Tennessee Valley
Authority
U.S. Environmental Protection Agency
Office of Research and Development
National Fertilizer
Development Center
Muscle Shoals AL 35660
Industrial Environmental Research EPA-600/7-78-192
Laboratory October 1978
Research Triangle Park NC 27711 TVA Bulletin Y 137
Feasibility of Producing
and Marketing Byproduct
Gypsum from SO2
Emission Control at
Fossil-Fuel-Fired
Power Plants
nteragency
Energy/Environment
R&D Program Report
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RESEARCH REPORTING SERIES
Research reports of the Office of Research and Development, U.S. Environmental
Protection Agency, have been grouped into nine series. These nine broad cate-
gories were established to facilitate further development and application of en-
vironmental technology. Elimination of traditional grouping was consciously
planned to foster technology transfer and a maximum interface in related fields.
The nine series are:
1. Environmental Health Effects Research
2. Environmental Protection Technology
3. Ecological Research
4. Environmental Monitoring
5. Socioeconomic Environmental Studies
6. Scientific and Technical Assessment Reports (STAR)
7. Interagency Energy-Environment Research and Development
8. "Special" Reports
9. Miscellaneous Reports
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
Development Program. These studies relate to EPA's mission to protect the public
health and welfare from adverse effects of pollutants associated with energy sys-
tems. The goal of the Program is to assure the rapid development of domestic
energy supplies in an environmentally-compatible manner by providing the nec-
essary environmental data and control technology. Investigations include analy-
ses of the transport of energy-related pollutants and their health and ecological
effects; assessments of, and development of, control technologies for energy
systems; and integrated assessments of a wide range of energy-related environ-
mental issues.
EPA REVIEW NOTICE
This report has been reviewed by the participating Federal Agencies, and approved
for publication. Approval does not signify that the contents necessarily reflect
the views and policies of the Government, nor does mention of trade names or
commercial products constitute endorsement or recommendation for use.
This document is available to the public through the National Technical Informa-
tion Service, Springfield, Virginia 22161.
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TVA BULL.Y-137
EPA-600/7-78-192
October 1978
Feasibility of Producing
and Marketing Byproduct Gypsum
from SO2 Emission Control at
Fossil-Fuel-Fired Power Plants
by
J. M. Ransom, R. L Torstrick, and S. V. Tomlinson
Tennessee Valley Authority
National Fertilizer Development Center
Muscle Shoals, Alabama 35660
EPA Interagency Agreement D8-E721-BJ
Program Element No. INE624A
EPA Project Officer: Julian W. Jones
Industrial Environmental Research Laboratory
Office of Energy, Minerals, and Industry
Research Triangle Park, NC 27711
Prepared for
U.S. ENVIRONMENTAL PROTECTION AGENCY
Office of Research and Development
Washington, DC 20460
-------
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 major purpose of the study was to identify fossil-fired power
plants that might, in competition with existing sources of crude gypsum
and other power plants, lower cost of compliance with SC>2 regulations by
producing and marketing abatement gypsum.
It was estimated that 187 fossil-fired power plants will be out of
compliance with existing SC>2 regulations in 1978. Of these, 71 were
assumed to use low-sulfur fuel in lieu of a flue gas desulfurization
strategy to meet compliance due to extremely high absolute flue gas
desulfurization costs. Total first-year costs for the remaining 116
plants to install and operate the limestone slurry flue gas desulfuri-
zation system is $2 billion to remove 4 million tons of sulfur. Since
only 3 of the 116 plants are located in Western States near gypsum-
producing areas, the gypsum production alternative is not considered a
viable or important alternative to steam plants in Western States. In
the eastern part of the United States, however, gypsum production was
shown to have a limited but important potential to lower cost of com-
pliance by power plants. Gypsum consumption was projected to amount to
2 million tons in wallboard use and 3 million tons in cement, and total
value of sales in 1978 was estimated at $124.4 million in that region.
Total potential gypsum production by the 113 steam plants in the
eastern part of the United States amounts to 27 million tons. For about
90% of the potential abatement gypsum production, the cost difference
between producing gypsum and producing conventional sulfite sludge by
limestone scrubbing is greater than the estimated cost of mining natural
gypsum. Thirty power plants (generally smaller than 200 MW) with small
annual outputs were identified that could reduce compliance cost by
producing and marketing abatement gypsum. The thirty plants would
replace 2,230,000 tons of crude gypsum at 93 demand points (92 cement
plants and one wallboard plant). Seventy-four percent of the gypsum
replaced is imported material. Total first-year saving to steam plants
is $11 million and about $2 million is saved by the gypsum industry.
Production of gypsum instead of sludge as a means of compliance with
S02 regulations was shown to be suited to small, new plants and may well
fill an important role in a total program of byproduct marketing by
steam plants in meeting compliance.
iii
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CONTENTS
Abstract iii
Figures viii
Tables x
Abbreviations, Glossary, and General Conversion Factors xii
Executive Summary xvii
Introduction 1
Objectives of the Study 3
Background of the Study 4
Methods and Procedures 5
Organization of the Study 6
The Gypsum Industry 7
The Mineral Gypsum 7
History 8
Gypsum Reserves 8
Gypsum Mining • 10
Industry Characteristics 17
Seasonal Distribution Patterns 17
Integration 19
Concentration 20
Product Differentiation 21
Entry Conditions 21
Prices 23
Markets for Abatement Gypsum 27
Technical Substitution 27
Characteristics of Wallboard Market 29
Characteristics of Cement Market for Gypsum 35
Characteristics of Agricultural Markets. ... 33
Growth in Demand for Gypsum 40
Potential New Markets 43
The Mobile Home Industry 43
Agricultural Use of Gypsum Under Changing Conditions 43
Projected Gypsum Use - 1978 45
New Plant Locations 47
v
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Method of Analysis of Abatement Gypsum Market Potential 49
Data Base Development 49
Short-Run Demand 50
Calcining Plants 51
New Plant Locations 52
Cement Plant Data Base 53
Supply 53
Supply Prices 55
FGD Cost Comparisons 59
Design Premises 59
Cost Premises 62
Process Descriptions • 64
Limestone Slurry Process 65
Limestone-Gypsum Process 65
Chiyoda Thoroughbred 101 FGD Process 71
Dowa Aluminum Sulfate-Gypsum Process 74
Other Gypsum-Producing Processes 78
Economic Evaluation and Comparison 78
Capital Investment 78
Revenue Requirements 79
Lifetime Revenue Requirements 92
Estimate Limitations , 92
Supply of Abatement Gypsum 101
Total Potential Supply 101
Variability in Incremental Cost 103
Market Potential for Abatement Gypsum 107
Market Model 108
Market Analysis 109
Maximum Noncompetitive Supply of Abatement Gypsum 109
Distribution of Abatement Gypsum at Approximate Market
Equilibrium 112
Distribution Limited to Calcining Plants 119
Distribution to Cement Plants with Price Reduction 120
Potential New Calcining Plant Supply of Abatement Gypsum .... 120
Conclusions and Recommendations. . 123
Conclusions 123
Recommendations 125
References 127
VI
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Appendices
A Other Gypsum-Producing Processes 131
B Operating and Investment Tabulations 145
C Characteristics of the Power Utility Industry 191
D S02 Emission Regulations and Applications 213
E Scrubbing Cost Generator 223
vii
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FIGURES
Number Page
S-l The locations of steam plants that could lower cost of
compliance by producing and marketing gypsum xxvi
S-2 Location of demand points for byproduct gypsum produced
by steam plants xxvii
1 Location of gypsum-producing districts in North America. . 11
2 Location of domestic gypsum mines, 1975
(Mineral Industry Surveys) 12
3 Location of domestic calcining plants, 1975
(Mineral Industry Surveys) 13
4 Observed and predicted consumption of wallboard products,
1955-1975 32
5 Location of domestic cement production plants, 1975
(Portland Cement Association) 35
6 Location of domestic gypsum mines, 1975
(Mineral Industry Surveys) 54
7 Limestone slurry process. Flow diagram 55
8 Limestone slurry process. Material balance 57
9 Limestone-gypsum process. Flow diagram. 68
10 Limestone-gypsum process. Material balance 69
11 Chiyoda Thoroughbred 101 FGD process. Flow diagram. ... 72
12 Chiyoda Thoroughbred 101 FGD process. Material
balance 73
13 Dowa aluminum sulfate-gypsum process. Flow diagram. ... 75
14 Dowa aluminum sulfate-gypsum process. Material
balance 76
15 Limestone slurry and limestone-gypsum processes.
Effect of power unit size on total capital investment. . . 85
16 Limestone-gypsum process. Effect of power unit size
and percent sulfur on total capital investment 86
17 Limestone slurry and limestone-gypsum processes.
Effect of power unit size on average annual revenue
requirement 93
18 Limestone slurry process. Effect of power unit size
and percent sulfur on revenue requirements in mills/
kWh 94
19 Limestone-gypsum process. Effect of power unit size
and percent sulfur on revenue requirements in mills/
kWh 95
20 Limestone slurry and limestone-gypsum processes.
Effect of power unit size and limestone cost on average
annual revenue requirement 96
viii
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FIGURES (continued)
Number
21 Differential revenue requirement between limestone
slurry and limestone-gypsum. Effect of power unit
size and percent sulfur on incremental revenue
requirements. Byproduct revenue excluded from total
revenue requirements 97
22 Steam plant locations calculated to exceed compliance
regulations, 1973 102
23 The locations of 30 steam plants that could lower cost
of compliance by producing and marketing gypsum 114
24 The location of demand points 115
ix
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TABLES
Number . Page
S-l Summary of Total Annual Revenue Requirements xxiil
1 Gypsum Mining Costs in Canada - 1970-74 15
2 Gypsum Mining Costs Per Ton in Canada - 1970-74 16
3 Seasonal Distribution of Wallboard Products—Sales by
Quarters of the Years - 1970-74 17
4 Gypsum Use, Production, and Value - 1955-75 18
5 Crude Gypsum Mine Numbers, Calcining Plant Numbers,
and Ownership Patterns - 1970-75 20
6 Gypsum Use and Value by Major Consuming Sector 24
7 Gypsum Products, Average Annual Value at Plant, Average
Value Crude Gypsum at Mine, and Value of Gypsum as Per-
cent of Product Value - 1972 Constant Dollars 31
8 Quantity Prefabricated Wallboard Products Consumed,
Value of Construction, and Residential Construction
as a Percent of Total Construction 33
9 Number Calcining Plants, Annual Tons Gypsum Calcined,
and Average Plant Use, 1970-75 34
10 Portland Cement, U.S. Demand, Production, Prices, and
Imports - 1964-75 37
11 Peanut Production by States - 1974 39
12 Gypsum Use by Major Markets, ktons 41
13 Forecasts of Gypsum Use, ktons 42
14 Potential Consumption of Sulfur as a Plant Nutrient in
the United States by Regions and Equivalent Gypsum .... 44
15 Gypsum Use, Production, and Value - 1955-75 46
16 Regional Consumption Wallboard Products and Percent of
Total U.S. Consumption, Compared to Regional Produc-
tion, 1975 48
17 Gypsum Use and Value by Major Consuming Sector 57
18 Assumed Power Plant Capacity Schedule 60
19 Projected 1978 Unit Costs for Raw Materials, Labor,
and Utilities 64
20 Limestone Slurry Process - Summary of Estimated Fixed
Investment 80
21 Limestone-Gypsum Process - Summary of Estimated Fixed
Investment 81
22 Chiyoda Thoroughbred 101 FGD Process - Summary of
Estimated Fixed Investment 82
23 Dowa Basic Aluminum Sulfate-Gypsum Process - Summary
of Estimated Fixed Investment 83
x
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TABLES (continued)
Number
24 Comparison of Base Case Investment Requirements for
Four FGD Processes 84
25 Limestone Slurry Process - Total Average Annual Revenue
Requirements - Regulated Utility Economics 87
26 Limestone-Gypsum Process - Total Average Annual Revenue
Requirements - Regulated Utility Economics 88
27 Chiyoda Thoroughbred 101 FGD Process - Total Average
Annual Revenue Requirements - Regulated Utility
Economics 89
28 Dowa Basic Aluminum Sulfate-Gypsum Process - Total
Average Annual Revenue Requirements - Regulated
Utility Economics 90
29 Comparison of Annual Revenue Requirements for Four FGD
Systems at Base Case Conditions 91
30 Summary of Limestone Slurry and Limestone-Gypsum
Levelized Unit Revenue Requirements 98
31 Tons of Gypsum Produced at Steam Plants East of Rocky
Mountains at Calculated Levels of Incremental Cost Per
Ton of Gypsum Compared to Limestone Scrubbing 104
32 Summary of Projected Annual Use by Wallboard Plants by
Size - 1978 (Eastern U.S.) 107
33 Summary of Projected Annual Use by Cement Plants by
Size - 1978 (Eastern U.S.) 108
34 Abatement Gypsum Production Cost, Distribution for
Cement Production, and Revenue - Example Plant Ill
35 Summary of Steam Plants Calculated to Produce and
Market Abatement Gypsum, and Net Revenue Per Plant .... 113
36 Summary of Analysis Results jig
37 Summary of Projected Steam Plant Characteristics, 1978 . . HQ
38 Summary of Steam Plants Calculated to Produce and Market
Abatement Gypsum to Wallboard Plants Only 119
39 Location of Steam Plants with Potential Annual Gypsum
Production Between 200 and 400 ktons 121
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ABBREVIATIONS, GLOSSARY, AND GENERAL CONVERSION FACTORS
ABBREVIATIONS
ACFL
AQCR
EPA
FGD
FPC
Ga
ka
Ma
NAAQS
NSPS
SIP
SMSA
T
TVA
UOP
Alternative clean fuel level
Air Quality Control Regions
U.S. Environmental Protection Agency
Flue gas desulfurization
Federal Power Commission
Billion (109)
Thousand (103)
Million (106)
National Ambient Air Quality Standards
New Source Performance Standards
State Implementation Plans
Standard Metropolitan Statistical Areas
Trillion (1012)
Tennessee Valley Authority
Universal Oil Products
a. Although British units are used in this report,
the International System of Units (SI) symbols
are used in transition to the metric system.
XI1
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GLOSSARY
Alternative clean fuel level: The value assigned to premium price for
fuel that will meet the sulfur oxide emission standard.
Anhydrite: Anhydrous calcium sulfate (CaSO^).
Capacity factor: Throughout this study capacity factor is defined and
calculated as the ratio of the annual quantity of heat consumed in
the boiler in comparison to the quantity that would have been con-
sumed if the boiler operated at rated capacity (full load) for the
entire year (8760 hr). For steam electric boilers, this definition
is equal to capacity factors calculated in terms of either steam or
electricity generation.
Chiyoda process: A process developed by Chiyoda Engineering Company in
Japan to remove sulfur oxide from flue gas, oxidize the sulfur oxide
to produce dilute sulfuric acid, and react the acid with limestone
to produce gypsum.
Competitive equilibrium solution: Represented by the long-run break-even
market condition which comes at a critical price where identical
firms just cover their full competitive costs. At a lower long-run
price, firms would leave the industry until prices return to the
critical equilibrium level; at higher long-run price, new firms
would enter the industry replicating what existing firms are doing
and thereby force market price back down to the long-run equilibrium
price where all competitive costs are just covered.
Dowa process: A process developed by Dowa Mining Company in Japan to
remove sulfur oxide from flue gas by scrubbing with aluminum sulfate
solution, oxidizing the absorbed sulfur dioxide, and regenerating
the absorber solution by adding limestone to precipitate gypsum.
Form 67: Federal Power Commission form used to report annual steam-
electric plant and water quality control data.
Gypsite: Impure gypsum (less than 70%
Gypsum:
xiit
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Limestone-gypsum process: A process for removing sulfur oxides from
flue gas and converting the waste product to calcium sulfate by
forced oxidation.
Limestone slurry scrubbing: A process for removing sulfur oxides from
flue gases by scrubbing the gases in a tower with a limestone slurry.
The resulting slurry of calcium sulfites, sulfates, unreacted lime-
stone, etc., is sent to a disposal pond where the solids settle out
with no further treatment.
Market demand: Amount of goods that buyers are ready to buy at each speci-
fied price in a given market at a given time (also called demand
schedule).
Market supply: Amount of goods that sellers are ready to sell at each
specified price in a given market at a given time (also called a
supply schedule).
Phosphogypsum: Gypsum byproduct of phosphoric acid production.
xiv
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GENERAL CONVERSION FACTORS
EPA policy is to express all measurements in Agency documents in
metric units. Values in this report are given in British units for the
convenience of engineers and other scientists accustomed to using the
British system. The following conversion factors may be used to provide
metric equivalents.
Conversion Factors for Metric Equivalents of British Units
British
Metric
ac
bbl
Btu
ft3
gal
Ib
lb/ft3
Ib/hr
ton
ton/hr
acre
barrels of oil
British thermal unit
cubic feet
gallons
pounds
pounds per cubic foot
pounds per hour
tons (short).
tons per hour
0.405
158.97
252
0.02832
3.785
0.4536
16.02
0.126
0.90718
0.252
hectare
liters
cubic meters
liters
kilograms
kilograms per cubic
meter
grams per second
metric tons
kilograms per second
ha
1
m3
1
kg
kg/m3
g/sec
t
kg/sec
XV
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FEASIBILITY OF PRODUCING AND MARKETING BYPRODUCT GYPSUM FROM
S02 EMISSION CONTROL AT FOSSIL-FUEL-FIRED POWER PLANTS
EXECUTIVE SUMMARY
The passage of the Clean Air Act in 1967 and the various amendments
have prompted increased efforts by government and industry to reduce
pollutants in emissions from fossil-fired power plants. Stack gas
scrubbing processes for removal of S02 emissions have received the most
attention. There are alternative systems of scrubbing for removal of
S02 emissions; but the lime-limestone systems which absorb the S02 and
convert it to solid compounds of calcium sulfites and sulfates, which
are then discarded, have been most widely applied by the industry.
Those processes are called "throwaway" processes. In general, they are
less expensive to install and operate than alternative scrubbing systems.
However, the throwaway product has no economic value, is costly to
discard, may create future problems of ground water pollution, and
wastes sulfur, a vital resource.
Processes recovering the S02 in useful form are potentially supe-
rior to the lime-limestone methods because they overcome the disadvan-
tages associated with the wastes from throwaway systems. Before such
systems will be put into use, however, there must be confidence that the
useful byproduct will generate adequate sales revenue to offset addi-
tional cost, if any, of the alternative systems. The U.S. Environmental
Protection Agency (EPA) and the Tennessee Valley Authority (TVA) have
conducted studies to evaluate the feasibility of marketing byproducts
from S02 emission control. The design of the system(s) chosen was
developed from available data, costs were estimated on a uniform basis,
and potential markets were determined for the byproducts.
A major purpose of this study was to evaluate the existing wallboard
products industry and cement industry as markets for abatement gypsum
produced by an S02 emission control system. Gypsum-producing systems
are in use on oil-fired boilers in Japan and the resultant product is
used successfully in wallboard manufacturing. Samples of gypsum from a
pilot operation on a coal-fired facility in Florida have been success-
fully used in wallboard manufacturing under commercial conditions.
xvn
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The wallboard products manufacturing industry is currently the
dominant user of gypsum. This market potential has been given major
attention, but consideration has also been given to potential uses in
the cement industry. The major objectives of the study were:
1. To identify basic conditions of supply and demand for the gypsum
industry.
2. To characterize demand and projected growth in demand by major
markets.
3. To identify potential problems in market entry and to suggest
market strategies.
4. To evaluate costs for several different gypsum-producing flue
gas desulfurization (FGD) systems and to develop cost estimates
for representative systems.
5. To further develop and improve an analytical model for conducting
abatement product marketing investigations.
6. To apply the model to determine optimum strategies for the industry
on a plant-by-plant basis and in total.
7. To suggest further research needs.
The study was approached in four sequential steps. The existing
gypsum industry was analyzed first to determine the market potential for
abatement gypsum. Specific quantities and costs were developed for each
demand point and for the total industry. Next, the cost of S02 emission
control by gypsum-producing processes was compared with the limestone
throwaway system to determine a basis for the supply of abatement gypsum
from which the total potential production and costs were calculated.
Then the revenue based on the replacement of crude gypsum was determined
and compared with calculated production costs. Specific plants were
identified that have an economic incentive to control SC>2 emissions by
gypsum production. Results, conclusions, and limitations were summarized
in the final step.
MAJOR ASSUMPTIONS
The study was conducted under the premise that all steam plants
must operate in compliance with existing S02 regulations. It was assumed
that use of low-sulfur fuel is an available alternative to meet compliance.
A premium (incremental) cost of $0.70/MBtu (M = 1 million) heat input
was assumed for complying fuel. Determination of actual premium value
was beyond the scope of the study; the level chosen is a reasonable
economic screen. Boilers were not considered to be candidates to install
an FGD system when calculated cost of scrubbing exceeded $0.70/MBtu heat
input. All remaining boilers were assumed to install the limestone
xviii
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throwaway system unless revenue from sale of abatement gypsum was ade-
quate to offset or exceed the additional cost of the gypsum-producing
SC>2 emission control system. Abatement gypsum was assumed to be inter-
changeable with natural gypsum in the manufacture of wallboard and
cement. Revenue generated from sales of abatement gypsum was based on a
projected quantity and delivered cost of crude gypsum to each currently
existing demand point. Any demand point was assumed to purchase abate-
ment gypsum if cost was equal to or less than estimated current delivered
cost of crude gypsum. The study focused on supply to users of gypsum
and not on markets for the end products.
THE GYPSUM INDUSTRY
Gypsum is a naturally occuring nonmetallic mineral found in almost
limitless deposits in many parts of the world. Reserves exist in many
sections of the United States with the notable exception of coastal
areas and the Southeast. Crude gypsum consumed in the areas without
natural reserves is mostly imported from Canada. Imports historically
account for 35-40% of our domestic needs.
Gypsum is a low-value product since mining costs are low. Variable
costs of mining were estimated for purposes of this study at $3/ton for
domestic mines and $2/ton in Canada. The costs are estimated to be
lower in Canada because the quality of reserves is generally better than
in the United States. Mining costs vary among regions and by type of
mining method used, however, differences could not be quantified.
Domestic gypsum consumption is highly variable and follows the
fortunes of the building industry. The year 1973 was a record for the
gypsum industry in the United States when consumption amounted to over
20 Mtons. Domestic production was 13,558 ktons (k = 1 thousand) with an
average reported mine value of $4.18/ton (see "Gypsum" by Avery H. Reed,
in 1973 Minerals Yearbook, Vol. I, Metals, Minerals, and Fuels, pp. 593-
599, published by the U.S. Bureau of Mines, U.S. Department of Interior,
U.S. Government Printing Office, Washington, D.C., 1975). Imports
amounted to 7,661 ktons with an average reported mine value of $2.30/ton.
Three major markets exist for crude gypsum: (1) the wallboard products
industry, 73%; (2) the cement industry, 20%; and (3) agriculture, 7%.
According to long-range projections made by the U.S. Bureau of Mines,
gypsum use is expected to grow at an annual rate of 1.5-2.0%. Growth is
expected in each of the major markets. In addition, the mobile home
industry may develop into a new market for wallboard as a result of
recent changes in Federal and local building codes.
The wallboard products portion of the industry is both highly
concentrated and highly integrated from mining through wallboard manu-
facture. Entry barriers, now rated high, could be lowered if abatement
gypsum does become available. Entry barriers are high partly because
the firm controls reserves as well as manufacturing plants. In areas
xix
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where reserves are not available, the firm normally owns or contracts
foreign reserves and attendant facilities to enable ocean transport at
minimum cost. If abatement gypsum were available, the wallboard plant
would be the only capital investment required to enter the industry.
Most of the gypsum used in the cement industry is purchased from
the open market rather than being supplied from captive mines. Cement
plants are widely scattered and shipping costs add significantly to
delivered costs. Therefore, the logistics and market entry conditions
would favor sales of byproducts to the cement industry.
Data bases were developed for the wallboard products industry and
the cement industry. The data bases include an estimate of projected
gypsum use in 1978 at each wallboard plant and each cement plant based
on use in 1973 (the year of maximum consumption). The data bases also
include estimated minimum delivered cost of crude gypsum to each demand
point. Delivered costs to wallboard plants were based on estimated
variable mining cost of $3/ton f.o.b. domestic mine or $2/ton f.o.b.
foreign mine. In each case, the company-owned mine was considered the
supply point for the wallboard plant. The price to the cement industry
was based on the current value of crude gypsum used in the cement
industry estimated at $6/ton f.o.b. mine. The two-price system was used
because gypsum for wallboard product plants is supplied from captive
mines at a lower cost than gypsum for cement.
There was little precedent to draw upon to predict how present
crude gypsum producers would react in pricing their product to compete
with abatement gypsum. All wallboard producers own or contract their
own supplies of crude gypsum. These producers also.supply gypsum
requirements of the cement industry in an open market.
It was assumed that the integrated producers would continue to mine
and distribute crude gypsum to their wallboard plants as long as they
met variable cost of mining as estimated above. Since gypsum sales to
the cement industry are made in an open market, gypsum producers would
be reluctant to lower existing market prices on all crude gypsum sales
to compete with localized production of abatement gypsum. For these
reasons, the two-price system was used in the major portion of the
analysis. Other price situations were also evaluated and reported.
This data base provides total tonnage and revenue potential for
abatement gypsum in existing markets. Only three steam plants in the
Western United States were found to be candidates to install an FGD
system. These three plants are located near gypsum-producing areas.
For practical purposes, therefore, the gypsum-producing alternative is
not a viable or important alternative for steam plants in the West. The
analysis that follows is limited to the Eastern United States.
Projected consumption in 1978 in the Eastern United States is 15 Mtons.
Located in this area are 55 wallboard plants and 132 cement plants.
Wallboard plants will consume about 12 Mtons and cement plants about 3 Mtons.
xx
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Total imports will amount to 5.9 Mtons. Wallboard plants will consume
4.8 Mtons and cement plants will consume 1.1 Mtons of imported material.
The total delivered cost of gypsum to demand points in 1978 was estimated
at $124,400k with an average value per ton of $8.27. This represents
the maximum revenue potential to the utility industry from sales of
abatement gypsum in 1978.
FGD COST COMPARISONS
Three gypsum-producing FGD systems—limestone-gypsum, Chiyoda
Thoroughbred 101, and Dowa aluminum sulfate—were chosen to be evaluated
in this study. In addition, costs for the limestone slurry throwaway
system originally developed by TVA were updated to the same base condi-
tions. A brief description of each process follows:
1. Limestone slurry process. Downstream of an electrostatic pre-
cipitator (ESP) which is used for particulate removal, stack gas
is washed in a mobile-bed absorber with a recirculating slurry of
limestone and reacted calcium salts to remove S02. Limestone
feed is wet ground prior to addition to the absorber effluent
hold tank. Calcium sulfite and sulfate salts are withdrawn to a
disposal area for discard. Cleaned gas from the absorber is
reheated to 175 F before exiting the stack. Design is based on
data taken from the EPA-TVA-Bechtel Shawnee test program.
2. Limestone-gypsum process. Particulate and S02 removal is accom-
plished in the same manner as in the limestone slurry process. A
bleedstream from the absorber is fed to a neutralization reactor
where it is contacted with 98% sulfuric acid to convert excess
calcium carbonate in the slurry to gypsum and to lower the pH of
the stream to approximately 4.0-4.5 to facilitate downstream
oxidation. The reaction product is fed to a high-pressure
oxidizer where calcium sulfite in the slurry is contacted with
air to form gypsum. The gypsum product is dewatered by thickener
and belt filter and conveyed to a storage area. The process
(based on Japanese technology) is a conceptual design developed
by TVA to be used for comparison with other gypsum-producing
processes.
3. Chiyoda 101 process. After particulate removal in an ESP, gas is
contacted with a dilute (2-3%) sulfuric acid solution in a
specially designed absorber-oxidizer vessel to convert S02 to
sulfuric acid. Rich liquor is withdrawn from the absorber and
reacted with a limestone slurry in a Chiyoda-designed crystallizer
to form gypsum. Limestone feed is wet ground prior to addition
to the crystallizer. Overflow from the crystallizer is clarified
and returned to the absorber as scrubbing liquor. The gypsum
product is dewatered by rotary drum filter and conveyed to a
storage area. The process has been developed by Chiyoda Chemical
Engineering and Construction Company, Ltd., Yokohama, Japan.
xxi
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4. Dowa process. Following an ESP for particulate removal, stack
gas is contacted in a mobile-bed absorber with an aluminum
sulfate solution to remove S02. A bleedstream from the absorber
is contacted with air in an oxidizer to convert aluminum sulfite
to aluminum sulfate. The aluminum sulfate is reacted with lime-
stone in neutralizing tanks to form the gypsum product and
regenerate scrubbing liquor which is recycled to the absorber.
Limestone feed is wet ground prior to addition to the neutralizing
tanks. The gypsum product is dewatered by thickener and drum
filter and conveyed to a storage area. The process has been
developed by the Dowa Mining Company, Ltd., Tokyo, Japan.
Design and economic factors chosen to provide a consistent base for
comparison of the processes are defined below.
1. Project schedule and location. Project assumed to start in mid-
1975 with a 3-year construction period ending mid-1978. Average
cost basis for scaling, mid-1977; startup mid-1978. A midwestern
plant location is assumed.
2. Power unit size and status. Costs are projected for a 500-MW new
power unit. Heat rate is 9 kBtu/kWh. New units are designed for
a 30-year life, 127,500 hours of operation.
3. Fuel type. Coal assumed for this study is bituminous—12 kBtu/lb,
12% ash, 3.5% sulfur (dry basis).
4. Particulate removal and disposal. A 99.5% efficient ESP has been
assumed. Cost of particulate removal and disposal is not included
in the economic evaluation.
5. S02 removal. Removal of 90% is specified as the base value.
6. Sludge disposal. Pond for the disposal of sludge from the lime-
stone slurry process is located 1 mile from power plant. Water
balance is based on closed-loop operation.
7. Capital charges. Regulated (profit and taxes included) economic
basis is used. Revenue requirement estimates utilize a base
value of 14.9% of fixed investment (10% cost of money).
8. System design. Design is assumed to be developed (not "first of
a kind"), no redundancy is included, only pumps are spared, and
an experienced design and construction team is assumed to be
utilized.
A summary of the revenue requirements for 7000 hours of operation
is presented in Table S-l.
xxii
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TABLE S-l. SUMMARY OF TOTAL ANNUAL REVENUE REQUIREMENTS
(Excluding credit for sale of abatement gypsum)
FGD system
Limestone slurry
Li me stone- gyps urn
Chiyoda
Dowa
Total
annual revenue
requirements, $
10,105,300
12,098,100
15,483,400
10,472,200
Mills/kWh
2.89
3.46
4.42
2.99
C/MBtu
heat input
32.08
38.41
49. 15
33.25
$/ton
coal burned
7.70
9.22
11.80
7.98
S/ton
sulfur
removed
281.64
337.18
431.17
291.62
$/ton gypsum
produced
_
50.21
77.88
52.53
Gypsum produced,
tons/yr
_
240,960
198,800
199,360
a. Basis
500-MW new coal-fired power unit.
3.5% sulfur in coal.
90% SC>2 removal.
7,000-hour/year operation.
Mid-1978 cost basis.
Onsite disposal of limestone sludge.
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The Dowa process has the lowest cost of the gypsum processes esti-
mated. However, the technology has not been fully developed for use on
coal-fired boilers. Therefore, limestone-gypsum process costs are used
as a basis for estimating production costs in the following sections.
Lower cost limestone-gypsum processes are currently being developed (1).
Potential Supply of Abatement Gypsum
Cost factors and premises developed in the base-case estimates were
applied to operating characteristics of each steam plant in the industry.
Operating characteristics were taken from Federal Power Commission (FPC)
data that had been supplied by the utilities. There were 187 plants
calculated to be out of compliance. FGD costs were calculated for both
the limestone scrubbing and the limestone-gypsum processes for each
plant. Based on the cost calculations, 116 plants are candidates to
install an FGD system. The remaining 71 plants are assumed to purchase
low-sulfur fuel to meet compliance. Three plants were located in the
West and are assumed to install the limestone slurry throwaway system.
The remaining 113 plants are subjects of the market analysis.
Each of these plants was assumed to install the limestone slurry
process unless revenue from gypsum sales could be predicted to offset or
exceed added costs of the gypsum process. Total first-year cost to
operate the limestone throwaway process was calculated at about $2G
(G = 1 billion) which includes depreciation and ponding costs. Over 25
Mtons of calcium solids would have to be discarded.
Differential costs between the limestone and limestone-gypsum
processes ranged from negative $13 to positive $20/ton. of gypsum.
Potential gypsum production is 27 Mtons, almost twice the projected 1978
consumption in the Eastern States. Fifteen power plants could control
S02 emissions by the gypsum process at a lower absolute cost than by the
throwaway process. These plants could produce a total of 863 ktons in
the first year. An additional 25 plants could meet compliance by
producing gypsum at incremental cost of up to $3/ton (the estimated cost
of mining crude gypsum). These 25 plants could produce 3.6 Mtons.
Negative or low incremental costs of the gypsum process were shown
to occur at new, small, power plants where annual gypsum production
volume is low. All negative costs were associated with relatively new
plants that would produce less than 100 ktons of gypsum annually.
Results of Market Model
A modified linear programing model was used to calculate revenue
from abatement gypsum sales to each steam plant. The model was based on
the premise that FGD systems are mutually exclusive and that both lime-
stone and limestone-gypsum systems will not be installed at the same
plant. Gypsum production will be either zero tons or the maximum to be
produced at compliance. Gypsum will only be produced and supplied when
revenue can be predicted to offset added production cost.
xxiv
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The market analysis was conducted and presented in a series of
scenarios with progressively more stringent marketing restrictions to
predict the number of plants that would choose the gypsum alternative-
Each scenario was developed in the same manner that a specific steam
plant might employ to determine the market potential for the individual
plant. Restrictions were developed to predict the steam plants which
could lower cost of compliance by producing and marketing abatement
gypsum if all plants were to enter the industry in 1978.
The analysis was conducted in such a manner that savings to the
gypsum users could be calculated along with lowered cost of compliance
to the utility industry. The final market solution predicted that 30
steam plants could lower cost of compliance by producing and marketing
gypsum; the locations are shown in Figure S-l. These 30 plants would"
serve a total of 93 demand points. The location of demand points is
shown in Figure S-2. Only one wallboard plant would purchase abatement
gypsum (partly because cement plants offer a higher price outlet).
Compliance cost would be reduced in the first year by $11M to the 30
power plants compared with use of limestone scrubbing. This amounts to
an average savings of over $350k/plant. In terms of total industry cost
of compliance, the savings by gypsum production would amount to less
than 1%. Savings to the gypsum industry are calculated to equal $1M.
Total gypsum production is 2.4 Mtons with an average production of 80
ktons/plant. The total is approximately 53% of the amount that could be
produced and sold (at $3/ton) with costs lower than limestone scrubbing.
Abatement gypsum would be purchased by 92 cement plants. Abatement
gypsum would replace 67% of the projected use of crude gypsum by cement
plants.- Cement plants were projected to import 1.1 Mtons. Production
from the 30 steam plants would replace 74% of the imported material used
in cement plants.
Use of gypsum-producing technology at the 30 power plants would
solve only 8.7% of the electric utility sulfur oxides compliance problem
and reduce the required ponding of calcium solids by 8.0%. Construction
of "across-the-fence" wallboard plants at new power plants might improve
the market potential.
The market model was also used to assess the feasibility of gypsum
production and marketing assuming that wallboard plants were the only
effective market outlets for abatement gypsum. Under this condition,
only nine utilities could reduce compliance costs by producing and
marketing abatement gypsum to the wallboard industry. These 9 plants
could produce and market a total of 608,000 tons of abatement gypsum on
an average of 67,500 tons/plant. Total reduction in compliance cost for
the 9 plants in comparison to the limestone throwaway system would
amount to $1.6M or an average of $184k/plant.
The reason that the wallboard market is so limited is that existing
plants^are built at the same location as the gypsum mine or at the point
of minimum water transportation costs. Cement plants, on the other
xxv
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;:
:
Figure S-l. The locations of steam plants that could lower cost of compliance by producing and marketing gypsum.
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Figure S-2. Location of demand points for byproduct gypsum produced by steam plants.
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hand, are not located at gypsum mines and a high percentage of the cost
of crude gypsum is transportation cost rather than product cost.
An analysis was conducted based on a $3/ton price reduction to
cement plants. Under this lower price assumption, 27 utilities would
still reduce compliance costs by producing and marketing abatement
gypsum. This compares with 30 utilities found under conditions pro-
jected for 1978. The reduction in abatement gypsum sold would amount to
365 ktons. Under the reduced price assumption, the major difference in
outcome of the analysis was that savings in compliance cost for power
companies was reduced from $11M to $6.2M.
CONCLUSIONS
1. Because of huge reserves, no major national interest would be
served by subsidizing abatement production to serve as a stock-
pile for later use.
2. Gypsum production and marketing offers a limited potential to the
utility industry to lower cost of compliance; only about 8% of
the electric utility compliance problem would be solved by this
method. Production cost relative to throwaway use of limestone
scrubbing is too great for large plants which contribute the
major share of S02 emissions. Incremental cost of producing
gypsum is greater than the estimated mining costs for natural
gypsum on approximately 85% of total possible abatement produc-
tion. Only about half of the gypsum that could be produced and
sold (at a price of $3) with costs lower than limestone scrubbing
was marketed.
3. Gypsum production and marketing appear to be a viable alternative
for relatively new, small plants (generally less than 200 MW)
where required S02 removal amounts to 20-30 ktons of sulfur
annually. These producers could more easily find a nearby market
(cement plant) where they could compete with gypsum shipped from
the mine or port of entry.
4. When viewed in a total program of byproduct production and
marketing, gypsum takes on added significance in that it is
particularly well suited to the segment of the industry with a
small annual volume of required sulfur removal.
5. Cement plants offer the greatest potential market outlet for
abatement gypsum; the wallboard industry would provide an ex-
tremely limited market. The demand at cement plants averages 25
ktons/plant and offers the possibility for about 30 steam plants
to locate a few local market outlets for abatement gypsum.
6. Abatement gypsum appears to offer fewer problems in the manu-
facture of cement than in wallboard because impurities are not as
critical.
xxviii
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7. Price reaction by gypsum producers cannot be predicted, but 27
steam plants would be predicted to continue to produce and
market abatement gypsum to the cement industry in the face of a
$3/ton price reduction.
8. Stability of the solution may be further ensured since such a
high proportion of abatement market is gained by replacing
imported gypsum.
9. Because of the low value of natural gypsum, production of abate-
ment gypsum has limited potential. Special marketing oppor-
tunities may develop where across-the-fence delivery is feasible
or where costs for sludge disposal from limestone scrubbing are
extreme.
10, Agricultural use of gypsum represents a minor part of the total
market. If forecasts of increasing soil sulfur deficiencies are
correct, agricultural use will be a potential growth market for
sulfur products, including gypsum.
In addition to the findings generated by this study and a companion
study (2), other specific accomplishments may be cited.
1. Specific supply and demand data bases for crude gypsum were
established and may be maintained or improved.
2. A computerized system for approximating rail rates was developed
in conjunction with the study series and is being maintained.
3. Operating characteristics at the boiler level were projected for
each fossil-fired power plant in the United States and placed in
a data base for future use.
4. A computer model was developed to test for compliance and to cal-
culate FGD costs for a number of alternative systems.
5. Procedures and models were established to calculate net revenue
from sales of byproducts from steam plants.
6. Support is being generated to maintain and improve on the work
developed to use the models to assist individual utilities in
their efforts to develop appropriate plans for compliance.
LIMITATIONS
The analysis was conducted under the assumption that abatement
gypsum is interchangeable with crude gypsum for use in wallboard and
cement. Both advantages and disadvantages are likely. Tests under
plant conditions, particularly in cement manufacture, need to be con-
ducted to quantify cost associated with the use of abatement gypsum.
xxix
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Further work to quantify the supply price of crude gypsum of producing
areas is needed. The use of estimated average costs for all regions
detracts from the accuracy of results but probably does not affect the
conclusions. In that regard, gypsum industry cost information is not
generally available; it is difficult for a researcher outside the
industry to develop the intimate knowledge of the industry required for
in-depth analysis. This study should serve to establish potential, but
specific studies need to be conducted for each potential producer to
more accurately determine actual cost and revenue opportunities.
RECOMMENDATIONS
For planning future growth in both the utility and gypsum industries,
the special situations where production of abatement gypsum has good
economic potential should be identified. This will require a cooperative
effort between specific companies.
The study suggests that production of abatement gypsum as a waste
product may be a viable option to disposal of sulfite sludge. Economic
and environmental considerations should be evaluated.
Cost models developed can be used to evaluate compliance alterna-
tives. This should be particularly helpful in planning for new power
plants and in evaluating the effect of changing regulations.
The results of this study and any refinements should be used by the
cement industry to evaluate potential supply of lower cost raw materials.
xxx
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FEASIBILITY OF PRODUCING AND MARKETING BYPRODUCT GYPSUM FROM
S02 EMISSION CONTROL AT FOSSIL-FUEL-FIRED POWER PLANTS
INTRODUCTION
The electrical utility industry in the United States faces many
difficult problems and decisions in implementing the Clean Air Act of
1967 as amended in 1970 with respect to S02 emissions. Control strat-
egies, such as dispersion by the use of tall stacks and reduced pro-
duction during periods of weather stagnation, have been eliminated by
recent court decisions. Even so, pressure continues for electric
utilities to expand production. The U.S. Department of Interior has
projected that net electrical generation by fossil-fired power plants
will increase from 1310 GkWh (G = 1 billion) in 1971 to 1950 GkWh in
1980 (3). Utilities are expected to meet these increased power demands
and to assure that emissions of sulfur oxides comply with existing air
quality laws and regulations.
Current and long-term natural gas and crude oil shortages limit
their use. Also low-sulfur coal is not available in adequate supplies
near the point of use to meet existing needs. The remaining currently
viable option, if fossil fuels are to be used, is directed to some form
of emission control by desulfurization (scrubbing) of flue gases.
In recognition of the complex problems faced by utilities, the U.S.
Environmental Protection Agency (EPA) has begun a broad-scale research
effort with the Tennessee Valley Authority (TVA) to evaluate alternative
flue gas desulfurization (FGD) systems.
Much of the early research work on FGD systems centered around the
lime and limestone slurry processes. These systems are the most fully
developed and in general are the lowest cost processes for coal-fired
units; most installed FGD systems are lime or limestone systems. The
end product is a thixotropic sludge that presents disposal problems.
In 1975, EPA projected that FGD control systems could be installed on 90
kMW (k = 1 thousand) or about 35% of the total estimated coal-fired
utility generating capacity by 1980. The installations would result in
an annual production of 131 Mtons (M = 1 million) of throwaway sludge if
the limestone slurry process were used (3). A more recent estimate (4)
indicates that 109 FGD systems with an equivalent rating to over 55 kMW
are either operational, under construction, or planned. Application of
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stack gas scrubbing by U.S. utilities now totals about 10 kMW of capacity.
Lime-limestone throwaway systems are used on over 90% of this capacity.
The limestone slurry process is wasteful of large quantities of
sulfur, a valuable economic resource. To the extent that SC>2 emissions
can be economically recovered and used, society would be the net bene-
ficiary. A TVA study (5) indicates total S02 emissions equivalent to 24
Mtons of sulfur are amenable to recovery. This is about twice the
current annual use of sulfur in the United States. These factors are
particularly important when it is recognized that reserves of natural
sulfur in the United States are limited. Pearse (6) projects depletion
of U.S. reserves by the year 2000 if mining continues at current rates.
Other studies, while tending to confirm the long-run outlook for sulfur,
point to possible or even probable oversupplies of sulfur in the near
future. Farmer (7), for example, reports "world oversupply of sulfur is
a virtual certainty for at least another decade . . . introduction of
abatement sulfur (from refineries, smelters, and utilities) into domestic
markets will be difficult to accomplish without causing chaos in the
market." However, he suggests that by 1990 abatement sulfur will need
to be captured in usable form.
The current sludge disposal procedure generally is to provide
sludge-holding ponds. Disposal, depending on the unique circumstances
of a particular utility, can be quite expensive. Disposal sites may
have to be located some distance from scrubbing facilities. Also, it
may be necessary to line disposal ponds with an impermeable material to
prevent leakage. In some cases sludge has been chemically treated to
produce a solid material with greater strength and lower permeability.
Because sludge disposal poses potential problems of aesthetics, land
use, and pollution of ground water, research is needed on long-range
solutions to these potential problems including the associated costs.
Alternatives to the throwaway FGD systems are being developed that
can be used to comply with regulations, but feasible application of
these systems is complex, involving both technology and markets. Pro-
duction and sale of abatement products marketing is a possible solution,
but questions arise concerning status of technology, cost of processes,
available markets, and the price effect of introducing abatement products
into existing markets. Solutions to minimizing cost of compliance will
be found at individual plant levels. Action taken by the utility has a
major influence on options remaining for other utilities. As spatial
market considerations come into play, the production and sale of an
abatement product by one utility may effectively eliminate market
opportunities for other potential abatement producers of the same product.
One alternative to the throwaway FGD systems is one which produces
abatement gypsum. In Japan several such processes have been developed
and are in use in oil-fired plants. The gypsum produced is currently
being used in the wallboard and cement industries in Japan.
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It is important to evaluate abatement gypsum FGD systems under
existing conditions in the United States. The product has immediate
uses that may contribute toward providing alternatives to throwaway
systems and also has a long-run potential as a way to stockpile sulfur
for future needs. In the United States, a demonstration gypsum-producing
FGD system on a coal-fired facility is being operated by the Gulf Power
Company of Pensacola, Florida, in cooperation with EPA; the product has
been used successfully in tests at a commercial wallboard plant.
Today's market for gypsum totals nearly 20 Mtons annually, of which
about one-third is imported. Gypsum markets represent a potential to
use large quantities of abatement product rather than resorting to
conventional throwaway systems. Gypsum may be stockpiled easily with
minimal environmental problems and may be utilized later as a source of
sulfur if needed. One commercial venture to produce elemental sulfur
from gypsum was carried to production stage in 1968. The plant was
based on a process requiring 6 tons of gypsum to produce 1 ton of ele-
mental sulfur. At gypsum prices of $0.50/ton, the production cost of
sulfur was reported between $27.00 and $40.00/long ton of elemental
sulfur (8).
OBJECTIVES OF THE STUDY
The purpose of this study is to determine and evaluate the economic
potential of production and marketing of abatement gypsum by fossil-
fired utilities as a method to meet air quality regulations. To accom-
plish this evaluation it is necessary to provide a comprehensive assess-
ment of costs of abatement systems as well as markets in which the
product might be used. The study is limited to an evaluation of poten-
tial use in existing markets. The wallboard products manufacturing
industry is the dominant user of crude gypsum. This market potential is
given major attention, but consideration is also given to potential uses
in other markets.
The major objectives are:
1. To identify basic conditions of supply and demand for the gypsum
industry.
a. Determine supply locations of crude gypsum.
b. Estimate supply prices of crude gypsum.
c. Estimate demand for gypsum by specific location, quantity,
and price.
2. To characterize demand and projected growth in demand by major
markets.
3. To identify potential problems in market entry and suggest market
strategies.
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4. To evaluate costs for several different gypsum-producing FGD
systems and to develop cost estimates for representative systems.
5. To further develop and improve an analytical model for conducting
abatement product marketing investigations.
6. To apply the model to determine optimum strategies for the
industry on a plant-by-plant basis and in total.
7. To suggest further research needs.
BACKGROUND OF STUDY
TVA has been involved in research concerning S02 and other emissions
from fossil-fired utilities for many years. Since the late 1960's, TVA
has conducted research of a broad scope in cooperation with EPA; results
of a number of studies have been published in the past few years. In
1975 TVA published results of a detailed cost study (9) in cooperation
with EPA. This effort was a major achievement; it was the first detailed
comparative evaluation and cost estimation of currently available
approaches to FGD. Engineering cost estimates were developed for both
new and existing facilities for 200-, 500-, and 1000-MW-capacity plants
using both oil and coal at varying levels of sulfur content. At the
same time methods for scaling costs for other size operations were
developed. The processes evaluated were (1) lime-limestone with pond
disposal of solids, (2) magnesia slurry scrubbing with regeneration to
produce sulfuric acid, (3) sodium sulfite/bisulfite scrubbing with S02
reduction to sulfur, and (4) catalytic oxidation to produce 80% sulfuric
acid.
The next logical step was to develop procedures to evaluate market
potentials and market impacts for products that might be produced by the
utility industry on a broad basis as well as an individual plant basis.
TVA undertook the task of developing computer procedures from which
costs at each plant could be calculated and markets evaluated. The
objective was the development of models and procedures for continuing
use. The first effort in this direction was an economic evaluation of
the potential for TVA to produce and market sulfuric acid at each of its
fossil-fired plants (10). A later report evaluated the impact on the
sulfuric acid market if all utilities east of the Mississippi River were
to attempt to produce and market abatement acid. This study showed the
equilibrium market solution when both the sulfuric acid and utility
industry operated to minimize the cost of sulfuric acid to the industry
(11). The study is being updated to project 1978 operating conditions
of the utility industry and is being expanded to include the continental
United States.
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The success experienced in Japan in producing and marketing abate-
ment gypsum for use in wallboard manufacture caused an interest in
evaluating gypsum-producing systems for possible use in the United
States. In 1974 a preliminary feasibility report of abatement gypsum
production in the United States was completed. The findings indicated
that "production of wallboard-quality byproduct gypsum from 862 removal
systems may be an economically attractive route to waste solids disposal."
A more detailed study was recommended (12). The current study results
from this earlier interest and the preliminary findings.
METHODS AND PROCEDURES
The essential data management system contains four elements (1) the
ability to calculate abatement gypsum production costs at individual
plants, (2) gypsum market information, specifically supply locations,
supply prices, demand points, and estimates of quantity demand at each
point, (3) the ability to generate rail transportation cost, and (4) a
linear programing model to determine least-cost distribution of crude
and abatement gypsum to demand points.
The study is based on projected 1978 conditions. Abatement gypsum
production cost estimates and scale factors are developed following
procedures and assumptions made in the previous TVA cost study (9).
It is assumed that compliance at each plant will be achieved by
1978 with the following alternative strategies (1) using high-sulfur
fuels and building limestone-scrubbing facilities including sludge
disposal ponds, (2) using high-sulfur fuels and building scrubbing
facilities to manufacture byproduct gypsum of wallboard quality, (3)
making necessary plant modifications and changing to low-sulfur (clean)
fuel, and/or (4) following a mixed strategy where clean fuel is utilized
in some boilers and an FGD system is installed on other boilers at the
same plant. The clean fuel alternative provides a cost screen and is
held constant.
