EPA
TVA
United States
Environmental Protection
Agency
Industrial Environmental Research
Laboratory
Research Triangle Park NC 27711
EPA-600/7-80-131
July 1980
Tennessee Valley
Authority
Office of Power
Energy Demonstrations
and Technology
Muscle Shoals AL 35660
TVA EOT-I 15
         Projection of  1985
         Market  Potential for FGD
         Byproduct Sulfur and
         Sulfuric Acid  in  the U.S.

         Interagency
         Energy/Environment
         R&D Program  Report


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                  RESEARCH REPORTING SERIES


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     2. Environmental Protection Technology

     3. Ecological Research

     4. Environmental Monitoring

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     6. Scientific and Technical Assessment Reports (STAR)

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 This report has been assigned to the INTERAGENCY ENERGY-ENVIRONMENT
 RESEARCH AND DEVELOPMENT series. Reports in this series result from the
 effort funded under the 17-agency  Federal Energy/Environment Research and
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                        EPA REVIEW NOTICE
This report has been reviewed by the participating Federal Agencies, and approved
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tion Service, Springfield, Virginia 22161.

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                                       EPA-600/7-80-131
                                       TVA EDT-115
                                                  July 1980
       Projection of 1985  Market
     Potential for FGD Byproduct
Sulfur and  Sulfuric  Acid  in the U.S
                          by

              W.E. O'Brien, W.L Anders, and J.D. Veitch

                     TVA, Office of Power
            Division of Energy Demonstrations and Technology
                 Muscle Shoals, Alabama 35660
             EPA Interagency Agreement No. D9-E721-BI
                  Program Element No. INE624A
                EPA Project Officer: Julian W. Jones

             Industrial Environmental Research Laboratory
           Office of Environmental Engineering and Technology
                Research Triangle Park, NC 27711
                       Prepared for

             U.S. ENVIRONMENTAL PROTECTION AGENCY
               Office of Research and Development
                   Washington, DC 20460

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                                DISCLAIMER
     This report was prepared by the Tennessee Valley Authority and has
been reviewed by the Office of Energy, Minerals, and Industry, U.S.
Environmental Protection Agency, and approved for publication.  Approval
does not signify that the contents necessarily reflect the views and
policies of the Tennessee Valley Authority or the U.S. Environmental
Protection Agency,  nor does mention of trade names or commercial products
constitute endorsement or recommendation for use.
                                    ii

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                                  ABSTRACT
     The 1985 U.S. FGD byproduct sulfur and sulfuric acid markets
(sales to U.S. sulfuric acid plants) are projected to be 165,000 tons of
sulfur from 11 power plants and 554,000 tons of acid from 6 power plants,
with a combined benefit to the affected industries of $20 million.
Improvements in FGD technology and increases in costs, particularly for
fuel oil, enhanced the FGD sulfur market potential and decreased the FGD
sulfuric acid potential, relative to previous projections.  The 1979
revised NSPS, as well as the requirement, in many cases, for FGD waste
treatment, improved the potential for both products.  The revised NSPS,
which restrict  the  use of low-sulfur coal as an option, greatly increase
the FGD market potential for plants coming on-line after the mid-1980's.
Fuel oil cost escalation is an important factor in reducing FGD sulfuric
acid market potential, as are process modifications for chloride control.
Limestone scrubbing with waste sludge ponding remains the economically
predominant option.  The limestone scrubbing advantage is decreased,
however, when extensive waste treatment and landfill are required.
                                    iii

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                                 CONTENTS


Abstract	ill
Figures	    vi
Tables	vii

Executive Summary  	    ix

Introduction 	     1

Results  	     5
  Potential 1985 Supply and Demand 	     6
    Power Plants	     6
    Sulfuric Acid Plants 	     6
    Model Runs for the 1985 Projection	     7
  FGD Byproduct Sulfur 	     8
    Sulfur Production Versus Limestone Scrubbing With Sludge
     Ponding	     8
    Sulfur Production Versus Limestone Scrubbing With Sludge
     Fixation and Landfill 	     9
  FGD Byproduct Sulfuric Acid	    10
    Effects of No.  6 Fuel Oil Price Escalation	    12
    Chloride Removal Required  	    15
    Chloride Removal Not Required  	    15
    Sulfuric Acid Production Versus Limestone Scrubbing With
     Sludge Ponding  	    15
    Acid Production Versus Limestone Scrubbing With Sludge
     Fixation and Landfill 	    16
  Integrated Analysis  	    19
    Combined Sulfur and Sulfuric Acid Results  	    20
    Strategy Selection Summary 	    21
  Discussion of Results  	    23
    FGD Byproduct Sulfur 	    23
    FGD Sulfuric Acid	    24
    FGD Sulfur Versus FGD Sulfuric Acid	    24

Conclusions	    25

Recommendations  	    27

References	    28

Appendix
  A.  Byproduct Marketing System Description 	    31
  B.  System Revisions and Additions for 1985	    41

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                                  FIGURES
Number
                                                                       Page
  1     Increase in FGD sulfuric acid production cost with No. 6
        fuel oil annual price escalation 	    13
  2     Decrease in sulfuric acid plant avoidable production
        cost due to steam credit with No.  6 fuel oil annual price
        escalation	    14
  3     Reduction in potential FGD sulfuric acid margin with
        No.  6 fuel oil annual price escalation	    14

 A-l    Computerized FGD byproduct production and marketing system .    32
 A-2    Limestone scrubbing and ponding  	    34
 A-3    Limestone scrubbing and landfill 	    36
 A-4    Magnesia process 	    37
 A-5    Magnesia process without chloride  scrubbing  	    38
 A-6    Rockwell International ACP 	    39
 B-l    Sulfur capacities by source (1967-1985)  - United States  .  .    44
 B-2    Sulfur capacities by source (1967-1985)  - Canada 	    45
 B-3    Sulfur capacities by source (1967-1985)  - North America  .  .    46
 B-4    Cost-competitive ranges for Canadian sulfur at different
        f.o.b.  Canadian sulfur prices (short ton) below Port
        Sulphur price	    48
 B-5    Sulfuric acid capacities by feedstock (1967-1985)  -
        United States  	    49
 B-6    Sulfuric acid capacities by feedstock (1967-1985)  -
        Canada	    50
 B-7    Sulfuric acid capacities by feedstock (1967-1985)  -
        North America	    51
                                   vi

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                                  TABLES
Number                                                                 Page

 S-l    Production and Distribution FGD Sulfur and FGD Sulfuric
        Acid	xiii
   1    Sulfur Production Versus Limestone Scrubbing With Sludge
        Ponding  	      9
   2    Sulfur Production Versus Limestone Scrubbing With Sludge
        Fixation and Landfill  ($0.70, $1.00, and $1.25 ACFL)   ....     11
   3    No. 6 Fuel Oil Escalation Compared With Energy Equivalent
        Increases in Natural Gas and Coal	     12
   A    Acid Production  (No Chloride Scrubbing) Versus Limestone
        Scrubbing With Sludge  Ponding ($0.70, $1.00, and $1.25 ACFL).     16
   5    Acid Production  (No Chloride Scrubbing) Versus Limestone
        Scrubbing With Sludge  Fixation and Landfill ($0.70 ACFL)   .  .     19
   6    Acid Production  (No Chloride Scrubbing) Versus Limestone
        Scrubbing With Sludge  Fixation and Landfill ($1.00 and
        $1.25 ACFL) ,	     18
   7    Competitive Production and Distribution FGD Sulfur Versus
        FGD Sulfuric Acid	     22
                                   vii

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            PROJECTION OF  1985 MARKET POTENTIAL FOR FGD BYPRODUCT

                SULFUR AND SULFURIC ACID IN THE UNITED STATES



                             EXECUTIVE SUMMARY
 INTRODUCTION

     Emission of sulfur oxides  (SOX) from coal-fired utility power
 plants, and wastes resulting from their control, have been subjected to
 increasingly stringent regulations during the past decade.  The new-
 source performance standards (NSPS) promulgated by the U.S. Environmental
 Protection Agency (EPA) in 1971, the revised 1979 NSPS, and State imple-
 mentation plans  (SIP's) place restrictions of varying severity on SOX
 emissions.  In addition, the Resources Conservation and Recovery Act
 (RCRA) of 1976 has placed restrictions on disposal of wastes from
 processes used to meet the emission regulations.

     The use of a clean (low-sulfur) fuel and flue gas desulfurization
 (FGD) are the strategies commonly used to meet SOX emission regulations.
 FGD is for some time likely to be the method used to meet the 1979
 revised NSPS, which require SOX emission reduction regardless of the
 fuel sulfur content.  Among the several FGD processes and their numerous
 variations, scrubbing with a slurry of ground limestone or lime is the
 most widely used.  The large volume and intractable nature of the waste
 sludge have led increasingly to additional treatment.   Dewatering and
 chemical treatment (fixation) to form a landfill material is becoming a
 common practice.  Recovery processes in which the scrubber effluent is
 processed to recover the absorbent and produce a sulfur byproduct can
 also be used.  They are usually more expensive than waste-producing
 processes, but the sale of the byproduct can partially alleviate the
 additional cost of the FGD process.  Among several of the more promising
 recovery processes are the magnesia process and the Rockwell Inter-
national aqueous carbonate process (ACP).   In the magnesia process the
 S02 produced by regeneration of the MgO absorbent is converted to sulfuric
acid.   The ACP is unique among recovery processes in that it uses spray
dryer technology.  The spent absorbent is collected as a dry material.
Residual fly ash is also removed in the process, eliminating the need of
a separate high-efficiency fly ash removal system.  The salts are reduced
using coal as the reductant and further processed to regenerated absorbent
and sulfur.

     Utilities selecting an SOX emission control strategy are faced with
a variety of complex decisions in which the economics of the possible

                                     ix

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strategies are important factors.  The relative economics of clean fuel,
waste-producing FGD, and recovery FGD strategies are seldom clearly
evident.  FGD costs vary widely depending on power plant and fuel con-
ditions.  The economics of recovery processes are affected by the
marketability and price of the byproduct.  In addition, the comparisons
must be based on conditions that will exist several years in the future.
This byproduct marketing projection is an attempt to integrate the many
factors affecting SOx emission control strategies into a coherent com-
puter model that projects the future potential for marketing FGD
byproducts as an economical strategy.

     The byproduct marketing system consists of various programs, models,
and data bases used to make cost comparisons of SOx emission control
strategies.  A power plant data base contains boiler, fuel, and emission
regulation data on existing and planned U.S. utility power plants.  For
recovery processes transportation and sulfur-sulfuric acid industry data
bases are used to determine the marketability and price of the FGD
byproduct.   The system determines FGD costs of a recovery process and a
waste-producing process for each power plant.  As an alternative strategy,
the use of clean fuel at specified price premiums (alternative clean
fuel levels—ACFL's) is also included.  The cost difference between the
recovery process and the lowest cost alternative strategy (the incre-
mental cost) is used to determine the byproduct revenue required to make
the two strategies economically equivalent.  Marketability is determined
in a linear programming model that determines transportation costs and
selling prices at the U.S. sulfuric acid plants.  The model integrates
the results to maximize the combined savings to the utility and sulfuric
acid industries.  The power plants for which markets are established
become projected FGD byproduct marketing candidates.

     This 1985 projection contains several revisions representing
economic, technical, and regulatory conditions that promise to have
important effects on the economics of SOX emission control.  The design
of the FGD processes has been revised to include recent technology,
including chloride removal in a separate step for process and corrosion
control in the magnesia process and sludge fixation and landfill as a
disposal option in the limestone scrubbing process.  The use of the ACP
for sulfur production has also altered FGD cost relationships.  In
addition, inclusion of the 1979 revised NSPS and projected 1985 costs
for fuels have had important effects.
RESULTS

Power Plants

     For 1985, 124 eligible boilers at 83 power plants are included in
the projection; 74 scheduled to be on stream by 1979 and 50 scheduled
for startup in 1980-1985.  The number of eligible boilers is lower than
the number in previous projections because of a trend toward earlier
strategy selection (boilers for which a strategy precluding byproduct
production has been announced are excluded).  Of the 50 eligible boilers
(out of a total of 170 boilers) scheduled for 1980-1985 startup, 21 are

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scheduled for 1985.  The increase in 1985 is the result of  the arbitrary
assignment of the 1979 revised NSPS to boilers starting up  in 1985,  thus
excluding clean fuel alone as an SOX emission control strategy.   The 124
boilers are projected to represent a maximum potential production of 2.5
million tons of sulfur or 7.6 million tons of sulfuric acid.

Computer Model Runs for 1985

     ACFL values of $0.70, $1.00, and $1.25/MBtu were used  for the clean
fuel premium.  The FGD byproduct alternatives used were sulfur production
and sulfuric acid production with and without chloride removal included
in the magnesia process.  These were compared with limestone scrubbing
with ponding and limestone scrubbing with fixation and landfill.

Sulfuric Acid Plants and Smelters

     In 1985, 87 sulfur-burning acid plants consuming 10 million tons of
sulfur and producing 30.5 million tons of sulfuric acid are projected to
be in operation, 75 of which are in the Eastern United States.  Smelter
sulfuric acid production is projected to be about 1 million tons in
1985.  The eastern acid plants represent the market for FGD byproducts.
Smelter sulfuric acid represents competition for FGD byproducts.

FGD Byproduct Sulfur

     For the comparison using limestone scrubbing with ponding, there
are four potential candidates for FGD sulfur production.  All four are
1985 plants subject to the 1979 NSPS and excluded in this study from the
clean fuel option, which would have been more economical at the $0.70/MBtu
ACFL.  Their potential production is about 63,000 tons/year.  When
limestone scrubbing with fixation and landfill is the waste-producing
alternative, the number of potential candidates for sulfur production
increases to 12, 8 of which are  1985 plants subject to the 1979 NSPS.
Their potential production is 215,000 tons/year.

