Sep 02, 2014 - 5:00pm

New Ozone Standard Would Squelch Growth

Senior Editor, Digital Content

Just before it went off on its long Labor Day weekend, EPA staff recommended that ozone standards be reduced, The Hill reports:

Specifically, the EPA’s staff asked that the ground-level ozone standard be lowered to between 60 and 70 parts per billion, down from the current 75 parts per billion.

Areas with higher levels must submit plans to the EPA to lower their concentrations of ozone, a byproduct of pollutants from burning fossil fuels.

EPA staffers recommended a lower standard despite ozone levels declining by 25% over the last three decades.

If the standard is set to 60 ppb, “94% of the population would live in places out of compliance and subject to new emission reductions requirements,” according to the American Petroleum Institute. For example, the entire state of Louisiana would be non-compliant as would nearly all of Nevada.


Map: Ozone concentrations at 60 ppb.
Source: American Petroleum Institute.

Non-compliant areas would be subject to emission reduction requirements that, according to Mary Martin, Energy, Clean Air and Natural Resources Policy counsel for the U.S. Chamber, will stymie economic development [emphasis mine]:

Indeed, severe repercussions result almost immediately from non-attainment designation, such as increased costs to industry, permitting delays, restrictions on expansion, as well as impacts to transportation planning. There are significant adverse consequences to being designated a non-attainment area, making it substantially harder for a community to attract new business or expand existing facilities. Furthermore, in non-attainment areas, EPA is able to revise existing air permits, which can cause tremendous uncertainty, delays, and increased costs in the permitting process for businesses.

Simply put, it will be harder to build things and do business in these areas.

Imagine what this will do to a state like Louisiana. “The indications for the economy are nothing short of disastrous for Louisiana,” Jim Patterson, Vice President of Government Relations and Director of the Environmental Quality Council for the Louisiana Association of Business and Industry, told “When you move the goal post, the instinct of businesses that get impacted is to get paralyzed.”

Then there is Nevada that's in a unique situation. Ray Bacon is executive director of the Nevada Manufacturers Association points out that most of his state’s ozone “is attributable to natural climatic factors and ozone arriving here from other states. Reaching the proposed goal could be flat out impossible in our higher elevation regions, but the rule implies stopping all economic growth if we remain non-compliant.” Under a stricter ozone standard, Nevada will “lose a staggering 11,200 job equivalents each year and shed $19 billion in Gross State Product from 2017 to 2040.”

On a national level, lowering ozone levels will be one of the costliest regulations ever. EPA’s own estimate found that complying with a standard of 60 ppb to 70 ppb would cost as much as $90 billion annually. However, Jay Timmons, President and CEO of the Natural Association of Manufacturers called this a “gross underestimation” [subscription required]. He wrote in the Wall Street Journal:

According to a new study for the National Association of Manufacturers by NERA Economic Consulting, the new ozone standard could cost Americans $270 billion annually, put millions of jobs at risk, and drastically increase energy prices for consumers and manufacturers.

A 2013 U.S. Chamber-funded study found that a less-stringent 65 ppb level “would reduce worker incomes by the equivalent of 609,000 jobs annually on average from 2013 through 2037.”

EPA proposed lowering the ozone emissions to between 60-70 ppb in 2010. However, the following year, President Obama told EPA to withdraw the proposal. The President should again put the kibosh on this costly regulation.

About the Author

About the Author

Sean Hackbarth
Senior Editor, Digital Content

Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.