Study: Proposed EPA Ozone Regulation Costliest in U.S. History

Penny Starr | August 8, 2014 | 8:27pm EDT
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FILE - In this June 2, 2014 file photo, a hill of coal is seen at the North Omaha Station, a coal-burning power station, in Omaha, Nebraska. (AP Photo/Nati Harnik, File)

( – A study commissioned by the National Association of Manufacturers (NAM) on the impact of a proposed Environmental Protection Agency (EPA) regulation shows that it could be the costliest federal rule by reducing the Gross National Product by $270 billion per year and $3.4 trillion from 2017 to 2040 and adds $2.2 trillion in compliance costs for the same time period.

The study, conducted by the National Economic Research Associates Economic Consulting, also predicts that reducing the parts per billion ozone standard from the current 75 to 60 could result in 2.9 million fewer job equivalents (total labor income change divided by the average annual income per job) each year on average through 2040, and increase energy costs from manufacturers and consumers.

“This regulation has the capacity to stop the manufacturing comeback in its tracks while imposing $270 billion in annual costs to our economy,” Jay Timmons, CEO and president of NAM said on its website announcing the July 31 release of the study.

“Proposed levels of reduction to 60 parts per billion would leave nearly all of the United States in a so-called ‘non-attainment’ zone, ending the manufacturing boon, restricting development of our resources and driving up the cost of nearly every manufactured product,” Timmons said.

At an event for reporters on Friday, the American Petroleum Institute introduced a map it has produced showing how the new regulation would harm the economy in states across the country.

API also claims that the nation’s air quality is improving and health benefits from the lower ozone standards are not backed by the science.

“The nation’s air quality has improved over the past several years, and ozone emissions will continue to decline without new regulations,” the API analysis of the NAM study stated. “These new standards are not justified from a health perspective, because the science is simply not showing a need to reduce ozone levels.”

“We are rapidly approaching a point where we are requiring manufacturers to do the impossible,” Ross Eisenberg, NAM vice president of energy and resources policy, said of the EPA proposal. “The EPA is considering setting ozone levels below what exists at national parks, such as Yellowstone and Denali.

“It is vital that the Obama Administration allow existing ozone standards to be implemented rather than move the goalposts with another set of requirements for manufacturers,” Eisenberg said. “Trillions of dollars are at stake.”

The EPA is expected to announce the rule in December.

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