ENGINEERING / ECONOMIC ANALYSIS FOR COTTON GIN COMPLIANCE WITH AIR POLLUTION REGULATIONS

Presented to

Texas State Support Committee

Dr.Calvin Parnell Jr. Department of Agricultural Engineering

Texas A&M University January 20, 1994

ENGINEERING I ECONOMIC ANALYSIS FOR COTTON GIN

COMPLIANCE WITH AIR POLLUTION REGULATIONS

Shobu Yarlaqadda Melanie Gulls

Graduate Research Assistants Dr. Calvin Parnell Jr. Dr. Stephen Fuller

Professors

Texas A&M University

Texas State Support Committee

Introduction

• FCAA • Increased Enforcement • 500 cotton gins (Texas) • 400 "Grandfathered" • "Grandfathered" Gins - Permit

Air Pollution

No person shall discharge from any source whatsoever one or more air contaminants or combination thereof, in such concentration and of such durations

Health Impact

...as to or may tend to be injurious to or to adversely affect health or welfare, animal life, or vegetation...

Nuisance

...or as to interfere with the normal use and enjoyment of animal life, vegetation, or property."

Violation of Compliance

• Complaint

• Inspection

•NOV

•FEC

•BO

Page 1

"Economic Reasonableness"

The proposed facility will utilize the best available control technology, with consideration given to the technical practicability and economic reasonableness of reducing or eliminating the emissions from the facility."

Recent Actions by TACB

For Small Businesses • First Offenders - $ 0 Penalty

• "Tight" locations - Add Controls • BBACT Policy • BBACT+ - Not Defined

Goals

'Define BBACT+

• Define "economic reasonableness"

• The cost per ton of reduced emissions will define "Economic Reasonableness" in terms that the regulator can understand

Specific Objectives • Specify abatement strategies for gins in "tight" locations

• Estimate emission factors • Estimate total mass of particulates emitted each season

Specific Objectives

•Estimate the total installed cost of abatement systems

'Estimate the cost per ton of reduced emissions

Page 2

Proposed Designs

•BBACT

-BACT Dl •BACT D2 •BACT D3

'Centrifugal Fan Exhausts

-ID 3D or 2D 20 Cyclones

'Axial fan exhausts

—Covered condenser Drums

• Axial Fans Replaced with Centrifugal Fans

• All Exhausts -ID 3D or 20 20 Cyclones

BACT D2

'All Exhausts

—Preseparatorl ID 3D Cyclones

BACT D3 • BACT DI plus

• Rotary Drum Filters on Four Exhausts

-Unloading Fan

-Push - Pull Fans

-Trash Fans

Emission Factors

• Pre BBACT - 4 lb/bale

•BBACT -2.24 lb/bale

• BACT Dl -1.6 lb/bale

Page 3

•BACT D2

—Picker Gins -1.06 lb/bale —Stripper Gins -1.2 lb/bale

'BACT D3

—Picker Gins -1.12 lbs/bale —Stripper Gins - 1.28 lbs/bale

Total Mass of Particulates Emitted Each Season

'Type of Abatement Systems

'Ginning Capacity 'Utilization of Gin Capacity

-Emission Factors

Capital Costs

'Cooper and Alley

Parnell Estimates

'Standard Air Flow Rates

'Cost indices

'Cost of Cyclones —0 .4/cf m - $0.8/cfm

-Covered Condenser Drum —$0.1 /cfm

'Preseparators -$0.3 Icfm

Rotary Drum Filters —$2.5 /cfm

Estimated Emission Factors for Picker & Stripper Gins

Abatement Picker Gins Stripper Gins

System Emission Factor Emission Factor lb/bale lb/bale

Pre BBACT 4 4

BBACT 2.24 2.24

BACT Dl 1.6 1.6

BACTD2 1.06 1.2

BACTD3 1.12 1.28

Mass of Particulates Emitted Each Season by Picker Gins

Gin Capcity Bales Pre-BBACT BACTDI

Bales/Hr. Ginned lbs lbs

<10 8000 32000 17900

10-15 10000 40000 22400

15-25 16000 64000 35800

25 - 35 24000 96000 53700

>36 28000 112000 62700

Page 4

Mass of Particulates Emitted Each Season by Picker Gins

Gin Capcity Bales BACTD2 BACTD3

Bales/Hr. Ginned lbs lbs

<10 8000 8500 9000

10-15 10000 10600 11200

16-26 16000 16950 17900 26 - 36 24000 25450 26900

>35 28000 29700 31350

Mass of Particulates Emitted Each Season by Stripper Gins

Gin Capcity

Bales/Hr.

