HomeMy WebLinkAbout6.e. Generator Upgrades4ROSEMOUNTEXECUTIVE SUMMARY
CITY COUNCIL
Utility Commission Meeting: March 11, 2013
ISSUE
RICE NESHAP is the acronym for the EPA rule for Reciprocating Internal Combustion Engines
National Emission Standards for Hazardous Air Pollutants. The RICE NESHAP rule requires
implementation of new maintenance and reporting practices for certain stationary diesel engines. Many
of these engines also require retrofit with catalytic emission control.
The city operates three generators that currently fall under the regulation of this new rule and may need
to be upgraded in the near future. Staff is in the process of researching this issue to determine what, if
any, corrective actions must be taken as a result of the new regulations.
BACKGROUND
Three of our backup generators are currently enrolled in the Xcel Energy Electric Rate Savings (ERS)
peak demand program. By participating in the ERS program and switching to standby power during
periods of peak electrical demand, we receive substantially lower usage rates from Xcel Energy,
providing a savings of approximately $13,720 annually.
To continue in the ERS program, components on these three generators would likely need to be
upgraded to be NESHAP compliant by May 2014. The estimated cost of these upgrades is provided in
Table 1.
Table 1
AGENDA SECTION:
AGENDA ITEM: Generator Upgrades
New Business
PREPARED BY: Andrew J. Brotzler, PE, Director of
AGENDA NO.
Public Works / City Engineer
Well 9 - stationary
ATTACHMENTS: Information Sheets
APPROVED BY:
RECOMMENDED ACTION: Discussion
ISSUE
RICE NESHAP is the acronym for the EPA rule for Reciprocating Internal Combustion Engines
National Emission Standards for Hazardous Air Pollutants. The RICE NESHAP rule requires
implementation of new maintenance and reporting practices for certain stationary diesel engines. Many
of these engines also require retrofit with catalytic emission control.
The city operates three generators that currently fall under the regulation of this new rule and may need
to be upgraded in the near future. Staff is in the process of researching this issue to determine what, if
any, corrective actions must be taken as a result of the new regulations.
BACKGROUND
Three of our backup generators are currently enrolled in the Xcel Energy Electric Rate Savings (ERS)
peak demand program. By participating in the ERS program and switching to standby power during
periods of peak electrical demand, we receive substantially lower usage rates from Xcel Energy,
providing a savings of approximately $13,720 annually.
To continue in the ERS program, components on these three generators would likely need to be
upgraded to be NESHAP compliant by May 2014. The estimated cost of these upgrades is provided in
Table 1.
Table 1
Description
Asset
Estimated Cost
Well 7 - portable
8059
$30,000
Well 9 - stationary
0053
$45,000
Well 12 - stationary
0060
$45,000
Total Estimated Cost
$120,000
In addition to the upgrade costs, there would be an additional cost of approximately $15,000 every
three years to have the equipment inspected to ensure it remains NESHAP compliant.
GAUTILITY COMMISSION= Information \20130311 UC Generator Upgrades V2.docx
Staff has also explored the possibility of withdrawing from the Xcel Energy ERS program It is our
understanding that by doing so, the three generators would then be considered exclusively emergency
units and would no longer be held to the regulations of RICE NESHAP; no equipment upgrades
would be immediately necessary. The drawback to this option is that the City would incur an additional
$14,000 annually in electrical charges by not participating in the ERS program. There is a potential for
an additional cancellation fee from Xcel Energy, as well.
SUMMARY
Staff will continue to gather more information about the RICE NESHAP rule and its impact on City
equipment. Staff is planning to discuss these and other possible options with an outside electrical
specialist in the coming weeks. An update will be provided to the Utility Commission during the April
2013 meeting.
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January 15, 2013
FACT SHEET
FINAL AMENDMENTS TO THE EMISSION STANDARDS FOR RECIPROCATING
INTERNAL COMBUSTION ENGINES
ACTION
• On January 14, 2013, the Environmental Protection Agency finalized amendments to the
National Emissions Standards for Hazardous Air Pollutants (NESHAP) for stationary
reciprocating internal combustion engines (RICE).
• In this rulemaking, EPA addressed several petitions for reconsideration, legal challenges
and new technical information submitted by stakeholders, including industry and
environmental groups, which were brought to the EPA's attention after publication of the
2010 standards.
• The final amendments will ensure that the standards are cost effective, achievable and
protective.
• The final revisions will reduce the capital and annual costs of the original 2010 rules by
$287 million and $139 million, respectively, while still reducing 2,800 tons per year (tpy)
of hazardous air pollutants (HAP); 36,000 tpy of carbon monoxide; 2,800 tpy of
particulate matter; 9,600 tpy of nitrogen oxides, and 36,000 tpy of volatile organic
compounds.
