May 2, 2014

Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces, and New Residential Masonry Heaters

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Environmental Protection Agency
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The Environmental Protection Agency (EPA) is proposing new source performance standards (NSPS) for residential wood heaters, wood-fueled pellet heaters, Hydronic Heaters, Forced-Air Furnaces, and Residential Masonry Heaters. According to the EPA, these new lower-emission standards will generate improvements to the environment and to public health, primarily through the lowering of the emissions of pollutants like particulate matter, carbon monoxide, and volatile organic compounds. The EPA believes these pollutants contribute to increases in human mortality and other health problems.

Unfortunately, the EPA fails to acknowledge the high degree of uncertainty surrounding the proposed rule’s estimated benefits. A growing literature is questioning the causal link between the total concentration of ambient particulate matter and mortality levels, especially at the low doses that exist today in many parts of the United States. Furthermore, the EPA overestimates the net benefits by failing to recognize emission reduction trends that will continue to take place without any federal regulatory requirement. The EPA also fails to empirically analyze whether customers may respond to the higher priced wood-fuel units by either delaying the replacement of older wood-fueled units or by switching to other fuel sources that produce more CO2 emissions per unit of energy produced. Additionally, the EPA fails to consider the adverse effects of this rule on those with low incomes. 

The EPA can enhance the analysis of this proposed rule by acknowledging the degree of uncertainty surrounding the health benefits of the regulation. The EPA should construct a more precise emission-reduction benefit measure that includes local variation specific to wood-stove use, such as background particulate levels and population. The EPA should also report the benefits using a hormetic, or J-shaped, dose response curve. In order to generate a more realistic baseline, the EPA should use recent, non-federally regulated emission reduction trends to project future emission improvements that will take place without any new federal regulation. This will provide a smaller, more realistic emissions baseline. The EPA should estimate the net effect of emissions, including the likely net increase in carbon dioxide emissions, that will be produced as households seek to avoid the more expensive new-units by extending the lifespan of wood-fuel units currently in operation and by switching from wood to other fuel sources. Finally, the EPA should include the costs faced by households who rely on wood stoves as an insurance mechanism against power outages and income or job loss. 

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