COST IMPACT ANALYSIS FOR
PROPOSED CHANGES IN THE
DEFINITION OF SOLID WASTE AND
MANAGEMENT STANDARDS FOR WASTES
THAT ARE USED, REUSED, RECYCLED
OR RECLAIMED
Prepared for
OFFICE OF SOLID WASTE
ENVIRONMENTAL PROTECTION AGENCY
401 M STREET, S.W.
WASHINGTON, DC 20460
Prepared by
INDUSTRIAL ECONOMICS, INC.
30 BOYLSTON STREET
CAMBRIDGE, MA 02138
March 1983
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TABLE OF CONTENTS
CHAPTER I
INTRODUCTION 1-1
CHAPTER II
DESCRIPTION OF AFFECTED ESTABLISHMENTS II-l
Number of Affected Establishments II-l
Characteristics of Affected Establishments ..11-4
CHAPTER III
ONIT COSTS OF CHANGES IN REGULATORY REQUIREMENTS III-l
Sources of Cost Estimates III-l
Unit Cost Estimates III-2
A. Generator Requirements III-3
B. Storage Facility Requirements: General. III-4
C. Storage Facility Requirements: Containers III-5
D. Storage Facility Requirements: Tanks. ^. . .-^^^•-111-6.
E. Storage Facility Requirements: Waste Piles II1-6
F. "Short Storage" Requirements 111-7
G. "Permit-By-Rule" Requirements III-7
CHAPTER IV
COST IMPACT OF PROPOSED CHANGES IN THE DEFINTION
OF SOLID WASTE AND MANAGEMENT STANDARDS FOR WASTES
THAT ARE RECYCLED IV-1
CHAPTER V
IMPACTS ON INDUSTRIES SUBJECT TO INCREASED
REQUIREMENTS V-l
Paint and Allied Product Producers V-l
Solvent Reclaimers V-2
Battery Crackers V-2
APPENDIX A
PROPOSED DEFINITION OF SOLID WASTE AND
MANAGEMENT STANDARDS FOR WASTES THAT
ARE RECYCLED ....A-l
i
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TABLE OF CONTENTS (continued)
APPENDIX B
ADJUSTMENTS TO ESTIMATES OF NUMBER OF
AFFECTED ESTABLISHMENTS B-l
APPENDIX C
ADJUSTMENTS TO UNIT COSTS C-l
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LIST OP EXHIBITS
II-l List of Currently-Practiced Activities Significantly
Affected by the Proposed Changes
II-2 Establishments Affected by the Proposed Changes in the
in the Definition of Solid Waste and Management
Standards for Wastes That are Recycled
II-3 Characteristics of Affected Establishments
III-1 Unit Costs for Generator Requirements
III-2 Unit Costs for Storage Facilities: General
Requirements
III-3 Unit Costs for Storage Facilities: Containers
III-4 Unit Costs for Storage Facilities: Tanks
III-5 Unit Costs for Storage Facilities: Waste Piles
III-6 Unit Costs for "Permit-By-Rule" Requirements
IV-1 Summary of Changes in Compliance Costs Due to
Proposed Changes: "Best Estimate"
IV-2 Changes in Compliance Costs Due to Proposed
Changes by Industry: "Best Estimate'
IV-3 Adjustments for Secondary Lead Smelters Affected
by Changed Requirements for More Than One Activity
IV-4 Summary of Changes in Compliance Costs Due to
Proposed Changes: "Worst Case"
C-l Inflation Indices
C-2 Unit Cost Categories Applied for Different Changes
in Regulatory Requirements
C-3 Capacity Conversion Factors for Tanks and Containers
iii
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fflTRPPPCTMB
CHAPTER 1
The Environmental Protection Agency is proposing to amend
the definition of solid waste and management standards for wastes
that are used, reused, or reclaimed!/ under the Resource Conser-
vation and Recovery Act (RCRA), in order to target the hazardous
waste regulations more directly at those recycling operations
that have the potential to pose a substantial hazard to human
health or the environment. The proposed changes will reduce
regulatory requirements under RCRA for establishments engaged in
a number of recycling activities and will increase requirements
for those engaged in other such activities. The purpose of this
report is to assess the impact of the proposed changes on com-
pliance costs for the directly-affected establishments.
This analysis was undertaken to comply with the requirements
of Executive Order 12291. That order requires that the Agency
prepare a Regulatory Impact Analysis which assesses the costs and
benefits of proposed regulations for any major regulation or
regulatory change. A "major rule" is one that is likely to
result in:
i/These various types of activities are referred to generally as
"recycling" throughout this report.
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• an annual effect on the economy of $100 million or
more;
• a major increase in costs or prices for consumers,
individual industries, federal, state or local
government agencies, or geographic regions;
• significant adverse effects on competition,
employment, investment, productivity, innovation,
or the ability of United States-based enterprises
to compete with foreign-based enterprises in
domestic or export markets.
The analysis described in this report assesses whether the pro-
posed changes constitute a "major rule" as defined above, and
hence whether a complete Regulatory Impact Analysis is required
by Executive Order 12291. In order to determine the likelihood
of major increases in costs or prices or of significant adverse
effects on competition, employment, and other economic factors,
changes in costs of compliance for the directly-affected
establishments are calculated. This analysis of costs is based
on "worst case" assumptions about the number and characteristics
of the affected establishments and the unit costs of the affected
regulatory activities, and therefore overstates cost increases
and understates savings. If no industry experiences significant
increases in cost as a result of the proposed changes based on
this "worst case" analysis, then it is unlikely that any of the
criteria for a major rule will apply.
The results of this analysis show that the proposed changes
result in a net savings in compliance costs to the regulated
community of $24.4 million. Three industries could experience
moderate increases in costs, but significant adverse effects on
competition, employment, or other economic factors are not
expected to result jErom these cost increases. Therefore, the
proposed changes in the definition of solid waste and management
standards do not constitute a major rule as defined in Executive
Order 12291.
The remainder of this report is organized as follows:
• Chapter II briefly describes the changes being
proposed and characterizes the establishments
affected by the changes.
• Chapter III describes the regulatory requirements
affected by the proposed changes and calculates
unit compliance costs for each activity.
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• Chapter IV calculates the aggregate cost impacts
of the proposed changes, based on information on
the affected establishments and unit costs by
activity developed in the previous two chapters.
• Chapter V discusses the effects of the proposed
changes on those industries which will experience
increased requirements.
• Appendix A provides a copy of the proposed def-
inition of solid waste.
• Appendix B describes adjustments made by IEc to
estimates developed by other contractors of the
number of establishments affected by the proposed
changes.
• Appendix C describes the adjustments made to the
unit costs presented in Chapter III.
Exhibits referred to in each chapter are located at the end of
the chapter.
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DESCRIPTION OF AFFECTED ESTABLISHMENTS
CHAPTER 2
This chapter identifies the number of establishments by
industry that will be affected by the proposed changes in the
definition of solid waste and management standards for wastes
that are recycled, and also characterizes those establishments by
types of storage used and by the volumes of affected wastes.
NUMBER OF AFFECTED
ESTABLISHMENTS
A report prepared for the Agency by JRB Associates.]/, (1)
identifies the activities affected by the combination of the
proposed changes in the definition of solid waste and certain
exemptions, and (2) estimates the number of establishments
practicing these activities.
A total of 102 types of recycling activities were identified
by JRB as potentially affected, including on-site and off-site
use, reuse, and reclamation of listed and non-listed spent mater-
ials, sludges, and by-products. Of the 102 potentially-affected
activities, JRB determined that 44 activities would not be affec-
ted by the proposed changes and 58 activities would be subject to
either reduced or increased regulatory requirements. From these
1/JRB Associates, Impact £11 the Regulated Community OL Possible
Chances in iii£ Definition of. Solid Waste; Use. Reuse. Recyclingr
Reclamation. February 1983.
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58 activities, 15 were selected for further study, 12 of which
were identified as currently being practiced by industry. These
12 activities were selected for further study since they are
likely to account for the vast majority of impacts resulting from
the regulatory change. (See the report prepared by JRB
Associates for details on the selection of specific activities.)
JRB then estimated the number of establishments engaged in
these 12 activities by industry. Their review identified 39
industry categories which are involved in recycling that may be
affected significantly. Of this total, estimates of the number
of affected establishments were made in 28 industrial categories.
(The number of affected establishments could not be quantified
for the other 11 industry categories. However, a qualitative
analysis of changes in requirements for these 11 industry cate-
gories is presented in the JRB report. See JRB report pp. 4-9 to
4-14 for this analysis). This report considers cost impacts only
for those industry categories where the number of affected
establishments was estimated by JRB. For two of the 12 activi-
ties studied, JRB determined that no establishments would be
subject to changes in regulatory requirements. Therefore, IEc
calculated cost impacts for ten activities (listed in Exhibit
II-l).
The effect of some of the proposed changes is to exempt from
the hazardous waste regulations certain materials destined for
recycling which are now regulated under the hazardous waste
management regulations. In other cases, materials not now
covered under the hazardous waste management regulations will be
regulated under the proposed changes. The proposed changes in-
clude the following:
• Establishments practicing on-site reclamation or
using/reusing listed spent materials and by-
products 1 and all sludges (except when used/reused
in a manner constituting disposal or burned to
recover energy or to produce fuel), will either be
subject to reduced regulatory requirements or will
be released from control under the hazardous waste
management regulations entirely.
• Off-site reclaimers of non-listed spent materials
and by-products, as well as generators sending
non-listed spent materials and by-products to
those reclaimers, will be subject to increased
regulatory requirements or will be newly regulated
under the hazardous waste management regulations.
• Off-site use and reuse of listed spent materials
and by-products and of all sludges (with the ex-
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ceptions noted earlier) will also be subject to
reduced regulatory requirements or released from
the hazardous waste management regulations, both
for the generator of the material and for the off-
site user/reuser.
In addition to the proposed changes described above (and
considered by JRB Associates as part of their analysis), the
Agency is also proposing certain changes that were not considered
by JRB Associates in their analysis. Some of the changes provide
for exemptions from hazardous waste control, while others tailor
the standards in ways that affect the costs of compliance. IEc
has also evaluated the effects of these proposed changes in
conducting this cost analysis. The additional changes considered
in the cost analysis are:
• An exemption from hazardous waste control for
generators and off-site recyclers of wastes where
recycling is performed under a "batch-tolling"
agreement. In batch-tolling, recycled materials
are returned to the same generator who originated
the material, the generator retains title to the
materials throughout the process, the materials
are kept separate from other recycled materials in
processing, and the recycler is paid by the gen-
erator based on the amount of material returned.
• A reduction in requirements for generators and
off-site recyclers of wastes where the recycling
is performed under tolling arrangements other than
batch-tolling agreements (typically, where the
same or equivalent materials are returned to the
generator in some proportion to the amount re-
ceived from the generator, but where title is not
retained by the generator and the materials are
not segregated in processing).
A copy of the proposed definition of solid waste and of the
proposed management standards is provided in Appendix A to this
report. IEc made several adjustments to JRB's estimates of the
number of affected establishments to reflect proposed regulatory
changes not reflected in those estimates. These adjustments are
described in Appendix B.
Establishments reusing or reclaiming affected materials on-
site, or sending materials off-site for reuse/reclamation, will
be subject to increased or decreased regulatory requirements as
generators, as storage facilities or as "short storers" (40 CFR
262.34). The requirements for storage facilities are more strin-
2-3
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gent than for "short storers"—the former requirements apply to
establishments storing wastes for more than 90 days in tanks or
containers or storing in waste piles or in surface impoundments
for any length of time, while the latter apply to generators who
store hazardous wastes for less than 90 days in tanks or
containers. Under the proposed rulesf affected materials being
stored in surface impoundments will not be released from regula-
tory control. Off-site establishments which accept affected
materials for reuse/reclamation will be subject to increased or
decreased requirements as storage facilities. The affected gen-
erator, "short storage", and storage facility requirements are
described in more detail in the next chapter.
Of the establishments subject to increased requirements,
some do not now handle hazardous wastes and hence will be regu-
lated under Subtitle C of RCRA for the first time as a result of
the proposed changes. Others are already regulated under RCRA,
and will simply be subject to requirements for additional volumes
of waste. Similarly, establishments may be subject to require-
ments for smaller volumes of waste or may be released from the
hazardous waste management regulations entirely, depending on
whether or not they currently handle other hazardous wastes.
Based on information provided by the JRB report, by the
background materials cited in that report, and by OSW personnel,
IEc classified the affected establishments by industry for each
of the ten activities considered. The number of affected
establishments for each activity and industry, and the nature of
the change in requirements for each, are identified in Exhibit
II-2.
CHARACTERISTICS OP AFFECTED
ESTABLISHMENTS
In order to calculate changes in compliance costs, it was
necessary to estimate the volumes of waste affected by the pro-
posed changes and to determine what methods of storage are used
by the affected establishments. A number of sources were used to
determine the characteristics of these establishments.
