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Proposal to Lower the Standard Would Jeopardize Manufacturing Expansion

WASHINGTON (August 22, 2014) - American Chemistry Council (ACC) Vice President of Regulatory & Technical Affairs Michael Walls today testified  at a Senate Environment and Public Works Committee minority briefing in Lake Charles, La. regarding the U.S. Environmental Protection Agency's (EPA) anticipated proposal to lower the National Ambient Air Quality Standard (NAAQS) for ozone.

The briefing analyzed potential impacts for project development in Louisiana and elsewhere if EPA radically revises the current standard. It takes place while $124 billion in new chemical industry investment is planned for the U.S., including 44 projects - $30 billion worth - bound for Louisiana. 

"Louisiana is an attractive place to invest in part because every area of the state can meet the current ozone NAAQS of 75 parts per billion," Mr. Walls testified. "Based on the recommendation of the Clean Air Scientific Advisory Committee, EPA is poised to propose a more stringent ozone standard, as low as 60 ppb. If EPA were to finalize a standard at that level, all of Louisiana, along with most of the rest of the country, would be unable to meet it."

Facilities located in areas of non-compliance, or 'nonattainment,' face extensive and stringent regulations that can effectively block new investment. For example, despite spending billions of dollars on emission controls, the Houston area is in nonattainment with the current standard. Companies wanting to expand or build a facility there must obtain emission offsets to secure a preconstruction permit.

"All of this is bad news for Louisiana and other states which would instantly be placed in nonattainment if the ozone NAAQS standard were lowered to 60 ppb," Mr. Walls continued. "It is very likely that facilities would expand only if they shut down operations elsewhere, or they came up with the significant additional investment required to buy increasingly expensive offsets. Economic growth, new jobs and a sustainable competitive advantage for U.S. manufacturing are at risk from a lower ozone standard."

EPA has not finalized the implementation rule for the current ozone NAAQS of 75 ppb, which was set in 2008 and is the most stringent ever. ACC is very concerned that EPA is moving forward with lowering the ozone NAAQS without fully implementing the current standard.

"Given our industry's unprecedented expansion and potential to drive further growth in U.S. manufacturing, we are troubled by what could happen to business investment in the many new nonattainment areas that will emerge if EPA dramatically lowers the standard," Mr. Walls concluded. "ACC urges EPA to conduct a full study of the impacts of implementing a lower ozone NAAQS, including the costs to industry and the public, before moving forward with a proposal."


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