United States
Environmental Protection
Agency
Office of Air Quality
Planning and Standards
Research Triangle Park NC 27711
EPA-450 5-80-001
Jum> 1979
Air
The Economic Impact
of Vapor Control
Regulations on the
Bulk Storage  Industry

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                           EPA-450/5-80-001
The Economic  Impact
    of Vapor  Control
  Regulations on the
Bulk Storage Industry
               by

          Richard J. McCarthy

          Arthur D. Little, Inc.
           37 Acorn Park
      Cambridge, Massachusetts 02140
      l I'A 1'inji" i othi "i iiiomdbl lull-
            Prepared for

   U.S. ENVIRONMENTAL PROTECTION AGENCY
      Office of Air, Noise, and Radiation
   Office of Air Quality Planning and Standards
   Research Triangle Park, North Carolina 27711
            June 1979

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This report is issued by the Environmental Protection Agency to report
technical data of interest to a limited number of readers.  Copies are
available free of charge to Federal employees,  current contractors and
grantees,  and nonprofit organizations - in limited quantities - from the
Library Services Office (MD-33) ,  U.S. Environmental Protection Agency,
Research Triangle Park, North Carolina 27711; or for a nominal fee,
from the National Technical Information Service,  5285 Port Royal Road,
Springfield, Virginia 22161.
This report was furnished to the Environmental Protection Agency by
Arthur D. Little, Inc., 37 Acorn Park, Cambridge, Massachusetts 02140.
The contents of this report are reproduced herein as received from
Arthur D. Little, Inc.  The opinions, findings,  and conclusions expressed
are those of the author and not necessarily those of the Environmental
Protection Agency.  Mention of company or product names is not to be
considered as  an endorsement by the Environmental Protection Agency.
                  Publication No. EPA-450/5-80-001
                                 11

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                               TABLE OF CONTENTS

                                                                        PAGE

 LIST OF TABLES	    iii

 LIST OF FIGURES	    vii

 I.   EXECUTIVE SUMMARY	    I.I

          A.   Introduction	;	    I.I
          B.   Market Audit	;	    1.2
          C.   Control Strategies	    1.10
          D.   Closure Analysis	,	    1.16
          E.   Employment and Cost Impacts	    1.23

 II.  MARKET AUDIT OF BULK TERMINALS	  II.1

          A.   Introduction	  II.1
          B.   Audit Summary	  II.5
          C.   Bulk Terminal  Trends	  11.15

III.  MARKET AUDIT OF BULK PLANTS	  III.l

          A.   Introduction	  III.l
          B.   Audit Summary	  III.3
          C.   Bulk Plant Trends	  III.10

 IV.  VAPOR CONTROL STRATEGIES AND SYSTEM COSTS	  IV.1

          A.   Introduction	  IV. 1
          B.   Vapor Control  Options	  IV.1
          C.   Vapor Control  System Costs	  IV.13

 V.   BULK STORAGE MODELS	    V.I

          A.   Introduction	    V.I
          B.   Bulk Storage Models	    V.2
          C.   Cost Pass Through Assumptions	    V.8

VI.   BULK TERMINAL IMPACTS	  VI. 1

          A.   Introduction	  VI.1
          B.   Bulk Terminal  Population Subject to Vapor Control	  VI.1
          C.   Closure Analysis	  VI.3
          D.   Terminal Impacts	  VI. 19
          E.   Tank Trailer Costs	  VI.22

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                              TABLE OF CONTENTS
                                 (continued)
                                                                       PAGE
VII. BULK PLANT IMPACTS	   VII.1
         A.  Introduction	   VII.1
         B.  Bulk Plant Population Subject to Vapor Control	   VII.I
         C.  Closure Analysis	   VII.4
         D.  Bulk Plant Impacts	   VII.20

APPENDIX A	     A.I
APPENDIX B	     B.I
APPENDIX C	     C.I-
APPENDIX D	     D.I
APPENDIX E	,	     E.I
APPENDIX F	     F.I
APPENDIX G	     G.I

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                            LIST OF TABLES
TABLE NO.                                                          PAGE
  I.I        1978 BULK TERMINAL POPULATION	       1.4
  1.2        GASOLINE TERMINAL DISTRIBUTION BY SIZE AND
                  OWNERSHIP	       1.5
  1.3        1978 BULK PLANT POPULATION 	       1.8
  1.4        GASOLINE BULK PLANT DISTRIBUTION BY SIZE AND
                  OWNERSHIP	       1.9
  1.5        VAPOR CONTROL OPTIONS AT GASOLINE BULK STORAGE
                  FACILITIES	       1.14
  1.6        COMPETITIVE PASS THROUGH ASSUMPTIONS	       1.18
  1.7        BULK PLANT CLOSURES BECAUSE OF INACCESSIBILITY
                  OF CAPITAL	       1.20
  1.8        BULK PLANT CLOSURES BECAUSE OF INSUFFICIENT
                  PROFITABILITY	       1.22
  1.9        CLOSURE IMPACT OF THE PROPOSED VAPOR CONTROL
                  OPTIONS	'.	       1.24
  1.10       EMPLOYMENT IMPACT OF THE PROPOSED VAPOR CONTROL
                  OPTIONS	       1.25
  1.11       TOTAL COST OF THE PROPOSED VAPOR CONTROL OPTIONS..       1.26
 II.1        1978 BULK TERMINAL POPULATION	      II.7
 11.2        1978 REGIONAL PRODUCT SUPPLY/DEMAND BALANCE	      11.9
 11.3        1978 REGIONAL GASOLINE SUPPLY/DEMAND BALANCE	      11.10
 II.4        BULK TERMINAL STORAGE DISTRIBUTION	      11.12
 II.5        BULK TERMINAL THROUGHPUT DISTRIBUTION	      11.13
 II.6        1978 BULK TERMINAL OWNERSHIP	      11.14
 II.7        GASOLINE TERMINAL DISTRIBUTION BY SIZE AND
                  OWNERSHIP	      11.16
 II.8        1978 BULK TERMINAL EMPLOYMENT	      11.17
 11.9        A COMPARISON OF RECENT FORECASTS OF U.S. GASOLINE
                  CONSUMPTION	      11.18
III.l        1978 BULK PLANT POPULATION....	     III.5
III.2        NON-GASOLINE BULK PLANT DISTRIBUTION BY REGION
                  AND OWNERSHIP	     III.6
III.3        BULK PLANT STORAGE DISTRIBUTION	     III.8
III.4        BULK PLANT THROUGHPUT DISTRIBUTION	     III.9
                                  m

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                            LIST OF TABLES
                              (continued)

TABLE NO.                                                            PAGE

III.5        1978 BULK PLANT OWNERSHIP	       III.11

III.6        GASOLINE BULK PLANT DISTRIBUTION  BY SIZE AND
                  OWNERSHIP	       III.12

II1.7        1978 BULK PLANT EMPLOYMENT	       II1.13

III.8        MARKET RATIONALIZATION OF GASOLINE BULK PLANTS,
                  1978-1983	       III.16
 IV.1        BASE CASE EMISSIONS AT BULK STORAGE FACILITIES...        IV.5

 IV.2        NATIONAL BENZENE EMISSIONS UNDER  VAPOR CONTROL
                  OPTIONS	        IV. 9

 IV.3        VAPOR CONTROL OPTIONS AT GASOLINE BULK STORAGE
                  FACILITIES	        IV. 12
 IV.4        ESTIMATED 1978 CONTROL COSTS FOR  PRIMARY VAPOR
                  CONTROL SYSTEMS AT MODEL  TERMINALS	        IV. 14

 IV.5        ESTIMATED 1978 CONTROL COSTS FOR  STAND-BY VAPOR
                  CONTROL SYSTEM AT MODEL TERMINALS	        IV.16

 IV.6        ESTIMATED 1978 COST OF VAPOR CONTROL IN GASOLINE
                  TANK TRAILERS.......	        IV.18

 IV.7        ESTIMATED 1978 COSTS TO INSTALL A VAPOR BALANCE
                  SYSTEM AT BULK PLANTS FOR INCOMING TRUCK
                  TRANSPORTS	        IV .20

 IV.8        ESTIMATED 1978 COSTS TO INSTALL A VAPOR BALANCE
                  SYSTEM AT BULK PLANTS FOR INCOMING AND
                  OUTGOING TRUCKS	        IV.21

 IV.9        ESTIMATED 1978 COSTS TO INSTALL A SINGLE PRIMARY
                  VAPOR REFRIGERATION SYSTEM AT BULK PLANTS...        IV.22

 IV.10       ESTIMATED 1978 COSTS TO INSTALL A PRIMARY VAPOR
                  INCINERATION SYSTEM AT BULK  PLANTS	        IV .23

 IV.11       ESTIMATED 1978 COSTS TO INSTALL A PRIMARY
                  REFRIGERATION AND A STAND-BY INCINERATION
                  SYSTEM AT BULK PLANTS	        IV .24

 IV.12       ESTIMATED 1978 COSTS TO INSTALL A PRIMARY
                  INCINERATION AND A STAND-BY  INCINERATION
                  SYSTEM AT BULK PLANTS	        IV.25

  V.I        LARGE MARINE TERMINAL PROTOTYPE...........	         V.3
  V.2        ESTIMATED INVESTMENT PROFILE OF LARGE MARINE
                  TERMINAL PROTOTYPE.	         V .4
                                    IV

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                            LIST OF TABLES
                              (continued)

TABLE NO.                                                          PAGE

  V.3        ESTIMATED 1978 NET INVESTMENT  OF  BULK  STORAGE
                  PROTOTYPES	      V .5

  V.4        ESTIMATED 1978 OPERATING EXPENSES OF LARGE
                  MARINE TERMINAL PROTOTYPE	      V.6

  V.5        ESTIMATED 1978 OPERATING EXPENSE  OF BULK STORAGE
                  PROTOTYPES	      V .7
  V.6        REQUIRED 1978 TARIFF (PRE-VAPOR CONTROL) OF
                  LARGE MARINE TERMINAL PROTOTYPE	      V.9

  V.7        REQUIRED TARIFF OF BULK STORAGE PROTOTYPES  TO
                  COVER ESTIMATED 1978 COSTS	      V.10

  V.8        EXAMPLE OF COMPETITIVE ECONOMICS  OF TWO BULK
                  STORAGE FACILITIES	      V.ll
 VI.1        PETROLEUM BULK TERMINALS HAVING NO GASOLINE
                  THROUGHPUT	      VI. 2

 VI.2        PETROLEUM BULK TERMINALS SUBJECT  TO THE
                  PROPOSED VAPOR CONTROL OPTIONS	      VI .4

 VI.3        DISTRIBUTION OF GASOLINE TERMINALS SUBJECT  TO
                  THE PROPOSED VAPOR CONTROL OPTIONS	      VI .6

 VI.4        ESTIMATED 1978 VAPOR CONTROL CAPITAL REQUIREMENTS
                  OF BULK TERMINALS	      VI .8

 VI. 5        BORROWING CRITERIA USED IN ANALYSIS	      VI .10

 VI.6        TERM DEBT AS A PERCENT OF AFTER-TAX CASH FLOW  AT
                  BULK TERMINALS	      VI.13
 VI.7        CHANGE IN DAILY GASOLINE BREAKEVEN THROUGHPUT  AT
                  BULK TERMINALS BECAUSE OF VAPOR CONTROL
                  COSTS	      VI .1 6
 VI.8        BULK TERMINALS ROI AND GASOLINE TARIFF IMPACTS	      VI.18

 VI.9        BULK TERMINAL CLOSURES BECAUSE OF VAPOR CONTROL
                  ECONOMICS	      VI .20

 VI.10       VAPOR CONTROL EMPLOYMENT AND COST IMPACTS AT
                  BULK TERMINALS	      VI .21

 VI.11       COST OF VAPOR CONTROL AT BULK TERMINALS	      VI.23

 VI.12       CAPITAL COST OF THE PROPOSED VAPOR CONTROL  OPTIONS
                  AS A PERCENT OF THE PETROLEUM INDUSTRY'S
                  1977 ENVIRONMENTAL EXPENDITURES	      VI.24

 VI.13       ESTIMATED 1978 GASOLINE TRAILER POPULATION	      VI.26

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                             LIST OF TABLES
                               (continued)

TABLE NO.                                                            PAGE
 VI.14       TOTAL COST OF INSTALLING VAPOR CONTROL  EQUIPMENT
                  ON THE GASOLINE TANK TRAILER FLEET	       VI.27

VII.I         PETROLEUM BULK PLANTS SUBJECT TO THE PROPOSED
                  VAPOR CONTROL OPTIONS	      VI1.2

VII.2        DISTRIBUTION OF GASOLINE BULK PLANTS SUBJECT
                  TO THE PROPOSED VAPOR CONTROL OPTIONS	      VII .5

VII.3        ESTIMATED 1978 VAPOR CONTROL CAPITAL REQUIREMENT
                  OF BULK PLANTS	      VI1.7
VII.4        TERM DEBT AS A PERCENT OF AFTER-TAX CASH FLOW
                  AT BULK PLANTS	      VI1.9

VI1.5        BULK PLANT CLOSURES BECAUSE OF INACCESSIBILITY
                  OF CAPITAL	      VII.11

VII.6        CHANGE IN DAILY GASOLINE BREAKEVEN THROUGHPUT
                  AT BULK PLANTS BECAUSE OF VAPOR CONTROL
                  COSTS	      VII. 13

VI1.7        BULK PLANT ROI AND GASOLINE TARIFF IMPACTS...	      VI1.14

VII.8        BULK PLANT CLOSURES BECAUSE OF INSUFFICIENT
                  PROFITABILITY	      VII.16

VII.9        BULK PLANT CLOSURES BECAUSE OF VAPOR CONTROL
                  ECONOMICS RESULTING FROM THE NOJC  COST
                  SCENARIO	      VII .17

VII.10       BULK PLANT CLOSURES BECAUSE OF VAPOR CONTROL
                  ECONOMICS RESULTING FROM THE HOUSTON-
                  GALVESTON COST SCENARIO	      VII.18

VI1.11       BULK PLANT CLOSURES BECAUSE OF VAPOR CONTROL
                  ECONOMICS RESULTING FROM THE COLORADO
                  APCD COST SCENARIO	      VI1.19

VII.12       EMPLOYMENT IMPACT AT BULK PLANTS BECAUSE OF  '
                  VAPOR CONTROL ECONOMICS.	      VI1.21
VI1.13       TOTAL COST OF VAPOR CONTROL AT BULK PLANTS	      VI1.22

VII.14       COST OF VAPOR CONTROL AT BULK PLANTS RESULTING
                  FROM THE NOJC COST SCENARIO	      VI1.23

VI1.15       COST OF VAPOR CONTROL AT BULK PLANTS RESULTING
                  FROM THE HOUSTON-GALVESTON COST SCENARIO	      VI1.24

VII.16       COST OF VAPOR CONTROL AT BULK PLANTS RESULTING
                  FROM THE COLORADO APCD COST SCENARIO	      VII.25
                                    VI

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                            LIST OF FIGURES
FIGURE NO.                                                           PAGE

  I.I         ESTIMATED 1983 BULK TERMINAL POPULATION BEFORE
                  VAPOR CONTROL IMPACTS	       1.7

  1.2        ESTIMATED 1983 BULK PLANT POPULATION BEFORE VAPOR
                  CONTROL IMPACTS	       1.11

 II. I        GASOLINE DISTRIBUTION NETWORK	      II.2

 II.2        GASOLINE TRANSPORTATION COSTS GULF COAST TO NEW
                  YORK SPOT TANKER RATES VS.  COLONIAL PIPELINE.      II.3

 II.3        PETROLEUM ADMINISTRATION FOR DEFENSE DISTRICTS....      II.8
 II.4        ESTIMATED 1983 BULK TERMINAL POPULATION BEFORE
                  VAPOR CONTROL IMPACTS	      11.20
III.l        GASOLINE DISTRIBUTION NETWORK	     III.2

III.2        ESTIMATED 1983 BULK PLANT POPULATION BEFORE VAPOR
                  CONTROL IMPACTS	,	     III.15

 IV.1        GASOLINE DISTRIBUTION NETWORK	      IV.2

 IV.2        GASOLINE TANK TRUCK LOADING METHODS	      IV.3
 IV.3        VAPOR BALANCED TO TRUCK TRANSPORT DURING STORAGE
                  TANK LOADING	      IV.8

 IV.4        VAPOR BALANCE SYSTEMS AT BULK STORAGE PLANTS	      IV.10

 VI.1        DISTRIBUTION OF BULK TERMINALS SUBJECT TO
                  VAPOR CONTROL	      VI.5

 VI.2        AFTER-TAX CASH FLOW AS A DETERMINANT FOR SECURING
                  A COMMERCIAL LOAN FOR VAPOR CONTROL EQUIPMENT      VI.12

 VI.3        BREAKEVEN ANALYSIS OF THE MARINE TERMINAL
                  POPULATION	      VI. 17

VII.I        DISTRIBUTION OF BULK PLANTS SUBJECT TO
                  VAPOR CONTROL	     VII.3
                                   VII

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                        I. EXECUTIVE SUMMARY

A.   INTRODUCTION
     The U.S. Environmental Protection Agency (EPA) is considering
regulations which would control total benzene emissions on a national
basis.  A significant portion of these benzene emissions is contained
in the gasoline vapors released during the normal gasoline transfer
operations of petroleum bulk terminals and bulk plants.  Possible
strategies for controlling benzene in the bulk storage industry in-
clude  the on-site collection and disposal of gasoline vapors and the
collection and transportation of these vapors to a common or central
point within the gasoline marketing network for ultimate disposal.
This study represents only one approach to the benzene problem.

     The EPA has requested Arthur D. Little, Inc. (ADL) to assess the
economic impacts of several vapor control' strategies which would
reduce the benzene emissions of the bulk  storage industry.  Specifically,
Arthur D. Little has been asked to:

          •  Identify and characterize the bulk storage industry
          •  Determine the number of facility closures expected
             to occur because of the proposed vapor control
             regulations
          t  Estimate the employment levels displaced by these
             closures, and
          t  Calculate the national cost  of installing and
             operating vapor control systems in the remaining
             bulk storage population.

      In this chapter, we will present an  overview of the methodological
approach used in performing this analysis and a summary of our results.
                                  1.1 •

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B.   MARKET AUDIT
     Because no comprehensive data base exists on the bulk storage
industry, a detailed market audit of all bulk terminals and bulk
plants was conducted.  The purpose of this task was to profile the
physical (e.g. number, size and location) and operational  (e.g.  product
mix, gasoline throughput and employment) characteristics of the industry.
Additionally, the competitive environment within which these facilities
operate and all significant industry trends were identified.  Arthur
D. Little compiled the data necessary to conduct this audit from
government, industry and trade association reports, industry and trade
association interviews, and in-house sources.  The principal findings
of the market audit follow.

1.   Historical  Market Environment
     The conditions which induced the petroleum companies to over-
build their marketing networks in the 1950's and early 1960's
disappeared by the end of the 1960's.  The integrated oil companies
began to view their marketing and/or refining operations as separate
profit centers to be judged on "stand alone" economics.  Marketing
activities, including bulk storage operations, could no longer be
subsidized by upstream profits and were now expected to recover all
operating expenses as well as to provide an acceptable return on
capital.  "Stand alone" economics caused gasoline marketers, both
majors and independents, to review their marketing strengths and to
re-evaluate their overall corporate marketing strategies.  Many of
the integrated petroleum companies shifted their marketing philosophy
from volume maximization to profit maximization.  Investment in new
marketing facilities declined and older, marginal terminals, bulk
plants and service stations were sold, consolidated or closed as
market conditions rendered them uneconomic.  Through this "market
rationalization" process, some companies scaled down their marketing
activities or withdrew entirely from selected areas where they had
over-extended their supply or marketing capabilities.  The trend of
                                  1.2

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"market rationalization," which was well  underway by the early 1970's,
was accelerated by the market conditions  resulting from the OAPEC

Embargo of 1973-1974.

2.   Bulk Terminals
     In 1978, there were an estimated 1,751 petroleum bulk terminals

in the U.S. (Table I.I).  This figure represents a decline of 9% from
                                                                     2
the 1,925 terminals identified by the Department of Commerce in 1972.

Approximately 55% of these facilities are marine terminals receiving
petroleum product by tanker or barge, while the remaining 45% are

pipeline terminals.  Of  the 1978 bulk terminal population, an estimated
1,511 terminals or 86% store  gasoline.  While the total number of bulk
terminals declined between 1972 and 1978, total product storage increased

approximately 30% from 593 million barrels to 771 million barrels.
Total gasoline storage capacity in 1978 was estimated to be 296 million

barrels or 38% of total  product storage.

     Almost three-quarters, or 72%, of the  gasoline bulk terminals in
                                                            •3
the  U.S. are owned by the major and semi-major oil companies   (Table
 1.2).   Independents,  including regional refiners, marketers/wholesalers,
        4                             5
jobbers  and bulk liquid warehousers,  own the remaining 28%.   Majors

 own  a  proportionately greater number of the larger  terminals  than do
 the  independents.  While majors on average own approximately  72% of
 the  gasoline terminals,  they  own over 84% of the terminals having a total
  This figure does  not include  crude  or LPG terminals  which  were  excluded
 ?from consideration in this  study.
 ^Bureau of Census, 1972 Census of Wholesale Trade.
  The largest 22 gasoline marketers based on total  assets, hereafter
  referred to as simply majors. For a listing of the individual companies
 .comprising these  two groups,  see Appendix B.
  A jobber is a petroleum distributor who purchases refined  product from
  a refiner or terminal operator for  the purpose of reselling  to  retail
  outlets, commercial  and agricultural accounts, or through  his own
 cretail outlets.
  Bulk liquid warehousers only  store  petroleum products  at their  terminals
  for a fee and do  not market the product themselves.
                                   1.3

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TABLE I.I
1978 BULK TERMINAL POPULATION
PADD
I '
II
5
I'll
IV
V
Total
Source:

« i i r»i-T*r»/M r-i i»j -rrn
HIT MAI f-
	 : 	 MLL rt i KUUC.UIYI i tro'imMLo
Number Percent
of of Total Storage
Terminals Total Capacity
745
429
276
39
262
1,751
Bureau
Petrol e
Liquid
Thousand
Barrels
43% 403,633
24% 158,219
16% 126,223
2% 7,238
15% 75,403
100% 770,716
of Census, 1972 Census
urn News, Factbook (197
Terminals and Storage

Percent
of
Total

Number
of
Terminals
- TFRMINAI S
Percent
of
Total
Thousand
Cu. Meters
64,172
25,155
20,068
• 1,151
11,988
, 52% '
21%
16%
1%
10%
122,534 100%
of Wholesale Trade;
2-1978); Independent
Facilities; Industry
657
343
234
39
238
1,511
U.S. Army Corps
Liquid Terminals
contacts; Arthur
43%
23%
15%
3%
16%
100%
of Engineers
Association
D. Little,
STORING GASOLINE 	
Gasoline Storage
Capacity
Thousand Thousand
Barrels Cu. Meters
149,792 23,815
62,115 9,875
51,753 8,228
4,240 674
28,408 4,517
296,308 47,109
, Port Series; National
, 1978 Directory - Bulk
Inc.

Percent
of
Total
51%
21%
17%
1%
10%
100%

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                                             TABLE  1.2


Total Storage
Capacity
Thousand Thousand
Barrels Cu. Meters
< 200 < 30
200-600 30-95
600-1,000 95-160
> 1,000 >160
GASOLINE TERMINAL DISTRIBUTION
BY SIZE AND OWNERSHIP
PERCENT OF TERMINALS STORING GASOLINE
Majors and Percent Total Number of
Semi-Majors Independents of Total Terminals Storing Gasol ine
30% 21% 50% - 764
25% -3% 28% 423
10% ' 3% 13% 192
7% 2% 9% 132
Percent Total
72%
28%
100%
Total Number of
 Gasoline Terminals      1,086
                   425
                                    1,511
Source:  Bureau of Census,  1972 Census  of Wholesale  Trade;  U.S. Army  Corps of  Engineers, Port Series;
        National  Petroleum News,  Factbook (1972-1978);  Independent Liquid Terminals Association, 1978
        Directory - Bulk Liquid Terminals and  Storage  Facilities; Industry contacts; Arthur D. Little, Inc.

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storage capacity greater than 200,000  barrels,  but only  59%  of  the
gasoline terminals having less than 200,000  barrels of total  storage.
A shift in ownership from majors  to independents  is expected to
continue, particularly regarding  the smaller terminals,  as some majors
either reduce their marketing activities  or  withdraw entirely from
selected regions as part of a market rationalization process.

     "Stand alone"economics and the market rationalization of petroleum
companies are expected to continue exerting  closure pressure on margin-
ally profitable facilities.  Although  most closures and  consolidations
in the bulk terminal industry have already occurred, approximately  20
small marine terminals, or 3% of  the terminals  having an average daily
gasoline throughput less than 200,000  gallons,  are expected  to  close
or to consolidate their operations between 1978 and 1983 (Figure I.I).

3.   Bulk Plants
     In 1978, there were approximately 18,640 petroleum bulk plants in
the U.S. (Table 1.3).  This figure represents a decline of 20%  from
the 23,370 bulk plants reported by the Department of Commerce in 1972.
Of the total 1978 bulk plant population,  96% or 17,850 bulk  plants
store gasoline.  Total product storage  capacity at bulk plants in
1978 was estimated at 1.8 billion gallons of which 1.1 billion  gallons,
or 60%, was gasoline capacity.

     Jobbers own the greatest number of gasoline bulk plants with 76%
of the estimated 1978 population  (Table 1.4).  Majors own approximately
20%, while the independent marketer/wholesalers own less than 5%.  The
jobbers' share of the market has  been increasing steadily in recent
years as the majors have pulled out of secondary storaae operations
as part of their overall marketing strategy.  Jobbers tend to own a
proportionately greater number of small gasoline bulk plants, and pro-
portionately fewer large bulk plants than either the majors  or the
independent marketer/wholesalers.  Jobbers,  who own 76% of all  gasoline
bulk plants, own over 82% of the smallest bulk plants having less than
                                  1.6

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2500
2000
1.925
                             1,750
                                 1,730
1500
1000
 500
             1972
                1978
1983
             FIGURE 1.1   ESTIMATED 1983 BULK TERMINAL
                        POPULATION BEFORE VAPOR
                        CONTROL IMPACTS
                             1.7

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        TABLE 1.3
1978 BULK PLANT POPULATION






Number of
PADD Bulk


I 3
II 8
»— 1
co r
III 3
IV
• •*•
V 1
Total 18
Plants


,510
,850

,320
990
,970
,640
ALL PETROLEUM BULK
Percent
of
Total


19%
47%

18%
5%
11%
100% 1

Total
' PI ANTC
< 1 LMM 1 O

Storage
Capacity
Thousand
Gallons
433,290
710,670

253,380
85,490
302,270
',785,100
Source: Bureau of Census, 1972 Census
Factbook, (
Thousand
Cu. Meters
1,641 ,
2,691

958
323
1,144
6,757
of Wholesal
1972-1978); Industry contacts;


Percent
of
Total



Number
- BULK PLANTS
Percent
of of
STORING G;


icni TMC
\-5ULllNt 	

Gasol ine Storage
Bulk Plants Total
Capacity
Thousand

24%
40%

14%
5%
17%
100%
e Trade;
Arthur D

3,190
8,540

3,320
990
1,810
17,850

18%
48%

19%
5%
10%
100% 1
National Oil Jobbers Council
. Little, Inc.

Gal
250
401

187
58
164
,062
Ions
,270
,830

,190
,490
,600
,380
; National


Thousand
Cu. Meters
947
1,521

709
221
623
4,021
Petroleum



Percer
of
Tota"


24%
38%

18%
5%
15%
100%
News ,


-------
                                   TABLE  1.4
GASOLINE BULK
Total Storage
Capacity
Thousand Cubic
Gallons Meters
<40 <150
40-150 150-570
150-300 570-1,140
>300 > 1,140
Percent of Total
Total Number of
Bulk Plants Storing
Gasoline
Source: Bureau of Census
	 PERCEf
Majors
& Semi-
Majors
2.0
16.2
1.2
0.8
20.2
3,610
, 1972 Cens
PLANT DISTRIBUTION BY SIZE AND OWNERSHIP
IT nc Dill V Dl AMTC CTADTMP PACfM TMF

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40,000 gallons of storage capacity,  but only 36% of the  largest  bulk
plants having storage greater than 300,000  gallons.   By  contrast,  the
majors, who own 20% of the gasoline bulk plants, own over 75%  of the
largest facilities, but only 18% of the smallest bulk plants.

     Additional bulk plant closures  are expected because of increasing
market competition and the ongoing rationalization process of  petroleum
marketers which will continue to favor larger, more efficient  bulk
plant operations.  Many bulk plants  can no  longer operate profitably
because of shrinking margins caused by increasing operating costs.
Based upon industry discussions with majors,independents and jobbers,
an estimated 3,480 gasoline bulk plants are expected to  close  or be
consolidated over the next 5 years, thereby reducing the bulk  plant popu-
lation to about 15,100 (Figure 1.2);  A large portion of this  decline
results from a more accelerated exodus from the bulk plant industry
on the part of the majors and independents.  As much as  42% of the
majors' 1978 bulk plant population will be  either sold or closed over
the next 5 years.  Most of these facilities are expected to be purchased
by jobbers who will consolidate them with their existing operations.
The jobbers' share of the balk plant population is expected to increase
from 76% to 81% by 1983.  The ongoing shift of bulk plant ownership
will continue to be a major consideration within the industry.  All
3,480 closures are expected to be bulk plants having less then 8,000
gallons of average daily gasoline throughput.

C.   CONTROL STRATEGIES
     The EPA is considering three control options which  would  reduce
the nationwide emission of benzene during normal bulk storage  opera-
tions.  These options address the following three major sources of
gasoline vapor in the industry:

     •  The loading of truck transports at bulk terminals
        (dispatch of product)
     •  The filling of gasoline storage tanks at bulk plants
        (receipt of product)
                                  1.10

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25,000
20,000
15,000
10,000
 5,000
               23,300
                                18,640
                                                 15,100
               1972
1978
1983
                    FIGURE 1.2  ESTIMATED 1983 BULK PLANT
                                POPULATION BEFORE VAPOR
                                CONTROL IMPACTS
                                1.11

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     •  The loading of tank wagons at bulk plants
        (dispatch of product)

These sources of qasoline vapor are controlled to varying degrees  by
the three proposed options outlined below.

1.   Option 1
     Option 1 provides the least amount of benzene reduction  of the
three control options.  Under this option, all terminals  must install
control systems to collect and dispose of gasoline vapors resulting
from truck transport loading.  All truck transports loading at the
terminal would also have to install equipment to receive  gasoline
vapors from customers' storage tanks and direct this vapor to the
terminal's vapor control system.  These systems may either reliquify
the gasoline vapors, returning the liquid to the storage  tanks, or
oxidize the collected vapors.  Bulk plants would be required to use
either a top-loading or bottom-loading submerged fill method when
loading their tank wagons.  Additionally, vapors displaced from the
storage tanks by the rising gasoline level during tank filling would
no longer be allowed to escape into the air.  These vapors would be
captured and "balanced" (or sent) to the truck transport  making the
gasoline delivery.  Vapors would then accumulate in the emptying tank
compartments of the truck and be returned by the transport to the  bulk
terminal for eventual collection and disposal during the  transport's
next loading.  Accounts serviced by bulk plants would be  exempted  from
vapor balancing as the tank wagons would not be equipped  to handle
those vapors.  However, these accounts would be required  to install
submerged fill systems for their storage tanks.

2.   Option 2
     Option 2 is a more effective control strategy than Option 1.   Bulk
terminals would be required to employ the same degree of  vapor control
under this option as Option 1.  However, bulk plants would now be
required to install a balance system on all tank wagons in addition
to the balance system on storage tanks required by Option 1.   Tank
                                 1.12

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wagons would then be modified in order to receive gasoline vapors while
filling tanks at retail outlets and to transport these vapors back to
the bulk plant.  During subsequent tank wagon loading, the gasoline
vapors, which would have escaped through the hatch opening in Option 1,
would now be collected and sent to the emptying storage tank.  These
vapors, which are "balanced to storage," will eventually be "balanced
to transport" during the next transport delivery and be returned to
the bulk terminal for ultimate disposal.  Bulk plants would still load
their tank wagons using a submerged fill method.

3.   Option 3
     Option 3 provides the greatest reduction in benzene emissions of
the three control options.  Again, the control requirements of bulk
terminals are exactly the same as they were in Option 1 and Option 2.
Bulk plants, however, would now be required to install vapor collec-
tion and disposal systems similar to those required at bulk terminals.
These control systems would be of a smaller scale than those at
terminals, but all vapors would be collected and disposed of on-site.
No vapors would be "balanced to transport" and returned to the bulk
terminal.  All retail outlets serviced by bulk plants would be required
to install vapor balance systems.  A brief summary of the base case
assumptions and the proposed vapor control regulations is presented
in Table 1.5.

4.   Stand-by Systems
     It is the intention of the EPA that no  gasoline  loading be  per-
formed at bulk terminals or bulk plants if the continuous and efficient
operation of the vapor control systems cannot be assured.  A bulk
storage facility would have three alternatives should its vapor  control
system become temporarily inoperative:
     •  switch to a stand-by system,
     t  utilize a gasoline vapor holder to collect vapors until
        the control system is operational, or
     0  shut down gasoline loading operations until the control
        system is operational.
                                  1.13

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                                            TABLE 1.5
                    VAPOR CONTROL OPTIONS AT GASOLINE BULK STORAGE FACILITIES
SOURCE
BASE CASE
                                        a
                    CONTROL

                         b
                                                                    SCENARIO
  OPTION 1
                                                                OPTION 2'
  OPTION 3l
Termi nals

Filling Truck Transports
At The Loading Rack
   Top
Submerged
   Fill
   Vapor
Recovery or
Incineration
                                                                  Vapor
                                                               Recovery or
                                                               Incineration
   Vapor
Recovery or
Incineration
                                               Balance
                                              to Transport
                                              Submerged
                                                 Fill
                                  Balance
                                to Transport
                                  Balance
                                to Storage
                                     Vapor
                                  Recovery or
                                  Incineration

                                     Vapor
                                  Recovery or
                                  Incineration
Bulk Plants

Filling Gasoline
Storage Tanks                  Bottom Fill


Filling Tank Wagons
At The Loading Rack            Splash Fill

aMost common current.industry practice.

bVapors from all gasoline stations supplied from terminals will be balanced to the truck transport.
 Vapors from gasoline stations supplied from bulk plants will not be balanced to the tank wagons.

cVapors from all gasoline stations will be balanced to the supplying vehicles.  Service station
 tanks will be loaded via submerged fill.
Source: U.S. Environmental Protection Agency

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The EPA has provided Arthur D. Little with cost data for the first two
alternatives shown above.  Based on estimated capital  requirements, a
stand-by system was selected as the less expensive alternative that
would assure that gasoline vapors were continuously controlled.  Be-
cause both the decision to shut down gasoline loading operations and
the costs incurred from such a decision would vary considerably from
one installation to another, evaluating this alternative was considered
to be outside the scope of this study.  It may, however, be a viable
alternative for some facilities having very small gasoline throughputs.

5.   Model Vapor Control Systems
     The EPA has developed and provided to Arthur D. Little cost esti-
mates for model vapor control systems which would bring bulk terminals
and bulk plants into compliance with the above control options.  One
set of costs was prepared for the various control systems which could
be installed at bulk terminals.  However, for bulk plants, three sets
of costs for the possible control systems were prepared for each of the
three options.  Since it was outside the scope of this study to select
a "most appropriate" set of vapor control costs for bulk plants, we
evaluated the economic impacts of each of these three cost scenarios.
The three cost scenarios in descending order of installed capital
              123
costs are NOJC , Houston-Galveston , and Colorado APCD .  The EPA
has assumed that all of the above systems are equally efficient in con-
trolling gasoline vapors for each one of the three control options.
Since it may also be necessary for bulk terminals and bulk plants  in-
stalling vapor recovery systems to also install a stand-by  unit,  the
costs of primary control systems with an appropriate back-up unit were
 NOJC - the most expensive control system described by McCormack and
        Schuster of the California Independent Oil Marketers Association
        (National Oil Jobbers Council, a jobber trade association).
 2
 Houston-Galveston - a top loading version of the Wiggins System.
 Colorado APCD - the least expensive control system reported by the
        Colorado Air Pollution Control Division (APCD).
                                 1.15

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also provided.

D.   CLOSURE ANALYSIS
1.   Bulk Storage Models
     Because it would be impossible to assess the economic impacts of
each of the proposed vapor control options for the bulk storage indus-
try on an individual basis, Arthur D. Little has developed six bulk
storage models, each representative of segments of the bulk storage
industry, to be used as illustrative analytical tools.  By using these
bulk storage models in conjunction with the model vapor control systems
developed by the EPA, economic and financial parameters, e.g.  profit-
ability, debt capacity, and tariff rates, were tested under base case
conditions and then for each of the proposed regulations.   The
changes in these variables provided valuable insight in conducting
the economic impact analysis by indicating how and to what degree the
bulk storage industry might actually be affected by the vapor control
options.

2.   Cost Pass Through Assumptions
     Although 100% of the costs associated with vapor control  may be
passed through to buyers, we have assumed that the incremental costs
of vapor control may  be absorbed by the bulk storage models to vary-
ing degrees.  The price setter or market leader of each type of
storage facility in an area was assumed to be the most efficient
facility and, presumably, the largest.  This facility, because of
its unique market position, will be able to pass through the full
cost of vapor control by increasing its tariff to where it covers all  of
its incremental vapor control  costs and hence, does not experience any
decline in margin.  A less efficient facility, however, competing with
the market leader, will be constrained to only passing through, at most,
the same unit cost as the market leader, thereby absorbing some of the
cost and causing a decrease in margin.  Only the small marine  terminal
and small bulk plant models are assumed to be constrained  in the amount
of vapor control costs they can pass through in the form of tariff
                                 1.16

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increases.   The cost pass through of these facilities  is assumed  to  be
limited to  the same cost per gallon increases  as  the larger,  more
efficient marine terminal and bulk plant models with which  these
smaller facilities are assumed to be in competition.  All  of  the
other models are assumed to be able to pass through the full  cost
of vapor control.   A summary of these pass through assumptions
appears in  Table 1.6.

3.   Facilities Subject to the Proposed Control Options
     Bulk storage facilities which are not subject to this  closure
analysis include bulk terminals and bulk plants which would close
anyway due  to reasons other than vapor control, non-gasoline  terminals
and bulk plants, and facilities which already have installed  the
necessary vapor control equipment.  All other facilities would be
subject to  possible closure as a consequence of the vapor control
strategies  outlined earlier.

4.   Bulk Storage Closures
     Bulk terminals and bulk plants subject to vapor control  regula-
tions are assumed to close because of either of the following two
reasons:

     •  Operators are unable to obtain the capital necessary to
        install vapor control equipment, or
     •  Storage facilities would operate below a minimum acceptable
        level of profitability if vapor control equipment were
        installed.

     a.  Availability of Capital
     For this analysis, each bulk storage facility is treated as  a
separate profit center in determining its ability to secure the capital
necessary to install vapor control equipment.  Because an in-depth
financial examination of each and every facility was impractical  as
well as infeasible, the bulk storage models developed by Arthur D.
Little will act as surrogates for the bulk terminal industry.  In our
analysis, if the model's anticipated after-tax cash flow, i.e. net
                                1.17

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                                                      TABLE 1.6
                                        COMPETITIVE PASS THROUGH ASSUMPTIONS
                    FACILITY PROTOTYPE
                                 LOW THROUGHPUT
                                                                    1
HIGH THROUGHPUT'
00
Marine Terminal



Pipeline Terminal



Bulk Plant
                                                     Partial Pass Through
                                                     Full Pass Through
                                                     Partial Pass Through
                    1
Full Pass Through
Full  Pass Through
Full  Pass Through
                     Gasoline throughput is 250,000 gallons/day for bulk terminals and 4,000 gallons/
                     day for bulk plants.
                    •Gasoline throughput is 500,000 gallons/day for bulk terminals and 20,000 gallons/
                     day for bulk plants.

-------
profit plus depreciation, covers its total  debt obligation, i.e.
principal of pre-vapor control and vapor control  related debt,   the
necessary capital will most likely be made available.

     Because the projected after-tax cash flow of all  the bulk  terminal
models was sufficient to meet all debt obligations, both pre- and post-
vapor control, it was concluded that no bulk terminal  closures  were
likely because of an inability to obtain capital.  However, depending
upon the control option and the cost scenario chosen in the bulk plant
analysis, post-vapor control cash flow was  often not sufficient to
obtain the capital required to install vapor control equipment.  Even
after considering non-standard financing almost 9,000 bulk plants, or
48% of the estimated 1978 bulk plant population, would still not be
able to obtain financing for some of the Option 3 control systems.  No
bulk plant closures are expected to occur because of Option 1,  which
has the smallest capital requirement of the three control options
Table 1.7).  Option 2 is expected to cause approximately 1,690  facili-
ties, or 12% of all gasoline bulk plants, to close if the NOJC, or
most expensive, cost scenario is assumed.  No closures are expected
for Option 2 for the other two cost scenarios.  Because Option  3
compliance requires the greatest amount of capital, it is the option
expected to cause the largest number of bulk plant closures.  The
number of likely bulk plant closures as the result of Option 3
ranges from 1,060 for a Colorado APCD incineration unit to 8,990 for
a NOJC refrigeration/incineration system.

     b.  Insufficient Profitability
     Many of the bulk storage facilities having access to adequate
amounts of capital may still close because of vapor control economics.
Those falling to achieve a minimum level of profitability after vapor
control equipment is installed are assumed to close.  Facilities will
remain open as long as their operators can meet all current liabilities,
i.e., operating expenses (including salaries) and debt obligations
(principal and interest).  Bulk storage facilities would continue to
 Interest payments are included in the cash flow figure.
                                 1.19

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                                                     TABLE  1.7


                                          BULK PLANT CLOSURES BECAUSE OF

                                             INACCESSIBILITY OF CAPITAL
                                                    CONTROL   STRATEGY
                              OPTION 1
OPTION 2
                                   OPTION 3             _
                                               Primary System

              Primary Control Syste.    Refl.ige"rat1on/atcLrat1on/
                              Balance
                              Incoming
                             Trucks Only   Outgoing Trucks   Refrigeration   Incineration   Incineration    Incineration
ro
o
      NOJC Cost Scenario
      Houston-Galveston
       Cost Scenario
1,690
                  8,930
                8,890
6,080        8,990
4,370        8,960
                           8,880
                                                            8,820
      Coloardo APCD
       Cost Scenario
                8,870
1,060        8,950
                                                            8,820
      Source: Arthur D. Little,  Inc.