Where Standard Industrial Classification (SIC) codes were
available for the relevant industries, data on waste volumes and
on storage practices were obtained from the Hazardous Waste Data
Management System (HWDMS). This data base includes information
submitted to the Agency on Notification forms and Part A permit
applications. Only the Part A applications, however, provide
data on waste volumes and on the types of storage used (contain-
ers, tanks, waste piles, or surface impoundments). Part A data
reported by establishments regulated as storage facilities in
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each industry were obtained from the HWDMS. In the absence of
more reliable information, it was assumed that the average waste
volumes per facility and the relative use of different storage
methods reported by storage facilities are typical of other
facilities in the same industry handling the same wastes.
Where the required information could not be estimated from
the HWDMS database, IEc reviewed the JRB report, the background
material cited by JRB, and other sources2/ to obtain information
on volumes of affected wastes and on storage practices for the
relevant industries. Exhibit II-3 presents the average volumes
of affected wastes and the associated storage practices estimated
by IEc for the affected establishments.
The next chapter describes the generator, "short storage"
and storage facility requirements affected by the proposed
changes and develops estimates of the changes in compliance costs
for each type of activity.
2/Arthur D. Little, Inc..Economic Impact Analysis of RCRA Interim
Status Standards. November 1981; Development Planning & Research
Associates, Impact Analysis flf Proposed RCRA-FSS Regulations
1980-1990. November 1980; and information provided by industry
sources or by OSW personnel.
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Exhibit II-l
LIST OF CURRENTLY-PRACTICED ACTIVITIES
SIGNIFICANTLY AFFECTED BY THE PROPOSED CHANGES1
Activity No.^ Activity Description
Activities Subject to Decreased Requirements
16a On-site reclamation of listed spent materials
(spent solvents).
17a On-site reclamation of listed sludges.
18a On-site reclamation of listed by-products.
23b Off-site reclamation of non-listed sludges (for
reclamation of lead, copper, zinc, aluminum,
mercury and tin) where the reclaimed material
is not used by the reclaimer.
46a On-site use and reuse of listed spent materials
(spent pickle liquor).
48a On-site use and reuse of listed by-products.
49a Off-site use and reuse of listed spent materials
(spent pickle liquor).
50a and b Off-site use and reuse of listed and non-listed
sludges.
Activities Subject to Increased Requirements
22b Off-site reclamation of non-listed spent materials
(spent solvents, spent activated carbon, spent
catalysts and metals) where the reclaimed material
is not used by the reclaimer.
28b and 31b Off-site reclamation of non-listed spent materials
(spent lead-acid batteries).
^Includes only those activities for which the number of affected
establishments was estimated by JRB.
2
Activity numbers are those used in the JRB report, op. cit.
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Exhibit II-2
ESTABLISHMENTS AFFECTED BY PROPOSED CHANGES IN THE DEFINITION
OF SOLID WASTE AND MANAGEMENT STANDARDS FOR WASTES THAT ARE RECYCLED
Activity
16a
Industry (SIC)
Paint & Allied Products (2851)
on-site
reclam.
listed Metals Manufacturing (35, 36, 37, 39)
sp. matr'ls
Pesticide Production (2879)
Pharmaceuticals (2833)
Dry Cleaning (7216)
17a
on-site
reclam.
listed
sludges
Secondary Lead Smelters (3341)
0 Facilities
Affected
66
2322
530
1240
360-720
4158-4878
100
Nature of Change in Requirements
Reduced generator and reduced "short
storage" requirements (40CFR262.34) due
to reduced volume of hazardous wastes
being regulated.
Reduced generator requirements and reduced
storage requirements due to reduced volume
of hazardous wastes being regulated.
(Listed emission control dusts usually
stored in piles; therefore, released from
'storage requirements; contains no free
liquids).
18a
on-site
reclam.
listed
by-prods.
Chlorine Producer (Mercury Cell)
(2812)
Reduced generator and storage requirements
due to reduced volume of hazardous wastes
being regulated. (Brine purification muds
usually stored in piles; therefore, released
from storage requirements).
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Activity
Industry (SIC)
22b** Paint & Allied Products (2851)
off-site
reclam.
non-listed
sp.matr'Is
Solvent Reclaimers
28b and 31b Secondary Lead Smelters (3341)
on-site reclam.
non-listed sp.
matr'ls and
off-site reclatn[.ndependent Battery Crackers
non-listed
sp. matr'ls
23b Secondary Lead Smelters (3341)
off-site
reclam.
non-listed
sludges
Secondary Zinc Smelters (3341)
Exhit II-2
(con't)
// Facilities
Affected Nature of Change in Requirements
42* Newly regulated as generators and as "short
storers" (under 40CFR262.34) of non-listed
solvents being sent to off-site reclaimers,
except solvents reclaimed under batch
tolling arrangements.
150-200 Additional storage facility requirements
for non-listed solvents which are reclaimed,
except solvents reclaimed under batch
tolling agreements; in addition, reduced
storage facility requirements for listed
solvents (which are currently regulated)
when reclaimed under batch tolling agree-
ments .
60-80 Additional storage facility requirements
due to cracking of spent batteries (store
in trailers/drums/piles).
20-50 Additional storage facility requirements
due to cracking of spent batteries (store
in trailers/drums/piles).
103 Reduced storage facility requirements
associated with reclamation of lead from
non-listed sludges (sludges from battery
mfgr. and sludges from production of
tetraethyl lead).
50 Reduced storage facility requirements
associated with reclamation of zinc from
non-listed sludges from numerous sources
(brass mills, secondary copper smelters,
etc.).
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Exh II-2
(con*t)
Activity
46a
on-site
use/reuse
listed
sp. matr'ls
48a
on-site
use/reuse
listed
by-prods
Industry (SIC)
Steel Finishers (3315-3317)
Steel Hills (3312) (Coking Operations)
Organic Chemical Producers (2869)
0 Facilities
Affected
8
30
17
49a
off-site
use/reuse
listed
sp. matr'ls
Steel Finishers (3315-3317)
10
60
Nature of Change in Requirements
Reduced generator and "short storage"
requirements (40CFR262.34) associated
with on-site use/reuse of spent
pickle liquors in wastewater treatment
facilities.
Reduced generator and "short storage" re-
quirements (40CFR262.34) due to on-site
use/reuse of decanter tank tar sludge from
coking operations. (Contains no free liquids.)
Reduced generator and "short storage"
requirements (40CFR262.34) associated
with on-site use/reuse of listed by-
products as raw materials (2 facilities
reusing 5 by-products each, 2 reusing 3
each, the remainder reusing 1 each).
Reduced generator and "short storage"
requirements (40CFR262.34) associated
with spent pickle liquor being sent
off-site (to Canada) for use/reuse in
wastewater treatment facilities.
Reduced generator and "short storage"
requirements (40CFR262.34) for spent
pickle liquor being sent to off-site
domestic facilities for use/reuse in
wastewater treatment facilities, water
purification facilities, and in iron
oxide or ferric chloride production.
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Exhl. - II-2
(con't)
// Facilities
Activity Industry (SIC) Affected
49a Iron Oxide Producers (2819) 4
(con't)
It II,
Ferric Chloride Producers (2819) 10
Water Purification Plants 2
Brokers Handling Pickle Liquors 8
Privately-Owned Wastewater Treatment 4
Facilities
Publicly-Owned Treatment Works (POTWs) 47
Nature of Change in Requirements
Released from storage facility require-
ments (and thus relieved from all re-
quirements under the hazardous waste manage-
ment regulations) associated with accept-
ance of spent pickle liquors for use/reuse.
Reduced storage facility requirements
associated with acceptance of spent
pickle liquors for use/reuse.
Reduced storage facility requirements
associated with acceptance of spent
pickle liquors for use/reuse.
Released from storage facility require-
ments (and thus relieved from all re-
quirements under the hazardous waste manage-
ment regulations) associated with
acceptance of spent pickle liquors for
use/reuse in water purification.
Reduced storage facility requirements
associated with acceptance of pickle
liquors for resale and reuse.
Reduced storage facility requirements
associated with acceptance of spent
pickle liquor for use/reuse in waste-
water treatment.
\
Released from permit-by-rule require-
ments (40CFR122.26(c)) associated with
acceptance of spent pickle liquors for
use/reuse in wastewater treatment.
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Exh-^t II-2
(con11)
Activity
50a and b
off-site
use/reuse
listed &
non-listed
sludges
Industry (SIC)
Fertilizer Manufacturers (2873/2874)
// Facilities
Affected
Fertilizer Manufacturers (2873/2874)
20
Nature of Change in Requirements
Released from storage facility require-
ments (and thus relieved from all
requirements under the hazardous waste
management regulations) associated with
acceptance of listed emission control
dusts from steel producers used/reused
for their zinc content. (Contains no
free liquids.)
Released from storage facility require-
ments (and thus relieved from all
requirements under the hazardous waste
management regulations) associated with
acceptance of non-listed sludges from
metal finishing facilities used/reused
for their zinc content.
Estimate adjusted as described in Appendix B.
A ^
Three carbon reclaimers were estimated by JRB to be newly regulated as storage facilities due to the acceptance
of non-listed spent carbon (under the present regulations these wastes are not regulated when reclaimed). However,
as a result of additional changes to the proposed management standards, we now estimate that no carbon reclaimers
will be affected by the proposed changes to the hazardous waste management regulations. See Appendix B for details.
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Exhibit II-3
CHARACTERISTICS OF AFFECTED ESTABLISHMENTS
Activity Industry (SIC)
16a
17a
Paint & Allied
Products
(2851)
Metals Manufacturing
(35,36,37,39)
Pesticide Production
(2879)
Pharmaceuticals
(2833)
Dry Cleaning
(7216)
Secondary Lead
Smelters
(3341)
Storing in Containers
No. of Average
Facilities Volume*
Storing in Tanks
51
2,055
324
726
180
142
927
5,000
500
40
No. of
15
267
206
514
180
Average
Facilities VolumeJ
727
1,000
5,000
1,500
100
Storing in Waste Piles
No. of Average
Facilities Volume*
100
5,600
18a
Chlorine Producer
(Mercury Cell)
(2812)
5,952
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Exhibit II-3
(con't)
Activity
22b
28b and 31b
23b
46a
48a
Industry (SIC)
Paint & Allied
Products
(2851)
Solvent Reclaimers
Solvent Reclaimers
Secondary Lead
Smelters
(3341)
Independent Battery
Crackers
Secondary Lead
Smelters
(3341)
Secondary Zinc
Smelters
(3341)
Steel Finishers
(3315-3317)
Steel Mills
(3312)
(Coking Operations)
Storing in Containers
No. of Average
Facilities Volume1
37 154
25
20002
75
290 2
70
18,0003
25
18,0003
42
2,000
1
16,000
5
2,000
Storing in Tanks
Storing in Waste Piles
No. of Average No. of Average
Facilities Volume^ Facilities Volume^-
506
>2
75 290'
25 2000
a
1 • 16,000
25 2,000
3
10 18,000
25 18,0003
61 2,000
50 2,000
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Exhibit II-3
(con* t)
Activity Industry (SIC)
48a
(con* t)
49a
Organic Chemical
Producers^
(2869)
Steel Finishers
(3315-3317)
Steel Finishers
(3315-3317)
Iron Oxide Producers
(2819)
Iron Oxide Producers
(2819)
Ferric Chloride
Producers
(2819)
Water Purification
Plants
Brokers Handling
Pickle Liquors
Privately-Owned
Wastewater Treatment
Facilities
Publicly-Owned
Treatment Works (POTVfs)
Storing in Containers
Average
Volume1
No. of
Facilities
1
1
2
1
5
1
2
1
10,000
6,000
2,000
16,000
16,000
*f
I
njaoo
1,000,000"
500,000
1,000,000
1,000,000
Storing in Tanks Storing in Waste Piles
No. of Average No. of Average
Facilities Volume^ Facilities Volume1
1 10,000
1 6,000
11 2,000
9 16,000
55 16,000
3 36,600
2 36,600
10 314,000
1 1,000,0005
6 500,000
3 1,000,0005
41 1,000.0005
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Exhibit II-3
(cop't)
Activity Industry (SIC)
Storing in Containers
No. of
Facilities
Average
Volumel
Storing in Tanks
No. of
Facilities
Average
Volume*-
Storing in Waste Piles
No. of
Facilities
Average
Volumel
50a and b
Fertilizer
Manufacturers
(2873/2874)
Fertilizer
Manufacturers
(2873/2874)
20
4,540
1,000
Average annual volume of wastes affected by the proposed changes, in metric tons.
2
Estimate based on information provided in the Background Document: Subtitle C, Identification and
Listing of Hazardous Waste (Finalization of May 19, 1980 Hazardous Waste List), November 14, 1980
pp. 44; adjusted as described in Appendix B.
3
Estimate based on information provided to 0SW personnel by industry sources.
4
Seventeen facilities, two of which experience'reduced requirements for five wastes each, two for
three wastes each and 13 for one waste each, with estimated average volume per affected waste of
2000 MT/year.
5
Estimate provided by OSW personnel.