• Pollutants emitted from diesel engines are known or suspected of causing cancer and
other serious health effects including:
• Aggravation of respiratory and cardiovascular disease
• Changes in lung unction and increased respiratory symptoms
• Premature death in people with heart or lung disease
• Neurological, cardiovascular, liver, kidney health effects, and also effects on
immune and reproductive systems.
• Stationary engines generate electricity and power equipment at industrial, agricultural, oil
and gas production, power generation and other facilities. EPA estimates there are over 1
million of these engines in the U.S., and this rule will apply to some of these engines.
The final amendments generally apply to the following:
• engines typically used in sparsely populated areas for oil and gas production
• engines in remote areas of Alaska
• engines scheduled to be replaced in the next few years due to state or local
requirements, and certain engines installed in 2006
• engine testing requirements for formaldehyde emissions
• engines for offshore vessels operating on the Outer Continental Shelf
• engines used in emergency demand response programs
• Cl engines are compression ignition engines that use diesel fuels. SI engines are spark
ignition engines that use mainly natural gas and gasoline fuels.
• EPA is also revising the new source performance standards (NSPS) for stationary internal
combustion engines (ICE) to ensure consistency with the RICE NESHAP. In particular,
specifying how the NSPS standard will apply to emergency engines used for demand
response purposes.
AMENDMENTS
Area Source Stationary Spark Ignition Engines Above 500 HP
• These engines are typically natural gas powered engines that are used to power
equipment for oil and gas production.
• EPA is replacing numerical emission limits for existing area source stationary spark
ignition (SI) 4- stroke engines above 500 horsepower (HP) that are located in populated
areas with requirements to install catalytic controls, conduct an initial test and annual
performance checks of the catalyst, and equip the engine with a high temperature
shutdown device or monitor the catalyst inlet temperature continuously.
o Populated areas are defined as not being on Department of Transportation (DOT)
Class 1 pipeline segments or having more than 5 buildings within 0.25 mile radius
of the engine.
• EPA is specifying that existing area source stationary SI 4- stroke engines above 500 HP
that are not located in populated areas are subject to management practices.
o Unpopulated areas are DOT Class 1 pipeline segments or having 5 or fewer
buildings within 0.25 mile radius of the engine.
Remote Areas of Alaska
• EPA is expanding the definition of remote areas of Alaska beyond those not on the
Federal Aid Highway System.
• This amendment addresses issues unique to Alaska residents who have more energy
supply challenges and face harsh weather conditions.
Engines scheduled to be replaced in the next few years due to state or local rules, and
certain engines installed in 2006
EPA is amending the RICE NESHAP to:
• Allow Tier 1 and Tier 2 certified stationary CI engines, that are scheduled to be
replaced due to state or local rules, to meet management practices until January 1,
2015, or 12 years after installation date, but not later than June 1, 2018.
• Specify that existing stationary area source Tier 3 certified CI engines installed
before June 12, 2006, are in compliance with the NESHAP.
4
Compliance Alternative for Formaldehyde Emissions
EPA is adding an option for demonstrating the engines can meet the formaldehyde
emission standard including:
o For existing and new SI 4- stroke rich burn (4SRB) non - emergency engines
greater than 500 HP located at major sources, showing compliance with the
formaldehyde percent reduction standard by demonstrating compliance with a 30
percent reduction of total hydrocarbon emissions.
Stationary Cl Engines on Offshore Vessels on the Outer Continental Shelf
EPA is specifying that existing area source stationary CI non - emergency engines above
300 HP that are on offshore drilling vessels on the Outer Continental Shelf are subject to
management practices.
Emergency Engines
• EPA is specifying how NESHAP and NSPS standards will apply to a category of engines
called emergency engines.
• Emergency engines may be used to prevent electrical outages and to test and maintain
engines for up to a total of 100 hours per year.
• In 2015, emergency engines will be required to use cleaner fuel -- ultra low sulfur diesel
(ULSD) -- if they operate, or commit to operate, for more than 15 hours annually as part
of blackout and brownout prevention, also known as emergency demand response.
o Switching to cleaner fuel will reduce emissions of HAP, particulate matter and
sulfur dioxide. Our information shows that only a small percentage of emergency
engines currently use ULSD fuel. This will result in lower emissions.
• Starting in 2015, entities with 100 horsepower (hp) or larger engines that operate, or
commit to operate, for more than 15 hours and up to 100 hours per year for emergency
demand response will need to collect and submit an annual report including location,
dates and times of operation.
o Reporting requirements ensure compliance with the regulations and provide
information about the air pollution impacts of the engines.
