Efficiency in Environmental Regulation : A Benefit-Cost Analysis of Alternative Approaches

A management agency --such as a publicly or privately owned electric utility -- must, if it is to be efficient in carrying out its day-to-day tasks, have a means of monitoring its performance to assess the efficiency of its operations and the effectiveness of its planning. For example, how did the demand for electricity compare with that assumed in planning? How effective were the incentives applied to induce energy conservation by users? Such ex post analyses are essential for improving the planning process and hence for improving decisions with respect to efficiency and resource allocation. Unfortunately, it seems to be very difficult for public agencies to make such ex post evaluations an integral part of agency activities, whether the agencies are "producers," e. g. , the Corps of Engineers or the Bureau of Reclamation with respect to water resources management, or are regulatory agencies such as the Environmental Protection Agency or the Food and Drug Administration. Here and there a few ex post analyses of agency programs have been done, but rarely by the responsible agency itself. These analyses have attempted to compare the results actually achieved with the results estimated in planning, either in terms of project outputs or in terms of effectiveness of regulatory and/or economic incentives in inducing desired changes in behavior.

1. Introduction.- 2. Regulatory Approaches.- Elements of a Regulatory Program.- Developing Standards.- Issuing Permits.- Monitoring Compliance.- Enforcing Regulations.- The Clean Water Act.- Technology-Based Standards.- Technology-Based Toxics Standards.- Technology-Based Standards for Indirect Dischargers.- The Clean Air Act.- Ambient-Based Standards.- Benefits-Based Standards.- Technology-Based Hazardous Air Standards.- The Resource Conservation and Recovery Act.- Hazardous Wastes.- 3. Technology Approach.- Pollution Control Costs And Effluents.- Inventory — 1973, 1984, and 1994.- Effluent Data.- Cost Modeling.- Estimated Costs and Effluents.- Cost Comparisons.- Water Quality Impacts.- Sample Sites.- Scenarios.- Water Quality Modeling.- Estimated Water Quality Improvements.- Validation of the RGDS Model.- Monetary Benefits.- Recreation Population.- Valuation of Recreation Benefits.- Estimated Benefits.- Possible Biases in the Benefit Calculations.- Findings.- Appendix 3-A. Costs for Indirect-Discharging Mills.- Appendix 3-B. Pulp and Paper Mills Evaluated in this Study.- Appendix 3-C. Water Pollution Control Cost Estimation.- Appendix 3-D. Water Pollution Control Cost Comparisons.- Appendix 3-E. Loadings Data.- Appendix 3-F. Water Quality Model.- Appendix 3-G. Model Validation.- Appendix 3-H. Visitation Estimates.- Appendix 3-I. Recreation Benefit Studies.- Appendix 3-J. Sensitivity Analysis for Benefit Calculations.- 4. Ambient Approach.- Pollution Control Costs and Emissions.- Inventory — 1973, 1984, and 1994.- Emissions Data.- Cost Modeling.- Estimated Costs and Emissions.- Cost Comparisons.- Air Quality Impacts.- Sample Sites.- Scenarios.- Air Quality Modeling.- Estimated Air Quality Improvements.- Validation of MCP Model.- Monetary Benefits.- Exposure.- Health and Welfare Effects.- Valuation of Benefits.- Estimated Benefits.- Possible Biases in the Benefit Calculations.- Findings.- Appendix 4-A SO2 Emissions and Costs.- Appendix 4-B. Pulp-Producing Mills Evaluated in this Study.- Appendix 4-C. Air Pollution Control Costs (TSP).- Appendix 4-D. Air Pollution Control Cost Comparisons.- Appendix 4-E. Loadings Data.- Appendix 4-F. Air Quality Model.- Appendix 4-G. Emissions Versus Concentrations.- Appendix 4-H. Model Validation.- Appendix 4-I Derivation of Concentration Response Functions for Health Effects.- 5. Benefits Approach.- Pollution Control Costs and Emissions.- Inventory — 1973, 1984, and 1994.- Emissions Data.- Cost Modeling.- Estimated Costs and Emissions.- Air Quality Impacts.- Sample Sites.- Scenarios.- Air Quality Modeling.- Estimated Air Quality Improvements.- Monetary Benefits.- Exposure.- Health and Welfare Effects.- Valuation of Effects.- Estimated Benefits.- Possible Biases in the Benefit Calculations.- Findings.- Appendix 5-A Kraft Pulp Mills Evaluated in this Study.- Appendix 5-B. Air Pollution Control Cost Estimation (TRS).- Appendix 5-C. TRS Emissions.- Appendix 5-D. The MPTER Model.- 6. Compliance.- Measuring Compliance.- Water.- Air.- Water Compliance.- Technology-Based Compliance.- Ambient-Based Compliance.- Benefits-Based Compliance.- Findings — Water.- Air Compliance.- Technology-Based Compliance.- Ambient-Based Compliance.- Benefits-Based Compliance.- Findings — Air.- Findings.- 7. Growth.- Conventional Water Pollutants.- Technology-Forcing Approach.- Antidegradation Approach.- Benefits Approach.- Findings — Water.- Criteria Air Pollutants - TSP.- Technology-Forcing Approach.- Nondegradation Approach.- Benefits Approach.- Findings — TSP.- Designated Air Pollutants - TRS.- Technology-Forcing Approach.- Ambient Approach.- Benefits Approach.- Findings — TRS.- Findings.- Appendix 7-A. 1984—1994 TRS Emission Reduction Policies.- 8. Toxic Pollutants.- Water Pollutants - Dioxin.- Effluents.- Health and Ecological Effects.- Ambient Concentrations.- Risks to Public Health.- Risks to Ecosystem.- Effluent Reduction Technology and Costs.- Dioxins.- Regulatory Approaches.- Findings - Dioxin.- Chloroform - Air Pollutant.- Emissions.- Health and Ecological Effects.- Risks to Public Health.- Emission Reduction Technology and Costs.- Regulatory Approaches.- Findings - Chloroform As A Hazardous Air Pollutant.- Chloroform - Hazardous Waste.- Pulp and Paper Wastes.- Risks To Public Health.- Effluent Reduction Technology and Costs.- Regulatory Approaches.- Findings - Chloroform as a Hazardous Waste.- Findings.- Appendix 8-A. Mills in the TOX Analysis.- Appendix 8-B. Critique of the Chloroform Risk Assessment.- Appendix 8-C. Process Modification Costs.- Appendix 8-D. Mill-Specific Costs for Hypochlorite Elimination.- Appendix 8-E. Mill-Specific Costs for Chloroform Reduction.- 9. Conclusions.- Regulatory Approaches.- Historical Analysis (1973–1984).- Projections of the Future (1984–1994).- Historical Perspective.- Future Direction.- Appendix A. The Pulp and Paper Industry.- Industry Profile.- Capacity.- Geographic Distribution.- Standard Manufacturing Processes.- Preparing Raw Material.- Pulping.- Bleaching of Wood Pulps.- Papermaking.- Converting.- Sources of Wastes.- Water Effluents.- Air Emissions.- Solid Wastes.- Estimated Generation of Wastes.- Appendix B. Mills Evaluated in the Study.- Appendix C. Inflation Indexes.- Appendix D. Glossary of Environmental Terms.- Author Index.