHEET II:  TIER 2 - LIABILITY COSTS  ..... . . ____ ...... ______ .........' A-5



WORKSHEET III: TIER 3 - LESS TANGIBLE COSTS  , _____ . ..... ...... ____ . ____   A-7


WORKSHEET IV: COST SUMMARY  .......;........ ..... . . . . 1^ . . . ..;..... '  A^9



WORKSHEET V:  FINANCIAL WORKSHEET  ......... ..................... .  ''A-il

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      This manual was produced under the direction .of Dr. Ron McHugh, Office of Policy, Pluming aad
•Evaluation, U.S. EPA by ICF Incorporated.   The ICF  project .team included James Faufetich, James
Dickson, Lew French, .Michael Lochhead, James Verderese, and Joseph Karam who servo) as Project
Manager. ''Additional project direction and support was  provided by Michael Levin, Barry Korb, James'
Lbunsbury and Roben Dellingefot EPA.                 .      "  .       .......

      Initial project ideas are attributable to Dr. Gregory HoUod (Conoco Inc.), Mr. Ryan Dekambie
(Dow Chemical), and Mr. Richard  McLean (General. Electric Company).  Far too many people provided
useful insights to list all of them, but the following merit special thanks: Jack Campbell, General Electric
Capital -Corporation;  Terry  Foecke, Minnesota Technical Assistance Program; Nancy Grnndahl, EPA;
Richard Kashmanian, EPA; Tapio Kuusinen, EPA; Roger Schecter, North Carolina Pollution Preventioa
Pays; and Ned Smith, Natural Resources Defense Council.  .        .    •          .      •         .

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                                           PREFACE
        It is the policy of EPA that the reduction or elimination of discharges and/or emissions to the
 environment through source reduction and environmentalry-sonnd recycling is preferable to controliing such
 releases after they are generated or produced.  Furthermore, source reduction, or elimination of releases
 at the source, is more desirable than recycling. It will be EPA's policy to aggressively implement pollution
 prevention (PP>.through source reduction and environmentally-sound recycling as an integral pan of its
 programs to protect all aspects of our nation's  environment - air, water, land, and ground water (policy
, proposed in Federal Register, January 26,1989).

       EPA has produced this manual to simultaneously achieve increased environmental protection and
 reduced environmental  compliance costs,  Tie  purpose of the manual is to promote a complete and
 objective analysis of the economic benefits of PP projects.  Since the passage of the RCRA Hazardous and
 Solid Waste Amendments (HSWA) in 1984, EPA has been developing a program to meet the statutory goal
 to reduce or eliminate the generation of hazardous waste as expeditiousty as possible. EPA has extended
 the waste minimization (WM) concept to include releases to all environmental media. This manual refers
 to PP as  the more meaningful concept.                    .

       EPA has met  with corporate managers to discuss how PP can  be achieved  without recourse to
 additional regulations. -A major theme has been  that PP projects frequently do not get undertaken because •
 the benefits of the project in terms of reduced  raw materials, regulatory compliance, and environmental
 liability costs  are  poorly understood.   EPA has unique experience  in understanding the impacts and
 interrelationships of regulatory requirements, some of which can legitimately be avoided or mitigated
 through PP. The discussion of regulatory costs is intended to provide only an estimate of costs associated
 with regulatory compliance.  The .manual is not  designed to provide regulatory guidance.

       This manual enables you to calculate the  true cost of the current materials and waste management
 practice and then  evaluate the financial payback of the  PP alternative. .Until  these true costs, often
 underestimated by managers by an order of magnitude, are correctly understood, more hazardous material
 and waste will be managed/released than need be - thus imposing additional costs on the generator; the
 environment, and society as a  whole. EPA believes this manual to represent an extraordinary commonality
 of interests between economic self-interest and environmental protection.            ••>             .'

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                                         CHAPTER 1
                                      INTRODUCTION
       This manual is intended to help you evaluate the economic feasibility of pollution prevention (PP)
 or waste minimization (WM) alternatives to your current practice.  This introductory chapter is organized
 in five sections as follows:       .            .                     .                ;

          '   (1.1)  What is pollution prevention?                      "  .              .       .  "-.
  :  '     "  (12)  Why should yon undertake/pollution prevention?      --      ..    '     ..    '.
             (13)  What approach is used in this manual?
             (1.4)  What wfll you  get out of this manual?    .           •
             (l!s)  How is this manual organized?