Selection of the gypsum-producing alternative depends on the cost
difference between the limestone-gypsum and the limestone-scrubbing
methods. If net revenue from sale of abatement gypsum equals or exceeds
the cost difference, then gypsum production presents an economic alter-
native. Potential markets are determined by comparing the delivered
prices of crude gypsum and abatement gypsum at specific demand points by
linear programing procedures.
For purposes of this study, it is assumed that the gypsum-scrubbing
process used in the study will effectively remove S02 emissions from
coal-fired power plants without technological problems. It is further
assumed that the resulting abatement gypsum will substitute for crude
gypsum in each of its major uses. The basis for these assumptions is
covered in a later section of the report.
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In the short run, markets for gypsum will be dependent upon the
demand for products at existing wallboard fabrication and cement plants.
In the long run, optimum plant locations may change as a result of
changes in demand for gypsum products and available supplies of abate-
ment gypsum.
It is assumed throughout the study that utilities will only act as
suppliers of abatement gypsum to the existing gypsum products industry.
No attempt is made to evaluate the economic feasibility of the production
and sale of prefabricated gypsum products by the utility industry or of
relocation of wallboard or cement industries near power plants.
ORGANIZATION OF THE STUDY
The study is being conducted under contractual arrangements between
TVA and EPA, is based on data projected to 1978, and covers the con-
tinental United States. The electric utility industry is the primary
audience to which this study is directed, with the potential of the
utility industry to economically produce abatement gypsum and replace
crude gypsum being the focal point of the analysis.
The analysis is developed in four steps. The first deals with the
nature of supply and demand for crude gypsum. Gypsum reserves, mine
locations, mining cost, industry structure, entry conditions, and other
general information relating to the overall gypsum industry are presented.
Characteristics of major markets are defined, estimates of growth in
markets are made, and specific demand and supply points are determined.
The second step compares gypsum production costs at each utility with
the limestone slurry throwaway system based on data from the Federal
Power Commission (FPC) (Form 67)—cost differences between the processes
are used to determine the supply quantity of abatement gypsum and price
at each steam plant. The third step evaluates the market for abatement
gypsum in competition with crude gypsum. A linear programing transpor-
tation model is the basic tool of analysis to determine the potential
net revenue from abatement gypsum production and sale at each steam
plant. In the fourth step conclusions and recommendations for further
research were developed.
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THE GYPSUM INDUSTRY
An overview of the gypsum industry is provided with emphasis on
crude gypsum supply with which abatement gypsum supply must compete.
Gypsum is defined and major uses are identified. The history of the
industry is traced to the present. Supply is addressed from the point
of view of existing reserves, mine locations, mining costs, and domestic
and foreign production for markets in the United States. In addition,
industry characteristics, structure, integration, concentration, entry
conditions, and prices are discussed.
THE MINERAL GYPSUM
Gypsum is a naturally occurring nonmetallic mineral found in huge
deposits in many parts of the world. Deposits are usually associated
with large salt deposits and are formed by evaporation processes in
orderly stratigraphic beds with limestone and salt. Gypsum is the
dihydrate form of calcium sulfate (CaSO^'Z^O) and anhydrite is the
anhydrous form (CaSO^). Usually gypsum and anhydrite are found in close
association, but anhydrite is of limited economic importance.
Gypsum deposits contain impurities usually in the form of anhydrite,
limestone, dolomite, or shale and clay. Minimum purity of 70% CaSO, '2^0
is required for classification as gypsum. Gypsum produced for calcining
is normally 85% or greater. For agricultural purposes purity may be in
the range of 50-70% CaSO^^H^O. In this percentage range the product is
known as gypsite. Much of the gypsum used for agriculture in western
states is of the gypsite quality.
The major economic importance of gypsum is derived from its unique
property of readily giving up water of crystallization with application
of only moderate amounts of heat. The process, known as calcining,
involves heating crude gypsum at about 350 F for over an hour (13). The
calcined product is called "plaster of Paris" (CaSO^-1/2^0) which when
mixed with water returns to the dihydrate form that is then manufactured
into plasters for construction and industrial use and into wallboard and
other prefabricated gypsum products for use in construction. Today, about
70% of the gypsum used in the United States is calcined. The remaining
30% is used in its natural state (uncalcined), primarily in the cement
industry as a set retarder but also in a variety of agricultural uses
(14).
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HISTORY
Gypsum has been in use since the earliest recorded history. It was
first used in artistic work by the Chinese, Assyrians, and Greeks. In
the 18th century, gypsum was used as a soil conditioner in Western
Europe. Gypsum was first discovered in the United States in New York
State in 1792. By 1875 it had been discovered in six additional states
and was used for agricultural purposes.
In 1885 a commercial method of retarding the setting of gypsum
plaster was developed. This method permitted the use of plaster in
construction (13). Then in the early 1900fs the "sackett" and "folded
edge" patents were announced. These patents made possible the industry's
first attempts at prefabrication and have been the basis on which much
of the industry has developed (14).
Gypsum production first reached a million tons in the United States
in 1903. By the mid-1920's production reached 5.6 Mtons, of which 4 Mtons
was calcined mostly for use in building plasters. Production declined
sharply during the depression, and it was 1946 before production again
climbed to 5 Mtons. This increased production was primarily to meet
wartime needs for prefabricated products for temporary military buildings.
The industry entered a period of rapid growth shortly after World
War II to meet the demand for new housing. In 1947 total value of
gypsum products sold was $127.5M; by 1967 the total value of sales had
increased to $387.7M; and the value of sales in 1974 exceeded $630M.
During the same period the gypsum industry also went through a major
change in terms of composition of sales. Immediately, prior to World War
II the value of shipments of gypsum products was about evenly divided
between building lath and plaster, each with about 33% of the market;
sales of prefabricated wallboard products amounted to 23% of value of
sales. During the war the dry-wall product was used extensively and
became the major user of gypsum. That trend continued after the war,
and the use of wallboard products has continued to expand. By 1974
sales of prefabricated dry-wall products were 86% of the value of sales
while lath and plaster declined to 2 and 4% respectively. Uncalcined
products made up 6% of the total value of gypsum sales.
GYPSUM RESERVES
In the preprint from Bulletin 667 (13), the U.S. Bureau of Mines
provides the following information concerning reserves of gypsum.
Domestic and foreign resources and reserves of
gypsum are adequate for any foreseeable period of
time. World reserves are conservatively estimated
at 2 billion tons, of which the United States has
350 million tons. Canada has tremendous gypsum
resources in Nova Scotia, New Brunswick, Ontario,
-------
Manitoba, British Columbia, and Newfoundland.
Reserves are estimated at 410 million tons, but
Nova Scotia alone has 600 square miles of
gypsiferous rocks.
The reserves of gypsum in the Paris Basin in
France are considered to be almost unlimited.
The gypsum beds extend over 8,000 square kilo-
meters with thicknesses up to 55 meters.
Most of the countries bordering the Mediter-
ranean have large to very large gypsum deposits.
In the United States, gypsum resources are cen-
tered near three main areas, the Great Lakes
area, California, and the Texas-Oklahoma area.
In Michigan, a continuous belt of gypsum-
bearing rocks underlies parts of Kent, losco,
Mackinac, Ionia, Saginaw, and Eaton Counties.
These resources of gypsum are practically
inexhaustible.
Texas has very extensive gypsum resources. The
largest area of gypsum deposits extends for 200
miles from Sweetwater on into Oklahoma, 20 to
50 miles wide and up to 20 feet thick. In
Culberson County, gypsum outcrops over 600
square miles, 50 miles long, 15 miles wide, and
up to 60 feet thick.
The Texas deposits continue into Oklahoma,
where enormous gypsum resources occur. The
gypsum deposits underlie most of Beckham,
Greer, Jackson, and Harmon Counties. Other
large deposits occur along the Cimarron River
and in the west-central part of the state.
In Webster County, Iowa, an area of 70 square
miles is underlain by gypsum beds up to 30 feet
thick. The area is 13 miles long and 5 miles
wide.
Many deposits of gypsum and gypsite occur in
California. The total resources are very
large.
Other states have large gypsum resources. In
southeastern Arizona, there are two gypsum
beds, each 50 feet thick. In Colorado, there
are several gypsum beds up to 30 feet thick.
There are large deposits in Indiana. Gypsum
-------
beds in Kansas are said to be inexhaustible.
Montana has several gypsum beds up to 30 feet
thick. In Nevada, gypsum beds range up to 130
feet thick. In New Mexico, there are gypsum beds
up to 100 feet thick, and white sand dunes of
gypsum cover an area of 270 square miles.
Enormous beds of gypsum up to 200 feet thick are
found in Utah.
Gypsum reserves are extensive both in the world and the United
States; however, with the exception of one gypsum-producing area in
southwest Virginia no economic reserves are located in the south-
eastern portions of the United States.
Data are not available concerning ownership of reserves by com-
panies, but distinct differences in composition of the industry in
western reserves compared to reserves in the East lead to the assump-
tion that economic reserves in the East are under the control of
integrated companies. This may partially be explained by limited
noncalcined markets for gypsum in the East. The nonintegrated mine
operator would be dependent upon the cement industry for his market
outlet; the cement industry would offer limited local demand.
Transportation costs are critical to the industry. Both crude
gypsum and manufactured gypsum products are bulky and have relatively
low values. Freight costs to move gypsum product to distant markets
soon become greater than product value. Consequently, mine and plant
locations must be established in close proximity to markets served.
Maps showing gypsum-producing regions, mines, and plant locations are
shown in Figures 1-3. Calcining plants serving interior markets are
located in close proximity to mines—many times on the same property.
Coastal markets where gypsum is not available are served by calcining
plants located at seaport locations that use crude gypsum imported
primarily from Canada and Mexico.
GYPSUM MINING
Gypsum is mined from both open-pit and underground mining opera-
tions. Open-pit mining is done by use of conventional methods and
highly mechanized equipment. Overburden is removed and shovels are
used to load the rock. Production is usually in the range of 500 to
1500 tons each day ( 15). Underground mining is accomplished by room
and pillar methods. Mining costs are low. According to Appleyard
(15), many operating deposits in 1973 mined gypsum and delivered
(onsite) to mill for a cost ranging between $0.60 and $3.00/ton not
including depreciation.
Mining costs are most directly influenced by the amount of over-
burden that must be removed, the thickness, and the consistency of the
deposit. Normally, no beneficiation is performed after mining; therefore,
10
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Figure 1. Location of gypsum-producing districts in North America (15)
]
-------
!
Figure 2. Location of domestic gypsum mines, 1975 (Mineral Industry Surveys) (16).
-------
'
Figure 3. Location of domestic calcining plants, 1975 (Mineral Industry Surveys) (16)
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overburden, as well as impurities within the deposit, must be carefully
removed before shipping or milling to maintain the desired purity.
After mining the product is milled, which for the most part consists of
grinding and screening to size specifications for intended use.
Mining of gypsite in the Western States for agricultural use is the
simplest operation. The deposits have very little overburden which is
simply scraped away. The same scrapers are used to remove gypsite in
thin layers. It is then crushed, screened, delivered, and bulk spread (17)
Domestic mining cost data are not available from published sources;
however, some indicators of cost are available. Energy costs per ton in
1973 were $0.17/ton of gypsum mined according to a survey conducted by
the Bureau of Mines (18). In 1968, according to information prepared by
the Bureau of Mines, the average output was 10,500 tons per employee
(17). More complete information on mining costs in Canada is available
from a 1974 publication of the Ministry of Industry, Trade and Commerce
(19). This information is presented in Table 1 and compiled on a tonnage
basis in Table 2. The Canadian information is generally comparable to
that for mining costs in the United States. The summation of average
wage cost, energy cost, and cost of supplies and materials should repre-
sent a good estimate of the average variable cost per ton for mining
gypsum. In 1974 that figure in Canada was $1.42/ton. This figure
should provide a good estimate of the average variable cost for gypsum
mined in the more economical producing areas of the United States.
Appleyard (15) discussed characteristics of the major producing
areas of North America in some detail. From his discussion it is
apparent that mining costs vary both within and between producing
regions. Differences in cost, however, are not great enough among
regions to justify cost of ground transportation. For example, crude
gypsum is imported from southeastern Canada by water into lower New York
State although active deposits are located in the western edge of the
state.
Domestic gypsum production is centered in five states: California,
Iowa, Michigan, Oklahoma, and Texas. These five states accounted for
approximately 50% of total U.S. production (13). Mine production is
quite variable, ranging from less than 20 ktons to 750 ktons each year.
The Bureau of Mines maintains data on all mines that report an annual
production in excess of 20 ktons; in 1974, 75 mines were reported.
Total output was 11,999 ktons or an average of about 160 ktons each
mine. Ten of the 75 produced 42% of total production in the United
States or over 5 Mtons for an average of 0.5 Mtons each.
These data suggest that significant differences in minimum economic
sizes of mines exist between eastern and western deposits and, of
course, between underground and open-pit mines. In the Western States
mines with an annual output of 20 ktons apparently compete effectively
with mines many times that size. In the East this is not the case.
14
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TABLE 1. GYPSUM MINING COSTS IN CANADA - 1970-743
Cost, k$
No, workers
No. Gypsum sold, Produc- Adminis-
Year
1970
1971
1972
1973
1974
firms
13
10
10
10
10
ktons
6,319
6,702
8,099
8,389
7,967
tion
563
500
567
575
577
t rat ion
108
103
103
101
94
Total
671
603
670
676
671
Wages
Produc-
tion
3,401
3,324
4,280
4,508
4,861
Adminis-
tration
881
886
913
910
992
Total
4,282
4,210
5,193
5,418
5,853
Energy
721
814
874
986
1,101
Supplies & Value,
materials
2,728
2,718
3,521
3,341
4,258
f .o.b.
14,199
15,083
19,336
21,067
22,437
a. Ministry of
Industry,
Trade, and
Commerce.
Gypsum
Mines, 1974
. In:
Statistics
Canada ,
Catalogue
26-221
Annual, Tables 1, 2, and 11.
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TABLE 2. GYPSUM MINING COSTS PER TON IN CANADA - 1970-74a
Tons/
Tons/
production administra-
Year
1970
1971
1972
1973
1974
worker
11,224
13,404
14,284
14,590
13,802
a. Ministry of
tion
58,
65,
78,
83,
84,
Industry,
worker
509
068
630
059
723
Trade,
Tons/ Production
worker
9,417
11,114
12,088
12,409
11,869
and Commerce
worker
0.54
0.50
0.53
0.54
0.61
Gypsum
Cost/ton, $
Administra-
tion worker
0.13
0.13
0.11
0.11
0.13
Mines, 1974.
Average
Worker
0.67
0.63
0.64
0.65
0.74
Energy
0.11
0.12
0.11
0.12
0.14
Supply &
material
0.44
0.41
0.44
0.40
0.54
variable
Value cost , $
2.25
2.25
2.39
2.51
2.82
1.22
1.16
1.19
1.31
1.42
In: Statistics Canada, Catalogue 26-221
Annual, Table 1.
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INDUSTRY CHARACTERISTICS
Functions of the gypsum industry include mining and distribution of
crude gypsum for direct uncalcined uses and for calcining for manufacture
and distribution of gypsum products for construction and industrial
uses. Total value of industry sales exceeded $630M in 1973—a record
year for the industry. Calcined products made up 95% of total value of
sales and prefabricated products accounted for 94% of value of sales for
calcined products; value of sales includes value added in the manufacture
of prefabricated products. The agriculture and the cement industries
were major users of uncalcined materials accounting for 1 and 4%,
respectively, of value of sales. In 1973, 20,636 ktons of crude gypsum
was consumed in the United States. Production in the United States
amounted to 13,558 ktons and 7,661 ktons was imported. Uses were dis-
tributed among products as follows: calcined materials, 73%; agriculture,
7%; and cement, 20% (20).
Seasonal Distribution Patterns
Since the gypsum industry is so closely dependent on the construc-
tion industry, it could be assumed the industry would be characterized
by a highly seasonal distribution pattern. This is not the case based
on quarterly data during 1970-74. When taken as a percentage of total
annual sales of board products, distribution is almost equally divided
among the four quarters. There is a slight tendency for first-quarter
distribution to be slightly below 25% and the remaining three quarters
to be slightly above 25%. Percentage distribution by quarters is shown
in Table 3.
TABLE 3. SEASONAL DISTRIBUTION OF WALLBOARD PRODUCTS-
SALES BY QUARTERS OF THE YEARS - 1970-743
% annual total sales
Annual quarters
January-March
April-June
July-September
October-December
1970
22
26
26
26
1971
21
25
27
27
1972
23
25
26
26
1973
24
25
26
25
1974
27
26
26
21
a. U.S. Bureau of Mines. Minerals Yearbook.
17
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The data indicate that utilities could plan to distribute abatement
gypsum on a regularly scheduled basis throughout the year. Storage
facilities can be geared accordingly with flexibility to provide for
outages and possible added seasonal demands if agriculture becomes a
significant market.
Annual requirements are subject to wide fluctuations (see Table 4).
Industry requirements, while showing an upward trend, have fluctuated by
as much as 2 Mtons in a single year. From 1970 through 1973 gypsum use
increased over 6 Mtons but by 1975 had decreased by 5.5 Mtons to 15,190 ktons
This was just a little more than 1 Mton above average use in the sixties.
Through September 1976,use was 1 Mton greater than the same time period
in 1975.
TABLE 4. GYPSUM USE, PRODUCTION, AND VALUE - 1955-75'
Domestic use,
Year ktons
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
13,994
13,676
12,720
13,210
15,200
14,008
13,692
14,514
15,155
15,879
16,092
14,778
14,132
15,625
15,818
14,334
16,914
19,412
20,636
18,693
15,190
Domestic
production,
ktons
10,684
10,316
9,195
9,600
10,900
9,825
9,500
9,969
10,388
10,684
10,033
9,647
9,393
10,018
9,905
9,436
10,418
12,328
13,558
11,999
9,251
Average
value
f . o.b . ,
$/ton
3.18
3.31
3.25
3.38
3.59
3.63
3.68
3.65
3.67
3.64
3.73
3.70
3.66
3.67
3.88
3.72
3.75
3.93
4.18
4.41
4.80
Imports ,
ktons
3,966
4,336
4,334
4,049
6,135
5,301
4,967
5,421
5,490
6,258
5,911
5,479
4,563
5,474
5,858
6,128
6,094
7,718
7,661
7,424
5,448
Average
value
f . o.b . ,
$/ton
1.58
1.80
1.75
1.70
1.94
1.70
1.82
1.94
1.98
2.13
2.37
2.37
2.87
2.08
2.12
2.24
2.21
2.38
2.30
2.37
2.94
a- U.S. Bureau of Mines. Minerals Yearbook.
18
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Integration
In terms of value of product sold, the industry is highly inte-
grated from mining through calcining and sale of manufactured products.
In 1975, 13 companies operated 74 calcining plants in 29 states. Seven
firms were multiplant firms operating from 2-23 plants. Six firms
operated one plant each. Of the 13 firms, all but 2 operated company-
owned mines that supplied gypsum to calcining plants and also sold
gypsum for other uses.
In addition to being highly integrated from mining through manu-
facture of gypsum products, the large firms manufacture the paper stock
required for prefabricated products and are also diversified to provide
a variety of building and construction needs including cement and con-
crete products.
In general, the industry is not integrated forward. Wallboard
products are sold to independent building supply dealers or building
contractors. In most cases wallboard manufacturing plants have limited
final product storage, but warehouses may be located in distribution
areas. Also "speciality" dealers or wallboard brokers are important
distributors of wallboard—especially in the California market during
its period of rapid expansion in the sixties (21). Because of trans-
portation costs, plant sizes must be geared to limited distribution
areas. Plant locations shown in Figure 3 tend to demonstrate this.
When the mining sector of the industry is viewed separately,
slightly different characteristics are observed. Almost all of the
gypsum used in calcining operations is mined by integrated companies.
These companies also supplied a large percentage of the uncalcined
gypsum used in the agricultural and cement industries from both domestic
and imported services. As indicated earlier, the Bureau of Mines reports
annual production data from all mines with an annual production of 20
ktons or more. The number reported varies each year but ranges around
70 mines (see Table 5).
Except for one mine in Michigan, there are no nonintegrated mining
operations east of the Mississippi River. Nonintegrated mining opera-
tions are in almost all cases small, one-mine operations. Output from
these mines is marketed for agricultural and cement uses and geared to
local demand. Since the Bureau of Mines reports data for mines with
production exceeding 20 ktons annually, it is assumed that variability
in number of single-mine operations actually is not as great as indicated
in Table 5, but that variability in annual mine output is great. It is
assumed that mine numbers are more constant than indicated but that
production drops below 20 ktons frequently as local demand for cement
and agricultural use varies.
19
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TABLE 5. CRUDE GYPSUM MINE NUMBERS, CALCINING PLANT NUMBERS,
AND OWNERSHIP PATTERNS - 1970-753
1970 1972 1973 1974 1975
Number of mines 69 65 69 75 71
Number of plants 76 76 77 77 74
Multiplant firms , 78787
Plants operated 69 70 70 72 68
Mines operated15 34 36 36 36 36
Single-plant firms 55656
Mines operated 43434
Mining firms only
Number of firms and mines 31 26 29 36 31
a. U.S. Bureau of Mines. Mineral Industry Surveys.
b. Plants operated by multiplant firms and domestic mines
operated by multiplant firms.
Although a relatively large number of companies is involved in
gypsum mining, the history of the industry is that almost all gypsum
moving into calcining plants is from integrated operations. In 1972
Appleyard reported 11 calcining firms in operation. He further stated
that the 11 firms owned and controlled their own gypsum mines.
Fertilizer manufacturing operations are also becoming important
suppliers of byproduct gypsum for agricultural uses replacing crude
gypsum or gypsite. In 1974 three firms in California distributed 463
ktons at a reported value of $4.3M. Although data are not available, it
is known that byproduct gypsum from phosphatic fertilizer manufacturing
operations in Florida and North Carolina is becoming increasingly impor-
tant in supplying agricultural markets in the Southeast.
Concentration
The industry is also highly concentrated. From 1947-72 the leading
four firms have accounted for about 80% of value of industry shipments
in every year. (In 1954 the four-firm ratio rose to 90% but then declined
to an 80% ratio where it has remained.) The leading eight firms have
consistently accounted for over 90% of the market (22). Total number of
firms involved in the industry has ranged from 39 to 49 since 1970.
Thirteen firms have manufactured wallboard and other products.
20
-------
Firm growth during the period has taken place by internal expansion,
by merger, and by acquisition. A number of acquisitions in the sixties
afforded entry into new market areas for the acquiring company. Almost
every annual issue of the Bureau of Mines Minerals Yearbook reports
plant expansions and new plant openings. In fact, plant capacity increased
by 41%—from 8,388 Mft2 of 1/2-inch wallboard in 1960 to 11,882 Mft2 in
1968 (21). Since 1970 only one new plant has opened. Industry information
indicates three plants were closed in 1975; however, that information is
not reflected in currently published Bureau of Mines data.
Product Differentiation
Gypsum products are sold under brand names, but the products must
be interchangeable and tailored to meet very specific construction uses.
Buyers of the products are primarily building contractors who are
technically well informed. Because the products are homogeneous among
companies, buyers usually do not differentiate among suppliers. To
increase sales and market shares, firms provide added services, tech-
nical expertise, and training. The Gypsum Association actively works to
stimulate overall sales of gypsum products and to find new opportunities
for use of gypsum products.
Entry Conditions
Bain (23) included gypsum products in his study "Economics of
Scale, Concentration, and Condition of Entry in Twenty Manufacturing
Industries." He lists three major factors affecting condition of entry
to an industry, (1) economies of scale, (2) proportion of market required
for minimum economic-size firm and plant, and (3) absolute cost of entry.
His findings with regard to gypsum products were that minimal
efficient plant size was 2.3-3.0% of the national market. He found
evidence of "small" economies of multiplant operations. Optimal firm
size was found to represent 27-33% of the national industry capacity.
He suggests that the optimal-size firm in the gypsum products industry
would have about 10 plants. (Present distribution of the number of
plants is shown in Table 5.) Regional market share of a minimal efficient-
size plant must be 10% or greater. In terms of absolute costs total
capital requirements for minimal efficient-size plant were $5-6M in
1951. Conversation with equipment suppliers indicates that figure has
now risen to $12-15M exclusive of land costs.
Even though Bain's work was published in 1954, much of it is rele-
vant today and should be seriously considered by potential entrants to
the industry. Market share requirements for minimal plant size are
probably at least as great or greater today. The percent of national
market, other than a measure, is largely meaningless since prefabricated
products must be sold in regional markets. The capacity of existing
plants has been an elusive figure to find on a plant-by-plant basis. As
indicated earlier, the industry went through a period of rapid expansion
21
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in the sixties. Available information from Minerals Yearbook indicates
that several plants were built to a rated capacity of about 180-200 Mft2
1/2-inch wallboard equivalent. These data translate into a market for
about 185 ktons of gypsum per plant. Some were larger, but no evidence
of smaller plants was found.
In this study an attempt has been made to differentiate industry
characteristics between the mining and calcining sectors and further
between eastern and western segments. Integration has apparently been a
requisite for success in the gypsum products industry. Data from the
Bureau of Mines indicate only two firms involved in calcining are not
integrated. A knowledgeable industry participant (24) indicates that in
1972 all calcining firms controlled and operated their own gypsum mines.
The two supposedly nonintegrated firms were in operation in 1972. The
nature of gypsum deposits, the ability to handle impurities, and perhaps
different specifications existing for different companies would all work
together to make it extremely difficult to develop a viable market for
crude gypsum. To the extent that integration is required to achieve
minimal efficient size in the product industry, the absolute costs of
entry are increased by the amount necessary to gain control of adequate
reserves and open and begin operating a mine.
In western areas substantial markets exist for both cement and
agricultural uses. Reserves also appear to be more widely distributed
and less subject to existing industry control and mines less expensive
to open. Minimum economic size of a mine appears to be perhaps as low
as 20-30 ktons annually based on the number of small mines in operation.
Using Bain's terminology, entry barriers into mining would be classified
as relatively low. Evidence is particularly lacking to show substantial
economies in multiplant firms in the western areas. Thirteen firms
operated calcining plants in 1975. Six of these firms had single-plant
operations and five were located in the West. Further, the most recent
plant opening was accomplished by a single-plant firm expanding to
operate a second plant in a new location. All single-plant firms used
domestic gypsum and in all probability had a high degree of control over
the supply of crude gypsum.
In the area east of the Mississippi, conditions of entry appear to
be somewhat different. In the eastern and coastal areas, calcining
plants are located at seaports. These plants are owned by the large
integrated multiplant firms that also may own shipping lines or arrange
3-5 year contracts to transport crude gypsum from company-owned mines in
Canada or other import sources. Ships have cargo capacities of up to 30
ktons. The Canadian mines, the source of over 75% of total imports in
the United States, are located in Nova Scotia, New Brunswick, and
Newfoundland. In addition, small amounts of gypsum are supplied to
cement plants in the northwest portion of the United States from a mine
near Windermere, British Columbia. Mines in the Atlantic provinces are
located from 6-30 miles from seaport locations (16).
22
-------
In these areas absolute costs of entering the industry would involve
ownership of foreign reserves, shipping lines plus loading and unloading
facilities, as well as the cost of a calcining plant. Here the economies
of multiplant ownership found by Bain seem evident.
These observations indicate that abatement gypsum production by
utilities would significantly lower entry costs east of the Mississippi
River and slightly in other areas. If these observations are true, it
would be expected that in the East and Southeast in particular, new
wallboard manufacturing plants would be built "across the fence" from
utilities to use the abatement product and would be located closer to
interior markets. Thus, the long-run demand for abatement gypsum may be
expected to change in response to new plant locations.
Prices
Largely because of the degree of vertical integration of the
industry, there is no "market" for gypsum for wallboard use. Gypsum is
sold by producers for use in the cement and agricultural industries.
Price announcements are made to the cement industry; and as would be
expected from the nature of the industry, they are changed infrequently,
and the product is sold on a contract basis. In agriculture there is a
degree of market and market-price establishment mechanism developing as
a result of the introduction of byproduct gypsum from fertilizer manu-
facture.
Mining and calcining firms provide regular reports to the Bureau of
Mines. These reports include the value of product at the mine. The
value reported is the average net sales price received for gypsum sold
during the period. Value information is reported as an average for all
gypsum sales, as an average for cement sales, and as an average for
sales for agricultural use. These figures are summarized on a national
basis in Table 6.
Wallboard prices are on a delivered cost basis and vary widely
between different sections of the country. Representative prices are
published by the Engineering News Record. Prices are quoted in truck-
load lots delivered f.o.b. in 20 cities across the United States for
1/2-inch board. In the January 1976 publication, prices per kft^
ranged from a low of $38.90 in Dallas to a high of $90.00 in Chicago.
Review of these prices on a quarterly basis from 1972 to the present
indicates the same degree of variability between cities reported, but
the Dallas market is consistently the lowest and Chicago generally the
highest.
23
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TABLE 6. GYPSUM USE AND VALUE BY MAJOR CONSUMING SECTOR
Year
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
Calcined,
ktons
10,437
9,820
9,019
9,227
10,657
9,797
9,360
10,035
10,519
10,326
10,112
9,826
9,313
10,391
10,861
9,953
12,291
14,217
14,917
12,841
10,390
Average
value ,
$/ton
3.18
3.31
3.25
3.38
3.59
3.63
3.68
3.65
3.67
3.64
3.73
3.70
3.66
3.67
3.88
3.12
3.75
3.93
4.18
4.41
4.51
Cement ,
ktons
2,226
2,394
2,273
2,416
2,757
2,543
2,763
2,765
2,898
2,986
3,152
3,372
3,154
3,439
3,464
3,358
3,386
3,924
4,148
4,058
3,244
Average
value ,
$/ton
3.92
4.02
4.21
4.23
4.30
4.42
4.27
4.47
4.46
4.52
4.62
4.62
4.66
4.66
4.58
4.74
4.78
4.94
5.35
5.94
6.25b
Agriculture,
ktons
678
830
830
1,021
1,188
1,126
1,088
1,241
1,262
1 ,270
1,265
1,276
1,280
1,388
1,100
804
1,124
1,146
1,453
1,671
1,482
Average
value ,
$/ton
3.39
3.37
3.76
3.30
3.09
3.29
3.50
3.40
3.46
3.52
3.68
3.96
4.27
4.48
4.85
5.27
4.79
5.21
5.09
7.62
8.00b
a. U.
S. Bureau
of Mines,
Minerals Yearbook.
b. Estimated.
In general, prices are lower near calcining plants. Prices also
tend to reflect competitive conditions in the industry although the
Dallas-Chicago comparison is the most striking. Six firms produce in
the Dallas area while only one is located near Chicago. The Detroit
area also reports generally low prices. The January 1, 1976, price was
$58.50/kft2. Four firms are located in Michigan. Sources of crude
gypsum for Detroit and Chicago are both located in Michigan. Three
plants in Michigan are located at mines. One is located in Detroit and
crude gypsum is barged from a mine in Michigan.
The price comparisons shown tend to confirm greater difficulty of
entry in the eastern market. Prices in these areas can apparently be
held at somewhat higher levels without attracting potential entrants.
If higher than normal profits are now being realized in this market
because of effectively blocked entry, abatement production would likely
reduce product prices.
24
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Proximity to wallboard markets is a major advantage for a firm in
competing for markets. If abatement production afforded an opportunity
to construct new plants closer to existing markets, other producers
would be placed at a cost disadvantage. Based on past history, other
firms would be expected to build new plants in order to compete with the
initial plant. Therefore, any new plant to be built on the basis of
abatement production must be predicated on its future ability to compete
with other plants using crude gypsum from conventional sources. In
other words, abatement product cannot be sold for more than delivered
costs of crude gypsum at the same location.
25
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MARKETS FOR ABATEMENT GYPSUM
The previous section dealt primarily with the industry character-
istics on the supply side. The potential for substitution of abatement
gypsum is influenced by the factors considered in this section.
Markets for crude gypsum could be categorized by types of processes
involved and by similarity of forces affecting demand for products. The
Bureau of Mines (13) categorizes markets along the lines of similarity
of factors affecting demand. For purposes of showing historical use
patterns and for projecting future uses by markets, the Bureau of Mines
has divided end uses into three major categories: (1) construction, (2)
agriculture, and (3) others. Construction uses are subdivided into
building uses such as plasters, prefabricated products, and a cement
retarder.
TECHNICAL SUBSTITUTION
It should be clearly understood that a full technical assessment of
substituting abatement gypsum for crude gypsum is outside the scope of
this project. However, in the course of working on the study, some
information pertinent to the technical aspects of abatement gypsum has
been developed and is reported. Abatement gypsum is similar to natural
gypsum and should be environmentally safe for indefinite storage as a
future sulfur reserve or other purposes.
From the product specifications provided in the section on the
gypsum industry, gypsum is 85% or more CaSO^'Z^O. Impurities may be
categorized into three different forms (15): (1) insoluble or related
insoluble materials including clay, silica, minerals, and limestone, (2)
soluble chloride minerals, such as halite or sylvite; and (3) hydrous
minerals such as the sulfate salts mirabilite and epsomite and the
montmorillonite group of clay.
Abatement gypsum, by comparison, is a fine crystalline material
containing up to 20% free moisture. It is approximately 96% pure calcium
sulfate. Impurities are 4% calcium carbonate and less than 0.05% soluble
materials.
The degree and amount of impurities that can be tolerated depend on
the product to be manufactured and the competitive situation of gypsum.
For wallboard manufacture, to the extent that impurities replace gypsum,
strength is reduced and more pounds of stucco are required to achieve a
27
-------
given strength of finished plaster or wallboard. Soluble chloride minerals
affect calcining temperature, set time, and stucco slurry consistency.
Soluble chlorides are limited to 0.02 to 0.03%. The hydrous sulfate salts
are also limited to 0.02 to 0.03% as they affect moisture pickup and
bonding characteristics of the stucco in the core of the wallboard.
Hydrous clays of up to 1.0 to 2.0% may be tolerated.
Crude gypsum received at calcining plants is crushed and ranges
from dust to stones of minus 8 inches. Typically, it is handled and
stored outside. At the time of use the gypsum may contain up to 3% free
water.
Abatement gypsum made from oil-fired power plants is being used
extensively and successfully by wallboard and cement manufacturers in
Japan (25). To date, there have been no commercial applications of
these processes in the United States, but it is understood that at least
two firms are actively studying the possibility at this time. In addition,
a demonstration-scale facility using the Chiyoda process has been operated
at the Scholz plant of Gulf Power Company. Samples of product made from
that facility have been used to manufacture wallboard under plant condi-
tions. Results and specific conditions of the tests are proprietary
information, but, in general, the wallboard manufactured met normal
quality control tests.
Gypsum is used in the cement industry as a set retarder. Cement
clinkers are manufactured and stored, and as final product is needed,
gypsum is added to the clinker and ground into the final product.
Apparently, the S0
-------
This handling equipment cannot effectively handle the consistently small
crystal size of abatement gypsum. In calcining operations the excessive
free water, which is 20% as compared with 3% for crude gypsum, would
have to be driven off. Because of heat in the reactions in cement
manufacturing, the free moisture may not be a problem with the exception
of how it affects handling qualities. New plants could be designed to
handle the abatement product, or the utility could compact and dry the
abatement product to overcome these problems. Also, abatement gypsum
could be viewed as a source of high purity gypsum to blend with crude
gypsum. The disadvantages could be minimized and the advantages fully
used.
This is a very brief overview of work that has been done with
abatement gypsum. This study is being conducted under the assumption of
perfect substitution between abatement and crude gypsum. To determine
the technical aspects of abatement gypsum and its substitutability will
require more research into composition, crystal size, and structure as
well as testing under operating conditions.
Phosphogypsum from fertilizer manufacture is of lower purity and
its impurities preclude its use in cement or calcining operations
without further processing. At existing or projected conditions, the
processing costs are greater than the value of competitive crude gypsum.
Phosphogypsum is not considered a factor in the study.
CHARACTERISTICS OF WALLBOARD MARKET
Gypsum products must be tailor-made to meet exacting building
specifications, and purchasers are well informed. Consequently, there
is little opportunity for product differentiation in the gypsum product
industry.
In general, gypsum products are sold on a zone-delivered-price
basis; each firm faces a downward sloping demand curve. Feedback
mechanism from purchaser to producer is almost instantaneous, and any
price cut by one firm is matched promptly by all others. It is not
clear that a dominant price leader exists in the industry. A memorandum
opinion in the case of Wall Products Company versus National Gypsum
Company in the U.S. District Court of California (21) reported that
several different firms initiated price changes during the late sixties.
The industry has been faced with problems of price wars when a firm
makes price and other concessions in an attempt to add to its market
share in a given region. When firms in the industry have taken steps to
prevent further price deterioration, they have run afoul of antitrust
legislation.
Lack of effective substitutes and the low cost of gypsum in relation
to the final product indicate that demand in terms of price of gypsum or
gypsum products is highly inelastic. That is, changes in the price of
29
-------
gypsum or gypsum products would have relatively little effect on quantity
taken and changes in the price of crude gypsum would have even less
effect on the quantity used for wallboard manufacture or in increasing
sales of wallboard products. In terms of abatement market possibilities
this would indicate that little expansion of gypsum sales would result
from a general lowering of gypsum price levels. Abatement markets in
the short run are developed only as a result of replacing crude gypsum
that would be used in existing calcining plants. In time, new calcining
plants may be built in association with utilities to serve markets that
are distantly removed from existing plants.
Because of the inelastic nature of demand for gypsum products and
the structure of the industry, it would be reasonable to assume that
lower prices of abatement gypsum would not be passed on to the consumer
of gypsum products as a result of its use by the existing industry. It
may be further assumed that existing producers would purchase and use
abatement gypsum at competitive prices even at the expense of their own
mining operations rather than see it encourage new entrants to the
industry. This reaction would be particularly true if relatively small
quantities of abatement gypsum were to be produced.
Gypsum products are used in the building industry as an interior
wall covering and in building shaft walls in high-rise buildings. It is
one of a number of products that can be used in a building system.
Today, most interior walls are made of wood framing and then covered
with wallboard. This system is inexpensive relative to other construc-
tion methods. The gypsum product also has additional qualities of fire
and noise resistance. Because of these qualities, over 90% of all
interior walls are covered with gypsum products (27). Substitute
systems for buildings are available; but when wood or metal framing is
used, there are few substitutes for gypsum. Wood paneling and glass
walls are substituted for gypsum products for aesthetic purposes where
price is a minor consideration. Low-cost wood paneling has the disad-
vantage of lack of fire resistance which prevents its ability to sub-
stitute more fully for gypsum wallboard. When engineering and design
specifications for interior walls call for wood or lightweight metal
framing, there are few, if any, effective substitutes for gypsum wall-
board covering.
Gypsum products make up a very small percentage of the total cost
of construction. Although estimates of the cost of gypsum in today's
average-value homes are not available, conversations with those asso-
ciated with the industry indicate that gypsum costs amount to less than
1% of the total cost of the house. In high-rise buildings, the per-
centage would be even less. In 1974, total prefabricated products
accounted for only 0.5% of the total value of construction. The value
of the crude gypsum alone would be far less. Its value historically has
been approximately 10% of the value of final gypsum products (Table 7).
30
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TABLE 7. GYPSUM PRODUCTS, AVERAGE ANNUAL VALUE AT PLANT,
AVERAGE VALUE CRUDE GYPSUM AT MINE, AND VALUE OF GYPSUM
AS PERCENT OF PRODUCT VALUE - 1972 CONSTANT DOLLARS*
Gypsum products
per kft2,
Year $ value
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
58.30
50.84
51.17
51.54
52.54
52.63
53.51
53.24
52.58
47.88
47.75
45.40
42.87
39.42
33.65
32.90
35.09
35.46
36.40
32.63
Crude gypsum
per ton,
$ value
5.14
4.87
4.94
5.17
5.13
5.14
5.04
5.00
4.89
4.91
4.74
4.57
4.38
4.42
4.02
3.87
3.93
3.94
3.80
3.81
Gypsum value
relative to
product value, %
8.8
9.6
9.7
10.0
9.8
9.8
9.4
9.4
9.3
10.3
9.9
10.1
10.2
11.2
11.9
11.8
11.2
11.1
10.4
11.7
a. U.S. Bureau of Mines, Minerals Yearbook.
Use of wallboard products is highly dependent on the fortunes of
the construction industry, in particular the residential building segment,
As a result, the annual quantity demand is highly variable (see Figure 4),
Annual use data are shown in Table 8.
31
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U!
NJ
Observed
Predicted
1955
1965
1975
Figure 4, Observed and predicted consumption of wallboard products, 1955-1975.
-------
TABLE 8. QUANTITY PREFABRICATED WALLBOARD PRODUCTS CONSUMED,
VALUE OF CONSTRUCTION, AND RESIDENTIAL CONSTRUCTION
AS A PERCENT OF TOTAL CONSTRUCTION
Year
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
Mft2 Value
wallboard construction,
products G$a
6,590,878
6,771,889
7,417,340
8,688,903
7,982,442
7,808,342
8,451,944
8,906,272
9,289,427
9,721,452
8,391,566
8,280,657
9,550,719
10,282,383
9,562,956
11,889,927
14,184,059
15,004,025
12,910,350
10,742,008
60.44
57.18
54.62
60.59
57.96
57.30
61.55
63.30
64.85
69.51
68.65
65.95
72.15
76.24
72.78
83.18
104.50
109.06
94.80
80.41
Residential
value as %
total
55.7
52.9
55.6
60.4
55.8
55.2
56.9
58.1
56.6
51.6
46.8
47.2
49.8
48.8
46.3
53.0
59.3
57.6
50.1
48.0
a. Expressed in terms of constant 1972 dollars.
Gypsum products are supplied by calcining plants in response to
demand in the construction industry. In 1975, 74 plants were in operation.
These plants are strategically located to serve regional market demands
and to minimize transportation cost. In major regional market areas,
several firms may have calcining plants to serve those markets. Gypsum
products essentially move from lowest cost supply points into markets.
Calcining plants serving the interior of the country are located at
gypsum mines and those serving coastal markets are located at seaports
to use imported material at its lowest cost.
33
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Demand at existing plants is quite variable on a year-to-year basis
as shown in Table 9. This variability in use on a year-to-year basis
will pose problems for both the utility and the calcining plants. The
utility will be most interested in disposing of all its product, but it
could not supply gypsum above that produced in meeting its power demands.
If the utility is to develop arrangements for sale of its total abate-
ment production on a year-to-year basis, flexibility would be required
on the part of the purchaser. This flexibility would amount to a
service to the utility which would involve an increased cost to the
purchaser. If the utility does not make these arrangements, it must be
prepared to stockpile its product to meet the fluctuations in demand.
The utility has the option to stockpile unsold gypsum to be sold in
future years.
TABLE 9. NUMBER CALCINING PLANTS, ANNUAL TONS GYPSUM CALCINED,
AND AVERAGE PLANT USE, 1970-1975*
Number calcining
1970
plants 76
1972
76
1973
76
1974
77
1975
74
ktons
Gypsum used
Average use
by plants
per plant
9,153
120
14,217
187
14,917
196
12,841
167
9,885
134
a. U.S. Bureau of Mines, Mineral Industry Surveys, 1970-75.
If abatement gypsum is to be produced on an economically feasible
basis by a utility, it must develop its major market outlet through an
existing calcining plant or its long-range planning might involve
across-the-fence delivery of abatement gypsum to a new calcining plant.
The existing gypsum products industry was built on the basis of existing
supplies and markets. Manufacturing plants tend to be located in clusters.
For example, there are seven plants located in south Georgia and north
Florida. The next nearest cluster of plants is several hundred miles
away. The locational phenomena precludes many utilities from a market
for abatement gypsum through existing plants, but by the same token
provides opportunities to supply new plants built specifically to use
the abatement product.
34
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CHARACTERISTICS OF CEMENT MARKET FOR GYPSUM
Gypsum is used in the cement industry to control the setting time
of portland cement. While the amount of gypsum used per ton of cement
varies depending on a number of factors, the industry average is about
5% by weight of the finished product (28).
The cement industry like the wallboard industry is closely tied to
the level of construction activity. While there is some competition
between cement and wallboard, they normally have different uses in
construction. The cement industry is more closely linked to public
works—highways, bridges, dams, and major construction—while the wall-
board industry is more closely linked to residential construction
activity. Domestic demand for cement is quite variable on a year-to-
year basis and has shown annual variations of up to 5 Mtons. Domestic
production has shown the same variability. Imports of cement have
increased sharply since 1965.
Much of the recent increase in imports has been in clinker form.
The imported clinker is then mixed with gypsum and ground into finished
product. According to a recent Bureau of Mines publication (29), a
part of the increased reliance on imports of clinkers may be attributed
to stringent environmental regulations imposed in 1969. A number of
kilns were closed due to the regulations and clinker was imported for
distribution in the United States. From 1961 to 1969, imports of clinker
amounted to about 10% of total imports but had increased to 41% in 1973.
With declining use in 1974 and 1975, clinker imports dropped to 32 and
33% respectively.
The cement industry is an energy-intensive industry. According to
the Bureau of Mines estimates, energy costs make up 40% or more of the
direct costs of manufacturing cement. As a result of shortages and high
prices of oil and gas, coal is now being considered as an alternative
fuel source. New plants and plant expansions are geared toward larger
capacity installations. This change may tend to increase gypsum require-
ments at specific locations as the industry adjusts to meet new economic
conditions. However, the cement industry could supply a portion of its
own demand for gypsum by producing abatement products from sulfur in coal.
Clinker may be stored outside for prolonged periods, but finished
cement is perishable when exposed to moisture. Even if imports continue
to increase, it appears that much of the increase will be in clinker
form. If that is the case the domestic demand for gypsum will be based
on the final demand for cement whether it is produced domestically or
imported in clinker form.
The locations of existing and projected cement plants including
grinding plants are shown in Figure 5. The average use of gypsum was
over 23 ktons/plant in 1974 and the capacity of the industry was approx-
imately 95 Mtons (30).
35
-------
'
'•
Figure 5. Location of domestic cement production plants, 1975 (Portland Cement Association).
-------
Finish grinding capacity in the United States was approximately 103
Mtons and about 74% of capacity was used in 1974. In 1973, finish
grinding capacity was approximately 97 Mtons and was operated at about
83% of capacity (31). The year of 1973 represented a record year for
both production and consumption of cement in the United States. The
average consumption of gypsum for each domestic cement plant was approx-
imately 23 ktons. Data are not available to determine gypsum require-
ments for each cement plant, but capacity ratings should serve as a
reliable guide. The Portland Cement Association has published a listing
of all cement-producing plants in the United States that gives capacity
and location information (32). This information will be utilized in
developing specific demand points and quantities of gypsum demanded by
the cement industry. The total projected capacity in 1978 is expected
to be approximately 98 Mtons.
The Bureau of Mines recently published statistics (30) relative to
the utilization of capacity by the cement industry. Portland cement
statistics showing demand, production, prices, and imports between 1964
and 1975 are shown in Table 10. Between 1950 and 1974 capacity utiliza-
tion has ranged between 72 and 92%. In twelve of those years utilization
was between 70 and 80%. In seven years, utilization was between 80 and
90%; and in five years, utilization was greater than 90%. In this study
it is assumed that the industry will operate at 85% of capacity as
projected by the Portland Cement Association. It is further assumed
that each plant will operate at 85% of capacity. The gypsum demand for
a 500,000-ton/year cement plant would amount to 21,250 tons; 1% change
in capacity utilization would result in a 250-ton/year change in demand
for gypsum.
TABLE 10. PORTLAND CEMENT, U.S. DEMAND, PRODUCTION,
PRICES, AND IMPORTS - 1964-753 (29)
Year
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
U.S. demand,
Mtons
68,865
70,328
71,570
70,315
74,720
77,047
73,407
79,005
81,432
86,399
82,917
U.S. production,
Mtons
69,303
69,827
72,311
69,477
74,243
75,125
73,168
77,007
80,744
83,551
79,486
Mill value,
$/ton
16.98
16.75
16.59
16.72
16.80
17.04
17.69
18.74
20.31
21.88
25.62
Imports,
Mtons
683
1,035
1,328
1,112
1,370
1,821
2,579
3,088
4,911
6,683
5,732
Gypsum use
in cement ,
Mtons
2,986
3,152
3,372
3,154
3,439
3,467
3,358
3,368
3,924
4,148
4,058
37
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CHARACTERISTICS OF AGRICULTURAL MARKETS
Gypsum use in agriculture, while showing an annual variation, has
grown slowly. In 1965, 1.359 Mtons of gypsum were used, and by 1974,
its use had grown to 1.671 Mtons. Agricultural use of gypsum has
amounted to between 6 and 10% of the total annual use of crude gypsum
during this period. Gypsum has two major uses in agriculture: (1) as
a soil amendment on high-alkali soils that are reclaimed and irrigated,
and (2) as a neutral source of calcium for peanut production. Other
uses are to provide sulfur on sulfur-deficient soils and as animal
feed additives.
The agricultural market for gypsum is centered in the Pacific
region and more particularly in California. According to information
from the Bureau of Mines, approximately 85% of the total agricultural
use of gypsum is in that area. Primary agricultural uses are for soil-
conditioning purposes in southern California, while in the northwestern
coastal area where soils are deficient in sulfur, gypsum is used as a
source of sulfur. Sulfur is a necessary plant nutrient, but, in the
past, it has been a normal constituent of fertilizers. The fertilizer
industry has changed to provide a high-analysis, sulfur-free product.
Along with that change and the continuing increases in yields, sulfur
deficiencies in crops have become a matter of concern in many areas of
the country. Gypsum could be used to overcome those needs; however, the
current trend appears to be to add sulfur to fertilizers to correct
specific soil and crop problems when they are identified. Sulfur require-
ments for each acre are usually small. For example, most state extension
services suggest that 10 pounds of sulfur for each acre of corn is
adequate to provide sulfur when it is shown to be deficient. That
amount of sulfur included in fertilizer permits its addition with only
one application. If gypsum were used, an extra application step would
be required. Both crude gypsum and gypsite are used for agricultural
purposes, and in recent years byproduct gypsum from phosphatic fertil-
izer manufacturing has been used in increasing amounts. The Bureau of
Mines recently began collecting and compiling data relating to the use
of this source of byproduct gypsum in California. According to the 1974
Minerals Yearbook (13), three byproduct manufacturers supplied 463 ktons
for agricultural use at a total value of $4.3M.
Gypsum is used in the Pacific region and elsewhere as a soil
amendment on alkali soils. These soils contain excessive adsorbed sodium.
Soil particles, because of negative electrical charges at their surfaces,
adsorb cations, such as calcium, magnesium, and sodium. When sodium takes
up 15% or more of a soils cation exchange capacity, it is termed an
"alkali soil" (33).