     For the comparison using limestone scrubbing with ponding, markets
for the entire production of the four potential candidates for FGD
sulfur production are projected.  For the comparison using limestone
scrubbing with fixation and landfill, markets for 11 of the 12 candidates
are projected.  The remaining plant does not have markets for which the
incremental cost plus transportation costs do not exceed the acid plant's
sulfur cost from other suppliers.  Under the most favorable conditions
the potential market is 165,000  tons, representing about 1.6% of the
total sulfur market.

FGD Sulfuric Acid

     For the comparisons using the magnesia process with chloride removal,
there were no power plants selected as potential candidates for sulfuric
acid production.  There are four potential candidates using the magnesia
process without chloride removal in comparison with limestone scrubbing
with ponding.  Two of the four potential candidates for sulfuric acid

                                     xi

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 production would  have  been  selected  for  clean  fuel at the $0.70/MBtu
 ACFL but are subject to  the 1979  revised NSPS.  The four plants have a
 combined potential  production  of  300,000 tons/year.  For the comparison
 using the fixation  and landfill disposal option,  13 plants with a combined
 production of 2 million  tons/year are projected as potential candidates
 for sulfuric acid production at the  $0.70/MBtu ACFL.  Of these, six
 plants are subject  to  the 1979 revised NSPS.   At  the higher ACFL's of
 $1.00 and $1.25 there  are 15 additional  plants, making a total of 28
 plants with a combined potential  production of 4  million tons/year.

      For the comparison  using  limestone  scrubbing with ponding, markets
 are projected for two  of the four plants.  For the comparison using
 fixation and landfill, markets are projected for  4 of the 13 plants at
 the $0.70/MBtu ACFL and  for  8  of  the 28  plants at the higher ACFL's.
 Under the most favorable conditions, the potential market is 868,000
 tons,  or about 3% of t"he total sulfuric  market.

 Integrated Sulfur-Sulfuric Acid Results

      When the sulfur and sulfuric acid projections were combined (Table S-l)
 several conflicts were resolved by choice of the  most economical option
 for power plants  projected  for both sulfur and sulfuric acid production.
 There was little  difficulty  in assigning alternative markets for sulfur
 but few alternative sulfuric acid markets were found.  The FGD sulfur
 market is projected at about 165,000 tons/year from 11 power plants.
 The FGD sulfuric  acid  market is projected at about 554,000 tons/year
 from six power plants.  The  combined potential market is about 2% of the
 total sulfuric acid market and 1.6% of the total  sulfur market.  The
 combined benefits for  the electric utility and acid industries are about
 $10 million each  for sulfur  and sulfuric acid, for a total benefit of
 about  $20 million in 1985.
DISCUSSION OF RESULTS

     About four-fifths of the power plants projected for sulfur mar-
keting are scheduled for startup in 1985 and are therefore defined in
this study as new plants subject to the 1979 revised NSPS.  The prepon-
derance of plants scheduled for startup in 1985 projected for sulfur
marketing is partly the effect of the AGP design, which includes provision
for final fly ash removal.  Separate fly ash electrostatic precipitators
(ESP's) are not needed and the capital and operating costs are applied
as a cost credit, whereas in pre-1985 plants they are assumed to be in
existence and only operating costs are credited.  Another factor favoring
plants scheduled for 1985 startup is the 1979 revised NSPS, which
restrict the use of clean fuel as a compliance strategy.

     The total sulfur removed also has an effect on strategy selection.
In comparisons with limestone scrubbing and with acid production, sulfur
production is favored at lower sulfur removal levels.

     FGD sulfur marketing potential increased dramatically in this
projection, whereas FGD sulfuric acid marketing potential declined in

                                    xii

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        TABLE S-l.  PRODUCTION AND DISTRIBUTION FGD

               SULFUR AND FGD SULFURIC ACID

Power plant location
Sulfur
Staten Island County, NY
Martin County, FL
Washington County, FL
Sherburne County, MN
Westmoreland County, PA
Montgomery County, MD
Shelby County, AL
Williamson County, IL
Rusk County, TX
Henderson County, TX
Armstrong County, PA
Sulfuric Acid
Person County, NC
Jasper County, IL
Pike County, IN
Northhampton County, PA
Delaware County, PA
Titus County, TX
Tons
7,000
28,000
20,000
8,000
24,000
10,000
12,000
11,000
9,000
7,000
29,000
165,000a
103,000
122,000
51,000
182,000
53,000
43,000
554,000b
Consumer location
Newark, NJ
Pierce, FL
Do than, AL
White Springs, FL
Dubuque, IA
North Bend, OH
Copley, OH
Baltimore, MD
Tuscaloosa, AL
East St. Louis, IL
Fort Worth, TX
Fort Worth, TX
Cleveland, OH
Richmond, VA
Wilmington, NC
Norfolk, VA
Tuscola, IL
Indianapolis, IN
Deepwater, NJ
Edison, NJ
Gibbstown, NJ
Gibbstown, NJ
Shreveport, LA
Tons
7,000
28,000
7,000
13,000
8,000
8,000
16,000
10,000
12,000
11,000
9,000
7,000
29,000
165,000a
36,000
26,000
41,000
122,000
51,000
95,000
74,000
13,000
53,000
43,000
554,000b
The potential revenue/savings to both-industries combined is
projected to be as much as $10,000,000 for an approximate
average of $60/short ton of sulfur.
The potential revenue/savings to both industries combined is
projected to be as much as $10,500,000 for an approximate
average of $19/short ton of sulfuric acid.
                         xiii

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 comparison with previous projections.   These changes are partially the
 result of the process design changes already discussed.   Another very
 important factor, however, is the price escalation for fuel oil.   This
 is a severe disadvantage to the magnesia process in competition with the
 limestone scrubbing process, which uses little fuel, and the AGP, which
 uses coal.  In addition, sulfuric acid plants converting to purchase of
 FGD sulfuric acid are likely to revert to oil-fired boilers for steam
 production, a further disproportionate deterioration of  the avoidable
 production costs.  Transportation costs are also more important to the
 relatively high-volume sulfuric acid than to sulfur.  The combined
 effects result in the reduced competitiveness of FGD sulfuric acid
 production vis-a-vis other compliance  strategies.

      The increased attractiveness of FGD sulfur production as a com-
 pliance strategy can be attributed in  part to the use of the ACP.
 Arguably, it is an unproven process, subject to the same technological
 cost increases seen in this projection in the magnesia process and in
 FGD processes in general.   Other relative cost advantages of the  ACP
 over FGD byproduct processes using wet scrubbing,  such as reduced or
 eliminated flue gas reheating and simultaneous fly ash and sulfur salt
 collection,  are unlikely to be greatly affected.

      The inclusion of fixation and landfill as a disposal option  for the
 limestone scrubbing process improved the competitiveness of FGD byproduct
 processes.   Limestone scrubbing remains  the most economical FGD strategy
 in the majority of cases,  however.
 CONCLUSIONS

     The  potential  for FGD sulfur marketing is increased over previous
 projections whereas  the FGD sulfuric acid marketing is decreased.
 Technological and economic revisions to the byproduct marketing system
 both contribute  to  these trends.  Application of the 1979 revised NSPS
 and more  costly  waste disposal methods for limestone scrubbing enhance
 the potential for both FGD sulfur and FGD sulfuric acid.

     The  addition of chloride scrubbing to the magnesia process, coupled
 with cost escalations (especially fuel oil), eliminated the FGD sulfuric
 acid market shown in previous projections.  Processes that can use coal
 as the FGD byproduct energy source will have increasing economic advantages
 over those which use fuel oil or natural gas.

     In the ACP, simultaneous removal of SOX and the remaining fly ash
 in the same ESP  presents an advantage for new (1985) plants when compared
with alternative FGD processes which require separate high-efficiency
 fly ash removal.

     The number of power plant candidates for FGD byproduct marketing
will increase with the application of the revised NSPS.   It is estimated
that this will affect boilers with startup dates in and after 1985.   The
                                    xiv

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majority of boilers coming on stream before 1985 have selected a clean
fuel compliance strategy that will not generally be an option for future
plants covered by the revised NSPS.

     The potential for FGD sulfur and sulfuric acid byproduct marketing
is extremely limited when limestone scrubbing with slurry ponding is a
feasible alternative.  Potential for production and marketing of FGD
byproducts increases when fixation and landfill are required.

     Escalation of transportation costs will affect the marketing range
of byproduct sulfur and, especially, byproduct sulfuric acid.  Rail rate
increases will also affect the marketing range of competitive sources of
sulfur and sulfuric acid, however.

     Nonvoluntary sulfur production is becoming a more important factor
in the marketing economics of FGD byproduct sulfur.  The effect of
nonvoluntary sources on price stability in the sulfur market is diffi-
cult to project.
RECOMMENDATIONS

     An FGD sulfur and sulfuric production and marketing forecast should
be projected for 1990 or beyond.  This projection to 1985 reflects only
the beginning of the effects of the 1979 revised NSPS.  Also, the lead
time required to analyze and implement FGD strategies necessitates a
more extended time frame.

     Technical and economic developments in spray dryer FGD recovery
processes should be followed closely.   Also, developments allowing the
use of coal for FGD byproduct processes should be incorporated into
future studies.

     Future studies should include projections of fertilizer industry
requirements to expand the demand system beyond existing and announced
sulfuric acid plants.

     Projected demand for sulfur for new uses, such as partial or full
replacement of asphalt in paving, should be included.

     The supply of refinery recovered sulfur should be projected because
of the potential increase in use of high-sulfur crude oil.

     A specific byproduct marketing study should be made for the approxi-
mately 100 power units designated by the Department of Energy for conver-
sion from oil to coal.  Many of these plants are in high-population
areas where disposal of wastes, if FGD were required, would be difficult.
                                    xv

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           PROJECTION OF 1985 MARKET POTENTIAL FOR FGD BYPRODUCT

               SULFUR AND SULFURIC ACID IN THE UNITED STATES



                               INTRODUCTION
     Sulfur oxides (SOX) are the major gaseous pollutants currently
subject to environmental regulations in the flue gas of fossil-fuel-
fired boilers.  Coals, which may contain up to several percent sulfur,
are the predominate contributors to these emissions, and the electric
utility industry with its many coal-fired plants is an important source.
Increasing electrical use and increasing emphasis on coal as the pre-
ferred fossil fuel for utility use are expected to increase the quantity
of coal consumed in electricity generation for many years (Griffith and
Clarke, 1979).  The use of coal, however, is particularly sensitive to
the increasingly strict environmental regulations governing the emission
of SOX to the atmosphere and disposal of wastes produced by control of
SOX emissions.  In addition to a proliferation of State and local regula-
tions, the new-source performance standards (NSPS) promulgated by the
U.S. Environmental Protection Agency (EPA) in 1971 (Federal Register,
1971), the revised NSPS promulgated in 1979 (Federal Register, 1979a),
and solid-waste regulations stemming from the Resources Conservation  and
Recovery Act  (RCRA) of 1977 (Federal Register, 1979b) are particularly
important to electric utilities.  The NSPS restrict plants upon which
construction began after 1971 but before September 1979 to a maximum
emission of 1.2 Ib of SOX per million Btu of fuel.  The revised NSPS,
applying to plants upon which construction began, or begins, after
September 1978, retain  the  same maximum and, in addition, require a
reduction of 70% to 90% in sulfur emissions regardless of the sulfur  in
the untreated fuel.  RCRA, though not fully defined by promulgated
regulations, will restrict and possibly eliminate some methods of waste
disposal.

     Numerous strategies, existing and potential, can be applied to the
control of fossil-fuel power plant SOX emissions.  Some are applicable
to all emission regulations, some are applicable to only the less strin-
gent regulations, and some may be circumscribed by RCRA regulations.
The most widely used SOX control strategy is flue gas desulfurization
(FGD) using wet or dry scrubbing techniques,  In .the past 10 years a
flourishing FGD industry has developed, offering a proliferating variety
of FGD processes.  Another strategy is the use of a clean (low-sulfur)
fuel.  There is, however, a limited supply of low-sulfur coal, and this
strategy will be restricted by the requirements of the  1979 revised

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 NSPS.   Other approaches  such  as  coal  gasification and fluidized-bed
 combustion are  not  advanced to the  level of  technology likely to make
 them a widely used  SOX control strategy in the next 5 years.  Within the
 time span of this marketing projection, the  use of clean fuel to meet
 some non-Federal and  1971 NSPS regulations and FGD to meet any applicable
 regulation are  likely to be the  overwhelmingly predominate SOX control
 strategies of the electric utility  industry.

      The  most widely  used FGD processes employ wet scrubbing using an
 alkali solution or  slurry to  produce  a waste slurry of calcium-sulfur
 salts.  Finely  ground limestone  and hydrated lime have been the most
 widely used absorbents,  a use projected to continue well into the 1980's
 (Smith et al.,  1979).  In the simplest method of disposal, the waste is
 pumped to a diked pond where  it  settles to a semisolid sludge.  The
 large  volume of unstable waste presents a number of practical and environ-
 mental disposal problems, however, particularly in view of RCRA regula-
 tions  (Duvel et al.,  1979).

      Increasingly,  utilities  using  limestone scrubbing are turning to
 dewatering,  stabilization, and fixation of the waste.  In the more
 extreme of these treatments,  the FGD waste is transformed to a solid
 suitable  for landfill disposal.  This usually involves mechanical
 dewatering of the FGD sludge, blending it with dry fly ash (stabiliza-
 tion),  and adding a chemical  additive to promote cementlike reactions
 (fixation).   The degree  to which waste treatments between untreated
 ponding and full chemical fixation will be widely employed is problem-
 atical, although some form of waste treatment is increasingly used and
 several utilities use full fixation and landfill processes (Santhanam et
 al.,  1979).