Bales

Ginned

Pre-BBACT

lbs

BACTD1

lbs

(10 8000 32000 17900

10-16 10000 40000 22400

16-26 16000 64000 36850

26-35 24000 96000 53750

>35 28000 112000 62750

Mass of Particulates Emitted Each

Unit Installed Costs for Abatement Season by Stripper Gins

Systems - Picker Cotton

Gin Capcity Bales BACTD2 BACTD3

Gin Capacity BBACT BACTDI BACTD2 BACTD3 Bales/Hr. Ginned lbs lbs Bales/Hr. $/ctm Skim $/cfm j

<10 8000 9600 10250 <10 0.8 1.09 1.63 2.61 10-15 10000 12000 12800 10-16 0.75 1.06 1.48 2.48 16 - 25 16000 19200 20500 15-25 0.68 0.97 1.41 2.44 25-35 24000 28800 30700 25-36 0.65 0.93 1.38 2.42 >36 28000 33600 35850 >36 0.64 0.92 1.36 2.41

Unit Installed Costs for Abatement Systems - Stripper Cotton

Gin Capacity BBACT BACTDI BACTD2 BACTD3

Bales/Hr. $/cfrn $/cfm 51dm jcf.qj

<10 0.81 1.00 1.42 2.77

10-16 0.77 0.98 1.39 2.7 16-26 0.7 0.93 1.35 2.57

25-36 0.66 0.90 1.32 2.5

>35 0.66 0.89 1.31 2.47

Installed Costs for Abatement Systems - Picker Cotton

Gin Capacity BBACT BACTD1 BACTD2 BACTD3

Bales/Hr. $ $ $ $ (in thousands)

<10 56 76 107 175

10-16 66 92 130 217

15-25 95 136 198 342

25-35 136 195 290 508

>36 157 226 333 590

Page 5

60 50

Installed Costs for Abatement Systems - Stripper Cotton

Gin Capacity BBACT BACTD1 BACTD2 BACT03 Bales/Hr. $ $ $ $

In thousands) <10 54 80 113 221 10-15 77 98 139 270 15-25 112 148 216 411 25-35 158 216 316 600 >35 182 249 366 691

Reduction In Tons of Particulates Emitted - Picker Gins

100% Utilization Gin Pre BBACT BBACT BACTD1 BACTDI Capacity to to to to

BBACT -BACTD1 -BACTD2 - BACTD3

<10 7.04 2.56 2.15 1.92

10-16 8.8 3.2 2.7 2.4 16-25 14.08 6.12 4.32 3.84 25-35 21.12 7.68 6.48 5.75 '35 24.64 8.96 7.66 6.72

Reduction in Tons of Particulates Emitted - Stripper Gins

100% Utilization Gin Pre BBACT BBACT BACTD1 BACTD1 Capacity to to to to

BBACT -BACTD1 -BACTD2 - BACTD3

<10 7.04 2.56 1.6 1.28 10-16 8.8 3.2 2.0 1.6 15-26 14.08 5.12 3.2 2.56 25-35 21.12 7.68 4.8 3.84 >35 24.64 8.96 5.6 4.48

Cost of Investment per Ton of Reduction in Emissions - Picker Gins

100% Utilization Gin Pre BBACT BBACT BACTD1 BACT01 Capacity to to to to

BBACT BACTD1 BACTD2 8ACTD$ (S/Ton)

<10 8000 8000 14000 52000 10-16 7500 8000 14000 62000 15-25 6700 8000 14000 54000 25-35 6500 7800 14500 54000

>35 6400 7700 14300 64000

Cost of Investment per Ton of Reduction in Emissions - Stripper Gins

100% Utilization Gin Pre BBACT BBACT BACTD1 BACTDI Capacity to to to to

BBACT BACTD1 BACTD2 BACTD3

(S lion) <10 9000 6000 21000 110000 10 - 16 9000 6600 20500 107000 15-25 8000 7200 21000 102000 25 - 36 7500 7500 21000 100000 >35 7400 7500 21000 99000