Normally, calcium and magnesium are the major cations in the soil
solution and on soil particles of productive soils. When these soils
are irrigated with water containing sodium, this cation soon becomes
excessive and alkali soils are formed. As a result, the rate at which
plants can absorb water is reduced and plant growth is retarded. When
38
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alkali soils do not naturally contain gypsum, they must be leached with
some form of soluble calcium or magnesium to restore them to normal
productivity. (When sulfur is added, it hydrolyzes to sulfuric acid and
hydrogen replaces sodium.)
Soil amendments may be of three types: soluble calcium salts
(calcium chloride and gypsum) ; low solubility calcium salts (limestone);
and acid or acid-forming compounds such as sulfur, sulfuric acid, iron,
and aluminum sulfate (33). Because of their low cost and suitability,
gypsum and sulfur are the most widely used soil amendments. Limestone
is also inexpensive but is of little value except on acid soils. Most
alkali soils already contain lime. Gypsum is also used as an addition
to irrigation water containing soluble sodium salts.
While other soil amendments can be used, gypsum is the most widely
used because of its suitability, availability, and low cost.
Although the principal agricultural use of gypsum is as a soil
amendment on alkali soils, it also has important uses in peanut pro-
duction. Peanuts require large amounts of soluble calcium in the soil
surface to facilitate pegging and nut formation. Gypsum use is recom-
mended when soil pH is already satisfactory, but additional calcium is
needed (gypsum is a nonalkaline source of calcium). Typical recommenda-
tions range between 500 and 1000 pounds of gypsum per acre when needed.
Peanuts are grown in southern and southwestern states. Estimates
of peanut production by states are shown in Table 11.
TABLE 11. PEANUT PRODUCTION BY STATES - 1974a
State Acres
Alabama 198,500
Florida 55,000
Georgia 516,000
North Carolina 166,000
Oklahoma 228,000
Texas 576,000
Virginia 107,000
Total acres 1,843,500
a. Taken from estimates of acres grown by
crops (data tapes from Statistical Reporting
Service).
39
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Due to the number of substitutes that exist for gypsum in agricul-
tural uses, demand for this purpose should be more elastic than for
construction uses. The Bureau of Mines has projected agricultural use
of gypsum to increase from 1.450 Mtons in 1973 to 4 Mtons by the year
2000. The projection is based on the assumption that land will continue
to be withdrawn from agriculture and that there will be a continued
incentive to increase yields and to bring presently marginal agricultural
land into productive uses. Alkali soils for which gypsum is particularly
useful make up a significant portion of the marginal land that may be
brought into more intensive use. These soils occur in the Western
States which imply that the majority of increased use of gypsum will
occur in that area (20).
The projected 4 Mtons for agriculture is approximately 11% of the
total projected use of crude gypsum in the year 2000. This projection
is consistent with the current agricultural share of total gypsum use.
Agricultural use of gypsum will continue to represent a significant
market for gypsum in localized areas. Byproduct gypsum from fertilizer
manufacturing operations is becoming an increasingly important source of
supply of agricultural gypsum. The Bureau of Mines has only recently
begun to collect data relative to quantities of byproduct gypsum used in
agriculture. In addition to the quantities already reported used in
California, it is known that byproduct gypsum is being supplied from
fertilizer manufacturing firms in the South as well.
Data are not sufficient to establish quantity demands for agricul-
tural gypsum by specific points to allow further study of agricultural
markets within the methodology of this study. Agricultural markets are
not included in the final market solution model used in this study.
GROWTH IN DEMAND FOR GYPSUM
Growth in demand for gypsum products is dependent primarily on
growth in the construction industry. On a year-to-year basis, demand
for gypsum has shown a great deal of variability, but over time there
has been an upward trend in use. Table 12 characterizes growth in
demand from 1965 to 1976 by major components.
The Bureau of Mines has recently published estimates of projected
gypsum use by its major components. The projections were based on
historical data through 1973. Total gypsum use by the year 2000 was
projected to increase at an annual rate of 2%, and consumption was
projected to fall within a range of 26 to 56 Mtons. Probable consump-
tion was projected at 26 Mtons in 1985 and 34.8 Mtons in 2000. Projec-
tions compared with 1973, 1974, and estimates of 1975 and 1976 are shown
in Table 13.
40
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TABLE 12. GYPSUM USE BY MAJOR MARKETS, KTONS
Calcined
Year Total products Cement Agriculture Other
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
16,092
14,778
14,132
15,625
15,818
14,334
16,914
19,412
20,636
18,693
15,588
18,827a
11,137
9,703
9,274
10,333
10,763
9,790
12,028
13,920
14,565
12,515
10,390
13,574
3,152
3,372
3,154
3,439
3,464
3,358
3,386
3,924
4,148
4,058
3,244
3,308
1,359
1,240
1,280
1,386
1,100
805
1,124
1,146
1,453
1,671
1,482
1,314
444
463
424
465
491
381
376
422
470
449
N/A
N/A
a.
Estimated from preliminary data. Source: A. H, Reed,
"Gypsum." Bull. 667, U.S. Bureau of Mines, Table 3,
p. 4.
41
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TABLE 13. FORECASTS OF GYPSUM USE, KTONS
ro
Forecast
Total use
End use
Calcined products
Cement
Agriculture
1973
20,636
14,565
4,148
1,453
1974
18,693
12,515
4,058
1,671
1975a
15,588
10,390
3,244
1,482
19763
18,827
13,574
3,308
1,314
range
Low
25,800
18,000
6,000
1,000
2000
High
55,500
40,000
10,000
4,000
Probable
1985
26,000
N/A
N/A
N/A
2000
34,800
20,000
10,000
4,000
a. Estimates from preliminary information. Source: U.S. Bureau of Mines preprint,
Tables 6 and 7 (p. 7) and conversations with Bureau personnel for 1975 and 1976
estimates.
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These projections indicate continued growth in demand for gypsum in
its major uses—barring some completely unforeseen change in technology
of construction. Such changes are unlikely because gypsum is widely
available at a low cost. Gypsum products have a great deal of flexi-
bility in use. They have distinct advantages over possible substitute
products in fire and noise prevention in buildings. Gypsum products
manufacturers actively seek to develop new uses and improve existing
uses for their products. The development of gypsum board with special
fire-retardant qualities and the greatly expanded use of wallboard and
other gypsum products in high-rise structures are but two examples of
many innovations made by the gypsum industry to expand uses for its
products.
POTENTIAL NEW MARKETS
The Mobile Home Industry
The mobile home industry may develop as another major new use for
wallboard products. Representatives of the Gypsum Association have
indicated an expected increase in use of wallboard products by the
mobile home industry as a result of recent changes in fire safety codes
for mobile homes. Although it is much too early to quantify the impact
of the mobile home market on total wallboard demand, the president of
the Gypsum Association has indicated that he expects a market for
approximately 1.5 Gft2 of wallboard products to develop by 1985 when the
production of mobile homes is expected to reach 600 kunits according to
the projections released by the U.S. Department of Commerce (34).
Mobile home production is concentrated in 10 states that account
for 75% of the 1972 production. These 10 states in order of total
production were Georgia, Indiana, Texas, California, Alabama, Pennsyl-
vania, Florida, North Carolina, Kansas, and Idaho. If the mobile home
industry does begin to use wallboard products, it would represent
significant new markets for the wallboard products in these states or
localities.
New markets for wallboard products by the mobile home industry have
not been accounted for in projections of national or regional demand.
If such markets do develop, they would be in addition to estimates
already made.
Agricultural Use of Gypsum Under Changing Conditions
The Sulphur Institute has recently published a series of technical
articles dealing with potential sulfur needs in the United States.
Potential sulfur requirements for the United States are summarized in
Table 14. Total requirements amount to 2.5 Mtons of sulfur. This
potential was based on calculated sulfur needs if crops grown in 1967
were fertilized according to recommended rates. Each geographical area
in the United States was shown to need additional sulfur. Approximately
43
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5.4 tons of gypsum are required to provide 1 ton of sulfur. If total
sulfur requirements were supplied from gypsum, a total of 13.5 Mtons
would be required. These projections of potentials are based on 1967
cropping patterns and recommended rates of fertilization (35). Undoubt-
edly, those potentials would be much higher if they were being projected
to 1980 or 1985 conditions. Rapid increases in the use of nitrogen is one
indication of growth in the potential need for sulfur. Agronomists
consider the nitrogen to sulfur ratio in plants to be one of the major
factors in projecting the sulfur potential. For each 10 pounds of nitrogen
used by a plant, there must also be 1 pound of sulfur used. In 1976,
the consumption of nitrogen in the United States amounted to 10.6 Mtons.
TVA analysts project total nitrogen use in 1980 to amount to approximately
11.8 Mtons.
TABLE 14. POTENTIAL CONSUMPTION OF SULFUR AS A PLANT NUTRIENT
IN THE UNITED STATES BY REGIONS AND EQUIVALENT GYPSUM3
Region
Intertilled
and close-
growing
Hay and
pasture
Total
crops
Equivalent
gypsum
New England
Middle Atlantic
South Atlantic
East North Central
West North Central
East South Central
West South Central
Mountain
Pacific
Total
8,358
56,175
110,886
302,162
436,480
64,927
149,681
29,200
88.014
15,298
53,607
97,933
87,059
312,484
68,342
194,720
86,140
332,105
23,656
109,782
208,819
389,221
748,964
133,269
344,401
155,340
420,119
127,742
592,823
1,127,623
2,101,793
4,044,406
719,653
1,859,765
622,836
2,268,643
1,745,883 1,247,688 2,493,571 13,465,283
a. Source: "Potential Plant Nutrient Consumption in North America.1
The Sulphur Institute, Technical Bull. No. 16, Table 2, p. 23.
It is not suggested that this amount of sulfur will be applied
directly by farmers or that all sulfur applied will use gypsum as the
basic source. It only suggests that abatement gypsum in large quantities
in many areas of the country could be used in a positive manner in
agriculture as an alternative to throwaway processes.
44
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The analysis of the demand for gypsum in agriculture indicates that
use of gypsum would be responsive to lower prices. The indication that
quantity used would increase significantly as a result of lower prices
leads to an optimism that agricultural use of gypsum could be materially
expanded for positive productive purposes by the combination of price
reduction, time and place availability, and ease of application of the
material.
Further work is needed to assess the practicality of the alternatives.
To assure that a large amount of gypsum is used for agricultural purposes
would require a decision at some level of government to subsidize the
production and use of abatement gypsum to make it economically attractive
to utilities and farmers.
The foregoing discussion of potential agricultural use of gypsum
under a planned program to produce and utilize abatement gypsum in lieu
of throwaway sludge suggests the need for further consideration. Initial
evaluation from an agronomic and economic viewpoint under varying assump-
tions of SC>2 emissions, cropping practices, and price relationships of
other sulfur sources is suggested.
Projected Gypsum Use - 1978
This study focuses on 1978 conditions projected by the utility
industry as the base year for the study. Markets for byproducts for the
year 1978 are estimated that give an indication of supply-demand conditions
facing the utility in that year. Maximum consumption of gypsum occurred
in 1973 when 20.6 Mtons was used. Use dropped sharply through 1975 down
to 15.6 Mtons reflecting the depressed state of the economy in general
and the construction industry in particular. Use was estimated at 18.8
Mtons in 1976. It appears that gypsum consumption in 1978 or shortly
thereafter will equal the 1973 level of over 20 Mtons. In that year,
14.565 Mtons was used in calcining plants, 4.1 Mtons in cement use, and
1.4 Mtons was used in agriculture. This figure provides a conservative
estimate upon which to base long-range planning. Estimates of use in
cement are actually based on an assumption of 85% of actual capacity
projected by the cement industry for 1978. This amounts to 4.042 Mtons
compared to 1973's use of 4.148 Mtons.
An annual growth rate of 2% or less each year does not represent a
rapidly growing demand, but continued growth in demand seems assured.
This factor is probably of more interest to the utilities since their
strategy would have to be based on replacing crude gypsum in its present
uses rather than developing new markets.
Within that strategy replacement of imported materials appears the
most viable prospect. Reference to Table 15 shows the magnitude of
imports each year since 1955. Imports typically account for 37-40% of
the total domestic gypsum use. While f.o.b. mine prices are lower in
general than in the United States, the added transportation cost makes
this gypsum slightly higher in price giving more of an opportunity for
45
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abatement producers to develop this market. Prices on imported materials
have increased from $2.24/ton in 1970 to $2.94/ton in 1975 for an increase
of 31%. Prices in the United States during the same period increased
from $3.72 to $4.80/ton for an increase of 29%. Further, to the degree
that rail rate increases of approximately 70% may be reflected in the
costs of water transportation, one could expect transportation costs for
imported gypsum to continue to increase even more rapidly than mining
costs. This could result in additional opportunity for abatement product
to replace imported material.
TABLE 15. GYPSUM USE, PRODUCTION, AND VALUE - 1955-75'
Domestic use,
Year ktons
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
13,994
13,676
12,720
13,210
15,200
14,008
13,692
14,514
15,155
15,879
16,092
14,778
14,132
15,625
15,818
14,334
16,914
19,412
20,636
18,693
15,190
Domestic
production,
ktons
10,684
10,316
9,195
9,600
10,900
9,825
9,500
9,969
10,388
10,684
10,033
9,647
9,393
10,018
9,905
9,436
10,418
12,328
13,558
11,999
9,251
Average
value
f .o.b. ,
$/ton
3.18
3.31
3.25
3.38
3.59
3.63
3.68
3.65
3.67
3.64
3.73
3.70
3.66
3.67
3.88
3.72
3.75
3.93
4.18
4.41
4.80
Imports ,
ktons
3,966
4,336
4,334
4,049
6,135
5,301
4,967
5,421
5,490
6,258
5,911
5,479
4,563
5,474
5,858
6,128
6,094
7,718
7,661
7,424
5,448
Average
value
f .o.b. ,
$/ton
1.58
1.80
1.75
1.70
1.94
1.70
1.82
1.94
1.98
2.13
2.37
2.37
2.87
2.08
2.12
2.24
2.21
2.38
2.30
2.37
2.94
a. U.S. Bureau of Mines, Minerals Yearbook.
46
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New Plant Locations
The analysis based on projected 1978 conditions is essentially a
"short-run" demand study in that it assumes demand points are fixed. If
new locations could be established, more utilities might be considered
potential gypsum producers. The analysis did not consider long-run
aspects as they relate to possible across-the-fence wallboard manufacturing
plants, except to list potential supply points. Substantial additional
work, including analysis of end product markets would have to be done
to adequately cover this possibility.
Data are available to compare production of calcined gypsum products
with consumption on a regional basis since 1970. These data indicate
rather stable consumption patterns over time and lead to the conclusion
that regional markets as a percentage of total markets can be expected
to remain quite stable. These data are shown in Table 16. Development
of the industry around existing sources of raw materials and markets has
resulted in overproduction in some regions and underproduction in others.
This provides an opportunity for calcining plants to be built across-
the-fence from utilities that would supply their gypsum requirements.
The inland areas of the Southeast are the most obvious potential new
locations. Reference to figures showing mine and plant locations indi-
cates the entire southeastern area is served from fringe points.
47
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00
TABLE 16. REGIONAL CONSUMPTION WALLBOARD PRODUCTS AND PERCENT
OF TOTAL U.S. CONSUMPTION, COMPARED TO REGIONAL PRODUCTION, 1975'
<}
Consumption, kft"
Consumption, states
New England
% of U.S.
Middle Atlantic
% of U.S.
East North Central
% of U.S.
West North Central
7, of U.S.
South Atlantic
% of U.S.
East South Central
% of U.S.
West South Central
% of U.S.
Mountain
% of U.S.
Pacific
% of U.S.
1971
599,733
5.0
1,445,695
12.1
1,899,212
15.9
816,100
6.8
2,183,400
18.3
689,796
5.8
1,601,927
13.4
811,121
6.8
1,863,795
15.6
1972
714,143
5.0
1,675,887
11.7
2,195,527
15.3
960,787
6.9
2,799,276
19.5
845,511
5.9
1,950,459
13.6
1,077,558
7.5
2,100,962
14.6
1973
754,487
5.0
1,833,551
12.1
2,286,213
15.1
982,728
6.5
3,148,819
20.8
872,981
5.8
1,863,788
12.3
1., 142, 407
7.5
2,199,509
14.5
1974
635,863
4.9
1,575,276
12.3
1,934,285
15.0
890,239
6.9
2,650,507
20.6
741,168
5.8
1,505,508
11.7
909,993
7.1
1,875,903
14.6
Regional
production
1975 % of U.S., 1975
539,959
5.0 2.8
1,257,871
11.6 17.1
1,694,319
15.7 16.7
858,964
8.0 9.8
1,763,458
16.3 14.3
615,576
5.7
1,457,730
13.5 20.7
797,983
7.4 8.8
1,693,335
15.7 9.8
U.S. Bureau of Mines. "Sales of Gypsum in the 4th Quarter."
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METHOD OF ANALYSIS OF ABATEMENT GYPSUM MARKET POTENTIAL
General conditions of supply and demand, growth potentials, and
characteristics of individual markets, along with observations con-
cerning entry conditions have been presented. In addition, projections
of national demand for gypsum for use in the wallboard (calcining plants)
and cement markets have been developed in the previous section. These
projections will be used in the market solutions to be developed. The
analysis also includes possible across-the-fence new calcining plants to
be built to serve existing markets by utilizing abatement gypsum. The
analysis will determine if there are possible points where abatement
gypsum might be lower in cost than crude gypsum from existing supply
points at given prices.
DATA BASE DEVELOPMENT
Gypsum has been shown to be a low-cost product that must be used
near the point of supply because transportation cost quickly becomes a
major part of product value. Location of potential abatement production
by utilities with respect to existing supply and demand points becomes
an extremely important factor in determining the feasibility of abate-
ment production. It is necessary to determine specific information
concerning each demand and supply point. In regard to demand, each
calcining plant receives its supply of crude gypsum from specific
integrated mines. Those specific supply-demand points were identified.
The cement industry and individual cement plants are not so integrated
and are assumed to obtain their crude gypsum requirements at the lowest
delivered costs from any suitable supplier of crude gypsum. Specific
quantity requirements at each demand point of calcining or cement plant
were determined and supply prices and conditions were estimated. The
delivered cost of crude gypsum was calculated for each demand point.
For abatement gypsum to replace crude gypsum at demand points, it must
be available at the demand point at a lower price.
The ability of utilities to supply the demand depends on their
location and relative cost of scrubbing by a gypsum-producing process
compared to the cost of scrubbing by a disposal process or by using
clean fuel. It is assumed that the gypsum process would only be used
when revenue from the sale of gypsum to the preceding described market
would result in adequate revenue to offset the cost difference between
lower cost processes and the gypsum process.
49
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After developing demand and supply data bases, costs of scrubbing
by alternative processes for each utility not in compliance were devel-
oped. After scrubbing costs were developed, market solutions were
generated based on supply-demand conditions, scrubbing costs, and trans-
portation costs utilizing a modified linear-programing transportation
model.
The study is made on the basis that each utility operating in 1978
must be in compliance with air quality laws and regulations effective
July 1, 1976. If a plant is out of compliance, it must undergo changes
that involve cost to continue operation. For purposes of this study,
the plant is allowed to choose among four alternatives: (1) the plant
may scrub by the limestone slurry disposal process, which is the lowest
cost process available and is used as the standard from which other
costs are based, (2) the plant may scrub by the gypsum process, which
results in wallboard quality gypsum that has market value, (3) exclusive
use of low-sulfur fuel (because of age and size of some boilers in
operation, scrubber installation would result in extremely high cost—to
overcome this, a clean-fuel cost parameter was used to provide an alterna-
tive to scrubbing.), and (4) the use of low-sulfur fuel in some boilers
and an FGD system installed on other boilers at the same plant.
The cost under alternative (1) is viewed as the minimum cost
required to continue operation. The plant would choose the gypsum
process only if the total control cost including net revenue f.o.b.
plant from sale of gypsum is equal to or less than the cost under
alternative (1) that includes all costs of disposal. If revenue from
gypsum sales exceeds the cost difference, then the plant would actually
lower its cost of meeting compliance regulations. If revenue just
equaled incremental cost, no savings would be realized, but problems
associated with disposal would be eliminated.
Short-Run Demand
The previous discussion of characteristics of demand for gypsum in
each of its major markets has established that the demand for gypsum in
the construction and cement industries is independent of price. Also,
in both the construction and cement industries demand is concentrated at
relatively few points. Seventy-four calcining plants manufacture all
the prefabricated products used by the construction industry. In 1974
these plants used 12,841 ktons of crude gypsum for an average of over
170 ktons/plant. The cement industry used an average of over 23 ktons
of crude gypsum per plant.
A 500-MW power plant using 3.5% sulfur coal would produce approxi-
mately 240 ktons of abatement gypsum on a dry basis when 90% of the
sulfur is recovered. Because of transportation costs and the location
of supply and demand points, abatement gypsum must be marketed near the
point of production if it is to be economically feasible. Because of
the inelasticity of demand for gypsum, it was assumed that the quantity
demanded will not increase as a result of the manufacture and sale of
abatement gypsum.
50
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A discussion of how the various demand and supply data bases were
developed and how they are used in the analysis follows.
Calcining Plants
In order to utilize the analytical model to arrive at market solu-
tions, it is first necessary to estimate the tonnage of crude or abatement
gypsum that will be consumed at each calcining plant under any assumed
level of domestic consumption.
The data base for 1978 is based on plants that were in operation in
1975 as listed by the Bureau of Mines (36). Of the 74 plants in operation
in 1975, the Bureau of Mines listed the following top 10 in order of
production:
1. U.S. Gypsum's Plaster City plant in Imperial County, California
2. U.S. Gypsum's plant in Martin County, Indiana
3. U.S. Gypsum's Stoney Point plant in Rockland County, New York
4. U.S. Gypsum's Southard plant in Elaine County, Oklahoma
5. National Gypsum's Shoals plant in Martin County, Indiana
6. U.S. Gypsum's Fort Dodge plant in Webster County, Iowa
7. Weyerhaeuser's Briar plant in Howard County, Arizona
8. Georgia-Pacific's Acme plant in Hardeman County, Texas
9. National Gypsum's Savannah plant In Chatham County, Georgia
10. U.S. Gypsum's Jacksonville plant in Duval County, Florida
These 10 plants accounted for 27% of the total production in 1975.
A commercial data service (37) also lists many of the gypsum plants
showing total sales, employment class, and sales at each listed plant as
a percent of total industry sales. Using these sources of information,
it was possible to develop estimates of sales at each plant as a per-
centage of total industry sales. The percentages used were checked
against other information. First, the 10 leading plants had to equal
27% of the total production. Second, imported material for the past 3
years has amounted to 37-40% of the total use. It was assumed that
plants using imported material would account for approximately that
percentage of the total industry sales. Third, the concentration ratio
of the top four firms has consistently been about 80%. The percentages
used meet these three checks and, of course, represent 100% of the total
production. The percentages at each plant were then used to calculate
tons of gypsum required at each demand point (calcining plant) based on
estimated industry requirements for 1978.
51
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Based on the above analysis, the percentage of the national market
estimated for each calcining plant ranged from 0.3 to 3.5%. The per-
centage estimated for each plant is multiplied by the estimated total
industry demand to provide an estimate of crude gypsum demand at each
calcining plant. The national market for 1978 for gypsum use in cal-
cining plants is projected at 14.565 Mtons.
This procedure for estimating short-run gypsum demand at each plant
undoubtedly tends to minimize differences in production levels at given
plants but should, nevertheless, give a good order of magnitude estimate
of quantity needed at each production point. Year-to-year variation in
sales would likely create a greater error in the estimated requirements
at a particular plant than the error in estimating the percentage of
national sales from a given plant for a given year.
There are obvious shortcomings to the method used to determine
gypsum requirements at each calcining plant, but with the available
data, this approach seems the most feasible. Since calcining plants
tend to be clustered, errors at each plant tend to be averaged, and
total requirements for a group of plants in a production area would tend
to more accurately reflect quantity demanded in a given region with
comparable delivered costs of crude gypsum and alternative costs of
abatement gypsum.
New Plant Locations
Plant production and sales as a percentage of national sales would
be expected to vary because of production problems at a particular plant
and over a longer period of time due to shifts in demand for final
product among market locations. For example, the relative growth in
economic activity in the South and Southwest would be expected to cause
the demand for gypsum products to increase in those regions and decrease
or at least slow in rate of growth in other regions. As these changes
take place it is assumed that the plants located nearest to growth areas
would tend to increase sales in both absolute and relative terms until
new plants were built in growth areas to meet the increased demand. If
data were available on a state basis, some of these changes might already
be evident. Data are available on a regional basis and are shown in
Table 16. These data indicate a rather constant relative demand for
gypsum products among census regions. The South Atlantic region is the
only region that indicates a relative decline and the West North Central
and Mountain regions indicate minor relative increases.
Shifts in demand for gypsum products between regions have occurred,
but these shifts have occurred rather slowly. This trend supports the
assumption that, while absolute levels of production vary at individual
plants based on change in the construction industry, relative production
at individual plants would tend to be less variable.
52
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Possible new across-the-fence calcining plants were assumed to have
a minimum demand of 200 ktons gypsum (equivalent to about 500 MW of abate-
ment production) which is consistent with known information relative to
the economical size of plants.
CEMENT PLANT DATA BASE
The Portland Cement Association published a booklet listing all
cement-producing firms and plant locations and capacities in 1975. The
publication also listed all announced planned changes in capacity through
1979. The total capacity in 1975 was 95,112 ktons. Net planned changes
through 1978 add 2,792 ktons to the present making a total capacity of
97,904 ktons.
This study assumes 85% of the projected industry capacity will be
utilized by 1978. The data base in this study is based on the assumption
that each plant in the industry operates at that level of capacity. In
other words, the computer program is designed to multiply the listed
capacity by a constant percentage to estimate cement production at a
given plant location. Gypsum requirements are also assumed constant at
5% of cement.
The data base can be overridden to change either of the percentages
used in this analysis or to directly insert gypsum requirements at each
calcining and cement plant location, if known.
jaupply
Existing mine locations are shown in Figure 6. In a previous
section it was noted that reserves and mine locations served major
interior markets for gypsum and gypsum products but that economic
reserves do not exist to serve major markets in coastal areas of the
United States. These markets are served by importing crude gypsum from
mines in Nova Scotia and Mexico. Typically, about 35-40% of the require-
ments in the United States are imported annually. The Canadian mines
are by far the most important source of imported crude gypsum. Imported
material comes from mines located at or near the sea, and in many cases
it is loaded directly into ocean-going ships of up to 30-kton capacity
for shipment to domestic calcining plants that are equipped to off-load
directly into storage (38). In addition to manufacturing the full range
of gypsum products, these calcining plants also serve as distribution
points for shipping uncalcined gypsum to other users.
To summarize, gypsum markets may be supplied by crude gypsum that
is either mined domestically or imported. In addition, agricultural
markets may be supplied by gypsite mines and by byproduct gypsum from
phosphatic fertilizer manufacturing operations. Also, calcining plants
located in seacoast towns are considered supply points for cement and
agricultural markets since they serve as distribution points for imported
material in addition to performing their manufacturing operations. Of
course, each utility out of compliance is also considered a potential
supply point.
53
-------
1 <
1
Figure 6 . Location of domestic gypsum mines, 1975 (Mineral Industry Surveys)
-------
Since each calcining plant obtains its gypsum requirements from a
given integrated mining operation (supply point), a fixed supply point
has been designated for each calcining demand point. In the model no
other crude gypsum supply point is allowed to supply a given calcining
plant; only abatement gypsum can compete. Cement plants, on the other
hand, may be supplied by any gypsum supplier.
Supply Prices
It is impossible within the scope of this study to estimate mining
costs on an individual mine basis or on a regional basis. It has there-
fore been necessary to use average values for gypsum as reported by the
Bureau of Mines. It is known that calcining plants are supplied by
integrated mines but that most cement plants do not have integrated
sources of supply. There is little precedent upon which to draw to
anticipate how gypsum producers would react to lower cost alternatives,
other things being equal. The utility will prefer to dispose of his
total product to avoid the problem of stockpiling. Because of the
quantities of product involved, a calcining market is almost a necessity
for the utility if it is to avoid stockpiling. If the gypsum industry
negotiates for an abatement product only at its lowest mining cost, it
will reduce average revenue per ton that the utility might realize. If
the revenue anticipated by the utility is not sufficient to offset its
cost difference, the utility will not undertake the gypsum process.
This also has the effect of removing the utility from competition for
other existing markets.
There may be at least one exception to this line of reasoning.
Earlier, it was suggested that entry into the wallboard products manu-
facturing industry was effectively blocked, especially in the Eastern
States, by absolute costs. Abatement supplies would significantly alter
this picture. It is possible that current integrated gypsum producers
might actively bid for an abatement product in order to retain its
market share in a given area and maintain existing prices.
What may occur can only be conjecture. For purpose of the study on
a national basis it will be assumed that utilities must compete for
calcining markets at the lower cost alternatives that have been presented.
The supply data base, therefore, provides internal and external price
fields. Supply prices of crude gypsum to calcining plants, all of which
are integrated, will be based on internal prices. The internal price
reflects estimated variable cost of mining. Supply prices for cement
plants are based on the external or market price. All prices are f.o.b.
supply point and appropriate transportation cost is calculated from
supply to demand points. The lowest delivered cost under conditions
described becomes the cost with which abatement product must compete.
Specific supply prices for crude gypsum to be used in the analysis
are based on current information from the U.S. and Canadian Bureau of
Mines. Internal prices are based on an approximation of variable mining
55
-------
cost and external prices based on the reported average value per ton
sold to the cement market. The initial prices to be used are based on
conservative estimates of prevailing cost. If the analysis based on
conservative cost estimates justifies additional work, market solutions
may be developed by increasing price levels for both internal and exter-
nal prices.
According to information presented in a previous section the variable
cost of mining crude gypsum in Canada is estimated at $1.42/ton. Move-
ment to ports and loading onto cargo ships would be added cost to be
considered in estimating an f.o.b. price for imported material. Based
on this information a minimum price f.o.b. Canada and other import
sources is established at $2.00/ton and the maximum price is $5.00/ton.
Domestic mining costs vary widely but appear to be somewhat greater than
mining cost in Canada due to differences in quality of mines and higher
labor costs in the United States; internal prices f.o.b. domestic mines
are assumed at $3/ton minimum and $6/ton maximum.
External prices are based on average value per ton of gypsum sold
in the cement industry as reported by the Bureau of Mines. In 1974 that
figure was $5.94/ton (Table 17). A minimum external f.o.b. domestic
mine supply point price of $6.00/ton and a maximum price of $10.00/ton
are used. Calcining plants using imported materials also serve as
supply points for nearby cement and agricultural markets. External
prices from these supply points will be based on internal price f.o.b.
Canada, plus transportation cost, plus $2.00/ton handling charge.
No representation is made that these prices are definitive, but it
is felt that the range of prices used is indicative of the price situa-
tion that utilities would have to meet in order to market abatement
gypsum. The prices used should provide a good indication of the potential
for abatement gypsum production by the industry. The decision to produce
gypsum is an individual plant, not an industry, decision and the informa-
tion specific to that firm will be used in making the decision.
After f.o.b. prices are determined, appropriate transportation cost
is calculated to arrive at delivered cost of crude gypsum to each demand
point. All cement plants are assumed to receive gypsum requirements by
rail from either mines or utilities. Point-to-point mileage is calculated
through the use of a computer program (standard point location code).
In the case of imported material and mines located on the Great Lakes
that deliver crude gypsum to calcining plants, rates were not available.
Water transportation rates were assumed at $3.00/ton as far south as
Norfolk, Virginia; $4.00/ton to south Florida; and $5.00/ton to Gulf and
Pacific Coast locations. Since abatement gypsum contains approximately
20% free moisture as compared with approximately 3% free moisture in
crude gypsum, it is necessary to add 17% to the cost of rail transporta-
tion of abatement gypsum to equalize transportation costs.
56
-------
TABLE 17. GYPSUM USE AND VALUE BY MAJOR CONSUMING SECTOR
Average
Calcined, value, Cement,
Year
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
a. U.
ktons
10,437
9,820
9,019
9,227
10,657
9,797
9,360
10,035
10,519
10,326
10,112
9,826
9,313
10,391
10,861
9,953
12,291
14,217
14,917
12,841
10,390
S. Bureau
$/ton
3.18
3.31
3.25
3.38
3.59
3.63
3.68
3.65
3.67
3.64
3.73
3.70
3.66
3.67
3.88
3.12
3.75
3.93
4.18
4.41
4.51
of Mines,
ktons
2,226
2,394
2,273
2,416
2,757
2,543
2,763
2,765
2,898
2,986
3,152
3,372
3,154
3,439
3,464
3,358
3,386
3,924
4,148
4,058
3,244
Average
value ,
$/ton
3.92
4.02
4.21
4.23
4.30
4.42
4.27
4.47
4.46
4.52
4.62
4.62
4.66
4.66
4.58
4.74
4.78
4.94
5.35
5.94
6.25b
Agriculture,
ktons
678
830
830
1,021
1,188
1,126
1,088
1,241
1,262
1,270
1,265
1,276
1,280
1,388
1,100
804
1,124
1,146
1,453
1,671
1,482
Average
value ,
$/ton
3.39
3.37
3.76
3.30
3.09
3.29
3.50
3.40
3.46
3.52
3.68
3.96
4.27
4.48
4.85
5.27
4.79
5.21
5.09
7.62
8.00b
Minerals Yearbook.
b. Estimated.
57
-------
FGD COST COMPARISONS
Three gypsum-producing FGD systems, limestone-gypsum, Chiyoda
Thoroughbred 101, and Dowa aluminum sulfate, were chosen to be evaluated
in this study. Desulfurization costs for each of the three systems are
estimated and compared using simulated base case conditions. Also,
costs for the limestone slurry throwaway system originally developed by
TVA (9) are updated to the same base conditions. Investment and average
annual revenue requirements are projected for each system, including
limestone slurry, from base case premises. Nine other gypsum-producing
processes are mentioned briefly as potential alternatives for gypsum
production from FGD. The description of gypsum-producing systems and
the evaluation of four FGD systems are interesting in themselves as a
technological and economic comparison of alternative FGD methods.
Lifetime revenue requirements for the limestone slurry and limestone-
gypsum processes are calculated by use of a computer program developed
by TVA (39). These costs are used for the marketing portion of the
study.
To discuss and compare FGD processes, it is necessary to define a
common basis for reference. The base case established for this report
is used to determine investment costs and revenue requirements for the
four FGD processes listed above. Design conditions have been assumed so
that all processes have common basis for technical comparison. Elements
used in designing the base case are chosen because they represent typical
average conditions of the more modern boilers for which stack gas desul-
furization is most likely to be considered.
DESIGN PREMISES
Attention is focused on coal-burning power units for two reasons:
(1) coal will be the major fuel source for the next several years as
fuel oil and natural gas prices increase because of decreasing supplies,
and (2) coal, in comparison to other fossil fuels, is the source of
greatest pollution because it contains more ash, sulfur, chlorides,
nitrogen oxides, and trace elements which must be removed and disposed
of. Low-sulfur coals containing less than 0.8% sulfur are one answer to
S02 emission control but they are often unavailable or economically
unfeasible. A wide variety of coals, with sulfur ranges from a few
tenths of a percent to 5% or greater, will continue to be used in the
future for the production of electricity in this country. The coal
assumed for the base case in this study is bituminous, contains 3.5% sulfur
and 12% ash, and has a total heating value of 12 kBtu/lb.
59
-------
Coal-fired power plants are being built today in sizes up to 1300
MW, but older units of 200 MW and smaller will continue to be operated
for many years. The base case power plant is defined for this study as
a new 500-MW unit with a heat rate of 9 kBtu/kWh and an annual capacity
of 7 kkWh/kW. The assumed operating life of a new coal-fired power unit
is 30 years. A power plant operating schedule has been assumed for the
base case of this study which represents a total on-stream time of
127,500 hours over the plant life. Lifetime revenue requirements are
projected from this schedule which is shown in Table 18. This capacity
schedule corresponds to that which was used in the TVA cost study (9).
TABLE 18. ASSUMED POWER PLANT CAPACITY SCHEDULE
Operating Capacity factor, %
year (nameplate rating)
1-10
11-15
16-20
21-30
Average for
30-year life
80
57
40
17
48.5
Annual kWh/kW
capacity
7,000
5,000
3,500
1,500
4,250
Design premises for this report follow those outlined in TVA's
detailed cost study of five processes (9). A balanced-draft boiler
design is assumed. Flue gas composition is based on combustion of
pulverized coal with 20% excess air to the boiler and 13% additional air
inleakage at the air preheater. The following flue gas composition from
the boiler is used for the material balance.
Flue gas composition Vol, %
Nitrogen 74.55
Carbon dioxide 12.55
Oxygen 4.86
Water 7.76
S02 0.22
Nitrogen dioxide 0.06
Fly ash loading
Gr/sft3, dry 4.11
Gr/sft3, wet 3.79
It is assumed that 92% of the sulfur present in coal is emitted as
S02 and 75% of the ash is emitted as fly ash. Particulate removal is
carried out by electrostatic precipitators (ESP) designed for a removal
efficiency of 99.5%. A 500-MW power unit is assumed to have four econo-
mizers, air heaters, ESP, ducts, and ID fans.
60
-------
The fan is designed to overcome a pressure drop of about 15 inches
downstream of the boiler plus the additional pressure drop attributed to
S(>2 removal. Fully sized ID fans are included in the equipment list,
but costs for an equivalent 15-inch ID fan is subtracted from the total
cost as a boiler charge. Only costs for the incremental increase in fan
capacity needed by the addition of 502 removal is charged to the removal
process.
Proven design, not first-of-a-kind, is assumed for each system
evaluated and 90% S02 removal in the absorber is assumed for each case.
Bypass ducts for maintaining full power generation capacity during
shutdown of one or more scrubbing trains are not provided.
Stack gas reheat downstream of the absorber is required for plume
buoyancy. Cleaned gas exits the scrubber at about 125 F and is heated
by indirect steam reheaters before entering the fans. Heat of compres-
sion is added by the fans and the gas enters the stack at 175 F. Addi-
tional steam is provided to account for heating and evaporation of
entrained liquid in the gas.
Raw materials used in the four detailed processes are listed below.
1. Limestone
Purchase size:
Analysis:
0 x 1-1/2 inches
90% CaCOs (dry), 5% H20
Limestone ground as 60% solids slurry
Ground size:
Bulk density:
Storage capacity:
2. Sulfuric acid
Analysis:
Specific gravity:
Storage capacity:
3. Ferric sulfate
Analysis:
Bulk density:
Storage capacity:
4. Aluminum sulfate
Analysis:
Bulk density:
Storage capacity:
5. Manganese sulfate
Analysis:
Bulk density:
Storage capacity:
70% minus 200 mesh
95 lb/ft3
30 days
98% H2S04
1.831
60 days
20% trivalent iron
60 lb/ft3
15 days
50% A12(S04)3
50 lb/ft3
15 days
28% manganese
70 lb/ft3
purchased in bags
61
-------
Total land requirement for each process, excluding waste solids
disposal and gypsum stockpiling areas, is 9 acres. The limestone slurry
process from the TVA cost study (9) includes onsite disposal of waste
calcium solids. Adequate land is purchased initially to provide ponding
for the life of the plant. For the base case (new unit, 30-year operating
life) a 206-acre common disposal pond, 40 feet deep and clay lined, is
required for calcium solids and fly ash. Based on relative volume, 131
acres of the pond is charged to SC>2 removal. The gypsum-producing
processes are assumed to require 9 acres of land for temporary stock-
piling of the abatement gypsum.
COST PREMISES
Because of the concentration of coal-fired power plants and the
abundance of coal fields in the Midwestern States, this study assumes a
Midwest location for the power unit described. Land costs are assumed
at $3500/acre. Project design is assumed to begin in mid-1975 and
construction is assumed complete in mid-1978. Average cost basis for
scaling is mid-1977. Investment costs for each system start at the
plenum which feeds the absorbers; the cost of particulate removal is not
included in the study.
Direct investments are prepared using the following Chemical Engineering
projections (40) .
Year 1974
Material 171.2
Labor 163.3
1975
194.7
168.6
1976a
210.3
183.8
1977a
227.1
200.3
a. Projections.
Included in direct investment are equipment, installation, labor
and materials, land, utilities, services, and construction facilities.
In the limestone slurry and limestone-gypsum processes, detailed analysis
of the utilities and services areas has been made to project costs for
such items as piping, wiring, and process equipment. For the Chiyoda
and Dowa processes, process areas and land investment costs are totaled
and utilities and services are estimated as 0.5% and 5.0% of this cost
respectively. For all four processes, subtotal costs for equipment and
field materials for each process area and land, utilities, and services
are summed and construction facilities are estimated as 5% of this
subtotal.
Indirect investment includes engineering design and supervision,
construction field expense, contractor fees, and contingency. These are
estimated as a percentage of direct investment according to the following
list.
62
-------
Percentage of
Indirect investment cost direct investment
Engineering design and supervision 9
Construction field expense 11
Contractor fees 5
Contingency 10
Total 35
Allowance for startup and modification and interest during construc-
tion are each estimated at 8% of the fixed investment. A capital structure
of 50% debt - 50% equity is assumed. Additional capital investment
assumptions may be found in the TVA five process cost study (9).
Annual revenue requirements are based on 7000 hours of operation per
year. Removal and disposal of fly ash is considered a function of the
power plant and is not included in the FGD process evaluation. Charges
for raw materials, labor, and utilities are projected to 1978. Maintenance
costs are estimated as a percentage of direct investment; the percentage
is varied according to the complexity of the process operations and
equipment selected.
Water treatment is given partial coverage in the economics of each
process. No investment area is developed for the cleaning and recycle
of a water purge stream. A nominal $1.20/kgal is included in the revenue
requirements to acknowledge the future need for this treatment.
Projected 1978 costs for raw materials, labor, and utilities are
listed in Table 19.
Economics for each process are evaluated on a regulated power
industry basis. Depreciation, capital charges, and overheads are
estimated on a basis similar to that presented in the TVA five process
cost study (9), where a more thorough discussion of revenue requirements
may be found.
Working capital is estimated as the equivalent cost for 3 weeks
of raw materials, 7 weeks of direct operating costs, and 7 weeks of
overheads. It is listed in the notes at the bottom of the revenue
requirements page, but is not included in total capital investment.
Lifetime economics have been projected for this report using the
declining-load factors described in Table 18. Year-by-year costs are
calculated by computer using the same method as is used for calculating
the year-one annual revenue requirements, with the exception that capital
charges decline annually proportional to the amount depreciated. Unit
costs of raw materials, utilities, labor, and analyses remain constant
at 1978 dollars.
63
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TABLE 19. PROJECTED 1978 UNIT COSTS FOR
RAW MATERIALS, LABOR, AND UTILITIES
Raw materials
Limestone
Sulfuric acid
Ferric sulfate
Aluminum sulfate
Manganese sulfate
Labor
Operating labor
Analyses
Utilities
Steam
Process water
Electricity
Water treatment
$/unit
6.00/ton
54.00/ton
85.00/ton
150.00/ton
0.065/lb
10.00/man-hr
15.00/man-hr
1.40/klb
0.11/kgal
0.027/kWh
1.20/kgal
PROCESS DESCRIPTIONS
Simply stated, a limestone scrubbing system contacts flue gas with
limestone slurry in an absorption chamber to remove S02« Cleaned gas
flows to the stack and the calcium-sulfur compounds formed by the absorption
of S0Ł by limestone are discarded in a disposal pond. To reclaim the
sulfur in S02 in a potentially usable form, several systems have been
designed which combine the flue gas S02 with calcium to form gypsum,
CaSO/«2H20, a useful and environmentally more acceptable product than
throwaway sludge. For gypsum production, such operations as oxidation,
reaction with limestone outside the absorber, and separation of gypsum
have been added to the scrubbing operation. These additional process
steps can be carried out in several ways.
Three processes which produce gypsum have been selected for evalua-
tion in this study. TVA engineers have developed a conceptual process
design which combines the basic limestone scrubbing system with oxidation
technology developed in Japan. Chiyoda's Thoroughbred 101 FGD system,
developed and commercially available in Japan, combines absorption and
oxidation in one vessel. The Dowa process, a commercial Japanese FGD
system, is similar to U.S. double alkali processes except that it uses
limestone to produce gypsum and scrubs with aluminum instead of sodium
salts.
64
-------
Complete process descriptions including flowsheet and material
balance are reported for the limestone slurry, limestone-gypsum, Chiyoda,
and Dowa processes. Brief summaries of process operation and simplified
process diagrams are outlined for nine additional FGD gypsum-producing
systems .
Limestone Slurry Process
The limestone slurry process for desulfurization of flue gas,
Figures 7 and 8, is based on the process outlined in Detailed Cost Estimates
For Advanced Effluent Desulfurization Processes (EPA-600/2-75-006 ;
PB 242.541/1WP, January 1975) with modifications to use an ESP rather
than a wet scrubber for upstream removal of fly ash. Simplified process
chemistry includes the following reactions:
-> CaS03-l/2H20 + C02 +
The general process description is given below to simplify comparison of
this process with the limestone-gypsum process which is discussed later.
Makeup limestone slurry from the feed preparation area is combined
with scrubber effluent slurry and recycle pond water to control the
concentration of the recirculating slurry at about 10% solids. This
slurry is circulated through mobile-bed absorbers where it reacts with
the S02 in the flue gas. The absorbers are equipped with chevron-type
entrainment separators with provisions for upstream wash with fresh
makeup water to control entrainment carryover in the gas stream. A
bleedstream from the effluent hold tank is fed to the pond feed tank and
the spent slurry is pumped to the onsite pond where the solids in the
slurry settle to form a sludge containing about 40% solids. Pond
supernate is recycled to the wet ball mills and the absorber effluent
hold tank to maintain closed-loop operation. Scrubber outlet gas is
reheated by indirect steam reheat and passed through the ID fans before
entering the stack.
Minor adjustments were made to the reheater and gas-handling area
design and costs from the initial study to reflect the changes associated
with utilization of an ESP for particulate removal.
j^imestone-Gypsum Process
The limestone-oxidation to gypsum process evaluated in this study,
Figures 9 and 10, is a conceptual design to be used for comparison with
other gypsum-processing processes. The process scrubbing area is similar
in design to the scrubbing area for the limestone process. Downstream
of the scrubbers, however, oxidation and filtration equipment (based on
technology developed in Japan) have been added for conversion of the
65
-------
SLUBttY PUMF*
TAWWL
Figure 7. Limestone slurry process. Flow diagram.
-------
STREAM NO
DESCRIPTION
RATE, LBS /HR.
SCFM
6PM
PART ICULATES, LBS. /HR,
TEMPERATURE , • f.
SPECIFIC GRAVITY
UNDISSOLVED SOLIDS, %
NO OF STREAMS
1
COAL
TO
BOILER
375K
1
2
COMBUSTION
AIR TO
AIR HEATER
4.5I8K
964K
no
i
3
COMBUSTION
AIR TO
BOILER
4.075K
868K
535
1
4
GAS
TO
ECONOMIZER
4404 K
943K
33. 7K
890
1
5
GAS
TO
AIR HEATER
4.404K
943K
33.7K
705
1
6
GAS TO
ESP (995%)
I.2I2K
260 K
8,435
310
4
7
GAS
TO
ABSORBER
I.2I2K
260K
422
310
4
a
GAS
TO
REMEATER
I.262K
290K
559
129
4
9
GAS
TO
FAN
I.262K
290K
55 9
163
4
10
GAS
TO
ATMOSPHERE
3,048*
I.I6IK
224
175
1
1 1
STEAM
TO GAS
REHEATER
I7.6K
470
4
12
MAKE-UP
WATER TO S02
ABSORBER
81. 4K
163
4
13
POND WATER
TO
A.E. H.T.
77. 3K
155
4
STREAM NO.
DESCRIPTION
RATE, LBS /HR.
SCFM
GPM
PARTICULATES, LBS./HR
TEMPERATURE , • F.
SPECIFIC GRAVITY
UNDISSOLVED SOLIDS, %
NO. OF STREAMS
14
LIMESTONE
TO WEIGH
FEEDER
25K
2
15
SLURRY TO
MILLS
PRODUCT TANK
39 6 K
480
165
60
2
16
LIMESTONE
SLURRY TO
A.E. H.T.
19. 8K
240
4
17
RECYCLE
SLURRY TO
S02 ABSORBER
II.99M
22. BK
4
18
S02 ABSORBER
SLURRY TO
A E.H.T.
I2.07M
23K
4
19
A.E H.T,
OVERFLOW TO
POND FEED TK.
177 K
319
l.ll
10
4
20
USED SLURRY
TO SETTLING
POND
708K
1276
1
21
SETTLED
USED
SLURRY
I80K
277
1.3
40
1
22
RECYCLE
POND
WATER
500 K
1000
1
23
POND WATER
TO WET
BALL MILL
14.6 K
29.2
2
Figure 8. Limestone slurry process. Material balance.
-------
oo
Figure 9. Limestone-gypsum process. Flow diagram.
-------
STREAM NO
DESCRIPTION
RATE LBS/HR
3CFM
GPM
PARTICULATES LBS/HR
TEMPERATURE 'F
SPECIFIC GRAVITY
UNDISSOLVED SOLIDS, %
NO OF STREAMS
1
COAL
TO
BOILER
375 K
1
2
COMBUSTION
AIR TO
AIR HEATER
4SIBK
984K
1 10
1
3
COMBUSTION
AIR TO
BOILER
407SK
B88K
555
1
4
GAS TO
ECONOMIZER
4404K
943K
33.7 K
890
1
5
GAS TO
AIR HEATER
4404K
943K
33.7K
705
1
6
GAS TO
ESP (995W
I2I2K
260K
8435
310
4
T
GAS TO
ABSORBER
I2I2K
260K
42 2
310
4
e
GAS TO
REHEATER
282 K
Z95K
55 9
125
4
9
GAS TO
FAN
I282K
295K
55.9
165
4
IO
GAS TO
ATMOSPHERE
5I29K
II79K
224
175
1
II
STEAM
I88K
470
4
12
ABSORBER
SLURRY
EFFLUENT
I2094K
22 K
125
I.I
15
4
13
ABSORBER
SLURRY TO
HOLD TANK
I1996K
21 8K
125
I.I
15
4
STREAM NO
DESCRIPTION
RATE LBS/HR
SCFM
GPM
PARTICULATES LBS/HR
TEMPERATURE 'F
SPECIFIC GRAVITY
UNOISSOLVED SOLIDS, %
NO OF STREAMS
14
ABSORBER
BLEED TO
NEUTRALIZES
98. 3K
179
125
I.I
15
4
15
H2S04 TO
NEUTRALIZER
6.9K
7.5
77
1831
1
16
NEUTRALIZED
SOLUTION TO
OXIDIZER
400K
714
125
112
15
1
17
AIR TO
OXIDIZER
84. 9K
20*
60
1
18
OXIDIZER
OFF GAS TO
ABSORBER
20. 3K
4 8K
125
4
19
OXIDIZER
EFFLUENT
SLURRY
806.6K
1428
125
1
20
RECYCLE
SLURRY TO
OXIOIZER
403.4 K
714
125
1
21
OXIDIZER
BLEED TO
THICKENER
403.4 K
714
125
1 13
15
1
22
THICKENER
UNDERFLOW
TO FILTER
98.7*
159
60
1.29
35
2
23
THICKENER
OVERFLOW
SI.5K
103
60
10
0
4
24
WASH
WATER TO
FILTER
30K
60
60
1.0
0
2
25
FILTER CAKE
TO BIN
430K
60
80
2
STREAM NO
DESCRIPTION
RATE LBS/HR
SCFM
GPM
PARTICULATES LBS/HR
TEMPERATURE 'T
SPECIFIC GRAVITY
UNOISSOLVEO SOLIDS, N
NO. OF STREAMS
26
FILTRATE
RETURN
S5BK
110
60
10
0
2
27
FILTRATE TO
ABSORBER
HOLD TANK
20 6K
41,2
60
1.0
0
4
28
FILTRATE TO
BALL MILL
145k
29
60
1.0
0
2
29
THICKENER
OVERFLOW
TO PURGE
22 IK
44 3
60
1 0
0
4
30
LIMESTONE
TO WEIGH
FEEDER
24 6K
a
31
SLURRY TO
MILLS
PRODUCT TANK
390K
49
1.61
60
2
32
SLURRY TO
ABSORBER
HOLD TANK
- I95K
245
60
161
60
4
33
MAKE-UP
WATER
637K
(27,3
60
1.0
0
4
34
RECYCLE TO
ABSORBER
I2080K
21 9K
125
I.I
IS
4
35
OVERFLOW
TO ABSORBER
HOLD TANK
29.4K
58 8
60
1.0
,0
4
36
RECYCLE TO
ABSORBER
HOLD TANK
44.4K
68.8
60
1.0
0
4
Figure 10. Limestone-gypsum process. Material balance.