 1.1   WHAT IS PQU-imON PREVENTION?                                                  .   •

       Pollution  prevention is an extension of the  concept of waste minimization.  While  pollution
 prevention includes waste minimization, it broadens the concept to include minimising the generation and
 release of all hazardous materials and wastes to all environmental  media.

      ' 1.1.1  What Does EPA Mean by Waste Minimization?

       Waste minimization means the reduction, to the extent feasible, of any solid or hazardous waste that
 you generate or subsequently treat, store, or dispose  ot  Waste minimization techniques focus  on xxati
 reduction or recycling activities that reduce either the  volume or the tanrity of your waste.  •

       Source reduction means the  reduction or elimination of hazardous waste at the source; before it is
 generated.  Recvcline. on the other hand, means the Use, reuse, or reclamation of a hazardous waste as an
 effective substitute for a commercial product or as an ingredient or feedstock in a process.  Recycling by
 use or reuse involves returning a waste material either to the originating process or another process as a
 substitute for  an input  material.  Reclamation is the  recovery pf a valuable material, or removal of
 impurities  from a waste.   Because  it is significantly more efficient and less expensive to prevent the
 generation of  hazardous waste in  the first place, you should consider source reduction to be the most
 preferable waste management Cption.. Source reduction is followed,  in order of decreasing preference, by
' recycling,  treatment, and land disposal.     ...                      -   ;  •                   .-v

  •"...' 1.1.2 What D6es EPA Mean by PollutionPrevention?                                     .

        Recently, EPA launched a major new effort to reduce the threats posed by environmental pollution.
 The Agency proposed a policy statement that established pollution prevention as an official Agency policy:

        •EPA believes that  developing and implementing a  new multi-media  prevention strategy,
       ' focused primarily on source reduction and secondarily on environmentally sound recycling,
        offers enormous promise for  improvements in human health protection and environmental
        quality and significant economic benefits.  (Federal Register, January 2fr, 1989, Page 3845)."

        This new approach is profoundly simple and yet radically different from the Agency's past efforts to
  protect health and the environment. This  approach recognizes that many of the  benefits of controlhnc
  pollution have already been achieved. Further environmental gains must come from preventing the release
  of pollutants.                 ,                    '                '.      -.''.•           . ;

        The  Agency created the Pollution Prevention  Office, which will be the Agency's focal point for an
  integrated,  cross-media approach to pollution prevention, both inside and outside the Agency. .EPA wfll

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                                                 1-2
  be actively promoting an environmental ethic stressing the prevention of pollution before it becomes a
  problem.                                                   .  •    •


  .L2   WHY SHOULD YOU U>IDERTAKE POLLUTION PREVENTION?     "
                                             ,       s',ป

        Your finn should investigate and implement PP alternatives to your current practice for several
,  reasons.  Pollution prevention can help you achieve the following: •         •     •  .

        (1)   Improve your firm's "bottom line;'        •'•'.•

        (2)   Make compliance with environmental regulations easier; and

        (3) ' Demonstrate a proactive commitment to genuinely pursuing a PP program

        EPA has developed a system of federal regulations to protect human health and the environment
  from  dangerous wastes and materials.  Although EPA has tried to avoid imposing unnecessary costs upon
  private industry as  a result of these regulations; EPA understands that  private industry may  still face
  significant compliance costs.. Pollution prevention can improveyour firm's bottom line as a result of:

        •      Reduced process costs;

        •      Reduced regulatory  costs;    '  " .                                        '

        •      Reduced liability costs; and                             •

        •     Less tangible  benefits resulting from improved  customer satisfaction  and
             enhanced corporate  image.                     "              .       •.'--•

       If you are like most owners or operators of businesses regulated by the US. EPA and/or at state
environmental agency, you have complied with the new regulations by adding equipment to deal with wastes
after they are generated.  For example, you may have added wastewater and process-water treatment
equipment or air pollution control equipment like  stack scrubbers or electrostatic precipitators and filters.
Also,  you may  have contracted with vendors who  have permits to dispose  of. your hazardous wastes.
However,  many manufacturers have found that  the  most cost-effective  approach to  complying  with
environmental regulations'is to minimize or avoid generating or releasing hazardous materials or wastes in
the first place; ซ., to prevent  the pollution before it occurs. Many firms have found that by "couplinc"
pollution  prevention with other corporate goals (e.g., efficiency, R&D, health and safety) not only haw
costs been cut, products been improved, or processes been enhanced, but also compliance with regulations
has become easier!  For example, a search for a less expensive, more effective cleaning solvent may lead to
use of an  aqueous cleaner that also generates less hazardous waste. Attempting to reduce the down-time
cue to cleaning and  rinsing of equipment associated with batch-processing may result in rearranrine the
process sequence so  that  the wastes from the previous batch are compatible with the inputs for the next
batch,  which  may also reduce the amount of wastewater  generated.

