§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses for Existing and New Facilities Appendix to Chapter D2

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Appendix to Chapter D2

This appendix presents the results of the UMRA analysis for the other five options considered for Phase III

existing facilities, combined with the proposed option for new offshore oil and gas extraction facilities. For all

options, results only include those Phase III existing facilities that are (1) non-baseline closures and (2) subject to

national categorical requirements under the option. See the main body of this chapter for a description of data

sources and methodologies used in these analyses.

In Table D2A-1 below, the other evaluated options for Phase III existing facilities, combined with the proposed

option for new offshore oil and gas extraction facilities, are presented in order of increasing stringency and/or

applicability (e.g., the largest number of facilities would be subject to the national requirements under Option 6,

compared to any of the other evaluated options).

Table D2A-1: Summary of UMRA Costs for Other Evaluated Options (in millions, 2003$)

Sector

Total Annualized Cost Maximum One-Year Cost

Facility

Compliance

Costs

Government

Implementation

Costs

Total

Facility

Compliance

Costs

Government

Implementation

Costs

Total

Option 3 for Existing Facilities / Proposed Option for New OOGE Facilities

Government Sector 

(excl. Federal) $1.0 $0.9 $1.9 $1.8 $4.5 $6.3

Private Sector $61.9 n/a $61.9 $712.2 n/a $712.2

Option 4 for Existing Facilities / Proposed Option for New OOGE Facilities

Government Sector 

(excl. Federal) $0.8 $0.8 $1.6 $1.7 $4.6 $6.4

Private Sector $66.0 n/a $66.0 $722.9 n/a $722.9

Option 2 for Existing Facilities / Proposed Option for New OOGE Facilities

Government Sector 

(excl. Federal) $1.4 $1.0 $2.4 $2.4 $5.6 $7.9

Private Sector $70.5 n/a $70.5 $730.7 n/a $730.7

Option 1 for Existing Facilities / Proposed Option for New OOGE Facilities

Government Sector 

(excl. Federal) $1.5 $1.1 $2.6 $2.4 $5.6 $8.1

Private Sector $72.3 n/a $72.3 $737.2 n/a $737.2

Option 6 for Existing Facilities / Proposed Option for New OOGE Facilities

Government Sector 

(excl. Federal) $1.8 $1.7 $3.5 $2.8 $7.6 $10.5

Private Sector $91.7 n/a $91.7 $922.3 n/a $922.3

Source: U.S. EPA Analysis, 2004.
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§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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CHAPTER CONTENTS

D3-1 E.O. 12866: Regulatory Planning and Review . . . . D3-1

D3-2 Paperwork Reduction Act of 1995 . . . . . . . . . . . . . . D3-1

D3-3 E.O. 13132: Federalism . . . . . . . . . . . . . . . . . . . . . . D3-2

D3-4 E.O. 13175: Consultation and Coordination with

Indian Tribal Governments . . . . . . . . . . . . . . . . . . . D3-4

D3-5 E.O. 13045: Protection of Children from Environmental

Health Risks and Safety Risks . . . . . . . . . . . . . . . . . D3-4

D3-6 E.O. 13211: Actions Concerning Regulations That

Significantly Affect Energy Supply, Distribution,

or Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D3-5

D3-6.1 Existing Electric Generators . . . . . . . . . . . D3-6

D3-6.2 New Offshore Oil and Gas Extraction

Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . D3-7

D3-7 National Technology Transfer and Advancement

Act of 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D3-7

D3-8 E.O. 12898: Federal Actions to Address Environmental

Justice in Minority Populations and Low-Income

Populations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D3-7

D3-9 E.O. 13158: Marine Protected Areas . . . . . . . . . . . . D3-8

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D3-9

Chapter D3: Other Administrative

Requirements

INTRODUCTION

This chapter presents several other analyses

conducted in developing this proposed rule. 

These analyses address the requirements of

Executive Orders and Acts applicable to Phase

III regulation.

D3-1 EXECUTIVE ORDER 12866:

REGULATORY PLANNING AND

REVIEW

Under Executive Order 12866 (58 FR 51735,

October 4, 1993), the Agency must determine

whether the regulatory action is “significant” and

therefore subject to OMB review and the

requirements of the Executive Order. The order

defines a “significant regulatory action” as one

that is likely to result in a rule that may:

< have an annual effect on the economy of $100 million or more or adversely affect in a material way the

economy, a sector of the economy, productivity, competition, jobs, the environment, public health or

safety, or State, local, or Tribal governments or communities; or

< create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; or

< materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and

obligations of recipients thereof; or

< raise novel legal or policy issues arising out of legal mandates, the President’s priorities, or the principles

set forth in the Executive Order.

Pursuant to the terms of Executive Order 12866, EPA determined that this proposed rule is a “significant

regulatory action.” As such, this action was submitted to OMB for review. Changes made in response to OMB

suggestions or recommendations are documented in the public record.

D3-2 PAPERWORK REDUCTION ACT OF 1995

The Paperwork Reduction Act of 1995 (PRA) (superseding the PRA of 1980) is implemented by the Office of

Management and Budget (OMB) and requires that agencies submit a supporting statement to OMB for any

information collection that solicits the same data from more than nine parties. The PRA seeks to ensure that

Federal agencies balance their need to collect information with the paperwork burden imposed on the public by

the collection.
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The definition of “information collection” includes activities required by regulations, such as permit development,

monitoring, record keeping, and reporting. The term “burden” refers to the “time, effort, or financial resources”

the public expends to provide information to or for a Federal agency, or to otherwise fulfill statutory or regulatory

requirements. PRA paperwork burden is measured in terms of annual time and financial resources the public

devotes to meet one-time and recurring information requests (44 U.S.C. 3502(2); 5 C.F.R. 1320.3(b)).

Information collection activities may include:

< reviewing instructions;

< using technology to collect, process, and disclose information;

< adjusting existing practices to comply with requirements;

< searching data sources;

< completing and reviewing the response; and

< transmitting or disclosing information.

Agencies must provide information to OMB on the parties affected, the annual reporting burden, the annualized

cost of responding to the information collection, and whether the request significantly impacts a substantial

number of small entities. An agency may not conduct or sponsor, and a person is not required to respond to, an

information collection unless it displays a currently valid OMB control number.

EPA’s estimate of the information collection requirements imposed by the proposed Phase III regulation are

documented in the Information Collection Request (ICR) which accompanies this regulation (U.S. EPA, 2004).

D3-3 EXECUTIVE ORDER 13132: FEDERALISM

Executive Order 13132 (64 FR 43255, August 10, 1999) requires EPA to develop an accountable process to

ensure “meaningful and timely input by State and local officials in the development of regulatory policies that

have federalism implications.” Policies that have federalism implications are defined in the Executive Order to

include regulations that have “substantial direct effects on the States, on the relationship between the national

government and the States, or on the distribution of power and responsibilities among the various levels of

government.”

Under section 6 of Executive Order 13132, EPA may not issue a regulation that has federalism implications, that

imposes substantial direct compliance costs, and that is not required by statute unless the Federal government

provides the funds necessary to pay the direct compliance costs incurred by State and local governments or unless

EPA consults with State and local officials early in the process of developing the regulation. EPA also may not

issue a regulation that has federalism implications and that preempts State law, unless the Agency consults with

State and local officials early in the process of developing the regulation.

This proposed rule does not have federalism implications. It would not have substantial direct effects on the

States, on the relationship between the national government and the States, or on the distribution of power and

responsibilities among the various levels of government, as specified in Executive Order 13132. Rather, this

proposed rule would result in minimal administrative costs on States that have an authorized NPDES program. 

EPA expects the following annual burden for States to collectively administer one of the three proposed options:

< 50 MGD for All Waterbodies option: 16,972 hours with a cost of $754,804 ($747,981 in labor costs and

$6,823 in non-labor costs);

< 200 MGD for All Waterbodies option: 4,677 hours with a cost of $201,092 ($198,932 in labor costs and

$2,160 in non-labor costs);

< 100 MGD for Certain Waterbodies option: 6,528 hours with a cost of $286,597 ($284,624 in labor costs

and $1,973 in non-labor costs).

It is noted that States do not incur any burden hours and costs to administer the proposed rule for the new offshore

oil and gas extraction facilities because the EPA Regions administer their permits; these facilities are therefore
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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outside the jurisdiction of the States. In addition, EPA has identified zero Phase III existing facilities that are

owned by Federal, State or local government entities therefore the annual impacts on these facilities is zero.

The proposed national cooling water intake structure requirements would be implemented through permits issued

under the NPDES program. Forty-five States and one territory are currently authorized pursuant to section 402(b)

of the CWA to implement the NPDES program. In States not authorized to implement the NPDES program, EPA

issues NPDES permits. Under the CWA, States are not required to become authorized to administer the NPDES

program. Rather, such authorization is available to States if they operate their programs in a manner consistent

with section 402(b) and applicable regulations. Generally, these provisions require that State NPDES programs

include requirements that are as stringent as Federal program requirements. States retain the ability to implement

requirements that are broader in scope or more stringent than Federal requirements. (See section 510 of the

CWA.)

EPA does not expect this proposed rule to have substantial direct effects on either authorized or nonauthorized

States or on local governments because it would not change how EPA and the States and local governments

interact or their respective authority or responsibilities for implementing the NPDES program. This rule

establishes national requirements for Phase III facilities with cooling water intake structures. NPDES-authorized

States that currently do not comply with the proposed regulations based on this rule might need to amend their

regulations or statutes to ensure that their NPDES programs are consistent with Federal section 316(b)

requirements. (See 40 CFR 123.62(e).) For purposes of this rule, the relationship and distribution of power and

responsibilities between the Federal government and the State and local governments are established under the

CWA (e.g., sections 402(b) and 510); nothing in this rule alters that. Thus, the requirements of section 6 of the

Executive Order do not apply to this rule.

Although section 6 of Executive Order 13132 does not apply to this rule, EPA did consult with State governments

and representatives of local governments in developing definitions and concepts relevant to the section 316(b)

rulemaking and this proposed rule:

< During the development of the proposed section 316(b) rule for new facilities (Phase I), EPA conducted

several outreach activities through which State and local officials were informed about the section 316(b)

rulemaking effort. These officials then provided information and comments to the Agency. The outreach

activities were intended to provide EPA with feedback on issues such as adverse environmental impact,

BTA, and the potential cost associated with various regulatory alternatives.

< EPA has made presentations on the section 316(b) rulemaking effort in general at eleven professional and

industry association meetings. EPA also conducted two public meetings in June and September of 1998

to discuss issues related to the section 316(b) rulemaking effort. In September 1998 and April 1999, EPA

staff participated in technical workshops sponsored by the Electric Power Research Institute on issues

relating to the definition and assessment of adverse environmental impact. EPA staff have worked with

numerous States such as New York, New Jersey, California, Rhode Island, and Massachusetts and regions

such as Region 1 and Region 9. EPA further organized a meeting of technical experts (May 23, 2001)

and a Symposium on Technologies for Protecting Aquatic Organisms from Cooling Water Intake

Structures (BTA symposium, May 6-7, 2003).

< EPA met with the Association of State and Interstate Water Pollution Control Administrators

(ASIWPCA) and, with the assistance of ASIWPCA, conducted a conference call in which representatives

from 17 States or interstate organizations participated.

< EPA met with OMB and utility representatives and other Federal agencies (the Department of Energy, the

Small Business Administration, the Tennessee Valley Authority, the National Oceanic and Atmospheric

Administration’s National Marine Fisheries Service and the Department of Interior’s U.S. Fish and

Wildlife Service).
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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< EPA received more than 130 comments on the Phase I proposed rule and Notice of Data Availability

(NODA). State and local government representatives from the following States submitted comments:

Alaska, California, Florida, Louisiana, Maryland, Michigan, Nebraska, New Hampshire, New Jersey,

New York, North Carolina, North Dakota, Ohio, Pennsylvania, and Texas. In addition, EPA received

more than 170 comments on the Phase II proposed rule and NODA, including comments from State and

local government representatives from Arkansas, Alabama, Indiana, Tennessee, and Rhode Island. In

some cases these comments have informed the development of the Phase III rulemaking effort.

< On May 23, 2001, EPA held a day-long forum to discuss specific issues associated with the development

of regulations under section 316(b). At the meeting, 17 experts from industry, public interest groups,

States, and academia reviewed and discussed the Agency’s preliminary data on cooling water intake

structure technologies that are in place at existing facilities and the costs associated with the use of

available technologies for reducing impingement and entrainment. Over 120 people attended the

meeting.

In the spirit of this Executive Order and consistent with EPA policy to promote communications between EPA

and State and local governments, the preamble to this proposed rule specifically solicits comment from State and

local officials.

D3-4 EXECUTIVE ORDER 13175: CONSULTATION AND COORDINATION WITH INDIAN TRIBAL

GOVERNMENTS

Executive Order 13175 (65 FR 67249, November 6, 2000) requires EPA to develop an accountable process to

ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal

implications.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that

have “substantial direct effects on one or more Indian Tribes, on the relationship between the Federal government

and the Indian Tribes, or on the distribution of power and responsibilities between the Federal government and

Indian Tribes.” This proposed rule does not have tribal implications. It would not have substantial direct effects

on tribal governments, on the relationship between the Federal government and Indian Tribes, or on the

distribution of power and responsibilities between the Federal government and Indian Tribes, as specified in

Executive Order 13175. EPA’s analyses show that no facility subject to Phase III regulation is owned by tribal

governments. This proposed rule does not affect Tribes in any way in the foreseeable future. Accordingly, the

requirements of Executive Order 13175 do not apply to this rule.

D3-5 EXECUTIVE ORDER 13045: PROTECTION OF CHILDREN FROM ENVIRONMENTAL

HEALTH RISKS AND SAFETY RISKS

Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any rule that (1) is determined to be

“economically significant” as defined under Executive Order 12866 and (2) concerns an environmental health or

safety risk that EPA has reason to believe might have a disproportionate effect on children. If the regulatory

action meets both criteria, the Agency must evaluate the environmental health and safety effects of the planned

rule on children and explain why the planned regulation is preferable to other potentially effective and reasonably

feasible alternatives considered by the Agency. This proposed rule is a significant rule as defined under

Executive Order 12866. However, it does not concern an environmental health or safety risk that would have a

disproportionate effect on children. Therefore, it is not subject to Executive Order 13045.

D3-6 EXECUTIVE ORDER 13211: ACTIONS CONCERNING REGULATIONS THAT

SIGNIFICANTLY AFFECT ENERGY SUPPLY, DISTRIBUTION, OR USE
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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Executive Order 13211, (“Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution,

or Use” (66 FR 28355, May 22, 2001)) requires EPA to prepare a Statement of Energy Effects when undertaking

regulatory actions identified as “significant energy actions.” For the purposes of Executive Order 13211,

“significant energy action” means:

“any action by an agency (normally published in the Federal Register) that promulgates or

is expected to lead to the promulgation of a proposed rule or regulation, including notices of

inquiry, advance notices of proposed rulemaking, and notices of proposed rulemaking: 

(1) (i) that is a significant regulatory action under Executive Order 12866 or any

successor order, and 

(ii) is likely to have a significant adverse effect on the supply, distribution, or use of

energy; or 

(2) that is designated by the Administrator of the Office of Information and Regulatory

Affairs (OIRA) as a significant energy action.”

For those regulatory actions identified as “significant energy actions,” a Statement of Energy Effects must include

a detailed statement relating to (1) any adverse effects on energy supply, distribution, or use (including a shortfall

in supply, price increases, and increased use of foreign supplies) and (2) reasonable alternatives to the action with

adverse energy effects and the expected effects of such alternatives on energy supply, distribution, and use.

This rule is not a “significant energy action” as defined in Executive Order 13211 because it is not likely to have a

significant adverse effect on the supply, distribution, or use of energy. The proposed rule does not contain any

compliance requirements that would:

< reduce crude oil supply in excess of 10,000 barrels per day;

< reduce fuel production in excess of 4,000 barrels per day;

< reduce coal production in excess of 5 million tons per day;

< reduce electricity production in excess of 1 billion kilowatt hours per day or in excess of 500 megawatts

of installed capacity;

< increase energy prices in excess of 10 percent;

< increase the cost of energy distribution in excess of 10 percent;

< significantly increase dependence on foreign supplies of energy; or 

< have other similar adverse outcomes, particularly unintended ones.

Of the potential significant adverse effects on the supply, distribution, or use of energy (listed above) only a few

apply to this proposed rule. Regulation of Electric Generators, through increases in the cost of generating

electricity and shifts in the types of generators employed, might affect (1) the production of coal, (2) the

production of electricity, (3) the amount of installed capacity, (4) energy prices, and (5) the dependence on

foreign supplies of energy. Regulation of new offshore oil and gas facilities might affect (1) the production of oil

and gas, (2) energy prices, and (3) the dependence on foreign supplies of energy. While facilities in the

Manufacturing industry segments generate electricity, their contribution to the overall supply of electricity is

insignificant (less than 0.02%); therefore, compliance with the 316(b) Phase III regulation by this industry

segment would not perceptibly affect the supply, distribution, or use of energy.

Potential energy effects associated with the regulation of existing Electric Generators and new offshore oil and

gas extraction facilities are described in the following two subsections.

D3-6.1 Existing Electric Generators

The three proposed options for Electric Generators have design intake flow (DIF) applicability thresholds for

national categorical requirements of 50 MGD or greater, 100 MGD or greater, and 200 MGD or greater. Since

Electric Generators with a DIF of 50 MGD or greater were covered by the final Phase II rule, no Phase III
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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 This conversion assumes an average energy content of 10,115 Btu per pound of coal (U.S. DOE, 2000).

D3-6

Generator would be subject to the national requirements under the three proposed options; therefore there would

be no impacts on any measures of energy supply, distribution, or use under the proposed rule.

To assess potential energy effect of alternative evaluated options for Electric Generators, EPA used the results

from its electricity market model analysis (see the Appendix to Chapter B5: Economic Impact Analysis for

Electric Generators). EPA compared the post-compliance scenario (after the implementation of Phase III

compliance requirements) with Base Case 2 (including Phase II compliance costs but excluding Phase III

compliance costs). This comparison allows EPA to identify the incremental market-level effects of Phase III

regulation, beyond the effects of Phase II regulation. It should be noted that this analysis was only conducted for

Option 6, the most inclusive option with the highest regulatory costs and potential for energy effects. Therefore,

the potential energy effects of all other options evaluated by EPA would be lower.

 ̃ Production of coal

EPA estimates that Option 6 would decrease the annual use of coal for electricity generation by 53.8 trillion Btu

(TBtu), or 0.25%. This reduction converts to 2.66 million tons of coal per year or 7,286 tons of coal per day.1

Assuming that a reduction in the use of coal for electricity generation results in a similar reduction in coal

production, EPA concludes that Option 6 would not have a significant impact on the national production of coal

as defined by the thresholds listed above.

 ̃ Production of electricity

EPA’s electricity market analysis did not allow for an explicit consideration of the changes in the production of

electricity. However, based on the small effects on installed capacity and electricity prices, EPA concludes that

Option 6 would not reduce electricity production in excess of 1 billion kilowatt hours per day.

 ̃ Installed capacity

None of the evaluated options contain requirements that would permanently reduce installed capacity, for

example through parasitic losses or auxiliary power requirements. However, the rule does contain requirements

that may lead to one-time temporary downtimes of up to nine weeks of steam electric generators subject to Phase

III regulation. EPA estimates that under Option 6 approximately four facilities, accounting for 145 megawatts

(MW) of generating capacity, would experience such downtimes. However, EPA’s analyses indicate that these

downtimes would not have a significant adverse effect on the supply, distribution, or use of energy (see the

Appendix to Chapter B5: Economic Impact Analysis for Electric Generators). In addition, EPA estimates that

Option 6 would lead to only 173 MW in incremental permanent capacity closures, well below the 500 MW

impact threshold.

 ̃ Energy prices

Option 6 would not significantly affect energy prices in either the long run or the short run. EPA estimates that,

in the long run, energy prices would rise by less than 1% in all but one North American Electric Reliability

Council (NERC) regions. The Electric Reliability Council of Texas (ERCOT) is estimated to have the largest

increase in electricity prices with 1.1% in 2010 and 5.2% in 2013. No other region would experience energy price

increases of more than 0.2% as a result of Phase III regulation.

 ̃ Dependence on foreign supplies of energy

EPA’s electricity market analysis did not allow for an explicit consideration of effects on foreign imports of

energy. However, Electric Generators which are generally not subject to significant foreign competition. (Only

Canada and Mexico are connected to the U.S. electricity grid, and transmission losses are substantial when

electricity is transmitted over long distances.) In addition, the effects on installed capacity and electricity prices,

are estimated to be small. EPA therefore concludes that Option 6 would not significantly increase dependence on

foreign supplies of energy.
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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D3-6.2 New Offshore Oil and Gas Extraction Facilities

This rule applies only to new offshore oil and gas extraction facilities and not existing ones. Hence the rule

would have no impact on existing production of oil and gas, energy prices, installed capacity, nor would it

significantly increase dependence on foreign supplies of energy. EPA’s analysis identified no barriers to entry or

energy effects. EPA therefore concludes that the proposed rule would not significantly affect new offshore oil

and gas production, energy prices, or dependence on foreign supplies of energy.

Based on these analyses for potentially regulated existing and new facilities, EPA concludes that this proposed

rule would have minimal energy effects at a national and regional level. As a result, EPA did not prepare a

Statement of Energy Effects.

D3-7 NATIONAL TECHNOLOGY TRANSFER AND ADVANCEMENT ACT OF 1995

Section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) of 1995, Pub L. No. 104-

113, Sec. 12(d) directs EPA to use voluntary consensus standards in its regulatory activities unless doing so

would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical

standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are

developed or adopted by voluntary consensus standard bodies. The NTTAA directs EPA to provide Congress,

through the Office of Management and Budget (OMB), explanations when the Agency decides not to use

available and applicable voluntary consensus standards.

This proposed rule does not involve such technical standards. Therefore, EPA is not considering the use of any

voluntary consensus standards.

D3-8 EXECUTIVE ORDER 12898: FEDERAL ACTIONS TO ADDRESS ENVIRONMENTAL JUSTICE

IN MINORITY POPULATIONS AND LOW-INCOME POPULATIONS

Executive Order 12898 (59 FR 7629, February 11, 1994) requires that, to the greatest extent practicable and

permitted by law, each Federal agency must make achieving environmental justice part of its mission. E.O.

12898 provides that each Federal agency must conduct its programs, policies, and activities that substantially

affect human health or the environment in a manner that ensures such programs, policies, and activities do not

have the effect of (1) excluding persons (including populations) from participation in, or (2) denying persons

(including populations) the benefits of, or (3) subjecting persons (including populations) to discrimination under

such programs, policies, and activities because of their race, color, or national origin.

Today’s proposed rule requires that the location, design, construction, and capacity of cooling water intake

structures (CWIS) at Phase III facilities reflect the best technology available for minimizing adverse

environmental impact. For several reasons, EPA does not expect that this proposed rule would have an

exclusionary effect, deny persons the benefits of the participation in a program, or subject persons to

discrimination because of their race, color, or national origin. In fact, because EPA expects that this proposed

rule would help to preserve the health of aquatic ecosystems located in reasonable proximity to Phase III facilities,

it believes that all populations, including minority and low-income populations, would benefit from improved

environmental conditions as a result of this rule.

D3-9 EXECUTIVE ORDER 13158: MARINE PROTECTED AREAS

Executive Order 13158 (65 FR 34909, May 31, 2000) requires EPA to “expeditiously propose new science-based

regulations, as necessary, to ensure appropriate levels of protection for the marine environment.” EPA may take

action to enhance or expand protection of existing marine protected areas and to establish or recommend, as
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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appropriate, new marine protected areas. The purpose of the Executive Order is to protect the significant natural

and cultural resources within the marine environment, which means “those areas of coastal and ocean waters, the

Great Lakes and their connecting waters, and submerged lands thereunder, over which the United States exercises

jurisdiction, consistent with international law.” EPA expects that the Proposed Section 316(b) Rule for Phase III

Facilities would advance the objective of Executive Order 13158.

Marine protected areas (MPAs) include designated areas with varying levels of protection, from fishery closure

areas, to aquatic National Parks, Marine Sanctuaries, and Wildlife Refuges (NOAA, 2002). The Departments of

Commerce and the Interior are developing an inventory of MPAs in the U.S. that are protected and managed

under Federal, State, Territorial, Tribal, or local laws. This list has not been completed, but it currently includes

32 Federal sites in the New England region, 31 in the Middle Atlantic region, 43 in the South Atlantic region, 45

in the Gulf of Mexico region, 12 in the Caribbean region, 15 in the Great Lakes region, and 46 in the U.S. West

Coast region. Examples of marine protected areas include the Great Bay National Wildlife Refuge in New

Hampshire, the Cape Cod Bay Northern Right Whale Critical Habitat in Massachusetts, the Narragansett Bay

National Estuarine Research Reserve in Rhode Island, Everglades National Park and the Tortugas Shrimp

Sanctuary in Florida, and the Point Reyes National Seashore in California.

Marine protected areas can help address problems related to the depletion of marine resources by prohibiting, or

severely curtailing, activities that are permitted or regulated by law outside of marine protected areas. Such

activities include oil exploration, dredging, dumping, fishing, certain types of vessel traffic, and the focus of

section 316(b) rulemaking, the impingement and entrainment of aquatic organisms by cooling water intake

structures.