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UNIT COSTS OF CHANGES IN
REGDLATORY REODIREMENTS
CHAPTER 3
This chapter presents estimates of unit compliance costs for
the RCRA requirements affected by the proposed, changes. The
basic cost estimates were obtained from previous cost impact
analyses performed for or by EPA, and were adjusted by IEc to
provide unit cost estimates in a form suitable for this analysis.
Except where regulatory requirements have changed or more recent
cost data are availabler IEc did not change the basic cost esti-
mates reported in these previous studies.
SOURCE OF COST ESTIMATES
IEc obtained estimates of unit compliance costs for the
affected regulatory requirements from a number of sources. The
costs of activities required under Interim Status were obtained
from the Arthur D. Little, Inc. (AOL) Economic Impact Analysis
for those regulations.1/ The costs for the revised financial
assurance requirements were calculated based on the results of
the Regulatory Impact Analysis for those regulations, 2/ as
adjusted in the Regulatory Analysis for the land disposal
1/Arthur D. Little, Inc., Economic Impact Analysis gf. RCRA Interim
Status Standards. November 1981.
2/Putnam, Hayes & Bartlett, Inc., and Industrial Economics, Inc.,
Regulatory Impact Analysis of Financial Assurance and
Liability insurance Regulations# September 1981.
3-1
-------
regulations.!/ Cost estimates for Final (General) Status
Standards for waste piles were also obtained from the Regulatory
Analysis for the land disposal regulations.!/ Estimates of Final
(General) Status Standard costs for the other affected storage
practices (tanks and containers) were obtained from preliminary
analyses performed by OSW personnel. JRB Associates has de-
veloped more refined estimates of certain tank and container
compliance costs. Where possible, the preliminary OSW cost esti-
mates were updated based on the results of the JRB study.5./
ONIT COST ESTIMATES
IEc categorized the unit costs of each requirement into
initial expenses and capital investments (which are one-time
expenditures incurred at the outset to comply with RCRA), recur-
ring annual costs, and costs incurred at the end of facility life
(closure costs). In addition, costs are distinguished by whether
they are fixed or variable with respect to the number or volume
of wastes handled. Finally, all costs are expressed as
annualized after-tax costs, in constant 1981 dollars. Appendix C
describes the adjustments made to the unit cost estimates in more
detail.
Unit costs were developed for the generator requirements,
the Interim Status Standards (ISS) which apply to establishments
prior to receiving permits, and the Full (General) Status
Standards which add design, operating, and other standards to the
ISS requirements already in effect. The regulatory requirements
affected by the proposed changes and the unit compliance costs
for each requirement are presented in separate sections below.
3,/Unit costs for the various land disposal requirements were
obtained from Sobotka & Company, Inc. and Pope-Reid Associates.
These cost estimates were subsequently published in the Docket
Report, Supporting Documents for the Regulatory Analysis of the
Part 264 Land Disposal Regulations.
4/Ibid.
5/JRB Associates, Inc., Macro Profile; Cost Factors 1&T Storage
Facilities. Draft Report, March 1982. More complete estimates of
the costs of container and tank requirements are now being
prepared for OSW by Pope-Reid Associates. These cost
calculations were not available in time for use in this study.
3-2
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A. Generator Requirements
Generators who generate wastes that are recycled must com-
ply with the following requirements under RCRA (40 CFR 262)£/:
• Determine whether the wastes are hazardous by
consulting the list of hazardous wastes issued by
EPA (for listed wastes) or by determining whether
the waste exhibits any one of four characteristics
(ignitability, corrosivity, reactivity, or EP
toxicity); also determine whether the waste is
excluded from the hazardous waste management regu-
lations.
• Obtain an identification number from EPA.
• Meet the requirements specified for "short
storage" under 40 CFR 262.34 if wastes are stored
in tanks or containers for less than 90 days.
• Submit a biennial report on hazardous waste
activities.!/
Generators who ship wastes off-site for recycling must also
perform a number of additional recordkeeping and reporting
duties associated with manifests for the wastes shipped, and must
label containers and ship in approved containers. Generators who
contract for recycling under tolling arrangements (other than
batch tolling agreements which are proposed to be exempt from all
hazardous waste requirements) are not required to prepare mani-
fests for the wastes shipped but must meet other requirements for
shipping. In addition, generators of spent lead-acid batteries
are exempt from control under the Subtitle C regulations. There-
fore, manifesting and all other subsequent requirements do not
apply.
^/Hazardous wastes generated by small quantity generators—those
generating less than 1000 kg of hazardous waste per month or 1 kg
of acutely hazardous waste per month, or accumulating no more
than 1000 kg of hazardous waste or 1 kg of acutely hazardous
waste over any period of time—are conditionally excluded from
regulation under the hazardous waste management regulations.
Other specific wastes, such as pesticides used by farmers, are
also conditionally excluded from the hazardous waste management
regulations.
7/The Agency has substituted a biennial report for the annual
report proposed originally (48 Fed. Reg. 3977 (Jan. 28, 1983)).
3-3
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Exhibit III-l presents unit cost data for all generator
requirements except those associated with "short storage"
activities (for which unit costs are described later in this
section). All costs in this exhibit were obtained from the ADL
report on ISS requirements and were updated to 1981 dollars by
IEc. All existing generators that are affected by the proposed
changes are assumed to be in compliance with the hazardous waste
management regulations. Hence, for generators already subject to
RCRA regulations, all initial costs have already been incurred.
For establishments newly regulated under the proposed changes,
these costs have not yet been incurred.
B. Storage Facility Requirements:
general
Establishments that accept hazardous wastes from others and
store those wastes prior to recycling are subject to RCRA
requirements as storage facilities. Generators who store wastes
for more than 90 days prior to recycling in tanks or containers,
or in waste piles or surface impoundments for any length of time,
are also regulated as storage facilities. All storage facilities
must meet the general administrative requirements-as_ well as
standards specific to the type of storage used (tanks,
containers, waste piles or surface impoundments).
Exhibit III-2 presents unit cost estimates for the general
requirements affecting all storage facilities. These require-
ments include:
• obtaining an EPA identification number,
• application for Part A and Part B permits,
• biennial report on hazardous waste, activities,
• periodic inspections of the facility,
• contingency planning,
• personnel training,
• analysis of wastes being stored, with more exten-
sive requirements for off-site facilities receiv-
ing wastes from others (facilities performing
recycling under tolling arrangements will be
exempt from waste analysis requirements; re-
claimers of spent lead-acid batteries are also
exempt from the waste analysis requirements),
3-4
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preparation of a closure plan,
manifest handling (for wastes transported off-
site; will not be required, however, for
facilities recycling under non-batch tolling
arrangements),
obtaining liability insurance to cover claims for
injury to persons or property in the event of
sudden accidents,
closure of the facility at the end of the facility
life in accordance with the closure plan (specific
requirements for closure vary by type of storage
used) ,
providing assurance of financial capability to
cover estimated closure costs, assuming the maxi-
mum anticipated inventory of wastes is held at the
facility at the time closure is required, by using
one of several allowed instruments (trust funds,
insurance policy, letter of credit, or security
bond) or by meeting^ a test of financial strength.
The ADL report on ISS requirements describes these requirements
in more detail and is the source of all cost estimates shown in
Exhibit III-2.fl/ The ADL costs were updated to 1981 dollars by
IEc. Costs for closure and financial assurance requirements are
presented in the sections on specific types of storage facilities
below.
C. Storage Facility Requirements:
Containers
Aside from the general requirements described above, storage
facilities are subject to specific design and operating require-
ments for different types of storage methods. Facilities storing
hazardous wastes in containers (unless the containers are holding
hazardous wastes that do not contain free liquids) are required
to provide secondary containment by placing containers on an
8/With the exception of the costs of a Part B permit application
and liability insurance—see the notes to Exhibit III-2.
3-5
-------
impermeable base designed to control runoff. Preliminary cost
estimates for secondary containment were provided by OSW
personnel and are shown in Exhibit III-3.
All facilities were assumed to use containers that meet
Department of Transportation requirements for wastes ultimately
sent off-site and therefore no incremental costs are estimated
for upgrading containers when shipped. Facilities storing in
containers prior to on-site recycling are subject to goodhouse-
keeping requirements which do not specify the type of container
to be used. Again, no incremental expenditures to upgrade con-
tainers to meet those requirements were included in the estimated
costs.
Finally, containers must be emptied, materials and residues
must be disposed of in approved facilities< and containers must
be decontaminated at closure. Costs for closure were estimated
based on information provided by OSW personnel. Annual costs for
providing financial assurance for the estimated closure costs are
calculated using costs as a function of closure costs for each
instrument and assuming a distribution of the instruments used
(as described in the notes to Exhibit III-3).
D. Storage Facility Requirements:
Tanks
RCRA regulations specify design standards for tanks which
may require retrofit of some existing tanks. The regulations
also specify allowable inspection procedures and closure require-
ments (primarily decontamination of tanks). Preliminary esti-
mates of costs for these requirements were provided by OSW
personnel and are shown in Exhibit III-4.
E. Storage Facility Requirements:
Waste Piles
The land disposal regulations apply to facilities storing
wastes in waste piles. Under these regulations, facilities may
choose one of several combinations of design, inspection and
monitoring requirements. The regulations also require wind con-
trol and specify closure requirements. The unit costs of these
requirements were developed by Sobotka & Company, Inc., with
technical information provided by Pope-Reid Associates. The cost
estimates for storage in waste piles are shown in Exhibit III-5.
3-6
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F. "Short-Storage" Requirements
Generators who store hazardous wastes in tanks or containers
for less than 90 days prior to reuse/recycle are eligible under
Part 40 CFR 262.34 for less stringent storage requirements than
those applied to storage facilities. The "short-storage" re-
quirements include the following storage facility requirements:
• contingency planning and emergency equipment,
• personnel training,
• routine (ISS) inspection requirements.
The unit costs for these activities were described previously.
As with container storage facilities, no incremental costs are
calculated for upgrading containers at "short storage" establish-
ments using containers. Exhibit III-6 provides a summary of
costs for "short-storage" requirements.
g. "Permit-By-Rule" Requirements
Publicly-Owned Treatment Works (POTWs) handling hazardous
wastes are subject to limited requirements under 40 CFR 122.26.
POTWs must comply with their NPDES permits, must meet applicable
pretreatment standards, and must meet the notification, manifest
and reporting requirements imposed on other facilities under
RCRA. POTWs meeting these requirements will be issued a "permit-
by-rule." Decreases in regulatory requirements will affect only
the requirements imposed by RCRA; unit cost estimates for these
requirements are presented in Exhibit III.7
3-7
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Exhibit III-l
Requirement
UNIT COSTS FOR GENERATOR REQUIREMENTS
(all ISS; before-tax)
Initial Costs
Obtain EPA ID Numbers-
Test for Characteristics
Compliance Review for Waste
Designations
Document Uaste Inventory
Establish Off-site Shipping
Procedures^
Design Shipping System^
Manifest Preparation and
Container Labeling^
Manifest Signing, Handling,
Filing^
Exception Reports^
Report Storage
4
Biennial Report
Annual Costs
Fixed Variable
Fixed
Variable
838.00/
non-lisced waste
102.00/waste 138.00
152.00
478.00
926.00
955.00
407.00
152.00
.22/MT2
.06/MT"
88.00/
report
Included in storage facility and "short storage" unit costs only, to avoid
double-counting.
^$4.40/shipment, assuming 20 MT per shipment.
3
$25.40/report, assumed to be incurred once every 20 shipments, assuming
20 MT per shipment.
The cost of completing the report is equal to the annual report cost
reported in ADL. This cost will be incurred every other year.
Applies only to generators shipping wastes off-site. Generators shipping
wastes to off-site facilities for recycling under non-batch tolling agree-
ments are exempt from manifest requirements. Where the costs reported by
ADL include both container labeling and manifest requirements, generators
who are exempt from the manifest requirements are assumed to incur only
half of the reported costs. In addition, spent lead-acid batteries being
sent for reclamation are also exempt from generator requirements.
Source: ADL, op. cit., Appendix B, updated to 1981 dollars using inflation
indices in Exhibit C-l.
-------
Exhibit III-2
UNIT COSTS FOR STORAGE FACILITIES: GENERAL REQUIREMENTS
(all ISS except where noted; before-tax)
Requirement
Initial Costs
Fixed
Variable
Capital Costs
Annual Costs
Fixed
Variable
Fixed
Variable
Obtain EPA ID No.1
Prepare Waste Analysis Plan^»8
Prepare Inspection Plan
Part A Permit
Part B Permit (FSS)5
Closure Plan
Systems Design
Regulation Review
Design Training Course1
Prepare Contingency Plan1
Contingency Equipment
Training1
Maintain Training Records
Testing of Wastes -
On-Site-*
Testing of Wastes -
Off-Site2»4 »8
Inspections1
Manifest Handling2^ >8
Incident Reporting
Biennial Report
Liability Insurance'
44
7,763
130
5,041
8,373
1,902
1,515
597
14,726
1,890
12,000
5,850
179
4,420
1,040
940
407
141
51
1,500
3.25/MT
See attached for notes.
