TESTIMONY OF ROBERT PERCIASEPE
OFFICE OF AIR AND RADIATION
U.S. ENVIRONMENTAL PROTECTION AGENCY
SUBCOMMITTEE ON CLEAN AIR, WETLANDS,
PRIVATE PROPERTY AND NUCLEAR SAFETY
COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
UNITED STATES SENATE October 14, 1999
Mr. Chairman and Members of the Subcommittee, I welcome the opportunity today to testify on our nation's progress under the Clean Air Act (the Act) toward achieving clean, healthy air for all Americans. My remarks reflect the perspective I have gained during my time at the U.S. Environmental Protection Agency (EPA), and also my experience as the Secretary of the Environment in Maryland, and as the first state chair of the Ozone Transport Commission.
It is important to remember that the Clean Air Act Amendments of1990 (the 1990 Amendments) passed with overwhelming support in both the House and Senate and set ambitious air pollution reduction goals. This bi-partisan legislation was designed to achieve real results -- and it has done so. I am pleased to report that this nation has substantially cut air pollution over the past nine years. We have made great strides in combating urban air pollution, toxic air pollution, depletion of the stratospheric ozone layer, and acid rain. But we still have a long way to reach our goal: clean air for every American.
I will start today by describing the substantial progress we've made since 1990 in reducing air pollution. I will then reflect on what we've learned about effective and efficient ways to achieve our goals -- including the benefits of stakeholder involvement, market-based policies, flexible, common-sense implementation, and the value of publicly available information. We also have learned that many predictions of high costs and infeasibility have not come to pass. In fact, for many air pollution problems, reductions have been made faster and at less cost than we ever expected. Finally, I want to bring you up to date on some of our key current efforts and talk briefly about whether the Clean Air Act should be reopened at this time.
PROGRESS TOWARD CLEAN AIR
To appreciate how far we have come in reducing air pollution, it is instructive to remember where we were before the 1990 amendments. There was growing concern about the increasing damage to the stratospheric ozone layer, which, among other things, protects us from skin cancer and cataracts. Acid rain essentially was unchecked, causing damage to aquatic life, forests, buildings and monuments, as well as visibility degradation and health risks from sulfate and nitrate particles. In 1990, photochemical smog, which can impair lung function, cause chest pain and cough, and worsen respiratory diseases and asthma, exceeded healthy levels in 98 metropolitan areas. Many cities did not meet the national air quality standards for the pollutant carbon monoxide, which can aggravate angina (heart pain), and also for particulate matter, which is linked to premature death, aggravation of pre-existing respiratory ailments, and reductions in lung capacity. The millions of tons of hazardous air pollutants emitted annually in the United States were largely unregulated at the federal level. Many of these pollutants have the potential to cause cancer or other serious health effects such as nervous system damage, miscarriages or birth defects.
Since then, the 1990 Amendments enabled us to substantially reduce each of the major air pollution problems that faced the United States:
- Annual sulfur dioxide emissions, which react to form acid rain, have been cut by more than 5 million tons, and rainfall in the eastern U.S. is as much as 25 percent less acidic.
- Production of the most harmful ozone-depleting chemicals has ceased in the U.S. and -- provided the U.S. and the world community maintain the commitment to planned protection efforts -- the stratospheric ozone layer is projected to recover by the mid 21st century.
- Ground-level ozone pollution, particulate matter, and carbon monoxide pollution have all been reduced significantly, producing dramatic decreases since 1991 in the number of areas in nonattainment.
- Rules issued since 1990 are expected to reduce toxic emissions from industry by 1.5 million tons a year -- eight times the reductions achieved in the previous 20 years.
These results have been achieved through a combination of rules, voluntary measures, market mechanisms, state partnerships, and stakeholder negotiations. Between 1990 and 1997, we reduced annual emissions of all criteria pollutants by 10 million tons. By 2010, rules already in place will have reduced these annual emissions by more than 30 million tons from the 1990 level.
REDUCING ACID RAIN
To combat acid rain, the 1990 Amendments called for a 10 million ton reduction in sulfur emissions, relative to a 1980 baseline. Much of that was to be achieved from utility power plants through an innovative market-based pollution allowance trading system. The results have been dramatic. So far, national sulfur dioxide emissions have been cut by more than 5 million tons, mostly through this program -- and at lower cost than predicted. As a result, rainfall in the eastern United States is up to 25% less acidic, and some ecosystems in New England are showing signs of recovery. Separate requirements for nitrogen oxides controls for utilities already have begun reducing those emissions, and will achieve a 2-million ton NOx reduction beginning next year.