Impingement and entrainment affects many kinds of aquatic organisms, including fish, shrimp, crabs, birds, sea

turtles, and marine mammals. Aquatic environments are harmed both directly and indirectly by impingement and

entrainment of these organisms. In addition to the harm that results from the direct removal of organisms by

impingement and entrainment, there are the indirect effects on aquatic food webs that result from the impingement

and entrainment of organisms that serve as prey for predator species. There are also cumulative impacts that

result from multiple intake structures operating in the same local area, or when multiple intakes affect individuals

within the same population over a broad geographic range.

Decreased numbers of aquatic organisms resulting from the direct and indirect effects of impingement and

entrainment can have a number of consequences for marine resources, including impairment of food webs,

disruption of nutrient cycling and energy transfer within aquatic ecosystems, loss of native species, and reduction

of biodiversity. By reducing the impingement and entrainment of aquatic organisms, this proposed rule would not

only help protect individual species but also the overall marine environment, thereby advancing the objective of

Executive Order 13158 to protect marine areas.
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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REFERENCES

Executive Office of the President. 2001. Executive Order 13211. “Actions Concerning Regulations That

Significantly Affect Energy Supply, Distribution, or Use.” 66 FR 28355. May 22, 2001.

Executive Office of the President. 2000a. Executive Order 13175. “Consultation and Coordination with Indian

Tribal Governments.” 65 FR 67249, November 6, 2000.

Executive Office of the President. 2000b. Executive Order 13158. “Marine Protected Areas.” 65 FR 34909,

May 31, 2000.

Executive Office of the President. 1999. Executive Order 13132. “Federalism.” 64 FR 43255. August 10,

1999.

Executive Office of the President. 1997. Executive Order 13045. “Protection of Children from Environmental

Health Risks and Safety Risks.” 62 FR 19885, April 23, 1997.

Executive Office of the President. 1994. Executive Order 12898. “Federal Actions to Address Environmental

Justice in Minority Populations and Low-Income Populations.” 59 FR 7629, February 11, 1994.

Executive Office of the President. 1993. Executive Order 12866. “Regulatory Planning and Review.” 58 FR

51735. October 4, 1993.

National Oceanic and Atmospheric (NOAA) and U.S. Department of Commerce. 2002. Marine Protected Areas

of the United States. http://mpa.gov/welcome.html. Accessed 2/22/02.

Paperwork Reduction Act (PRA). 44 U.S.C. 3501 et seq.

U.S. Department of Commerce (U.S. DOC), Bureau of the Census. 2000. 2000 Census of Population and

Housing.

U.S. Department of Commerce (U.S. DOC), Bureau of the Census. 1998. 1998 Small Area Income and Poverty

Estimates.

U.S. Department of Energy (U.S. DOE), Energy Information Administration (EIA). 2000. Coal Industry Annual

2000 Data Tables, Table 106 Average Quality of Coal Received at Electric Utilities by Census Division and State,

1991, 1996-2000. Table data from Federal Energy Regulatory Commission, FERC Form 423, Monthly Report of

Cost and Quality of Fuels for Electric Plants. Accessed 11/24/03.

U.S. Department of the Interior (U.S. DOI), Fish and Wildlife Service, and U.S. Department of Commerce,

Bureau of the Census. 1997. 1996 National Survey of Fishing, Hunting, and Wildlife-Associated Recreation.

U.S. Environmental Protection Agency (U.S. EPA). 2004. Information Collection Request (ICR) for Cooling

Water Intake Structures Phase III Proposed Rule. ICR Number 2169.01. October 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part D: Additional Economic Analyses D3: Other Administrative Requirements

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§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

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Chapter E1: Summary of Social Costs

INTRODUCTION

This chapter presents EPA’s estimates of the costs to

society associated with the options evaluated for the

proposed rule for Phase III facilities. The social

costs of regulatory actions are the opportunity

costs to society of employing scarce resources to

reduce environmental damages. The social costs of

regulation include both monetary and non-monetary

outlays made by society. Monetary outlays include

the resource costs of compliance, government

administrative costs, and other adjustment costs, such as the cost of relocating displaced workers. Non-monetary

outlays, some of which can be assigned monetary values, include losses in consumers’ and producers’ surplus in

affected product markets, the adverse effects of involuntary unemployment, possible loss of time (e.g., delays in

investment decisions), and possible adverse impacts on the rate of innovation.

EPA’s estimates of social costs for the evaluated section 316(b) Phase III options include three components:

1. direct costs of complying with the regulation within each regulated industry segment,

2. cost to State governments in administering the regulation, and

3. cost to the Federal government in administering the regulation.

This chapter presents the social cost analysis for the three proposed options for existing facilities: the “50 MGD

for All Waterbodies” option (“50 MGD All”), the “200 MGD for All Waterbodies” option (“200 MGD All”), and

the “100 MGD for Certain Waterbodies” Option (“100 MGD CWB”). These options differ with regard to (1)

their design intake flow (DIF) applicability thresholds: 50, 100, and 200 MGD, respectively; and (2) the type of

waterbodies to which they would apply: the options with the 50 and 200 MGD applicability thresholds would

apply to all waterbody types while the option with the 100 MGD applicability threshold would apply only to

facilities withdrawing cooling water from certain waterbody types (i.e., an ocean, estuary, tidal river/stream or one

of the Great Lakes). Facilities meeting these applicability criteria would be required to meet similar performance

standards to those required in the final 316(b) Phase II rule, including a 80-95% reduction in impingement

mortality and a 60-90% reduction in entrainment. Facilities not meeting these applicability criteria would

continue to be subject to permit requirements based on the Director’s Best Professional Judgment (BPJ). As a

result, the number of facilities that would be required to meet the national requirements would vary among the

three proposed options. Of the three options presented here, the 100 MGD for Certain Waterbodies Option would

apply national categorical requirements to the smallest number of facilities, with the 200 MGD for All

Waterbodies Option and 50 MGD for All Waterbodies Option applying to successively larger numbers of

facilities.

This chapter also presents social costs for new offshore oil and gas extraction facilities (also abbreviated as “new

OOGE facilities”). The proposed requirements for this industry segment are based on a 2 MGD DIF applicability

threshold and would apply to an estimated 124 new offshore oil and gas extraction facilities.

E1-1 COSTS OF COMPLIANCE BY REGULATED INDUSTRY SEGMENT

The compliance costs used to estimate total social costs differ in their consideration of taxes from those in Part B:

Economic Analysis for Phase III Existing Facilities, and Part C: Economic Analysis for Phase III New Offshore

Oil and Gas Extraction Facilities, which were calculated for the purpose of estimating the private costs and

CHAPTER CONTENTS

E1-1 Costs of Compliance by Regulated Industry

Segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E1-1

E1-2 State and Federal Administrative Costs . . . . . . E1-4

E1-3 Total Social Cost . . . . . . . . . . . . . . . . . . . . . . . E1-4

E1-4 Limitations and Uncertainties . . . . . . . . . . . . E1-12

Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E1-13

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E1-14

Appendix to Chapter E1 . . . . . . . . . . . . . . . . . . . . . E1A-1
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

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 Because government facilities and cooperatives are not subject to income taxes, their costs are not adjusted for taxes.

2

 To the extent such impacts occur under any of the options analyzed.

3

 Including costs for regulatory closures yields an estimate of social costs assuming that all facilities, except those assessed as

baseline closures, would incur the costs of regulatory compliance and continue to operate post-regulation. Calculating costs as if all

facilities continue operating will overstate social costs if the social cost of compliance is greater than the net economic loss to society from

facility closure. Whether this result will hold depends, in part, on the difference between social and private discount rates, and the

marginal cost to society to replace the lost production of goods and services in closing facilities.

E1-2

impacts of the evaluated options. For the impact analyses, compliance costs are measured according to their

effect on the financial performance of the regulated facilities and firms. The analyses therefore explicitly consider

the tax deductibility of compliance outlays.1

 In the analysis of costs to society, however, these compliance costs

are considered on a pre-tax basis. The costs to society are the full value of the resources used, whether they are

paid for by the regulated facilities or by all taxpayers in the form of lost tax revenues.

EPA included no costs for facilities that were assessed as baseline closures or that are subject to permit

specifications based on best professional judgement (BPJ), instead of the proposed rule’s national categorical

requirements. However, EPA’s estimates do include compliance costs for facilities estimated to close because of

the rule.2

 This approach may overstate the social costs of compliance, to the extent that the net economic loss to

society in facility closures is less than the estimated cost to society of compliance.3

To assess the cost to society of complying with Phase III regulation, EPA estimated the costs to facilities for the

labor, equipment, materials, and other economic resources needed to comply with each evaluated option. In this

analysis, EPA assumed that the market prices for labor, equipment, materials, and other compliance resources

represent the opportunity costs to society for use of those resources in regulatory compliance.

For the analysis of installation downtime in the Electric Generators and Manufacturers segment, EPA assumed

that the cost of society is equal to the increase in production cost for providing the electricity or other replacement

goods and services not provided by the facilities that incur downtime in reaching compliance with the 316(b)

Phase III regulation. For both Electric Generators and Manufacturers, this cost is approximated as the lost

revenue from installation downtime less the variable cost of producing the electricity or other goods and services

not produced due to the installation downtime. Implicit in this assumption is that the variable production cost of

replacing the electricity or other lost goods and services is essentially the same as the price received for the sale of

the electricity or other goods and services not produced by the facilities incurring the installation downtime. For

electricity, this assumption is consistent with the electricity market concept that the variable production cost of the

last generating unit to be dispatched is approximately the same as the price received for the last unit of

production. For the goods and services not produced by affected Manufacturers facilities, the assumption is

likewise consistent with a competitive market model of increasing marginal production cost, such that the

production cost of the “last” or highest cost goods and services produced and sold in any period is approximately

equal to the price received for those goods and services in the market. For Manufacturers – which do not

necessarily produce and sell goods in as orderly markets as electric generators and where, as a result, the cost of

producing replacement goods and services may be less than selling price – this assumption may overstate the cost

to society of installation downtime. Absent specific knowledge of the overall production cost structure of the

affected industries, EPA adopted this conservative assumption for its analysis of the social cost of Phase III

regulation.

EPA estimates that the offshore oil and gas extraction industry segment would not incur cost from installation

downtime because only new offshore oil and gas extraction facilities would be regulated under this proposed rule. 

The potential disruption in ongoing business operation estimated for existing Manufacturers and Electric

Generators is not relevant for new facilities.

Finally, EPA assumes in its social cost analysis that none of the evaluated options would affect the aggregate

quantity of goods and services sold to consumers by producers in the affected industry segments. The resource

costs of compliance therefore manifest only as a reduction in the total of producers’ surplus and consumers’
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

4

 Tables E1-4 through E1-6 below present the time profiles of regulatory costs associated with each of the proposed options for

existing facilities, combined with the proposed option for new offshore oil and gas extraction facilities.

E1-3

surplus, with no change in the quantity of goods and services produced and consumed. In the impact analyses,

specific assumptions are made about the distribution of this effect between producers and consumers (i.e., the

impact analyses of all analyzed section 316(b) Phase III industry segments – Manufacturers, Electric Generators,

and new offshore oil and gas extraction facilities – assume that all compliance costs are absorbed by complying

businesses with no increase in prices to consumers). However, for the social cost analysis, the distribution of this

effect between producers and consumers is irrelevant. Given the very small impact of the options on total costs

within the industry segments, EPA believes the assumption of no effect on total quantity of goods and services

produced and consumed is reasonable.

Table E1-1 below summarizes total direct facility costs for the proposed rule new offshore oil and gas extraction

facilities combined with the three proposed options for existing facilities. As described in Chapter B1: Summary

of Cost Categories and Key Analysis Elements for Existing Facilities and Chapter C1: Summary of Cost

Categories and Key Analysis Elements for New Offshore Oil and Gas Extraction Facilities, costs were first tallied

on an as-incurred, year-by-year basis over the total time period of analysis, considering the latest year in which

any affected facility is assumed to reach compliance (2014 for existing facilities, 2026 for new offshore oil and

gas extraction facilities) and for a period of 30 years in which facilities are assumed to continue compliance, for

the purposes of the social cost analysis. Thus, for the social cost analysis, the analysis period extends to 2055 for

new facilities and to 2043 for existing facilities.4

 These profiles of costs by year were then discounted to the

assumed year when this proposed rule would take effect, beginning of year 2007, at two values of the discount

rate, 3% and 7%. These discount rate values reflect guidance from the Office of Management and Budget (OMB)

regulatory analysis guidance document, Circular A-4 (OMB, 2003). After calculating the present value of these

cost streams, EPA calculated their constant annual equivalent value (annualized value) using the annualization

formula presented in Chapter B1, again using the two values of the discount rate, 3% and 7%.

Table E1-1: Summary of Annualized Direct Costs by Regulated Industry Segments

(in millions, 2003 $)

50 MGD All (Existing) /

2 MGD All (New)

200 MGD All (Existing) /

2 MGD All (New)

100 MGD CWB (Existing) /

2 MGD All (New)

3% 7% 3% 7% 3% 7%

Existing Manufacturing Facilities

Primary Manufacturing Industries $42.7 $45.1 $21.7 $23.1 $16.7 $17.4

Other Industries $4.1 $4.4 $1.0 $0.9 $0.7 $0.7

Existing Electric Generators $0.0 $0.0 $0.0 $0.0 $0.0 $0.0

Total Existing Facilitiesa $46.8 $49.5 $22.6 $24.0 $17.5 $18.1

New Oil & Gas Facilities $3.2 $2.7 $3.2 $2.7 $3.2 $2.7

Total Direct Facility Costsa $50.0 $52.2 $25.9 $26.7 $20.7 $20.8

a

 Individual numbers may not add up to totals due to independent rounding.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

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E1-2 STATE AND FEDERAL ADMINISTRATIVE COSTS

Social costs also include costs to State and Federal governments of administering the permitting and compliance

monitoring activities under the proposed regulation. State and Federal permitting authorities incur costs to

administer the rule, including labor costs to write permits and to conduct compliance monitoring and enforcement

activities. Chapter D2: UMRA Analysis presents more information on State and Federal implementation costs.

EPA’s estimate of State and Federal government cost for administering the proposed rule is comparatively minor

in relation to the estimated direct cost of regulatory compliance. At a 3% discount rate, EPA estimates

administrative costs of $0.98 million (50 MGD All Option), $0.54 million (200 MGD All Option), and $0.57

million (100 MGD CWB Option). At a 7% discount rate, these costs amount to $0.89 million (50 MGD All

Option), $0.45 million (200 MGD All Option), and $0.48 million (100 MGD CWB Option).

Table E1-2: Summary of Annualized Government Costs (in millions, 2003 $)

50 MGD All (Existing) /

2 MGD All (New)

200 MGD All (Existing) /

2 MGD All (New)

100 MGD CWB (Existing) /

2 MGD All (New)

3% 7% 3% 7% 3% 7%

Existing Facilities:

State Admin. Costs $0.55 $0.55 $0.12 $0.12 $0.15 $0.16

Federal Admin. Costs $0.01 $0.01 <$0.01 < $0.01 < $0.01 < $0.01

Total Existing Facilities Admin. Costa $0.56 $0.56 $0.12 $0.13 $0.15 $0.16

New OOGE Facilities:

State Admin. Costs n/a n/a n/a n/a n/a n/a

Federal Admin. Costs $0.42 $0.32 $0.42 $0.32 $0.42 $0.32

Total New OOGE Facilities Admin. Cost $0.42 $0.32 $0.42 $0.32 $0.42 $0.32

Total Gov. Admin. Costsa $0.98 $0.89 $0.54 $0.45 $0.57 $0.48

a Individual numbers may not add up to totals due to independent rounding.

Source: U.S. EPA Analysis, 2004.

E1-3 TOTAL SOCIAL COST

Table E1-3 combines the information presented above by industry segment and major cost category – direct

facility costs and administrative costs – and reports the total social costs of the three proposal options, discounted

at a 3% and 7% rate. At a 3% discount rate the estimated total annualized social costs are $51.0 million for the 50

MGD All Option, $26.4 million for the 200 MGD All Option, and $21.3 million for the 100 MGD CWB Option. 

At a 7% discount rate the estimated total annualized social costs are $53.1 million for the 50 MGD All Option,

$27.2 million for the 200 MGD All Option, and $21.3 million for the 100 MGD CWB Option (all values in

2003$).

As shown in Table E1-3, existing facilities account for the substantial majority of total social cost under all three

proposal options. Since no Electric Generators would be subject to the national requirements under any of the

three proposed options, Manufacturers account for all costs in the existing facilities segment. At a 3% discount

rate, annualized pre-tax costs per facility in the Manufacturers segment amount to $349,000 for the 50 MGD All

option, $920,000 for the 200 MGD All option, and $929,000 for the 100 MGD CWB option. At a 7% discount
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-5

rate, annualized pre-tax costs in the Manufacturers segment amount to $369,000 for the 50 MGD All option,

$974,000 for the 200 MGD All option, and $962,000 for the 100 MGD CWB option. Because the 200 MGD

option and the 100 MGD option apply national categorical requirements to a smaller number of facilities than the

50 MGD option, they result in a lower total national cost but a higher cost per regulated facility. Facilities that

are subject to the national requirements of the 200 MGD option and the 100 MGD option incur the same

compliance costs as under the 50 MGD option; however, the average costs per regulated facility are higher under

the 200 MGD and 100 MGD options because only the higher flow, and therefore higher cost, facilities incur costs

under these options. For facilities in the new offshore oil and gas extraction industry segment, per facility costs

under the proposed rule are approximately $30,000 at a 3% discount rate and $24,000 at a 7% discount rate.

Table E1-3: Summary of Annualized Social Costs (in millions, 2003 $)

50 MGD All

(Existing) / 2 MGD

All (New)

200 MGD All

(Existing) / 2 MGD

All (New)

100 MGD CWB

(Existing) / 2 MGD

All (New)

3% 7% 3% 7% 3% 7%

Existing Facilities:

Total Direct Facility Costs $46.8 $49.5 $22.6 $24.0 $17.5 $18.1

Total Government Administrative Costs $0.6 $0.6 $0.1 $0.1 $0.2 $0.2

Total Existing Facilities Social Cost $47.3 $50.1 $22.8 $24.1 $17.6 $18.3

New OOGE Facilities:

Total Direct Facility Costs $3.2 $2.7 $3.2 $2.7 $3.2 $2.7

Total Government Administrative Costs $0.4 $0.3 $0.4 $0.3 $0.4 $0.3

Total New OOGE Facilities Social Cost $3.7 $3.0 $3.7 $3.0 $3.7 $3.0

Total Social Cost $51.0 $53.1 $26.4 $27.2 $21.3 $21.3

a Individual numbers may not add up to totals due to independent rounding.

Source: U.S. EPA Analysis, 2004.

Tables E1-4 through E1-6, starting on the following page, provide additional detail on the compliance cost

calculations. The tables compile, for each of the three proposed options for existing facilities and the proposed

option for new offshore oil and gas extraction facilities, the time profiles of costs incurred by the regulated

industry segments, administrative costs, and total costs. The tables also report the calculated present and

annualized values of costs at 3% and 7% discount rates. Time profiles for other options evaluated for existing

facilities are presented in the appendix to this chapter.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-6

Table E1-4: Time Profile of Compliance Costs for the 50 MGD for All Waterbodies Option for Existing

Facilities and the Proposed Option for New OOGE Facilities (in millions; 2003$)

Year

Existing Facilities New OOGE Facilities

Total Regulated Industry

Segments Administrative

Costs Total O&G

Facilities

Administrative

Costs Total

Man. Generators

2007 $3.2 $0.0 $0.2 $3.3 $1.9 $0.0 $1.9 $5.2

2008 $10.2 $0.0 $0.0 $10.2 $1.7 $0.0 $1.7 $12.0

2009 $15.4 $0.0 $0.0 $15.4 $1.8 $0.0 $1.8 $17.2

2010 $171.6 $0.0 $1.1 $172.6 $1.1 $0.0 $1.1 $173.7

2011 $178.4 $0.0 $2.1 $180.5 $1.6 $0.0 $1.6 $182.2

2012 $73.4 $0.0 $1.1 $74.4 $1.9 $0.5 $2.4 $76.8

2013 $109.9 $0.0 $0.9 $110.8 $2.2 $0.1 $2.4 $113.2

2014 $21.9 $0.0 $0.3 $22.2 $2.1 $0.7 $2.7 $24.9

2015 $22.2 $0.0 $0.4 $22.7 $1.8 $0.3 $2.0 $24.7

2016 $17.8 $0.0 $0.7 $18.6 $1.6 $0.3 $1.9 $20.5

2017 $18.2 $0.0 $0.4 $18.6 $4.1 $0.5 $4.6 $23.2

2018 $14.9 $0.0 $0.4 $15.3 $2.7 $0.3 $3.0 $18.2

2019 $18.8 $0.0 $0.2 $19.0 $3.7 $0.5 $4.2 $23.2

2020 $44.1 $0.0 $0.4 $44.5 $2.8 $0.3 $3.2 $47.7

2021 $81.0 $0.0 $0.7 $81.7 $2.8 $0.4 $3.2 $85.0

2022 $28.8 $0.0 $0.4 $29.2 $4.8 $0.7 $5.5 $34.7

2023 $57.9 $0.0 $0.4 $58.2 $2.9 $0.4 $3.3 $61.5

2024 $21.9 $0.0 $0.2 $22.1 $4.4 $0.7 $5.1 $27.2

2025 $22.2 $0.0 $0.4 $22.7 $3.0 $0.4 $3.4 $26.1

2026 $17.8 $0.0 $0.7 $18.6 $2.9 $0.4 $3.3 $21.9

2027 $18.2 $0.0 $0.4 $18.6 $4.9 $0.7 $5.6 $24.2

2028 $14.9 $0.0 $0.4 $15.3 $2.8 $0.3 $3.1 $18.4

2029 $18.8 $0.0 $0.2 $19.0 $4.1 $0.7 $4.7 $23.7

2030 $44.1 $0.0 $0.4 $44.5 $2.8 $0.3 $3.1 $47.7

2031 $81.0 $0.0 $0.7 $81.7 $2.8 $0.3 $3.1 $84.9

2032 $28.8 $0.0 $0.4 $29.2 $5.1 $0.7 $5.8 $35.0

2033 $57.9 $0.0 $0.4 $58.2 $2.8 $0.3 $3.1 $61.4

2034 $21.9 $0.0 $0.2 $22.1 $4.6 $0.7 $5.2 $27.3

2035 $22.2 $0.0 $0.4 $22.7 $2.8 $0.3 $3.1 $25.8

2036 $17.8 $0.0 $0.7 $18.6 $2.8 $0.3 $3.1 $21.7
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

Table E1-4: Time Profile of Compliance Costs for the 50 MGD for All Waterbodies Option for Existing

Facilities and the Proposed Option for New OOGE Facilities (in millions; 2003$)

Year

Existing Facilities New OOGE Facilities

Total Regulated Industry

Segments Administrative

Costs Total O&G

Facilities

Administrative

Costs Total

Man. Generators

E1-7

2037 $18.2 $0.0 $0.4 $18.6 $3.9 $0.7 $4.6 $23.2

2038 $14.9 $0.0 $0.4 $15.3 $1.8 $0.3 $2.1 $17.4

2039 $14.2 $0.0 $0.2 $14.4 $3.0 $0.6 $3.6 $18.0

2040 $12.0 $0.0 $0.1 $12.1 $1.7 $0.3 $2.0 $14.1

2041 $6.2 $0.0 $0.1 $6.3 $1.7 $0.2 $1.9 $8.2

2042 $4.1 $0.0 $0.0 $4.1 $3.6 $0.5 $4.1 $8.3

2043 $0.5 $0.0 $0.0 $0.5 $1.6 $0.2 $1.8 $2.4

2044 $2.4 $0.4 $2.8 $2.8

2045 $1.5 $0.2 $1.7 $1.7

2046 $1.5 $0.2 $1.6 $1.6

2047 $2.1 $0.3 $2.4 $2.4

2048 $0.5 $0.1 $0.6 $0.6

2049 $1.0 $0.2 $1.3 $1.3

2050 $0.3 $0.1 $0.4 $0.4

2051 $0.2 $0.1 $0.3 $0.3

2052 $1.5 $0.1 $1.6 $1.6

2053 $0.1 $0.0 $0.2 $0.2

2054 $0.6 $0.1 $0.7 $0.7

2055 $0.0 $0.0 $0.1 $0.1

PV 3% $944.6 $0.0 $11.2 $955.8 $65.4 $8.5 $74.0 $1,029.8

Annualized 3% $46.8 $0.0 $0.6 $47.3 $3.2 $0.4 $3.7 $51.0

PV 7% $657.5 $0.0 $7.5 $665.0 $36.0 $4.3 $40.3 $705.3

Annualized 7% $49.5 $0.0 $0.6 $50.1 $2.7 $0.3 $3.0 $53.1

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-8

Table E1-5: Time Profile of Compliance Costs for the 200 MGD for All Waterbodies Option for Existing

Facilities and the Proposed Option for New OOGE Facilities (in millions; 2003$)

