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H-1 A P P E N D I X H Economics Associated with the Use of Recycling Agents H.1 INTRODUCTION The amount of reclaimed asphalt pavement (RAP) annually available in the United States is of the order of 80 million tons. Hot mix asphalt (HMA) production on an annual basis (including warm mix asphalt (WMA) is typically in the range of 400 to 500 million tons per year. Thus, if every ton of HMA produced contained 15 to 20% RAP, all of the produced RAP would be utilized. The economics of increasing RAP contents from about 20 to 40% is therefore of interest. The information contained below identifies likely cost savings associated with increasing RAP contents in HMA. The information provided defines first costs. It has been assumed that the high RAP, HMA materials will produce the same pavement life as non-RAP mixes and thus the life cycle cost savings will be reflected in the first costs savings. Determination of the economic advantages requires price/cost information for transportation of materials, virgin binders, recycling agents, virgin aggregates and reclaimed asphalt pavement (RAP). An appreciation of HMA price/cost components is also needed. Assumptions associated with prices/costs for transportation, materials, HMA production and laydown as well as mix design are provided below. Economic comparisons are provided based on these assumptions. From a practical standpoint, the RAP is not located near the HMA production in the percentages identified above. For example, most metropolitan areas have an excess of RAP relative to the amount of HMA produced. Some rural projects also generate large quantities of RAP that can be economically transported to HMA production plants. These excess materials have been used as shoulder backing and base course materials. From a practical and economic point of view, it is desirable to use higher percentages or RAP to produce HMA in some locations. As the percentage of RAP use increases in HMA from about 15% to higher values, HMA performance problems can occur if mixes are not properly designed and constructed and pavement thicknesses are not properly designed. Higher RAP percentages require softer binders and/or recycling agents for mix design to avoid field performance problems including raveling and cracking. Sufficient RAP quantities exist at enough locations for technology to be developed to allow for the use of RAP contents higher than 15 to 20%.
H-2 Evaluating the Effects of Recycling Agents on Asphalt Mixtures with High RAS and RAP Binder Ratios H.3 ASPHALT MATERIAL PRICES Virgin Binder The typical price of virgin binder without polymer modification is about $350/ton at the refinery as of September 2016. Over the last decade, these prices have ranged from about $300 to $1200/ton. The prices are for typical binders graded by the PG binder system and commonly available from several refineries. In some areas of the United States, premiums are paid for binders that are softer than conventional grades. For example, a PG 58-28 binder may be priced at $450/ton while at PG 64-22 may be priced at $350/ton. PG binder grades containing conventional loadings of polymers typically price between $90 and $120/ton more than neat binders (binders without polymers). Transportation prices for binders are typically $0.15/ton per mile of haul as indicated above. For a typical haul distance of from 250 to 350 miles, the price of a ton of binder at the contractors HMA plant is about $400/ton ($40 to $50/ton of haul costs plus the refinery costs of about $350/ton). Recycling Agents Prices for recycling agents vary widely. New products are constantly being developed and are entering the market. Prices for these new prices are in general not available at this time, as they have not been used in large quantities. Aromatic recycling agents as defined by ASTM have been on the market since the 1950âs and some price information is available for these materials. Typical prices per gallon of aromatic type recycling agents are of the order of $1.25 to $1.75 per gallon. A gallon of this type of recycling agent is about 8.07 lbs. Since these products are manufactured at only a few locations in the United States, the transportation prices can add from $0.10 to 0.30 per lb. of material. Typical ranges in prices for aromatic type recycling agents at the contractorâs plant will be in the range of from $500 to $700/ton. Typically, the prices of these recycling agents will be from $50 to $150/ton above the price of a neat binder. H.4 AGGREGATE COSTS Aggregate prices vary widely depending on local geology, quarry/pit locations and haul prices. Aggregates on the Gulf of Mexico shores are typically shipped by water several hundreds if not thousands of miles or by rail several hundreds of miles. Truck transportation from the quarry/pit to the contractor HMA plant is the most common form of transportation. H.2 TRANSPORTATION PRICES Transportation prices for binders and aggregates are typically $0.15/ton per mile of haul. These prices usually range from about $0.12 to $0.18/ton per mile. The price of moving a ton of binder or aggregates 100 miles is about $15/ton of material. Local market conditions can be lower or higher than the prices indicated above.
