Analysis - The Institute for Southern Studies

6B. Factors Applied for Scaling Benefits and Costs to the Three 2010 Regulatory Options
The regulatory compliance cost estimation presented in Chapter 4 of this RIA was initially formulated with reference to the October 2009
draft RIA regulatory options. Furthermore, the regulatory benefits evaluation in Chapter 5 of this RIA was based only on the 2010 regulatory
options. To resolve this inconsistency in scope between the two different sets of regulatory options evaluated for costs and for benefits,
respectively, this RIA applies the scaling factors (i.e., percentage extrapolation multipliers) displayed below in Exhibit 6F.
The cost analysis presented in Chapter 4 of this RIA is built upon a detailed (i.e., plant-by-plant for all 495 coal-fired electric utility plants)
engineering cost model which estimated "engineering control" costs associated with the RCRA 3004(x) custom-tailored technical standards of
the 2009 regulatory options (i.e., Subtitle C "hazardous waste" option, Subtitle D non-hazardous waste option requiring composite liners for
new CCR disposal units, and a "hybrid" C/D option). Although the engineering control costs were the same for each of the three October 2009
options, "ancillary costs" differed according to whether an option was formulated in reference to Subtitle C or to Subtitle D authority. For
example, only the Subtitle C "hazardous waste" option and the Subtitle C component of the "Hybrid C/D" option required the cost associated
with manifesting offsite shipments of CCR between coal-fired electric utility plants and offsite CCR disposal locations. The October 2009
draft RIA presented the "dry conversion cost" element as a separable "sub-option" for both the Subtitle C and Subtitle D options.
However, in 2010 EPA identified a different set of three regulatory options to describe in the proposed rule and evaluate in RIA (i.e., Subtitle C
"special waste" option with wet disposal phase-out, Subtitle D option which in effect would phase-out wet CCR disposal by requiring
retrofitting existing impoundments with composite liners, and a Subtitle "D prime" option requiring liners only for new disposal units). In
order to meet EPA’s end-of-March 2010 internal deadline for completing the 2 nd draft of this RIA, EPA did not revised the Chapter 4 cost
analysis or the Chapter 7 supplemental analyses, but applied scaling factors for bridging the cost estimates to the 2010 options. Numerically,
the scaling factors represent alternative compliance rate assumptions in relation to the 2009 draft RIA’s Subtitle C "hazardous waste" option as
a reference case for both cost and benefit estimate scaling to the three 2010 regulatory options. The scaling factors assume less compliance
under the non-Federally enforceable Subtitle D based options compared to the Federally-enforceable Subtitle C option. Section 6B of this RIA
provides the numerical values assigned to the scaling factors on an itemized basis according to the separate cost element and benefit element
categories, for each of the three 2010 regulatory options.
Exhibit 6F
Scaling Factors (Extrapolation Multipliers) Applied in this RIA to Estimate the Costs & Benefits
of the 2010 Regulatory Options for CCR Disposal
Economic Impact Category
Subtitle C
Special Waste
Subtitle D
(version 2)
Subtitle
“D prime”
Regulatory Compliance Costs:
1. Engineering control costs 100% 48% 48%
2. Ancillary costs 100% 48% 48%
3. Dry conversion costs 100% 40% 0%
Regulatory Benefits:
198