Year

Existing Facilities New OOGE Facilities

Total Regulated Industry

Segments Administrative

Costs Total O&G

Facilities

Administrative

Costs Total

Man. Generators

2007 $0.0 $0.0 $0.2 $0.2 $1.9 $0.0 $1.9 $2.1

2008 $1.4 $0.0 $0.0 $1.4 $1.7 $0.0 $1.7 $3.1

2009 $2.1 $0.0 $0.0 $2.1 $1.8 $0.0 $1.8 $3.9

2010 $129.1 $0.0 $0.0 $129.1 $1.1 $0.0 $1.1 $130.2

2011 $83.4 $0.0 $0.5 $83.8 $1.6 $0.0 $1.6 $85.4

2012 $12.1 $0.0 $0.1 $12.3 $1.9 $0.5 $2.4 $14.6

2013 $45.4 $0.0 $0.4 $45.8 $2.2 $0.1 $2.4 $48.1

2014 $7.4 $0.0 $0.1 $7.5 $2.1 $0.7 $2.7 $10.2

2015 $8.5 $0.0 $0.1 $8.5 $1.8 $0.3 $2.0 $10.6

2016 $7.4 $0.0 $0.2 $7.5 $1.6 $0.3 $1.9 $9.5

2017 $8.9 $0.0 $0.1 $9.0 $4.1 $0.5 $4.6 $13.5

2018 $7.4 $0.0 $0.1 $7.5 $2.7 $0.3 $3.0 $10.5

2019 $7.2 $0.0 $0.1 $7.3 $3.7 $0.5 $4.2 $11.5

2020 $12.7 $0.0 $0.0 $12.7 $2.8 $0.3 $3.2 $15.9

2021 $39.8 $0.0 $0.2 $40.0 $2.8 $0.4 $3.2 $43.2

2022 $14.6 $0.0 $0.1 $14.6 $4.8 $0.7 $5.5 $20.1

2023 $45.7 $0.0 $0.1 $45.8 $2.9 $0.4 $3.3 $49.1

2024 $7.3 $0.0 $0.1 $7.4 $4.4 $0.7 $5.1 $12.5

2025 $8.5 $0.0 $0.0 $8.5 $3.0 $0.4 $3.4 $11.9

2026 $7.4 $0.0 $0.2 $7.5 $2.9 $0.4 $3.3 $10.9

2027 $8.9 $0.0 $0.1 $9.0 $4.9 $0.7 $5.6 $14.6

2028 $7.4 $0.0 $0.1 $7.5 $2.8 $0.3 $3.1 $10.6

2029 $7.2 $0.0 $0.1 $7.3 $4.1 $0.7 $4.7 $12.0

2030 $12.7 $0.0 $0.0 $12.7 $2.8 $0.3 $3.1 $15.9

2031 $39.8 $0.0 $0.2 $40.0 $2.8 $0.3 $3.1 $43.1

2032 $14.6 $0.0 $0.1 $14.6 $5.1 $0.7 $5.8 $20.4

2033 $45.7 $0.0 $0.1 $45.8 $2.8 $0.3 $3.1 $48.9

2034 $7.3 $0.0 $0.1 $7.4 $4.6 $0.7 $5.2 $12.7

2035 $8.5 $0.0 $0.0 $8.5 $2.8 $0.3 $3.1 $11.6

2036 $7.4 $0.0 $0.2 $7.5 $2.8 $0.3 $3.1 $10.7

2037 $8.9 $0.0 $0.1 $9.0 $3.9 $0.7 $4.6 $13.6
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

Table E1-5: Time Profile of Compliance Costs for the 200 MGD for All Waterbodies Option for Existing

Facilities and the Proposed Option for New OOGE Facilities (in millions; 2003$)

Year

Existing Facilities New OOGE Facilities

Total Regulated Industry

Segments Administrative

Costs Total O&G

Facilities

Administrative

Costs Total

Man. Generators

E1-9

2038 $7.4 $0.0 $0.1 $7.5 $1.8 $0.3 $2.1 $9.6

2039 $7.0 $0.0 $0.1 $7.1 $3.0 $0.6 $3.6 $10.6

2040 $6.7 $0.0 $0.0 $6.8 $1.7 $0.3 $2.0 $8.8

2041 $3.9 $0.0 $0.0 $3.9 $1.7 $0.2 $1.9 $5.9

2042 $3.0 $0.0 $0.0 $3.1 $3.6 $0.5 $4.1 $7.2

2043 $0.4 $0.0 $0.0 $0.4 $1.6 $0.2 $1.8 $2.2

2044 $2.4 $0.4 $2.8 $2.8

2045 $1.5 $0.2 $1.7 $1.7

2046 $1.5 $0.2 $1.6 $1.6

2047 $2.1 $0.3 $2.4 $2.4

2048 $0.5 $0.1 $0.6 $0.6

2049 $1.0 $0.2 $1.3 $1.3

2050 $0.3 $0.1 $0.4 $0.4

2051 $0.2 $0.1 $0.3 $0.3

2052 $1.5 $0.1 $1.6 $1.6

2053 $0.1 $0.0 $0.2 $0.2

2054 $0.6 $0.1 $0.7 $0.7

2055 $0.0 $0.0 $0.1 $0.1

PV 3% $457.2 $0.0 $2.5 $459.7 $65.4 $8.5 $74.0 $533.6

Annualized 3% $22.6 $0.0 $0.1 $22.8 $3.2 $0.4 $3.7 $26.4

PV 7% $318.7 $0.0 $1.7 $320.3 $36.0 $4.3 $40.3 $360.6

Annualized 7% $24.0 $0.0 $0.1 $24.1 $2.7 $0.3 $3.0 $27.2

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-10

Table E1-6: Time Profile of Compliance Costs for the 100 MGD for Certain Waterbodies Option for

Existing Facilities and the Proposed Option for New OOGE Facilities (in millions; 2003$)

Year

Existing Facilities New OOGE Facilities

Total Regulated Industry

Segments Administrative

Costs Total O&G

Facilities

Administrative

Costs Total

Man. Generators

2007 $0.4 $0.0 $0.2 $0.6 $1.9 $0.0 $1.9 $2.5

2008 $3.8 $0.0 $0.0 $3.8 $1.7 $0.0 $1.7 $5.6

2009 $3.9 $0.0 $0.0 $3.9 $1.8 $0.0 $1.8 $5.7

2010 $8.8 $0.0 $0.2 $9.0 $1.1 $0.0 $1.1 $10.1

2011 $138.9 $0.0 $0.8 $139.7 $1.6 $0.0 $1.6 $141.4

2012 $11.4 $0.0 $0.1 $11.5 $1.9 $0.5 $2.4 $13.9

2013 $34.9 $0.0 $0.4 $35.3 $2.2 $0.1 $2.4 $37.7

2014 $5.3 $0.0 $0.0 $5.4 $2.1 $0.7 $2.7 $8.1

2015 $8.2 $0.0 $0.1 $8.3 $1.8 $0.3 $2.0 $10.4

2016 $5.2 $0.0 $0.3 $5.4 $1.6 $0.3 $1.9 $7.4

2017 $6.5 $0.0 $0.1 $6.6 $4.1 $0.5 $4.6 $11.2

2018 $5.2 $0.0 $0.1 $5.3 $2.7 $0.3 $3.0 $8.3

2019 $5.2 $0.0 $0.0 $5.2 $3.7 $0.5 $4.2 $9.5

2020 $8.2 $0.0 $0.1 $8.3 $2.8 $0.3 $3.2 $11.5

2021 $41.1 $0.0 $0.3 $41.4 $2.8 $0.4 $3.2 $44.6

2022 $12.2 $0.0 $0.1 $12.2 $4.8 $0.7 $5.5 $17.7

2023 $35.3 $0.0 $0.1 $35.4 $2.9 $0.4 $3.3 $38.7

2024 $5.3 $0.0 $0.0 $5.4 $4.4 $0.7 $5.1 $10.5

2025 $8.2 $0.0 $0.1 $8.3 $3.0 $0.4 $3.4 $11.7

2026 $5.2 $0.0 $0.3 $5.4 $2.9 $0.4 $3.3 $8.8

2027 $6.5 $0.0 $0.1 $6.6 $4.9 $0.7 $5.6 $12.2

2028 $5.2 $0.0 $0.1 $5.3 $2.8 $0.3 $3.1 $8.4

2029 $5.2 $0.0 $0.0 $5.2 $4.1 $0.7 $4.7 $10.0

2030 $8.2 $0.0 $0.1 $8.3 $2.8 $0.3 $3.1 $11.4

2031 $41.1 $0.0 $0.3 $41.4 $2.8 $0.3 $3.1 $44.5

2032 $12.2 $0.0 $0.1 $12.2 $5.1 $0.7 $5.8 $18.0

2033 $35.3 $0.0 $0.1 $35.4 $2.8 $0.3 $3.1 $38.6

2034 $5.3 $0.0 $0.0 $5.4 $4.6 $0.7 $5.2 $10.6

2035 $8.2 $0.0 $0.1 $8.3 $2.8 $0.3 $3.1 $11.4

2036 $5.2 $0.0 $0.3 $5.4 $2.8 $0.3 $3.1 $8.6

2037 $6.5 $0.0 $0.1 $6.6 $3.9 $0.7 $4.6 $11.2

2038 $5.2 $0.0 $0.1 $5.3 $1.8 $0.3 $2.1 $7.4

2039 $4.8 $0.0 $0.0 $4.8 $3.0 $0.6 $3.6 $8.4

2040 $4.7 $0.0 $0.0 $4.7 $1.7 $0.3 $2.0 $6.7

2041 $2.2 $0.0 $0.0 $2.2 $1.7 $0.2 $1.9 $4.1

2042 $1.3 $0.0 $0.0 $1.3 $3.6 $0.5 $4.1 $5.4

2043 $0.4 $0.0 $0.0 $0.4 $1.6 $0.2 $1.8 $2.2
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

Table E1-6: Time Profile of Compliance Costs for the 100 MGD for Certain Waterbodies Option for

Existing Facilities and the Proposed Option for New OOGE Facilities (in millions; 2003$)

Year

Existing Facilities New OOGE Facilities

Total Regulated Industry

Segments Administrative

Costs Total O&G

Facilities

Administrative

Costs Total

Man. Generators

E1-11

2044 $2.4 $0.4 $2.8 $2.8

2045 $1.5 $0.2 $1.7 $1.7

2046 $1.5 $0.2 $1.6 $1.6

2047 $2.1 $0.3 $2.4 $2.4

2048 $0.5 $0.1 $0.6 $0.6

2049 $1.0 $0.2 $1.3 $1.3

2050 $0.3 $0.1 $0.4 $0.4

2051 $0.2 $0.1 $0.3 $0.3

2052 $1.5 $0.1 $1.6 $1.6

2053 $0.1 $0.0 $0.2 $0.2

2054 $0.6 $0.1 $0.7 $0.7

2055 $0.0 $0.0 $0.1 $0.1

PV 3% $352.8 $0.0 $3.1 $355.9 $65.4 $8.5 $74.0 $429.9

Annualized 3% $17.5 $0.0 $0.2 $17.6 $3.2 $0.4 $3.7 $21.3

PV 7% $240.4 $0.0 $2.1 $242.5 $36.0 $4.3 $40.3 $282.8

Annualized 7% $18.1 $0.0 $0.2 $18.3 $2.7 $0.3 $3.0 $21.3

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-12

E1-4 LIMITATIONS AND UNCERTAINTIES

EPA did not include in its estimate of social costs the cost associated with unemployment that may result from

facility closures. Potential unemployment-related costs would include the cost of administering unemployment

programs for workers who are projected to lose employment (but not the cost of unemployment benefits, which

are a transfer payment within society); and an estimate of the amount that workers would be willing to pay to

avoid involuntary unemployment. However, from its facility impact analysis, EPA estimates that no facilities

would close as a result of the proposed rule. EPA also did not recognize any possible savings in unemploymentrelated costs from jobs created by the rule as a negative cost (benefit) of the regulation. Accordingly, EPA

estimates a zero cost of unemployment for the proposed rule. 

Another key uncertainty factor in the analysis of costs to society is EPA’s estimate of the cost of installation

downtime in Manufacturers facilities. As described above, EPA adopted the conservative assumption that the

production cost for replacing the goods and services not provided by complying facilities due to installation

downtime would be approximately equal to the price received for those goods and services in the market. To the

extent that these replacement goods and services are produced at a cost less than selling price, this assumption

would lead to an overestimate of the cost to society of installation downtime. The amount of potential

overestimation is not known.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-13

GLOSSARY

consumer surplus: The value that consumers derive from goods and services above the price they have to pay

to obtain the goods and services.

opportunity cost: The lost value of alternative uses of resources (capital, labor, and raw materials) used in

regulatory compliance.

producer surplus: The difference between what producers’ earn on their output and the economic costs of

producing that output, including a normal return on capital.

social cost: The costs incurred by society as a whole as a result of the proposed rule. Social costs do not

include costs that are transfers among parties that do not represent a new cost overall.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E1: Summary of Social Costs

E1-14

REFERENCES

Office of Management and Budget (OMB). 2003. Circular A-4, Regulatory Analysis. September 17, 2003. 

Available at http://www.whitehouse.gov/omb/circulars/a004/a-4.pdf.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

E1A-1

Appendix to Chapter E1

INTRODUCTION

This appendix presents the social cost results for five

other options evaluated for potential Phase III

existing facilities. For all options, facility counts and

other results only include those potential Phase III

existing facilities that are (1) non-baseline closures

and (2) subject to national categorical requirements under the option. See Chapter B3: Economic Impact Analysis

for Manufacturers and Chapter B5: Summary of Electric Generator Costs for more information on baseline

closures and counts of facilities subject to national categorical requirements under each option. See the main

body of this chapter for a description of data sources and methodologies used in these analyses.

E1A-1 COSTS OF COMPLIANCE BY REGULATED INDUSTRY SEGMENT

Table E1A-1 below summarizes total direct facility costs for the five other options evaluated for existing

facilities, at a 3% and a 7% discount rate. For a description of this analysis, see section E1-1 above.

Table E1A-1: Summary of Annualized Direct Costs by Regulated Industry Segments

Existing Facilities (in millions, 2003$)

Option 3 Option 4 Option 2 Option 1 Option 6

3% Discount Rate

Manufacturers

Primary Manufacturing

Industries $58.2 $62.1 $66.2 $68.3 $85.9

Other Industries $4.4 $4.3 $4.4 $4.4 $5.2

Electric Generators $1.5 $0.7 $1.9 $2.2 $2.9

Total Direct Facility Costsa $64.1 $67.1 $72.6 $75.0 $94.0

7% Discount Rate

Manufacturers

Primary Manufacturing

Industries $62.5 $67.8 $71.7 $73.8 $92.5

Other Industries $4.7 $4.6 $4.7 $4.7 $5.5

Electric Generators $1.5 $0.7 $1.8 $2.1 $2.8

Total Direct Facility Costsa $68.7 $73.0 $78.3 $80.7 $100.8

a

 Individual numbers may not add up to totals due to independent rounding.

Source: U.S. EPA Analysis, 2004.

APPENDIX CONTENTS

E1A-1 Costs of Compliance by Regulated Industry 

Segment . . . . . . . . . . . . . . . . . . . . . . . . . . . . E1A-1

E1A-2 State and Federal Administrative Costs . . . . E1A-2

E1A-3 Total Social Cost . . . . . . . . . . . . . . . . . . . . . E1A-2
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

E1A-2

E1A-2 STATE AND FEDERAL ADMINISTRATIVE COSTS

Table E1A-2 presents annualized costs to State and Federal governments of administering the permitting and

compliance monitoring activities for the five other options evaluated for existing facilities, at a 3% and a 7%

discount rate. For a description of this analysis, see section E1-2 above.

Table E1A-2: Summary of Annualized Government Costs for Existing Facilities (in millions, 2003$)

Option 3 Option 4 Option 2 Option 1 Option 6

3% Discount Rate

State Admin. Costs $0.91 $0.81 $1.05 $1.08 $1.66

Federal Admin. Costs $0.02 $0.01 $0.02 $0.02 $0.03

Total Gov. Admin. Costsa $0.92 $0.83 $1.07 $1.10 $1.69

7% Discount Rate

State Admin. Costs $0.90 $0.81 $1.05 $1.08 $1.65

Federal Admin. Costs $0.02 $0.02 $0.02 $0.02 $0.04

Total Gov. Admin. Costsa $0.92 $0.83 $1.07 $1.10 $1.69

a Individual numbers may not add up to totals due to independent rounding.

Source: U.S. EPA Analysis, 2004.

E1A-3 TOTAL SOCIAL COST

Table E1A-3 presents the total social costs of the five other options evaluated for existing facilities, including

direct facility costs and government administrative costs, at a 3% and a 7% discount rate. Tables E1A-4 through

E1A-8 present the time profiles for the five other options. For a description of these analyses, see section E1-3

above.

Table E1A-3: Summary of Annualized Social Costs for Existing Facilities (in millions, 2003$)

Option 3 Option 4 Option 2 Option 1 Option 6

3% Discount Rate

Total Direct Facility Costs $64.1 $67.1 $72.6 $75.0 $94.0

Total Government Administrative Costs $0.9 $0.8 $1.1 $1.1 $1.7

Total Social Costa $65.0 $67.9 $73.7 $76.1 $95.7

7% Discount Rate

Total Direct Facility Costs $68.7 $73.0 $78.3 $80.7 $100.8

Total Government Administrative Costs $0.9 $0.8 $1.1 $1.1 $1.7

Total Social Costa $69.6 $73.9 $79.3 $81.8 $102.5

a Individual numbers may not add up to totals due to independent rounding.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

E1A-3

Table E1A-4: Time Profile of Compliance Costs for Existing Facilities - Option 3 (in millions; 2003$)

Year

Costs of Compliance by Regulated Industry

Segments Administrative Costs Total Cost

Manufacturers Generators

2007 $3.5 $0.2 $0.2 $3.9

2008 $14.0 $0.9 $0.0 $14.9

2009 $23.4 $1.4 $0.0 $24.8

2010 $184.6 $1.8 $1.6 $188.0

2011 $190.4 $3.0 $2.7 $196.1

2012 $277.3 $2.0 $2.3 $281.5

2013 $116.4 $1.0 $1.6 $119.0

2014 $28.1 $2.2 $0.8 $31.0

2015 $28.9 $1.0 $0.7 $30.6

2016 $26.7 $1.4 $1.0 $29.1

2017 $24.3 $0.7 $0.9 $25.9

2018 $18.6 $1.1 $0.7 $20.4

2019 $23.2 $1.4 $0.4 $25.0

2020 $52.9 $1.5 $0.7 $55.1

2021 $91.8 $2.8 $1.0 $95.6

2022 $36.8 $1.7 $0.9 $39.4

2023 $64.4 $1.1 $0.7 $66.1

2024 $28.0 $2.2 $0.4 $30.6

2025 $28.9 $1.0 $0.7 $30.6

2026 $26.7 $1.4 $1.0 $29.1

2027 $24.3 $0.7 $0.9 $25.9

2028 $18.6 $1.1 $0.7 $20.4

2029 $23.2 $1.4 $0.4 $25.0

2030 $52.9 $1.5 $0.7 $55.1

2031 $91.8 $2.8 $1.0 $95.6

2032 $36.8 $1.7 $0.9 $39.4

2033 $64.4 $1.1 $0.7 $66.1

2034 $28.0 $2.2 $0.4 $30.6

2035 $28.9 $1.0 $0.7 $30.6

2036 $26.7 $1.4 $1.0 $29.1

2037 $24.3 $0.7 $0.9 $25.9

2038 $18.6 $1.1 $0.7 $20.4

2039 $17.3 $0.6 $0.4 $18.3

2040 $14.6 $0.4 $0.2 $15.3

2041 $8.3 $0.3 $0.1 $8.8

2042 $5.1 $0.1 $0.1 $5.3

2043 $0.8 $0.1 $0.0 $1.0

PV 3% $1,263.6 $30.9 $18.7 $1,313.2

Annualized 3% $62.6 $1.5 $0.9 $65.0

PV 7% $892.1 $19.5 $12.2 $923.8

Annualized 7% $67.2 $1.5 $0.9 $69.6

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

E1A-4

Table E1A-5: Time Profile of Compliance Costs for Existing Facilities - Option 4 (in millions; 2003$)

Year

Costs of Compliance by Regulated Industry

Segments Administrative Costs Total Cost

Manufacturers Generators

2007 $3.2 $0.0 $0.2 $3.3

2008 $13.6 $0.3 $0.0 $13.9

2009 $22.4 $0.6 $0.0 $23.0

2010 $180.9 $0.6 $1.1 $182.6

2011 $291.4 $2.0 $3.0 $296.5

2012 $282.0 $0.5 $2.1 $284.6

2013 $115.6 $0.5 $1.5 $117.7

2014 $25.1 $1.3 $0.6 $27.0

2015 $28.8 $0.6 $0.5 $29.9

2016 $25.0 $0.7 $1.1 $26.8

2017 $23.7 $0.3 $0.8 $24.8

2018 $19.5 $0.6 $0.5 $20.7

2019 $22.0 $0.3 $0.3 $22.6

2020 $50.6 $0.6 $0.5 $51.8

2021 $89.8 $1.0 $1.1 $91.9

2022 $39.7 $0.3 $0.8 $40.8

2023 $64.0 $0.6 $0.5 $65.2

2024 $25.1 $1.2 $0.3 $26.6

2025 $28.8 $0.6 $0.5 $29.9

2026 $25.0 $0.7 $1.1 $26.8

2027 $23.7 $0.3 $0.8 $24.8

2028 $19.5 $0.6 $0.5 $20.7

2029 $22.0 $0.3 $0.3 $22.6

2030 $50.6 $0.6 $0.5 $51.8

2031 $89.8 $1.0 $1.1 $91.9

2032 $39.7 $0.3 $0.8 $40.8

2033 $64.0 $0.6 $0.5 $65.2

2034 $25.1 $1.2 $0.3 $26.6

2035 $28.8 $0.6 $0.5 $29.9

2036 $25.0 $0.7 $1.1 $26.8

2037 $23.7 $0.3 $0.8 $24.8

2038 $19.5 $0.6 $0.5 $20.7

2039 $17.4 $0.3 $0.3 $18.0

2040 $15.2 $0.3 $0.2 $15.7

2041 $8.4 $0.2 $0.1 $8.7

2042 $5.1 $0.1 $0.1 $5.2

2043 $0.8 $0.1 $0.0 $0.9

PV 3% $1,340.4 $14.1 $16.7 $1,371.2

Annualized 3% $66.4 $0.7 $0.8 $67.9

PV 7% $960.9 $8.9 $11.0 $980.8

Annualized 7% $72.4 $0.7 $0.8 $73.9

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

E1A-5

Table E1A-6: Time Profile of Compliance Costs for Existing Facilities - Option 2 (in millions; 2003$)

Year

Costs of Compliance by Regulated Industry

Segments Administrative Costs Total Cost

Manufacturers Generators

2007 $3.5 $0.2 $0.2 $3.9

2008 $15.0 $1.0 $0.0 $16.0

2009 $25.6 $1.8 $0.0 $27.4

2010 $187.5 $2.2 $1.6 $191.4

2011 $298.4 $3.8 $3.3 $305.5

2012 $286.1 $2.2 $2.9 $291.2

2013 $120.9 $1.2 $2.0 $124.1

2014 $30.2 $3.3 $0.9 $34.4

2015 $31.7 $1.2 $0.7 $33.6

2016 $29.5 $1.9 $1.2 $32.7

2017 $26.9 $0.9 $1.1 $28.8

2018 $22.1 $1.4 $0.7 $24.2

2019 $25.3 $1.6 $0.5 $27.3

2020 $55.6 $1.8 $0.7 $58.2

2021 $96.0 $2.8 $1.2 $100.0

2022 $43.6 $1.9 $1.1 $46.6

2023 $69.4 $1.4 $0.7 $71.4

2024 $30.1 $3.3 $0.5 $33.9

2025 $31.7 $1.2 $0.7 $33.6

2026 $29.5 $1.9 $1.2 $32.7

2027 $26.9 $0.9 $1.1 $28.8

2028 $22.1 $1.4 $0.7 $24.2

2029 $25.3 $1.6 $0.5 $27.3

2030 $55.6 $1.8 $0.7 $58.2

2031 $96.0 $2.8 $1.2 $100.0

2032 $43.6 $1.9 $1.1 $46.6

2033 $69.4 $1.4 $0.7 $71.4

2034 $30.1 $3.3 $0.5 $33.9

2035 $31.7 $1.2 $0.7 $33.6

2036 $29.5 $1.9 $1.2 $32.7

2037 $26.9 $0.9 $1.1 $28.8

2038 $22.1 $1.4 $0.7 $24.2

2039 $19.4 $0.8 $0.5 $20.7

2040 $16.7 $0.6 $0.2 $17.6

2041 $9.7 $0.5 $0.2 $10.3

2042 $5.9 $0.2 $0.1 $6.2

2043 $1.1 $0.2 $0.0 $1.3

PV 3% $1,427.1 $38.6 $21.6 $1,487.3

Annualized 3% $70.7 $1.9 $1.1 $73.7

PV 7% $1,014.8 $24.3 $14.2 $1,053.3

Annualized 7% $76.4 $1.8 $1.1 $79.3

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

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Table E1A-7: Time Profile of Compliance Costs for Existing Facilities - Option 1 (in millions; 2003$)