Picker Cotton 15 -2 5 bph Capacity 1007. Utilization

- Pr. BBACT - BBACT -SBACT - BACT DI -BACTD1 - BAd 021

PSAC! Di dl 03

A B C 0 Cho o9. f AboI.minl Strategy

Page 6

Stripper Cotton 15-25 bph Capacity 100% Utilization

A 8 C 0

CPK"of Strof.gy

GINMODEL 'Developed by Dale Shaw, Agricultural Economist, USDA

'Maintained by Roy Childers, Extension Engineer, Dept. of Agricultural Engineering, Texas A&M University

PIE

00

- 80

I: 20

GINMODEL

GINMODEL ANALYZE 'Existing Gins 'Computerized Cost Model

'Proposed New Gins 'Economic Engineering Cost

'Modifications to Gins Estimation Procedure

GINMODEL - ASSUMPTIONS & METHODOLOGY

'Capacity, Utilization and Maximum Bale Output

'Capital Requirements and Costs

'Management and Labor Costs 'Total Gin Plant Costs

GINMODEL - VALIDATION

'GINMODEL Projected Costs approximate COBANK Costs

(Bank of Cooperatives, Austin TX)

Page 7

Gin Size

Bales /Season

Gin Size Ginning Costs($Ibale)

BPH COBANK GINMODEL

BPH COBANK GINMODEL

Reo TP

ReD TP

<10 8079 7538 8000 <10 47.56 41.99 42.89-45.02

10-15 12295 11410 12000 10-15 53.11 42.24 40.60-43.32

15-25 18360 18066 18000 15-25 42.54 36.70 40.89

25-35 24075 23605 24000 25-35 43.16 39.95 37.76

>35 35905 33591 35000 >35 39.29 38.18 39.00

RATE OF RETURN (ROR) ON INVESTMENT

COTTON GINS

Industry Norms and Key Business Ratios by Dun and Bradstreet 1988

'Average ROR -11.9% to 16.7%

-Required ROR - 14.7 % -To Remain in Business

ESTIMATED ROR(%) ON ESTIMATED ROR(%) ON INVESTMENT - PICKER INVESTMENT - PICKER

<10 bph (old) GIN VOLUME (bales /season) 4000 6400 8000

<10 bph(mid. age) GIN VOLUME (bales/season) 4000 6400 8000

Pre-Control 16.5 31.08 34.97 Pre-Control 3.14 11.62 13.81 BBACT 6.63 16.77 19.37 BBACT -0.78 5.94 7.4 BACT Dl 3.96 12.96 15.05 BACT Dl -2.49 3.88 5.05 BACT D2 0.74 8.15 9.54 BACT D2 -4.50 1.34 2.12 BACT D3 -4.14 2.12 2.82 BACT D3 -7.44 -2.54 -2.12

Page 8

ESTIMATED ROR(%) ON INVESTMENT - PICKER

<10 bph(new) GIN VOLUME (bales/season)

4000 6400 8000

ESTIMATED ROR(%) ON INVESTMENT - PICKER

10-15 bph(old) GIN VOLUME (bales /season)

7200 9600 12000

Pre-Control 4.46 1.2 2.22 Pre-Control 22.19 33.11 42.81

BBACT -6.29 -1.33 -0.5 BBACT 15.85 24.89 32.62

BACT Dl -7.02 -2.57 -1.97 BACT Dl 13.77 22.30 29.47 BACT D2 -8.32 4.25 -3.89 BACT D2 10.89 18.86 25.22

BACT 03 -10.02 -6.57 -6.51 BACT D3 6.48 13.85 19.09

ESTIMATED ROR ON INVESTMENT - PICKER

10-15 bph(mid.age)GIN VOLUME (bales /season) 7200 9600 12000

ESTIMATED ROR(%) ON INVESTMENT - PICKER

10-15 bph(NEW) GIN VOLUME (bates /season)

7200 9600 12000

Pre-Control 9.19 16.41 22.18 Pre-Control 3.99 10.18 14.46 BBACT 6.32 12.97 17.91 BBACT 2.07 7.98 11.85 BACT Dl 4.97 11.60 16.26 BACT Dl 1.11 6.93 10.69 BACT D2 3.31 9.76 14.08 BACT 02 -0.03 5.55 9.22

