~i.256

ILLINOIS POLLUTION CONTROL BOARD

April

 30, 1987

ACME BARREL COMPANY,

)

Petitioner,

v.

)

 PCB 86—31

ILLINOIS ENVIRONMENTAL

PROTECTION AGENCY,

)

Respondent.

LAURENCE A. MCHUGH AND JERYL DEZELICK, ROOKS, PITTS AND POUST,

APPEARED ON BEHALF OF PETITIONER;

LISA MORENO AND JOSEPH

R.

 PODLEWSKI,

 JR., APPEARED ON BEHALF OF

RESPONDENT.

OPINION AND ORDER OF TnE BOARD

 (by R.

C.

 Flemal):

This matter comes before

 the Board upon

 a Petition for

Variance filed March

4,

 1986, by Acme Barrel Compan~’ (“Acme”).

Acme seeks variance from the requirements of

35

 Ill.

 Adm. Code

215.204(j), 215.211,

 and 215.212 with respect

 to volatile organic

material (“VOM”) emissions

 from its

 steel drum reconditioning

operations

for

 a period extending until December

31,

 1987.

Acme contends that compliance with the existing standards

would

 impose

 an arbitrary and unreasonable hardship.

 Reasons

Acme cites

 in support of this contention include unavailability

of compliant coatings, prohibitive cost of add—on control

technology, expected success of

 its proposed compliance program,

and

 a de minimis

 effect of Acme’s VOM emissions on the State

of

Illinois’ attainment and maintenance of the National Ambient Air

Quality Standard for Ozone.

Hearings were held on February 11 and March

6,

 198,, both

in

Chicago,

 Illinois.

 At the March

6,

 1987, hearing Acme submitted

a supplement to the variance petition, consisting

 in major part

of

 a revised compliance plan and submission of a compliance

schedule.

 On March 30,

 1987, Acme

 filed

 its post—hearing brief

along with a Motion for Leave

 to File Instanter.

 This motion is

granted.

Previously,

 by filing of February 2,

 1987, the Illinois

Environmental Protection Agency

 (“Agency”)

 recommeded denial of

variance.

In

 its post—heaLing brief,

 filed

 on April

10,

 1987,

the Agency continued

 to recommend denial.

 The Agency added:

“However,

in

 light

 of the new compliance plan presented at

hearing,

 the Agency does not maintain the same strong opposition

77-251

—2--

to

 the variance extension that it held prior

 to the presentation

of the compliance plan”

 (Agency Brief,

p.

2).

 Additionally,

the

Agency noted that Acme’s compliance plan “is

 a promising concept

for achieving compliance by December

31,

 1987, and that the

schedule proposed by Petitioner

 for implementation of the plan

is

reasonable”

 (Id.,

p.

3).

Acme has previously been granted variance from the same

provisions and for the same facility

 in PCB 83—118.

 That

var4nce was granted May 18,

 1984,

 and expired on December 31,

1985’.

 Acme contends that during the term of

 the prior variance

it made diligent, good faith, and concerted efforts

 to comply

with the conditions of the variance.

FACILITY AND OPERATIONS

Acme

is

 a closely—held Illinois corporation engaged

 in the

reconditioning and sale of steel drums.

 It owns and operates a

plant located

 at 2300 West 13th Street,

 Chicago, Cook County,

Illinois.

 The plant

 is located

in

 a mixed residential,

commercial,

 and industrial area and employs approximately 200

people,

 150 of whom are production and trucking workers.

Part

 of the reconditioning process consists of applying

interior and exterior coatings

 to the drums.

 The exterior

coatings are for weatherability and appearance and for product

information.

 Interior coatings act as

 a chemically resistant

barrier between product and the steel package.

 Coatings are

required by federal and State regulations or by customer

specification.

All drums reconditioned by Acme receive exterior coatings.

Open—head drums also typically receive an interior coating.

Closed—head drums typically receive only an exterior coating.

Coatings are applied

 in three paint booths.