Economics Associated with the Use of Recycling Agents H-3 H.5 RECLAIMED ASPHALT PAVEMENT (RAP) The cost of RAP in a processed stockpile at the contractor HMA plant also varies significantly. Contractors obtain RAP from their own construction projects while others obtain RAP from other contractors or public agencies. When RAP is obtained from a contractor own construction project, the milling costs may be assigned to the project under construction while the haul costs of the milling assigned to the RAP at their HMA plant. Other contractors will assign the cost of milling or removal of RAP and the haul costs for the RAP to the project under construction. Some contractors are able to receive RAP at no or very low costs from local government agencies or other non-HMA producing contractors. Thus, the contractor has very low RAP cost at the HMA plant. The cost of processing RAP, which includes loading, crushing, sizing and stockpiling, is in the range of $2.50 per ton. When haul costs and processing costs are summed, RAP costs to the contractor can be in the range of $5 to $8/ton. Representative price/cost for the various materials are shown on Table H.1. Table H.1: Representative Prices/Costs. Item Unit Price/Cost, dollars Representative Range Representative Value Transportation Per ton-mile 0.12 to 0.18 0.15 Virgin Binder Per ton 400 to 800 450 Recycling Agent Per ton 500 to 700 550 Virgin Aggregate Per ton 12.00 to 15.00 13.00 RAP Per ton 5.00 to 8.00 6.00 H.6 MIX DESIGN CONSIDERATIONS Several mix design considerations are important when determining the value of RAP use in HMA. The amount of RAP utilized, the available binder in the RAP, the amount of virgin binder used and the amount of recycling agent used are among the more important variables that contribute to the cost of recycled HMA. Amount of RAP in Mix The amount of RAP in a HMA mix is typically 15 to 20% by weight of total mix. There is an economical incentive to increase the RAP content. Presently available HMA construction equipment limits the high RAP contents to about 40 to 50%. The price for aggregate in many areas of the country at the contractor HMA plant is within the range of $12 to $15/ton. As stated above a significant part of the price of aggregate is transportation with aggregate prices at the quarry/pit source of the order of $5 to $10/ton.
H-4 Evaluating the Effects of Recycling Agents on Asphalt Mixtures with High RAS and RAP Binder Ratios Available Binder in RAP The amount of binder available in the RAP is dependent on a number of factors. Typical ranges for available binder in RAP used by industry are between 4.0 and 4.75% by weight of RAP. Amount of Virgin Binder in Mix The amount of virgin binder used in an HMA mix will depend on the asphalt demand for a mix without RAP, the amount of available binder in the RAP and the amount of recycling agent. For the purposes of this economic analysis, it has been assumed that the total binder content (virgin binder plus binder available from the RAP plus the recycling agent) is of the order of 5.5% by total weight of mix. Amount of Recycling Agent Recycling agent contents vary considerable depending on the agent. If soft asphalt cement is used as a recycling agent and the price is the same as a conventional binder, the virgin binder and the recycling agent (soft binder) are identical. When the aromatic type recycling agents and other specialty materials are utilized the price of the recycling agent may range from $500 to $700/ton or greater. Typical recycling agent contents range from 2 to 10% by weight of total binder. Total binder is the sum of the binder available on the RAP, virgin binder and the recycling agent. H.7 HOT MIX ASPHALT COST/PRICE The calculations summarized are for materials costs only in the HMA. Costs for the mixing plant and equipment at the plant location, transportation to the job site, laydown and compaction, quality control/quality assurance, overhead and margins or profits are not included. Cost differences associated with materials cost are summarized. The costs savings for materials are nearly identical to those for the savings in the produced mix. Production plant costs, equipment, transportation, laydown and compaction, quality control/quality assurance, overhead and margins are little affected by the use of RAP. For reference purposes, the price of a ton of HMA materials is typically in the range of $55 to $85/ton with a representative value of approximately $70/ton. Material costs are typically in the range of 45 to 55% of total in-place price of HMA. HMA plant production prices including materials and equipment are of the order of 80 to 85% ($55 to $60 per ton) of the in-place price of HMA. Haul, laydown and compaction of the HMA are typically of the order of 15 to 20% ($10 to $15 per ton) of the in-place price of HMA. H.8 ECONOMIC CONSIDERATIONS A calculation spreadsheet for calculating materials costs associated with HMA production is available. This spread sheet used mix design and cost assumptions provided above and summarized in Table H.1. In addition, it has been assumed that no recycling agent has been used for mixes with 0 and 10% RAP additions, 2% recycling agent for mixes with 20% RAP, 5% recycling agent for mixes with 30% RAP and 10% RAP for mixes with 40% RAP.
