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Melissa Enoch Madoka Yoshino Leslie Tomic Temirlan Moldogaziev Courtney Bonney
V625 Environmental Economics2 April 2008
Which of these are point sources?
ScienceDaily (Nov. 8, 2007) — Emissions from coal-fired power plants may be an important source of water pollution and fish contamination, say researchers at the University of Pittsburgh Graduate School of Public Health.
Higher Levels Of Pollutants Found In Fish Caught Near A Coal-fired
Power Plant
Hoosic River Watershed Association
“While a municipal wastewater treatment
plant might receive water from many sources, it
discharges into a water body at a single point.”
-USGS-
YES
NO
YES
In your opinion, is clean water a…?
Right
54%
PrivilegeNeither
26%17%
Who do you believe should be responsible forfunding the necessary improvements to the nation’s
water and wastewater infrastructure?
FederalGovernment
54%
LocalRatepayers
Both
21%20%
The Luntz Survey (2004)
Why Regulate Point Source?Increased public interest due to visibilityEasy to locate source and monitorDifficulty/cost of cleaning up polluted groundwater
E.g. approximately 4 liters (about one gallon) of pure trichloroethylene, a common solvent, will contaminate over 1 billion liters (300 million gallons) of water
EPA reports that more than one-third of the nation's waters are still not meeting water quality standards,however, non-point source pollution has been
identified as the primary cause.
The Push Towards Clean Water legislation
The Cuyahoga River June 23, 1969• Other fires: 1962, 1952, 1948, 1941, 1936, 1922, 1912, 1887, 1883, 1868.
• 1952 fire caused $1.5 million in damages
• In 1968 Cleveland passed a $100 millon bond issue for clean up; 60% of what the US Gov’t paid for nationwide cleanup efforts
Photograph by Carol Brown, 1952
History of Sewage TreatmentSewer (Sewage pipe): since 5000 years ago19th C: Cholera and water borne disease threats
public health for increased wastewater into open sewers.
20th C: The first sewage treatment plant using biological process built in the UK.
1920s: Sludge dumping to the ocean began1992: Ocean dumping of activated sludge ban in
effect.? ; EPA mandated all wastewater through POTWs
to receive at least secondary treatmenthttp://www.cqs.com/
sewage.htm
The Clean Water Act of 1972
Clean Water Act of 1972Water quality became the responsibility of
the federal governmentMain Goal: Zero-discharge by 1985Interim Goals:
Nation’s waters to be “fishable and swimmable” by 1983
Elimination of toxic pollutants in amounts harmful to human activities or aquatic ecosystems
Legal DefinitionFederal Clean Water Act (§402) defines a "point
source" to mean:
"any discernable, confined and discrete conveyance, including but not limited to any pipe, ditch, channel, tunnel, conduit, well, discrete fissure, container, rolling stock, concentrated animal feeding operation, or vessel or other floating craft, from which pollutants are or may be discharged."
Ferrey, S. (2007). Environmental Law: Examples &Explanations. New York: Aspen Publishers.
Three Major Sources of Point Source Water Pollution
Regulators of Point Source Water Pollution10 Regional EPA OfficesState Departments of Environmental QualityPOTWsCitizens???
Regulator Hierarchy
Regulations for Point SourcesNational Pollutant Discharge Elimination
System (NPDES)Requires permits for all significant dischargers
of wastewater into surface watersPermits state effluent discharge limits (kg of
pollutant per day)
Discharge Requirements for POTWsLimitations on pollutants in both wastewater
and sludgeToxic pollutant limitationsCriteria on acceptable uses for sludgeRemoval efficiency requirementsOperating requirements for effective operation
and maintenance
Discharge Requirements for Industrial Facilities- Direct dischargersTechnology-based standards
Best Practicable Technology (BPT)-by 1977Best Available Technology (BAT)-by 1983New Source Performance Standards
Example of BPT Regulations for Direct DischargerTable 1. BPT Regulations for the Dairy Point Source Category
BOD 30-day standard, large facilities (kg per 1000 kg of BOD5 input)
Receiving Stations 0.190
Fluid Products 1.350
Cultured Products 1.350
Butter 0.550
Cottage Cheese and Cultured Cream Cheese
2.680
Natural and Processed Cheese 0.290
Fluid Mix for Ice Cream and Other Frozen Desserts
0.880
Ice Cream, Frozen Desserts, and Dairy Desserts
1.840
Condensed Milk 1.380
Dry Milk 0.650
Condensed Whey 0.400
Dry Whey 0.400
Resources for the Future, Harrington 2003
Example of BPT regulations for direct discharger (continued)
Other limits
To get the limits in each subcategory for the standards below,
Multiply the number above by
Large facility BOD one-day maximum discharge
2.5
Large facility TSS 30-day average 1.5
Large facility TSS one-day maximum discharge
3.75
Small facility BOD 30-day average 1.67
Small facility BOD one-day maximum discharge
3.33
Small facility TSS 30-day average 2.5
Small facility TSS one-day maximum discharge
5
pH limitation, all plants 6.0 to 9.0
Resources for the Future, Harrington 2003
Discharge Requirements for Industrial Facilities- Indirect dischargersTechnology-based Standards
Pretreatment guidelines Established to deal with a number of problems
associated with industry discharging through POTWs
Guidelines for both new and existing sources
Note: In this case, POTWs have two roles—1) Regulator 2) Service provider
Major Pollutants
http://www.epa.gov/safewater/mcl.html
Major Pollutants Cont.
