Costs for Traditional Air Pollutants

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1 Costs for Traditional Air Pollutants Presentation to IIASA Workshop in Austria Larry Sorrels, US EPA/OAR/OAQPS February 11, 2015

2 Purpose of this briefing 2 Discussion of Costs for Control Measures for Traditional Air Pollutants Focus of this Briefing is on Costs of Control Measures for NOx and SO2 Emission Reductions as Estimated by US EPA, since NOx is a major precursor to ozone concentrations, either locally or via transport. SO2 is a major precursor to PM2.5 concentrations via transport.

3 Cost Estimates for NOx and SO2 Control Measures 3 US EPA Estimates for NOx Control Measures are available for broadly defined sectors. These sectors are: Point sources: Electric power plants, and industrial sources Mobile sources (automobiles, trucks, whether onroad or offroad) These estimates are usually prepared to support analyses of rulemakings or regulatory programs. Review and update of cost estimates and related control measure data occurs periodically, but usually occur to support analysis of rulemakings or regulatory programs.

4 Sources of Point Source NOx and SO2 control measure costs Elec. Power Plants 4 For electric power plants, data within the IPM (Integrated Planning Model. IPM is used by US EPA s Office of Atmospheric Programs (OAP) and is a peerreviewed least-cost dispatch model applied for analysis of control strategies to reduce Nox, SO2, Hg, PM and CO2 from electric power plants. IPM was used for the Clean Power Plan the CO2 power plant standard proposed by EPA in June, Cost data for current IPM version (v5.13) was prepared by engineering firm Sergant & Lundy. Vintage of data for NOx and SO2: Cost data for NOx and SO2 control measures can be found at Main control technologies for NOx in IPM: SNCR, SCR (post-combustion), LNB (combustion) and NGR. Main control technologies for SO2 in IPM: wet FGD scrubbers, lime spray dryer, LSFO scrubbers.

5 Particulars on NOx and SO2 5 control measures in IPM Costs in IPM for NOx and SO2 are estimated using equations having unit size and capacity factor as variables. Equations differ by fuel type of affected unit (coal, gas, oil). Capital, and operating and maintenance O&M) costs both estimated. Percent reduction estimated for NOx control technologies in IPM: SNCR 35-50%, SCR 90%, LNB 12-58%, NGR 50%. Percent reduction estimated for SO2 control technologies in IPM: wet FGD scrubbers 90%, lime spray dryer 95%, LSFO 90%

6 6 Sources of Point Source NOx and SO2 control measure costs Industrial Plants For industrial plants, data is within CoST (Control Strategy Tool). CoST is used by US EPA s Office of Air Quality Planning and Standards (OAQPS) to estimate the cost and emission reductions for control strategies applied to reduce NOx, SO2, PM, and VOC. It is a peer reviewed model that can estimate emission reductions from an inventory at least cost. Control measure data within CoST was collected from US EPA technical reports, reports from States and Regional organizations (e.g., NESCAUM, OTC). Inclusion of control measures in CoST determined by OAQPS. Data within CoST is presented in a technical document found at Main control technologies for NOx in CoST SNCR, SCR (post-combustion), LNB (combustion), Steam Injection, Water Injection. Main control technologies for SO2 in CoST wet FGD scrubbers, dual absorption, amine scrubbing.

7 7 Particulars on NOx and SO2 control measures in CoST Costs for industrial source in CoST are estimated using equations having unit sizes and capacity factor as variables, or annualized cost/ton reduction if an equation is not available. Both capital and O&M costs are estimated. Percent reduction estimated for NOx control technologies in CoST: SNCR 40-55%, SCR 80-90%, LNB 50-84%, Steam Injection - 80%, Water Injection 68-76%. Percent reduction estimated for SO2 control technologies in CoST: wet FGD 90%, dual absorption 99%, amine scrubbing 97-98%. Note: There are very few NOx and SO2 control measures for nonpoint (area) source emissions thesewill not discuss them here.

8 Sources of Mobile Sources NOx 8 and SO2 control measure costs Costs for mobile sources prepared by US EPA are developed by contractors for OTAQ (Office of Transportation and Air Quality), and data provided by the automotive industry in the course of rulemakings. Much of this data is included in MOVES, an EPA used to estimate emissions changes due to control strategies to reduce mobile source emissions. NOx control measures for mobile sources include SCR (new installation and optimizing existing device), NSCR, catalyst loading and optimization. SO2 control measures for mobile sources include primarily low sulfur fuels (note: NOx reductions can occur from switch to lower sulfur fuels).

9 Particulars on NOx and SO2 9 mobile source control measures Costs for mobile sources are estimated based on the engine or vehicle class affected, and test data developed by or provided by auto industry or independent organizations to the US EPA. Percent reduction estimated for NOx control measures can vary from 5-23% (using final Tier 3 onroad standard issued in 2014 for diesel vehicles phased in from model year 2017 to 2023). Percent reduction estimated for SO2 control measures can be up to 56% (using final Tier 3 low sulfur fuel standard).

10 10 On Future Year Cost Estimates EPA often prepare costs for a future year in support of rulemakings. Projections can vary by type of regulation or program. For example, costs for existing source air toxics regulations are typically estimated for the 3 rd year after final rule issued; 5 th year for new source regulations, and longer periods for ambient criteria pollutant standards. EPA uses methodologies that estimate costs over the lifetime of control equipment. Costs are uniform, with the capital investment annualized over the equipment lifetime. The methodology is the Equivalent Uniform Annual Cost (EUAC) method for industrial sources, and the levelized cost method for power plants. The EUAC provides inflation-adjusted estimates, the levelized cost method incorporates tax and accounting conventions not considered in the EUAC. Thus, the costs of point source control measures will be the same for each year except for escalation of fuel and other prices (true for power plant control measures). For mobile source measures, learning by doing effects are incorporated. This yields lower costs, depending the model year and pace of learning by doing. Discussion of EPA point source control cost methodologies and other information on control technology cost and performance can be found in the EPA Air Pollution Control Cost Manual found at Examples of EPA cost estimates can be found within the Regulatory Impact Analyses (RIAs) found at

11 Questions? 11 You may contact me at or by phone at Thank you.

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