     As an alternative to waste-producing FGD processes, recovery
 processes in which  the scrubber reaction products are processed to
 regenerate the  absorbent and produce a commercially useful sulfur by-
 product have also proven attractive.  Although sharing a contemporaneous
 development  with waste-producing processes, the more complex, and usually
 more expensive, recovery processes have not been as widely used by
 electric  utilities.   Recovery processes are, however, in commercial use
 or under  construction and several are in advanced stages of development.
 The products  most widely produced or envisioned for these processes are
 elemental sulfur and  sulfuric acid, both extensively used basic industrial
 chemicals.

     Utilities  faced with the selection of an SO  emission control
 strategy  thus have  a variety of complex decisions.  In the most general
sense,  the choice evolves to the use of a clean fuel or to the use of
one of  several types of FGD processes and is governed, within the con-
strictions of the applicable regulations, by economic considerations.
The most  economical choice is seldom clearly evident, however.  FGD
costs vary widely,  even for the same process, depending on many power
plant and fuel conditions.   The selection of a recovery process also
depends in important measure on the marketability of the byproduct whose
revenue reduces  the operating cost of the process.  The selection is

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 dependent not only on conditions at the particular power plant, but upon
 selections at other power plants as well as conditions within other
 supportive or competing industries.  An economically sound decision to
 use  a  recovery process based on a certain market could be invalidated by
 the  same decision elsewhere.  Marketing decisions are also influenced by
 the  costs of transportation and competition from other producers.

     Further complicating these decisions is the necessity of projecting
 to anticipated conditions several years in the future.  The necessity of
 securing regulatory agency approval and extended construction periods
 combine to extend the effects of current decisions into a more distant
 and  less certain future.

     This byproduct marketing projection is an attempt to correlate
 these  many and diverse factors into a coherent model, a decision-making
 tool which defines the future potential for marketing of FGD byproducts
 as an  economical option for compliance with SOX emission regulations.
 Perhaps equally important, it also identifies trends and the factors
 responsible, through which future and correlative analyses may be more
 efficiently applied.

     For the past decade, the Tennessee Valley Authority (TVA), in
 conjunction with EPA and others, has conducted design and economic
 evaluations of FGD systems to develop a systematic analysis of FGD costs
 applicable to both general and specific conditions in the electric
 utility industry.  The byproduct marketing analysis system has been an
 important part of these studies.  From a limited computerized production-
 transportation-marketing program (Waitzman et al., 1973), the methodology
 was expanded and extended to other products (Corrigan, 1974; Bucy et
 al., 1976), and finally to a comprehensive analysis of potential sulfuric
 acid production and marketing by U.S. electric utilities (Bucy et al.,
 1978).  The byproduct marketing system used in the 1978 projection was
 made available for general use, in whole or in part, through publication
 of a users manual (Anders, 1979).

     In recognition of the rapidly changing FGD technology and the need
 to extend such projections as far as possible into the future, the
 byproduct marketing system has been continually modified to represent
 current projections of technological and economic conditions.  An update
 extending the 1978 projection to 1983 and incorporating byproduct sulfur
 in addition to sulfuric acid was published in 1979 (O'Brien and Anders).

     In addition to extending the project to 1985, this study incorporates
 the effects of several technological and legislative developments and
 recent economic trends.  The limestone scrubbing FGD process used for
 the waste-producing option has been expanded to include both untreated
 ponding and fixation and landfill as waste disposal options.  The magnesia
 process used for the sulfuric acid production option has been modified
 to include recent technical developments.  In particular, provisions for
prescrubbing to remove chlorides from the flue gas before S02 absorption
have been added.   Operating experience with closed FGD systems, in which
 the absorber liquid is recycled, has revealed that the chloride content

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of  flue  gases produced by many coals is sufficient to cause intolerable
accumulations of chlorides in the recycled liquid.  High levels of
dissolved chlorides cause severe corrosion and interfere with the SC>2
absorption and absorbent regeneration reactions.  For the sulfur produc-
tion option, the Rockwell International aqueous carbonate process (ACP)
is  used  in recognition of rapidly developing FGD spray dryer technology.
Spray dryer FGD processes include final fly ash collection as an intrinsic
part of  the process.  Final fly ash removal can be included in this
function, eliminating the need for separate high-efficiency fly ash
collection facilities.  The effects of the revised NSPS, which restrict
clean fuel as a compliance option for boilers coming on-line at the end
of  the projection period, have also been incorporated into the system.
More recent cost data, particularly those representing recent projections
of  fuel  costs, have also been included.

     A full description of the processes used in the byproduct marketing
system (except for the ACP)  and the design and economic premises upon
which they are based have been published in recent TVA and EPA studies
(Anderson et al.,  1980).   A  description of the byproduct marketing
computer system and a brief  description of the FGD processes are given
in Appendix A.   [A more detailed description of the computer system is
contained in the  users manual (Anders,  1979).]   A description of computer
system revisions  and additions specific to the 1985 projection is given
in Appendix B.

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                                 RESULTS


     The results from the  1985 projection show that changing economic,
technological, and regulatory conditions have had significant effects on
the feasibility of producing and marketing FGD sulfur and sulfuric acid.
Previous model results, projected for 1978 and 1983, were based only on
the following regulatory compliance alternatives:

   •  Use of clean fuel

   •  Limestone scrubbing with sludge ponding

   •  Magnesia scrubbing (under the existing technology without chloride
      removal) with byproduct sulfuric acid production

     For the 1985 projection these alternatives are no longer adequate.
First, the revised NSPS will restrict the use of clean fuel as a com-
pliance method for boilers coming on stream as early as 1985.  This
factor alone could double the potential candidates for FGD byproduct
marketing.  Less than half of the boilers scheduled for 1980 through
1984 are committed to FGD—the majority have selected clean fuel.

     In addition to the more stringent SOX removal standards, the revised
NSPS call for a much more rigorous fly ash emission standard.  The 1985
results show that the most attractive compliance strategy may be one
that combines both SOX and final fly ash removal in one step as is
common in dry scrubbing.  The advantage of simultaneous removal is seen
primarily in new boilers (1985) wherein the capital investment for an
electrostatic precipitator (ESP) solely for the high-efficiency fly ash
removal requirements can be avoided.

     Another significant factor observed in the preparation of the 1985
projection is the increased use of sludge fixation and landfill rather
than direct sludge ponding.  Although the 1985 projection shows very
little potential for byproduct marketing when sludge ponding is feasible,
the marketing opportunities are increased when sludge fixation and
landfill are required for the limestone process.

     Finally, escalation of capital and operating costs (particularly
No. 6 fuel oil) and the addition of chloride removal provisions (i.e., a
prescrubber) in the magnesia process virtually-eliminated the production
and marketing of sulfuric acid under conditions projected for 1985.
Only when the chloride removal requirements were eliminated from the
magnesia scrubbing process did production and marketing of byproduct
sulfuric acid reemerge as a feasible power plant alternative.

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  POTENTIAL 1985  SUPPLY AND DEMAND

  Power  Plants

      For  1985,  124 boilers at 83 power plant sites are projected to be
  potential FGD byproduct marketing candidates.  Of these 124 boilers, 74
  were scheduled  to be on stream by the end of 1979 and 50 are scheduled
  for 1980  through 1985.  The number of boilers projected to be marketing
  candidates in 1985 is much smaller than in previous model runs for 1978
  and 1983.  Not  only have more existing boilers selected a complying
  strategy  that precludes byproduct marketing, the compliance strategy for
  new boilers is  being selected and implemented concurrently with boiler
  construction, thereby precluding the possibility of byproduct marketing
  much earlier than in the past.  As an example of strategy selection for
  new boilers, 170 boilers are scheduled for startup in 1980-1985.   Of
  these  170, 69 have selected a complying fuel, 21 have selected scrubbing,
  50 have not committed to a specific strategy to the extent that byproduct
 marketing is necessarily precluded,  6 are less than the minimum size
 considered feasible for byproduct marketing (less than 100 MW), and
  there were not enough data available on 24 boilers to project byproduct
 marketing economics.   Of the 50 new boilers that are potential byproduct
 marketing candidates,  2 are  scheduled for 1980, 2 for 1981,  9 for 1982,
 6 for 1983, 10 for 1984, and 21  for  1985.   The increased number of  new
 boilers in 1985  projected to be  potential marketing candidates  results
 from the assumption that they must meet the revised NSPS and cannot use
 a complying fuel alone (i.e.,  they must use FGD).

      Based on the compliance analysis results,  S02 emissions at the 83
 plant  sites will have  to be  reduced  by a  maximum of  about  5,000,000 tons
 to meet regulatory  levels.   This  represents a maximum power  plant FGD
 production potential of  about  2,500,000 tons of sulfur or  about 7,600,000
 tons of sulfuric acid.

 Sulfuric Acid Plants

     In 1985,  87 sulfur-burning acid  plants  are projected  to be in
 operation.  These plants are projected  to  require  about  10,000,000  tons
 of sulfur  and  produce  about  30,500,000  tons  of  sulfuric acid.   They
 represent  the maximum  1985 demand projected  for FGD byproduct sulfur and
 sulfuric acid.   Of these plants, 75 are in  the  37  Eastern  States.   They
 represent  about  93% of the demand and are projected to  require  9,400,000
 tons of sulfur to produce 28,500,000  tons of acid.  The remaining 12
 plants  are in the 11 Western States.  They  represent about 7% of  the
 demand  and are projected to require 600,000  tons of sulfur to produce
 about 2,000,000  tons of acid.  Appendix B contains details on sulfur
 sources  and costs and sulfuric acid avoidable production costs.

     Sulfuric acid plants using smelter off-gas are acid producers of
necessity  and represent market competition for power plant acid.
Although the current market is assumed to be generally balanced between
supply and demand any production increases by smelters could reduce the
potential market  for FGD sulfur and sulfuric acid.  This possibility was

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provided for with a projected 10% increase by 1985 in smelter sulfuric
acid production as follows:  Eastern U.S. smelters, 275,000 tons; Canadian
smelters, 200,000 tons; and Western U.S. smelters, 450,000 tons.  These
projected quantities represent not only direct competition for FGD
sulfuric acid, but also indirect competition for the equivalent FGD
sulfur because sulfur is not required for the smelter acid production.

Model Runs for the 1985 Projection

     Model changes for 1985 resulted in a much more complex analysis
than those of the previous projections.  The changes were the addition
of limestone scrubbing with waste fixation and landfill as an additional
compliance alternative, inclusion of the revised NSPS that were assumed
to eliminate the use of a complying fuel for new plants, the provision
for chloride removal in the magnesia process, the inclusion of power
plant FGD sulfur producers in the model for the first time, and the
inclusion of Canadian recovered sulfur as direct competition with Port
Sulphur Frasch sulfur and power plant FGD sulfur.  Three different cost
premiums for complying fuels (alternative clean fuel level—ACFL) were
used, but this option does not apply to plants required to meet the
revised NSPS; their only alternative is one of the FGD options.  Of the
83 plants considered as potential marketing candidates in 1985, 20 are
projected to come under the revised NSPS and therefore were assumed to
require an FGD option.   The remaining 63 plants are projected to have the
option of a complying fuel and therefore the ACFL would affect the
compliance strategy selection at these plants.

     The ACFL's used for 1985 were $0.70, $1.00, and $1.25/MBtu.  The
various scrubbing alternatives that were compared at each of these
levels are:

   •  Sulfur production versus limestone scrubbing with sludge ponding

   •  Sulfur production versus limestone scrubbing with sludge fixation
      and landfill

   •  Sulfuric acid production with chloride removal versus limestone
      scrubbing with sludge ponding

   •  Sulfuric acid production with chloride removal versus limestone
      scrubbing with sludge fixation and landfill

   e  Sulfuric acid production without chloride removal versus limestone
      scrubbing with sludge ponding

   o  Sulfuric acid production without chloride removal versus limestone
      scrubbing with sludge fixation and landfill

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 FGD BYPRODUCT SULFUR

      Previous projections for 1978 and 1983 FGD sulfur production were
 based on the Wellman-Lord/Allied Chemical natural-gas reduction process,
 The ACP is used in the 1985 projection for byproduct sulfur production
 (see Appendix B).  The ACP as used for this projection is illustrative
 of two important FGD process advantages.   First, coal is used as the
 energy source instead of oil or natural gas, and second, both SOX and
 final fly ash removal are combined.  Combining the removal of SOX and
 final fly ash eliminates the costs of a separate ESP solely for fly ash
 removal in new installations.  In this study 85%-efficient cyclones are
 used for initial fly ash removal.

      Two constraints were placed on the selection of potential power
 plant sulfur marketing candidates.   The first constraint was a minimum
 production capacity of 5000 tons of sulfur per year.  The second con-
 straint was that no plant with an incremental sulfur production cost
 greater than $100 was considered.  These  values are considered to repre-
 sent the limits  of economically feasible  marketing potential,  and they
 allow the costs  of using the computerized model to be significantly
 reduced.

 Sulfur Production Versus Limestone  Scrubbing with Sludge Ponding

 Candidates  at the $0.70,  $1.00,  and $1.25 ACFL—
      The model results,  in terms of the number of power  plants using a
 compliance  strategy based on a comparison of sulfur production and
 limestone scrubbing with sludge  ponding at each of  the three ACFL's,  in
 $/MBtu premium for complying fuel,  are:
                                 	Number of plants	
      Compliance  strategy	$0.70 ACFL   $1.00 ACFL   $1.25 ACFL
 Complying  fuel                       26            2            2
 Limestone  scrubbing with sludge
  ponding                             53           77           77
 Possible sulfur production            444

     Only  four plants projected to select a scrubbing strategy at the
 $0.70 ACFL have a projected sulfur production capacity of at least 5000
 tons/year  and an incremental cost of less than $100/ton.  All four of
 these plants would have selected a complying fuel at the $0.70 ACFL, but
 they are projected to have to comply with revised NSPS and therefore do
 not have the option of using a complying fuel alone.  Even though the
 number of  plants projected to select an FGD strategy increases signifi-
 cantly at  the higher ACFL's, there are no additional sulfur production
 candidates.  The four marketing candidates have a combined sulfur pro-
duction potential of about 63,000 tons/year.