-------
calcium sulfite in the slurry to gypsum. Simplified process chemistry
includes the following reactions.
H SO + CaCO •* CaSO -1/2H 0 + C09 + 1/2H 0
^- -J -J J Ł• 6m Ł•
H0SO. + CaCO_ + H00 -»• CaSO ,'2H_0 + C00
24 32 42 2
CaSO -1/2H.O + 1/20_ + 3/2H00 -> CaSO '2H00
j 2 2 2 42
A bleedstream from the scrubber effluent hold tank is fed to a
neutralization reactor where it is contacted with 98% H2S04 to (1)
convert excess CaCO^ in the slurry to CaSO^^t^O and (2) lower the pH of
the stream to approximately 4.0-4.5 to facilitate downstream oxidation.
Sulfuric acid at an H2S04:CaC03 stoichiometry of approximately 0.75 is
added. The reaction byproduct is fed to a high-pressure oxidizer where
the slurry is contacted with air to oxidize CaS03«l/2H20 to CaSO^-ZI^O.
Because of blinding of the limestone by CaSO^-ZI^O formation on the
exterior of the CaC03 particles and the low H2S04:CaC03 stoichiometry
used, tests have shown that the resulting slurry cake contains about 6%
unreacted CaC03. Since wallboard- or cement-quality gypsum contains up
to 15% CaC03, with the nominal grade containing between 8-15% CaC03,
the product gypsum should be acceptable for wallboard. During the
dewatering step the pH of the slurry gradually increases to about 6.0
due to buffering from the unreacted limestone.
Oxidation of CaS03-l/2H20 to CaSO^-ZI^O is affected by temperature,
pressure, pH of the slurry, and the size of air bubbles. A stoichiometry
of 3.0 mols 0Ł per mol 803 is used for oxidation. A rotary diffuser
breaks the air into small bubbles, thereby increasing the liquid-gas
contact area. Oxidation occurs at a temperature of about 125 F and a
pressure of 50-100 psig.
The effluent from the oxidizer is fed to a thickener to increase
the concentration of solids in the slurry and facilitate dewatering.
The thickener is smaller than that needed for a sulfite-sulfate sludge
due to the excellent settling characteristics of the CaSO^-ZI^O. Since
the retention time of the slurry in the thickener is about 44 hours ,
the unreacted limestone in the slurry acts as a buffer and the pH of the
liquor increases to about 6-7. The filtration equipment can then be
constructed of common materials. Also, the pH of the waste stream is
more acceptable.
A purge stream is removed from the thickener overflow tank for
treatment to remove soluble chloride ions and other trace elements to
prevent a buildup of these process contaminants in the processing streams,
A reverse osmosis water treatment process is used.
70
-------
The gypsum is separated from the thickener underflow using a hori-
zontal belt filter. This filter is capable of producing a gypsum cake
containing over 80% dry solids and is designed with a wash section. The
cake is composed of 94% CaSQ^•2H20 and 6% CaC03 on a dry basis. The
American Society for Testing and Materials has imposed limitations on
the quality of soluble impurities in the dry gypsum of 0.05% by weight.
The wash section of the filter is capable of reducing the quantity of
soluble impurities to this level. In closed-loop operation the thickener
overflow and filter hold tank water is recycled back to the absorber
hold tank and the wet ball mill.
Chiyoda Thoroughbred 101 FGD Process
The Chiyoda process, Figures 11 and 12, uses dilute (2-3%) sulfuric
acid as the SC>2 scrubbing liquor. A bleedstream from the absorber is
neutralized with limestone slurry and gypsum is precipitated. Simplified
process chemistry includes the following reactions.
Absorption: SO + HO -> H So
Oxidation: H.SO. + 1/200 -> H.SO.
23 224
Neutralization: H0SO. + CaC00 + H00 -> CaSO.•2H00 + C00
2. 4 32 42 2
Flue gas flows from the air heater to an ESP where an assumed 99.5%
of the fly ash is removed. The gas then enters the absorber near the
bottom and flows upward through the outer chamber of the vessel. Cleaned
gas leaves the absorber through a mist eliminator and passes through a
reheater before leaving the stack.
The Chiyoda absorber is designed with a center column which functions
as the oxidation tower. Liquor containing the absorbed S02 as sulfurous
acid, I^SOj, is pumped from the bottom of the outer chamber into the
bottom of the oxidation chamber and flows upward cocurrently with the
injected air. In the presence of the ferric sulfate catalyst, ^503 is
completely oxidized to sulfuric acid. The rich liquor overflows the top
of the oxidizer column and returns to the bottom of the vessel through
the outer chamber.
A bleedstream of rich liquor is reacted with limestone in a Chiyoda-
designed crystallizer to form gypsum crystals. Only partial neutralization
is allowed; complete neutralization results in precipitation of the
ferric ion as ferric hydroxide. Gypsum formed in the crystallizer is
separated by a rotary drum filter and a product of 80% solids is conveyed
to the storage-shipping area. Liquor from the crystallizer and the
filter is clarified in a thickener and returned to the absorber.
Thickener underflow is recycled to the crystallizer. A wastewater purge
is included in the process to control chlorine buildup and protect the
absorber from corrosion.
71
-------
^ n tHlfP,H6
^~*M sroRtee
Figure 11. Chiyoda Thoroughbred 101 FGD process. Flow diagram.
-------
STREAM NO
DESCRIPTION
RATE , IBS/ HR
SCFM (60'F)
GPM
PARTICULATES, LBS/HR
TEMPERATURE , 'f
SPECIFIC GRAVITY
UNDISSOLVED SOLIDS,'/.
NO OF STREAMS
1
COAL
TO
BOILER
375*
1
2
COMBUSTION
AIR TO
AIR HEATER
4.5I8K
984K
MO
1
3
COMBUSTION
AIR TO
BOILER
4.071K
888K
535
1
•»
GAS TO
ECONOMIZER
4.404K
943K
33 7K
690
I
S
GAS TO
AIR HEATER
1.404K
943K
33 7K
705
1
e
GAS TO
ELECTROSTATIC
PRECIPITATOR
I.2I2K
26CK
8,435
310
4
T
I3AS TO
ABSORBER
I.2I2K
260*
42 2
310
4
8
CAS TO
REHEATER
I,275;K
26'K
42 2
125
4
9
GAS TO
FAN
1,275 5K
29IK
42 2
164
4
IO
GAS TO
STACK
5.I02K
28iK
1688
175
1
II
STEAM
TO GAS
REHEATER
I82K
470
4
12
MAKEUP
WATER TO
ABSORBER
54,830
110
4
13
AIR TO
OXIDIZER
16,730
3,665
4
STREAM NO
DESCRIPTION
RATE , IBS/ HR
SCFM (60'F)
GPM
PARTICULATES, LBS/HR
TEMPERATURE , *F
SPECIFIC GRAVITY
UNDISSOLVED SOLIDS, %
NO Oc STREAMS
14
SULFURIC ACID
BLEED TO
CRYSTALLIZES
577,850
1,143
1 01
4
15
LIMESTONE
TO WEIGH
FEEDER
17,800
2
16
MAKEUP
WATER TO
BALL MILL
2,000
4
2
17
CLARIFIED
UNDERFLOW
10 BALL MILL
9,900
20
1.01
2
18
SLURRY TO
MILLS
PRODUCT TANK
59,400
74
1.61
60
1
19
LIMESTONE
SLURRY TO
CRYSTALLIZER
14,850
IB
1.61
60
4
2O
CLARIFIES
UNDERFLOW TO
CRYSTALLIZES
12,500
25
1. 01
4
21
CRYSTALLIZER
OVERFLOW TO
CLARIFIER
1,097,000
2,170
1.01
2
22
UNDERFLOW
TO FILTER
FEED TANK
56,700
99
1.15
25
4
23
GYPSUM
CAKE TO
STORAGE /SHIP
35,500
80
2
24
FILTRATE
TO •
CLARIFIER
77,900
154
1.01
2
25
SCRUBBING
LIQUOR TO
ABSORBER
570,000
1,139
1.0
4
Oo
STREAM NO
DESCRIPTION
RATE . LBS/HR
SCFM
OHM
PARTICULATES LBS/HR
TEMPERATURE , "F
SPECIFIC GRAVITY
UNDISSOLVEO SOLIDS, %
NO OF STREAMS
26
CATALYST
MAKEUP
145
1
27
WATER TO
CATALYST
TANK
210
0 4
1
Figure 12. Chiyoda Thoroughbred 101 FGD process. Material balance.
-------
The flowsheet and the detailed engineering for this evaluation were
done by TVA in compliance with the premises outlined in this report for
the purpose of comparison with the other selected processes. System
capital and operating costs are dependent on the design premises made by
TVA; however, these premises do not necessarily match those made by
Chiyoda in optimizing flow rates and design conditions for a specific
application. As an example, Chiyoda would design a 500-MW unit with two
rather than four scrubbing trains, would use a prescrubber, and would
not use indirect steam reheat. Certain process information is considered
by Chiyoda to be proprietary and has been deleted from the report.
The Chiyoda Thoroughbred 101 process (CT-101) was developed by
Chiyoda Chemical Engineering and Construction Company, Ltd., Yokohama,
Japan. Currently, there are 15 commercial installations in Japan,
treating gas from oil-fired utility boilers, Glaus sulfur plants, and
industrial waste incinerators. A 23-MW-equivalent-capacity demonstration
unit operates at Scholz Steam Plant, Sneads, Florida, a utility of Gulf
Power Company. The process is available in the United States through
Chiyoda International Corporation, Seattle, Washington.
Chiyoda began lab tests for an advanced FGD system in October 1975.
Named Chiyoda Thoroughbred 121 (CT-121), the process combines absorption,
oxidation, and crystallization into one reactor vessel. There is no
process chemistry change involved.
The integrated vessel design replaces the CT-101 absorber-oxidizer
with a flue gas bubbling contact zone which is placed on top of the CT-
101 crystallizer. Claims made by Chiyoda for their new system include
lower investment cost and less energy required for operation.
Dowa Aluminum Sulfate-Gypsum Process
Double-alkali systems use a soluble reactant to absorb S02 from
flue gas and a second alkali (lime or limestone) to precipitate the
absorbed S02- Introduction of lime or limestone outside the absorption
chamber reduces the scaling that is a problem in direct lime-limestone
slurry scrubbing.
The Dowa process, Figures 13 and 14, is a double-alkali scrubbing
system that uses aluminum sulfate solution to absorb the S02 and lime-
stone slurry to precipitate gypsum and regenerate the aluminum sulfate
liquor. Simplified process chemistry includes the following reactions.
Absorption: Al^SO^-Al^ + 3S02
Oxidation: A12(S04)3'A12(S03)3 + 3/202
Neutralization: 2A12(S04>3 + 3CaC03
3CaS04-2H20 (gypsum) + 3C02
74
-------
Figure 13. Dowa aluminum sulfate-gypsum process. Flow diagram.
-------
STREAM NO,
DESCRIPTION
RATE.LBS/HR
SCFM |60'F)
6PM
PARTICULATES,IBS/HR.
lEVlPERATU.U , 'F
SPECIFIC GDAVITV
USDIDiOUVEO SOLIDS,%
NO OF STREAMS
1
COAL
TO
BOILER
375K
1
2
COMBUSTION
AIR T(J
AIR HEATER
4,5I8K
984K
ilO
1
3
C.OVBUSTK.N
AIM TO
BOILER
4.07SK
seen
535
1
4
GAS TO
ECONOMIZER
4,404K
94iK
337K
890
1
5
GAS TO
AIR HEATER
4,4Q4K
943K
33,-K
705
;
6
GAS TO
ELECTROSTATt
PRECIPITATOH
1,212*
260K
8,435
310
4
7
GAS TO
ABSORBER
1,212 K
260K
42.2
310
4
8
GAS TO
REHEATEK
I.2TS.5K
2BIK
42.2
125
4
9
GAS TO
FAN
I,2T5.SK
ZBlK
42.2
164
4
10
6A8 TO
3TACK
S.IOIK
zeiK
168.8
179
1
II
STEAM
TO GAS
REHEATER
18.2 K
470
4
12
ALUMINUM
SUUFATE (50%)
TO SOLN.TANK
S60
1
13
MAKEUP H,0
TO AMSO/j
SOLH. TAW
600
1.2
1
STREAM NO
DESCRIPTION
RATE,LBS/HR.
SCFM I60'F]
GPM
PARTICULAfES, LBS/HR.
IE \4PERA tu.^f. , •(
SPECIFIC onAvn^r
UNOI^OLVEO SOHDS,%
NO. OF STHtAMS
14
Alj(SO«)j
SOLUTION TO
HOLD TANK
1,100
1,7
1.29
1
15
ABSORBER
SOLUTION TO
HOLD TANK
0
0
1.2
4
16
SOLUTION
TO
OXIDATION
a
a
1.2
4
17
AIR TO
COMPRESSOR
8,375
1,840
4
18
VENT FROM
OXIDATION
7,380
I.6ZO
4
19
SOLUTION
TO
ABSORBER
a
a
4
20
SOLUTION
TO FIRST
NEUT. TANK
a
a
1
21
LIMESTONE
TO WEIGH
FEEDER
35,600
1
22
MAKEUP
WATER TO
BALL MILL
20,800
42
1
23
LIMESTONE
SLURRY TO
NEUT. TANK
56,400
70
1 .61
60
1
24
GYPSUMSOIRRV
TO SECOND
NEUT. TANK
a
0
1,23
I
25
GYPSUM
SLURRY TO
THICKENER
a
0
1.24
1
STUEAM HO.
INSCRIPTION
NME.LBSj'HR.
SCTM (60'F)
CiPM
PARTICIPATES LBS/HR.
TEMPERATURE , *F
SPECIFIC GRAVITY
UNDISSOLVEO SOLIDS. %
NO. Of STREAMS
26
OVERFLOW
FROM
HOLD TANK
0
0
1.21
1
27
UNDERFLOW
TO
FILTER
190,000
270
30
1
28
WASH
WATER
TO FILTER
16,000
21
2
29
GYPSUM
CAKE TO
SHIPPING/9TGE
71.200
80
1
30
FILTRATE
FROM
FILTER
a
a
1.2
2
31
SCRUBBING
LIOUOR TO
ABSORBER
a
a
1.2
4
32
LIMESTONE
SLURRY TO
Mg PURSE
a
a
1 61
60
1
3J
BLEED STREAM
TO MO PURGE
TANK
a
a
1
34
PURGE
STREAM TO
DISPOSAL
a
a
1
3S
WATER TO
INTERCOOLER
20,900
42
4
36
MAKEUP
H20 TO
ABSORBER
64,500
122
4
Figure 14. Dowa aluminum sulfate-gypsum process. Material balance.
-------
Flue gas is taken from the air preheater to an ESP where 99.5% of
the fly ash is removed. The gas then enters the absorber near the
bottom and flows upward through the tower. The aluminum sulfate solution
flows countercurrently to the gas and the aluminum sulfate reacts with
the SC>2 to form an aluminum sulfate-sulfite compound. The scrubbed gas
leaves through a mist eliminator and passes through a reheater before
leaving the stack.
The S02~rich absorber solution flows to a hold tank from which it
is pumped to an oxidizer. Excess air is sparged through specially
designed nozzles in the oxidizer to convert sulfite to sulfate. Most
of the oxidized solution is recycled to the absorber.
A bleedstream from the oxidizer is fed to the first of two neutral-
izing tanks in series where limestone as a 15% slurry is introduced to
react with aluminum sulfate. Gypsum is produced in these tanks and the
aluminum sulfate-oxide solution is regenerated for recycle to the absorber.
The gypsum slurry is pumped to a thickener where it settles to a
concentration of 30% solids. The thickener underflow is dewatered in a
rotary drum filter to produce a gypsum cake of 80% solids which can be
either stockpiled or shipped directly. Filtrate, cake wash water, and
thickener overflow are returned to the absorber.
Both magnesium and chloride buildup in the liquor must be avoided
for successful operation of the process. Magnesium contamination from
the limestone, while not affecting SC>2 absorption, reduces the quality
of the gypsum produced. Chlorides enters the system from coal and from
makeup water and is a potential problem that can range from corrosion of
the FGD process equipment to weakening of the finished wallboard.
To solve the problem of these impurities, Dowa has built a purge or
de-magnesium unit into its process. About 2% of the bleedstream to the
neutralizer is diverted to a purge tank. Limestone is added and gypsum
and aluminum hydroxide are precipitated. Magnesium remains in solution
and is pumped from the tank overflow to the wastewater treatment area.
Underflow from the tank is pumped to the main neutralizing tank where
the aluminum hydroxide dissolves and is reused as scrubbing liquor.
The flowsheet and the detailed engineering for this evaluation were
done by TVA in compliance with the premises outlined in this report for
the purpose of comparison with the other selected processes. System
capital and operating costs are dependent on the design premises made by
TVA; however, these premises do not necessarily match those made by Dowa
in optimizing flow rates and design conditions for a specific application.
Certain process information is considered by Dowa to be proprietary and
has been deleted from the report.
The Dowa aluminum sulfate process was developed by the Dowa Mining
Company, Ltd., Tokyo, Japan. The process is commercially operational at
five Japanese locations treating gas from a molybdenum sulfide roaster,
77
-------
a sulfuric acid plant, an antimony sulfide converter, an oil-burning
boiler, and an iron ore sintering plant. Universal Oil Products, Inc.,
(UOP) Des Plaines, Illinois, is presently negotiating a licensing agree-
ment with Dowa to manufacture and sell the Dowa system in the United
States.
Other Gypsum-Producing Processes
Nine additional alternative gypsum-producing processes are discussed
in Appendix A to give a more complete understanding of the variety of
systems available for recovering S(>2 as marketable gypsum.
ECONOMIC EVALUATION AND COMPARISON
Using the premises outlined previously for base case conditions,
investment and revenue requirements have been estimated for limestone
slurry, limestone-gypsum, Chiyoda, and Dowa. Several methods for
displaying cost results are included.
Capital Investment
Investment estimates include an itemized equipment list, area
breakdown, and investment summary for each process. Itemized equipment
lists, divided into process areas, are presented in Appendix B, Tables
B-l through B-4. Costs are estimated in 1977 dollars and are derived
from vendor contacts, actual TVA purchase costs for similar process
equipment, and authoritative publications of estimating standards.
These equipment lists are useful for providing equipment cost breakdowns
for the investment summaries and may also be used for comparing alterna-
tive process equipment specifications from process to process. As an
illustration, absorber descriptions including materials of construction
from the four equipment lists are tabulated below.
Process Item No. Description
Limestone Turbulent contact 4 S02 absorber, mobile bed, with
slurry absorber (TCA) demister, 41 ft long x 13 ft wide
x 41 ft high; 1/4-inch carbon steel
with neoprene lining; 316SS grids,
high-density polyethylene spheres,
FRP spray headers, chevron-vane
mist eliminators
Limestone- TCA 4 Same as limestone
gypsum
Chiyoda Chiyoda 4 S02 absorber-oxidizer, 45 ft diam-
absorber-oxidizer eter outer chamber x 15 ft diam-
eter inner chamber x 85 ft high,
vertical double shell, 316L SS;
polypropylene grid, 3-1/2 inch
Tellerette packing, polypropylene
mist eliminator
Dowa TCA 4 Proprietary
78
-------
Area-by-area summaries showing equipment and installation costs for
each process are displayed in Appendix B, Tables B-5 through B-8.
Installation expense includes a labor charge for installing each equip-
ment unit plus installation costs for piping, ductwork, concrete, excavation
and site preparation, structures, electrical equipment, instrumentation,
buildings, and painting. Also included are land, utilities, services,
and construction facilities.
For the limestone slurry and limestone-gypsum processes, installation
expenses are determined individually based on detailed layout drawings
and projected erection labor requirements. For the Chiyoda and Dowa
processes, installation expenses are determined as a percentage of
equipment cost based on projected erection labor requirements from TVA
construction experience and from the literature. Although equipment
costs are higher for the gypsum processes, the total investment is lower
for two of the three processes assuming that the abatement gypsum is
marketable and disposal ponds are not required. Storage of gypsum over
the life of a 500-MW power unit burning 3.5% sulfur coal would require
up to 100 additional acres, presenting a similar problem to that of
disposing of waste solids in limestone-lime scrubbing.
Total investment requirements are summarized for each process in
Tables 20-23 and a comparison of total investment in dollars and unit
investment in dollars per kilowatt for the four processes is given in
Table 24. Total capital investment ranges from $24,394k ($49/kW) to
$40,531k ($81/kW).
The effect of power unit size on total capital investment is shown
in Figure 15 for the limestone slurry and limestone-gypsum processes. A
200-MW power unit scrubbing with limestone slurry requires investment of
$14,400k , while a 1000-MW power unit requires $44M investment for the
same scrubbing process. The sensitivity of the limestone-gypsum process
to variations in power unit size and sulfur content of coal is shown in
Figure 16. Sulfur contents displayed are 2, 3.5, and 5% and result in
investment requirements at 500-MW of $22,600k, $25,600k, and $28,100k
respectively. The relationship for limestone slurry is similar.
Revenue Requirements
Revenue requirements are displayed as first-year summaries for each
of the four processes and lifetime revenue requirements for the limestone
slurry and limestone-gypsum processes. The annual summaries, based on
7000 hours of operation, are displayed in Tables 25-28. In Table 29 a
comparison is made of total dollars of annual revenue requirements and
unit revenue requirements expressed in mills/kWh, c/MBtu heat input, and
$/ton coal burned, per ton sulfur removed, and per ton gypsum produced.
The first-year annual revenue requirements excluding credit from sale of
byproduct gypsum range from $10,105,300 to $15,483,400/year (2.89 mills/kWh
to 4.42 mills/kWh).
79
-------
TABLE 20. LIMESTONE SLURRY PROCESS
SUMMARY OF ESTIMATED FIXED INVESTMENT3
(500-MW new coal-fired power unit, 3.5% sulfur in fuel,
90% S02 removal, onsite solids disposal, 1977 cost basis)
Limestone receiving and storage (hoppers, feeders,
conveyors, elevator, bins, dust collecting and bag
filter systems)
Feed preparation (feeders, crushers, elevators, ball
mills, tanks, agitators, pumps, dust collecting
system, and hoist)
SO-) scrubbers and ducts (4 TCA scrubbers including
mist eliminators, effluent hold tanks, agitators,
pumps, common feed plenum, and exhaust gas ducts to
inlet of fan)
Stack gas reheat (4 indirect steam reheaters and
soot blowers)
Gas handling (4 fans including exhaust gas ducts and
dampers between fan and stack gas plenum)
Calcium solids disposal (onsite disposal facilities
including feed tank, agitator, slurry disposal
pumps, pond, liner, and pond water return pumps)
Land (140 acres)
Utilities (instrument air generation and supply
system, plus distribution systems for obtaining
process steam, water, and electricity from the
power plant)
Service facilities (buildings, shops, stores, site
development, roads, railroads, and walkways)
Construction facilities
Subtotal direct investment
Engineering design and supervision
Construction field expense
Contractor fees
Contingency
Subtotal fixed investment
Allowance for startup and modifications
Interest during construction (8%/annum rate)
Total capital investment
Investment, $
% of subtotal
direct
investment
571,000
1,234,000
6,216,000
797,000
1,977,000
5,136,000
490,000
93,000
877,000
870,000
18,261,000
1,643,000
2,009,000
913,000
1.826.000
24,652,000
1,972,000
1.972.COO
28,596,000
3.1
6.8
34.0
4.4
10.8
28.1
2.7
0.5
4.8
4.8
100.0
9.0
11.0
5.0
10.0
135.0
10.8
10.8
156.6
Basis
Stack gas reheat to 175 F by indirect steam reheat.
Disposal pond located 1 mile from power plant.
Midwest plant location represents project beginning mid-1975, ending mid-1978.
Average cost basis for scaling, mid-1977.
Minimum in-process storage; only pumps are spared.
Investment requirements for removal and disposal of fly ash excluded.
Construction labor shortages with accompanying overtime pay incentive not
considered.
80
-------
TABLE 21. LIMESTONE-GYPSUM PROCESS
SUMMARY OF ESTIMATED FIXED INVESTMENT3
(500-MW new coal-fired power unit, 3.5% sulfur in fuel,
90% S09 removal, 1977 cost basis)
Material handling (hoppers, feeders, conveyors, ele-
vator, bins, dust collecting and bag filter systems)
Feed preparation (feeders, crushers, elevators, ball
mills, tanks, agitators, pumps, dust collecting
system, and hoist)
S02 scrubbers and ducts (4 TCA scrubbers including
mist eliminators, effluent hold tanks, agitators,
pumps, common feed plenum, and exhaust gas ducts
to inlet of fan)
Stack gas reheat (4 indirect steam reheaters and
soot blowers)
Gas handling (4 fans including exhaust gas ducts and
dampers between fan and stack gas plenum)
Oxidation (high pressure oxidation tower, tanks,
agitators, pumps, and air compressors)
Slurry processing (thickener, filters, tanks, and
pumps)
Storage (conveyors and storage silo)
Land (18 acres)
Utilities (instrument air generation and supply
system,-plus distribution systems for obtaining
process steam, water, and electricity from the
power plant)
Service facilities (buildings, shops, stores, site
development, roads, railroads, and walkways)
Construction facilities
Subtotal direct investment
Engineering design and supervision
Construction field expense
Contractor fees
Contingency
Subtotal fixed investment
Allowance for startup and modifications
Interest during construction (8%/annum rate)
Total capital investment
Investment, $
% of subtotal
direct
investment
571,000
1,346,000
6,250,000
828,000
1,977,000
1,258,000
2,145,000
203,000
63,000
93,000
877,000
781,000
16,392,000
1,475,000
1,803,000
820,000
1,639,000
22,129,000
1,770,000
1,770,000
25,669,000
3.5
8.2
38.1
5.0
12.1
7.7
13.1
1.2
0.4
0.6
5.3
4.8
100.0
10.8
10.8
156.6
Basis
Stack gas reheat to 175 F by indirect steam reheat.
Midwest plant location represents project beginning mid-1975, ending mid-1978.
Average cost basis for scaling, mid-1977.
Minimum in-process storage; only pumps are spared.
Investment requirements for removal and disposal of fly ash excluded.
Construction labor shortages with accompanying overtime pay incentive not
considered.
81
-------
TABLE 22. CHIYODA THOROUGHBRED 101 FGD PROCESS
SUMMARY OF ESTIMATED FIXED INVESTMENT3
(500-MW new coal-fired power unit, 3.5% sulfur in fuel,
90% SO- removal, 1977 cost basis)
Material handling (hoppers, feeders, conveyors, ele-
vator, bins, dust collecting and bag filter systems)
Feed preparation (feeders, crushers, elevators, ball
mills, conveyor, tanks, agitators, pumps, dust col-
lecting system, and hoist)
S09 absorption-oxidation (4 Chiyoda absorber-oxidation
vessels, compressors, pumps, common feed plenum,
and exhaust gas ducts to inlet of fan)
Reheat (4 indirect steam reheaters and soot blowers)
Gas handling (4 fans including exhaust gas ducts and
dampers between fan and stack gas plenum)
Slurry processing (4 Chiyoda neutralizers, compressor,
tanks, agitators, pumps, cyclones, centrifuges, and
thickener)
Solids disposal (conveyor and storage silo)
Land (18 acres)
Utilities (instrument air generation and supply
system, plus distribution systems for obtaining
process steam, water, and electricity from the power
plant)
Service facilities (buildings, shops, stores, site
development, roads, railroads, and walkways)
Construction facilities
Subtotal direct investment
Engineering design and supervision
Construction field expense
Contractor fees
Contingency
Subtotal fixed investment
Allowance for startup and modification
Interest during construction (8%/annum rate)
Total capital investment
Investment, $
I of subtotal
direct
investment
640,000
1,401,000
13,930,000
819,000
2,071,000
4,237,000
203,000
63,000
117,000
1,168,000
1.234.000
25,883,000
2,329,000
2,847,000
1,294,000
2,588,000
34,941,000
2,795,000
2,795,000
•40,531,000
2.5
5.4
53.8
3.2
8.0
16.4
0.8
0.2
0.4
135.0
10.8
10.8
156.6
Basis
Stack gas reheat to 175 F by indirect steam reheat.
Midwest plant location represents project beginning mid-1975, ending mid-1978.
Average cost basis for scaling, mid-1977.
Minimum in-process storage; only pumps are spared.
Investment requirements for removal and disposal of fly ash excluded.
Construction labor shortages with accompanying overtime pay incentive not
considered.
82
-------
TABLE 23. DOWA BASIC ALUMINUM SULFATE-GYPSUM PROCESS
SUMMARY OF ESTIMATED FIXED INVESTMENT3
(500-MW new coal-fired power unit, 3.5% sulfur in fuel,
90% S02 removal, 1977 cost basis)
Material handling (hoppers, feeders, conveyors, ele-
vator, bins, dust collecting and bag filter systems)
Feed preparation (feeders, crushers, elevators, ball
mills, conveyor, tanks, agitators, pumps, dust col-
lecting system, and hoist)
S02 absorption (4 TCA absorbers including mist elimi-
nators, tanks, agitators, pumps, common feed plenum,
and exhaust gas ducts to inlet of fan)
Reheat (4 indirect steam reheaters and soot blowers)
Gas handling (4 fans including exhaust gas ducts and
dampers between fan and stack gas plenum)
Oxidation (towers and compressors)
Slurry processing (tanks, agitators, pumps, thickener,
drum filters, and conveyor)
Purge unit (tanks, agiuators, pumps)
Solids disposal (conveyor and storage silo)
Land (18 acres)
Utilities (instrument air generation and supply
system, plus distribution systems for obtaining
process steam, water, and electricity from the power
plant)
Service facilities (buildings, shops, stores, site
development, roads, railroads, and walkways)
Construction facilities
Subtotal direct investment
Engineering design and supervision
Construction field expense
Contractor fees
Contingency
Subtotal fixed investment
Allowance for startup and modification
Interest during construction (8%/annum rate)
Total capital investment
Investment, $
I of subtotal
direct
investment
659,000
1,402,000
5,740,000
819,000
2,071,000
852,000
2,095,000
158,000
203,000
63,000
70,000
703,000
742,000
15,577,000
1,402,000
1,714,000
779,000
1,558,000
21,030,000
1,682,000
1,682.000
24,394,000
4.2
9.0
36.9
5.3
13.3
5.5
13.4
1.0
1.3
0.4
0.4
4.5
4.8
100.0
9.0
11.0
5.0
10.0
135.0
10.8
10.8
156.6
Basis
Stack gas reheat to 175 F by indirect steam reheat.
Midwest plant location represents project beginning mid-1975, ending mid-1978.
Average cost basis for scaling, mid-1977.
Minimum in-process storage; only pumps are spared.
Investment requirements for removal and disposal of fly ash excluded.
Construction labor shortages with accompanying overtime pay incentive not
considered.
83
-------
TABLE 24. COMPARISON OF BASE CASE INVESTMENT
REQUIREMENTS FOR FOUR FGD PROCESSES3
Total capital
FGD process investment, $ $/kW
Limestone slurry 28,596,000 57
Limestone-gypsum 25,669,000 51
Chiyoda 40,531,000 81
Dowa 24,394,000 49
a. Basis
500-MW new coal-fired power unit.
3.5% sulfur in coal.
90% S02 removal.
Onsite disposal of limestone sludge.
Mid-1977 cost basis.
84
-------
T
T
oo
f,
H
W
en
w
H
U
g
o
H
D •* Limestone-gypsum
0 •» Limestone slurry
3.5% sulfur
90% S02 removal
7,000 hr annual operati
30
20
10
200
400 600 800
POWER UNIT SIZE, MW
1000
Figure 15. Limestone slurry and limestone-gypsum processes. Effect
of power unit size on total capital investment.
-------
50
oo
t*->
*
H
•Z
in
2
H
M
u
o
H
30
20
10
O 2% sulfur
D 3.5% sulfur
X 5% sulfur
90% SO™ removal
7,000 hr annual operation
200
400 600 800
POWER UNIT SIZE, MW
1000
Figure 16. Limestone-gypsum process. Effect of power unit size and
percent sulfur on total capital investment.
-------
TABLE 25. LIMESTONE SLURRY PROCESS
TOTAL AVERAGE ANNUAL REVENUE REQUIREMENTS - REGULATED UTILITY ECONOMICS21
(500-MW new coal-fired power unit, 3.5% sulfur in fuel,
90% SO removal, onsite solids disposal)
% of total
Total annual annual revenue
Annual quantity Unit cost. $ cost, $ requirement
Direct Costs
Delivered .raw materials
Limestone 175.0 ktons
Subtotal raw materials cost
Conversion costs
Operatine labor and supervision 21,380 man-hr
Utilities
Steam 518,000 klb
Process water 250,300 kgal
Electricity 55,731,000 kWh
Maintenance
Labor and material, 0.08 x 18,261,000
Analyses
Subtotal conversion costs
Subtotal direct costs
6.00/ton
10.00/man-hr
1.40/klb
0.11 /kgal
0.027/kWh
1,050,000
1,050,000
213,800
725,200
27,500
1,504,700
1,460,900
45^600
3,977,700
5,027,700
10.39
10.39
2.11
7.18
0.27
14.89
14.46
0.45
39.36
49.75
Indirect Costs
Average capital charges at 14.9% of
total capital investment
Overhead
Plant, 20Z of conversion costs
Administrative, 10% of operating labor
Subtotal indirect costs
Total annual revenue requirements
Equivalent unit revenue requirements
4,260,800
795,500
21,300
5,077,600
10,105,300
C/MBtu $/ton $/ton
Mills/kWh heat input coal burned sulfur removed
2.89
32.08
7.70
281.64
42.17
7.87
0.21
50.25
100.00
a. Basis
Remaining life of power plant, 30 years.
Coal burned, 1,312,500 tons/year, 9,000 Btu/kWh.
Stack gas reheat to 175 F.
Power unit on-streara time, 7,000 hours/year.
Midwest plant location, 1978 revenue requirements.
Total capital investment, $28,596,000; subtotal direct investment, $18,261,000.
Working capital, $847,300.
Revenue requirements for removal and disposal of fly ash excluded.
87
-------
TABLE 26. LIMESTONE-GYPSUM PROCESS
TOTAL AVERAGE ANNUAL REVENUE REQUIREMENTS - REGULATED UTILITY ECONOMICS3
(500-MW new coal-fired power unit, 3.5% sulfur in fuel.
90% SO. removal, 240,960 tons/year gypsum, 1978 cost basis)
Annual quantity Unit cost, $
Total annual
cost, $
Direct Costs
Delivered raw materials
Limestone
H2S04
Subtotal raw materials cost
Conversion costs
Operating labor and supervision
Utilities
Steam
Process water
Electricity
Water treatment
Maintenance
Labor and material, 0.08 x 16,392,000
Analyses
Subtotal conversion costs
Subtotal direct costs
175.0 ktons
24.1 ktons
6.00/ton
54.00/ton
28,050 man-hr 10.00/man-hr
526,400 klb
269,000 kgal
88,723,000 kWh
74,340 kgal
1.40/klb
0.11/kgal
0.027/kWh
1.20/kgal
1,050,000
1.301.400
2,351,400
280,500
737,000
29,600
2,395,500
89,200
1,311,400
68,400
4,911,600
7,263,000
Z of total
annual revenue
requirement
8.68
10.76
19.44
2.32
6.09
0.24
19.80
0.74
10.84
0.57
40.60
60.04
Indirect Costs
Average capital charges at 14.91 of
total capital investment
Overhead
Plant, 20% of conversion costs
Administrative, 10% of operating labor
Subtotal indirect costs
Total annual revenue requirements
Equivalent unit revenue requirements
3,824,700
982,300
28,100
4,835,100
12,098,100
C/MBtu S/ton $/ton
Mills/kUh heat input coal burned sulfur removed
3.46 38.41 9.22 337.18
31.61
8.12
0.23
39.96
100.00
$/ton gypsum
produced
50.21
Basis
Remaining life of power plant, 30 years.
Coal burned, 1,312,500 tons/year, 9,000 Btu/kWh.
Stack gas reheat to 175°F.
Power unit on-stream time, 7,000 hours/year.
Midwest plant location, 1978 revenue requirements.
Total capital investment, $25,669,000; direct investment, $16,392,000.
Working capital, $1,249,400.
Revenue requirements for removal and disposal of fly ash excluded.
Gypsum production rate and unit production cost are based on dry CaSO^-2H20, however, gypsum cake
contains 20% free moisture.
88
-------
TABLE 27. CHIYODA THOROUGHBRED 101 FGD PROCESS
TOTAL AVERAGE ANNUAL REVENUE REQUIREMENTS - REGULATED UTILITY ECONOMICS*
(500-MW new coal-fired
198,800
Direct Costs
Delivered raw materials
Limestone
Catalyst, Fe2(S04)3
Subtotal raw materials cost
Conversion costs
Operating labor and supervision
Utilities
Steam
Process water
Electricity
Water treatment
Maintenance, 6% of direct investment
(labor and material)
Analyses
Subtotal conversion costs
Subtotal direct costs
power unit, 3.5% sulfur in fuel, 90% SO. removal,
tons/year gypsum, 1978 cost basis)
Annual quantity
Z of total
Total annual annual revenue
Unit cost. $ cost. $
124,677 tons
1,750 tons
46,500 man-hr
509,910 klb
201,130 kgal
155,125,600 kWh
74,340 kgal
3,500 man-hr
6.00/ton
85.00/ton
10.00/man-hr
1.40/klb
0.11/kgal
0.027/kWh
1.20/kgal
15.00/man-hr
748,100
148,800
896,900
465,000
713,900
22,100
4,188,400
89,200
1,553,000
52,500
7,084,100
7,981,000
4.83
0.96
5.79
3.00
4.61
0.14
27.05
0.58
10.03
0.34
45.75
51.54
Indirect Costs
Average capital charges at 14.9% of
total capital investment
Overhead
Plant, 20% of conversion costs
Administrative, 10% of operating labor
Subtotal indirect costs
Total annual revenue requirements
6,039,100
1,416,800
46,500
7,50.7,400
15,483,400
39.01
9.15
0.30
48.46
100.00
C/MBtu S/ton $/ton $/ton gypsum
Mills/kWh heat input coal burned sulfur removed produced
Equivalent unit revenue requirements
4.42
49.15
11.80
431.17
77.88
Basis
Remaining life of power plant, 30 years.
Coal burned, 1,312,500 tons/year, 9,000 Btu/kWh.
Stack gas reheat to 175 F by indirect steara reheat.
Power unit on-stream time, 7,000 hours/year.
Midwest plant location, 1978 revenue requirements.
Total capital investment, $40,531,000; direct investment, $25,883,000.
Working capital, $1,323,100.
Investment and revenue requirements for removal and disposal of fly ash excluded.
Gypsum production rate and unit production cost are based on dry CaSO^-2ii20, however, gypsum cake
contains 20% free moisture.
89
-------
TABLE 28. DOWA BASIC ALUMINUM SULFATE-GYPSUM PROCESS
TOTAL AVERAGE ANNUAL REVENUE REQUIREMENTS - REGULATED UTILITY ECONOMICS3
(500-MW new coal-fired power unit, 3.5Z sulfur in fuel, 90% S02 removal,
199,360 tons/year gypsum, 1978 cost basis)
Direct Costs
Delivered raw materials
Aluminum sulfate, S7Z
Limestone
Catalyst, MnS04
Subtotal raw materials cost
Conversion costs
Operating labor and supervision
Utilities
Steam
Process water
Electricity
Water treatment
Maintenance, 62 of direct investment
(labor and material)
Analyses
Subtotal conversion costs
Subtotal direct costs
Annual quantity
Total annual
Unit cost. $ cost. $
Z of total
annual revenue
requirement
1,722 tons
124,677 tons
6,430 Ib
150.00/ton
6.00/ton
0.065/lb
46,500 man-hr 10.00/man-hr
509,910 klb
306,260 kgal
93,752,600 kWh
74,340 kgal
1.40/klb
0.11/kgal
0.027/kWh
1.20/kgal
3,500 man-hr 15.00/man-hr
258,300
748,100
400
1,006,800
465,000
713,900
33,700
2,531,300
89,200
934,600
52,500
4,820,200
5,827,000
2.47
7.14
9.61
4.44
6.82
0.32
24.18
0.85
8.92
0.50
46.03
55.64
Indirect Costs
Average capital charges at 14.9Z of
total capital investment
Overhead
Plant, 20Z of conversion costs
Administrative, IOZ of operating labor
Subtotal indirect costs
Total annual revenue requirements
3,634,700
964,000
46^500
4,645,200
10,472,200
34.71
9.21
0.44
44.36
100.00
Equivalent unit revenue requirements
C/MBtu $/ton $/ton $/ton gypsum
Mills/kWh heat input coal burned sulfur removed produced
2.99
33.25
7.98
291.62
52.53
Basis
Remaining life of power plant, 30 years.
Coal burned, 1,312,500 tons/year, 9,000 Btu/kWh.
Stack gas reheat to 175 F by indirect steam reheat.
Power unit on-stream time, 7,000 hours/year.
Midwest plant location. 1978 revenue requirements.
Total capital investment, $24,394,000; direct investment, $15,577,000.
Working capital, $978,500.
Investment and revenue requirements for removal and disposal of fly ash excluded.
Gypsum production rate and unit production cost are based on dry CaS04-2H20, however, gypsum cake
contains 20Z free moisture.
90
-------
TABLE 29. COMPARISON OF ANNUAL REVENUE REQUIREMENTS
FOR FOUR FGD SYSTEMS AT BASE CASE CONDITIONS3
FGD system
Limestone slurry
Limestone-gypsum
Chiyoda
Dowa
Total
annual revenue
requirements, $
10,105,300
12,098,100
15,483,400
10,472,200
Mills/kWh
2.89
3.46
4.42
2.99
c/MBtu
heat input
32.08
38.41
49.15
33.25
$/ton
coal burned
7.70
9.22
11.80
7.98
$/ton
sulfur
removed
281.64
337.18
431.17
291.62
$/ton gypsum
produced
.
50.21
77.88
52.53
Gypsum produced,
tons/yr
240,960
198,800
199,360
a. Basis
500-MW new coal-fired power unit.
3.5% sulfur in coal.
90% S02 removal.
7,000-hour/year operation.
Mid-1978 cost basis.
Onsite disposal of limestone sludge.
-------
Figure 17 shows the effect of power unit size on average annual
revenue requirements for both limestone slurry and limestone-gypsum
processes. A 200-MW power unit equipped with limestone-gypsum FGD
requires revenue of $5,488,000 when operating at a load factor of 7000
kWh/kW, while a 1000-MW power unit will require $21,243,600 for the same
load factor.
The effect of power unit size and sulfur content of coal on revenue
requirement expressed in mills/kWh is shown in Figure 18 for limestone
slurry and Figure 19 for limestone-gypsum.
The sensitivity of revenue requirements for both the limestone
slurry and limestone-gypsum processes to variations in limestone price
ranging from $4 to $8/ton at various power unit sizes is indicated in
Figure 20.
Figure 21 shows the difference between the revenue requirements of
limestone slurry and limestone-gypsum in dollars per ton of gypsum
produced at various power unit sizes and sulfur contents of coal. The
revenue requirements are for 7000 hours of operation and byproduct
revenue is excluded from the total requirements.
Lifetime Revenue Requirements
The lifetime operating profiles over 30 years for a base case power
plant with limestone slurry scrubbing (no salable abatement product) and
with lime stone-gyp sum scrubbing including revenue from the sale of
gypsum are shown in Appendix B, Tables B-9 through B-15. The overall
net increase or decrease in cost of power is shown for each year, con-
sidering the declining annual revenue requirement and the net sales
revenue resulting from sale of marketable gypsum.
A summary of levelized increase or decrease in unit revenue require-
ment equivalent to the discounted process cost over the life of the
power unit appears in Table 30. For each of the processes studied, units
are expressed in $/ton of coal burned, mills/kWh, C/MBtu heat input, and
$/ton of sulfur removed. The lifetime economic projections show that
gypsum must sell for about $7/ton to equate the net revenue requirements
for the limestone-gypsum process to that of the limestone slurry process.
ESTIMATE LIMITATIONS
The economic evaluations of the four FGD systems presented in this
report are based on premises developed for a TVA/EPA publication entitled
Detailed Cost Estimates for Advanced Effluent Desulfurization Processes.
Recently, design and economic premises for use in future TVA evaluations
have been modified through discussion with EPA and others to reflect
prevailing fuel characteristics, current design practice, and economic
conditions. The results of these modifications are shown in a paper
presented at the EPA Flue Gas Desulfurization Symposium in Hollywood,
Florida, November 8-11, 1977 (39) where investment for the limestone
92
-------
25
OO
S3
w
p
2;
w
w
O
w
H
O
H
20
15
10
Limestone-gypsum
Limestone slurry
3.5% sulfur
90% S02 removal
7,000 Rr annual operation
200
AOO 600 800
POWER UNIT SIZE, MW
1000
Figure 17. Limestone slurry and limestone-gypsum processes. Effect of
power unit size on average annual revenue requirement.
-------
to
I-J
Q - 2% sulfur
H - 3.5% sulfur
X - 5% sulfur
90% S0? removal
7,000 fir
annual operation
200
400 600 800
POWER UNIT SIZE, MW
1000
Figure 18. Limestone slurry process. Effect of power unit size and
percent sulfur qn-revenue requirements in mills/kWh.
-------
2% sulfur
3.5% sulfur
5% sulfur
90% S02 removal
7,000 fir annual operation
200
400 600 800
POWER UNIT SIZE, MW
1000
Figure 19. Limestone-gypsum process. Effect of cower unit size and
percent sulfur on revenue requirements in mills/'kWh.
-------
25
M
O*
w
w
1
w
20
15
10
0
G
O
X
$4/ton
$6/ton
$8/ton
Limestone slurry
Limestone-gypsum
3.5% sulfur
90% S02 removal
7,000 hr annual operation
I
I
200
400 600 800
POWER UNIT SIZE, MW
1000
Figure 20. Limestone slurry and limestone-gypsum processes. Effect of power
unit size and limestone'cost on average annual revenue requirement.
-------
xc>
O
w
u
p
Q
O
O
H
H
w
O
O
Js
w
fx
O
^
H
Sr-
w
0-2% sulfur
- 3.5% sulfur
V - 5% sulfur
90% SO removal
7,000 nr annual operation
200
400 600 800
POWER UNIT SIZE, MW
1000
Figure 21. Differential revenue requirement between limestone slurry and
limestone-'gypsum. Effect of. power unit size and percent sulfur on
incremental revenue requirements. Byproduct revenue excluded
from .total revenue requirements.
-------
TABLE 30. SUMMARY OF LIMESTONE SLURRY AND LIMESTONE-GYPSUM
LEVELIZED UNIT REVENUE REQUIREMENTS
Levelized increase (decrease) in
unit revenue requirement
(discounted process cost over life of power unit)
Process
Limestone slurry
Limestone-gypsum
Limestone-gypsum
Limestone-gypsum
Limestone-gypsum
Limestone-gypsum
Limestone-gypsum
Net revenue,
$/ton
0.00
0.00
2.00
4.00
6.00
8.00
10.00
$/ton
coal burned
9.69
11.01
10.65
10.28
9.91
9.55
9.18
Mills/kWh
3.64
4.13
3.99
3.86
3.72
3.58
3.44
C/MBtu
heat input
40.39
45.89
44.36
42.83
41.31
39.78
38.25
$/ton
sulfur
removed
354.50
402.81
389.39
375.96
362.54
349.11
335.69
98
-------
slurry process is estimated at $97/kW (1979) as compared with the $57/kW
(1977) reported in this study. This increase of $40/kW includes not
only inflation factors from 1977 to 1979 and the effects of premise
changes, but also increased equipment and sludge pond requirements and a
more detailed method of estimating indirect investment costs. The
revenue requirements for the limestone slurry process have increased to
4.03 mills/kWh (1980) from the 2.89 mills/kWh (1978) reported here.
TVA will soon be revising the Dowa evaluation on the basis of the
updated premises to produce investment and revenue requirement costs
comparable to the 1979-1980 limestone slurry numbers. A new Chiyoda
estimate will also follow, based on that company's latest process tech-
nology—the Thoroughbred 121 system. New technology which is an extension
of Dr. Robert Borgwardt's work in forced oxidation (41) is being developed
at TVA1s Shawnee Test Facility. Any future estimate of a limestone-
gypsum system would incorporate forced oxidation in the process design.
Although the costs of the gypsum-producing processes discussed in
this study will increase using the premises and estimating techniques
mentioned above, cost relativity is expected to remain approximately the
same. It is unlikely that the higher estimates for the processes will
affect the overall conclusions. However, caution should be exercised in
reviewing this or any cost estimate to determine design parameters and
premise assumptions before making direct comparisons to other evaluations.