-------
operate under these conditions, even if no return on equity investment
was realized, if operators have limited business alternatives for their
equity investment or believe that profitability will increase in the
future as other facilities close.

     In order to generate a revenue stream sufficient to continue
operations, i.e. to break even, a minimum product throughput at all
bulk terminals must be sustained.  After netting out the revenue con-
tribution of the non-gasoline products, the revenue necessary to meet
the remaining current liabilities must be generated through gasoline
volumes.  The gasoline volume necessary for the model facilities to
remain open was then calculated.

     Bulk storage facilities unable to pass through the full cost of
vapor control would be forced to absorb the remaining control costs
and their minimum required gasoline volumes would increase as a result.
This increase could cause some facilities, which are now just breaking
even or marginally profitable, to operate at a loss.  Using a distri-
bution of storage facilities by gasoline throughput, and the increase
in gasoline throughput necessary to offset the absorbed vapor control
costs, the number of terminals and bulk plants which would now operate
below their gasoline breakeven throughput as a result of vapor control
economics, and presumably close, was calculated.

     From the above analysis, between 23 and 51 bulk terminals, or 2%
to 5% of the gasoline terminals subject to vapor control regulations,
are  likely to close because they would be operating at less than a
breakeven level.  Depending upon the specific control option and cost
scenario, bulk plant closures are expected to range from zero to 1,300.
Closures resulting from Option 1 are estimated to be 130 for the NOJC
and Houston-Galveston cost scenarios and zero for the Colorado APCD
cost scenario (Table 1.8).  Closures resulting from Option 2 range from
 The throughputs of the non-gasoline products, and hence, their revenue
 contribution are assumed  to  remain the same.
                                  1.21

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                                                      TABLE  1.8


                                             BULK PLANT  CLOSURES  BECAUSE  OF

                                               INSUFFICIENT  PROFITABILITY
                               OPTION  1


                               Balance
                               Incoming
                                                      CONTROL     STRATEGY
             OPTION 2
                                                     OPTION 3
            Balance In-
            Coming* &
                                Primary Control System
                              Primary System
                              With Stand-By
                                                            Refrigeration/ Incineration/
Trucks Only  Outgoing Trucks  Refrigeration  Incineration    Incineration  Incineration
ro
ro
       NOJC  Cost  Scenario
130
                  530
1,040
900
1,300
800
       Houston-Calveston
        Cost Scenario
130
                  240
  920
890
1,180
690
       Colorado APCD
        Cost Scenario
                50
                                     840
             1,010
             1,100
                610
       Source:  Arthur D.  Little,  Inc.

-------
50 to 530 facilities, while Option 3 compliance is  expected to cause
between 600 and 1,300 bulk plants to close.   It should be noted,  how-
ever, that while bulk plant closures due to  insufficient profitability
appear far less significant than closures due to inaccessibility  of
capital, this phenomenon  is the result of the arbitrary ordering of
the above two analytical steps and not the inherent significance  of
either factor.  Before conducting the profitability analysis, the
expected capital-related closures were netted out of the potentially  impact-
ed population and their gasoline throughput  redistributed among the
remaining storage facilities.  A summary of the closure impacts on the
bulk storage industry due to the three vapor control options, both
high and low estimates, is presented in Table 1.9.

E.   EMPLOYMENT AND COST IMPACTS
     a.  Employment
     The employment impacted or displaced is directly proportional, as
would be expected, to the facility closures  caused by vapor control.
Between 300 and 700 workers employed at gasoline bulk terminals and
up to 43,730 workers employed at bulk plants would be displaced by the
vapor control induced closures.  A summary of these employment impacts
is presented for the three proposed vapor control options in Table
1.10.

     b.  Cost
     The nationwide cost of installing, financing and operating vapor
control systems varies significantly by control option, control tech-
nology and cost scenario.  High and low estimates for each control
option appear in Table I.11.   The total costs of compliance under
Option 1 range from $281 million to $719 million.  The vapor control
costs required to comply with Option 2 range from $297 million to $1.1
billion, while Option 3 costs vary from $832 million to $1.4 billion.
These costs represent a substantial portion of the petroleum industry's
$1.2 billion 1977 environmental budget for the control of air pollution.
Additionally, in 1977 the major oil companies' total budget for
                                 1.23

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                                              TABLE  1.9
Primary Vapor Control
Bulk Terminal
Bulk Plant2
Primary Vapor Control
With a Stand- By Unit
Bulk Terminal3
Bulk Plant2
CLOSURE IMPACT OF THE

Option
High
System
32
130
System
51
130
PROPOSED

1
Low

23
0
46
0
VAPOR CONTROL
- CONTROL STRA
Option
High
32
2,220
51
2,220
OPTIONS
TCPV
1 tUI "
2
Low

23
50
46
50

Option 3
High Low

32 23
9,970 1 ,900
51 46
10,290 9,430
 The High and Low estimates result from using the incineration system and the refrigeration  system
 respectively, as the cost basis.
2
 The High estimate results from using the NOJC cost scenario, while the Low estimate  results  from
 using the Colorado APCD cost scenario.  The closure impact of the Houston-Galveston  cost  scenario
 falls between these two estimates.


 The High and Low estimates result from using the incineration system with incineration  stand-by and
 the refrigeration system with incineration stand-by,  respectively.

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                                                    TABLE I.10
                               EMPLOYMENT IMPACT OF THE PROPOSED VAPOR CONTROL OPTIONS
ro
en

Option 1
High Low
rnwTRni ^TRATFRY
l/Ult 1 IIUL J 1 (VA 1 C. U I 	
Option 2
High Low

Option 3
High Low
Primary Vapor Control System

  Bulk Terminal1

  Bulk Plant2

    Total  Employment


Primary Vapor Control System
With a Stand-By Unit	

  Bulk Terminal3

  Bulk Plant2"

    Total  Employment
450
550
1,000
320
0
320
450
9,440
9,890
320
210
530
710
550
1,260
640
0
640
710
9.440
10,150
640
210
850
                                                                                            450        320

                                                                                         42.370      8.800

                                                                                         42,820      9,120
                                                                                            710         640

                                                                                         43.730      40.080

                                                                                         44,440      40,720
        The High and Low estimates  result from using the  incineration  system and  the  refrigeration  system,
        respectively, as the cost basis.     '
       2
        The High estimate results from using the NOJC cost  scenario, While  the  Low estimate  results  from
        using the Colorado APCD cost scenario.  The  employment  impact  of the Houston-Galveston  cost
        scenario falls between these two  estimates.
        The  High  and Low estimates  result from using the  incineration  system  with  incineration  stand-by
        and  the refrigeration  system with incineration  stand-by,  respectively.

-------
r\>
                                 TOTAL  COS!
      TABLE 1.  _
OF THE PROPOSED VAPOR CONTROL  OPTIONS
1(MilTifon~TWT5"ol
Tarsi



,.,„ 	 _ rnMToni CTr>«-rrr>v


Single Vapor Control System
Bulk Terminal Cost2
Conversion of the Tank
Trailer Fleet
Bulk Plant Cost3
Total Cost
Vapor Control System
With Stand-By Unit
Bulk Terminal Cost4
Conversion of the Tank
Trailer Fleet
Bulk Plant Cost3
Option
High

329.0
101.4
36.9
467.3 ,


580.4
101.4
36.9
1
Low

201.9
101.4
(22. 7)5
280.6


473.2
101.4
(22.7)
uun i [\UL. -Jir\nii-ui — —
Option 2
High

329.0
101.4
375.5
805.9


580.4
101.4
375.5
Low

201.9
101.4
(6.5)
296.8


473.2
101.4
(6.5)
Option
High

329.0
101.4
651.3
1,081.7


580.4
101.4
747.3
3
Low

201.9
101.4
528.6
831.9


473.2
101.4
465.2
Total Cost
                                         718.7
551.9
1,057.3
                                568.1
1,429.1     1,039.8
      1
       Total cost Includes capital charge, financing cost and operating expense  less  any applicable  recovery
       credit.  All future expenses and credits have been discounted to present  value using  a  discount rate
       of 10%.
      2
       The High and Low estimates result from using the incineration system and  the refrigeration  system,
       respectively, as the cost basis.
      3
       The High estimate results from using the NOJC cost scenario, while the Low estimate results  from
       using the Colorado APCD cost scenario.  The cost impact of the Houston-Gal veston  cost scenario falls
       between these two estimates.
      4
       The High and Low estimates result from using the incineration system with incineration  stand-by and
       the refrigeration system with incineration stand-by, respectively.
       Indicates a net savings because the present value of the recovery credit  exceeds  the  estimated 1978
       ^apor  control  expenses.

-------
environmental effluent abatement was estimated to be only $803 million,
of which marketing's share was approximately $120 million.
                                  1.27

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                  II.  MARKET AUDIT OF BULK TERMINALS

A.  INTRODUCTION
1.  Definition and Operational  Profile
     Although a bulk terminal is significantly  larger  than  a  bulk  plant,
having a total storage capacity typically in  excess of 50,000 barrels,
there is no well-defined and universally-accepted set  of physical
characteristics which uniquely defines a bulk terminal.   Rather, the
definition of a terminal is more often derived  from its  function within
the petroleum marketing network.  Therefore,  within the  scope of this
study, we will assert that a bulk terminal operates as a primary
storage facility receiving petroleum products directly from domestic
or offshore refineries for eventual market distribution.  Because  the
primary economic impacts of the proposed vapor control regulations,
e.g. incremental investment requirements or possible  terminal closures,
will only occur at facilities which store and distribute gasoline,
the bulk terminals comprising the gasoline distribution network will
be the principal focus of the following operational  profile.

     Pipelines, tankers and barges transport U.S. gasoline throughput,
both domestic production and imports, from refinery  storage tanks  to
bulk terminal storage (Figure II.l).  Because pipeline transportation
is significantly less expensive than waterborne shipment (Figure  11.2),
most of the gasoline throughput in the U.S. is handled by pipeline
terminals.  However, since most product pipelines in  the U.S. are
currently operating at full capacity, the marginal or incremental
barrel of product in many regions moves by water through marine  ter-
minals.  Additionally, almost all gasoline imports,  primarily origina-
ting in the Caribbean, are received at marine terminals for domestic
distribution.
 Part of the definition used by the Department of Commerce when con-
 ducting its Census of Wholesale Trade.
                                  II.l

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                                 FIGURE  11.1

                     GASOLINE DISTRIBUTION NETWORK
                                   Refinery
                                     I
1
F
Marine
Terminal
      t_	
              Service
              Stations
                T
           Automobiles,
              Trucks
o
Storage

Transfer

More Common Path
Less Common Path
                                                              Pipeline
                                                             Terminal
                                                           J
                                                              Bulk
                                                              Plant
                                                  Commercial and
                                                  Rural Accounts
                                                               T
                                                        Automobiles, Trucks,
                                                          Farm Machinery
                                       II.2

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                            FIGURE 11.2

          GASOLINE TRANSPORTATION COSTS GULF COAST TO NEW YORK
              SPOT TANKER RATES VS. COLONIAL PIPELINE
                                       Colonial Pipeline Tariff
JFMAMJJASONDJFMAMJJASONDJFMAMJJASOND
        1976                    1977                     1978
                               II.3

-------
     A typical bulk terminal  distributes all  of the gasoline which it
receives through its loading racks into truck transports.   These
transports usually have tank capacities between 8,000 and  9,500
gallons and deliver gasoline directly to service stations  or deliver
to bulk plants for further distribution.  Most of the transports
delivering gasoline are owned by common carriers with the  bulk terminal
operators owning the majority of the remaining fleet.  Shipments  of
gasoline from terminals by pipeline, barge or rail  car occur infre-
quently and only in areas having unusual logistical  constraints or
opportunities.

2.  Historical Market Environment
     For more than a quarter of a century until about 1970,  the
marketing philosophy of the integrated oil companies was to  maximize
the flow of petroleum products through their marketing networks.
This philosophy evolved from the fact that the production  of both
domestic and foreign crudes contributed the most significant portion
of the total corporate profits of these companies.   In order to "draw"
more barrels of crude oil out of the ground, and hence, more profits,
an aggressive construction program of downstream marketing facilities,
including terminals, bulk plants and service stations, was conducted.
The construction and operation of many of these marketing  facilities
was justified and supported,  not by the individual  facility's profit-
ability outlook or performance, but by the upstream profits  of crude
production.

     The conditions which induced the petroleum companies  to over-
build their marketing networks in the 1950's and early 1960's
disappeared by the end of the 1960's.  The integrated oil  companies
began to view their marketing and/or refining operations as  separate
profit centers to be judged on "stand alone" economics. Marketing
activities, including bulk storage operations, could no longer be
subsidized by upstream profits and were now expected to recover all
operating expenses as well as to provide an acceptable return on
                               II.4

-------
capital.  "Stand alone" economics caused gasoline marketers,  both
majors and independents, to review their marketing strengths  and to
re-evaluate their overall corporate marketing strategies.   Many of
the integrated petroleum companies shifted their marketing philosophy
from volume maximization to profit maximization.  Investment  in new
marketing facilities declined and older, marginal terminals,  bulk
plants and service stations were sold, consolidated or closed as
market conditions rendered them uneconomic.  Through this  "market
rationalization" process, some companies scaled down their marketing
activities or withdrew entirely from selected areas where  they had
over-extended their supply or marketing capabilities.  The trend of
"market rationalization," which was well underway by the early 1970's,
was accelerated by the market conditions resulting from the OAPEC
Embargo of 1973-1974.

B.  AUDIT SUMMARY
     This discussion of the bulk terminal industry will focus on  five
of its primary characteristics:

                 •  Population
                 •  Storage Capacity
                 •  Size Distribution
                 t  Ownership, and
                 •  Employment.
The section on size distribution includes a discussion of both shell
storage capacity and average daily throughput.  Also, when appropriate,
regional differences or trends pertinent to  an understanding of the
nature of the bulk terminal industry are identified.  The information
that comprised the basis of this audit was compiled from government,
industry and trade association reports, field interviews,  and in-
house Arthur D. Little sources.  The data obtained from the above
sources was then verified and cross-checked to assure a high  level  of
confidence in the audit  results.
                                II.5

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1.   Population
     In 1978, there were an estimated 1,751  petroleum bulk  terminals
in the U.S. (Table II.1).  This figure represents a 9% decline  from
the 1,925 bulk terminals identified by the Department of Commerce  in
     2
1972.   This attrition has been the result of the rationalization
process of the petroleum marketers largely affecting the less efficient
facilities.  Of the 1,751 terminals identified in 1978, approximately
86% or 1,511 store gasoline.   Terminals not storing gasoline may
specialize in distillate, residual or bunker fuel sales. Most  bulk
terminals are located in PADD's I and II (Figure II.3) which together
account for two-thirds of the bulk terminal  population.  PADD I has
43% of all petroleum bulk plants and 43% of those storing gasoline,
while PADD II has 24% and 23%, respectively.  The large number  of  bulk
terminals in these two PADD's reflects the regions' lack of refining
self-sufficiency and their reliance on shipments from other PADD's and
from foreign sources in order to meet their total product (Table 11.2)
and gasoline (Table II.3) demand.

2.  Storage Capacity
     While the total number of terminals declined between 1972  and 1978,
total storage increased by approximately 30% from 593 million barrels
to 771 million barrels as larger terminals expanded via new construc-
tion or consolidated smaller, less efficient facilities into their
operations.  Gasoline storage capacity increased to an estimated 296
million barrels of shell capacity or 38% of total product storage.
Because most of the bulk terminal population is located in  PADD's  I
and II, these two regions account for most of the storage capacity with
73% of total product storage and 72% of the gasoline storage.
 This figure does not include crude or LPG terminals which were
^excluded from consideration in this study.
 Bureau of Census, 1972 Census of Wholesale Trade.
                                 II.6

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TABLE II.I



1978
BULK TERMINAL POPULATION
nil nrrnni CUM -rroMTM/H c
PADD
Number Percent
of of Total Storage
Terminals Total Capacity
Percent
of
Total
Number
of
Terminals
Thousand Thousand
Barrels Cu. Meters
I
II
III
IV
V
Total
Source:
745
429
276
39
262
1,751
Bureau of
Petroleum
Liquid Ter
43% 403,633
24% 158,219
16% 126,223
' 2% 7,238
15% 75,403
100% 770,716
Census, 1972 Census
64,172
25,155
20,068
1,151
11,988
52%
21%
16%
1%
10%
122,534 100%
of Wholesale Trade;
News, Factbook (1972-1978); Independent
-rninals and Storage
Facilities;
Industry
657
343
234
39
238
1,511
U.S. Army Corps
Liquid Terminals
contacts; Arthur
TFPMTNAI ^ ^TflPTMR TACini TMF
1 C.rslTll linLj olUKiliu UrtOULllit 	 —
Percent
of Gasoline Storage
Total Capacity
Thousand Thousand
Barrels Cu. Meters
43% 149,792 23,815 .
23% 62,115 9,875
15% 51,753 8,228
3% 4,240 674
16% 28,408 4,517
100% 296,308 47,109
of Engineers, Port Series; National
Association, 1978 Directory - Bulk
D. Little, Inc.

Percent
of
Total
51%
21%
17%
1%
10%
100%

-------

(Includes
 Alaska &
 Hawaii)
                   FIGURE 11.3   PETROLEUM ADMINISTRATION FOR DEFENSE DISTRICTS

-------
                                          TABLE 11.2
PADO
I
II
III
IV
V
Total
Includes
Source: U.
1978 REGIONAL PRODUCT SUPPLY/DEMAND BALANCE
(Thousand Barrels/Day)
	 	 ,., 	 	 	 INTFR PADO IHTPMFNT1; ,
Regional Refinery From From From From From
Demand Output PADD I PADD II PADD III PADD IV PADD V Imports
6,498 1,815 -- 66 3,100 -- -- 1,671
5,219 3,950 220 — 791 42 — 129
3,942 6,602 -- 126 -- — 3 22
547 498 -- 68 — -- 14 13
2,621 2,392 - -- 83 71 -- 120
18,827 15,257 . 1,955
stock changes
,S. Department of Energy, Supply, Demand and Stock of All Oils By PAD Districts and Imports
Other
66
347
1,163
67
(28)
1,615

into the
United States, by Country.

-------
TABLE II.3
PAOO
I
II
III
IV
V
Total
Includes
Source: U
1978 REGIONAL GASOLINE SUPPLY/DEMAND BALANCE
(Thousand Barrels/Day)
IMTTD DAnn curnuruTc
Regional Refinery From From From From From
Demand Output PADD I PADD II PADD III PADD IV PADD V Imports
2,521 733 -- 27 1,703 - -. 16Q
2,516 1,962 161- -- 281 17 - 7
1,026 2,529 -- 53 i 3
252 220 -- 43 - 7 i
1,139 989 -- - 47 34 .. 25
7,454 6.473 196
stock changes
.S. Department of Energy, Supply, Demand and Stock of All Oils By PAD Districts and Imports
Other
19
211
471
32
52
785

Into the

-------
3.   Size Distribution
     a.   Storage Capacity
     Small  facilities comprise  the  largest  portion of the  bulk terminal
population.  Almost half, 48%,  of all  product  terminals  have a total
storage  capacity that is less than  200,000  barrels, while  approximately
another  third, 30%, have a total  storage  capacity between  200,000 and
600,000  barrels (Table II.4).  Similarly, half of the terminals storing
gasoline have total storage capacities that are  less than  200,000
barrels  and of these, more than a quarter,  28%,  are between 200,000 and
600,000  barrels.  A more detailed presentation of product  and gasoline
capacities  appears in Appendix  A.

     b.   Average Daily Throughput
     Another measure of a bulk  terminal's size is its average daily
throughput  of petroleum products, particularly gasoline.   Almost two-
thirds,  63%, of all bulk terminals  have a daily  product  throughput that
is  less  than 680,000 gallons and over  a third  of these,  36%, are less
than 170,000 gallons (Table II.5).   Of the  bulk  terminals  storing
gasoline, three-quarters have an average  gasoline throughput that is
less than 400,000 gallons/day of which almost  half, 48%, are less than
200,000  gallons/day.

4.   Ownership
     Major  and semi-major oil companies  own the majority  of the
product  bulk terminals and the  gasoline terminals with 67% and 72%,
respectively (Table 11.6).  Independents, including regional refiners,
                             2                             3
marketer/wholesalers, jobbers  and bulk liquid warehousers,  own the
remaining 33% and 28%.  Majors  also own a proportionately  greater
 Hereafter referred to as simply majors.   For a  listing of the  individual
 companies comprising these two groups, see Appendix B.
2
 A jobber is a petroleum distributor who  purchases  refined product from
 a refiner or terminal operator for the purpose  of  reselling  to retail
 outlets, commercial and agricultural  accounts,  or  through his own
 retail outlets.
3
 Bulk liquid warehousers only store petroleum products  at  their terminals
 for a fee and do not market the product  themselves.

                              11.11

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                                                       TABLE  II.4
PO
BULK TERMINAL STORAGE DISTRIBUTION
ALL
—PETROLEUM TERMINALS —
Total Storage
Capacity
Thousand
Barrels
>200
200-600
600-1 ,000
< 1 ,000
Thousand
Cu. Meters
>30
30-95
95-160
<160
Number of
Terminals
834
534
215
168
Percent
of Total
48%
30%
12%
10%
TERMINALS
	 STORING GASOLINE 	
Number of
Terminals
764
423
192
132
Percent
of Total
50%
28%
13%
9%
            TOTAL
                           1,751
                                                            100%
1,511
100%
         Source:
Bureau of Census,  1972  Census  of Wholesale Trade; U.S. Army Corps of Engineers,  Port Series;
National  Petroleum News.  Factbook (1972-1978TTTndependent Liquid Terminals Association,	
1978 Directory - Bulk Liquid Terminals and Storage Facilities; Industry contacts; Arthur
D.  Little, Inc.                        ~~

-------
                                               TABLE II.5
BULK TERMINAL
. . .,_ A| 1 PFTRDI FIIM TFRMTNfll <\ • 	 	
MLL 1C 1 KULCUrl 1 LKI'llllMLo
Percent
Average Product Number of of
Throughput Terminals Total
Thousand Cubic
Gallons/Day Meters/Day
<170 <640 626 36%
170-670 640-2,540 475 27%
670-1,850 2,540-7,000 375 21%
>1,850 >7,000 275 16%
Total 1,751 100%
THROUGHPUT DISTRIBUTION
TFRMTNfll *t ^TfiPTMr PACOI TMF
1 LKrUINHLo olUKlINu UMoULlINt 	 	 	
Percent
Average Gasoline Number of of
Throughput Terminals Total
Thousand Cubic
Gallons/Day Meters/Day
<200 <750 728 48%
200-400 750-1,510 401 27%
400-600 1,510-2,270 312 21%
>600 >2,270 70 4%
1,511 100%
Source:  Bureau of Census,  1972 Census  of Wholesale  Trade;  Industry Contacts; Arthur D. Little, Inc.

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                                           TABLE 11.6
Ownership
 Segment
Number of
Terminals
                                  1978 BULK TERMINAL OWNERSHIP

                                         ALL
                                 -PETROLEUM TERMINALS	
Percent
of Total
                                             TERMINALS
                                      	STORING GASOLINE-
Number of
Terminals
Percent
of Total
Majors & Semi-Majors
Independents
Total
  1,170


    581


  1,751
  67%


  33%


 100%
   1,086


     425


   1,511
    72%


    28%


   100%
Source:  U.S.  Army Corps of Engineers,  Port Series;  National  Petroleum News, Factbook (1972-1978);
         Independent Liquid Terminals Association, 1978  Directory  - Bulk Liquid Terminals and
         Storage Facilities; Industry contacts; Arthur D.  Little,  Inc.

-------
number of the larger terminals  than  do  the  independents.  While majors
own approximately 72% of all  gasoline terminals,  they own over 84% of  those
facilities having a total  storage capacity  greater  than 200,000 barrels,
but only 59% of the gasoline  terminals  having  a total  storage less than
200,000 barrels (Table II.7).  This  disparity  is  expected to grow as
majors shift a larger portion of their  operations from smaller to larger
terminals due to the greater  efficiencies of the  larger facilities.

5.  Employment
     The number of employees  in the  bulk terminal industry  in 1978 was
  •
approximately 35,700 (Table II.8).  This figure represents  a decline
of 11% from the 40,220 employees reported in  1972 by the  Department of
Commerce.  The employment level at gasoline bulk  terminals  in 1978 was
estimated at 30,830, or 86% of  total  terminal  employment.   Employment
levels have fallen over this  period  because of bulk terminal closures
and consolidations, and because of the industry's trend towards greater
automation as a means of increasing efficiencies  and reducing labor
costs.  Since most of the bulk  terminals are  located in  PADD's I  and
II, these regions account for over three-quarters of the  industry's
employment.

C.   BULK TERMINAL TRENDS
1.   New Construction
     Recent gasoline demand forecasts have indicated that only a  modest
increase in consumption is likely through 1980 and  that a demand  down-
turn will occur by the early 1980's  and continue through  1990  (Table
II.9).  It is, therefore, reasonable to conclude that  the construction
of new bulk terminals to handle significant additional  quantities of
gasoline throughput will not be necessary, although gasoline storage
at existing facilities in selected growth areas will probably increase.
This conclusion is supported by discussions with industry sources which
indicated that few, if any, new gasoline terminals  are expected to be
built in the foreseeable future.
                               11.15

-------
    Total Storage
      Capacity
Thousand   Thousand
Barrels   Cu.  Meters
 <200      <30


 200-600    30-95


 600-1,000  95-160


 >1,000    >160


 Percent Total
 Total  Number  of
  Gasoline  Terminals
                                              TABLE 11.7


                                    GASOLINE TERMINAL DISTRIBUTION

                                         BY SIZE AND OWNERSHIP



                         -  PERCENT OF TERMINALS STORING GASOLINE -
Majors and
Semi-Majors
   30%


   25%


   10%


    7%


   72%



 1,086
Independents
     21%


     •3%


      3%


      2%


     28%



     425
Percent
of Total
  50%


  28%


  13%


   9%


 100%
     Total  Number of
Terminals Storing Gasoline
           764


           423


           192


           132
                        1,511
 Source:  Bureau  of  Census,  1972  Census  of Wholesale Trade; U.S. Army Corps of Engineers, Port Series;
         National Petroleum News,  Factbook  (1972-1978);  Independent Liquid Terminals Association, 1978
         Directory  -  Bulk Liquid Terminals  and Storage Facilities; Industry contacts; Arthur D. Little, Inc

-------
                               TABLE  II.8
1978 BULK TERMINAL EMPLOYMENT
ALL
DCTDni CUM TCDMTMAI C CTn
PADD
I
II
in
IV
V
Total
Source:
i i_ i i\vji- L-UII i i_i\rn nr\i_o
Percent
Employment of Total
19,280
7,850
4,460
440
3,670
35,700
Bureau of Census, 1972 Census
55%
22%
12%
1%
10%
100%
of Wholesale Trade
Port Series; National Petroleum News, Factbook,
TERMINALS
ir>TMr> r'Kcni TMT
OIUFMI1U UMOULlltL 	
Percent
Employment of Total
17,000
6,280
3,770
440
3,340
30,830
; U.S. Army
(1972-1978);
56%
20%
12%
1%
11%
100%
Corp of Engineers
Industry contact;
Arthur D. Little, Inc.

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                                                      TABLE II.9
                             A COMPARISON OF RECENT FORECASTS OF U.S.  GASOLINE CONSUMPTION
                                              (Millions of Barrels/Day)

                                                                   1980              1985             1990
         Study for DOE by Energy and Environmental                 , ,cn             _  .__            e „„
         Analysis (January 1979)1                                 6'769             6'175            5»673
         FIRING (March 1979)                                      7,561
         Shell  (July 1978)2                                       7,050             6,773    .        6,709
         Bankers'  Trust (October 1978)3
_           Passenger Car Use                                     5,400             4,900            4,300
r           Other Vehicles & Off-Highway (ADL)                     2,264             2,368            2.316
00                                                                 7,664             7,268            6,616
         Sun Petroleum (August 1978)                              7,567             7,175            6,784
         Arthur D.  Little (May 1979)
            Low Case                                               7,384             6,790            6,151
            High Case                                             7,384             6,797            6,464

          Excludes  off-highway use,  but includes  all  gasoline-powered  vehicles.
         2
          Shell  forecast  stated in crude oil  equivalent.   Conversion to  barrels of  gasoline assumes crude
          @ 5.6 MM  Btu/Bbl  and gasoline @ 5.25 MM Btu/Bbl.
          Bankers'  Trust  projections included only  passenger  car  consumption.  Arthur D. Little estimates
          for trucks, vessels, and off-highway have  been  added.

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2.   Existing Bulk Terminals
     "Stand alone" economics and the market rationalization of petroleum
companies are expected to continue exerting closure  pressure on margin-
ally profitable facilities.   Although most closures  and consolidations
in the bulk terminal  industry have already occurred, approximately 20
small  marine terminals, or 3% of the terminals  having an  average
daily gasoline throughput less than 200,000 gallons, are  expected to
close or to consolidate their operations between  1978 and 1983  (Figure
II.4).  The approximate magnitude of these closures, which represents
less than 1% of the bulk terminal population, was also confirmed
through industry discussions.

     As marginal bulk terminals close, the average daily  gasoline
throughput at other nearby terminals will increase to compensate  for
the loss of those facilities.  This phenomenon, however,  will  be more
than offset by the long-term overall decline in gasoline  consumption.
A shift in ownership from majors to independents is also  expected to
occur as some majors either reduce their marketing activities  or  with-
draw entirely from selected regions.  Throughout the 1978-1983 period,
bulk terminal  employment is expected to decline as unprofitable
facilities close.  Employment will also decline as more bulk
terminals install automated equipment in order to reduce  labor costs
and to increase marketing efficiencies.
                                11.19

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2500
2000
1,925
                             1,750
                                 1,730
1500
1000
 500
            1972
                1978
1983
            FIGURE 11.4  ESTIMATED 1983 BULK TERMINAL
                       POPULATION BEFORE VAPOR
                       CONTROL IMPACTS
                             11.20

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                   III. MARKET AUDIT OF BULK PLANTS

A.  "INTRODUCTION
1.   Definition and Operational Profile
     As in the case of bulk terminals, the definition of petroleum
bulk plants is more often derived from its function within the  petro-
leum marketing network than from a well-defined set of physical
characteristics.  Therefore, within the scope of this study,  we will
define bulk plants as secondary bulk storage facilities which operate
as satellite distribution centers of primary bulk terminals and which
receive petroleum products from terminals by truck transport  (Figure
III.l).  Some minor regional variations regarding the mode of delivery,
however, do exist.  Bulk plants supplied by rail  are most common in
the Rocky Mountain states and along the West Coast, pipeline  deliveries
occur in parts of the Northwest and Midwest, while barge transportation
occurs along the coasts, particularly around the New York Harbor area.
Since the proposed vapor control regulations will only impact those
facilities storing and distributing gasoline, the following operational
profile will focus on those bulk plants which are a part of the gasoline
distribution network.

     Bulk plants typically serve agricultural and commercial  accounts
in addition to retail outlets, and therefore, handle a variety  of
petroleum products, e.g., gasoline, kerosene, diesel fuel and distillates
Many of the bulk plants in the Northeast, however, tend to specialize
in either gasoline or distillate sales.  While most of the U.S. gasoline
throughput moves directly from bulk terminals to service stations and
large end-users by truck transport, bulk plants distribute gasoline
via smaller tank wagons to accounts requiring small and infrequent
deliveries, to customers whose storage capacities are insufficient to
permit transport-sized drops, or to large-end users if the access roads
are impassable to transport traffic.  Tank wagons usually have  tank
capacities between 2,000 and 4,000 gallons and are owned by the bulk
plant operator.  Bulk plant operators, however, may also supply a number
                               III.l

-------
                               FIGURE  111.1

                     GASOLINE DISTRIBUTION NETWORK
                                   Refinery
                                     I
           Automobiles,
              Trucks
Marine
Terminal

Pipeline
Terminal
it * i
                                                  Commercial and
                                                  Rural Accounts
o
Storage

Transfer

More Common Path
Less Common Path
                                                        Automobiles, Trucks,
                                                          Farm Machinery
                                     III.2

-------
of high volume accounts.  Deliveries to these  customers  are  made  by
truck transports directly from the bulk terminal,  thereby bypassing
storage at the bulk plant because of the costs associated with  product
handling.  Only about 20% of the total  U.S. gasoline throughput
actually moves through bulk plant storage.   This  figure  is expected
to decline as increasing volumes of gasoline move  directly from bulk
terminals to retail outlets and end-users thus avoiding  bulk plant
storage.

2.   Historical Market Environment
     Bulk plants have experienced the same historical  market conditions
as bulk terminals and are subject to the same  "stand alone"  econo-
mics and rationalization process.  A substantial  number of bulk plants
have already closed because of their poor profitability, and more
closures are expected.  However, some rural and semi-rural bulk plants
will be more secure than their urban counterparts  because their opera-
tions, and hence profitability, are partially shielded from  competitive
market forces by transportation economics.

B.   AUDIT SUMMARY
     The following discussion of the bulk plant industry will focus  on
five of its primary characteristics:

                 •  Population
                 t  Storage Capacity
                 •  Size Distribution
                 0  Ownership, and
                 •  Employment

As in the case of the bulk terminal audit, the discussion of size dis-
tribution treats both shell storage capacity and average daily through-
put.  Additionally, regional differences or trends are identified
whenever appropriate.  Much of the information used in assembling this
audit was obtained from the national and regional  offices of the National
                               III.3

-------
011 Jobbers Council.    This data was supplemented  and  cross-checked
with government and industry reports, field interviews,  and  in-house
Arthur D. Little information in producing the final  audit results.

1.   Population
     In 1978, there were approximately 18,640 petroleum  bulk plants in
the U.S. (Table III.I) representing a 20% decline  from the 23,370
bulk plants reported  by the Department of Commerce in  1972.    These
closures have primarily been the result of adverse market conditions
characterized by shrinking margins.  Also, the withdrawal  of the
integrated oil companies from bulk plant operations removed  the
necessary financial subsidy required by marginal operations.  Further-
more, the rationalization process of many gasoline marketers has
resulted in the sale, closing or consolidation of  bulk plant operations
in certain areas.

     Of the total 1978 bulk plant population, 96%  or  17,850 bulk
plants store gasoline.   Bulk plants not storing gasoline may specialize
in distillate fuels,  lubes or specialty oils and are primarily located
in the Northeast and Midwest (Table III.2).  PADD's I  and II together
account for two-thirds of all bulk plants and two-thirds of those
storing gasoline.  Almost half, 47%, of all bulk plants  and  half, 48%,
of the gasoline bulk plants are located in PADD II where distribution
logistics and a high concentration of rural accounts warrant secondary
petroleum storage.

2.   Storage Capacity
     Storage capacity at bulk plants has been declining  as an increasinq
number of marginal facilities close.  The total storage  capacity  of all
bulk plants in 1978 was estimated at 1.8 billion gallons with gasoline
storage capacity accounting for 1.1 billion gallons, or  60%  of this
 A jobber trade association
2
 Bureau of Census, 1972 Census of Wholesale Trade
                                III.4

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TABLE III.l
PADD
I
II
III
IV
V
Total
Source:

Number of
Bulk Plants
3,510
8,850
3,320
990
1,970
18,640
Bureau of C<
Factbook, (
ALL PETROLEUM BULK
Percent
of Total
Total Capa
19%
47%
18%
5%
11%
100%
snsus,
1972-19
Thousand
Gallons
433,290
710,670
253,380
85,490
302,270
1,785,100
1972 Census
1978
PLANTS
Storage
city
Thousand
Cu. Meters
1,641
2,691
958
323
1,144
6,757
of Wholesal
78); Industry contacts;
BULK PLANT POPULATION

Percent
of
Total
24%
40%
14%
5%
17%
100%
e Trade;
Arthur D
Rll
DU
Number of
Bulk Plants
3,190
8,540
3,320
990
1,810
LK PLANTS
Percent
of
Total
18%
48%
19%
5%
10%
17,850 100% 1
National Oil Jobbers Council
. Little, Inc.
STORING G/
Gasolir
Caj
Thousand
Gallons
250,270
401 ,830
187,190
58,490
164,600
,062,380
; National
\cni TMIT
AoULiINt 	
ie Storage
>acity
Thousand
Cu. Meters
947
1,521
709
221
623
4,021
Petroleum

Percent
of
Total
24%
38%
18%
5%
15%
100%
News ,

-------
             TABLE 1 1 1. 2
NON-GASOLINE BULK PLANT DISTRIBUTION

       BY REGION AND OWNERSHIP
PADD
I
II
III
IV
V
Total
Percent
Majors &
Semi -Majors
200
170
-
-
130
500
of Total 63%
Jobbers
120
140
-
-
30
290
37%
Total
 320
 310
160


790


100%
                                                Percent
                                                of Total
                                                  41%


                                                  39%
                                                  20%
                                                 100%
                                  ™.  Associations;  Industry

-------
 total.   Gasoline  storage has been declining not only because of the
 number of  bulk  plant closures, but also because of the increasing amount
.gasoline throughput which is bypassing bulk plant storage and being
 delivered  directly to  service stations and end users. Because most of
 the  bulk plant  population is located in PADD's I and II, almost two-
 thirds of  the total storage capacity, 64%, and gasoline capacity, 62%,
 is located in these two regions with PADD II accounting for 40% and
 38%,  respectively.

 3.    Size  Distributions
      a.  Storage  Capacity
      Because  bulk plant economics and operations are based upon a
 large number  of annual tank turnovers, most facilities tend to be
 small.   Over  90%  of both petroleum and gasoline bulk plants have
 total storage capacities less than 150,000 gallons.  Of this number,
 79%  are  between 40,000 and 150,000 gallons (Table III.3).  A more
 detailed presentation  of bulk plant  storage capacity appears in Appen-
 dix  A.

      b.  Average  Daily Throughput
      Bulk  plant operators will avoid storing petroleum products at
 bulk plants whenever possible.  This will continue  to exert downward
 pressure on all average product throughputs at bulk plants, aasoline
 in  particular.  Over 80% of all bulk plants have an average daily
 product  throughput that is less than 8,000 gallons  (Table  III.4).
 Similarly, over 90% of the gasoline  bulk  plants  have an average daily
 gasoline throughput less than 8,000  gallons.  Most bulk plants have
 product  or gasoline throughputs that are  between 3,000 and 8,000
 gallons/day.

 4.    Ownership
      Jobbers  own the  greatest number of  bulk plants with  74% of all
  A jobber is a petroleum distributor who  purchases  product  from a refiner
  or terminal operator for the purpose of  reselling  to  retail outlets,
  commercial  accounts or reselling through his  own retail  outlets.
                                III.7

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                                                      TABLE 111.3
                                            BULK PLANT STORAGE DISTRIBUTION
                           Total  Storage
                             Capacity
                        Thousand
                        Gallons

                         <40
Cubic
Meters

 <150
                 ALL PETROLEUM
             	  BULK PLANTS 	

              Number of    Percent
             Bulk Plants   of Total
 2,380
13%
                              BULK PLANTS
                        — STORING GASOLINE —
                          Number of    Percent
                         Bulk Plants    of Total
 2,380
13%
CO
                        40-150
150-570
14,800
79%
14,100
                                                                                            79%
                        150-300
570-1,140
 1,180
 6%
 1,100
                                                                                             6%
                        >300
                  280
               2%
                260
               2%
                        Total
               18,640
             100%
             17,850
                                                                                           100%
                        Source: Bureau of Census, 1972 Census of Wholesale Trade; National Oil Jobbers
                               Council; National Petroleum News, Factbook (1972-1978); Industry
                               contacts; Arthur D. Little, Inc.

-------
                                  TABLE III.4
fll 1 PFTRni FIIM
_ .___ — 	 _ flLL rt.IKULt.Un
Average Product
Throughput
Thousand Cubic
Gallons/Day Meters/Day
<3 <10
3-8 10-30
8-17 30-65
>17 >65
Total
BULK
PHI |/ p| AMTC
DULIv r Lnli 1 J
Number of
Plants

4,400
10,760
2,650
830
18,640
PLANT THROUGHPUT DISTRIBUTION

Percent
of Total

24%
58%
14%
4%
100%
Source: Bureau of Census, 1972 Census of Wholesale
RIM Y PI ANT^ ^TORT
Average Gasoline
Throughput
Thousand Cubic
Gallons/Day Meters/Day
~<3 <10
3-8 10-30
8-17 30-65
>17 >65
Total
Trade; National Oil Jobbers
NG GASOLINE
Number of
Plants

5,210
11,210
1,170
260
17,850

Percent
of Total

29%
63%
1%
1%
100%
Council ; National
Petroleum News,  Factbook,  (1972-1978);  Industry contacts;  Arthur  D.  Little,  Inc.

-------
bulk plants and 76% of all  gasoline bulk  plants  (Table  III.5). The majors
own almost a quarter, 22%,  of all  bulk plants  and a  fifth of the  gasoline
bulk plants, while the independent marketers/wholesalers own less than
5% of either type. The jobbers'  share of  the market  has been increasing
steadily in recent years as the  majors have pulled out of secondary
storage operations as part  of their overall marketing strategy.   Jobbers
also tend to own a proportionately greater number of small gasoline
bulk plants, and proportionately fewer large bulk plants than either  the
majors or the independent marketers/wholesalers.  Jobbers, who own 76%
of all gasoline bulk plants, own over 82% of the smallest bulk plants having
less than 40,000 gallons of storage capacity,  but only  36% of the largest
bulk plants having storage  greater than 300,000  gallons  (Table III.6).
By contrast, the majors, who own 20% of the gasoline bulk plants, own over
75% of the largest facilities, but only 18% of the smallest bulk  plants.

5.   Employment
     Bulk plant employment  fell  from 105,520 reported by the Department
of Commerce in 1972 to an estimated 75,010 in  1978,  a decline of  29%
(Table III.7).  The employment level at gasoline bulk plants was
estimated at 72,130 or 96%  of the total bulk plant employment.  Because
most of the bulk plants are located in PADD's  I  and  II, almost three-
quarters of the employment  is also located in  these  two regions.

C.   BULK PLANT TRENDS
1.   New Construction
     Because gasoline demand is  not expected to  increase substantially
from present levels and because  more gasoline  volume will bypass  storage
at bulk plants, no new bulk plants or gasoline storage  are expected to
be built.

2.   Existing Bulk Plants
     Additional bulk plant  closures are expected because of increasing
market competition and the  ongoing rationalization process of petroleum
marketers which will continue to favor the larger, mere efficient bulk
                               III.10

-------
                                      TABLE  III.5
                               1978 BULK PLANT OWNERSHIP
Ownership Segment
                                ALL PETROLEUM
                                 BULK PLANTS
 Number of      Percent
Bulk Plants     of Total
                        BULK PLANTS
                 	 STORING GASOLINE 	

                  Number of      Percent
                 Bulk Plants     of Total
Majors & Semi-Majors
   4,110
 22%
 3,610
 20%
Independent Marketers/
  Wholesalers
     770
  4%
   770
Jobbers
  13,760
 74%
13.470
 76%
Total
  18,640
100%
17,850
100%
Source: National  Oil  Jobbers Council; National  Petroleum News,  Factbook  (1972-1978);
        Industry contacts; Arthur D.  Little,  Inc.