Projected market potential—
     The model results indicate potential markets for the total production
of the four marketing candidates.   The projected distribution for these


                                     8

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plants is shown in Table 1.  The final results from the comparison of
sulfur production with sludge ponding at each of the ACFL's are:

                                           Number of plants
Compliance strategy
Complying fuel
Limestone scrubbing with sludge
ponding
Sulfur production
$0.70 ACFL
26

53
4
$1.00 ACFL
2

77
4
$1.25 ACFL
2

77
4
               TABLE 1.  SULFUR PRODUCTION VERSUS LIMESTONE

                       SCRUBBING WITH SLUDGE PONDING

          ($0.70, $1.00, and $1.25 ACFL, in $/MBtu premium for
         complying fuel; all plants shown are scheduled for 1985)

Power plant location
Washington County, FL
Westmoreland County, PA
Montgomery County, MD
Rusk County, TX
Tons
of sulfur
20,000
24,000
10,000
9,000
63,000
Consumer location
Do than, AL
White Springs, FL
North Bend, OH
Copley, OH
Baltimore, MD
Fort Worth, TX
Tons
of sulfur
7,000
13,000
8,000
16,000
10,000
9,000
63,000

Sulfur Production Versus Limestone Scrubbing with Sludge Fixation
and Landfill

Candidates at the $0.70, $1.00, and $1.25 ACFL—
     The comparison of sulfur production and limestone scrubbing with
sludge fixation and landfill instead of sludge ponding shows distinctly
improved prospects for marketing.  The results at each of the three
ACFL's, in $/MBtu premium for complying fuel, are:
      Compliance strategy
                                            Number of plants
$0.70 ACFL  $1.00 ACFL  $1.25 ACFL
Complying fuel
Limestone scrubbing with sludge
 fixation and landfill
Possible sulfur production
    51

    20
    12
62
12
69
12

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      Twelve plants projected to select an FGD strategy at the $0.70 ACFL
 have a projected sulfur production capacity of at least 5000 tons/year
 and an incremental cost of less than $100/ton.   All of the plants that
 were candidates based on the comparison with sludge ponding described
 earlier are also candidates when compared with sludge fixation and
 landfill.  Four of the 12 plants have projected scrubbing costs less
 than the $0.70 ACFL and 8 plants are projected to have to comply with
 revised NSPS and have no complying fuel option under the assumptions
 of this study.   As in the comparison with sludge ponding, the number of
 plants selecting an FGD strategy increases significantly at the $1.00
 and $1.25 ACFL but there are no additional candidates for sulfur pro-
 duction.   The 12 marketing candidates have a combined sulfur production
 potential of about 215,000 tons/year.

 Projected market potential—
      The  model results show potential markets for 11 of the 12 candidates.
 The single excluded plant was considered because FGD was the only option,
 but the incremental cost plus shipping cost  to  potential consumers  is
 projected to exceed the consumers cost from  other suppliers.   The
 projected market distribution for the 11 plants  is shown in Table 2.
 All of the plants with marketing potential based on the comparison with
 sludge ponding  described earlier also have marketing potential based on
 the comparison  with sludge fixation  and landfill,  and the projected
 distribution for these four plants is  unaffected by the competition  from
 the seven additional plants.   The final results  from the comparison  of
 sulfur production and limestone  scrubbing with sludge fixation and
 landfill  at each of the ACFL's,  in $/MBtu premium for complying fuel,
 are:

                                           Number of plants
	Compliance strategy	$0.70 ACFL  $1.00 ACFL  $1.25 ACFt

Complying fuel                       51           9           2
Limestone scrubbing with sludge
  fixation and landfill               21          63          70
Sulfur production                    11          n          n
FGD BYPRODUCT SULFURIC ACID

     Two variations of the magnesia process were used for FGD sulfuric
acid production in the 1985 projection.  Separate process variations
were used because of questions related to chloride control requirements
for various coal characteristics and operating conditions (see Appendix B).

     As in the case of the sulfur models, two constraints were placed on
the selection of potential power plant sulfuric acid marketing candidates.
The first constraint was a minimum production capacity of 40,000 tons of
sulfuric acid per year.   The second constraint was that no plant was
considered if the incremental sulfuric acid production cost exceeded
$40/ton.  These values were selected because FGD acid production installa-
                                    10

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       TABLE 2.  SULFUR PRODUCTION VERSUS LIMESTONE

        SCRUBBING WITH SLUDGE FIXATION AND LANDFILL

               ($0.70, $1.00, and $1.25 ACFL)

Power plant location
Staten Island County, NY
Martin County, FLa
Washington County, FLa

Sherburne County, MN
Westmoreland County, PAa

Montgomery County, MDa
Shelby County, AL
Williamson County, ILa>d

Rusk County, TXa
Henderson County, TX
Armstrong County, PAa'e
Tons
of sulfur
7,000
28,000
20,000

8,000
24,000

10,000
12,000
11,000

9,000
7,000
29,000
Consumer location
Newark , NJ
Pierce, FL
Do than, AL
White Springs, FL
Indianapolis , IN
North Bend, OHC
Copley, OHC
Baltimore, MD
Tuscaloosa, AL
East St. Louis, IL
Indianapolis, INb
Fort Worth, TX
Fort Worth, TX
Cleveland, OHC
Tons
of sulfur
7,000
28,000
7,000
13,000
8,000
8,000
16,000
10,000
12,000
5,000
6,000
9,000
7,000
29,000
                       165,000
165,000
Scrubbing costs were greater than $0.70 ACFL, but 1985 boilers
cannot comply by using clean fuel alone.
Also a potential purchaser of power plant acid, which is pro-
jected to result in greater savings.
Also a potential purchaser of power plant acid, but purchasing
sulfur is projected to result in greater savings.
Scrubbing costs were greater than $1.00 ACFL, but 1985 boilers
cannot comply by using clean fuel alone.
Also a potential producer and marketer of acid, but sulfur pro-
duction is projected to result in greater revenues.
                          11

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  tions of less than 40,000 tons/year are not  projected to  be  economically
  feasible and there are no markets projected  for sulfuric  acid  at  prices
  above $40/ton regardless of location.

  Effects of No.  6 Fuel Oil Price Escalation

       Of particular significance to the  magnesia process are  the effects
  of fuel oil price escalation.   Table 3  illustrates  the effects of various
  annual percentage price escalation rates for No.  6  fuel oil  and the
  equivalent unit price increases in No.  6 fuel  oil,  natural gas, and
  coal.   Based on a late 1979 wholesale price  of $0.60/gallon  for No. 6
  fuel oil,  even  a 5% per year escalation amounts to  an increase of over
  $0.20/gallon by late 1985.   The energy-equivalent increase for natural
  gas  is $1.37/kft3 and for coal  is  over  $30.00/ton.  At a  15% per  year
  No.  6  fuel oil  price escalation rate (the  approximate rate projected
  through 1985),  the price of coal would  have  to increase by over $116/ton
  (over  three times the current price) to equal  the No. 6 fuel oil  price
  escalation on an energy-equivalent  basis.
          TABLE 3.  NO. 6 FUEL OIL ESCALATION COMPARED WITH ENERGY

                EQUIVALENT INCREASES IN NATURAL GAS AND COAL


   No. 6 fuel oil   	Equivalent price increase, 1979-1985	
    annual price    No. 6 fuel oil,      Natural gas,          Coal,
     escalation          $/gal              $/kft3             $/ton
      rate. %	(149.000 Btu/gal)   (1.000 Btu/ft3')   (11.000 Btu/lb)
5
10
15
20
25
0.20
0.46
0.79
1.19
1.69
1.37
3.11
5.29
8.00
11.33
30.13
68.35
116.32
175.94
249.36
     The magnesia FGD byproduct sulfuric acid process, which uses No. 6
 fuel oil for drying and calcining the magnesium sulfite, is particularly
 sensitive to the projected escalation.  An increase of $0.01/gallon
 increases the FGD sulfuric acid production cost by $0.55/ton.  This
 relationship in terms of percentage annual price escalation from late
 1979 through 1985 is shown in Figure 1.  At the projected 15% annual
price escalation, the No. 6 fuel oil price increase equals a sulfuric
acid production cost increase of over $43/ton.  The net effect on
incremental sulfuric acid costs is reduced somewhat by escalation of
costs for limestone scrubbing with fixation and landfill, but their
projected escalation rate is not nearly as high as that for No. 6 fuel
oil.  Obviously, the economics of this process would be improved sub-
stantially by substitution of coal for the fuel oil.

                                    12

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Figure  3.   Reduction  in potential  FGD  sulfuric acid

            margin with  No.  6 fuel  oil  annual price

            escalation.
                               14

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 margin for sales of FGD sulfuric acid.   Their additive  effect  on  potential
 FGD sulfuric acid sales margin is shown in Figure 3.  At  the projected
 15% escalation rate for No.  6 fuel oil, the combined  effect of increased
 FGD production costs and decreased existing acid producer avoidable
 production costs results in  a reduction of the potential  FGD sulfuric
 acid sales margin of about $54/ton.

 Chloride Removal Required

      There are no potential  candidates  for sulfuric acid  marketing based
 on the magnesia process variation with  provisions for chloride scrubbing.
 The provision for chloride scrubbing increases acid production costs to
 the point that, in comparison with limestone scrubbing  with sludge
 ponding, there are no plants with a projected incremental production
 cost of less than $90/ton.   In comparison  with limestone  scrubbing with
 sludge fixation and landfill there is some improvement, but even  then
 there are no plants with a projected incremental cost of  less  than
 $60/ton.

 Chloride Removal Not Required

      When provisions for chloride removal  are not  included in  the
 magnesia process (as in previous  projections  for 1978 and 1983), potential
 candidates for sulfuric acid marketing  reappear  as in the earlier projec-
 tions.   However,  as in the case of sulfur  production, the projected
 potential for marketing in comparison with limestone  scrubbing with
 sludge  ponding is much less  than  when the  comparison  is made with lime-
 stone scrubbing with sludge  fixation and landfill.

 Sulfuric Acid Production Versus Limestone  Scrubbing with  Sludge Ponding

 Candidates at $0.70,  $1.00,  and $1.25 ACFL—
      The model results  from  the comparison of  sulfuric  acid production
 with limestone scrubbing with sludge  ponding  at  each  of the ACFL's, in
 $/MBtu  premium for  complying  fuel, are:

                                  	Number of  plants	
      Compliance  strategy	$0.70 ACFL   $1.00  ACFL   $1.25 ACFL

 Complying  fuel                        26            2            2
 Limestone  scrubbing with  sludge
 ponding                              53           77           77
 Possible acid  production               444


     Only  four plants projected to select  an FGD strategy at the $0.70
ACFL have  a projected sulfuric acid production capacity of at  least
 40,000  tons/year and an. incremental cost of less than $40/ton.   Two of
 these plants would select a complying fuel  at the $0.70 ACFL,  but they
are projected  to have to  comply with revised NSPS and, therefore,   do
not have the option of a  complying fuel alone.  As in the other compari-
sons, the number of plants projected to select an FGD strategy increases


                                    15

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 at the higher ACFL values, but there are no additional acid production
 candidates.  The four marketing candidates have a combined sulfuric acid
 production potential of about 300,000 tons/year.

 Projected market potential—
      The model results show potential markets for only two of the four
 candidates.  Both of the excluded plants were considered because FGD was
 their only option, but delivered costs to potential customers are
 projected to be greater than the customers' own avoidable production
 cost.  The projected market distribution is shown in Table 4.  The final
 results from the comparison of sulfuric acid production and limestone
 scrubbing with sludge ponding at each of the ACFL's, in $/MBtu premium
 for complying fuel, are:
      Compliance strategy
                                            Number of plants
$0.70 ACFL   $1.00 ACFL   $1.25 ACFL
 Complying fuel                        26
 Limestone scrubbing with sludge
  ponding                              55
 Acid production                        2
                 79
                  2
79
 2
         TABLE 4.  ACID PRODUCTION (NO CHLORIDE SCRUBBING) VERSUS

                  LIMESTONE SCRUBBING WITH SLUDGE PONDING

                      ($0.70, $1.00,  and $1.25 ACFL)


  Power plant location   Tons of acid   Consumer location   Tons of acid
Person County, NC 103,000


Titus County, TX 43,000
146,000
Richmond, VA
Wilmington, NC
Norfolk, VA
Shreveport, LA

36,000
26,000
41,000
43,000
146,000
Acid Production Versus Limestone Scrubbing with Sludge Fixation
and Landfill

Candidates at the $0.70, $1.00, and $1.25 ACFL—
     The model results from the comparison of sulfuric acid production
and limestone scrubbing with sludge fixation and landfill at each of the
ACFL's, in $/MBtu premium for complying fuel, are:
                                    16

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                                            Number of  plants
     Compliance strategy	$0.70 ACFL   $1.00  ACFL    $1.25 ACFL

Complying fuel                         48           9           2
Limestone scrubbing with sludge
 fixation and landfill                 22           46           53
Possible sulfuric acid production      13           28           28

     Thirteen plants projected to select a possible sulfuric acid pro-
duction strategy at the $0.70 ACFL have a projected production capacity
of at least 40,000 tons/year and an incremental cost of less than $40/ton.
These 13 plants include all of the plants that are marketing candidates
in the comparison with limestone scrubbing with sludge ponding.  Seven
of the 13 plants have projected scrubbing costs less than the $0.70  ACFL
and 6 plants are projected to have to comply with the  revised NSPS and,
therefore, have no option for a complying fuel alone.   Unlike the com-
parisons described previously, in this case there is a significant
increase in the number of potential marketing candidates at the $1.00
and $1.25 ACFL.  There is no change between the $1.00  and $1.25 ACFL,
but at these levels there are 15 additional candidates (over the $0.70
ACFL) for a total of 28.  Because all candidates required to comply  with
the revised NSPS were selected at the $0.70 ACFL, the additional candidates
are projected to select an FGD strategy only at the higher ACFL's.   The
candidates at the $0.70 ACFL have a combined sulfuric acid production
potential of about 2,000,000 tons/year, and at the $1.00 and $1.25 ACFL
the projected production potential increases to almost 4,000,000 tons/year
of sulfuric acid.

