Appendix F

SCIENCE AND TECHNOLOGY

BACKGROUND

The Environmental Management program has a mission to manage and direct focused, solution-oriented technology development. The program uses a systems approach to achieve its goals: reducing waste management life-cycle costs, reducing risks to people and the environment during and after cleanup, and solving cleanup problems that currently have no solution. The program has identified five major problem areas requiring technology development: mixed waste, tank waste, contaminated soils and ground water, landfills, and decommissioning facilities. The Office of Science and Technology formed teams for each of the five areas to concentrate technical efforts. In addition, the Office of Science and Technology formed three discipline-oriented, crosscutting technology programs that provide technology systems to the five focus areas.

Budgetary constraints make cost reduction critical. Potential cost savings are a key factor in allocating technology development funds to the focus areas and the crosscutting programs. Potential savings also give regulators and stakeholders information useful for evaluating the value of a new technology. The Office of Science and Technology is currently supporting the development of approximately 170 technology systems. Of these, approximately 120 have cost savings as a primary objective. Thirty-seven of these 120 technology systems serve as the basis for estimating cost savings in the analysis of the 1996 Base Case. Table F.1 displays the 37 technologies by focus and crosscutting program area.

ASSUMPTIONS

The Office of Science and Technology made the following assumptions to develop projected cost savings which are attributable to technology development and summarized in the results section below:

(1) Projected technology development cost savings are based on replacing existing technologies assumed in the Base Case. Cost savings are proportional to the scope of the program. Thus, technology development cost savings for the highest land-use case in the sensitivity analysis will be greater than that for the Base Case.

(2) Technology development cost savings are based on projected cost savings from 37 of approximately 170 technology systems, of which 120 technology systems have identified cost reductions as their primary goal. The selected 37 technology systems/subsystems are at a more mature level of development than those not selected. In the private sector, about one in three technologies under advanced development - at the same relative stage of research demonstration as these selected 37 systems - is likely to be a commercial success. Therefore, selecting the most promising 37 out of 120 technology systems to estimate the aggregate potential cost savings should be a reasonable assumption. Consistently, the total investment for the development of over 170 innovative technology systems/subsystems during the period FY 1990 to FY 1999 has been estimated to be approximately $3 billion (1996 constant dollars).

(3) Projected cost savings affect only direct environmental management costs. Indirect and support costs are not affected.

(4) Savings from the 37 technologies accrue over the entire environmental management life-cycle. Potential savings from future substitutions of even more cost-effective (not yet developed) technology systems/subsystems are not included.

(5) Cost savings are calculated using conservative "success coefficients." These are technology-specific, judgment-based reductions to savings, which recognize that regulatory and technical uncertainties associated with new technologies will reduce the probability of their successful application in all cases.

(6) In all cases, the detailed calculations of the individual technology system cost study are individually subject to changes as cleanup plans and scenarios become finalized and articulated. In addition, full-scale demonstration will provide updated cost and performance data that will affect the individual technology system cost studies. However, the projected overall or aggregate level results remain valid because of the influence of conservative factors, such as the "success coefficients."

METHODOLOGY

Estimating potential cost savings from the successful application of the 37 emerging technology systems/subsystems is a three-step process. The process is necessarily predictive in nature because the 37 technologies have not had sufficient production application to build detailed historical cost and performance data bases. As a result, the cost savings projection estimate methodology uses conservative assumptions and practices to avoid overestimating the potential cost savings.

Development of Alternative Technology System Use Scenarios

The first step in the process is developing an implementation scenario for each of the 37 alternative technology systems. These scenarios will serve for comparison with existing technology systems that underlie environmental management costs in the Base Case. Ultimately, cost savings will be realized when the Department substitutes alternative technology systems that will realize cost reduction for existing baseline technology systems that are used to build up costs in the Base Case. Figure F.1 illustrates an example alternative technology system - in situ bioremediation; it would substitute for an ex situ air stripping pump-and-treat system for ground water contaminated with volatile organic compounds. For each potential substitution, the preliminary condition (for example, contaminated ground water) must be equivalent for both systems, and the end product of the alternative system must be equivalent to or better than the end product of the existing system.

Figure F.1. Example of Comparable Technology System

For each pair of comparable application scenarios, life-cycle costs to construct, operate, and maintain an operating-scale system are estimated. Unit costs for each system are derived by dividing total life-cycle costs of each system by the volume of waste or contaminated media treated. Uncertainties in costs for emerging technologies result in estimates with confidence ranges usually between -30 and +50 percent. To preserve the conservative nature of the projected savings estimate, the upper end of the range is typically employed. Dividing the unit cost estimate for each alternative technology system by its existing technology system counterpart produces a life-cycle unit cost reduction factor for each of the 37 technology systems.

Application of Unit Cost Reduction Factors

Base Case life-cycle costs are composed of cost elements from each of the three major functional elements.

To calculate projected potential savings for specific cost elements, the type and volume of waste or contaminated media involved and the existing technology system to be employed must be identified. Potential savings are only available to the subset of cost elements that employ an existing technology system for which there is an applicable alternative technology system/subsystem. Multiplying the direct unit cleanup costs for the existing technology by the unit cost reduction factor and the volume of waste or contaminated media to be treated in a cost element for which an alternative technology system exists results in a "raw" projected cost savings for that cost element.

There are instances where more than one of the 37 alternative treatment systems can substitute for an existing technology system in a cost element. For example, both in situ bioremediation and in-well vapor stripping could substitute for ex situ pump-and-treat air stripping of contaminated ground water. Site-specific conditions will usually dictate which substitution is optimal. Nevertheless, to preserve the conservative nature of the projected cost savings, the alternative technology system with the lowest unit cost reduction factor (least amount of estimated potential savings) is always substituted for each existing baseline technology system where multiple substitutions were possible.

Use of "Success Coefficients"

Raw projected cost savings for each applicable cost element are adjusted using conservative "success coefficients." These are technology-specific, judgment-based reductions to savings related to the recognition that regulatory and technical uncertainties associated with new technologies may reduce the probability of their successful application in all cases. There are three areas in which a success coefficient is applied: 1) technology applicability, because data are sometimes incomplete regarding waste characterization, planned action by the sites, and the emerging technology performance and cost, 2) stakeholder and regulator acceptance, and 3) site-specific institutional and schedule constraints. The Office of Science and Technology Development assigned a coefficient ranging in value from zero to one (most are in the range of 0.5 - 0.9) for each of the three factors above for each of the 37 technologies. To calculate projected cost savings for specific cost elements, raw projected cost savings are adjusted by each of the three success coefficients for a given emerging technology system.

RESULTS

Conservative projected cost savings from the Science and Technology Development program, for the first decade's $3 billion investment, are estimated in the range of $15 to $20 billion for the Base Case. The range of potential savings is attributable to the associated range of "success coefficients" used by the cost engineers and system technologists in their calculations. Relative to expenditure profiles, these savings are estimated to have a slight impact on the Base Case treatment and remediation expenditures before 1998, but the estimated savings will increase to a level equal to approximately 13 percent of projected treatment and remediation expenditures for the remainder of the environmental management life cycle. Because these estimated cost savings are related to existing treatment and remediation systems and their scheduled implementation, most of the savings will be realized from 2000 to 2030. Although the technology systems in this analysis are at various stages of development, the selected suite of 37 innovative technology systems will presumably be fully developed and implemented during the 1990 to 1999 timeframe.

Chapter -1- / -2- / -3- / -4- / -5- / -6- / -7- / -8-

Appendix -A2- / -B- / -C- / -D- / -E1- / -E2- / -F- / -G- / -H- / Glossary