WASHINGTON — Tenneco Packaging's polystyrene foam products plant in Covington, Ga., is preparing to spend $5 million — about 10 percent of the facility's book value — to meet tough Environmental Protection Agency air-quality rules expected by midsummer.
AET Films Inc.'s two oriented polypropylene film plants in Virginia and Indiana, on the other hand, do not see any problems meeting the new rules, according to an official with the New Castle, Del.-based firm.
Those different assessments highlight the difficulty in determining the impact of EPA's proposal to tighten ozone and particulate matter emission standards significantly. One observer said the new rules could encompass flexible packaging processes, such as film extrusion, that generally are outside the current rules.
EPA says the rules will mean 15,000 fewer premature deaths each year and go a long way toward cleaning up air in the nation's most-polluted cities.
But industry—and some key members of Congress—argue the benefits are not clear, and they say that many cities and companies not previously affected will be subjected to strict new rules. And they point out that EPA has backed down from studies that initially claimed 20,000 premature deaths a year would be prevented.
Lobbyists on all sides are gearing up for a blitz before EPA must make a decision by a court-imposed deadline of July 19, with much of the attention focused on convincing the White House to override EPA. The Flexible Packaging Association, whose members include plastics processors, had more than 50 company officials come to Washington May 21 and 22 for its single-largest lobbying event ever.
``It's war,'' Madeleine D. Robinson, chief executive officer of LPS Industries Inc. in Moonachie, N.J., told an FPA reception. ``We've got these nut-jobs up there [in EPA] who think they are doing good for people.''
Determining the specific impact for a plant, however, is a little like trying to see a microscopic particle of air pollution with the naked eye. The hard choices of how much emission reductions to require from factories, automobiles and other sources will get made at the local level.
But here's how the EPA proposal would raise the bar:
For particulate matter, or PM, particles as small as 2.5 microns will be regulated. Currently, only particles larger than 10 microns are covered.
For ozone, which is measured across a metropolitan area, a region must not exceed levels of 0.08 parts per million measured in an eight-hour period. Currently, regions cannot exceed 0.12 ppm in one hour.
An analysis prepared by FPA said the roughly 1,000 U.S. converting facilities will spend an average of $3.5 million each to comply, bringing the industry cost to $3.5 billion. That assumes four presses and a laminating line per factory, with a price tag of $2 million for an incinerator, $1.3 million for two bag houses to capture particles and $250,000 to put enclosures around the equipment, said Mark Wygonik, FPA's director of technology and regulatory affairs.
``We took a rational worst-case look based on the past,'' he said. ``We anticipated that stationary sources [such as factories] would get hit because they are easier to regulate... [and] seem to be the target of choice for EPA.''
Wygonik said the proposal tightens ozone rules and opens a ``brand-new ballpark'' with the smaller PM standard that could encompass flexible packaging processes, such as extrusion, that generally fall outside the current rules.
The EPA does not require specific action by local regulators but it is likely that those communities would look at smaller and smaller sources, said Lewis Freeman, vice president of government affairs at the Society of the Plastics Industry Inc. in Washington. Many of the cities newly covered under the rules are in areas with strong plastics industries, he said.
EPA Administrator Carol Browner told a Washington panel discussion May 28 that ``big industry'' will make the ``biggest reductions'' in emissions.
Industry officials differed on their assessment of the impact, but most, like Doug Cook, director of environmental affairs at Atlanta-based Printpack Inc., said they anticipate tougher controls, even if it's difficult to determine what those will be.
Victor Platta, vice president of sales and marketing for Advance Polybag Inc. in Metairie, La., said its Oklahoma City, Okla., plant is likely to spend about $500,000 to modify its polyethylene extrusion lines.
``Suddenly we are going to take this money we would have channeled into growth into something we could not get a return on,'' Platta said.
Tenneco's Covington plant probably will spend $5 million to triple its capacity for collecting vapors and burning them, and an additional $330,000 a year to power that equipment, said Dave Sheffield, the plant's environmental manager.
``It wouldn't shut us down,'' Sheffield said. ``Incrementally, it would start to raise the costs of goods you sell. It may make future expansions less likely.''
Tenneco officials said 10 plants they examined in detail would require $42 million initially for new equipment and $8 million a year after that.
EPA officials, however, say the long-term benefits from lower health-care costs and longer lives will more than outweigh the costs. EPA estimates the law will
yield between $8 billion and $80 billion in benefits by 2007.
Cost issues cannot be part of the EPA's decisions now, officials said. The law says EPA must consider only health issues when developing a standard, leaving cost issues until it considers implementation, Browner said.
For the next six weeks, the lobbying battle will enter its ``two-minute'' drill, said Alphonse Mannato, senior regulatory analyst with the American Petroleum Institute and a 15-year EPA employee.
The focus of industry lobbying needs to be on convincing the White House to override Browner and rewrite the rules, said Michael Mason, director of federal relations at Tenneco. Several Administration agencies are questioning EPA, he said.
Browner said she has not made a decision on the rule but showed no sign of backing off at the panel discussion.
``I can tell you that we have not found anything... which causes us to question the science,'' she said.
Support is growing in Congress for nullifying the rule, but Republicans lost House races on environmental issues and are afraid of losing a public battle on the issue, Mason said. That will make a legislative fix ``very difficult,'' Mannato said.
The opposition on Capitol Hill and among other Clinton Administration agencies could be strong enough to convince the White House to soften the rule, Freeman said.
Rep. David McIntosh (R-Ind.), chairman of the Subcommittee on National Economic Growth, Natural Resources and Regulatory Affairs and an outspoken opponent of the rule, told an FPA reception that overturning the rule is not a priority among congressional leaders and probably would not get support from a majority in Congress, he said.