Projected market potential—
     The model results show potential markets  for 4 of the  13  candidates
at the $0.70 ACFL and for 8 of the 28 candidates at the  $1.00  and $1.25
ACFL.  The projected market distribution  is shown in  Tables  5  and 6.
The two plants with marketing potential based  on the  comparison with
limestone scrubbing with sludge  ponding also have marketing  potential in
comparison with  limestone scrubbing with  sludge fixation and landfill.
The projected  distribution  for these  two  plants is not affected by  the
competition  from the additional  plants.   The  final  results  from  the
comparison of  sulfuric  acid production with  sludge  fixation and  landfill
at each of the ACFL's,  in $/MBtu premium for  complying fuel, are:

                                             Number  of plants
       Compliance strategy	$0.70 ACFL   $1.00  ACFL   $1.25  ACFL

 Complying fuel                         48            92
 Sludge stabilization and landfill      31           66           73
 Acid production                         488
                                     17

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        TABLE 6.  ACID PRODUCTION (NO CHLORIDE SCRUBBING) VERSUS

          LIMESTONE SCRUBBING WITH SLUDGE FIXATION AND LANDFILL

                         ($1.00 and $1.25 ACFL)

Power plant location
Person County, NC
Jasper County, IL
Pike County, IN
Jefferson County, OH
Northhampton County, PA
Delaware County, PA
Titus County, TX
Armstrong County, PA°
Tons of acid
103,000
122,000
51,000
228,000
182,000
53,000
43,000
86,000
868,000
Consumer location
Richmond, VA
Wilmington, NC
Norfolk, VA
Tuscola, IL
Indianapolis, INa
North Bend, OHb
Cleveland, OHb
Copley, OHb
Deepwater, NJ
Edison, NJ
Gibbstown, NJ
Gibbstown, NJ
Shreveport , LA
Cleveland, OH
Tons of acid
36,000
26,000
41,000
122,000
51,000
90,000
91,000
47,000
95,000
74,000
13,000
53,000
43,000
86,000
868,000
a.  Also a potential purchaser of power plant sulfur, but purchasing acid
    is projected to result in greater savings.
b.  Also a potential purchaser of power plant sulfur, which is projected
    to result in greater savings.
c.  Also a potential producer and marketer of sulfur, which is projected
    to result in greater revenues.
                                  18

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         TABLE 5.  ACID PRODUCTION (NO CHLORIDE SCRUBBING) VERSUS

           LIMESTONE SCRUBBING WITH SLUDGE FIXATION AND LANDFILL

                               ($0.70 ACFL)
  Power plant location
                      Tons of acid   Consumer location   Tons of acid
Person County, NC
Northhampton County, PA
Titus County, TX
Armstrong County, PAa>
103,000
182,000
43,000
86,000
414,000
Richmond, VA
Wilmington, NC
Norfolk, VA
Deepwater, NJ
Edison, NJ
Gibbstown, NJ
Shreveport, LA
Cleveland, OHC
36,000
26,000
41,000
90,000
26,000
66,000
43,000
86,000
414,000

 a.

 b.

 c.
Scrubbing costs were greater than $0.70 ACFL, but 1985 boilers
cannot comply by using clean fuel alone.
Also a potential producer and marketer of sulfur, which is projected
to result in greater revenues.
Also a potential purchaser of power plant sulfur, which is projected
to result in greater savings.
INTEGRATED ANALYSIS

     The computerized model results just described were developed inde-
pendently for each ACFL and scrubbing process (waste disposal versus
marketable byproducts).  Although the higher ACFL values carry the
implication of increased market competition from other power plants,
this is not directly addressed by the model and the competitive marketing
aspects of FGD sulfur in comparison with FGD sulfuric acid are not
addressed at all.  An integrated analysis is therefore required to
develop a collective projection of byproduct marketing potential for
1985.  The collective projection based on combined results requires
several additional considerations because the purpose of this projection
is to identify as many plants as possible where the production of market-
able FGD byproducts might be economically feasible.

     All of the power plants that are potential sulfur or sulfuric acid
marketing candidates in comparison with limestone scrubbing with sludge
ponding are also potential candidates in comparison with limestone
scrubbing with sludge fixation and landfill.  Therefore, limiting the
final projection to the latter comparison does not exclude any potential
candidates.  Likewise, limiting the final projection to the highest ACFL
does not exclude any potential candidates.  A power plant is not a

                                    19

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 reasonable marketing candidate if the potential  market would be  easily
 lost because other plants that are more competitive  at a higher  ACFL
 also select a marketing strategy.  The final  step  in developing  the
 combined marketing projection is a comparison of the potential for
 marketing FGD sulfur with the potential for marketing FGD sulfuric acid.

 Combined Sulfur and Sulfuric  Acid Results

      The sulfur and sulfuric  acid results  presented  earlier contain
 several conflicts between sulfur marketing and sulfuric acid marketing.
 These conflicts must be resolved to prepare a combined projection,
 otherwise,  a single power plant  might be projected to market both sulfur
 and sulfuric acid and a single acid plant  might  be projected in  one case
 to purchase FGD sulfur and continue production and at the same time in
 another case to shut down and purchase FGD sulfuric  acid.

      The first  conflict involves a power plant that  is projected to be a
 potential marketer of both sulfur and sulfuric acid.  The problem is
 somewhat simplified because the  same  acid  plant  is projected to be the
 consumer of either FGD sulfur or FGD  sulfuric  acid from this power
 plant.   Based on the power plant's  incremental production costs and the
 acid plant's delivered sulfur and avoidable production costs (including
 sulfur  costs from other sources)  FGD  sulfur is projected to result in
 greater potential combined power plant  and acid plant benefits.  The
 selection of sulfur instead of sulfuric acid  for this power plant reduces
 the potential 1985  FGD sulfuric  acid  production by about 85,000 tons/year.

      The remaining  marketing  conflicts  involve acid plants that are pro-
 jected  to be potential purchasers  of  both FGD  sulfur  and FGD sulfuric
 acid.   These conflicts  are more  difficult  to resolve  than the previous
 case because the  potential power plant  sulfur  suppliers are not the same
 as  the  potential  power plant  sulfuric  acid suppliers.  No matter which
 byproduct is selected  for  a given power plant  and acid plant combination,
 the result  is the effective elimination of that market for the other
 byproduct.   Although in  the case of sulfur the power plant production
 can equal any percentage of the  acid plant requirements,  this is not
 true for sulfuric acid.  Model results  indicate that even when the
 purchase of  FGD acid alone  is considered, acid plants cannot economically
 reduce  production by arbitrary percentages.  These percentages are
 limited by  design (turndown ratio), the number of trains,  and steam-
 generation  requirements.   Because of this, circumstances  would have to
 be  very unusual for  a  sulfuric acid plant to purchase significant amounts
 of  both FGD  sulfur and FGD  sulfuric acid.

     Four acid plants  are projected to be potential purchasers of both
 FGD sulfur and FGD sulfuric acid.  Based on power plant incremental
 production costs  and acid plant delivered sulfur and avoidable produc-
 tion costs  (including sulfur costs from other sources),  the purchase of
FGD  sulfuric acid is projected to result in a greater potential benefit
 for one of the acid plants and the corresponding power plant supplier;
FGD sulfur is projected to be a better choice in the other cases.  The
purchase of FGD sulfuric acid in the first case would eliminate the

                                    20

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market for about  8000 tons/year of sulfur from another power plant.
The purchase of sulfur in the remaining three cases would eliminate the
market for about 228,000 tons/year of sulfuric acid from another power
plant.

     Additional model runs were required to determine if the two power
plants projected to lose their potential market for one byproduct to the
power plant producers of the other byproduct could find another market.
The results indicate that the FGD sulfur producer would have no problem
finding alternative markets that would be only slightly less profitable,
but this is not expected to be the case for the potential FGD sulfuric
acid producer because no alternative markets are indicated.

     The combined projection for competitive FGD sulfur and  sulfuric
acid market distribution is shown in Table 7.  The FGD sulfur marketing
potential is projected to be about 165,000 tons/year from 11 plants and
the FGD sulfuric acid marketing potential is projected to be just over
500,000 tons/year from 6 plants.  The use of FGD sulfur instead of
sulfur from current sources could result in a combined benefit for the
utility and sulfuric acid industry of as much as $10,000,000 in 1985.
Potential benefits from the use of FGD sulfuric acid are projected to  be
just slightly higher at $10,500,000 in 1985.

Strategy Selection Summary

     The combined compliance strategy and potential byproduct marketing
projection for 1985 is:

            	Compliance strategy	Number of plants

            Complying fuel                            2
            Limestone scrubbing                      64
            Projected sulfur marketer                11
            Projected sulfuric acid marketer         __6

                 Total                               83


As shown, 17 power plants out of the 83 considered are projected to be
potential candidates for byproduct marketing in 1985.  Of the 17, 11 are
projected to be potential sulfur marketers with an estimated production
of up to 165,000 tons/year.   The remaining six plants are projected to
be potential sulfuric acid marketers with an estimated production of up
to 554,000 tons/year.  The combined benefits to the utility  and sulfuric
acid industries are projected to be as much as $20,000,000 in.1985.
                                    21

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          TABLE 7.  COMPETITIVE PRODUCTION AND DISTRIBUTION

                 FGD SULFUR VERSUS FGD SULFURIC ACID
Power plant location
Sulfur
Staten Island County, NY
Martin County, FL
Washington County, FL
Sherburne County, MN
Westmoreland County, PA
Montgomery County, MD
Shelby County, AL
Williamson County, IL
Rusk County, TX
Henderson County, TX
Armstrong County, PA
Sulfuric Acid
Person County, NC
Jasper County, IL
Pike County, IN
Northhampton County, PA
Delaware County, PA
Titus County, TX
Tons
7,000
28,000
20,000
8,000
24,000
10,000
12,000
11,000
9,000
7,000
29,000
165,000a
103,000
122,000
51,000
182,000
53,000
43,000
554,000b
Consumer location
Newark, NJ
Pierce, FL
Do than, AL
White Springs, FL
Dubuque , IA
North Bend, OH
Copley, OH
Baltimore, MD
Tuscaloosa, AL
East St. Louis, IL
Fort Worth, TX
Fort Worth, TX
Cleveland, OH
Richmond, VA
Wilmington, NC
Norfolk, VA
Tuscola, IL
Indianapolis, IN
Deepwater, NJ
Edison, NJ
Gibbstown, NJ
Gibbstown, NJ
Shreveport, LA
Tons
7,000
28,000
7,000
13,000
8,000
8,000
16,000
10,000
12,000
11,000
9,000
7,000
29,000
165,000a
36,000
26,000
41,000
122,000
51,000
95,000
74,000
13,000
53,000
43,000
554,000b
The potential revenue/savings to both industries combined is projected to
be as much as $10,000,000 for an approximate average of $60/short ton of
sulfur.
The potential revenue/savings to both industries combined is projected to
be as much as $10,500,000 for an approximate average of $19/short ton of
sulfuric acid.

                                22

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DISCUSSION OF RESULTS

FGD Byproduct Sulfur

Effects of New Plants and Revised NSPS—
     In the competitive production and distribution solution for FGD
sulfur versus FGD sulfuric acid (Table 7), 11 plants are shown producing
and marketing 165,000 tons of sulfur.  Seven of these plants with
131,000 tons (or four-fifths of the market) are scheduled for initial
operation in 1985 (by definition these plants are assumed to be subject
to the revised NSPS).  Furthermore, these 7 sulfur-marketing power
plants come from 21 potential candidates in 1985, whereas the remaining
4 plants shown to be potential marketers of sulfur are from a field of
29 candidates in the 1980-1984 startup period.  The increase in poten-
tial marketing plants from less than 14% of the candidates in 1980-1984
to over 33% in 1985 results from (1) the advantage of a dry-scrubbing
system with final fly ash removal built into the S02 removal system in a
new plant and (2) the higher cost of a separate ESP for fly ash removal
under the revised NSPS.

     The sharp increase in the number of candidates with the 1985 plants
(21 versus 10 in 1984, 6 in 1983, 9 in 1982, and 2 each in 1981 and
1980), as previously stated, results from the assumption that the revised
NSPS restrict the  clean fuel compliance option.

Amount of Sulfur in Coal Burned—
     As discussed in the process descriptions (Appendix A) the pre-1985
plants are assumed to have an existing ESP for separate removal of fly
ash.  This is a much greater advantage for the wet-scrubbing processes
than for the AGP and tends to preclude pre-1985 plants from competitive
sulfur production.  However, four pre-1985 plants are projected to be
potential FGD sulfur producers.  The fuel sulfur content for these
plants is consistently low.  It ranges from 0.92 to 1.04 Ib sulfur/MBtu,
with an unweighted average of 0.97 Ib sulfur/MBtu.  The pre-1985 plants
are potential marketers of sulfur primarily because of the high unit
cost of treating relatively small quantities of sludge by fixation and
landfill.  Even though the sulfur produced has an increased unit cost at
low volumes, the equivalent unit cost for the limestone process with
fixation and landfill has an even greater increase at the lower volumes.
This more than offsets the initial capital advantage of the limestone
process because of the existing ESP.  It is this improved incremental
cost of sulfur at lower coal sulfur levels that makes the four pre-1985
plants competitive.