For a combined total of 100 hours per year, emergency engines can be used for the
following purposes:
• maintenance and testing,
• emergency demand response for Energy Emergency Alert Level 2 situations,
• responding to situations when there is at least a 5 percent or more change in
voltage, and
• operating for up to 50 hours to head off potential voltage collapse, or line
3
overloads, that could result in local or regional power disruption.
• The rules restate that in an emergency, such as hurricane or ice storm, any engine of any
size can operate without meeting control requirements or emission limits.
• Emergency engines that commit to run less than 15 hours for emergency demand
response can operate without meeting federal control requirements or numeric emission
limits.
BENEFITS AND COSTS
• The amendments will reduce the capital and annual costs of the original 2010 rules by
$287 million and $139 million, respectively. EPA estimates that, with the amendments
incorporated, the capital cost of the rules is $840 million and the annual cost is $490
million.
The updated estimated reductions each year starting in 2013 are:
0 2,800 tons per year (tpy) of HAP,
0 36,000 tpy of carbon monoxide,
0 2,800 tpy of particulate matter,
0 9,600 tpy of nitrogen oxides, and
0 36,000 tpy of volatile organic compounds.
• EPA estimates the monetized co- benefits of the updated standards to be $830 million to
$2.1 billion. EPA did not monetize the benefits associated with reducing exposure to air
toxics or other air pollutants, ecosystem effects, or visibility impairment.
BACKGROUND
• In 2004, EPA finalized the first regulation for stationary RICE greater than 500 HP
located at major sources of HAP. In 2008, EPA finalized regulations for new RICE less
than or equal to 500 HP located at major sources and new RICE located at area sources.
On March 3, 2010, EPA promulgated NESHAP for existing stationary Cl RICE that are
used at:
o area sources of air toxics emissions and constructed or reconstructed before June
12, 2006,
• major sources of air toxics emissions, have a site rating of less than or equal to
500 HP and constructed or reconstructed before June 12, 2006,
• major sources of air toxics for non - emergency purposes, have a site rating of
greater than 500 HP and constructed or reconstructed before December 19, 2002.
On August 20, 2010, EPA promulgated NESHAP for existing stationary SI RICE that are
used at:
o area sources of air toxics emissions and constructed or reconstructed before June
12, 2006,
El
o major sources of air toxics emissions, have a site rating of less than or equal to
500 HP and constructed or reconstructed before June 12, 2006.
After the publication of the final rules in 2010, various stakeholders raised a number of
issues through lawsuits, petitions for reconsideration of the final rule and other
communications. The stakeholders requested that EPA reconsider requirements for
operation of emergency engines, the control and monitoring requirements associated with
existing SI engines at area sources, the requirements affecting engines in remote areas of
Alaska and provisions related to agricultural engines. EPA granted the petitions, and, to
address the issues, is making these amendments.
• EPA proposed amendments on May 22, 2012. A public hearing was held in Washington,
D.C. on July 10, 2012, and comment was accepted on the proposed amendments through
August 9, 2012. EPA has evaluated the issues raised and has made amendments based on
our assessment of the comments provided.
FOR MORE INFORMATION
• The rule is posted at: http: / /www.0a.gov /ttn/oarpg/new.html.
• For more information on how to comply with the rule, please see:
httv://www.qpa.gov/ttn/atw/rice/ricgpg.html.
Today's rule and other background information are also available either electronically at
http: / /www.regulations.gov, EPA's electronic public docket and comment system, or in
hardcopy at the EPA Docket Center's Public Reading Room.
• The Public Reading Room is located in the EPA Headquarters Library, Room
Number 3334 in the EPA West Building, located at 1301 Constitution Ave., NW,
Washington, D.C. Hours of operation are 8:30 a.m. to 4:30 p.m. eastern standard
time, Monday through Friday, excluding federal holidays.
• Visitors are required to show photographic identification, pass through a metal
detector and sign the EPA visitor log. All visitor materials will be processed
through an X -ray machine as well. Visitors will be provided a badge that must be
visible at all times.
• Materials for this action can be accessed using Docket ID No. EPA- HQ -OAR-
2008 -0708.
• For further information about the action, contact Melanie King of EPA's Office of Air
Quality Planning and Standards, Sector Policies and Programs Division, Energy
Strategies Group at (919) 541 -2469 or by email at king.melanie @epa.gov.
5
M—
Stationary Reciprocating Internal Combustion Engines (RICE)
40 CFR part 63, subpart ZZZZ
Applicability Flowchart
Is your engine
being tested at a
stationary RICE
test cell/stand?e
Does your facility have the potential to
emit 10 or more tons /year of any single
hazardous air pollutant or 25 or more
tons /year of any combination of
hazardous air nollutants ?b
NO
W
You have an area source
YES
YES
START
Do you own
or operate a
stationary
engine?
