EPA Proposal Promotes Fossil Fuel Use over Renewable Wood Use for Heating Homes

The latest example of big brother schemes brewing in Washington this year is the proposal of the Environmental Protection Agency (EPA) to significantly restrict solid particulate emissions from wood burning stoves. The Census Bureau estimated that 2.4 million U.S. homes use wood as a primary source for heating their homes. The EPA is proposing that manufacturers be required to reduce solid particulate matter emissions by any wood burning stove from the current level of 7.5 grams per hour to 4.5 grams per hour by 2015, and further reductions to 1.3 grams per hour by 2019 (see Table 3).

We should not be surprised that this proposal has the earmarks of inefficient bureaucratic design. When the potential cost savings from an efficient policy design are spread out across millions of taxpayers, there are too few concentrated benefits for anyone to justify the costs of lobbying for efficient regulations. Yet, when restricting individual liberties creates plenty of concentrated benefits for a relative few, this potential bounty justifies intense lobbying — especially when the probability of success is boosted by dispersing the costs of such inefficiency across millions of taxpayers. As my economist father always said, “Efficiency has no constituency in Washington.”

The inefficiency of this proposal is revealed in how the EPA calculates the health benefits and compliance costs of these new standards over the next eight years. They estimate that health benefits will range from $1.8 billion to $4.2 billion (see Table 8). This compares to their estimated cost of $15.7 million resulting from compliance by the manufactures — most of which will likely be passed on to consumers. Assuming the methodology is sound, this appears to be a good overall cost-benefit ratio.

However, this proposed regulation would be applied equally to all areas of the U.S. This typical government “one size fits all” approach to regulation ignores the basic economic principle of creating the biggest bang for the buck across all the different areas to be regulated. In other words, uniform regulatory enforcement fails to apply stronger emissions restrictions where the solid particulate pollution is heaviest (and the benefits of compliance would be highest), and fails to apply weaker emissions restrictions where alternative sources of heating fuel are much more scarce and expensive (and the costs of compliance would be highest). This approach could attain the same emissions reduction at lower total regulatory cost.

Further, making renewable energy heating sources like wood more expensive simply increases consumer demand for heating using finite fossil fuels like oil and coal, each with their own highly criticized emissions. It turns out the EPA intentionally omits this economic impact in their cost estimates, stating, “We have not determined the potential for consumers to choose other types of fuels and their associated appliances if the consumer costs of wood-fueled appliances increase and at what level that increase would drive consumer choice.” (See Section IV, subsection E.) This means the real cost-benefit ratio may be much less favorable.

Comments (6)

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  1. Jeremiah says:

    They’ve had their pet clean-green marketing lobbies accentuating particulate matter comparative epidemiology – exaggerated yet fundamentally inconclusive health costs, presentations of purposely complex equations and calculations, and those fuel sponsors – particularly from shale natural gas have the lobbyists/ investors tied around their little finger – typical US lawmaker propaganda/ public relations to expand their fossil fuel empire. Wood is renewable. Stoves if they focussed on the external ventilation factors with affordable retrofit technology applied to existing appliances/ flues would result in less to often no emissions. Only those continually exceeding levels assessed by a simple Ringelmann test need attention as a neighbourhood nuisance, not some natural gas/ air conditioning futures investor fiasco wanting all solid fuels replaced by federal collusion with industry organisations and their minority shock-indoctrinated profits. Effects long and short term from this generic Harvard invention, ‘particulate matter’ are not toxicologically conclusive, are purposely hypothesis weighted in the negative because of the influence from the fuel lobbies, full stop.

  2. BHS says:

    “It turns out the EPA intentionally omits this economic impact in their cost estimates, stating, “We have not determined the potential for consumers to choose other types of fuels.”

    Typical EPA math! Just completely ignore costs to make something appear cost-effective.

  3. Thomas says:

    “This typical government “one size fits all” approach to regulation ignores the basic economic principle of creating the biggest bang for the buck across all the different areas to be regulated.”

    Sounds just like any other government approach.

    • Andrew says:

      They cant understand that “one size fits all” doesn’t work because not everything is the same. What is good for one is not good for the other.

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