Annual costs of the sulfur emissions program are now estimated to be less than half of what we projected in 1990 ($4 billion in 1990, $1 to $2 billion now). Trading has allowed the utility industry to minimize compliance costs, and has spurred competition in other sectors of the economy such as freight, coal, and scrubbers -- all of which has resulted in lower costs.
The rest of the 10 million ton reduction in SO2 will be achieved by 2010 through the second phase of the acid rain program. Recent research indicates that further reductions in SO2 and NOx emissions beyond those required by the acid rain program would be necessary for full recovery of the most sensitive ecosystems. The controls to achieve such reductions also would provide significant health benefits by reducing fine particulates.
PROTECTING THE STRATOSPHERIC OZONE LAYER
The global phase-out of chlorofluorocarbons (CFCs) and other ozone-depleting chemicals is an unparalleled triumph of the soundest science, economics, and diplomacy. It rests on an overwhelming consensus within the world science community. One hundred and sixty-eight nations have become parties to the Montreal Protocol, the treaty through which the phase-out policy is being implemented worldwide. The United States and the world have made significant progress to date in addressing the erosion of the earth's protective ozone layer by eliminating many manmade ozone-depleting chemicals. Production of the fire-extinguishing halons was virtually eliminated by the world's developed countries in 1994 and at the beginning of 1996, developed country production of CFCs, methyl chloroform, and carbon tetrachloride ended, thus avoiding emissions of 400,000 metric tons of ozone-depleting substances. As a consequence of these prudent international actions, the rate of increase of atmospheric concentrations of ozone-depleting chemicals has slowed, and in some cases, declined. In 1998, more than 100 scientists worldwide collaborated in a scientific assessment of the state of the ozone layer. These scientists concluded that the Montreal Protocol is working. Reductions in concentrations of ozone-depleting compounds already have been measured in the atmosphere, and scientists predict the gradual recovery of the ozone layer by the mid-21st century.
This unprecedented international success story also will contribute substantially to the health of all Americans. EPA estimated in 1992 that the phase-out would reduce U.S. incidences of non-melanoma skin cancer by 295 million during the period 1989 through 2075, as well as protect people from eye damage leading to cataracts, and immune system suppression.
The phase-out used a market trading approach developed by EPA that has served as a model for programs in other countries. Because of strong partnerships with industry and the flexible market approach, the phase-out was much less expensive than was predicted at the time the 1990 Clean Air Act Amendments were passed. In 1988, EPA estimated that a 50% reduction of CFCs by 1998 would cost $3.55 per kilogram. In 1993 the cost for a 100 percent phase-out by 1996 was down to $2.45 per kilogram.
HEALTHIER AIR IN MORE CITIES
The air in our nation's cities is substantially cleaner than in 1990. Nationally, the 1997 average air quality levels were the best on record for all six common pollutants (lead, NO2, SO2, PM10, CO and ozone) subject to air quality standards. The 1998 levels were as good or better for all pollutants except ozone. These improvements have occurred along with growing population, strong economic growth and continued growth in vehicle miles traveled. From 1970 to 1997, U.S. Gross Domestic Product has grown by 114%, the U. S. population has grown by 31%, and the number of miles traveled by on-road vehicles (VMT) has increased by 127%.
Since 1993, an unprecedented number of cities have met the health-based national ambient air quality standards. For example, of the 42 carbon monoxide areas designated as nonattainment in 1991, only 6 areas continue to experience unhealthy levels of CO (based on 1996 -1998 data). Much of the progress on CO can be attributed to the Clean Air Act's wintertime oxygenated fuels program, which began in 1992 in 30 cities.
Although we continue to experience unhealthy levels of ozone and particulate matter, we have made substantial progress even with those pollutants. The 1996 to1998 data for particulates indicates that 71 of the original 85 nonattainment areas have air quality meeting the PM10 standard. Average particulate levels (PM-10) dropped 25 percent from 1989 to 1998. Because we now believe that the finer particles pose the greatest health concern, we are working with states to get monitoring systems in place for fine particulate matter (PM 2.5). In the case of ground-level ozone, based on 1996 to 1998 data, 62 of the original 98 ozone nonattainment areas have air quality levels meeting the 1-hour ozone standard.
For the other three criteria pollutants, few areas remain in nonattainment. The remaining lead and sulfur dioxide nonattainment areas in the country are the result of localized point sources for which action on an individual basis is being taken. The nitrogen dioxide standard is now met nationwide. The last nitrogen dioxide nonattainment area, Los Angeles, met the standard in 1992 (and was redesignated to attainment in 1998).