-------
                                                       TABLE III.6
INJ
GASOLINE
BULK PLANT DISTRIBUTION BY SIZE AND OWNERSHIP
ncnrcwT nc DIII v DI AMTC CTODIMP rncni TMC
Total Storage
Capacity
Thousand Cubic
Gallons Meters
<40 <150
40-150 150-570
150-300 570-1,140
>300 >1,140
Percent of Total
Total Number of
Bulk Plants Storing
Gasoline
Source: Bureau of Census
	 r L.lvVsL.11 I \J\ uui-is i unit i o UIUIMMU unjuL. xiii-
MajOrS Independent Total Number
& Semi- Marketers/ Percent of Bulk Plants
Majors Wholesalers Jobbers of Total Storing Gasoline
2.0
16.2
1.2
0.8
20.2
3,610
, 1972
0.4 11.0 13.4 2,380
3.5 59.3 79.0 14,100
0.3 4.7 6.2 1,110
0.1 0.5 1.4 260
4.3 75.5 100.0
770 13,470 17,850
Census of Wholesale Trade; National Oil Jobbers Council; Natioi
                    Petroleum News, Factbook (1972-1978); Industry contacts; Arthur D. Little, Inc.

-------
                                                        TABLE  III.7
CO
1978 BULK PLANT EMPLOYMENT
PADD
I
II
III
-IV
V
Total
Source:
ALL PETROLEUM
Rill K PI ANT*;
Percent
Empl oyment of Total
24,210 32%
31 ,220 42%
9,780 13%
3,520 5%
6,280 8%
75,010 100%
Bureau of Census, 1972 Census of Wholesale
Council; National Petroleum News, Factbook
BULK
fTnpTwr
	 • ;> 1 UK1JNI
Employment
22,850
30,180
9,780
3,520
5,800
72,130
Trade; National
PLANTS
> pAcni TMC
i bAoULlINt 	
Percent
of Total
32%
42%
13%
5%
8%
100%
Oil Jobbers
(1972-1978); Industry contact
                              Arthur D.  Little, Inc.

-------
plant operations.   Based upon industry discussions  with majors,  indepen-
dents and jobbers, an estimated 3,480 gasoline bulk plants are expected
to close or be consolidated over the next 5 years,  thereby reducing the
bulk plant population to about 15,100 (Figure III.2).   This decrease
represents an average annual reduction in the bulk  plant population of
4.2%, which is greater than the 1972-1978 average rate of decline of 3.7%.
The increase in the rate of closures results from a more accelerated
exodus from the bulk plant industry on the part of  the majors and inde-
pendents.  The average annual decline in existing jobber operations was
assumed to be only 2.5% in the above calculation.  All 3,480 closures are
expected to be bulk plants having less than 8,000 gallons of average
daily gasoline throughput.

      The ongoing shift of bulk plant ownership will continue to be a
major consideration within the industry.  Major oil companies are expected
to continue to withdraw from bulk plant operations  in most markets by
attempting to sell their facilities.  Between 1978  and 1983, 1,540 bulk
plants are expected to be offered for sale by the majors with most of
these facilities,  i.e. 75%, being purchased by jobbers who will  consoli-
date them with their existing operations (Table III.8).  Some attrition,
i.e. 25%, however, is expected to result from this  ownership transfer
as market conditions preclude total absorption of these facilities by
the jobber network.

      As bulk plants close, their gasoline throughput will be redistributed
 among other facilities.  By 1983, the average annual  gasoline throughput
 of the remaining bulk terminal population could increase by as  much as
 1,000 gallons/day.  However, the actual incremental throughput  will
 most likely be less than this figure for the following three reasons.
 First, overall gasoline demand is expected to decline from its  current
 levels.  Second, an increasing portion of bulk plants' gasoline sales
 will be delivered directly  from the bulk terminal, thereby bypassing
 actual storage at the bulk  plant.  Third, the expanding marketinq sphere
                               III.14

-------
25,000
               23,300
20,000
                                18,640
15,000
                                                 15,100
10,000
 5,000
                1972
1978
1983
                   FIGURE 111.2   ESTIMATED 1983 BULK PLANT
                                POPULATION BEFORE VAPOR
                                CONTROL IMPACTS
                             ITT

-------
                                 TABLE 111.8


                          MARKET RATIONALIZATION OF

                       GASOLINE BULK PLANTS, 1978-1983
                              Majors
                              & Semi-
                              Majors
            Independent
             Marketers/
            Wholesalers
               Jobbers
            Total
1978 Bulk Plant
 Population
 3,610
 770
13,470     17,850
Ownership Transfer
(1,150)
                 1,150
Closures Due To Market
 Rationalization
(   390)
(170)
(2,920)    (3,480)
1983 Bulk Plant
 Population (Pre-Vapor
 Control)
 2,070
 600
11,700     14,370
Percent Decline
 1978-1983
 42.7%
22.1%
 13.2%
19.5%
Source: Bureau of Census, 1972 Census of Wholesale Trade;  National  Oil  Jobbers
        Council; National Petroleum News, Factbook, (1972-1978);  Industry  contacts;
        Arthur D. Little, Inc.

-------
of bulk terminals will increase the competition between terminals  and
bulk plants and, through greater efficiencies and economies  of scale,
capture a portion of the bulk plants' existing  gasoline throughput.
                                III.17

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            IV.   VAPOR CONTROL STRATEGIES AND SYSTEM COSTS

A.  INTRODUCTION
     Gasoline vapors containing benzene and other hydrocarbons  routinely
escape into the atmosphere during normal bulk storage operations,  e.g.,
whenever gasoline storage tanks are filled or delivery vehicles are
loaded.  The U.S. Environmental Protection Agency has defined three
control strategies or options which would reduce the amount of benzene
released into the atmosphere by controlling the resulting hydrocarbon
vapors whenever gasoline is moved into or out of bulk storage.   The
darkened lines of Figure IV-1 indicate those segments of the gasoline
distribution network addressed in this study by the three vapor control
options.  The EPA has requested that Arthur D. Little evaluate the eco-
nomic impact of each option and has provided us with  cost data for model
vapor control systems, representing various technologies, which would
comply with the proposed vapor control regulations.  A discussion of
each of the control options, as well as the costs of the model  vapor
control systems, is presented in this chapter.

B.  VAPOR CONTROL OPTIONS
     Before discussing the specific options to control gasoline vapor
emissions at bulk storage facilities, it  is first necessary to define
an operational base case for the bulk storage industry.  Then, each of
the three control options, which will be  measured relative to  this base
case, will  be discussed.

1.  Base Case
     a.  Bulk Terminals
     In the  base case, bulk  terminals, which have not already installed
vapor control systems required by the three control options, are assumed
to load transports  using the top-loading, submerged fill method.  With
this method, the loading arm of the gasoline rack enters the tank com-
partment and extends to within 6 inches of the  bottom of the tank
 (Figure IV.2).  This method  reduces the amount of vapors that might  form
                                  IV.1

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                                 FIGURE IV.1

                      GASOLINE DISTRIBUTION NETWORK
                                   Refinery
                                      1
           Automobiles,
              Trucks
         Segnents Addressed
         in  This Study
                                                     Commercial and
                                                      Rural Accounts
o
J  Storage

   Transfer

   More Common Path
   Less Common Path
                                                        Automobiles, Trucks,
                                                          Farm Machinery
                                    IV.2

-------
Vapor Emissions
                 Gasoline
                  Vapors^
Vapors
                               •*	 Fill Pipe

                                            Hatch Cover
                          Gasoline
        Product
                                         Tank Truck Compartment
      A. Top Splash Loading Method
Vapor Emissions v
Vapor," ./
Product " ^.
^— — Gasoline /
•^ 	 nil


Ta
                                             Hatch Cover
                                          Tank Truck Compartment
        B. Top Submerged Method
        Vapor Vent to
        Recovery Equipment
        or to Atmosphere    Hatch Closed
         V
                             Vapors
      Product
    C. Bottom Loading Method

                                Tank Truck Compartment


                                   Gasoline

                               -  Fill Pipe
    FIGURE IV.2  GASOLINE TANK TRUCK LOADING METHODS
                              IV.3

-------
within the tank compartment during the loading operation by reducing the
turbulence of the gasoline as it  fills the compartment.  However,  because
the fill pipe entering the tank has a smaller diameter than the opening
of the hatch cover, the space surrounding the fill  pipe will  still  per-
mit gasoline vapors to escape into the atmosphere as the liquid level
rises.  No control of these escaping vapors has been assumed in the base
case.  Approximately 1,980 metric tons of benzene would be released into
the air annually by the bulk terminal industry if all  terminals used
this method of loading (Table IV.I).

     b.  Bulk Plants
     Filling storage tanks accounts for over 30% of the annual  benzene
emissions at bulk plants.  When a truck transport delivers gasoline to a
bulk plant, gasoline is usually pumped into the storage tank through a
pipe at the bottom of the tank.  As the gasoline level in the storage
tank rises, gasoline-saturated vapors are displaced and vented through a
pressure-relief valve on the top of the tank.  No control of these
filling losses is assumed in the base case.

     Almost 40% of total benzene emissions at bulk plants occurs during
truck loading.  In the base case, tank wagons are assumed to be loaded
using the splash fill method.  Splash fill, as its name implies, allows
the gasoline to fall from the top of the tank compartment (Figure IV.2).
This method of loading is considerably more turbulent than the submerged
fill method and, hence, allows more gasoline vapors to form and subse-
quently escape.  These vapors will be forced through the space between
the hatch opening of the truck and the fill pipe of the loading rack by
the rising gasoline level in the tank compartment.  Storage tank filling
and tank wagon loading together account for over 70% of the benzene
emissions originating at bulk plants in the base case.

     The remaining 30% of the benzene emissions results from storage
tank emptying and breathing.  As the gasoline storage tanks are emptied,
the partial vacuum created within the tank draws in fresh air through
the pressure-relief valve.  The fresh air becomes saturated with gasoline
                                 IV.4

-------
                                      TABLE  IV.I
BASE CASE EMISSIONS AT BULK STORAGE FACILITIES
Source
Bulk Terminal
- Loading Trucks
(top submerged)
Bulk Plant
-
Tank Breathing
Tank Emptying
Tank Filling
Annual National
Hydrocarbon Benzene Gasoline Benzene
Emissions Emissions Throughput Emissions
(mg/1) (mg/1)
600 4.8
600 4.8
460 3.7
1150 9.2
(1/yr) (metric tons/yr)
413 x 109 1980
792
165 x 109 607
1518
- Truck Loading
  (splash fill)
1400
11.2
165 x 10-
1848
Total
                                                 6745
Source: U.S.  Environmental  Protection Agency

-------
vapors and expands, thus forcing a portion of the gasoline-saturated air
back into the atmosphere through the pressure-relief valve.   Similarly,
breathing losses occur because temperature changes  within  the tank,
cause the gasoline vapor to expand and to contract.  As  the  tank  is
warmed, the gasoline vapor expands and a portion is vented through the
pressure-relief valve.  As the tank cools, the gasoline  vapor within
the tank contracts and draws in fresh air, which will  eventually  become
saturated with gasoline vapors.  In addition to ambient  temperature,
breathing losses are affected by a number of factors, including the
color and the condition of the storage tanks.

2.  Option 1
     Option 1 provides the least amount of benzene  reduction of the  three
control options.  This option only reduces the benzene emissions  by
about 64% from the base case level.  Under this option,  all  terminals
must install control systems to collect and dispose of gasoline vapors
resulting from truck transport loading.  Truck transports  delivering
gasoline would also have to be equipped to handle vapor  control.   These
systems may either capture and reliquify gasoline vapors,  returning
the liquid to the storage tanks, or oxidize the collected  vapors.
Examples of vapor control systems which reliquify gasoline vapors
include refrigeration (RF), compression-refrigeration-absorption  (CRA),
and adsorption-absorption (AA).  An incineration system  (OX) will  oxidize
the collected vapors.  All of these technologies are currently in  use by
the bulk storage industry, although the refrigeration system is the  most
common.  These systems are considered to be the most effective vapor
control methods at bulk terminals, capable of reducing benzene emissions
by 95%.

     Bulk plants would be required to stop splash loading  tank wagons
and to balance storage tanks to incoming truck transports  during
storage tank loading.  Operators would now have to  use either a top-
loading or bottom-loading submerged fill method when loading their tank
wagons (Figure IV.2).  Most bulk plants now employing splash fill  will
                                 IV.6

-------
most likely switch to the top-loading, submerged fill method because its
conversion costs are significantly less than the conversion costs asso-
ciated with a bottom-loading system.  Vapors displaced from the storage
tanks by the rising liquid level during tank filling would no longer be
allowed to escape into the air.  These vapors would be captured at the
pressure-relief valve and "balanced" or sent to the truck transport
making the gasoline delivery.   Vapors would then accumulate
in the emptying tank compartments of the truck and be returned by the
transport to the bulk terminal for eventual collection and disposal
during the transport's next loading (Figure IV.3).   Accounts serviced
by bulk plants would be exempted from vapor balancing as the tank wagons
would not be equipped to handle those vapors.  However, retail  accounts
would be required to install submerged fill systems for their storage
tanks.

3.   Option 2
     Option 2 is a more effective control strategy than Option 1, with
a level of benzene emission  that is 82% lower than the base case
(Table IV.2).  Bulk terminals would be required to employ the same
degree of vapor control under this option as in Option 1, i.e.,  refrige-
ration, compression-refrigeration-absorption, adsorption-absorption,
oxidation or the equivalent.  Benzene emissions from  bulk terminals in
this option would also be the same as in Option 1.
     Bulk plants would still load their tank wagons using a submerged
fill method.  However, they would also be  required to install a  balance sys-
tem on all tank wagons in addition to the balance system on storage tanks
required by Upfion 1. Tank wagons would then be modified in order to
receive gasoline vapors while filling tanks at retail outlets and to
transport these vapors back  to  the  bulk plant.  During subsequent tank
wagon loading, the gasoline  vapors, which would have  escaped through the
hatch opening in Option 1, will now be collected and  sent to the empty-
 ing  storage  tank  (Figure  IV.4). These vapors,  which  are  "balanced  to storage,"
will  eventually be  "balanced to transport" during  the next  transport
 delivery  and  be returned  to the bulk  terminal  for  ultimate  disposal. With
                                  IV.7

-------
     BALANCE TO TRANSPORT
              Vapor Line
                                                Vapor
                                               Gasoline
                                               Storage
                                                Tank
Truck Transport Unloading
                            Gasoline Line
        FIGURE I V.3  VAPOR BALANCED TO TRUCK TRANSPORT
                     DURING STORAGE TANK LOADING
                                IV.8

-------
                                       TABLE IV.2
NATIONAL

Source
Bulk Terminal
- Loading Trucks
Bulk Plants
- Tank Breathing
- Tank Emptying
- Tank Filling
- Truck Loading
Total
BENZENE EMISSIONS
(Metric
Base Case

1980

792
607
1518
1848
6745
UNDER VAPOR
tons/year)
rnMTRr
Option 1

100

792
607
152
792
2443
CONTROL OPTIONS

Option 2

100

792
0
152
185
1229


Option 3

100

792
60
152
185
576
 Percent  Reduction  from
  Base Case                                     64%             82%              91%
Source: U.S. Environmental  Protection Agency

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            BALANCE TO TRANSPORT

-------
a full  balance system, bulk plant benzene emissions  are reduced by  almost
50% over Option 1.  This decline occurs not only because gasoline vapor
emissions during tank wagon loading are substantially reduced,  but  also
because the emptying storage tank is now being filled with gasoline-
saturated vapor instead of fresh air drawn in through the pressure-relief
valve.

4.    Option 3
      Option 3 provides the greatest reduction in benzene emissions of
the three control options with an annual benzene level 91% below the
base case.  Again, the control requirements and the benzene levels  at
bulk terminals are exactly the same as they were in Option 1.   Bulk plants,
however, would not be required to install vapor collection and  disposal
systems similar to those required at bulk terminals, e.g. refrigeration,
compression-refrigeration-absorption, adsorption-absorption, oxidation
or the equivalent.  These control systems would be of a smaller scale
than those at terminals, but all vapors would be collected and  disposed
of on-site.  No vapors would be "balanced to transport" and returned to
the bulk terminal.  All retail outlets serviced by bulk plants  would be
required to install vapor balance systems.  A brief summary of  the  base
case assumptions and the proposed vapor control regulations is  presented
in Table IV.3.

5.    Stand-By Systems
      It is the intention of the EPA that no gasoline loading be performed
at bulk terminals or bulk plants if the continuous and efficient operation
of the vapor control systems cannot be assured.  A bulk storage facility
would have three alternatives should its vapor control system become
temporarily inoperative:

      •  switch to a stand-by system,
      t  utilize a gasoline vapor holder to collect vapors until
         the control system is operational, or
      t  shut down gasoline loading operations until the control
         system is operational.
                                  IV.11

-------
                                                        TABLE  IV.3
                                 VAPOR  CONTROL  OPTIONS AT GASOLINE BULK STORAGE FACILITIES
ro
Source
Terminals
Filling Truck Transports
At The Loading Rack
Bulk Plants
Filling Gasoline
Storage Tanks
Filling Tank Wagons
At The Loading Rack
Base Case3
Top
Submerged
Fill
Bottom Fill
Splash Fill
	 tUNIKUL i
Option lb
Vapor
Recovery or
Incineration
Balance
to Transport
Submerged
Fill
.ctNARIO 	 —
Option 2C
Vapor
Recovery or
Incineration
Balance
to Transport
Balance
to Storage
Option 3C
Vapor
Recovery or
Incineration
Vapor
Recovery or
Incineration
Vapor
Recovery or
                                                                                               Incineration
 Most common  current  industry practice.



 Vapors from  all  gasoline  stations supplied from terminals will be  balanced
 T*V*4mr»r\s*u«4-    !/_•«.*.».._ £._ _ __,      -| •     ,  , •        _ .   .              • »•  "w »* i ** i i w v» w
                    trom aasonne station*; sunniioH from bulk plants will
CVapors from all gasoline  stations  will  be balanced to the supplying vehicles
 station tanks will be loaded  via submerged fill.                   9 venicles


Source:  U.S. Environmental  Protection Agency
                                                                                               to the truck

                                                                                                 be balanced
                                                                                                   Service
                                                                                                   ^ervice

-------
These alternatives will  not significantly affect  the vapor balance
systems since they are not as susceptible to mechanical  failure  as  the
collection and disposal  systems, e.g.,  refrigeration, CRA,  incineration,
etc.

      The EPA has provided Arthur D.  Little with  cost data  for the  first
two alternatives shown above.  Based on estimated capital  requirements,
a stand-by system was selected as the less expensive alternative that
would assure that gasoline vapors were continuously controlled.   The
stand-by system selected for use in both terminals and bulk  plants  was
the incineration system.  This stand-by system had the least capital
requirement of any of the technologies evaluated.  Because both  the
decision to shut down gasoline loading operations and the costs  incurred
from such a decision would vary considerably from one installation  to
another, evaluating this alternative was considered to be outside the
scope of this study.  It may, however, be a viable alternative for  some
facilities having very small gasoline throughputs.

C.  VAPOR CONTROL SYSTEM COSTS
1.  Bulk Terminals
     Because the level of vapor control at terminals is the same for each
of the three options discussed in the previous section, the EPA provided
Arthur D. Little with one set of costs for the various primary control
systems currently available to terminal operations.  Cost information
was also provided for an incineration stand-by system should such a
system be required.  This cost data was prepared for two bulk terminal
models:  250,000 gallons/day and 500,000 gallons/day of gasoline
throughput.

     Representative costs of primary control systems, i.e., no stand-by
system, are shown in Table IV.4.  Installed capital costs range from
$144,000 for an incineration unit in a terminal having 250,000 gallons
of daily gasoline throughput to $328,000 for a CRA unit in a terminal
having 500,000 gallons of throughput.  All of the capital costs presented
in this report exclude the cost of monitoring equipment which has been
                                 IV.13

-------
                                                                         TABLE IV.4
                                      ESTIMATED 1978 CONTROL.COSTS FOR PRIMARY VAPOR CONTROL SYSTEMS AT MODEL TERMINALS

Gasoline Loading Rate:
Vapor Control System;
Installed Capital Cost
Annual Operating Costs
Electricity
Propane (Pilot)
Maintenance
Operating Labor
Carbon Replacement
Taxes, Insurance, G & A
TOTAL OPERATING COSTS
GASOLINE RECOVERY CREDIT


ADSORPTION/
ABSORPTION
240.0

3.9
'
4.8
1.5
2.4
9.6
22.2
*39.2

230,000
COMPRESSION/
REFRIGERATION
ABSORPTION >
256.0

5.1
--
5.1
1.5
--
10.2
21.9
39.2
(Thousand Dollars)
Gal Ions /Day
INCINERATION REFRIGERATION
144.0 204.0

2.9 9.9
1.0
2.9 6.1
1.5 1.5
..
5.8 8.2
14.1 25.7
39.2


ADSORPTION/
ABSORPTION
310.0

7.8
—
6.2
1.5
4.7
12.4
32.6
78.4

500,000 Gallons/Day
COMPRESSION/
REFRIGERATION
ABSORPTION INCINERATION
328.0 190.0

8.3 5.8
1.0
6.6 3.8
1.5 1.5
..
13.1 7.6
29.5 19.7
78.4


RE FRIGE RAT I
306.0

19.8
--
9.2
1.5
--
12.2
42.7
78.4
Source:  U. S. Environmental Protection Agency

-------
estimated at an additional  $20,000.   Operating  costs  are  least expensive
for the incineration systems and most expensive for the refrigeration
systems.   The gasoline recovery credit shown  in Table IV.4  and in sub-
sequent tables is the value to the terminal or  bulk plant operator of
the recovered gasoline volumes that would have  otherwise  been lost into
the atmosphere.  These credits were calculated  by the EPA using  $.40 per
gallon times the terminal's annual throughput assuming that 100% of the
available gasoline vapor is collected at the  loading  rack.   All  of the
recovery system, i.e., refrigeration, CRA and adsorption-absorption, have
been assumed to be equally efficient and, hence, realize  the same recovery
credit.  Because the refrigeration and incineration  units have the least
capital cost and are the most common control  systems  in operation today,
they were selected for use in our analysis, I.e., to  determine the number
of potential bulk terminal  closures and the costs of  nationwide  compliance.

     The costs of an incineration stand-by unit and  the  costs of combined
primary/stand-by systems, e.g., refrigeration/incineration  and incinera-
tion/incineration, are shown in Table IV.5.  The total capital cost of
these systems ranges from $239,000 for a 250,000 gallon/day incineration/
incineration system to $436,000 for a 500,000 gallon/day  refrigeration/
incineration system.  Operating costs of these  dual  systems are  the  sum
of the operating expenses of the primary and the stand-by units. The
gasoline recovery credit for the refrigeration/incineration system  is
5% less than the recovery credit of the single  refrigeration unit
because of losses resulting from system testing and  the  periodic over-
haul of the combined control unit.  Refrigeration and incineration
systems with incineration stand-by were also selected for the closure
and cost analysis.  Additional cost data and assumptions  used in calcu-
lating the model control system costs are presented in Appendix  D.
                                  IV.15

-------
                                                                                    TABLE IV.5
C7>
' 	 — — 	 . 	 , — -•- -• IIIIWH bwiiiuuL JIJILH HJ PUUCL ItKHlNALb
(Thousand Dollars)
Gasoline Loading Rate:
Installed Capital Cost
Annual Operating Costs
Utility
Maintenance, Labor & Materials
Taxes, Insurance, G & A
250.000 Gallons/Day
STAND-BY REFRIGERATION/
INCINERATION INCINERATION
95.0 299.0

9.9
2.9 10.5
3.8 12.0

INCINERATION/
INCINERATION
239.0

3.9
7.3
9.6
500,000 Gallons/Day
STAND-BY REFRIGERATION/
INCINERATION INCINERATION
126.0 436.0

17.8
3.8 16.2
5.0 17.4

INCINERATION/
INCINERATION
316.0

6.8
9.1
12.6
       TOTAL OPERATING COSTS
                                                   6.7
                                                                       32.4
                                                                                        20.8
                                                                                                                8.8
                                                                                                                                  51.4
                                                                                                                                                   28.5
       GASOLINE RECOVERY CREDIT
                                                                       37.2
                                                                                                                                  74.5
       Source:  U.S.  Environmental Protection Agency

-------
2.  Conversion of the Truck Transport Fleet
     The cost of modifying the truck transport fleet is  not  included  in
the bulk terminal costs discussed above.   These expenses will  be  incurred
by common carriers and terminal  operators who own  almost all  of the gaso-
line transports.  The EPA has estimated that the installed capital cost
of the vapor control  equipment for a four-compartment tank trailer to be
$2,100, if retrofitting, and $1,900, if ordering vapor control equipment
on a new trailer (Table IV.6).  These costs include co-axial  elbows and
hoses, vents and gaskets.  Annual maintenance and miscellaneous operating
expenses are estimated to total  $350.

3.  Bulk Plants
     The EPA has compiled control system costs for each of the three  control
options discussed above.  Vapor control syste:m costs were calculated
for two bulk plant models:  4,000 gallons/day and 20,000 gallons/day
of gasoline throughput.  However, for each control option and bulk plant
model, there are three distinct and possible control systems:
       •  NOJC  - the most expensive control system described by
               McCormack and Schuster of the California Independent
               Oil Marketers Association.
       •  Houston-Galveston - a top-loading version of the Wiggins
               System.
       •  Colorado APCD - the least expensive control system
               reported by the Colorado Air Pollution Control
               Division (APCD).
The EPA has assumed that all of the above systems are equally efficient
in controlling gasoline vapors for each one of the three control  options.

      For the purpose of our analysis, it was assumed that bulk plant
operators would choose a top-loading system in order to comply with the
three  vapor control options.  The top-loading method was selected
because it is generally a less expensive modification than a conversion
to bottom-loading.  Some bulk plants, however, may choose a  bottom-
loading system for reasons of efficiency and safety.  However, because
  National Oil Jobbers Council, a jobber trade association.
                                  IV.17

-------
CO
                                                       TABLE IV. 6

                                              ESTIMATED 1978 COST OF VAPOR
                                            CONTROL IN GASOLINE  TANK TRAILERS
                                                          ,            - * — .
                                             (Thousand Dollars Per Trailer )
                                                                     Retrof 1 t           New
                                                                      Market            Market
                 Installed Capital  Cost                                2.10              1.90

                 Annual  Operating  Costs
                    Maintenance  &  Labor                                0.27              0  27
                    Taxes, Insurance,  G &  A                             0.08              0.08
                 Assuming  four  compartments  per trailer
                 Source: U.S.  Environmental Protection Agency
                 Total  Operating  Costs                                 0.35             0.35

-------
the bulk plants that might decide upon a bottom-loading  system would  be
facilities in a stronger financial  position relative to  the  rest of the
industry, their decision to go with a bottom-loading system  would not
significantly affect the results of our closure  analysis.

     The costs of the three control systems, i.e., NOJC, Houston-
Gal veston, and Colorado APCD, for each of the three control  options
are presented in Tables IV.7 through IV.12.  Estimated capital costs
for Option 1  range from $2,000 to $4,000 (Table  IV.7).  The  capital
requirement necessary to comply with Option 2 regulations is $24,000
for the NOJC system, six times the capital requirement of the Colorado
APCD system to achieve the same level of vapor control (Table IV.8).
Four alternative system configurations are presented for Option  3.
The costs for the primary refrigeration and incineration units are
shown in Tables IV.9 and IV.10, respectively.  Because neither of
these includes a stand-by unit, costs were also calculated for a
refrigeration/incineration system and an incineration/incineration
system  (Tables IV. 11 and IV.12).   Installed capital costs required
to comply with Option 3's vapor regulations range  from $30,000 for a
primary unit to over $120,000 for  a  primary/stand-by  system.
                                IV.19

-------
ro
o
                                                       TABLE IV.7


                                                        OPTION 1


                                 ESTIMATED 1978 COSTS  TO INSTALL  A VAPOR BALANCE SYSTEM

                                     AT BULK PLANTS  FOR INCOMING  TRUCK TRANSPORTS'
Daily Gasoline
Throughput:
Installed Capital Cost
Annual Operating Cost
Labor
Utilities
Maintenance
Taxes, Insurance, G&A
Total Operating Cost
Gasoline Recovery Credit

NOJC
4,000
Gal /Day
4.25
0.13
0.17
0.30
0.51
(Thousand
r
COSTS
20,000
Gal /Day
4.25
0.13
0.17
0.30
2.59
Dollars)
0 S T SC€
HOUSTON-GAL
COSTS
4,000
Gal /Day
4.25
0.13
0.17
0.30
0.51
Nfl R T n -
n n 1 U
VESTON
20,000
Gal /Day
4.25
0.13
0.17
0.30
2.59

COLORADO
COSTS
4,000
Gal /Day
1.70
0.05
0.07
0.12
0.51

APCD
20 ,000
Gal /Day
1.70
0.05
0.07
0.12
2.59
         1
          Assumes  top  submerged  loading  of  tank wagons  at  bulk  plants,
         Source:  U.S.  Environmental  Protection  Agency

-------
 Daily Gasoline
  Throughput:

 Installed  Capital  Cost

 Annual  Operating Cost
    Labor
    Utilities
    Maintenance
    Taxes,  Insurance, G&A
 Total Operating Cost

 Gasoline Recovery Credit
TABLE IV. 8
OPTION 2
ESTIMATED 1978 COSTS TO INSTALL A VAPOR BALANCE SYSTEM
AT BULK PLANTS FOR INCOMING AND OUTGOING TRUCKS!

NOJC
4,000
Gal /Day
23.03
0.69
0.92
1.61
(Thousan
COSTS
20 ,000
Gal /Day
25.73
0.77
1.03
1.80
id Dollars)
COST SCENARIO
HOUSTON-GALVESTON
COSTS
4,000 20,000
Gal /Day Gal /Day
10.70 12.98
0.32 0.39
0.43 0.52
0.75 0.91

I 	 — 	 	 . 	
COLORADO
COSTS
4,000
Gal /Day
3.84
0.12
0.15
0.27

APCD
20 ,000
Gal /Day
4.88
0.15
0.20
0.35
0.81
4.08
                                                       0.81
                                     4.08
                                      0.81
                                                                                            4.08
 Assumes top sumberged loading of tank wagons at bulk plants
Source:  U.S.  Environmental  Protection Agency

-------
ro
ro
Daily Gasoline
 Throughput:

Installed Capital Cost

Annual Operating Cost
   Labor
   Utilities
   Maintenance
   Taxes, Insurance, G&A
Total Operating Cost

Gasoline Recovery Credit

TABLE
IV. 9



OPTION 3
ESTIMATED 1978 COSTS TO INSTALL A SINGLE PRIMARY
VAPOR REFRIGERATION SYSTEM AT BULK PLANTS'!

NOJC
4,000
Gal /Day
92.18
1.43
2.17
3.28
3.69
10.57
(Thousand
COSTS
20,000
Gal /Day
94.88
1.43
2.17
3.36
3.80
10.76
Dollars)
0 S T S C E
HOUSTON -GAL
COSTS
4,000
Gal /Day
79.85
1.43
2.17
2.91
3.19
9.70
N A R I 0 -
VESTON
20 ,000
Gal /Day
82.13
1.43
2.17
2.98
3.29
9.87

COLORADO
COSTS
4,000
Gal /Day
72.99
1.43
2.17
2.71
2.92
9.23

APCD
20,000
Gal /Day
74.03
1.43
2.17
2.74
2.96
9.30
                                        2.19
11.11
2.19
11.11
2.19
11.11
          1
           Assumes  top submerged loading of tank wagons at bulk plants
          Source:  U.S.  Environmental  Protection Agency

-------
ro
Daily Gasoline
 Throughput:

Installed Capital Cost

Annual Operating Cost
   Labor
   Utilities
   Maintenance
   Taxes, Insurance, G&A
Total Operating Cost
                        r
Gasoline Recovery Credit*

TABLE
IV. 10



OPTION 3
ESTIMATED 1978 COSTS TO INSTALL A PRIMARY,
VAPOR INCINERATION SYSTEM AT BULK PLANTS1

NOJC
4,000
Gal /Day
48.32
1.43
0.16
1.31
1.93
4.83
(Thousand
r
u
COSTS
20,000
Gal /Day
50.99
1.43
0.16
1.39
2.04
5.02
Dollars)
0 S T S C E
HOUSTON-GAL
COSTS
4,000
Gal /Day
35.96
1.43
0.16
0.94
1.44
3.97
N A R I 0 -
VESTON
20,000
Gal /Day
38.24
1.43
0.16
1.01
1.53
4.13

COLORADO
COSTS
4,000
Gal /Day
29.10
1.43
0.16
0.74
1.16
3.49

APCD
20,000
Gal /Day
30.14
1.43
0.16
0.77
1.21
3.57
          Assumes top submerged loading of tank wagons at bulk plants
         2
          No gasoline recovery credit when using an incineration system
         Source: U.S. Environmental Protection Agency

-------
ro
          Daily Gasoline
           Throughput:
          Installed Capital  Cost
Annual Operating Cost
   Labor
   Utilities
   Maintenance
   Taxes, Insurance, G&A
Total Operating Cost

Gasoline Recovery Credit

TABLE
IV. 11


OPTION 3
ESTIMATED 1978 COSTS TO INSTALL A PRIMARY REFRIGERATION
AND A STAND-BY INCINERATION SYSTEM AT BULK PLANTSl




NOJC
4,000
Gal /Day
117.42
1.43
2.17
3.59
"\ 4.70
11.89
(Thousand
	 .,, r


COSTS
20 ,000
Gal /Day
120.12
1.43
2.17
3.67
4.80
12.07
Dollars)
0 S T

SCENARIO-
HOUSTON-GALVESTON

4,000
Gal /Day
105.09
1.43
2.17
3.22
4.20
11.40
COSTS
20,000
Gal /Day
107.37
1.43
2.17
3.29
4.29
11.18



COLORADO APCD
COSTS
4,000 20,000
Gal /Day Gal /Day
98.23 99.27
1.43 1.43
2.17 2.17
3.02 3.05
3.93 3.97
10.55 10.62
                                       2.08
10.55
2.08
10.55
                                                                                         2.08
                                                                                           10.55
         1
          Assumes top submerged loading of tank wagons at bulk plants.
          The gasoline recovery credit has been adjusted to reflect that no credit will be realized when the
          stand-by system is operating.
         Source: U.S. Environmental Protection Agency

-------
ro
CJl
TABLE IV. 12
OPTION 3
ESTIMATED 1978 COSTS TO INSTALL A PRIMARY INCINERATION
AND A STAND-BY INCINERATION SYSTEM AT BULK PLANTS1
(Thousand Dollars)
rncr errwnnTft
Daily Gasoline
Throughput:
Installed Capital Cost
Annual Operating Cost
Labor
Utilities
Maintenance
Taxes, Insurance, G&A
Total Operating Cost
Gasoline Recovery Credit
Assumes top submerged loadi
2
NOJC
4,000
Gal /Day
73.55
1.43
0.16
1.62
2.94
COSTS
20,000
Gal /Day
76.25
1.43
0.16
1.70
3.05
6.15 6.34
ng of tank wagons at
\*> u o i .ji>L.iir\r\iu
HOUSTON-GALVESTON
COSTS
4,000
Gal /Day
61.22
1.43
0.16
1.25
2.45
5.29
bulk plants.
20,000
Gal /Day
63.50
1.43
0.16
1.32
2.54
5.45
COLORADO
COSTS
4,000
Gal /Day
54.36
1.43
0.16
1.05
2.17
4.81
APCD
20,000
Gal /Day
55.40
1.43
0.16
1.08
2.22
4.89
         Source:  U.S.  Environmental Protection Agency

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                      V. BULK STORAGE MODELS

A.   INTRODUCTION
     Because it would be impossible to assess the economic impacts of
each of the proposed vapor control options for the bulk storage industry
on an individual basis, Arthur D. Little has developed six bulk storage
models to be used as illustrative analytical tools.  The six bulk
storage model are: large and small marine terminal, large and small
pipeline terminal, and large and small bulk plant.  Bulk terminals
were distinguished according to mode of gasoline receipt because the
financial and operational profiles of marine and pipeline terminals
having identical gasoline throughput would be substantially different.
No differentiation regarding the mode of gasoline receipt was made in
the case of the bulk plant models where both were assumed to receive
product from bulk terminals by truck transport.  The sizing of the
bulk storage models  is  based on average daily gasoline throughput and
corresponds exactly  with the throughput parameters of the model  vapor
control  systems supplied by the EPA, i.e.  500,000 gallons/day for the
large marine and pipeline terminals, 20,000 gallons/day for the large
bulk plant, 250,000  gallons/day for the small marine and pipeline
terminals, and 4,000 gallons/day for the small  bulk plant.  By using
the bulk storage models in conjunction with the model vapor control
systems, economic and financial parameters, e.g. profitability, debt
capacity, and tariff rates, were tested under base case conditions
and then for each of the proposed regulations.   The changes in these
variables provided valuable insight in conducting the economic impact
analysis indicating how and to what degree the bulk storage industry
might actually be affected by the vapor control options.  In this
chapter, the bulk storage models and the cost pass through assumptions
applying to each are discussed.  The model  of the large marine terminal
is presented below only as an example of the type of data which com-
prises each of the models.  A complete presentation of all six bulk
storage models appears in Appendix C.
                                 V.I

-------
B.   BULK STORAGE MODELS
     Beginning with one of the specific daily  gasoline  throughputs
discussed above, other pertinent operational  and facility parameters,
e.g. non-gasoline throughput,  storage capacity and physical  plant,
were calculated for each of the bulk storage models  (Table V.I).
These and subsequent model calculations were made using industry
information and in-house Arthur D.  Little knowledge.

     Gross and net investment  profiles were developed for the  terminal
and bulk plant models assuming that terminals  and bulk  plants  were
built 10 and 25 years ago, respectively.  The  investment profiles
only include bulk storage operations; ancillary marketing operations,
e.g. service stations, and inventory allocated to class of trade  profit
centers were excluded.  The net investment or  book value of  these
facilities was calculated by adjusting the original  gross investment
to take into account depreciation and equipment replacement  (Table  V.2).
The current net investment of  the six bulk storage models is shown  in
Table V.3.  The gross replacement cost, i.e.,  capital  required to  build
new storage facilities, is not presented since very few new  terminals
or bulk plants ^re expected to be built in the near future.

     Operating expenses include labor costs, maintenance and repair,
utilities, taxes and insurance (Table V.4).  As would be expected,
total unit operating expenses, i.e. dollars/gallon,  of  the larger
terminal and bulk plant models are less than those of the smaller
models because of their economies of scale (Table V.5).   Labor is the
largest component of total operating expense in all  models,  but its
unit cost, or percent of total operating costs, is less in the larger
models.  The number of supervisors and workers at each  bulk  storage
facility was based on the average number of employees at actual facili-
ties having similar operating  characteristics.

     The target tariffs of the bulk plant models were assumed  to be
the same for all products.  In reality, each  product delivered to a
                                 V.2

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                            TABLE V.I
                  LARGE MARINE TERMINAL PROTOTYPE
OPERATIONS
Storage
(Thousand Barrels)

Annual Tank Turnovers

Annual Throughput
(Million Gallons).

Daily Throughput
(Thousand Gallons)
                             Gasoline
                                         PRODUCT GROUP
Distillate
Total
217
20
182.5
500
424
9
160.2
439
641
13
342.7
939
FACILITIES


No. of Tanks      - 10

Land (Acres)      - 25

No. of Employees  - 21

Method of Receipt - Marine Tanker  (35,000  DWT)



Source: Arthur D. Little, Inc.
                                 V.3

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                               TABLE V.2

                     ESTIMATED INVESTMENT PROFILE OF
                     LARGE MARINE TERMINAL PROTOTYPE
                           (Thousand Dollars)
INVESTMENT
A.
   GROSS        NET   ,
INVESTMENT  INVESTMENT1
                                                                    NET COST
    Depreciable Fixed Assets
    Tanks
    Building
    Dock
    Meters, Piping, Pumps
    Loading Racks, etc.
    Miscellaneous Equipment
      Total Depreciable  Assets

B.  Other Fixed Assets
    Land
    Engineering
    Capitalized Interest

                   2
C.  Working Capital

    TOTAL INVESTMENT
1,921.5
35.0
650.0
200.0
1,000.0
365.0
960.8
17.0
100.0
175.0
940.0
183.6
                                        4,171.5   2,376.4
                                                    760.0
                                                    350.0
                                                    400.0
                                                  1,510.0

                                                     40.0

                                                  3,926.4
                                                                ($/Shell  Barrel)
                                                                      1.50
                                3.71
                                2.36

                                 .06
                                6.13
1
 Book value of 10 year old facility.
"Excluding inventory allocated to class of trade sales profit centers.
Source: Arthur D. Little, Inc.
                                  V.4

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                           TABLE V.3

                        ESTIMATED 1978
             NET INVESTMENT OF BULK  STORAGE  PROTOTYPES
                       (Thousand Dollars)


STORAGE FACILITY             LOW THROUGHPUT1          HIGH THROUGHPUT2
Marine Terminal                    1,952                    3,926


Pipeline Terminal                    990                    2.473


Bulk Plant                           57                      143
^aily gasoline throughput is 250,000 gallons for terminals  and 4,000
 gallons for bulk plants.

