Analysis - The Institute for Southern Studies

In comparison to these baseline “raw materials acquisition cost” elements, CCR disposal costs are estimated to be $83/ton for the Subtitle C
option (source: Exhibit 4K). While this represents a 44% increase ($26/ton) over the baseline disposal cost of $59/ton, this ignores the CCR
price and the transportation cost elements. Factoring these components in, the $26/ton increase represents a 28% increase above the total
baseline raw material cost of $94.50/ton. This RIA applies this 28% growth factor to represent demand elasticity 153 assumptions of:
+0.64 with respect to the CCR “avoided disposal cost incentive” factor (i.e., +28%/+44%).
+1.00 with respect to total “raw material acquisition cost” consisting of all three cost factors included (i.e., +28%/+28%).
This RIA applies the elasticity estimate of 1.0 in reference to the “raw material acquisition cost” to represent the potential increase in CCR
beneficial use by 28% over the baseline under the Subtitle C option. The other regulatory options are proportionately adjusted below. In
comparison to historical annual percentage changes in CCR beneficial use tonnages, this 28% increase is a reasonable assumption as it falls
between the -22.6% decrease and +55.2% increase min-max range (annual mean = +8.2% increase) over the 43 year period 1966 to 2008, 154 as
displayed in Exhibit 5C-14 below.
Exhibit 5C-14
Historical Annual Percentage Change in CCR Beneficial Use (1966-2008)
A B C D E F (E/C) G
Item Year
CCR generation
(tons)
CCR disposal
(tons)
CCR beneficial
use (tons)
Percent CCR
beneficial use
1 1966 26,000,000 22,000,000 4,000,000 15%
2 1967 28,000,000 23,000,000 5,000,000 18% 25.0%
3 1968 30,000,000 24,000,000 6,000,000 20% 20.0%
4 1969 31,500,000 26,000,000 5,500,000 17% -8.3%
5 1970 39,000,000 33,200,000 5,800,000 15% 5.5%
6 1971 41,500,000 32,500,000 9,000,000 22% 55.2%
7 1972 46,000,000 38,000,000 8,000,000 17% -11.1%
8 1973 50,000,000 41,500,000 8,500,000 17% 6.3%
9 1974 59,000,000 50,000,000 9,000,000 15% 5.9%
10 1975 60,000,000 50,000,000 10,000,000 17% 11.1%
11 1976 62,000,000 50,000,000 12,000,000 19% 20.0%
12 1977 67,000,000 53,000,000 14,000,000 21% 16.7%
13 1978 68,000,000 52,000,000 16,000,000 24% 14.3%
14 1979 75,500,000 60,000,000 15,500,000 21% -3.1%
15 1980 66,000,000 54,000,000 12,000,000 18% -22.6%
16 1981 68,000,000 51,500,000 16,500,000 24% 37.5%
Annual % change in
CCR beneficial use tons
153 In economics, the elasticity of supply indicates the responsiveness of the quantity of a product or service supplied to the market relative to a change in its price (i.e., (%
change in quantity supplied) / (% change in its price)). Similarly, the elasticity of demand indicates the responsiveness of the quantity of market demand for a product or
service relative to a change in its price (i.e., (% change in quantity demanded) / (% change in its price)).
154 Historical CCR beneficial use data for 1966-2008 from ACAA at http://www.acaa-usa.org/associations/8003/files/Revised_1966_2007_CCP_Prod_v_Use_Chart.pdf
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