You have a major source
GO TO STEP 2
Did you begin
construction or
reconstruction on your
stationary engine
before June 12, 2006?
NO
y
You have a new or reconstructed area source
You are not subject to
40 CFR hart 63. subpart ZZZZ
YES —> You have an existing area source
eAn engine test cell/stand is any apparatus used for testing uninstalled stationary or uninstalled mobile (motive) engines. ]
Vor assistance in determining the potential to emit, please refer to http: / /www.gpa.izov /ttn/chiekap42 /index.html or contact your EPA regional office
or state permitting staff. To determine the potential to emit, you may use emission factors from http:// www. epa. t; ov/ ttn/chief/gp42 /chO3 /index.html,
test data, or other published information.
Stationary Reciprocating Internal Combustion Engines (RICE)
40 CFR part 63, subpart ZZZZ
Applicability Flowchart
NO
Did you begin
construction or Does your major
reconstruction on source have a
your stationary staonary engine
engine before
June 12, 2006?
You have an existing
stationary engine of 500 HP
or less at a major source
NO ti
above 500 HP?
You have a new or reconstructed
stationary engine of 500 HP or less
at a major source
Did you begin
construction or
reconstruction on
YES < your stationary
engine before
December 19, 2002?
You have an existing station
engine above 500 HP
at a major source
M
You have a new or reconstructed
stationary engine above 500 HP
at a major source
2
EPA RICE NESHAP (National Emission Standards for Hazardous Air
Pollutants) for Existing Stationary Gas and Diesel Engines
Gas Engine Standards (effective October 2013)
Johnson Matthey
Fi_mT-77 Stationary Emissions Control Tel: 484 - 320 -2125, Fax: 484 - 320 -2152
Suite 200, 400 Lapp Road E -mail: info @jmsec.com
Johnson Matthey Malvern, PA 19335 USA www.jmsec.com
100 to 500 Hp Non - Emergency > 500 Hp that Operate > 24 Hrs/Yr Located at New/
Type of Engine
Engine Located at Major Sources Reconstucted /Existing Major Source or Existing Area Sources
2SLB (2- stroke lean burn)
225 ppmvd CO @ 15% 0, No MACT std. due to insufficient data
4SLB (4- stroke lean burn)
47 ppmvd CO @ 15% 0, 47 ppmvd CO @ 15% O; or 93% CO reduction
4SRB (4- stroke rich burn)
10.3 ppmvd formaldehyde @ 15% O, 2.7 ppmvd formaldehyde @ 15% Oz or 76% formaldehyde
reduction or 350 ppbvd formaldehyde @ 15% O>
Landfill /Digester Gas
177 ppmvd CO @ 15%02
After Treatment
3 -way (NSCR) for rich burn engines and 2 -way (oxidation catalyst) for lean burn engines
Diesel Engine Standards (effective May 2013)
Engine Size
Non - Emergency Engines Located at Major Sources Non - Emergency Engines Located at Area Sources
100 to 300 Hp
230 ppmvd CO @ 15% O,
300 to 500 Hp
49 ppmvd CO @ 15% G. or 70% reduction 49 ppmvd CO @ 15% O, or 70% reduction
> 500 Hp
23 ppmvd CO @ 15% O, or 70% reduction 23 ppmvd CO @ 15% O, or 70% reduction
After Treatment
Burn LILSD and install DOC on non - emergency engines with a site limit of > 300 Hp
Major Source: Any stationary source or group of stationary sources located within a contiguous area and under common control emits or has the potential to emit considering controls, in the aggregate >_ 10 TPY of a
single HAP or > 25 TPY of two or more HAPs.
Area Source: Not a major source I EPA estimates there are > 900,000 stationary Cl engines installed I EPA estimates there are > 330,000 stationary SI engines installed.
Date Applicability: ENGINES >500 HP AT MAJOR SOURCE: Existing if constructed before Dec. 19, 2002 1 New if constructed on or after Dec. 19, 2002 1 Reconstructed if reconstruction began after Dec. 19, 2002.
ENGINES 5500 HP AT MAJOR SOURCE OF HAP AND ENGINES OF ALL HP AT AN AREA SOURCE OF HAP: Existing if constructed before June 12, 2006 1 New if constructed on or after June 12, 2006 1 Reconstructed
if reconstruction began after June 12, 2006.
Johnson Matthey
Fi_mT-77 Stationary Emissions Control Tel: 484 - 320 -2125, Fax: 484 - 320 -2152
Suite 200, 400 Lapp Road E -mail: info @jmsec.com
Johnson Matthey Malvern, PA 19335 USA www.jmsec.com