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disposal units, can exceed the human health hazard quotient (HQ) or Maximum Contaminant Limit (MCL). Chapter 5 of this RIA provides a list of contaminants of concern in CCR surface impoundment effluent and potential human health and environmental effects. 4. Dry CCR disposal risks: Human health effects from improperly managed dry disposal, which are based on ongoing research by EPA’s Office of Research & Development (ORD), may pose greater risks than previously estimated by EPA in 2000 and 2007. ES-4: Economic & Environmental Benefits from Future Increase in CCR Beneficial Uses by Other Industries This RIA evaluated the potential impact that the CCR proposed rule may have on beneficial uses of CCR by other industries. Baseline CCR beneficial use at the current 62 million tons per year rate (2009) is estimated in this RIA to provide $26 billion per year in nationwide social benefits consisting of: (a) materials cost savings, plus (b) lifecycle avoided pollution benefits, plus (c) avoided CCR disposal costs to the electric utility industry. On a present value basis over the 50-year future period-of-analysis (2012-2061) applied in this RIA, the present value of CCR beneficial use amounts to $778 billion (@7% discount). Although the industries which use CCR for beneficial uses are not subject to the requirements of the CCR proposed rule, this RIA presents three alternative scenarios of potential induced effect of the CCR rule on future CCR beneficial use, consisting of increased use (scenario #1), decreased use (scenario #2), and no change (scenario #3). This RIA quanfities both scenario #1 and scenario #2 incrementally in relation to the “no change” scenario #3. EPA believes the increasing beneficial use scenario #1 is most likely because (a) the proposed CCR regulation is targeted at CCR disposal not at CCR beneficial uses, (b) all CCR regulatory options retain the existing RCRA Bevill exemption for CCR beneficial uses, and (c) the added cost of regulatory compliance will make beneficial use relatively more cost-effective and represent an “avoided disposal cost incentive” 4 to electric utility plants to increase their supply of CCR to industrial markets for CCR as a raw or intermediate input into industrial manufacturing and construction activities. Furthermore, EPA does not believe that market “stigma” of CCR regulation under RCRA Subtitle C --- as alleged in numerous stakeholder letters to the EPA in 2009 --- will result in a reduction in future annual CCR beneficial use, because the proposed rule designates the Subtitle C option as a “special waste” rather than as a “hazardous waste.” Summary Exhibit 3 below presents the results for both the increase scenario #1 and the decrease scenario #2. 4 The concept of “avoided disposal cost incentive” is recognized and defined by the American Coal Ash Association (ACAA) on its website as follows: “If a [coal-fired electric utility] plant markets its [CCR] into commercial applications, then disposal of this [CCR] is not required. Not only is a revenue stream created for the [coal-fired electricity plant] but also the need to dispose of the [CCR] is avoided. As discussed above, disposal is not just the transportation and placement of [CCR] in a disposal site. The need for future space is a concern. If [CCR is] marketed, then the need to develop future [CCR disposal] sites (including land acquisition, permitting, design and construction costs) is avoided …. It is not uncommon for a company to help offset the costs of transportation or placement at construction sites by providing the contractor or trucking firm a payment of some sort. For example, if the cost of disposal at a plant is normally four dollars a ton, then the company may arrange a payment of four dollars or less to the contractors to cover transportation and placement costs. The difference between the amount of this payment and the cost of disposal is also referred to as “avoided disposal costs.” Source: ACAA Frequently Asked Question nr. 14 webpage at: http://acaa.affiniscape.com/displaycommon.cfm?an=1&subarticlenbr=5#Q14 8
Summary Exhibit 3 Induced Effect of RCRA Regulation of CCR Disposal on Future Annual CCR Beneficial Use ($millions present value @7%) Scenarios Subtitle C special waste Subtitle D (version 2) Subtitle “D prime” Scenario #1: Induced Increase in CCR Beneficial Use Percentage increase relative to baseline CCR beneficial use +11% +4% +2% Economic market value +$5,560 +$2,224 +$890 Lifecycle social value +$84,489 +$33,796 +$13,518 Scenario #2: Induced Decrease in CCR Beneficial Use Percentage decrease relative to baseline CCR beneficial use -18% No impact No impact Economic market value -$18,744 No impact No impact Lifecycle social value -$233,549 No impact No impact ES-5: Regulatory Compliance Costs Chapter 4 of the RIA presents the estimated costs for industry compliance (and for government implementation) of each regulatory option. Summary Exhibit 4 below presents the estimated costs on a present value basis. The RIA presents three categories of regulatory compliance cost. These regulatory costs are incremental to an estimated $5,556 million per year average annual baseline (i.e., current) cost to the electric utility industry for CCR disposal, which represents a baseline cost of $76,678 million in present value on a 7% and 50-year discounting basis. Summary Exhibit 4 Estimate of Regulatory Implementation & Compliance Cost ($millions present value @7% over 50-years) Cost Category Subtitle C special waste Subtitle D (version 2) Subtitle “D prime” 1. Engineering controls $6,780 $3,254 $3,254 2. Ancillary costs $1,480 $5 $5 3. Dry conversion cost $12,089 4,836 $0 Total Cost (1+2+3) = $20,349 $8,095 $3,259 Increase over baseline CCR disposal cost = +27% +11% +4% The dry conversion cost estimate incorporates projection of the recent (1995-2009) electric utility industry trend converting away from wet CCR disposal to dry CCR disposal. In fact, there are several upcoming EPA regulations which could accelerate this trend but are not reflected in the cost estimate of this RIA. These are anticipated rules under the Clean Air Act which will increase the installation of air pollution scrubbers and other air emission control technology at coal-fired power plants, as well as new wastewater effluent guidelines under the Clean Water Act which will require installation of treatment technology for wastewater discharges from CCR impoundments to surface waters. 9
