February 24, 2011

EPA's New Boiler Rule Will Deliver Reduced -- But Still Huge -- Health Benefits

This post was written by CPR Member Scholar Catherine O'Neill and Communications Specialist Ben Somberg.

The announcement from EPA Wednesday creating final standards for pollution from industrial boilers is being described by the press as “scale[d] back,” and “half the cost of an earlier proposal.” Those things are true, but the new regulation is no small matter. It will have a significant and positive effect on the health of people across the country and beyond.

Says the Sierra Club: "Though the announcement today is modest by comparison to the proposals put forth by the EPA last June, we urge Administrator Lisa Jackson to forge ahead to protect our children and families’ health." NRDC says: "EPA could have done more, but these standards accomplish long overdue, needed cuts in mercury, benzene, heavy metal and acid gas pollution from industrial plants. While the final biomass standards are notably relaxed in response to industry complaints, overall the safeguards still will save up to 6,500 lives, avoid 4,000 heart attacks, and prevent more than 46,000 cases of aggravated asthma and bronchitis every year. Americans deserve these tremendous health benefits without political interference by Congress."

"It appears that EPA has addressed many of the industry complaints while still putting out standards that would bring significant public health benefits," Frank O'Donnell of Clean Air Watch told Greenwire. "Let's hope that EPA stands its ground when industries argue for further changes."

The rule is long overdue. There are several air pollutants at play here, but let me focus on mercury for a moment. Industrial boilers as a category are the second largest domestic source of mercury, after coal-fired power plants. Mercury emitted to the air from boilers and other sources gets deposited to surrounding land and waters; ultimately, it makes its way into fish tissue in the form of methylmercury – a potent neurotoxin to humans. In fact, exposure to even small amounts of methylmercury in utero or during childhood can lead to irreversible neurological damage, placing the developing fetus and children at particular risk. Fish, in many areas a low-cost source of food, is being poisoned by mercury, and advisories suggest reducing or removing it from families' dinner plates as a consequence.

EPA says that "for every dollar spent to cut these pollutants, the public will see between $10 to $24 in health benefits, including fewer premature deaths." That's impressive, and something industry will try to run from. But even those stats don't convey the full picture: EPA analyses of the costs of regulations usually end up over-estimating the actual cost. And the full benefits aren't conveyed in those numbers.

With the previous version of the boiler rule, the EPA didn't give a monetary estimate of the benefits of reduced mercury, as we've explained in this space. And that's true again with Wednesday's rule.

For major source industrial, commercial, and institutional boilers and process heaters, the agency says: "EPA estimates that the value of the benefits associated with reduced exposure to fine particles and ozone are $22 billion to $54 billion in 2014. ... EPA did not provide a monetary estimate the benefits associated with reducing exposure to air toxics or other air pollutants, ecosystem effects, or visibility impairment."

To be sure, putting a dollar figure on the benefits of reduced mercury exposure might not be possible. The point is, even the 10-to-24-times-the-cost point understates the benefits of this rule.

As for the weakening of the rule from EPA’s earlier version, presumably true believers in cost-benefit analysis and economic efficiency would even be a bit disappointed here. Maximizing net positive economic effect would have almost certainly called for a stronger standard than the one issued Wednesday. After all, a little back-of-the-envelope arithmetic reveals that the lives saved from this new rule would come at a cost of somewhat under a million dollars each, and that’s using the low-end of the projection for lives saved and excluding all other monetized benefits. Regulators’ usual pricetag for a human life is about ten times that. So cost-benefit purists who truly believe in the magic of their approach ought to be calling for a stronger rule, one that values lives at something closer to the norm. 

Even with this week's announcement, the journey for EPA’s boiler rule is far from over. Citing the huge substantive changes between the proposed and final versions of the boiler rule, EPA has said it will begin a formal reconsideration process, which will entail another public comment period. That reconsideration process will help EPA defend the rule in court down the road, but also allows it to comply with a court order to publish the final rule immediately and still have a chance to tweak it later. Industry will likely use the reconsideration period as another opportunity to continue attacking the boiler rule, to weaken it even more. For example, the Council of Industrial Boiler Owners, an industry trade group, has already promised to make use of the reconsideration process for just this purpose. But strictly speaking, EPA could also conclude at the end of the reconsideration that the rule should be tougher. Time will tell.

Catherine O'Neill, CPR Member Scholar; Professor of Law, Seattle University School of Law. Bio.

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