Year

Costs of Compliance by Regulated Industry

Segments Administrative Costs Total Cost

Manufacturers Generators

2007 $3.5 $0.2 $0.2 $3.9

2008 $15.1 $1.0 $0.0 $16.1

2009 $26.1 $1.8 $0.0 $27.9

2010 $201.3 $3.1 $1.7 $206.0

2011 $299.7 $4.0 $3.3 $306.9

2012 $290.1 $2.6 $3.1 $295.9

2013 $122.0 $1.4 $2.0 $125.3

2014 $31.3 $3.8 $1.0 $36.1

2015 $32.7 $1.4 $0.8 $34.9

2016 $31.1 $2.2 $1.2 $34.5

2017 $27.9 $1.1 $1.1 $30.2

2018 $23.1 $1.6 $0.7 $25.4

2019 $26.4 $1.8 $0.5 $28.6

2020 $58.6 $2.4 $0.7 $61.7

2021 $97.6 $3.0 $1.2 $101.8

2022 $47.7 $2.3 $1.1 $51.2

2023 $70.4 $1.6 $0.7 $72.7

2024 $31.2 $3.3 $0.5 $35.0

2025 $32.7 $1.4 $0.7 $34.9

2026 $31.1 $2.2 $1.2 $34.5

2027 $27.9 $1.1 $1.1 $30.2

2028 $23.1 $1.6 $0.7 $25.4

2029 $26.4 $1.8 $0.5 $28.6

2030 $58.6 $2.4 $0.7 $61.7

2031 $97.6 $3.0 $1.2 $101.8

2032 $47.7 $2.3 $1.1 $51.2

2033 $70.4 $1.6 $0.7 $72.7

2034 $31.2 $3.3 $0.5 $35.0

2035 $32.7 $1.4 $0.7 $34.9

2036 $31.1 $2.2 $1.2 $34.5

2037 $27.9 $1.1 $1.1 $30.2

2038 $23.1 $1.6 $0.7 $25.4

2039 $20.4 $1.0 $0.5 $21.9

2040 $17.6 $0.8 $0.2 $18.6

2041 $10.6 $0.6 $0.2 $11.4

2042 $5.9 $0.3 $0.1 $6.2

2043 $1.1 $0.3 $0.0 $1.4

PV 3% $1,469.5 $43.9 $22.3 $1,535.7

Annualized 3% $72.8 $2.2 1.1 $76.1

PV 7% $1,043.3 $27.6 $14.6 $1,085.6

Annualized 7% $78.6 $2.1 $1.1 $81.8

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

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Table E1A-8: Time Profile of Compliance Costs for Existing Facilities - Option 6 (in millions; 2003$)

Year

Costs of Compliance by Regulated Industry

Segments Administrative Costs Total Cost

Manufacturers Generators

2007 $5.5 $0.2 $0.2 $6.0

2008 $22.8 $1.0 $0.0 $23.8

2009 $36.7 $2.0 $0.0 $38.7

2010 $259.6 $3.5 $3.0 $266.2

2011 $400.0 $5.2 $5.0 $410.1

2012 $308.6 $4.0 $4.1 $316.7

2013 $131.9 $2.6 $3.1 $137.6

2014 $42.8 $4.9 $1.9 $49.6

2015 $43.7 $1.8 $1.3 $46.8

2016 $40.1 $2.5 $1.9 $44.5

2017 $37.6 $2.0 $1.5 $41.1

2018 $31.6 $2.8 $1.1 $35.5

2019 $36.5 $2.2 $0.8 $39.6

2020 $72.5 $2.7 $1.3 $76.5

2021 $124.3 $3.4 $1.8 $129.5

2022 $65.0 $3.2 $1.5 $69.7

2023 $80.3 $2.9 $1.1 $84.3

2024 $42.6 $4.2 $0.8 $47.7

2025 $43.7 $1.8 $1.3 $46.7

2026 $40.1 $2.5 $1.8 $44.5

2027 $37.6 $2.0 $1.5 $41.1

2028 $31.6 $2.8 $1.1 $35.5

2029 $36.5 $2.2 $0.8 $39.6

2030 $72.5 $2.7 $1.3 $76.5

2031 $124.3 $3.4 $1.8 $129.5

2032 $65.0 $3.2 $1.5 $69.7

2033 $80.3 $2.9 $1.1 $84.3

2034 $42.6 $4.2 $0.8 $47.7

2035 $43.7 $1.8 $1.3 $46.7

2036 $40.1 $2.5 $1.8 $44.5

2037 $37.6 $2.0 $1.5 $41.1

2038 $31.6 $2.8 $1.1 $35.5

2039 $26.5 $1.3 $0.8 $28.7

2040 $22.2 $1.1 $0.3 $23.6

2041 $13.0 $0.9 $0.2 $14.2

2042 $7.5 $0.5 $0.1 $8.1

2043 $1.7 $0.5 $0.0 $2.2

PV 3% $1,839.0 $58.8 $34.2 $1,932.0

Annualized 3% $91.1 $2.9 $1.7 $95.7

PV 7% $1,301.3 $36.6 $22.4 $1,360.3

Annualized 7% $98.0 $2.8 $1.7 $102.5

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E1

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Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Chapter E2: Summary of Benefits

INTRODUCTION

This chapter summarizes the EPA’s benefits analysis

conducted in developing the Proposed Section

316(b) Rule for Phase III Facilities and presents the

total monetary value of regional and national

baseline losses and of benefits of the three proposed

options for Phase III existing facilities:

< the “50 MGD for All Waterbodies” option

(“50 MGD All”),

< the “200 MGD for All Waterbodies” option (“200 MGD All”), and 

< the “100 MGD for Certain Waterbodies” option (“100 MGD CWB”).

Benefits results for five other options evaluated by EPA, but not proposed, are presented in the appendix to this

chapter.

The Regional Benefits Assessment for the Proposed Section 316(b) Rule for Phase III Facilities (RBA) provides

greater detail on the methods and data used in the regional analyses (U.S. EPA, 2004). See Chapter A1 for a

discussion of the methods used to estimate impingement and entrainment (I&E), and see Chapters A2 through A9

for discussion of the methods used to estimate the value of I&E losses and the benefits of the options evaluated

for the proposed rule. The results of the regional analyses are presented in Parts B through G of the RBA.

EPA was unable to assess benefits of reducing I&E at new offshore oil and gas extraction facilities due to

significant data gaps at the time of proposal. Therefore, the benefits estimates presented in this section are

underestimates because they do not reflect benefits associated with reducing I&E at new offshore oil and gas

extraction facilities.

E2-1 CALCULATING LOSSES AND BENEFITS

EPA’s analysis of national baseline losses and benefits under the evaluated options includes 603 sample-weighted

facilities in seven case study regions, excluding facilities that are expected to close in the baseline. The Agency

calculated baseline losses by summing losses from all 603 facilities. EPA’s estimates of benefits are based on

only those facilities that have requirements under each option.

Quantifying and monetizing reductions in I&E due to the evaluated options considered for the proposed rule is

challenging. As described in Chapters A3 and A6 of the RBA, EPA has estimated non-use values only

qualitatively and, as a result, the estimated total benefits of the evaluated options reflect use values only. The

RBA discusses specific limitations and uncertainties associated with estimation of commercial and recreational

benefits at the regional level. National benefit estimates, which are based on the regional estimates, are subject to

the same uncertainties. The overall effect of these uncertainties is of unknown magnitude and direction (i.e., the

estimates may over- or understate the anticipated national-level of use benefits); however, EPA has no data to

indicate that the results for any of the benefit categories are atypical or unreasonable. 

CHAPTER CONTENTS

E2-1 Calculating Losses and Benefits . . . . . . . . . . . E2-1

E2-2 Summary of Baseline Losses and Expected

Reductions in I&E . . . . . . . . . . . . . . . . . . . . . . E2-2

E2-3 Time Profile of Benefits . . . . . . . . . . . . . . . . . . E2-4

E2-4 Total Annualized Monetary Value of Losses

and Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . E2-10

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E2-15

Appendix to Chapter E2 . . . . . . . . . . . . . . . . . . . . . . E2A-1
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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E2-2 SUMMARY OF BASELINE LOSSES AND EXPECTED REDUCTIONS IN I&E

Based on the results of the regional analyses, EPA calculated total baseline I&E losses and the amount by which

these losses would be reduced under each of the evaluated options. Losses are presented using two measures of

I&E:

1. Age-one equivalent losses – the number of individual fish of different ages impinged and entrained by

facility intakes, expressed as age-one equivalents; and

2. Foregone fishery yield – pounds of commercial harvest and numbers of recreational fish and shellfish that

are not harvested due to I&E, including indirect losses of harvested species due to losses of forage

species.

Table E2-1 presents baseline I&E losses for both measures. As reported in Table E2-1, EPA estimates total

national losses of age-one equivalents for all 603 facilities of 120 million fish. Nationwide, EPA estimates that

4.2 million pounds of fishery yield per year is foregone under current rates of I&E. Approximately 37% of all

age-one equivalent losses, or 44.2 million fish, occur in the Inland region. The Gulf of Mexico region has the

highest foregone fishery yields with approximately 2 million pounds, followed by the Mid-Atlantic region with

approximately 0.9 million pounds. More detailed discussions of the I&E losses in each region are provided in

Parts B through G of the RBA.

Table E2-1: Total Annual Baseline I&E Losses for Potential Phase III Existing Facilities by Region

(thousands)

Region Age-One Equivalents Foregone Fishery Yield (lbs)

California 1,310 96

North Atlantic 2,340 45

Mid-Atlantic 23,200 920

South Atlantic 1,520 123

Gulf of Mexico 12,700 1,990

Great Lakes 34,400 489

Inland 44,200 495

National Total 120,000 4,160

Source: U.S. EPA Analysis, 2004.

To gauge the expected benefits of the proposed options, EPA estimated the extent to which these options would

reduce the estimated baseline losses. These avoided losses are based on the expected reductions in I&E at each

facility from implementation of the required compliance technologies. Table E2-2 reports, by region and option,

the expected percent reductions in I&E, and the estimated quantities of reduction in (1) losses in age-one

equivalents and (2) foregone fishery yield. At the national level, EPA estimates that the 50 MGD All option

would reduce age-one equivalent losses by 49.5 million fish and fishery yield loss by 2.2 million pounds. In

comparison, the 200 MGD All option and the 100 MGD CWB option apply to smaller numbers of facilities and

would result in slightly smaller reductions in I&E. The 200 MGD All option would reduce age-one equivalent

losses by 34.0 million fish and fishery yield losses by 1.4 million pounds. The 100 MGD All option would

reduce age-one equivalent losses by 29.8 million fish and fishery yield losses by 1.9 million pounds.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-3

The study regions show substantial variation in the estimated reductions in I&E losses and avoided losses in ageone equivalents and foregone fishery yield. As reported in Table E2-2, the largest percentage reductions in I&E

occur in the Gulf of Mexico for both the 50 MGD All and 100 MGD CWB options with 76% and 57%,

respectively. The 200 MGD All option has the largest reductions in I&E in the Mid-Atlantic region with 65% and

49%, respectively.

Percentage reductions in entrainment are less substantial, overall, than the impingement reductions. However, the

Great Lakes region shows larger percentage reductions in entrainment than impingement for each of the three

proposed options, where entrainment reductions range from 37% to 43%, and impingement reductions are 21% to

33%.

In terms of avoided age-one equivalent losses, the Inland region accounts for the largest reductions for the 50

MGD All option with approximately 30% of avoided losses. Under the 200 MGD All and the 100 MGD CWB

options, the Mid-Atlantic region accounts for the largest reductions in total avoided age-one equivalent losses

with 35% and 40%, respectively. 

On the basis of avoided losses in fishery yield, the Gulf of Mexico generates the greatest benefits under each of

the three options, followed by the Mid-Atlantic region. Together, these two regions account for 83%, 84%, and

92% of the avoided fishery yield losses achieved by the 50 MGD All, the 200 MGD All, and the 100 MGD CWB

options, respectively. 

More detailed discussions of regional benefits are provided in Parts B through G of the RBA.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Table E2-2: Expected Reduction in I&E for Phase III Existing Facilities by Option and Region

Region

Number of

Facilities

Installing

Technology

Impingement Entrainment

Age-One

Equivalents

(thousands)

Foregone Fishery

Yield 

(thousands; lbs)

50 MGD All Option

California 1 39% 29% 383 28

North Atlantic 4 43% 40% 930 18

Mid-Atlantic 3 73% 55% 13,400 600

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 7 76% 57% 8,380 1,250

Great Lakes 19 33% 43% 11,600 169

Inland 69 37% 27% 14,800 157

National Total 103 49,493 2,222

200 MGD All Option

Californiab 0 0% 0% 0 0

North Atlantic 1 11% 8% 198 4

Mid-Atlantic 2 65% 49% 11,900 534

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 2 41% 31% 4,580 682

Great Lakes 5 21% 37% 7,710 116

Inland 12 22% 21% 9,650 107

National Total 22 34,038 1,443

100 MGD CWB Option

Californiab 0 0% 0% 0 0

North Atlantic 3 43% 32% 754 15

Mid-Atlantic 2 65% 49% 11,900 534

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 7 76% 57% 8,380 1,250

Great Lakes 6 24% 40% 8,740 130

Inlandc 0 0% 0% 0 0

National Total 18 29,774 1,929

a

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 50 MGD and therefore would not be required to install technologies to comply with the proposed options. b

 No I&E reductions are expected in the California region because all potentially regulated facilities in this region withdraw less

than 100 MGD and therefore would not be required to install technologies to comply with the 200 MGD All and the 100 MGD

CWB options. c

 The 100 MGD CWB option would not apply national categorical requirements to facilities located on freshwater rivers and

lakes/reservoirs. Thus, no I&E reductions are expected at the potentially regulated facilities in the Inland region.

Source: U.S. EPA Analysis, 2004.

E2-3 TIME PROFILE OF BENEFITS

To account for the difference in timing of benefits and costs, EPA developed a time profile of total benefits from

all Phase III facilities that reflects when benefits from each facility would be realized. For each study region,
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-5

EPA first calculated the undiscounted commercial and recreational fishing benefits from the expected annual I&E

reductions under the proposed options, based on the assumptions that all facilities in each region have achieved

compliance with the rule and that benefits are realized immediately following compliance. Then, since there are

regulatory and biological time lags between promulgation of the rule and the realization of benefits, EPA created

a time profile of benefits that takes into account the fact that benefits do not begin immediately. The development

of the time profile of benefits is discussed in detail in Chapter A8: Discounting Benefits.

Table E2-3 below provides the time profile of the monetary value of baseline I&E losses, by region. EPA

developed similar time profiles for monetary benefits for the three proposed options for Phase III existing

facilities (see Tables E2-4, E2-5, and E2-6).
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Table E2-3: Time Profile of Mean Monetary Value of Total Baseline I&E Losses (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlantic

Gulf of

Mexico Great Lakes Inland National 

Total

2007 $0 $0 $0 $0 $111 $118 $112 $341

2008 $12 $20 $111 $8 $222 $236 $224 $833

2009 $23 $41 $222 $16 $887 $945 $897 $3,031

2010 $93 $163 $889 $65 $998 $1,063 $1,009 $4,280

2011 $105 $183 $1,001 $73 $1,054 $1,122 $1,065 $4,602

2012 $110 $194 $1,056 $77 $1,109 $1,181 $1,121 $4,848

2013 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2014 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2015 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2016 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2017 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2018 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2019 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2020 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2021 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2022 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2023 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2024 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2025 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2026 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2027 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2028 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2029 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2030 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2031 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2032 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2033 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2034 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2035 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2036 $116 $204 $1,112 $81 $1,109 $1,181 $1,121 $4,924

2037 $116 $204 $1,112 $81 $998 $1,063 $1,009 $4,583

2038 $105 $183 $1,001 $73 $887 $945 $897 $4,090

2039 $93 $163 $889 $65 $222 $236 $224 $1,892

2040 $23 $41 $222 $16 $111 $118 $112 $644

2041 $12 $20 $111 $8 $55 $59 $56 $322

2042 $6 $10 $56 $4 $0 $0 $0 $76

2043 $0 $0 $0 $0 $0 $0 $0 $0

2044 $0 $0 $0 $0 $0 $0 $0 $0

2045 $0 $0 $0 $0 $0 $0 $0 $0

2046 $0 $0 $0 $0 $0 $0 $0 $0

2047 $0 $0 $0 $0 $0 $0 $0 $0

2048 $0 $0 $0 $0 $0 $0 $0 $0

PV 3%b $2,143 $3,761 $20,519 $1,498 $21,088 $22,452 $21,306 $92,769

Annualized 3%c $109 $192 $1,047 $76 $1,076 $1,146 $1,087 $4,733

PV 7%b $1,258 $2,207 $12,042 $879 $12,857 $13,688 $12,990 $55,921

Annualized 7%c $101 $178 $970 $71 $1,036 $1,103 $1,047 $4,506 a

 Because EPA estimated non-use benefits only qualitatively, the total monetary value of I&E losses includes only losses in use

values. b The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. c Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Table E2-4: Time Profile of Mean Total Use Benefits - 50 MGD All Option (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico Great Lakes Inland National 

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $0e $7 $7

2011 $3 $0 $7 $0 $0 $11 $33 $54

2012 $7 $5 $14 $0 $76 $26 $96 $223

2013 $27 $10 $99 $0 $152 $106 $231 $625

2014 $31 $42 $164 $0 $608 $160 $275 $1,280

2015 $32 $50 $439 $0 $684 $291 $329 $1,826

2016 $34 $72 $571 $0 $722 $371 $349 $2,120

2017 $34 $78 $607 $0 $760 $391 $354 $2,225

2018 $34 $79 $636 $0 $760 $406 $358 $2,272

2019 $34 $81 $643 $0 $760 $410 $358 $2,286

2020 $34 $81 $643 $0 $760 $410 $358 $2,286

2021 $34 $81 $643 $0 $760 $410 $358 $2,286

2022 $34 $81 $643 $0 $760 $410 $358 $2,286

2023 $34 $81 $643 $0 $760 $410 $358 $2,286

2024 $34 $81 $643 $0 $760 $410 $358 $2,286

2025 $34 $81 $643 $0 $760 $410 $358 $2,286

2026 $34 $81 $643 $0 $760 $410 $358 $2,286

2027 $34 $81 $643 $0 $760 $410 $358 $2,286

2028 $34 $81 $643 $0 $760 $410 $358 $2,286

2029 $34 $81 $643 $0 $760 $410 $358 $2,286

2030 $34 $81 $643 $0 $760 $410 $358 $2,286

2031 $34 $81 $643 $0 $760 $410 $358 $2,286

2032 $34 $81 $643 $0 $760 $410 $358 $2,286

2033 $34 $81 $643 $0 $760 $410 $358 $2,286

2034 $34 $81 $643 $0 $760 $410 $358 $2,286

2035 $34 $81 $643 $0 $760 $410 $358 $2,286

2036 $34 $81 $643 $0 $760 $410 $358 $2,286

2037 $34 $81 $643 $0 $760 $410 $358 $2,286

2038 $34 $81 $643 $0 $760 $410 $358 $2,286

2039 $34 $81 $643 $0 $760 $410 $358 $2,286

2040 $34 $81 $643 $0 $760 $410 $351 $2,279

2041 $31 $81 $636 $0 $760 $400 $324 $2,232

2042 $27 $76 $629 $0 $684 $384 $262 $2,063

2043 $7 $71 $543 $0 $608 $304 $127 $1,661

2044 $3 $39 $479 $0 $152 $250 $83 $1,006

2045 $2 $31 $203 $0 $76 $120 $28 $460

2046 $0 $9 $71 $0 $38 $39 $8 $166

2047 $0 $3 $36 $0 $0 $19 $4 $61

2048 $0 $2 $7 $0 $0 $5 $0e $14

PV 3%c $577 $1,298 $10,239 $0 $12,463 $6,602 $5,998 $37,177

Annualized 3%d $29 $66 $522 $0 $636 $337 $306 $1,897

PV 7%c $302 $635 $4,973 $0 $6,280 $3,252 $3,113 $18,556

Annualized 7%d $24 $51 $401 $0 $506 $262 $251 $1,495 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 50 MGD and therefore would not be required to install technologies to comply with this option. c The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. e

 Positive non-zero value less than $500. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Table E2-5: Time Profile of Mean Total Use Benefits - 200 MGD All Option (thousands; 2003$)a

Year Californiab North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico Great Lakes Inland National 

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $0 $3 $3

2011 $0 $0 $0 $0 $0 $4 $23 $27

2012 $0 $0 $0 $0 $42 $8 $58 $108

2013 $0 $0 $43 $0 $83 $48 $168 $343

2014 $0 $2 $100 $0 $332 $77 $191 $702

2015 $0 $3 $372 $0 $374 $185 $225 $1,159

2016 $0 $14 $501 $0 $394 $251 $238 $1,398

2017 $0 $15 $537 $0 $415 $267 $240 $1,474

2018 $0 $16 $565 $0 $415 $279 $242 $1,518

2019 $0 $17 $572 $0 $415 $283 $242 $1,530

2020 $0 $17 $572 $0 $415 $283 $242 $1,530

2021 $0 $17 $572 $0 $415 $283 $242 $1,530

2022 $0 $17 $572 $0 $415 $283 $242 $1,530

2023 $0 $17 $572 $0 $415 $283 $242 $1,530

2024 $0 $17 $572 $0 $415 $283 $242 $1,530

2025 $0 $17 $572 $0 $415 $283 $242 $1,530

2026 $0 $17 $572 $0 $415 $283 $242 $1,530

2027 $0 $17 $572 $0 $415 $283 $242 $1,530

2028 $0 $17 $572 $0 $415 $283 $242 $1,530

2029 $0 $17 $572 $0 $415 $283 $242 $1,530

2030 $0 $17 $572 $0 $415 $283 $242 $1,530

2031 $0 $17 $572 $0 $415 $283 $242 $1,530

2032 $0 $17 $572 $0 $415 $283 $242 $1,530

2033 $0 $17 $572 $0 $415 $283 $242 $1,530

2034 $0 $17 $572 $0 $415 $283 $242 $1,530

2035 $0 $17 $572 $0 $415 $283 $242 $1,530

2036 $0 $17 $572 $0 $415 $283 $242 $1,530

2037 $0 $17 $572 $0 $415 $283 $242 $1,530

2038 $0 $17 $572 $0 $415 $283 $242 $1,530

2039 $0 $17 $572 $0 $415 $283 $242 $1,530

2040 $0 $17 $572 $0 $415 $283 $239 $1,527

2041 $0 $17 $572 $0 $415 $279 $219 $1,503

2042 $0 $17 $572 $0 $374 $275 $184 $1,422

2043 $0 $17 $529 $0 $332 $235 $74 $1,188

2044 $0 $15 $472 $0 $83 $207 $51 $828

2045 $0 $14 $200 $0 $42 $99 $17 $371

2046 $0 $3 $71 $0 $21 $32 $4 $132

2047 $0 $2 $36 $0 $0 $16 $2 $56

2048 $0 $1 $7 $0 $0 $4 $0 $12

PV 3%c $0 $266 $9,047 $0 $6,810 $4,513 $4,063 $24,698

Annualized 3%d $0 $14 $462 $0 $347 $230 $207 $1,260

PV 7%c $0 $124 $4,349 $0 $3,431 $2,192 $2,113 $12,209

Annualized 7%d $0 $10 $350 $0 $277 $177 $170 $984 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 200 MGD and therefore would not be required to install technologies to comply with this option. c

 The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Table E2-6: Time Profile of Mean Total Use Benefits - 100 MGD CWB Option (thousands; 2003$)a

Year Californiab North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico

Great

Lakes Inlandc NationalTotal

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $0 $0 $0

2011 $0 $0 $0 $0 $0 $6 $0 $6

2012 $0 $5 $0 $0 $76 $12 $0 $93

2013 $0 $10 $43 $0 $152 $66 $0 $270

2014 $0 $40 $100 $0 $608 $98 $0 $846

2015 $0 $47 $372 $0 $684 $212 $0 $1,316

2016 $0 $60 $501 $0 $722 $284 $0 $1,566

2017 $0 $64 $537 $0 $760 $301 $0 $1,661

2018 $0 $65 $565 $0 $760 $314 $0 $1,703

2019 $0 $66 $572 $0 $760 $318 $0 $1,716

2020 $0 $66 $572 $0 $760 $318 $0 $1,716

2021 $0 $66 $572 $0 $760 $318 $0 $1,716

2022 $0 $66 $572 $0 $760 $318 $0 $1,716

2023 $0 $66 $572 $0 $760 $318 $0 $1,716

2024 $0 $66 $572 $0 $760 $318 $0 $1,716

2025 $0 $66 $572 $0 $760 $318 $0 $1,716

2026 $0 $66 $572 $0 $760 $318 $0 $1,716

2027 $0 $66 $572 $0 $760 $318 $0 $1,716

2028 $0 $66 $572 $0 $760 $318 $0 $1,716

2029 $0 $66 $572 $0 $760 $318 $0 $1,716

2030 $0 $66 $572 $0 $760 $318 $0 $1,716

2031 $0 $66 $572 $0 $760 $318 $0 $1,716

2032 $0 $66 $572 $0 $760 $318 $0 $1,716

2033 $0 $66 $572 $0 $760 $318 $0 $1,716

2034 $0 $66 $572 $0 $760 $318 $0 $1,716

2035 $0 $66 $572 $0 $760 $318 $0 $1,716

2036 $0 $66 $572 $0 $760 $318 $0 $1,716

2037 $0 $66 $572 $0 $760 $318 $0 $1,716

2038 $0 $66 $572 $0 $760 $318 $0 $1,716

2039 $0 $66 $572 $0 $760 $318 $0 $1,716

2040 $0 $66 $572 $0 $760 $318 $0 $1,716

2041 $0 $66 $572 $0 $760 $312 $0 $1,710

2042 $0 $61 $572 $0 $684 $306 $0 $1,623

2043 $0 $56 $529 $0 $608 $252 $0 $1,445

2044 $0 $25 $472 $0 $152 $220 $0 $870

2045 $0 $19 $200 $0 $76 $105 $0 $400

2046 $0 $6 $71 $0 $38 $34 $0 $150

2047 $0 $2 $36 $0 $0 $17 $0 $55

2048 $0 $1 $7 $0 $0 $4 $0 $12

PV 3%d $0 $1,059 $9,047 $0 $12,463 $5,079 $0 $27,647

Annualized 3%e $0 $54 $462 $0 $636 $259 $0 $1,411

PV 7%d $0 $524 $4,349 $0 $6,280 $2,479 $0 $13,632

Annualized 7%e $0 $42 $350 $0 $506 $200 $0 $1,099 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 100 MGD and therefore would not be required to install technologies to comply with this option. c

 The 100 MGD CWB option would not apply national categorical requirements to facilities located on freshwater rivers and

lakes/reservoirs. Thus, no I&E reductions are expected at the potentially regulated facilities in the Inland region. d The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. e

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

1

 See Chapter A6 of the RBA for a detailed description of the ecological benefits from reduced I&E.

