I also would like to extend a warm welcome to Mayor Tom Nye of Hamilton, Ohio. Hamilton is a great city and is the seat of Butler County in southwestern Ohio. It has made great use of the Ohio River to help address their electrical needs, while decreasing its reliance on coal-generated power.
While I was Governor of Ohio, I became concerned that the EPA was not taking into consideration costs, benefits and sound science during their rulemaking process.
I was particularly concerned about their ozone and particulate standards and the NOx SIP call. In fact, I spent over 100 hours on trying to convince EPA, the Clinton Administration, members of Congress and members of this committee that the costs of the new standards to this country far outweighed the benefits to public health and the environment.
In fact, according to EPA's own estimates, the costs for implementing the NAAQS standard for ozone exceeded the benefits. The President's own Council of Economic Advisors predicted that the benefits would be small while the costs of reaching full attainment could total $60 billion.
I also do not believe the Administration knew enough about the science behind these rules to finalize them. In the case of PM-2.5, after the rule was finalized, the Administration has consistently returned to Congress to ask for funding to research the effects of PM-2.5. They should have done the scientific research before issuing the rule.
I'd like to note that at the time, Senator Inhofe provided significant help to states by amending TEA-21 to help provide more reasonable timelines to implement ozone and particulate matter requirements.
Just last month a U.S. appeals court remanded EPA's ozone and PM-2.5 standards, ruling that EPA did not justify its decision with sound scientific evidence. Ohio was a party to this lawsuit, which began when I was Governor.
The court didn't say that EPA couldn't regulate at these levels, but that EPA didn't give justification for doing so.
That has been my point all along. I have argued that the NAAQS standards and NOx SIP call were going to be costly to implement and that the investments to achieve them could not be supported by sound science.
Shortly after the NAAQS decision, the same appeals court granted a state petition to stay the NOX SIP call until it decided on the lawsuit by Ohio and other states.
I believe one of the most obvious examples of U.S. EPA's lack of regard for reasonable approaches was witnessed by Midwest states during the Ozone Transport Assessment Group (OTAG) process and announcement of the final rules for the NOX SIP call.
OTAG was a partnership between 37 states, including Ohio environmental groups and various industry. It recommended NOx reductions in amounts up to 85 percent along with completion of subregional modeling. Ohio concurred with this recommendation.
However, U.S. EPA chose to impose an across-the-board, uniform 85 percent reduction despite data demonstrating little or no impact from the many states in OTAG.
In essence, U.S. EPA simply chose the level of pollution control it wanted utilities to achieve and implemented it without regard to air quality impact.
The Midwest and Southern Governors proposed an alternative NOx strategy that made much more sense for meeting the new eight-hour ozone standard than the final rule.
It required a good faith down payment of 65 percent reductions.
In 2001, states would analyze whether additional controls were necessary to meet the 8-hour ozone standard by 2009 a full year earlier than permitted under U.S. EPA's approach.
If additional controls were necessary, they would have been implemented. However, if the 65 percent reductions met the standard, then additional very expensive controls would not be necessary.
Governors thought this was a good and fair proposal that would have achieved attainment of the eight-hour ozone standard which the court has now ruled isn't even enforceable.
But EPA ignored this reasonable proposal and finalized the most stringent controls possible for NOX in 2003. The final rule also sets up a system to wait until 2007 to determine whether this strategy worked.
Ironically, U.S. EPA's final NOX rule sets up the possibility that attainment of the eight-hour ozone standard will actually be achieved a year later (2010) than the Governors' alternative to achieve the standard in 2009.
How could EPA justify going against experts in the states? How is human health and the environment protected under a model that would achieve the standards a year later than the Governors' proposal?
I think this is just another example of EPA being arbitrary and capricious. Instead of trying to work with reasonable people who care about the environment, they went ahead and said it had to be done their way. I strongly believe that if EPA worked with states, then lawsuits like the ones involving the NOx SIP call and the NAAQS standards could have been averted.
Now it is in the court's hands to determine the validity of the NOx SIP call, but I think the underlying question is what is going to happen with the Section 126 petitions. Despite pending litigation, it seems to me that utilities and states are planning to move forward with reasonable NOx reductions. I think the message to EPA is that they should work with the states involved with this issue and move on.
