Analysis - The Institute for Southern Studies

This is a limiting analysis because it does not include other developments that may be expected increasingly to push CCR to beneficial use:
1. Aspects of the proposed CCR rule: This analysis does not take into account that some RCRA regulatory options for CCR disposal
require electricity plants to move to dry management of CCR, either through changes to air pollution control strategies or through
drying of CCR after they have been generated. This will make the material more amenable to beneficial uses.
2. The analysis is based on current market conditions: It does not take into account new technologies and products now being developed,
for example, involving the use of CCR in brick construction. 155 An increased “avoided disposal cost incentive” could be a great boon
to such new beneficial use technologies, applications, and products.
Comparison of “Raw Materials Acquisition Cost Method” to “Travel Cost Method”
The method applied above involved three cost components of the “raw material acquisition cost,” not just in relation to the transportation cost
component, which is relatively narrower approach that can be called a “Transportation Cost Method.” Compared to this other method, the raw
material acquisition cost method provides a smaller estimate of effect because the incremental cost is evaluated relative to a broader set of costs
thereby translating numerically into a smaller percentage change, rather than relative to only one cost factor which would translate into a
relatively larger percentage change. This methodological difference may be illustrated by using the calculation numbers applied above, to only
the transportation cost factor. Using a simplistic transportation distance model which uses the CCR disposal unit cost ($ per ton) to determine
the average circular radius of a CCR transportation market between electricity utility plant suppliers of CCR and their beneficial users
customers, the increase in transport distance would be calculated as follows (relative to the 2005 49.6 million tons CCR beneficially used as
reported by the ACAA):
Baseline transportation cost (without CCR rule)
($0.26/mile/ton) x (125 miles one-way average CCR transport distance) x (49.6 million tons/year beneficial use in 2005) = $1,612
million/year transport cost
Hypothetical new transportation cost (with rule)
Transport subsidy equivalency = ($85/ton avoided disposal cost under rule) – ($59/ton avoided disposal cost without rule) = $26/ton
subsidy equivalency
(49.6 million tons/year beneficial use) x ($26/ton subsidy equivalency) = $1,290 million per year subsidy equivalency
Hypothetical new transport distance:
[($1,612 million/year) + ($1,290 million/year)] / (49.6 million tons per year beneficial use) / ($0.26/mile/ton) = 225 miles
Percentage increase in transport distance:
[(225 miles) – (125 miles)] / (125 miles) = 80% increase in radial transport distance
155 Several companies are developing technologies to convert CCR into bricks used in construction, and one such technology was recently commercialized at a power plant
in Wisconsin. Some of these technologies have the potential for using 100% CCR (fly ash) in brick production, as opposed to the conventional 30%-50% limit for
replacing Portland cement in concrete.
174