November 2, 2010

Review of the Primary National Ambient Air Quality Standard for Nitrogen Dioxide

Proposed Rule
Summary

Score: 32 / 60

Additional details
Agency
Environmental Protection Agency
Regulatory Identification Number
2060-AO19
Agency Name
Environmental Protection Agency
Rule Publication Date
07/15/2009
Comment Closing Date
09/14/2009

RULE SUMMARY

Based on its review of the air quality criteria for oxides of nitrogen and the primary national ambient air quality standard (NAAQS) for oxides of nitrogen as measured by nitrogen dioxide (NO2), EPA proposes to make revisions to the primary NO2 NAAQS in order to provide requisite protection of public health. Specifically, EPA proposes to supplement the current annual standard by establishing a new short-term NO2 standard based on the 3- year average of the 99th percentile (or 4th highest) of 1-hour daily maximum concentrations. EPA proposes to set the level of this new standard within the range of 80 to 100 ppb and solicits comment on standard levels as low as 65 ppb and as high as 150 ppb. EPA also proposes to establish requirements for an NO2 monitoring network that will include monitors within 50 meters of major roadways. In addition, EPA is soliciting comment on an alternative approach to setting the standard and revising the monitoring network. Consistent with the terms of a consent decree, the Administrator will sign a notice of final rulemaking by January 22, 2010.

METHODOLOGY

There are twelve criteria within our evaluation within three broad categories: Openness, Analysis and Use. For each criterion, the evaluators assign a score ranging from 0 (no useful content) to 5 (comprehensive analysis with potential best practices). Thus, each analysis has the opportunity to earn between 0 and 60 points.

Criterion Score

Openness

1. How easily were the RIA , the proposed rule, and any supplementary materials found online?
2060-AO19 can be found from regulations.gov using RIN and using a keyword search. To find the RIA on regulations.gov, search by keyword (the title). On the EPA website, the proposed regulation can be found by clicking on Laws and Regulations. They then provide various links to search engines to find the RIA.
4/5
2. How verifiable are the data used in the analysis?
Most of the data is based on models used in other EPA rulemakings and projects and would be impossible for one person to verify. Most of the cost data are based on extrapolations of costs for unidentified and non existent control technologies based on assumed fixed costs. But this is done to be transparent in the face of uncertainty.
3/5
3. How verifiable are the models and assumptions used in the analysis?
The agency uses many complex models that in some cases were developed for other rulemakings that are impossible to verify for this specific rulemaking and the reduction of nitrogen dioxide to the proposed levels of 80 ppb to 100 ppb.
2/5
4. Was the analysis comprehensible to an informed layperson?
The analysis is based on building blocks that EPA has used in other rulemakings, and if an informed layperson was familiar with this material, he or she would have a general idea about what was going on. But the analysis was very difficult for the reader to understand, heavy on acronyms, profuse usage of unexplained technical jargon. The paper was well-organized and made use of graphs and visuals, but it was very difficult to follow.
2/5