Economics Associated with the Use of Recycling Agents H-5 Low Economic Incentive Scenario For this scenario, the virgin binder and aggregate prices are relatively low and the recycling agent and RAP costs are relatively high with the amount of binder from the RAP at a relatively low level. The assumptions are provided below: Virgin Binder $400/ton Recycling Agent $700/ton Virgin Aggregate $12/ton RAP $8/ton Binder in RAP 4 % Table H.2 indicates that cost savings are of the order of $0.16 to $0.20 per percent RAP for the various RAP percentages used in the mix. For 40% RAP mixes the cost savings is approximately 12% of the production costs and 9% of the total in-place costs. The cost saving by increasing the RAP content from 20% to 40% is $2.68 or 4.9% of the production costs and 3.8% of the total in-place cost. Table H.2: Cost Associated with Low Economic Incentive Scenario. RAP,% Recycling Agent,% Materials Costs, $/ton Cost Difference $/ton of HMA $/percent RAP 0 0 33.34 -- -- 10 0 31.34 2.00 0.200 20 2 29.67 3.67 0.184 30 5 28.17 5.17 0.172 40 10 26.99 6.35 0.159 High Economic Incentive Scenario For this scenario, the virgin binder and aggregate prices are relatively high and the recycling agent and RAP costs are relatively low with the amount of binder from the RAP at a relatively high level. The assumptions are provided below: Virgin Binder $800/ton Recycling Agent $700/ton Virgin Aggregate $15/ton RAP $5/ton Binder in RAP 4.75 % Note the cost of the recycling agent is below that of the virgin binder. This is not the usual case for aromatic recycling agents. This lower cost assumes that a non âpetroleum base recycling agent is available at a lower cost. Table H.3 indicates that cost savings are of the order of $0.49 per percent RAP for the various RAP percentages used in the mix. For 40% RAP mixes the cost savings is approximately 35% of the production costs and 20% of the total in-place costs. The cost saving by increasing the RAP content from 20% to 40% is $10.04 or 17% of the production costs and 11% of the total in-place cost. Considerable costs saving are evident when virgin materials costs are relatively high and recycling
H-6 Evaluating the Effects of Recycling Agents on Asphalt Mixtures with High RAS and RAP Binder Ratios agent and RAP costs are relatively low. This supports the observed interest in recycling when virgin materials costs and in particular binder costs are high. Table H.3: Cost Associated with High Economic Incentive Scenario. RAP,% Recycling Agent,% Materials Costs, $/ton Cost Difference $/ton of HMA $/percent RAP 0 0 58.18 -- -- 10 0 53.34 4.84 0.484 20 2 48.47 9.71 0.485 30 5 43.50 14.68 0.489 40 10 38.43 19.75 0.494 Impact of Individual Material Costs on Using 40 versus 20% RAP Common quantities of RAP in HMA are 15 to 20% of the total HMA weight. Typically, these mixes are made with soft, virgin binders and without recycling agent. As stated previously, the cost of the soft, virgin asphalt cements can be the same price as typical paving grade binders or in some areas of the country they are elevated in price from $60 to $120 per ton. The information presented below assumes that the price of the soft, virgin binder is about the same as a typical paving grade binder. The information presented below (Table H.4) assumes that the total binder content by weight of mix is 5.5% and no recycling agent has been used for mixes with 0 and 10% RAP additions, 2% recycling agent for mixes with 20% RAP, 5% recycling agent for mixes with 30% RAP and 10% RAP for mixes with 40% RAP. Other assumptions for the comparisons presented were based on cost assumptions for materials that provided the lowest economic incentive. Selection of different costs for other materials would provide a higher economic benefit or difference. The greatest cost savings associated with the increasing the RAP content