Rio Grande Foundation submits comments to EPA on proposed Ozone regulations

In case you don’t already know, the Obama Administration has proposed yet another round of regulations, this time on ozone. The American Petroleum Institute says this set of regulations could be “the most expensive ever” with losses to New Mexico’s economy totaling $1.6 Billion Gross State Product Loss from 2017 to 2040 and 7,380 Lost Jobs or Job Equivalents per year. This is higher than for most states because of their impact on the oil and gas industries.

The EPA is collecting comments on the regulations through March 17. See the comments below the image below which illustrates the expected impact of the proposed regulations.

Dear Administrator McCarthy:

The Rio Grande Foundation is a New Mexico-based policy research organization based in Albuquerque, NM. Our state’s economy has struggled for several years now and we are deeply concerned about the Environmental Protection Agency’s (EPA) recently proposed rule to make ozone standards more stringent. These new regulations could have a negative impact on our state’s still struggling economy.

Ozone standards at the levels considered in EPA’s proposal could push virtually the entire country into “nonattainment” – where local communities face burdens to commercial and industrial activity not only vital to creating jobs, but also to providing tax revenue that support important local services like public safety and education. This proposal’s hardship to the American worker is real and immediate, while the benefits are unverified and uncertain. Therefore, Rio Grande Foundation strongly urges you to retain the current ozone standard when finalizing this proposal.

All of us and our families breathe the same air. We are proud that emissions of ozone-forming emissions have been cut in half since 1980, leading to a 33% drop in ozone concentrations. Moreover, EPA just updated ozone standards six years ago. These current standards are behind schedule due to EPA effectively suspending their implementation from 2010-2012 while the Agency unsuccessfully pursued reconsideration. This country can expect to see even greater reductions in ground-level ozone as states make up lost ground in putting the current standards into effect.

Indeed, states are currently committing substantial resources – both in time and money – towards achieving emissions reductions under those current ozone standards. Yet despite over three decades of cleaner air and before states can catch up with EPA’s delays in implementing existing ozone standards, EPA is now proposing a new stringent range of standards from 70 to 65 parts per billion that would bring vast swaths of the country into nonattainment. In some areas, this proposed range is at or near the level of background ozone that is naturally occurring or internationally transported, pushing even remote counties far from industrial activity into nonattainment. According to EPA data, even the Grand Canyon and Yellowstone National Parks would fail the proposed ozone standards.

If finalized, EPA’s proposed stringent ozone standards could limit business expansion in nearly every populated region of the United States and impair the ability of U.S. companies to create new jobs. EPA’s proposed range would immediately add red tape to companies seeking to grow even in areas that can attain those standards. The Clean Air Act carries even stiffer consequences for nonattainment areas, directly impacting economic vitality of local communities and making it difficult to attract and develop business. Increased costs associated with restrictive and expensive permit requirements would likely deter companies from siting new facilities in a nonattainment area. Making America a less attractive place to do business in this way risks shipping jobs overseas.

Companies building a new facility or performing major modifications to certain existing facilities resulting in increased ozone concentrations in, or near, a nonattainment area will be required to meet the most stringent Clean Air Act standard by installing the most effective emission reduction technology regardless of cost. As well, states are mandated to offset any ozone-forming emissions from new projects or projects undergoing major modifications by reducing emissions from other existing sources in a nonattainment area. If no party is willing to provide offsets, then the project cannot go forward. This offset can be a 2-to-1 ratio in certain situations. Nonattainment designation also has profound impact on infrastructure development vital to the business community. Beginning one year from the date of the nonattainment designation, federally-supported highway and transit projects cannot proceed in a nonattainment area unless the state can demonstrate that the project will cause no increase in ozone emissions.

These restrictions do not disappear when an area finally comes into attainment. Instead, former nonattainment areas face a legacy of EPA regulatory oversight. Before a nonattainment area can be redesignated to attainment, EPA must receive and approve an enforceable maintenance plan for the area that specifies measures providing continued maintenance of ozone standards and contingency measures to be implemented promptly if an ozone standard is violated.

Stringent ozone standards may have severe unintended consequences for public health. Studies show that by increasing the costs of goods and services such as energy, and decreasing disposable incomes, regulation can inadvertently harm the socio-economic status of individuals and, thereby, contribute to poor heath and premature death.

Sincerely,

Paul J. Gessing
President

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