E2-10

E2-4 TOTAL ANNUALIZED MONETARY VALUE OF LOSSES AND BENEFITS

EPA used the profiles of benefits, by region, to calculate a total present value of benefits and then to calculate a

constant annual equivalent value (annualized value) of the present value. EPA performed the calculations of

present value and annualized value using two discount rate values: a real rate of 3% and a real rate of 7%. 

Although the total period for analysis of benefits extends from 2007 through 2048, a 42-year period, EPA

annualized the value of benefits over 30 years, which is the assumed length of each facility’s compliance period

for the social cost analysis, as described in Chapter E1: Summary of Social Costs. Using the same annualization

period as in the cost analysis is necessary to provide a conceptually and mathematically consistent comparison of

annualized benefit and cost values.

EPA estimated mean values, as well as lower and upper bound values reflecting uncertainty in the recreational

benefits estimates. Table E2-7 presents the value of baseline I&E losses for each region and for the nation as a

whole. Tables E2-8 and E2-9 present I&E losses for each region and the nation under the 50 MGD All, 200

MGD All, and 100 MGD CWB options discounted at 3% and 7%, respectively. Because EPA did not estimate

non-use benefits quantitatively, the monetary value of national losses and benefits presented in these tables

reflects only use values.1

 As described in Chapter A3 of the RBA, the Agency was not able to monetize benefits

for 96.7% of the age-one equivalent losses of all commercial, recreational, and forage species analyzed for the

evaluated options for existing facilities. This means that the estimates of losses and benefits presented in this

section represent the losses and benefits associated with less than 3.3% of the total age-one equivalents lost due to

I&E by cooling water intake structures, and should be interpreted with caution.

Table E2-7 reports the monetized value of baseline losses as outlined above. EPA estimates the national value of

these losses at $0.3 million in commercial fishing losses and $4.4 million in recreational fishing losses (2003$,

discounted to 2007 at 3%). The total use value of fishery resources lost is $4.7 million per year, with lower and

upper bounds of $2.4 million and $9.5 million, respectively (2003$, discounted at 3%). At a 7% discount rate,

EPA estimates total annual national value of losses at $0.3 million in commercial fishing losses and $4.2 million

in recreational fishing losses (2003$). The total use value of fishery resources lost, discounted at 7%, is $4.5

million per year, with lower and upper bounds of $2.3 million and $9.0 million, respectively (2003$). Total

monetized losses are greatest in the Great Lakes region. More detailed discussions of the valuation of recreational

and commercial fishing losses under the baseline conditions in each region are provided in Parts B through G of

the RBA.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

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Table E2-7: Summary of Monetary Values of Baseline I&E Losses (thousands; 2003$)a

Region

Annualized Use Value of Baseline I&E Losses

Commercial

Fishing

Recreational Fishing Total Use Valueb

Low Mean High Low Mean High

3% discount rate

California $0 - $20 $38 $90 $211 $58 $109 $231

North Atlantic $0 - $9 $84 $183 $401 $93 $192 $409

Mid-Atlantic $0 - $47 $473 $1,000 $2,124 $520 $1,047 $2,171

South Atlantic $0 $34 $76 $171 $34 $76 $171

Gulf of Mexico $0 - $139 $419 $937 $2,105 $558 $1,076 $2,244

Great Lakes $0 - $70 $534 $1,076 $2,109 $604 $1,146 $2,179

Inlandc n/a $576 $1,087 $2,047 $576 $1,087 $2,047

National Total $0 - $284 $2,159 $4,449 $9,168 $2,443 $4,733 $9,452

7% discount rate

California $0 - $18 $35 $83 $196 $54 $101 $214

North Atlantic $0 - $8 $78 $170 $371 $86 $178 $379

Mid-Atlantic $0 - $44 $438 $927 $1,969 $482 $970 $2,012

South Atlantic $0 $32 $71 $158 $32 $71 $158

Gulf of Mexico $0 - $133 $404 $903 $2,028 $537 $1,036 $2,161

Great Lakes $0 - $67 $515 $1,036 $2,031 $582 $1,103 $2,099

Inlandc n/a $555 $1,047 $1,971 $555 $1,047 $1,971

National Total $0 - $271 $2,057 $4,236 $8,724 $2,328 $4,506 $8,995

a All losses presented in this table are annualized. These estimated annualized losses represent the value of all losses generated over

the time frame of the analysis, discounted to 2007, and then annualized over a 30-year period. b

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. A

range of recreational fishing benefits is provided, based on the Krinsky and Robb technique to estimated the 95th and 5th percentile

limits on the marginal value per fish predicted by EPA’s meta-analysis (see chapter A5 of the RBA). Commercial fishing benefits

are computed based on a range from 0% to 40% of the change in gross revenue (see Chapter A4 of the RBA). To calculate the total

use value columns (low, mean, and high), the high end value for commercial fishing benefits is added to the low, mean, and high

values for recreational fishing benefits, respectively. c

 No significant commercial fishing takes place in the Inland region. Thus, this region is excluded from the commercial fishing

analysis.

Source: U.S. EPA Analysis, 2004.

Tables E2-8 and E2-9 present EPA’s estimates of the national and regional values of avoided I&E losses (all

values are in 2003$, discounted at 3% and 7% to beginning of year 2007, and annualized over a 30-year period). 

National values of avoided I&E losses at a 3% discount rate are as follows:

< For the 50 MGD All option, a mean value of $1.9 million per year, with lower and upper bounds of $1.0

million and $3.8 million (see Table E2-8);

< For the 200 MGD All option, a mean value of $1.3 million per year, with lower and upper bounds of $0.6

million and $2.5 million (see Table E2-8); and

< For the 100 MGD CWB option, a mean value of $1.4 million per year, with lower and upper bounds of

$0.7 million and $2.9 million (see Table E2-8).
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-12

The 7% discount rate calculations yield smaller values as follows:

< For the 50 MGD All option, a mean value of $1.5 million per year, with lower and upper bounds of $0.8

million and $3.0 million (see Table E2-9);

< For the 200 MGD All option, a mean value of $1.0 million per year, with lower and upper bounds of $0.5

million and $2.0 million (see Table E2-9); and

< For the 100 MGD CWB option, a mean value of $1.1 million per year, with lower and upper bounds of

$0.6 million and $2.3 million (see Table E2-9).

EPA also considered how benefits might increase if facilities that meet technology requirements in the baseline

optimize their operation and maintenance (O&M) procedures (e.g., by rotating screens more often to reduce

impingement mortality due to the proposed regulation). For this analysis, EPA evaluated facilities that are

expected to (1) install no new technology and (2) meet impingement standards with a 0.5 fps screen. If there was

a 5% increase in the efficacy of O&M at these facilities, the total annualized national benefits from the proposed

regulation would increase by approximately $19,000 for the 50 MGD All option, from $1.897 million to $1.916

million (using the 3% discount rate). If there was a 15% increase in efficacy, the estimated annualized benefits

would increase by over $58,000, to $1.955 million (using the 3% discount rate). Using the 7% discount rate, total

annualized national benefits from the proposed regulation would increase by approximately $18,000 and $55,000,

for the 5% and 15% increases in efficacy, respectively. Therefore, optimization of O&M procedures would result

in 1.0% to 3.5% increase in the estimated total use benefits of the proposed regulation, depending on the assumed

increase in efficacy and the discount rate being used. Optimization of O&M procedures would result in similar

increases in the estimated use benefits under “200 MGD for All Waterbodies” and “100 MGD for Certain

Waterbodies” options.

The majority of the use benefit value is attributable to benefits to recreational anglers from improved catch rates. 

As shown in Tables E2-8 and E2-9, use benefits are largest in the Gulf of Mexico for the 50 MGD All and 100

MGD CWB options and the Mid-Atlantic region under the 200 MGD All option. More detailed discussions of

regional benefits under each option are provided in Parts B through G of the RBA.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-13

Table E2-8: Summary of Monetized Benefits by Option (thousands; 2003$; discounted at 3%)a

Region

Annualized

Commercial

Fishing Benefits

Annualized Recreational Fishing

Benefits

Total Annualized Value of Monetized

Impingement and Entrainment

Reductionsb

Low Mean High Low Mean High

50 MGD All Option

California $0 - $5 $10 $24 $57 $16 $29 $62

North Atlantic $0 - $3 $29 $63 $138 $32 $66 $141

Mid-Atlantic $0 - $25 $235 $497 $1,057 $260 $522 $1,082

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $78 $249 $558 $1,254 $327 $636 $1,332

Great Lakes $0 - $20 $157 $316 $621 $178 $337 $641

Inlandd n/a $162 $306 $577 $162 $306 $577

National Total $0 - $132 $843 $1,765 $3,704 $975 $1,897 $3,836

200 MGD All Option

Californiae $0 $0 $0 $0 $0 $0 $0

North Atlantic $0 - $1 $6 $13 $28 $7 $14 $29

Mid-Atlantic $0 - $22 $208 $440 $934 $230 $462 $956

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $43 $136 $305 $685 $179 $347 $728

Great Lakes $0 - $14 $108 $216 $425 $122 $230 $439

Inlandd n/a $110 $207 $390 $110 $207 $390

National Total $0 - $79 $567 $1,181 $2,463 $647 $1,260 $2,542

100 MGD CWB Option

Californiae $0 $0 $0 $0 $0 $0 $0

North Atlantic $0 - $2 $24 $52 $113 $26 $54 $115

Mid-Atlantic $0 - $22 $208 $440 $934 $230 $462 $956

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $78 $249 $558 $1,254 $327 $636 $1,332

Great Lakes $0 - $16 $121 $243 $478 $137 $259 $494

Inlandd,f n/a $0 $0 $0 $0 $0 $0

National Total $0 - $118 $602 $1,292 $2,779 $720 $1,411 $2,897

a

 All benefits presented in this table are annualized. These annualized benefits represent the value of all losses generated over the

time frame of the analysis, discounted to 2007, and then annualized over a 30-year period. b

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. A

range of recreational fishing benefits is provided, based on the Krinsky and Robb technique to estimated the 95th and 5th

percentile limits on the marginal value per fish predicted by EPA’s meta-analysis (see chapter A5 of the RBA). Commercial

fishing benefits are computed based on a range from 0% to 40% of the change in gross revenue (see Chapter A4 of the RBA). To

calculate the total use value columns (low, mean, and high), the high end value for commercial fishing benefits is added to the low,

mean, and high values for recreational fishing benefits, respectively. c

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 50 MGD and therefore would not be required to install technologies to comply with the proposed options. d No significant commercial fishing takes place in the Inland region. Thus, this region is excluded from the commercial fishing

analysis. e

 No I&E reductions are expected in the California region because all potentially regulated facilities in this region withdraw less

than 100 MGD and therefore would not be required to install technologies to comply with the 200 MGD All and the 100 MGD

CWB options. f

 The 100 MGD CWB option would not apply national categorical requirements to facilities located on freshwater rivers and

lakes/reservoirs. Thus, no I&E reductions are expected at the potentially regulated facilities in the Inland region.

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-14

Table E2-9: Summary of Monetized Benefits by Option (thousands; 2003$; discounted at 7%)a

Region

Annualized

Commercial

Fishing Benefits

Annualized Recreational Fishing

Benefits

Total Annualized Value of Monetized

Impingement and Entrainment

Reductionsb

Low Mean High Low Mean High

50 MGD All Option

California $0 - $4 $9 $20 $47 $13 $24 $51

North Atlantic $0 - $2 $22 $49 $107 $25 $51 $109

Mid-Atlantic $0 - $19 $181 $382 $811 $200 $401 $830

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $62 $198 $444 $998 $260 $506 $1,061

Great Lakes $0 - $16 $122 $246 $483 $138 $262 $499

Inlandd n/a $133 $251 $473 $133 $251 $473

National Total $0 - $104 $665 $1,391 $2,919 $769 $1,495 $3,023

200 MGD All Option

Californiae $0 $0 $0 $0 $0 $0 $0

North Atlantic $0 $4 $10 $21 $5 $10 $21

Mid-Atlantic $0 - $17 $158 $334 $709 $175 $350 $726

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $34 $108 $243 $545 $142 $277 $579

Great Lakes $0 - $11 $83 $166 $326 $93 $177 $337

Inlandd n/a $90 $170 $321 $90 $170 $321

National Total $0 - $62 $443 $922 $1,922 $505 $984 $1,984

100 MGD CWB Option

Californiae $0 $0 $0 $0 $0 $0 $0

North Atlantic $0 - $2 $19 $40 $88 $20 $42 $90

Mid-Atlantic $0 - $17 $158 $334 $709 $175 $350 $726

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $62 $198 $444 $998 $260 $506 $1,061

Great Lakes $0 - $12 $93 $188 $368 $105 $200 $381

Inlandd,f n/a $0 $0 $0 $0 $0 $0

National Total $0 - $93 $468 $1,006 $2,164 $561 $1,099 $2,257

a

 All benefits presented in this table are annualized. These annualized benefits represent the value of all losses generated over the

time frame of the analysis, discounted to 2007, and then annualized over a 30-year period. b

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. A

range of recreational fishing benefits is provided, based on the Krinsky and Robb technique to estimated the 95th and 5th

percentile limits on the marginal value per fish predicted by EPA’s meta-analysis (see chapter A5 of the RBA). Commercial

fishing benefits are computed based on a range from 0% to 40% of the change in gross revenue (see Chapter A4 of the RBA). To

calculate the total use value columns (low, mean, and high), the high end value for commercial fishing benefits is added to the low,

mean, and high values for recreational fishing benefits, respectively. c

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 50 MGD and therefore would not be required to install technologies to comply with the proposed options. d No significant commercial fishing takes place in the Inland region, and thus this region is excluded from the commercial fishing

benefits analysis. e

 No I&E reductions are expected in the California region because all potentially regulated facilities in this region withdraw less

than 100 MGD and therefore would not be required to install technologies to comply with the 200 MGD All and the 100 MGD

CWB options. f

 The 100 MGD CWB option would not apply national categorical requirements to facilities located on freshwater rivers and

lakes/reservoirs. Thus, no I&E reductions are expected at the potentially regulated facilities in the Inland region.

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-15

REFERENCES

U.S. Environmental Protection Agency (U.S. EPA). 2004. The Regional Benefits Assessment for the Proposed

Section 316(b) Rule for Phase III Facilities. EPA-821-R-04-017. November 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E2: Summary of Benefits

E2-16

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Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-1

Appendix to Chapter E2

INTRODUCTION

This appendix supplements Chapter E2 by presenting

the results of the benefits analysis for five other

options evaluated for potential Phase III existing

facilities. For all options, facility counts and other

results only include those potential Phase III existing

facilities that are (1) non-baseline closures and (2)

subject to national categorical requirements under the option. The options are presented in increasing order based

on design intake flow (DIF) applicability threshold and the stringency of compliance requirements. See the main

body of this chapter for a description of methodologies used in this analysis.

E2A-1 SUMMARY OF EXPECTED REDUCTIONS IN I&E

Table E2A-1 presents the number of facilities with technology requirements under the other options, by region,

and EPA’s estimates of the percentage by which I&E would be reduced. The table also presents estimates of

regional and national reductions in I&E losses under each option, expressed as age-one equivalents lost and

foregone fishery yield.

Table E2A-1: Expected Reductions in I&E for Existing Phase III Facilities by Option 

Region

Number of

Facilities Installing

Technology Impingement Entrainment

Age-One

Equivalents

(thousands)

Foregone

Fishery Yield

(thousands; lbs)

Option 3

California 4 78% 29% 391 28

North Atlantic 4 43% 40% 930 18

Mid-Atlantic 4 74% 55% 13,400 606

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 11 80% 57% 8,650 1,270

Great Lakes 38 38% 43% 13,200 190

Inland 130 43% 27% 16,600 171

National Total 190 53,171 2,283

Option 4

California 4 78% 59% 771 56

North Atlantic 4 43% 40% 930 18

Mid-Atlantic 4 74% 55% 13,600 610

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 11 80% 60% 8,860 1,320

Great Lakes 38 38% 46% 13,300 192

Inland 69 37% 27% 14,800 157

National Total 130 52,261 2,353

Option 2

APPENDIX CONTENTS

E2A-1 Summary of Expected Reductions in I&E . E2A-1

E2A-2 Time Profile of Benefits . . . . . . . . . . . . . . . E2A-3

E2A-3 Total Annualized Monetary Value

of Benefits . . . . . . . . . . . . . . . . . . . . . . . . . E2A-9
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

Table E2A-1: Expected Reductions in I&E for Existing Phase III Facilities by Option 

Region

Number of

Facilities Installing

Technology Impingement Entrainment

Age-One

Equivalents

(thousands)

Foregone

Fishery Yield

(thousands; lbs)

E2A-2

California 4 78% 59% 771 56

North Atlantic 4 43% 40% 930 18

Mid-Atlantic 4 74% 55% 13,600 610

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 11 80% 60% 8,860 1,320

Great Lakes 38 38% 46% 13,300 192

Inland 69 37% 27% 14,800 157

National Total 130 52,261 2,353

Option 1

California 4 78% 59% 771 56

North Atlantic 4 43% 40% 930 18

Mid-Atlantic 4 74% 55% 13,600 610

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 11 80% 60% 8,860 1,320

Great Lakes 38 38% 46% 13,300 192

Inland 134 43% 29% 16,900 177

National Total 194 54,361 2,373

Option 6

California 4 78% 59% 771 56

North Atlantic 4 43% 40% 930 18

Mid-Atlantic 5 75% 56% 13,700 615

South Atlantica 0 0% 0% 0 0

Gulf of Mexico 11 80% 60% 8,860 1,320

Great Lakes 61 41% 48% 14,300 206

Inland 203 45% 30% 17,600 183

National Total 288 56,161 2,398

a No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with

these options.

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-3

E2A-2 TIME PROFILE OF BENEFITS

Tables E2A-2 through E2A-6 below provide the time profiles of regional benefits for Option 3, Option 4, Option

2, Option 1, and Option 6.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-4

Table E2A-2: Time Profile of Mean Total Use Benefits - Option 3 (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico

Great

Lakes Inland National

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $0e $7 $8

2011 $2 $0 $7 $0 $0 $12 $34 $55

2012 $4 $5 $15 $0 $79 $31 $101 $234

2013 $14 $10 $100 $0 $158 $121 $238 $641

2014 $18 $42 $170 $0 $631 $193 $292 $1,346

2015 $20 $50 $443 $0 $710 $331 $354 $1,909

2016 $32 $72 $574 $0 $750 $418 $380 $2,226

2017 $34 $78 $610 $0 $789 $440 $387 $2,338

2018 $35 $79 $638 $0 $789 $455 $391 $2,387

2019 $36 $81 $645 $0 $789 $460 $391 $2,403

2020 $36 $81 $645 $0 $789 $460 $391 $2,403

2021 $36 $81 $645 $0 $789 $460 $391 $2,403

2022 $36 $81 $645 $0 $789 $460 $391 $2,403

2023 $36 $81 $645 $0 $789 $460 $391 $2,403

2024 $36 $81 $645 $0 $789 $460 $391 $2,403

2025 $36 $81 $645 $0 $789 $460 $391 $2,403

2026 $36 $81 $645 $0 $789 $460 $391 $2,403

2027 $36 $81 $645 $0 $789 $460 $391 $2,403

2028 $36 $81 $645 $0 $789 $460 $391 $2,403

2029 $36 $81 $645 $0 $789 $460 $391 $2,403

2030 $36 $81 $645 $0 $789 $460 $391 $2,403

2031 $36 $81 $645 $0 $789 $460 $391 $2,403

2032 $36 $81 $645 $0 $789 $460 $391 $2,403

2033 $36 $81 $645 $0 $789 $460 $391 $2,403

2034 $36 $81 $645 $0 $789 $460 $391 $2,403

2035 $36 $81 $645 $0 $789 $460 $391 $2,403

2036 $36 $81 $645 $0 $789 $460 $391 $2,403

2037 $36 $81 $645 $0 $789 $460 $391 $2,403

2038 $36 $81 $645 $0 $789 $460 $391 $2,403

2039 $36 $81 $645 $0 $789 $460 $391 $2,403

2040 $36 $81 $645 $0 $789 $460 $384 $2,395

2041 $34 $81 $638 $0 $789 $448 $357 $2,348

2042 $32 $76 $630 $0 $710 $429 $291 $2,169

2043 $21 $71 $545 $0 $631 $339 $153 $1,762

2044 $18 $39 $475 $0 $158 $267 $99 $1,057

2045 $15 $31 $202 $0 $79 $129 $37 $493

2046 $4 $9 $71 $0 $39 $42 $11 $176

2047 $2 $3 $35 $0 $0 $20 $5 $65

2048 $1 $2 $7 $0 $0 $5 $1 $15

PV 3%c $574 $1,298 $10,281 $0 $12,945 $7,416 $6,542 $39,056

Annualized 3%d $29 $66 $525 $0 $660 $378 $334 $1,993

PV 7%c $285 $635 $4,996 $0 $6,523 $3,661 $3,384 $19,484

Annualized 7%d $23 $51 $403 $0 $526 $295 $273 $1,570 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. c

 The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. e

 Positive non-zero value less than $500. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

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Table E2A-3: Time Profile of Mean Total Use Benefits - Option 4 (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico

Great

Lakes Inland National

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $1 $7 $7

2011 $3 $0 $7 $0 $0 $12 $33 $56

2012 $7 $5 $15 $0 $80 $31 $96 $234

2013 $27 $10 $101 $0 $161 $122 $231 $652

2014 $34 $42 $172 $0 $642 $195 $275 $1,360

2015 $39 $50 $449 $0 $723 $334 $329 $1,924

2016 $62 $72 $581 $0 $763 $422 $349 $2,250

2017 $65 $78 $617 $0 $803 $445 $354 $2,362

2018 $67 $79 $646 $0 $803 $460 $358 $2,413

2019 $69 $81 $653 $0 $803 $465 $358 $2,428

2020 $69 $81 $653 $0 $803 $465 $358 $2,428

2021 $69 $81 $653 $0 $803 $465 $358 $2,428

2022 $69 $81 $653 $0 $803 $465 $358 $2,428

2023 $69 $81 $653 $0 $803 $465 $358 $2,428

2024 $69 $81 $653 $0 $803 $465 $358 $2,428

2025 $69 $81 $653 $0 $803 $465 $358 $2,428

2026 $69 $81 $653 $0 $803 $465 $358 $2,428

2027 $69 $81 $653 $0 $803 $465 $358 $2,428

2028 $69 $81 $653 $0 $803 $465 $358 $2,428

2029 $69 $81 $653 $0 $803 $465 $358 $2,428

2030 $69 $81 $653 $0 $803 $465 $358 $2,428

2031 $69 $81 $653 $0 $803 $465 $358 $2,428

2032 $69 $81 $653 $0 $803 $465 $358 $2,428

2033 $69 $81 $653 $0 $803 $465 $358 $2,428

2034 $69 $81 $653 $0 $803 $465 $358 $2,428

2035 $69 $81 $653 $0 $803 $465 $358 $2,428

2036 $69 $81 $653 $0 $803 $465 $358 $2,428

2037 $69 $81 $653 $0 $803 $465 $358 $2,428

2038 $69 $81 $653 $0 $803 $465 $358 $2,428

2039 $69 $81 $653 $0 $803 $465 $358 $2,428

2040 $69 $81 $653 $0 $803 $464 $351 $2,421

2041 $65 $81 $646 $0 $803 $453 $324 $2,373

2042 $62 $76 $638 $0 $723 $434 $262 $2,195

2043 $41 $71 $552 $0 $642 $343 $127 $1,776

2044 $35 $39 $481 $0 $161 $270 $83 $1,068

2045 $29 $31 $205 $0 $80 $131 $28 $504

2046 $7 $9 $72 $0 $40 $42 $8 $179

2047 $3 $3 $36 $0 $0 $20 $4 $66

2048 $2 $2 $7 $0 $0 $5 $0e $16

PV 3%c $1,112 $1,298 $10,407 $0 $13,167 $7,494 $5,998 $39,475

Annualized 3%d $57 $66 $531 $0 $672 $382 $306 $2,014

PV 7%c $552 $635 $5,057 $0 $6,635 $3,699 $3,113 $19,692

Annualized 7%d $44 $51 $408 $0 $535 $298 $251 $1,587 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. c

 The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. e

 Positive non-zero value less than $500. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-6

Table E2A-4: Time Profile of Mean Total Use Benefits - Option 2 (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico Great Lakes Inland National

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $1 $7 $7

2011 $3 $0 $7 $0 $0 $12 $33 $56

2012 $7 $5 $15 $0 $80 $31 $96 $234

2013 $27 $10 $101 $0 $161 $122 $231 $652

2014 $34 $42 $172 $0 $642 $195 $275 $1,360

2015 $39 $50 $449 $0 $723 $334 $329 $1,924

2016 $62 $72 $581 $0 $763 $422 $349 $2,250

2017 $65 $78 $617 $0 $803 $445 $354 $2,362

2018 $67 $79 $646 $0 $803 $460 $358 $2,413

2019 $69 $81 $653 $0 $803 $465 $358 $2,428

2020 $69 $81 $653 $0 $803 $465 $358 $2,428

2021 $69 $81 $653 $0 $803 $465 $358 $2,428

2022 $69 $81 $653 $0 $803 $465 $358 $2,428

2023 $69 $81 $653 $0 $803 $465 $358 $2,428

2024 $69 $81 $653 $0 $803 $465 $358 $2,428

2025 $69 $81 $653 $0 $803 $465 $358 $2,428

2026 $69 $81 $653 $0 $803 $465 $358 $2,428

2027 $69 $81 $653 $0 $803 $465 $358 $2,428

2028 $69 $81 $653 $0 $803 $465 $358 $2,428

2029 $69 $81 $653 $0 $803 $465 $358 $2,428

2030 $69 $81 $653 $0 $803 $465 $358 $2,428

2031 $69 $81 $653 $0 $803 $465 $358 $2,428

2032 $69 $81 $653 $0 $803 $465 $358 $2,428

2033 $69 $81 $653 $0 $803 $465 $358 $2,428

2034 $69 $81 $653 $0 $803 $465 $358 $2,428

2035 $69 $81 $653 $0 $803 $465 $358 $2,428

2036 $69 $81 $653 $0 $803 $465 $358 $2,428

2037 $69 $81 $653 $0 $803 $465 $358 $2,428

2038 $69 $81 $653 $0 $803 $465 $358 $2,428

2039 $69 $81 $653 $0 $803 $465 $358 $2,428

2040 $69 $81 $653 $0 $803 $464 $351 $2,421

2041 $65 $81 $646 $0 $803 $453 $324 $2,373

2042 $62 $76 $638 $0 $723 $434 $262 $2,195

2043 $41 $71 $552 $0 $642 $343 $127 $1,776

2044 $35 $39 $481 $0 $161 $270 $83 $1,068

2045 $29 $31 $205 $0 $80 $131 $28 $504

2046 $7 $9 $72 $0 $40 $42 $8 $179

2047 $3 $3 $36 $0 $0 $20 $4 $66

2048 $2 $2 $7 $0 $0 $5 $0e $16

PV 3%c $1,112 $1,298 $10,407 $0 $13,167 $7,494 $5,998 $39,475

Annualized 3%d $57 $66 $531 $0 $672 $382 $306 $2,014

PV 7%c $552 $635 $5,057 $0 $6,635 $3,699 $3,113 $19,692

Annualized 7%d $44 $51 $408 $0 $535 $298 $251 $1,587 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. c

 The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period. e

 Positive non-zero value less than $500. 