http://www.epa.gov/safewater/mcl.html
Major Pollutants Cont.
http://www.epa.gov/safewater/mcl.html
Human Health
www.epa.gov/safewater
Damages• Heavy metals from industrial processes
• toxic to aquatic life
• Toxic compounds from industrial waste• damage the health of aquatic animals and
those who eat them• toxins can affect the reproductive success
• Microbial pollutants (from sewage):• Increases number of infectious diseases• Increases the number of mortalities
Damages Cont.• Organic matter and nutrients
• Increases in aerobic algae, which depletes oxygen from the water column
• Sulfate particles• Changes the pH
• Damages health
• Increases the number of mortalities within an environment
• Suspended particles• Reduces amount of sunlight penetrating the water
• Disrupts the growth of photosynthetic plants and micro-organisms
Wastewater treatment technologiesPOTWs: Publicly Owned Treatment Works
Septic tanks, on-site wastewater treatmentsewage treatment plants
advanced treatment: aerobic/ anaerobic treatment,
nitrification/denitrification, phosphorus removal, granular activated carbon absorbtion, rapid sand filtration,
UV disinfection, ozone disinfection, chlorine disinfection
wastewater reuse, land application of biosolids
Combined Sewer OverflowsIndustrial Facilities
http://www.epa.gov/OW-OWM.html/mtb/mtbfact.htm
Wastewater Treatment SystemWater from households, industry, streets
flow into the sewer POTWsSewage treatment at the POTWs
Primary treatment (settling/sedimentation)Secondary treatment (biological treatment)Tertiary treatment (advanced Treatment)
Water Environment Federation Go with the Flow!
http://wef.org/apps/gowithflow/theflow.htm
Wastewater treatment coverage
JapanSwedenHolandGermanyCanada U.S. U.K.
Wastewater treatmentAdvanced wastewater treatment
Population coverage rate of advanced wastewater treatment plants in various countries.
Population coverage rate of wastewater treatment plants.
Combined Sewer Overflow (CSO) Management TechnologiesCombined Sewer Systems:
single pipe sewer systems that convey sanitary wastewaters and storm water runoff to a publicly owned treatment works
CSO affects the environment and human health: CSOs may contain high suspended solids, BOD,
oil and grease, flotables, toxic pollutants, pathogenic microorganisms
CSO managementProper operation and regular maintenance
(O&M)Routine inspections, maintenance and cleaning
of CSS.O&M reporting, record keeping systems,
reviewing, up-dating, and revisingTraining
Pipe separationWater flow control
Source: Kentucky Division of Water
Industrial Wastewater TreatmentAgricultural and Food IndustryIron and Steel IndustryOrganic chemical Industry (pharmaceuticals,
pesticides, plastics, detergents, etc.)Mining IndustryPaper Mills
Agricultural Wastewater
Aerobic & Anaerobic Lagoons
Land SpreadingConstructed
Wetlands
High NutrientNitrogen,
PhosphorusSolidsAntibioticsPathogenic bacteriaParasitesSynthetic hormonesOrganic matters
Treatment
Livestock waste management
http://cryo.naro.affrc.go.jp/index_e/1302A.jpg
Nature, 2003, July 3rd issue
Technology?
The process of internalizing externalities to improve overall social welfare.
