NERA Study Predicts High Costs For Proposed Ozone Regulations

by | Aug 1, 2014

OzoneA study commissioned by the National Association of Manufacturers states that the more stringent ozone standards proposed by the Obama Administration could reduce GDP by $270 billion per year and carry a compliance price tag of $2.2 trillion from 2017 to 2040.

The NAM estimates the new standards would be the most expensive regulation the US government has ever issued.

The study, conducted by National Economic Research Associates Economic Consulting, states that revising the ozone standard from 75 parts per billion to 60 ppb could result in 2.9 million fewer job equivalents per year on average through 2040, cost the average US household $1,570 per year in the form of lost consumption, and increase natural gas and electricity costs for manufacturers and households across the US.

The study does not take into account any potential health benefits that would result from the new regulations.

Tightening the current ozone standard would do real harm to the manufacturing sector right as it is making a comeback, according to Jay Timmons, CEO and president of NAM, adding that the new regulations would make it nearly impossible for manufacturing to increase operations, create new jobs or keep pace internationally.

According to Ross Eisenberg, vice president of energy and resources policy for NAM, the new regulations would set ozone levels below those that exist at national parks such as Yellowstone and Denali. Eisenberg believes it is vital that the Obama Administration leave existing ozone standards in place.

The NAM is planning an education campaign in key states during the August congressional recess and throughout the fall to increase understanding of the issue and its potential impact on states and municipalities.

President Obama previously withdrew a proposed ozone level change in 2011, a change which had been heavily criticized by industry and the GOP at the time. Those standards would have limited ground-level ozone to between 60 and 70 ppb, down from the 75 ppb set by the Bush administration in March 2008.

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