Analysis - The Institute for Southern Studies

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Chapter 7 Supplemental Analyses Required by Congressional Statutes or White House Executive Orders Note: The computations presented in this Chapter are based on the cost estimates for the October 2009 draft RIA regulatory options using the larger dry conversion cost estimate prior to its update in Chapter 4. Because the high-end cost of the October 2009 draft RIA regulatory options (i.e., for the Subtitle C “hazardous waste” option) is larger than the high-end cost for the 2010 options (i.e., for the Subtitle C “special waste” option), the effects estimated in this Chapter are proportionately over-estimated. 7A. Electricity Price Impact (Executive Order 13211) The 2001 Executive Order 13211 168 “Actions Concerning Regulations that Significantly Affect Energy Supply, Distribution, or Use” requires Federal agencies to evaluate and prepare a statement on any potential adverse effects of economically-significant rulemakings on energy supply, distribution or use, including: Shortfall in energy supply Energy price increases Increased use of foreign energy supplies The OMB’s 13 July 2001 Memorandum M-01-27 169 guidance for implementing this Executive Order identifies nine numerical indicators (thresholds) of potential adverse energy effects, three of which are relevant for evaluation in this RIA: Increases in the cost of energy production in excess of 1% Increases in the cost of energy distribution in excess of 1% Other similarly adverse outcomes. Because this RIA did not collect and analyze data on energy production cost or energy distribution cost, this RIA evaluated the potential impact of the CCR regulatory options on electricity prices relative to the 1% threshold of both indicators as an indicator of “other similarly adverse outcome”. This RIA calculated the potential increase in statewide electricity prices that the industry compliance costs might induce under each CCR regulatory option. This calculation involved plant-by-plant annual revenue estimates and annualized compliance cost estimates, and respective statewide average electricity prices for the 495 electric utility plants, according to the following four steps. 168 The 18 May 2001 EO-13211 is available at: http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=2001_register&docid=fr22my01-133.pdf 169 OMB’s 13 July 2001 Memorandum M-01-27 is available at: http://www.whitehouse.gov/omb/memoranda_m01-27/ 204
Step 1: Downloaded the annual million megawatt capacity data for each of the 495 plants from the DOE-EIA website (2007), and estimated annual electricity output for each plant, by multiplying the capacity data by three factors: o 365 operating days per year o 24 operating hours per day o 86.8% capacity utilization per year 170 Step 2: Estimated the annual electricity sales revenue for each plant by multiplying the estimated annual electricity output sold by each plant (from Step 1), by the respective statewide average retail price (May 2009) of electricity for all sectors (i.e., residential, commercial, industrial, transportation) from DOE-EIA at http://www.eia.doe.gov/cneaf/electricity/epm/table5_6_a.html Step 3: Added the estimated incremental regulatory costs on a plant-by-plant basis, to the estimated annual electricity sales revenue for each plant, to obtain a hypothetical future annual revenue target, which represents a 100% cost pass-thru scenario. This simple scenario represents an upper-bound case of potential electricity price increase. Furthermore, if this 100% cost pass-thru is averaged over the entire electricity supply in each state, not just averaged over the 495 coal-fired electricity plants as done in this RIA, the potential percentage increase in electricity price would be less than this upper-bound case presented in this RIA. Step 4: Divided the hypothetical future annual revenue target by the estimated annual electricity output for each plant, to obtain a hypothetical future (higher) target price for each plant, which incorporates the added regulatory cost. Compared the higher target price to the current price to calculate the potential price increase on a percentage basis for each of the 495 plants. Exhibit 7A below presents the findings of this energy price evaluation on a state-by-state basis. As displayed in the bottom row of Exhibit 7A, none of the options have an expected nationwide average energy price increase >1%. Appendix L presents the plant-by-plant calculation spreadsheet used for this electricity price impact analysis. Item Exhibit 7A State by State Breakout of Average Electricity Price Increases Per Option May 2009 Subtitle C Subtitle D statewide average hazardous waste (version 1) electricity price ($ Average Price Average Price State per kilowatt hour) Increase Increase C - impoundments D - landfills Average Price Increase Number of Plants Average annualized cost (from Exhibit 4F) = $2,274 $492 $2,176 1 2 AK $0.1518 1.30% 1.23% 1.25% 2 10 AL $0.0856 1.43% 0.189% 1.419% 170 Source: 86.8% capacity utilization is the 1972-2008 annual average published in the 15 May 2009 Federal Reserve Statistical Release G.17 “Industrial Production & Capacity Utilization” data for Utilities at http://www.federalreserve.gov/releases/g17/Current/default.htm 205
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Regulatory Impact Analysis For EPA
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Table of Contents Executive Summary
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Executive Summary This RIA evaluate
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impoundments, the relative number t
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Summary Exhibit 3 Induced Effect of
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Summary Exhibit 6 Comparison of Reg
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Chapter 1 Problem Statement: The Ne
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Bevill Amendments 10 which exempted
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Just three weeks after the TVA’s
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2. Waste & Environmental Management
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This RIA did not discover similar d
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Exhibit 2A Identity of Other Indust
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Require review of surface impoundme
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Chapter 3 Baseline CCR Management i
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Exhibit 3C below, these 495 coal-fi
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Exhibit 3C State-by-State Electric
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3B. Types of CCR Disposal Units Es
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92 plants Offsite landfill fly ash
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electric utility plants in the data
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Exhibit 3E Annual CCR Disposition f
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3D. Size of CCR Disposal Units The
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costs for each type of disposal (no