99
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SUPPLY OF ABATEMENT GYPSUM
According to data available from the FPC Form 67 Data Tapes, a
total of 800 plants with 3,382 boilers having a total megawatt capacity
of 411,404 MW will be in operation in 1978. Characteristics of the
power utility industry are shown in Appendix C. For each plant considered,
compliance status in 1978 was determined based on projected operating
conditions and emission regulations effective June 30, 1976. S02
emission regulations and the method of their application in this"study
are shown in Appendix D. When calculated S02 emissions exceed calculated
allowable emissions by 10% or more, the plant (or boiler) was considered
to be out of compliance. According to the calculations, a total of 187
plants will be out of compliance in 1978. These plants are shown in
Figure 22.
In order to provide an option for plants with extremely high esti-
mated scrubbing costs, it was assumed that coal with sulfur content
sufficiently low to meet the emission regulation could be purchased and
used at an incremental premium cost of $0.70/MBtu heat content. Deter-
mination of actual costs to modify plants and purchase complying fuel
was beyond the scope of this study. When the $0.70/MBtu clean fuel
screen was applied, 116 plants were found to be candidates for an FGD
system. A scrubber cost generator model was designed to estimate the
cost of compliance by alternative scrubbing methods. A description of
the model and its use is shown in Appendix E. The following analysis
focuses on selection of the best candidates for gypsum production.
TOTAL POTENTIAL SUPPLY
Industry supply is based on the assumption that all plants must
meet compliance and that, as in the base case, the limestone slurry
process is the least costly method to use for compliance. (All plants
where clean fuel would be used have already been excluded from the
analysis.) Utilities would only be willing to produce gypsum and offer
it for sale if the price offset the added cost of gypsum production over
the limestone slurry FGD cost. The industry supply schedule therefore
represents the incremental cost of gypsum production at each plant.
Since the study is conducted under the long-run supply framework, the
utility manager may view each process as fixed and decide which process
to use before committing resources. The decision to use the gypsum-
producing process therefore would be made only if total revenue from
gypsum sales would at least offset the total cost difference in producing
101
-------
I •
FGD COST <_ $0.70/MBtu
FGD COST > $0.70/MBtu
Figure 2. Steam plant locations calculated to exceed compliance regulations, 1973,
-------
gypsum. Supply is committed in advance from each plant. It will either
be zero tons (use limestone slurry) or the tonnage resulting from removal
of required amounts of S02 emissions. The base case plant, for example,
showed gypsum production to cost an added $7/ton. Total production was
240,900 tons. Total incremental gypsum production cost was $1,686,300.
If total revenue from the sale of the total quantity of gypsum were to
equal or exceed the cost difference, the decision would be made to use
the gypsum-producing process and 240,900 tons would be offered. If
total revenue were below the cost difference, no gypsum would be offered.
In determining total revenue from gypsum sales, the option to stockpile
gypsum for future sale was left open. Stockpiling cost is assumed to be
$2.40/ton. In estimating total revenue the steam plant would absorb
freight cost of up to $2.40/ton. (The estimate for stockpiling cost
includes direct labor, equipment charges, and land charges.)
Industry supply on a plant-by-plant basis is shown in Table 31.
Market and revenue potential for each plant is covered in the next
section of the analysis. Total production could amount to over 27 Mtons
or about 9 Mtons more than projected for the 1978 domestic consumption.
Even if all plants could produce and sell abatement gypsum at sufficient
revenue to offset additional cost of production, markets would not be
available for the total production.
VARIABILITY IN INCREMENTAL COST
The data in Table 31 show a variability in incremental cost of
gypsum per ton ranging from a negative $13 to a positive $20/ton.
Depreciation and capital charges are directly proportional to the
required investment for all processes and account for the major portion
of the net revenue requirements. Incremental costs for producing by-
product gypsum as opposed to ponding a limestone sludge is calculated as
the difference between the projected revenue required for the two alter-
nate processes divided by the quantity of gypsum produced.
There are three major factors which influence the revenue required
for the two processes and the level of the variable incremental cost:
plant size, sulfur content of fuel, and plant age (which determines the
remaining life of the plant). The investment required for the gypsum-
producing process is a function of the plant size and the sulfur content
of the fuel. Since byproduct gypsum is assumed to be marketed rather
than stockpiled, disposal facility size and costs for the gypsum alter-
native do not vary with plant age. In contrast, the investment required
for the limestone process in which the disposal byproducts are ponded is
a function of all three factors.
103
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TABLE 31. TONS OF GYPSUM PRODUCED AT STEAM PLANTS EAST OF ROCKY MOUNTAINS AT CALCULATED LEVELS
OF INCREMENTAL COST PER TON OF GYPSUM3 COMPARED TO LIMESTONE SCRUBBING
(EACH PLANT WHERE LIMESTONE FGD COST IS <$0.70/MBTUb)
Incremental
cost ,
-$13
11,286
11,286
Incremental
cost ,
>$0
73,645
15,752
69,142°
Incremental
cost ,
-$6
38,517
38,517
Incremental
cost,
+$1
76,772
101,700
58,079
120,567
20,974
158,711
150,513
Incremental
cost ,
-$4
28,678
28,678
Incremental
cost ,
+$2
164,573
170,129
149,991
134,101
131,670
46,917
149,175
Incremental
cost,
-$3
56,274
56,274
Incremental
cost,
+$3
277,413
275,382
278,156
326,840
159,685
208,842
50,068
237,269
Incremental
cost ,
-$2
89,097
89,097
Incremental
cost ,
+$4
230,814
555,853
67,770
475,461
Incremental
cost ,
-$1
43,894
106,931
65,881
55,370
272,076
Incremental
cost ,
+$5
53,517
212,128
833,163
616,939
561,493
330,948
150,992
210,506
409,218
68,801
Incremental
cost ,
<$0
14,520
85,824
72,126
92,233
96,173
6,680°
367,556
'Incremental
cost ,
+$6
278,044
268,766
330,450
529,662
323,832
127,909
61,655
205,279
1,255,593
387,177
158,539
687,316
946,553
1,813,654
1,329,898
3,447,710
3,768,37;
(continued)
-------
TABLE 31 (continued)
o
Ui
Incremental
cost,
+$7
456,490
68,247
176,407
422,850
49,541
228,064
550,580
1,378,537
290,772
3,621,488
Incremental
cost ,
+$14
176,238
125,261
301,499
Total plants
Grand total
a. Rounded
b. Only 3 p
Incremental
cost ,
+$8
311,535
56,413
122,061
950,404
1,440,413
Incremental
cost,
+$15
: 113
gypsum: 27,406,
Incremental
cost,
+$9
187,477
957,636
102,642
88,152
379,406
154,321
61,878
1,931,512
Incremental
cost ,
+$16
55,281
55,281
562
Incremental
cost ,
+$10
81,749
92,990
500,881
424,152
46,995
115,157
567,437
557,981
63,544C
131J456C
2,587,342
Incremental
cost ,
+$17
Incremental
cost ,
+$11
500,602
668,309
409,183
88,120
193,869
84,582
195,755
121,007
2,261,427
Incremental
cost ,
+$18
Incremental
cost ,
+$12
660,900
633,913
160,527
145,891°
66,380°
1,667,611
Incremental
cost ,
+$19
17,245
17,245
Incremental
cost ,
+$13
489,555
489,555
Incremental
cost,
+$20
17,660°
17,660
to nearest $l/ton.
lants of the 116
out of compl
.iance were loc
.ated west of t
he transcontin
ental
divide. All three were located inland (Wyoming and Nevada). Due to location near gypsum
deposits it was concluded that no potential existed for abatement gypsum production at
those three plants. They are therefore removed from consideration as potential gypsum
suppliers and will be assumed to choose the limestone slurry process.
Plants where mixed strategy would be used. (One or more boilers would use a scrubbing
system, remaining would use clean fuel.)
-------
Variations in power plant size and sulfur content of fuel affect
investment (and associated revenue requirements) differently for the two
processes. The limestone process realizes improved economics relative
to the gypsum process for larger plants and plants which utilize high-
sulfur fuels because the economy of scale for building large ponds is
better than for building large gypsum-producing facilities. However,
for either small plants or installations which utilize low-sulfur fuel,
the reverse is true.
The effect of plant age is also significant in impacting incre-
mental costs. Since older plants have a lower remaining life, the
investment required for the limestone process disposal ponds is lower
for older plants. The limestone process for older plants realizes a
capital investment (and revenue requirement) savings with decreasing
remaining life and therefore becomes more economical than the gypsum
process since the investment (and associated revenue requirements) for
the gypsum process do not decrease with plant age.
The extreme cost variability occurs in only a few cases and only a
small volume of required sulfur removal is involved. The base case
estimate indicated an incremental cost of $7/ton for a new 500-MW plant.
Results of the cost model when applied to all plants out of compliance
indicated a $7/ton incremental cost on 13% of total potential gypsum
production. Two-thirds of total potential production would occur within
a range of $3.50 to $10.50/ton incremental cost. Only 10% of total
potential abatement gypsum production would occur at an incremental cost
below estimated cost of mining crude gypsum.
106
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MARKET POTENTIAL FOR ABATEMENT GYPSUM
Fifty-five existing demand points for crude gypsum are calcining
plants. These plants are estimated to use 11,855,910 tons of gypsum in
1978 including 4,770,000 tons of imported gypsum at 23 plants. Estimated
consumption per plant ranges from a low of 58,260 tons to a high of over
500,000 tons. Average consumption per plant was estimated at 215,562
tons. Distribution of calcining plants by estimated annual use of crude
gypsum is shown in Table 32.
TABLE 32. SUMMARY OF PROJECTED ANNUAL USE BY
WALLBOARD PLANTS BY SIZE - 1978 (Eastern U.S.)
Size, No.
ktons plants
100-200 13
200-300 34
300-400 2
>400 44
All except three of the interior calcining plants are located at or
near mine sites. In these cases the delivered cost is based on $3/ton
variable mining cost plus $l/ton for moving the material from mine to
plant. For the three exceptions, calculated rail rates from the company-
owned mines were added to the $3/ton variable cost to establish a deliv-
ered cost. For coastal plants, shipping costs of $3-5 were added to the
estimated variable mining cost of $2 for imported gypsum to calculate
delivered cost. The distribution of calcining plants by delivered cost
of crude gypsum was as follows:
Delivered cost, No.
$/ton plants
4 24
5-7 28
8-10 3
107
-------
One hundred thirty-two demand points are cement plants. The cement
industry is projected to use a total of 3,187,391 tons of gypsum in 1978
including 1,164,000 tons of imported gypsum at 43 plants. Use per plant
ranges from a low of 2,550 tons to a high of 65,875 tons. Average use
per plant will amount to 24,147 tons. The distribution of plants by
estimated annual use of gypsum is shown in Table 33.
TABLE 33. SUMMARY OF PROJECTED ANNUAL USE BY
CEMENT PLANTS BY SIZE - 1978 (Eastern U.S.)
Size, No.
ktons plants
<10
10-20
20-30
30-40
>40
8
45
46
20
13
Delivered prices were based on an average f.o.b. price of $6/ton
from nearest supply points. Supply points for imported gypsum were
assumed to be the nearest calcining plant. Rail transportation was
assumed in each case and minimum delivered cost of crude gypsum was
calculated to each cement demand point. Delivered costs ranged from a
low of $12.43/ton to a high of $21.18. The majority of tonnage has a
delivered cost of between $15 and $18/ton. Distribution of delivered
cost to cement plants is as follows:
Delivered cost, No.
$/ton plants
<15 33
15-18 78
>18 22
MARKET MODEL
The market model and methodology of the study is based on the
concept that utilities can produce and distribute abatement gypsum and
replace that currently being purchased by wallboard and cement plants.
If the replacement gypsum can be produced and distributed to current
demand points at present cost or less without adding to FGD costs for
utilities, the total cost to the two industries is lower. The prediction
of which steam plants would have an economic incentive to produce abate-
ment gypsum and which demand points would have an economic incentive to
108
-------
purchase abatement gypsum is accomplished through use of a model.
Projected demand at each point and minimum delivered cost of crude
gypsum has been established. The supply of abatement gypsum at each
steam plant along with total incremental gypsum production cost at each
point and transportation cost to each demand point have also been estab-
lished. The nature of supply is that production of gypsum will be
either zero tons or the tonnage to be produced at compliance for each
plant.
The model calculates total cost to the gypsum industry to mine and
distribute crude gypsum and total cost to the utilities industry to meet
compliance by the limestone slurry FGD system. The sum of the two costs
represents total cost to both industries. All costs are established on
a point-by-point basis and industry cost represents the sum of each cost
at demand points or supply points. The transportation portion of the
model solves for the maximum potential revenue to each utility (supply
point) on a plant-by-plant basis to meet compliance by the gypsum-
producing to FGD process. If total gypsum revenue minus total incre-
mental gypsum production cost is positive on a plant basis, production
and sale of abatement gypsum by the utility results in reduction in cost
to both the utilities industry and the gypsum industry. If total revenue
minus total incremental cost to the utility is zero, there is still an
incentive production and sale of abatement gypsum since the utility
avoids the problems associated with ponding slurry.
In the model, each utility attempts to produce,and sell abatement
gypsum in competition with all other utilities. The solution shows only
the utilities that could economically produce and market abatement gypsum
to existing wallboard and cement plants and assumes that those plants
would choose the gypsum process; all others would choose the limestone
slurry process. Further, the solution assumes that each plant produces
gypsum in 1978 and that the market instantly arrives at equilibrium, con-
ditions. Such "perfect" decisions will not be made by the two industries
and therefore an alternative approach to generating market solutions was
utilized that reflects an analytical procedure that an individual utility
might employ in assessing its potential to produce and market abatement
gypsum.
MARKET ANALYSIS
The analysis is conducted in a predictive mode by using a screening
procedure moving from least restrictive to more restrictive market con-
ditions at each step. As conditions become more restrictive the number
of plants that would be predicted to produce and market gypsum declines.
Maximum Noncompetitive Supply of Abatement Gypsum
The initial step is to consider each potential gypsum producer as
though the supply from that plant were the only source of new supply.
Each utility may supply any demand point without regard for competition
109
-------
for that demand. The incremental gypsum production cost, tons of gypsum
to be produced, price and quantity at each demand point, and rail rate
to each demand point are established. Then an f.o.b. price per ton to
each demand point is developed that allows abatement gypsum to be pur-
chased at the same cost as crude gypsum. In other words, all savings
possible are captured by the utility industry. This procedure assures
that all possible gypsum suppliers are considered in the best possible
circumstances. If the total revenue is negative at any plant after this
analysis, it could never become positive under more restrictive conditions,
An analysis was completed for each plant under the above conditions.
A total of 66 utilities could reduce the cost of compliance by producing
and marketing gypsum. A total of 101 nonexclusive demand points were
involved in the solution. Only 2 of the 101 demand points are calcining
plants, the rest are cement plants. This solution does not quantify the
market, it simply illustrates that 66 utilities are potential suppliers
if they each had first choice at the market.
Data from an example plant are shown in Table 34 to demonstrate
information generated for each steam plant. The plant is calculated to
produce a total of 158,716 tons of gypsum. The cost of the limestone
slurry process is $12,685k and the cost of the gypsum-producing process
is $12,831k making a total incremental cost of $146k or $0.92/ton of
gypsum. Gypsum production is distributed to eight demand points as
shown. The first three columns show demand point identification,
current demand for gypsum, and calculated minimum delivered cost of
crude gypsum to each point. The next three columns show distribution of
abatement gypsum by the steam plant. Tons sold to each demand point,
maximum f.o.b. price to the utility for each demand point, and revenue
from each transaction are shown. Total revenue to the utility is $ 1,233k.
Net revenue (total revenue minus $146k total incremental cost) is $ 1,087k.
Total savings to both industries is $l,087k, all of which accrues to the
utility. If the utility could effect the above transactions, the cost
of compliance for that plant could be reduced by an amount equal to net
revenue. The gypsum industry would replace a total of 158,716 tons of
crude gypsum with abatement gypsum. There would be no savings to the
gypsum industry since the utility was allowed to sell to each demand
point at exactly the same price as crude gypsum.
110
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TABLE 34, ABATEMENT GYPSUM PRODUCTION COST, DISTRIBUTION FOR CEMENT
PRODUCTION, AND REVENUE - EXAMPLE PLANT
Sulfur
removed,
FPC No. tons
Limestone slurry
Cost, Sludge,
$ tons
Abatement
gypsum production
Incremental cost
Cost,
$
Quantity,
tons
Total,
$
Per ton,
$
3795000350 23,622 12,685,279 135,094 12,831,364 158,716 146,085 0.92
Cement plant
demand point
1.
2.
3.
4.
5.
6.
7.
8.
Crude
Quantity,
tons
18,700
13,940
19,933
32,130
29,113
27,413
11,688
20,698
gypsum demand
Delivered cost
crude gypsum/ton,
$
'18.64
18.64
18.64
18.64
16.57
17.03
20.02
15.50
Utility
Quantity,
tons
18,700
13,940
19,933
32,130
29,113
27,413
11,688
5,799
sales , abatement gypsum
f.o.b.
price/ton,
$
10.68
10.68
10.68
10.22
5.81
4.16
3.87
2.63
Total
revenue ,
$
199,790.80
148,934.86
212,964.17
328,240.08
169,030.08
114,038.08
45,279.31
15,251.37
Total
158,716
1,233,528.85
-------
Such a situation would be unlikely for the utility even if it were
the only abatement supplier among utilities. In order to sell the
supply of abatement gypsum, the utility would have to develop a sales
policy and establish a price incentive to implement that policy. These
circumstances lead to the second step in the analysis. The sales ob-
jective may be to maximize net revenue from the production and sale of
abatement gypsum, or it might be to dispose of as much gypsum as possible
so long as cost of compliance is lower than the remaining least-cost
alternative—in this case, the limestone slurry process. This balance
is brought about by incurring increasing transportation cost to serve
more distant markets in order to increase tonnage sold. As transporta-
tion cost increases the uniform f.o.b. price must decrease to the level
required to market the desired tonnage. In order to establish quantities
of abatement gypsum that can be sold from utilities in competition for
the markets, an approximate equilibrium analysis is necessary.
Distribution of Abatement Gypsum at Approximate Market Equilibrium
The objective of this analysis is to establish a price f.o.b.
utility that maximizes revenue while matching supply and demand. The
plants with the lowest incremental costs shown in Table 31 are the
plants most likely to produce gypsum when location is not considered.
The nature of the pricing assumptions with respect to f.o.b. price of
crude gypsum results in uniform delivered costs of crude gypsum to the
demand points. The demand points are located in every major market area
of the Eastern United States. Therefore, the utilities most likely to
produce gypsum are the ones closest to markets and with the lowest
incremental cost. The analysis is completed by first maximizing revenue
to the steam plant with the lowest incremental cost. All demands fully
satisfied by the first plant will be eliminated from further considera-
tion, and the next least cost steam plant will be entered and so on
until all steam plants have been considered. The solution so generated
would represent an approximation of an equilibrium solution based on
logical market development.
Under these conditions 30 steam plants are predicted to produce and
market gypsum when all potential candidates compete for the available
markets; the total amount of abatement gypsum sold was 2,399,081 tons.
The 30 steam plants in the final solution, their location, production,
and incremental cost per ton of gypsum are shown in Table 35. Graphical
representations of supply and demand points are shown in Figures 23 and
24 respectively. The overall results of the analysis are summarized in
Table 36.
112
-------
TABLE 35. SUMMARY OF STEAM PLANTS CALCULATED TO PRODUCE AND MARKET
ABATEMENT GYPSUM, AND NET REVENUE PER PLANT
FPC No.
1385000100
5250001000
2345000200
2270000700
3945000600
5430000250
5440000100
3080000400
0805002700
4050001150
4740000100
2920000500
4480000075
3080000150
5235000100
4045000800
4785000575
5420000400
1415000150
3590000200
2605000150
0720000900
3795000350
5250001400
0785000500
2260000100
3085000350
0700000550
4820000700
3840000500
State
DE
VA
FL
IA
MD
TX
OK
MS
ME
NH
FL
MI
SC
MS
NJ
IN
TX
PA
KY
NY
MI
NC
PA
VA
IL
IN
MS
NY
MI
PA
Incremental cost
Gypsum compared to Net
produced, limestone scrubbing, revenue,
tons $/ton gypsum $
11,288
38,520
28,677
56,278
89,101
65,887
55,371
106,933
43,895
72,128
96,176
14,520
92,238
85,829
6,679
69,132
73,647
15,749
101,706
20,977
58,079
76,778
158,716
150,519
170,139
134,105
131,672
164,582
50,070
159,690
-12.66
-5.56
-3.56
-2.95
-2.37
-1.44
-1.15
-0.92
-0.90
-0.32
-0.31
-0.28
-0.23
-0.23
-0.03
0.06
0.16
0.29
0.57
0.57
0.59
0.68
0.92
1.01
1.60
2.00
2.02
2.46
3.00
3.02
199,063
396,425
320,266
488,383
511,865
337,968
294,934
912,828
183,935
194,889
874,427
84,715
809,931
543,275
42,814
427,859
331,036
167,451
388,260
146,367
32-7,902
393,633
342,920
328,600
569,098
101,735
205,045
492,155
46,109
612,098
Total
2,399,081
11,075,986
113
-------
Figure 23. The locations of 30 steam plants that could lower cost of compliance
by producing and marketing gypsum.
-------
I
Figure 24. The location of demand points,
-------
TABLE 36. SUMMARY OF ANALYSIS RESULTS
Total number of plants out of compliance 187
Lowest-cost strategy
Clean fuel, number of plants 71
Limestone slurry process, number of plants 86
Gypsum production and marketing, number of plants 30
Total gypsum produced, tons 2,400,000
Average production per steam plant, tons 80,000
Smallest gypsum supplier, tons 6,700
Largest gypsum supplier, tons 171,000
Total gypsum sold, tons 2,230,000
Total gypsum stockpiled, tons 171,000
No. of plants where part of production was stockpiled 5
Wallboard plants served 1
Cement plants served 92
Sold to wallboard plants, tons 95,000
Sold to cement plants, tons 2,135,000
Total net revenue to utilities, $ 11,076,000
Total savings to gypsum industry, $ 1,900,000
Savings to gypsum industry, % of total cost 1.5
Average savings per ton of gypsum purchased, $ 0.86
Total first-year compliance cost for 113 plants using
the limestone slurry process, $ 2,038,000,000
Reduction by marketing gypsum, $ 11,076,000
Cost reduction, % 0-5
Required sulfur removal, tons 4,109,000
Sulfur removed by gypsum process, % 8.7
Reduction in sludge disposal by limestone slurry, % 8.0
Imported gypsum displaced, tons 856,000
Domestic gypsum displaced, tons 1,372,000
1978 calcining market served with abatement gypsum, % 0.8
1978 cement market served with abatement gypsum, % 67.0
116
-------
The results of the market analysis summarized in Table 36 indicate
a limited potential for abatement gypsum production and marketing to
significantly contribute to solving compliance problems faced by the
nation's utilities. The original scope of the project was to assess the
feasibility of replacing the crude gypsum projected to be consumed in
wallboard manufacturing in 1978. The analysis indicates that abatement
gypsum would be used by only one existing wallboard manufacturing plant.
This is a result of more profitable markets in the cement industry. For
example, two plants in Florida are located near wallboard manufacturing
plants. If cement markets were not available, these two plants could
partially supply the needs of the wallboard plants on a mutually profit-
able basis.
The major potential for abatement gypsum marketing is to supply the
cement industry. In the analysis 2,132,900 tons was calculated to be
supplied to 92 plants in the cement industry. This tonnage represents
67% of the projected 1978 consumption of gypsum by the cement industry
in the eastern portion of the United States. This tonnage was provided
by small abatement producers that could supply requirements of cement
plants located near the utility. Fifteen of the 30 utilities in the
final solution actually were calculated to have lower cost of gypsum
production than for the limestone slurry throwaway product. An addi-
tional seven plants had an incremental cost of less than $l/ton of
gypsum. The average annual production at these steam plants was 65,400
tons.
The analysis was based on conservative estimates of gypsum mining
costs, but in all other respects the analysis was based on premises
favorable to abatement gypsum. It was assumed to be a perfect sub-
stitute and that users would purchase abatement gypsum instead of crude
if it is available at the same price. Two specific disadvantages for
abatement gypsum were identified: the product has 20% free moisture,
and it may present mechanical handling problems. Extra costs to the
gypsum industry to overcome these disadvantages were not quantified, but
to the extent that they present real costs to the gypsum industry, the
added costs would be discounted from value attributed to abatement
gypsum. When average savings per ton to the gypsum industry are only
$0.86/ton, the economic incentive may not justify the risk of substitution.
The analysis indicates that 74% of imported material used by the
cement industry would be replaced. Since the transportation cost for
the imported material makes up such a high percentage of its total value,
the possibility for replacement with local supplies of abatement gypsum
is good.
Characteristics of steam plants are shown in Table 37 and compared
with characteristics of the plants calculated to produce and market
abatement gypsum.
117
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oo
TABLE 37. SUMMARY OF PROJECTED STEAM PLANT CHARACTERISTICS, 1978
No. of power plants-
No, of boilers
Total capacity, MW
Fuel use
Coal
ktons
TBtua
Average sulfur content, %
Oil
kbbl
TBtu
Average sulfur content, %
Gas .
CftJ
TBtu
Average capacity factor, %
1978
all U.S.
plants
800
3,382
411,004
475,570
10,408
2.12
620,247
3,827
0.99
2,556
2,602
31.87
1978 plants
out of
compliance
187
833
132,599
226,780
5,125
2.81
110,167
687
1.42
108
117
35.12
Calculated least-cost
compliance strategy
Clean
fuel
71
376
23,081
13,167
298
2.87
13,974
89
1.50
80
82
20.90
Limestone
FGD
86
357
86,628
186,887
4,210,000
2.91
43,708
271,000
1.51
15,000
21,000
40.14
Gypsum
FGD
30
100
22,890
26,726
617,000
2.06
52,485
327,000
1.23
13,000
14,000
42.17
Average boiler generating
capacity, MW
Age of boilers, %
122
159
61
242
228
0-5
6-10
11-15
16-30
30
Size of boilers, 7,
200
200-500
501-1000
1000
Capacity factor of boilers, %
20
20-40
41-60
60
Average sulfur removed per plant, tons
5
8
8
42
37
82
11
6
1
40
20
23
17
-
10
10
6
42
32
75
15
9
1
35
17
29
19
-
3
6
5
38
48
95
4
1
0
57
24
14
5
4,662
11
14
7
46
22
59
25
14
2
17
10
38
35
43,628
29
12
9
40
10
60
22
0
0
15
20
52
13
11,900
a. T = one trillion.
-------
The data in Table 37 tend to confirm the predicted results of the
cost model discussed in the section on variability in scrubbing cost.
Plants calculated to produce gypsum are smaller than plants that would
use the limestone slurry throwaway process. On the average, the annual
output of sulfur is only about one-fourth as much as for limestone
systems. In general, the gypsum-producing plants are newer plants, 29%
of them are between zero and 5 years old compared with 11% for limestone
systems. In addition, the sulfur content of fuel is lower.
Distribution Limited to Calcining Plants
Further analyses were conducted to predict market potential under
changed markets or price situations. The original intent of the study
was to determine feasibility of gypsum production and marketing to the
wallboard products industry. One analysis was conducted in which the
existing wallboard-producing plants were assumed to be the only avail-
able market outlets for abatement gypsum. Under this situation, a total
of nine utilities could lower cost of compliance by producing and mar-
keting abatement gypsum; the plants are shown in Table 38. These nine
utilities would partially meet gypsum requirements of eight calcining
plants. Six of the eight calcining plants are located on the east and
southern coastline and currently use imported material. The other two
are assumed to ship domestically-mined gypsum from company-owned mines
to calcining plants—one located in Memphis, Tennessee, and one at
Rotan, Texas. Two of the utilities would have to accept a negative net
back of $3.42/ton. Even so, their cost would be less than utilizing the
limestone throwaway system. The remaining seven would realize positive
prices ranging from $0.45/ton to $3.58/ton. Total gypsum sales amount
to 608 ktons.
TABLE 38. SUMMARY OF STEAM PLANTS CALCULATED TO PRODUCE
AND MARKET ABATEMENT GYPSUM TO WALLBOARD PLANTS ONLY
Gypsum produced,
FPC No. State tons
1385000100
5250001000
2345000200
5430000250
5440000100
3080000400
4740000100
4785000575
3085000350
DE
VA
FL
TX
OK
MS
FL
TX
MS
11,288
38,520
28,677
65,887
55,371
106,933
96,176
73,647
131,672
119
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Distribution to Cement Plants with Price Reduction
The primary analysis was based on the assumption that the gypsum
industry would attempt to hold the price of crude gypsum sold to the
cement industry at $6.00/ton. Variable cost of mining was estimated at
$3.00/ton and it could be possible that domestic crude gypsum price
would decline to that level in the face of competition with abatement
gypsum production by utilities. An analysis was conducted to determine
the impact of a $3.00/ton decrease in price of crude gypsum. It was
found that even with the $3.00/ton price decrease, 27 utilities would
continue to produce and market abatement gypsum. This compares with 30
utilities in the original solution. Abatement gypsum sales would only
be reduced by 365 ktons. Reduction in compliance cost would fall from
$11M to $6.2M. This would be the major impact of the price reduction.
The original market solution is stable even with the $3.00/ton reduction
in competitive price of crude gypsum to cement plants because of their
locations. The cement plants found to purchase gypsum were for the most
part purchasing crude gypsum that had been imported. Utilities located
in reasonable geographic proximity to these plants could displace the
crude gypsum because of savings in transportation costs.
Potential New Calcining Plant Supply of Abatement Gypsum
Earlier discussion of the existing gypsum industry pointed out that
wallboard plants are now located in the proximity of mines or seaports
to minimize the cost of crude gypsum transportation. Producing districts
were shown to exist in many states with the exception of the Southeast.
The discussion of the current industry structure indicated that the
control of gypsum reserves might be an effective barrier to entry into
the wallboard products manufacturing industry. The availability of
abatement gypsum would substantially lower barriers to entry in the
eastern portion of the United States. Based on the existing industry
the minimum economic size of new wallboard plants would require at least
200 ktons gypsum annually. This information suggested that there was a
potential for new wallboard plants to be built across-the-fence from
utilities that could supply a minimum of 200 ktons product annually.
Eighteen steam plants, in addition to the thirty already in the solution,
have estimated potential capacity to produce between 200 and 400 ktons
gypsum annually. These plants are listed in Table 39. Incremental
production costs for production of gypsum instead of using limestone
scrubbing are compared to calculated minimum delivered cost of crude
gypsum to the utility location based on a price of $3/ton f.o.b. mine.
It is not suggested that all of these plants have a potential to develop
across-the-fence outlets, but they are listed to suggest priority for
more detailed analysis.
120
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TABLE 39. LOCATION OF STEAM PLANTS WITH POTENTIAL ANNUAL GYPSUM
PRODUCTION BETWEEN 200 AND 400 KTONS
FPC No.
0785000100
4530000850
5540000250
1000000050
1115001100
1395000250
0790000100
3550000600
5125000700
3455000100
4770000905
2730000600
4045001150
3455000400
4805000300
2755000600
0410000050
4770000100
State
IL
TX
MO
TX
IL
NC
IL
WV
MO
IN
AL
NY
IN
IN
OH
KY
KY
TN
Incremental cost Crude
Gypsum compared to gypsum
produced, limestone scrubbing, delivered,
tons $/ton gypsum $/ton
277,421
208,853
237,275
275,392
278,167
230,825
212,139
330,958
387,189
268,773
205,286
278,052
323,842
330,461
290,785
228,070
311,547
379,422
2.52
2.63
2.66
2.82
3.25
4.03
4.96
5.02
5.50
5.98
6.20
6.40
6.43
6.49
6.50
7.02
7,54
9.35
14.72
13.80
14.73
14.26
14.03
13.57
13.57
14.72
14.72
13.81
16.79
11.66
12.88
13.81
14.72
12.42
13.11
14.95
121
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CONCLUSIONS AND RECOMMENDATIONS
CONCLUSIONS
This analysis has been based on projected 1978 prices, costs, and
operating characteristics of utilities. It has assumed that any plant
out of compliance with existing air quality regulations must be in com-
pliance in 1978. The lime-limestone throwaway process has been viewed
as the least cost route to follow without revenue considerations for
marketable byproducts. These assumptions allow analysis of byproduct
marketing feasibility on cost differences between the lime-limestone
throwaway process and the gypsum-producing process. Abatement gypsum
production and marketing is assumed to be a superior alternative to the
throwaway process if predicted revenue from its sale is equal to or
exceeds the cost difference required to achieve compliance by the gypsum-
producing process. Estimated delivered cost of crude gypsum to existing
demand points is used to calculate revenue potential from abatement
gypsum.
The analysis was conducted in such a manner that savings to the
gypsum users could be calculated along with lowered cost of compliance
to the utility industry. The final market solution predicted that 30
steam plants could lower cost of compliance by producing and marketing
gypsum. These 30 plants would serve a total of 93 demand points. Only
one wallboard plant would purchase abatement gypsum (partly because
cement plants offer a higher price outlet). Compliance cost would be
reduced in the first year by $11M to the 30 power plants compared to use
of limestone scrubbing. This amounts to an average savings of over
$350k/plant. In terms of total industry cost of compliance, the savings
by gypsum production would amount to less than 1%. Savings to the
gypsum industry are calculated to equal $1M. Total gypsum production is
24 Mtons with an average production of 80 ktons/plant. The total is
approximately 53% of the amount that could be produced and sold (at
$3/ton) with costs lower than limestone scrubbing.
Use of gypsum-producing technology at the 30 power plants would
solve only 8.7% of the electric utility sulfur oxides compliance problem
and reduce the required ponding of calcium solids by 8.0%.
Abatement gypsum would be purchased by 92 cement plants. Abatement
gypsum would replace 67% of the projected use of crude gypsum by cement
plants. Cement plants were projected to import 1.1 Mtons. Production
from the 30 steam plants would replace 74% of the imported material used
in cement plants.
123
-------
The market model was also used to assess the feasibility of gypsum
production and marketing if wallboard plants were the only effective
market outlets for abatement gypsum. Under this condition, only nine
utilities could reduce compliance costs by producing and marketing
abatement gypsum to the wallboard industry. These 9 plants could
produce and market a total of 608,000 tons of abatement gypsum on an
average of 67,500 tons/plant. Total reduction in compliance cost for
the 9 plants in comparison to the limestone throwaway system would
amount to $1.6M or an average of $184k/plant. The reason that the
wallboard market is so limited is that existing plants are built at the
same location as the gypsum mine or at the point of minimum water trans-
portation costs. Cement plants, on the other hand, are not located at
gypsum mines and a high percentage of the cost of crude gypsum is trans-
portation cost rather than product cost.
An analysis was conducted based on a $3/ton price reduction to
cement plants. Under this lower price assumption, 27 utilities could
still reduce compliance costs by producing and marketing abatement
gypsum. This compares to 30 utilities found under conditions projected
for 1978. The reduction in abatement gypsum sold would amount to 365
ktons. Under the reduced price assumption, the major difference in
outcome of the analysis was that savings in compliance cost for power
companies was reduced from $11M to $6.2M.
Production and marketing of abatement gypsum to the cement industry
appears to offer an opportunity for steam plants with low annual volumes
of sulfur removal to lower cost of compliance. There appears to be little
opportunity to lower compliance cost by marketing abatement gypsum to
the existing wallboard products industry. The gypsum-production alterna-
tive appears to offer only a limited potential to solve the utility
compliance problems; however, in terms of a total program of byproduct
marketing, the gypsum-production alternative may fill a specific role in
that it appears to meet the needs of small plants when other byproducts
may be better suited to large plants.
Important conclusions from the study are summarized below.
1. Because of huge reserves, no major national interest would be
served by subsidizing abatement production to serve as a stockpile
for later use.
2. Gypsum production and marketing offers a limited potential to the
utility industry to lower cost of compliance; only about 8% of
the electric utility compliance problem would be solved by this
method. Production cost relative to throwaway use of limestone
scrubbing is too great for large plants which contribute the
major share of S02 emissions. Incremental cost of producing
gypsum is greater than the estimated mining costs for natural
gypsum on approximately 85% of total possible abatement pro-
duction. Only about half of the gypsum that could be produced
and sold (at a price of $3) with costs lower than limestone
scrubbing was marketed.
124
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3. Gypsum production and marketing appears to be a viable alterna-
tive for relatively new plants where required S02 removal amounts
to 20-30 ktons of sulfur annually.
4. When viewed in a total program of byproduct production and mar-
keting, gypsum takes on added significance in that it is partic-
ularly well-suited to the segment of the industry with a small
annual volume of required sulfur removal.
5. Cement plants offer the greatest potential market outlet for
abatement gypsum; the wallboard industry would provide an ex-
tremely limited market. The demand at cement plants averages 25
ktons/plant and offers the possibility for about 30 steam plants
to locate a few local market outlets for abatement gypsum.
6. Abatement gypsum appears to offer fewer problems in the manu-
facture of cement than in wallboard.
7. Price reaction by gypsum producers cannot be predicted, but 27
steam plants would be predicted to continue to produce and market
abatement gypsum to the cement industry in the face of a $3/ton
price reduction.
8. Stability of the solution may be further ensured since such a
high proportion of the abatement market is gained by replacing
imported gypsum.
9. Agricultural use of gypsum represents a minor part of the total
market. If forecasts of increasing soil sulfur deficiencies
are correct, agricultural use will be a potential growth market
for sulfur products, including gypsum.
In addition to the primary results, other specific accomplishments
were generated by the study.
1. Specific supply and demand data bases for crude gypsum were
established and may be maintained or improved.
2. A computerized system for approximating rail rates was developed
in conjunction with the study series and is being maintained.
3. Operating characteristics at the boiler level were projected for
each fossil-fired power plant in the United States and placed in
a data base for future use.
RECOMMENDATIONS
The analysis was conducted under the assumption that abatement
gypsum is interchangeable with crude gypsum for use in wallboard and
cement. Both advantages and disadvantages are likely. Tests under
125
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plant conditions, particularly in cement manufacture, need to be con-
ducted to quantify cost associated with the use of abatement gypsum.
Further work to quantify the supply price of crude gypsum of producing
areas is needed. The use of estimated average costs for all regions
detracts from the accuracy of results but probably does not affect the
conclusions. In that regard, gypsum industry cost information is not
generally available; it is difficult for a researcher outside the
industry to develop the intimate knowledge of the industry required for
in-depth analysis. Opportunities to involve industries impacted by
abatement products to improve market data bases need to be pursued.
The study suggests that production of abatement gypsum as a waste
material would be inexpensive. It is therefore recommended that future
research be carried out to assess direct and environmental costs asso-
ciated with stockpiling abatement gypsum as opposed to ponding limestone
sludge. Also, cost estimates need to be developed for producing stockpile-
quality gypsum as opposed to wallboard-quality gypsum.
It is felt that gypsum-producing processes would be more advantageous
to the industry if they were viewed as a stockpiling alternative as well
as a marketing alternative. Information would then be available to
utilities to choose ponding sludge, stockpiling gypsum, or meeting
quality control necessary for wallboard and cement use in order to
market the gypsum. Stockpiled abatement gypsum would be a future source
of sulfur.
Locational considerations were shown to play a major role in deter-
mining feasibility to produce and market abatement gypsum. This study
could only focus on national average mining costs and supply prices.
Future work needs to be conducted based on more precise mining costs in
specific producing districts. Such work could well include the economic
feasibility of new wallboard-producing plants in regions selected for
study. Conclusions of this study need to be tested by conducting
specific location studies for each plant where gypsum appears to repre-
sent a superior economic alternative. For planning future growth in
both the utility and gypsum industries, the special situations where
production of abatement gypsum has good economic potential should be
identified. This will require a cooperative effort between specific
companies. The results of this study and any refinements should be used
by the cement industry to evaluate potential supply of lower cost raw
materials.
In the conduct of this and preceding studies, TVA has developed the
basic data and computer methodology to quickly respond to industry
requests to evaluate alternative FGD systems and byproduct market oppor-
tunities in a variety of ways. This ability needs to be utilized in a
continuing program to provide specific plant studies for utilities on
their request. Current data bases need to be maintained and upgraded.
The cost models should be instrumental in providing information on
compliance alternatives. This information would be particularly helpful
in planning for new power plants and in evaluating the effect of changing
regulations.
126
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130
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APPENDIX A
OTHER GYPSUM-PRODUCING PROCESSES
CONTENTS
Figures Page
A-l Babcock-Hitachi limestone-gypsum process 133
A-2 Borgwardt experimental process 134
A-3 Kawasaki lime-magnesium process 136
A-4 Kureha sodium acetate-gypsum process 137
A-5 Lurgi-Sulfacid process 139
A-6 MHI lime-limestone process (Mitsubishi-JECCO) 140
A-7 Mitsui-Chemico limestone-gypsum process 141
A-8 Moretana gypsum process 143
A-9 Pullman-Kellogg desulfurization process 144
131
-------
APPENDIX A
OTHER GYPSUM-PRODUCING PROCESSES
Except for the MHI (Mitsubishi Heavy Industries) process which
removes particulate from the flue gas in a cooler, particulate is removed
by ESP upstream from the FGD system. Although Babcock-Hitachi, Kureha,
and Mitsui-Chemico are the only processes which specifically mention
wastewater treatment, all gypsum-producing processes will require water
treatment to remove chlorides and other contaminants if closed-loop
operation is to be maintained and wallboard-quality gypsum is to be
produced.
BABCOCK-HITACHI LIMESTONE-GYPSUM PROCESS
Hitachi, Ltd., uses a Babcock and Wilcox scrubber to produce by-
product gypsum (Figure A-l). The Babcock and Wilcox scrubber is a
venturi followed by a perforated plate absorber. The venturi humidifies
and cools the gas but does not remove particulate. Efficiencies of 90%
are obtainable for removal of S02-
Sulfuric acid is used to convert excess limestone (CaC03> in the
recycle stream to gypsum in the reactor and to lower the pH for oxidation.
This converted stream is then fed to the oxidizer where air is injected
through a JECCO rotary atomizer to oxidize the sulfite to gypsum. The
oxidized stream passes to a thickener, a portion is purged for water
treatment, and the underflow is centrifuged to yield a cake containing
7-8% moisture.
BORGWARDT EXPERIMENTAL PROCESS
In IERL-RTP studies, Dr. Robert Borgwardt (1) has developed a
process to oxidize sulfite slurry to gypsum at low air pressure and
stoichiometry. The process (Figure A-2) uses a Penberthy air ejector to
oxidize a portion of the scrubber stream. This is carried out either
within the scrubber loop or outside the scrubber in a second vessel.
Settling and filtration characteristics of the oxidized slurry are
reported to be superior when oxidation is conducted within the scrubber
loop; however, this mode of operation requires that the scrubber operate
at a higher pressure.
1. Borgwardt, R. H. Effect of Forced Oxidation on Limestone-S0x Scrubber
Performance. In: Proceedings of Symposium on Flue Gas Desulfurization,
Vol. I, Hollywood, Florida, November 8-11, 1977. EPA-600/7-78-058a,
March 1978.
132
-------
TO STACK
FLUE GAS
H20 Ł»
i
VENTURI
t
ABSORBER
CIRCULATION TANK
i
REACTOR
CaC03
SLURRY TANK
OXIDIZER
AIR
THICKENER
CENTRIFUGE
GYPSUM
Figure A-l. Babcock-Hitachi limestone-gypsum process.
133
-------
FLUE GAS
LIMESTONE
VENT
t
ABSORBER
EFFLUENT HOLD TANK
OXIDIZER
FILTER
AIR
GYPSUM
Figure A-2. Borgwardt experimental process.
134
-------
The process operates at a low air stoichiometry, 3-4, as opposed to
other processes which operate at a stoichiometry of 4-6. Oxidation
occurs at a typical slurry pH of 5-6, thus eliminating the need for
supplemental acid addition. This process has been tested at bench-scale
level and in a 10-MW prototype; results indicate that the method is
feasible. The quality of the gypsum produced has not been determined.
A disadvantage of this process is the partial breakup of gypsum crystals
by the ejector.
KASASAKI LIME-MAGNESIUM PROCESS
Kawasaki Heavy Industries has found that the addition of magnesium
to a lime-scrubbing process helps to prevent scale formation on process
equipment (Figure A-3). Cooled flue gas is contacted with a slurry of
calcium and magnesium hydroxides to produce calcium-magnesium sulfite.
The resultant slurry is acidified with sulfuric acid and contacted with
air. During oxidation the calcium sulfites are converted to gypsum and
magnesium sulfites to sulfates. Gypsum is separated from the slurry by
a thickener and centrifuge. The magnesium sulfate solution is then
reacted with lime to precipitate magnesium hydroxide. Either limestone
or lime processes can be used; however, S02 removal capabilities are
greater with lime scrubbing which can achieve removal efficiencies of
greater than 90%. In either case, the gypsum contains about 0.5% magnesium
sulfate, but this concentration does not preclude the use of this product
for production of cement.
KUREHA SODIUM ACETATE-GYPSUM PROCESS
Kureha Chemical Industry Company, Ltd., has developed a lime desul-
furization process (Figure A-4) to remo.ve S02 from flue gas as an improve-
ment to their limestone process. The advantages of lime over limestone
are numerous. S02 removal can be achieved using a smaller absorption
tower requiring two stages instead of five. An S02 removal efficiency
of 99% can be obtained in comparison with limestone which has an effi-
ciency of 90%.
Three reactions are involved in the process to produce wallboard
quality gypsum. The S02 reacts with sodium acetate to produce sodium
sulfite and acetic acid in the absorber. Air is used in the oxidizer to
oxidize sodium sulfite to sodium sulfate. This stream is fed to the
gypsum recovery reactor where the sodium sulfate reacts with calcium
acetate formed from the reaction between lime and acetic acid to produce
gypsum and sodium acetate. The sodium acetate is recycled to the
absorber. A drum vacuum filter is recommended for separation of the
gypsum from the slurry.
135
-------
FLUE GAS'
H20
Mg(OH)2
Ca(OH)2
COOLER
REACTOR
TO STACK
t
ABSORBER
OXIDIZER
T
AIR
THICKENER
CENTRIFUGE
GYPSUM
Figure A-3. Kawasaki lime-magnesium process.
136
-------
TO STACK
H20
ABSORBER
FLUE
GAS
NaOH
ABSORBENT
TANK
OXIDATION
T
AIR
WASTE
WATER
TREATMENT
CH3COOH Ca(OH)2
REACTOR
FILTER
GYPSUM
Figure A-4. Kureha sodium acetate-gypsum process.
137
-------
LURGI-SULFACID PROCESS
In the Lurgi-Sulfacid process (Figure A-5), flue gas containing SC>2
is passed over a bed of activated carbon where the SC>2 is converted to
sulfuric acid. The acid washed from the activated carbon is neutralized
with limestone to produce high-quality gypsum which is suitable for
production of wallboard. A centrifuge is used to separate the gypsum
produced in the neutralized stream. The advantage of the process is its
simplicity. However, it requires the use of rubber-lined absorbers and
process equipment and must be designed with upstream fly ash removal to
control plugging of the carbon pores with fly ash.
MHI LIME-LIMESTONE PROCESS (MITSUBISHI-JECCO)
Mitsubishi Heavy Industries and JECCO (Japanese Engineering Consulting
Company) have developed a process (Figure A-6) for producing gypsum as a
byproduct of FGD. The gas is cooled and fly ash is removed in the
cooling tower. About 90% of the entering S02 is absorbed in the scrubber.
Gypsum seed crystals are added to the absorber to provide surface area
for reaction to control scaling. The lime slurry bleed from the absorber
is adjusted to a pH of 3-4 and oxidized by air under pressure in an
oxidation tower. Air is injected into the oxidizer through a JECCO
rotary atomizer. Gypsum produced in the oxidizer is dewatered using a
basket-type centrifugal filter. The product gypsum cake contains 5-10%
moisture.
MITSUI-CHEMICO LIMESTONE-GYPSUM PROCESS
Wallboard-quality gypsum is produced by the Mitsui-Chemico limestone-
gypsum process (Figure A-7). Fly ash is removed in an ESP and two
venturi scrubbers in series are used to absorb the S02 in the flue gas.
Ninety percent removal of S02 is attainable. A portion of the recycle
stream from the first stage is fed to a pH controller where it is contacted
with raw flue gas to lower the pH and complete the reaction of limestone
with S02- This lower pH stream flows to the second stage of the scrubber
and a bleedstream is fed to the oxidizer where air is blown in the
bottom to convert the sulfite to gypsum. The lower pH promotes oxidation
and eliminates the need for supplemental sulfuric acid. An unidentified
catalyst is also used to prevent the formation of a calcium sulfate coating
on both calcium sulfite and carbonate molecules. The slurry is fed to a
centrifuge where the solid gypsum is separated and the supernate is
recycled to the scrubber loop. A small amount of supernate is removed
for water treatment. In pilot-plant tests, a solid containing 98.2%
gypsum was produced. This product is suitable for the production of
wallboard, but now is used as an additive in the production of cement.
This process requires a large capital investment.
138
-------
FLUE.
GAS
laCOi
VENTURI
RECIRCULATION
TANK
NEUTRALIZES.
CENTRIFUGE
xxxxxxxxxxxx
CARBON
ABSOR
TO STACK
BED
BER
GYPSUM
Figure A-5. Lurgi Sulfacid process,
139
-------
FLUE GAS-
H20
CaO
COOLER
ASH NEUTRALIZATION
AND DISPOSAL
SLURRY TANK
TO STACK
t
SCRUBBER
H2S04
w
pH ADJUSTMENT
1
OXIDIZER
V
AIR
THICKENER
CENTRIFUGE
GYPSUM
Figure A-6. MHI lime-limestone process (Mitsubishi-JECCO)
140
-------
TO STACK
mm
GAS >
FIRST SCRUBBER
pH CONTROLLER
SECOND SCRUBBER
OXIDIZER
T
AIR
WASTE
WATER
TREATMENT
CaCO-
i
SLURRY TANK
THICKENER
A
CENTRIFUGE
GYPSUM
Figure A-7. Mitsui-Chemico limestone-gypsum process.
141
-------
MORETANA GYPSUM PROCESS
A joint Fuji Kasui Engineering-Sumitomo Metal Industries process
(Figure A-8) produces gypsum using a lime-limestone process. The gas is
washed in a prescrubber to saturate and cool the gas stream. A Moretana
perforated plate scrubber is used for SC>2 removal. The scrubber is
capable of recovering over 95% of the inlet S(>2 as a calcium sulfite
slurry. The pH of the slurry is lowered by acidification with sulfuric
acid and the slurry is oxidized with air to produce gypsum. A centrifuge
is used for dewatering the product. The scrubber system used in this
process is reported to be suitable for removal of NOX as well as SC^.
PULLMAN-KELLOGG DESULFURIZATION PROCESS
The Pullman-Kellogg process for removal of S02 (Figure A-9) is
simple but does not produce gypsum of high purity. The process uses a
horizontal, weir-type scrubber and S02 removal is promoted by the addition
of magnesium in the form of the oxide, carbonate, or hydroxide. A
portion of the recycle slurry is fed to the oxidizer where it is contacted
with air for oxidation to gypsum. The oxidized slurry is thickened and
filtered. The resulting solid contains about 15% by weight CaC03. To
be suitable for wallboard production, process modifications would be
required to convert a portion of the excess CaC03 in the slurry to
gypsum and lower the pH upstream of the oxidizer. This could be accom-
plished by the addition of sulfuric acid.
