Facility Pollution Prevention Guide

Prepared by:

Battelle, Columbus (OH) under contract No. 68-CO-003.

Prepared for:

Office of Solid Waste and Office of Research and Development, U.S. EPA

Application:

Financial analysis:
Environmental impact analysis:	---
Waste management/P2:
Environmental cost listing/database:	---
Cost estimation:	---
Alternative product/process comparison:	---

Generalized approaches directed to small-medium sized production facilities for the development of multi-media pollution prevention programs.

Development/publication date and updates:

May 1992. The guide is an update of the 1988 report, "Waste Minimization Opportunity Assessment Manual," that focused primarily on wastes under RCRA. As of now, there have been no further updates of the guide.

Public availability:

Available

Purpose and current use:

Developed as part of programs in the Risk Reduction Engineering Laboratory and the Office of Solid Waste, to encourage pollution prevention (Pollution Prevention Act, 1990). 21,000 copies of the guide have been distributed. This does not include any from NTIS, or any camera ready copies sent to requesting organizations.

Cost information:

The guide is available free of charge from the Risk Reduction Lab. The guide is also available through NTIS at a cost of $27.

Contents and system requirements:

Profitability analysis for a hypothetical waste minimization project, assessment worksheets, sources of additional information, examples. A separate product, the Strategic Waste Minimization Initiative (SWAMI) is a software program developed for EPA by PEER consultants and the University of Dayton Research Institute. This product uses process analysis to identify pollution prevention opportunities and is to be used along with the Facility Pollution Prevention Guide. A summary paragraph on SWAMI is included at the end of this section of the resource guide.

Summary of methodology

This economic evaluation example presents a profitability analysis for a hypothetical waste minimization project. The example considers improvements in plant production while reducing raw material consumption and disposal costs.

Life-cycle stages covered

Raw material acquisition	---
Manufacturing stage
Use/reuse/maintenance
Recycle/waste management

The activities considered primarily make up the waste generation stage of the life cycle and include the following:

• activities associated with capital costs

  -equipment (purchase, taxes, insurance)
  

  -installation (labor, utilities, building modifications)
  

  -internal and external project engineering
  

  -environmental permitting
  

  -raw materials (purchase chemical inventories/supplies)
  

  -start-up activities
  

  -contingency (unforeseen costs/overruns)
  

• activities associated with operating costs and revenues
  

  -decrease in raw material consumption
  

  -revenue from sale of product
  

  -disposal
  

  • off-site disposal fees
    
  • state generator taxes
    
  • transportation costs
    
  • other costs
    

  -labor, supervision, overhead
  

  -operating supplies
  

  -maintenance labor and supplies
  

Type of costs considered

Conventional
Potentially hidden
Contingent	---
External	---

The methodology estimates only conventional and hidden costs associated with a production process. The hidden costs mainly include O&M costs and permitting costs. Liability and less-tangible (potentially hidden internal) costs are discussed briefly in the chapter on "Economic Analysis of Pollution Prevention Projects." Potential liability is to be rated on a scale of 1 - 10 in the waste stream worksheet, but no costs are estimated. Contingency is taken into account, but this does not factor in liability costs.

Method of cost estimation

Users estimate all costs as lump sums. No default values or sources of data are provided.

Generation of financial indicators

Net present value (NPV)
Payback period
Internal rate of return (IRR)	---
Benefits cost ratio	---
Other	---

The document briefly discusses NPV, IRR and Profitability Index (PI). These are recommended as appropriate long-term indicators that account for all cash flows and the time value of money. The payback period is not recommended as an appropriate method for assessing pollution prevention projects. However, the sample worksheet for calculating profitability uses this method.

Attributes

The manual provides general information and guidelines on developing pollution prevention programs, implementing projects, and measuring progress. It discusses the economic analysis of projects, the design of environmentally compatible products, and energy conservation. It also includes information on sources of technical and financial assistance.

Limitations

Default sources of cost data and methods of cost estimation are not provided. The guide is a generalized document, and is not designed as a comprehensive guide for pollution prevention. It does not discuss methods of estimating external and liability costs.

Basis for evaluation:

The information provided here is based on a profile of the tool presented in Weitz et al. (1994).

Contact information:

Available through the EPA Risk Reduction Laboratory, ORD Publications. Report number: EPA/600/R-92/088. It is also available through NTIS, accession number: PB92213206

For copies of the guide and information on reprinting and distributing the guide:

ORD Publications

Pollution Prevention Research Branch

Risk Reduction Engineering Laboratory

U.S. EPA

Cincinnati, Ohio 45268

513-569-7562

National Technical Information Service (NTIS)

800-553-6847

703-487-4679

703-321-9038

703-321-8547 (FAX)

For information:

Lisa Brown (project coordinator)

U.S. EPA

M/S 466, 26 West Martin Luther King Drive

Cincinnati, OH 45268

513-569-7634

Information on SWAMI

Doug Williams

(CERI), Cincinnati, OH

513-569-7361

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