-------
Exhibit III-2
NOTES
^"Applies to "short storage" under 40CFR262.34 (see Exhibit III-6).
2
Applies only for wastes sent to off-site facilities.
3
Applies only for wastes managed at on-site facilities.
4
Does not apply to wastes recycled under non-batch tolling arrangements.
^An estimate of the cost of preparing a Part B permit application was
obtained from Pope-Reid Associates, who developed the estimate in con-
nection with their current work on the costs of container and tank
requirements. Pope-Reid's estimates of the costs of specific parts of
the Part B application were summed, using the following assumptions:
• seismic standard compliance is not required because only
new facilities must meet the standards and only existing
facilities are considered in this report;
• where different options for compliance were costed by
Pope-Reid, IEc used a simple average of the costs of. the
alternatives;
• IEc assumed that half of the affeced facilities would
have to develop new information to evaluate the applica-
bility of flood plain requirements and that 10% of the
facilities are located in flood plains.
6The cost of completing the report is equal to the annual report cost
reported in AOL. This cost will be incurred every other year.
^EPA has promulgated requirements for liability insurance. Land-based
disposal facilities are required to obtain coverage for damages resulting
from non-sudden events, while storage facilities must obtain coverage
only for sudden events. Costs for the required coverage were obtained
from the Regulatory Impact Analysis of the Financial Assurance and Liability
Insurance Regulations, prepared by Putnam, Hayes & Bartlett, Inc., and
Industrial Economics, Inc. (11 September 1981). That report assumes that
three-fourths of facilities already have the required sudden event coverage
under normal commercial policies. That assumption is adopted here.
g
Does not apply to storage facilities which subsequently reclaim spent
lead-acid batteries.
-------
Requirement
Exhibit III-3
UNIT COSTS FOR STORAGE FACILITIES: CONTAINERS
(before-tax)
Initial
Capital
Annual
Closure
Fixed Variable Fixed Variable Fixed Variable Fixed Variable
Secondary Containment^
(includes runoff
control) (FSS)
Closure^
Financial Assurance
for Closure^
2360 0.11/MT
0.22/MT
224 .033/MT
See attached for notes.
-------
Exhibit II1-3
NOTES
Secondary containment is required only for wastes containing free liquids.
Estimates of secondary containment costs for facilities with 100, 200
and 500 containers per facility were obtained from OSW personnel. These
costs were estimated as a function of facility lifetime capacity (con-
verted from numbers of 55 gal. containers per facility to metric tons per
facility using the conversion factors developed in Exhibit C-3) by fitting
a linear function to obtain the following cost function for secondary
containment:
cost = $2360 + $0.11/MT
Closure for container facilities requires removal of wastes and resi-
dues, decontaminating containers, and disposal of residues in approved
facilities. It is assumed that materials in containers are recycled
prior to closure, and therefore no costs for disposal of materials other
than residues are included in closure costs. The following closure costs
are calculated based on estimates provided by OSW personnel:
drum reconditioning $6.50/container (55 gal.)
transportation and $6.53/container (.125 x. 55 gal. = 6.875 gal.
disposal of residue residue/container; $.50/gal. disposal +
$ .45/gal. transportation)
total closure costs = $13.03/container
Closure costs as a function of facility lifetime capacity (converted from
number of containers to metric tons using the conversion factors shown in
Exhibit C-3)are calculated as follows:
lifetime capacity = 55 gal./container x 12 times per year turnover
x 20 year lifetime t 220 gal./MT
= 60 MT per container
cost = $13.03/container t 60 MI lifetime capacity per container
= $ .22/MT lifetime capacity
'Facilities must provide financial assurance for the costs of closure
assuming the maximum anticipated inventory has to be removed at the
time of closure. For storage prior to recycling, removal of wastes is
not included as an incremental closure cost but financial assurance
must be demonstrated for both the incremental costs of closure and the
costs of removing and disposing of the stored materials in approved
facilities.
The amount for which financial assurance must be provided includes the
costs estimated for closure (note 2 above) plus an estimated $.95/gal.
or $52.25/container for disposal of materials (estimate obtained from
OSW personnel). This equals $.87 per MT of lifetime capacity, where
lifetime capacity is calculated as shown in note 2 above. Assuming that
all containers are full at the time of closure, the cost for which financial
assurance must be provided is therefore:
cost = $ .87/MT + .22/MT
¦» $1.09/MT lifetime capacity
-------
Exhibit III-3
NOTES
(con't)
The annual cost of providing financial assurance for this amount depends
on the instruments used to provide assurance (trust funds, financial tests,
insurance, letters of credit,or surety bonds).
In analyzing financial assurance costs for the Regulatory Impact Analysis
for the land disposal regulations, OSW assumed the following distri-
bution of facilities by type of instrument used:
50% financial test
18% trust fund
18% insurance
14% letters of credit and surety bonds
This distribution is also assumed for this cost analysis. Annual costs for
the individual instruments as a function of the amount of funds assured
were obtained from the Regulatory Impact Analysis of the Financial Assur-
ance and Liability Insurance Regulations, as follows:
Instrument 1981 Annual Cost (before tax)
financial test $78
trust fund $514 + .1424 x C
insurance $514 + .0142 x C
letters of credit .0174 x C
and surety bonds
where c equals the before-tax amount for which financial assurance
must be provided. Weighting the cost functions by the distribution of
facilities by instrument used provides the following weighted average
cost function for financial assurance:
annual cost » $224 + .0306 x C
Since C for container facilities is $1.09/MT, the annual cost of financial
assurance is:
cost - $224 + .0306 ($1.09/MT)
- $224 + $.033/MT
-------
Exhibit III-4
Requirement
3
Recoating (FSS)
(retrofit)
Inspections: (FSS)^
Inspection Gauge
Decontamination
for Inspection
Closure^
Financial Assurance for
Closure (ISS)^
UNIT COSTS FOR STORAGE FACILITIES: TANKS
(before-tax)
Initial Capital Annual Closure
Fixed Variable Fixed Variable Fixed Variable Fixed Variable
6,470 .126/MT
1,150
310 .085/MT
620 ,031/MT
243 .007/MT
See attached for notes.
-------
Exhibit III-4
NOTES
Comprehensive inspections may be performed without emptying tanks by using
an ultrasonic gauge (cost 3 $2300) or by emptying and decontaminating the
tank and inspecting the inside visually (see note 2 for cost of decontami-
nation) . Half of tank storage facilities are assumed to inspect with a
gauge and half by visual inspection. Periodic inspections are assumed to
be made once a year. Therefore, one-half of the facilities incur a capital
cost of $2300 for purchase of a gauge (or an average of $1150 for all faci-
lities) and one-half incur annual costs of $620 +¦ .17/MT for decontaminating
tanks (or an average for all facilities of half that amount—$310 + .085/MT).
The cost of the inspections themselves is included in general storage faci-
lity costs (Exhibit III-2).
2
Closure requires removing and disposing of materials and residues in
tanks and decontaminating the tanks. Since materials are removed
and recycled, no incremental closure cost for disposal of materials
was estimated. OSW's estimates of decontaminating costs per tank
are:
Tank Size Capital Cost/Tank
(gals)
10,000 $1,000
20,000 1,300
50,000 2,200
In order to develop a cost function for decontaminating tanks, IEc
calculated costs for various facility sizes assuming different tank
sizes and numbers of tanks. It was assumed that the maximum tank size
used for waste storage was 50,000 gallons based on conversations with
OSW personnel.
Number
Tanks
Size of
Tanks
(gals)
Decontamination
Cost
Annual
Capacity
(MT)
2
10,000
$ 2,000
2,000
50,000
4,400
25,500
5
50,000
11,000
63,750
10
50,000
22,000
127,500
25
50,000
55,000
318,750
A linear function was fit to costs and lifetime capacity (20 years x annual
capacity) to provide the following cost function for tank decontamination
at the time of closure:
cost =» $620 + $.008/MT lifetime capacity
The same costs were also expressed as a function of annual capacity to
calculate the costs of decontamination for annual inspections (see note 1
above). The resulting cost function is:
cost = $620 + .17/MT annual capacity
-------
Exhibit III-4
NOTES
(con't)
2
Estimates of costs for disposal of residues were also obtained from OSW
personnel, as follows:
.125 x tank capacity ¦ amount of residue; cost of transport and
disposal of residues 3 $.95/gal.
Calculating costs for a 50,000 gal. tank (assuming 12,750 MT/annual capacity
per 5Q,000 gal. tank from Exhibit C-3) yields the following estimate for
residue disposal:
cost s (amount of residue/tank x cost of residue disposal] t lifetime
» (.125 x 50,000 gal. x -95/gal.) t 255,000 MT/tank capacity
3 .023/MI per tank
The total cost of closure is therefore:
cost =» $620 + $ .031/MT
3
If tanks do not meet the design standards specified in Part 264, the
tanks must be replaced or recoated. For this analysis, it was assumed
that one-third of the storage tanly would have to be recoated to meet the
Part 264 standards. OSW personnel'provided the following unit costs
for recoating tanks.
Tank Size Cost/Tank
(gals)
10,000 $ 11,166
20,000 17,588
50,000 32,397
IEc calculated the following costs for different facility sizes, assuming
different numbers and sizes of tanks:
Number
Tanks
Size of
Tanks
(gals)
Recoating
Cost
Annual
Capacity
(MT)
2
10,000
$ 22,332
2,000
50,000
64,794
25,500
5
50,000
161,985
63,750
10
50,000
323,970
127,500
25
50,000
809,925
318,750
A linear function was fit to these costs and lifetime capacity to provide
the following cost function for recoating:
cost - $6470 + $0.12fi/MT
-------
Exhibit III-4
NOTES
(con't)
4
As descrihed In aoce 3 to Exhibit III-3, financial assurance must be
provided for the maximum potential cost of closure, including removal
and disposal of materials stored in tanks at the time of closure.
For tanks, the costs for which assurance must be provided include
the closure costs calculated above plus the cost of removing and
disposing of materials at a cost of $ .95/gal. removed. Based on
the facility sizes used previously, and assuming that tanks are full
at the time of closure, the cost of materials disposed (expressed as
a function of lifetime capacity) is:
cost » (amount to be disposed/tank x cost of disposal) t lifetime capacity
» (50,000 gal. x .95/gal.) * 255,000 MT/tank
- .186/MT
The total amount for which financial assurance must be provided is
therefore:
cost - 620 + $.217/MI
Assumptions used to estimate the annual cost of providing financial
assurance are described in note 3 to Exhibit III-3. The annual cost
developed In that note as a function of the amount for which assurance
must be provided (C) is $224 + .0306 x C. The annual cost of financial
assurance for tanks is therefore:
cost - $224 + .0306 (620 + .217/MT)
= $243 + .007/MT
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Exhibit III-5
UNIT COST FOR STORAGE FACILITIES: WASTE PILES
(before-tax)
Requirement Initial
Fixed Variable
Sturdy Base (FSS)*
Groundwater Monitoring 2,140
2
Closure
3
Financial Assurance
Capital Annual Closure
Fixed Variable Fixed Variable Fixed Variable
17,168 .021/MT
15,000 750
80,690 .249/MT
2,693 .027/MT
Storage facilities storing in waste piles have several options for complying with the land disposal
regulations. For this cost analysis, it was assumed that all facilities install the sturdy (Impermeable)
base and that half Inspect by moving the waste pile for visual inspection. No incremental costs are
assumed for Inspection because it is assumed that the base will be inspected when wastes have been removed
for recycling. The other half of the facilities do not Inspect the base visually and, therefore, must
conduct groundwater monitoring. Therefore, only half of the facilities will incur the groundwater monitoring
costs (initial costs of $4,280, capital costs of $30,000, and annual costs of $1,499).
2
Closure of waste piles requires excavation, transport and disposal of the contaminated base. No Incremental
cost is assumed for disposal of materials in the waste pile, which are assumed to be recycled prior to closure.
3
Financial assurance must be provided for the cost of disposing of materials in the waste pile as well as for
the incremental closure costs estimated above. These disposal costs are $.625 per metric ton of lifetime
facility capacity. Therefore, financial assurance must be provided for a total of $80,690 plus $.874 per
metric ton. As described in note 3 to Exhibit III-3, the annual financial assurance costs are $224 + .0306 x C,
where C is the cost for which financial assurance must be provided. Therefore, the annual cost of financial
assurance for waste piles is:
cost - $224 + .0306 ($80,690 + .874/MT)
= $2,693 + .027/MT
-------
Exhibit III-6
Requirement
UNIT COSTS FOR "SHORT STORAGE" REQUIREMENTS
(all ISS; before tax)
Initial
Capital
Annual
Closure
Fixed Variable Fixed Variable Fixed Variable Fixed Variable
EPA ID Number
Design Training Course
Contingency Plan
Training
Training Records
Inspections
Contingency Equipment
44
14,726
1,890
5,850
179
940
12.00Q
Source: See Exhibits III-3, III-4 and III-5.
