American Oil and Gas Reporter - January 2015 - 36

or $30,000 investment tax credit for AFV
refueling property, and the $1,000 tax credit for home refueling appliances.
The group notes that the legislation also
extends the 50 percent bonus depreciation
option for nearly all business equipment
placed in service during 2014.
New Legislation
A few oil- and gas-related bills that surfaced in late 2014 included HR 5814 by
Representative Joe Barton, R-Tx., which

sought to repeal the U.S. ban on crude oil
exports that was established after the
1973 embargo by the Organization of Petroleum Exporting Countries. In a statement from his office, Barton suggests support for U.S. oil exports is coming from
a wide range of experts and stakeholders.
"Pressure to remove the ban on crude
oil exports is growing from both ends of
the political spectrum," he says. "I predict
that no matter which party controls Capitol Hill or the White House, the ban

eventually will be lifted for the same reasons Congress eventually overturned other failed government efforts to regulate energy price and supply."
December also saw Representatives
Mark Pocan, D-Wi., and Jan Schakowsky,
D-Il., introduce a bill to bar hydraulic fracturing on federal lands. Press accounts say
the legislation drew praise from environmental groups as a way to preserve wilderness spaces from fossil fuel extraction.
Ì

EPA Proposes Lower Ozone Standard
WASHINGTON-The U.S. Environmental Protection Agency is proposing to
lower national standards for ground-based
ozone emissions. It asserts the action will
better protect public health, particularly for
children, the elderly, and those with lung
diseases such as asthma.
The agency says it is considering setting national ambient air quality standards
for ozone levels between 65 and 70 parts
per billion, and also is seeking comments
on alternative standard levels as low as 60
ppb. The current limit, established in
2008, is 75 ppb. EPA says its proposal also
expands the ozone monitoring season for
many states and updates the air quality index, which issues alerts when air quality
hits unhealthy levels.
Under the Clean Air Act, EPA says it
is required to set two outdoor air quality
standards for ozone: a primary standard to
protect public health, and a secondary standard to protect the public welfare. The
agency is required to review the standards
every five years.
EPA also is proposing to strengthen the
secondary standard, now at 75 ppb, to improve protection for trees, plants and
ecosystems. EPA says studies since its
2008 review provide evidence that repeated exposure to ozone reduces growth and
has other harmful impacts on plants and
trees. The revised secondary standard
should protect against the cumulative exposures that could damage trees and
plants during the consecutive three months
in the growing season when daytime
ozone concentrations are the highest and
plant growth is most affected, EPA says.
Under the agency's projections, the total national cost to implement the 70 ppb
standard is $3.9 billion and $15.0 billion
for the 65 ppb standard, not including California. Estimated costs for that state
post-2025 are $800 million for a 70 ppb
standard and $1.6 billion for the 65 ppb
standard. EPA says it analyzes the costs
and benefits for California separately because a number of its counties would have
36 THE AMERICAN OIL & GAS REPORTER

longer to meet the proposed standard,
based on their ozone levels. Several California counties have attainment dates as
late as 2037.
In its document laying out the regulatory impacts of the proposed change,
EPA says the Clean Air Act requires it to
set standards based on public health needs,
without considering costs. However, it
adds, "The agency believes that considering costs and benefits is an essential decision-making tool for the efficient implementation of these standards. The impacts
of costs, benefits, and efficiency are considered by the states when they make decisions regarding what timelines, strategies
and policies are appropriate for their circumstances."
California Standards
According to EPA, it is relying on an
extensive body of scientific evidence to update both ozone standards, including accepting comments in support of lowering
the primary standard to 60 ppb. It estimates
meeting the standards will result in health
benefits, excluding California, valued at
$6.4 billion-$13.0 billion annually by
2025 for 70 ppb, and $19.0 billion-$38.0
billion annually for 65 ppb.
Benefits to meeting the proposed standards in California add to the nationwide
benefits after 2025, EPA says, estimating
the values at $1.1 billion-$2.0 billion annually for 70 ppb and $2.2 billion-$4.1 billion for 65 ppb.
Individual states decide what measures
to implement to meet the federal standard,
the agency notes, using federal regulations
such as the final mercury and air toxics
standards, final Tier 3 vehicle emissions
and fuel standards, requirements to reduce
interstate transport of ozone, regional
haze rules, and the proposed Clean Power Plan, which targets emissions from power plants. EPA adds its projections show
the vast majority of U.S. counties with
monitors would meet the proposed standards by 2025 following the rules and pro-

grams now in place or under way.
EPA says it likely will finalize designations for revised ozone standards in late
2017. Depending on the timing of the effective date, the agency says nonattainment
areas classified as marginal would have to
reach attainment either late in 2020 or early 2021. Nonattainment areas classified as
moderate would have late 2023/early
2024 deadlines, while serious nonattainment areas likely would have to reach attainment in late 2026 or early 2027.
According to EPA, it selected 2025 as
the primary year of its analysis because
most areas of the United States likely
would be required to meet a revised ozone
standard by that year, and because it provided a good representation of the remaining air quality concerns that moderate
nonattainment states faced.
In addition to selecting primary standards that provide an adequate margin of
safety, the agency says it is seeking to not
only prevent pollution levels that have been
demonstrated to be harmful, but also to prevent lower pollutant levels that may pose
an unacceptable risk, even if the nature and
degree of risk are not precisely identified.
The scientific advisory committee working with EPA recommended a range of revised levels down to 60 ppb. EPA reports
setting a standard below 65 ppb "would inappropriately place very little weight on the
uncertainties in the health effects evidence
and exposure/risk information."
Industry Reaction
The new EPA ozone regulations are not
needed, as the nation's air quality continues to improve under the 2008 standards
and other regulations, the American Petroleum Institute asserts. API President and
Chief Executive Officer Jack Gerard says
scientific reviews show the current levels
already protect public health.
"Tightening these standards could be the
most expensive regulation ever imposed on
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American Oil and Gas Reporter - January 2015

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