The hearing will come to order. Good morning and thank you for coming.
Today’s hearing is the first in Congress on the Environmental Protection Agency’s proposed revisions to the particulate matter air quality standards. We are focusing on what EPA proposed and what it means for the nation. Next Wednesday, I have asked Chairman Inhofe to hold a second hearing at the full committee level – instead of in this subcommittee – on the science and risk assessment behind the Agency’s proposed revisions.
This is a very important issue with broad ranging impacts. It is at the core of what I have focused on in this Committee, the Senate, and throughout my career – we must harmonize our energy, environment, and economic needs.
Before discussing EPA’s proposal, it is very important that we put this hearing into context. First, our air is getting significantly cleaner. [CHART 1] Since 1970 – while our Gross Domestic Product, vehicle miles traveled, energy consumption, and population have increased substantially – emissions of the main pollutants of concern have been reduced by 54 percent.
Second, our nation’s high energy prices are having a devastating impact across the U.S. We have the highest natural gas prices in the world impacting families who depend on it to heat their homes and businesses that use it to make their products. The U.S. has lost more than 3.1 million and my State of Ohio has lost nearly 200,000 manufacturing jobs since 2000, due in large part to high natural gas prices.
Third, EPA has designated 495 counties across the nation – 38 in Ohio – as in nonattainment for the existing particulate matter and ozone air quality standards. States are working now to develop implementation plans to comply with these standards. As a former Governor who brought Ohio’s counties into attainment, I know firsthand that this is an extremely complicated and resource intensive task. This Subcommittee has examined the great challenge associated with implementing these standards with hearings that I held in April 2004 and November 2005.
But, here we go again! EPA has proposed to move the goalposts on state and local communities in the middle of this process by changing the particulate matter standards. I am going to focus not on coarse, but fine particulate matter – where EPA proposed to reduce the daily standard from 65 micrograms per cubic meter to 35 and to retain the annual standard at 15.
[CHART 2] Under EPA’s current standard, there are a total of 208 nonattainment counties. EPA’s proposed revision could increase the number of nonattainment counties to 530. Some groups are advocating for a more stringent standard, and EPA is considering lowering the annual standard to 14. [CHART 3] This map shows the 631 counties that could be in nonattainment under such a revision.
EPA claims that federal clean air rules such as the Clean Air Interstate Rule and new diesel fuel and engine regulations will bring most of the counties into attainment without local effort. This is exactly what EPA told us with the current standards, but we have seen that this simply ignores reality.
While federal rules will help areas, I am concerned that EPA is trivializing the impact of being designated nonattainment in the first place. Let me quote from Cincinnati Chamber of Commerce President Michael Fisher at our 2004 hearing: “Simply stated, conducting business in an area designated as non-attainment is more complicated, more time-consuming, and more costly.”
Additionally, a nonattainment designation threatens highway funding and jobs because businesses will not expand or locate in such an area. It can also lead to higher energy costs because coal fired power plants are a source of particulate matter. These emissions can be reduced by installing control equipment or switching to natural gas – ultimately leading to higher electricity and natural gas prices.
Furthermore, federal clean air rules will play only a small role in the designation of nonattainment areas and in helping communities meet the standards. [CHART 4] As you can see, EPA is planning on designating areas before 2010 when the first phase of reductions will be achieved under these rules. The Agency has also announced that the attainment deadlines will be before 2015 when the second phase of reductions will take place.
This is very frustrating, but the truth is that we do not know what impact revising the standards will have on the country – and neither does EPA. The Agency has released a draft Regulatory Impact Assessment (RIA) that only looks at five cities. I will insert into the record comments from several industries that because of the uncertainty project the cost of EPA’s proposal to be as low as $20 billion and as much as $60 billion per year incremental cost – which would be the most expensive federal regulation in the history of the Office of Management and Budget.
EPA says that we should ignore this analysis because they will release a completely different one with the final decision. I am astounded that EPA is working on this major rule behind closed doors, and we will not know what the impact will be until the final decision is released.
I will conclude with three points. I understand that the law requires EPA to review the air quality standards every five years and that a court settlement requires a final decision by September of this year. However, the law and this court do not require EPA to change the standard.
In fact, I would like to insert into the record a report from the Congressional Research Service on several questions that Chairman Inhofe and I asked. According to CRS: “EPA has conducted multiple reviews of the National Ambient Air Quality Standards since their establishment in 1971. The primary (health-based) standards have been strengthened twice, retained 6 times, and relaxed or revoked on 3 occasions.”
Next, I want people to understand that the Clean Air Act gives the EPA Administrator the discretion to set the standard. Let me quote from the CRS report again: “…the Administrator is given clear discretion: the requirements are conditioned by the phrase ‘in the judgment of the Administrator.’”
Lastly, this rule will have a major impact on this nation and people are concerned. After all of the members give their opening statements, I am going to insert letters and statements from governors, mayors, other elected officials, and various groups expressing concern about revising the particulate matter standards at this time.
I look forward to hearing from the witnesses on this important issue that truly impacts our energy, environment, and economic needs.