from 20% to 40% is associated with changes in the virgin binder price (Table H.4). During periods when virgin binder cost saving are high, costs savings of the order of $7.50 per ton ($0.35 per percent RAP) can be appreciated. Changes in costs associated with recycling agents, virgin aggregate, RAP and the percent binder available in the RAP will also impact the costs savings when mixes are produced at 20% versus 40% RAP. These cost savings are typically of the order of $2.50 to $3.50% per ton of hot mix produced or about $0.15 per percent RAP utilized. Tables H.2 and H.3 can also be used to illustrate potential cost saving when utilizing 40% RAP as compared to 20% RAP. The low economic incentive scenario indicates a cost saving of the order of $3.00 per ton of mix produced ($0.15 per percent RAP). The high economic incentive scenario indicates a much larger cost savings of the order of $10.00 per ton or about $0.50 per percent RAP. During periods of high material costs (virgin binder and aggregates), saving associated with the use of higher RAP contents and recycling agent (20% to 40% RAP) will be of the order of $6.00 to $8.00 per ton or from $0.30 to $0.40 per percent RAP.
Economics Associated with the Use of Recycling Agents H-7 Table H.4: Sensitivity Associated with Costs for Individual Mix Materials. Variable Cost Range, $/ton Cost of Materials, $/ton Cost Difference 20 % RAP 40 % RAP $/ton of HMA $/percent RAP Virgin Binder 400 29.67 26.99 2.68 0.134 800 48.03 40.39 7.64 0.382 Recycling Agent 500 29.45 25.89 3.56 0.178 700 29.67 26.99 2.68 0.134 Virgin Aggregate 12 29.67 26.99 2.68 0.134 15 31.91 28.63 3.28 0.164 RAP 5 29.07 25.79 3.28 0.164 8 29.67 26.99 2.68 0.134 Available binder in RAP, % 4.0 29.67 26.99 2.68 0.134 4.75 29.07 25.79 3.28 0.164 H.9 SUMMARY The cost savings associated with the use of RAP is very dependent on the cost of virgin binder and to a lesser degree on the costs for recycling agent, virgin aggregate, RAP and the amount of binder available in the RAP. The low economic incentive scenario (low virgin material prices (binder and aggregates) and high RAP and recycling agent prices) provides an economic incentive of the order of $0.15 to $0.20 per percent RAP utilized in the mix. A mix with 40% RAP will have a savings of about $6.25 per ton while a mix with 20% RAP will have a savings of about $3.65 per ton. The additional saving associated with increasing the RAP content from 20 to 40% is about $3.00 per ton of HMA or about 5% of the production cost of HMA. The high economic incentive scenario (high virgin material prices (binder and aggregates) and low RAP and recycling agent prices) provides an economic incentive of the order of $0.45 to $0.50 per percent RAP utilized in the mix. A mix with 40% RAP will have a savings of about $20.00 per ton while a mix with 20% RAP will have a savings of about $10.00 per ton. The additional saving associated with increasing the RAP content from 20 to 40% is about $10.00 per ton of HMA or about 15% of the production cost of HMA. During periods of high material costs (virgin binder and aggregates), saving associated with the use of higher RAP contents and recycling agent (20% to 40% RAP) will be of the order of $6.00 to $8.00 per ton or from $0.30 to $0.40 per percent RAP. These savings are about 10 to 15% of plant production prices and about 7 to 10% of in-place prices for HMA. The magnitude of the potential price/cost savings is of large enough magnitude to support technology improvements to support RAP use moving from 20% to 40% for selected projects. This magnitude of cost savings is significant for the contractor and public agency. If 5 million tons of HMA were produced with 40 versus 20% RAP, the savings would be within the range $20 to $50 million per year depending primarily on the price of virgin materials (binder and aggregate).