     On the other hand, the coal sulfur content of the seven 1985 plants
marketing sulfur has a higher and wider range of 1.25 to 3.20 Ib sulfur/
MBtu, and averages 2.09 Ib sulfur/MBtu.  Lower sulfur content in the
fuels of these plants would probably improve their competitive positions.
With the aforementioned advantage accruing to the 1985 plants, however,
higher annual sulfur production levels are more competitive with limestone
slurry processes than are competitive in the pre-1985 plants.
                                    23

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 FGD Sulfuric Acid

 Magnesia Process with Chloride Removal—
      Higher capital and operating costs are approximately equal factors
 in making this process, as currently projected for 1985,  noncompetitive
 with either limestone scrubbing with sludge ponding or limestone scrub-
 bing with fixation and landfill, despite the fact that the magnesia
 process has the lowest raw materials costs of those included in this
 evaluation.

 Magnesia Process Without Chloride Removal—
      It was seen with sulfur byproduct projections that the new (1985)
 plants had a significant advantage over existing (pre-1985)  plants.   The
 opposite is true with FGD sulfuric acid from the magnesia process without
 chloride removal.   Existing plants are assumed to have fly ash  disposal
 facilities already installed.   Therefore,  an existing  plant  adding
 limestone scrubbing with fixation and landfill does not benefit  by
 elimination of construction costs for the  fly ash pond other than an
 allowance for land.   In the new plant comparisons,  however,  fly  ash
 removal and disposal facilities are not yet built.   This  results in a
 full  credit to the limestone scrubbing process for elimination of the
 fly ash transportation and pond construction costs.  This result is seen
 in Table 7,  showing the maximum FGD sulfuric acid sales in competition
 with  FGD sulfur.   All six of the sulfuric  acid marketing  plants  are pre-
 1985.   After 1985  the magnesia  process,  even without chloride removal,
 becomes significantly less competitive in  comparison with the limestone
 scrubbing process  with fixation and landfill.

     Amount  of sulfur in coal burned—The  unit  cost advantage at low
 sulfur  levels  in  the fuel for the ACP is not  present for  sulfuric acid
 production.  The  unit cost increases  at  low volumes for the  magnesia
 process are  not significantly lower than the  corresponding increases  for
 the limestone  process with fixation and  landfill.

 FGD Sulfur Versus  FGD Sulfuric Acid

     In the  final  competitive production and marketing  comparison,
 554,000 tons of FGD  sulfuric acid  (equivalent  to  181,000  tons of sulfur)
 is marketed  and 165,000  tons of FGD sulfur  is marketed.  All  of  the
 sulfuric  acid, however,  depends upon  pre-1985 conditions  (existing
 plants) whereas four-fifths of the  sulfur is  from new  (1985)  plants
 under the  revised NSPS.

     Under 1980 cost  conditions, FGD  sulfuric acid from the magnesia
process without chloride removal has  a lower sulfur-equivalent incre-
mental  cost than FGD sulfur in all  cases except for new plants with low
sulfur  throughput.  The escalation  of  fuel oil No. 6 costs to 1985
levels, however, has significantly deteriorated the competitiveness of
the magnesia process, even without  chloride removal, in comparison with
the ACP using coal for its FGD byproduct fuel.
                                    24

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                               CONCLUSIONS


     Sharply Increasing fuel costs (especially oil and natural gas) are
a critical factor in the FGD sulfur and sulfuric acid processes.  The
projected increase in No. 6 fuel oil cost by the end of 1985 severely
restricts the market potential of sulfuric acid from the magnesia
process, even under the optimistic case with no chloride removal require-
ment.

     Processes that can use coal as the FGD energy source will have
increasing economic advantages over those which use fuel oil or natural
gas.  Even with a highly unlikely equal escalation rate for these three
fuels, the gap per MBtu would widen.   Despite projected increases in
coal transportation costs, its economic advantages over fuel oil and
intrastate natural gas will become even more substantial.  Also, the
future availability of natural gas and fuel oil for FGD application is
uncertain.  The economics of the magnesia process byproduct sulfuric
acid would be greatly improved if coal could be substituted for fuel
oil.

     The necessity for chloride removal in the magnesia process will be
a very important factor in its sulfuric acid production costs.  The
addition of chloride scrubbing and neutralization to the 1985 magnesia
process, coupled with cost escalation (especially fuel oil), eliminated
the FGD sulfuric acid market shown in previous projections.

     In the ACP, simultaneous removal of SOX and the remaining fly ash
(after 85% upstream removal by mechanical collectors) in the same ESP
presents an advantage for new (1985)  plants when compared with alternative
FGD processes which require separate high-efficiency ESP's and scrubbers.

     Lower sulfur throughput favors FGD sulfur marketing since the cost
increase per ton of sulfur removed at low levels is not as great as that
for limestone scrubbing with fixation and landfill or the magnesia
process.

     The number of power plant candidates for FGD byproduct marketing
will increase with the application of the revised NSPS.  It is estimated
that this will affect boilers with startup dates in and after 1985.
Less than half of the boilers projected to come on-line between 1980 and
1984 are committed to FGD systems.  The majority have selected a clean
fuel compliance strategy which will have restricted applicability for
future plants covered by the revised NSPS.
                                    25

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     The potential for FGD sulfur and sulfuric acid marketing is extremely
limited when limestone scrubbing with slurry ponding is a feasible
alternative.  Land limitations, potentially more stringent regulations,
and other  factors may, however, impose severe restrictions on ponding as
it is currently practiced.  An increasing number of limestone slurry
processes  are seen to be selecting landfill disposal methods.  Potential
for production and marketing of FGD byproducts increases when limestone
slurry fixation and landfill are required.  Although direct capital
costs are  usually lower for fixation and landfill, higher operating
costs (principally labor) increase the overall process costs and thus
reduce the incremental FGD byproduct costs.

     The potential for producing and marketing FGD sulfuric acid from
the magnesia process versus limestone scrubbing with fixation and land-
fill is greater for existing than new plants.  For plants not yet built
the full advantage of not building fly ash transportation and ponding
facilities, which are not necessary with fixation and landfill, is
realized whereas these facilities are presumed to be installed in
existing plants.

     Transportation costs, especially by rail, are becoming more important.
Escalation of these costs will affect the marketing range of byproduct
sulfur and, especially, byproduct sulfuric acid.   In addition, substantial
rail rate increases will affect the marketing range of competitive volun-
tary and nonvoluntary sulfur and sulfuric acid products recovered from
sources such as Canadian and U.S.  sour gas, refineries, and smelters.

     Other nonvoluntary sulfur production is becoming a more important
factor in the marketing economics of FGD byproduct sulfur.  Voluntary
production of Frasch sulfur once was the dominant source of U.S. sulfur.
Nonvoluntary sources will constitute 65% of the U.S. sulfur capacity and
almost 78% of North American capacity by 1981.  How this will affect the
price stability of the sulfur market is difficult to project at this
time.  Much will depend on market growth, especially from potential new
uses such as sulfur substitution for asphalt in road-paving applications.
                                    26

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                              RECOMMENDATIONS
     An FGD sulfur and sulfuric production and marketing forecast  should
be projected for 1990 or beyond.  This projection to 1985 reflects only
the beginning of the effects of the 1979 revised NSPS.   In addition,  the
increased lead time required to analyze FGD options and implement
decisions necessitates a more extended time frame.

     Technology and economic developments in spray dryer FGD recovery
processes should be followed closely.

     Developments allowing the use of coal for FGD recovery processes
now using fuel oil or natural gas should be followed closely and incor-
porated into future studies.

     Future studies should include projections of fertilizer demand by
geographical areas to expand the demand system beyond its current limita-
tions of existing and announced sulfuric acid plants and to evaluate the
economics of fertilizer production from FGD sulfuric acid near the point
of use.

     A specific byproduct marketing study should be made for the approxi-
mately 100 power units designated by the Department of Energy for con-
version from oil to coal.  Many of these plants are in high-population
areas where disposal of wastes if FGD were required would be difficult.
These are also areas of historically high sulfur costs.

     Projected demand for sulfur for new uses such as partial or  full
replacement of asphalt in paving should be included.

     The increased supply of refinery recovered sulfur should be  pro-
jected because of the potential increase in use of high-sulfur crude
oil.
                                    27

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                            REFERENCES
Anders, W. L., 1979.  Computerized FGD Byproduct Production and
Marketing System:  Users Manual.  TVA ECDP B-2, Tennessee Valley
Authority, Muscle Shoals, Alabama; EPA-600/7-79-114, U.S. Environ-
mental Protection Agency, Washington, D.C.

Anderson, K. D., J. W. Barrier, W. E. O'Brien, and S. V. Tomlinson,
1980.  Definitive SOX Control Process Evaluations:  Limestone, Lime,
and Magnesia FGD Processes.  TVA ECDP B-7, Tennessee Valley Authority,
Muscle Shoals, Alabama; EPA-600/7-80-001, U.S. Environmental Protection
Agency, Washington, D.C.

Bucy, J. I., J. L. Nevins, P. A. Corrigan, and A. G. Melicks, 1976.
The Potential Abatement Production and Marketing of Byproduct
Elemental Sulfur and Sulfuric Acid in the United States.  Report
S-469, Tennessee Valley Authority, Office of Agricultural and
Chemical Development, Muscle Shoals, Alabama.

Bucy, J. I., R. L. Torstrick, W. L. Anders, J. L. Nevins, and
P. A. Corrigan, 1978.  Potential Abatement Production and Marketing
of Byproduct Sulfuric Acid in the U.S.  Bulletin Y-122, Tennessee
Valley Authority, Muscle Shoals, Alabama; EPA-600/7-78-070, U.S.
Environmental Protection Agency, Washington, D.C.

Corrigan, P. A., 1974.  Preliminary Feasibility Study of Calcium-
Sulfur Sludge Utilization in the Wallboard Industry.  Report S-466,
Tennessee Valley Authority, Office of Agricultural and Chemical
Development, Muscle Shoals, Alabama.

Duvel, W. A., Jr., D. M. Golden, and R. G. Knight, 1979.  Sulfur
Dioxide Scrubber Sludge - What Disposal Options are Still Available?
Preprint, paper presented at the Sludge Management Session, 86th
National AIChE Meeting, Houston, Texas, April 1979.

Federal Register, 1971.  Standards of Performance for New Stationary
Sources.  Federal Register, Vol. 36, No. 247, Part II.

Federal Register, 1979a.  New Stationary Sources Performance Standards;
Electric Utility Steam Generating Units.  Federal Register, Vol. 44,
No. 113, pp. 33580-33624.

Federal Register, 1979b.  Criteria for Classification of Solid Waste
Disposal Facilities and Practices.  Federal Register, Vol. 44, No. 179,
pp. 53437-53468.
                                    28

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Griffith, E. D., and A. W. Clarke, 1979.  World Coal Production.
Scientific American, Vol. 240, No. 1, pp. 38-47.

O'Brien, W. E., and W. L. Anders, 1979.  Potential Production and
Marketing of FGD Byproduct Sulfur and Sulfuric Acid in the U.S.
(1983 Projection).  TVA ECDP B-l, Tennessee Valley Authority,
Muscle Shoals, Alabama; EPA-600/7-79-106, U.S. Environmental Pro-
tection Agency, Washington, D.C.

Santhanam, C. J., R. R. Lunt, and C. B. Cooper, 1979.  Current
Alternatives for Flue Gas Desulfurization (FGD) Waste Disposal -
An Assessment.  In:  Proceedings of the Symposium on Flue Gas
Desulfurization, Las Vegas, Nevada, March 1979.  F. A. Ayer, ed.,
EPA-600/7-79-167a, U.S. Environmental Protection Agency, Washington,
D.C.  pp. 561-594.

Smith, M., M. Melia, and T. Roger, 1979.  EPA Utility FGD Survey:
April-June 1979.  EPA-600/7-79-022e, U.S. Environmental Protection
Agency, Washington, D.C.

Waitzman, D. A., J. L. Nevins, and G. A. Slappey, 1973.  Marketing
H2S04 Abatement Sources - The TVA Hypothesis.  Bulletin Y-71,
Tennessee Valley Authority, Muscle Shoals, Alabama; EPA-650/2-73-051,
U.S. Environmental Protection Agency, Washington, D.C.
                                 29

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                                APPENDIX A

                  BYPRODUCT MARKETING SYSTEM DESCRIPTION
COMPUTER SYSTEM

     The system description presented here is a highly simplified
version of the comprehensive description presented in the users  manual.
For more details, reference to the users manual and the 1983  projection
report is suggested.

     The byproduct marketing system consists of a number of integrated
computer programs, models, and data bases that can be used to make cost
comparisons of FGD strategies designed to meet clean air regulations.
For strategies that produce a salable byproduct, the marketability of
the byproduct is determined and its effect on FGD costs is included in
the cost comparisons.  The system can use this data or user-supplied
data to develop situations for comparison of alternative FGD  strategies.
For comparisons based on the use of clean fuel without FGD, an alterna-
tive clean fuel level (ACFL) is used to represent the cost differential
between a complying fuel and a noncomplying fuel.  In the cases of
sulfuric acid and sulfur production, the system determines the incre-
mental cost of the product.  Incremental production cost is defined as
the production cost per ton of sulfuric acid or sulfur above  the cost  of
either limestone scrubbing or the ACFL value, whichever is lower,  unless
the revised NSPS apply.  The ACFL value is not considered for those
plants that are assumed not to have the option of a complying fuel.