2Daily gasoline throughput is 500,000 gallons for terminals  and 20,000
 gallons for bulk plants.
Source: Appendix C
                              V.5

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                             TABLE V.4
ESTIMATED 1978 OPERATING EXPENSES OF
LARGE MARINE TERMINAL PROTOTYPE

(Thousand Dol
Labor


a)
b)
c)
d)
e)






Straight Time
15 men X 52 X $320/wk
($8.00/hr)
3 Supervisors
Plant Manager
Plant Secretary/Clerk
Straight Time (S&W)
Overtime
15 men X 47 X $48/wk
(4 hr & $12.00/hr)
Benefits (25% of a)
PICA (6.13% of a+b)
Employee expenses
Total Labor Expense
1. Total Labor Expense
2. Miscellaneous Services
3. Maintenance & Repairs
4. Utilities & Misc.
Operating Expenses
5. Local Taxes
6. Insurance/Misc. Fixed Costs
lars)
Annual
Expense
249.6
75.0
35.0
27.0
386.6
33.8
96.7
23.2
17.6
557.9
557.9
11.2
28.1
65.0
150.0
175.0

$/Annual Percent of
Throughput Total
Gallon Expenses







.00163 56%
.00003 1%
.00008 37.
.00019 7%
.00044 1 5%
.00051 18%
        Total  Expenses
987.2
.00288
100%
Source:  Arthur D.  Little,  Inc.
                                V.6

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Storage Facility
Marine Terminal
Pipeline Terminal
Bulk Plant
                                           TABLE V.5

                                ESTIMATED 1978 OPERATING EXPENSE
                                   OF BULK STORAGE PROTOTYPES
Low Throughput
Thousand
Dollars

502.9
423.5
54.9
Dollars Per
Annual Through-
put Gallon
.00394
.00305
.02670

Percent
Labor
' en
59%
71%
2
High Throughput
Thousand
Dollars

987.2
732.3
162.5
Dollars Per
Annual Through-
put Gallon
.00288
.00243
.01486

Percent
Labor
57%
48%
48%
 Daily gasoline throughput is 250,000 gallons for terminals and 4,000 gallons for bulk plants.
 Daily gasoline throughput is 500,000 gallons for terminals and 20,000 gallons for bulk plants-
Source:  Appendix C

-------
different class of trade would have its own tariff rate.   However, a
facility-wide tariff can be assumed for our analysis without loss of
generality.  Bulk storage models were treated as individual  profit
centers and the tariffs were calculated so as to cover all operating
expenses and to return 20% before federal income tax (BFIT)  on a
discounted cash flow (DCF) basis over a 20-year investment horizon
(Table V.6).  The target tariffs for each of the bulk storage models
appear in Table V.7.

C.  COST PASS THROUGH ASSUMPTIONS
     Although 100% of the costs associated with vapor control may be
passed through to buyers, we have assumed that the incremental costs
of vapor control may  be absorbed by the bulk storage models to vary-
ing degrees.  The price setter or market leader of each type of
storage facility in an area was assumed to be the most efficient
facility and, presumably, the largest.  This facility, because of
its unique market position, will be able to pass through  the full
cost of vapor control by increasing its tariff to where it covers all of
its incremental vapor control costs and hence, does not experience any
decline in margin.  A less efficient facility,-however, competing with
the market leader, will  be constrained to only passing through,  at
most, the same unit cost as the market leader.  This "competitive"
pass through maintains the same tariff differential between the two
facilities after vapor control costs are considered as before (Table
V.8).  An attempt by the less efficient model to pass through a
greater portion of the vapor control costs would further weaken its
competitive position relative to the market leader.  By not passing
through the full cost of vapor control, the less efficient facility
will have to absorb some of the cost, thereby causing a decrease in
margin, and hence, profitability.

     Because pipelines are the most attractive method of transporting petro-
leum products  and because most are  currently operating at  full capacity,
we have assumed for our analysis that both the small and large pipeline
                                V.8

-------
                      TABLE V.6


       REQUIRED 1978 TARIFF (PRE-VAPOR CONTROL)

          OF LARGE MARINE TERMINAL PROTOTYPE
Total Investment

   X Annual Capital Recovery Factor
     (20% BFIT, 20 Years)
                 Net  Investment
               (Thousand  Dollars)

                   3926.4


                        .2054
                                                   806.5
Operating Expenses

Capital Recovery

 Total
                            Annual Cost       Required Tariff
                         (Thousand Dollars)  (Dollars Per Annual
                                              Throughput Gallon)
  987.2

  806.5

1,793.7
.00288

.00235

.00523
Source: Arthur D. Little,  Inc.
                           V.9

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                       TABLE V.7

       REQUIRED TARIFF OF BULK STORAGE PROTOTYPES
              TO COVER ESTIMATED 1978 COSTS
                    (Dollars/Gallon)
Storage Facility

Marine Terminal

Pipeline Terminal

Bulk Plant
Low Throughput

     .00708

     .00451

     .03238
                                         1
High Throughput

     .00523

     .00412

     .01754
1
 Daily gasoline throughput is 250,000 gallons for terminals and
 4,000 gallons for bulk plants.

"Daily gasoline throughput is 500,000 gallons for terminals and
 20,000 gallons for bulk plants.
Source: Appendix C
                            V.10

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                       TABLE V.8

            EXAMPLE OF COMPETITIVE ECONOMICS
             OF TWO BULK STORAGE FACILITIES
                    (Dollars/Gallon)
                                  Most Efficient    Less Efficient
                                     Facility          Facility
Pre-Vapor Control Tariff               .0050             .0080

Tariff Differential                    	 .0030 	

Vapor Control Cost                     .0010             .0020

Cost Pass Through                      .0010             .0010

Post-Vapor Control Tariff              .0060             .0090

Tariff Differential                    	 .0030 	

Absorbed Vapor Control Cost                              .0010
                            V.ll

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terminal models will pass through the full cost of vapor control.   In
the case of marine terminals, which usually handle the marginal
barrel of product, full cost pass through is only permitted for the
larger model.  The small marine terminal model will only pass through
the same unit cost as the larger facility in order to maintain the
same competitive position.  Similarly, the large bulk plant model  is
permitted to pass through the full cost of vapor control while the
small bulk plant model cannot.  However, we estimate that 30% of the
small bulk plant population, because they operate in areas partially
shielded from external competitive forces by transportation economics,
would in reality be able to pass through all costs associated with
vapor control.  This estimate is based on our discussions with the
petroleum industry, particularly with regional jobber and petroleum
marketer associations.  Although the actual percentage varies geo-
graphically between 20% and 50%, the nationwide average is believed
to be roughly 30%.
                                V.12

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                     VI. BULK TERMINAL IMPACTS

-A.   INTRODUCTION
     The purpose of this chapter is to identify all bulk terminals
that are subject to the proposed vapor control regulations and to
estimate the economic impacts of those regulations on the bulk ter-
minal industry.  These economic impacts are expressed as the number
of potential bulk terminal closures expected to occur because of the
various vapor control options, the employment displaced by these
closures, and the nationwide cost of installing, financing and
operating vapor control equipment at all remaining facilities.  No
attempt, however, has been made to express the costs of bulk terminal
closures and the displaced work force in monetary terms.  Also, the
nationwide cost of installing vapor control equipment in the gasoline
truck transport fleet, which was calculated separately from the bulk
terminal impacts, is presented in this chapter.

B.   BULK TERMINAL POPULATION SUBJECT TO VAPOR CONTROL
     Not all of the terminals identified by the market audit are
subject to the vapor control options discussed in Chapter IV.  The
exceptions include those  gasoline terminals which are expected to
close within the next five years because of competitive economics and
market rationalization, terminals not handling gasoline, and terminals
already in compliance with the proposed options.   From our discussions
with the bulk terminal  industry, an estimated 20 gasoline terminals,
or 3% of the smallest marine terminals, are expected to close by  1983
because of reasons other  than vapor control.  While the mandatory
installation of vapor control equipment may accelerate the decision
to close these facilities, their closure cannot be attributed solely
to the imposition of vapor control economics» and  therefore,  are
excluded from the following closure analysis.  Similarly, the 240
bulk terminals identified by the market audit as having no gasoline
throughput are not included in the closure analysis as they would
not be subject to the vapor control regulations (Table VI.l).
                                 VI.1

-------
                             TABLE VI.l
PETROLEUM
PADD
I
II
III
IV
V
Total
BULK TERMINALS HAVING NO
NUMBER OF
TERMINALS
88
86
42
—
24
240
GASOLINE THROUGHPUT
PERCENT
OF TOTAL
37%
36%
18%
—
10%
100%
Source:   Arthur D.  Little, Inc.
                                 VI.2

-------
Finally, the estimated 360 bulk terminals which  have already installed
vapor control  systems are not assumed to be subject to  the proposed
regulations.  However, because the EPA is expected to require  the
continuous and efficient operation of all vapor  control  systems, these
facilities may have to install a stand-by unit,  vapor holder,  or be
prepared to shut down gasoline loading operations  should the primary
control  system become inoperative.

     After adjusting the 1978 market audit total for the above three
factors, approximately 1,131 bulk terminals, or  65% of the total
terminal population, are subject to the vapor control options  presented
in Chapter IV (Table VI.2 and Figure VI.l).  A distribution of these
facilities by gasoline throughput indicates that almost half of the
terminals have less than 200,000 gallons/day of gasoline throughput
(Table VI.3).  For the following closure analysis, the small bulk
terminal models having "low" throughputs of 250,000 gallons/day act  as
surrogates for the bulk terminal population having less than 400,000
gallons/day of gasoline throughput.  Similarly,  the larger terminal
models having "high" throughputs of 500,000 gallons/day act as surro-
gates for the terminal population having greater than 400,000 gallons/
day of gasoline throughput.

C.   CLOSURE ANALYSIS
     Bulk terminals subject to vapor control regulations are assumed
to close because of either of the following two reasons:

     •  Terminal operators are unable to obtain the capital
        necessary to install vapor control equipment,  or
     •  Terminals would operate below a minimum acceptable
        level of profitability if vapor control  equipment
        were installed.
                                 VI.3

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                      TABLE  VI.2

         PETROLEUM BULK TERMINALS SUBJECT TO

         THE PROPOSED VAPOR  CONTROL  OPTIONS
1978 Bulk Terminal  Audit                   1,751
Terminal Closures Between 1978
and 1983 Because of Market                   (20)
Rationalization
Bulk Terminals Having No Gasoline           (240)
Throughput
Gasoline Terminals Already Having           (360)
Vapor Control Systems	_
Total Number of Terminals Subject
to the Proposed Vapor Control               1,131
Options
Source:  Arthur D. Little, Inc.
                         VI.4

-------
CJ1
                  0)
                  u
                  O)
                  0_
                  0>
                  +3
                  E
                  3
                  O
                     100
80
60
                     40
                     20
                      0
         Marine
       Terminals
                                  All
                               -Terminals
                                                                                        Greater
                                100
                     200
300
                                                             400
                                                 500
                            600    Than 700
                                                               Gasoline Throughput
                                                              (Thousand Gallons/Day)

                                       FIGURE VI.1   DISTRIBUTION OF BULK TERMINALS
                                                    SUBJECT TO VAPOR CONTROL

-------
                              TABLE  VI.3
DISTRIBUTION OF GASOLINE TERMINALS
SUBJECT TO THE PROPOSED VAPOR CONTROL OPTIONS
DAILY GASOLINE
THROUGHPUT
Thousand
Gallons
<200
200 - 400
400 - 600 1 ,
>600
Cubic
Meters
< 760
760 - 1,510
510 - 2,270
>2,270
NUMBER OF
TERMINALS
535
305
238
53
PERCENT
OF TOTAL
47%
27%
21%
5%
  Total                              1,131                  100%
Source:   Arthur D.  Little,  Inc.
                                  VI.6

-------
1.    Availability of Capital
      While over two-thirds of the bulk terminals  are owned by the
major and semi-major oil companies having very good access to capital
markets, for this analysis each bulk terminal  is treated as a separate
profit center in determining its ability to secure the capital necessary
to install vapor control equipment.  Because an in-depth financial
examination of each and every terminal is impractical and infeasible,
the bulk terminal models presented in Chapter V will act as surrogates
for the bulk terminal industry.  The inability of these models to
incur and to service the incremental debt required to comply with the
vapor control regulations was translated into potential closures in
the actual bulk terminal' population.  This approach represents "stand
alone" economics without any cross-subsidies and is generally the way
the petroleum companies would view these economics, although there may
be some exceptions.

      a.  Capital Requirement
      The capital required to install any of the various vapor control
systems which are under consideration generally represents less than
15% of the existing net investment at the marine and large pipeline
terminal models (Table VI.4).  Vapor control investment is most signi-
ficant, up to 30% of net investment, for the small pipeline model since
its asset base is not as extensive as that of the other terminal models.
However, this model's substantial throughput volumes and the ability to
pass through the entire cost of vapor control counter balance this
apparent weakness.

      b.  Approach
      Since we stated that no cross-subsidy will come  from either the
parent corporation or ancillary marketing operations,  the  terminal
operators  have been assumed to seek  capital from  commercial  lenders.
Therefore, within this  analysis an attempt is made  to  simulate
the lending  criteria employed by  commercial loan officers.   A lender
considering  an applicant's request for  funds is primarily  interested
                                 VI.7

-------
                                                                              TABLE VI.4
o
     MARINE TERMINAL

     Pre-Vapor Control Net
       Plant Investment

     Vapor Control Investment

     Vapor Control Investment as
       a Percent of Pre-Control
       Net Investment
     PIPELINE TERMINAL

     Pre-Vapor Control Net
      Plant Investment

     Vapor Control Investment

     Vapor Control Investment as
      a Percent of Pre-Control
      Net Investment
                                                  ESTIMATED 1978 VAPOR CONTROL CAPITAL REQUIREMENTS OF BULK TERMINALS
                                                                          (Thousand Dollars)
                                                     LOW THROUGHPUT MODEL
                                     Primary Control System

                                   Refrigeration  Incineration
1951.6

 204.0



   10*





 989.9

 204.0



  .21*
1951.6

 144.0



    7*





 989.9

 144.0



   15%
                           Primary System With  Stand-By
                          Refrigeration/  Incineration/
                           Incineration   Incineration
1951.6

 299.0



   15*
 989.9

 299.0



   30%
1951.6

 239.0



   12*
 989.9

 239.0



   24%
Primary Control System
Refrigeration
3926.4
306.0
8*
2473.1
306.0
Incineration
3926.4
190.0
5*
2473.1
190.0
unrui nuucL 	
Primary System
Refrigeration/
Incineration
3926.4
432.0
m
2473.1
432.0
With Stand-By
Incineration/
Incineration
3926.4
316.0
8*
2473.1
316.0
12%
17*
13%
     Source: Appendix C and EPA cost estimates

-------
in the borrower's ability to repay the full  amount of the loan,  i.e.
principal  as well as interest.   If a lender is confident that  the  loan
can be easily repayed under normal business  conditions,  the loan will
probably be made.  If, however, the prospective borrower is already
so leveraged that repayment would be difficult if an unexpected  business
downturn occurred, a lender then would have to rely more heavily upon
subjective factors such as the borrower's past relationship with the
lender, his credit history, the quality of the collateral pledged,
and the future outlook of the borrower's business.  Under these  circum-
stances, a borrower may in theory have the resources necessary to
repay the debt, but the lender may feel that he would be undertaking
too much risk in making the loan.  A decision to extend funds  in this case
would widely vary among lenders according to each lender's risk  threshold.
Lastly, if it would be difficult for the borrower to repay the lender
even under normal business conditions, there would be no hesitation
on a lender's part to refuse the loan.  Many financial tools,
e.g. quick ratio, current ratio and debt-to-equity ratio, could be used
to measure a terminal's ability to incur and service debt.  However,
the analytic tool used in this analysis is total term debt as  a percent
of after-tax cash flow, or put another way, the ratio of the terminal's
projected after-tax cash flow to  its total debt obligation.

      In the commercial lending model used for our analysis, as long as
the borrower's anticipated after-tax cash flow, i.e. net profit plus
depreciation, is at least twice as large as his total debt obligation,
i.e. principal of pre-vapor control and vapor control related debt,
it is assumed that the loan will  be made (Table VI.5).   If, however,
projected cash flow exceeds the total debt obligation, but not by a
factor of 2, then the lender will become more cautious when considering
this loan relative to his overall risk portfolio and downside exposure.
 This figure does not include interest payments as they have already
 been taken into account when calculating the after-tax cash flow. See
 Appendix F for the cash flow worksheets used in this analysis.
                                 VI.9

-------
                             TABLE VI.5

                 BORROWING CRITERIA USED IN ANALYSIS
Debt as
a Percent of
After-Tax Cash Flow
Ratio of After-
Tax Cash Flow
to Debt
     Lender's
     Decision
   0 - 50%
Greater than 2:1
Loan is adequately
covered.  Loan will
be made.
 50 - 100%
2:1 to 1:1
Loan is covered but
lender assumes
increasing risk.
Probability of refusal
increases proportionately
as the debt percentage
increases (Figure VI.2).
Greater than 100%
less than 1:1
Loan is not covered.
Loan will not be made.
Source:  Arthur D. Little, Inc.
                                 VI.10

-------
Within this range, the probability that the loan will  be rejected  is
assumed to be directly proportional  to the calculation of term debt
as a percentage of cash flow (Figure VI.2).  In reality, however,  this
relationship would be non-linear, particularly at the endpoints,
although this simple linear model will suffice for our purposes.   Finally,
if the borrower's cash flow cannot fully meet his total debt obligation,
the loan would clearly be rejected as the incremental  debt obligation
of the vapor control loan would render the borrower insolvent.  This
financial tool is certainly not the only criteria employed in the
commercial lender's calculus when he is evaluating a loan candidate.
As stated above, many other financial tools and subjective factors
will also come to bear on the loan decision.  Moreover, the decision
thresholds described above would not always be as clear-cut.  However,
this lending model is useful in our analysis because it is reasonable,
straightforward, and easy to apply.

      Discussions with independent marketers and terminal operators
indicate that 25-40% of the net plant investment of many terminals is
currently mortgaged.  Therefore, debt as a percent of cash flow was
calculated for the bulk terminal models thereby establishing a base
case, by assuming that 30% of the net plant investment was mortgaged
for 20 years at an 8% annual interest rate.  In this base case, the
existing debt principal of the bulk terminal models was approximately
11-12% of projected annual after-tax cash  flow  (Table  IV.6).  Cash flow,
therefore, covered debt obligations by  a ratio  of 9:1.  This percentage
was again calculated assuming that 100% of the  required vapor control
investment was financed for 8 years at  a 9% annual interest  rate.
After the costs of the model vapor control systems had been  folded
into the calculation, the models' total debt obligation was  between
16% and 28% of cash flow, still well below the  50% threshold established
by the lending model presented in Table VI.5.   These percentages
 Terms quoted by a sample of commercial lenders.
                                  VI. 11

-------
    100% i-
     0%
             20%    40%    60%   80%
          Debt Repayment Obligation as a Percent
          of After-Tax Cash Flow
                            100%
FIGURE VI.2
AFTER TAX CASH FLOW AS A DETERMINANT
FOR SECURING A COMMERCIAL LOAN FOR
VAPOR CONTROL EQUIPMENT

-------
MARINE TERMINAL
                                                                         TABLE  VI.6
                                               TERM DEBT AS  A PERCENT OF AFTER-TAX  CASH  FLOW AT 8IJLK TERMINALS
                                                LOW THROUGHPUT MODEL
                                 Primary Control  System     Primary  System With Stand-By
                              	i	*	  Refrigeration/  Incineration/
                              Refrigeration  Incineration    Incineration   Incineration
                                                                            HIGH  THROUGHPUT MODEL
                                                                                        Primary System Kith Stand-By
                                                                                      Refrigeration/  Incineration/
                                                          Refrigeration   Incineration    Incineration   Incineration
                                             Primary Control  System
Pre-Vapor Control
122
12%
                                              12%
                                                                                                 11%
                                                              m
                                                                                          n%
                                                                                                                                              m
Post-Vapor Control
19%
17%
22%
                                              20%
                                                                                                 17%
                                                             15%
                                                                                          19%
                                                                             17%
PIPELINE TERMINAL


Pre-Vapor Control


Post-Vapor Control
11%
24%
11%
21%
11%
28%
11%
26%
11%
19%
                                                                            11%
16%
                                                                           11%
                                                                                                                             21%
                               11%
                                                                                                           19%
Source:   Appendix  F

-------
indicate that the models have 3 to 4 times the annual cash flow necessary
to meet both their base case and their vapor control debt obligations.
For bulk terminals with less than 30% of net plant investment mortgaged,
the amount of coverage would be even greater.

      c.  Closure Summary
      From the results of the preceding analysis, it is concluded that
no bulk terminal closures are likely because of an inability to
obtain the necessary capital.

2.    Insufficient Profitability
      The bulk terminals having access to adequate capital may still
close as the result of the vapor control regulations if, after install-
ing and operating vapor control equipment, they could no longer attain
a minimum acceptable level of profitability.  Bulk terminals are
assumed to continue operating as long as they can meet all current
liabilities, i.e. operating expenses (including salaries) and debt
obligations (principal and interest payments).  Under this condition,
terminals are assumed to remain open even though they are not earning
any return on equity investment.  This is a valid argument if the
terminal operator has limited business alternatives in which to re-
deploy his equity investment, or if he expects business to improve in
the near future.

      a.  Approach
      In order to generate a revenue stream sufficient to continue
operations, i.e. to breakeven, a minimum product throughput at all
bulk terminals must be sustained.  After netting out the revenue
contribution of the non-gasoline products, all revenue .necessary to
meet the remaining current liabilities must be generated through
gasoline volumes.  The gasoline volume necessary for a terminal to
remain open is referred to here as the "gasoline breakeven throughput."
Bulk terminals that operate below this breakeven volume are assumed
to close, while those that operate above it are assumed to remain open.
                                 VI.14

-------
Vapor control regulations, however, will in effect raise this breakeven
point and require a larger gasoline throughput  in order to cover the
incremental operating expenses and debt obligation (Table VI.7).   In
this analysis, attention is focused on the number of terminals which
may operate above this breakeven volume in the pre-vapor control  case,
but below its new breakeven volume when the economics of vapor control
are considered.

      Most terminals are not expected to experience any change in
gasoline breakeven throughput since they will pass through the full
cost of vapor control by way of tariff increases.  The additional
revenue resulting from this tariff increase is assumed to exactly
offset all incremental expenses caused by vapor control.  Only some
small marine terminals, which do not pass through their entire vapor
control costs, will perceive a change in their minimum gasoline through-
put requirement.  Because of competitive economics, these facilities
will be limited to the same per gallon tariff increase as the larger
terminals.  Therefore, some marine terminals will have to absorb portion
of the cost of vapor control themselves, thereby falling below the
adjusted breakeven throughput.  An example as to how  this analysis
was conducted is shown in Figure VI.3.  Presumably, the affected
facilities would realize this consequence and close without  actually
installing vapor control equipment.  The changes in profitability and
gasoline tariffs of the bulk terminal models caused by the proposed
vapor control regulations are summarized in Table VI.8.

      b.   Closure Summary
      Our  analysis indicates that  23 to 51 terminals, or  2-5% of all
gasoline terminals subject to the  vapor control  regulations, are
likely   to  close because they would now operate below their gasoline
  The  throughputs of the  non-gasoline  products  and hence,  their  revenue
  contribution, are assumed  to  remain  the  same  as they were  in the pre-
  vapor  control case.
                                 VI.15

-------
                                                                         TABLE  Vj.7


                                                        CHANGE  IN DAILY GASOLINE  BREAKEVEN  THROUGHPUT

                                                      AT BULK TERMINALS BECAUSE OF VAPOR  CONTROL COSTS
                                                LOW THROUGHPUT MODEL
                                                                              HIGH  THROUGHPUT  MODEL
                              Primary System With Stand-By
                             Refrigeration/  Incineration/
Refrigeration  Incineration   Incineration   Incineration
                                Primary Control  System
MARINE TERMINAL

Gasoline Breakeven Through-
 put (Pre-Vapor Control)          117.2

Incremental  Gasoline Through-
 put Required Due to Vapor
 Control Capital and
 Operating Costs                  13.3

Gasoline Breakeven Through-
 put (Post-Vapor Control)        130.5

Percent Increase Over Pre-
 Control Throughput                11*
                                                117.2
                                                 17.9
                                                135.1
                                                  15*
                              117.2
                               24.4
                              141.6
                                2U
                                                 117.2
                                                  28.0
                                                 145.2
                                                   24%
                                                                    ,  C.ntn.1  S,.te.
                                                                                             Refrigeration   Incineration    Incineration   Incineration
                                 213.8
                                   0.0
                                 213.8
                                    0%
                               213.8
                                 0.0
                               213.8
                            213.8
                              0.0
                            213.8
                               213.8
                                 0.0
                               213.8
                                                                 0%
PIPELINE TERMINAL

Gasoline Breakeven Through-
 put (Pre-Vapor Control)

Incremental  Gasoline Through-
 put Required Due to Vapor
 Control Capital  and
 Operating Costs

Gasoline Breakeven Through-
 put (Post-Vapor Control)

Percent Increase  Over Pre-
 Control Throughput
145.7
                  145.7
145.7
145.7
212.5
212.5
                                                                                                                           212.5
212.5
0.0
145.7
or.
0.0
145.7
or.
0.0
145.7
.0*
0.0
145.7
0%
0.0
212.5
0%
0.0
212.5
0%
0.0
212.5
0%
0.0
212.5
0%
 Assuming competitive pass through.
Source: Arthur D. Little, Inc.

-------
100
 80
 60

JO
3
|
o
40
20
    Post-Vapor
    Control
    Breakeven
    Throughput
 Pre-Vapor
 Control
"Breakeven
 Throughput
                           Facilities Expected to Close Because
                           of Insufficient Profitability
                                           J_
             100
                          200
                            300
400
500
                                                              600
                                                                            700
                       Daily Gasoline Throughput
                          (Thousand Gallons)
               FIGURE VI.3
                                 BREAKEVEN ANALYSIS OF THE
                                 MARINE TERMINAL POPULATION

-------
                                                                               TABLE  VI.8
                                                              BULK TERMINALS ROI AND GASOLINE TARIFF  IMPACTS1
                                                      LOW THROUGHPUT MODEL
      MARINE TERMINAL

      Post-Vapor Control ROI

      Percent Increase/Decrease
       over Pre-Control ROI2

      Post-Vapor Control
       Gasoline Tariff ($/Gal)

      Percent Increase/Decrease
       over Pre-Control Gasoline
       Tariff
<:
•-«
L.    PIPELINE  TERMINAL
oo    	—
      Post-Vapor Control  ROI
      Percent  Increase/Decrease
       over Pre-Control  ROI2
      Post-Vapor  Control
       Gasoline Tariff  ($/Ga1
      Percent  Increase/Decrease
      over  Pre-Control Gasoline
      Tariff
                                      Primary Control System      Primary System H1th Stand-By
                                    TT~	~~.	~T	  Refrigeration/  Incineration/
                                    Refrigeration  Incineration   Incineration   Incineration
                                                                                                                     HIGH THROUGHPUT MODEL
 18.4%
(10.2%)
.0072
  2.8%
20.5%
                                        NC
.0048
                                       6.0%
 18.9%
 8.2%)
.0074
 5.IX
20.5%
                                                       NC
                                                      .0049
                8.4?;
                              17.5%
(14.9%)
                              .0075
                               6.TX
                                                                     20.5V
                                                                      NC
                                                                     .0050
                                                                    11.5:"
                                              17.8%
(13.1%)
                                              .0076
                                8.U
                                                                                     20.5%
                                                                                      NC
                                                                                     .0051
                                              13.5:'.
      Assuming competitive cost pass through
     2
      Pre-Control ROI is 20.5%.  ROI is simple before-tax return on net plant investment.

      No Change - assumes full pass through of costs for this model.
                                                               Primary  Control  System       Primary  System
                                                            	*	*	 Refrigeration/
                                                            Refrigeration   Incineration    Incineration    Incineration
                                                                                          With  Stand-By
                                                                                          Incineration/
20.5%


 NC3


.0054



 3.8%




20.5%



 NC



.0043




4.9%
                                                                             20.5%
                                                                              NC
                                                                             .0056
                                                                              6.9%
                                                                                                                    20.5";
                                                                                                                    NC
                                                                                                                    .0045
                                                                                                                    8.7%
 20.57.


  NC


 .0057



  8.2%




20.5%



 NC



.0046




10.4"
20.5'.


 NC


.0058



10.9:-





20.5',
     Source: Appendix G

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breakeven throughputs after installing vapor control  equipment (Table
VI.9).   The redistribution of product volume from these closures would
slightly increase the volumes of some other terminals, thereby helping
them meet post-vapor control throughput levels.  However, in this case,
the impact is so small that it can be disregarded.  These closures
are based on the refrigeration and the incineration systems.  If more
expensive technologies were considered, e.g., CRA or adsorption-absorp-
tion, the number of closures would be somewhat greater.  All of the
above closures are expected to be small marine terminals having less
than 150,000 gallons of daily gasoline throughput.  No closures are
expected to occur in either the large marine or the pipeline terminal
populations.

D.    TERMINAL IMPACTS
      In addition to terminal closures, the economic impacts of vapor
control  in the bulk terminal industry are expressed in terms of the
employment displaced by these closures and the monetary cost of in-
stalling, financing and operating vapor control systems at all remain-
ing terminals subject to the vapor control regulations.  While some
terminal operators may simply discontinue their gasoline throughput
rather than installing vapor control equipment, most operators are
not likely to be in a strong enough financial position to choose
this as  a viable alternative.  Therefore, this option has been excluded
from our discussion of potential terminal impacts.

1.    Employment Impact
      Between 300 and 700 workers, representing 1-2% of the estimated
employment at all gasoline terminals, are employed at the bulk terminals
expected to close because of vapor control economics (Table VI.10).
These employment figures were calculated by multiplying the average
number of workers at a small marine terminal by the estimated number
of closures.
                                 VI.19

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                                                      TABLE  VI.9
                              BULK TERMINAL CLOSURES  BECAUSE  OF  VAPOR CONTROL ECONOMICS
                                                                                       1
                                                 Primary  Control  System

                                              Refrigeration   Incineration
                                                                                  Primary System
                                                                                  With Stand-By
                                                                  Refrigeration/  Incineration/
                                                                   Incineration   Incineration
           Petroleum  Bulk  Terminals
            Subject to  Vapor Control
                                       1131
1131
1131
1131
rss
O
Terminal Closures Because of
 Inaccessibility of Capital
           Terminal  Closures  Because of
            Insufficient  Profitability
                                         23
  32
  46
  51
           Remaining  Terminals  Installing
            Vapor Control
                                       1108
1099
1085
1080
           1
           Assuming  competitive  cost pass  through.
           Source: Arthur  D.  Little,  Inc.

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                                                    TABLE VI.10

                             VAPOR  CONTROL  EMPLOYMENT AND COST  IMPACTS AT BULK TERMINALS
                                                PRIMARY CONTROL SYSTEM
                            PRIMARY SYSTEM WITH STAND-BY
                                              _  ,  .      .                     Refrigeration/   Incineration/
                                              Refrigeration    Incineration    Incineration    Incineration
         Small Marine Terminals Closed
         Due  to Vapor Control Economics
   23
   32
   46
                                                   51
        Estimated Employment at Closed
        Terminals
  320
  450
  640
                                                  710
rss
        Remaining Terminals Installing
        Vapor Control Systems
1,108
1,099
1,085
1,080
        Total Cost of Installing Vapor
        Control (Million 1978 Dollars)
  201.9
  329.0
  473.2
  580.4
        Source:  Arthur D.  Little, Inc., and Table  VI.11

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2.    National Cost of Compliance
      The total cost of vapor control, i.e.  installed capital  costs,
financing and operating expenses, less appropriate recovery credits
over the expected 10-year useful  life of the vapor control  equipment,
ranges from $200 million, if only primary vapor control  systems  are
required, to almost $600 million, if primar.y/stand.-by. systems  are
necessary (Table VI.10).  Larger costs would result if more expensive
technologies were considered, e.g. CRA and adsorption-absorption. The
installed capital costs of national compliance range  from $170  million
for a primary incineration unit to $365 million for a refrigeration
unit with incineration stand-by (Table VI.11).  These capital  costs
represent a substantial portion of the petroleum industry's $1.2 billion
1977 budget for the control  or air pollution, ranging from 15% to 26%.
Furthermore, in 1977 the major oil companies spent $803 million  for
environmental effluent abatement, of which the marketing portion was
                           2
approximately $120 million.    Table VI.12 shows the magnitude  of these
capital costs relative to the majors' estimated marketing budget for
environmental effluent abatement.  These costs range from 140% to 300%
of the estimated environmental control budgets.
E.    TANK TRAILER COSTS
      Because the installation of vapor control equipment in the truck
transport fleet is essential to the control of gasoline vapors at bulk
terminals, the nationwide costs of installing such equipment are con-
sidered in this chapter.  This cost could not be incorporated in the
model control system costs of the terminals because most gasoline
transports are owned by common carriers and not by terminal operators.
     and Gas Journal, March 20, 1978.
2API Publication No. 4259, Environmental Expenditures of the U.S.
 Petroleum Industry.
                                 VI.22

-------
ro
GJ
Capital Investment
              2
Financing Cost
                 3
Operating Expense

Recovery Credit
                  5
Capital Investment

Financing Cost

Operating Expense

Total  Vapor Control  Cost at
 Bulk Terminals
                                                       TABLE VI.11
                                       COST OF VAPOR CONTROL AT  BULK TERMINALS1

                                                (Million 1978 Dollars)
                                                                                       Primary  System
                                                                                       With  Stand-By
Refrigeration
255.7
77.8
205.4
(337. O)4
—
--
__
u i «jjr o ion
Incineration
171.6
52.2
105.2
—
--
—
--
Refrigeration/
Incineration
364.3
110.8
250.0
(314.7)
37.0
9.8
16.0
Incineration/
Incineration
280.5
85.3
151.8
--
37.0
9.8
16.0
                                                   201.9
329.0
473.2
580.4
           1
           All  future cash streams discounted to present value using a discount rate of 10%.

           Interest charges associated with vapor control debt are incurred over an 8-year period and
           discounted to 1978 value.
           3
           Operating expenses and recovery credits are realized over the 10-year useful life of the vapor
           control system and discounted to present value.
           4
           Represents a negative cost or a savings equivalent to the present value of the gasoline vapor
           which otherwise would have been discharged into the atmosphere if a vapor recovery system was not
           utilized.

           'Cost of incineration stand-by units for bulk  terminals  already having a  primary vapor control  system.
          Source: Arthur D. Little, Inc.  estimates based on EPA cost data

-------
                                             TABLE VI. 12


                       CAPITAL COST OF THE PROPOSED VAPOR CONTROL  OPTIONS  AS  A

                 PERCENT OF THE PETROLEUM INDUSTRY'S 1977 ENVIRONMENTAL  EXPENDITURES
Capital Cost of National  Vapor Control
 Compliance at Bulk Terminals (Million
 1978 Dollars)
                                            Primary Control  System
                                         Refrigeration   Incineration
256
172
                             Primary System With  Stand-By

                            Refrigeration/   Incineration/
                            Incineration     Incineration
364
280
Percent of Major Oil Companies' 1977
 Marketing Budget for Effluent Abatement
213%
143%
303%
233%
Percent of Total  1977 Industry Expenditures
 to Control Air Pollution                      22%
                 15%
                 26%
                  24%
Source: API Publication No.  4259, Environmental  Expenditures of the U.S.  Petroleum Industry.  Oil  &
        Gas Journal, Nov. 20, 1978. and Table VI.11.

-------
Therefore, while this  cost calculation is being treated separately,
it is still  a fundamental  part of the vapor control  options  addressing
bulk terminal operations.

      In 1978, there were an estimated 29,200 gasoline tank  trailers
in operation in the U.S., of which about 7,300 or 25% had already
installed vapor control  equipment.  Of the remaining trailers, 12,800
probably would be retrofitted with vapor control because they are less
than 5 years old, while the other 9,100 would have vapor control  equip-
ment installed in their eventual replacements.  Because gasoline demand
is not expected to increase significantly during the next 5  years, no
additional gasoline tank trailers are expected to be built other than
those needed to replace the existing fleet.  The new and retrofit
segments of the gasoline trailer fleet are summarized in Table VI.13.
Based on these estimates of the trailer population and the equipment
costs presented in Chapter V, the total cost of installing and operat-
ing vapor control equipment on the gasoline trailer fleet is $101.4
million over the useful  12-year life of the trailers (Table VI.14).
                                 VI.25

-------
                       TABLE  VI. 13
       ESTIMATED 1978 GASOLINE TRAILER POPULATION
MC-306 Trailers Built Between 1966 and 1978        36,900
Estimated 1978 Gasoline Tank Trailer Fleet         29,200
Trailers Already Equipped with Vapor Control       (  7,300)
Trailers to be Replaced within the next 5 years    (  9,100)
Retrofit Trailer Market                            12,800
Estimated trailer lifetime of 12 years.
New Trailers Built to Replace Existing Fleet
 within the next 5 years                            9,100
New Trailers Required Because of an Increase in
 Gasoline Demand                                      0
New Trailer Market                                  9,100
Total Number of Trailers Installing Vapor
 Control Equipment                                 21,900
Source: Department of Commerce and Arthur D. Little, Inc.
                          VI. 26

-------
                       TABLE  VI.14
    TOTAL COST OF INSTALLING  VAPOR  CONTROL EQUIPMENT
    	ON THE GASOLINE TANK TRAILER  FLEET	
                 (Million 1978 Dollars1)
Capital  Investment - Retrofit Market          26.9
                   - New Market               17.3
              2
Financial  Cost                                  5.0
                 3
Operating Expense                              52.2
TOTAL CONVERSION COST                         101.4
 All future cash streams discounted to present value,
 using a discount rate of 10%.
2100% debt financing for 3 years @ 9%.
 Incurred over estimated trailer lifetime of 12.3 years,
Source:  Arthur D. Little, Inc., and U.S. Environmental
         Protection Agency cost estimates
                           VI. 27

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                       VII.   BULK PLANT IMPACTS

A.   INTRODUCTION
     The purpose of this chapter is to identify all  bulk plants  that
are subject to the proposed vapor control  regulations and to estimate
the economic impacts of those regulations  on the bulk plant industry.
The analytic approach used in this chapter to calculate these economic
impacts is  the same as that used in the preceding chapter on bulk
terminal impacts.  An important addition to this analysis, however,  is
the calculation of economic impacts for the three control options using
three distinct cost or control system scenarios.  Because it is  beyond
the scope of this study to select a "most  likely" scenario, all  poten-
tial  impacts resulting from each are discussed below.

B.   BULK PLANT POPULATION SUBJECT TO VAPOR CONTROL
     As was the case in the bulk terminal  analysis, not all of the bulk
plants identified by the market audit are subject to the vapor control
options discussed in Chapter IV.  From the market audit results  pre-
sented in Chapter VI, approximately 3,480 bulk plants are expected to
close during the next five years because of competitive economics and
market rationalization.  The economics of vapor control may accelerate
their closing, but it cannot be held as the principal reason for their
closure.  Similarly, the 790 non-gasoline bulk plants and the estimated
120 bulk plants already having vapor control systems are not subject to
the proposed vapor control regulations and, therefore, are excluded
from our closure analysis.  Most of the bulk plants already having vapor
control systems would have to modify or augment their control capability
under the various regulations.  However, because these facilities rep-
resent less than 1% of all gasoline bulk plants, these bulk plants are
not considered further in the closure analysis with regard to possible
stand-by systems.  Therefore, approximately 14,250 bulk plants,  or 76%
of the total 1978 bulk plant population, are subject to potential
closure caused by vapor control economics (Table VII.I and Figure VII.I).
A distribution of these facilities by gasoline throughput appears in
                                 VII.1

-------
                         TABLE  VII.I


            PETROLEUM BULK  PLANTS  SUBJECT TO THE

               PROPOSED VAPOR CONTROL OPTIONS


1978 Bulk Plant Audit                              18,640
Bulk Plant Closures Between 1978  and  1983
Because of Market Rationalization                  (  3,480)
Bulk Plants Having No Gasoline Throughput          (    790)
Gasoline Bulk Plants Already Having
Vapor Control Systems                              (    120)
Total Number of Bulk Plants Subject to
the Proposed Vapor Control Options                  14,250
Source: Arthur D. Little, Inc.
                           VII.2

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  100
§  80
u.
OJ
CL
JO

3

E
D

CJ
60  -
   40  -
   20  -
    0
                         FIGURE VII.1
                                       8                  12

                                       Daily Gasoline Throughput

                                          (Thousand Gallons)



                                   DISTRIBUTION OF BULK PLANTS

                                   SUBJECT TO VAPOR CONTROL
                                                                           Than 16

-------
Table VII.2.  For the following closure analysis, the small  or low
gasoline throughput model, i.e., average 4,000 gallons/day,  will  act
as a surrogate for all  bulk plants having less than 8,000 gallons/day
of gasoline throughput.  Similarly, the larger or high .throughput
model, i.e., average 20,000 gallons/day, will  act as a surrogate  for
the bulk plant population having more than 8,000 gallons/day of
gasoline throughput.

C.  CLOSURE ANALYSIS
     Bulk plants subject to vapor control  regulations are assumed to
close because of the same reasons as bulk terminals:
     •  Bulk plant operators are unable to obtain the capital
        necessary to install vapor control equipment, or
     t  Bulk plants would operate below a minimum acceptable
        level of profitability if vapor control equipment were
        Installed.

Plant closures resulting because of the above  factors are calculated
for each of the three cost scenarios discussed in Chapter IV and  are
presented below.

