Document ID: EPA-HQ-OAR-2007-0225-0026
Agency: epa
Document Type: Supporting & Related Material
Title: 
Posted Date: 2007-08-02T04:00Z

We asked that EPA present a list of controls in the main text of the
report instead of the appendix.  Doing so would make the exposition
easier to follow.  We believe it is in EPA’s interest to make their
RIA as easy to understand as possible.

EPA should also clarify in the text how they are using OIRA recommended
interest rates. 

On extrapolated costs:  Regardless of where the economic impact
assessment is, it needs to incorporate whatever assessments of
extrapolated costs that EPA has estimated.  It is not appropriate to
separate out extrapolated costs from other costs in the analysis.  We
look forward to seeing the new version of this analysis before the rule
goes public.

On the size of the impact being small:  The estimated costs of the rule,
depending on what estimate you are looking at, is $7 billion. 
Economically significant rules are those whose economic effect is $100
million or more.  The impact of this rule is 70 times that threshold. 
It is one of the most expensive rules being considered this year.  The
costs should not be characterized as small.  

EPA did not address the question, “what are the total compliance costs
of this rule compared to the similar analysis done on the PM NAAQS?” 
Please include this comparison in the text to allow the compliance cost
of the present rule to be put in its proper context.

On the EMPAX model:  Sensitivity analysis should show to what extent the
competitiveness results of the model run are driven by assumptions about
Armington and supply elasticities.  Rather than making a qualitative
statement about the relative conservative assumptions of the model, it
would be more informative for EPA to show how the results change in
response to changing key assumptions.

On location issues:  EPA states that environmental regulations are not
important factors in location decisions.  Does EPA have empirical
studies that support this statement?  If not, EPA needs to run
sensitivity analysis to reflect how their assumptions of supply
elasticities drive the results of the model.

Technological advance:  Despite philosophical objections, it would be
useful to run a model that assumes no technological advance to serve as
a worst case compliance cost scenario.  It will help put in context the
additional runs done for sensitivity analysis.

On the marginal cost econometric estimations:  DOC looks forward to
receiving the data and a description of their econometric method from
EPA.

Other DOC Comments:  We received no responses to the following comments:

Appendix 3, 3.2 Mobile Controls/Rules used in baseline and control
scenarios: 

3.3[SIC].2 Implement Continuous Inspection and Maintenance Using Remote
Onboard Diagnostics (OBD)

Comment: The prior section limited consideration to Class 6 and above
trucks.  For clarity, some note should made early in the first paragraph
of this section that light vehicles are the expected target of OBD for
this analysis.

3.2.4 Commuter Programs

We used the findings from a recent Best Workplaces for Commuters survey,
which was an EPA sponsored employee trip reduction program, to estimate
the potential emissions reductions from this measure.   The BWC survey
found that, on average, employees at workplaces with comprehensive
commuter programs emit 15% fewer emissions than employees at workplaces
that do not offer a comprehensive commuter program.  

Question:  Is it appropriate to assume that these results will carry
over to a larger universe of participants?  Is current participation in
BWC programs self-selected for highest possible results?  The take-up
rate should necessarily be lower as organizations become smaller and
populations become more dispersed since time costs of travel increase
and opportunities for pooling decrease. The study found that benefits
packages that don’t include financial incentives reduce emissions
about 7%.

We believe that getting 10-25% of the workforce involved in commuter
programs is realistic.

Question:  What criteria were used to determine the likelihood of
workforce involvement?

Appendix 5, 5.3 Cost information for Onroad and Nonroad Mobile Sources:

Eliminating Long Duration Truck Idling, TSE

Since TSE technology can completely eliminate long duration idling at
truck spaces (i.e. a 100% fuel savings), this translates into 2,920
gallons of fuel saved per year per space. At current diesel prices
($2.90/gallon), this fuel savings translates into $8,468.

Comment:  While TSE technology can greatly improve efficiency, it does
not eliminate fuel consumption.  The electricity used to provide power
has fuel requirements and some associated emissions. 

Commuter Programs

We chose to apply the resulting average cost-effectiveness estimate to
one pollutant – NOx – in order to be able to compare commuter
reduction programs to other Nox reduction strategies. TRB reported the
cost-effectiveness of each measure, however, as a $/ton reduction of
both VOC and Nox by applying the total cost of the program to a 1:4
weighted sum of VOC and Nox [[total emissions reduction = (VOC * 1) +
(Nox * 4)).  There was not enough information in the TRB study to
isolate the $/ton cost-effectiveness for just Nox reductions, so we used
the combined Nox and VOC estimate.

Question:  Wouldn’t any calculation that reduces the result
necessarily make the results more accurate (such as dividing the result
in half or subtracting by the weighted value of VOC)?  Since the
cost-effectiveness could not be isolated, the cost-effectiveness of
controlling VOC could have contributed anywhere from 1 to 99 percent of
the reported result.  The combined estimate is the only one likely to be
biased.  TRB would have made no mention of VOC or reported it as such if
the results of any portion were 100% due to the cost-effectiveness of
controlling NOx.