       Furthermore, you must certify on your hazardous waste manifests that you have a program in place
to reduce  the volume and toxicity  of the waste you generate  and you must describe this program  in your
biennial reports. Any waste minimization or pollution .prevention efforts you take now will not only result
in immediate economic benefits to your firm, but wall also serve to demonstrate a proactive commitment
to genuinely pursuing a pollution prevention program.

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                                               1-3
       WHAT APPROACH IS USED IN THIS MANUAL?
       Your decision to select a PP alternative to current practice, however, is often an economic one.  To
 Bake a particular selection you may need to know how much a PP alternative wffl costj rda y itoyour
 OTiem practice. The purpose ttf ^manual is. to help you make tfus companion* the baas of the •me
 costs and benefits of preventing poOution.  '            ' .                              . ,      .  .

       Exhibit 1-1 Illustrates the general approach taken by this manual. As jrbu can see, the economic
 evaluation  of a PP alternative can be performed at four levels. or tiers.  At each tier, the economic..;
 evaluation is  a two-step process:       •                     •                                 ;      ;
                 ป          '      ,                ..•,.."'._.
         SteD v  .   Aecnnnt for ปii costs associated with current practices and with the alternative
         ?  "•- '     pfproiect: This manual  describes  four tiers or levels of costs associated with
                    hazardous wastes and materials management:   usual costs, hidden regulatory
                   • costs, liability costs, and less tangible costs.                    '

     .   steo2-    'Estimate' kev financial indicators of the economic viability of the PP project on
         — *—'•    thf hasis of Step 1 costs:  This manual describes the financial calculations for
                    estimating net present value, internal rate of return, and annualized cost savings    .
                    of a PP project

 In Exhibit  1-1 the four peripheral boxes represent the four tiers of the cost calculations (Lt, Step 1). The
 ฃrS5 *L repaints the Ibuttl calculations (Le., Step 2). Note that the same financial calculauons are.
 performed  in each tier of the economic evaluation.

       The manual describes procedures or protocols for performing the cost and financial calculations.
 After performing the cost protocol associated  with a tier, you should use the financial protocol to evaluate
 the e^nomTmerits of the PP alternative.  Each tier is evaluated using the same basic techniques.  Qnry
 you SI deSne S>e appropriate level of analysis to employ; not everyone will need or choosfc to employ ,
 all four tiers of the analysis.                  ,                       :     "

     N 13.1  Four-Tier Cost Protocol               1                   :,                      ;

        The manual describes four "tiers' or levels of costs associated with hazardous materials and 'waste
  management. You may go through as many tiers as necessary to demonstrate ti* economic ^viability  of
  SpP^rqjea:  The four costfe are summari^  next.-  Note that. Tiers 2 and 3 are judgmental .to
•  nature   You are encouraged to be conservative in your cost ซtimates thus reflecting youremphasis raPP
  S ft ?goal i ฃ not profit nfaximization.  If you get to Tiers 2 and 3, your estimates of Uabihty costs and less
  tangible benefits will reflect subjective corporate , policy vand not, precise, saentific calculations.   .

        Tier 0-addresses the -usual' capital and O&M costs associated. with new technology and operating
  practices ~  labor costs, equipment costs, raw materials 'costs, etc.  In this manual, EPA has assumed that
            conducted or will conduct an evaluation of usual costs by  using other EPA guidance, internal,
            SJerience, or outside consultants.  To use this manual, you wfll need to prov,de the Tier 0 cost
  estimate.
         tier   1  includes  Tudden'  costs  associated  with  pollution  practices  -  permitting  costs,
       itorinErtesting costs, training costs, inspection costs, and other regulatory costs.  In some cases, these
        ซTbe"Scant and pollution prevention can lower them. These costs aret