1.  Availability of Capital
     In this analysis,  bulk plants are considered as separate profit
centers subject to "stand alone" economics in  order to determine  their
ability to secure the capital  necessary to Install  vapor control
equipment.  To assist the analysis, the bulk plant models and the
model vapor control systems are used to estimate the number  of bulk
plant closures likely   under each of the three control  options for
each of the three cost  scenarios.  As was the  case for bulk  terminals,
the inability of these  model facilities to incur and to  service the
incremental debt associated with vapor control  was translated into
potential closures in the actual bulk plant population.

     a.  Capital Requirement
     The capital required to comply with the vapor control regulations
can represent a substantial part of existing net investment  of the bulk

-------
                           TABLE VI1.2
               DISTRIBUTION OF GASOLINE BULK PLANTS
           SUBJECT TO THE  PROPOSED VAPOR CONTROL OPTIONS
Daily
Gasoline Throu
Thousand

ghput
Cubic
Number of
Bulk Plants

Percent
of Total

Gallons Meters
>3
3-8
8-17
<17
>io
10-30
30-65
<65
4,080
8,750
1,160
260
29%
61%
8%
2%
Total                             14,250              100%
Source: Arthur D. Little, Inc.
                              VII.5

-------
plant models.   In order to  comply with  Option  1  regulations, vapor
control  investment could equal  3%-7%  of the  current  net  investment of
the small  bulk plant model  and  l%-3%  of the  net  investment of the
larger model  (Table VII.3).   Compliance with Option  2, which requires
stricter vapor control  than Option 1, requires a capital outlay of as
much as 40% of the net plant investment of the small  bulk plant model
and 18% of the larger facility.   Option 3, which requires the greatest
amount of gasoline vapor reduction, requires the greatest amount of
additional capital.  Vapor  control investment  under  this option can
exceed 100% of the net investment at  the small model  and equal 20% to
85% of the net investment of the larger facility.  The substantial
capital investment required for Option  3 compliance  will make it very
difficult for bulk plant operators to service  this incremental debt,
even if the necessary funds can be secured.

     b.  Approach
     The methodology used for calculating the  number of  expected bulk
plant closures resulting from an inability to  obtain capital is the  same
as that used in the bulk terminal analysis.  The commercial lending  rules
used in this analysis are the same as those  presented in Table VI.5
and Figure VI.2.  However,  because the  bulk  plant industry has
historically been more leveraged than the bulk terminal  industry,  has
frequently used non-conventional financing methods,  and  is largely
comprised of jobbers—many  of whose personal finances are virtually
indistinguishable from those of their bulk plants, we have assumed that
20% of the bulk plant operators failing to secure commercial loans
because their total debt obligation exceeds  50%  of after-tax cash  flow,
but is less than 100%, are  able to obtain non-standard commercial
loans through established banking ties  or by pledging personal assets.
Another 20% of these prospective borrowers are assumed to obtain non-
commercial financing, e.g., using personal funds, liquidating personal
assets, or borrowing from relatives and friends.  However, if the  pro-
posed debt obligation exceeds 100% of the projected  cash flow, no
commercial loans of any sort will be made.  Non-commercial loans would
                                 VII.6

-------
                                                                                             TABLE  VI 1. 3
                                                                  ESTIMATED 1978 VAPQR CONTROL CAPITAL  REQUIREMENT  OF BULK  PLANTS
                                                                  --        (Thousand Dollars)
BULK PLANT1
Pre-Vapor Control Net
Plant Investment
Vapor Control
Investment
Balance
Incoming
Trucks Only
57.0
4.2
	 LOW
Balance In-
coming & Out
going Trucks
57.0
23.0
THROUGHPUT MUU
Primary Control System
Refrigeration Incineration
57.0
92.2
57.0
48.3
t L 	
Primary System
Refrigeration/
Incineration
«
5*7.0
117.4
With Stand-By
Incineration/
Incineration
57.0
73.6
Balance
Incoming
Trucks Only
143.0
4.2
	 M 1 (i H
Balance In-
coming & Out
going Trucks
143.0
25.7
1HROU6HPUT M 0 I
Primary Control System
Refrigeration Incineration
143.0 143.0
94.9 51.0
) E L 	
Primary System
Refrigeration/
Incineration
143.0
120.1
M1th Stand- By
Incineration/
Incineration
143.0
76.2
Vapor Control  Investment
 as a Percent  of Pre-
 Control  Net Investment
   40%
                162%
              ,85*
                                             206%
                                                           129%
                                                                                              18%
                                                                                                            66S
                                                                                                                          36%
                                                                                                                                          841
                                                                                                                                                        531
BULK PLANT
Pre-Vapor Control  Net
 Plant Investment             57.0          57.0

Vapor Control Investment      4.2          10.7

Vapor Control Investment
 as a Percent of Pre-
 Control  Net Investment        7*           19*
                57.0

                79.8



                140%
              57.0

              36.0
               63t
                57.0

               105.1



                184%
              57.0

              61.2



              107X
                   143.0

                     4.2



                      3*
              143.0

               13.0



                 9%
              143.0

               82.1



                57S
              143.0

               38.2



                27%
                143.0

                107.4



                  75*
              143.0

               63.5



                44%
BULK PLANT
Pre-Vapor Control Net
 Plant Investment            57.0

Vapor Control Investment      1.7

Vapor Control Investment
 as a'Fercent of Pre-
 Control Net Investment        3%


 NOJC costs for top loading.
  57.0

   3.8



    7*
57,0

73.0



128%
57.0

29.1



 51*
57.0

98.2



172*
57.0

54.4



95%
143.0

  1.7



   1*
143.0

  4.9



   3%
143.0

 74.0



  52%
143.0

 30.1



  2U
143.0

 99.3



  69%
143.0

 55.4



  39%
2Houston-Ga1veston costs for top loading.        Colorado APCD costs for top loading.
Source: Appendix C and Environmental  Protection Agency cost estimates

-------
still  be possible for up to 20% of these  applicants  failing the lending
criteria if personal, relatives',  or friends'  funds  were  available at
very low interest rates or if an operator accepted a smaller take-home
pay.  Admittedly, these percentages probably  have leakage and they,  in
effect,  represent a form of cross-subsidy.   However,  this modification
to the lending model is necessary  in order to recognize the nature of
the bulk plant industry where many facilities are very small—being
only one- or two-man operations.

     Discussions with the National  Oil  Jobbers Council  (NOJC) and local
jobber and petroleum marketer associations indicated that many bulk
plants currently have 50% to 75% of their current plant investment
under mortgage.  This roughly corresponds to  a debt-to-equity ratio  of
between 1 ;l and 3:1.  Pre-control  debt  obligation as a percent of cash
flow was calculated for the bulk plant  models assuming that 60% of net
plant investment was mortgaged for 20 years at a 9%  annual interest
rate.    The result of this calculation  was that debt obligations
equalled 21% to 23% of cash flow,  or that cash flow  covered debt obli-
gations by a ratio of about 4:1 (Table  VII.4). Total  debt as a percent
of cash flow was then calculated assuming that 100%  of the incremental
vapor control investment, required for  each cost scenario and for each
                                                                       2
control option, was borrowed for 5 years  at an 11% annual interest rate.
Under this condition, the total debt obligation ranged from 25% to over
100% of cash flow for the small bulk plant model and from 22% to 60% of
cash flow for the larger model. Because  small bulk  plants, which com-
prise the majority of the 1978 bulk plan  population, are  the most
 Borrowing terms currently available if financing a  bulk  plant  proto-
 type at its book value.
2
 Bulk plant operators are not financially strong  enough to obtain  the
 same borrowing terms, both in duration and interest rate, as the  bulk
 terminal operators.
                                VII.3

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                                                                                            TABLE  VII. 4
»— 1


BULK PLANT1
Pre-Vapor Control
Post-Vapor Control
BULK PLANT2
Pre-Vapor Control
Post-Vapor Control
BULK PLANT3
Pre-Vapor Control
Post-Vapor Control


Balance
Incoming
Trucks Only

21%
31%

21%
311

21*
24%


Balance In-
coming & Out
going Trucks

21%
61%

21*
42%

21%
29%
TERM DEBT AS


Refrigeration Incineration

2U 21%
> 100% 96%

21% 21%
> 100% 83%

21% 21*
> 100% 58%
A PERCENT OF AFTER-TAX CASH FLOW
E L 	
Primary System
Refrigeration/
Incineration

21%
> 100%

21%
> 100%

21%
> 100%

With Stand-By
Incineration/
Incineration

21%
> 100%

21%
> 100%

21%
> 100%
AT BULK PLANTS

Balance
Incoming
Trucks Only

23%
24%

23%
24%

23%
22%


Balance In-
coming i Out
qolng Trucks

23%
36%

23%
29%

231
24%




Primary Control System
Refrigeration

23%
58%

23%
55%

23%
53%
Incineration

23%
' 46*

23*
41*

23*
25*


Primary System
Refrigeration/
Incineration

23%
62%

23S
60S

23%
59*


With Stand-By
Incineration/
Incineration

23*
54*

23*
50%

23*
48%
 NOJC costs
 Houston-Galveston costs
3Colorado APCD costs
So"Te: Appendix  f

-------
severely impacted  according to the above  analysis, a  substantial
number of closures are expected.

     c.  Closure Summary
     The number of bulk plant closures  expected to  result  from an
inability to secure capital  varies significantly by control option and
cost scenario.  No bulk plant closures  are likely to occur because of
Option 1, which has the smallest capital  requirement of the three con-
trol options (Table VII.5).   Option 2 is  expected to cause approximately
1,690 facilities, or 12% of all gasoline  bulk plants,  to close if the
NOJC, or most expensive, cost scenario  is  assumed.  No closures are
expected for Option 2 for the other two cost scenarios.  Because
Option 3 compliance requires the greatest amount of capital,  it is the
option expected to cause the largest number of bulk plant  closures.  The
number of bulk plant closures expected  as  a result  of  Option  3 ranges from
1,060 for a Colorado APCD incineration  unit to 8,990 for a NOJC refri-
geration/incineration system.  The bulk plant closures identified here
will be subtracted from the total number  of bulk plants subject to
possible closure to avoid possible double-counting.  Only  those
facilities having adequate access to capital  are subject to possible
closure resulting from insufficient profitability.
2.  Insufficient Profitability
     Many of the bulk plants having access to adequate capital  may  still
close because of vapor control economics.   Bulk plants failing  to
achieve a minimum level  of profitability after vapor control  equipment
is installed are assumed to close.  Bulk plants will  continue operating
as long as the bulk plant operators can meet current liabilities, i.e.,
operating expenses (including salaries) and debt obligations  (principal
and interest).  Bulk plants would continue to operate under these con-
ditions even if no return on equity investment was earned.   Bulk
plant operators having limited business alternatives for their  equity
investment or believing that profitability would increase in  the future
as other facilities close would remain in business.
                                 VII.10

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                                                TABLE VI 1.5
                         BULK PLANT CLOSURES BECAUSE OF INACCESSIBILITY OF CAPITAL
                         OPTION 1

                         Balance
                         Incoming
                       Trucks Only
                                                  CONTROL   S.TRATEGY
          OPTION 2

        Balance In-
        coming & Out-
        going Tracks
                                      OPTION 3
               Primary Control  System

             Refrigeration  Incineration
                           Primary System With Stand-By
                          Refrigeration/  Incineration/
                           Incineration   Incineration
NOJC Cost Scenario
0
1,690
8,930
6,080
8,990
8,880
Houston-Galveston Cost
 Scenario
                            8,890
                               4,370
                             8,960
                               8,820
Colorado APCD 'Cost
 Scenario
             0
                 8,870
              1,060
               8,950
                8,820
Source: Arthur D. Little, Inc.

-------
     a.  Approach
     The methodology employed to calculate bulk plant closures is the
same as that used in analyzing bulk terminals.  Gasoline breakeven
throughputs were calculated for the bulk plant models under base case
conditions (Table VII.6).  Facilities operating below this breakeven
volume are assumed to close due to reasons other than the vapor control
options.  All bulk plants operating above this throughput would remain
in operation.  If the bulk plant models must cover higher operating
expenses or larger loan payments because of vapor control, the gasoline
breakeven throughput will increase.  Some bulk plants,  once operating
above breakeven volumes, would now operate below these  adjusted break-
even volumes.  The example of this methodology shown  in  Figure  VI.3
for bulk terminals is also appropriate here for bulk  plants.

     The incremental  gasoline throughput necessary to cover all  vapor
control costs is shown in Table VII.6.  A summary of  the changes in
profitability and gasoline tariff of the bulk plant models under the
various control options and cost scenarios is presented in Table VII.7.
In addition to the larger bulk plants, an estimated 30% of the small
bulk plants will be able to pass through the entire cost of vapor
control.  These facilities are partially shielded from  the full  force
of competitive pressure due to transportation economics, i.e., the
incremental cost per gallon of full  vapor control  pass  through  is less
than the transportation cost of a marginal gallon of  gasoline irovV-d
into the bulk plant's service area.  Other small bulk plants, however,
will realize an increase in their breakeven throughput  as a result of
partially absorbing the costs of vapor control.  Their  gasoline tariff
increase is limited to the same per gallon increase as  the larger
facilities and they will, therefore,  experience a decline in margin and
an increase in breakeven throughput.

     The product volumes of the bulk  plants which closed because they
lacked the capital necessary to install vapor control equipment will be
redistributed across the remaining bulk plant population.  This
                                VII. 12

-------
                                                                                             TABLE VII.6
H— 1
1 — t
CO
Gasol ine Breakeven
Throughput {Pre-
Vapor Control )
Incremental Gasoline
Throughput Required
Due to Vapor Control
Capital and Operating
Costs
Gasoline Breakeven
Throughput (Post-
Vapor Control)
Percent Increase Over
Pre-Control Throughput
BULK PLANT3
Gasoline Breakeven
Throughput (Pre-
Vapor Control)
Incremental Gasoline
Throughput Required
Due to Vapor Control
Capital and Operating
Costs
Gasoline Breakeven
Throughput (Post-
Vapor Control)
Percent Increase Over
.:re-Control Throughput
SULK PLANT4
*a saline Breakeven
Throughput (Pre-
Vapor Control )
Incremental Gasoline
Throughput Requi red
Due to Vapor Control
Capital and Operating
Costs
Gasoline Breakeven
Throughput (Post-
Vapor Control)
Percent Increase Over
Pre-Control Throughput
CHANGE IN DAILY GASOLINE BREAKEVEN THROUGHPUT AT BULK PLANTS BECAUSE OF VAPOR CONTROL COSTS1
(Thousand Gallons)
.... ,.„. — 	 — LOW THROUGHPUT MODEL 	 • — • — • 	 — — 	 	 • H I 0 || THROUGHPUT M 0 D E 1
Balance Balance In- Balance Balance In- pHmar., Control 5rtcn1 Primary System With Stand-By
Trucks Only going Trucks Refrigeration Incineration Incineration Incineration Trucks Only going Trucks Refrloeration Incineration Incineration Incineration
3.2 3.2 3.2 3.2 3.2 3.2 16.1 16.1 16.1 16.1 16.1 16.1
0.1 0.5 2.7 1.4 3.4 2.1 0.0 0.0 0.0 0.0 0.0 0.0
3.3 3.7 5.9 4.6 6,6 5.3 16.1 16.1 16.1 16.1 16.1 16.1
3% 15% 84JI 44% >100% 66* 0% 0% OX 0% 0% 0*
3.2 3.2 3.2 3.2 3.2 3.2 16.1 16.1 16.1 16.1 16.1 16.1
O.T 0.2 2.4 1.1 3.1 1.8 0.0 0.0 0.0 0.0 0.0 0.0
3.3 3.4 5.6 4.3 6.3 5.0 16.1 16.1 16.1 16.1 16.1 16.1
3* 62 75X 3« 97% 56% OX 0* OX « OS 0*
3.2 3.2 3.2 3.2 3.2 3.2 16.1 16.1 16.1 16.1 16.1 16.1
°-° 0.04 2.2 0.9 2.9 1.6 0.0 0.0 0.0 0.0 0.0 0.0
3'2 3'24 5-* «•' 6-1 4-8 16.1 16.1 16.1 u.l 16.i ,6 ,
<* 1* 69* 28i 91% 50« 0* 0% 0% 0% Q% OS
 Assuming competitive  cost  pass through.





Source:  Arthur D.  Little,  Inc.
NOJC costs.
                     Houston-Galveston  costs.
                                                     Colorado APCO  costs.

-------
                                                                                              TABLE  VI 1.7

                                                                              liULK PLANT ROI  AMD GASOLINE TARIFF IMPACTS

                                             LOW   THROUGHPUT    MODEL
BULK PLANT1
Post-Vapor Control  ROI

Percent Increase/
 (Decrease)  Over Pre-
 Control  ROI2
                           Balance     Balance  In-     p.,..,-., control  Svstem     Primary System With Stand-By
                           Incoming   coming &  Out     Primary uintroi  Astern—  Refrigeration/  Incineration/
                         Trucks Only  going Trucks   Refrigeration   Incineration   Incineration   Incineration
 17.3*
(15.7*)
Post-Vapor Control
 Gasoline Tariff ($/G«l)     .0322

Percent Increase/
 (Decrease) Over Pre-
 Control  Gasoline Tariff    (  0.61)
BULK PLANT
Post-Vapor Control  ROI

Percent Increase/
 (Decrease) Over Pre-
 Control ROIZ
 17.3%
(15.71)
Post-Vapor Control
 Gasoline Tariff ($/Ga1)     .0322

Percent Increase/
 (Decrease) Over Pre-
 Control  Gasoline Tariff    ( 0.6%)
BULK PLANT

Post-Vapor Control  ROI

Percent Increase/
 (Decrease) Over Pre-
 Control ROI2
 19.2%
( 6.8*)
Post-Vapor Control
 Gasoline Tariff ($/Gal)    .0321

Percent Increase/
 (Decrease) Over Pre-
 Control Gasoline Tariff   ( 0.9*
  7.81



(62.11)


  .0328



  1.41




  13.21



 (35.8*)


  .0323



 ( 0.11)




  17.75



 (14.1?,)


  .0320



 ( 1.11)
Negative
                            .0353
                            9.11
Negative
                            .0349
                            7.8%
                            Negative
                            .0346
                            1.7%
Negative







.0347



7.0%




1.2%



(94.3",)


.0342




5.6S




10.11



(50.7X)


.0379



17.01
Negative
                             .0364
                                                         12.5%
Negative
                                                         .0360
                                                         11.1*
                             Negative
                                                         .0356
                                                         10.0*
Negative
               .0357
                                            10.11
Negative
                                                                        .0352
                                                                        8.71
                                            .0349
                                                                        7.7%
 NOJC costs.
                   2
                                                                                                     	HIGH   THROUGHPUT   MOD
                                                                                                       &alflnc£ In-
                                                                                                       comlngiOut   Mmf*  C°ntro1 S/5tem
                                                                                          Trucks Only  going  Trucks  Refrigeration  Incineration
                                                                                                                                    E L 	
                                                                                                                                    Primary System H1th Stand-By
                                                                                                                                    Refrigeration/ Incineration/
                                                                                                                                    Incineration  Incineration
20.51



 HC3


.0174



(1.01)




20.51



 NC


.0174



(1.01)
20.51



 NC


.0180



2.61




20.51



 NC


.0175



(0.21)
                    Pre-control  ROI Is 20.6%.   ROI  Is a simple before-tax  return on net plant Investment.
20.51



 NC


.0205



16.91




20.51



 NC


.0200



14.31
20.51



 NC


.0198



13.01




20.51



 NC


.0194



10.4%
 No Change - assumes full  pass through of costs  for this model.


Source:  Appendix G
                                             Houston-Galveston costs.
               Negative             20.51         20.51         20.51         20.5%



                                     NC            NC            NC            NC


                                    .0173         .0172         .0197         .0190



                                    (1.6%)        (2.0%)        12.4%          8.4%




                        Colorado APCD costs
20.51



 NC


.0216



23.11




20.51



 NC


.0211



20.5%




20.51



 NC


.0208



18.51
20.51



 NC


.0208



18.71




20.51



 NC


.0204



16.11




20.5%



 NC


.0200



14.1%

-------
increase in product throughput will  assist the  facilities under con-
sideration here to achieve their new breakeven  volumes.  However, the
amounts of this redistribution for Options 1  and  2  are  rather  insigni-
ficant since the incremental  throughput of only one of  the  six cost
scenarios is greater than zero and even that  is  less than  700
gallons/day.  The additional  product volumes  for  Option 3 range from
under 500 gallons/day to over 10,000 gallons/day.  As was the  case
for Options 1  and 2, the incremental volumes  resulting  from the low
end of this range  can be regarded as insignificant.  Volume adjust-
ments caused by the high end of this range, however, are quite
significant.  The redistribution of this product  will  greatly  reduce
the number of expected bulk plant closures caused by insufficient
profitability, but it also is expected to alter many of the basic
attributes which have historically characterized  the bulk plant
industry.  Considering the magnitude of the closures and the redis-
tributed volumes described above, a substantially new and different
secondary storage industry is likely to emerge.

     b.  Closure Summary
     The number of bulk  plants able to obtain capital but having  to
close  because of insufficient profitability is shown in Table VII.8.
The  number  of closures  varies  by  control  option  and cost scenario.
Closures  resulting from Option  1  are estimated to  be 130 for the NOJC
and  Houston-Galveston cost scenarios and  zero  for  the  Colorado APCD
cost scenario.   Closures resulting  from Option 2 range  from 50 to 530
 facilities, while  Option 3 compliance  is  expected  to cause  between 600
and  1,300  bulk  plants to close.   A  summary of  all  bulk  plant  closures
caused by vapor control  economics,  as  well as  the  number of remaining
bulk plants installing  vapor  control equipment,  is shown in Tables VII.9
through VI1.11.
                               VI 1.15

-------
                                               TABLE VI1.8
                         BULK PLANT CLOSURES BECAUSE OF INSUFFICIENT PROFITABILITY
NOJC Cost Scenario
  OPTION 1

  Balance
  Incoming
Trucks Only

      130
                                                 CONTROL    STRATEGY
                                       OPTION 2
Balance In-
coming & Out-
golng Trucks

      530
                                        OPTION  3
                                                                                   Primary  System with Stand-By
                                                                                   Refrigeration/    Incineration/
                                                       Refrigeration   Incineration   Incineration     Incineration
Primary Control  System
   1,040
900
1,300
800
Houston-Galveston Cost
 Scenario                    130
                    240
                         920
                  890
             1,180
                  690
Colorado APCD Cost
 Scenario
                     50
                         840
                1,010
             1,100
                  610
Source: Arthur D.  Little,  Inc.

-------
                                                TABLE  VI I.9

                               BULK PLANT CLOSURES BECAUSE  OF VAPOR  CONTROL
                             ECONOMICS1  RESULTING FROM THE  NOJC  COST SCENARIO
                         OPTION  1

                         Balance
                         Incoming
                       Trucks  Only
                                                  CONTROL   STRATEGY
             OPTION 2

           Balance In-
           coming & Out-
           going Trucks
                                      OPTION  3
               Primary Control  System

             Refrigeration  Incineration
                           Primary System with  Stand-By
                           Refrigeration/   Incineration/
                            Incineration     Incineration
Petroleum Bulk Plants
 Subject to Vapor
 Control
14,250
14,250
14,250
14,250
14,250
14,250
Bulk Plant Closures
 Because of Inaccessi-
 bility of Capital
               1,690
                 8,930
                6,080
                8,990
                 8,880
Bulk Plant Closures
 Because of Insufficient
 Profitability
   130
   530
 1,040
   900
 1,300
   800
Remaining Bulk Plants
 Installing Vapor
 Control
1
14,120
12,030
 Assuming competitive cost pass through.

Source: Table VII.5 and VII.8
 4,280
 7,270
 3,960
 4,570

-------
                                                        TABLE  VII.10
                                       BULK PLANT CLOSURES BECAUSE  OF VAPOR  CONTROL
                               ECONOMICS1  RESULTING FROM THE HOUSTON-GALVESTON  COST  SCENARIO
        Petroleum Bulk Plants
         Subject to Vapor
         Control
                                 OPTION 1

                                 Balance
                                 Incoming
                               Trucks Only
14,250
                                                         CONTROL    STRATEGY
             OPTION 2     	

           c^ngYSut-    Primary Control  System
           going Trucks   Refrigeration  Incineration
                                     OPTION 3
14,250
14,250
14,250
                                            Primary  System  With  Stand-By
                                           Refrigeration/    Incineration/
                                            Incineration     Incineration
14,250
14,250
•_,       Bulk Plant Closures
00        Because of Inaccessi-
         bility of Capital           0
                               8,890
                                4,370
                               8,960
                                8,820
        Bulk Plant Closures
         Because of Insufficient
         Profitability
   130
   240
   920
   890
 1,180
   690
        Remaining Bulk Plants
         Installing Vapor
         Control
14,120
14,010
 4,440
 8,990
 4,110
 4,740
        1
         Assuming competitive cost pass through.

        Source: Table VI1.5 and VI1.8

-------
                                                TABLE VI1.11
                               BULK  PLANT  CLOSURES  BECAUSE OF VAPOR CONTROL
                         ECONOMICS1  RESULTING  FROM  THE  COLORADO APCD COST SCENARIO
Petroleum Bulk Plants
 Subject to Vapor
 Control
                         OPTION  1

                         Balance
                         Incoming
                       Trucks  Only
14,250
                                                  CONTROL   STRATEGY
             OPTION 2

            Balance In-
           coming & Out-
           golng Trucks
14,250
                                      OPTION  3
               Primary Control  System

             Refrigeration  Incineration
14,250
14,250
                            Primary System  With Stand-By
                           Refrigeration/    Incineration/
                            Incineration     Incineration
14,250
14,250
Bulk Plant Closures
 Because of Inaccessi-
 bility of Capital           0
                               8,870
                                1,060
                               8,950
                                8,820
Bulk Plant Closures
 Because of Insufficient
 Profitability              0
                  50
                   840
                1,010
                1,100
                   610
Remaining Bulk Plants
 Installing Vapor
 Control
14,250
1
14,200
 Assuming competitive cost pass through.
 4,540
12,180
 4,190
 4,820
Source: Table VII.5 and VII.8

-------
D.  BULK PLANT IMPACTS
     In addition to bulk plant closures,  the economic  impacts of  vapor
control on the bulk plant industry are  expressed in terms  of the  employ-
ment displaced by these closures and the  monetary cost of  installing,
financing, and operating vapor control  systems  at all  the  remaining
bulk plants.

1.  Employment Impact
     At bulk plants, the number of employees displaced by  the  proposed
vapor control options ranges from zero  to 43,700 (Table VII. 12).   These
numbers were calculated by multiplying  the average number  of employees
per large and small bulk plant times the  number of expected  closures of
each type.  Approximately 550 workers,  or less  than 1% of  the total
employment at gasoline bulk plants, are displaced by closures caused by
Option 1.  Up to 9,400 workers, or 13%  of the worker population,  are
displaced by closures caused by Option  2  compliance, while as many as
43,700 workers, or 61% of those employed  at gasoline bulk  plants, are
likely to be displaced by Option 3.

2.  National Cost of Compliance
     The installation and operation of  vapor control systems at  bulk
plants over the estimated 10-year useful  life of the equipment may cost
as much as $750 million or produce a savings of up to  $23  million,
depending upon the control  option and the cost  scenario selected
(Table VII.13).  A cost savings is possible because the Colorado  cost
scenario requires less than half the capital investment of the  other
systems but still produces the same recovery credit as the more  expen-
sive systems.  Depending on the set of costs examined, Option  1
compliance ranges from a $23 million savings to a cost of  $37  million;
Option 2 compliance ranges from a savings of $6 million to a cost of
$376 million; and Option 3 compliance costs between $465 and $750
million.  A more detailed breakdown of all control system  costs  is
presented in Tables VII.14 through VII.16.
                               VII.20

-------
                                               TABLE VII.12
EMPLOYMENT IMPACT
NOJC COST SCENARIO
Bulk Plants Closed
Because of Vapor
Control Economics
Estimated Employment
At Closed Bulk Plants
HOUSTON-6ALVESTON COST

OPTION 1
Balance
Incoming
Trucks Only
130
550
SCENARIO
Bulk Plants Closed
Because of Vapor
Control Economics 130
Estimated Employment
At Closed Bulk Plants 550
COLORADO APCD COST SCENARIO
Bulk Plants Closed
Because of Vapor
Control Economics
Estimated Employment
At Closed Bulk Plants
0
0
AT BULK PLANTS
r f
l> V.
OPTION 2
Balance In-
coming & Out-
going Trucks
2,220
9,440
240
1,020
50
210
BECAUSE OF VAPOR
) N T
R 0 L S T
Primary Control
Refri
9,
42,
9,
41,
9,
41,
CONTROL
R A
T E
System
ECONOMICS
Gv
I
OPTION 3


Primary System
Oii-Fi-i
I\C 1 1 1
geration Incineration Inci
970
370
810
690
710
270
6,
29,
5,
22,
2,
8,
980
660
260
360
070
800
10
43
10
43
10
42
geration/
neration
,290
,730
,140
,100
,050
,710


With




Stand-By
Incineration/
Incineration
9,
41,
9,
40,
9,
40,
680
140
510
420
430
080

Source:  Arthur D.  Little,Inc.

-------
                                                       TABLE VI1.13
ro
ro
TOTAL COST OF VAPOR
NOJC COST SCENARIO
Bulk Plants Installing
Vapor Control Equip-
ment
Total, Vapor Control
Cost1
HOUSTON -GALVESTON COST

OPTION 1
Balance
Incoming
Trucks Only
14,120
36.9
SCENARIO
Bulk Plants Installing
Vapor Control Equip-
ment 14,120
Total Vapor Control Cost 36.9
COLORADO APCD COST SCENARIO
Bulk Plants Installing
Vapor Control Equip-
ment 14,250
Total Vapor Control Cost (22. 7)2
(Million 1
p
OPTION 2
Balance In-
coming & Out-
going Trucks
12,030
375.5
14,010
154.8
14,200
(6.5)*
CONTROL AT BULK
978 Dollars)
0 N T R 0 L S
PLANTS
T R A T E G Y
OPTI
Primary Control System
Refrigeration
4,280
636.9
4,440
569.3
4,540
528.6
Incineration
7,270
651.3
8,990
619.7
12,180
696.8

ON 3
Primary System
Refrigeration/
Incineration
3,960
747.3
4,110
698.3
4,190
656.0


With Stand-By
Incineration/
Incineration
4,570
589.5
4,740
514.0
4,820
465.2
         Vapor control  costs include capital  charges,  financing cost and  operating expenses over the useful life of the
        -equipment. All future cash streams have been  discounted to present  value using a discount rate of 10%.
         Negative cost or net savings because the net  present value of the  gasoline  recovery credit exceeds the net
         present value of the capital, financing and operating expenses.

        Source: Tables VII.14 and VI1.16

-------
                                                       TABLE  VI 1.1.4
oo
       Capital  Investment
                2
       Financing
       Operating Expense

       Recovery Credit
                        3
       Total  Vapor Control
       Costs
COST OF VAPOR CONTROL AT BULK PLANTS,
RESULTING FROM THE NOJC COST SCENARIO

OPTION 1
Balance
Incoming
Trucks Only
60.0
13.3
26.0
(62. 4)4
(Million 1
OPTION 2
Balance In-
coming & Out-
going Trucks
280.9
62.3
120.7
(88.4)
978 Dollars)
0 N T R 0 L S
T R A T E G Y
OPTI
Primary Control System
Refrigeration
398.0
88.3
279.5
(128.9)
Incineration
355.1
78.8
217.4

ON 3
Primary System
Refrigeration/
Incineration
468.4
103.9
290.7
(115.7)


With Stand-By
Incineration/
Incineration
339.8
75.4
174.3
36.9
375.5
636.9
651.3
747.3
589.5
        All  future cash streams  discounted to  present  value  using  a  discount rate of 10%.
       2                                                                        T
        Interest charges associated with vapor control  debt  are  incurred over a 5-year period and discounted to present
        value.
       3
        Operating expenses  and recovery credits are  realized over  the  10-year useful life of the vapor control system
        and  discounted to present value.
        Represents a negative cost or a savings equivalent to the  present value of the gasoline vapor which otherwise
        would have been discharged into the atmosphere if a  vapor  recovery  system was not utilized.
       Source:  Arthur D.  Little,  Inc.  estimates  based upon  EPA  cost data.

-------
                                                       TABLE  VI1.15
ro
Capital  Investment

         2
Financing

                 3
Operating Expense
               3
Recovery Credit

Total Vapor Control
 Costs
COST OF VAPOR CONTROL AT BULK PLANTS ,
RESULTING FROM THE HOUSTON -GALVESTON COST SCENARIO

OPTION 1
Balance
Incoming
Trucks Only
60.0
13.3
26.0
(62.4)4
(Million 1
r
OPTION 2
Balance In-
coming & Out-
going Trucks
153.1
34.0
66.0
(98.3)
978 Dollars)
0 N T R 0 L S
T R A T E
Primary Control System
Refrigeration
357.6
79.4
266.1
(133.8)
Incineratl
- 326.5
72.5
220.7
R Y
U I
OPTION 3
Primary System

on Incineration
434.8
96.5
286.2
(119.2)


With Stand-By
Incineration/
Incineration
293.4
65.1
155.5
                                  36.9
154.8
569.3
619.7
698.3
514.0
       1
        All  future cash streams  discounted to present value  using  a  discount  rate of 10%.
        Interest charges associated with vapor control  debt  are  incurred  over a  5-year period and discounted to
        present value.
       o
        Operating expenses and recovery credits are realized over the  10-year useful life of the vapor control system
        and discounted to present value.

        Represents a negative cost or a savings equivalent to the present value  of the gasoline vapor which otherwise
        would have been discharged into the atmosphere  if a  vapor recovery system was not utilized.
       Source: Arthur D. Little,Inc.  estimates  based upon  EPA cost  data

-------
                                                       TABLE VII.16
ro
wi
        Capital  Investment

                 2
        Financing


        Operating Expense

                       3
        Recovery Credit


        Total  Vapor Control
         Costs
                                          COST OF VAPOR CONTROL AT BULK PLANTS
                                      RESULTING FROM THE COLORADO APCD COST SCENARIO

OPTION 1
Bal ance
Incoming
Trucks Only
24.2
5.4
10.5
(62. 8)4

OPTION 2
Balance In-
coming & Out-
going Trucks
56.0
12.4
24.3
(99.2)
0 N T R 0 L S
T R A T E G Y
OPTI
Primary Control System
Refrigeration
332.8
73.9
258.1
(136.2)
Incineration
355.9
79.0
261.9
__

ON 3
Primary System
Refrigeration/
Incineration
412.9
91.6
272.2
(120.7)


Uith Stand-By
Incineration/
Incineration
263.5
58.5
143.2
—
(22.7)
(  6.5)
528.6
696.8
656.0
465.2
          11  future.cash streams  discounted  to  present value using a discount rate of 10%.
        rt
         Interest charges associated with vapor control debt are  incurred voer a 5-year period and discounted to

         present value.

        ^Operating expenses and recovery credits are  realized over the 10-year useful life of the vapor control system

         and  discounted  to present value.

        Represents a negative cost or a savings equivalent to the present value of the gasoline vapor which otherwise
         would have been discharged into the atmosphere if a vapor recovery system was not utilized.
        Source: Arthur D. Little, Inc.  estimates  based  upon  EPA  cost data

-------
APPENDIX   A
MARKET AUDIT OF BULK
 STORAGE FACILITIES
         A.I

-------
TABLE A.I
Thousand Cu. Meters
Thousand Barrels
MARINE TERMINALS
Majors & Semi -Majors
Independents
PIPELINE TERMINALS
Majors & Semi -Majors
Independents
TOTAL
% Total
Excludes crude and
Source: Bureau of Ce
Independent
BULK TERMINALS AND STORAGE CAPACITY IN THE U.S. - 19781
RANGE Or STORAGF TAPAflTY ^ 	 	 	
< 32 32-95 95-159 > 159 PERCENT GASOLINE
PERCENT OF TOTAL TOTAL AS A PERCENT
<200 201-600 601-1000 >1000 TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY TOTAL CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Barrels Cu. Meters Barrels
232 199 78 78 587 33% 54,417 342,273 43% 22,739 143,367 42%
231 60 33 48 372 22% 28,026 181,502 28% 6,992 43,979 25*
253 213 84 33 583 33% 28,261 177,758 23% 13,438 84,522 48*
118 62 20 9 209 12% 10,999 69,183 9% 3,886 24j440 35*
834 534 215 168 1,751 100% 122,534 770,716 100% 47,109 296,308 38%
48% 30% 12S 10% 100%
product storage at refineries
nsus, 1972 Census of Wholesale Trade; U.S. Army Corps of Engineers, Port Series; National Petroleum News, Factbook (1972-1978);
Liquid Terminals Association, 1978 Directory - Bulk Liquid Terminals and Storage Facilities; Industry contacts; Arthur D. Little, Inc.

-------
                                                                          TABLE A.g
                                                    BULK TERMINALS AND STORAGE CAPACITY  IN PADD  1-1978
Thousand Cu. Meters   < 32

Thousand Barrels      <200    201-600



MARINE TERMINALS

Majors & Semi-Majors    97       118


Independents           138        48
                              	 RANGE  OF STORAGE  CAPACITY

                               32-95        95-159    > 159
                                           601-1000   >1000    TOTAL
                                             46
                                             13
50     311
23     222
               PERCENT
               OF TOTAL
42%
30%
            TOTAL CAPACITY
          ThousandThousand
         Cu. Meters  Barrels
                     PERCENT
                     OF TOTAL         TOTAL
                     CAPACITY    GASOLINE CAPACITY
                                 Thousand  Thousand
                                Cu.  Meters  Barrels
38,702    243,432     61%
13,990     87,996
21%
           15,094     94,939
2,845     17,895
                                    GASOLINE
                                  AS A PERCENT
                                 TOTAL CAPACITY
                         39%
20%
PIPELINE TERMINALS
Majors & Semi -Majors
Independents
TOTAL
% Total
% U.S.
Excludes crude and
82
19-
336
45%
40%
product
51
14
231
31%
43%
36
..
95
13%
44%
10
„
83
11%
49%
179 24% 10,192
33 4% 1.287
745 100% 64,172
100%
43%
64,107 16%
8,098 2%
403,633 100%

52%
storage at refineries
Source: Bureau of Census, 1972 Census
Independent
Liquid
Terminals
of Wholesale
Association,
Trade; U.S.
Army Corps of Engineers, Port
1978 Directory - Bulk Liquid Terminals and
Series; National Pi
Storage Facilities
                                                                                                                      5,606     35,259


                                                                                                                        270      1,701
                                                                                                                     23,815    149,792
                                                                                                                            51%
                                                                                       55%


                                                                                       2 If.


                                                                                       37%

-------
                  TABLE A.3
BULK TERMINALS AND STORAGE CAPACITY IN PADD II - 1978
                                                     1
Thousand Cu. Meters < 32
Thousand Barrels <200
MARINE TERMINALS
Majors 4 Semi -Majors 12
Independents 20
PIPELINE TERMINALS
Majors & Semi -Majors 97
Independents 64
TOTAL' 193
% Total 45%
% U.S. 23%
Excludes crude and product
32-95
201-600
34
17
95
20
166
39%
31%
muc. vr JIUTW
95-159
601-1000
11
5
23
7
46
11%
21%
UL unrnuiii •- — — • — — — —
> 159 PERCENT
PERCENT OF TOTAL
>1000 TOTAL OF TOTAL TOTAL CAPACITY CAPACITY
Thousand Thousand
Cu. Meters Barrels
5 62 14% 3.725 23.431 15%
2 44 10% 2,636 16.580 10%
11 226 53% 13.056 82,121 52%
6 97 23% 5.738 36.088 23%
24 429 100% 25,155 158,219 100%
6% 100%
14% 25% 21%
TOTAL
GASOLINE CAPACITY
Thousand Thousand
Cu. Meters Barrels
1,788 11,247
538 3,386
5,484 34,491
2.066 12.992
9,875 62,115

21%
GASOLINE
AS A PERCENT
TOTAL CAPACITY
48%
20%
42%
23%
39%


storage at refineries
Source: Bureau of Census, 1972 Census
Independent Liquid
Terminals
of Wholesale
Association,
Trade; U.S. Army Corps of Engineers, Port Series; National Petroleum News, Factbook (19;
1978 Directory - Bulk Liquid Terminals and Storage Facilities;
Industry contacts; Arthur
72-1978);
D. Little, Inc.

-------
BULK TERMINALS AND STORAGE CAPACITY IN PADD III -1978*
Thousand Cu. Meters < 32
Thousand Barrels <200
32-95
201-600
nnnuc. ur aiuiv
95-159
601-1000
nuc v.wm.1 1 1 —————————
> 159
PERCENT
>1000 TOTAL OF TOTAL
PERCENT
OF TOTAL TOTAL
TOTAL CAPACITY CAPACITY GASOLINE CAPACITY
GASOLINE
AS A PERCENT
TOTAL CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Barrels Cu. Meters Barrels
MARINE TERMINALS
Majors & Semi -Majors 39
Independents 38
PIPELINE TERMINALS
Majors & Semi -Majors 60
Independents 12
TOTAL 149
% Total 54%
% U.S. 18%
Excludes crude and product
19
11
16
6
52
19%
10%
storage at
Source: Bureau of Census, 1972 Census
Independent Liquid
10
10
11
3
34
12%
16%
refineries
of Wholesale
13 81 29% 6
17 76 28% 9
7 94 34% 2
4 25 9% 1
41 276 100% 20
15% 100%
24% 16%

Trade; U.S. Army Corps of Engineers,
Terminals Association, 1978 Directory - Bulk Liquid Terminals
,455 40,600 32% 3,808 23,954
,218 57,982 46% 2,756 17,332
,881 18,118 14% 1,210 7,610
,514 9,522 8% 454 2,857
,068 126,223 100% 8,228 51,753

16% 17%

Port Series; National Petroleum News, Factbook (1972-
and Storage Facilities; Industry contacts; Arthur D.
59%
30%
42%
30%
41%



1978);
Little, Inc.

-------
                      TABLE A.5
BULK TERMINALS AND STORAGE CAPACITY IN PADD IV - 1978
Thousand Cu. Meters < 32
Thousand Barrels <200
PIPELINE TERMINALS
Majors & Semi-Majors 19
Independents _6
TOTAL 25
f
% Total 64%
% U.S. 3%
Excludes crude and product
Source: Bureau of Census, 1
Independent Liquid
32-95 95-159 > 159 PERCENT GASOLINE
. PERCENT OF TOTAL TOTAL AS A PERCENT
201-600 601-1000 >1000 TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY TOTAL CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Barrels Cu. Meters Barrels
10 2 - 31 79% 987 6,210 86% 612 3,850 62%
2 .... 8 21% 164 1,029 14% 62 390 38%
12 2 - 39 100% 1,151. 7,239 100% 674 4,240 59%
31% 5% -- 100%
2% 1% -- 2% 1% 1*
storage at refineries
972 Census of Wholesale Trade; U.S. Army Corps of Engineers, Port Series; National Petroleum News, Factbook (1972-1978);
Terminals Association. 1978 Directory - Bulk Liquid Terminals and Storage Facilities; Industry contacts, Arthur D. Little, inc.

-------
BULK TERMINALS AND STORAGE CAPACITY IN PADD V - 1978
                                                    1
Thousand Cu. Meters
Thousand Barrels
MARINE TERMINALS
Majors & Semi -Majors
Independents
PIPELINE TERMINALS
Majors & Semi -Majors
Independents
TOTAL
% Total
% U.S.
Excludes crude and
< 32
<200
84
35
11
20
150
57%
18%
product
Source: Bureau of Census; 1
Independent Liquid
32-95
201-600
26
14
8
21
69
26%
13%
storage at
972 Census
KAMlit Ur ilUKHbt iHrHlM
95-159 >159
601-1000 >1000
12 11
5 6
4
5
26 17
\0% 6%
12% 10%
refineries
of Wholesale Trade; U.S.
Terminal Association, 1978 Directory
i •
PERCENT
PERCENT OF TOTAL TOTAL
TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Barrels Cu. Meters Barrels
133 5U 5,534 34,810 46% 2,103 13,228
60 23% 3,012 18,945 25% 853 5,366
23 9% 1,145 7,202 10% 527 3,313
46 18% 2.297 14,447 19% 1,034 6,501
262 100% 11,988 75,403 100% 4,517 28,408
100%
15% 10% 10%

Armv Coros of Engineers, Port Series; National Petroleum News, Factbook (1972
- Bulk Liquid Terminals and Storage Facilities; Industry contacts; Arthur D.
GASOLINE
AS A PERCENT
TOTAL CAPACITY
38i
28%
46,
45°:.
38%



-1978);
Little, Inc.

