The EPA’s Latest Threat to Economic Growth
Recently, we’ve been telling you about the EPA’s new ozone standards and what could be their effect on the nation’s economy. Now, Jay Timmons, the president and CEO of the National Association of Manufacturers lays out the case against the new standards in this Op-Ed article he wrote this week for the Wall Street Journal.
The agency’s needless new ozone standard could cost Americans $270 billion annually
By JAY TIMMONS President and CEO of the National Association of Manufacturers
In a town famous for inaction, Washington is gearing up to take action on a major policy issue. But there’s a hitch: The outcome could be the most expensive regulation in the nation’s history, possibly tanking the economy and costing jobs at a time when businesses, manufacturers and families are making a comeback.
Later this year, the Environmental Protection Agency will decide whether it should tighten the air-quality standard for ground-level ozone. There are several things about this possible new standard that are alarming.
Just a few years ago, in 2008, the EPA set ozone standards for air quality at 75 parts per billion (ppb). And just recently the second-highest court in the land held that the current standard protects public health.
Yet even before states have fully implemented the 2008 standard, the EPA is expected to propose revising it to as low as 60 ppb. In 2010, the EPA estimated that the annual compliance costs for a 60-ppb standard would be $90 billion in 2020.
But that’s a gross underestimation of the potential damage the new standard will do to the U.S. economy. 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.
No single regulation has come close to rendering this level of self-inflicted and ultimately unnecessary economic pain. Remarkably, the EPA has only identified one-third of the controls and technologies that companies and state governments will need to implement to meet the new standard. The other two-thirds are what the agency refers to as “unknown controls.”
However, we do know that the new ozone standard could mean shutting down, scrapping, and modifying power plants, factories, heavy-duty vehicles, farm equipment, off-road vehicles and even passenger cars. Costs would be passed on to consumers, who would have thousands less to spend every year.
The new rule is likely a few months away—yet few understand how the new standard would work, or the aggressiveness of the EPA’s approach.
Ground-level ozone is a pollutant that can be formed from the exhaust of cars and trucks, or from the emissions of power plants and factories. But it also occurs naturally, from plants, fires or simply ozone from the stratosphere. Some ozone travels or drifts to the U.S. from countries as far away as China.
Over the past three decades, better technology and a commitment on the part of manufacturing companies to reduce emissions have yielded a considerable decrease in U.S. ozone levels. Even as the economy has expanded, ground-level ozone levels have fallen by 25% since 1980. Manufacturers continue to work to adhere to existing ozone standards, utilizing state-of-the-art equipment and systems such as selective catalytic reduction and low NOX burners to ensure that this downward trend continues.
If a city or county exceeds the EPA’s ozone standard, the agency will declare it in “nonattainment.” That can essentially ban further economic growth, requiring emissions reductions—either through expensive upgrades or the shutdown of industrial facilities until the ozone levels meet the standard.
At 60 ppb, the progress accomplished by manufacturers and states will be rendered largely irrelevant, as nearly every state in the union will find itself immediately in nonattainment. At levels that low, even America’s national parks would be in nonattainment. Under the best of conditions, the standards could be set so low that attainment in areas with no cars or industrial activity would be nearly unachievable.
Now is not the time to sacrifice millions of jobs and trillions of dollars in pursuit of dubious benefits and unreachable targets. The EPA should put on the brakes and allow the existing ozone standards to be implemented.