What Are the Net Benefits of Reducing the Ozone Standard to 65 ppb? An Alternative Analysis

Abstract

In October 2015, the United States Environmental Protection Agency (EPA) lowered the level of the ozone National Ambient Air Quality Standard (NAAQS) from 0.075 ppm to 0.070 ppm (annual 4th highest daily maximum 8-h concentration, averaged over three years). The EPA estimated a 2025 annual national non-California net benefit of $1.5 to $4.5 billion (2011$, 7% discount rate) for a 0.070 ppm standard, and a −$1.0 to $14 billion net benefit for an alternative 0.065 ppm standard. The purpose of this work is to present a combined toxicological and economic assessment of the EPA’s benefit-cost analysis of the 2015 ozone NAAQS. Assessing the quality of the epidemiology studies based on considerations of bias, confounding, chance, integration of evidence, and application of the studies for future population risk estimates, we derived several alternative benefits estimates. We also considered the strengths and weaknesses of the EPA’s cost estimates (e.g., marginal abatement costs), as well as estimates completed by other authors, and provided our own alternative cost estimate. Based on our alternative benefits and cost calculations, we estimated an alternative net benefit of between −$0.3 and $1.8 billion for a 0.070 ppm standard (2011 $, 7% discount rate) and between −$23 and −$17 billion for a 0.065 ppm standard. This work demonstrates that alternative reasonable assumptions can generate very difference cost and benefits estimates that may impact how policy makers view the outcomes of a major rule.