-------
                                                                         TABLE A.7

Cubic Meters <151
Thousand Gallons <40
Majors & Semi -Majors 350
Independent
Marketer/Wholesalers 70
Jobbers 1,960
> TOTAL 2,380
oo
% Total 13%
BULK PLANTS AND STORAGE CAPACITY - U.S. TOTAL - 1978
	 	 	 „ RANfir nr iTfiUAfiF rAPAritv 	 	
152-568 569-1136 >1136 PERCENT
PERCENT OF TOTAL TOTAL
41-150 151-300 >300 TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Gallons Cu. Meters Gallons
3,330 260 170 ,4,110 22% 1,901 502,250 28% 1,097 289,920
620 60 20 770 4% 279 73,650 4% 176 46,540
10,850 860 90 13,760 74% 4,577 1,209,200 68% 2,748 725,920
14,800 1,180 280 18,640 100% 6,757 1,785,100 100% 4,021 1,062,380
79% 6% 2% 100%
GASOLINE
AS A PERCENT
TOTAL CAPACITY
58%
63%
60%
59%

Source:  Bureau of Census;  1972  Census of  Wholesale Trade; National 011 Jobbers Council; National  Petroleum News,  Factbook  (1972-1978);
        Industry contacts;  Arthur  0. Little,  Inc.

-------
                                                                 TABLE A.8
                                            BULK PLANTS AND STORAGE CAPACITY - PADD I - 1978
Cubic Meters <151
Thousand Gallons < 40
Majors & Semi -Majors 20
Independent
Marketer/Wholesalers 20
Jobbers 380
TOTAL 420
% Total 12%
% U.S. 18%
Source: Bureau of Census, 1972
— — — — — — r
152-568
41-150
450
170
2.020
2,640
75%
18%
Census of
mnuL ur 3 1 urv\ut
569-1136
151-300
50
20
320
390
11%
33%
Wholesale Trade
unrni
-------
                                                                  TABLE A.9
                                             BULK PLANTS  AND  STORAGE CAPACITY - PAOD  II - 1978
Cubic Meters <151
Thousand Gallons < 40
Majors & Semi -Majors 130
Independent
Marketer/Wholesalers 30
Jobbers 860
TOTAL 1 ,020
X Total 11%
X U.S. 43%
Source: Bureau of Census; 1972
152-568
41-150
1,310
340
5.870
7,520
85%
51%
Census of
nnnuc wr Jiunnu
569-1136
151-300
90
40
120
250
3%
21%
Wholesale Trade
>1136 PERCENT
PERCENT OF TOTAL TOTAL
>300 TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Gallons Cu. Meters Gallons
30 1,560 17X 533 140,720 20X 292 77,240
10 420 5% 149 39,250 5% 89 23,550
20 6,870 78X 2,009 530,700 75% 1,140 301,040
60 8,850 100% 2.691 710,670 100% 1,521 401,830
1% 100X
21% 47% 40% 38%
; National 011 Jobbers Council; National Petroleum News, Factbook (1972-1978);
GASOLINE
AS A PERCENT
TOTAL CAPACITY
55%
60%
56%
57%



Industry contacts;  Arthur  D.  Little,  Inc.

-------
                                                                          TABLE A.10
                                                    BULK PLANTS AND STORAGE CAPACITY - PADD III -  1978
Cubic Meters

Thousand Gallons




Majors & Semi-Majors    110
Independent
Marketer/Wholesalers
Jobbers


TOTAL


% Total


% U.S.
	 ivuiuc. ur aiuKMUL iMrMiiii 	
<151 152-568 569-1136 >1136 PERCENT
.PERCENT OF TOTAL TOTAL
< 40 41-150 151-300 >300 TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY
Thousand Thousand Thousand Thousand
Cu. Meters Gallons Cu. Meters Gallons
110 690 40 20 860 26% 321 84,890 33% 243 64,090
10 50 - - 60 2% 16 4,350 2% 12 3,280
540 1,630 230 -- 2,400 72% 621 164,140 65% 454 119,820
660 2,370 270 20 3,320 100% 958 253,380 100% 709 187,190
20* 71% 8% 10% 100%
28% 16% 22% 7% 18% 14% 18%
js, 1972 Census of Wholesale Trade; National Oil Jobbers Council; National Petroleum News, Factbook (1972-1978);
GASOLINE
AS A PERCENT
TOTAL CAPACITY
75%
75%
73%
74%



        Industry contacts; Arthur 0.  Little, Inc.

-------
                                                                          TABLE  A.11
                                                    BULK PLANTS AND STORAGE CAPACITY  -  PADD IV  -  1978
Cubic Meters

Thousand Gallons




Majors & Semi-Majors     30
Independent
Marketer/Wholesalers
Jobbers
TOTAL
% Total
% U.S.
<151 152-568
< 40 41-150
30 260
20
80 560
110 840
IIS 85*
4i 5i
is, 1972 Census of
n/tnuc. ur oiunnui
569-1136
151-300
20
--
li
30
3%
3%
Wholesale Trade
                                                         >1136

                                                         >300     TOTAL
                                                           10
10
        320
         20
        650
990
1%     100*
         5%
                PERCENT
                OF TOTAL
 32%
  2%
 66%
100%
             TOTAL CAPACITY
           ThousandThousand
          Cu. Meters  6*1Ions
                       141      37,190
                                1,700
                       176     46,600
323     85,490
                                          PERCENT
                                          OF TOTAL
                                          CAPACITY
                     44%
                      2%
                     54%
100%
                                    TOTAL
                               GASOLINE CAPACITY
                               ThousandThousand
                              Cu.  Meters  Gallons
             100
             116
221
          26,430
                        1,300
          30,760
58,490
                                    GASOLINE
                                  AS A PERCENT
                                 TOTAL CAPACITY
               71%
                         75%
               66%
                                                                                                                                                   68"
Source: Bureau of Census, 1972 Census of Wholesale Trade; National  Oil  Jobbers  Council;  National  Petroleum News,  Factbook  (1972-1978);
        Industry contracts;  Arthur D. Little, Inc.

-------
                                                                TABLE ft.12
                                            BULK PLANTS AND STORAGE  CAPACITY  - PADD V - 1978
Cubic Meters
Thousand Gallons
Majors & Semi -Majors
Independent
Marketer/Wholesal ers
Jobbers
> TOTAL f
U)
X Total
% U.S.
<15T
< 40
60
10
100
170

9%
7%
Source: Bureau of Census, 1972
152-568
41-150
620
40
770
1,430

73%
10%
Census of
nnnut ur j i urvnui
569-1136
151-300
60
--
180
240

12%
21%
Wholesale Trade
- \«nrnu 1 1 1
>1136
>300
80
—
50 1
130 1

6%
47%
; National
PERCENT
PERCENT OF TOTAL TOTAL
TOTAL OF TOTAL TOTAL CAPACITY CAPACITY GASOLINE CAPACITY
Thousand thousand Thousand Thousand
Cu. Meters Gallons Cu. Meters Gallons
820 42% 608 160,560 53% 275 72,710
50 3% 16 4,350 2% 10 2,610
,100 55% 520 137,360 45% 338 89,280
,970 100% 1,144 302,270 100% 623 164,600

100%
11% 17% 15%
Oil Jobbers Council; National Petroleum News, Factbook (1972-1978);
GASOLINE
AS A PERCENT
TOTAL CAPACITY
45%
60%
65%
54%




Industry contacts; Arthur D. Little, Inc.

-------
          APPENDIX   B
LIST OF MAJOR AND SEMI-MAJOR OIL COMPANIES
                    B.I

-------
                                TABLE B.I

                         MAJORS AND SEMI MAJORS1
                                 MAJORS
                      Amoco Oil Co.
                      Atlantic Richfield Co.
                      Chevron U.S.A., Inc.
                      Exxon Co., U.S.A.
                      Gulf Oil Co.
                      Mobil Oil Corp.
                      Shell Oil Co.
                      Texaco, Inc.

                               SEMI-MAJORS
                      Amerada Hess Corp.
                      Ashland Oil Co.
                      Cities Service Oil Co.
                      Continental Oil Co.
                      Diamond Shamrock Oil & Gas Co.
                      Getty, Refining & Marketing Co.
                      Kerr-McGee Corp.
                      Marathon Oil Co.
                      Murphy Oil Corp.
                      Phillips Petroleum Co.
                      Standard Oil Co. (Ohio)
                      Sunmark Industries
                      Tenneco Oil Co.
                      Union Oil Co. of California
 Largest 22 gasoline marketers based on total company assets in 1977.

Source: National Petroleum News Factbook
                                  B.2

-------
        APPENDIX  C
OPERATIONAL AND FINANCIAL PRO FORMAS OF
 PROTOTYPICAL BULK STORAGE FACILITIES
                  C.I

-------
                             TABLE  C.I
                  LARGE  MARINE  TERMINAL PROTOTYPE
OPERATIONS
Storage
(Thousand Barrels)
Annual  Tank Turnovers
Annual  Throughput
(Million Gallons)
Daily Throughput
(Thousand Gallons)
                              	PRODUCT GROUP-
                              Gasoline      Distillate
             217
              20

             182.5

             500
424
  9

160.2

439
Total

 641
  13

 342.7

 939
FACILITIES

No. of Tanks
Land (Acres)
No. of Employees
Method of Receipt
-  10
-  25
-  21
-  Marine Tanker (35,000 DWT)
Source: Arthur D. Little, Inc.
                               C.Z

-------
                                  TABLE C.2

                      ESTIMATED INVESTMENT PROFILE OF
                      LARGE MARINE TERMINAL PROTOTYPE
                           (Thousands of Dollars)
 INVESTMENT

 A.   Depreciable Fixed Assets
     Tanks
     Building
     Dock
     Meters,  Piping,  Pumps
     Loading  Racks, etc.
     Miscellaneous Equipment
       Total  Depreciable  Assets

 B.   Other  Fixed Assets
     Land
     Engineering
     Capitalized Interest


 C.   Working  Capital**
     TOTAL  INVESTMENT
  4,171.5
   GROSS         NET
INVESTMENT    INVESTMENT*     NET  COST
                          (S/Shell Barrel)
                                1.50
1,921.5
35.0
650.0
200.0
1,000.0
365.0
960.8
17.0
100.0
175.0
940.0
183.6
2,376.4


  760.0
  350.0
  400.0
1,510.0

   40.0
3,926.4
3.71
                               2.36

                                 .06
                               6.13
 *Book  value of  10 year old  facility.
**Excluding inventory  allocated  to  class  of trade  sales  profit  centers.

 Source: Arthur  D. Little, Inc.
                                   C.3

-------
                                 TABLE  C.3
                    ESTIMATED OPERATING EXPENSES OF
                    LARGE  MARINE  TERMINAL  PROTOTYPE
                        (Thousands  of Dollars)
LABOR
    Straight Time
    15 men X 52 X $320/wk
    ($8.00/hr)
    3 Supervisors
    Plant Manager
    Plant Secretary/Clerk
a)  Straight Time (S&W)
b)  Overtime
    15 men X 47 X $48/wk
     (4 hr 
-------
                         TABLE C.4



            REQUIRED TARIFF (PRE-VAPOR CONTROL)

            OF LARGE MARINE TERMINAL PROTOTYPE
Total Investment

   x Annual Capital Recovery Factor
     (20% BFIT, 20 Years)
                       Net Investment
                     (Thousand  Dollars)

                         3926.4
                             .2054
                                                   806.5
Operating Expenses

Capital Recovery

 Total
   Annual  Cost
(Thousand Dollars)


       987.2

       806.5
     1,793.7
  Required Tariff
($/Annual  Throughput
     Gallon)

    .00288

    .00235

    .00523
Source: Arthur D. Little, Inc.
                           C.5

-------
                             TABLE C.5
                    SMALL MARINE TERMINAL PROTOTYPE
OPERATIONS
Storage
(Thousand Barrels)
Annual Tank Turnovers
Annual Throughput
(Million Gallons)
Daily Throughput
(Thousand Gallons)
           Gasoline
             150
              15

              91.3

             250
-PRODUCT  GROUP-
  Distillate

     124
       7

      36.5

     100
Total

 274
  10

 127.8

 350
FACILITIES
No. of Tanks
Land (Acres)
No. of Employees
Method of Receipt
-  8
-  20
-  13
-  Marine Tanker (20-35,000 DWT)
Source: Arthur D. Little, Inc.
                              C.6

-------
                                 TABLE C.6

                      ESTIMATED INVESTMENT PROFILE OF
                      SMALL MARINE TERMINAL PROTOTYPE

(Thousands
INVESTMENT
A.






Depreciable Fixed Assets
Tanks
Building
Dock
Meters, Piping, Pumps
Loading Racks, etc.
Miscellaneous Equipment
Total Depreciable Assets
of Dollars)
GROSS
INVESTMENT
904.0
10.0
450.0
100.0
400.0
200.0
2,064.0

NET
INVESTMENT*
452.1
5.5
70.0
90.0
375.0
100.0
1,092.6
B.  Other Fixed Assets
    Land
    Engineering
    Capitalized Interest
C.  Working Capital**
    TOTAL INVESTMENT
  500.0
  164.0
  170.0
  834.0

   25.0

1,951.6
                                                                    NET COST
                                                                 ($/Shell  Barrel)
                                                                      1.65
                                                                      3.99
3.04

0.09

7.12
 *Book value of 10 year old facility
**Excluding inventory allocated to class of trade sales  profit  centers

Source:  Arthur D.  Little,  Inc.
                                  C.7

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                                TABLE C.7

                     ESTIMATED OPERATING EXPENSES OF
                     SMALL MARINE TERMINAL PROTOTYPE

(Thousands
LABOR


a)
b)
c)
d)
d)







Straight Time
10 men X 52 X $320/wk
($8.00/hr)
1 Supervisor
Plant Manager
Plant Secretary/Clerk
Straight Time (S&W)
Overtime
10 men X 47 X $48/wk
(4 hr @ $12.00/hr)
Benefits (25% of a)
PICA (6.13% of a+b)
Employee Expenses
Total Labor Expense
1 . Total Labor Expense
2. Miscellaneous Services
3. Maintenance & Repairs
4. Utilities & Misc.
Operating Expenses
5. Local Taxes
6. Insurance/Mi sc. Fixed Costs
Total Expenses
of Dollars)
ANNUAL
EXPENSE
166.4
20.0
30.0
12.0
207.6
22.6
51.9
15.0
11.7
308.8
308.8
4.2
20.5
24.2
80.0
65.2
502.9

S/ANNUAL
THROUGHPUT
GALLON








.00242
.00003
.00016
.00019
.00063
.00051
.00394

PERCENT OF
TOTAL
EXPENSES








61%
1%
4%
5%
16%
13%
100%
Source: Arthur D.  Little,  Inc.
                                 C.8

-------
                         TABLE C.8



            REQUIRED TARIFF (PRE-VAPOR CONTROL)

            OF SMALL MARINE TERMINAL PROTOTYPE
                                                Net Investment
                                              (Thousand Dollars)

Total Investment                                  1,951.6

   x Annual Capital Recovery Factor
     (20% BFIT, 20 Years)                              .2054

                                                    400.9
                             Annual  Cost        Required Tariff
                          (Thousand  Dollars)   ($/Annual Throughput
                                                   Gallon)

Operating Expenses               502.9              .00394

Capital Recovery                 400.9              .00314

   Total                         903.8              .00708
 Source:  Arthur D.  Little, Inc.
                            C.9

-------
                             TABLE C.9
                 LARGE PIPELINE TERMINAL PROTOTYPE
OPERATIONS
Storage
(Thousand Barrels)
Annual Tank Turnovers
Annual Throughput
(Mil-lion Gallons)
Daily Throughput
(Thousand Gallons)
                              	PRODUCT GROUP-
                              Gasoline      Distillate
                                       Total
145
30
182.5
500
141
20
118.6
325
286
23
301.1
750
FACILITIES
No. of Tanks
Land  (Acres)
No. of Employees  -
Method of Receipt -
8
15
16
Colonial Pipeline
Source: Arthur D. Little,  Inc.
                               C.lff

-------
                                 TABLE C.10

                      ESTIMATED INVESTMENT PROFILE OF
                     LARGE PIPELINE TERMINAL PROTOTYPE
(Thousands of Dollars)
INVESTMENT
A.





B.



C.
Depreciable Fixed Assets
Tanks
Building
Meters, Piping, Pumps
Loading Racks, etc.
Miscellaneous Equipment
Total Depreciable Assets
Other Fixed Assets
Land
Engineering
.Capitalized Interest
Working Capital**
GROSS NET
INVESTMENT INVESTMENT* NET COST
; ($/Shell Barrel)
858.0 429.0 1.50
30.0 16.0
175.0 153.1
1,000.0 940.0
300.0 150.0
2,363.0 1,688.1 5.90
275.0
250.0
225.0
750.0 2.62
35.0 0.12

    TOTAL INVESTMENT
2,473.1
8.64
 *Book value of 10 year old facility
**Excluding inventory allocated to class of trade sales profit centers

Source: Arthur D.  Little, Inc.
                                  C.ll

-------
                               TABLE C.11

                    ESTIMATED OPERATING EXPENSES OF
                   LARGE PIPELINE TERMINAL PROTOTYPE

(Thousands of
LABOR


a)
b)
c)
d)
e)






Straight Time
12 men X 52 X $280/wk
($7.00/hr)
2 Supervisors
Plant Manager
Plant Secretary/Clerk
Straight Time (S&W)
Overtime
12 men X 47 X $42/wk
(4 hr 9 $10.50/hr)
Benefits (25% of a)
PICA (6.13% of a+b)
Employee Expenses
Total Labor Expense
1 . Total Labor Expense
2. Miscellaneous Services
3. Maintenance & Repairs
4. Utilities & Misc.
Operating Expenses
5. Local Taxes
6. Insurance/Mi sc. Fixed Costs
Dol 1 ars )
$/ANNUAL PERCENT OF
ANNUAL THROUGHPUT TOTAL
EXPENSE GALLON EXPENSES
174.7
40.0
30.0
12.0
236.7
23.7
59.2
16.8
14.1
350.5
350.5 .00117 49%
9.8 .00003 1%
32.9 .00011 4%
57.1 .00019 8%
133.0 .00044 18%
149.0 .00049 20%
        Total  Expenses
Source:  Arthur D.  Little,  Inc.
732.3
.00243
100%
                                 C.12

-------
                         TABLE C.I2
            REQUIRED TARIFF (PRE-VAPOR CONTROL)

           OF LARGE PIPELINE TERMINAL PROTOTYPE
                                                Net Investment
                                              (Thousand Dollars)

Total Investment                                  2,473.1

   x Annual Capital Recovery Factor
     (20% BFIT, 20 Years)                              .2054

                                                    508.0
                             Annual  Cost         Required Tariff
                          (Thousand  Dollars)   ($/Annual Throughput
                                                  Gallon)

Operating Expenses               732.3              .00243

Capital Recovery                 508.0              .00169

   Total                       1,240.3              .00412
 Source:  Arthur D.  Little, Inc.
                            C.13

-------
                            TABLE C.I3
                 SMALL PIPELINE TERMINAL PROTOTYPE
OPERATIONS
Storage
(Thousand Barrels)
Annual Tank Turnovers
Annual Throughput
(Million Gallons)
Daily Throughput
(Thousand Gallons)
Gasoline
72.5
30
91.3
250
— TKUUUUI unuui 	
Distillate
56.5
20
47.5
130
Total
129
25
138.8
380
FACILITIES
No. of Tanks
Land (Acres)
No. of Employees  -
Method of Receipt -
6
10
11
Colonial Pipeline
 Source:   Arthur D. Little,  Inc.
                               C.l*

-------
                                 TABLE C.I4

                      ESTIMATED INVESTMENT PROFILE OF
                     SMALL PIPELINE TERMINAL PROTOTYPE
(Thousands of Dollars)
INVESTMENT
A.




B.




C.

Depreciable Fixed Assets
Tank
Building
Meters, Piping, Pumps
Loading Racks, etc.
Miscellaneous Equipment
Total Depreciable Assets
Other Fixed Assets
Land
Engineering
Capitalized Interest

Working Capital**
TOTAL INVESTMENT
GROSS NET
INVESTMENT INVESTMENT* NET COST
($/ Shell Barrel)
444.7 222.4 1.72
7.0 3.4
40.2 35.2
364.5 342.6
73.5 37.0
929.9 640.6 4.97
182.4
94.3
107.8
384.5 2.98
16.0 .12
989.9 8.07
 *Book value of 10 year old facility
**Excluding inventory allocated to class of trade sales profit centers,

Source: Arthur D.  Little, Inc.
                                  C.15

-------
                                TABLE C.I5
LABOR
    Straight Time
    8 men X 52 X $280/wk
    ($7.00/hr)
    1  Supervisor
    Plant Manager
    Plant Secretary/Clerk
a)  Straight Time (S&W)
b)  Overtime
    8 men X 47 X $42/wk
    (4 hr @ $10.50/hr)
c)  Benefits (25% of a)
d)  PICA (6.13% of a+b)
e)  Employee Expenses
    Total Labor Expense

    1.  Total  Labi
    2.  Miscellant
    3.  Maintenam
    4.  Utilities
    5.
    6.
Local Taxes
Insurance/M
Total Expenses
ESTIMATED OPERATING EXPENSES OF
SMALL PIPELINE TERMINAL PROTOTYPE
(Thousands
50/wk
'Clerk
;&w)
!/wk
T)
:a)
i+b)
IS
inse
Expense
is Services
& Repairs
Misc.
:penses

sc. Fixed Costs
of Dollars)
ANNUAL
EXPENSE
116.5
20.0
30.0
12.0
178.5
15.8
44.6
11.5
9.4
250.4
250.4
4.5
11.4
26.3
60.0
70.9

S/ANNUAL PERCENT OF
THROUGHPUT TOTAL
GALLON EXPENSE







.00182 59%
.00003 1%
.00008 3%
.00019 6%
.00043 14%
.00052 17%
                                       423.5
.00305
100%
 Source:  Arthur D.  Little,  Inc.
                                 C.16

-------
                         TABLE C.I6

            REQUIRED TARIFF (PRE-VAPOR CONTROL)
           OF SMALL PIPELINE TERMINAL PROTOTYPE
                                                Net Investment
                                              (Thousand Dollars)
Total Investment                                  989.9
   x Annual Capital Recovery Factor
     (20% BFIT, 20 Years)                         .   .2054
                                                  203.3
                            Annual Cost        Required Tariff
                          (Thousand Dollars)   ($/Annual Throughput
                                                  Gallon)
Operating Expenses              423.5             .00305
Capital Recovery                203.3             .00146
   Total                        627.8             .00451
Source: Arthur  D.  Little,  Inc.
                           C.17

-------
                            TABLE C.I7
                    LARGE BULK PLANT PROTOTYPE
OPERATIONS
                              	PRODUCT GROUP-
                              Gasoline      Distillate      Total
Storage
(Thousand Gallons)              183            182           365
Annual Tank Turnovers            40             20            30
Annual Throughput
(Thousand Gallons)            7,300          3,650        10,950
Daily Throughput
(Thousand Gallons)               20             10            30
FACILITIES
No. of Tanks      -  4
Land (Acres)      -  5
No. of Bulk Plant Employees - 4
Method of Receipt -  Tank transport from a primary terminal
Source:  Arthur D. Little, Inc.
                               C.181

-------
                                TABLE C.I8


                     ESTIMATED INVESTMENT PROFILE OF
                       LARGE BULK PLANT PROTOTYPE
(Thousands of Dollars)
GROSS
INVESTMENT (Bulk Plant Only) INVESTMENT
NET
INVESTMENT*
NET COST
($/Shell Gallon)
A.





B.

C.

Depreciable Fixed Assets
Tanks
Building
Meters, Piping, Pumps
Loading Racks, Tankwagons (4)
Miscellaneous Equipment
Total Depreciable Assets
Other Fixed Assets
Land
Working Capital**
TOTAL INVESTMENT
48.0
20.0
26.0
79.0
18.0
214.0

234.0
31.0
12.0
16.0
51.0
13.0
123.0
10.0
10.0
143.0
0.08




0.34
0.13
0.03
0.50
 *Book value of 25 year old facility
**Bulk plant operations only.   Excludes  inventory allocated  to class of trade
  profit centers.


Source: Arthur D.  Little, Inc.
                                   C.19

-------
                                TABLE C.I9
                     ESTIMATED OPERATING EXPENSES OF
                       LARGE BULK PLANT PROTOTYPE
                         (Thousands of Dollars)
LABOR
a)  Straight Time
    4 men X 52 X $260/wk
    ($6.50/hr)
b)  Overtime
    4 men X 47 wks X $39/wk
    (4 hr 0 $9.75/hr)
c)  Benefits (20% of a)
d)  PICA (6.13% of a+b)
e)  Employee Expenses
    Total Labor Expense
ANNUAL
EXPENSE
  54.1

   7.3
  10.8
   3.8
   2.0
  78.0
 $/ANNUAL
THROUGHPUT
  GALLON
PERCENT OF
  TOTAL
 EXPENSE
    1.  Total Labor Expense
    2.  Maintenance & Repairs
    3.  Utilities & Misc. Operating
        Expenses & Services
    4.  Local Taxes
    5.  Insurance/Misc. Fixed Costs
        Total Expenses
78.0
10.1
17.5
31.9
25.0
162.5
0.00714
0.00092
0.00160
0.00291
0.00228
0.01486
48%
6%
11%
20%
15%
100%
Source: Arthur D. Little, Inc.
                                  C.20

-------
                         TABLE C.20
            REQUIRED TARIFF (PRE-VAPOR CONTROL)

               OF LARGE BULK PLANT PROTOTYPE
                                                Net Investment
                                              (Thousand Dollars)

Total Investment                                  143.0

   x Annual Capital Recovery Factor
     (20% BFIT, 20 Years)                            .2054

                                                   29.4
                            Annual Cost        Required Tariff
                          (Thousand Dollars)   ($/Annual Throughput
                                                   Gallon)

Operating Expenses               162.5              0.01486

Capital  Recovery                  29.4              0.00268

    Total                         191.9              0.01754
 Source:  Arthur D. Little, Inc.
                            C.21

-------
                            TABLE C.21
                    SMALL BULK PLANT PROTOTYPE
OPERATIONS
                              	PRODUCT GROUP-
                              Gasoline      Distillate      Total
Storage
(Thousand Gallons)               45             30            75
Annual Tank Turnovers            32             20            27
Annual Throughput
(Thousand Gallons)            1,460            600         2,060
Daily Throughput
(Thousand Gallons)              4.0            1.6           5.6
FACILITIES
No. of Tanks      -  4
Land (Acres)      -  5
No. of Bulk Plant Employees - 2
Method of Receipt -  Tank transport from a primary terminal


Source: Arthur D. Little, Inc.
                              C.22

-------
                                 TABLE C.22

                      ESTIMATED INVESTMENT PROFILE OF
                        SMALL BULK PLANT PROTOTYPE
                          (Thousands of Dollars)
INVESTMENT (Bulk Plant Only)
A.
    Depreciable  Fixed  Assets
    Tanks
    Building
    Meters, Piping,  Pumps
    Loading Racks, Tankwagons (2)
    Miscellaneous  Equipment
      Total Depreciable Assets

B.  Other Fixed  Assets
    Land
C.  Working Capital
                   **
                                          GROSS         NET
                                       INVESTMENT    INVESTMENT*
                                          71
            NET COST
14
14
7
30
5
9
8
4
22
3
    TOTAL INVESTMENT
                                          83
45


10

 2

57
                                                                ($/Shell  Gallon)
                                                                      0.12
0.60


0.13

0.03

0.76
 *Book value of 25 year old  facility
**Bulk plant operations only.  Excludes  inventory allocated to class of trade
  profit centers.

Source:  Arthur D. Little,  Inc.
                                   C.23

-------
                                TABLE  C.23
                     ESTIMATED OPERATING EXPENSES OF
                       SMALL  BULK PLANT PROTOTYPE
                         (Thousands  of Dollars)
LABOR
a)  Straight Time
    2 men X 52 X $260/wk
    ($6.50/hr)
b)  Overtime
    2 men X 47 wks X $39/wk
    (4 hrs 0 $9.75/hr)
c)  Benefits (20% of a)
d)  PICA (6.13% of a+b)
e)  Employee Expenses
    Total Labor Expense
    1.  Total Labor Expense
    2.  Maintenance & Repairs
    3.  Utilities & Misc. Operating
        Expenses & Services
    4.  Local Taxes
    5.  Insurance/Misc. Fixed Costs
        Total Expenses
ANNUAL
EXPENSE
  27.0

   3.7
   5.4
   1.9
   1.0
  39.0
 $/ANNUAL
THROUGHPUT
  GALLON
PERCENT OF
  TOTAL
 EXPENSE
39.0
1.9
3.3
6.0
4.7
54.9
0.01898
0.00092
0.00160
0.00291
0.00228
0.02670
71%
3%
6%
11%
9%
100%
 Source: Arthur D. Little, Inc.
                                  C.24

-------
                         TABLE C.24
            REQUIRED TARIFF (PRE-VAPOR CONTROL)
              OF SMALL BULK PLANT PROTOTYPE
                                                Net Investment
                                              (Thousand Dollars)
Total Investment                                   57.0
   x Annual Capital Recovery Factor
     (20% BFIT, 20 Years)                            .2054
                                                   11.7
                            Annual  Cost        Required Tariff
                         (Thousand Dollars)  ($/Annual Throughput
                                                  Gallons)
Operating Expenses              54.9              0.02670
Capital Recovery                11.7              0.00568
   Total                        66.6              0.03238
Source: Arthur D. Little, Inc.
                           C.25

-------
      APPENDIX   D
VAPOR CONTROL COSTS PROVIDED BY EPA
              D.I

-------
                                            TABLE  D.I

                                    MODEL TERMINAL PARAMETERS
Average Daily Loading Rate:

   m3/day

   gallons/day

DESIGN FACTORS
(a)
(b
 a)  Number of rack  positions
,b)  Number of loading arms per position
(c)  Method of loading
(d) Pumps (each)

(e) Tank truck capacities

(f) Tank truck loading time  (total)
(g) Peak hour loading
       (e)  *  (f)  x  60 x  (a)

(h) Maximum  instantaneous loading
       (a)  x  (b)  x  (d)

EMISSION FACTORS
Uncontrolled:
    Total hydrocarbon
    Benzene
Controlled3:

    Total  hydrocarbon
    Benzene (95% reduction)
TERMINAL  OPERATING SCHEDULE
                                                  950

                                              250,000
      2
      3
Submerged (top or
bottom)
1.9 m3/min
 (500 gpm)
30 m3
 (8,000 gallons)
20 minutes/truck

 180 m3/hr
 (48.000 gph)
 11 nr/min
 (3,000 gpm)
                                           960 mg/liter
                                           8 mg/liter
                                           80 mg/liter
                                           0.4 mg/liter
                              1,900
                            500,000
      4
      3
Submerged (top or bottom)
1.9 m3/min  (500 gpm)


30 m3  (8,000 gallons)
20 minutes/truck

360 m3/hr  (96,000 gph)

22 m3/min  (6,000 gpm)
                         960 mg/liter
                         8 mg/liter
                         80 mg/Inter
                         0.4 mg/liter

                         300 days/year)
                                            300 days/year

aAssumes 100 percent vapor collection ar rack  during  loading and no losses in vapor collection  system

Source: U.S. Environmental Protection Agency

-------
                                TABLE D.2
                     COST FACTORS USED IN DEVELOPING
              ANNUALIZED COST ESTIMATES FOR MODEL TERMINALS
Utilities:
     -  Electricity
     -  Propane
Operating Labor
Maintenance (percent of equipment cost)
     -  Refrigeration (RF) Vapor Recovery
     -  Compression-Refrigeration-Absorption
        (CRA) Vapor Recovery
     -  Adsorption-Absorption (AA) Vapor
        Recovery

     -  Oxidizer (OX)
Capital Charges (percent of capital cost):
     -  Interest and depreciation, plus
     -  Property taxes, insurance and
        administrative overhead
Gasoline Value (recovered) FOB
 Terminal  Before Tax:
Carbon for AA unit (replacement cost)
$.017/106 joules (S.Oe/Kw-hr)1
$.10/1 Her ($.40/gal Ion)
$10/man-hour
6 percent
         2
4 percent
         3
4 percent  (carbon replacement
  is additional)
4 percent
16 percent

4 percent

$.10/liter ($.40/gallon)!
$21/Kg ($.90/lb)
 Industry data reported to EPA
2
 Based upon actual  maintenance costs reported to EPA
 Assumed to be comparable to CRA
4
 Calculated using capital recovery factor formula assuming 10 year equipment
 life and 10 percent interest rate.
50il  Daily - March  1978.

Source: U.S. Environmental Protection Agency
                                  D.3

-------
                                                                    TABLE  D.3
o j
ESTIMATED CONTROL COSTS FOR MODEL EXISTING TERMINALS
SINGLE VAPOR CONTROL SYSTEM ALTERNATIVES
(Thousands of January 1978 Dollars)
Gasoline Loaded:
Vapor Control System:
investment
Purchase Cost (FOB factory)*
Total Installed Cost
Annual izt'd Cost(credit)
Electricity0
Propane(pilot)
Maintenance
Operating labor6
Carbon Replacement
Subtotal (Direct operating costs)
Capital Charges
Gasoline Recovery(credit)^
Net Annual izod Cost(credit)
950 m3/day
1250,000 gallons/day)
AA
120
240
3.9
4.8
1.5
2.4
12.6
48.0
(39.2)
21.4
CRA
128b
256
5.1
' 6.)
1.5
11.7
51.2
(39.2)
23.7
OX
72
144
2.9
1.0
2.9
1.5
8.3
28.8
«*.
37.1
RF
102
204
9.9
6.1
1.5
17.5
40.0
(39.2)
19.1
AA
155
310
7.8
6.2
1.5
4.7
20.2
62.0
(78.4)
3.U
1900 m3/day
(500,000 gallons/day)
CRA
I64b
328
8.3
6.6
1.5
16.4
65.6
(78.4)
3.6
OX
95
190
5.8
1.0
3.8
1.5
12.1
30.0
__
50.1
RF
153
306
19.8
9.2
1.5
30.5
61.2
(78.4)
13.3
           Vendor quotes
           Includes vapor holder
           All  systems except CRA calculated at  12 hours/day of  vendor estimated nominal Kw draw  - CRA hours based upon design  flow rate.
           Estimated jt ./J gal/hour operation
          £
           Inspections at .5 man-hr/day.
           Estimated based upon three year carbon life
          Calculated jt 16°C (60°F) and 100K vapor collection at rack.
          Source:  I1.  S.  Environmental  Protection Agency

-------
                                                           TABLE  D.4
ESTIMATED CONTROL COSTS FOR MODEL EXISTIf
STAND-BY CONTROL SYSTEM ALTERNATIVE

Gasoline Loaded:
Total Installed Capital Cost
Direct Operating Costs
Utilities
Maintenance and Labor and materials
Capital Charges
Gasoline (credit)
Net Annual Ized Cost(credit)
(Thousands
of January
1978 Dollc
950 ni3/day
(250,000 yal Ions/day)
Stand-by System
Only (OX)a
95

Footnote b
2.9
19.0
-
21.9
Primary/Stand-by System
(Rf/OX)
299

9.9
10.5
59.3
(37.2)c
43
(OX/OX)
239

3.9
7.3
47. 0
-• —
b'J.O
«3 TERMINALS
:s
irsl
1900
(bOO.OOO
Stand-by System
Only (OX)a
126

Footnote b
3.8
25.2
•.-
29.0

m /day
gallons/day)
Primavj/Stand-Lu' System
(A/VOX) (OX/OX)
436 316

17.8 b.ti
16.2 D.I
U7.2 63.2
(74.5)c
36.7 79.1
aStand-by system costs  are shown separately for those terminals that have already installed vapor controls to comply with existing SIP
 requirements for hydrocarbons.
 These  will vary but should not significantly effect net operating costs of the primary/stand-by combination.
GKecovery reductions will vary but are estimated at 5 percent or 15 days down  time on primary  system.
 Source:  U.S. Environmental  Protection  Agency

-------
                                                       TABLE D.5
                                              MODEL BULK PLANT PARAMETERS
                                                               Small  Model
cr>
  1.   Throughput,  (liters/day)
  2.   Loading  Racks
  3.   Loading  Arms per  Rack
  4.   Storage  Tanks  (above-ground)
  5.   Account  Trucks  (Tank Wagons)
  6.   Account  Trucks  Converted  to Vapor Control
  7.   Compartments per  Account  Truck
  8.   Density  of Gasoline  (Ib/gallon)
  9.   Emissions  of HC.Prevented (mg/liter)
           Option 1
           Option 3
           Option 4
 10.   Working  Days per  Year
 11.   Working  Hours per Day
 12.   Peak  Loading Rate (liters per minute)
 13.   Liquid to  Vapor Ratio
?14.   Operating  Labor Cost ($/hour)
 15.   Propane  for Oxidizer (gallons/hour)
 16.   Price of Propane  ($/gallon)
 17.   Price of Electricity ($/KWH)
 18.   Capital  Recovery  Factors  (interest)
      a.  Vapor Balance  Equipment at 20-year life,
         10% interest
      b.  Refrigeration  or oxidation equipment at
         10-year life,  10% interest
      c.  Taxes,  insurance, administration on
         capital (all equipment)
                                                       15,000 (4,000 gallons/day)
                                                                   1
                                                                   3
                                                                   3
                                                                   2
                                                                   1
                                                                   4
                   	Large Model	

                   76,000 (20,000 gallons/day)
                                1
                                3
                                3
                                4
                                2
                                4
 800
1260
3429
 286
  8
 490 (130 gallons/minute)
 7.5
10.0
0.72
0.40
0.05
                                                                 0.118

                                                                 0.163

                                                                 0.04
 800
1260
3429
 286
  8
 490 (130 gallons/minute)
 7.5
10.0
0.72
0.40
0.05
                              0.118

                              0.163

                              0.04
   Source: U.S.  Environmental  Protection Agency

-------
                                                                    TABLE  D.6
o
1. Truck  (Tank Wagon)  Conversion, Including
   Labor
2. Rack Conversion,  including labor

3. Installation, excluding labor
4. TOTAL  INSTALLED CAPITAL
            5. Operating Labor
            6. Utilities
            /. Maintenance  Labor and Materials
            8. Capital Charges
            9. TOTAL ANNUAL I ZED COST

           10. Less Recovery Credit
           11. NET ANNUAL I ZED COST
OPTIONS 1 AND 2 COST ESTIMATES (NOJC COSTS)
(Thousands of January
Option 1
1978 Dollars)

Bottom or' Top-Submerged
Loadimj wild Incoming Vapor Balance
Bottom l.oadina
Top -Submerged
15,000 76,000 15,000 76,000
. ,. _ Ipd Ipd Ipd 	 jpd
luding 	 c — 	 ' — — c 	 — •* —
6.27 12.54
35.45 35.45
5.31 b.82
47.03 53.ol
NONE
NONE
1.41 l.bl
7.41 U.4U
8. 02 10.09
0.51 2.59
8.31 7.50
N/A N/A
3.54 3.54
0.71 0.71
4.25 4.2b
NONE
NONE
0.13 0.13
0.67 0.6/
0.80 0.80
0.51 2.59
0.29 (1.79)



Option 2
Bottom or lop-Submerged Loading UiLh
Incoming and Outgoing Vapor Balance
Uottoni Loading
15,000 76,000
7.02 14.05
35.45 35.45
b.52 6.22
t/.9U 55.72
NONE
NOME
1.43 1.67
/.56 8./6
0.99 10.43
0.81 4.08
8.18 6.35
Top-Submerged
15,000 76,000
lyd Ipd
2.3U 4.76
18.30 18.30
2.36 2.6/
23. U3 *5.7J
NONE
NONE
0.69 0.77
3.63 4. Ob
4.32 4.S?
0.81 4.08
3.51 0.74
         Source:  U.S. Environmental  Protection  Agency

-------
                                                                       TABLE  D.7
P.
CO
Recovery Equipment
     Processing Equipment
Recovery Installation
     Processina installation
 TOTAL INSTALLED CAPITAL

Recovery Operating Labor
     Processing Operating Labor
Recovery Utilities
     Processing Utilities
Recovery Maintenance
     Processing Maintenance
Recovery Capital Charges
     Processing Capital Charges
 TOTAL ANNUAL I ZED COST
Les»s: Processing Recovery Credit
 MET ANNUALIZED COST
OPTION 3 COST ESTIMATE (NOJC COSTS)
(thousands
of January 1978 Dollars)
SINGLE
SYSTEMS
Refrlqeratlon
Bottom
15,000
Ipd
42.47
43.22
5.52,
25.93
117.14
NONE
1.43
NONE
2.17
1.43
2.59
7.56
14.02
29.20
2.19
27.01
Loading
76.000
Ipd
49.50
43.22
6.22
25.93
124.'07
NONE
1.43
NONE
2.17
1.67
2.59
U./6
14.02
30.64'
11.11
19. SJ
Top Submerged
15,000
Ipd
20.68
43.22
2.35
25.93
92.18
NONE
1.43
NONE
2.17
0.69
2.59
3.63
14.02
24.63
2.19
22.34
76,000
Ipd
23.06
43.22
2.67
25.93
94.08
NONE
1.43
NONE
2.17
0.77
2.59
4.05"
14.02
25.03
11.11
13.92
Bottom
15,000
Ipd
42.47
15.50
5.52
9.76
73.25
NONE
1.43
NONE
0.16
1.43
0.62
7.56
5.12
16:32
NONE
16.32



Oxidation
Loading
?6,000
Ipd
49.50
15.50
b.22
9.76
80. 9R
NONE
1.43
NONE
0.16
l.b/
0.62
8-76
; 5.12
17.76
NONE
1 7 '. 76
Top
15,000
Submerged
76,000
Ipd
20.68 23.06
lb.50
2.'36
9.76
48:32
NONE
1.43
NONE
0.16
U.b9
0.62
3.63
5.12
^.es
NONE
11.65
15.50
2.67
9./6
60.99
NONE
1.43
NONE
0.16
0.77
0.62
4.05
5.)
-------
                                                           TABLE  D.7
                                                           continued