• Nitrogen• Phosphorus• Ammonia• BOD• COD• pH• Selenium• Water flow• Temperature• TSS• Heavy metals
Source: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
Direct MethodsCommand-and-Control:
Quantity based regulation: Quotas w/o trading
Technology-based regulation Best Available Technology (BAT)
Grandfathering Subsidizing Pollution AbatementTaxes
Indirect MethodsPermits and trading (Marginal Abatement Cost =
forgone profits or rent)Credit trading, cap-and-trade, one-time or ongoing offset
programProblems:
Failure due to insufficient market Few traders large trader ratio (buyers: consumers, or consumers: buyers)
Size of watershedHoarding, over allocation of permitsReluctance to trade with competitionInsufficient division of property rights
Tradable PermitsBilateral negotiation: buyer and seller exchange
information and negotiate the termsHigh initial costs to establish infrastructure for
communication and enforcementBanking and borrowingThird party broker
Water Quality Clearinghouse: converts production with variable price and quality into a uniform productReduces search and information costsEliminates all contractual or regulatory links between
sellers and buyersReduces uncertaintyPublicly visible and standardized practices allow for
reduced costs with bargaining and negotiation
Transaction CostsResearch and informationBargaining and decisionMonitoring and enforcement
Unidirectional vs. multidirectionalSeller or buyer liability
Sole Source OffsetsA source is allowed to meet water quality
standard at one point if pollution is reduced elsewhere, either on-site or by carrying out pollution reduction activities off-site
ProblemsDoes not introduce any additional partiesNo incentives for pollution reduction by
entities that are already in compliance
Methods UsedTrading:•PS-PS•PS-NPS•NPS-NPS
Source: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
Approximated cost-savings from US trading programs
Source: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
Wisconsin Fox River• 1981: Market for BOD discharged by pulp/paper
mills and municipal waste treatment plants• Limited trading with marketable discharge permits
(6-7 plants in two clusters)• Flexibility in abatement options administered by the
state• Five year permits that define waste load allocation• Permit negotiation for a year• Permits can expire• High transaction Costs• Estimated $7 million savings/year• Existed 6 years with one trade
Projected Increase in BOD
Source: EPA, 2002. The Clean Water and Drinking Water Infrastructure Gap Analysis
What approaches (policy tools) could be used to implement a policy for the pollutant in question?Historical Trend - Control vs. incentive
spectrum of politically acceptable practices:a) Started with Command-and-Controlb) Switched to Taxesc) Tradable Permits (Kieser et al, 2002)
Setting up marketable permits - Marketable permits are preferred lately (Woodward et al, 2002): a) A total cap on Pollution Establishedb) Rights and Responsibilities are Allocatedc) Trading is Allowed to reallocate these resources
among the sources
Market Structure vs. Type of Program
Incentive based programs may have different market stuctures (Pharino 2007) – market structure example from Economics section
Market structure is important for allocative efficiency and size of transaction costs
As of 2007, there were 47 incentive based programs in the US, either running or at early implementation stages.
Type of trading vs. number of programs
Are all the trading programs strictly PS to PS?Source: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
Pollutant vs. Number of ProgramsType of pollutant affects a choice of policy instrumentSource: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
Design Structure vs. Number of Programs
Program Design structure determines who is in or outSource: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
Numbers of trades vs. number of programs
Are all the trading programs effective? Source: Pharino C. 2007. Sustainable Water Quality management Policy, Springer Netherlands.
“The Bubble”
Direct contact/Participation in Decision making
Execution of Decisions/Feedback/Gov Services
Political processes determine – Who gets What, When, and How?
Where do the policies come from?
Interested parties: Organized or Unorganized Parties/Actors
Companies/Industry: directly affected by clean-up costs and transaction costsPoint-source and non-point source polluters: NPS
traders have a superior trading position, availability of additional places to buy savings from
Environmental Protection Groups: Organized to protect the rights of nature and/or intra- and intergenerational justice: now vs. later (Solow, Ch. 26).
Citizens/publics: directly affected by effluent discharges and quality of water
Interested Parties Cont.
Levels of Government: convergence/divergence of goals and resources
Specific agencies charged with overseeing the regulation
NGOs and civil society: advocacy for the rights of special populations or equity goals
Government institutions:
division according to the branch of government, checks and balances are an important part of decision making
Issues facing our POTWsAging Infrastructure
Increasing and Geographically Shifting Population
Insufficient Treatment
Decreased Expenditures in Water Pollution Abatement Research & Development
Inefficient monitoring of private septic tank systems
Small communities are less able to meet standards than large communities.Source: EPA, 2002. The Clean Water and Drinking Water Infrastructure Gap Analysis
Capital Payment GapNo Revenue Growth Revenue Growth
Source: EPA, 2002. The Clean Water and Drinking Water Infrastructure Gap Analysis
Other OptionsPollution PreventionPet Non-Industry
ExamplesThe Composting ToiletHoop-House Hog
Farming
Source: Nature Loo
Savings from Pollution Prevention
Source: Overcash, M., Environmental Management for the Future
Source: Horowitz, John., et. Al. 2006. Do Plants Overcomply with Water Pollution Regulations? The Role of Discharge Variability. Topics in Economic Analysis and Policy
Would Regulation Tightening Reduce Pollution?A 2006 study shows that plants are often polluting below
standardsDischarge Variability
In a study of plants releasing BOD, plants polluted up to 60 percent below set standards
Discharge variability leads plants to reduce their average discharges in order to reduce their chance of violation
Community Pressure Richer-type communities have higher compliance rates Richer-type described as white, high income, low-manufacturing,
medium population
Source: Horowitz, John., et. Al. 2006. Do Plants Overcomply with Water Pollution Regulations? The Role of Discharge Variability. Topics in Economic Analysis and Policy
We would like to encourage a debate regarding the best options for future regulation in point source pollution.