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annual sampling for surface impound
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o Of the 25 state regulations revie
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Exhibit 3I Baseline Compliance with
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Baseline CCR Disposal Cost Estimati
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Before-tax costs: 50-year period:
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Baseline “Engineering Control”
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assume that the same water trucks w
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memorandum to George Garland, EPA,
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Exhibit 3K Summary of Industry & St
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($80,000 per year average Subtitle
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Validity Check of Baseline Cost Est
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Chapter 4 Estimated Cost for RCRA R
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B. Ancillary costs for CCR disposal
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location restriction mitigation inv
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o Impoundment berms: The average su
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State government average cost per w
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corrective action remedies usually
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Exhibit 4A Two Case Studies: Possib
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Biennial Report”). According to E
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4B.3 Land Disposal Restriction Cost
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The TVA cost study did not estimate
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Using the EPA ORCR 2009$ updated un
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Exhibit 4D Comparison of Annual O&M
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Exhibit 4E Summary of Wet Conversio
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o Recent Trend in CCR Impoundment P
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from coal to other fuels such as na
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o Result of Dry Conversion Cost Upd
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As summarized below in comparison t
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17% phase-out trend suggest the fut
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RIA 50- ye ar period Actual company
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4C. State-by-State Distribution of
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4D. Cost Estimation Uncertainty Thi
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Exhibit 4N Cost Estimation Uncertai
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In contrast to the Exhibit 5A list
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Step 2. Determine Potentially Affec
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Step 3. Apply EPA-ORCR 2009 Arsenic
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RISKn WELLREACH iRISK EDn N Where
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The constant slope allowed estimati
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Step 6. Monetize Future Avoided Can
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controls like surface-impoundment p
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Finally, for Subtitle C, there woul
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Exhibit 5A-12 Percentile of Cleanup
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Exhibit 5A-16 Per-Site Groundwater
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Multiple CCR disposal units at a si
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5B. Benefit of Preventing Future CC
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As displayed below in Exhibit 5B-2,
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Where: = Observed arrival rate (0.
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Step 3. Calculate Future Impoundmen
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some surface impoundment regulation
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Exhibit 5B-8 Poisson Distribution (
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With these new distributions, EPA p
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Exhibit 5B-12 Scenario #2: Cleanup
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5C. Induced Effect of RCRA Regulati
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Exhibit 5C-1 Estimate of Annual Mat
Page 153 and 154: Exhibit 5C-3 below presents a 2004
Page 155 and 156: To avoid double-counting of economi
Page 157 and 158: 5C2. Potential Effect of RCRA Regul
Page 159 and 160: Others take a different view on how
Page 161 and 162: Exhibit 5C-7 EPA Extrapolation of E
Page 163 and 164: Based on the most recent CCR benefi
Page 165 and 166: Beneficial uses of CCR have been co
Page 167 and 168: Exhibit 5C-12 Beneficial Use Trend
Page 169 and 170: Increases due to increased disposal
Page 171 and 172: “Using [coal] fly ash in building
Page 173 and 174: Exhibit 5C-14 Historical Annual Per
Page 175 and 176: Hypothetical expansion of CCR custo
Page 177 and 178: Step 6: Apply Estimated Induced Eff
Page 179 and 180: Exhibit 5C-16 Scenario #1: Increase
Page 181 and 182: Exhibit 5C-17 Scenario #2: Decrease
Page 183 and 184: Exhibit 5C-18 Beneficial Use Trends
Page 185 and 186: Exhibit 5C-19 Scenario #1: Benefit
Page 187 and 188: Exhibit 5C-21 Scenario #2: Cost of
Page 189 and 190: Step 10: Quantify Potential Capacit
Page 191 and 192: Chapter 6 Comparison of Regulatory
Page 193 and 194: Exhibit 6B Comparison of Regulatory
Page 195 and 196: Exhibit 6D Comparison of Regulatory
Page 197 and 198: Exhibit 6F Comparison of Regulatory
Page 199 and 200: Exhibit 6F Scaling Factors (Extrapo
Page 201 and 202: Exhibit 6G Estimate of Subtitle D (
Page 203: detect contamination early and thus
Page 207 and 208: Exhibit 7A State by State Breakout
Page 209 and 210: Small government: Based on the RFA/
Page 211 and 212: Step 3 & Step 4: Determine and docu
Page 213 and 214: Factor #2 of 2: The small business
Page 215 and 216: how much they use or indeed how muc
Page 217 and 218: Collection of Minority & Low-Income
Page 219 and 220: Comparison of Minority & Low-Income
Page 221 and 222: Exhibit 7G Minority and Low-Income
Page 223 and 224: Exhibit 7H Comparison of Minority a
Page 225 and 226: o The state-by-state range of minor
Page 227 and 228: CCR fraction #3: CCR fraction #4:
Page 229 and 230: 7D. Child Population Statistics (Ex
Page 231 and 232: Comparison of Child Populations Liv
Page 233 and 234: Count of plant unique ZCTAds Exhibi
Page 235 and 236: Exhibit 7K Comparison of Child Popu
Page 237 and 238: 7E. Unfunded Mandates (UMRA) & Fede
Page 239 and 240: Findings for UMRA Impact and Federa
Page 241 and 242: Exhibit 7M List of 74 Coal-Fired El
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Analysis - The Institute for Southern Studies

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