     Figure A-l shows a simplified block diagram of the computer system.
It consists of four subsystems.  The supply (or power plant)  subsystem
includes data bases and programs which provide data on power  plants,
emission control regulations, raw materials costs (including  limestone
delivery cost), and FGD design and cost data.  These are used to
determine the scrubbing costs for the processes being considered on a
boiler-by-boiler basis for each power plant in the data base.  The
demand (or acid plant) subsystem consists of programs and data bases on
sulfur transportation costs and sulfuric acid plant operating costs that
are used to determine acid plant avoidable production costs.   Avoidable
production cost is the expenditure that could be avoided by shutting
down a sulfur-burning acid plant and marketing purchased acid.  This
cost reduction is the break-even price that can-be paid for FGD sulfuric
acid.  For the sulfur demand, the break-even price that can be paid for
FGD sulfur is the delivered price to the acid plant for either Calgary
recovered sulfur or Port Sulphur Frasch sulfur.  The transportation
subsystem consists of data bases and programs to provide rail mileages,

                                    31

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 SUPPLY

 SUBSYSTEM
FOSSL
FRED
POWER
PLANT
DATA
BASE


PROJECT 1 985
INDWDUAL
POWER PLANT
OPERATNG
STATISTICS


9
PROJECT 1 985
REGULATORY
COMPLIANCE
STATUS


	 ¥
CALCULATE 1985
SCRUBBING COSTS
FOR PLANTS
PROJECTED TO
BE OUT OF
COMPLIANCE
DEMAND

SUBSYSTEM
 PROJECT 1985
DELIVERED SULFUR
   COSTS TO
 SULFUR BURMNG
  ACD PLANTS
TRANSPORTATION
SUBSYSTEM
                                                                                         LINEAR PROGRAM MODEL SUBSYSTEM
COMPARE POWER PLANT
INCREMENTAL SULFUR AND
SULFURC ACD PRODUCTION
 COSTS WITH ACD PLANT
DELIVERED SULFUR COSTS
  AND SULFURC ACD
 A VOCABLE PRODUCTION
 COSTS. RESPECTIVELY
 PROJECT 1985
TRANSPORTATION
    RATES
PROJECT POWER PLANTS
 WITH A POTENTIAL
 FOR PRODUCNG AND
    MARKETfCFGO
 BYPRODUCT SULFUR
 OR SULFURC ACD
     IN 1985
Figure A-l.   Computerized  FGD byproduct  production and marketing system.

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tariffs, and rate-basing information for power plants  and acid  plants
from the other subsystems.  It is used to calculate sulfuric acid  and
sulfur transportation costs.  The fourth subsystem consists  of  a linear
programming model and various optional report generators.  It uses the
results of the other three subsystems to select the least-cost  option
for each power plant considered for byproduct marketing.
FGD PROCESS DESCRIPTIONS

     The three processes used in this study are the limestone process,
the magnesia process for sulfuric acid production,  and the Rockwell
International aqueous carbonate process (ACP) for sulfur production.
Two waste disposal variations of the limestone process are used—
untreated ponding and fixation and landfill.  The magnesia process is
also used in two variations, with and without an additional prescrubber
for chloride removal.  The prescrubber is included in the revised
magnesia process because of concern that under some conditions chloride
buildup in the process could lead to reduced MgO utilization, severe
corrosion, and to contamination of the regenerated off-gas with hydro-
chloric acid.  The need of chloride control has not been demonstrated
for all coals and all operating conditions, however.  A variation of the
process without chloride control is therefore included.

     All of the FGD systems are based on a four-parallel-train design
for the 500-MW base case, each with a forced-draft  (FD) booster fan, fed
from a common plenum.  Reheat to 175°F with indirect steam heat is
provided for the wet-scrubbing processes.  The designs are generic,
based on current industry practice and vendor information.

     In order to make equitable comparisons between processes, some
equipment and land credits are made.  Existing (pre-1985) plants are
assumed to have ESP units and fly ash disposal facilities and these
costs are not included.  For limestone scrubbing with fixation and
landfill in existing plants, it is assumed that the existing fly ash
pond is used as the landfill site.  Fly ash transportation and pond
maintenance are applied as credits because the fixation and landfill
process includes fly ash disposal.  (TVA's Solid Wastes Section of the
Water Quality Branch of the Office of Health and Safety has recently
estimated wet ash-handling storage and disposal costs at $13.50/ton.
This estimate was based on a 35-year lifetime and represents the life-
time levelized cost.)  For the existing-plant magnesia process and ACP
that require chloride disposal, an incremental pond cost is included,
assuming that these wastes are discarded in the existing ash pond.  For
new (1985) plants ESP units to meet the 0.03 Ib/MBtu NSPS are included
for the wet-scrubbing processes.  For the ACP an 85%-efficient mechanical
collector is included ahead of the spray dryer.  The remaining fly ash
is removed in the sulfur-salt particulate collectors.

     The limestone scrubbing process  (Figure A-2) uses mobile-bed
absorbers with presaturators and mist eliminators.  A  15% solids slurry
of crushed and ball-milled limestone at a stoichiometric ratio of  1.3

                                    33

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FLUE
GAS
PLENUM
F.D.
FAN
 PRE-
SATU-
RATOR
SO, SCRUBBING
REHEAT
                                                             SLURRY
                                                             SLURRY
                                                          PREPARATION
                                                         WASTE
                                                                     WATER
                                                                     POND
                                                                       TO STACK
                                                                   LIMESTONE
 Figure A-2.  Limestone scrubbing and ponding.

-------
 moles  per mole  of  sulfur removed  is used.  In the ponding variation the
 15%  solids  scrubber purge  stream  is pumped one mile to an earthen-diked,
 clay-lined  pond where  it settles  to a final solids content of 40%.
 Excess water  is returned to  the FGD system.  The pond is sized for the
 remaining life  of  the  power  plant and is designed for a depth that
 minimizes the sum  of land  and construction costs.

     In  the fixation and landfill variation (Figure A-3) the sludge is
 dewatered to  60% solids by thickening and filtration and then blended
 with dry fly  ash and 4% lime (based on FGD waste solids).  The resulting
 wastes are  trucked one mile  to a  landfill site.

     The magnesia  process  (Figure A-4) uses a spray grid column absorber.
 A venturi scrubber for chloride removal is used in place of the presatu-
 rator  for the process  with chloride control.  Chevron mist eliminators
 are  used on both the scrubber and absorber.  The chloride scrubber uses
 absorber liquid and fresh  water.  The chloride scrubber waste stream is
 neutralized with limestone and pumped to the ash pond.  The spray grid
 column uses a 15%  solids slurry of MgO as the absorbent at a stoichi-
 ometry of 1.05  moles of MgO  per mole of sulfur removed and an L/G ratio
 of 10  gal/kft3.  The spent slurry from the absorber, containing magnesium
 sulfite  (MgS03) as the major component, is centrifuged to 85% solids,
 dried  in an oil-fired  dryer, and calcined in a fluid-bed reactor.  The
 MgO  is returned to storage and the S02 is processed to sulfuric acid.
 The  magnesia  scrubbing variation without chloride scrubbing is shown in
 Figure A-5.   It has a  presaturator instead of a chloride scrubber, no
 chloride neutralization system, and a reduced fan size.

     The ACP  (Figure A-6)  is a dry-scrubbing process.  It is based on
 spray  dryer technology in  which a solution of soda ash (Na2C03) absorbent
 is atomized in  the flue gas.  Solution concentration is controlled to
 permit complete evaporation.  The resulting sulfur salts are collected
 as a dry powder.  No reheat  is required in most applications because the
 flue gas is not saturated  and remains sufficiently hot for plume buoy-
 ancy.  The  sodium-sulfur salts are reduced to sodium sulfide (Na2S)
 using  coal  in a molten-salt  reducer.   The Na2S is further processed in a
 series of carbonation  reactions to hydrogen sulfide (H2S), which is
 converted to sulfur in a Glaus plant, and Na2C03, which is reused in the
process.  The ACP has  not  yet been used in commercial application, so
 the design  used in this evaluation is based on vendor and published
information.  However,  a contract has been awarded to Rockwell Inter-
national for a  100-MW  demonstration facility at the Huntley plant of
Niagara Mohawk in Buffalo.   Construction on the 5-year project was
started  in  1979.
                                    35

-------
FLUE
GAS
PLENUM
F.D.
FAN
                     FLY ASH

                     LIME
 PRE-
SATU-
RATOR
SO, SCRUBBING
                                      DEWATERING
                                                   WATER
REHEAT
                                                                                    TO STACK
                                                                SLURRY
                                                     SLURRY
                                                    PREPARATION
                                                                                  LIMESTONE
                             BLENDING
                                                   LANDFILL
 Figure A-3.  Limestone  scrubbing and landfill.

-------
 FLUE
 GAS
PLENUM
                                  SCRUBBER
                                      TO
                                   ASH POND
                                             OIL
                                             OIL
                                                    S02 SCRUBBER
                                                               REHEAT
                                                                        TO STACK
                                                                SLURRY
  SORBENT
DEWATERING
                                            SORBENT
                                          REGENERATION
                                                               SORBENT
                                                            STORAGE  AND
                                                             PREPARATION
              MAKEUP
              'MgO
                                                                     MgO
                                                                   S02
   H2S04
PRODUCTION
                                    PRODUCT
                                   '  ACID
Figure A-4.  Magnesia process.

-------
 FLUE
 GAS
PLENUM
u>
00
F.D.
FAN
                           OIL
                           OIL
                         S09 SCRUBBING
REHEAT
                                                                    TO STACK
                                                 SLURRY
                          SORBENT

                         DEWATERING
                           SORBENT

                        REGENERATION
                                   SORBENT
                                STORAGE AND
                                PREPARATION
                                                     MgO
                          SO,
   H2S04
PRODUCTION
                 MAKEUP
                 MgO
PRODUCT
  ACID
  Figure A-5.  Magnesia process without chloride scrubbing.

-------
FLUE
GAS
PLENUM
 PARTICULATE
     AND
S02 SCRUBBING
                                 FLYASH
                                   TO
                                ASH POND
                                           COAL
                                           SODA
                                           ASH
                                 Na2C03 SOLUTION
                                     TAIL6AS
                                            PARTICULATE
                                              REMOVAL
                                              SORBENT
                                             REDUCTION
                                             1
                                              SORBENT
                                           REGENERATION
                                                                     H,S
                                                          FLYASH
                                                            TO
                                                         ASH POND
                                                   SULFUR
                                                 PRODUCTION
 TO
STACK
  PRODUCT
   SULFUR
 Figure A-6.  Rockwell International AGP.

-------
                                APPENDIX B

                  SYSTEM REVISIONS AND ADDITIONS FOR 1985


 SCRUBBER COST GENERATOR

 New Power Plants and Boilers Through 1985

     Projected boilers scheduled for completion in the years 1980
 through 1985 were added to the data base.  A total of 170 new boilers
 was identified for this period and 50 are included in the 1985 model.
 The remaining 120 projected boilers were not considered for the follow-
 ing reasons.

         Number of boilers
          not considered	   Reason	

                 69          Selected clean fuel for compliance
                 21          Committed to scrubbing
                 13          Incomplete fuel information
                 11          Plant location unknown
                	6          Plant size below 100-MW screen
         Total  120


Updated Regulations and Compliance Plans

     The 1985 projection is based on regulatory data available from EPA
through February 6, 1979.  The major changes in State implementation
plans (SIP's) were in Ohio and Florida.  The Ohio SIP's had not been
finalized at the time of the EPA listing used for the 1983 projection.
The Florida SIP's have been liberalized in the latest listing.  The
revised NSPS are assumed to apply to all boilers coming on stream in
1985, based on estimated time between approval of plans and startup.

FGD Processes

     The 1983 projection used the processes and data as they existed in
the scrubber cost generator in the fall of 1978.  There have been changes
in technology, particularly for the magnesia process, since that time.
The 1985 projection reflects most recent technology changes, many of
which increased the capital and operating costs.  The addition of
chloride scrubbing and neutralization particularly added to the magnesia
scrubbing costs.  A variation of the magnesia process was added without
chloride removal provisions for systems for which chloride scrubbing
might not be required.
                                    41

-------
 AGP

     The AGP was  substituted  for the previously used Wellman-Lord/Allied
 Chemical methane  reduction process for byproduct sulfur production.  The
 AGP  technology has not been demonstrated to the extent nor on the scale
 that the technology used in the 1983 projection had been demonstrated.
 Future process revisions to the AGP could affect the projected FGD
 sulfur market potential in the same way that magnesia process revisions
 affected the FGD  sulfuric acid market potential.  Therefore, the absolute
 quantities and margins of projected FGD byproduct sulfur sales may be
 somewhat uncertain.

 Limestone

     The technology of the limestone process with pond disposal is
 established.  Thus, little change other than escalation of capital and
 operating costs through 1985 was made in its data base.  Limestone
 scrubbing with fixation and landfill was added to the scrubber cost
 generator to provide for those circumstances where ponding of the
 limestone slurry  is not possible.  The fixation system is similar to a
 commercial fixation process such as that employed by IU Conversion
 Systems, Inc. (IUCS).

 Cost Escalation

     Capital costs were escalated through 1985 using the Chemical
 Engineering cost  indexes.  Operating costs were escalated through 1985
 based on TVA projections.
TRANSPORTATION COST GENERATOR

Rail Rate Increase

     Rail rates were projected through 1985 from actual rates in late
1979.  They are expected to double in this 6-year period (approximately
a  105% increase), with a projected annual escalation of 12.7%.

Barge Rate Increase

     Barge rates were also projected through 1985 from actual late 1979
rates.  Application of the waterways users tax and pass-on of this tax
in rates are assumed.  The 6-year increase is projected to be 76%—lower
than the rail rate increase despite the waterways users tax inclusion.
The average annual escalation over this period is projected at 9.9%.