 Following coating,

the drums are moved

 to bake ovens where the coatings are cured.

Acme has the capacity

 to recondition approximately 1500

drums per day.

 Typical production consists of

45

 open—head

drums and 55

 closed—head drums.

 Acme is able to sell

reconditioned closed—head drums at approximately $11 each and

open—head drums at $15 each

 (R.2 at 14).

 Acme not only competes

1 At several places in the

 instant record

 the present request

is

characterized as an “extension” of

 the prior variance.

 The Board

believes that the present request

 is more properly characterized

as a request for

 a new variance.

2 All citations

 to the record

 noted herein are to the transcript

77.252

—3—

with other drum reconditioners, but also with manufacturers of

containers made of alternative materials, particularly plastics,

 and with manufacturers of new steel drums.

 New steel drums sell

at approximately $12.75 each

 (R. at 18), which provides the drum

reconditioning industry with little latitude

to

 increase prices

and remain competitive.

 ;cme further asserts that the price

differential between new ~id used drums

 is the lowest it has ever

been

CR.

at

 18).

REGULATORY REQUIREMENTS

35 Ill. Adm. Code 215.204 reads

 in pertinent part:

No owner or operator of

 a coating line shall cause or

allow the emission of volatile organic material

to

exceed

 the following limitations on coating

materials, excluding water, delivered

 to the coating

applicator:

 Miscellaneous Metal Parts

 and Products Coating

kg/i

(lb/gal)

1)

 Clear coating

 0.52

 (4.3)

2)

 Air dried coating

 0.42

 (3.5)

3)

 Extreme performance

coating

 0.42

 (3.5)

4)

 All other coatings

 0.36

 (3.0)

VOM emissions attributable to the

 interior coating

 of drums are

governed by 2l5.204(j)(l); emissions attributable

 to the exterior

coatings of drums are governed

 by 2l5.204(j)(3).

 Thus,

 emissions

are not

 to exceed 4.3 lb/gal

 (.52 kg/l)

 for interior coating

of

drums and 3.5 lb/gal

 (.42 kg/i)

 for exterior coating of drums.

The pertinent part of 35 Iii.

 Adm. Code 215.211

is

subsection

 (a)(i), which establishes December 31,

 1983, as the

date for compliance with Section 215.204(j)

 for all sources

located

 in non—attainment counties

(as

 is Cook County).

The

pertinent part

 of 35

 Ill.

 Adm. Code 215.212

 is subsection

 (a),

which states

 in full:

The owner

 or operator

 of an emission source subject

to Section 2l5..21l(a)(l)

or

(2)

 shall submit to the

of the second hearing, held March

6,

 1987.

77.253

—4—

Agency a compliance plan on or before August 19,1983.

Also pertinent

 to the instant matter

 is 35 Ill. Adm. Code

215.205, which establishes alternative emission limitations.

In

full,

 Section 215.205 states:

Owners or operators

 of coating lines subject

to

Section 215.204 may comply with this Section,

 rather

than with Section 215.204.

 The methods or procedures

used to determine emissions of organic material under

this Section shall

 be approved by the Agency.

Emissions of volatile organic material from sources

 subject

 to Section 215.204,

 are allowable,

notwithstanding the limitations in Section 215.204,

if such emissions are controlled by one of

the

following methods:

a)

 An afterburner

 system, provided that

 /5 percent

of

 the emissions from the coating

 line and 90

percent

 of the nonmethane volatile oryanic

material

 (measured as total combustible carbon)

which enters

 the afterburner

 are oxidized to

carbon dioxide and water,

or:

b)

 A system demonstrated

 to have control elficiency

equivalent to or greater than that provided

under

the

 applicable provision of Section

215.204

 or subsection

(a)

 as approved by the

Agency.

PREVIOUS COMPLIANCE EFFORTS AND HARDSHIP

Compliant Coatings

Acme’s initial efforts at achieving compliance were directed

towards seeking compliant coatings.

