Groups Cite Flaws In EPA's Coal-Ash Recycling Cost-Benefit Analysis

Dec 29: Two years after the Kingston, TN coal ash spill, Federal action to regulate coal ash dumps is being held up by concerns that stricter standards would depress markets for coal-ash recycling. "Cost-benefit" analysis estimates prepared by the U.S. EPA claim that coal ash recycling is worth more than $23 billion a year, based on the annual life-cycle benefits of avoiding pollution and reducing energy costs. However, a review conducted by the independent and nonprofit Environmental Integrity Project (EIP), Earthjustice, and the Stockholm Environment Institute's U.S. Center (based at Tufts University) indicates that the EPA estimate is more than 20 times higher than the $1.15 billion that the U.S. government's own data shows is the correct bottom-line number.

    The groups say that the deep flaws in the EPA cost-benefit analysis appear to have escaped scrutiny at the White House Office of Management and Budget (OMB), which required EPA to include a weaker coal-ash proposal favored by utilities and some coal ash recyclers. The three groups said, "Common sense and past experience indicate that stricter standards for disposal will work to increase, rather than decrease, recycling. But either way, EPA ought not to be intimidated into adopting weak rules based on grossly inflated values for coal ash recycling."

    The groups said the analysis shows that the huge discrepancy is due to several factors, including double counting of pollution reductions that the EPA has already claimed would occur separately under Clean Air Act rules adopted in August 2010; overstated emission levels from cement kilns; and unrealistic assumptions about potential energy savings from reducing energy consumption at cement kilns and gypsum plants. They said EPA's cost-benefit analysis also neglects to account for many of the quantifiable benefits that would result from stricter standards, and puts an enormous dollar value on the so-called 'stigma' that would supposedly attach to coal ash recycling by virtue of regulating disposal sites. These economic assumptions are haphazard, unsupported by the record, and designed to slant the playing field against regulations that are based on protecting the public's health.

    Frank Ackerman, senior economist, Stockholm Environment Institute said, "We found numerous errors, large and small, in EPA's cost-benefit analysis of the proposed rules. Once we corrected those errors, the strict regulatory option is the clear winner. The only argument for the weaker option is industry's unsubstantiated claim that strict regulation of ash disposal would cause immense, long-lasting harm to the market for ash recycling. In reality, strict regulation of disposal would make recycling more attractive, not less."

    Back in October 2010, U.S. Representative Fred Upton (R-MI), the new Chairman of the House Energy and Commerce Committee, included the coal ash regulations among his list of what he called EPA's "regulatory train wreck" of "job-killing regulations" when he announced Republicans would be "Declaring War On The Regulatory State." [See WIMS 10/20/10]. Representative Upton said, "Under current regulations, coal byproducts are widely recycled, creating jobs and protecting the environment. New EPA regulations could cost more than $20 billion and tens of thousands of jobs."

     On May 4, U.S. EPA announced it was proposing the first-ever national rules to ensure the safe disposal and management of coal ash from coal-fired power plants [See WIMS 5/4/10]. Coal ash, are byproducts of the combustion of coal at power plants and are disposed of in liquid form at large surface impoundments and in solid form at landfills. In August 2010, the Agency announced it would be hosting seven public hearings through September on the controversial proposal [See WIMS 8/19/10] and extended the comment period until November 19. 

    EPA's proposal called for public comment on two approaches for addressing the risks of coal ash management under the nation's primary law for regulating solid waste, the Resource Conservation and Recovery Act (RCRA). One option is drawn from authorities available under Subtitle C, which creates a comprehensive program of Federally enforceable requirements for waste management and disposal. The other option includes remedies under Subtitle D, which gives EPA authority to set performance standards for waste management facilities and would be enforced primarily through citizen suits. A chart comparing and contrasting the two approaches is available on the EPA website.

    Under both approaches EPA has proposed to leave in place the "Bevill exemption" for beneficial uses of coal ash in which coal combustion residuals are recycled as components of products instead of placed in impoundments or landfills. Large quantities of coal ash are used in concrete, cement, wallboard and other contained applications that EPA said should not involve any exposure by the public to unsafe contaminants. These uses would not be impacted by the proposal. EPA solicited public comment on how to frame the continued exemption of beneficial uses from regulation and is focusing in particular on whether that exemption should exclude certain non-contained applications where contaminants in coal ash could pose risks to human health.

    Access a release from the groups and link to the re-evaluation analysis, testimony of Frank Ackerman, and streaming audio file of news event (click here). Access EPA's docket on the coal ash regulations (click here). Access more information about the proposed regulation (click here). Access EPA's chart comparing the two approaches described above (click here).