Thank you Mr. Chairman, I look forward to today's testimony.
I am Christopher Jones, director of the Ohio Environmental Protection Agency. I want to thank Senator Inhofe and the committee for holding this hearing, and for inviting Ohio's testimony.
As you may know, Ohio is one of eight states which appealed the NOx SIP call. One of our primary reasons for doing so is that we believe the 85% reduction in utility emissions required in the rule is neither within U.S. EPA's authority to mandate nor justified by scientific data.
The Clean Air Act gives U.S. EPA the authority to establish national ambient air quality standards, but it reserves for the states the authority to develop their own control strategies that will achieve the standards. For U.S. EPA to effectively mandate in the SIP call the specific sources that must be controlled and the degree to which they must be controlled is a clear infringement on the States' rights. This is particularly egregious because the NOx SIP call is not based on sound science. In fact, it largely ignores the work of the Ozone Transport Assessment Group - OTAG.
In 1996, thirty-seven states in the eastern United States formed OTAG to analyze persistent ozone problems east of the Mississippi River. After two years of study, including extensive modeling, OTAG presented a series of findings and recommendations to U.S. EPA. Some of the more pertinent findings include:
1. Regional NOx controls are effective in producing ozone benefits.
2. Ozone benefits diminish with distance, particularly at distances over 150 miles.
3. The following NOx controls would be effective in reducing ozone:
A. Utility emissions controls between those required under Title IV of the Clean Air Act controls and 85%;
B. Large non-utility controls between 55% and 70%;
C. Reasonably available control technology for mid-sized sources;
D. States should have a choice of regulatory systems whether it be using emission rates or a statewide emissions budget; and
E. States should have the ability to conduct regional modeling to determine the level of control needed to meet air quality standards. After these recommendations were presented to U.S. EPA, the federal agency proposed the NOx SIP Call, requiring that twenty-two states develop State Implementation Plans to reduce utility emissions by 85% in the year 2002. The one-size-fits-all 85% requirement ignores OTAG's finding that ozone reduction benefits diminish with distance, as well as the recommendation for regional modeling to determine effective control levels. Rather, the SIP Call mandates the most stringent level of control for every state, instead of considering other options that might prove equally effective.
Ohio, West Virginia, Michigan, Virginia, South Carolina, Indiana, lilinois, Kentucky, Tennessee, and Alabama initiated a series of meetings to develop an alternative plan to reduce NOx emissions. In June of 1998, six states known as the MidwesVSoutheast Governors' Ozone Coalition submitted a plan that contained these main elements:
1. A Phase I early reduction program, with utilities achieving a 55% reduction by 2002 and a 65% reduction by 2004.
2. A Phase II plan to aggressively pursue attainment of the eight-hour ozone standard, which includes:
A. Complete "first look" modeling completed by July 2001;
B. Submission of a final plan by July 2003;
C. Additional controls installed by April 2007; and
D. Attainment of the eight-hour standard by October 2009.
In submitting the plan, we put forward a rational approach to more than adequately address long-range transport, provide a substantial down payment on the eight-hour standard, and determine whether additional reductions of nitrogen oxides or volatile organic compounds are needed to meet the new air quality standards.
U.S. EPA rejected this common-sense approach and, in the fall of 1998, U.S. EPA adopted its final rules virtually unchanged except for providing an additional six months for utilities to comply, until Spring of 2003. The rule required State Implementation Plans to be submitted to U.S. EPA by September 30, 1999.
Ohio had no choice but to appeal. The deadline itself precluded virtually any response but rote agreement with U.S. EPA's approach, and the rule is more burdensome than the Governors' plan without being more protective. On May 25,1999, the Court issued a stay of the requirement to submit a SIP and will hear oral arguments on our appeal on November 9, 1999.
Because the implementation of the NOx SIP call has been stayed by the U.S. District Court of Appeals, Administrator Browner has announced her intent to require essentially the same NOx reductions in 12 states through rulemaking under Section 126 of the Clean Air Act. Ohio does not believe that U.S. EPA in fact has the authority to take this action. U.S. EPA's interpretation of Section 126 is that there is a " typographical error," and that the what the law says is not what Congress intended it to mean. Ultimately, only Congress can clarify whether the law reflects its intentions, but in the meantime, Ohio will argue that it must be administered as it stands.