142
-------
TO STACK
,0
[FLUE
COOLER
I
NEUTRALIZER
OXIDIZER
AIR
ABSORBER
SEPARATOR
CaO
-*»
SLURRY TANK
CENTRIFUGE
GYPSUM
Figure A-8. Moretana gypsum process.
143
-------
TO STACK
t
WEIR SCRUBBER
I
REACTOR
OXIDIZER
AIR
THICKENER
FILTER
GYPSUM
Figure A-9. Pullman-Kellogg desulfurization process.
144
-------
APPENDIX B
OPERATING AND INVESTMENT TABULATIONS
CONTENTS
Tables
B-l Limestone Slurry Process Equipment List and Cost 147
B-2 Limestone-Gypsum Process Equipment List and Cost 153
B-3 Chiyoda Process Equipment List and Cost 160
B-4 Dowa Process Equipment List and Cost 167
B-5 Limestone Slurry Process - Total Capital Investment
Requirements - Base Case Summary - Process Equipment
and Installation Analysis 175
B-6 Limestone-Gypsum Process - Total Capital Investment
Requirements - Base Case Summary - Process Equipment and
Installation Analysis 177
B-7 Chiyoda Thoroughbred 101 FGD Process - Total Capital
Investment Requirements - Base Case Summary - Process
Equipment and Installation Analysis 179
B-8 Dowa Basic Aluminum Sulfate-Gypsum Process - Total
Capital Investment Requirements - Base Case Summary -
Process Equipment and Installation Analysis 181
B-9 Limestone Slurry Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% S02 Removal, Regulated
Company Economics 183
B-10 Limestone-Gypsum Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% S02 Removal, Regulated
Company Economics 184
B-ll Limestone-Gypsum Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% S02 Removal, Regulated
Company Economics 185
145
-------
Tables
B-12
B-13
B-14
B-15
Limestone-Gypsum Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% SC>2 Removal, Regulated
Company Economics
Limestone-Gypsum Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% S02 Removal, Regulated
Company Economics
Limestone-Gypsum Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% S02 Removal, Regulated
Company Economics
Limestone-Gypsum Process, 500-MW New Coal-Fired Power
Unit, 3.5% Sulfur in Fuel, 90% S02 Removal, Regulated
Company Economics
186
187
188
189
146
-------
TABLE B-l. LIMESTONE SLURRY PROCESS EQUIPMENT LIST AND COST
Area 1—Material Handling
Item
No.
Description
Total material
cost, 1977 $
1. Unloading hopper 1
No. 1
Feeder No. 1
(vibrating),
limestone
Conveyor (belt)
No. 1
4. Conveyor (belt) 1
No. 2
5. Hoppers under
pile
6. Feeder No. 2
(vibrating),
limestone
7. Conveyor (belt)
No. 3
8. Pump, tunnel
sump
9. Elevator No. 1
10. Bin
11. Car shaker 1
12. Dust collecting 1
system No. 1
Capacity 94 ft3, 8 ft 4 in. 2,900
side, 2 ft 4 in. bottom, 3 ft
deep, carbon steel
210 tons/hr, 42 in. wide x 5 4,800
ft long pan, 2-1/2-hp vibrator
included
210 tons/hr, 250 ft/min, 24-in. 4,300
belt, 10 ft long, 2-1/2-hp
motor included
210 tons/hr, 250 ft/min, 24-in. 23,300
belt, 172 ft long, 20-hp motor
included
7 ft 4 in. top, 1 ft 4 in. 7,500
bottom, 3 ft deep, carbon steel
100 tons/hr, 18 in. wide x 3-1/2 7,500
ft long pan, 1-hp vibrator
included
100 tons/hr, 250 ft/min, 18-in. '21,700
belt, 135 ft long, 3-hp motor
included
5 gpm, 10-ft head, 1/4-hp motor 1,800
included, carbon steel, neoprene
lined
100 tons/hr, 16 in. x 8 in. x 19,500
8-1/2 in. bucket, 235 ft/min,
15-hp motor included
5,000 ft3, 3/8 in. carbon steel 28,200
plate plus structural steel
Railroad trackside vibrator 9,700
2,000 ft3/min inertial separator 4,300
XQ cyclone, 2 dust hoppers, fan,
and drive
(continued)
147
-------
TABLE B-l (continued)
Item
No.
Description
Total material
cost. 1977 $
13. Dust collecting
system No. 2
14. Bag filter system
Subtotal
6,000 ft3/min inertial separ-
ator, XQ cyclone, 2 dust
hoppers, fan, and drive
14,000 ft3/min automatic fabric
dust collectors, bag support,
shaker system, isolation damper,
external shaker motor and drive,
dust hopper, fan and motor for
bag filter system (1/2 in feed
preparation area)
8,500
12,500
156,500
Area 2—Feed Preparation
Item
No.
Description
Total material
cost. 1977 $
1. Feeder, bin dis- 2
charge
2. Feeder, weigh
3. Crusher, gyratory 2
4. Elevator No. 2
5. Wet ball mill
6. Tank, mills
product
Lining
2
1
12-1/2 tons/hr, 10 in. wide x 1,800
2-1/2 ft long pan, vibrator
included, carbon steel
12-1/2 tons/hr, 18-in. belt, 14 24,100
ft long, 1-1/2-hp motor
included, carbon steel
12-1/2 tons/hr, 0 x 1-1/2 to 3/4 33,200
in., 25-hp motor included
12-1/2 tons/hr, 235 ft/min, 24 7,100
ft ctrs, 6 in. x 4 in. x 4-1/4
in. bucket, 1-hp motor included
300 tons/day; 8 ft dia x 12 ft 317,800
long, from 3/4 in. to 200 mesh
450-hp motors for ball mill 41,800
1,920 gal, 8 ft dia x 5 ft high, 3,700
vertical with open top, agitator
supports, carbon steel
Neoprene lining for mill product 1,200
tank
(continued)
148
-------
TABLE B-l (continued)
Item
No.
Description
Total material
cost, 1977 $
Agitator, mills
product tank
Pump, mills
product tank
9. Tank, slurry feed
10.
11,
12.
13.
14.
Lining
Agitator, slurry
feed tank
Pump, slurry
feed tank
Dust collecting
system
Hoist 1
Bag filter system 1
1 hp, neoprene coated
96 gpm, 58-ft head, 3-hp motor,
centrifugal, with variable-
speed drive, carbon steel,
neoprene lined
46,080 gal, 17 ft 4 in. dia. x
27 ft high, vertical with open
top, four 1 ft 5 in. wide baffles,
agitator supports, carbon steel
1/4 in. neoprene lining
10 hp, neoprene coated
96 gpm, 58-ft head, 3-hp motor,
centrifugal, with variable-speed
drive, carbon steel, neoprene
lined
8,000 ft3/min inertial separator,
XQ cyclone, 2 dust hoppers, fan
and drive
5 ton electric
14,000 ft3/min automatic fabric
dust collectors, bag support,
shaker system, isolation damper,
external shaker motor and drive,
dust hopper, motor and fan for
bag filter system (1/2 in mater-
ials handling area)
1,800
6,500
5,300
8,300
11,800
6,500
10,500
27,900
12,500
Subtotal
521,800
(continued)
149
-------
TABLE B-l (continued)
Area 3—S02 Scrubbing
Item
No.
Description
Total material
cost. 1977 $
1. TCA scrubber
2. Tank, absorber
effluent hold
Lining
3. Agitator, S02 ab- 4
sorber hold tank
4. Pump, S(>2 absorber 10
recycle slurry
S02 absorber, mobile bed, with 2,705,100
demister, 41 ft long x 13 ft wide
x 41 ft high, 1/4 in. carbon
steel, neoprene lining; 316 SS
grids, high density polyethylene
spheres, FRP spray headers, chevron
vane mist eliminators
240,000 gal, 40 ft dia x 26 ft 59,200
high, open top, agitator supports,
carbon steel
1/4 in. neoprene lining 82,800
50 hp, neoprene coated 77,900
11,500 gpm, 105-ft head, 500-hp 398,200
motor, centrifugal, neoprene
lined, belt drive
5.
6.
Pump, makeup
water
Soot blower
Subtotal
2
40
1,240
motor
gpm, 150- ft head, 100-hp
, vertical multistage turbine
8
235
3,567
,800
,100
,100
Area 4—Reheat
Item
No.
Description
Total material
cost. 1977 $
1. Gas reheater
2. Soot blower
Subtotal
Tube type, 2,090 ft2, one-half
of tubes made of Inconel 625 and
remaining one-half made of Cor-Ten
20
491,800
117.500
609,300
(continued)
150
-------
TABLE B-l (continued)
Area 5—Gas Handling
Item
No.
Description
Total material
cost.1977 $
1. Fan
Subtotal
31 in., 1,200 rpm, 2,500-hp
motor included with insulation.
(Cost is difference between
31 in. and 15 in. fan. Remainder
is allocated to boiler.)
103,500
103,500
Area 6—Solids Disposal
Item
No.
Description
Total material
cost, 1977 $
1. Pond feed tank
Lining
2. Agitator
3. Pump, pond
feed tanka
4. Pump, recycle
pond watera
Subtotal
1 63,000 gal, 21 ft dia x 26 ft
high, vertical with open top,
carbon steel, 1 ft 8 in. x 26 ft
baffles
1/4 in. neoprene lining
1 7-1/2 hp, neoprene coated
4 1,128 gpm, 75-ft head, 50-hp
motor, neoprene lined
2 1,000 gpm, 150-ft head, 75-hp
motor, multistage turbine, cast
iron bowl, stainless steel
impellers
16,400
14,000
7,900
13,100
4,300
55,700
a. Cost for this equipment prorated for fly ash removal.
Area 7—Land
Note: There is no process equipment in this area.
(continued)
151
-------
TABLE B-l (continued)
Area 8 — Utilities
Note: There is no process equipment in this area.
Area 9 — Services
Item No. Description
1. Payloader 1 Gasoline type, 2 yd^
2. Plant vehicles - (allocation)
3. Maintenance and - Office, machine tools, and
Total material
cost, 1977 $
36,400
14,700
38,800
instrument shop
equipment
4. Service building
equipment
5. Stores equipment
Subtotal
machine shop equipment
Equipment for laboratory, locker
room, motor control room, rest-
rooms
51,400
Office equipment, shelving, etc. 15,600
156,900
152
-------
TABLE B-2. LIMESTONE-GYPSUM PROCESS EQUIPMENT LIST AND COST
Area 1—Material Handling
Item
No.
Description
Total material
cost. 1977 $
1. Unloading hopper 1
No. 1
2. Feeder No. 1
(vibrating),
limestone
3. Conveyor (belt)
No. 1
4. Conveyor (belt) 1
No. 2
5. Hoppers under
pile
6. Feeder No. 2
(vibrating),
limestone
7. Conveyor (belt)
No. 3
8. Pump, tunnel 2
sump
9. Elevator No. 1 1
10. Bin 1
11. Car shaker 1
12. Dust collecting 1
system No. 1
Capacity 94 ft3, 8 ft 4 in. 2,900
side, 2 ft 4 in. bottom, 3 ft
deep, carbon steel
210 tons/hr, 42 in. wide x 5 ft 4,800
long pan, 2-1/2-hp vibrator
included
210 tons/hr, 250 ft/min, 24-in. 4,300
belt, 10 ft long, 2-1/2-hp motor
included
210 tons/hr, 250 ft/min, 24-in. 23,300
belt, 172 ft long, 20-hp motor
included
7 ft 4 in. top, 1 ft 4 in. bottom, 7,500
3 ft deep, carbon steel
100 tons/hr, 18 in. wide x 3-1/2 7,500
ft long pan, 1-hp vibrator
included
100 tons/hr, 250 ft/min, 18-in. 21,700
belt, 135 ft long, 3-hp motor
included
5 gpm, 10-ft head, 1/4-hp motor 1,800
included, carbon steel, neoprene
lined
100 tons/hr, 16 in. x 8 in. x 8- 19,500
1/2 in. bucket, 235 ft/min, 15-hp
motor included
5,000 ft3, 3/8 in. carbon steel 28,200
plate plus structural steel
Railroad trackside vibrator 9,700
2,000 ft3/min inertial separator, 4,300
XQ cyclone, 2 dust hoppers, fan,
and drive
(continued)
153
-------
TABLE B-2 (continued)
Item
No.
Description
Total material
cost. 1977 $
13. Dust collecting
system No. 2
14. Bag filter system 1
Subtotal
6,000 ft3/min inertial separa-
tor, XQ cyclone, 2 dust hoppers,
fan, and drive
14,000 ft^/min automatic fabric
dust collectors, bag support,
shaker system, isolation damper,
external shaker motor and drive,
dust hopper, fan and motor for
bag filter system (1/2 in feed
preparation area)
8,500
12,500
156,500
Area 2—Feed Preparation
Item
No.
Description
Total material
cost. 1977 $
1. Feeder, bin dis- 2
charge
2. Feeder, weigh
3. Crusher, gyratory 2
4. Elevator No. 2
5. Wet ball mill
6. Tank, mills
product
Lining
2
1
12-1/2 tons/hr, 10 in. wide x 1,800
2-1/2 ft long pan, vibrator
included, carbon steel
12-1/2 tons/hr, 18-in. belt, 14 24,100
ft long, 1-1/2-hp motor included,
carbon steel
12-1/2 tons/hr, 0 x 1-1/2 to 3/4 33,200
in., 25-hp motor included
12-1/2 tons/hr, 235 ft/min, 24 ft 7,100
ctrs, 6 in. x 4 in. x 4-1/4 in.
bucket, 1-hp motor included
300 tons/day, 8 ft dia x 12 ft 317,800
long, from 3/4 in. to 200 mesh
450-hp motors for ball mill 41,800
1,920 gal, 8 ft dia x 5 ft high, 3,700
vertical with open top, agitator
supports, carbon steel
Neoprene lining for mill product 1,200
tank
(continued)
154
-------
TABLE B-2 (continued)
Item
No.
Description
Total material
cost, 1977 $
7. Agitator, mills
product tank
8. Pump, mills
product tank
9. Tank, slurry feed
1
2
Lining
10. Agitator, slurry
feed tank
11. Pump, slurry
feed tank
12. Dust collecting
system
13. Hoist 1
14. Bag filter system 1
15. Tank, acid
storage
16. Pump, acid unload 2
1 hp, neoprene coated 1,800
96 gpm, 58-ft head, 3-hp motor, 6,500
centrifugal, with variable-speed
drive, carbon steel, neoprene
lined
46,080 gal, 17 ft 4 in. dia x 5,300
27 ft high, vertical with open
top, four 1 ft 5 in. wide baffles,
agitator supports, carbon steel
1/4 in, neoprene lining 8,300
10 hp, neoprene coated 11,800
96 gpm, 58-ft head, 3-hp motor, 6,500
centrifugal, with variable-speed
drive, carbon steel, neoprene
lined
8,000 ft3/min inertia! separator, 10,500
XQ cyclone, 2 dust hoppers, fan,
and drive
5 ton electric 27,900
14,000 ft3/min automatic fabric 12,500
dust collectors, bag support,
shaker system, isolation damper,
external shaker motor and drive,
dust hopper, motor and fan for
bag filter system (1/2 in materials
handling area)
500,000 gal, 50 ft dia x 35 ft 60,800
high, vertical cylinder, carbon
steel
1,200 gpm, 80-ft head, 75-hp motor, 10,900
carbon steel
17.
Pump, acid to
neutralizer
Subtotal
2 8 gpm, 50-ft head, 1-hp motor,
carbon steel
4,200
597,700
(continued)
155
-------
TABLE B-2 (continued)
Area 3—SO? Scrubbing
Item
No.
Description
Total material
cost. 1977 $
1. TCA scrubber
2. Tank, absorber
effluent hold
Lining
3. Agitator, S02 ab- 4
sorber hold tank
4. Pump, SC>2 absorber 10
recycle slurry
5. Pump, makeup
water
S02 absorber, mobile bed, with 2,705,100
demister, 41 ft long x 13 ft
wide x 41 ft high, 1/4 in. carbon
steel, neoprene lining; 316 SS
grids, high density polyethylene
spheres, FRP spray headers,
chevron vane mist eliminators
240,000 gal, 40 ft dia x 26 ft 59,200
high, open top, agitator sup-
ports, carbon steel
1/4 in. neoprene lining 82,800
50 hp, neoprene coated 77,900
11,500 gpm, 105-ft head, 500-hp 398,200
motor, centrifugal, carbon
steel, neoprene lined
130 gpm, 150-ft head, 10-hp motor, 3,800
vertical multistage turbine
6.
7.
Area
1.
Soot blower
Pump , bleed
Subtotal
4 — Reheat
Item
Gas reheater
40
6 179 gpm, 80-ft head, neoprene
lined , 7-hp motor
No. Description
4 Tube type, 2,172 ft2, one-half
235,100
24,400
3,586,500
Total material
cost, 1977 $
512.200
of tubes made of Inconel 625
and remaining one-half of Cor-
Ten
2. Soot blower
Subtotal
20
117,500
629.700
(continued)
156
-------
TABLE B-2 (continued)
Area 5—Gas Handling
Item
No.
Description
Total material
cost. 1977 $
1. Fan
Subtotal
31 in., 1,200 rpm, 2,500-hp
motor included with insulation.
(Cost is difference between
31 in. and 15 in. fan. Remainder
is allocated to boiler.)
103,500
103,500
Area 6—Oxidation
Item
No.
Description
Total material
cost. 1977 $
1. Tank, neutraliza-
tion
Lining
2. Compressor, air,
oxidation tower
3. Tower, oxidation
4. Pump, neutralizer 4
to oxidizer
5. Pump, oxidizer
recycle
Subtotal
53,000 gal, 19 ft dia x 25 ft
high, open top, carbon steel
Neoprene lining
11,500 ft3/min, outlet 100 psig,
2,500 hp
14 ft dia x 50 ft, 5/8 in. carbon
steel, neoprene lined, 100 psig
722 gpm (2 in series, each 100-ft
head), 40-hp motor, neoprene
lined
1,450 gpm (2 in series, each
100-ft head), 100-hp motor,
neoprene lined
4,500
8,900
398,000
192,000
21,800
35,700
660,900
(continued)
157
-------
TABLE B-2 (continued)
Area 7—Slurry Processing
Item
No.
Description
Total material
cost. 1977 $
1. Thickener, gypsum 1
slurry
2. Filter, belt 2
3. Tank, overflow 1
Lining
4. Tank, filter hold 1
Lining
5. Tank, wash 4
Lining
6. Pump, overflow 2
7. Pump, underflow 2
8. Pump, wash 6
Subtotal
Mechanism for 140 ft dia thick- 111,600
ener
Tank, concrete, 1,727 yd3, 140
ft dia x 16 ft 9 in. high, 2 ft
thick walls assumed to average
sloped bottom, footings, etc.—
cost noted below
235 ft2 effective area, standard 421,100
accessories
3,000 gal, 8 ft dia x 8 ft high, 4,500
open top, carbon steel
Neoprene lining 1,200
3,000 gal, 8 ft dia x 8 ft high, 4,500
open top, carbon steel
Neoprene lining 1,200
160 gal, 3 ft x 3 ft, 35 ft2, 900
open top, carbon steel
Neoprene lining 700
414 gpm, 100-ft head, 20-hp 9,300
motor, neoprene lined
322 gpm, 50-ft head, 10-hp 9,300
motor, neoprene lined
60 gpm, 60-ft head, 1.5-hp 12,500
motor, neoprene lined
576,800
Concrete thickener tank cost
is included in concrete foundations 254,700
(continued)
158
-------
TABLE B-2 (continued)
Area 8—Solids Disposal
Item
No.
Description
Total material
cost, 1977 $
1. Conveyor, belt
2. Silo, gypsum
storage
Subtotal
36 tons/hr, 24-in. belt, 700-ft
long, 40-hp motor included
22,800 ft3, 26 ft dia x 43 ft
high, with top and cone bottom,
3/8 in. carbon steel plate
80,600
47,300
127,900
Area 9—Land
Note: There is no process equipment in this area.
Area 10—Utilities
Note: There is no process
equipment in this area.
Area 11 — Services
1.
2.
3.
Item No.
Payloader 1
Plant vehicles -
Maintenance and
Description
Gasoline type, 2 yd3
(allocation)
Office, machine tools, and
Total material
cost, 1977 $
36,400
14,700
38,800
4.
instrument shop
equipment
Service building
equipment
machine shop equipment
Equipment for laboratory, locker
room, motor control room, rest-
rooms
5. Stores equipment
Subtotal
51,400
Office equipment, shelving, etc. 15,600
156,900
159
-------
TABLE B-3. CHIYODA PROCESS EQUIPMENT LIST AND COST
Area 1—Material Handling
Item
No.
Description
Total material
cost, 1977 $
1. Unloading hopper 1
No. 1, limestone
Feeder No. 1
(vibrating),
limestone
Conveyor (belt)
No. 1
4. Conveyor (belt) 1
No. 2
5. Hoppers under
pile
6. Feeder No. 2
(vibrating),
limestone
94 ft3, 8 ft 4 in. side, 2 ft 2,900
4 in. bottom, 3 ft deep, carbon
steel
150 tons/hr, 24 in. wide x 42 4,100
in. long pan, 2-1/2-hp vibrator
included
150 tons/hr, 250 ft/min, 24-in. 4,300
belt, 10 ft long, 2-1/2-hp
motor included
150 tons/hr, 250 ft/min, 24-in. 23,300
belt, 172 ft long, 20-hp motor
included
7 ft 4 in. top, 1 ft 4 in. 7,500
bottom, 3 ft deep, carbon steel
70 tons/hr, 18 in. wide x 4 ft 7,700
long pan, 1-hp vibrator included
7. Conveyor (belt)
No. 3
8. Pump, tunnel sump 2
9. Elevator No. 1
10. Bin, crusher
feed
11. Car shaker
70 tons/hr, 250 ft/min, 18-in. 21,700
belt, 135 ft long, 3-hp motor
included
5 gpm, 10-ft head, 1/4-hp motor 1,800
included, carbon steel, neoprene
lined
70 tons/hr, 16 in. x 8 in. x 12 19,500
in. bucket, 235 ft/min, 15-hp
motor included
3,600 ft3, 15 ft x 15 ft x 16 ft, 23,100
3/8 in. carbon steel plate plus
structural steel
Railroad trackside vibrator 9,700
(continued)
160
-------
TABLE B-3 (continued)
Item
No.
Description
Total material
cost, 1977 $
12. Dust collecting
system No. 1
13. Dust collecting 1
system No. 2
14. Bag filter system 1/2
15. Bin,
storage
Subtotal
2,000 ft3/min inertial separa- 4,300
tor, XQ cyclone, 2 dust hoppers,
fan, and drive
6,000 ft3/min inertial separa- 8,500
tor, XQ cyclone, 2 dust hoppers,
fan, and drive
14,000 ft3/min automatic fabric 12,500
dust collectors, bag support,
shaker system, isolation damper,
external shaker motor and drive,
dust hopper, fan and motor for
bag filter system (1/2 in feed
preparation area)
2,650 ft3, 15 ft dia x 15 ft high, 4,200
with top and cone bottom, carbon
steel
155.100
Area 2—Feed Preparation
Item
No,
Description
Total material
cost, 1977 $
1. Vibrator, lime-
stone bin
2. Discharger
limestone bin
3. Feeder, vibrating
4. Feeder, weigh
5. Crusher, gyratory 2
9 tons/hr, 8 in. slide gate,
pneumatic, with controls, loading
spout with positioner
9 tons/hr, 18 in. wide x 4 ft
long pan, 1-hp vibrator
included, carbon steel
9 tons/hr, 18-in. belt, 14 ft
long, 1/2-hp motor included,
carbon steel
9 tons/hr, 0 x 1-1/2 in. to 3/4
in., 25-hp motor included
(continued)
161
10,300
11,700
5,100
24,100
33,200
-------
TABLE B-3 (continued)
Item No .
6. Elevator No. 2 2
7. Wet ball mill 2
2
8. Tank, mills 1
Total
Description cost
material
, 1977 $
9 tons/hr, 6 in. x 4 in. x 4-1/4 7,100
in. bucket, 235 ft/min, 1-hp motor
included
214 tons/day, 8 ft dia x 12 ft 317,800
long, from 3/4 in. to 200 mesh
450-hp motor 41,800
1,480 gal, 7 ft dia x 5 ft high, 3,600
10.
product
Lining
Agitator, mills
product tank
Pump, mills
product tank
11. Tank, slurry feed 1
Lining
12. Agitator, slurry 1
feed tank
13. Pump, slurry 2
feed tank
14. Dust collecting
system
15. Hoist
open top, four 6 in. wide baffles,
agitator supports, carbon steel
Neoprene lining for mills product 1,000
tank
1 hp, neoprene coated 1,800
74 gpm, 60-ft head, 5-hp motor, 11,100
centrifugal with variable-speed
drive, carbon steel, neoprene
lining
35,500 gal, 16-1/2 ft dia x 24-1/2 5,400
ft high, open top, four 16 in.
wide baffles, agitator supports,
carbon steel
Neoprene lining for slurry feed
tank 7,200
10 hp, neoprene coated 11,800
74 gpm, 60-ft head, 5-hp motor, 11,100
centrifugal with variable-speed
drive, carbon steel, neoprene
lined
8,000 ft3/min inertial separator, 10,500
XQ cyclone, 2 dust hoppers, fan,
and drive
5 ton electric 27,900
(continued)
162
-------
TABLE B-3 (continued)
16.
17.
18.
19.
20.
21.
22.
Item
Bag filter system
Vibrator,
Fe2(S04)3 bin
Discharger,
Fe2(S04)3 bin
Feeder, vibrating
Feeder, weigh
Conveyor, covered
screw
Tank, -solution
No.
1/2
4
1
1
1
1
1
Total material
Description cost, 1977 $
14,000 ft3/min (description in
material handling area)
145 Ib/hr, 4 in. nozzle opening
145 Ib/hr, 5 in. wide x 18-3/4 in.
long pan, 1/2-hp vibrator included
145 Ib/hr, 14-in. belt, 3/4-hp
motor included
500 Ib/hr, 6 in. dia x 10 ft long,
6-1/2 rpm, 1/3-hp motor
846 gal, 5-1/2 ft dia x 5-1/2 ft
12,500
5,100
1,600
600
4,600
3,300
2,100
feed
Lining
23. Agitator, solution
feed tank
24. Pump, solution
feed tank
Subtotal
high, open top, agitator supports,
carbon steel
Neoprene lining for solution feed 600
tank
1/2 hp, neoprene coated 1,300
0.5 gpm, 50-ft head, 1/4-hp motor, 3,700
centrifugal, carbon steel, neo-
prene lined
577,900
Area 3—S02 Scrubbing
Item
No.
Description
Total material
cost, 1977 $
1. Chiyoda absorber-
oxidizer
S02 absorber-oxidizer, 45 ft dia 9,730,000
x 15 ft dia x 85 ft high, ver-
tical double shell, 316L SS;
polypropylene grid, 3-1/2 in.
Tellerette packing, polypropylene
mist eliminator
(continued)
163
-------
TABLE B-3 (continued)
2.
3.
4.
5.
Item No.
Pump , solution
to oxidation
Pump, solution 6
to neutralizer
Compressor, air, 4
oxidation
Pump , makeup water 2
to absorber
Subtotal
Description
Proprietary
1,143 gpm, 150-ft head, 100-hp
motor, centrifugal, 316L SS
5,000 ft3/min, 26 psig outlet,
with intercooler, 1000-hp motor
Total material
cost, 1977 $
65,900
508,400
440 gpm, 150-ft head, 40-hp motor, 6,200
vertical multistage turbine,
carbon steel
_
Area 4 — Reheat
1.
Item No.
Gas reheater 4
Description
Tube type, 2,106 ft2 one-half
Total material
cost, 1977 $
499,400
tubes made of Inconel 625 and
remaining one-half made of Cor-
Ten
2. Soot blower
Subtotal
20
117,500
616,900
Area 5—Gas Handling
Item
No.
Description
Total material
cost, 1977 $_
1. Fan
Subtotal
32 in., 2,500-hp motor included
with insulation. (Cost is
difference between 32 in. and
15 in. fan. Remainder is
allocated to boiler.)
120,500
120,500
(continued)
164
-------
TABLE B-3 (continued)
Area 6—Slurry Processing
Item
No,
Description
Total material
cost. 1977 $
1. Chiyoda
crystallizer
Compressor,
crystallizer air
sparge
Pump, gypsum
slurry
4. Tank, filter
feed
Lining
5. Mixer, filter
feed tank
6. Pump, slurry to
filter
Filter, rotary
drum vacuum
Pump, filter
to thickener
9. Thickener, gypsum 1
slurry
365,600 gal, 43 ft dia x 37 ft 2,000,000
high, cone bottom, 304L SS,
rake mechanism included in price
4,000 ft3/min, 15 psig outlet, 105,800
with intercooler, 900-hp motor
99 gpm, 50-ft head, 5-hp motor, 20,300
centrifugal, carbon steel, neo-
prene lined
6,000 gal, 10 ft dia x 11 ft high, 2,800
open top, mixer supports, carbon
steel
Neoprene lining for centrifuge 4,400
feed tank
10 hp, 316L SS , 23,400
198 gpm, 50-ft head, 7-hp motor, 9,200
centrifugal, carbon steel, neo-
prene lined
14 ft dia x 14 ft long, including 366,200
basin and all auxiliaries
154 gpm, 50-ft head, 5-hp motor, 6,600
centrifugal, carbon steel, neo-
prene lined
Mechanism for 110-ft-dia thickener 88,300
Tank, concrete, 1,012 yd , 110 ft
dia x 10 ft high, 2-ft-thick walls
assumed to average sloped bottom,
footings, etc.—cost noted below
(continued)
165
-------
TABLE B-3 (continued)
Item
No.
Description
Total material
cost, 1977 $
10. Pump, thickener
overflow
11. Tank, thickener
overflow hold
Lining
12. Pump, absorber
liquor return
13. Pump, thickener
underflow
Subtotal
2,278 gpm, 50-ft head, 60-hp
motor, centrifugal, 316L SS
45,560 gal, 20-1/2 ft dia x 20-
1/2 ft high, open top, carbon
steel
Neoprene lining for thickener
overflow hold tank
2,278 gpm, 150-ft head, 200-hp
motor, centrifugal, 316L SS
45 gpm, 150-ft head, 5-hp motor,
centrifugal, carbon steel, neo-
prene lined
Concrete thickener tank cost
is included in concrete founda-
tions
16,600
6,500
10,100
43,700
6,200
2,710,100
118,000
Area 7—Solids Disposal
Item
No.
Description
Total material
cost, 1977 $
1. Conveyor, belt
2. Silo, gypsum
storage
Subtotal
36 tons/hr, 24-in. belt, 700-
ft long, 40-hp motor included,
carbon steel
22,800 ft3, 26 ft dia x 43 ft
high, with top and cone bottom,
3/8 in. carbon steel plate
80,600
47,300
127,900
166
-------
TABLE B-4. DOWA PROCESS EQUIPMENT LIST AND COST
Area 1—Material Handling
Item
No.
Description
Total material
cost, 1977 $
1. Unloading hopper 1
No. 1, limestone
Feeder No. 1
(vibrating),
limestone
Conveyor (belt)
No. 1
4. Conveyor (belt) 1
No. 2
5. Hoppers under pile 3
Feeder No. 2
(vibrating),
limestone
Conveyor (belt)
No. 3
8. Pump, tunnel sump 2
9. Elevator No. 1
10. Bin, crusher
feed
11. Car shaker
9.4 ft3, 8 ft 4 in. side, 2 ft 2,900
4 in. bottom, 3 ft deep, carbon
steel
150 tons/hr, 24 in. wide x 42 4,100
in. long pan, 2-1/2-hp vibrator
included
150 tons/hr, 250 ft/min, 24-in. 4,300
belt, 10 ft long, 2-1/2-hp motor
included
150 tons/hr, 250 ft/min, 24-in. 23,300
belt, 172 ft long, 20-hp motor
included
7 ft 4 in. top, 1 ft 4 in. 7,500
bottom, 3 ft deep, carbon steel
70 tons/hr, 18 in. wide x 4 ft 7,700
long pan, 1-hp vibrator included
70 tons/hr, 250 ft/min, 18-in. 21,700
belt, 135 ft long, 3-hp motor
included
5 gpm, 10-ft head, 1/4-hp motor 1,800
included, carbon steel, neoprene
lined
70 tons/hr, 16 in. x 8 in. x 12 19,500
in. bucket, 235 ft/min, 15-hp
motor included
3,600 ft3, 15 ft x 15 ft x 16'ft, 23,100
3/8 in. carbon steel plate plus
structural steel
Railroad trackside vibrator 9,700
(continued)
167
-------
TABLE B-4 (continued)
Item
No.
Description
Total material
cost, 1977 $
12. Dust collecting
system No. 1
13. Dust collecting 1
system No. 2
14. Bag filter system 1/2
15. Bin, A12(S04)3
storage
Subtotal
2,000 ft3/min inertial separa-
tor, XQ cyclone, 2 dust hoppers,
fan, and drive
6,000 ft-Vmin inertial separa-
tor, XQ cyclone, 2 dust hoppers,
fan, and drive
14,000 ft3/min automatic fabric
dust collectors, bag support,
shaker system, isolation damper,
external shaker motor and drive,
dust hopper, fan and motor for
bag filter system (1/2 in feed
preparation area)
4,580 ft3, 18 ft dia x 18 ft high,
with top and cone bottom, carbon
steel
4,300
8,500
12,500
5,800
156,700
Area 2—Feed Preparation
Item
No.
Description
Total material
cost, 1977 $
1. Vibrator, lime-
stone bin
2. Discharger,
limestone bin
3. Feeder, vibrating 2
4. Feeder, weigh
9 tons/hr, 8 in. slide gate,
pneumatic, with controls, loading
spout with positioner
9 tons/hr, 18 in. wide x 4 ft
long pan, 1-hp vibrator included,
carbon steel
9 tons/hr, 18-in. belt, 14 ft
long, 1/2-hp motor included,
carbon steel
10,300
11,700
5,100
24,100
(continued)
168
-------
TABLE B-4 (continued)
Item
No.
Description
Total material
cost, 1977 $
5. Crusher, gyratory 2
6. Elevator No. 2
Wet ball mill
9.
10.
Tank, mills
product
Lining
Agitator, mills
product tank
Pump, mills
product tank
2
1
11. Tank, slurry feed 1
Lining
12. Agitator, slurry 1
feed tank
13. Pump, slurry 2
feed tank
9 tons/hr, 0 x 1-1/2 in. to 3/4 33,200
in., 25-hp motor included
9 tons/hr, 6 in. x 4 in. x 4-1/4 7,100
in. bucket, 235 ft/min, 1-hp
motor included
214 tons/day, 8 ft dia x 12 ft 317,800
long, from 3/4 in. to 200 mesh
450-hp motor 41,800
1,400 gal, 7 ft dia x 5 ft high, 3,600
open top, four 6 in. wide
baffles, agitator supports,
carbon steel
Neoprene lining for mills product 1,000
tank
1 hp, neoprene coated 1,800
70 gpm, 60-ft head, 3-hp motor, 6,500
centrifugal with variable-speed
drive, carbon steel, neoprene
lined
33,600 gal, 15-1/2 ft dia x 25 4,000
ft high, open top, four 16 in.
wide baffles, agitator supports,
carbon steel
Neoprene lining for slurry feed 5,700
tank
10 hp, neoprene coated 11,800
70 gpm, 60-ft head, 3-hp motor, 6,500
centrifugal with variable-speed
drive, carbon steel, neoprene
lined
(continued)
169
-------
TABLE B-4 (continued)
Item
No.
Description
Total material
cost. 1977 $
14. Dust collecting 1
system
15. Hoist 1
16. Bag filter system 1/2
17. Vibrator, 4
A12(S04)3 bin
18. Discharge feeder, 1
A12(S04)3 bin
19. Feeder,
vibrating
20. Feeder, weigh
21. Conveyor, covered 1
screw
22. Tank, solution 1
feed
Lining
23. Agitator, solu-
tion feed tank
24. Pump, solution
feed tank
Subtotal
8,000 ft^/min inertial separa-
tor, XQ cyclone, 2 dust hoppers,
fan, and drive
5 ton electric
14,000 ft3/min (description in
material handling area)
140 Ib/hr, 4 in. slide gate,
pneumatic, with controls, load-
ing spout with positioner
560 Ib/hr, 18 in. wide x 4 ft
long pan, 1-hp vibrator included,
carbon steel
560 Ib/hr, 18-in. belt, 14 ft
long, 1-1/2-hp motor included,
carbon steel
560 Ib/hr, 6 in. dia x 10 ft long,
6-1/2 rpm, 1/3-hp motor
788 gal, 5 ft dia x 6 ft high,
open top, agitator supports, car-
bon steel
Neoprene lining for solution feed
tank
1/2 hp, neoprene coated
2 gpm, 50-ft head, 1/4-hp motor,
centrifugal, carbon steel, neo-
prene lined
10,500
27,900
12,500
5,100
3,500
2,600
12,000
3,300
2,100
600
1,300
4,700
578.100
(continued)
170
-------
TABLE B-4 (continued)
Area 3 — S00 Scrubbing
Item No. Description
1. TCA scrubber 4 -a
2. Tank, absorber 4 -a
effluent hold
Lining
3. Agitator, absorber 4 -
effluent hold tank
f\
4. Pump, solution 10 -
to oxidation
o
5 . Pump , makeup 6 -
water to absorber
Subtotal
a. Description deleted at vendor's request
Area 4 — Reheat
Item No. Description
1. Gas reheater 4
2. Soot blower 20
Subtotal
a. Description deleted at vendor's request
Area 5 — Gas Handling
Item No. Description
1. Fan 4
Subtotal
Total material
cost, 1977 $
2,705,100
37,800
51,300
214,500
484,000
12,000
3,504,700
Total material
cost, 1977 $
499,400
117,500
616,900
Total material
cost, 1977 $
120,500
120,500
a. Description deleted at vendor's request
(continued)
171
-------
TABLE B-4 (continued)
Area 6 — Oxidation
Item No. Description
0
1. Tower, oxidation 4 -
Lining
ft
2. Compressor, air 4
oxidation tower
Subtotal
a. Description deleted at vendor's request
Area 7 — Slurry Processing
Item No. Description
1. Tank, first 1 -a
neutralizing
Lining
2. Agitator, first 1 -a
neutralizing
tank
3. Pump, No. 1 3 -a
gypsum slurry
o
4. Tank, second 1 -
neutralizing
Lining
*s
5. Agitator, second 1 -
Total material
cost, 1977 $
37,300
50,800
251,900
340,000
Total material
cost, 1977 $
9,400
12,800
116,700
32,200
9,400
12,800
116,700
neutralizing
tank
6. Pump, No. 2
gypsum slurry
7. Thickener
gypsum slurry
32,200
104,200
(continued)
172
-------
TABLE B-4 (continued)
8.
9.
10.
11.
12.
13.
14.
15.
a.
Item
Pump, thickener
overflow
Tank, thickener
overflow hold
Lining
Pump , thickener
overflow hold
tank
Pump, thickener
underflow
Filter, rotary
drum vacuum
Soot blower
Air receiver
Conveyor, filter
cake belt
Subtotal
Description deleted
Total material
No. Description cost, 1977 $
3 -a 20,300
1 -a 7,000
2,000
3 -a 22,000
2 -a 10,700
2 -a 366,200
2 -a 3,500
2 -a 4,400
1 -a 8,000
890,500
Concrete thickener tank cost is 100,400
included in concrete foundations
at vendor's request
Area 8 — Purge Unit
1.
2.
Item
Tank, purge
Lining
Agitator, purge
Total material
No. Description cost, 1977 $
1 -a 10,300
2,600
1 -3 5,100
tank
(continued)
173
-------
TABLE B-4 (continued)
3.
4.
5.
a.
Item No. Description
a
Tank, settling 1
Lining
a
Pump, settling 2
tank underflow
•a
Pump, settling 2 -
tank overflow
to disposal
Subtotal
Description deleted at vendor's request
Total material
cost, 1977 $
3,900
30,200
5,300
3,400
8,100
68,900
Area 9 — Solids Disposal
1.
2.
Item No. Description
a
Conveyor, belt 1
a
Silo, gypsum 1
storage
Subtotal
Total material
cost, 1977 $
80,600
47,300
127,900
a. Description deleted at vendor's request
174
-------
TABLE B-5. LIMESTONE SLURRY PROCESS - TOTAL CAPITAL INVESTMENT REQUIREMENTS -
BASE CASE3 SUMMARY - PROCESS EQUIPMENT AND INSTALLATION ANALYSIS
(k$)
Raw
materials
handling
Direct Costs
Equipment
Material
Lai) or
Piping and Insulation
Material
Labor
Ductwork, chutes, and supports
Material
Labor
,. Concrete foundations
t_n Material
Labor
Excavation, site preparation,
rullro.ids, roads, and pond
Structural
Material
Labor
Electrical
Material
Labor
Instruments
Material
Labor
Paint and miscellaneous
Material
Labor
Buildings
Material
Labor
Land
Construction facilities
Subtotal direct Investment
156
38
2
1
21
11
19
10&
-
16
13
54
109
11
5
2
7
.
.
.
.
571
Feed
preparation
522
75
21
36
9
9
10
50
-
.
.
85
120
72
32
2
8
95
88
_
.
1,234
S02
scrubbing Reheat
3,567 609
583 103
498 14
406 25
90
92
35
106
-
124
53
147 2
146 1
238 29
106 13
5
20 1
%
.
.
.
6,216 797
Gas
handling
104
34
_
.
768
616
6
27
-
.
.
190
200
22
9
.
1
.
.
_
-
1,977
Solids
disposal Land Utilities Services
56 - - 157
36 33
126-8
102 - 16
. . . .
...
2
6
4,449 - - 469
...
3 - -
73-14
240 -14
16-22
7 - 11
3-4
17-4
166
52
490
...
5,136 490 93 877
Construction
facilities Total
5,171
902
669
586
888
728
72
295
4,918
140
69
565
830
410
183
16
58
261
140
490
870 870
870 18,261
7. of
direct
Investment
28.3
4.9
3.7
3.2
4.9
4.0
0.4
1.6
26.9
0.8
0.4
3.1
4.5
2.2
1.0
0.1
0.3
1.4
0.8
2.7
4.8
100.0
.1 of
total
capital
investment
18.1
3.1
2.4
2.1
3.1
2.6
0.3
1.0
17.2
0.5
0.2
2.0
2.9
1.4
0.6
0.1
0.2
0.9
0.5
1.7
3.0
63.9
(continued)
-------
TABLE B-5 (continued)
•/. of
Raw '/• of total
materials Feed S02 Gas Solids Construction direct capital
facilities Total Investment Investment
Indirect Costs
Engineering design and
supervision
Construction field expense
Contractor fees
Subtotal fixed investment
Allowance for startup and
modifications
Total capital Investment
Total capital investment, 1,
51
63
29
57
7/1
62
62
895
3.1
111
136
62
123
1,666
133
133
1,932
6.8
560
684
310
621
8,391
671
671
9,733
34.0
72
86
40
80
1,077
86
86
1,249
4.4
178
217
99
198
2,669
213
213
3,095
10.8
462
565
257
514
6,934
555
555
8,044
28.1
44
54
25
49
662
53
53
768
2.7
3
10
5
9
125
10
10
145
0.5
79
96
43
88
1,183
95
95
1,373
4.8
78
96
43
87
1,174
94
94
1,362
4.8
1,643
2,009
913
1,826
24,652
1,972
1,972
28,596
9.0
11.0
5.0
10.0
135.0
10.8
10.8
156.6
5.7
7.0
3.2
6.4
86.2
6.9
6.9
100.0
500-MW new coal-fired power unit, 3.5% sulfur In fuel; 90'/. SOj removal; onslte solids disposal.
St.nck gas reheat to 175°F by Indirect nteam rel\cat.
Disposal pond located 1 mile from power plant.
Midwest plant location represents project beginning mid-1975, ending mid-1978; average cost basis for scaling, mid-1977.
Minimum in-process storage; only pumps are spared.
Investment requirements for removal and disposal of fly ash excluded.
Construction labor shortages with accompanying overtime pay incentive not considered.
-------
TABLE B-6. LIMESTONE-GYPSUM PROCESS - TOTAL CAPITAL INVESTMENT REQUIREMENTS -
BASE CASE3 SUMMARY - PROCESS EQUIPMENT AND INSTALLATION ANALYSIS
(k$)
n
^
Direct Costs
Equipment
Material
Labor
Piping and Insulation
Material
Lobor
Ductwork, chutes, and supports
Material
Lnbor
Concrete foundations
Material
Labor
Structural
Material
Labor
Electrical
Material
Lnbor
Instruments
Material
Labor
Paint and miscellaneous
Material
Labor
Euildings
Material
Labor
Land
Construction facilities
Subtotal direct investment
Raw
materials
landlinfi
156
38
2
1
21
11
19
106
-
16
13
54
109
11
5
2
7
-
•
-
.
571
Feed
prcpar.it ton
598
108
21
36
9
9
10
51
-
_
_
86
121
72
32
2
8
95
88
_
_
1,346
SO 2
scrubbing
3,587
590
501
408
90
92
35
107
-
124
53
148
146
238
106
5
20
-
_
.
_
6,250
Gas
Reboot handling
V
630 104
105 34
17
27
768
616
6
27
-
_
_
2 190
1 200
31 22
14 9
„
1 1
-
_
_
_
828 1,977
Oxld.ition
661
346
46
24
21
22
14
18
-
5
5
51
25
9
5
3
3
-
_
_
. •
1,258
Slurry
processing
577
250
140
65
-
-
282
577
-
12
5
94
42
57
26
5
3
-
»
.
*
2,145
Solids
disposal Land
127
44
*
.
-
-
1
4
-
3
8
4
10
.
-
1
1
»
_
63
.
203 63
Utilities
-
.
8
16
-
-
_
"
*
..
.
14
14
22
11
4
4
-
_
.
.
93
Services
157
33
-
»
~
-
.
-
469
.
.
.
-
.
-
.
.
166
52
_
.
877
Construction
facilities Totnl
6,597
1,553
715
577
909
750
367
890
469
160
84
643
668
462
208
22
48
261
140
63
781 7B1
781 16,392
7. of
direct
40.2
9.5
4.5
3.5
5.5
4.6
2.2
5.4
2.9
1.0
0.5
3.9
4.1
2.8
1.3
0.1
0.3
1.6
0.9
0.4
4.8
100.0
*L of
total
capital
25.7
6.1
2.9
2.2
3.6
2.9
1.4
3.5
1.8
0.6
0.3
2.5
2.6
1.8
0.8
0.1
0.2
1.0
0.6
0.3
3.0
63.9
(continued)
-------
TABLE B-6 (continued)
t of
T of total
SOj C«a Slurry Solid* Construction direct capital
acrubbtne. Kehaat handling. Oxidation proccuslng dlanosal tend Uttlltlaa Servlcea facilities Total Investment inveatment
Raw
materials Feed
h nnd 1Ing preparation
00
Indirect Co8ts_
engineering design and
supervision 51 121 563 75 178 113 1« IB 6 8 79 70
Construction field rxponsa 63 14« 688 91 217 138 237 2J 7 10 »6 86
Contractor Iocs 29 67 314 41 99 63 107 10 3 S 43 39
CvRtlngfrnry 57 135 625 83 198 126 214 _20 _6 _9 88 JB
SiiUtocsl fixed Invollnont ~77 TJfi TJW TiT? i(,6&» 1..M !.«<><> 273 05 125 I.1S3 1,054
Allowance for startup and .....
modifications 62 145 675 89 ZU tJ« 23* 22 J 10 95 84
liiluruit during count rue 11 on _6J 145 675 BV 21.1 13* ».H J& _1 _!Ł »5 Łi
Total capital invcilment 895 2,107 9,790 1,296 3,095 J,»70 3,360 317 99 143 1,373 1,222
Total capital Investment, I 3.5 8.2 38.1 5.0 12.1 7.7 13.1 1.2 0.4 0.6 3.3 4.8
lull
100-HV ncv coal-fired power unit, 3.51 sulfur in full; 901 SOJ rsmovnl; onslts solidi disposal.
Sciick gas rclicut to 175°^ by Indirect stoura reheat.
Midwest plant locution represents project beginning mid-1975, ending nld-1978; average cost bssls for scsllni, mid-1977.
Minimum tn-proccsu storage; only pumps are spared.
Investment requirements for removal and disposal of fly ash excluded.
Construction labor altortfleos with accompanying overtime pay incentive not considered.
1,473
1,603
820
t.639
22,129
1,770
1.770
25,669
9.0
11.0
5.0
10.0
135.0
10.8
156.6
5.7
7.0
3,2
ifc*
6.9
6.9
100.0
-------
TABLE B-7. CHIYODA THOROUGHBRED 101 FGD PROCESS - TOTAL CAPITAL INVESTMENT REQUIREMENTS -
BASE CASE3 SUMMARY - PROCESS EQUIPMENT AND INSTALLATION ANALYSIS
(k$)
VO
Direct Costs
r.qntpment
M.itrrt.il
l.nlior
Crncri'tc fr-vmdnc Ir-ns
r ill I roniU , ronds, and pontt*
ricctrlc.il
Paint .incl mlscc 1 1 .incous
Hulldlngi
Und
I UIltU<
Services
Subtotal direct Investment
Materials
li.mdl infi
155
62
3
156
.
34
200
20
10
-
-
-
"
640
Feed
578
112
66
71
.
237
117
11
209
•
•
1,401
SOj
absorption- Gas
oxidation Rchc.it dandling
-b 617 120
- 105 34
-b 46
-b - 31
.
-
-b 3 201
-b 47 25
-b 1 1
•
~
"
_
13,930 819 2,071
Slurry
proccs sinR
2,710
150
429
476
-
29
236
143
14
"
_
4,237
t cent Inuod)
Solids
disposal
128
44
-
5
-
10
14
2
_
203
•1, of 7. of total
Construction direct capital
land Utilities Services facilities Total Investment Investment
.
_
-
.
-
-
.
209 0.8 0.5
63 .. - 63 0.2 0.1
117 - - 117 0.4 0.3
1 168 - 1,168 4.5 2.9
1.234 1.234 4.8 3.0
63 117 1,168 1,234 25,883 100.0 63.9
-------
TABLE B-7 (continued)
00
O
Indirect Costs
Engineering design nnd
supervision
Contractor fees
Contlneency
Allowance for startup and
modification
Stack gai reheat to 175°F by Indirect steam reheat.
Construction
Land Utilities Services facilities Total
2,329
2,847
2.588
34,941
2,795
_217?j
40,531
, mid-1977.