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-7

Table E2A-5: Time Profile of Mean Total Use Benefits - Option 1 (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico

Great

Lakes Inland National

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $1 $7 $8

2011 $3 $0 $7 $0 $0 $12 $35 $57

2012 $7 $5 $15 $0 $80 $31 $104 $242

2013 $27 $10 $101 $0 $161 $122 $245 $666

2014 $34 $42 $172 $0 $642 $195 $302 $1,387

2015 $39 $50 $449 $0 $723 $334 $366 $1,961

2016 $62 $72 $581 $0 $763 $422 $392 $2,292

2017 $65 $78 $617 $0 $803 $445 $399 $2,407

2018 $67 $79 $646 $0 $803 $460 $403 $2,458

2019 $69 $81 $653 $0 $803 $465 $404 $2,474

2020 $69 $81 $653 $0 $803 $465 $404 $2,474

2021 $69 $81 $653 $0 $803 $465 $404 $2,474

2022 $69 $81 $653 $0 $803 $465 $404 $2,474

2023 $69 $81 $653 $0 $803 $465 $404 $2,474

2024 $69 $81 $653 $0 $803 $465 $404 $2,474

2025 $69 $81 $653 $0 $803 $465 $404 $2,474

2026 $69 $81 $653 $0 $803 $465 $404 $2,474

2027 $69 $81 $653 $0 $803 $465 $404 $2,474

2028 $69 $81 $653 $0 $803 $465 $404 $2,474

2029 $69 $81 $653 $0 $803 $465 $404 $2,474

2030 $69 $81 $653 $0 $803 $465 $404 $2,474

2031 $69 $81 $653 $0 $803 $465 $404 $2,474

2032 $69 $81 $653 $0 $803 $465 $404 $2,474

2033 $69 $81 $653 $0 $803 $465 $404 $2,474

2034 $69 $81 $653 $0 $803 $465 $404 $2,474

2035 $69 $81 $653 $0 $803 $465 $404 $2,474

2036 $69 $81 $653 $0 $803 $465 $404 $2,474

2037 $69 $81 $653 $0 $803 $465 $404 $2,474

2038 $69 $81 $653 $0 $803 $465 $404 $2,474

2039 $69 $81 $653 $0 $803 $465 $404 $2,474

2040 $69 $81 $653 $0 $803 $464 $396 $2,467

2041 $65 $81 $646 $0 $803 $453 $369 $2,417

2042 $62 $76 $638 $0 $723 $434 $300 $2,232

2043 $41 $71 $552 $0 $642 $343 $159 $1,809

2044 $35 $39 $481 $0 $161 $270 $102 $1,087

2045 $29 $31 $205 $0 $80 $131 $38 $514

2046 $7 $9 $72 $0 $40 $42 $12 $182

2047 $3 $3 $36 $0 $0 $20 $5 $67

2048 $2 $2 $7 $0 $0 $5 $1 $16

PV 3%c $1,112 $1,298 $10,407 $0 $13,167 $7,494 $6,748 $40,225

Annualized 3%d $57 $66 $531 $0 $672 $382 $344 $2,052

PV 7%c $552 $635 $5,057 $0 $6,635 $3,699 $3,490 $20,068

Annualized 7%d $44 $51 $408 $0 $535 $298 $281 $1,617 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. c

 The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period.

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-8

Table E2A-6: Time Profile of Mean Total Use Benefits - Option 6 (thousands; 2003$)a

Year California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico

Great

Lakes Inland National

Total

2007 $0 $0 $0 $0 $0 $0 $0 $0

2008 $0 $0 $0 $0 $0 $0 $0 $0

2009 $0 $0 $0 $0 $0 $0 $0 $0

2010 $0 $0 $0 $0 $0 $1 $8 $9

2011 $3 $0 $7 $0 $0 $15 $36 $61

2012 $7 $5 $15 $0 $80 $41 $106 $254

2013 $27 $10 $101 $0 $161 $140 $251 $690

2014 $34 $42 $172 $0 $642 $216 $311 $1,418

2015 $39 $50 $449 $0 $723 $361 $377 $1,999

2016 $62 $72 $582 $0 $763 $455 $406 $2,340

2017 $65 $78 $622 $0 $803 $478 $413 $2,460

2018 $67 $79 $651 $0 $803 $494 $418 $2,512

2019 $69 $81 $659 $0 $803 $499 $419 $2,529

2020 $69 $81 $659 $0 $803 $499 $419 $2,529

2021 $69 $81 $659 $0 $803 $499 $419 $2,529

2022 $69 $81 $659 $0 $803 $499 $419 $2,529

2023 $69 $81 $659 $0 $803 $499 $419 $2,529

2024 $69 $81 $659 $0 $803 $499 $419 $2,529

2025 $69 $81 $659 $0 $803 $499 $419 $2,529

2026 $69 $81 $659 $0 $803 $499 $419 $2,529

2027 $69 $81 $659 $0 $803 $499 $419 $2,529

2028 $69 $81 $659 $0 $803 $499 $419 $2,529

2029 $69 $81 $659 $0 $803 $499 $419 $2,529

2030 $69 $81 $659 $0 $803 $499 $419 $2,529

2031 $69 $81 $659 $0 $803 $499 $419 $2,529

2032 $69 $81 $659 $0 $803 $499 $419 $2,529

2033 $69 $81 $659 $0 $803 $499 $419 $2,529

2034 $69 $81 $659 $0 $803 $499 $419 $2,529

2035 $69 $81 $659 $0 $803 $499 $419 $2,529

2036 $69 $81 $659 $0 $803 $499 $419 $2,529

2037 $69 $81 $659 $0 $803 $499 $419 $2,529

2038 $69 $81 $659 $0 $803 $499 $419 $2,529

2039 $69 $81 $659 $0 $803 $499 $419 $2,529

2040 $69 $81 $659 $0 $803 $498 $411 $2,520

2041 $65 $81 $652 $0 $803 $484 $383 $2,468

2042 $62 $76 $644 $0 $723 $458 $312 $2,275

2043 $41 $71 $557 $0 $642 $359 $168 $1,839

2044 $35 $39 $487 $0 $161 $283 $107 $1,112

2045 $29 $31 $210 $0 $80 $138 $41 $530

2046 $7 $9 $77 $0 $40 $45 $13 $190

2047 $3 $3 $37 $0 $0 $21 $5 $70

2048 $2 $2 $8 $0 $0 $5 $1 $17

PV 3%c $1,112 $1,298 $10,492 $0 $13,167 $8,063 $6,993 $41,124

Annualized 3%d $57 $66 $535 $0 $672 $411 $357 $2,098

PV 7%c $552 $635 $5,095 $0 $6,635 $3,990 $3,614 $20,521

Annualized 7%d $44 $51 $411 $0 $535 $322 $291 $1,654 a

 Because EPA estimated non-use benefits only qualitatively, the monetary value of benefits includes use values only. b No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. c

 The present value (PV) is estimated by discounting individual annual values to 2007, using the stated discount rate. d

 Annualized benefits represent the value of all benefits generated over the time frame of the analysis, discounted to 2007, and then

annualized over a 30-year period.

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-9

E2A-3 TOTAL ANNUALIZED MONETARY VALUE OF BENEFITS

Tables E2A-7 and E2A-8 present EPA’s estimates of the value of national and regional reductions in I&E under

the other options analyzed for the proposed rule, using 3% and 7% discount rates. The tables shows for all other

options, that benefits to recreational anglers account for the majority of use benefits. National use benefits are

largest in the Gulf of Mexico region under all five options. More detailed discussions of regional benefits under

each option are provided in Sections B through G of the RBA.

Table E2A-7: Summary of Monetized Benefits for Existing Phase III Facilitiesa

(thousands; 2003$; discounted at 3%)

Region

Annualized Use Benefits of I&E Reductions

Annualized

Commercial

Fishing

Recreational Fishing Total Use Valueb

Low Mean High Low Mean High

Option 3

California $0 - $5 $10 $24 $57 $15 $29 $62

North Atlantic $0 - $3 $29 $63 $138 $32 $66 $141

Mid-Atlantic $0 - $25 $236 $499 $1,061 $261 $525 $1,086

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $80 $259 $580 $1,305 $339 $660 $1,385

Great Lakes $0 - $23 $177 $355 $697 $200 $378 $720

Inlandd n/a $176 $334 $630 $176 $334 $630

National Total $0 - $137 $888 $1,856 $3,888 $1,024 $1,993 $4,025

Option 4

California $0 - $10 $20 $47 $110 $30 $57 $120

North Atlantic $0 - $3 $29 $63 $138 $32 $66 $141

Mid-Atlantic $0 - $25 $239 $506 $1,074 $265 $531 $1,100

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $83 $263 $589 $1,325 $346 $672 $1,408

Great Lakes $0 - $23 $178 $359 $704 $202 $382 $728

Inlandd n/a $162 $306 $577 $162 $306 $577

National Total $0 - $144 $892 $1,870 $3,929 $1,036 $2,014 $4,073

Option 2

California $0 - $10 $20 $47 $110 $30 $57 $120

North Atlantic $0 - $3 $29 $63 $138 $32 $66 $141

Mid-Atlantic $0 - $25 $239 $506 $1,074 $265 $531 $1,100

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $83 $263 $589 $1,325 $346 $672 $1,408

Great Lakes $0 - $23 $178 $359 $704 $202 $382 $728

Inlandd n/a $162 $306 $577 $162 $306 $577

National Total $0 - $144 $892 $1,870 $3,929 $1,036 $2,014 $4,073
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

Table E2A-7: Summary of Monetized Benefits for Existing Phase III Facilitiesa

(thousands; 2003$; discounted at 3%)

Region

Annualized Use Benefits of I&E Reductions

Annualized

Commercial

Fishing

Recreational Fishing Total Use Valueb

Low Mean High Low Mean High

E2A-10

Option 1

California $0 - $10 $20 $47 $110 $30 $57 $120

North Atlantic $0 - $3 $29 $63 $138 $32 $66 $141

Mid-Atlantic $0 - $25 $239 $506 $1,074 $265 $531 $1,100

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $83 $263 $589 $1,325 $346 $672 $1,408

Great Lakes $0 - $23 $178 $359 $704 $202 $382 $728

Inlandd n/a $182 $344 $649 $182 $344 $649

National Total $0 - $144 $912 $1,908 $4,001 $1,056 $2,052 $4,146

Option 6

California $0 - $10 $20 $47 $110 $30 $57 $120

North Atlantic $0 - $3 $29 $63 $138 $32 $66 $141

Mid-Atlantic $0 - $26 $241 $510 $1,083 $267 $535 $1,109

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $83 $263 $589 $1,325 $346 $672 $1,408

Great Lakes $0 - $25 $192 $386 $758 $217 $411 $783

Inlandd n/a $189 $357 $673 $189 $357 $673

National Total $0 - $146 $934 $1,952 $4,087 $1,080 $2,098 $4,233

a

 All benefits presented in this table are annualized. These annualized benefits represent the value of all benefits generated over the

time frame of the analysis, discounted to 2007, and then annualized over a 30-year period. b

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. A

range of recreational fishing benefits is provided, based on the Krinsky and Robb technique to estimated the 95th and 5th

percentile limits on the marginal value per fish predicted by EPA’s meta-analysis (see chapter A5 of the RBA). Commercial

fishing benefits are computed based on a range from 0% to 40% of the change in gross revenue (see Chapter A4 of the RBA). To

calculate the total use value columns (low, mean, and high), the high end value for commercial fishing benefits is added to the low,

mean, and high values for recreational fishing benefits, respectively. c

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with

these options. d

 No significant commercial fishing takes place in the Inland region, and thus this region is excluded from the commercial fishing

benefits analysis.

Source: U.S. EPA Analysis, 2004.
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

E2A-11

Table E2A-8: Summary of Monetized Benefits for Existing Phase III Facilitiesa

(thousands; 2003$, discounted at 7%)

Region

Annualized Use Benefits of I&E Reductions

Annualized

Commercial

Fishing

Recreational Fishing Total Use Valueb

Low Mean High Low Mean High

Option 3

California $0 - $4 $8 $19 $45 $12 $23 $49

North Atlantic $0 - $2 $22 $49 $107 $25 $51 $109

Mid-Atlantic $0 - $19 $181 $383 $814 $201 $403 $834

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $64 $206 $462 $1,038 $270 $526 $1,102

Great Lakes $0 - $18 $138 $277 $543 $156 $295 $561

Inlandd n/a $144 $273 $515 $144 $273 $515

National Total $0 - $107 $700 $1,463 $3,063 $807 $1,570 $3,170

Option 4

California $0 - $8 $16 $37 $86 $24 $44 $94

North Atlantic $0 - $2 $22 $49 $107 $25 $51 $109

Mid-Atlantic $0 - $19 $184 $388 $825 $203 $408 $844

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $66 $209 $469 $1,055 $275 $535 $1,120

Great Lakes $0 - $18 $139 $280 $549 $157 $298 $567

Inlandd n/a $133 $251 $473 $133 $251 $473

National Total $0 - $114 $703 $1,473 $3,095 $816 $1,587 $3,208

Option 2

California $0 - $8 $16 $37 $86 $24 $44 $94

North Atlantic $0 - $2 $22 $49 $107 $25 $51 $109

Mid-Atlantic $0 - $19 $184 $388 $825 $203 $408 $844

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $66 $209 $469 $1,055 $275 $535 $1,120

Great Lakes $0 - $18 $139 $280 $549 $157 $298 $567

Inlandd n/a $133 $251 $473 $133 $251 $473

National Total $0 - $114 $703 $1,473 $3,095 $816 $1,587 $3,208

Option 1

California $0 - $8 $16 $37 $86 $24 $44 $94

North Atlantic $0 - $2 $22 $49 $107 $25 $51 $109

Mid-Atlantic $0 - $19 $184 $388 $825 $203 $408 $844

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $66 $209 $469 $1,055 $275 $535 $1,120

Great Lakes $0 - $18 $139 $280 $549 $157 $298 $567

Inlandd n/a $149 $281 $531 $149 $281 $531
Section 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E2

Table E2A-8: Summary of Monetized Benefits for Existing Phase III Facilitiesa

(thousands; 2003$, discounted at 7%)

Region

Annualized Use Benefits of I&E Reductions

Annualized

Commercial

Fishing

Recreational Fishing Total Use Valueb

Low Mean High Low Mean High

E2A-12

National Total $0 - $114 $719 $1,504 $3,152 $832 $1,617 $3,266

Option 6

California $0 - $8 $16 $37 $86 $24 $44 $94

North Atlantic $0 - $2 $22 $49 $107 $25 $51 $109

Mid-Atlantic $0 - $20 $185 $391 $831 $205 $411 $850

South Atlanticc $0 $0 $0 $0 $0 $0 $0

Gulf of Mexico $0 - $66 $209 $469 $1,055 $275 $535 $1,120

Great Lakes $0 - $20 $150 $302 $592 $170 $322 $612

Inlandd n/a $154 $291 $549 $154 $291 $549

National Total $0 - $115 $736 $1,539 $3,220 $852 $1,654 $3,335

a

 All benefits presented in this table are annualized. These annualized benefits represent the value of all benefits generated over the

time frame of the analysis, discounted to 2007, and then annualized over a 30-year period. b

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. A

range of recreational fishing benefits is provided, based on the Krinsky and Robb technique to estimated the 95th and 5th

percentile limits on the marginal value per fish predicted by EPA’s meta-analysis (see chapter A5 of the RBA). Commercial

fishing benefits are computed based on a range from 0% to 40% of the change in gross revenue (see Chapter A4 of the RBA). To

calculate the total use value columns (low, mean, and high), the high end value for commercial fishing benefits is added to the low,

mean, and high values for recreational fishing benefits, respectively. c

 No I&E reductions are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with

these options. d

 No significant commercial fishing takes place in the Inland region, and thus this region is excluded from the commercial fishing

benefits analysis.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-1

CHAPTER CONTENTS

E3-1 Comparison of Benefits and Social Costs by

Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3-2

E3-2 Incremental Analysis of Benefits and Social Costs E3-7

E3-3 Break-Even Analysis of Potential Non-Use

Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3-8

Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3-12

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3-13

Appendix to Chapter E3 . . . . . . . . . . . . . . . . . . . . . . . E3A-1

Chapter E3: Comparison of Benefits and

Social Costs

INTRODUCTION

This chapter compares total monetized benefits to

total social costs for the options analyzed for the

Proposed Section 316(b) Rule for Phase III

Facilities. Benefits and costs are compared on two

bases: (1) for each of the options analyzed and (2)

incrementally across options. For more information

on the analysis of social costs and benefits, see

Chapter E1: Summary of Social Costs and Chapter

E2: Summary of Benefits.

EPA considered and analyzed three proposed options and five other options for Phase III existing facilities

(Manufacturers and Generators) in developing the proposed rule. New offshore oil and gas extraction facilities

were excluded from the comparison of benefits and costs because EPA was unable to estimate benefits for this

industry segment. This chapter presents results for the three proposed options for existing facilities: the “50 MGD

for All Waterbodies” option (“50 MGD All”), the “200 MGD for All Waterbodies” option (“200 MGD All”), and

the “100 MGD for Certain Waterbodies” option (“100 MGD CWB”). Summary results for five other options

evaluated in regulation development are presented in the appendix to this chapter.

Table E3-1 shows compliance action assumptions for the three proposed options based on the performance

standard each facility would need to meet (depending on each facility’s waterbody type, design intake flow,

capacity utilization, and annual intake flow as a percent of source waterbody mean annual flow) and its baseline

technologies in-place.

Table E3-1: Number of Existing Phase III Facilities by Compliance Actiona

Facility Compliance Action 50 MGD All 200 MGD All 100 MGD CWB

Total Facilities Potentially Subject to Regulation

(excluding baseline closures) 603 603 603

Facilities Subject to Best Professional Judgment 468 579 584

Facilities Subject to National Categorical Requirements 136 25 19

No compliance actionb 32 2 1

Impingement controls only 37 3 0

Impingement and entrainment controls 66 19 18

a

 Alternative less stringent requirements based on site-specific assessments of costs, or costs and benefits are allowed. Estimation

of compliance responses is uncertain because the number of facilities requesting alternative less stringent requirements based on

these site-specific assessments is unknown. b

 These facilities meet compliance requirements in the baseline and thus would require no action to comply with the regulation.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-2

E3-1 COMPARISON OF BENEFITS AND SOCIAL COSTS BY OPTION

The preceding chapters, Chapter E1: Summary of Social Costs and Chapter E2: Summary of Benefits, present

estimates of total social cost and benefit for the three proposed and five other options evaluated in developing the

316(b) Phase III regulation. Based on these values of estimated benefits and social costs, EPA calculated the net

monetized benefit to society of each option.

As documented in Chapter E2: Summary of Benefits, the monetized benefit values developed by EPA for the

316(b) Phase III regulation, and included in the net benefits calculation presented in this chapter, include only use

benefit values for commercial and recreational fishing. EPA was unable to estimate, at this time, a monetized

value of non-use benefits from reduced impingement and entrainment (I&E). As a result, the monetized benefit

value that is compared with the estimated value of total social cost in this benefit-cost comparison, is narrow in

conceptual scope and omits a benefit category with potentially large monetary value. Specifically, the Agency

was unable to monetize benefits for 96.7% of the age-one equivalent losses of all commercial, recreational, and

forage species considered for the options for Phase III existing facilities. As a result, the benefits estimates used

in this analysis represent the benefits associated with only about 3.3% of the total avoided loss in age-one

equivalents. Accordingly, the net benefit values presented in this chapter are based on comparison of a

substantially complete estimate of costs to society with a substantially incomplete estimate of benefits.

Table E3-2, below, presents EPA’s estimates of use benefits and social costs for the three proposed options for

existing facilities, at 3% and 7% discount rates. At a 3% discount rate, EPA estimates that social costs exceed use

benefits by $45.4 million under the 50 MGD All option, $21.5 million under the 200 MGD All option, and $16.2

million under the 100 MGD CWB option. At a 7% discount rate, social costs exceed use benefits by $48.6

million under the 50 MGD All option, $23.1 million under the 200 MGD All option, and $17.2 million under the

100 MGD CWB option. These values are all in dollars as of mid-year 2003 and are based on the discounting of

costs and benefits to beginning of year 2007, the assumed date when the proposed rule would take effect.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-3

Table E3-2: Total Benefits, Social Costs, and Net Benefits for Existing Phase III Facilities

by Option (millions; 2003$)

Option

Total Monetized Use Benefitsa

Total Social

Costs

Net Benefits Based on 

Use Benefits Onlyb

Low Mean High Low Mean High

3% discount rate

50 MGD All $1.0 $1.9 $3.8 $47.3 ($46.4) ($45.4) ($43.5)

200 MGD All $0.6 $1.3 $2.5 $22.8 ($22.1) ($21.5) ($20.2)

100 MGD CWB $0.7 $1.4 $2.9 $17.6 ($16.9) ($16.2) ($14.7)

7% discount rate

50 MGD All $0.8 $1.5 $3.0 $50.1 ($49.3) ($48.6) ($47.1)

200 MGD All $0.5 $1.0 $2.0 $24.1 ($23.6) ($23.1) ($22.1)

100 MGD CWB $0.6 $1.1 $2.3 $18.3 ($17.7) ($17.2) ($16.0)

a

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. The

range (low, mean, and high) of annualized use values is computed by adding the high end value for commercial fishing benefits

(based on assumed producer surplus of 40% of gross revenue) to the low, mean, and high values from recreational fishing benefits,

respectively (see Chapter A4 of the RBA). b Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution.

Source: U.S. EPA Analysis, 2004.

This comparison of fairly complete costs and incomplete benefits provides an incomplete assessment of net

benefits to society. The proposed options are expected to provide benefits that were not accounted for in the

benefits analysis. These benefits include reduced I&E losses of fish, shellfish, and other aquatic organisms,

which, in turn, increase the numbers of individuals present, increase local and regional fishery populations (a

subset of which was accounted for in the benefits analysis), and ultimately contribute to the enhanced

environmental functioning of affected waterbodies (rivers, lakes, estuaries, and oceans) and associated

ecosystems. See Chapter A6 of the Regional Benefits Assessment for the Proposed Section 316(b) Rule for Phase

III Facilities (RBA) for a detailed description of the ecological benefits from reduced I&E (U.S. EPA, 2004). 

Taking into account these additional unquantified benefits of improved fisheries and aquatic ecosystem

functioning, the Agency believes that the total benefits to society of the proposed rule for Phase III existing

facilities could potentially exceed total social costs. 