CLEANER CARS, CLEANER FUELS
A key reason for the air quality improvements we are seeing is that the 1990 Amendments called for cleaner motor vehicles and cleaner fuels, in recognition of the important role that motor vehicle emissions play in affecting air quality.
Today, the average new car (meeting Tier I standards in the 1990 Amendments) is 40 percent cleaner than the average new car was in model year 1990. Cars now have onboard canisters to control refueling vapors, and onboard diagnostic computers to identify emission control problems.
In 1997, EPA mediated an agreement among the states, U.S. auto companies, and other stakeholders that calls for automakers to produce cars 50% cleaner than today's Tier I cars, which began in eight Northeastern states in model year 1999. In addition to covering passenger cars, the agreement covers the majority of sport utility vehicles, minivans, and light-duty trucks, which have higher emissions than cars. Automakers voluntarily agreed to meet the tighter standards on an enforceable basis. The agreement benefits car companies by avoiding a potential patchwork of differing state emissions requirements. It benefits states and the public by delivering cleaner cars five years sooner than EPA could otherwise have required. These vehicles will be available nationwide in model year 2001.
While requiring cleaner cars, the 1990 Amendments also required cleaner gasoline. To reduce smog-forming VOCs and toxics, the 1990 Amendments required cleaner, reformulated gasoline in the worst ozone areas, and allowed additional areas to join the program. Today, 30 percent of the country's gasoline consumption, in 18 states, consists of reformulated gasoline, or RFG. Overall, refiners have gone beyond the 15% reduction in VOCs and toxics required by the Act beginning in 1995. Refiners' data now tell us that VOC reductions are 8 percent greater than required on average, and toxic reductions almost twice the required amount. In those RFG areas where we measured, levels of benzene in the air were down 43% from 1994 to 1995. This is exciting progress since benzene is a known human carcinogen that has been linked to leukemia. One of the attractive features of this program is that reductions of pollutants are immediate because cleaner fuels can be used in any car on the road today. Phase II of the RFG Program will begin in January 2000.
Buses and trucks also are getting cleaner. Diesel-powered urban transit buses being built today release almost 90 percent fewer particulate emissions than buses built in 1990. As a result of EPA emissions standards for new buses, smoke-belching buses will disappear as old buses are retired from service. Emissions control will be required for older urban buses that have their engines replaced or rebuilt. Under rules issued in 1997, NOx emissions from heavy-duty diesel engines used in trucks and buses will be cut in half by 2004, assisting with efforts to reduce smog and particulates. In addition, substantial emissions reductions are being achieved for the first time through a set of standards for a variety of engines not used in highway vehicles -- including locomotives, bulldozers, commercial and recreational marine vessels and lawn and garden equipment.
In addition to the very substantial reductions in ozone precursors, all of the programs put in place since 1990 to control emissions from motor vehicles will reduce total vehicular air toxics emissions by approximately 40 percent.
CUTTING INDUSTRIAL AIR TOXICS
Since 1992, EPA has issued 43 pollution standards affecting 70 industrial categories such as chemical plants, dry cleaners, coke ovens, and petroleum refineries. When fully implemented, these standards will eliminate over 1.5 million tons of air toxics and over 2.5 million tons of particulate matter and smog-causing volatile organic compounds.
By contrast, in the preceding twenty years only seven hazardous air pollutant standards, eliminating 125,000 tons of toxics, had been put in place. One of the main reasons was that the toxics provisions of the 1970 Act triggered contentious debates and litigation over risk assessments and "how safe is safe." Congress resolved this in 1990 by directing EPA to issue technology- and performance-based standards on a source category basis to ensure that major sources of air toxics are well controlled. These standards create a level playing field by requiring all major sources, in essence, to achieve the level of control already being achieved by the better performing sources in each category.
The result is that we are reducing the large quantities of toxic air pollutants released into our air, in the aggregate and around industrial sources in populated areas. We will achieve additional reductions as we complete standards for more categories of major pollution sources. We are now in the early stages of implementing the second phase of the air toxics program outlined by the 1990 Amendments, targeting particular problems such as elevated risks in urban areas, deposition of air toxics into the Great Lakes, mercury emissions, and residual risks from already controlled sources.