 Acme asserts that it was

able

 to make some significant early progress, such that during

the term of

 the variance granted

 in PCB 83—118 Acme was able to

achieve emission levels of

 4.88 lb/gal

 for its interior coating

operation and 4.26 to 4.29 lb/gal

for

 its exterior coating

operation3.

Acme also asserts, however, that it has been unable

 to make

further progress toward finding compliant coatings beyond that

A condition of the PCE 83—118 variance was that average VOM

emissions of

 interior and exterior coatings were not

 to exceed

5.4b lb/gal and 4.25 lb/gal,

 respectively, during the

 term of

the

variance.

77.254

—5—

achieved during

 the pendency of the prior variance.

 This failure

has occurred, Acme asserts,

 in spite of a diligent, good faith,

and concerted effort to seek and test low—VOM coatings.

 Prior

to

filing the present variance petition, Acme had tested 24

different exterior coating products from 10 different coating

manufacturers.

 Results

 of these

 tests are summarized

 in Acme’s

Quarterly Reports filed with the Agency and contained

 in the

record

 in this matter

 as Petitioner’s exhibits A through C.

 Acme

has also continued

 to conduct tests

 of low—VOM coatings

 in the

period since expiration of the prior variance.

 Results of 38

tests conducted between January 1986

 and January 1987 are

summarized

 in Petitioner’s Group Exhibit

1.

All

 of the compliant coatings which have been tested have

presented problems,

 the most common of which

 is an unfavorable

mix

 of the number

 of drums which can be coated per gallon and the

 cost per gallon of coating.

 Compliant coatings have

 a higher

cost

(R.

 at 55—6)

 but generally are capable of coating only an

equivalent or lesser number

 of drums per gallon of

 coating

(R.

at

46—53,

 59—60).

 The later condition exists at least

 in part

because the steel drum reconditioning industry

 is faced with an

inherent limitation on the thickness of coatings which may be

applied to their product.

 This limitation arises because

it

is

necessary to shotblast the surface of the used drums in order

to

remove

 the previous coatings.

 Shotblasting leaves small

indentations on the surface of

 trie drums, which

 in turn must

be

completely filled with the new coating to produce a product

favorable

 in appearance

 to new steel drums.

Acme has also undertaken several changes in production

process designed

 to improve transfer efficiency and hence

the

“mileage” which can be derived from a gallon of coating.

 These

have included heating

 the coatings prior

 to application

to

decrease viscosity,

 increasing the rate of rotation of drums

during the coating operation, modifying

 the coating spray

nozzles,

 and increasing

 the curing temperature

 (R. at 25—8).

Nevertheless,

 tr~esehave been insufficient

 to reverse

the

unfavorable unit cost figures.

 Thus,

 the unit cost of coating

a

drum with the compliant coatings, as tested,

 is contended to

range from 40

 to 115

 above the current cost

 (R. at 43).

 This

cost increase

 is additionally contended

 to materially affect the

price of the drums

 sold by Acme

 (R. at 44).

Many of the compliant coatings, as tested, were also judged

by Acme to have performance deficiencies.

 These include

deficiencies such as poor gloss, cratering, high film thickness,

inability to dry or cure,

 poor appearance, poor coverage,

and

poor hiding (Group Exhibit

1).

Process Modifications and New Equipment

77.255

—6—

Acme estimates that since

1~84

it has expended approximately

one—quarter million dollars on process modifications and new

equipment designed

 to reduce VOM emissions

(R.

at

3).

 These

include the transfer efficiency devices and processes previously

mentioned,

 including a new oven especially for use with high

solids coatings.

 The cited cost also apparently

 includes at

least some of the costs associated with coating

 tests and trials.

Add—On Technology

Acme asserts that

 it has investigated

the

 teasibility

of

installing various add—on equipment, particularly an

afterburner.

 The afterburner solution

 is asserted

 to have a

capital cost of $200,000 to $600,000

 (R. at 30).

 To this figure

must

 be added operating and maintenance

 costs.

