= Constant dollar investment excluding value attributed to recapitalization and idle capacity Sewered population without treatment in 1962 Sewered population without treatment in 1968 Gallons per capita per day, the norm for domestic wastes (2) [(P2G)-Pa] 100 Increase in gallons per day of sewage throughput between 1962 and 1968 G · Appropriate growth factor, based on U.S. Bureau of Census population estimates, for metropolitan and non-metropolitan components of each regional grouping, subject to the constraint that P2. G may not be negative Operation and maintenance costs of waste treatment plans consist of expenditures for operators and technicians, power, chemicals and miscellaneous supplies. A previous volume in this series documented the magnitude of operations and maintenance costs. The Cost of Clean Water and Its Economic Impact, Volume I, FWQA, U.S. Department of the Interior, 1969. Furthermore, it was reported then that there has been a failure to appreciate the magnitude of this cost and rather to concentrate on plant investment. Further statistical analyses summarized here, indicate that annual operation and maintenance expenditures have been somewhat underestimated in previous reports. The revised estimates are that in 1962 operating and maintenance costs totaled $185.7 million (1962 = 100) and that in 1968 the total was $230.0 million (in 1962 dollars), a 23.8 percent increase. The objective of this chapter is: to reevaluate the method of measuring these costs; to recalculate the total amount of annual O&M costs; and to evaluate the relationship between the size of the treatment plant, the degree of utilization of the plant, and the resulting costs of operating and maintenance. Annual operation and maintenance (O&M) expenditures should be considered as a short run cost rather than a long run cost. Traditional methods of estimating O&M costs have assumed that these costs were of a long run nature. The approach used in this chapter assumes that O&M costs are short run, the basic difference being that the plant size is fixed in the short run while in the long run it is allowed to vary. This method of estimating O&M costs provides an O&M cost curve for each plant size category. Thus the O&M cost for treatment plants of different sizes within the U.S. can be estimated. Also, this approach provides a framework for evaluating the excess cost incurred for constructing a plant that has a larger capacity (size) than is needed at a given time. The 1969 Cost of Clean Water report also discussed factors tending to lead to an increase in operating costs on a national aggregate basis not the least significant of these are the pressures for improved operational efficiency. This analysis does not address an optimum level of operation and maintenance expenditures; the total will well exceed current levels. However, in the face of a significant total increase in this area, the inefficient use of operation and maintenance expenditures becomes more critical. The section therefore concerns itself with more efficient allocation of such funds within the context of a growing expenditure. DETERMINANTS OF OPERATING AND MAINTENANCE COSTS A number of factors influence the level of operating and maintenance costs of a sewage treatment plant. First, as the degree of [p. 87] treatment becomes higher for a given concentration of wastes in the influent, operating and maintenance costs will increase. Second, the operating and maintenance costs vary with the type of treatment and the waste characteristics to which applied. Technological characteristics differ among treatment types which, in turn, will lead to corresponding differences in costs for different rates of flow, quality of effluent, and geographical characteristics. For example, for 85 percent BOD removal at an average flow rate of 15 million gallons per day (MGD) with a highly concentrated influent, an activated sludge process may prove to be less expensive to operate than a standard rate trickling filter, but at a considerably lower flow rate with a less concentrated influent, the standard rate filter would probably prove to cost less to operate and maintain than an activated sludge process. Within a given category of treatment, no simple ordering of process types by operating and maintenance costs is possible, but given the full characteristics of the waste treatment needs of a community, one type of treatment will generally yield the min imum attainable level of operating costs consistent with a desired effluent quality. Population density and the mix of industrial activities are two rather obvious features that partially determine both the hydraulic loading and waste concentration demands on a treatment plant and, thus, partially determine the level of operating and maintenance costs of the plant. Third, the location and geographical characteristics of a community will, in part, determine the level of operating and maintenance costs that the community will experience subsequent to the installation of a waste treatment plant. Among the locational factors influencing operating costs are the prices of power and personnel and the general level of prices facing the community. Climatic conditions affecting operating costs include thermal patterns and the frequency, duration, amount and intensity of precipitation. Topographic characteristics can sometimes affect treatment plant costs, particularly pumping and transmission costs. Ascertaining the specific impact of these locational and geographical factors on the costs of operating and maintaining a treatment plant is beyond the scope of this study, but it is necessary to recognize that they are part of the complex of determinants affecting the levels of operating and maintenance costs. Finally, an additional determinant of a treatment plant's operating and maintenance costs which has not generally received attention is the interaction between the design capacity of the plant and the actual rate of capacity utilization of the plant. The design capacity of a plant can be identified as the rate of flow that the plant can treat, at a desired degree of waste removal. It is also the rate which is expected to yield the lowest unit costs of operation and maintenance. For an operating plant of given design capacity, with the exception of some stabilization ponds, certain costs are necessarily incurred. A minimum amount of personnel is required for operation, maintenance and surveillance. To not maintain minimum numbers of personnel is to risk plant breakdown and to sacrifice quality of [p. 88] effluent. In order that chemical treatments have their intended effects on influent, certain minimal chemical feed rates depend not only on the actual flow into the plant but also on the volume and surface area of the tanks in the plant. Even at the lowest rates of capacity utilization, a minimum level of power consumption is necessary for the treatment plant to be operative. All of these minimum technological requirements imply that a treatment plan will incur a necessary minimum level of operating and maintenance costs, and these costs are a direct function of the design capacity of the plant. Such costs are referred to as overhead costs. Overhead costs increase as the design capacity of a treatment plant increases, other things being equal. A bigger plant simply requires larger minimum amounts of personnel, chemicals, and power. Up to a point in the neighborhood of design capacity, then, for a treatment plant of a given type and design capacity, unit operating and maintenance costs should decline with increased plant utilization. As utilization increases from lower rates toward 100% of design capacity, the overhead costs are spread over a greater average daily flow and input units become more effective. Conversely, unit operating and maintenance costs should rise as the rate of capacity utilization declines below design capacity. This cost behavior is illustrated in Figures 6 and 7 by the statistically estimated cost functions for primary treatment and trickling filter treatment plants of 2.5 and 10 MGD design capacity. In the range of zero to fifty percent of capacity, unit costs decline rapidly and begin to level off thereafter and the unit cost curve for the larger plant lies above that of the smaller plant, in the ranges depicted, reflecting cost differences between design capacities. Thus, it is clear that in addition to the degree of wastewater treatment, treatment plant technology, and the hydraulic and geographical characteristics of a community, the design capacity of a community's treatment plant, together with the actual rate at which the capacity is utilized, will have a significant bearing on the level of operating and maintenance costs that a community will experience. This last factor is important not only for the purposes of understanding the underlying determinants of operating and maintenance costs, but also provides, in part, a basis for assessing and evaluating the economic consequences of over-capacity in sewage treatment plants in the United States. THE CONCEPT OF A PENALTY COST From an earlier discussion in this volume, it is apparent that underutilization of capacity is the rule in the operation of sewage treatment plants in the United States. Taking eighty percent utilization of plant as benchmark for effective capacity utilization, it can be seen from Table 25 that in 1968 (the most recent year for which data are available) 61.1 percent of the plants in metropolitan areas and 65.7 [p. 89] |