IMPROVING VISIBILITY IN OUR NATIONAL PARKS AND WILDERNESS AREAS
In July, EPA published a new rule calling for long-term protection of and improvement in visibility in 156 national parks and wilderness areas across the country. These areas include many of our best known and most treasured natural areas, such as the Grand Canyon, Yosemite, Yellowstone, Mount Rainier, Shenandoah, the Great Smokies, Acadia, and the Everglades. Regional haze, created by fine particles and other pollutants, degrades vistas in these parks and regionally across the nation. For example, on some days air pollution reduces visibility to less than 10 miles in our eastern parks.
The regional haze program is designed to improve air quality in the parks, particularly on these poor visibility days. Because haze is a regional problem, EPA is encouraging states to work together in multi-state planning organizations to develop potential regional strategies for the future. EPA will be working closely with these multi-state organizations, to provide guidance during this process, just as it did with the many states and Tribes involved in the Grand Canyon Visibility Transport Commission.
During the period 2003-2008, states are required to establish goals for improving visibility in each of these 156 areas and adopt emission reduction strategies for the period extending to 2018. States have flexibility to set these goals based upon certain factors, but as part of the process, they must consider the rate of progress needed to reach natural visibility conditions in 60 years. To assist in evaluating regional strategies and tracking progress over time, we are working with the states and federal land managers to expand our visibility and fine particle monitoring network to 110 of these areas over the next several months.
WHAT WE'VE LEARNED: INNOVATIVE STRATEGIES AND STAKEHOLDER INVOLVEMENT
These impressive results have come about through involving stakeholders from the outset, using innovative and flexible environmental protection strategies, and adjusting when programs need improvement.
Since 1990, the Agency has dramatically expanded its interaction with stakeholders. Consensus is not always attainable, of course. But the time and effort we put into communication and consensus-building pays off in better rules, and often in smoother implementation.
One of the first examples of stakeholder involvement was the Acid Rain Advisory Committee, an intensive seven-month effort with stakeholders immediately after the 1990 Amendments that helped shape the rules for the successful acid rain program. This positive experience led to establishment of the Clean Air Act Advisory Committee, a standing group of several dozen experts from industry, the environmental community, states, academia and elsewhere. We seek the advisory committee's insights frequently.
Two large stakeholder involvement efforts were the Ozone Transport Assessment Group (OTAG) process and the National Ambient Air quality Standards (NAAQS) implementation advisory committee process. OTAG, which involved 37 states, EPA, and many stakeholders, conducted state-of-the-art modeling to improve understanding of the interstate ozone transport problem in the East, and laid the groundwork for our ongoing efforts to institute regional controls on NOx emissions. EPA supported OTAG, which was led by the Environmental Council of States, with significant technical and financial assistance. The NAAQS Federal Advisory Committee Act (FACA) process, convened by EPA, provided us with insights on ways to implement the 1997 ozone and PM NAAQS even before those standards were promulgated.
Since 1990, we typically have involved stakeholders earlier in rulemaking efforts than we did before that time. In the case of air toxics standards, for example, we realized that working with stakeholders early in the process would be a necessity if we were to meet the Act's requirement to produce standards for the long list of industrial source categories. We developed a "MACT partnering" process that allows EPA, state and local air quality agencies to work cooperatively with industry and local organizations to collect information on emissions and controls, and to develop a draft determination of the level of control. Similarly, we have engaged stakeholders in substantive discussions prior to developing proposed mobile source rules -- for example, in developing rules to control emissions from heavy-duty trucks and buses. The National Low Emission Vehicle Program is another example of what can be achieved through consensus building with stakeholders when incentives for agreement exist.
Since 1990 we have emphasized using new approaches to achieve more environmental protection at less cost. We have made increasing use of market-based approaches to cut compliance costs, promote technology development and achieve extra environmental benefits. We also have looked for other ways to provide flexibility on the means of achieving emissions reductions, while ensuring accountability. We are making use of new information technologies to improve public information on air quality, and are providing compliance assistance to small businesses.
Emissions averaging and trading are frequently used as standard tools of the air program. Beyond the stratospheric ozone and acid rain programs, we have provided trading opportunities in many national air rules for vehicle manufacturers and fuel refiners. The most recent example is the proposed Tier II/gasoline sulfur rule, which would allow averaging, banking and trading to provide additional flexibility to vehicle manufacturers and fuel providers. Emissions averaging is permitted by national air toxics emissions standards for refineries, chemical plants, aluminum production, wood furniture and other sectors that use coatings. We also have used other methods, including multiple compliance options, to help provide flexibility in air toxics rules.