 The total cost

is

characterized by Acme as being “prohibitively expensive”

 in light

of the company’s after—tax profit

 in 1986 of $l~2,000 (R.

at

16,

29).

COMPLIANCE PROGRAM

Given

 its failure

 to achieve compliance via use of compliant

coatings, Acme now proposes

 to achieve compliance pursuant to

Section 215.205(b).

 This

 it intends

 to do by venting emissiogs

from its bake ovens4 through its drum incinerator afterburner

thereby incinerating

 those emissions.

 The drum incinerator

 is an

existing piece of equipment used to burn out the residue from

open—head drums after

 the drums arrive at the plant and prior

to

physical reconditioning of the drums.

 The drum incinerator

afterburner operates at a temperature of 1600 óegrees Fahrenheit,

which Acme contends

 is a sufficient temperature to

 incinerate the

bake oven VOM emissions

(R.

at

 32—3).

 Modifications necessary to

 use the drum incinerator

 to also incinerate the bake oven exhaust

At hearing Acme proposed

 to duct only the bake ovens emissions

to the drum incinerator afterburner.

 In Acme’s post—hearing

brief, however,

 there

 is reference

 to “ducting of emissions

 from

the spray booths and cure ovens”

 to the afterburner

 (emphasis

added;

 Acme Brief at 10).

 Absent other

 indication that this

latter statement constitutes an amended compliance program,

the

Board herein assumes that the compliance program is as presented

at hearing.

~ The Board notes

 that the existing afterburner referred

to

in

the proposed compliance plan is distinct from the afterburner

discussed by Acme

 in regard

 to possible add—on compliance

methods.

 The latter would be

 an additional afterburner which

presumably would

 be coupled

 directly to

 tne paint booths and/or

ovens.

~i.256

—7—

are estimated

 to cost $85,000

(R.

 at 33—4,

 38).

Acme additionally contends that approximately 40

 of its

total VOM emissions are emitted

 in the bake ovens

(R.

 at 31).

Thus,

 complete incineration of the bake oven emissions would

produce a 40

 reduction

 in total emissions,

 or be equivalent to a

40

 reduction

 in the VOM content of the coatings.

Acme proposes

 to achieve compliance via the incineration

method according

 to the following schedule:

a.

 Submit

 to the Agency a demonstration of

equivalency under Section 215.205(b)

 by April

30,

 1987;

b.

 Complete final design and begin procurement by

June

 1, 1987;

c.

 Commence construction by September

1,

 1987;

d.

 Complete construction and commence startup by

October

30,

 1987;

and

e.

 Demonstrate compliance by November 30, 1987.

The Board notes that acceptability of Acme’s compliance

program

 is contingent upon Agency approval of equivalency,

pursuant

 to 35

 Ill. Adm. Code 215.205(b).

ENVIRONMENTAL IMPACT

Acme contends,

 and the Board

 agrees,

 that the steel drum

reconditioning industry performs a valuable environmental

function by providing for recycling of used drums.

 The industry

also serves

 a valuable function by disposing of

 or destroying

residual wastes left

 in used drums.

 Both functions would be lost

should the industry become uncompetitive with new drum

manufacturers or with manufacturers of non—steel containers.

Acme further

 contends that VOM emissions from the Acme plant

have had no

 adverse effect on human, plant,

or

 animal

 life,

and

that these emissions are not interfering with Illinois’

attainment of the ambient air quality standard for ozone.

In

support of this contention Acme notes that there has been

a

downward trend

 in the number

 of days that the ozone air quality

standard was exceeded

 at the two air quality monitoring stations

closest to Acme,

 as follows:

Number

 of Exceedences

Station Location

1983

1984

1985

1986

77.257

—8—

2200 N. Cannon

1

1

0

——

57th and Museum

3

0

0

1

CONCLUSION

Given the entirety of the circumstances

 in this matter, the

Board finds that

 if variance were deniea, thereby requiring Acme

to come into immediate compliance, Acme would suffer an arbitrary

or unreasonable hardship.

