Boiler MACT impacts

15 September 2010-- A new economic impact study by IHS Global Insight says a proposed boiler MACT rule from the U.S. Environmental Protection Agency could put more than 300,000 jobs at risk and impact the overall U.S. economy.

The study, released by the Council of Industrial Boiler Owners (CIBO), analyzed three different compliance scenarios that could result depending upon how EPA finalizes the rule for Industrial, Commercial, and Institutional (ICI) boilers and process heaters. Across all three scenarios, the study found that, for every $1 billion spent on upgrade and compliance costs, 16,000 jobs could be put at risk and the US gross domestic product reduced by as much as $1.2 billion.

The report also says that if the rule passes as proposed, it could put 338,000 jobs at risk at regulated facilities, their suppliers, and broader effects of the loss of direct and indirect spending. Of those jobs that could be at risk, almost half of those cuts could be avoided if EPA were to use a health-based approach for regulating inorganic hazardous air pollutant emissions, which would result in almost the same environmental benefit.

EPA has proposed to use a work practice standard for natural gas-fired units, but if EPA instead decides to apply technology-based emissions limits as discussed in the proposed rule, an additional 798,000 jobs could be put at risk.

While some larger entities will be able to absorb the costs of the rule with minimal changes to employment levels, they would pass on the costs to their customers. The largest impact would be on smaller or less profitable firms, which could be forced to make the largest staff reductions or even shut down.

EPA's proposed boiler MACT rule would impose new regulations and new monitoring requirements for 11 subcategories of boilers and process heaters based on fuel type and unit design, with the intention of substantially reducing hazardous air pollutant emissions from those units. In many cases, these new standards would require the installation of expensive control technologies without sufficient assurance that proposed emission limits would routinely be achieved.

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