Tables E3-3 and E3-4 present total net benefits for existing Phase III facilities by option and region, discounted at

3% and 7%, respectively. As reported in Tables E3-3 and E3-4, EPA estimates that costs are largest relative to

benefits in the Inland region for the 50 MGD All and 200 MGD All options, and in the Gulf of Mexico region for

the 100 MGD CWB option. Conversely, costs outweigh benefits by the least amount in the California region for

the 50 MGD All option, in the North Atlantic region for the 200 MGD All option, and in the Mid-Atlantic region

for the 100 MGD CWB option.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-4

Table E3-3: Total Net Benefits for Existing Phase III Facilities

by Option and Region (millions; 2003$, discounted at 3%)

Option

Net Benefits Based on Use Benefits Onlya

California North

Atlantic Mid-Atlantic South

Atlanticb

Gulf of

Mexico

Great

Lakes Inland National

Total

Low

50 MGD All ($0.8) ($4.5) ($2.3) $0.0 ($8.7) ($9.9) ($19.5) ($46.4)

200 MGD All $0.0 ($0.5) ($1.7) $0.0 ($3.6) ($3.9) ($12.2) ($22.1)

100 MGD CWB $0.0 ($2.0) ($1.7) $0.0 ($8.7) ($4.3) $0.0 ($16.9)

Mean

50 MGD All ($0.8) ($4.5) ($2.0) $0.0 ($8.4) ($9.7) ($19.4) ($45.4)

200 MGD All $0.0 ($0.5) ($1.5) $0.0 ($3.5) ($3.8) ($12.1) ($21.5)

100 MGD CWB $0.0 ($1.9) ($1.5) $0.0 ($8.4) ($4.2) $0.0 ($16.2)

High

50 MGD All ($0.8) ($4.4) ($1.5) $0.0 ($7.7) ($9.4) ($19.1) ($43.5)

200 MGD All $0.0 ($0.5) ($1.0) $0.0 ($3.1) ($3.6) ($11.9) ($20.2)

100 MGD CWB $0.0 ($1.9) ($1.0) $0.0 ($7.7) ($4.0) $0.0 ($14.7)

a

 Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution. b

 No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 50 MGD and therefore would not be required to install technologies to comply with the proposed options.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-5

Table E3-4: Total Net Benefits for Existing Phase III Facilities

by Option and Region (millions; 2003$, discounted at 7%)

Option

Net Benefits Based on Use Benefits Onlya

California North

Atlantic Mid-Atlantic South

Atlanticb

Gulf of

Mexico Great Lakes Inland National

Total

Low

50 MGD All ($1.0) ($5.0) ($2.2) $0.0 ($9.9) ($10.1) ($20.5) ($49.3)

200 MGD All $0.0 ($0.5) ($1.6) $0.0 ($4.2) ($3.6) ($13.6) ($23.6)

100 MGD CWB $0.0 ($2.0) ($1.6) $0.0 ($9.9) ($4.0) $0.0 ($17.7)

Mean

50 MGD All ($0.9) ($5.0) ($2.0) $0.0 ($9.7) ($9.9) ($20.4) ($48.6)

200 MGD All $0.0 ($0.5) ($1.4) $0.0 ($4.1) ($3.5) ($13.5) ($23.1)

100 MGD CWB $0.0 ($2.0) ($1.4) $0.0 ($9.7) ($3.9) $0.0 ($17.2)

High

50 MGD All ($0.9) ($4.9) ($1.6) $0.0 ($9.1) ($9.7) ($20.2) ($47.1)

200 MGD All $0.0 ($0.4) ($1.1) $0.0 ($3.8) ($3.3) ($13.4) ($22.1)

100 MGD CWB $0.0 ($1.9) ($1.1) $0.0 ($9.1) ($3.7) $0.0 ($16.0)

a

 Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution. b

 No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw less

than 50 MGD and therefore would not be required to install technologies to comply with the proposed options.

Source: U.S. EPA Analysis, 2004.

Table E3-5, on the following page, provides additional detail on the net benefits calculation. Table E3-5

compiles, for the three proposed options, the time profiles of benefits and costs as presented in the preceding

chapters. The table also reports the calculated present and annualized values of benefits and costs at 3% and 7%

discount rates.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-6

Table E3-5: Time Profile of Benefits and Social Costs for Existing Phase III Facilities

(millions; 2003$)

Year

50 MGD All 200 MGD All 100 MGD CWB

Monetized

Benefits

Total Cost 

(excl. O&G)

Monetized

Benefits

Total Cost 

(excl. O&G)

Monetized

Benefits

Total Cost 

(excl. O&G)

2007 $0.00 $3.3 $0.00 $0.2 $0.00 $0.6

2008 $0.00 $10.2 $0.00 $1.4 $0.00 $3.8

2009 $0.00 $15.4 $0.00 $2.1 $0.00 $3.9

2010 $0.01 $172.6 $0.00 $129.1 $0.00 $9.0

2011 $0.05 $180.5 $0.03 $83.8 $0.01 $139.7

2012 $0.22 $74.4 $0.11 $12.3 $0.09 $11.5

2013 $0.63 $110.8 $0.34 $45.8 $0.27 $35.3

2014 $1.28 $22.2 $0.70 $7.5 $0.85 $5.4

2015 $1.83 $22.7 $1.16 $8.5 $1.32 $8.3

2016 $2.12 $18.6 $1.40 $7.5 $1.57 $5.4

2017 $2.22 $18.6 $1.47 $9.0 $1.66 $6.6

2018 $2.27 $15.3 $1.52 $7.5 $1.70 $5.3

2019 $2.29 $19.0 $1.53 $7.3 $1.72 $5.2

2020 $2.29 $44.5 $1.53 $12.7 $1.72 $8.3

2021 $2.29 $81.7 $1.53 $40.0 $1.72 $41.4

2022 $2.29 $29.2 $1.53 $14.6 $1.72 $12.2

2023 $2.29 $58.2 $1.53 $45.8 $1.72 $35.4

2024 $2.29 $22.1 $1.53 $7.4 $1.72 $5.4

2025 $2.29 $22.7 $1.53 $8.5 $1.72 $8.3

2026 $2.29 $18.6 $1.53 $7.5 $1.72 $5.4

2027 $2.29 $18.6 $1.53 $9.0 $1.72 $6.6

2028 $2.29 $15.3 $1.53 $7.5 $1.72 $5.3

2029 $2.29 $19.0 $1.53 $7.3 $1.72 $5.2

2030 $2.29 $44.5 $1.53 $12.7 $1.72 $8.3

2031 $2.29 $81.7 $1.53 $40.0 $1.72 $41.4

2032 $2.29 $29.2 $1.53 $14.6 $1.72 $12.2

2033 $2.29 $58.2 $1.53 $45.8 $1.72 $35.4

2034 $2.29 $22.1 $1.53 $7.4 $1.72 $5.4

2035 $2.29 $22.7 $1.53 $8.5 $1.72 $8.3

2036 $2.29 $18.6 $1.53 $7.5 $1.72 $5.4

2037 $2.29 $18.6 $1.53 $9.0 $1.72 $6.6

2038 $2.29 $15.3 $1.53 $7.5 $1.72 $5.3

2039 $2.29 $14.4 $1.53 $7.1 $1.72 $4.8

2040 $2.28 $12.1 $1.53 $6.8 $1.72 $4.7

2041 $2.23 $6.3 $1.50 $3.9 $1.71 $2.2

2042 $2.06 $4.1 $1.42 $3.1 $1.62 $1.3

2043 $1.66 $0.5 $1.19 $0.4 $1.45 $0.4

2044 $1.01 $0.0 $0.83 $0.0 $0.87 $0.0

2045 $0.46 $0.0 $0.37 $0.0 $0.40 $0.0

2046 $0.17 $0.0 $0.13 $0.0 $0.15 $0.0

2047 $0.06 $0.0 $0.06 $0.0 $0.05 $0.0

2048 $0.01 $0.0 $0.01 $0.0 $0.01 $0.0

PV 3% $37.18 $955.8 $24.70 $459.7 $27.65 $355.9

Annualized 3% $1.90 $47.3 $1.26 $22.8 $1.41 $17.6

PV 7% $18.56 $665.0 $12.21 $320.3 $13.63 $242.5

Annualized 7% $1.50 $50.1 $0.98 $24.1 $1.10 $18.3

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-7

E3-2 INCREMENTAL ANALYSIS OF BENEFITS AND SOCIAL COSTS

In addition to comparing benefits and costs for each proposed option, as presented in the preceding section, EPA

also analyzed the benefits and costs of the three options on an incremental basis. The comparison in the

preceding section addresses the simple quantitative relationship between estimated benefits and costs for each

option by itself: for a given option, which is greater – benefits or costs – and what is the amount of difference? In

contrast, incremental analysis looks at the differential relationship of benefits and costs across options and poses a

different question: as increasingly more costly options are considered, by what amount do benefits, costs, and net

benefits change from option to option? Incremental benefit-cost analysis provides insight into the net gain to

society from imposing increasingly more costly requirements and may aid regulatory decision-makers in choosing

among a set of regulatory proposals that otherwise have a similar quantitative relationship between benefits and

costs based on a one-option-at-a-time comparison.

The Agency conducted the incremental benefit-cost analysis by calculating, for each option, the change in net

benefits, from option to option, in moving from the least costly option to successively more costly options. As

described previously, the three proposed options – the 50 MGD All, 200 MGD All, and 100 MGD CWB

options – differ in terms of design intake flow (DIF) applicability threshold and affected waterbodies. Thus the

difference in benefits and costs across the options derives from the number of facilities each option is expected to

cover and what types of waterbodies are affected. As reported in Table E3-6, at a 3% discount rate, the

incremental change in net benefits in moving from the 100 MGD CWB option to the 200 MGD All option is -$5.3

million, and from the 200 MGD All option to the 50 MGD All option, is -$23.9 million. Thus, for both

incremental steps, calculated net benefits become increasingly more negative but the step from the 200 MGD All

option to the 50 MGD All option is more costly to society, on a net benefit basis, than the step from the 100 MGD

CWB option to the 200 MGD All option. The same pattern of change occurs for the calculations under a 7%

discount rate: the incremental change in net benefits in moving from the 100 MGD CWB option to the 200 MGD

All option is -$6.0 million, and from the 200 MGD All option to the 50 MGD All option, is -$25.4 million.

Table E3-6: Incremental Benefit-Cost Analysis for Existing Phase III Facilities (millions; 2003$)

Optiona

Net Benefits Based on 

Use Benefits Onlyb Incremental Net Benefitsc

Low Mean High Low Mean High

3% discount rate

100 MGD CWB ($16.9) ($16.2) ($14.7) n/a n/a n/a

200 MGD All ($22.1) ($21.5) ($20.2) ($5.2) ($5.3) ($5.5)

50 MGD All ($46.4) ($45.4) ($43.5) ($24.2) ($23.9) ($23.3)

7% discount rate

100 MGD CWB ($17.7) ($17.2) ($16.0) n/a n/a n/a

200 MGD All ($23.6) ($23.1) ($22.1) ($5.9) ($6.0) ($6.1)

50 MGD All ($49.3) ($48.6) ($47.1) ($25.7) ($25.4) ($24.9)

a Options are presented in order of increasing applicability, based on the number of facilities regulated. b Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution. c Incremental net benefits are equal to the difference between net benefits of a given option and the net benefits of the previous less

stringent option.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

1

 See chapter E2 for details on the estimation of age-1 equivalents.

E3-8

E3-3 BREAK-EVEN ANALYSIS OF POTENTIAL NON-USE BENEFITS

As described in Section E3-1, above, EPA’s monetized estimates of benefits for the 316(b) Phase III regulation

consider only the use benefit values for commercial and recreational fishing, and exclude non-use benefits. 

Estimating non-use benefit values is a very challenging and uncertain exercise, particularly when primary

research using stated preference methods is not a feasible option (as is the case for the proposed rulemaking). In

Chapter A3 of the RBA, EPA described alternative approaches for developing non-use benefit estimates based on

benefits transfer and associated methods. Because of the uncertainty in estimating the non-use benefits of the

options evaluated for the proposed rule, the Agency assessed non-use benefits only qualitatively (see Chapter A6

of RBA for a qualitative assessment of non-use benefits). As a result, the comparison of costs and benefits

presented in Sections E3-1 and E3-2 involves a substantially more complete accounting of costs than of benefits. 

On the basis of this limited, incomplete accounting of benefits and costs, EPA found that costs exceed use benefits

for each of the three proposed options.

Although EPA did not specifically estimate the non-use benefits of the 316(b) Phase III regulation, it is possible

to calculate the amount of non-use benefits that would be needed for the regulation’s benefits to equal the

estimated total costs (the “break-even” non-use benefits value). Regulatory decision-makers may then judge the

reasonableness of these required values in assessing whether the regulation is likely, overall, to achieve total

benefits to society that exceed costs.

To perform this break-even analysis, EPA subtracted the estimated commercial and recreational use benefits from

the estimated annual costs. EPA then used this required residual to calculate the non-use benefit value, in terms

of annual willingness-to-pay (WTP), needed for total benefits to equal total costs. This calculation was done in

two different ways: (1) on a per household basis and (2) on a per age-1 equivalent basis. EPA performed this

analysis using the regional studies framework as described in the RBA. This approach assumes that all of the

facilities in the sample weight of a given sample facility are in the same benefits analysis region as the sample

facility.

For the WTP per household analysis, this approach also assumes that the size and other characteristics of potential

use and non-use benefit populations, which are assessed for the sample facility, may be extended to the weight of

the sample facility. Although this assumption embeds considerable uncertainty, it permits the estimation of a nonuse benefit population for each facility, which may then be used to calculate the WTP value by household that

equates total benefits and total costs, on a sample-weighted basis, for each option. For this analysis, EPA

assumed that only anglers fishing in the region and households within a 25-mile radius of the facility hold non-use

values for the affected resources (BLS, 2000).1

At the national level, EPA estimated the following (see Table E3-7 below):

< WTP per household. Under the 50 MGD All option, non-use benefit values per household would have

to be $1.99 (3% discount rate) and $2.13 (7% discount rate) for total annual benefits to equal total

annualized costs. Under the 200 MGD All option, which applies to the next smaller set of facilities, these

values decrease to $1.87 (3% discount rate) and $2.01 (7% discount rate). Under the 100 MGD CWB

option, which applies to the smallest set of facilities of the three proposed options, these values decrease,

to $1.43 (3% discount rate) and $1.52 (7% discount rate).

< WTP per age-1 equivalent. Under the 50 MGD All option, non-use benefit values per age-1 equivalent

would have to be $0.92 (3% discount rate) and $0.98 (7% discount rate) for total annual benefits to equal

total annualized costs. Under the 200 MGD All option, which applies to the next smaller set of facilities,

these values decrease to $0.63 (3% discount rate) and $0.68 (7% discount rate). Under the 100 MGD

CWB option, which applies to the smallest set of facilities of the three proposed options, these values

decrease, to $0.54 (3% discount rate) and $0.58 (7% discount rate).
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-9

Table E3-7: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis (2003$)

Option

Total

Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

3% Discount Rate

50 MGD All $47.3 $1.9 $45.4 22,784,450 $1.99 49,493,000 $0.92

200 MGD All $22.8 $1.3 $21.5 11,524,368 $1.87 34,038,000 $0.63

100 MGD CWB $17.6 $1.4 $16.2 11,328,241 $1.43 29,774,000 $0.54

7% Discount Rate

50 MGD All $50.1 $1.5 $48.6 22,784,450 $2.13 49,493,000 $0.98

200 MGD All $24.1 $1.0 $23.1 11,524,368 $2.01 34,038,000 $0.68

100 MGD CWB $18.3 $1.1 $17.2 11,328,241 $1.52 29,774,000 $0.58

a

 The non-use benefits category in this table may include some categories of use values that were not taken into account by the

recreation and commercial fishing analyses. b

 The non-use value per age-1 equivalent reported in the table includes the value placed on the fish’s contribution to non-use

ecological services (e.g., population, health, sustainability, and overall ecosystem health).

Source: U.S. EPA Analysis, 2004.

EPA also calculated the annual WTP needed on a per household basis and a per age-1 equivalent basis at the

regional level (see Tables E3-8 and E3-9 below). EPA estimated the following:

< WTP per household. The Gulf of Mexico region has the highest estimated annual break-even WTP

values per household with $6.38, $13.83, and $6.38 (3% discount rate) and $7.34, $16.31, and $7.34 (7%

discount rate) under the 50 MGD All, the 200 MGD All, and the 100 MGD CWB options, respectively. 

The Mid-Atlantic region has the lowest estimated annual break-even WTP values per household with

$0.35, $0.27, and $0.27 (3% discount rate) and $0.35, $0.25, and $0.25 (7% discount rate) under the 50

MGD All, the 200 MGD All, and the 100 MGD CWB options, respectively.

< WTP per age-1 equivalent. The North Atlantic region has the highest estimated annual break-even

WTP value per age-1 equivalent with $4.84, $2.51, and $2.56 (3% discount rate) and $5.37, $2.28, and

$2.62 (7% discount rate) under the 50 MGD All, the 200 MGD All, and the 100 MGD CWB options,

respectively. The Mid-Atlantic region has the lowest estimated annual break-even WTP values per age-1

equivalent with $0.15, $0.13, and $0.13 (3% discount rate) and $0.15, $0.12, and $0.12 (7% discount

rate) under the 50 MGD All, the 200 MGD All, and the 100 MGD CWB options, respectively.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-10

Table E3-8: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis by Regions (2003$, discounted at 3%)

Option

Total Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

50 MGD All

California $0.8 $0.0d $0.8 1,166,416 $0.70 383,000 $2.14

North Atlantic $4.6 $0.1 $4.5 2,129,180 $2.11 930,000 $4.84

Mid-Atlantic $2.6 $0.5 $2.0 5,887,031 $0.35 13,400,000 $0.15

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$9.1 $0.6 $8.4 1,322,480 $6.38 8,380,000 $1.01

Great Lakes $10.1 $0.3 $9.7 4,064,660 $2.40 11,600,000 $0.84

Inland $19.7 $0.3 $19.4 8,214,682 $2.36 14,800,000 $1.31

National Total $47.3 $1.9 $45.4 22,784,450 $1.99 49,493,000 $0.92

200 MGD All

California $0.0 $0.0 $0.0 0 $0.00 0 $0.00

North Atlantic $0.5 $0.0d $0.5 1,699,855 $0.29 198,000 $2.51

Mid-Atlantic $2.0 $0.5 $1.5 5,603,551 $0.27 11,900,000 $0.13

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$3.8 $0.3 $3.5 251,666 $13.83 4,580,000 $0.76

Great Lakes $4.1 $0.2 $3.8 2,388,297 $1.60 7,710,000 $0.50

Inland $12.3 $0.2 $12.1 1,580,998 $7.65 9,650,000 $1.25

National Total $22.8 $1.3 $21.5 11,524,368 $1.87 34,038,000 $0.63

100 MGD CWB

California $0.0 $0.0 $0.0 0 $0.00 0 $0.00

North Atlantic $2.0 $0.1 $1.9 1,989,096 $0.97 754,000 $2.56

Mid-Atlantic $2.0 $0.5 $1.5 5,603,551 $0.27 11,900,000 $0.13

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$9.1 $0.6 $8.4 1,322,480 $6.38 8,380,000 $1.01

Great Lakes $4.5 $0.3 $4.2 2,413,114 $1.74 8,740,000 $0.48

Inland $0.0 $0.0 $0.0 0 $0.00 0 $0.00

National Total $17.6 $1.4 $16.2 11,328,241 $1.43 29,774,000 $0.54

a

 The non-use benefits category in this table may include some categories of use values that were not taken into account by the

recreation and commercial fishing analyses. b

 The non-use value per age-1 equivalent reported in the table includes the value placed on the fish’s contribution to non-use

ecological services (e.g., population, health, sustainability, and overall ecosystem health). c

 No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw

less than 50 MGD and therefore would not be required to install technologies to comply with the proposed options. d

 Positive non-zero value less than $50,000. 

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-11

Table E3-9: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis by Regions (2003$, discounted at 7%)

Option

Total

Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

50 MGD All

California $1.0 $0.0d $0.9 1,166,416 $0.81 383,000 $2.48

North Atlantic $5.0 $0.1 $5.0 2,129,180 $2.35 930,000 $5.37

Mid-Atlantic $2.4 $0.4 $2.0 5,887,031 $0.35 13,400,000 $0.15

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of Mexico $10.2 $0.5 $9.7 1,322,480 $7.34 8,380,000 $1.16

Great Lakes $10.2 $0.3 $9.9 4,064,660 $2.45 11,600,000 $0.86

Inland $20.6 $0.3 $20.4 8,214,682 $2.48 14,800,000 $1.38

National Total $50.1 $1.5 $48.6 22,784,450 $2.13 49,493,000 $0.98

200 MGD All

California $0.0 $0.0 $0.0 0 $0.00 0 $0.00

North Atlantic $0.5 $0.0d $0.5 1,699,855 $0.27 198,000 $2.28

Mid-Atlantic $1.8 $0.4 $1.4 5,603,551 $0.25 11,900,000 $0.12

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of Mexico $4.4 $0.3 $4.1 251,666 $16.31 4,580,000 $0.90

Great Lakes $3.7 $0.2 $3.5 2,388,297 $1.47 7,710,000 $0.45

Inland $13.7 $0.2 $13.5 1,580,998 $8.56 9,650,000 $1.40

National Total $24.1 $1.0 $23.1 11,524,368 $2.01 34,038,000 $0.68

100 MGD CWB

California $0.0 $0.0 $0.0 0 $0.00 0 $0.00

North Atlantic $2.0 $0.0d $2.0 1,989,096 $0.99 754,000 $2.62

Mid-Atlantic $1.8 $0.4 $1.4 5,603,551 $0.25 11,900,000 $0.12

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of Mexico $10.2 $0.5 $9.7 1,322,480 $7.34 8,380,000 $1.16

Great Lakes $4.1 $0.2 $3.9 2,413,114 $1.62 8,740,000 $0.45

Inland $0.0 $0.0 $0.0 0 $0.00 0 $0.00

National Total $18.3 $1.1 $17.2 11,328,241 $1.52 29,774,000 $0.58

a

 The non-use benefits category in this table may include some categories of use values that were not taken into account by the

recreation and commercial fishing analyses. b

 The non-use value per age-1 equivalent reported in the table includes the value placed on the fish’s contribution to non-use

ecological services (e.g., population, health, sustainability, and overall ecosystem health). c

 No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region withdraw

less than 50 MGD and therefore would not be required to install technologies to comply with the proposed options. d

 Positive non-zero value less than $50,000. 

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-12

GLOSSARY

opportunity cost: The lost value of alternative uses of resources (capital, labor, and raw materials) used in

regulatory compliance.

social cost: The costs incurred by society as a whole as a result of the proposed rule. Social costs do not

include costs that are transfers among parties that do not represent a new cost overall.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-13

REFERENCES

U.S. Department of Commerce, Bureau of the Census, Bureau of Labor Statistics (BLS). 2000. “Summary File

1.” Available at: http://www.census.gov/Press-Release/www/2001/sumfile1.html.

U.S. Environmental Protection Agency (U.S. EPA). 2004. The Regional Benefits Assessment for the Proposed

Section 316(b) Rule for Phase III Facilities. EPA-821-R-04-017. November 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis E3: Benefit-Cost Analysis

E3-14

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§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-1

Appendix to Chapter E3

INTRODUCTION

This appendix presents results from EPA’s analysis

of the benefits and costs of the 316(b) Phase III

regulation for five additional options evaluated for

Phase III existing facilities. Results are presented for

the comparison of benefits and costs and the

breakeven assessment of non-use benefits. As

discussed previously in Chapter E3, the benefit and

cost values presented in this appendix pertain only to

the Manufacturers and Electric Generators segments of the industries subject to Phase III regulation.

EPA estimated the compliance response for each facility under each of the other options (see Table E3A-1,

below). In this table and the following tables, the options are listed in order of increasing cost, which reflects the

breadth of regulatory coverage based on design intake flow applicability threshold and the stringency of

compliance requirements. For a description of this analysis, see section E3-1 above.

Table E3A-1: Number of Existing Phase III Facilities by Compliance Actiona

Facility Compliance Action Option 3 Option 4 Option 2 Option 1 Option 6

Total Facilities Potentially Subject to Regulation

(excluding baseline closures) 603 603 603 603 603

Facilities Subject to Best Professional Judgment 235 415 235 251 0

Facilities Subject to National Categorical

Requirements 368 189 368 353 603

No compliance actionb 202 59 184 160 317

Impingement controls only 100 39 93 73 114

Impingement and entrainment controls 66 91 91 120 172

a

 Alternative less stringent requirements based on a site-specific assessment of costs, or costs and benefits, are allowed. The

estimate of number of facilities meeting specific requirements is uncertain because the number of facilities requesting alternative

less stringent requirements based on site-specific assessments is unknown. b

 These facilities already meet compliance requirements.

Source: U.S. EPA Analysis, 2004.

E3A-1 COMPARISON OF BENEFITS AND SOCIAL COSTS BY OPTION

Table E3A-2 on the following page reports benefits, costs, and net benefits for all five other options. For further

information on this analysis, see section E3-1, above.

APPENDIX CONTENTS

E3A-1 Comparison of Benefits and Social Costs by 

Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3A-1

E3A-2 Incremental Analysis of Benefits and Social 

Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3A-7

E3A-3 Break-Even Analysis of Potential Non-Use 

Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . E3A-7
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-2

Table E3A-2: Total Benefits, Social Costs, and Net Benefits for Existing Phase III Facilities

by Option (millions; 2003$)

Option

Total Monetized Use Benefitsa

Total Social Costs

Net Benefits Based on Use Benefits Onlyb

Low Mean High Low Mean High

3% Discount Rate

Option 3 $1.0 $2.0 $4.0 $65.0 ($64.0) ($63.1) ($61.0)

Option 4 $1.0 $2.0 $4.1 $67.9 ($66.9) ($65.9) ($63.8)

Option 2 $1.0 $2.0 $4.1 $73.7 ($72.6) ($71.7) ($69.6)

Option 1 $1.1 $2.1 $4.1 $76.1 ($75.0) ($74.0) ($71.9)

Option 6 $1.1 $2.1 $4.2 $95.7 ($94.6) ($93.6) ($91.5)

7% Discount Rate

Option 3 $0.8 $1.6 $3.2 $69.6 ($68.8) ($68.0) ($66.4)

Option 4 $0.8 $1.6 $3.2 $73.9 ($73.1) ($72.3) ($70.7)

Option 2 $0.8 $1.6 $3.2 $79.3 ($78.5) ($77.7) ($76.1)

Option 1 $0.8 $1.6 $3.3 $81.8 ($80.9) ($80.1) ($78.5)

Option 6 $0.9 $1.7 $3.3 $102.5 ($101.6) ($100.8) ($99.1)

a

 The total monetizable value of I&E reductions includes use benefits only. EPA evaluated non-use benefits only qualitatively. The

range (low, mean, and high) of annualized use values is computed by adding the high end value for commercial fishing benefits

(based on assumed producer surplus of 40% of gross revenue) to the low, mean, and high values from recreational fishing benefits,

respectively (see Chapter A4 of the RBA). b Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-3

Tables E3A-3 and E3A-4, below and following page, report net benefits, by option and benefit study region for,

respectively, the 3% and 7% discount rate calculations. For further information on this analysis, see section E3-1,

above.

