 

ASSESSMENT OF THE POTENTIAL COSTS, BENEFITS, AND OTHER IMPACTS

of the 

PROPOSED WITHDRAWAL

 of the	

EXPANSION OF THE RCRA COMPARABLE FUEL EXCLUSION-FINAL RULE

Economics and Risk Analysis Staff 

Office of Resource Conservation and Recovery

U. S. Environmental Protection Agency

1200 Pennsylvania Ave., N. W.

Washington, DC  20460

July 15, 2009

V4BACKGROUND

Regulatory Background

The comparable fuels exclusion (CFE) final rule was promulgated in 1998.
 This rule excluded from the regulatory definition of hazardous waste
fuel-grade hazardous secondary materials with specifications comparable
to fossil fuels.  The exclusion could be applied to liquid hazardous
secondary materials, but not to solids or used oils.  Following
promulgation, several members of the regulated community expressed
concern about constraints in the rule that prevented beneficial fuel use
for much of the potentially eligible hazardous secondary materials.  The
Office of Management and Budget (OMB), in their 2005 report on
regulatory reform, recommended that EPA remove these constraints to
achieve the full potential of the exclusion. Following additional data
collection, review, and assessment, the Agency promulgated the
emission-comparable fuel final rule (ECF final rule) in December 2008. 
This rule expanded the CFE to include hazardous secondary materials
which, when burned in industrial boilers meeting certain conditions,
would generate emissions comparable to those from burning fuel oil.  The
Agency is now proposing to withdraw the ECF final rule.

Analytical Background

The Agency published an economic assessment in support of the ECF final
rule.  Under the assumption that all 50 states would adopt the rule,
this assessment estimated net social benefits (cost savings) of $13.4
million per year, with an estimated 118,500 tons/year of ECF excluded. 
Our primary data source at the time of this analysis does not identify a
management method code for wastes that are combusted in an incinerator
and where that waste may have a heating value that is used beneficially
in lieu of fossil or other fuels. As a result, we assumed that ECF
burned in a hazardous waste incinerator is burned for destruction only
(no energy value derived from the material), as reported by these
facilities to EPA’s Biennial Reporting System under H040.  

Upon further consideration, the Agency has determined that material
qualifying as ECF but reported under hazardous waste management code
H040 is likely to provide some level of heating value to incinerators. 
As a result, we developed a revised economic assessment that accounted
for H040 heating value to incinerators.  This revised assessment
estimated benefits (cost savings) of $6.6 million per year with up to
117,100 tons of ECF excluded per year.  This document was developed as a
supplementary assessment to the May 14, 2008 Assessment and should not
be considered as the economic assessment in support of this proposed
withdrawal of the ECF Final Rule.  

PURPOSE

The purpose of this document is to present estimated impacts associated
with the proposed withdrawal of the December 19, 2008 ECF final rule. 
Estimated impacts include costs, benefits, small entity, and other
impacts.  Impacts presented in this paper are based on findings
contained in the July 15, 2009 revised assessment document.   

BASELINE CHARACTERIZATION

Proper baseline characterization is critical for the accurate assessment
of impacts associated with any regulatory action.  The proper baseline
for this proposed action should reflect the level of ECF final rule
implementation from the date of this rule to the date of full and final
implementation of the ECF rule.  Full implementation of the ECF final
rule was expected to occur over several months, if not years for those
states and facilities projected to adopt the rule. 

METHODOLOGY AND FINDINGS

The proposed withdrawal of the ECF final rule seeks to reverse the newly
promulgated exclusions to selected rules implementing subtitle C of the
Resource Conservation and Recovery Act (RCRA).  These exclusions are for
energy-rich secondary materials which would otherwise be hazardous
wastes.  However, when burned under specified conditions, these ECF
materials can be used for energy recovery in non hazardous boilers and
would have emissions comparable to emissions from industrial boilers
burning fuel oil. This document assesses the estimated impacts of the
proposed withdrawal based on a reversal of the benefits, as revised, for
the ECF final rule. 