Analysis

5. How well does the analysis identify the desired outcomes and demonstrate that the regulation will achieve them?
4/5
Does the analysis clearly identify ultimate outcomes that affect citizens’ quality of life?
The analysis points to improvements in mortality, morbidity and the environment as the goal of the regulation.
5/5
Does the analysis identify how these outcomes are to be measured?
Not directly, but the outcomes are expected to result from the reduced emissions of NO2.
4/5
Does the analysis provide a coherent and testable theory showing how the regulation will produce the desired outcomes?
Most of the models used can be tested and verified with additional data generated from the standard, and the statute requires that the standard be revised periodically. However, to actually produce the results envisioned, the states have to issue implementing regulations.
4/5
Does the analysis present credible empirical support for the theory?
The analysis of the NO2 benefits is not well supported, but most of the benefits flow from the fine particulate matter reduction, which are based on previous EPA rulemakings.
3/5
Does the analysis adequately assess uncertainty about the outcomes?
The rulemaking discusses numerous sources of uncertainty and uses several approaches to express it, including using expert elicitation and sensitivity analyses.
4/5
6. How well does the analysis identify and demonstrate the existence of a market failure or other systemic problem the regulation is supposed to solve?
2/5
Does the analysis identify a market failure or other systemic problem?
A systematic market failure is not well identified since it appears that existing regulations will go far in reducing NO2 risks by 2020.
2/5
Does the analysis outline a coherent and testable theory that explains why the problem (associated with the outcome above) is systemic rather than anecdotal?
There does not appear to be a systemic problem because only two monitors (in LA and El Paso) subject to very special circumstances would exceed levels of NO2 not proposed to be regulated.
1/5
Does the analysis present credible empirical support for the theory?
See comment above.
1/5
Does the analysis adequately assess uncertainty about the existence or size of the problem?
The analysis lists and discusses a significant number and amount of uncertainties, including the fact that the analysis is hypothetical and the regulation is not enforceable.
4/5
7. How well does the analysis assess the effectiveness of alternative approaches?
5/5
Does the analysis enumerate other alternatives to address the problem?
A wide range of stringency levels (from 50 ppb to 150 ppb) are analyzed.
5/5
Is the range of alternatives considered narrow (e.g., some exemptions to a regulation) or broad (e.g., performance-based regulation vs. command and control, market mechanisms, nonbinding guidance, information disclosure, addressing any government failures that caused the original problem)?
The range of options is mainly confined to stringency levels.
3/5
Does the analysis evaluate how alternative approaches would affect the amount of the outcome achieved?
The analysis does examine incremental outcomes of several stringency levels.
5/5
Does the analysis adequately address the baseline? That is, what the state of the world is likely to be in the absence of federal intervention not just now but in the future?
The baseline is projected to 2020 and takes into account the likely impacts of other Clean Air Act regulations in 2020.
5/5
8. How well does the analysis assess costs and benefits?
3/5
Does the analysis identify and quantify incremental costs of all alternatives considered?
The incremental costs of the main stringency options (ppb) relative to a 2020 baseline are presented.
4/5
Does the analysis identify all expenditures likely to arise as a result of the regulation?
The costs are based on an assumed fixed costs per ton of emissions of NO2 reduced (e.g.., $15,000) times tons reduced needed to meet the emission limits, which is illustrative rather than a real costs because currently no control technologies exist for 50 ppb for certain counties.
2/5
Does the analysis identify how the regulation would likely affect the prices of goods and services?
There is a table showing costs per revenue ratios by NAICS codes, which presumably would lead to higher prices for those sectors.
3/5
Does the analysis examine costs that stem from changes in human behavior as consumers and producers respond to the regulation?
The cost data mentioned above could be used for that purpose.
2/5
If costs are uncertain, does the analysis present a range of estimates and/or perform a sensitivity analysis?
Three costs per ton emissions reduced are presented for illustrative purposes because controls costs could not be identified for the 50 ppb level.
3/5
Does the analysis identify the alternative that maximizes net benefits?
The analysis does present tables from which one can figure this out.
3/5
Does the analysis identify the cost-effectiveness of each alternative considered?
Again this is not done but the data to do this are presented in tables.
3/5
Does the analysis identify all parties who would bear costs and assess the incidence of costs?
Assuming the fixed cost assumption is real, costs are presented by county and NAICS codes but not business size or actual incidence.
3/5
Does the analysis identify all parties who would receive benefits and assess the incidence of benefits?
People with respiratory problems living in certain identified counties are likely to benefit.
5/5

Use

9. Does the proposed rule or the RIA present evidence that the agency used the analysis?
The agency clearly states that it does not and would not use the RIA.
0/5
10. Did the agency maximize net benefits or explain why it chose another alternative?
The agency examines various stringency levels but does not chose among them and states that it is prohibited from maximizing net benefits.
1/5
11. Does the proposed rule establish measures and goals that can be used to track the regulation's results in the future?
There are over 400 monitoring stations and more on the way near highways that will be used to track ambient NO2 levels and infer results of the emission limits, but it is not clear this will track actual emission source reductions.
3/5
12. Did the agency indicate what data it will use to assess the regulation's performance in the future and establish provisions for doing so?
As mentioned above, there will be data monitoring and NO2 levels can be tracked, but it is not clear that NO2 actual controls would be responsible. Moreover what is actually required will be determined by state regulation.
3/5
 
Total 32 / 60