BACT 03 0.71 6.79 10.78 BACT D3 -2.21 3.22 6.83

ESTIMATED ROR(%) ON INVESTMENT - PICKER

15-25 bph GIN VOLUME (bales /season) 12000 16000 20000

ESTIMATED ROR(%) ON INVESTMENT - PICKER

25-35 bph GIN VOLUME (bales /season) 18000 24000 30000

Pre-Control 7.04 13.36 19.49 Pre-Control 8.12 15.03 20.76 BBACT 5.60 11.40 16.88 BBACT 6.79 13.14 18.48

BACT Dl 4.85 10.44 15.62 BACT Dl 6.10 12.17 17.33

BACT 02 3.89 9.22 14.00 BACT D2 5.22 10.93 15.86

BACT 03 2.04 7.23 11.53 BACT 03 3.71 8.86 13.44

Page 9

ESTIMATED ROR(%) ON INVESTMENT - PICKER

>35 bph GIN VOLUME (bales /season) 30000 40000 50000

ESTIMATED ROR(%) ON INVESTMENT - STRIPPER

<10 bph (old) GIN VOLUME (bales /season) 4000 6400 8000

Pre-Control 8.72 15.80 22.56 Pre-Control 25.57 43.51 49.76

BBACT 7.65 14.33 20.68 BBACT 11.11 23.8 27.91

BACT Dl 7.01 13.47 19.60 BACT Dl 7.78 19.18 22.47

BACT 02 5.95 12.08 17.87 BACT 02 3.55 12.94 15.66

BACT D3 4.93 10.65 16.05 BACT 03 -4.23 2.31 3.48

ESTIMATED ROR(%) ON

ESTIMATED ROR(%) ON INVESTMENT - STRIPPER

INVESTMENT - STRIPPER

<10 bph(mid. age) GIN VOLUME (bales/season)

<10 bph(new) GIN VOLUME (bales/season)

4000 6400 8000

4000 6400 8000

Pre-Control 8.28 19.38 23.12 Pre-Control -0.91 6.03 8.27 BBACT 2.28 10.89 13.60 BBACT -4.10 2.04 3.59 BACT Dl 0.42 8.10 10.37 BACT Dl -577 -0.09 1.09 BACT D2 -2.20 4.67 6.36 BACT D2 -6.77 -1.60 -0.53 BACT D3 -7.20 -1.89 -1.02 BACT 03 -9.67 -5.81 -5.41

ESTIMATED ROR(%) ON INVESTMENT - STRIPPER

10-15 bph(old) GIN VOLUME (bales /season) 7200 9600 12000

ESTIMATED ROR(%) ON INVESTMENT - STRIPPER

10-15 bph(mid.age)GIN VOLUME (bales /season) 7200 9600 12000

Pre-Control 27.21 39.80 51.17 Pre-Control 12.71 20.52 27.31

BBACT 19.19 29.21 38.11 BBACT 8.91 15.82 21.52

BACT Dl 16.73 26.01 34.15 BACT Dl 7.38 14.10 19.39

BACT D2 13.50 21.93 29.10 BACT D2 5.46 11.97 16.77

BACT 03 6.59 13.66 18.91 BACT 03 1.16 7.26 11.17

Page 10

Stripper Gins Summary

Five Gin Plant Sizes Studied

• Stripper Gins had Higher Rate of Returns than Picker Gins

• All Gins Economically Viable Up To BACT D2 at High Utilization Rates

• BACT D3 is Not Viable For All Plants

-<10 bph

-10 - 15 bph -15 - 25 bph

-25 - 35 bph

->35 bph

Studied Gins Processing -Picker Cotton -Stripper Cotton

• Proposed 3 New Abatement Strategies

• Estimated Emission Factors & Total Particulate Emissions

• Estimated Total Installed Cost

• CaIc. Cost Per Ton of Emission Reduction

• Decrease in Utilization Increases Investment per Ton of Reduction

• Gins With BACT 03 Controls Are Economically Not Viable

• BACT D3 Not Recommended For Gins in Texas

• Stripper Gins Need to Invest More than Picker Gins

• BACT D3 has the Highest Unit Cost & Installed Cost

• Investment per Ton of Reduction -Highest for BACT Dl to BACT D3

Page 13