In addition to providing flexibility in national rules through trading and other means, EPA is working with states to promote market-based approaches to help achieve national air quality standards for smog, particulates and other criteria pollutants. EPA has issued guidance to assist states in designing trading and other economic incentive programs to reduce criteria pollutants, and will soon update that guidance. EPA also has assisted states in setting up trading programs, such as California's RECLAIM program for reducing sulfur dioxide and nitrogen oxide emissions and the Ozone Transport Commission's program for controlling nitrogen oxide emissions among states in the Northeast. Through a unique state-EPA partnership, we are jointly implementing this NOx budget system for the Northeast.
In issuing NOx budgets for 22 states and the District of Columbia to reduce the problem of transported ozone pollution in the East, we provided a model cap-and-trade rule for utilities and large industrial sources. The experiences of the acid rain program and the OTC effort show that this approach holds the potential to achieve regional NOx reductions in an efficient and highly cost-effective manner.
The air program is striving to provide flexibility and create incentives for reducing emissions in a variety of ways. A number of air toxics rules -- including those addressing polymers and resins, primary aluminum, and pharmaceuticals manufacturing -- provide companies the opportunity to reduce reporting requirements if they achieve consistent good performance. We have issued guidance to allow states to count voluntary measures to reduce emissions from transportation sources -- such as ridesharing programs and ozone action days -- toward their state planning requirements under the Act.
This is the information age, and we are finding ways to use the new information technologies to provide citizens with environmental information they can use. Here are three examples:
- The Ozone Mapping Project, or AIRNOW, provides the public for the first time with real-time information about smog levels in their communities via color-coded maps and animations. These maps are made available on an Internet website and for local TV weather reports.
- E-GRID, the Emissions & Generation Resource Integrated Database, is a right-to-know tool for anyone interested in emissions or fuel mix of any portion of the nation's electric power grid. It combines in one database information from EPA and the Energy Information Administration on power generation, fuel information and measured emissions.
- The EPA funded SUNWISE Schools Program is building a national UV monitoring and education network within U.S. elementary schools. Using the Internet, students report the UV Index, a daily forecast of UV radiation levels people might experience, and recommended UV-protective behaviors. This innovative approach to sharing real-time environmental information with the public is a helpful tool in protecting the health of our children from overexposure to UV radiation while the ozone layer recovers.
Another information-related development during the 1990s is the establishment of Clean Air Act small business technical assistance programs and small business ombudsmen in every state. These programs help small businesses comply with the Clean Air Act by providing free technical assistance. In 1997, state programs directly assisted over 78,500 businesses and conducted almost 6,000 on-site consultations for a wide variety of industry sectors. To cite one success story: One Texas furniture company, after consulting with the state, invested $8,000 in more efficient, high-volume, low-pressure spray guns and related equipment and trained employees in their proper use. These guns spray more of the paint onto the product and less onto the floor and into the air. As a result, the firm's smog-forming VOC emissions dropped from just under 25 tons in 1996 to 16 tons in 1998, while its annual spending on paint and coatings fell from $69,000 to $35,000.
In addition to these efforts, we have worked to continually refine and improve our implementation programs. The following examples show our willingness to make adjustments when programs need improvement.
We recently overhauled our long-established process for evaluating whether new cars and light-duty trucks meet emissions standards. The revised rules will save auto manufacturers an estimated $55 million annually, while providing better information on whether cars on the road are continuing to meet the standards. The vehicle emission Compliance Assurance Program, or CAP 2000, redirects the focus of EPA and automakers from pre-production laboratory demonstrations to verification of actual in-use performance. This reduces paperwork by 50 percent, as well as saving valuable pre-production time. In exchange, industry will conduct extensive emissions testing of vehicles "in use" on a broader scale than the government could conduct. This will give automakers substantial incentives to ensure that their vehicles meet the standards in actual use.
We are moving forward in our efforts to improve the new source review permitting program. This program ensures that pollution from the addition of major new and modified sources does not significantly degrade the air quality in clean air areas, and that the national ambient air quality standards in non-attainment areas can be achieved. A key objective of our efforts is to streamline permitting without sacrificing environmental and other benefits of the current program. The new source review reform package will provide options for sources and states to adopt more flexible approaches to meet new source review requirements so that companies can plan and implement anticipated changes at their facilities with a greater degree of regulatory certainty. Concurrently, some of the reform measures will enhance environmental protection in some of the nation's most sensitive Class I areas, which include many of our national parks. We are nearing completion of an intensive set of stakeholder meetings that we expect will be very helpful when finalizing the reform package. Our schedule for finalizing the rule has been reset for spring 2000 to allow us to evaluate what we have learned from recent interactions with stakeholders.