                                          OPTION 3  COST ESTIMATE  (NOJC  COSTS
                                          (Thousands of January 1978 Dollars
                                                                                 DUAL SYSTEMS
                                                   Refrigeration Plus Oxidation
Oxidation Plus Oxidation
Recovery  Equipment
     Processing Equipment
Recovery  Installation
     Processing Installation
 TOTAL INSTALLED CAPITAL
Recovery  Operating Labor
     Processing operating Labor
Recovery  Utilities
     Processing utilities
Recovery  Maintenance
     Processing Maintenance
Recovery  Capital Charge
     Processing Capital  Charges
 TOTAL ANNUAL IZED COST
Less: Processing Recovery Credit
 NET ANNUAL IZED COS I
Bottom Loading
15,000
Ipd
42.47
5U.70
5.52
35.69
142.38
NONE
1.42
NONE
2.17
1.43
2.90
' 7.56
19.54
35.03
2.19
32.84
76,000
Ipd
49.50
58.70
5.52
35,69
149.41
NONE
1.43
NONE
2.17
1.67
2.90
8.76
19.54
36.47
11.11
25.36
Top Submerged
15,000
Ipd
20.68
50.70
2.35
35.69
117.42
NONE
1.43
NONE
2.17
0.69
2.90
3.63
19.54
30.36
2.19
28.17
76,000
Ipd
22.06
58.70
2.67
35.69
120.12
NONE
1.43
NONE
2.17
0.77
2.90
4.05
19.54
30.86
11.11
19.75
Bottom Loading
15,000
Ipd
42.47
31.00
5.52
19.52
9(1.51
NONE
1.43
NONE
0.16
1.43
U.93
7.56
10.24
21.75
NONE
21.75
76,000
Ipd
49.50
31.00
5.52
19.52
105.54
NONE
1.43
NONE
0.16
1.67
0.93
8;76
10.24
23.19
NONE
23.19
Top Submerged
15,000
Ipd
20.68
31.00
2.35
19'. 52
73.55
NONE
1.43
NONE
0.16
0.69
0.93
3.63
10.24
17.08
NONE
17.08
76,000
Ipd
23.06
31.00
2.67
19.52
76.25
NONE
1.43
NONE
0.16
0.77
0.93
4.05
10.24
17.58
NONE
17.58

-------
TABLE D.8
OPTIONS 1 AND 2 COST
ESTIMATES
(Thousands of
(WIGGINS AND HOUSTON-GALVESTON COSTS)
January 1978 Do
Option 1 '
liars)
Bottom or Top-Submerged
Loading with Incoming Vapor Balance
Bottom Loading
15,000 76,000
Ipd Ipd
Truck (tank wagon) conversion, including
labor
Rack conversion. Including labor
Piping rack to storage, Including
labor
Installation, excluding labor
TOTAL INSTALLED CAPITAL
Operating Labor
Utilities
Maintenance Labor and Material
Capital charges
TOFAL ANNUAL IZED COST
Less Recovery Credit
NET ANNUAL 1 ZED COST (credit)
0.97
7.47
1.58
2.29
12.31
NONE
NONE
0.37
1.94
2.31
0.51
1.7.0
1.95
7.47
1.58
2.34
13.34
NONE
NONE
0.40
2.10
2.50
2.59
(0.09)
Top-Submerged
15,000 76,000
Ipd Ipd
N/A
3.54
N/A
0.71
4.25
NONE
NONE
0,13
0.67
0.80
0.51
0.29
N/A
3.54
N/A
0.71
4.25
NONE
NONE
0.13 •
0.67
0.80
2.59
(1.79)
Option 2
Bottom or Top-Submerged Loading With
Incoming and Outgoing Vapor Balance
Bottom
T5.000
Ipd
1.95
7.47
1.58
2.34
13.34
NONE
NONE
0.40
2.10
2.50
0.81
1.69
Loading
76,000
_.JP.
-------
TABLE D.9
OPTION 3 COST ESTIMATES (WIGGINS AND HOUSTON-GALVESTON COSTS)
(Thousands of January 1978 Dol
Refrigeration
Bottom Loading
15,000 76,000
Ipd Ipd
Recovery Equipment
Processing Equipment
Recovery Installation
Processing Installation
TOTAL INSTALLED CAPITAL
Recovery Operating tabor
Processing Operating Labor
Recovery Utilities
Processing Utilities
Recovery Maintenance
Processing Maintenance
Recovery Capital Charges
Processing Capital Charges
TOTAL ANNUAL I ZED COST
Less: Processing Recovery Credit
NET ANNUAL I ZED COST
11.00
43.22
2.34
25.93
82.49
NONE
1.43
NONE
2.17
0.40
2.59
2.10
14.02
22.71
2.19
20.52
12.95
43.22
2.45
25.93
84.55
NONE
1.43
NONE
2.17
0.46
2.59
2.43
14.02
23.10
11.11
11.99
lars)
Top Submerged
15,000 76,000
Ipd Ipd
8.87
43.22
1.83
25.93
79.85
NONE
1.43
NONE
2.17
0.32
2.59
1.69
14.02
22.22
2,19
20.03
11.04
43.22
1.94
25.93
82.13
NONE
1.43
NONE
2.17
0.39
2.59
2.04
14.02
22.64
11.11
11.53
Oxidation
Bottom Loading
15,000 76,000
]pd Ipd
11.00
15.50
2.34
9.76
38.60
NONE
1.43
NONE
0.16
0.40
0.62
2.10
S.12
9.83
NONE
9.83
12.95
15.50
2.45
9.76
40.66
NONE
1.43
NONE
0.16
0.46
0.62
2.43
S.12
10.22
NONE
10.22
Top Submerged
15,000 76,000
Ipd Ipd
8.87
15.50
1.83
9.76
35.96
NONE
1.43
NONE
0.16
0.32
0.62
1.69
5.12
9.34
NONE
9.34
11.04
15.50
1.94
9.76
38.24
NONE
1.43
NONE
0.16
0.39
0.62
2.04
5.12
9.76
NONE
9.76

-------
ro
Recovery Equipment
Processing Equipment
Recovery Installation
Processing Installation
  TOTAL INSTALLED CAPITAL
Recovery Operating Labor
Processing Operating Labor
Recovery Utilities
Processing Utilities
Recovery Maintenance
Processing Maintenance
Recovery Capital Charge
Processing Capital Charges
  TOTAL ANNUAL I ZED COST
Less:  Processing Recovery Credit
  NET  ANNUAL I ZED COST
TABLE D.9
continued
OPTION 3 COST ESTIMATES (WIGGINS AND HOUSTON- GAL VESTON COSTS)
(Thousands of January 1973 Dollars)
Refrigeration Plus Oxidation
Bottom Loading
15,000 76,000
Ipd Ipd
4.00
58.70
2^34
35.69
107.73
NONE
1.42
NONE
2.17
0.40
2.90
2.10
19.54
28.53
edit 2.19
26.34
12.95
58.70
2.45
35.69
109.79
NONE
1.43
NONE
2.17
0.46
2.90
2.43
19.54
28.93
11.11
17.82
Top Submerged
15,000 76.000
Ipd Ipd
8.87
58.70
1.83
35.69
105.09
NONE.
1.43
NONE
2.17
0.32
2.90
1.69
19.54
22.05
2.19
25.86
11.04
58.70
1.94
35.69
107.37
NONE
1.43
NONE
2.17
0.39
2.90
2.04
19.54
28.47
11.11
17.36
Oxidation Plus Oxidation
Bottom Loading
15,000 76,000
Ipd Ipd
11.00
31.00
2.34
19.52
63.86
NONE
1.43
NONE
0.16
0.40
0.93
2.10
10.24
15.26
NONE
15.26
12.95
31.00
2.45
19.52
65.92
NONE
1.43
NONE
0.16
0.46
0.93
2.43
10.24
15.65
NONE
15.65
Top Submerged
15,000 76,000
Ipd Ipd
8.87
31.00
1.83
19.52
61.22
NONE
1.43
NONE
0.16
0.32
0.93
1.69
10.24
14.77
NONE
14.77
11.04
31.00
1.94
19.52
63.50
NONE
1.43
NONE
0.16
0.39
0.93
2.04
10.24
15.19
NONE
15.19

-------
                                                         TABLE  D.10
  .
    labor"
 2.  Rack Conversion,  including  laborc
 3.  Installation,  excluding  labor
 4.  TOTAL INSTALLED CAPITAL
 5.  Operating Labor
 6.  Utilities
 7.  Maintenance Labor and Materials
 6.  Capital  Charges5
 9.  TOTAL ANNUAL IZED  COST
10.  Less Recovery  Credit
11.  NET ANNUALI ZED COST
OPTIONS 1 AND 2 COST ESTIMATES (COLORADO APCD COSTS)
(Thousands of January 1978 Dollars)
Option
1
Bottom or Top-Submerged
Loading with Incoming Vapor Balance
Bottom Loading
15,000 76,000
Ipd Ipd
•sion, including 0.97 1.94
Ing laborc 1.08 1.08
labord 0.28 0.41
2.33 3.43
NONE
NONE
iterials 0.07 0.10
0.37 0.54
0.44 0.64
0.51 2,59
(0.07) (1.95)
Top-Submerged
15,000 76,000
Ipd Ipd
0.75 0.75
0.75 0.75
0.20 0.20
1.70 1.70
NONE
NONE
0.05 0.05
0.27 0.27
0.32 0.32
0.51 2.59
(0.19) (2.27)

Option 2
Bottom or Top-Submerged Loading With
Incoming and Outgoing Vapor Balance
Bottom Loading
T5.000 76,000
_l£d_ Ipd
1.61 3.23
1.08 1.08
0.36 0.58
3.05 4.89
NONE
NONE
0.09 0.15
0.48 0.77
0.57 0.92
0.81 4.08
(0.24) (3.16)
Top-Submerged
jpd Ipd
1.69 2.15
1.69 2.15
0.46 0.58
3.84 4.88
NONE
NONE
0.12 0.15
0.60 0.77
0.72 0.92
0.81 4.08
(0.09) (3.16)

-------
                                                TABLE  D.n
                          OPTION  3 COST  ESTIMATES  (COLORADO APCD COSTS)
                                 (Thousands of  January  1978  Dollars)
                                                                                        Oxidation
Recovery Equipment
     Processing Equipment
Recovery Installation
     Processing Installation

 TOTAL INSTALLED CAPITAL

Recovery Operating Labor
     Processing Operating Labor
Recovery Utilities
     Processing Utilities
Recovery Maintenance
     Processing Maintenance
Recovery Capital Charges
     Processing Capital Charges

  TOTAL ANNUAL I ZED COST

Less: Processing Recovery Credit

  NET ANNUAL IZED COST
Bottom Loading
15,000
Ipd
2.69
43.22
0.36 >
25.93
72.20
NONE
1.43
NONE
2.17
0.09
2.59
0.48
14.02
20.78
2.19
18.59
76,000
Ipd
4.31
43.22
0.58
25.93
74.04
NONE
1.43
NONE
2.17
0.15
2.59
0.77
14.02
21.13
11.11
10.02
Top-Submerged
15.000
Ipd
3.38
43.22
0.46
25.93
73.99
NONE
1.43
NONE
2.17
0.12
2.59
0.60
14.02
20.93
2.19
18.74
76.000
Ipd—
4.30
43.22
0.58
25.93
74.03
NONE
1.43
NONE
2.17
0.15
2.59
0.77
14.02
21.13
11.11
10.02
Bottom Loading
15.000
Ipd
2.69
15.50
0.36
9.76
28.31
NONE
1.43
NONE
0.16
0.09
0.62
0.48
5.12
7.90
NONE
7.90
76,000
Ipd
4.31
15.50
0.58
9.76
30.15
NONE
1.43
NONE
0.16
0.15
0.62
0.77
5.12
8.25
NONE
8.25
Top Submerged
15,000
IpH
3.38
15.50
0.46
9.76
29.10
NONE
1.43
NONE
0.16
0.12
0.62
0.60
5.12
8.05
NONE
8.05
76,000
IP"
4.30
15.50
0.58
9.76
30.14
NONE
1.43
NONE
0.16
0.15
0.62
0.77
5.12
8.25
NONE
8.25

-------
                                                                   TABLE D.11
                                                                   Continued
                                             OPTION 3  COST ESTIMATES  (COLORADO APCD  COSTS)
                                                    (Thousands of January 1978  Dollars)
en
Recovery Equipment
     Processing Equipment
Recovery Installation
     Processing Installation
  TOTAL INSTALLED CAPITAL
Recovery Operating Labor
     Processing Operating  Labor
Recovery Utilities
     Processing Utilities
Recovery Maintenance
     Processing Maintenance
Recovery Capital Charge
     Processing Capital  Charges
  TOTAL ANNUAL IZED COST
Less: Processing Recovery  Credit
  NET.ANNUAL IZED COST
Refrigeration Plus Oxidation
Bottom Loading
15,000
Ipd
2.69
58.70
0.36
35.69
97.68
NONE
1.43
NONE
2.17
0.09
2.90
0.48
19.54
26.61
2.19
24.42
76,000
Ipd
4.31
50.70
0.58
35.69
99.28
NONE
1.43
NONE
2.17
0.15
2.90
0.77
19.54
26.96
11.11
15.85
Top-Submerged
15.000
Ipd
3.38
58.70
0.46
35.69
98.23
NONE
1.43
NONE
2.17
0.12
2.90
0.60
19.54
26.76
2.19
24.57
76,000
Ipd
4,30
58.70
0.58
35.69
99.27
NONE
1.43
NONE
2.17
0.15
2.90
0.77
19.54
26.96
11.11
15.85
                                                                                                    Oxidatjon Plus Oxidation
                                                                                                Bottom LoadTng
                                                                                               15,000      76,000
                                                                                                 Ipd         Ipd
 4.31


19^52

55.41

 NONE
 1.43
 NONE
 0.16
 0.15
 0.93
 0.77
10.24

13.68
 NONE

13.68
                                                                                                 Top Submerged
53.57

 NONE
 1.43
 NONE
 0.16
 0.09
 0.93
 0.48
10.24

13.33
 NONE

13.33
                                                                                                15.000
                                                                                                  Ipd
 3.38

3A:«
19.52
54.36
 NONE
 1.43
 NONE
 0.16
 0.12
 0.93
 0.60
10.24

13.36
 NONE
13.36
                 76,000
                   Ipd
                                                                                                                            4.30
19.52

55.40

 NONE
 1.43
 NONE
 0.16
 0.15
 0.93
 0.77
10.24

13.58
 NONE

1.1.58

-------
         APPENDIX  E
EXISTING STATE AND LOCAL VAPOR CONTROL
  REGULATIONS FOR GASOLINE MARKETING
                 E.l

-------
                                                         TABLE E.I
PO
STATE AND LOCAL REGULATION OF HYDROCARBONS
State
Alabama
Alaska
Arkansas
Arizona
California*
Bay Area
San Diego
South Coast
Colorado
Connecticut
Washington, DC
Delaware
Florida
Terminal
Loading Rack
Submerged Fill
None
None
Submerged Fill
Vapor Recovery 90%
Vapor Recovery
Vapor Recovery
Vapor Collection &
Disposal = 90%
Vapor Collection &
Disposal
Vapor Collection &
Disposal = 90%
None
None
Bulk Plant
Storage
Tank Loading
Submerged Fill
None
None
Submerged Fill
Balance & Submerged
Fill
Submerged Fill/
Balance
Submerged Fill/
Balance
Submerged Fill &
Collection = 1.15 lb/
1000 gal
Submerged Fill
Submerged Fill
& 90% Collection
None
None

Loading Rack
None
None
None
Submerged Fill
Balance & Submerged
Fill
Submerged Fill/
Balance
Submerged Fill/
Balance
Vapor Collection &
Disposal = 90%
<1 0,000 gal /day
exempted
Submerged Fill
& 90% Collection
None
None
    Service Stations
Underground Storage Tank
	Loading	
Submerged Fill
None
None
Submerged Fill

90% Collection

90% Collection

90% Collection
                                                                                         Submerged Fill & Collection
                                                                                          Equivalent to 1.15 lb/1000 gal
                                                                                         Submerged Fill
                                                                                         Submerged Fill & 90% Collection

                                                                                         None
                                                                                         None
  * Regulated by Regional Agencies

-------
TABLE E.I (continued)
STATE AND LOCAL REGULATION OF HYDROCARBONS
State
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
m Kentucky
GO
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Terminal
Loading Rack
None
None
None
Submerged Fill
Submerged Fill
None
None
90% Control
Submerged Fill
None
None
None
None
None
None
None
None

Storage
Tank Loading
None
Submerged Fill
None
Submerged Fill
Submerged Fill
None
None
Submerged Fill
Submerged Fill
None
None
None
None
Submerged Fill
None
None
None
Bulk Plant
Loading Rack
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
None
Service Stations
Underground Storage Tank
Loading
None
Submerged Fill
None
Submerged Fill
Submerged Fill
None
None
Submerged Fill
Submerged Fill
None
None
None
None
Submerged Fill
None
None
None

-------
m
State
Nebraska
Nevada
New Hampshire
New Jersey

New Mexico
New York
North Carolina
North Dakota
Ohio
• »«•
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
  Termi nal
Loading Rack
None
Submerged Fill
None
Submerged Fill
 (Region requires
 90% control)
None
None
Submerged Fill
Submerged Fill
Vapor Collection
 & Recovery
Bottom Loading
None
Vapor Collection
Submerged Fill
None
None
                                                 TABLE E.I  (continued)
                                        STATE AND LOCAL  REGULATION OF HYDROCARBONS
                                        	Bulk  Plant	
                                           Storage
                                        Tank Loading
None
Submerged Fill
None
Submerged Fill

None
None
None
Submerged Fill
Submerged Fill
Submerged Fill
None
Submerged Fill
Submerged Fill
None
None
Loading Rack
None
Submerged Fill
None
Submerged Fill

None
None
None
None
None

Submerged Fill
None
None
None
None
None
    Service Stations
Underground Storage Tank
	Loading	
None
Submerged Fill
None
90% Collection
None
None
None
Submerged Fill
Submerged Fill
Submerged Fill
None
Submerged Fill
Submerged Fill
None
None

-------
                                               TABLE E.I  (continued)
State
Tennessee
Texas
Utah
Virginia
Vermont
Washington
West Virginia
Wisconsin
Wyomi ng
Terminal
Loading Rack
None
Vapor Recovery
None
Vapor Control
None
None
None
None
None
STATE AND LOCAL

Storage
Tank Loading
None
Submerged Fill
None
None
None
None
None
None
Submerged Fill
REGULATION OF HYDROCARBONS
Bulk Plant
Loading Rack
None
None
None
None
None
None
None
None
None
Service Stations
Underground Storage Tank
Loading
None
Submerged Fill
None
None
None
None
None
None
Submerged Fill
Source: U.S. Environmental  Protection Agency

-------
APPENDIX   F
CASH FLOW WORKSHEETS
          F.I

-------
                                                      TABLE F.I

CASH
FOR LARGE
FLOW WORKSHEET
MARINE TERMINAL1
(Thousand dollars/year)
PRIMARY SYSTEM
BJ
Present Term Debt 2
New Term Debt 3
Total Debt
Pre-Tax Profit4
Interest Expense5
Vapor Control Operating Expense
Adjusted Net Profit (BFIT)
Tax @ 50%
»
Adjusted Net Profit (AFT)
Present Depreciation
Vapor Control Equipment Depreciation
Total Depreciation
Estimated Cash Flow
Debt as % of Cash Flow (Pre Control)
Debt as % of Cash Flow (Post Control)
EFRIGERATIQN
58.9
38.3
97.2
840.0
(8.2)
35.7
867.5
(433.8)
433.8
118.8
30.6
149.4
583.2
11%
17%
INCINERATION
58.9
23.8
82.7
869.2
(6.9)
(19.7)
842.6
(421. 3)
421.3
118.8
19.0
137.8
559.1
11%
15%
PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
58.9
54.0
112.9
882.0
(9.6)
22.9
895.3
(447.7)
447.7
118.8
43.2
162.0
609.7
11%
19%
WITH STANDBY
INCINERATION/
INCINERATION
58.9
39.5
98.4
907.5
(8.3)
(28.5)
870.7
(435.4)
435.4
118.8
31.6
150.4
585.8
11%
17%
2Assumes competitive pass through
g30% of net plant investment
^100% debt financing of vapor control equipment
5Ann-ual throughput times adjusted tariffs less pre-vapur control operating expense
sJl^T!811?611? mort9a9ed for 20 years @ 8%-, vapor control equipment mortgaged for 8 years (?
^Adjusted to include recovery credit   .
 10 year operating life

-------

CASH FLOW WORKSHEET
FOR. SMALL MARINE TERMINAL1
(Thousand dollars/year)
PRIMARY SYSTEM
REFRIGERATION INCINERATION
29.3
25.5
54.8
426.0
(.4.6)
13.5
434.9
(217.5)
217.5
7 54.6
n 20.4
75.0
292.5
12%
) 19%
29.3
i8.0
47.3
436.0
(4.0)
(14.1)
417.9
(209.0)
209.0
54.6
14.4
69.0
278.0
12%
17%
PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
29.3
37.4
66.7
448.8
(5.7)
4.8
447.9
(224.0)
224.0
54.6
29.9
84.5
308.5
12%
22%
WITH STAND-BY
INCINERATION/
INCINERATION
29.3
29.9
59.2
457.0
(5.0)
(20.8)
431.2
(215.6)
215.6
54.6
23.9
78.5
294.1
12%
20%
 Present Term
 New Term Debt
 Total  Debt
 Pre-Tax Profit 4 ,.
 Interest Expense b              ,
 Vapor Control  Operating Expense
 Adjusted Net Profit (BFIT)
 Tax (a 50%
 Adjusted Net Profit (AFT)

 Present  Depredation
 Vapor Control  Equipment Depreciation
 Total Depreciation
 Estimated Cash Flow
Debt as % of Cash Flow (Pre  Control)
Debt as % of Cash Flow (Post Control)
 .^Assumes competitive pass through
 ^30% of net plant investment
      debt financing of vapor control  equipment
        throughput times adjusted tariffs less  ore-vapor  control.operating expense
 ,,,«„, investment mortgaged  for 20 years e 8%;  vapor  control  equipment mortgaged for 8 years 9 9A
 ^Adjusted to include recovery credit
 10 year operating  life

-------
                                                       TABLE F.3
  Present Term  Debt
  New Term Debt3
  Total Debt
 Pre-Tax Profit   c
 Interest Expense0
 Vapor Control Operating Expense
 Adjusted Net Profit (BFIT)
 Tax @ 50%
*
"Adjusted Net Profit (AFT)
 Present  Depreciation
 Vapor Control  Equipment Depreciation
 Total  Depreciation
 Estimated Cash Flow
Debt as % of Cash Flow (Pre Control)
Debt as % of Cash Flow (Post Control)
oAssumes  competitive  pass through

CASH FLOW WORKSHEET


FOR LARGE PIPELINE TERMINAL1


(Thousand dollars/year)
PRIMARY SYSTEM
REFRIGERATION INCINERATION
37.1
38.3
75.4
544.4
(6.4)
35.7
573.7
286.9
286.9
7 84.4
i 30.6
HJLJ)
401.9
11%
) 19%
37.1
23.8
60.9
573.6
(5.1)
(19.7)
548.8
274.4
274.4
84.4
19.0
103.4
377.8
11%
16%

PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
37.1
.54J3
91.1
586.9
(7.8)
22.9
602.0
301.0
301.0
84.4
43.2
127.6
428.6
11%
21%

WITH STAND-BY
INCINERATION/
INCINERATION
37.1
39 J[
76.6
612.0
(6.5)
(28.5)
577.0
288.5
288.5
84.4
31.6
116.0
404.5
11%
19%
o    of net plant investment
?100% debt financing  of vapor  control equipment
rAnnual throughput times adjusted  tariffs less pre-vapor control operating expense
cPlant investment mortgaged for  20 years @ 8%; vapor control equipment mortgaged for 8 years @ 9%
Adjusted to include recovery  credit
 10 year operating life

-------
                                                         TABLE F.4
en





CASH FLOW WORKSHEET
FOR SMALL PIPELINE TERMINAL1
(Thousand dollars/year)
PRIMARY SYSTEM

REFRIGERATION INCINERATION
14.8
25.5
40.3
226.9
(3.5)
13.5
236.9
(118.5)
118.5
, 32.0
i 20.4
52.4
170.6
11%
) 24%
14.8
18.0
32.8
237.0
(2.8)
(14.1)
220.1
(110.1)
110.1
'' 32 . 0
14.4
46.4
156.5
11%
21%



PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
14.8
37.4
52.2
249.8
(4.6)
4.8
250.0
(125.0)
125.0
32.0
29.9
61.9
186.9
11%
28%



WITH STAND-BY
INCINERATION/
INCINERATION
14.8
29.9
44.7
258.0
(3.9)
(20.8)
233.3
(116.7)
116.7
32.0
23.9
55.9
172.6
11%
26%
    Present Terra Debt
    New Term

    Total  Debt
Pre-Tax Profit   ,.
Interest Expense5
Vapor Control Operating Expense

Adjusted Net Profit (BFIT)

Tax @ 50%

Adjusted Net Profit (AFT)
   Present Depreciation
   Vapor Control Equipment Depreciation

   Total Depreciation

   Estimated Cash Flow

   Debt as  %  of Cash  Flow  (Pre  Control)

   Debt as  %  of Cash  Flow  (Post Control)

  ^Assumes competitive pass through
  .,30% of net plant investment
  .100% debt financing of vapor control equipment
  rAnnual throughput times adjusted tariffs less pre-vapor control  operating  expense
  gPlant investment mortgaged for 20 years @ 8%; vapor control  equipment mortgaged  for  8 years  @  9%
  ^Adjusted to include recovery credit
   10 year operating life

-------
                                                          TABLE F.5
BALANCE
INCOMING
ONLY
4.3
0.9
5.2
28.0
(0.4)
2.4
30.0
(15.0)
15.0
? 6.2
in 0.4
6.6
21.6
) 23%
il) 24%
CASH FLOH
FOR LARGE BULK
MOMSHEET
PLANT ( NO JC COSTS)1
(Thousand dollars/year)
BALANCE PRIMARY
INCOMING &
OUTGOING REFRIGERATION
4.3
5.1
9.4
32.6
(0.9)
2.9
34.6
(17.31
17.3
6.2
2.6
8.8
26.1
23%
.36%
•4.3
19.0
23.3
51.0
(2.4)
1.0
49.6
(24.8)
24.8
6.2
9.5
15.7
40.5
23%
58%
SYSTEM
INCINERATION
4.3
10.2
14.5
46.0
(1.5)
(4.4)
40.1
(20.1)
20.1
6.2
5.1
11.3
31.4
23%
46%
• PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
4.3
24.0
28.3
58.9
(3.0)
(0.9)
55.0
(27.5)
27.5
6.2
12.0
18.2
45.7
23%
62%
WITH STAND-BY
INCINERATION/
INCINERATION
4.3
15.3
19.6
53.3
(2.0)
(5.7)
45.6
(22.8)
22.8
6.2
7.6
13.8
36.6
23%
54%
    Present Term Debt2
    New Term Debt 3

    Total Debt
    Pre-Tax Profit4 5
    Interest  Expense a
    Vapor Control Operating Expense

    Adjusted  Net Profit  (BFIT)
TI
o>   Tax @ 50%

    Adjusted  Net Profit  (AFT)



    Present Depredation                /
    Vapor Control Equipment Depreciation  0.4

    Total Depredation

    Estimated Cash Flow

    Debt'as % of Cash Flow (Pre Control)  23%

    Debt as % of Cash Flow (Post Control)  24%

   lAssunies competitive  pass through
   ,60% of net  plant  investment
   ^100% debt financing  of vapor control equipment
   Annual throughput times adjusted tariffs less pre-vapor control  operating  expense
   Slant investment  mortgaged  for 20 years 0 9%; vapor control  equipment mortgaged  fo4 5 years 9 1U
    ^Mjusted  to include  recovery credit
    10 year   operating life.

-------
                                                        TABLE F.6
CASH FLOW WORKSHEET




2
Present Term Debt
NPW Tprm D*»ht
Total Debt
Pre-Tax Profit4 5
Interest Expense g
Vann *» f* An +• v*n1 Hno »*a ^ 1 n n P v none A
Adjusted Net Profit (BFIT)
T-y A CM
I OA I? 3U»
Adjusted Net Profit (AFT)
FOR LARGE

BALANCE
INCOMING
ONLY
4.3
0.9
5.2
28.0
(0.5)
2.4
29.9
(15.0)
15.0
Present Depreciation 76 -2
V/annr- Pnntr>n1 Fnili nmont Dpfi TPC.! flt 1 00 0.4
Total Depreciation 6.6
Estimated Cash Flow
Debt as % of Cash Flow (Pre Control
HoKt AC °L nf fa«;h Flow (Post Contrc
21.6
) 23%
il )24%
BULK PLANT (HOUSTON-GALVESTON COSTS)1
(Thousand dollars/year)
BALANCE
INCOMING &
OUTGOING
4.3
2.6
6.9
29.1
(0.7)
3.4
31.8
(15.9)
15.9
6.2
1.3
7.5
23.4
23%
29%
PRIMARY

REFRIGERATION
4.3
16.4
20.7
47.7
(2.2)
1.2
46.7
(23.4)
23.4
6.2
8.2
14.4
37.8
23%
55%
SYSTEM

INCINERATION
4.3
7.6
11.9
42.6
(1.2)
(4.1)
37.3
(18.7)
18.7
6.2
3.8
1 0 .0
28.7
23%
41%
PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
4.3
21.5
25.8
55.6
(2.8)
(0.6)
52.2
(26.1)
26.1
6.2
10.7
16.9
43.0
23%
60%
WITH STAND-BY
INCINERATION/
INCINERATION
4.3
12.7
17.0
49.9
(1.8)
(5.4)
42.7
(21.41
21 .4
6.2
6.4
12.6
34.0
23%
50%
 Assumes competitive pass through
o60% of net plant investment
•?100% debt financing of vapor control  equipment                           QvnQnCQ
%nual throughput times adjusted tariffs less pre-vapor control  operating expense
^Plant investment mortgaged for 20 years 0 9%; vapor control  equipment mortgaged for 5
^Adjusted tn include recover" credit
 10 year operating  ]ife
years @ 11%

-------
TABLE F.7



CASH
FLOW WORKSHEET
FOR LARGE BULK PLANT (COLORADO APCD

COSTS)1




(Thousand dollars/year)





•



2
Present Term Debt
New Term Debt
Total Debt
4
Pre-Tax Profit 5
Interest Expense
Vapor Control Operating Expense b
Adjusted Net Profit (BFIT)
Tax 0 50%
Adjusted Net Profit (AFT)

BALANCE
INCOMING
ONLY
4.3
o ,1
4.6
27.3
(0.4)
2 5

29.4
(11/71
14.7

Present Depredation . 7°'£
Vapor Control Equipment Depreciation^



T.^
|
c
s"
8
Total Depredation
Estimated Cash Flow
Debt as % of Cash Flow (Pre Control
Jbl
21.1
) 23%
Debt as % of Cash Flow (Post Control )22%
^Assumes competitive pass through

BALANCE
INCOMING &
OUTGOING
4.3
_1?P=
5.3
26.8
(0.5)
3.7
30.0
(15,01
15.0
60
. c.
0.5

6.7

21.7
23%
24%

PRIMARY
REFRI-GERATION
4.3
14.8
19.1
45.2
(2.0)
1.8

45.0
(22.5)
22^5
6 ">
7.4

13.6
___—
36.1
23%
53%

SYSTEM
INCINERATION
4.3
6.0

10.3
69.5
(i.o)
(3.6)
64.9
(32.5)
32.5
6.2
3.0

9.2

41.7
23%
25%

PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
4.3
19.9

24.2
53.1
(2.6)
(0.1)

50.4
(25.2)
25.2
6.2
9.9

16.1

41.3
23%
59%

WITH STAND-BY
INCINERATION/
INCINERATION
4.3
11.1

15.4
47.5
(1.6)
(4.9)

41.0
(20.5)

20.5
6.2
5.5

11.7

32.2
23%
48%

^60% of net plant investment
^inn% Hpht financing of vapor control equipment
«iuu/o ueui. i many, iny^wi *"r. ... • r- f n 	 	 .,,„«,/, /-nn + vnl nnoratinn PYnpn<;p
rAnnual throughput times adjusted i
;ariTTS ie:
v/oa^c 0 Q<
«. [)'„" £on1
:rol equipment me
)rtgaged for 5 y»
=ars (?!!%

^Adjusted to include recovery credit
10 year operating life

-------
                                                           TABLE F.8
CASH FLOW WORKSHEET
FOR SMALL BULK PLANT (NOJC
BALANCE
INCOMING
ONLY
1.7
0.9
2.6
11.4
(0.3)
0.3
11.4
(5.7)
5.7
72.3
i 0.4
2.7
8.4
21%
)31%
(Thous
BALANCE
INCOMING &
OUTGOING
1.7
4.6
6.3
12.4
(0.7)
(0.2)
11.5
(5.8)
5.8
2.3
2.3
4.6
10.4
21%
61%
COSTS)1
and dollars/year)
PRIMARY SYSTEM
REFRI-GERATION
1.7
18.4
20.1
16.0
(2.2)
(7.8)
6.0
(3.0)
3.0
2.3
9.2
11.5
14.5
21%
139%
INCINERATION
1 .7
9.7
11.4
15.0
(1.2)
(4.3)
9.5
(4.8)
4.8
2.3
4.8
7.1
11.9
21%
96%
PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
1.7
23.5
25.2
17.6
(2.7)
(9.3)
5.6
(2.8)
2.8
2.3
11.7
14,0
16.8
21%
150%
WITH STAND-BY
INCINERATION/
INCINERATION
1.7
14.7
16.4
16.5
(1.8)
(5.6)
9.1
(4.6)
4.6
2.3
7.4
9.7
14.3
21%
115%
   Present Term Debt
   New Term Debt3

   Total  Debt
   Pre-Tax  Profit4
   Interest Expense5
   Vapor  Control  Operating  Expense

   Adjusted Net  Profit  (BFIT)
~n

10  Tax @  50%

   Adjusted Net  Profit  (AFT)



   Present  Depreciation                f
   Vapor  Control  Equipment Depreciation 0.4

   Total   Depreciation

   Estimated Cash Flow

  Debt as % of Cash Flow (Pre Control) 21

  Debt as % of Cash Flow (Post Control

   ..Assumes competitive pass through
   360% of  net plant investment
   4100%  debt financing of vapor control  equipment
   cAnnual  throughput times  adjusted tariffs less pre-vapor control  operating expense
   gPlant investment mortgaged for 20 years @ 9%; vapor control  equipment mortgaged for 5 years
   -flHi'ustPd tn include rpcnverv crprlit
   10 year operating life

-------
                                                            TABLE F.9
CASH FLOW WORKSHEET
FOR
BALANCE
INCOMING
ONLY
1.7
0.9
2.6
11.4
(0.3)
0.3
11.4
(5.7)
5.7
T2'3
/0.4
2.7
8.4
| 21%
1)31%
SMALL BULK PLANT (HOUSTON-GLAVI
(Thousand
BALANCE
INCOMING &
OUTGOING
1.7
2.1
3.8
11.6
(0.4)
0.1
11.3
J&D
5.7
2.3
1.1
3.4
9.1
21%
42%
ESTON COSTS)1
dollars/year)
PRIMARY SYSTEM
REFRI-GERATION
T.7
16.0
17.7
15.4
(1.9)
(7.5)
6.0
(3.0)
-" 3.0
2.3
8.0
10.3
13.3
21%
133%
INCINERATION
1.7
7.2
8.9
14.4
(0.9)
(4.0)
9.5
(4.8)
4.8
2.3
3.6
5.9
10.7
21%
83%
PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
1.7
21.0
22.7
17.0
(2.5)
(8.9)
5.6
(2.8)
2.8
2.3
10.5
12.8
15.6
21%
146%
WITH STAND-BY
INCINERATION/
INCINERATION
1.7
12.2
13.9
15.8
(1.5)
(5.3)
9.0
(4.5)
4.5
2.3
6.1
8.4
12.9
21%
108%
   Present Term Debt'
   New Term DebtJ
   Total Debt
   Pre-Tax Profit * ,-
   Interest Expense
   Vapor Control Operating Expense
   Adjusted Net Profit (BFIT)
*n
'o  Tax 9 50%
   Adjusted Net Profit (AFT)
   Present Depreciation
   Vapor Control Equipment Depreciation'0.4
   Total Depreciation
   Estimated Cash Flow
   Debt as % of Cash Flow (Pre Control) 21%
   Debt as % of Cash Flow (Post Control)31%
   -Assumes competitive pass through
   ^60% of net plant investment
   flOO%  debt financing of vapor control equipment
   ^Annual throughput times adjusted tariffs less pre-vapor control operating expense
   .Plant investment mortgaged for 20 years @ 9%; vapor control equipment mortgaged for 5 years  0
   ^Adjusted to  include recovery credit
     10 year operating life

-------
                                                     CASH FLOW WORKSHEET
FOR

BALANCE
INCOMING
TT ONLY
1.7
0.3
2.0
11.3
(0.2)
0.4
11.5
(5.8)
5.8
72.3
i 0.2
2.5
8.3
21%
)24%
SMALL BULK PLANT
(Thousand
BALANCE
(COLORADO APCD COSTS)1
dollars/year)

PRIMARY SYSTEM
INCOMING &
OUTGOING TT REFRI-GERATION
1.7
0.8
2.5
11.2
(0.2)
0.5
11.5
(5.8)
5.8
2.3
0.4
2.7
8.5
21%
29%
1.7
14.6
16.3
14.9
(1.8)
(7.0)
6.1
(3.1)
3.1
2.3
7.3
9.6
12.7
21%
128%
INCINERATION
1.7
5.8
7.5
19.7
(0.8)
(3.5)
15.4
(7.7)
7.7
2.3
2.9
5.2
12.9
21%
58%

PRIMARY SYSTEM
REFRIGERATION/
INCINERATION
1.7
19.6.
21.3
16.4
(2.3)
(8.5)
5.6
(2.8)
2.8
2.3
9.8
12.1
14.9
21%
143%

WITH STAND-BY
INCINERATION/
INCINERATION
1.7
10.9
12.6
15.3
(1.4)
(4.8)
9.1
(4.6)
4.6
2.3
5.4
7.7
12.3
21*
102%
 Present Term  Debt'
 New Term  Debt

 Total Debt
Pre-Tax Profit   5
Interest Expense                6
Vapor Control Operating Expense

Adjusted Net Profit  (BFIT)

Tax @ 50%

Adjusted Net Profit  (AFT)



Present Depreciation                .  .-
Vapor Control Equipment Depreciation 0.2

Total Depreciation

Estimated Cash Flow

Debt as % of Cash Flow (Pre Control)

Debt as % of Cash Flow (Post Control

^Assumes competitive pass  through
360% of net plant investment
^100% debt financing of vapor control  equipment
gAnnual throughput times adjusted tariffs  less pre-vapor control opearting expense
gPlant investment mortgaged for 20 years @ 9%; vapor control equipment mortgaged for 4 years 9 11%
7Adjusted to include recovery credit
 10 year operating life

-------
        APPENDIX   G
VAPOR CONTROL IMPACTS ON PROTOTYPICAL
        BULK STORAGE FACILITIES
                G.I

-------
                                      TABLE G.I
VAPOR CONTROL COSTS AT LARGE MARINE TERMINALS1
(Thousand dollars)

TYPE PRIME SYSTEM
Back-up System
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Vapor Control
Vapor Control Operating
Expenses
Utilities
M & R
Taxes, Insurance, G
Recovery Credit
Net Expenses
Unit Operating Expenses
- Gasoline Only
Pre Control
Post Control
REFRIGERATION
VAPOR RECOVERY
NO
3926.4

306.0

4232.4


19.8
10.7
&A 12.2
(78.4)
(35.7)
($/Gal)

.00288
.00268
Tari f f Increase/ (DecreaseX . 00020)

INCENERATION
NO
3926.4

190.0

4116.4


6.8
5.3
7.6
—
19.7


. 00288
.00299
.00011
REFRIGERATION
VAPOR RECOVERY
YES
3926.4

432.0

4358.4


19.8
14.5
17.3
(74.5)
(22.9)


.00288
.00275
(.00013)
NO PASS THROUGH CASE

ROI Impact
2
Total Terminal Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income-Post Control
ROI
(Thousand

1795.3
(987.2)
( 17.7)
787.2
18.64%
dollars)

1795.3
(987.2)
( 52.9)
752.0
18.31%


1795.3
(987.2)
( 52.5)
752.4
17.30%
% Increase/ (Decrease) over
Pre Control Case
( 9.3%)
(10.9%)
(15. R%)
1'Gasoline Ihrougnput - 500,000 gallons/cb.y
2 Target Tariff = $.00523/Gal.
3 Includes principle and interest  payments .for  vapor  control  equipment.
                                                                          INCINERATION

                                                                                YES
                                                                              3926.4

                                                                               316.0
                                                                              4242.4
                                                                                 6.8
                                                                                 9.1
                                                                                12.6

                                                                                28.5
                                                                              ,00288
                                                                              .00304
                                                                              .00016
                                                                              1795.3
                                                                              (987.2)
                                                                              (  83.6)
                                                                               721.3
                                                                               17.04%

                                                                              (17.0%)
                                        G.2

-------
                                    TABLE G.I (continued)
                  VAPOR CONTROL COSTS AT LARGE MARINE TERMINALS

(Thousand
REFRIGERATION
TYPE PRIME SYSTEM VAPOR RECOVERY
Back-up System
Capital Recovery Requirement
Pre Control'
0
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
NO
806.5
73.0
879.5
987.2
(35.7)
954.7
dollars)
INCINERATION
NO
806.5
45.3
851.3
987.2
19.7
1010.1

REFRIGERATION
VAPOR RECOVERY
YES
806.5
103.0
909.5
987.2
(22.4)
968.0

INCINERATION
YES
806.5
75.4
881.9
987.2
28.5
1018.9
FULL PASS THROUGH CASE

(Thousand
dollars)


Gasoline Tariff Required ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control Operating
Expenses
Gasoline Tariff Required-
Post Control
% Increase/(Decrease) over
Pre Control Case
.00523
.00040
(.00020)
.00543
3.8%
.00523
.00025
.00011
.00559
6.9%
.00523
.00056
(.00013)
.00566
8.2%
.00523
.00041
.00016
.00580
10.9%
1
 20% BFIT,  20 years
120% BFIT,  10 years
                                        G.3

-------
                                       -TABLE G.2
VAPOR CONTROL COSTS AT SMALL MARINE
TERMINAL1
(Thousand dollars)
REFRIGERATION
TYPE PRIME SYSTEM VAPOR RECOVERY INCINERATION
Back-up System
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Vapor Control
Vapor Control Operating
Expenses
Utilities
M & R
Taxes, Insurance, G & A
Recovery Credit
Net Expenses
Unit Operating Expenses ($/Gal)
- Gasoline Only
Pre Control
Post Control
Tariff Increase/ (DecreaseX

ROI Impact
2
Total Terminal Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income-Post Control
ROI
NO
1951.6
204.0
2155.6
9.9
7.6
8.2
(39.2)
(13.5)
.00394
.00379
.00011)
NO PASS THROUGH
(Thousand dol
904.8
(502.9)
( 22.1)
377.8
17.53%
NO
1951.6
144.0
2095.6
3.9
4.4
5.8
--
' 14.1
.00394
.00401
.00011
CASE
lars)
904.8
(502.9)
(.39.2)
360.7
17. 21*
REFRIGERATION
VAPOR RECOVERY
YES
1951.6
299.0
2250.6
9.9
10.5
12.0
(37.2)
(4.8)
.00394
.00386
(.00004)

