Industry Groups Blast EPA Ground-Level Ozone Rule

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The U.S. Environmental Protection Agency (EPA) (Washington, D.C.) on October 1 lowered the National Ambient Air Quality Standards (NAAQS) for ground-level ozone to 70 parts per billion (ppb), down from the current level of 75 ppb. The move, sharply criticized by a wide range of industrial groups, including power utilities, petroleum refiners and petrochemical manufacturers, drew faint praise from environmental groups, who wanted a more significant reduction.

Ground-level ozone (O3), a precursor of smog, is produced when oxides of nitrogen (NOx) and volatile organic compounds (VOCs) interact in the presence of sunlight. Emissions from electric utilities, motor vehicles, gasoline vapors and chemical solvents are the major man-made sources of NOx and VOCs, according to the EPA.

The EPA was under a court order to issue a new NAAQS ozone standard by October 1. To protect public health, the Clean Air Act directs the EPA to review ozone standards and five other pollutants every five years to determine if new standards are required to protect public health. The NAAQS regulate ozone levels by setting allowable emission standards for a variety of pollutants, including particulate matter (PM), sulfur dioxide (SO2), nitrogen dioxide (NO2) and carbon monoxide (CO). Federal courts have said the EPA cannot consider the costs of new regulation when ordering new ozone standards that protect public health.

Still, in announcing the new ozone standard, the EPA did issue a cost-benefit calculation: The public health benefits of the updated standards, estimated at $2.9 billion to $5.9 billion annually in 2025, outweigh the estimated annual implementation costs of $1.4 billion, the EPA said.

The agency has been considering new ground-level ozone standards for several years. In 2011, the White House forced then-EPA Administrator Lisa Jackson to abandon efforts to tighten allowable ozone levels to between 60 ppb and 70 ppb. Last November, the EPA released a proposal finding that the then-current ozone level of 75 ppb did not adequately protect public health. The agency proposed a new ozone range from 65 ppb to 70 ppb. It also requested comments on a 60-ppb standard, as well as leaving the current standard of 75 ppb in place.

The new rule could result in up to several hundred metropolitan areas being classified as "non-attainment areas," which would force local governments to enact measures that could limit industrial activity. The EPA said the Clean Air Act provides states with time to meet the new standards. Depending on the severity of their ozone problem, areas would have until between 2020 and 2037 to meet the new 70-ppb standard, the agency pledged.

Industrial groups have long warned about the economic cost of lowering ozone concentrations under NAAQS. For more information on this, see March 3, 2015, article - Expert: Proposed NAAQS Rule Would Hit U.S. Industry Hard, and July 29, 2014, article - Could Tighter Federal Ozone Standards Slow Oil & Gas Production in Eagle Ford Shale? Lawyers and lobbyists for Western states and industrial interests have said that naturally occurring ozone levels already exceed 75 ppb.

"Put simply--ozone pollution means it hurts to breathe for those most vulnerable: our kids, our elderly and those suffering from heart and lung ailments," EPA Administrator Gina McCarthy said October 1 in announcing the new ozone standard. "Our job is to set science-backed standards that protect the health of the American people. Today's action is one of the most important measures we can take for improving public health, reducing the costs of illness, and protecting our children's health."

"Nationally, from 1980 to 2014, average ozone levels have fallen 33%, while the economy has continued to grow," McCarthy continued. "And by 2025, EPA projects that existing rules and programs will bring the vast majority of the remaining counties into compliance."

The National Association of Manufacturers (NAM) (Washington, D.C.) blasted the new ozone standard as "overly burdensome, costly and misguided," NAM President and Chief Executive Jay Timmons said in a statement. "For months, the administration threatened to impose on manufacturers an even harsher rule, with even more devastating consequences. After an unprecedented level of outreach by manufacturers and other stakeholders, the worst-case scenario was avoided. However, make no mistake: The new ozone standard will inflict pain on companies that build things in America--and destroy job opportunities for American workers. Now it's time for Congress to step up and take a stand for working families."

The National Association of Convenience Stores (NACS) (Alexandria, Virginia), said the new ozone standard would be the costliest regulation in history. It predicted the new NAAQS "will likely have a significant negative effect on the retail motor fuels market."

In a statement, Chet Thompson, president of the American Fuel & Petrochemical Manufacturers (AFPM) (Washington, D.C.), said: "EPA's decision to lower the ozone standard is the administration's latest blow to consumers and the U.S. manufacturing renaissance. The agency ignored the nation's steadily decreasing ozone levels and bipartisan pleas from thousands of state and local officials, business groups, and other stakeholders that urged EPA to maintain the existing, stringent standard."

"This rule is just one of the administration's many high-cost regulations that continue to place undue hardship on not only the fuel and petrochemical manufacturers, but on American workers, businesses and communities," Thompson continued. "We urge Congress to consider the mounting impact these numerous and sometimes conflicting regulations will have on our nation's manufacturing competitiveness, and take the appropriate steps to protect our country's economic welfare."

The Edison Electric Institute (EEI) (Washington, D.C.), the trade group representing the nation's shareholder-based utilities, had said if the EPA decided a new ozone standard was needed, it should be set at 70 ppb. "While compliance challenges remain with the new standard at 70 ppb, the EPA has recognized the serious implementation concerns raised by stakeholders of setting the standard below 70 ppb," EEI President Thomas Kuhn said in a statement October 1.

The EEI said the electric power sector "has made great progress in reducing the environmental impact of electricity generation, cutting sulfur dioxide (SO2) emissions by 80% and NOx emissions by 74% since 1990, even as demand for electricity has increased." EEI members produce about 70% of the electricity in the U.S.

The American Public Power Association (APPA) (Washington, D.C.), which represents the nation's 2,000 public power utilities, had urged the EPA to keep the existing 75 ppb standard for ozone. "It is working," the group said earlier this year. "In light of the potential economic hardship, reduction in funding for crucial civic services, and uncertain benefits that would arise from the more stringent ozone standards that EPA is now considering, APPA calls on EPA to retain the existing ozone standards in the final rule."

Environmental organizations offered lukewarm support for the EPA's new ozone standard. Michael Brune, executive director of Sierra Club (San Francisco, California), said, "The Obama administration has fallen short of setting a smog standard that fully protects the health of our families, making this decision a missed opportunity to clean up our air and protect the most vulnerable Americans."

"Lowering the smog standard from 75 ppb to 70 ppb is a modest step in the right direction, but it doesn't go far enough to protect the millions of Americans living in communities with dangerously high levels of smog pollution," Brune continued. "Over the past seven years, medical scientists have been clear that any standard above 60 parts per billion (ppb) puts our communities at risk and is especially dangerous to children, seniors, and people with respiratory illnesses."

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