November 3, 2010

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

Proposed Rule
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Additional details
Agency
Environmental Protection Agency
Regulatory Identification Number
2060-AO48
Agency Name
Environmental Protection Agency
Rule Publication Date
12/08/2009

RULE SUMMARY

This Regulatory Impact Analysis (RIA) provides illustrative estimates of the incremental costs and monetized human health benefits of attaining a revised short-term Sulfur Dioxide (SO2) National Ambient Air Quality Standard (NAAQS) within the current monitoring network of 488 SO2 monitors. Because this analysis only considers counties with an SO2 monitor, the possibility exists that there may be many more potential nonattainment areas than have been analyzed in this RIA.

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?
This regulation is easily findable by searching the RIN on Regulations.gov, but it is not clearly available on the EPA site. Instead, the EPA website has a section on regulations and it points to related sources, such as reginfo.gov
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. Some of the cost data are based on extrapolations of costs for unidentified and non existent control technologies. EPA considers its estimates to be "illustrative" and dependent on state actions.
2/5
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. These models are impossible to verify for this specific rulemaking and its proposal to reduce sulfur dioxide to the levels of 50 ppb to 100 ppb.
3/5
4. Was the analysis comprehensible to an informed layperson?
As mentioned, the analysis is based on many building blocks that EPA has used before, and if an informed layperson was familiar with this material, he or she would have a general idea about what was going on.
3/5

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 identifies and estimates mortality and morbidity reductions that might result from the standard.
5/5
Does the analysis identify how these outcomes are to be measured?
The analysis estimates reductions in emissions and uses models to forecasts that reductions in mortality and morbidity will follow.
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 every five years. 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 provides much empirical support but the full attainment of the standard is, as the analysis shows, not likely to be achieved by 2020.
4/5
Does the analysis adequately assess uncertainty about the outcomes?
The analysis discusses many of the uncertainties but does not incorporate them fully into the analysis.
3/5
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?
3/5
Does the analysis identify a market failure or other systemic problem?
Market failures are discussed in general but not specifically related to this rulemaking. The NAAQS statute is focused on the health benefits and does not permit costs to be considered in setting the standard. The main problem is that short term exposure to SO2 may cause short term respiratory decrements for asthmatics.
4/5
Does the analysis outline a coherent and testable theory that explains why the problem (associated with the outcome above) is systemic rather than anecdotal?
The analysis does not explain why existing standards or planned future ones are or will not be adequate to reduce systemic respiratory morbidity.
3/5
Does the analysis present credible empirical support for the theory?
The empirical support for the health benefits of a short term limit on SO2 is limited mainly to controlled experiments with exercising asthmatics exposed to higher levels of SO2 than proposed. The agency does not present evidence more directly relevant for the proposal.
2/5
Does the analysis adequately assess uncertainty about the existence or size of the problem?
The analysis extensively discusses uncertainty of the problem but states the statute requires that health must be protected "with an adequate margin of safety" even if risk is uncertain. Agency fails to deal with proximity of pollution to human populations and at-risk populations.
3/5
7. How well does the analysis assess the effectiveness of alternative approaches?
2/5
Does the analysis enumerate other alternatives to address the problem?
The rulemaking focuses on alternative one hour standards to replace the existing 24 hour standard. Range of other levels of control are offered but this does not include doing nothing or doing more than the rule proposes.
3/5
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)?
Only alternative one hour standards in parts per billion are analyzed.
1/5
Does the analysis evaluate how alternative approaches would affect the amount of the outcome achieved?
The analysis focuses on how a reduction in SO2 would indirectly reduce fine particulate matter, which in turn would lead to improvements in mortality and morbidity endpoints and provide 99% of the health benefits.
3/5
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?
EPA states that the analysis is illustrative and that in fact the rulemaking itself imposes no legally enforceable requirements on the States or private parties so it is unclear what the baseline will be in 2020 when the rule goes into effect. It depends upon State regulations.
2/5
8. How well does the analysis assess costs and benefits?
3/5
Does the analysis identify and quantify incremental costs of all alternatives considered?
Although costs incremental to the current standard are estimated, costs for control technologies not yet technically feasible are assumed and not estimated.
4/5
Does the analysis identify all expenditures likely to arise as a result of the regulation?
The agency states that the estimates are illustrative and thus it is not clear that all expenditures have been estimated.
3/5
Does the analysis identify how the regulation would likely affect the prices of goods and services?
The analysis looks at compliance cost to revenue estimates by 4 digit NAICS codes and finds them to be small but does not explicitly calculate price impacts.
3/5
Does the analysis examine costs that stem from changes in human behavior as consumers and producers respond to the regulation?
The analysis gives only cursory looks at behavioral changes.
2/5
If costs are uncertain, does the analysis present a range of estimates and/or perform a sensitivity analysis?
The analysis emphasizes the uncertainties by pointing out that it is illustrative and conducting both Monte Carlo and sensitivity analyses. However, it assumes costs are constant.
4/5
Does the analysis identify the alternative that maximizes net benefits?
The analysis presents a table from which you can determine the alternative that maximizes net benefits, but only lists a very narrow range of options and uses linear assumptions of costs and benefits. This means that the highest level of action they measure will automatically have the highest net benefits.
3/5
Does the analysis identify the cost-effectiveness of each alternative considered?
This can be done with the data provided.
3/5
Does the analysis identify all parties who would bear costs and assess the incidence of costs?
The agency does perform illustrative geographical analyses of costs but does not look at incidence or even small business impacts.
3/5
Does the analysis identify all parties who would receive benefits and assess the incidence of benefits?
The agency provides extensive data as to what the benefits might be and, in particular, who would benefit from reduced mortality and various morbidities.
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 analysis.
0/5
10. Did the agency maximize net benefits or explain why it chose another alternative?
The agency proposes three 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?
The monitoring stations will track emissions, but there is no proposal to track health outcomes.
2/5
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?
There are provisions for extensive data monitoring but not for actual health improvements.
3/5
 
Total 30 / 60