To address concerns raised about the Title V operating permits program, we issued two guidance documents that streamlined and simplified permit applications and helped with the large job of issuing initial permits to all covered facilities. We also continue to work toward finalizing a proposed permit revisions rule, where we are working closely with stakeholders to avoid unnecessary permit revision delays for industry while addressing citizens' interest in public review of significant changes.
We continue to develop and test innovative ways to allow companies to adjust quickly to market demands without experiencing permitting delays. To date, we have worked with companies and states on approximately a dozen permits designed to provide operational flexibility and promote pollution prevention. Three permits have been issued to date and eight more are in progress.
For example, working in conjunction with EPA and other stakeholders, the Intel Corporation was able to develop a flexible permit that allowed the company to receive advance approval for several types of operational changes at its facility in Oregon. As a result, Intel was able to avoid permitting delays and significant staff time. Additionally, Intel cut its air emissions in half while doubling production on site. We are also planning to document the lessons learned from these permits so that successful flexible permitting approaches can be replicated throughout the country.
WHAT WE'VE LEARNED: PREDICTIONS ABOUT INFEASIBILITY AND COST
Throughout the history of the Act, some critics have made dire predictions about the infeasibility of proposed controls or the negative impact that the Clean Air Act would have on industries, jobs and the U.S. economy. Nearly nine years after the 1990 amendments, we have achieved progress in cleaning the air without the severe dislocations predicted by some critics. Experience shows that progress toward clean air and economic growth can go hand in hand. For example, data from the Bureau of Economic Analysis shows that between 1990 and 1995, there was a net gain of 2.2 million jobs in ozone nonattainment areas (a few were excluded due to data constraints).
REVIEWING THE RECORD
Costs of the 1990 Amendments are proving to be far less than initial industry estimates. For example:
- The Clean Air Working Group, a key industry lobbying group during the 1990 reauthorization effort, estimated in August 1990 that compliance costs would total $51 billion to $91 billion annually. Today, with the benefit of the added information from several years of implementation, EPA estimates the annual cost at $26.8 billion upon full implementation of the law in 2010.
- An industry study in 1989 predicted the cost of fully implementing an acid rain program at $4.1 billion to $7.4 billion. More recent estimates by EPA and the U.S. General Accounting Office were approximately $2 billion, and estimates from independent economists and industry researchers range as low as $1 billion.
- In 1993, industry estimated that meeting the Act's requirements for reformulated gasoline would add 16 cents to the price of a gallon of gas. In 1995, the year the program took effect, an Energy Information Administration survey found the actual cost was 3 cents to 5 cents per gallon.
Another concern of industry representatives during the 1990 reauthorization was that it would be technologically infeasible to comply with some requirements. For example, a chemical company spokesman testified that accelerating the phase-out of ozone-depleting CFCs to January 1996 would cause severe economic and social disruption. At the same hearing, a refrigeration industry representative testified, "We will see shutdowns of refrigeration equipment in supermarkets....We will see shutdowns of chiller machines, which cool our large office buildings, our hotels, and hospitals." In fact, the phase-out of CFC production was accomplished without such disruptions. Chemical companies helped make this possible by rapidly developing alternatives to CFCs.
Similarly, a major American auto company representative in 1989 testified that "we just do not have the technology to comply" with the initial Tier I tightening of tailpipe standards that became part of the 1990 amendments. Nonetheless, the auto industry was able to begin producing vehicles meeting the standards in 1993. More recently, as previously mentioned, the auto industry entered into a voluntary agreement with EPA and states to produce even cleaner, low emission vehicles that are already being sold in some areas.
As these examples begin to illustrate, Clean Air Act requirements have created market opportunities and pressures for technology breakthroughs and performance improvements. Over and over again, industry has responded with great success, producing breakthroughs such as alternatives to ozone-depleting chemicals and new super-performing catalysts for automobile emissions. The result has been affordable improvements in air quality across the country, in conjunction with continued economic and population growth. There are many examples of technologies that were not commercially available 10 years ago, but that now are important parts of pollution control programs. Some of these include reformulated gasoline, selective catalytic reduction for NOx emissions from power plants, and cleaner-burning wood stoves. This pattern of technological progress is continuing today. EPA has identified a number of emerging technologies -- ranging from fuel cells to ozone-destroying catalysts to new coating technologies -- that may hold promise for achieving additional cost effective reductions of VOC, NOx and particulate matter.
BENEFITS V. COSTS
Some have charged that the osts of the Act exceed its benefits. But the most exhaustive study of this issue to date, an EPA study required by Congress, finds otherwise.