% of
direct
Investment
9.0
n.o
10.0
135.0
10.8
10J
156.6
I of total
capital
Investment
5.7
7.0
6.4
86.2
6.9
6,9
100.0
Investment requirements lor removal nnd disposal of fly ash excluded.
Construction labor shortages with accompanying overtime pay Incentive not considered.
b. Proprietary Information.
-------
oo
TABLE B-8. DOWA BASIC ALUMINUM SULFATE-GYPSUM PROCESS - TOTAL CAPITAL INVESTMENT REQUIREMENTS
BASE CASE3 SUMMARY - PROCESS EQUIPMENT AND INSTALLATION ANALYSIS
(k$)
Direct Costs
Equipment
Material
Labor
Piping and Insulation
Ductwork , chutes, and Bupporta
Stru tuml
Elec rlcal
Inst uments
Pain and miscellaneous
Bull* Inge
Land
Utll ties
Scrv CCB
Cons ruction facilities
Materials
hand ling
157
66
3
161
36
206
20
10
-
-
-
.
-
659
Feed
preparation
578
113
66
71
-
237
117
11
209
.
-
_
-
1.402
S02
absorption
3.505
440
776
183
126
ISO
251
288
21
.
.
-
_
-
5,740
% of X of total
Cas Slurry Purge Solids Construction direct capital
Reheat handllnR Oxidation processing unit disposal Land Utilities Services facilities Total Investment Investment
617 120 340 890 70 129 - - - 6,40! 41.1 26.3
105 34 209 204 31 44 - 1,246 8.0 5.1
46 - 83 273 24 - - - - 1,271 8.2 5.2
1,659 43 - .... - 1,885 12.1 7.7
31 44 411 5 5 - 854 5.5 3.5
22 22 2 10 - - - 242 1.6 1.0
1 201 83 175 15 14 - 1,185 7.6 4.9
47 25 22 109 10 - 638 4.1 2.6
1 1 6 11 1 2 - - - 64 0.4 0.3
209 1.3 0.9
... 63 - 63 0.4 0.2
70 - - 70 0.4 0.3
703 - 703 4.5 2.9
742 742 4.8 3.0
819 2,071 852 2,095 158 203 63 70 703 742 15,577 100.0 63.9
(continued)
-------
TABLE B-8 (continued)
I of 7. of total
Material! Foed SO; Ca» Slurry Purge Solldi Construction direct opltal
handling Dronnrntlon absorption Reheat handling. Oxidation grace,tint unit disposal Land Utilities Service! facllltlot Total Investment Investment
Indlr
Engineering tic sign anil
supervision It402 9.0
Construction field expense. 1,714 11.0
Contractor foes 779 5.0
Contingency 1.558 10.0
Subtotal fixed Investment 21,030 135.0
•""* AllowiineQ for startup nntl
00 mpdlfIcntlon 1,682 10.8
N5 Interest during construction U683 10,8
Totol capLtal Investment 24,394 156.6
a. Oasis
500-MW new cool-flrctl power unit, 3.57. suUur In fuel; 907. S02 rcmovol.
Stuck gas reheat to 175°F by Indirect stctun reheat.
MlJueat plant location reprcsi>nt» project boglrmlnt mid-1975, ending mid-1976; average cost basis for scaling, mid-1977.
Minimum In-uroceHs xtoruue; only punps jin> spared.
Investment requirements for removal and dlvposol of fly a«n excluded.
Construction labor shorties with accompanying overtime pay Incentive not considered.
-------
00
OJ
TABLE B-9. LIMESTONE SLURRY PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
n»T.O INVESTMENTI * 2859*000
YEAPS ANNUAL PQWF.W UNIT
AFTER OPERA- HEAT
POWER TIONt >*EOUI«EMENTi I
UNIT KW-HR/ MILLION RTU
START K* /YEAB
" i 7ono iTsonrJnn
2 7000 sisuoonn
3 7000 315UOOOO
4 7000 31500000
.5- 1002 ..315DOQQQ
6 7000 31500000
7 7000 31500000
B 7000 siboonoo
9 7000 •U500000
.12 1222 3i505Q20
11 5000 22SOOOOO
1? 5000 2?5GOOOfl
13 5000 22*00000
14 so o o ??SOOOOQ
.15 5'OQfl 225!)OQBS___.
16 3500 1S7SOOOO
17 3500 15750000
18 3500 157SOOOO
19 3500 15750000
.22 3525 1525DQQS..
21 1500 6750000
22 1500 6750000
23 1500 f>T>QQQei
24 1500 6750000
25 '5QO t2c'2Pl3'1
26 1500 6750000
27 1500 6750000
28 1500 6750000
2V 1500 6750000
.35 ISflfi 6252221!
TOT 127500 5737^0000
LIFETIME AVERARE INCREASE
OULLAOS
MILLS HF
MJLFUM
yŁMOVtl>
O0vf> UNIT HY
I U*.L HOLLUTION
:oN<;u"''Tin.s. CONTMOL
TONS COAL ufiOCFSS.
/YfA* TONS/YEA"
1.H2HOO jsvi/n
131?SOO SS^On
1312500 3S*00
1312500 3S*Ofi
1.312S.UQ ^sv'iO
1312SOH 35<
1312c>fll ._ iS^liQ
S.T7Suo""~ ~™2S«>fln"~'
937SOU ?fv6(iO
"j^TiOO iiseiin
"«37SflO U^h'in
. — 2225aa esftea....
656200 17^00
656700 17*00
6b6?UO 17^1)0
65A200 17VOO
fi'jfiJUU 17^011
2H1200 7/00
2R1200 77nn
2A1?UO 77HO
JH1JOO 7700
.-..,221211!!.... _.._llfin_.
?812UO 7700
281200 7700
2«li>UO 7/'i«
2R1700 77UO
— ZHisfia zzac.,..
23000
206000
2U6000
^rt fcfl ft n
206000
206000
206000
206000
aiibaaa —
""" "147200
147200
147200
l»7?on
14Z2HO..
103000
1CT3000
10JOOO
103000
44100
44100
4410(1
44100
4 A i fj n
44100
4410fl
44100
44100
44122 —
3752000
NET REVENUE.
S/TON
WASTE
SOLIDS
0.0
0.0
0.0
0.0
li &Q
0.0
0.0
0.0
0.0
0 . Q ^
0.0
0.0
0,0
n.o
a*a_
0.0
0.0
0,0
0.0
?iO
0.0
0.0
0.0
0,0
n.ft
0.0
0.0
0.0
0.0
(OrCftFASE) IN UNIT OMF.t»ATINB COST
ffw TON OF COAL yuauto
* KILOWATT-hOUH
CENTS PFW MILLION HTU HFAT INPUT
nOLLA<»S
PROCESS COST DISCOUNTED AT
PEC TON OF bULFUw HtHiWED
10.0% TO INITIAL vem, OULLAUS
TOTAL
OP. COST
INCLUDING
REGULATE!}
ROI FOR
POWER
COMPANY.
*/YEA«
J30HQ90Q
12UH2600
126K4300
124B6100
X 2 2 ftZ ^ Q 0
120H9SOO
11891300
1169.1000
11494700
1122&5CQ
"""" 9645100*"
9446100
924H6QO
9050300
,_...tiai2aflfl _
7522200
7323900
712-S700
6927400
fizuioa
4912300
4714000
4515700
4317500
41 192P.D
3V20900
3722700
3524400
3326100
243958500
10.21
3.83
42. 52
373.31
99722200
TOTAL
NET
SALES
REVENUE.
VYEAR
0
0
0
0
0
0
0
0
d
0
0
0
0
tt_.
0
0
0
0
0
0
0
0
....... ft
0
0
0
NET ANNUAL CUMULATIVE
INCREASE NET INCREASE
(DECREASE) (DECREASE)
IN COST OF IN COST OF
POWER. POWER.
S I
13080900 130B0900
12882600 25963500
12684300 36647800
12486100 51133900
_122flZfiatt-_ 63i21Zao
12089500 75511200
11891300 67402500
11693000 9909SSOO
11494700 110b90200
_U22«aa UIB661QO
9645100 131531800
9446000 140978600
924U600 150227200
90S0300 159277500
__flfl5ŁŁQD-_ _lt(UŁ2520
7S22200 1756*1700
7323900 182975600
7125700 190101300
6927400 197028700
fiZ2iiaa ..2Q3Z5ZflftO
4912300 208670100
4714000 2133B4100
4515700 217899800
4317500 222217300
__41122H_ 2.2133.65.110
3920900 "~230257400
3722700 233900100
3524400 237b04500
0 3326100 240830600
A 3iŁZiaa — etaswsao
o
0.0
0.0
0.0
0.0
0
243958500
10.21
3.83
42.52
373.31
99722200
INCREASE (DECTASF 1 l« UNIT fl^{J|fTINl^ COST EQUIVALENT TO OISCOUNTtD
PILLARS Pf.o TON OF CO»L
"ILLS PFW KJLO«A7T-Hnuw
CFNTS PFfl "ILL ION HIU MF.AT
ft" TON Of
PKOCESS COST OVErt LIFE OF POWER UNIT
9.69 0.0 9.t>9
3.64 0.0 3.64
40.39 0.0 40.39
354.50 0.0 354.50
-------
oo
TABLE B-10. LIMESTONE-GYPSUM PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
INVESTMENT!
Z5670000
SULFUR MY-PROOUCT
REMOVtf) KATE,
YEARS ANNUAL POWEH UNIT POWRP. UNIT HY EDUIVALENT NET
AFTER OPERA- HEAT FUEL POLLUTION
POWER TIONt PEOUIRE"ENT! CONSUMPTION, CONTROL
UNIT KW-HR/ "ILLION BTU TONS COAL PHOCFSS.
START KW /YEAR /YFAW TljNS/YE»W
1 7000 31500000 131R500 JSfOd
2 7000 31500000 1312500 3?>VOO
3 7000 31500000 1312500 35VUO
* 7000 31500009 1312^00 35-JOO
TONS/YtAH
GYWSUM
2*0909
2*0900
2*0900
2*0900
REVENUE!
^/TON
GYPSUM
0.0
0.0
0.0
0.0
..5 2222 3130.2811 13125ia 352C1 2*2222 l»a
6 7000 31500000 1312'>0n 3S9IIO
7 7000 31500000 1312500 3SYno
8 7000 31500000 1312*00 35*110
9 7000 31500000 1312500 35-«!)0
.12 2222 31522220 131252B 35221
11 5000 ?i?l500000 ^37*^00 25600
12 5000 ??500000 937SOO 2*b»0
13 5000 22500000 fl.'H'iOt} 2SOIIO
1* 5000 22500000 937SOI) 2-5hliO
.15 5222 225B2222.. 23152U 25&l!a._..._
16 3500 15750000 d5h?0n 17*00
17 3500 15750000 hSfrSUO 17*00
18 3500 15750000 6cj6?00 17VII9
19 3500 15750000 ftS6?00 17-»»9
.20 3522 15252222 656222 12221
21 1500 6750000 241HUO 77"P
22 1500 6750000' 2B1?'JO 77110
23 1500 6750000 2fil?OU 7700
2* 1500 6750000 2H1POO 77H9
J5 1522.. 6Z51Q2D . _ 2^1221! _ 2Zna
86 1500 67SOOOO ?fll?UO 770d
27 1500 6750000 2H1POO 7700
20 1500 h7SnnoO 211?UI! 77(10
29 1500 6750000 211200 7700
.32 1522 6Z522Q2.. 231221 __._..ZZaa..
TOT*- 127500 573750000 23905S09 6SH300
LIFETIME AVERAGE INC&EASF (DECREASE) IN UNIT OPERATINB
DOLLARS PEw TO'J OF COAL 81/fNtU
MILL*! Pm KIL'I »ATT-nflliW
CFNTS PFR MILLION HTU HEAT IWHMT
DOLLARS PE« Td'J OF SULFUR PMOVF.O
2*dvoo
240VOO
2*0900
2*0»»flfl
2*1222
172100
172100
17?ion
172190
1Z212Q
120500
120500
120500
,120500
51600
51600
51600
61600
"'ItS"
bi6on
51600
51600
51601)
bl&lG
43HHOOO
CUST
0.0
0.0
0.0
0.0
(I.Q
0.0
0.0
0.0
u.o
111
0.0
o.u
0.0
0.0
lt.1
"o.o
0.0
0.0
0.0
Qi 0
0.0
0.0
0.0
0.0
9 fcfl
PROCESS COST DISCOUNTED AT 10.0% TO INITIAL YEAH. POLLA»S
TOTAL
OP. COST
INCLUDING
PECULATED
HOI FOH
POWER
COMPANY!
S/YEAR
14769200
1*591200
14*13200
14235200
TOTAL
NET
SALES
REVENUE,
S/YEAR
0
0
0
0
14152222 a..
13b79200
13701200
13523300
133*5300
i31feZ322 —
10835000
10657000
10*79000
10301000
12123122.
8111*00
7933*00
7755*00
..... 15. LZ 42 0,
~~5086*00~
490R500
4730500
4552500
„ 4314521.
4196500
401H500
36*0500
3662600
34&462C
274599500
11.49
4.31
47. R6
420,20
113310500
LEVELIZED INCREASE (DECREASE) IN UNIT OPK*ATI.M
-------
TABLE B-ll. LIMESTONE-GYPSUM PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
fl*EO INVESTMEMTI % 25*70000
SULFUK tY-PROUUCT
REMOVll) HATE*
YEARS ANNUAL POWER UNIT POWFR UNIT HY EQUIVALENT
AFTER OPERA- HEAT FUF.L POLLUTION TONS/YEA*
POWER TION* REQUIREMENT* CONSUMPTION* CONTROL
UNIT KW-HR/ MILLION 8TU TONS COAL PROCFSS* GYPSUM
START KW /YEAR /YEAR TONS/YEAR
1 7000 31500000 1312500 35*00 2*0900
2 7000 31500000 1312500 3S900 2*0900
3 7000 31SOOOOO 1312SOO 3591)0 2*0900
4 7000 31500000 1312500 3ti-*00 2*09011
..5, 7,022. .-315B223S . 1312t;22 .. 35.9.251 24B.S2n .
6 7000 31500000 1317500 359(1(1 24U900
7 7000 31500000 1312500 35900 240900
8 7000 31500000 1312500 3f>*(>0 2*0900
9 7000 31500000 1312500 35*00 2*0900
.12 222B 31552222 1312522 3522B 2*2.225
11 5000 22500000 937500 35bOO 173100
12 5000 22500000 937500 35600 173100
13 SOOO 22500000 937500 I'lona 172100
,_ 1* 5000 22500000 937500 25000 172100
Oo .15 520.C. .22502222 232'ii!2 2c'&2n 112123
Ui 16 3500 15750000 656200 17*00 120500
17 3500 15750000 6Sf?Ofl 17900 120500
18 3500 15750000 656200 17900 I20SOO
19 3500 15750000 f-56?00 1790(1 120500
-22— 3500. -157.50050, _„„ O5'i?i4. ..._._ lZV0n . .... .1225C9 ..,
21 1500 6750000 ?«1300 7700 5160(1
22 1500 6750000 2112DO 7700 51600
23 1500 6750000 2H1?00 7700 51600
24 1500 6750000 2fll200 7700 51600
.25, 1582... 6152828 2612C2 Z222 5162"
26 1500 6750000 2R1200 7700 b!600
27 1500 6750000 201200 7700 51600
28 1500 6750000 2ftl?00 7700 51600
29 1500 6750000 2R1200 7700 51600
.32 1532 62S222JI.. Ł61252, .Z2"Ł 51622
TOT 127500 573750000 P3905SOO 6S3SSOO 43BHOOO
LIFETIME AVERAGE INCREASE (DECREASF.) IN UNIT OPERATING COST
DOLLARS PER TON OF COAL HUHNtn
MILLS PER KILOrfATT-MOU*
CFNTS PER MILLION HTU MEAT INWUT
DOLLARS PER TON OF SULFUR REMOVED
PROCESS COST DISCOUNTED AT 10.0* TO INITIAL YEA*. OOLLAOS
LEVELIZED INCREASE (DECREASE) IN UNIT OPERATING COST EQUIVALENT TO
DOLLARS PER TON OF CO»L BUHNtU
MILLS PER KILOWATT-HOUH
CENTS PER MILLION BTU MEAT INPUT
HOLLARS PER TON OF SULFUW "EMOVED
RECOKPUTATION RASIS:
20.05S OF NET PEVEMUE
TOTAL
OP. COST
INCLUDING NET ANNUAL CUMULATIVE
NET REVENUE* REGULATED TOTAL INCREASE NET INCREASE
J/TON ROI FOR NET (DECREASE) (DECREASE)
POWER SALES IN COST OF IN COST OF
GYPSUM COMPANY* REVENUE* POWER* POWER*
S/YEAR I/YEAR $ I
2.00 1*769200 4H1800 * 1*287*00 1*287*00
2. 00 1*591200 *fllBOO 1*109*00 28396800
2.00 1**13200 481800 13931400 42328200
2.00 1*235200 481800 13753*00 56081600
2iO_0_ 1.40.5720.0 ,...4.8(800,,, ,.13575*00 r ,,.69651000
2.00 13879200 4H1800 13397*00 83054*00
2.00 13701200 481000 13219*00 96273800
2.00 13523300 481800 130*1500 109315300
2.00 133*5300 481800 12863500 122178800
2*22 1314Z32U 4SIBJ2. 12605522 13.4.116430.0
3.00 10B35000 34*200 10*90600 1*5355100
3.00 106S7000 34*200 10312000 15S667900
2.00 20*79000 34*200 1013*800 165802700
2.00 10301000 3**200 9956600 175759500
ZittL * 10l?.310qj_^34.4200 ^._9Tia90Q 186516400
3.00 8289*00 2*1000 80*R*00 193586800
2.00 8111*00 2*1000 7870400 201*57200
2.00 7933*00 2*1000 7692*00 2091*9600
2.00 7755400 2*1000 751*400 21666*000
2,QO. T57M02 Ł4,1002 . T336*,0.2 . 22*002^fl°
3.00 5086*00 103200 4983200 2289B3600
2.00 4908500 103200 4B05300 233788900
3.00 4730500 103200 4627300 238*16200
2.00 4552500 103200 ***9300 242865500
2i5B 43745BB ..103202 . *.2713Q2 2*7136900
2.00 4196500 103200 4093300 251230100
2.00 401H500 103200 3915300 2551*5*00
2.00 38A0500 103200 3737300 258882700
2.00 3662600 103200 3559*00 262*42100
2tfiL. 348*602 103209 . 33914Q2 265823520
274599500 8776000 265823500
11.49 0.37 11.12
4.31 0.14 4.17
47.86 1.53 46.33
420.20 13.43 406.77
113310500 3776400 109534100
DISCOUNTED PROCESS COST OVER .LIFE OF POWER UNIT
11.01 0.36 10.65
4.13 0.1* 3.99
45.89 1.53 44.36
402.81 13.42 389.39
-------
co
TABLE B-12. LIMESTONE-GYPSUM PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
FIXED INVESTMENT I % 25670000
SULFUH BY-PROOUCT
REMOVED RATE*
YEARS ANNUAL POWER UNIT POWER UNIT BY EQUIVALENT
AFTER OPERA- HEAT FUEL POLLUTION TONS/YEAR
POWER TIONi REQUIREMENT. CONSUMPTION! CONTROL
UNIT XW-HH/ MILLION BTU TOMS COAL PROCESS. GYPSUM
START KW /YEAR /YEAR TONS/YEAR
1 7000 31500000 1312500 35900 240900
2 7000 31500000 1312500 3S400 240900
3 7000 31500000 1312500 35*00 240900
4 7000 31500000 1312500 35*00 240900
5 zoaa aisaaoaa I3iŁ5aa ...asaae .__24ay.D,a
6 7000 31500000 1312500 3">*00 240900
7 7000 31500000 1312500 35*00 240900
8 7000 31500000 1312SOO 3S*00 240900
9 7000 31500000 1312500 35*00 240900
TOTAL
OP. COST
INCLUDING
NET REVENUE. REGULATED
J/TON ROI FOR
POWER
GYPSUM COMPANY,
S/YEAR
4.00 14769200
4.00 14591200
4.00 14413200
4.00 14235200
4»aO_ . iiB5J2J!Q_
4.00 13879200
4.00 13701200
4.00 13523300
4.00 13345300
.ia-...Jaaa..._.3i5aaaaa._— ..I3iŁ5aa__.,»^.__35ifla,_,,.__— Ł4 asao. ___,._.._ s.«.eo_, _,___, i3iti3aa_.
11 5000 22500000 937500 2SbOO 172100
12 5000 22500000 937500 25600 172100
13 5000 22500000 937500 2M>00 172100
14 5000 22500000 937500 25600 172100
.15 5Qsa zzsiaaai! sazsaa zsaaa_... izeiaa___
16 3500 15710000 656200 17*00 120500
17 3500 15750000 656200 17*00 120500
18 3500 15750000 656200 17*00 120500
19 3500 15750000 h56200 17*00 120500
2a _35oa. isisaaoa bs^sao. izyja . . _i2asao
21 1500 6/50000 2HI200 7700 51600
22 1500 6750000 281200 7700 51600
23 1500 6750000 281200 7700 51600
24 1500 6750000 2A1200 7700 51600
.25 isaa. fizsaoca zsmn ..1222 sitaa
26 1500 6750000 28)200 77(10 51600
27 1500 6750000 201200 7700 51600
28 1500 6TSOOOO 2H1200 7/00 51600
2* 1500 6750000 281200 7700 51600
.at — isaa szsaaaa eaiaaa __ziaa ____5.i6aa__..
TOT 1?7500 573750000 23905SOO 653500 43H8000
LIFETIME AVERAGE INCREASE (DECREASE! IN UNIT OPERATINfl COST
DOLLARS PER TON OF COAL BUHNEU
MILLS PER KILOWATT-HOUR
CENTS PER MILLION HTU MEAT INPUT
DOLLARS PER TON OF SULFUR REMOVED
PROCESS COST DISCOUNTED AT 10.0* TO INITIAL YEAH. DOLLARS
LEVELUED INCREASE (DECREASE) IN UNIT OPERATING COST EQUIVALENT TO
DOLLARS PER TON OF COAL BURNED
MILLS PFR KILOWATT-HOUR
CRNTS PF.R MILLION «TU MFAT INPUT
DOLLARS PER TON OF SULFUR REMOVED
RECOMP'JTATION RASISI
40.07* Of-' NtT RRV^NUE
4.00 10835000
4.00 10657000
4.00 10479000
4.00 10301000
... 4*ao ...icisaiaa..
4.00 8289400
4.00 8111400
4.00 7933400
4.00 7755400
4«.aa_ — Z57J4aa
4.00 50U6400
4.00 4908500
4.00 4730500
4.00 4552500
4.00 437450.1!
"""" 4.00 " 4196500™
4.00 4014500
4.00 3840500
4.00 3662600
4«.aa 34a4&22_.
274599500
11.49
4.31
47.86
420.20
113310500
NET ANNUAL CUMULATIVE
TOTAL INCREASE NET INCREASE
NET (DECREASE) (DECREASE)
SALES IN COST OF IN COST OF
REVENUE* POWER. POWER.
S/YEAR J S
963600 13805600 13805600
963600 13627600 27433200
963600 13449600 40882800
963600 13271600 5415*400
_363fcfla___iaa23fiaa_«.__6i24jaao
963600 12915600 80163600
963600 12737600 92901200
963600 12559700 105460900
963600 12381700 117842600
— s&a&flp. — izzaazea — uiaifiaao
688400 10146600 140192900
680400 9968600 1501*1500
680400 9790600 159952100
688400 9612600 169564700
ftaaua S4a*jea — izaimao
482000 7807400 186806800
482000 7629400 194436200
482000 74S1400 201887600
482000 7273400 209161000
._ 48POBB ...7a954qo_.^ 214?5{|4,0°
206400 4800000 221136400
206400 4702100 225838500
206400 4524100 230362600
206400 4346100 234708700
_Ł26!QS____4.16fllOll__ 21QQ16&10
206400* 3990100 ~242866900
206400 3812100 246679000
206400 3634100 250313100
206400 3456200 253769300
_2afi4aa Ki&zm — eaiatiaao
17552000 257047500
0.74 10.75
0.28 4.03
3.06 44.80
26.86 3V3.34
T552900 105757600
DISCOUNTED PROCESS COST OVER LIFE OF POWER UNIT
11.01
4.13
45.89
402.81
0.73 10.28
0.27 3.86
3.06 42.83
26.85 375.96
-------
TABLE B-13. LIMESTONE-GYPSUM PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
FIXFO INVESTMENT! I 25*70000
00
SULFUH
YEARS ANNUAL
AFTER OPERA-
POXES TIONt
UNIT KW-HH/
START
POWER UNIT POWER UNIT
HEAT FUFL
REQUIREMENT! CONSUMPTION,
MILLION BTU TONS COAL
KW
/YEAR
/YEAR
BY
POLLUTION
CONTROL
PROCESS,
TONS/YEAH
HY-PROUUCT
»ATE,
EQUIVALENT
TONS/YEAH
GYPSUM
NET REVENUE*
J/TON
GYPSUM
TOTAL
OP. COST
INCLUDING
REGULATED
ROI FOR
POWER
COHPANYt
$/YEA«
TOTAU
NET
SALES
REVENUE*
S/YEAR
1
2
3
4
-.5.
6
7
8
9
"ll"
12
13
-15.
16
17
IB
19
.28.
21
23
33
34
.25..
26
37
38
39
.38..
7000
7000
7000
7000
288Q..
7000
7000
7000
7000
—2aao..
5000
5000
5000
5000
—5888..
3500
3500
3500
3500
—3588..
1500
1500
1500
1500
... 1598..
1500
1500
1500
1500
,_1588—
31500000
31500000
31500000
31500000
_315aafi4e_
31500000
31500000
31500000
31500000
.3i5»aaoa_
33500000
23500000
33500000
23500000
.
15750000
15750000
157SOOOO
15750000
iszscaaa.
h7SOOOO
67r,ooon
67bonOO
67SOOOO
1312500
1312500
1312500
1312500
1312540..
1312500
1312500
1312500
1312<>00
1312500..
937SOO
937500
937500
937500
83I5UO..
656300
6SA?00
656200
656200
35*00
35900
3*400
35*00
240900
2*CI90n
240900
240900
240900
240900
240900
240900
35600
25600
2b600
35600
J7VOO
17VOU
17900
172100
172100
172100
172100
1Z214G
12U500
120500
120500
I2osnn
._
6750000
6750000
6750000
67SOOOO
281300
3B1200
281200
2*1300
281220 ___
2H1200
2S1300
2fll300
281200
231248...
1IB84..
7700
7700
7/00
7700
ZZ40-.
77UO
7700
7700
77uO
zzaa..
5ihon
51600
51600
51600
51600
14769200 1445400
14591200 1445400
14413200 1445400
14235300 144S400
11451244 Ui5tS8.
13879300 1445400
13701200 1445400
13523300 1445400
1334S300 1445400
131U348 UiSiM.
10835000 1032600
10657000 1032600
10479000 1032600
10301000 1032600
62B9400
6111400
7933400
7755400
.zsmoo.
5086400
4900500
4730500
4552500
43Z&544.
4196500
4018500
3840500
3662600
723000
723000
723000
723000
.123041
309600
309600
309600
309600
_343tOO.
309600
309600
309600
309600
NET ANNUAL
INCREASE
(DECREASE)
IN COST OF
POWER*
1
~I3323BO(T
13145800
12967800
12789800
12433800'
122SS800
12077900
11899900
UZ21200.
9802400
9624400
9446400
9268400
24S85QO_
7566400
7388400
7210400
7032400
4776800"
4598900
4420900
4242900
.10fitS44_
38H6900
3708900
3530900
3353000
CUMULATIVE
NET INCREASE
(DECREASE)
IN COST OF
POWER*
26469600
39437400
52227200
77272800
89538600
101606500
113506400
135030700
144655100
154101500
\63309900
.amtoioo
180026800
187415200
194625600
201658000
—208512180
2132B9200
217888100
222309000
226551900
..230616300
234503700
2.18212600
241743500
245096500
TOT 1P7500 573750000 S3905500 653500 43H8000
LIFETIME AVERAGE INCREASE (DECBFASEI IN UNIT OPEHA'TING COST
DOLLARS PEW TON yF COAL tfimtfJ
MILLS PER KILOWATT-hOU^
CENTS PER MILLION ITU MEAT INPUT
DOLLARS PER TON OF SULFUR REMOVED
PROCESS COST DISCOUNTED AT 10.0» TO INITIAL YEAN. DOLLAHS
274599500 26328000 248271500
11.49
4.31
47.86
420.30
113310500
1.10
0.42
4.59
40.29
11329300
LEVELLED INCREASE (DECREASE) IN UNIT OPŁH1TI«0 COST fOUIVALENT TO DISCOUNTED PHOCESS COST OVER LIFE OF
DOLLARS PF.fi TON OF COAL BURNtO 11,01 1.10
MILLS PER KILOWATT-MOU* 4.13 0.41
CENTS PF.R MILLION BTU HEAT INPUT 45,89 4.58
OOLL»RS PER TON OF bU'.FUl MfMOVEO 402,01 40.27
RECOHPUTATION
60.0* OF NET
10.39
3.69
43.27
379.91
101981200
POWER UNIT
9.91
3.72
41.31
362.54
-------
00
00
TABLE B-14. LIMESTONE-GYPSUM PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
FIXED INVESTMENTI * 25670000
YEARS
AFTER
PO*ER
UNIT
START
1
2
3
4
ANNUAL
OPERA-
TION,
KV-HR/
7000
7000
7000
7000
. 7QOQ .
POWER UNIT
HEAT
REQUIREMENT,
MILLION OTU
/YEAR
31500000
31500000
31SOOOOO
31500000
3150000.!!
6 7000 31400000
7 7000 31SOOOOO
8 7000 31500000
9 7000 31500000
.10.. — — _J. QQQ— — — -.315 0 Qa20—
ll" 5000 " 22500000
12 5000 22500000
13 5000 22500000
14 5000 2?bOOOOO
.15 5(10.0 22500000
16 3500
17 3500
18 3500
19 3500
.20. 35QO...
21 1500
22 1500
23 1500
24 1500
.25 1500. —
26 1500
27 1500
28 1SOO
29 1500
15750000
15750000
15750000
15750000
POWER UNIT
FUEL
CONSUMPTION.
TONS COAL
/YEAR
SULFUrt
REMOVED
BY
POLLUTION
CONTROL
pRocr.ss,
TONS/YEAR
flY-PROOUCT
HATE,
EQUIVALENT
TONS/YEAH
GYPSUM
1312100 31*00 240*00
1312500 31*00 240900
1312100 3S*00 240900
1312500 35*10 240900
1312522 35*2B 248.4111
1312100 35*00 240900
1312500 31*00 24U900
131ZSOO 35*00 240*00
1312500 35*00 240900
937100 21600 172100
937500 25600 172100
937'iOO 25600 172100
937100 21oOO 172100
-. 23I5aa 21000 172100
656200
656200
61620ft
6750000 2H1SOO
6750000 ?Bl?00
67SO'OOn 2B1200
6750000 2A1200
6I5QQ2Q 28122H
6750000 2H120Q
6750000 2R1200
6750000 211200
6750000 2H12UO
...szsacsa 221220....
17*00
17*00
17*00
17*00
771)0
7700
77UO
7700
. zzaa
12IMSOO
120500
120500
120500
b!600
51600
51600
51600
5161(1
TOTAL
OP. COST
INCLUDING
NET REVENUE, REGULATED
I/TON ROI FOR
POKER
GYPSUM COMPANY,
S/YEAR
B.OO
8.00
a. oo
H.OO
tuao
b.oo
H.OO
B.OO
H.OO
„ a»aa .
B.OO
8.00
a. oo
H.OO
_.fci.aa_
H.OO
6,00
H.OO
It. 00
_.ataa
a. oo
8.00
8.00
A. 00
8»00_
7700 51600 H.OO
7700 51600 ti.OO
7700 51600 8.00
7700 S1601 B.OO
_. ...zziia . ..516P.Q ei.aa__.._._.
TOTAL
NET
SALES
REVENUE,
S/YEAR
NET ANNUAL
INCREASE
(DECREASE)
IN COST OF
POWER,
S
14769200 1927200 12642000
145*1200 1927200 12664000
14413200 1927200 12486000
14235200 1927200 12308000
13ttl*20o" 1927200 11952000
13701200 1927200 11774000
13523300 1927200 11596100
133*5300 1927200 11418100
10H35000~ 1376800 9458200
10657000 1376800 9280200
10479000 1376800 9202200
10301000 1376800 8924200
lQlŁJlDO.___13Z&6fl2_____01*.t>3BD.
82B9400 96*000 7325400
8111400 964000 71*7*00
7933400 964000 6969400
7755400 964000 6791400
15114D2 9*4000 hfeiruoo
50U6400
490H500
4730500
4552500
"41*6100""
401BSOO
3640500
366PAOO
412600
412000
412800
412600
~~412800~
412600
412600
412600
4673600
4495700
4317700
4139700
3783700
3605700
3427700
324S800
CUMULATIVE
NET INCREASE
(DECREASE)
IN COST OF
POWER,
*
126*2000
25506000
37992000
50300000
maaaao
7*382000
86156000
97752100
109170200
129868500
139148700
14B250900
157175100
173246000
160394200
167363600
194155000
205442000
209937700
214255400
216395100
226140500
229746200
233173900
236423700
2mi55HO
TOT 127500 573750000 2390'i'iOB 65Tifli) 43ftHOOfl
LIFETIME AVEHAGE INCREASE inECBfASE) IN UNIT OPEBATINr, COST
DOLLARS PER TON OF tO»L HUHNtU
MILLS PFB KILOKATT-hDUM
CENTS PEW MILLION BTU MEAT IN^UT
HOLLARS PER TOM OF SULFUM flEMIWEO
PROCESS COST niSCOUNTED »T 10.0* To INITIAL YEA»I. DflLLABS
LEVELIZED INCREASE (OECTASFI IN UNIT UPEWATlNlV COST EUUIVALENT TO DISCOUNTED
DOLLARS PFR TOM OK COAL riU^NtU
MILLS PER KILO^ATT-HOHM
CENTS PER MILLION HTU Hf.AT INPUT
DOLLARS PEft TON OF VJLFUH
RECOMPUTATION 1ASIS:
00.01 or MET
274599500 35104009 239*95500
11.49 1.4T 10.02
4.31 0.55 3.76
47.B6 6.12 41.74
420.20 53.72 366.48
113310500 15105000 9820*700
PHOCESS COST OVEH LIFE OF POWEH UNIT
11.01 1.46 9.55
4.13 0.55 3.58
45.R9 6.11 39.78
402.R1 53.79 3*9.11
M? VEMJl'
-------
c»
TABLE B-15. LIMESTONE-GYPSUM PROCESS, 500-MW NEW COAL-FIRED POWER UNIT,
3.5% S IN FUEL, 90% S02 REMOVAL, REGULATED COMPANY ECONOMICS
FIXED INVESTMENT! S 25670000
SULFUR BY-PRODUCT
REMOVED HATE.
YEARS ANNUAL POWER UNIT POWER UNIT BY EQUIVALENT
AFTER OPERA- HEAT FUEL POLLUTION TONS/YEAR
POWER TIONt REOU1REMENT, CONSUMPTION. CONTROL
UNIT KW-HR/ MILLION BTU TONS COAL PROCESS. GYPSUM
START KW /YEAR /YEAH TONS/YF.AH
F 7000 31500000 FilisOO 35VOO 2*0900
2 7000 31500000 1312500 35900 2*0900
3 7000 31500000 1312500 35900 2*0900
4 7000 31500000 1317SOO 35900 2*0900
..5 7288 31522282 1312522 35238 242222.
6 7000 31500000 1312500 35900 2*0900
7 7000 31500000 1312500 35900 2*0900
8 7000 31500000 1312500 35900 2*0900
9 7000 31500000 1312500 35900 2*0900
.12 I2Q.2 315B2282 1312522 35222 242222.
11 5000 22500000 937500 2b600 172100
12 5000 25500000 937SOO 25600 172100
13 5000 22500000 937500 25600 172100
1* 5000 22500000 937500 2boOO 172100
.15 5C22 22555222 231522 25622 122122.
16 3500 15750000 656200 17900 120500
17 3500 15750000 656200 17900 120500
18 3500 15750000 656200 17900 120500
19 3500 15750000 656200 17900 120500
.22 350B 15151510.. 65^221 1Z2U2 „__ .121512.
21 1500 67SOOOO 281200 7700 51600
22 1500 6750000 281200 7700 51600
23 1500 6750000 281200 7700 51600
2* 1500 6750000 281200 7700 51600
.25 1590 675222D 231220 1122 - 51622
26 1500 6750000 281200 7700 51600
27 1500 6750000 281700 7700 51600
28 1500 6750000 281200 7700 51600
29 1500 6750000 281200 7700 51600
.32 1520 6152222 231222 1122 51628.
TOT 1?7500 573750000 73905500 65350ft *388000
LIFETIME AVERAGE INCREASE (DECREASEI IN UNIT OPERATING COST
DOLLARS PER TON OF COAL 6UWNEI1
MILLS PER KILOWATT-HOUR
CENTS PER MILLION BTU MEAT INPUT
DOLLARS PER TON OF SULFUW BEHOVED
PROCESS COST DISCOUNTED AT 10.0* TO INftlAL YEA*. DOLLARS
LEVEXIZEO INCREASE (DECREASE) IN UNIT OPERATING COST EQUIVALENT
DOLLARS PER TON OF COAL BURNtO
MILLS PER KILOWATT-HOUR
CENTS PER MILLION BTU HEAT INPUT
DOLLARS PER TON OF SULFUV REMOVED
NET REVENUEi
J/TON
GYPSUM
TOTAL
OP. COST
INCLUDING NET ANNUAL CUMULATIVE
REGULATED TOTAL INCREASE NET INCREASE
ROI FOR NET (DECREASEI (DECREASE!
POWER SALES. IN COST OF IN COST OF
COMPANY. REVENUE? POWER* PQWERt
J/YEAR J/YEAR J *
10.0*0 1*769200 2*09000 12360200 12360200
10.00 1*591200 2409000 12182200 24542400
10.00 14413200 2409000 12004200 36546600
10.00 14235200 2409000 11826200 48372800
»rfh-^!!HSM^«S--{iJ^S8---?K5ttK
10.00 13701200 2*09000 11292200 82783*00
10.00 13523300 2*09000 1111*300 93897700
10.00 133*5300 2*09000 10936300 10*83*000
11UO.D 13161322 242S2J10. 10150321 US59.230.0
10.00 10H35000 1721000 911*000 12*706300
10.00 10657000 1721000 8936000 1336*2300
10.00 10*79000 1721000 8758000 1*2400300
10.00 10301000 1721000 6580000 1S09S0300
ia»80 1C12JU8 1Z21UC B482111 1583B2110
"lO.OO 8289400 1205000 7084400 166466800
10.00 8111400 1205000 6906400 173373200
10.00 7933400 1205000 6728400 180101600
10.00 7755400 1205000 6550400 186652000
HUJ.8 15ZI5J8 1225121 6312421 12J224110
10.00 5086400 516000 4570400 197594800
10.00 4908500 516000 4392500 201987300
10.00 4730500 516000 4214500 206201800
10.00 4552500 516000 4036500 210238300
12»!2__«_ 43145J2 514021 3850521 21*026620
10.00 4196500 516000 3680500 217777300
10.00 4018500 516000 3502500 221279800
10.00 3840500 516000 3324500 224604300
10.00 3662600 516000 3146600 227750900
ll«.18 3.4H46J11 51612 fl 2250611 2,3.1113510
274599500 43880000 230719500
11.49 1.84 9.65
4.31 0.69 3.62
47.86 7.65 40.21
420.20 67.15 353.05
113310500 18882200 94428300
TO DISCOUNTED PROCESS COST OVER LIFE OF POWER UNIT
11.01 1.83 9.18
4.13 0.6) 3.4*
45.89 7.6* 38.25
*02.B1 67.12 335.69
-------
APPENDIX C
CHARACTERISTICS OF THE POWER UTILITY INDUSTRY
CONTENTS
Table
C-l Consumption Pattern of Fossil Fuels in the United States,
1969-73 195
C-2 Historical Fossil Fuel Characteristics for the Period
1969-73 195
C-3 Projected 1978 Fossil Fuel Consumption Rates and
Characteristics 196
C-4 Comparison of Projected 1978 Regional Fossil Fuel
Consumption with 1973 Consumption 197
C-5 Conventional Fossil-Fueled Steam-Electric Generating
Plants, Total and Average Capacities, Net Generation and
Capacity Factors for the Total Power Industry, 1938-73. . . 204
C-6 Fifteen Largest Steam-Electric Plants in the United
r-7
C-8
Trends in Boiler Size 1959-73
Distribution of Boilers by Age and Capacity Factor -
All Boilers
207
208
C-9 Distribution of Boilers by Age and Capacity Factor -
Boilers Out of Compliance 210
C-10 Distribution of Boilers by Size and Capacity Factor -
All Boilers 210
C-ll Distribution of Boilers by Size and Capacity Factor -
Boilers Out of Compliance 211
C-12 National Average Heat Rates for Fossil-Fueled Steam-
Electric Plants - Total Electric Power Industry,
1938-73 212
191
-------
Figure Page
C-l Trends in the consumption of coal, oil, and gas
from 1969-78 198
C-2 Location of coal-fired steam-electric power plants .... 200
C-3 Location of oil-fired steam-electric power plants 201
C-4 Location of gas-fired steam-electric power plants 202
C-5 Location of steam-electric power plants capable of
utilizing alternative fossil fuels 203
C-6 General layout of a power plant designed with an FGD
system 205
C-7 Average boiler capacity factors as a function of boiler
age based on 1969-73 FPC data 209
192
-------
APPENDIX C
CHARACTERISTICS OF THE POWER UTILITY INDUSTRY
In the power industry, either fossil or nuclear fuel is used to
generate steam. The steam generated in the boilers is fed to steam
turbines which drive generators for producing electricity. Fossil fuel
is a general term which refers to either coal, oil, or natural gas.
Most coal and oil contain sulfur which during combustion in the boiler
is emitted as S02 in the stack gas. Natural gas may contain some sulfur,
but in relatively small amounts. Nuclear fuels do not contain sulfur and
are not consumed in the same manner as fossil fuels; therefore, their
use does not result in the emission of 502- In presenting characteristics
of the power industry below, emphasis is placed on fossil-fired plants
which use coal, oil, or natural gas to generate steam.
Detailed information related to the characteristics of the steam-
electric utility industry is found in "Steam-Electric Plant Construction
Cost and Annual Production Expenses" (FPC-S-250) (1) and "Steam-Electric
Plant Air and Water Quality Control Data" (FPC-S-253) (2). Key informa-
tion given in these publications is included below to characterize the
utility industry.
FOSSIL FUELS
During the decade prior to 1967, about 66% of the total annual
fossil-fueled power generation was by coal, about 26% by natural gas,
and the remaining 8% by residual oil. During the second half of the
past decade, when restrictions on the importation of residual oil were
removed on the east coast, foreign residual oil began to compete favor-
ably with other fuels. Electric utilities, particularly those near
deepwater ports, started to convert from coal to oil and to build new
oil-fired units. This process was accelerated with the setting forth of
strict sulfur oxide emission control regulations. With the growing
shortage in the supply of natural gas, the use of desulfurized or naturally
low-sulfur oil offered the most viable solution to the sulfur oxide pollu-
tion problem along the entire east coast.
1. Federal Power Commission. Steam-Electric Plant Construction Cost
and Annual Production Expenses. Twenty-Sixth Annual Supplement-1973,
FPC S-250, April 1975. 185 pp.
2. Federal Power Commission. Steam-Electric Plant Air and Water Quality
Control Data, for the year ended December 31, 1973, based on FPC Form
67, FPC S-253, January 1976. 184 pp.
193
-------
A large proportion of the oil used by electric utilities, partic-
ularly along the eastern seaboard, is of foreign origin. In the 1965-72
period, about 398 coal-fired generating units were converted to the use
of oil. Economic considerations dictated the conversions initially.
More recently, however, the paramount reason for converting to oil has
been the requirement to meet strict sulfur emission regulations which
the utilities were unable to do using coal. Most of the conversions
took place on the east coast at plants with easy access to ocean and
river barge transport of lower priced, desulfurized, or naturally low-
sulfur imported residual oil. The Arab oil embargo in late 1973 was
instrumental in effecting arbitrary and sudden, huge price increases in
the world price of oil. In a relatively short period of time, the
economic advantage of using imported oil versus coal as a fuel for
electric power generation reversed. In early 1974 a number of utilities
on the east coast reported 42 oil-burning plants of their systems'
capacities as having capability of conversion from oil to coal. A few
of these plants have been converted to coal, with conversion by the
others contingent upon coal availability. Due to current uncertainties
in the long-range oil supply picture and the increasing amounts of
nuclear generation becoming available to electric utilities, oil's role
in electric generation will probably decline in the future.
Historical Consumption and Characteristics
The historical consumption pattern of coal, natural gas, and oil
in the United States from 1969 through 1973 based on FPC Form 67 data" is
shown in Table C-l. Historical characteristics of coal, oil, and gas
for the corresponding period are given in Table C-2. The data indicate
that the average heating value of coal, fuel oil, and gas has declined
slightly during this period. The data also show a slight decline in the
average sulfur content of coal and a significant decline in the average
sulfur content of oil. The lower heating values of coal and fuel oil
appear to be at the expense of using fuels with lower sulfur contents.
The average ash content of coal during the same period increased from
about 12.5 to 13.3%.
194
-------
TABLE C-l. CONSUMPTION PATTERN OF FOSSIL FUELS IN
THE UNITED STATES, 1969-73 (1)
Total Btu (1015)
Year
1969
1970
1971
1972
1973
Coal
7.065
7.098
7.244
7.794
8.583
Oil
1.577
2.008
2.328
2.816
3.270
Gas
3.429
3.820
3.841
3.811
3.517
Total
12.071
12.926
13.413
14.421
15.370
% of total
Coal
58.5
54.9
54.0
53.9
55.8
Oil
13.1
15.5
17.4
19.6
21.3
Btu
Gas
28.4
29.6
28.6
26.5
22.9
TABLE C-2. HISTORICAL FOSSIL FUEL CHARACTERISTICS
FOR THE PERIOD 1969-73 (1)
Year
1969
1970
1971
1972
Ib S02/MBtu
Average ash content, % by wt
Fuel Oil
Average heating value,
Btu/gal
Average sulfur content, % by
wt
Equivalent S02 content,
Ib S02/MBtu
Gas
4.46
12.53
4.58
13.72
4.42
13.85
4.28
13.41
1973
Coal
Average heating value, Btu/lb 11,628 11,276 11,169 11,176 11,090
Average sulfur content, % by wt 2.59 2.58 2.47 2.39 2.32
Equivalent S02 content,
4.27
13.29
148,727 147,991 147,017 146,285 145,772
1.68 1.52 1.28 1.07 0.98
1.80 1.64 1.40 1.18 1.08
Average heating value, Btu/ft3 1,033 1,031 1,030 1,028 1,028
1. Federal Power Commission. Steam-Electric Plant Air and Water Quality
Control Data, for the year ended December 31, 1973, based on FPC Form
67, FPC S-253, January 1976. 184 pp.
195
-------
Projected 1978 Consumption and Characteristics
In 1973 utilities were also requested by the FPC to project fuel
consumption and characteristics for 1978. The majority of utilities
provided FPC with these projections. For the utilities which did not
project this information, fuel consumption and characteristics were
assumed to be the same as that reported for 1973. Based on the updated
projections, Table C-3 shows the consumption rates and characteristics
of fossil fuels projected to be used during 1978.
A comparison of the total projected 1978 coal, fuel oil, and gas
consumption with the historical 1973 fuel consumption by region is shown
in Table C-4. Figure C-l shows the overall trend in fossil fuel consumption
from 1969 through 1978. The projections indicate a general increase in
the consumption of coal and oil, but a slight decrease in the consumption
of gas. The regional increases or decreases are primarily influenced by
fuel availability and price. In reviewing the data, it must be remembered
that a significant amount of new generating capacity between 1973 and
1978 is from nuclear units. The data shown include the effect of pro-
jected decreases in fossil fuel utilization as a result of new nuclear
units coming online as well as changes in fossil fuel consumption resulting
from decreases in fuel availability or increases in cost.
TABLE C-3. PROJECTED 1978 FOSSIL FUEL CONSUMPTION
RATES AND CHARACTERISTICS
All plants
Plants out
of compliance
Coal
Total consumption
ktons
109 Btu
Heating value, Btu/lb
Sulfur content, % by wt
Equivalent SC>2 content, Ib S02/MBtu
Oil
Total consumption
kbbl
109 Btu
Heating value, Btu/gal
Sulfur content
Equivalent S02 content, Ib S02/MBtu
Gas
Total consumption
Mft3
109 Btu
Heating value, Btu/ft^
475,570
10,408,290
10,943
2.12
3.87
620,247
3,827,427
146,924
0.99
1.08
2,556,021
2,602,232
1,018
226,780
5,125,075
11,300
2.81
4.97
110,167
686,900
148,454
1.42
1.54
108,239
116,968
1,081
196
-------
TABLE C-4. COMPARISON OF PROJECTED 1978 REGIONAL
FOSSIL FUEL CONSUMPTION WITH 1973 CONSUMPTION
Geographic region
Coal,
ktons
Oil,
kbbl
Gas,
Mft3
Historical 1973 Consumption (1)
New England
Middle Atlantic
East North Central
West North Central
South Atlantic
East South Central
West South Central
Mountain
Pacific
U.S. Total
1,078.2
46,993.3
135,959.4
31,623.2
75,860.1
63,060.9
4,733.3
23,928.4
3,741.0
82,930.0
144,692.4
23,337.9
3,442.9
141,382.4
6,513.8
20,847.0
8,989.3
76,965.5
6,070.2
64,728.9
105,593.6
352,816.6
202,664.9
73,749.3
1,957,067.4
207,631.7
451,217.3
386,977.8 509,101.2 3,421,519.9
Projected 1978 Consumption
U.S. Total
475,570
620,247
2,556,021
The states included in each geographic region are:
New England - CT, ME, MA, NH, RI, VT; Middle Atlantic - NJ, NY, PA;
East North Central - IL, IN, MI, OH, WI; West North Central - IA,
KS, MN, MO, NE, ND, SD; South Atlantic - DE, DC, FL, GA, MD, NC,
SC, VA, WV; East South Central - AL, KY, MS, TN; West South Central
AR, LA, OK, TX; Mountain - AZ, CO, ID, MT, NV, NM, UT, WY; Pacific -
CA, OR, WA.
Regional consumption data not available.
1. Federal Power Commission. Steam-Electric Plant Air and Water Quality
Control Data, for the year ended December 31, 1973, based on FPC Form
67, FPC S-253, January 1976. 184 pp.