904.8
(502.9)
( 47.4)
352.5
15.66%
% Increase/(Decrease)  over
  Pre Control  Case
1
(14.8%)
(16.2%)
(23.7%)
^Gasoline Throughput - 250,000 gallons/day
parget Tariff = $.00708/gallon
 Includes principle and interest payments for vapor control equipment
                                                                           INCINERATION


                                                                                YES

                                                                               1951.6


                                                                               239.0
                                                                              2190.6
                                                                                  3.9
                                                                                  7.3

                                                                                  9.6
                                                                                 20.8
                                                                               .00394

                                                                               .00406

                                                                               .00016
 904.8

(502.9)

( 62.5)
 337.4

 15.40%


(25.0%)
                                         G.4

-------
                                    TABLE G.2 (continued)
VAPOR CONTROL COSTS AT SMALL MARINE
(Thousand dollars)
REFRIGERATION
TYPE PRIME SYSTEM VAPOR RECOVERY INCINERATION
Back-up System
Capi tal Recovery Requi rement
Pre Control
p
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff Required ($/Gal
Pre Control
Vapor Control Capital
Recovery
Vapor Control Operating
Expenses (
Gasoline Tariff Required-
Post Control
% Increase/(Decrease) over
f>y*a Print rnl P.a^p
NO
400.9
48.7
449.6
502.9
(13.5)
NO
400.9
34.3
435.2
502.9
14.1
489.4 517.0
FULL PASS THROUGH CASE
(Thousand
)
.00708
.00038
.00011)
.00735
3.8%
dollars)
.00708
.00027
.00011
.00746
5.4%
TERMINAL
REFRIGERATION
VAPOR RECOVERY
YES
400.9
71.3
472.2
502.9
(4.8)
498.1
.00708
.00056
(.00004)
.00760
7.4%
                                                                          INCINERATION
                                                                              YES
                                                                              400.9

                                                                               57.0

                                                                              457.9
                                                                              502.9

                                                                               20.8

                                                                              523.7
                                                                             .00708


                                                                             .00045


                                                                             .00015


                                                                             .00769


                                                                              8.7%
1
 20% BFIT, 20 years
:20% BFIT, 10 years
                                       G.5

-------
                                        TABLE G.2  (continued)

                       VAPOR CONTROL COSTS AT SMALL MARINE  TERMINAL
                                    (Thousand dollars)



                            COMPETITIVE  PASS-THROUGH CASE
    TYPE PRIME  SYSTEM

Gasoline Tariff ($/Gal)

    Pre-control
    Full Pass-through of
    most efficient unit

    Gasoline Tariff -
    Post Control
REFRIGERATION                   REFRIGERATION
VAPOR RECOVERY  INCINERATION    VAPOR RECOVERY   INCINERATION
   .00708
   .00020
   .00728
 .00708
 .00036
 .00744
 .00708
 .00043
 .00751
 .00708
 .00057
 .00765
% Increase/(Decrease) over
  Pre-control  Case
     2.8%
   5.1%
   6.1%
   8.1%
ROI Impact

Total  Terminal  Revenue

Expenses - Pre-Control
                       2
Expenses - Vapor  Control

Net Income -  Post Control
923.1
(02.9)
( 22.1)
937.7
(502.9)
( 39.2)
944.1
(502.9)
( 47.4)
956.9
(502.9)
( 62.5)
   398.1
 395.6
 393.8
 391.5
ROI
   18.44%
 18.85%
 17.47%
 17.84%
% Increase/(Decrease) over
  Pre-Control  Case
  ( 10.2%)
(   8.2%)
(  14.9%)
(  13.1%)
 1
        on above gasoline tariffs
  Includes principle and interest  payments  for vapor control  equipment
                                           G.6

-------
TABLE G.3
VAPOR CONTROL COSTS AT LARGE PIPELINE TERMINAL1
^Thousand dollars)
TYPE PRIME SYSTEM
Back-up System
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Vapor Control
Vapor Control Operating
Expenses
Utilities
M & R
Taxes, Insurance, G
Recovery Credit
Net Expenses
Unit Operating Expenses
- Gasoline Only
Pre Control
Post Control
REFRIGERATION
VAPOR RECOVERY
NO
2473.1
306.0
2779.1
19.8
10.7
& A 12.2
(78.4)
(35.7)
l$/Gal)
.00243
.00223
Tariff Increase/ ( Decrease X- 00020)
INCENERATION
NO
2473.1
190.0
2653.1
6.8
5.3
7.6
19.7
.00243
.00254
.00011
REFRIGERATION
VAPOR RECOVERY
YES
2473.1
432.0
2905.1
19.8
14.5
'17.3
(74.5)
(22.9)
.00243
.00230
(.00013)
NO PASS THROUGH CASE

ROI Impact
z
Total Terminal Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income-Post Control
ROI
(Thousand
1240.6
(732.3)
( 17.7)
490.0
17.64%
dollars)
1240.6
(732.3)
( 52.9)
454.8
17.09%

1240.6
(732.3)
( 52.5)
455.2
15.68%
                       (23.7*)
% Increase/(Decrease) over                      •
  Pre Control  Case              (  14.1%)         (16.8%)
 Icasoline Throughput - 500,000  gallons/day
 ^Target Tariff = $.004127galIon
 ^Includes principle  and  interest  payments for  vapor control equipment
                                   INCINERATION

                                       YES
                                       2473.1

                                        316.0
                                       2789.1
                                          6.8
                                          9.1
                                         12.6

                                         28.5
                                        .00243
                                        .00259
                                        .00016
1240.6
(732.3)
(  83.6)
 424.1
 15.22%

(  25.9%)
  G.7

-------
                                 TABLE  G.3  (continued)
                VAPOR CONTROL  COSTS  AT LARGE PIPELINE  TERMINAL
(Thousand dollars)
REFRIGERATION
TYPE PRIME SYSTEM VAPOR RECOVERY INCINERATION
Back-up System
Capital Recovery Requirement
Pre Control
9
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
NO
508.0
73.0
581.0
732.3
(35.7)
NO
508.0
45.3
553.0
732.3
19.7
696.4 752.0
FULL PASS THROUGH CASE
(Thousand
Gasoline Tariff Required ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control Operating
Expenses
Gasoline Tariff Required-
Post Control
% Increase/ (Decrease) over
Pre Control Case
.00412
.00040
(.00020)
.00432
4.9%
dollars)
.00412
.00025
.00011
.00448
8.7%
REFRIGERATION
VAPOR RECOVERY
YES
508.0
103.0
611.0
732.3
(22.9)
709.4
.00412
.00056
(.00013)
.00455
10.4%
                                                                          YES
                                                                          508.0
                                                                           75.4
                                                                          583.4
                                                                          732.3
                                                                           28.5
                                                                          760.8
                                                                          .00412

                                                                          .00041

                                                                          .00016

                                                                          .00469

                                                                          13.8%
BFIT, 20 years
BFIT, 10 years
                                    G.8

-------
                                       TABLE  G.4
VAPOR CONTROL COSTS AT SMALL PIPELINE TERMINAL1
(Thousand dollars)

TYPE PRIME SYSTEM
Back-up System
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Vapor Control
Vapor Control Operating
Expenses
Utilities
M & R
Taxes, Insurance, G
Recovery Credit
Net Expenses
Unit Operating Expenses
- Gasoline Only
Pre Control
Post Control
REFRIGERATION

VAPOR RECOVERY INCENERATION
NO
989.9
204.0
1193.9


9.9
7.6
& A 8'2
(39.2)

(13.5)
($/Gal)

.00305
.00294
Tariff Increase/(0ecrease)(. 00011 )


ROI Impact
Total Terminal Revenue ^
Expenses-Pre Control
Expenses-Vapor Control
Net Income-Post Control
Rm
NO PASS THROUGH
(Thousand doll

627.0
(423.5)
( 22.1)

181.0
15.18%
NO
989.9
144.0
1133.9


3.9
4.4
5.8
--

14.1


.00305
.00316
.00011
CASE
ars)

627.0
(423.5)
r 39. n

164.9
14.47%
REFRIGERATION
VAPOR RECOVERY
YES
989.9
299.0
1288.9


9.9
10.5
12.0
(37.2)

( 4.S)


.00305
.00296
(.00004)



627.0
(423.5)
( 47.4)

155.7
12.10%
% Increase/(Decrease) over
  Pre Control  Case
1
                                (28,1$)
(29.5%)
(41.1
'Gasoline Throughput - 250,000 gallons/day
^Target Tariff = $.00451/gallon                                .
Includes principle and interest payments for vapor control  equipment
                                                                           INCINERATION

                                                                               YES
                                                                               989.9

                                                                               239.0
                                                                              1228.9
                                                                                  3.9
                                                                                  7.3
                                                                                  9.6

                                                                                 20.8
                                                                               .00305
                                                                               .00321
                                                                               .00016
 627.0
(423.5)
(  62.5)
 140.6
 11.46%

(44.2%)
                                         G.9

-------
                                     TABLE G.4 (continued)
                   VAPOR CONTROL COSTS AT SMALL PIPELINE TERMINAL

(Thousand
REFRIGERATION
TYPE PRIME SYSTEM VAPOR RECOVERY
Back-up System
Capital Recovery Requirement
Pre Control
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
NO
203.3
48.7
252.0

423.5
(13.5)
410.0
dollars)
INCINERATION
NO
203.3
34.3
237.6

423.5
14.1
437.6

REFRIGERATION
VAPOR RECOVERY
YES
203.3
71.3
274.6

423.5
(4.8)
418.7
FULL PASS THROUGH CASE

Gasoline Tariff Required ($/Gal
Pre Control
Vapor Control Capital
Recovery
Vapor Control Operating
Expenses (
Gasoline Tariff Required-
Post Control
% Increase/ (Decrease) over
Pre Control Case
(Thousand
)
.00451
.00038
.00011)
.00478
S.0%
dollars)
.00451
.00027
.00011
.00489
8.4%

.00451
.00056
(.00004)
.00503
11.5%
                                                                              YES
                                                                              203.3
                                                                               57.0
                                                                              260.3
                                                                              423.5
                                                                               20.8
                                                                              444.3
                                                                             .00451

                                                                             .00045

                                                                             .00016

                                                                             .00512

                                                                              13.5%
1
 20% BFIT, 20 years
-20% BFIT, 10 years
                                        G.10

-------
                                           TABLE  6.5
VAPOR CONTROL COSTS (NOJC) AT LARGE BULK PLANTS1
(Thousand dollars)
OPTION
TYPE PRIMARY
SYSTEM

TYPE LOADING '
BACK-UP SYSTEM
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Control
Vapor Control Operating
Expenses
Utilities
Labor
N & R
Mis., Taxes, Ins. , G &
Recovery Credit
Net Expenses
1
BALANCE
Incoming
TT Only
TOP
NO
143.00
4.25
147.25

--
0.07
A 0.17
(2.59)
(2.35)
3
BALANCE
4
REFRIG-
ERATION
4
INCIN-
ERATION
Incoming VAPOR
& Outgo- CONTROL
ing Trucks
TOP
NO
143.00
25.73
168.73

--
0.17
1.03
(4.08)
(2.88)
TOP
NO
143.00
94.88
237.88
2.17
1.43
2.76
3.80
(11.11)
( 1.00)
TOP
NO
143.00
50.99
193.99
0.16
1.43
0.79
2.04
__
4.42
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
143.00
120.12
263.12
2.17
1.43
3.07
4.80
(10.55)
0.92
4
INCIN-
ERATION

TOP
YES
143.00
76.25
219.25
0.16
1.43
1.10
3.05
^ —
5.74
Unit Operating Expenses ($/Gal)
- Gasoline Only
Pre Control
Post Control
Increase/ (Decrease)
ROI Impact
y
Bulk Plant Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income- Post Control
Dnr/pnp
.01486
.01454
(.00032)
NO PASS
.01486
.01447
(.00039)
THROUGH
(Thousand dol l
192.10 192.10
(162.50)
3 1.25
30.45
20.81%
(162.50)
(3.77)
25.43
15.19%
.01486
.01472
(.00014)
CASE
ars)
192.10
(162.50)
(23.53)
5.67
2.47%
.01486
.01547
.00061
192.10
(162.50)
(8.76)
20.44
10.64%
.01486
.01499
.00013
192.10
(162.50)
(31.98)
(2.38)
__
.01486
.01565
.00079
192.10
(162.50)
(25.45)
3.75
1.80%
 %  Increase/(Decrease) over
   Pre Control  Case
1
1.3%
26.0%
88.0%
(48.2%)
^Gasoline Throughput - 20,000 gallons/day
^Target Tariff = $.01754/gallon
 Includes principle and interest payments for vapor control  equipment
                                            G.ll
(91.2%)

-------
                                        TABLE G.5 (continued)
                     VAPOR CONTROL COSTS (NOJC) AT LARGE BULK PLANTS
(Thousands dol
lars)



FULL PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING
BACK-UP SYSTEM
Capital Recovery Requirement
Pre Control
2
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control
Operating Expenses
Gasoline Tariff- Post
Control
% Increase/(0ecrease) over
Pre Control Case
1
BALANCE
Incoming
TT Only
TOP
NO
29.40
1.01
30.41

162.50
(2.35)
160.15
.01754
.00014
(.00032)
.01736
(1.0%)
3
BALANCE
Incoming
& Outgoing
Trucks
TOP
NO
29.40
6.14
35.54

162.50
(2.88)
159.62 '
.01754
.00084
(.00039)
.01799
2.6%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
29.40
22.63
52.03

162.50
(1.00)
161.50
.01754
.00310
(.00014)
.02050
16.9%
4
INCIN-
ERATION
TOP
NO
29.40
12.16
41.56

162.50
4.42
166.92
.01754
.00167
.00061
.01982
13.0%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
29.40
28.65
58.05

162.50
0.92
163.42
.01754
.00392
.00013
.02159
23.1%
4
INCIN-
ERATION
TOP
YES
29.40
18.19
47.59

162.50
5.74
168.24
.01754
.00249
.00079
.02082
18.7%
'20% BFIT, 20 years
?20% BFIT, 10 years
                                          G.T2

-------
                                       TABLE G.6
VAPOR CONTROL COSTS (HOUSTON-GALVESTON) AT LARGE BULK PLANTS1
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING-
BACK-UP SYSTEM
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Control
Vapor Control Operating
Expenses
Utilities
Labor
M & R
Mis., Taxes, Ins., G &
Recovery Credit
Net Expenses
Unit Operating Expenses ($/(
- Gasoline Only
Pre Control
Post Control
Increase/(Decrease)
ROI Impact
	 c 	 2
Bulk Plant Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income-PoVst Control
DflT
(Thousand dollars)
1 3 4
REFRIG-
BALANCE BALANCE ERATION
Incoming Incoming VAPOR
TT Only & Outgo- CONTROL
inq Trucks
TOP
NO
143.00
4.25
147.25
0.07
A 0.17
(2.59)
(2.35)
3al)
.01486
.01454
(.00032)
NO PASS
TOP
NO
143.00
12.98
155.98
0.39
0.52
(4.08)
(3.17)
.01486
.01440
(.00046)
THROUGH
(Thousand do 1 1
192.10 192.10
(162.50) (162.50)
3 1.25 0.01
30.45
20.81%
29.21
18.85%
TOP
NO
143.00
82.13
225.13
2.17
1.43
2.98
3.29
(11.11)
(1.24)
.01486
.01469
(.00017)
CASE
ars)
192.10
(162.50)
(19.99)
9.21
4.18%
4
INCIN-
ERATION
TOP
NO
143.00
38.24
181.24
0.16
1.43
1.01
1.53
4.13
.01486
.01543
.00057
192.10
(162.50)
(14.02)
15.18
8.49%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
143.00
107.37
250.37
2.17
1.43
3.29
4.29
(10.55)
0.63
.01486
.01495
.00009
192.10
(162.50)
(28.39)
.81
0.4%
4
INCIN-
ERATION
TOP
YES
143.00
63.50
206.50
0.16
1.43
1.32
2.54
5.45
.01486
.01561
.00075
192.10
(162.50)
(21.87)
7.33
3.56%
% Increase/(Decrease) over
  Pre Control Case
1.3%
(8.20%)    (79.7%)      (58.7%)    (98.0%)    (82.2%)
^Gasoline Throughput - 20,000 gallons/day
^Target Tariff = $.017547galIon                                .
Includes principle and interest payments for vapor control  equipment
                                           G.13

-------
                                       TABLE G.6  (continued)
              VAPOR CONTROL COSTS (HOUSTON-GALVESTON) AT LARGE  BULK  PLANTS
(Thousand dollars)
FULL PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING
BACK-UP SYSTEM
Capital Recovery Requirement
Pre Control
Vapor Control2
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control
Operating Expenses
Gasoline Tariff-Post
Control
1
BALANCE
Incoming
TT Only
TOP
NO

29.40
1.01
29.41

162.50
(2.35)
160.15
.01754
.00014
(.00032)
.01736
3
BALANCE
Incoming
& Outgoing
Trucks
TOP
NO

29.40
3.10
31.50

162.50
(3.17)
158.93
.01754
.00042
(.00046)
.01750
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO

29.40
19.59
47.99

162.50
(1.24)
161.26
.01754
.00268
(.00017)
.02005
4
INCIN-
ERATION
TOP
NO

29.40
9.12
37.52

162.50
4.13
166.63
.01754
.00125
.00057
.01936
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES

29.40
25.61
54.01

162.50
0.63
163.13
.01754
.00351
.00009
.02114
4
INCIN-
ERATION
TOP
YES

29.40
15.14
43.54

162.50
5.45
167.95
.01754
.00207
.00075
.02036
% Increase/(Decrease)  over
  Pre Control  Case            (1.0%)
(0.2%)    14.3%
10.4%     20.5%
1
 20% BFIT,  20 years
     BFIT,  10 years
1 6.1".',
                                         G.14

-------
                                        TABLE 6.7
VAPOR CONTROL COSTS
(COLORADO APCD) AT LARGE BULK PLANTS1
(Thousand dollars)
OPTION
TYPE PRIMARY
SYSTEM



TYPE LOADING '
BACK-UP SYSTEM
Current Investment
Added Vapor Control
Investment
Total In vestment- Post
Control
Vapor Control Operating
Expenses
Utilities
Labor
M & R
1

BALANCE
Incoming
TT Only

TOP
NO
143.00

1.70

144.70


—
—
0.05
Mis., Taxes, Ins., G & A 0.07
Bornvpw CrpHl t"
Net Expenses
(2.59)
(2.47)
3 4
REFRIG-
BALANCE ERATION
Incoming VAPOR
& Outgo- CONTROL
inq Trucks
TOP TOP
NO NO
143.00 143.00

4.88 74.03

147.88 217.03


2.17
1.43
0.15 2.74
0.20 2.96
(4.08) (11.11)
(3.73) (1.81)
4 4
INCIN- REFRIG-
ERATION ERATION
VAPOR
CONTROL

TOP TOP
NO YES
143.00 143.00

30.14 99.27

173.14 242.27


0.16 2.17
1.43 1.43
0.77 3.05
1.21 3.97
(10.55)
3.57 0.07
4
INCIN-
ERATION



TOP
YES
143.00

55.40

198.40


0.16
1.43
1.08
2.22
—
4.89
Unit Operating Expenses ($/Gal)
- Gasoline Only
Pre Control
Post Control
Increase/ (Decrease)

.01486
.01452
(.00034)

.01486 .01486
.01435 .01461
(.00051) (.00025)

.01486 .01486
.01535 .01487
.00049 .00001

.01486
.01553
.00067
NO PASS THROUGH CASE
(Thousand dollars)
ROI Impact
	 2
Bulk Plant Revenue
Expenses-Pre Control
Expenses-Vapor Contro
Net Income- Post Control
ROI
% Increase/ (Decrease) over
Pre Control Case

192.10
(162.50)
I3 2.03

31.23
21.72%
5.7%

192.10 192.10
(162.50) (162.50)
2.47 (17.33)

31.67 11.87
21.55% 5.56%
4.9% (72.9%)

192.10 192.10
(162.50) (162.50)
(11.36) (25.74)

17.84 3.46
10.42% 1.51%
(49.3%) (92.6%)

192.10
(162.50)
(19.21)

.99
5.14%
(75.0%)
  ltWW^^*l**l^*  w»»w •—              --
iGasoline Throughput - 20,000 gallons/day
^Target Tariff = $.01754/gallon
^Includes principle and interest payments for vapor control
                                           G.I 5
equipment

-------
                                        TABLE G.7 (continued)


                 VAPOR CONTROL COSTS (COLORADO APCD) AT LARGE BULK PLANTS
(Thousand dollars)
FULL PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING
BACK-UP SYSTEM
Capital Recovery Requirement
Pre Control ^
Vapor Control2
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control
Operating Expenses
Gasoline Tariff-Post
Control
1
BALANCE
Incoming
TT Only
TOP
NO
29.40
0.41
29.81
162.50
(2.47)
164.97
.01754
.00006
(.00034)
.01726
3
BALANCE
Incoming
& Outgoing
Trucks
TOP
NO
29.40
1.16
30.56
162.50
(3.73)
166.23
,01 754
.00016
(.00051)
.01719
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
29.40
17.66
47.06
162.50
(1.81)
164.31
.01754
. 00242
(.00025)
.01971
4
INCIN-
ERATION
TOP
NO
29.40
7.19
36.59
162. 50'
3.57
166.07
.01754
.00098
.00049
.01901
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
29.40
23.68
53.08
1 62 . 50
0.07
162.57
.01754
.00324
.00001
.02079
4
INCIN-
ERATION
TOP
YES
29.40
13.21
42.61
162.50
4.89
167.39
.01754
.00181
.00067
.02002
% Increase/(Decrease) over
  Pre .Control  Case             (1.6%)
(2.0%)    12.4%
8.4%
18.5%
1
 20% BFIT, 20 years

 ?10% BFIT, 10 years
14.1%
                                          G.16

-------
                                         TABLE  G.8
VAPOR
CONTROL COSTS (NOJC)
AT SMALL BUL
K PLANTS1


I Thousand dollars)
OPTION
TYPE PRIMARY
SYSTEM


1
BALANCE
Incoming
TT Only
3
BALANCE
Incoming
& Outgo-
4
REFRIG-
ERATION
VAPOR
CONTROL
4
INCIN-
ERATION


ing Trucks
TYPE LOADING .
BACK-UP SYSTEM
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Control
Vapor Control Operating
Expenses
Utilities
Labor
M & R
Mis. , Taxes, Ins. , G &
Recovery Credit
Net Expenses
TOP
NO
57.00

4.25

61.25


--
--
0.07
A 0.17
(0.51)
(0.27)
TOP
NO
57.00

23.03

80.03


--
--
0.07
0.92
(0.81)
0.18
TOP
NO
57.00

92.18

149.18


2.17
1.43
2.75
3.69
(2.19)
7.85
TOP
NO
57.00

48.32

105.32


0.16
1.43
0.78
1.93
__
4.30
4
REFRIG-
ERATION
VAPOR
CONTROL

TOP
YES
57.00

117.42

174.42


2.17
1.43
3.06
4.70
(2.08)
9.28
4
INCIN-
ERATION



TOP
YES
57.00

73.55

130.55


0.16
1.43
1.09
2.94
_ —
5.62
Unit Operating Expenses ($/Gal)
- Gasoline Only
Pre Control
Post Control
Increase/(Decrease)


.02670
.02652
(.00018)
NO PASS

.02670
.02682
.00012
THROUGH
(Thousand doll
ROI Impact
2
Bulk Plant Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income- Post Control
ROI /ROE


66.70
(54.90)
(0.83)
10.77
17.75%


66.70
(54.90)
(6.13)
5.47
6.96%

.02670
.03208
.00538
CASE
ars)


66.70
(54.90)
(31.68)
(19.88)
___

.02670
.02965
.00295




66.70
(54.90)
(16.79)
(4.99)
___

.02670
.03306
.00636




66.70
(54.90)
(39.64)
(27.84)
___

.02670
.03055
.00385




66.70
(54.90)
(24.64)
(12.84)
___
% Increase/(Decrease) over
  Pre Control  Case            (13.6%)      (66.1%)

?Gasoline Throughput - 4,000 gallons/day
^Target Tariff = $.03238/gallon
 Includes principle and interest payments for vapor control  equipment
                                          6.17

-------
                                        TABLE  6.8 (continued)

                     VAPOR CONTROL  COSTS (NOJC)  AT SMALL BULK PLANTS
(Thousand dollars)
FULL PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING
BACK-UP SYSTEM
Capital Recovery Requirement
Pre Control
2
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control
Operating Expenses
Gasoline Tariff-Post
Control
1
BALANCE
Incoming
TT Only
TOP
NO
11.70
1.01
12.71

54.90
(0.27)
54.63
.03238
.00069
(.00018)
.03289
3
BALANCE
Incoming
& Outgoing
TrucRs
TOP
NO
11.70
5.49
17.19

54.90
0.18
55.08
*•
.03238
.00376
.00012
.03626
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
11.70
21.98
33.68

54.90
7.85
62.75
.03238
.01505
.00538
.05281
4
INCIN-
ERATION
TOP
NO
11.70
11.52
23.22

54.90
4.30
59.20
.03238
.00789
.00295
.04322
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
11.70
28.00
39.70

54.90
9.28
64.18
.03238
.01918
.00636
.05792
4
INCIN-
ERATION
TOP
YES
11 .70
17.54
29.24

54.90
5.62
60.52
.03238
.01201
.00385
.04824
% Increase/(Decrease) over
  Pre Control Case
1
1.6*
12.0%
63.1%
33.5%
78.9%
 20* BFIT, 20 years

210% BFIT, 10 years
49.0%
                                         G.18

-------
                                        TABLE G.8 (continued)

                     VAPOR CONTROL COSTS (NOJC) AT SMALL BULK PLANTS
(Thousand dollars)
COMPETITIVE PASS THROUGH CASE
OPTION
TYPE PRIMARY -
SYSTEM

TYPE LOADING
BACK-UP SYSTEM
Gasoline Tariff ($/Gal)
Pre Control
Capital Recovery-Most
Efficient Unit
Operating Expense-Most
Efficient Unit
Gasoline Tariff-Post
Control
? Increase/ (Decrease) over
?re Control Case
ROI Impact
Bulk Plant Revenue
Expenses-Pre Control
o
Expenses-Vapor Control
Net Income-Post Control
1
BALANCE
Incoming
TT Only
TOP
NO
.03238
.00014
(.00032)
.03220
(0.6%)
66.44
(54.90)
(0.83)
10.51
3
BALANCE
Incoming
& Outgo-
ing Trucks
TOP
NO
.03238
.00084
(.00039)
..03283
1.4%
67.36
(54.90)
(6.13)
6.13
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
.03238
.00310
(.00014)
.03534
9.1%
71.02
(54.90)
(31.68)
(15.56)
4
INCIN-
ERATION

TOP
NO
.03238
.00167
.00061
.03466
7.0%
70.03
(54.90)
(16.79)
(1.66)
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
.03238
.00392
.00013
.03643
12.5%
72.62
(54.90)
(39.64)
(21.92)
4
INCIN-
ERATION

TOP
YES
.03238
.00249
.00079
.03566
10.1%
71.49
(54.90)
(24.64)
(8.05)
ROI/ROE
17.32%
7.78%
  lncrease/(Decrease)  over
  ^re Control  Case            (15.7%)     (62.1%)
1
 Based on above gasoline tariffs
2Includes principle and interest payments for vapor control equipment
                                           G.19

-------
                                        TABLE G.9
VAPOR CONTROL COSTS (HOUSTON -GAL VESTON) AT SMALL BULK PLANTS1
(Thousand doll
OPTION
TYPE PRIMARY
SYSTEM

TYPE LOADING
BACK-UP SYSTEM
Current Investment
Added Vapor Control
Investment
Total Investment-Post
Control
Vapor Control Operating
Expenses
Utilities
Labor
M & R
Mis., Taxes. Ins., G &
Recovery Credit
Net Expenses
1
BALANCE
Incoming
TT Only
TOP
NO
57.00
4.25
61.25

--
0.07
A 0.17
(0.51)
(0.27)
3
BALANCE
Incoming
& Outgo-
ing Trucks
TOP
NO
57.00
10.70
67.70

--
0.32
0.43
(0.81)
(0.06)
lars)
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
57.00
79.85
136.85
2.17
1.43
2.91
3.19
(2.19)
7.51

4
INCIN-
ERATION

TOP
NO
57.00
35.96
92.96
0.16
1.43
0.94
1.44
3.97

4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
57.00
105.09
162.09
2.17
1.43
3.22
4.20
(2.08)
8.94

4
INCIN-
ERATION

TOP
YES
57.00
61.22
118.22
0.16
1.43
1.25
2.45
5.29
Unit Operating Expenses ($/Gal)
- Gasoline Only
Pre Control
Post Control
Increase/ (Decrease)
.02670
.02652
(.00018)
.02670
.02666
(.00004)
.02670
.03184
.00514
.02670
.02942
.00272
.02670
.03282
.00612
.02670
.03032
.00362
NO PASS THROUGH CASE
(Thousand dollars)
ROI Impact
Bulk Plant Revenue
Expenses-Pre Control
Expenses-Vapor ControV
Net Income-Post Control
ROI
66.70
(54.90)
(0.83)
10.77
17.75%
66.70
(54.90)
(2.71)
8.89
13.28%
66.70
(54.90)
(28.15)
(16.35)
___
66.70
(54.90)
(13.27)
(1.47)
___
66.70
(54.90)
(36.11)
(24.31)
_ —
66.70
(54.90)
(21.12)
(9.32)
—
% Increase/(Decrease) over
  Pre Control Case
1
(13.6%)     (35.3%)
^Gasoline'Throughput - 4,000 gallons/day
^Target Tariff = $.03238/gallon
 Includes principle and interest payments for vapor control equipment
                                           G.20

-------
TABLE G.9 (continued)
VAPOR CONTROL
COSTS (HOUSTON-GALVESTON) AT SMALL BULK PLANTS
(Thousand dollars)
FULL PASS THROUGH CASE
OPTION
TYPE PRIMARY •
SYSTEM

TYPE LOADING
BACK-UP SYSTEM
Capital Recovery Requirement
Pre Control
2
Vapor Control
Total Capital Recovery
Operating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control
Operating Expenses
Gasoline Tariff-Post
Control
% Increase/ (Decrease) over
1

BALANCE
Incoming
TT Only
TOP
NO

11.70
1.01
12.71

54.90
(0.27)
54.63

.03238
.00069
(.00018)
.03289
1 .6%
3

BALANCE
Incoming
& Outgoing
Truclcs
TOP
NO

11.70
2.55
14.25

54.90
(0.06)
54.84

.03238
.00175
(.00004)
.03409
5.3%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO

11.70
19.04
30.74

54.90
7.51
62.41

.03238
.01304
.00514
.05056
56.1%
4
INCIN-
ERATION

TOP
NO

11.70
8.58
20.28

54.90
3.97
58.87

.03238
.00588
.00272
.04098
26.6%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES

11.70
25.06
36.76

54.90
8.94
63.84

.03238
.01716
.00612
.05566
71.9%
4
INCIN-
ERATION

TOP
YES

11.70
14.60
26.30

54.90
5.29
60.19

.03238
.01000
.00362
.04600
42.1%
1
 20% BFIT, 20 years
 10% BFIT, 10 years
                                       G.21

-------
                                         TABLE G.9 (continued)

                VAPOR CONTROL COSTS (HOUSTON-GALVESTON)  AT SMALL BULK PLANTS
(Thousand dollars)
COMPETITIVE PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM

TYPE LOADING
BACK-UP SYSTEM
Gasoline Tariff ($/Gal )
Pre Control
Capital Recovery-Most
Efficient Unit
Operating Expense-Most
Efficient Unit
Gasoline Tariff-Post
Control
% Increase/ (Decrease) over
Pre Control Case
ROI Impact
Bulk Plant Revenue
Expenses-Pre Control
2
Expenses- Vapor Control
Net Income- Post Control
1
BALANCE
Incoming
TT Only
TOP
NO
.03238
.00014
(.00032)
.03220
(0.6%)
66.44
(54.90)
(0.83)
10.51
3
BALANCE
Incoming
& Outgo-
ing Trucks
TOP
NO
.03238
.00042
(.00046)
.03234
(0.1%)
66.44
(54.90)
(2.71)
8.83
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
.03238
.00268
(.00017)
.03489
7.8%
66.44
(54.90)
(28.15)
(12.68)
4
INCIN-
ERATION

TOP
NO
.03238
.00125
.00057
.03420
5.6%
66.44
(54.90)
(13.27)
.99
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
.03238
.00351
.00009
.03598
11.1%
66.44
(54.90)
(36.11)
(19.05)
4
INCIN-
ERATION

TOP
YES
.03238
.00207
.00075
.03520
8.7%
66.44
(54.90)
(21 .12)
(5.20)
 ROI
17.32%
13.19%
1.17%
 % Increase/(Decrease) over
   Pre Control Case             (15.7%)      (35.8%)
                                  (94.3%)
2 Based  on above gasoline tariffs
  Includes principle  and  interest  payments  for vapor control  equipment
                                           G.22

-------
TABLE G.10
VAPOR CONTROL COSTS (COLORADO APCD) AT SMAL
1 BULK PLANTS1
(Thousand dollars)
C-VrfW
TT-f; PRIMARY
SYSTEM



TYPE LOADING-
BACK-UP SYSTEM
Current Investment
A;!ded Vapor Control
Investment
Total Investment-Post
Control
V :r Control Operating
xpenses
Utilities
Labor
M & R
Mis. , Taxes, Ins. , G &
Recovery Credit
Mat Expenses
1
BALANCE
Incoming
TT Only

TOP
NO
57.00

1.70

58.70


--
--
0.05
A 0.07
(0.51)
(0.39)
3
BALANCE
Incoming
& Outgo-
ing Trucks
TOP
NO
57.00

3.84

60.84


--
—
0.12
0.15
(0.81)
(0.54)
4
REFRIG-
ERATION
VAPOR
CONTROL

TOP
NO
57.00

72.99

129.99


2.17
1.43
2.71
2.92
(2.19)
7.04
4
INCIN-
ERATION



TOP
NO
57.00

29.10

86.10


0.16
1.43
0.74
1.16
__
3.49
4
REFRIG-
ERATION
VAPOR
CONTROL

TOP
YES
57.00

98.23

155.23


2.17
1.43
3.02
3.93
(2.08)
8.47
4
"- - — •••' i i .-
INCIN-
ERATION



TOP
YES
57.00

54.36

109.36


0.16
1.43
3.05
2.17
_ _
4.81
I;:PC Operating Expenses ($/Gal )
- Gasoline Only
Pre Control
Post Control
Increase/ (Decrease)


.02670
.02643
(.00027)
NO PASS

.02670
.02633
(.00037)

.02670
.03152
.00482

.02670
.02909
.00239

.02670
.03250
.00580

.02670
.02999
.00329
THROUGH CASE
(Thousand dollars)
ROI Impact
2
Bulk Plant Revenue
Expenses-Pre Control
Expenses-Vapor Control
Net Income-Post Control
R9I

66.70
(54.90)
3 (0.05)
11.55
19.85%

66.70
(54.90)
(0.45)
11.15
18.49%

66.70
(54.90)
(25.91)
(14.11)
	

66.70
(54.90)
(11.01)
0.59
0.8%

66.70
(54.90)
(33.87)
(22.07)
	

66.70
(54.90)
(18.86)
(7.06)
—
Increase/(Decrease) over
Pre Control  Case
                       (96.1%)
                              (3.4%)     (10.0%)

^Gasoline Throughput - 4,000 gallons/day
^Target Tariff = $.03238/gallon
 Includes principle and interest payments for vapor control  equipment
  G.23

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                                       TABLE G.10 (continued)
                VAPOR CONTROL COSTS (COLORADO APCD) AT SMALL BULK PLANTS
(Thousand dollars)
FULL PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING
BACK-UP SYSTEM
Capital Recovery Requirement
Pre Control
2
Vapor Control
Total Capital Recovery
Ope rating Expenses
Pre Control
Vapor Control
Total Expenses-Post Control
Gasoline Tariff ($/Gal)
Pre Control
Vapor Control Capital
Recovery
Vapor Control
Operating Expenses
Gasoline Tariff- Post
Control
* Increase/ (Decrease) over
Pre Control Case
1
BALANCE
Incoming
TT Only
TOP
NO
11.70
0.41
12.11

54.90
(0.39)
54.51
.03238
.00028
(.00027)
.03239
0.0%
3
BALANCE
Incoming
& Outgoing
Trucks
TOP
NO
11.70
0.92
12.62

54.90
(0.54)
54.36
.03238
.00063
(.00037)
.03264
0.8%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
11.70
17.41
29.11

54.90
7.04
61.94
.03238
.01192
.00482
.04912
51.7%
4
INCIN-
ERATION
TOP
NO
11.70
6.94
18.64

54.90
3.49
58.39
.03238
.00475
.00239
.03952
22.1%
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
11.70
23.43
35.13

54.90
8.47
63.37
.03238
.01605
.00580
.04523
67.5%
4
INCIN-
ERATION
TOP
YES
11.70
12.96
24.66

54.90
4.81
59.71
.03238
. 00888
.00329
.04455
37.6%
1
 20* BFIT,  20 years
-20% BFIT,  10 years
                                          G.24

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                                       TABLE  G.10  (continued)
                VAPOR CONTROL COSTS (COLORADO APCD)  AT  SMALL  BULK  PLANTS
(Thousand dollars)
COMPETITIVE PASS THROUGH CASE
OPTION
TYPE PRIMARY
SYSTEM
TYPE LOADING
BACK-UP SYSTEM
Gasoline Tariff ($/Gal )
Pre Control
Capital Recovery-Most
Efficient Unit
Operating Expense-Most
Efficient Unit
1
BALANCE
Incoming
TT Only
TOP
NO
.03238
.00006
(.00034)
3
BALANCE
Incoming
& Outgo-
ing Trucks
TOP
NO
.03238
.00016
(.00051)
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
NO
.03238
.00242
(.00025)
4
INCIN-
ERATION
TOP
NO
.03238
.00501
.00049
4
REFRIG-
ERATION
VAPOR
CONTROL
TOP
YES
.03238
.00324
.00001
4
INCIN-
ERATION
TOP
YES
.03238
.00181
.00067
Gasoline  Tariff-Post
  Control
                              .03210
.03203    .03455
.03788    .03563      .03486
:v, Increase/(Decrease)  over
  Pre  Control  Case              (0.9%)      (1.1%)
                                                      6.7%
                       17.0%
           10.0%
7.7%
                      .1
RQI  Impact
     Bulk Plant  Revenue
     Expenses-Pre  Control
     Expenses-Vapor Control
Net Income-Post  Control

ROI
66.29
(54.90)
(0.05)
11.14
66.19
(54.90)
(0.45)
10.64
69.87
(54.90)
(25.91)
(10.94)
74.73
(54.90)
(11.01)
8.62
71.45
(54.90)
(33.87)
(17.32)
70.32
(54.90)
(18.86)
(3.44)
                               19.15%
17.65%
                                                                  10.13
I Increase/(Decrease) over
  Pre Control Case             (6.8%)
                                                                 (50.7%)
 1
0Based on above gasoline tariffs                      nn+M-\  onm
2 Includes  principle  and interest payments  for vapor control  equi
                                           G.25

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                                   TECHNICAL REPORT DATA
                           (Please read Iiianicrions on the reverse before completing)
1 REPORT NO.
  EPA 450/5-80-001
                                                           3. RECIPIENT'S ACCESSIO.VNO.
4. TITLE AND SUBTITLE
                                                           5. REPORT DATE
  The Economic  Impact  of Vapor Control Regulations
  on the Bulk Storage  Industry
                                                           Final Report June  1979
                                                         6. PERFORMING ORGANIZATION CODE
7. AUTHOR(S)

  Richard J. McCarthy
                                                           8. PERFORMING ORGANIZATION REPORT NO.
9. PERFORMING ORGANIZATION NAME AND ADDRESS
                                                           10. PROGRAM ELEMENT NO.
Arthur D. Little, Inc.
37 Acorn Park
Cambridge, Massachusetts
                                                           11. CONTRACT/GRANT NO.
                             02140
 12. SPONSORING AGENCY NAME AND ADDRESS
   Environmental  Protection Agency
   Office of Air  Quality Planning and  Standards
   Research Triangle Park, NC 27711
                                                         13. TYPE OF REPORT AND PERIOD COVERED

                                                            Final	
                                                         14. SPONSORING AGENCY CODE
IS. SUPPLEMENTARY NOTES
 16. ABSTRACT           •
        This report assesses economic impacts of several  vapor control strategies
   which would reduce the benzene  emissions of the bulk storage industry.  The
   report seeks to:
        o  Identify and characterize the bulk storage  industry
        o  Determine the number  of facility closures expected to occur
           because of the proposed vapor control regulations
        o  Estimate the employment levels displaced by these closures, and
        o  Calculate the national  cost of installing and  operating vapor control
           systems in the remaining bulk storage population.

        The U.S. Environmental  Protection Agency  (EPA) has analyzed alternative
   regulations which would  control total benzene emissions on a national basis.
   A significant portion of these  benzene emissions  is contained in the gasoline
   vapors released during the  normal gasoline transfer operations of  petroleum bulk
   terminals and bulk plants.   Possible strategies for controlling benzene  in the
   bulk storage industry include the on-site collection  and disposal  of gasoline
   vapors and the collection and transportation  of these vapors to a  common  or
   central point within the gasoline marketing network for ultimate disposal.
 17.
                                KEY WORDS AND DOCUMENT ANALYSIS
                  DESCRIPTORS
1 Benzene Emissions
 Gasoline Bulk Terminals
; Gasoline Bulk Plants
j Marine Terminals
* Service Stations
1 Vapor Recovery  Systems
j Gasoline Marketing
                        Socio-Economic Fac
                        National VOC Emiss
                        Economic Impacts
                        Tank  Trailer Vehic
                                            b.lDENTIFIERS/OPEN ENDED TERMS
ors  Vapor Control
ons  Regulations, bulk
     Gasoline  Storage/
es    Marketing Network
                                                                            COSAPi Held/Croup
 I'i. DISTRIBUTION STATEMENT
j  Available  from NTIS
]  Release  Unlimited
                                            19. SECURITY CLASS (This Report)
                                              Unclassified
                                                                          21. NO. OF PAGtS
                                                                                 256
                                            20. SECURITY CLASS (This page}

                                              Unclassified
                                                                       22. PRICE
-J'A Form 22ZO-1 J9-73)

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