Title: NSPS STANDARDS FOR METAL COIL SURFACE COATING

Recipient: SWEITZER, TERRY A., IL EPA

Author: CZERNIAK, GEORGE T., AIR COMPLIANCE BRANCH REGION V

Date: 07/11/90

Subparts: TT

References: 60.15, 60.460, 60.461

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How is reconstruction defined?

Section 60.15 defines "reconstruction" as the replacement of components of an existing facility to such an extent that the fixed capital costs of the new components exceeds 50 percent of the fixed capital costs that would be required to construct a comparable entirely new facility.

The facility in question replaced the coater drives in 1986, the prime oven water quench in 1989 and is in the process of replacing the prime oven and prime coater. The source needs to provide the fixed capital cost required to construct an entirely new prime coating line. However, the equipment replaced is part of the "prime coat operation" as defined under 40 CFR 60.461, and it is EPAs policy to aggregate replacement costs stemming from what appears to be a single planning decision.

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July 11 1990

Region 5

Terry A. Sweitzer, Manager

Permit Section

Division of Air Pollution Control

Illinois Environmental Protection Agency

P.O. Box 19276

Springfield, Illinois 62794­9276

Dear Mr. Sweitzer:

This letter is in response to your June 21, 1990, request for guidance as to whether a prime coat operation has reconstructed pursuant to 40 C.F.R. §60.15, thereby subjecting them to the New Source Performance Standard (NSPS) requirements of 40 C.F.R. Part 60 Subpart TT. (Standards of Performance for Metal Coil Surface Coating). You also requested guidance as to how the United States Environmental Protection Agency (U.S. EPA) would aggregate the cost of periodic component replacement to determine whether an owner or operator had passed the 50 percent reconstruction threshold. The facility in question replaced the coater drives in 1986, the prime oven water quench in 1989 and is in the process of replacing the prime oven and prime coater.

Section 60.15 defines "reconstruction" as the replacement of components of an existing facility to such an extent that "the fixed capital cost of the new components exceeds 50 percent of the fixed capital cost that would be required to construct a comparable entirely new facility" if U.S. EPA determines that it is technologically and economically feasible to meet the applicable NSPS.

At this time U.S. EPA, Region V, is unable to make a determination as to whether the facility passed the 50 percent reconstruction threshold since the facility did not provide the fixed capital cost that would be required to construct an entirely new prime coating line. However, based on the submitted information, U.S. EPA, Region V, believes that the facility has reconstructed the prime coating line through the replacement of the prime coater, coater drives, prime quench and prime oven. The above mentioned equipment constitutes the "prime coat operation" as defined under 40 C.F.R. §60.461.

On the question of cost aggregation it is U.S. EPAs policy to aggregate replacement costs stemming from what may be viewed objectively as a single planning decision. Otherwise, owners and/or operators could evade the reconstruction provisions, by continually replacing obsolete or worn out equipment. In the case of Pre Finish Metals Incorporated, U.S. EPA, Region V, believes that the replacement cost associated with the prime coater, coater drives, prime quench and prime oven, should be aggregated, because they stem from the decision to replace an inefficient and worn out coating line.

If you have any questions or comments, please call Spiros Bourgikos of my staff at (312) 886­6862.

Sincerely yours,

(signed)

George T. Czerniak, Chief

Compliance Section I

Air Compliance Branch (5AC­26­I)