-------
Exhibit III-7
UNIT COSTS FOR "PERMIT-BY-RULE" REQUIREMENTS
(all ISS; before-tax)
Requirement
EPA ID Number
Manifest Handling
Incident Reporting
Biennial Survey
Initial
Annual
Fixed
44
Variable
Fixed
407
141
55
Variable
Source: Exhibit III-2.
-------
COST IMPACT OF PROPOSED CHANGES IN
THE DEFINITION OF SOLID WASTE AND
MANAGEMENT STANDARDS FOR WASTES
THAT ARE RECYCLED CHAPTER 4
This chapter presents estimates of the changes in cost
resulting from the proposed changes in the definition of solid
waste and management standards. The next chapter provides a more
detailed discussion of the impact on those industries which will
experience increased requirements.
Changes in compliance costs for each establishment were
calculated by applying the unit cost estimates discussed in the
previous chapter to the estimated average volumes of wastes
affected. These average costs were then multiplied by the number
of affected establishments in each industry to calculate aggre-
gate cost savings or increases.
The procedures used generally yield a "worst-case" estimate
of cost impacts, by understating savings and overstating
increases, for the following reasons:
• JRB's estimate of the number of establishments
affected were consistently conservative, in that
the number of facilities identified as having
increased requirements was overstated and the
number with reduced burdens understated.!/
1/The JRB report discusses the nature of possible over- and
understatements.
4-1
-------
• Where JRB reported a range for the number of
establishments affected, costs were calculated for
the maximum number of establishments with
increased regulatory requirements, and for the
minimum number of establishments with reduced
regulatory requirements.
• These calculations assume that the affected estab-
lishments will continue their current activities
despite increased or decreased costs resulting
from the proposed changes. For example, it is
assumed that paint and allied product
manufacturers who use non-listed solvents, and who
will be newly-regulated under RCRA, will continue
to use non-listed solvents in the same quantities.
In fact, the affected industries may be able to
reduce the costs of the proposed changes by
switching to other solvents or otherwise altering
their activities. By assuming no such adjust-
ments, the calculations overstate cost increases
and understate cost savings.
• Finally, some of the establishments identified as
having reduced regulatory requirements may in fact
be released from regulations entirely if, as a
result of the proposed changes, the volume of
hazardous wastes they generate drops below the
1000 kg/month "small quantity generator" cutoff.
If released from the hazardous waste management
regulations, these establishments would experience
cost savings larger than those estimated in this
report. No attempt was made in this study to
estimate how many of the establishments with re-
duced regulatory requirements would in fact be
released from the hazardous waste management
regulations.
In addition, aggregate cost impacts were calculated in two ways.
The first relies on a "best estimate" of the unit costs for the
affected regulatory requirements, and the second relies on maxi-
mum unit cost increases for establishments facing increased re-
quirements and on minimum unit cost savings for establishments
subject to decreased requirements. The "best estimate" and maxi-
mum increase/minimum savings or "worst case" unit costs differ as
follows:
4-2
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"Best Estimate"
"Worst Case"
three-fourths of the
establishments already
have the required liability
insurance for sudden events.
one-third of storage tanks
require recoating to meet
design standards.
• no establishments with
increased requirements
currently have the re-
quired coverage; all
establishments with de-
creased requirements have
such coverage (and will
continue to after the
proposed changes).
• all tanks at establish-
ments with increased
requirements require
recoating; no tanks at
establishments with
decreased requirements
require recoating.
Exhibit IV-1 summarizes the ("best estimate") changes in
compliance costs resulting from the proposed changes in the
definition of solid waste and management standards for wastes
that are recycled. The costs shown are the annualized after-tax
cost savings or increases-experienced, byjthe regulated community
as a whole. The results show that the proposed changes will
cause an estimated net decrease in compliance costs to the
affected establishments of $24.4 million. This figure represents
the sum of increases and decreases in annualized costs for all
affected establishments, including:
• A decrease in costs of $24.7 million for estab-
lishments with reduced regulatory requirements or
for establishments which are released from the
hazardous waste management regulations entirely.
• An increase in costs of $0.3 million for newly-
regulated establishments or for those facing in-
creased regulatory requirements.
In those industries which will experience increased regu-
latory requirements, 42 establishments are expected to be newly-
regulated under the hazardous waste management regulations, with
average annualized compliance costs of $5600 each. Another 200
establishments that are already regulated under the hazardous
waste management regulations are expected to incur an average
increase of $500 in annualized compliance costs. A somewhat
larger number of establishments will have reduced regulatory
burdens under the proposed changes—76 establishments being re-
leased from the hazardous waste management regulations entirely.
4-3
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with average annualized cost savings of $50,400 per establish-
ment, and 299 establishments^/ with average cost savings of
$70,300 due to reduced regulatory requirements.
In the aggregate, then, the proposed changes result in net
cost savings to the regulated community. Considering only those
aspects of the changes which cause increased requirements, the
resulting cost increases are well below the $100 million
criterion for "major rules."
The size of estimated cost increases and decreases, while
not a burden to the regulated community in the aggregate, varies
for different industries depending on the volumes of wastes
affected, on the extent of baseline regulatory requirements for
wastes which will not be affected, and on the types of storage
used. Exhibit rv-2 presents the estimated changes in compliance
costs for each affected activity and industry (again, based on
the "best estimate" calculations). That exhibit shows that,
while moderate savings are experienced by a large number of
establishments, large volume on-site reclaimers of spent solvents
(pesticides and pharmaceuticals producers) and establishments
reusing spent pickle liquor (iron oxide and ferric chloride
producers, public and private wastewater treatment works, and
water purification plants) account for a large portion of the
aggregate savings.
Only three industry categories are expected to experience
cost increases, as a result of off-site reclamation for non-
listed spent materials. The largest estimated cost increases are
incurred by paint and allied product establishments sending non-
listed solvents to off-site reclaimers- In addition, contract
solvent reclaimers and independent battery crackers will experi-
ence moderate increases in costs. Secondary lead smelters who
crack batteries will be subject to increased requirements for
that activity, but also experience cost savings associated with
reduced requirements for other activities. As shown in Exhibit
IV-3, these smelters will experience a net decrease in costs when
all changes in requirements are considered.
A large number of establishments (4,582) are subject to
decreased requirements under the proposed regulations but were
found to experience negligible cost savings as a result. Because
these facilities are regulated as on-site generators and "short
2/The proposed changes also decrease regulatory requirements for
another 4,582 establishments, but these establishments are
expected to experience only negligible cost savings as a result.
4-4
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storers," the reduction in volumes regulated as hazardous is
expected to have a negligible impact on costs. Most of the costs
associated with on-site generation and short storage are initial
expenditures and are not affected by subsequent changes in the
volume of waste regulated. Other costs may in fact vary with the
volume of waste handled but were estimated as fixed costs in the
sources used for cost data. For example, the cost of inspections
is likely to vary with the volumes of waste stored but is treated
here as a fixed cost. Where costs that vary somewhat with
volume are estimated as fixed, cost savings for establishments
with decreased volumes and cost increases for establishments with
increased volumes are both understated. The number of establish-
ments experiencing decreases in the volume of regulated waste
(4,928) is substantially larger than the number of establishments
with increased burdens (200) . Therefore, the effect of treating
as fixed some costs which in fact vary with volume is to under-
state the total cost savings resulting from the proposed changes.
The results of the "worst case" calculations are summarized
in Exhibit IV-4. A comparison of that exhibit with Exhibit IV-1
shows that use of "worst case" assumptions (which minimizes
estimated cost savings and maximizes estimated cost increases)
has little impact on the aggregate results of the analysis.
4-5
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Exhibit IV-1
SUMMARY OF CHANGES IN COMPLIANCE COSTS
DUE TO PROPOSED CHANGES: "BEST ESTIMATE"
(annualized costs in thousands of 1981 dollars, after-tax)
Number of Affected
Establishments
Total Cost
Impact
Average Change
in Costs per
Establishment
Establishments with
Increased Requirements:
Newly Regulated
Increased Burden
42
200
235
91
$ 5.6
0.5
Establishments with
Decreased Requirements:
Released from RCRA 76 (3833) (50.4)
Reduced Burden 298* (20,939) (70.3)
Excludes 4582 establishments for whom regulatory requirements decrease
but who are estimated to experience negligible cost savings as a
result.
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Exhibit IV-2
CHANGES IN COMPLIANCE COSTS
DUE TO PROPOSED CHANGES BY INDUSTRY: "BEST ESTIMATE"
(annualized after-tax; 1981 dollars)
Activitv
Number
16a
Industry
Paint & Allied
Products
Metals
Manufacturing
Pesticide
Production
Pharmaceuticals
Dry Cleaning
Number of
Establishments
51
15
2,055
267
324
206
726
514
180
180
Type of
Storage
C
T
C
T
C
T
C
T
C
T
Increase (Decrease) in
Compliance Costs
Average per
Establishment
($)
0
0
0
6
0
0
0
0
0
0
Total
($ thousands)
0
0
0
0
0
0
0
0
0
0
17a Secondary Lead
Smelters 2
100
WP
(106)
(10.6)
18a Chlorine Producer 1
22b Paint & Allied 37
Products 5
Solvent 25
Reclaimers 25
Solvent 75
Reclaimers 75
28b and 31b Secondary Lead 70
Smelters 2 10
Independent Battery 25
Crackers 25
WP
C
T
C
T
C
T
C
WP
c
WP
(113)
5,598
5,647
(3,298)
(3,334)
477
483
432
342
432
342
(0.1)
207.1
28.2
(82.5)
(83.4)
35.8
36.2
30.2
3.4
10.8
8.6
23b Secondary Lead
Smelters 2
Secondary Zinc
Smelters
46a Steel
Finishers
42
61
50
1
7
C
WP
WP
C
T
(3,298)
(3,288)
(3,288)
0
¦0
(138.5)
(200.6)
(164.4)
0
0
-------
Exhibit IV-2
(coil't)
Increase (Decrease) in
Activity Industry Number of Type of Compliance Costs
Number Establishments Storage Average per
Establishment Total
($) ($ thousands)
48a Steel 5
Mills 25
Organic 1
Chemicals 1
1
1
7
6
49a Steel 1
Finishers 9
Steel 5
Finishers 55
Iron Oxide 1
Producers 3
Iron Oxide Producers 2
Ferric Chloride 10
Producers
Water Purification 1
Plants 1
Brokers of Pickle 2
Liquor 6
Wastewater Treatment 1
Facilities 3
POTWs 6
41
C
0
0
T
0
0
C
0
0
T
0
0
C
0
0
T
0
0
C
0
0
T
0
0
C
(2,240)
(2.2)
T
(2,240)
(20.2)
C
(2,240)
(11.2)
T
(2,240)
(123.2)
C
(24,489)
(24.5)
T
(66,265)
(198.8)
T
(61,-012)
(122.0)
T
(523,438)
(5,234.4)
C
(1,654,031)
(1,654.0)
T
(1,672,253)
(1,672.2)
C
(824,500)
(1,649.0)
T
(833,500)
(5,001.0)
C
(1,649,000)
(1,649.0)
T
(1,667,000)
(5,001.0)
C
(613)
(3.7)
T
(613)
(25.1)
50a and b Fertilizer 3 WP (16,135) (48.4)
Manufacturers
Fertilizer 20 WP (10,315) (206.3)
Manufacturers
^C 13 containers, T = tanks, WP = waste piles, SI 3 surface Impoundments.
2See Exhibit IV-3.
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Exhibit IV-3
ADJUSTMENTS FOR SECONDARY LEAD SMELTERS AFFECTED
BY CHANGED REQUIREMENTS FOR MORE THAN ONE ACTIVITY
Number of ^ Activity Increase (Decrease) Net Increase (Decrease)
Establishments'
in CostsJ
in Costs
Per Establishment
Total
80
17a
23b
28b and 31b
(106)
(3,292)
421
(2,977)
(238,160)
20
17a
23b
(106)
(3,292)
(3,398)
(67,960)
23b
(3,292)
(3,292)
(9,876)
^Weighted average for different types of storag'e, based on "best estimate"
calculations.
2
As shown in Exhibit II-2, 103 secondary lead smelters are subject to reduced
requirements associated with reclamation of land from non-listed sludges
(activity 23b). It is assumed that the 100 smelters subject to reduced costs
associated with activity 17a are a subset of the 103, and that the 60-80
smelters subject to increased costs associated with activities 28b and 31b
are in turn a subset of the 100. The larger estimate of smelters subject
to increased costs (80) was used to provide a conservative estimate of net
cost savings. Thus, 80 smelters are affected for all three activities, an
additional 20 for two activities and only 3 for activity 23b.