Table E3A-3: Total Net Benefits for Existing Phase III Facilities by Option and Region 

(millions; 2003$, discounted at 3%)

Option

Net Benefits Based on Use Benefits Onlya

California North

Atlantic Mid-Atlantic South

Atlanticb

Gulf of

Mexico Great Lakes Inland National

Total

Low

Option 3 ($1.1) ($4.5) ($2.5) $0.0 ($9.2) ($20.4) ($25.0) ($64.0)

Option 4 ($1.5) ($4.5) ($3.0) $0.0 ($14.2) ($22.6) ($19.5) ($66.9)

Option 2 ($1.5) ($4.5) ($3.0) $0.0 ($14.2) ($22.6) ($25.0) ($72.6)

Option 1 ($1.5) ($4.5) ($3.0) $0.0 ($14.2) ($22.6) ($27.4) ($75.0)

Option 6 ($2.2) ($4.5) ($3.2) $0.0 ($14.2) ($28.4) ($39.8) ($94.6)

Mean

Option 3 ($1.1) ($4.5) ($2.2) $0.0 ($8.9) ($20.2) ($24.8) ($63.1)

Option 4 ($1.5) ($4.5) ($2.8) $0.0 ($13.8) ($22.5) ($19.4) ($65.9)

Option 2 ($1.5) ($4.5) ($2.8) $0.0 ($13.8) ($22.5) ($24.9) ($71.7)

Option 1 ($1.5) ($4.5) ($2.8) $0.0 ($13.8) ($22.5) ($27.2) ($74.0)

Option 6 ($2.2) ($4.5) ($3.0) $0.0 ($13.8) ($28.2) ($39.6) ($93.6)

High

Option 3 ($1.1) ($4.4) ($1.6) $0.0 ($8.1) ($19.9) ($24.5) ($61.0)

Option 4 ($1.4) ($4.4) ($2.2) $0.0 ($13.1) ($22.1) ($19.1) ($63.8)

Option 2 ($1.4) ($4.4) ($2.2) $0.0 ($13.1) ($22.1) ($24.6) ($69.6)

Option 1 ($1.4) ($4.4) ($2.2) $0.0 ($13.1) ($22.1) ($26.9) ($71.9)

Option 6 ($2.1) ($4.4) ($2.4) $0.0 ($13.1) ($27.8) ($39.3) ($91.5)

a

 Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution. b No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option.

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-4

Table E3A-4: Total Net Benefits for Existing Phase III Facilities by Option and Region

(millions; 2003$, discounted at 7%)

Option

Net Benefits Based on Use Benefits Onlya

California North

Atlantic

MidAtlanticSouth

Atlanticb

Gulf of

Mexico Great Lakes Inland National

Total

Low

Option 3 ($1.2) ($5.0) ($2.4) $0.0 ($10.4) ($22.7) ($25.7) ($68.8)

Option 4 ($1.6) ($5.0) ($2.9) $0.0 ($16.7) ($24.8) ($20.5) ($73.1)

Option 2 ($1.6) ($5.0) ($2.9) $0.0 ($16.7) ($24.8) ($25.7) ($78.5)

Option 1 ($1.6) ($5.0) ($2.9) $0.0 ($16.7) ($24.8) ($28.1) ($80.9)

Option 6 ($2.2) ($5.0) ($3.1) $0.0 ($16.7) ($30.7) ($41.6) ($101.6)

Mean

Option 3 ($1.2) ($5.0) ($2.2) $0.0 ($10.1) ($22.6) ($25.6) ($68.0)

Option 4 ($1.6) ($5.0) ($2.7) $0.0 ($16.5) ($24.7) ($20.4) ($72.3)

Option 2 ($1.6) ($5.0) ($2.7) $0.0 ($16.5) ($24.7) ($25.6) ($77.7)

Option 1 ($1.6) ($5.0) ($2.7) $0.0 ($16.5) ($24.7) ($28.0) ($80.1)

Option 6 ($2.2) ($5.0) ($2.9) $0.0 ($16.5) ($30.5) ($41.4) ($100.8)

High

Option 3 ($1.2) ($4.9) ($1.8) $0.0 ($9.6) ($22.3) ($25.4) ($66.4)

Option 4 ($1.5) ($4.9) ($2.3) $0.0 ($15.9) ($24.4) ($20.2) ($70.7)

Option 2 ($1.5) ($4.9) ($2.3) $0.0 ($15.9) ($24.4) ($25.4) ($76.1)

Option 1 ($1.5) ($4.9) ($2.3) $0.0 ($15.9) ($24.4) ($27.7) ($78.5)

Option 6 ($2.1) ($4.9) ($2.4) $0.0 ($15.9) ($30.2) ($41.2) ($99.1)

a

 Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution. b No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option.

Source: U.S. EPA Analysis, 2004.

Tables E3A-5 and E3A-6 compile the time profiles of benefits and costs for the five other options. The tables

also report the calculated present and annualized values of benefits and costs at 3% and 7% discount rates.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-5

Table E3A-5: Time Profile of Benefits and Costs for Existing Phase III Facilities

for Options 3, 4, and 2 (millions; 2003$)

Year

Option 3 Option 4 Option 2

Monetized

Benefits

Total Cost

(excl. O&G)

Monetized

Benefits

Total Cost

(excl. O&G)

Monetized

Benefits

Total Cost

(excl. O&G)

2007 $0.00 $3.9 $0.00 $3.3 $0.00 $3.9

2008 $0.00 $14.9 $0.00 $13.9 $0.00 $16.0

2009 $0.00 $24.8 $0.00 $23.0 $0.00 $27.4

2010 $0.01 $188.0 $0.01 $182.6 $0.01 $191.4

2011 $0.05 $196.1 $0.06 $296.5 $0.06 $305.5

2012 $0.23 $281.5 $0.23 $284.6 $0.23 $291.2

2013 $0.64 $119.0 $0.65 $117.7 $0.65 $124.1

2014 $1.35 $31.0 $1.36 $27.0 $1.36 $34.4

2015 $1.91 $30.6 $1.92 $29.9 $1.92 $33.6

2016 $2.23 $29.1 $2.25 $26.8 $2.25 $32.7

2017 $2.34 $25.9 $2.36 $24.8 $2.36 $28.8

2018 $2.39 $20.4 $2.41 $20.7 $2.41 $24.2

2019 $2.40 $25.0 $2.43 $22.6 $2.43 $27.3

2020 $2.40 $55.1 $2.43 $51.8 $2.43 $58.2

2021 $2.40 $95.6 $2.43 $91.9 $2.43 $100.0

2022 $2.40 $39.4 $2.43 $40.8 $2.43 $46.6

2023 $2.40 $66.1 $2.43 $65.2 $2.43 $71.4

2024 $2.40 $30.6 $2.43 $26.6 $2.43 $33.9

2025 $2.40 $30.6 $2.43 $29.9 $2.43 $33.6

2026 $2.40 $29.1 $2.43 $26.8 $2.43 $32.7

2027 $2.40 $25.9 $2.43 $24.8 $2.43 $28.8

2028 $2.40 $20.4 $2.43 $20.7 $2.43 $24.2

2029 $2.40 $25.0 $2.43 $22.6 $2.43 $27.3

2030 $2.40 $55.1 $2.43 $51.8 $2.43 $58.2

2031 $2.40 $95.6 $2.43 $91.9 $2.43 $100.0

2032 $2.40 $39.4 $2.43 $40.8 $2.43 $46.6

2033 $2.40 $66.1 $2.43 $65.2 $2.43 $71.4

2034 $2.40 $30.6 $2.43 $26.6 $2.43 $33.9

2035 $2.40 $30.6 $2.43 $29.9 $2.43 $33.6

2036 $2.40 $29.1 $2.43 $26.8 $2.43 $32.7

2037 $2.40 $25.9 $2.43 $24.8 $2.43 $28.8

2038 $2.40 $20.4 $2.43 $20.7 $2.43 $24.2

2039 $2.40 $18.3 $2.43 $18.0 $2.43 $20.7

2040 $2.39 $15.3 $2.42 $15.7 $2.42 $17.6

2041 $2.35 $8.8 $2.37 $8.7 $2.37 $10.3

2042 $2.17 $5.3 $2.19 $5.2 $2.19 $6.2

2043 $1.76 $1.0 $1.78 $0.9 $1.78 $1.3

2044 $1.06 $0.0 $1.07 $0.0 $1.07 $0.0

2045 $0.49 $0.0 $0.50 $0.0 $0.50 $0.0

2046 $0.18 $0.0 $0.18 $0.0 $0.18 $0.0

2047 $0.06 $0.0 $0.07 $0.0 $0.07 $0.0

2048 $0.02 $0.0 $0.02 $0.0 $0.02 $0.0

PV 3% $39.06 $1,313.2 $39.48 $1,371.2 $39.48 $1,487.3

Annualized 3% $1.99 $65.0 $2.01 $67.9 $2.01 $73.7

PV 7% $19.48 $923.8 $19.69 $980.8 $19.69 $1,053.3

Annualized 7% $1.57 $69.6 $1.59 $73.9 $1.59 $79.3

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-6

Table E3A-6: Time Profile of Benefits and Costs for Existing Phase III Facilities

for Options 1 and 6 (millions; 2003$)

Year

Option 1 Option 6

Monetized Benefits Total Cost

(excl. O&G)

Monetized Benefits Total Cost

(excl. O&G)

2007 $0.00 $3.9 $0.00 $6.0

2008 $0.00 $16.1 $0.00 $23.8

2009 $0.00 $27.9 $0.00 $38.7

2010 $0.01 $206.0 $0.01 $266.2

2011 $0.06 $306.9 $0.06 $410.1

2012 $0.24 $295.9 $0.25 $316.7

2013 $0.67 $125.3 $0.69 $137.6

2014 $1.39 $36.1 $1.42 $49.6

2015 $1.96 $34.9 $2.00 $46.8

2016 $2.29 $34.5 $2.34 $44.5

2017 $2.41 $30.2 $2.46 $41.1

2018 $2.46 $25.4 $2.51 $35.5

2019 $2.47 $28.6 $2.53 $39.6

2020 $2.47 $61.7 $2.53 $76.5

2021 $2.47 $101.8 $2.53 $129.5

2022 $2.47 $51.2 $2.53 $69.7

2023 $2.47 $72.7 $2.53 $84.3

2024 $2.47 $35.0 $2.53 $47.7

2025 $2.47 $34.9 $2.53 $46.7

2026 $2.47 $34.5 $2.53 $44.5

2027 $2.47 $30.2 $2.53 $41.1

2028 $2.47 $25.4 $2.53 $35.5

2029 $2.47 $28.6 $2.53 $39.6

2030 $2.47 $61.7 $2.53 $76.5

2031 $2.47 $101.8 $2.53 $129.5

2032 $2.47 $51.2 $2.53 $69.7

2033 $2.47 $72.7 $2.53 $84.3

2034 $2.47 $35.0 $2.53 $47.7

2035 $2.47 $34.9 $2.53 $46.7

2036 $2.47 $34.5 $2.53 $44.5

2037 $2.47 $30.2 $2.53 $41.1

2038 $2.47 $25.4 $2.53 $35.5

2039 $2.47 $21.9 $2.53 $28.7

2040 $2.47 $18.6 $2.52 $23.6

2041 $2.42 $11.4 $2.47 $14.2

2042 $2.23 $6.2 $2.27 $8.1

2043 $1.81 $1.4 $1.84 $2.2

2044 $1.09 $0.0 $1.11 $0.0

2045 $0.51 $0.0 $0.53 $0.0

2046 $0.18 $0.0 $0.19 $0.0

2047 $0.07 $0.0 $0.07 $0.0

2048 $0.02 $0.0 $0.02 $0.0

PV 3% $40.23 $1,535.7 $41.12 $1,932.0

Annualized 3% $2.05 $76.1 $2.10 $95.7

PV 7% $20.07 $1,085.6 $20.52 $1,360.3

Annualized 7% $1.62 $81.8 $1.65 $102.5

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-7

E3A-2 INCREMENTAL ANALYSIS OF BENEFITS AND SOCIAL COSTS

EPA conducted an incremental analysis of benefits and social costs to determine as increasingly more costly

options are considered, by what amount do benefits, costs, and net benefits change from option to option. Table

E3A-7, below, reports this analysis for the five other options evaluated. For a description of this analysis, see

section E3-2 above.

Table E3A-7: Incremental Benefit-Cost Analysis for Existing Phase III Facilities (millions; 2003$)

Optiona

Net Benefits Based on 

Use Benefits Onlyb Incremental Net Benefitsc

Low Mean High Low Mean High

3% discount rate

Option 3 ($64.0) ($63.1) ($61.0) n/a n/a n/a

Option 4 ($66.9) ($65.9) ($63.8) ($2.9) ($2.9) ($2.8)

Option 2 ($72.6) ($71.7) ($69.6) ($5.8) ($5.8) ($5.8)

Option 1 ($75.0) ($74.0) ($71.9) ($2.4) ($2.4) ($2.6)

Option 6 ($94.6) ($93.6) ($91.5) ($19.6) ($19.6) ($19.5)

7% discount rate

Option 3 ($68.8) ($68.0) ($66.4) n/a n/a n/a

Option 4 ($73.1) ($72.3) ($70.7) ($4.3) ($4.3) ($4.3)

Option 2 ($78.5) ($77.7) ($76.1) ($5.5) ($5.5) ($5.5)

Option 1 ($80.9) ($80.1) ($78.5) ($2.4) ($2.4) ($2.4)

Option 6 ($101.6) ($100.8) ($99.1) ($20.7) ($20.7) ($20.6)

a Options are presented in order of increasing applicability, based on the number of facilities regulated. b Net benefits are computed by subtracting total annualized costs from total annual use benefits. The net benefits presented here are

based on the comparison of a substantially complete measure of social costs with an incomplete measure of benefits and should be

interpreted with caution. c Incremental net benefits are equal to the difference between net benefits of a given option and the net benefits of the previous less

stringent option.

Source: U.S. EPA Analysis, 2004.

E3A-3 BREAK-EVEN ANALYSIS OF POTENTIAL NON-USE BENEFITS

EPA conducted a break-even analysis for each option to determine the per household value and per age-1

equivalent value of non-use benefits needed for total annual benefits to equal total annual costs. Table E3A-8

presents the results at the national level; Tables E3A-9 and E3A-10 present results at the regional level. For a

description of this analysis, see section E3-3 above.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-8

Table E3A-8: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Cost for Existing Phase III Facilities - Break-Even Analysis (2003$)

Option

Total Social

Costs

(millions)

Mean Value of

Use Benefits

(millions) 

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction in

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

3% Discount Rate

Option 3 $65.0 $2.0 $63.1 31,890,286 $1.98 53,171,000 $1.19

Option 4 $67.9 $2.0 $65.9 26,772,975 $2.46 52,261,000 $1.26

Option 2 $73.7 $2.0 $71.7 26,772,975 $2.68 52,261,000 $1.37

Option 1 $76.1 $2.1 $74.0 32,298,995 $2.29 54,361,000 $1.36

Option 6 $95.7 $2.1 $93.6 38,143,532 $2.45 56,161,000 $1.67

7% Discount Rate

Option 3 $69.6 $1.6 $68.0 31,890,286 $2.13 53,171,000 $1.28

Option 4 $73.9 $1.6 $72.3 26,772,975 $2.70 52,261,000 $1.38

Option 2 $79.3 $1.6 $77.7 26,772,975 $2.90 52,261,000 $1.49

Option 1 $81.8 $1.6 $80.1 32,298,995 $2.48 54,361,000 $1.47

Option 6 $102.5 $1.7 $100.8 38,143,532 $2.64 56,161,000 $1.79

a

 The non-use benefits category in this table may include some categories of use values that were not taken into account by the

recreation and commercial fishing analyses. b

 The non-use value per age-1 equivalent reported in the table includes the value placed on the fish’s contribution to non-use

ecological services (e.g., population, health, sustainability, and overall ecosystem health).

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-9

Table E3A-9: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis by Regions (2003$, discounted at 3%)

Option

Total Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

Option 3

California $1.1 $0.0d $1.1 1,518,773 $0.71 391,000 $2.76

North Atlantic $4.6 $0.1 $4.5 2,129,180 $2.11 930,000 $4.84

Mid-Atlantic $2.7 $0.5 $2.2 6,491,544 $0.34 13,400,000 $0.16

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$9.5 $0.7 $8.9 1,344,996 $6.59 8,650,000 $1.02

Great Lakes $20.6 $0.4 $20.2 7,076,410 $2.86 13,200,000 $1.53

Inland $25.2 $0.3 $24.8 13,329,383 $1.86 16,600,000 $1.50

National Total $65.0 $2.0 $63.1 31,890,286 $1.98 53,171,000 $1.19

Option 4

California $1.5 $0.1 $1.5 1,518,773 $0.98 771,000 $1.93

North Atlantic $4.6 $0.1 $4.5 2,129,180 $2.11 930,000 $4.84

Mid-Atlantic $3.3 $0.5 $2.8 6,491,544 $0.43 13,600,000 $0.20

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$14.5 $0.7 $13.8 1,344,996 $10.28 8,860,000 $1.56

Great Lakes $22.8 $0.4 $22.5 7,076,410 $3.17 13,300,000 $1.69

Inland $19.7 $0.3 $19.4 8,212,072 $2.36 14,800,000 $1.31

National Total $67.9 $2.0 $65.9 26,772,975 $2.46 52,261,000 $1.26

Option 2

California $1.5 $0.1 $1.5 1,518,773 $0.98 771,000 $1.93

North Atlantic $4.6 $0.1 $4.5 2,129,180 $2.11 930,000 $4.84

Mid-Atlantic $3.3 $0.5 $2.8 6,491,544 $0.43 13,600,000 $0.20

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$14.5 $0.7 $13.8 1,344,996 $10.28 8,860,000 $1.56

Great Lakes $22.8 $0.4 $22.5 7,076,410 $3.17 13,300,000 $1.69

Inland $25.2 $0.3 $24.9 8,212,072 $3.03 14,800,000 $1.68

National Total $73.7 $2.0 $71.7 26,772,975 $2.68 52,261,000 $1.37

Option 1

California $1.5 $0.1 $1.5 1,518,773 $0.98 771,000 $1.93
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

Table E3A-9: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis by Regions (2003$, discounted at 3%)

Option

Total Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

E3A-10

North Atlantic $4.6 $0.1 $4.5 2,129,180 $2.11 930,000 $4.84

Mid-Atlantic $3.3 $0.5 $2.8 6,491,544 $0.43 13,600,000 $0.20

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$14.5 $0.7 $13.8 1,344,996 $10.28 8,860,000 $1.56

Great Lakes $22.8 $0.4 $22.5 7,076,410 $3.17 13,300,000 $1.69

Inland $27.5 $0.3 $27.2 13,738,093 $1.98 16,900,000 $1.61

National Total $76.1 $2.1 $74.0 32,298,995 $2.29 54,361,000 $1.36

Option 6

California $2.2 $0.1 $2.2 1,518,773 $1.43 771,000 $2.82

North Atlantic $4.6 $0.1 $4.5 2,129,180 $2.11 930,000 $4.84

Mid-Atlantic $3.5 $0.5 $3.0 7,214,556 $0.41 13,700,000 $0.22

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$14.5 $0.7 $13.8 1,344,996 $10.28 8,860,000 $1.56

Great Lakes $28.6 $0.4 $28.2 9,055,971 $3.11 14,300,000 $1.97

Inland $40.0 $0.4 $39.6 16,880,055 $2.35 17,600,000 $2.25

National Total $95.7 $2.1 $93.6 38,143,532 $2.45 56,161,000 $1.67

a

 The non-use benefits category in this table may include some categories of use values that were not taken into account by the

recreation and commercial fishing analyses. b

 The non-use value per age-1 equivalent reported in the table includes the value placed on the fish’s contribution to non-use

ecological services (e.g., population, health, sustainability, and overall ecosystem health). c No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. d

 Positive non-zero value less than $50,000. 

Source: U.S. EPA Analysis, 2004.
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

E3A-11

Table E3A-10: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis by Regions (2003$, discounted at 7%)

Option

Total Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

Option 3

California $1.2 $0.0d $1.2 1,518,773 $0.79 391,000 $3.07

North Atlantic $5.0 $0.1 $5.0 2,129,180 $2.35 930,000 $5.37

Mid-Atlantic $2.6 $0.4 $2.2 6,491,544 $0.34 13,400,000 $0.16

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$10.7 $0.5 $10.1 1,344,996 $7.54 8,650,000 $1.17

Great Lakes $22.9 $0.3 $22.6 7,076,410 $3.19 13,200,000 $1.71

Inland $25.9 $0.3 $25.6 13,329,383 $1.92 16,600,000 $1.54

National Total $69.6 $1.6 $68.0 31,890,286 $2.13 53,171,000 $1.28

Option 4

California $1.6 $0.0d $1.6 1,518,773 $1.03 771,000 $2.03

North Atlantic $5.0 $0.1 $5.0 2,129,180 $2.35 930,000 $5.37

Mid-Atlantic $3.1 $0.4 $2.7 6,491,544 $0.42 13,600,000 $0.20

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$17.0 $0.5 $16.5 1,344,996 $12.25 8,860,000 $1.86

Great Lakes $25.0 $0.3 $24.7 7,076,410 $3.49 13,300,000 $1.86

Inland $20.6 $0.3 $20.4 8,212,072 $2.48 14,800,000 $1.38

National Total $73.9 $1.6 $72.3 26,772,975 $2.70 52,261,000 $1.38

Option 2

California $1.6 $0.0d $1.6 1,518,773 $1.03 771,000 $2.03

North Atlantic $5.0 $0.1 $5.0 2,129,180 $2.35 930,000 $5.37

Mid-Atlantic $3.1 $0.4 $2.7 6,491,544 $0.42 13,600,000 $0.20

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$17.0 $0.5 $16.5 1,344,996 $12.25 8,860,000 $1.86

Great Lakes $25.0 $0.3 $24.7 7,076,410 $3.49 13,300,000 $1.86

Inland $25.9 $0.3 $25.6 8,212,072 $3.12 14,800,000 $1.73

National Total $79.3 $1.6 $77.7 26,772,975 $2.90 52,261,000 $1.49

Option 1

California $1.6 $0.0d $1.6 1,518,773 $1.03 771,000 $2.03
§ 316(b) Proposed Rule: Phase III – EA, Part E: Social Costs, Benefits, and Benefit-Cost Analysis Appendix to Chapter E3

Table E3A-10: Estimated Value of Non-Use Benefits Required for Total Benefits to Equal Total Social

Costs for Existing Phase III Facilities - Break-Even Analysis by Regions (2003$, discounted at 7%)

Option

Total Social

Costs

(millions)

Mean Value

of Use

Benefits

(millions)

Non-Use

Benefits

Necessary to

Break Evena

(millions)

Number of

Households

Break-Even

WTP per

Household

($)

Reduction of

I&E Losses

(Age-1

Equivalents)

Break-Even

Value per

Age-1

Equivalentb

($)

E3A-12

North Atlantic $5.0 $0.1 $5.0 2,129,180 $2.35 930,000 $5.37

Mid-Atlantic $3.1 $0.4 $2.7 6,491,544 $0.42 13,600,000 $0.20

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$17.0 $0.5 $16.5 1,344,996 $12.25 8,860,000 $1.86

Great Lakes $25.0 $0.3 $24.7 7,076,410 $3.49 13,300,000 $1.86

Inland $28.3 $0.3 $28.0 13,738,093 $2.04 16,900,000 $1.66

National Total $81.8 $1.6 $80.1 32,298,995 $2.48 54,361,000 $1.47

Option 6

California $2.2 $0.0d $2.2 1,518,773 $1.45 771,000 $2.85

North Atlantic $5.0 $0.1 $5.0 2,129,180 $2.35 930,000 $5.37

Mid-Atlantic $3.3 $0.4 $2.9 7,214,556 $0.40 13,700,000 $0.21

South Atlanticc $0.0 $0.0 $0.0 0 $0.00 0 $0.00

Gulf of

Mexico

$17.0 $0.5 $16.5 1,344,996 $12.25 8,860,000 $1.86

Great Lakes $30.8 $0.3 $30.5 9,055,971 $3.37 14,300,000 $2.13

Inland $41.7 $0.3 $41.4 16,880,055 $2.45 17,600,000 $2.35

National Total $102.5 $1.7 $100.8 38,143,532 $2.64 56,161,000 $1.79

a

 The non-use benefits category in this table may include some categories of use values that were not taken into account by the

recreation and commercial fishing analyses. b

 The non-use value per age-1 equivalent reported in the table includes the value placed on the fish’s contribution to non-use

ecological services (e.g., population, health, sustainability, and overall ecosystem health). c No benefits or costs are expected in the South Atlantic region because all potentially regulated facilities in this region already meet

the national categorical requirements in the baseline and therefore would not be required to install technologies to comply with this

option. d

 Positive non-zero value less than $50,000.

Source: U.S. EPA Analysis, 2004.