Based on our revised assessment for the ECF final rule, we find that
this proposed withdrawal could result in annual lost benefits (costs) to
society of as much as $6.6 million dollars per year, with up to 117,100
tons/year of ECF moving back under full RCRA Subtitle C jurisdiction. 
However, due to baseline uncertainty, the actual impact of the proposed
withdrawal could range from negligible to $6.6 million, with anywhere
from negligible to 117,100 tons/year of material diverted away from ECF.
 The low end of the range assumes little or no implementation at the
point of proposal.  Actual impacts of this proposed action are likely to
fall very near the low end of the range due to the anticipated slow
implementation of the ECF final rule.   

The proposed withdrawal is expected to result in no discernable impacts
to human health and the environment.

SMALL ENTITY IMPACTS

The May 14, 2008 economic assessment identified 34 facilities projected
to take advantage of the ECF final rule (see Appendix E).  Based on the
corporate ownership of these facilities, one is confirmed as a small
business based on the Small Business Administration size standards.  The
size category of one other facility is undetermined.  All other
facilities are owned by large businesses or the federal government
(e.g., DOE).  For the one identified small business and the one of
undetermined size, impacts to these companies could be up to a maximum
one percent of gross annual revenues.  This impact estimate is based on
the average annual gross revenues for the NAICS category (2002 Census
data) and the average cost savings per generator, as reported in Exhibit
15 of the revised assessment.  This impact finding assumes both “small
businesses” have fully implemented the ECF final rule and would
experience cost increases as a result of this withdrawal. However, as
discussed above, we anticipate that, as of the projected date of this
proposed withdrawal, few if any facilities are likely to have fully
implemented the exclusion.  As a result, actual impacts to the
identified entities are likely to be negligible.  

EQUITY CONSIDERATIONS AND OTHER IMPACTS:

Regulatory Planning and Review: Under Executive Order 12866 [58 FR 51735
(October 4, 1993)], the Agency, in conjunction with the Office of
Management and Budget (OMB) Office of Information and Regulatory Affairs
(OIRA), must determine whether a regulatory action is “significant”
and therefore subject to OMB review and the full requirements of the
Executive Order. Pursuant to the terms of the Order, this proposal is
not an economically significant action.  However, this proposal is
procedurally significant because it raises novel legal or policy issues
arising out of legal mandates, the President’s priorities, or the
principles set forth in the Executive Order. As such, this document was
submitted to OMB for review.  Changes made in response to OMB
suggestions or recommendations are documented in the public record. 

The proposed withdrawal of this action is expected to have no
discernable impacts in regard to the following considerations:

Executive Order 12898, “Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations”

Executive Order 13045:  “Protection of Children from Environmental
Health Risks and Safety Risks”

Executive Order 13175: “Consultation and Coordination with Indian
Tribal Governments”

Executive Order 13132, “Federalism”

Executive Order 12630, “Government Actions and Interference with
Constitutionally Protected Property Rights”

Executive Order 13211, “Actions Concerning Regulations that Affect
Energy Supply, Distribution, or Use”

Executive Order 12988, “Civil Justice Reform” 

Executive Order 13352, “Facilitation of Cooperative Conservation” 

 

The Unfunded Mandates Reform Act (UMRA),	

 Office of Management and Budget (OMB), Office of Information and
Regulatory Affairs (OIRA), Regulatory Reform of the U.S. Manufacturing
Sector – 2005

 Expansion of RCRA Comparable Fuel Exclusion-Final Rule, December 19,
2008 (effective January 20, 2009).

 U.S. EPA, Assessment of the Potential Costs, Benefits, and Other
Impacts of the Expansion of the RCRA Comparable Fuel Exclusion—Final
Rule, May 14, 2008.

 USEPA, “2005 National Biennial Report” 

 U.S. EPA, 2005 Hazardous Waste Report Instructions and Forms, EPA Form
8700-13 A/B, October 2005.

 U.S. EPA, Revised Assessment of the Potential Costs, Benefits, and
Other Impacts of the Expansion of the RCRA Comparable Fuel
Exclusion-Final Rule, July 15, 2009

 The revised assessment also conducted a sensitivity analysis assuming
an alternative average Btu level derived from ECF burned in
incinerators.  This sensitivity analysis indicated total ECF final rule
benefits of approximately $10.6 million per year. 

 http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_t
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