-------
Exhibit IV-4
SUMMARY OF CHANGES IN COMPLIANCE COSTS
DUE TO PROPOSED CHANGES: "WORST CASE"
(annualized costs in thousands of 1981 dollars, after-tax)
Number of Affected Total Cost
Establishments Impact
Average Change
in Costs per
Establishment
Establishments with
Increased Requirements:
Newly Regulated
Increased Burden
42
200
$ 235
92
$ 5.6
0.5
Establishments with
Decreased Requirements:
Released from RCRA
Reduced Burden
76
299*
(3827)
(19,441)
(50.3)
(65.2)
*Excludes 4582 establishments for whom regulatory requirements decrease
but who are estimated to experience negligible cost savings as a
result.
-------
IMPACTS ON INDUSTRIES THAT WILL
EXPERIENCE INCREASED REODIREMENTS
CHAPTER 5
In order to determine whether the proposed changes in the
definition of solid waste and management standards for wastes
that are recycled will cause major increases in costs or prices
for any industry, or will otherwise have significant adverse
effects on competition, employment, and other economic factors,
this chapter considers impacts on those industries which will
experience increased requirements in more detail. The industries
facing increased requirements under the proposed changes include:
Paint & Allied Products
(42 establishments)
Solvent Reclaimers
(100-150 contract facilities)
Battery Crackers
(60-80 secondary lead smelters
and 20-50 independent battery
crackers)
Newly-regulated
Additional storage
facility requirements
Additional storage
facility requirements
IEc's analysis indicates that none of the affected
establishments will incur significant increases in costs, as
described below.
PAINT AND ALLIED PRODUCTS
The 42 establishments newly-regulated under the hazardous
waste management regulations will face approximately $5,600 in
additional costs (after-tax annualized) per establishment on the
5-1
-------
average. The additional costs are relatively low because the
establishments will be required to meet only requirements for
generators and for short-term storage under 40 CFR 262.34. These
costs represent 0.2 percent of the estimated 1981 value added per
establishment, and less than 0.1 percent of sales, for the paint
and allied products industry (SIC 2851).
The cost increases estimated in this analysis are likely to
be overstated. It was assumed that all paint and allied product
establishments sending non-listed solvents to off-site reclaimers
would be newly-regulated as a result of the proposed changes. In
factf many of the affected facilities may currently be subject to
the hazardous waste management regulations by virtue of handling
other hazardous wastes. If already regulated, these establish-
ments would experience only minor increases in costs as a result
of the proposed changes. IEc was not able to obtain reliable
estimates of the percentage of paint and allied product estab-
lishments that are currently regulated because they recycle non-
listed solvents off-site, however, and therefore it was assumed
conservatively that all such establishments would be newly-regu-
lated.
SOLVENT RECLAIMERS
An estimated 150 solvent reclaimers accepting non-listed
solvents for reclamation are assumed not to accept these wastes
under batch tolling agreements (see Appendix B.>. These estab-
lishments will be subject to increased regulatory requirements
under the proposed changes, but because they currently accept
listed solvents as well will not be newly-regulated. These
establishments will face minimal cost increases (an average of
$480 per establishment after-tax annualized). These costs are
negligible because these facilities are subject to increased
requirements for only a small additional volume of waste on the
average. If these establishments do in fact accept some of the
non-listed solvents under batch tolling agreements, cost in-
creases will be less than those estimated. Further, any of these
facilities also accepting listed solvents under batch tolling
agreements is likely to experience net savings.
BATTERY CRACKERS
Op to 80 secondary lead smelters who recover lead from spent
batteries will face increased regulatory requirements under the
proposed changes. However, these same facilities will experience
reduced requirements associated with on-site reclamation of lead
from emission control dusts and reclamation of lead from non-
listed sludges. As shown in Exhibit IV-3, these facilities
5-2
-------
experience an estimated net reduction in costs of $2,977 (after-
tax, annualized) per facility as a result of these changes.
Independent battery crackers are also subject to increased
requirements as a result of the proposed changes. As many as 50
establishments are estimated to incur approximately $342 in addi-
tional costs each if they store in waste piles, and $432 if they
store in containers (after-tax annualized costs). Representa-
tives of the trade association for independent battery crackers
informed IEc that most if not all of its members are currently in
compliance with the design standards of the hazardous waste
management regulations and thus would experience only moderate
increases in cost as a result of the proposed regulations. The
major concern expressed about the effects of the proposed changes
dealt with the potential impacts on independent battery crackers'
ability to compete for the supply of spent batteries with second-
ary lead smelters. This concern was based on a belief that those
supplying batteries would be required to comply with manifest
requirements as a result of the proposed changes. Since this is
not the case, it does not appear that the proposed.changes will
impose significant costs or otherwise affect the competitive
position of independent battery crackers adversely.
5-3
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APPENDIX A
PROPOSED DEFINITION OF SOLID WASTE
AND MANAGEMENT STANDARDS
FOR WASTES THAT ARE RECYCLED
-------
For the reasons set out in the preamble, it is proposed to
amend Title 40 of the Code of Federal Regulations as follows:
PART 260 - HAZARDOUS WASTE MANAGEMENT SYSTEM: GENERAL
1. The authority citation for Part 260 is as follows:
AUTHORITY: Sections 1006, 2002(a), 3001 through 3007, and 3010
of the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act, as amended [42 USC 6905, 6912(a),
6921 through 6927, and 6930].
2. Section 260.10 is amended by adding new definitions for
"Boiler" and "Industrial Furnace" to appear alphabetically
and by amending the definition of "Incinerator:"
§260.10 Definitions.
*****
"Boiler" means an enclosed device using controlled flame combustion
and having the following design characteristics:
(1) The unit has.provision for heat recovery; and
(2) The combustion chamber and heat recovery section are
of integral design. The combustion chamber and heat
recovery sections are of integral design if formed
physically into one manufactured or assembled unit.
(A unit in which the furnace or combustion chamber and
heat recovery section are joined by ducts or connections
carrying flue gas is not integrally designed); and
(3) Significant heat recovery takes place in the combustion
chamber section by radiant transfer of heat to the
transfer medium.
-------
"Incinerator1* means an enclosed device using controlled flame
combustion, and having a combustion chamber and heat recovery
section, if any, that are not of integral design.
"Industrial Furnace" means any of the following devices that are
integral components of manufacturing processes and use flame
combustion or elevated temperature to accomplish recovery of
materials or energy: cement kilns, lime kilns, aggregate kilns,
phosphate kilns, blast furnaces, smelting furnaces, methane
reforming furnaces, combustion devices used in the recovery of
sulfur values from spent sulfuric acid, and pulping liquor recovery
furnaces. The Administrator may decide to add devices to this
list on the basis of one or more of the following factors:
(1) The device is designed and used primarily to accomplish
recovery of material products;
(2) The device burns secondary materials as ingredients
in an industrial process to make a material product;
(3) The device burns secondary materials as effective
substitutes for raw materials in processes using raw
materials as principal feedstocks;
(4) The device burns raw materials to make a material product;
(5) The device is in caramon industrial use to produce a
material product; and
(6) Other factors, as appropriate.
-------
PART 261: IDENTIFICATION AND LISTING OF HAZARDOUS WASTES
3. The authority citation for Part 261 reads as follows:
Authority: Sections 1006, 2002(a), 3001, and 3002 of
the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976,. as amended [42 U.S.C.
6905, 6912(a), 6921, and 6922].
4. In S261.1, paragraph (b) is revised to read as follows:
§261.1 Purpose and scope.
*****
(b) (1) The definition of solid waste contained in this
Part applies only with respect to the regulations implementing
Subtitle C of RCRA.
(2) This Part identifies only some of the materials
which are solid wastes and hazardous wastes under Sections
3007, 3013, and 7003 of RCRA. A material which is not defined
as a solid waste in this Part, or is not a hazardous waste
identified or listed in this Part, is still a solid waste and
a hazardous waste for purposes of these sections if:
(i) In the case of Sections 3007 and 3013, EPA
has reason to believe that the material may be a solid waste
within the meaning of Section 1004(27) of RCRA and a hazardous
waste within the meaning of Section 1004(5) of RCRA; or
(ii) In the case of Section 7003, the statutory
elements are established.
-3-
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5. §261.2 is revised to read as follows:
§261.2 Definition of solid waste.
(a) A solid waste is any discarded material that is not
excluded by 5261.4(a). A "discarded material"
is any material that fits one of the descriptions
in paragraphs (a)(1) and (a)(2) of this section.
(1) Any garbage, refuse, sludge, or any other
solid, liquid, semi-solid, or contained
gaseous material resulting from industrial,
commercial, mining, or agricultural operations
or from community activities that is:
( L) Abandoned by being disposed of; or
(ii) Abandoned by being burned or incinerated;
or
liii) Accumulated, stored, or treated prior to--
or in lieu of — paragraphs (a)(1) (i) or
(ii) of this section.
(2) Any of the following materials, when used,
reused, or reclaimed in the following ways
or accumulated, stored, or treated prior thereto:
(i) Any spent material, sludge, or by-product,
or any material listed in $261.33 that is
not ordinarily used by being applied
to the land, that is used or reused
without essential change to its identity,
or after simple mixing, in a manner that
constitutes disposal;
4
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(ii) Any spent material or sludge, or any
by-product listed in §§261.31 or 261.32,
or any material listed in $261.33 that is
not itself a fuel, that is being burned
for the purpose of energy recovery, or
that is being used to produce a fuel, and
any fuel that contains one or more of
these materials;
(iii) Any spent material, any sludge listed
in §§261.31 or 261.32, or any by-product
listed in §§261.31 or 261.32, that is
reclaimed (as this activity is explained
in paragraph (c){i) of this section).
This provision does not apply, however,
to materials reclaimed at the plant
site and then reused within the original
process in which they were.generated;
(iv) Any spent material, sludge, or by-
product that is accumulated speculatively
(as thi's activity is explained in
paragraph (c)(2) of this section);
(v) Any spent material, sludge, or by-product
that is accumulated for use, reuse,
or reclamation without sufficient amounts
being used, reused, or reclaimed during a
one-year period (as this activity is
explained in paragraph (c)(3) of this
section);
-------
(3) Materials that meet the criteria stated in para-
graph (i) below, and that are listed in paragraph
(ii) are solid wastes when used or reused:
Ii)(A)(1) The materials are ordinarily disposed
of, burned or incinerated, or
(2) The materials contain toxic constit-
uents listed in Appendix VIII of Part
261 and these constituents are not ordi-
narily found in raw materials or products
for which the materials substitute
and are not used or reused during
the recycling process; and
(B) The materials may pose a substantial
hazard to human health and the environ-
ment when used or reused,
(ii) Hazardous Waste Nos. F020, P021, F022,
and F023.
id; for the purpose of this section:
(1) A "spent material" is any material that has
been used and has served its original purpose;
(2) "Sludge" has the same meaning used in
§260.10 of this chapter;
(3) A "by-product" is a material that is
not one of the primary products of a
production process and is not solely
or separately produced by the production
process.
(c) For the purposes of this section and §261.6:
-6-
-------
(1) A material is "reclaimed" if it is processed
to recover usable products, or if it is
regenerated. (Examples are recovery oC
lead values from spent batteries and
regeneration of spent solvents.) However, a
material that is used or reused in the
following ways is not considered to be
reclaimed:
(i) Used or reused as an ingredient
(including use as an intermediate)
in an industrial process to make a
product (for example, sludges used as
ingredients in cement production, or
distillation bottoms from one process
used as a feedstock in another process),
provided that distinct components of
the material are not recovered as
separate end products (as in recovery
of metals from metal-containing secondary
materials); or
(ii) Used or reused as effective substitutes
for raw materials in processes using
raw materials as principal feedstocks
(for example, sludges used as substitutes
for ore concentrate in primary smelting);
or
(iii) Used or reused in a particular function
7-
-------
or application as an effective substitute
for a commercial product (for example,
spent pickle liquor used as a phosphorous
precipitant and sludge conditioner in
wastewater treatment).
(2) A material is "accumulated speculatively" if
it is potentially usable, reusable, or
reclaimable but is held without having any
known market or disposition, or is held without
having any feasible means of use, reuse, or
reclamation. However, when a material that has
been accumulated speculatively- is removed from
accumulation for use, reuse, or reclamation, it
ijs no longer considered to be a solid wa.ste for
purposes of this paragraph.
(3) A material is "accumulated without sufficient
amounts being used, reused, or reclaimed" if —
during the calendar, fiscal, or inventory year
period — the amount of material that is used,
reused, reclaimed, or transferred to a different
site for use, reuse, or reclamation does not
equal at least 75 percent by volume of the
amount of that material accumulated at the
beginning o£ the period. However, paragraphs
(c)(3) (i) and (ii) of this section proyide
certain exceptions to this principle. (In
addition materials excluded from regulation
-8-
-------
under §261.6(b)(1)(vi) - (vii) are not to be
included in making this calculation.)
(1) Spent materials, sludges, or by-products
are not considered to be solid wastes
under this paragraph if after being
accumulated initially without sufficient
amounts being used, reused, or reclaimed,
they are removed from accumulation for use,
reuse, or reclamation.
(ii) (A) If a material accumulates Eor one
year without use, reuse, reclamation,
or transfer of at least 75 percent of
the accumulated volume, the Regional
Administrator may determine that the
accumulated material will not be a
solid waste during the following year.
