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MEMORANDUM

TO: Gil Wood, USEPA

David Cole, USEPA

FROM: Jill Mozier, EC/R Inc.

DATE: September 18, 2013

SUBJECT: Notes from OMB – Alliance for Green Heat Conference Call on 9/16/2013 

regarding Wood Heater NSPS Proposal

The Office of Management and Budget (OMB), the Small Business Administration (SBA), the 

Council on Environmental Quality (CEQ), and EPA were on the call. Primary speakers were 

Tom Morrissey, President of Woodstock Soapstone in New Hampshire, John Ackerly of The 

Alliance for Green Heat, and Britt Fleming, counsel to The Alliance for Green Heat.

Tom Morrissey comments:

 Here in support of the rule representing a very small (“micro”) business of 30 employees. 

Noted that because Soapstone is so small it represents the most vulnerable segment of the 

manufacturers impacted by the NSPS, and further noted several times how transparent 

EPA/Gil has been with development of proposed rule.

 Speaking as a small business, the emission limits being considered are “eminently

possible”. Soapstone already has 3 stoves in neighborhood of 1.3 g/hr already and a 4th

stove that should be ready in November to be certified at 1 or 0.9 g/hr, and be cheaper, 

too.

 Soapstone’s R&D plus certification cost for new stove = ~$200,000. Tom has heard some 

industry estimates at twice this amount and noted he could see spending ~$400,000 for 

very first model but after that the manufacturers tend to copy an existing model, so the 

costs shouldn’t be that high. In response to question from OMB about whether the 

$200,000 is representative of the industry as a whole, Tom said yes and furthermore that 

he has seen some higher industry estimates and some are “almost unbelievable”.

 Soapstone supports NSPS also because the public health benefits way exceed the cost to 

us, as manufacturers. Our industry can ruin air quality for entire community. The 

regulations Tom’s seen are well done, thoughtful, and bring in sources that have not been 

regulated before.
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 This set of regulations in the best possible thing that could happen to our industry 

because we need to be able to say our products are clean, efficient and non-polluting 

while passing the “giggle test”.

 In response to question from OMB about lessons learned during last go-round, Tom 

responded the primary lesson is to not wait until the end. His company has been 

diligently working for 5 or 6 years to develop better stoves [i.e., those noted above]. This 

can’t be done last minute, but a 2 to 5-year window is adequate. All progress is iterative 

and 2 or even 3 design cycles are possible within 5 year window.

 In response to question from OMB about how the company budgets, Tom responded that 

while there are fixed costs at the end for EPA and UL testing, in the beginning the cost is 

all man-hours, as even the material is inexpensive (~$1.20/lb of steel). In response to 

question as to whether costs come out of additional operating expenses rather than capital 

expenditures, Tom explained that as a C-corp he has retained earnings and a line of 

credit. So this line of credit can be used for development. The company budgets 4-5% 

every year for R&D plus can easily get equipment loans through hometown banks, as 

money is so cheap currently. So it’s a mix of retained earnings, line of credit, equipment 

loans, and eager employees.

John Ackerly (Alliance for Green Heat) comments:

 The Alliance for Green Heat is very supportive of most of the regulations although the 

Alliance would like the rule to be stricter in a few key places. More people in the US use 

wood than use oil and propane and, in the 2000 to 2010 time frame, wood heating has 

grown the fastest. The US needs cleaner models as Europe is trouncing the US in this 

regard, since the US hasn’t kept up.

 The Alliance wants to see the regulations in place ASAP, and thinks efficiency is very

important. The proposed 4.5 g/hr standard is too easy and doesn’t raise the bar at all. In 

particular, the standard needs to be tighter for pellet stoves as the average pellet stoves is 

at 2.5 g/hr and a 1g/hr difference is important, especially in urban areas where pellet 

stoves can be used. There is no reason for the 4.5 g/hr standard – this is backsliding and 

will allow Chinese units to swamp the market.

 The 5-year timing is reasonable except for hydronic heaters where the standard needs to 

get stricter sooner. HH give wood burning a bad name – it’s a pernicious technology that 

should have been disallowed. A 2-year time frame, rather than a 5-year period, is needed 

for HH. Small businesses should not be protected if their product is dirty.

 The Alliance agrees with T. Morrissey and is impressed with how transparent EPA has 

been. But there should be a minimum efficiency standard. Disclosure is needed at least, 

but a minimum efficiency standard is good because efficiency is a proxy for CO; a 

minimum efficiency is not a huge challenge to manufacturers; and yet it will give some 

assurance to consumers.
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 The Alliance would like the green label effort mentioned in the Preamble. Since there is 

no energy star rating, it’s at least worth mentioning the green label effort to show EPA 

supports it.

 There is an increasing number of ways to produce clean stoves affordably (e.g., oxygen 

sensors/monitors). The Alliance invites OMB rep to visit the wood stove challenge on the 

lawn in DC in November.

 Britt Fleming noted that although EPA is likely not including efficiency in the regulation, 

it should at least be mentioned in the Preamble as an option/alternative EPA is taking 

comment on. (Tom Morrissey agreed that publishing efficiencies are absolutely essential 

for consumer comparison.) Britt noted that EPA should also take comments on tighter 

standards than are in the reg text. The Alliance would like to keep as many options open 

as possible in the rulemaking package – that is, keep logic in the Preamble for a different 

pathway. These products last a very long time, so it’s critical we get low emitting units 

that are also efficient as soon as possible.