 Acme has undertaken extensive efforts

to identify compliant coatings.

 Absent complete success

 in these

efforts, Acme

 is now committed

 to a control system which offers

high prospect of attaining compliance.

 The Board believes that

allowing Acme to implement its control system program during the

period of the variance serves

 a general good.

 Therefore the

Board will grant variance

 as requested subject to conditions

consistent with Acme’s compliance plan.

~hile the Board does not dispute that there has been some

improvement in ozone air quality in the Chicago area,

 as shown by

the cited monitoring data,

 the Board does not believe that these

data are sufficient to carry Acme’s argument of “no adverse

effect”

 of its particular emissions.

 Such improvement in air

quality as has occurred

 is attributable to diligent efforts on

the part

 of a great many individual emitters.

 Acme has yet to

demonstrate that

 it has made

 a significant personal contribution

to the observed reduction.

It

 is only because Acme is now

committed to making

 its contribution, and that grant of variance

will facilitate Acme’s coming into compliance within

 a short

time,

 that the Board can accept that Acme’s excess emissions

might have minimal adverse environmental

 impact

 for the term of

the variance.

This Opinion constitutes the Board’s findings of fact and

conclusions of law in this matter.

ORDER

1.

 Petitioner, Acme Barrel Company,

 is hereby granted

variance from 35

 Ill.

 Adm. Code 215.204(j),

 215.211,

and 215.212,

 subject to the following conditions:

A.

 This variance will expire on December

31,

 1987,

or

at

 such earlier time as compliance

 is achieved;

B.

 On or

 before May 15,

 1987, Petitioner

 shall submit

to the Agency

 a demonstration of equivalency under

35

 Ill.

 Adm. Code 215.205(b)

for

 its program of

venting emissions

 to its drum incinerator

afterburner;

77.258

C.

 On or

 before June 1,

 1987, Petitioner

 shall

complete final construction design and shall submit

to

 the Agency an application for

 a construction

permit to effectuate the compliance plan;

D.

 On or before September

1,

 1987, Petitioner shall

commence construction of the permitted equipment of

paragraph C;

E.

 On or before October 3u,

 1987,

 Petitioner shall

complete construction and commence startup of the

permitted equipment of paragraph C;

F.

 Petitioner

 shall demonstrate compliance by November

30,

1987;

Beginning

June

1987,

and

every

month

thereafter,

Petitioner shall submit written reports to the

Agency detailing all progress made

 in achieving

 compliance.

The reports

 shall

 be sent to the

 following

addresses:

Environmental Protection Agency

Division

Air

Pollution

Control

Programs

Coordinator

2200 Churchill Road

Springfield,

 IL 62706

Environmental Protection Agency

Division

Air

Pollution

Control

Region

Field

Operations

Section

1701

South

First

Avenue

Suite

600

Maywood,

60153

Within

days

the

date

this

Order,

 Petitioner

stiall

execute

Certification

Acceptance

and

Agreement

bound

all

terms

and

conditions

the

variance.

Said

Certification

shall

submitted

the Agency at both the addresses specified in paragraph

G.

 The 45 day period shall

 be held

 in abeyance during

any period that this matter

 is being appealed.

The Certification of Acceptance shall read as follows:

CERTIFICATION

77.259

—10—

(We),

______________________,

having

read

the

Order

the

Illinois

Pollution

Control

Board

PCB

86—31,

dated

April

30,

1987,

understand

and

the

said

Order,

realizing

that

such acceptance renders all terms and conditions thereto binding

and enforceable.

Petitioner

By:

 Authorized Agent

Title

Date

ORDERED.

Board

Member

Forcade

dissented.

Dorothy

Gunn,

Clerk

the

 Illinois Pollution Control

Board,

hereby

certify

that

the

above

Opinion

and

Oroer

was

adopted

the,

~e-r~-

day

______________,

1987,

vote

of

___________.

Dorothy

 M.’ Gunn, Clerk

Illinois

Pollution

Control

Board

77.260