Page 1 and 2: Regulatory Impact Analysis For EPA
Page 3 and 4: Table of Contents Executive Summary
Page 5 and 6: Executive Summary This RIA evaluate
Page 7: impoundments, the relative number t
Page 11 and 12: Summary Exhibit 6 Comparison of Reg
Page 13 and 14: Chapter 1 Problem Statement: The Ne
Page 15 and 16: Bevill Amendments 10 which exempted
Page 17 and 18: Just three weeks after the TVA’s
Page 19 and 20: 2. Waste & Environmental Management
Page 21 and 22: This RIA did not discover similar d
Page 23 and 24: Exhibit 2A Identity of Other Indust
Page 25 and 26: Require review of surface impoundme
Page 27 and 28: Chapter 3 Baseline CCR Management i
Page 29 and 30: Exhibit 3C below, these 495 coal-fi
Page 31 and 32: Exhibit 3C State-by-State Electric
Page 33 and 34: 3B. Types of CCR Disposal Units Es
Page 35 and 36: 92 plants Offsite landfill fly ash
Page 37 and 38: electric utility plants in the data
Page 39 and 40: Exhibit 3E Annual CCR Disposition f
Page 41 and 42: 3D. Size of CCR Disposal Units The
Page 43 and 44: costs for each type of disposal (no
Page 45 and 46: annual sampling for surface impound
Page 47 and 48: o Of the 25 state regulations revie
Page 49 and 50: Exhibit 3I Baseline Compliance with
Page 51 and 52: Baseline CCR Disposal Cost Estimati
Page 53 and 54: Before-tax costs: 50-year period:
Page 55 and 56: Baseline “Engineering Control”
Page 57 and 58: 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
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Exhibit 5C-3 below presents a 2004
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To avoid double-counting of economi
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5C2. Potential Effect of RCRA Regul
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Others take a different view on how
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Exhibit 5C-7 EPA Extrapolation of E
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Based on the most recent CCR benefi
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Beneficial uses of CCR have been co
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Exhibit 5C-12 Beneficial Use Trend
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Increases due to increased disposal
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“Using [coal] fly ash in building
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Exhibit 5C-14 Historical Annual Per
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Hypothetical expansion of CCR custo
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Step 6: Apply Estimated Induced Eff
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Exhibit 5C-16 Scenario #1: Increase
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Exhibit 5C-17 Scenario #2: Decrease
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Exhibit 5C-18 Beneficial Use Trends
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Exhibit 5C-19 Scenario #1: Benefit
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Exhibit 5C-21 Scenario #2: Cost of
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Step 10: Quantify Potential Capacit
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Chapter 6 Comparison of Regulatory
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Exhibit 6B Comparison of Regulatory
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Exhibit 6D Comparison of Regulatory
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Exhibit 6F Comparison of Regulatory
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Exhibit 6F Scaling Factors (Extrapo
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Exhibit 6G Estimate of Subtitle D (
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detect contamination early and thus
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Step 1: Downloaded the annual milli
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Exhibit 7A State by State Breakout
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Small government: Based on the RFA/
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Step 3 & Step 4: Determine and docu
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Factor #2 of 2: The small business
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how much they use or indeed how muc
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Collection of Minority & Low-Income
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Comparison of Minority & Low-Income
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Exhibit 7G Minority and Low-Income
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Exhibit 7H Comparison of Minority a
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o The state-by-state range of minor
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CCR fraction #3: CCR fraction #4:
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7D. Child Population Statistics (Ex
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Comparison of Child Populations Liv
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Count of plant unique ZCTAds Exhibi
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Exhibit 7K Comparison of Child Popu
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7E. Unfunded Mandates (UMRA) & Fede
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Findings for UMRA Impact and Federa
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Exhibit 7M List of 74 Coal-Fired El
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Analysis - The Institute for Southern Studies

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