To obtain this determination, the person
accumulating the material must notify
the Regional Administrator in writing,
submitting the following information:
(1^) The name and address of the person
* required to notify and the«address of
the location of the accumulated material,
if different.
(2) A description of: (1) the material
being accumulated, (2) why the
material would be a hazardous
9
-------
waste if deemed to be discarded
(i.e., whether it is listed or
exhibits a characteristic), (3)
the quantity accumulated at the
date of notification, and (4) the
'way the material is stored prior
to use, reuse, reclamation, or
transfer; and
(3) A statement of: (1) what the
notifier expects the disposition
(use, reuse, reclamation, or
transfer) of the material to be,
(2) why this expectation is
reasonable (for example, because
of past practice, market factors,
or contractual arrangements), (3)
why the material has accumulated
for over one year, and (4) when
the notifier expects the use,
reuse, reclamation, or transfer to
occur•
The Regional Administrator may
then use this information to determine
whether the material will not be a
solid waste during the following year,
or alternatively, may require further
pertinent information from the notifier.
-10-
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Such a determination will be based upon
the reasonableness of the notifier's
expectation that the material will be used,
reused, reclaimed, or transferred for these
purposes, taking into account: the past
practices, market factors, and contractual
arrangements; the character and quantity of
the material being accumulated; and the
manner in which the material is being
stored. The notifier must keep appropriate
records to demonstrate why he reasonably
expects the accumulated material to be
used, reused, reclaimed, or transferred
for these purposes.
(B) After the second year without use,
reuse, reclamation, or transfer of at
least 75 percent of the total volume accumu-
lated at the beginning of that year, the
Regional Adminstrator may again determine
that the accumulated material will not
be a solid waste during the following
year. To do this, he must receive in
writing the same information set out in
paragraph (c)(3)(ii)(A) of this section
from the person accumulating the material;
and at least 50 percent of the total
volume accumulated at the beginning of the
-11-
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year must have been used, reused, reclaimed,
or transferred.
(C) If the material accumulates for a
third year without use, reuse, reclamation,
or transfer of at least 75 percent of
the total volume accumulated at the
beginning of that year, all material not
actually used, reused, reclaimed, or
transferred is a solid waste,
(d) Respondents in actions to enforce regulations
implementing Subtitle C of RCRA who raise a claim
that a certain material is not a solid waste, or
is exempt from regulation, must demonstrate that
there is a known market or disposition for the
material, and that they meet the terms of the
exclusion or exemption. In doing so, they must
provide appropriate documentation (such as contracts
showing that a second person uses the material as
an ingredient in a production process) to demonstrate
that the material is not a waste, or is exempt
from regulation. In addition, owners or operators
'of facilities claiming that they are actually
using, reusing, or reclaiming materials must show
that they have the necessary equipment to do so.
12
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6. Section 261.3 is amended by revising paragraph (c)(2) to
read as follows:
§261.3 Definition of hazardous waste.
* * * * *
(c) * + *
(2) Any solid waste generated from the treatment,
storage, or disposal of a hazardous waste, including any
sludge, spill residue, ash, emission control dust, or leachate
(but not including precipitation run-off), is a hazardous
waste. (However, materials that are reclaimed from solid
wastes and that are used beneficially are not solid wastes
K
and hence are not hazardous wastes under this provision.)
*****
-13-
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7. Section 261,5 is amended by revising paragraph (c) to
read as follows:
S261.5 Special requirements for hazardous waste generated by
small quantity generators,
* * * * *
(c) Hazardous waste that is used* reused, or reclaimed and
that is excluded from regulation under §§261.6(b) and 261.6(e)(3)
is not included in the quantity determinations of this section, and
is not subject to any requirements of this section. Hazardous
waste that is subject to the special requirements of §§261.6(c)
and (d), and 261.6(e)(1) and (2) is included in the quantity
determinations of this section and is subject to the requirements
of this section.
it ~ * # #
14
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8. Section 261.6 is revised to read as £ollows:
S261.6 Special requirements for regulated recyclable materials.
(a) Hazardous wastes that are used, reused, or reclaimed will
be known as 'regulated recyclable materials.'
(b)(1) The following regulated recyclable materials are not
subject to regulation under Parts 262 through 266 or Parts
122 through 124 of this Chapter and are not subject to the
notification requirements of Section 3010 of RCRA:
(i) Regulated recyclable materials that are re-
claimed by the person generating them, provided
that sufficient amounts of materials are
reclaimed during a one-year"period (as defined
in 5261.2(c)(3)). This exemption does not
apply, however, when the regulated recyclable
materials are stored in a surface impoundment
prior to reclamation, or are reclaimed or
otherwise processed in a surface impoundment.
This exemption also does not apply to spent lead-
acid batteries being reclaimed.
(ii) Regulated recyclable materials that are re-
claimed by a person who subsequently uses the
W*
reclaimed material in own operation,
provided that sufficient amounts of materials
are reclaimed during a one-year period (as
defined in §261.2(c)(3)). This exemption
does not apply, however, when the regulated recycl-
able materials are stored in a surface impoundment
-15
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prior to reclamation, or are reclaimed or other-
wise processed in a surface impoundment.
This exemption also does not apply to spent
lead-acid batteries being reclaimed,
(iii) Regulated recyclable materials utilized for
precious metal recovery, provided that sufficient
amounts of materials are reclaimed during a one-
year period (as described in 5261.2(c)(3)).
(iv) Regulated recyclable materials reclaimed
pursuant to batch tolling agreements. For
purposes of this paragraph, a "batch tolling
agreement" is a contractual arrangement
pursuant to which the person generating the
material retains ownershiD of the material*,
possession of the material is transferred
within 180 days of generation to a reclaimer
who reclaims that material and returns the
reclaimed portion to the owner, reclamation
and return of the reclaimed materials is
completed within 90 days, the material is
not commingled with that of any other person
prior to or while being reclaimed, the reclaimer
is paid according to the amount of reclaimed
material returned to the owner, and the
reclaimer is paid more as the amount of
reclaimed material returned to the owner
increases.
16
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(v) Regulated recyclable materials (including
any fuel produced from one or more of these
materials) burned for energy recovery in an
industrial furnace or in a boiler that is not
regulated under Subpart 0 of Part 264 of this
chapter. ("Industrial furnace" and "boiler"
are defined in §260.10 of this chapter.)
This exemption does not apply when any of these
materials are accumulated, treated, or stored
prior to being used to produce fuels by a
person who did not generate them and who is
not using the fuel in its own operation, or when
regulated recyclable materials that are sludges
or are listed as hazardous wastes in §§261.31 or
261.32 of this chapter are accumulated, treated,
or stored prior to burning as a fuel or prior to
use to produce a fuel. This exemption also
does not apply when these materials are accumulated
prior to burning as a fuel or prior to use to
produce a fuel without sufficient amounts being
used during a one-year period (as defined in
in 5261.2(c)(3)).
(vi) Used oil that exhibits one or more of the
characteristics of hazardous waste identified
in Subpart C of Part 261.
(vii) Used batteries returned to a battery manufacturer
for regeneration (a used battery can be "regenera-
ted" by addition of electrolyte, replacement
of defective cells, or other minor processing).
-17
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(2) The Regional Administrator may decide on a case-
by-case basis that persons accumulating, storing, or burning
the regulated recyclable materials described in paragraphs
(b){1)(i)-(v) of this section should be subject to regula-
tion under otherwise applicable provisions o£ this section
or Subpart O of Part 264 of this chapter. The standard and
procedures for this decision are set forth in paragraph (g)
of this section.
(c) Generators and transporters of regulated recyclable
materials are subject to the following requirements, unless
the materials are regulated under Subparts C or D of Part
266 of this chapter, or exempted under paragraph (b)(1) of
this section:
(1) Generators: Part 262 of this Chapterr
T2) Transporters: Part 263 of this Chapter.
(d) Owners or operators of facilities that store regulated
recyclable materials are subject to the following requirements,
unless regulated under Subparts C or 0 of Part 266 of this
Chapter, or exempted under paragraph (b)(1) of this section:
(1) Notification requirements under Section 3010 of
RCRA;
(2) All applicable provisions in Subparts A through L
of Part 264 of this chapter;
(3) All applicable provisions in Subparts A through L
of Part 265 of this chapter;
(4) All applicable provisions in Parts 122 and 124 of
this chapter.
(e) Owners or operators of a facility that uses regulated
-------
i.
-------
(1) The materials accumulated or stored by the person,
and the amounts accumulated or stored;
(ii) The method of accumulation or storage;
(iii) The length of time the materials have been
accumulated or stored prior to being reclaimed;
(iv) Whether any contaminants are being released into
the environment, or are likely to be so released; and
(v) Other relevant factors.
(2) The Regional Administrator may also decide on a case-
by-case basis that persons who are burning regulated recyclable
materials as fuels in boilers or in industrial furnaces are
subject to regulation under Subpart 0 of Part 264 of this
chapter. The basis for this decision is that the materials
are being burned in a manner that is insufficient to pfocect
human health and the environment based upon the quantity and
toxicity of the stack emissions. In making this decision,
the Regional Administrator will consider the following factors:
(i) The content and mass of the input;
(ii) The conditions under which the unit is operated;
(iii) The potential for stack emissions to pose a
hazard to human health and the environment; and
(iv) Other relevant factors.
(3) The following procedures will be used in making the
determination set forth in paragraphs (g)(1) and (g)(2) of this
section.
(i) The Regional Administrator will issue a notice
setting, forth the factual basis for the decision. If the
20-
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person is accumulating the regulated recyclable material as
a generator, the notice will state that the person must
comply with the applicable requirements of Part 262 of this
chapter. .The notice will become final within 30 days unless
the person served requests a public hearing to challenge the
decision. Upon such request, the Regional Administrator
will hold a public hearing, and after the conclusion of the
hearing, will issue an appropriate final order. This final
order may be appealed to the Administrator.
(ii) If the person is accumulating the regulated recy-
clable material as a storage facility or burning the material
in a unit subject to regulation under Subpart 0 of Part 264
of this chapter, the notice will state further that the
person must obtain a permit in accordance with all applicable
provisions of Parts 122 and 124 of this chapter. The owner
or operator of the facility must apply for a permit within
60 days of notice. If the owner or operator of the facility
wishes to challenge the Regional Administrator's decision,
he can do so in his permit application, or in a public hearing
held on the draft permit. The question of whether the Regional
Administrator's decision was proper will remain open for
consideration during the public comment period under S124.ll
of this chapter and in any subsequent hearing.
21
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9. Section 261.31 is amended by revising the hazardous waste
listings F007, F008f F009, F010, F011, and F012 to read as follows:
§261.31 Hazardous waste from non-specific sources.
Industry
Generic
EPA Hazardous
Waste No.
F007
F008
F009
F010
F011
FQ12
Hazardous Waste
Spent cyanide plating
bath solutions from
electroplating
operations
Plating bath sludges
from the bottom of
plating baths from
electroplating oper-
ations where cyanides
are used in the process
Spent stripping and
cleaning bath solutions
from electroplating
operations where
cyanides are used in
the process
Quenching bath sludges
from oil baths from
metal heat treating
operations where cyanides
are used in the process
Spent cyanide solutions
from salt bath pot
cleaning from metal
heat treating operations
Quenching wastewater
treatment sludges from
metal heat treating
operations where cyanides
are used in the process
Hazard
Code
-------
10. Section 261.33 is amended by revising, the first clause to
read as follows:
S261.33 Discarded commercial chemical products, off"
specification species, container residues/ and spill
residues thereof.
The following materials or items are hazardous wastes when
they are discarded or intended to be discarded in a manner
described in $261.2(a)(1), when they are burned for purposes of
energy recovery in lieu of their original intended use, when
they are used to produce fuels in lieu of their original intended
use, and when they are applied to the land in lieu of their
original intended use:
*****
-23
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PART 264 - STANDARDS FOR OWNERS AND OPERATORS OF HAZARDOUS
WASTE TREATMENT, STORAGE, AND DISPOSAL FACILITIES
11. The authority citation for Part 264 reads as follows:
Authority: Sees. 1006, 2002(a), 3004,. and 3005 of the Solid
Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act of 1976, as amended [42 U.S.C. 6905, 6912(a),
6924, and 6925].
12. In 5264.1, paragraph (g)(2) is revised to read as follows:
§264.1 Purpose, scope, and applicability.
*****
(g) * * *
(2) The owner or operator of a facility managing regu-
lated recyclable materials described in SS261.6(b) or 261.6(f)
of this chapter (except to the-extent that.requirements .of
this Part are referred to in Subparts C or D of Part 26 6
of this chapter).
*****
24
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PART 265 - INTERIM STATUS STANDARDS FOR OWNERS AND OPERATORS
OF HAZARDOUS WASTE TREATMENT, STORAGE, AND DISPOSAL FACILITIES
13. The authority citation for Part 265 reads as follows:
Authority: Sees 1006, 2002(a), 3004, and 3005 of the Solid
Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act of 1976, as amended [42 U.S.C. 6905,
6912(a), 6924, and 6925].