197
-------
m
rH
o
rH
X
8
20.0
19.0
18.0
17.0
16.0
15.0
14.0
13.0
12.9
11.0
10.0
9.0
8,6
7.0
6.0
5.0
4.0
3.0
2.0
1.0
• Total
D Coal
A Gas
O Oil
I I
- Projected
Actual
^J
•»**
1969
1970
1971
1972
1973
1978
YEAR
Figure C-l. Trends in the consumption of coal, oil, and gas from 1969-78.
198
-------
POWER PLANT CHARACTERISTICS
Plant Location
The locations of major coal-, oil-, and gas-fired steam-electric
power plants based on 1973 FPC data are shown in Figures C-2 through C-4
respectively. Figure C-5 shows the location of plants which use multiple
fuel mixes for the same period. The data show coal-fired plants to be
scattered from the east to the west coast. The highest concentration of
coal-fired plants is in the Midwest. Oil-fired power plants are most
predominant along the east and west coasts and the lower Mississippi
Valley; however, they are also found at other scattered locations in the
Midwestern States. Gas-fired plants are predominant near the Louisiana
and Texas Gulf Coast and adjacent states, but like oil-fired plants, are
also found at other locations. At the end of 1973, plants with facilities
for using multiple fuels were widely scattered.
Plant Size
Historical data for conventional fossil-fueled steam-electric
generating plants for the total power industry are shown in Table C-5.
An analysis of these data indicates that total fossil-fueled power
generation has generally doubled every 10 years. New plants are con-
structed to (1) provide additional capacity for the increasing elec-
trical demand and (2) provide replacement capacity for older, less
efficient plants which are being retired. The total installed steam-
electric generating capacity from fossil-fueled plants increased from 26
kMW in 1938 to over 318 kMW in 1973. During the same period, average
plant size in megawatts increased from 22 to 322. The total number of
plants varies annually as new plants are built and old plants are retired.
At the end of 1973, there were 219 fossil-fueled plants 500 MW or larger.
Most power plants consist of a number of separate units which are
capable of producing power independently of the other units within the
plant. Each unit generally includes a separate boiler for generating
steam, a separate turbine and generator for producing electricity, and
separate flue gas handling facilities. Although some plants have common
flue gas stacks for multiple boilers, most boilers are designed with
separate stacks. Modular units allow for servicing and maintenance
without significantly affecting the output of the overall plant and
allows for the addition of new generating capacity without interfering
with the operation of the existing facilities.
A diagram showing the general layout of a plant, including facil-
ities for SC«2 control, is shown in Figure C-6. This diagram illustrates
the relationships between plant, boilers, stacks, and facilities for
controlling S02 emissions.
199
-------
I 9
O
O
Coal users
Figure C-2. Location of coal-fired steam-electric power plants,
-------
I _>
o
D Oil users
Figure C-3. Location of oil-fired steam-electric power plants
-------
N)
O
I J
Gas users
Figure C-4. Location of gas-fired steam-electric power plants.
-------
Combination users
Figure C-5. Location of steam-electric power plants
capable of utilizing alternative fossil fuels.
-------
TABLE C-5. CONVENTIONAL FOSSIL-FUELED STEAM-ELECTRIC GENERATING PLANTS,
TOTAL AND AVERAGE CAPACITIES, NET GENERATION AND CAPACITY FACTORS
FOR THE TOTAL POWER INDUSTRY, 1938-73a'b (1)
1938 1947 1957 1967 1971 1972
Number of plants 1,165 1,045 1,039 971 985 979
1973
988
Installed capac-
ity, MW 26,066 36,035 99,500 210,237 275,593 294,049 318,357
Average plant
size, MW 22 35 96 217 280 300 322
Net generation,
GkWh 68.4 174.5 497.2 974.1 1,282.2 1,378.3 1,459.2
Approximate
average annual
plant factor, % 35 55 57 53 53 54 52
a. Excludes Puerto Rico.
b. Excludes nuclear, geothermal, gas turbine, and internal combustion plants,
BOILER CHARACTERISTICS
Boiler Size
As an illustration of the size relationship between plants and
boilers, Table C-6 identifies the total plant size in megawatts and the
number of separate units for the 15 largest steam-electric plants in the
United States based on 1973 FPC data. These plants range in size from
1872, to 2933 MW. For comparison, individual boiler sizes at these
plants range from 69 to 1300 MW. The average boiler size considering
all boilers projected to be operational in 1978 is 122 MW and the
average boiler size for plants which are projected to be out of com-
pliance in 1978 is 159 MW.
The average size of larger boilers (greater than 300 MW) placed in
service has generally increased over the years. Table C-7 shows the
number of units, corresponding total megawatts, and the average unit
size in megawatts for units placed in service during the period 1959-73.
1. Federal Power Commission. Steam-Electric Plant Construction Cost
and Annual Production Expenses. Twenty-Sixth Annual Supplement-1973,
FPC S-250, April 1975. 185 pp.
204
-------
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HANl
GAS TO S^ '
STAC K X^
S.
FAN
f
JBBER
1
JBBER
-J
SULFUR,
SCRUBBER ACID
SLURRY OR WASTE
DISPOSAL
FACILITIES
BYPRODUCT
RAW MATERIAL
FACILITIES
Figure C-6, General layout of a power plant designed with an FGD system.
-------
TABLE C-6. FIFTEEN LARGEST STEAM-ELECTRIC PLANTS
IN THE UNITED STATES IN 1973a (1)
Plant name
MWC
Units
Utility
Amos
Paradise
Labadie
Monroe
Sammis
Robinson, P. H.
Four Corners
Moss Landing
Alamitos
Pittsburg
Marshall
Widows Creek
Nine Mile Point
St. Clair
Keystone
2,933
2,558
2,482
2,462
2,456
2,315
2,270
2,175
2,121
2,029
2,000
1,978
1,917
1,905
1,872
3
3
4
3
7
4
5
7
6
7
4
8
5
7
2
Appalachian Power Company
Tennessee Valley Authority
Union Electric Company
Detroit Edison Company
Ohio Edison Company
Houston Lighting and Power Company
Arizona Public Service Company
Pacific Gas and Electric Company
Southern California Edison Company
Pacific Gas and Electric Company
Duke Power Company
Tennessee Valley Authority
Louisiana Power and Light Company
Detroit Edison Company
Pennsylvania Power and Light Company
a. Coal-fired
except as
noted.
b. Based on maximum generator
ratings.
1. Federal Power Commission. Steam-Electric Plant Construction Cost
and Annual Production Expenses. Twenty-Sixth Annual Supplement-1973,
FPC S-250, April 1975. 185 pp.
206
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TABLE C-7. TRENDS IN BOILER SIZE, 1959-73 (1)
Fossil-fueled units 300 MW and larger
Number units
placed in Total, Average unit
Year service MW size, MW
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
5
8
9
7
10
10
17
20a
26
22
26
25
29
32
35
1,800
2,525
3,180
2,525
4,500
3,625
7,740
8,424
13,245
12,274
14,249
14,413
17,575
18,753
21,843
360
317
353
361
450
362
455
421
509
558
548
577
606
586
624
Total 281 146,671 ' 522
a. Seven of these units were actually in-
stalled in prior years and were rerated
in 1966.
1. Federal Power Commission. Steam-Electric Plant Construction Cost
and Annual Production Expenses. Twenty-Sixth Annual Supplement-1973,
FPC S-250, April 1975. 185 pp.
207
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Boiler Capacity Factors
The data given in Table C-5 indicate that average annual capacity
factors for power plants ranged from about 52 to 57% of rated capacity
for the period 1947-73. In contrast, however, capacity factors for
individual boilers within a plant vary considerably. As new units are
added, load factors for the older units are generally decreased and the
newer, more efficient units are operated at higher capacity factors.
However, delays in construction of new generating capacity often require
older plants to operate at higher than normal capacity factors. Based
on historical FPC data for 1967-73, the average annual capacity factors
for all boilers as a function of boiler age were determined and are
shown in Figure C-7. The data indicate a gradual increase in capacity
factors from about 50 to 65% during the first 10 years of operation
followed by a relatively constant profile for approximately 5-7 years
and a gradually declining operating profile over the remaining life of
the plant. Boilers greater than 20 years old generally operate at
annual capacity factors less than 50%, A breakdown of the projected
1978 distribution of all boilers by age and capacity factor is shown in
Table C-8. Table C-9 shows the distribution for these boilers projected
to be out of compliance.
TABLE C-8. DISTRIBUTION OF BOILERS BY AGE AND CAPACITY FACTOR - ALL BOILERS
Number
Boiler
age, yr
0-5
6-10
11-15
16-30
>30
of boilers
and (% of total number
Boiler capacity
<20%
28
30
20
265
1009
( o
( o
( o
( 7
(29
.8)
.9)
.6)
.9)
.8)
20-40%
26 ( 0.8)
34 ( 1.0)
45 ( 1.3)
410 (12.1)
154 ( 4.6)
41-60%
84 ( 2.5)
92 ( 2.7)
73 ( 2.2)
465 (13.7)
61 ( 1.8)
factor
40
127
120
274
25
>60%
( 1.
( 3.
( 3.
( 8.
( o.
of
boilers)
Total
2)
8)
5)
1)
7)
178 (
283 (
258 (
1414 (
1249 (
5
8
7
41
36
.3)
.4)
.6)
.8)
.9)
Total 1352 (40.0) 669 (19.8) 775 (22.9) 586 (17.3) 3382 (100.0)
Boiler capacity factors also vary as a function of plant size.
Larger boilers are often operated as base-load plants while the older,
generally smaller and less efficient boilers are operated to provide
peaking capacity. Table C-10 shows a breakdown of the projected 1978
distribution of all boilers by size and capacity factor. Table C-ll shows
the distribution for these boilers projected to be out of compliance.
Capacity factors are also a function of fuel type; however, plant
design is the primary consideration which affects the consumption-
distribution pattern. For plants which are capable of burning alternate
fuels, however, the utilization trend changes as a function of fuel
availability and costs.
208
-------
K)
O
ss
Q
W
H
H
S3
W
O
Pi
W
g
H
o
U
g
s
10
BOILER AGE YEARS
Figure C-7. Average boiler capacity factors as a function of boiler age based
on 1969-1973 FPC data.
-------
TABLE C-9. DISTRIBUTION OF BOILERS BY AGE AND
CAPACITY FACTOR - BOILERS OUT OF COMPLIANCE
Number
Boiler
age, yr
0-5
6-10
11-15
16-30
>30
Total
of
boilers
and (%
of total number
Boiler capacity
<20%
5
9
4
56
216
290
( o
( 1
( o
( 6
(25
(34
.6)
.1)
.5)
.7)
.9)
.8)
20-40%
8
5
5
90
38
146
( 1.0)
( 0.6)
( 0.6)
(10.8)
( 4.6)
(17.6)
4
49
26
16
135
13
239
1-60%
( 5.9)
( 3.1)
( 1.9)
(16.2)
( 1.6)
(28.7)
factor
>60%
19 ( 2
45 ( 5
26 ( 3
66 ( 7
2 ( 0
158 (18
of
boilers)
Total
.3)
.4)
.1)
.9)
.2)
.9)
81 (
85 (
51 (
347 (
269 (
833 (
9.8)
10.2)
6.1)
41.6)
32.3)
100.0)
TABLE C-10. DISTRIBUTION OF BOILERS BY SIZE AND
CAPACITY FACTOR - ALL BOILERS
Boiler
size, MW
<200
200-500
501-1000
>1000
Number
<20%
1270
53
29
0
(37.6)
( 1.6)
( 0.8)
( 0.0)
of boilers and
Boiler
20-40%
601
45
21
2
(17.8)
( 1.3)
( 0.6)
( 0.1)
(% of total number
capacity
41-60%
510 (15.1)
180 ( 5.3)
79 ( 2.3)
6 ( 0.2)
factor
390
120
76
0
>60%
(11
( 3
( 2
( o
of
boilers)
Total
.5)
.5)
.3)
.0)
2771 (
398 (
205 (
8 (
82.
11.
6.
0.
0)
7)
1)
2)
Total 1352 (40.0) 669 (19.8) 775 (22.9) 586 (17.3) 3382 (100.0)
210
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TABLE C-ll. DISTRIBUTION OF BOILERS BY SIZE AND
CAPACITY FACTOR - BOILERS OUT OF COMPLIANCE
Number of boilers and (% of total number of boilers)
Boiler Boiler capacity factor
size, MW <20% 20-40% 41-60% >60% Total
<200 283 (34.0) 129 (15.5) 129 (15.5) 87 (10.4) 628 ( 75.4)
200-500 7 ( 0.8) 12 ( 1.4) 69 ( 8.3) 38 ( 4.6) 126 ( 15.1)
501-1000 0 ( 0.0) 5 ( 0.6) 36 ( 4.3) 33 ( 4.0) 74 ( 8.9)
>1000 0 ( 0.0) 0 ( 0.0) 5 ( 0.6) 0 ( 0.0) 5 ( 0.6)
Total 290 (34.8) 146 (17.5) 239 (28.7) 158 (19.0) 833 (100.0)
Boiler Heat Rates
Because heating values of fossil fuels vary over a wide range, the
thermal efficiency of fossil-fueled steam-electric power plants is
generally expressed in terms of heat rate. Heat rate is defined as the
total Btu of heat required to generate 1 kWh of electricity for delivery
to the transmission system. These data are reported annually to FPC at
the utility, plant, and boiler level. Table C-12 shows historical
national average heat rates for fossil-fueled power plants from 1938-73.
This table also shows the thermal efficiency for converting heat energy
into electricity, which is calculated by dividing the thermal equivalent
of 1 kWh (3413 Btu) by the heat rate. As shown, national average heat
rates have declined from a high of 16,500 Btu/kWh in 1938 to about
10,400 Btu/kWh in 1972-73.
According to FPC data, there were 14 units in 1973 with heat rates
of less than 9 kBtu/kWh compared with 18 units in 1972. The most efficient
single unit had a heat rate of 8714 Btu/kWh in 1973. Corresponding to
1973, there was a total of 41 plants with overall heat rates of less
than 9,500 Btu/kWh and 124 plants with heat rates under 10,000 Btu/kWh.
These totals account for 19 and 45% of the total electrical generation
respectively. The most efficient single plant had an average heat rate
of 8818 Btu/kWh. Based on projections to 1978, plant heat rates will range
from 8,818 to greater than 30,000 Btu/kWh.
The most efficient heat rate at the company level was reported as
9524 Btu/kWh. In 1973 there was a total of 16 utilities with heat rates
less than 10 kBtu/kWh.
211
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TABLE C-12. NATIONAL AVERAGE HEAT RATES FOR FOSSIL-FUELED STEAM-ELECTRIC
PLANTS - TOTAL ELECTRIC POWER INDUSTRY, 1938-73 (1)
Year
1938
1948
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
Btu/net
kWh
16,500
15,738
13,361
12,889
12,180
11,699
11,456
11,365
11,085
10,970
10,760
10,650
Thermal
efficiency,
%
20.68
21.69
25.54
26.48
28.02
29.17
29.79
30.03
30.79
31.11
31.72
32.05
Year
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1973
Btu/net
kWh
10,558
10,482
10,462
10,453
10,415
10,432
10,398
10,447
10,494
10,478
10,379
10,389
Thermal
efficiency,
%
32.33
32.56
32.62
32.65
32.77
32.72
32.82
32.67
32.52
32.57
32.88
32.85
a. Based on 3,413 Btu as the energy equivalent of 1 kWh.
1. Federal Power Commission. Steam-Electric Plant Construction Cost
and Annual Production Expenses. Twenty-Sixth Annual Supplement-1973,
FPC S-250, April 1975. 185 pp.
212
-------
APPENDIX D
S02 EMISSION REGULATIONS AND APPLICATIONS
CONTENTS
Tables Page
D-l Units for Expressing State S02 Emission Regulations ... 216
213
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APPENDIX D
S02 EMISSION REGULATIONS AND APPLICATIONS
With the passage of the Clean Air Acts of 1963, 1967, and 1970, EPA
was given the responsibility and authority to regulate and control air
pollution in the United States and its territories. Among other responsi-
bilities, the Clean Air Act required EPA to put into effect National
Ambient Air Quality Standards (NAAQS) for pollutants which adversely
affect public health and welfare, including S02, nitrogen dioxide,
particulate matter, carbon monoxide, hydrocarbons, and photochemical
oxidants.
STATE IMPLEMENTATION PLANS
The Clean Air Act required each state to adopt and submit to EPA an
acceptable plan for attaining, maintaining, and enforcing NAAQS in all
regions of the state. These State Implementation Plans (SIP) prescribed
emission limiting regulations, timetables for compliance with the limi-
tations, and measures required to ensure attainment of the standards.
Unacceptable plans were returned to the states for revision or, in some
cases, substitute regulations were established by EPA. While the
primary responsibility for enforcing SIP regulations rests with the
individual states, EPA is responsible for assuring that all implementa-
tion plan requirements are fulfilled. As a result, EPA provides technical
and legal assistance to the states in enforcing SIP regulations. If any
state fails to enforce its implementation plan regulations, the Federal
Government may take legal actions against the noncomplying sources.
Following initial approval of most SIP in 1972, many states began
submitting to EPA revisions to their implementation plan, many of which
alter the emission limitations. Usually, these revisions are based on
additional air quality measurement data or on a more detailed technical
analysis of air pollution control strategies. When approved by EPA,
these revisions become a part of the implementation plan.
FEDERAL NEW SOURCE PERFORMANCE STANDARDS
In addition to the SIP limitations, emissions from certain sources
are restricted further by the Federal New Source Performance Standards
(NSPS).
214
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The purpose of these standards is to prevent the occurrences of new
air pollution problems, encourage improvements in emission control tech-
nology, and provide a mechanism for controlling pollutants which EPA
suspects are hazardous, but for which insufficient information is avail-
able to regulate under other provisions of the Act.
The standards are applicable to newly constructed facilities, new
equipment additions to existing facilities, and existing equipment which
is modified in such a way that an increase of pollutant emissions occurs.
NSPS is in most cases more stringent than SIP.
TRENDS IN ESTABLISHING SIP
Over the past few years, much attention has been focused on emission
regulations for sulfur oxides since these regulations impact the supply
of fuel, particularly coal, which can be burned to produce electrical
energy. While U.S. supplies of coal are plentiful, some of this coal is
too high in sulfur content to be burned in compliance with State and
Federal regulations for SC>2 without the use of emission reduction systems,
which in some cases, are either costly or impractical. As a result,
many states have been reevaluating their sulfur oxide regulations to
ensure that scarce low-sulfur fuels are being required only in areas
where they are needed to protect public health. In some cases, states
have revised their sulfur regulations to allow the burning of higher-sulfur
fuels in less polluted areas where they can be burned without violating
ambient air quality standards.
EMISSION CONTROL REGULATIONS FOR FOSSIL-FIRED POWER GENERATORS
Units of the Regulation
NSPS contains distinct regulations which limit the emission of
particulate and S02 from individual fossil-fired boilers as shown
below.
Allowable emission,
Ib/MBtu heat input
Coal-fired unit Oil-fired unit
Particulate 0.1 0.1
S02 1.2 0.8
This regulation is applicable to boilers in which construction or
modification was begun after August 17, 1971.
215
-------
In contrast to NSPS regulations, there are variations in (1) the
units of measure in which SIP regulations for existing plants are
expressed, (2) the equipment (boiler, stack, or entire plant) to which
the regulations apply, and (3) the value of the regulation. Table D-l
shows the units in which SIP regulations are expressed (1).
TABLE D-l. UNITS FOR EXPRESSING STATE
SO EMISSION REGULATIONS (1)
1. % sulfur for all fuels.
2. % sulfur for each fuel.
3. Ib S02/MBtu for all fuels.
4. Ib S02/MBtu for each fuel.
5. Ib sulfur/MBtu for all fuels.
6. Ib sulfur/MBtu for each fuel.
7. ppm S02 in exhaust gas.
8. Impact on ambient air quality in ppm.
9. Ib S02/hr.
Some states control all emission sources equally, while other
states prescribe different emission limits for sources according to the
fuel used, the geographic location, the size of the source, or the type
of source (e.g., power plant or other combustion units).
1. U.S. Environmental Protection Agency. State Implementation Plan
Emission Regulations for Sulfur Oxides: Fuel Combustion. EPA-
450/2-76-002 (NTIS PB 251 174), March 1976.
216
-------
The most common regulation for controlling SC>2 emissions is by
either limiting the amount of sulfur or S02 emitted per unit heat input
(pound sulfur/MBtu, pound S02/MBtu) or limiting the sulfur content of
the fuel (% sulfur). However, other SC>2 regulations limit SC>2 emission
concentrations expressed as parts of SC>2 per million parts by volume of
stack gas (ppm S02) or limit the amount of S02 emitted per hour (pound
S02/hour). Some states or regions specify ambient air quality regulations
only (i.e., no specific emission limit for a source). Other methods of
limiting SC^ emissions which appear in the SIP include requiring a
percent control of input sulfur (% control) and requiring application of
"latest reasonably available control technology" or "new proven technologies."
Some of the above-mentioned methods for regulating S02 control the
emissions of sulfur oxides more directly than do others, and each method
has different implications regarding fuels that can be legally burned.
A detailed discussion of the effect of different applications of
the SIP regulations on degree of 862 removal is included in State
Implementation Plan Emission Regulations for Sulfur Oxides; Fuel
Combustion (1).
Application of the Regulations
Besides the various units of measure used, regulations also vary as
to the equipment upon which the emission limit is enforced. Twenty-five
states or territories enforce their regulations on a boiler basis, 13 on
a stack basis, and 18 on a total plant basis (all boilers collectively).
In considering compliance with a regulation, this information determines
whether a source is allowed to average its emission over all boilers (or
stacks) or if each boiler (or stack) must comply with the regulation.
About one-third of the states regulate specific fuel types. These
regulations usually control oil-fired sources more strictly than coal-
fired sources since, in general, oil contains less sulfur and has a
higher heat content than does coal. But, in some cases, the sulfur restric-
tion for coal is more stringent than the restriction for oil to prohibit
the use of coal without flue gas cleaning equipment.
About half of the states have specific SC>2 regulations for various
geographic areas within the state. These geographic areas might be
specified as cities, counties, Federal Air Quality Control Regions
(AQCR), Standard Metropolitan Statistical Areas (SMSA), or some locally
defined geographic region. In some areas, including Arizona, New Mexico,
and Puerto Rico, regulations have been promulgated which apply to specific
plants.
1. U.S. Environmental Protection Agency. State Implementation Plan
Emission Regulations for Sulfur Oxides: Fuel Combustion. EPA-
450/2-76-002 (NTIS PB 251 174), March 1976.
217
-------
In about one-third of the states, the size of the source determines
whether or not the source must comply with an S02 emission limitation
and if so, the stringency of the limitation. In most cases, source size
is defined by the heat input rate measured in millions of Btu per hour
(MBtu/hr). Other methods of defining source size include pounds of
steam generated per hour (Ib steam/hr) and emission potential in tons of
S02 emitted per year (tons SC^/yr). In some states, emission limit is
determined by the heat input range under which a source falls. In these
states, larger sources usually are controlled more stringently than
smaller sources.
Over half of the states use more than one of the parameters discussed
above in their regulations. In addition, about 35% of the states have
separate regulations for new sources and about 10% have regulations for
existing sources that become more stringent over time.
In a few states, the limits on emissions or fuel quality are speci-
fied as maximum values averaged over a given time period. Most regula-
tions, however, state that emissions or sulfur content shall not exceed
a maximum value.
PROCEDURE FOR UTILIZING FPC DATA TO ESTIMATE COMPLIANCE STATUS
Each utility is required by law to report annually to FPC plant,
boiler, and fuel characteristics for their steam-electric generators on
FPC Form 67. A file containing FPC Form 67 data for the period 1969-73
was supplied to TVA along with utility projections, where available, of
similar data for 1978 for use in the byproduct marketing study. The
data were primarily for use in projecting S02 emissions at power plants
for determining the compliance status of power plants with State and
Federal S02 emission regulations and the market potential for sulfur and
sulfuric acid abatement production at plants which are out of compliance.
TVA developed a procedure for using the Form 67 data in conjunction
with applicable S02 emission regulations to (1) project the compliance
status of individual plants and the quantity of sulfur which must be
recovered to meet S02 emission regulations for those plants out of
compliance, (2) estimating costs for removing the required amount of S02
from the gas to meet compliance requirements by four alternative scrubbing
processes, and (3) comparing the costs for scrubbing including credit
from sale of byproducts with alternative costs for complying with the
regulation by the use of low-sulfur coal. The overall comparison is
used to assist in selecting the minimum cost compliance alternative.
Discussions of the data required for input to the scrubbing cost generator
and the method for developing the model are given below.
218
-------
FPC Form 67 Data Projections
The projected 1978 FPC Form 67 data which serve as input to both
the SC>2 emission and compliance model and the scrubbing cost generator
include a number of key data items which were reported to FPC at the
plant level only. In the compliance tests and the scrubbing cost gen-
erator the majority of the calculations are begun at the boiler level;
therefore, it was necessary to project much of the plant level data to
the boiler level for input to these models. Plant level data available
from either 1978 projections or historical 1969-73 data updated with
more current information from FPC include plant capacity in MW, overall
projected plant capacity factor, fuel consumption breakdown as coal,
oil, and gas, plant heat rate in Btu/kWh, heating values of coal, oil,
and gas, and sulfur contents of coal and oil. At the boiler level, the
following data are available from similar sources: boiler startup year,
boiler capacity in MW, and design air rates to the boiler at full load
expressed in sft-Vminute. Fuel is allocated from the plant level to the
boiler level from either utility projections for 1978 or historical
1969-73 consumption. For the cases in which utilities projected plant
level data, the data were generally used as projected. For the other
cases where historical plant data were used, projections at the boiler
level were adjusted in accordance with the historical boiler age-capacity
factor relationship which was described earlier. In all cases, data
projections and adjustments at the boiler level are allowed to override
the plant level data. The projections of fuel consumptions are reported
in terms of billion Btu per year (GBtu/yr) for each fuel at each boiler
for convenience in comparing the relative fuel distribution, and individual
boiler capacity factors (annual) are calculated.
Since individual boiler heat rates are not included in the FPC data
file, the overall plant heat rates were assumed to be applicable for
each boiler in the plant. Reported air rates to the boiler are compared
with calculated air rates as a check of the data file. If reported air
rates differ from calculated rates by greater than 25%, calculated air
rates are allowed to override the reported rates.
The FPC data file is used by the compliance test model to project
S02 emissions for each boiler and plant for comparison with allowable
emissions. The compliance test procedure is discussed below.
Compliance Test
The S02 emission and compliance model uses the projected annual
fuel consumption and characteristics data to calculate the annual
quantity of sulfur which is emitted for each boiler and plant. For each
plant, allowable emissions are calculated based on NSPS for new boilers
or the applicable SIP in effect June 30, 1976, for the AQCR in which the
plant is located for existing boilers in conjunction with the heating
value and sulfur content of the fuel. Excess emissions expressed as
tons of sulfur which must be removed per year are then estimated as the
219
-------
difference between the calculated and allowable emissions. In the test
for compliance, the plant is considered to be in compliance with the
regulation if actual emissions are less than allowable emissions, or do
not exceed allowable emissions by more than 10%. This allowance factor
is applied to adjust for round-off differences in converting SIP from
the various units of expression to the equivalent single unit of expression
(Ib S02/MBtu) for simplification in testing for compliance.
The compliance procedure tests the level of application of the SIP
to determine the procedure for complying with the regulation. Levels of
application are specified as either (1) an entire plant, (2) an individual
boiler, or (3) an individual stack. In all cases where scrubbers are
required, they are designed for an S02 removal efficiency of 90%. This
results in overcompliance for many plants, particularly those which have
SIP which apply at the boiler level.
Compliance Procedure for Meeting Plant Level SIP—
When the regulation applies to an entire plant, the model determines
the number of boilers which must be scrubbed, ordered from lowest to
highest cost, to reduce overall plant emission to comply with the regula-
tion. The FPC data for these plants and specific boilers are used as
input to the scrubbing cost generator for projecting costs.
Compliance Procedure for Meeting Boiler Level SIP—
When SIP are applied at the boiler level, the compliance test
procedure determines compliance status for individual boilers similar to
the method for determining compliance status at the plant level and
specifies the boilers which exceed allowable emissions. The FPC data
for these plants and specific boilers are then used as input to the
scrubbing cost generator for projecting costs similar to the plant level
SIP compliance procedure.
A hypothetical example is given to illustrate the difference in SC>2
emission reductions when the two procedures are applied to the same
plant. Assume that a plant made up of four equal-size boilers operating
at equal capacity factors has a total annual sulfur emission rate of 120
ktons/year and an allowable emission of 60 ktons/year. Excess emissions
for this plant calculated by difference are equal to 60 ktons/year. The
total sulfur emission rate per boiler is about 30 ktons/year. If scrubbers
capable of removing 90% of the sulfur to the boiler were installed on
each boiler, the net reduction in emissions for each boiler would be
0.90 x 30k or 27 ktons/year. If the S02 emission regulation were a plant
level regulation, the reduction in emissions could be achieved by installing
scrubbers on three of the four boilers. (Excess emissions = 60 ktons/year;
reduction in emissions for three boilers = 3 x 27k or 81 ktons/year,
which is greater than the quantity of excess emissions.) If the same
hypothetical plant had boiler level rather than plant level SIP, the
fourth boiler would not be in compliance, even though the total emissions
for the plant were less than the allowable emissions. Therefore, all
four boilers would require scrubbers if the regulation were on a boiler
basis.
220
-------
Compliance Procedure for Meeting Stack Level SIP—
Power plants are designed with a wide variety of boiler-stack
configurations. Therefore, the application of stack level regulations
has different implications as far as the procedure for complying with
the regulation. If, for example, the plant is designed with multiple
boilers, but with a single stack, the procedure for meeting the regula-
tion is similar to the procedure for complying with plant level regula-
tions. If the plant is designed with separate stacks for each individual
boiler, the procedure for meeting the regulations is similar to the
procedure for complying with boiler level SIP. Most power plants fit
into one of the above two categories. However, there are a number of
plants which have multiple boilers which feed to more than one stack.
In some cases, the FPC data for these plants do not include sufficient
information to determine the specific association between stacks and
boilers. Therefore, it is not possible for these plants to use a
compliance test to determine status of individual stacks. Because of
this problem, and with the concurrence of EPA, all stack level SIP are
used similar to boiler level SIP when the association between boilers
and stacks cannot be determined.
The final output of the scrubbing cost generator is an identifica-
tion of all boilers at each plant which must be scrubbed to meet the S02
emission regulation.
Compliance Status of Power Plants
Based on the projected data, there are 187 plants which will be out
of compliance with either NSPS (new plants) or SIP (existing plants) in
1978. It should be noted that many of the plants shown as out of com-
pliance are likely to be on a compliance schedule with technology that
may be different from that projected. Of these, a total of 69,plants
are out of compliance based on plant level SIP and 118 based on boiler
level SIP. Boiler sizes for plants out of compliance range from as low
as 5 to 1150 MW, whereas plant sizes range from 38 to 2558 MW. Boiler
ages for these plants range from zero (new plants) to 60 years old.
The total annual quantity of emissions from these plants is equivalent
to 5,700 ktons of sulfur per year, compared with an allowable emission
rate of 3,200 ktons/year. Based on these projections, an average overall
S02 removal efficiency of 44% would be required to bring these plants
into compliance.
The method for using the output of the compliance tests to project
costs for meeting the regulation by FGD is discussed in Appendix E.
221
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APPENDIX E
SCRUBBING COST GENERATOR
CONTENTS
Table Page
E-l Indirect Investment and Allowance Factors 227
E-2 Projected 1978 Unit Costs for Labor and Utilities 228
E-3 Annual Capital Charges for Power Industry Financing .... 230
E-4 Sample Output of Scrubbing Cost Generator 232
223
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APPENDIX E
SCRUBBING COST GENERATOR
DEVELOPMENT OF THE SCRUBBING COST GENERATOR
The purpose of the scrubbing cost generator is to provide a simpli-
fied, consistent method for projecting comparative costs for installing
FGD systems on the power plants projected to be out of compliance with
the regulation. Because of the limited amount of information available
for input to the model, the projections are to be treated as general
rather than specific in evaluation of the results.
The FPC data projections to 1978 and the output of the compliance
test models are inputs to the model. The basis for its development and
other relevant information concerning its use are discussed below.
TVA in conjunction with EPA published a report entitled Detailed Cost
Estimates for Advanced Effluent Desulfurization Processes (1) which
projects the economics of S02 control by two throwaway processes (limestone-
and lime-slurry scrubbing) and three recovery processes (MgO slurry-
regeneration, sodium sulfite/bisulfite solution-S02 reduction, and
catalytic oxidation). The detailed "base" investment and operating cost
projections given in the above report for these processes, and the
method illustrated for scaling costs, were coded into a computer model
to allow for projection of economics for these processes at other capac-
ities based on using the 1978 FPC data projections discussed above.
These projections are being used in a separate study of market potential
for sulfur and sulfuric acid. A fourth alternative, limestone scrubbing
with oxidation to gypsum, was coded for this study to evaluate the
potential for producing and using byproduct gypsum in the construction
industry.
The base data incorporated into the program correspond to scrubbing
processes designed for SOO^IW boilers, both new and existing, which burn
3.5% sulfur coal (dry basis). They are assumed to emit 92% of the
sulfur in the coal overhead as S02 and are designed to remove 90% of the
S02« The processes were modified from the initial study to exclude the
costs for particulate removal.
1. McGlamery, G. G., R. L. Torstrick, W. J. Broadfoot, J. P. Simpson,
L. J. Henson, S. V. Tomlinson, and J. F. Young. Detailed Cost Esti-
mates for Advanced Effluent Desulfurization Processes. TVA Y-90;
EPA-600/2-75-006 (NTIS PB 242 541/1WP), January 1975. 418 pp.
224
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Investment Scaling Procedure
Direct Investment Scaling—
A method was established for using the FPC Form 67 data and the
compliance test data to project the investment and unit revenue require-
ments for each power plant out of compliance. Quantities of air and
sulfur rates to the boiler for the base case are included in the data
base.
Similar data are projected for each boiler which is determined from
the compliance test to be out of compliance. Relative capacities are
calculated to allow for scaling costs. Flue gas processing equipment
and costs are estimated assuming that each boiler must be designed with
separate, independent equipment. Absorbent preparation and effluent
processing areas, however, are designed with common facilities at the
plant level to process the combined quantities of absorbent and effluent
from all of the boilers. This "common facility" concept minimizes the
investment requirements because designing for installation of single
large units rather than multiple small units results in an economy of
scale.
The FPC Form 67 data base does not contain data specifying flue gas
rates from the boiler to allow for scaling of the gas-processing equipment
(scrubbers, fans, reheaters, and duct). Therefore, costs for these
areas are scaled on the basis of air rates to the boiler. Sulfur emission
rates for each boiler are available from the compliance tests and are
totaled for each boiler which requires S02 control; the total quantity
is then used in scaling sulfur processsing costs.
s
The general form of the equations for scaling costs for (1) the
flue gas processing areas and (2) the absorbent preparation and effluent
processing areas are shown as follows.
(1) Flue gas processing Base flue gas [~_ . ,_ t u •-, /T\
e • Design air rate to boiler (I)
area cost for = processing area ' e
Bl
CJ. J_ ^__d *_-\_* 1J «_ -*- \J M- t-'J-V^*—^—kJi-'-i-ilC, U.J- ^-t-1. IT-.. • 1 1>t
. ,. . , , , ., ,^^ Design air rate to base boiler
individual boiler (I) cost L
where Bl = scaling exponent for the gas-processing equipment
whose costs are being scaled.
Total flue gas processing area costs for the plant are equal to the sum of
the flue gas processing area costs for each boiler which requires scrubbers.
-------
Total annual sulfur
throughput for all
(2) Absorbent preparation Base absorbent boilerS which require
scrubbers
Total annual sulfur
and effluent processing preparation and
area common facilities effluent processing
cost (entire plant) area cost throughput for the
base plant
where B2 = scaling exponent for the sulfur processing equipment
whose costs are being scaled.
Since the absorbent preparation and effluent processing areas are
designed utilizing common facilities for the total throughput, these
calculated costs do not need to be summed boiler by boiler.
The total direct investment is calculated as the sum of the total
flue gas processing area and the common facilities costs.
Indirect Investment Costs—
Indirect investment costs are estimated as a percentage of the
direct costs similar to the method used in the initial study. For
simplification in developing the model, however, the indirect cost
factors do not vary with plant or boiler size. Table E-l shows the
indirect cost factors which are used in projecting total investment
requirements for each of the four processes as a function of plant
status (new or existing unit).
Investment Adjustment Factors—
The data base was created to allow the input of other factors for
adjusting process investment. A process premise factor is an allowable
input to adjust the projected process investment. The adjustment is
applied uniformly for all plants. It allows the relativity of process
investments to be varied from that reported in the initial study to
reflect updated technology and costs and is applied separate from cost
indices. For the current study, process premise factors for the lime-
stone and gypsum processes are input as 1.2.
The data base also allows for the use of site-specific factors
which can be used for any process and any plant to adjust the investment
to take into account special design provisions which were not considered
in the initial study. Factors were incorporated for some of the TVA
plants to reflect the effect of a common plenum which would require
fewer scrubbers, and to adjust for higher projected capacity factors in
comparison with projected FPC factors.
B2
226
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TABLE E-l. INDIRECT INVESTMENT AND ALLOWANCE FACTORS (1)
Indirect investment and allowance
factors as a percent of direct
capital investment
Limestone and gypsum processes
New Existing
Indirect Investment Factors
Engineering design and supervision
Construction field expense
Contractor fees
Contingency
Total indirects
9
11
5
35
10
13
7
41
Allowance Factors
Startup and modifications
Interest during construction
Total allowances
8
_8
16
8
_8
16
Two additional factors which may be input to the program to impact
process investment include (1) a retrofit difficulty factor (developed
by PEDCo Environmental, Inc.) and (2) a location factor. Each of these
factors is applied specifically to all processes at a given location.
The retrofit difficulty factor adjusts the projected investment equally
for all processes at a given location to account for site-specific
variations in design and layout which would affect costs for installa-
tion of each process alternative equally. Location factors are applied
in the same manner to account for site-specific differences in construc-
tion costs which are related to plant location and terrain.
The FPC data file does not contain information specifying the
number of flue gas ducts on existing boilers. Since the number of
required scrubbing trains is a function of the number of ducts, power
plants with gas flow rates of less than 700 ksft^/minute were arbitrarily
assumed to be designed with two ducts, whereas plants with larger flow
rates were assumed to be designed with four ducts.
1. McGlamery, G. G., R. L. Torstrick, W. J. Broadfoot, T. p. Simpson,
L. J. Benson, S. V. Tomlinson, and J. F. Young. Detailed Cost Esti-
mates for Advanced Effluent Desulfurization Processes. TVA Y-90;
EPA-600/2-75-006 (NTIS PB 242 541/1WP), January 1975. 418 pp.
227
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Revenue Requirement Scaling Procedure
Direct Costs—
Annual quantities of raw materials and utilities required for each
processing area (i.e., absorbent preparation, scrubbing, reheat, byproduct
processing, etc.) are identified and are scaled from the base data
proportional to the relative gas ratio or the relative sulfur throughput
ratio similar to the method for scaling investments. Labor and analyses
requirements are scaled proportional to the relative gas or sulfur through-
put ratio raised to a fractional exponential power.
Utilities, such as humidification water, reheat, and electricity
for the fan, are scaled proportional to the relative gas rate, whereas
raw materials and utilities, such as absorbent and electricity for the
sulfur-processing areas, are scaled proportional to the relative sulfur
rate. Annual costs for raw materials and utilities are then calculated
by applying the unit costs to the annual usage rates.
Projected unit costs for labor and utilities for 1978 are shown in
Table E-2. Maintenance is estimated as 8% of the subtotal direct invest-
ment. Conversion operation costs are defined as the sum of utility,
labor, maintenance, and analyses costs. Direct costs are defined as the
sum of raw material plus conversion costs.
TABLE E-2. PROJECTED 1978 UNIT COSTS FOR LABOR AND UTILITIES
Labor
Operating labor
Analyses
Unit cost, $
10.00/hr
15.00/hr
Utilities
Fuel oil, No. 6 0.35/gal
Natural gas 2.50/kft3
Steam (500 psig) 1.40/klb
Process water 0.06/kgal
Electricity 0.027/kWh
Sludge transportation fee
(offsite disposal variation) 1.00/ton
228
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The delivered cost of limestone is a major input cost item and is
subject to wide variation due to availability and f.o.b. cost of limestone.
A 1972 study by the M. W. Kellogg Company (1) estimated delivered cost
of high-calcium limestone in 1972 to 37 selected power plants, most of
which were located in the eastern half of the United States. Delivered
costs ranged from $1.95 to $13.00/ton. Delivered costs were under
$4.00/ton to half the plants and all but three in the study could have
been supplied at under $6.00/ton. Previous TVA studies had assumed
limestone cost at $4.00/ton to each utility. Because of the variability
in cost found in the Kellogg study, a limestone data base was developed
to use in this and other studies. This data base provides for the
calculation of delivered cost of limestone to each utility from the
nearest limestone quarry. The f.o.b. price used is the state average
price in 1975 plus 10% to reflect 1978 costs. Dolomite sources are
excluded from the data base. According to information developed,
delivered costs of limestone in 1978 will range from $2.07/ton to
$11.23/ton. All but 50 plants in the United States can be supplied at a
delivered cost of less than $6.00/ton in 1978.
The data do not assure that limestone is of the quality required
for use in scrubbing. Further, there is no assurance that sufficient
quantities exist at producing locations to meet long-term utility needs.
The limestone data base was developed from information provided
specifically for use in this study by the Bureau of Mines.
A few existing plants do not have adequate land available for
onsite disposal of throwaway calcium solids from the limestone slurry
process. When this was the case, offsite disposal charges were added.
Land cost was assumed the same. Some cost areas were different between
onsite and offsite disposal but in sum total investment was approximately
equal. Miles to disposal area were added into*the cost model and trans-
portation costs were calculated. Costs were based on a charge of $1.00/ton
for distances up to 3 miles and then charges were assumed to decline
linearly to a minimum of $0.20/ton mile for distances up to 20 miles.
Indirect Costs—
The capital charges included in the indirect operating costs are
applied as average capital charges, including depreciation, interim
replacements, insurance, and cost of capital and taxes. Depreciation is
straight line over the remaining life of the plant (based on an assumed
useful life of 30 years). The capital charge allocation for interim
replacements varies as a function of the remaining life of the plant.
1. O'Donnell, J. J., and A. G. Sliger. Availability of Limestones and
Dolomites. The M. W. Kellogg Company, Report No. RED-72-1265,
February 1, 1972.
229
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For a new plant it is allocated as 0.67% of the total investment, but
declines to zero for plants with less than 20 years of remaining life.
Insurance is allocated as 0.50% of total investment for all plants. The
overall breakdown of capital charges included in the cost projections is
shown in Table E-3 (1).
TABLE E-3. ANNUAL CAPITAL CHARGES FOR POWER INDUSTRY FINANCING (1)
Depreciation, straight line (based on
years remaining life of power unit)
Interim replacements (equipment having
less than 30-year life)
Insurance
Total rate applied to original
investment
As percentage of
original investment
Years remaining life
30 25 20
3.33 4.00 5.00
0.67 0.40 -
0.50 0.50 0.50
4.50 4.90 5.50
Cost of capital (capital structure
assumed to be 50% debt and 50% equity)
Bonds at 8% interest
Equity at 12% return to stockholder
Taxes
Federal (50% of gross return or same
as return on equity)
State (national average for states in
relation to Federal rates)
Total rate applied to depreciation
base
As percentage
of outstanding
depreciation basec
4.00
6.00
6.00
4.80
20.801
a. Original investment yet to be recovered or "written off."
b. Applied on an average basis, the total annual percentage of
original fixed investment for a plant with 30-year remaining
life would be 4.5% + 1.2(20.80%) = 14.90%.
1. McGlamery, G. G., R. L. Torstrick, W. J. Broadfoot, J. P. Simpson,
L. J. Henson, S. V. Tomlinson, and J. F. Young. Detailed Cost Esti-
mates for Advanced Effluent Desulfurization Processes. TVA Y-90;
EPA-600/2-75-006 (NTIS PB 242 541/1WP), January 1975. 418 pp.
230
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For each process, plant overhead is estimated as 20% of conversion
costs and administrative overhead as 10% of operating labor. Adminis-
trative overheads in the initial study (1) were calculated on a different
basis for processes producing a salable byproduct as compared with
sludge-producing processes to take into account the costs for marketing
the byproducts. For this study, however, the byproduct prices are
assumed to be net prices after marketing expenses have been deducted;
therefore, administrative overheads are calculated by the same procedure
for each process.
Subtotal indirect costs are defined as the total of capital charges
and plant and administrative overheads. Total annual revenue require-
ments are defined as the total of direct plus indirect costs.
Output of the Scrubbing Cost Generator
The overall output of the scrubbing cost generator includes the
following information for each of the four scrubbing alternatives
considered.
1. Plant investment
$
$/kW
2. First-year costs excluding byproduct revenue
$
Mills/kWh
C/MBtu
3. Byproduct
Production rate, tons/yr
Equivalent cost, $/ton
4. Incremental process cost in comparison to limestone scrubbing
$
$/ton of byproduct
An example output table for an unidentified plant is shown in Table E-4.
The data generated in the scrubbing cost model are used to calculate
the scrubbing costs of a throwaway system versus a salable byproduct for
each of the 833 boilers identified in this study as operating out of
compliance with pollution control laws in 1978.
1. McGlamery, G. G., R. L. Torstrick, W. J. Broadfoot, J. P. Simpson,
L. J. Henson, S. V. Tomlinson, and J. F. Young. Detailed Cost Esti-
mates for Advanced Effluent Desulfurization Processes. TVA Y-90;
EPA-600/2-75-006 (NTIS PB 242 541/1WP), January 1975. 418 pp.
231
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TABLE E-4. SAMPLE OUTPUT OF SCRUBBING COST GENERATOR
Compliance costs from 1978 projections
Plant code and name
Capacity factor coal .565 oil .025
Sulfur content coal .0320 oil .0150
Total capacity 1275.MW Total boilers 12
scrubbed 1109.MW 5
gas 0.000
Process
Investments
$
$/kW
First-year costs
Byproduct revenues
excluded
$
Mills/kWh
0/MBtu
Byproduct
Tons/year
Cost, $/ton
Incremental costs
in comparison with
limestone process
$
$/ton
Limestone
80152545.
72.3
45078254.
6.82
65.7
Sludge
426094.
105.8
0.
0.
Gypsum
78456732.
70.8
50466002.
7.64
73.5
CaS04.2H20
500602.
100.8
5387749.
11.
The alternative fuel costs for fossil fuel power generation are
expressed on a common basis (c/MBtu) for convenience in comparing fuel
alternatives.
Clean Fuel Alternative
The "clean fuel" premium alternative is added to provide an option
for plants with extremely high projected scrubbing costs. Actual deter-
mination of costs to modify plants, purchase, and use clean fuel is not
within the scope of the study. Clean fuel premium costs, like scrubbing
costs, will vary from plant to plant. For purposes of this study it has
been assumed that any plant can purchase and use clean fuel for a premium
cost of $0.70/MBtu heat input. For simplicity the clean fuel alternative
is assumed constant at all plants.
232
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The clean fuel premium alternative is used in this study as a
screening mechanism, but the concept does have usefulness as an indi-
cator of demand for clean fuel. Costs are calculated for each plant out
of compliance and are expressed in C/MBtu heat input. On a national
scale plants which have highest scrubbing costs (those with greatest in-
centive to use limited quantities of clean fuel) can be identified.
233
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TECHNICAL REPORT DATA
(Please read Inunctions on the reverse before completing)
. REPORT NO.
EPA-600/7-78-192
2.
3, RECIPIENT'S ACCESSION NO.
4. TITLE ANDSUBTITLE
Feasibility of Producing and Marketing Byproduct
Gypsum from SO2 Emission Control at Fossil-Fuel-
Fired Power Plants
5. REPORT DATE
October 1978
6. PERFORMING ORGANIZATION CODE
. AUTHORIS)
J.M. Ransom, R. L.Torstrick, and S.V.Tom lins on
8. PERFORMING ORGANIZATION REPORT NO.
. PERFORMING ORGANIZATION NAME AND ADDRESS
Tennessee Valley Authority
National Fertilizer Development Center
Muscle Shoals, Alabama 35660
10. PROGRAM ELEMENT NO.
INE624A
11. CONTRACT/GRANT NO.
EPA Interagency Agreement
D8-E721-BJ
2. 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; 3/76 - 3/78
14. SPONSORING AGENCY CODE
EPA/600/13
5. SUPPLEMENTARY NOTES jjERL-RTP project officer is Julian W. Jones, Mail Drop 61, 919/
541-2489.
e. ABSTRACT
report gives results of a study to identify fossil-fuel-fired power plants
that might, in competition with existing crude gypsum sources and other power plants ,
.ower the cost of compliance with SO2 regulations by producing and marketing abate-
ment gypsum. In the Eastern U.S. , gypsum production has a limited but important
jotential to lower the cost of compliance by power plants. Gypsum consumption was
Drojected as 2 million tons in wallboard use and 3 million tons in cement, and total
:978 sales were estimated at S124.4 million in the Eastern U.S. Potential gypsum pro-
duction by 113 Eastern U.S. steam plants requiring flue gas desulfurization for compli-
ance amounts to 27 million tons. For about 90% of the potential abatement gypsum pro-
duction, the cost difference between producing gypsum and conventional sulfite sludge
by limestone scrubbing is greater than the estimated cost of mining natural gypsum.
However, 30 power plants (generally <200 MW) with small annual outputs were identi-
fied that could reduce compliance cost by producing and marketing abatement gypsum.
The 30 plants would replace 2.23 million tons of crude gypsum at 93 demand points
(92 cement plants and 1 wallboard plant). Of the gypsum replaced, 74% is imported.
First-year saving to steam plants is Sll million, and about $2 million is saved by the
gypsum industry.
KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
Pollution Fossil Fuels
Gypsum Desulfurization
Byproducts Flue Gases
Marketing Wallboard
Electric Power Plants
Sulfur Dioxide Cements
b.lDENTIFIERS/OPEN ENDGD TERMS C. COSATI Field/Group
Pollution Control
Stationary Sources
Flue Gas Desulfurization
13B
08G
14B
05C
10B
07B
2 ID
07A
2 IB
11L
11B
13. DISTRIBUTION STATEMENT
Unlimited
19. SECURITY CLASS (This Report)
Unclassified
21. NO. OF- PAGES
234
20. SECURITY CLASS (This page I
Unclassified
22. PRICE
EPA Form 2220-1 (9-73)
234
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