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4.1. Carbon Monoxide RIA

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The Regulatory Economic Analyses Inventory database contains three documents pertaining to carbon monoxide: a draft RIA from 1982, a cost and economic impact analysis from 1985, and a final RIA from 1985. The final 1985 RIA is reviewed here.

The Clean Air Act calls on EPA to set primary national ambient air quality standards (NAAQS) for criteria air pollutants to protect human health with an adequate margin of safety. Carbon monoxide (CO) is one of six criteria air pollutants. Secondary standards, based on benefit and cost considerations may be set to protect public welfare. The CAA requires that EPA review primary ambient air quality standards at five year intervals.

As part of the review of the CO standard in 1985, EPA issued an RIA on carbon monoxide in response to the requirements of Executive Order 12291. Prior to the 1985 review, the primary and secondary standards for CO were identical at 10 mg/m3 (9ppm) over an 8 hour averaging period, and an average of 40 mg/m3 over a one hour period, with neither standard to be exceeded more than once per year.

Carbon monoxide is a colorless, odorless gas that is toxic due to its affinity with blood hemoglobin. The formation of carboxyhemoglobin (COHb) reduces the ability of the blood to supply oxygen to cells, causing adverse effects on the cardiovascular, pulmonary, central nervous and other systems. CO exposure that results in 2.9 to 4.5 percent COHb can aggravate cardiovascular disease by reducing the time to onset of angina pain and increasing the duration of pain. In its review of the scientific evidence, EPA's Clean Air Scientific Advisory Committee (CASAC) concluded that critical effects begin at approximately 3 percent COHb. Effects on vegetation are not noticed until plants are exposed to at least 100 ppm CO for several days. Since no parts of the nation experience CO concentrations that approach this level, the Regulatory Impact Analysis focused on health effects that could be expected under the primary standard.

In the 1985 RIA, EPA considered several alternatives: (1) revoking the primary and secondary CO standards and relying on liability law and private negotiations to determine CO levels; (2) other regulatory approaches such as performance standards for mobile sources; (3) market-based instruments such as charges and tradable permits; and (4) changing the level of the standard, the averaging time, or the expected number of excedances. EPA rejected the first alternative as unlikely to provide for the optimum control of CO due to the high transactions costs of liability and private negotiations. The second alternative was characterized as a useful adjunct to ambient standards but not a substitute, as it could lead to excessive levels of CO in some areas. Market-based approaches were characterized as useful tools for achieving the NAAQS but not a substitute for the NAAQS. The primary focus of the RIA concerned possible changes in the existing standard.

EPA considered four different levels for the CO NAAQS: the then-existing 9 ppm averaged over 8 hours with one observed exceedance; alternative "A" of 9 ppm averaged over 8 hours with one expected exceedance; alternative "B" of 12 ppm averaged over 8 hours with one expected exceedance; and alternative "C" of 15 ppm averaged over 8 hours with one expected exceedance.

Cost analysis:

The cost analysis for the RIA was derived from a companion EPA report: Costs and Economic Assessment of National Ambient Air Quality Standards for Carbon Monoxide (Revised), USEPA, Office of Air Quality Planning and Standards (EPA-450/5-85-006). Alternative CO standards have implications for the attainment measures that must be adopted, which could include changes in vehicle inspection and maintenance programs, traffic control initiatives such as synchronized stop lights, and oxygenated fuels. Cost estimates depend heavily on the required changes in air quality and projected population growth.

Adopting reasonably available control measures (RACM) which include basic inspection and maintenance, traffic controls and point source controls would result in annualized national costs of $4.74 billion for the current standard, $4.68 billion for alternative "A," $4.51 for alternative "B," and $4.48 for alternative "C." Total annualized costs vary little because vehicle emission control costs of $4.43 billion are included in alternative. With RACM some areas would fail to attain the CO NAAQS. These areas would have to implement additional "best available control measures" (BACM). Among BACM options are more stringent vehicle inspection and maintenance (I&M), making I&M as effective in cold weather as it is in warm weather, and reducing stationary source contributions so that background levels are zero rather than 1 ppm. Annualized BACM costs were approximately $300 million for the current standard, $200 million for alternative "A," $100 million for alternative "B," and $50 million for alternative "C."

Benefit analysis:

EPA did not attempt to monetize benefits. In 1985, there were no credible estimates of the value of the health endpoints avoided. The RIA included a summary of the mechanisms through which CO produces adverse health effects, the nature of the adverse health effects and at what exposure levels these effects may be expected, the groups at greatest risk, and the number of adverse effects expected at different levels of the CO NAAQS. EPA's review of the scientific evidence suggested that at blood levels above 2.9 percent COHb there is a decrease in exercise capacity and an increase in incidence of chest pain among patients with heart disease. The populations at greatest risk from CO exposures include about 8.7 million people with a history of heart disease, those with chronic respiratory disease, the elderly, those with anemia and fetuses and infants. Certain individuals taking medication, especially when coupled with alcohol, and others visiting high altitudes could also be at risk. EPA's analysis predicted that with the current standard no individuals would experience blood COHb levels in excess of 2.1 percent; however, weakening the standard would result in thousands to millions of such elevated readings.

Economic analysis:

In comparing the benefits and costs, EPA determined that the incremental cost of attaining the current standard would have an incremental cost of between $8,000 and $14,500 per person who otherwise would have had an occurrence of 2.1 percent or greater COHb. Whether people would be willing to pay this amount to avoid COHb of this amount was not established, though it was clear that at higher levels of COHb there would be a willingness to pay of an undetermined amount.

Proposed action:

EPA recommended retaining the current standard in view of the many unquantified benefits (to fetuses and others), the fact that susceptibility to CO varies considerably among different subgroups, and the directive of the Clean Air Act to protect against adverse health effects with an adequate margin of safety in setting primary NAAQS.

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