Under section 812 of the 1990 amendments, we are required to assess the costs and benefits of the Act, first retrospectively and then with an ongoing series of prospective studies. The retrospective study, published in October 1997, included estimates of the number of incidences of health effects avoided in one year -- 1990 -- due to Clean Air Act pollution reductions. Here are estimates for a partial list of the avoided health effects:
- 184,000 incidences of premature mortality and 8,700,000 incidences of acute bronchitis related to particulates;
- 10,400,000 lost IQ points and 12,600,000 incidences of hypertension related to lead;
- 68,000,000 incidence-days of shortness of breath, 850,000 incidences of asthma attacks, and 130,000,000 incidences of 19 acute respiratory-related symptoms related to particulates and ozone;
- 39,000 incidences of congestive heart failure related to particulates and carbon monoxide; and
- 22,600,000 lost work days related to particulates, and 125,000,000 days with restricted activity due to particulates and ozone.
The section 812 retrospective study found that the 1970 and 1977 Clean Air Acts yielded human health, welfare and environmental benefits that exceeded costs by more than 40 to 1 ($22.2 trillion versus $523 billion). Even at the low end of our range of estimates, monetized benefits exceeded costs by a margin of 11 to 1. EPA is now nearing completion of the first prospective study examining the incremental value of the 1990 amendments. Separately, EPA completed a cost/benefit assessment of the acid rain program in 1995, and found the health benefits alone far exceeded annual costs.
It is important to note that the section 812 and acid rain studies determined that monetized benefits substantially exceeded costs even though many benefits could not be translated into dollars. Even with continuing progress in scientific and economic research, more than half of the known adverse effects of air pollution still cannot be expressed in economic terms. For ozone, some of the examples cited in the 812 study include lung inflammation, chronic respiratory diseases, immune system changes, forest and ecological effects, and materials damage. Given this problem, it is important not to judge the value of additional environmental and public health protections solely on the basis of monetized costs and benefits.
This is one reason for EPA's consistent position that cost-benefit analysis should not be the basis for our air quality standards. We continue to believe that our national air quality standards represent important health-based goals for the nation, and a benchmark for citizens interested in whether their air is safe to breathe. Although air quality standards are set solely on the basis of protecting health, we of course agree that cost is important to consider in devising environmental protection strategies. Costs are taken into account in implementation of the standards, as states and EPA make decisions on how to reach the goal.
WHERE WE STAND TODAY: UNFINISHED BUSINESS
As you know, we received an adverse federal court decision in May that has stalled implementation of the new, more protective health standards EPA established in 1997 for ozone and fine particulate matter. A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit remanded EPA's action on the two standards, challenging EPA's legal rationale as well as EPA's authority to enforce any new ozone standard under the 1990 amendments. The court did not challenge the underlying science. In light of the executive branch's strong disagreement with the ruling, the Department of Justice filed a petition for rehearing by the full court on June 28, 1999. We await the court's decision on whether to rehear the case.
We continue to believe these standards are essential for protection of public health, and ultimately will be implemented. We recognize, however, that it will take some time for the legal issues to play out.
In the meantime, the Administrator and I are determined to keep emission reduction efforts on track and to reduce health threats from smog and particulate matter. We are concerned that progress on the smog problem appears to have slowed or stopped in a number of areas in the last couple of years -- and in some areas, we are in danger of backsliding. The national average ozone level increased 5 percent in 1998. Also, in recent summers we have seen increases in the number of times air quality exceeded national standards in certain cities and national parks, particularly in the East.
Partly because of this concern, this Administration, in partnership with states, is taking several actions to ensure that we continue making progress. Specifically:
- Tier II/Gasoline Sulfur. We are on track to issue more stringent Tier II emissions standards for cars and light-duty trucks along with rules to cut levels of sulfur in gasoline. Many metropolitan areas need the emissions reductions from these rules to achieve healthy air. These rules will cut emissions that contribute to ground-level ozone pollution and particulate matter, acid rain, crop damage and reduced visibility.
- Regional NOx Reductions. We will soon take final action on petitions from eight northeastern states calling upon EPA to impose NOx controls on power plants and large industrial combustion sources in 12 upwind states. This action would reduce long-range transport of NOx and ozone pollution that is contributing to nonattainment problems downwind, as well as reducing pollution in states where the sources are located. EPA also will propose action on four petitions it has recently received from Delaware, Maryland, New Jersey and the District of Columbia.
