At the outset of this post, I hope we can all agree that everyone wants clean air. AFPM’s members and their families live in the communities they serve and have as much interest in clean air as any government bureaucrat or environmental NGO. And we’re doing our part. Between 1980 and 2011, air pollutants fell by 63 percent and ozone by more than 30 percent, even as vehicle miles traveled increased by 94 percent. These numbers are owed to billions of dollars of investment in cleaner fuels and vehicle technologies. In fact, the air quality is so good in most of the United States that ozone levels are approaching “background levels”- or the amount of ozone that naturally occurs.
It’s against this backdrop that EPA is considering tightening ozone standards later this year and into 2015. EPA’s Clean Air Scientific Advisory Committee (CASAC) recently voted to recommend an 8-hr standard of 60-70ppb (down from 75ppb in current law). For context, the lower end of the range would place Yellowstone National Park out of attainment with the standard.
My environmental NGO friends will make the argument that lowering the standard is necessary to protect public health. If that’s the case, then I hope they will agree that transparent and quality data matters. Of course, this then begs the question about why EPA refuses to disclose the underlying (and de-personalized) data from the studies it relies on to make determinations about the health impacts of ozone. Without access to this data, researchers and scientists are not able to independently verify or challenge EPA’s health claims, undermining a bedrock principle of administrative law. Thankfully, Congress is leading the charge to restore transparency into EPA’s use of data.
So we know that the benefit is marginal (or uncertain at best), but what about the cost? Today the National Association of Manufacturers released a new report, Assessing Economic Impacts of a Stricter National Ambient Air Quality Standard for Ozone, examining this question and to raise important issues that EPA must consider as it undertakes its rulemaking. At a high-level, NAM projects that a 60ppb standard will reduce U.S. GDP by $270 billion per year through 2040 and cost 2.9 million job-equivalents. For the refining sector, there is a 1.8- 2.3 percent average decline in the sector’s output. That is an enormous hit on the refining industry that threatens to kill the promise of growing energy security in the United States.
The impacts are certainly not limited to refining, as NAM points out. If an area is out of attainment with the standard, it must develop and implement a State Implementation Plan (SIP) to get itself into attainment. For those areas, new investments (read: capital expenditures and jobs) must find offsets for their projected emissions and counties may also require more stringent gasoline specifications. All of these measures add cost and uncertainty for businesses, large and small, as they look to capitalize on the manufacturing renaissance underway in the United States. Of course, there are still many areas of the country that are still in non-attainment with the 2008 standards, leaving one wondering why EPA would move the goalpost again, leaving communities in perpetual economic purgatory.