14. In §265.1, paragraph (c)(6) is revised to read as follows:
§265.1 Purpose, scope, and applicability.
,*****
(c) * * *
(6) The owner or operator of a facility managing regulated
recyclable materials described in §§261.6(b) or 261.6(f) of
this chapter (except to the extent that requirements of this
Part are referred to in Subparts C or D of Part 266 of this
chapter).
-------
PART 266 - STANDARDS FOR THE MANAGEMENT OF SPECIFIC HAZARDOUS
WASTES AND SPECIFIC TYPES OF HAZARDOUS WASTE MANAGEMENT
FACILITIES
15. The authority citation for Part 266 reads as follows:
Authority: Sees. 1006, 2002(a)r and 3004 of the Solid Waste
Disposal Act, as amended by the Resource Conservation and Recovery
Act of 1976, as amended [42 U.S.C. 6905, 6912(a), and 6924].
16. In Part 266, Subparts C and D are added to read as
follows:
*****
Subpart C - Regulated Recyclable Materials Reclaimed Pursuant
to Non-Batch Tolling Agreements
§266.20 Applicability and reguirements.
(a) The regulations of this Subpart apply to generators
and transporters of regulated recyclable materials being
reclaimed pursuant to non batch tolling agreements, and to
owners or operators of facilities that store regulated recy-
clable materials pursuant to non-batch tolling agreements.
For purposes of this Subpart, a "non batch tolling agreement"
is a contractual arrangement pursuant to'which the person
generating the regulated recyclable material transfers the
material to a reclaimer who returns reclaimed material to
the person generating the material.
(b) Generators and transporters of regulated recyclable
materials reclaimed pursuant to non batch tolling agreements
are subject to the following reguirements:
-26-
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(1) Generators: Subparts A, C, D, and E of Part 262
of this chapter.
(2) Transporters: Subparts A and C of Part 263 of
this chapter.
(c) Owners or operators of facilities that store regulated
recyclable materials being reclaimed pursuant to non-batch
tolling agreements are subject to the following requirements:
(1) Notification requirements under Section 3010 of
RCRA;
(2) All applicable provisions in Subparts A, B (but not
§264.13 (waste analysis)), C, D, E (but not §§264.71 and 264.72
(dealing with use of the manifest and manifest discrepancies)),
and P through L of Part 264 of this chapter;
(3) All applicable provisions in Subparts A, 3 (out
not §265.13 (waste analysis)),-C, D, E (but not §§265.71 and
265.72 (dealing with use of the manifest and manifest
discrepancies)), and F through L of Part 265 of this chapter;
(4) All applicable provisions in Parts 122 and
124 of this chapter.
-27-
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Subpart D - Spent Lead-Acid Batteries Being Reclaimed
§266.30 Applicability and requirements.
(a) The regulations of this Subpart apply to persons who
reclaim spent lead-acid batteries that are regulated recyclable
materials ("spent batteries"). Persons who generate, transport,
or collect spent batteries, or who store spent batteries but
do not reclaim them are not subject to regulation under
Parts 262 - 266 or Parts 122 - 124 of this chapter, and also
are not subject to the requirements of Section 3010 of RCRA.
(b) Owners or operators of facilities that store
spent batteries prior to reclaiming them are subject to the
following requirements:
(1) Notification requirements under Section 3010 of
RCRA;
(2) All applicable provisions in Subparts A, B (but not
§264.13 (waste analysis)), C, D, E (but not §§264.71 or 264.72
(dealing with the use of the manifest and manifest discrepancies)
and P through L of Part 264 of this chapter;
(3) All applicable provisions in Subparts A, B (but not
§265.13 (waste analysis)), C, D, E (but not §§265.71 and 265.72^
(dealing with use of the manifest and manifest discrepancies)),
and F through L of Part 265 of this chapter;
(4) All applicable provisions in Parts 122 and 124
of this chapter.
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ADJUSTMENTS TO ESTIMATES OF NUMBER
Of AFFECTED ESTABLISHMENTS
APPENDIX B
INTRODUCTION
JRB's analysis of the number of affected establishments
primarily considered changes in the definition of solid waste in
combination with certain exemptions. In considering other exemp-
tions (not evaluated by JRB as part of their analysis), IEc
determined that fewer establishments are affected than predicted
by JRB. It was therefore necessary to adjust JRB's estimates of
the number of affected establishments to reflect these changes.
This appendix discusses the adjustments made by IEc.
EXEMPTION FOR BATCH TOLLING
Under the proposed regulations, off-site recycling of non-
listed hazardous wastes will be regulated for the first time.
EPA has decided to exclude from regulation materials recycled
under batch tolling arrangements. The following industries are
potentially affected by this change.
Solvent Reclaimers
JRB had estimated that 150-200 solvent reclaimers accept
solvents for reclamation. IEc estimated that these facilities
accept approximately 2,870 MT/year of listed and non-listed sol-
vents. An official of the National Association of Solvent
Recyclers (NASR) provided preliminary results of a survey that
indicate that approximately 80 percent of NASR members' business
is handled under tolling arrangements. The official stated that
B-l
-------
if tolling arrangements were used, they were likely to be batch
tolling arrangements in all cases. The survey also shows that
none of the respondents operate solely under tolling arrangements
and the NASR official stated that virtually all facilities accept
both listed and non-listed solvents. IEc assumed that approxi-
mately 10 percent of the solvents accepted are non-listed (287
MT/year per facility) and 90 percent are listed (2,580 MT/year
per facility). Further, it was assumed that on average 80 per-
cent of both listed and non-listed solvents are accepted under
batch tolling agreements. Therefore, the net reduction in the
volume of regulated wastes per facility is calculated as follows:
Decrease in Average (2,064) (2,580 x 80%)
Regulated Volume
(listed wastes under batch
tolling agreement)
Increase in Average 57 ( 287 x 20%)
Regulated Volume
(non-listed wastes not
under batch tolling
agreements)
Net Decrease in Regulated (2,007)
Volume
This estimate was applied only for 50 establishments (the
approximate membership of NASR). The NASR survey covered only a
small number of facilities and cannot be assumed to be repre-
sentative of non-member facilities. Therefore, to provide a
conservative estimate of cost impacts, it is assumed that the
remaining 100-150 solvent reclaimers do not use batch tolling
agreements. These facilities would therefore be subject to a net
increase in the regulated volume of wastes of 287 MT/year (aver-
age volume of non-listed solvents, of which none is assumed to be
accepted under batch tolling agreements).
Paint and'Allied Products
Paint and allied product producers sending spent solvents to
off-site reclaimers under batch tolling agreements will also be
exempt from regulation under the proposed rules. Producers send-
ing listed solvents to off-site under non-batch tolling agree-
ments will be subject to reduced requirements, while those send-
ing non-listed solvents off-site other than under tolling agree-
ments will be subject to increased requirements. JRB did not
provide an estimate of the number of establishments currently
B-2
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regulated which would be subject to requirements for additional
volumes/ but did estimate that 56 establishments would be newly-
regulated. Only these 56 establishments were therefore con-
sidered in this cost impact analysis. To be consistent/ IEc did
not calculate cost savings for paint and allied product estab-
lishments with reduced requirements associated with off-site
batch tolling of listed solvents. Further, it was assumed that
no establishments would be released from RCRA completely as a
result of the batch tolling exemption. Thus, only the establish-
ments potentially regulated for the first time were considered in
this analysis. The results therefore substantially understate
the savings resulting from the proposed changes for this
industry.
As noted above, up to 80 percent of solvents received by
some off-site reclaimers are accepted under batch tolling agree-
ments. According to an official of NASR, it is unlikely that as
much as 80 percent of paint solvents are handled under batch
tolling arrangements, however. Batch tolling is economically
feasible only above a minimum volume level, and many paint
producers may generate too little solvent to justify batch
tolling. IEc was not able to determine how many of the
potentially-affected paint producers are large enough to send
non-listed solvents to off-site reclaimers but too small to use
batch tolling agreements. In the absence of reliable informa-
tion, it was assumed conservatively that only 25 percent of the
potentially-affected establishments would be exempted from
regulatory requirements by virtue of batch tolling. It was
further assumed that any paint producer using off-site solvent
reclamation services will send all of their spent solvents to
that off-site facility. Therefore, the number of establishments
estimated to send non-listed solvents to off-site facilities (56)
was reduced by 25 percent (to 42); but no adjustment was made to
the average volume of waste affected for the remaining 42 estab-
lishments.
Carbon Reclaimers
Six carbon reclaimers accepting spent carbon for regenera-
tion were identified by JRB. Three establishments were known to
be regulated under the hazardous waste management regulations
already. The other three establishments were initially assumed
to be newly-regulated as a result of the proposed change. Fur-
ther investigation by IEc revealed that one of the three estab-
lishments does not currently accept spent carbon they believe to
be hazardous. The other two establishments are likely to handle
all carbon under batch tolling agreements given the proposed
regulatory changes. One of the two establishments currently
handles approximately 98 percent of the spent carbon it handles
B-3
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under batch-tolling agreements; It is assumed that this one
establishment will no longer accept the remaining two percent to
avoid being newly-regulated. The remaining establishment is
exempt because all of its regeneration of carbon is currently
conducted under batch tolling agreements.
B-4
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ADJUSTMENTS TO DNIT COSTS
APPENDIX C
A number of adjustments were made to the cost data obtained
from various sources. First, all cost data were adjusted to 1981
dollars, using the inflation indices shown in Exhibit C-l. In
addition, costs were classified (1) by whether they are variable
with the volume or number of wastes handled or fixed with respect
to volume, and (2) by whether costs have already been incurred,
(that is, are "sunk" costs) and hence would not be affected by
the proposed changes. It was assumed that all affected estab-
lishments (except those which would be newly-regulated) are
currently in compliance with all Interim Status requirements. It
was also assumed that the regulated establishments have not yet
incurred the incremental costs required to meet Final Status
Standards under 40 CFR 264. Exhibit C-2 identifies the unit cost
categories applied for different types of changes in regulatory
requirements.
In some cases, it was also necessary to translate the costs
into cost functions appropriate for this analysis—for example,
to translate costs expressed as a function of the number of tanks
at a facility to costs expressed as a function of volume. The
capacity factors used in these adjustments are shown in Exhibit
C-3. For one-time expenditures which vary with the volume of
waste, costs are expressed as a function of total facility life-
time capacity (assumed to be 20 years times annual capacity).
Finally, in some cases it was necessary to make assumptions about
how establishments would choose to comply with the hazardous
waste management regulations or about how many establishments
would have to undertake specific activities. All assumptions and
adjustments are described in the notes to the tables providing
costs for the specific requirements.
C-l
-------
The unit costs for each requirement were translated to
after-tax annualized costs, assuming a 20 year site life, (so
that closure costs are incurred in year 20 and all one-time
expenditures are annualized over 20 years) and a 3 percent real
rate of return after-tax. The analysis assumed a marginal tax
rate of 50 percent,!/ depreciation of property and equipment over
5 years, and a 10 percent investment tax credit.
1/Includes federal income taxes and state and local taxes.
C-2
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Exhibit C -1
INFLATION INDICES
M&S Equipment
Cost Index-'-
CE Plant
Cost Index^
Labor Rates2
Supervisory Technical Clerical
1979
1980
1981
599.4
659.6
721.3
238.7
261.2
308.4
(October)
27.50
39.80
29.00
37.60
9.00
13.25
^"Source: Chemical Engineering.
2
Source: JRB, Macro Profile: Cost Factors for Storage Facilities,
March 1982, p. 5-2 (for 1981) and ADL, Economic Impact
Analysis of RCRA Interim Status Standards, November 1981.
Vol. 2 Appendix B, p. B-2 (for 1979).
-------
Exhibit C-2
UNIT COST CATEGORIES APPLIED FOR DIFFERENT
CHANGES IN REGULATORY REQUIREMENTS
Newly- Increased Decreased Released from
Regulated Requirements Requirements Requirements
Initial Costs
Variable
Fixed: ISS x
Incremental FSS x
Annual Costs
Variable x x
Fixed: ISS x x
Incremental FSS x x
Closure Costs
Variable x x x x
Fixed x x
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Exhibit C-3
CAPACITY CONVERSION FACTORS
FOR TANKS AND CONTAINERS
Tanks
Size of Tanks Annual Capacity
(gals) (metric tons)
range mid-point
10,000 0-2000 1000
30,000 2001-5500 3750
50,000 5501-20,000 12,750
Source: Arthur D. Little, Inc., Economic Impact Analysis
of RCRA Interim Status Standards, November 1981,
and OSW personnel.
Containers
No. of Containers
per Facility
Annual
Capacity1
(gals)
Annual
Capacity^
(MT)
50
33,000
150
100
66,000
300
200
132,000
600
500
330,000
1500
Assuming 30 day turnover and 55 gallons/container capacity.
2
Assuming 10 lbs/gal conversion factor; gals t 220 = MT.
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