Truck Transport

     Highway transportation costs were added to the model to represent
the most common method of limestone transportation.  The late 1979
average trucking rate of $0.065 is escalated by 10% per year through
1985.


                                    42

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ACID PRODUCTION AND  SULFUR COST GENERATOR

Sulfuric Acid Plant  Data Base

     The sulfuric acid plant capacity data were updated by comparing
information  from several sources.  Additional plants to be in operation
by  1985 were added and some plants indicated as closed were eliminated
from the data base.  Demand in 1985 is equated to 82% of the sulfur-
burning acid plant capacity.

Sulfuric Acid Avoidable Production Cost

     This cost, the  expenditures per ton of sulfuric acid which can be
avoided by shutting  down the sulfur-burning acid plant and buying acid,
was modified to conditions projected for 1985.  The variable conversion
cost was reduced significantly because of the increased byproduct steam
credit.  The sulfur  price at Port Sulphur was increased from the 1983
projection of $62.50/short ton ($70.00/long ton) to $80.00/short ton
($89.60/long ton).   This is roughly equivalent to the late 1979 listed
price per long ton at Tampa ($95.50).  Although Frasch sulfur prices
increased sharply in 1979, the increasing influence of nonvoluntary
recovered sulfur is  expected to have a leveling effect on prices.

     The trend in the United States toward nonvoluntary recovered sulfur
is seen in Figure B-l.  In 1970 voluntary Frasch production constituted
over 59% of  the U.S. production capacity.  By 1981 the Frash capacity
will be about 35% of the total U.S. capacity.  Meanwhile nonvoluntary
sulfur production capacity from refinery operations will have increased
from about 19% in 1967 to almost 38% of U.S. capacity in 1981.  Sour gas
and other nonvoluntary capacity have retained about the same percentage
of U.S. capacity.  Overall, the nonvoluntary sources have increased
their capacity share in the past 10 years from 40% to 65%.

     As shown in Figure B-2 Canadian sulfur production capacity is all
nonvoluntary.  It is predominantly from sulfur removal from sour natural
gas.  The dominance  of the Canadian sour gas sulfur source peaked in
1974 at 93%  of the Canadian sulfur production capacity.  By 1981 it is
projected at about 78% of total Canadian capacity.  The decline is due
to a slight  decline  in sour gas sulfur capacity caused by dilution of
sulfur content in the wells by reinjection of sweetened (sulfur removed)
natural gas  and an increase in refinery sulfur capacity from 3% in 1974
to 16% by 1981.

     The combined North American (U.S. and Canada) situation (Figure B-3)
shows nonvoluntary recovered sulfur increasing from a low of 58% of
North American capacity in 1970 to 78% by 1981.

     Canadian recovered sulfur already has a suppressing effect on the
price (or rather marketable price) of Port Sulphur sulfur in the upper
United States west of Chicago.   The price of sulfur at production points
near Calgary, Alberta, is traditionally substantially below the Port
Sulphur level because of its nonvoluntary nature and freight and


                                   43

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 -
..
-
   28




   26



   24



   22



   20



   I 6
•
V)
§   I
                                        NO  CAPACITY  DATA


                                        CHANGES AVAILABLE


                                        AFTER  1981
                                       7?«7^^-'^.lf7'«v?
                                       •>/ OTHER ;•:>•//.
                                                 '
                                                                                         FRASCH iii'iiiVi1
                                                                                         i-l'l'i1!'!1!1!'!'!'!'!!!!
                                                                                        i ill, 1,111, i|i,i,iiiiiii.i.i
                                                                                        !x! :!!l:i  I';!  iiii1
      67   68   69   70   71    72   73
74   75   76   77

         YEARS
78
79   80    8
82   83    84   85
 Figure B-l.   Sulfur capacities by  source  (1967-1985) -  United  States.

-------
   28




   26




   24




   22




   20




   I 8




"  16

i-



1  i4
GO


Q  I 2
09

2

C
CO
  10



   e



   -:
                                                            NO CAPACITY DATA


                                                            AVAILABLE AFTER



                                                            AFTER I 98 I




                                                           •"-•? OTH
                                             2S?ft?&fs '••'••.••?r-Tr^^K:?::^.
                                          ^M^fcxs;:^^^^
    67  68  69  70   71  72  73  74  75  76  77  78   79  80  81  82  83  84   85



                                      YEARS



 Figure B-2.  Sulfur capacities by source  (1967-1985) - Canada.

-------

03

2
:
 e
 -
c
-
1
                                                                              NO CAPACITY DATA


                                                                              CHANGES AVAILABLE


                                                                              AFTER  1981
                                                        ' i' i' i • i • i • i • i • i • i • i • i • i • i • i • i • i • i • i i -1 • i • i
                                                        i i i  i i i  i i i ri ri I  i i i  i 'i 'i i i 'i
                                                        'ill I I I I I I I I I I l I I I I I I I I1
                                                       i ,  i ii i i i i i,, i i i . - , i-

                                                              i    it
78   79   80
                                                                           81
82   83   84   85
                                                 YEARS
 Figure B-3.   Sulfur  capacities by source (1967-1985)  -  North America.

-------
handling costs.  Figure B-4 shows the approximate competitive  ranges  for
Canadian sulfur at prices of $35, $45, and $55/short  ton less  than  Port
Sulphur prices.  The current competitive range for Calgary recovered
sulfur is probably somewhere between the $35 and $45  limits shown.  An
f.o.b. advantage of $55/short ton would be required for Canadian sulfur
to compete with Port Sulphur Frasch sulfur in the largest U.S.  markets
of central Florida, the lower Mississippi River, and  North Carolina.

     Canadian sulfur is projected for a $45/short ton price, f.o.b.
Calgary, in 1985.  It is substituted at this price plus delivery costs
for those midwestern locations where it is competitive with the
delivered cost of Frasch sulfur from Port Sulphur.

     As in past projections, only the sulfur-burning acid plants are
considered potential markets for FGD sulfuric acid (and, in the 1985
projection, for FGD sulfur).  The relative capacity of sulfur-burning
acid plants compared with other sulfuric acid sources has declined
slightly in the United States in the past dozen years.  The total
capacity of sulfur-burning acid plants has increased substantially,
however, as seen in Figure B-5.  Both the share and the total amount  of
smelter sulfuric acid capacity have increased significantly but appear
to be leveling off, as has sulfuric acid produced from refinery sludge.

     The sulfuric acid production capacities for Canada by type of feed-
stock are shown in Figure B-6.  The percentage of sulfuric acid capacity
in Canada from sulfur feedstock has dropped from over 73% in 1967 to
under 53% in 1981 even though the total amount of sulfur-burning capacity
has increased.  Smelter sulfuric acid and other unidentified feedstocks
have increased in the same period from about 27% to 47% of total Canadian
sulfuric acid capacity.  There is no  refinery sludge sulfuric acid
production in Canada unless it is in  the unidentified feedstock
("other") category shown.

     Canadian total sulfuric acid capacity, however, makes up less than
10% of total North American capacity.  Therefore, as seen  in Figure B-7,
the profile of capacities by feedstock for North America  is very similar
to that for the United States.  The total capacity for  the United  States
amounts to over 57 million tons of the roughly  65 million  tons of  North
American capacity projected for  1981, the last  year  for which capacity
change data are available.

     The transportation and handling  data as  they apply to  the delivered
cost of sulfur through acid plants, and  thus  the  avoidable  production
costs, have also been updated  through 1985.   Rail and barge transportation
have escalated as shown for the  transportation  data base  and handling at
the terminal has been escalated  at a  much lower rate since much of this
cost is related  to fixed costs on existing  capital investments.

Market Simulation Linear Programming  Model

     The most  important change from previous  studies is the inclusion of
FGD byproduct  sulfur in the marketing system.   Canadian sulfur is  included

                                    47

-------
                         • CALGARY
i
                                        SULPHUR)-$35
                               PORT;SULPHUR
                                                            :4;POR
                                                              SULPHUR
                                              -
      Figure B-4.  Cost-competitive ranges  for Canadian sulfur at different f.o.b. Canadian sulfur
                 prices  (short ton) below Port Sulphur price.

-------

                                                                          REFINERY  SLUDGE
                                                                                  ;SMELTER
                                                                                  /////
                                                                         0  CAPACITY  DATA
                                                                         RANGES  AVAILABLE
                                                                        AFTER  I 98 I
     67   68   69   7O  71   72   73   74   75  76   77   78   79   8O   81   82  83   84   85
                                               YEARS
Figure B-5.  Sulfuric acid  capacities  by feedstock (1967-1985) - United  States.

-------
-
   03
   z
   C
•-•
-
1
.
   ••
   -
   -
   :
   x
                                               NO CAPACITY  DATA

                                               CHANGES AVAILABLE

                                               AFTER  I 98
                                         mmrnmmm



      67  68  69  70  71 72 73  74  75   76 77 78  79  80  81 82 83 84  85
   Figure B-5. Sulfuric acid capacities by feedstock (1967-1985) - Canada.

-------
.
a
 -
 :
-.
«.
B3
a
c
i
                                                                                    OTHER
                                                                         REFINERY  SLUDGE


                                                                                         I
                                                                                  SMELTER^
                                                                        NO  CAPACITY  DATA
                                                                        CHANGES  AVAILABLE
                                                                        AFT     I 98 I
     67  68   69   70   71   72   73  74   75   76   77   78   79  8O  81   82   83   84
 Figure B-7.  Sulfuric acid  capacities  by feedstock (1967-1985) - North America.

-------
as a competitive source at $45/short ton, Calgary, along with Frasch
sulfur at $80/short ton, Port Sulphur.  Other FGD sulfur marketing
conditions are a minimum annual production rate screen of 5,000 short
tons and a maximum incremental production cost screen of $100/short ton.
An incremental production cost higher than the Port Sulphur rate is used
to allow for possible power plant marketing advantages because of loca-
tion.  Significant changes to the sulfuric acid marketing data are
screens of a minimum of 40,000 short tons of annual FGD production and a
maximum incremental production cost of $45/short ton.

     The ACFL of $0.50/MBtu used in the 1983 projection was dropped, the
$0.70 and $1.00 ACFL were retained, and a $1.25 ACFL level was added.
Provisions were also made to reflect the revised 1979 NSPS for 1985
boilers.  The new regulations require a minimum of 70% sulfur removal,
and thus force an FGD comparison regardless of the ACFL since the option
to use a clean fuel compliance strategy alone no longer exists with the
revised NSPS.
                                   52

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                                TECHNICAL REPORT DATA
                          (Please read Instructions on the reverse before completing)
 1. REPORT NO.
  EPA-600/7-80-131
                           2.
                                                      3. RECIPIENT'S ACCESSION NO.
 4. TITLE ANDSUBTITLE
 Projection of 1985 Market Potential for FGD
  Byproduct Sulfur and Sulfuric Acid in the U.S.
                                  5. REPORT DATE
                                  July 1980
                                  6. PERFORMING ORGANIZATION CODE
 7. AUTHOR(S)
 W.E.O'Brien, W.L.Anders, and J.D.Veitch
                                  8. PERFORMING ORGANIZATION REPORT NO.

                                  TVA EDT-115
 9. PERFORMING ORGANIZATION NAME AND ADDRESS
 TVA, Office of Power
 Div.  of Energy Demonstrations and Technology
 Muscle Shoals, Alabama 35660
                                  10. PROGRAM ELEMENT NO.
                                  INE624A
                                  VL CONTRACT/GRANT NO.
                                  EPA Inter agency Agreement
                                   D9-E721-BI
 12. SPONSORING AGENCY NAME AND ADDRESS
 EPA, Office of Research and Development
 Industrial Environmental Research Laboratory
 Research Triangle Park, NC 27711
                                  13. TYPE OF REPORT AND PERIOD COVERED
                                  Final; 1/79-4/80	
                                  14. SPONSORING AGENCY CODE
                                   EPA/600/13
 ^.SUPPLEMENTARY NOTES TERL_RTp project officer
 2489,
 ,6. ABSTRACT The report projects the 1985 market potential for flue gas desulfurization
 (FGD) byproduct sulfur and sulfuric acid in the U.S. The projection is 165,000 tons
 of sulfur from 11 power plants  and 554,000 tons of acid from 6 power plants, with a
 combined benefit to the affected industries of #20 million. FGD technology improve-
 ments and cost increases, particularly for fuel oil,  enhanced the FGD sulfur market
 potential and decreased the FGD sulfuric acid potential, relative to previous projec-
 tions. The 1979 revised New Source Performance  Standards (NSPS), and the require-
 ment (in many cases) for FGD waste treatment, improved the potential for both pro-
 ducts. The revised NSPS, which preclude low-sulfur coal as an option, greatly incr-
 ease the FGD market potential for plants coming on  line after the mid-1980s. Fuel-
 oil cost escalation is important in reducing FGD sulfuric acid market potential, as
 are process  modifications for  chloride control.  Limestone scrubbing with waste
 sludge ponding remains the economically predominant option. The limestone scrub-
 bing advantage is decreased, however, when extensive waste treatment and landfill
 are required.
 7.
                             KEY WORDS AND DOCUMENT ANALYSIS
                DESCRIPTORS
                                          b.lDENTIFIERS/OPEN ENDED TERMS
                                              c." COSATI Field/Group
Pollution
Flue Gases
 Desulfurization
Sulfur
 ulfuric Acid
 Byproducts
Marketing
Calcium Carbonates
Scrubbers
Sludge
Ponds
Pollution Control
Stationary Sources
13B      05C
21B
07A,07D 131
07B
         08H
14G
 8. DISTRIBUTION STATEMENT
 Release to Public
                                          19. SECURITY CLASS (This Report)
                                          Unclassified
                                              21. NO. OF PAGES

                                                68
                      20. SECURITY CLASS (Thispage)
                      Unclassified
                                                                  22. PRICE
EPA Form 2220-1 (9-73)
                                        53

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