Memorandum reviewing elements of ventilation capital costs. ERG. May 30, 2014

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		MEMORANDUM


To:	Robert Burt, Robert Stone, Bob Blicksilver, OSHA	 
From:	John Eyraud, ERG
Date:	May 30, 2014
Subject:	Review of capital costs for ventilation systems 
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In the Preliminary Economic Assessment (PEA), ERG estimated the capital costs of ventilation systems at $11/cubic foot per minute (cfm) of ventilation capacity. ERG used this estimate in estimating the capital costs for all ventilation enhancements required in general industry. Inflating this cost to 2009 dollars for the regulatory analysis, ERG estimated the capital costs at $12.83 per cfm. (The estimate has not been inflated beyond 2009.) Industry commented that the ventilation capital cost estimate was too low. URS, a commenter to the Silica Public Docket, referred to an estimate of capital expenditures for dust collectors in an EPA publication (EPA, n.d.), which estimated capital costs for large dust collection baghouses at $6 to $26 per cfm.  
To consider the industry comments, ERG assembled information on actual ventilation installations related to reduction of silica exposures. ERG contracted with Air Industries of New England to compile information on ventilation enhancements and to determine or estimate ventilation costs. Air Industries of New England examined database files to which it had access through its affiliation with Donalson Torit, a manufacturer of dust collection equipment. This firm identified 6 ventilation installations to reduce silica dust exposures, as derived from the company files. For these installations, the firm compiled information on the types of ventilation equipment installed and then estimated the current (2014) cost of the equipment. The 6 examples include installations in the facilities producing refractory ingredients, rubber, adhesives, glass, and silica desiccants. While two of the installations occurred in foreign countries, the cost data applied is equivalent to that which is applicable for US installations. The installations also included foundries performing sand casting. Table 1 summarizes the information compiled. 
Air Industries of New England also estimated the costs for four hypothetical installations. Because there were no large installations in their database, they created hypothetical installations with larger air volumes. These were intended to help define the average costs over a realistic range of possible installations.
Table 1 presents the summary of capital and installation costs applicable or estimated to be applicable for these cases. For the dust collection equipment, the average cost per cfm is calculated at $8.42 per cfm. This estimate is in the lower range of the costs estimated for dust collection in the EPA document referenced above. The total capital cost for the equipment, prior to installation, was calculated at $12.65 per cfm on average. 

Table 1. Summary of Actual Recent Ventilation Installations and Selected Hypothetical Ventilation Installations to Reduce Silica Exposures
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                       
                                  System No.
                                      CFM
                                     (000)
                           Air to Material Ratio (a)
                           Dust Collector Model (b)
                                    Fan HP
                            Dust Collector Cost (c)
                         Dust  Collector Cost ($/cfm)
                                    Freight
                           Main Trunk Diameter (in.)
                                  Ducting (d)
                           Total Equipment Cost (e)
                                 Cost per cfm
                                   Location 
                   Installation (at 50% of Eq. Cost, $/cfm)
                       Total (w/50% Installation, $/cfm)
 













 
                                                                              1
                                                                             14
                                                                            5.3
                                  162 MBT 10
                                      50
                                                                        $87,284
                                                                          $6.23
                                                                         $9,500
                                      24
                                                                        $38,550
                                                                       $135,334
                                                                          $9.66
                                      MX
                                                                          $4.83
                                                                         $14.49
                                                                              2
                                                                            1.1
                                                                            4.5
                                    UMA 250
                                      10
                                                                        $14,450
                                                                         $13.14
                                                                         $4,500
                                       7
                                                                         $7,800
                                                                        $26,750
                                                                         $24.31
                                      OH
                                                                         $12.16
                                                                         $36.47
                                                                              3
                                                                           2.81
                                                                           1.23
                                   DFT 3-12
                                      15
                                                                        $43,400
                                                                         $15.44
                                                                         $6,600
                                      11
                                                                         $9,500
                                                                        $59,500
                                                                         $21.17
                                      TX
                                                                         $10.59
                                                                         $31.76
                                                                              4
                                                                              2
                                                                           1.31
                                    DFT 2-8
                                      15
                                                                        $34,450
                                                                         $17.23
                                                                         $5,500
                                       9
                                                                         $8,200
                                                                        $48,150
                                                                         $24.08
                                      MD
                                                                         $12.04
                                                                         $36.12
                                                                              5
                                                                            3.5
                                                                            2.3
                                    DFT 2-8
                                      20
                                                                        $38,488
                                                                         $11.00
                                                                         $6,500
                                      12
                                                                        $11,200
                                                                        $56,188
                                                                         $16.05
                                     Aus.
                                                                          $8.03
                                                                         $24.08
                                                                           6(f)
                                                                             20
                                                                           2.19
                                   DFT 3-48
                                      50
                                                                        $95,604
                                                                          $4.78
                                                                        $12,500
                                      30
                                                                        $41,550
                                                                       $149,654
                                                                          $7.48
                                      US
                                                                          $3.74
                                                                         $11.22
                                                                           7(f)
                                                                             30
                                                                           2.47
                                   DFT 4-64
                                      75
                                                                       $121,250
                                                                          $4.04
                                                                        $18,500
                                      36
                                                                        $42,440
                                                                       $182,150
                                                                          $6.07
                                      US
                                                                          $3.04
                                                                          $9.11
                                                                           8(f)
                                                                             40
                                                                           2.63
                                   DFT 4-80
                                      100
                                                                       $149,860
                                                                          $3.75
                                                                        $22,000
                                      40
                                                                        $52,450
                                                                       $224,310
                                                                          $5.06
                                      US
                                                                          $2.80
                                                                          $7.86
                                                                           9(f)
                                                                             50
                                                                           2.35
                                   DFT 4-112
                                      150
                                                                       $185,000
                                                                          $3.70
                                                                        $24,000
                                      48
                                                                        $65,700
                                                                       $274,700
                                                                          $5.49
                                      US
                                                                          $2.75
                                                                          $8.24
                                                                          10(f)
                                                                             25
                                                                           2.19
                                   DFT 3-60
                                      75
                                                                       $122,030
                                                                          $4.88
                                                                        $14,500
                                      32
                                                                        $42,700
                                                                       $179,230
                                                                          $7.17
                                      US
                                                                          $3.58
                                                                         $10.75
 
 
 
 
 
 
                                                                          $8.42
 
 
Average cost per cfm before Installation
                                                                        $12.65 
 
 
                                                                         $19.01
(a) Air to Material Ratio refers to the volumetric flow rate of air flowing through a dust collectors inlet duct divided by the total media area in the filter. 


(b) Refers to model number for Donaldson Torit line of dust collectors








(c) Includes dust collector, fan, and controls











(d) Ducting must be all 10 ga due to the abrasive properties of Silica








(e) Includes dust collector, freight, and ducting equipment costs. 








(f) Refers to hypothetical examples of representative installations. 








Source: Compiled and estimated for ERG by Air Industries of New England. 












 A large and variable factor in the total capital cost is the installation cost. Air Industries of New England judged that a 50 percent factor for installation costs was as representative a figure as they could develop. Given the capital cost figure, this factor added $6.33 to the total capital cost. The total capital cost for these installations was calculated at $19.01 per cfm on average. 

References
EPA, n.d. Air Pollution Control Technology-Fact Sheet. Fabric Filter-Pulse-Jet Cleaned Type. EPA 425/F-03-025

URS, 2014. Silica PEL Operating Cost Model. Excel. OSHA Silica Docket. 




