EPA Ozone Hearings: Achievable Goals

By August 29, 2007Economy, Energy

Annual net benefits for implementation of the proposed standards (i.e., 0.070 ppm to 0.075 ppm) in 2020 range between -$20 billion and +$23 billion. Because of the high degree of uncertainty in these calculations, EPA cannot estimate whether costs will outweigh benefits, or vice versa.

EPA Fact Sheet – Regulatory Impact Analysis of EPA’s Proposed Revisions to the National Ambient Air Quality Standards for Ground-Level Ozone

Shouldn’t that one grand uncertainty stop the conversation about the EPA’s proposed new ozone standards right there? We’re going to suck billions and billions of dollars out of the economy to attack smog because it MIGHT help? Maybe?

Background: The first two of five hearings the EPA is holding on new, more restrictive ground-level ozone standards take place tomorrow in Philadelphia and Los Angeles. Details at the EPA page here.

The list of speakers for Philadelphia is here; for Los Angeles, here. The NAM’s Bryan Brendle, our policy expert on emissions, will speak in Los Angeles.

Even as the U.S. air is getting cleaner, many localities are still unable to meet the current standards, and yet the EPA wants to make the requirements even stricter. Contrary to the arguments of those supporting heavier regulations, the scientific case for the new standards id disputable. In fact, a lot of assumptions, big leaps of methodology and extrapolations were made to justify the new limits, as clearly outlined in the Senate committee testimony of Roger O. McClellan, an expert in toxicology and human health-risk analysis, at a hearing last July. We highly recommend you read his presentation.

Some of tomorrow’s testimony will be highly emotional, no doubt, from people who have real health problems; a child with asthma is scheduled to speak in Los Angeles, and no doubt she’ll be prominently featured in the news coverage. But we keep hearing that asthma rates are increasing, a case often made in the most provocative fashion possible. Yet the air is getting cleaner. So something else must be at play.

Stricter regulations also carry enormous costs. As the NAM’s Brendle will testify tomorrow, indeed, the EPA’s estimates of costs range from $10-$22 billion per year, making it among the most expensive federal regulations ever issued.

How would industry respond? In some cases, they could well spend the money on new technology to meet the heavier regulatory standards. But that’s not “found money”; it has to come from someplace else, R&D, health care, capital investment, expansion, payroll.

But in other cases, the rational decision will be to move the business, perhaps overseas, or to another region of the U.S. already in compliance (that is, areas with less industry, which means less economies of scale, which means higher costs). Or, for many business, compliance costs will simply be too much. They’ll close.

Unemployment isn’t so healthy for people, either.

The NAM’s position is that there is no sound policy reason for changing the current standard, which should be allowed to continue to work. Given the disputed methodologies, the EPA proposed standard is serving only a goal of politics, not the environment or public health.

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