Last October, EPA issued the NOx state implementation plan (SIP) call rule requiring 22 eastern states and the District of Columbia to cut NOx emissions to reduce transported ozone pollution that is contributing to nonattainment problems throughout that region. States have relied on those reductions in devising their attainment plans for serious and severe ozone areas. However, shortly after issuing its NAAQS opinion, the court of appeals for the D.C. Circuit stayed the deadline for states to submit plans for complying with the NOx SIP call pending further order of the court. Oral arguments in the litigation are set for November 9.
- Ozone Attainment SIPs. For 10 serious and severe ozone nonattainment areas, EPA currently is assessing state plans for demonstrating attainment of the one-hour ozone standard. It appears that many of these areas will need to commit to additional emissions control measures and/or make other improvements in their plans before these plans are approvable. EPA tentatively plans to propose action on these plans in late November.
- Heavy Trucks and Buses/Diesel Sulfur. Just last week Administrator Carol Browner announced a strategy to reduce by more than 90 percent harmful levels of smog-causing NOx and particulate matter, or soot, from heavy duty trucks and the very largest sport utility vehicles. The strategy includes a plan to produce cleaner diesel fuel.
In addition, we are seriously considering reinstating the old one-hour ozone standard nationwide. Since issuing the more protective 8-hour ozone standard, EPA has revoked the one-hour standard in much of the country (wherever ozone levels met the old standard). But the court opinion now leaves much of the nation without an adequately enforceable standard for ground-level ozone pollution to guard against deterioration in air quality. We are concerned about that possibility in light of recent air quality data.
Looking more broadly to the future, we see implementing the 1997 fine particulate standard as an integrating strategy that is key to making progress on multiple pollution problems. From a health standpoint, particulate matter is a priority because of its serious health effects. But there are other benefits to controlling pollutants that react in the atmosphere to form particulate matter -- specifically, sulfur dioxide and nitrogen oxides. These measures also will reduce ozone pollution, air toxics, acid rain, regional haze and visibility impairment in our national parks, and nitrogen eutrophication of coastal waters. In contrast to other pollutant trends, NOx emissions are higher than in 1970. Given the important contribution NOx makes to multiple environmental problems, we need to bring these emissions down.
In the air toxics arena, we are looking ahead to working with states and localities to implement the new Integrated Urban Air Toxics Strategy, issued in July. This strategy provides a framework for addressing the multiple sources of air toxics that together emit a combination of pollutants into our urban air. As you know, EPA has and will continue to develop national standards for stationary and mobile sources that improve air quality in both urban and rural areas. This new component of the national air toxics program includes plans for further reductions in toxic air emissions in urban areas, targeting 33 pollutants that pose the greatest health threat in those areas. Also included are assessment activities to improve our understanding of the health and environmental risks posed by toxics in urban areas.
Regarding the question whether it is time to re-open the Clean Air Act, it is important to ask if the law is still on target given today's air quality needs. We believe the law is still on target. Because the 1990 Amendments were so forward-thinking and comprehensive in scope, it established this country's air pollution agenda for well into the next century.
Because the Act is still relevant for today's needs, and because we are at a critical stage in implementation on a number of issues, we should carefully consider the implications of reopening the Act at this time. History shows that reauthorization of the Clean Air Act is a long and difficult task. The last time around, reauthorization efforts first began in 1981, and did not culminate until 1990. This reflects the fact that many parts of our society have a strong stake in the Act, and it can take intensive efforts to find common ground on a large number of issues. There is no guarantee that a reauthorization effort could be limited to a few issues. Many groups would promote proposals they believe should be a high priority. Although the Subcommittee would be pressed by some interests to pare back the requirements of the Act to cut costs, we can also be sure there there will be efforts to strengthen the Act and broaden its authorities, to ensure that we deliver on the promise of clean air for every American.
We are prepared to work with the Subcommittee on a process of reviewing the Clean Air Act to consider where it might benefit from improvements. An example of an issue that this process could examine is whether the Act should provide EPA with direct authority to establish multi-state cap-and-trade programs and other incentive-based programs to address regional problems for any pollutant. This would avoid the need for each state separately to enact compatible trading programs. Let me stress that once this review process is completed, we must assess whether reopening the Act would be more helpful or more disruptive on the whole.
It is imperative to continue the work that already is in motion. The best way to do that is to stay focused on the goal and work with everyone affected by the Act. This has and will continue to dramatically improve our ability to find sensible, cost-effective solutions to implementation hurdles and minimize the need for statutory changes. This approach takes time and patience, and sometimes the process is frustrating, but it has proven to pay off with sensible policies and environmental results.
Thank you. I would be happy to answer any questions that you may have.